[Federal Register Volume 63, Number 182 (Monday, September 21, 1998)]
[Notices]
[Pages 50225-50237]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-25198]


-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

[FRL-6163-6]


Retrofit/Rebuild Requirements for 1993 and Earlier Model Year 
Urban Buses; Approval of a Notification of Intent To Certify Equipment

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of Agency approval of an application for equipment 
certification.

-----------------------------------------------------------------------

SUMMARY: The Agency received an application dated October 21, 1997 from 
the Engelhard Corporation (Engelhard) with principal place of business 
at 101 Wood Avenue, Iselin, New Jersey for certification of urban bus 
retrofit/rebuild equipment pursuant to 40 CFR 85.1404-85.1415. The 
equipment is applicable to Detroit Diesel Corporation's (DDC's) 
petroleum-fueled 6V92TA model engines having electronically controlled 
fuel injection (DDEC) of model years 1988 through 1993. On April 9, 
1998 EPA published a notice in the Federal Register (63 FR 17411) that 
the notification had been received and made the notification available 
for public review and comment for a period of 45 days. EPA has 
completed its review and the Director of the Vehicle Programs and 
Compliance Division has determined that it meets the requirements for 
certification, conditioned on the terms discussed below in section IV. 
The effective date of certification is discussed below under DATES.
    The certified equipment complies with the 0.10 gram per brake 
horsepower-hour (g/bhp-hr) particulate matter (PM) standard for the 
engines for which it is certified (see below). In addition, the 
equipment will be offered to all parties for $7,940 or less (in 1992 
dollars) incremental to the cost of a standard rebuild. Certification 
of the ETX equipment, as it applies to engines of model years 1988 
through 1990, is conditioned upon Engelhard complying with the terms 
discussed below in section IV.
    The certification of this equipment triggers requirements for all 
transit operators using compliance Program 1 (including engines 
certified to meet California emissions standards) that have engines in 
their fleet covered by this certification.


[[Page 50226]]


ADDRESSES: The Engelhard application, as well as other materials 
specifically relevant to it, are contained in Public Docket A-93-42, 
Category XXII-A, entitled ``Certification of Urban Bus Retrofit/Rebuild 
Equipment''. Docket items may be inspected from 8 a.m. until 5:30 p.m., 
Monday through Friday. As provided in 40 CFR part 2, a reasonable fee 
may be charged by the Agency for copying docket materials.

DATES: Today's Federal Register notice announces the Agency's decision 
to certify the ETX equipment, as described below. The effective date of 
certification was established in a letter dated July 1, 1998, from the 
Director of the Vehicle Programs and Compliance Division to Engelhard 
Corporation. (A copy of the letter is in the public docket, which is 
located at the address noted above.) This certified equipment may be 
used immediately by urban bus operators, subject to the condition in 
Section IV. Transit operators having affected engines and using 
compliance program 1 are required to use equipment certified to the 
0.10 g/bhp-hr PM standard when rebuilding or replacing applicable 
engines six months or more after September 21, 1998. For determining 
compliance with the requirements of program compliance option 1, the 
effective date of certification is September 21, 1998.

FOR FURTHER INFORMATION CONTACT: William Rutledge, Engine Programs and 
Compliance Division (6403J), U.S. Environmental Protection Agency, 401 
M St. SW, Washington, D.C. 20460. Telephone: (202) 564-9297.

SUPPLEMENTARY INFORMATION:

I. Background and Equipment Identification

    In a notification of intent to certify signed October 21, 1997, 
Engelhard Corporation (Engelhard) applied for certification of 
equipment under the urban bus program. The notification is clarified in 
letters from Engelhard dated February 9, 1998, June 4, 1998, June 15, 
1998, July 1, and August 6, 1998. The equipment is referred to as the 
ETX rebuild kit, and is applicable to 1988 through 1993 model year 
Detroit Diesel Corporation 6V92TA diesel engines equipped with Detroit 
Diesel Electronic Control (DDEC).
    The notification states that the ETX rebuild kit is designed to 
update all electronically controlled DDC 6V92TA DDEC II engines to 
either 253 or 277 horsepower (hp). The ETX kit incorporates engine 
components (cylinder head fire deck, valve faces and piston crowns) 
that are coated with Engelhard's proprietary GPX technology, a CMX 
catalytic muffler, and an improved turbocharger. The GPX 
and CMXTM technologies are identical to the technologies of 
the kit certified to the 0.10 g/bhp-hr standard for DDC 6V92TA model 
engines that use mechanical unit injectors (MUI). That certification is 
described in the Federal Register on March 14, 1997 (62 FR 12166).
    The basis for the kit is a 6V92TA DDEC II engine that is rebuilt to 
a standard 1991 to 1993 DDC specification. However, when the engine is 
rebuilt it will utilize ETX-specific coated cylinder heads, coated 
valves, cylinder kits incorporating coated piston domes, an improved 
turbocharger, and a CMX-5 catalytic muffler. The 1988 to 1990 model 
year engines also receive an upgraded control program for the 
electronic control module. The ETX parts list is provided in the letter 
to EPA dated August 6, 1998, which can be found in the public docket at 
the address listed above.
    Engelhard indicates that the coated engine components utilize 
unique properties to improve the combustion efficiency of the engine to 
reduce the engine-out emissions of particulate matter (PM). The 
improved turbocharger operates like a typical turbocharger but with 
improved efficiency and airflow. The improved airflow improves 
combustion efficiency which reduces engine-out PM. The CMX-5 catalytic 
muffler incorporates Engelhard's oxidation catalyst technology to 
reduce PM emissions in the exhaust.
    The specific catalytic converter part to be used depends on the 
type of coach as well as the type of engine. Engelhard's notification 
provides a table listing the various catalytic converter kits available 
for different engine/coach combinations. Therefore, transit operators 
cannot use the previously certified converter in place of the new 
converter in the candidate kit.
    Using engine dynamometer testing conducted in accordance with the 
Federal Test Procedure (FTP) for heavy-duty diesel engines, Engelhard 
documented in its October 21, 1997 notification, PM emissions below the 
0.10 g/bhp-hr level. This test data is shown in Table 1.
    Engelhard presents emissions data from testing two baseline 
engines, one rebuilt to a 1988 California (50-state) configuration, and 
the other rebuilt to a 1991 through 1993 model year DDC DDEC II 
standard configuration (using a DDC DDEC II upgrade kit). A 
certification test was performed on the engine after being rebuilt with 
the ETX Rebuild Kit. Lists of parts used in the rebuilds are provided 
in a letter dated February 9, 1998, from Engelhard. This letter can be 
found in the public docket at the address listed above. Transient 
testing was performed in accordance with the federal test procedure of 
40 CFR part 86, subparts N and I.
    The certification testing document a PM emissions level of 0.09 g/
bhp-hr, and also show that emissions of hydrocarbon (HC), carbon 
monoxide (CO), oxides of nitrogen (NOX), and smoke are 
within the applicable standards.
    The emissions data of the notification are summarized below in 
Table 1. Based on this testing demonstration, EPA believes that all 
ETX-equipped engines will meet the 0.10 g/bhp-hr PM standard because 
installation of the kit upon engine rebuild results in the replacement 
of all emissions related parts with a specific set of parts, the 
combination of which results in a documented PM level of 0.09 g/bhp-hr.
    The fuel consumption impact of the ETX kit is discussed below as it 
relates to the life cycle cost analysis.

