[Federal Register Volume 81, Number 206 (Tuesday, October 25, 2016)]
[Rules and Regulations]
[Pages 73478-74274]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-21203]



[[Page 73477]]

Vol. 81

Tuesday,

No. 206

October 25, 2016

Part II





Environmental Protection Agency





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40 CFR Parts 9, 22, 85, et al.





Department of Transportation





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National Highway Traffic Safety Administration





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49 CFR Parts 523, 534, 535, et al.





Greenhouse Gas Emissions and Fuel Efficiency Standards for Medium- and 
Heavy-Duty Engines and Vehicles--Phase 2; Final Rule

  Federal Register / Vol. 81 , No. 206 / Tuesday, October 25, 2016 / 
Rules and Regulations  

[[Page 73478]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 9, 22, 85, 86, 600, 1033, 1036, 1037, 1039, 1042, 
1043, 1065, 1066, and 1068

DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Parts 523, 534, 535, and 538

[EPA-HQ-OAR-2014-0827; NHTSA-2014-0132; FRL-9950-25-OAR]
RIN 2060-AS16; RIN 2127-AL52


Greenhouse Gas Emissions and Fuel Efficiency Standards for 
Medium- and Heavy-Duty Engines and Vehicles--Phase 2

AGENCY: Environmental Protection Agency (EPA) and National Highway 
Traffic Safety Administration (NHTSA), Department of Transportation 
(DOT).

ACTION: Final rule.

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SUMMARY: EPA and NHTSA, on behalf of the Department of Transportation, 
are establishing rules for a comprehensive Phase 2 Heavy-Duty (HD) 
National Program that will reduce greenhouse gas (GHG) emissions and 
fuel consumption from new on-road medium- and heavy-duty vehicles and 
engines. NHTSA's fuel consumption standards and EPA's carbon dioxide 
(CO2) emission standards are tailored to each of four 
regulatory categories of heavy-duty vehicles: Combination tractors; 
trailers used in combination with those tractors; heavy-duty pickup 
trucks and vans; and vocational vehicles. The rule also includes 
separate standards for the engines that power combination tractors and 
vocational vehicles. Certain requirements for control of GHG emissions 
are exclusive to the EPA program. These include EPA's hydrofluorocarbon 
standards to control leakage from air conditioning systems in 
vocational vehicles and EPA's nitrous oxide (N2O) and 
methane (CH4) standards for heavy-duty engines. 
Additionally, NHTSA is addressing misalignment between the Phase 1 EPA 
GHG standards and the NHTSA fuel efficiency standards to virtually 
eliminate the differences. This action also includes certain EPA-
specific provisions relating to control of emissions of pollutants 
other than GHGs. EPA is finalizing non-GHG emission standards relating 
to the use of diesel auxiliary power units installed in new tractors. 
In addition, EPA is clarifying the classification of natural gas 
engines and other gaseous-fueled heavy-duty engines. EPA is also 
finalizing technical amendments to EPA rules that apply to emissions of 
non-GHG pollutants from light-duty motor vehicles, marine diesel 
engines, and other nonroad engines and equipment. Finally, EPA is 
requiring that engines from donor vehicles installed in new glider 
vehicles meet the emission standards applicable in the year of assembly 
of the new glider vehicle, including all applicable standards for 
criteria pollutants, with limited exceptions for small businesses and 
for other special circumstances.

DATES: This final rule is effective on December 27, 2016. The 
incorporation by reference of certain publications listed in this 
regulation is approved by the Director of the Federal Register as of 
December 27, 2016.

ADDRESSES: EPA and NHTSA have established dockets for this action under 
Docket ID No. EPA-HQ-OAR-2014-0827 (for EPA's docket) and NHTSA-2014-
0132 (for NHTSA's docket). All documents in the docket are listed on 
the https://www.regulations.gov Web site. Although listed in the index, 
some information is not publicly available, e.g., CBI or other 
information whose disclosure is restricted by statute. Certain other 
material, such as copyrighted material, is not placed on the Internet 
and will be publicly available only in hard copy form. Publicly 
available docket materials are available either electronically in 
https://www.regulations.gov or in hard copy at the following locations:
    EPA: Air and Radiation Docket and Information Center, EPA Docket 
Center, EPA/DC, EPA WJC West Building, 1301 Constitution Ave. NW., Room 
3334, Washington, DC. The Public Reading Room is open from 8:30 a.m. to 
4:30 p.m., Monday through Friday, excluding legal holidays. The 
telephone number for the Public Reading Room is (202) 566-1744, and the 
telephone number for the Air Docket is (202) 566-1742.
    NHTSA: Docket Management Facility, M-30, U.S. Department of 
Transportation, West Building, Ground Floor, Rm. W12-140, 1200 New 
Jersey Avenue SE., Washington, DC 20590. The telephone number for the 
docket management facility is (202) 366-9324. The docket management 
facility is open between 9 a.m. and 5 p.m. Eastern Time, Monday through 
Friday, except Federal Holidays.

FOR FURTHER INFORMATION CONTACT: 
    EPA: Tad Wysor, Office of Transportation and Air Quality, 
Assessment and Standards Division (ASD), Environmental Protection 
Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105; telephone number: 
(734) 214-4332; email address: [email protected].
    NHTSA: Ryan Hagen, Office of Chief Counsel, National Highway 
Traffic Safety Administration, 1200 New Jersey Avenue SE., Washington, 
DC 20590. Telephone: (202) 366-2992; [email protected].

SUPPLEMENTARY INFORMATION:

A. Does this action apply to me?

    This action will affect companies that manufacture, sell, or import 
into the United States new heavy-duty engines and new Class 2b through 
8 trucks, including combination tractors, all types of buses, 
vocational vehicles including municipal, commercial, recreational 
vehicles, and commercial trailers as well as \3/4\-ton and 1-ton pickup 
trucks and vans. The heavy-duty category incorporates all motor 
vehicles with a gross vehicle weight rating of 8,500 lbs. or greater, 
and the engines that power them, except for medium-duty passenger 
vehicles already covered by the greenhouse gas standards and corporate 
average fuel economy standards issued for light-duty model year 2017-
2025 vehicles.\1\ Regulated categories and entities include the 
following:
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    \1\ As discussed in Section I.A, the term heavy-duty is 
generally used in this rulemaking to refer to all vehicles with a 
gross vehicle weight rating above 8,500 lbs, including vehicles that 
are sometimes otherwise known as medium-duty vehicles.

------------------------------------------------------------------------
                                               Examples of potentially
          Category           NAICS code \a\       affected entities
------------------------------------------------------------------------
Industry...................          336111  Motor Vehicle
                                              Manufacturers, Engine
                                              Manufacturers, Truck
                                              Manufacturers, Truck
                                              Trailer Manufacturers.
                                     336112
                                     333618
                                     336120
                                     336212
Industry...................          541514  Commercial Importers of
                                              Vehicles and Vehicle
                                              Components.
                                     811112

[[Page 73479]]

 
                                     811198
Industry...................          336111  Alternative Fuel Vehicle
                                              Converters.
                                     336112
                                     422720
                                     454312
                                     541514
                                     541690
                                     811198
------------------------------------------------------------------------
Note:
\a\ North American Industry Classification System (NAICS).

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely covered by these rules. 
This table lists the types of entities that the agencies are aware may 
be regulated by this action. Other types of entities not listed in the 
table could also be regulated. To determine whether your activities are 
regulated by this action, you should carefully examine the 
applicability criteria in the referenced regulations. You may direct 
questions regarding the applicability of this action to the persons 
listed in the preceding FOR FURTHER INFORMATION CONTACT section.

B. Did EPA conduct a peer review before issuing this document?

    This regulatory action is supported by influential scientific 
information. Therefore, EPA conducted a peer review consistent with 
OMB's Final Information Quality Bulletin for Peer Review. As described 
in Section II.C, a peer review of updates to the vehicle simulation 
model (GEM) for the Phase 2 standards has been completed. This version 
of GEM is based on the model used for the Phase 1 rule, which was peer 
reviewed by a panel of four independent subject matter experts. The 
peer review report and EPA's response to the peer review comments are 
available in Docket ID No. EPA-HQ-OAR-2014-0827. We note that this 
rulemaking is based on a vast body of existing peer-reviewed work, 
i.e., work that was peer-reviewed outside of this action, as noted in 
the references throughout this Preamble, the Regulatory Impacts 
Analysis, and the rulemaking docket. EPA also notified the SAB of its 
plans for this rulemaking and on June 11, 2014, the chartered SAB 
discussed the recommendations of its work group on the planned action 
and agreed that no further SAB consideration of the supporting science 
was merited.

C. Executive Summary

(1) Commitment to Greenhouse Gas Emission Reductions and Vehicle Fuel 
Efficiency

    In June 2013, the President announced a comprehensive Climate 
Action Plan for the United States to reduce carbon pollution, prepare 
for the impacts of climate change, and lead international efforts to 
address global climate change.\2\ In this plan, President Obama 
reaffirmed his commitment to reduce U.S. greenhouse gas emissions in 
the range of 17 percent below 2005 levels by 2020. More recently, in 
December 2015, the U.S. was one of over 190 signatories to the Paris 
Climate Agreement, widely regarded as the most ambitious climate change 
agreement in history. The Paris agreement reaffirms the goal of 
limiting global temperature increase to well below 2 degrees Celsius, 
and for the first time urged efforts to limit the temperature increase 
to 1.5 degrees Celsius. The U.S. submitted a non-binding intended 
nationally determined contribution (NDC) target of reducing economy-
wide GHG emissions by 26-28 percent below its 2005 level in 2025 and to 
make best efforts to reduce emissions by 28 percent.\3\ This pace would 
keep the U.S. on a trajectory to achieve deep economy-wide reductions 
on the order of 80 percent by 2050.
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    \2\ The White House, The President's Climate Action Plan (June, 
2013). http://www.whitehouse.gov/share/climate-action-plan.
    \3\ United States of America, Intended Nationally Determined 
Contribution, March 31, 2015, http://www4.unfccc.int/submissions/INDC/Published%20Documents/United%20States%20of%20America/1/U.S.%20Cover%20Note%20INDC%20and%20Accompanying%20Information.pdf.
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    As part of his Climate Action plan, the President specifically 
directed the Environmental Protection Agency (EPA) and the Department 
of Transportation's (DOT) National Highway Traffic Safety 
Administration (NHTSA) to set the next round of standards to reduce 
greenhouse gas (GHG) emissions and improve fuel efficiency for heavy-
duty vehicles pursuant to and consistent with the agencies' existing 
statutory authorities.\4\ More than 70 percent of the oil used in the 
United States and 26 percent of GHG emissions come from the 
transportation sector, and since 2009 EPA and NHTSA have worked with 
industry, states, and other stakeholders to develop ambitious, flexible 
standards for both the fuel economy and GHG emissions of light-duty 
vehicles and the fuel efficiency and GHG emissions of heavy-duty 
vehicles.5 6 The standards here (referred to as Phase 2) 
will build on the light-duty vehicle standards spanning model years 
2012 to 2025 and on the initial phase of standards (referred to as 
Phase 1) for new medium and heavy-duty vehicles (MDVs and HDVs) and 
engines in model years 2014 to 2018. Throughout every stage of 
development for these programs, EPA and NHTSA (collectively, the 
agencies, or ``we'') have worked in close partnership not only with one 
another, but also with the vehicle manufacturing industry, 
environmental community leaders, and the State of California among 
other entities to create a single, effective set of national standards.
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    \4\ EPA's HD Phase 2 GHG emission standards are authorized under 
the Clean Air Act, and NHTSA's HD Phase 2 fuel consumption standards 
are authorized under the Energy Independence and Security Act of 
2007.
    \5\ The White House, Improving the Fuel Efficiency of American 
Trucks--Bolstering Energy Security, Cutting Carbon Pollution, Saving 
Money and Supporting Manufacturing Innovation (Feb. 2014), 2.
    \6\ U.S. Environmental Protection Agency. April 2016. Inventory 
of U.S. Greenhouse Gas Emissions and Sinks: 1990-2012. EPA 430-R-16-
002. Mobile sources emitted 28 percent of all U.S. GHG emissions in 
2012. Available at  https://www3.epa.gov/climatechange/Downloads/ghgemissions/US-GHG-Inventory-2016-Main-Text.pdf.
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    Through two previous rulemakings, EPA and NHTSA have worked with 
the auto industry to develop new fuel economy and GHG emission 
standards for light-duty vehicles. Taken together with NHTSA's 2011 
CAFE standards, the light-duty vehicle standards span model years 2011 
to 2025 and are the first significant improvement in fuel economy in 
approximately two decades. Under the final program, average new car and 
light truck fuel economy is expected to nearly double by 2025

[[Page 73480]]

compared to 2010 vehicles.\7\ In the 2012 rule, the agencies projected 
the standards would save consumers $1.7 trillion at the pump--roughly 
$8,200 per vehicle for a MY 2025 vehicle--reducing oil consumption by 
2.2 million barrels a day in 2025 and slashing GHG emissions by 6 
billion metric tons over the lifetime of the vehicles sold during this 
period.\8\ These fuel economy standards are already delivering savings 
for American drivers. Between model years 2008 and 2013, the unadjusted 
average test fuel economy of new passenger cars and light trucks sold 
in the United States has increased by about four miles per gallon. 
Altogether, light-duty vehicle fuel economy standards finalized after 
2008 have already saved nearly one billion gallons of fuel and avoided 
more than 10 million tons of carbon dioxide emissions.\9\
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    \7\ The White House, Improving the Fuel Efficiency of American 
Trucks--Bolstering Energy Security, Cutting Carbon Pollution, Saving 
Money and Supporting Manufacturing Innovation (Feb. 2014), 2.
    \8\ Id.
    \9\ Id. at 3.
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    Similarly, EPA and NHTSA have previously developed joint GHG 
emission and fuel efficiency standards for MDVs and HDVs. Prior to 
these Phase 1 standards, heavy-duty trucks and buses--from delivery 
vans to the largest tractor-trailers--were required to meet pollution 
standards for soot and smog-causing air pollutants, but no requirements 
existed for the fuel efficiency or carbon pollution from these 
vehicles.\10\ By 2010, total fuel consumption and GHG emissions from 
MDVs and HDVs had been growing, and these vehicles accounted for 23 
percent of total U.S. transportation-related GHG emissions \11\ and 
about 20 percent of U.S. transportation-related energy use. In August 
2011, the agencies finalized the groundbreaking Phase 1 standards for 
new MDVs and HDVs in model years 2014 through 2018. This program, 
developed with support from the trucking and engine industries, the 
State of California, Environment and Climate Change Canada, and leaders 
from the environmental community, set standards based on the use of 
off-the-shelf technologies. These standards are expected to save a 
projected 530 million barrels of oil and reduce carbon emissions by 
about 270 million metric tons, representing one of the most significant 
programs available to reduce domestic fuel consumption and emissions of 
GHGs.\12\ The Phase 1 program, as well as the many additional actions 
called for in the President's 2013 Climate Action Plan \13\ including 
this Phase 2 rulemaking, not only result in meaningful decreases in GHG 
emissions and fuel consumption, but also support--indeed are critical 
for--United States leadership to encourage other countries to also 
achieve meaningful GHG reductions and fuel conservation.
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    \10\ Id.
    \11\ Id.
    \12\ Id. at 4.
    \13\ The President's Climate Action Plan calls for GHG-cutting 
actions including, for example, reducing carbon emissions from power 
plants and curbing hydrofluorocarbon and methane emissions.
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    This rule builds on our commitment to robust collaboration with 
stakeholders and the public. It follows an expansive and thorough 
outreach effort in which the agencies gathered input, data and views 
from many interested stakeholders, involving over 400 meetings with 
heavy-duty vehicle and engine manufacturers, technology suppliers, 
trucking fleets, truck drivers, dealerships, environmental 
organizations, and state agencies.\14\ As with the previous light-duty 
rules and the heavy-duty Phase 1 rule, the agencies have consulted 
frequently with the California Air Resources Board (CARB) staff during 
the development of this rule, given California's unique ability among 
the states to adopt their own GHG standards for on-highway engines and 
vehicles. Through this close coordination, the agencies are finalizing 
a Phase 2 program that will be fully aligned between EPA and NHTSA, 
while providing CARB with the opportunity to adopt a Phase 2 program 
that will allow manufacturers to continue to build a single fleet of 
vehicles and engines.
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    \14\ ``Heavy-Duty Phase 2 Stakeholder Meeting Log'', August 
2016.
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(2) Overview of Phase 1 Medium- and Heavy-Duty Vehicle Standards

    The Phase 1 program covers new trucks and heavy vehicles in model 
years 2014 and later. That program includes specific standards for 
combination tractors, heavy-duty pickup trucks and vans, and vocational 
vehicles and includes separate standards for both vehicles and engines. 
The program offers extensive flexibility, allowing manufacturers to 
reach standards through average fleet calculations, a mix of 
technologies, and the use of various credit and banking programs.
    The Phase 1 program was developed by the agencies through close 
consultation with industry and other stakeholders, resulting in 
standards tailored to the specifics of each different class of vehicles 
and engines.
     Heavy-duty combination tractors. Combination tractors--
semi trucks that typically pull trailers--are regulated under nine 
subcategories based on weight class, cab type, and roof height. These 
vehicles represent approximately 60 percent of the fuel consumption and 
GHG emissions from MDVs and HDVs.
     Heavy-duty pickup trucks and vans. Heavy-duty pickup and 
van standards are based on a ``work factor'' attribute that combines a 
vehicle's payload, towing capabilities, and the presence of 4-wheel 
drive. These vehicles represent about 23 percent of the fuel 
consumption and GHG emissions from MDVs and HDVs.
     Vocational vehicles. Specialized vocational vehicles, 
which consist of a very wide variety of truck and bus types (e.g., 
delivery, refuse, utility, dump, cement, transit bus, shuttle bus, 
school bus, emergency vehicles, and recreational vehicles) are 
regulated in three subcategories based on engine classification. These 
vehicles represent approximately 17 percent of the fuel consumption and 
GHG emissions from MDVs and HDVs. The Phase 1 program includes EPA GHG 
standards for recreational vehicles, but not NHTSA fuel efficiency 
standards.\15\
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    \15\ The Phase 2 program will also include NHTSA recreational 
vehicle fuel efficiency standards.
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     Heavy-duty engines. The Phase 1 rule has independent 
standards for heavy-duty engines to assure they contribute to reducing 
GHG emissions and fuel consumption because the Phase 1 tractor and 
vocational vehicle standards do not account for the contributions of 
engine improvements to reducing fuel consumption and GHG emissions.
    The Phase 1 standards were premised on utilization of technologies 
that were already in production on some vehicles at the time of the 
Phase 1 FRM and are adaptable to the broader fleet. The Phase 1 program 
provides flexibilities that facilitate compliance. These flexibilities 
help provide sufficient lead time for manufacturers to make necessary 
technological improvements and reduce the overall cost of the program, 
without compromising overall environmental and fuel consumption 
objectives. The primary flexibility provisions are an engine averaging, 
banking, and trading (ABT) program and a vehicle ABT program. These ABT 
programs allow for emission and/or fuel consumption credits to be 
averaged, banked, or traded within each of the averaging sets.
    The Phase 1 program was projected to save 530 million barrels of 
oil and avoid 270 million metric tons of GHG emissions.\16\ At the same 
time, the

[[Page 73481]]

program was projected to produce $50 billion in fuel savings and $49 
billion of net societal benefits. Today, the Phase 1 fuel efficiency 
and GHG reduction standards are already reducing GHG emissions and U.S. 
oil consumption, and producing fuel savings for America's trucking 
industry. The market appears to be very accepting of the Phase 1 
technologies.
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    \16\ The White House, Improving the Fuel Efficiency of American 
Trucks--Bolstering Energy Security, Cutting Carbon Pollution, Saving 
Money and Supporting Manufacturing Innovation (Feb. 2014), 4.
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(3) Overview of Phase 2 Medium- and Heavy-Duty Vehicle Standards

    The Phase 2 GHG and fuel efficiency standards for MDVs and HDVs are 
a critical next step in improving fuel efficiency and reducing GHG 
emissions. The Phase 2 national program carries forward our commitment 
to meaningful collaboration with stakeholders and the public, as they 
build on more than 400 meetings with manufacturers, suppliers, trucking 
fleets, dealerships, state air quality agencies, non-governmental 
organizations (NGOs), and other stakeholders; over 200,000 public 
comments; and two public hearings to identify and understand the 
opportunities and challenges involved with this next level of fuel-
saving technology. These meetings and public feedback, in addition to 
close coordination with CARB, have been invaluable to the agencies, 
enabling the development of a program that appropriately balances all 
potential impacts, effectively minimizes the possibility of unintended 
consequences, and allows manufacturers to continue to build a single 
fleet of vehicles and engines.
    Phase 2 will include technology-advancing standards that will phase 
in over the long-term (through model year 2027) to result in an 
ambitious, yet achievable program that will allow manufacturers to meet 
standards through a mix of different technologies at reasonable cost. 
The terminal requirements go into effect in 2027, and would apply to MY 
2027 and subsequent model year vehicles, unless modified by future 
rulemaking. The Phase 2 standards will maintain the underlying 
regulatory structure developed in the Phase 1 program, such as the 
general categorization of MDVs and HDVs and the separate standards for 
vehicles and engines. However, the Phase 2 program will build on and 
advance Phase 1 in a number of important ways including the following: 
basing standards not only on currently available technologies but also 
on utilization of technologies now under development or not yet widely 
deployed while providing significant lead time to assure adequate time 
to develop, test, and phase in these controls; developing first-time 
GHG and fuel efficiency standards for trailers; further encouraging 
innovation and providing flexibility; including vehicles produced by 
small business manufacturers with appropriate flexibilities for these 
companies; incorporating enhanced test procedures that (among other 
things) allow individual drivetrain and powertrain performance to be 
reflected in the vehicle certification process; and using an expanded 
and improved compliance simulation model.
    The Phase 2 program will provide significant GHG reductions and 
save fuel by:
     Strengthening standards to account for ongoing 
technological advancements. Relative to the baseline as of the end of 
Phase 1, these final standards are projected to achieve vehicle fuel 
savings as high as 25 percent, depending on the vehicle category. While 
costs are higher than for Phase 1, benefits greatly exceed costs, and 
payback periods are short, meaning that consumers will see substantial 
net savings over the vehicle lifetime. Payback is estimated at about 
two years for tractors and trailers, about four years for vocational 
vehicles, and about three years for heavy-duty pickups and vans. The 
agencies are finalizing a program that phases in the MY 2027 standards 
with interim standards for model years 2021 and 2024 (and for certain 
types of trailers, EPA is finalizing model year 2018 phase-in standards 
as well). The final program includes both significant strengthening of 
certain standards from the NPRM as well as adjustments to better align 
other standards with new data, analysis, and stakeholder and public 
feedback received since the time of the proposal.
     Setting standards for trailers for the first time. In 
addition to retaining the vehicle and engine categories covered in the 
Phase 1 program, the Phase 2 standards include fuel efficiency and GHG 
emission standards for trailers used in combination with tractors. 
Although the agencies are not finalizing standards for all trailer 
types, the majority of new trailers will be covered.
     Encouraging technological innovation while providing 
flexibility and options for manufacturers. For each category of HDVs, 
the standards will set performance targets that allow manufacturers to 
achieve reductions through a mix of different technologies and 
generally leave manufacturers free to choose any means of compliance. 
For tractor standards, for example, different combinations of 
improvements like advanced aerodynamics, engine improvements and waste-
heat recovery, automated transmission, lower rolling resistance tires, 
and automatic tire inflation can be used to meet standards. For 
tractors and vocational vehicles, enhanced test procedures and an 
expanded and improved compliance simulation model enable the vehicle 
standards to encompass more of the complete vehicle than the Phase 1 
program and to account for engine, transmission and driveline 
improvements. With the addition of the powertrain and driveline to the 
compliance model, representative drive cycles and vehicle baseline 
configurations become critically important to assure the standards 
promote technologies that improve real world fuel efficiency and GHG 
emissions. This rule updates drive cycles and vehicle configurations to 
better reflect real world operation. The final program includes 
adjustments to technical elements of the proposed compliance program, 
e.g., test procedures, reflecting the significant amount of stakeholder 
and public comment the agencies received on the program. Additionally, 
the agencies' analyses indicate that this rule should have no adverse 
impact on vehicle or engine safety.
     Providing flexibilities to help minimize effect on small 
businesses. All small businesses are exempt from the Phase 1 standards. 
The agencies are regulating small business entities under Phase 2 
(notably certain trailer manufacturers), but we have conducted 
extensive proceedings pursuant to section 609 of the Regulatory 
Flexibility Act, and engaged in extensive consultation with 
stakeholders, and developed an approach to provide targeted 
flexibilities geared toward helping small businesses comply with the 
Phase 2 standards. Specifically, the agencies are delaying the initial 
implementation of the Phase 2 standards by one year and simplifying 
certification requirements for small businesses. We are also adopting 
additional flexibilities and exemptions adapted to particular vehicle 
categories.
    The following tables summarize the impacts of the Heavy-Duty Phase 
2 rule.

[[Page 73482]]



  Summary of the Phase 2 Medium- and Heavy-Duty Vehicle Rule Impacts to
Fuel Consumption, GHG Emissions, Benefits and Costs Over the Lifetime of
                      Model Years 2018-2029 \a\ \b\
------------------------------------------------------------------------
                                                3%              7%
------------------------------------------------------------------------
Fuel Reductions (billion gallons).......               71-82
                                         -------------------------------
GHG Reductions (MMT, CO[ihel2]eq).......             959-1098
                                         -------------------------------
Pre-Tax Fuel Savings ($billion).........         149-169           80-87
Discounted Technology Costs ($billion)..           24-27           16-18
Value of reduced emissions ($billion)...           60-69           48-52
Total Costs ($billion)..................           29-31           19-20
Total Benefits ($billion)...............         225-260         136-151
Net Benefits ($billion).................         197-229         117-131
------------------------------------------------------------------------
Notes:
\a\ Ranges reflect two analysis methods: Method A with the 1b baseline
  and Method B with the la baseline. For an explanation of analytical
  Methods A and B, please see Section I.D; for an explanation of the
  ``flat'' baseline, 1a, and the ``dynamic'' baseline, 1b, please see
  Section X.A.1.
\b\ Benefits and net benefits (including those in the 7% discount rate
  column) use the 3 percent average Social Cost of CO[ihel2], the Social
  Cost of CH[ihel4], and the Social Cost of N[ihel2]O.


  Summary of the Phase 2 Medium- and Heavy-Duty Vehicle Annual Fuel and
  GHG Reductions, Program Costs, Benefits and Net Benefits in Calendar
                         Years 2040 and 2050 \a\
------------------------------------------------------------------------
                                               2040            2050
------------------------------------------------------------------------
Fuel Reductions (Billion Gallons).......            10.8            13.0
GHG Reduction (MMT, CO[ihel2]eq)........           166.8           199.3
Vehicle Program Costs (including                   -$6.5           -$7.5
 Maintenance; Billions of 2013$)........
Fuel Savings (Pre-Tax; Billions of                 $53.1           $63.4
 2013$).................................
Benefits (Billions of 2013$)............           $24.8           $31.7
Net Benefits (Billions of 2013$)........           $71.4           $87.6
------------------------------------------------------------------------
Note:
\a\ Benefits and net benefits (including those in the 7% discount rate
  column) use the 3 percent average Social Cost of CO[ihel2], the Social
  Cost of CH[ihel4], and the Social Cost of N[ihel2]O. Values reflect
  the final program using Method B relative to the flat baseline (a
  reference case that projects very little improvement in new vehicle
  fuel economy absent new standards).


  Summary of the Phase 2 Medium- and Heavy-Duty Vehicle Program Expected Per-Vehicle Fuel Savings, GHG Emission
                                 Reductions, and Cost for Key Vehicle Categories
----------------------------------------------------------------------------------------------------------------
                                                              MY 2021            MY 2024            MY 2027
----------------------------------------------------------------------------------------------------------------
Maximum Vehicle Fuel Savings and Tailpipe GHG Reduction
 (%):
    Tractors \b\.......................................                 13                 20                 25
    Trailers \a\.......................................                  5                  7                  9
    Vocational Vehicles \b\............................                 12                 20                 24
    Pickups/Vans.......................................                2.5                 10                 16
Per Vehicle Cost ($)\c\ \d\ (% Increase in Typical
 Vehicle Price):
    Tractors...........................................      $6,400-$6,480     $9,920-$10,100    $12,160-$12,440
                                                                      (6%)              (10%)              (12%)
    Trailers...........................................          $850-$870      $1,000-$1,030      $1,070-$1,110
                                                                      (3%)               (4%)               (4%)
    Vocational Vehicles................................      $1,110-$1,160      $1,980-$2,020      $2,660-$2,700
                                                                      (1%)               (2%)               (3%)
    Pickups/Vans.......................................          $520-$750          $760-$960      $1,340-$1,360
                                                                      (1%)               (2%)               (3%)
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Note that the EPA standards for trailers begin in model year 2018
\b\ All engine costs are included
\c\ Please refer to Preamble Chapters 6 and 10 for additional information on the reference fleet used to analyze
  costs and benefits of the rule. Please also refer to these chapters for impacts of the rule under more dynamic
  baseline assumptions for pickups and vans.
\d\ Ranges reflect two analysis methods: Method A with the 1b baseline and Method B with the la baseline. For an
  explanation of analytical Methods A and B, please see Section I.D; for an explanation of the ``flat''
  baseline, 1a, and the ``dynamic'' baseline, 1b, please see Section X.A.1.
\e\ For this table, we use an approximate minimum vehicle price today of $100,000 for tractors, $25,000 for
  trailers, $100,000 for vocational vehicles and $40,000 for HD pickups/vans.


[[Page 73483]]


Payback Periods for MY 2027 Vehicles Under the Final Standards, Based on
                      both Analysis Methods A and B
        [Payback occurs in the year shown; using 7% discounting]
------------------------------------------------------------------------
                                                   Final standards
------------------------------------------------------------------------
Tractors/Trailers..........................  2nd.
Vocational Vehicles........................  4th.
Pickups/Vans \a\...........................  3rd.
------------------------------------------------------------------------
Note:
\a\ Please refer to Preamble Chapters 6 and 10 for additional
  information on the reference fleet used to analyze costs and benefits
  of the rule. Please also refer to these chapters for impacts of the
  rule under more dynamic baseline assumptions for pickups and vans.

(4) Issues Addressed in This Final Rule

    This Preamble contains extensive discussion of the background, 
elements, and implications of the Phase 2 program, as well as updates 
made to the final program from the proposal based on new data, 
analysis, stakeholder feedback and public comments. Section I includes 
information on the MDV and HDV industry, related regulatory and non-
regulatory programs, summaries of Phase 1 and Phase 2 programs, costs 
and benefits of the final standards, and relevant statutory authority 
for EPA and NHTSA. Section II discusses vehicle simulation, engine 
standards, and test procedures. Sections III, IV, V, and VI detail the 
final standards for combination tractors, trailers, vocational 
vehicles, and heavy-duty pickup trucks and vans. Sections VII and VIII 
discuss aggregate GHG impacts, fuel consumption impacts, climate 
impacts, and impacts on non-GHG emissions. Section IX evaluates the 
economic impacts of the final program. Sections X and XI present the 
alternatives analyses and consideration of natural gas vehicles. 
Finally, Sections XII and XIII discuss the changes that the Phase 2 
rules will have on Phase 1 standards and other regulatory provisions. 
In addition to this Preamble, the Regulatory Impact Analysis (RIA),\17\ 
provides additional data, analysis and discussion of the standards, and 
the Response to Comments Document for Joint Rulemaking (RTC) provides 
responses to comments received on the Phase 2 rulemaking through the 
public comment process.\18\
---------------------------------------------------------------------------

    \17\ Available on EPA and NHTSA's Web sites and in the public 
docket for this rulemaking.
    \18\ Available on EPA's Web site and in the public docket for 
this rulemaking.
---------------------------------------------------------------------------

Table of Contents

    A. Does this action apply to me?
    B. Did EPA conduct a peer review before issuing this document?
    C. Executive Summary
I. Overview
    A. Background
    B. Summary of Phase 1 Program
    C. Summary of the Phase 2 Standards and Requirements
    D. Summary of the Costs and Benefits of the Final Rules
    E. EPA and NHTSA Statutory Authorities
    F. Other Issues
II. Vehicle Simulation and Separate Engine Standards for Tractors 
and Vocational Chassis
    A. Introduction
    B. Phase 2 Regulatory Structure
    C. Phase 2 GEM and Vehicle Component Test Procedures
    D. Engine Test Procedures and Engine Standards
III. Class 7 and 8 Combination Tractors
    A. Summary of the Phase 1 Tractor Program
    B. Overview of the Phase 2 Tractor Program and Key Changes From 
the Proposal
    C. Phase 2 Tractor Standards
    D. Feasibility of the Final Phase 2 Tractor Standards
    E. Phase 2 Compliance Provisions for Tractors
    F. Flexibility Provisions
IV. Trailers
    A. The Trailer Industry
    B. Overview of the Phase 2 Trailer Program and Key Changes From 
the Proposal
    C. Phase 2 Trailer Standards
    D. Feasibility of the Trailer Standards
    E. Trailer Standards: Compliance and Flexibilities
V. Class 2b-8 Vocational Vehicles
    A. Summary of Phase 1 Vocational Vehicle Standards
    B. Phase 2 Standards for Vocational Vehicles
    C. Feasibility of the Vocational Vehicle Standards
    D. Compliance Provisions for Vocational Vehicles
VI. Heavy-Duty Pickups and Vans
    A. Summary of Phase 1 HD Pickup and Van Standards
    B. HD Pickup and Van Final Phase 2 Standards
    C. Use of the CAFE Model in Heavy-Duty Rulemaking
    D. NHTSA CAFE Model Analysis of the Regulatory Alternatives for 
HD Pickups and Vans: Method A
    E. Analysis of the Regulatory Alternatives for HD Pickups and 
Vans: Method B
    F. Compliance and Flexibility for HD Pickup and Van Standards
VII. Aggregate GHG, Fuel Consumption, and Climate Impacts
    A. What methodologies did the agencies use to project GHG 
emissions and fuel consumption impacts?
    B. Analysis of Fuel Consumption and GHG Emissions Impacts 
Resulting From Final Standards
    C. What are the projected reductions in fuel consumption and GHG 
emissions?
    D. Climate Impacts and Indicators
VIII. How will these rules impact non-GHG emissions and their 
associated effects?
    A. Health Effects of Non-GHG Pollutants
    B. Environmental Effects of Non-GHG Pollutants
    C. Emissions Inventory Impacts
    D. Air Quality Impacts of Non-GHG Pollutants
IX. Economic and Other Impacts
    A. Conceptual Framework
    B. Vehicle-Related Costs Associated With the Program
    C. Changes in Fuel Consumption and Expenditures
    D. Maintenance Expenditures
    E. Analysis of the Rebound Effect
    F. Impact on Class Shifting, Fleet Turnover, and Sales
    G. Monetized GHG Impacts
    H. Monetized Non-GHG Health Impacts
    I. Energy Security Impacts
    J. Other Impacts
    K. Summary of Benefits and Costs
    L. Employment Impacts
    M. Cost of Ownership and Payback Analysis
    N. Safety Impacts
X. Analysis of the Alternatives
    A. What are the alternatives that the agencies considered?
    B. How do these alternatives compare in overall fuel consumption 
and GHG emissions reductions?
XI. Natural Gas Vehicles and Engines
    A. Natural Gas Engine and Vehicle Technology
    B. GHG Lifecycle Analysis for Natural Gas Vehicles
    C. Projected Use of LNG and CNG
    D. Natural Gas Emission Control Measures
    E. Dimethyl Ether
XII. Amendments to Phase 1 Standards
    A. EPA Amendments
    B. Other Compliance Provisions for NHTSA
XIII. Other Regulatory Provisions
    A. Amendments Related to Heavy-Duty Highway Engines and Vehicles
    B. Amendments Affecting Glider Vehicles and Glider Kits
    C. Applying the General Compliance Provisions of 40 CFR Part 
1068 to Light-Duty Vehicles, Light-Duty Trucks, Chassis-Certified 
Class 2b and 3 Heavy-Duty Vehicles and Highway Motorcycles
    D. Amendments to General Compliance Provisions in 40 CFR Part 
1068
    E. Amendments to Light-Duty Greenhouse Gas Program Requirements
    F. Amendments to Highway and Nonroad Test Procedures and 
Certification Requirements
    G. Amendments Related to Locomotives in 40 CFR Part 1033
    H. Amendments Related to Nonroad Diesel Engines in 40 CFR Part 
1039
    I. Amendments Related to Marine Diesel Engines in 40 CFR Parts 
1042 and 1043
    J. Miscellaneous EPA Amendments
    K. Competition Vehicles
    L. Amending 49 CFR Parts 512 and 537 To Allow Electronic 
Submissions and Defining Data Formats for Light-Duty Vehicle 
Corporate Average Fuel Economy (CAFE) Reports
XIV. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive

[[Page 73484]]

Order 13563: Improving Regulation and Regulatory Review
    B. National Environmental Policy Act
    C. Paperwork Reduction Act
    D. Regulatory Flexibility Act
    E. Unfunded Mandates Reform Act
    F. Executive Order 13132: Federalism
    G. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    H. Executive Order 13045: Protection of Children From 
Environmental Health Risks and Safety Risks
    I. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use
    J. National Technology Transfer and Advancement Act and 1 CFR 
Part 51
    K. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    L. Endangered Species Act (ESA)
    M. Congressional Review Act (CRA)
XV. EPA and NHTSA Statutory Authorities
    A. EPA
    B. NHTSA
List of Subjects

I. Overview

    The agencies issued a Notice of Proposed Rulemaking (NPRM) on July 
13, 2015, that proposed Phase 2 GHG and fuel efficiency standards for 
heavy-duty engines and vehicles.\19\ The agencies also issued a Notice 
of Data Availability (NODA) on March 2, 2016, to solicit comment on new 
material not available at the time of the NPRM.\20\ The agencies have 
revised the proposed standards and related requirements to address 
issues raised in public comments. Nevertheless, the final rules being 
adopted today remain fundamentally similar to the proposed rules.
---------------------------------------------------------------------------

    \19\ 80 FR 40137.
    \20\ 81 FR 10824.
---------------------------------------------------------------------------

    Although the agencies describe the final requirements in this 
document, readers are encouraged to also read supporting materials that 
have been place into the public dockets for these rules. In particular, 
the agencies note:

 The Final Regulatory Impact Analysis (RIA), provides 
additional technical information and analysis
 The Response to Comments Document for Joint Rulemaking (RTC), 
provides a detailed summary and analysis of public comments, including 
comments received in response to the NODA
 The NHTSA Final Environmental Impact Statement (FEIS)

    This overview of the final Phase 2 GHG emissions and fuel 
efficiency standards includes a description of the heavy-duty truck 
industry and related regulatory and non-regulatory programs, a summary 
of the Phase 1 GHG emissions and fuel efficiency program, a summary of 
the Phase 2 standards and requirements being finalized, a summary of 
the costs and benefits of the Phase 2 standards, discussion of EPA and 
NHTSA statutory authorities, and other issues.

A. Background

    For purposes of this Preamble (and consistent with all terminology 
used at proposal), the terms ``heavy-duty'' or ``HD'' are used to apply 
to all highway vehicles and engines that are not within the range of 
light-duty passenger cars, light-duty trucks, and medium-duty passenger 
vehicles (MDPV) covered by separate GHG and Corporate Average Fuel 
Economy (CAFE) standards.\21\ (The terms also do not include 
motorcycles). Thus, in this rulemaking, unless specified otherwise, the 
heavy-duty category incorporates all vehicles with a gross vehicle 
weight rating above 8,500 lbs, and the engines that power them, except 
for MDPVs.22 23 24 Note also that the terms heavy-duty truck 
and heavy-duty vehicle are sometimes used interchangeably, even though 
commercially the term heavy-duty truck can have a narrower meaning.
---------------------------------------------------------------------------

    \21\ 2017 and Later Model Year Light-Duty Vehicle Greenhouse Gas 
Emissions and Corporate Average Fuel Economy Standards; Final Rule, 
77 FR 62623, October 15, 2012.
    \22\ The CAA defines heavy-duty as a truck, bus or other motor 
vehicles with a gross vehicle weight rating exceeding 6,000 lbs (CAA 
section 202(b)(3)). The term HD as used in this action refers to a 
subset of these vehicles and engines.
    \23\ The Energy Independence and Security Act of 2007 requires 
NHTSA to set standards for commercial medium- and heavy-duty on-
highway vehicles, defined as on-highway vehicles with a GVWR of 
10,000 lbs or more, and work trucks, defined as vehicles with a GVWR 
between 8,500 and 10,000 lbs and excluding medium duty passenger 
vehicles.
    \24\ The term ``medium-duty'' is sometimes used to refer to the 
lighter end of this range of vehicles. This is typically in the 
context of statutes or reports that use the term ``medium-duty.'' 
For example, because the term medium-duty is used in EISA, the term 
is also used in much of the discussion of NHTSA's statutory 
authority.
---------------------------------------------------------------------------

    Consistent with the President's direction, over the past three 
years as we have developed this rulemaking, the agencies have met on an 
on-going basis with a very large number of diverse stakeholders. This 
includes meetings, and in many cases site visits, with truck, trailer, 
and engine manufacturers; technology supplier companies and their trade 
associations (e.g., transmissions, drivelines, fuel systems, 
turbochargers, tires, catalysts, and many others); line haul and 
vocational trucking firms and trucking associations; the trucking 
industries owner-operator association; truck dealerships and dealers 
associations; trailer manufacturers and their trade association; non-
governmental organizations (NGOs, including environmental NGOs, 
national security NGOs, and consumer advocacy NGOs); state air quality 
agencies; manufacturing labor unions; and many other stakeholders. In 
addition, EPA and NHTSA have consulted on an on-going basis with the 
California Air Resources Board (CARB) over the past three years as we 
developed the Phase 2 rule. CARB staff and managers have also 
participated with EPA and NHTSA in meetings with many external 
stakeholders, including those with vehicle OEMs and technology 
suppliers.\25\
---------------------------------------------------------------------------

    \25\ Vehicle chassis manufacturers are known in this industry as 
original equipment manufacturers or OEMs.
---------------------------------------------------------------------------

    EPA and NHTSA staff also participated in a large number of 
technical and policy conferences over the past three years related to 
the technological, economic, and environmental aspects of the heavy-
duty trucking industry. The agencies also met with regulatory 
counterparts from several other nations who either have already or are 
considering establishing fuel consumption or GHG requirements, 
including outreach with representatives from the governments of Canada, 
the European Commission, Japan, and China.
    These comprehensive outreach actions by the agencies provided us 
with information to assist in our identification of potential 
technologies that can be used to reduce heavy-duty GHG emissions and 
improve fuel efficiency. The outreach has also helped the agencies to 
identify and understand the opportunities and challenges involved with 
these standards for the heavy-duty trucks, trailers, and engines 
detailed in this Preamble, including time needed for implementation of 
various technologies and potential costs and fuel savings. The scope of 
this outreach effort to gather input for the proposal and final 
rulemaking included well over 400 meetings with stakeholders. These 
meetings and conferences have been invaluable to the agencies. We 
believe they enabled us to refine the proposal in such a way as to 
appropriately consider all of the potential impacts and to minimize the 
possibility of unintended consequences in the final rules.

[[Page 73485]]

(1) Brief Overview of the Heavy-Duty Truck Industry
    The heavy-duty sector is diverse in several respects, including the 
types of manufacturing companies involved, the range of sizes of trucks 
and engines they produce, the types of work for which the trucks are 
designed, and the regulatory history of different subcategories of 
vehicles and engines. The current heavy-duty fleet encompasses vehicles 
from the ``18-wheeler'' combination tractor-trailers one sees on the 
highway to the largest pickup trucks and vans, as well as vocational 
vehicles covering the range between these extremes. Together, the HD 
sector spans a wide range of vehicles with often specialized form and 
function. A primary indicator of the diversity among heavy-duty trucks 
is the range of load-carrying capability across the industry. The 
heavy-duty truck sector is often subdivided by vehicle weight 
classifications, as defined by the vehicle's gross vehicle weight 
rating (GVWR), which is a measure of the combined curb (empty) weight 
and cargo carrying capacity of the truck.\26\ Table I-1 below outlines 
the vehicle weight classifications commonly used for many years for a 
variety of purposes by businesses and by several Federal agencies, 
including the Department of Transportation, the Environmental 
Protection Agency, the Department of Commerce, and the Internal Revenue 
Service.
---------------------------------------------------------------------------

    \26\ GVWR describes the maximum load that can be carried by a 
vehicle, including the weight of the vehicle itself. Heavy-duty 
vehicles (including those designed for primary purposes other than 
towing) also have a gross combined weight rating (GCWR), which 
describes the maximum load that the vehicle can haul, including the 
weight of a loaded trailer and the vehicle itself.

                                                        Table I-1--Vehicle Weight Classification
--------------------------------------------------------------------------------------------------------------------------------------------------------
                 Class                         2b               3                4                5                6                7              8
--------------------------------------------------------------------------------------------------------------------------------------------------------
GVWR (lb.)............................    8,501-10,000    10,001-14,000    14,001-16,000    16,001-19,500    19,501-26,000    26,001-33,000     >33,000
--------------------------------------------------------------------------------------------------------------------------------------------------------

In the framework of these vehicle weight classifications, the heavy-
duty truck sector refers to ``Class 2b'' through ``Class 8'' vehicles 
and the engines that power those vehicles.\27\
---------------------------------------------------------------------------

    \27\ Class 2b vehicles manufactured as passenger vehicles 
(Medium Duty Passenger Vehicles, MDPVs) are covered by the light-
duty GHG and fuel economy standards and therefore are not addressed 
in this rulemaking.
---------------------------------------------------------------------------

    Unlike light-duty vehicles, which are primarily used for 
transporting passengers for personal travel, heavy-duty vehicles fill 
much more diverse operator needs. Heavy-duty pickup trucks and vans 
(Classes 2b and 3) are used chiefly as work trucks and vans, and as 
shuttle vans, as well as for personal transportation, with an average 
annual mileage in the range of 15,000 miles. The rest of the heavy-duty 
sector is used for carrying cargo and/or performing specialized tasks. 
``Vocational'' vehicles, which span Classes 2b through 8, vary widely 
in size, including smaller and larger van trucks, utility ``bucket'' 
trucks, tank trucks, refuse trucks, urban and over-the-road buses, fire 
trucks, flat-bed trucks, and dump trucks, among others. The annual 
mileage of these vehicles is as varied as their uses, but for the most 
part tends to fall in between heavy-duty pickups/vans and the large 
combination tractors, typically from 15,000 to 150,000 miles per year.
    Class 7 and 8 combination tractor-trailers--some equipped with 
sleeper cabs and some not--are primarily used for freight 
transportation. They are sold as tractors and operate with one or more 
trailers that can carry up to 50,000 lbs or more of payload, consuming 
significant quantities of fuel and producing significant amounts of GHG 
emissions. Together, Class 7 and 8 tractors and trailers account for 
approximately 60 percent of the heavy-duty sector's total 
CO2 emissions and fuel consumption. Trailer designs vary 
significantly, reflecting the wide variety of cargo types. However, the 
most common types of trailers are box vans (dry and refrigerated), 
which are a focus of this Phase 2 rulemaking. The tractor-trailers used 
in combination applications can and frequently do travel more than 
150,000 miles per year and can operate for 20-30 years.
    Heavy-duty vehicles differ significantly from light-duty vehicles 
in other ways. In particular, we note that heavy-duty engines are much 
more likely to be rebuilt. In fact, it is common for Class 8 engines to 
be rebuilt multiple times. Commercial heavy-duty vehicles are often 
resold after a few years and may be repurposed by the second or third 
owner. Thus issues of resale value and adaptability have historically 
been key concerns for purchasers.
    EPA and NHTSA have designed our respective standards in careful 
consideration of the diversity and complexity of the heavy-duty truck 
industry, as discussed in Section I.C.
(2) Related Regulatory and Non-Regulatory Programs
(a) History of EPA's Heavy-Duty Regulatory Program and Assessments of 
the Impacts of Greenhouse Gases on Climate Change
    To provide a context for EPA's program to reduce greenhouse gas 
emissions from motor vehicles, this subsection provides an overview of 
two important related areas. First, we summarize the history of EPA's 
heavy-duty regulatory program, which provides a basis for the 
compliance structure of this rulemaking. Next we summarize EPA prior 
assessments of the impacts of greenhouse gases on climate change, which 
provides a basis for much of the analysis of the environmental benefits 
of this rulemaking.
(i) History of EPA's Heavy-Duty Regulatory Program
    Since the 1980s, EPA has acted several times to address tailpipe 
emissions of criteria pollutants and air toxics from heavy-duty 
vehicles and engines. During the last two decades these programs have 
primarily addressed emissions of particulate matter (PM) and the 
primary ozone precursors, hydrocarbons (HC) and oxides of nitrogen 
(NOX). These programs, which have successfully achieved 
significant and cost-effective reductions in emissions and associated 
health and welfare benefits to the nation, were an important basis of 
the Phase 1 program. See e.g. 66 FR 5002, 5008, and 5011-5012 (January 
18, 2001) (detailing substantial public health benefits of controls of 
criteria pollutants from heavy-duty diesel engines, including bringing 
areas into attainment with primary (public health) PM NAAQS, or 
contributing substantially to such attainment); National Petrochemical 
Refiners Association v. EPA, 287 F. 3d 1130, 1134 (D.C. Cir. 2002) 
(referring to the ``dramatic reductions'' in criteria pollutant 
emissions resulting from the EPA on-

[[Page 73486]]

highway heavy-duty engine standards, and upholding all of the 
standards).
    As required by the Clean Air Act (CAA), the emission standards 
implemented by these programs include standards that apply at the time 
that the vehicle or engine is sold and continue to apply in actual use. 
EPA's overall program goal has always been to achieve emissions 
reductions from the complete vehicles that operate on our roads. The 
agency has often accomplished this goal for many heavy-duty truck 
categories by regulating heavy-duty engine emissions. A key part of 
this success has been the development over many years of a well-
established, representative, and robust set of engine test procedures 
that industry and EPA now use routinely to measure emissions and 
determine compliance with emission standards. These test procedures in 
turn serve the overall compliance program that EPA implements to help 
ensure that emissions reductions are being achieved. By isolating the 
engine from the many variables involved when the engine is installed 
and operated in a HD vehicle, EPA has been able to accurately address 
the contribution of the engine alone to overall emissions.
(ii) EPA Assessment of the Impacts of Greenhouse Gases on Climate 
Change
    In 2009, the EPA Administrator issued the document known as the 
Endangerment Finding under CAA section 202(a)(1).\28\ In the 
Endangerment Finding, which focused on public health and public welfare 
impacts within the United States, the Administrator found that elevated 
concentrations of GHG emissions in the atmosphere may reasonably be 
anticipated to endanger public health and welfare of current and future 
generations. See also Coalition for Responsible Regulation v. EPA, 684 
F. 3d 102, 117-123 (D.C. Cir. 2012) (upholding the endangerment finding 
in all respects). The following sections summarize the key information 
included in the Endangerment Finding.
---------------------------------------------------------------------------

    \28\ ``Endangerment and Cause or Contribute Findings for 
Greenhouse Gases Under section 202(a) of the Clean Air Act,'' 74 FR 
66496 (December 15, 2009) (``Endangerment Finding'').
---------------------------------------------------------------------------

    Climate change caused by human emissions of GHGs threatens public 
health in multiple ways. By raising average temperatures, climate 
change increases the likelihood of heat waves, which are associated 
with increased deaths and illnesses. While climate change also 
decreases the likelihood of cold-related mortality, evidence indicates 
that the increases in heat mortality will be larger than the decreases 
in cold mortality in the United States. Compared to a future without 
climate change, climate change is expected to increase ozone pollution 
over broad areas of the U.S., including in the largest metropolitan 
areas with the worst ozone problems, and thereby increase the risk of 
morbidity and mortality. Other public health threats also stem from 
projected increases in intensity or frequency of extreme weather 
associated with climate change, such as increased hurricane intensity, 
increased frequency of intense storms and heavy precipitation. 
Increased coastal storms and storm surges due to rising sea levels are 
expected to cause increased drownings and other adverse health impacts. 
Children, the elderly, and the poor are among the most vulnerable to 
these climate-related health effects. See also 79 FR 75242 (December 
17, 2014) (climate change, and temperature increases in particular, 
likely to increase O3 (ozone) pollution ``over broad areas 
of the U.S., including the largest metropolitan areas with the worst 
O3 problems, increas[ing] the risk of morbidity and 
mortality'').
    Climate change caused by human emissions of GHGs also threatens 
public welfare in multiple ways. Climate changes are expected to place 
large areas of the country at serious risk of reduced water supplies, 
increased water pollution, and increased occurrence of extreme events 
such as floods and droughts. Coastal areas are expected to face 
increased risks from storm and flooding damage to property, as well as 
adverse impacts from rising sea level, such as land loss due to 
inundation, erosion, wetland submergence and habitat loss. Climate 
change is expected to result in an increase in peak electricity demand, 
and extreme weather from climate change threatens energy, 
transportation, and water resource infrastructure. Climate change may 
exacerbate ongoing environmental pressures in certain settlements, 
particularly in Alaskan indigenous communities. Climate change also is 
very likely to fundamentally rearrange U.S. ecosystems over the 21st 
century. Though some benefits may balance adverse effects on 
agriculture and forestry in the next few decades, the body of evidence 
points towards increasing risks of net adverse impacts on U.S. food 
production, agriculture and forest productivity as temperature 
continues to rise. These impacts are global and may exacerbate problems 
outside the U.S. that raise humanitarian, trade, and national security 
issues for the U.S. See also 79 FR 75382 (December 17, 2014) (welfare 
effects of O3 increases due to climate change, with emphasis 
on increased wildfires).
    As outlined in Section VIII.A of the 2009 Endangerment Finding, 
EPA's approach to providing the technical and scientific information to 
inform the Administrator's judgment regarding the question of whether 
GHGs endanger public health and welfare was to rely primarily upon the 
recent, major assessments by the U.S. Global Change Research Program 
(USGCRP), the Intergovernmental Panel on Climate Change (IPCC), and the 
National Research Council (NRC) of the National Academies. These 
assessments addressed the scientific issues that EPA was required to 
examine, were comprehensive in their coverage of the GHG and climate 
change issues, and underwent rigorous and exacting peer review by the 
expert community, as well as rigorous levels of U.S. government review. 
Since the administrative record concerning the Endangerment Finding 
closed following EPA's 2010 Reconsideration Denial, a number of new 
major, peer-reviewed scientific assessments have been released. These 
include the IPCC's 2012 ``Special Report on Managing the Risks of 
Extreme Events and Disasters to Advance Climate Change Adaptation'' 
(SREX) and the 2013-2014 Fifth Assessment Report (AR5), the USGCRP's 
2014 ``Climate Change Impacts in the United States'' (Climate Change 
Impacts), and the NRC's 2010 ``Ocean Acidification: A National Strategy 
to Meet the Challenges of a Changing Ocean'' (Ocean Acidification), 
2011 ``Report on Climate Stabilization Targets: Emissions, 
Concentrations, and Impacts over Decades to Millennia'' (Climate 
Stabilization Targets), 2011 ``National Security Implications for U.S. 
Naval Forces'' (National Security Implications), 2011 ``Understanding 
Earth's Deep Past: Lessons for Our Climate Future'' (Understanding 
Earth's Deep Past), 2012 ``Sea Level Rise for the Coasts of California, 
Oregon, and Washington: Past, Present, and Future,'' 2012 ``Climate and 
Social Stress: Implications for Security Analysis'' (Climate and Social 
Stress), and 2013 ``Abrupt Impacts of Climate Change'' (Abrupt Impacts) 
assessments.
    EPA has reviewed these new assessments and finds that the improved 
understanding of the climate system they present further strengthens 
the case that GHG emissions endanger public health and welfare.
    In addition, these assessments highlight the urgency of the 
situation as the concentration of CO2 in the atmosphere 
continues to rise. Absent a reduction in emissions, a recent

[[Page 73487]]

National Research Council assessment projected that concentrations by 
the end of the century would increase to levels that the Earth has not 
experienced for millions of years.\29\ In fact, that assessment stated 
that ``the magnitude and rate of the present greenhouse gas increase 
place the climate system in what could be one of the most severe 
increases in radiative forcing of the global climate system in Earth 
history.'' \30\ What this means, as stated in another NRC assessment, 
is that:
---------------------------------------------------------------------------

    \29\ National Research Council, Understanding Earth's Deep Past, 
p. 1.
    \30\ Id., p.138.

    Emissions of carbon dioxide from the burning of fossil fuels 
have ushered in a new epoch where human activities will largely 
determine the evolution of Earth's climate. Because carbon dioxide 
in the atmosphere is long lived, it can effectively lock Earth and 
future generations into a range of impacts, some of which could 
become very severe. Therefore, emission reductions choices made 
today matter in determining impacts experienced not just over the 
next few decades, but in the coming centuries and millennia.\31\
---------------------------------------------------------------------------

    \31\ National Research Council, Climate Stabilization Targets, 
p. 3.

    Moreover, due to the time-lags inherent in the Earth's climate, the 
Climate Stabilization Targets assessment notes that the full warming 
from any given concentration of CO2 reached will not be 
realized for several centuries.
    The most recent USGCRP ``National Climate Assessment'' \32\ 
emphasizes that climate change is already happening now and is 
happening in the United States. The assessment documents the increases 
in some extreme weather and climate events in recent decades, as well 
as the resulting damage and disruption to infrastructure and 
agriculture, and projects continued increases in impacts across a wide 
range of peoples, sectors, and ecosystems.
---------------------------------------------------------------------------

    \32\ U.S. Global Change Research Program, Climate Change Impacts 
in the United States: The Third National Climate Assessment, May 
2014 Available at http://nca2014.globalchange.gov/.
---------------------------------------------------------------------------

    These assessments underscore the urgency of reducing emissions now. 
Today's emissions will otherwise lead to raised atmospheric 
concentrations for thousands of years, and raised Earth system 
temperatures for even longer. Emission reductions today will benefit 
the public health and public welfare of current and future generations.
    Finally, it should be noted that the concentration of carbon 
dioxide in the atmosphere continues to rise dramatically. In 2009, the 
year of the Endangerment Finding, the average concentration of carbon 
dioxide as measured on top of Mauna Loa was 387 parts per million.\33\ 
The average concentration in 2015 was 401 parts per million, the first 
time an annual average has exceeded 400 parts per million since record 
keeping began at Mauna Loa in 1958, and for at least the past 800,000 
years according to ice core records.\34\ Moreover, 2015 was the warmest 
year globally in the modern global surface temperature record, going 
back to 1880, breaking the record previously held by 2014; this now 
means that the last 15 years have been 15 of the 16 warmest years on 
record.\35\
---------------------------------------------------------------------------

    \33\ ftp://aftp.cmdl.noaa.gov/products/trends/co2/co2_annmean_mlo.txt.
    \34\ http://www.esrl.noaa.gov/gmd/ccgg/trends/.
    \35\ http://www.ncdc.noaa.gov/sotc/global/201513.
---------------------------------------------------------------------------

(b) The EPA and NHTSA Light-Duty National GHG and Fuel Economy Program
    On May 7, 2010, EPA and NHTSA finalized the first-ever National 
Program for light-duty cars and trucks, which set GHG emissions and 
fuel economy standards for model years 2012-2016 (see 75 FR 25324). 
More recently, the agencies adopted even stricter standards for model 
years 2017 and later (77 FR 62624, October 15, 2012). The agencies have 
used the light-duty National Program as a model for the HD National 
Program in several respects. This is most apparent in the case of 
heavy-duty pickups and vans, which are similar to the light-duty trucks 
addressed in the light-duty National Program both technologically as 
well as in terms of how they are manufactured (i.e., the same company 
often makes both the vehicle and the engine, and several light-duty 
manufacturers also manufacture HD pickups and vans).\36\ For HD pickups 
and vans, there are close parallels to the light-duty program in how 
the agencies have developed our respective heavy-duty standards and 
compliance structures. However, HD pickups and vans are true work 
vehicles that are designed for much higher towing and payload 
capabilities than are light-duty pickups and vans. The technologies 
applied to light-duty trucks are not all applicable to heavy-duty 
pickups and vans at the same adoption rates, and the technologies often 
produce a lower percent reduction in CO2 emissions and fuel 
consumption when used in heavy-duty vehicles. Another difference 
between the light-duty and the heavy-duty standards is that each agency 
adopts heavy-duty standards based on attributes other than vehicle 
footprint, as discussed below.
---------------------------------------------------------------------------

    \36\ This is more broadly true for heavy-duty pickup trucks than 
vans because every manufacturer of heavy-duty pickup trucks also 
makes light-duty pickup trucks, while only some heavy-duty van 
manufacturers also make light-duty vans.
---------------------------------------------------------------------------

    Due to the diversity of the remaining HD vehicles, there are fewer 
parallels with the structure of the light-duty program. However, the 
agencies have maintained the same collaboration and coordination that 
characterized the development of the light-duty program throughout the 
Phase 1 rulemaking and the continued efforts for Phase 2. Most notably, 
as with the light-duty program, manufacturers will continue to be able 
to design and build vehicles to meet a closely coordinated, harmonized 
national program, and to avoid unnecessarily duplicative testing and 
compliance burdens. In addition, the averaging, banking, and trading 
provisions in the HD program, although structurally different from 
those of the light-duty program, serve the same purpose, which is to 
allow manufacturers to achieve large reductions in fuel consumption and 
emissions while providing a broad mix of products to their customers. 
The agencies have also worked closely with CARB to provide harmonized 
national standards.
(c) EPA's SmartWay Program
    EPA's voluntary SmartWay Transport Partnership program encourages 
businesses to take actions that reduce fuel consumption and 
CO2 emissions while cutting costs by working with the 
shipping, logistics, and carrier communities to identify low carbon 
strategies and technologies across their transportation supply chains. 
SmartWay provides technical information, benchmarking and tracking 
tools, market incentives, and partner recognition to facilitate and 
accelerate the adoption of these strategies. Through the SmartWay 
program and its related technology assessment center, EPA has worked 
closely with truck and trailer manufacturers and truck fleets over the 
past 12 years to develop test procedures to evaluate vehicle and 
component performance in reducing fuel consumption and has conducted 
testing and has established test programs to verify technologies that 
can achieve these reductions. SmartWay partners have demonstrated these 
new and emerging technologies in their business operations, adding to 
the body of technical data and information that EPA can disseminate to 
industry, researchers and other stakeholders. Over the last several 
years, EPA has developed hands-on experience testing the largest heavy-
duty trucks and trailers and evaluating improvements in tire and 
vehicle aerodynamic performance. In developing the Phase 1

[[Page 73488]]

program, the agencies drew from this testing and from the SmartWay 
experience. In the same way, the agencies benefitted from SmartWay in 
developing the Phase 2 trailer program.
(d) DOE's SuperTruck Initiative
    The U.S. Department of Energy launched its SuperTruck I initiative 
in 2009. SuperTruck I was a DOE partnership with four industry teams, 
who at this point have either met the SuperTruck I 50 percent fuel 
efficiency improvement goal (relative to a 2009 best-in-class truck) or 
have laid the groundwork to succeed. Teams from Cummins/Peterbilt, 
Daimler, and Volvo exceeded the 50 percent efficiency improvement goal, 
with Navistar on track to exceed this target later this year. Research 
vehicles developed under SuperTruck I are Class 8 combination tractor-
trailers that have dramatically increased fuel and freight efficiency 
through the use of advanced technologies. These technologies include 
tractor and trailer aerodynamic devices, engine waste heat recovery 
systems, hybrids, automated transmissions and lightweight materials. In 
March 2016 DOE announced SuperTruck II, which is an $80M follow-on to 
SuperTruck I, where DOE will continue to partner with industry teams to 
collaboratively fund new projects to research, develop, and demonstrate 
technologies to further improve heavy-truck freight efficiency--by more 
than 100 percent, relative to a manufacturer's best-in-class 2009 
truck. Achieving these kinds of Class 8 truck efficiency increases will 
require an integrated systems approach to ensure that the various 
components of the vehicle work well together. SuperTruck II projects 
will utilize a wide variety of truck and trailer technology approaches 
to achieve performance targets, such as further improvements in engine 
efficiency, drivetrain efficiency, aerodynamic drag, tire rolling 
resistance, and vehicle weight.
    The agencies leveraged the outcomes of SuperTruck I by projecting 
how these tractor and trailer technologies could continue to advance 
from this early developmental stage toward the prototype and production 
stages. For a number of the SuperTruck technologies, the agencies are 
projecting advancement into production, given appropriate lead time. 
For example, a number of the aerodynamic and transmission technologies 
are projected to be in widespread production by 2021, and the agencies 
are finalizing 2021 standards based in part on performance of these 
SuperTruck technologies. For other more advanced SuperTruck 
technologies, such as organic Rankine cycle waste heat recovery 
systems, the agencies are projecting that additional lead time is 
needed to ensure that these technologies will be effective and reliable 
in production. For these technologies, the agencies are finalizing 2027 
standards whose stringency reflects a significant market adoption rate 
of advanced technologies, including waste heat recovery systems. 
Furthermore, the agencies are encouraged by DOE's announcement of 
SuperTruck II. We believe that the combination of HD Phase 2 and 
SuperTruck II will provide both a strong motivation and a proven means 
for manufacturers to fully develop these technologies within the lead 
times we have projected.
(e) The State of California
    California has established ambitious goals for reducing GHG 
emissions from heavy-duty vehicles and engines as part of an overall 
plan to reduce GHG emissions from the transportation sector in 
California.\37\ Heavy-duty vehicles are responsible for one-fifth of 
the total GHG emissions from transportation sources in California. In 
the past several years, the California Air Resources Board (CARB) has 
taken a number of actions to reduce GHG emissions from heavy-duty 
vehicles and engines. For example, in 2008, CARB adopted regulations to 
reduce GHG emissions from heavy-duty tractors that pull box-type 
trailers through improvements in tractor and trailer aerodynamics and 
the use of low rolling resistance tires.\38\ The tractor-trailer 
operators subject to the CARB regulation are required to use SmartWay-
certified tractors and trailers, or retrofit their existing fleet with 
SmartWay-verified technologies, consistent with California's state 
authority to regulate both new and in-use vehicles. In December 2013, 
CARB adopted regulations that establish its own parallel Phase 1 
program with standards consistent with EPA Phase 1 standards. On 
December 5, 2014, California's Office of Administrative Law approved 
CARB's adoption of the Phase 1 standards, with an effective date of 
December 5, 2014.\39\ Complementary to its regulatory efforts, CARB and 
other California agencies are investing significant public capital 
through various incentive programs to accelerate fleet turnover and 
stimulate technology innovation within the heavy-duty vehicle market 
(e.g., Air Quality Improvement, Carl Moyer, Loan Incentives, Lower-
Emission School Bus and Goods Movement Emission Reduction 
Programs).\40\ Recently, California Governor Jerry Brown established a 
target of up to 50 percent petroleum reduction by 2030.
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    \37\ See http://www.arb.ca.gov/cc/cc.htm for details on the 
California Air Resources Board climate change actions, including a 
discussion of Assembly Bill 32, and the Climate Change Scoping Plan 
developed by CARB, which includes details regarding CARB's future 
goals for reducing GHG emissions from heavy-duty vehicles.
    \38\ See http://www.arb.ca.gov/msprog/truckstop/trailers/trailers.htm for a summary of CARB's ``Tractor-Trailer Greenhouse 
Gas Regulation.''
    \39\ See http://www.arb.ca.gov/regact/2013/hdghg2013/hdghg2013.htm for details regarding CARB's adoption of the Phase 1 
standards.
    \40\ See http://www.arb.ca.gov/ba/fininfo.htm for detailed 
descriptions of CARB's mobile source incentive programs. Note that 
EPA works to support CARB's heavy-duty incentive programs through 
the West Coast Collaborative (http://westcoastcollaborative.org/) 
and the Clean Air Technology Initiative (https://www.epa.gov/cati).
---------------------------------------------------------------------------

    California has long had the unique ability among states to adopt 
its own separate new motor vehicle standards per section 209 of the 
Clean Air Act (CAA). Although section 209(a) of the CAA expressly 
preempts states from adopting and enforcing standards relating to the 
control of emissions from new motor vehicles or new motor vehicle 
engines (such as state controls for new heavy-duty engines and 
vehicles), CAA section 209(b) directs EPA to waive this preemption 
under certain conditions. Under the waiver process set out in CAA 
section 209(b), EPA has granted CARB a waiver for its initial heavy-
duty vehicle GHG regulation.\41\ Even with California's ability under 
the CAA to establish its own emission standards, EPA and CARB have 
worked closely together over the past several decades to largely 
harmonize new vehicle criteria pollutant standard programs for heavy-
duty engines and heavy-duty vehicles. In the past several years EPA and 
NHTSA also consulted with CARB in the development of the Federal light-
duty vehicle GHG and CAFE rulemakings for the 2012-2016 and 2017-2025 
model years.
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    \41\ See EPA's waiver of CARB's heavy-duty tractor-trailer 
greenhouse gas regulation applicable to new 2011 through 2013 model 
year Class 8 tractors equipped with integrated sleeper berths 
(sleeper-cab tractors) and 2011 and subsequent model year dry-can 
and refrigerated-van trailers that are pulled by such tractors on 
California highways at 79 FR 46256 (August 7, 2014).
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    As discussed above, California operates under state authority to 
establish its own new heavy-duty vehicle and engine emission standards, 
including standards for CO2, methane, N2O, and 
hydrofluorocarbons. EPA recognizes this independent authority, and we 
also recognize the potential benefits for the regulated industry if the 
Federal Phase 2 standards could result

[[Page 73489]]

in a single, National Program that would meet the EPA and NHTSA's 
statutory requirements to set appropriate and maximum feasible 
standards, and also be equivalent to potential future new heavy-duty 
vehicle and engine GHG standards established by CARB (addressing the 
same model years as addressed by the final Federal Phase 2 program and 
requiring the same technologies). In order to further the opportunity 
for maintaining coordinated Federal and California standards in the 
Phase 2 timeframe (as well as to benefit from different technical 
expertise and perspective), EPA and NHTSA consulted frequently with 
CARB while developing the Phase 2 rule. Prior to the proposal, the 
agencies' technical staff shared information on technology cost, 
technology effectiveness, and feasibility with the CARB staff. We also 
received information from CARB on these same topics. In addition, CARB 
staff and managers participated with EPA and NHTSA in meetings with 
many external stakeholders, in particular with vehicle OEMs and 
technology suppliers. The agencies continued significant consultation 
during the development of the final rules.
    EPA and NHTSA believe that through this information sharing and 
dialog we have enhanced the potential for the Phase 2 program to result 
in a National Program that can be adopted not only by the Federal 
agencies, but also by the State of California, given the strong 
interest from the regulated industry for a harmonized State and Federal 
program. In its public comments, California reiterated its support for 
a harmonized State and Federal program, although it identified several 
areas in which it believed the proposed program needed to be 
strengthened.
(f) Environment and Climate Change Canada
    On March 13, 2013, Environment and Climate Change Canada (ECCC), 
which is EPA's Canadian counterpart, published its own regulations to 
control GHG emissions from heavy-duty vehicles and engines, beginning 
with MY 2014. These regulations are closely aligned with EPA's Phase 1 
program to achieve a common set of North American standards. ECCC has 
expressed its intention to amend these regulations to further limit 
emissions of greenhouse gases from new on-road heavy-duty vehicles and 
their engines for post-2018 MYs. As with the development of the current 
regulations, ECCC is committed to continuing to work closely with EPA 
to maintain a common Canada-United States approach to regulating GHG 
emissions for post-2018 MY vehicles and engines. This approach will 
build on the long history of regulatory alignment between the two 
countries on vehicle emissions pursuant to the Canada-United States Air 
Quality Agreement.\42\ In furtherance of this coordination, EPA 
participated in a workshop hosted by ECCC on March 3, 2016 to discuss 
Canada's Phase 2 program.\43\
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    \42\ http://www.ijc.org/en_/Air_Quality__Agreement.
    \43\ ``Phase 2 of the Heavy-duty Vehicle and Engine Greenhouse 
Gas Emission Regulations; Pre-Consultation Session,'' March 3, 2016.
---------------------------------------------------------------------------

    The Government of Canada, including ECCC and Transport Canada, has 
also been of great assistance during the development of this Phase 2 
rule. In particular, the Government of Canada supported aerodynamic 
testing, and conducted chassis dynamometer emissions testing.
(g) Recommendations of the National Academy of Sciences
    In April 2010, as mandated by Congress in the EISA, the National 
Research Council (NRC) under the National Academy of Sciences (NAS) 
issued a report to NHTSA and to Congress evaluating medium- and heavy-
duty truck fuel efficiency improvement opportunities, titled 
``Technologies and Approaches to Reducing the Fuel Consumption of 
Medium- and Heavy-duty Vehicles.'' That NAS report was far reaching in 
its review of the technologies that were available and that might 
become available in the future to reduce fuel consumption from medium- 
and heavy-duty vehicles. In presenting the full range of technical 
opportunities, the report included technologies that may not be 
available until 2020 or even further into the future. The report 
provided not only a valuable list of off-the-shelf technologies from 
which the agencies drew in developing the Phase 1 program, but also 
provided useful information the agencies have considered when 
developing this second phase of regulations.
    In April 2014, the NAS issued another report: ``Reducing the Fuel 
Consumption and Greenhouse Gas Emissions of Medium- and Heavy-Duty 
Vehicles, Phase Two, First Report.'' \44\ This study outlines a number 
of recommendations to the U.S. Department of Transportation and NHTSA 
on technical and policy matters to consider when addressing the fuel 
efficiency of our nation's medium- and heavy-duty vehicles. In 
particular, this report provided recommendations with respect to:
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    \44\ National Research Council ``Reducing the Fuel Consumption 
and Greenhouse Gas Emissions of Medium- and Heavy-Duty Vehicles, 
Phase Two.'' Washington, DC, The National Academies Press. 
Cooperative Agreement DTNH22-12-00389. Available electronically from 
the National Academy Press Web site at http://www.nap.edu/catalog/18736/reducing-the-fuel-consumption-and-greenhouse-gas-emissions-of-medium-and-heavy-duty-vehicles-phase-two (last accessed May 18, 
2016). On September 24, 2016, NAS will release an update report, 
consistent with Congress' quinquennial update requirement.

 The Greenhouse Gas Emission Model (GEM) simulation tool used 
by the agencies to assess compliance with vehicle standards
 Regulation of trailers
 Natural gas-fueled engines and vehicles
 Data collection on in-use operation

    The agencies are adopting many of these recommendations into the 
Phase 2 program, including recommendations relating to the GEM 
simulation tool and to trailers.

B. Summary of Phase 1 Program

(1) EPA Phase 1 GHG Emission Standards and NHTSA Phase 1 Fuel 
Consumption Standards
    The EPA Phase 1 mandatory GHG emission standards commenced in MY 
2014 and include increased stringency for standards applicable to MY 
2017 and later MY vehicles and engines. NHTSA's fuel consumption 
standards were voluntary for MYs 2014 and 2015, due to lead time 
requirements in EISA, and apply on a mandatory basis thereafter. They 
also increase in stringency for MY 2017. Both agencies allowed 
voluntary early compliance starting in MY 2013 and encouraged 
manufacturers' participation through credit incentives.
    Given the complexity of the heavy-duty industry, the agencies 
divided the industry into three discrete categories for purposes of 
setting our respective Phase 1 standards--combination tractors, heavy-
duty pickups and vans, and vocational vehicles--based on the relative 
degree of homogeneity among trucks within each category. The Phase 1 
rules also include separate standards for the engines that power 
combination tractors and vocational vehicles. For each regulatory 
category, the agencies adopted related but distinct program approaches 
reflecting the specific challenges in these segments. In the following 
paragraphs, we briefly summarize EPA's Phase 1 GHG emission standards 
and NHTSA's Phase 1 fuel consumption standards for the three regulatory 
categories of heavy-duty vehicles and for the engines powering 
vocational vehicles and

[[Page 73490]]

tractors. See Sections II, III, V, and VI for additional details on the 
Phase 1 standards. To respect differences in design and typical uses 
that drive different technology solutions, the agencies segmented each 
regulatory class into subcategories. The category-specific structure 
enabled the agencies to set standards that appropriately reflect the 
technology available for each regulatory subcategory of vehicles and 
the engines for use in each type of vehicle. The Phase 1 program also 
provided several flexibilities, as summarized in Section I.B.(3).
    The agencies proposed and are adopting Phase 2 standards based on 
test procedures that differ from those used for Phase 1, including the 
revised GEM simulation tool. Significant revisions to GEM are discussed 
in Section II and in the RIA Chapter 4, and other test procedures are 
discussed further in the RIA Chapter 3. The pre-proposal revisions from 
Phase 1 GEM reflected input from both the NAS and from industry.\45\ 
Changes since the proposal generally reflect comments received from 
industry and other key stakeholders. It is important to note that due 
to these test procedure changes, the Phase 1 and Phase 2 standards are 
not directly comparable in an absolute sense. In particular, the 
revisions being made to the 55 mph and 65 mph highway cruise cycles for 
tractors and vocational vehicles have the effect of making the cycles 
more challenging (albeit more representative of actual driving 
conditions). We are not applying these revisions to the Phase 1 program 
because doing so would significantly change the stringency of the Phase 
1 standards, for which manufacturers have already developed engineering 
plans and are now producing products to meet. Moreover, the changes to 
GEM address a broader range of technologies not part of the projected 
compliance path for use in Phase 1.
---------------------------------------------------------------------------

    \45\ For further discussion of the input the agencies received 
from NAS, see Section XII of the Phase 2 NPRM at 80 FR 40512, July 
13, 2015.
---------------------------------------------------------------------------

    Because the numeric values of the Phase 2 tractor and vocational 
standards are not directly comparable to their respective Phase 1 
standards, the Phase 1 numeric standards were not appropriate baseline 
values to use to determine Phase 2's improvements. To address this 
situation, the agencies applied all of the new Phase 2 test procedures 
and GEM software to tractors and vocational vehicles equipped with 
Phase 1 compliant levels of technology. The agencies used the results 
of this approach to establish appropriate Phase 1 baseline values, 
which are directly comparable to the Phase 2 standards. For example, in 
this rulemaking we present Phase 2 per vehicle percent reductions 
versus Phase 1, and for tractors and vocational vehicles these percent 
reductions were all calculated versus Phase 1 compliant vehicles, where 
we applied the Phase 2 test procedures and GEM software to determine 
these Phase 1 vehicles' results.
(a) Class 7 and 8 Combination Tractors
    Class 7 and 8 combination tractors and their engines contribute the 
largest portion of the total GHG emissions and fuel consumption of the 
heavy-duty sector, approximately 60 percent, due to their large 
payloads, their high annual miles traveled, and their major role in 
national freight transport. These vehicles consist of a cab and engine 
(tractor or combination tractor) and a detachable trailer. The primary 
manufacturers of combination tractors in the United States are Daimler 
Trucks North America, Navistar, Volvo/Mack, and PACCAR. Each of the 
tractor manufacturers and Cummins (an independent engine manufacturer) 
also produce heavy-duty engines used in tractors. The Phase 1 standards 
require manufacturers to reduce GHG emissions and fuel consumption for 
these tractors and engines, which we expect them to do through 
improvements in aerodynamics and tires, reductions in tractor weight, 
reduction in idle operation, as well as engine-based efficiency 
improvements.\46\
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    \46\ We note although the standards' stringency is predicated on 
use of certain technologies, and the agencies' assessed the cost of 
the rule based on the cost of use of those technologies, the 
standards can be met by any means. Put another way, the rules create 
a performance standard, and do not mandate any particular means of 
achieving that level of performance.
---------------------------------------------------------------------------

    The Phase 1 tractor standards differ depending on gross vehicle 
weight rating (GVWR) (i.e., whether the truck is Class 7 or Class 8), 
the height of the roof of the cab, and whether it is a ``day cab'' or a 
``sleeper cab.'' The agencies created nine subcategories within the 
Class 7 and 8 combination tractor category reflecting combinations of 
these attributes. The agencies set Phase 1 standards for each of these 
subcategories beginning in MY 2014, with more stringent standards 
following in MY 2017. The standards represent an overall fuel 
consumption and CO2 emissions reduction up to 23 percent 
from the tractors and the engines installed in them when compared to a 
baseline MY 2010 tractor and engine.
    For Phase 1, tractor manufacturers demonstrate compliance with the 
tractor CO2 and fuel consumption standards using a vehicle 
simulation tool described in Section II. The tractor inputs to the 
simulation tool in Phase 1 are the aerodynamic performance, tire 
rolling resistance, vehicle speed limiter, automatic engine shutdown, 
and weight reduction.
    In addition to the Phase 1 tractor-based standards for 
CO2, EPA adopted a separate standard to reduce leakage of 
hydrofluorocarbon (HFC) refrigerant from cabin air conditioning (A/C) 
systems from combination tractors, to apply to the tractor 
manufacturer. This HFC leakage standard is independent of the 
CO2 tractor standard. Manufacturers can choose technologies 
from a menu of leak-reducing technologies sufficient to comply with the 
standard, as opposed to using a test to measure performance. Given that 
HFC leakage does not relate to fuel efficiency, NHTSA did not adopt 
corresponding HFC standards.
(b) Heavy-Duty Pickup Trucks and Vans (Class 2b and 3)
    Heavy-duty vehicles with a GVWR between 8,501 and 10,000 lb. are 
classified as Class 2b motor vehicles. Heavy-duty vehicles with a GVWR 
between 10,001 and 14,000 lb. are classified as Class 3 motor vehicles. 
Class 2b and Class 3 heavy-duty vehicles (referred to in these rules as 
``HD pickups and vans'') together emit about 23 percent of today's GHG 
emissions from the heavy-duty vehicle sector.\47\
---------------------------------------------------------------------------

    \47\ EPA MOVES Model, http://www3.epa.gov/otaq/models/moves/index.htm.
---------------------------------------------------------------------------

    The majority of HD pickups and vans are \3/4\-ton and 1-ton pickup 
trucks, 12- and 15-passenger vans,\48\ and large work vans that are 
sold by vehicle manufacturers as complete vehicles, with no secondary 
manufacturer making substantial modifications prior to registration and 
use. These vehicles can also be sold as cab-complete vehicles (i.e., 
incomplete vehicles that include complete or nearly complete cabs that 
are sold to secondary manufacturers). The majority of heavy-duty 
pickups and vans are produced by companies with major light-duty 
markets in the United States. Furthermore, the technologies available 
to reduce fuel consumption and GHG emissions from this segment are 
similar to the technologies used on light-duty pickup trucks, including 
both engine efficiency improvements (for gasoline and diesel engines) 
and vehicle efficiency improvements. For these reasons, EPA and NHTSA 
concluded

[[Page 73491]]

that it was appropriate to adopt GHG standards, expressed as grams per 
mile, and fuel consumption standards, expressed as gallons per 100 
miles, for HD pickups and vans based on the whole vehicle (including 
the engine), consistent with the way these vehicles have been regulated 
by EPA for criteria pollutants and also consistent with the way their 
light-duty counterpart vehicles are regulated by EPA and NHTSA. This 
complete vehicle approach adopted by both agencies for HD pickups and 
vans was consistent with the recommendations of the NAS Committee in 
its 2010 Report.
---------------------------------------------------------------------------

    \48\ Note that 12-passenger vans are subject to the light-duty 
standards as medium-duty passenger vehicles (MDPVs) and are not 
subject to this proposal.
---------------------------------------------------------------------------

    For the light-duty GHG and fuel economy standards, the agencies 
based the emissions and fuel economy targets on vehicle footprint (the 
wheelbase times the average track width). For those standards, 
passenger cars and light trucks with larger footprints are assigned 
higher GHG and lower fuel economy target levels reflecting their 
inherent tendency to consume more fuel and emit more GHGs per mile. For 
HD pickups and vans, the agencies believe that setting standards based 
on vehicle attributes is appropriate, but have found that a work-based 
metric is a more appropriate attribute than the footprint attribute 
utilized in the light-duty vehicle rulemaking, given that work-based 
measures such as towing and payload capacities are critical elements of 
these vehicles' functionality. EPA and NHTSA therefore adopted 
standards for HD pickups and vans based on a ``work factor'' attribute 
that combines their payload and towing capabilities, with an added 
adjustment for 4-wheel drive vehicles.
    Each manufacturer's fleet average Phase 1 standard is based on 
production volume-weighting of target standards for all vehicles, which 
in turn are based on each vehicle's work factor. These target standards 
are taken from a set of curves (mathematical functions), with separate 
curves for gasoline and diesel vehicles.\49\ However, both gasoline and 
diesel vehicles in this category are included in a single averaging 
set. EPA phased in the CO2 standards gradually starting in 
the 2014 MY, at 15-20-40-60-100 percent of the MY 2018 standards 
stringency level in MYs 2014-2015-2016-2017-2018, respectively (i.e., 
the 2014 standards requires only 15 percent of the reduction required 
in 2018, etc.). The phase-in takes the form of a set of target curves, 
with increasing stringency in each MY.
---------------------------------------------------------------------------

    \49\ As explained in Section XI, as part of this rulemaking, EPA 
moved the Phase 1 requirements for pickups and vans from 40 CFR 
1037.104 into 40 CFR part 86, which is also the regulatory part that 
applies for light-duty vehicles.
---------------------------------------------------------------------------

    NHTSA allowed manufacturers to select one of two fuel consumption 
standard alternatives for MYs 2016 and later. The first alternative 
defined individual gasoline vehicle and diesel vehicle fuel consumption 
target curves that will not change for MYs 2016-2018, and are 
equivalent to EPA's 67-67-67-100 percent target curves in MYs 2016-
2017-2018-2019, respectively. The second alternative defined target 
curves that are equivalent to EPA's 40-60-100 percent target curves in 
MYs 2016-2017-2018, respectively. NHTSA allowed manufacturers to opt 
voluntarily into the NHTSA HD pickup and van program in MYs 2014 or 
2015 at target curves equivalent to EPA's target curves. If a 
manufacturer chose to opt in for one category, they would be required 
to opt in for all categories. In other words, a manufacturer would be 
unable to opt in for Class 2b vehicles, but opt out for Class 3 
vehicles.
    EPA also adopted an alternative phase-in schedule for manufacturers 
wanting to have stable standards for model years 2016-2018. The 
standards for heavy-duty pickups and vans, like those for light-duty 
vehicles, are expressed as set of target standard curves, with 
increasing stringency in each model year. The Phase 1 EPA standards for 
2018 (including a separate standard to control air conditioning system 
leakage) are estimated to represent an average per-vehicle reduction in 
GHG emissions of 17 percent for diesel vehicles and 12 percent for 
gasoline vehicles (relative to pre-control baseline vehicles). The 
NHTSA standard will require these vehicles to achieve up to about 15 
percent reduction in fuel consumption by MY 2018 (relative to pre-
control baseline vehicles). Manufacturers demonstrate compliance based 
on entire vehicle chassis certification using the same duty cycles used 
to demonstrate compliance with criteria pollutant standards.
(c) Class 2b-8 Vocational Vehicles
    Class 2b-8 vocational vehicles include a wide variety of vehicle 
types, and serve a vast range of functions. Some examples include 
service for parcel delivery, refuse hauling, utility service, dump, 
concrete mixing, transit service, shuttle service, school bus, 
emergency, motor homes, and tow trucks. In Phase 1, we defined Class 
2b-8 vocational vehicles as all heavy-duty vehicles that are not 
included in either the heavy-duty pickup and van category or the Class 
7 and 8 tractor category. EPA's and NHTSA's Phase 1 standards for this 
vocational vehicle category generally apply at the chassis manufacturer 
level. Class 2b-8 vocational vehicles and their engines emit 
approximately 17 percent of the GHG emissions and burn approximately 17 
percent of the fuel consumed by today's heavy-duty truck sector.\50\
---------------------------------------------------------------------------

    \50\ EPA MOVES model, http://www3.epa.gov/otaq/models/moves/index.htm.
---------------------------------------------------------------------------

    The Phase 1 program for vocational vehicles has vehicle standards 
and separate engine standards, both of which differ based on the weight 
class of the vehicle into which the engine will be installed. The 
vehicle weight class groups mirror those used for the engine 
standards--Classes 2b-5 (light heavy-duty or LHD in EPA regulations), 
Classes 6 and 7 (medium heavy-duty or MHD in EPA regulations) and Class 
8 (heavy heavy-duty or HHD in EPA regulations). Manufacturers 
demonstrate compliance with the Phase 1 vocational vehicle 
CO2 and fuel consumption standards using a vehicle 
simulation tool described in Section II. The Phase 1 program for 
vocational vehicles limited the simulation tool inputs to tire rolling 
resistance. The model assumes the use of a typical representative, 
compliant engine in the simulation, resulting in one overall value for 
CO2 emissions and one for fuel consumption.
(d) Engine Standards
    The agencies established separate Phase 1 performance standards for 
the engines manufactured for use in vocational vehicles and Class 7 and 
8 tractors.\51\ These engine standards vary depending on engine size 
linked to intended vehicle service class. EPA's engine-based 
CO2 standards and NHTSA's engine-based fuel consumption 
standards are being implemented using EPA's existing test procedures 
and regulatory structure for criteria pollutant emissions from heavy-
duty engines. EPA also established engine-based N2O and 
CH4 emission standards in Phase 1.
---------------------------------------------------------------------------

    \51\ See 76 FR 57114 explaining why NHTSA's authority under the 
Energy Independence and Safety Act includes authority to establish 
separate engine standards.
---------------------------------------------------------------------------

(e) Manufacturers Excluded From the Phase 1 Standards
    Phase 1 deferred greenhouse gas emissions and fuel consumption 
standards for any manufacturers of heavy-duty engines, manufacturers of 
combination tractors, and chassis manufacturers for vocational vehicles 
that meet the ``small business'' size criteria set by the Small 
Business Administration (SBA). 13 CFR 121.201

[[Page 73492]]

defines a small business by the maximum number of employees; for 
example, this is currently 1,500 for heavy-duty truck manufacturing and 
1,000 for engine manufacturing.\52\ In order to utilize this exemption, 
qualifying small businesses must submit a declaration to the agencies. 
See Section I.F.(1)(b) for a summary of how Phase 2 applies for small 
businesses.
---------------------------------------------------------------------------

    \52\ These thresholds were revised in early 2016. See http://www.regulations.gov/#!documentDetail;D=SBA-2014-0011-0031.
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    The agencies stated that they would consider appropriate GHG and 
fuel consumption standards for these entities as part of a future 
regulatory action. This includes both U.S.-based and foreign small-
volume heavy-duty manufacturers that introduce new products into the 
U.S.
(2) Costs and Benefits of the Phase 1 Program
    Overall, EPA and NHTSA estimated that the Phase 1 HD National 
Program will cost the affected industry about $8 billion, while saving 
vehicle owners fuel costs of nearly $50 billion over the lifetimes of 
MY 2014-2018 vehicles. The agencies also estimated that the combined 
standards will reduce CO2 emissions by about 270 million 
metric tons and save about 530 million barrels of oil over the life of 
MY 2014 to 2018 vehicles. The agencies estimated additional monetized 
benefits from CO2 reductions, improved energy security, 
reduced time spent refueling, as well as possible dis-benefits from 
increased driving crashes, traffic congestion, and noise. When 
considering all these factors, we estimated that Phase 1 of the HD 
National Program will yield $49 billion in net benefits to society over 
the lifetimes of MY 2014-2018 vehicles.
    EPA estimated the benefits of reduced ambient concentrations of 
particulate matter and ozone resulting from the Phase 1 program to 
range from $1.3 to $4.2 billion in 2030.\53\
---------------------------------------------------------------------------

    \53\ Note: These calendar year benefits do not represent the 
same time frame as the model year lifetime benefits described above, 
so they are not additive.
---------------------------------------------------------------------------

    In total, we estimated the combined Phase 1 standards will reduce 
GHG emissions from the U.S. heavy-duty fleet by approximately 76 
million metric tons of CO2-equivalent annually by 2030. In 
its Environmental Impact Statement for the Phase 1 rule, NHTSA also 
quantified and/or discussed other potential impacts of the program, 
such as the health and environmental impacts associated with changes in 
ambient exposures to toxic air pollutants and the benefits associated 
with avoided non-CO2 GHGs (methane, nitrous oxide, and 
HFCs).
(3) Phase 1 Program Flexibilities
    As noted above, the agencies adopted numerous provisions designed 
to give manufacturers a degree of flexibility in complying with the 
Phase 1 standards. These provisions, which are essentially identical in 
structure and function in EPA's and NHTSA's regulations, enabled the 
agencies to consider overall standards that are more stringent and that 
will become effective sooner than we could consider with a more rigid 
program, one in which all of a manufacturer's similar vehicles or 
engines would be required to achieve the same emissions or fuel 
consumption levels, and at the same time.\54\
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    \54\ NHTSA explained that it has greater flexibility in the HD 
program to include consideration of credits and other flexibilities 
in determining appropriate and feasible levels of stringency than it 
does in the light-duty CAFE program. Cf. 49 U.S.C. 32902(h), which 
applies to light-duty CAFE but not heavy-duty fuel efficiency under 
49 U.S.C. 32902(k).
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    Phase 1 included four primary types of flexibility: Averaging, 
banking, and trading (ABT) provisions; early credits; advanced 
technology credits (including hybrid powertrains); and innovative 
technology credit provisions. The ABT provisions were patterned on 
existing EPA and NHTSA ABT programs (including the light-duty GHG and 
fuel economy standards) and will allow a vehicle manufacturer to reduce 
CO2 emission and fuel consumption levels further than the 
level of the standard for one or more vehicles to generate ABT credits. 
The manufacturer can use those credits to offset higher emission or 
fuel consumption levels in the same averaging set, ``bank'' the credits 
for later use, or ``trade'' the credits to another manufacturer. As 
also noted above, for HD pickups and vans, we adopted a fleet averaging 
system very similar to the light-duty GHG and CAFE fleet averaging 
system. In both programs, manufacturers are allowed to carry-forward 
deficits for up to three years without penalty. The agencies provided 
in the ABT programs flexibility for situations in which a manufacturer 
is unable to avoid a negative credit balance at the end of the year. In 
such cases, manufacturers are not considered to be out of compliance 
unless they are unable to make up the difference in credits by the end 
of the third subsequent model year.
    In total, the Phase 1 program divides the heavy-duty sector into 14 
subcategories of vehicles and 4 subcategories of engines. These 
subcategories are grouped into 4 vehicle averaging sets and 4 engine 
averaging sets in the ABT program. For tractors and vocational 
vehicles, the fleet averaging sets are: Light heavy-duty (Classes 2b-
5); medium heavy-duty (Class 6-7); and heavy heavy-duty (Class 8). 
Complete HD pickups and vans (both spark-ignition and compression-
ignition) are the final vehicle averaging set. For engines, the fleet 
averaging sets are spark-ignition engines, compression-ignition light 
heavy-duty engines, compression-ignition medium heavy-duty engines, and 
compression-ignition heavy heavy-duty engines. ABT allows the exchange 
of credits within an averaging set. This means that a Class 8 day cab 
tractor can exchange credits with a Class 8 sleeper tractor but not 
with a smaller Class 7 tractor. Also, a Class 8 vocational vehicle can 
exchange credits with a Class 8 tractor. However, we did not allow 
trading between engines and chassis (i.e. vehicles).
    In addition to ABT, the other primary flexibility provisions in the 
Phase 1 program involve opportunities to generate early credits, 
advanced technology credits (including for use of hybrid powertrains), 
and innovative technology credits.\55\ For the early credits and 
advanced technology credits, the agencies adopted a 1.5x multiplier, 
meaning that manufacturers would get 1.5 credits for each early credit 
and each advanced technology credit. In addition, advanced technology 
credits for Phase 1 can be used anywhere within the heavy-duty sector 
(including both vehicles and engines). Put another way, as a means of 
promoting these promising technologies, the Phase 1 rule does not 
restrict averaging or trading by averaging set in this instance.
---------------------------------------------------------------------------

    \55\ Early credits are for engines and vehicles certified before 
EPA standards became mandatory, advanced technology credits are for 
hybrids and/or Rankine cycle engines, and innovative technology 
credits are for other technologies not in the 2010 fleet whose 
benefits are not reflected using the Phase 1 test procedures.
---------------------------------------------------------------------------

    For other vehicle or engine technologies that can reduce 
CO2 and fuel consumption, but whose benefits are not 
reflected if measured using the Phase 1 test procedures, the agencies 
wanted to encourage the development of such innovative technologies, 
and therefore adopted special ``innovative technology'' credits. These 
innovative technology credits apply to technologies that are shown to 
produce emission and fuel consumption reductions that are not 
adequately recognized on the Phase 1 test procedures and that were not 
yet in widespread use in the heavy-duty sector before MY 2010. 
Manufacturers

[[Page 73493]]

need to quantify the reductions in fuel consumption and CO2 
emissions that the technology is expected to achieve, above and beyond 
those achieved on the Phase 1 test procedures. As with ABT, the use of 
innovative technology credits is allowed only among vehicles and 
engines of the same defined averaging set generating the credit, as 
described above. The credit multiplier likewise does not apply for 
innovative technology credits.
(4) Implementation of Phase 1
    Manufacturers have already begun complying with the Phase 1 
standards. In some cases manufacturers voluntarily chose to comply 
early, before compliance was mandatory. The Phase 1 rule allowed 
manufacturers to generate credits for such early compliance. The market 
appears to be very accepting of the new technologies, and the agencies 
have seen no evidence of ``pre-buy'' effects in response to the 
standards. In fact sales have been higher in recent years than they 
were before Phase 1. Moreover, manufacturers' compliance plans indicate 
intention to utilize the Phase 1 flexibilities, and we have yet to see 
significant non-compliance with the standards.
(5) Litigation on Phase 1 Rule
    The D.C. Circuit rejected all challenges to the agencies' Phase 1 
regulations. The court did not reach the merits of the challenges, 
holding that none of the petitioners had standing to bring their 
actions, and that a challenge to NHTSA's denial of a rulemaking 
petition could only be brought in District Court. See Delta 
Construction v. EPA, 783 F. 3d 1291 (D.C. Cir. 2015).

C. Summary of the Phase 2 Standards and Requirements

    The agencies are adopting new standards that build on and enhance 
existing Phase 1 standards, and are adopting as well the first-ever 
standards for certain trailers used in combination with heavy-duty 
tractors. Taken together, the Phase 2 program comprises a set of 
largely technology-advancing standards that will achieve greater GHG 
and fuel consumption savings than the Phase 1 program. As described in 
more detail in the following sections, the agencies are adopting these 
standards because, based on the information available at this time and 
careful consideration of all comments, we believe they best fulfill our 
respective statutory authorities when considered in the context of 
available technology, feasible reductions of emissions and fuel 
consumption, costs, lead time, safety, and other relevant factors.
    The Phase 2 standards represent a more technology-forcing \56\ 
approach than the Phase 1 approach, predicated on use of both off-the-
shelf technologies and emerging technologies that are not yet in 
widespread use. The agencies are adopting standards for MY 2027 that we 
project will require manufacturers to make extensive use of these 
technologies. The standards increase in stringency incrementally 
beginning in MY 2018 for trailers and in MY 2021 for other segments, 
ensuring steady improvement to the MY 2027 stringency levels. For 
existing technologies and technologies in the final stages of 
development, we project that manufacturers will likely apply them to 
nearly all vehicles, excluding those specific vehicles with 
applications or uses that prevent the technology from functioning 
properly. We also project as one possible compliance pathway that 
manufacturers could apply other more advanced technologies such as 
hybrids and waste engine heat recovery systems, although at lower 
application rates than the more conventional technologies. Comments on 
the overall stringency of the proposed Phase 2 program were mixed. Many 
commenters, including most non-governmental organizations, supported 
more stringent standards with less lead time. Many technology and 
component suppliers supported more stringent standards but with the 
proposed lead time. Vehicle manufacturers did not support more 
stringent standards and emphasized the importance of lead time. To the 
extent these commenters provided technical information to support their 
comments on stringency and lead time, it is discussed in Sections II 
through VI.
---------------------------------------------------------------------------

    \56\ In this context, the term ``technology-forcing'' has a 
specific legal meaning and is used to distinguish standards that 
will effectively require manufacturers to develop new technologies 
(or to significantly improve technologies) from standards that can 
be met using off-the-shelf technology alone. See, e.g., NRDC v. EPA, 
655 F. 2d 318, 328 (D.C. Cir. 1981). Technology-forcing standards do 
not require manufacturers to use any specific technologies. See also 
76 FR 57130 (explaing that section 202(a)(2) allows EPA to adopt 
such technology-forcing standards, although it does not compell such 
standards).
---------------------------------------------------------------------------

    The standards being adopted provide approximately ten years of lead 
time for manufacturers to meet these 2027 standards, which the agencies 
believe is appropriate to implement the technologies industry could use 
to meet these standards. For some of the more advanced technologies 
production prototype parts are not yet available, though they are in 
the research stage with some demonstrations in actual vehicles.\57\ In 
the respective sections of Chapter 2 of the RIA, the agencies explain 
what further steps are needed to successfully and reliably 
commercialize these prototypes in the lead time afforded by the Phase 2 
standards. Additionally, even for the more developed technologies, 
phasing in more stringent standards over a longer timeframe will help 
manufacturers to ensure better reliability of the technology and to 
develop packages to work in a wide range of applications.
---------------------------------------------------------------------------

    \57\ ``Prototype'' as it is used here refers to technologies 
that have a potentially production-feasible design that is expected 
to meet all performance, functional, reliability, safety, 
manufacturing, cost and other requirements and objectives that is 
being tested in laboratories and on highways under a full range of 
operating conditions, but is not yet available in production 
vehicles already for sale in the market.
---------------------------------------------------------------------------

    As discussed later, the agencies are also adopting new standards in 
MYs 2018 (trailers only), 2021, and 2024 to ensure that manufacturers 
make steady progress toward the 2027 standards, thereby achieving 
steady and feasible reductions in GHG emissions and fuel consumption in 
the years leading up to the MY 2027 standards.
    Providing additional lead time can often enable manufacturers to 
resolve technological challenges or to find lower cost means of meeting 
new regulatory standards, effectively making them more feasible in 
either case. See generally NRDC v. EPA, 655 F. 2d 318, 329 (D.C. Cir. 
1981). On the other hand, manufacturers and/or operators may incur 
additional costs if regulations require them to make changes to their 
products with less lead time than manufacturers would normally have 
when bringing a new technology to the market or expanding the 
application of existing technologies. After developing a new 
technology, manufacturers typically conduct extensive field tests to 
ensure its durability and reliability in actual use. Standards that 
accelerate technology deployment can lead to manufacturers incurring 
additional costs to accelerate this development work, or can lead to 
manufacturers beginning production before such testing can be 
completed. Some industry stakeholders have informed EPA that when 
manufacturers introduced new emission control technologies (primarily 
diesel particulate filters) in response to the 2007 heavy-duty engine 
standards they did not perform sufficient product development 
validation, which led to additional costs for operators when the 
technologies required repairs or resulted in other operational issues 
in use. Thus, the issues of costs, lead time, and reliability are 
intertwined for the

[[Page 73494]]

agencies' determination of whether standards are reasonable and maximum 
feasible, respectively.
    Another important consideration was the possibility of disrupting 
the market, which would be a risk if compliance required application of 
new technologies too suddenly. Several of the heavy-duty vehicle 
manufacturers, fleets, and commercial truck dealerships informed the 
agencies that for fleet purchases that are planned more than a year in 
advance, expectations of reduced reliability, increased operating 
costs, reduced residual value, or of large increases in purchase prices 
can lead the fleets to pull-ahead by several months planned future 
vehicle purchases by pre-buying vehicles without the newer technology. 
In the context of the Class 8 tractor market, where a relatively small 
number of large fleets typically purchase very large volumes of 
tractors, such actions by a small number of firms can result in large 
swings in sales volumes. Such market impacts would be followed by some 
period of reduced purchases that can lead to temporary layoffs at the 
factories producing the engines and vehicles, as well as at supplier 
factories, and disruptions at dealerships. Such market impacts also can 
reduce the overall environmental and fuel consumption benefits of the 
standards by delaying the rate at which the fleet turns over. See 
International Harvester v. EPA, 478 F. 2d 615, 634 (D.C. Cir. 1973). A 
number of commenters stated that the 2007 EPA heavy-duty engine 
criteria pollutant standard precipitated pre-buy for the Class 8 
tractor market.\58\ The agencies understand the potential impact that 
fleets pulling ahead purchases can have on American manufacturing and 
labor, dealerships, truck purchasers, and on the program's 
environmental and fuel savings goals, and have taken steps in the 
design of the program to avoid such disruption (see also our discussion 
in RTC Section 11.7). These steps include the following:
---------------------------------------------------------------------------

    \58\ For example, see the public comments of The International 
Union, Volvo Trucks North America, United Automobile, Aerospace and 
Agricultural Implement Workers of America (UAW).

 Providing considerable lead time
 Adopting standards that will result in significantly lower 
operating costs for vehicle owners (unlike the 2007 standard, which 
increased operating costs)
 Phasing in the standards
 Structuring the program so the industry will have a 
significant range of technology choices to be considered for 
compliance, rather than the one or two new technologies the OEMs 
pursued to comply with EPA's 2007 criteria pollutant standard
 Allowing manufacturers to use emissions averaging, banking and 
trading to phase in the technology even further

As discussed in the Phase 1 final rule, NHTSA has certain statutory 
considerations to take into account when determining feasibility of the 
preferred alternative.\59\ EISA states that NHTSA (in consultation with 
EPA and the Secretary of Energy) will develop a commercial medium- and 
heavy-duty fuel efficiency program designed ``to achieve the maximum 
feasible improvement.'' \60\ Although there is no definition of maximum 
feasible standards in EISA, NHTSA is directed to consider three factors 
when determining what the maximum feasible standards are. Those factors 
are, appropriateness, cost-effectiveness, and technological 
feasibility,\61\ which modify ``feasible'' beyond its plain meaning.
---------------------------------------------------------------------------

    \59\ 75 FR 57198.
    \60\ 49 U.S.C. 32902(k).
    \61\ Id.
---------------------------------------------------------------------------

    NHTSA has the broad discretion to weigh and balance the 
aforementioned factors in order to accomplish EISA's mandate of 
determining maximum feasible standards. The fact that the factors may 
often be at odds gives NHTSA significant discretion to decide what 
weight to give each of the competing factors, policies and concerns and 
then determine how to balance them--as long as NHTSA's balancing does 
not undermine the fundamental purpose of the EISA: Energy conservation, 
and as long as that balancing reasonably accommodates ``conflicting 
policies that were committed to the agency's care by the statute.'' 
\62\
---------------------------------------------------------------------------

    \62\ Center for Biological Diversity v. National Highway Traffic 
Safety Admin., 538 F.3d 1172, 1195 (9th Cir. 2008).
---------------------------------------------------------------------------

    EPA also has significant discretion in assessing, weighing, and 
balancing the relevant statutory criteria. Section 202(a)(2) of the 
Clean Air Act (42 U.S.C. 7521(a)(2)) requires that the standards ``take 
effect after such period as the Administrator finds necessary to permit 
the development and application of the requisite technology, giving 
appropriate consideration to the cost of compliance within such 
period.'' This language affords EPA considerable discretion in how to 
weight the critical statutory factors of emission reductions, cost, and 
lead time (76 FR 57129-57130). Section 202(a)(2) also allows (although 
it does not compel) EPA to adopt technology-forcing standards. Id. at 
57130.
    Sections II through VI of this Preamble explain the consideration 
that the agencies took into account based on careful assessment and 
balancing of the statutory factors under Clean Air Act section 
202(a)(1) and (2), and under 49 U.S.C. 32902(k).
(1) Carryover From Phase 1 Program and Compliance Changes
    Phase 2 is carrying over many of the compliance approaches 
developed for Phase 1, with certain changes as described below. Readers 
are referred to the regulatory text for much more detail. Note that the 
agencies have adapted some of these Phase 1 provisions in order to 
address new features of the Phase 2 program, notably provisions related 
to trailer compliance. The agencies have also reevaluated all of the 
compliance provisions to ensure that they will be effective in 
achieving the projected reductions without placing an undue burden on 
manufacturers.
    The agencies received significant comments from vehicle 
manufacturers emphasizing the potential for the structure of the 
compliance program to impact stringency. Although the agencies do not 
agree with all of these comments (which are discussed in more detail in 
later sections), we do agree that it is important to structure the 
compliance program so that the effective stringency of standards is 
consistent with levels established by regulation. The agencies have 
made appropriate improvements to the compliance structure in response 
to these comments.
(a) Certification
    EPA and NHTSA are applying the same general certification 
procedures for Phase 2 as are currently being used for certifying to 
the Phase 1 standards. Tractors and vocational vehicles will continue 
to be certified using the vehicle simulation tool (GEM). The agencies, 
however, revised the Phase 1 GEM simulation tool to develop a new 
version, Phase 2 GEM, that more specifically reflects improvements to 
engines, transmissions, and drivetrains.\63\ Rather than the GEM 
simulation tool using default values for engines, transmissions and 
drivetrains, most manufacturers will enter measured or tested values as 
inputs reflecting performance of the actual engine, transmission and 
drivetrain technologies.
---------------------------------------------------------------------------

    \63\ As described in Section IV, although the trailer standards 
were developed using the simulation tool, the agencies are adopting 
a compliance structure that does not require trailer manufacturers 
to use it.

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[[Page 73495]]

    The Phase 1 certification process for engines used in tractors and 
vocational vehicles was based on EPA's process for showing compliance 
with the heavy-duty engine criteria pollutant standards using engine 
dynamometer testing, and the agencies are continuing it for Phase 2. We 
also will continue certifying HD pickups and vans using the Phase 1 
chassis dynamometer testing results and vehicle certification process, 
which is very similar to the light-duty vehicle certification process. 
The Phase 2 trailer certification process will resemble the Phase 2 
tractor certification approach, but with a simplified version of Phase 
2 GEM. The trailer certification process allows trailer manufacturers 
to use a simple equation to determine GEM-equivalent g/ton-mile 
emission rates without actually running GEM.
    EPA and NHTSA are also clarifying provisions related to confirming 
a manufacturer's test data during certification (i.e., confirmatory 
testing) and verifying a manufacturer's vehicles are being produced to 
perform as described in the application for certification (i.e., 
selective enforcement audits or SEAs). The EPA confirmatory testing 
provisions for engines, vehicles, and components are in 40 CFR 1036.235 
and 1037.235. The SEA provisions are in 40 CFR 1036.301 and 1037.301-
1037.320. The NHTSA provisions are in 49 CFR 535.9(a). As we proposed, 
these clarifications will also apply for Phase 1 engines and vehicles.
    In response to comments, we are making several changes to the 
proposed EPA confirmatory testing provisions. First, the regulations 
being adopted specify that EPA will conduct triplicate tests for engine 
fuel maps to minimize the impact of test-to-test variability. The final 
regulations also state that we will consider entire fuel maps rather 
than individual points. Engine manufacturers objected to EPA's proposal 
that individual points could be replaced based on a single test, 
arguing that it effectively made the vehicle standards more stringent 
due to point-to-point and test-to-test variability. We believe that the 
changes being adopted largely address these concerns. We are also 
applying this approach for axle and transmission maps for similar 
reasons.
    As described in Sections III and IV, EPA has also modified the SEA 
regulations for verifying aerodynamic performance. These revised 
regulations differ somewhat from the standard SEA regulations to 
address the unique challenges of measuring aerodynamic drag. In 
particular EPA recognizes that for coastdown testing, test-to-test 
variability is expected to be large relative to production variability. 
This differs fundamentally from traditional compliance testing, in 
which test-to-test variability is expected to be small relative to 
production variability. To address this difference, the modified 
regulations call for more repeat testing of the same vehicle, but fewer 
test samples. These revisions were generally supported by commenters. 
See Section III and IV for additional discussion.
    Some commenters suggested that the agencies should apply a 
compliance margin to confirmatory and SEA test results to account for 
test variability. However, other commenters supported following EPA's 
past practice, which has been to base the standards on technology 
projections that assume manufacturers will apply compliance margins to 
their test results for certification. In other words, they design their 
products to have emissions below the standards by some small margin so 
that test-to-test or lab-to-lab variability would not cause them to 
exceed any applicable standards. Consequently, EPA has typically not 
set standards precisely at the lowest levels achievable, but rather at 
slightly higher levels--expecting manufacturers to target the lower 
levels to provide compliance margins for themselves. As discussed in 
Sections II through VI, the agencies have applied this approach to the 
Phase 2 standards.
(b) Averaging, Banking and Trading (ABT)
    The Phase 1 ABT provisions were patterned on established EPA ABT 
programs that have proven to work well. In Phase 1, the agencies 
determined this flexibility would provide an opportunity for 
manufacturers to make necessary technological improvements and reduce 
the overall cost of the program without compromising overall 
environmental and fuel economy objectives. Commenters generally 
supported this approach for engines, pickups/vans, tractors, and 
vocational vehicles. Thus, we are generally continuing this Phase 1 
approach with few revisions to the engine and vehicle segments. 
However, as described in Section IV, in response to comments, we are 
finalizing a much more limited averaging program for trailers that will 
not go into effect until 2027. We are adopting some other provisions 
for certain vocational vehicles, which are discussed in Section V.
    The agencies see the overall ABT program as playing an important 
role in making the technology-advancing standards feasible, by helping 
to address many issues of technological challenges in the context of 
lead time and costs. It provides manufacturers flexibilities that 
assist the efficient development and implementation of new technologies 
and therefore enable new technologies to be implemented at a more 
aggressive pace than without ABT.
    ABT programs are more than just add-on provisions included to help 
reduce costs. They can be, as in EPA's Title II programs generally, an 
integral part of the standard setting itself. A well-designed ABT 
program can also provide important environmental and energy security 
benefits by increasing the speed at which new technologies can be 
implemented (which means that more benefits accrue over time than with 
later-commencing standards) and at the same time increase flexibility 
for, and reduce costs to, the regulated industry and ultimately 
consumers. Without ABT provisions (and other related flexibilities), 
standards would typically have to be numerically less stringent since 
the numerical standard would have to be adjusted to accommodate issues 
of feasibility and available lead time. See 75 FR 25412-25413. By 
offering ABT credits and additional flexibilities the agencies can 
offer progressively more stringent standards that help meet our fuel 
consumption reduction and GHG emission goals at a faster and more cost-
effective pace.\64\
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    \64\ See NRDC v. Thomas, 805 F. 2d 410, 425 (D.C. Cir. 1986) 
(upholding averaging as a reasonable and permissible means of 
implementing a statutory provision requiring technology-forcing 
standards).
---------------------------------------------------------------------------

(i) Carryover of Phase 1 Credits and Credit Life
    The agencies proposed to continue the five-year credit life 
provisions from Phase 1, and not to adopt any general restriction on 
the use of banked Phase 1 credits in Phase 2. In other words, Phase 1 
credits in MY 2019 could be used in Phase 1 or in Phase 2 in MYs 2021-
2024. CARB commented in support of a more restrictive approach for 
Phase 1 credits, based on the potential for manufacturers to delay 
implementation of technology in Phase 2 by using credits generated 
under Phase 1. We also received comments asking the agencies to provide 
a path for manufacturers to generate credits for applying technologies 
not explicitly included in the Phase 1 program. In response to these 
comments, the agencies have analyzed the potential impacts of Phase 1 
credits on the Phase 2 program for each sector and made appropriate 
adjustments in the program. For example, as described in Section 
II.D.(5), the agencies are adopting some restrictions on the carryover 
of windfall Phase 1 engine credits that result from the Phase 1 
vocational engine standards.

[[Page 73496]]

Also, as described in Section III, the agencies are projecting that 
Phase 1 credit balances for tractor manufacturers will enable them to 
meet more stringent standards for MY 2021-2023, so the agencies have 
increased the stringency of these standards accordingly.
    In contrast to the Phase 1 tractor program, the Phase 1 vocational 
chassis program currently offers fewer opportunities to generate 
credits for potential carryover into Phase 2. To address comments 
related to this particular situation and also to provide a new Phase 1 
incentive to voluntarily apply certain Phase 2 technologies, which are 
available today but currently not being adopted, the agencies are 
finalizing a streamlined Phase 1 off-cycle credit approval process for 
these Phase 2 technologies. For vocational chassis, these technologies 
include workday idle reduction technologies such as engine stop-start 
systems, automatic engine shutdown systems, shift-to-neutral at idle 
automatic transmissions, automated manual transmissions, and dual-
clutch transmissions. The agencies are also finalizing a streamlined 
Phase 1 off-cycle credit approval process for Phase 2 automatic tire 
inflation systems (ATIS), for both tractors and vocational chassis. The 
purpose for offering these streamlined off-cycle approval processes for 
Phase 1 is to encourage more early adoption of these Phase 2 
technologies during the remaining portion of the Phase 1 program (e.g., 
model years 2018, 2019, 2020). Earlier adoption of these technologies 
would help demonstrate that these newer, but not advanced, technologies 
are effective, reliable and well-accepted into the marketplace by the 
time the agencies project that they would be needed for compliance with 
the Phase 2 standards.
    The agencies are also including a provision allowing exempt small 
business manufacturers of vocational chassis to opt into the Phase 1 
program for the purpose of generating credits which can be used 
throughout the Phase 2 program, as just described.
    In conjunction with this provision allowing manufacturers to 
receive credit in Phase 1 for pulling ahead certain Phase 2 
technologies, the agencies are providing an extended credit life for 
the Light and Medium heavy-duty vocational vehicle averaging sets (see 
next subsection) to provide additional Phase 2 transition flexibility 
for these vehicles. Unlike the HD Phase 1 pickup/van and tractor 
programs, where the averaging sets are broad; where manufacturers have 
many technology choices from which to earn credits (e.g., tractor 
aerodynamic and idle reduction technologies, pickup/van engine and 
transmission technologies); and where we project manufacturers to have 
sufficient pickup/van and tractor credits to manage the transition to 
the Phase 2 standards, transitioning to the new Light and Medium 
vocational vehicle standards may be more challenging. Manufacturers 
selling lower volumes of these lighter vehicles may find themselves 
with fewer overall credits to manage the transition to the new 
standards, especially the 2027 standards. To facilitate this transition 
and better assure adequate lead time, the agencies are extending the 
credit life for the Light and Medium heavy-duty vehicle averaging sets 
(typically vehicles in Classes 2b through 7) so that all credits 
generated in 2018 and later will last at least until 2027. We are not 
doing this for the Heavy heavy-duty vocational vehicle category 
(typically Class 8) because tractor credits may be used within this 
averaging set. Because we project that manufacturers will have 
sufficient tractor credits, we believe that they will be able to manage 
the Heavy vocational transition to each set of new standards, without 
the extended credit life that we are finalizing for Light and Medium 
vocational averaging sets. Nevertheless, we will continue to monitor 
the manufacturers' progress in transitioning to the Phase 2 standards 
for each category, and we may reconsider the need for additional 
transitional flexibilities, such as extending other categories' credit 
lives.
    Although, as we have already noted, the numerical values of Phase 2 
standards are not directly comparable in an absolute sense to the 
existing Phase 1 standards (in other words, a given vehicle would have 
a different g/ton-mile emission rate when evaluated using Phase 1 GEM 
than it would when evaluated using Phase 2 GEM), we believe that the 
Phase 1 and Phase 2 credits are largely equivalent. Because the 
standards and emission levels are included in a relative sense (as a 
difference), it is not necessary for the Phase 1 and Phase 2 standards 
to be directly equivalent in an absolute sense in order for the credits 
to be equivalent.
    This is best understood by examining the way in which credits are 
calculated. For example, the credit equations in 40 CFR 1037.705 and 49 
CFR 535.7 calculate credits as the product of the difference between 
the standard and the vehicle's emission level (g/ton-mile or gallon/
1,000 ton-mile), the regulatory payload (tons), production volume, and 
regulatory useful life (miles). The Phase 2 payloads, production 
volumes, and useful lives for tractors, medium and heavy heavy-duty 
engines, or medium and heavy heavy-duty vocational vehicles are 
equivalent to those of Phase 1. However, EPA is changing the regulatory 
useful lives of HD pickups and vans, light heavy-duty vocational 
vehicles, spark-ignited engines, and light heavy-duty compression-
ignition engines. Because useful life is a factor in determining the 
value of a credit, the agencies proposed to apply interim adjustment 
factors to ensure banked credits maintain their value in the transition 
from Phase 1 to Phase 2.
    For Phase 1, EPA aligned the useful life for GHG emissions with the 
useful life already in place for criteria pollutants. After the Phase 1 
rules were finalized, EPA updated the useful life for criteria 
pollutants as part of the Tier 3 rulemaking.\65\ The new useful life 
implemented for Tier 3 is 150,000 miles or 15 years, whichever occurs 
first. This same useful life is being adopted in Phase 2 for HD pickups 
and vans, light heavy-duty vocational vehicles, spark-ignited engines, 
and light heavy-duty compression-ignition engines.\66\ The numeric 
value of the adjustment factor for each of these regulatory categories 
depends on the Phase 1 useful life. These are described in detail below 
in this Preamble in Sections II, V, and VI. Without these adjustment 
factors the changes in useful life would effectively result in a 
discount of banked credits that are carried forward from Phase 1 to 
Phase 2, which is not the intent of the changes in the useful life. 
With the relatively flat deterioration generally associated with 
CO2, EPA does not believe the changes in useful life will 
significantly affect the feasibility of the Phase 2 standards.
---------------------------------------------------------------------------

    \65\ 79 FR 23492, April 28, 2014 and 40 CFR 86.1805-17.
    \66\ NHTSA's useful life is based on mileage and years of 
duration.
---------------------------------------------------------------------------

    We note that the primary purpose of allowing manufacturers to bank 
credits is to provide flexibility in managing transitions to new 
standards. The five-year credit life is substantial, and allows credits 
generated in either Phase 1 or early in Phase 2 to be used for the 
intended purpose. The agencies believe a credit life longer than five 
years is unnecessary to accomplish this transition. Restrictions on 
credit life serve to reduce the likelihood that any manufacturer will 
be able to use banked credits to disrupt the heavy-duty vehicle market 
in any given year by effectively limiting the amount of credits that 
can be held. Without this limit, one manufacturer that saved enough 
credits over many years could achieve a significant cost advantage by 
using all the credits in a single year. The agencies

[[Page 73497]]

believe that allowing a five-year credit life for all credits, and as a 
consequence allowing use of Phase 1 credits in Phase 2, creates 
appropriate flexibility and appropriately facilitates a smooth 
transition to each new level of standards.
(ii) Averaging Sets
    EPA has historically restricted averaging to some extent for its HD 
emission standards to avoid creating unfair competitive advantages or 
environmental risks due to credits being inconsistent. It also helps to 
ensure a robust and manageable compliance program. Under Phase 1, 
averaging, banking and trading can only occur within and between 
specified ``averaging sets'' (with the exception of credits generated 
through use of specified advanced technologies). As proposed, we will 
continue this regime in Phase 2, retaining the existing vehicle and 
engine averaging sets, and creating new trailer averaging sets. We are 
also continuing the averaging set restrictions from Phase 1 in Phase 2. 
(See Section V for certain other provisions applicable to vehicles 
certified to special standards.) These general averaging sets for 
vehicles are:

 Complete pickups and vans
 Other light heavy-duty vehicles (Classes 2b-5)
 Medium heavy-duty vehicles (Class 6-7)
 Heavy heavy-duty vehicles (Class 8)
 Long dry and refrigerated van trailers \67\
---------------------------------------------------------------------------

    \67\ Averaging for trailers does not begin until 2027.
---------------------------------------------------------------------------

 Short dry and refrigerated van trailers

We are not allowing trading between engines and chassis, even within 
the same vehicle class. Such trading would essentially result in double 
counting of emission credits, because the same engine technology would 
likely generate credits relative to both standards (and indeed, certain 
engine improvements are reflected exclusively in the vehicle standards 
the agencies are adopting). We similarly limit trading among engine 
categories to trades within the designated averaging sets:

 Spark-ignition engines
 Compression-ignition light heavy-duty engines
 Compression-ignition medium heavy-duty engines
 Compression-ignition heavy heavy-duty engines

The agencies continue to believe that maintaining trading to be only 
within the classes listed above will provide adequate opportunities for 
manufacturers to make necessary technological improvements and to 
reduce the overall cost of the program without compromising overall 
environmental and fuel efficiency objectives, and it is therefore 
appropriate and reasonable under EPA's authority and maximum feasible 
under NHTSA's authority, respectively. We do not expect emissions from 
engines and vehicles--when restricted by weight class--to be 
dissimilar. We therefore expect that the lifetime vehicle performance 
and emissions levels will be very similar across these defined 
categories, and the credit calculations will fairly ensure the expected 
fuel consumption and GHG emission reductions.
    These restrictions have generally worked well for Phase 1, and we 
continue to believe that these averaging sets create flexibility 
without creating an unfair advantage for manufacturers with integrated 
portfolios, including engines and vehicles. See 76 FR 57240.
(iii) Credit Deficits
    The Phase 1 regulations allow manufacturers to carry-forward 
deficits for up to three years. This is an important flexibility 
because the program is designed to address the diversity of the heavy-
duty industry by allowing manufacturers to sell a mix of engines or 
vehicles that have very different emission levels and fuel 
efficiencies. Under this construct, manufacturers can offset sales of 
engines or vehicles not meeting the standards by selling others (within 
the same averaging set) that perform better than the standards require. 
However, in any given year it is possible that the actual sales mix 
will not balance out, and the manufacturer may be short of credits for 
that model year. The three-year provision allows for this possibility 
and creates additional compliance flexibility to accommodate it.
(iv) Advanced Technology Credits
    At the time of the proposal, the agencies believed it was no longer 
appropriate to provide extra credit for any of the technologies 
identified as advanced technologies for Phase 1, although we requested 
comment on this issue. The Phase 1 advanced technology credits were 
adopted to promote the implementation of advanced technologies that 
were not included in our basis of the feasibility of the Phase 1 
standards. Such technologies included hybrid powertrains, Rankine cycle 
waste heat recovery systems on engines, all-electric vehicles, and fuel 
cell vehicles (see 40 CFR 86.1819-14(k)(7), 1036.150(h), and 
1037.150(p)). The Phase 2 heavy-duty engine and vehicle standards are 
premised on the use of some of these technologies, making them 
equivalent to other fuel-saving technologies in this context. We 
believe the Phase 2 standards themselves will provide sufficient 
incentive to develop those specific technologies.
    Although the agencies proposed to eliminate all advanced technology 
incentives, we remained open to targeted incentives that would address 
truly advanced technology. We specifically requested comment on this 
issue with respect to electric vehicle, plug-in hybrid, and fuel cell 
technologies. Although the Phase 2 standards are premised on some use 
of Rankine cycle waste heat recovery systems on engines and hybrid 
powertrains, none of these standards are based on projected utilization 
of these other even more-advanced technologies (e.g., all-electric 
vehicles, fuel cell vehicles). 80 FR 40158. Commenters generally 
supported providing credit multipliers for these advanced technologies. 
However, Allison supported ending the incentives for hybrids, fuel 
cells, and electric vehicles in Phase 2. ATA, on the other hand, 
commented that the agencies should preserve the advanced technology 
credits which provide a credit multiplier of 1.5 in order to promote 
the use of hybrid and electric vehicles in larger vocational vehicles 
and tractors. ARB supported the use of credit multipliers even more 
strongly and provided suggestions for values larger than 1.5 that could 
be used to incentivize plug-in hybrids, electric vehicles, and fuel 
cell vehicles. Eaton recommended the continuation of advanced 
technology credits for hybrid powertrains until a sufficient number are 
in the market. Overall, the comments indicated that there is support 
for such incentives among operators, suppliers, and states. Upon 
further consideration, the agencies are adopting advanced technology 
credits for these three types of advanced technologies, as shown in 
Table I-2 below.

               Table I-2--Advanced Technology Multipliers
------------------------------------------------------------------------
                         Technology                           Multiplier
------------------------------------------------------------------------
Plug-in hybrid electric vehicles...........................          3.5
All-electric vehicles......................................          4.5
Fuel cell vehicles.........................................          5.5
------------------------------------------------------------------------

    Our intention in adopting these multipliers is to create a 
meaningful incentive to those considering adopting these qualifying 
advanced technologies into their vehicles. The values being

[[Page 73498]]

adopted are consistent with values recommended by CARB in their 
supplemental comments.\68\ CARB's values were based on a cost analysis 
that compared the costs of these technologies to costs of other 
conventional technologies. Their costs analysis showed that adopting 
multipliers in this range would make these technologies much more 
competitive with the conventional technologies and could allow 
manufacturers to more easily generate a viable business case to develop 
these technologies for heavy-duty and bring them to market at a 
competitive price.
---------------------------------------------------------------------------

    \68\ Letter from Michael Carter, ARB, to Gina McCarthy, 
Administrator, EPA and Mark Rosekind, Administrator, NHTSA, June 16, 
2016.
---------------------------------------------------------------------------

    Another important consideration in the adoption of these larger 
multipliers is the tendency of the heavy-duty sector to significantly 
lag the light-duty sector in the adoption of advanced technologies. 
There are many possible reasons for this, such as:
     Heavy-duty vehicles are more expensive than light-duty 
vehicles, which makes it a greater monetary risk for purchasers to 
invest in unproven technologies.
     These vehicles are work vehicles, which makes predictable 
reliability even more important than for light-duty vehicles.
     Sales volumes are much lower for heavy-duty vehicles, 
especially for specialized vehicles.
    As a result of factors such as these, adoption rates for these 
advanced technologies in heavy-duty vehicles are essentially non-
existent today and seem unlikely to grow significantly within the next 
decade without additional incentives.
    The agencies believe it is appropriate to provide such large 
multipliers for these very advanced technologies at least in the short 
term, because they have the potential to provide very large reductions 
in GHG emissions and fuel consumption and advance technology 
development substantially in the long term. However, because they are 
so large, we also believe that we should not necessarily allow them to 
continue indefinitely. Therefore, the agencies are adopting them as an 
interim program that will continue through MY 2027. If the agencies 
determine that these credit multipliers should be continued beyond MY 
2027, we could do so in a future rulemaking.
    As discussed in Section I.C.(1)(d), the agencies are not 
specifically accounting for upstream emissions that might occur from 
production of electricity to power these advanced vehicles. This 
approach is largely consistent with the incentives offered for electric 
vehicles in the light-duty National Program. 77 FR 62810. For light-
duty vehicles, the agencies also did not require manufacturers to 
account for upstream emissions during the initial years, as the 
technologies are being developed. While we proactively sunset this 
allowance for light-duty due to concerns about potential impacts from 
very high sales volumes, we do not have similar concerns for heavy-
duty. Nevertheless, in this program we are only adopting these credit 
multipliers through MY 2027, and should we not promulgate a future 
rulemaking to extend them beyond MY 2027, these multipliers would 
essentially sunset in MY 2027.
    One feature of the Phase 1 advanced technology program that is not 
being continued in Phase 2 is the allowance to use advanced technology 
credits across averaging sets. We believe that combined with the very 
large multipliers being adopted, there could be too large a risk of 
market distortions if we allowed the use of these credits across 
averaging sets.
(v) Transition Flexibility for Meeting the Engine Standards
    Some manufacturers commented that the proposed engine regulations 
did not offer sufficient flexibility. Although these commenters 
acknowledge that the tractor and vocational vehicle standards will 
separately drive engine improvements, they nonetheless maintain that 
the MY 2024 engine standards may constrain potential compliance paths 
too much. Some commented that advanced technologies (such as waste heat 
recovery) may need to be deployed before the technologies are fully 
reliable for every engine manufacturer, and may lead to the development 
and implementation of additional engine technologies outside of 
scheduled engine redesign cycles, which could cause manufacturers to 
incur costs which were not accounted for in the agencies' analyses. 
These costs could include both product development and equipment costs 
for the engine manufacturer, and potential increased costs for vehicle 
owners associated with potential reliability issues in-the-field.
    The agencies have considered these comments carefully. See, e.g., 
RIA Section 2.3.9 and RTC Section 3.4. The agencies recognize the 
importance of ensuring that there is adequate lead time to develop, 
test, and otherwise assure reliability of the technologies projected to 
be needed to meet the standards and for the advanced engine 
technologies in particular. See Section I.C above; see also responses 
regarding waste heat recovery technology in RTC Section 3.4, and 
Response 3.4.1. The agencies are therefore adopting an alternative, 
optional ABT flexibility for heavy-heavy and medium-heavy engines in 
partial response to these comments. This optional provision would 
affect only the MYs 2021 and 2024 standards for these engines, not the 
final MY 2027 engine standards, and to the extent manufacturers elect 
the provision would increase fuel consumption and GHG reduction 
benefits, as explained below.
    This optional provision has three aspects:

 A pull ahead of the engine standards to MY 2020
 Extended credit life for engine credits generated against MYs 
2018-2019 Phase 1 standards, the MY 2020 pull-ahead Phase 2 engine 
standards, and the MYs 2021-2024 Phase 2 engine standards
 Slightly relaxed engine standards for MYs 2024-2026 tractor 
engine standards \69\
---------------------------------------------------------------------------

    \69\ Credits can be generated against these standards as well, 
but the life of credits generated for 2025 and 2026 would be five 
years. The pull ahead of the MY 2021 standards should more than 
balance out any slight decreases in benefits attributable to such 
credits.

    Thus, the final rule provides the option of an extended credit life 
for the medium heavy-duty and heavy heavy-duty engines so that all 
credits generated in MY 2018 and later will last at least until MY 
2030.\70\ To be eligible for this allowance, manufacturers would need 
to voluntarily certify all of their HHD and/or MHD MY 2020 engines 
(tractor and vocational) to MY 2021 standards.\71\ Manufacturers could 
elect to apply this provision separately to medium heavy-duty and heavy 
heavy-duty engines, since these remain separate averaging sets. Credits 
banked by the manufacturer in Phase 1 for model year 2018 and 2019 
engines would be eligible for the extended credit life for 
manufacturers satisfying the pull ahead requirement. Such credits could 
be used in any model year 2021 through

[[Page 73499]]

2030. Manufacturers that voluntarily certify their engines to MY 2021 
standards early would then also be eligible for slightly less stringent 
engine tractor standards in MYs 2024-2026, as shown in the following 
table.
---------------------------------------------------------------------------

    \70\ The final rule (40 CFR 1036.150(p)) provides that for 
engine manufacturers choosing this alternative option, credits 
generated with MY 2018-2024 engines can be used until MY 2030. 
Credits from later model years can be used for five years from 
generation under 40 CFR 1037.740(c).
    \71\ Compliance with this requirement would be evaluated at the 
time of certification and when end of year ABT reports are 
submitted. Manufacturers that show a net credit deficit for the 
averaging set at the end of the year would not meet this 
requirement.

             Table I-3--Optional ABT Flexibility Standards for Heavy-Heavy and Medium-Heavy Engines
----------------------------------------------------------------------------------------------------------------
                                                    Medium heavy-duty--tractor       Heavy heavy-duty--tractor
                                                 ---------------------------------------------------------------
                                                      EPA          NHTSA fuel         EPA          NHTSA fuel
                   Model years                     CO[ihel2]      consumption      CO[ihel2]      consumption
                                                  standard (g/  standard  (gal/   standard (g/  standard  (gal/
                                                    bhp-hr)        100bhp-hr)       bhp-hr)        100bhp-hr)
----------------------------------------------------------------------------------------------------------------
2020-2023.......................................          473             4.6464          447             4.3910
2024-2026.......................................          467             4.5874          442             4.3418
----------------------------------------------------------------------------------------------------------------

    Once having opted into this alternative compliance path, engine 
manufacturers would have to adhere to that path for the remainder of 
the Phase 2 program. The choice would be made when certifying MY 2020 
engines. Instead of certifying engines to the final year of the Phase 1 
engine standards, manufacturers electing the alternative would indicate 
that they are instead certifying to the MY 2021 Phase 2 engine 
standard.
    Because these engine manufacturers would be reducing emissions of 
engines otherwise subject to the MY 2020 Phase 1 engine standards (and 
because engine reductions were not reflected in the Phase 1 vehicle 
program), there would be a net benefit to the environment. These 
engines would not generate credits relative to the Phase 1 standards 
(that is, MY 2020 engines would only use or generate credits relative 
to the pulled ahead MY 2021 Phase 2 engines standards) which would 
result in net reductions of CO2 and fuel consumption of 
about 2 percent for each engine. Thus, if every engine manufacturer 
chooses to use this flexibility, there could be resulting reductions of 
an additional 12MMT of CO2 and saving of nearly one billion 
gallons of diesel fuel.
    This alternative also does not have adverse implications for the 
vehicle standards. As just noted, the vehicle standards themselves are 
unaffected. Thus, these voluntary standards would not reduce the GHG 
reductions or fuel savings of the program. Vehicle manufacturers using 
the alternative MYs 2024-2026 engines would need to adopt additional 
vehicle technology (i.e. technology beyond that projected to be needed 
to meet the standard) to meet the vehicle standards. This means the 
vehicles would still achieve the same fuel efficiency in use.\72\
---------------------------------------------------------------------------

    \72\ The agencies view this alternative as of reasonable cost 
with respect to the vehicle standards. First, where engine 
manufacturers and vehicle manufacturers are vertically integrated, 
that manufacturer would choose the alternative which is most cost 
advantageous. Second, where engine manufacturers and vehicle 
manufacturers are not vertically integrated, the agencies anticipate 
that engines certified to the alternative and the main standards 
will both be available for the vehicle manufacturer to purchase, so 
that the vehicle manufacturer would not need to incur any costs 
attributable to the alternative engine standard.
---------------------------------------------------------------------------

    In sum, the agencies view this alternative as being positive from 
the environmental and energy conservation perspectives, and believe it 
will provide significant flexibility for manufacturers that may reduce 
their compliance costs. It also provides a hedge against potential 
premature introduction of advanced engine technologies, providing more 
lead time to assure in-use reliability.
(c) Innovative Technology and Off-Cycle Credits
    The agencies are continuing the Phase 1 innovative technology 
program (reflecting certain streamlining features as just discussed), 
but re-designating it as an off-cycle program for Phase 2. In other 
words, beginning in MY 2021 technologies that are not accounted for in 
the GEM simulation tool, or by compliance dynamometer testing (for 
engines or chassis certified vehicles) will be considered ``off-
cycle,'' including those technologies that may no longer be considered 
innovative technologies.
    The final rules provide that in order for a manufacturer to receive 
these credits for Phase 2, the off-cycle technology will still need to 
meet the requirement that it was not in common use prior to MY 2010. 
Although we have not identified specific off-cycle technologies at this 
time that should be excluded, we believe it is prudent to continue this 
requirement to avoid the potential for manufacturers to receive 
windfall credits for technologies that they were already using before 
MY 2010, and that are therefore reflected in the Phase 2 (and possibly 
Phase 1) baselines. However, because the Phase 2 program will be 
implemented in MY 2021 and extend at least through MY 2027, the 
agencies and manufacturers may have difficulty in the future 
determining whether an off-cycle technology was in common use prior to 
MY 2010. In order to avoid this approach becoming an unnecessary 
hindrance to the off-cycle program, the agencies will presume that off-
cycle technologies were not in common use in 2010 unless we have clear 
evidence to the contrary. Neither the agencies nor manufacturers will 
be required to demonstrate that the technology meets this 2010 
criteria. Rather, the agencies will simply retain the authority to deny 
a request for off-cycle credits if it is clear that the technology was 
in common use in 2010 and thus part of the baseline.
    Manufacturers will be able to carry over innovative technology 
credits from Phase 1 into Phase 2, subject to the same restrictions as 
other credits. Manufacturers will also be able to carry over the 
improvement factor (not the credit value) of a technology, if certain 
criteria are met. The agencies will require documentation for all off-
cycle requests similar to those required by EPA for its light-duty GHG 
program.
    Additionally, the agencies will not grant any off-cycle credits for 
crash avoidance technologies. The agencies will also require 
manufacturers to consider the safety of off-cycle technologies and will 
request a safety assessment from the manufacturer for all off-cycle 
technologies.
    Similar principles apply to off-cycle credits in this heavy-duty 
Phase 2 program as under the light-duty vehicle rules. Thus, 
technologies which are part of the basis of a Phase 2 standard would 
not be eligible for off-cycle credits. Their benefits have been 
accounted for in developing the stringency of the Phase 2 standard, as 
have their costs. See 77 FR 62835 (October 15, 2012). In addition, 
technologies which are integral or inherent to the basic vehicle design 
and are recognized in GEM or under the FTP (for pickups and vans), 
including engine, transmission, mass reduction, passive aerodynamic 
design, and base tires, will not be eligible for off-cycle credits. 77 
FR 62836.

[[Page 73500]]

Technologies integral or inherent to basic vehicle design are fully 
functioning and are thus recognized in GEM, or operate over the 
entirety of the FTP/HFET and therefore are adequately captured by the 
test procedure.
    Just as some technologies that were considered off-cycle for Phase 
1 are being adopted as primary technologies in Phase 2 on whose 
performance standard stringency is calculated, the agencies may revise 
the regulation in a future rulemaking to create a more direct path to 
recognize technologies currently considered off-cycle. For example, 
although we are including specific provisions to recognize certain 
electrified accessories, recognizing others would require the 
manufacturer to go through the off-cycle process. However, it is quite 
possible that the agencies could gather sufficient data to allow us to 
adopt specific provisions in a future rulemaking to recognize other 
accessories in a simpler manner. Because such a change would merely 
represent a simpler way to receive the same credit as could be obtained 
under the regulations being adopted today (rather than a change in 
stringency), it would not require us to reconsider the standards.
(d) Alternative Fuels and Electric Vehicles
    The agencies will largely continue the Phase 1 approach for engines 
and vehicles fueled by fuels other than gasoline and diesel.\73\ Phase 
1 engine emission standards applied uniquely for gasoline-fueled and 
diesel-fueled engines. The regulations in 40 CFR part 86 implement 
these distinctions for alternative fuels by dividing engines into Otto-
cycle and Diesel-cycle technologies based on the combustion cycle of 
the engine. However, as proposed, the agencies are making a small 
change that is described in Section II. Under this change, we will 
require manufacturers to divide their natural gas engines into primary 
intended service classes, like the current requirement for compression-
ignition engines. Any alternative fuel-engine qualifying as a heavy 
heavy-duty engine will be subject to all the emission standards and 
other requirements that apply to compression-ignition engines. Note 
that this small change in approach will also apply with respect to 
EPA's criteria pollutant program.
---------------------------------------------------------------------------

    \73\ See Section XI for additional discussion of natural gas 
engines and vehicles.
---------------------------------------------------------------------------

    We are also applying the Phase 2 standards at the vehicle tailpipe. 
That is, compliance is based on vehicle fuel consumption and GHG 
emission reductions, and does not reflect any so-called lifecycle 
emission properties. The agencies have explained why it is reasonable 
that the heavy-duty standards be fuel neutral in this manner and adhere 
to this reasoning here. See 76 FR 57123; see also 77 FR 51705 (August 
24, 2012) and 77 FR 51500 (August 27, 2012). In particular, EPA notes 
that there is a separate, statutorily-mandated program under the Clean 
Air Act which encourages use of renewable fuels in transportation 
fuels, including renewable fuel used in heavy-duty diesel engines. This 
program considers lifecycle greenhouse gas emissions compared to 
petroleum fuel. NHTSA notes that the fuel efficiency standards are 
necessarily tailpipe-based, and that a lifecycle approach would likely 
render it impossible to harmonize the fuel efficiency and GHG emission 
standards, to the great detriment of our goal of achieving a 
coordinated program. 77 FR 51500-51501; see also 77 FR 51705 (similar 
finding by EPA); see also Section I.F.(1)(a) below, Section 1.8 of the 
RTC, and Section XI.B.
    The agencies received mixed comments on this issue. Many commenters 
supported the proposed approach, generally agreeing with the agencies' 
arguments. However, some other commenters opposed this approach. 
Opposing commenters generally fell into two categories:
     Commenters concerned that upstream emissions of methane 
occurring during the production and distribution of natural gas would 
offset some or all of the GHG emission reductions observed at the 
tailpipe.
     Commenters concerned that tailpipe-only standards ignore 
the GHG benefits of using renewable fuels.
    The agencies are not issuing rules that effectively would turn 
these rules into a fuel program, rather than an emissions reduction and 
fuel efficiency program. Nor will the agencies disharmonize the program 
by having GHG standards reflect upstream emissions having no relation 
to fuel efficiency. See e.g. 77 FR 51500-51501; see also 77 FR 51705. 
We thus will continue to measure compliance at the tailpipe. Issues 
relating to whether to consider in the emission standards upstream 
emissions related to natural gas exploration and production are 
addressed in detail in Section XI below. It is sufficient to state here 
that the agencies carefully investigated the potential use of natural 
gas in the heavy-duty sector and the impacts of such use. We do not 
believe that the use of natural gas is likely to become a major fuel 
source for heavy-duty vehicles during the Phase 2 time frame. Thus, 
since we project natural gas vehicles to have little impact on both 
overall GHG emissions and fuel consumption during the Phase 2 time 
frame, the agencies see no need to make fundamental changes to the 
Phase 1 approach for natural gas engines and vehicles.
    The agencies note further that a consequence of the tailpipe-based 
approach is that the agencies will treat vehicles powered by 
electricity the same as in Phase 1. In Phase 1, EPA treated all 
electric vehicles as having zero tailpipe emissions of CO2, 
CH4, and N2O (see 40 CFR 1037.150(f)). Similarly, 
NHTSA adopted regulations in Phase 1 that set the fuel consumption 
standards based on the fuel consumed by the vehicle. The agencies also 
did not require emission testing for electric vehicles in Phase 1. The 
agencies considered the potential unintended consequence of not 
accounting for upstream emissions from the charging of heavy-duty 
electric vehicles. In our reassessment for Phase 2, we have found only 
one all-electric heavy-duty vehicle manufacturer that has certified 
through 2016. As we look to the future, we project limited adoption of 
all-electric vehicles into the market. Therefore, we believe that this 
provision is still appropriate. Unlike the 2017-2025 light-duty rule, 
which included a cap whereby upstream emissions would be counted after 
a certain volume of sales (see 77 FR 62816-62822), we believe there is 
no need to establish a cap for heavy-duty vehicles because of the small 
likelihood of significant production of EV technologies in the Phase 2 
timeframe. Commenters specifically addressing electric vehicles 
generally supported the agencies' proposal. However, some commenters 
did support accounting for emissions from the generation of electricity 
in the broader context of supporting full life-cycle analysis. As noted 
above, and in more detail in Section I.F.(2)(f) as well as Section 1.8 
of the RTC, the agencies are not predicating the standards on a full 
life-cycle approach.
(e) Phase 1 Interim Provisions
    EPA adopted several flexibilities for the Phase 1 program (40 CFR 
86.1819-14(k), 1036.150 and 1037.150) as interim provisions. Because 
the existing regulations do not have an end date for Phase 1, most of 
these provisions did not have an explicit end date. NHTSA adopted 
similar provisions. With few exceptions, the agencies are not 
continuing these provisions for Phase 2. These will generally remain in 
effect for the Phase 1 program. In particular, the agencies note that 
we are not continuing the blanket exemption for small

[[Page 73501]]

manufacturers. Instead, in Phase 2 the agencies are providing more 
targeted relief for these entities.
(f) In-Use Standards and Recall
    Section 202(a)(1) of the CAA specifies that EPA is to adopt 
emissions standards that are applicable for the useful life of the 
vehicle and for the engine. EPA finalized in-use standards for the 
Phase 1 program, whereas NHTSA's rules do not include these standards. 
For the Phase 2 program, EPA will carry-over its in-use provisions, and 
NHTSA is adopting EPA's useful life requirements for its vehicle and 
engine fuel consumption standards to ensure manufacturers consider in 
the design process the need for fuel efficiency standards to apply for 
the same duration and mileage as EPA standards. If EPA determines a 
manufacturer fails to meet its in-use standards, civil penalties may be 
assessed.
    CAA section 207(c)(1) requires ``the manufacturer'' to remedy 
certain in-use problems. The remedy process is to recall the 
nonconforming vehicles and bring them into conformity with the 
standards and the certificate. The regulations for this process are in 
40 CFR part 1068, subpart F. EPA is also adopting regulatory text 
addressing recall obligations for component manufacturers and other 
non-certifying manufacturers. We note that the CAA does not limit this 
responsibility to certificate holders, consistent with the definition 
of a ``manufacturer'' as ``any person engaged in the manufacturing or 
assembling of new motor vehicles, new motor vehicle engines, new 
nonroad vehicles or new nonroad engines, or importing such vehicles or 
engines for resale, or who acts for and is under the control of any 
such person in connection with the distribution of new motor vehicles, 
new motor vehicle engines, new nonroad vehicles or new nonroad engines, 
but shall not include any dealer with respect to new motor vehicles, 
new motor vehicle engines, new nonroad vehicles or new nonroad engines 
received by him in commerce.''
    As discussed in Section I.E.(1) below, this definition was not 
intended to restrict the definition of ``manufacturer'' to a single 
person per vehicle. Under EPA regulations, we can require any person 
meeting the definition of manufacturer for a nonconforming vehicle to 
participate in a recall. However, we would normally presume the 
certificate holder to have the primary responsibility.
    EPA requested comment on adding regulatory text that would 
explicitly apply these provisions to tire manufacturers. Comments from 
the tire industry generally opposed this noting that they are not the 
manufacturer of the vehicle. These comments are correct that tires are 
not incomplete vehicles and hence that the recall authority does not 
apply for companies that only manufacture the tires. However, EPA 
remains of the view that in the event that vehicles (e.g. trailers) do 
not conform to the standards in-use due to nonconforming tires, tire 
manufacturers would have a role to play in remedying the problem. In 
this (hypothetical) situation, a tire manufacturer would not only have 
produced the part in question, but in the case of a trailer 
manufacturer or other small vehicle manufacturer, would have 
significantly more resources and knowledge regarding how to address 
(and redress) the problem. Accordingly, EPA would likely require that a 
component manufacturer responsible for the nonconformity assist in the 
recall to an extent and in a manner consistent with the provisions of 
CAA section 208(a). This section specifies that component and part 
manufacturers ``shall establish and maintain records, perform tests 
where such testing is not otherwise reasonably available under this 
part and part C of this subchapter (including fees for testing), make 
reports and provide information the Administrator may reasonably 
require to determine whether the manufacturer or other person has acted 
or is acting in compliance with this part and part C of this subchapter 
and regulations thereunder, or to otherwise carry out the provision of 
this part and part C of this subchapter. . .''. Any such action would 
be considered on a case-by-case basis, adapted to the particular 
circumstances at the time.
(g) Vehicle Labeling
    EPA proposed to largely continue the Phase 1 engine and vehicle 
labeling requirements, but to eliminate the requirement for tractor and 
vocational vehicle manufacturers to list emission control on the label. 
The agencies consider it crucial that authorized compliance inspectors 
are able to identify whether a vehicle is certified, and if so whether 
it is in its certified condition. To facilitate this identification in 
Phase 1, EPA adopted labeling provisions for tractors that included 
several items. The Phase 1 tractor label must include the manufacturer, 
vehicle identifier such as the Vehicle Identification Number (VIN), 
vehicle family, regulatory subcategory, date of manufacture, compliance 
statements, and emission control system identifiers (see 40 CFR 
1037.135). EPA proposed to apply parallel requirements for trailers.
    In Phase 1, the emission control system identifiers are limited to 
vehicle speed limiters, idle reduction technology, tire rolling 
resistance, some aerodynamic components, and other innovative and 
advanced technologies. However, the number of emission control systems 
for greenhouse gas emissions in Phase 2 has increased significantly for 
tractors and vocational vehicles. For example, all aspects of the 
engine transmission and drive axle; accessories; tire radius and 
rolling resistance; wind averaged drag; predictive cruise control; idle 
reduction technologies; and automatic tire inflation systems are 
controls which can be evaluated on-cycle in Phase 2 (i.e. these 
technologies' performance can now be input to GEM), but could not be in 
Phase 1. Due to the complexity in determining greenhouse gas emissions 
in Phase 2, the agencies do not believe that we can unambiguously 
determine whether or not a vehicle is in a certified condition through 
simply comparing information that could be made available on an 
emission control label with the components installed on a vehicle. 
Therefore, EPA proposed to remove the requirement to include the 
emission control system identifiers required in 40 CFR 1037.135(c)(6) 
and in Appendix III to 40 CFR part 1037 from the emission control 
labels for vehicles certified to the Phase 2 standards. The agencies 
received comments on the emission control labels from Navistar, which 
supported the elimination of the emission control information from the 
vehicle GHG label.
    Although we are largely finalizing the proposed labeling 
requirements, we remain interested in finding a better approach for 
labeling. Under the agencies' existing authorities, manufacturers must 
provide detailed build information for a specific vehicle upon our 
request. Our expectation is that this information should be available 
to us via email or other similar electronic communication on a same-day 
basis, or within 24 hours of a request at the latest. The agencies have 
started to explore ideas that would provide inspectors with an 
electronic method to identify vehicles and access on-line databases 
that would list all of the engine-specific and vehicle-specific 
emissions control system information. We believe that electronic and 
Internet technology exists today for using scan tools to read a bar 
code or radio frequency identification tag affixed to a vehicle that 
could then lead to secure on-line access to a database of 
manufacturers' detailed vehicle and

[[Page 73502]]

engine build information. Our exploratory work on these ideas has 
raised questions about the level of effort that would be required to 
develop, implement and maintain an information technology system to 
provide inspectors real-time access to this information. We have also 
considered questions about privacy and data security. We requested 
comment on the concept of electronic labels and database access, 
including any available information on similar systems that exist today 
and on burden estimates and approaches that could address concerns 
about privacy and data security.
    Although we are not finalizing such a program in this rulemaking, 
we remain very interested in the use of electronic labels that could be 
used by the agencies to access vehicle information and may pursue these 
in a future rulemaking. Such a rulemaking would likely consider the 
feasibility of accessing dynamic link libraries in real-time to view 
each manufacturer's build records (and perhaps pending orders). The 
agencies envision that this could be very useful for our inspectors by 
providing them access to the build information by VIN to confirm that 
each vehicle has the proper emission control features.
(h) Model Year Definition
    The agencies proposed to continue the Phase definitions of ``model 
year'' for compliance with GHG emissions and fuel efficiency standards. 
However, in response to comments, the agencies are revising the 
definition slightly for Phase 2 tractors and vocational vehicles to 
match the model years of the engines installed in them. The revised 
definition generally sets the vehicle model year to be the calendar 
year of manufacture, but allows the vehicle manufacturer the option to 
select the prior year if the vehicle uses an engine manufactured in the 
prior model year.\74\ Because Phase 2 vehicle standards are based in 
part on engine performance, some commenters stated that the engine 
model year should dictate the vehicle's GHG and fuel efficiency 
compliance model year, and that the emissions and fuel efficiency 
compliance model year should be presented on the vehicle emissions 
label. This would allow manufacturers to market a vehicle and certify 
it to NHTSA's safety standards based on the standards applicable on the 
date of manufacture, but certify the vehicle for GHG emissions and fuel 
efficiency purposes based on the engine model compliance year. For 
example, a 2023 model year tractor might have a 2022 model year engine 
in it. The tractor would be marketed as a model year 2023 tractor, 
certified as complying with NHTSA's safety standards applicable at the 
time when certifying the vehicle, but would have an ``emissions and 
fuel efficiency compliance model year'' of 2022 for purposes of 
emissions and fuel efficiency standards. In today's action, NHTSA and 
EPA are finalizing standards that allow for the use of an ``emissions 
and fuel efficiency compliance model year.'' This is consistent with 
past program practice, in which certain manufacturers have been able to 
reclassify tractors to the previous model year for emissions purposes 
when the tractors use engines from the previous model year.
---------------------------------------------------------------------------

    \74\ Anti-stockpiling provisions will generally prevent vehicle 
manufacturers from using new engines older than the prior model 
year. See Section XIII.B for a discussion of EPA requirements for 
installing older used engines into new vehicles.
---------------------------------------------------------------------------

(2) Phase 2 Standards
    This section briefly summarizes the Phase 2 standards for each 
category and identifies the technologies that the agencies project will 
be needed to meet the standards. Given the large number of different 
regulatory categories and model years for these standards, the actual 
numerical standards are not listed. Readers are referred to Sections II 
through IV for the tables of standards.
(a) Summary of the Engine Standards
    The agencies are continuing the basic Phase 1 structure for the 
Phase 2 engine standards. There will be separate standards and test 
cycles for tractor engines, vocational diesel engines, and vocational 
gasoline engines. However, as described in Section II, we are adopting 
a revised test cycle for tractor engines to better reflect actual in-
use operation. After consideration of comments, including those 
specifically addressing whether the agencies should adopt an 
alternative with accelerated stringency targets, the agencies are 
adopting engine standards that can generally be characterized as more 
stringent than the proposed alternative.
    Specifically, for diesel tractor engines, the agencies are adopting 
standards for MY 2027 that are more stringent than the preferred 
alternative from the proposal, and require reductions in CO2 
emissions and fuel consumption that are 5.1 percent better than the 
2017 baseline for tractor engines.\75\ We are also adopting standards 
for MY 2021 and MY 2024, requiring reductions in CO2 
emissions and fuel consumption of 1.8 to 4.2 percent better than the 
2017 baseline tractor engines. For vocational diesel engines, the new 
standards will require reductions of 2.3, 3.6, and 4.2 percent in MYs 
2021, 2024, and 2027, respectively. These levels are more stringent 
than the proposed standards for these same MYs, and approximately as 
stringent in MY 2021 and MY 2024 as the Alternative 4 standards 
discussed at proposal.\76\
---------------------------------------------------------------------------

    \75\ For the flat baseline referenec case, the agencies project 
that tractors engines will meet the Phase 1 engine standards with a 
small compliancee margin. The Phase 1 standards for diesel engines 
will be fully phased-in by MY 2017, so we use MY 2017 as the 
baseline engine for tractors. Note that we project that vocational 
engines will achieve additioanl overcompliance with the Phase 1 
vocational engine standards.
    \76\ As noted in Section II, the numerical levels of the 
vocational engine standards also reflect an updated baseline in 
which Phase 1 vocational engines are more efficient than assumed for 
the proposal. In addition, the numerical levels of the tractor 
engine standards reflect an updated baseline to reflect the changes 
to the test cycle.
---------------------------------------------------------------------------

    The agencies project that these reductions will be maximum feasible 
and reasonable for diesel engines based on technological changes that 
will improve combustion and reduce energy losses. For most of these 
improvements, the agencies project (i.e., the agencies have set out a 
potential, but by no means mandatory, compliance path) that 
manufacturers will begin applying improvements to about 45 percent of 
their heavy-duty engines by 2021, and ultimately apply them to about 95 
percent of their heavy-duty engines by 2024. However, for some of these 
improvements we project more limited application rates. In particular, 
we project a more limited use of waste exhaust heat recovery systems in 
2027, projecting that about 10 percent of tractor engines will have 
turbo-compounding systems, and an additional 25 percent of tractor 
engines will employ Rankine-cycle waste heat recovery. We do not 
project that turbo-compounding or Rankine-cycle waste heat recovery 
technology will be utilized in vocational engines due to vocational 
vehicle drive cycles under which these technologies would not show 
significant benefit, and also due to low sales volumes, limiting the 
ability to invest in newer technologies for these vehicles.
    As described in Section III.D.(1)(b)(i), the agencies project that 
some engine manufacturers will be able to achieve larger reductions for 
at least some of their tractor engines. So in developing the tractor 
vehicle standards, we projected slightly better fuel efficiency for the 
average tractor engine than is required by the engine standards. We are 
projecting that similar over-compliance will occur for heavy heavy-duty 
vocational engines.
    For gasoline vocational engines, we are not adopting more stringent 
engine standards. Gasoline engines used in

[[Page 73503]]

vocational vehicles are generally the same engines as are used in the 
complete HD pickups and vans in the Class 2b and 3 weight categories, 
although the operational demands of vocational vehicles often require 
use of the largest, most powerful SI engines, so that some engines 
fitted in complete pickups and vans are not appropriate for use in 
vocational vehicles. Given the relatively small sales volumes for 
gasoline-fueled vocational vehicles, manufacturers typically cannot 
afford to invest significantly in developing separate technology for 
these vocational vehicle engines. Thus, we project that in general, 
vocational gasoline engines will incorporate much of the technology 
that will be used to meet the pickup and van chassis standards, and 
this will result in some real world reductions in CO2 
emissions and fuel consumption. The agencies received many comments 
suggesting that technologies be applied to increase the stringency of 
the SI engine standard, which technologies in fact are already presumed 
to be adopted at 100 percent to meet the MY 2016 engine standard. The 
commenters did not identify any additional engine technologies that are 
not already fully considered by the agencies in setting the MY 2016 
engine standard, that could be recognized over the HD SI Engine FTP 
test cycle. We did, however, consider some additional technologies 
recommended by commenters, which can be recognized over the GEM vehicle 
cycles. As a result, the Phase 2 vehicle standards for gasoline-fueled 
vocational vehicles are predicated on adoption of engine technologies 
beyond what is required to meet the separate engine standard, those 
additional technologies being advanced engine friction reduction and 
cylinder deactivation. As described in Section V, we are projecting 
these technologies to improve fuel consumption over the GEM cycles by 
nearly one percent in MY 2021, MY 2024, and MY 2027. In other words, 
this improvement is reflected in the vehicle standards rather than in 
the engine standards. To the extent any SI engines do not incorporate 
the projected engine technologies, manufacturers of gasoline-fueled 
vocational vehicles would need to achieve equivalent reductions from 
some other technology to meet the GEM-based vehicle standards. The 
engine standards are summarized in Table I-4.

  Table I-4--Summary of Phase 1 and Phase 2 Requirements for Engines in
              Combination Tractors and Vocational Vehicles
------------------------------------------------------------------------
                                 Phase 1 program    Final 2027 standards
------------------------------------------------------------------------
Covered in this category....  Engines installed in tractors and
                               vocational chassis.
------------------------------------------------------------------------
Share of HDV fuel             Combination tractors and vocational
 consumption and GHG           vehicles account for approximately 85
 emissions.                    percent of fuel use and GHG emissions in
                               the heavy duty truck sector.
------------------------------------------------------------------------
Per vehicle fuel consumption  5%-9% improvement     4%-5% improvement
 and CO[ihel2] improvement.    over MY 2010          over MY 2017 for
                               baseline, depending   diesel engines.
                               vehicle               Note that
                               application.          improvements are
                               Improvements are in   captured in
                               addition to           complete vehicle
                               improvements from     tractor and
                               tractor and           vocational vehicle
                               vocational vehicle    standards, so that
                               standards.            engine improvements
                                                     and the vehicle
                                                     improvement shown
                                                     below are not
                                                     additive.
------------------------------------------------------------------------
Form of the standard........  EPA: CO[ihel2] grams/horsepower-hour and
                               NHTSA: Gallons of fuel/horsepower-hour.
------------------------------------------------------------------------
Example technology options    Combustion, air       Further technology
 available to help             handling, friction    improvements and
 manufacturers meet            and emissions after-  increased use of
 standards.                    treatment             all Phase 1
                               technology            technologies, plus
                               improvements.         waste heat recovery
                                                     systems for tractor
                                                     engines (e.g.,
                                                     turbo-compound and
                                                     Rankine-cycle).
------------------------------------------------------------------------
Flexibilities...............  ABT program which     Same ABT and off-
                               allows emissions      cycle program as
                               and fuel              Phase 1.
                               consumption credits  Adjustment factor of
                               to be averaged,       1.36 for credits
                               banked, or traded     carried forward
                               (five year credit     from Phase 1 to
                               life).                Phase 2 for SI and
                               Manufacturers         LHD CI engines due
                               allowed to carry-     to change in useful
                               forward credit        life.
                               deficits for up to   Revised multipliers
                               three model years.    for Phase 2
                               Interim incentives    advanced
                               for advanced          technologies.
                               technologies,        No Phase 2 early
                               recognition of        credit multipliers.
                               innovative (off-
                               cycle) technologies
                               not accounted for
                               by the HD Phase 1
                               test procedures,
                               and credits for
                               certifying early.
------------------------------------------------------------------------

(b) Summary of the Tractor Standards
    As explained in Section III, the agencies will largely continue the 
structure of the Phase 1 tractor program, but adopt new standards and 
update test procedures, as summarized in Table I-6. The tractor 
standards for MY 2027 will achieve up to 25 percent lower 
CO2 emissions and fuel consumption than a 2017 model year 
Phase 1 tractor. The agencies project that the 2027 tractor standards 
could be met through improvements in the:

 Engine \77\ (including some use of waste heat recovery 
systems)
---------------------------------------------------------------------------

    \77\ Although the agencies are adopting new engine standards 
with separate engine certification, engine improvements will also be 
reflected in the vehicle certification process. Thus, it is 
appropriate to also consider engine improvements in the context of 
the vehicle standards.
---------------------------------------------------------------------------

 Transmission
 Driveline
 Aerodynamic design
 Tire rolling resistance
 Idle performance
 Other accessories of the tractor.

    The agencies have enhanced the Phase 2 GEM vehicle simulation tool 
to recognize these technologies, as described in Section II.C. The 
agencies' evaluation shows that some of these technologies are 
available today, but have very low adoption rates on current vehicles, 
while others will require some lead time for development and 
deployment. In addition to the proposed alternative for tractors, the 
agencies solicited comment on an alternative that reached similar 
ultimate stringencies, but at an accelerated pace.
    We have also determined that there is sufficient lead time to 
introduce many of these tractor and engine technologies into the fleet 
at a reasonable cost starting in the 2021 model year. The

[[Page 73504]]

2021 model year standards for combination tractors and engines will 
achieve up to 14 percent lower CO2 emissions and fuel 
consumption than a 2017 model year Phase 1 tractor, the 2024 model year 
standards will achieve up to 20 percent lower CO2 emissions 
and fuel consumption, and as already noted, the 2027 model year 
standards will achieve up to 25 percent lower CO2 emissions 
and fuel consumption.
    In addition to the CO2 emission standards for tractors, 
EPA is adopting new particulate matter (PM) standards which effectively 
limit which diesel fueled auxiliary power units (APUs) can be used as 
emission control devices to reduce main engine idling in tractors, as 
shown in Table I-5. Additional details are discussed in Section 
III.C.3.

             Table I-5--PM Standards Related to Diesel APUs
------------------------------------------------------------------------
                                      PM emission
            Tractor MY             standard  (g/kW-    Expected control
                                          hr)             technology
------------------------------------------------------------------------
2018-2023........................              0.15  In-cylinder PM
                                                      control.
2024.............................              0.02  DPF.
------------------------------------------------------------------------


 Table I-6--Summary of Phase 1 and Phase 2 Requirements for Class 7 and
                      Class 8 Combination Tractors
------------------------------------------------------------------------
                                 Phase 1 program    Final 2027 standards
------------------------------------------------------------------------
Covered in this category....  Tractors that are designed to pull
                               trailers and move freight.
------------------------------------------------------------------------
Share of HDV fuel             Combination tractors and their engines
 consumption and GHG           account for approximately sixty percent
 emissions.                    of fuel use and GHG emissions in the
                               heavy duty vehicle sector.
------------------------------------------------------------------------
Per vehicle fuel consumption  10%-23% improvement   19%-25% improvement
 and CO[ihel2] improvement.    over MY 2010          over tractors
                               baseline, depending   meeting the MY 2017
                               on tractor            standards.
                               category.
                               Improvements are in
                               addition to
                               improvements from
                               engine standards.
------------------------------------------------------------------------
Form of the standard........  EPA: CO[ihel2] grams/ton payload mile and
                               NHTSA: Gallons of fuel/1,000 ton payload
                               mile.
------------------------------------------------------------------------
Example technology options    Aerodynamic drag      Further technology
 available to help             improvements; low     improvements and
 manufacturers meet            rolling resistance    increased use of
 standards.                    tires; high           all Phase 1
                               strength steel and    technologies, plus
                               aluminum weight       engine
                               reduction; extended   improvements,
                               idle reduction; and   improved
                               speed limiters.       transmissions and
                                                     axles, tire
                                                     pressure systems,
                                                     and predictive
                                                     cruise control
                                                     (depending on
                                                     tractor type).
------------------------------------------------------------------------
Flexibilities...............  ABT program which     Same ABT and off-
                               allows emissions      cycle program as
                               and fuel              Phase 1.
                               consumption credits  Revised multipliers
                               to be averaged,       for Phase 2
                               banked, or traded     advanced
                               (five year credit     technologies.
                               life).
                               Manufacturers
                               allowed to carry-
                               forward credit
                               deficits for up to
                               three model years.
                               Interim incentives
                               for advanced
                               technologies,
                               recognition of
                               innovative (off-
                               cycle) technologies
                               not accounted for
                               by the HD Phase 1
                               test procedures,
                               and credits for
                               certifying early.
------------------------------------------------------------------------

(c) Summary of the Trailer Standards
    The final rules contain a set of GHG emission and fuel consumption 
standards for manufacturers of new trailers that are used in 
combination with tractors. These standards will significantly reduce 
CO2 and fuel consumption from combination tractor-trailers 
nationwide over a period of several years. As described in Section IV, 
there are numerous aerodynamic and tire technologies available to 
manufacturers to achieve these standards. Many of these technologies 
have already been introduced into the market through EPA's voluntary 
SmartWay program and California's tractor-trailer greenhouse gas 
requirements.
    The agencies are adopting Phase 2 standards that will phase-in 
beginning in MY 2018 and be fully phased-in by 2027. These standards 
are predicated on use of aerodynamic and tire improvements, with 
trailer OEMs making incrementally greater improvements in MYs 2021 and 
2024 as standard stringency increases in each of those model years. 
EPA's GHG emission standards will be mandatory beginning in MY 2018, 
while NHTSA's fuel consumption standards will be voluntary beginning in 
MY 2018, and be mandatory beginning in MY 2021. In general, the trailer 
standards being finalized apply only for box vans, flatbeds, tankers, 
and container chassis.
    As described in Section XIV.D and Chapter 12 of the RIA, the 
agencies are adopting special provisions to minimize the impacts on 
small business trailer manufacturers. These provisions have been 
informed by and are largely consistent with recommendations from the 
SBAR Panel that EPA conducted pursuant to section 609(b) of the 
Regulatory Flexibility Act (RFA). Broadly, these provisions provide 
additional lead time for small business manufacturers, as well as 
simplified testing and compliance requirements. The agencies also are 
not finalizing standards for various trailer types, including most 
specialty types of non-box trailers. Excluding these specialty trailers 
also reduces the impacts on small businesses.

[[Page 73505]]



         Table I-7--Summary of Phase 2 Requirements for Trailers
------------------------------------------------------------------------
                                 Phase 1 program    Final 2027 standards
------------------------------------------------------------------------
Covered in this category......  All lengths of dry vans, refrigerated
                                 vans, tanks, flatbeds, and container
                                 chassis hauled by low, mid, and high
                                 roof day and sleeper cab tractors.
------------------------------------------------------------------------
Share of HDV fuel consumption   Trailers are modeled together with
 and GHG emissions.              combination tractors and their engines.
                                 Together, they account for
                                 approximately sixty percent of fuel use
                                 and GHG emissions in the heavy duty
                                 truck sector.
------------------------------------------------------------------------
Per vehicle fuel consumption    N/A..............  Between 3% and 9%
 and CO[ihel2] improvement.                         improvement over MY
                                                    2018 baseline,
                                                    depending on the
                                                    trailer type.
------------------------------------------------------------------------
Form of the standard..........  N/A..............  EPA: CO[ihel2] grams/
                                                    ton payload mile and
                                                    NHTSA: Gallons/1,000
                                                    ton payload mile.
------------------------------------------------------------------------
Example technology options      N/A..............  Low rolling
 available to help                                  resistance tires and
 manufacturers meet standards.                      tire pressure
                                                    systems for most
                                                    trailers, plus
                                                    weight reduction and
                                                    aerodynamic
                                                    improvements such as
                                                    side and rear
                                                    fairings, gap
                                                    closing devices, and
                                                    undercarriage
                                                    treatment for box
                                                    vans (e.g., dry and
                                                    refrigerated).
------------------------------------------------------------------------
Flexibilities.................  N/A..............  One year delay in
                                                    implementation for
                                                    small businesses,
                                                    trailer
                                                    manufacturers may
                                                    use pre-approved
                                                    aerodynamic data in
                                                    lieu of additional
                                                    testing, averaging
                                                    program available in
                                                    MY 2027 for
                                                    manufacturers of dry
                                                    and refrigerated box
                                                    vans.
------------------------------------------------------------------------

(d) Summary of the Vocational Vehicle Standards
    As explained in Section V, the agencies are adopting new vocational 
vehicle standards that expand upon the Phase 1 Program. These new 
standards reflect further subcategorization from Phase 1, with separate 
standards based on mode of operation: Urban, regional, and multi-
purpose. The agencies are also adopting optional separate standards for 
emergency vehicles and other custom chassis vehicles.
    The agencies project that the vocational vehicle standards could be 
met through improvements in the engine, transmission, driveline, lower 
rolling resistance tires, workday idle reduction technologies, weight 
reduction, and some application of hybrid technology. These are 
described in Section V of this Preamble and in Chapter 2.9 of the RIA. 
These MY 2027 standards will achieve up to 24 percent lower 
CO2 emissions and fuel consumption than MY 2017 Phase 1 
standards. The agencies are also making revisions to the compliance 
program for vocational vehicles. These include: The addition of two 
idle cycles that will be weighted along with the other drive cycles for 
each vocational vehicle; and revisions to Phase 2 GEM to recognize 
improvements to the engine, transmission, and driveline.
    Similar to the tractor program, we have determined that there is 
sufficient lead time to introduce many of these new technologies into 
the fleet starting in MY 2021. Therefore, we are adopting new standards 
for MY 2021 and 2024. Based on our analysis, the MY 2021 standards for 
vocational vehicles will achieve up to 12 percent lower CO2 
emissions and fuel consumption than a MY 2017 Phase 1 vehicle, on 
average, and the MY 2024 standards will achieve up to 20 percent lower 
CO2 emissions and fuel consumption.
    In Phase 1, EPA adopted air conditioning (A/C) refrigerant leakage 
standards for tractors, as well as for heavy-duty pickups and vans, but 
not for vocational vehicles. For Phase 2, EPA believes that it will be 
feasible to apply similar A/C refrigerant leakage standards for 
vocational vehicles, beginning with the 2021 model year. The 
certification process for vocational vehicles to certify low-leakage A/
C components is identical to that already required for tractors.

  Table I-8--Summary of Phase 1 and Phase 2 Requirements for Vocational
                             Vehicle Chassis
------------------------------------------------------------------------
                                 Phase 1 program     Final 2027 standard
------------------------------------------------------------------------
Covered in this category....  Class 2b--8 chassis that are intended for
                               vocational services such as delivery
                               vehicles, emergency vehicles, dump truck,
                               tow trucks, cement mixer, refuse trucks,
                               etc., except those qualified as off-
                               highway vehicles.
                              Because of sector diversity, vocational
                               vehicle chassis are segmented into Light,
                               Medium and Heavy Heavy-Duty vehicle
                               categories and for Phase 2 each of these
                               segments are further subdivided using
                               three duty cycles: Regional, Multi-
                               purpose, and Urban.
------------------------------------------------------------------------
Share of HDV fuel             Vocational vehicles account for
 consumption and GHG           approximately 17 percent of fuel use and
 emissions.                    GHG emissions in the heavy duty truck
                               sector categories.
------------------------------------------------------------------------
Per vehicle fuel consumption  2% improvement over   Up to 24%
 and CO[ihel2] improvement.    MY 2010 baseline.     improvement over MY
                               Improvements are in   2017 standards.
                               addition to
                               improvements from
                               engine standards.
------------------------------------------------------------------------
Form of the standard........  EPA: CO[ihel2] grams/ton payload mile and
                               NHTSA: Gallons of fuel/1,000 ton payload
                               mile.
------------------------------------------------------------------------
Example technology options    Low rolling           Further technology
 available to help             resistance tires.     improvements and
 manufacturers meet                                  increased use of
 standards.                                          Phase 1
                                                     technologies, plus
                                                     improved engines,
                                                     transmissions and
                                                     axles, weight
                                                     reduction, hybrids,
                                                     and workday idle
                                                     reduction systems.
------------------------------------------------------------------------

[[Page 73506]]

 
Flexibilities...............  ABT program which     Same ABT and off-
                               allows emissions      cycle program as
                               and fuel              Phase 1. Adjustment
                               consumption credits   factor of 1.36 for
                               to be averaged,       credits carried
                               banked, or traded     forward from Phase
                               (five year credit     1 to Phase 2 due to
                               life).                change in useful
                               Manufacturers         life.
                               allowed to carry-    Revised multipliers
                               forward credit        for Phase 2
                               deficits for up to    advanced
                               three model years.    technologies.
                               Interim incentives   No Phase 2 early
                               for advanced          credit multipliers.
                               technologies,        Chassis intended for
                               recognition of        emergency vehicles,
                               innovative (off-      cement mixers,
                               cycle) technologies   coach buses, school
                               not accounted for     buses, transit
                               by the HD Phase 1     buses, refuse
                               test procedures,      trucks, and motor
                               and credits for       homes may
                               certifying early.     optionally use
                                                     application-
                                                     specific Phase 2
                                                     standards using a
                                                     simplified version
                                                     of GEM.
------------------------------------------------------------------------

(e) Summary of the Heavy-Duty Pickup and Van Standards
    The agencies are adopting new Phase 2 GHG emission and fuel 
consumption standards for heavy-duty pickups and vans that will be 
applied in largely the same manner as the Phase 1 standards. These 
standards are based on the extensive use of most known and proven 
technologies, and could result in some use of mild or strong hybrid 
powertrain technology. These standards will commence in MY 2021. By 
2027, these standards are projected to be 16 percent more stringent 
than the 2018-2019 standards.

  Table I-9--Summary of Phase 1 and Phase 2 Requirements for HD Pickups
                                and Vans
------------------------------------------------------------------------
                                 Phase 1 program     Final 2027 standard
------------------------------------------------------------------------
Covered in this category....  Class 2b and 3 complete pickup trucks and
                               vans, including all work vans and 15-
                               passenger vans but excluding 12-passenger
                               vans which are subject to light-duty
                               standards.
------------------------------------------------------------------------
Share of HDV fuel             HD pickups and vans account for
 consumption and GHG           approximately 23% of fuel use and GHG
 emissions.                    emissions in the heavy duty truck sector.
------------------------------------------------------------------------
Per vehicle fuel consumption  15% improvement over  16% improvement over
 and CO[ihel2] improvement.    MY 2010 baseline      MY 2018-2019
                               for diesel            standards.
                               vehicles, and 10%
                               improvement for
                               gasoline vehicles.
------------------------------------------------------------------------
Form of the standard........  Phase 1 standards are based upon a ``work
                               factor'' attribute that combines truck
                               payload and towing capabilities, with an
                               added adjustment for 4-wheel drive
                               vehicles. There are separate target
                               curves for diesel-powered and gasoline-
                               powered vehicles. The Phase 2 standards
                               are based on the same approach.
------------------------------------------------------------------------
Example technology options    Engine improvements,  Further technology
 available to help             transmission          improvements and
 manufacturers meet            improvements,         increased use of
 standards.                    aerodynamic drag      all Phase 1
                               improvements, low     technologies, plus
                               rolling resistance    engine stop-start,
                               tires, weight         and powertrain
                               reduction, and        hybridization (mild
                               improved              and strong).
                               accessories.
------------------------------------------------------------------------
Flexibilities...............  Two optional phase-   Same as Phase 1,
                               in schedules; ABT     with phase-in
                               program which         schedule based on
                               allows emissions      year-over-year
                               and fuel              increase in
                               consumption credits   stringency. Same
                               to be averaged,       ABT and off-cycle
                               banked, or traded     program as Phase 1.
                               (five year credit     Adjustment factor
                               life).                of 1.25 for credits
                               Manufacturers         carried forward
                               allowed to carry-     from Phase 1 to
                               forward credit        Phase 2 due to
                               deficits for up to    change in useful
                               three model years.    life.
                               Interim incentives   Revised multipliers
                               for advanced          for Phase 2
                               technologies,         advanced
                               recognition of        technologies.
                               innovative (off-     No Phase 2 early
                               cycle) technologies   credit multipliers.
                               not accounted for
                               by the HD Phase 1
                               test procedures,
                               and credits for
                               certifying early.
------------------------------------------------------------------------

    Similar to Phase 1, the agencies are adopting for Phase 2 a set of 
continuous equation-based standards for HD pickups and vans. Please 
refer to Section VI for a description of these standards, including 
associated tables and figures.

D. Summary of the Costs and Benefits of the Final Rules

    This section summarizes the projected costs and benefits of the 
NHTSA fuel consumption and EPA GHG emission standards. See Sections VII 
through IX and the RIA for additional details about these projections.
    For these rules, the agencies used two analytical methods for the 
heavy-duty pickup and van segment by employing both DOT's CAFE model 
and EPA's MOVES model. The agencies used EPA's MOVES model to estimate 
fuel consumption and emissions impacts for tractor-trailers (including 
the engine that powers the tractor), and vocational vehicles (including 
the engine that powers the vehicle). Additional calculations were 
performed to determine corresponding monetized program costs and 
benefits. For heavy-duty pickups and vans, the agencies performed 
separate analyses, which we refer to as ``Method A'' and ``Method B.'' 
In Method A, a new version of the CAFE model was used to project a 
pathway the industry could use to comply with each regulatory 
alternative and the estimated effects on fuel consumption, emissions, 
benefits and costs. In Method B, the CAFE model from the NPRM was used 
to project a pathway the industry could use to comply with each 
regulatory alternative, along with resultant impacts on per-vehicle 
costs. However, the MOVES model was used to calculate corresponding 
changes in total fuel consumption and annual emissions for pickups and 
vans in Method B. Additional calculations were performed to determine 
corresponding

[[Page 73507]]

monetized program costs and benefits. NHTSA considered Method A as its 
central analysis and Method B as a supplemental analysis. EPA 
considered the results of Method B. The agencies concluded that these 
methods led the agencies to the same conclusions and the same selection 
of these standards. See Section VII for additional discussion of these 
two methods.
(1) Reference Case Against Which Costs and Benefits Are Calculated
    The No Action Alternatives for today's analysis, alternatively 
referred to as the ``baselines'' or ``reference cases,'' assume that 
the agencies did not issue new rules regarding MD/HD fuel efficiency 
and GHG emissions. These are the baselines against which costs and 
benefits for these standards are calculated. The reference cases assume 
that model year 2018 engine, tractor, vocational vehicle, and HD pickup 
and van standards will be extended indefinitely and without change. 
They also assume that no new standards would be adopted for trailers.
    The agencies recognize that if these Phase 2 standards had not been 
adopted, manufacturers would nevertheless continue to introduce new 
heavy-duty vehicles in a competitive market that responds to a range of 
factors, and manufacturers might have continued to improve technologies 
to reduce heavy-duty vehicle fuel consumption. Thus, as described in 
Section VII, both agencies fully analyzed these standards and the 
regulatory alternatives against two reference cases. The first case 
uses a baseline that projects no improvement in new vehicles in the 
absence of new Phase 2 standards, and the second uses a more dynamic 
baseline that projects some significant improvements in vehicle fuel 
efficiency. NHTSA considered its primary analysis to be based on the 
dynamic baseline, where certain cost-effective technologies are assumed 
to be applied by manufacturers to improve fuel efficiency beyond the 
Phase 1 requirements in the absence of new Phase 2 standards. EPA 
considered both reference cases. The results for all of the regulatory 
alternatives relative to both reference cases, derived via the same 
methodologies discussed in this section, are presented in Section X of 
the Preamble.
    The agencies received limited comments on these reference cases. 
Some commenters expressed support for a flat baseline in the context of 
the need for the regulations, arguing that little improvement would 
occur without the regulations. Others supported the less dynamic 
baseline because they believe it more fully captures the costs. A 
number of commenters expressed that purchasers are willing to and do 
pay for fuel efficiency improving technologies, provided the cost for 
the technology is paid back through fuel savings within a certain 
period of time; this is the premise for a dynamic baseline. Some 
commenters thought it reasonable that the agencies consider both 
baselines given the uncertainty in this area. No commenters opposed the 
consideration of both baselines.
    The agencies have continued to analyze two different baselines for 
the final rules because we recognize that there are a number of factors 
that create uncertainty in projecting a baseline against which to 
compare the future effects of this action and the remaining 
alternatives. The composition of the future fleet--such as the relative 
position of individual manufacturers and the mix of products they each 
offer--cannot be predicted with certainty at this time. Additionally, 
the heavy-duty vehicle market is diverse, as is the range of vehicle 
purchasers. Heavy-duty vehicle manufacturers have reported that their 
customers' purchasing decisions are influenced by their customers' own 
determinations of minimum total cost of ownership, which can be unique 
to a particular customer's circumstances. For example, some customers 
(e.g., less-than-truckload or package delivery operators) operate their 
vehicles within a limited geographic region and typically own their own 
vehicle maintenance and repair centers within that region. These 
operators tend to own their vehicles for long time periods, sometimes 
for the entire service life of the vehicle. Their total cost of 
ownership is influenced by their ability to better control their own 
maintenance costs, and thus they can afford to consider fuel efficiency 
technologies that have longer payback periods, outside of the vehicle 
manufacturer's warranty period. Other customers (e.g., truckload or 
long-haul operators) tend to operate cross-country, and thus must 
depend upon truck dealer service centers for repair and maintenance. 
Some of these customers tend to own their vehicles for about four to 
seven years, so that they typically do not have to pay for repair and 
maintenance costs outside of either the manufacturer's warranty period 
or some other extended warranty period. Many of these customers tend to 
require seeing evidence of fuel efficiency technology payback periods 
on the order of 18 to 24 months before seriously considering evaluating 
a new technology for potential adoption within their fleet (NAS 2010, 
Roeth et al. 2013, and Klemick et al. 2014). Purchasers of HD pickups 
and vans wanting better fuel efficiency tend to demand that fuel 
consumption improvements pay back within approximately one to three 
years, but some HD pickup and van owners accrue relatively few vehicle 
miles traveled per year, such that they may be less likely to adopt new 
fuel efficiency technologies, while other owners who use their 
vehicle(s) with greater intensity may be even more willing to pay for 
fuel efficiency improvements. Regardless of the type of customer, their 
determination of minimum total cost of ownership involves the customer 
balancing their own unique circumstances with a heavy-duty vehicle's 
initial purchase price, availability of credit and lease options, 
expectations of vehicle reliability, resale value and fuel efficiency 
technology payback periods. The degree of the incentive to adopt 
additional fuel efficiency technologies also depends on customer 
expectations of future fuel prices, which directly impacts customer 
payback periods. Purchasing decisions are not based exclusively on 
payback period, but also include the considerations discussed above and 
in Section X.A.1. For the baseline analysis, the agencies use payback 
period as a proxy for all of these considerations, and therefore the 
payback period for the baseline analysis is shorter than the payback 
period industry uses as a threshold for the further consideration of a 
technology. See Section X.A.1 of this Preamble and Chapter 11 of the 
RIA for a more detailed discussion of baselines. As part of a 
sensitivity analysis, additional baseline scenarios were also evaluated 
for HD pickups and vans, including baseline payback periods of 12, 18 
and 24 months. See Section VI of this Preamble and Chapter 10 of the 
RIA for a detailed discussion of these additional scenarios.
(2) Costs and Benefits Projected for the Phase 2 Standards
    The tables below summarize the benefits and costs for the program 
in two ways: First, from the perspective of a program designed to 
improve the Nation's energy security and to conserve energy by 
improving fuel efficiency and then from the perspective of a program 
designed to reduce GHG emissions. The individual categories of benefits 
and costs presented in the tables below are defined more fully and 
presented in more detail in Chapter 8 of the RIA.
    Lifetime fuel savings, GHG reductions, benefits, costs and net 
benefits for model years 2018 through

[[Page 73508]]

2029 vehicles as presented below. This is consistent with the NPRM 
analysis and allows readers to compare the costs and benefits of the 
final program with those projected for the NPRM. It also includes for 
modeling purposes at least three model years for each standard.
    Table I-10 shows benefits and costs for these standards from the 
perspective of a program designed to improve the Nation's energy 
security and conserve energy by improving fuel efficiency. From this 
viewpoint, technology costs occur when the vehicle is purchased. Fuel 
savings are counted as benefits that occur over the lifetimes of the 
vehicles produced during the model years subject to the Phase 2 
standards as they consume less fuel.

 Table I-10--Lifetime Fuel Savings, GHG Reductions, Benefits, Costs, and
 Net Benefits for Model Years 2018-2029 Vehicles Using Analysis Method A
                       [Billions of 2013$] \a\ \b\
------------------------------------------------------------------------
            Category               3% discount rate    7% discount rate
------------------------------------------------------------------------
Fuel Reductions (Billion
 Gallons).......................                 71.1-77.7
                                 ---------------------------------------
GHG reductions (MMT CO[ihel2]
 eq)............................                 959-1049
                                 ---------------------------------------
Vehicle Program: Technology and         23.7 to 24.4        16.1 to 16.6
 Indirect Costs, Normal Profit
 on Additional Investments......
Additional Routine Maintenance..          1.7 to 1.7          0.9 to 0.9
Congestion, Crashes, Fatalities           3.1 to 3.2          1.8 to 1.9
 and Noise from Increased
 Vehicle Use \d\................
                                 ---------------------------------------
    Total Costs.................        28.5 to 29.3        18.8 to 19.4
                                 ---------------------------------------
Fuel Savings (valued at pre-tax       149.1 to 163.0        79.7 to 87.0
 prices)........................
Savings from Less Frequent                3.0 to 3.2          1.6 to 1.7
 Refueling......................
Economic Benefits from                    5.4 to 5.5          3.4 to 3.5
 Additional Vehicle Use.........
                                 ---------------------------------------
Reduced Climate Damages from GHG
 Emissions \c\..................               33.0 to 36.0
                                 ---------------------------------------
Reduced Health Damages from Non-        27.1 to 30.0        14.6 to 16.1
 GHG Emissions..................
Increased U.S. Energy Security..          7.3 to 7.9          3.9 to 4.2
                                 ---------------------------------------
    Total Benefits..............          225 to 246          136 to 149
                                 ---------------------------------------
    Net Benefits................          197 to 216          117 to 129
------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.
\b\ Range reflects two reference case assumptions 1a and 1b.
\c\ Benefits and net benefits use the 3 percent global average SCC value
  applied only to CO[ihel2] emissions; GHG reductions include CO[ihel2],
  CH4, N[ihel2]O and HFC reductions, and include benefits to other
  nations as well as the U.S. See Draft RIA Chapter 8.5 and Preamble
  Section IX.G for further discussion.
\d\ ``Congestion, Crashes, Fatalities and Noise from Increased Vehicle
  Use'' includes NHTSA's monetized value of estimated reductions in the
  incidence of highway fatalities associated with mass reduction in HD
  pickup and vans, but this does not include these reductions from
  tractor-trailers or vocational vehicles. This likely results in a
  conservative overestimate of these costs.

    Table I-11 shows benefits and cost from the perspective of reducing 
GHG. As shown below in terms of MY lifetime GHG reductions, and in RIA 
Chapter 5 in terms of year-by-year GHG reductions, the final program is 
expected to reduce more GHGs over the long run than the proposed 
program. In general, the greater reductions can be attributed to 
increased market penetration and effectiveness of key technologies, 
based on new data and comments, leading to increases in stringency such 
as with the diesel engine standards (Section I.C.(2)(a) above).

 Table I-11--Lifetime Fuel Savings, GHG Reductions, Benefits, Costs and
 Net Benefits for Model Years 2018-2029 Vehicles Using Analysis Method B
                       [Billions of 2012$] \a\ \b\
------------------------------------------------------------------------
            Category               3% discount rate    7% discount rate
------------------------------------------------------------------------
Fuel Reductions (Billion
 Gallons).......................                   73-82
                                 ---------------------------------------
GHG reductions (MMT CO[ihel2]eq)                 976-1,098
                                 ---------------------------------------
Vehicle Program (e.g.,              -$26.5 to -$26.2    -$17.6 to -$17.4
 technology and indirect costs,
 normal profit on additional
 investments)...................
Additional Routine Maintenance..      -$1.9 to -$1.9      -$1.0 to -$1.0
Fuel Savings (valued at pre-tax     $149.3 to $169.1      $76.8 to $87.2
 prices)........................
Energy Security.................        $6.9 to $7.8        $3.5 to $4.0
Congestion, Crashes, and Noise        -$3.2 to -$3.2      -$1.8 to -$1.8
 from Increased Vehicle Use.....
Savings from Less Frequent              $3.4 to $4.0        $1.8 to $2.1
 Refueling......................
Economic Benefits from                $10.4 to $10.5        $5.7 to $5.7
 Additional Vehicle Use.........
Benefits from Reduced Non-GHG         $28.3 to $31.9      $13.4 to $15.0
 Emissions \c\..................
------------------------------------------------------------------------

[[Page 73509]]

 
Reduced Climate Damages from GHG
 Emissions \d\..................              $33.0 to $37.2
                                 ---------------------------------------
    Net Benefits................        $200 to $229        $114 to $131
------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.
\b\ Range reflects two baseline assumptions 1a and 1b.
\c\ Range reflects both the two baseline assumptions 1a and 1b using the
  mid-point of the low and high $/ton estimates for calculating
  benefits.
\d\ Benefits and net benefits use the 3 percent average directly modeled
  SC-GHG values applied to direct reductions of CO[ihel2], CH[ihel4] and
  N[ihel2]O emissions; GHG reductions include CO[ihel2], CH[ihel4] and
  N[ihel2]O reductions.

    Table I-12 breaks down by vehicle category the benefits and costs 
for these standards using the Method A analytical approach. For 
additional detail on per-vehicle break-downs of costs and benefits, 
please see RIA Chapter 10.

 Table I-12--Per Vehicle Category Lifetime Fuel Savings, GHG Reductions,
   Benefits, Costs and Net Benefits for Model Years 2018-2029 Vehicles
Using Analysis Method A (Billions of 2013$), Relative to Baseline 1b \a\
------------------------------------------------------------------------
    Key costs and benefits by
        vehicle category           3% discount rate    7% discount rate
------------------------------------------------------------------------
                Tractors, Including Engines, and Trailers
------------------------------------------------------------------------
Fuel Reductions (Billion
 Gallons).......................                    50
                                 ---------------------------------------
GHG Reductions (MMT CO[ihel2]
 eq)............................                    685
                                 ---------------------------------------
Total Costs.....................                13.8                 9.0
Total Benefits..................               161.0                96.8
Net Benefits....................               147.2                85.5
------------------------------------------------------------------------
                 Vocational Vehicles, Including Engines
------------------------------------------------------------------------
Fuel Reductions (Billion
 Gallons).......................                    12
                                 ---------------------------------------
GHG Reductions (MMT CO[ihel2]
 eq)............................                    162
                                 ---------------------------------------
Total Costs.....................                 7.3                 4.8
Total Benefits..................                37.8                22.7
Net Benefits....................                30.5                15.3
------------------------------------------------------------------------
                           HD Pickups and Vans
------------------------------------------------------------------------
Fuel Reductions (Billion
 Gallons).......................                    10
                                 ---------------------------------------
GHG Reductions (MMT CO[ihel2]
 eq)............................                    111
                                 ---------------------------------------
Total Costs.....................                 7.4                 5.1
Total Benefits..................                26.0                16.7
Net Benefits....................                18.6                11.6
------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.


                 Table I-13--Per Vehicle Costs, Using Method A (2013$), Relative to Baseline 1b
----------------------------------------------------------------------------------------------------------------
                                                                      MY 2021         MY 2024         MY 2027
----------------------------------------------------------------------------------------------------------------
Per Vehicle Cost ($): \a\
    Tractors....................................................          $6,400          $9,920         $12,160
    Trailers....................................................             850           1,000           1,070
    Vocational Vehicles.........................................           1,110           2,020           2,660
    Pickups/Vans................................................             750             760           1,340
----------------------------------------------------------------------------------------------------------------
Note:
\a\ Per vehicle costs include new engine and vehicle technology only; costs associated with increased insurance,
  taxes and maintenance are included in the payback period values.


[[Page 73510]]


                      Table I-14--Per Vehicle Costs Using Method B Relative to Baseline 1a
----------------------------------------------------------------------------------------------------------------
                                                                      MY 2021         MY 2024         MY 2027
----------------------------------------------------------------------------------------------------------------
Per Vehicle Cost ($): \a\
    Tractors....................................................          $6,484         $10,101         $12,442
    Trailers....................................................             868           1,033           1,108
    Vocational Vehicles.........................................           1,110           2,022           2,662
    Pickups/Vans................................................             524             963           1,364
----------------------------------------------------------------------------------------------------------------
Note:
\a\ Per vehicle costs include new engine and vehicle technology only; costs associated with increased insurance,
  taxes and maintenance are included in the payback period values.

    An important metric to vehicle purchasers is the payback period 
that can be expected on any new purchase. In other words, there is 
greater willingness to pay for new technology if that new technology 
``pays back'' within an acceptable period of time. The agencies make no 
effort to define the acceptable period of time, but seek to estimate 
the payback period for others to make the decision themselves. The 
payback period is the point at which reduced fuel expenditures outpace 
increased vehicle costs, including increased maintenance, insurance 
premiums and taxes. The payback periods for vehicles meeting the 
standards considered for the final year of implementation are shown in 
Table I-15, and are similar for both Method A and Method B.

Table I-15--Payback Periods for MY 2027 Vehicles Relative to Baseline 1a
        [Payback cccurs in the year shown; using 7% discounting]
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Tractors/Trailers.........................  2nd.
Vocational Vehicles.......................  4th.
Pickups/Vans..............................  3rd.
------------------------------------------------------------------------


Table I-16--Payback Periods for MY 2027 Vehicles Relative to Baseline 1b
        [Payback occurs in the year shown; using 7% discounting]
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Tractors/Trailers.........................  2nd.
Vocational Vehicles.......................  4th.
Pickups/Vans..............................  3rd.
------------------------------------------------------------------------

(3) Cost Effectiveness
    These regulations implement section 32902(k) of EISA and section 
202(a)(1) and (2) of the Clean Air Act. Through the 2007 EISA, Congress 
directed NHTSA to create a medium- and heavy-duty vehicle fuel 
efficiency program designed to achieve the maximum feasible improvement 
by considering appropriateness, cost effectiveness, and technological 
feasibility to determine maximum feasible standards.\78\ The Clean Air 
Act requires that any air pollutant emission standards for heavy-duty 
vehicles and engines take into account the costs of any requisite 
technology and the lead time necessary to implement such technology. 
Both agencies considered overall costs, overall benefits and cost 
effectiveness in developing the Phase 2 standards. Although there are 
different ways to evaluate cost effectiveness, the essence is to 
consider some measure of costs relative to some measure of impacts.
---------------------------------------------------------------------------

    \78\ This EISA requirement applies to regulation of medium- and 
heavy-duty vehicles. For many years, and as reaffirmed by Congress 
in 2007, ``economic practicability'' has been among the factors EPCA 
requires NHTSA to consider when setting light-duty fuel economy 
standards at the (required) maximum feasible levels. NHTSA 
interprets ``economic practicability'' as a factor involving 
considerations broader than those likely to be involved in ``cost 
effectiveness.''
---------------------------------------------------------------------------

    Considering that Congress enacted EPCA and EISA to, among other 
things, address the need to conserve energy, the agencies have 
evaluated these standards in terms of costs per gallon of fuel 
conserved. We also considered the similar metric of cost of technology 
per ton of CO2e removed, consistent with the objective of 
CAA section 202(a)(1) and (2) to reduce emissions of air pollutants 
which contribute to air pollution which endangers public health and 
welfare. As described in the RIA, the agencies also evaluated these 
standards using the same approaches employed in HD Phase 1. Together, 
the agencies have considered the following three ratios of cost 
effectiveness:

1. Total social costs per gallon of fuel conserved
2. Technology costs per ton of GHG emissions reduced (CO2eq)
3. Technology costs minus fuel savings per ton of GHG emissions reduced

By all three of these measures, the total heavy-duty program will be 
highly cost effective.
    As discussed below, the agencies estimate that over the lifetime of 
heavy-duty vehicles produced for sale in the U.S. during model years 
2018-2029, these standards will cost about $30 billion and conserve 
about 75 billion gallons of fuel, such that the first measure of cost 
effectiveness will be about 40 cents per gallon. Relative to fuel 
prices underlying the agencies' analysis, the agencies have concluded 
that today's standards will be cost effective.
    With respect to the second measure, which is useful for comparisons 
to other GHG rules, these standards will have overall $/ton costs 
similar to the HD Phase 1 rule. As Chapter 7 of the RIA shows, social 
costs will amount to about $30 per metric ton of GHG (CO2eq) 
for the entire HD Phase 2 program. This compares well to both the HD 
Phase 1 rule, which was also estimated to cost about $30 per metric ton 
of GHG (without fuel savings), and to the agencies' estimates of the 
social cost of carbon.\79\ Thus, even without accounting for fuel 
savings, these standards will be cost-effective.
---------------------------------------------------------------------------

    \79\ As described in Section IX.G, the social cost of carbon is 
a metric that estimates the monetary value of impacts associated 
with marginal changes in CO2 emissions in a given year.
---------------------------------------------------------------------------

    The following table include the overall per-unit costs of both 
gallons of fuel conserved and metric tons of GHG emissions abated using 
both a 3 percent and a 7 percent discount rate. Table I-16 gives these 
values under the Method A analysis.

[[Page 73511]]



   Table I-17--Method A Cost Per-Unit of Fuel Savings and GHG Emission
                       Reductions by Vehicle Class
                   [Relative to the dynamic baseline]
------------------------------------------------------------------------
 Per-unit costs (2013$/Unit) by
        vehicle category           3% Discount rate    7% Discount rate
------------------------------------------------------------------------
                Tractors, Including Engines, and Trailers
------------------------------------------------------------------------
Cost per Gallon of Fuel Saved...               $0.28               $0.18
Cost per Ton of GHG Emissions                     20                  13
 Saved..........................
------------------------------------------------------------------------
                 Vocational Vehicles, Including Engines
------------------------------------------------------------------------
Cost per Gallon of Fuel Saved...                0.61                0.40
Cost per Ton of GHG Emissions                     45                  30
 Saved..........................
------------------------------------------------------------------------
                           HD Pickups and Vans
------------------------------------------------------------------------
Cost per Gallon of Fuel Saved...                0.76                0.52
Cost per Ton of GHG Emissions                     67                  46
 Saved..........................
------------------------------------------------------------------------
                              Total Program
------------------------------------------------------------------------
Cost per Gallon of Fuel Saved...                0.40                0.26
Cost per Ton of GHG Emissions                     30                  20
 Saved..........................
------------------------------------------------------------------------

    When considering these values, it is important to emphasize two 
points:
    1. As is shown throughout this rulemaking, the Phase 2 standards 
represent the most stringent standards that are technologically 
feasible and reliably implementable within the lead time provided.
    2. These are not the marginal cost-effectiveness values.
    Without understanding these two points, some readers might assume 
that because the tractor-trailer standards are more cost-effective 
overall than the other standards that manufacturers would choose to 
over-comply with the more cost-effective tractor or trailer standards 
and do less for other vehicles. However, the agencies believe this is 
not a technologically feasible option. Because the tractor and trailer 
standards represent maximum feasible standards, they will effectively 
require manufacturers to deploy all available technology to meet the 
standards. The agencies do not project that manufacturers would be able 
to over-comply with the 2027 standards by a significant margin.
    The third measure deducts fuel savings from costs, which also is 
useful for comparisons to other GHG rules. As shown in Table I-18, the 
agencies have also calculated the cost per metric ton of 
CO2e emission reductions including the savings associated 
with reduced fuel consumption. The calculations presented here include 
all engine-related costs but do not include benefits associated with 
the final program such as those associated with criteria pollutant 
reductions or energy security benefits (discussed in Chapter 8 of this 
RIA). On this basis, net costs per ton of GHG emissions reduced will be 
negative under these standards. This means that the value of the fuel 
savings will be greater than the technology costs, and there will be a 
net cost saving for vehicle owners. In other words, the technologies 
will pay for themselves (indeed, more than pay for themselves) in fuel 
savings.

Table I-18--Annual Net Cost per Metric Ton of CO2eq Emissions Reduced in the Final Program Vs. the Flat Baseline
                                    and Using Method B for Calendar Year 2030
                                          [Dollar values are 2013$] \a\
----------------------------------------------------------------------------------------------------------------
                                                     Vehicle &
                                                    maintenance    Fuel savings     GHG reduced    Net cost ($/
                  Calendar year                        costs        ($billions)        (MMT)        metric ton)
                                                    ($billions)                                         \b\
----------------------------------------------------------------------------------------------------------------
HDE Pickups and Vans............................             1.6             3.9              15               0
Vocational Vehicles.............................             1.5             3.5              14               0
Tractor-Trailers................................             2.3              16              64               0
All Vehicles....................................             5.5              23              94               0
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see the beginning of this Section I.D; for an
  explanation of the flat baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1. GHG reductions
  include CO[ihel2] and CO[ihel2] equivalents of CH4, and N[ihel2]O.
\b\ For each category, fuel savings exceed cost so there is no net cost per ton of GHG reduced.

    In addition, while the net economic benefits (i.e., total benefits 
minus total costs) of these standards is not a traditional measure of 
their cost effectiveness, the agencies have concluded that the total 
costs of these standards are justified in part by their significant 
economic benefits. As discussed in the previous subsection and in 
Section IX, this rule will provide benefits beyond the fuel conserved 
and GHG emissions avoided. The rule's net benefits is a measure that 
quantifies each of its various benefits in economic terms, including 
the economic value of the fuel it saves and the climate-related damages 
it avoids, and compares their sum to the rule's estimated costs. The 
agencies estimate that these standards will result in net economic 
benefits exceeding $100 billion, making this a highly beneficial 
program.
    EPA and NHTSA received many comments suggesting that more

[[Page 73512]]

stringent standards were feasible because many cost effective 
technologies exist for future vehicle designs. While the agencies agree 
that many cost effective technologies exist, and indeed, we reflect the 
potential for many of those technologies to be applied in our analysis 
for today's final rule, commenters who focused on the cost-
effectiveness of technologies did not consistently recognize certain 
real-world constraints on technology implementation. Manufacturers and 
suppliers have limited research and development capacities, and 
although they have some ability to expand (by adding staff or building 
new facilities), the process of developing and applying new 
technologies is inherently constrained by time. Adequate lead time is 
also necessary to complete durability, reliability, and safety testing 
and ramp up production to levels that might be necessary to meet future 
standards. If the agencies fail to account for lead time needs in 
determining the stringency of the standards, we could create unintended 
consequences, such as technologies that are applied before they are 
ready and lead to maintenance and repair problems. In addition to cost-
effectiveness, then, lead time constraints can also be highly relevant 
to feasibility of more stringent standards.

E. EPA and NHTSA Statutory Authorities

    This section briefly summarizes the respective statutory authority 
for EPA and NHTSA to promulgate the Phase 1 and Phase 2 programs. For 
additional details of the agencies' authority, see Section XV of this 
document as well as the Phase 1 rule.\80\
---------------------------------------------------------------------------

    \80\ 76 FR 57106-57129, September 15, 2011.
---------------------------------------------------------------------------

(1) EPA Authority
    Statutory authority for the emission standards in this rule is 
found in CAA section 202(a)(1) and (2) (which requires EPA to establish 
standards for emissions of pollutants from new motor vehicles and 
engines which emissions cause or contribute to air pollution which may 
reasonably be anticipated to endanger public health or welfare), and in 
CAA sections 202(a)(3), 202(d), 203-209, 216, and 301 (42 U.S.C. 7521 
(a)(1) and (2), 7521(d), 7522-7543, 7550, and 7601).
    Title II of the CAA provides for comprehensive regulation of mobile 
sources, authorizing EPA to regulate emissions of air pollutants from 
all mobile source categories. When acting under Title II of the CAA, 
EPA considers such issues as technology effectiveness, its cost (both 
per vehicle, per manufacturer, and per consumer), the lead time 
necessary to implement the technology, and based on this the 
feasibility and practicability of potential standards; the impacts of 
potential standards on emissions reductions of both GHGs and non-GHG 
emissions; the impacts of standards on oil conservation and energy 
security; the impacts of standards on fuel savings by customers; the 
impacts of standards on the truck industry; other energy impacts; as 
well as other relevant factors such as impacts on safety.
    This action implements a specific provision from Title II, section 
202(a). Section 202(a)(1) of the CAA states that ``the Administrator 
shall by regulation prescribe (and from time to time revise) . . . 
standards applicable to the emission of any air pollutant from any 
class or classes of new motor vehicles . . ., which in his judgment 
cause, or contribute to, air pollution which may reasonably be 
anticipated to endanger public health or welfare.'' With EPA's December 
2009 final findings that certain greenhouse gases may reasonably be 
anticipated to endanger public health and welfare and that emissions of 
GHGs from section 202(a) sources cause or contribute to that 
endangerment, section 202(a) requires EPA to issue standards applicable 
to emissions of those pollutants from new motor vehicles. See Coalition 
for Responsible Regulation v. EPA, 684 F. 3d at 116-125, 126-27 cert. 
granted by, in part Util. Air Regulatory Group v. EPA, 134 S. Ct. 418 
(2013), affirmed in part and reversed in part on unrelated grounds by 
Util. Air Regulatory Group v. EPA, 134 S. Ct. 2427 (2014) (upholding 
EPA's endangerment and cause and contribute findings, and further 
affirming EPA's conclusion that it is legally compelled to issue 
standards under section 202(a) to address emission of the pollutant 
which endangers after making the endangerment and cause or contribute 
findings); see also id. at 127-29 (upholding EPA's light-duty GHG 
emission standards for MYs 2012-2016 in their entirety).
    Other aspects of EPA's legal authority, including its authority 
under section 202(a), its testing authority under section 203 of the 
Act, and its enforcement authorities under sections 205 and 207 of the 
Act are discussed fully in the Phase 1 rule, and need not be repeated 
here. See 76 FR 57129-57130.
    In this final rule, EPA is establishing first-time CO2 
emission standards for trailers hauled by tractors. 80 FR 40170. 
Certain commenters, notably the Truck Trailer Manufacturers Association 
(TTMA), maintained that EPA lacks authority to adopt requirements for 
trailer manufacturers, and that emission standards for trailers could 
be implemented, if at all, by requirements applicable to the entity 
assembling a tractor-trailer combination. The argument is that trailers 
by themselves are not ``motor vehicles'' as defined in section 216(2) 
of the Act, that trailer manufacturers therefore do not manufacture 
motor vehicles, and that standards for trailers can be imposed, if at 
all, only on ``the party that joined the trailer to the tractor.'' 
Comments of TTMA, p. 4; Comments of TTMA (March 31, 2016) p. 2.
    EPA also proposed a number of changes and clarifications for rules 
respecting glider kits and glider vehicles. 80 FR 40527-40530. As shown 
in Figure I.1, a glider kit is a tractor chassis with frame, front 
axle, interior and exterior cab, and brakes.

[[Page 73513]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.000

    It is intended for self-propelled highway use, and becomes a glider 
vehicle when an engine, transmission, and rear axle are added. Engines 
are often salvaged from earlier model year vehicles, remanufactured, 
and installed in the glider kit. The final manufacturer of the glider 
vehicle, i.e. the entity that installs an engine, is typically a 
different manufacturer than the original manufacturer of the glider 
kit. The final rule contains emission standards for glider vehicles, 
but does not contain separate standards for glider kits.\81\
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    \81\ As discussed in sections (c) and (d) below, however, 
manufacturers of glider kits can, and typically are, responsible for 
obtaining a certificate of conformity before shipping a glider kit. 
This is because they are manufacturers of motor vehicles, in this 
case, an incomplete vehicle.
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    Many commenters to both the proposed rule and the NODA supported 
EPA's interpretation. However, a number of commenters, including 
Daimler, argued that glider kits are not motor vehicles and so EPA 
lacks the authority to impose any rules respecting their sale or 
configuration. Comments of Daimler, pp. 122-23; Comments of Daimler 
Trucks (April 1, 2016) pp. 2-3. We respond to these comments below, 
with a more detailed response appearing in RTC Section 1.3.1 and 14.2.
    Under the Act, ``motor vehicle'' is defined as ``any self-propelled 
vehicle designed for transporting persons or property on a street or 
highway.'' CAA section 216(2). At proposal, EPA maintained that 
tractor-trailers are motor vehicles and that EPA therefore has the 
authority to promulgate emission standards for complete and incomplete 
vehicles--both the tractor and the trailer. 80 FR 40170. The same 
proposition holds for glider kits and glider vehicles. Id. at 80 FR 
40528. The argument that a trailer, or a glider kit, standing alone, is 
not self-propelled, and therefore is not a motor vehicle, misses the 
key issues of authority under the Clean Air Act to promulgate emission 
standards for motor vehicles produced in discrete segments, and the 
further issue of the entities--namely ``manufacturers''--to which 
standards and certification requirements apply. Simply put, EPA is 
authorized to set emission standards for complete and incomplete motor 
vehicles, manufacturers of complete and incomplete motor vehicles can 
be required to certify to those emission standards, and there can be 
multiple manufacturers of a motor vehicle, each of which can be 
required to certify.
(a) Standards for Complete Vehicles--Tractor-Trailers and Glider 
Vehicles
    Section 202(a)(1) authorizes EPA to set standards ``applicable to 
the emission of any air pollutant from any . . . new motor vehicles.'' 
There is no question that EPA is authorized to establish emission 
standards under this provision for complete new motor vehicles, and 
thus can promulgate emission standards for air pollutants emitted by 
tractor-trailers and by glider vehicles.
    Daimler maintained in its comments that although a glider vehicle 
is a motor vehicle, it is not a ``new'' motor vehicle because ``glider 
vehicles, when constructed retain the identity of the donor vehicle, 
such that the title has already been exchanged, making the vehicles not 
`new' under the CAA.'' Daimler Comments p. 121; see also the similar 
argument in Daimler Truck Comments (April 1, 2016), p. 4. Daimler 
maintains that because title to the powertrain from the donor vehicle 
has already been transferred, the glider vehicle to which the 
powertrain is added cannot be ``new.'' Comments of April 1, 2016 p. 4. 
Daimler also notes that NHTSA considers a truck to be ``newly 
manufactured'' and subject to Federal Motor Vehicle Safety Standards 
when a new cab is used in its assembly, ``unless the engine, 
transmission, and drive axle(s) (as a minimum) of the assembled vehicle 
are not new, and at least two of these components were taken from the 
same vehicle.'' 49 CFR 571.7(e). Daimler urges EPA to adopt a parallel 
provision here.
    First, this argument appears to be untimely. In Phase 1, EPA 
already indicated that glider vehicles are new motor vehicles, at least 
implicitly, by

[[Page 73514]]

adopting an interim exemption for them. See 76 FR 57407 (adopting 40 
CFR 1037.150(j) indicating that the general prohibition against 
introducing a vehicle not subject to current model year standards does 
not apply to MY 2013 or earlier engines). Assuming the argument that 
glider vehicles are not new can be raised in this rulemaking, EPA notes 
that the Clean Air Act defines ``new motor vehicle'' as ``a motor 
vehicle the equitable or legal title to which has never been 
transferred to an ultimate purchaser'' (section 216(3)). Glider 
vehicles are typically marketed and sold as ``brand new'' trucks. 
Indeed, one prominent assembler of glider kits and glider vehicles 
advertises that ``Fitzgerald Glider Kits offers customers the option to 
purchase a brand new 2016 tractor, in any configuration offered by the 
manufacturer . . . Fitzgerald Glider Kits has mastered the process of 
taking the `Glider Kit' and installing the components to work 
seamlessly with the new truck.'' \82\ The purchaser of a ``new truck'' 
necessarily takes initial title to that truck.\83\ Daimler would have 
it that this `new truck' terminology is a mere marketing ploy, but it 
obviously reflects reality. As shown in Figure I.1 above, the glider 
kit constitutes the major parts of the vehicle, lacking only the 
engine, transmission, and rear axle. The EPA sees nothing in the Act 
that compels the result that adding a used component to an otherwise 
new motor vehicle necessarily vitiates classification of the motor 
vehicle as ``new.'' See 80 FR 40528. Rather, reasonable judgments must 
be made, and in this case, the agency believes it reasonable that the 
tail need not wag the dog: Adding the engine and transmission to the 
otherwise-complete vehicle does not prevent the glider vehicle from 
being ``new''--as marketed. The fact that this approach is reasonable, 
if not mandated, is confirmed by the language of the Act's definition 
of ``new motor vehicle engine,'' which includes any ``engine in a new 
motor vehicle'' without regard to whether or not the engine was 
previously used. EPA has also previously addressed the issue of used 
components in new engines and vehicles explicitly in regulations in the 
context of locomotives and locomotive engines in 40 CFR part 1033. 
There we defined remanufactured locomotives and locomotive engines to 
be ``new'' locomotives and locomotive engines. See 63 FR 18980; see 
also Summary and Analysis of Comments on Notice of Proposed Rulemaking 
for Emission Standards for Locomotives and Locomotive Engines (EPA-420-
R-97-101 (December 1997)) at pp. 10-14. This is a further reason that 
the model year of the engine is not determinative of whether a glider 
vehicle is ``new.'' As to the suggestion to adopt a provision parallel 
to the NHTSA definition, EPA notes that the NHTSA definition was 
developed for different purposes using statutory authority which 
differs from the Clean Air Act in language and intent. There 
consequently is no basis for requiring EPA to adopt such a definition, 
and doing so would impede meaningful control of both GHG emissions and 
criteria pollutant emissions from glider vehicles.
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    \82\ Advertisement for Fitzgerald Glider kits in Overdrive 
magazine (December 2015) (emphasis added).
    \83\ Fitzgerald states ``All Fitzgerald glider kits will be 
titled in the state of Tennessee and you will receive a title to 
transfer to your state.'' https://www.fitzgeraldgliderkits.com/frequently-asked-questions. Last accessed July 9, 2016.
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(b) Standards for Incomplete Vehicles
    Section 202(a)(1) not only authorizes EPA to set standards 
``applicable to the emission of any air pollutant from any . . . new 
motor vehicles,'' but states further that these standards are 
applicable ``whether such vehicles . . . are designed as complete 
systems or incorporate devices to prevent or control such pollution.'' 
The Act in fact thus not only contemplates, but in some instances, 
directly commands that EPA establish standards for incomplete vehicles 
and vehicle components. See CAA section 202(a)(6) (standards for 
onboard vapor recovery systems on ``new light-duty vehicles,'' and 
requiring installation of such systems); section 202(a)(5)(A) 
(standards to control emissions from refueling motor vehicles, and 
requiring consideration of, and possible design standards for, fueling 
system components); 202(k) (standards to control evaporative emissions 
from gasoline-fueled motor vehicles). Both TTMA and Daimler argued, in 
effect, that these provisions are the exceptions that prove the rule 
and that without this type of enumerated exception, only entire, 
complete vehicles can be considered to be ``motor vehicles.'' This 
argument is not persuasive. Congress did not indicate that these 
incomplete vehicle provisions were exceptions to the definition of 
motor vehicle. Just the opposite. Without amending the new motor 
vehicle definition, or otherwise indicating that these provisions were 
not already encompassed within Title II authority over ``new motor 
vehicles'', Congress required EPA to set standards for evaporative 
emissions from a portion of a motor vehicle. Congress thus indicated in 
these provisions: (1) That standards should apply to ``vehicles'' 
whether or not the ``vehicles'' were designed as complete systems; (2) 
that some standards should explicitly apply only to certain components 
of a vehicle that are plainly not self-propelled. Congress thus 
necessarily was of the view that incomplete vehicles can be motor 
vehicles.
    Emission standards EPA sets pursuant to this authority thus can be, 
and often are focused on emissions from the new motor vehicle, and from 
portions, systems, parts, or components of the vehicle. Standards thus 
apply not just to exhaust emissions, but to emissions from non-exhaust 
portions of a vehicle, or from specific vehicle components or parts. 
See the various evaporative emission standards for light duty vehicles 
in 40 CFR part 86, subpart B (e.g., 40 CFR 86.146-96 and 86.150-98 
(refueling spitback and refueling test procedures); 40 CFR 1060.101-103 
and 73 FR 59114-59115 (various evaporative emission standards for small 
spark ignition equipment); 40 CFR 86.1813-17(a)(2)(iii) (canister bleed 
evaporative emission test procedure, where testing is solely of fuel 
tank and evaporative canister); see also 79 FR 23507 (April 28, 2014) 
(incomplete heavy duty gasoline vehicles could be subject to, and 
required to certify compliance with, evaporative emission standards)). 
These standards are implemented by testing the particular vehicle 
component, not by whole vehicle testing, notwithstanding that the 
component may not be self-propelled until it is installed in the 
vehicle or (in the case of non-road equipment), propelled by an 
engine.\84\
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    \84\ ``Non-road vehicles'' are defined differently than ``motor 
vehicles'' under the Act, but the difference does not appear 
relevant here. Non-road vehicles, like motor vehicles, must be 
propelled by an engine. See CAA section 216(11) (`` `nonroad 
vehicle' means a vehicle that is powered by a nonroad engine''). 
Pursuant to this authority, EPA has promulgated many emission 
standards applicable to components of engineless non-road equipment, 
for which the equipment manufacturer must certify.
---------------------------------------------------------------------------

    EPA thus can set standards for all or just a portion of the motor 
vehicle notwithstanding that an incomplete motor vehicle may not yet be 
self-propelled. This is not to say that the Act authorizes emission 
standards for any part of a motor vehicle, however insignificant. Under 
the Act it is reasonable to consider both the significance of the 
components in comparison to the entire vehicle and the significance of 
the components for achieving emissions reductions. A vehicle that is 
complete except for an ignition switch can be subject to standards even 
though it is not self-

[[Page 73515]]

propelled. Likewise, as just noted, vehicle components that are 
significant for controlling evaporative emissions can be subject to 
standards even though in isolation the components are not self-
propelled. However, not every individual component of a complete 
vehicle can be subjected to standards as an incomplete vehicle. To 
reflect these considerations, EPA is adopting provisions stating that a 
trailer is a vehicle ``when it has a frame with one or more axles 
attached,'' and a glider kit becomes a vehicle when ``it includes a 
passenger compartment attached to a frame with one or more axles.'' 
Section 1037.801 definition of ``vehicle,'' paragraphs (1)(ii) and 
(iii); see also Section XIII.B below.
    TTMA and Daimler each maintained that this claim of authority is 
open-ended, and can be extended to the least significant vehicle part. 
As noted above, EPA acknowledges that lines need to be drawn, but 
whether looking at the relation between the incomplete vehicle and the 
complete vehicle, or looking at the relation between the incomplete 
vehicle and the emissions control requirements, it is evident that 
trailers and glider kits should properly be treated as vehicles, albeit 
incomplete ones.\85\ They properly fall on the vehicle side of the 
line. When one finishes assembling a whole aggregation of parts to make 
a finished section of the vehicle (e.g. the trailer), that is 
sufficient. You have an entire, complete section made up of assembled 
parts. Everything needed to be a trailer is complete. This is not an 
engine block, a wheel, or a headlight. Similarly, glider kits comprise 
the largely assembled tractor chassis with front axles, frame, interior 
and exterior cab, and brakes. This is not a few assembled components; 
rather, it is an assembled truck with a few components missing. See CAA 
section 216(9) of the Act, which defines ``motor vehicle or engine part 
manufacturer'' as ``any person engaged in the manufacturing, assembling 
or rebuilding of any device, system, part, component or element of 
design which is installed in or on motor vehicles or motor vehicle 
engines.'' Trailers and glider kits are not ``installed in or on'' a 
motor vehicle. A trailer is half of the tractor-trailer, not some 
component installed on the tractor. And one would more naturally refer 
to the donor drivetrain being installed on the glider kit than vice 
versa. See Figure I.1 above. Furthermore, as discussed below, the 
trailer and the glider kit are significant for purposes of controlling 
emissions from the completed vehicle.
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    \85\ Cf. Marine Shale Processors v. EPA, 81 F. 3d 1371, 1383 
(5th Cir. 1996) (``[w]e make no comment on this argument: This is 
simply not a thimbleful case'').
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    Incomplete vehicle standards must, of course, be reasonably 
designed to control emissions caused by that particular vehicle 
segment. The standards for trailers would do so and account for the 
tractor-trailer combination by using a reference tractor in the trailer 
test procedure (and, conversely, by use of a reference trailer in the 
tractor test procedure). The Phase 2 rule contains no emission 
standards for glider kits in isolation, but the standards for glider 
vehicles necessarily reflect the contribution of the glider kit.
(c) Application of Emission Standards to Manufacturers
    In some ways, the critical issue is to whom these emission 
standards apply. As explained in this section, the emission standards 
apply to manufacturers of motor vehicles, and manufacturers thus are 
required to test and to certify compliance to those standards. 
Moreover, the Act contemplates that a motor vehicle can have multiple 
manufacturers. With respect to the further question of which 
manufacturer certifies and tests in multiple manufacturer situations, 
EPA rules have long contained provisions establishing responsibilities 
where a vehicle has multiple manufacturers. We are applying those 
principles in the Phase 2 rules. The overarching principle is that the 
entity with most control over the particular vehicle segment due to 
producing it is usually the most appropriate entity to test and 
certify.\86\ EPA is implementing the trailer and glider vehicle 
emission standards in accord with this principle, so that the entities 
required to test and certify are the trailer manufacturer and, for 
glider kits and glider vehicles, either the manufacturer of the glider 
kit or glider vehicle, depending on which is more appropriate in 
individual circumstances.
---------------------------------------------------------------------------

    \86\ See discussion of standards applicable to small SI 
equipment fuel systems, implemented by standards for the 
manufacturers of that equipment at 73 FR 59115 (``In most cases, 
nonroad standards apply to the manufacturer of the engine or the 
manufacturer of the nonroad equipment. Here, the products subject to 
the standards (fuel lines and fuel tanks) are typically manufactured 
by a different manufacturer. In most cases the engine manufacturers 
do not produce complete fuel systems and therefore are not in a 
position to do all the testing and certification work necessary to 
cover the whole range of products that will be used. We are 
therefore providing an arrangement in which manufacturers of fuel-
system components are in most cases subject to the standards and are 
subject to certification and other compliance requirements 
associated with the applicable standards'').
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(i) Definition of Manufacturer
    Emission standards are implemented through regulation of the 
manufacturer of the new motor vehicle. See, e.g. section 206(a)(1) 
(certification testing of motor vehicle submitted by ``a 
manufacturer''); 203(a)(1) (manufacturer of new motor vehicle 
prohibited from introducing uncertified motor vehicles into commerce); 
207(a)(1) (manufacturer of motor vehicle to provide warranty to 
ultimate purchaser of compliance with applicable emission standards); 
207(c) (recall authority); 208(a) (recordkeeping and testing can be 
required of every manufacturer of new motor vehicle).
    The Act further distinguishes between manufacturers of motor 
vehicles and manufacturers of motor vehicle parts. See, e.g. section 
206(a)(2) (voluntary emission control system verification testing); 
203(a)(3)(B) (prohibition on parts manufacturers and other persons 
relating to defeat devices); 207(a)(2) (parts manufacturer may provide 
warranty certification regarding use of parts); 208(a) (recordkeeping 
and testing requirements for manufacturers of vehicle and engine 
``parts or components'').
    Thus, the question here is whether a trailer manufacturer or glider 
kit manufacturer can be a manufacturer of a new motor vehicle and 
thereby become subject to the certification and related requirements 
for manufacturers, or must necessarily be classified as a manufacturer 
of a motor vehicle part or component. EPA may reasonably classify 
trailer manufacturers and glider kit manufacturers as motor vehicle 
manufacturers.
    Section 216(1) defines a ``manufacturer'' as ``any person engaged 
in the manufacturing or assembling of new motor vehicles, new motor 
vehicle engines, new nonroad vehicles or new nonroad engines, or 
importing such vehicles or engines for resale, or who acts for and is 
under the control of any such person in connection with the 
distribution of new motor vehicles, new motor vehicle engines, new 
nonroad vehicles or new nonroad engines, but shall not include any 
dealer with respect to new motor vehicles, new motor vehicle engines, 
new nonroad vehicles or new nonroad engines received by him in 
commerce.''
    It appears plain that this definition was not intended to restrict 
the definition of ``manufacturer'' to a single person per vehicle. The 
use of the conjunctive, specifying that a manufacturer is ``any person 
engaged in the manufacturing or assembling of new motor vehicles . . . 
or who acts for and is under the control of any such person

[[Page 73516]]

. . .'' (emphasis added) indicates that Congress anticipated that motor 
vehicles could have more than one manufacturer, since in at least some 
cases those will plainly be different people. The capacious reference 
to ``any person engaged in the manufacturing of motor vehicles'' 
likewise allows the natural inference that it could apply to multiple 
entities engaged in manufacturing.\87\
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    \87\ See United States v. Gonzales, 520 U.S. 1, 5, (1997) 
(``Read naturally the word `any' has an expansive meaning, that is, 
`one or some indiscriminately of whatever kind'); New York v. EPA, 
443 F.3d 880, 884-87 (D.C. Cir. 2006).
---------------------------------------------------------------------------

    The provision also applies both to entities that manufacture and 
entities that assemble, and does so in such a way as to encompass 
multiple parties: Manufacturers ``or'' (rather than `and') assemblers 
are included. Nor is there any obvious reason that only one person can 
be engaged in vehicle manufacture or vehicle assembling.
    Reading the Act to provide for multiple motor vehicle manufacturers 
reasonably reflects industry realities, and achieves important goals of 
the CAA. Since title II requirements are generally imposed on 
``manufacturers'' it is important that the appropriate parties be 
included within the definition of manufacturer--``any person engaged in 
the manufacturing or assembling of new motor vehicles.'' Indeed, as set 
out in Chapter 1 of the RIA, most heavy duty vehicles are manufactured 
or assembled by multiple entities; see also Comments of Daimler 
(October 1, 2015) p. 103.\88\ One entity produces a chassis; a 
different entity manufactures the engine; specialized components (e.g. 
garbage compactors, cement mixers) are produced by still different 
entities. For tractor-trailers, one person manufactures the tractor, 
another the trailer, a third the engine, and another typically 
assembles the trailer to the tractor. Installation of various vehicle 
components occurs at different and varied points and by different 
entities, depending on ultimate desired configurations. See, e.g. 
Comments of Navistar (October 1, 2015), pp. 12-13. The heavy duty 
sector thus differs markedly from the light duty sector (and from 
manufacturing of light duty pickups and vans), where a single company 
designs the vehicle and engine (and many of the parts), and does all 
assembling of components into the finished motor vehicle.
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    \88\ ``The EPA should understand that vehicle manufacturing is a 
multi-stage process (regardless of the technologies on the vehicles) 
and that each stage of manufacturer has the incentive to properly 
complete manufacturing . . . [T]he EPA should continue the 
longstanding industry practice of allowing primary manufacturers to 
pass incomplete vehicles with incomplete vehicle documents to 
secondary manufacturers who complete the installation.''
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(ii) Controls on Manufacturers of Trailers
    It is reasonable to view the trailer manufacturer as ``engaged in'' 
(section 216(1)) the manufacturing or assembling of the tractor-
trailer. The trailer manufacturer designs, builds, and assembles a 
complete and finished portion of the tractor-trailer. All components of 
the trailer--the tires, axles, flat bed, outsider cover, aerodynamics--
are within its control and are part of its assembling process. The 
trailer manufacturer sets the design specifications that affect the GHG 
emissions attributable to pulling the trailer. It commences all work on 
the trailer, and when that work is complete, nothing more is to be 
done. The trailer is a finished product. With respect to the trailer, 
the trailer manufacturer is analogous to the manufacturer of the light 
duty vehicle, specifying, controlling, and assembling all aspects of 
the product from inception to completion. GHG emissions attributable to 
the trailer are a substantial portion of the total GHG emissions from 
the tractor-trailer.\89\ Moreover, the trailer manufacturer is not 
analogous to the manufacturer of a vehicle part or component, like a 
tire manufacturer, or to the manufacturer of a side skirt. The trailer 
is a significant, integral part of the finished motor vehicle, and is 
essential for the tractor-trailer to carry out its commercial purpose. 
See 80 FR 40170. Although it is true that another person may ultimately 
hitch the trailer to a tractor (which might be viewed as completing 
assembly of the tractor-trailer), as noted above, EPA does not believe 
that the fact that one person might qualify as a manufacturer, due to 
``assembling'' the motor vehicle, precludes another person from 
qualifying as a manufacturer, due to ``manufacturing'' the motor 
vehicle. Given that section 216(1) does not restrict motor vehicle 
manufacturers to a single entity, it appears to be consistent with the 
facts and the Act to consider trailer manufacturers as persons engaged 
in the manufacture of a motor vehicle.
---------------------------------------------------------------------------

    \89\ The relative contribution of trailer controls depends on 
the types of tractors and trailers, as well as the tier of standards 
applicable; however, it can be approximately one-third of the total 
reduction achievable for the tractor-trailer.
---------------------------------------------------------------------------

    This interpretation of section 216(1) is also reasonable in light 
of the various provisions noted above relating to implementation of the 
emissions standards--certification under section 206, prohibitions on 
entry into commerce under section 203, warranty and recall under 
section 207, and recordkeeping/reporting under section 208. All of 
these provisions are naturally applied to the entity responsible for 
manufacturing the trailer, which manufacturer is likewise responsible 
for its GHG emissions.
    TTMA maintains that if a tractor-trailer is a motor vehicle, then 
only the entity connecting the trailer to the tractor could be subject 
to regulation.\90\ This is not a necessary interpretation of section 
216(1), as explained above. TTMA does not discuss that provision, but 
notes that other provisions refer to ``a'' manufacturer (or, in one 
instance, ``the'' manufacturer), and maintains that this shows that 
only a single entity can be a manufacturer. See TTMA Comment pp. 4-5, 
citing to sections 206(a)(1), 206(b), 207, and 203(a). This reading is 
not compelled by the statutory text. First, the term ``manufacturer'' 
in all of these provisions necessarily reflects the underlying 
definition in section 216(1), and therefore is not limited to a single 
entity, as just discussed. Second, the interpretation makes no 
practical sense. An end assembler of a tractor-trailer is not in a 
position to certify and warrant performance of the trailer, given that 
the end-assembler has no control over how trailers are designed, 
constructed, or even which trailers are attached to the tractor. It 
makes little sense for the entity least able to control the outcome to 
be responsible for that outcome. The EPA doubts that Congress compelled 
such an ungainly implementation mechanism, especially given that it is 
well known that vehicle manufacture responsibility in the heavy duty 
vehicle sector is divided, and given further that title II includes 
requirements for EPA to promulgate emission standards for portions of 
vehicles.
---------------------------------------------------------------------------

    \90\ Consequently, the essential issue here is not whether EPA 
can issue and implement emission standards for trailers, but at what 
point in the implementation process those standards apply.
---------------------------------------------------------------------------

(iii) Controls on Manufacturers of Glider Kits
    Application of these same principles indicate that a glider kit 
manufacturer is a manufacturer of a motor vehicle and, as an entity 
responsible for assuring that glider vehicles meet the Phase 2 vehicle 
emission standards, can be a party in the certification process as 
either the certificate holder or the entity which provides essential 
test information to the glider vehicle manufacturer. As noted above, 
glider kits include the entire tractor chassis, cab, tires, body, and 
brakes. Glider kit manufacturers thus control critical elements of the

[[Page 73517]]

ultimate vehicle's greenhouse gas emissions, in particular, all 
aerodynamic features and all emissions related to steer tire type. 
Glider kit manufacturers would therefore be the entity generating 
critical GEM inputs--at the least, those for aerodynamics and tires. 
Glider kit manufacturers also often know the final configuration of the 
glider vehicle, i.e. the type of engine and transmission which the 
final assembler will add to the glider kit.\91\ This is because the 
typical glider kit contains all necessary wiring, and it is necessary, 
in turn, for the glider kit manufacturer to know the end configuration 
in order to wire the kit properly. Thus, a manufacturer of a glider kit 
can reasonably be viewed as a manufacturer of a motor vehicle under the 
same logic as above: There can be multiple manufacturers of a motor 
vehicle; the glider kit manufacturer designs, builds, and assembles a 
substantial, complete and finished portion of the motor vehicle; and 
that portion contributes substantially to the GHG emissions from the 
ultimate glider vehicle. A glider kit is not a vehicle part; rather, it 
is an assembled truck with a few components missing.
---------------------------------------------------------------------------

    \91\ PACCAR indicated in its comments that manufacturers of 
glider kits may not know all details of final assembly. Provisions 
on delegated assembly, shipment of incomplete vehicles to secondary 
manufacturers, and assembly instructions for secondary vehicle 
manufacturers allow manufacturers of glider kits and glider vehicles 
to apportion responsibilities, as appropriate, including 
responsibility as to which entity shall be the certificate holder. 
See 40 CFR 1037.130, 1037.621, and 1037.622. Our point here is that 
both of these entities are manufacturers of the glider motor vehicle 
and therefore that both are within the Act's requirements for 
certification and testing.
---------------------------------------------------------------------------

    EPA rules have long provided provisions establishing 
responsibilities where there are multiple manufacturers of motor 
vehicles. See 40 CFR 1037.620 (responsibilities for multiple 
manufacturers), 40 CFR 1037.621 (delegated assembly), and 40 CFR 
1037.622 (shipment of incomplete vehicles to secondary vehicle 
manufacturers). These provisions, in essence, allow manufacturers to 
determine among themselves as to which should be the certificate 
holder, and then assign respective responsibilities depending on that 
decision. The end result is that incomplete vehicles cannot be 
introduced into commerce without one of the manufacturers being the 
certificate holder.
    Under the Phase 1 rules, glider kits are considered to be 
incomplete vehicles which may be introduced into commerce to a 
secondary manufacturer for final assembly. See 40 CFR 1037.622(b)(1)(i) 
and 1037.801 (definition of ``vehicle'' and ``incomplete vehicle'') of 
the Phase 1 regulations (76 FR 57421). Note that 40 CFR 
1037.622(b)(1)(i) was originally codified as 40 CFR 1037.620(b)(1)(i). 
EPA is expanding somewhat on these provisions, but in essence, as under 
Phase 1, glider kit and glider vehicle manufacturers could operate 
under delegated assembly provisions whereby the glider kit manufacturer 
would be the certificate holder. See 40 CFR 1037.621 of the final 
regulations. Glider kit manufacturers would also continue to be able to 
ship uncertified kits to secondary manufacturers, and the secondary 
manufacturer must assemble the vehicle into certifiable condition. 40 
CFR 1037.622.\92\
---------------------------------------------------------------------------

    \92\ Under this provision in the Phase 2 regulations, the glider 
kit manufacturer would still have some responsibility to ensure that 
products they introduce into U.S. commerce will conform with the 
regulations when delivered to the ultimate purchasers.
---------------------------------------------------------------------------

(d) Additional Authorities Supporting EPA's Actions
    Even if, against our view, trailers and glider kits are not 
considered to be ``motor vehicles,'' and the entities engaged in 
assembling trailers and glider kits are not considered to be 
manufacturers of motor vehicles, the Clean Air Act still provides 
authority for the testing requirements adopted here. Section 208 (a) of 
the Act authorizes EPA to require ``every manufacturer of new motor 
vehicle or engine parts or components'' to ``perform tests where such 
testing is not otherwise reasonably available.'' This testing can be 
required to ``provide information the Administrator may reasonably 
require to determine whether the manufacturer . . . has acted or is 
acting in compliance with this part,'' which includes showing whether 
or not the parts manufacturer is engaged in conduct which can cause a 
prohibited act. Testing would be required to show that the trailer will 
conform to the vehicle emission standards. In addition, testing for 
trailer manufacturers would be necessary here to show that the trailer 
manufacturer is not causing a violation of the combined tractor-trailer 
GHG emission standard either by manufacturing a trailer which fails to 
comply with the trailer emission standards, or by furnishing a trailer 
to the entity assembling tractor-trailers inconsistent with tractor-
trailer certified condition. Testing for glider kit manufacturers is 
necessary to prevent a glider kit manufacturer furnishing a glider kit 
inconsistent with the tractor's certified condition. In this regard, we 
note that section 203 (a)(1) of the Act not only prohibits certain 
acts, but also prohibits ``the causing'' of those acts. Furnishing a 
trailer not meeting the trailer standard would cause a violation of 
that standard, and the trailer manufacturer would be liable under 
section 203 (a)(1) for causing the prohibited act to occur. Similarly, 
a glider kit supplied in a condition inconsistent with the tractor 
standard would cause the manufacturer of the glider vehicle to violate 
the GHG emission standard, so the glider kit manufacturer would be 
similarly liable under section 203 (a)(1) for causing that prohibited 
act to occur.
    In addition, section 203 (a)(3)(B) prohibits use of `defeat 
devices'--which include ``any part or component intended for use with, 
or as part of, any motor vehicle . . . where a principal effect of the 
part or component is to . . . defeat . . . any . . . element of design 
installed . . . in a motor vehicle'' otherwise in compliance with 
emission standards. Manufacturing or installing a trailer not meeting 
the trailer emission standard could thus be a defeat device causing a 
violation of the emission standard. Similarly, a glider kit 
manufacturer furnishing a glider kit in a configuration that would not 
meet the tractor standard when the specified engine, transmission, and 
axle are installed would likewise cause a violation of the tractor 
emission standard. For example, providing a tractor with a coefficient 
of drag or tire rolling resistance level inconsistent with tractor 
certified condition would be a violation of the Act because it would 
cause the glider vehicle assembler to introduce into commerce a new 
tractor that is not covered by a valid certificate of conformity. 
Daimler argued in its comments that a glider kit would not be a defeat 
device because glider vehicles use older engines which are more fuel 
efficient since they are not meeting the more rigorous standards for 
criteria pollutant emissions. (Daimler Truck Comment, April 1, 2016, p. 
5). However, the glider kit would be a defeat device with respect to 
the tractor vehicle standard, not the separate engine standard. A non-
conforming glider kit would adversely affect compliance with the 
vehicle standard, as just explained. Furthermore, as explained in RTC 
Section 14.2, Daimler is incorrect that glider vehicles are more fuel 
efficient than Phase 1 2017 and later vehicles, much less Phase 2 
vehicles.
    In the memorandum accompanying the Notice of Data Availability, EPA 
solicited comment on adopting additional regulations based on these 
principles. EPA has decided not to adopt those provisions, but again 
notes

[[Page 73518]]

that the authorities in CAA sections 208 and 203 support the actions 
EPA is taking here with respect to trailer and glider kit testing.
(e) Standards for Glider Vehicles and Lead Time for Those Standards
    At proposal, EPA indicated that engines used in glider vehicles are 
to be certified to standards for the model year in which these vehicles 
are assembled. 80 FR 40528. This action is well within the agency's 
legal authority. As noted above, the Act's definition of ``new motor 
vehicle engine,'' includes any ``engine in a new motor vehicle'' 
without regard to whether or not the engine was previously used. Given 
the Act's purpose of controlling emissions of air pollutants from motor 
vehicle engines, with special concern for pollutant emissions from 
heavy-duty engines (see, e.g., section 202(a)(3)(A) and (B)), it is 
reasonable to require engines placed in newly-assembled vehicles to 
meet the same standards as all other engines in new motor vehicles. Put 
another way, it is both consistent with the plain language of the Act 
and reasonable and equitable for the engines in ``new trucks'' (see 
Section I.E.(1)(a) above) to meet the emission standards for all other 
engines installed in new trucks.
    Daimler challenged this aspect of EPA's proposal, maintaining that 
it amounted to regulation of vehicle rebuilding, which (according to 
the commenter) is beyond EPA's authority. Comments of Daimler, p. 123; 
Comments of Daimler Trucks (April 1, 2016) p. 3. This comment is 
misplaced. The EPA has authority to regulate emissions of pollutants 
from engines installed in new motor vehicles. As explained in 
subsection (a) above, glider vehicles are new motor vehicles. As also 
explained above, the Act's definition of ``new motor vehicle engine'' 
includes any ``engine in a new motor vehicle'' without regard to 
whether or not the engine was previously used. CAA section 216(3). 
Consequently, a previously used engine installed in a glider vehicle is 
within EPA's multiple authorities. See CAA sections 202(a)(1) (GHGs), 
202(a)(3)(A) and (B)(ii) (hydrocarbon, CO, PM and NOX from 
heavy-duty vehicles or engines), and 202(a)(3)(D) (pollutants from 
rebuilt heavy duty engines).\93\
---------------------------------------------------------------------------

    \93\ Comments from, e.g. Mondial and MEMA made clear that all of 
the donor engines installed in glider vehicles are rebuilt. See also 
http://www.truckinginfo.com/article/story/2013/04/the-return-of-the-glider.aspx (``1999 to 2002-model diesels were known for 
reliability, longevity and good fuel mileage. Fitzgerald favors 
Detroit's 12.7-liter Series 60 from that era, but also installs pre-
EGR 14-liter Cummins and 15-liter Caterpillar diesels. All are 
rebuilt. . . .'').
---------------------------------------------------------------------------

    As explained in more detail in Section XIII.B, the final rule 
requires that as of January 1, 2017, glider kit and glider vehicle 
production involving engines not meeting criteria pollutant standards 
corresponding to the year of glider vehicle assembly be allowed at the 
highest annual production for any year from 2010 to 2014. See section 
1037.150(t)(3). (Certain exceptions to this are explained in Section 
XIII.B.) The rule further requires that as of January 1, 2018, engines 
in glider vehicles meet criteria pollutant standards and GHG standards 
corresponding to the year of the glider vehicle assembly, but allowing 
certain small businesses to introduce into commerce vehicles with 
engines meeting criteria pollutant standards corresponding to the year 
of the engine for up to 300 vehicles per year, or up to the highest 
annual production volume for calendar years 2010 to 2014, whichever is 
less. Section 1037.150(t)(1)(ii) (again subject to various exceptions 
explained in Section XIII.B). Glider vehicles using these exempted 
engines will not be subject to the Phase 1 GHG vehicle standards, but 
will be subject to the Phase 2 vehicle standards beginning with MY 
2021. As explained in Section XIII.B, there are compelling 
environmental reasons for taking these actions in this time frame.
    With regard to the issue of lead time, EPA indicated at proposal 
that the agency has long since justified the criteria pollutant 
standards for engines installed in glider kits. 80 FR 40528. EPA 
further proposed that engines installed in glider vehicles meet the 
emission standard for the year of glider vehicle assembly, as of 
January 1, 2018 and solicited comment on an earlier effective date. Id. 
at 40529. The agency noted that CAA section 202(a)(3)(D) \94\ requires 
that standards for rebuilt heavy-duty engines take effect ``after a 
period . . . necessary to permit the development and application of the 
requisite control measures.'' Here, no time is needed to develop and 
apply requisite control measures for criteria pollutants because 
compliant engines are immediately available. In fact, manufacturers of 
compliant engines, and dealers of trucks containing those compliant 
engines, commented that they are disadvantaged by manufacturing more 
costly compliant engines while glider vehicles avoid using those 
engines. Not only are compliant engines immediately available, but (as 
commenters warned) there can be risk of massive pre-buys. Moreover, EPA 
does not envision that glider manufacturers will actually modify the 
older engines to meet the applicable standards. Rather, they will 
either choose from the many compliant engines available today, or they 
will seek to qualify under other flexibilities provided in the final 
rule. See Section XIII.B. Given that compliant engines are immediately 
available, the flexibilities provided in the final rule for continued 
use of donor engines for traditional glider vehicle functions and by 
small businesses, and the need to expeditiously prevent further 
perpetuation of use of heavily polluting engines, EPA sees a need to 
begin constraining this practice on January 1, 2017. However, the final 
rule is merely capping glider production using higher-polluting engines 
in 2017 at 2010-2014 production levels, which would allow for the 
production of thousands of glider vehicles using these higher polluting 
engines, and unlimited production of glider vehicles using less 
polluting engines.
---------------------------------------------------------------------------

    \94\ The engine rebuilding authority of section 202(a)(3)(D) 
includes removal of an engine from the donor vehicle. See 40 CFR 
86.004-40 and 62 FR 54702 (Oct. 21, 1997). EPA interprets this 
language as including installation of the removed engine into a 
glider kit, thereby assembling a glider vehicle.
---------------------------------------------------------------------------

    Various commenters, however, argued that the EPA must provide four 
years lead-time and three-year stability pursuant to section 
202(a)(3)(C) of the Act, which applies to regulations for criteria 
pollutant emissions from heavy duty vehicles or engines. For criteria 
pollutant standards, CAA section 202(a)(3)(C) establishes lead time and 
stability requirements for ``[a]ny standard promulgated or revised 
under this paragraph and applicable to classes or categories of heavy 
duty vehicles or engines.'' In this rule, EPA is generally requiring 
large manufacturers of glider vehicles to use engines that meet the 
standards for the model year in which a vehicle is manufactured. EPA is 
not promulgating new criteria pollutant standards. The NOX 
and PM standards that apply to heavy duty engines were promulgated in 
2001.
    We are not amending these provisions or promulgating new criteria 
pollutant standards for heavy duty engines here. EPA interprets the 
phrase ``classes or categories of heavy duty vehicles or engines'' in 
CAA section 202(a)(3)(C) to refer to categories of vehicles established 
according to features such as their weight, functional type, (e.g. 
tractor, vocational vehicle, or pickup truck) or engine cycle (spark-
ignition or compression-ignition), or weight class of the vehicle into 
which an engine is installed (LHD, MHD, or HHD). EPA has established 
several different categories

[[Page 73519]]

of heavy duty vehicles (distinguished by gross vehicle weight, engine-
cycle, and other criteria related to the vehicles' intended purpose) 
and is establishing in this rule GHG standards applicable to each 
category.\95\ By contrast, a ``glider vehicle'' is defined not by its 
weight or function but by its method of manufacture. A Class 8 tractor 
glider vehicle serves exactly the same function and market as a Class 8 
tractor manufactured by another manufacturer. Similarly, rebuilt 
engines installed in glider vehicles (i.e. donor engines) are not 
distinguished by engine cycle, but rather serve the same function and 
market as any other HHD or MHD engine. Thus, EPA considers ``glider 
vehicles'' to be a description of a method of manufacturing new motor 
vehicles, not a description of a separate ``class or category'' of 
heavy duty vehicles or engines. Consequently, EPA is not adopting new 
standards for a class or category of heavy duty engines within the 
meaning of section 202(a)(3)(C) of the Act.
---------------------------------------------------------------------------

    \95\ Note, however, the Phase 2 GHG standards for tractors and 
vocational vehicles do not apply until MY 2021.
---------------------------------------------------------------------------

    EPA believes this approach is most consistent with the statutory 
language and the goals of the Clean Air Act. The date of promulgation 
of the criteria pollutant standards was 2001. There has been plenty of 
lead time for the criteria pollutant standards and as a result, 
manufacturers of glider vehicles have many options for compliant 
engines that are available on the market today--just as manufacturers 
of other new heavy-duty vehicles do. We are even providing additional 
compliance flexibilities to glider manufacturers in recognition of the 
historic practice of salvaging a small number of engines from vehicles 
involved in crashes. See Section XIII.B. We do not believe that 
Congress intended to allow changes in how motor vehicles are 
manufactured to be a means of avoiding existing, applicable engine 
standards. Obviously, any industry attempts to avoid or circumvent 
standards will not become apparent until the standards begin to apply. 
The commenters' interpretation would effectively preclude EPA from 
curbing many types of avoidance, however dangerous, until at least four 
years from detection.
    As to Daimler's further argument that the lead time provisions in 
section 202(3)(C) not only apply but also must trump those specifically 
applicable to heavy duty engine rebuilding, the usual rule of 
construction is that the more specific provision controls. See, e.g. 
HCSC-Laundry v. U.S., 450 U.S.1, 6 (1981). Daimler's further argument 
that section 202(a)(3)(C) lead time provisions also apply to engine 
rebuilding because those provisions fall within the same paragraph 
would render the separate lead time provisions for engine rebuilding a 
virtual nullity. The sense of the provision is that Congress intended 
there to be independent lead time consideration for the distinct 
practice of engine rebuilding. In any case, as just explained, it is 
EPA's view that section 202(a)(3)(C) does not apply here.
(2) NHTSA Authority
    The Energy Policy and Conservation Act (EPCA) of 1975 mandates a 
regulatory program for motor vehicle fuel economy to meet the various 
facets of the need to conserve energy. In December 2007, Congress 
enacted the Energy Independence and Security Act (EISA), amending EPCA 
to require, among other things, the creation of a medium- and heavy-
duty fuel efficiency program for the first time.
    Statutory authority for the fuel consumption standards in this 
final rule is found in EISA section 103, 49 U.S.C. 32902(k). This 
section authorizes a fuel efficiency improvement program, designed to 
achieve the maximum feasible improvement to be created for commercial 
medium- and heavy-duty on-highway vehicles and work trucks, to include 
appropriate test methods, measurement metrics, standards, and 
compliance and enforcement protocols that are appropriate, cost-
effective and technologically feasible.
    NHTSA has responsibility for fuel economy and consumption 
standards, and assures compliance with EISA through rulemaking, 
including standard-setting; technical reviews, audits and studies; 
investigations; and enforcement of implementing regulations including 
penalty actions. This rule continues to fulfill the requirements of 
section 103 of EISA, which instructs NHTSA to create a fuel efficiency 
improvement program for ``commercial medium- and heavy-duty on-highway 
vehicles and work trucks'' by rulemaking, which is to include 
standards, test methods, measurement metrics, and enforcement 
protocols. See 49 U.S.C. 32902(k)(2).
    Congress directed that the standards, test methods, measurement 
metrics, and compliance and enforcement protocols be ``appropriate, 
cost-effective, and technologically feasible'' for the vehicles to be 
regulated, while achieving the ``maximum feasible improvement'' in fuel 
efficiency. NHTSA has broad discretion to balance the statutory factors 
in section 103 in developing fuel consumption standards to achieve the 
maximum feasible improvement.
    As discussed in the Phase 1 final rule, NHTSA has determined that 
the five year statutory limit on average fuel economy standards that 
applies to passengers and light trucks is not applicable to the HD 
vehicle and engine standards. As a result, the Phase 1 HD engine and 
vehicle standards remain in effect indefinitely at their 2018 or 2019 
MY levels until amended by a future rulemaking action. As was 
contemplated in that rule, NHTSA is finalizing a Phase 2 rulemaking 
action. Therefore, the Phase 1 standards will not remain in effect at 
their 2018 or 2019 MY levels indefinitely; they will remain in effect 
until the MY Phase 2 standards begin. In accordance with section 103 of 
EISA, NHTSA will ensure that not less than four full MYs of regulatory 
lead-time and three full MYs of regulatory stability are provided for 
in the Phase 2 standards.
    With respect to the proposal, many stakeholders opined in their 
comments as to NHTSA's legal authority to issue the Phase 2 medium- and 
heavy-duty standards (Phase 2 standards), in whole or in part. NHTSA 
addresses these comments in the following discussion.
    Allison Transmission, Inc. (Allison) questioned NHTSA's authority 
to issue the Phase 2 Standards. Allison stated that the Energy 
Independence and Security Act of 2007 (EISA) \96\ directs NHTSA to 
undertake ``a rulemaking proceeding,'' (emphasis added) predicated on a 
study by the National Academy of Sciences (NAS). Allison and the Truck 
Trailer Manufacturers Association (TTMA) asserted that because NAS has 
published a study on medium- and heavy duty vehicles and NHTSA 
promulgated the Phase 1 medium- and heavy-duty vehicle standards (Phase 
1 standards), NAS and NHTSA have fulfilled their statutory duties under 
EISA. Thus, Allison stated, NHTSA has no authority to issue standards 
beyond the Phase 1 standards.
---------------------------------------------------------------------------

    \96\ Public Law 110-140, 121 Stat. 1492. (December 19, 2007).
---------------------------------------------------------------------------

    NHTSA maintains that EISA allows the agency to promulgate medium- 
and heavy duty fuel efficiency standards beyond the Phase 1 standards. 
EISA states that NHTSA: \97\
---------------------------------------------------------------------------

    \97\ By delegation at 49 CFR 1.95(a). For purposes of this NPRM, 
grants of authority from EISA to the Secretary of Transportation 
regarding fuel efficiency will be referred to as grants of authority 
to NHTSA, as NHTSA has been delegated the authority to implement 
these programs.

by regulation, shall determine in a rulemaking proceeding how to 
implement a commercial medium- and heavy-duty on-highway vehicle and 
work truck fuel

[[Page 73520]]

efficiency program designed to achieve the maximum feasible 
improvement, and shall adopt and implement appropriate test methods, 
measurement metrics, fuel economy standards, and compliance and 
enforcement protocols . . . for commercial medium- and heavy-duty 
on-highway vehicles and work trucks.\98\
---------------------------------------------------------------------------

    \98\ Public Law 110-140, 121 Stat. 1492, Section 108. Codified 
at 49 U.S.C. 32902(k)(2).

    Allison equates the process by which Congress specified NHTSA 
promulgate standards--a rulemaking proceeding--to mean a limitation or 
constraint on NHTSA's ability to create, amend, or update the medium- 
and heavy duty fuel efficiency program. NHTSA believes the charge in 49 
U.S.C. 32902(k)(2) discusses ``a rulemaking proceeding'' only insofar 
as the statute specifies the process by which NHTSA would create a 
medium- and heavy-duty on-highway vehicle and work truck fuel 
efficiency improvement program and its associated standards.
    Allison and TTMA commented that EISA only refers to an initial NAS 
study, meaning EISA only specified that NHTSA issue one set of 
standards based on that study. As NHTSA stated in the NPRM, EISA 
requires NAS to issue updates to the initial report every five years 
through 2025.\99\ With that in mind, NAS issued an interim version of 
its first update to inform the Phase 2 NPRM. EISA's requirement that 
NAS update its initial report, which examines existing and potential 
fuel efficiency technologies that can practically be integrated into 
medium- and heavy-duty vehicles, is consistent with the conclusion that 
EISA intended the medium- and heavy-duty standards to function as part 
of an ongoing program \100\ and not a single rulemaking.
---------------------------------------------------------------------------

    \99\ 80 FR 40512 (July 13, 2015).
    \100\ ``. . . the Secretary . . . shall determine in a 
rulemaking proceeding how to implement a commercial medium- and 
heavy-duty on-highway vehicle and work truck fuel efficiency program 
designed to achieve the maximum feasible improvement . . .'' 49 
U.S.C. 42902(k)(2).
---------------------------------------------------------------------------

    Allison also noted that the language in EISA discussing lead time 
and stability refers to a single medium- and heavy-duty on-highway 
vehicle and work truck fuel economy standard.\101\ NHTSA believes the 
language highlighted by Allison serves the purpose of noting that each 
medium- and heavy-duty segment standard included in its program shall 
have the requisite amount of lead-time and stability. As discussed in 
49 U.S.C. 32902(k)(2), ``[t]he Secretary may prescribe separate 
standards for different classes of vehicles . . .'' Since NHTSA has 
elected to set standards for particular classes of vehicles, this 
language ensures each particular standard shall have the appropriate 
lead-time and stability required by EISA.
---------------------------------------------------------------------------

    \101\ 49 U.S.C. 32902(k)(3) states that, ``The commercial 
medium- and heavy-duty on-highway vehicle and work truck fuel 
economy standard adopted pursuant to this subsection shall provide 
not less than--(A) 4 full model years of regulatory lead-time; and 
(B) 3 full model years of regulatory stability.''
---------------------------------------------------------------------------

    TTMA asserted that NHTSA has no more than 24 months from the 
completion of the NAS study to issue regulations related to the medium- 
and heavy-duty program and therefore regulations issued after 2013 
``lack congressional authorization.'' This argument significantly 
misinterprets the Congressional purpose of this provision. Section 
32902(k)(2) requires that, 24 months after the completion of the NAS 
study, NHTSA begin implementing through a rulemaking proceeding a 
commercial medium- and heavy-duty on-highway vehicle and work truck 
fuel efficiency improvement program. Congress therefore authorized 
NHTSA to implement through rulemaking a ``program,'' which the 
dictionary defines as ``a plan of things that are done in order to 
achieve a specific result.'' \102\ Contrary to TTMA's assertion, 
Congress did not limit NHTSA to the establishment of one set of 
regulations, nor did it in any way limit NHTSA's ability to update and 
revise this program. The purpose of the 24 month period was simply to 
ensure that NHTSA exercised this authority expeditiously after the NAS 
study, which NHTSA accomplished by implementing the first phase of its 
fuel efficiency program in 2011.\103\ Today's rulemaking merely 
continues this program and clearly comports with the statutory language 
in 49 U.S.C. 32902(k). Further, the specific result sought by Congress 
in establishing the medium- and heavy-duty fuel efficiency program was 
a program focused on continuing fuel efficiency improvements. 
Specifically, Congress emphasized that the fuel efficiency program 
created by NHTSA be ``designed to achieve the maximum feasible 
improvement,'' allowing NHTSA to ensure the regulations implemented 
throughout the program encourage regulated entities to achieve the 
maximum feasible improvements. Congress did not limit, restrict, or 
otherwise suggest that the phrase ``designed to achieve the maximum 
feasible improvement'' be confined to the issuance of one set of 
standards. NHTSA actions are, therefore, clearly consistent with the 
authority conferred upon it in 49 U.S.C. 32902(k).
---------------------------------------------------------------------------

    \102\ ``Program.'' Merriam-Webster (2016 http://www.merriam-webster.com/dictionary/program (last accessed July 19, 2016).
    \103\ 76 FR 57016 (September 15, 2011).
---------------------------------------------------------------------------

    POP Diesel stated that the word ``fuel'' has not been defined by 
Congress, and therefore NHTSA should use its authority to define the 
term ``fuel'' as ``fossil fuel,'' allowing the agencies to assess fuel 
efficiency based on the carbon content of the fuels used in an engine 
or vehicle. Congress has already defined the term ``fuel'' in 49 U.S.C. 
32901(a)(10) as gasoline, diesel oil, or other liquid or gaseous fuel 
that the Secretary decides to include. As Congress has already spoken 
to the definition of fuel, it would be inappropriate for the agency to 
redefine ``fuel'' as ``fossil fuel.''
    Additionally, POP Diesel asserted that NHTSA's metric for measuring 
fuel efficiency is contrary to the mandate in EISA. Specifically, POP 
Diesel stated that many dictionaries define ``efficiency'' as a ratio 
of work performed to the amount of energy used, and NHTSA's load 
specific fuel consumption metric runs afoul of the plain meaning of 
statute the Phase 2 program implements. POP Diesel noted that 
Congressional debate surrounding what is now codified at 49 U.S.C. 
32902(k)(2) included a discussion that envisioned NHTSA and EPA having 
separate regulations, despite having overlapping jurisdiction.
    NHTSA continues to believe its use of load specific fuel 
consumption is an appropriate metric for assessing fuel efficiency as 
mandated by Congress. 49 U.S.C. 32902(k)(2) states, as POP Diesel 
noted, that NHTSA shall develop a medium- and heavy-duty fuel 
efficiency program. The section further states that NHTSA ``. . . shall 
adopt and implement appropriate test methods [and] measurement metrics 
. . . for commercial medium- and heavy-duty on-highway vehicles and 
work trucks.'' In the Phase 1 rulemaking, NHTSA, aided by the National 
Academies of Sciences (NAS) report, assessed potential metrics for 
evaluating fuel efficiency. NHTSA found that fuel economy would not be 
an appropriate metric for medium- and heavy-duty vehicles. Instead, 
NHTSA chose a metric that considers the amount of fuel consumed when 
moving a ton of freight (i.e., performing work).\104\ This metric, 
delegated by Congress to NHTSA to formulate, is not precluded by the 
text of the statute. It is a reasonable way by which to measure fuel 
efficiency for a program designed to reduce fuel consumption.
---------------------------------------------------------------------------

    \104\ See: 75 FR 74180 (November 30, 2010).

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

[[Page 73521]]

(a) NHTSA's Authority To Regulate Trailers
    As contemplated in the Phase 1 proposed and final rules, the 
agencies proposed standards for trailers in the Phase 2 rulemaking. 
Because Phase 1 did not include standards for trailers, NHTSA did not 
discuss its authority for regulating them in the proposed or final 
rules; that authority is described here.
    NHTSA is finalizing fuel efficiency standards applicable to heavy-
duty trailers as part of the Phase 2 program. NHTSA received several 
comments on the proposal relating to the agency's statutory authority 
to issue standards for trailers as part of the Phase 2 program. In 
particular, TTMA commented that NHTSA does not have the authority to 
regulate trailers as part of the medium- and heavy-duty standards. TTMA 
took issue with NHTSA's use of the National Traffic and Motor Vehicle 
Safety Act as an aid in defining an undefined term in EISA. 
Additionally, TTMA stated that EISA's use of GVWR instead of gross 
combination weight rating (GCWR) to define the vehicles subject to 
these regulations was intended to exclude trailers from the regulation.
    As stated in the proposal, EISA directs NHTSA to ``determine in a 
rulemaking proceeding how to implement a commercial medium- and heavy-
duty on-highway vehicle and work truck fuel efficiency improvement 
program designed to achieve the maximum feasible improvement . . . .'' 
\105\ EISA defines a commercial medium- and heavy-duty on-highway 
vehicle to mean ``an on-highway vehicle with a GVWR of 10,000 lbs or 
more.'' A ``work truck'' is defined as a vehicle between 8,500 and 
10,000 lbs GVWR that is not an MDPV. These definitions do not 
explicitly exclude trailers, in contrast to MDPVs. Because Congress did 
not act to exclude trailers when defining these terms by GVWRs, despite 
demonstrating the ability to exclude MDPVs, it is reasonable to 
interpret the provision to include them.
---------------------------------------------------------------------------

    \105\ 49 U.S.C. 42902(k)(2).
---------------------------------------------------------------------------

    Both the tractor and the trailer are vehicles subject to regulation 
by NHTSA in the Phase 2 program. Although EISA does not define the term 
``vehicle,'' NHTSA's authority to regulate motor vehicles under its 
organic statute, the Motor Vehicle Safety Act (``Safety Act''), does. 
The Safety Act defines a motor vehicle as ``a vehicle driven or drawn 
by mechanical power and manufactured primarily for use on public 
streets, roads, and highways. . . .'' \106\ NHTSA clearly has authority 
to regulate trailers under this Act as they are vehicles that are drawn 
by mechanical power--in this instance, a tractor engine--and NHTSA has 
exercised that authority numerous times.\107\ Given the absence of any 
apparent contrary intent on the part of Congress in EISA, NHTSA 
believes it is reasonable to interpret the term ``vehicle'' as used in 
the EISA definitions to have a similar meaning that includes trailers.
---------------------------------------------------------------------------

    \106\ 49 U.S.C. 30102(a)(6).
    \107\ See, e.g., 49 CFR 571.106 (Standard No. 106; Brake hoses); 
49 CFR 571.108 (Standard No. 108; Lamps, reflective devices, and 
associated equipment); 49 CFR 571.121 (Standard No. 121; Air brake 
systems); 49 CFR 571.223 (Standard No. 223; Rear impact guards).
---------------------------------------------------------------------------

    Additionally, it is worth noting that the dictionary definition of 
``vehicle'' is ``a machine used to transport goods or persons from one 
location to another.'' \108\ A trailer is a machine designed for the 
purpose of transporting goods. With these foregoing considerations in 
mind, NHTSA interprets its authority to regulate commercial medium- and 
heavy-duty on-highway vehicles, including trailers.
---------------------------------------------------------------------------

    \108\ ``Vehicle.'' Merriam-Webster (2016). http://www.merriam-webster.com/dictionary/vehicle (last accessed May 20, 2016).
---------------------------------------------------------------------------

    TTMA pointed to language in the Phase 1 NPRM where the agencies 
stated that GCWR included the weight of a loaded trailer and the 
vehicle itself. TTMA interprets this language to mean that standards 
applicable to vehicles defined by GVWR must inherently exclude 
trailers. The language TTMA cited is a clarification from a footnote in 
an introductory section describing the heavy-duty trucking industry. 
This statement was not a statement of NHTSA's legal authority over 
medium- and heavy-duty vehicles. NHTSA continues to believe a trailer 
is a vehicle under EISA if its GVWR fits within the definitions in 49 
U.S.C. 32901(a), and is therefore subject to NHTSA's applicable fuel 
efficiency regulations.
    Finally, in a comment on the Notice of Data Availability, TTMA 
stated that because NHTSA's statutory authority instructs the agency to 
develop a fuel efficiency program for medium- and heavy-duty on-highway 
vehicles, and trailers themselves do not consume fuel, trailers cannot 
be regulated for fuel efficiency. The agency disagrees with this 
assertion. A tractor-trailer is designed for the purpose of holding and 
transporting goods. While heavy-duty trailers themselves do not consume 
fuel, they are immobile and inoperative without a tractor providing 
motive power. Inherently, trailers are designed to be pulled by a 
tractor, which in turn affects the fuel efficiency of the tractor-
trailer as a whole. As previously discussed, both a tractor and trailer 
are motor vehicles under NHTSA's authority. Therefore it is reasonable 
to consider all of a tractor-trailer's parts--the engine, the cab-
chassis, and the trailer--as parts of a whole. As such they are all 
parts of a vehicle, and are captured within the scope of NHTSA's 
statutory authority. As EPA describes above, the tractor and trailer 
are both incomplete without the other. Neither can fulfill the function 
of the vehicle without the other. For this reason, and the other 
reasons stated above, NHTSA interprets its authority to regulate 
commercial medium- and heavy-duty on-highway vehicles, including 
tractor-trailers, as encompassing both tractors and trailers.
(b) NHTSA's Authority To Regulate Recreational Vehicles
    NHTSA did not regulate recreational vehicles as part of the Phase 1 
medium- and heavy-duty fuel efficiency standards, although EPA did 
regulate them as vocational vehicles for GHG emissions. In the Phase 1 
NPRM, NHTSA interpreted ``commercial medium- and heavy duty on-road 
vehicle'' to mean that recreational vehicles, such as motor homes, were 
not to be included within the program because recreational vehicles are 
not commercial. Following comments to the Phase 1 proposal, NHTSA 
reevaluated its statutory authority and proposed that recreational 
vehicles be included in the Phase 2 standards, and that early 
compliance be allowed for manufacturers who want to certify during the 
Phase 1 period.
    The Recreational Vehicle Industry Association (RVIA) and Newell 
Coach Corporation (Newell) asserted that NHTSA does not have the 
authority to regulate recreational vehicles (RVs). RVIA and Newell 
stated that NHTSA's authority under EISA is limited to commercial 
medium- and heavy-duty vehicles and that RVs are not commercial. RVIA 
pointed to the fact that EISA gives NHTSA fuel efficiency authority 
over ``commercial medium- and heavy-duty vehicles'' and ``work 
trucks,'' the latter of which is not prefaced with the word 
``commercial.'' Because of this difference, RVIA argued that NHTSA is 
ignoring a limitation on its authority--that is, that NHTSA only has 
authority over medium- and heavy-duty vehicles that are commercial in 
nature. RVIA stated that RVs are not used for commercial purposes, and 
are therefore not subject to Phase 2.
    NHTSA's authority to regulate medium- and heavy-duty vehicles under 
EISA extends to ``commercial medium- and heavy-duty on-highway 
vehicles''

[[Page 73522]]

and ``work truck[s].'' \109\ If terms in the statute are defined, NHTSA 
must apply those definitions. Both terms highlighted by RVIA have been 
defined in EISA, therefore, NHTSA will use their defined meanings. 
``Work truck'' means a vehicle that is rated between 8,500 and 10,000 
pounds GVWR and is not an MDPV.\110\ ``Commercial medium- and heavy-
duty on-road highway vehicle'' means an on-highway vehicle with a gross 
vehicle weight rating (GVWR) of 10,000 pounds or more.\111\ Based on 
the definitions in EISA, recreational vehicles would be regulated as 
class 2b-8 vocational vehicles. Neither statutory definition requires 
that those vehicles encompassed be commercial in nature, instead 
dividing the medium- and heavy-duty segments based on weight. The 
definitions of ``work truck'' and ``commercial medium- and heavy-duty 
on-highway vehicles'' collectively encompass the on-highway motor 
vehicles not covered in the light duty CAFE standards.
---------------------------------------------------------------------------

    \109\ 49 U.S.C. 42902(k)(2).
    \110\ 49 U.S.C. 42901(a)(19).
    \111\ 49 U.S.C. 42901(a)(7).
---------------------------------------------------------------------------

    RVIA further stated that NHTSA's current fuel efficiency 
regulations are not consistent with EISA and do not purport to grant 
NHTSA authority to regulate vehicles simply based on weight. NHTSA's 
regulations at 49 CFR 523.6 define, by cross-reference the language in 
49 U.S.C. 32901(a)(7) and (19), and consistent with the discussion 
above, include recreational vehicles.
    Finally, NHTSA notes that excluding recreational vehicles in Phase 
2 could create illogical results, including treating similar vehicles 
differently, as determinations over whether a given vehicle would be 
covered by the program would be based upon either its intended or 
actual use, rather than the actual characteristics of the vehicle. 
Moreover, including recreational vehicles under NHTSA regulations 
furthers the agencies' goal of one national program, as EPA regulations 
will continue to regulate recreational vehicles. NHTSA will allow early 
compliance for manufacturers that want to certify during the Phase 1 
period.

F. Other Issues

    In addition to establishing new Phase 2 standards, this document 
addresses several other issues related to those standards. The agencies 
are adopting some regulatory provisions related to the Phase 1 program, 
as well as amendments related to other EPA and NHTSA regulations. These 
other issues are summarized briefly here and discussed in greater 
detail in later sections.
(1) Opportunities for Further Oxides of Nitrogen (NOX) 
Reductions From Heavy-Duty On-Highway Engines and Vehicles
    The EPA has the authority under section 202 of the Clean Air Act to 
establish, and from time to time revise, emission standards for certain 
air pollutants emitted from heavy-duty on-highway engines and vehicles. 
The emission standards that EPA has developed for heavy-duty on-highway 
engines have become progressively more stringent over the past 40 
years, with the most recent NOX standards for new heavy-duty 
on-highway engines fully phased in with the 2010 model year. 
NOX emissions standards for heavy-duty on-highway engines 
have contributed significantly to the overall reduction in the national 
NOX emissions inventory. Nevertheless, a need for additional 
NOX reductions remains, particularly in areas of the country 
with elevated levels of air pollution. As discussed further below, in 
response to EPA's responsibilities under the Clean Air Act, the 
significant comments we received on this topic during the public 
comment period, the recent publication by the California Air Resources 
Board (CARB) of its May 2016 Mobile Source Strategy report and Proposed 
2016 Strategy for the State implementation Plan \112\ and a recent 
Petition for Rulemaking,\113\ EPA plans to further engage with 
stakeholders after the publication of this Final Rule to discuss the 
opportunities for developing more stringent federal standards to 
further reduce the level of NOX emissions from heavy-duty 
on-highway engines through a coordinated effort with CARB.
---------------------------------------------------------------------------

    \112\ See ``Mobile Source Strategy,'' May 16, 2016 from CARB. 
Available at: http://www.arb.ca.gov/planning/sip/2016sip/2016mobsrc.htm and ``Proposed 2016 State Strategy for the State 
Implementation Plan,'' May 17, 2016 from CARB. Available at http://www.arb.ca.gov/planning/sip/2016sip/2016sip.htm.
    \113\ EPA received a Petition for Rulemaking to adopt new 
NOX emission standards for on-road heavy-duty trucks and 
engines on June 3, 2016 from the South Coast Air Quality Management 
District, the Arizona Pima County Department of Environmental 
Quality, the Bay Area Air Quality Management District, the 
Connecticut Department of Energy and Environmental Protection 
Agency, the Delaware Department of Energy and Environmental 
Protection, the Nevada Washoe County Health District, the New 
Hampshire Department of Environmental Services, the New York City 
Department of Environmental Protection, the Akron Regional Air 
Quality Management District of Akron, Ohio, the Washington State 
Department of Ecology, and the Puget Sound Clean Air Agency.
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    NOX is one of the major precursors of tropospheric ozone 
(ozone), exposure to which is associated with a number of adverse 
respiratory and cardiovascular effects, as described in Section 
VIII.A.2 below. These effects are particularly pronounced among 
children, the elderly, and among people with lung disease such as 
asthma. NOX is also a major contributor to secondary 
PM2.5 formation, and exposure to PM2.5 itself has 
been linked to a number of adverse health effects (see Section 
VIII.A.1), such as heart attacks and premature mortality. In addition, 
NO2 exposure is linked to asthma exacerbation and possibly 
to asthma development in children (see Section VIII.A.3). EPA has 
already adopted many emission control programs that are expected to 
reduce ambient ozone levels. However, the U.S. Energy Information 
Administration's AEO 2015 predicts that vehicles miles travelled (VMT) 
for heavy-duty trucks will increase in the coming years,\114\ and even 
with the implementation of all current state and federal regulations, 
some of the most populous counties in the United States are expected to 
have ozone air quality that exceeds the National Ambient Air Quality 
Standards (NAAQS) into the future. As of April 22, 2016, there were 44 
ozone nonattainment areas for the 2008 ozone NAAQS composed of 216 full 
or partial counties, with a population of more than 120 million. These 
nonattainment areas are dispersed across the country, with counties in 
the west, northeastern United States, Texas, and several Great Lakes 
states. The geographic diversity of this problem necessitates action at 
the national level. In California, the San Joaquin Valley and the South 
Coast Air Basin are highly-populated areas classified as ``extreme 
nonattainment'' for the 2008 8-hour ozone standard, with an attainment 
demonstration deadline of 2031 (one year in advance of the actual 2032 
attainment date). In addition, EPA lowered the level of the primary and 
secondary NAAQS for the 8-hour standards from 75 ppb to 70 ppb in 2015 
(2015 ozone NAAQS),\115\ with plans to finalize nonattainment 
designations for the 2015 ozone NAAQS in October 2017. Further 
NOX reductions would provide reductions in ambient ozone 
levels, helping to prevent adverse health impacts associated with ozone 
exposure and assisting states and local areas in attaining and 
maintaining the applicable ozone NAAQS. Reductions in NOX 
emissions would also improve air quality and provide

[[Page 73523]]

public health and welfare benefits throughout the country by (1) 
reducing PM formed by reactions of NOX in the atmosphere; 
(2) reducing concentrations of the criteria pollutant NO2; 
(3) reducing nitrogen deposition to sensitive environments; and (4) 
improving visibility.
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    \114\ US Energy Information Administration. Annual Energy 
Outlook 2015. April 2015. Page E-8. http://www.eia.gov/forecasts/aeo/pdf/0383(2015).pdf.
    \115\ 80 FR 65292 (Oct. 26, 2015).
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    In the past year, EPA has received requests from several state and 
local air quality districts and other organizations asking that EPA 
establish more stringent NOX standards for heavy-duty on-
highway engines to help reduce the public's exposure to air pollution. 
In its comments, CARB estimated that heavy-duty on-highway vehicles 
currently contribute about one-third of all NOX emissions in 
California. In order to achieve the 2008 ozone NAAQS, California has 
estimated that the state's South Coast Air Basin will need an 80 
percent reduction in NOX emissions by 2031. California has 
the unique ability among states to adopt its own separate new motor 
engine and vehicle emission standards under section 209 of the CAA; 
however, CARB commented that EPA action to establish a new federal low-
NOX standard for heavy-duty trucks is critical, since 
California standards alone are not sufficient to demonstrate compliance 
with either the 2008 ozone NAAQS or the 2015, even more stringent ozone 
NAAQS. CARB has developed a comprehensive mobile source strategy which 
for heavy-duty on-highway vehicles includes: Lowering the emissions 
from the in-use fleet; establishing more stringent NOX 
standards for new engines; and accelerating the deployment of zero and 
near-zero emissions technology.\116\ In September of 2015, CARB 
published a draft of this strategy, Mobile Source Strategy Discussion 
Draft, after which CARB held a public workshop and provided opportunity 
for public comment. On May 16, 2016, CARB issued a final Mobile Source 
Strategy report.\117\ In this report, CARB provides a comprehensive 
strategy plan for the future of mobile sources and goods movement in 
the State of California for how mobile sources in California can meet 
air quality and climate goals over the next fifteen years. Among the 
many programs discussed are plans for a future on-highway heavy-duty 
engine and vehicle NOX control regulatory program for new 
products with implementation beginning in 2024. CARB states ``The need 
for timely action by U.S. EPA to establish more stringent engine 
performance standards in collaboration with California efforts is 
essential. About 60 percent of total heavy-duty truck VMT in the South 
Coast on any given day is accrued by trucks purchased outside of 
California, and are exempt from California standards. U.S. EPA action 
to establish a federal low-NOX standard for trucks is critical.'' CARB 
lays out a time line for a California specific action for new highway 
heavy-duty NOX standards with CARB action in 2017-2019 that 
would lead to new standards that could begin with the model year 2023. 
CARB also requests that the U.S. EPA work on a Federal rulemaking 
action in the 2017-2019 time frame which could result in standards that 
could begin with the model year 2024. The CARB Mobile Source Strategy 
document also states ``Due to the preponderance of interstate 
trucking's contribution to in-state VMT, federal action would be far 
more effective at reducing in-state emissions than a California-only 
standard. However, California is prepared to develop a California-only 
standard, if needed, to meet federal attainment targets.'' CARB goes on 
to state ``[C]ARB will begin development of new heavy-duty low 
NOX emission standard in 2017 with Board action expected in 
2019. ARB may also petition U.S. EPA in 2016 to establish new federal 
heavy-duty engine emission standards . . . . If U.S. EPA begins the 
regulatory development process for a new federal heavy-duty emission 
standard by 2017, ARB will coordinate its regulatory development 
efforts with the federal regulation.'' On May 17, 2016, CARB published 
its ``Proposed 2016 State Strategy for the State Implementation Plan.'' 
\118\ This document contains CARB staff's proposed strategy to attain 
the health-based federal air quality standards over the next fifteen 
years. With respect to future on-highway heavy-duty NOX 
standards, the proposed State Implementation Plan is fully consistent 
with the information published by CARB in the Mobile Source Strategy 
report. EPA intends to work with CARB to consider the development of a 
new harmonized Federal and California program that would apply lower 
NOX emissions standards at the national level to heavy-duty 
on-highway engines and vehicles.
---------------------------------------------------------------------------

    \116\ To foster the development of the next generation of lower 
NOX engines, in 2013, CARB adopted optional low-
NOX heavy-duty engine standards ranging from 0.10 down to 
0.02 grams per brake horsepower-hour (g/bhp-hr). CARB also funded 
over $1 million to a low-NOX engine research and 
demonstration project at Southwest Research Institute (SwRI).
    \117\ See ``Mobile Source Strategy,'' May 16, 2016 from CARB. 
Available at: http://www.arb.ca.gov/planning/sip/2016sip/2016mobsrc.htm.
    \118\ See ``Proposed 2016 State Strategy for the State 
Implementation Plan,'' May 17, 2016 from CARB. Available at http://www.arb.ca.gov/planning/sip/2016sip/2016sip.htm.
---------------------------------------------------------------------------

    In addition to CARB, EPA received compelling letters and comments 
from the National Association of Clean Air Agencies, the Northeast 
States for Coordinated Air Use Management, the Ozone Transport 
Commission, and the South Coast Air Quality Management District 
explaining the critical and urgent need to reduce NOX 
emissions that significantly contribute to ozone and fine particulate 
air quality problems in their represented areas. The comments describe 
the challenges many areas face in meeting both the 2008 and recently 
strengthened 2015 ozone NAAQS. These organizations point to the 
significant contribution of heavy-duty vehicles to NOX 
emissions in their areas, and call upon EPA to begin a rulemaking to 
require further NOX controls for the heavy-duty sector as 
soon as possible. Commenters such as the American Lung Association, 
Environmental Defense Fund, Union of Concerned Scientists, the 
California Interfaith Power and Light, Coalition for Clean Air/
California Cleaner Freight Coalition, and the Moving Forward Network 
similarly describe the air quality and public health need for 
NOX reductions and request EPA to lower NOX 
emissions standards for heavy-duty vehicles. Taken as a whole, the 
numerous comments, the expected increase in heavy-duty truck VMT, and 
the fact that ozone challenges will remain across the country 
demonstrate the critical need for more stringent nationwide 
NOX emissions standards. Such standards are vital to 
improving air quality nationwide and reducing public health effects 
associated with exposure to ozone and secondary PM2.5, 
especially for vulnerable populations and in highly impacted regions.
    On June 3, 2016, the EPA received a Petition for Rulemaking from 
the South Coast Air Quality Management District (California), the Pima 
County Department of Environmental Quality (Arizona), the Bay Area Air 
Quality Management District (California), the Connecticut Department of 
Energy and Environmental Protection Agency, the Delaware Department of 
Energy and Environmental Protection, the Washoe County Health District 
(Nevada), the New Hampshire Department of Environmental Services, the 
New York City Department of Environmental Protection, the Akron 
Regional Air Quality Management District (Ohio), the Washington State 
Department of Ecology, and the Puget Sound Clean Air

[[Page 73524]]

Agency (Washington).119 120 In a June 15, 2016 letter to 
EPA, the Commonwealth of Massachusetts also joined this petition. On 
June 22, 2016, the San Joaquin Valley Air Pollution Control District 
(California) also submitted a petition for rulemaking to EPA.\121\ In 
these Petitions, the Petitioners request that EPA establish a new, 
lower NOX emission standard for on-road heavy-duty engines. 
The Petitioners request that EPA implement a new standard by January 1, 
2022, and that EPA establish this new standard through a Final 
Rulemaking issued by December 31, 2017. EPA is not formally responding 
to this Petition in this Final Rule, but we will do so in a future 
action. In the petitions, the Petitioners include a detailed discussion 
of their views and underlying data regarding the need for large scale 
reduction in NOX emissions from heavy-duty engines, why they 
believe new standards can be achieved, and their legal views on EPA's 
responsibilities under the Clean Air Act.
---------------------------------------------------------------------------

    \119\ http://4cleanair.org/sites/default/files/resources/HD_Ultra-Low-NOX_Petition_to_EPA-060316.pdf.
    \120\ http://4cleanair.org/sites/default/files/resources/Petition_Attachments-Ultra-Low-NOX_Petition_to_EPA-060316_0.pdf.
    \121\ http://www.valleyair.org/recent_news/Media_releases/2016/PR-District-Petitions-Federal-Government-06-22-16.pdf.
---------------------------------------------------------------------------

    Since the establishment of the current heavy-duty on-highway 
standards in January of 2001,\122\ there has been continued progress in 
emissions control technology. EPA and CARB are currently investing in 
research to evaluate opportunities for further NOX 
reductions from heavy-duty on-highway vehicles and engines. Programs 
and research underway at CARB, as well as a significant body of work in 
the technical literature, indicate that reducing NOX 
emissions significantly below the current on-highway standard of 0.20 
grams per brake horsepower-hour (g/bhp-hr) is potentially 
feasible.123 124 Opportunities for additional NOX 
reductions include reducing emissions over cold start operation as well 
as low-speed, low-load off-cycle operation. Reductions are being 
accomplished through the use of improved engine management, advanced 
aftertreatment technologies (improvements in SCR catalyst design/
formulation), catalyst positioning, aftertreatment thermal management, 
and heated diesel exhaust fluid dosing. At the same time, the effect of 
these new technologies on cost and GHG emissions is being carefully 
evaluated,\124\ since it is important that any future NOX 
control technologies be considered in the context of the final Phase 2 
GHG standards. During the Phase 2 program public comment period, EPA 
received some comments stressing the need for careful evaluation of 
emerging NOX control technologies and urging EPA to consider 
the relationship between CO2 and NOX before 
setting lower NOX standards (commenters include American 
Trucking Association, Caterpillar, Daimler Trucks North America, 
Navistar Inc., PACCAR Inc., Volvo Group, Truck and Engine Manufacturers 
Association, Diesel Technology Forum, National Association of 
Manufacturers, and National Automobile Dealers Association). EPA also 
received comments pointing to advances in NOX emission 
control technologies that would lower NOX without reducing 
engine efficiency (commenters include Advanced Engine Systems 
Institute, Clean Energy, Manufacturers of Emission Controls 
Association, and Union of Concerned Scientists). EPA will continue to 
evaluate both opportunities and challenges associated with lowering 
NOX emissions from the current standards, and over the 
coming months we intend to engage with many stakeholders as we develop 
our response to the June 2016 Petitions for Rulemaking discussed above.
---------------------------------------------------------------------------

    \122\ 66 FR 5002 (January 18, 2001).
    \123\ See CARB's September 2015 Draft Technology Assessment: 
Lower NOX Heavy-Duty Diesel Engines, and Draft Technology 
Assessment: Low Emission Natural Gas and Other Alternative Fuel 
Heavy-Duty Engines.
    \124\ http://www.arb.ca.gov/research/veh-emissions/low-nox/low-nox.htm, 4/26/16. This low NOX study is in the process of 
selecting the emission reduction systems for final testing and it is 
expected that this demonstration program will be complete by the end 
of 2016.
---------------------------------------------------------------------------

    EPA believes the opportunity exists to develop, in close 
coordination with CARB and other stakeholders, a new, harmonized 
national NOX reduction strategy for heavy-duty on-highway 
engines which could include the following:
     Substantially lower NOX emission standards;
     Improvements to emissions warranties;
     Consideration of longer useful life, reflecting actual in-
use activity;
     Consideration of rebuilding/remanufacturing practices;
     Updated certification and in-use testing protocols;
     Incentives to encourage the transition to next-generation 
cleaner technologies as soon as possible;
     Improvements to test procedures and test cycles to ensure 
emission reductions occur in the real-world, not only over the 
applicable certification test cycles.
    Based on the air quality need, the requests described above, the 
continued progress in emissions control technology, and the June 2016 
petitions for rulemaking, EPA plans to engage with a range of 
stakeholders to discuss the opportunities for developing more stringent 
federal standards to further reduce the level of NOX 
emissions from heavy-duty on-highway engines, after the publication of 
this Final Rule. Recognizing the benefits of a nationally harmonized 
program and given California's unique ability under CAA section 209 to 
be allowed to regulate new motor vehicle and engine emission standards 
if certain criteria are met, EPA intends to work closely with CARB on 
this effort. EPA also intends to engage with truck and engine 
manufacturers, suppliers, state air quality agencies, NGOs, labor, the 
trucking industry, and the Petitioners over the next several months as 
we develop our formal response to the June 2016 Petitions for 
Rulemaking.
(2) Issues Related to Phase 2
(a) Natural Gas Engines and Vehicles
    This combined rulemaking by EPA and NHTSA is designed to regulate 
two separate characteristics of heavy duty vehicles and engines: GHGs 
and fuel consumption. In the case of diesel or gasoline powered 
vehicles, there is a one-to-one relationship between these two 
characteristics. For alternatively fueled vehicles, which use no 
petroleum, the situation is different. For example, a natural gas 
vehicle that achieves approximately the same fuel efficiency as a 
diesel powered vehicle will emit 20 percent less CO2; and a 
natural gas vehicle with the same fuel efficiency as a gasoline vehicle 
will emit 30 percent less CO2. Yet natural gas vehicles 
consume no petroleum. The agencies are continuing Phase 1 approach, 
which the agencies have previously concluded balances these facts by 
applying the gasoline and diesel CO2 standards to natural 
gas engines based on the engine type of the natural gas engine. Fuel 
consumption for these vehicles is then calculated according to their 
tailpipe CO2 emissions. In essence, this applies a one-to-
one relationship between fuel efficiency and tailpipe CO2 
emissions for all vehicles, including natural gas vehicles. The 
agencies determined that this approach will likely create a small 
balanced incentive for natural gas use. In other words, it created a 
small incentive for the use of natural gas engines that appropriately 
balanced concerns about the climate impact methane emissions against 
other factors such as the energy security

[[Page 73525]]

benefits of using domestic natural gas. See 76 FR 57123.
(b) Alternative Refrigerants
    In addition to use of low-leak components in air conditioning 
system design, manufacturers can also decrease the global warming 
impact of any refrigerant leakage emissions by adopting systems that 
use alternative, lower global warming potential (GWP) refrigerants, to 
replace the refrigerant most commonly used today, HFC-134a (R-134a). 
HFC-134a is a potent greenhouse gas with a GWP 1,430 times greater than 
that of CO2.
    Under EPA's Significant New Alternatives Policy (SNAP) 
Program,\125\ EPA has found acceptable, subject to use conditions, 
three alternative refrigerants that have significantly lower GWPs than 
HFC-134a for use in A/C systems in newly manufactured light-duty 
vehicles: HFC-152a, CO2 (R-744), and HFO-1234yf.\126\ HFC-
152a has a GWP of 124, HFO-1234yf has a GWP of 4, and CO2 
(by definition) has a GWP of 1, as compared to HFC-134a which has a GWP 
of 1,430.\127\ CO2 is nonflammable, while HFO-1234yf and 
HFC-152a are flammable. All three are subject to use conditions 
requiring labeling and the use of unique fittings, and where 
appropriate, mitigating flammability and toxicity. Currently, the SNAP 
listing for HFO-1234yf is limited to newly manufactured A/C systems in 
light-duty vehicles, whereas HFC-152a and CO2 have been 
found acceptable for all motor vehicle air conditioning applications, 
including heavy-duty vehicles.
---------------------------------------------------------------------------

    \125\ Section 612(c) of the Clean Air Act requires EPA to review 
substitutes for class I and class II ozone-depleting substances and 
to determine whether such substitutes pose lower risk than other 
available alternatives. EPA is also required to publish lists of 
substitutes that it determines are acceptable and those it 
determines are unacceptable. See http://www3.epa.gov/ozone/snap/refrigerants/lists/index.html, last accessed on March 5, 2015.
    \126\ Listed at 40 CFR part 82, subpart G.
    \127\ GWP values cited in this final action are from the IPCC 
Fourth Assessment Report (AR4) unless stated otherwise. Where no GWP 
is listed in AR4, GWP values are determined consistent with the 
calculations and analysis presented in AR4 and referenced materials.
---------------------------------------------------------------------------

    None of these alternative refrigerants can simply be ``dropped'' 
into existing HFC-134a air conditioning systems. In order to account 
for the unique properties of each refrigerant and address use 
conditions required under SNAP, changes to the systems will be 
necessary. Typically these changes will need to occur during a vehicle 
redesign cycle but can also occur during a refresh. For example, 
because CO2, when used as a refrigerant, is physically and 
thermodynamically very different from HFC-134a and operates at much 
higher pressures, a transition to this refrigerant would require 
significant hardware changes. A transition to A/C systems designed for 
HFO-1234yf, which is more thermodynamically similar to HFC-134a than is 
CO2, requires less significant hardware changes that 
typically include installation of a thermal expansion valve and can 
potentially require resized condensers and evaporators, as well as 
changes in other components. In addition, vehicle assembly plants 
require re-tooling in order to handle new refrigerants safely. Thus a 
change in A/C refrigerants requires significant engineering, planning, 
and manufacturing investments.
    EPA is not aware of any significant development of A/C systems 
designed to use alternative refrigerants in heavy-duty vehicles.\128\ 
However, all three lower GWP alternatives are in use or under various 
stages of development for use in LD vehicles. Of these three 
refrigerants, most manufacturers of LD vehicles have identified HFO-
1234yf as the most likely refrigerant to be used in that application. 
For that reason, EPA anticipates that HFO-1234yf will be a primary 
candidate for refrigerant substitution in the HD market in the future 
if it is listed as an acceptable substitute under SNAP for HD A/C 
applications.
---------------------------------------------------------------------------

    \128\ To the extent that some manufacturers produce HD pickups 
and vans on the same production lines or in the same facilities as 
LD vehicles, some A/C system technology commonality between the two 
vehicle classes may be developing.
---------------------------------------------------------------------------

    As mentioned above, EPA has listed as acceptable, subject to use 
conditions, two lower-GWP refrigerants, R-744 (CO2) and HFC-
152a, for use in HD vehicles. On April 18, 2016, EPA also proposed to 
list HFO-1234yf as acceptable, subject to use conditions, in A/C 
systems for newly manufactured MDPVs, HD pickup trucks, and complete HD 
vans (81 FR 22810). In that action, EPA proposed to list HFO-1234yf as 
acceptable, subject to use conditions, for those vehicle types for 
which human health and environmental risk could be assessed using the 
currently available risk assessments and analysis on LD vehicles. Also 
in that action, EPA requested ``information on development of HFO-
1234yf MVAC systems for other HD vehicle types or off-road vehicles, or 
plans to develop these systems in the future.'' EPA also stated ``This 
information may be used to inform a future listing'' (81 FR 22868).
    In another rulemaking action under the SNAP program, on July 20, 
2015, EPA published a final rule (80 FR 42870) that will change the 
listing status of HFC-134a to unacceptable for use in newly 
manufactured LD motor vehicles beginning in MY 2021 (except as allowed 
under a narrowed use limit for use in newly manufactured LD vehicles 
destined for use in countries that do not have infrastructure in place 
for servicing with other acceptable refrigerants through MY 2025). In 
that same rule, EPA listed the refrigerant blends SP34E, R-426A, R-
416A, R-406A, R-414A, R-414B, HCFC Blend Delta, Freeze 12, GHG-X5, and 
HCFC Blend Lambda as unacceptable for use in newly manufactured light-
duty vehicles beginning in MY 2017. EPA's decisions were based on the 
availability of other substitutes that pose less overall risk to human 
health and the environment, when used in accordance with required use 
conditions. Neither the April 2016 proposed rule nor the July 2015 
final rule consider a change of listing status for HFC-134a in HD 
vehicles.
    LD vehicle manufacturers are currently making investments in 
systems designed for lower-GWP refrigerants, both domestically and on a 
global basis. In support of the LD GHG rule, EPA projected a full 
transition of LD vehicles to lower-GWP alternatives in the United 
States by MY 2021. We expect the costs of transitioning to decrease 
over time as alternative refrigerants are adopted across all LD 
vehicles and trucks, in part due to increased availability of 
components and the continuing increases in refrigerant production 
capacity, as well as knowledge gained through experience. As lower-GWP 
alternatives become widely used in LD vehicles, some HD vehicle 
manufacturers may wish to also transition their vehicles. Transitioning 
could be advantageous for a variety of reasons, including platform 
standardization and company environmental stewardship policies.
    In the proposal for this Phase 2 HD rule, EPA proposed another 
action related to alternative refrigerants. EPA proposed to allow a 
manufacturer to be ``deemed to comply'' with the leakage standard if 
its A/C system used a refrigerant other than HFC-134a that was both 
listed as an acceptable substitute refrigerant for heavy-duty A/C 
systems under SNAP, and was identified in the LD GHG regulations at 40 
CFR 86.1867-12(e). 80 FR 40172. By slightly reducing the regulatory 
burden of compliance with the leakage standard for a manufacturer that 
used an alternative refrigerant, the ``deemed to comply'' provision was 
intended to provide a modest incentive for the use of such 
refrigerants. There were comments in support of this approach,

[[Page 73526]]

including from Honeywell and Chemours, both of which manufacture HFO-
1234yf.
    For several reasons, EPA has reconsidered the proposed ``deemed to 
comply'' provision for this rule, and instead, the Phase 2 program 
retains the Phase 1 requirement that manufacturers attest that they are 
using low-leak components, regardless of the refrigerant they use. CARB 
and several NGO commenters expressed concerns about the proposed 
``deemed to comply'' provision, primarily citing the potential for 
manufacturers to revert to less leak-tight components if they were no 
longer required to attest to the use of low-leak A/C system components 
because they used a lower-GWP refrigerant. In general, we expect that 
the progress LD vehicle manufacturers are making toward more leak-tight 
A/C systems will continue and that this progress will transfer to HD A/
C systems. Still, we agree that continued improvements in low-leak 
performance HD vehicles is an important goal, and that continuing the 
Phase 1 leakage requirements in the Phase 2 program should discourage 
manufacturers from reverting to higher-leak and potentially less 
expensive components. It is also important to note that there is no 
``deemed to comply'' option in the parallel LD-GHG program--
manufacturers must attest to meeting the leakage standard. There is no 
compelling reason to have a different regime for heavy duty 
applications.
    Although leakage of lower-GWP refrigerants is of less concern from 
a climate perspective than leakage of higher GWP refrigerants, we also 
agree with several commenters that expressed a concern related to the 
servicing of lower-GWP systems with higher-GWP refrigerants in the 
aftermarket. We agree that this could result due to factors such as 
price differentials between aftermarket refrigerants. However, as is 
the case for Phase 1, as a part of certification, HD manufacturers will 
attest both to the use of low-leak components as well as to the 
specific refrigerant used. Thus, in the future, a manufacturer wishing 
to certify a vehicle with an A/C system designed for an alternative 
refrigerant will attest to the use of that specific refrigerant. In 
that situation, any end-user servicing and recharging that A/C system 
with any other refrigerant would be considered tampering with an 
emission-related component under Title II of the CAA. For example, 
recharging an A/C system certified to use a lower-GWP refrigerant, such 
as HFO-1234yf, with any other refrigerant, including but not limited to 
HFC-134a, would be considered a violation of Title II tampering 
provisions.
    At the same time, EPA does not believe that finalizing the ``deemed 
to comply'' provision would have had an impact on any future transition 
of the HD industry to alternative refrigerants. As discussed above, two 
lower-GWP refrigerants are already acceptable for use in HD vehicles, 
and EPA has proposed to list HFO-1234yf as acceptable, subject to use 
conditions, for limited HD vehicle types. As also discussed above, and 
especially in light of the rapid expansion of alternative refrigerants 
that has been occurring in the LD vehicle market, similar trends may 
develop in the HD vehicle market, regardless of EPA's action regarding 
leakage of alternative refrigerants in this final rule.
(c) Small Business Issues
    The Regulatory Flexibility Act (RFA) generally requires an agency 
to prepare a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements under the Administrative 
Procedure Act or any other statute unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities. See generally 5 U.S.C. 601-612. The RFA 
analysis is discussed in Section XIV.
    Pursuant to section 609(b) of the RFA, as amended by the Small 
Business Regulatory Enforcement Fairness Act (SBREFA), EPA also 
conducted outreach to small entities and convened a Small Business 
Advocacy Review Panel to obtain advice and recommendations of 
representatives of the small entities that potentially will be subject 
to the rule's requirements. Consistent with the RFA/SBREFA 
requirements, the Panel evaluated the assembled materials and small-
entity comments on issues related to elements of the Initial Regulatory 
Flexibility Analysis (IRFA). A copy of the Panel Report was included in 
the docket for this rule.
    The agencies previously determined that the Phase 2 regulations 
could potentially have a significant economic impact on small entities. 
Specifically, the agencies identified four categories of directly 
regulated small businesses that could be impacted:

 Trailer Manufacturers
 Alternative Fuel Converters
 Vocational Chassis Manufacturers
 Glider Vehicle \129\ Assemblers
---------------------------------------------------------------------------

    \129\ Vehicles produced by installing a used engine into a new 
chassis are commonly referred to as ``gliders,'' ``glider kits,'' or 
``glider vehicles.'' See Section I.E.i and XIII.B.