                                                         Table 1.--Summary of Engelhard Testing                                                         
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                            g/bhp-hr                                                    
                                       -----------------------------------------------------------------------------------------------------------------
     Gaseous and particulate test                    HDDE standards                                                                                     
                                       ------------------------------------------  1988 Calif 6V92TA DDEC   1991-1993 6V92TA DDEC   6V92TA DDEC II with 
                                            1988          1990          1991          II baseline \1\          II baseline \2\            ETX kit       
--------------------------------------------------------------------------------------------------------------------------------------------------------
HC....................................          1.3           1.3           1.3   0.8....................  0.5...................  0.2                  
CO....................................         15.5          15.5          15.5   1.4....................  1.9...................  0.6                  
NOX...................................         10.7           6.0           5.0   5.5....................  4.7...................  5.0                  
PM....................................          0.60          0.60          0.25  0.43...................  0.28..................  0.094                
BSFC \3\..............................                                            0.481..................  0.498.................  0.503                

[[Page 50227]]

                                                                                                                                                        
Hp (R/O) \4\..........................                                            277/273................  277/281...............  277/266              
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Smoke Test                                                                                                                                
(2)Standards (percent)                                                                                                                                  
--------------------------------------------------------------------------------------------------------------------------------------------------------
ACCEL.................................                                                                                                                  
(2)20                                                                       3.6                                                                         
LUG...................................                                                                                                                  
(2)15                                                                       0.6                                                                         
PEAK..................................                                                                                                                  
(2)50                                                                       8.1                                                                         
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ All 6V92TA testing was performed on engine identification number 6VF-118287.                                                                        
\2\ The DDC upgrade kit (25% reduction) configures an engine to the 1991 model year.                                                                    
\3\ Brake Specific Fuel Consumption (BSFC) is measured in units of lb/bhp-hr.                                                                           
\4\ Horsepower (Rated/Observed during testing).                                                                                                         

    Today's certification extends certification of equipment to engines 
originally certified, or rebuilt, to meet emissions standards of 
California (also referred to as 50-state configurations). The impact of 
this decision on transit operators is discussed in more detail in the 
``Transit Operator Requirements'' section below.
    The ETX kit is intended to be installed at the time of a standard 
engine rebuild. The contents of the ETX kit will vary depending upon 
the model year of the engine to be rebuilt. All ETX kits will include 
coated cylinder heads, coated cylinder kits, improved turbocharger, and 
CMX-5 catalytic muffler. Additionally, the kit for applicable 1988 
through 1990 model year engines will include fuel injectors, engine 
camshafts, and ECM upgrade. To complete a rebuild of 1988 through 1990 
model year engines, an operator must acquire on its own, the other 
required (specified) standard engine rebuild parts: Blower and engine 
gasket kit. To complete a rebuild of 1991 through 1993 model year 
engines, an operator must acquire the specified standard blower, fuel 
injectors, engine camshafts, and gasket kit. The emissions defect 
warranty will cover the parts which Engelhard supplies in the ETX kit.
    Engelhard is required to provide a 100,000 mile defect warranty and 
150,000 mile emissions performance warranty for the components of ETX 
kit.
    The ETX equipment is certified to a PM emission level of 0.10 g/
bhp-hr for all 1988 through 1993 DDC 6V92TA DDEC II urban bus engines 
using either diesel fuel #1 or #2 (including engines originally 
certified, or rebuilt, to meet California emissions standards). Table 2 
lists the applicable engine models and certification levels associated 
with the certification announced in today's Federal Register.

                     Table 2.--Certification Levels                     
------------------------------------------------------------------------
    Applicable models \1\          Engine code       Certified PM level 
------------------------------------------------------------------------
1988-1993 Detroit Diesel      ALL (including those  0.10 g/bhp-hr.      
 6V92TA DDEC II.               certified or                             
                               rebuilt to meet                          
                               California or 50-                        
                               state emissions                          
                               standards).                              
------------------------------------------------------------------------
\1\ Conditional certification applies to 1988 through 1990 model year   
  engines. See discussion in section IV.                                

II. Summary and Analysis of Comments

    Comments were received from four parties in response to the Federal 
Register notice (63 FR 17411, April 9, 1998): Detroit Diesel 
Corporation (DDC), Johnson Matthey, Incorporated (JMI), New York City 
Transit (NYCT), and Chicago Transit Authority (CTA). DDC is the 
original manufacturer of the engines to which the ETX kit applies, and 
both DDC and JMI have applied for certification of equipment to meet 
the 0.10 g/bhp-hr standard under the urban bus program for these 
engines. NYCT and CTA are both operators of urban bus fleets in areas 
to which the Urban Bus Rebuild Requirements apply.
    Comments and issues generally fell into the following categories: 
(a) Equipment identification; (b) engine power rating; (c) emissions 
testing; (d) durability and in-service concerns; (e) installation and 
maintenance instructions; (f) exhaust back pressure; (g) components of 
the kit; (h) life cycle cost; and, (i) California Engines. These are 
discussed in the sections below.
    Copies of the complete comments and other documentation are 
available in the public docket, which is located at the address stated 
above.

a. Equipment Identification

    The Engelhard notification of October 21, 1997, proposed upgrading 
all engines to one standard 277 hp configuration. Both DDC and JMI 
comment that Engelhard should provide the programming for the 
electronic control module (ECM) for each applicable engine and fuel 
combination (left-hand rotation, right-hand rotation, diesel fuel #1, 
and diesel fuel #2). DDC also notes that two different sets of engine 
camshafts are necessary, depending upon engine rotation direction.
    In response, Engelhard provides the ECM program numbers in its June 
4 and 15, 1998 letters to EPA, as well as the camshaft part numbers for 
left-and right-hand rotating engines.

b. Engine Power Rating

    Both DDC and JMI comment that the ETX kit would update all 
applicable engines, generally 253 and 277 horsepower, to only one 
standard 277 horsepower (hp) configuration. JMI questions whether there 
are additional costs or ramifications for transit operators who operate 
253 hp engines, and states that Engelhard should justify

[[Page 50228]]

the upgrading of the 253 hp engines. DDC states that requiring 
conversion from 253 hp to 277 hp would unfairly penalize operators who 
presumably originally selected the 253 hp rating because it best met 
their operating requirements, would create hardship if vehicle cooling 
systems or drive lines needed to be upgraded to accommodate the higher 
power level. DDC states that, if the ETX kit is approved as a trigger 
of program requirements, then the trigger requirement should be 
restricted to the 277 hp rating.
    In response, in letters to EPA dated June 15 and August 6, 1998, 
Engelhard states that it will offer 253 hp (high and low torque) 
configurations of the ETX kit. EPA notes that today's certification 
will trigger the 0.10 g/bhp-hr standard for both 253 hp and 277 hp 
engines. EPA notes that the only difference between either the 253 hp 
and 277 hp configurations is the ECM programming. Engelhard notes that 
DDC's own DDEC 25% upgrade kit, converts both 253 hp and 277 hp engines 
to one standard 277 hp. Engelhard states that the ETX 277 hp conversion 
does not require an upgrade of the cooling system--both the 253 hp and 
277 hp engine ratings use the same cooling system. Further, the ceramic 
coated parts in the ETX kit reduce the load on the cooling system.
    EPA notes that DDC's 25 percent upgrade kit for the DDEC engines 
converts applicable engines to one standard 277 hp configuration. 
However, this DDC kit is not required to be used by any operator, 
because the kit did not trigger any program requirements. Instead, the 
certified DDC 25 percent kit was an available option to operators that 
were required to meet the program requirement of reducing PM emissions 
by at least 25 percent.

c. Emissions Testing

    NYCT comments that, although the ETX kit functioned adequately 
under the Federal Test Procedure (FTP), further emissions testing is 
required to prove that the ETX will perform to the same level of 
emission reduction when subjected to a bus's operational cycle. NYCT 
recommends using the Federal Transit Administration's Advanced Design 
Bus Urban Driving Cycle to provide assurance that the projected 
reductions are being achieved and that the full value of the investment 
in the technology can be achieved.
    Engelhard notes that the testing required by the regulation was 
conducted, and that alternative cycle testing was not conducted.
    EPA notes that to comply with the 0.10 g/bhp-hr PM standard of the 
Urban Bus Rebuild Requirements, manufacturers must show compliance 
using the FTP described at 40 CFR part 86 subpart N. This requirement 
is consistent with EPA's new engine certification program, which 
requires the engine FTP. Chassis cycle testing, as NYCT suggests, 
generally determines emission rates on a grams per mile basis, which is 
difficult to directly correlate to the grams per brake-horsepower-hour 
(g/bhp-hr) determined by the engine FTP. While the level of emissions 
reductions achieved by the ETX kit under the Advanced Design Bus Urban 
Driving Cycle would be interesting, emission reductions determined by 
chassis cycle testing may vary depending upon the specific driving 
cycle and the specific coach used, and these reductions may not be 
equivalent to the reductions predicted by the FTP. Chassis testing 
would be of no use towards determining compliance with the 0.10 g/bhp-
hr standard because compliance with this absolute standard does not 
necessarily correlate with a specific reduction, and it would be a 
significant additional testing burden. The program regulation also 
requires that candidate equipment must not cause an engine to fail to 
meet applicable federal emission requirements (other than PM) under 
part 86, which also requires testing using the engine FTP. EPA believes 
that the FTP is the appropriate test cycle for determining compliance 
with the 0.10 g/bhp-hr standard, and that it is not appropriate to 
require Engelhard to conduct chassis testing to prove compliance with 
that standard.

d. Equipment Durability and In-service Concerns

    DDC provided several comments regarding durability. First, DDC 
states that the performance and durability of the ETX kit has not been 
demonstrated and that there is insufficient information in the 
Engelhard notification. DDC acknowledges that the urban bus retrofit/
rebuild regulations do not require such testing as a condition of 
certification, but expresses the concerns because trigger technology 
places requirements on transit operators. DDC notes that the ETX 
turbocharger is new, and without additional information, the effects of 
the turbocharger on the operational characteristics can't be assessed. 
DDC states concerns that the cylinder kits utilize DDC 15-to-1 nominal 
compression ratio piston domes modified to accept the GPX coating. The 
effective compression ratio of this cylinder kit is roughly 12.96 
compared to roughly 13.96 with the standard DDC piston dome. The 
reduction in compression ratio can have substantial effects on cold 
starting, cold smoke, and noise. Experience with the ETX kit for the 
MUI engine should not be taken as evidence of satisfactory cold 
starting and noise performance because injection timing and spray 
characteristics are different between the DDEC and MUI systems.
    JMI also provided several comments regarding durability. JMI notes 
that this ETX kit includes a new turbocharger, and that Engelhard 
should be required to provide durability data or history for the use of 
this part. Also, JMI states that Engelhard should be required to state 
which piston dome is used in the ETX kit, because of recent changes 
that DDC has made in certain design parameters in the piston dome, 
piston rings, and piston skirt of its 25 percent upgrade kit. JMI 
indicates that if the previous piston dome is used in the ETX kit, then 
transits should expect to incur problems related to the rings, and that 
Engelhard should modify its kit components and retest to confirm 
emissions data.
    Both NYCT and CTA comment about durability and reliability. CTA 
asks whether Engelhard has performed thorough and long term in-service 
reliability testing to ensure that the coated parts will last as long 
as standard, non-coated parts. CTA notes durability problems that they 
experienced with CMX converter model 0060, requiring replacement of 
over 200 units in their fleet, and asks how much testing was performed 
on the CMX-5 to ensure that problems will not be duplicated. 
Maintenance, testing and reusability of used converts is a concern. CTA 
also asks how a transit operator judges whether a converter is still 
functioning correctly, and whether the engine coatings will affect oil 
analysis and other maintenance programs.
    NYCT comments that there is virtually no in-service operation 
experience with the ETX kit, and states that such information is 
essential to show that the technology can function reliably on a large 
scale in daily operation. NYCT also states that it has experienced 
extraordinary costs using a previously certified Engelhard converter. 
NYCT has discovered that in certain circumstances the converter becomes 
plugged, which drastically reduces the service life of the units. The 
reduction in service life must affect the life cycle cost calculations. 
NYCT states that it has installed more than 1,500 Engelhard catalytic 
converters, and in-service back pressure checks have been very 
inconsistent and in some case are increasing. Two catalyst units are 
known to have plugged and have had to

[[Page 50229]]

be disassembled for repair. Increased back pressure results in greater 
fuel consumption, which should be included in the life cycle cost 
analysis.
    In response to the DDC comments, Engelhard states that the improved 
Engelhard turbocharger of the kit operates on the same principal as 
DDC's certified MUI kit utilizing the Turbodyne Turbopac--increased air 
flow and improved turbocharger response and that Engelhard has had 
urban bus DDEC engines operating with GPX for nearly 7 years, 
turbochargers in operation for over 100,000 miles, and diesel oxidation 
catalysts in operation for over 300,000 miles. A turbocharger has been 
in operation since December 1997 on a revenue-service DDC 6V92 DDEC II 
bus with no durability, performance or operational problems. Engelhard 
says that the transit operator is happy with the improved fuel economy 
and performance due to the installation of the turbocharger. A similar 
turbocharger has accumulated over 100,000 miles of normal operation on 
a Class 8 tractor trailer utilized by Engelhard.
    EPA notes that DDC does not specifically state what additional 
information on the Engelhard's turbocharger that it needs, and that 
Engelhard requests that information on the turbocharger remain 
confidential. Regarding the comment that the cylinder kit will reduce 
the compression ratio of the engine, Engelhard states that the 
statement is false and the combination of the coated cylinder head and 
coated piston is designed to maintain a compression ratio nearly 
identical to that of a standard cylinder head and piston.
    In response to the JMI comments, Engelhard states that it supplies 
the cylinder kits of the ETX kit, which it assembles from standard DDC 
parts, and Engelhard wishes that the specific part descriptions remain 
confidential. In its May 30, 1997 letter to EPA, DDC describes the 
changes that it made to its cylinder kits in order to improve cylinder 
kit life, and states that the design changes have no effect on engine 
performance or emissions. DDC also notes that the previous parts are to 
be discontinued. Based on the available information, EPA has no reason 
to believe that the parts of the ETX kit will negatively affect 
emissions. Also, EPA notes that the components, as part of the 
certified kit, are required to be covered by the program warranties.
    In response to the NYCT comments, Engelhard states that DDEC 
engines have been operating with GPX for nearly 7 years, turbochargers 
in operation for over 100,000 miles, and diesel oxidation catalysts in 
operation for over 300,000 miles. Over 500 buses (with MUI engines) 
have installed ETX kits with some in operation for over 18 months with 
no complaints about the coated components. The issue of coating 
durability was addressed during the certification process of the ETX 
kit for the MUI engines. If a coated component fails under warranty it 
will be replaced by Engelhard free of charge as specified in the 
emissions warranty. If one part of an ETX kit fails outside of the 
warranty, a transit will be able to purchase specific components having 
a standard Engelhard product warranty.
    Engelhard states that it has worked closely with CTA to resolve the 
early problems experienced with the CMX model 0060, which were caused 
by inherent design defects of the bus and engine installation. The 
engine in this bus model vibrates excessively and has continually 
destroyed engine mounts, OEM mufflers, and catalytic mufflers 
regardless of the supplier. The CMX 0060 has been redesigned to 
overcome the problems. Due to the bus design, correct muffler 
installation is critical for the muffler durability. Engelhard worked 
with CTA to ensure proper installation to prevent future failures. All 
units have been replaced at Engelhard's expense, including those that 
failed due to incorrect installation, vibration failure, and muffler 
design failures. Engelhard states that the problems experienced are 
caused by the original bus design and limited to this one particular 
bus and CMX combination. The particular bus model is essentially 
limited to CTA, and is therefore not a widespread problem. Engelhard 
solved all of the durability issues associated with this CMX unit with 
the Engelhard re-design, which includes strengthening the inlet and 
outlet pipe mounting points to the CMX body, upgrading the muffler 
material from aluminized steel to stainless steel, and revising the 
catalyst sleeving. This redesign will be incorporated in the CMX-5 
provided with the ETX kit.
    Regarding NYCT's catalyst comments, Engelhard states that NYCT's 
problematic units were supplied by DDC and Donaldson as trap 
replacement converter mufflers, and do not have an Engelhard warranty. 
As a result, Engelhard does not know the history of the units. 
Engelhard and its distributor have been working very hard with NYCT to 
resolve their problems. Engelhard strongly suspects that the problem is 
caused by engine malfunctions and engine failures, because the 
catalysts have been installed for several years at this point in time, 
and the engines were probably not rebuilt prior to catalyst 
installation (since the catalysts were trap replacement units). 
Certified catalysts, which began to be installed since the end of 1995, 
are generally installed at the time an engine is rebuilt. When an 
engine begins to fail it starts to use excessive oil and emit 
particulate that have a very high soluble organic fraction, which can 
result in plugging. The 2 catalyst units that NYCT references as being 
plugged are Donaldson units in-use for 4 to 5 years (possibly beyond 
the 100,000-mile warranty period that would have been applicable to a 
certified catalyst), and the engines were not rebuilt prior to 
installation of the catalysts. Engelhard has offered to reclaim some of 
these Donaldson units for no cost to NYCT, but is under no warranty to 
provide the service.
    Regarding the in-service back pressure checks conducted by NYCT, 
Engelhard has told EPA in a telephone conversation, that back pressure 
can vary due to several factors, including the amount of prior idling, 
and ambient pressure.
    EPA notes that the NYCT comments reference several problems with 
catalysts. For several reasons, however, EPA does not believe that 
there is clear evidence that it is appropriate to apply additional 
costs, either in terms of additional fuel consumption or maintenance, 
to the life cycle cost analysis. First, catalysts used to replace 
exhaust traps are not certified under the urban bus program, and it is 
not clear that all in-service experience with such catalysts are 
relevant to certified catalysts. (Pursuant to an agreement between DDC 
and EPA, Donaldson traps were removed, because of severe durability 
concerns, and replaced with catalytic converter-mufflers.) As Engelhard 
notes, the problems NYCT has experienced occurred with uncertified 
trap-replacement catalysts, not those certified under the urban bus 
program, and the units were installed on engines that were not rebuilt 
prior to installation. Second, NYCT does not present any data for 
quantifying additional costs. NYCT does not indicate how much fuel 
economy is affected by any in-use increases in back pressure, or how 
often catalyst cleaning is necessary and how much time and material are 
required for cleaning. NYCT comments do not substantiate that a 
reduction in service life is due to catalyst plugging, or that 
additional maintenance for cleaning the catalyst is necessary. EPA 
notes that, from the information provided in NYCT's comments, 2 units 
plugged out of 1500, and that these were trap-replacement