    To minimize these impacts the agencies are adopting certain 
regulatory flexibilities--both general and category-specific. In 
general, we are delaying new requirements for EPA GHG emission 
standards by one initial year and simplifying certification 
requirements for small businesses. Even with this one year delay, small 
businesses will be required to comply with EPA's standards before 
NHTSA's fuel efficiency standards are mandatory. Because of this 
timing, compliance with NHTSA's regulations will not be delayed, as 
small business manufacturers will be accommodated through EPA's initial 
one year delay. The agencies are also providing the following specific 
relief:
     Trailers: Adopting simpler requirements for non-box 
trailers, which are more likely to be manufactured by small businesses; 
reduced reliance on emission averaging; and making third-party testing 
easier for certification.
     Alternative Fuel Converters: Omitting recertification of a 
converted vehicle when the engine is converted and certified; reduced 
N2O testing; and simplified onboard diagnostics and delaying 
required compliance with each new standard by one model year.
     Vocational Chassis: Less stringent standards for certain 
vehicle categories; opportunity to generate credits under the Phase 1 
program.
     Glider Vehicle Assemblers: \130\ Exempting existing small 
businesses, but limiting the small business exemption to a capped level 
of annual production (production in excess of the capped amount will be 
allowed, but subject to all otherwise applicable requirements including 
the Phase 2 standards). Providing additional flexibility for newer 
engines.
---------------------------------------------------------------------------

    \130\ EPA is amending its rules applicable to engines installed 
in glider kits, which will affect emission standards not only for 
GHGs but for criteria pollutants as well. EPA is also clarifying its 
requirements for certification and revising its definitions for 
glider kit and glider vehicle manufacturers. NHTSA is not including 
glider vehicles under its Phase 2 fuel consumption standards. See 
Section XIII.B.
---------------------------------------------------------------------------

    These flexibilities are described in more detail in Section XIV, in 
RIA Section 12 and in the Panel Report. Flexibilities specific to 
glider vehicle assemblers are described in Section XIII.
(d) Confidentiality of Test Results and GEM Inputs
    The agencies received mixed comments regarding the question of 
whether GEM inputs should be made available to public. Some commenters 
supported making this information available, while others thought it 
should

[[Page 73527]]

be protected as confidential business information (CBI). In accordance 
with Federal statutes, EPA does not release information from 
certification applications (or other compliance reports) that we 
determine to be CBI under 40 CFR part 2. Consistent with section 114(c) 
of the CAA, EPA does not consider emission test results to be CBI after 
introduction into commerce of the certified engine or vehicle. 
(However, we have generally treated test results as protected before 
the introduction into commerce date). EPA has not yet made a final 
determination for Phase 1 or Phase 2 certification test results. 
Nevertheless, at this time we expect to continue this policy and 
consider it likely that we would not treat any test results or other 
GEM inputs as CBI after the introduction into commerce date as 
identified by the manufacturer.
    With regard to NHTSA's treatment of confidential business 
information, manufacturers must submit a request for confidentiality 
with each electronic submission specifying any part of the information 
or data in a report that it believes should be withheld from public 
disclosure as trade secret or other confidential business information. 
A form is available through the NHTSA Web site to request 
confidentiality. NHTSA does not consider manufacturers to continue to 
have a business case for protecting pre-model report data after the 
vehicles contained within that report have been introduced into 
commerce.
(e) Delegated Assembly and Secondary Manufacturers
    In EPA's existing regulations (40 CFR 1068.261), we allow engine 
manufacturers to sell or ship engines that are missing certain 
emission-related components if those components will be installed by 
the vehicle manufacturer. These provisions already apply to Phase 1 
vehicles as well, providing a similar allowance for vehicle 
manufacturers to sell or ship vehicles that are missing certain 
emission-related components if those components will be installed by a 
secondary vehicle manufacturer. See section 1037.620. EPA has found 
this provision to work well and is finalizing certain amendments in 
this rule. See 40 CFR 1037.621. Under the amended rule, as conditions 
of this allowance, manufacturers will be required to:

 Have a contractual obligation with the secondary manufacturer 
to complete the assembly properly and provide instructions about how to 
do so
 Keep records to demonstrate compliance
 Apply a temporary label to the incomplete vehicles
 Take other reasonable steps to ensure the assembly is 
completed properly
 Describe in its application for certification how it will use 
this allowance

    Under delegated assembly, it is the upstream manufacturer that 
holds the certificate and assumes primary responsibility for all 
compliance requirements. Our experience applying this approach has 
shown that holding the upstream manufacturer responsible ensures that 
they will exercise due diligence throughout the process.
    EPA proposed to apply this new section broadly. However, commenters 
raised valid questions about whether it is necessary to apply this 
formal process as broadly as proposed. In response, we have 
reconsidered the proposed approach and have determined that it would be 
appropriate to allow a less formal process with components for which 
market forces will make it unlikely that a secondary manufacturer would 
not complete assembly properly. In those cases, the certifying 
manufacturers will be required to provide sufficiently detailed 
installation instructions to the secondary manufacturers, who would 
then be obligated to complete assembly properly before the vehicles are 
delivered to the ultimate purchasers.
    One example of a case for which market forces could ensure that 
assembly is completed properly would be air conditioning leakage 
requirements. Purchasers will have the expectation that the systems 
will not leak, and a secondary manufacturer should have no incentive to 
not follow the certifying manufacturer's instructions.
    As revised, Sec.  1037.621 will require the formal delegated 
assembly process for the following technologies if they are part of the 
OEM's certified configuration but not shipped with the vehicle:

 Auxiliary power units
 Aerodynamic devices
 Hybrid components
 Natural gas fuel tanks

    Certificate holders will remain responsible for other certified 
components, but will not automatically be required to comply with the 
formal delegated assembly requirements. That determination will be made 
case-by-case as part of the certification process. We are also 
explicitly making the flexibility in 40 CFR 1037.621 available for HD 
pickups and vans certified to the standards in 40 CFR part 86. As is 
currently specified in 40 CFR 1068.261, EPA will retain the authority 
to apply additional necessary conditions (at the time of certification) 
to the allowance to delegate assembly of emission to secondary 
manufacturers (when emission control equipment is not shipped with the 
vehicle to the secondary manufacturer, as just noted). In particular, 
we would likely apply such additional conditions for manufacturers that 
we determine to have previously not completed assembly properly. Issues 
of delegated assembly are addressed in more detail in Section 1.4.4 of 
the RTC.
(f) Engine/Vehicle Useful Life
    We received comment on what policies we should adopt to address the 
situation where the engine and the vehicle are subject to emission 
standards over different useful-life periods. For example, a medium 
heavy-duty engine may power vehicles in weight classes ranging from 2b 
to 8, with correspondingly different regulatory useful lives for those 
vehicles. As provided in 40 CFR 1037.140 of the final regulations, we 
have structured the vehicle regulations to generally apply the same 
useful life for the vehicle that applies for the engines. However, 
these regulations also allow vehicle manufacturers to certify their 
vehicles to longer useful lives. The agencies see no problem with 
allowing vehicles to have longer useful lives than the engines.
(g) Compliance Reports
    The agencies received comment on the NPRM from two environmental 
organizations requesting that the agencies make available to the public 
data and information that would enable the public to track trends in 
technology sales over time, as well as track company-specific 
compliance data. The commenters suggested that this should include an 
agency publication of an annual compliance report for the Heavy-duty 
Phase 2 program. The commenters requested this information to allow all 
stakeholders to see how individual companies, as well as the industry 
overall, were performing relative to their compliance obligations (see 
comments from ACEEE and NRDC).
    The agencies agree with this comment. In the context of the light-
duty vehicle GHG standards, EPA has already published four annual 
compliance reports which has made available to the public detailed 
information regarding both how individual light-duty vehicle companies 
have been meeting their compliance obligations, as well as summary 
information at the light-duty fleet level. NHTSA makes the up-to-date 
information on the light-duty fuel economy program available through 
its

[[Page 73528]]

CAFE Public Information Center (http://www.nhtsa.gov/CAFE_PIC/CAFE_PIC_Home.htm). Information includes manufacturer and overall fleet 
standards and CAFE performance, credit status, and civil penalty 
status. This information has been helpful to increase transparency to 
all stakeholders and to allow the public to see how companies are 
progressing from one year to the next with respect to their compliance 
requirements. It is EPA's intention to publish a similar annual 
compliance report for the heavy duty GHG program, covering both the 
existing Phase 1 program, as well as the Phase 2 standards contained in 
this final rule. It is NHTSA's intention to expand the Public 
Information Center to include the medium- and heavy-duty fuel 
efficiency program and to make up-to-date information collected in the 
heavy-duty fuel efficiency compliance process available publicly. Both 
the EPA and NHTSA compliance reports will provide available information 
at the vehicle subclass level for each of the four vehicle categories 
(i.e. Tractors, Trailers, Vocational, and Heavy-Duty Pickups and Vans), 
and EPA will provide available information for the other GHG standards, 
such as N2O and refrigerant leak detection standards. Prior 
to issuing the compliance reports, EPA and NHTSA will work with 
regulated manufacturers to reconcile concerns over the release of 
claimed confidential business information, consistent with 40 CFR part 
2 and 49 CFR 512.
(3) Life Cycle Emissions
    The agencies received many comments expressing concerns about 
establishing the GHG and fuel consumption standards as tailpipe 
standards that do not account for upstream emissions or other life 
cycle impacts. However, many other commenters supported this approach. 
Comments specifically related to alternative fuels or electric vehicles 
are addressed in Section I.C.(1)(d) and in Section XI.B. This section 
addresses the issue more broadly.
    As discussed below, the agencies do not see how we could accurately 
account for life cycle emissions in our vehicle standards, nor have 
commenters shown that such an accounting is needed. In addition, NHTSA 
has already noted that the fuel efficiency standards are necessarily 
tailpipe-based, and that a lifecycle approach would likely render it 
impossible to harmonize the fuel efficiency and GHG emission standards, 
to the great detriment of our goal of achieving a national, harmonized 
program. See 76 FR 57125.
    It is also worth noting that EPA's engine and vehicle emission 
standards and NHTSA's vehicle fuel consumption standards (including 
those for light-duty vehicles) have been in place for decades as 
tailpipe standards. The agencies find no reasonable basis in the 
comments or elsewhere to change fundamentally from this longstanding 
approach.
    Although the final standards do not account for life cycle 
emissions, the agencies have estimated the upstream emission impact of 
reducing fuel consumption for heavy-duty vehicles. As shown in Section 
VII and VIII, these upstream emission reductions are significant and 
worth estimating, even with some uncertainty. However, this analysis 
would not be a sufficient basis for inclusion in the standards 
themselves.
(a) Challenges for Addressing Life Cycle Emissions With Vehicle 
Standards
    Commenters supporting accounting for life cycle emissions generally 
did so in the context of one or more specific technologies. However, 
the agencies cannot accurately address life-cycle emissions on a 
technology specific basis at this time for two reasons:
     We lack data to address each technology, and see no path 
to selectively apply a life cycle analysis to some technologies, but 
not to others.
     Actual life cycle emissions are dependent on factors 
outside the scope of the rulemaking that may change in the future.
    With respect to the first reason, even if we were able to 
accurately and fully account for life cycle impacts of one technology 
(such as weight reduction), this would not allow us to address life 
cycle emissions for other technologies. For example, how would the 
agencies address potential differences in life cycle emissions for 
shifting from a manual transmission to and AMT, or the life cycle 
emissions of aerodynamic fairings? If we cannot factor in life cycle 
impacts for all technologies, how would we do it for weight reductions? 
Given the complexity of these rules and the number of different 
technologies involved, we see no way to treat the technologies 
equitably. Commenters do not provide the information necessary to 
address this challenge, nor are the agencies aware of such information.
    The second reason is just as problematic. This rulemaking is 
setting standards for vehicles under specific statutory provisions. It 
is not regulating manufacturing processes, distribution practices, or 
the locations of manufacturing facilities. And yet each of these 
factors could impact life cycle emissions. So while we could take a 
snapshot of life cycle emissions at this point in time for specific 
manufacturers, it may or may not have any relation to life cycle 
emissions in 2027, or for other manufacturers. Consider, for example, 
two component manufacturers: One that produces its components near the 
vehicle assembly plant, and relies on natural gas to power its factory; 
and a second that is located overseas and relies on coal-fired power. 
How would the agencies equitably (or even non-arbitrarily) factor in 
these differences without regulating these processes? To the extent 
commenters provided any information on life cycle impacts, they did not 
address this challenge.
(b) Need for Life Cycle Consideration in the Standards
    The agencies acknowledge that a full and accurate accounting of 
life cycle emissions (if it were possible) could potentially make the 
Phase 2 program marginally better. However, we do not agree that this 
is an issue of fundamental importance. While some commenters submitted 
estimates of the importance of life cycle emissions for light-duty 
vehicles, life cycle emissions are less important for heavy-duty 
vehicles. Consider, for example, the difference between a passenger car 
and a heavy-duty tractor. If the passenger car achieves 40 mile per 
gallon and travels 150,000 miles in its life, it would consume less 
than 4,000 gallons of fuel in its life. On the other hand, a tractor 
that achieves 8 miles per gallon and travels 1,000,000 miles would 
consume 125,000 gallons of fuel in its life, or more than 30 times the 
fuel of the passenger car. Commenters provide no basis to assume the 
energy consumption associated with tractor production would be 30 times 
that of the production of a passenger car.
(4) Amendments to the Phase 1 Program
    The agencies are revising some test procedures and compliance 
provisions used for Phase 1. These changes are described in Section 
XII. This includes both amendments specific to Phase 1, as well as 
amendments that apply more broadly than Phase 1, such as the revisions 
to the delegated assembly provisions. As a drafting matter, EPA notes 
that we are moving the GHG standards for Class 2b and 3 pickups and 
vans from 40 CFR 1037.104 to 40 CFR 86.1819-14.
    NHTSA is also amending 49 CFR part 535 to make technical 
corrections to its Phase 1 program to better align with EPA's 
compliance approach, standards and CO2 performance results. 
In general, these changes are intended to improve the regulatory 
experience for regulated

[[Page 73529]]

parties and also reduce agency administrative burden. More 
specifically, NHTSA is changing the rounding of its standards and 
performance values to have more significant digits. Increasing the 
number of significant digits for values used for compliance with NHTSA 
standards reduces differences in credits generated and overall credit 
balances for the EPA and NHTSA programs. NHTSA is also removing the 
petitioning process for off-road vehicles, clarifying requirements for 
the documentation needed for submitting innovative technology requests 
in accordance with 40 CFR 1037.610 and 49 CFR 535.7, and adding further 
detail to requirements for submitting credit allocation plans as 
specified in 49 CFR 535.9. Finally, NHTSA is adding the same 
recordkeeping requirements that EPA currently requires to facilitate 
in-use compliance inspections. These changes are intended to improve 
the regulatory experience for regulated parties and also reduce agency 
administrative burden.
    The agencies received few comments on these changes, with most 
supporting the proposed changes or suggesting improvements. These 
comments as well as the few comments opposing any of these changes are 
discussed in Section XII and in the RTC.
(5) Other Amendments to EPA Regulations
    EPA is finalizing certain other changes to regulations that we 
proposed, which are not directly related to the HD Phase 1 or Phase 2 
programs, as detailed in Section XIII. For these amendments, there are 
no corresponding changes in NHTSA regulations. Some of these amendments 
relate directly to heavy-duty highway engines, but not to the GHG 
programs. Others relate to nonroad engines. This latter category 
reflects the regulatory structure EPA uses for its mobile source 
regulations, in which regulatory provisions applying broadly to 
different types of mobile sources are codified in common regulatory 
parts such as 40 CFR part 1068. This approach creates a broad 
regulatory structure that regulates highway and nonroad engines, 
vehicles, and equipment collectively in a common program. Thus, it is 
appropriate to include some amendments to nonroad regulations in 
addition to the changes applicable only for highway engines and 
vehicles.
    Except as noted below, the agencies received relatively few 
significant comments on these issues. All comments are discussed in 
more detail in Section XIII and in the RTC. One area, for which we did 
receive significant comment was the issue of competition vehicles. As 
described in Section XIII, EPA is not finalizing the proposed 
clarification related to highway vehicles used for competition.
(a) Standards for Engines Installed In Glider Kits
    EPA regulations currently allow used pre-2013 engines to be 
installed into new glider kits without meeting currently applicable 
standards. As described in Section XIII.B, EPA is amending its 
regulations to allow only engines that have been certified to meet 
standards for the model year in which the glider vehicle is assembled 
(i.e. current model year engine standards) to be installed in new 
glider kits, with certain exceptions. First, engines certified to 
earlier MY standards that are identical to the current model year 
standards may be used. Second, engines still within their useful life 
(and certain similar engines) may be used. Note that this would not 
allow use of the pre-2002 engines that are currently being used in most 
glider vehicles because they all would be outside of the 10-year useful 
life period. Finally, the interim small manufacturer allowance for 
glider vehicles will also apply for the engines used in the exempted 
glider kits. Comments on this issue are summarized and addressed in 
Section XIII.B and in RTC Section 14.2.
(b) Nonconformance Penalty Process Changes
    Nonconformance penalties (NCPs) are monetary penalties established 
by regulation that allow a vehicle or engine manufacturer to sell 
engines that do not meet the emission standards. Manufacturers unable 
to comply with the applicable standard pay penalties, which are 
assessed on a per-engine basis.
    On September 5, 2012, EPA adopted final NCPs for heavy heavy-duty 
diesel engines that could be used by manufacturers of heavy-duty diesel 
engines unable to meet the current oxides of nitrogen (NOX) 
emission standard. On December 11, 2013 the U.S. Court of Appeals for 
the District of Columbia Circuit issued an opinion vacating that Final 
Rule. It issued its mandate for this decision on April 16, 2014, ending 
the availability of the NCPs for the current NOX standard, 
as well as vacating certain amendments to the NCP regulations due to 
concerns about inadequate notice. In particular, the amendments revise 
the text explaining how EPA determines when NCP should be made 
available. In the Phase 2 NPRM, EPA re-proposed most of these 
amendments to provide fuller notice and additional opportunity for 
public comment. As discussed in Section XIII, although EPA received one 
comment opposing these amendments, they are being finalized as 
proposed.
(c) Updates to Heavy-Duty Engine Manufacturer In-Use Testing 
Requirements
    EPA and manufacturers have gained substantial experience with in-
use testing over the last four or five years. This has led to important 
insights in ways that the test protocol can be adjusted to be more 
effective. We are accordingly making changes to the regulations in 40 
CFR part 86, subparts N and T.
(d) Extension of Certain 40 CFR Part 1068 Provisions to Highway 
Vehicles and Engines
    As part of the Phase 1 GHG standards, we applied the exemption and 
importation provisions from 40 CFR part 1068, subparts C and D, to 
heavy-duty highway engines and vehicles. We also specified that the 
defect reporting provisions of 40 CFR 1068.501 were optional. In an 
earlier rulemaking, we applied the selective enforcement auditing under 
40 CFR part 1068, subpart E (75 FR 22896, April 30, 2010). We are 
adopting the rest of 40 CFR part 1068 for heavy-duty highway engines 
and vehicles, with certain exceptions and special provisions.
    As described above, we are applying all the general compliance 
provisions of 40 CFR part 1068 to heavy-duty engines and vehicles 
subject to 40 CFR parts 1036 and 1037. We are also applying the recall 
provisions and the hearing procedures from 40 CFR part 1068 for highway 
motorcycles and for all vehicles subject to standards under 40 CFR part 
86, subpart S.
    EPA is updating and consolidating the regulations related to formal 
and informal hearings in 40 CFR part 1068, subpart G. This will allow 
us to rely on a single set of regulations for all the different 
categories of vehicles, engines, and equipment that are subject to 
emission standards. We also made an effort to write these regulations 
for improved readability.
    We are also making a number of changes to part 1068 to correct 
errors, to add clarification, and to make adjustments based on lessons 
learned from implementing these regulatory provisions.
(e) Amendments to Engine and Vehicle Test Procedures in 40 CFR Parts 
1065 and 1066
    EPA is making several changes to our engine testing procedures 
specified in

[[Page 73530]]

40 CFR part 1065. None of these changes will significantly impact the 
stringency of any standards.
(f) Amendments Related to Marine Diesel Engines in 40 CFR Parts 1042 
and 1043
    EPA's emission standards and certification requirements for marine 
diesel engines under the Clean Air Act and the act to Prevent Pollution 
from Ships are identified in 40 CFR parts 1042 and 1043, respectively. 
EPA is amending these regulations with respect to continuous 
NOX monitoring and auxiliary engines, as well as making 
several other minor revisions.
(g) Amendments Related to Locomotives in 40 CFR Part 1033
    EPA's emission standards and certification requirements for 
locomotives under the Clean Air Act are identified in 40 CFR part 1033. 
EPA is making several minor revisions to these regulations.
(6) Other Amendments to NHTSA Regulations
    NHTSA proposed to amend 49 CFR parts 512 and 537 to allow 
manufacturers to submit required compliance data for the Corporate 
Average Fuel Economy (CAFE) program electronically, rather than 
submitting some reports to NHTSA via paper and CDs and some reports to 
EPA through its VERIFY database system. NHTSA is not finalizing this 
proposal in this rulemaking and will consider electronic submission for 
CAFE reports in a future action.

II. Vehicle Simulation and Separate Engine Standards for Tractors and 
Vocational Chassis

A. Introduction

    This Section II. describes two regulatory program elements that are 
common among tractors and vocational chassis. In contrast, Sections III 
and V respectively describe the regulatory program elements that are 
unique to tractors and to vocational chassis. The common elements 
described here are the vehicle simulation approach to vehicle 
certification and the separate standards for engines. Section II.B 
discusses the reasons for this Phase 2 regulatory approach; namely, 
requiring vehicle simulation for tractor and vocational chassis 
certification, maintaining separate engine standards, and expanding and 
updating their related mandatory and optional test procedures. Section 
II.C discusses in detail the evolution and final version of the vehicle 
simulation computer program, which is called the Greenhouse gas 
Emissions Model or ``GEM.'' Section II.C also discusses the evolution 
and final versions of the test procedures for determining the GEM 
inputs that are common for tractors and vocational chassis. Section 
II.D discusses in detail the separate engine standards for GHGs and 
fuel efficiency and their requisite test procedures.
    In this final action, the agencies have built on the success of the 
Phase 1 GEM-based approach for the certification of tractors and 
vocational chassis. To better recognize the real-world impact of 
vehicle technologies, we have expanded the number of required and 
optional vehicle inputs into GEM. Inputting these additional details 
into GEM results in more accurate representations of vehicle 
performance and greater opportunities to demonstrate reductions in 
CO2 emissions and fuel consumption. We are also finalizing 
revisions to the vehicle driving patterns that are programmed into GEM 
to better reflect real-world vehicle operation and the emissions 
reductions that result from applying GHG and fuel efficiency 
technologies to vehicles. As a result of these revisions, the final 
GEM-based vehicle certification approach necessitates new testing of 
engines and testing of some other vehicle components to generate the 
additional GEM inputs for Phase 2. More detail is provided in Section 
II.C.
    Based on our assessments of the technological feasibility; cost 
effectiveness; requisite lead times for implementing new and additional 
tractor and vocational vehicle technologies; and based on comments we 
received in response to our notice of proposed rulemaking and in 
response to our more recent notice of additional data availability, the 
agencies are finalizing steadily increasing stringencies of the 
CO2 and fuel consumption standards for tractors and 
vocational chassis for vehicle model years 2021, 2024 and 2027. See 
Section I or Sections III and V respectively for these numerical 
standards for tractors and vocational chassis. As part of our 
analytical process for determining the numerical values of these 
standards, the agencies utilized GEM. Using GEM as an integral part of 
our own standard-setting process helps ensure consistency between our 
technology assessments and the GEM-based certification process that we 
require for compliance with the Phase 2 standards. Our utilization of 
GEM in our standard-setting process is described further in Section 
II.C.
    For Phase 2 we are finalizing, as proposed, the same Phase 1 
certification approach for all of the GHG and fuel efficiency separate 
engine standards for those engines installed in tractors and vocational 
chassis. For the separate engine standards, we will continue to require 
the Phase 1 engine dynamometer certification test procedures, which 
were adopted substantially from EPA's existing heavy-duty engine 
emissions test procedures. In this action we are finalizing, as 
proposed, revisions to the weighting factors of the tractor engine 13-
mode steady-state test cycle (i.e., the Supplemental Engine Test cycle 
or ``SET''). The SET is required for determining tractor engine 
CO2 emissions and fuel consumption. Consistent with the 
rationale we presented in our proposal and consistent with comments we 
received, these revised SET weighting factors better reflect the lower 
engine speed operation of modern engines, which frequently occurs at 
tractor cruise speeds. We used these revised weighting factors as part 
of our engine technology assessments of both current engine technology 
(i.e., our ``baseline engine'' technology) and future engine 
technology.
    Based on our assessments of the technological feasibility; cost 
effectiveness; requisite lead times for implementing new and additional 
engine technologies; and based on comments we received in response to 
our notice of proposed rulemaking and in response to our more recent 
notice of additional data availability, the agencies are finalizing 
steadily increasing stringencies of the CO2 and fuel 
consumption separate engine standards for engine model years 2021, 2024 
and 2027. In addition, for each of these model years, EPA is 
maintaining the Phase 1 separate engine standards for CH4 
and N2O emissions--both at their Phase 1 numeric values. 
While EPA is not finalizing at this time more stringent N2O 
emissions standards, as originally proposed, EPA may soon revisit these 
separate engine N2O standards in a future rulemaking. All of 
the final Phase 2 separate engine standards are presented in Section 
II.D, along with our related assessments.

B. Phase 2 Regulatory Structure

    As proposed, in this final action the agencies have built on the 
success of the Phase 1 GEM-based approach for the certification of 
tractors and vocational chassis, while also maintaining the Phase 1 
separate engine standards approach to engine certification. While the 
regulatory structures of both Phase 1 and Phase 2 are quite similar, 
there are a number of new elements for Phase 2. Note that we are not 
applying these new

[[Page 73531]]

Phase 2 elements for compliance with the Phase 1 standards.
    These modifications for Phase 2 are consistent with the agencies' 
Phase 1 commitments to consider a range of regulatory approaches during 
the development of future regulatory efforts (76 FR 57133), especially 
for vehicles not already subject to full vehicle chassis dynamometer 
testing. For example, we committed to consider a more sophisticated 
approach to vehicle testing to more completely capture the complex 
interactions within the total vehicle, including the engine and 
powertrain performance. We also committed to consider the potential for 
full vehicle certification of complete tractors and vocational chassis 
using a chassis dynamometer test procedure. We also considered chassis 
dynamometer testing of complete tractors and vocational chassis as a 
complementary approach for validating a more complex vehicle simulation 
approach. We committed to consider the potential for a regulatory 
program for some of the trailers hauled by tractors. After considering 
these various approaches, the agencies proposed a structure in which 
regulated tractor and vocational chassis manufacturers would 
additionally enter engine and powertrain-related inputs into GEM, which 
was not part of in Phase 1.
    The basic structure in the proposal was widely supported by 
commenters, although some commenters supported changing certain 
aspects. Some commenters suggested revising GEM to recognize additional 
technologies, such as tire pressure monitoring systems and electronic 
controls that decrease fuel consumption while a vehicle is coasting. To 
the extent that the agencies were able to collect and receive 
sufficient data to support such revisions in GEM, these changes were 
made. See Section II.C. for details. For determining certain GEM 
inputs, some commenters suggested more cost-effective test procedures 
for separate engine and transmission testing, compared to the engine-
plus-transmission powertrain test procedure that the agencies proposed. 
In collaboration with researchers at engine manufacturer test 
laboratories, at Oak Ridge National Laboratory and at Southwest 
Research Institute, the agencies completed a number of laboratory 
evaluations of these suggested test procedures.\131\ Based on these 
results, which were made available to the public for a 30-day comment 
period in the NODA, the agencies are finalizing these more cost-
effective test procedures as options, in addition to the powertrain 
test procedure we proposed. We note that we are also finalizing some of 
these more cost-effective test procedures, the cycle average approach 
for all vehicle cycles, as optional for the testing of ``pre-
transmission'' hybrids. In response to our request for comment, some 
commenters expressed support for a so-called, ``cycle-average'' 
approach for generating engine map data for input into GEM. This 
approach facilitates an accurate recognition of an engine's transient 
performance. The agencies further refined this approach, and we made 
detailed information on this approach available in the NODA.\132\ Based 
on comments, we are finalizing this approach as mandatory for mapping 
engines over GEM's transient cycle, and we are allowing this approach 
as optional for GEM's 55 mph and 65 mph cycles.
---------------------------------------------------------------------------

    \131\ Oak Ridge National Laboratory results docketed for the 
NODA: EPA-HQ-OAR-2014-0827-1622 and NHTSA-2014-0132-0183. Southwest 
Research Institute results docketed for the NODA: EPA-HQ-OAR-2014-
0827-1619 and NHTSA-2014-0132-0184.
    \132\ Ibid.
---------------------------------------------------------------------------

    Some commenters expressed concern about GEM and our proposed 
tractor standards appropriately accounting for the performance of 
powertrain technologies installed in some of the largest specialty 
tractors. We have addressed this concern by finalizing a new ``heavy-
haul'' tractor sub-category, with a unique payload and vehicle masses 
in GEM, which result in a unique set of numeric standards for these 
vehicles. This is explained in detail in Section III.D. Other 
commenters expressed concern about the greater complexity of GEM's 
additional inputs and the appropriateness of our proposed vocational 
chassis standards, as applied to certain custom-built vocational 
chassis. We have addressed these concerns by finalizing a limited 
number of optional custom chassis standards, tailored according to a 
vocational chassis' final application (e.g., school bus, refuse truck, 
cement mixer, etc.). To address the concerns about GEM's complexity for 
these specialty vehicles, these optional custom chassis standards 
require a smaller number of GEM inputs. This is explained in detail in 
Section V.D.
    Some vehicle manufacturers did not support the agencies finalizing 
separate engine standards. However, as described below, the agencies 
continue to believe that separate engine standards are necessary and 
appropriate. Thus, the agencies are finalizing the basic rule structure 
that was proposed, but with a number of refinements.
    For trailer manufacturers, which will be subject to first-time 
standards under Phase 2, we will apply the standards using a GEM-based 
certification, but to do so without actually running GEM. More 
specifically, based on the agencies' analysis of the results of running 
GEM many times and varying GEM's trailer configurations, the agencies 
have developed a simple equation that replicates GEM results, based on 
inputting certain trailer values into the equation. Use of the 
equation, rather than full GEM, should significantly facilitate trailer 
certification. As described in Chapter 2.10.5 of the RIA, the equation 
has a nearly perfect correlation with GEM, so that they can be used 
instead of GEM, without impacting stringency. This is a result of the 
relative simplicity of the trailer inputs as compared to the tractor 
and vocational vehicle inputs.
(1) Other Structures Considered
    To follow-up on the commitment to consider other approaches, the 
agencies spent significant time and resources before the proposal in 
evaluating six different options for demonstrating compliance with the 
proposed Phase 2 standards as shown in Figure II.1

[[Page 73532]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.001

    As shown in Figure II.1 these six options include:
    1. Full vehicle simulation, where vehicle inputs are entered into 
simulation software.
    2. Vehicle simulation, supplemented with separate engine standards.
    3. Controllers-in-the-loop simulation, where an actual electronic 
transmission controller module (TCM) and an actual engine controller 
module (ECM) are tested in hardware.
    4. Engine-in-the-loop simulation, with or without a TCM, where at 
least the engine is tested in hardware.
    5. Vehicle simulation with powertrain-in-the-loop, where the engine 
and transmission are tested in hardware. One variation involves an 
engine standard.
    6. Full vehicle chassis dynamometer testing.
    The agencies evaluated these options in terms of the capital 
investment required of regulated manufacturers to conduct the testing 
and/or simulation, the cost per test, the accuracy of the simulation, 
and the challenges of validating the results. Other considerations 
included the representativeness compared to the real world behavior, 
maintaining existing Phase 1 certification approaches that are known to 
work well, enhancing the Phase 1 approaches that could use 
improvements, the alignment of test procedures for determining GHG and 
non-GHG emissions compliance, and the potential to circumvent the 
intent of the test procedures. The agencies presented our evaluations 
in the proposal, and we received comments on some of these approaches, 
and these comments were considered carefully in our evaluations for 
this final action. Notably, in this final action we are adopting a 
combination of these options, where some are mandatory and others are 
optional for certification via GEM. We have concluded that this 
combination of these options strikes an optimal balance between their 
costs, accuracy with respect to real-world performance, and robustness 
for ensuring compliance. In this section we present our evaluation and 
rationale for finalizing these Phase 2 certification approaches.
    Chassis dynamometer testing (Option 6) is used extensively in the 
development and certification of light-duty vehicles. It also is used 
in Phase 1 to certify complete Class 2b/3 pickups and vans, as well as 
to certify certain incomplete vehicles (at the manufacturer's option). 
The agencies considered chassis dynamometer testing more broadly as a 
heavy-duty fuel efficiency and GHG certification option because chassis 
dynamometer testing has the ability to evaluate a vehicle's performance 
in a manner that most closely resembles the vehicle's in-use 
performance. Nearly all of the fuel efficiency technologies can be 
evaluated simultaneously on a chassis dynamometer, including the 
vehicle systems' interactions that depend on the behavior of the 
engine, transmission, and other vehicle electronic controllers. One 
challenge associated with the application of wide-spread heavy-duty 
chassis testing is the small number of heavy-duty chassis test sites 
that are available in North America. As discussed in RIA Chapter 3, the 
agencies were only able to locate 11 heavy-duty chassis test sites. 
However, more recently we have seen an increased interest in building 
new sites since issuing the Phase 1 Final Rule. For example, EPA is 
currently building a heavy-duty chassis dynamometer with the ability to 
test up to 80,000 pound vehicles at the National Vehicle and Fuel 
Emissions Laboratory in Ann Arbor, Michigan.
    Nevertheless, the agencies continue to be concerned about requiring 
a chassis test procedure for certifying tractors or vocational chassis 
due to the initial cost of a new test facility and the large number of 
heavy duty tractor and vocational chassis variants that could require 
testing. We have also concluded that for heavy-duty tractors and 
vocational chassis, there can be increased test-to-test variability 
under chassis dynamometer test conditions, versus other approaches. 
First, the agencies recognize that such testing

[[Page 73533]]

requires expensive, specialized equipment that is not widely available. 
The agencies estimate that it would vary from about $1.3 to $4.0 
million per new test site depending on existing facilities.\133\ In 
addition, the large number of heavy-duty vehicle configurations would 
require significant amounts of testing to cover the sector. For 
example, for Phase 1 tractor manufacturers typically certified several 
thousand variants of one single tractor model. Finally, EPA's 
evaluation of heavy-duty chassis dynamometer testing has shown that the 
variation of chassis test results is greater than light-duty testing, 
up to 3 percent worse, based on our sponsored testing at Southwest 
Research Institute.\134\ The agencies' research identified a number of 
unique sources of test-to-test variability in HD chassis dynamometer 
testing versus other types of testing (described next). These unique 
sources include variations in HD tire performance and tire temperature 
and pressure stability; variations in human driver performance; and 
variations in the test facilities' heating, ventilation and air 
conditioning system affecting emissions after-treatment performance 
(e.g., increased fuel consumption to maintain after-treatment 
temperature) and engine accessory power (e.g., engine fan clutching). 
Although the agencies are not requiring chassis dynamometer 
certification of tractors and vocational chassis, we believe such an 
approach could potentially be appropriate in the future for some heavy 
duty vehicles if more test facilities become available and if the 
agencies are able to address the large number of vehicle variants that 
might require testing and the unique sources of test-to-test 
variability. Note, as discussed in Section II.C.(4) we are finalizing a 
manufacturer-run complete tractor heavy-duty chassis dynamometer test 
program for monitoring relative trends fuel efficiency and for 
comparing those trends to the trends indicated via GEM simulation. 
While the agencies did not receive significant comment on the 
appropriateness of full vehicle heavy-duty chassis dynamometer testing 
for certification, the agencies did receive significant, mostly 
negative, comment on the costs versus benefits of a manufacturer-run 
complete tractor heavy-duty chassis dynamometer test program for data 
collection. These comments and our responses are detailed in Section 
II.C.(4).
---------------------------------------------------------------------------

    \133\ 03-19034 TASK 2 Report-Paper 03-Class8_hil_DRAFT, 
September 30, 2013.
    \134\ GEM Validation, Technical Research Workshop, San Antonio, 
December 10-11, 2014.
---------------------------------------------------------------------------

    Another option considered for certification involves testing a 
vehicle's powertrain in a modified engine dynamometer test facility, 
which is part of option 5 shown in Figure II.1. In this case the engine 
and transmission are installed together in a laboratory test facility, 
and a dynamometer is connected to the output shaft of the transmission. 
GEM or an equivalent vehicle simulation computer program is then used 
to control the dynamometer to simulate vehicle speeds and loads. The 
step-by-step test procedure considered for this option was initially 
developed as an option for hybrid powertrain testing for Phase 1. We 
are not finalizing this approach as mandatory, but we are allowing this 
as an option for manufacturers to generate powertrain inputs for use in 
GEM. For Phase 2 we generally require this test procedure for 
evaluating hybrid powertrains for inputs into GEM, but there are 
certain exceptions where engine-only test procedures may be used to 
certify hybrids via GEM (e.g., pre-transmission hybrids).
    A key advantage of the powertrain test approach is that it directly 
measures the effectiveness of the engine, the transmission, and the 
integration of these two components. Engines and transmissions are 
particularly challenging to simulate within a computer program like GEM 
because the engines and transmissions installed in vehicles today are 
actively and interactively controlled by their own sophisticated 
electronic controls; namely the ECM and TCM.
    We believe that the capital investment impact on manufacturers for 
powertrain testing is reasonable; especially for those who already have 
heavy-duty engine dynamometer test facilities. We have found that, in 
general, medium-duty powertrains can be tested in heavy-duty engine 
test cells. EPA has successfully completed such a test facility 
conversion at the National Vehicle and Fuel Emissions Laboratory in Ann 
Arbor, Michigan. Southwest Research Institute (SwRI) in San Antonio, 
Texas has completed a similar test cell conversion. Oak Ridge National 
Laboratory in Oak Ridge, Tennessee has been operating a recently 
constructed heavy heavy-duty powertrain dynamometer facility, and EPA 
currently has an interagency agreement with DOE to fund EPA powertrain 
testing at ORNL. The results from this testing were published for a 30-
day comment period, as part of the NODA.\135\ Eaton Corporation has 
been operating a heavy-duty powertrain test cell and has provided the 
agencies with valuable test results and other comments.\136\ PACCAR 
recently constructed and began operation of a powertrain test cell that 
includes engine, transmission and axle test capabilities.\137\ EPA also 
contracted SwRI to evaluate North America's capabilities (as of 2014) 
for powertrain testing in the heavy-duty sector and the cost of 
installing a new powertrain cell that meets agency requirements.\138\ 
Results from this 2014 survey indicated that one supplier (Eaton) 
already had this capability. We estimate that the upgrade costs to an 
existing engine test facility are on the order of $1.2 million, and a 
new test facility in an existing building are on the order of $1.9 
million. We also estimate that current powertrain test cells that could 
be upgraded to measure CO2 emissions would cost 
approximately $600,000. For manufacturers or suppliers wishing to 
contract out such testing, SwRI estimated that a cost of $150,000 would 
provide about one month of powertrain testing services. Once a 
powertrain test cell is fully operational, we estimate that for a 
nominal powertrain family (i.e. one engine family tested with one 
transmission family), the cost for powertrain installation, testing, 
and data analysis would be about $70,000 in calendar year 2016, in 2016 
dollars. Since the NPRM in July 2015, the agencies and other 
stakeholders have completed significant new work toward refining the 
powertrain test procedure itself, and these results confirm the 
robustness of this approach. The agencies regulations provide details 
of the final powertrain test procedure. See 40 CFR 1037.550.
---------------------------------------------------------------------------

    \135\ Oak Ridge National Laboratory results docketed for the 
NODA: EPA-HQ-OAR-2014-0827-1622 and NHTSA-2014-0132-0183. Southwest 
Research Institute results docketed for the NODA: EPA-HQ-OAR-2014-
0827-1619 and NHTSA-2014-0132-0184.
    \136\ Eaton, Greenhouse gas emissions and fuel efficiency 
standards for medium- and heavy-duty engines and vehicles--Phase 2, 
80 FED. REG. 40,137--Docket ID NOS. EPA-HQ-OAR-2014-0827, October 1, 
2015.
    \137\ https://engines.paccar.com/technology/research-development/.
    \138\ 03-19034 TASK 2 Report-Paper 03-Class8_hil_DRAFT, 
September 30, 2013.
---------------------------------------------------------------------------

    Furthermore, the agencies have worked with key transmission 
suppliers to develop an approach to define transmission families. 
Coupled with the agencies' existing definitions of engine families (40 
CFR 1036.230 and 1037.230), we are finalizing powertrain family 
definitions in 40 CFR 1037.231 and axle and transmission families in 40 
CFR 1037.232.
    Even though there is conclusive evidence that powertrain testing is 
a

[[Page 73534]]

technically robust and cost-effective approach to evaluating the 
CO2 and fuel consumption performance of powertrains, and 
even though there has been a clear trend toward manufacturers and other 
test laboratories recognizing the benefits and investing in new 
powertrain testing facilities, the agencies also received significant 
negative comment regarding the sheer amount of powertrain testing that 
could be required to certify the large number of unique configurations 
(i.e., unique combinations of engines and transmissions). While the 
agencies proposed to allow manufacturers to group powertrains in 
powertrain families, as defined by the EPA in 40 CFR 1037.231, 
requiring powertrain testing broadly would still likely require a large 
number of tests. To address these concerns, while at the same time 
achieving most of the advantages of powertrain testing, the agencies 
are also finalizing some mandatory and optional test procedures to 
separately evaluate engine transient performance (via the mandatory 
``cycle-average'' approach for the transient cycle) and transmission 
efficiency performance. While neither of these test procedures capture 
the optimized shift logic and other benefits of deep integration of the 
engine and transmission controllers, which only powertrain testing can 
capture, these separate test procedures do capture the remaining 
benefits of powertrain testing. The advantage of these separate tests 
is that their results can be mixed and matched within GEM to represent 
many more combinations of engines and transmissions than a comparable 
number of powertrain tests. For example, separately testing three 
parent engines that each have two child ratings and separately 
efficiency testing three transmissions that each have three major 
calibrations requires the equivalent test time of testing 6 
powertrains, but without requiring the use of a powertrain test 
facility. More importantly, the results of these 6 tests can be 
combined within GEM to certify at least 27 different powertrain 
families, which would otherwise have required 27 powertrain tests--more 
than a four-fold increase in costs. This example clearly shows how 
cost-effective a vehicle simulation approach to vehicle certification 
can be.
    Another regulatory structure option considered by the agencies was 
engine-only testing over the GEM duty cycles over a range of simulated 
vehicle configurations, which is part of Option 4 in Figure II.1. This 
is essentially a ``cycle-average approach,'' which would use GEM to 
generate engine duty cycles by simulating a range of transmissions and 
other vehicle variations. These engine-level duty cycles would then be 
programmed into a separate controller of a dynamometer connected to an 
engine's output shaft. The agencies requested comment on this approach, 
and based on continued research that has been conducted since the 
proposal, and based on comments we received in response to the NODA, we 
are finalizing this approach as mandatory for determining the GEM 
inputs that characterize an engine's transient engine performance 
within GEM over the ARB Transient duty cycle. We are also finalizing 
this approach as optional for characterizing the more steady-state 
engine operation in GEM over the 55 mph and 65 mph duty cycles with 
road grade, in lieu of steady-state engine mapping for these two 
cycles. We are also finalizing this approach as an option for 
certifying pre-transmission hybrids, in lieu of powertrain testing. We 
are calling this approach the ``cycle-average'' approach, which 
generates a cycle-average engine fuel map that is input into GEM. This 
map simulates an engine family's performance over a given vehicle drive 
cycle, for the full range of vehicles into which that engine could be 
installed. Unlike the chassis dynamometer or powertrain dynamometer 
approaches, which could have significant test facility construction or 
modification costs, this engine-only approach necessitates little 
capital investment because engine manufacturers already have engine 
test facilities to both develop engines and to certify engines to meet 
both EPA's non-GHG standards and the agencies' Phase 1 fuel efficiency 
and GHG separate engine standards. This option has received significant 
attention since our notice of proposed rulemaking. EPA and others have 
published peer reviewed journal articles demonstrating the efficacy of 
this approach,139 140 and the agencies have received 
significant comments on both the information we presented in the 
proposal and in the NODA. Comments have been predominantly supportive, 
and the comments we received tended to focus on ideas for further minor 
refinements of this test procedure.136 141 142 143 144 145 
At this time the agencies believe that the wealth of experimental data 
supporting the robustness and cost-effectiveness of the cycle-average 
approach, supports the agencies' decision to finalize this test 
procedure as mandatory for the determination of the transient 
performance of engines for use in GEM (i.e., over the ARB Transient 
Cycle).
---------------------------------------------------------------------------

    \139\ H. Zhang, J, Sanchez, M, Spears, ``Alternative Heavy-duty 
Engine Test Procedure for Full Vehicle Certification,'' SAE Int. J. 
Commer. Veh. 8(2): 2015, doi:10.4271/2015-01-2768.
    \140\ G. Salemme, E.D., D. Kieffer, M. Howenstein, M. Hunkler, 
and M. Narula, An Engine and Powertrain Mapping Approach for 
Simulation of Vehicle CO2 Emissions. SAE Int. J. Commer. Veh, 
October 2015. 8: p. 440-450.
    \141\ Cummins, Inc., Comments in Response to Greenhouse Gas 
Emissions and Fuel Efficiency Standards for Medium- and Heavy-Duty 
Engines and Vehicles--Phase 2 (Docket ID No. EPA-HQ-OAR-2014-0827 
and Docket ID No. NHTSA-2014-0132).
    \142\ Paccar, Inc., Greenhouse Gas Emissions and Fuel Efficiency 
Standards for Medium- and Heavy-Duty Engines and Vehicles; Phase 2; 
Proposed Rule, 80 FR 40138 (July 13, 2015); Docket I.D. No.: EPA-HQ-
OAR-2014-0827 and NHTSA-2014-0132.
    \143\ Daimler Trucks North America LLC, Detroit Diesel 
Corporation, And Mercedes-Benz USA, Greenhouse Gas Emissions and 
Fuel Efficiency Standards for Medium- and Heavy-Duty Engines and 
Vehicles, Phase 2, Proposed Rule, Docket ID No: EPA-HQ-OAR-2014-0827 
and NHTSA-2014-0132; 80 FR 40137 (July 13, 2015).
    \144\ Volvo Group, Greenhouse Gas Emissions and Fuel Efficiency 
Standards for Medium- and Heavy-Duty Engines and Vehicles, Phase 2, 
Proposed Rule, Dockets ID No: EPA-HQ-OAR-2014-0827 and NHTSA-2014-
0132;80 FR 40137 (July 13, 2015).
    \145\ Navistar, Greenhouse Gas Emissions and Fuel Efficiency 
Standards for Medium- and Heavy-Duty Engines and Vehicles, Phase 2, 
Proposed Rule, Dockets ID No: EPA-HQ-OAR-2014-0827 and NHTSA-2014-
0132;80 FR 40137 (July 13, 2015).
---------------------------------------------------------------------------

    The agencies also considered simulating the engine, transmission, 
and vehicle using a computer program; while having the actual 
transmission electronic controller connected to the computer running 
the vehicle simulation program, which is part of Option 3 in Figure 
II.1. The output of the simulation would be an engine cycle that would 
be used to test the engine in an engine test facility. Just as in the 
cycle-average approach, this procedure would not require significant 
capital investment in new test facilities. An additional benefit of 
this approach would be that the actual transmission controller would be 
determining the transmission gear shift points during the test, without 
a transmission manufacturer having to reveal their proprietary 
transmission control logic. This approach comes with some significant 
technical challenges, however. The computer model would have to become 
more complex and tailored to each new transmission and controller to 
make sure that the controller would operate properly when it is 
connected to a computer instead of an actual transmission. Some 
examples of the transmission specific requirements would be simulating 
all the Controller Area Network (CAN) communication to and from the 
transmission controller and the specific sensor responses both through 
simulation and hardware. Each vehicle manufacturer would have to be

[[Page 73535]]

responsible for connecting the transmission controller to the computer, 
which would require a detailed verification process to ensure it is 
operating properly while it is in fact disconnected from a real 
transmission. Determining full compliance with this test procedure 
would be a significant challenge for the regulatory agencies because 
the agencies would have to be able to replicate each of the 
manufacturer's unique interfaces between the transmission controller 
and computer running GEM. The agencies did not receive any significant 
comments on this approach, presumably because commenters focused on the 
more viable options of powertrain testing and the cycle-average engine 
mapping approach. And because of the significant challenges noted 
above, the agencies did not pursue this option further between the time 
of proposal and this final action. However, should this approach 
receive more research attention in the future, such that the concerns 
noted above are sufficiently addressed, the agencies could consider 
allowing this certification approach as an option, within the context 
of a separate future rulemaking.
    Finally, the agencies considered full vehicle simulation plus 
separate engine standards (Option 2 in Figure II.1), which is the 
required approach being finalized for Phase 2. This approach is 
discussed in more detail in the following sections. It should be noted 
before concluding this subsection that the agencies do provide a 
regulatory path for manufacturers to apply for approval of alternative 
test methods that are different than those the agencies specify. See 40 
CFR part 1065, subpart A. Therefore, even though we have not finalized 
some of the certification approaches and test procedures that we 
investigated, our conclusions about these procedures do not prevent a 
manufacturer from seeking agency approval of any of these procedures or 
any other alternative procedures.
(2) Final Phase 2 Regulatory Structure
    Under the final Phase 2 structure, tractor and vocational chassis 
manufacturers will be required to provide engine, transmission, drive 
axle(s) and tire inputs into GEM (as well as the inputs already 
required under Phase 1). For Phase 1, GEM used fixed default values for 
all of these, which limited the types of technologies that could be 
recognized by GEM to show compliance with the standards. We are 
expanding GEM to account for a wider range of technological 
improvements that would otherwise need to be recognized through the 
more cumbersome off-cycle crediting approach in Phase 1. Additional 
technologies that will now be recognized in GEM also include 
lightweight thermoplastic materials, automatic tire inflation systems, 
tire pressure monitoring systems, advanced cruise control systems, 
electronic vehicle coasting controls, engine stop-start idle reduction 
systems, automatic engine shutdown systems, hybrids, and axle 
configurations that decrease the number of drive axles. The agencies 
are also continuing separate engine standards. As described below, we 
see advantages to having both engine-based and vehicle-based standards. 
Moreover, the advantages described here for full vehicle simulation do 
not necessarily correspond to disadvantages for engine testing or vice 
versa.
(a) Advantages of Vehicle Simulation
    The agencies' primary purpose in developing fuel efficiency and GHG 
emissions standards is to increase the use of vehicle technologies that 
improve fuel efficiency and decrease GHG emissions. Under the Phase 1 
tractor and vocational chassis standards, there is no regulatory 
incentive for vehicle manufacturers to consider adopting new engine, 
transmission or axle technologies because GEM was not configured to 
recognize these technologies uniquely, leaving off-cycle credits as the 
only regulatory mechanism to recognize these technologies' benefits. By 
recognizing such technologies in GEM under Phase 2, the agencies will 
be creating a direct regulatory incentive to improve engine, 
transmission, and axle technologies to improve fuel efficiency and 
decrease GHG emissions. In its 2014 report, NAS also recognized the 
benefits of full vehicle simulation and recommended that the Phase 2 
rules incorporate such an approach.\160\
    The new Phase 2 approach will create three new specific regulatory 
incentives. First, vehicle manufacturers will have an incentive to use 
the most efficient engines. Since GEM will no longer use the agency 
default engine in simulation, manufacturers will have their own engines 
recognized in GEM. Under Phase 1, engine manufacturers have a 
regulatory incentive to design efficient engines, but vehicle 
manufacturers do not have a similar regulatory incentive to use the 
most efficient engines in their vehicles. Second, the new Phase 2 
approach will create incentives for both engine and vehicle 
manufacturers to design engines and vehicles to work together to ensure 
that engines actually operate as much as possible near their most 
efficient points. This is because Phase 2 GEM will require the vehicle 
manufacturers to input specific transmission, axle, and tire 
characteristics, thus recognizing powertrain optimization, such as 
engine down-speeding, and different transmission architectures and 
technologies, such as automated manual transmissions, automatic 
transmissions, and different numbers of transmission gears, 
transmission gear ratios, axle ratios and tire revolutions per mile. No 
matter how well designed, all engines have speed and load operation 
points with differing fuel efficiency and GHG emissions. The speed and 
load point with the best fuel efficiency (i.e., peak thermal 
efficiency) is commonly known as the engine's ``sweet spot.'' The more 
frequently an engine operates near its sweet spot, the better the 
vehicle's fuel efficiency will be. In Phase 1, a vehicle manufacturer 
receives no regulatory credit under GEM for designing its vehicle to 
operate closer to its engine's sweet spot because Phase 1 GEM does not 
model the specific engine, transmission, axle, or tire revolutions per 
mile of the vehicle. Third, this approach will recognize improvements 
to the overall efficiency of the drivetrain, including the axle. The 
new version of GEM will recognize the benefits of different integrated 
axle technologies including axle lubricants (via an optional axle 
efficiency test), and technologies that reduce axle losses such as by 
enabling three-axle vehicles to deliver power to only one rear axle. 
This is accomplished through the simulation of axle disconnect 
technology (see Chapter 4.5 of the RIA). The new version of GEM also 
will be able to recognize the benefits of reducing energy losses within 
a transmission, via an optional transmission efficiency test.
    In addition to providing regulatory incentives to use more fuel 
efficient technologies, expanding GEM to recognize engine and other 
powertrain component improvements will provide important flexibility to 
vehicle manufacturers. Providing flexibility to effectively trade 
engine and other powertrain component improvements against the other 
vehicle improvements that are recognized in GEM will allow vehicle 
manufacturers to better optimize their vehicles to achieve the lowest 
cost for specific customers. Because of the improvements in GEM, GEM 
will recognize this deeper level of vehicle optimization. Vehicle 
manufacturers could use this flexibility to reduce overall compliance 
costs and/or address special applications where certain vehicle 
technologies are not preferred or

[[Page 73536]]

practical. The agencies considered in Phase 1 allowing the exchange of 
emission certification credits generated relative to the separate 
brake-specific engine standards and credits generated relative to the 
vehicle standards. However, we did not allow this in Phase 1 due in 
part to concerns about the equivalency of credits generated relative to 
different standards, with different units of measure and different test 
procedures. The Phase 2 approach eliminates these concerns because 
engine and other vehicle component improvements will be evaluated 
relative to the same vehicle standard in GEM. This also means that 
under the Phase 2 approach there is no need to consider allowing 
emissions credit trading between engine-generated and vehicle-generated 
credits because vehicle manufacturers are directly credited by the 
combination of engine and vehicle technologies they choose to install 
in each vehicle. Therefore, this approach eliminates one of the 
concerns about continuing separate engine standards, which was that a 
separate engine standard and a full vehicle standard were somehow 
mutually exclusive. That is not the case. In fact, in the next section 
we describe how we are continuing the separate engine standard along 
with recognizing engine performance at the vehicle level. The agencies 
acknowledge that maintaining a separate engine standard will limit 
flexibility in cases where a vehicle manufacturer wanted to use less 
efficient engines and make up for them using more efficient vehicle 
technologies. However, as described below, we see important advantages 
to maintaining a separate engine standard, and we believe they more 
than justify the reduced flexibility. Furthermore, in response to 
comments about some specialized vocational custom chassis, the agencies 
are finalizing a limited number of optional standards that would be met 
using a somewhat simplified version of GEM. Specifically, in this 
simplified version of GEM, which is only applicable as an option for 
certain custom chassis applications, the GEM inputs for the engine, 
transmission gears, gear ratios, gear efficiency; axle ratio, axle 
efficiency; and tire revolutions per mile are all fixed to default 
values. This simplification allows the option of certifying these 
custom chassis without penalty for utilizing less efficient engines, 
transmissions, or axles. This flexibility also addresses a comment the 
agencies received from Cummins that the inclusion of the specific 
engine in GEM limits the flexibility provided by the separate engine 
standards' emissions averaging, banking and trading program. Cummins 
explained that certain applications like emergency vehicles, cement 
mixers and recreational vehicles oftentimes require higher-performance, 
less-efficient, engines, which are credit using engines under the ABT 
program of the separate engine standards. Because these particular 
vehicle applications have few other cost-effective and practical 
vehicle-level technologies with which to offset their use of less 
efficient engines, the main Phase 2 vocational chassis standards that 
require engine and other powertrain inputs into GEM (i.e., the 
standards for other than custom chassis vocational vehicles) could be 
particularly challenging for these applications. However, the optional 
custom chassis standards solves this issue for custom chassis 
applications. This approach solves two issues. First, it provides a 
means toward certification for these custom chassis applications, 
without penalty for using the engines they need. Second, this approach 
maintains the flexibility intended by the separate engine standards' 
averaging, banking and trading program since these custom chassis 
applications would still be using certified engines.
    One disadvantage of recognizing engines and transmission in GEM is 
that it will increase complexity for the vehicle standards. For 
example, vehicle manufacturers will be required to conduct additional 
engine tests and to generate additional GEM inputs for compliance 
purposes. However, we believe that most of the burden associated with 
this increased complexity will be an infrequent burden of engine 
testing and updating information systems to track these inputs. 
Furthermore, the agencies are requiring that engine manufacturers 
certify their respective GEM inputs; namely, their own engine maps. 
Because there are a relatively small number of heavy-duty engine 
manufacturers who will be responsible for generating and complying with 
their declared engine maps for GEM, the overall engine testing burden 
to the heavy-duty vehicle industry is small. With this approach, the 
large number of vocational chassis manufacturers will not have to 
conduct any engine testing.
    Another potential disadvantage to GEM-based vehicle certification 
is that because GEM measures performance over specific duty cycles 
intended to represent average operation of vehicles in-use, this 
approach might also create an incentive to optimize powertrains and 
drivetrains for the best GEM performance rather than the best in-use 
performance for a particular application. This is always a concern when 
selecting duty cycles for certification, and so is not an issue unique 
to GEM. There will always be instances, however infrequent, where 
specific vehicle applications will operate differently than the duty 
cycles used for certification. The question is would these differences 
force manufacturers to optimize vehicles to the certification duty 
cycles in a way that decreases fuel efficiency and increases GHG 
emissions in-use? We believe that the certification duty cycles will 
not create a disincentive for manufacturers to properly optimize 
vehicles for customer fuel efficiency. First, the impact of the 
certification duty cycles versus any other real-world cycle will be 
relatively small because they affect only a small fraction of all 
vehicle technologies. Second, the emission averaging and fleet average 
provisions mean that the regulations will not require all vehicles to 
meet the standards. Vehicles exceeding a standard over the duty cycles 
because they are optimized for different in-use operation can be offset 
by other vehicles that perform better over the certification duty 
cycles. Third, vehicle manufacturers also have the ability to lower 
such a vehicle's measured GHG emissions by adding technology that would 
improve fuel efficiency both over the certification duty cycles and in-
use (and to be potentially eligible to generate off-cycle credits in 
doing so). These standards are not intended to be at a stringency where 
manufacturers will be expected to apply all technologies to all 
vehicles. Thus, there should be technologies available to add to 
vehicle configurations that initially fail to meet the Phase 2 
standards. Fourth, we are further sub-categorizing the vocational 
vehicle segment compared to Phase 1, tripling the number of 
subcategories within this segment from three to nine. These nine 
subcategories will divide each of the three Phase 1 weight categories 
into three additional vehicle speed categories. Each of the three speed 
categories will have unique duty cycle weighting factors to recognize 
that different vocational chassis are configured for different vehicle 
speed applications. This further subdivision better recognizes 
technologies' performance under the conditions for which the vocational 
chassis was configured to operate. This also decreases the potential of 
the certification duty cycles to encourage manufacturers to configure 
vocational chassis differently than the optimum configuration for 
specific customers' applications. Similarly, for the tractor

[[Page 73537]]

category we are finalizing a new ``heavy-haul'' category to recognize 
the greater payload and vehicle mass of these tractors, as well as 
their limitations to effectively utilize some technologies like 
aerodynamic technologies. These new categories help minimize 
differences between GEM simulation and real-world operation. Finally, 
we are also recognizing seven specific vocational vehicle applications 
under the optional custom chassis vocational vehicle standards.
    Another disadvantage of our full vehicle simulation approach is the 
potential requirement for engine manufacturers to disclose information 
to vehicle manufacturers who install their engines that engine 
manufacturers might consider to be proprietary. Under this approach, 
vehicle manufacturers may need to know some additional details about 
engine performance long before production, both for compliance planning 
purposes, as well as for the actual submission of applications for 
certification. Moreover, vehicle manufacturers will need to know 
details about the engine's performance that are generally not publicly 
available--specifically the detailed steady-state fuel consumption map 
of an engine. Some commenters expressed significant concern about the 
Phase 2 program forcing the disclosure of proprietary steady-state 
engine performance information to business competitors; especially 
prior to an engine being introduced into commerce. It can be argued 
that a sufficiently detailed steady-state engine map, such as the one 
required for input into GEM, can reveal proprietary engine design 
elements such as intake air, turbo-charger, and exhaust system design; 
exhaust gas recirculation strategies; fuel injection strategies; and 
exhaust after-treatment thermal management strategies. Conversely, the 
agencies also received comments requesting that all GEM inputs be made 
public, as a matter of transparency and public interest.
    It is unclear at this point whether such information is truly 
proprietary. In accordance with Federal statutes, EPA does not release 
information from certification applications (or other compliance 
reports) that we determine to be Confidential Business Information 
(CBI) under 40 CFR part 2. Consistent with section 114(c) of the CAA, 
EPA does not consider emission test results to be CBI after 
introduction into commerce of the certified engine or vehicle. However, 
we have generally treated test results as protected before a product's 
introduction into commerce date. EPA has not yet made a final CBI 
determination for Phase 1 or Phase 2 GEM inputs. Nevertheless, at this 
time we expect to continue our current policy of non-disclosure prior 
to introduction into commerce, but we consider it likely that we would 
ultimately not treat any test results or other GEM inputs as CBI after 
the introduction into commerce date, as identified by the manufacturer.
    To further address the specific concern about the Phase 2 program 
forcing the disclosure of proprietary steady-state engine maps to 
business competitors, especially prior to an engine being introduced 
into commerce, the agencies are finalizing an option for engine 
manufacturers to certify only ``cycle average'' engine maps over the 
55-mph and 65-mph GEM cycles and separately mandating the cycle average 
approach for use over the ARB Transient cycle. See Section II.B. above. 
The advantage to this approach is that each data point of a cycle 
average map represents the average emissions over an entire cycle. 
Therefore, the cycle average engine map approach does not reveal any 
potentially proprietary information about an engine's performance at a 
particular steady-state point of operation.
(b) Advantages of Separate Engine Standards
    For engines installed in tractors and vocational vehicle chassis, 
we are maintaining separate engine standards for fuel consumption and 
GHG emissions in Phase 2 for both spark-ignition (SI, generally but not 
exclusively gasoline-fueled) and compression-ignition (CI, generally 
but not exclusively diesel-fueled) engines. Moreover, we are adopting a 
sequence of new more stringent engine standards for CI engines for 
engine model years 2021, 2024 and 2027. While the vehicle standards 
alone are intended to provide sufficient incentive for improvements in 
engine efficiency, we continue to see important advantages to 
maintaining separate engine standards for both SI and CI engines. The 
agencies believe the advantages described below are critical to fully 
achieve the goals of the EPA and NHTSA standards.
    First, EPA has a robust compliance program based on separate engine 
testing. For the Phase 1 standards, we applied the existing criteria 
pollutant compliance program to ensure that engine efficiency in actual 
use reflected the improvements manufacturers claimed during 
certification. With engine-based standards, it is straightforward to 
hold engine manufacturers accountable by testing in-use engines in an 
engine dynamometer laboratory. If the engines exceed the standards, 
manufacturers can be required to correct the problem or perform other 
remedial actions. Without separate engine standards in Phase 2, 
addressing in-use compliance would be more subjective. Having clearly 
defined compliance responsibilities is important to both the agencies 
and to the manufacturers.
    Second, engine standards for CO2 and fuel efficiency 
force engine manufacturers to optimize engines for both fuel efficiency 
and control of non-CO2 emissions at the same engine 
operating points. This is of special concern for NOX 
emissions, given the strong counter-dependency between engine-out 
NOX emissions and fuel consumption. By requiring engine 
manufacturers to comply with both NOX and CO2 
standards using the same test procedures, the agencies ensure that 
manufacturers include technologies that can be optimized for both, 
rather than alternate, calibrations that would trade NOX 
emissions against fuel consumption, depending how the engine or vehicle 
is tested. In the past, when there was no CO2 engine 
standard and no steady-state NOX standard, some 
manufacturers chose this dual calibration approach instead of investing 
in technology that would allow them to simultaneously reduce both 
CO2 and NOX.
    It is worth noting that these first two advantages foster fair 
competition within the marketplace. In this respect, the separate 
engine standards help assure manufacturers that their competitors are 
not taking advantage of regulatory ambiguity. The agencies believe that 
the absence of separate engine standards would leave open the 
opportunity for a manufacturer to choose a high-risk compliance 
strategy by gaming the NOX-CO2 tradeoff. 
Manufacturer concerns that competitors might take advantage of this can 
create a dilemma for those who wish to fully comply, but also perceive 
shareholder pressure to choose a high-risk compliance strategy to 
maintain market share.
    Finally, the existence of meaningful separate engine standards 
allows the agencies to exempt certain vehicles from some or all of the 
vehicle standards and requirements without forgoing the engine 
improvements. A good example of this is the off-road vehicle exemption 
in 40 CFR 1037.631 and 49 CFR 535.3, which exempts vehicles ``intended 
to be used extensively in off-road environments'' from the vehicle 
requirements. The engines used in such vehicles must still meet the 
engine standards of 40 CFR 1036.108 and 49 CFR 535.5(d). The agencies 
see no

[[Page 73538]]

reason why efficient engines cannot be used in such vehicles. However, 
without separate engine standards, there would be no way to require the 
engines to be efficient. The engine standards provide a similar benefit 
with respect to the custom chassis program discussed in Section V.
    In the past there has been some confusion about the Phase 1 
separate engine standards somehow preventing the recognition of engine-
vehicle optimization that vehicle manufacturers perform to minimize a 
vehicle's overall fuel consumption. It was not the existence of 
separate engine standards that prevented recognition of this 
optimization. Rather it was that the agencies did not allow 
manufacturers to enter inputs into GEM that characterized unique engine 
performance. For Phase 2 we are requiring that manufacturers input such 
data because we intend for GEM to recognize this engine-vehicle 
optimization. The continuation of separate engine standards in Phase 2 
does not undermine in any way the recognition of this optimization in 
GEM.

C. Phase 2 GEM and Vehicle Component Test Procedures \146\
---------------------------------------------------------------------------

    \146\ The specific version of GEM used to develop these 
standards, and which we propose to use for compliance purposes is 
also known as GEM 3.0.
---------------------------------------------------------------------------

    GEM was originally created for the certification of tractors and 
vocational vehicle chassis to the agencies' Phase 1 CO2 and 
fuel efficiency standards. See 76 FR 57116, 57146, and 57156-57157. For 
Phase 2 the agencies proposed a number of modifications to GEM, and 
based on public comments in response to the agencies' proposed 
modifications, the agencies have further refined these modifications 
for this final action.
    In Phase 1 the agencies adopted a regulatory structure where 
regulated entities are required to use GEM to simulate and certify 
tractors and vocational vehicle chassis. This computer program is 
provided free of charge for unlimited use, and the program may be 
downloaded by anyone from EPA's Web site: http://www3.epa.gov/otaq/climate/gem.htm. GEM mathematically combines the results of a number of 
performance tests of certain vehicle components, along with other pre-
determined vehicle attributes and driving patterns to determine a 
vehicle's characteristic levels of fuel consumption and CO2 
emissions, for certification purposes. For Phase 1, the required inputs 
to GEM for tractors include vehicle aerodynamics information, tire 
rolling resistance, and whether or not a vehicle is equipped with 
certain lightweight high-strength steel or aluminum components, a 
tamper-proof speed limiter, or tamper-proof idle reduction 
technologies. For Phase 1, the sole input for vocational vehicles is 
tire rolling resistance. For Phase 1, the computer program's inputs did 
not include engine test results or attributes related to a vehicle's 
powertrain; namely, its transmission, drive axle(s), or tire 
revolutions per mile. Instead, for Phase 1 the agencies specified 
generic engine and powertrain attributes within GEM. For Phase 1 these 
are fixed and cannot be changed in GEM.\147\
---------------------------------------------------------------------------

    \147\ These attributes are recognized in Phase 1 innovative 
technology provisions at 40 CFR 1037.610.
---------------------------------------------------------------------------

    Similar to other vehicle simulation computer programs, GEM combines 
various vehicle inputs with known physical laws and justified 
assumptions to predict vehicle performance for a given period of 
vehicle operation. GEM represents this information numerically, and 
this information is integrated as a function of time to calculate 
CO2 emissions and fuel consumption. Some of the justified 
assumptions in GEM include average energy losses due to friction 
between moving parts of a vehicle's powertrain; the logical behavior of 
an average driver shifting from one transmission gear to the next; and 
speed limit assumptions such as 55 miles per hour for urban highway 
driving and 65 miles per hour for rural interstate highway driving. The 
sequence of the GEM vehicle simulation can be visualized by imagining a 
human driver initially sitting in a parked running tractor or 
vocational vehicle. The driver then proceeds to drive the vehicle over 
a prescribed route that includes three distinct patterns of driving: 
Stop-and-go city driving, urban highway driving, and rural interstate 
highway driving. The driver then exits the highway and brings the 
vehicle to a stop, with the engine still running at idle. This 
concludes the vehicle simulation sequence.
    Over each of the three driving patterns or ``duty cycles,'' GEM 
simulates the driver's behavior of pressing the accelerator, coasting, 
or applying the brakes. GEM also simulates how the engine operates as 
the gears in the vehicle's transmission are shifted and how the 
vehicle's weight, aerodynamics, and tires resist the forward motion of 
the vehicle. GEM combines the driver behavior over the duty cycles with 
the various vehicle inputs and other assumptions to determine how much 
fuel must be consumed to move the vehicle forward at each point during 
the simulation. For Phase 2 the agencies added the effect of road 
grade. In GEM the effect of road grade on fuel consumption is simulated 
by increasing fuel consumption uphill, by the amount of fuel consumed 
by the engine to provide the power needed to raise the mass of the 
vehicle and its payload against the force of Earth's gravity--while at 
the same time maintaining the duty cycle's vehicle speed. Downhill road 
grades are simulated by decreasing the engine's fuel consumption, by 
the amount of power returned to the vehicle by it moving in the same 
direction as Earth's gravity. To maintain vehicle speed downhill, 
simulated brakes are sometimes applied, and the energy lost due to 
braking results in a certain amount of fuel consumption as well. For 
each of the three duty cycles, GEM totals the amount of fuel consumed 
and then divides that amount by the product of the miles travelled and 
tons of payload carried. The tons of payload carried are specified by 
the agencies for each vehicle type and weight class, and these cannot 
be changed in GEM.
    In addition to determining fuel consumption over these duty cycles, 
for Phase 2, GEM calculates a vehicle's fuel consumption rate when it 
is stopped in traffic with the driver still operating the vehicle 
(i.e., ``drive idle'') and when the vehicle is stopped and parked with 
the engine still running (i.e., ``parked idle''). For each regulatory 
subcategory of tractor and vocational vehicle (e.g., sleeper cab 
tractor, day cab tractor, light heavy-duty urban vocational vehicle, 
heavy heavy-duty regional vocational vehicle, etc.), GEM applies the 
agencies' prescribed weighting factors to each of the three duty cycles 
and to each of the two idle fuel consumption rates to represent the 
fraction of city driving, urban highway driving, rural highway driving, 
drive idle, and parked idle that is typical of each subcategory. After 
combining the weighted results of all the cycles and idle fuel rates, 
GEM then outputs a single composite result for the vehicle, expressed 
as both fuel consumed in gallon per 1,000 ton-miles (for NHTSA 
standards) and an equivalent amount of CO2 emitted in grams 
per ton-mile (for EPA standards). These are the vehicle's GEM results 
that are used along with other information to demonstrate that a 
vehicle certificate holder (e.g., a vehicle manufacturer) complies with 
the applicable standards. This other information includes the annual 
sales volume of the vehicle family, plus information on emissions 
credits that may be generated or used as

[[Page 73539]]

part of that vehicle family's certification.
    For Phase 1 GEM's tractor inputs include vehicle aerodynamics 
information, tire rolling resistance, and whether or not a vehicle is 
equipped with lightweight materials, a tamper-proof speed limiter, or 
tamper-proof idle reduction technologies. Other vehicle and engine 
characteristics in GEM were fixed as defaults that cannot be altered by 
the user. These defaults included tabulated data of engine fuel rate as 
a function of engine speed and torque (i.e., ``engine fuel maps''), 
transmissions, axle ratios, and vehicle payloads. For tractors, Phase 1 
GEM simulates a tractor pulling a standard trailer. For vocational 
vehicles, Phase 1 GEM includes a fixed aerodynamic drag coefficient and 
vehicle frontal area.
    For Phase 2 new inputs are required and other new inputs are 
allowed as options. These include the outputs of new test procedures to 
``map'' an engine to generate steady-state and transient, cycle-
average, engine fuel rate inputs to represent the actual engine in a 
vehicle. As described in detail in RIA Chapter 4, certification to the 
Phase 2 standards will require entering new inputs into GEM to describe 
the vehicle's transmission type and its number of gears and gear 
ratios. Manufacturers must also enter attributes that describe the 
vehicle's drive axle(s) type, axle ratio and tire revolutions per mile. 
We are also finalizing a number of options to conduct additional 
component testing for the purpose of replacing some of the agencies' 
``default values'' in GEM with inputs that are based on component 
testing. These include optional axle and transmission power loss test 
procedures. We are also finalizing an optional powertrain test 
procedure that would replace both the required engine mapping and the 
agencies' default values for a transmission and its automated shift 
strategy. We are also finalizing an option to generate cycle-average 
maps for the 55 mph and 65 mph cycles in GEM. In addition, we have made 
a number of improvements to the aerodynamic coast-down test procedures 
and associated aerodynamic data analysis techniques. While these 
aerodynamic test and data analysis improvements are primarily intended 
for tractors, for Phase 2 we are providing a streamlined off-cycle 
credit pathway for vocational vehicle aerodynamic performance to be 
recognized in GEM.
    As proposed, we are finalizing a significantly expanded number of 
technologies that are recognized in GEM. These include recognizing 
lightweight thermoplastic materials, automatic tire inflation systems, 
advanced cruise control systems, workday idle reduction systems, and 
axle configurations that decrease the number of drive axles. In 
response to comments and data submitted to the agencies on the Phase 2 
proposal we are also finalizing inputs related to tire pressure 
monitoring systems and advanced electronically controlled vehicle coast 
systems.
    Although GEM is similar in concept to a number of other 
commercially available vehicle simulation computer programs, the 
applicability of GEM is unique. First, GEM was designed exclusively for 
manufacturers and regulated entities to certify tractor and vocational 
vehicle chassis to the agencies' fuel consumption and CO2 
emissions standards. For GEM to be effective for this purpose, the 
inputs to GEM include only information related to certain vehicle 
components and attributes that significantly impact vehicle fuel 
efficiency and CO2 emissions. For example, these include 
vehicle aerodynamics, tire rolling resistance, and powertrain component 
information. On the other hand, other attributes such as those related 
to a vehicle's suspension, frame strength, or interior features are not 
included, where these otherwise might be included in other commercially 
available vehicle simulation programs that are used for other purposes. 
Furthermore, the simulated payload, driver behavior and duty cycles in 
GEM cannot be changed. Keeping these values constant helps to ensure 
that all vehicles are simulated and certified in the same way. However, 
these fixed attributes in GEM largely preclude GEM from being of much 
use as a research tool for exploring the effects of payload, driver 
behavior and different duty cycles.
    Similar to Phase 1, GEM for Phase 2 is available free of charge for 
unlimited use, and the GEM source code is open source. That is, the 
programming source code of GEM is freely available upon request for 
anyone to examine, manipulate, and generally use without restriction. 
In contrast, commercially available vehicle simulation programs are 
generally not free and open source. Additional details of GEM are 
included in Chapter 4 of the RIA.
    GEM is a computer software program, and like all other software 
development processes the agencies periodically released a number of 
developmental versions of the GEM software for others to review and 
test during the Phase 2 rulemaking process. This type of user testing 
significantly helps the agencies detect and fix any problems or 
``bugs'' in the GEM software.
    As part of Phase 1, the agencies conducted a peer review of GEM 
version 1.0, which was the version released for the Phase 1 
proposal.148 149 In response to this peer review and to 
comments from stakeholders, EPA made changes to the version of GEM 
released with the Phase 1 final rule. Updates to the Phase 1 GEM were 
also made via Technical Amendments.\150\ The current version of Phase 1 
GEM is v2.0.1, which is the version applicable for the Phase 1 
standards.\150\ As part of the development of GEM for Phase 2, both a 
formal peer review \149\ and a series of expert reviews were 
conducted.151 152 153 154
---------------------------------------------------------------------------

    \148\ See 76 FR 57146-57147.
    \149\ U.S. Environmental Protection Agency. ``Peer Review of the 
Greenhouse Gas Emissions Model (GEM) and EPA's Response to 
Comments.'' EPA-420-R-11-007. Last access on November 24, 2014 at 
http://www3.epa.gov/otaq/climate/documents/420r11007.pdf.
    \150\ See EPA's Web site at http://www3.epa.gov/otaq/climate/gem.htm for the Phase 1 GEM revision dated May 2013, made to 
accommodate a revision to 49 CFR 535.6(b)(3).
    \151\ U.S. Environmental Protection Agency, GEM new release (GEM 
P2v1.1) and known issues and workarounds for GEM P2v1.0), Greenhouse 
Gas Emissions Standards and Fuel Efficiency Standards for Medium- 
and Heavy-Duty Engines and Vehicles--Phase 2--EPA-HQ-OAR-2014-0827, 
August 19, 2015.
    \152\ U.S. Environmental Protection Agency, GEM Power User 
Release for Debugging, Greenhouse Gas Emissions Standards and Fuel 
Efficiency Standards for Medium- and Heavy-Duty Engines and 
Vehicles--Phase 2--EPA-HQ-OAR-2014-0827, January 27, 2016.
    \153\ U.S. Environmental Protection Agency, GEM NODA Release, 
Greenhouse Gas Emissions Standards and Fuel Efficiency Standards for 
Medium- and Heavy-Duty Engines and Vehicles--Phase 2--EPA-HQ-OAR-
2014-0827, February 16, 2016.
    \154\ U.S. Environmental Protection Agency, GEM Power User 
Release for Debugging, Greenhouse Gas Emissions Standards and Fuel 
Efficiency Standards for Medium- and Heavy-Duty Engines and 
Vehicles--Phase 2--EPA-HQ-OAR-2014-0827, May 19, 2016.
---------------------------------------------------------------------------

    The agencies have provided numerous opportunities for comment on 
GEM, and its iterative development. Shortly after the Phase 2 
proposal's publication in July 2015 (and before the end of the public 
comment period), the agencies received comments on GEM. Based on these 
early comments, the agencies made minor revisions to fix a few bugs in 
GEM and in August 2015 released an updated version of GEM to the public 
for additional comment, which also included new information on GEM road 
grade profiles. The agencies also extended the public comment period on 
the proposal, which provided at least 30 days for public comment on 
this slightly updated version of GEM.\153\ Then, in response to 
comments submitted at the close of the comment period, in early January 
2016

[[Page 73540]]

the agencies released a ``debugging'' version of GEM to a wide range of 
expert reviewers.\152\ The agencies provided one month for expert 
reviewers to provide informal feedback for debugging purposes.\152\ 
Because the changes for this debugging version mostly added new 
features to make GEM easier to use for certifying via optional test 
procedures, like the powertrain test, there were only minor changes to 
the way that GEM performed. In the March 2016 NODA, the agencies 
included another developmental version of GEM \153\ for public comment 
and provided 30 days for public comment. Based on the NREL report, 
which was also released as part of the NODA for public comment, the 
NODA version of GEM contained updated weighting factors of the duty 
cycles and idle cycles.\155\ Therefore, the outputs of GEM for a given 
vehicle configuration changed because these duty cycle weighting 
factors changed, but there were only minor updates to how the 
individual technologies were simulated in GEM. Based on comments 
received on the NODA, the agencies made minor changes to GEM and 
released another debugging version in May 2016 to manufacturers, NGOs, 
suppliers, and CARB staff.\154\ The most significant change to GEM for 
the May 2016 version was that 0.5 miles of flat road was added to the 
beginning and end of the 55 mph and 65 mph drive cycles in response to 
concerns raised by manufacturers.\156\ This change did not change the 
way that GEM worked, but it did change GEM results because of the 
change in the duty cycles. This change was made to better align GEM 
simulation with real-world engine operation. The agencies provided the 
expert reviewers with at least a 3-week period in which to review GEM 
and provide feedback. Details on the history of the comments the 
agencies received and the history of the agencies responses leading to 
these multiple releases of GEM can be found in Section II.C.(1). The 
following list summarizes the changes in GEM in response to those 
comments and data submitted to the agencies in response to the Phase 2 
proposal, NODA and other GEM releases:
---------------------------------------------------------------------------

    \155\ EPA-HQ-OAR-2014-0827-1621 and NHTSA-2014-0132-0187.
    \156\ Memo to Docket, ``Summary of Meetings and Conference Calls 
with the Truck and Engine Manufacturers Association to Discuss the 
Phase 2 Heavy-Duty GHG Rulemaking'', August 2016.
---------------------------------------------------------------------------

     Revised road grade profiles for 55- and 65-mph cruise 
cycles, only minor changes since August 2015.
     Revised idle cycles for vocational vehicles with new 
vocational cycle weightings, weightings released for public comment in 
NODA.
     Made changes to the input file structures. Examples 
includes additions of columns for axle configuration (``6x2,'' ``6x4,'' 
``6x4D,'' ``4x2''), and additions of a few more technology improvement 
inputs, such as ``Neutral Idle,'' ``Start/Stop,'' and ``Automatic 
Engine Shutdown.'' These were minor changes, all were in NODA version 
of GEM.
     Made changes to the output file structures. Examples 
include an option to allow the user to select an output of detailed 
results on average speed, average work at the input and output of the 
transmission, and the numbers of shifts for each cycle (e.g., 55 mph 
cycle, 65 mph cycle and the ARB Transient cycle). These were minor 
changes, all were in NODA version of GEM.
     Added an input file for optional axle power losses 
(function of axle output speed and torque) and replaced a single axle 
efficiency value with lookup table of power loss. These were minor 
changes to streamline the use of GEM, all were in NODA version of GEM.
     Modified engine torque response to be more realistic, with 
a fast response region scaled by engine displacement, and a slower 
torque response in the turbo-charger's highly boosted region. These 
were minor changes, all were in NODA version of GEM.
     Added least-squares regression models to interpret cycle-
average fuel maps for all cycles. These were minor changes to 
streamline the use of GEM, all were in NODA version of GEM.
     Added different fuel properties according to 40 CFR 
1036.530. This was a fix to align GEM with regulations.
     Improved shift strategy based on testing data and comments 
received. These were minor changes, all were in NODA version of GEM.
     Added scaling factors for transmission loss and inertia, 
per regulatory subcategory. These were minor changes, all were in NODA 
version of GEM.
     Added optional input table for transmission power loss 
data. These were minor changes to streamline the use of GEM, all were 
in NODA version of GEM.
     Added minimum torque converter lock-up gear user input for 
automatic transmissions. This was a minor change to streamline the use 
of GEM, this change was in the NODA version of GEM.
     Revised the default transmission power loss tables, based 
on test data. This was a minor change to streamline the use of GEM, 
this change was in the NODA version of GEM.
     Added neutral idle and start/stop effects idle portions of 
the ARB Transient cycle. These were minor changes, all were in NODA 
version of GEM
     Adjusted shift and torque converter lockup strategy. This 
was a minor change to streamline the use of GEM, this change was in the 
NODA version of GEM.
    Notwithstanding these numerous opportunities for public comment (as 
well as many informal opportunities via individual meetings), some 
commenters maintained that they still had not received sufficient 
notice to provide informed comment because each proposal represented 
too much of a ``moving target.'' 157 158 159 The agencies 
disagree. Even at proposal, Phase 2 GEM provided nearly all of the 
essential features of the version we are promulgating in final form. 
These include: (1) The reconfiguration of the engine, transmission, and 
axle sub-models to reflect additional designs and to receive 
manufacturer inputs; and (2) the addition of road grade and idle cycles 
for vocational vehicles, along with revised weighting factors. 
Moreover, the changes the agencies have made to GEM in response to 
public comment indicates that those comments were highly informed by 
the proposal. The agencies thus do not accept the contention that 
commenters were not afforded sufficient information to provide 
meaningful comment on GEM.
---------------------------------------------------------------------------

    \157\ Memo to Docket, ``Summary of Meetings and Conference Calls 
with the Truck and Engine Manufacturers Association to Discuss the 
Phase 2 Heavy-Duty GHG Rulemaking'', August 2016.
    \158\ Memo to Docket, ``Summary of Meetings and Conference Calls 
with Allison Transmission to Discuss the Phase 2 Heavy-Duty GHG 
Rulemaking'', August 2016.
    \159\ ``Heavy-Duty Phase 2 Stakeholder Meeting Log'', August 
2016.
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(1) Description of Modifications to GEM From Phase 1 to Phase 2
    As explained above, GEM is a computer program that was originally 
developed by EPA specifically for manufacturers to use to certify to 
the Phase 1 tractor and vocational chassis standards. GEM 
mathematically combines the results of vehicle component test 
procedures with other vehicle attributes to determine a vehicle's 
certified levels of fuel consumption and CO2 emissions. 
Again as explained above, for Phase 1 the required inputs to GEM 
include vehicle aerodynamics information, tire rolling resistance, and 
whether or not a vehicle is equipped with certain lightweight

[[Page 73541]]

high-strength steel or aluminum components, a tamper-proof speed 
limiter, or tamper-proof idle reduction technologies for tractors. The 
vocational vehicle inputs to GEM for Phase 1 only included tire rolling 
resistance. For Phase 1 GEM's inputs did not include engine test 
results or attributes related to a vehicle's powertrain; namely, its 
transmission, drive axle(s), or loaded tire radius. Instead, for Phase 
1 the agencies specified a generic engine and powertrain within GEM, 
and for Phase 1 these cannot be changed in GEM.
    For this rulemaking, GEM has been modified as proposed and 
validated against a set of experimental data that represent over 130 
unique vehicle variants conducted at powertrain and chassis 
dynamometers with the manufacturers' provided transmission shifting 
tables. In addition, GEM has been validated against different types of 
tests when the EPA transmission default auto-shift strategy is used, 
which includes powertrain dynamometer tests and two truck tests running 
in a real-world driving route. Detailed comparisons can be seen in 
Chapter 4 of the RIA. As noted above, the agencies believe that this 
new version of GEM is an accurate and cost-effective alternative to 
measuring fuel consumption and CO2 over a chassis 
dynamometer test procedure. Again as noted earlier, some of the key 
modifications will require additional vehicle component test procedures 
(both mandatory and optional) to generate additional GEM inputs. The 
results of which will provide additional inputs into GEM. These include 
a new required engine test procedure to provide engine fuel consumption 
inputs into GEM. We proposed to measure fuel consumption as a matrix of 
steady-state points, but also sought comment on a newly developed 
engine test procedure that captures transient engine performance for 
use in GEM. We are specifying a combination of these procedures for the 
final rule--steady-state fuel maps for the highway cruise simulations, 
and cycle-average maps for transient simulations. As an option, cycle 
average maps could be also used for the highway cruise simulation as 
well. See Chapter 3 of the RIA for additional discussion of the fuel 
mapping procedures. We are also requiring inputs that describe the 
vehicle's transmission type, and its number of gears and gear ratios. 
We are allowing an optional powertrain test procedure that would 
provide inputs to override the agencies' simulated engine and 
transmission in GEM. In addition, in response to comments, we will also 
allow manufacturers to measure transmission efficiency in the form of 
the power loss tables to replace the default values in GEM. We are 
finalizing the proposed requirement to input a description of the 
vehicle's drive axle(s), including its type (e.g., 6x4 or 6x2) and axle 
ratio. We are also finalizing the optional axle efficiency test 
procedure for which we sought comment. This would allow manufacturers 
to override the agencies' simulated axle in GEM. Chapter 4 of the RIA 
details all of these GEM related input changes.
    As noted above, we are significantly expanding the number of 
technologies that are recognized in GEM. These include recognizing 
lightweight thermoplastic materials, automatic tire inflation systems, 
advanced cruise control systems, engine stop-start idle reduction 
systems, and axle configurations that decrease the number of drive 
axles. To better reflect real-world operation, we are also revising the 
vehicle simulation computer program's urban and rural highway duty 
cycles to include changes in road grade, and including a new duty cycle 
to capture the performance of technologies that reduce the amount of 
time a vehicle's engine is at idle during a workday. Finally, to better 
recognize that vocational vehicle powertrains are configured for 
particular applications, we are further subdividing the vocational 
chassis category into three different vehicle speed categories, where 
GEM weights the individual duty cycles' results of each of the speed 
categories differently. Section 4.2 of the RIA details all these 
modifications. The following sub-sections provide further details on 
some of these key modifications to GEM.
(a) Simulating Engines for Vehicle Certification
    Before describing the Phase 2 approach, this section first reviews 
how engines are simulated for vehicle certification in Phase 1. As 
noted earlier, GEM for Phase 1 simulates the same generic engine for 
any vehicle in a given regulatory subcategory with a data table of 
steady-state engine fuel consumption mass rates (g/s) versus a series 
of steady-state engine output shaft speeds (revolutions per minute, 
rpm) and loads (torque, N[middot]m). This data table is also sometimes 
called a ``fuel map'' or an ``engine map,'' although the term ``engine 
map'' can mean other kinds of data in different contexts. The engine 
speeds in this map range from idle to maximum governed speed and the 
loads range from engine motoring (negative load) to the maximum load of 
an engine. When GEM executes a simulation over a vehicle duty cycle, 
this data table is linearly interpolated to find a corresponding fuel 
consumption mass rate at each engine speed and load that is demanded by 
the simulated vehicle operating over the duty cycle. The fuel 
consumption mass rate of the engine is then integrated over each duty 
cycle in GEM to arrive at the total mass of fuel consumed for the 
specific vehicle and duty cycle. Under Phase 1, manufacturers were not 
allowed to input their own engine fuel maps to represent their specific 
engines in the vehicle being simulated in GEM. Because GEM was 
programmed with fixed engine fuel maps for Phase 1 that all 
manufacturers had to use, the tables themselves did not have to exactly 
represent how an actual engine might operate over these three different 
duty cycles.
    In contrast, for Phase 2 we are requiring manufacturers to generate 
their own engine fuel maps to represent each of their engine families 
in GEM. This Phase 2 approach is consistent with the 2014 NAS Phase 2 
First Report recommendation.\160\ To investigate this approach, before 
proposal we examined the results from 28 individual engine dynamometer 
tests. Three different engines were used to generate this data, and 
these engines were produced by two different engine manufacturers. One 
engine was tested at three different power ratings (13 liters at 410, 
450 & 475 bhp) and one engine was tested at two ratings (6.7 liters at 
240 and 300 bhp), and other engine with one rating (15 liters 455 bhp) 
service classes. For each engine and rating the steady-state engine 
dynamometer test procedure was conducted to generate an engine fuel map 
to represent that particular engine in GEM. Next, with GEM, we 
simulated various vehicles in which the engine could be installed. For 
each of the GEM duty cycles we are using, namely the urban local (ARB 
Transient), urban highway with road grade (55 mph), and rural highway 
with road grade (65 mph) duty cycles, we determined the GEM result for 
each vehicle configuration, and we saved the engine output shaft speed 
and torque information that GEM created to interpolate the steady-state 
engine map for each vehicle configuration We then had this same engine 
output shaft speed and torque information programmed into an engine 
dynamometer controller, and we had each engine perform the same duty 
cycles that GEM demanded of the

[[Page 73542]]

simulated version of the engine. We then compared the GEM results based 
on GEM's linear interpolation of the engine maps to the measured engine 
dynamometer results. We concluded that for the 55 mph and 65 mph duty 
cycles, GEM's interpolation of the steady-state data tables was 
sufficiently accurate versus the measured results. This is an outcome 
one would reasonably expect because even with changes in road grade, 
the 55 mph and 65 mph duty cycles do not demand rapid changes in engine 
speed or load. The 55 mph and 65 mph duty cycles are nearly steady-
state, as far as engine operation is concerned, just like the engine 
maps themselves. However, for the ARB Transient cycle, we observed a 
consistent bias when using the steady-state maps, where GEM 
consistently under-predicted fuel consumption and CO2 
emissions. This low bias over the 28 engine tests ranged from 4.2 
percent low to 7.8 percent low. The mean was 5.9 percent low and the 
90th percentile value was 7.1 percent low. These observations are 
consistent with the fact that engines generally operate less 
efficiently under transient conditions than under steady-state 
conditions.
---------------------------------------------------------------------------

    \160\ National Academy of Science. ``Reducing the Fuel 
Consumption and GHG Emissions of Medium- and Heavy-Duty Vehicles, 
Phase Two, First Report.'' 2014. Recommendation 3.8.
---------------------------------------------------------------------------

    A number of reasons explain this consistent trend. For example, 
under rapidly changing (i.e. transient) engine conditions, it is 
generally more challenging to program an engine electronic controller 
to respond with optimum fuel injection rate and timing, exhaust gas 
recirculation valve position, variable nozzle turbocharger vane 
position and other set points than under steady-state conditions. 
Transient heat and mass transfer within the intake, exhaust, and 
combustion chambers also tend to increase turbulence and enhance energy 
loss to engine coolant during transient operation. In many cases during 
cold transient operation, the thermal management is triggered in order 
to maintain optimal performance of selective catalytic reduction 
devices for a diesel engine. Furthermore, because exhaust emissions 
control is more challenging under transient engine operation, 
engineering tradeoffs sometimes need to be made between fuel efficiency 
and transient criteria pollutant emissions control. Special 
calibrations are typically also required to control smoke and manage 
exhaust temperatures during transient operation for a transient cycle.
    To account for these effects in GEM, the agencies have developed 
and are finalizing a test procedure called ``cycle average'' mapping to 
account for this transient behavior (40 CFR 1036.540). Detailed 
analyses and presentation of the test procedure was published in two 
peer-reviewed journal articles.\139,140\ A number of commenters 
likewise suggested this approach. Additionally, progress has been made 
on further improving this test procedure since publication, based on a 
large number of engine dynamometer tests conducted by a variety of 
laboratory test facilities.\161\ Since the proposal, further refinement 
of the numerical schemes used for interpreting cycle average engine 
fuel map was also completed. The engine dynamometer tests include a 
Cummins medium duty ISB engine, a Navistar heavy duty N13 engine, a 
Volvo heavy duty D13 engine, and a Cummins heavy duty ISX engine. All 
testing results indicated that the new test procedure works well for 
the transient ARB cycle.\162\ In addition, Cummins in their NODA 
comments (see the following paragraph) provided additional data 
supporting this approach with their ISL 450 bhp rating engine. This 
data corroborated earlier data showing good agreement between engine 
dynamometer tests and the cycle average engine mapping approach.\163\
---------------------------------------------------------------------------

    \161\ Memos to Docket, ``Test Procedure Review with Cummins, 
Volvo, Navistar, Paccar, Daimler Eaton and Allison.''
    \162\ Michael Ross, Validation Testing for Phase 2 Greenhouse 
Gas Test Procedures and the Greenhouse Gas Emission Model (GEM) for 
Medium and Heavy-Duty Engines and Powertrains, Final Report to EPA, 
Southwest Research Institute, June 2016, found in docket of this 
rulemaking, EPA-HQ-QAR-2014-0827.
    \163\ Cummins NODA Comments, found in Phase 2 Docket: ID No. 
EPA-HQ-OAR-2014-0817, April 1, 2016.
---------------------------------------------------------------------------

    EPA solicited comment on the cycle average approach at proposal. 80 
FR 40193. EPA also specifically provided notice and a 30-day 
opportunity for public comment on the possibility of requiring use of 
the cycle average mapping approach for the ARB Transient cycle. This 
was included in the version of GEM that was made available for public 
comment as part of the NODA \153\. In response, many comments were 
received on the cycle average approach. These include comments from 
Cummins \163\ and Volvo.\164\ Cummins was very supportive of the cycle 
average approach and also supported applying this approach to the 55 
mph and 65 mph cruise cycles in GEM. Volvo expressed some concern over 
having enough time to fully evaluate this approach. The agencies 
believe that one of the reasons that Volvo expressed concern over 
having enough time to evaluate this approach is because Volvo initially 
declined working with the agencies to collaboratively refine this 
approach. At the same time, a number of Volvo's competitors chose to 
actively coordinate laboratory testing and technical analysis to 
contribute to the development of this approach. We believe these other 
manufacturers gained a deeper understanding of the approach earlier 
than Volvo because they invested time and resources to make technical 
contributions at earlier point in time. Nevertheless, the agencies 
fully welcome and appreciate Volvo's more recent active involvement in 
reviewing the cycle average approach and for making a number of 
productive suggestions for further refinement.
---------------------------------------------------------------------------

    \164\ Volvo Group NODA Comments, found in Phase 2 Docket: ID No. 
EPA-HQ-OAR-2014-0817, April 1, 2016.
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    While the agencies are finalizing the cycle average engine mapping 
test procedure as mandatory for the ARB Transient cycle, for the 55 mph 
and 65 mph GEM drive cycles, the agencies are finalizing the same 
steady-state mapping procedure that the agencies originally proposed. 
The only difference is that we are finalizing about 85 unique steady-
state map points, versus the about 143 points that were proposed. See 
40 CFR 1036.535 for details. We are adopting a lower number of points 
because many of the originally proposed points were specified for use 
with the ARB Transient cycle.\139\ Again, as an option, the cycle 
average mapping test procedure also may be used for these two cruise 
speed cycles, in lieu of the steady-state mapping procedure.
(b) Simulating Human Driver Behavior and Transmissions for Vehicle 
Certification
    GEM for Phase 1 simulates the same generic human driver behavior 
and manual transmission shifting patterns for all vehicles. The 
simulated driver responds to changes in the target vehicle speed of the 
duty cycles by changing the simulated positions of the vehicle's 
accelerator pedal, brake pedal, clutch pedal, and gear shift lever. For 
simplicity, in Phase 1 the GEM driver shifted at pre-specified vehicle 
speeds and the manual transmission was simulated as an ideal 
transmission that did not have any delay time (i.e., torque 
interruption) between gear shifts and did not have any energy losses 
associated with clutch slip during gear shifts.
    In GEM for Phase 2 we are allowing manufacturers to select one of 
four types of transmissions to represent the transmission in the 
vehicle they are certifying: Manual transmission (MT), automated manual 
transmission (AMT), automatic transmission (AT) and dual clutch 
transmission (DCT). For Phase 2 the agencies proposed unique 
transmission shifting patters to

[[Page 73543]]

represent the different types of automated transmissions. These 
shifting patterns over the steady state cruise cycles has been further 
modified from the proposed version to be more realistic with respect to 
slight variations in vehicle speed due to road grade. In particular, 
when going downhill, the simulated vehicle is now allowed to exceed the 
speed target by 3 mph before the brakes are applied. In the proposed 
version, the driver model applied the brakes much sooner to prevent the 
vehicle from exceeding the speed target. This change allows the vehicle 
to carry additional momentum into the next hill, much the same as real 
drivers would.
    In the final version of GEM, the driver behavior and the different 
transmission types are simulated in the same basic manner as in Phase 
1, but each transmission type features unique transmission responses 
that match the transmission responses we measured during vehicle 
testing of these three transmission types. In general the transmission 
gear shifting strategy for all of the transmissions is designed to 
shift the transmission so that it is in the most efficient gear for the 
current vehicle demand, while staying within certain limits to prevent 
unrealistically high frequency shifting (i.e., to prevent ``short-
shifting''). Some examples of these limits are torque reserve limits 
(which vary as function of engine speed), minimum time-in-gear and 
minimum fuel efficiency benefit to shift to the next gear. Some of the 
differences between the transmission types include a driver ``double-
clutching'' during gear shifts of the manual transmission only, and 
``power shifts'' and torque converter torque multiplication, slip, and 
lock-up in automatic transmissions only. Refer to Chapter 4 of the RIA 
for a more detailed description of these different simulated driver 
behaviors and transmission types.
    Prior to the proposal, we considered an alternative approach where 
transmission manufacturers would provide vehicle manufacturers with 
detailed information about their automated transmissions' proprietary 
shift strategies for representation in GEM. NAS also recommended this 
approach.\165\ The advantages of this approach would include a more 
realistic representation of a transmission in GEM and potentially the 
recognition of additional fuel efficiency improving strategies to 
achieve additional fuel consumption and CO2 emissions 
reductions. However, there are a number of technical and compliance 
disadvantages of this approach. One disadvantage is that it would 
require the disclosure of proprietary information because some vehicle 
manufacturers produce their own transmissions and also use other 
suppliers' transmissions. There are technical challenges too. For 
example, some transmission manufacturers have upwards of 40 different 
shift strategies programmed into their transmission controllers. 
Depending on in-use driving conditions, some of which are not simulated 
in GEM (e.g., changing payloads, changing tire traction) a transmission 
controller can change its shift strategy. Representing dynamic 
switching between multiple proprietary shift strategies would be 
extremely complex to simulate in GEM. Furthermore, if the agencies were 
to require transmission manufacturers to provide shift strategy inputs 
for use in GEM, then the agencies would have to devise a compliance 
strategy to monitor in-use shift strategies, including a driver 
behavior model that could be implemented as part of an in-use shift 
strategy confirmatory test. This too would be very complex. If 
manufacturers were subject to in-use compliance requirements of their 
transmission shift strategies, this could lead to restricting the use 
of certain shift strategies in the heavy-duty sector, which would in 
turn potentially lead to sub-optimal vehicle configurations that do not 
improve fuel efficiency or adequately serve the wide range of customer 
needs; especially in the vocational vehicle segment. For example, if 
the agencies were to restrict the use of more aggressive and less fuel 
efficient in-use shift strategies that are used only under heavy loads 
and steep grades, then certain vehicle applications would need to 
compensate for this loss of capability through the installation of 
over-sized and over-powered engines that are subsequently poorly 
matched and less efficient under lighter load conditions. Therefore, as 
a policy consideration to preserve vehicle configuration choice and to 
preserve the full capability of heavy-duty vehicles today, the agencies 
are intentionally not allowing transmission manufacturers to submit 
detailed proprietary shift strategy information to vehicle 
manufacturers to input into GEM. The agencies are finalizing as 
proposed that vehicle manufacturers can choose from among several 
transmission types that the agencies have already developed, validated, 
and programmed into GEM. The vehicle manufacturers will then enter into 
GEM their particular transmission's number of gears and gear ratios, 
optionally together with power loss tables representing their 
transmission's gear friction, pumping and spin losses. If a 
manufacturer chooses to use the optional powertrain test procedure, 
however, then the agencies' transmission types in GEM would be 
overridden by the actual data collected during the powertrain test, 
which would recognize the transmission's unique shift strategy. 
(Presumably, vehicle manufacturers will choose to use the optional 
powertrain test procedure only if their actual transmission shift 
strategy is more efficient compared to its respective default shift 
strategy simulated by GEM.)
---------------------------------------------------------------------------

    \165\ Transportation Research Board 2014. ``Reducing the Fuel 
Consumption and Greenhouse Gas Emissions of Medium- and Heavy-Duty 
Vehicles, Phase Two.'' (``Phase 2 First Report'') Washington, DC, 
The National Academies Press. Cooperative Agreement DTNH22-12-00389. 
Available electronically from the National Academy Press Web site at 
http://www.nap.edu/catalog.php?record_id=12845 (last accessed 
December 2, 2014). Recommendation 3.7.
---------------------------------------------------------------------------

(c) Simulating Axles for Vehicle Certification
    In GEM for Phase 1 the axle ratio of the primary drive axle and the 
energy losses assumed in the simulated axle itself were the same for 
all vehicles. For Phase 2 the vehicle manufacturer will be required to 
input into GEM the axle ratio of the primary drive axle. This input 
will recognize the design to operate the engine at a particular engine 
speed when the transmission is operating in its highest transmission 
gear; especially for the 55 mph and 65 mph duty cycles in GEM. This 
input facilitates GEM's recognition of vehicle designs that take 
advantage of operating the engine at the lowest possible engine speeds. 
This is commonly known as ``engine down-speeding,'' and the general 
rule-of-thumb for heavy-duty engines is that for every 100 rpm decrease 
in engine speed, there can be about a 1 percent decrease in fuel 
consumption and CO2 emissions. Therefore, it is important 
that GEM allow this value to be input by the vehicle manufacturer. Axle 
ratio is also straightforward to verify during any in-use compliance 
audit. UCS and ACEEE commented that engine down-speeding should be 
recognized in the agencies' separate engine standards, rather than in 
the vehicle standard. The agencies disagree with this because 
recognizing down-speeding at the vehicle level ensures that the 
powertrain configuration in-use, in the real world, will lead to the 
engine operating at lower speeds. In contrast, the engine speeds 
specified in the separate engine standards' test procedures are based 
on the engine's maximum torque versus speed curve (i.e., lug curve) and 
not on the configuration of the powertrain to

[[Page 73544]]

which the engine is attached in a vehicle. This means that even if a 
manufacturer manipulated the engine's lug curve such that the separate 
engine standards' test procedure led to the engine operating at lower 
speeds during certification, that same engine could be installed in a 
vehicle with a powertrain configured for the engine to operate at 
higher engine speeds. Therefore, recognizing down-speeding within GEM, 
at the vehicle level, best ensures that the agencies' test procedures 
and standards lead to real-world engine down-speeding in-use.
    We proposed to use a fixed axle ratio energy efficiency of 95.5 
percent at all speeds and loads, but requested comment on whether this 
pre-specified efficiency is reasonable. 80 FR 40185. In general, 
commenters stated that the efficiency of the axle actually varies as a 
function of axle ratio, axle speed, and axle input torque. Therefore, 
we have modified GEM to accept an input data table of power loss as a 
function of axle speed and axle torque. The modified version of GEM 
subsequently interpolates this table over each of the duty cycles to 
represent a more realistic axle efficiency at each point of each duty 
cycle. The agencies specify a default axle efficiency table in GEM for 
any manufacturer to use. We are also finalizing an optional axle power 
loss test procedure that requires the use of a dynamometer test 
facility (40 CFR 1037.560). With this optional test procedure, a 
manufacturer can create an axle efficiency table for use in lieu of the 
EPA default table. We requested comment on this test procedure in the 
proposal, and we received supportive comments. Refer to 40 CFR 1037.560 
of the Phase 2 regulations, which contain this test procedure.
    Moreover, the final regulations allow the manufacturers to develop 
analytical methods to derive axle efficiency tables for untested axle 
configurations, based on testing of similar axles. This would be 
similar to the analytically derived CO2 emission 
calculations allowed for pickups and vans. However, manufacturers would 
be required to obtain prior approval from the agencies before using 
analytically derived values. In addition, the agencies could conduct 
confirmatory testing or require a selective enforcement audit for any 
axle configuration. See 40 CFR 1037.235.
    In addition to requiring the primary drive axle ratio input into 
GEM (and an option to input an actual axle power loss data table), we 
are requiring that the vehicle manufacturer input into GEM whether one 
or two drive axles are driven by the engine. When a heavy-duty vehicle 
is equipped with two rear axles where both are driven by the engine, 
this is called a ``6x4'' configuration. ``6'' refers to the total 
number of wheel hubs on the vehicle. In the 6x4 configuration there are 
two front wheel hubs for the two steer wheels and tires plus four rear 
wheel hubs for the four rear wheels and tires (or more commonly four 
sets of rear dual wheels and tires). ``4'' refers to the number of 
wheel hubs driven by the engine. These are the two rear axles that have 
two wheel hubs each. Compared to a 6x4 configuration, a 6x2 
configuration decreases axle energy loss due to friction and oil 
churning in two driven axles, by driving only one axle. The decrease in 
fuel consumption and CO2 emissions associated with a 6x2 
versus 6x4 axle configuration can be in the range of 2.5 percent 
depending on specific axles, which is modeled by the power loss 
table.\166\ Therefore, in the Phase 2 version of GEM, if a manufacturer 
simulates a 6x2 axle configuration using the default axle efficiencies, 
GEM decreases the overall GEM result roughly by 2.5 percent on average 
through the power loss table. Note that GEM will similarly decrease the 
overall GEM result by 2.5 percent for a 4x2 tractor or Class 8 
vocational chassis configuration if it has only two wheel hubs driven. 
If a manufacturer does not use the default efficiencies, the benefit of 
6x2 and 4x2 configurations will be reflected directly in its input 
tables. Note that the Phase 2 version of GEM does not have an option to 
simulate more than two drive axles or configurations where the front 
axle(s) are driven or where there are more than two rear axles. The 
regulations specify that such vehicles are to be simulated as 6x4 
vehicles in GEM. This is consistent with how the standards were 
developed and the agencies believe this approach will provide the 
appropriate incentive for manufacturers to apply the same fuel saving 
technologies to these vehicles, as they would to their conventional 6x4 
vehicles. Moreover, because these configurations are manufactured for 
specialized vehicles that require extra traction for off-road 
applications, they have very low sales volume and any increased fuel 
consumption and CO2 emissions from them are not significant 
in comparison to the overall reductions of the Phase 2 program. Note 
that 40 CFR 1037.631 (for off-road vocational vehicles), which is being 
continued from the Phase 1 program, exempts many of these vehicles from 
the vehicle standards because they are limited mechanically to low-
speed operation.
---------------------------------------------------------------------------

    \166\ NACFE. Executive Report--6x2 (Dead Axle) Tractors. 
November 2010. See Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

(d) Simulating Accessories for Vehicle Certification
    The agencies proposed to continue the approach from Phase 1 whereby 
GEM uses a fixed power consumption value to simulate the fuel consumed 
for powering accessories such as steering pumps and alternators. 80 FR 
40186. The final rule continues the Phase 1 approach, as proposed. 
However, Phase 2 GEM provides an option to provide a GEM input 
reflecting technology improvement inputs for the accessory loads. This 
allows the manufacturers to receive credit for those technologies that 
are not modeled in GEM. Manufacturers seeking credit for those 
technologies that are not modeled in GEM would generally follow the 
off-cycle credit program procedures in 40 CFR 1037.610.
(e) Aerodynamics in GEM for Tractor, Vocational Vehicle, and Trailer 
Certification
    Phase 2 GEM simulates aerodynamic drag in using CdA (the 
product of the drag coefficient and frontal area of the vehicle) rather 
than a drag coefficient (Cd). For tractors and trailers we 
will continue to use an aerodynamic bin approach similar to the one 
that exists in Phase 1 today, although the actual Phase 2 bins are 
being revised to reflect new test procedures and our projections for 
more aerodynamic tractors and trailers in the future. This approach 
allows manufacturers to determine CdA (or delta-
CdA in the case of trailers) from coastdown testing, scale 
wind tunnel testing and/or computational fluid dynamics modeling. It 
requires tractor manufacturers (but not trailer manufacturers) to 
conduct a certain minimum amount of coast-down vehicle testing to 
validate their methods. The regulations also provide an alternate path 
for trailer manufacturers to rely on testing performed by component 
suppliers. See 40 CFR 1037.
    The results of these tests determine into which bin a tractor or 
trailer is assigned. GEM uses the aerodynamic drag coefficient 
applicable to the bin, which is the same for all tractors (or trailers) 
within a given bin. This approach helps to account for limits in the 
repeatability of aerodynamic testing and it creates a compliance margin 
since any test result which keeps the vehicle in the same aerodynamic 
bin is considered compliant. For Phase 2 we are establishing new 
boundary values for the bins themselves and we are adding two 
additional tractor bins in order to recognize further advances in

[[Page 73545]]

aerodynamic drag reduction beyond what was recognized in Phase 1. 
Furthermore, while Phase 1 GEM used predefined frontal areas for 
tractors where the manufacturers input only a Cd value, 
manufacturers will use a measured drag area (CdA) value for 
each tractor configuration for Phase 2. See 40 CFR 1037.525. The 
agencies do not project that vocational vehicles will need to improve 
their aerodynamic performance to comply with the Phase 2 vocational 
chassis standards. However, the agencies are providing features in GEM 
for vocational vehicles to receive credit for improving the 
aerodynamics of vocational vehicles (see 40 CFR 1037.520(m)).
    In addition to these changes, we are making a number of aerodynamic 
drag test procedure improvements. One improvement is to update the 
``standard trailer'' that is prescribed for use during aerodynamic drag 
testing of a tractor. Using the CdA from such testing means 
the standard trailer would also be the hypothetical trailer modeled in 
GEM to represent a trailer paired with the tractor in actual use.\167\ 
In Phase 1, a non-aerodynamic 53-foot long box-shaped dry van trailer 
was specified as the standard trailer for tractor aerodynamic testing 
(see 40 CFR 1037.501(g)). For Phase 2 we are modifying this standard 
trailer for tractor testing to make it more similar to the trailers we 
expect to be produced during the Phase 2 timeframe. More specifically, 
we are prescribing the installation of aerodynamic trailer skirts (and 
low rolling resistance tires as applied in Phase 1) on the standard 
trailer, as discussed in further in Section III.E.2. As explained more 
fully in Sections III and IV, the agencies believe that tractor-trailer 
pairings will be optimized aerodynamically to a significant extent in-
use (such as using high-roof cabs when pulling box trailers), and that 
this real-world optimization should be reflected in the certification 
testing. We are also revising the test procedures to better account for 
average wind yaw angle to reflect the true impact of aerodynamic 
features on the in-use fuel consumption and CO2 emissions of 
tractors, again as discussed in more detail in Section III below. Refer 
to the test procedures in 40 CFR 1037.525 through 1037.527 for further 
details of these aerodynamic test procedures.
---------------------------------------------------------------------------

    \167\ See Section III. for a discussion of how GEM will model a 
more advanced trailer beginning with the 2027 model year.
---------------------------------------------------------------------------

    For trailer certification, the agencies use GEM in a different way 
than it is used for tractor certification. As described in Section IV, 
the agencies developed a simple equation to replicate GEM performance. 
The trailer standards are based on this equation, and trailer 
manufacturers use this GEM-based equation for certification. The only 
technologies recognized by this GEM-based equation for trailer 
certification are aerodynamic technologies, tire technologies 
(including tire rolling resistance and tire pressure systems), and 
weight reduction. Note that since the purpose of this equation is to 
replicate GEM performance, it can be considered as simply another form 
of the model using a different input interface. Thus, for simplicity, 
the remainder of this Section II.C. sometimes discusses GEM as being 
used for trailers, without regard to how manufacturers will actually 
input GEM variables. As with all of the standards in Phase 2, 
compliance is measured consistent with the same test methods used by 
the agencies to establish the standard.
    Similar to tractor certification, trailer manufacturers will use 
data from aerodynamic testing (e.g., coastdown testing, scale wind 
tunnel testing, computational fluid dynamics modeling, or possibly 
aerodynamic component testing) with the equation.\168\ As part of the 
protocol for generating these inputs, the agencies are specifying the 
configuration of a reference tractor for conducting trailer testing. 
Refer to Section IV of this Preamble and to 40 CFR 1037.501 of the 
regulations for details on the reference tractor configuration for 
trailer test procedures.
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    \168\ The agencies project that more than enough aerodynamic 
component vendors will take advantage of proposed optional pre-
approval process to make testing optional for trailer manufacturer.
---------------------------------------------------------------------------

    Finally, GEM has been modified to accept an optional delta 
CdA value for vocational chassis, to simulate aerodynamic 
improvements relative to pre-specified baseline defined in Chapter 4 of 
RIA. For example, a manufacturer that demonstrates that adding side 
skirts to a box truck reduces its CdA by 0.2 m\2\ could 
input that value into GEM for box trucks that include those skirts. See 
40 CFR 1037.520(m).
(f) Tires and Tire Inflation Systems for Truck and Trailer 
Certification
    For GEM in Phase 1 tractor and vocational chassis manufacturers 
input the tire rolling resistance of steer and drive tires directly 
into GEM. The agencies prescribed an internationally recognized tire 
rolling resistance test procedure, ISO 28580, for determining the tire 
rolling resistance value that is input into GEM, as described in 40 CFR 
1037.520(c). For Phase 2 we will continue this same approach and the 
use of ISO 28580, and we are expanding these requirements to trailer 
tires as well.
    In addition to tire rolling resistance, Phase 2 vehicle 
manufacturers will enter into GEM the tire manufacturer's specified 
revolutions per distance directly (revs/mile) for the vehicle's drive 
tires. This value is commonly reported by tire manufacturers already so 
that vehicle speedometers can be adjusted appropriately. This input 
value is needed so that GEM can accurately convert simulated vehicle 
speed into axle speed, transmission speed, and ultimately engine speed.
    For tractors and trailers, we proposed to allow manufacturers to 
specify whether or not an automatic tire inflation system (ATIS) is 
installed. 80 FR 40187. Based on comments and as discussed further in 
Sections III, IV, and V, in the Phase 2 final rule we are adopting 
provisions that allow manufacturers of tractors, trailers, and 
vocational vehicle chassis to input a percent decrease in overall fuel 
consumption and CO2 emissions into GEM if the vehicle 
includes either an ATIS or a tire pressure monitoring system (TPMS). 
The value that can be input depends on whether a TPMS or ATIS is 
deployed. See 40 CFR 1037.520.
(g) Weight Reduction for Tractor, Vocational Chassis and Trailer 
Certification
    Phase 2 GEM continues the weight reduction recognition approach in 
Phase 1, where the agencies prescribe fixed weight reductions, or 
``deltas,'' for using certain lightweight materials for certain vehicle 
components. In Phase 1 the agencies published a list of weight 
reductions for using high-strength steel and aluminum materials on a 
part by part basis. For Phase 2 we use updated values for high-strength 
steel and aluminum parts for tractors and for trailers and we have 
scaled these values for use in certifying the different weight classes 
of vocational chassis. In addition we use a similar part by part weight 
reduction list for tractor parts made from thermoplastic material. We 
proposed to assign a fixed weight increase to natural gas fueled 
vehicles to reflect the weight increase of natural gas fuel tanks 
versus gasoline or diesel tanks, but we are not finalizing that 
provision based on comments. 80 FR 40187. Commenters opposing this 
provision generally noted that the proposed provision was not 
consistent with how the agencies were treating other technologies. We 
agree that

[[Page 73546]]

natural gas vehicles should be treated consistently with other 
technologies and so are not adopting the proposed provision.
    For tractors, we will continue the same mathematical approach in 
GEM to assign \1/3\ of a total weight decrease to a payload increase 
and \2/3\ of the total weight decrease to a vehicle mass decrease. For 
Phase 1, these ratios were based on the average frequency that a 
tractor operates at its gross combined weight rating. We will also use 
these ratios for trailers in Phase 2. For vocational chassis, for which 
Phase 1 did not address weight reduction, we will assign \1/2\ of a 
total weight decrease to a payload increase and \1/2\ of the total 
weight decrease to a vehicle mass decrease.
(h) GEM Duty Cycles for Tractor, Vocational Chassis and Trailer 
Certification
    In Phase 1, there are three GEM vehicle duty cycles that represent 
stop-and-go city driving (ARB Transient), urban highway driving (55 
mph), and rural interstate highway driving (65 mph). In Phase 1 these 
cycles were time-based. That is, they were specified as a function of 
simulated time and the duty cycles ended once the specified time 
elapsed in simulation. The agencies proposed to continue to use these 
three drive cycles in Phase 2, but with some revisions. 80 FR 40187. We 
are finalizing revisions similar but not identical to those that were 
proposed. First, GEM will simulate these cycles on a distance-based 
specification, rather than on a time-based specification. A distance-
based specification ensures that even if a vehicle in simulation does 
not always achieve the target vehicle speed, the vehicle will have to 
continue in simulation for a longer period to complete the duty cycle. 
This ensures that vehicles are evaluated over the complete distance of 
the duty cycle and not just the portion of the duty cycle that a 
vehicle completes in a given time period. A distance-based duty cycle 
specification also facilitates a straightforward specification of road 
grade as a function of distance along the duty cycle. As noted in 
above, for Phase 2, the agencies have enhanced the 55 mph and 65 mph 
duty cycles by adding representative road grade to exercise the 
simulated vehicle's engine, transmission, axle, and tires in a more 
realistic way. A flat road grade profile over a constant speed test 
does not properly simulate a transmission with respect to shifting 
gears, and may have the unintended consequence of enabling underpowered 
vehicles or excessively down-sped drivetrains to generate credits, when 
in actuality the engine does not remain down-sped in-use when the 
vehicle encounters road grades. The road grade profile being finalized 
is the same hill and valley profile for both the 55 mph and 65 mph duty 
cycles, and is based on statistical analysis of the United States' 
national distribution of road grades. Although the final profile is 
different than that proposed, the agencies provided notice of the 
analysis that was used to generate the final profile.\169\ In written 
comments, we received in-use engine data from some manufacturers, and 
based on this information we made minor adjustments to the road grade 
to ensure that engines simulated in GEM operated similarly to that 
reported in the in-use engine data submitted to us. See Section 
III.E.(2)(b) of this document and Chapter 3.4.2.1 of the RIA for more 
details on development of the road grade profile. We believe that the 
enhancement of the 55 mph and 65 mph duty cycles with road grade is 
consistent with the NAS recommendation regarding road grade.\170\
---------------------------------------------------------------------------

    \169\ See National Renewable Energy Laboratory report ``EPA GHG 
Certification of Medium- and Heavy-Duty Vehicles: Development of 
Road Grade Profiles Representative of US Controlled Access 
Highways'' dated May 2015 and EPA memorandum ``Development of an 
Alternative, Nationally Representative, Activity Weighted Road Grade 
Profile for Use in EPA GHG Certification of Medium- and Heavy-Duty 
Vehicles'' dated May 13, 2015, both available in Docket EPA-HQ-OAR-
2014-0827. This docket also includes file 
NREL_SyntheticAndLocalGradeProfiles.xlsx which contains numerical 
representations of all road grade profiles described in the NREL 
report.
    \170\ NAS 2010 Report. Page 189. ``A fundamental concern raised 
by the committee and those who testified during our public sessions 
was the tension between the need to set a uniform test cycle for 
regulatory purposes, and existing industry practices of seeking to 
minimize the fuel consumption of medium and heavy-duty vehicles 
designed for specific routes that may include grades, loads, work 
tasks or speeds inconsistent with the regulatory test cycle. This 
highlights the critical importance of achieving fidelity between 
certification values and real-world results to avoid decisions that 
hurt rather than help real-world fuel consumption.''
---------------------------------------------------------------------------

(i) Workday Idle Operation for Vocational Chassis Certification
    In the Phase 1 program, reduction in idle emissions was recognized 
only for sleeper cab tractors, and only with respect to hoteling idle, 
where a driver needs power to operate heating, ventilation, air 
conditioning and other electrical equipment in order to use the sleeper 
cab to eat, rest, or conduct other business. As described in Section V, 
GEM for Phase 2 will recognize technologies that reduce workday idle 
emissions, such as automatic stop-start systems, daytime parked idle 
automatic engine shutdown systems, and transmissions that either 
automatically or inherently shift to neutral at idle while in drive. 
Many vocational vehicle applications operate on patterns implicating 
workday idle cycles, and the agencies use test procedures in GEM to 
account specifically for these cycles and potential idle controls. GEM 
will recognize these idle controls in two ways. For technologies like 
neutral-idle transmissions and stop-start systems that address idle 
that occurs during vehicle operation when the vehicle is stopped at a 
stop light, GEM will interpolate lower fuel rates from the engine map 
during the idle portions of the ARB Transient and during a separate GEM 
``drive idle cycle.'' For technologies like start-stop and auto-
shutdown that eliminate some of the idle that occurs when a vehicle is 
stopped or parked, GEM will assign a value of zero fuel rate during a 
separate GEM ``parked idle cycle.'' The idle cycles will be weighted 
along with the 65 mph, 55 mph, and ARB Transient duty cycles, according 
to the new vocational chassis duty cycle weighting factors. These 
weighting factors are different for each of the three vocational 
chassis speed categories for Phase 2. For tractors, only neutral idle 
and hotel idle will be addressed in GEM.
(2) Experimental Validation of GEM
    The core simulation algorithms in GEM have not changed 
significantly since the proposal. Most of the changes since proposal 
focused on streamlining how manufacturers input data into GEM; revising 
to the drive cycles in GEM; and updating how GEM weights these 
different drive cycles to determine a composite fuel consumption value. 
These changes did not alter the fundamental way that GEM simulates 
varying vehicle ``road load'' and how GEM converts vehicle speed to 
engine speed and then interpolates engine maps to determine vehicle 
fuel consumption and CO2 emissions.
    Refinements to GEM since the time of proposal that did alter GEM's 
simulation performance include modifying the default transmissions' 
shift strategies and their power losses. Another key refinement was 
cycle average mapping engines for simulation of the ARB Transient 
cycle. Each time the agencies made such modifications to GEM, GEM's 
correlation to the agencies collection of laboratory-generated engine 
and vehicle data was checked. Potential refinements to GEM were 
accepted if GEM's correlation was improved versus this set of 
experimental data. If potential refinements resulted in GEM's 
correlation to the experimental data

[[Page 73547]]

becoming worse, those potential changes were rejected. Chapter 4.3.2 of 
the RIA details the GEM validation that was performed to determine if 
potential changes to GEM should be accepted or rejected. The first step 
of the validation process involves simulating vehicles in GEM using 
engine fuel maps and transmission shifting strategies obtained from 
manufacturers and comparing GEM results to experiments conducted with 
the same engines and transmissions. This first step re-validates all of 
the non-powertrain elements of GEM, which were already validated in 
Phase 1. The second step is to use GEM's default transmissions' shift 
strategies in simulation \171\ and then compare GEM results to 
powertrain tests of several transmissions. The only difference between 
the first and second step is the shifting strategy and powertrain 
energy loss assumptions. This step facilitates tuning of GEM's default 
transmission models so that they correlate well to a variety of real 
transmissions. The third step is to compare GEM simulations to real-
world in-use recorded data from actual vehicles. This is the most 
challenging step because the experimental data includes real-world 
effects of wind, road grade, and driver behavior in traffic. The most 
important element of this third step is not absolute correlation, but 
rather, relative correlation, which demonstrates that when a technology 
is added to a real vehicle, the relative improvement in the real world 
is simulated in GEM with a high degree of correlation.
---------------------------------------------------------------------------

    \171\ K. Newman, J. Kargul, and D. Barba, ``Development and 
Testing of an Automatic Transmission Shift Schedule Algorithm for 
Vehicle Simulation, ``SAE Int. J. Engines 8(3):2015, doi:10.4271/
2015-01-1142.
---------------------------------------------------------------------------

    In the first validation step, the agencies compared GEM to over 130 
vehicle variants, consistent with the recommendation made by the NAS in 
their Phase 2-First Report.\172\ As described in Chapter 4 of the RIA, 
good agreement was observed between GEM simulations and test data over 
a wide range of vehicles. In general, the model simulations agreed with 
experimental test results within 5 percent on an absolute 
basis. As pointed out in Chapter 4.3.2 of the RIA, relative accuracy is 
more relevant to the intent of this rulemaking, which is to accelerate 
the adoption of additional fuel efficiency improving technologies. 
Consistent with the intent of this rulemaking, all of the numeric 
standards for tractors, trailers and vocational chassis are derived 
from running GEM first with Phase 1 ``baseline'' technology packages 
and then with various Phase 2 technology packages. The differences 
between these GEM results are examined to determine final stringencies. 
In other words, the agencies used the same final version of GEM to 
establish the numeric standards as will be used by manufacturers to 
demonstrate compliance. Therefore, it is most important that GEM 
accurately reflects relative changes in emissions for each added 
technology. In other words, for vehicle certification purposes it is 
less important that GEM's absolute value of the fuel consumption or 
CO2 emissions be accurate compared to laboratory testing of 
the same vehicle. The ultimate purpose of GEM is to evaluate changes or 
additions in technology, and compliance is demonstrated on a relative 
basis to the numeric standards that were also derived from GEM. 
Nevertheless, the agencies concluded that the absolute accuracy of GEM 
is generally within 5 percent, as shown in Figure II.2 2. 
Chapter 4.3.2 of the RIA shows that relative accuracy is even better, 
2-3 percent.
---------------------------------------------------------------------------

    \172\ National Academy of Science. ``Reducing the Fuel 
Consumption and GHG Emissions of Medium- and Heavy-Duty Vehicles, 
Phase Two, First Report.'' 2014. Recommendation1.2.
[GRAPHIC] [TIFF OMITTED] TR25OC16.002


[[Page 73548]]


    In addition to this successful validation against experimental 
results, the agencies have also conducted a peer review of the GEM 
source code. This peer review has been submitted to Docket number EPA-
HQ-OAR-2014-0827.
    The second validation step was to repeat the first step's GEM 
simulations with the agencies' default transmission shift 
strategies.\171\ It was expected that GEM's absolute accuracy would 
decrease because these shift strategies were tuned for best average 
performance and for a particular transmission. Nevertheless, it was 
shown that relative accuracy did not suffer; therefore, the agencies 
deemed the GEM default shift strategies acceptable for GEM 
certification purposes. Further details of this validation step are 
presented in Chapter 4.3.2.3 of the RIA and in a SwRI final 
report.\162\
    As explained above and in Chapter 4.3.2.3 of the RIA, it is 
challenging to achieve absolute correlation between any computer 
simulation and real-world vehicle operation. Therefore, the agencies 
focused on relative comparisons. Following the SAE standard procedure 
SAE J1321 ``Type II,'' two trucks have been tested and these real-world 
results were compared to GEM simulations. In summary, the relative 
comparisons between GEM simulations and the real-world testing of 
trucks showed a 2.4 percent difference. The details of this testing and 
correlation analysis is presented in Chapter 4.3.2.3 of the RIA.
    In conclusion, the agencies completed a number of validation steps 
to ensure that GEM demonstrates a reasonable degree of absolute 
accuracy, but more importantly a high degree of relative accuracy, 
versus both laboratory and real-world experimental data.
(3) Supplements to GEM Simulation
    As in Phase 1, for most tractors and vocational vehicles, 
compliance with the Phase 2 g/ton-mile vehicle standards could be 
evaluated by directly comparing the GEM result to the standard. 
However, in Phase 1, manufacturers incorporating innovative or advanced 
technologies could apply improvement factors to lower the GEM result 
before comparing to the standard.\173\ For example, a manufacturer 
incorporating a launch-assist mild hybrid that was pre-approved for a 5 
percent benefit would apply a 0.95 improvement factor to its GEM 
results for such vehicles. In this example, a GEM result of 300 g/ton-
mile will be reduced to 285 g/ton-mile.
---------------------------------------------------------------------------

    \173\ 40 CFR 1036.610, 1036.615, 1037.610, and 1037.615.
---------------------------------------------------------------------------

    For Phase 2, the agencies largely continue the existing Phase 1 
innovative technology approach, but we name it ``off-cycle'' to better 
reflect its purpose.
(a) Off-Cycle Technology Procedures
    In Phase 1 the agencies adopted an emissions credit generating 
opportunity that applied to new and innovative technologies that reduce 
fuel consumption and CO2 emissions, which were not in common 
use with heavy-duty vehicles before model year 2010 and are not 
reflected over the test procedures or GEM (i.e., the benefits are 
``off-cycle''). See 76 FR 57253. As was the case in the development of 
Phase 1, the agencies continue this approach for technologies and 
concepts with CO2 emissions and fuel consumption reduction 
potential that might not be adequately captured over the Phase 2 duty 
cycles or are not inputs to GEM. Note, however, that the agencies now 
refer to these technologies as off-cycle rather than innovative. 
Comments were generally supportive of continuing this provision. See 
Section I.C(1)(c) of this document and Section 1 of the RTC for more 
discussion of innovative and off-cycle technologies.
    We recognize that the Phase 1 testing burden associated with the 
innovative technology credit provisions discouraged some manufacturers 
from applying. To streamline recognition of many technologies, default 
values have been integrated directly into GEM. For example, automatic 
tire inflation systems have fixed default values, and such technologies 
are now recognized through a post-simulation adjustment approach, 
discussed in Chapter 4 of the RIA. This is similar to the technology 
``pick list'' from our light-duty programs. See 77 FR 62833-62835 
(October 15, 2012). If manufacturers wish to receive additional credit 
beyond these fixed values, then the off-cycle technology credit 
provisions provide a regulatory path toward that additional 
recognition.
    Beyond the additional technologies that the agencies have added to 
GEM, the agencies also believe there are several emerging technologies 
that are being developed today, but will not be accounted for in GEM 
because we do not have enough information about these technologies to 
assign fixed values to them in GEM. Any credits for these technologies 
will need to be based on the off-cycle technology credit generation 
provisions. These require the assessment of real-world fuel consumption 
and GHG reductions that can be measured with verifiable test methods 
using representative operating conditions typical of the engine or 
vehicle application.
    As in Phase 1, the agencies continue to provide two paths for 
approval of the test procedure to measure the CO2 emissions 
and fuel consumption reductions of an off-cycle technology used in the 
HD tractor. See 40 CFR 1037.610 and 49 CFR 535.7. The first path does 
not require a public approval process of the test method. A 
manufacturer can use ``pre-approved'' test methods for HD vehicles 
including the A-to-B chassis testing, powertrain testing or on-road 
testing. A manufacturer may also use any developed test procedure which 
has known quantifiable benefits. A test plan detailing the testing 
methodology is required to be approved by the agencies prior to 
collecting any test data. The agencies will also continue the second 
path which includes a public approval process of any testing method 
which could have uncertain benefits (i.e., an unknown usage rate for a 
technology). Furthermore, the agencies are modifying our provisions to 
better clarify the documentation required to be submitted for approval 
aligning them with provisions in 40 CFR 86.1869-12, and NHTSA 
separately prohibits credits from technologies addressed by any of its 
crash avoidance safety rulemakings (i.e., congestion management 
systems).
    Sections III and V separately describe tractor and vocational 
vehicle technologies, respectively, that the agencies anticipate may 
qualify for these off-cycle credit provisions.
(4) Production Vehicle Testing for Comparison to GEM
    As described in Section III.E.(2)(j), The agencies are requiring 
tractor manufacturers to annually chassis test five production vehicles 
over the GEM cycles to verify that relative reductions simulated in GEM 
are being achieved in production. See 40 CFR 1037.665. We do not expect 
absolute correlation between GEM results and chassis testing. GEM makes 
many simplifying assumptions that do not compromise its usefulness for 
certification, but do cause it to produce emission rates different from 
what would be measured during a chassis dynamometer test. Given the 
limits of correlation possible between GEM and chassis testing, we 
would not expect such testing to accurately reflect whether a vehicle 
was compliant with the GEM standards. Therefore, we are not applying 
GHG compliance liability to such testing. Rather, this testing will be 
for data collection and informational purposes only. The agencies will 
continue to evaluate in-use compliance

[[Page 73549]]

by verifying GEM inputs and testing in-use engines. (Note that NTE 
standards for criteria pollutants may apply for some portion of the 
test cycles.)
(5) Use of GEM in Establishing the Phase 2 Numerical Standards
    As in Phase 1, the agencies are setting specific numerical 
standards against which tractors and vocational vehicles will be 
certified using GEM (box trailers will use a GEM-based equation, and 
some trailers and custom chassis vocational vehicles may optionally use 
a non-GEM certification path). Although these standards are 
performance-based standards, which do not specifically require the use 
of any particular technologies,\174\ the agencies established these 
standards by evaluating specific vehicle technology packages using the 
final version of Phase 2 GEM. We note that that this means the final 
numerical standards are not directly comparable to the proposed 
standards, which were based on an intermediate version of GEM, rather 
than on the final version.
---------------------------------------------------------------------------

    \174\ The sole exception being the design-based standards for 
non-aero and partial aero trailers.
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(a) Relation to In-Use Emissions
    The purpose of this rulemaking is to achieve in-use emission and 
fuel consumption reductions by requiring manufacturers to demonstrate 
that they meet the promulgated emission standards. Thus, it is 
important that GEM simulations be reasonably representative of in-use 
operation. Testing that is unrepresentative of actual in-use operation 
does not necessarily tell us anything about whether any emission 
reductions occur. However, we recognize that certain simplifications 
are necessary for practical simulations. In the past, EPA has addressed 
this issue by including in our testing regulations a process by which 
EPA can work with manufacturers to adjust test procedures to make them 
more representative of in-use operation. For engine testing, this 
provision is in 40 CFR 1065.10(c)(1), where EPA requires manufacturers 
to notify us in cases in which they determine that the specified test 
procedures would result in measurements that do not represent in-use 
operation.
    Although we are not adopting an equivalent provision for GEM at 
this time, we expect similar principles to apply. To the extent that 
GEM fails to represent in-use emission, we would expect to work with 
manufacturers to address the issue--under the existing regulations 
where possible, or by promulgating a new rulemaking.
    We recognize that many compromises must be made between the 
practicality of testing/simulation and the matching of in-use 
operation. We have considered many aspects of the test procedures in 
this respect for the engines, vehicles, and emission controls of which 
we are currently aware. We have concluded that the procedures will 
generally result in emission simulations that are sufficiently 
representative of in-use emissions, even though not all in-use 
operation will occur during simulation. Nevertheless, we have 
identified several areas that deserve some additional discussion.
    GEM is structured to simulate a single vehicle weight (curb weight 
plus payload) per regulatory subcategory. However, we know that actual 
in-use weights will rarely be exactly the same as the simulated 
weights. Nevertheless, since the representativeness of the simulated 
weights (or lack thereof) is being fully considered in the setting of 
the standards, there would be no need to modify the procedures to 
account for different curb weights or payloads.
    GEM simulates vehicle emissions over three drive cycles plus two 
idle cycles, and weights the cycle results based on the type of vehicle 
being certified. These cycles and weightings reflect fleet average 
driving patterns and the agencies do not expect them to fully match 
driving patterns for individual vehicles. Thus, we would generally not 
consider GEM's cycles as unrepresentative for vehicles with different 
in-use driving patterns. However, if new information became available 
that demonstrated that GEM's cycles somehow did not reflect fleet 
average driving patterns, the agencies would consider such information 
in the context of the principles of representative testing, described 
above.
    Finally, GEM includes default values for axle and transmission 
efficiency derived from baseline technologies. However, we generally 
expect manufacturers to use more efficient axles and transmissions for 
Phase 2 vehicles. As noted above, based on comments, the agencies are 
allowing manufacturers to optionally input measured efficiencies to 
better represent these more efficient technologies. We would not 
consider GEM unrepresentative if manufacturers chose to use the default 
values rather than measure these efficiencies directly.
(b) Relation to Powertrain Testing
    As already noted, GEM correlates very well with powertrain testing. 
To the extent they differ, it would be expected to be primarily related 
to how transmission performance is modeled in GEM. Although GEM 
includes a sophisticated model of transmissions, it cannot represent a 
transmission better than a powertrain test of the same transmission. 
Thus, the agencies consider powertrain testing to be as good as or 
better than GEM run using engine-only fuel maps; hence the provision in 
the final rules allowing results from powertrain testing to be used as 
a GEM input.
    In some respects, powertrain testing can be considered to be a 
reference method for this rulemaking. Because manufacturers have the 
option to perform powertrain testing instead of engine-only fuel 
mapping, the stringency of the final standards can be traced to 
powertrain testing. In other words, methods that can be shown to be 
equivalent to powertrain testing can be considered to be consistent 
with the testing that was used as the basis of the final Phase 2 
standards.
    In a related context, it may be useful in the future to consider 
equivalency to powertrain testing as an appropriate criterion for 
evaluating changes to GEM to address new technologies. Consider, for 
example, a new technology that is not represented in GEM, but that is 
reflected in powertrain testing. The agencies could determine that it 
would be appropriate to modify GEM to reflect the technology rather 
than to require manufacturers to perform powertrain testing. In such a 
case, the agencies would not consider the modification to GEM to impact 
the effective stringency of the Phase 2 standards because the new 
version of GEM would be equivalent to performing powertrain testing.