[[Page 50230]]

units. Engelhard's service procedure for the CMX notes that ``catalytic 
converter mufflers are susceptible to plugging if the engine is 
operated under low load conditions for extended periods of time while 
(a) the engine is improperly maintained; or (b) the engine is not 
properly calibrated for the specific fuel type and use of the catalytic 
muffler.'' At this time, EPA does not have adequate basis to either 
confirm that additional maintenance or fuel consumption occurs with 
properly installed certified catalysts, or to quantify additional 
costs.
    Regarding CTA's concern about re-use of catalytic converters, 
Engelhard states that it understands that operators would like to re-
use catalytic mufflers, but a used catalyst is an unknown quantity. A 
method for accurately testing PM performance of a catalyst in the field 
does not exist. Therefore, Engelhard requires that a complete kit be 
installed for warranty purposes.
    Engelhard states that the ETX kit does not need or require any 
additional maintenance above the recommended DDC maintenance and, in 
general, CMX converter mufflers do not require preventative maintenance 
if the engines are operating properly. All analysis and maintenance 
programs conducted by transit operators should continue as they are 
now.
    EPA has previously certified an Engelhard equipment package 
utilizing GPX coatings (60 FR 47170, September 11, 1995). From the 
standpoint of physical durability of the coating, EPA is not aware of 
any premature wear or failure of this certified equipment. As mentioned 
previously, in response to concerns about the physical durability of 
the new GPX-5m coating, in a May 23, 1996 letter to EPA, Engelhard 
provided data from three in-use buses using previous generation GPX-4 
coatings. Coating thickness measurements were made on piston crowns and 
cylinder head combustion chambers, and were found to be within nominal 
design specifications at an average of 123,000 miles. In addition, 
deposit formations on the combustion surfaces were nearly non-existent. 
Engelhard indicates that design advances in the current GPX-5m coatings 
are intended to further reduce deposit formation and increase coating 
durability beyond that of the GPX-4 coating.
    EPA appreciates that transit operators are concerned with the 
durability of retrofit/rebuild equipment, and subsequent additional 
costs or engine damage that potentially could result from premature 
equipment failure. However, EPA notes that the urban bus retrofit/
rebuild regulations do not require an in-service durability 
demonstration as a condition of certification. Rather, equipment 
certifiers, including Engelhard, are required pursuant to 40 CFR 
85.1409 to provide a 100,000 mile equipment defect warranty and a 
150,000 mile emissions performance warranty.
    EPA believes that equipment suppliers will evaluate the durability 
of their equipment in order to minimize their liability resulting from 
the emissions defect and performance warranties. EPA believes that the 
available information does not indicate a durability concern with the 
equipment certified in today's notice, and therefore, does not provide 
sufficient basis to deny certification on these grounds. EPA will 
continue to monitor problems with this, and other certified equipment, 
and encourages transit operators to provide specific detailed 
information regarding in-service problems with certified equipment.
    The equipment certifier is responsible for the emissions 
performance of the engine through the 150,000 mile emissions 
performance warranty period, if the transit properly installs and 
maintains equipment in accordance with the equipment manufacturer's 
instructions. The transit operator is responsible for proper 
installation and use of certified equipment, and is responsible for the 
emissions performance of equipment operated beyond the 150,000 miles 
emissions warranty period. Also, the retrofit/rebuild program does not 
obviate compliance with any state or local emission requirements, such 
as inspection/maintenance (I/M) or smoke testing programs.

e. Installation Instructions

    DDC comments on several items of Engelhard's ETX ``Installation 
Instructions'' for the ETX kit that were unclear, contain errors, and/
or lack appropriate instructions or information.
    Engelhard agrees with DDC's comments, admits that these items are 
not necessary for installation of the ETX, and Engelhard will remove 
the requirements from the guidelines. Engelhard notes that the 
guidelines were originally developed for installation of GPX in any 
engine, and provided rebuild suggestions intended to prevent incorrect 
engine assembly.
    EPA appreciates DDC's in-depth review of the instructions, but does 
not believe a detailed review of each item is necessary in today's 
Federal Register notice. Details of these comments are in DDC's letter 
to EPA dated May 22, 1998, which is available to interested parties in 
the public docket referenced above.

f. Catalyst Checking Procedure

    Both JMI and DDC provided comments expressing opposition to the 
procedure recommended by Engelhard for determining whether the catalyst 
unit requires cleaning. JMI comments that Engelhard, in its procedure 
to determine whether the CMX-5 is operating properly, should be 
required to change its procedure to match DDC's, which states that 
exhaust back pressure measurements should be taken at wide open 
throttle and full load.
    CTA asks whether the issue of back pressure exceeding DDC's limits 
has been addressed and resolved.
    Engelhard's instructions involve operating the engine in a rated 
speed, no load condition (high idle) and recording the pressure drop 
across the CMX-5 unit. This is the same procedure recommended by 
Engelhard for determining back pressure across the original CMX 
catalytic muffler, and was derived from DDC Service Information 
Bulletin 7-D-95. DDC, however, contends that this service procedure was 
only intended for a limited population of 6V92TA engines that were 
originally equipped with particulate traps. (Pursuant to an agreement 
with EPA, these traps were removed because of durability concerns, and 
replaced with catalytic converter-mufflers.) DDC's states that its back 
pressure limits apply at all engine operating conditions, including the 
point of maximum exhaust flow which occurs at rated engine speed, full 
load. An exhaust system which just meets DDC's specified back pressure 
limit at WOT, no load (which is how the Engelhard procedure is 
conducted) will exceed the DDC limit over a large portion of the engine 
speed/load operating map and thus would be in violation of DDC's 
guidelines. Excessive back pressure results in fuel economy and power 
losses, and raises cylinder temperatures and increases soot build-up in 
the lubricating oil. These effects can reduce engine life.
    Engelhard states that there is no difference between the specific 
1993 engine models for which the DDC procedure applies, and the other 
standard DDEC II engines. EPA notes that DDC has provided no 
explanation of the difference, in terms of susceptibility to back 
pressure impacts, between the engines for which Service Information 
Bulletin 7-D-95 was intended, and those which are covered by this, and 
other, retrofit certifications utilizing catalytic mufflers.

[[Page 50231]]

    Regarding back pressure of the CMX units on the CTA buses discussed 
above, Engelhard states that in testing done by Donaldson, the OEM 
muffler had a back pressure of 3.7 inches Hg at full load. The CMX 
actually has a back pressure equal to or lower than the OEM muffler. In 
all cases the CMX-5 converter mufflers meet the back pressure 
limitations of the OEM muffler designs and DDC specifications.
    EPA is not requiring Engelhard to revise the screening procedure, 
for several reasons. First, and in general, the program regulations do 
not require any specific check procedures for any components of 
certified kits. Second, EPA notes that the maximum exhaust back 
pressure specification for several engine calibrations (codes) of the 
6V92TA DDEC II engines is 4.0 inches of mercury (as specified in DDC's 
application for certification of 1991 and 1992 6V92TA DDEC engines 
under EPA's new engine certification program), and that the back 
pressure specification for the Engelhard procedure is 3.0 inches of 
mercury. Third, the Engelhard procedure is intended as a ``screen'' to 
determine whether a catalyst muffler needs cleaning, not to measure 
exhaust back pressure for comparison with DDC's maximum specifications. 
For additional discussion of the issue, refer to page 12177 of the 
Federal Register notice describing certification of the ETX kit for 
6V92TA MUI engines (62 FR 12166, March 14, 1997.
    Any future information provided by interested parties regarding the 
impacts of certified equipment on exhaust back pressure would be taken 
under consideration. EPA appreciates that there may room for 
improvement in maintenance procedures of equipment certified under this 
program. Such concerns, in general, can also occur with procedures 
relating to new engines. EPA encourages all equipment certifiers to 
issue revised check procedures when appropriate. If Engelhard 
determines that another check is appropriate, or if EPA becomes aware 
that back pressure is exceeding manufacturer limits on in-use buses, 
then Engelhard should revise such procedures. Pursuant to 40 CFR 
85.1413, EPA has authority to decertify equipment that does not comply 
with the requirements of the regulations.