D. Engine Test Procedures and Engine Standards

    In addition to the Phase 1 GEM-based vehicle certification of 
tractors and vocational chassis, the agencies also set Phase 1 separate 
CO2 and fuel efficiency standards for the engines installed 
in tractors and vocational chassis. EPA also set Phase 1 separate 
engine standards for capping methane (CH4) and nitrous oxide 
(N2O) emissions (essentially capping emissions at current 
emission levels). Compliance with all of these Phase 1 separate engine 
standards is demonstrated by measuring these emissions during an engine 
dynamometer test procedure. For Phase 1 the agencies use the same test 
procedure specified for EPA's existing heavy-duty engine emissions 
standards (e.g., NOX and PM standards). These Phase 1 engine 
standards are specified in terms of brake-specific (g/bhp-hr) fuel, 
CO2, CH4 and N2O emissions limits. 
Since the test procedure already

[[Page 73550]]

specified how to measure fuel consumption, CO2 and 
CH4, few changes were needed to utilize the test procedure 
for Phase 1, the most notable change being a modification specifying 
how to measure N2O.
    There are some differences in how these non-GHG test procedures are 
applied in Phase 1 and Phase 2. In EPA's non-GHG engine emissions 
standards, heavy-duty engines must meet brake-specific standards for 
emissions of total oxides of nitrogen (NOX), particulate 
mass (PM), non-methane hydrocarbon (NMHC), and carbon monoxide (CO). 
These standards must be met by all engines both over a 13-mode steady-
state duty cycle called the ``Supplemental Emissions Test'' (SET) \175\ 
and over a composite of a cold-start and a hot-start transient duty 
cycle called the ``Federal Test Procedure'' (FTP). In contrast, for 
Phase 1 the agencies require that engines specifically installed in 
tractors meet fuel efficiency and CO2 standards over only 
the SET but not the composite FTP. This requirement was intended to 
reflect that tractor engines typically operate near steady-state 
conditions versus transient conditions. See 76 FR 57159. For Phase 2 
the agencies are finalizing, as proposed, slight changes to the 13-
modes' weighting factors to better reflect in-use engine operation. 
These weighting factors apply only for determining SET fuel consumption 
and CO2 emissions. No changes are being made to the 
weighting factors for EPA's non-GHG emission standards. The agencies 
adopted the converse for engines installed in vocational vehicles. That 
is, these engines must meet fuel efficiency and CO2 
standards over the composite FTP but not the SET. This requirement was 
intended to reflect that vocational vehicle engines typically operate 
under transient conditions versus steady-state conditions (76 FR 
57178). For both tractor and vocational vehicle engines in Phase 1, EPA 
set CH4 and N2O emissions cap standards over the 
composite FTP only and not over the SET duty cycle. See Section II.D. 
for details on this final action's engine test procedures for Phase 2.
---------------------------------------------------------------------------

    \175\ The SET cycle is also referred to as the ``ramped-modal 
cycle'' because, for criteria pollutants, it is performed as a 
continuous cycle with ramped transitions between the individual 
modes of the SET.
---------------------------------------------------------------------------

    In response to the agencies' proposed engine standards, we received 
a number of public comments. The agencies considered those comments, 
and the following list summarizes key changes we've made in response, 
and more detailed descriptions of these changes are presented in 
Chapter 2.7 of the RIA:
     Recalculated the SET baseline using the new Phase 2 SET 
weighting factors.
     Recalculated the FTP baseline, based on MY 2016 FTP 
certification data from Cummins, DTNA, Volvo, Navistar, Hino, Isuzu, 
Ford, GM and FCA. These included HHD, MHD, and LHD engines.
     Projected how manufacturers would modify maximum fuel 
rates as a function of speed to strategically relocate SET mode points 
to achieve lowest SET results.
     Projected a higher market penetration of WHR in 2027, 
versus what we proposed.
     Decreased our projected impact of engine technology dis-
synergies by increasing the magnitude of our so-called ``dis-synergy 
factors;'' accounting for these changes by increasing the research and 
development costs needed for this additional optimization.
    The following section first describes the engine test procedures 
used to certify engines to the Phase 2 separate engine standards. 
Sections that follow describe the Phase 2 CO2, 
N2O and CH4 separate engine standards and their 
feasibility.
(1) Engine Test Procedures
(a) SET Cycle Weighting
    The SET cycle was adopted by EPA in 2000 and modified in 2005 from 
a discrete-mode test to a ramped-modal cycle to broadly cover the most 
significant part of the speed and torque map for heavy-duty engines, 
defined by three non-idle speeds and three relative torques. The low 
speed is called the ``A speed,'' the intermediate speed is called the 
``B speed,'' and the high speed is called the ``C speed.'' As is shown 
in Table II-1, the SET cumulatively weights these three speeds at 23 
percent, 39 percent, and 23 percent.

            Table II-1--SET Modes Weighting Factor in Phase 1
------------------------------------------------------------------------
                                                              Weighting
                       Speed, % Load                          factor in
                                                             Phase 1 (%)
------------------------------------------------------------------------
Idle.......................................................           15
A, 100.....................................................            8
B, 50......................................................           10
B, 75......................................................           10
A, 50......................................................            5
A, 75......................................................            5
A, 25......................................................            5
B, 100.....................................................            9
B, 25......................................................           10
C, 100.....................................................            8
C, 25......................................................            5
C, 75......................................................            5
C, 50......................................................            5
                                                            ------------
  Total....................................................          100
Cumulative A Speed.........................................           23
Cumulative B Speed.........................................           39
Cumulative C Speed.........................................           23
------------------------------------------------------------------------

    The C speed is typically in the range of 1800 rpm for current heavy 
heavy-duty engine designs. However, it is becoming much less common for 
engines to operate at such a high speeds in real-world driving 
conditions, and especially not during cruise vehicle speeds in the 55 
to 65 mph vehicle speed range. This trend has been corroborated by 
engine manufacturers' in-use data that has been submitted to the 
agencies in comments and presented at technical conferences.\176\ Thus, 
although the current SET represents highway operation better than the 
FTP cycle, it could be improved by adjusting its weighting factors to 
better reflect modern trends in in-use engine operation. Furthermore, 
the most recent trends indicate that manufacturers are configuring 
drivetrains to operate engines at speeds down to a range of 1050-1200 
rpm at a vehicle speed of 65 mph.
---------------------------------------------------------------------------

    \176\ ``OEM perspective--Meeting EPA/NHTSA GHG/Efficiency 
Standards'', 7th Integer Emissions Summit USA 2014, Volvo Group 
North America.
---------------------------------------------------------------------------

    To address this trend toward in-use engine down-speeding, the 
agencies are finalizing as proposed refined SET weighting factors for 
the Phase 2 CO2 emission and fuel consumption standards. The 
new SET mode weightings move most of the C weighting to ``A'' speed, as 
shown in Table II-2. To better align with in-use data, these changes 
also include a reduction of the idle speed weighting factor. These new 
mode weightings do not apply to criteria pollutants or to the Phase 1 
CO2 emission and fuel consumption standards.

          Table II-2--New SET Modes Weighting Factor in Phase 2
------------------------------------------------------------------------
                                                              Weighting
                        Speed/% load                          factor in
                                                             Phase 2 (%)
------------------------------------------------------------------------
Idle.......................................................           12
A, 100.....................................................            9
B, 50......................................................           10
B, 75......................................................           10
A, 50......................................................           12
A, 75......................................................           12
A, 25......................................................           12
B, 100.....................................................            9

[[Page 73551]]

 
B, 25......................................................            9
C, 100.....................................................            2
C, 25......................................................            1
C, 75......................................................            1
C, 50......................................................            1
                                                            ------------
  Total....................................................          100
Total A Speed..............................................           45
Total B Speed..............................................           38
Total C Speed..............................................            5
------------------------------------------------------------------------

(b) Engine Test Provisions for SET, FTP, and Engine Mapping for GEM 
Inputs
    Although GEM does not apply directly to engine certification, Phase 
2 will require engine manufacturers to generate and certify full load 
and motoring torque curves and engine fuel rate maps for input into GEM 
for tractor and vocational chassis manufacturers to demonstrate 
compliance to their respective standards. The full load and motoring 
torque curve procedures were previously defined in 40 CFR part 1065, 
and these are already required for non-GHG emissions certification. The 
Phase 2 final default test procedure for generating an engine map for 
GEM's 55 mph and 65 mph drive cycles is the ``steady-state'' mapping 
procedure. However, the agencies are finalizing an option for 
manufacturers to use the ``cycle average'' mapping procedure for GEM's 
55 mph and 65 mph drive cycles. The test procedure for generating an 
engine map for GEM's ARB Transient drive cycle is the ``cycle-average'' 
mapping procedure, and the agencies are not finalizing any other 
mapping options for the ARB Transient drive cycle. Note that if an 
engine manufacturer elects to conduct powertrain testing to generate 
inputs for GEM, then steady-state and cycle-average engine maps would 
not be required for those GEM vehicle configurations to which the 
powertrain test inputs would apply. The steady-state and cycle-average 
test procedures are specified in 40 CFR parts 1036 and 1065. The 
technical and confidential business information motivations for 
finalizing these test procedures are explained in II. B. (2), along 
with a summary of comments we received.
    One important consideration is the need to correct measured fuel 
consumption rates for the carbon and energy content of the test fuel. 
As proposed, we will continue the Phase 1 approach, which is specified 
in 40 CFR 1036.530. We are specifying a similar approach to GEM fuel 
maps in Phase 2.
    As proposed, the agencies are requiring that engine manufacturers 
certify fuel maps for GEM, as part of their certification to the engine 
standards. However, there were a number of manufacturer comments 
strongly questioning the particular proposed requirement that engine 
manufacturers provide these maps to vehicle manufacturers starting in 
MY 2020 for the certification of vehicles commercially marketed as MY 
2021 vehicles in calendar year 2020. This is a normal engine and 
vehicle manufacturing process, where many vehicles may be produced with 
engines having an earlier model year than the commercial model year of 
the vehicle. For example, we expect that some MY 2021 vehicles will be 
produced with MY 2020 engines. Thus, we proposed to require engine 
manufacturers to begin providing GEM fuel maps for MY 2020 engines so 
that vehicle manufacturers could run GEM to certify MY 2021 vehicles 
with MY 2020 engines. EMA and some of its members commented that MY 
2020 engines should not be subject to Phase 2 requirements, based on 
NHTSA's statutory 4-year lead-time requirement and because the 
potential higher fuel consumption of MY 2020 (i.e., Phase 1) engine 
maps could force vehicle manufacturers to install additional 
technologies that were not projected by the agencies for compliance. 
The agencies considered these comments along with the potential cost 
savings for manufacturers to align the timing of both their engines' 
and vehicle's Phase 2 product plans and certification paths. The 
agencies also considered how this situation would repeat in MY 2024 and 
MY 2027 and possibly with future standards as well. Based on these 
considerations, we have decided that it would be more appropriate to 
harmonize the engine and vehicle standards, starting in MY 2021 so that 
vehicle manufacturers will not need fuel maps for 2020 engines. Thus, 
we are not finalizing the requirement to provide fuel maps for MY 2020 
engines. However, we are requiring fuel maps for all MY 2021 engines, 
even those (e.g., small businesses) for which the Phase 2 engine and 
vehicle standards have been delayed. See 40 CFR 1036.150.
    The current engine test procedures also require the development of 
regeneration emission rate and frequency factors to determine 
infrequent regeneration adjustment factors (IRAFs) that account for the 
emission changes for criteria pollutants during an exhaust emissions 
control system regeneration event. In Phase 1 the agencies adopted 
provisions to exclude CO2 emissions and fuel consumption due 
to regeneration. However, for Phase 2, we are requiring the inclusion 
of CO2 emissions and fuel consumption due to regeneration 
over the FTP and SET (RMC) cycles, as determined using the IRAF 
provisions in 40 CFR 1065.680. While some commenters opposed this 
because of its potential impact on stringency, we do not believe this 
will significantly impact the stringency of these standards because 
manufacturers have already made great progress in reducing the 
frequency and impact of regeneration emissions since 2007. Rather, the 
agencies are including IRAF CO2 emissions for Phase 2 to 
prevent these emissions from increasing in the future to the point 
where they would otherwise become significant. Manufacturers 
qualitatively acknowledged the likely already small and decreasing 
magnitude of IRAF CO2 emissions in their comments. For 
example, EMA stated, ``the rates of infrequent regenerations have been 
going down since the adoption of the Phase 1 standards'' and that IRAF 
``contributions are minor.'' Nevertheless, we believe it is prudent to 
begin accounting for regeneration emissions to discourage manufacturers 
from adopting criteria emissions compliance strategies that could 
reverse this trend. Manufacturers expressed concern about the 
additional test burden, but the only additional requirement would be to 
measure and report CO2 emissions for the same tests they are 
already performing to determine IRAFs for other pollutants.
    At the time of the proposal, we did not specifically adjust 
baseline levels to include additional IRAF emissions because we 
believed them to be negligible and decreasing. Commenters opposing this 
proposed provision provided no data to dispute this belief. We continue 
to believe that regeneration strategies can be engineered to maintain 
these negligible rates. Thus, we do not believe they are of fundamental 
significance for our baselines in the FRM. Highway operation includes 
enough high temperature operation to make active regenerations 
unnecessary. Furthermore, recent improvements in exhaust after-
treatment catalyst formulations and exhaust temperature thermal 
management strategies, such as intake air throttling, minimize 
CO2 IRAF impacts during non-highway operation, where active 
regeneration might be required. Finally, as is discussed in Section 
II.D.(2), recent significant

[[Page 73552]]

efficiency improvements over the FTP cycle suggest that FTP emissions 
may actually be even lower than we have estimated in our updated FTP 
baselines, which would provide additional margin for manufacturers to 
manage any minor CO2 IRAF impacts that may occur.
    We are not including fuel consumption due to after-treatment 
regeneration in the creation of fuel maps used in GEM for vehicle 
compliance. We believe that the IRAF requirements for the separate SET 
and FTP engine standards, along with market forces that already exist 
to minimize regeneration events, will create sufficient incentives to 
reduce fuel consumption during regeneration over the entire fuel map.
(c) Powertrain Testing
    The agencies are finalizing a powertrain test option to afford a 
robust mechanism to quantify the benefits of CO2 reducing 
technologies that are a part of the powertrain (conventional or 
hybrid), that are not captured in the GEM simulation. Among these 
technologies are integrated engine and transmission control and hybrid 
systems. We are finalizing a number of improvements to the test 
procedure in 40 CFR 1037.550. As proposed we are finalizing the 
requirement for Phase 2 hybrid powertrains to mapped using this 
powertrain test method. The agencies are also finalizing modifications 
to 40 CFR 1037.550 to separate out the hybrid specific testing 
protocols.
    To limit the amount of testing under this rule, powertrains can be 
divided into families and are tested in a limited number of simulated 
vehicles that will cover the range of vehicles in which the powertrain 
will be used. A matrix of 8 to 9 tests will be needed per vehicle 
cycle, to enable the use of the powertrain results broadly across all 
the vehicles in which the powertrain will be installed. The individual 
tests differ by the vehicle that is being simulated during the test. 
These are discussed in detail in Chapter 3.6 of the RIA.
(i) Powertrain Test Procedure
    The agencies are expanding upon the test procedures defined 40 CFR 
1037.550 for Phase 1 hybrid vehicles. The Phase 2 expansion will 
migrate the current Phase 1 test procedure to a new 40 CFR 1037.555 and 
will modify the current test procedure in 40 CFR 1037.550, allowing its 
use for Phase 2 only. The Phase 2 modifications relative to 40 CFR 
1037.550 include the addition of the rotating inertia of the driveline 
and tires, and the axle efficiency. This revised procedure also 
requires that each of the powertrain components be cooled so that the 
temperature of each of the components is kept in the normal operation 
range. We are extending the powertrain procedure to PHEV powertrains.
    Powertrain testing contains many of the same requirements as engine 
dynamometer testing. The main differences are where the test article 
connects to the dynamometer and the software that is used to command 
the dynamometer and operator demand setpoints. The powertrain procedure 
finalized in Phase 2 allows for the dynamometer(s) to be connected to 
the powertrain either upstream of the drive axle or at the wheel hubs. 
The output of the transmission is upstream of the drive axle for 
conventional powertrains. In addition to the transmission, a hydraulic 
pump or an electric motor in the case of a series hybrid may be located 
upstream of the drive axle for hybrid powertrains. If optional testing 
with the wheel hub is used, two dynamometers will be needed, one at 
each hub. Beyond these points, the only other difference between 
powertrain testing and engine testing is that for powertrains, the 
dynamometer and throttle setpoints are not set by fixed speed and 
torque targets prescribed by the cycle, but are calculated in real time 
by the vehicle model. The powertrain test procedure requires a forward 
calculating vehicle model, thus the output of the model is the 
dynamometer speed setpoints. The vehicle model calculates the speed 
target using the measured torque at the previous time step, the 
simulated brake force from the driver model, and the vehicle parameters 
(tire rolling resistance, drag area, vehicle mass, rotating mass, and 
axle efficiency). The operator demand that is used to change the torque 
from the engine is controlled such that the powertrain follows the 
vehicle speed target for the cycle instead of being controlled to match 
the torque or speed setpoints of the cycle. The emission measurement 
procedures and calculations are identical to engine testing.
(ii) Engine Test Procedures for Replicating Powertrain Tests
    As described in Section II.B.(2)(b), the agencies are finalizing 
the proposed powertrain test option to quantify the benefits of 
CO2-reducing powertrain technologies. This option is very 
similar to the cycle average mapping approach, although these 
powertrain test results would be used to override both the engine and 
transmission (and possibly axle) simulation portions of GEM, not just 
the engine fuel map. The agencies are requiring that any manufacturer 
choosing to use this option also measure engine speed and engine torque 
during the powertrain test so that the engine's performance during the 
powertrain test could be replicated in a non-powertrain engine test 
cell. Manufacturers would be required to measure or calculate, using 
good engineering judgment, the engine shaft output torque, which would 
be close-coupled to the transmission input shaft during a powertrain 
test. Subsequent engine testing then could be conducted using the 
normal part 1065 engine test procedures as specified in 40 CFR 
1037.551, and g/bhp-hr CO2 results could be compared to the 
levels the manufacturer reported during certification. Such testing 
could apply for both confirmatory and selective enforcement audit (SEA) 
testing. This would simplify both the certification and SEA testing.
    As proposed, engine manufacturers certifying powertrain performance 
(instead of or in addition to the multi-point fuel maps) will be held 
responsible for powertrain test results. If the engine manufacturer 
does not certify powertrain performance and instead certifies only the 
steady-state and/or cycle-average fuel maps, it will held responsible 
for fuel map performance rather than the powertrain test results. 
Engine manufacturers certifying both will be responsible for both.
    Some commenters objected to the potential liability for such 
engine-only tests. However, it appears they do not understand our 
intent. This provision states clearly that this approach could be used 
only where ``the test engine's operation represents the engine 
operation observed in the powertrain test.'' Also, since the 
manufacturers perform all SEA testing themselves, this would be an 
option for the manufacturer rather than something imposed by EPA. Thus, 
this concern should be limited to the narrow circumstance in which EPA 
performs confirmatory engine testing of an engine that was certified 
using powertrain testing, follows the manufacturer's specified engine 
test cycle, and ensures that the test accurately represents the 
engine's performance during the powertrain test. However, it is not 
clear why this would be problematic. It is entirely reasonable to 
assume that testing the engine in this way would result in equivalent 
emission results. To the extent manufacturer concerns remain, each 
manufacturer would be free to certify their engines based on engine-
only fuel maps rather than powertrain testing.
(d) CO2 From Urea SCR Systems
    For diesel engines utilizing urea SCR emission control systems for 
NOX

[[Page 73553]]

reduction, the agencies will allow, but not require, correction of the 
final engine (and powertrain) fuel maps to account for the contribution 
of CO2 from the urea injected into the exhaust. This urea 
typically contributes 0.2 to 0.5 percent of the total CO2 
emissions measured from the engine, and up to 1 percent at certain map 
points. Since current urea production methods use gaseous 
CO2 captured from the atmosphere (along with 
NH3), CO2 emissions from urea consumption does 
not represent a net carbon emission. This adjustment is necessary so 
that fuel maps developed from CO2 measurements will be 
consistent with fuel maps from direct measurements of fuel flow rates. 
This adjustment is also necessary to fully align EPA's CO2 
standards with NHTSA's fuel consumption standards. Failing to account 
for urea CO2 tailpipe emissions would result in reporting 
higher fuel consumption than what was actually consumed. Thus, we are 
only allowing this correction for emission tests where CO2 
emissions are determined from direct measurement of CO2 and 
not from fuel flow measurement, which would not be impacted by 
CO2 from urea.
    We note that this correction will be voluntary for manufacturers, 
and we expect that some manufacturers may determine that the correction 
is too small to be of concern. The agencies will use this correction 
for CO2 measurements with any engines for which the engine 
manufacturer applied the correction for its fuel maps during 
certification.
    We are not allowing this correction for engine test results with 
respect to the engine CO2 standards. Both the Phase 1 
standards and the new standards for CO2 from diesel engines 
are based on test results that included CO2 from urea. In 
other words, these standards are consistent with using a test procedure 
that does not correct for CO2 from urea.
(2) Engine Standards for CO2 and Fuel Consumption
    We are largely maintaining the existing Phase 1 regulatory 
structure for engine standards, which had separate standards for spark-
ignition engines (such as gasoline engines) and compression-ignition 
engines (such as diesel engines), and for HHD, MHD and LHD engines, but 
we are changing how these standards will apply to alternative fuel 
engines as described in Section XII.A.2.
    Phase 1 applied different test cycles depending on whether the 
engine is used for tractors, vocational vehicles, or both, and we are 
continuing this approach. Tractor engines are subject to standards over 
the SET, while vocational engines are subject to standards over the 
FTP. Table II-3 shows the Phase 1 standards for diesel engines.

                                      Table II-3--Phase 1 MY 2017 Diesel Engine CO2 and Fuel Consumption Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                          Units                                 HHD SET            MHD SET            HHD FTP            MHD FTP            LHD FTP
--------------------------------------------------------------------------------------------------------------------------------------------------------
g/bhp-hr.................................................                460                487                555                576                576
gal/100 bhp-hr...........................................             4.5187             4.7839             5.4519             5.6582             5.6582
--------------------------------------------------------------------------------------------------------------------------------------------------------

    In the Phase 2 proposal we assumed that these numeric values of the 
Phase 1 standards were the baselines for Phase 2. We applied our 
technology assessments to these baselines to arrive at the Phase 2 
standards for MY 2021, MY 2024 and MY 2027. In other words, for the 
Phase 2 proposal we projected that starting in MY 2017 engines would, 
on average, just meet the Phase 1 standards and not over-comply. 
However, based on comments we received on how to consistently apply our 
new SET weighting factors in our analysis and based on recent MY 2016 
engine certification data, we are updating our Phase 2 baseline 
assumptions for both the SET and FTP.
    First, with respect to the SET, in the proposal we compared our 
proposed Phase 2 standards, which are based on these new Phase 2 
weighting factors, to the Phase 1 numeric standards, which are based on 
the current Phase 1 weighting factors. Because we continue to use the 
same 13-mode brake specific CO2 and fuel consumption numeric 
values we used for the proposal to represent the performance of a MY 
2017 baseline engine, we are not projecting a different technology 
level in the baseline. Rather, this is simply correcting an ``apples-
to-oranges'' comparison from the proposal by applying the Phase 2 
weighting factors to the MY 2017 baseline engine. This was pointed out 
to us by UCS, ICCT and EDF in their public comments. While this did not 
impact our technology effectiveness or cost analyses, it did impact the 
numeric value of our baseline to which we reference the effectiveness 
of applying technologies to the 13 individual modes of the SET. Because 
the revised SET weighting factors result in somewhat lower brake 
specific CO2 and fuel consumption numeric results for the 
composite baseline SET value, this correction, in turn, lowers the 
numerical values of the final Phase 2 SET standards. Making this 
particular update did not result in a change to the relative stringency 
of the final Phase 2 numeric engine standards (relative to MY 2017 
baseline performance), but our updated feasibility analysis did; see 
Section II.D.(2)(a) below).
    Second, the agencies made adjustments to the FTP baselines, but 
these adjustments were not made because of a calculation error. Rather, 
MY 2016 FTP certification data showed an unexpected step-change 
improvement in engine fuel consumption and CO2 emissions. 
These data were not available at the time of proposal, so the agencies 
relied upon the MY 2017 Phase 1 standard as a baseline. EDF publicly 
commented in response to the NODA that the more recent certification 
data revealed this new step-change. MY 2016 certification data 
submitted to the agencies \177\ as well as to ARB \178\ show that many 
engines from many manufacturers already not only achieve the Phase 1 
FTP standards, but some were also below the MY 2027 standards proposed 
for Phase 2. This was not the case for the SET, where most 
manufacturers are still not yet complying with the MY 2017 Phase 1 SET 
standards. In view of this situation for the FTP, the agencies are 
adjusting the Phase 2 FTP baseline to reflect this shift. The 
underlying reasons for this shift are mostly related to manufacturers 
optimizing their SCR thermal management strategy over the FTP in ways 
that we (mistakenly) thought they already had in MY 2010 (i.e., the 
Phase 1 baseline). As background, the FTP includes a cold-start, a hot-
start and significant time spent at engine idle. During these portions 
of the FTP, the NOX SCR system can cool down and lose 
NOX reducing efficiency. One simplistic strategy to maintain 
SCR temperature is to inefficiently consume additional fuel, such that 
the fuel energy is lost to the

[[Page 73554]]

exhaust system in the form of heat. There are more sophisticated 
strategies to maintain SCR temperature, however, but these apparently 
required additional time from MY 2010 for research, development and 
refinement. In updating these baseline values, the agencies did 
consider the concerns raised by manufacturers about the potential 
impact of IRAFs on baseline emissions.
---------------------------------------------------------------------------

    \177\ https://www3.epa.gov/otaq/certdata.htm#oh.
    \178\ http://www.arb.ca.gov/msprog/onroad/cert/mdehdehdv/2016/2016.php.
---------------------------------------------------------------------------

    As just noted, at the time of Phase 1 we had not realized that 
these improvements were not already in the Phase 1 baseline. These 
include optimizing the use of an intake throttle to decrease excess 
intake air at idle and SCR catalyst reformulation to maintain SCR 
efficiency at lower temperatures. Based on this information, which was 
provided to the agencies by engine manufacturers, but only after we 
specifically requested this information, the agencies concluded that in 
Phase 1 we did not account for how much further these kinds of 
improvements could still impact FTP fuel consumption. Conversely, only 
by reviewing the new MY 2016 certification data did we realize how 
little SCR thermal management optimization actually occurred for the 
engine model years that we used to establish the Phase 1 baseline--
namely MY 2009 and MY 2010 engines. Because we never accounted for this 
kind of improvement in our Phase 2 proposal's stringency analysis for 
meeting the Phase 2 proposed FTP standards, this baseline shift does 
not alter our projected effectiveness and market adoption rates from 
the proposal. Therefore, we continue to apply the same improvements 
that we proposed, but we apply them to the updated FTP baseline. See 
Section II.D.(5) for a discussion on how this impacts carry-over of 
Phase 1 emission credits.
    Table II-4 shows the Phase 2 diesel engine final CO2 
baseline emissions. Note that the gasoline engine CO2 
baseline for Phase 2 is the same as the Phase 1 HD gasoline FTP 
standard, 627 g/bhp-hr. More detailed analyses on these Phase 2 
baseline values of tractor and vocational vehicles can be found in 
Chapter 2.7.4 of RIA.

                                   Table II-4--Phase 2 Diesel Engine Final CO2 and Fuel Consumption Baseline Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
                          Units                                 HHD SET            MHD SET            HHD FTP            MHD FTP            LHD FTP
--------------------------------------------------------------------------------------------------------------------------------------------------------
g/bhp-hr.................................................                455                481                525                558                576
gal/100 bhp-hr...........................................             4.4695             4.7250             5.1572             5.4813             5.6582
--------------------------------------------------------------------------------------------------------------------------------------------------------

    As described below, the agencies are adopting standards for new 
compression-ignition engines for Phase 2, commencing in MY 2021, that 
will require additional reductions in CO2 emissions and fuel 
consumption beyond the Phase 2 baselines. The agencies are not adopting 
new CO2 or fuel consumption engine standards for new heavy-
duty gasoline engines. Note, however, that we are projecting some small 
improvement in gasoline engine performance that will be recognized over 
the vehicle cycles (that is, reflected in the stringency of certain of 
the vocational vehicle standards). See Section V.B.2.a below.
    For diesel engines to be installed in Class 7 and 8 combination 
tractors, the agencies are adopting the SET standards shown in Table 
II-5.\179\ The MY 2027 SET standards for engines installed in tractors 
will require engine manufacturers to achieve, on average, a 5.1 percent 
reduction in fuel consumption and CO2 emissions beyond the 
Phase 2 baselines. We are also adopting SET standards in MY 2021 and MY 
2024 that will require tractor engine manufacturers to achieve, on 
average, 1.8 percent and 4.2 percent reductions in fuel consumption and 
CO2 emissions, respectively, beyond the Phase 2 baselines.
---------------------------------------------------------------------------

    \179\ The agencies note that the CO2 and fuel 
consumption standards for Class 7 and 8 combination tractors do not 
cover gasoline or LHDD engines, as those are not used in Class 7 and 
8 combination tractors.
    \180\ Tractor engine standards apply to all tractor engines, 
without regard to the actual fuel (e.g., diesel or natural gas) or 
engine-cycle classification (e.g., compression-ignition or spark-
ignition).

           Table II-5--Phase 2 Heavy-Duty Tractor Engine Standards for Engines 180 Over the SET Cycle
----------------------------------------------------------------------------------------------------------------
                                                                                   Heavy  heavy-   Medium heavy-
                  Model year                                Standard                   duty            duty
----------------------------------------------------------------------------------------------------------------
2021-2023.....................................  CO2 (g/bhp-hr)..................             447             473
                                                Fuel Consumption (gallon/100 bhp-         4.3910          4.6464
                                                 hr).
2024-2026.....................................  CO2 (g/bhp-hr)..................             436             461
                                                Fuel Consumption (gallon/100 bhp-         4.2829          4.5285
                                                 hr).
2027 and Later................................  CO2 (g/bhp-hr)..................             432             457
                                                Fuel Consumption (gallon/100 bhp-         4.2436          4.4892
                                                 hr).
----------------------------------------------------------------------------------------------------------------

    For diesel engines to be installed in vocational chassis, the 
agencies are adopting the FTP standards shown in Table II-6. The MY 
2027 FTP standards for engines installed in vocational chassis will 
require engine manufacturers to achieve, on average, a 4.2 percent 
reduction in fuel consumption and CO2 emissions beyond the 
Phase 2 baselines. We are also adopting FTP standards in MY 2021 and MY 
2024 that will require vocational chassis engine manufacturers to 
achieve, on average, 2.3 percent and 3.6 percent reductions in fuel 
consumption and CO2 emissions, respectively, beyond the 
Phase 2 baselines.

[[Page 73555]]



                Table II-6--Vocational Diesel (CI) Engine Standards Over the Heavy-Duty FTP Cycle
----------------------------------------------------------------------------------------------------------------
                                                                                  Medium  heavy-   Light  heavy-
              Model year                        Standard           Heavy  heavy-   duty  diesel    duty  diesel
                                                                    duty \181\         \181\           \182\
----------------------------------------------------------------------------------------------------------------
2021-2023.............................  CO2 (g/bhp-hr)..........             513             545             563
                                        Fuel Consumption (gallon/         5.0393          5.3536          5.5305
                                         100 bhp-hr).
2024-2026.............................  CO2 (g/bhp-hr)..........             506             538             555
                                        Fuel Consumption (gallon/         4.9705          5.2849          5.4519
                                         100 bhp-hr).
2027 and Later........................  CO2 (g/bhp-hr)..........             503             535             552
                                        Fuel Consumption (gallon/         4.9411          5.2554          5.4224
                                         100 bhp-hr).
----------------------------------------------------------------------------------------------------------------

(a) Feasibility of the Diesel (Compression-Ignition) Engine Standards
---------------------------------------------------------------------------

    \181\ Heavy heavy-duty engine standards apply to all heavy 
heavy-duty engines, without regard to the actual fuel (e.g., diesel 
or natural gas) or engine-cycle classification (e.g., compression-
ignition or spark-ignition).
    \182\ The agencies are not adopting new CO2 or fuel 
consumption engine standards for new heavy-duty gasoline engines. 
Therefore, the Phase 2 HD gasoline FTP standard is the same as the 
Phase 1 HD gasoline FTP standard, 627 g/bhp-hr, 7.0552 gallon/100 
bhp-hr.
---------------------------------------------------------------------------

    In this section, the agencies discuss our assessment of the 
feasibility of the engine standards and the extent to which they 
conform to our respective statutory authorities and responsibilities. 
More details on the technologies discussed here can be found in RIA 
Chapter 2.3. The feasibility of these standards is further discussed in 
RIA Chapter 2.7 for tractor and vocational vehicle engines. While the 
projected technologies are discussed here separately, as is discussed 
at the beginning of this Section II.D, the agencies also accounted for 
dis-synergies between technologies. Note that Section II.D.(2)(e) 
discusses the potential for some manufacturers to achieve greater 
emission reductions by introducing new engine platforms, and how and 
why these reductions are reflected in the tractor and vocational 
vehicle standards.
    Based on the technology analysis described below, the agencies 
project that a technology path exists that will allow engine 
manufacturers to meet the final Phase 2 standards by 2027, and to meet 
the MY 2021 and 2024 standards. The agencies also project that these 
manufacturers will be able to meet these standards at a reasonable cost 
and without adverse impacts on in-use reliability.
    In general, engine performance for CO2 emissions and 
fuel consumption can be improved by improving the internal combustion 
process and by reducing energy losses. More specifically, the agencies 
have identified the following key means by which fuel efficiency can be 
improved:
     Combustion optimization
     Turbocharger design and optimization
     Engine friction and other parasitic loss reduction
     Exhaust after-treatment pressure drop reduction
     Intake air and exhaust system pressure drop reduction 
(including EGR system)
     Engine down-sizing to improve core engine efficiency
     Engine down-speeding over the SET, and in-use, by lug 
curve shape optimization
     Waste heat recovery system installation and optimization
     Physics model based electronic controls for transient 
performance optimization
    The agencies are gradually phasing in the separate engine standards 
from 2021 through 2027 so that manufacturers can gradually introduce 
these technology improvements. For most of these, the agencies project 
manufacturers could begin applying these technologies to about 45-50 
percent of their heavy-duty engines by 2021, 90-95 percent by 2024, and 
ultimately apply them to 100 percent of their heavy-duty engines by 
2027. However, for some of these improvements (such as waste heat 
recovery and engine downsizing) we project lower application rates in 
the Phase 2 time frame. This phase-in structure is consistent with the 
normal manner in which manufacturers introduce new technology to manage 
limited R&D budgets as well as to allow them to work with fleets to 
fully evaluate in-use reliability before a technology is applied fleet-
wide. The agencies believe the phase-in schedule will allow 
manufacturers to complete these normal processes. See RIA 2.3.9.
    Based on our technology assessment described below, the engine 
standards appear to be consistent with the agencies' respective 
statutory authorities. All of the technologies with high penetration 
rates above 50 percent have already been demonstrated to some extent in 
the field or in research laboratories, although some development work 
remains to be completed. We note that our feasibility analysis for 
these engine standards is not based on projecting 100 percent 
application for any technology until 2027. We believe that projecting 
less than 100 percent application is appropriate and gives us 
additional confidence that the 2021 and 2024 MY standards are feasible.
    Because this analysis considers reductions from engines meeting the 
Phase 1 standards, it assumes manufacturers will continue to include 
the same compliance margins as in Phase 1. In other words, a 
manufacturer currently declaring FCLs 10 g/bhp-hr above its measured 
emission rates (in order to account for production and test-to-test 
variability) will continue to do the same in Phase 2. Both the costs 
and benefits are determined relative to these baselines, and so are 
reflective of these compliance margins.
    The agencies have carefully considered the costs of applying these 
technologies, which are summarized in Section II.D.(2)(d). These costs 
appear to be reasonable on both a per engine basis, and when 
considering payback periods.\183\ The engine technologies are discussed 
in more detail below. Readers are encouraged to see the RIA Chapter 2.7 
for additional details (and underlying references) about our 
feasibility analysis.
---------------------------------------------------------------------------

    \183\ See Section IX.M for additional information about payback 
periods.
---------------------------------------------------------------------------

(i) Combustion Optimization
    Although manufacturers are making significant improvements in 
combustion to meet the Phase 1 engine standards, the agencies project 
that even more improvement is possible after 2018. For example, 
improvements to fuel injection systems will allow more flexible fuel 
injection capability with higher injection pressure, which can provide 
more opportunities to improve engine fuel efficiency. Further 
optimization of piston bowls and injector tips will also improve engine 
performance and fuel efficiency. We project that a reduction of up to 
1.0 percent is feasible in the 2024 model year through the use of

[[Page 73556]]

these technologies, although it will likely apply to only 95 percent of 
engines until 2027.
    Another important area of potential improvement is advanced engine 
control incorporating model based calibration to reduce losses of 
control during transient operation. Improvements in computing power and 
speed will make it possible to use much more sophisticated algorithms 
that are more predictive than today's controls. Because such controls 
are only beneficial during transient operation, they will reduce 
emissions over the FTP cycle, over the ARB Transient cycle's cycle-
average mapping procedure, and during in-use operation, but this 
technology will not reduce emissions over the SET cycle or over the 
steady-state engine mapping procedure. Thus, the agencies are 
projecting model based control reductions only for vocational engines' 
FTP standards and for projecting improvements captured by the cycle-
average mapping over the ARB Transient cycle. Although this control 
concept is not currently available and is still under development, we 
project model based controls achieving a 2 percent improvement in 
transient emissions. Based on model based controls already in 
widespread use in engine laboratories for the calibration of simpler 
controllers and based on recent model based control development under 
the DOE SuperTruck partnership (e.g., DTNA's SuperTruck engine's model 
based controls), we project that such controls could be in limited 
production for some engine models by 2021. We believe that some 
vocational chassis applications would particularly benefit from these 
controls in-use (e.g., urban applications with significant in-use 
transient operation). Therefore, we project that a modest amount of 
engine models will have these controls by MY 2021. We also project that 
manufacturers will learn more from the in-use operation of these 
technology leading engines, and manufacturers will be able to improve 
these controls even further, such that they would additionally benefit 
other vocational applications, such as multi-purpose and regional 
applications. By 2027, we project that 40 percent of all vocational 
diesel engines will incorporate model-based controls at a 2 percent 
level of effectiveness.
(ii) Turbocharging System
    Many advanced turbocharger technologies can be brought into 
production in the time frame between 2021 and 2027, and some of them 
are already in production, such as mechanical or electric turbo-
compounding, more efficient variable geometry turbines, and Detroit 
Diesel's patented asymmetric turbocharger. A turbo-compound system, 
like those installed on some of Volvo's EURO VI compliant diesels and 
on some of DTNA's current U.S. offerings (supplied to DTNA by a 
division of Cummins), extracts energy from the exhaust to provide 
additional power. Mechanical turbo-compounding includes a power turbine 
located downstream of the turbine which in turn is connected to the 
crankshaft to supply additional power. On-highway demonstrations of 
this technology began in the early 1980s. It was used first in heavy 
duty production in the U.S. by Detroit Diesel for their DD15 and DD16 
engines and reportedly provided a 3 to 5 percent fuel consumption 
reduction. Results are duty cycle dependent, and require significant 
time at high load to realize an in-use fuel efficiency improvement. 
Lightly loaded vehicles on flat roads or at low vehicle speeds can 
expect little or no benefit. Volvo reports two to four percent fuel 
consumption improvement in line haul applications.\184\ Because of 
turbo-compound technology's drive cycle dependent effectiveness, the 
agencies are only projecting a market penetration of 10 percent for all 
tractor engines, at slightly less than 2 percent effectiveness over the 
SET. The agencies are considering turbo-compound to be mutually 
exclusive with WHR because both technologies seek to extract additional 
usable work from the same waste heat and are unlikely to be used 
together.
---------------------------------------------------------------------------

    \184\ http://www.volvotrucks.us/powertrain/d13/.
---------------------------------------------------------------------------

(iii) Engine Friction and Parasitic Losses
    The friction associated with each moving part in an engine results 
in a small loss of engine power. For example, frictional losses occur 
at bearings, in the valve train, and at the piston ring-cylinder 
interface. Taken together such losses represent a measurable fraction 
of all energy lost in an engine. For Phase 1, the agencies projected a 
1-2 percent reduction in fuel consumption due to friction reduction. 
However, new information leads us to project that an additional 1.4 
percent reduction is possible for some engines by 2021 and all engines 
by 2027. These reductions are possible due to improvements in bearing 
materials, lubricants, and new accessory designs such as variable-speed 
pumps.
(iv) After-Treatment Optimization
    All heavy duty diesel engine manufacturers are already using diesel 
particulate filters (DPFs) to reduce particulate matter (PM) and 
selective catalytic reduction (SCR) to reduce NOX emissions. 
The agencies see two areas in which improved after-treatment systems 
can also result in lower fuel consumption. First, increased SCR 
efficiency could allow re-optimization of combustion for better fuel 
consumption because the SCR would be capable of reducing higher engine-
out NOX emissions. We don't expect this to be significant, 
however. Manufacturers already optimize the DEF (urea) consumption and 
fuel consumption to achieve the lowest cost of operation; taking into 
account fuel consumption, DEF consumption and the prices of fuel and 
DEF. Therefore, if manufacturers re-optimized significantly for fuel 
consumption, it is possible that this would lead to higher net 
operating costs. This scenario is highly dependent upon fuel and DEF 
prices, so projecting this technology path is uncertain. Second, 
improved designs could reduce backpressure on the engine to lower 
pumping losses. If manufacturers have opportunities to lower 
backpressure within the size constraints of the vehicle, the agencies 
project that manufacturers will opt to lower after-treatment back 
pressure. The agencies project the combined impact of these 
improvements would be 0.6 percent over the SET.
    Note that this improvement is independent of cold-start 
improvements made recently by some manufacturers with respect to 
vocational engines. Thus, the changes being made to the FTP baseline 
engines do not reduce the likelihood of the benefits of re-optimizing 
after-treatment projected here.
(v) Engine Intake and Exhaust Systems
    Various high efficiency air handling for both intake air and 
exhaust systems could be produced in the 2020 and 2024 time frame. To 
maximize the efficiency of such processes, induction systems may be 
improved by manufacturing more efficiently designed flow paths 
(including those associated with air cleaners, chambers, conduit, mass 
air flow sensors and intake manifolds) and by designing such systems 
for improved thermal control. Improved turbocharging and air handling 
systems will likely include higher efficiency EGR systems and 
intercoolers that reduce frictional pressure losses while maximizing 
the ability to thermally control induction air and EGR. EGR systems 
that often rely upon an adverse pressure gradient (exhaust manifold 
pressures greater than intake manifold pressures) must be reconsidered 
and their adverse pressure gradients

[[Page 73557]]

minimized. Other components that offer opportunities for improved flow 
efficiency include cylinder heads, ports and exhaust manifolds to 
further reduce pumping losses by about 1 percent over the SET.
(vi) Engine Downsizing and Down Speeding
    Proper sizing of an engine is an important component of optimizing 
a vehicle for best fuel consumption. This Phase 2 rule will require 
reductions in road load due to aerodynamic resistance, tire rolling 
resistance and weight, which will result in a drop in the vehicle power 
demand for most operation. This drop moves the engine operating points 
down to a lower load zone, which can move the engine away from 
operating near its peak thermal efficiency (a.k.a. the ``sweet spot''). 
Engine downsizing combined with engine down speeding can allow the 
engine to move back to higher loads and a lower speed zone, thus 
achieving better fuel efficiency in the real world. However, because of 
the way engines are tested, little of the benefit of engine downsizing 
would be detected during engine testing (if power density remains the 
same) because the engine test cycles are de-normalized based on the 
full torque curve. Thus, the separate engine standards are not the 
appropriate standards for recognizing the benefits of engine 
downsizing. Nevertheless, we project that some small benefit can be 
measured over the engine test cycles depending on the characteristics 
of the engine fuel map and how the SET points are determined as a 
function of the engine's lug curve.
    After the proposal we received comments recommending that we should 
recognize some level of engine down speeding within the separate engine 
standards. Based on this comment and some additional confidential 
business information that we received, we believe that engine lug curve 
reshaping to optimize the locations of the 13-mode points is a way that 
manufacturers can demonstrate some degree of engine down-speeding over 
the engine test. As pointed out in Chapter 2.3.8 and 2.7.5 of the RIA, 
down speeding via lug curve reshaping alone can provide SET reductions 
in the range of 0.4 percent depending on the engine map 
characteristics.
(vii) Waste Heat Recovery
    More than 40 percent of all energy loss in an engine is lost as 
heat to the exhaust and engine coolant. For many years, manufacturers 
have been using turbochargers to convert some of this waste heat in the 
exhaust into usable mechanical power that is then used to compress the 
intake air. Manufacturers have also been developing a Rankine cycle-
based system to extract additional heat energy from the engine. Such 
systems are often called waste heat recovery (WHR) systems. The 
possible sources of waste heat energy include the exhaust, recirculated 
exhaust gases, compressed charge air, and engine coolant. The basic 
approach with WHR is to use waste heat from one or more of these 
sources to evaporate a working fluid, which is passed through a turbine 
or equivalent expander to create mechanical or electrical power, then 
re-condensed.
    For the proposal, the agencies projected that by 2027, 15 percent 
of tractor engines would employ WHR systems with an effectiveness of 
better than three percent. We received many comments on this 
projection, which are discussed briefly below and in more detail in the 
RTC. In particular, we note that some of the comments included 
confidential data related to systems not yet on the market. After 
carefully considering all of these comments, we have revised our 
projections to increase the effectiveness, decrease costs, and project 
higher adoption rates than we proposed.
    Prior to the Phase 1 Final Rule, the NAS estimated the potential 
for WHR to reduce fuel consumption by up to 10 percent.\185\ However, 
the agencies do not believe such levels will be achievable within the 
Phase 2 time frame. There currently are no commercially available WHR 
systems for diesel engines, although research prototype systems are 
being tested by some manufacturers. American Trucking Association, 
Navistar, DTNA, OOIDA, Volvo, and UPS commented that because WHR is 
still in the prototype stage, it should not be assumed for setting the 
stringency of the tractor engine standards. Many of these commenters 
pointed to the additional design and development efforts that will be 
needed to reduce cost, improve packaging, reduce weight, develop 
controls, select an appropriate working fluid, implement expected OBD 
diagnostics, and achieve the necessary reliability and durability. Some 
stated that the technology has not been thoroughly tested or asked that 
more real-world data be collected before setting standards based on 
WHR. Some of these commenters provided confidential business 
information pertaining to their analysis of WHR system component costs, 
failure modes, and projected warranty cost information.
---------------------------------------------------------------------------

    \185\ See 2010 NAS Report, page 57.
---------------------------------------------------------------------------

    Alternatively, a number of commenters including Cummins, ICCT, 
CARB, ACEEE, EDF, Honeywell, ARB and others stated that the agencies 
should increase the assumed application rate of WHR in the final rule 
and the overall stringency of the engine standards. They argued the 
agencies' WHR technology assessment was outdated and too conservative, 
the fuel savings and GHG reduction estimation for WHR were too low, and 
the agencies' cost estimates were based on older WHR systems where 
costs were confounded with hybrid component costs and that these have 
since been improved upon. In addition, the agencies received CBI 
information supporting the arguments of some of these commenters.
    Cummins stated the agencies underestimated the commercial viability 
of WHR and that we overstated the development challenges and timing in 
the NPRM. They said WHR can provide a 4 to 5 percent improvement in 
fuel consumption on tractor drive cycles and that WHR would be 
commercially viable and available in production as early as 2020 and 
will exceed the agencies' estimates for market penetration over the 
period of the rule. According to Cummins, the reliability of their WHR 
system has improved with each generation of the technology and they 
have developed a smaller system footprint, improved integration with 
the engine and vehicle and a low-GWP working fluid, resulting in a much 
more compact and integrated system. They added that their system would 
be evaluated in extended customer testing by the end of 2015, and that 
results of that experience will inform further technology development 
and product engineering leading to expected commercial product 
availability in the 2020 timeframe. Furthermore, they said multiple 
product development cycles over the implementation timeframe of the 
rule would provide opportunities for further development for reduced 
cost and improved performance and reliability.
    Some commenters, including EDF, said the agencies' assumed design 
had little in common with the latest designs planned for production. 
They cited several publications, including the NAS 21st Century Truck 
Program report #3 and stated WHR effectiveness is much higher than the 
agencies estimated. Gentham cited an ICCT study saying that up to a 12 
percent fuel consumption reduction from a 2010 baseline engine is 
possible with the application of advanced engine technologies and WHR.

[[Page 73558]]

    The agencies recognize that much work remains to be done, but we 
are providing significant lead time to bring WHR to market. Based on 
our assessment of each manufacturer's work to date, we are confident 
that a commercially-viable WHR capable of reducing fuel consumption by 
over three percent will be available in the 2021 to 2024 time frame. 
Concerns about the system's cost and complexity may remain high enough 
to limit the use of such systems in this time frame. Moreover, 
packaging constraints and lower effectiveness under transient 
conditions will likely limit the application of WHR systems to line-
haul tractors. Refer to RIA Chapter 2.3.9 for a detailed description of 
these systems and their applicability. For our analysis of the engine 
standards, the agencies project that WHR with the Rankine technology 
could be used on 1 percent of tractor engines by 2021, on 5 percent by 
2024, and 25 percent by 2027, with nearly all being used on sleeper 
cabs. We project this sharper increase in market adoption in the 2027 
timeframe because we have noted that most technology adoption rate 
curves follow an S-shape: Slow initial adoption, then more rapid 
adoption, and then a leveling off as the market saturates (not always 
at 100 percent).\186\ We assumed an S-shape curve for WHR adoption, 
where we project a steeper rise in market adoption in and around the 
2027 timeframe. Given our averaging, banking and trading program 
flexibilities and that manufacturers may choose from a range of other 
technologies, we believe that manufacturers will be able to meet the 
2027 standards, which we based on a 25 percent WHR adoption in tractor 
engines. Although we project these as steps, it is more likely that 
manufacturers will try to gradually increase the WHR adoption in MY 
2025 and MY 2026 from the 5 percent in 2024 to generate emission 
credits to smooth the transition to the 2027 standards.
---------------------------------------------------------------------------

    \186\ NACFE 2015 Annual Fleet Fuel Study.
---------------------------------------------------------------------------

    Commenters opposing the agencies' WHR projections argued that the 
real-world GHG and fuel consumption savings will be less than in 
prototype systems. DTNA said a heat rejection increase of 30 percent to 
40 percent with WHR systems will require larger radiators, resulting in 
more aerodynamic drag and lower fuel savings from WHR systems. DTNA 
cited a Volvo study showing a 2 percent loss of efficiency with the 
larger frontal areas needed to accommodate heat rejection from WHR 
systems. Daimler stated effectiveness may be lower than expected since 
there is large drop off in fuel savings when the tractor is not 
operating on a steady state cycle and the real world performance of WHR 
systems will be hurt by transient response issues. Daimler and ACEEE 
said the energy available from exhaust and other waste heat sources 
could diminish as tractor aerodynamics improve, thus lowering the 
expected fuel savings from WHR. Daimler said because of this, WHR 
estimated fuel savings was overestimated by the agencies. Navistar said 
WHR working fluids will have a significant GHG impact based on their 
high global warming potential. They commented that fuel and GHG 
reductions will be lower in the real world with the re-weighting of the 
RMC which results in lower engine load, and thus lower available waste 
heat. However, none of these commenters have access to the full range 
of data available to the agencies, which includes CBI.
    It is important to note that the net cost and effectiveness of 
future WHR systems depends on the sources of waste heat. Systems that 
extract heat from EGR gases may provide the side benefit of reducing 
the size of EGR coolers or eliminating them altogether. To the extent 
that WHR systems use exhaust heat, they increase the overall cooling 
system heat rejection requirement and likely require larger radiators. 
This could have negative impacts on cooling fan power needs and vehicle 
aerodynamics. Limited engine compartment space under the hood could 
leave insufficient room for additional radiator size increasing. Many 
of these issues disappear if exhaust waste heat is not recovered from 
the tailpipe and brought under the hood for conversion to mechanical 
work. In fact, it is projected that if a WHR system only utilizes heat 
that was originally within the engine compartment (e.g., EGR cooler 
heat, coolant heat, oil heat, etc.), then any conversion of that heat 
to mechanical heat actually reduces the heat rejection demand under the 
hood; potentially leading to smaller radiators and lower frontal area, 
which would actually lead toward improved aerodynamic performance. 
Refer to RIA Chapter 2.3.9 for more discussion.
    Several commenters stated that costs are highly uncertain for WHR 
technology, but argued that the agencies' assumption of a $10,523 cost 
in 2027 are likely significantly lower than reality. Volvo estimated a 
cost of $21,700 for WHR systems. Volvo said that in addition to 
hardware cost being underestimated, the agencies had not properly 
accounted for other costs such as the R&D needed to bring the 
technology into production within a vehicle. Volvo said they would lose 
$17,920 per unit R&D alone, excluding other costs such as materials and 
administrative expenses. Daimler said that costs almost always inflate 
as the complexity of real world requirements drive up need for more 
robust designs, sensors, controls, control hardware, and complete 
vehicle integration. They added that development costs will be large 
and must be amortized over limited volumes. Furthermore, OOIDA said the 
industry experience with such complex systems is that maintenance, 
repair, and down-time cost can be much greater than the initial 
purchase cost. ATA and OOIDA said that potential downtime associated 
with an unproven technology is a significant concern for the industry.
    On the other hand, some commenters argued that the agencies had 
actually overestimated WHR costs in the proposal. These commenters 
generally argued that engineering improvements to the WHR systems that 
will go into production in the Phase 2 time frame would lower costs, in 
particular by reducing components. The agencies largely agree with 
these commenters and we have revised our analysis to reflect these cost 
savings. See RIA 2.11.2.15 for additional discussion.
(viii) Technology Packages for Diesel Engines Installed in Tractors
    This Section (a)(viii) describes technology packages that the 
agencies project could be applied to Phase 1 tractor engines to meet 
the Phase 2 SET separate engine standards. Section II.D.(2)(e) also 
describes additional improvements that the agencies project some engine 
manufacturers will be able to apply to their engines.
    We received comments on the tractor engine standards in response to 
the proposal and in response to the NODA. These comments can be grouped 
into two general themes. One theme expressed by ARB, non-governmental 
environmentally focused organizations, Cummins and some technology 
suppliers like Honeywell, recommended higher engine stringencies, up to 
10-15 percent in some comments. Another theme, generally expressed by 
vertically integrated engine and vehicle manufacturers supported either 
no Phase 2 engine standards at all, or they supported the proposal's 
standards, but none of these commenters supported standards that were 
more stringent than what we proposed. An example of the contrast 
between these two themes can be shown in one report submitted to the 
docket and another submission rebutting the statements made in the

[[Page 73559]]

report. The report was submitted to the agencies by the Environmental 
Defense Fund (EDF).\187\ On the other hand, four vertically integrated 
engine and vehicle manufacturers, DTNA, Navistar, Paccar, and Volvo, 
submitted a rebuttal to EDF's findings.\188\ Some of these individual 
vehicle manufacturers also provided their own comments on EDF's 
report.189 190 Cummins also provided comments and 
recommended stringencies somewhere between EDF's recommendations and 
the integrated manufacturers' rebuttal. Cummins recommended achieving 
reductions by 2030 in the range of 9-15 percent. CARB's recommendation 
from their comments \191\ is 7.1 percent in 2024.
---------------------------------------------------------------------------

    \187\ Environmental Defense Fund, Greenhouse Gas Emission and 
Fuel Efficiency Standards for Medium-Duty and Heavy-Duty Engines and 
Vehicles--Phase 2--Notice of Data Availability,'' Docket: ID No. 
EPA-HQ-OAR-2014-0817, October 1, 2015.
    \188\ Daimler Trucks North America, Navistar, Inc, Paccar Inc, 
and Volvo Group,'' Greenhouse Gas Emission and Fuel Efficiency 
Standards for Medium-Duty and Heavy-Duty Engines and Vehicles--Phase 
2--Notice of Data Availability,'' Docket: ID No. EPA-HQ-OAR-2014-
0817, April 1, 2016.
    \189\ Navistar, Inc., Greenhouse Gas Emission and Fuel 
Efficiency Standards for Medium-Duty and Heavy-Duty Engines and 
Vehicles--Phase 2--Notice of Data Availability,'' Docket: ID No. 
EPA-HQ-OAR-2014-0817, April 1, 2016.
    \190\ Daimler Trucks North America LLC, Detroit Diesel 
Corporation, Greenhouse Gas Emission and Fuel Efficiency Standards 
for Medium-Duty and Heavy-Duty Engines and Vehicles--Phase 2--Notice 
of Data Availability,'' Docket: ID No. EPA-HQ-OAR-2014-0817, April 
1, 2016.
    \191\ California Air Resources Board (CARB), Greenhouse Gas 
Emissions and Fuel Efficiency Standards for Medium- and Heavy-Duty 
Engines and Vehicles--Phase 2 (Docket ID No. EPA-HQ-OAR-2014-0827 
and Docket ID No. NHTSA-2014-0132).
---------------------------------------------------------------------------

    The agencies carefully considered this wide range of views, and 
based on the best data available, the agencies modified some of our 
technology projections between the proposal and the final rule.
    Table II-5 lists our projected technologies together with our 
projected effectiveness and market adoption rates for tractor engines. 
The reduction values shown as ''SET reduction'' are relative to our 
Phase 2 baseline values, as shown in Table II-7. It should be pointed 
out that the reductions in Table II-7 are based on the Phase 2 final 
SET weighting factors, shown in Table II-2. RIA Chapter 2.7.5 details 
the reasoning supporting our projection of improvements attributable to 
this fleet average technology package.

                         Table II-7--Projected Tractor Engine Technologies and Reduction
----------------------------------------------------------------------------------------------------------------
                                                   SET weighted       Market          Market          Market
                    SET mode                       reduction (%)    penetration     penetration     penetration
                                                     2020-2027      (2021) (%)      (2024) (%)      (2027) (%)
----------------------------------------------------------------------------------------------------------------
Turbo compound with clutch......................             1.9               5              10              10
WHR (Rankine cycle).............................             3.6               1               5              25
Parasitic/Friction (Cyl Kits, pumps, FIE),                   1.5              45              95             100
 lubrication....................................
After-treatment (lower dP)......................             0.6              30              95             100
EGR/Intake & exhaust manifolds/Turbo/VVT/Ports..             1.1              45              95             100
Combustion/FI/Control...........................             1.1              45              95             100
Downsizing......................................             0.3              10              20              30
                                                                 -----------------------------------------------
                                                                              Overall reductions (%)
                                                                 -----------------------------------------------
Weighted reduction (%)..........................  ..............             1.7             4.0             4.8
Down speeding optimization on SET...............  ..............             0.1             0.2             0.3
                                                 ---------------------------------------------------------------
    Total % reduction...........................  ..............             1.8             4.2             5.1
----------------------------------------------------------------------------------------------------------------

    The weighted reductions shown in this table have been combined 
using the ``[Pi]-formula,'' which has been augmented to account for 
technology dis-synergies that occur when combining multiple 
technologies. A 0.85 dis-synergy factor was used for 2021, and a 0.90 
dis-synergy factor was used for 2024 and 2027.\192\ RIA Chapter 2.7.4 
provides details on the ``[Pi]-formula'' and an explanation for how the 
dis-synergy factors were determined. Some commenters argued that use of 
a single dis-synergy factor for all technologies is inappropriate. 
While we agree that it would be preferable to have a more detailed 
analysis of the dis-synergy between each pair or group of technologies, 
we do not have the information necessary to conduct such an analysis. 
In the absence of such information, the simple single value approach is 
a reasonable approximation. Moreover, we note that the degree of dis-
synergy is sufficiently small to make the impact of any errors on the 
resulting standards negligible.
---------------------------------------------------------------------------

    \192\ As used in the agencies' analyses, dis-synergy factors 
less than one reflect dis-synergy between technologies that reduce 
the overall effectiveness, while dis-synergy factors greater than 
one would indicate synergy that improves the overall effectiveness.
---------------------------------------------------------------------------

    Figure II.3 2018 HHD Figure II.4 are the samples of the HHD engine 
fuel maps used for the agencies' MY 2018 baseline engine and MY 2027 
sleeper cab engine for tractors. As can be seen from these two figures, 
the torque curve shapes are different. This is because engine down 
speeding optimization for the SET is taken into consideration, where 
the engine peak torque is increased and the engine speed is shifted to 
lower speed. All maps used by GEM for all vehicles are shown in Chapter 
2.7 of the RIA.

[[Page 73560]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.003

(ix) Technology Packages for Diesel Engines Installed in Vocational 
Vehicles
    For diesel engines (and other compression-ignition engines) used in 
vocational vehicles, the MY 2021 standards will require engine 
manufacturers to achieve, on average, a 2.3 percent reduction in fuel 
consumption and CO2 emissions beyond the Phase 2 FTP 
baselines. Beginning in MY 2024, the agencies are requiring a 3.6 
percent reduction in fuel consumption and CO2 emissions 
beyond the Phase 2 FTP baselines for all diesel engines including LHD, 
MHD, and HHD, and beginning in MY 2027 this increases to 4.2 percent, 
on average. The agencies have based these FTP standards on the 
performance of reduced parasitic and friction losses, improved after-
treatment, combustion optimization, superchargers and variable geometry 
turbochargers, physics model-based controls, improved EGR pressure 
drop, and variable valve timing (only in LHD and MHD engines).

[[Page 73561]]

The percent reduction for the MY 2021, MY 2024, and MY 2027 standards 
is based on the combination of technology effectiveness and the 
respective market adoption rates projected.
    Most of the potential engine technologies discussed previously for 
tractor engines can also be applied to vocational engines. However, 
neither of the waste heat technologies, Rankine cycle nor turbo-
compound, are likely to be applied to vocational engines because they 
are less effective under transient operation, which is weighted more 
heavily for all of the vocational sub-categories. Given the projected 
cost and complexity of such systems, we believe that for the Phase 2 
time frame manufacturers will focus their WHR development work on 
tractor applications (which will have better payback for operators), 
rather than on vocational applications. In addition, the benefits due 
to engine downsizing, which can be realized in some tractor engines, 
may not be realized at all in in the vocational sector, again because 
this control technology produces few benefits under transient 
operation.
    One of the most effective technologies for vocational engines is 
the optimization of transient controls with physics model based 
control, which would replace current look-up table based controls. 
These are described more in detail in Chapter 2.3 of the RIA. We 
project that more advanced transient controls, including different 
levels of model based control, discussed in Chapter 2.3 of the RIA, 
would continue to progress and become more broadly applicable 
throughout the Phase 2 timeframe.
    Other effective technologies include parasitic load/friction 
reduction, as well as improvements to combustion, air handling systems, 
turbochargers, and after-treatment systems. Table II-8 below lists 
those potential technologies together with the agencies' projected 
market penetration rates for vocational engines. Again, similar to 
tractor engines, the technology reduction and market penetration rates 
are estimated by combining manufacturer-submitted confidential business 
information, together with estimates reflecting the agencies' judgment, 
which is informed by historical trends in the market adoption of other 
fuel efficiency improving technologies. The reduction values shown as 
``percent reduction'' are relative to the Phase 2 FTP baselines, which 
are shown in Table II-3. The overall reductions combine the technology 
reduction values with their market adoption rates. The same set of the 
dis-synergy factors as the tractor are used for MY 2021, 2024, and 
2027.

                       Table II-8--Projected Vocational Engine Technologies and Reduction
----------------------------------------------------------------------------------------------------------------
                                                      Percent         Market          Market          Market
                   Technology                        reduction      penetration     penetration     penetration
                                                     2020-2027       2021  (%)       2024 (%)        2027 (%)
----------------------------------------------------------------------------------------------------------------
Model based control.............................             2.0              25              30              40
Parasitic/Friction..............................             1.5              60              90             100
EGR/Air/VVT/Turbo...............................             1.0              60              90             100
Improved AT.....................................             0.5              30              60             100
Combustion Optimization.........................             1.0              60              90             100
Weighted reduction (%)-L/M/HHD..................  ..............             2.3             3.6             4.2
----------------------------------------------------------------------------------------------------------------

    Figure II.5 is a sample of a 2018 baseline engine fuel map for a 
MHD vocational engine.
[GRAPHIC] [TIFF OMITTED] TR25OC16.004


[[Page 73562]]


(x) Summary of the Agencies' Analysis of the Feasibility of the Diesel 
Engine Standards
    The HD Phase 2 standards are based on projected adoption rates for 
technologies that the agencies regard as the maximum feasible for 
purposes of EISA section 32902 (k) and appropriate under CAA section 
202(a) based on the technologies discussed above and in RIA Chapter 2. 
The agencies believe these technologies can be adopted at the estimated 
rates for these standards within the lead time provided, as discussed 
in RIA Chapter 2.7. The 2021 and 2024 MY standards are phase-in 
standards on the path to the 2027 MY standards, and these earlier 
standards were developed using less aggressive application rates and 
therefore have lower technology package costs than the 2027 MY 
standards.
    As described in Section II.D.(2)(d) below, the costs to comply with 
these standards are estimated to range from $275 to $1,579 per engine. 
This is slightly higher than the costs for Phase 1, which were 
estimated to be $234 to $1,091 per engine. Although the agencies did 
not separately determine fuel savings or emission reductions due to the 
engine standards apart from the vehicle program, it is expected that 
the fuel savings will be significantly larger than these costs, and the 
emission reductions will be roughly proportional to the technology 
costs when compared to the corresponding vehicle program reductions and 
costs. Thus, we regard these standards as cost-effective. This is true 
even without considering payback period. The phase-in 2021 and 2024 MY 
standards are less stringent and less costly than the 2027 MY 
standards. Given that the agencies believe these standards are 
technologically feasible, are highly cost effective, and highly cost 
effective when accounting for the fuel savings, and have no apparent 
adverse potential impacts (e.g., there are no projected negative 
impacts on safety or vehicle utility), they appear to represent a 
reasonable choice under section 202(a) of the CAA and the maximum 
feasible under NHTSA's EISA authority at 49 U.S.C. 32902(k)(2).
(b) Basis for Continuing the Phase 1 Spark-Ignited Engine Standard
    For gasoline vocational engines, we are not adopting more stringent 
engine standards. Today most SI-powered vocational vehicles are sold as 
incomplete vehicles by a vertically integrated chassis manufacturer, 
where the incomplete chassis shares most of the same technology as 
equivalent complete pickups or vans, including the powertrain. Another, 
even less common way that SI-powered vocational vehicles are built is 
by a non-integrated chassis manufacturer purchasing an engine from a 
company that also produces complete and/or incomplete HD pickup trucks 
and vans. Gasoline engines used in vocational vehicles are generally 
the same engines as are used in the complete HD pickups and vans in the 
Class 2b and 3 weight categories, although the operational demands of 
vocational vehicles often require use of the largest, most powerful SI 
engines, so that some engines fitted in complete pickups and vans are 
not appropriate for use in vocational vehicles. Given the relatively 
small sales volumes for gasoline-fueled vocational vehicles, 
manufacturers typically cannot afford to invest significantly in 
developing separate technology for these engines.
    The agencies received many comments suggesting that technologies be 
applied to increase the stringency of the SI engine standard. These 
comments were essentially misplaced, since the agencies already had 
premised the Phase 1 SI MY 2016 FTP engine standards on 100 percent 
adoption of these technologies. The commenters thus did not identify 
any additional engine technologies that the agencies did not already 
consider and account for in setting the MY 2016 FTP engine standard. 
Therefore, the Phase 1 SI engine FTP standard for these engines will 
remain in place. However, as noted above, projected engine improvements 
are being reflected in the stringency of the vehicle standard for the 
vehicle in which the engine will be installed. In part this is because 
the GEM cycles result in very different engine operation than what 
occurs when an engine is run over the engine FTP cycle. We believe that 
certain technologies will show a fuel consumption and CO2 
emissions reduction during GEM cycles that do not occur over the engine 
FTP. We received comments on engine technologies that can be recognized 
over the GEM vehicle cycles. As a result, the Phase 2 gasoline-fueled 
vocational vehicle standards are predicated on adoption of advanced 
engine friction reduction and cylinder deactivation. To the extent any 
SI engines do not incorporate the projected engine technologies, 
manufacturers of SI-powered vocational vehicles would need to achieve 
equivalent reductions from some other vehicle technology to meet the 
vehicle standards. See Section V.C of this Preamble for a description 
of how we applied these technologies to develop the vocational vehicle 
standards. See Section VI.C of this Preamble for a description of the 
SI engine technologies that have been considered in developing the HD 
pickup truck and van standards.
(c) Engine Improvements Projected for Vehicles Over the GEM Duty Cycles
    As part of the certification process for the Phase 2 vehicle 
standards, tractor and vocational vehicle manufacturers will need to 
represent their vehicles' actual engines in GEM. Although the vehicle 
standards recognize the same engine technologies as the separate engine 
standards, each have different test procedures for demonstrating 
compliance. As explained earlier in Section II.D.(1), compliance with 
the tractor separate engine standards is determined from a composite of 
the Supplemental Engine Test (SET) procedure's 13 steady-state 
operating points. Compliance with the vocational vehicle separate 
engine standards is determined over the Federal Test Procedure's (FTP) 
transient engine duty cycle. In contrast, compliance with the vehicle 
standards is determined using GEM, which calculates composite results 
over a combination of 55 mph, 65 mph, ARB Transient and idle vehicle 
cycles. Each of these duty cycles emphasize different engine operating 
points; therefore, they can each recognize certain technologies 
differently. Hence, these engine improvements can be readily recognized 
in GEM and appropriately reflected in the stringency of the vehicle 
standards. It is important to note, however, that the tractor vehicle 
standards presented in Section III project that some (but not all) 
tractor engines will achieve greater reductions than required by the 
engine standards. This was reflected in the agencies' feasibility 
analysis using projected engine fuel maps that represent engines having 
fuel efficiency better than what is required by the engine standards. 
Similarly, the vocational vehicle standards in presented in Section V 
project that the average vocational engine will achieve greater 
reductions than required by the engine standards. These additional 
reductions are recognized by GEM and are reflected in the stringency of 
the respective vehicle standards.
    Our first step in aligning our engine technology assessment at both 
the engine and vehicle levels was to separately identify how each 
technology impacts performance at each of the 13 individual test points 
of the SET steady-state engine duty cycle. For example, engine friction 
reduction technology is expected to have the greatest impact at the 
highest engine speeds, where frictional energy losses are the greatest.

[[Page 73563]]

As another example, turbocharger technology is generally optimized for 
best efficiency at steady-state cruise vehicle speed. For an engine, 
this is near its lower peak-torque speed and at a moderately high load 
that still offers sufficient torque reserve to climb modest road grades 
without frequent transmission gear shifting. The agencies also 
considered the combination of certain technologies causing dis-
synergies with respect to engine efficiency at each of these test 
points. See RIA Chapter 2.3 and 2.7 for further details. Chapter 2.8 
and 2.9 of the RIA details how the engine fuel maps are created for 
both tractor and vocational vehicles used for GEM as the default engine 
fuel maps.
(d) Engine Technology Package Costs for Tractor and Vocational Engines 
(and Vehicles)
    As described in Chapters 2 and 7 of the RIA, the agencies estimated 
costs for each of the engine technologies discussed here. All costs are 
presented relative to engines projected to at least comply with the 
model year 2017 standards--i.e., relative to our Phase 2 baseline 
engines. Note that we are not presenting any costs for gasoline engines 
(SI engines) in this section because we are not changing the SI engine 
standards. However, we are including a cost for additional engine 
technology as part of the vocational vehicle analysis in Section 
V.C.2.(e) (and appropriately so, since those engine improvements are 
reflected in the stringency of the vocational vehicle standard).
    Our engine cost estimates include a separate analysis of the 
incremental part costs, research and development activities, and 
additional equipment. Our general approach used elsewhere in this 
action (for HD pickup trucks, gasoline engines, Class 7 and 8 tractors, 
and Class 2b-8 vocational vehicles) estimates a direct manufacturing 
cost for a part and marks it up based on a factor to account for 
indirect costs. See also 75 FR 25376. We believe that approach is 
appropriate when compliance with the standards is achieved generally by 
installing new parts and systems purchased from a supplier. In such a 
case, the supplier is conducting the bulk of the research and 
development on the new parts and systems and including those costs in 
the purchase price paid by the original equipment manufacturer. 
Consequently, the indirect costs incurred by the original equipment 
manufacturer need not reflect significant cost to cover research and 
development since the bulk of that effort is already completed. For the 
MHD and HHD diesel engine segment, however, the agencies believe that 
OEMs will incur costs not associated with the purchase of parts or 
systems from suppliers or even the production of the parts and systems, 
but rather the development of the new technology by the original 
equipment manufacturer itself. Therefore, the agencies have directly 
estimated additional indirect costs to account for these development 
costs. The agencies used the same approach in the Phase 1 HD rule. EPA 
commonly uses this approach in cases where significant investments in 
research and development can lead to an emission control approach that 
requires no new hardware. For example, combustion optimization may 
significantly reduce emissions and cost a manufacturer millions of 
dollars to develop but would lead to an engine that is no more 
expensive to produce. Using a bill of materials approach would suggest 
that the cost of the emissions control was zero reflecting no new 
hardware and ignoring the millions of dollars spent to develop the 
improved combustion system. Details of the cost analysis are included 
in the RIA Chapter 2.7. To reiterate, we have used this different 
approach because the MHD and HHD diesel engines are expected to comply 
in part via technology changes that are not reflected in new hardware 
but rather reflect knowledge gained through laboratory and real world 
testing that allows for improvements in control system calibrations--
changes that are more difficult to reflect through direct costs with 
indirect cost multipliers. Note that these engines are also expected to 
incur new hardware costs as shown in Table II-9 through Table II-12. 
EPA also developed the incremental piece cost for the components to 
meet each of the 2021 and 2024 standards. The costs shown in Table II-
13 include a low complexity ICM of 1.15 and assume the flat-portion of 
the learning curve is applicable to each technology.
(i) Tractor Engine Package Costs

 Table II-9--MY 2021 Tractor Diesel Engine Component Costs Inclusive of
                Indirect Cost Markups and Adoption Rates
                                 [2013$]
------------------------------------------------------------------------
                                             Medium HD       Heavy HD
------------------------------------------------------------------------
After-treatment system (improved                      $7              $7
 effectiveness SCR, dosing, DPF)........
Valve Actuation.........................              84              84
Cylinder Head (flow optimized, increased               3               3
 firing pressure, improved thermal
 management)............................
Turbocharger (improved efficiency)......               9               9
Turbo Compounding.......................              51              51
EGR Cooler (improved efficiency)........               2               2
Water Pump (optimized, variable vane,                 44              44
 variable speed)........................
Oil Pump (optimized)....................               2               2
Fuel Pump (higher working pressure,                    2               2
 increased efficiency, improved pressure
 regulation)............................
Fuel Rail (higher working pressure).....               5               5
Fuel Injector (optimized, improved                     5               5
 multiple event control, higher working
 pressure)..............................
Piston (reduced friction skirt, ring and               1               1
 pin)...................................
Valve train (reduced friction, roller                 39              39
 tappet)................................
Waste Heat Recovery.....................              71              71
``Right sized'' engine..................             -41             -41
                                         -------------------------------
    Total...............................             284             284
------------------------------------------------------------------------
Note: ``Right sized'' diesel engine is a smaller, less costly engine
  than the engine it replaces.


[[Page 73564]]


 Table II-10--MY 2024 Tractor Diesel Engine Component Costs Inclusive of
                Indirect Cost Markups and Adoption Rates
                                 [2013$]
------------------------------------------------------------------------
                                             Medium HD       Heavy HD
------------------------------------------------------------------------
After-treatment system (improved                     $14             $14
 effectiveness SCR, dosing, DPF)........
Valve Actuation.........................             169             169
Cylinder Head (flow optimized, increased               6               6
 firing pressure, improved thermal
 management)............................
Turbocharger (improved efficiency)......              17              17
Turbo Compounding.......................              93              93
EGR Cooler (improved efficiency)........               3               3
Water Pump (optimized, variable vane,                 85              85
 variable speed)........................
Oil Pump (optimized)....................               4               4
Fuel Pump (higher working pressure,                    4               4
 increased efficiency, improved pressure
 regulation)............................
Fuel Rail (higher working pressure).....               9               9
Fuel Injector (optimized, improved                    10              10
 multiple event control, higher working
 pressure)..............................
Piston (reduced friction skirt, ring and               3               3
 pin)...................................
Valve train (reduced friction, roller                 77              77
 tappet)................................
Waste Heat Recovery.....................             298             298
``Right sized'' engine..................             -82             -82
                                         -------------------------------
    Total...............................             712             712
------------------------------------------------------------------------
Note: ``Right sized'' diesel engine is a smaller, less costly engine
  than the engine it replaces.


 Table II-11--MY 2027 Tractor Diesel Engine Component Costs Inclusive of
                Indirect Cost Markups and Adoption Rates
                                 [2013$]
------------------------------------------------------------------------
                                             Medium HD       Heavy HD
------------------------------------------------------------------------
After-treatment system (improved                     $15             $15
 effectiveness SCR, dosing, DPF)........
Valve Actuation.........................             172             172
Cylinder Head (flow optimized, increased               6               6
 firing pressure, improved thermal
 management)............................
Turbocharger (improved efficiency)......              17              17
Turbo Compounding.......................              89              89
EGR Cooler (improved efficiency)........               3               3
Water Pump (optimized, variable vane,                 85              85
 variable speed)........................
Oil Pump (optimized)....................               4               4
Fuel Pump (higher working pressure,                    4               4
 increased efficiency, improved pressure
 regulation)............................
Fuel Rail (higher working pressure).....               9               9
Fuel Injector (optimized, improved                    10              10
 multiple event control, higher working
 pressure)..............................
Piston (reduced friction skirt, ring and               3               3
 pin)...................................
Valve train (reduced friction, roller                 77              77
 tappet)................................
Waste Heat Recovery.....................           1,208           1,208
``Right sized'' engine..................            -123            -123
                                         -------------------------------
    Total...............................           1,579           1,579
------------------------------------------------------------------------
Note: ``Right sized'' diesel engine is a smaller, less costly engine
  than the engine it replaces.

(ii) Vocational Diesel Engine Package Costs

  Table II-12--MY 2021 Vocational Diesel Engine Component Costs Inclusive of Indirect Cost Markups and Adoption
                                                      Rates
                                                     [2013$]
----------------------------------------------------------------------------------------------------------------
                                                                     Light HD        Medium HD       Heavy HD
----------------------------------------------------------------------------------------------------------------
After-treatment system (improved effectiveness SCR, dosing, DPF)              $8              $8              $8
Valve Actuation.................................................              93              93              93
Cylinder Head (flow optimized, increased firing pressure,                      6               3               3
 improved thermal management)...................................
Turbocharger (improved efficiency)..............................              10              10              10
EGR Cooler (improved efficiency)................................               2               2               2
Water Pump (optimized, variable vane, variable speed)...........              58              58              58
Oil Pump (optimized)............................................               3               3               3
Fuel Pump (higher working pressure, increased efficiency,                      3               3               3
 improved pressure regulation)..................................
Fuel Rail (higher working pressure).............................               8               6               6
Fuel Injector (optimized, improved multiple event control,                     8               6               6
 higher working pressure).......................................
Piston (reduced friction skirt, ring and pin)...................               1               1               1
Valve train (reduced friction, roller tappet)...................              70              52              52
Model Based Controls............................................              29              29              29
                                                                 -----------------------------------------------
    Total.......................................................             298             275             275
----------------------------------------------------------------------------------------------------------------


[[Page 73565]]


  Table II-13--MY 2024 Vocational Diesel Engine Component Costs Inclusive of Indirect Cost Markups and Adoption
                                                      Rates
                                                     [2013$]
----------------------------------------------------------------------------------------------------------------
                                                                     Light HD        Medium HD       Heavy HD
----------------------------------------------------------------------------------------------------------------
After-treatment system (improved effectiveness SCR, dosing, DPF)             $14             $14             $14
Valve Actuation.................................................             160             160             160
Cylinder Head (flow optimized, increased firing pressure,                     10               6               6
 improved thermal management)...................................
Turbocharger (improved efficiency)..............................              16              16              16
EGR Cooler (improved efficiency)................................               3               3               3
Water Pump (optimized, variable vane, variable speed)...........              81              81              81
Oil Pump (optimized)............................................               4               4               4
Fuel Pump (higher working pressure, increased efficiency,                      4               4               4
 improved pressure regulation)..................................
Fuel Rail (higher working pressure).............................              11               9               9
Fuel Injector (optimized, improved multiple event control,                    13              10              10
 higher working pressure).......................................
Piston (reduced friction skirt, ring and pin)...................               2               2               2
Valve train (reduced friction, roller tappet)...................              97              73              73
Model Based Controls............................................              32              32              32
                                                                 -----------------------------------------------
    Total.......................................................             446             413             413
----------------------------------------------------------------------------------------------------------------


  Table II-14--MY 2027 Vocational Diesel Engine Component Costs Inclusive of Indirect Cost Markups and Adoption
                                                      Rates
                                                     [2013$]
----------------------------------------------------------------------------------------------------------------
                                                                     Light HD        Medium HD       Heavy HD
----------------------------------------------------------------------------------------------------------------
After-treatment system (improved effectiveness SCR, dosing, DPF)             $15             $15             $15
Valve Actuation.................................................             172             172             172
Cylinder Head (flow optimized, increased firing pressure,                     10               6               6
 improved thermal management)...................................
Turbocharger (improved efficiency)..............................              17              17              17
EGR Cooler (improved efficiency)................................               3               3               3
Water Pump (optimized, variable vane, variable speed)...........              85              85              85
Oil Pump (optimized)............................................               4               4               4
Fuel Pump (higher working pressure, increased efficiency,                      4               4               4
 improved pressure regulation)..................................
Fuel Rail (higher working pressure).............................              11               9               9
Fuel Injector (optimized, improved multiple event control,                    14              10              10
 higher working pressure).......................................
Piston (reduced friction skirt, ring and pin)...................               3               3               3
Valve train (reduced friction, roller tappet)...................             102              77              77
Model Based Controls............................................              41              41              41
                                                                 -----------------------------------------------
    Total.......................................................             481             446             446
----------------------------------------------------------------------------------------------------------------

(e) Feasibility of Additional Engine Improvements
    While the agencies' technological feasibility analysis for the 
engine standards focuses on what is achievable for existing engine 
platforms, we recognize that it could be possible to achieve greater 
reductions by designing entirely new engine platforms. Unlike existing 
platforms, which are limited with respect to peak cylinder pressures 
(precluding certain efficiency improvements), new platforms can be 
designed to have higher cylinder pressure than today's engines. New 
designs are also better able to incorporate recent improvements in 
materials and manufacturing, as well as other technological 
developments. Considered together, it is likely that a new engine 
platform could be about 2 percent better than engines using older 
platforms. Moreover, the agencies have seen CBI data that suggests 
improvement of more than 3 percent are possible. However, because 
designing and producing a new engine platform requires hundreds of 
millions of dollars in capital investment and significant lead time for 
research and development, it would not be appropriate to project that 
each engine manufacturer could complete a complete redesign of all of 
its engines within the Phase 2 time frame. Unlike light-duty, heavy-
duty sales volumes are not large enough to support short redesign 
cycles. As a result, it can take 20 years for a manufacturer to 
generate the necessary return on the investment associated with an 
engine redesign. Forcing a manufacturer to redesign its engines 
prematurely could easily result in significant financial strain on a 
company.
    On the other hand, how far the various manufacturers are into their 
design cycles suggests that one or more manufacturers will probably 
introduce a new engine platform during the Phase 2 time frame. This 
would not enable other engine manufacturers to meet more stringent 
standards, and thus it would not be an appropriate basis to justify 
more stringent engine standards (and certainly not engine standards 
reflecting 100 percent use of technologies premised on existence of new 
platforms). However, the availability of some more efficient engines on 
the market will provide the opportunity for vehicle manufacturers to 
lower their average fuel consumption as measured by GEM. Vehicle 
manufacturers can use a mix of newer and older engine designs to 
achieve an average engine performance significantly better than what is 
required by the engine standards. Thus, the vehicle standards can 
reflect engine platform improvements (which are amenable to measurement 
in GEM), without necessarily forcing each manufacturer to achieve these 
additional reductions,

[[Page 73566]]

which may be achievable only for new engine platforms.
    As discussed in Section III.D.(1)(b)(i), the agencies project that 
at least one engine manufacturer (and possibly more) will have 
completed a redesign for tractor engines by 2027. Accordingly, we 
project that 50 percent of tractor engines in 2027 will be redesigned 
engines and be 1.6 percent more efficient than required by the engine 
standards, so the average engine would be 0.8 percent better. However, 
we could have projected the same overall improvement by projecting 25 
percent of engine getting 3.2 percent better. Based on the CBI 
information available to us, we believe projecting a 0.8 percent 
improvement is reasonable, but may be somewhat conservative.
    Adding this 0.8 percent improvement to the 5.1 percent reduction 
required by the standards means we project the average 2027 tractor 
engine would be 5.9 percent better than Phase 1. Because engine 
improvements for tractors are applied separately for day cabs and 
sleeper cabs in the vehicle program, we estimated separate improvements 
for them here. Specifically, we project a 5.4 percent reduction for day 
cabs and a 6.4 percent reduction in fuel consumption in sleeper cabs 
beyond Phase 1. It is important to also note that manufacturers that do 
not achieve this level would be able to make up for the difference by 
applying one of the many other tractor vehicle technologies to a 
greater extent than we project, or to achieve greater reductions by 
optimizing technology efficiency further. We are not including the cost 
of developing these new engines in our cost analysis because we believe 
these engines are going to be developed due to market forces (i.e., the 
new platform, already contemplated) rather than due to this rulemaking.
    We are making a similar new engine platform projection for 
vocational vehicles. This is because many of tractor and vocational 
engines, such as HHD, would likely share the same engine hardware with 
the exception of WHR. In addition, the model based control discussed in 
Chapter 2.3 of the RIA could integrate engines better with 
transmissions on the vehicle side. We believe manufacturers will first 
focus their efforts on improving tractor engines but still believe that 
the 2027 vocational engine will be significantly better than required 
by the engine standards.
(3) EPA Engine Standards for N2O
    EPA will continue to apply the Phase 1 N2O engine 
standard of 0.10 g/bhp-hr and a 0.02 g/bhp-hr default deterioration 
factor to the Phase 2 program. EPA adopted the cap standard for 
N2O as an engine-based standard because the agency believes 
that emissions of this GHG are technologically related solely to the 
engine, fuel, and emissions after-treatment systems, and the agency is 
not aware of any influence of vehicle-based technologies on these 
emissions. Note that NHTSA did not adopt standards for N2O 
because these emissions do not impact fuel consumption in a significant 
way.
    In the proposal we considered reducing both the standard and 
deterioration factor to 0.05 and 0.01 g/bhp-hr respectively because 
engines certified in model year 2014 were generally meeting the 
proposed standard. We also explained the process behind N2O 
formation in urea SCR after-treatment systems and how that process 
could be optimized to elicit additional N2O reductions. 80 
FR 40203. While we have seen some reductions and a few increases in 
engine family certified N2O levels across the 2014, 2015, 
and 2016 model years, the majority have remained unchanged.
    While we still believe that further optimization of SCR systems is 
possible to reduce N2O emissions, as demonstrated for some 
engine families, we do not know to what extent further optimization can 
be achieved given the tradeoffs required to meet the Phase 2 
CO2 standards. These tradeoffs potentially include advancing 
fuel injection timing to reduce CO2 emissions resulting in 
an increase in NOX emissions at the engine outlet before the 
after-treatment, increasing the needed NOX reduction 
efficiency of the SCR system. We will continue to assess N2O 
emissions as SCR technology evolves and CO2 emission 
reductions phase in, and we will revisit the standard at a later date 
to further control N2O emission. This will likely be 
included in the upcoming rule to consider more stringent NOX 
standards.

[[Page 73567]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.005


[[Page 73568]]


[GRAPHIC] [TIFF OMITTED] TR25OC16.006

(4) EPA Engine Standards for Methane
    EPA will continue to apply the Phase 1 methane engine standards to 
the Phase 2 program. EPA adopted the cap standards for CH4 
(along with N2O standards) as engine-based standards because 
the agency believes that emissions of this GHG are technologically 
related solely to the engine, fuel, and emissions after-treatment 
systems, and the agency is not aware of any influence of vehicle-based 
technologies on these emissions. We are applying these cap standards 
against the FTP duty-cycle because the FTP cycle is the most stringent 
with respect to emissions of these pollutants and we do not believe 
that a reduction is stringency from the current Phase 1 standards is 
warranted. Note that NHTSA did not adopt standards for CH4 
(or N2O) because these emissions do not impact fuel 
consumption in a significant way.
    EPA continues to believe that manufacturers of most engine 
technologies will be able to comply with the Phase 1 CH4 
standard with no technological improvements. We note that we are not 
aware of any new technologies that would have allowed us to adopt more 
stringent standards at this time.
(5) Compliance Provisions and Flexibilities for Engine Standards
    The agencies are continuing most of the Phase 1 compliance 
provisions and flexibilities for the Phase 2 engine standards.
(a) Averaging, Banking, and Trading
    The agencies' general approach to averaging is discussed in Section 
I. We did not propose to offer any new or special credits to engine 
manufacturers to comply with any of the separate engine standards. 
Except for early credits, the agencies are retaining all Phase 1 credit 
flexibilities and limitations to continue for use in the Phase 2 engine 
program.
    As discussed below and as proposed, EPA is changing the useful life 
for LHD engines for GHG emissions from the current 10 years/110,000 
miles to 15 years/150,000 miles to be consistent with the useful life 
of criteria pollutants recently updated in EPA's Tier 3 rule. In order 
to ensure that banked credits maintain their value in the transition 
from Phase 1 to Phase 2, EPA and NHTSA are adopting the proposed 
adjustment factor of 1.36 (i.e., 150,000 mile / 110,000 miles) for 
credits that are carried forward from Phase 1 to the MY 2021 and later 
Phase 2 standards. Without this adjustment factor the change in useful 
life would have effectively resulted in a discount of banked credits 
that are carried forward from Phase 1 to Phase 2, which is not the 
intent of the change in the useful life. See Sections V and VI for 
additional discussion of similar adjustments of vehicle-based credits.
    Finally, the agencies are limiting the carryover of certain Phase 1 
engine credits into the Phase 2 program. As described in Section 
II.D.(2) the agencies made adjustments to the FTP baselines, to address 
the unexpected step-change improvement in engine fuel consumption and 
CO2 emissions. The underlying reasons for this shift are 
mostly related to manufacturers optimizing their SCR thermal management 
strategy over the FTP in ways that we (mistakenly) thought they already 
had in MY 2010 (i.e., the Phase 1 baseline). At the time of Phase 1 we 
had not realized that these improvements were not already in the Phase 
1 baseline. This issue does not apply for SET emissions, and thus only 
significantly impacts engines certified

[[Page 73569]]

exclusively to the FTP standards (rather than both FTP and SET 
standards). To prevent manufacturers from diluting the Phase 2 engine 
program with credits generated relative to this incorrect baseline, we 
are not allowing engine credits generated against the Phase 1 FTP 
standards to be carried over into the Phase 2 program.
(b) Changing Global Warming Potential (GWP) Values in the Credit 
Program for CH4 and N2O
    The Phase 1 rule included a compliance flexibility that allowed 
heavy-duty manufacturers and conversion companies to comply with the 
respective methane or nitrous oxide standards by means of over-
complying with CO2 standards (40 CFR 1036.705(d)). The 
heavy-duty rules allow averaging only between vehicles or engines of 
the same designated type (referred to as an ``averaging set'' in the 
rules). Specifically, the Phase 1 heavy-duty rulemaking added a 
CO2 credits program which allowed heavy-duty engine 
manufacturers to average and bank emission credits to comply with the 
methane and nitrous oxide requirements after adjusting the 
CO2 emission credits based on the relative GWP equivalents. 
To establish the GWP equivalents used by the CO2 credits 
program, the Phase 1 rule incorporated the IPCC Fourth Assessment 
Report GWP values of 25 for CH4 and 298 for N2O, 
which are assessed over a 100 year lifetime.
    EPA will continue this provision for Phase 2. However, since the 
Phase 1 rule was finalized, a new IPCC report has been released (the 
Fifth Assessment Report), with new GWP estimates. This caused us to 
look again at the relative GWP equivalency of methane and nitrous oxide 
and to seek comment on whether the methane and nitrous oxide GWPs used 
to establish the equivalency value for the CO2 Credit 
program should be updated to those established by IPCC in its Fifth 
Assessment Report. 80 FR 40206. The Fifth Assessment Report provides 
four 100 year GWP values for methane ranging from 28 to 36 and two 100 
year GWP values for nitrous oxide, either 265 or 298.
    EPA is updating the GWP value to convert CO2 credits for 
use against the methane standard. We are using a GWP of 34 for the 
value of methane reductions relative to CO2 reductions. (The 
GWP remains 298 for N2O). The use of this new methane GWP 
will not begin until MY 2021, when the Phase 2 engine standards begin. 
This provides sufficient lead time for both the agencies and 
manufacturers to update systems, and also ensures that manufacturers 
would be able make any necessary design changes. The choice of when to 
commence use of this GWP value for our engines standards does not 
prejudice the choice of other GWP values for use in regulations and 
other purposes in the near term. Further discussion is found in Section 
XI.D.2.a.
(c) In-Use Compliance and Useful Life
    Consistent with section 202(a)(1) and 202(d) of the CAA, for Phase 
1, EPA established in-use standards for heavy-duty engines. Based on 
our assessment of testing variability and other relevant factors, we 
established in-use standards by adding a 3 percent adjustment factor to 
the full useful life CO2 emissions and fuel consumption 
results measured in the EPA certification process to address 
measurement variability inherent in comparing results among different 
laboratories and different engines. See 40 CFR part 1036. The agencies 
are not changing this for Phase 2 SET and FTP engine standard 
compliance.
    In Phase 1, EPA set the useful life for engines and vehicles with 
respect to GHG emissions equal to the respective useful life periods 
for criteria pollutants. In April 2014, as part of the Tier 3 light-
duty vehicle final rule, EPA extended the regulatory useful life period 
for criteria pollutants to 150,000 miles or 15 years, whichever comes 
first, for Class 2b and 3 pickup trucks and vans and some light-duty 
trucks (79 FR 23414, April 28, 2014). As proposed, EPA is applying the 
same useful life of 150,000 miles or 15 years for the Phase 2 GHG 
standards for engines primarily intended for use in vocational vehicles 
with a GVWR at or below 19,500 lbs. NHTSA will use the same useful life 
values as EPA for all heavy-duty vehicles.
    As proposed, we will continue the regulatory allowance in 40 CFR 
1036.150(g) that allows engine manufacturers to use assigned 
deterioration factors (DFs) for most engines without performing their 
own durability emission tests or engineering analysis. However, the 
engines will still be required to meet the standards in actual use 
without regard to whether the manufacturer used the assigned DFs. This 
allowance is being continued as an interim provision and may be 
discontinued for later phases of standards as more information becomes 
known. Manufacturers are allowed to use an assigned additive DF of 0.0 
g/bhp-hr for CO2 emissions from any conventional engine 
(i.e., an engine not including advanced or off-cycle technologies). 
Upon request, we could allow the assigned DF for CO2 
emissions from engines including advanced or off-cycle technologies, 
but only if we determine that it would be consistent with good 
engineering judgment. We believe that we have enough information about 
in-use CO2 emissions from conventional engines to conclude 
that they will not increase as the engines age. However, we lack such 
information about the more advanced technologies. For technologies such 
as WHR that are considered advanced in the context of Phase 1, but 
would be treated as a more ordinary technology by the end of Phase 2, 
we plan to work with manufacturers to determine if using the assigned 
zero DF would be appropriate.
(d) Alternate CO2 Standards
    In the Phase 1 rulemaking, the agencies allowed certification to 
alternate CO2 engine standards in model years 2014 through 
2016. This flexibility was intended to address the special case of 
needed lead time to implement new standards for a previously 
unregulated pollutant. Since that special case does not apply for Phase 
2, we are not adopting a similar flexibility in this rulemaking.
(e) Approach to Standards and Compliance Provisions for Natural Gas 
Engines
    EPA is also making certain clarifying changes to its rules 
regarding classification of natural gas engines. This relates to 
standards for all emissions, both greenhouse gases and criteria 
pollutants. These clarifying changes are intended to reflect the status 
quo, and therefore should not have any associated costs.
    EPA emission standards have always applied differently for 
gasoline-fueled and diesel-fueled engines. The regulations in 40 CFR 
part 86 implement these distinctions by dividing engines into Otto-
cycle and Diesel-cycle technologies. This approach led EPA to 
categorize natural gas engines according to their design history. A 
diesel engine converted to run on natural gas was classified as a 
diesel-cycle engine; a gasoline engine converted to run on natural gas 
was classified as an Otto-cycle engine.
    The Phase 1 rule described our plan to transition to a different 
approach, consistent with EPA's non-road programs, in which we divide 
engines into compression-ignition and spark-ignition technologies based 
only on the thermodynamic operating characteristics of the 
engines.\193\ However, the Phase 1 rule included a provision allowing 
us to continue with

[[Page 73570]]

the historic approach on an interim basis.
---------------------------------------------------------------------------

    \193\ See 40 CFR 1036.108.
---------------------------------------------------------------------------

    Under the existing EPA regulatory definitions of ``compression-
ignition'' and ``spark-ignition,'' a natural gas engine would generally 
be considered compression-ignition if it operates with lean air-fuel 
mixtures and uses a pilot injection of diesel fuel to initiate 
combustion, and would generally be considered spark-ignition if it 
operates with stoichiometric air-fuel mixtures and uses a spark plug to 
initiate combustion.
    EPA's basic premise here is that natural gas engines performing 
similar in-use functions as diesel engines should be subject to similar 
regulatory requirements. The compression-ignition emission standards 
and testing requirements reflect the operating characteristics for the 
full range of heavy-duty vehicles, including substantial operation in 
long-haul service characteristic of tractors. The spark-ignition 
emission standards and testing requirements do not include some of 
those provisions related to use in long-haul service or other 
applications where diesel engines predominate, such as steady-state 
testing, Not-to-Exceed standards, and extended useful life. We believe 
it would be inappropriate to apply the spark-ignition standards and 
requirements to natural gas engines that are being used in applications 
mostly served by diesel engines today. We therefore proposed to replace 
the interim provision described above with a differentiated approach to 
certification of natural gas engines across all of the EPA standards--
for both GHGs and criteria pollutants. 80 FR 40207. Under the proposed 
amendment, we would require manufacturers to divide all their natural 
gas engines into primary intended service classes, as we already 
require for compression-ignition engines, whether or not the engine has 
features that otherwise could (in theory) result in classification as 
SI under the current rules. We proposed that any natural gas engine 
qualifying as a medium heavy-duty engine (19,500 to 33,000 lbs. GVWR) 
or a heavy heavy-duty engine (over 33,000 lbs. GVWR) would be subject 
to all the emission standards and other requirements that apply to 
compression-ignition engines. However, based on comments, we are 
finalizing this change only for heavy heavy-duty engines. Commenters 
identified medium heavy-duty applications in which SI alternative fuel 
engines compete significantly with gasoline engines, which is not 
consistent with the premise of the proposal. Thus, we are not 
finalizing the proposed change for medium heavy-duty engines.
    Table II-15 describes the provisions that apply differently for 
compression-ignition and spark-ignition engines:

 Table II-15--Regulatory Provisions That Are Different for Compression-
                   Ignition and Spark-Ignition Engines
------------------------------------------------------------------------
           Provision             Compression-ignition    Spark-ignition
------------------------------------------------------------------------
Transient duty cycle...........  40 CFR part 86,       40 CFR part 86,
                                  Appendix I,           Appendix I,
                                  paragraph (f)(2)      paragraph (f)(1)
                                  cycle; divide by      cycle.
                                  1.12 to de-
                                  normalize.
Ramped-modal test (SET)........  yes.................  no.
NTE standards..................  yes.................  no.
Smoke standard.................  yes.................  no.
Manufacturer-run in-use testing  yes.................  no.
ABT--pollutants................  NOX, PM.............  NOX, NMHC.
ABT--transient conversion        6.5.................  6.3.
 factor.
ABT--averaging set.............  Separate averaging    One averaging set
                                  sets for light,       for all SI
                                  medium, and heavy     engines.
                                  HDDE.
Useful life....................  110,000 miles for     110,000 miles.
                                  light HDDE, \a\       \a\
                                  185,000 miles for
                                  medium HDDE,
                                  435,000 miles for
                                  heavy HDDE.
Warranty.......................  50,000 miles for      50,000 miles.
                                  light HDDE, 100,000
                                  miles for medium
                                  HDDE, 100,000 miles
                                  for heavy HDDE.
Detailed AECD description......  yes.................  no.
Test engine selection..........  highest injected      most likely to
                                  fuel volume.          exceed emission
                                                        standards.
------------------------------------------------------------------------
Note:
 
\a\ As proposed, useful life for light heavy-duty diesel and spark
  ignition engines is being increased to 150,000 miles for GHG
  emissions, but remains at 110,000 for criteria pollutant emissions.

    The onboard diagnostic requirements already differentiate 
requirements by fuel type, so there is no need for those provisions to 
change based on the considerations of this section.
    We are not aware of any currently certified engines that will 
change from compression-ignition to spark-ignition under this approach. 
Nonetheless, because these proposed changes could result in a change in 
standards for engines currently under development, we believe it is 
appropriate to provide additional lead time. We will therefore continue 
to apply the existing interim provision through model year 2020.\194\ 
Starting in model year 2021, all the provisions will apply as described 
above for heavy heavy-duty engines. Manufacturers will not be permitted 
to certify any engine families using carryover emission data if a 
particular engine model switched from compression-ignition to spark-
ignition, or vice versa. However, as noted above, in practice these 
vehicles are already being certified as CI engines, so we view these 
changes as clarifications ratifying the current status quo.
---------------------------------------------------------------------------

    \194\ Section 202(a)(2), applicable to emissions of greenhouse 
gases, does not mandate a specific period of lead time, but EPA sees 
no reason for a different compliance date here for GHGs and criteria 
pollutants. This is also true with respect to the closed crankcase 
emissions discussed in the following subsection. Also, as explained 
in section I.E.i.e, EPA interprets the phrase ``classes or 
categories of heavy duty vehicles or engines'' in CAA section 
202(a)(3)(C) to refer to categories of vehicles established 
according to features such as their engine cycle (spark-ignition or 
compression-ignition).l.
---------------------------------------------------------------------------

    These provisions will apply equally to engines fueled by any fuel 
other than gasoline or ethanol, should such engines be produced in the 
future. Given the current and historic market for vehicles above 33,000 
lbs. GVWR, the agencies believe any alternative-fueled vehicles in this 
weight range will be competing primarily with diesel vehicles and 
should be subject to the same requirements as them. See Sections XI and 
XII for additional discussion of natural gas fueled engines.

[[Page 73571]]

(f) Crankcase Emissions From Natural Gas Engines
    EPA proposed to require that all natural gas-fueled engines have 
closed crankcases, rather than continuing the provision that allows 
venting to the atmosphere all crankcase emissions from all compression-
ignition engines. 80 FR 40208. However, EPA is not finalizing the 
proposed requirement at this time.
    Open crankcases have been allowed as long as these vented crankcase 
emissions are measured and accounted for as part of an engine's 
tailpipe emissions. This allowance has historically been in place to 
address the technical limitations related to recirculating diesel-
fueled engines' crankcase emissions, which have high PM emissions, back 
into the engine's air intake. High PM emissions vented into the intake 
of an engine can foul turbocharger compressors and after cooler heat 
exchangers. In contrast, historically EPA has mandated closed crankcase 
technology on all gasoline fueled engines and all natural gas spark-
ignition engines.\195\ The inherently low PM emissions from these 
engines posed no technical barrier to a closed crankcase mandate. 
However, after considering the comments on this issue, we now believe 
that there are practical reasons why we should not close natural gas 
crankcases without also requiring closed crankcases for other 
compression-ignition engines. Because current natural gas engines are 
generally produced from diesel engine designs that are not designed to 
operate with closed crankcases, we have concerns that sealing the 
crankcase on the natural gas versions will require substantial 
development effort, and the seals may not function properly. Thus, we 
expect to update our regulations for crankcase emissions from all 
compression ignition engines at the same time in a future rulemaking.
---------------------------------------------------------------------------

    \195\ See 40 CFR 86.008-10(c).
---------------------------------------------------------------------------

(g) Compliance Margins
    Some commenters suggested that the agencies should apply a 
compliance margin to confirmatory and SEA test results to account for 
variability of engine maps and emission tests. However, EPA's past 
practice has been to base the standards on technology projections that 
assume manufacturers will apply compliance margins to their test 
results for certification. In other words, they design their products 
to have emissions below the standards by some small margin so that 
test-to-test or lab-to-lab variability would not cause them to exceed 
any applicable standards. Consequently, EPA has typically not set 
standards precisely at the lowest levels achievable, but rather at 
slightly higher levels--expecting manufacturers to target the lower 
levels to provide compliance margins for themselves. The agencies have 
applied this approach to the Phase 2 standards. Thus, the feasibility 
and cost analyses reflect the expectation that manufacturers will 
target lower values to provide compliance margins.
    The agencies have also improved the engine test procedures and 
compliance provisions to reduce the agencies' and the manufacturers' 
uncertainty of engine test results. For example, in the agencies' 
confirmatory test procedures we are requiring that the agencies use the 
average of at least three tests (i.e., the arithmetic mean of a sample 
size of at least three test results) for determining the values of 
confirmatory test results for any GEM engine fuel maps. We are only 
doing this for GEM engine fuel maps because these are relatively new 
tests, compared to Phase 1 testing or EPA's other emissions standards. 
Therefore, this provision does not apply to any other emissions 
testing. For all other emissions testing besides GEM engine fuel maps 
the agencies' maintain our usual convention of utilizing a sample size 
of one for confirmatory testing. For GEM engine fuel mapping this at 
least triples the test burden for the agencies to conduct confirmatory 
testing, but it also decreases confirmatory test result uncertainty by 
at least 42 percent.\196\ Based on improvements like this one, and 
others described in Section 1.4 of the RTC, we believe that SET, FTP 
and GEM's steady-state, cycle-average and powertrain test results will 
have an overall uncertainty of +/-1.0 percent. To further protect 
against falsely high emissions results or false failures due to this 
remaining level of test procedure uncertainty, we have included a +1 
percent compliance margin into our stringency analyses of the engine 
standards and the GEM fuel map inputs used to determine the tractor and 
vocational vehicle standards. In other words we set Phase 2 engine and 
vehicle standards 1 percent less stringent than if we had not 
considered this test procedure uncertainty.
---------------------------------------------------------------------------

    \196\ The statistical formula for standard error, which is a 
well-accepted measure of uncertainty, is the standard deviation 
times the reciprocal of the square root of the sample size. For a 
sample size of three, the reciprocal of the square root of three is 
approximately 0.58, which results in a 42% reduction in uncertainty, 
versus a sample size of one.
---------------------------------------------------------------------------

    In addition to the test procedure improvements and the +1 percent 
margin we incorporated into our standards, the agencies are also 
committed to a process of continuous improvement of test procedures to 
further reduce test result uncertainty. To contribute to this effort, 
in mid-2016 EPA committed $250,000 to fund research to further evaluate 
individual sources of engine mapping test procedure uncertainty. This 
work will occur at SwRI. Should the results of this work or other 
similar future work indicate test procedure improvements that would 
further reduce test result uncertainty, the agencies will incorporate 
these improvements through appropriate guidance or through technical 
amendments to the regulations via a notice and comment rulemaking. If 
we determine in the future through the SwRI work or other work that 
such improvements eliminate the need to require the agencies to conduct 
triplicate confirmatory testing of GEM engine fuel maps, we will 
promulgate technical amendments to the regulations to remove this 
requirement. If we determine in the future through the SwRI work or 
other work that the +1.0 percent we factored into our stringency 
analysis was inappropriately low or high, we will promulgate technical 
amendments to the regulations to address any inappropriate impact this 
+1.0 percent had on the stringency of the engine and vehicle 
standards.\197\ In addition, whenever the agencies determine whether or 
not confirmatory test results are statistically significantly different 
from manufacturers' declared values, the agencies will use good 
engineering judgment to appropriately factor into such determinations 
the results of this SwRI work and/or any other future work that 
quantifies our test procedures' uncertainty.
---------------------------------------------------------------------------

    \197\ Note that this +1.0 percent compliance margin built into 
the standards, or any other future determination of test procedure 
uncertainty, does not impact the agencies' technology feasibility or 
cost-benefit analyses for this rulemaking.
---------------------------------------------------------------------------

III. Class 7 and 8 Combination Tractors

    Class 7 and 8 combination tractors-trailers contribute the largest 
portion of the total GHG emissions and fuel consumption of the heavy-
duty sector, approximately 60 percent, due to their large payloads, 
their high annual miles traveled, and their major role in national 
freight transport.\198\ These vehicles

[[Page 73572]]

consist of a cab and engine (tractor or combination tractor) and a 
trailer.\199\ In general, reducing GHG emissions and fuel consumption 
for these vehicles will involve improvements to all aspects of the 
vehicle.
---------------------------------------------------------------------------

    \198\ The on-highway Class 7 and 8 combination tractor-trailers 
constitute the vast majority of this regulatory category. A small 
fraction of combination tractors are used in off-road applications 
and are regulated differently, as described in Section III.C.
    \199\ ``Tractor'' is defined in 49 CFR 571.3 to mean ``a truck 
designed primarily for drawing other motor vehicles and not so 
constructed as to carry a load other than a part of the weight of 
the vehicle and the load so drawn.''
---------------------------------------------------------------------------

    As we found during the development in Phase 1 and as continues to 
be true in the industry today, the heavy-duty combination tractor-
trailer industry consists of separate tractor manufacturers and trailer 
manufacturers. We are not aware of any manufacturer that typically 
assembles both the finished truck and the trailer and introduces the 
combination into commerce for sale to a buyer. There are also large 
differences in the kinds of manufacturers involved with producing 
tractors and trailers. For HD highway tractors and their engines, a 
relatively limited number of manufacturers produce the vast majority of 
these products. The trailer manufacturing industry is quite different, 
and includes a large number of companies, many of which are relatively 
small in size and production volume. Setting standards for the products 
involved--tractors and trailers--requires recognition of the large 
differences between these manufacturing industries, which can then 
warrant consideration of different regulatory approaches. Thus, 
although tractor-trailers operate essentially as a unit from both a 
commercial standpoint and for purposes of fuel efficiency and 
CO2 emissions, the agencies have developed separate 
standards for each.
    Based on these industry characteristics, EPA and NHTSA believe that 
the most appropriate regulatory approach for combination tractors and 
trailers is to establish standards for tractors separately from 
trailers. As discussed below in Section IV, the agencies are also 
adopting standards for certain types of trailers.

A. Summary of the Phase 1 Tractor Program

    The design of each tractor's cab and drivetrain determines the 
amount of power that the engine must produce in moving the truck and 
its payload down the road. As illustrated in Figure III-1, the loads 
that require additional power from the engine include air resistance 
(aerodynamics), tire rolling resistance, and parasitic losses 
(including accessory loads and friction in the drivetrain). The 
importance of the engine design is that it determines the basic GHG 
emissions and fuel consumption performance for the variety of demands 
placed on the vehicle, regardless of the characteristics of the cab in 
which it is installed.
[GRAPHIC] [TIFF OMITTED] TR25OC16.007

    Accordingly, for Class 7 and 8 combination tractors, the agencies 
adopted two sets of Phase 1 tractor standards for fuel consumption and 
CO2 emissions. The CO2 emission and fuel 
consumption reductions related to engine technologies are recognized in 
the engine standards. For vehicle-related emissions and fuel 
consumption, tractor manufacturers are required to meet vehicle-based 
standards. Compliance with the vehicle standard must be determined 
using the GEM vehicle simulation tool.
---------------------------------------------------------------------------

    \200\ Adapted from Figure 4.1. Class 8 Truck Energy Audit, 
Technology Roadmap for the 21st Century Truck Program: A Government-
Industry Research Partnership, 21CT-001, December 2000.
---------------------------------------------------------------------------

    The Phase 1 tractor standards were based on several key attributes 
related to GHG emissions and fuel consumption that reasonably represent 
the many differences in utility and performance among these vehicles. 
Attribute-based standards in general recognize the variety of functions 
performed by vehicles and engines, which in turn can affect the kind of 
technology that is available to control emissions and reduce fuel 
consumption, or its effectiveness. Attributes that characterize 
differences in the design of vehicles, as well as differences in how 
the vehicles will be employed in-use, can be key factors in evaluating 
technological improvements for reducing CO2 emissions and 
fuel consumption. Developing an appropriate attribute-based standard 
can also avoid interfering with the ability of the market to offer a 
variety of products to meet the customer's demand. The Phase 1 tractor 
standards differ depending on GVWR (i.e., whether the truck is Class 7 
or Class 8), the height of the roof of the cab, and whether it is a 
``day cab'' or a ``sleeper cab.'' These later two attributes are 
important

[[Page 73573]]

because the height of the roof, designed to correspond to the height of 
the trailer, significantly affects air resistance, and a sleeper cab 
generally corresponds to the opportunity for extended duration idle 
emission and fuel consumption improvements. Based on these attributes, 
the agencies created nine subcategories within the Class 7 and 8 
combination tractor category. The Phase 1 rules set standards for each 
of them. Phase 1 standards began with the 2014 model year and were 
followed with more stringent standards following in model year 
2017.\201\ The standards represent an overall fuel consumption and 
CO2 emissions reduction up to 23 percent from the tractors 
and the engines installed in them when compared to a baseline 2010 
model year tractor and engine without idle shutdown technology. 
Although the EPA and NHTSA standards are expressed differently (grams 
of CO2 per ton-mile and gallons per 1,000 ton-mile 
respectively), the standards are equivalent.
---------------------------------------------------------------------------

    \201\ Manufacturers may have voluntarily opted-in to the NHTSA 
fuel consumption standards in model years 2014 or 2015. Once a 
manufacturer opts into the NHTSA program it must stay in the program 
for all optional MYs.
---------------------------------------------------------------------------

    In Phase 1, the agencies allowed manufacturers to certify certain 
types of combination tractors as vocational vehicles. These are 
tractors that do not typically operate at highway speeds, or would 
otherwise not benefit from efficiency improvements designed for line-
haul tractors (although standards still apply to the engines installed 
in these vehicles). The agencies created a subcategory of ``vocational 
tractors,'' or referred to as ``special purpose tractors'' in 40 CFR 
part 1037, because real world operation of these tractors is better 
represented by our Phase 1 vocational vehicle duty cycle than the 
tractor duty cycles. Vocational tractors are subject to the standards 
for vocational vehicles rather than the combination tractor standards. 
In addition, specific vocational tractors and heavy-duty vocational 
vehicles primarily designed to perform work off-road or having tires 
installed with a maximum speed rating at or below 55 mph are exempted 
from the Phase 1 standards.
    In Phase 1, the agencies also established separate performance 
standards for the engines manufactured for use in these tractors. EPA's 
engine-based CO2 standards and NHTSA's engine-based fuel 
consumption standards are being implemented using EPA's existing test 
procedures and regulatory structure for criteria pollutant emissions 
from medium- and heavy-duty engines. These engine standards vary 
depending on engine size linked to intended vehicle service class 
(which are the same service classes used for many years for EPA's 
criteria pollutant standards).
    Manufacturers demonstrate compliance with the Phase 1 tractor 
standards using the GEM simulation tool. As explained in Section II 
above, GEM is a customized vehicle simulation model which is the 
preferred approach to demonstrating compliance testing for combination 
tractors rather than chassis dynamometer testing used in light-duty 
vehicle compliance. As discussed in the development of HD Phase 1 and 
recommended by the NAS 2010 study, a simulation tool is the preferred 
approach for HD tractor compliance because of the extremely large 
number of vehicle configurations.\202\ The GEM compliance tool was 
developed by EPA and is an accurate and cost-effective alternative to 
measuring emissions and fuel consumption while operating the vehicle on 
a chassis dynamometer. Instead of using a chassis dynamometer as an 
indirect way to evaluate real world operation and performance, various 
characteristics of the vehicle are measured and these measurements are 
used as inputs to the model. For HD Phase 1, these characteristics 
relate to key technologies appropriate for this category of truck 
including aerodynamic features, weight reductions, tire rolling 
resistance, the presence of idle-reducing technology, and vehicle speed 
limiters. The model also assumes the use of a representative typical 
engine in compliance with the separate, applicable Phase 1 engine 
standard. Using these inputs, the model is used to quantify the overall 
performance of the vehicle in terms of CO2 emissions and 
fuel consumption. CO2 emission reduction and fuel 
consumption technologies not measured by the model must be evaluated 
separately, and the HD Phase 1 rules establish mechanisms allowing 
credit for such ``off-cycle'' technologies.
---------------------------------------------------------------------------

    \202\ National Academy of Science. ``Technologies and Approaches 
to Reducing the Fuel Consumption of Medium- and Heavy-Duty 
Vehicles.'' 2010. Recommendation 8-4 stated ``Simulation modeling 
should be used with component test data and additional tested inputs 
from powertrain tests, which could lower the cost and administrative 
burden yet achieve the needed accuracy of results.''
---------------------------------------------------------------------------

    In addition to the final Phase 1 tractor-based standards for 
CO2, EPA adopted a separate standard to reduce leakage of 
HFC refrigerant from cabin air conditioning (A/C) systems from 
combination tractors that apply to the tractor manufacturer. This HFC 
leakage standard is independent of the CO2 tractor standard. 
Manufacturers can choose technologies from a menu of leak-reducing 
technologies sufficient to comply with the standard, as opposed to 
using a test to measure performance.
    The Phase 1 program also provided several flexibilities to advance 
the goals of the overall program while providing alternative pathways 
to achieve compliance. The primary flexibility is the averaging, 
banking, and trading program which allows emissions and fuel 
consumption credits to be averaged within an averaging set, banked for 
up to five years, or traded among manufacturers. Manufacturers with 
credit deficits were allowed to carry-forward credit deficits for up to 
three model years, similar to the LD GHG and CAFE carry-back credits. 
Phase 1 also included several interim provisions, such as incentives 
for advanced technologies and provisions to obtain credits for 
innovative technologies (called off-cycle in the Phase 2 program) not 
accounted for by the HD Phase 1 version of GEM or for certifying early.

B. Overview of the Phase 2 Tractor Program and Key Changes From the 
Proposal

    The HD Phase 2 program is similar in many respects to the Phase 1 
approach. The agencies are keeping the Phase 1 attribute-based 
regulatory structure in terms of dividing the tractor category into the 
same nine subcategories based on the tractor's GVWR, cab configuration, 
and roof height. This structure is working well in the implementation 
of Phase 1. EMA and Daimler supported this approach again in their 
comments to the Phase 2 NPRM. The one area where the agencies are 
changing the regulatory structure is related to heavy-haul tractors. As 
noted above, the Phase 1 regulations include a set of provisions that 
allow vocational tractors to be treated as vocational vehicles. 
However, because the agencies are including the powertrain as part of 
the technology basis for the tractor and vocational vehicle standards 
in Phase 2, we are classifying a certain set of these vocational 
tractors as heavy-haul tractors and subjecting them to a separate 
tractor standard that reflects their unique powertrain requirements and 
limitations in application of technologies to reduce fuel consumption 
and CO2 emissions.\203\ The agencies are adopting some 
revisions to the proposed Phase 2 criteria used to define heavy-haul 
tractors in response

[[Page 73574]]

to comments, as discussed below in Section III.C.4.
---------------------------------------------------------------------------

    \203\ See 76 FR 57138 for Phase 1 discussion. See 40 CFR 
1037.801 for Phase 2 heavy-haul tractor regulatory definition.
---------------------------------------------------------------------------

    The agencies will retain much of the certification and compliance 
structure developed in Phase 1. The Phase 2 tractor CO2 
emissions and fuel consumption standards, as in Phase 1, will be 
aligned.\204\ The agencies will also continue to have separate engine 
and vehicle standards to drive technology improvements in both areas. 
The reasoning behind maintaining separate standards is discussed above 
in Section II.B.2. As in Phase 1, the manufacturers will certify 
tractors using the GEM simulation tool and evaluate the performance of 
subsystems through testing (the results of this testing to be used as 
inputs to the GEM simulation tool). Other aspects of the HD Phase 2 
certification and compliance program also mirror the Phase 1 program, 
such as maintaining a single reporting structure to satisfy both 
agencies, requiring limited data at the beginning of the model year for 
certification, and determining compliance based on end of year reports. 
In the Phase 1 program, manufacturers participating in the ABT program 
provided 90 day and 270 day reports after the end of the model year. 
For the Phase 2 program, the agencies proposed that manufacturers would 
only be required to submit one end of the year report, which would have 
simplified reporting. Manufacturers provided comments opposing this 
approach. After further consideration, the agencies are adopting an 
approach in Phase 2 that mirrors the Phase 1 approach with a 90 day 
preliminary report and a 270 day final report, with the manufacturer 
having the option to request a waiver of the 90 day report based on 
positive credit balances.
---------------------------------------------------------------------------

    \204\ Fuel consumption is calculated from CO2 using 
the conversion factor of 10,180 grams of CO2 per gallon 
for diesel fuel.
---------------------------------------------------------------------------

    Even though many aspects of the HD Phase 2 program are similar to 
Phase 1, there are some key differences. While Phase 1 focused on 
reducing CO2 emissions and fuel consumption in tractors 
through the application of existing (``off-the-shelf'') technologies, 
the HD Phase 2 standards seek additional reductions through increased 
use of existing technologies and the development and deployment of more 
advanced technologies. The agencies received numerous comments on the 
proposed Phase 2 technology assessments in terms of the baseline, the 
technology effectiveness, the market adoption rate projections, and the 
technology costs. The agencies have made changes reflecting our 
assessment of these comments, as described in Section III.D.
    To evaluate the effectiveness of a more comprehensive set of 
technologies in Phase 2, the agencies are including several additional 
inputs to the Phase 2 GEM. The set of inputs includes the Phase 1 
inputs plus parameters to assess the performance of the engine, 
transmission, and driveline. Specific inputs for, among others, 
predictive cruise control, automatic tire inflation systems, and 6x2 
axles will now be required. The final Phase 2 program includes some 
changes to the proposed Phase 2 technology inputs to GEM. These changes 
from proposal include the use of cycle-averaged fuel maps for use when 
evaluating a vehicle over the transient cycle, optional transmission 
efficiency inputs, optional axle efficiency inputs, an increase in the 
types of idle reduction technologies recognized in GEM, and the ability 
to recognize the effectiveness of tire pressure monitoring systems, 
neutral coast, and neutral idle. As in Phase 1, in Phase 2 
manufacturers will conduct component testing to obtain the values for 
these technologies (should they choose to use them), then the testing 
values will be input into the GEM simulation tool. See Section III.D.1 
below. To effectively assess performance of the technologies, the 
agencies are adopting a revised version of the road grade profiles 
proposed for Phase 2. Finally, the agencies are adopting Phase 2 
regulations with clarified selective enforcement and confirmatory 
testing requirements for the GEM inputs that differ from the Phase 2 
NPRM based on the comments received.
    The key aerodynamic assessment areas that the agencies proposed to 
change in Phase 2 relative to Phase 1 were the use of a more 
aerodynamic reference trailer, the inclusion of the impact of wind on 
the tractor, and changes to the aerodynamic test procedures. We are 
adopting these changes in Phase 2 with some further revisions from 
those proposed for Phase 2 based on comments. To reflect the evolving 
trailer market, the agencies are adopting as proposed the addition of 
trailer skirts (an aerodynamic improving device) to the reference 
trailer (i.e. the trailer used during testing to determine the relative 
aerodynamic performance of the tractor). The agencies are also adopting 
the proposed aerodynamic certification test procedure that captures the 
impact of wind average drag on tractor aerodynamic performance. 
However, the agencies are specifying in the final rule the use of a 
single surrogate yaw angle instead of a full yaw sweep to reduce the 
aerodynamic testing burden based on further assessment of the EPA 
aerodynamic data and comments received on the NPRM. Finally, the 
agencies are adopting aerodynamic test procedure and data analysis 
changes from the Phase 2 proposal to further reduce the variability of 
aerodynamic test results. Detailed discussion of the aerodynamic test 
procedures is included in Section III.E.2.
    Another key change to the final rule is the adoption of more 
stringent particulate matter (PM) standards for auxiliary power units 
(APU) installed in new tractors.\205\ In the Phase 2 NPRM, EPA sought 
comment on the need for and feasibility of new PM standards for these 
engines because APUs can be used in lieu of operating the main engine 
during extended idle operations to provide climate control and power to 
the driver. See 80 FR 40213. APUs can reduce fuel consumption, 
NOX, HC, CH4, and CO2 emissions when 
compared to main engine idling.\206\ However, a potential unintended 
consequence of reducing CO2 emissions from combination 
tractors through the use of APUs during extended idle operation is an 
increase in PM emissions. EPA is adopting requirements for APUs 
installed in new tractors to meet lower PM standards starting in 2018, 
with a more stringent PM standard starting in 2024. Please see Section 
III.C.3 for more details.
---------------------------------------------------------------------------

    \205\ This is necessarily an EPA-only provision since it relates 
to control of criteria pollutant emissions from a type of non-road 
engine, not to fuel efficiency.
    \206\ U.S. EPA. Development of Emission Rates for Heavy-Duty 
Vehicles in the Motor Vehicle Emissions Simulator MOVES 2010. EPA-
420-B-12-049. August 2012.
---------------------------------------------------------------------------

    The agencies are also ending some of the interim provisions 
developed in Phase 1 to reflect the maturity of the program and the 
reduced need and justification for some of the Phase 1 flexibilities. 
Further discussions on all of these matters are covered in the 
following sections.

C. Phase 2 Tractor Standards

    EPA is adopting CO2 standards and NHTSA is adopting fuel 
consumption standards for new Class 7 and 8 combination tractors in 
Phase 2 that are more stringent than Phase 1. In addition, EPA is 
continuing the HFC standards for the air conditioning systems that were 
adopted in Phase 1. EPA is also adopting new standards to further 
control emissions of particulate matter (PM) from auxiliary power units 
(APU) installed in new tractors that will prevent an unintended 
consequence of

[[Page 73575]]

increasing PM emissions during long duration idling.
    This section describes these standards in detail.
(1) Final Fuel Consumption and CO2 Standards
    The Phase 2 fuel consumption and CO2 standards for the 
tractor cab are shown below in Table III-1. These standards will 
achieve reductions of up to 25 percent compared to the 2017 model year 
baseline level when fully phased in for the 2027 MY.\207\ The standards 
for Class 7 are described as ``Day Cabs'' because we are not aware of 
any Class 7 sleeper cabs in the market today; however, the agencies 
require any Class 7 tractor, regardless of cab configuration, meet the 
standards described as ``Class 7 Day Cab.''
---------------------------------------------------------------------------

    \207\ Since the HD Phase 1 tractor standards fully phase-in by 
the MY 2017, this is the logical baseline year.
---------------------------------------------------------------------------

    The agencies' analyses, as discussed briefly below and in more 
detail later in this Preamble and in the RIA Chapter 2.4 and 2.8, 
indicate that these standards are the maximum feasible (within the 
meaning of 49 U.S.C. 32902(k)) and are appropriate under each agency's 
respective statutory authorities.

  Table III-1--Phase 2 Heavy-Duty Combination Tractor EPA Emissions Standards (g CO[ihel2]/ton-mile) and NHTSA
                                 Fuel Consumption Standards (gal/1,000 ton-mile)
----------------------------------------------------------------------------------------------------------------
                                                              Day cab               Sleeper cab     Heavy-haul
                                                 ---------------------------------------------------------------
                                                      Class 7         Class 8         Class 8         Class 8
----------------------------------------------------------------------------------------------------------------
                                     2021 Model Year CO2 Grams per Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................           105.5            80.5            72.3            52.4
Mid Roof........................................           113.2            85.4            78.0  ..............
High Roof.......................................           113.5            85.6            75.7  ..............
----------------------------------------------------------------------------------------------------------------
                               2021 Model Year Gallons of Fuel per 1,000 Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................        10.36346         7.90766         7.10216         5.14735
Mid Roof........................................        11.11984         8.38900         7.66208  ..............
High Roof.......................................        11.14931         8.40864         7.43615  ..............
----------------------------------------------------------------------------------------------------------------
                                     2024 Model Year CO2 Grams per Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................            99.8            76.2            68.0            50.2
Mid Roof........................................           107.1            80.9            73.5  ..............
High Roof.......................................           106.6            80.4            70.7  ..............
----------------------------------------------------------------------------------------------------------------
                          2024 Model Year and Later Gallons of Fuel per 1,000 Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         9.80354         7.48527         6.67976         4.93124
Mid Roof........................................        10.52063         7.94695         7.22004  ..............
High Roof.......................................        10.47151         7.89784         6.94499  ..............
----------------------------------------------------------------------------------------------------------------
                                    2027 Model Year CO2 Grams per Ton-Mile a
----------------------------------------------------------------------------------------------------------------
Low Roof........................................            96.2            73.4            64.1            48.3
Mid Roof........................................           103.4            78.0            69.6  ..............
High Roof.......................................           100.0            75.7            64.3  ..............
----------------------------------------------------------------------------------------------------------------
                          2027 Model Year and Later Gallons of Fuel per 1,000 Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         9.44990         7.21022         6.29666         4.74460
Mid Roof........................................        10.15717         7.66208         6.83694  ..............
High Roof.......................................         9.82318         7.43615         6.31631  ..............
----------------------------------------------------------------------------------------------------------------
Note:
 
\a\ The 2027 MY high roof tractor standards include a 0.3 m\2\ reduction in CdA as described in Section
  III.E.2.a.vii.