g. Components of the Kit

    Engelhard has proposed to exclude certain parts from the ETX kit, 
which are typically replaced during a standard rebuild. JMI comments 
that Engelhard should include the fuel injectors, camshafts, and blower 
in the ETX kit, and provide program warranty coverage for the parts. 
JMI feels these parts should be included in the kit because the parts 
are emissions related.
    Engelhard will make available two ETX kits--one for the 1988 
through 1990 model year engines, and the other for 1991 through 1993 
model year engines. The particular kit required for any specific engine 
will be determined by the DDC parts list requirement for the engine, 
which will be determined by engine serial number. The kits differ as 
described below. Applying the kit upon engine rebuild will result in 
engines configured to one general (physical) ETX configuration. A 
difference will be the ECM programming, which is related to power 
rating, fuel type, and engine rotation direction.
    The ETX kit for the 1988--1990 model year engines will include fuel 
injectors and engine camshafts. The kit for the 1991--1993 will not 
include the fuel injectors or engine camshafts. Neither kit will 
include the blower assembly. The injectors and camshafts that must be 
used with the ETX kit are common, non-unique, rebuild components for 
the 1991--1993 model year engines, and therefore, not required to be in 
the certified kit for 1991--1993 model year engines. A transit operator 
would typically acquire the same parts for a ``standard'' engine 
rebuild of a 1991 through 1993 model year engine, and the operator is 
responsible for doing so when using the ETX kit. These parts (fuel 
injectors, engine camshafts, and blower assembly) are required to be 
the specified DDC-supplied components, because the DDC components were 
used for the certification testing. In a letter from DDC to EPA dated 
June 12, 1996, DDC states that there were no emission related design 
changes made to the blower between 1988 and 1991. Therefore, EPA does 
not require the blower to be included with the ETX kit because it is 
not unique for the applicable engines. Engelhard is required to provide 
program warranty coverage only for parts included with the kit.
    The ETX kit includes a list of the specific engine rebuild parts 
that are required to be used upon engine rebuild with the ETX kit. EPA 
notes that in accordance with 85.1404, operators are required to 
maintain records of all parts used in rebuilds. Using incorrect 
components with the ETX kit at the time of kit installation can be 
considered as failure to install a certified kit under the urban bus 
rebuild requirements, and subject the operator to the significant 
penalties provided by the regulation.

h. Life Cycle Cost

    EPA requested comments on the life cycle cost analysis in the 
Federal Register notice of April 9, 1998 (63 FR 17411) which summarized 
the Engelhard notification and made it available for public comment. 
Section 1403(b) of the program regulations describe those items which 
must be considered when analyzing life cycle cost of equipment, 
including equipment purchase price, incremental fuel cost/savings, 
installation costs, maintenance costs, and other costs specific to fuel 
additives and fuel conversions. All commenters provided input on at 
least one cost-sensitive topic area. The comments received are 
described below, and are grouped by general item or topic.
    JMI comments that Engelhard should substantiate the validity of the 
$6,966 that Engelhard uses (in their October 21 notification) for the 
cost of a standard rebuild, and that EPA should scrutinize that figure 
and subject it to the ``weighted rebuild'' cost analysis that was 
completed for the Engelhard 0.10 g/bhp-hr MUI certification. EPA's 
determination of life cycle costs is presented below in this section. 
EPA's position on comments or issues, and scrutiny and analysis of life 
cycle costs, are discussed below.
1. Comments on Purchase Price
    Both DDC and JMI comment that Engelhard should include the cost of 
reprogramming in the life cycle cost.
    In response, Engelhard states that it will include the necessary 
ECM reprogramming as part of the cost of the ETX kit.
2. Comments on Maintenance Cost
    NYCT comments that it does not know the details of maintenance 
required for the ETX kit, but it is confident that there is some 
maintenance required, and the cost of such maintenance should be 
included in the life cycle cost calculations.
    Engelhard states that the ETX kit does not need or require any 
additional maintenance above the recommended DDC maintenance. Engelhard 
notes that, as with any engine there is a certain amount of up-keep 
required. In the ETX application, Engelhard has stated that no 
additional maintenance is required above and beyond the standard 
maintenance specified by DDC for the 6V92 DDEC engine. Because the 
maintenance requirement is identical to a standard engine, a cost of 
maintenance is not necessary for the life cycle cost calculation. 
Additionally, Engelhard maintains that the CMX-5 catalyst unit

[[Page 50232]]

is maintenance-free over the emissions performance warranty period of 
150,000 miles, and notes that the currently certified CMX has been in 
operation for over a year.
    EPA believes that the engine upgrade portion of this equipment 
requires no additional maintenance incremental to that required on a 
standard rebuild. In addition, the coated component portion of the kit 
cannot be serviced because the coated parts are internal to the engine. 
Therefore, no additional maintenance is expected related to the coated 
components. Regarding the catalyst unit, EPA has not seen any clear and 
convincing information that it requires periodic maintenance during its 
warranted lifetime, on properly operating engines. Therefore, in the 
life cycle cost analysis presented below, EPA assumes that the ETX kit 
does not require any additional maintenance above the recommended DDC 
maintenance.
3. Comments on Fuel Consumption
    NYCT comments that the ETX kit will have a fuel penalty, when based 
on bus operating profiles, that is greater than the $1,315 determined 
by Engelhard based on the FTP certification engine test cycle.
    Both DDC and JMI comment that the test data indicate one percent 
increase in fuel consumption between the ETX (0.503 lb/bhp-hr) and the 
1991 DDEC engine test (0.498 lb/bhp-hr), and that this cost impact 
should be included in the life cycle cost analysis. JMI states that 
Engelhard's standard rebuild engine (a California configuration) is not 
an appropriate baseline for fuel consumption impact because the 
California standard for NOX (6.0 g/bhp-hr) is lower than the 
49-state standard (10.7 g/bhp-hr), and an engine operating with lower 
NOX emissions has higher fuel consumption. Also, it is 
improper to use the DDC DDEC II 25% upgrade kit fuel penalty, because 
the ETX kit uses a different turbocharger, and calls for Engelhard to 
conduct a baseline test on a 1988 federal engine. JMI has accumulated 
test data from a 1988 federal engine, and has made this data available 
to EPA. The data show a brake-specific fuel consumption (BSFC) for a 
1988 federal configuration 6V92TA DDEC II engine of 0.460 lb/bhp-hr. 
JMI presents this data solely to illustrate that there is a difference 
between 1988 federal and California engines, and not to suggest that 
Engelhard should use JMI's baseline data.
    With regard to NYCT's comment about fuel consumption, Engelhard 
responds that the fuel consumption data was generated during the 
Federal Test Procedure (FTP) as specified by the urban bus rebuild 
regulations. Therefore, Engelhard must use it as the basis for the life 
cycle cost.
    EPA notes that 40 CFR 85.1407 (a)(3) states, in part, that 
certifiers must include in their notification of intent to certify 
``(t)he percent change in fuel economy * * * based on testing performed 
over the heavy-duty engine Federal test procedure or an approved 
alternative test procedure''. Engelhard complied with this requirement 
by providing the percent change in fuel economy resulting from use of 
the ETX kit as measured over the heavy-duty engine Federal test 
procedure (FTP) described at 40 CFR Part 86 Subpart N. In addition, in 
order to demonstrate compliance with the 0.10 g/bhp-hr PM, and other 
regulated exhaust emissions standard, testing must be conducted using 
the engine-based FTP. Therefore, the procedure used by Engelhard is in 
compliance with program requirements, and EPA is not requiring 
Engelhard to perform testing beyond the program requirements.
    Regarding the JMI and DDC comments that the data show a one percent 
fuel consumption penalty when the ETX kit is applied to 1991 model year 
engines, Engelhard has submitted, in one of its letters dated June 15, 
1998, data from one additional test of the ETX configuration and two 
additional tests of the original DDC 1991-1993 model year 
configuration. The fuel consumption data, referred to as brake specific 
fuel consumption (BSFC), is measured in units of pounds of fuel per 
unit of engine work, or brake-horsepower-hour (lb/bhp-hour). The 
totality of fuel consumption data provided by Engelhard is summarized 
below in Table 3. All of this testing was conducted in the same test 
cell using the same basic engine (and power rating).

             Table 3.--Engelhard Baseline and ETX Test Data             
------------------------------------------------------------------------
            Test description                 BSFC \1\         Average   
------------------------------------------------------------------------
ETX Kit (277 hp)........................           0.503  ..............
ETX Kit (277 hp)........................           0.513           0.508
1991 50-s (277 hp)......................           0.498                
1991 50-s (277 hp)......................           0.519                
1991 50-s (277 hp)......................           0.511           0.509
1988 50-s (277 hp)......................           0.481           0.481
------------------------------------------------------------------------
\1\ Brake-specific fuel consumption measured in units of pounds of fuel 
  per brake horsepower-hour.                                            

    The average fuel consumption of the two ETX tests (0.508 lb/bhp-hr) 
indicate that the ETX kit will present no fuel consumption penalty when 
compared to the average of three tests in the 1991 model year 
configuration (0.509 lb/bhp-hr). Also, the data indicate that 
installing the ETX kit on 1988 through 1990 50-state (California) 
engines will result in 5.6 percent increase in fuel consumption 
(comparing 0.508 to 0.481).
    With regard to JMI's comment that Engelhard should conduct baseline 
testing using a 1988 model year 49-state (federal) engine, this data is 
not available (Engelhard has not conducted testing on a 1988 model year 
configuration). With regard to Engelhard's use of DDC data (supplied by 
DDC during the certification process for its 25-percent DDEC upgrade 
kit) for Engelhard's life cycle cost analysis, EPA believes that it is 
not the most accurate way to determine fuel consumption impact because 
of variables such as engines of different power ratings, in different 
test cells, and being conducted two years apart. Additionally, because 
different test cells were used, EPA agrees with JMI that it is not 
appropriate to use JMI's 1988 federal engine data as a baseline to 
compare data from ETX testing conducted for Engelhard. Instead, EPA 
believes that other data, as discussed below, is adequate to determine 
the impact of the ETX kit on 1988 through 1990 model year 49-state 
(federal) engines.
    In a telefax to EPA dated June 5, 1998, JMI provided documentation 
of testing the 1988 model year federal 6V92TA that is referenced in its 
above-mentioned comments. Additionally, JMI provided documentation from 
testing a

[[Page 50233]]

1992 model year 6V92TA, in its notification of intent to certify 
equipment dated March 6, 1998. EPA believes that these test data, 
performed on 277 hp engines in the same test cell, can be used to 
compare a 1991 configuration (the 1992 model year is considered 
equivalent to the 1991) with a 1988 configuration. EPA believes that 
the difference predicted by these data will be equivalent to the impact 
on 1988-1990 engines resulting from installation of the ETX kit, 
because the above-mentioned ETX testing indicates that the ETX kit will 
result in no increased consumption compared to 1991 model year engines. 
The JMI test documentation show a measured fuel consumption of 0.483 
lb/bhp-hr for the 1992 engine, which is 5.2 percent greater than the 
0.459 lb/bhp-hr measured for the 1988 engine. These data predict that 
1988 through 1990 model year configurations will experience 5.2 percent 
increased fuel consumption when equipped with the ETX kit. This level 
of impact is generally supported by the above-mentioned DDC data. That 
DDC data, as noted by Engelhard in its October 21, 1997 notification, 
shows an impact of 4.7 percent. The 5.2 percent impact predicted using 
the JMI data is greater than originally proposed by Engelhard (based on 
the DDC data) in its notification of October 21. Also, EPA believes use 
of the JMI data is more accurate because it was conducted using two 
configurations (1992 and 1988 model years) of the same power rating in 
the same test cell. The testing conducted by JMI can be found in the 
public docket located at the above address.
    EPA recognizes that the available data is limited, but believes it 
adequate for the purpose of determining the life cycle cost analysis. 
In summary, the installation of the ETX kit on 1991-1993 model year 
engines is determined to result in no additional fuel consumption, on 
1988-1990 50-state (California) engines is determined to result in 5.6 
percent increased fuel consumption, and on 1988-1990 49-state (federal) 
engines is determined to result in 5.2 percent increased in fuel 
consumption. The impact of increased fuel consumption on life cycle 
costs is determined below.
4. EPA Determination of Life Cycle Cost
    Section 1403(b)(1)(ii) describes those items which must be 
considered when analyzing life cycle cost of equipment, including 
equipment purchase price, incremental fuel cost, installation costs, 
maintenance costs, and costs of any fuel additives required. To trigger 
the 0.10 g/bhp-hr standard, the life cycle cost of equipment can be no 
more than $7,940 (in 1992 dollars), incremental to the cost of a 
standard rebuild.
    In this section, EPA analyzes the life cycle costs using a 
methodology similar to that described in the Federal Register notice of 
March 14, 1997, which describes the certification of Engelhard's ETX 
kit applicable to DDC's 6V92TA engines with mechanical unit injectors 
(MUI). The analysis first determines the cost of a ``weighted'' 
rebuild, which reflects operators' use of non-original equipment parts 
and rebuilding certain components in-house. The weighted rebuild 
``corrects'' all cost information to a 1992 base, which is the time 
period for which the life cycle cost limit of $7,940 is based. EPA uses 
the cost of a weighted rebuild to represent the cost of a standard 
rebuild, which is then used to determine a maximum allowable purchase 
price such that the life cycle cost of the equipment meets the life 
cycle cost limit. The maximum purchase price, when added to the 
incremental fuel penalty and installation cost, and offset by the value 
of displaced standard rebuild parts, must be no more than $7,940 (in 
1992 dollars), incremental to the cost of a standard rebuild.
    i. Cost of a standard rebuild. Engelhard presented a life cycle 
cost analysis in its notification signed October 21, 1997, and made 
changes to the analysis in subsequent letters to EPA. The Engelhard 
analyses rely on DDC suggested list prices to determine the cost of a 
``standard'' rebuild. Engelhard, in one of its letters dated June 15, 
1998, provides a letter from Atlantic Detroit Diesel-Allison with 
current suggested list prices for DDC parts. Table 4 below presents OE 
list prices presented by Engelhard for the standard rebuild parts 
affected by the ETX kit. In the table, EPA has corrected the 
information to a 1992 time period, using a multiplicative ratio of 
Consumer Price Indices (CPI). The average CPI for 1992 is 140.3, as 
specified by the program regulation. The April 1998 CPI, for all items 
and all urban consumers, is 162.5. These values are available from the 
U.S. Department of Labor, Bureau of Labor Statistics.

                                 Table 4.--Original Equipment (OE) Parts Prices                                 
----------------------------------------------------------------------------------------------------------------
                                                                                                       Price    
                                                OE suggested                                       corrected to 
            Item in kit (quantity)               list price     Normally replaced at overhaul ?   1992 (based on
                                                                                                       CPIs)    
----------------------------------------------------------------------------------------------------------------
Cylinder Kits (6)............................          $2,394  Yes..............................          $2,067
Gasket Kit (1)...............................             207  Yes..............................             179
Fuel Injectors (6)...........................           1,688  Yes..............................           1,457
LB Camshaft (1)..............................             854  Yes..............................             738
RB Camshaft (1)..............................             731  Yes..............................             631
Blower Ass'y (1).............................             575  Yes..............................             496
Turbo Ass'y (1)..............................             890  Yes..............................             768
Heads Ass'y (2)..............................           1,166  Yes..............................           1,007
ECM Program (1)..............................           (\1\)  No...............................  ..............
    Totals...................................          $8,505  .................................         $7,343 
----------------------------------------------------------------------------------------------------------------
\1\ Not required.                                                                                               

    Engelhard, in one of its letters dated June 15, 1998, states that 
it is their experience that almost all major transits in major 
metropolitan areas use 100 percent DDC parts. Therefore, non-OE parts 
do not affect the life cycle cost. Also, Engelhard states that, 
although at one time a common practice, today virtually no large urban 
transit companies re-manufacture their own components (such as 
turbochargers, blowers, and heads). Engelhard further notes that in-
house engine rebuilding refers to the process of disassembling and 
reassembling the engine, and that this is different from re-
manufacturing engine components.