    As the agencies noted in the Preamble to the proposed standards, 
the HD Phase 2 CO2 and fuel consumption standards are not 
directly comparable to the Phase 1 standards. 80 FR 40212. This is 
because the agencies are adopting several test procedure changes to 
more accurately reflect real world operation. With respect to tractors, 
these changes will result in the following differences. First, the same 
vehicle evaluated using the HD Phase 2 version of GEM will obtain 
higher (i.e. less favorable) CO2 and fuel consumption values 
because the Phase 2 drive cycles include road grade. Road grade, which 
(of course) exists in the real-world, requires the engine to operate at 
higher horsepower levels to maintain speed while climbing a hill. Even 
though the engine saves fuel on a downhill section, the overall impact 
increases CO2 emissions and fuel consumption. The second of 
the key differences between the CO2 and fuel consumption 
values in Phase 1 and Phase 2 is due to changes in the evaluation of 
aerodynamics. Vehicles are exposed to wind when in use which increases 
the drag of the vehicle and in turn increases the power required to 
move the vehicle down the road. To more appropriately reflect the in-
use aerodynamic performance of tractor-

[[Page 73576]]

trailers, the agencies are adopting a wind averaged coefficient of drag 
instead of the no-wind (zero yaw) value used in Phase 1. The final key 
difference between Phase 1 and the Phase 2 program includes a more 
realistic and improved simulation of the transmission in GEM, which 
could increase CO2 and fuel consumption relative to Phase 1.
    The agencies are adopting Phase 2 CO2 emissions and fuel 
consumption standards for the combination tractors that reflect 
reductions that can be achieved through improvements in the tractor's 
powertrain, aerodynamics, tires, and other vehicle systems. The 
agencies have analyzed the feasibility of achieving the CO2 
and fuel consumption standards, and have identified means of achieving 
these standards that are technically feasible in the lead time 
afforded, economically practicable and cost-effective. EPA and NHTSA 
present the estimated costs and benefits of these standards in Section 
III.D.1. In developing these standards for Class 7 and 8 tractors, the 
agencies have evaluated the following:

 The current levels of emissions and fuel consumption
 the types of technologies that could be utilized by tractor 
and engine manufacturers to reduce emissions and fuel consumption from 
tractors and associated engines
 the necessary lead time
 the associated costs for the industry
 fuel savings for the consumer
 the magnitude of the CO2 and fuel savings that may 
be achieved

    The technologies on whose performance the final tractor standards 
are predicated include: improvements in the engine, transmission, 
driveline, aerodynamic design, tire rolling resistance, other 
accessories of the tractor, and extended idle reduction technologies. 
These technologies, and other accessories of the tractor, are described 
in RIA Chapter 2.4 and 2.8. The agencies' evaluation shows that some of 
these technologies are available today, but have very low adoption 
rates on current vehicles, while others will require some lead time for 
development. EPA and NHTSA also present the estimated costs and 
benefits of the Class 7 and 8 combination tractor standards in RIA 
Chapter 2.8 and 2.12, explaining as well the basis for the agencies' 
stringency level.
    As explained below in Section III.D, EPA and NHTSA have determined 
that there will be sufficient lead time to introduce various tractor 
and engine technologies into the fleet starting in the 2021 model year 
and fully phasing in by the 2027 model year. This is consistent with 
NHTSA's statutory requirement to provide four full model years of 
regulatory lead time for standards. As was adopted in Phase 1, the 
agencies are adopting provisions for Phase 2 that allow manufacturers 
to generate and use credits from Class 7 and 8 combination tractors to 
show compliance with the standards. This is discussed further in 
Section III.F.
    Based on our analysis, the 2027 model year standards for 
combination tractors and engines represent up to a 25 percent reduction 
in CO2 emissions and fuel consumption over a 2017 model year 
baseline tractor, as detailed in Section III.D.1. In considering the 
feasibility of vehicles to comply with these standards over their 
useful lives, EPA also considered the potential for CO2 
emissions to increase during the regulatory useful life of the product. 
As we discuss in Phase 1 and separately in the context of deterioration 
factor (DF) testing, we have concluded that CO2 emissions 
are likely to stay the same or actually decrease in-use compared to new 
certified configurations for the projected technologies. In general, 
engine and vehicle friction decreases as products wear, leading to 
reduced parasitic losses and consequent lower CO2 emissions. 
Similarly, tire rolling resistance falls as tires wear due to the 
reduction in tread depth. In the case of aerodynamic components, we 
project no change in performance through the regulatory life of the 
vehicle since there is essentially no change in their physical form as 
vehicles age. Similarly, weight reduction elements such as aluminum 
wheels are not projected to increase in mass through time, and hence, 
we can conclude will not deteriorate with regard to CO2 
emissions performance in-use. Given all of these considerations, the 
agencies are confident in projecting that the tractor standards today 
will be technically feasible throughout the regulatory useful life of 
the program.
(2) Non-CO2 GHG Emission Standards for Tractors
    EPA is also continuing the Phase 1 standards to control non-
CO2 GHG emissions from Class 7 and 8 combination tractors.
(a) N2O and CH4 Emissions
    The final Phase 2 heavy-duty engine standards for both 
N2O and CH4 as well as details of these standards 
are included in the discussion in Section II.D.3 and II.D.4. EPA 
requested comment, but did not receive any comments (or otherwise 
obtain any new information) indicating that there were appropriate 
controls for these non-CO2 GHG emissions for the tractors 
manufacturers. Nor does EPA believe there are any technologies 
available to set vehicle standards. Therefore, EPA is not adopting any 
additional controls for N2O or CH4 emissions 
beyond those in the HD Phase 2 engine standards for the tractor 
category.
(b) HFC Emissions
    Manufacturers can reduce hydrofluorocarbon (HFC) emissions from air 
conditioning (A/C) leakage emissions in two ways. First, they can 
utilize leak-tight A/C system components. Second, manufacturers can 
largely eliminate the global warming impact of leakage emissions by 
adopting systems that use an alternative, low-Global Warming Potential 
(GWP) refrigerant, to replace the commonly used R-134a refrigerant. EPA 
is maintaining the A/C leakage standards adopted in HD Phase 1 (see 40 
CFR 1037.115). EPA believes the Phase 1 use of leak-tight components is 
at an appropriate level of stringency while maintaining the flexibility 
to produce the wide variety of A/C system configurations required in 
the tractor category. Please see Section I.F.(1)(b) for a discussion 
related to alternative refrigerants.
(3) EPA's PM Emission Standards for APUs Installed in New Tractors
    Auxiliary power units (APUs) can be used in lieu of operating the 
main engine during extended idle operations to provide climate control 
and additional hotel power for the driver. As noted above, APUs can 
reduce fuel consumption, NOX, HC, CH4, and 
CO2 emissions by a meaningful amount when compared to main 
engine idling.\208\ However, a potential unintended consequence of 
reducing CO2 emissions from combination tractors through the 
use of APUs during extended idle operation is an increase in diesel PM 
emissions. Engines currently being used to power APUs have been subject 
to the Nonroad Tier 4 p.m. standards (40 CFR 1039.101), which are less 
stringent in this power category than the heavy-duty on-highway 
standards (40 CFR 86.007-11) on a brake-specific basis. In the NPRM, 
EPA sought comment on the need for and appropriateness of further 
reducing PM emissions from APUs used as part of a compliance strategy 
for Phase 2, and suggested the basis for possible new PM

[[Page 73577]]

standards to avoid these unintended consequence. 80 FR 40213.
---------------------------------------------------------------------------

    \208\ U.S. EPA. Development of Emission Rates for Heavy-Duty 
Vehicles in the Motor Vehicle Emissions Simulator MOVES 2010. EPA-
420-B-12-049. August 2012.
---------------------------------------------------------------------------

    After considering the numerous comments submitted on this issue and 
our consideration of feasibility of PM controls, EPA is adopting a new 
PM standard of 0.02 g/kW-hr that applies exclusively to APUs installed 
in MY 2024 and later new tractors. EPA is also amending the Phase 1 GHG 
standards to provide that as of January 1, 2018 and through MY 2020, a 
tractor can receive credit for use of an AESS with an APU installed at 
the factory only if the APU engine is certified under 40 CFR part 1039 
with a deteriorated emission level for PM that is at or below 0.15 g/
kW-hr. For MY 2021 through 2023, this same emission level applies as a 
standard for all new tractors with an APU installed. Starting in MY 
2024, any APU installed in a new tractor must be certified to a PM 
emission standard of 0.02 g/kW-hr over the full useful life as 
specified in 40 CFR 1039.699. Engine manufacturers may alternatively 
meet the APU standard by certifying their engines under 40 CFR part 
1039 with a Family Emission Limit for PM at or below 0.02 g/kW-hr. APUs 
installed on MY 2024 and later tractors must have a label stating that 
the APU meets the PM requirements of 40 CFR 1039.699. Tractor 
manufacturers will be subject to a prohibition against selling new MY 
2024 and later tractors with APUs that are not certified to the 
specified standards, and manufacturers will similarly be subject to a 
prohibition against selling new MY 2021 through 2023 tractors with APUs 
that do not meet the specified emission levels. This applies for both 
new and used APUs installed in such new tractors. Manufacturers of new 
nonroad engines and new APUs may continue to produce and sell their 
products for uses other than installation in new tractors without 
violating these prohibitions. However, nonroad engine manufacturers and 
APU manufacturers would be liable if they are found to have caused a 
tractor manufacturer to violate this prohibition, such as by 
mislabeling an APU as compliant with this standard. Note also that the 
PM standard for APUs applies for new tractors, whether or not the 
engine and APU are new; conversely, the PM standard does not apply for 
APU retrofits on tractors that are no longer new, even if the engine 
and APU are new.

            Table III-2--PM Standards for Tractors Using APUs
------------------------------------------------------------------------
                                      PM emission
            Tractor MY              standard (g/kW-   Expected control
                                          hr)            technology
------------------------------------------------------------------------
MY 2021-2023 \a\..................            0.15  In-cylinder PM
                                                     control.
MY 2024 and later.................            0.02  Diesel Particulate
                                                     Filter.
------------------------------------------------------------------------
Note:
\a\ APUs installed on new tractors built January 1, 2018 and later,
  through model year 2020, must have engines that meet the same 0.15 g/
  kW-hr emission level if they rely on AESS for demonstrating compliance
  with emission standards.

    We discuss below the principal comments we received on whether to 
adopt a standard to control PM emissions from APUs used for tractor 
idle emission control, the basis for the amended standards, and how EPA 
envisions the standards operating in practice.
    Among the comments we received were those from the American Lung 
Association, National Association of Clean Air Agencies, Northeast 
States for Coordinated Air Use Management, Environmental Defense Fund, 
Natural Resources Defense Council, Environmental Law and Policy Center, 
Coalition for Clean Air/California Cleaner Freight Coalition, Moving 
Forward Network, Ozone Transport Commission, and the Center for 
Biological Diversity that urged EPA to amend the standards for PM 
emissions from these engines in order to reduce PM emission increases 
resulting from increased APU use. Bendix commented that EPA should 
consider the full vehicle emissions and fuel consumption, including the 
APU, to create a more accurate comparison when considering alternatives 
to diesel powered APUs. California's ARB supported the development of a 
federal rule that requires DPFs on APUs, similar to the requirements 
already in place in California because diesel PM poses a large public 
health risk.
    In contrast, EMA commented that EPA should not impose any new 
emission requirements on APU engines because they already meet the Tier 
4 nonroad standards and argued further that this rulemaking is not the 
proper forum for amending nonroad engine emission standards. Ingersoll 
Rand commented that they have significant concerns with regard to a 
nationwide requirement for use of DPFs in diesel-powered APUs, and 
strongly urged EPA not to impose such a perceived burden on the 
trucking industry. Ingersoll Rand's concerns are that the additional 
cost would push owners away from diesel-powered APUs to battery-powered 
APUs that, according to Ingersoll Rand, are not yet mature enough to 
serve as a replacement for diesel-powered APUs. Ingersoll Rand believes 
that high-capacity battery-powered APUs will eventually become a 
commercially available and cost-effective alternative to diesel-powered 
APUs. Ingersoll Rand stated that, although Thermo King has been 
dedicating resources to research and development in this area for some 
time, mandating this technology today would significantly decrease 
consumer choice, competitiveness in the APU marketplace, and driver 
comfort and safety. ATA is concerned that efforts to place additional 
emissions controls, and therefore additional costs, on APUs by making 
PM standards more stringent will discourage the use of this fuel 
efficient technology. EPA considered Ingersoll Rand's comments in 
developing a phased-in approach to the new PM standards for new 
tractors using APUs to, having the principal standard apply commencing 
with MY 2024 tractors in order to provide sufficient lead time.
    Following is discussion of our analysis of this issue in light of 
the information we received and of our decision to establish a new PM 
standard for these units.
(a) PM Emissions Impact Without Additional Controls
    EPA conducted an analysis using MOVES, which evaluates the 
potential impact on PM emissions due to an increase in APU adoption 
rates. In this analysis, EPA assumed that PM emission rates from 
current technology APUs would be unchanged in the future. We estimated 
an average in-use APU emission rate of 0.96 grams PM per hour from 
three in-use APUs (model years 2006 and 2011), measured in

[[Page 73578]]

different load conditions.\209\ We determined that a typical 2010 model 
year or newer tractor that uses its main engine to idle emits 0.32 
grams PM per hour, based on a similar analysis of in-use idling of 
emissions from 2010 model year and newer tractors.\12\ Thus, the use of 
an APU would lead to a potential increase in PM of as much as 0.64 
grams per hour.
---------------------------------------------------------------------------

    \209\ U.S. EPA. Updates to MOVES for Emissions Analysis of 
Greenhouse Gas Emissions and Fuel Efficiency Standards for Medium- 
and Heavy-Duty Engines and Vehicles--Phase 2 FRM. Docket Number EPA-
HQ-OAR-2014-0827. July 2016.
---------------------------------------------------------------------------

    The results from these MOVES runs are shown below in Table III-3. 
These results show that an increase in use of APUs could lead to an 
overall increase in PM emissions if no additional PM emission standards 
were put in place. Column three labeled ``Final Phase 2 GHG Program 
PM2.5 Emission Impact without Further PM Control (tons)'' 
shows the incremental increase in PM2.5 without further 
regulation of APU PM2.5 emissions, assuming the rate of APU 
use on which the final CO2 standard is premised. These PM 
emission impacts represent an increase of approximately three percent 
of the HD sector PM emissions. We note further that the pollutant at 
issue is diesel PM, which is associated with myriad serious health 
effects, including premature mortality. See Section VIII.A.6 below.

 Table III-3--Projected Impact of Increased Adoption of APUs in Phase 2
------------------------------------------------------------------------
                                                         Final phase 2
                                                          GHG program
                                       Baseline HD         PM2.5 \a\
                CY                    vehicle PM2.5     emission  impact
                                    emissions  (tons)   without  further
                                                          PM  control
                                                           (tons) \b\
------------------------------------------------------------------------
2040..............................             20,939                464
2050..............................             22,995                534
------------------------------------------------------------------------
Note:
\a\ Positive numbers mean emissions would increase from baseline to
  control case.
\b\ The impacts shown include all PM2.5 impacts from the rule including
  impacts from increased tire wear and brake wear that results from the
  slight increase in VMT projected as a result of this rule.

(b) Feasibility of PM Emission Reductions
    As EPA discussed in the NPRM, there are DPFs in the marketplace 
today that can reduce PM emissions from APUs. 80 FR 40213. Since 
January 1, 2008, California ARB has restricted the idling of sleeper 
cab tractors during periods of sleep and rest.\210\ The regulations 
apply additional requirements to diesel-fueled APUs on tractors 
equipped with 2007 model year or newer main engines. Truck owners in 
California must either: (1) Fit the APU with an ARB verified Level 3 
particulate control device that achieves 85 percent reduction in 
particulate matter; or (2) have the APU exhaust plumbed into the 
vehicle's exhaust system upstream of the particulate matter 
aftertreatment device.\211\ Currently ARB has identified four control 
devices that have been verified to meet the Level 3 p.m. requirements. 
These devices include HUSS Umwelttechnik GmbH's FS-MK Series Diesel 
Particulate filters, Impco Ecotrans Technologies' ClearSky Diesel 
Particulate Filter, Thermo King's Electric Regenerative Diesel 
Particulate Filter, and Proventia's Electronically Heated Diesel 
Particulate Filter. In addition, ARB has approved a Cummins integrated 
diesel-fueled APU and several fuel-fired heaters produced by Espar and 
Webasto.
---------------------------------------------------------------------------

    \210\ California Air Resources Board. Idle Reduction 
Technologies for Sleeper Berth Trucks. Last viewed on September 19, 
2014 at http://www.arb.ca.gov/msprog/cabcomfort/cabcomfort.htm.
    \211\ California Air Resources Board. Sec.  2485(c)(3)(A)(1).
---------------------------------------------------------------------------

    EPA received comments from Daimler, Idle Smart, MECA, and Proventia 
addressing the feasibility of PM reductions from APU engines. Daimler 
stated that they supply APUs that currently meet ARB's PM emission 
requirements and encouraged EPA to simply adopt ARB's regulations. 
Proventia commented that they have produced an ARB-approved actively 
regenerating DPF to fit the Thermo King Tripac APU since 2012 and that 
it is proven, reliable, and commercially available. Idle Smart 
commented that their start-stop idle reduction solution emits less PM 
emissions than a diesel APU without a DPF. MECA commented that a 
particulate filter in this application would be a wall flow device and, 
due to the relatively cold exhaust temperature of these small engines, 
the filters would need to use either all active or a combination of 
passive and active regeneration to periodically clean the soot from the 
filter. MECA stated that active regeneration could be achieved through 
the use of a fuel burner or electric heather upstream of the filter. 
MECA also stated that ARB's regulations demonstrate that it is feasible 
to control PM from small APU engines and that the technology has been 
available since 2008.
    California's Clean Idle program requires that diesel-powered APUs 
be fitted with a verified DPF. In some cases, limits are put on the PM 
emission level at the engine outlet (upstream of the DPF). For example, 
the ThermoKing APU approval utilizing a Yanmar engine requires that 
engine is certified to a PM level of 0.2 g/kW-hr or less (upstream of 
the DPF).\212\ Implementation of the California program and the 
subsequent approval of Level 3 verified devices has led to the 
certification of engines utilized in APUs whose PM emissions at the 
engine outlet are well below the 0.4 g/kW-hr nonroad Tier 4 final 
standard for this size engine in 40 CFR part 1039. For example, the 
Yanmar TK270M engine that is used in combination with ThermoKing's 
electronic regenerative diesel particulate filter, which is certified 
under the EPA designated engine family GYDXL0.57NUA, is certified with 
a PM level of 0.09 g/kW-hr. The addition of a DPF affords at least an 
additional 85 percent reduction from the engine outlet certified value, 
or less than 0.014 g/kW-hr.
---------------------------------------------------------------------------

    \212\ California Air Resources Board. Executive Order DE-12-006. 
Last viewed on June 21, 2016 at http://www.arb.ca.gov/diesel/verdev/pdf/executive_orders/de-12-006.pdf.
---------------------------------------------------------------------------

    EPA believes that these comments confirm our discussion at proposal 
that PM standards reflecting performance of a diesel particulate filter 
are technically feasible.

[[Page 73579]]

(c) Benefits of Further PM Controls
    Using MOVES, EPA evaluated the impact of requiring further PM 
control from APUs nationwide. As shown in Table III-3 and Table III-4, 
EPA projects that the HD Phase 2 program without additional PM controls 
would increase PM2.5 emissions by 464 tons in 2040 and 534 
tons in 2050. The annual impact of the final program to further control 
PM is projected to lead to a reduction of PM2.5 emissions 
nationwide by 927 tons in 2040 and by 1,114 tons in 2050, as shown in 
Table III-4 the column labeled ``Net Impact on National 
PM2.5 Emission with Further PM Control of APUs (tons).'' 
Note that these requirements will reduce PM emissions from APUs assumed 
in the baseline for MY 2018 and later, as well as the additional APUs 
that are projected to be used as a result of the Phase 2 standards. 
This results in projected reductions that exceed the projected increase 
in PM emissions that would have occurred with the new Phase 2 GHG 
standards but without these newly promulgated APU standards.

                     Table III-4--Projected Impact of Further Control on PM2.5 Emissions \a\
----------------------------------------------------------------------------------------------------------------
                                                                                                 Net impact on
                                      Baseline national      HD Phase 2         HD Phase 2       national PM2.5
                                          heavy-duty      program national   program national    emission with
                 CY                     vehicle PM2.5     PM2.5 emissions    PM2.5 emissions       further PM
                                       emissions (tons)   without further    with further PM    control of APUs
                                                         PM control (tons)    control (tons)         (tons)
----------------------------------------------------------------------------------------------------------------
2040................................             20,939             21,403             20,476               -927
2050................................             22,995             23,529             22,416             -1,114
----------------------------------------------------------------------------------------------------------------
Note:
\a\ The impacts shown include all PM2.5 impacts from the rule including impacts from increased tire wear and
  brake wear that results from the slight increase in VMT projected as a result of this rule.

(d) PM Emission Reduction Technology Costs
    EPA does not project any cost for meeting the requirement, 
commencing on January 1, 2018, that tractor manufacturers using APUs as 
part of a compliance path to meeting the Phase 1 GHG standards only 
receive credit in GEM for use of the APU if they use an APU with an 
engine with deteriorated PM emissions at or below 0.15 g/kW-hr. The 
same conclusion applies for MY 2021, when we adopt the PM emission 
level of 0.15 g/kW-hr as an emission standard, not only as a qualifying 
condition for using AESS for demonstrating compliance with the 
CO2 standard. First, EPA projects that the 2018-2023 
requirements can be achieved at zero cost because several engines are 
already meeting them today with in-cylinder controls. Second, this is 
only one of many potential compliance pathways for tractors meeting the 
Phase 1 standards. We nonetheless are providing extra lead time by 
tying this provision to calendar year 2018, rather than model year 
2018, to allow manufacturers time for confirming emission levels and 
otherwise complying with administrative requirements.
    PM emission reductions from APU engines beginning in MY 2024 would 
most likely be achieved through installation of a diesel particulate 
filter (DPF).\213\ In the NPRM, EPA discussed several sources for DPF 
cost estimates. The three sources included the federal Nonroad Diesel 
Tier 4 rule, ARB, and Proventia. EPA developed long-term cost 
projections for catalyzed diesel particulate filters (DPF) as part of 
the Nonroad Diesel Tier 4 rulemaking. In that rulemaking, EPA estimated 
the DPF costs would add $580 to the cost of 150 horsepower engines (69 
FR 39126, June 29, 2004). On the other hand, ARB estimated the cost of 
retrofitting a diesel powered APU with a PM trap to be $2,000 in 
2005.\214\ Proventia is charging customers $2,240 for electronically 
heated DPF for retrofitting existing APUs.\215\
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    \213\ As discussed below, a DPF could be installed by the APU 
manufacturer, the engine manufacturer, the tractor manufacturer, or 
a fourth entity, with certification and labelling responsibilities 
differing depending on which entity does the installation.
    \214\ California Air Resources Board. Staff Report: Initial 
Statement of Reasons; Notice of Public Hearing to Consider 
Requirements to Reduce Idling Emissions From New and In-Use Trucks, 
Beginning in 2008. September 1, 2005. Page 38. Last viewed on 
October 20, 2014 at http://www.arb.ca.gov/regact/hdvidle/isor.pdf.
    \215\ Proventia. Tripac Filter Kits. Last accessed on October 
21, 2014 at http://www.proventiafilters.com/purchase.html.
---------------------------------------------------------------------------

    EPA requested comment on DPF costs in the NPRM and received 
comments from MECA, Proventia, and Ingersoll Rand. MECA agreed with 
EPA's range of DPF costs discussed in the NPRM. Proventia stated that 
the $2,240 end user price cited in the NPRM is for an aftermarket 
retrofit device. Proventia estimated that the direct manufacturing cost 
of materials and manufacturing (which is less than the retail price 
equivalent) for quantities exceeding 10,000 annually would be $975 for 
an actively regenerating device. The basis for this estimate is 
Proventia's current production cost in the quantity of 50 units of 
$1069. Proventia stated that EPA's estimate of $580 for a 150hp engine 
is likely to be for a catalyzed passively regenerating DPF because 
those engines have higher exhaust temperatures. Proventia also stated 
that a cost of an actively regenerating DPF is significantly higher 
than for passively regenerating devices. Ingersoll Rand commented that 
Thermo King currently offers a DPF option on its line of diesel-powered 
APUs and the incremental price of the DPF option can be as high as 
$3,500. ATA commented that adding a DPF to an APU increases the cost of 
the device by up to 20 percent. Daimler provided DPF costs as CBI.
    EPA considered the comments and more closely evaluated NHTSA's 
contracted TetraTech cost report which found the total retail price of 
a diesel-powered APU that includes a DPF to be $10,000.\216\ Based on 
all of this information, EPA is projecting the retail price increment 
of an actively regenerating DPF installed in an APU to be $2,000. This 
cost is incremental to the diesel-powered APU technology costs 
beginning in 2024 MY.
---------------------------------------------------------------------------

    \216\ U.S. DOT/NHTSA. Commercial Medium- and Heavy-Duty Truck 
Fuel Efficiency Technology Cost Study. May 2015. Page 71.
---------------------------------------------------------------------------

    EPA regards these costs as reasonable. First, the PM standard is 
necessary to avoid an unintended consequence of GHG idle control. The 
standard adopted is also appropriate for APUs used in on-highway 
applications, since it is comparable to the heavy-duty on-highway 
standard after considering rounding conventions (the PM standard for a 
tractor's main engine is 0.01 g/hp-hr as specified in 40 CFR 86.007-
11(a)(1)(iv))). The standard is also voluntary in the sense that 
tractor

[[Page 73580]]

manufacturers can use other types of idle reducing technologies, or 
choose a Phase 2 compliance path not involving idle control. The 
agencies have developed technology packages for determining the final 
Phase 2 tractor GHG and fuel consumption standards that are predicated 
on lower penetration rates of diesel APUs than in the NPRM and have 
included several additional idle reducing technologies, making it more 
likely that alternative compliance paths are readily available. APU 
manufacturers (and manufacturers of APU engines) also can market their 
product to any entities other than MY 2024 and later new tractors 
without meeting the DPF-based PM standard. Our review of the costs of 
these standards thus indicates that they will be reasonable.
    It is also worth noting that the reductions also have monetized 
benefits far greater than the costs of the standard. Section IX.H.1 of 
this Preamble discusses the economic value of reductions in criteria 
pollutants. In this analysis, EPA estimates the economic value of the 
human health benefits associated with the resulting reductions in 
PM2.5 exposure using what are known as ``benefit per ton'' 
values. The benefit per ton values estimate the benefits of reducing 
incidence of specific PM2.5-related health impacts, 
including reduction in both premature mortality and premature morbidity 
from on-road mobile sources. The estimate of benefits from reducing one 
ton of direct PM2.5 from on-road mobile sources in 2030 
using a three percent discount rate range is between $490,000 and 
$1,100,000 (2013$) and is between $440,000 and $990,000 (2013$) using a 
seven percent discount rate.\217\ The estimated cost per ton for the 
new APU standards in 2040 is $101,717.
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    \217\ This valuation is undoubtedly conservative because it 
reflects exposure to PM2.5 generally, rather than to the 
form of PM here: Diesel exhaust particulate, a likely human 
carcinogen. See section VIII.A.6.b. Due to underlying analytical 
limitations, PM2.5-related benefit per ton values are 
only estimated out to the year 2030. For the criteria pollutant 
benefits analysis in this rulemaking, we make a conservative 
assumption that 2030 values apply to all emission reductions in 
years that extend beyond 2030. We assume benefit-per-ton values grow 
larger in the future due to income growth and a larger future 
population.
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(e) Other Considerations
    EPA considered the lead time of the new PM standards for APUs 
installed in new tractors. The 2018 provision restricting GEM credit 
for use of APUs is not a new standard, but rather a compliance 
constraint. There should be ample time for tractor manufacturers to 
consider how to obtain APUs certified to the designated deteriorated PM 
emissions level should they wish to receive GEM credit for use of APUs. 
As noted in (d) above, we concluded that the reasonable feasible lead 
time is to implement these provisions on January 1, 2018 because the 
manufacturer's contemplating use of APUs in conjunction with a Phase 1 
compliance strategy using AESS would need time to adapt their 
certification systems, which we believe requires lead time of at least 
several months.
    In MY 2021, tractor manufacturers will be subject to a prohibition 
against selling new MY 2021 through 2023 tractors with APUs that do not 
meet those specified PM emission levels. For the reasons just given, 
there is ample time to meet this requirement.
    The diesel particulate filter-based standard for APUs installed in 
new tractors begins in MY 2024. This allows several years for the 
development and application of diesel particulate filters to these 
APUs. We have concluded that, given the timing of the PM emission 
standards finalized in this document and the availability of the 
technologies, APUs can be designed to meet the new standards with the 
lead time provided (and, again, noting that tractor manufacturers have 
available compliance pathways available not involving APUs).
    In terms of safety, EPA considered the fact that diesel particulate 
filters are a known technology. DPFs have been installed on a subset of 
diesel powered APUs since the beginning of the California requirements 
and have been used with on-highway diesel engines since the sale of MY 
2007 engines. We are unaware of any safety issues with this technology. 
We are adopting these APU requirements because they allow for reduced 
fuel consumption; this also leads to a positive impact with respect to 
energy.
(f) Implementation of the Standard
    EPA has a choice as to whether to adopt these provisions as a 
tractor vehicle standard or as a standard for the non-road engine in 
the APU. Under either approach, EPA is required to consider issues of 
technical feasibility, cost, safety, energy, and lead time. EPA has 
addressed all of these factors above, and finds the 2018, 2021, and 
2024 provisions, and associated lead time, to be justified.\218\
---------------------------------------------------------------------------

    \218\ As noted above, the 2018 provision is a compliance 
constraint, not a standard.
---------------------------------------------------------------------------

    The final rule applies most directly to tractor manufacturers. 
However, other entities potentially affected are the manufacturer of 
the APU, the manufacturer of the engine installed in the APU, and a 
different entity (if any) separately installing a DPF on the APU 
engine. At present, all engines used in APUs must certify to the PM 
standard in 40 CFR 1039.101, and must label the engine accordingly (see 
40 CFR 1039.135). The provisions we are adopting for MY 2024 require 
that any APU engine being certified to the 0.02 g/kW-hr PM standard 
have a label indicating that the APU or engine is so certified. This 
puts any entity receiving that engine on notice that the APU (and its 
engine) can be used in a new tractor. Conversely, the absence of such a 
label indicates that the engine cannot be so used. Consequently, if a 
tractor manufacturer receives an APU without the supplemental label, it 
can only use the APU in a new tractor if it installs a DPF or otherwise 
retrofits the APU engine to meet the PM standard.
    The APU certification provisions in 40 CFR 1039.699 are simplified 
to account for the fact that the APU manufacturer would generally be 
adding emission control hardware without modifying the engine from its 
certified configuration. Note that engine manufacturers, tractor 
manufacturers or others installing the emission control hardware may 
also certify to the 0.02 g/kW-hr standard. Since the prohibition 
applies to the tractor manufacturer, we would not expect the delegated 
assembly provisions of 40 CFR 1037.621 or the secondary vehicle 
manufacturer provisions of 40 CFR 1037.622 to apply for APU 
manufacturers.
    As described above, we are aware that the PM standards as adopted 
would not prevent a situation in which tractors are retrofitted with 
diesel APUs after they are no longer new, without meeting the PM 
standards described above. We believe that vehicle manufacturers will 
strongly desire to apply the benefit of AESS with low-PM diesel APUs to 
help them meet CO2 standards for any installations where a 
diesel APU is a viable or likely option for in-use tractors. We will 
consider addressing this possible gap in the program with a standard 
for new APUs installed on new or used tractors. Such a standard would 
be issued exclusively under our authority to regulate nonroad engines 
as described in Clean Air Act section 213 (a)(4). If we adopt such a 
standard, we will also consider whether to adopt that same requirement 
for new APUs installed in other motor vehicles, and for other nonroad 
installations generally.

[[Page 73581]]

(4) Special Purpose Tractors and Heavy-Haul Tractors
    The agencies proposed and are adopting provisions in Phase 2 to set 
standards for a new subcategory of heavy-haul tractors. In addition and 
as noted above, in Phase 1 the agencies adopted provisions to allow 
tractor manufacturers to reclassify certain tractors as vocational 
vehicles, also called Special Purpose Tractors.\219\ The agencies 
proposed and are adopting provisions in Phase 2 to continue to allow 
manufacturers to exclude certain vocational-types of tractors (Special 
Purpose Tractors) from the combination tractor standards and instead be 
subject to the vocational vehicle standards. However, the agencies are 
making changes to the proposed Phase 2 Special Purpose Tractors and 
heavy-haul tractors in response to comments, as discussed below.
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    \219\ See 40 CFR 1037.630.
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(a) Heavy-Haul Tractors
    For Phase 2, the agencies proposed and are adopting an additional 
subcategory to the tractor category for heavy-haul tractors that are 
designed to haul much heavier loads than conventional tractors. The 
agencies recognize the need for manufacturers to build these types of 
vehicles for specific applications and also recognize that such heavy-
haul tractors are not fully represented by the way GEM simulates 
conventional tractors. We believe the appropriate way to prevent 
effectively penalizing these vehicles is to set separate standards 
recognizing a heavy-haul vehicle's unique needs, which include the need 
for a higher horsepower engine and different transmissions. In addition 
drivetrain technologies such as 6x2 axles, may not be capable of 
handling the heavier loads. The agencies are adopting this change in 
Phase 2 because, unlike in Phase 1, the engine, transmission, and 
drivetrain technologies are included in the technology packages used to 
determine the stringency of the tractor standards and are included as 
manufacturer inputs in GEM. The agencies also recognize that certain 
technologies used to determine the stringency of the Phase 2 tractor 
standards are less applicable to the heavy-haul tractors designed for 
the U.S. market. For example, heavy-haul tractors in the U.S. are not 
typically used in the same manner as long-haul tractors with extended 
highway driving, and therefore will experience less benefit from 
aerodynamics. This means that the agencies are adopting a standard that 
reflects individualized performance of these technologies in particular 
applications, in this case, heavy-haul tractors, and further, have a 
means of reliably assessing individualized performance of these 
technologies at certification.
    The typical tractor is designed in the U.S. with a Gross Combined 
Weight Rating (GCWR) of approximately 80,000 pounds due to the 
effective weight limit on the federal highway system, except in states 
with preexisting higher weight limits. The agencies proposed in Phase 2 
to consider tractors with a GCWR over 120,000 pounds as heavy-haul 
tractors. Based on comments received during the development of HD Phase 
1 (76 FR 57136-57138) and because we did not propose in Phase 2 a sales 
limit for heavy-haul as we have for the vocational tractors in Phase 1, 
the agencies also believed it would be appropriate to further define 
the heavy-haul vehicle characteristics to differentiate these vehicles 
from the vehicles in the other nine tractor subcategories. The two 
additional requirements in the Phase 2 proposal included a total gear 
reduction greater than or equal to 57:1 and a frame Resisting Bending 
Moment (RBM) greater than or equal to 2,000,000 in-lbs per rail or rail 
and liner combination. Heavy-haul tractors typically require the large 
gear reduction to provide the torque necessary to start the vehicle 
moving. These vehicles also typically require frame rails with extra 
strength to ensure the ability to haul heavy loads. We requested 
comment on the proposed heavy-haul tractor specifications, including 
whether Gross Vehicle Weight Rating (GVWR) or Gross Axle Weight Rating 
(GAWR) would be a more appropriate metric to differentiate between a 
heavy-haul tractor and a typical tractor.
    We received comments from several manufacturers about the proposed 
heavy-haul subcategory. None of the commenters were averse to creating 
such a subcategory, and many manufacturers directly supported such an 
action. Navistar supported creating a new heavy-haul subcategory 
maintaining that this type of vehicle is specified uniquely and is not 
designed for standard trailers. Volvo supported this addition since 
heavy-haul tractors require large engines and increased cooling 
capacity and most heavy-haul rigs have some requirement for off-road 
access to pick up machinery, bulk goods, and unusual loads.
    We received comments from several manufacturers about the criteria 
proposed to define the heavy-haul tractor subcategory. Allison 
commented that for heavy-haul tractors equipped with an automatic 
transmission, the gear reduction ratio should be greater than or equal 
to 24.9:1 because an automatic transmission with a torque converter 
provides a torque multiplying effect and better launch capability. EMA 
and other manufacturers commented that the proposed specifications for 
heavy-haul tractors do not allow the relevant vehicles to meet the 
proposed total gear reduction ratio of 57:1 or greater. EMA commented 
that the Allison 7-speed 4700 transmission and the Eaton 9LL products 
both are specifically designed for heavy-haul operations, could meet a 
53:1 specification, but not a 57:1 ratio. PACCAR also commented that an 
automatic transmission torque converter ratio should be included in the 
Total Reduction ratio calculation to properly incorporate the slip and 
first gear ratio combination that is inherent in an automatic 
transmission. EMA, PACCAR, and Volvo recommended that the agencies 
should change the rear axle ratio for the baseline vehicle to attain 
the 53:1 total reduction ratio because the proposed baseline heavy-haul 
vehicle did not meet the proposed total reduction ratio. Daimler 
commented that the agencies should remove both the frame resistance 
bending moment requirement and the gear reduction requirement.
    EMA and some of the manufacturers commented that the agencies 
should revise the definition of heavy-haul tractor to be ``equal to or 
greater than 120,000 pounds GCWR'' rather than ``greater than 120,000 
pounds GCWR.'' They stated that the specifications for the heavy-haul 
market start with and include 120,000 pounds GCWR. Daimler suggested 
that the minimum GCWR be set at 105,000 pounds to better catch the 
large number of Canadian vehicles that are heavy-haul. Daimler stated 
that this broader weight definition catches a very small number of US 
vehicles (0.1 to 0.9 percent of the vehicles, depending on other 
factors) but catches the large number of Canadian vehicles that Daimler 
considers to be heavy-haul.
    Volvo commented that there are multiple types of heavy-haul 
tractors, each with their own specific characteristics based on 
operational considerations: High-roof highway sleeper tractors pulling 
box vans at or above 120,000 pounds GCWR (e.g. long combination 
vehicles) that run regional and long-haul operations and can benefit 
from the same technologies as high-roof sleepers with 80,000 pound GCWR 
and should be credited for the higher payload; low- and mid-roof 
sleepers that primarily run long-haul routes (e.g. pulling low-boy 
trailers and

[[Page 73582]]

heavy equipment); low-roof day cab tractors running regional and 
shorter routes (e.g. bulk haul); and then what the industry typically 
refers to as heavy-haul that are extremely high GCWR and can haul above 
300 metric tons and sometimes run in multiple tractor configurations 
that provide for one or more tractor(s) pulling and one or more 
tractor(s) pushing.
    In part to follow up on the comments made by manufacturers, EPA 
held discussions with Environment and Climate Change Canada (ECCC) 
after the NPRM was released regarding the Special Purpose tractors and 
heavy-haul tractors.\220\ In our discussions, ECCC emphasized that the 
highway weight limitations in Canada are much greater than those in the 
U.S. Where the U.S. federal highways have limits of 80,000 pounds GCW, 
Canadian provinces have weight limits up to 140,000 pounds. This 
difference could potentially limit emission reductions that could be 
achieved if ECCC were to fully harmonize with the U.S.'s HD Phase 2 
standards because a significant portion of the tractors sold in Canada 
have GCWR greater than 120,000 pounds, the proposed limit for heavy-
haul tractors.
---------------------------------------------------------------------------

    \220\ Memo to Docket. Heavy Class 8 Discussion with Environment 
and Climate Change Canada. July 2016. Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    For the FRM, EPA and NHTSA are revising the heavy-haul tractor 
provisions to balance the certainty that vehicles are regulated in an 
appropriate subcategory along with the potential to better harmonize 
the U.S. and Canadian regulations. Based on our assessment, the 
tractors with GCWR greater than or equal to 120,000 pounds truly 
represent heavy-haul applications in the U.S. Therefore, we are 
adopting criteria only based on GCWR, not the proposed RBM or total 
gear reduction ratios. The agencies are adopting Phase 2 heavy-haul 
standards for this subset of vehicles, similar to the standards 
proposed for Phase 2 and detailed below in Section III.D.1.
    In Canada, due to their differences in weight and dimension 
requirements, it is primarily tractors with a GCWR of equal to or 
greater than 140,000 pounds that are truly heavy-haul vehicles. This 
leaves a set of tractors sold in Canada with a GCWR between 120,000 and 
140,000 pounds that are used in ways that are similar to the way 
tractors with a GCWR less than 120,000 pounds (the typical Class 8 
tractor) are used in the U.S. These tractors sold in Canada could 
benefit from the deployment of additional GHG-reducing technologies 
beyond what is being required for heavy-haul tractors in the U.S., such 
as aerodynamic and idle reduction improvements. Most manufacturers tend 
to rely on U.S. certificates as their evidence of conformity for 
products sold into Canada to reduce compliance burden. Therefore, in 
Phase 2 the agencies are adopting provisions that allow the 
manufacturers the option to meet standards that reflect the appropriate 
technology improvements, along with the powertrain requirements that go 
along with higher GCWR. While these heavy Class 8 tractor standards 
will be optional for tractors sold into the U.S. market, we expect that 
Canada will consider adopting these as mandatory requirements as part 
of their regulatory development and consultation process. Given the 
unique circumstances in the Canadian fleet, we believe that there is a 
reasonable basis for considering such an approach for Canadian 
tractors. As such, the agencies have coordinated these requirements 
with ECCC. The agencies are only adopting optional heavy Class 8 
standards for MY 2021 at this time. The expectation is that ECCC will 
develop their own heavy-duty GHG regulations to harmonize with this 
Phase 2 rulemaking through its own domestic regulatory process. We 
expect that ECCC will include a mandate that heavy Class 8 tractors be 
certified to the MY 2021 heavy Class 8 tractor standards, but could 
also specify more stringent standards for later years for these 
vehicles. We plan to coordinate with ECCC to incorporate any needed 
future changes in a timely manner. Details of these optional standards 
are included in Section III.D.1.
(b) Special Purpose Tractors
    During the development of Phase 1, the agencies received comments 
from several stakeholders supporting an approach for an alternative 
treatment of a subset of tractors because they were designed to operate 
at lower speeds, in stop and go traffic, and sometimes operate off-road 
or at higher weights than the typical line-haul tractor. These types of 
applications have limited potential for improvements in aerodynamic 
performance to reduce CO2 emissions and fuel consumption. 
Therefore, we adopted provisions to allow these special purpose 
tractors to certify as vocational vehicles (or vocational tractors). 
Consistent with our approach in Phase 1, the agencies still believe 
that these vocational tractors are operated differently than line-haul 
tractors and therefore fit more appropriately into the vocational 
vehicle category. However, we need to continue to ensure that only 
tractors that are truly vocational tractors are classified as 
such.\221\ As adopted in Phase 1, a Phase 2 vehicle determined by the 
manufacturer to be a HHD vocational tractor will fall into one of the 
HHD vocational vehicle subcategories and be regulated as a vocational 
vehicle. Similarly, MHD tractors which the manufacturer chooses to 
reclassify as vocational tractors will be regulated as MHD vocational 
vehicles. Specifically, the agencies adopted in Phase 1 provisions in 
EPA's 40 CFR 1037.630 and NHTSA's regulation at 49 CFR 523.2 to only 
allow the following three types of vocational tractors to be eligible 
for reclassification by the manufacturer: Low-roof tractors intended 
for intra-city pickup and delivery, such as those that deliver bottled 
beverages to retail stores; tractors intended for off-road operation 
(including mixed service operation), such as those with reinforced 
frames and increased ground clearance; and tractors with a GCWR over 
120,000 pounds.\222\
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    \221\ As a part of the end of the year compliance process, EPA 
and NHTSA verify manufacturer's production reports to avoid any 
abuse of the vocational tractor allowance.
    \222\ See existing 40 CFR 1037.630 (a)(1)(i) through (iii).
---------------------------------------------------------------------------

    In the Phase 2 proposal, the agencies proposed to remove the third 
type of vocational tractors, heavy-haul tractors with a GCWR over 
120,000 pounds, from the Phase 2 Special Purpose Tractor category and 
set unique standard for heavy-haul tractors. 80 FR 40214. The agencies 
requested comment on the Special Purpose Tractor criteria and received 
comments from the manufacturers. EMA and PACCAR commented there is a 
group of special purpose tractors with a gross combination weight 
rating over 120,000 pounds that fall in between the proposed regulatory 
categories for heavy-haul tractors and Class 8 tractors that need to be 
accounted for in a separate and distinct manner. They stated that such 
vehicles are still appropriately categorized as Special Purpose 
Tractors and should be included at the manufacturer's option in the 
vocational tractor family, even though they may not meet the proposed 
total gear reduction requirement or the frame rail requirements. PACCAR 
and Volvo also requested a modification to the definition to include 
``equal to 120,000 GCWR.''
    Volvo provided a list of recommended Special Purpose Tractor 
criteria. Volvo stated that these characteristics differentiate these 
vehicles from line haul operation, especially in terms of fuel economy 
as well as the significant added costs for these features. Volvo's

[[Page 73583]]

recommended criteria included GCWR greater than 120,000 pounds or any 
three of the following vehicles specifications: Configuration other 
than 4x2, 6x2, or 6x4; greater than 14,600 pounds front axle load 
rating; greater than 46,000 pounds rear axle load rating; greater than 
or equal to 3.00:1 overall axle reduction in transmission high range; 
greater than 57.00:1 overall axle reduction in transmission low range; 
frame rails with a resistance bending moment greater than or equal to 
2,000,000 in-lbs., greater than or equal to 20 degree approach angle; 
or greater than or equal to 14 inch ground clearance.
    The heavy-haul tractor standards that the agencies are adopting in 
Phase 2 apply to tractors with a GCWR greater than or equal to 120,000 
pounds. As stated above, the agencies are adopting heavy-haul tractor 
criteria based only on GCWR, and are not adopting the proposed criteria 
of RBM or total gear reduction. With these Phase 2 changes to the 
proposed heavy-haul tractor definition, all tractors that would have 
been considered as Special Purpose Tractors in Phase 1 due to the GCWR 
criteria listed in EPA's 40 CFR 1037.630 and NHTSA's regulation at 49 
CFR 523.2 will now qualify as heavy-haul tractors in Phase 2. 
Therefore, we no longer believe that it is necessary for heavy-haul 
tractors to be treated as Special Purpose Tractors. The agencies also 
reviewed Volvo's suggested criteria and concluded that the Phase 1 
approach and Special Purpose Tractor criteria are working well; 
therefore, we do not see the need to adopt more restrictive criteria. 
Consequently, the agencies are adopting in Phase 2 provisions in EPA's 
40 CFR 1037.630 and NHTSA's regulation at 49 CFR 523.2 to only allow 
the following two types of vocational tractors to be eligible for 
reclassification to Special Purpose Tractors by the manufacturer:
    (1) Low-roof tractors intended for intra-city pickup and delivery, 
such as those that deliver bottled beverages to retail stores.
    (2) Tractors intended for off-road operation (including mixed 
service operation), such as those with reinforced frames and increased 
ground clearance.
    These provisions apply only for purposes of Phase 2. The agencies 
are not amending the Phase 1 provisions for special purposes tractors.
    Volvo also requested that the agencies add a Vocational Heavy-Haul 
Tractor subcategory that allows for a heavy-haul tractor which benefits 
from the utilization of a powertrain optimized to meet the vocational 
operational requirements of this segment, a technology package 
corresponding to those operational characteristics, and with a 
corresponding duty cycle and, most importantly, a payload 
representative of heavy-haul operation. The agencies considered this 
request and analyzed the expected technology package differences 
between the vocational and tractor program. As described in Section 
III.D.1, the agencies are only adopting technologies in the heavy-haul 
tractor category that would be applicable to the operation of these 
vehicles. For example, we are not adopting standards that are premised 
on any improvements to aerodynamics or extended idle reduction. 
Therefore, we concluded that there is no need to develop another 
vocational subcategory to account for heavy-haul tractors.
    Because the difference between some vocational tractors and line-
haul tractors is potentially somewhat subjective, and because of 
concerns about relative stringency, we also adopted in Phase 1 and 
proposed to continue in Phase 2 a rolling three year sales limit of 
21,000 vocational tractors per manufacturer consistent with past 
production volumes of such vehicles to limit the use of this provision. 
We proposed in Phase 2 to carry-over the existing three year sales 
limit with the recognition that heavy-haul tractors would no longer be 
permitted to be treated as vocational vehicles (suggesting a lower 
volume cap could be appropriate) but that the heavy-duty market has 
improved since the development of the HD Phase 1 rule (suggesting the 
need for a higher sales cap). The agencies requested comment on whether 
the proposed sales volume limit is set at an appropriate level looking 
into the future. 80 FR 40214.
    Several of the manufacturers commented that it would be reasonable 
to remove the sales cap limit. Allison stated that this limitation may 
have been reasonable in the initial years of the program as a 
precaution against unreasonably assigning too many tractors to the 
vocational vehicle category. However in Phase 2, Allison recommended 
that the agencies should remove the cap for three reasons: (1) Vehicle 
configurations change over time; (2) the Phase 2 vocational program 
drives technology improvements of powertrains; and (3) Phase 2 better 
represents the diversity of vocational vehicle uses that would allow 
for better alignment of vehicles with duty cycles that most represent 
their real world operation. Daimler stated that they think that with 
the addition of heavy-haul tractor standards, there will be less need 
for a sales volume limit on special purpose tractors. In Volvo Group's 
opinion, the proposed volume limit is overly constraining and 
burdensome and should be removed. Volvo stated that given the recent 
product lineup overhauls across the industry they do not believe that 
there are many models still on the market that are sold in large 
numbers into both highway tractor and vocational tractor segments, nor 
is there sufficient reason that any OEM cannot identify specific 
vehicle attributes in order to classify a tractor as suitable solely 
for highway use, or for on/off-road use. Volvo Group suggested that the 
agencies remove the vocational tractor volume restrictions and employ a 
guideline based on specific vehicle characteristics.
    The agencies evaluated the sales cap limit proposed for special 
purpose tractors and the comments addressing the issue of a sales cap. 
EPA calculated the number of vocational tractors certified in MY 2014 
and MY 2015. The number of tractors ranged between approximately 2,600 
and 6,200 per year per manufacturer that certified special purpose 
tractors, but one manufacturer did not use this provision at all.\223\ 
It is apparent that none of the manufacturers are utilizing this 
provision near the maximum allowable level in Phase 1 (a rolling three 
year sales limit of 21,000). We also believe that there is more 
incentive for manufacturers to use the special purpose tractor 
provisions in Phase 1 because the relative difference in stringency 
between the tractor and vocational programs is much greater in Phase 1 
than it will be in Phase 2. Upon further consideration, we concluded 
that there is significantly less incentive for the manufacturers to 
reclassify tractors that are not truly special purpose tractors as 
vocational vehicles as a pathway to a less stringent standard in Phase 
2 primarily since the Phase 2 vocational vehicle program stringency is 
similar to the stringency of the tractor program. In addition, the 
Phase 2 vocational vehicle compliance program and standards better 
represent the duty cycles expected of these vehicles and are predicated 
on performance of similar sets of vehicle technologies, except for 
aerodynamic technologies, as the primary tractor program. Therefore, we 
are adopting Phase 2 special purpose tractor provisions without a sales 
cap, but will continue to monitor during the Phase 2 implementation.
---------------------------------------------------------------------------

    \223\ U.S. EPA. Memo to Docket: Special Purpose Tractor 
Production Volumes. Docket EPA-HQ-OAR-2014-0827.

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

[[Page 73584]]

(5) Small Tractor Manufacturer Provisions
    In Phase 1, EPA determined that manufacturers that met the small 
business criteria specified in 13 CFR 121.201 for ``Heavy Duty Truck 
Manufacturing'' should not be subject to the initial phase of 
greenhouse gas emissions standards in 40 CFR 1037.106.\224\ The 
regulations required that qualifying manufacturers notify the 
Designated Compliance Officer each model year before introducing the 
exempted vehicles into commerce. The manufacturers are also required to 
label the vehicles to identify them as excluded vehicles. EPA and NHTSA 
proposed to eliminate this small business provision for tractor 
manufacturers in the Phase 2 program. As stated in the NPRM, the 
agencies are aware of two second stage manufacturers building custom 
sleeper cab tractors. In the proposal we stated that we could treat 
these vehicles in one of two ways. First, the vehicles may be 
considered as dromedary vehicles and therefore treated as vocational 
vehicles.\225\ Or the agencies could provide provisions that stated if 
a manufacturer changed the cab, but not the frontal area of the 
vehicle, then it could retain the aerodynamic bin of the original 
tractor. 80 FR 40214.
---------------------------------------------------------------------------

    \224\ See 40 CFR 1037.150(c).
    \225\ A dromedary is a box, deck, or plate mounted behind the 
tractor cab and forward of the fifth wheel on the frame of the power 
unit of a tractor-trailer combination to carry freight.
---------------------------------------------------------------------------

    The agencies received comments on the second stage manufacturer 
options for small manufacturers discussed in the proposal. American 
Reliance Industries (ARI) raised concerns related to the proposed 
alternative methods for excluding or exempting second stage 
manufacturers performing cab sleeper modifications. ARI is concerned 
that treating these vehicles as vocational vehicles may mean that other 
regulations related to vocational vehicles would become applicable and 
have unanticipated adverse results and that the vehicles would not be 
certified as vocational vehicles when originally certified by an OEM. 
ARI commented that if EPA and NHTSA adopt a frontal area approach for 
second stage manufacturers making cab sleeper modifications, that the 
section be revised to ensure greater clarity as to the intention and 
effect of this section. In building a custom sleeper cab, ARI stated 
that they may use wind fairings, fuel tank fairings, roof fairings, and 
side extenders that can modify the frontal area of the tractor in 
height and width as compared to the frontal area of the vehicle used to 
obtain the original certification. ARI also commented that depending on 
the custom cab sleeper modification, ARI may replace an aerodynamic 
fairing from the tractor in order to provide better aerodynamic results 
in light of the cab sleeper modification. ARI does not want to be 
precluded from continuing to provide these benefits to clients. ARI 
encourages the agencies to take a similar approach to small business 
exemption under the Phase 1 regulation in the Phase 2 regulation.
    Daimler commented on the agencies' two proposed approaches for 
second stage manufacturers that build custom sleepers. Daimler's main 
concern is to clarify that where the primary manufacturer has certified 
a vehicle as a day cab, the second stage manufacturer's actions do not 
draw the primary manufacturer into noncompliance. Daimler stated that 
in many cases, they do not know that a vehicle will be altered by a 
second stage manufacturer. Daimler did not have a preference on the way 
that the agencies proposed to regulate these secondary vehicle 
manufacturers, as long as the primary vehicle manufacturers could 
continue to sell vehicles with the expectation that anyone changing 
them from the compliant state in which it was built would certify those 
changes.
    In response to these comments, EPA is clarifying in 40 CFR 1037.622 
that small businesses may modify tractors as long as they do not modify 
the front of the vehicle and so long as the sleeper compartment is no 
more than 102 inches wide or 162 inches in height. As an interim 
provision, to allow for a better transition to Phase 2, EPA is 
finalizing a more flexible compliance path in 40 CFR 1037.150(r). This 
option allows small manufacturers to convert a low or mid roof tractor 
to a high roof configuration without recertification, provided it is 
for the purpose of building a custom sleeper tractor or for conversion 
to a natural gas tractor. Although this more flexible allowance to 
convert low and mid roof tractors to high roof tractors is being 
adopted as an interim provision, we have not established an end date at 
this time. We expect to reevaluate as manufacturers begin to make use 
of and may decide to revise it in the future, potentially deciding to 
make it a permanent allowance. To be eligible for this option, the 
secondary manufacturer must be a small manufacturer and the original 
low or mid roof tractor must be covered by a valid certificate of 
conformity. The modifications may not increase the frontal area of the 
tractor beyond the frontal area of the equivalent high roof tractor 
paired with a standard box van. With respect to Daimler's comment, 40 
CFR 1037.130 only applies to vehicles sold in an uncertified condition 
and does not apply to vehicles sold in a certified condition.
(6) Glider Vehicles
    As described in Section XIII.B, EPA is adopting new provisions 
related to glider vehicles, including glider tractors.\226\ NHTSA did 
not propose such changes. Glider vehicles and glider kits were also 
treated differently under NHTSA and EPA regulations prior to this 
rulemaking. They are exempt from NHTSA's Phase 1 fuel consumption 
standards. For EPA purposes, the CO2 provisions of Phase 1 
exempted glider vehicles and glider kits produced by small businesses 
but did not include such a blanket exemption for other glider kits. 
Thus, some gliders and glider kits are already subject to the Phase 1 
requirement to obtain a vehicle certificate prior to introduction into 
commerce as a new vehicle. 80 FR 40528.
---------------------------------------------------------------------------

    \226\ See section I.E. 1 for descriptions of glider vehicles and 
glider kits.
---------------------------------------------------------------------------

    In the NPRM, EPA proposed to revise the provisions applicable to 
glider vehicles so that the engines used in these vehicles would need 
to meet the standards for the year of the new glider vehicle. EPA's 
resolution of issues relating to glider vehicles, including glider 
tractors, and glider kits, is discussed fully in Section XIII.B and RTC 
Section 14.2.
    Similarly, NHTSA considered including glider vehicles under its 
Phase 2 program. After assessing the impact glider vehicles have on the 
tractor segment, NHTSA has elected not to include glider vehicles in 
its Phase 2 program. NHTSA may reconsider fuel efficiency regulations 
for glider vehicles in a future rulemaking.
    As discussed in the NPRM, NHTSA would like to reiterate its safety 
authority over gliders--notably, that it has become increasingly aware 
of potential noncompliance with its regulations applicable to gliders. 
While there are instances in which NHTSA regulations allow gliders to 
use a ``donor VIN'' from a ``donor tractor,'' NHTSA has learned of 
manufacturers that are creating glider vehicles that are new vehicles 
under 49 CFR 571.7(e); however, the manufacturers are not certifying 
them and obtaining a new VIN as required. NHTSA plans to pursue 
enforcement actions as applicable against noncompliant manufacturers. 
In addition to enforcement actions, NHTSA may

[[Page 73585]]

consider amending 49 CFR 571.7(e) and related regulations as necessary. 
NHTSA believes manufacturers may not be using this regulation as 
originally intended.
    We believe that the agencies having different policies for glider 
kits and glider vehicles under the Phase 2 program will not result in 
problematic disharmony between the NHTSA and EPA programs, because of 
the small number of vehicles that will be involved. EPA believes that 
its changes will result in the glider market returning to the pre-2007 
levels, in which fewer than 1,000 glider vehicles will be produced in 
most years. Only non-exempt glider vehicles will be subject to 
different requirements under the NHTSA and EPA regulations. However, we 
believe that this is unlikely to exceed a few hundred vehicles in any 
year, which will be few enough not to result in any meaningful 
disharmony between the two agencies.
(7) Useful Life and Deterioration Factors
    Section 202(a)(1) of the CAA specifies that EPA is to adopt 
emissions standards that are applicable for the useful life of the 
vehicle. The in-use Phase 2 standards that EPA is adopting will apply 
to individual vehicles and engines, just as EPA adopted for Phase 1. 
NHTSA is also adopting the same useful life mileage and years as EPA 
for Phase 2.
    EPA is also not adopting any changes to the existing provisions 
that require that the useful life for tractors with respect to 
CO2 emissions be equal to the respective useful life periods 
for criteria pollutants, as shown below in Table III-5. See 40 CFR 
1037.106(e). EPA does not expect degradation of the technologies 
evaluated for Phase 2 in terms of CO2 emissions, therefore 
we did not adopt any changes to the regulations describing compliance 
with GHG pollutants with regards to deterioration. See 40 CFR 1037.241.

                Table III-5--Tractor Useful Life Periods
------------------------------------------------------------------------
                                                        Years     Miles
------------------------------------------------------------------------
Class 7 Tractors....................................        10   185,000
Class 8 Tractors....................................        10   435,000
------------------------------------------------------------------------

D. Feasibility of the Final Phase 2 Tractor Standards

    This section describes the agencies' technical feasibility and cost 
analysis. Further detail on all of these technologies can be found in 
the RIA Chapter 2.
    Class 7 and 8 tractors are used in combination with trailers to 
transport freight. The variation in the design of these tractors and 
their typical uses drive different technology solutions for each 
regulatory subcategory. As noted above, the agencies are continuing the 
Phase 1 provisions that treat vocational tractors as vocational 
vehicles instead of as combination tractors, as noted in Section 
III.C.4. The focus of this section is on the feasibility of final 
standards for combination tractors including the heavy-haul tractors, 
but not the vocational tractors.
    EPA and NHTSA collected information on the cost and effectiveness 
of fuel consumption and CO2 emission reducing technologies 
from several sources, including new information collected since the 
NPRM was promulgated. The primary sources of pre-proposal information 
were the Southwest Research Institute evaluation of heavy-duty vehicle 
fuel efficiency and costs for NHTSA,\227\ the Department of Energy's 
SuperTruck Program,\228\ 2010 National Academy of Sciences report of 
Technologies and Approaches to Reducing the Fuel Consumption of Medium- 
and Heavy-Duty Vehicles,\229\ TIAX's assessment of technologies to 
support the NAS panel report,\230\ the analysis conducted by the 
Northeast States Center for a Clean Air Future, International Council 
on Clean Transportation, Southwest Research Institute and TIAX for 
reducing fuel consumption of heavy-duty long haul combination tractors 
(the NESCCAF/ICCT study),\231\ and the technology cost analysis 
conducted by ICF for EPA.\232\ Some additional information and data 
were also provided in comments.
---------------------------------------------------------------------------

    \227\ Reinhart, T.E. (June 2015). Commercial Medium- and Heavy-
Duty Truck Fuel Efficiency Technology Study--Report #1. (Report No. 
DOT HS 812 146). Washington, DC: National Highway Traffic Safety 
Administration.
    \228\ U.S. Department of Energy. SuperTruck Initiative. 
Information available at http://energy.gov/eere/vehicles/vehicle-technologies-office.
    \229\ Committee to Assess Fuel Economy Technologies for Medium- 
and Heavy-Duty Vehicles; National Research Council; Transportation 
Research Board (2010). Technologies and Approaches to Reducing the 
Fuel Consumption of Medium- and Heavy-Duty Vehicles. (``The 2010 NAS 
Report'') Washington, DC, The National Academies Press.
    \230\ TIAX, LLC. ``Assessment of Fuel Economy Technologies for 
Medium- and Heavy-Duty Vehicles,'' Final Report to National Academy 
of Sciences, November 19, 2009.
    \231\ NESCCAF, ICCT, Southwest Research Institute, and TIAX. 
Reducing Heavy-Duty Long Haul Combination Truck Fuel Consumption and 
CO2 Emissions. October 2009.
    \232\ ICF International. ``Investigation of Costs for Strategies 
to Reduce Greenhouse Gas Emissions for Heavy-Duty On-Road 
Vehicles.'' July 2010. Docket Number EPA-HQ-OAR-2010-0162-0283.
---------------------------------------------------------------------------

    Commenters generally supported the agencies' projection that 
manufacturers can reduce CO2 emissions and fuel consumption 
of combination tractors through use of many technologies, including 
engine, drivetrain, aerodynamic, tire, extended idle, and weight 
reduction technologies. The agencies' determination of the feasibility 
of the final HD Phase 2 standards is based on our updated projection of 
the use of these technologies and an updated assessment of their 
effectiveness. We will also discuss other technologies that could 
potentially be used, such as vehicle speed limiters, although we are 
not basing the final standards on their use for the model years covered 
by this rule, for various reasons discussed below.
(1) Projected Technology Effectiveness and Cost
    EPA and NHTSA project that CO2 emissions and fuel 
consumption reductions can be feasibly and cost-effectively met through 
technological improvements in several areas. The agencies evaluated 
each technology and estimated the most appropriate adoption rate of 
technology into each tractor subcategory. The next sections describe 
the baseline vehicle configuration, the effectiveness of the individual 
technologies, the costs of the technologies, the projected adoption 
rates of the technologies into the regulatory subcategories, and 
finally the derivation of these standards.
    Based on information available at the time of the NPRM, the 
agencies proposed Phase 2 standards that projected by 2027, all high-
roof tractors would have aerodynamic performance equal to or better 
today's SmartWay performance--which represents the best of today's 
technology. This would equate to having 40 percent of new high roof 
sleeper cabs in 2027 complying with the current best practices and 60 
percent of the new high-roof sleeper cab tractors sold in 2027 having 
better aerodynamic performance than the best tractors available today. 
For tire rolling resistance, we premised the proposed standards on the 
assumption that nearly all tires in 2027 would have rolling resistance 
equal to or superior to tires meeting today's SmartWay designation. At 
proposal, the agencies assumed the 2027 MY engines would achieve an 
additional 4 percent improvement over Phase 1 engines and we projected 
15 percent adoption of waste heat recovery (WHR) and many other 
advanced engine technologies. In addition, we proposed standards that 
projected improvements to nearly all of today's transmissions, 
incorporation of extended idle reduction technologies on 90 percent of 
sleeper cabs, and significant adoption of

[[Page 73586]]

other types of technologies such as predictive cruise control and 
automatic tire inflation systems.
    The agencies also discussed several other alternatives in the 
proposal. When considering alternatives, it is necessary to evaluate 
the impact of a regulation in terms of CO2 emission 
reductions, fuel consumption reductions, and technology costs. However, 
it is also necessary to consider other aspects, such as manufacturers' 
research and development resources, the impact on purchase price, and 
the impact on purchasers. Manufacturers are limited in their ability to 
develop and implement new technologies due to their human resources and 
budget constraints. This has a direct impact on the amount of lead time 
that is required to meet any new standards. From the owner/operator 
perspective, heavy-duty vehicles are a capital investment for firms and 
individuals so large increases in the upfront cost could impact buying 
patterns. Though the dollar value of the lifetime fuel savings will far 
exceed the upfront technology costs, purchasers often discount future 
fuel savings for a number of reasons, as discussed in more detail in 
Section IX.A. Tractor purchasers are often uncertain regarding the 
amount of fuel savings that can be expected for their specific 
operation due to the diversity of the heavy-duty tractor market. 
Although a nationwide perspective that averages out this uncertainty is 
appropriate for rulemaking analysis, individual operators must consider 
their potentially narrow operation. In addition, purchasers often put a 
premium on reliability (because downtime is costly in terms of towing, 
repair, late deliveries, and lost revenue) and may perceive any new 
technology as a potential risk with respect to reliability. Another 
factor that purchasers consider is the impact of a new technology on 
the resale market, which can also be impacted by uncertainty.
    The agencies solicited comment on all of these issues and again 
noted the possibility of adopting, in a final action, standards that 
are more accelerated than those in Alternative 3, notably what we 
termed at proposal, Alternative 4 which would have involved a three 
year pull ahead of the proposed 2027 standards. 80 FR 40211. The 
agencies also assumed in the NPRM that both the proposed standards and 
Alternative 4 could be accomplished with all changes being made during 
manufacturers' normal product design cycles. However, we noted that 
doing so would be more challenging for Alternative 4 and may require 
accelerated research and development outside of design cycles with 
attendant increased costs. Commenters were encouraged in the NPRM to 
address all aspects of feasibility analysis, including costs, the 
likelihood of developing the technology to achieve sufficient 
relaibility within the lead time, and the extent to which the market 
could utilize the technology.
    The agencies received several general comments on the overall 
stringency of the proposed Phase 2 standards. Several entities 
encouraged the agencies to adopt more stringent tractor standards, 
including adoption of Alternative 4. They pointed out that DOE's 
SuperTruck program demonstrated over 40 percent improvement over 2010 
levels, including 10.7 mpg by Cummins-Peterbuilt and 12.2 mpg by 
Daimler. CBD stated that the technology forcing nature of Clean Air Act 
section 202(a)(2) \233\ and EPCA/EISA requires more aggressive 
assumptions regarding technology adoption. UCS commented that the 
tractor standards could be strengthened by another six percent in 2024 
and seven percent in 2027 to reflect the full range of improvements to 
the powertrain and engine. ICCT stated that its analysis indicates that 
the technology potential is higher and costs are lower than the 
agencies' assessments in the NPRM. CARB stated that Alternative 4 is 
technologically feasible and will result in more emission and fuel 
consumption reductions. CARB continued to state that the increased cost 
due to accelerated implementation is minimal, about $1,000 per vehicle 
purportedly according to the NPRM.
---------------------------------------------------------------------------

    \233\ CBD is mistaken that section 202(a)(2) mandates 
technology-forcing standards, although it allows them. See generally 
74 FR 49464-465 (Sept. 28, 2009).
---------------------------------------------------------------------------

    In contrast to the commenters that called for more stringent 
standards than those proposed, several other commenters cautioned the 
agencies from adopting final standards that are more stringent than 
those proposed. Diesel Technology Forum commented that the agencies 
should proceed with caution on technologies that are not in wide use 
that have not demonstrated reliability or commercial availability. The 
International Foodservice Distributors Association is concerned about 
Alternative 4 in terms of reliability, commenting that it would require 
their members to purchase unproven and unreliable equipment in order 
for OEMs to meet the requirements. OOIDA commented if owners fear a 
reduction in reliability, increased operating costs, reduced residual 
value, or large increases in purchase prices, they will adjust their 
purchase plans.
    PACCAR commented about the importance of lead time because their 
customers need time to determine if a technology meets their specific 
needs in their specific application and need assurance that a 
technology will be reliable in use. PACCAR also stated that the timing 
provided in the NPRM Alternative 3 provides the ``greatest likelihood 
for a successful program.'' Volvo commented that SuperTruck 
demonstration vehicles serve only the purpose of demonstration but are 
not proven with respect to cost, reliability, and durability. Volvo 
stated that the purpose of SuperTruck was narrow in applicability of 
matched tractor-trailers and that it did not result in a cost effective 
tractor because each project cost between $40 and $80 million to 
produce a single vehicle. Volvo also commented that not all SuperTruck 
technologies should be forced into all applications and duty cycles and 
if they are a pre-buy (or no-buy) could result.
    The agencies considered all of the general comments associated with 
the proposed Alternative 3 and Alternative 4 tractor standards. We 
believe there is merit in many of the detailed comments received 
regarding technologies. These are discussed in detail in the following 
sections. Instead of merely choosing from among the proposed 
alternatives, the agencies have developed a set of final tractor 
standards that reflect our reevaluation of the ability to pull ahead 
certain technologies, the limitations in adoption rates and/or 
effectiveness of other technologies, and consideration of additional 
technologies. In general, the final Phase 2 tractor standards are 
similar in overall stringency as the levels proposed in Alternative 3, 
but have been determined using new technology packages that reflect 
consideration of all of the technology comments, and in some respects 
reflect greater stringency than the proposed Alternative 3.
    As can be seen from the comments, there is uncertainty and a wide 
range of opinions regarding the extent to which these technologies can 
be applied to heavy-duty tractors. Vehicle manufacturers tended to take 
the conservative position for each technology and argue that the 
agencies should not project effectiveness or adoption rates beyond that 
which is certain. Many other commenters took a more optimistic view and 
argued for the agencies to assume that each potential technology will 
be highly effective in most applications. However the agencies believe 
the most likely outcome will be that some technologies

[[Page 73587]]

will work out better than expected while others will be slightly more 
challenging than projected. Thus, the agencies have tended to make 
balanced projections for the various technologies, although some may be 
slightly optimistic while others are somewhat conservative. We believe 
the overall effect of this approach will be standards that achieve 
large reductions with minimal risks to the industry.
(a) Tractor Baselines for Costs and Effectiveness
    The fuel efficiency and CO2 emissions of combination 
tractors vary depending on the configuration of the tractor. Many 
aspects of the tractor impact its performance, including the engine, 
transmission, drive axle, aerodynamics, and rolling resistance. For 
each subcategory, the agencies selected a theoretical tractor to 
represent the average 2017 model year tractor that meets the Phase 1 
standards (see 76 FR 57212, September 15, 2011). These tractors are 
used as baselines from which to evaluate costs and effectiveness of 
additional technologies and standards.
    As noted earlier, the Phase 1 2017 model year tractor standards 
(based on Phase 1 GEM and test procedures) and the baseline 2017 model 
year tractor results (using Phase 2 GEM and test procedures) are not 
directly comparable. The same set of aerodynamic and tire rolling 
resistance technologies were used in both setting the Phase 1 standards 
and determining the baseline of the Phase 2 tractors. However, there 
are several aspects that differ. First, a new version of GEM was 
developed and validated to provide additional capabilities, including 
more refined modeling of transmissions and engines. Second, the 
determination of the HD Phase 2 CdA value takes into account 
a revised test procedure, a new standard reference trailer, and wind 
averaged drag as discussed below in Section III.E. In addition, the HD 
Phase 2 version of GEM includes road grade in the 55 mph and 65 mph 
highway cycles, as discussed below in Section III.E.
    The agencies used the same adoption rates of tire rolling 
resistance for the Phase 2 baseline as we used to set the Phase 1 2017 
MY standards. See 76 FR 57211. The tire rolling resistance level 
assumed to meet the 2017 MY Phase 1 standard high roof sleeper cab is 
considered to be a weighted average of 10 percent pre-Phase 1 baseline 
rolling resistance, 70 percent Level 1, and 20 percent Level 2. The 
tire rolling resistance to meet the 2017MY Phase 1 standards for the 
high roof day cab, low roof sleeper cab, and mid roof sleeper cab 
includes 30 percent pre-Phase 1 baseline level, 60 percent Level 1 and 
10 percent Level 2. Finally, the low and mid roof day cab 2017 MY 
standards were premised on a weighted average rolling resistance 
consisting of 40 percent baseline, 50 percent Level 1, and 10 percent 
Level 2. The agencies did not receive comments on the tire packages 
used to develop the Phase 2 baseline in the NPRM.
    The agencies sought comment on the baseline vehicle attributes 
described in the NPRM. The agencies received comments related to the 
baseline adoption rate of automatic engine shutdown systems (AESS) and 
the baseline aerodynamics assessment. In the proposal, the agencies 
noted that the manufacturers were not using tamper-proof AESS to comply 
with the Phase 1 standards so the agencies reverted back to the 
baseline APU adoption rate of 30 percent used in the Phase 1 baseline. 
EMA and TRALA commented that the agencies confused the use of an APU 
with the use of tamper-proof idle technologies in assessing the 
baseline for the proposed Phase 2 standards. They stated that a 30 
percent penetration rate of APUs is not the same as a 30 percent 
penetration rate of tamper-proof idle systems. ATA and Volvo also 
commented that the assumption that 30 percent of 2017 sleeper tractors 
will utilize the tamper-proof automatic engine shutdown is too high. 
EMA and PACCAR commented that virtually all tractors in the field have 
an automatic shutdown programmed in their engine; however, less than 
one percent of vehicles sold in recent years have tamper-proof AESS 
that are triggered in less than five minutes and cannot be reprogrammed 
for 1.259 million miles. In response to these comments, the agencies 
reassessed the baseline idle reduction adoption rates. The latest NACFE 
confidence report found that 9 percent of tractors had auxiliary power 
units and 96 percent of vehicles are equipped with adjustable automatic 
engine shutdown systems.\234\ Therefore, the agencies are projecting 
that 9 percent of sleeper cabs will contain an adjustable AESS and APU, 
while the other 87 percent will only have an adjustable AESS. 
Additional discussion on adjustable AESS is included in Section 
III.D.1.b.
---------------------------------------------------------------------------

    \234\ North American Council for Freight Efficiency. Confidence 
Report:Idle Reduction Solutions. 2014. Page 13.
---------------------------------------------------------------------------

    The Phase 2 baseline in the NPRM was determined based on the 
aerodynamic bin adoption rates used to determine the Phase 1 MY 2017 
tractor standards. Volvo, EMA, and other manufacturers also commented 
that the aerodynamic drag baseline for 2017 tractors included in the 
NPRM was too aerodynamically efficient. EMA commented that some of the 
best aerodynamic tractors available were tested by the agencies and 
then declared to be the baseline. According to the manufacturers, the 
average tractor--the true baseline--is a full bin worse than these best 
tractors. While the agencies agree with the commenters that it is 
important to develop an accurate baseline so that the appropriate 
aerodynamic technology package effectiveness and costs can be evaluated 
in determining the final Phase 2 standards, there appears to be some 
confusion regarding the NPRM baseline aerodynamic assessment. The Phase 
2 baseline in the NPRM was determined based on the aerodynamic bin 
adoption rates used to determine the Phase 1 MY 2017 tractor standards 
(see 76 FR 57211). The baseline was not determined by or declared to be 
the average results of the vehicles tested, as some commenters 
maintained. The vehicles that were tested prior to the NPRM were used 
to develop the proposed aerodynamic bin structure for Phase 2. In both 
the NPRM and this final rulemaking, we developed the Phase 2 bins such 
that there is an alignment between the Phase 1 and Phase 2 aerodynamic 
bins after taking into consideration the changes in aerodynamic test 
procedures and reference trailers required in Phase 2. The Phase 2 bins 
were developed so that tractors that performed as a Bin III in Phase 1 
would also perform as Bin III tractors in Phase 2. Additional details 
regarding how the agencies refined the aerodynamic bin values for Phase 
2 for the final rule can be found in Section III.E.2.a. The baseline 
aerodynamic value for the Phase 2 final rulemaking was determined in 
the same manner as the NPRM, using the adoption rates of the bins used 
to determine the Phase 1 standards, but reflect the final Phase 2 bin 
CdA values.
    In the NPRM, we used a transmission top gear ratio of 0.73 and 
drive axle ratio of 3.70 in the baseline 2017 MY tractor. UCS commented 
that the baseline axle ratio is too high. The agencies determined the 
rear axle ratio and final drive ratio in the baseline tractor based on 
axle market information shared by Meritor,\235\ one of the primary 
suppliers of heavy-duty axles, and confidential business information 
provided by Daimler. Our assessment of this information found that a 
rear axle ratio

[[Page 73588]]

of 3.70 and a top gear ratio of 0.73 (equivalent to a final drive ratio 
of 2.70) is a commonly spec'd tractor. Meritor's white paper on 
downspeeding stated that final drive ratios of less than 2.64 are 
considered to be ``downsped.'' \236\ The agencies recognize that there 
is a significant range in final drive ratios that will be utilized by 
tractors built in 2017 MY, we do not believe that the average (i.e., 
baseline) tractor in 2017 MY will downsped (i.e., have a final drive 
ratio of less than 2.64). Therefore, the agencies are maintaining the 
proposed top gear ratio and drive axle ratio for the assessment of the 
baseline tractor performance.
---------------------------------------------------------------------------

    \235\ NACFE. Confidence Report: Programmable Engine Parameters. 
February 2015. Page 23.
    \236\ Ostrander, Robert, et.al. (Meritor). Understanding the 
Effects of Engine Downspeeding on Drivetrain Components. 2014. Page 
2.
---------------------------------------------------------------------------

    The agencies are using the specific attributes of each tractor 
subcategory as are listed below in Table III-6 for the Phase 2 
baselines. Using these values, the agencies assessed the CO2 
emissions and fuel consumption performance of the baseline tractors 
using the Phase 2 GEM. The results of these simulations are shown below 
in Table III-7.

                                             Table III-6--GEM Inputs for the Baseline Class 7 and 8 Tractor
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Class 7                                                                      Class 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Day cab                                            Day cab                                          Sleeper cab
--------------------------------------------------------------------------------------------------------------------------------------------------------
    Low roof          Mid roof        High roof         Low roof         Mid roof        High roof         Low roof         Mid roof        High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
  2017 MY 11L      2017 MY 11L      2017 MY 11L      2017 MY 15L      2017 MY 15L      2017 MY 15L      2017 MY 15L      2017 MY 15L      2017 MY 15L
   Engine 350     Engine 350 HP      Engine 350       Engine 455       Engine 455       Engine 455       Engine 455       Engine 455       Engine 455
           HP                                HP               HP               HP               HP               HP               HP               HP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                Aerodynamics (CdA in m2)
--------------------------------------------------------------------------------------------------------------------------------------------------------
         5.41             6.48             6.38             5.41             6.48             6.38             5.41             6.48             5.90
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Steer Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
         6.99             6.99             6.87             6.99             6.99             6.87             6.87             6.87             6.54
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Drive Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
         7.38             7.38             7.26             7.38             7.38             7.26             7.26             7.26             6.92
--------------------------------------------------------------------------------------------------------------------------------------------------------
                             Extended Idle Reduction--Adjustable AESS with no Idle Red Tech Adoption Rate @1% Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
          N/A              N/A              N/A              N/A              N/A              N/A              87%              87%              87%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                Extended Idle Reduction--Adjustable AESS with Diesel APU Adoption Rate @3% Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
          N/A              N/A              N/A              N/A              N/A              N/A               9%               9%               9%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Transmission = 10 Speed Manual Transmission
                                        Gear Ratios = 12.8, 9.25, 6.76, 4.90, 3.58, 2.61, 1.89, 1.38, 1.00, 0.73
--------------------------------------------------------------------------------------------------------------------------------------------------------
         Drive Axle Configuration = 4 x 2           Drive Axle Configuration = 6 x 4
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  Tire Revs/Mile = 512
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Drive Axle Ratio = 3.70
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                  Table III-7--Class 7 and 8 Tractor Baseline CO[ihel2] Emissions and Fuel Consumption
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Class 7                                           Class 8
                                                      --------------------------------------------------------------------------------------------------
                                                                   Day Cab                          Day Cab                        Sleeper Cab
                                                      --------------------------------------------------------------------------------------------------
                                                        Low roof   Mid roof  High roof   Low roof   Mid roof  High roof   Low roof   Mid roof  High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO[ihel2] (grams CO[ihel2]/ton-mile).................      119.1      127.2      129.7       91.3       96.6       98.2       84.0       90.2       87.8
Fuel Consumption (gal/1,000 ton-mile)................   11.69941   12.49509   12.74067    8.96857    9.48919    9.64637    8.25147    8.86051    8.62475
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The agencies also received comments related to the baseline heavy-
haul tractor parameters. Volvo did not agree that certain segments of 
the heavy-haul population are appropriately represented by the baseline 
in the NPRM. Volvo stated that these types of vehicles typically 
utilize an 18-speed transmission, since they require the very close 
gear ratios and nearly all heavy-haul tractors have deeper drive axle 
ratios than the agencies have assumed

[[Page 73589]]

(3.55). PACCAR commented the 14.4 first gear of the 18-speed 
transmission coupled with the 3.73 rear axle ratio is an example of a 
significant sales volume combination that meets their recommended 53:1 
Total Reduction ratio. Upon further consideration, the agencies find 
the suggestion that the baseline heavy-haul tractor is better 
represented by an 18-speed manual transmission to be persuasive. We 
therefore revised the baseline heavy-haul tractor configuration, as 
shown in Table III-8.
    The baseline 2017 MY heavy-haul tractor will emit 56.9 grams of 
CO2 per ton-mile and consume 5.59 gallons of fuel per 1,000 
ton-mile.

         Table III-8--Heavy-Haul Tractor Baseline Configuration
------------------------------------------------------------------------
                Baseline heavy-haul tractor configuration
-------------------------------------------------------------------------
Engine = 2017 MY 15L Engine with 600 HP.
------------------------------------------------------------------------
Aerodynamics (CdA in m\2\) = 5.00.
------------------------------------------------------------------------
Steer Tires (CRR in kg/metric ton) = 7.0.
------------------------------------------------------------------------
Drive Tires (CRR in kg/metric ton) = 7.4.
------------------------------------------------------------------------
Transmission = 18 speed Manual Transmission
Gear ratio = 14.4, 12.29, 8.51, 7.26, 6.05, 5.16, 4.38, 3.74, 3.2, 2.73,
 2.28, 1.94, 1.62, 1.38, 1.17, 1.00, 0.86, 0.73.
------------------------------------------------------------------------
Drive axle Ratio = 3.73.
------------------------------------------------------------------------
All Technology Improvement Factors = 0%.
------------------------------------------------------------------------

    The fuel consumption and CO2 emissions in this ``flat'' 
baseline described above remains the same over time with no assumed 
improvements after 2017, absent a Phase 2 regulation. An alternative 
baseline was also evaluated by the agencies in which there is a 
continuing uptake of technologies in the tractor market that reduce 
fuel consumption and CO2 emissions absent a Phase 2 
regulation. This alternative baseline, referred to as the ``dynamic'' 
baseline, was developed to estimate the potential effect of market 
pressures and non-regulatory government initiatives to improve tractor 
fuel consumption. The dynamic baseline assumes that the significant 
level of research funded and conducted by the Federal government, 
industry, academia and other organizations will, in the future, result 
in the adoption of some technologies beyond the levels required to 
comply with Phase 1 standards. One example of such research is the 
Department of Energy Super Truck program \237\ which has a goal of 
demonstrating cost-effective measures to improve the efficiency of 
Class 8 long-haul freight trucks by 50 percent by 2015. The dynamic 
baseline also assumes that manufacturers will not cease offering fuel 
efficiency improving technologies that currently have significant 
market penetration, such as automated manual transmissions. The 
baselines (one for each of the nine tractor types) are characterized by 
fuel consumption and CO2 emissions that gradually decrease 
between 2019 and 2028. In 2028, the fuel consumption for the 
alternative tractor baselines is approximately 4.0 percent lower than 
those shown in Table III-7. This results from the assumed introduction 
of aerodynamic technologies such as down exhaust, underbody airflow 
treatment in addition to tires with lower rolling resistance. The 
assumed introduction of these technologies reduces the CdA 
of the baseline tractors and CRR of the tractor tires. To take one 
example, the CdA for baseline high roof sleeper cabs in 
Table III-6 is 5.90 m\2\ in 2017. In 2028, the CdA of a high 
roof sleeper cab would be assumed to still be 5.90 m\2\ in the flat 
baseline case outlined above. Alternatively, in the dynamic baseline, 
the CdA for high roof sleeper cabs is 5.61 m\2\ in 2028 due 
to assumed market penetration of technologies absent the Phase 2 
regulation. The dynamic baseline analysis is discussed in more detail 
in RIA Chapter 11.
---------------------------------------------------------------------------

    \237\ U.S. Department of Energy. See SuperTruck Report to 
Congress. http://energy.gov/eere/vehicles/downloads/vehicle-technologies-office-report-adoption-new-fuel-efficient-technologies.
---------------------------------------------------------------------------

(b) Tractor Technology Effectiveness
    The agencies' assessment of the technology effectiveness was 
developed through the use of the GEM in coordination with modeling 
conducted by Southwest Research Institute. The agencies developed these 
standards through a three-step process, similar to the approach used in 
Phase 1. First, the agencies developed estimates of technology 
performance characteristics and effectiveness in terms of reducing 
CO2 emissions and fuel consumption for each technology, as 
described below. Each technology is associated with an input parameter 
which in turn is used as an input to the Phase 2 GEM simulation tool. 
There are two types of GEM input parameters. The first type requires a 
manufacturer to measure aspects of the technology. These aspects are 
used as inputs to GEM which then models the technology's effectiveness 
(i.e. the effectiveness for that technology is the GEM output). 
Aerodynamics, tire rolling resistance, engine fuel maps, axle ratio, 
the optional axle efficiency, and optional transmission efficiencies 
are examples of this first type of GEM input. The second type of GEM 
input only requires a manufacturer to install the technology onto the 
vehicle and does not require any testing to determine the GEM input. 
The agencies determined and specify in the regulations (see 40 CFR 
1037.520) the effectiveness of this second type of GEM input. The 
agencies also define the technologies that qualify to be eligible for 
these GEM technology inputs in the regulations (see 40 CFR 1037.660 and 
1037.801). Examples of these technology inputs include transmission 
type, idle reduction technologies, tire pressure systems, vehicle speed 
limiters, weight reduction, intelligent controls, and other 
accessories. The performance levels for the range of Class 7 and 8 
tractor aerodynamic packages and vehicle technologies are described 
below in Table III-10.\238\ All percentage improvements noted below are 
relative to the 2017 MY baseline tractor.
---------------------------------------------------------------------------

    \238\ These GEM default values could be superseded on a case-by-
case basis based on an appropriate off-cycle credit demonstration.
---------------------------------------------------------------------------

    As discussed in Section I.C.1.a, we assume manufacturers will 
incorporate appropriate compliance margins for all measured GEM inputs. 
In other words, they will declare values slightly higher than their 
measured values. As discussed in Section II.D.5, compliance margins 
associated with fuel maps are likely to be approximately one percent. 
For aerodynamic inputs, we believe the bin structure will eliminate the 
need for CdA compliance margins for most vehicles. However, 
for vehicles with measured CdA values very near the upper 
bin boundary, manufacturers will likely choose to certify some of them 
to the next higher bin values (as a number of commenters noted). For 
tire rolling resistance, our feasibility rests on the Phase 1 
standards, consistent with our expectation that manufacturers will to 
continue to incorporate the compliance margins they considered 
necessary for Phase 1. With respect to optional axle and/or 
transmission power loss maps, we believe manufacturers will need very 
small compliance margins. These power loss procedures require high 
precision so measurement uncertainty will likely be on the order of 0.1 
percent of the transmitted power. All of these margins are reflected in 
our projections of the emission levels that will be technologically 
feasible.
    The agencies then determined the adoption rates feasible for each

[[Page 73590]]

technology in each model year, as described in Section III.D.1.c. Then 
as described in Section III.D.1.f, the agencies combined the technology 
performance levels with a projected technology adoption rate to 
determine the GEM inputs used to set the stringency of these standards. 
The agencies input these parameters into Phase 2 GEM and used the 
output to determine the final CO2 emissions and fuel 
consumption levels.
(i) Engine Improvements
    There are several technologies that could be used to improve the 
efficiency of diesel engines used in tractors. These technologies 
include friction reduction, combustion system optimization, and waste 
heat recovery using the Rankine cycle. Details of the engine 
technologies, adoption rates, and overall fuel consumption and 
CO2 emission reductions are included in Section II.D. The 
Phase 2 engine standards will lead each manufacturer to achieve 
reductions of 1.8 percent in 2021 MY, 4.2 percent in 2024 MY, and 5.1 
percent in 2027 MY. For the final Phase 2 rule, we recognize that it 
could be possible to achieve greater reductions than those included in 
the engine standard by designing entirely new engine platforms. See 
Section II.D.2.e. Unlike existing platforms, which are limited with 
respect to peak cylinder pressures (precluding certain efficiency 
improvements), new platforms can be designed to have higher cylinder 
pressure than today's engines. New designs are also better able to 
incorporate recent improvements in materials and manufacturing, as well 
as other technological developments. Considered together, it is likely 
that a new engine platform could be about 2 percent better than engines 
using older platforms. Moreover, the agencies have seen CBI data that 
suggests improvement of more than 3 percent are possible. As discussed 
in Section II.D.2.e above, how far the various manufacturers are into 
their design cycles suggests that one or more manufacturers will 
probably introduce a new engine platform during the Phase 2 time frame. 
Thus, we project that 50 percent of tractor engines produced in 2027 MY 
will be redesigned engines (i.e. engines reflecting redesigned engine 
platforms, again based on existing engine platform redesign schedules 
within the industry). This means the average 2027 MY tractor engine 
would be 5.4 and 6.4 percent better than Phase 1 for day and sleeper 
cabs respectively.\239\ This reflects an average 0.8 percent 
improvement beyond what is required to meet the engine standards.
---------------------------------------------------------------------------

    \239\ See RIA Chapter 2.8.4.1 for the analysis of the engine 
technologies and the associated fuel maps.
---------------------------------------------------------------------------

    As noted in Section II.D.2.e, it is import to note that these new 
platforms will be developed based on normal market forces rather than 
as a result of this rulemaking. Some engine manufacturers have 
developed new platforms with the last ten years, and we do not expect 
these engines to be replaced within the Phase 2 time frame. However, 
other engines have not been fundamentally redesigned recently and will 
be due for replacement by 2027. Because these new platforms will occur 
because of market forces rather than this rulemaking, these reductions 
are in some ways windfalls for vehicle manufacturers. Thus, we have not 
included the cost of these new platforms as part of our rulemaking 
analysis.
    We have factored these levels into our analysis of the vehicle 
efficiency levels that will be achievable in MY 2027. These additional 
engine improvements will result in vehicles having lower GEM results. 
Thus, they make more stringent vehicle standards feasible, and the 
final standards are structured so that these improved engines are not 
able to generate windfall credits against the engine standards, but 
rather that their projected performance is reflected in the stringency 
of the final tractor vehicle standard. It is important to also note 
that manufacturers that do not achieve this level of engine reduction 
would be able to make up the difference by applying one of the many 
other available and cost-effective tractor technologies to a greater 
extent or more effectively, so that there are multiple technology paths 
for meeting the final standards. In other words, a manufacturer that 
does not invest in updating engine platforms in the Phase 2 time frame 
is likely to be able to invest in improving other vehicle technologies. 
(Note that these same reductions cannot be assumed as part of the 
engine standards because engine manufacturers will not have this same 
flexibility). These reductions from the engine will show up in the fuel 
maps used in GEM to set the Phase 2 tractor stringencies.
(ii) Aerodynamics
    There are opportunities to reduce aerodynamic drag from the tractor 
by further optimization of body components, but it is sometimes 
difficult to assess the benefit of individual aerodynamic features. 
Therefore, reducing aerodynamic drag requires optimizing of the entire 
system. The potential areas to reduce drag include all sides of the 
truck--front, sides, top, rear and bottom. The grill, bumper, and hood 
can be designed to minimize the pressure created by the front of the 
truck. Technologies such as aerodynamic mirrors and fuel tank fairings 
can reduce the surface area perpendicular to the wind and provide a 
smooth surface to minimize disruptions of the air flow. Roof fairings 
provide a transition to move the air smoothly over the tractor and 
trailer. Side extenders can minimize the air entrapped in the gap 
between the tractor and trailer. Lastly, underbelly treatments can 
manage the flow of air underneath the tractor. DOE has partnered with 
the heavy-duty industry to demonstrate high roof sleeper cab tractor 
and box trailer combinations that achieve a 50 percent improvement in 
freight efficiency evaluated as a 65,000 pound vehicle operating on the 
highway under somewhat controlled circumstances. However, these 
demonstration vehicles developed in SuperTruck are not necessarily 
designed to handle the rigors of daily use over actual in-use roads. 
For example, they generally have very limited ground clearance that 
would likely preclude operation in snow, and would be very susceptible 
to damage from potholes or other road hazards. Nevertheless, this 
SuperTruck program has led to significant advancements in the 
aerodynamics of combination tractor-trailers. While the agencies cannot 
simply apply the SuperTruck program achievements directly into the 
Phase 2 program because of the significant differences in the limited 
purpose of SuperTruck and the plenary applicability of a regulation to 
all operating conditions and duty cycles, it is helpful to assess the 
achievements and evaluate how the technologies could be applied into 
mass production into a variety of real world applications while 
maintaining performance throughout the full useful life of the vehicle. 
A manufacturer's SuperTruck demonstration vehicle achieved 
approximately a seven percent freight efficiency improvement over a 
2009 MY baseline vehicle due to improvements in tractor aerodynamics 
and approximately 16 percent overall for the tractor-trailer 
combination.\240\ The seven percent freight efficiency improvement due 
to tractor aerodynamics equates to roughly a 14 percent reduction in 
CdA from a 2010 MY baseline vehicle. The 2010 NAS Report on 
heavy-duty trucks found that there are achievable aerodynamic

[[Page 73591]]

improvements which yield 3 to 4 percent fuel consumption reduction or 
six to eight percent reduction in Cd values, beyond a baseline 
reflecting performance of technologies used in today's SmartWay 
trucks.\241\
---------------------------------------------------------------------------

    \240\ Daimler Truck North America. SuperTruck Program Vehicle 
Project Review. June 19, 2014.
    \241\ See TIAX, Note 230, Page 4-40.
---------------------------------------------------------------------------

    The Phase 2 aerodynamic packages are categorized as Bin I, Bin II, 
Bin III, Bin IV, Bin V, Bin VI, or Bin VII based on the wind averaged 
drag aerodynamic performance determined through testing conducted by 
the manufacturer. Bin I represents the least aerodynamic tractors, 
while Bins V-VII would be more aerodynamic than any tractor on the road 
today. A more complete description of these aerodynamic packages is 
included in Chapter 2.8.2.2 of the RIA. In general, the CdA 
values for each package and tractor subcategory were developed through 
EPA's coastdown testing of tractor-trailer combinations, the 2010 NAS 
report, and SAE papers.
    The agencies received comments on our aerodynamic technology 
assessment. A de F Limited commented that wheel covers improve the 
aerodynamics of tractors and trailers, though the results may be lost 
in the noise when evaluated on tractors and trailers separately. 
Daimler commented that they found in their SuperTruck work that there 
are diminishing opportunities for tractor aerodynamics improvements and 
there may be impediments to some due to the need to access the back of 
cab and reliability concerns. AIR CTI commented that they have built a 
truck with aerodynamic technologies such as a front spoiler that 
automatically deploys at vehicle speeds over 30 mph, aerodynamic 
mirrors, and wheel covers over the rear wheels. ICCT found in their 
workshop that opportunities exist for high roof line haul tractor 
aerodynamic improvements that could lead to a three to nine percent 
improvement in fuel consumption over a 2010 baseline.\242\ The HD 
manufacturers and EMA raised significant concerns with regard to the 
proposed aerodynamic assessment for Phase 2. They stated that even the 
best anticipated future-technology SuperTruck tractor configurations 
with a Phase 2 reference trailer likely would only qualify for the 
proposed Phase 2 Bin IV or possibly Bin V, leaving Bins V, VI and VII 
largely infeasible and unachievable.
---------------------------------------------------------------------------

    \242\ Delgado, Oscar. N. Lutsey. Advanced Tractor-Trailer 
Efficiency Technology Potential in the 2020-2030 Timeframe. April 
2015. Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    The agencies' assessment is that the most aerodynamic tractor 
tested by EPA in 2015 achieved Bin IV performance. See RIA Chapter 
3.2.1.2. This vehicle did not include all of the possible aerodynamic 
technologies, such as wheel covers or active aerodynamics like a grill 
shutter or front air dam. Upon further analysis of simulation modeling 
of a SuperTruck tractor with a Phase 2 reference trailer with skirts, 
we agree with the manufacturers that a SuperTruck tractor technology 
package would only achieve the Bin V level of CdA, as 
discussed above and in RIA Chapter 2.8.2.2. Therefore, the agencies' 
assessment is that Bin V is achievable with known aerodynamic 
technologies, as discussed in RIA Chapter 2.4.2.1 and 2.8.2.2, but 
agree with the manufacturers that Bins VI and VII have less known 
technology paths. The agencies are including definitions of Bins VI and 
VII performance in the Phase 2 regulations with the understanding that 
aerodynamics will continue to improve over the next ten years until the 
full phase-in of the Phase 2 program and to provide a value to be input 
to GEM should they do so. However, we considered the comments and 
discuss the adoption rates of the more aerodynamic bins in Section 
III.D.1.c.i, which ultimately concludes that the standards should be 
predicated only on performance of aerodynamic technologies reflecting 
up to Bin V.
    As discussed in Section III.E.2, the agencies are increasing the 
number of aerodynamic bins for low and mid roof tractors from the two 
levels adopted in Phase 1 to seven levels in Phase 2. The agencies 
adopted an increase in the number of bins for these tractors to reflect 
the actual range of aerodynamic technologies effective in low and mid 
roof tractor applications. The aerodynamic improvements to the bumper, 
hood, windshield, mirrors, and doors are developed for the high roof 
tractor application and then carried over into the low and mid roof 
applications.
(iii) Tire Rolling Resistance
    A tire's rolling resistance is a function of the tread compound 
material, the architecture and materials of the casing, tread design, 
the tire manufacturing process, and its operating conditions (surface, 
inflation pressure, speed, temperature, etc.). Differences in rolling 
resistance of up to 50 percent have been identified for tires designed 
to equip the same vehicle. Since 2007, SmartWay designated tractors 
have had steer tires with rolling resistance coefficients of less than 
6.5 kg/metric ton for the steer tire and less than 6.6 kg/metric ton 
for the drive tire.\243\ Low rolling resistance (LRR) drive tires are 
currently offered in both dual assembly and wide-based single 
configurations. Wide based single tires can offer rolling resistance 
reduction along with improved aerodynamics and weight reduction. The 
rolling resistance coefficient target for the Phase 2 NPRM was 
developed from SmartWay's tire testing to develop the SmartWay 
certification and testing a selection of tractor tires as part of the 
Phase 1 and Phase 2 programs. Even though the coefficient of tire 
rolling resistance comes in a range of values, to analyze this range, 
the tire performance was evaluated at four levels for both steer and 
drive tires, as determined by the agencies. The four levels in the 
Phase 2 proposal included the baseline (average) from 2010, Level I and 
Level 2 from Phase 1, and Level 3 that achieves an additional 25 
percent improvement over Level 2. The Level 1 rolling resistance 
performance represents the threshold used to develop SmartWay 
designated tires for long haul tractors. The Level 2 threshold 
represents an incremental step for improvements beyond today's SmartWay 
level and represents the best in class rolling resistance of the tires 
we tested for Phase 1. The Level 3 values in the NPRM represented the 
long-term rolling resistance value that the agencies predicts could be 
achieved in the 2025 timeframe. Given the multiple year phase-in of the 
standards, the agencies expect that tire manufacturers will continue to 
respond to demand for more efficient tires and will offer increasing 
numbers of tire models with rolling resistance values significantly 
better than today's typical low rolling resistance tires.
---------------------------------------------------------------------------

    \243\ U.S. EPA. ``US EPA Low Rolling Resistance Tire Testing 
Activities'' presentation to SAE Government-Industry Meeting. 
January 22, 2016. Values represent the ISO 28580 2 meter drum 
results because these align with the test method used to certify 
tractors to the GHG and fuel consumption standards.
---------------------------------------------------------------------------

    ICCT found in their workshop that opportunities exist for 
improvements in rolling resistance for tractor tires that could lead to 
a two to six percent improvement in fuel consumption when compared to a 
2010 baseline tractor.\244\ A fuel consumption improvement in this 
range would require a six to 18 percent improvement in the tractor tire 
rolling resistance levels. Michelin commented that the proposed values 
for the drive tires seem reasonable, though the 4.5 kg/ton level would 
require significantly higher adoption rate of

[[Page 73592]]

new generation wide base single tires. Michelin also stated that the 
value of 4.3 kg/ton target for steer tires is highly unlikely based on 
current evolution and that research shows that 5.0 kg/ton would be more 
likely.
---------------------------------------------------------------------------

    \244\ Delgado, Oscar. N. Lutsey. Advanced Tractor-Trailer 
Efficiency Technology Potential in the 2020-2030 Timeframe. April 
2015. Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    The agencies have evaluated this comment and find it persuasive. 
The agencies analyzed the 2014MY certification data for tractors 
between the NPRM and final rulemaking. We found that the lowest rolling 
resistance value submitted for 2014 MY GHG and fuel efficiency 
certification for tractors was 4.9 and 5.1 kg/metric ton for the steer 
and drive tires respectively, while the highest rolling resistance tire 
had a CRR of 9.8 kg/metric ton.\245\ We have accordingly increased the 
coefficient of rolling resistance for Level 3 tires in the final rule 
based on the comments and the certification data.
---------------------------------------------------------------------------

    \245\ U.S. EPA. Memo to Docket. Coefficient of Rolling 
Resistance and Coefficient of Drag Certification Data for Tractors. 
See Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

(iv) Tire Pressure Monitoring and Automatic Tire Inflation Systems
    Proper tire inflation is critical to maintaining proper stress 
distribution in the tire, which reduces heat loss and rolling 
resistance. Tires with low inflation pressure exhibit a larger 
footprint on the road, more sidewall flexing and tread shearing, and 
therefore, have greater rolling resistance than a tire operating at its 
optimal inflation pressure. Bridgestone tested the effect of inflation 
pressure and found a 2 percent variation in fuel consumption over a 40 
psi range.\246\ Generally, a 10 psi reduction in overall tire inflation 
results in about a one percent reduction in fuel economy.\247\ To 
achieve the intended fuel efficiency benefits of low rolling resistance 
tires, it is critical that tires are maintained at the proper inflation 
pressure.
---------------------------------------------------------------------------

    \246\ Bridgestone Tires. Real Questions, Real Answers. http://www.bridgestonetrucktires.com/us_eng/real/magazines/ra_special-edit_4/ra_special4_fuel-tires.asp
    \247\ ``Factors Affecting Truck Fuel Economy,'' Goodyear, Radial 
Truck and Retread Service Manual. Accessed February 16, 2010 at 
http://www.goodyear.com/truck/pdf/radialretserv/Retread_S9_V.pdf.
---------------------------------------------------------------------------

    Proper tire inflation pressure can be maintained with a rigorous 
tire inspection and maintenance program or with the use of tire 
pressure and inflation systems. According to a study conducted by FMCSA 
in 2003, about 1 in 5 tractors/trucks is operating with 1 or more tires 
underinflated by at least 20 psi.\248\ A 2011 FMCSA study estimated 
under inflation accounts for one service call per year and increases 
tire procurement costs 10 to 13 percent. The study found that total 
operating costs can increase by $600 to $800 per year due to under 
inflation.\249\ A recent study by The North American Council on Freight 
Efficiency, found that openness to the use of tire pressure monitoring 
systems is increasing. It also found that reliability and durability of 
commercially available tire pressure systems are good and early issues 
with the systems have been addressed.\250\ These automatic tire 
inflation systems (ATIS) monitor tire pressure and also automatically 
keep tires inflated to a specific level. The agencies proposed to 
provide a one percent CO2 and fuel consumption reduction 
value for tractors with automatic tire inflation systems installed.
---------------------------------------------------------------------------

    \248\ American Trucking Association. Tire Pressure Monitoring 
and Inflation Maintenance. June 2010. Page 3. Last accessed on 
December 15, 2014 at http://www.trucking.org/ATA%20Docs/About/Organization/TMC/Documents/Position%20Papers/Study%20Group%20Information%20Reports/Tire%20Pressure%20Monitoring%20and%20Inflation%20Maintenance%E2%80%94TMC%20I.R.%202010-2.pdf.
    \249\ TMC Future Truck Committee Presentation ``FMCSA Tire 
Pressure Monitoring Field Operational Test Results,'' February 8, 
2011.
    \250\ North American Council for Freight Efficiency, ``Tire 
Pressure Systems,'' 2013.
---------------------------------------------------------------------------

    Tire pressure monitoring systems (TPMS) notify the operator of tire 
pressure, but require the operator to manually inflate the tires to the 
optimum pressure. Because of the dependence on the operator's action, 
the agencies did not propose an emission reduction value for tire 
pressure monitoring systems. Instead, we requested comment on this 
approach and sought data from those that support a reduction value be 
assigned to tire pressure monitoring systems. 80 FR 40218.
    Many commenters including OOIDA, ATA, the truck manufacturers, RMA, 
UPS, Bendix, Doran, First Industries, NADA, and others suggested that 
the agencies should recognize TPMS as a technology in GEM, with the 
effectiveness value set at an equal level as ATIS. On the other hand, 
ARB generally supported the use of ATIS but not TPMS because it 
requires action from the driver. Many stakeholders stated that TPMS 
offers similar benefit, but at a lower cost, so is more acceptable in 
the market. UPS commented that they prefer TPMS because TPMS gives the 
truck owner an affirmative indication that there is a tire pressure 
problem, so it can be fixed, whereas the ATIS does not and they are 
concerned that ATIS simply keeps adding tire pressure automatically, 
wasting energy, and the truck owner may never know it. Bendix believes 
that both ATIS and TPMS should be available in the market in the Phase 
2 timeframe for tractors. RMA cited a NHTSA study of LD vehicles of 
model years 2004-2007 and found that the presence of a TPMS system led 
to a 55.6 percent reduction in the likelihood that a vehicle would have 
one tire that is significantly underinflated (25 percent or 
greater).\251\ RMA also stated that NHTSA found TPMS to be effective in 
reducing moderate under inflation (at least 10 percent, but under 25 
percent), which was reduced by 35.3 percent.\252\ RMA's comments also 
stated for light trucks and vans, the effectiveness rates were even 
higher, with TPMS reducing severe under inflation by 61.2 percent and 
moderate under inflation by 37.7 percent. RMA commented that NHTSA 
found that in 2011, the TPMS systems save $511 million in fuel costs 
across the vehicle fleet.\253\ Navistar said the driver alert with TPMS 
is simpler and sufficient to ensure tire inflation in commercial 
applications. Navistar also commented that in heavy duty, a 
professional driver has both the incentive and the knowledge to keep 
tires adequately inflated, neither of which may necessarily be the case 
with light duty. Doran Manufacturing cited FMCSA studies on TPMS in 
2006 that found TPMS were accurate at assessing tire pressure, in 2007 
found acceptable durability of TPMS, and in 2011 found that TPMS or 
ATIS in fleet studies showed a 1.4 percent improvement in fuel economy. 
ARB's technology assessment found ATIS benefit at one percent.\254\ 
ICCT found in their workshop that opportunities exist for ATIS that 
could lead to a 0.5 to two percent improvement in fuel 
consumption.\255\ AIR CTI discussed the consequences of improper 
inflation pressures on tire life, safety, stopping distance, vehicle 
vibration, and damage to the roads. AIR CTI commented that their 
Central Tire Inflation system controls tire pressure from controls on 
the dash and is commonly used in logging and other off-road 
transportation.
---------------------------------------------------------------------------

    \251\ 80 FR at 40173.
    \252\ 80 FR 40278.
    \253\ 80 FR at 40258.
    \254\ California Air Resources Board. Draft Technology 
Assessment: Engine/Powerplant and Drivetrain Optimization and 
Vehicle Efficiency. June 2015. Page III-3. Report is available at 
www.arb.ca.gov.
    \255\ Delgado, Oscar. N. Lutsey. Advanced Tractor-Trailer 
Efficiency Technology Potential in the 2020-2030 Timeframe. April 
2015. Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    After consideration of the comments, the agencies found them 
persuasive and are adopting provisions in Phase 2 GEM that allow 
manufacturers flexibility to

[[Page 73593]]

show compliance with the CO2 and fuel consumption standards 
using various technologies, including the flexibility to adopt ATIS or 
TPMS (see 40 CFR 1037.520). This reflects a change from the Phase 2 
NPRM, where only ATIS (not TPMS) was a GEM input. The agencies believe 
that sufficient incentive exists for truck operators to address low 
tire pressure conditions if they are notified that they exist through a 
TPMS.
    The agencies also considered the comments to determine the 
effectiveness of TPMS and ATIS. The agencies conducted a further review 
of the FCMSA study cited by commenters and we interpret the results of 
the study to indicate that overall a combination of TPMS and ATIS in 
the field achieved 1.4 percent reduction. However, it did not separate 
the results from each technology, and therefore did not indicate that 
TPMS and ATIS achieved the same levels of reduction. Therefore, we set 
the effectiveness of TPMS slightly lower than ATIS to reflect that 
operators will be required to take some action to insure that the 
proper inflation pressure is maintained. The input values to the Phase 
2 GEM are set to 1.2 percent reduction in CO2 emissions and 
fuel consumption for ATIS and 1.0 percent reduction for TPMS. In other 
words, if a manufacturer installs an ATIS onto a vehicle, then they 
will enter 1.2 percent into the Tire Pressure System value in their GEM 
input file. If a manufacturer installs a TPMS, then they will input 1.0 
percent into the Tire Pressure System value in GEM.
    EPA proposed a definition of ATIS in 40 CFR 1037.801 to qualify it 
as a technology input to GEM. The proposed definition stated that 
``Automatic tire inflation system means a system installed on a vehicle 
to keep each tire inflated to within 10 percent of the target value 
with no operator input.'' The agencies received comment about this 
definition. Meritor suggested adopting the historical industry 
definition of ATIS as ``Automatic Tire Inflation Systems maintain tire 
pressure at a single preset level and are pneumatically or 
electronically activated. These systems eliminate the need to manually 
inflate tires.'' Meritor is concerned with the proposed definition of 
ATIS that required the system must ``keep each tire inflated to within 
10 percent'' to qualify as a technology input to GEM. Meritor commented 
that the proposed definition is not consistent with the manner in which 
these systems are used in practice. Meritor stated that an ATIS assures 
that tires will always be running at the recommended cold tire 
inflation pressure. The agencies are adopting changes to reflect the 
appropriate definition of ATIS in the final rule (see 40 CFR 1037.801).
(v) Idle Reduction
    Auxiliary power units (APU), fuel operated heaters (FOH), battery 
supplied air conditioning, and thermal storage systems are among the 
technologies available today to reduce fuel consumption and 
CO2 emissions from extended idling (or hoteling). Each of 
these technologies reduces fuel consumption during idling relative to a 
truck without this equipment. In Phase 1 and in the Phase 2 NPRM, the 
agencies took an approach whereby tractor manufacturers could input an 
idle reduction value into GEM only if a vehicle included a tamper-proof 
automatic engine shutdown system (AESS) programmed to shut down the 
engine after five minutes or less. This approach allows the 
manufacturers to use AESS as one of the technologies (in combination 
with other technologies such as aerodynamics or low rolling resistance 
tires) to demonstrate compliance with the CO2 emission and 
fuel consumption standards. The agencies also included several override 
provisions for the AESS and a discounted GEM input value for an 
expiring AESS or a system that allowed a specified number of hours of 
idling per year (see 40 CFR 1037.660).
    The agencies did not differentiate between the various idle 
reduction technologies in terms of effectiveness because we adopted in 
Phase 1 and proposed in Phase 2 a conservative effectiveness level to 
recognize that some vehicles may be sold with only an AESS but may then 
install an idle reduction technology after it leaves the factory (76 FR 
57207). The effectiveness for AESS in Phase 1 and proposed in Phase 2 
was determined by comparing the idle fuel consumption of the main 
engine at approximately 0.8 gallons per hour to the fuel consumption of 
a diesel powered APU that consumes approximately 0.2 gallons per hour. 
This difference equates to a five percent reduction in overall 
CO2 emissions and fuel consumption of a Class 8 sleeper cab. 
A diesel powered APU was selected for determining the effectiveness and 
cost because it was a conservative estimate. Diesel powered APUs have 
the highest fuel consumption and cost of the idle reduction 
technologies considered.\256\ The agencies proposed that a tamper-proof 
AESS would receive a five percent CO2 emissions and fuel 
consumption reduction in GEM for vehicles that included this 
technology. This value is in line with the TIAX assessment which found 
a five percent reduction in overall fuel consumption to be 
achievable.\257\ The agencies requested comments on the proposed 
approach.
---------------------------------------------------------------------------

    \256\ See the draft RIA Chapter 2.4.8 for details.
    \257\ See the 2010 NAS Report at 128.
---------------------------------------------------------------------------

    The agencies received a number of comments regarding ``mandating 
APU'' or ``mandating AESS.'' There is a misconception of the proposed 
Phase 2 program where stakeholders thought that the agencies were 
mandating use of APUs. This is incorrect. The tractor standards are 
performance standards. The agencies merely projected an adoption rate 
of up to 90 percent for tamper-proof AESS in our analysis for 
determining the stringency level of the proposed standard. As stated 
above, we did not propose to differentiate between the various idle 
reduction technologies in terms of effectiveness and only used the 
diesel powered APU in terms of determining the cost and effectiveness 
of a potential standard. Also, because the standards are performance 
standards, the agencies are not mandating any specific fuel consumption 
or GHG emission reducing technology. For each standard, we developed 
one potential technology pathway to demonstrate the feasibility of the 
standards, but manufacturers will be free to choose other paths.\258\
---------------------------------------------------------------------------

    \258\ The one exception being the design standards for certain 
non-aero trailers. See Section IV below.
---------------------------------------------------------------------------

    The agencies received a significant number of comments about idle 
reduction for sleeper cabs, including recommendations to the agencies 
to assess the emission reduction for a variety of idle reduction 
technologies instead of just a tamper-proof AESS. ATA, NADA, and others 
commented that fleets have a variety of choices available in providing 
the driver power and comfort in-lieu of idling including use of APUs, 
FOHs, stop-start (main engine turns on only to recharge the battery 
after several hours), shore power, battery stand-by, stand-alone anti-
idling infrastructure establishments, slip-seat operations, and hotel 
accommodations. Convoy Solutions stated that IdleAir's electrified 
parking spaces are an important bridge technology to more electrified 
solutions. IdleAir commented it may be possible to recognize off board 
behavior at the OEM level as a buyer of a new truck could enter into a 
contract with an EPS provider prior to accepting delivery. ATA and 
First Industries support efficiency credits for idling reduction 
options installed by fleets either at the OEM point-of-sale or 
installed in the after-market.

[[Page 73594]]

    The agencies also received comments regarding the level of 
effectiveness of idle reduction technologies. ICCT found in their 
workshop that opportunities exist for line haul tractor idle reduction 
improvements that could lead to a four to seven percent improvement in 
fuel consumption.\259\ MEMA recommended that the agencies modify the 
projected effectiveness level based on the merit of the individual idle 
control technology. MEMA's recommendation for effectiveness levels 
based on the fuel consumption and GHG emissions of each technology 
ranged from 7.7 g/ton-mile for fuel cell APU, 6 g/ton-mile for diesel 
APU, and 9 g/ton-mile for batter air conditioning systems, fuel 
operated heater, and combinations of technologies. MEMA supports the 
agencies' proposal that, in order to qualify for the use of an idle 
reduction technology in GEM, it is mandatory that the truck be equipped 
with an AESS. MEMA also commented that in the Phase 1 RIA, the agencies 
assumed a Class 8 sleeper cab spends 1,800 hours in extended idle per 
year and travels about 250 days per year. MEMA recommends that the 
agencies use 2,500 annual hours for APUs and 1,250 annual hours for 
FOHs to better reflect real-world application and experiences. 
Additionally, MEMA recommends that 0.87 gallon/hour fuel consumed by 
the main engine during idle be used in the calculations for credit.
---------------------------------------------------------------------------

    \259\ Delgado, Oscar. N. Lutsey. Advanced Tractor-Trailer 
Efficiency Technology Potential in the 2020-2030 Timeframe. April 
2015. Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    The agencies also received a significant number of comments about 
idle reduction encouraging the agencies to consider recognizing 
adjustable AESS instead of only a tamper-proof AESS. ATA commented that 
most fleets already purchase ``programmable'' idle shutdown timers to 
limit idling due to the national patchwork of anti-idling laws 
currently in place. ATA continued to say that these timers are 
typically set for a given period of time throughout the initial fleet's 
ownership period. ATA also stated as witnessed under Phase I, fleets 
are unwilling to purchase hard-programmed, tamper-proof AESS given 
their need for flexibility regarding their resale of used equipment on 
the secondary market. Caterpillar also noted that fleets do not 
purchase tamper-resistant automatic engine shutdown systems; therefore, 
AESS should not be part of the stringency setting, unless the agencies 
also consider programmable versions of AESS. PACCAR, Volvo and EMA 
request the agencies to consider partial credit for AESS that are 
programmed to a 5-minute or sooner shutdown but are not tamper-
resistant to changes by an owner. Daimler and Navistar also commented 
that the agencies should consider adjustable AESS as a technology input 
to GEM. Daimler found that less than one percent of the adjustable AESS 
systems set at or below 5 minutes that were installed in customer 
tractors were deactivated or reprogrammed to a value longer than 5 
minutes. PACCAR viewed the proposed tamper-proof AESS for 1.259 million 
miles as unrealistic and not reflecting current market conditions.
    While the agencies do not necessarily believe that customer 
reluctance in the initial years of Phase 1 should be considered 
insurmountable, we do agree with commenters that the agencies should 
allow adjustable AESS to be a technology input to GEM and should 
differentiate effectiveness based on the idle reduction technology 
installed by the tractor manufacturer. We will still apply the Phase 1 
requirement that the AESS be programmed to 5 minutes or less at the 
factory to qualify as a technology input in GEM (see 40 CFR 1037.660), 
but for Phase 2 will allow a variety of both tamper-proof and 
adjustable systems to qualify for some reduction (i.e. to be recognized 
by GEM). Any changes made subsequent to the factory but prior to 
delivery to the purchaser, must be accounted for in the manufacturer's 
end of year reports.
    The agencies developed effectiveness levels for the extended idle 
technologies from literature, SmartWay work, and the 2010 NAS report. 
The agencies also reviewed the NACFE report on programmable engine 
parameters which included a fleet survey on how often the fleets change 
programmable parameters, such as automatic engine shutdown timers.\260\ 
The survey found that approximately 70 percent of these fleets never 
changed the setting. The agencies developed the effectiveness levels to 
reflect that there is some greater uncertainty of adjustable AESS 
systems, therefore the effectiveness values are discounted from the 
values determined for tamper-proof AESS. A detailed discussion 
regarding the comments and the associated calculations to determine the 
effectiveness of each of the idle reduction technologies are included 
in RIA Chapter 2.4.8.1.1. In summary, the effectiveness for each type 
of idle reduction technology is included in Table III-9.
---------------------------------------------------------------------------

    \260\ North American Council for Freight Efficiency. Confidence 
Report: Programmable Engine Parameters. February 2015. Page 48.

          Table III-9--Idle Reduction Technology Effectiveness
------------------------------------------------------------------------
                                                          Idle reduction
                Idle Reduction Technology                  value in GEM
                                                                (%)
------------------------------------------------------------------------
Tamper-Proof AESS.......................................               4
Tamper-Proof AESS w/Diesel APU..........................               4
Tamper-Proof AESS w/Battery APU.........................               6
Tamper-Proof AESS w/Automatic Stop-Start................               3
Tamper-Proof AESS w/FOH Cold, Main Engine Warm..........               3
Adjustable AESS w/Diesel APU............................               3
Adjustable AESS w/Battery APU...........................               5
Adjustable AESS w/Automatic Stop-Start..................               3
Adjustable AESS w/FOH Cold, Main Engine Warm............               2
Adjustable AESS programmed to 5 minutes.................               1
------------------------------------------------------------------------

    In addition to extended idling (or hoteling) by sleeper cabs, the 
agencies discussed work day idle by day cabs in the Phase 2 NPRM. 80 FR 
40217. Day cab tractors often idle while cargo is loaded or unloaded, 
as well as during the frequent stops that are inherent with driving in 
urban traffic conditions near cargo destinations. Prior to issuing the 
Phase 2 NPRM, the agencies reviewed literature to quantify the amount 
of idling which is conducted outside of hoteling operations. One study, 
conducted by Argonne National Laboratory, identified several different 
types of trucks which might idle for extended amounts of time during 
the work day.\261\ Idling may occur during the delivery process, 
queuing at loading docks or border crossings, during power take off 
operations, or to provide comfort during the work day. However, the 
study provided only ``rough estimates'' of the idle time and energy use 
for these vehicles. At the time of the Phase 2 NPRM, the agencies were 
not able to appropriately develop a baseline of workday idling for day 
cabs and identify the percent of this idling which could be reduced 
through the use of AESS. We welcomed comment and data on quantifying 
the effectiveness of AESS on day cabs. We further requested comment on 
the possibility of adapting the idle-only duty cycle for vocational 
vehicles to certain day cab tractors, and also considered the 
possibility of neutral idle technology for tractors using torque-
converter automatic

[[Page 73595]]

transmissions and stop-start for any tractor. Id.
---------------------------------------------------------------------------

    \261\ Gaines, L., A. Vyas, J. Anderson. Estimation of Fuel Use 
by Idling Commercial Trucks. January 2006.
---------------------------------------------------------------------------

    The agencies received a significant number of comments regarding 
day cab idle reduction. CARB commented that the agencies should include 
idle reduction technologies for day cabs, similar to the proposed 
vocational vehicle approach. CARB stated that even if the first owners 
do not see significant emission reductions, many of the day cab 
tractors are used in port and drayage applications in their second life 
where they would see significant reductions. CARB suggested that the 
GEM composite weighting factor for idle should be between 5 and 10 
percent. Bendix would like to see the vocational vehicle idle reduction 
approach extended to day cab tractors based on their data which found 
that there are many applications of day cab tractors that spend a 
significant portion of their day's drive time at idle, especially pick-
up and delivery type applications and a growing number of fleets that 
run hub and spoke type operations. MEMA supported extending neutral 
idle and stop-start technologies to day cab tractors. MEMA recommends 
that the agencies set the effectiveness of day cabs idle reduction 
technologies at a value equal to 35 percent of the effectiveness 
associated with a comparable technology in a Class 8 sleeper cab. 
Allison stated that agencies should include automatic neutral in all 
tractors. Allison stated that automatic neutral is standard with the 
Allison TC10 and is available with the Allison 3000 and 4000 Series 
transmissions.
    Daimler commented that they have not validated that stop-start 
strategies are viable for Class 7 and 8 applications and considers it 
premature for the agencies to project that stop-start strategies are 
viable for this class of engines. Daimler stated that lubrication of 
critical bearing surfaces is lacking or severely compromised during 
engine start up due to the lack of lubricating oil pressure and this 
lack of lubrication leads to metal to metal contact, wear, and 
ultimately failure. In addition, Daimler commented that firing 
pressures inherent to compression ignition engines further exacerbate 
wear as compared to, for example, spark ignition engines where stop-
start technology is being increasingly applied. Daimler also stated 
that these known problems, coupled with the extremely long million mile 
plus service life expectations for this heavier class of heavy-duty 
engines, together pose a development challenge that is significantly 
more challenging than that posed to spark ignition engines in passenger 
cars. Daimler further stated that heat soak of temperature critical 
parts and temporary disruption of their lubrication/cooling systems 
will have to be understood and possible degradations handled through 
modifications at either component or system basis, the extent of which 
is not yet fully quantified. Daimler also stated that similarly, on the 
turbocharger side, the larger speed swings will shorten turbocharger 
wheel life, which is increasingly challenged in vocational applications 
that are characteristically more transient as compared to the 
relatively steady operation nature of line haul.
    The agencies considered the comments, both supporting and raising 
concerns over idle reduction in day cabs. The agencies determined that 
neutral idle for automatic transmissions is an appropriate technology 
for use in tractors. Therefore, the agencies are adopting provisions in 
Phase 2 to recognize neutral-idle in automatic transmissions as an 
input to GEM. Our analysis shows that neutral idle effectiveness is 
approximately 0.8 to one percent over the composite day cab tractor 
cycles, as shown in RIA Chapter 2.8.2.6.2. The agencies will also 
include neutral idle as a GEM input for sleeper cabs, though the 
effectiveness is very low. The agencies are predicating the standards 
for day cabs based on a technology package that includes neutral idle.
    In terms of stop-start technologies in tractors, the agencies are 
not including it as a technology input to GEM because we believe the 
technology, as applied to tractors, needs further development. If this 
technology is developed in the future for tractors, then manufacturers 
may consider applying for off-cycle technology credits. Since the 
agencies are not predicating the Phase 2 standards on adoption of 
start-stop technologies, the agencies are also not including this 
technology as a GEM input.
(vi) Transmissions
    As discussed in the 2010 NAS report, automatic (AT) and automated 
manual transmissions (AMT) may offer the ability to improve vehicle 
fuel consumption by optimizing gear selection compared to an average 
driver.\262\ However, as also noted in the report and in the supporting 
TIAX report, the improvement is very dependent on the driver of the 
truck, such that reductions ranged from zero to eight percent.\263\ 
Well-trained drivers would be expected to perform as well or even 
better than an automated transmission since the driver can see the road 
ahead and anticipate a changing stoplight or other road condition that 
neither an automatic nor automated manual transmission can anticipate. 
However, less well-trained drivers that shift too frequently or not 
frequently enough to maintain optimum engine operating conditions could 
be expected to realize improved in-use fuel consumption by switching 
from a manual transmission to an automatic or automated manual 
transmission. As transmissions continue to evolve, dual clutch 
transmissions (DCTs) are now being used in the European heavy-duty 
vehicle market. DCTs operate similar to AMTs, but with two clutches so 
that the transmission can maintain engine speed during a shift which 
improves fuel efficiency.
---------------------------------------------------------------------------

    \262\ Manual transmissions require the driver to shift the gears 
and manually engage and disengage the clutch. Automatic 
transmissions shift gears through computer controls and typically 
include a torque converter. An AMT operates similar to a manual 
transmission, except that an automated clutch actuator disengages 
and engages the drivetrain instead of a human driver. An AMT does 
not include a clutch pedal controllable by the driver or a torque 
converter.
    \263\ See TIAX, Note 230, above at 4-70.
---------------------------------------------------------------------------

    The benefits for automated manual, automatic, and dual clutch 
transmissions were developed from literature, from simulation modeling 
conducted by Southwest Research Institute, and powertrain testing 
conducted at Oak Ridge National Laboratory. The proposed Phase 2 
benefit of these transmissions in GEM was set at a two percent 
improvement over a manual transmission due to the automation of the 
gear shifting. 80 FR 40217.
    Allison Transmission commented that their real world studies 
indicate that automatic transmissions perform as well or better than 
AMTs or DCTs in terms of GHG and fuel efficiency impact. Allison 
commented that their ATs can exceed the 2 percent level estimated at 
proposal, but believe it is a reasonable level to apply this level of 
effectiveness for ATs and AMTs. Allison stated that automatic 
transmissions in tractors have neutral at stop capability, first gear 
lockup operation, load-based and grade-based shift algorithms and 
acceleration rate management that contribute to the overall fuel 
efficiency of ATs in tractors. Allison also commented that although 
DCTs should logically perform better than the MT baseline, there was no 
record information to support that assumption. Volvo commented that 
fuel consumption with their I-Shift DCT is the same as the I-Shift AMT. 
PACCAR recommends that the agencies take a more detailed approach to 
assessing transmission advances and revise the

[[Page 73596]]

agencies' estimate to reflect technologies that are already under true 
consideration for use in production powertrains.
    UCS commented that as much as 1.3 to 2.0 percent savings from 
tractor-trailers could be added to the proposed stringency to reflect 
the true potential from tractor-trailers from powertrain optimization, 
particularly since every major manufacturer already offers at least one 
``integrated powertrain'' option in its long-haul fleet. ICCT referred 
to two studies related to tractor-trailer technologies in their 
comments.264 265 In their stakeholder workshop, they found 
that the effectiveness of automated manual transmissions ranged between 
two and three percent. They also cited another finding that highlighted 
opportunities to improve transmission efficiency, including direct 
drive, which would provide about two percent fuel consumption 
reduction.\266\
---------------------------------------------------------------------------

    \264\ Lutsey, Nic. T. Langer, S. Khan. Stakeholder Workshop on 
Tractor-Trailer Efficiency Technology in the 2015-2030 Timeframe. 
August 2014. Docket EPA-HQ-OAR-2014-0827.
    \265\ Delgado, Oscar. N. Lutsey. Advanced Tractor-Trailer 
Efficiency Technology Potential in the 2020-2030 Timeframe. April 
2015. Docket EPA-HQ-OAR-2014-0827.
    \266\ Stoltz, T. and Dorobantu, M. Transmission Potential to 
Contribute to CO2 Reduction: 2020 and Beyond Line Haul 
Perspective. ACEEE/ICCT Workshop on Emerging Technologies for Heavy-
Duty Fuel Efficiency. July 2014.
---------------------------------------------------------------------------

    The agencies' assessment of the comments is that Allison, ICCT, and 
Volvo support the proposed two percent effectiveness for AT and AMT 
transmission types. In addition, the agencies reviewed the NACFE report 
on electronically controlled transmissions (AT, AMT, and DCT).\267\ 
This report had similar findings as those noted above in the NAS 2010 
report. Electronically controlled transmissions were found to be more 
fuel efficient than manual transmissions, though the amount varied 
significantly. The report also stated that fleets found that 
electronically controlled transmissions also reduced the fuel 
efficiency variability between drivers. Therefore after considering the 
comments related to effectiveness and additional reports, the agencies 
are adopting as proposed a two percent effectiveness for AMT. As 
discussed in RIA 2.8.2.5, the agencies conducted powertrain testing at 
Oak Ridge National Laboratory to compare the fuel efficiency of an AMT 
to an AT. Based on the results, the agencies expect that automatic 
transmissions designed for long haul operation and automated manual 
transmissions will perform similarly and have similar effectiveness 
when compared to a manual transmission.
---------------------------------------------------------------------------

    \267\ North American Council for Freight Efficiency. Confidence 
Report: Electronically Controlled Transmissions. December 2014.
---------------------------------------------------------------------------

    The benefit of the AMT's automatic shifting compared to a manual 
transmission is recognized in Phase 2 GEM by simulating the MT as an 
AMT and increasing the emission results from the simulation by two 
percent. For ATs, the agencies developed the default automatic 
transmission inputs to GEM to represent a typical heavy-duty automatic 
transmission, which is less efficient than the TC10 (the transmission 
tested at Oak Ridge National Lab). The agencies selected more 
conservative default transmission losses in GEM so that we would not 
provide a false efficiency improvement for the less efficient automatic 
transmissions that exist in the market today. Under the regulations in 
this rulemaking, manufacturers that certify using the TC10 transmission 
would need to either conduct the optional transmission gear efficiency 
testing or powertrain testing to recognize the effectiveness of this 
type of automatic transmission in GEM. In our technology packages 
developed to set the Phase 2 standard stringencies, the agencies used a 
two percent effectiveness for automatic transmissions with neutral idle 
under the assumption that either powertrain or transmission gear 
efficiency tests would be conducted. The compliance costs for this type 
of testing (which crosses over both the vocational and tractor 
programs) are included as noted in RIA Chapter 7.2.1.2.
    The agencies agree with PACCAR that we should consider future 
transmission advances. There are three certification pathways for 
manufacturers to assess benefits of future transmissions; that is, to 
generate a value reflecting greater improvement than the two percent 
GEM input. The first is an optional powertrain test (40 CFR 1037.550), 
the second is an optional transmission efficiency test (40 CFR 
1037.565), and the third is off-cycle credits (40 CFR 1037.610).
    The agencies acknowledge UCS's comment about increasing the 
stringency of the tractor program due to the opportunity to further 
improve powertrain optimization through powertrain testing. For the 
Phase 2 final rule, we have made several changes that capture much of 
the improvement potential highlighted by UCS. First, the required use 
of a cycle average fuel map in lieu of a steady state fuel map for 
evaluating the transient cycle in GEM will recognize improvements to 
transient fuel control of the engine. The agencies are including the 
impact of improved transient fuel control in the engine fuel maps used 
to derive the final standards. Second, the optional transmission 
efficiency test will recognize the benefits of improved gear 
efficiencies. The agencies have built some improvements in transmission 
gear efficiency into the technology package used to derive the final 
standards. This leaves only the optimization of the transmission shift 
strategy, which would need to be captured on a powertrain test. The 
agencies believe that the opportunity of shift strategy optimization is 
less for tractors than for other types of vocational vehicles because a 
significant portion of the tractor drive cycles are at highway speeds 
with limited transmission shifting. Therefore, we have not included the 
powertrain optimization portion only recognized through powertrain 
testing into the standard setting for the final rule.
    The agencies also proposed standards that considered the efficiency 
benefit of transmissions that operate with top gear direct drive 
instead of overdrive. In the proposal, we estimated that direct drive 
had two percent higher gear efficiency than an overdrive gear. 80 FR 
40229. The benefit of direct drive was recognized through the 
transmission gear ratio inputs to GEM. Direct drive leads to greater 
reductions of CO2 emissions and fuel consumption during 
highway operation, but virtually none in transient operation. The 
agencies did not receive any negative comments regarding the efficiency 
difference between direct drive and overdrive; therefore, we continued 
to include the default transmission gear efficiency advantage of two 
percent for a gear with a direct drive ratio in the version of GEM 
adopted for the final Phase 2 rules.
    The agencies are also adopting in Phase 2 an optional transmission 
efficiency test (40 CFR 1037.565) for generating an input to GEM that 
overrides the default efficiency of each gear based on the results of 
the test. Although optional, the transmission efficiency test will 
allow manufacturers to reduce the CO2 emissions and fuel 
consumption by designing better transmissions with lower friction due 
to better gear design and/or mandatory use of better lubricants. The 
agencies project that transmission efficiency could improve one percent 
over the 2017 baseline transmission in Phase 2. Our assessment was 
based on comments received and discussions with transmission 
manufacturers.\268\
---------------------------------------------------------------------------

    \268\ Memorandum to the Docket ``Effectiveness of Technology to 
Increase Transmission Efficiency.'' July 2016.

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[[Page 73597]]

(vii) Drivetrain and Engine Downspeeding
    Downspeeding: As tractor manufacturers continue to reduce the 
losses due to vehicle loads, such as aerodynamic drag and rolling 
resistance, the amount of power required to move the vehicle decreases. 
In addition, engine manufacturers continue to improve the power density 
of heavy-duty engines through means such as reducing the engine 
friction due to smaller surface area. These two changes lead to the 
ability for truck purchasers to select lower displacement engines while 
maintaining the previous level of performance. Engine downsizing could 
be more effective if it is combined with the downspeeding assuming 
increased brake mean effective pressure does not affect durability. The 
increased efficiency of the vehicle moves the operating points down to 
a lower load zone on a fuel map, which often moves the engine away from 
its sweet spot to a less efficient zone. In order to compensate for 
this loss, downspeeding allows the engine to run at a lower engine 
speed and move back to higher load zones, and thus can slightly improve 
fuel efficiency. Reducing the engine size allows the vehicle operating 
points to move back to the sweet spot, thus further improving fuel 
efficiency. Engine downsizing can be accounted for as a vehicle 
technology through the use of the engine's fuel map in GEM in 
combination with the vehicle's transmission gear ratios, drive axle 
ratio, and tire diameter. The agencies evaluated the impact of 
downspeeding in setting the stringencies by modeling different rear 
axle ratios in GEM. As shown in RIA Chapter 2.8.2.7, a decrease in 
final drive ratio from 2.6 to 2.3 will lead to a 2.5 percent reduction 
in tractor CO2 emissions and fuel consumption. The reshaping 
of the torque curve of an engine to increase the low speed torque and 
reduce the speed at which maximum torque occurs, will impact the 
CO2 emissions and fuel consumption on the engine test 
cycles, but will also have a small impact on the vehicle fuel 
consumption. Higher torque at lower engine speeds will allow the 
transmission to operate in top gear for a longer period of the time 
which will reduce the number of downshifts over a cycle and in turn 
means that the engine speed is lower on average. This benefit will show 
up in GEM. Additional information on engine downspeeding can be found 
in RIA Chapter 2.3.8.
    Low Friction Axle and Wheel Bearing Lubricants: The 2010 NAS report 
assessed low friction lubricants for the drivetrain as providing a one 
percent improvement in fuel consumption based on fleet testing.\269\ A 
field trial of European medium-duty trucks found an average fuel 
consumption improvement of 1.8 percent using SAE 5W-30 engine oil, SAE 
75W90 axle oil and SAE 75W80 transmission oil when compared to SAE 
15W40 engine oil and SAE 90W axle oil, and SAE 80W transmission 
oil.\270\ The light-duty 2012-16 MY vehicle rule and the pickup truck 
portion of this program estimate that low friction lubricants can have 
an effectiveness value between zero and one percent compared to 
traditional lubricants. In the Phase 2 proposal, the agencies proposed 
the reduction in friction due to low viscosity axle lubricants of 0.5 
percent. 80 FR 40217.
---------------------------------------------------------------------------

    \269\ See the 2010 NAS Report, Note 229, page 67.
    \270\ Green, D.A., et. al. ``The Effect of Engine, Axle, and 
Transmission Lubricant, and Operating Conditions on Heavy Duty 
Diesel Fuel Economy. Part 1: Measurements.'' SAE 2011-01-2129. SAE 
International Journal of Fuels and Lubricants. January 2012.
---------------------------------------------------------------------------

    Lubrizol commented that high performing lubricants should play a 
role in Phase 2. Lubrizol also supports the axle test procedures to 
further recognize axle efficiency improvements. PACCAR recommended 
eliminating the rear axle efficiency test and provide credits based on 
calculated values.
    The agencies' assessment of axle improvements found that axles 
built in the Phase 2 timeline could be 2 percent more efficient than a 
2017 baseline axle.\271\ In lieu of a fixed value for low friction axle 
lubricants (i.e. in lieu of a specified GEM input), the agencies are 
adopting an axle efficiency test procedure (40 CFR 1037.560), as 
discussed in the NPRM. 80 FR 40185. The axle efficiency test will be 
optional, but will allow manufacturers to recognize in GEM reductions 
in CO2 emissions and fuel consumption through improved axle 
gear designs and/or mandatory use of low friction lubricants. The 
agencies are not providing an alternate path to recognize better 
lubricants without axle testing.
---------------------------------------------------------------------------

    \271\ Memorandum to the Docket ``Effectiveness of Technology to 
Increase Axle Efficiency.'' July 2016.
---------------------------------------------------------------------------

    Axle Configuration: Most tractors today have three axles--a steer 
axle and two rear drive axles, and are commonly referred to as 6x4 
tractors. Manufacturers offer 6x2 tractors that include one rear drive 
axle and one rear non-driving axle. The 6x2 tractors offer three 
distinct benefits. First, the non-driving rear axle does not have 
internal friction and therefore reduces the overall parasitic losses in 
the drivetrain. In addition, the 6x2 configuration typically weighs 
approximately 300 to 400 lbs less than a 6x4 configuration.\272\ 
Finally, the 6x2 typically costs less or is cost neutral when compared 
to a 6x4 tractor. Sources cite the effectiveness of 6x2 axles at 
between one and three percent.273 274 The NACFE report found 
in OEM evaluations of 6x2 axles that the effectiveness ranged between 
1.6 and 2.2 percent. NACFE also evaluated 6x2 axle tests conducted by 
several fleets and found the effectiveness in the range of 2.2 to 4.6 
percent. Similarly, with the increased use of double and triple 
trailers, which reduce the weight on the tractor axles when compared to 
a single trailer, manufacturers offer 4x2 axle configurations. The 4x2 
axle configuration would have as good as or better fuel efficiency 
performance than a 6x2. The agencies proposed to apply a 2.5 percent 
improvement in vehicle efficiency to 6x4 and 4x2 axle configurations. 
80 FR 40217-218.
---------------------------------------------------------------------------

    \272\ North American Council for Freight Efficiency. 
``Confidence Findings on the Potential of 6x2 Axles.'' 2014. Page 
16.
    \273\ Ibid.
    \274\ Reinhart, T.E. (June 2015). Commercial Medium- and Heavy-
Duty Truck Fuel Efficiency Technology Study--Report #1. (Report No. 
DOT HS 812 146). Washington, DC: National Highway Traffic Safety 
Administration.
---------------------------------------------------------------------------

    Meritor stated in their comments that their internal testing and 
real world testing supported the 2.5 percent efficiency proposed by the 
agencies for 6x2 axles. Meritor suggested the need to better define a 
``disengageable tandem'' when the agencies discussed what we called 
axle disconnect in the NPRM. Meritor recommends that a fuel efficiency 
benefit of 2.0 percent be assigned to the disengageable tandem for the 
55 mph and 65 mph drive cycles to account for the more limited use.
    ICCT referred to two studies related to tractor-trailer 
technologies in their comments.275 276 In their stakeholder 
workshop, they found that the effectiveness of 6x2 axles ranged between 
one and 2.5 percent.
---------------------------------------------------------------------------

    \275\ Lutsey, Nic. T. Langer, S. Khan. Stakeholder Workshop on 
Tractor-Trailer Efficiency Technology in the 2015-2030 Timeframe. 
August 2014. Docket EPA-HQ-OAR-2014-0827.
    \276\ Delgado, Oscar. N. Lutsey. Advanced Tractor-Trailer 
Efficiency Technology Potential in the 2020-2030 Timeframe. April 
2015. Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    The agencies' assessments of these technologies show that the 
reductions are in the range of two to three percent. For the final 
rule, the agencies are simulating 6x2, 4x2, and disengageable axles 
within GEM based on the manufacturer input of the axle configuration 
instead of providing a fixed value for the reduction. This approach is 
more technically sound because it will take into account future changes 
in axle efficiency. See RIA

[[Page 73598]]

Chapter 4 for additional details regarding GEM.
(viii) Accessories and Other Technologies
    Accessory Improvements: Parasitic losses from the engine come from 
many systems, including the water pump, oil pump, and power steering 
pump. Reductions in parasitic losses are one of the areas being 
developed under the DOE SuperTruck program. As presented in the DOE 
Merit reviews, Navistar stated that they demonstrated a 0.45 percent 
reduction in fuel consumption through water pump improvements and 0.3 
percent through oil pump improvements compared to a current engine. In 
addition, Navistar showed a 0.9 percent benefit for a variable speed 
water pump and variable displacement oil pump. Detroit Diesel reports a 
0.5 percent benefit coming from improved water pump efficiency.\277\ It 
should be noted that water pump improvements include both pump 
efficiency improvement and variable speed or on/off controls. Lube pump 
improvements are primarily achieved using variable displacement pumps 
and may also include efficiency improvement. All of these results shown 
in this paragraph are demonstrated through the DOE SuperTruck program 
at a single operating point on the engine map, and therefore the 
overall expected reduction of these technologies is less than the 
single point result. The agencies proposed that compared to 2017 MY air 
conditioners, air conditioners with improved efficiency compressors 
will reduce CO2 emissions by 0.5 percent. Improvements in 
accessories, such as power steering, can lead to an efficiency 
improvement of one percent over the 2017 MY baseline. 80 FR 40218.
---------------------------------------------------------------------------

    \277\ See the RIA Chapter 2.4 for details.
---------------------------------------------------------------------------

    Navistar commented that the proposed ``electrically powered pumps 
for engine cooling'' be revised to include ``electronically controlled 
variable speed coolant pumps'' to align with the Preamble descriptions 
and technology under development as part of the SuperTruck program. 
Navistar commented that shifting to fully electronic pump creates 
reliability concerns and adds additional complexity due to the size of 
the necessary pumps (2+ horsepower) and that the increased power load 
will require a larger alternator and upgraded wiring. Navistar 
suggested that in addition to a fully electric pump, Dual Displacement 
power steering should also be included as an accessory improvement 
because this technology reduces parasitic loads by applying power 
proportional to steering demand. ZF TRW Commercial Steering commented 
that they are developing a power steering pump that uses a secondary 
chamber deactivation during highway cruise operations that reduce the 
pump drive torque by 30 to 40 percent. Navistar also commented that the 
effectiveness for an electrified air conditioning compressor is 
understated in the NPRM. Navistar's estimates are closer to 1.5 percent 
when in use which will be during the use of air conditioning and during 
defrost; therefore, the effective benefit should be one percent. 
Daimler commented that the proposed high efficiency air conditioning 
effectiveness should be refined and that other opportunities to reduce 
losses, such as blend air systems, should be considered. In response to 
the comments, the agencies evaluated a set of accessories that can be 
designed to reduce accessory losses. Due to the complexity in 
determining what qualifies as an efficient accessory, we are 
maintaining the proposed language for accessories for tractors which 
provides defined effectiveness values for only electric air 
conditioning compressors and electric power steering pumps and coolant 
pumps. Manufacturers have the option to apply for off-cycle credits for 
the other types and designs of high efficiency accessories.
    Intelligent Controls: Skilled drivers know how to control a vehicle 
to obtain maximum fuel efficiency by, among other things, considering 
road terrain. For example, the driver may allow the vehicle to slow 
down below the target speed on an uphill and allow it to go over the 
target speed when going downhill, to essentially smooth out the engine 
demand. Electronic controls can be developed to essentially mimic this 
activity. The agencies proposed to provide a two percent reduction in 
fuel consumption and CO2 emissions for vehicles configured 
with intelligent controls, such as predictive cruise control. 80 FR 
40218. ICCT found in their workshop that opportunities exist for road 
load optimization through predictive cruise, GPS, and driver feedback 
that could lead to a zero to five percent improvement in fuel 
consumption.\278\ Daimler commented that eCoast should also be 
recognized as an intelligent control within GEM. Eaton offers similar 
technology, known as Neutral Coast Mode. Neutral coast is an electronic 
feature that places an automated transmission in neutral on downhill 
grades which allows the engine speed to go idle speed. A fuel savings 
is recognized due to the difference in engine operating conditions due 
to the reduced load on the engine due to the transmission.
---------------------------------------------------------------------------

    \278\ Delgado, Oscar. N. Lutsey. Advanced Tractor-Trailer 
Efficiency Technology Potential in the 2020-2030 Timeframe. April 
2015. Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    Based on literature information, intelligent controls such as 
predictive cruise control will reduce CO2 emissions by two 
percent, and the agencies are assuming this level of improvement in 
considering the level of the tractor standard. In addition, the 
agencies' review of literature and confidential business information 
provided based on the SuperTruck demonstration vehicles indicates that 
neutral coasting will reduce fuel consumption and CO2 
emissions by 1.5 percent.
    Solar Load Management: The agencies received a letter from the 
California Air Resources Board prior to the proposal requesting 
consideration of including technologies that reduce solar heating of 
the cab (to reduce air conditioning loads) in setting the Phase 2 
tractor standards. Solar reflective paints and solar control glazing 
technologies are discussed in RIA Chapter 2.4.9.3. The agencies 
requested comment on the Air Resources Board's letter and 
recommendations.\279\ The agencies received some clarifications from 
ARB on our evaluation of solar technologies and some CBI from Daimler, 
but not a sufficient amount of information to evaluate the baseline 
level of solar control that exists in the heavy-duty market today, 
determine the effectiveness of each of the solar technologies, or to 
develop a definition of what qualifies as a solar control technology 
that could be used in the regulations. Therefore, the agencies would 
consider solar control to be a technology that manufacturers may 
consider pursuing through the off-cycle credit program. As such, the 
agencies did not include solar load management technologies in the 
technology packages used in setting the final Phase 2 tractor standard 
stringencies.
---------------------------------------------------------------------------

    \279\ California Air Resources Board. Letter from Michael Carter 
to Matthew Spears dated December 3, 2014. Solar Control: Heavy-Duty 
Vehicles White Paper. Docket EPA-HA-OAR-2014-0827.
---------------------------------------------------------------------------

(ix) Weight Reduction
    Reductions in vehicle mass lower fuel consumption and GHG emissions 
by decreasing the overall vehicle mass that is moved down the road. 
Weight reductions also increase vehicle payload capability which can 
allow additional tons to be carried by fewer trucks consuming less fuel 
and producing

[[Page 73599]]

lower emissions on a ton-mile basis. We treated such weight reduction 
in two ways in Phase 1 to account for the fact that combination 
tractor-trailers weigh-out approximately one-third of the time and 
cube-out approximately two-thirds of the time. Therefore in Phase 1 and 
also as finalized for Phase 2, one-third of the weight reduction will 
be added payload in the denominator while two-thirds of the weight 
reduction is subtracted from the overall weight of the vehicle in GEM. 
See 76 FR 57153.
    In Phase 1, we reflected mass reductions for specific technology 
substitutions (e.g., installing aluminum wheels instead of steel 
wheels). These substitutions were included where we could with 
confidence verify the mass reduction information provided by the 
manufacturer. The weight reductions were developed from tire 
manufacturer information, the Aluminum Association, the Department of 
Energy, SABIC and TIAX. The agencies proposed to expand the list of 
weight reduction components which can be input into GEM in order to 
provide the manufacturers with additional means to comply via GEM with 
the combination tractor standards and to further encourage reductions 
in vehicle weight. As in Phase 1, we recognize that there may be 
additional potential for weight reduction in new high strength steel 
components which combine the reduction due to the material substitution 
along with improvements in redesign, as evidenced by the studies done 
for light-duty vehicles.\280\ The agencies however do not agree with 
all of the recommendations in this report. See Section I.C.1 and RTC 
Section 1 for a discussion on lifecycle emissions. In the development 
of the high strength steel component weights, we are only assuming a 
reduction from material substitution and no weight reduction from 
redesign, since we do not have any data specific to redesign of heavy-
duty components nor do we have a regulatory mechanism to differentiate 
between material substitution and improved design. Additional weight 
reduction would be evaluated as a potential off-cycle credit. As 
described in Section III.E.2 below, the agencies discuss the weight 
reduction component comments received and are adopting an expanded list 
of weight reduction options which could be input into the GEM by the 
manufacturers to reduce their certified CO2 emission and 
fuel consumption levels.
---------------------------------------------------------------------------

    \280\ American Iron and Steel Institute. ``A Cost Benefit 
Analysis Report to the North American Steel Industry on Improved 
Material and Powertrain Architectures for 21st Century ``Trucks.''
---------------------------------------------------------------------------

(x) Vehicle Speed Limiter
    Fuel consumption and GHG emissions increase proportional to the 
square of vehicle speed. Therefore, lowering vehicle speeds can 
significantly reduce fuel consumption and GHG emissions. A vehicle 
speed limiter (VSL), which limits the vehicle's maximum speed, is 
another technology option for compliance that is already utilized today 
by some fleets (though the typical maximum speed setting is often 
higher than 65 mph).
    CARB recommended not giving any credit for VSLs because the 
available data do not fully support whether VSLs result in real-world 
fuel consumption and GHG reductions. CARB referenced Oakridge National 
Laboratory's Transportation Energy Data Book, Table 5.11 that shows 
CO2 emissions decrease with increased speed. CARB also 
stated that the draft GEM model appears to offer up to 22 percent 
credit for use of VSL set to 45 mph, which they consider to be 
unreasonably high. Before including VSLs as a technology, CARB staff 
suggests that EPA and NHTSA should thoroughly evaluate whether they 
would result in real-world CO2 and fuel consumption 
benefits.
    The agencies conducted in-use tractor testing at different speeds 
and in turn used this data to validate the GEM simulations of VSL, as 
discussed in more detail in RIA Chapter 4. The agencies are confident 
that GEM appropriately recognizes the impact of VSL on CO2 
emissions and fuel consumption. The agencies have limited the range of 
inputs to the VSL in Phase 2 GEM to a minimum of 55 mph to align with 
the regulations in 40 CFR 1037.631 that provide exemptions for 
vocational vehicles intended for off-road use. A 55 mph VSL installed 
on a typical day cab tractor would reduce the composite grams of 
CO2 emitted per ton-mile by seven percent. Similarly, a 55 
mph VSL on a sleeper cab would reduce the composite grams of 
CO2 per ton-mile emitted by 10 percent. Please see RIA 
Chapter 2.8 for additional detail of technology impacts.
(xi) Hybrid Powertrains
    In Phase 2, hybrid powertrains are generally considered a 
conventional rather than innovative technology, especially for 
vocational vehicles. However, hybrid powertrain development in Class 7 
and 8 tractors has been limited to a few manufacturer demonstration 
vehicles to date. One of the key benefit opportunities for fuel 
consumption reduction with hybrids is less fuel consumption when a 
vehicle is idling, but the standard is already premised on use of 
extended idle reduction so use of hybrid technology will duplicate many 
of the same emission reductions attributable to extended idle 
reduction. NAS estimated that hybrid systems would cost approximately 
$25,000 per tractor in the 2015 through the 2020 time frame and provide 
a potential fuel consumption reduction of ten percent, of which six 
percent is idle reduction that can be achieved (less expensively) 
through the use of other idle reduction technologies.\281\ The limited 
reduction potential outside of idle reduction for Class 8 sleeper cab 
tractors is due to the mostly highway operation and limited start-stop 
operation. Due to the high cost and limited benefit during the model 
years at issue in this action, the agencies did not include hybrids in 
assessing stringency of the proposed tractor standard.
---------------------------------------------------------------------------

    \281\ See the 2010 NAS Report, Note 229, page 128.
---------------------------------------------------------------------------

    In addition to the high cost and limited utility of hybrids for 
many tractor drive cycles noted above, the agencies believe that hybrid 
powertrains systems for tractors may not be sufficiently developed and 
the necessary manufacturing capacity put in place to base a standard on 
any significant volume of hybrid tractors. Unlike hybrids for 
vocational vehicles and light-duty vehicles, the agencies are not aware 
of any full hybrid systems currently developed for long haul tractor 
applications. To date, hybrid systems for tractors have been primarily 
focused on extended idle shutdown technologies and not on the broader 
energy storage and recovery systems necessary to achieve reductions 
over typical tractor drive cycles. The Phase 2 sleeper cab tractor 
standards instead reflect the potential for extended idle shutdown 
technologies. Further, as highlighted by the 2010 NAS report, the 
agencies do believe that full hybrid powertrains may have the potential 
in the longer term to provide significant improvements in long haul 
tractor fuel efficiency and to greenhouse gas emission reductions. With 
respect to day cab tractors, the types of tractors that would receive 
the benefit from hybrid powertrains would be those such as beverage 
delivery tractors which could be treated as vocational vehicles through 
the Special Purpose Tractor provisions (40 CFR 1037.630).
    Several stakeholders commented on hybrid powertrain development for 
tractor applications. Allison agreed with the agencies' overall 
assessment of hybrids in tractors, as discussed in the

[[Page 73600]]

NPRM. Bendix agreed that hybrid systems for tractors have not been 
focused on. Bendix believed that mild hybrid systems should be included 
in GEM for credit, including stop-start and electrification of 
accessories. Daimler commented that in SuperTruck, a tractor that was 
tested on line haul-type highway routes, the hybrid system provided 
little benefit beyond what eCoast achieved because it competes with 
hybrids for energy that might be lost on hills. Overall, Daimler's view 
was that hybrid systems proved too costly relative to their benefit. 
Eaton stated that hybrids have not penetrated the commercial trucking 
landscape, primarily due to the costs but that there may be potential 
in the future for hybrids in tractor applications driven by improved 
aerodynamics and lower rolling resistance tires because it would lead 
to longer coasting times and higher braking loads, therefore greater 
regeneration opportunities. PACCAR commented that their history with 
hybrid technology was a niche market application appealing to ``green'' 
companies as long as incentives offset the cost of the technology. 
PACCAR stated that the low sales volumes were not based on performance, 
but rather on the combination of the payback of the high initial cost 
based on the limited number of gallons saved in low mileage pick up-
and-delivery applications and on the concern over resale value, since 
at some point in the vehicle's life the battery must be replaced at a 
significant cost to the owner.
    After considering the comments, the agencies are continuing the 
Phase 1 approach of not including hybrid powertrains in our feasibility 
analysis for Phase 2. Because the technology for tractor applications 
is still under development we cannot confidently assess the 
effectiveness of this technology at this point in time. In addition, 
due to the high cost, limited benefit during highway driving, and 
lacking any existing systems or manufacturing base, we cannot conclude 
that such technology will be available for tractors in the 2021-2027 
timeframe. However, manufacturers will be able to use powertrain 
testing to capture the performance of a hybrid system in GEM if systems 
are developed in the Phase 2 timeframe, so this technology remains a 
potential compliance option (without requiring an off-cycle 
demonstration).
(xii) Operational Management
    The 2010 NAS report noted many operational opportunities to reduce 
fuel consumption, such as driver training and route optimization. The 
agencies have included discussion of several of these strategies in RIA 
Chapter 2, but are not using these approaches or technologies in the 
Phase 2 standard setting process. The agencies are looking to other 
resources, such as EPA's SmartWay Transport Partnership and regulations 
that could potentially be promulgated by the Federal Highway 
Administration and the Federal Motor Carrier Safety Administration, to 
continue to encourage the development and utilization of these 
approaches. In addition, the agencies have also declined to base 
standard stringencies on technologies which are largely to chiefly 
driver-dependent, and evaluate such potential improvements through the 
off-cycle credit mechanism. See, e.g., 77 FR 62838/3 (Oct. 12, 2012).
(xiii) Consideration of Phase 1 Credits in Phase 2 Stringency Setting
    The agencies requested comment regarding the treatment of Phase 1 
credits, as discussed in Section I.C.1.b. See 80 FR 40251. As examples, 
the agencies discussed limiting the use of Phase 1 credits in Phase 2 
and factoring credit balances into the 2021 standards. Daimler 
commented that allowing Phase 1 credits in Phase 2 is necessary to 
smooth the transition into a new program that is very complex and that 
HD manufacturers cannot change over an entire product portfolio at one 
time. The agencies evaluated the status of Phase 1 credit balances in 
2015 by sector. For tractors, we found that manufacturers are 
generating significant credits, and that it appears that many of the 
credits result from their use of an optional provision for calculating 
aerodynamic drag. However, we also believe that manufacturers will 
generate fewer credits in MY 2017 and later when the final Phase 1 
standards begin. Still, the agencies believe that manufacturers will 
have significant credit balances available to them for MYs 2021-2023, 
and that much of these balances would be the result of the test 
procedure provisions rather than pull ahead of any technology. Based on 
confidential product plans for MYs 2017 and later, we expect this total 
windfall amount to be three percent of the MY 2021 standards or more. 
Therefore, the agencies are factoring in a total credit amount 
equivalent to this three percent credit (i.e. three years times 1 
percent per year). Thus, we are increasing the stringency of the 
CO2 and fuel consumption tractor standards for MYs 2021-2023 
by 1 percent to reflect these credits.
(xiv) Summary of Technology Performance
    Table III-10 describes the performance levels for the range of 
Class 7 and 8 tractor vehicle technologies.