[[Page 50234]]

    In response to Engelhard's comments about the current practice of 
(not) re-manufacturing components in-house, EPA believes that the 
current practice is not relevant. Instead, the relevant practice is the 
amount of in-house re-manufacturing at the point in time when the life 
cycle cost ceiling was established (that is, in the 1992-1993 time 
frame). EPA acknowledges that industry practice may have changed since 
1993, for various reasons, such as general industry trends, or perhaps 
the urban bus program certification of kits that include most emissions 
related parts. However, at the relevant point in time (1993 or 
earlier), EPA believes that a significant number of transits re-
manufactured parts in-house. EPA understands Engelhard's comment 
concerning the difference between in-house engine rebuilding and 
component re-manufacturing, but the practice of in-house re-
manufacturing is supported by Engelhard's comments (``at one time this 
was a common practice . . .'') and EPA telephone conversations with 
transit operators. Therefore, for the determination of the cost of a 
weighted rebuild, EPA assumes that some parts used in the rebuild of 
engines are non-OE parts, and that most transits re-manufacture certain 
components in-house.
    In comments related to certification of its ETX kit for 6V92TA MUI 
engines, Engelhard stated that the weighted cost approach should be 
adjusted to reflect an additional cost to transit operators who rebuild 
in-house, because parts are occasionally not rebuildable due to 
catastrophic failure. EPA is retaining this methodology for determining 
the cost of a weighted rebuild for DDEC engines. Engelhard stated that 
10 percent of turbochargers and blowers are not rebuildable, and that 
50 percent of cylinder heads are not rebuildable. When parts are non-
rebuildable, a transit operator would typically purchase a new 
component at fleet cost. The nominal cost of these components assumes 
the exchange of a rebuildable core. If the core is not rebuildable, 
then the operator pays a core charge plus the nominal cost of the 
component. The sum of the component fleet price plus the core charge 
represent additional costs to fleets that rebuild in-house, due to non-
rebuildable parts. When weighted based on the frequency at which the 
part is non-rebuildable, it yields an additional cost on a per-
component basis. Consistent with the past cost analysis, EPA assumes 
in-house rebuild of three components: the turbocharger, the blower, and 
the cylinder heads. Table 5 below summarizes estimates of the 
additional costs related to the in-house rebuild of these parts.
    Also, EPA has included injectors in Table 5 below, based on new 
information presented by Engelhard in one of its letters dated June 15, 
1998. Engelhard stated that injectors should be included in this table 
because operators normally purchase rebuilt injectors that have a core 
charge. The 1998 core charge is $200 per injector and approximately 10 
percent fail, but since the list price of a new injector is $604, an 
operator will pay the core charge and still purchase a rebuilt 
injector.

                               Table 5.--Core Cost Impact of Non-rebuildable Parts                              
                                                 [1992 Dollars]                                                 
                                                                                                                
                                         OE                     In-house                                        
               Item                  suggested     OE fleet     rebuild      Fraction   Core charge   Total cost
                                       price        price         cost       damaged        (1)       to transit
A                                             B            C            D            E            F            G
1  Injector.......................         $243         $224           NA         0.10         $173         $242
Blower............................          496          459         $223         0.10          474          294
Turbo.............................          768          710          346         0.10          288          411
1  Head...........................          503          465          227         0.50          395          543
----------------------------------------------------------------------------------------------------------------

    The OE Fleet Prices for the blower, turbocharger, and cylinder 
heads are estimated by EPA, using the same ratio of the prices for 
these parts set forth during the certification process of the ETX kit 
for 6V92TA MUI engines. Core charges for the blower, turbocharger, and 
cylinder head are estimated by EPA based on the fractions (of OE 
suggested prices) as the values EPA used in the methodology of the 
analysis of weighted rebuild in the ETX 0.10 MUI kit. The core charge 
for the injectors is provided by Engelhard in one of its letters dated 
June 15, 1998. In-House Rebuild Costs are 45% of OE suggested prices, 
based on JMI comment relating to certification of the DDC MUI 25% 
upgrade kit (60 FR 51472, October 2, 1995).
    For the blower, turbocharger, and heads, Table 5 above makes a 
correction to the calculation described in the July 19, 1996 Federal 
Register (61 FR 37738). Table 5 determines a weighted Total Cost to 
Transit, based on the fraction of parts damaged. Total Cost to Transit 
= (1-E)(D)+(E)(C+F) for the blower and turbocharger. For the cylinder 
heads, the Total Cost = (D)/2 + (C+F)/2, which is an average cost for 
one head. For fuel injectors, the Total Cost = (1-E)(C)+(E)(C+F) per 
injector.
    Table 6 below summarizes the cost of a weighted rebuild (in 1992 
dollars) including adjustments to the above components.

                                      Table 6.--Cost of a Weighted Rebuild                                      
                                                 [1992 Dollars]                                                 
----------------------------------------------------------------------------------------------------------------
                                                                OE list                   OE fleet     Weighted 
                         Item in kit                             price     Non-OE cost     price       rebuild  
----------------------------------------------------------------------------------------------------------------
1  Cylinder Kit.............................................       $2,067       $1,049       $1,777       $1,540
2  Gasket Kit...............................................          179          134          153          147
3  Fuel Injectors...........................................        1,457           NA        1,346        1,450
4  LB Camshaft..............................................          738          553          632          606
5  RB Camshaft..............................................          631          473          541          519
6  Blower Ass'y.............................................          496          294          459          302
7  Turbo Ass'y..............................................          768          411          710          424
8  Heads Ass'y..............................................        1,007        1,087          930        1,079

[[Page 50235]]

                                                                                                                
9  ECM Program..............................................        (\1\)        (\1\)        (\1\)        (\1\)
    Totals..................................................        7,343  ...........  ...........       6,067 
----------------------------------------------------------------------------------------------------------------
\1\ Not required.                                                                                               

    The non-OE cylinder kit cost is based on an Engelhard comment dated 
July 19, 1995, that the aftermarket cylinder kit costs 1,139.94, 
corrected to 1992 dollars (the CPI for June 1995 is 152.5). The prices 
of non-OE gasket kit and camshafts are 75% of the 1992 corrected OE 
prices, based on 25 percent discount from OE list prices, as discussed 
in the March 14, 1997 Federal Register notice (62 FR 12177). The OE 
Fleet Prices are estimated by EPA, as the same fractions (of OE 
suggested prices) as the values EPA used in the analysis of the 
Engelhard 0.10 MUI kit.
    As was done in the analyses of a MUI weighted rebuild, EPA makes 
two adjustments to its analysis of the cost of a weighted rebuild. 
First, all costs are corrected to 1992 dollars. Second, the weighted 
rebuild is modified to reflect non-OE parts costs that are 25 percent 
less than OE cost.
    For the cylinder kits, gasket kit, and both camshafts, a weighted 
cost is determined as the sum of the non-OE cost, weighted 32.6 
percent, plus the DDC suggested cost of parts, weighted 67.4 percent. 
This weighting is based on the APTA survey showing the relative split 
in operators' parts business between OE and non-OE parts suppliers. The 
APTA survey (American Public Transit Association Transit Bus Diesel 
Engine Rebuilding Survey by Michael J. Meloche, January 1991) indicates 
that 67.4% of operators parts business is with OE parts suppliers, and 
32.6% is with non-OE suppliers. The APTA survey can be found in the 
public docket at the above address. The cost of the fuel injectors are 
determined above in Table 5. Based on the APTA survey, 95.5 % of the 
blower, turbochargers, and heads are assumed to be re-manufactured in-
house at the Non-OE Costs, and the balance purchased at OE fleet 
prices. The ECM is not reprogrammed during a standard rebuild.
    EPA recognizes that there are a number of uncertainties and 
assumptions involved with this ``weighted'' approach, but believes, 
based on the available information, that the cost of a standard rebuild 
of a DDC 6V92TA DDEC engine is best approximated by the weighted 
rebuild costs shown above in Table 6, for the purposes of determining 
the maximum allowable purchase price for the Engelhard ETX kit.
    ii. Incremental fuel cost. The percentage fuel consumption impacts, 
as discussed in above Section 3, are shown below in Table 7 along with 
the impact due to increased life-time fuel costs pursuant to the 
calculations of 40 CFR 85.1403(b)(1).

              Table 7.--Fuel Consumption Impact of ETX Kit              
                             [1992 dollars]                             
------------------------------------------------------------------------
                                                           Fuel penalty 
            Applicable engine              Percent BSFC     per 40 CFR  
                                              impact       85.1403(b)(1)
------------------------------------------------------------------------
1988-1990 49-s..........................            -5.2        ($1,473)
1991-1993 49-s..........................             0.2              0 
1988-1990 50-s..........................            -5.6         (1,581)
------------------------------------------------------------------------

    iii. Installation costs. As defined in 40 CFR 85.1403 
(b)(1)(ii)(B), the installation cost of certified equipment is ``the 
labor cost of installing the equipment on an urban bus engine, 
incremental to a standard rebuild, based on a labor rate of $35 per 
hour'' (in 1992 dollars). Engelhard states that the labor required to 
rebuild an engine will be the same for a standard rebuild and the ETX 
kit, with the exception of the additional labor required for 
installation of the CMX catalytic muffler. The urban bus engines for 
which this equipment is intended were not originally equipped with 
catalytic convertors. Therefore, the muffler unit must be removed from 
the engine, and the CMX-5 unit installed in its place. Engelhard states 
that installation of the CMX-5 catalyst unit requires a maximum time of 
six hours to install on an urban bus engine. Using the labor rate of 
$35.00 per hour, as specified in the regulation (40 CFR 85.1403), the 
six hours is valued at $210 (in 1992 dollars). The $210 is incremental 
to the cost of a standard rebuild.
    iv. Maintenance costs. Engelhard states that after installation of 
the ETX kit, an engine will require no maintenance above the standard 
rebuild. EPA has no information to conclude that any additional 
maintenance is necessary for the CMX-5 catalyst muffler, or would 
increase life cycle costs. Therefore, no additional maintenance costs 
are listed for the ETX kit.
    v. Costs of fuel additives. No fuel additives are required for the 
ETX kit.
    vi. Total life cycle cost calculation. The regulation at 40 CFR 
85.1403 requires that the life cycle cost, for equipment that triggers 
the 0.10 g/bhp-hr standard, be no more than $7,940 (in 1992 dollars) 
incremental to the cost of a standard rebuild. Table 8 below summarizes 
the life cycle costs for the ETX kit for each of the three groups of 
applicable engines: 1988 to 1990 model year 49-state engines, 1988 
through 1990 model year 50-state engines, and 1991 through 1993 model 
year 50-state engines. Separate summaries are presented because of the 
differing kits, and the different fuel penalty determined for each 
group.