                                                         Table III-10--Phase 2 Technology Inputs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Class 7                                                    Class 8
                                    --------------------------------------------------------------------------------------------------------------------
                                                    Day cab                                Day cab                              Sleeper cab
                                    --------------------------------------------------------------------------------------------------------------------
                                       Low roof     Mid roof    High roof     Low roof     Mid roof    High roof     Low roof     Mid roof    High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                          2021MY       2021MY       2021MY       2021MY       2021MY       2021MY       2021MY       2021MY       2021MY
                                      11L Engine   11L Engine   11L Engine   15L Engine   15L Engine   15L Engine   15L Engine   15L Engine   15L Engine
                                          350 HP       350 HP       350 HP       455 HP       455 HP       455 HP       455 HP       455 HP       455 HP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                Aerodynamics (CdA in m2)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin I..............................         6.00         7.00         7.45         6.00         7.00         7.45         6.00         7.00         7.15
Bin II.............................         5.60         6.65         6.85         5.60         6.65         6.85         5.60         6.65         6.55
Bin III............................         5.15         6.25         6.25         5.15         6.25         6.25         5.15         6.25         5.95
Bin IV.............................         4.75         5.85         5.70         4.75         5.85         5.70         4.75         5.85         5.40
Bin V..............................         4.40         5.50         5.20         4.40         5.50         5.20         4.40         5.50         4.90
Bin VI.............................         4.10         5.20         4.70         4.10         5.20         4.70         4.10         5.20         4.40
Bin VII............................         3.80         4.90         4.20         3.80         4.90         4.20         3.80         4.90         3.90
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 73601]]

 
                                                           Steer Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base...............................          7.8          7.8          7.8          7.8          7.8          7.8          7.8          7.8          7.8
Level 1............................          6.6          6.6          6.6          6.6          6.6          6.6          6.6          6.6          6.6
Level 2............................          5.7          5.7          5.7          5.7          5.7          5.7          5.7          5.7          5.7
Level 3............................          4.9          4.9          4.9          4.9          4.9          4.9          4.9          4.9          4.9
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Drive Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base...............................          8.1          8.1          8.1          8.1          8.1          8.1          8.1          8.1          8.1
Level 1............................          6.9          6.9          6.9          6.9          6.9          6.9          6.9          6.9          6.9
Level 2............................          6.0          6.0          6.0          6.0          6.0          6.0          6.0          6.0          6.0
Level 3............................          5.0          5.0          5.0          5.0          5.0          5.0          5.0          5.0          5.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Idle Reduction (% reduction)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Tamper Proof AESS..................          N/A          N/A          N/A          N/A          N/A          N/A            4            4            4
Tamper Proof AESS with Diesel APU..          N/A          N/A          N/A          N/A          N/A          N/A            4            4            4
Tamper Proof AESS with Battery APU.          N/A          N/A          N/A          N/A          N/A          N/A            6            6            6
Tamper Proof AESS with Automatic             N/A          N/A          N/A          N/A          N/A          N/A            3            3            3
 Stop-Start........................
Tamper Proof AESS with FOH.........          N/A          N/A          N/A          N/A          N/A          N/A            3            3            3
Adjustable AESS....................          N/A          N/A          N/A          N/A          N/A          N/A            1            1            1
Adjustable AESS with Diesel APU....          N/A          N/A          N/A          N/A          N/A          N/A            3            3            3
Adjustable AESS with Battery APU...          N/A          N/A          N/A          N/A          N/A          N/A            5            5            5
Adjustable AESS with Automatic Stop-         N/A          N/A          N/A          N/A          N/A          N/A            5            5            5
 Start.............................
Adjustable AESS with FOH...........          N/A          N/A          N/A          N/A          N/A          N/A            2            2            2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Transmission (% reduction)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Manual.............................            0            0            0            0            0            0            0            0            0
AMT................................            2            2            2            2            2            2            2            2            2
Auto...............................            2            2            2            2            2            2            2            2            2
Dual Clutch........................            2            2            2            2            2            2            2            2            2
Top Gear Direct Drive..............            2            2            2            2            2            2            2            2            2
Trans Efficiency...................            1            1            1            1            1            1            1            1            1
Neutral Idle.......................   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in
                                         GEM          GEM          GEM          GEM          GEM          GEM          GEM          GEM          GEM
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Driveline (% reduction)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Axle Efficiency....................            2            2            2            2            2            2            2            2            2
6x2, 6x4 Axle Disconnect or 4x2              N/A          N/A          N/A   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in
 Axle..............................                                             GEM          GEM          GEM          GEM          GEM          GEM
Downspeed..........................   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in   Modeled in
                                         GEM          GEM          GEM          GEM          GEM          GEM          GEM          GEM          GEM
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Accessory Improvements (% reduction)
--------------------------------------------------------------------------------------------------------------------------------------------------------
A/C Efficiency.....................          0.5          0.5          0.5          0.5          0.5          0.5          0.5          0.5          0.5
Electric Access....................            1            1            1            1            1            1            1            1            1
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Other Technologies (% reduction)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Predictive Cruise Control..........            2            2            2            2            2            2            2            2            2
Automated Tire Inflation System....          1.2          1.2          1.2          1.2          1.2          1.2          1.2          1.2          1.2
Tire Pressure Monitoring System....            1            1            1            1            1            1            1            1            1
Neutral Coast......................          1.5          1.5          1.5          1.5          1.5          1.5          1.5          1.5          1.5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
``Modeled in GEM'' means that a manufacturer will input information into GEM, such as ``Yes or No'' for neutral idle, and GEM will simulate that
  condition. The values listed in the table above as percentages reflect a post-processing done within GEM after the simulation runs the drive cycles.


[[Page 73602]]

(c) Tractor Technology Adoption Rates
    As explained above, tractor manufacturers often introduce major 
product changes together, as a package. In this manner the 
manufacturers can optimize their available resources, including 
engineering, development, manufacturing and marketing activities to 
create a product with multiple new features. Since Phase 1 began, this 
approach also has allowed manufacturers to consolidate testing and 
certification requirements. In addition, manufacturers recognize that a 
truck design will need to remain competitive over the intended life of 
the design and meet future regulatory requirements. In some limited 
cases, manufacturers may implement an individual technology outside of 
a vehicle's redesign cycle.
    With respect to the levels of technology adoption used to develop 
the HD Phase 2 standards, NHTSA and EPA established technology adoption 
constraints. The first type of constraint was established based on the 
application of fuel consumption and CO2 emission reduction 
technologies into the different types of tractors. For example, 
extended idle reduction technologies are limited to Class 8 sleeper 
cabs using the reasonable assumption that day cabs are not used for 
overnight hoteling. Day cabs typically idle for shorter durations 
throughout the day.
    A second type of constraint was applied to most other technologies 
and limited their adoption based on factors reflecting the real world 
operating conditions that some combination tractors encounter (so that 
the standards are not based on use of technologies which do not provide 
in-use benefit). This second type of constraint was applied to the 
aerodynamic, tire, powertrain, vehicle speed limiter technologies, and 
other technologies. NHTSA and EPA believe that within each of these 
individual vehicle categories there are particular applications where 
the use of the identified technologies will be either ineffective or 
not technically feasible. For example, the agencies are not predicating 
these standards on the use of full aerodynamic vehicle treatments on 
100 percent of tractors because we know that in some applications (for 
example, gravel trucks engaged in local delivery) the added weight of 
the aerodynamic technologies will increase fuel consumption and hence 
CO2 emissions to a greater degree than the reduction that 
will be accomplished from the more aerodynamic nature of the tractor. 
General considerations of needed lead time also play a significant role 
in the agencies' determination of technology adoption rates.
    In the development of the standards, we generally focused initially 
on what technology could be adopted in 2027 MY after ten years of lead 
time, consistent with the general principles discussed above. Based on 
our detailed discussions with manufacturers and technology suppliers, 
we can project that the vast majority of technologies will be fully 
developed and in widespread use by 2027 MY. (One notable exception to 
this is Rankine cycle waste heat recovery, which we project to be less 
widespread in 2027). Having identified what could be achieved in 2027 
MY, we projected technology steps for 2021 MY and 2024 MY to reflect 
the gradual development and deployment of these technologies.
    This is also consistent with how manufacturers will likely approach 
complying with these standards. In general, we would expect a 
manufacturer to first identify technology packages that would allow 
them to meet the 2027 MY standards, then to structure a development 
plan to make steady progress toward the 2027 MY standards. To some 
extent, it was easier to project the technology for 2027 MY, because it 
represents a maximum feasible adoption of most technologies. The 
agencies' projections for MYs 2021 and 2024 are less certain because 
they reflect choices manufacturers would likely make to reach the 2027 
levels. As such, we have more confidence that the levels of our MYs 
2021 and 2024 standards are appropriate than we do that each 
manufacturer will follow our specific technology development path in 
2021 MY or 2024 MY.
    Table III-13, Table III-14, and Table III-15 specify the adoption 
rates that EPA and NHTSA used to develop these standards.
(i) Aerodynamics Adoption Rate
    The impact of aerodynamics on a tractor-trailer's efficiency 
increases with vehicle speed. Therefore, the usage pattern of the 
vehicle will determine the benefit of various aerodynamic technologies. 
Sleeper cabs are often used in line haul applications and drive the 
majority of their miles on the highway travelling at speeds greater 
than 55 mph. The industry has focused aerodynamic technology 
development, including SmartWay tractors, on these types of trucks. 
Therefore the agencies proposed standards that reflect the most 
aggressive aerodynamic technology application rates to this regulatory 
subcategory, along with the high roof day cabs. 80 FR 40227. All of the 
major manufacturers today offer at least one SmartWay sleeper cab 
tractor model, which is represented as Bin III aerodynamic performance. 
The agencies requested comment on the proposed aerodynamic assessment.
    The agencies received significant comment from the manufacturers 
regarding our assessment of aerodynamics in the most aerodynamic bins 
for high roof sleeper cabs. EMA commented that the assumptions that 
Class 7 and Class 8 high-roof vehicles will achieve a 35 percent 
penetration rate into Bin V, a 20 percent penetration rate into Bin VI, 
and a 5 percent penetration rate into Bin VII by 2027 are over-stated 
and unreasonable. Volvo and EMA commented that it is impossible to 
achieve the targeted aerodynamic drag reductions that ultimately are 
predicated on 60 percent of tractors achieving aero bins V, VI, and 
VII. According to their analysis, the manufacturers stated that it is 
not possible to achieve these low drag levels with any tractor design 
coupled to the non-aerodynamic test trailer prescribed in this 
proposal. Caterpillar commented that given the proposed aerodynamic 
testing procedures, the Phase 2 test trailer, and the lack of any audit 
margin for these highly variable test processes, it is infeasible to 
design tractors that can achieve bin V, and so would not be able to 
achieve bins VI and VII. Caterpillar also stated that none of the 
vehicles developed within the Department of Energy's SuperTruck program 
are capable of meeting the proposed aerodynamic targets.
    In Phase 1, the agencies determined the stringency of the tractor 
standards through the use of a mix of aerodynamic bins in the 
technology packages. For example, we included 10 percent Bin II, 70 
percent Bin III, and 20 percent Bin IV in the high roof sleeper cab 
tractor standard. The weighted average aerodynamic performance of this 
technology package is equivalent to Bin III. 76 FR 57211. In 
consideration of the comments, the agencies have adjusted the 
aerodynamic adoption rate for Class 8 high roof sleeper cabs used to 
set the final standards in 2021, 2024, and 2027 MYs (i.e., the degree 
of technology adoption on which the stringency of the standard is 
premised). Upon further analysis of simulation modeling of a SuperTruck 
tractor with a Phase 2 reference trailer with skirts, we agree with the 
manufacturers that a SuperTruck tractor technology package would only 
achieve the Bin V level of CdA, as discussed above and in 
RIA Chapter 2.8.2.2. Consequently, as noted above, the final standards 
are not premised on any adoption of Bin VI and VII technologies. 
Accordingly, we

[[Page 73603]]

determined the adoption rates in the technology packages developed for 
the final rule using a similar approach as Phase 1--spanning three 
aerodynamic bins and not setting adoption rates in the most aerodynamic 
bin(s)--to reflect that there are some vehicles whose operation limits 
the applicability of some aerodynamic technologies. We set the MY 2027 
high roof sleeper cab tractor standards using a technology package that 
included 20 percent of Bin III, 30 percent Bin IV, and 50 percent Bin V 
reflecting our assessment of the fraction of high roof sleeper cab 
tractors that we project could successfully apply these aerodynamic 
packages with this amount of lead time. The weighted average of this 
set of adoption rates is equivalent to a tractor aerodynamic 
performance near the border between Bin IV and Bin V. We believe that 
there is sufficient lead time to develop aerodynamic tractors that can 
move the entire high roof sleeper cab aerodynamic performance to be as 
good as or better than today's SmartWay designated tractors.
    The agencies phased-in the aerodynamic technology adoption rates 
within the technology packages used to determine the MY 2021 and 2024 
standards so that manufacturers can gradually introduce these 
technologies. The changes required for Bin V performance reflect the 
kinds of improvements projected in the Department of Energy's 
SuperTruck program. That program has demonstrated tractor-trailers in 
2015 with significant aerodynamic technologies. For the final rule, the 
agencies are projecting that truck manufacturers will be able to begin 
implementing some of these aerodynamic technologies on high roof 
tractors as early as 2021 MY on a limited scale. For example, in the 
2021 MY technology package, the agencies have assumed that 10 percent 
of high roof sleeper cabs will have aerodynamics better than today's 
best tractors. This phase-in structure is consistent with the normal 
manner in which manufacturers introduce new technology to manage 
limited research and development budgets as well as to allow them to 
work with fleets to fully evaluate in-use reliability before a 
technology is applied fleet-wide. The agencies believe the phase-in 
schedule will allow manufacturers to complete these normal processes. 
Overall, while the agencies are now projecting slightly less benefit 
from aerodynamic improvements than we did in the NPRM, the actual 
aerodynamic technologies being projected are very similar to what was 
projected at the time of NPRM (however, these vehicles fall into Bin V 
in the final rule, instead of Bin VI and VII in the NPRM). Importantly, 
our averaging, banking and trading provisions provide manufacturers 
with the flexibility (and incentive) to implement these technologies 
over time even though the standard changes in a single step.
    The agencies also received comment regarding our aerodynamic 
assessment of the other tractor subcategories. Daimler commented that 
due to their shorter length, day cabs are more difficult to make 
aerodynamic than sleeper cabs, and that the bin boundaries and adoption 
rates should reflect this. EMA commented that the assumed aerodynamic 
performance improvements to be achieved by day cab and mid and low-roof 
vehicles are over-estimated by at least one bin. Daimler commented that 
the agencies should adjust the average bin down in recognition of the 
fact that mid/low-roof vehicles should have lower penetration rates of 
aerodynamic vehicles to reflect market needs, reflecting these 
vehicles' use in rough environments or in hauling non-aerodynamic 
trailers.
    Aerodynamic improvements through new tractor designs and the 
development of new aerodynamic components is an inherently slow and 
iterative process. The agencies recognize that there are tractor 
applications that require on/off-road capability and other truck 
functions which restrict the type of aerodynamic equipment applicable. 
We also recognize that these types of trucks spend less time at highway 
speeds where aerodynamic technologies have the greatest benefit. The 
2002 VIUS data ranks trucks by major use.\282\ The heavy trucks usage 
indicates that up to 35 percent of the trucks may be used in on/off-
road applications or heavier applications. The uses include 
construction (16 percent), agriculture (12 percent), waste management 
(5 percent), and mining (2 percent). Therefore, the agencies analyzed 
the technologies to evaluate the potential restrictions that will 
prevent 100 percent adoption of more advanced aerodynamic technologies 
for all of the tractor regulatory subcategories and developed standards 
with new penetration rates reflecting that these vehicles spend less 
time at highway speeds. For the final rule, the agencies evaluated the 
certification data to assess how the aerodynamic performance of high 
roof day cabs compare to high roof sleeper cabs. In 2014, the high roof 
day cabs on average are certified to one bin lower than the high roof 
sleeper cabs.\283\ Consistent with the public comments, and the 
certification data, the aerodynamic adoption rates used to develop the 
final Phase 2 standards for the high roof day cab regulatory 
subcategories are less aggressive than for the Class 8 sleeper cab high 
roof tractors. In addition, the agencies are also accordingly reducing 
the adoption rates in the highest bins for low and mid roof tractors to 
follow the changes made to the high roof subcategories because we 
neither proposed nor expect the aerodynamics of a low or mid roof 
tractor to be better than a high roof tractor.
---------------------------------------------------------------------------

    \282\ U.S. Department of Energy. Transportation Energy Data 
Book, Edition 28-2009. Table 5.7.
    \283\ U.S. EPA. Memo to Docket. Coefficient of Rolling 
Resistance and Coefficient of Drag Certification Data for Tractors. 
See Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

(ii) Low Rolling Resistance Tire Adoption Rate
    For the tire manufacturers to further reduce tire rolling 
resistance, the manufacturers must consider several performance 
criteria that affect tire selection. The characteristics of a tire also 
influence durability, traction control, vehicle handling, comfort, and 
retreadability. A single performance parameter can easily be enhanced, 
but an optimal balance of all the criteria will require improvements in 
materials and tread design at a higher cost, as estimated by the 
agencies. Tire design requires balancing performance, since changes in 
design may change different performance characteristics in opposing 
directions. Similar to the discussion regarding lesser aerodynamic 
technology application in tractor segments other than sleeper cab high 
roof, the agencies believe that the proposed standards should not be 
premised on 100 percent application of Level 3 tires in all tractor 
segments given the potential interference with vehicle utility that 
could result. 80 FR 40223.
    Several stakeholders commented about the level of rolling 
resistance used in setting the proposed level of tractor stringencies 
because the agencies used a single level for all tractor subcategories. 
ATA, First Industries, National Association of Manufacturers, PACCAR, 
Navistar and Daimler commented that the agencies erred by using the 
same rolling resistance for all types of day and sleeper cab tractors. 
They stated that the tire stringency levels should account for fleet 
and class variations and different duty-cycle needs. Caterpillar stated 
that tires need to meet demands of all conditions, including

[[Page 73604]]

unpaved roads, sloped loading docks which are frequently not treated in 
winter conditions. Caterpillar also stated that tire casings must have 
adequate durability to allow for as many as five retreads. NADA 
commented current LRRT tractor adoption rates are low and are not 
expected to increase significantly any time soon unless significant 
improvements in design are forthcoming and that there is no realistic 
means of ensuring that customers (or subsequent owners) will continue 
to use LRR tires. OOIDA commented that the LRR tire may be beneficial 
on flat terrain, but may pose a safety concern in many geographical 
regions. OOIDA also stated that a LRR tire achieves much of its 
potential fuel savings benefit by reducing the very component of 
friction or resistance that a truck driver may rely upon. PACCAR 
commented that customers with low- and mid-roof configurations 
typically operate more in urban areas where tires must withstand the 
abuse of curbs and other obstacles or in more on/off road conditions 
that are typical for flatbed, tanker, and low-boy operations, which use 
the low and mid-roof configuration vehicles. PACCAR stated that the 
tires for low and mid roof tractors vehicles are designed with 
additional side wall protection and generally have a higher coefficient 
of rolling resistance. Volvo commented with respect to tractor 
penetration and stringency setting the agencies show penetration of 
Level 3 tires starting in MY 2021. Volvo stated that they continue to 
hear customer feedback that low rolling resistance tires often lack 
adequate traction under many of the demanding conditions that trucks 
and tractors experience, such as snow and off-road. Schneider commented 
that fleet uses low rolling resistance tires on dual wheels for the 
majority of the standard fleet while using wide-based single tires for 
weight sensitive portions of the fleet. Schneider commented that 
regulations should not force the use of wide based single tires based 
solely on rolling resistance advantages without considering the overall 
performance because it may increase waste, the number of scrapped tire 
casings and landfill requirements. The commenter's view is that LRR 
dual tires are very comparable to wide based single tires (WBS) tires 
in fuel efficiency while providing better overall operating and 
economic efficiency.
    For the final rulemaking, the agencies evaluated the tire rolling 
resistance levels in the Phase 1 certification data.\284\ We found that 
high roof sleeper cabs are certified today with steer tire rolling 
resistance levels that ranged between 4.9 and 7.6 kg/ton and with drive 
tires ranging between 5.1 and 9.8 kg/ton. In the same analysis, we 
found that high roof day cabs are certified with rolling resistance 
levels ranging between 4.9 and 9.0 kg/ton for steer tires and between 
5.1 and 9.8 kg/ton for drive tires. This range spans the baseline 
through Level 3 rolling resistance performance levels. Therefore, for 
the final rule we took an approach similar to the one taken in Phase 1 
and proposed in Phase 2 that considers adoption rates across a wide 
range of tire rolling resistance levels to recognize that operators may 
have different needs. 76 FR 57211 and 80 FR 40227. The adoption rates 
for the technology packages used to determine the MY 2027 standards for 
each high roof tractor subcategory are shown in Table III-15.
---------------------------------------------------------------------------

    \284\ Memo to Docket. Coefficient of Rolling Resistance and 
Coefficient of Drag Certification Data for Tractors. Docket EPA-HQ-
OAR-2014-0827.
---------------------------------------------------------------------------

    In our analysis of the Phase 1 certification data, we found that 
the drive tires on low and mid roof sleeper cab tractors on average had 
10 to 17 percent higher rolling resistance than the high roof sleeper 
cabs. But we found only a minor difference in rolling resistance of the 
steer tires between the tractor subcategories. Based on comments 
received and further consideration of our own analysis of the 
difference in tire rolling resistance levels that exist today in the 
certification data, the agencies are adopting Phase 2 standards using a 
technology pathway that utilizes higher rolling resistance levels for 
low and mid roof tractors than the levels used to set the high roof 
tractor standards. This is also consistent with the approach that we 
took in setting the Phase 1 tractor standards. 76 FR 57211. In 
addition, the final rule reflects a reduction in Level 3 adoption rates 
for low and mid roof tractors from 25 percent in MY 2027 used at 
proposal (80 FR 40227) to zero percent adoption rate. The technology 
packages developed for the low and mid roof tractors used to determine 
the stringency of the MY 2027 standards in the final rule do not 
include any adoption rate of Level 3 drive tires to recognize the 
special needs of these applications, consistent with the comments noted 
above raising concerns about applications that limit the use of low 
rolling resistance tires.
    The agencies phased-in the low rolling resistance tire adoption 
rates within the technology packages used to determine the MY 2021 and 
2024 standards so that manufacturers can gradually introduce these 
technologies. In addition, the levels of rolling resistance used in all 
of the technology packages are achievable with either dual or wide 
based single tires, so the agencies are not forcing one technology over 
another. The adoption rates for the technology packages used to 
determine the MY 2021, 2024, and 2027 standards for each tractor 
subcategory are shown in Table III-13, Table III-14, and Table III-15.
(iii) Tire Pressure Monitoring and Automatic Tire Inflation System 
(ATIS) Adoption Rate
    The agencies used a 20 percent adoption rate of ATIS in MY 2021 and 
a 40 percent adoption rate in setting the proposed Phase 2 MY 2024 and 
2027 tractor standards. 80 FR 40227.
    ATA commented that as of 2012, roughly one percent of tractors used 
ATIS. Caterpillar and First Industries stated that the agencies should 
not force ATIS into the market by assuming any penetration rate. EMA 
commented that the assumption that 40 percent of all Class 7 and 8 
vehicles will utilize automated tire inflation systems lacked support 
and failed to account for the prevalence of tire inflation monitoring 
systems. NADA stated that they can support a 40 percent tractor 
adoption rate for MY 2027 if TPMS are considered. Volvo commented that 
given the poor reliability of past ATIS systems, they are skeptical of 
supplier's claims of current or future reliability improvements to 
these systems. Volvo stated that fleets are even more skeptical than 
truck OEMs, as an ATIS air leak results in increased fuel consumption 
due to a compressor cycling more frequently and also in potentially 
significant downtime of the vehicle. Volvo also commented that to 
incentivize truck operators to maintain tire pressure on vehicles 
equipped with a TPMS system, fleets have the ability to monitor fuel 
consumption remotely, including the ability to identify causes for 
increased fuel consumption which would be expected to motivate drivers 
to properly maintain tire pressure on TPMS equipped vehicles.
    The agencies find the comments related to a greater acceptance of 
TPMS in the tractor market to be persuasive. However, available 
information indicates that it is feasible to utilize either TPMS or 
ATIS to reduce the prevalence on underinflated tires in-use on all 
tractors. As a result, we are finalizing tractor standards that are 
predicated on the performance of a mix of TPMS and ATIS adoption rates 
in all tractor subcategories. The agencies are

[[Page 73605]]

using adoption rates of 30 percent of ATIS and 70 percent of TPMS in 
the technology packages used in setting the final Phase 2 MY 2027 
tractor standards. This represents a lower adoption rate of ATIS than 
used in the NPRM, but the agencies have added additional adoption rate 
of TPMS because none of the comments or available information disputed 
the ability to use it on all tractors. The agencies have developed 
technology packages for setting the 2021 and 2024 MY standards which 
reflect a phase in of adoption rates of each of these technologies. In 
2021 MY, the adoption rates consist of 20 percent TPMS and 20 percent 
ATIS. In 2024 MY, the adoption rates are 50 percent TPMS and 25 percent 
ATIS.
(iv) Idle Reduction Technology Adoption Rate
    Idle reduction technologies provide significant reductions in fuel 
consumption and CO2 emissions for Class 8 sleeper cabs and 
are available on the market today. There are several different 
technologies available to reduce idling. These include APUs, diesel 
fired heaters, and battery powered units. Our discussions with 
manufacturers prior to the Phase 2 NPRM indicated that idle 
technologies are sometimes installed in the factory, but that it is 
also a common practice to have the units installed after the sale of 
the truck. We want to continue to incentivize this practice and to do 
so in a manner that the emission reductions associated with idle 
reduction technology occur in use. We proposed to continue the Phase 1 
approach into Phase 2 where we recognize only idle emission reduction 
technologies that include a tamper-proof automatic engine shutoff 
system (AESS) with some override provisions.\285\ However, we welcomed 
comment on other approaches that will appropriately quantify the 
reductions that will be experienced in the real world. 80 FR 40224.
---------------------------------------------------------------------------

    \285\ The agencies are retaining the HD Phase 1 AESS override 
provisions included in 40 CFR 1037.660(b) for driver safety.
---------------------------------------------------------------------------

    We used an overall 90 percent adoption rate of tamper-proof AESS 
for Class 8 sleeper cabs in setting the proposed MY 2024 and 2027 
standards. Id. The agencies stated in the Phase 2 NPRM that we were 
unaware of reasons why AESS with extended idle reduction technologies 
could not be applied to this high fraction of tractors with a sleeper 
cab, except those deemed a vocational tractor, in the available lead 
time.
    EMA, Volvo, Daimler, and Navistar commented that the agencies 
should consider that customers are not accepting the tamper-proof AESS 
in Phase 1, therefore the adoption rates included in the proposal were 
too high and that resale concerns remain a significant issue for 
customers. PACCAR and EMA commented that the proposed 90 percent 
penetration rate of tamper-proof AESS is unachievable. Many comments 
also focused on the need for adjustable AESS. OOIDA commented that 90 
percent APU adoption is unreasonable and that the 400 pound weight 
exemption for APUs is not provided in California, Washington DC, 
Hawaii, Kentucky, Massachusetts, North Carolina, and Rhode Island. 
OOIDA also raised concerns about situations where an AESS could have 
negative consequences--such as team drivers where the co-driver was 
left asleep in the berth while the truck was shut off, or drivers with 
certain medical conditions, or pets.
    The agencies find the comments regarding the concerns for using 90 
percent adoption rates of tamper-proof AESS to be persuasive. For the 
final rule, the agencies developed a menu of idle reduction 
technologies that include both tamper-proof and adjustable AESS (as 
discussed in Section III.D.1.b) that are recognized at different levels 
of effectiveness in GEM. As discussed in the discussion of tractor 
baselines (Section III.D.1.a), the latest NACFE confidence report found 
that 96 percent of HD vehicles are equipped with adjustable automatic 
engine shutdown systems.\286\ Therefore, the agencies built this level 
of idle reduction into the baseline for sleeper cab tractors. Due to 
the high percentage acceptance of adjustable AESS today, the agencies 
project that by 2027 MY it is feasible for 100 percent of sleeper cabs 
to contain some type of AESS and idle reduction technology to meet the 
hoteling needs of the driver. However, we recognize that there are a 
variety of idle reduction technologies that meet the various needs of 
specific customers and not all customers will select diesel powered 
APUs due to the cost or weight concerns highlighted in the comments. 
Therefore, we developed an idle reduction technology package for each 
MY that reflects this variety. The idle reduction packages developed 
for the final rule contain lower AESS adoption rates than used at 
proposal. The AESS used during the NPRM assumed that it also included a 
diesel powered APU in terms of determining the effectiveness and costs. 
In the final rule, the idle reduction technology mix actually has an 
overall lower cost (even after increasing the diesel APU technology 
cost estimate for the final rule) than would have been developed for 
the final rule. In addition, the stringency of the tractor standards 
are not affected because the higher penetration rate of other idle 
reduction technologies, which are not quite as effective, but will be 
deployed more. We developed the technology package to set the 2027 MY 
sleeper cab tractor standards that includes 15 percent adoption rate of 
adjustable AESS only, 40 percent of adjustable AESS with a diesel 
powered APU, 15 percent adjustable AESS with a battery APU, 15 percent 
adjustable AESS with automatic stop/start, and 15 percent adjustable 
AESS with a fuel operated heater. We continued the same approach of 
phasing in different technology packages for the 2021 and 2024 MY 
standards, though we included some type of idle reduction on 100 
percent of the sleeper cab tractors. The 2021 MY technology package had 
a higher adoption rate of adjustable AESS with no other idle reduction 
technology and lower adoption rates of adjustable AESS with other idle 
reduction technologies. Details on the idle reduction technology 
adoption rates for the MY 2021 and 2024 standards are included in Table 
III-13 and Table III-14.
---------------------------------------------------------------------------

    \286\ North American Council for Freight Efficiency. Confidence 
Report: Idle-Reduction Solutions. 2014. Page 13.
---------------------------------------------------------------------------

(v) Transmission Adoption Rates
    The agencies' proposed standards included a 55, 80, and 90 percent 
adoption rate of automatic, automated manual, and dual clutch 
transmissions in MYs 2021, 2024, and 2027 respectively. 80 FR 40225-7. 
The agencies did not receive any comments regarding these proposed 
transmission adoption rates, and have not found any other information 
suggesting a change in approach. Therefore, we are including the same 
level of adoption rates in setting the final rule standards. The MY 
2021 and 2024 standards are likewise premised on the same adoption 
rates of these transmission technologies as at proposal.
    The agencies have added neutral idle as a technology input to GEM 
for Phase 2 in the final rulemaking. The TC10 that was tested by the 
agencies for the final rule included this technology. Therefore, we 
projected that neutral idle would be included in all of the automatic 
transmissions and therefore the adoption rates of neutral idle match 
the adoption rates of the automatic transmission in each of the MYs.
    Transmissions with direct drive as the top gear and numerically 
lower axles are

[[Page 73606]]

better suited for applications with primarily highway driving with flat 
or low rolling hills. Therefore, this technology is not appropriate for 
use in 100 percent of tractors. The agencies proposed standards 
reflected the projection that 50 percent of the tractors would have 
direct drive in top gear in MYs 2024 and 2027. 80 FR 40226-7. The 
agencies did not receive any comments regarding the adoption rates of 
transmissions with direct drive in those MYs. We therefore are 
including the same level of adoption rates in setting the final rule 
standards for MYs 2024 and 2027. Transmissions with direct drive top 
gears exist in the market today, therefore, the agencies determined it 
is feasible to also include this technology in the package for setting 
the 2021 MY standards. For the final rule, the agencies included a 20 
percent adoption rate of direct drive in the 2021 MY technology 
package.
    The agencies received comments supporting establishing a 
transmission efficiency test that measures the efficiency of each 
transmission gear and could be input into GEM. In the final rule, the 
agencies are adopting Phase 2 standards that project that 20, 40, and 
70 percent of the AMT and DCT transmissions will be tested and achieve 
a fuel consumption and CO2 emissions reduction of one 
percent in MYs 2021, 2024, and 2027, respectively.
    The adoption rates for the technology packages used to determine 
the MY 2021, 2024, and 2027 standards for each tractor subcategory are 
shown in Table III-13, Table III-14, and Table III-15.
(vi) Engine Downspeeding Adoption Rates
    The agencies proposed to include lower final drive ratios in 
setting the Phase 2 standards to account for engine downspeeding. In 
the NPRM, we used a transmission top gear ratio of 0.73 and baseline 
drive axle ratio of 3.70 in 2017 going down to a rear axle ratio of 
3.55 in 2021 MY, 3.36 in 2024 MY, and 3.20 in 2027 MY. 80 FR 40228-30.
    UCS commented that downspeeding was only partially captured as 
proposed. The agencies also received additional information from 
vehicle manufacturers and axle manufacturers that we believe supports 
using lower numerical drive axle ratios in setting the final Phase 2 
standards for sleeper cabs that spend more time on the highway than day 
cabs, directionally consistent with the UCS comment. For the final 
rules, the agencies have used 3.70 in the baseline and 3.16 for sleeper 
cabs and 3.21 for day cabs in MY 2027 to account for continued 
downspeeding opportunities. The final drive ratios used for setting the 
other model years are shown in Table III-11. These values represent the 
``average'' tractor in each of the MYs, but there will be a range of 
final drive ratios that contain more aggressive engine downspeeding on 
some tractors and less aggressive on others.

                         Table III-11--Final Drive Ratio for Tractor Technology Packages
----------------------------------------------------------------------------------------------------------------
                                                                                   Transmission
                           Model year                                Rear axle       top gear       Final drive
                                                                       ratio           ratio           ratio
----------------------------------------------------------------------------------------------------------------
                                                  Sleeper Cabs
----------------------------------------------------------------------------------------------------------------
2018............................................................            3.70            0.73            2.70
2021............................................................            3.31            0.73            2.42
2024............................................................            3.26            0.73            2.38
2027............................................................            3.16            0.73            2.31
----------------------------------------------------------------------------------------------------------------
                                                    Day Cabs
----------------------------------------------------------------------------------------------------------------
2018............................................................            3.70            0.73            2.70
2021............................................................            3.36            0.73            2.45
2024............................................................            3.31            0.73            2.42
2027............................................................            3.21            0.73            2.34
----------------------------------------------------------------------------------------------------------------

(vii) Drivetrain Adoption Rates
    The agencies' proposed standards included 6x2 axle adoption rates 
in high roof tractors of 20 percent in 2021 MY and 60 percent in MYs 
2024 and 2027. Because 6x2 axle configurations could raise concerns of 
traction, the agencies proposed standards that reflected lower adoption 
rates of 6x2 axles in low and mid roof tractors recognizing that these 
tractors may require some unique capabilities. The agencies proposed 
standards for low and mid roof tractors that included 6x2 axle adoption 
rates of 10 percent in MY 2021 and 20 percent in MYs 2024 and 2027. 80 
FR 40225-7.
    ATA and others commented that limitations to a high penetration 
rate of 6x2 axles include curb cuts, other uneven terrain features that 
could expose the truck to traction issues, lower residual values, 
traction issues, driver dissatisfaction, tire wear, and the legality of 
their use. The commenters stated that recent surveys indicate current 
market penetration rates of new line-haul 6x2 tractor sales are only in 
the range of two percent, according to a NACFE confidence report. The 
commenters also stated that while recent improvements in traction 
control systems can automatically shift weight for short periods of 
time from the non-driving axle to the driving axle during low-traction 
events, concerns remain over the impacts to highways caused by such 
shifting of weight between axles. EMA, ATA, OOIDA, Volvo, Daimler, 
PACCAR, First Industries, National Association of Manufacturers, 
Caterpillar, and others discussed that 6x2 axles are not legal in all 
U.S. states and Canadian provinces. Caterpillar and Daimler also stated 
the agencies should not assume more than 5 percent penetration rates of 
6x2 through 2027. EMA forecasts a 6x2 penetration rate of less than 5 
percent.
    Upon further consideration, the agencies have reduced the adoption 
rate of 6x2 axles and projected a 30 percent adoption rate in the 
technology package used to determine the Phase 2 2027 MY standards. The 
2021 MY standards include an adoption rate of 15 percent and the 2024 
MY standards include an adoption rate of 25 percent 6x2 axles. This 
adoption rate represents a combination of liftable 6x2 axles (which as 
noted in ATA's comments are allowed in all states but Utah, and Utah is 
expected to revise their law) and 4x2 axles. In addition, it is worth 
recognizing that state regulations related to 6x2 axles could change 
significantly

[[Page 73607]]

over the next ten years. It is also worth noting that the issue related 
to the legality of 6x2 axles was not mentioned as a barrier to adoption 
by fleets in the NACFE Confidence Report on 6x2 axles.\287\
---------------------------------------------------------------------------

    \287\ North American Council for Freight Efficiency. 
``Confidence Findings on the Potential of 6x2 Axles.'' 2014. Page 
16.
---------------------------------------------------------------------------

    In the NPRM, the agencies projected that 20 percent of 2021 MY and 
40 percent of the 2024 and 2027 MY axles would use low friction axle 
lubricants. 80 FR 40225-7. In the final rule, we are requiring that 
manufacturers conduct an axle efficiency test if they want to include 
the benefit of low friction lubricant or other axle design improvements 
when certifying in GEM. The axle efficiency test will be optional, but 
will allow manufacturers to reduce CO2 emissions and fuel 
consumption if the manufacturers have improved axle gear designs and/or 
mandatory use of low friction lubricants. The agencies' assessment of 
axle improvements found that 80 percent of the axles built in MY 2027 
could be two percent more efficient than a 2017 baseline axle. Because 
it will take time for axle manufacturers to make improvements across 
the majority of their product offerings, the agencies phased in the 
amount of axle efficiency improvements in the technology packages in 
setting the 2021 and 2024 MY standards to include 30 and 65 percent 
adoption rates, respectively.
(viii) Accessories and Other Technology Adoption Rates
    In the NPRM, the agencies projected adoption rates as show in Table 
III-12. 80 FR 40227. The agencies are adopting the same level of 
adoption rates for setting the final Phase 2 standards because we did 
not receive any comments or new data to support a change in the 
adoption rates used in the proposal.

                Table III-12--Adoption Rates Used in the Tractor Technology Packages in the NPRM
----------------------------------------------------------------------------------------------------------------
                                                                                              Higher efficiency
                  Model year                     Predictive  cruise        Electrified        air conditioning
                                                    control  (%)        accessories  (%)             (%)
----------------------------------------------------------------------------------------------------------------
2021..........................................                    20                    10                    10
2024..........................................                    40                    20                    20
2027..........................................                    40                    30                    30
----------------------------------------------------------------------------------------------------------------

(ix) Weight Reduction Technology Adoption Rates
    In the NPRM, the agencies proposed to allow manufacturers to use 
tractor weight reduction to comply with the standards. 80 FR 40223. A 
number of organizations commented generally in favor of the inclusion 
of light weight components for compliance, including the Aluminum 
Association, Meritor, American Die Casting Association, and the 
American Chemistry Council saying light-weight materials are durable 
and their use in heavy-duty vehicles can reduce weight and fuel 
consumption.
    Unlike in HD Phase 1, the agencies proposed the 2021 through 2027 
model year tractor standards without using weight reduction as a 
technology to demonstrate the feasibility of the standards. The ICCT 
stated that the agencies should include light weight components in 
setting the stringency of the standards, citing an ICCT tractor and 
trailer study showing specific light weight benefits for tractor 
components. Meritor argued that weight reduction should not be included 
in setting stringency, given the high cost to benefit ratio for weight 
reduction.
    The agencies view weight reduction as a technology with a high cost 
that offers a small benefit in the tractor sector. For example, our 
estimate of a 400 pound weight reduction will cost $2,050 (2012$) in 
2021 MY, but offers a 0.3 percent reduction in fuel consumption and 
CO2 emissions. The agencies are excluding the use of weight 
reduction components for the tractor stringency calculation due to the 
high cost associated with this technology. As noted above, Meritor in 
their comments expressed agreement with this approach.
(x) Vehicle Speed Limiter Adoption Rate
    Consistent with Phase 1, we proposed to continue the approach where 
vehicle speed limiters may be used as a technology to meet the Phase 2 
standard. See 80 FR 40224. In setting the Phase 2 proposed standard, 
however, we assumed a zero percent adoption rate of vehicle speed 
limiters. Although we expect there will be some use of VSL, currently 
it is used when the fleet involved decides it is feasible and 
practicable and increases the overall efficiency of the freight system 
for that fleet operator. To date, the compliance data provided by 
manufacturers indicate that none of the tractor configurations include 
a tamper-proof VSL setting less than 65 mph.
    At this point the agencies are not in a position to determine in 
how many additional situations use of a VSL will result in similar 
benefits to overall efficiency or how many customers will be willing to 
accept a tamper-proof VSL setting. Although we believe vehicle speed 
limiters are a simple, easy to implement, and inexpensive technology, 
we want to leave the use of vehicle speed limiters to the truck 
purchaser. In doing so, we are providing another means of meeting the 
standard that can lower compliance costs and provide a more optimal 
vehicle solution for some truck fleets or owners. For example, a local 
beverage distributor may operate trucks in a distribution network of 
primarily local roads. Under those conditions, aerodynamic fairings 
used to reduce aerodynamic drag provide little benefit due to the low 
vehicle speed while adding additional mass to the vehicle. A vehicle 
manufacturer could choose to install a VSL set at an optimized speed 
for its intended application and use this technology to assist in 
complying with our program all at a lower cost to the ultimate tractor 
purchaser.\288\
---------------------------------------------------------------------------

    \288\ Ibid.
    \288\ The agencies note that because a VSL value can be input 
into GEM, its benefits can be directly assessed with the model and 
off cycle credit applications therefore are not necessary even 
though the standard is not based on performance of VSLs (i.e. VSL is 
an on-cycle technology).
---------------------------------------------------------------------------

    We welcomed comment on whether the use of a VSL would require a 
fleet to deploy additional tractors, but did not receive responsive 
comment. ARB stated that if EPA and NHTSA decide to give credit in 
Phase 2 GEMs for VSLs, VSL benefit should also be reflected in the 
standard's stringency. Daimler supported the approach of not including 
VSLs in setting the stringency because of the resistance in the market 
to accept tamperproof VSLs. OOIDA commented that the agencies must 
consider the significant negative consequences of VSLs, such as safety 
impact from

[[Page 73608]]

differential speeds between light duty vehicles and trucks.
    After considering the comments, we still could not make a 
determination regarding the reasonableness of setting a standard based 
on a particular VSL adoption rate, for the same reasons articulated at 
proposal. Therefore, the agencies are not premising these final Phase 2 
standards on use of VSL, and instead will continue to rely on the 
industry to select VSL when circumstances are appropriate for its use 
(in which case there is an input in GEM reflecting VSL efficiency).
(d) Summary of the Adoption Rates Used To Determine the Final Phase 2 
Tractor Standards
    Table III-13 through Table III-16 provide the adoption rates of 
each technology broken down by weight class, cab configuration, and 
roof height.

                        Table III-13--Technology Adoption Rates for Class 7 and 8 Tractors for Determining the 2021 MY Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Class 7                                                    Class 8
                                    --------------------------------------------------------------------------------------------------------------------
                                                    Day cab                                Day cab                              Sleeper cab
                                    --------------------------------------------------------------------------------------------------------------------
                                       Low roof     Mid roof    High roof     Low roof     Mid roof    High roof     Low roof     Mid roof    High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                     2021 MY 11L  2021 MY 11L  2021 MY 11L  2021 MY 15L  2021 MY 15L  2021 MY 15L  2021 MY 15L  2021 MY 15L  2021 MY 15L
                                      engine 350   engine 350   engine 350   engine 455   engine 455   engine 455   engine 455   engine 455   engine 455
                                          HP           HP           HP           HP           HP           HP           HP           HP           HP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Aerodynamics
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin I..............................          10%          10%           0%          10%          10%           0%           0%          10%           0%
Bin II.............................          10%          10%           0%          10%          10%           0%          20%          10%           0%
Bin III............................          70%          70%          60%          70%          70%          60%          60%          70%          60%
Bin IV.............................          10%          10%          35%          10%          10%          35%          20%          10%          30%
Bin V..............................           0%           0%           5%           0%           0%           5%           0%           0%          10%
Bin VI.............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
Bin VII............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Steer Tires
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base...............................           5%           5%           5%           5%           5%           5%           5%           5%           5%
Level 1............................          35%          35%          35%          35%          35%          35%          35%          35%          35%
Level 2............................          50%          50%          50%          50%          50%          50%          50%          50%          50%
Level 3............................          10%          10%          10%          10%          10%          10%          10%          10%          10%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Drive Tires
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base...............................          15%          15%           5%          15%          15%           5%          15%          15%           5%
Level 1............................          35%          35%          35%          35%          35%          35%          35%          35%          35%
Level 2............................          50%          50%          50%          50%          50%          50%          50%          50%          50%
Level 3............................           0%           0%          10%           0%           0%          10%           0%           0%          10%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     Idle Reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
Tamper Proof AESS..................          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Diesel APU..          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Battery APU.          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Automatic             N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
 Stop-Start........................
Tamper Proof AESS with FOH.........          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Adjustable AESS....................          N/A          N/A          N/A          N/A          N/A          N/A          40%          40%          40%
Adjustable AESS with Diesel APU....          N/A          N/A          N/A          N/A          N/A          N/A          30%          30%          30%
Adjustable AESS with Battery APU...          N/A          N/A          N/A          N/A          N/A          N/A          10%          10%          10%
Adjustable AESS with Automatic Stop-         N/A          N/A          N/A          N/A          N/A          N/A          10%          10%          10%
 Start.............................
Adjustable AESS with FOH...........          N/A          N/A          N/A          N/A          N/A          N/A          10%          10%          10%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Transmission
--------------------------------------------------------------------------------------------------------------------------------------------------------
Manual.............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
AMT................................          40%          40%          40%          40%          40%          40%          40%          40%          40%
Auto...............................          10%          10%          10%          10%          10%          10%          10%          10%          10%
Dual Clutch........................           5%           5%           5%           5%           5%           5%           5%           5%           5%
Top Gear Direct Drive..............          20%          20%          20%          20%          20%          20%          20%          20%          20%
Trans. Efficiency..................          20%          20%          20%          20%          20%          20%          20%          20%          20%
Neutral Idle.......................          10%          10%          10%          10%          10%          10%          10%          10%          10%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Driveline
--------------------------------------------------------------------------------------------------------------------------------------------------------
Axle Efficiency....................          30%          30%          30%          30%          30%          30%          30%          30%          30%
6x2, 6x4 Axle Disconnect or 4x2              N/A          N/A          N/A          15%          15%          15%          15%          15%          15%
 Axle..............................
Downspeed (Rear Axle Ratio)........         3.36         3.36         3.36         3.36         3.36         3.36         3.31         3.31         3.31
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 73609]]

 
                                                                 Accessory Improvements
--------------------------------------------------------------------------------------------------------------------------------------------------------
A/C Efficiency.....................          10%          10%          10%          10%          10%          10%          10%          10%          10%
Electric Access....................          10%          10%          10%          10%          10%          10%          10%          10%          10%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Other Technologies
--------------------------------------------------------------------------------------------------------------------------------------------------------
Predictive Cruise Control..........          20%          20%          20%          20%          20%          20%          20%          20%          20%
Automated Tire Inflation System....          20%          20%          20%          20%          20%          20%          20%          20%          20%
Tire Pressure Monitoring System....          20%          20%          20%          20%          20%          20%          20%          20%          20%
Neutral Coast......................           0%           0%           0%           0%           0%           0%           0%           0%           0%
--------------------------------------------------------------------------------------------------------------------------------------------------------


                        Table III-14--Technology Adoption Rates for Class 7 and 8 Tractors for Determining the 2024 MY Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Class 7                                                    Class 8
                                    --------------------------------------------------------------------------------------------------------------------
                                                    Day cab                                Day cab                              Sleeper cab
                                    --------------------------------------------------------------------------------------------------------------------
                                       Low roof     Mid roof    High roof     Low roof     Mid roof    High roof     Low roof     Mid roof    High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                     2024 MY 11L  2024 MY 11L  2024 MY 11L  2024 MY 15L  2024 MY 15L  2024 MY 15L  2024 MY 15L  2024 MY 15L  2024 MY 15L
                                      engine 350   engine 350   engine 350   engine 455   engine 455   engine 455   engine 455   engine 455   engine 455
                                          HP           HP           HP           HP           HP           HP           HP           HP           HP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Aerodynamics
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin I..............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
Bin II.............................          20%          20%           0%          20%          20%           0%          20%          20%           0%
Bin III............................          60%          60%          40%          60%          60%          40%          60%          60%          40%
Bin IV.............................          20%          20%          40%          20%          20%          40%          20%          20%          40%
Bin V..............................           0%           0%          20%           0%           0%          20%           0%           0%          20%
Bin VI.............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
Bin VII............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Steer Tires
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base...............................           5%           5%           5%           5%           5%           5%           5%           5%           5%
Level 1............................          25%          25%          15%          25%          25%          15%          25%          25%          15%
Level 2............................          55%          55%          60%          55%          55%          60%          55%          55%          60%
Level 3............................          15%          15%          20%          15%          15%          20%          15%          15%          20%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Drive Tires
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base...............................          10%          10%           5%          10%          10%           5%          10%          10%           5%
Level 1............................          25%          25%          15%          25%          25%          15%          25%          25%          15%
Level 2............................          65%          65%          60%          65%          65%          60%          65%          65%          60%
Level 3............................           0%           0%          20%           0%           0%          20%           0%           0%          20%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     Idle Reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
Tamper Proof AESS..................          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Diesel APU..          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Battery APU.          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Automatic             N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
 Stop-Start........................
Tamper Proof AESS with FOH.........          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Adjustable AESS....................          N/A          N/A          N/A          N/A          N/A          N/A          30%          30%          30%
Adjustable AESS with Diesel APU....          N/A          N/A          N/A          N/A          N/A          N/A          40%          40%          40%
Adjustable AESS with Battery APU...          N/A          N/A          N/A          N/A          N/A          N/A          10%          10%          10%
Adjustable AESS with Automatic Stop-         N/A          N/A          N/A          N/A          N/A          N/A          10%          10%          10%
 Start.............................
Adjustable AESS with FOH...........          N/A          N/A          N/A          N/A          N/A          N/A          10%          10%          10%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Transmission
--------------------------------------------------------------------------------------------------------------------------------------------------------
Manual.............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
AMT................................          50%          50%          50%          50%          50%          50%          50%          50%          50%
Auto...............................          20%          20%          20%          20%          20%          20%          20%          20%          20%

[[Page 73610]]

 
Dual Clutch........................          10%          10%          10%          10%          10%          10%          10%          10%          10%
Top Gear Direct Drive..............          50%          50%          50%          50%          50%          50%          50%          50%          50%
Trans. Efficiency..................          40%          40%          40%          40%          40%          40%          40%          40%          40%
Neutral Idle.......................          20%          20%          20%          20%          20%          20%          20%          20%          20%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Driveline
--------------------------------------------------------------------------------------------------------------------------------------------------------
Axle Efficiency....................          65%          65%          65%          65%          65%          65%          65%          65%          65%
6x2, 6x4 Axle Disconnect or 4x2              N/A          N/A          N/A          25%          25%          25%          25%          25%          25%
 Axle..............................
Downspeed (Rear Axle Ratio)........         3.31         3.31         3.31         3.31         3.31         3.31         3.26         3.26         3.26
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Accessory Improvements
--------------------------------------------------------------------------------------------------------------------------------------------------------
A/C Efficiency.....................          20%          20%          20%          20%          20%          20%          20%          20%          20%
Electric Access....................          20%          20%          20%          20%          20%          20%          20%          20%          20%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Other Technologies
--------------------------------------------------------------------------------------------------------------------------------------------------------
Predictive Cruise Control..........          40%          40%          40%          40%          40%          40%          40%          40%          40%
Automated Tire Inflation System....          25%          25%          25%          25%          25%          25%          25%          25%          25%
Tire Pressure Monitoring System....          50%          50%          50%          50%          50%          50%          50%          50%          50%
Neutral Coast......................           0%           0%           0%           0%           0%           0%           0%           0%           0%
--------------------------------------------------------------------------------------------------------------------------------------------------------


                        Table III-15--Technology Adoption Rates for Class 7 and 8 Tractors for Determining the 2027 MY Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Class 7                                                    Class 8
                                    --------------------------------------------------------------------------------------------------------------------
                                                    Day cab                                Day cab                              Sleeper cab
                                    --------------------------------------------------------------------------------------------------------------------
                                       Low roof     Mid roof    High roof     Low roof     Mid roof    High roof     Low roof     Mid roof    High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                     2027 MY 11L  2027 MY 11L  2027 MY 11L  2027 MY 15L  2027 MY 15L  2027 MY 15L  2027 MY 15L  2027 MY 15L  2027 MY 15L
                                      Engine 350   Engine 350   Engine 350   Engine 455   Engine 455   Engine 455   Engine 455   Engine 455   Engine 455
                                          HP           HP           HP           HP           HP           HP           HP           HP           HP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Aerodynamics
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin I..............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
Bin II.............................          20%          20%           0%          20%          20%           0%          20%          20%           0%
Bin III............................          50%          50%          30%          50%          60%          30%          40%          50%          20%
Bin IV.............................          30%          30%          30%          30%          20%          30%          40%          30%          30%
Bin V..............................           0%           0%          40%           0%           0%          40%           0%           0%          50%
Bin VI.............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
Bin VII............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Steer Tires
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base...............................           5%           5%           5%           5%           5%           5%           5%           5%           5%
Level 1............................          20%          20%          10%          20%          20%          10%          20%          20%          10%
Level 2............................          50%          50%          50%          50%          50%          50%          50%          50%          50%
Level 3............................          25%          25%          35%          25%          25%          35%          25%          25%          35%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Drive Tires
--------------------------------------------------------------------------------------------------------------------------------------------------------
Base...............................           5%           5%           5%           5%           5%           5%           5%           5%           5%
Level 1............................          10%          10%          10%          10%          10%          10%          10%          10%          10%
Level 2............................          85%          85%          50%          85%          85%          50%          85%          85%          50%
Level 3............................           0%           0%          35%           0%           0%          35%           0%           0%          35%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     Idle Reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
Tamper Proof AESS..................          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Diesel APU..          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Battery APU.          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Tamper Proof AESS with Automatic             N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
 Stop-Start........................
Tamper Proof AESS with FOH.........          N/A          N/A          N/A          N/A          N/A          N/A           0%           0%           0%
Adjustable AESS....................          N/A          N/A          N/A          N/A          N/A          N/A          15%          15%          15%
Adjustable AESS with Diesel APU....          N/A          N/A          N/A          N/A          N/A          N/A          40%          40%          40%

[[Page 73611]]

 
Adjustable AESS with Battery APU...          N/A          N/A          N/A          N/A          N/A          N/A          15%          15%          15%
Adjustable AESS with Automatic Stop-         N/A          N/A          N/A          N/A          N/A          N/A          15%          15%          15%
 Start.............................
Adjustable AESS with FOH...........          N/A          N/A          N/A          N/A          N/A          N/A          15%          15%          15%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Transmission
--------------------------------------------------------------------------------------------------------------------------------------------------------
Manual.............................           0%           0%           0%           0%           0%           0%           0%           0%           0%
AMT................................          50%          50%          50%          50%          50%          50%          50%          50%          50%
Auto...............................          30%          30%          30%          30%          30%          30%          30%          30%          30%
Dual Clutch........................          10%          10%          10%          10%          10%          10%          10%          10%          10%
Top Gear Direct Drive..............          50%          50%          50%          50%          50%          50%          50%          50%          50%
Trans. Efficiency..................          70%          70%          70%          70%          70%          70%          70%          70%          70%
Neutral Idle.......................          30%          30%          30%          30%          30%          30%          30%          30%          30%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Driveline
--------------------------------------------------------------------------------------------------------------------------------------------------------
Axle Efficiency....................          80%          80%          80%          80%          80%          80%          80%          80%          80%
6x2, 6x4 Axle Disconnect or 4x2              N/A          N/A          N/A          30%          30%          30%          30%          30%          30%
 Axle..............................
Downspeed (Rear Axle Ratio)........         3.21         3.21         3.21         3.21         3.21         3.21         3.16         3.16         3.16
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Accessory Improvements
--------------------------------------------------------------------------------------------------------------------------------------------------------
A/C Efficiency.....................          30%          30%          30%          30%          30%          30%          30%          30%          30%
Electric Access....................          30%          30%          30%          30%          30%          30%          30%          30%          30%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Other Technologies
--------------------------------------------------------------------------------------------------------------------------------------------------------
Predictive Cruise Control..........          40%          40%          40%          40%          40%          40%          40%          40%          40%
Automated Tire Inflation System....          30%          30%          30%          30%          30%          30%          30%          30%          30%
Tire Pressure Monitoring System....          70%          70%          70%          70%          70%          70%          70%          70%          70%
Neutral Coast......................           0%           0%           0%           0%           0%           0%           0%           0%           0%
--------------------------------------------------------------------------------------------------------------------------------------------------------

(e) Adoption Rates Used To Set the Heavy-Haul Tractor Standards
    The agencies recognize that certain technologies used to determine 
the stringency of the Phase 2 tractor standards are less applicable to 
heavy-haul tractors. Heavy-haul tractors are not typically used in the 
same manner as long-haul tractors with extended highway driving, and 
therefore will experience less benefit from aerodynamics. Aerodynamic 
technologies are very effective at reducing the fuel consumption and 
GHG emissions of tractors, but only when traveling at highway speeds. 
At lower speeds, the aerodynamic technologies may have a detrimental 
impact due to the potential of added weight. The agencies therefore 
proposed not considering the use of aerodynamic technologies in the 
development of the Phase 2 heavy-haul tractor standards. Moreover, 
because aerodynamics will not play a role in the heavy-haul standards, 
the agencies proposed to combine all of the heavy-haul tractor cab 
configurations (day and sleeper) and roof heights (low, mid, and high) 
into a single heavy-haul tractor subcategory. We welcomed comment on 
this approach. 80 FR 40233.
    The agencies received comments regarding the applicability of 
aerodynamic technologies on heavy-haul vehicles. Daimler commented that 
heavy-haul vehicles are designed to meet high cooling needs, therefore 
have large radiators and grilles, and are not designed primarily for 
hauling standard trailers on the highway. Daimler also stated that 
these vehicles are designed to operate off-road or on difficult 
terrain, which also limits the application of aerodynamic fairings, and 
that requiring aerodynamic improvements on these vehicles, may 
compromise the vehicles' work. EMA supported the agencies' proposed 
approach of not requiring the use of aerodynamic technologies as a 
component of the proposed Phase 2 heavy-haul tractor standards. EMA 
stated that those vehicles are already quite heavy (by virtue of need), 
are designed to meet high-cooling needs (thus having, for example, 
large grilles), and generally are not designed for hauling standard 
trailers on highways. EMA also stated that those vehicles are often 
designed to be capable of operation off-road or on difficult terrain. 
Volvo supported the addition of a heavy-haul subcategory since heavy-
haul tractors require large engines and increased cooling capacity that 
limits aerodynamic improvements. Volvo also stated the most heavy-haul 
rigs have some requirement for off-road access to pick up machinery, 
bulk goods, and unusual loads that also inhibit aerodynamic 
improvements. These comments largely echo the agencies' own concerns 
voiced at proposal. After considering these comments, the agencies are 
using a technology package that does not use aerodynamic improvements 
in setting the Phase 2 heavy-haul tractor standards, as we 
proposed.\289\
---------------------------------------------------------------------------

    \289\ Since aerodynamic improvements are not part of the 
technology package, the agencies likewise are not adopting any aero 
bin structure for the heavy-haul tractor subcategory.
---------------------------------------------------------------------------

    Certain powertrain and drivetrain components are also impacted 
during the design of a heavy-haul tractor,

[[Page 73612]]

including the transmission, axles, and the engine. Heavy-haul tractors 
typically require transmissions with 13 or 18 speeds to provide the 
ratio spread to ensure that the tractor is able to start pulling the 
load from a stop. Downspeed powertrains are typically not an option for 
heavy-haul operations because these vehicles require more torque to 
move the vehicle because of the heavier load. Finally, due to the 
loading requirements of the vehicle, it is not likely that a 6x2 axle 
configuration can be used in heavy-haul applications. We requested 
comments on all aspects of our heavy-haul tractor technology packages. 
80 FR 40233.
    We received comments from stakeholders about the application of 
technologies other than aerodynamics for heavy-haul tractors. Daimler 
commented that the low rolling resistance levels in the NPRM are overly 
aggressive because heavy-haul tractors require unusually high traction 
and stopping power. Daimler agreed with the agencies' assessment in the 
NPRM that did not include weight reduction because these vehicles 
require strong frames and axles to carry heavy loads. Volvo commented 
that heavy-haul tractors would not likely be able to utilize current 
SmartWay tires; would see no benefit from predictive cruise; sometimes 
utilize an auxiliary transmission for further reduction or closer 
ratios; and nearly all heavy-haul tractors have deeper drive axle 
ratios than the agencies assumed in the NPRM. After considering these 
comments and the information regarding the tire rolling resistance 
improvement opportunities, discussed in Section III.D.1.b.iii, the 
agencies have adjusted the adoption rate of low rolling resistance 
tires. Consistent with the changes made in the final rule for the 
adoption of low rolling resistance tires in low and mid roof tractors, 
the agencies did not project any adoption of Level 3 tires for heavy-
haul tractors in the final rule.
    Allison commented that AMTs in the NPRM receive a 1.8 percent 
credit in GEM for heavy-haul tractors, yet there is no similar credit 
for ATs. Allison commented that since ATs offer similar, if not 
greater, benefits, they should also receive credit and that neutral-
idle recognition should be available. The final version of Phase 2 GEM 
treats ATs and AMTs the same for heavy-haul tractors as for the other 
tractors.
    The agencies used the following heavy-haul tractor adoption rates 
for developing the final Phase 2 2021, 2024, and 2027 MY standards, as 
shown in Table III-16.

                        Table III-16--Application Rates for Heavy-Haul Tractor Standards
                                     [Heavy-haul tractor application rates]
----------------------------------------------------------------------------------------------------------------
                                               2021 MY                  2024 MY                  2027 MY
                                      --------------------------------------------------------------------------
                Engine                 2021 MY 15L engine with  2024 MY 15L engine with  2027 MY 15L engine with
                                            600 HP with 2%          600 HP with 4.2%         600 HP with 5.4%
                                        reduction over 2018 MY   reduction over 2018 MY   reduction over 2018 MY
----------------------------------------------------------------------------------------------------------------
                                                Aerodynamics--0%
----------------------------------------------------------------------------------------------------------------
                                                   Steer Tires
----------------------------------------------------------------------------------------------------------------
Phase 1 Baseline:                                          15%                      10%                       5%
    Level I..........................                      35%                      30%                      10%
    Level 2..........................                      50%                      60%                      85%
    Level 3..........................                       0%                       0%                       0%
----------------------------------------------------------------------------------------------------------------
                                                   Drive Tires
----------------------------------------------------------------------------------------------------------------
Phase 1 Baseline:                                          15%                      10%                       5%
    Level I..........................                      35%                      30%                      10%
    Level 2..........................                      50%                      60%                      85%
    Level 3..........................                       0%                       0%                       0%
----------------------------------------------------------------------------------------------------------------
                                                  Transmission
----------------------------------------------------------------------------------------------------------------
AMT..................................                      40%                      50%                      50%
Automatic with Neutral Idle..........                      10%                      20%                      20%
DCT..................................                       5%                      10%                      10%
----------------------------------------------------------------------------------------------------------------
                                               Other Technologies
----------------------------------------------------------------------------------------------------------------
6x2 Axle.............................                       0%                       0%                       0%
Transmission Efficiency..............                      20%                      40%                      70%
Axle Efficiency......................                      30%                      65%                      80%
Predictive Cruise Control............                      20%                      40%                      40%
Accessory Improvements...............                      10%                      20%                      20%
Air Conditioner Efficiency                                 10%                      20%                      20%
 Improvements........................
Automatic Tire Inflation Systems.....                      20%                      25%                      30%
Tire Pressure Monitoring System......                      20%                      50%                      70%
----------------------------------------------------------------------------------------------------------------

    The agencies are also adopting in Phase 2 provisions that allow the 
manufacturers to meet an optional heavy Class 8 tractor standard that 
reflects both aerodynamic improvements, along with the powertrain 
requirements that go along with higher GCWR. Table III-17 reflects the 
adoption rates for each of the technologies for each of the 
subcategories in MY 2021. The technology packages closely reflect those 
in the primary Class 8 tractor program. The exceptions include less 
aggressive targets for low rolling

[[Page 73613]]

resistance tires, no 6x2 axle adoption rates, and no downspeeding due 
to the heavier loads of these vehicles.

        Table III-17--Adoption Rates Used To Develop the 2021 MY Optional Heavy Class 8 Tractor Standards
                           [Optional heavy class 8 tractor application rates--2021 MY]
----------------------------------------------------------------------------------------------------------------
                                                   Low/mid roof    High roof day   Low/mid roof      High roof
                                                      day cab           cab         sleeper cab     sleeper cab
                                                 ---------------------------------------------------------------
                     Engine                         2021 MY 15L     2021 MY 15L     2021 MY 15L     2021 MY 15L
                                                    Engine with     Engine with     Engine with     Engine with
                                                      600 HP          600 HP          600 HP          600 HP
----------------------------------------------------------------------------------------------------------------
                                                  Aerodynamics
----------------------------------------------------------------------------------------------------------------
Bin I...........................................             10%              0%             10%              0%
Bin II..........................................             10%              0%             10%              0%
Bin III.........................................             70%             60%             70%             60%
Bin IV..........................................             10%             35%             10%             30%
Bin V...........................................              0%              5%              0%             10%
Bin VI..........................................              0%              0%              0%              0%
Bin VII.........................................              0%              0%              0%              0%
----------------------------------------------------------------------------------------------------------------
                                                   Steer Tires
----------------------------------------------------------------------------------------------------------------
Phase 1 Baseline                                             10%              5%             10%              5%
Level I.........................................             25%             35%             25%             35%
Level 2.........................................             65%             60%             65%             60%
Level 3.........................................              0%              0%              0%              0%
----------------------------------------------------------------------------------------------------------------
                                                   Drive Tires
----------------------------------------------------------------------------------------------------------------
Phase 1 Baseline                                             20%             10%             20%             10%
Level I.........................................             40%             30%             40%             30%
Level 2.........................................             40%             60%             40%             60%
Level 3.........................................              0%              0%              0%              0%
----------------------------------------------------------------------------------------------------------------
                                                  Transmission
----------------------------------------------------------------------------------------------------------------
AMT.............................................             40%             40%             40%             40%
Automatic with Neutral Idle.....................             10%             10%             10%             10%
DCT.............................................              5%              5%              5%              5%
----------------------------------------------------------------------------------------------------------------
                                               Other Technologies
----------------------------------------------------------------------------------------------------------------
Adjustable AESS w/Diesel APU....................             N/A             N/A             30%             30%
Adjustable AESS w/Battery APU...................             N/A             N/A             10%             10%
Adjustable AESS w/Automatic Stop-Start..........             N/A             N/A             10%             10%
Adjustable AESS w/FOH Cold, Main Engine Warm....             N/A             N/A             10%             10%
Adjustable AESS programmed to 5 minutes.........             N/A             N/A             40%             40%
Transmission Efficiency.........................             20%             20%             20%             20%
Axle Efficiency.................................             30%             30%             30%             30%
Predictive Cruise Control.......................             20%             20%             20%             20%
Accessory Improvements..........................             10%             10%             10%             10%
Air Conditioner Efficiency Improvements.........             10%             10%             10%             10%
Automatic Tire Inflation Systems................             20%             20%             20%             20%
Tire Pressure Monitoring System.................             20%             20%             20%             20%
----------------------------------------------------------------------------------------------------------------

(f) Derivation of the Final Phase 2 Tractor Standards
    The agencies used the technology effectiveness inputs and 
technology adoption rates to develop GEM inputs to derive the HD Phase 
2 fuel consumption and CO2 emissions standards for each 
subcategory of Class 7 and 8 combination tractors. Note that we have 
analyzed one technology pathway for each level of stringency, but 
manufacturers will be free to use any combination of technology to meet 
the standards, as well as the flexibility of averaging, banking and 
trading, to meet the standard on average. The agencies derived a 
scenario tractor for each subcategory by weighting the individual GEM 
input parameters included in Table III-7 with the adoption rates in 
Table III-8 through Table III-10. For example, the CdA value 
for a 2021 MY Class 8 Sleeper Cab High Roof scenario case was derived 
as 60 percent times 5.95 plus 30 percent times 5.40 plus 10 percent 
times 4.90, which is equal to a CdA of 5.68 m\2\. Similar 
calculations were made for tire rolling resistance, transmission types, 
idle reduction, and other technologies. The agencies developed fuel 
maps that achieved the CO2 emissions and fuel consumption 
reductions described in Section III.D.1.b. The agencies then ran GEM 
with a single set of vehicle inputs, as shown in Table III-18 through 
Table III-21, to derive the final standards for each subcategory. 
Additional detail is provided in the RIA Chapter 2.8.4.

[[Page 73614]]



                                     Table III-18--GEM Inputs for the 2021 MY Class 7 and 8 Tractor Standard Setting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Class 7                                                                      Class 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Day cab                                            Day cab                                          Sleeper cab
--------------------------------------------------------------------------------------------------------------------------------------------------------
    Low roof          Mid roof        High roof         Low roof         Mid roof        High roof         Low roof         Mid roof        High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
2021 MY 11L         2021 MY 11L      2021 MY 11L      2021 MY 15L      2021 MY 15L      2021 MY 15L      2021 MY 15L      2021 MY 15L      2021 MY 15L
 Engine 350 HP     Engine 350 HP    Engine 350 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Aerodynamics (CdA in m\2\)
--------------------------------------------------------------------------------------------------------------------------------------------------------
         5.24             6.33             6.01             5.24             6.33             6.01             5.24             6.33             5.68
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Steer Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
          6.0              6.0              6.0              6.0              6.0              6.0              6.0              6.0              6.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Drive Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
          6.6              6.6              6.3              6.6              6.6              6.3              6.6              6.6              6.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Extended Idle Reduction Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
          N/A              N/A              N/A              N/A              N/A              N/A             2.3%             2.3%             2.3%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Transmission = 10 speed Manual Transmission
                                        Gear Ratios = 12.8, 9.25, 6.76, 4.90, 3.58, 2.61, 1.89, 1.38, 1.00, 0.73
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Drive Axle Ratio = 3.36 for day cabs, 3.31 for sleeper cabs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             6x2 Axle Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
          N/A              N/A              N/A             0.3%             0.3%             0.3%             0.3%             0.3%             0.3%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Transmission Type Weighted Effectiveness = 1.1%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Neutral Idle Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
         0.1%             0.1%             0.1%             0.1%             0.1%             0.1%            0.02%            0.02%            0.02%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Direct Drive Weighted Effectiveness = 0.4%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Transmission Efficiency Weighted Effectiveness = 0.2%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Axle Efficiency Improvement = 0.6%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Air Conditioner Efficiency Improvements = 0.1%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Accessory Improvements = 0.1%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Predictive Cruise Control = 0.4%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Automatic Tire Inflation Systems = 0.3%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Tire Pressure Monitoring System = 0.2%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Phase 1 Credit Carry-over = 1%
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 73615]]


                                     Table III-19--GEM Inputs for the 2024 MY Class 7 and 8 Tractor Standard Setting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Class 7                                                                      Class 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Day cab                                            Day cab                                          Sleeper cab
--------------------------------------------------------------------------------------------------------------------------------------------------------
    Low roof          Mid roof        High roof         Low roof         Mid roof        High roof         Low roof         Mid roof        High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
2024 MY 11L        2024 MY 11L      2024 MY 11L      2024 MY 15L      2024 MY 15L      2024 MY 15L      2024 MY 15L      2024 MY 15L      2024 MY 15L
 Engine 350 HP    Engine 350 HP    Engine 350 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Aerodynamics (CdA in m\2\)
--------------------------------------------------------------------------------------------------------------------------------------------------------
         5.16             6.25             5.82             5.16             6.25             5.82             5.16             6.25             5.52
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Steer Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
          5.9              5.9              5.8              5.9              5.9              5.8              5.9              5.9              5.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Drive Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
          6.4              6.4              6.0              6.4              6.4              6.0              6.4              6.4              6.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Extended Idle Reduction Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
          N/A              N/A              N/A              N/A              N/A              N/A             2.5%             2.5%             2.5%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Transmission = 10 speed Manual Transmission
                                        Gear Ratios = 12.8, 9.25, 6.76, 4.90, 3.58, 2.61, 1.89, 1.38, 1.00, 0.73
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Drive Axle Ratio = 3.31 for day cabs, 3.26 for sleeper cabs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             6x2 Axle Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
          N/A              N/A              N/A             0.5%             0.5%             0.5%             0.5%             0.5%             0.5%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Transmission Type Weighted Effectiveness = 1.6%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Neutral Idle Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
         0.2%             0.2%             0.2%             0.2%             0.2%             0.2%            0.03%            0.03%            0.03%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Direct Drive Weighted Effectiveness = 1.0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Transmission Efficiency Weighted Effectiveness = 0.4%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Axle Efficiency Improvement = 1.3%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Air Conditioner Efficiency Improvements = 0.1%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Accessory Improvements = 0.2%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Predictive Cruise Control = 0.8%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                Automatic Tire Inflation
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Tire Pressure Monitoring System = 0.5%
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 73616]]


                                     Table III-20--GEM Inputs for the 2027 MY Class 7 and 8 Tractor Standard Setting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Class 7                                                                      Class 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Day cab                                            Day cab                                          Sleeper cab
--------------------------------------------------------------------------------------------------------------------------------------------------------
    Low roof          Mid roof        High roof         Low roof         Mid roof        High roof         Low roof         Mid roof        High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
2027 MY 11L        2027 MY 11L      2027 MY 11L      2027 MY 15L      2027 MY 15L      2027 MY 15L      2027 MY 15L      2027 MY 15L      2027 MY 15L
 Engine 350 HP    Engine 350 HP    Engine 350 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP    Engine 455 HP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Aerodynamics (CdA in m\2\)
--------------------------------------------------------------------------------------------------------------------------------------------------------
         5.12             6.21             5.67             5.12             6.21             5.67             5.08             6.21             5.26
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Steer Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
          5.8              5.8              5.6              5.8              5.8              5.6              5.8              5.8              5.6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Drive Tires (CRR in kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
          6.2              6.2              5.8              6.2              6.2              5.8              6.2              6.2              5.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Extended Idle Reduction Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
          N/A              N/A              N/A              N/A              N/A              N/A               3%               3%               3%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Transmission = 10 speed Manual Transmission
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                        Gear Ratios = 12.8, 9.25, 6.76, 4.90, 3.58, 2.61, 1.89, 1.38, 1.00, 0.73
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Drive Axle Ratio = 3.21 for day cabs, 3.16 for sleeper cabs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             6x2 Axle Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
          N/A              N/A              N/A             0.6%             0.6%             0.6%             0.6%             0.6%             0.6%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Transmission Type Weighted Effectiveness = 1.6%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Neutral Idle Weighted Effectiveness
--------------------------------------------------------------------------------------------------------------------------------------------------------
         0.2%             0.2%             0.2%             0.2%             0.2%             0.2%            0.03%            0.03%            0.03%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Direct Drive Weighted Effectiveness = 1.0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Transmission Efficiency Weighted Effectiveness = 0.7%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Axle Efficiency Improvement = 1.6%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Air Conditioner Efficiency Improvements = 0.3%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Accessory Improvements = 0.2%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Predictive Cruise Control = 0.8%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Automatic Tire Inflation Systems = 0.4%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Tire Pressure Monitoring System = 0.7%
--------------------------------------------------------------------------------------------------------------------------------------------------------


 Table III-21--GEM Inputs for 2021, 2024 and 2027 MY Heavy-Haul Tractor
                                Standards
------------------------------------------------------------------------
           2021 MY                   2024 MY               2027 MY
------------------------------------------------------------------------
Engine = 2021 MY 15L Engine   Engine = 2024 MY 15L  Engine = 2027 MY 15L
 with 600 HP.                  Engine with 600 HP.   Engine with 600 HP.
------------------------------------------------------------------------
                    Aerodynamics (CdA in m\2\) = 5.00
------------------------------------------------------------------------
Steer Tires (CRR in kg/       Steer Tires (CRR in   Steer Tires (CRR in
 metric ton) = 6.2.            kg/metric ton) =      kg/metric ton) =
                               6.0.                  5.8.
Drive Tires (CRR in kg/       Drive Tires (CRR in   Drive Tires (CRR in
 metric ton) = 6.6.            kg/metric ton) =      kg/metric ton) =
                               6.4.                  6.2.
Transmission = 18 speed       Transmission = 18     Transmission = 18
 Manual Transmission.          speed Manual          speed Manual
                               Transmission.         Transmission.
Drive axle Ratio = 3.70.....  Drive axle Ratio =    Drive axle Ratio =
                               3.70.                 3.70.
6x2 Axle Weighted             6x2 Axle Weighted     6x2 Axle Weighted
 Effectiveness = 0%.           Effectiveness = 0%.   Effectiveness = 0%.
Transmission benefit = 1.1%.  Transmission benefit  Transmission benefit
                               = 1.8%.               = 1.8%.

[[Page 73617]]

 
Transmission Efficiency =     Transmission          Transmission
 0.2%.                         Efficiency = 0.4%.    Efficiency = 0.7%.
Axle Efficiency = 0.3%......  Axle Efficiency =     Axle Efficiency =
                               0.7%.                 1.6%.
Predictive Cruise Control =   Predictive Cruise     Predictive Cruise
 0.4%.                         Control = 0.8%.       Control = 0.8%.
Accessory Improvements =      Accessory             Accessory
 0.1%.                         Improvements = 0.2%.  Improvements =
                                                     0.3%.
Air Conditioner Efficiency    Air Conditioner       Air Conditioner
 Improvements = 0.1%.          Efficiency            Efficiency
                               Improvements = 0.1%.  Improvements =
                                                     0.2%.
Automatic Tire Inflation      Automatic Tire        Automatic Tire
 Systems = 0.3%.               Inflation Systems =   Inflation Systems =
                               0.3%.                 0.4%.
Tire Pressure Monitoring      Tire Pressure         Tire Pressure
 System = 0.2%.                Monitoring System =   Monitoring System =
                               0.5%.                 0.7%.
------------------------------------------------------------------------

    The agencies ran GEM with a single set of vehicle inputs, as shown 
in Table III-22, to derive the optional standards for each subcategory 
of the Heavy Class 8 tractors (see Section III.C.(4)(a)).

                  Table III-22--GEM Inputs for 2021 MY Optional Heavy Class 8 Tractor Standards
                                     [Heavy Class 8 GEM inputs for 2021 MY]
----------------------------------------------------------------------------------------------------------------
                        Day cab                                                Sleeper cab
----------------------------------------------------------------------------------------------------------------
     Low roof           Mid roof          High roof           Low roof           Mid roof          High roof
----------------------------------------------------------------------------------------------------------------
                                            2021 MY 15L Engine 600 HP
----------------------------------------------------------------------------------------------------------------
                                           Aerodynamics (CdA in m \2\)
----------------------------------------------------------------------------------------------------------------
            5.2                6.3                6.0                5.2                6.3                5.7
----------------------------------------------------------------------------------------------------------------
                                       Steer Tires (CRR in kg/metric ton)
----------------------------------------------------------------------------------------------------------------
            6.1                6.1                6.1                6.1                6.1                6.1
----------------------------------------------------------------------------------------------------------------
                                       Drive Tires (CRR in kg/metric ton)
----------------------------------------------------------------------------------------------------------------
            6.8                6.8                6.5                6.8                6.8                6.5
----------------------------------------------------------------------------------------------------------------
                                 Extended Idle Reduction Weighted Effectiveness
----------------------------------------------------------------------------------------------------------------
            N/A                N/A                N/A               2.3%               2.3%               2.3%
----------------------------------------------------------------------------------------------------------------
                                   Transmission = 18 speed Manual Transmission
----------------------------------------------------------------------------------------------------------------
                                             Drive Axle Ratio = 3.73
----------------------------------------------------------------------------------------------------------------
                                 Transmission Type Weighted Effectiveness = 1.1%
----------------------------------------------------------------------------------------------------------------
                                       Neutral Idle Weighted Effectiveness
----------------------------------------------------------------------------------------------------------------
       0.1%                   0.1%               0.1%               0.1%               0.1%               0.1%
----------------------------------------------------------------------------------------------------------------
                                   Direct Drive Weighted Effectiveness = 0.4%
----------------------------------------------------------------------------------------------------------------
                              Transmission Efficiency Weighted Effectiveness = 0.2%
----------------------------------------------------------------------------------------------------------------
                                       Axle Efficiency Improvement = 0.6%
----------------------------------------------------------------------------------------------------------------
                                 Air Conditioner Efficiency Improvements = 0.1%
----------------------------------------------------------------------------------------------------------------
                                          Accessory Improvements = 0.1%
----------------------------------------------------------------------------------------------------------------
                                        Predictive Cruise Control = 0.4%
----------------------------------------------------------------------------------------------------------------
                                     Automatic Tire Inflation Systems = 0.3%
----------------------------------------------------------------------------------------------------------------
                                     Tire Pressure Monitoring System = 0.2%
----------------------------------------------------------------------------------------------------------------

    The level of the final Phase 2 2027 model year standards, and the 
phase-in standards in model years 2021 and 2024 for each subcategory, 
is shown in Table III-23.

[[Page 73618]]



                  Table III-23--Final Phase 2 2021, 2024, and 2027 Model Year Tractor Standards
----------------------------------------------------------------------------------------------------------------
                                                              Day cab               Sleeper cab     Heavy-haul
                                                 ---------------------------------------------------------------
                                                      Class 7         Class 8         Class 8         Class 8
----------------------------------------------------------------------------------------------------------------
                                  2021 Model Year CO[ihel2] Grams per Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................           105.5            80.5            72.3            52.4
Mid Roof........................................           113.2            85.4            78.0
High Roof.......................................           113.5            85.6            75.7
----------------------------------------------------------------------------------------------------------------
                               2021 Model Year Gallons of Fuel per 1,000 Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................        10.36346         7.90766         7.10216         5.14735
Mid Roof........................................        11.11984         8.38900         7.66208
High Roof.......................................        11.14931         8.40864         7.43615
----------------------------------------------------------------------------------------------------------------
                                  2024 Model Year CO[ihel2] Grams per Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................            99.8            76.2            68.0            50.2
Mid Roof........................................           107.1            80.9            73.5
High Roof.......................................           106.6            80.4            70.7
----------------------------------------------------------------------------------------------------------------
                          2024 Model Year and Later Gallons of Fuel per 1,000 Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         9.80354         7.48527         6.67976         4.93124
Mid Roof........................................        10.52063         7.94695         7.22004
High Roof.......................................        10.47151         7.89784         6.94499
----------------------------------------------------------------------------------------------------------------
                                2027 Model Year CO[ihel2] Grams per Ton-Mile \a\
----------------------------------------------------------------------------------------------------------------
Low Roof........................................            96.2            73.4            64.1            48.3
Mid Roof........................................           103.4            78.0            69.6
High Roof.......................................           100.0            75.7            64.3
----------------------------------------------------------------------------------------------------------------
                          2027 Model Year and Later Gallons of Fuel per 1,000 Ton-Mile
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         9.44990         7.21022         6.29666         4.74460
Mid Roof........................................        10.15717         7.66208         6.83694
High Roof.......................................         9.82318         7.43615         6.31631
----------------------------------------------------------------------------------------------------------------
Note:
\a\ The 2027 MY high roof tractor standards include a 0.3 m\2\ reduction in CdA as described in Section
  III.E.2.a.vii.

    The level of the Phase 2 2027 model year optional Heavy Class 8 
standards is shown in Table III-24.

                             Table III-24--Phase 2 Optional Heavy Class 8 Standards
                                   [Optional heavy Class 8 tractor standards]
----------------------------------------------------------------------------------------------------------------
                                                          Low roof sleeper   Mid roof sleeper  High roof sleeper
 Low roof day cab   Mid roof day cab  High roof day cab         cab                cab                cab
----------------------------------------------------------------------------------------------------------------
                            2021 Model Year CO[ihel2] Standards (Grams per Ton-Mile)
----------------------------------------------------------------------------------------------------------------
           51.8               54.1               54.1               45.3               47.9               46.9
----------------------------------------------------------------------------------------------------------------
                     2021 MY and Later Fuel Consumption (Gallons of Fuel per 1,000 Ton-Mile)
----------------------------------------------------------------------------------------------------------------
        5.08841            5.31434            5.31434            4.44990            4.70530            4.60707
----------------------------------------------------------------------------------------------------------------

(g) Technology Costs of the Final Phase 2 Tractor Standards
    A summary of the technology package costs is included in Table III-
15 through Table III-17 for MYs 2021, 2024, and 2027, respectively, 
with additional details available in the RIA Chapter 2.12.
    The agencies received several comments related to the APU, tire, 
and aerodynamic technology costs used by the agencies at proposal. As 
noted in Section III.C.3 above, ATA, First Industries, and Daimler 
commented that APU costs are substantially higher than the figures in 
the proposal. PACCAR commented that the cost of a diesel or battery-
based APU is $8,570 to $11,263. EMA commented that the direct per-
chassis cost of a diesel APU is approximately $8,500-$10,100 and 
approximately $11,300 for battery/electric APUs. Volvo commented that 
APU prices can vary between $9,500 and $11,000 depending on the type. 
Schneider commented that an electronic APU will have an initial cost of 
at least $5,000 and engine powered APUs are 2 to 3 times the electric 
costs.

[[Page 73619]]

    EPA considered the comments and more closely evaluated NHTSA's 
contracted TetraTech cost report found the retail price of a diesel-
powered APU with a DPF to be $10,000.\290\ The agencies used a retail 
price of a diesel-powered APU to be $8,000 without a DPF and $10,000 
with a DPF in the cost analysis for this final rulemaking.
---------------------------------------------------------------------------

    \290\ U.S. DOT/NHTSA. Commercial Medium- and Heavy-Duty Truck 
Fuel Efficiency Technology Cost Study. May 2015. Page 71.
---------------------------------------------------------------------------

    ATA and First Industries commented that the LRR tire costs 
calculations appear to be based on calculations on 1999 data indexed 
for inflation. Michelin's comments stated that they estimate the cost 
of low rolling resistance tires to be about $25 per tire. ATA commented 
that the industry commonly sees a 40 percent reduction in useful life 
and a 20 percent reduction in casing life resulting from low rolling 
resistance tires. ATA and First Industries commented that the LRR tire 
costs do not account for reduced tire life resulting in fewer retreads. 
Schneider commented that WBS tire costs must include additional service 
costs, cost of reduced tire life, and increased replacement tire costs 
due to recaps not available, and reduced resale value. Volvo also 
commented that heavy-duty fleets expect to retread tires as many as 
five times and have concerns that tire casing durability may be 
compromised with low rolling resistance tires. Volvo stressed that 
retreading saves cost and about two thirds of the oil required to 
produce a new tire.
    We have estimated the cost of lower rolling resistance tires based 
on an estimate from TetraTech of $30 (retail, 2013$). We also have 
applied a ``medium'' complexity markup value for the more advanced low 
rolling resistance tires. We expect that, when replaced, the lower 
rolling resistance tires would be replaced by equivalent performing 
tires throughout the vehicle lifetime. As such, the incremental 
increases in costs for lower rolling resistance tires would be incurred 
throughout the vehicle lifetime at intervals consistent with current 
tire replacement intervals. A recent study conducted by ATA's 
Technology and Maintenance Council found through surveys of 51 fleets 
that low rolling resistance tires and wide base single tires lasted 
longer than standard tractor tires.\291\ Due to the uncertainty 
regarding the life expectancy of the LRR tires, we maintained the 
current tire replacement intervals in our cost analysis.
---------------------------------------------------------------------------

    \291\ Truckinginfo. TMC Survey Reveals Misinformed View of Fuel-
Efficient Tires. March 2015.
---------------------------------------------------------------------------

    ATA and First Industries commented that the estimated costs of 
future aerodynamic devices appear low given the historical nature of 
the proposed changes. ATA and First Industries also commented that the 
agencies should describe in detail the component packages they expect 
to satisfy each bin level, cost breakdowns of these individual 
components, and how this technology will be modified over time to 
maintain compliance with increasingly stringency levels. The agencies 
included the technology cost of aerodynamic improvements, such as wheel 
covers and active grill shutters, in RIA Chapter 2.11.
    The agencies also received comments associated with other costs 
that should be considered related to the technologies, specifically 6x2 
axle configurations, tire pressure monitoring and inflation system, and 
APUs. ATA and First Industries commented that the agencies should 
include additional tire wear and negative residual values associated 
with 6x2 axles. Schneider commented that 6x2 axle configurations cost 
should include loss on resale value, increased tire wear, and cost for 
electronic technology to improve traction. ATA and First Industries 
commented that the cost estimates for tire inflation systems and TPMS 
must include warranty limitations, useful life, maintenance and 
replacement costs, as well as costs of false warnings and increased 
operation of the air compressor. Doran cited a FMCSA study that found 
TPMS and ATIS reduce road calls for damaged tires and reduced number of 
tire replacements and did not introduce unscheduled maintenance. 
Schneider commented that an electronic APU will have maintenance of 
$500 per year and engine powered APUs must also include maintenance 
costs. Caterpillar requested that the agencies take a total cost of 
ownership approach when considering the technology feasibility and 
adoption rates.
    With respect to costs, all of the agencies' technology cost 
analyses include both direct and indirect costs. Indirect costs include 
items such as warranty. In terms of maintenance, the presence of tire 
inflation management systems, should serve to improve tire maintenance 
intervals and perhaps reduce vehicle downtime due to tire issues; they 
may also carry with them some increased maintenance costs to ensure 
that the tire inflation systems themselves remain in proper operation. 
For the analysis, we have considered these two competing factors to 
cancel each other out. The agencies also considered the maintenance 
impact of 6x2 axles. As noted in the NACFE Confidence Report on 6x2 
axles, the industry expects an overall reduction in maintenance costs 
and labor for vehicles with a 6x2 configuration as compared to a 6x4 
configuration.\292\ Among other savings, the reduction in number of 
parts, such as the interaxle drive shaft, will reduce the number of 
lubrication procedures needed and reduce the overall quantity of 
differential fluid needed at change intervals. The agencies have taken 
an approach to the maintenance costs for the 6x2 technology where we 
believe that the overall impact will be zero. The agencies added 
maintenance costs for diesel powered APUs, battery powered APUs, and 
diesel fired heaters into the cost analysis for the final rulemaking, 
as described in RIA Chapter 7.2.3. In response to Caterpillar's 
comment, the agencies considered the total cost of ownership during the 
payback calculations, included in RIA Chapter 7 of the final rule. The 
payback calculations include the hardware costs of the new technologies 
and their associated fixed costs, increased insurance, taxes, and 
maintenance. The agencies found that for each category of vehicle--
tractor/trailers, vocational vehicles, and HD pickups and vans--
included in the Phase 2 rule that the fuel savings significantly exceed 
the costs associated with the technologies over the lifetime of the 
vehicles.
---------------------------------------------------------------------------

    \292\ North American Council for Freight Efficiency. Confidence 
Findings on the Potential of 6x2 Axles. 2014.

[[Page 73620]]



          Table III-25--Class 7 and 8 Tractor Technology Incremental Costs in the 2021 Model Year \a\ \b\ Final Standard vs. the Flat Baseline
                                                                   [2013$ per vehicle]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Class 7                                                 Class 8
                                         ---------------------------------------------------------------------------------------------------------------
                                                      Day cab                         Day cab                               Sleeper cab
                                         ---------------------------------------------------------------------------------------------------------------
                                           Low/mid roof      High roof     Low/mid roof      High roof       Low roof        Mid roof        High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
Engine \c\..............................            $284            $284            $284            $284            $284            $284            $284
Aerodynamics............................             164             299             164             299             119             119             349
Tires...................................              39               9              61              16              61              56              16
Tire inflation system...................             259             259             300             300             300             300             300
Transmission............................           4,096           4,096           4,096           4,096           4,096           4,096           4,096
Axle Efficiency.........................              71              71             101             101             101             101             101
Idle reduction..........................               0               0               0               0           1,998           1,998           1,909
Air conditioning........................              17              17              17              17              17              17              17
Other vehicle technologies..............             204             204             204             204             204             204             204
                                         ---------------------------------------------------------------------------------------------------------------
    Total...............................           5,134           5,240           5,228           5,317           7,181           7,175           7,276
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ Costs shown are for the 2021 model year and are incremental to the costs of a baseline tractor meeting the Phase 1 standards. These costs include
  indirect costs via markups along with learning impacts. For a description of the markups and learning impacts considered in this analysis and how it
  impacts technology costs for other years, refer to Chapter 2 of the RIA (see RIA 2.12).
\b\ Note that values in this table include adoption rates. Therefore, the technology costs shown reflect the average cost expected for each of the
  indicated tractor classes. To see the actual estimated technology costs exclusive of adoption rates, refer to Chapter 2 of the RIA (see RIA 2.12 in
  particular).
\c\ Engine costs are for a heavy HD diesel engine meant for a combination tractor. The engine costs in this table are equal to the engine costs
  associated with the separate engine standard because both include the same set of engine technologies (see Section II.D.2.d.i).


       Table III-26--Class 7 and 8 Tractor Technology Incremental Costs in the 2024 Model Year \a\ \b\ Preferred Alternative vs. the Flat Baseline
                                                                   [2013$ per vehicle]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Class 7                                                 Class 8
                                         ---------------------------------------------------------------------------------------------------------------
                                                      Day cab                         Day cab                               Sleeper cab
                                         ---------------------------------------------------------------------------------------------------------------
                                           Low/mid roof      High roof     Low/mid roof      High roof       Low roof        Mid roof        High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
Engine \c\..............................            $712            $712            $712            $712            $712            $712            $712
Aerodynamics............................             264             465             264             465             217             217             467
Tires...................................              40              12              65              20              65              65              20
Tire inflation system...................             383             383             477             477             477             477             477
Transmission............................           6,092           6,092           6,092           6,092           6,092           6,092           6,092
Axle Efficiency.........................             139             139             185             185             185             185             185
Idle reduction..........................               0               0               0               0           2,946           2,946           2,946
Air conditioning........................              32              32              32              32              32              32              32
Other vehicle technologies..............             374             374             374             374             374             374             374
                                         ---------------------------------------------------------------------------------------------------------------
    Total...............................           8,037           8,210           8,201           8,358          11,100          11,100          11,306
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ Costs shown are for the 2024 model year and are incremental to the costs of a baseline tractor meeting the Phase 1 standards. These costs include
  indirect costs via markups along with learning impacts. For a description of the markups and learning impacts considered in this analysis and how it
  impacts technology costs for other years, refer to Chapter 2 of the RIA (see RIA 2.12).
\b\ Note that values in this table include adoption rates. Therefore, the technology costs shown reflect the average cost expected for each of the
  indicated tractor classes. To see the actual estimated technology costs exclusive of adoption rates, refer to Chapter 2 of the RIA (see RIA 2.12).
\c\ Engine costs are for a heavy HD diesel engine meant for a combination tractor. The engine costs in this table are equal to the engine costs
  associated with the separate engine standard because both include the same set of engine technologies (see Section II.D.2.d.i).


       Table III-27--Class 7 and 8 Tractor Technology Incremental Costs in the 2027 Model Year \a\ \b\ Preferred Alternative vs. the Flat Baseline
                                                                   [2013$ per vehicle]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Class 7                                                 Class 8
                                         ---------------------------------------------------------------------------------------------------------------
                                                      Day cab                         Day cab                               Sleeper cab
                                         ---------------------------------------------------------------------------------------------------------------
                                           Low/mid roof      High roof     Low/mid roof      High roof       Low roof        Mid roof        High roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
Engine \c\..............................          $1,579          $1,579          $1,579          $1,579          $1,579          $1,579          $1,579
Aerodynamics............................             453             547             453             547             415             415             639

[[Page 73621]]

 
Tires...................................              43              12              70              20              70              70              20
Tire inflation system...................             469             469             594             594             594             594             594
Transmission............................           7,098           7,098           7,098           7,098           7,098           7,098           7,098
Axle Efficiency.........................             168             168             220             220             220             220             220
Idle reduction..........................               0               0               0               0           3,134           3,173           3,173
Air conditioning........................              45              45              45              45              45              45              45
Other vehicle technologies..............             380             380             380             380             380             380             380
                                         ---------------------------------------------------------------------------------------------------------------
    Total...............................          10,235          10,298          10,439          10,483          13,535          13,574          13,749
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ Costs shown are for the 2027 model year and are incremental to the costs of a baseline tractor meeting the Phase 1 standards. These costs include
  indirect costs via markups along with learning impacts. For a description of the markups and learning impacts considered in this analysis and how it
  impacts technology costs for other years, refer to Chapter 2 of the RIA (see RIA 2.12).
\b\ Note that values in this table include adoption rates. Therefore, the technology costs shown reflect the average cost expected for each of the
  indicated tractor classes. To see the actual estimated technology costs exclusive of adoption rates, refer to Chapter 2 of the RIA (see RIA 2.12 in
  particular).
\c\ Engine costs are for a heavy HD diesel engine meant for a combination tractor. The engine costs in this table are equal to the engine costs
  associated with the separate engine standard because both include the same set of engine technologies (see Section II.D.2.d.i).

    The technology costs associated with the heavy-haul tractor 
standards are shown below in Table III-28.

  Table III-28--Heavy-Haul Tractor Technology Incremental Costs in the 2021, 2024, and 2027 Model Year \a\ \b\
                                   Preferred Alternative vs. the Flat Baseline
                                               [2013$ per vehicle]
----------------------------------------------------------------------------------------------------------------
                                                                      2021 MY         2024 MY         2027 MY
----------------------------------------------------------------------------------------------------------------
Engine \c\......................................................            $284            $712          $1,579
Tires...........................................................              61              65              70
Tire inflation system...........................................             300             477             594
Transmission....................................................           4,096           6,092           7,098
Axle Efficiency.................................................             101             185             220
Air conditioning................................................              17              32              45
Other vehicle technologies......................................             204             374             380
                                                                 -----------------------------------------------
    Total.......................................................           5,063           7,937           9,986
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Costs shown are for the specified model year and are incremental to the costs of a baseline tractor meeting
  the Phase 1 standards. These costs include indirect costs via markups along with learning impacts. For a
  description of the markups and learning impacts considered in this analysis and how it impacts technology
  costs for other years, refer to Chapter 2 of the RIA (see RIA 2.12).
\b\ Note that values in this table include adoption rates. Therefore, the technology costs shown reflect the
  average cost expected for each of the indicated tractor classes. To see the actual estimated technology costs
  exclusive of adoption rates, refer to Chapter 2 of the RIA (see RIA 2.12 in particular).
\c\ Engine costs are for a heavy HD diesel engine meant for a combination tractor.

(2) Consistency of the Tractor Standards With the Agencies' Legal 
Authority
    The HD Phase 2 standards are based on adoption rates for 
technologies that the agencies regard as the maximum feasible for 
purposes of EISA Section 32902(k) and appropriate under CAA section 
202(a) for the reasons given in Section III.D.1(b) through (d) above; 
see also RIA Chapter 2.8. The agencies believe these technologies can 
be adopted at the estimated rates for these standards within the lead 
time provided, as discussed above and in RIA Chapter 2.8. The 2021 and 
2024 MY standards are phase-in standards on the path to the 2027 MY 
standards and were developed using less aggressive application rates 
and therefore have lower technology package costs than the 2027 MY 
standards. Moreover, we project the cost of these technologies will be 
rapidly recovered by operators due to the associated fuel savings, as 
shown in the payback analysis included in Section IX below. The cost 
per tractor to meet the 2027 MY standards is projected to range between 
$10,200 and $13,700 (which includes the cost of the engine standards). 
See Table III-25 above. Much or all of this will be recovered in the 
form of fuel savings during the first two years of ownership. The 
agencies note that while the projected costs per vehicle are 
significantly greater than the costs projected for Phase 1, we still 
consider that cost to be reasonable, especially given the relatively 
short payback

[[Page 73622]]

period. In this regard the agencies note that the estimated payback 
period for tractors of less than two years,\293\ is itself shorter than 
the estimated payback period for light duty trucks in the 2017-2025 
light duty greenhouse gas standards. That period was slightly over 
three years, see 77 FR 62926-62927, which EPA found to be a highly 
reasonable given the usual period of ownership of light trucks is 
typically five years.\294\ The same is true here. Ownership of new 
tractors is customarily four to six years, meaning that the greenhouse 
gas and fuel consumption technologies pay for themselves early on and 
the purchaser sees overall savings in succeeding years--while still 
owning the vehicle.\295\ The agencies note further that the costs for 
each subcategory are relatively proportionate; that is, costs of any 
single tractor subcategory are not disproportionately higher (or lower) 
than any other. Although the rule is technology-forcing (especially 
with respect to aerodynamic and drivetrain efficiency improvements), 
the agencies believe that manufacturers retain leeway to develop 
alternative compliance paths, increasing the likelihood of the 
standards' successful implementation. The agencies also regard these 
reductions as cost-effective, even without considering payback period. 
The agencies estimate the cost per metric ton of CO2eq 
reduction without considering fuel savings to be $36 for tractor-
trailers in 2030 which compares favorably with the levels of cost 
effectiveness the agencies found to be reasonable for light duty 
trucks.296 297 See 77 FR 62922. The phase-in 2021 and 2024 
MY standards are less stringent and less costly than the 2027 MY 
standards and hence likewise reasonable. For these reasons, and because 
the agencies have carefully considered lead time and shown that lead 
time is adequate, EPA believes they are also reasonable under Section 
202(a) of the CAA. Given that the agencies believe these standards are 
technically feasible, are highly cost effective, and even more highly 
cost effective when accounting for the fuel savings, and have no 
apparent adverse potential impacts (e.g., there are no projected 
negative impacts on safety or vehicle utility, and EPA has taken steps 
to avoid adverse collateral consequences from use of APUs without 
filter-based particulate controls), these standards represent a 
reasonable choice under Section 202(a)(2) of the CAA and the maximum 
feasible under NHTSA's EISA authority at 49 U.S.C. 32902(k)(2).
---------------------------------------------------------------------------

    \293\ See RIA Chapter 7.2.4.
    \294\ Auto Remarketing. Length of Ownership Returning to More 
Normal Levels; New Registrations Continue Slow Climb. April 1, 2013. 
Last accessed on February 26, 2015 at http://www.autoremarketing.com/trends/length-ownership-returning-more-normal-levels-new-registrations-continue-slow-climb.
    \295\ North American Council for Freight Efficiency. Barriers to 
Increased Adoption of Fuel Efficiency Technologies in Freight 
Trucking. July 2013. Page 24.
    \296\ See RIA Chapter 7.2.5 and Memo to Docket ``Tractor-Trailer 
Cost per Ton Values.'' July 2016. EPA-HQ-OAR-2014-0827.
    \297\ If using a cost effectiveness metric that treats fuel 
savings as a negative cost, net costs per ton of GHG emissions 
reduced or per gallon of avoided fuel consumption will be negative 
under these standards.
---------------------------------------------------------------------------

(3) Alternative Tractor Standards Considered
    The agencies developed and considered other alternative levels of 
stringency for the Phase 2 program. The results of the analysis of 
these alternatives are discussed below in Section X of the Preamble. 
For tractors, the agencies developed the following alternatives as 
shown in Table III-29. The agencies are not adopting standards 
reflecting Alternative 2, because as already described, technically 
feasible standards are available that provide for greater emission 
reductions and reduced fuel consumption than provided under Alternative 
2. The agencies are not adopting standards reflecting Alternative 4 or 
Alternative 5 in their entirety because we do not believe to be 
feasible considering lead time and other relevant factors. However, we 
note that the tractor standards are predicated on the adoption of 
engine technology beyond what was projected in Alternative 4 of the 
NPRM. In addition, the final rule stringency includes additional 
technologies for tractors that were not considered in any of the 
alternatives analyzed in the NPRM--axle efficiency, transmission 
efficiency, adjustable automatic engine shutdown systems, and tire 
pressure monitoring systems.

     Table III-29--Summary of Alternatives Considered for the Final
                               Rulemaking
------------------------------------------------------------------------
      Alternatives 1a and 1b               No action alternatives
------------------------------------------------------------------------
Alternative 2.....................  Less Stringent than the Preferred
                                     Alternative applying off-the-shelf
                                     technologies.
Preferred Alternative.............  Final Phase 2 standards, fully
                                     phased-in by 2027 MY.
Alternative 4.....................  Alternative presented in the NPRM
                                     that pulls ahead the proposed 2027
                                     MY standards to 2024 MY.
Alternative 5.....................  Alternative based on very high
                                     market adoption of advanced
                                     technologies.
------------------------------------------------------------------------

E. Phase 2 Compliance Provisions for Tractors

    In HD Phase 1, the agencies developed an entirely new program to 
assess the CO2 emissions and fuel consumption of tractors. 
The agencies are carrying over many aspects of the Phase 1 compliance 
approach, but we are also adopting changes to enhance several aspects 
of the compliance program. The sections below highlight the key areas 
that are the same and those that are different.
(1) HD Phase 2 Compliance Provisions That Remain the Same
    The overall Phase 2 regulatory structure is discussed in more 
detail above in Section II. This section discusses tractor-specific 
compliance provisions.
(a) Application and Certification Process
    For the Phase 2 final rule, the agencies are keeping many aspects 
of the HD Phase 1 tractor compliance program. For example, the agencies 
will continue to use GEM (as revised for Phase 2), in coordination with 
additional component testing by manufacturers to determine the inputs, 
to determine compliance with the fuel efficiency and CO2 
standards. Another aspect that we are carrying over is the overall 
compliance approach. EMA's and the HD manufacturers' comments supported 
the continued use of GEM and did not support chassis-based 
certification.
    In Phase 1 and as finalized in Phase 2, the general compliance 
process in terms of the pre-model year, during the model year, and post 
model year activities remains unchanged. The manufacturers will be 
required to apply

[[Page 73623]]

for certification through a single source, EPA, with limited sets of 
data and GEM results (see 40 CFR 1037.205). EPA will issue certificates 
upon approval based on information submitted through the VERIFY 
database (see 40 CFR 1037.255). In Phase 1, EPA and NHTSA jointly 
review and approve innovative technology requests, i.e. performance of 
any technology whose performance is not measured by the GEM simulation 
tool and is not in widespread use in the 2010 MY. For Phase 2, the 
agencies are adopting a similar process for allowing credits for off-
cycle technologies that are not measured by the GEM simulation tool, 
although the revised GEM now recognizes many more technologies than the 
Phase 1 version of GEM, notably drivetrain and transmission 
improvements, so fewer technologies would be candidates for off-cycle 
credits (see Section I.B.v. for a more detailed discussion of off-cycle 
requests). During the model year, the manufacturers will continue to 
generate certification data and conduct GEM runs on each of the vehicle 
configurations it builds. After the model year ends, the manufacturers 
will submit end of year reports to EPA that include the GEM results for 
all of the configurations it builds, along with credit/deficit balances 
if applicable (see 40 CFR 1037.250 and 1037.730). EPA and NHTSA will 
jointly coordinate on any enforcement action required.
(b) Compliance Requirements
    As proposed in Phase 2, the agencies did not adopt any provisions 
in the final Phase 2 rules that significantly change the following 
Phase 1 provisions:

 Useful life of tractors (40 CFR 1037.105(e) and 1037.106(e)) 
although added for NHTSA in Phase 2 (49 CFR 535.5)
 Emission-related warranty requirements (40 CFR 1037.120)
 Maintenance instructions, allowable maintenance, and amending 
maintenance instructions (40 CFR 1037.125 and 137.220)
 Deterioration factors (40 CFR 1037.205(l) and 1037.241(c))
 Vehicle family, subfamily, and configurations (40 CFR 
1037.230), except for the addition of a heavy-haul family in Phase 2
(c) Drive Cycle Speed Targets and Weightings
    In Phase 1, the agencies adopted three drive cycles used in GEM to 
evaluate the fuel consumption and CO2 emissions from various 
vehicle configurations. One of the cycles is the Transient mode of the 
California ARB Heavy Heavy-Duty Truck 5 Mode cycle. It is intended to 
broadly cover urban driving. The other two cycles represent highway 
driving at 55 mph and 65 mph.
    The agencies proposed to maintain the existing Phase 1 drive cycle 
speed traces and weightings in Phase 2. In the Phase 2 proposal sleeper 
cab weightings would remain 5 percent of the Transient cycle, 9 percent 
of the 55 mph cycle, and 86 percent of the 65 mph cycle. The day cabs 
would be weighted based on 19 percent of the transient cycle, 17 
percent of the 55 mph cycle, and 64 percent of the 65 mph cycle (see 
proposed 40 CFR 1037.510(c) and 80 FR 40242). In response to the Phase 
2 NPRM, the American Trucking Associations (ATA) submitted comments 
based on spot speed records throughout the month of May 2015. This 
study found that Class 8 trucks operated at speeds of 55 mph or less 57 
percent of the time. United Parcel Service (UPS) stated that their 
Class 8 tractor-trailers average 54 miles per hour in part because they 
use vehicle speed limiters in their fleet. UPS also shared ATA's 
comments on the spot speed records. Daimler stated that they did not 
see a benefit of increasing the amount of low speed operation for 
tractors, unless the EPA-NREL work supported the need for a change.
    The agencies considered these comments along with the information 
that was used to derive the drive cycle weightings in Phase 1. The 
agencies did not receive any new drive cycle weighting data for 
tractors from the EPA-NREL work. The agencies believe that the study 
cited by ATA includes weightings of speed records, which represent the 
fraction of time spent at a given speed. However, our drive cycle 
weightings represent the fraction of vehicle miles traveled (VMT). The 
agencies used the vehicle speed information provided in the ATA 
comments and translated the weightings to VMT. Based on our assessment 
shown in RIA Chapter 3.4.3, their findings produce weightings that are 
approximately 74 percent of the vehicle miles traveled are at speeds 
greater than 55 mph and 26 percent less than 55 mph. In addition, the 
study cited by ATA represents ``Class 8 trucks'' which would include 
day cab tractors, sleeper cab tractors, and heavy heavy-duty vocational 
trucks. Based on this assessment, the agencies do not believe this new 
information is significantly different than the drive cycle weightings 
that were proposed. Therefore, we are adopting the drive cycle 
weightings for tractors that we adopted for Phase 1 and proposed for 
Phase 2.
    Both in the Phase 1 program and as proposed in the Phase 2 program, 
the 55 mph and 65 mph drive cycles used in GEM assume a constant target 
speed with downshifting occurring if road incline causes a 
predetermined drop in vehicle speed. In real-world vehicle operation, 
traffic conditions and other factors may cause periodic operation at 
lower (e.g. creep) or variable vehicle speeds. In the Phase 2 NPRM, the 
agencies requested comment on the need to include segments of lower or 
variable speed operation in the nominally 55 mph and 65 mph drive 
cycles used in GEM and how this may or may not impact the strategies 
manufacturers would develop. 80 FR 80242.
    In response, ACEEE commented that NREL found that constant speeds 
on positive and negative grades misrepresent the real world operation 
of HD trucks because there is a strong correlation between road grade 
and average speed. Daimler commented that for regulatory purposes using 
a constant speed cycle with representative road grade is appropriate, 
noting as well that some manufacturers use a constant speed cycle in 
their internal development processes and have found it correlates well 
to real world operation. They also highlight the concern that it would 
be extremely difficult to develop traffic patterns that represent a 
national average. However, Daimler also stated in their comments that 
they do see a benefit of allowing increased variability in the vehicle 
speeds in the 55 and 65 mph cycles, for evaluating the effectiveness of 
technologies such as predictive cruise control.
    After considering these comments and evaluating the final Phase 2 
version of GEM, the agencies are adopting in the Phase 2 final rules 
constant target speed for the 55 mph and 65 mph cycles, as adopted in 
Phase 1. One key difference in Phase 2 is the addition of road grade in 
these cruise cycles, as discussed below in Section III.E.2. The 
addition of road grade to the cruise cycles brings the GEM simulation 
of vehicles over the drive cycles closer to the real world operation 
described by ACEEE and Daimler. Even though the cruise cycles will 
continue to have constant target speeds (55 mph or 65 mph), the vehicle 
may slow down from the target speed of the cycle on an uphill stretch 
of road due to the addition of road grade in the Phase 2 cycles. If the 
vehicle does slow down, the transmission shift logic built into GEM 
will downshift the transmission to limit the amount of further vehicle 
deceleration. Similarly, on the downhill portions of the cycles, the 
driver control logic built into GEM will allow the vehicle to exceed 
the

[[Page 73624]]

target speed by 3 mph prior to braking the vehicle.
(d) Empty Weight and Payload
    The total weight of the tractor-trailer combination is the sum of 
the tractor curb weight, the trailer curb weight, and the payload. The 
total weight of a vehicle is important because it in part determines 
the impact of technologies, such as rolling resistance, on GHG 
emissions and fuel consumption. In Phase 2, we proposed to carry over 
the total weight of the tractor-trailer combination used in GEM for 
Phase 1. The agencies developed the tractor curb weight inputs for 
Phase 2 from actual tractor weights measured in two of EPA's Phase 1 
test programs. The trailer curb weight inputs were derived from actual 
trailer weight measurements conducted by EPA and from weight data 
provided to ICF International by the trailer manufacturers.\298\ We 
welcomed comment on the tractor weights we proposed.
---------------------------------------------------------------------------

    \298\ ICF International. Investigation of Costs for Strategies 
to Reduce Greenhouse Gas Emissions for Heavy-Duty On-road Vehicles. 
July 2010. Pages 4-15. Docket Number EPA-HQ-OAR-2010-0162-0044.
---------------------------------------------------------------------------

    Daimler commented that there is a large spread of weights within a 
subcategory given the variety of different features that a vehicle 
might incorporate in order to perform its task. The agencies' proposed 
curb weights for tractors may be higher than Daimler's vehicles but in 
Daimler's opinion align with some of their competitors' vehicles, and 
therefore are reasonable. Based on no negative comment or newer data, 
the agencies are adopting the Phase 1 tractor curb weights, as 
proposed.
    There is a further issue of what payload weight to assign during 
compliance testing. In use, trucks operate at different weights at 
different times during their operations. The greatest freight transport 
efficiency (the amount of fuel required to move a ton of payload)--
would be achieved by operating trucks at the maximum load for which 
they are designed all of the time. However, this may not always be 
practicable. Delivery logistics may dictate partial loading. Some 
payloads, such as potato chips, may fill the trailer before it reaches 
the vehicle's maximum weight limit. Or full loads simply may not be 
available commercially. M.J. Bradley analyzed the Truck Inventory and 
Use Survey and found that approximately 9 percent of combination 
tractor miles travelled empty, 61 percent are ``cubed-out'' (the 
trailer volume is full before the weight limit is reached), and 30 
percent are ``weighed out'' (operating weight equals 80,000 lbs which 
is the gross vehicle weight limit on the Federal Interstate Highway 
System or greater than 80,000 lbs for vehicles traveling on roads 
outside of the interstate system).\299\
---------------------------------------------------------------------------

    \299\ M.J. Bradley & Associates. Setting the Stage for 
Regulation of Heavy-Duty Vehicle Fuel Economy and GHG Emissions: 
Issues and Opportunities. February 2009. Page 35. Analysis based on 
1992 Truck Inventory and Use Survey data, where the survey data 
allowed developing the distribution of loads instead of merely the 
average loads.
---------------------------------------------------------------------------

    The amount of payload that a tractor can carry depends on the 
category (or GVWR and GCWR) of the vehicle. For example, a typical 
Class 7 tractor can carry less payload than a Class 8 tractor. For 
Phase 1, the agencies used the Federal Highway Administration Truck 
Payload Equivalent Factors using Vehicle Inventory and Use Survey 
(VIUS) and Vehicle Travel Information System data to determine the 
payloads. FHWA's results indicated that the average payload of a Class 
8 vehicle ranged from 36,247 to 40,089 lbs, depending on the average 
distance travelled per day.\300\ The same study shows that Class 7 
vehicles carried between 18,674 and 34,210 lbs of payload also 
depending on average distance travelled per day. Based on these data, 
the agencies proposed to continue to prescribe a fixed payload of 
25,000 lbs for Class 7 tractors and 38,000 lbs for Class 8 tractors for 
certification testing for Phase 2. The agencies also proposed to 
continue to use a common payload for Class 8 day cabs and sleeper cabs 
as a predefined GEM input because the data available do not distinguish 
among Class 8 tractor types. These payload values represent a heavily 
loaded trailer, but not maximum GVWR, since as described above the 
majority of tractors ``cube-out'' rather than ``weigh-out.''
---------------------------------------------------------------------------

    \300\ The U.S. Federal Highway Administration. Development of 
Truck Payload Equivalent Factor. Table 11. Last viewed on March 9, 
2010 at http://ops.fhwa.dot.gov/freight/freight_analysis/faf/faf2_reports/reports9/s510_11_12_tables.htm.
---------------------------------------------------------------------------

    The agencies requested comments and data to support changes to our 
proposed payloads for Phase 2. 80 FR 40242. Daimler commented that the 
payload weight is even more difficult to determine because weights 
change based on economic conditions, such as when carriers continue to 
try to reduce their dead volume and increase their weight per load. 
Daimler suggested that the agencies might consider increasing the 
proposed payloads, but did not provide data. In the absence of newer 
data or other compelling comments, the agencies continue to believe 
that it is appropriate to continue using the Phase 1 tractor payloads 
for all of the Class 7 and 8 tractors, as proposed, except for heavy-
haul.
    Details of the predefined weights by regulatory subcategory, as 
shown in Table III-30, are included in RIA Chapter 3.

                              Table III-30--Final Combination Tractor Weight Inputs
----------------------------------------------------------------------------------------------------------------
                                   Regulatory      Tractor tare       Trailer                      Total  weight
          Model type               subcategory     weight  (lbs)   weight  (lbs)  Payload  (lbs)       (lbs)
----------------------------------------------------------------------------------------------------------------
Class 8.......................  Sleeper Cab High          19,000          13,500          38,000          70,500
                                 Roof.
Class 8.......................  Sleeper Cab Mid           18,750          10,000          38,000          66,750
                                 Roof.
Class 8.......................  Sleeper Cab Low           18,500          10,500          38,000          67,000
                                 Roof.
Class 8.......................  Day Cab High              17,500          13,500          38,000          69,000
                                 Roof.
Class 8.......................  Day Cab Mid Roof          17,100          10,000          38,000          65,100
Class 8.......................  Day Cab Low Roof          17,000          10,500          38,000          65,500
Class 7.......................  Day Cab High              11,500          13,500          25,000          50,000
                                 Roof.
Class 7.......................  Day Cab Mid Roof          11,100          10,000          25,000          46,100
Class 7.......................  Day Cab Low Roof          11,000          10,500          25,000          46,500
Class 8.......................  Heavy-Haul......          19,000          13,500          86,000         118,500
----------------------------------------------------------------------------------------------------------------


[[Page 73625]]

(e) Tire Testing
    In Phase 1, manufacturers are required to input their tire rolling 
resistance coefficient into GEM. Also in Phase 1, the agencies adopted 
the provisions in ISO 28580 to determine the rolling resistance of 
tires. As described in 40 CFR 1037.520(c), the agencies require that at 
least three tires for each tire design are to be tested at least one 
time. Our assessment of the Phase 1 program to date indicates that 
these requirements reasonably balance the need for precision, 
repeatability, and testing burden. Therefore we proposed to carry over 
the Phase 1 testing provisions for tire rolling resistance into Phase 
2. 80 FR 40243. We welcomed comments regarding the tire testing 
provisions, but did not receive any. Therefore, based on the same 
reasoning presented at proposal, we are adopting the Phase 1 tire 
testing provisions in Phase 2.
    In Phase 1, the agencies received comments from stakeholders 
highlighting a need to develop a reference lab and alignment tires for 
the HD sector. The agencies discussed the lab-to-lab comparison 
conducted in the Phase 1 EPA tire test program (80 FR 40243, citing to 
76 FR 57184). The agencies reviewed the rolling resistance data from 
the tires that were tested at both the STL and Smithers laboratories to 
assess inter-laboratory and test machine variability. The agencies 
conducted statistical analysis of the data to gain better understanding 
of lab-to-lab correlation and developed an adjustment factor for data 
measured at each of the test labs. Based on these results, the agencies 
believe the lab-to-lab variation for the STL and Smithers laboratories 
will have very small effect on measured rolling resistance values. 
Based on the test data, the agencies judge for the HD Phase 2 program 
to continue to use the current levels of variability, and the agencies 
therefore proposed to allow the use of either Smithers or STL 
laboratories for determining the tire rolling resistance value. The 
agencies requested comment on the need to establish a reference machine 
for the HD sector and whether tire testing facilities are interested in 
and willing to commit to developing a reference machine. The agencies 
did not receive any comments on the issue. Therefore, again based on 
the reasoning presented at proposal, we are adopting the Phase 1 
testing approach for Phase 2.
(2) Key Differences in HD Phase 2 Compliance Provisions
    The agencies are adopting certain provisions in Phase 2 that are 
significantly different from Phase 1. Details regarding some of these 
key changes such as aerodynamic assessments, road grade in the drive 
cycles, weight reduction, GEM inputs, emission control labels, and 
chassis dynamometer testing are provided in this subsection.
(a) Aerodynamic Assessment
    In Phase 1, the manufacturers conduct aerodynamic testing to 
establish the appropriate bin and GEM input for determining compliance 
with the CO2 and fuel consumption standards. The agencies 
proposed to continue this general approach in HD Phase 2, but to make 
several enhancements to the aerodynamic assessment of tractors. As 
discussed below, we proposed some modifications to the aerodynamic test 
procedures--the addition of wind averaged drag in the aerodynamic 
assessment, the addition of trailer skirts to the standard trailer used 
to determine aerodynamic performance of tractors and revisions to the 
aerodynamic bins. As discussed in more detail in the following 
subsections, we are adopting many of the proposed Phase 2 aerodynamic 
test procedures, but with some additional revisions to the test 
procedures. These procedures are then appropriately reflected in the 
final Phase 2 aerodynamic bins.
(i) Phase 1 Aerodynamic Test Procedures
    The aerodynamic drag of a vehicle is determined by the vehicle's 
coefficient of drag (Cd), frontal area, air density and speed. 
Quantifying tractor aerodynamics as an input to the GEM presents 
technical challenges because of the proliferation of tractor 
configurations and subtle variations in measured aerodynamic values 
among various test procedures. In Phase 1, Class 7 and 8 tractor 
aerodynamic results are developed by manufacturers using a range of 
techniques, including wind tunnel testing, computational fluid 
dynamics, and constant speed tests.
    We continue to believe a broad approach allowing manufacturers to 
use these multiple test procedures to demonstrate aerodynamic 
performance of its tractor fleet is appropriate given that no single 
test procedure is superior in all aspects to other approaches. However, 
we also recognize the need for consistency and a level playing field in 
evaluating aerodynamic performance. To address the consistency and 
level playing field concerns, NHTSA and EPA adopted in Phase 1, while 
working with industry, an approach that identified a reference 
aerodynamic test method (coastdown) and a procedure to align results 
from other aerodynamic test procedures with the reference method by 
applying a correction factor (Falt-aero) to results from 
alternative methods. The Phase 1 regulations require manufacturers to 
use good engineering judgment in developing their corrections and 
specify some minimum testing requirements.
(ii) Reference Aerodynamic Method in Phase 2
    Based on feedback received during the development of Phase 1, we 
understood even before the Phase 2 NPRM was issued that there was 
interest from some manufacturers to change the reference method in 
Phase 2 from coastdown to constant speed testing. EPA conducted an 
aerodynamic test program at Southwest Research Institute to evaluate 
both methods in terms of cost of testing, testing time, testing 
facility requirements, and repeatability of results. Details of the 
analysis and results are included in RIA Chapter 3.2. The results 
showed that the enhanced coastdown test procedures and analysis 
produced results with acceptable repeatability and at a lower cost than 
the constant speed testing. Based on the results of this testing, the 
agencies proposed to continue to use the enhanced coastdown procedure 
for the reference method in Phase 2.\301\ 80 FR 40244. However, we 
welcomed comment on the need to change the reference method for the 
Phase 2 final rule to constant speed testing, including comparisons of 
aerodynamic test results using both the coastdown and constant speed 
test procedures. In addition, we welcomed comments on and suggested 
revisions to the constant speed test procedure specifications set forth 
in the proposal in Chapter 3.2.2.2 of the draft RIA and 40 CFR 1037.533 
in the proposed regulations (40 CFR 1037.534 in the final regulations).
---------------------------------------------------------------------------

    \301\ Southwest Research Institute. ``Heavy Duty Class 8 Truck 
Coastdown and Constant Speed Testing.'' April 2015.
---------------------------------------------------------------------------

    Several stakeholders provided comments both in favor and against 
the use of coastdown as the reference aero method for Phase 2 for 
tractors. CARB does not support the constant speed test as the 
reference method until it can be demonstrated to be superior to the 
coastdown methods. Their concerns included the cost associated with 
vehicle modifications required in test preparation (such as the torque 
meters

[[Page 73626]]

on the wheel hubs). Daimler did not support a change to constant speed 
testing for the reference method and stated that more time is needed to 
determine if constant speed testing would be a better alternative. 
Navistar supports the coastdown as the reference method and does not 
believe constant speed testing should be adopted even as an 
alternative, unless significant further work is conducted. EMA stated 
that they could not support the adoption of constant speed testing as 
the reference method in Phase 2 because there is insufficient time in 
the process to properly study whether constant speed is equivalent to 
or better than coastdown testing. Further, EMA recommended that 
constant speed testing be included only as a potential alternative to 
be phased in at a future date if appropriate. Volvo opposed a change in 
the aerodynamic reference test method to constant speed at this time 
due to insufficient time to fully evaluate the new test method.
    Exa supported the use of constant speed testing as a reference 
method because it is a real-world measurement with the ability to 
evaluate wind-averaged drag. Exa also cited some concerns that 
coastdown is limited to near zero wind yaw angle and does not 
accurately represent the aerodynamics experienced on the road. MEMA 
supported including the constant speed test based on research that has 
demonstrated that it is reliable relative to coastdown tests and is 
required in European aerodynamic test protocols. SABIC commented that 
constant speed testing may help isolate the aerodynamic drag from 
vibration, mechanical, and friction encountered at low speeds. SABIC 
also cited research that suggested constant speed testing may provide 
better repeatability than coastdown tests, and suggested that the U.S. 
may be able to promote harmonization with the required European 
constant speed testing.
    After consideration of the comments, the agencies are continuing to 
use the Phase 1 approach of setting coastdown testing as the reference 
method for tractor aerodynamic assessment in Phase 2. After developing 
revised coastdown test procedures and data analysis methods for the 
final rule, we have concluded that coastdown testing continues to 
produce acceptable repeatability and can be conducted at a lower cost 
than constant speed testing. However, we are finalizing some revisions 
to the Phase 2 coastdown test procedures in response to comments and 
discussed below. The agencies are also continuing to allow alternative 
test methods to be used to determine the aerodynamic performance of 
tractors in Phase 2, as long as the results are correlated back to the 
reference method using a correlation factor (Falt-aero). Additional 
details are included in the Falt-aero discussion below.
(iii) Coastdown Test Procedure Changes for Phase 2
    The agencies worked closely with the tractor manufacturers between 
the Phase 2 NPRM and final rulemaking to develop robust coastdown test 
procedures that are technically sound.\302\ EPA also continued to test 
additional tractors after the proposal to better inform the test 
procedure development. Based on this work, the agencies are adopting 
aerodynamic test procedures that have been improved from those proposed 
for Phase 2. The details of these procedures and their development are 
included in RIA Chapter 3.2. Below is a summary of the changes to the 
coastdown test procedures and data analysis method for the final rule.
---------------------------------------------------------------------------

    \302\ Memo to Docket. Aerodynamic Subteam Meetings with EMA. 
July 2016. Docket EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    The coastdown test procedure changes include the tested speed 
range, the calibration of the equipment, and specification of yaw and 
air speed measurements. The agencies proposed two test speed ranges for 
coastdown testing--70 to 60 mph and 25 to 15 mph. EPA's evaluation of 
the CdA values in relation to yaw angle showed that the 25 
to 15 mph low-speed range specified in the NPRM test procedures 
produced yaw curves that were flatter than expected and flatter than 
demonstrated using other test methods, such as wind tunnels and CFD. 
Upon further analysis, EPA found that by reducing the low-speed range 
to even lower speeds, the yaw curve results were more representative. 
The best speed range to alleviate this concern is a 15 to 5 mph low 
speed range; however, requiring this would significantly reduce the 
number of available days for testing in a given year because it would 
lead to a wind speed limit of 3 mph. Therefore, the agencies are 
adopting a low speed range of 20 to 10 mph to balance the yaw curve 
representativeness with the real world testing implications. Along with 
this test speed change, the component of the wind speed parallel to the 
road or track will be limited to less than or equal to 6 mph. The 
agencies are adopting Phase 2 coastdown test procedures that specify 
the yaw measurement method resolution and accuracy requirements similar 
to those proposed for constant speed testing. The calibration of the 
yaw and air speed equipment will be conducted in a point-by-point 
manner for each run.
    The coastdown data analysis changes include the analysis of low 
speed pairs and filtering methods, adjustments for rear axle losses and 
rolling resistance, and determination of the final CdA value 
for coastdown. EPA found that the method proposed to analyze the 
coastdown results of paired runs leads to an unexpected yaw curve 
asymmetry. Upon further evaluation, EPA found that the yaw curve 
asymmetry is mitigated by averaging the road load force and air speed 
from every two opposite direction low-speed segments and using the 
average with each of the high speed segments in the data analysis. 
Therefore, the agencies are adopting this method for the Phase 2 final 
rules. The filtering of the air speed, yaw, vehicle speed, and track 
wind speed is necessary to remove outliers and replace the data with 
the moving median value to reduce the variability of coastdown test 
results. The agencies are specifying this filtering method in the final 
rules. Coastdown testing measures all of the losses associated with the 
vehicle, including aerodynamics, rolling resistance, and axle spin 
losses. To isolate the aerodynamic CdA, it is important to 
remove the losses associated with drive axle and tire rolling 
resistance. For the final Phase 2 rules, the agencies are adopting the 
SAE J2452 test procedures that require manufacturers to measure the 
speed dependence of the tire rolling resistance for each of the steer, 
drive, and trailer tire models used on the article undergoing a 
coastdown test. The agencies are also requiring that manufacturers 
measure the speed dependence of the drive axle spin losses for the 
drive axle model used in the article undergoing a coastdown test using 
a subset of the rear axle efficiency test procedure being adopted in 
Phase 2.
    The agencies have also developed a process of identifying and 
removing coastdown test result outliers for the final rules. First, the 
median yaw angle of the data is determined. All results outside of a 
range of plus or minus 1 yaw degree are removed. Then the mean 
CdA value of the remaining data points is determined. 
CdA values that lie outside of plus or minus two standard 
deviations from the CdA mean are removed. At least 24 data 
points are needed after removal of outliers for the results to be 
valid. Finally, the mean CdA and mean effective yaw angle 
are calculated from the remaining points. These values are then used to 
adjust to reflect a 4.5 degree yaw angle result

[[Page 73627]]

based on an alternate method yaw curve results.
(iv) Improving Correlation of Coastdowns With Alternative Methods 
(Falt-aero)
    As already noted, the agencies adopted in Phase 1 a coastdown 
procedure as the reference method (see 40 CFR 1066.310) and defined a 
process for manufacturers to align drag results from each of their own 
alternative test methods to the reference method results using 
Falt-aero (see 40 CFR 1037.525).\303\ Manufacturers are able 
to use any aerodynamic evaluation method in demonstrating a vehicle's 
aerodynamic performance as long as they obtain our prior approval and 
the method is aligned to the reference method. The agencies proposed to 
continue to use this alignment method approach in Phase 2 to maintain 
the testing flexibility that manufacturers have today. However, the 
agencies proposed to increase the rigor in determining the 
Falt-aero for Phase 2, including enhancing the minimum 
testing requirements. Beginning in MY 2021, we proposed that the 
manufacturers would be required to determine a new Falt-aero 
for each of their tractor models for each aerodynamic test method. In 
Phase 1, manufacturers are required to determine their 
Falt-aero using only a high roof sleeper cab with a full 
aerodynamics package (see 40 CFR 1037.521(a)(2) and proposed 40 CFR 
1037.525(b)(2)). In Phase 2, we proposed that manufacturers would be 
required to determine a unique Falt-aero value for each 
major model of their high roof day cabs and high roof sleeper cabs. In 
Phase 2, we proposed that manufacturers may carry over the 
Falt-aero value until a model changeover or based on the 
agencies' discretion to require up to six new Falt-aero 
determinations each year. We requested comment on the amount of testing 
required to accurately develop a Falt-aero value and the 
burden associated with it. See 80 FR 40244.
---------------------------------------------------------------------------

    \303\ Falt-aero is an experimentally determined 
factor that represents the ratio of coastdown results to results 
from the alternative method. The agencies allow other functional 
forms of the relationship consistent with good engineering judgment.
---------------------------------------------------------------------------

    The agencies received comments with regard to the need of 
Falt-aero and the burden of determining it. Exa Corporation 
(a supplier of CFD software) commented that it is not clear that the 
Falt-aero factor would alleviate challenges associated with 
their expectation that the absolute drag values will differ 
substantially between different test methods and different facilities. 
Exa suggested that the agencies require a certification procedure for 
an alternate tool that includes a broad validation suite including 
different types of vehicles from aerodynamic sleeper to less 
aerodynamic day cabs. The HD vehicle manufacturers strongly recommended 
that the agencies reduce the number of coastdown tests that must be 
conducted each year. Navistar commented that only one 
Falt-aero should be required for Phase 2. Navistar's testing 
of their ProStar sleeper and day cabs found that the 
Falt-aero only differed within less than one percent using 
the same test facility. Navistar also commented that the data in the 
Phase 2 NPRM draft RIA show that three different sleepers show 
Falt-aero values within 0.4 percent. EMA commented that only 
one Falt-aero value should be required, as supported by the 
values shown in the Phase 2 Draft RIA where the Falt-aero 
values were 1.09 +/-0.02 for three tested vehicles. EMA also commented 
that the proposed requirements would be time-consuming, costly, and an 
unreasonable burden. Daimler supported EMA's comments. The HD vehicle 
manufacturers also submitted data to the agencies that show the 
Falt-aero values were within a range of one percent. Volvo 
shared data with the agencies that support that Falt-aero is 
highly consistent for varying truck models when correcting the test 
data under the conditions and methods that the industry has 
recommended. Volvo therefore concluded that multiple 
Falt-aero values are not necessary for Phase 2. PACCAR 
provided results from three tractor models showing the spread of 
Falt-aero is less than 0.3 percent.
    The agencies determined the Falt-aero values for all of 
the tractors tested using different aerodynamic methods for Phase 2 
using the aerodynamic test procedures and data analysis finalized for 
Phase 2. As shown in further detail in RIA Chapter 3.2.1, the 
Falt-aero values ranged between 1.13 and 1.20 for a single 
CFD software. Therefore, the agencies concluded that a single 
Falt-aero value is not sufficient for determining the 
correlation of test methods for all tractors. Furthermore, based on the 
comments and further refinement of our selective enforcement audit 
(SEA) provisions in the Phase 2 final rule, we are adopting provisions 
that require manufacturers to determine Falt-aero for a 
minimum of one day cab and one sleeper cab in MYs 2021, 2024, and 
2027.\304\ While this significantly reduces the test burden from the 
levels proposed, it also only represents a minimum requirement. The 
agencies believe that the improvements to the SEA requirements for 
aerodynamics will further encourage the manufacturers to ensure that 
they are accurately reflecting the Falt-aero for their entire tractor 
fleet and that they may do additional Falt-aero 
determinations beyond the minimum requirement in Phase 2. Without 
confidence in their Falt-aero values, manufacturers would 
risk SEA failures that could halt vehicle production. Even without 
failing the SEA overall, failing individual vehicles would lead to 
increased SEA testing. Thus, the SEA requirements will create a 
stronger incentive for manufacturers to use good engineering judgment 
for Falt-aero values.
---------------------------------------------------------------------------

    \304\ See Section III.E.(2)(a)(ix) for details on the SEA 
requirements.
---------------------------------------------------------------------------

    The agencies also received comments from HD manufacturers stressing 
that coastdown testing does not produce CdA values at zero 
yaw as assumed. Even at calm test conditions, the resulting yaw angle 
is something greater than zero degrees. The agencies evaluated our 
aerodynamic test data and agree with the manufacturers. Therefore, we 
are adopting Phase 2 provisions that use the effective yaw angle from 
coastdown testing to determine the Falt-aero value (see 40 
CFR 1037.525). See RIA Chapter 3.2.2 for additional detail.
(v) Computational Fluid Dynamics
    The agencies considered refinements to the computational fluid 
dynamics (CFD) modeling method to determine the aerodynamic performance 
of tractors in the NPRM. Specifically, we are considering whether the 
conditions for performing the analysis require greater specificity 
(e.g., wind speed and direction inclusion, turbulence intensity 
criteria value) or if turbulence model and mesh deformation should be 
required, rather than ``if applicable,'' for all CFD analysis.\305\ The 
agencies welcomed comment on the proposed revisions.
---------------------------------------------------------------------------

    \305\ 40 CFR 1037.532 ``Using computational fluid dynamics to 
calculate drag area (CdA).''
---------------------------------------------------------------------------

    Daimler and EMA recommended that the agencies should raise the test 
speed for CFD from the proposed 55 mph to 65 mph to be consistent with 
GEM and the sleeper cab tractor weighting of 86 percent. Daimler 
supported the agencies' other proposed revisions to CFD test 
procedures.
    The agencies agree with the suggested comment to include 
consistency between the test methods and are adopting CFD provisions 
that include a test speed of 65 mph, along with the other proposed 
revisions. The agencies finalized these changes through incorporation 
of the SAE J2966 CFD guidelines with exceptions and clarifications to 
keep other aspects of

[[Page 73628]]

the CFD simulations consistent with Phase 1.
(vi) Wind Averaged Drag Determination
    In Phase 1, EPA and NHTSA recognized that wind conditions, most 
notably wind direction, have a greater impact on real world 
CO2 emissions and fuel consumption of heavy-duty trucks than 
of light-duty vehicles.\306\ As noted in the NAS report, the wind 
average drag coefficient is about 15 percent higher than the zero 
degree coefficient of drag.\307\ In addition, the agencies received 
comments in Phase 1 that supported the use of wind averaged drag 
results for the aerodynamic determination. The agencies considered 
adopting the use of a wind averaged drag coefficient in the Phase 1 
regulatory program, but ultimately decided to finalize drag values 
which represent zero yaw (i.e., representing wind from directly in 
front of the vehicle, not from the side) instead. We took this approach 
recognizing that the reference method is coastdown testing and it is 
not capable of determining wind averaged yaw.\308\ Wind tunnels and CFD 
are currently the only tools to accurately assess the influence of wind 
speed and direction on a truck's aerodynamic performance. The agencies 
recognized, as NAS did, that the results of using the zero yaw approach 
may result in fuel consumption predictions that are offset slightly 
from real world performance levels, not unlike the offset we see today 
between fuel economy test results in the CAFE program and actual fuel 
economy performance observed in-use.
---------------------------------------------------------------------------

    \306\ See 2010 NAS Report, page 95.
    \307\ See 2010 NAS Report, Finding 2-4 on page 39. Also see 2014 
NAS Report, Recommendation 3.5.
    \308\ See 2010 NAS Report. Page 95.
---------------------------------------------------------------------------

    As the tractor manufacturers continue to refine the aerodynamics of 
tractors, we believe that continuing the zero yaw approach into Phase 2 
would potentially impact the overall technology effectiveness or change 
the kinds of technology decisions made by the tractor manufacturers in 
developing equipment to meet our HD Phase 2 standards. Therefore, we 
proposed and are adopting aerodynamic test procedures that take into 
account the wind averaged drag performance of tractors. The agencies 
proposed to account for this change in aerodynamic test procedure by 
appropriately adjusting the aerodynamic bins to reflect a wind averaged 
drag result instead of a zero yaw result.
    The agencies proposed and are adopting provisions that require 
manufacturers to adjust their CdA values to represent a zero 
yaw value from coastdown and add the CdA impact of the wind 
averaged drag. The impact of wind averaged drag relative to a zero yaw 
condition can only be measured in a wind tunnel or with CFD. This 
requirement commences in MY 2021.
    All stakeholders that commented on wind averaged drag supported its 
use over zero yaw. ACEEE supports the shift to the use of wind averaged 
drag in Phase 2. Exa supported the use of wind averaged drag because it 
is a better predictor of real world fuel economy. Michelin supported 
wind average drag assessments for a realistic and complete assessment 
of aerodynamic performance and would prevent the unintended consequence 
of incentivizing improvements that are better at zero wind conditions 
but sacrifice cross-wind performance. SABIC Innovative Plastics 
commented that it is imperative that wind effects be part of the 
standard due to the real-world impact of wind. Plastics Industry Trade 
Association supported wind average drag to better simulate real life 
conditions.
    PACCAR and Daimler recommended the use of a surrogate angle of 
4.5[deg] in lieu of the nine angles required for a full wind averaged 
draft evaluation for CFD evaluated at 65 mph. PACCAR and Daimler 
provided data to support the use of a single angle. PACCAR also stated 
that there is significant CFD burden associated with the use of a nine 
angle yaw sweep. According to PACCAR in a given year, this would add 
approximately 4,000 additional simulations to their certification 
burden. EMA and other tractor manufacturers supported the single 
surrogate angle of 4.5[deg] as being equivalent to the full yaw sweep 
result generated with SAE J1252.
    As discussed in further detail in RIA Chapter 3.2.1.1.3, our data 
support that 4.5[deg] results are a good surrogate for full wind 
averaged drag results for wind tunnel and CFD assessments. Therefore, 
we are adopting the 4.5[deg] surrogate angle in Phase 2.
    The agencies require that manufacturers use the following equation 
to make the necessary adjustments to a coastdown result to obtain the 
CdAwa value:

CdAwa = 
CdAeffective yaw angle, coastdown * 
(CdA4.5[deg]/
CdAeffective yaw angle)

    If the manufacturer has a CdA value from either a wind 
tunnel or CFD, then they will use the following equation to obtain the 
CdA wad value:

CdAwa = CdA4.5[deg] * 
Falt-aero

    Because the agencies are adopting a 4.5[deg] surrogate angle, the 
agencies are not adopting the proposed provisions that manufacturers 
have the option of determining the offset between zero yaw and wind 
averaged yaw either through testing or by using the EPA-defined default 
offset.
(vii) Standard Trailer Definition
    Similar to the approach the agencies adopted in Phase 1, NHTSA and 
EPA are adopting provisions such that the tractor performance in GEM is 
judged assuming the tractor is pulling a standardized trailer.\309\ The 
agencies believe that an assessment of the tractor fuel consumption and 
CO2 emissions should be conducted using a tractor-trailer 
combination, as tractors are invariably used in combination with 
trailers and this is their essential commercial purpose. Trailers, of 
course, also influence the extent of carbon emissions from the tractor 
(and vice-versa). We believe that using a standardized trailer best 
reflects the impact of the overall weight of the tractor-trailer and 
the aerodynamic technologies in actual use, and consequent real-world 
performance, where tractors are designed and used with a trailer. EPA 
research confirms what one intuits: Tractor-trailer pairings are almost 
always optimized, but this does not indicate that a tractor always uses 
the same trailer. EPA conducted an evaluation of over 4,000 tractor-
trailer combinations using live traffic cameras in 2010.\310\ The 
results showed that approximately 95 percent of the tractors were 
matched with the standard trailer specified (high roof tractor with dry 
van trailer, mid roof tractor with tanker trailer, and low roof with 
flatbed trailer). Therefore, the agencies are continuing the Phase 1 
approach into Phase 2 GEM to use a predefined typical trailer in 
assessing overall performance for test purposes. As such, the high roof 
tractors will be paired with a standard dry van trailer; the mid roof 
tractors will be paired with a tanker trailer; and the low roof 
tractors will be paired with a flatbed trailer.
---------------------------------------------------------------------------

    \309\ See 40 CFR 1037.501(g).
    \310\ See Memo to Docket, Amy Kopin. ``Truck and Trailer Roof 
Match Analysis.'' August 2010.
---------------------------------------------------------------------------

    However, the agencies proposed a change to the definition of the 
standard dry van reference trailer used by tractor manufacturers to 
determine the aerodynamic performance of high roof tractors in Phase 2. 
We believe this is necessary to reflect the aerodynamic improvements 
experienced by the trailer fleet over the last several years due to 
influences from the California Air Resources Board mandate \311\ and 
EPA's

[[Page 73629]]

SmartWay Transport Partnership. The standard dry van trailer used in 
Phase 1 to assess the aerodynamic performance of high roof tractors is 
a 53 foot box trailer without any aerodynamic devices. In the 
development of Phase 2, the agencies evaluated the increase in adoption 
rates of trailer side skirts and boat tails in the market over the last 
several years and have seen a marked increase. We estimate that 
approximately 50 percent of the new trailers sold in 2018 will have 
trailer side skirts.312 313 As the agencies look towards 
these tractor standards in the 2021 and beyond timeframe, we believe 
that it is appropriate to update the standard box trailer definition. 
In 2021-2027, we believe the trailer fleet will be a mix of trailers 
with no aerodynamics, trailers with skirts, and trailers with advanced 
aero; with the advanced aero being a very limited subset of the new 
trailers sold each year. Consequently, overall, we believe a trailer 
with a skirt will be the most representative of the trailer fleet for 
the duration of the regulation timeframe, and plausibly beyond. EPA has 
conducted extensive aerodynamic testing to quantify the impact on the 
coefficient of drag of a high roof tractor due to the addition of a 
trailer skirt. Details of the test program and the results can be found 
in RIA Chapter 3.2. The results of the test program indicate that on 
average, the impact of a trailer skirt matching the definition of the 
skirt specified in 40 CFR 1037.501(g)(1) is approximately eight percent 
reduction in drag area.
---------------------------------------------------------------------------

    \311\ California Air Resources Board. Tractor-Trailer Greenhouse 
Gas regulation. Last viewed on September 4, 2014 at http://www.arb.ca.gov/msprog/truckstop/trailers/trailers.htm.
    \312\ Ben Sharpe (ICCT) and Mike Roeth (North American Council 
for Freight Efficiency), ``Costs and Adoption Rates of Fuel-Saving 
Technologies for Trailer in the North American On-Road Freight 
Sector,'' Feb 2014.
    \313\ Frost & Sullivan, ``Strategic Analysis of North American 
Semi-trailer Advanced Technology Market,'' Feb 2013.
---------------------------------------------------------------------------

    We proposed a definition of the standard dry van trailer in Phase 
2--the trailer assumed during the certification process to be paired 
with a high roof tractor--that includes a trailer skirt starting in 
2021 model year. 80 FR 40245. Even though the agencies proposed that 
new dry van trailer standards begin in 2018 MY, we did not propose to 
update the standard trailer in the tractor certification process until 
2021 MY, to align with the new tractor standards. If we were to revise 
the standardized trailer definition for Phase 1, then we would have 
needed to revise the Phase 1 tractor standards. The details of the 
trailer skirt definition are included in 40 CFR 1037.501(g)(1). We 
requested comment on our HD Phase 2 standard trailer configuration. We 
also welcomed comments on suggestions for alternative ways to define 
the standard trailer, such as developing a certified computer aided 
drawing (CAD) model.
    The agencies received support in comments for adopting a reference 
trailer with skirts. Daimler supported the addition of side skirts to 
the Phase 2 reference trailer and stated that it aligns with their 
internal development process. Daimler also suggested that if the 
agencies believe there will be significant adoption of trailers with 
boat tails, then the agencies could update the CdA bin value 
input to GEM and reduce it by 0.5 m\2\ to reflect the actual on-road 
aerodynamics load without changing the standard trailer. The Plastics 
Industry Trade Association stated that the proposed reference trailer 
is representative of trailer aerodynamic improvements likely to emerge 
during Phase 2. Navistar suggested that the standard trailer should be 
more aerodynamic to reflect trailers that will be used during the life 
of Phase 2 tractors. ACEEE supports the use of a more aerodynamic 
reference trailer in Phase 2, however, they suggest an even more 
aerodynamic reference trailer be required that is closer to the 
aerodynamic packages projected to be installed on new trailers in 2027. 
ACEEE and UCS suggested that Phase 2 should facilitate the transition 
of promoting more tractor-trailer integration. ACEEE recommended 
providing manufacturers the option to test tractors with advanced 
trailers; correct the test result appropriately to account for the 
benefit provided by the trailer alone to promote integration of 
aerodynamically advanced tractors and trailers. UCS raised concerns 
that because tractors and trailers are interchangeable and that there 
is no guarantee that the Phase 2 tractors will pull the newest 
trailers, therefore, the agencies should not revise the standard 
trailer over the course of the rule.
    The agencies re-evaluated the proposal to include trailer skirts on 
the Phase 2 reference trailer with consideration of the comments. Based 
on testing conducted to support the trailer portion of Phase 2, we 
found that on average a boat tail added to a dry van trailer with 
skirts reduces wind averaged CdA by 0.6 m\2\.\314\ We still 
project that the bulk of trailers that will be in operation during the 
life of tractors produced early in Phase 2 will be represented by the 
aerodynamic performance of a trailer with skirts. Therefore, we are 
adopting the reference trailer as proposed. However, we also want to 
recognize that the trailer fleet will continue to evolve over the 
lifetime of tractors built and certified to Phase 2, especially from MY 
2027 and later. We recognize that if we do not account for reduced 
aerodynamic loads in the real world, then we may not be appropriately 
evaluating the tractor powertrain. We considered changing the standard 
trailer in MY 2027; however, this would lead to significant testing 
burden for the manufacturers because they would have to determine new 
CdA values for their entire fleet of tractors. Instead, we 
are adopting Phase 2 GEM that beginning in MY 2027 will take the 
CdA input for each vehicle and reduce it by 0.3 m\2\ to 
reflect the lower aerodynamic loads that are a mix of trailers with 
skirts and trailers with skirts and boat tails. This change has been 
accounted for in both the baseline and standard setting of the 
CO2 emissions and fuel consumption values.
---------------------------------------------------------------------------

    \314\ See RIA Chapter 2.10.2.1.3.
---------------------------------------------------------------------------

    With respect to ACEEE's recommendation for the agencies to 
facilitate the transition to more integrated tractor-trailers, such as 
those demonstrated with SuperTruck, the agencies believe this would 
require a significant change in tractor-trailer logistics to encourage 
more matching of specific tractors to specific trailers in operation. 
We believe that this would be most appropriately handled through the 
Off-Cycle Credit program.
(viii) Aerodynamic Bins
    The agencies proposed to continue the approach where the 
manufacturer would determine a tractor's aerodynamic drag force through 
testing, determine the appropriate predefined aerodynamic bin, and then 
input the predefined CdA value for that bin into the GEM. 80 
FR 40245. The agencies' Phase 2 aerodynamic bins reflect three changes 
to the Phase 1 bins--the incorporation of wind averaged drag, the 
addition of trailer skirts to the standard box trailer used to 
determine the aerodynamic performance of high roof tractors (as just 
explained above), and the addition of bins to reflect the continued 
improvement of tractor aerodynamics in the future. Because of each of 
these changes, the aerodynamic bins for Phase 2 are not directly 
comparable to the Phase 1 bins.
    HD Phase 1 included five aerodynamic bins to cover the spectrum of 
aerodynamic performance of high roof tractors. Since the development of 
the Phase 1 rules, the manufacturers have continued to invest in 
aerodynamic improvements for tractors. This continued evolution of 
aerodynamic performance, both in

[[Page 73630]]

production and in the research stage as part of the SuperTruck program, 
has consequently led the agencies to propose two additional aerodynamic 
technology bins (Bins VI and VII) for high roof tractors.
    In both HD Phase 1 and Phase 2, aerodynamic Bin I through Bin V 
represent tractors sharing similar levels of technology. The first high 
roof aerodynamic category, Bin I, is designed to represent tractor 
bodies which prioritize appearance or special duty capabilities over 
aerodynamics. These Bin I tractors incorporate few, if any, aerodynamic 
features and may have several features that detract from aerodynamics, 
such as bug deflectors, custom sunshades, B-pillar exhaust stacks, and 
others. The second high roof aerodynamics category is Bin II, which 
roughly represents the aerodynamic performance of the average new 
tractor sold in 2010. The agencies developed this bin to incorporate 
conventional tractors that capitalize on a generally aerodynamic shape 
and avoid classic features that increase drag. High roof tractors 
within Bin III build on the basic aerodynamics of Bin II tractors with 
added components to reduce drag in the most significant areas on the 
tractor, such as integral roof fairings, side extending gap reducers, 
fuel tank fairings, and streamlined grill/hood/mirrors/bumpers, similar 
to 2013 model year SmartWay tractors. The Bin IV aerodynamic category 
for high roof tractors builds upon the Bin III tractor body with 
additional aerodynamic treatments such as underbody airflow treatment, 
down exhaust, and lowered ride height, among other technologies. HD 
Phase 1 Bin V tractors incorporate advanced technologies which are 
currently in the prototype stage of development, such as advanced gap 
reduction, rearview cameras to replace mirrors, wheel system 
streamlining, and advanced body designs. For HD Phase 2, the agencies 
proposed to segment the aerodynamic performance of these advanced 
technologies into Bins V through VII.
    In Phase 1, the agencies adopted only two aerodynamic bins for low 
and mid roof tractors. The agencies limited the number of bins to 
reflect the actual range of aerodynamic technologies effective in low 
and mid roof tractor applications. High roof tractors are consistently 
paired with box trailer designs, and therefore manufacturers can design 
the tractor aerodynamics as a tractor-trailer unit and target specific 
areas like the gap between the tractor and trailer. In addition, the 
high roof tractors tend to spend more time at high speed operation 
which increases the impact of aerodynamics on fuel consumption and GHG 
emissions. On the other hand, low and mid roof tractors are designed to 
pull variable trailer loads and shapes. They may pull trailers such as 
flat bed, low boy, tankers, or bulk carriers. The loads on flat bed 
trailers can range from rectangular cartons with tarps, to a single 
roll of steel, to a front loader. Due to these variables, manufacturers 
do not design unique low and mid roof tractor aerodynamics but instead 
use derivatives from their high roof tractor designs. The aerodynamic 
improvements to the bumper, hood, windshield, mirrors, and doors are 
developed for the high roof tractor application and then carried over 
into the low and mid roof applications. As mentioned above, the types 
of designs that will move high roof tractors from a Bin III to Bins IV 
through V include features such as gap reducers and integral roof 
fairings which will not be appropriate on low and mid roof tractors.
    As Phase 2 looks to further improve the aerodynamics for high roof 
sleeper cabs, we believe it is also appropriate to expand the number of 
bins for low and mid roof tractors too. For Phase 2, the agencies 
proposed to differentiate the aerodynamic performance for low and mid 
roof applications with four bins, instead of two, in response to 
feedback received from manufacturers of low and mid roof tractors 
related to the limited opportunity to incorporate certain aerodynamic 
technologies in their compliance plan. However, upon further 
discussions with EMA, it became evident to the agencies that the most 
straightforward approach would be to include the same number of low and 
mid roof aero bins as we have for high roof tractors.\315\ Therefore, 
we are adopting seven aero bins for low and mid roof tractors in Phase 
2. In addition, we proposed and are adopting provisions that allow low 
and mid roof tractor aerodynamic bins to be determined based on the 
aerodynamic bin of an equivalent high roof tractor, as shown below in 
Table III-31.
---------------------------------------------------------------------------

    \315\ Memo to Docket. Aerodynamic Subteam Meetings with EMA. 
July 2016. Docket EPA-HQ-OAR-2014-0827.

        Table III-31--Phase 2 Revisions to 40 CFR 1037.520(b)(3)
------------------------------------------------------------------------
               High roof bin                    Low and mid  roof bin
------------------------------------------------------------------------
Bin I.....................................  Bin I.
Bin II....................................  Bin II.
Bin III...................................  Bin III.
Bin IV....................................  Bin IV.
Bin V.....................................  Bin V.
Bin VI....................................  Bin VI.
Bin VII...................................  Bin VII.
------------------------------------------------------------------------

    The agencies developed new high roof tractor aerodynamic bins for 
Phase 2 that reflect the change from zero yaw to wind averaged drag, 
the more aerodynamic reference trailer, and the addition of two bins. 
Details regarding the derivation of the high roof bins are included in 
RIA Chapter 3.2.1.2. The high roof bin values being adopted in the HD 
Phase 2 final rulemaking differ from those proposed due to the 
coastdown and other aerodynamic test procedures changes discussed above 
in Section III.E.2.a. However, as explained above in Section III.D.1, 
in both the NPRM and this final rulemaking, we developed the Phase 2 
bins such that there is an alignment between the Phase 1 and Phase 2 
aerodynamic bins after taking into consideration the changes in 
aerodynamic test procedures and reference trailers required in Phase 2. 
The Phase 2 bins were developed so that a tractor that performed as a 
Bin III in Phase 1 would also perform as a Bin III tractor in Phase 2. 
The high roof tractor bins are defined in Table III-32. The final 
revisions to the low and mid roof tractor bins reflect the addition of 
five new aerodynamic bins and are listed in Table III-33.

[[Page 73631]]



                Table III-32--Phase 2 Aerodynamic Input Definitions to GEM for High Roof Tractors
----------------------------------------------------------------------------------------------------------------
                                                                      Class 7                 Class 8
                                                                 -----------------------------------------------
                                                                      Day cab         Day cab       Sleeper cab
                                                                 -----------------------------------------------
                                                                     High roof       High roof       High roof
----------------------------------------------------------------------------------------------------------------
                                    Aerodynamic Test Results (CdAwad in m\2\)
----------------------------------------------------------------------------------------------------------------
Bin I...........................................................           >=7.2           >=7.2           >=6.9
Bin II..........................................................         6.6-7.1         6.6-7.1         6.3-6.8
Bin III.........................................................         6.0-6.5         6.0-6.5         5.7-6.2
Bin IV..........................................................         5.5-5.9         5.5-5.9         5.2-5.6
Bin V...........................................................         5.0-5.4         5.0-5.4         4.7-5.1
Bin VI..........................................................         4.5-4.9         4.5-4.9         4.2-4.6
Bin VII.........................................................           <=4.4           <=4.4           <=4.1
----------------------------------------------------------------------------------------------------------------
                                    Aerodynamic Input to GEM (CdAwad in m\2\)
----------------------------------------------------------------------------------------------------------------
Bin I...........................................................            7.45            7.45            7.15
Bin II..........................................................            6.85            6.85            6.55
Bin III.........................................................            6.25            6.25            5.95
Bin IV..........................................................            5.70            5.70            5.40
Bin V...........................................................            5.20            5.20            4.90
Bin VI..........................................................            4.70            4.70            4.40
Bin VII.........................................................            4.20            4.20            3.90
----------------------------------------------------------------------------------------------------------------


                                Table III-33--Phase 2 Aerodynamic Input Definitions to GEM for Low and Mid Roof Tractors
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Class 7                                         Class 8
                                                         -----------------------------------------------------------------------------------------------
                                                                      Day cab                         Day cab                       Sleeper Cab
                                                         -----------------------------------------------------------------------------------------------
                                                             Low roof        Mid roof        Low roof        Mid roof        Low roof        Mid roof
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Aerodynamic Test Results (CdA in m\2\)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin I...................................................      [gteqt]5.4      [gteqt]5.9      [gteqt]5.4      [gteqt]5.9      [gteqt]5.4      [gteqt]5.9
Bin II..................................................         4.9-5.3         5.5-5.8         4.9-5.3         5.5-5.8         4.9-5.3         5.5-5.8
Bin III.................................................         4.5-4.8         5.1-5.4         4.5-4.8         5.1-5.4         4.5-4.8         5.1-5.4
Bin IV..................................................         4.1-4.4         4.7-5.0         4.1-4.4         4.7-5.0         4.1-4.4         4.7-5.0
Bin V...................................................         3.8-4.0         4.4-4.6         3.8-4.0         4.4-4.6         3.8-4.0         4.4-4.6
Bin VI..................................................         3.5-3.7         4.1-4.3         3.5-3.7         4.1-4.3         3.5-3.7         4.1-4.3
Bin VII.................................................           <=3.4           <=4.0           <=3.4           <=4.0           <=3.4           <=4.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Aerodynamic Input to GEM (CdA in m\2\)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin I...................................................            6.00            7.00            6.00            7.00            6.00            7.00
Bin II..................................................            5.60            6.65            5.60            6.65            5.60            6.65
Bin III.................................................            5.15            6.25            5.15            6.25            5.15            6.25
Bin IV..................................................            4.75            5.85            4.75            5.85            4.75            5.85
Bin V...................................................            4.40            5.50            4.40            5.50            4.40            5.50
Bin VI..................................................            4.10            5.20            4.10            5.20            4.10            5.20
Bin VII.................................................            3.80            4.90            3.80            4.90            3.80            4.90
--------------------------------------------------------------------------------------------------------------------------------------------------------

(ix) Selective Enforcement Audits (SEA) and Confirmatory Testing for 
Aerodynamics
    EPA has long required manufacturers to perform SEAs to verify that 
actual production engines and vehicles conform to their certificates. 
Before this rulemaking, the regulations in 40 CFR 1037.301 provided 
generally for SEAs for Phase 1 vehicles, but did not provide specific 
descriptions of how such testing would be conducted for coastdowns. In 
Phase 1, we adopted interim provisions in 40 CFR 1037.150(k) that 
accounted for coastdown measurement variability by allowing a 
compliance demonstration based on in-use test results if the drag area 
was at or below the maximum drag area allowed for the bin above the bin 
to which the vehicle was certified. Since adoption of Phase 1, EPA has 
conducted in-use aerodynamic testing and found that uncertainty 
associated with coastdown testing is less than anticipated.\316\ In 
addition, as noted earlier in this Section III.E.(2)(a), we proposed 
and are adopting additional enhancements in the Phase 2 coastdown 
procedures to continue to reduce the variability of coastdown results, 
including the impact of environmental conditions. Therefore, we are 
sunsetting the provision in 40 CFR 1037.150(k) at the end of the Phase 
1 program (after the 2020 model year). In the NPRM, we proposed a 
conventional approach to conducting SEAs with respect to aerodynamics. 
See 80 FR at 40156 and proposed section 1037.301. We requested comment 
on whether or not we should factor in a test variability compliance 
margin into the aerodynamic test procedure, and

[[Page 73632]]

therefore requested data on aerodynamic test variability.
---------------------------------------------------------------------------

    \316\ Southwest Research Institute. ``Heavy Duty Class 8 Truck 
Coastdown and Constant Speed Testing.'' April 2015.
---------------------------------------------------------------------------

    The agencies received comments from manufacturers arguing for the 
agencies to establish compliance margins that would allow actual 
production vehicles to exceed the standards by some fixed amount. These 
comments included specific requests for an aerodynamic compliance 
margin. We also received comments from UCS supporting the elimination 
of the aerodynamic compliance margin. As explained in Section I.C.1, 
although EPA sometimes provides interim compliance margins to 
facilitate the initial implementation of new programs, we generally do 
not consider such an approach to be an appropriate long-term policy. 
Nevertheless, EPA recognizes that compliance testing relying on 
coastdowns to evaluate aerodynamic parameters differs fundamentally 
from traditional compliance testing, in which test-to-test variability 
is normally expected to be small relative to production variability. 
With coastdown testing, however, test-to-test variability is expected 
to be larger relative to production variability. In response to 
comments addressing this difference, EPA developed a different 
structure for conducting SEAs to evaluate tractor CdA s and 
solicited supplemental comments on it. See 81 FR 10825. This new 
structure reflects an approach that would be consistent with the 
following principles:
     Test-to-test variability for individual coastdown runs can 
be high, so compliance determinations should be based on average values 
from multiple runs.
     Coastdown testing of a single vehicle is expensive and 
time consuming, so testing should focus more on repeat tests for the 
same vehicle than on tests for multiple vehicles. However, 
manufacturers should not be required to conduct more than 100 valid 
coastdown runs on any single vehicle.
     Compliance determinations should be based on whether or 
not the true value for the CdA falls within the bin to which 
the vehicle was certified, rather than on whether or not the true value 
for the CdA exceeds the value measured for certification.
     Given the limited ability to eliminate uncertainty, 
compliance determinations should consider the statistical confidence 
that a true value lies outside a bin.
    Commenters were generally very supportive of these principles and 
the proposed structure.
    We believe the structure being finalized appropriately balances 
EPA's need to provide strong incentives for manufacturers to act in 
good faith with manufacturers' need to avoid compliance actions based 
on inaccurate testing. Our current assessment is that, where a 
manufacturer acts in good faith when certifying and uses good 
engineering judgment throughout the process, false failures for 
individual vehicles would be rare and false failures for a family would 
not occur.
    Under this approach, EPA would select a production vehicle for 
coastdown testing, and the manufacturer would be required to perform up 
to 100 valid coastdown runs to demonstrate whether or not the vehicle 
was certified to the correct bin. The coastdown results must be 
adjusted to a yaw angle of 4.5[deg] using an alternate aerodynamic 
method. EPA will address uncertainty in the measurement using a 
confidence interval around the mean CdA value, where the 
confidence interval will be calculated from the standard deviation of 
the CdA values ([sigma]) and the number of runs (n) 
according to the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.008

    For example, the result of the testing could be a CdA 
value of 5.90  0.09, which would fall entirely within Bin 
III for high roof sleeper cabs.\317\ If the vehicle had been certified 
to Bin III or lower, this would be considered a passing test. If it had 
been certified to Bin IV or higher, this would be considered a failing 
test. For each vehicle that fails, the manufacturer would be required 
to test two additional vehicles up to a maximum of 11 vehicles. 
Manufacturers would have the option to select the same vehicle 
configuration, or they could choose to have EPA select another 
configuration within the family. It is appropriate to allow 
manufacturers the opportunity to retest the same failed configurations 
because they would only do so where there had reasonable confidence 
that the failure did not accurately reflect the true value.
---------------------------------------------------------------------------

    \317\ As specified in 40 CFR 1037.305, bin boundaries for this 
determination are expressed to two decimal places and adjusted for 
rounding effects.
---------------------------------------------------------------------------

    The regulations require that manufacturers continue testing until 
the results are clearly either above or below the applicable bin 
boundary (i.e., the confidence interval does not cross the boundary), 
or until 100 runs are completed. By making the confidence interval a 
function of the number of runs, it will generally become smaller as 
additional runs are completed, so that it would be increasingly likely 
to have a clear result as additional runs are completed. Nevertheless, 
there may be some cases where the results are close enough to the bin 
boundary that the confidence interval still crosses the boundary after 
100 runs, meaning the true CdA value could be slightly above 
or slightly below the bin boundary. The regulations will treat these 
results as passing.
    It is important to note that, although SEAs are directed by EPA, 
the actual testing is conducted by the manufacturer at their chosen 
facilities. This minimizes many potential causes of test variability, 
such as differences in test trailers, test tracks, or instrumentation. 
Thus confidence intervals need only reflect true test-to-test 
variability. Also, manufacturers generally rent facilities for 
coastdown testing as needed, which means EPA will need to provide some 
advance notice to allow the manufacturer to reserve the appropriate 
facility.
    In selecting the original configuration and subsequent selections, 
EPA would likely consider vehicles with measured CdA values 
near the top of the bin since they could be most the likely to be mis-
certified based on inaccurate results. However, EPA could select any 
configuration. For subsequent testing if the first vehicle fails, 
manufacturers would be allowed to retest the same configuration (but 
not the same exact vehicle). EPA believes this would not decrease the 
risk of failure for subsequent vehicles, but could allow a manufacturer 
the opportunity to show its design was actually compliant.
    With respect to confirmatory testing, which is testing EPA conducts 
during certification rather than during production, EPA has generally

[[Page 73633]]

considered its test results to be the official test results. However, 
we recognize that we need to treat confirmation of a manufacturer's 
Falt-aero differently because small changes in its value 
would be spread over an entire family. Therefore, EPA is adopting an 
interim provision that would apply the SEA confidence interval approach 
for confirmatory testing with respect to Falt-aero. EPA 
would also attempt to use the same test trailers, test locations, and 
instrumentation that the manufacturer. Nevertheless, we expect to 
revisit this issue in the future.
(b) Road Grade in the Drive Cycles
    Road grade can have a significant impact on the overall fuel 
economy of a heavy-duty vehicle. Table III-34 shows the results from a 
real world evaluation of heavy-duty tractor-trailers conducted by Oak 
Ridge National Lab.\318\ The study found that the impact of a mild 
upslope of one to four percent led to a decrease in average fuel 
economy from 7.33 mpg to 4.35 mpg. These results are as expected 
because vehicles consume more fuel while driving on an upslope than 
driving on a flat road because the vehicle needs to exert additional 
power to overcome the grade resistance force.\319\ The amount of extra 
fuel increases with increases in road gradient. On downgrades, vehicles 
consume less fuel than on a flat road. However, as shown in the fuel 
consumption results in Table III-34, the amount of increase in fuel 
consumption on an upslope is greater than the amount of decrease in 
fuel consumption on a downslope which leads to a net increase in fuel 
consumption. As an example, the data show that a vehicle would use 0.3 
gallons per mile more fuel in a severe upslope than on flat terrain, 
but only save 0.1 gallons of fuel per mile on a severe downslope. In 
another study, Southwest Research Institute modeling found that the 
addition of road grade to a drive cycle has an 8 to 10 percent negative 
impact on fuel economy.\320\
---------------------------------------------------------------------------

    \318\ Oakridge National Laboratory. Transportation Energy Book, 
Edition 33. Table 5.10 Effect of Terrain on Class 8 Truck Fuel 
Economy. 2014. Last accessed on September 19, 2014 at http://cta.ornl.gov/data/Chapter5.shtml.
    \319\ Ibid.
    \320\ Reinhart, T. (February 2016). Commercial Medium- and 
Heavy-Duty (MD/HD) Truck Fuel Efficiency Technology Study--Report 
#2. Washington, DC: National Highway Traffic Safety Administration. 
EPA-HQ-OAR-2014-0827-1623.

          Table III-34--Fuel Consumption Relative to Road Grade
------------------------------------------------------------------------
                                                  Average
                                                    fuel    Average fuel
                                                  economy    consumption
                Type of terrain                    (miles   (gallons per
                                                    per         mile)
                                                  gallon)
------------------------------------------------------------------------
Severe upslope (>4%)...........................       2.90          0.34
Mild upslope (1% to 4%)........................       4.35          0.23
Flat terrain (1% to 1%)........................       7.33          0.14
Mild downslope (-4% to -1%)....................      15.11          0.07
Severe downslope (<=4%)........................      23.50          0.04
------------------------------------------------------------------------

    In Phase 1, the agencies did not include road grade. However, we 
believe it is important to include road grade in Phase 2 to properly 
assess the value of technologies, such as downspeeding and the 
integration of the engine and transmission, which were not technologies 
included in the technology basis for Phase 1 and are not directly 
assessed by GEM in its Phase 1 iteration. The addition of road grade to 
the drive cycles is consistent with the NAS recommendation in the 2014 
Phase 2 First Report.\321\
---------------------------------------------------------------------------

    \321\ National Academy of Science. ``Reducing the Fuel 
Consumption and GHG Emissions of Medium- and Heavy-Duty Vehicles, 
Phase Two, First Report.'' 2014. Recommendation S.3 (3.6).
---------------------------------------------------------------------------

    The U.S. Department of Energy and EPA partnered to support a 
project to develop the appropriate road grade profiles for the 55 mph 
and 65 mph highway cruise duty cycles that will be used in the 
certification of heavy-duty vehicles to the Phase 2 final GHG emission 
and fuel efficiency standards. The National Renewable Energy Laboratory 
(NREL) was contracted to do this work and has developed a database of 
activity-weighted percent road grades representative of U.S. limited-
access highways. To this end, NREL used high-accuracy road grade data 
and county-specific vehicle miles traveled data. A report documenting 
this NREL work is in the public docket for these final rules.\322\
---------------------------------------------------------------------------

    \322\ See NREL Report ``EPA Road Grade profiles'' for DOE-EPA 
Interagency Agreement to Refine Drive Cycles for GHG Certification 
of Medium- and Heavy-Duty Vehicles, IA Number DW-89-92402501.
---------------------------------------------------------------------------

    In the Phase 2 proposal, the agencies developed an interim road 
grade profile and provided information in the docket on two NREL-
derived road grade profiles. The agencies proposed the inclusion of an 
interim road grade profile, in both the 55 mph and 65 mph cycles. The 
grade profile was developed by Southwest Research Institute on a 12.5 
mile stretch of restricted-access highway during on-road tests 
conducted for EPA's validation of the Phase 2 version of GEM.\323\ The 
agencies also included an additional road grade profile as part of the 
Notice of Data Availability (81 FR at 10825). The agencies sought 
comment on all of the road grade profiles.
---------------------------------------------------------------------------

    \323\ Southwest Research Institute. ``GEM Validation,'' 
Technical Research Workshop supporting EPA and NHTSA Phase 2 
Standards for MD/HD Greenhouse Gas and Fuel Efficiency--December 10 
and 11, 2014. Can be accessed at http://www3.epa.gov/otaq/climate/regs-heavy-duty.htm.
---------------------------------------------------------------------------

    Cummins supported the development of road grade and stated that the 
proposed road grade with 2 percent did not reflect their 
assessment of the distribution of North American roads with a 
distribution of road grades of 6 percent. ACEEE supported 
inclusion of road grade. Daimler, Navistar, EMA, Volvo, and Eaton 
commented that the road grade profile presented in the NODA were too 
steep and did not represent real world driving. Their primary concern 
was related to the fraction of time the engine spent at full load for 
various vehicle configurations. According to the manufacturers, the 
road grade cycle presented in GEM in the NODA spent too high of a 
fraction of time at full load.
    After considering the road grade profile comments and using the 
NREL database, the agencies have independently developed a road grade 
profile for the final rules for use in the 55 mph and 65 mph highway 
cruise duty cycles for the Phase 2 final rulemaking. While based on the 
same road grade database generated by NREL for U.S. restricted-access 
highways, its design is predicated on a different approach. The 
development of this profile is documented in the RIA Chapter 3.4.2.1. 
The road grade in the final rules includes a stretch with zero percent 
grade and lower peak grades than the profile presented in the NODA. The 
minimum grade in the final cycle is -5 percent and the maximum grade is 
5 percent. The cycle spends 46 percent of the distance in grades of 
 0.5 percent. Overall, the cycle spends approximately 66 
percent of the time in relatively flat terrain with road gradients of 
 1 percent. A detailed discussion of the road grade profile 
is included in RIA Chapter 3.4.2.1.
(c) Heavy-Haul Provisions
    The agencies proposed that heavy-haul tractors demonstrate 
compliance with the standards using the day cab drive cycle weightings 
of 19 percent transient cycle, 17 percent 55 mph cycle, and 64 percent 
65 mph cycle. We also proposed that GEM simulates the heavy-haul 
tractors with a payload of 43

[[Page 73634]]

tons and a total tractor, trailer, and payload weight of 118,500 lbs. 
In addition, we proposed that the engines installed in heavy-haul 
tractors meet the tractor engine standards included in 40 CFR 1036.108. 
We welcomed comments on these specifications.
    Volvo does not agree with the proposal that the engine installed in 
a heavy-haul tractor must meet the tractor engine standard defined in 
40 CFR 1036.108. As discussed below in Section III.E.2.i, we have 
modified 40 CFR 1037.601(a)(1) in this final rulemaking to remove the 
prohibition of using vocational engines in tractors.
(d) Weight Reduction
    In Phase 1, the agencies adopted regulations that provided 
manufacturers with the ability to use GEM to measure emission reduction 
and reductions in fuel consumption resulting from use of high strength 
steel and aluminum components for weight reduction, and to do so 
without the burden of entering the curb weight of every tractor 
produced. We treated such weight reduction in two ways in Phase 1 to 
account for the fact that combination tractor-trailers weigh-out 
approximately one-third of the time and cube-out approximately two-
thirds of the time. Therefore, one-third of the weight reduction is 
added payload in the denominator while two-thirds of the weight 
reduction is subtracted from the overall weight of the vehicle in GEM. 
See 76 FR 57153. The agencies also allowed manufacturers to petition 
for off-cycle credits for components not measured in GEM.
    NHTSA and EPA proposed to carry the Phase 1 treatment of weight 
reduction into Phase 2. That is, these types of weight reduction, 
although not part of the agencies' technology packages for the final 
standards, can still be recognized in GEM up to a point. In addition, 
the agencies proposed to add additional thermoplastic components to the 
weight reduction table. The thermoplastic component weight reduction 
values were developed in coordination with SABIC, a thermoplastic 
component supplier. Also, in Phase 2, we proposed to recognize the 
potential weight reduction opportunities in the powertrain and 
drivetrain systems as part of the vehicle inputs into GEM. Therefore, 
we believe it is appropriate to also recognize the weight reduction 
associated with both smaller engines and 6x2 axles.\324\ We welcomed 
comments on all aspects of weight reduction. 80 FR 40249.
---------------------------------------------------------------------------

    \324\ North American Council for Freight Efficiency. 
``Confidence Findings on the Potential of 6x2 Axles.'' 2014. Page 
16.
---------------------------------------------------------------------------

    Several organizations suggested changes to specific weights 
proposed in the NPRM. The Aluminum Association cited several additional 
advancements in the aluminum industry and stated that the proposed 
table is appropriate when these components are considered for 
substitution on an individual basis. Aluminum Association also asked 
the agencies to add a 500 pound weight reduction for switching from 
steel to aluminum tractor cabs, among other components. Meritor 
supported the inclusion and expansion of the weight reduction 
technologies in the NPRM. Meritor suggested the aluminum carriers 
illustrate consistent weight reductions of 60 pounds for the rear-
front-drive axle, 35 pounds for the rear-rear-drive axle and therefore 
95 pounds for the tandem. Based on their data, Meritor recommends that 
a 42 pound weight savings be credited per tractor for using High-
Strength steel drums on the steer (non-drive) axle and 74 pound per 
vehicle for 6x4 drive axle applications. Meritor anticipates the 
availability of an aluminum version of a brake bracket in the timeframe 
of the regulation which will provide a calculated per vehicle weight 
savings of 36 pounds for a 6x4 configuration. Meritor believes that 
weight savings should be credited for the use of single-piece 
drivelines in excess of 86 because today, most drivelines in 
excess of 86 are two piece. American Iron and Steel 
Institute commented that light weight values for high strength steel 
should be adjusted upward in the FRM, citing light duty vehicle weight 
reduction approaches using high strength steel and saying these 
improvements should apply to the heavy-duty sector as well. Daimler 
commented that increased credit should be given to hoods and fairings 
for the difference between steel and thermoplastic, but no specific 
values were provided. PACCAR recommends that the agencies broaden the 
definition of ``composite'' to include materials other than 
thermoplastics, including thermoplastics, thermosets, and fiber 
reinforced plastics.
    Some organizations commented against including some or all light-
weight components for compliance with the tractor standards. American 
Iron and Steel Institute commented against the inclusion of any light-
weight components as a compliance mechanism for tractors unless 
improved technical data to support the weight saving values are used. 
Daimler commented that the weight reduction values for engines less 
than 15 liters are arbitrary. Allison commented that the agencies 
should establish weight penalties for components that increase weight, 
and they used the example of MT/AMT with countershaft architectures.
    We have expanded the list of weight reduction technologies for some 
steel and aluminum components for the final rule based on information 
provided in the comments. We did not adopt weight reduction values for 
some components, such as an axle carrier, because we are not confident 
that this is not double counting the weight reduction of the axles 
already provided in the regulations. We also did not adopt weight 
reduction values for technologies still in development, such as 
aluminum brake brackets. The agencies are not finalizing a weight 
penalty for any components since this would require detailed 
information on conventional and light-weight tractor components to 
establish a baseline and the weight reduction potential for each 
component. In addition, we are not broadening the definition of 
composite at this time to include materials other than thermoplastics 
because the specific weight reduction values in the table are specific 
to thermoplastics. We are adopting the values listed in Table III-35 
and Table III-36 and making them available upon promulgation of the 
final Phase 2 rules (i.e., available even under Phase 1). Additional 
weight reduction would be evaluated as a potential off-cycle credit.

    Table III-35--Phase 2 Weight Reduction Technologies for Tractors
------------------------------------------------------------------------
   Weight reduction technology                Weight reduction
------------------------------------------------------------------------
Wide-Based Single Drive Tire
 with:
    Steel Wheel..................  84 lbs. per wheel/tire set.
    Aluminum Wheel/Aluminum Alloy  147 lbs. per wheel/tire set.
     Wheel.

[[Page 73635]]

 
Wide-Based Single Trailer Tire
 with:
    Steel Wheel..................  84 lbs. per wheel/tire set.
    Aluminum Wheel/Aluminum Alloy  131 lbs. per wheel/tire set.
     Wheel.
Steer Tire or Dual Wide Drive
 Tire with:
    High Strength Steel Wheel....  8 lbs. per wheel.
    Aluminum Wheel/Aluminum Alloy  25 lbs. per wheel.
     Wheel.
------------------------------------------------------------------------


----------------------------------------------------------------------------------------------------------------
                                                                     Aluminum      High strength   Thermoplastic
                                                                      weight       steel weight       weight
          Weight reduction technologies             Steel (lb.)      reduction       reduction       reduction
                                                                       (lb.)           (lb.)           (lb.)
----------------------------------------------------------------------------------------------------------------
Door (per door).................................  ..............              20               6  ..............
Roof (per vehicle)..............................  ..............              60              18  ..............
Cab rear wall (per vehicle).....................  ..............              49              16  ..............
Cab floor (per vehicle).........................  ..............              56              18  ..............
Hood (per vehicle)..............................  ..............              55              17  ..............
Hood Support Structure (per vehicle)............  ..............              15               3  ..............
Hood and Front Fender (per vehicle).............  ..............  ..............  ..............              65
Day Cab Roof Fairing (per vehicle)..............  ..............  ..............  ..............              18
Sleeper Cab Roof Fairing (per vehicle)..........  ..............              75              20              40
Aerodynamic Side Extender (per vehicle).........  ..............  ..............  ..............              10
Fairing Support Structure (per vehicle).........  ..............              35               6  ..............
Instrument Panel Support Structure (per vehicle)  ..............               5               1  ..............
Brake Drums--Drive (per 4)......................  ..............             140              74  ..............
Brake Drums--Non Drive (per 2)..................  ..............              60              42  ..............
Frame Rails (per vehicle).......................  ..............             440              87  ..............
Crossmember--Cab (per vehicle)..................  ..............              15               5  ..............
Crossmember--Suspension (per vehicle)...........  ..............              25               6  ..............
Crossmember--Non Suspension ( per 3)............  ..............              15               5  ..............
Fifth Wheel (per vehicle).......................  ..............             100              25  ..............
Radiator Support (per vehicle)..................  ..............              20               6  ..............
Fuel Tank Support Structure (per vehicle).......  ..............              40              12  ..............
Steps (per vehicle).............................  ..............              35               6  ..............
Bumper (per vehicle)............................  ..............              33              10  ..............
Shackles (per vehicle)..........................  ..............              10               3  ..............
Front Axle (per vehicle)........................  ..............              60              15  ..............
Suspension Brackets, Hangers (per vehicle)......  ..............             100              30  ..............
Transmission Case (per vehicle).................  ..............              50              12  ..............
Clutch Housing (per vehicle)....................  ..............              40              10  ..............
Drive Axle Hubs (per 4).........................  ..............              80              20  ..............
Non Drive Front Hubs (per 2)....................  ..............              40               5  ..............
Single Piece Driveline (for drivelines longer                 43              63              43  ..............
 than 86'').....................................
Driveshaft (per vehicle)........................  ..............              20               5  ..............
Transmission/Clutch Shift Levers (per vehicle)..  ..............              20               4  ..............
----------------------------------------------------------------------------------------------------------------


   Table III-36--Phase 2 Weight Reduction Values for Other Components
------------------------------------------------------------------------
                                                                Weight
                 Weight reduction technology                   reduction
                                                                 (lb)
------------------------------------------------------------------------
6x2 axle configuration in tractors..........................         300
4x2 axle configuration in Class 8 tractors..................         300
Tractor engine with displacement less than 14.0L............   \325\ 300
------------------------------------------------------------------------

(e) GEM Inputs
---------------------------------------------------------------------------

    \325\ Kenworth. ``Kenworth T680 with PACCAR MX-13 Engine Lowers 
Costs for Oregon Open-Deck Carrier.'' Last viewed on December 16, 
2014 at http://www.kenworth.com/news/news-releases/2013/december/t680-cotc.aspx.
---------------------------------------------------------------------------

    The agencies proposed to continue to require the Phase 1 GEM inputs 
for tractors in Phase 2. These inputs include the following:
     Steer tire rolling resistance,
     Drive tire rolling resistance,
     Coefficient of Drag Area,
     Idle reduction,
     Weight reduction, and
     Vehicle Speed Limiter.
    As discussed above in Section II.C and III.D, there are several 
additional inputs that we are adopting for Phase 2. The majority of 
these new inputs are the same as proposed, with the addition of two new 
optional inputs to account for transmission and axle efficiency 
improvements in response to comments. The new GEM inputs for Phase 2 
include the following:
     Engine information including manufacturer, model, 
combustion type, fuel type, family name, and calibration 
identification,
     Engine steady state and cycle average fuel maps,
     Engine full-load torque curve,
     Engine motoring curve,
     Transmission information including manufacturer and model,
     Transmission type,
     Transmission gear ratios,
     Transmission loss map (optional),
     Drive axle(s) ratio,
     Axle power loss map (optional),
     Tire size (revolutions per mile) for drive tires, and
     Other technology inputs.
(f) Vehicle Speed Limiter Provisions
    The agencies received comments during the development of Phase 1 
that the Clean Air Act provisions to prevent tampering (CAA section 
203(a)(3)(A)) of vehicle speed limiters and extended idle reduction 
technologies would prohibit

[[Page 73636]]

their use for demonstrating compliance with the Phase 1 standards. In 
Phase 1, the agencies adopted provisions to allow for discounted 
credits for idle reduction technologies that allowed for override 
conditions and expiring engine shutdown systems (see 40 CFR 1037.660). 
Similarly, the agencies adopted provisions to allow for ``soft top'' 
speeds and expiring vehicle speed limiters, and we did not propose to 
change those provisions (see 40 CFR 1037.640). However, as we developed 
Phase 2, we understood that the concerns still exist that the ability 
for a tractor manufacturer to reflect the use of a VSL in its 
compliance determination may be constrained by the demand for 
flexibility in the use of VSLs by the customers. The agencies welcomed 
suggestions on how to close the gap between the provisions that would 
be acceptable to the industry while maintaining our need to ensure that 
modifications do not violate section 203(a)(3)(A). We requested comment 
on potential approaches which would enable a feedback mechanism between 
the vehicle owner/fleet that would provide the agencies the assurance 
that the benefits of the VSLs will be seen in use but would also 
provide the vehicle owner/fleet the flexibility they may need during 
in-use operation. More generally, in our discussions with several 
trucking fleets and with the American Trucking Associations, an 
interest was expressed by the fleets if there was a means by which they 
could participate in the emissions credit transactions that are 
currently limited to the directly regulated truck manufacturers. VSLs 
were an example technology that fleets and individual owners can order 
for a new build truck, and for which, from the fleets' perspective, the 
truck manufacturers receive emission credits. The agencies did not have 
a specific suggestion in the Phase 2 NPRM or a position on the request 
from the American Trucking Association and its members, but we 
requested comment on whether or not it is appropriate to allow owners 
to participate in the overall compliance process for the directly 
regulated parties, if such a thing is allowed under the two agencies' 
respective statutes, and what regulatory provisions would be needed to 
incorporate such an approach. 80 FR 40250.
    The agencies received comments regarding VSLs. ATA commented that 
the agencies should recognize in GEM VSLs set at speeds less than the 
speed limit mandated if a rule is adopted by NHTSA and FMCSA. ATA also 
suggested that the agencies should explore ways of incorporating the 
in-use benefits being derived from VSLs, such as allowing manufacturers 
to accept a purchaser's commitment to establish a maximum limited 
speed, as opposed to the tamper-proof option, when acknowledged and 
affirmed on a vehicle's purchase agreement. ATA also suggested that the 
agencies allow manufacturers to adjust VSLs at the end of a vehicle's 
lease or trade-in and allow the creation of deficits or credits if such 
adjustments affect the initial VSL effectiveness that was generated and 
allow trucking companies to adjust maximum speeds if company policies 
change during the ownership cycle with corresponding adjustment to 
manufacturer credits. CARB stated it is not clear what fleet owners 
would do with Phase 2 credits and allowing fleet owners to garner such 
credits would unnecessarily complicate implementation and enforcement 
of the Phase 2 program. As a result, CARB staff recommends not 
including owners in emission credit transactions for VSL installation. 
Daimler suggested that they report in their 270 day end of year report 
the number of VSLs that remain active. Daimler recommends that the 
agencies provide in GEM reduced effectiveness for non-regulatory VSLs 
in proportion to the fraction of non-regulatory ones that remained 
unaltered, based upon their study of their database. Volvo commented 
that approximately 15 percent of tractors built over 2013-2015 were 
shipped with their programmable road speed limiters set at less than 65 
mph from the factory and 47 percent were reported in use with the same 
setting, even during a period of very low fuel prices. Volvo Group 
requests that the agencies consider providing an effectiveness value in 
GEM for reprogrammable speed limiters set at the factory at, or below 
65 mph. UPS commented that instead of tamperproof VSLs, they would 
support a regulatory approach in which the fleet owner can adjust speed 
settings, but only if certified personnel make these changes and their 
activities within the ECIVIs are trackable and fully accountable to 
proper authorities.
    The agencies considered the comments and the compliance burden 
associated with the suggestions. The agencies also considered DOT's 
upcoming actions with respect to mandatory vehicle speed limiters for 
heavy-duty trucks. The existing Phase 1 VSL flexibilities provide 
opportunities for manufacturers to use VSL as a technology in GEM while 
still allowing the settings to change after an ``expiration'' time 
determined by the manufacturer. At this time, we believe that the Phase 
1 flexibilities sufficiently balance the desire to encourage 
technologies that reduce GHG emissions and fuel consumption while 
minimizing the compliance burden of trying to accommodate changes 
throughout the useful life of the vehicle. Therefore, the agencies are 
not adopting any new VSL provisions for Phase 2 and the Phase 1 
provisions will continue (see 40 CFR 1037.640).
(g) Emission Control Labels
    The agencies consider it crucial that authorized compliance 
inspectors are able to identify whether a vehicle is certified, and if 
so whether it is in its certified condition. To facilitate this 
identification in Phase 1, EPA adopted labeling provisions for tractors 
that included several items. The Phase 1 tractor label must include the 
manufacturer, vehicle identifier such as the Vehicle Identification 
Number (VIN), vehicle family, regulatory subcategory, date of 
manufacture, compliance statements, and emission control system 
identifiers (see 40 CFR 1037.135). In Phase 1, the emission control 
system identifiers are limited to vehicle speed limiters, idle 
reduction technology, tire rolling resistance, some aerodynamic 
components, and other innovative and advanced technologies.
    The number of emission control systems for greenhouse gas emissions 
in Phase 2 has increased significantly. For example, all aspects of the 
engine transmission and drive axle; accessories; tire radius and 
rolling resistance; wind averaged drag; predictive cruise control; idle 
reduction technologies; and automatic tire inflation systems are 
controls that can be evaluated on-cycle in Phase 2 (i.e. these 
technologies' performance can now be input to GEM), but could not be in 
Phase 1. Due to the complexity in determining greenhouse gas emissions 
as in Phase 2, the agencies do not believe that we can unambiguously 
determine whether or not a vehicle is in a certified condition through 
simply comparing information that could be made available on an 
emission control label with the components installed on a vehicle. 
Therefore, EPA proposed to remove the requirement to include the 
emission control system identifiers required in 40 CFR 1037.135(c)(6) 
and in Appendix III to 40 CFR part 1037 from the emission control 
labels for vehicles certified to the Phase 2 standards. However, the 
agencies requested comment on the appropriate content that would 
properly balance the need to limit label content with the interest in 
providing the most useful information for inspectors to

[[Page 73637]]

confirm that vehicles have been properly built. The agencies received 
comments on the emission control labels. Navistar supported the 
elimination of the emission control information from the vehicle GHG 
label. After considering the comments, EPA is finalizing the proposed 
tractor labeling requirements. Nevertheless, as described below we 
remain interested in finding a better approach for labeling.
    Under the agencies' existing authorities, manufacturers must 
provide detailed build information for a specific vehicle upon our 
request. Our expectation is that this information should be available 
to us via email or other similar electronic communication on a same-day 
basis, or within 24 hours of a request at most. The agencies have 
started to explore ideas that would provide inspectors with an 
electronic method to identify vehicles and access on-line databases 
that would list all of the engine-specific and vehicle-specific 
emissions control system information. We believe that electronic and 
Internet technology exists today for using scan tools to read a bar 
code or radio frequency identification tag affixed to a vehicle that 
could then lead to secure on-line access to a database of 
manufacturers' detailed vehicle and engine build information. Our 
exploratory work on these ideas has raised questions about the level of 
effort that would be required to develop, implement and maintain an 
information technology system to provide inspectors real-time access to 
this information. We have also considered questions about privacy and 
data security. We requested comment on the concept of electronic labels 
and database access, including any available information on similar 
systems that exist today and on burden estimates and approaches that 
could address concerns about privacy and data security. Based on new 
information that we receive, we stated in the NPRM that we may consider 
initiating a separate rulemaking effort to propose and request comment 
on implementing such an approach.
(h) End of Year Reports
    In the Phase 1 program, manufacturers participating in the ABT 
program provided 90 day and 270 day reports to EPA and NHTSA after the 
end of the model year. The agencies adopted two reports for the initial 
program to help manufacturers become familiar with the reporting 
process. For the HD Phase 2 program, the agencies proposed to simplify 
reporting such that manufacturers would only be required to submit the 
final report 90 days after the end of the model year with the potential 
to obtain approval for a delay up to 30 days. We requested comments on 
this approach. EMA, PACCAR, Navistar, Daimler, and Cummins recommended 
keeping the 270 day report to allow sufficient time after the 
production period is completed. We are accordingly keeping both the 90 
day and 270 day reports, with the ability of the agencies to waive the 
90 day report.
(i) Other Compliance Provisions
    In Phase 2, the agencies are adopting provisions to evaluate the 
performance of the engine, transmission, and drivetrain in determining 
compliance with the Phase 2 tractor standards. With the inclusion of 
the engine's performance in the vehicle compliance, EPA proposed to 
modify the prohibition to introducing into U.S. commerce a tractor 
containing an engine not certified for use in tractor (see proposed 40 
CFR 1037.601(a)(1)). During development of the Phase 2 NPRM, we no 
longer saw the need to prohibit the use of vocational engines in 
tractors because the performance of the engine would be appropriately 
reflected in GEM. We welcomed comments on removing this prohibition.
    The agencies received comments supporting the proposed approach. 
PACCAR supports removing the prohibition on the installation of 
vocational engines into tractors where these engines are appropriate 
for the customer's application. Daimler agreed with the proposal that 
with the engine properly represented in GEM, there is less need for the 
prohibition on vocational-only certified engines in tractors and that 
the true in-vehicle emissions are represented by the full-vehicle 
standard. Accordingly, we are modifying 40 CFR 1037.601(a)(1) in this 
final rulemaking to remove the prohibition of using vocational engines 
in tractors.
    The agencies also proposed to change the compliance process for 
manufacturers seeking to use the off-road exclusion. During the Phase 1 
program, manufacturers realized that contacting the agencies in advance 
of the model year was necessary to determine whether vehicles would 
qualify for exemption and need approved certificates of conformity. The 
agencies found that the petition process allowed at the end of the 
model year was not necessary and that an informal approval during the 
precertification period was more effective. Therefore, NHTSA proposed 
to remove its off-road petitioning process in 49 CFR 535.8 and EPA 
proposed to add requirements for informal approvals in 40 CFR 1037.610. 
The agencies did not receive any comments regarding the petition 
process. We are adopting the Phase 2 provisions as proposed.
    In Phase 1 and as proposed in Phase 2, the agencies allow 
manufacturers to certify vehicles into a higher service class. No 
credits can be generated from vehicles certified to the higher service 
class, but any deficit produced must be offset by credits generated 
from other vehicles within the higher service class. Though the 
agencies did not propose any changes, we received comments on the 
treatment of 4x2 tractors. EMA and the manufacturers suggest that 
tractors with a 4x2 axle configuration and a heavy heavy-duty engine 
should be classified as a Class 8 tractor regardless of GVWR and be 
included in the Class 8 averaging set. Navistar and EMA stated that 
these vehicles are typically purchased to pull multiple trailers, even 
though the GVWR is less than 33,000 pounds. In the agencies' 
assessment, we agree with the manufacturers that these vehicles 
resemble Class 8 work and due to the higher useful life requirements, 
we are adopting provisions into the Phase 2 regulations that gives all 
manufacturers the option to classify Class 7 tractors with 4x2 axle 
configurations as Class 8 tractors.
(j) Chassis Dynamometer Testing Requirement
    The agencies foresee the need to continue to track the progress of 
the Phase 2 program throughout its implementation. As discussed in 
Section II, the agencies expect to evaluate the overall performance of 
tractors with the GEM results provided by manufacturers through the end 
of year reports. However, we also need to continue to have confidence 
in our simulation tool, GEM, as the vehicle technologies continue to 
evolve. Therefore, EPA proposed that the manufacturers conduct annual 
chassis dynamometer testing of three sleeper cab tractors and two day 
cab tractors and provide the data and the GEM result from each of these 
tractor configurations to EPA (see 40 CFR 1037.665). 80 FR 40251. We 
requested comment on the costs and efficacy of this data submission 
requirement.
    In response, the agencies received mixed comments supporting and 
raising concerns about the proposed chassis test requirements. ACEEE 
and ICCT supported the proposal to conduct annual chassis testing to 
verify the relative reductions simulated in GEM and suggested that the 
results be provided to the public. UCS supported the proposal, similar 
to ACEEE and ICCT, with the additional suggestion to conduct an over 
the road testing of

[[Page 73638]]

select vehicles under real world conditions. EMA, Daimler, Volvo, 
PACCAR, and Navistar commented that they support auditing, but the 
proposed chassis testing is burdensome with few facilities available 
and will not achieve the agencies' stated goal of validating GEM's 
measure trends in the real world. Daimler and Navistar also stated that 
chassis dyno testing cannot replicate the real-world conditions for 
many technologies, such as tire pressure monitoring systems, 
intelligent coasting on grades, predictively adjusting vehicle speed on 
hills, adapting ride height at speed, using advanced cooling system 
controls, etc. Volvo raised concerns about the chassis test results due 
to driver variability, accessory loads, and the need to simulate road 
loads that comprise around 90 percent of the vehicle load in tractor 
cycles. Volvo and Daimler noted that without separate tests to quantify 
the aerodynamics and rolling resistance, which accounts for a 
significant majority of the vehicle losses, the chassis test 
essentially only evaluates the powertrain and therefore recommended 
powertrain testing for this purpose over a chassis test. The 
manufacturer's suggested that EPA conduct the testing or work 
collaboratively to develop an in-use research program. Navistar 
commented that if the provision remains for the final rule, then it be 
limited to one vehicle in 2021, 2024, and 2027 model year. Navistar 
also suggested that the final requirements do not include the proposed 
measurement of gaseous emissions due to the additional cost burden.
    After consideration of the comments, the agencies are requiring 
tractor manufacturers to annually chassis test five production vehicles 
over the GEM cycles to verify that relative reductions simulated in GEM 
are being achieved in actual production. See 40 CFR 1037.665. We do not 
expect absolute correlation between GEM results and chassis testing. 
GEM makes many simplifying assumptions that do not compromise its 
usefulness for certification, but do cause it to produce emission rates 
different from what would be measured during a chassis dynamometer 
test. Given the limits of correlation possible between GEM and chassis 
testing, we would not expect such testing to accurately reflect whether 
a vehicle was compliant with the GEM standards. Therefore, we are not 
applying compliance liability to such testing. Rather, this testing 
will be for informational purposes only. However, we do expect there to 
be correlation in a relative sense. Vehicle to vehicle differences 
showing a 10 percent improvement in GEM should show a similar percent 
improvement with chassis dynamometer testing. Nevertheless, 
manufacturers will not be subject to recall or other compliance actions 
if chassis testing did not agree with the GEM results on a relative 
basis. Rather, the agencies will continue to evaluate in-use compliance 
by verifying GEM inputs and testing in-use engines. (Note that NTE 
standards for criteria pollutants may apply for some portion of the 
test cycles.)
    EPA believes this chassis test program is necessary because of our 
experience implementing regulations for heavy-duty engines. In the 
past, manufacturers have designed engines that have much lower 
emissions on the duty cycles than occur during actual use. The recent 
experience with Volkswagen is an unfortunate instance. By using this 
simple test program, we hope to be able to identify such issues earlier 
and to dissuade any attempts to design solely to the certification 
test. We also expect the results of this testing to help inform the 
need for any further changes to GEM.
    As already noted in Section II.B.(1), it can be expensive to build 
chassis test cells for certification. However, EPA has structured this 
pilot-scale program to minimize the costs. First, this chassis testing 
will not need to comply with the same requirements as will apply for 
official certification testing. This will allow testing to be performed 
in developmental test cells with simple portable analyzers. Second, 
since the program will require only five tests per year, manufacturers 
without their own chassis testing facility will be able to contract 
with a third party to perform the testing. Finally, EPA is applying 
this testing to only those manufacturers with annual production in 
excess of 20,000 vehicles.

F. Flexibility Provisions

    EPA and NHTSA are adopting two flexibility provisions specifically 
for heavy-duty tractor manufacturers in Phase 2. These are an 
averaging, banking and trading program for CO2 emissions and 
fuel consumption credits, as well as provisions for credits for off-
cycle technologies which are not included as inputs to the GEM. Credits 
generated under these provisions can only be used within the same 
averaging set that generated the credit.
    The agencies are also modifying several Phase 1 interim provisions, 
as described below.
(1) Averaging, Banking, and Trading (ABT) Program
    Averaging, banking, and trading of emission credits have been an 
important part of many EPA mobile source programs under CAA Title II, 
and the NHTSA light-duty CAFE program. The agencies also included this 
flexibility in the HD Phase 1 program. ABT provisions are useful 
because they can help to address many potential issues of technological 
feasibility and lead-time, as well as considerations of cost. They 
provide manufacturers flexibilities that assist in the efficient 
development and implementation of new technologies and therefore enable 
new technologies to be implemented at a more aggressive pace than 
without ABT. A well-designed ABT program can also provide important 
environmental and energy security benefits by increasing the speed at 
which new technologies can be implemented. Between MYs 2013 and 2014 
all four tractor manufacturers are taking advantage of the ABT 
provisions in the Phase 1 program. NHTSA and EPA proposed to carry-over 
the Phase 1 ABT provisions for tractors into Phase 2, and are adopting 
these provisions.
    The agencies proposed and are adopting for Phase 2 the five year 
credit life and three year deficit carry-over provisions from Phase 1 
(40 CFR 1037.740(c) and 1037.745). Please see additional discussion in 
Section I.C.1.b.i. Although we did not propose any additional 
restrictions on the use of Phase 1 credits, we requested comment on 
this issue. In the NPRM, we stated that early indications suggest that 
positive market reception to the Phase 1 technologies could lead to 
manufacturers accumulating credits surpluses that could be quite large 
at the beginning of the Phase 2 program. 80 FR 40251. For the final 
rule, the agencies assessed the level of credits that the tractor 
manufacturers are accruing. As discussed above in Section III.D, the 
agencies adjusted the 2021 MY standards to reflect the accumulation of 
credits.
(2) Off-Cycle Technology Credits
    In Phase 1, the agencies adopted an emissions and fuel consumption 
credit generating opportunity that applied to innovative technologies 
that reduce fuel consumption and CO2 emissions. These 
technologies were required to not be in common use with heavy-duty 
vehicles before the 2010MY and not reflected in the GEM simulation tool 
(i.e., the benefits are ``off-cycle''). See 76 FR 57253. The agencies 
proposed to essentially continue this program in Phase 2. However, we 
are calling the

[[Page 73639]]

program an off-cycle credit program rather than an innovative 
technology program (although there is little, if any, difference in 
practice). In other words, beginning in 2021 MY all technologies that 
are not accounted for in the GEM test procedure (including powertrain 
testing) could be considered off-cycle, including those technologies 
that may have been considered innovative technologies in Phase 1 of the 
program. The agencies proposed to maintain the requirement that, in 
order for a manufacturer to receive credits for Phase 2, the off-cycle 
technology would still need to meet the requirement that it was not in 
common use prior to MY 2010. However, the final provisions will not 
require manufacturers to make such a demonstration. Rather, the 
agencies will merely retain the authority to deny a request if we 
determine that a technology was in common use in 2010 and was thus part 
of the Phase 1 baseline (and thus also the Phase 2 baseline). For 
additional information on the treatment of off-cycle technologies see 
Section I.C.1.c. as well as the discussion of off-cycle credits in each 
of the Phase 2 standard chapters.
(3) Post Useful Life Modifications
    Under 40 CFR part 1037, it is generally prohibited for any person 
to remove or render inoperative any emission control device installed 
to comply with the requirements of part 1037. However, in 40 CFR 
1037.655 EPA clarifies that certain vehicle modifications are allowed 
after a vehicle reaches the end of its regulatory useful life. This 
section applies for all vehicles subject to 40 CFR part 1037 and will 
thus apply for trailers regulated in Phase 2. EPA proposed to continue 
this provision and requested comment on it. 80 FR 40252.
    This section states (as examples) that it is generally allowable to 
remove tractor roof fairings after the end of the vehicle's useful life 
if the vehicle will no longer be used primarily to pull box trailers, 
or to remove other fairings if the vehicle will no longer be used 
significantly on highways with vehicle speed of 55 miles per hour or 
higher. More generally, this section clarifies that owners may modify a 
vehicle for the purpose of reducing emissions, provided they have a 
reasonable technical basis for knowing that such modification will not 
increase emissions of any other pollutant. This essentially requires 
the owner to have information that will lead an engineer or other 
person familiar with engine and vehicle design and function to 
reasonably believe that the modifications will not increase emissions 
of any regulated pollutant. Thus, this provision does not provide a 
blanket allowance for modifications after the useful life.
    This section also makes clear that no person may ever disable a 
vehicle speed limiter prior to its expiration point, or remove 
aerodynamic fairings from tractors that are used primarily to pull box 
trailers on highways. It is also clear that this allowance does not 
apply with respect to engine modifications or recalibrations.
    This section does not apply with respect to modifications that 
occur within the useful life period, other than to note that many such 
modifications to the vehicle during the useful life and to the engine 
at any time are presumed to violate section 202(a)(3)(A) of the Act. 
EPA notes, however, that this is merely a presumption, and it does not 
prohibit modifications during the useful life where the owner clearly 
has a reasonable technical basis for knowing that the modifications 
would not cause the vehicle to exceed any applicable standard.
    The agencies did not receive comments opposing the proposed 
regulation, and is adopting it as proposed.
(4) Other Interim Provisions
    In HD Phase 1, EPA adopted provisions to delay the full onboard 
diagnostics (OBD) requirements for heavy-duty hybrid powertrains until 
the 2016 and 2017 model years (see 40 CFR 86.010-18(q)). In discussions 
with manufacturers during the development of Phase 2, the agencies have 
learned that meeting the on-board diagnostic requirements for criteria 
pollutant engine certification continues to be a potential impediment 
to adoption of hybrid systems. See Section XIII.A.1 for a discussion of 
regulatory changes to reduce the non-GHG certification burden for 
engines paired with hybrid powertrain systems.
    The Phase 1 advanced technology credits were adopted to promote the 
implementation of advanced technologies, such as hybrid powertrains, 
Rankine cycle engines, all-electric vehicles, and fuel cell vehicles 
(see 40 CFR 1037.150(p)). As the agencies stated in the Phase 1 final 
rule, the Phase 1 standards were not premised on the use of advanced 
technologies but we expected these advanced technologies to be an 
important part of the Phase 2 rulemaking (76 FR 57133, September 15, 
2011). The HD Phase 2 heavy-duty engine and tractor standards are 
premised on the use of Rankine-cycle engines; therefore, the agencies 
believe it is no longer appropriate to provide extra credit for this 
technology. While the agencies have not premised the HD Phase 2 tractor 
standards on hybrid powertrains, fuel cells, or electric vehicles, we 
also foresee some limited use of these technologies in 2021 and beyond. 
We proposed in Phase 2 to not provide advanced technology credits in 
Phase 2 for any technology, but received many comments supporting the 
need for such incentive. As described in Section I.C.1.b, the agencies 
are finalizing credit multipliers for plug-in battery electric hybrids, 
all-electric, and fuel cell vehicles.
(5) Phase 1 Flexibilities Not Adopted for Phase 2
    In Phase 1, the agencies adopted an early credit mechanism to 
create incentives for manufacturers to introduce more efficient engines 
and vehicles earlier than they otherwise would have planned to do (see 
40 CFR 1037.150(a)). The agencies did not propose to extend this 
flexibility to Phase 2 because the ABT program from Phase 1 will be 
available to manufacturers in 2020 model year and this will displace 
the need for early credits. However, the agencies are adopting 
provisions in the final Phase 2 rule that provide early credit 
opportunities for a limited set of technologies (see 40 CFR 
1037.150(y)(2); see also 40 CFR 1037.150(y)(1) and (3) providing early 
credit flexibilities to certain vocational vehicles).

IV. Trailers

    As mentioned in Section III, trailers pulled by Class 7 and 8 
tractors (together considered ``tractor-trailers'') account for 
approximately 60 percent of the heavy-duty sector's total 
CO2 emissions and fuel consumption. Because neither trailers 
nor the tractors that pull them are useful by themselves, it is the 
combination of the tractor and the trailer that forms the useful 
vehicle. Although trailers do not directly generate exhaust emissions 
or consume fuels (except for the refrigeration units on refrigerated 
trailers), their designs and operation nevertheless contribute 
substantially to the CO2 emissions and diesel fuel 
consumption of the tractors pulling them. See also Section I.E above.
    The agencies are finalizing standards for trailers specifically 
designed to be drawn by Class 7 and 8 tractors when coupled to the 
tractor's fifth wheel. Although many other vehicles are known 
commercially as trailers, this trailer program does not apply to those 
that are pulled by vehicles other than tractors, and those that are 
coupled to vehicles exclusively by pintle hooks or hitches instead of a 
fifth wheel. These

[[Page 73640]]

standards are expressed in terms of CO2 emissions and fuel 
consumption, and as described in more detail in Section IV.C.(2), apply 
to specific trailer subcategories. In general, the final standards are 
based on the same technology as the proposed standards--primarily 
better tires (including tire pressure management) for all regulated 
trailers and aerodynamic improvements for box vans (dry and 
refrigerated). Most of the changes from the proposal are intended to 
simplify and clarify the implementation of these standards. See Section 
IV.B. for an overview of the final program, and the rest of this 
Section IV for more detailed discussions.
    This rulemaking establishes the first EPA regulations covering 
trailer manufacturers for CO2 emissions (or any other 
emissions), and the first fuel consumption regulations by NHTSA for 
these manufacturers. The agencies have designed this program to be a 
unified national program, so that when a trailer model complies with 
EPA's standards it will also comply with NHTSA's standards, and vice 
versa.

A. The Trailer Industry

(1) Industry Characterization
    The trailer industry encompasses a wide variety of trailer 
applications and designs. Among these are box vans (dry and 
refrigerated vans of various sizes) and ``non-box'' trailers, including 
platform (e.g., lowboys, flatbeds), tanks, container chassis, bulk, 
dump, grain, and many specialized types of trailers, such as car 
carriers, pole trailers, and logging trailers. Most trailers are 
designed for predominant use on paved streets, roads, and highways. A 
relatively small number of trailers are designed with unique 
capabilities and features for dedicated use in off-road applications.
    The trailer manufacturing industry is very competitive, and 
manufacturers are highly responsive to their customers' diverse 
demands. The wide range of trailer designs and features reflects the 
broad variety of customer needs, chief among them typically being the 
ability to maximize the amount of freight the trailer can transport. 
Other design goals reflect the numerous, more specialized customer 
needs.
    Box vans (i.e., dry and refrigerated) are the most common type of 
trailer and are made in many different lengths, generally ranging from 
28 feet to 53 feet. While all have a rectangular shape, they can vary 
widely in basic construction design (internal volume and weight), 
materials (steel, fiberglass composites, aluminum, and wood) and the 
number and configuration of axles (usually two axles closely spaced, 
but number and spacing of axles can be greater). Box van designs may 
also include additional features, such as one or more side doors, out-
swinging or roll-up rear doors, side or rear lift gates, and numerous 
types of undercarriage accessories (such as access ramps, dolly 
storage, spare tire storage, or mechanical lifts).
    Non-box trailers are often uniquely designed to transport a 
specific type of freight. Platform trailers carry cargo that may not be 
easily contained within or loaded into/unloaded from a box van, such as 
large, non-uniform equipment or machine components. Tank trailers are 
often sealed or pressurized enclosures designed to carry liquids, gases 
or bulk, dry solids and semi-solids. There are also a number of other 
specialized trailers such as grain, dump, livestock trailers, or 
logging.
    Chapter 1 of the RIA includes a more thorough characterization of 
the trailer industry. The agencies have considered the variety of 
trailer designs and applications in developing the CO2 
emissions and fuel consumption standards for trailers. As is described 
later in this Section IV, the agencies have excluded most types of 
specialized trailers from the Phase 2 regulations.
(2) Context for the Trailer Provisions
(a) Summary of Trailer Consideration in Phase 1
    In the Phase 1 program, the agencies did not regulate trailers, but 
discussed how we might do so in the future (see 76 FR 57362). In 
proposing the Phase 1 program, the agencies solicited general comments 
on controlling CO2 emissions and fuel consumption through 
future trailer regulations (see 75 FR 74345-74351). The agencies 
considered those comments in developing today's rules.
(b) SmartWay Program
    For several years, EPA's voluntary SmartWay Transport Partnership 
program has been encouraging businesses to take actions that reduce 
fuel consumption and CO2 emissions while cutting costs. The 
SmartWay program works with the shipping, logistics, and carrier 
communities to identify cleaner strategies and technologies for moving 
goods across their transportation supply chains. It is a voluntary, 
market-based program that provides carbon footprint and other air 
emissions performance information to partners who submit annual partner 
reports. SmartWay Partners commit to assessing, tracking, and improving 
environmental performance over time, by adopting fuel-saving practices 
and technologies. SmartWay also provides technical assistance, provides 
recognition incentives and encourages the use of best practices that 
enable companies to readily incorporate fuel and emission reduction 
strategies into their freight supply chains.
    Annually, SmartWay trucking fleet partners report type and amount 
of fuel consumption, tons of goods moved, type and model year of 
equipment used, miles driven, speed profiles and other data. Using EPA 
MOVES model emission factors and other EPA resources, SmartWay's 
assessment and tracking tools convert this information to an objective 
ranking of a company's environmental efficiency, enabling each 
participating company to benchmark performance relative to its 
competitors. Logistics companies, multimodal firms and shippers use 
this information to calculate their corporate emissions from goods 
movement, which can be included in annual carbon reporting protocols 
and sustainability reports.
    EPA's SmartWay program has accelerated the availability and market 
penetration of advanced, fuel efficient technologies and operational 
practices. In conjunction with the SmartWay Partnership Program, EPA 
established a testing, verification, and designation program, the 
SmartWay Technology Program, to help freight companies identify the 
equipment, technologies, and strategies that save fuel and lower 
emissions. SmartWay verifies the performance of aerodynamic equipment, 
low rolling resistance tires and other technologies and maintains lists 
of verified technologies on its Web site. Trailer aerodynamic 
technologies are grouped in performance bins that represent one 
percent, four percent, five percent or nine percent fuel savings 
relative to a typical long-haul tractor-trailer at 65-mph cruise 
conditions. As a shorthand description and to encourage saving fuel 
with multiple available technologies, EPA established criteria to 
describe tractors and trailers as SmartWay designated if they are 
equipped with specific technologies. Historically, a 53-foot dry van 
trailer equipped with verified aerodynamic devices totaling at least 
five percent fuel savings, and SmartWay verified tires, qualifies as a 
``SmartWay Designated Trailer.'' In 2014, EPA expanded the program to 
include the aerodynamic bin for nine percent or more fuel savings and 
these trailers when also equipped with verified tires qualify as 
``SmartWay Designated Elite Trailer.'' The 2014 updates also expanded 
the use of aerodynamic technologies and SmartWay-designated trailer 
eligibility to include 53-foot refrigerated van

[[Page 73641]]

trailers in addition to 53-foot dry van trailers.
    The SmartWay Technology Program continues to improve the industry 
understanding of technologies, test methods and quality of data fleet 
stakeholders need to achieve fuel savings and environmental goals. EPA 
bases its SmartWay verification protocols on common industry test 
methods with additional criteria to achieve performance objectives and 
cost effective industry acceptance. Historically, SmartWay's 
aerodynamic equipment verification protocol was based on the TMC type 
II and SAE J1321 test procedures, which measures fuel consumption as 
test vehicles drive laps around a test track. Under SmartWay's 2014 
updates, EPA expanded the aerodynamic technology verification program 
to allow additional testing options. The updates included a new, more 
stringent 2014 track test protocol based on industry updates to the TMC 
RP 1102 (2014) and SAE's 2012 update to its SAE J1321 test method \326\ 
as well as protocols for wind tunnel and coastdown methods. The 
SmartWay program is also reviewing computational fluid dynamics (CFD) 
approaches for verification. These new protocols are based on 
stakeholder input, the latest industry standards (i.e., 2012 versions 
of the SAE fuel consumption and wind tunnel test \327\ methods and 2013 
CFD guidance \328\), EPA's own testing and research, and lessons 
learned from years of communications with manufacturers, testing 
organizations and trucking companies. Wind tunnel, coastdown, and CFD 
testing produce values for aerodynamic drag improvements in terms of 
coefficient of drag (CD), which is then related to projected 
fuel savings using a mathematical curve.\329\
---------------------------------------------------------------------------

    \326\ SAE International, Fuel Consumption Test Procedure--Type 
II. SAE Standard J1321. Revised 2012-02-06. Available at: http://standards.sae.org/j1321_201202/.
    \327\ SAE International. Wind Tunnel Test Procedure for Trucks 
and Buses. SAE Standard J1252. Revised 2012-07-16. Available at: 
http://standards.sae.org/j1252_201207/.
    \328\ SAE International, Guidelines for Aerodynamic Assessment 
of Medium and Heavy Commercial Ground Vehicles Using Computational 
Fluid Dynamics. SAE Standard J2966. Issued 2013-09-17. Available at: 
http://standards.sae.org/j2966_201309/.
    \329\ McCallen, R., et al. Progress in Reducing Aerodynamic Drag 
for Higher Efficiency of Heavy Duty Trucks (Class 7-8). SAE 
Technical Paper. 1999-01-2238.
---------------------------------------------------------------------------

    The SmartWay Technology Program verifies tires based on test data 
submitted by tire manufacturers demonstrating the coefficient of 
rolling resistance (CRR) of their tires using either the SAE 
J1269 or ISO 28580 test methods. These verified tires have rolling 
resistance targets for each axle position on the tractor and trailer. 
SmartWay-verified trailer tires achieve a CRR of 5.1 kg/
metric ton or less on the ISO28580 test method. Compared to popular 
tires used in 2007, an operator who replaces the trailer tires with 
SmartWay-verified tires can expect fuel consumption savings of one 
percent or more at a 65-mph cruise. Operators who apply SmartWay-
verified tires on both the trailer and tractor can achieve three 
percent fuel consumption savings at 65-mph. As most van trailers and 
many other trailer types are manufactured with SmartWay verified tires, 
fleets have confidence in maintaining their fuel performance thru the 
use of and flexibility to choose other SmartWay verified tires.
    Over the last decade, the trucking industry has achieved 
measureable fuel consumption benefits by adding aerodynamic features 
and low rolling resistance tires to their trailers. To date, SmartWay 
has verified over 70 aerodynamic technologies, including ten packages 
from five manufacturers that have received the Elite performance level. 
The SmartWay Transport Partnership program has worked with over 3,000 
partners, the majority of which are trucking fleets, and broadly 
throughout the supply-chain industry, since 2004. These relationships, 
combined with the Technology Program's extensive involvement testing 
and technology development has provided EPA with significant experience 
in freight fuel efficiency. Furthermore, the more than 10-year duration 
of the voluntary SmartWay Transport Partnership has resulted in 
significant fleet and manufacturer experience with innovating and 
deploying technologies that reduce CO2 emissions and fuel 
consumption.
(c) California Tractor-Trailer Greenhouse Gas Regulation
    The state of California passed the Global Warming Solutions Act of 
2006 (Assembly Bill 32, or AB32), enacting the state's 2020 greenhouse 
gas emissions reduction goal into law. Pursuant to this Act, the 
California Air Resource Board (CARB) was required to begin developing 
early actions to reduce GHG emissions. As a part of a larger effort to 
comply with AB32, the California Air Resource Board issued a regulation 
entitled ``Heavy-Duty Greenhouse Gas Emission Reduction Regulation'' in 
December 2008.
    This regulation reduces GHG emissions by requiring improvement in 
the efficiency of heavy-duty tractors and 53 feet or longer dry and 
refrigerated box trailers that operate in California.\330\ The program 
is being phased in between 2010 and 2020. Small fleets have been 
allowed special compliance opportunities to phase in the retrofits of 
their existing trailer fleets through 2017. The regulation requires 
affected trailer fleet owners to either use SmartWay-verified 
aerodynamic technologies and SmartWay-verified tires or retread tires. 
The efficiency improvements are achieved through the use of aerodynamic 
equipment and low rolling resistance tires on both the tractor and 
trailer. EPA has granted a waiver for this California program.\331\
---------------------------------------------------------------------------

    \330\ In December 2013, ARB adopted regulations that establish 
its own parallel Phase 1 program with standards consistent with the 
EPA Phase 1 tractor standards. On December 5, 2014 California's 
Office of Administrative Law approved ARB's adoption of the Phase 1 
standards, with an effective date of December 5, 2014.
    \331\ See EPA's waiver of CARB's heavy-duty tractor-trailer 
greenhouse gas regulation applicable to new 2011 through 2013 model 
year Class 8 tractors equipped with integrated sleeper berths 
(sleeper-cab tractors) and 2011 and subsequent model year dry-can 
and refrigerated-van trailers that are pulled by such tractors on 
California highways at 79 FR 46256 (August 7, 2014).
---------------------------------------------------------------------------

(d) NHTSA Safety-Related Regulations for Trailers and Tires
    NHTSA regulates new trailer safety through regulations. Table IV-1 
lists the current regulations in place related to trailers. Trailer 
manufacturers continue to be required to meet current safety 
regulations for the trailers they produce. FMVSS Nos. 223 and 224 \332\ 
require installation of rear guard protection on trailers. The 
definition of rear extremity of the trailer in 223 limits installation 
of rear fairings to a specified zone behind the trailer.
---------------------------------------------------------------------------

    \332\ 49 CFR 571.223 and 571.224.

 Table IV-1--Current NHTSA Statutes and Regulations Related to Trailers
------------------------------------------------------------------------
                 Reference                              Title
------------------------------------------------------------------------
49 CFR part 565...........................  Vehicle Identification
                                             Number (VIN) Requirements.
49 CFR part 566...........................  Manufacturer Identification.
49 CFR part 567...........................  Certification.
49 CFR part 568...........................  Vehicles Manufactured in Two
                                             or More Stages.
49 CFR part 569...........................  Regrooved Tires.
49 CFR part 571...........................  Federal Motor Vehicle Safety
                                             Standards.
49 CFR part 573...........................  Defect and Noncompliance
                                             Responsibility and Reports.
49 CFR part 574...........................  Tire Identification and
                                             Recordkeeping.
49 CFR part 575...........................  Consumer Information.
49 CFR part 576...........................  Record Retention.
------------------------------------------------------------------------


[[Page 73642]]

    NHTSA recognizes that regulatory and market factors that result in 
changes in trailer weight can potentially have safety ramifications, 
both positive and negative. NHTSA believes that the appropriate 
perspective is to evaluate the regulation and market factors in their 
entirety. One such factor is that incentives in the Phase 2 regulation 
could result in an average decrease in trailer weight. Since removing 
weight from trailers allows more cargo to be carried, fewer trips are 
needed to move the same amount of cargo, and fewer crashes--including 
fatal crashes--could occur. Fleets and other customers have a natural 
incentive to request lighter-weight trailers. From the trailer owners' 
perspective, reducing trailer weight not only allows them to increase 
cargo when they are near capacity, but also reduces fuel consumption 
whether the trailer is fully loaded or not. In pre-proposal meetings 
with trailer manufacturers, companies said that customers are 
requesting lighter-weight components when possible and manufacturers 
are installing them.
    To further incentivize a shift to lighter weight materials, the 
Phase 2 program provides two compliance mechanisms, both of which are 
discussed later in this Preamble (Section IV.D.(1)(d) and Section 
IV.E.(5)(d), respectively). The first is a list of weight reductions 
from which manufacturers can select. The list identifies specific 
lighter-weight components, such as side posts, roof bows, and flooring. 
Manufacturers using these lighter-weight components achieve fuel 
consumption and GHG reductions that count toward their compliance 
calculations. The NPRM identified twelve components, ranging from 
lighter-weight landing gear (which receives credit for 50 pounds of 
weight reduction) to aluminum upper coupler assemblies (which receive 
credit for 430 pounds). See proposed section 1037.515 at 80 FR 40627. 
In addition, for a lighter-weight component or technology that is not 
on the list of specific components, the program provides for 
manufacturers to use the ``off-cycle'' process to recognize the weight 
reduction (Section IV.E.(5)(d)). Through these mechanisms, the program 
provides significant flexibility and incentives for trailer light-
weighting.
    NHTSA also recognizes that the aerodynamic devices that we expect 
may be adopted to meet the Phase 2 trailer standards inherently add 
weight to trailers. In comments on the NPRM, TTMA stated that they 
believe that this weight increase will result in added trips and 
increased numbers of fatal crashes. By its analysis, this additional 
weight--which TTMA estimates to be 250 pounds per trailer, will cause 
some trucks to exceed the trailer weight limits, necessitating 
additional truck trips to transport freight that could not be moved by 
the ``weighed-out'' trucks. By TTMA's analysis, these added trips would 
cause an additional 184 million truck miles per year and would result 
in 246 crashes and 7 extra fatal crashes, using an assumed crash rate 
of 134 collisions per 100 million VMT and a 3 percent fatality rate per 
crash. The agencies evaluated TTMA's estimate of additional fatalities 
and disagree with some of the assumptions made in the analysis. For 
example, the fatality rate used was developed in a study conducted for 
Idaho and is higher than the national average. According to FMCSA's 
2014 annual report for ``Large Truck and Bus Crash Facts'' indicates 
there are less than 1.67 fatalities per 100 million vehicle miles 
traveled (VMT) by combination trucks in the U.S. for 2014. When 
multiplied by an estimated 184 million additional truck miles due to 
weighed-out trucks, the result is an increase of about 3 fatalities, or 
2.7 fatal crashes.
    Overall, the potential positive safety implications of weight 
reduction efforts could partially or fully offset safety concerns from 
added weight of aerodynamic devices. In fact, for this reason, we 
believe that the Phase 2 trailer program could produce a net safety 
benefit in the long run due to the potentially greater amount of cargo 
that could be carried on each truck as a result of trailer weight 
reduction.
(e) Additional DOT Regulations Related to Trailers
    In addition to NHTSA's regulations, DOT's Federal Highway 
Administration (FHWA) regulates the weight and dimensions of motor 
vehicles on the National Network.\333\ FHWA's regulations limit states 
from setting truck size and weight limits beyond certain ranges for 
vehicles used on the National Network. Specifically, vehicle weight and 
truck tractor-semitrailer length and width are limited by FHWA.\334\ 
EPA and NHTSA do not anticipate any conflicts between FHWA's 
regulations and those established in this rulemaking.
---------------------------------------------------------------------------

    \333\ 23 CFR 658.9.
    \334\ 23 CFR part 658.
---------------------------------------------------------------------------

    Utility Trailer Manufacturing Co. (Utility) commented that reducing 
existing restrictions on trailer size and weight could help encourage 
the transition to new technologies and trailer designs. However, these 
size and weight restrictions are under the jurisdiction of FHWA, and 
are largely controlled by the weight limits established by Congress in 
1956 and 1974, the size limits established in the Surface 
Transportation Assistance Act of 1982, and the size and weight limits 
established in the Intermodal Surface Transportation Efficiency Act of 
1991. Changes to these restrictions would require a broader process 
involving Congress and federal and state agencies, and is beyond the 
scope of the Phase 2 trailer program.
    Wabash National Corporation (Wabash) stated that the agencies 
should seek to ensure that today's action harmonizes with safety 
regulations applicable to trailers. Specifically, Wabash highlighted 
NHTSA's work on rear impact guard standards and ongoing examination of 
side impact guards. Wabash stated new or revised requirements for 
impact guards could increase trailer weight. The agencies have analyzed 
the issues in the present rulemaking while fully considering NHTSA's 
safety regulations and rulemakings pertaining to trailers. The subject 
of a possible side guard requirement is in a research stage. As 
discussed in a July 2015 document, NHTSA is in the process of 
evaluating issues relating to side guards and will issue a decision on 
them at a later date.\335\ In December 2015, NHTSA issued a notice of 
proposed rulemaking proposing to adopt requirements of Transport 
Canada's standard for underride guards.\336\ NHTSA is currently 
assessing next steps on that proposal, and includes as part of its 
analysis consideration of impacts of any decisions on the fuel 
efficiency of the vehicles. With respect to Wabash's comment regarding 
the additional weight from aerodynamic devices, as discussed in the 
previous subsection, the agencies believe potential compliance paths 
incorporating lightweighting could offset the additional weight of 
aerodynamic devices in whole or in part.
---------------------------------------------------------------------------

    \335\ 80 FR 43663 (footnote 3) (July 23, 2015).
    \336\ 80 FR 78417 (December 16, 2015).
---------------------------------------------------------------------------

B. Overview of the Phase 2 Trailer Program and Key Changes From the 
Proposal

    The HD Phase 2 program represents the first time CO2 
emission and fuel consumption standards have been established for 
manufacturers of new trailers. As was proposed (80 FR 40257), the final 
standards will phase in gradually, beginning in MY 2018. New regulated 
trailers built on or after January 1, 2018 need to be certified to

[[Page 73643]]

the new CO2 emissions standards.\337\ NHTSA fuel consumption 
standards are voluntary until MY 2021.
---------------------------------------------------------------------------

    \337\ For an explanation of how EPA defines ``model year'' for 
purposes of the trailer program, see Section IV.E.(1)(a).
---------------------------------------------------------------------------

    EPA and NHTSA proposed a trailer program, using appropriate aspects 
of the Phase 1 tractor program as a guide, including optional averaging 
provisions (i.e. optional averaging across a manufacturer's trailer 
fleet) as a flexibility for trailer manufacturers to meet the proposed 
standards. The comments from the trailer industry were nearly unanimous 
in opposing averaging. Commenters cited the highly competitive nature 
of the industry, combined with a wide range of product diversity among 
companies. Commenters believe that these two factors could result in a 
program that unfairly benefits the few larger companies with diverse 
offerings and would be impossible to implement for the many companies 
with limited product diversity. Additionally, compared to other 
industry sectors, trailer manufacturers noted that they often have 
little control over what kinds of trailer models their customers demand 
and thus limited ability to manage the mix and volume of different 
products. Specifically, Wabash and Utility stated that the dynamic and 
customer-driven nature of the industry, with many customer-specific 
requirements for each trailer order, makes it impossible for a 
manufacturer to predict what products they will produce in a given 
year. Utility stated that an averaging program will put manufacturers 
in the position of having to decide which customers receive trailers 
with aerodynamic devices and which receive trailers without devices. 
Utility added that averaging may force manufacturers to absorb the cost 
of aerodynamic devices, or it could cause customers to go to another 
manufacturer with sufficient credits to fill an order without using 
aerodynamic devices. Truck Trailer Manufacturers Association (TTMA) 
also submitted comments asking the agencies not to adopt averaging 
provisions. In contrast, Great Dane stated that averaging is an option 
manufacturers may need and recommended its inclusion in the final rule. 
The International Council on Clean Transportation (ICCT) said that they 
generally favor averaging since it gives manufacturers maximum 
flexibility in meeting standards while allowing for the technology 
deployment path that best matches a company's business strategy.
    In order to balance the advantage of an averaging program in 
allowing for introduction of the most reasonably stringent standards 
for trailers with the concerns articulated by manufacturers, the final 
program accordingly limits the option for trailer manufacturers to 
apply averaging exclusively to MYs 2027 and later for full-aero box 
vans only. We believe this delay provides box van manufacturers 
sufficient time to develop, evaluate and market new technologies and to 
become familiar with the compliance process and possible benefits of 
averaging. This will also allow customers to become more familiar with 
the technologies and to recognize their benefits. See Section 
IV.E.(5)(b) for more details on the trailer averaging program. In the 
earlier years of the program, when the program does not provide for 
averaging, the program does provide each manufacturer with a limited 
``allowance'' of trailers that do not need to meet the standards. See 
Section IV.E.(5)(a) below.
    The agencies proposed standards for dry and refrigerated box vans 
that were performance-based, and that were predicated on a high 
adoption of aerodynamic technologies, lower rolling resistance (LRR) 
tires and automatic tire inflation systems (ATIS). We designed the 
compliance approach for these performance-based standards so that 
manufacturers would have a degree of choice among aerodynamic, tire, 
tire pressure, and weight-reduction technologies and could combine them 
as they wished to achieve the standards. See 80 FR 40257. This final 
program maintains this flexible approach, adding provisions that 
include options for using tire pressure monitoring systems (TPMS) and 
innovative weight-reduction technologies as part of manufacturer 
compliance strategies. Section IV.E.(2) below discusses the trailer 
compliance provisions.
    We proposed ``partial-aero'' criteria for box vans with work-
performing equipment that impeded use of aerodynamic technologies and 
we proposed that those ``partial-aero'' box vans would not have to 
adopt the most stringent standards in MY 2027; instead, they would 
maintain the MY 2024 standards. We also proposed design-based tire 
standards for non-box trailers that required adoption of LRR tires and 
ATIS. Finally, in recognition that some specialized box van designs are 
not very compatible with the aerodynamic technologies, the agencies 
established ``non-aero'' criteria for box vans. Box vans meeting the 
``non-aero'' criteria will be subject to the same requirements as the 
non-box trailers. 80 FR 40259.
    The proposed program was designed to include nearly all trailer 
types, with a limited number of exemptions or exclusions that we 
believed indicated off-road, heavy-haul or non-freight transporting 
operation. TTMA and the American Trucking Associations (ATA) provided 
comments suggesting that additional trailer types should be excluded 
from the program based on these trailers' typical operational 
characteristics. The agencies considered the suggestions of these 
commenters and of several individual trailer manufacturers, and we 
recognize that many trailers in the proposed non-box subcategory have 
unique physical characteristics for specialized operations that may 
make use of lower rolling resistance (LRR) tires and/or tire pressure 
systems difficult or infeasible. Instead of focusing on trailer 
characteristics that indicated off-highway or specialty use, the 
agencies have identified three specific types of non-box trailers that 
represent the majority of non-box trailers that are designed for and 
mostly used in on-road applications: Tank trailers, flatbed trailers, 
and container chassis. Because of their predominant on-road usage, the 
tire technologies adopted in this trailer program will be consistently 
effective for these non-box trailer types. Consequently, the final 
program as it applies to non-box trailers is limited to tanks, 
flatbeds, and container chassis. All other non-box trailers, about half 
of the non-box trailers produced, are excluded from the Phase 2 trailer 
program, with no regulatory requirements. See Section IV.C.(1) for the 
regulatory definitions of the trailers included in this program.
    Wabash commented that partial-aero vans should be exempt in MY 2021 
rather than MY 2027 as proposed, citing the need for multiple devices 
to meet the later standards. The agencies reconsidered the proposed 
partial-aero standards in light of this comment and recognize that it 
would likely be difficult for most manufacturers to meet the proposed 
MY 2024 standards without the use of multiple devices, and yet partial-
aero trailers, by definition, are restricted from using multiple 
devices. For these reasons, the agencies redesigned the partial-aero 
standards such that trailers with qualifying work-performing equipment 
can meet standards that would be achievable with the use of a single 
aerodynamic device throughout the program, similar to the MY 2018 
standards. The partial-aero standards do, however, increase in 
stringency slightly in MY 2021 to reflect

[[Page 73644]]

the broader use of improved lower rolling resistance tires.
    The agencies also considered comments from manufacturers that were 
concerned about the cost and, availability of ATIS for the trailer 
industry. Wabash, Owner Operator Independent Drivers Association 
(OOIDA), the Rubber Manufacturers Association (RMA), American Trucking 
Associations (ATA), and Bendix asked that TPMS be allowed for trailer 
tire compliance in addition to ATIS. OOIDA said that operators prefer 
less expensive and easier to operate TPMS to ATIS. Wabash expressed 
concern that ATIS suppliers would not be able to meet demand should 
ATIS be required as a compliance mechanism for all trailers, especially 
in the early years of the program. Great Dane stated that their 
customers are not seeing consistent benefit of ATIS. ATA commented that 
trailer manufacturers should be allowed to use TPMS for compliance 
because they are increasingly effective, and some trailers used in 
heavy-haul applications would need an additional ATIS air compressor, 
which adds cost and weight that can be avoided by the use of TPMS. The 
California Air Resources Board supported the agencies' proposal to 
allow only ATIS for compliance since TPMS require action on the part of 
the driver to re-inflate affected tires and thus the benefit of the 
systems is dependent on driver behavior.
    The agencies agree that TPMS generally promote proper tire 
inflation and that including these lower-cost systems as a compliance 
option will increase acceptance of the technologies. The final trailer 
program provides for manufacturers to install either TPMS or ATIS as a 
part of compliance. For full- and partial-aero trailers, the standards 
are performance standards, and the GEM-based compliance equation 
(described below) provides ATIS a slightly greater credit than it does 
for TPMS, to account for the greater uncertainty about TPM system 
effectiveness due to the inherent user-interaction required with 
systems that simply monitor tire pressure. These performance standards 
are based on the use of ATIS and the numerical values of these 
standards reflect the 0.2 percent increase in stringency. See Section 
IV.D.(1)(c) for additional information.
    For non-aero box vans and non-box trailers, the standards are 
design standards, met directly by installation of specified 
technologies, not by using the compliance equation. As long as a 
manufacturer of these trailers installs either a TPMS or an ATIS (as 
well as lower rolling resistance tires meeting the specified 
threshold), the trailer will comply, and either technology applies 
equally. We project that most design-based tire standards will be met 
with the less expensive TPMS, but trailers with ATIS will also comply. 
The effectiveness values adopted for ATI and TPMS in the trailer 
program are consistent with those in the tractor and vocational vehicle 
programs.
    The agencies generated the proposed standards with use of EPA's 
Greenhouse gas Emissions Model (GEM) vehicle simulation tool, but for 
compliance we created a GEM-based equation that trailer manufacturers 
would use for compliance. See Section IV.E.(2)(a). We made several 
improvements to GEM based on public comment, and these improvements 
impacted the results of the model. We have re-created a compliance 
equation for trailers based on the updated model and are adopting the 
new equation as the means for trailer manufacturers to certify their 
trailers in Phase 2.
    The agencies also proposed an aerodynamic device testing compliance 
path that would allow device manufacturers to submit performance test 
data directly to EPA for pre-approval. 80 FR 40280. We designed this 
alternative to reduce the test burden of trailer manufacturers by 
allowing them to install devices with pre-approved data and to 
eliminate the need to perform their own testing of the devices. Based 
on public comment, the agencies are adopting the aerodynamic device 
testing alternative in the final trailer program and are updating 
several of the provisions related to submission and verification of 
test data on those devices. See Section IV.E.(3)(b)(v).
    The agencies considered five alternative programs in the proposal 
and extensively evaluated what were termed Alternative 3 and 
Alternative 4 in our feasibility analysis. 80 FR 40273. The final 
stringency of both alternatives was identical and each included three-
year stages of increasing stringency. However, Alternative 4 
represented an accelerated timeline that reached its final stringency 
in MY 2024. Alternative 3 included an additional three years to meet 
its final stringency in MY 2027. Alternative 5 was proposed in four 
stages, but would have a required much greater application rate of the 
most advanced aerodynamic devices, including aerodynamic technologies 
on non-box trailers. The agencies believed this alternative was 
infeasible for this newly-regulated industry and did not extensively 
evaluate it.
    Public comment from the trailer industry unanimously opposed the 
accelerated timeline of the proposed Alternative 4. TTMA recommended 
that the agencies adopt no mandatory requirements, and instead rely on 
a voluntary program for trailers. OOIDA supported standards less 
stringent than either Alternatives 3 or 4. Great Dane said that 
adoption of standards more stringent than Alternative 3 would 
considerably increase the probability of negative effects on 
stakeholders. Wabash questioned whether, under the accelerated timeline 
of Alternative 4, current technologies could be produced for all 
applications for which they would be needed, and with sufficient 
reliability. The International Food Service Delivery Association, the 
Truck Trade Association, and Schneider also opposed Alternative 4 for 
similar reasons. STEMCO, California Air Resources Board (CARB), ICCT, 
and American Council for an Energy-Efficient Economy (ACEEE) supported 
Alternative 4. The Environmental Defense Fund (EDF) supported 
Alterative 5, but with an accelerated schedule, saying technologies 
will be available to meet the Alternative 5 standards by 2024.
    The final standards adopted for the Phase 2 trailer program have 
the same four-stage implementation schedule as the proposed Alternative 
3, with standards phasing in for MYs 2018, 2021, 2024, and 2027 (NHTSA 
standards apply beginning in MY 2021). We received comments regarding 
adjustments to technology adoption rates in our baseline reference 
cases which the agencies found to be persuasive, and the resulting 
adjustments are described in Section IV.D.(2)(c). Additionally, the 
technology effectiveness values and projected adoption rates for each 
of the four stages of the program were updated in response to comments, 
to reflect new test data, and to account for a program without 
averaging.

C. Phase 2 Trailer Standards

    These final rules establish, for the first time, a set of 
CO2 emission and fuel consumption standards for 
manufacturers of new trailers that phase in over a period of nine years 
and continue to reduce CO2 emissions and fuel consumption in 
the years to follow. These standards are expressed as overall 
CO2 emissions and fuel consumption performance standards, 
considering the trailer as an integral part of the tractor-trailer 
vehicle.
    The agencies believe that the trailer standards finalized here will 
implement our respective statutory obligations. That is, we believe 
that this set of standards represents the maximum feasible alternative 
within the meaning of section 32902(k) of EISA, and are

[[Page 73645]]

appropriate under EPA's CAA authority (sections 202(a)(1) and (2)).
    These standards have the same implementation schedule as the 
proposed Alternative 3, with standards phasing in for MYs 2018, 2021, 
2024, and 2027. In our consideration of the full range of comments, the 
agencies have adjusted elements of the proposed Alternative 3 in ways 
that address some of these comments, as discussed in Section 0 below. 
As discussed in Section IV.E.(5)(b), the option to apply averaging to 
meet these standards will be available starting with MY 2027, but will 
not be available in earlier model years.
    The agencies did not propose and are not establishing standards for 
CO2 emissions and fuel consumption from the transport 
refrigeration units (TRUs) used on refrigerated box trailers. Also, EPA 
is not establishing standards for hydrofluorocarbon (HFC) emissions 
from TRUs. See Section IV.C.(3) below.
(1) Trailer Designs Covered by the Trailer Program
    As described previously, the trailer industry produces many 
different trailer designs for many different applications. The agencies 
are introducing standards for a majority of these trailers that phase 
in from MY 2018 through MY 2027; the NHTSA fuel consumption standards 
are voluntary until MY 2021. The regulatory definitions of the trailers 
covered by this program are summarized below and are found in 40 CFR 
1037.801 and 49 CFR 571.3.
(a) Box Vans
    Box vans are trailers with enclosed cargo space that is permanently 
attached to the chassis, with fixed sides, nose and roof. Trailers with 
sides or roofs consisting of curtains or other removable panels are not 
considered box vans in this program. Box vans with self-contained HVAC 
systems are considered ``refrigerated vans.'' This definition includes 
systems that provide cooling, heating or both. Box vans without HVAC 
systems are considered ``dry vans.''
    This rulemaking establishes separate standards for box vans based 
on length. Box vans of length greater than 50 feet are considered 
``long box vans.'' \338\ All vans 50 feet and shorter are considered 
``short box vans.'' The agencies requested comment on the proposed 50-
foot demarcation between ``long'' and ``short'' box vans (80 FR 40258). 
CARB and the Union of Concerned Scientists (UCS) commented on this 
issue, requesting that the demarcation be changed to 47 feet, such that 
48-foot vans would be covered under the long box subcategory. CARB 
suggested that the performance of aerodynamic technologies such as 
skirts and boat tails on a 48-foot van would be more similar to the 
performance of the same technologies on a 53-foot van than on the 28-
foot van used to evaluate short box performance. CARB also stated that 
48-foot trailers are not pulled in tandem and thus have the potential 
to adopt rear devices for additional reductions.
---------------------------------------------------------------------------

    \338\ Most long trailers are 53 feet in length; we are adopting 
a cut-point of 50 feet to avoid an unintended incentive for an OEM 
to slightly shorten a trailer design in order to avoid the new 
regulatory requirements.
---------------------------------------------------------------------------

    The agencies agree that 48-foot vans are aerodynamically similar to 
longer vans and that 28-foot trailers are often used in tandem, 
reducing the opportunity for rear aerodynamic features. However, the 
agencies believe that the use of 48-foot vans is more similar to that 
of shorter trailers than to that of the long-haul vans that make up 
most the long box subcategory. Trailer manufacturers have indicated 
that 48-foot vans are mostly used in short-haul operations (e.g., local 
food service delivery) and consequently they travel less frequently at 
speeds at which aerodynamic technologies can be most beneficial. Also, 
48-foot vans make up a relatively small fraction of long box vans.\339\ 
The agencies thus do not believe that standards predicated on the use 
of more effective aerodynamic technologies on 48-foot vans will provide 
a substantial enough additional reduction in CO2 emissions 
and fuel consumption to justify more stringent standards for those 
trailers. For these reasons, the agencies are maintaining the proposed 
50-foot demarcation between long and short box vans and are basing the 
standards for each van size category accordingly.
---------------------------------------------------------------------------

    \339\ Memorandum to Docket EPA-HQ-OAR-2014-0827: Evaluation of 
50-Foot Trailer Length Demarcation to Distinguish between Long and 
Short Box Vans. July 18, 2016.
---------------------------------------------------------------------------

    The trailer program identifies certain types of work-performing 
equipment manufacturers may install on box vans that may inhibit the 
use of aerodynamic technologies and thus impede the trailers' ability 
to meet standards predicated on adoption of aerodynamic technologies. 
For this program, we consider such trailer equipment to consist of a 
rear lift gate or rear hinged ramp and any of the following side 
features: A side lift gate, a side-mounted pull-out platform, steps for 
side-door access, a drop-deck design, or a belly box or boxes that 
occupy at least half the length of both sides of the trailer between 
the centerline of the landing gear and the leading edge of the front 
wheels. See 40 CFR 1037.107(a)(1) and 49 CFR 571.3.
    The agencies have also considered how ``roll-up'' or ``overhead'' 
rear trailer doors might inhibit the use of rear aerodynamic devices. 
TTMA, ATA, Great Dane, and Utility stated that roll-up doors are work-
performing devices that can inhibit rear aerodynamic technologies. 
However, the agencies are aware of several existing aerodynamic devices 
designed to be installed near the rear of a trailer that can function 
regardless of the type of rear door. Also, in their comments, STEMCO 
indicated that additional rear aerodynamic technologies would be less 
likely to enter the market if the trailer program were to include roll-
up doors on the list of work-performing devices above and the industry 
didn't demand an aerodynamic product to work with roll-up doors. The 
agencies recognize there may currently be limited availability of rear 
aerodynamic technologies for roll-up door trailers, yet we also 
understand that innovations and improvements continue for all trailer 
aerodynamic technologies. For this reason, the final trailer program 
includes an interim provision--through MY 2023--for box vans with roll-
up doors to qualify for non-aero and partial-aero standards (as defined 
immediately below), by treating such doors as work-performing devices 
equivalent to rear lift gates. For MY 2024 and later, roll-up doors 
will not qualify as a work-performing device in this way; however, we 
expect that manufacturers of trailers with roll-up doors will comply 
using combinations of new rear aerodynamic technologies, in conjunction 
with improved trailer side and gap-reducing technologies as 
appropriate. See 40 CFR 1037.150.
    As presented in Section IV.C.(2) below, the agencies are adopting 
separate standards for each of the same nine box van subcategories 
introduced in the proposal (80 FR 40256) and for the non-box category 
discussed below. Full-aero long box dry vans and full-aero long box 
refrigerated vans are those that are over 50 feet in length and that do 
not have any of the work-performing equipment discussed immediately 
above. Similarly, full-aero short box dry vans and full-aero short box 
refrigerated vans are 50 feet and shorter without any work-performing 
equipment. We expect these trailers to be capable of meeting the most 
stringent standards in the trailer program.
    Long box dry vans and long box refrigerated vans that have work-
performing equipment either on the underside or on the rear of the 
trailer that would limit a manufacturer's ability

[[Page 73646]]

to install aerodynamic technologies may be designated as partial-aero 
vans for their given subcategory. The partial-aero standards are based 
on adoption of tire technologies and a single aerodynamic device 
throughout the program. Long box dry and refrigerated vans that have 
work-performing equipment on the underside and rear of the trailer may 
be designated non-aero box vans. Non-aero box vans are a single 
subcategory that have design-based tire standards.
    For short vans, the standards are never predicated on the use of 
rear devices, since many 28-foot trailers are often pulled in tandem. 
However, we are not aware of any current legislative or regulatory 
initiatives that would allow tandem trailers longer than 33 feet in 
length, and therefore we believe that short vans of length 35 feet and 
longer are unlikely to be pulled in tandem in the timeframe of these 
rules. We are adopting separate criteria for partial- and non-aero 
designation for short vans based on a length threshold of 35 feet. If 
vans 35 feet or longer have work-performing equipment on the underside 
of the trailer, we expect manufacturers can install rear devices to 
meet the full-aero standards, but they have the option to designate 
these trailers as partial-aero dry or refrigerated short vans with 
reduced standards that can be met with tire technologies and a single 
aerodynamic device. If vans 35 feet and longer have work performing 
equipment on the underside and rear, manufacturers may designate them 
as non-aero box vans.
    Short vans that are less than 35 feet in length are more likely to 
be pulled in tandem, making most rear aerodynamic devices infeasible. 
Since gap reducers alone are not sufficiently effective to replace a 
skirt and the shortest trailers are not expected to install rear 
devices, both dry and refrigerated vans that are shorter than 35 feet 
with work-performing equipment on the underside of the trailer may be 
designated non-aero box vans that can comply with tire technologies 
only. In addition, refrigerated vans that are shorter than 35 feet 
cannot install gap reducers because of the TRU. Consequently, all 
refrigerated vans shorter than 35 feet, irrespective of work-performing 
equipment, can be designated partial-aero short refrigerated vans whose 
standards can be met with skirts and tire technologies. See 40 CFR 
1037.107(a)(1) and 49 CFR 571.3. Because the types of work-performing 
equipment identified here generally add significant cost and weight to 
a trailer, we believe that the reduced standards available for trailers 
using this equipment are unlikely to provide an incentive for 
manufacturers to install them simply as a way to avoid the full aero 
standards.
(b) Non-Box Trailers
    All trailers that do not meet the definition of box vans are 
considered non-box trailers in the trailer program. Several commenters 
requested a clearer distinction of the trailers that are included in 
the program. In response, the agencies are limiting the non-box trailer 
standards to three trailer types that have distinct physical 
characteristics and are most often driven on-highway: Tank trailers, 
flatbed trailers, and container chassis. Non-box trailers that do not 
meet the definitions below are excluded from the trailer program, as 
discussed in the following section.
    Tank trailers are defined for the trailer program as enclosed 
trailers designed to transport liquids or gases. For example, DOT 406, 
DOT 407, and DOT 412 tanks would fit this definition. These non-box 
trailers can be pressurized or designed for atmospheric pressure. Tanks 
that are infrequently used in transport and primarily function as 
storage vessels for liquids or gases (e.g., frac tanks) are not 
included in our definition of tank trailers and are excluded from the 
program.
    Flatbed trailers for purposes of the trailer program are platform 
trailers with a single, continuous load-bearing surface that runs from 
the rear of the trailer to at least the trailer's kingpin. Flatbed 
trailers are designed to accommodate side-loading cargo, and this 
definition includes trailers that use bulkheads, one or more walls, 
curtains, straps or other devices to restrain or protect cargo while 
underway. Note that drop deck and lowboy platform trailers are not 
considered continuous load-bearing surfaces.
    Finally, in the trailer program, container chassis are trailers 
designed to transport temporary containers. The standards apply to all 
lengths of container chassis, including expandable versions. The 
regulations do not apply to the containers being transported, unless 
they are permanently mounted on the chassis.
(c) Excluded Trailers
    As in the proposal (80 FR 40259), the final trailer program 
completely excludes certain trailer types. However, in response to 
comments and an improved understanding of the industry, the agencies 
have changed our approach to excluding some trailer types.
    In the proposal, we focused on excluding trailers based on 
characteristics that tended to indicate predominant operation in off-
highway applications. The American Trucking Associations (ATA) and the 
Truck Trailer Manufacturers Association (TTMA) provided comments 
suggesting that additional trailer types should be excluded from the 
program based on the trailers' typical operational characteristics, 
generally because of these trailers' limited on-highway operation. 
Also, Wabash requested that the program specify clearer criteria for 
excluding or exempting trailers.
    The agencies considered all of the suggestions of the commenters, 
and we now believe that a different approach to excluding some trailer 
types is more appropriate. We recognize that many trailer types in the 
proposed non-box subcategory have many unique physical characteristics 
and are designed for specialized operations and it would be difficult 
to create a comprehensive list of traits that indicated off-road use. 
This wide array of trailer types would have made the proposed approach 
difficult to implement for both trailer manufacturers and for the 
agencies, since the usage patterns of many specialty trailer types can 
vary greatly. Some of these uses, especially off-highway applications, 
may make use of the proposed tire technologies for compliance difficult 
or infeasible and may limit their effectiveness. Additionally, the 
agencies are aware that many manufacturers that build these specialty 
non-box trailers are small businesses (fewer than 1000 employees), and 
they would incur a disproportionately large financial burden compared 
to larger manufacturers if they were subject to the standards.
    For these reasons, instead of focusing our approach to excluding 
trailer types on trailer characteristics that indicated predominant 
off-highway use, the final program excludes all non-box trailer types 
except for three specific types that we believe are designed for and 
mostly used in on-road applications. These types are tanks, flatbeds, 
and container chassis, as defined in the previous sub-section. We now 
consider this approach to be much clearer and more straightforward to 
implement than the proposed approach. Manufacturers of these types of 
trailers can easily obtain and install LRR tires and tire pressure 
systems, and achieve the most consistent benefit from use of these 
technologies. The trailer program excludes all trailers that do not 
meet the criteria outlined in Section IV.C.(1)(b) above, and specified 
in 40 CFR 1037.5 and in 49 CFR 535.3(e).
    The final rule also excludes certain types of trailers based on 
design

[[Page 73647]]

characteristics, consistent with the proposed rule. More precisely, 
these excluded trailer types are sub-types of otherwise regulated 
trailer types, such as certain types of box vans. First, the rule 
excludes trailers intended to haul very heavy loads, as indicated by 
the number of axles. Specifically, the rules exclude all trailers with 
four or more axles, and trailers less than 35 feet long with three 
axles. For example, a 53-foot box van with four axles would be 
excluded. Also, we agree with Utility that spread-axle trailers may be 
more susceptible to tire scrubbing, and the program accordingly 
excludes trailers with an axle spread of at least 120 inches between 
adjacent axle centerlines. The axle spread exclusion does not apply to 
trailers with adjustable axles that have the ability to be spaced less 
than 120 inches apart. Finally, the rules exclude trailers intended for 
temporary or permanent residence, office space, or other work space, 
such as campers, mobile homes, and carnival trailers.\340\
---------------------------------------------------------------------------

    \340\ Secondary manufacturers who purchase incomplete trailers 
and complete their construction to serve as trailers are subject to 
the requirements of 40 CFR 1037.620 and 49 CFR 535.5(e).
---------------------------------------------------------------------------

    Manufacturers of excluded trailers have no reporting or other 
regulatory requirements under the trailer program. See 40 CFR 1037.5 
and 49 CFR 535.3 for complete definitions of the trailer types that the 
program excludes. However, where the criteria for exclusion identified 
above may be unclear for specific trailer models, manufacturers are 
encouraged to ask the agencies to make a determination before 
production begins.
(2) Fuel Consumption and CO2 Standards
    As described previously in Section I, it is the combination of the 
tractor and the trailer that form the useful vehicle, and trailer 
designs substantially affect the CO2 emissions and fuel 
consumption of the tractors pulling them. Note that although the 
agencies are adopting new CO2 and fuel consumption standards 
for trailers separately from tractors, we set the numerical level of 
the trailer standards (see Section IV.D. below) based on operation with 
``standard'' reference tractors in recognition of their 
interrelatedness. In other words, the regulatory standards refer to the 
simulated emissions and fuel consumption of a standard tractor pulling 
the trailer being certified.
    Unlike the other sectors covered by this Phase 2 rulemaking, 
trailer manufacturers do not have experience certifying under the Phase 
1 program (or under EPA's criteria pollutant program). Moreover, a 
large fraction of the trailer industry is composed of small businesses 
and even the largest trailer manufacturers do not have the same 
resources available to them as do manufacturers in some of the other 
heavy-duty sectors. The standards and compliance regime for trailers 
have been developed with this in mind, and we are confident these 
standards can be achieved and demonstrated by manufacturers who lack 
prior experience implementing such standards.
    The agencies designed this trailer program to ensure a gradual 
progression of both stringency and compliance requirements in order to 
limit the impact on this newly-regulated industry. The agencies are 
adopting progressively more stringent standards in three-year stages 
leading up to the MY 2027,\341\ and are including several options to 
reduce compliance burden in the early years as the industry gains 
experience with the program (see Section IV.E.). EPA will initiate its 
program in MY 2018 with standards for long box dry and refrigerated 
vans, which standards can be met with common tire technologies and 
SmartWay-verified aerodynamic devices and standards for the other 
regulated trailers based on tire technologies only. In this early 
stage, we expect that manufacturers of trailers in the other trailer 
subcategories will meet their standards by using tire technologies 
only. NHTSA's regulations will be voluntary until MY 2021 as described 
in Section IV.C.(2).
---------------------------------------------------------------------------

    \341\ These stages are consistent with NHTSA's stability 
requirements under EISA.
---------------------------------------------------------------------------

    Standards for the next stages, which begin in MY 2021, gradually 
increase in stringency for each subcategory, including the introduction 
of standards for short box vans that we expect will be met by applying 
both aerodynamic and tire technologies. The standards for partial-aero 
box vans are less stringent than those for full-aero box vans, 
reflecting that the standards for partial-aero vans are based on 
adoption of a single aerodynamic device throughout the program. This is 
in contrast to the proposed standards for partial-aero vans that were 
identical to the standards for full-aero vans through MY 2026.
    Table IV-2 and Table IV-3 below present the CO2 and fuel 
consumption standards, beginning in MY 2018 that the agencies are 
adopting for full- and partial-aero box vans, respectively. The 
standards are expressed in grams of CO2 per ton-mile and 
gallons of fuel per 1,000 ton-miles to reflect the load-carrying 
capacity of the trailers.

               Table IV-2--Trailer CO[ihel2] and Fuel Consumption Standards for Full-Aero Box Vans
----------------------------------------------------------------------------------------------------------------
                                   Subcategory                Dry van                    Refrigerated van
          Model year           ---------------------------------------------------------------------------------
                                     Length            Long            Short           Long            Short
----------------------------------------------------------------------------------------------------------------
2018-2020.....................  EPA Standard....            81.3           125.4            83.0           129.1
                                (CO[ihel2] Grams
                                 per Ton-Mile)
                                Voluntary NHTSA          7.98625        12.31827         8.15324        12.68173
                                 Standard.
                                (Gallons per
                                 1,000 Ton-Mile)
2021-2023.....................  EPA Standard....            78.9           123.7            80.6           127.5
                                (CO[ihel2] Grams
                                 per Ton-Mile)
                                NHTSA Standard..         7.75049        12.15128         7.91749        12.52456
                                (Gallons per
                                 1,000 Ton-Mile)
2024-2026.....................  EPA Standard....            77.2           120.9            78.9           124.7
                                (CO[ihel2] Grams
                                 per Ton-Mile)
                                NHTSA Standard..         7.58350        11.87623         7.75049        12.24951
                                (Gallons per
                                 1,000 Ton-Mile)
2027+.........................  EPA Standard....            75.7           119.4            77.4           123.2
                                (CO[ihel2] Grams
                                 per Ton-Mile)
                                NHTSA Standard..         7.43615        11.72888         7.60314        12.10216
                                (Gallons per
                                 1,000 Ton-Mile)
----------------------------------------------------------------------------------------------------------------


[[Page 73648]]


             Table IV-3--Trailer CO[ihel2] and Fuel Consumption Standards for Partial-Aero Box Vans
----------------------------------------------------------------------------------------------------------------
                                   Subcategory                Dry van                    Refrigerated van
          Model year           ---------------------------------------------------------------------------------
                                     Length            Long            Short           Long            Short
----------------------------------------------------------------------------------------------------------------
2018-2020.....................  EPA Standard....            81.3           125.4            83.0           129.1
                                (CO[ihel2] Grams
                                 per Ton-Mile)
                                Voluntary NHTSA          7.98625        12.31827         8.15324        12.68173
                                 Standard.
                                (Gallons per
                                 1,000 Ton-Mile)
2021+.........................  EPA Standard....            80.6           123.7            82.3           127.5
                                (CO[ihel2] Grams
                                 per Ton-Mile)
                                NHTSA Standard..         7.91749        12.15128         8.08448        12.52456
                                (Gallons per
                                 1,000 Ton-Mile)
----------------------------------------------------------------------------------------------------------------

    The agencies are not adopting CO2 or fuel consumption 
standards predicated on aerodynamic improvements for non-box trailers 
or non-aero box vans at any stage of this program. Instead, we are 
adopting design standards that require manufacturers of these trailers 
to adopt specific tire technologies and thus to comply without 
aerodynamic devices. This approach significantly limits the compliance 
burden for these manufacturers, especially if they do not also 
manufacture box vans subject to the aerodynamic requirements. The 
agencies are adopting these design standards in two stages. In MY 2018, 
the non-box trailer standards require manufacturers to use tires 
meeting a rolling resistance of 6.0 kg/ton or better and to install 
tire pressure systems. In MY 2021, non-box trailers will also need tire 
pressure systems and LRR tires at 5.1 kg/ton (the current SmartWay-
verification threshold) or better. The standards require non-aero box 
vans, which we believe are largely at a baseline rolling resistance 6.0 
kg/ton today, to install tire pressure monitoring systems and tires at 
a rolling resistance of 5.1 kg/ton in MY 2018 and 4.7 kg/ton in MY 2021 
and later (there are no further increases in standard stringency for 
these trailers after MY 2021). For non-box trailers and non-aero box 
vans, manufacturers may install either TPMS or ATIS for compliance.
    Table IV-4 summarizes the two stages of these design standards.

               Table IV-4--Design-Based Tire Standards for Non-Box Trailers and Non-Aero Box Vans
----------------------------------------------------------------------------------------------------------------
               Model year                          Tire technology           Non-box trailers  Non-aero box vans
----------------------------------------------------------------------------------------------------------------
2018-2020...............................  Tire Rolling Resistance Level                  6.0                5.1
                                           (kg/ton).
                                          Tire Pressure System............      TPMS or ATIS       TPMS or ATIS
2021+...................................  Tire Rolling Resistance Level                  5.1                4.7
                                           (kg/ton).
                                          Tire Pressure System............      TPMS or ATIS       TPMS or ATIS
----------------------------------------------------------------------------------------------------------------

    The agencies project that the standards for the entire class of 
regulated trailers, when fully implemented in MY 2027, will achieve 
fuel consumption and CO2 emissions reductions of two to nine 
percent relative to mostly market-driven adoption absent a national 
regulatory program (see Section IV.D.(2)). Because of the rapid pace of 
technological improvement in recent years and the lead time of nearly a 
decade, the agencies expect that both trailer designs and bolt-on 
CO2- and fuel consumption-reducing technologies will advance 
well beyond the performance of their present-day counterparts. 
Regardless, we expect that the MY 2027 standards for full-aero box vans 
could be met with high-performing aerodynamic and tire technologies 
largely available in the marketplace today. A description of 
technologies that the agencies considered in developing these rules is 
provided in Section IV.D., with additional details in RIA Chapter 2.10.
(3) Non-CO2 GHG Emissions From Trailers
    In addition to the impact of trailer design on the CO2 
emissions of tractor-trailer vehicles, EPA recognizes that refrigerated 
trailers can also be a source of emissions of HFCs. Specifically, HFC 
refrigerants that are used in transport refrigeration units (TRUs) have 
the potential to leak into the atmosphere.
    In their comments, CARB said they believed that EPA underestimated 
the potential for TRU refrigerant leakage, and requested that EPA (1) 
initiate a TRU refrigerant ``usage monitoring program'' to support 
future evaluations of leakage; (2) create incentives for low- and zero-
emission (e.g., cryogenic) TRUs; and (3) for EPA's SNAP program to 
phase out the main TRU refrigerant (R404a) when viable alternatives are 
available. EPA did not propose any action related to TRUs in this rule, 
and CARB did not provide sufficient information for EPA to introduce 
new regulatory requirements for TRUs at this time. In general, however, 
EPA will continue to monitor the state of TRU technology and operation, 
and may pursue appropriate action if warranted in the future.
    We also note that EPA has separately proposed a regulation under 
Title VI of the CAA, specifically section 608. See 80 FR 69457 
(November 9, 2015). This proposal would extend existing regulations on 
ozone depleting refrigerants to many alternative refrigerants, such as 
HFCs, which are the most common refrigerants used in TRUs.\342\ If 
finalized as proposed, EPA would require that appliances like TRUs be 
subject to the applicable requirements of 40 CFR subpart F, including 
requirements for servicing by a certified technician using certified 
recovery equipment and for recordkeeping by technicians disposing of 
such appliances with a charge size between five and fifty pounds, which

[[Page 73649]]

would include TRUs, to help ensure that the refrigerant is not 
vented.\343\
---------------------------------------------------------------------------

    \342\ Under the proposal, the regulations would not be extended 
to equipment using a substitute refrigerant when that use of the 
refrigerant has been exempted from the venting prohibition, as 
listed in 40 CFR 82.154(a).
    \343\ The Clean Air Act (42 U.S.C. 7671) uses the term 
``appliance'' to refer to TRUs and other similar equipment.
---------------------------------------------------------------------------

(4) Lead-Time Considerations
    As mentioned earlier, although the agencies did not include 
standards for trailers in Phase 1, box van manufacturers have been 
gaining experience with CO2- and fuel consumption-reducing 
technologies over the past several years, and the agencies expect that 
trend to continue, due in part to EPA's SmartWay program and 
California's Tractor-Trailer Greenhouse Gas Regulation. Most 
manufacturers of 53-foot box vans have some experience installing these 
aerodynamic and tire technologies for customers. Manufacturers of 
trailers other than 53-foot box vans do not have the benefit of 
programs such as SmartWay to provide a reliable evaluation and 
promotion of aerodynamic technologies for those trailers and therefore 
have less experience with those technologies. However, all trailer 
manufacturers have experience installing tires and the installation 
process does not change with the use of lower rolling resistance tires. 
Some manufacturers may not have direct experience with tire pressure 
systems, but we observe that they are mechanically fairly simple and 
can be incorporated into trailer production lines without significant 
process changes.
    EPA is adopting CO2 emission standards for long box vans 
for MY 2018 that represent stringency levels similar to the current 
performance level needed for SmartWay's verification and those required 
for the current California regulation. These standards can be met by 
adopting off-the-shelf aerodynamic and tire technologies available 
today. The agencies are adopting less stringent requirements for 
manufacturers of other highway trailer subcategories beginning in MY 
2018 that can be met without use of aerodynamic technologies. Given 
that these technologies are readily available and are already familiar 
to the industry, the agencies believe, for both cases, that 
manufacturers have sufficient lead time to adopt these technologies and 
to implement the simplified compliance provisions introduced below and 
described fully in Section IV.E.
    NHTSA's direction under EISA is to allow four model years of lead-
time for new fuel consumption standards, regardless of the stringency 
level or availability of flexibilities. Therefore, NHTSA's fuel 
consumption requirements are not mandatory until MY 2021. Prior to MY 
2021, trailer manufacturers could voluntarily participate in NHTSA's 
program, noting that once they made such a choice, they will need to 
stay in the program for all succeeding model years.\344\
---------------------------------------------------------------------------

    \344\ NHTSA adopted a similar voluntary approach in the first 
years of Phase 1 (see 76 FR 57106).
---------------------------------------------------------------------------

    We believe there are technology pathways available today that 
manufacturers could use to comply with the standards when they are 
fully implemented in MY 2027. The agencies designed each three-year 
stage of the program as a gradual progression of stringency that 
provides sufficient lead-time for all affected trailer manufacturers to 
evaluate and adopt CO2- and fuel consumption-reducing 
technologies or design trailers to meet these standards while meeting 
their customers' needs. The agencies believe that the burdens of 
installing and marketing these CO2- and fuel consumption-
reducing technologies at the stringency levels of this program are not 
limiting factors in determining necessary lead-time for manufacturers 
of these trailers. Instead, we expect that the first-time compliance 
and, in some cases, performance testing, will be more challenging 
obstacles for this newly regulated industry. For these reasons, the 
standards phase in over a period of nine years, with flexibilities to 
minimize the compliance and testing burdens especially in the early 
years of the program (see Section IV.E.). We are adopting provisions 
for manufacturers to use a GEM-based compliance equation in lieu of the 
GEM vehicle simulation tool, which will reduce the number of resources 
required to learn and implement the model. We are also finalizing 
compliance provisions that allow trailer manufacturers to use pre-
approved aerodynamic test data from aerodynamic device manufacturers, 
which could eliminate a trailer manufacturer's test burden for 
compliance. As explained above, non-aero box vans and non-box trailers, 
which make up almost 20 percent of the regulated trailers, are subject 
to straightforward design-based tire standards throughout the program 
that require that they install qualified LRR tires and tire pressure 
systems with simplified compliance requirements. See Section IV.E. for 
a full description of the trailer compliance program.
    The Rubber Manufacturers Association (RMA) expressed concern that 
the proposed program would not provide sufficient lead time for the 
development and production of LRR tire designs for some off-road 
applications. As discussed above, the final program now excludes all 
trailer types that would generally be used in off-road applications, 
including all non-box trailers except tanks, flatbeds, and container 
chassis. Therefore, trailer types designed for off-road use do not have 
LRR tire requirements, and the final program should significantly 
reduce RMA's concerns about available lead time for special tire 
development. Additionally, we have adjusted the tire performance 
requirements for the LRR tires of the non-box trailer design standards.

D. Feasibility of the Trailer Standards

    As discussed below, the agencies' determination is that the 
standards presented in Section IV.C.(2), are the maximum feasible and 
appropriate under the agencies' respective authorities, considering 
lead time, cost, and other factors. We summarize our analyses in this 
section, and describe them in more detail in RIA Chapter 2.10.
    Our analysis of the feasibility of the CO2 and fuel 
consumption standards is based on technology cost and effectiveness 
values collected from several sources. Our assessment of the trailer 
program is based on information from:

--Southwest Research Institute evaluation of heavy-duty vehicle fuel 
efficiency and costs for NHTSA,\345\
---------------------------------------------------------------------------

    \345\ Reinhart, T.E. (June 2015). Commercial Medium- and Heavy-
Duty Truck Fuel Efficiency Technology Study--Report #1. (Report No. 
DOT HS 812 146). Washington, DC: National Highway Traffic Safety 
Administration.
---------------------------------------------------------------------------

--2010 National Academy of Sciences report of Technologies and 
Approaches to Reducing the Fuel Consumption of Medium- and Heavy-Duty 
Vehicles,\346\
---------------------------------------------------------------------------

    \346\ Committee to Assess Fuel Economy Technologies for Medium- 
and Heavy-Duty Vehicles; National Research Council; Transportation 
Research Board (2010). Technologies and Approaches to Reducing the 
Fuel Consumption of Medium- and Heavy-Duty Vehicles. (``The NAS 
Report'') Washington, DC, The National Academies Press. Available 
electronically from the National Academy Press Web site at http://www.nap.edu/catalog.php?record_id=12845.
---------------------------------------------------------------------------

--TIAX's assessment of technologies to support the NAS panel 
report,\347\
---------------------------------------------------------------------------

    \347\ TIAX, LLC. ``Assessment of Fuel Economy Technologies for 
Medium- and Heavy-Duty Vehicles,'' Final Report to National Academy 
of Sciences, November 19, 2009.
---------------------------------------------------------------------------

--The analysis conducted by the Northeast States Center for a Clean Air 
Future, International Council on Clean Transportation, Southwest 
Research Institute and TIAX for reducing fuel consumption of heavy-

[[Page 73650]]

duty long haul combination tractors (the NESCCAF/ICCT study),\348\
---------------------------------------------------------------------------

    \348\ NESCCAF, ICCT, Southwest Research Institute, and TIAX. 
Reducing Heavy-Duty Long Haul Combination Truck Fuel Consumption and 
CO2 Emissions. October 2009.
---------------------------------------------------------------------------

--The technology cost analysis conducted by ICF for EPA,\349\ and
---------------------------------------------------------------------------

    \349\ ICF International. ``Investigation of Costs for Strategies 
to Reduce Greenhouse Gas Emissions for Heavy-Duty On-Road 
Vehicles.'' July 2010. Docket Number EPA-HQ-OAR-2010-0162-0283.
---------------------------------------------------------------------------

--Testing conducted by EPA.