[[Page 50236]]



                                           Table 8.--Life Cycle Costs                                           
                                                 [1992 dollars]                                                 
----------------------------------------------------------------------------------------------------------------
                                                                                Applicable engines              
                                                                 -----------------------------------------------
                                                                   1988-1990 49-   1991-1993 49-   1988-1990 50-
                                                                       State           State           State    
----------------------------------------------------------------------------------------------------------------
Maximum Allowable Purchase Price................................        $11,876         $10,774         $11,768 
Offset for kit parts normally replaced during a standard rebuild         (5,619)         (3,044)         (5,619)
Installation Cost...............................................            210             210             210 
Fuel Penalty....................................................          1,473               0           1,581 
Total Incremental Life Cycle Cost...............................          7,940           7,940           7,940 
----------------------------------------------------------------------------------------------------------------

    The table displays the maximum allowable purchase prices for the 
ETX kits, in 1992 dollars. The total incremental life cycle cost is the 
sum of the listed items. An ``offset'' is provided to the life cycle 
cost because certain components provided in the ETX kits offset costs 
for parts which otherwise are replaced during a standard engine 
rebuild. The values, for the individual rebuild parts that are offset 
by the kit parts, are discussed above in conjunction with the 
determination of a weighted rebuild and itemized in Table 6. To 
determine the incremental life cycle cost, these ``offset'' costs are 
subtracted, as shown in Table 8. As shown in the table, the total 
incremental life cycle cost is no more than the ceiling specified in 
the program regulations, $7,940 in 1992 dollars. Engelhard, in its 
letter to EPA dated July 1, 1998, guarantees to make ETX kits available 
to all affected urban bus operators for no more than the maximum 
allowable purchase price. Current values of the maximum purchase prices 
are discussed below.
    vii. Current Maximum Allowable ETX Purchase Price. Table 9 below 
shows the maximum allowable purchase price (in 1992 dollars) as 
determined above. The current (April 1998) maximum allowable purchase 
prices, calculated using a multiplicative ratio of CPI's, are also 
shown in the table. The average CPI for 1992 is 140.3, as specified by 
the program regulation. The April 1998 CPI, for all items and all urban 
consumers, is 162.5. These CPI values are provided by the U.S. 
Department of Labor, Bureau of Labor Statistics.

            Table 9.--Current Maximum ETX Kit Purchase Price            
------------------------------------------------------------------------
                                                            April 1998  
          Applicable model year            1992 maximum       maximum   
                                          purchase price  purchase price
------------------------------------------------------------------------
1988-1990 49-State......................         $11,876         $13,755
1991-1993 50-State......................          10,774          12,479
1988-1990 50-State (California).........          11,768          13,630
------------------------------------------------------------------------

III. California Engines

    The NOx emission standard for new engine certification 
applicable to 1988 through 1990 model year engines sold in the State of 
California is 6.0 g/bhp-hr. For 1991 through 1993, the standard is 5.0 
g/bhp-hr. The emissions testing presented by Engelhard demonstrate a 
NOx emissions level that complies with the 5.0 g/bhp-hr 
standard. Therefore, today's certification of the ETX kit for DDEC II 
engines applies to DDEC II engines certified to meet California 
emissions standards, subject to the conditions discussed below.
    The equipment certified today may require additional review by the 
California Air Resources Board (CARB) before use in the State of 
California. EPA recognizes that special situations may exist in 
California that are reflected in the unique emissions standards, engine 
calibrations, and fuel specifications of the State. While requirements 
of the federal urban bus program apply to several metropolitan areas in 
California, EPA understands the view of CARB that equipment certified 
under the urban bus program, to be used in California, must be provided 
with an executive order exempting it from the anti-tampering 
prohibitions of that State. Parties interested in additional 
information should contact the Aftermarket Part Section of CARB, at 
(818) 575-6848.

IV. Certification and Conditional Certification

    EPA has reviewed this notification, along with comments received 
from interested parties, and finds the equipment described in this 
notification of intent to certify:
    (1) Complies with a particulate matter emissions standard of 0.10 
g/bhp-hr, without causing the applicable engine families to exceed 
other applicable emission requirements, subject to the conditions 
discussed below;
    (2) Will not cause an unreasonable risk to the public health, 
welfare or safety;
    (3) Will not result in any additional range of parameter 
adjustability; and
    (4) Meets other requirements necessary for certification under the 
Urban Bus Rebuild Requirements (40 CFR Sections 85.1401 through 
85.1415).
    With the following conditions, EPA hereby certifies this equipment 
for use in the Urban Bus Retrofit/Rebuild Program. As noted above, the 
equipment being certified today includes, for 1988-1990 model year 
engines, an upgraded control program for the electronic control module. 
EPA has recently become concerned that many electronically controlled 
engines may have been equipped by the original manufacturers with 
strategies designed to decrease fuel consumption during certain driving 
modes not substantially included in the federal test procedure, with 
the effect of substantially increasing NOx during these 
modes. Such electronic control strategies have the potential to be 
``defeat devices'' as defined at 40 CFR 86.094-22, and thus may violate 
40 CFR 85.1406 and 85.1408 if included in an urban bus retrofit 
application. The upgraded control program used for the 1988-1990 model 
year upgrade must therefore be reviewed for such violations.

[[Page 50237]]

    As a result, certification of the ETX kit, as it applies to 1988 
through 1990 model year engines, is conditioned upon Engelhard 
demonstrating by January 1, 1999 that any replacement engine control 
module (ECM) or ECM program used in conjunction with the certified kit 
will not adversely impact the emissions of NOX in comparison 
to the ECM or ECM program that is being replaced under conditions which 
may reasonably be expected to be encountered in normal vehicle 
operation and use unless such conditions are substantially included in 
the Federal emission test procedure. The equipment, the ETX-
2002TM Emissions Rebuild Kit, may be used immediately by 
transit operators in compliance with requirements of this program, 
subject to the above condition.

V. Transit Operator Responsibilities

    Today's Federal Register notice announces certification of the 
above-described Engelhard equipment, when properly applied, as meeting 
the 0.10 g/bhp-hr particulate matter standard of the Urban Bus Rebuild 
Program for urban bus engines certified as meeting both federal and 
California emissions standards. Affected urban bus operators who choose 
to comply with compliance program 1 are required to use this, or other 
equipment that is certified to meet the 0.10 g/bhp-hr particulate 
matter standard, for any engines listed in Table 2 which are rebuilt or 
replaced on or after March 22, 1999, subject to the condition of 
Section IV.
    Urban bus operators who choose to comply with compliance program 2 
may use the certified Engelhard equipment, and those who use this 
equipment may claim the respective particulate matter certification 
level from Table 2 when calculating their Fleet Level Attained (FLA), 
subject to the condition of Section IV.
    Urban bus operators must be aware of their responsibility for 
maintenance of records pursuant to 40 CFR 85.1403 through 85.1404. The 
ETX kit may not include, depending upon model year of the applicable 
engine, fuel injectors, engine camshafts, and blower assembly. As 
stated in the program regulations (40 CFR 85.1401 through 85.1415), 
operators should maintain records for each engine in their fleet to 
demonstrate that they are in compliance with the Urban Bus Rebuild 
Requirements beginning on January 1, 1995. These records include 
purchase records, receipts, and part numbers for the parts and 
components used in the rebuilding of urban bus engines. Urban bus 
operators must be able to demonstrate that all parts used in the 
rebuilding of engines are in compliance with program requirements. In 
other words, urban bus operators must be able to demonstrate that all 
required components of the kit certified in today's Federal Register 
notice are installed on applicable engines.

    Dated: September 11, 1998.
Robert Perciasepe,
Assistant Administrator for Air and Radiation.
[FR Doc. 98-25198 Filed 9-18-98; 8:45 am]
BILLING CODE 6560-50-P