    As an initial step in our analysis, we identified the extent to 
which fuel consumption- and CO2-reducing technologies are in 
use today. The technologies include those that reduce aerodynamic drag 
at the front, back, and underside of trailers, tires with lower rolling 
resistance, tire pressure technologies, and weight reduction through 
component substitution. For our feasibility analysis, we identified a 
set of technologies to represent the range of those likely to be used 
in the time frame of the rule. The agencies developed the 
CO2 and fuel consumption standards for each stage of the 
program by combining the projected effectiveness of trailer 
technologies and the projected adoption rates for each trailer type. It 
should be noted that the agencies need not and did not attempt to 
predict the exact future pathway of the industry's response to the new 
performance standards for box vans. Rather, we demonstrated one example 
compliance pathway that could reasonably occur, taking into account 
cost of the standards (including costs of compliance testing and 
certification), and needed lead time. More details regarding our 
analysis can be found in Chapter 2.10 of the RIA.
(1) Technological Basis of the Standards
    Trailer manufacturers can design a trailer to reduce fuel 
consumption and CO2 emissions by addressing the trailer's 
aerodynamic drag, tire rolling resistance, and weight. Accordingly, the 
agencies investigated aerodynamic technologies (e.g., skirts and 
tails), low rolling resistance tires, tire pressure systems, and 
materials that could be used to reduce trailer weight. A description of 
these technologies, including their expected performance, can be found 
in Chapter 2.10.2 of the RIA. For box vans, the analysis below presents 
one possible set of technology designs by which trailer manufacturers 
could reasonably achieve the standards. However, in practice, trailer 
manufacturers could choose different technologies, versions of 
technologies, and combinations of technologies that meet the business 
needs of their customers while complying with this program.
    To minimize complexity, a single van is used to represent each box 
van trailer subcategory in compliance and in our feasibility analysis. 
Within the short box dry and refrigerated van subcategories (50-foot 
and shorter), the largest fraction of those trailers are 28 feet in 
length. Similarly, 53-foot vans make up the majority of the long box 
dry and refrigerated vans. Consequently, a 28-foot dry van is used to 
represent all lengths of short dry vans and a 53-foot dry van 
represents all lengths of long dry vans in this analysis and for 
compliance. Similar lengths represent the short and long refrigerated 
van subcategories. This means that manufacturers do not need to analyze 
the performance of devices for each trailer length in each subcategory. 
This approach provides a conservative estimate of CO2 
emissions and fuel consumption reductions for the longer vans within a 
given length subcategory,\350\ but the agencies believe that the need 
to avoid an overly complex compliance program, reinforced by most of 
the industry comments, justifies this approach.
---------------------------------------------------------------------------

    \350\ For example, aerodynamic devices on a 48 foot box van will 
perform somewhat better than on a 28 foot box van, so our analysis 
likely underestimates the benefits of these technologies. See 
Chapter 2.10.2.1.2.6 of the RIA and Memorandum to Docket EPA-HQ-OAR-
2014-0827. ''
---------------------------------------------------------------------------

(a) Aerodynamic Technologies
    For box vans under these rules, aerodynamic performance of tractor-
trailers is evaluated using a vehicle's aerodynamic drag area, 
CdA. However, unlike the tractor program, the performance of 
trailer technologies is quantified using changes in CdA (or 
``delta CdA'') rather than absolute values. This delta 
CdA classification methodology, which measures improvement 
in performance relative to a baseline, is similar to the SmartWay 
technology verification program with which most long box van 
manufacturers are already familiar. The one difference is that, 
although EPA's SmartWay aerodynamic verification program uses a 
relative improvement, the metric is a percent fuel savings, whereas the 
compliance program for Phase 2 uses change in drag area, delta 
CdA. Chapter 2.10.2.1.1 of the RIA provides a comparison of 
the SmartWay and Phase 2 metrics.
    The agencies proposed to use a delta CdA measured at 
zero-yaw (head-on wind) in the trailer aerodynamic test procedures (80 
FR 40277). However, comments from several stakeholders including ACEEE, 
CARB, ICCT, RMA, STEMCO, and Utility suggested that measurements that 
account for cross-wind provide a more appropriate measure of the 
benefits these technologies would experience in the real world, 
especially for technologies that are effective when the wind is at an 
angle. The agencies evaluated our own aerodynamic test data, including 
data collected to justify use of wind-average results in the proposed 
tractor program, and we recognize that the drag coefficient increases 
under cross-wind conditions likely seen in real-world operation. Since 
wind-averaging will account for this, and more appropriately capture 
aerodynamic benefits from many devices, including several small-scale 
devices, we are adopting a wind-averaged approach for aerodynamic 
testing in the trailer program. See Section IV.E.(3)(b)(ii) below and 
Chapter 2.10.2.1.2 of the RIA for a summary of yaw-angle effect as 
observed in our aerodynamic testing. The feasibility analysis that 
follows was performed using wind-averaged delta CdA values.
(i) Aerodynamic Technologies for Non-Box Trailers
    The agencies are aware that some side skirts have been adapted for 
the non-box trailers considered in this rule (e.g., tank trailers, 
flatbeds, and container chassis). CARB submitted comments noting that 
some of these technologies have shown potential for large reductions in 
drag. At this time, however, we are unable to sufficiently assess the 
degree of CO2 and fuel consumption improvement that could 
generally be achieved across this segment of the industry and the 
associated costs of these technologies. In the case of each of the 
general non-box trailer types included in the trailer program, the 
range of physical trailer designs, including the areas where 
aerodynamic devices would be installed, is great, and technologies to 
date tend to be designed for narrow applications. This lack of basic 
information about the applicability of future technologies for these 
trailer types also inhibits our ability to estimate costs, either of 
the specific future designs themselves or of the size of the market for 
any particular product. As a result, we expect that standards 
predicated on aerodynamic technologies for these trailer types could 
result in relatively little emission and fuel consumption improvement 
at relatively high costs. We will continue to monitor this segment of 
the trailer industry in this regard and may consider further action in 
the future.
    The agencies proposed to adopt design-based tire standards (i.e.

[[Page 73651]]

standards not predicated on any aerodynamic technology, and for which 
neither GEM nor the GEM-based equation is required) for these trailers 
to eliminate the need for performance testing and to reduce the overall 
compliance burden for these manufacturers. 80 FR 40257. The data 
submitted and adoption rates suggested by CARB would not provide a 
large enough reduction in CO2 and fuel consumption from non-
box trailer aerodynamics to justify the increased burden on these 
manufacturers. In addition, we believe that there is not currently 
sufficient information to develop aerodynamic performance standards on 
these relatively new and untried technologies. Consequently, we are 
adopting design-based tire technology standards for non-box trailers, 
as proposed. Non-box trailer manufacturers may include aerodynamic 
improvements in their future trailer designs, but non-box trailer 
aerodynamic devices cannot be used for compliance at any point in the 
Phase 2 program.
(ii) Aerodynamic Technologies for Box Vans
    EPA collected aerodynamic test data for several tractor-trailer 
configurations equipped with technologies similar to common SmartWay-
verified technologies. As mentioned previously, SmartWay-verified 
technologies are evaluated on 53-foot dry vans. However, the 
CO2- and fuel consumption-reducing potential of some 
aerodynamic technologies demonstrated on 53-foot dry vans can be 
translated to refrigerated vans and box trailers of other lengths. Some 
fleets have opted to add trailer skirts to their refrigerated vans and 
28-foot trailers and our testing included dry vans of length 53-foot, 
48-foot, 33-foot, and 28-foot.\351\
---------------------------------------------------------------------------

    \351\ Although, as noted above, compliance testing (where 
required) uses either a 28 foot van or 53 foot van to simplify the 
compliance process.
---------------------------------------------------------------------------

    In order to evaluate performance and cost of the aerodynamic 
technologies, the agencies identified ``packages'' of individual or 
combined technologies that are being sold today on box trailers. The 
agencies also identified distinct performance levels (i.e., bins) for 
these technology packages based on EPA's aerodynamic testing. All 
technology packages that produce similar improvements in drag would be 
categorized as meeting the same bin level of performance. The agencies 
recognize that there are other technology options that have similar 
performance to those that we analyzed. We chose the technologies 
presented here based on their current adoption rates and availability 
of test data.
    The agencies are adopting a regulatory structure for box trailers 
with seven bins to evaluate aerodynamic performance. Note that these 
bins are slightly different than those proposed. We adjusted the 
aerodynamic bins to reflect additional data and the use of wind-
averaged results. The most notable difference is that we expanded the 
width of the lower bins. The NPRM Bins III, IV and V were reduced to 
two bins. Bins V, VI, and VII are identical to the highest bins from 
the NPRM (NPRM bins VI, VII, and VIII). See Chapter 2.10.2.1.3 of the 
RIA for a complete description of the development of these bins.
    In the final trailer program, Bin I represents a base trailer with 
no aerodynamic technologies added and a delta CdA of zero. 
Bin II is intended to capture aerodynamic devices that achieve small 
reductions in CO2 and fuel consumption. Some gap reducers 
may achieve Bin II on long dry vans, and most individual devices (e.g., 
skirts or tails) will achieve this bin for short box vans. We expect a 
majority of single aerodynamic devices to perform in the range of Bins 
III through IV for long box vans. Combinations of devices are expected 
to meet Bin III for short vans and Bin V or Bin VI levels of 
performance for long vans. Bin VI represents the more optimized 
combinations of technologies on long vans. The agencies observed one 
device combination that met Bin VI in our aerodynamic testing and did 
not observe any combinations that meet Bin VII. This final level is 
designed to represent aerodynamic improvements that may become 
available in the future, including aerodynamic devices yet to be 
designed or approaches that incorporate changes to the design of 
trailer bodies. The agencies believe there is ample lead time to 
optimize additional existing Bin V combinations such that they can also 
meet Bin VI by MY 2027. However, none of the standards are predicated 
on the performance of Bin VII aerodynamic improvements. See Table IV-14 
and accompanying text.
    Table IV-5 illustrates the bin structure that the agencies are 
adopting as the basis for box vans to demonstrate compliance. The 
agencies believe these bins apply to all box vans (dry and refrigerated 
vans of various lengths). Although the underlying test data from EPA's 
aerodynamic testing program reflect some variation due to differences 
in test methods, as well as differences in trailer and aerodynamic 
device models, the agencies believe that each of these bins covers a 
wide enough range of delta CdAs to account for the 
uncertainty. See RIA Chapter 2.10 for more information.
    When manufacturers obtain test results, they would check the range 
shown in Table IV-5 for the measured CdA value and use the 
corresponding input value for compliance. Note that these are wind-
averaged results, as described in Chapter 2.10 of the RIA and below in 
Section IV.E.(3)(b)(ii). Also, the input is a threshold and not an 
average of the bin range. Consequently, the compliance results will be 
a conservative estimate of the performance of most technologies that 
achieve a given bin.\352\
---------------------------------------------------------------------------

    \352\ This is in contrast to the tractor program where 
manufacturers obtain absolute CdA values in tractor 
aerodynamic testing. The tractor results are corrected to coastdown 
values before applying them to bins and obtaining a bin-average 
value as a compliance input. Trailers measure a delta CdA 
and do not have a correction to a reference method (see Section 
IV.E.(3)(b)). The lower threshold approach adopted for the trailer 
compliance inputs limits the chance of over-predicting performance 
when a reference method correction is not applied.

 Table IV-5--Technology Bins Used To Evaluate Trailer Benefits and Costs
------------------------------------------------------------------------
                                                 Delta CdA
                                 ---------------------------------------
               Bin                                          Input value
                                      Measured value      for compliance
------------------------------------------------------------------------
Bin I...........................  <0.10.................             0.0
Bin II..........................  0.10-0.39.............             0.1
Bin III.........................  0.40-0.69.............             0.4
Bin IV..........................  0.70-0.99.............             0.7
Bin V...........................  1.00-1.39.............             1.0
Bin VI..........................  1.4-1.79..............             1.4
Bin VII.........................  >=1.80................             1.8
------------------------------------------------------------------------

    To develop the standards for box trailers, the agencies assessed 
the CO2 emissions and fuel consumption impacts of the 
aerodynamic bins using an equation based on the GEM vehicle simulation 
tool. See Section II and Section IV.E. (1) for more information about 
GEM and Chapter 2.10.5 of the RIA for our development of the GEM-based 
equation. Within GEM, and reflected in the results of the equation, the 
aerodynamic performance of each box van subcategory is evaluated by 
subtracting the delta CdA shown in Table IV-5 from the 
CdA value representing a specific standard tractor pulling a 
trailer with no CO2- or fuel consumption-reducing 
technologies (i.e., a ``no-control'' trailer). In other words, the 
tractor-trailer is simulated with improvements to the baseline trailer. 
The agencies chose to model the no-control long box dry van using a 
CdA value of 6.0 m\2\ (the mean wind-averaged CdA 
from EPA's wind tunnel

[[Page 73652]]

testing). The single, short box dry vans showed lower CdA 
values compared to its 53-foot counterpart in EPA's wind tunnel testing 
with an average of 5.6 m\2\. The agencies did not test any refrigerated 
vans, but we assumed a refrigerated van's TRU would behave similar to a 
gap reducer. Our test results in Chapter 2.10.2.1.3 did not show gap 
reducer technologies to have a significant effect on CdA and 
the agencies accordingly assigned the same default CdA to 
refrigerated and dry box vans in GEM. Note that the trailer 
subcategories that have design standards (i.e., non-box and non-aero 
box trailers) do not have numerical standards to meet, and do not have 
defaults in GEM. Table IV-6 illustrates the no-control drag areas 
(CdA) associated with each trailer subcategory.

 Table IV-6--Default Aerodynamic Drag Area (CdA) Values Associated With
                Each (No-Control) Trailer Modeled in GEM
------------------------------------------------------------------------
                   Trailer subcategory                      CdA (M\2\)
------------------------------------------------------------------------
Long Dry Van............................................             6.0
Short Dry Van...........................................             5.6
Long Ref. Van...........................................             6.0
Short Ref. Van..........................................             5.6
------------------------------------------------------------------------

    Current ``boat tail'' devices, applied to the rear of a trailer 
with rear swing doors, are typically designed to collapse flat as the 
trailer rear doors are opened. If the tail structure can remain in the 
collapsed configuration when the doors are closed, the benefit of the 
device is lost. We requested comment on whether we should require that 
trailer manufacturers using such devices for compliance with these 
standards only use designs that automatically deploy when the vehicle 
is in motion. STEMCO commented that automatic deployment should not be 
required, since those systems are more expensive, and in their view, 
not necessary for the Phase 2 program. STEMCO believes that, since 
there is a strong economic incentive for operators to ensure that the 
devices are correctly deployed in order to achieve the greatest fuel 
cost payback, a regulatory requirement related to deployment is not 
needed. We generally agree, and have not included such a requirement in 
the final trailer program. For this analysis, we consider all boat 
tails to be properly deployed.
    The agencies are aware that physical characteristics of some box 
trailers influence the technologies that can be applied. For instance, 
the TRUs on refrigerated vans are located at the front of the trailer, 
which prevents the use of current gap-reducers, either by occupying the 
space that a front-end fairing would use, or by blocking air flow that 
the TRU needs for cooling purposes. Similarly, drop deck dry vans have 
lowered floors between the landing gear and the trailer axles that 
limit the ability to use side skirts. We discuss another example, roll-
up rear doors, in Section IV.C.(1)(a) above. The agencies considered 
the availability and limitations of aerodynamic technologies for each 
trailer type evaluated in our feasibility analysis of the standards.
(b) Tire Rolling Resistance
    Similar to the Phase 2 tractor and vocational vehicle programs, the 
agencies are adopting standards based on adoption of lower rolling 
resistance tires. While some box vans continue to be sold with tires of 
higher rolling resistances, the agencies believe most box van tires 
currently achieve a tire CRR of 6.0 kg/ton or better. 
Feedback from several box trailer manufacturers indicates that the 
standard tires offered on their new trailers are SmartWay-verified 
tires (i.e., CRR of 5.1 kg/ton or better). An informal 
survey of members from the Truck Trailer Manufacturers Association 
(TTMA) in 2014 indicates about 85 percent of box vans sold at that time 
had SmartWay tires.\353\
---------------------------------------------------------------------------

    \353\ Letter, Truck Trailer Manufacturers Association to EPA. 
Received on October 16, 2014. Docket EPA-HQ-OAR-2014-0827-0146.
---------------------------------------------------------------------------

    The agencies evaluated two levels of tire performance for box vans 
beyond the baseline trailer tire rolling resistance level (TRRL) of 6.0 
kg/ton. The first performance level was set at the criteria for 
SmartWay-verification for trailer tires, 5.1 kg/ton, which is a 15 
percent reduction in CRR from the baseline. As mentioned 
previously, several tire models available today achieve rolling 
resistance values well below the present SmartWay threshold. Given the 
multiple year phase-in of the standards, the agencies expect that tire 
manufacturers will continue to respond to demand for more efficient 
tires and will offer increasing numbers of tire models with rolling 
resistance values significantly better than today's typical LRR tires. 
In this context, we believe it is reasonable to expect a large fraction 
of the trailer industry could adopt tires with rolling resistances at a 
second performance level that will achieve an additional reduction in 
rolling resistance, especially in the later stages of the program. The 
agencies project the CRR for this second level of 
performance to be a value of 4.7 kg/ton (a 22 percent reduction from 
the baseline tire).
    The vast majority of box van miles occur on-road, and current LRR 
tire designs are appropriate and effective for those applications. We 
note that current designs of LRR tires may not be appropriate for some 
non-box trailer types, including those that operate significantly in 
off-road conditions. We expect that the tire manufacturing industry 
will continue to expand their offerings of tire designs to additional 
applications. Regardless, by limiting the non-box trailer types covered 
by the final trailer program to those generally used in on-highway 
applications (tanks, flatbeds, and container chassis), the program 
avoids most of these potential situations.
    We received comment from Michelin supporting the use of 6.0 kg/ton 
as the box trailer tire rolling resistance baseline, but they expressed 
concern that the SmartWay threshold of 5.1 kg/ton does not apply for 
non-box trailers, and could compromise their operation. Similarly, the 
Rubber Manufacturers Association indicated that a baseline of 6.0 kg/
ton does not apply to non-box trailers. The agencies agree that the 
baseline tires for non-box trailers should have a higher rolling 
resistance, but we did not receive any comments that included 
CRR data. For the analysis for the final rules, the agencies 
revised the baseline CRR to a value of 6.5 kg/ton for non-
box trailer manufacturers. The updated non-box trailer designs 
standards require LRR tires of 6.0 kg/ton in the first stage of the 
program and 5.1 kg/ton in the later years. Nowhere in the final program 
do we require Level 4 tires for non-box trailers.
    The agencies evaluated four tire rolling resistance levels, 
summarized in Table IV-7, in the feasibility analysis of the following 
sections. It should be noted that these levels are targets for setting 
the stringency of the box van performance standards and rolling 
resistance thresholds for the non-box design standards. For compliance, 
box van manufacturers have the option to use tires with any rolling 
resistance and are not be limited to these TRRLs.

 Table IV-7--Summary of Trailer Tire Rolling Resistance Levels Evaluated
------------------------------------------------------------------------
                                                           CRR (kg/ton)
              Tire rolling resistance level
------------------------------------------------------------------------
Level 1 (Non-Box Baseline)..............................             6.5
Level 2 (Box Van Baseline ).............................             6.0
Level 3.................................................             5.1
Level 4.................................................             4.7
------------------------------------------------------------------------

(c) Tire Pressure Systems
    Tire pressure monitoring systems (TPMS) and automatic tire 
inflation systems (ATIS) are designed to address under-inflated tires. 
Both systems alert

[[Page 73653]]

drivers if a tire's pressure drops below its set point. TPMS are 
simpler and merely monitor tire pressure. Thus, they require user-
interaction to reinflate to the appropriate pressure. Today's ATIS, on 
the other hand, typically take advantage of trailers' air brake systems 
to supply air back into the tires (continuously or on demand) until a 
selected pressure is achieved. In the event of a slow leak, ATIS have 
the added benefit of maintaining enough pressure to allow the driver to 
get to a safe stopping area. See Chapter 2.10.2.3 of the RIA for more 
on tire pressure systems.
    The agencies proposed that ATIS be the only tire pressure system 
allowed to be used to meet the standards, since TPMS require action on 
the part of the operator. Our position at the time of the proposal was 
that TPMS could not sufficiently guarantee proper inflation. 80 FR 
40262. However, some commenters stated that TPMS are effective in 
encouraging proper tire pressure maintenance, and should also be 
eligible as a compliance option. Commenters did not provide specific 
data about the overall effectiveness of TPMS. However, we are aware of 
the emergence of TPMS that use telematics to automatically report tire 
pressure data to a central contact. It is also our understanding that 
there is a growing recognition among fleet and individual operators of 
the potential value that these systems can provide to operators, so 
long as the operator and/or a central fleet contact take action to 
address cases of low tire pressures indicated by the systems. These 
factors have led the agencies to reconsider our approach to TPMS. As 
described in Section IV.B. above, we now believe that TPMS provides 
overall fuel consumption and CO2 reductions, and the final 
program recognizes the option of TPMS as part of the compliance path 
for all covered trailers.
    NHTSA and EPA recognize the role of proper tire inflation in 
maintaining optimum tire rolling resistance during normal trailer 
operation. Rather than require performance testing of tire pressure 
systems, the agencies recognize the benefits of these systems, and the 
program applies default reduction values for manufacturers that 
incorporate ATIS or TPMS into their trailer designs. Based on 
information available today, we believe that most tire pressure 
technologies and systems in typical use perform similarly.
    We proposed to assign a 1.5 percent reduction in CO2 and 
fuel consumption for all trailers that implement ATIS, based on 
information available at that time.\354\ We did not receive any 
comments directly addressing the proposed reduction value. However, the 
agencies believed it was appropriate to align the effectiveness of tire 
pressure systems for tractors, trailers and vocational vehicles, and 
the agencies are adopting a 1.2 percent reduction for ATIS for each of 
these vehicle categories. As just noted, we are also adopting 
provisions that recognize a CO2 and fuel consumption 
reduction for TPMS. The agencies believe that sufficient incentive 
exists for truck operators to address low tire pressure conditions if 
they are notified that they exist through a TPMS (for example, for 
reasons of personal safety as well as fuel savings). However, we 
recognize the dependence on operator action for TPMS, and we are 
adopting a reduction of 1.0 percent for these systems. We have 
concluded that the use of these systems can consistently ensure that 
tire pressure and tire rolling resistance are maintained. Sections 
III.D.(1)(b) and V.C.(1)(a) also discuss the overall Phase 2 program's 
treatment of both types of tire pressure systems for tractors and 
vocational vehicles, respectively.
---------------------------------------------------------------------------

    \354\ See Chapter 2.10.2.3 of the RIA.
---------------------------------------------------------------------------

    We selected the standards for most box vans with the expectation 
that a high rate of adoption of ATIS will occur during all years of the 
phase-in of the program, and that manufacturers of non-aero vans, and 
non-box trailers will install either TPMS or ATIS, as well as LRR 
tires, to comply with the design-based tire standards.
    In the performance-based compliance approach to full- and partial-
aero box vans, the program incorporates a small discount in the value 
of TPMS in the compliance equation as compared to ATIS, to reflect the 
inherent user interaction required for TPMS to be effective. In the 
design-based compliance approach for non-aero vans and non-box 
trailers, manufacturers may comply by using either TPMS or ATIS, which 
in that case are valued equally. See Section IV.D.(2)(d) below for 
discussion of our estimates of the degree of adoption of tire pressure 
systems prior to and at various points in the phase-in of the proposed 
program.
(d) Weight Reduction
    As proposed, the trailer program provides manufacturers the option 
of complying through the substitution of specified lighter-weight 
components that can be clearly isolated from the trailer as a whole. In 
the proposal, the agencies identified several conventional components 
with lighter-weight substitutes that are currently available (e.g., 
substituting conventional dual tires mounted on steel wheels with wide-
based single tires mounted on aluminum wheels). 80 FR 40262. Several 
commenters provided additional component suggestions, with information 
about their typical associated weight reductions. The component 
substitutions we have included in the final program, and the weight 
savings that we are associating with each component, are presented in 
the RIA Chapter 2.10.2.4 and 40 CFR 1037.515. The agencies have 
identified 12 common trailer components for which lighter weight 
options are currently available (see 40 CFR 
1037.515).355 356 357 358 Manufacturers that adopt these 
technologies and choose to use them as part of their compliance 
strategy sum the associated weight reductions and apply those values in 
the GEM-based compliance equation (see Section IV.E.(2)(a)). We believe 
that the initial cost of these component substitutions is currently 
substantial enough that only a relatively small segment of the industry 
has adopted these technologies today.
---------------------------------------------------------------------------

    \355\ Scarcelli, Jamie. ``Fuel Efficiency for Trailers'' 
Presented at ACEEE/ICCT Workshop: Emerging Technologies for Heavy-
Duty Vehicle Fuel Efficiency, Wabash National Corporation. July 22, 
2014.
    \356\ ``Weight Reduction: A Glance at Clean Freight 
Strategies,'' EPA SmartWay. EPA420F09-043. Available at: http://permanent.access.gpo.gov/gpo38937/EPA420F09-043.pdf.
    \357\ Memorandum dated June 2015 regarding confidential weight 
reduction information obtained during SBREFA Panel. Docket EPA-HQ-
OAR-2014-0827.
    \358\ Randall Scheps, Aluminum Association, ``The Aluminum 
Advantage: Exploring Commercial Vehicles Applications,'' presented 
in Ann Arbor, Michigan, June 18, 2009.
---------------------------------------------------------------------------

    There is no clear ``baseline'' for current trailer weight against 
which lower-weight designs could be compared for regulatory purposes. 
For this reason, the agencies do not believe it is appropriate or fair 
across the industry to apply overall weight reductions toward 
compliance using a universal baseline trailer. However, the agencies do 
believe it is appropriate to give a manufacturer credit for overall 
weight reduction achieved in their own product line. In the final 
program, we are clarifying that manufacturers of box trailers with 
significant weight reductions have the option of using our off-cycle 
credit process to compare overall weight reduction of future trailers 
using an appropriate baseline from their own production. This process 
allows manufacturers to do a comparison of their new trailer to a 
previous model to quantify the weight reduction improvements. 
Manufacturers wishing to go this route should contact

[[Page 73654]]

EPA in advance to discuss appropriate test procedures. More information 
about the off-cycle process can be found in Section IV.E.(5)(d) and in 
40 CFR 1037.610 or 49 CFR 535.7. Note that non-box trailers and non-
aero box vans have design standards that are limited to adoption of 
lower rolling resistance tires and tire pressure systems, and do not 
include weight reduction as part of their simplified compliance 
demonstration.
    The agencies recognize that when weight reduction is applied to a 
trailer, some operators will replace that saved weight with additional 
payload. To account for this in the average vehicle represented by 
EPA's GEM vehicle simulation tool, it is assumed that one-third of any 
weight reduction will be applied to the payload. Wabash suggested that 
the agencies reconsider the distribution of weight between payload and 
trailer weight when modeling weight reduction, expressing concern that 
the reduction was not receiving appropriate credit in the program. 
Although the simulated vehicle in GEM only receives \2/3\ of the weight 
reduction applied, the model calculates CO2 emissions and 
fuel consumption on a per-ton-mile basis by dividing by the payload, 
which now includes the extra one-third from weight reduction. Dividing 
by a larger payload results in lower CO2 and fuel 
consumption values.\359\
---------------------------------------------------------------------------

    \359\ Memorandum to Docket EPA-HQ-OAR-2014-0827, ``Evaluation of 
Weight Reduction Distribution in Response to Public Comments from 
Wabash National Corporation,'' June 18, 2016.
---------------------------------------------------------------------------

    For 53-foot vans simulated in GEM (and thus, for the GEM-based 
equation), it takes a weight reduction of nearly 1,000 pounds before a 
one percent fuel savings is achieved. The impact of the same 1000 
pounds is slightly greater for shorter vans, due to their lower overall 
weight, but the effectiveness of weight reduction is still relatively 
low compared to the effectiveness of many aerodynamic technologies. In 
addition, large material substitutions can be costly. The agencies thus 
believe that few trailer manufacturers will apply weight reduction 
solely as a means of achieving reduced fuel consumption and 
CO2 emissions. Therefore, we are adopting standards that 
could be met without reducing weight--that is, the feasible compliance 
path set out by the agencies for this program does not assume weight 
reduction as a compliance avenue. However, as discussed here, the final 
program includes the option for box trailer manufacturers to apply 
weight reduction to some of their trailers as part of their compliance 
strategy.
(2) Effectiveness, Adoption Rates, and Costs of Technologies for the 
Trailer Standards
    The agencies evaluated the technologies above as they apply to each 
of the trailer subcategories. The next sections describe the 
effectiveness, adoption rates and costs associated with these 
technologies. The effectiveness and adoption rate projections were used 
to derive these standards.
(a) No-Control Default Tractor-Trailer Vehicles in GEM (Box Van 
Standards Only)
    The regulatory purpose of EPA's heavy-duty vehicle compliance tool, 
GEM, is to combine the effects of trailer technologies through 
simulation so that they can be expressed as g/ton-mile and gal/1000 
ton-mile and thus avoid the need for direct testing of each trailer 
being certified. All of the standards for box vans (with the exception 
of non-aero box vans, which have design standards) use an equation 
derived from GEM to demonstrate compliance. The trailer program has 
separate performance standards for each box van subcategory (again, 
with the exception of non-aero box vans) and each of these 
subcategories is modeled as a tractor-trailer combination that we 
believe reflects the average physical characteristics and use pattern 
of vans in that subcategory. Long vans are pulled by sleeper cab 
tractors and use the long-haul drive cycle weightings. Short vans are 
pulled by day cabs and have the short-haul drive cycle weightings. 
Short vans also have a lighter payload and overall vehicle weight 
compared to their longer counterparts.
    Table IV-8 highlights the relevant vehicle characteristics for the 
no-control default of each subcategory (i.e., zero CO2- or 
fuel consumption reducing technologies installed). Baseline trailer 
tires are used, and the drag area, which is a function of the 
aerodynamic characteristics of both the tractor and trailer, is set to 
the values shown previously in Table IV-6. Weight reduction and tire 
pressure systems are not applied in these default vehicles. Chapter 
2.10 of the RIA provides a detailed description of the development of 
these default tractor-trailers. Note that the agencies proposed to use 
Class 8 tractors for all default tractor-trailer vehicles. However, we 
are adopting the final standards based on 4x2 Class 7 tractors for 
short box vans.

              Table IV-8--Characteristics of the No-Control Default Tractor-Trailer Vehicles in GEM
----------------------------------------------------------------------------------------------------------------
                                                  Dry van                            Refrigerated van
----------------------------------------------------------------------------------------------------------------
         Trailer length                  Long                Short               Long                Short
----------------------------------------------------------------------------------------------------------------
Standard Tractor:
    Class.......................  Class 8...........  Class 7...........  Class 8...........  Class 7.
    Cab Type....................  Sleeper...........  Day...............  Sleeper...........  Day.
    Roof Height.................  High..............  High..............  High..............  High.
    Axle Configuration..........  6 x 4.............  4 x 2.............  6 x 4.............  4 x 2.
    Engine......................  2018 MY 15L, 455    2018 MY 11L, 350    2018 MY 15L, 455    2018 MY 11L, 350
                                   HP.                 HP.                 HP.                 HP.
    Steer Tire RR (kg/ton)......  6.54..............  6.54..............  6.54..............  6.54.
    Drive Tire RR (kg/ton)......  6.92..............  6.92..............  6.92..............  6.92.
    Drag Area, CdA (m\2\).......  6.0...............  5.6...............  6.0...............  5.6.
    Number of Trailer Axles.....  2.................  1.................  2.................  1.
    Trailer Tire RR (kg/ton)....  6.00..............  6.00..............  6.00..............  6.00.
    Total Weight (kg)...........  31978.............  18306.............  33778.............  20106.
    Payload (tons)..............  19................  10................  19................  10.
    Tire Pressure System Use....  0.................  0.................  0.................  0.
    Weight Reduction (lb).......  0.................  0.................  0.................  0.
Drive Cycle Weightings:
    65-MPH Cruise...............  86%...............  64%...............  86%...............  64%.
    55-MPH Cruise...............  9%................  17%...............  9%................  17%.

[[Page 73655]]

 
    Transient Driving...........  5%................  19%...............  5%................  19%.
----------------------------------------------------------------------------------------------------------------

(b) Effectiveness of Technologies
    As already noted, the agencies recognize trailer improvements via 
four performance parameters: Aerodynamic drag reduction, tire rolling 
resistance reduction, the adoption of tire pressure systems, and 
weight-reducing strategies. Table IV-9 summarizes the performance 
levels the agencies evaluated for each of these parameters based on the 
technology characteristics outlined in Section IV.D.(1).

       Table IV-9--Performance Parameters for the Trailer Program
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Aerodynamics (Delta CdA, m\2\):
    Bin I..............................  0.0.
    Bin II.............................  0.1.
    Bin III............................  0.4.
    Bin IV.............................  0.7.
    Bin V..............................  1.0.
    Bin VI.............................  1.4.
    Bin VII............................  1.8.
Tire Rolling Resistance (CRR, kg/ton):
    Tire Level 1.......................  6.5.
    Tire Level 2.......................  6.0.
    Tire Level 3.......................  5.1.
    Tire Level 4.......................  4.7.
Tire Inflation System (% reduction):
    ATIS...............................  1.2.
    TPMS...............................  1.0.
Weight Reduction (lb):
    Weight.............................  1/3 added to payload, remaining
                                          reduces overall vehicle
                                          weight.
------------------------------------------------------------------------

    These performance parameters have different effects on each trailer 
subcategory due to differences in the simulated trailer 
characteristics. Table IV-10 shows the agencies' estimates of the 
effectiveness of each parameter for the four box van types. Each 
technology was evaluated using the baseline parameter values for the 
other technology categories. For example, each aerodynamic bin was 
evaluated using the baseline tire (6.0 kg/ton) and the baseline weight 
reduction option (zero pounds). The table shows that aerodynamic 
improvements offer the largest potential for CO2 emissions 
and fuel consumption reductions, making them relatively effective 
technologies.

            Table IV-10--Effectiveness (Percent CO[ihel2] Emissions and Fuel Consumption) of Technologies for Box Vans in the Trailer Program
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                      Dry van                    Refrigerated van
                       Aerodynamics                               Delta CdA (m\2\)       ---------------------------------------------------------------
                                                                                             Long  (%)      Short  (%)       Long  (%)      Short  (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin I.....................................................                           0.0               0               0               0               0
Bin II....................................................                           0.1               1               1               1               1
Bin III...................................................                           0.4               3               3               3               3
Bin IV....................................................                           0.7               5               5               5               5
Bin V.....................................................                           1.0               7               7               7               7
Bin VI....................................................                           1.4               9              10               9              10
Bin VII...................................................                           1.8              12              13              12              13
--------------------------------------------------------------------------------------------------------------------------------------------------------
                  Tire Rolling Resistance                           CRR (kg/ton)                      Dry van
                                                                          Refrigerated van
                                                                                         ---------------------------------------------------------------
                                                                                               Long            Short           Long            Short
--------------------------------------------------------------------------------------------------------------------------------------------------------
Level 1...................................................                           6.5  ..............  ..............  ..............  ..............
Level 2...................................................                           6.0               0               0               0               0
Level 3...................................................                           5.1              -2              -1              -2              -1
Level 4...................................................                           4.7              -3              -2              -3              -2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                     Weight Reduction                                Weight (lb)                      Dry van
                                                                          Refrigerated van
                                                                                         ---------------------------------------------------------------
                                                                                               Long            Short           Long            Short
--------------------------------------------------------------------------------------------------------------------------------------------------------
Baseline..................................................                             0               0               0               0               0

[[Page 73656]]

 
Option 1..................................................                           100               0               0               0               0
Option 2..................................................                           500               1               1               1               1
Option 3..................................................                          1000               1               2               1               2
Option 4..................................................                          2000               2               4               2               4
--------------------------------------------------------------------------------------------------------------------------------------------------------

(c) Baseline Tractor-Trailer To Evaluate Benefits and Costs
    In order to evaluate the benefits and costs of the final standards 
for each of the ten subcategories, it is necessary to establish a 
reference point for comparison. As mentioned previously, the 
technologies described in Section IV.D.(1) exist in the market today, 
and their adoption is driven by available fuel savings as well as by 
the voluntary SmartWay Partnership and California's tractor-trailer 
requirements. For these rules, the agencies identified baseline 
tractor-trailers for each trailer subcategory based on the technology 
adoption rates we project would exist in MY 2018 if this trailer 
program was not implemented.
    CARB's comments noted the informal survey of TTMA members provided 
in letter from TTMA to EPA in 2014 regarding current adoption rates of 
several technologies. CARB suggested that our proposed baseline 
adoption rates did not reflect the data in that letter.\360\ We have 
reassessed available data and we believe that higher baseline rates are 
more appropriate, and have made corresponding changes in our analysis. 
First, we created a separate baseline for box vans that qualify as 
full-aero, box vans that qualify as partial-aero, and box vans that 
qualify as non-aero. Because of the challenges of installing effective 
aerodynamic devices, market forces are not likely to significantly 
drive adoption of CO2- and fuel-consumption reducing 
technologies for trailers with work performing equipment (e.g., lift 
gates), and we are projecting zero adoption of the technologies in the 
baselines for partial- and non-aero box vans before the start of this 
program. Similarly, we assume that there will be zero adoption of these 
technologies for non-box trailers in the baseline. We updated the 
baseline tire rolling resistance level for non-box trailers to reflect 
the lower 6.5 kg/ton value in response to RMA's comment that these 
trailers have different operational characteristics and should not have 
the same baseline tires as box vans (see Section IV.D.(1)(b) above).
---------------------------------------------------------------------------

    \360\ Letter, Truck Trailer Manufacturers Association to EPA. 
Received on October 16, 2014. Docket EPA-HQ-OAR-2014-0827-0146.
---------------------------------------------------------------------------

    TTMA's survey indicated that 35 percent of long vans and less than 
2 percent of vans under 53-foot in length include aerodynamic devices, 
and over 80 percent have adopted lower rolling resistance tires. The 
agencies believe the trailers for which manufacturers have adopted 
these technologies are likely to be trailers that would qualify as 
``full-aero'' vans, and we adjusted our baselines to reflect these 
values. Our baseline assumes that aerodynamics would increase to 40 
percent adoption for full-aero long vans (dry and refrigerated) and 5 
percent for full-aero short vans by 2018 without the Phase 2 standards. 
We also assume adoption of lower rolling resistance tires (Level 1) 
will increase to 90 percent and ATIS to 45 percent in the baseline. We 
held these adoption rates constant throughout the timeframe of the 
rules. Table IV-11 summarizes the updated baseline trailers for each 
trailer subcategory.

 Table IV-11--Estimated Adoption Rates and Average Performance Parameters for the Flat Baseline Trailers for MY
                                                 2018 and Later
----------------------------------------------------------------------------------------------------------------
                                                                           All partial-aero,      All non-box
           Technology                  Long vans          Short vans         non-aero vans         trailers
----------------------------------------------------------------------------------------------------------------
Aerodynamics:
    Bin I.......................                 55%                 95%                100%                100%
    Bin II......................  ..................                  5%
    Bin III.....................                 40%
    Bin IV......................                  5%
    Bin V.......................
    Bin VI......................
    Bin VII.....................
        Average Delta CdA (m2)                   0.2                 0.0                 0.0                 0.0
         \a\....................
Tire Rolling Resistance:
    Level 1.....................  ..................  ..................  ..................                100%
    Level 2.....................                 10%                 10%                100%
    Level 3.....................                 90%                 90%
    Level 4.....................
        Average CRR (kg/ton) \a\                 5.2                 5.2                 6.0                 6.5
Tire Pressure Systems:
    ATIS........................                 45%                 30%
    TPMS........................
        Average Pressure System                 0.5%                0.3%                0.0%                0.0%
         Reduction (%) \a\......
Weight Reduction:

[[Page 73657]]

 
        Weight (lb) \b\.........
----------------------------------------------------------------------------------------------------------------
Notes:
A blank cell indicates a zero value.
\a\ Combines adoption rates with performance levels shown in Table IV-9.
\b\ Weight reduction was not projected for the baseline trailers.

    Also shown in Table IV-11 are average aerodynamic performance 
(delta CdA), average tire rolling resistance 
(CRR), and average reductions due to use of tire pressure 
systems and weight reduction for each reference trailer. These values 
indicate the performance of theoretical average tractor-trailers that 
the agencies project would be in use in 2018 if no federal regulations 
were in place for trailer CO2 and fuel consumption. The 
average tractor-trailer vehicles serve as baselines for each trailer 
subcategory.
    Because the agencies cannot be certain about future trends, we also 
considered a second baseline. This dynamic baseline reflects the 
possibility that, absent a Phase 2 regulation, there would be 
continuing adoption of aerodynamic technologies in the long box trailer 
market after 2018 that reduce fuel consumption and CO2 
emissions. This case assumes the research funded and conducted by the 
federal government, industry, academia and other organizations would, 
after 2018, result in the adoption of additional aerodynamic 
technologies beyond the levels required to comply with existing 
regulatory and voluntary programs. One example of such research is the 
Department of Energy SuperTruck program which has a goal of 
demonstrating cost-effective measures to improve the efficiency of 
Class 8 long-haul freight trucks by 50 percent by 2015.\361\ This 
baseline assumes that by 2040, 75 percent of new full-aero long vans 
would be equipped with SmartWay-verified aerodynamic devices. The 
agencies project that the lower rolling resistance tires and ATIS 
adoption would remain constant. Table IV-12 shows the agencies' 
projected adoption rates of technologies in the dynamic baseline.
---------------------------------------------------------------------------

    \361\ Daimler Truck North America. SuperTruck Program Vehicle 
Project Review. June 19, 2014. Docket EPA-HQ-OAR-2014-0827.

 Table IV-12--Projected Adoption Rates and Average Performance Parameters for the Dynamic Baseline for Long Dry
                                              and Refrigerated Vans
                                [All other trailers are the same as Table IV-11]
----------------------------------------------------------------------------------------------------------------
           Technology                                        Long dry and refrigerated
----------------------------------------------------------------------------------------------------------------
           Model year                  2018            2021            2024            2027            2040
----------------------------------------------------------------------------------------------------------------
Aerodynamics:
    Bin I.......................             55%             50%             45%             40%             20%
    Bin II......................
    Bin III.....................             40%             45%             50%             55%             75%
    Bin IV......................              5%              5%              5%              5%              5%
    Bin V.......................
    Bin VI......................
    Bin VII.....................
        Average Delta CdA (m\2\)             0.2             0.3             0.3             0.3             0.4
         \a\....................
Tire Rolling Resistance:
    Level 1.....................
    Level 2.....................             10%             10%             10%             10%             10%
    Level 3.....................             90%             90%             90%             90%             90%
    Level 4.....................
        Average CRR (kg/ton) \a\             5.2             5.2             5.2             5.2             5.2
Tire Pressure Systems:
    ATIS........................             45%             45%             45%             45%             45%
    TPMS........................
        Average Pressure System             0.5%            0.5%            0.5%            0.5%            0.5%
         Reduction (%) \a\......
Weight Reduction (lbs):
        Weight \b\..............
----------------------------------------------------------------------------------------------------------------
Notes:
A blank cell indicates a zero value.
\a\ Combines adoption rates with performance levels shown in Table IV-9.
\b\ Weight reduction was not projected for the baseline trailers.

    The agencies applied the vehicle attributes from Table IV-8 and the 
average performance values from Table IV-11 in the Phase 2 GEM vehicle 
simulation to calculate the CO2 emissions and fuel 
consumption performance of the baseline tractor-trailers. The results 
of these simulations are shown in Table IV-13. We used

[[Page 73658]]

these CO2 and fuel consumption values to calculate the 
relative improvements that will occur over time with a regulatory 
program. Note that the large difference between the per ton-mile values 
for long and short trailers is due primarily to the large difference in 
assumed payload (19 tons compared to 10 tons) and the small difference 
between dry and refrigerated vans of the same length are due to 
differences in vehicle weight because of the 1800 pounds added to the 
simulated refrigerated vans to account for the TRU (see the vehicle 
characteristics of the simulated tractor-trailers Table IV-8). The 
alternative baseline shown in Table IV-12 mainly impacts the long-term 
projections of benefits beyond 2027, which are analyzed in Chapters 5-7 
of the RIA.

                             Table IV-13--CO[ihel2] Emissions and Fuel Consumption Results for the Baseline Tractor-Trailers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Full-aero  dry van         Full-aero         Partial-aero  dry       Partial-aero
---------------------------------------------------------------------------------------   refrigerated van             van            refrigerated van
                                                                                       -----------------------------------------------------------------
                             Length                                  Long      Short       Long      Short       Long      Short       Long      Short
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO[ihel2] Emissions (g/ton-mile)................................       83.2      126.5       84.9      130.3       86.1      128.5       87.9      132.4
Fuel Consumption (gal/1000 ton-miles)...........................    8.17289   12.42633    8.33988   12.79961    8.45776   12.62279    8.63458   13.00589
--------------------------------------------------------------------------------------------------------------------------------------------------------

(d) Projected Technology Adoption Rates for the Trailer Standards
    The agencies developed their performance and design standards based 
on projected adoption rates of certain technologies. This section 
describes how these adoption rates were applied for each of the trailer 
subcategories.
(i) Aerodynamic and Tire Technologies for Full- and Partial-Aero Box 
Vans
    As described in Section 0, the agencies evaluated several 
alternatives for the trailer program. Based on our analysis and 
comments received, the agencies are adopting standards consistent with 
the agencies' respective statutory authorities. The agencies proposed 
alternatives that were based on the use of averaging and the technology 
adoption rates for those alternatives at proposal reflected the use of 
averaging. As noted in Section IV.B., we received nearly unanimous, 
persuasive comments from the trailer industry opposing averaging and 
the agencies reconsidered the use of averaging in the early years of 
the program. The agencies designed the trailer program to have no 
averaging in MY 2018 through MY 2026. In those years, all box vans sold 
must meet the standards using any combination of available 
technologies. In MY 2027, when the trailer manufacturers are more 
comfortable with compliance and the industry is more familiar with the 
technologies, trailer manufacturers will have the option to use 
averaging to meet the standards. See Section IV.E.(5)(b) below for 
additional information about averaging.
    Table IV-14 and Table IV-15 present sets of assumed adoption rates 
for aerodynamic, tire, and tire pressure technologies that a 
manufacturer could apply to meet the box van standards. Since averaging 
would not be allowed for MY 2018-MY 2026, the adoption rates consist of 
the combination of a single aerodynamic bin (not reflecting any 
averaging of aerodynamic controls), tire rolling resistance level, and 
tire pressure system. As mentioned previously, manufacturers can choose 
other combinations to meet the standards. Chapter 2.10 of the RIA shows 
several examples of alternative compliance pathways.
    The adoption rates in Table IV-14 begin with all full-aero long box 
vans achieving current SmartWay-level aerodynamics (Bin III) in MY 2018 
with a stepwise progression to achieving Bin V in 2024. The adoption 
rates for full-aero short box vans in Table IV-15 assume no adoption of 
aerodynamic devices in MY 2018, adoption of single aero devices in MY 
2021, and combinations of devices by MY 2024. Although the shorter 
lengths of these trailers can restrict the design of aerodynamic 
technologies that fully match the SmartWay-like performance levels of 
long boxes, we nevertheless expect that trailer and device 
manufacturers will continue to innovate skirt, under-body, rear, and 
gap-reducing devices and combinations to achieve improved aerodynamic 
performance on these shorter trailers.
    The adoption rates in MY 2018-MY 2026 are projected to be 100 
percent for each technology, instead of an industry average seen in 
other vehicle sectors in the Phase 2 program. Since we are not 
considering averaging during those years, each set of adoption rates is 
one example of how an individual trailer in each subcategory could 
comply. Through MY 2026, the standards are based on technologies that 
exist today. We evaluated one technology in our aerodynamic test 
programs that met Bin VI levels of performance for long vans, 
suggesting that this bin can be met with combinations of existing 
aerodynamic technologies, but none of our tested technologies that met 
Bin IV levels of performance for short vans. We could not justify 
standards based on 100 percent adoption of those levels of performance 
as a final step in our progression of stringency. However, the industry 
has made great progress toward improving trailer aerodynamics in recent 
years and are continuing to optimize these technologies. Although we 
are not projecting fundamentally new technologies for trailers, we do 
believe aerodynamic performance will evolve in the trailer industry as 
a result of this rulemaking. Based on the recent rate of improvement, 
the agencies believe that there is ample lead time to optimize 
additional existing Bin V and Bin III combinations such that they can 
also meet Bins VI and IV by MY 2027 and it is reasonable to project 
that more than half of these full-aero capable trailers will have 
aerodynamic improvements greater than what is possible with today's 
technologies. Our projected aerodynamic improvements in MYs 2027 and 
later reflect this performance potential.
    The MY 2027 full-aero box van standards are based on an averaging 
program.\362\ We cannot predict what technologies or trailer designs 
may be adapted to meet this level of aerodynamic performance, but an 
averaging program incentivizes manufacturers to develop advanced 
designs with the benefit that not all trailers in their production have 
to meet the same level of performance. The gradual increase in assumed 
adoption of aerodynamic technologies throughout the phase-in to the MY 
2027 standards recognizes that even though many of the technologies are 
available today and technologically feasible throughout the phase-in 
period, adoption of more advanced technologies will likely take time. 
The adoption rates we are

[[Page 73659]]

projecting in the interim years and the standards that we developed 
from these rates represent steady and reasonable improvement in 
aerodynamic performance.
---------------------------------------------------------------------------

    \362\ No averaging is allowed for partial-aero box van reduced 
standards, or the design-based standards for non-aero box vans and 
non-box trailers.
---------------------------------------------------------------------------

    We expect manufacturers of all box vans will adopt tires such as 
SmartWay-verified trailer tires (Level 3) to meet the standards in MY 
2018 and will adopt tires with even lower rolling resistance tires 
(represented as Level 4) as they become available by MY 2021 and later 
years and as fleet experience with these tires develops.
    In establishing standard stringency, the agencies are also assuming 
that all box vans will adopt ATIS throughout the program, though 
manufacturers have the option to install TPMS if they would prefer to 
make up the difference in effectiveness using other technologies. As 
mentioned previously, the agencies did not include weight reduction in 
their technology adoption projections, but certain types of weight 
reduction could be used as part of a compliance pathway, as discussed 
in Section IV.D.(1)(d) IV.D.(1)(d) above.

      Table IV-14--Projected Adoption Rates and Average Performance Parameters for Full-Aero Long Box Vans
----------------------------------------------------------------------------------------------------------------
                   Technology                                    Long box dry & refrigerated vans
----------------------------------------------------------------------------------------------------------------
                   Model year                          2018            2021            2024            2027
----------------------------------------------------------------------------------------------------------------
Aerodynamic Technologies:
    Bin I.......................................
    Bin II......................................
    Bin III.....................................            100%
    Bin IV......................................  ..............            100%
    Bin V.......................................  ..............  ..............            100%             30%
    Bin VI......................................  ..............  ..............  ..............             70%
    Bin VII.....................................
        Average Delta CdA (m\2\) \a\............             0.5             0.7             1.0             1.3
Trailer Tire Rolling Resistance:
    Level 1.....................................
    Level 2.....................................  ..............  ..............  ..............              5%
    Level 3.....................................            100%
    Level 4.....................................  ..............            100%            100%             95%
        Average CRR (kg/ton) \a\................             5.1             4.7             4.7             4.8
Tire Pressure Systems:
    ATIS........................................            100%            100%            100%            100%
    TPMS........................................
        Average Pressure System Reduction (%)               1.2%            1.2%            1.2%            1.2%
         \a\....................................
Weight Reduction:
        Weight (lb) \b\.........................
----------------------------------------------------------------------------------------------------------------
Notes:
A blank cell indicates a zero value.
\a\ Combines projected adoption rates with performance levels shown in Table IV-9.
\b\ This set of adoption rates did not apply any assumed weight reduction to meet these standards for these
  trailers.


      Table IV-15--Projected Adoption Rates and Average Performance Parameters for Full-Aero Short Box Vans
----------------------------------------------------------------------------------------------------------------
                   Technology                                    Short box dry & refrigerated vans
----------------------------------------------------------------------------------------------------------------
                   Model year                          2018            2021            2024            2027
----------------------------------------------------------------------------------------------------------------
Aerodynamic Technologies:
    Bin I.......................................
    Bin II......................................  ..............            100%
    Bin III.....................................  ..............  ..............            100%             40%
    Bin IV......................................  ..............  ..............  ..............             60%
    Bin V.......................................
    Bin VI......................................
    Bin VII.....................................
        Average Delta CdA (m\2\) \b\............             0.0             0.1             0.4             0.6
Trailer Tire Rolling Resistance:
    Level 1.....................................
    Level 2.....................................  ..............  ..............  ..............              5%
    Level 3.....................................            100%
    Level 4.....................................  ..............            100%            100%             95%
        Average CRR (kg/ton) \b\................             5.1             4.7             4.7             4.8
Tire Pressure Systems:
    ATIS........................................            100%            100%            100%            100%
    TPMS........................................
        Average Tire Pressure Reduction (%) \c\.            1.2%            1.2%            1.2%            1.2%
Weight Reduction:
        Weight (lb) \b\.........................
----------------------------------------------------------------------------------------------------------------
Notes:
A blank cell indicates a zero value.
\a\ The majority of short box trailers are 28 feet in length. We recognize that they are often operated in
  tandem, which limits the technologies that can be applied (for example, boat tails).
\b\ Combines projected adoption rates with performance levels shown in Table IV-9.

[[Page 73660]]

 
\c\ This set of adoption rates did not apply any assumed weight reduction to meet these standards for these
  trailers.

    The agencies proposed that the partial-aero box vans would track 
with the full-aero van standards until MY 2024. 80 FR 40257. Wabash 
commented that partial-aero box vans should be exempt starting in MY 
2021 since partial-aero vans cannot use multiple devices. The agencies 
reconsidered the proposed partial-aero standards and recognize that it 
would likely be difficult to meet the proposed MY 2024 standards 
without the use of multiple devices and yet partial-aero trailers, by 
definition, are restricted from using multiple devices. For these 
reasons, the agencies redesigned the partial-aero standards, such that 
trailers with qualifying work-performing equipment can meet standards 
that would be achievable with the use of a single aerodynamic device 
throughout the program, similar to the MY 2018 standards. The partial-
aero standards do, however, increase in stringency slightly in MY 2021, 
to reflect the broader use of improved lower rolling resistance tires.

       Table IV-16--Projected Adoption Rates and Average Performance Parameters for Partial-Aero Box Vans
----------------------------------------------------------------------------------------------------------------
                   Technology                       Partial-aero long box vans      Partial-aero short box vans
----------------------------------------------------------------------------------------------------------------
                   Model year                          2018            2021+           2018            2021+
----------------------------------------------------------------------------------------------------------------
Aerodynamic Technologies:
    Bin I.......................................
    Bin II......................................  ..............  ..............  ..............            100%
    Bin III.....................................            100%            100%
    Bin IV......................................
    Bin V.......................................
    Bin VI......................................
    Bin VII.....................................
        Average Delta CdA (m\2\) \b\............             0.5             0.5             0.0             0.1
Trailer Tire Rolling Resistance:
    Level 1.....................................
    Level 2.....................................
    Level 3.....................................            100%  ..............            100%
    Level 4.....................................  ..............            100%  ..............            100%
        Average CRR (kg/ton) \b\................             5.1             4.7             5.1             4.7
Tire Pressure Systems:
    ATIS........................................            100%            100%            100%            100%
    TPMS........................................
        Average Pressure System Reduction (%)               1.2%            1.2%            1.2%            1.2%
         \a\....................................
Weight Reduction:
        Weight (lb) \b\.........................
----------------------------------------------------------------------------------------------------------------
Notes:
A blank cell indicates a zero value.
\a\ Combines projected adoption rates with performance levels shown in Table IV-9.
\b\ This set of adoption rates did not apply weight reduction to meet these standards for these trailers.

    The adoption rates shown in these tables are one set of many 
possible combinations that box trailer manufacturers could apply to 
achieve the same average stringency. If a manufacturer chose these 
adoption rates, a variety of technology options exist within the 
aerodynamic bins, and several models of LRR tires exist for the levels 
shown. Alternatively, technologies from other aero bins and tire levels 
could be used to comply. It should be noted that since the standards 
for box vans are all performance-based, box van manufacturers are not 
limited to specific aerodynamic and tire technologies in their 
compliance choices. Certain types of weight reduction, for example, may 
be used as part of a compliance pathway. See RIA Chapter 2.10.2.4.1 for 
other example compliance pathways that include weight reduction.
    Similar to our analyses of the baseline cases, the agencies derived 
a single set of performance parameters for each subcategory by 
weighting the performance levels included in Table IV-9 by the 
corresponding adoption rates. These performance parameters represent a 
compliant vehicle for each trailer subcategory and are presented as 
average values in the Table IV-14 through Table IV-16.
(ii) Tire Technologies for Non-Aero Box Vans and Non-Box Trailers
    Neither non-aero vans (i.e., those with two or more work-related 
special components), nor non-box trailers are shown in the tables 
above. This is because we are adopting design-based (i.e., technology-
based) standards for these trailers, not performance-based standards. 
Manufacturers of these trailers do not need to use aerodynamic 
technologies, but they need to install the lower rolling resistance 
tires and tire pressure systems established by this program (see 
Section IV.C.(2)). Compared to manufacturers that needed aerodynamic 
technologies to comply, the approach for non-aero box trailers and non-
box trailers results in a significantly lower compliance burden for 
manufacturers by reducing the amount of tracking and eliminating the 
need to calculate a compliance value (see Section IV.E.). The agencies 
are adopting these design standards, which can be assumed to be 100 
percent adoption, in two stages. In MY 2018, the non-box trailer 
standards require manufacturers to use tires meeting a rolling 
resistance of Level 2 or better and to install tire pressure systems. 
In MY 2021, non-box trailers standards require tire pressure systems 
and LRR tires at Level 3 or better. Non-aero box vans, which we believe 
are largely at a baseline rolling resistance Level 2 today, require 
tire pressure monitoring systems with Level 3 tires in MY 2018 and 
Level 4 tires in MY 2021 and later.
    We received comment that manufacturers were concerned about the 
cost and availability of ATIS for the trailer industry. Still, based on 
comments about TPMS and further evaluations by the agencies, we are 
including TPMS as an additional option for tire pressure systems in the 
trailer program, as discussed in Section IV.D.(1)(c) above. Non-aero 
vans and

[[Page 73661]]

non-box trailers are compliant if they have appropriate lower rolling 
resistance tires and either TPMS or ATIS.
(e) Derivation of the Trailer Standards
    The agencies applied the average performance parameters from Table 
IV-14 and Table IV-15 as input values to the GEM vehicle simulation to 
derive the HD Phase 2 fuel consumption and CO2 emissions 
standards for each long and short full-aero box van subcategory. These 
full-aero van standards are shown in Table IV-17. Similarly, the 
average performance parameters from Table IV-16 were used to calculate 
the partial-aero van standards shown in Table IV-18. The design 
standards for non-box trailer and non-aero box van are summarized in 
Table IV-19.
    Over the four stages of the trailer program, the full-aero box vans 
longer than 50 feet are projected to reduce their CO2 
emissions and fuel consumption by two percent, five percent, seven 
percent and nine percent compared to their average baseline cases in 
Table IV-13. Full-aero box vans 50-feet and shorter will achieve 
reductions of one percent, two percent, four percent and six percent 
compared to their average baseline cases. The partial-aero long and 
short box van standards will reduce CO2 and fuel consumption 
by six percent and four percent, respectively, by MY 2021. The tire 
technologies used on non-box and non-aero box trailers are projected to 
provide reductions of two percent in the first stage and three percent 
in MY 2021 and later.

                                  Table IV-17--Standards for Full-Aero Box Vans
----------------------------------------------------------------------------------------------------------------
                                            Subcategory                Dry van              Refrigerated van
             Model year              ---------------------------------------------------------------------------
                                              Length              Long        Short         Long        Short
----------------------------------------------------------------------------------------------------------------
2018-2020...........................  EPA Standard                   81.3        125.4         83.0        129.1
                                       (CO[ihel2] Grams per
                                       Ton-Mile).
                                      Voluntary NHTSA             7.98625     12.31827      8.15324     12.68173
                                       Standard (Gallons per
                                       1,000 Ton-Mile).
2021-2023...........................  EPA Standard                   78.9        123.7         80.6        127.5
                                       (CO[ihel2] Grams per
                                       Ton-Mile).
                                      NHTSA Standard              7.75049     12.15128      7.91749     12.52456
                                       (Gallons per 1,000
                                       Ton-Mile).
2024-2026...........................  EPA Standard                   77.2        120.9         78.9        124.7
                                       (CO[ihel2] Grams per
                                       Ton-Mile).
                                      NHTSA Standard              7.58350     11.87623      7.75049     12.24951
                                       (Gallons per 1,000
                                       Ton-Mile).
2027+...............................  EPA Standard                   75.7        119.4         77.4        123.2
                                       (CO[ihel2] Grams per
                                       Ton-Mile).
                                      NHTSA Standard              7.43615      11.7288      7.60314     12.10216
                                       (Gallons per 1,000
                                       Ton-Mile).
----------------------------------------------------------------------------------------------------------------


                                Table IV-18--Standards for Partial-Aero Box Vans
----------------------------------------------------------------------------------------------------------------
                                            Subcategory                Dry van              Refrigerated van
             Model year              ---------------------------------------------------------------------------
                                              Length              Long        Short         Long        Short
----------------------------------------------------------------------------------------------------------------
2018-2020...........................  EPA Standard                   81.3        125.4         83.0        129.1
                                       (CO[ihel2] Grams per
                                       Ton-Mile).
                                      Voluntary NHTSA             7.98625     12.31827      8.15324     12.68173
                                       Standard (Gallons per
                                       1,000 Ton-Mile).
2021+...............................  EPA Standard                   80.6        123.7         82.3        127.5
                                       (CO[ihel2] Grams per
                                       Ton-Mile).
                                      NHTSA Standard              7.91749     12.15128      8.08448     12.52456
                                       (Gallons per 1,000
                                       Ton-Mile).
----------------------------------------------------------------------------------------------------------------


               Table IV-19--Design-Based Tire Standards for Non-Box Trailers and Non-Aero Box Vans
----------------------------------------------------------------------------------------------------------------
                Model year                       Tire technology          Non-box trailers    Non-aero box vans
----------------------------------------------------------------------------------------------------------------
2018-2020................................  Tire Rolling Resistance                   <=6.0                <=5.1
                                            Level (kg/ton).
                                           Tire Pressure System.......        TPMS or ATIS         TPMS or ATIS
2021+....................................  Tire Rolling Resistance                   <=5.1                <=4.7
                                            Level (kg/ton).
                                           Tire Pressure System.......        TPMS or ATIS         TPMS or ATIS
----------------------------------------------------------------------------------------------------------------

(f) Technology Costs for the Trailer Standards
    The agencies evaluated the incremental technology costs for 53-foot 
dry and refrigerated vans and 28-foot dry vans. (As explained above, we 
believe these length trailers are representative of the majority of 
trailers in the long and short box van subcategories, respectively.) We 
identified costs for each technology package and projected the costs 
for each year of the program. A summary of the technology costs is 
included in Table IV-20 through Table IV-23 for MYs 2018 through 2027, 
with additional details available in the RIA Chapter 2.12. Costs shown 
in the following tables are for the specific model year indicated and 
are incremental to the average baseline costs, which includes some 
level of adoption of these technologies as shown in Table IV-13. 
Therefore, the technology costs in the following tables reflect the 
average cost expected for each of the indicated trailer classes across 
the fleet. Note that these costs do not represent actual costs for the 
individual components because they are relative to the costs of the MY 
2018 baselines which are expected due to market-driven adoption of the 
technologies. For more on the estimated technology costs exclusive of 
adoption rates, refer to Chapter 2.12 of the RIA. These costs include 
indirect costs via markups and reflect lower costs over time due to 
learning impacts. For a description of the markups and learning impacts 
considered in this analysis and how technology costs for other years 
are thereby affected, refer to Chapter 7 of the RIA.

[[Page 73662]]



                                        Table IV-20--Trailer Technology Incremental Costs in the 2018 Model Year
                                                                         [2013$]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             Long vans,               Short vans,
                                                                Long vans,    partial    Short vans,    partial     Long vans,  Short vans,    Non-box
                                                                full aero       aero      full aero       aero       no aero      no aero
--------------------------------------------------------------------------------------------------------------------------------------------------------
Aerodynamics.................................................         $367         $742           $0           $0           $0           $0           $0
Tires........................................................            2           40            1           20           40           20           28
Tire inflation system........................................          347          659          338          494          421          210          421
                                                              ------------------------------------------------------------------------------------------
    Total....................................................          716        1,441          339          514          461          231          448
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                        Table IV-21--Trailer Technology Incremental Costs in the 2021 Model Year
                                                                         [2013$]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             Long vans,               Short vans,
                                                                Long vans,    partial    Short vans,    partial     Long vans,  Short vans,    Non-box
                                                                full aero       aero      full aero       aero       no aero      no aero
--------------------------------------------------------------------------------------------------------------------------------------------------------
Aerodynamics.................................................         $743         $679         $450         $475           $0           $0           $0
Tires........................................................           17           49            9           25           49           25           23
Tire inflation system........................................          321          609          313          457          389          195          389
                                                              ------------------------------------------------------------------------------------------
    Total....................................................        1,081        1,337          772          957          438          219          412
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                        Table IV-22--Trailer Technology Incremental Costs in the 2024 Model Year
                                                                         [2013$]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             Long vans,               Short vans,
                                                                Long vans,    partial    Short vans,    partial     Long vans,  Short vans,    Non-box
                                                                full aero       aero      full aero       aero       no aero      no aero
--------------------------------------------------------------------------------------------------------------------------------------------------------
Aerodynamics.................................................         $899         $645         $879         $451           $0           $0           $0
Tires........................................................           11           48            6           24           48           24           27
Tire inflation system........................................          294          558          286          418          357          178          357
                                                              ------------------------------------------------------------------------------------------
    Total....................................................        1,204        1,251        1,171          894          405          202          383
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                        Table IV-23--Trailer Technology Incremental Costs in the 2027 Model Year
                                                                         [2013$]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             Long vans,               Short vans,
                                                                Long vans,    partial    Short vans,    partial     Long vans,  Short vans,    Non-box
                                                                full aero       aero      full aero       aero       no aero      no aero
--------------------------------------------------------------------------------------------------------------------------------------------------------
Aerodynamics.................................................       $1,069         $623         $921         $436           $0           $0           $0
Tires........................................................           22           44           11           22           44           22           16
Tire inflation system........................................          279          529          272          397          338          169          338
                                                              ------------------------------------------------------------------------------------------
    Total....................................................        1,370        1,196        1,204          855          382          191          354
--------------------------------------------------------------------------------------------------------------------------------------------------------

(3) Consistency of the Trailer Standards With the Agencies' Statutory 
Obligations
    The agencies have determined that the standards presented in the 
Section IV.C.(2), are the maximum feasible and appropriate under the 
agencies' respective authorities, considering lead time, cost, and 
other factors. The agencies' decisions on the stringency and timing of 
the trailer standards focused on available technology and the 
consequent emission reductions and fuel efficiency improvements 
associated with use of the technology, while taking into account the 
circumstances of the trailer manufacturing sector. Trailer 
manufacturers are subject to first-time emission control and fuel 
consumption regulation under the trailer standards. These manufacturers 
are in many cases small businesses, with limited resources to master 
the mechanics of regulatory compliance. Thus, the agencies are 
providing ample and reasonable time for trailer manufacturers to become 
familiar with the requirements and the new compliance regime.
    The stringency of the standard is predicated on more widespread 
deployment of tire technologies that are already in commercial use and 
existing aerodynamic devices combinations that we believe will be 
further optimized in the near-term. The availability, feasibility, and 
level of effectiveness of these technologies are well-documented. In 
developing the standards, we also took into account not just the 
capabilities of the technologies, but also how the use of these 
technologies is likely to expand under the trailer program, considering 
factors like degree of market penetration over time and the effect of 
different operational patterns for different trailer types (Section 
IV.D.(2) above). For example, some commenters point out that trailers 
operating at lower speeds will achieve smaller CO2 and fuel 
consumption reductions than they will at highway speeds. The agencies 
acknowledge this fact, and account for a fraction of trailer operation 
at slower speeds. All long box vans are evaluated with 5 percent of 
their miles at low speed operation and all short vans are evaluated 
with 17 percent low speed miles. While we cannot predict individual 
trailer use, we believe these

[[Page 73663]]

values are a reasonable estimate of an industry average.\363\ Our 
analysis in RIA Chapter 2.10.2.1.1 shows that skirts will provide short 
trailers with at least 1 percent improvement and long trailers with at 
least 4 percent improvement at 55 mph. We expect most trailers spend at 
least some of their miles at 55 mph or faster in use and will gain 
similar benefits during those speeds. We also show that even trailers 
operating under fully transient conditions (combining slower and faster 
operation) will experience a small improvement from use of trailer 
skirts.
---------------------------------------------------------------------------

    \363\ Memorandum to Docket EPA-HQ-OAR-2014-0827, ``Comparison of 
GEM Drive Cycle Weightings and Fleet Data Provided by Utility 
Trailer Manufacturing Co. in Public Comments'', July 2016.
---------------------------------------------------------------------------

    The agencies do not believe that there is any issue of 
technological feasibility of the levels of the standards and the time 
line for implementing them in the final trailer program. The agencies 
considered cost and the sufficiency of lead-time, including lead-time 
not only to deploy technological improvements, but, as just noted, also 
for this industry sector to assimilate for the first time the 
compliance mechanisms of the trailer program.
    The highest cost shown in Table IV-23 is associated with the 
standard for long dry vans. We project that the average cost per 
trailer to meet the MY 2027 standards for these trailers will be about 
$1,400, which is less than 10 percent of the cost of a new dry van 
trailer (estimated to be about $20,000). Other trailer types have lower 
projected technology costs, and many have higher purchase prices. As a 
result, we project that the per-trailer costs for all trailers covered 
in this regulation will be less than 10 percent of the cost of a new 
trailer.
    The agencies regard these costs as reasonable. We project that most 
customers will rapidly recover the initial cost of these technologies 
due to the associated fuel savings, usually in two years. As discussed 
in Section IX.M and RIA Chapter 7.2.4, this payback is for tractors and 
trailers together, and includes both long and short-haul. This payback 
period is generally considered reasonable in the trailer industry for 
investments that reduce fuel consumption.\364\ Although longer paybacks 
will occur for some trailers, we do not project that any trailers will 
achieve lifetime fuel savings less than the cost of the technologies. 
In addition, the agencies estimate the cost per metric ton of 
CO2eq reduction without considering fuel savings to be $36 
for tractor-trailers in 2030 which compares favorably with the levels 
of cost effectiveness the agencies found to be reasonable for light 
duty trucks.\365\
---------------------------------------------------------------------------

    \364\ Roeth, Mike, et al. ``Barriers to Increased Adoption of 
Fuel Efficiency Technologies in Freight Trucking,'' July 2013. 
International Council for Clean Transportation. Available here: 
http://www.theicct.org/sites/default/files/publications/ICCT-NACFE-CSS_Barriers_Report_Final_20130722.pdf.
    \365\ See RIA Chapter 7.2.5 and Memo to Docket ``Tractor-Trailer 
Cost per Ton Values.'' July 2016. EPA-HQ-OAR-2014-0827.
---------------------------------------------------------------------------

    The agencies believe these technologies can be adopted at the 
projected rates within the lead time provided in the trailer program, 
as discussed above in Section IV.C.(4) above.
(4) Alternative Standards and Feasibility That the Agencies Considered
    As discussed in Section X of the NPRM, the agencies evaluated five 
regulatory alternatives representing different levels of stringency for 
the Phase 2 program. See 80 FR 40273. A wide range of stakeholders 
commented on the proposed (Alternative 3) standards and the other 
alternatives that we discussed, and our final standards reflect our 
consideration of all of those comments.
    Comments on our proposed standards (Alternative 3) and the 
alternatives we presented generally fell into three categories: (1) 
Commenters supporting Alternative 1; i.e., generally advocating no 
mandatory standards and a continuation of today's voluntary SmartWay 
regime and; (2) Commenters preferring the proposed Alternative 3 
standards and timeline to the standards of Alternative 4; and (3) 
Commenters supporting the more stringent standards and timeline of 
Alternative 4, Alternative 5, or of other more stringent potential 
programs.
    Commenters including the TTMA, Utility, and Stoughton stated their 
belief that no mandatory standards are necessary; however, they did not 
provide information to show that market forces at work today will 
achieve the clear potential for the industry to reduce CO2 
and fuel consumption in the near- and longer-term future. The agencies 
have concluded that a program involving no or minimal mandatory 
requirements would not be appropriate or meet our statutory 
requirements.
    As discussed previously, the agencies believe that our final 
trailer standards are appropriate under the Clean Air Act and are the 
maximum feasible standards under the EISA. In developing the proposal 
and the final rule, we considered standards that would be more 
stringent or would become effective in an earlier model year than the 
proposed Alternative 3 standards and timeline. Several commenters 
stated that a still more stringent program should be finalized, 
including information about current and potential future trailer 
aerodynamic technologies. Commenters including CARB, NACAA, NRDC, ICCT, 
UCS, and STEMCO supported the standards we presented for Alternative 4 
in the proposal (essentially the pull ahead of the MY 2027 standards) 
in the proposal. In addition, some of the commenters made the 
additional suggestion that the agencies should anticipate that 
manufacturers will incorporate a modest degree of Bin VIII 
technologies--i.e., two bins higher than any performance demonstrated 
in our aerodynamic testing--in the later stages of the program. EDF 
supported a program of even greater stringency, supporting Alternative 
5 standards (advanced aerodynamic technologies on all box vans, 
aerodynamic technologies on some non-box trailers, and tire 
technologies on all non-box trailers) on the Alternative 4 timeline. 
The Center for Biological Diversity (CBD) did not specifically comment 
on the alternatives presented in the proposal, but supported a program 
that would result in significantly more stringent standards (based, for 
example, on integrated tractor and trailer technologies, such as in the 
SuperTruck demonstration program). Great Dane, Wabash, ATA, and the 
International Foodservice Distributors Association expressed concerns 
that a program of the stringency and timeline of Alternative 4 would 
have negative consequences, including requiring trailer manufacturers 
to adopt less-tested technology.
    Where commenters provided relevant data and information, the 
agencies made adjustments to the final program accordingly. For 
example, as noted in Section IV.C.(1) and Section IV.D.(2) previously, 
information from the industry was helpful in the decision to limit the 
non-box trailer program to tanks, flatbeds, and container chassis. 
Also, partially in response to information we received in comments, we 
slightly reduced the proposed stringency for partial-aero vans to 
better reflect their aerodynamic limitations. Also, while not a direct 
change to the stringency of the standards, the program limits averaging 
to the final stage of the program to allow van manufacturers more time 
to become familiar with the compliance processes and the industry to 
gain confidence in the technologies. Overall, the final standards are 
slightly more stringent than proposed, based on

[[Page 73664]]

an expectation of earlier adoption of more efficient lower rolling 
resistance tires for all subcategories, and a strengthened the full-
aero van program that includes greater adoption of advanced 
aerodynamics in the final stage.
    Based on this analysis and as informed by the comments, we believe 
that the final standards in the program, slightly revised from the 
proposed Alternative 3 standards, are appropriate and represent the 
maximum feasible standards. In contrast, we believe that the 
accelerated timeline of Alternative 4 may cause technologies to 
prematurely enter the market, leading to unnecessary costs and 
compliance burdens that would not be appropriate for this newly 
regulated industry. Standards similar to or more stringent than those 
we evaluated for Alternative 5 would require CO2 and fuel 
consumption reductions that may well not be technologically achievable, 
even with fundamental changes to the industry. Nor did the commenters 
present any information as to how advanced aerodynamic technologies 
(Bins VII and VIII) could be developed and reliably brought to market 
at reasonable cost within the lead time of the Phase 2 program. On the 
basis of what we know today, the agencies are unable to show a pathway 
for the industry to achieve such additional improvements, at least 
without the potential for major disruptions to the industry due to 
requiring, for example, fundamental changes to trailer design and 
construction, or impractical levels of tractor-trailer integration.
E. Trailer Standards: Compliance and Flexibilities
    As with other EPA motor vehicle programs, trailer manufacturers 
must annually obtain a certificate of conformity from EPA before 
introducing into commerce new trailers subject to the new trailer 
CO2 and fuel consumption standards. See CAA section 206(a). 
The EPA certification provisions align with provisions that apply to 
the NHTSA trailer program such that this single certification program 
meets the requirements of both agencies.
    The certification process for trailer manufacturers is very similar 
in its basic structure to the process for the other Phase 2 vehicle 
programs, although it has been simplified for trailers. This structure 
involves pre-certification activities, the certification application 
and its approval, and end-of-year reporting.
    In this section, the agencies first describe the general 
certification process and how we developed compliance equations based 
on the GEM vehicle simulation tool, followed by a discussion of the 
specified test procedures for measuring the performance of tires and 
aerodynamic technologies and how manufacturers will apply test results 
toward compliance and certification. The section closes with 
discussions of several other certification and compliance provisions as 
well as provisions to provide manufacturers with compliance 
flexibility.
(1) General Certification Process
    Under the process for certification, manufacturers of all covered 
trailers are required to apply to EPA for certification.\366\ In 
addition, manufacturers of box vans subject to the performance-based 
standards are required to provide aerodynamic performance test data 
(see 40 CFR 1037.205) in their applications. EPA expects to provide 
additional guidance to the regulated industry as the program begins to 
be implemented, including an overview of the regulations, how to 
prepare for compliance, and instructions for registering with the EPA. 
Once a trailer manufacturer is registered with EPA, EPA's Compliance 
Division in the Office of Transportation and Air Quality will assign a 
staff certification representative to the company to help them through 
the compliance process. After this point, manufacturers can arrange to 
meet with the agencies to discuss compliance plans and obtain any 
preliminary approvals (e.g., appropriate test methods) before applying 
for certification.
---------------------------------------------------------------------------

    \366\ As with the other Phase 2 vehicle programs, manufacturers 
submit their applications to EPA, which then shares them with NHTSA. 
Obtaining an approved certificate of conformity from EPA is the 
first step in complying with the NHTSA program.
---------------------------------------------------------------------------

    Trailer manufacturers submit their applications through the EPA 
``Verify'' electronic database, and EPA issues certificates based on 
the information provided. At the end of the model year, trailer 
manufacturers submit an end-of-year report to the agencies to complete 
their annual obligations.
(a) Definition of Model Year
    As mentioned previously, consistent with Clean Air Act 
specifications, EPA's vehicle certification is an annual process. EPA 
CO2 emissions standards start to apply for trailers built on 
or after January 1, 2018, with later standards being introduced by 
model year. Under the Clean Air Act, the term ``model year'' refers to 
a manufacturer's annual production period. Manufacturers may use the 
calendar year as the model year, or may choose a different period of 
production that includes January 1 of that year. Thus, manufacturers 
have the option to choose any year-long period of production that 
begins on or before January 1 of the named model year, but no sooner 
than January 2 of the previous calendar year. For example, at 
certification, a manufacturer could specify the 2021 model year 
production period to be July 1, 2020 through June 30, 2021.
(b) Preliminary Considerations for Compliance
    Before submitting an application for a certificate, a manufacturer 
chooses the technologies they plan to offer their customers, and 
identifies any trailers in their production line that qualify for 
exclusion from the program.\367\ Non-box trailers, which are subject to 
design standards, the manufacturer will need to select which tires and 
tire pressure systems to include and confirm that their tires meet the 
LRR performance standards. For box vans subject to performance 
standards, manufacturers also obtain performance information for these 
technologies at this time, either from supplier data or their own 
testing. Manufacturers that choose to perform aerodynamic or tire 
testing themselves may also need to obtain approval of test methods and 
perform preliminary testing. Trailer manufacturers relying on data from 
a third-party aerodynamic device manufacturer would need to verify that 
these data are approved.
---------------------------------------------------------------------------

    \367\ Trailers that meet the qualifications for exclusion do not 
require a certificate of conformity and manufacturers do not have to 
submit an application to EPA for these trailers.
---------------------------------------------------------------------------

    During this time, the manufacturers also decide the strategy they 
intend to use for compliance by identifying ``families'' for the 
trailers they produce. A family is a grouping of similar products that 
are all subject to the same standard and covered by a single 
certificate. All products in each trailer subcategory are generally 
certified as the same family. That is, long box dry vans, short box dry 
vans, long refrigerated vans, short refrigerated vans, non-box 
trailers, partial-aero vans (long and short box, dry and refrigerated 
vans), and non-aero box vans, are each certified as separate trailer 
families. Manufacturers may combine dissimilar trailers into a single 
vehicle family to reduce the compliance burden as described in 40 CFR 
1037.230(d)(3) and 49 CFR 535.5(e). In general, manufacturers can 
combine trailers that have less stringent standards with more stringent 
standards as long as the combined set of trailers

[[Page 73665]]

meet the more stringent standards. Refrigerated and dry vans of the 
same length can be combined to meet the dry van standards. Short vans 
can combine with long vans, meeting the corresponding long van 
standard. Additionally, non-box trailers can be combined with the non-
aero box vans if the manufacturer would like to meet the more stringent 
non-aero box van design standards with higher-performing tires.
    When no averaging is available (i.e., MY 2018 through MY 2026 for 
full-aero box vans, and all years for remaining trailers), all products 
within a family need to meet or exceed the standards for that trailer 
subcategory (except for any trailers included in the manufacturer's 
allowance for non-complying vehicles (See Section IV.E.(5)(a) below)). 
This is not to say that, for example, every long box dry van model 
needs to have identical technologies like skirts, tires, and tire 
inflation systems, but that every model in that family need to meet the 
standard for that family.
    In MY 2027 and later, full-aero box van manufacturers will still 
generally have one family per subcategory. However, if a full-aero box 
van manufacturer subject to performance standards wishes to utilize the 
averaging provisions, it would need to divide the trailer models in 
each of the van subcategories/families into subfamilies.\368\ Each 
subfamily can be a grouping of box vans that have similar performance 
levels, even if they use different technologies. We refer to the 
performance levels for each subfamily as ``Family Emission Limits'' 
(FELs). A long box dry van manufacturer could choose, for example, to 
create two subfamilies in its long box dry van family. Trailers in one 
of these subfamilies could be allowed to under-comply with the standard 
(e.g., not apply a tire pressure system) as long as the performance of 
the other subfamily over-complies with the standard (e.g., installs 
additional aerodynamic technologies), such that the average of all of 
the subfamilies' FELs met or exceeded the standard for that family on a 
production-weighted basis. Section IV.E.(5)(b) below further discusses 
how the averaging program would function for any such trailer 
subfamilies.
---------------------------------------------------------------------------

    \368\ The program essentially requires that manufacturers equip 
100 percent of their non-box and special purpose box trailers with 
tire pressure systems and tires meeting the specified rolling 
resistance levels. Partial-aero box vans meet a reduced performance 
standard. As a result, averaging provisions do not apply to these 
trailer subcategories.
---------------------------------------------------------------------------

(c) Submitting a Certification Application and Request for a 
Certificate to EPA
    Once the preliminary steps are completed, the manufacturer can 
prepare and submit applications to EPA for certificate of conformity 
for each of its trailer families. The contents of the application are 
specified in 40 CFR 1037.205, though not all items listed in the 
regulation are applicable to each trailer manufacturer.
    For the early years of the program (i.e., MY 2018 through MY 2020), 
the application must specify whether the trailer manufacturer is opting 
into the NHTSA voluntary program to ensure the information is 
transferred between the agencies. Throughout the program, the 
application must include a description of the emission and fuel 
consumption reduction technologies that a manufacturer intends to 
offer. These technologies could include aerodynamic features, LRR tire 
models, tire pressure systems, or components that qualify for weight 
reduction. Basic information about labeling, warranty, and recommended 
maintenance should also be included the application (see Section 
IV.E.(4) for more information on these additional compliance 
provisions).
    The manufacturer also provides a summary of the plans to comply 
with the standard. This information includes a description of the 
trailer family and subfamilies (if applicable) covered by the 
certificate, the technologies that are used for compliance, and 
projected sales of its products. For trailers subject to performance-
based standards (and not those subject to the design-based standards), 
in the earlier stages of the program when averaging is not available 
(or for manufacturers of full-aero vans that do not participate in 
averaging after MY 2026), additional provisions apply. These 
manufacturers will include information on the configuration with the 
worst performance level in terms of CO2 and fuel consumption 
offered in the trailer family. Any of these manufacturers that choose 
to average within their full-aero van families after MY 2026 will 
include performance information for the projected highest production 
trailer configuration, as well as the lowest and the highest performing 
configurations within those families. For all covered trailers, once 
the certification application is accepted, a certificate is issued and 
manufacturers can begin selling their trailers.
(d) End-of-Year Obligations
    After the end of each year, all manufacturers, including those with 
design-based standards, need to submit a report to the agencies 
presenting production-related data for that year (see 40 CFR 1037.250 
and 49 CFR 535.8). In addition, the year's final compliance data (as 
calculated using the compliance equation) for box van manufacturers 
subject to performance-based standards will include both CO2 
emissions and fuel consumption information and actual production 
volumes in order to demonstrate that the trailers met the standards for 
that year.
    In MY 2027 and later, full-aero box van manufacturers that opt to 
participate in the averaging program will submit a second report that 
describes their subfamily FELs and a final calculation of their 
production-weighted average CO2 and fuel consumption. See 40 
CFR 1037.730, 40 CFR 1037.745, and 49 CFR 535.7. All certifying 
manufacturers need to maintain records of all the data and information 
that is required to be supplied to EPA and NHTSA for eight years.
(2) Evaluating Trailer Performance for Compliance
    The agencies believe that this final compliance program for trailer 
manufacturers is straightforward, technically robust, transparent, and 
minimizes administrative burdens on the industry. As described earlier 
in this section and in Chapter 4 of the RIA, GEM is a customized 
vehicle simulation model that EPA developed for the Phase 1 program to 
relate measured aerodynamic and tire performance values, as well as 
other parameters, to CO2 and fuel consumption without 
performing full-vehicle testing. As with the Phase 1 and Phase 2 
tractor and vocational vehicle programs, the trailer program uses GEM 
in evaluating emissions and fuel consumption in developing the trailer 
standards. However, unlike the tractor and vocational vehicle programs, 
trailer manufacturers will not use GEM directly to demonstrate 
compliance with the trailer standards. Instead, we have developed an 
equation based on GEM that calculates CO2 and fuel 
consumption from performance inputs without running the model.
(a) Development of the GEM-Based Trailer Compliance Equation
    For compliance with the performance-based standards in the trailer 
program (i.e. the standards for full- and partial-aero long and short 
box vans), the trailer characteristics that a manufacturer supplies to 
the equation are aerodynamic improvements (i.e., the change in the 
aerodynamic drag area,

[[Page 73666]]

delta CdA, from the appropriate bin in m\2\), tire rolling 
resistance (i.e., coefficient of rolling resistance, CRR, in 
kg/metric ton), the presence of a tire pressure system, and any weight 
reduction applied in pounds. The use of the equation quantifies the 
overall performance of the trailer in terms of CO2 emissions 
on a grams per ton-mile basis, which can be converted to fuel 
consumption on a gallons per 1000 ton-mile basis.
    Chapter 2.10.5 of the RIA provides a full a description of the 
development and evaluation of the equation for trailer compliance where 
the standards are performance-based. Equation IV-1 is a single linear 
regression curve that can be used for all box vans in these rules to 
calculate CO2 emissions, eCO2. Unique constant 
values, C1 through C4, are applied for each of 
the van types as shown in Table IV-24. Constant C5 is equal 
to 0.988 for any trailer that installs an ATIS (accounting for the 1.2 
percent reduction given for use of ATI), 0.990 for any trailer that 
installs a TPMS, or 1.0 for trailers without tire pressure systems. We 
found that this equation accurately reproduces the results of GEM for 
each of the box van subcategories, and the program requires these 
trailer manufacturers use Equation IV-1 to calculate CO2 for 
compliance. Manufacturers insert their tire rolling resistance level 
(TRRL), wind-averaged change in drag area ([Delta]CdA), 
weight reduction value (WR) (if applicable), and the appropriate 
C5 value if a tire pressure system is installed into the 
equation and submit the result to EPA. The program provides for 
manufacturers to use a conversion of 10.180 grams of CO2 per 
gallon of diesel to calculate the corresponding fuel consumption values 
for compliance with NHTSA's regulations. See 40 CFR 1037.515 and 49 CFR 
535.6.
[GRAPHIC] [TIFF OMITTED] TR25OC16.009


                                            Table IV-24--Constants for GEM-Based Trailer Compliance Equation
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                        C[ihel5] (tire pressure)
             Trailer  subcategory                  C[ihel1]        C[ihel2]        C[ihel3]        C[ihel4]    -----------------------------------------
                                                                                                                    None          TPMS          ATIS
--------------------------------------------------------------------------------------------------------------------------------------------------------
Long Dry Van..................................            76.1            1.67           -5.82        -0.00103        1.000         0.990         0.988
Long Refrigerated Van.........................            77.4            1.75           -5.78        -0.00103
Short Dry Van.................................           117.8            1.78           -9.48        -0.00258
Short Refrigerated Van........................           121.1            1.88           -9.36        -0.00264
--------------------------------------------------------------------------------------------------------------------------------------------------------

    These long and short van constants are based on GEM-simulated 
tractors pulling 53-foot and solo 28-foot trailers, respectively. As a 
result, aerodynamic testing to obtain a trailer's performance 
parameters for Equation IV-1 must be performed using consistent trailer 
sizes (i.e., aerodynamic performance for all lengths of short vans 
would be tested as a solo 28-foot van, and performance for all lengths 
of long vans would be tested as a 53-foot van). More information about 
aerodynamic testing is provided in Section IV.E.(3)(b) below.
    The constants for long vans apply for all dry or refrigerated vans 
longer than 50-feet and the constants for short vans apply for all dry 
or refrigerated vans 50-feet and shorter. The vans with work-performing 
devices that may be designated as partial-aero vans would use the same 
equation constants as their full-aero counterparts for compliance. The 
partial-aero designation simply allows a van to input different values 
(i.e., lower delta CdA) and meet a different standard. Note 
that compliance with the design-based standards (non-box trailers and 
non-aero vans) does not require use of the GEM-based equation. 
Manufacturers supply the TRRL values for their trailer tires and attest 
that they installed one of the tire pressure systems (TPMS or ATIS) to 
EPA for compliance.
(b) Use of the Compliance Equation for Box Van Compliance
    Box van manufacturers subject to the performance-based standards 
meet the standards using the GEM-based compliance equation to combine 
the effects of technologies and quantify the overall performance of the 
vehicle to demonstrate compliance. Trailer manufacturers obtain delta 
CdA and tire rolling resistance values from testing (either 
from their own testing or from testing performed by another entity as 
described in Section IV.E.(3)(b)) and attest that they installed a 
qualifying tire pressure system and/or adopted weight reduction 
strategies. Manufacturers adopting aerodynamic improvements will 
compare their measured delta CdA value to the values shown 
in Table 2 of 40 CFR 1037.515 (and Table IV-5 previously) and use the 
appropriate aerodynamic bin value as the aerodynamic input into the 
equation. The TRRL can be directly applied from measurements. Weight 
reduction is obtained by summing applicable values in our list of light 
weight components (Table 3 of 40 CFR 1037.515) or from measurements 
using the off-cycle provisions. Manufacturers indicate use of TPMS or 
ATIS with a specified percent reduction in CO2 and fuel 
consumption.
    Qualifying components for weight reduction can be found in 40 CFR 
1037.515(d). Manufacturers that substitute one or more of these 
components on their box vans sum the weight reductions assigned to each 
component and enter that total into the equation. As noted in Section 
IV.D.(1)(d), the equation accounts for weight reduction by assigning 
one-third of that reduced weight to increase the payload and the 
remaining weight reduction to reduce the overall weight of the assumed 
vehicle.
    Manufacturers of box vans subject to the performance standards 
apply the compliance equation separately to each configuration to 
ensure that all of the trailer configurations they offer need to meet 
the standard for the given model year. The certification application 
submitted to EPA includes equation results from the worst performing 
trailer configuration for each subcategory and the manufacturer attests 
that no regulated trailer will be sold in a lower performing 
configuration. If the manufacturer offers a new technology package 
during the model year, the performance can be evaluated using the 
equation. If the performance of the new package is lower than the value 
submitted in the application, the manufacturer would submit a ``running 
change'' to EPA to reflect the change. Box van manufacturers will 
submit a single end-of-year report that will include their production 
volumes and

[[Page 73667]]

confirmation that all of their trailers applied the technology packages 
outlined in their application.
    Any full-aero box van manufacturers that wish to take advantage of 
the agencies' averaging provision in MY 2027 and later will make 
greater use of the compliance equation. Before submitting a certificate 
application, these manufacturers would decide which technologies to 
make available for their customers and use the equation to determine 
the range of performance of the packages they planned to offer. The 
manufacturers would supply these results from the equation in their 
certificate application and those manufacturers that wish to perform 
averaging would continue to calculate emissions (and fuel consumption) 
with the equation throughout the model year and keep records of the 
results for each trailer package produced. As described in Section 
IV.E.(1)(d) above, at the end of the year, these manufacturers would 
submit two reports. One report would include their production volumes 
for each configuration. The second report would summarize the families 
and subfamilies, and CO2 emissions and fuel consumption 
results from the equation for all of the trailer configurations they 
build in that model year, including a production-weighted average to 
show compliance.
    For non-box trailers and non-aero box vans, compliance is design-
based, not performance-based, and the compliance equation is not 
needed. As described earlier, the standards for these trailers require 
the use of tires with rolling resistance levels at or below a 
threshold, and tire pressure systems (either TPMS or ATIS). Instead of 
aerodynamic testing data in their certification applications, 
manufacturers of these trailers submit their tire rolling resistance 
levels and a description of their tire pressure system(s) to EPA.
(3) Trailer Certification Test Protocols
    The Clean Air Act specifies that compliance with emission standards 
for motor vehicles be demonstrated by the manufacturer using emission 
test data (see CAA section 206(a) and (b)). As discussed earlier, for 
the design-based standards (non-box trailers and non-aero vans), the 
trailer program considers the use of specified LRR tires and tire 
pressure systems an appropriate surrogate for emission testing, and 
there are no testing requirements associated with these standards 
beyond the testing required to show the tires qualify as LRR tires. We 
expect that tire testing will be performed by the tire manufacturers.
    All full- and partial-aero vans covered by the program are subject 
to performance standards, and compliance is based on measured emission 
performance. For these trailers, the program uses the GEM-based 
compliance equation discussed in Section IV.E.(2)(a) above as the 
official ``test procedure'' for quantifying CO2 and fuel 
consumption performance for trailer compliance and certification (as 
opposed to use of GEM, which serves this function in the tractor and 
vocational vehicle programs). Manufacturers input performance 
information from the applicable trailer technologies into the equation 
in order to calculate their impact on overall trailer performance. 
Manufacturers needing aerodynamic and tire rolling resistance 
performance data obtain it either through their own testing or through 
a device or tire manufacturer that performed the testing. The program 
specifies pre-determined values for tire pressure systems and many 
weight reduction components for manufacturers to apply.
    The following subsections describe the approved performance tests 
for tire rolling resistance and aerodynamic drag in this trailer 
program. See 40 CFR part 1037, subpart F, for a full description of the 
performance tests, in particular section 40 CFR 1037.515.
(a) Trailer Tire Performance Testing
    Under Phase 1, tractor and vocational chassis manufacturers are 
required to input the tire rolling resistance level (TRRL) into GEM, 
and the agencies adopted the provisions in ISO 28580:2009(E) \369\ to 
determine the rolling resistance of tires. The tire rolling resistance 
level (TRRL) is a declared value that is based on a measured value. As 
described in 40 CFR 1037.520(c), this measured value, expressed as 
CRR, is required to be the result of measurements of three 
different tires of a given design, giving a total of at least three 
data points. Manufacturers specify a CRR value for GEM that 
is less than or equal to the average of these three results. Tire 
rolling resistance may be determined by either the vehicle or tire 
manufacturer. In the latter case, the tire manufacturer provides a 
signed statement confirming that it conducted testing in accordance 
with this part.
---------------------------------------------------------------------------

    \369\ See http://www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=44770.
---------------------------------------------------------------------------

    The Phase 1 tire testing provisions for rolling resistance apply to 
all of the regulated trailers in the Phase 2 program. In the Phase 2 
program, full- and partial-aero box van manufacturers, subject to the 
trailer performance-based standards, apply their declared TRRL in the 
compliance equation. Non-box trailer and non-aero box vans, subject to 
the design-based standards, simply report the TRRL as part of their 
certification application. Based on the current practice for Phase 1, 
we expect the trailer manufacturers to obtain these data from tire 
manufacturers, but trailer manufacturers have the option to perform 
tire testing themselves.
    The agencies requested comment on adopting a program for tire 
manufacturers similar to the provision described in Section 
IV.E.(3)(b)(v) for aerodynamic device manufacturers, through which tire 
manufacturers would seek preliminary approval of the performance of 
their trailer tires. 80 FR 40278. CARB supported this option and 
further requested that EPA create a public database of the tire rolling 
resistance data submitted to the agency in such preliminary approvals. 
RMA's comments opposed making tire data available to the public without 
first developing a rating system for medium and heavy truck tires. The 
agencies have chosen not to pursue provisions for pre-approved trailer 
tire rolling resistance data or a public database of this information 
in this rulemaking, recognizing the overall unresolved issues relating 
to standard HD truck and trailer testing within the tire industry (as 
discussed in the Tractor section of this Preamble, Section 
III.E(1)(e)). Instead, trailer tire manufacturers provide tire rolling 
resistance values directly to the trailer manufacturers and that 
information is shared with EPA and NHTSA for certification.
(b) Trailer Aerodynamic Performance Testing
    As discussed earlier, manufacturers of trailers subject to 
performance standards (i.e., most box vans), need to provide EPA with 
aerodynamic performance data at the time of certification. The purpose 
of our trailer aerodynamic test procedures is to establish an estimate 
of the aerodynamic drag experienced by a tractor-trailer vehicle in 
real-world operation. We based these procedures on the current tractor 
aerodynamic procedures, including coastdown, wind tunnel, and 
computational fluid dynamics (CFD) modeling. More specifically, the 
tests are conducted according to the same test procedures for tractors 
and trailers, but different provisions apply for the test articles and 
the data analysis. In the tractor program, the resulting CdA 
value represents the absolute aerodynamic drag of a tested tractor 
assumed to be pulling a specified standard trailer. In the trailer 
program,

[[Page 73668]]

the tests measure the difference in CdA value between the 
tested trailer as pulled by a standard tractor and a reference trailer 
pulled by the same standard tractor. In other words, the trailer test 
procedure is intended to measure the aerodynamic improvements rather 
than the absolute aerodynamic performance. The agencies chose to base 
the standards on measurements of aerodynamic improvements in part to 
reflect the market reality that many trailer manufacturers rely on 
manufacturers of bolt-on aerodynamic devices for the improvements 
rather than redesigning their trailer or developing their own 
components.
    To minimize the testing burden, the program specifies that all 
aerodynamic devices for long box vans (i.e., those greater than 50-feet 
in length) be evaluated based on 53-foot box vans, and that devices for 
all trailers 50-feet and shorter be evaluated based on 28-foot box 
vans. In other words, a manufacturer can use test data from a single 
trailer to certify all trailers in the same subcategory. As noted 
previously in Section IV.D.(1) and demonstrated in Chapter 2.10.2.1.2.6 
of the RIA, the performance of aerodynamic devices on these two trailer 
lengths is expected to provide a conservative estimate of the 
performance on the longer trailers within the same length category. We 
believe that this compliance approach effectively represents the 
performance of such devices on the majority of box vans, yet limits the 
number of such vans that a manufacturer needs to track and evaluate.
    The program provides for manufacturers to have flexibility in the 
devices (or packages of devices) they install on box vans with lengths 
that differ from 53-feet or 28-feet. In such situations, a manufacturer 
could use devices that they believe would be more appropriate for the 
length of the trailer they are producing, consistent with good 
engineering judgement. For example, they could test skirts on a 28-foot 
trailer and use longer skirts on 40-foot trailers that they make. No 
additional testing would be required in order to validate the 
appropriateness of using the alternate devices on these trailers.
    The agencies have structured the final regulations to make wind 
tunnel testing the primary method for measuring trailer aerodynamic 
performance. While coastdown testing measures performance of full-scale 
vehicles, which is generally the agencies' preference for performance 
testing, wind tunnel testing achieves similar results in terms of delta 
CdA, with the added benefit of measuring wind-averaged 
values in the same test. In addition, wind tunnel testing is 
inexpensive relative to other aero test methods and does not require as 
much time to complete. Thus, it has generally been the preferred method 
for the trailer industry. Nevertheless, the program provides for 
manufacturers to use coastdown or CFD methods as described below and 
fully in 40 CFR 1037.526(b) and 1037.150(x).
    The agencies considered making coastdown testing the primary test 
method for trailers, as it is for the tractor program. However, the 
delta CdA approach for the trailer aerodynamic program would 
require multiple tests to evaluate most configurations. Coastdown 
testing is a full-scale test method that requires the vehicle, which 
includes the trailer and an appropriately aerodynamic tractor, be 
driven on a road or track that meets specified conditions. An important 
challenge with coastdown testing is that wind and weather restrictions 
can limit the days in which testing can be performed. Additionally, 
coastdown testing has higher natural variability due to environmental 
variability in an uncontrolled system. We have placed an additional 
restriction on the allowable difference in yaw angles for delta 
CdA measurements to reduce this variability (see 40 CFR 
1037.526(a)(2)). However, the combination of our test constraints 
(e.g., restrictions on the wind, temperature, and road conditions), can 
make it challenging to measure a drag difference from two valid 
coastdown tests. These factors would make accurate coastdown testing 
for the trailer program even more time-consuming and expensive relative 
to the tractor program. Accordingly, we decided that wind tunnel 
testing is more appropriate for this newly regulated industry.
    Coastdown testing has two significant advantages over wind tunnel 
testing. First, as a full-scale method, it can be directly applied to 
actual products. Second, full-scale methods may be the only way to 
reliably test small-scale devices that cannot be appropriately scaled 
or recreated in wind tunnel or CFD. Although these advantages justify 
allowing coastdown testing as an alternate method, they do not justify 
the additional costs that would occur if it were specified as the 
primary test method for trailers.
    In making this determination, the agencies were cognizant of the 
limited financial ability of trailer manufacturers (and device 
manufacturers) to absorb testing costs. Unlike the tractor industry, 
most of the manufacturers in the trailer industry are small- to medium-
sized companies. Even the largest trailer manufacturers are much 
smaller than the companies that manufacture tractors. Had we 
established coastdown as the primary method, trailer manufacturers 
would have needed to not only perform extensive coastdown testing to 
show equivalency with their preferred methods, but would have also 
needed to maintain the ability to perform coastdowns on a regular basis 
like tractor manufacturers are required to under Phase 1 and Phase 2, 
including owning or maintaining access to an appropriate test tractor 
or tractors. While this is a manageable burden for the large tractor 
manufacturers, it would have been a substantial burden for trailer 
manufacturers, especially the smaller ones. TTMA commented that any of 
the larger manufacturers in its membership that may do testing would 
prefer wind tunnel or CFD testing to ``contain costs.'' In conjunction 
with the NODA, EPA laid out principles related to aerodynamic testing 
that we intended to follow when applying our compliance oversight to 
trailers.\370\ In particular, we indicated that we intended to rely 
more on our own confirmatory testing, recognizing that both trailer 
manufacturers and device manufacturers have less financial ability to 
perform Selective Enforcement Audit (SEA) testing than do tractor 
manufacturers (see Section IV.E.(4)(f) for more information on SEAs). 
Under the final regulations, the agencies can perform wind tunnel 
testing, but would also retain the right to perform coastdown testing, 
provided we adjusted any coastdown results to account for yaw 
differences. If we conducted confirmatory testing using coastdowns, we 
would also need to perform enough runs to minimize variability between 
the test conditions. Should we measure worse aerodynamic performance 
(after fully adjusting for methodological differences and accounting 
for test-to-test variability), we would require the manufacturer to use 
our test results as the official test results. It is important to 
emphasize that, because confirmatory testing generally occurs before we 
have issued a certificate of conformity and before the manufacturer has 
begun production, there are no penalties or other compliance actions 
that would result from EPA confirmatory testing. Thus, we do not expect 
manufacturers using wind tunnels to have any need to

[[Page 73669]]

separately verify their results using coastdown procedures.
---------------------------------------------------------------------------

    \370\ ``Additional Discussion of Selective Enforcement Audit and 
Confirmatory Testing for Aerodynamic Parameters for Combination 
Tractors and for Trailers,'' February 19, 2015. Docket EPA-HQ-OAR-
2014-0827-1625.
---------------------------------------------------------------------------

    Details of the test procedures can be found in 40 CFR 1037.526 and 
a discussion of EPA's aerodynamic testing program as it relates to the 
trailer program is provided in the RIA Chapter 3.2. The following 
subsections outline the testing requirements for the long term trailer 
program, as well as simpler testing provisions that apply in the nearer 
term.
(i) A to B Testing for Trailer Aerodynamic Performance
    The agencies expect a majority of the aerodynamic improvements for 
trailers will be accomplished by adding bolt-on technologies. As just 
explained above, a key difference between the tractor program and the 
trailer program is that while the tractor test procedures provide a 
direct measurement of an absolute CdA value for each tractor 
model, aerodynamic improvements for trailers are evaluated by measuring 
a change in CdA (delta CdA) relative to a 
baseline without aerodynamic improvements. Specifically, trailer tests 
are performed as ``A to B'' tests, comparing the aerodynamic 
performance of a tractor-trailer without a trailer aerodynamic device 
(or package of devices) to one with the device (or package) installed. 
As noted below, this approach can be applied if changes are made to the 
aerodynamic design of a trailer as well. See RIA Chapter 2.10.2.1.2 for 
more justification for this A to B approach.
    In essence, an A to B test is a pair of tests: one test of a 
baseline tractor-trailer in a ``no-control'' configuration with zero 
trailer aerodynamic improvements (A), and one test that includes the 
aerodynamic improvements to be tested (B). However, because an A test 
relates to a B test only with respect to the test method and the basic 
tractor-trailer vehicle, one A test could be used for many different B 
test configurations. This type of testing results in a delta 
CdA value instead of an absolute CdA value. For 
the trailer program, the vehicle configuration in the A test includes a 
standard tractor that meets specified characteristics (40 CFR 
1037.501(h)), and a baseline trailer with no aerodynamic improvements. 
The entity conducting the testing (e.g., the trailer manufacturer, a 
contractor, or an aerodynamic device manufacturer, as discussed below) 
performs the test for this configuration according to the procedures in 
40 CFR 1037.526 and repeats the test for the B configuration, which 
includes the trailer aerodynamic package/device(s) being tested. The 
delta CdA value for that trailer with that aerodynamic 
improvement is the difference between the CdA values 
obtained in the A and B tests.
    The agencies note that it was relatively straightforward in Phase 1 
to establish a standard trailer with enough specificity to ensure 
consistent testing of tractors, since there are relatively small 
differences in aerodynamic performance of base-model dry box vans. 
However, as discussed in Chapter 2.10 of the RIA, small differences in 
tractor design can have a significant impact on overall tractor-trailer 
aerodynamic performance. An advantage of an A to B test approach for 
trailers is that many of the effects due to differences in tractor 
design are minimized, which allows different models of tractors to be 
used as standard tractors in testing without compromising the 
evaluation of the trailer aerodynamic technology. Thus, the relative 
approach does not require the agencies to precisely specify a standard 
tractor, nor does it require trailer manufacturers to purchase, modify 
or retain a specific tractor model in order to evaluate their trailers.
    In the event that a trailer manufacturer makes major changes to the 
aerodynamic design of its trailer in lieu of installing add-on devices, 
it could use the same baseline trailer for the A configuration as could 
be used for bolt-on features. In both cases, the baseline trailer would 
be a manufacturer's standard box van. Thus, the manufacturer of a 
redesigned trailer would get full credit for any aerodynamic 
improvements it made.
    As discussed in Chapter 2.10 of the RIA, measured drag coefficients 
and drag areas can vary slightly depending on the test method used. In 
general, absolute wind-averaged CdA values measured using 
wind tunnels and CFD tend to be higher than values measured using the 
near-zero yaw coastdown method. The Phase 1 and Phase 2 tractor program 
use coastdown testing as the reference test method, and the agencies 
require tractor manufacturers to perform at least one test using that 
method to establish a correction factor to apply to each of the 
alternative test methods. The proposed trailer regulations referred to 
coastdown as our reference method, although we noted that the size of 
the bins and the use of delta CdA (as opposed to absolute 
values) minimized the significance of variability between test methods. 
80 FR 40280. CARB recommended that we require a reference method in our 
aerodynamic testing, but provided no data to support their 
recommendation.
    As noted already, the agencies have established the wind tunnel 
method as the primary method. Like the tractor program, the allowance 
to use alternate aerodynamic test procedures provides for adjustments 
to make the measurements equivalent to the primary method. This is done 
to ensure that the manufacturer is neither advantaged nor disadvantaged 
by using the alternate method, relative to results they would have 
obtained using the primary method. However, because determining 
equivalency between methods can be burdensome, the agencies are 
adopting in 40 CFR 1037.150(x) an interim allowance to use certain 
specific approximations based on data currently available to us. 
Manufacturers would not be required to justify using these 
approximations or to seek prior approval for them. Nevertheless, in the 
unlikely event that we determine that these approximations overstate 
actual aerodynamic performance for a particular trailer or device, we 
would not allow the manufacturer to use the approximated values for 
certification and they would be required to use other more reasonable 
adjustments.
    Our test results shown in Chapter 2.10 of the RIA, show that wind 
tunnel and CFD produce wind-averaged delta CdA values within 
the same bin for the devices tested. Thus, this interim provision 
allows CFD results to be used without adjustment. Coastdown delta 
CdA results, which are not wind-averaged, may be in the same 
bin, but we note that the tails showed more yaw dependence and 
coastdown tests under-predicted the performance of tails relative to 
wind-averaged methods. We anticipate some additional current and future 
devices may be sensitive to yaw angle, and our interim provision 
accounts for this. Manufacturers that choose to use coastdown testing 
can use their results without adjustment, or, if they suspect their 
device is affected by yaw angle, they can use other testing or 
analytical methods to demonstrate a means of adjusting their near-zero 
yaw results to a wind-averaged equivalent 4.5-degree value. The bin 
values in Section IV.E.(3)(b)(iv), which were updated based on 
additional aerodynamic test data collected between the NPRM and final 
rules, are based on our wind tunnel testing results, though our results 
suggest that most CFD and coastdown results will fit into the same 
bins. See RIA Chapter 2.10.2.1.3.
(ii) Standard Tractor for Aerodynamic Testing in the Trailer Program
    The agencies are adopting a set of characteristics that qualify a 
tractor to be use in trailer aerodynamic compliance testing. EPA's 
trailer testing program investigated the impact of

[[Page 73670]]

tractor aerodynamics on the performance of trailer aerodynamic 
technologies, as mentioned in Chapter 2.10.2.1.2.2 of the RIA. We found 
the A to B test strategy reduces the degree of precision with which the 
standard tractor needs to be specified. Instead of identifying a 
specific make and model of a tractor to be used over the entire 
duration of the program, the agencies identified an appropriate 
aerodynamic performance threshold that maintains a relatively 
consistent level of performance between trailers. Tractors used in 
trailer aerodynamic tests must meet Phase 2 aerodynamic Bin III or 
better tractor requirements. We believe the majority of tractors in the 
U.S. trucking fleet will be Bin III or better in the timeframe of this 
rulemaking, and trailer manufacturers have the option to choose higher-
performing tractors in later years as tractor technology improves. See 
Section III.D.2.c.i. The standard tractor for long-box vans is a Class 
8 high-roof sleeper cab. The standard tractor for short box vans is a 
Class 7 or 8 high roof day cab with a single drive axle (i.e., 4x2 axle 
configuration). Trailer or device manufacturers are free to choose any 
standard tractor that meets these criteria in their aerodynamic 
performance testing. See 40 CFR 1037.501.
    The compliance equation used to determine compliance with the 
trailer standards is based on GEM, so our discussion of the feasibility 
of our standards (Section IV.D.(2)) includes a description of the 
tractor-trailer vehicle used in GEM. The agencies proposed to require 
use of a 6x4 Class 8 sleeper cab for long box van aerodynamic testing, 
and a 6x4 Class 8 day cab for short box van testing. 80 FR 40279. We 
believe Class 8 tractors are more widely available, which will make it 
easier for the trailer industry to obtain a qualified tractor if they 
choose to perform trailer testing. In order to align with the test 
procedures, we also proposed to consistently model a Class 8 tractor 
across all trailer subcategories in GEM. CARB supported the use of 
Class 8 tractors in their comments. However, EPA encountered difficulty 
in meeting the test procedure-specified tractor-trailer gap width when 
using a dual drive axle day cab in one of our short box van wind tunnel 
tests due to the location of the landing gear relative to the kingpin. 
As a result, we are changing the standard tractor specifications for 
aerodynamic testing to require the use of a 4x2 tractor for short 
trailers. While we expect most manufacturers will use tractor-trailer 
models in wind tunnel or CFD testing, we recognize that there are fewer 
4x2 tractors available for full-scale testing, and we are adopting 
provisions that testers can use either a Class 8 or Class 7 day cab 
tractor to address availability concerns. We believe the external 
aerodynamic characteristics of Class 7 and Class 8 day cabs are very 
similar and the engine performance differences between the two tractor 
classes would not impact the aerodynamic performance in terms of delta 
CdA. Note that a Class 7 4x2 day cab tractor is used for all 
short van default tractor-trailer vehicles within GEM and represented 
in the GEM-based equation (see Table IV-8).
    Daimler requested that we choose a single tractor for all trailer 
testing to ensure consistency over time. As stated above, the agencies 
agree that the tractor does have the potential to influence the 
aerodynamic performance of trailers. As discussed above, however, we 
believe that influence is reduced with use of a delta CdA. 
Additionally, we believe it would be a significant burden on the 
trailer industry to require manufacturers and suppliers to acquire a 
specific tractor make and model over the timeframe of the rules. Thus, 
the final trailer program does not require the use of a specific 
tractor make for the Phase 2 trailer program.
(iii) Accounting for Wind Impacts When Measuring Aerodynamic 
Performance
    The agencies proposed to determine the delta CdA for 
trailer aerodynamic performance using the zero-yaw (or head-on wind) 
values from any of the approved test procedures. However, based on 
comments received, we are revising the final program to be based on 
wind-averaged results, similar to the tractor program. The agencies 
recognize the value of wind-averaging to better reflect the performance 
expected in real-world operation, but at the time of proposal, we 
believed the use of a zero-yaw delta CdA would reduce the 
number of tests compared to generating a wind-averaged value from a 
sweep of yaw angles. Additionally, it is relatively straightforward to 
generate wind-averaged CdA values from wind tunnel and CFD, 
but there is a significant increase in test burden to obtain wind-
averaged results from coastdown tests. Our intent was to ensure parity 
between test procedures, such that manufacturers would have the several 
options to test aerodynamic performance.
    The agencies received comment on this issue, in the context of the 
proposed tractor standards, suggesting that the CdA measured 
at a yaw angle of 4.5 degrees is very similar to the wind-averaged 
CdA calculated at 7 degrees/65 MPH. The agencies evaluated 
our own test data using an average of +4.5 degrees and -4.5 degrees to 
minimize the effect of potential facility asymmetry, and found that the 
results were within two percent of the corresponding wind-averaged 
values (See Section III.E.2.a and Chapter 3.2 of the RIA). Adoption of 
this surrogate angle approach reduces the cost of generating a wind-
averaged value from wind tunnel and CFD procedures.\371\ Consequently, 
the tractor program uses an average CdA measured at +4.5 and 
-4.5 degree yaw angles as a surrogate wind-averaged value (see RIA 
Chapter 3.2 for more information). However, it does not address the 
increased burden for conducting coastdown tests.
---------------------------------------------------------------------------

    \371\ CFD test contracts are often priced for individual yaw 
angles. Wind tunnel test contracts are often priced for an entire 
yaw sweep. Limiting our measurement requirement to one or two yaw 
angles is expected to reduce the cost of generating a wind-averaged 
value from CFD, but will only reduce the cost from wind tunnel tests 
if the manufacturer choses to do individual yaw angles in lieu of 
the customary sweep.
---------------------------------------------------------------------------

    The agencies received comment from TTMA that ``repetitive'' 
coastdown testing would rarely be used by its trailer manufacturer 
members. Instead, manufacturers that do choose to perform their own 
testing will likely rely on CFD and wind tunnel tests. Because we are 
establishing the wind tunnel method as the primary method, and because 
we expect it to also be the most commonly used method, we no longer 
have test burden concerns about requiring wind-averaging. Therefore, 
the agencies believe we can adopt aerodynamic test procedures for 
trailers that require wind-averaged delta CdA values, as 
represented by an average of results from +4.5 and -4.5 degree yaw 
angles, for compliance. We believe that coastdown testing will be 
chosen by a small number of manufacturers and the burden of performing 
this optional test on the overall industry will be relatively small. 
EPA may rely on coastdown testing in its own confirmatory testing, and 
the agency will accept the additional burden of correcting to a wind-
averaged value.
(iv) Bins for Aerodynamic Performance
    As mentioned in Section IV.D., the trailer program uses aerodynamic 
bins to account for testing variability and to provide consistency in 
the performance values used for compliance. We developed these bins in 
terms of delta CdA ranges, and we designed them to be broad 
enough to cover the range of uncertainty seen in our aerodynamic 
testing program in terms of test-to-test variability as well as 
variability due to

[[Page 73671]]

differences in test method, tractor models, trailer models and device 
models. The bins are somewhat different than in the proposal, as 
discussed in Section IV.D.(1)(a)(ii) above RIA Chapter 2.10.2.1.3.

   Table IV-25--Aerodynamic Bins Used To Determine Inputs for Trailer
                              Certification
------------------------------------------------------------------------
                                                              Delta CdA
   Delta CdA measured in testing               Bin            input for
                                                              compliance
------------------------------------------------------------------------
<0.1...............................  Bin I.................          0.0
0.10-0.39..........................  Bin II................          0.1
0.40-0.69..........................  Bin III...............          0.4
0.70-0.99..........................  Bin IV................          0.7
1.00-1.39..........................  Bin V.................          1.0
1.40-1.79..........................  Bin VI................          1.4
>=1.8..............................  Bin VII...............          1.8
------------------------------------------------------------------------

    A manufacturer that wishes to perform testing first identifies a 
standard tractor according to 40 CFR 1037.501(h) and a representative 
baseline trailer with no aerodynamic features (or models of these 
vehicles), then performs the A to B tests with and without aerodynamic 
improvements to obtain a delta CdA value. The manufacturer 
uses Table IV-25 to determine the appropriate bin based on their 
measured delta CdA. Each bin has a corresponding delta 
CdA threshold value that is the value manufacturers insert 
into the compliance equation.
(v) Aerodynamic Device Testing Compliance Path
    The agencies recognize that much of the trailer manufacturing 
industry may have little experience with aerodynamic performance 
testing. For this reason, the program includes a compliance option that 
we believe minimizes the testing burden for trailer manufacturers, and 
at the same time meets the requirements of the Clean Air Act and of 
EISA by providing reasonable assurance that the anticipated 
CO2 and fuel consumption benefits of the program will be 
realized in real-world operation. This approach provides an opportunity 
for trailer manufacturers to choose technologies with pre-approved test 
data for installation on their new trailers without performing their 
own aerodynamic testing. We note that this testing option is consistent 
with recommendations of the Small Business Advocacy Review (SBAR) 
Panel, which is summarized in Section XIV.D and Chapter 12 of the RIA.
    The trailer program provides for trailer aerodynamic device 
manufacturers to seek preliminary approval of the performance of their 
devices (or combinations of devices) based on the same performance 
tests described previously. Trailer manufacturers could then choose to 
use these devices and apply the approved performance levels in the 
certification application for their trailer families. A device 
manufacturer would need to perform the required A to B testing using a 
tractor-trailer that meets the requirements specified in 40 CFR 
1037.211 and 1037.526 and submit the performance results, in terms of 
delta CdA, directly to EPA.\372\ EPA would require much of 
the same information from the device manufacturers as it would normally 
require during certification, including the technology name, a 
description of its proper installation procedure, and its corresponding 
delta CdA derived from the approved test procedures. See 40 
CFR 1037.211.
---------------------------------------------------------------------------

    \372\ Note that in the event a device manufacturer submits false 
or inaccurate data to EPA, it could incur liability for causing a 
regulated entity to commit a prohibited act. See 40 CFR 1068.101(c). 
This same potential liability exists with respect to information 
provided by a device manufacturer directly to a trailer 
manufacturer.
---------------------------------------------------------------------------

    Once a device manufacturer has obtained this preliminary approval, 
it could supply the same information to any trailer manufacturers that 
wish to install its devices. When the trailer manufacturer certifies, 
the agencies would merely verify that the values in the trailer 
manufacturer's certification application are those already approved for 
the device manufacturer. To ease the transition for MYs 2018 through 
2020, we proposed and are adopting a flexibility to allow pre-approval 
of certain data accepted by the EPA SmartWay aerodynamic verification 
program. Section IV.E.(5)(c) below describes how a device manufacturer 
can use certain test data generated for SmartWay verification as a part 
of its pre-approval in the early years of the program.
    The program also allows trailer manufacturers to use multiple 
devices with individually pre-approved test data on a single trailer 
configuration, provided each device does not impair the effectiveness 
of the other(s), consistent with good engineering judgment.\373\ 40 CFR 
1037.211 outlines a process for combining the effects of multiple 
devices to determine an appropriate delta CdA value for 
compliance. More specifically, manufacturers would fully count the 
technology with largest delta CdA value, discount the second 
by 10 percent, and discount each of the remaining additional 
technologies by 20 percent. This discounting acknowledges the complex 
interactions that can occur among individual aerodynamic devices and 
provides a conservative value for the impact of the combined devices 
(see the analysis of device combinations in RIA Chapter 2.10). For 
example, a manufacturer applying three separately tested devices with 
delta CdA values of 0.40, 0.30, and 0.10 would calculate the 
combined delta CdA as:
---------------------------------------------------------------------------

    \373\ A trailer manufacturer needs to use good engineering 
judgement (as defined in 40 CFR 1068.5) in combining devices for 
compliance in order to avoid combinations that are not intended to 
work together (e.g., both a side skirt and an under-body device).

---------------------------------------------------------------------------
Delta CdA = 0.40 + 0.90*0.30 + 0.80*0.10 = 0.75 m\2\

    The agencies believe that discounting the delta CdA 
values of individually-tested devices used as a combination provides a 
modest incentive for trailer or device manufacturers to test and get 
EPA pre-approval of the combination as an aerodynamic system for 
compliance. To avoid this discounting, device manufacturers can test a 
trailer incorporating a combination of devices and receive EPA pre-
approval for data from that combination. Trailer manufacturers could 
then use the test results from that specific combination for 
certification.
    Note that the aerodynamic bins of Table IV-25 do not apply to 
aerodynamic data that device manufacturers submit to EPA for pre-
approval. The pre-approved data will have greater precision than the 
bin-averaged values shown in Table IV-25. Therefore, trailer 
manufacturers calculating a delta CdA value based on 
combinations of pre-approved data use the exact numbers submitted by 
the device manufacturers to calculate the discounted delta 
CdA, and thus select an appropriate bin value for compliance 
based on that result. The process to obtain approval is outlined in 40 
CFR 1037.211.
    The agencies note that many of the largest van manufacturers are 
already performing aerodynamic test procedures to some extent, and the 
agencies expect other van manufacturers will increasingly be capable of 
and interested in performing these tests as the program progresses. The 
device testing approach is intended to allow trailer manufacturers to 
focus on and become familiar with the certification process in the 
early years of the program and, if they wish, begin to perform testing 
in the later years, when it may be more appropriate for their 
individual companies. This approach does not preclude trailer 
manufacturers from performing their own testing at any time, even if 
the technologies they wish to install are already pre-approved. For

[[Page 73672]]

example, a manufacturer that believed a specific trailer actually 
performed in a more synergistic manner with a given device than the 
device's pre-approved delta CdA value suggested could 
perform its own testing and submit the results to EPA for 
certification.
    STEMCO, an aerodynamic device manufacturer, commented in support of 
the proposed pre-approval option, but also supported the agencies 
publishing information about the testing performed by device 
manufacturers for their devices to be pre-approved. The agencies are 
not committing to publish the pre-approved aerodynamic data at this 
time. We do note that once data are submitted to EPA and the device is 
introduced into commerce, the data are available to the public at their 
request and the information gathered may be published by outside 
stakeholders.
(4) Additional Certification and Compliance Provisions
(a) Trailer Useful Life
    Section 202(a)(1) of the CAA specifies that EPA is to propose 
emission standards that are applicable for the ``useful life'' of the 
vehicle. NHTSA is adopting EPA's proposed useful life requirements for 
trailers, to ensure that manufacturers consider in their design process 
the need for fuel efficiency standards to apply for the same duration 
as the EPA standards. Based on our own research and discussions with 
trailer manufacturers, EPA and NHTSA are adopting a regulatory useful 
life value for trailers of 10 years, as proposed. This useful life 
value represents the average duration of the initial use of trailers, 
before they are moved into less rigorous duty (e.g., limited use or 
storage). We note that the useful life value is 10 years or a mileage 
threshold for other heavy-duty vehicles. However, unlike for the other 
vehicles, the program does not include a parallel mileage value for 
trailers. This would require odometers on trailers, and we do not 
believe that mandating odometers would be appropriate for this purpose.
    With this useful life provision, trailer manufacturers are 
responsible for designing and building their trailers so that they will 
be able to meet the CO2 emissions and fuel consumption 
standards for 10 years after the trailer is produced, provided that 
they are properly maintained. For technologies at issue here, we 
believe that this requirement is essentially the same as customers' 
existing durability expectations. The useful life requirements do not 
include liability for damage to or removal of devices by users. 
Instead, trailer manufacturers must ensure at the time of sale that 
devices are properly installed and able to maintain functionality 
throughout the useful life. We believe that manufacturers will be able 
to demonstrate at certification that their trailers, including all 
bolt-on technologies used as emissions controls, will comply with the 
CO2 and fuel consumption standards for the useful life of 
the trailers without separate durability testing. The aerodynamic 
technologies that we expect manufacturers to use to comply with the 
trailer standards, including side skirts and boat tails, are designed 
to continue to provide their full potential benefit indefinitely as 
long as no serious damage occurs.
    Regarding a useful life value for trailer tires, we recognize that 
the original lower rolling resistance tires will wear over time and 
will be replaced several times during the useful life of a trailer, 
either with new or retreaded tires. As with the Phase 1 tractor 
program, to help ensure that trailer owners have sufficient knowledge 
of which replacement tires to purchase in order to retain the as-
certified emission and fuel consumption performance of their trailer 
for its useful life, the trailer program requires that trailer 
manufacturers supply adequate information in the owners manual to allow 
the trailer owner to purchase replacement tires meeting or exceeding 
the rolling resistance performance of the original equipment tires. 
(Note that the ``owners manual'' need not be a physical document, but 
could be made available on line). We believe that the favorable fuel 
consumption benefit of continued use of LRR tires generally results in 
proper replacements throughout the 10-year useful life. Finally, the 
program requires that tire pressure systems remain effective for at 
least the 10-year useful life, although some servicing may be necessary 
by the customer. See also the related discussions below in Section 
IV.E.(4)(c) (Emission-Related Warranty) and Section IV.E.(4)(d) 
(Maintenance).
(b) Emission Control Labels
    Historically, EPA-certified vehicles are required to have a 
permanent emission control label affixed to the vehicle. The label 
facilitates identification of the vehicle as a certified vehicle. For 
the trailer program, EPA requires that the labels include the same 
basic information as we require for tractor labels in Phase 1. For 
trailers, this information includes the manufacturer, a trailer 
identifier such as the Vehicle Identification Number, the trailer 
family and regulatory subcategory, the date of manufacture, and 
compliance statements. Although the Phase 2 label for tractors does not 
include emission control system identifiers (as previously required for 
tractors in the Phase 1 program in 40 CFR 1037.135(c)(6)), the trailer 
program requires that these identifiers be included in the trailer 
labels. See 40 CFR 1037.135 for a list of general requirements for 
emissions labels, which includes a reference to Appendix III for 
appropriate abbreviations for trailer technologies.
(c) Emission-Related Warranty
    Section 207 (a) of the CAA requires manufacturers to warrant their 
products to be free from defects that could otherwise cause non-
compliance with emission standards. For purposes of the trailer 
program, EPA requires trailer manufacturers to warrant all components 
that form the basis of the certification to the CO2 emission 
standards. The emission-related warranty covers all aerodynamic 
devices, lower rolling resistance tires, tire pressure systems, and 
other components that may be included in the certification application. 
Note that the emission-related warranty is completely separate from any 
other warranties a manufacturer might offer.
    The trailer manufacturer needs to warrant that these emission-
related components and systems are designed to remain functional for 
the warranty period. We note that this emission-related warranty, and 
the trailer manufacturer's financial responsibility for repairs, does 
not apply to components that are damaged in collisions or through 
abuse; nor does it cover components that experience wear with normal 
use. This warranty is meant to apply to defects in the product or 
improper installation by the manufacturer. Based on the historical 
practice of requiring emissions warranties to apply for half of the 
useful life, we are adopting a warranty period for trailers of five 
years for everything except tires. For trailer tires, we apply a 
warranty period of one year.
    Utility and Great Dane noted in their comments that the warranty of 
current ATIS that they are aware of is limited to three years. However, 
we view this as a business decision by the ATIS manufacturers, rather 
than as a reflection of the actual durability of the systems. With 
proper maintenance, we are aware of no reason that these systems would 
be unable to meet the durability requirements of the trailer program or 
to be designed to last the full useful life of the trailer if properly 
maintained. See the Maintenance

[[Page 73673]]

discussion at IV.E.(4)(d) below. We believe a five year emission-
related warranty is justified, but we note that trailer manufacturers 
can specify that their warranty depends on the proper maintenance of 
components. Manufacturers can offer a more generous warranty if they 
choose; however, the emission-related warranty may not be shorter than 
any other warranty they offer without charge for the trailer. NHTSA is 
not adopting any warranty requirements relating to its trailer fuel 
consumption program.
    At the time of certification, manufacturers need to supply a copy 
of the warranty statement that they supply to the end customer. This 
document outlines what is covered under the GHG emissions related 
warranty as well as the duration of coverage. Customers also need to 
have clear access to the terms of the warranty, the repair network, and 
the process for obtaining warranty service.
(d) Maintenance
    In general, EPA requires that vehicle manufacturers specify 
schedules for any maintenance needed to keep their product in 
compliance with emission standards throughout the useful life of the 
vehicle (CAA section 207(a)). For trailers, such maintenance could 
include adjustments to fairings or service to tire pressure systems. 
EPA believes that any such maintenance is likely to be performed by 
operators to maintain the fuel savings of the components. If 
manufacturers believe that the durability of their trailer's 
performance is contingent on proper maintenance of these systems, they 
must include a corresponding maintenance schedule in their 
certification applications.
    Since lower rolling resistance tires are key emission control 
components under this program, and they will likely require replacement 
at multiple points within the life of a vehicle, it is important to 
clarify how tires fit into the emission-related maintenance 
requirements. Although the agencies encourage the exclusive use of LRR 
tires throughout the life of trailers vehicles, we do not hold trailer 
manufacturers responsible for the actions of end users. We do not see 
this as problematic because, as noted above, we believe that trailer 
end users have a genuine financial motivation for ensuring their 
vehicles are as fuel efficient as possible, which includes purchasing 
LRR replacement tires and that they will continue to use them once they 
are accustomed to their use. Therefore, as mentioned in Section 
IV.E.(4) above, to help ensure that trailer owners have sufficient 
knowledge of which replacement tires to purchase in order to retain the 
as-certified emission and fuel consumption performance of their 
trailer, the program requires that trailer manufacturers supply 
adequate information in the owners manual to allow the trailer owner to 
purchase tires meeting or exceeding the rolling resistance performance 
of the original equipment tires. (As discussed above, note that the 
``owners manual'' need not be a physical document, but could be made 
available on line). Manufacturers submit these instructions to EPA as 
part of the application for certification.
(e) Post-Useful Life Modifications
    The Clean Air Act generally prohibits any person from removing or 
rendering inoperative any emission control device installed for 
compliance, such as those needed to comply with the requirements of 40 
CFR part 1037. However, in 40 CFR 1037.655 EPA clarifies that certain 
vehicle modifications are allowed after a vehicle reaches the end of 
its regulatory useful life. This section applies to trailers, since it 
applies to all vehicles subject to 40 CFR part 1037.
    The provisions of 40 CFR 1037.655 clarify that owners may modify a 
vehicle for the purpose of reducing emissions, provided they have a 
reasonable technical basis for knowing that such modification will not 
increase emissions of any other pollutant, but emphasizes that EPA 
presumes such modifications to be more appropriate for second owners. 
In the case of trailers, an owner would need to have information that 
would lead an engineer or other person familiar with trailer design and 
function to reasonably believe that the modifications will not increase 
emissions of any regulated pollutant. In the absence of such 
information, modifications during or after the trailer's useful life 
would constitute tampering with an emission control system. Thus, this 
provision does not provide a blanket allowance for modifications after 
the useful life.
    This section does not specifically apply with respect to 
modifications that occur within the useful life period, other than to 
note that many such modifications to the vehicle during the useful life 
are presumed to violate CAA section 203(a)(3)(A). EPA notes, however, 
that this is merely a presumption, and would not prohibit modifications 
during the useful life where the owner clearly has a reasonable 
technical basis for knowing the modifications will not cause the 
vehicle to exceed any applicable standard.
(f) Confirmatory Testing and Selective Enforcement Audits (SEA) for GEM 
Inputs
    In Phase 2, vehicle performance for box vans (except non-aero box 
vans) is measured using a GEM-based equation, which accepts input 
parameters related to aerodynamics, tire rolling resistance, and 
trailer weight. Trailer manufacturers are responsible for obtaining 
performance measures for these parameters through valid testing 
according to the specified test procedures. The Clean Air Act 
authorizes EPA to perform its own testing to confirm the manufacturer's 
data. This testing, which is called confirmatory testing, is conducted 
prior to issuing a certificate. The Act also authorizes EPA to require 
manufacturers to conduct Selective Enforcement Audits (SEA), which 
would involve testing performed on production vehicles before they 
enter into commerce.
    The agencies are finalizing a list of lightweight trailer 
components that can be installed by trailer manufacturers and used in 
certification. Additionally, we are assigning a set percent reduction 
value to qualifying tire pressure systems (i.e., ATIS and TPMS) that 
manufacturers can apply if they install these systems. Thus, because 
these are agency-default values rather than the manufacturers' measured 
or declared values, we will not hold trailer manufacturers responsible 
for the accuracy of these values. Additionally, we expect most trailer 
manufacturers will obtain LRR tire information directly from the tire 
manufacturers and many trailer manufacturers will install aerodynamic 
devices with data that was pre-approved by EPA. Information provided by 
a third party (such as a tire or device manufacturer) to a regulated 
entity for compliance is treated as though it was submitted directly to 
EPA. EPA has the authority to verify such data and hold the third party 
responsible for any falsified data, since submission of such data could 
incur liability for causing a regulated entity to commit a prohibited 
act. See 40 CFR 1068.101(c).
    Of all of the performance measures for trailers, we believe 
aerodynamic testing has the greatest potential for variability and 
these results are likely to receive the most scrutiny. In the NPRM, we 
proposed to generally apply the same SEA and confirmatory testing 
structures to tractors and trailer with respect to aerodynamics. 
However, we also proposed to retain the authority to require component 
manufacturers to perform SEAs where certification relies

[[Page 73674]]

on their test data. See, e.g. section 1037.301(d)(4) of the proposed 
regulations.
    We are revising the SEA and confirmatory testing structures for 
trailers based on further consideration and comments received from the 
trailer manufacturing industry (TTMA). In general, the final 
regulations reflect the following principles:
     Due to the smaller number of possible trailer 
configurations (compared to tractor configurations), it would be more 
possible for EPA to rely on confirmatory testing for trailer 
aerodynamics.
     Since test-to-test variability for individual coastdown 
runs can be high, confirmatory test determinations should be based on 
average values from multiple runs.
     Trailer manufacturers and trailer component manufacturers 
have less financial ability to perform SEAs than do tractor 
manufacturers. Nevertheless, EPA should retain the authority to require 
trailer and trailer component manufacturers to perform SEAs, especially 
where EPA has reason to believe the trailers are non-compliant.
     Given the limited ability to eliminate uncertainty, 
compliance determinations should consider the statistical confidence 
that a true value lies outside a bin.
    EPA will generally try to duplicate a manufacturer's test setup in 
any confirmatory testing (which would include the standard tractor) 
unless we have reason to believe an inappropriate setup was used. While 
our test results presented in Chapter 2.10 of the RIA show that the 
trailer program's delta CdA approach reduces the tractor's 
impact on trailer results, to the extent practical, EPA will use the 
same standard tractors that manufacturers used in their testing.
    We believe that, although the final compliance structure for 
trailers is simpler than for tractors, it will still provide a strong 
incentive for manufacturers to act in good faith. In particular, the 
regulations emphasize the final value of EPA's auditing records and 
inspecting production components, rather than requiring manufacturers 
to perform expensive testing. Thus, EPA expects to require 
manufacturers to perform SEA testing only when we have reasonable 
evidence leading us to believe a manufacturer have not provided 
accurate test data. See Section III.E.(2)(a)(ix) for a discussion of 
how EPA would conduct an aerodynamic SEA.
(g) Importation of New Trailers
    Manufacturers have raised concerns about enforcement of emission 
standards for new trailers that are imported into the United States. 
This poses unique challenges at the point of entry, because new 
trailers may be carrying cargo and are therefore nearly 
indistinguishable from trailers that have already been imported or 
otherwise placed into service. We are not adopting any new or different 
compliance provisions in this rulemaking to address this; however, we 
intend to work cooperatively with Customs and Border Protection and 
other agencies to ensure that first-time state registration of new 
trailers includes verification that the trailer manufacturers have 
certified them to meet U.S. emission and fuel consumption standards. We 
expect this to be similar to the current system for ensuring that new, 
imported trailers meet NHTSA safety standards.
    A related concern applies for foreign-based trailers traveling in 
the United States for importing or exporting cargo. Such trailers are 
not subject to emission and fuel consumption standards unless they are 
considered imported into the United States. U.S. cabotage law prohibits 
foreign truck drivers from carrying product from one point to another 
within the United States. Effective enforcement of this cabotage law 
will help prevent manufacturers of noncompliant foreign-produced 
trailers from gaining a competitive advantage over manufacturers of 
compliant domestic trailers.
(5) Flexibilities
    The trailer program that the agencies are adopting incorporates a 
number of provisions that have the effect of providing flexibility and 
easing the compliance burden on trailer manufacturers while maintaining 
the expected CO2 and fuel consumption benefits of the 
program. Among these is the basic approach we used in setting the 
trailer standards, including the staged phase-in of the standards, 
which gradually increase the CO2 and fuel consumption 
reductions that manufacturers need to achieve over time as they also 
increase their experience with the program. As described in Section 
IV.E.(3)(b)(v), another of these is the process for device 
manufacturers to submit test data directly to EPA for review by the 
agencies in advance of formal certification, allowing a trailer 
manufacturer to reduce the amount of testing needed to demonstrate 
compliance or avoid it altogether.
    In addition to these provisions inherent to the trailer program, 
this section describes additional options the agencies are adopting 
that we believe will be valuable to many trailer manufacturers.
(a) Limited Allowance of Non-Complying Trailers
    As described in Section IV.B. above the agencies are not finalizing 
the proposed provisions that would have allowed manufacturers to comply 
with the trailer standards using averaging before MY 2027. As a result, 
in the absence of mitigating provisions, manufacturers would need to 
comply with the applicable standards for all of their trailers. The 
agencies received comment, primarily from trailer manufacturers, that, 
without the flexibility of averaging, trailer manufacturers should be 
allowed to ``carve-out'' a set percentage of their sales that would not 
be required to meet the standards. Stoughton Trailers suggested a 20 
percent carve-out.
    The agencies considered this concept and this final program 
provides each manufacturer with a limited ``allowance'' of trailers 
that do not need to meet the standards. In determining an appropriate 
value for this allowance, the agencies sought to balance the need for 
some degree of flexibility in the absence of averaging while minimizing 
changes in the competitive relationships among larger and smaller 
trailer manufacturers. An allowance of 20 percent, as suggested by 
Stoughton, is problematic, since the annual production for individual 
trailer manufacturers varies so widely. An allowance of 20 percent for 
a very large manufacturer could very well represent the same volume of 
trailers as an entire year's sales for a small manufacturer. This in 
turn could result in a situation where a large number of non-complying 
trailers would be on the market, potentially attracting customers away 
from smaller manufacturers that needed to market complying trailers.
    Because of this, the agencies estimated a representative volume of 
trailers based on the 2015 Trailer Production Figures published by 
Trailer-BodyBuilders.com.\374\ The smallest box van manufacturer in the 
list produced 1800 dry freight vans in 2015. Twenty percent of that 
production is 360 trailers. The agencies are adopting an interim 
provision providing box van manufacturers an allowance of 20 percent of 
their production (up to a maximum of 350 units) that are not

[[Page 73675]]

required to meet the standards for model years 2018 through 2026 when 
we do not include averaging. All lengths of box vans, including both 
dry and refrigerated, produced by a given manufacturer count toward the 
allowance.
---------------------------------------------------------------------------

    \374\ 2015 Trailer Production Figures Table. Schenk, Paul. March 
4, 2016. Accessed January 4, 2016. Available at: http://trailer-bodybuilders.com/trailer-output/2015-trailer-production-figures-table.
---------------------------------------------------------------------------

    While averaging does not apply for partial- and non-aero box 
trailers at any point in the program, the agencies believe 
manufacturers can also benefit from the ability to exempt some trailers 
from these subcategories in the early years as they transition into the 
full program. For MY 2018 through 2026, manufacturers can include 
partial- and non-aero box trailers in their 350 box van allowance. In 
MY 2027, we believe all partial- and non-aero box vans can meet the 
reduced standards for their given subcategories.
    Non-box trailers have design-based tire standards and averaging 
thus does not apply for this subcategory. Similar to the partial- and 
non-aero box vans, we also believe non-box manufacturers can benefit 
from a transitional exemption allowance. The agencies are adopting a 
separate allowance for non-box trailers, because their production 
volumes differ and many non-box trailer manufacturers do not build box 
vans. Using the same trailer production figures, we found that the 
smallest non-box trailer manufacturer in the list produced 1325 
trailers in 2015 and twenty percent of that production is 265 trailers. 
From MY 2018 through 2026, non-box trailer manufacturers can exempt 20 
percent or 250 trailers from the applicable tire standards. By MY 2027, 
we believe all non-box trailers can incorporate the tire technologies 
required by the design standards.
    The agencies estimate that the box van and non-box trailer 
allowances translate on average to less than two percent of production 
across the trailer industry, and the agencies believe that this minor 
degree of loss of emission and fuel consumption reduction benefits is 
more than offset by the flexibility which, as pointed out earlier, may 
be needed by this newly regulated industry segment. These allowances 
are specified in 40 CFR 1037.150 and 49 CFR 535.3.
(b) Averaging Provisions for the Late Years of the Trailer Program
    The agencies proposed to allow trailer manufacturers to use 
averaging throughout the phase-in of the program as one option for 
complying with the trailer standards. As noted, we received nearly 
unanimous comments, in response to the pre-proposal SBREFA panel and to 
the NPRM, from trailer manufacturers opposing averaging. Specifically, 
the commenters cited their concern that the unique aspects of the 
trailer market tend to mean that the value of averaging as a tool is 
less than it has been for manufacturers in other industries, and the 
potential for negative consequences to some manufacturers is 
substantial. The trailer manufacturing industry is very competitive, 
and manufacturers must be highly responsive to their customers' diverse 
demands. Compared to other industry sectors, they can have little 
control over what kinds of trailer models their customers demand and 
thus limited ability to manage the mix and volume of different 
products. Additionally, one of the larger, more diverse manufacturers 
could potentially supply a customer with trailers that had few if any 
aerodynamic features, while offsetting this part of their business with 
over-complying trailers that they were able to sell to another 
customer; many smaller companies with limited product offerings might 
not be able to compete for those customers.
    As a result of the many comments opposing averaging from trailer 
manufacturers--the very stakeholders meant to benefit from an averaging 
program--the agencies have reconsidered how averaging is incorporated 
into the program. The final program does not allow averaging as a 
compliance option in the early years of the program, in MY 2018 through 
MY 2026. In those years, all box vans sold (beyond a manufacturer's 
allowance of non-complying trailers) must meet the standards using any 
combination of available technologies.
    However, the agencies have concluded that by late in the program, 
the value of an averaging option to many trailer manufacturers may well 
outweigh the concerns they have expressed. In addition, the final stage 
of the phase-in of the standards for MY 2027 represents the most 
stringent standards in the program, and additional flexibility may be 
welcome by trailer manufacturers. Therefore, the final program will 
provide a limited optional averaging program for MY 2027 and later 
full-aero box vans. By that time, we believe that the trailer 
manufacturers will be experienced and comfortable with the program, and 
the industry will be more familiar with the technologies.
    The MY 2027 and later averaging provisions are identical in most 
respects to those we proposed for the other Phase 2 vehicle programs. 
One notable difference involves use of credits. As in the proposed 
trailer program, the averaging provisions for trailers focus on each 
individual model year's production. A manufacturer choosing to use the 
averaging provisions could not ``bank'' compliance credits for a future 
model year or ``trade'' (sell) credits to another manufacturer, since 
these provisions would disproportionately benefit the few large trailer 
manufacturers. Under these averaging provisions, a full-aero box van 
manufacturer that produces some MY 2027 or later box vans that perform 
better than required by the applicable standard could produce a number 
of vans in the same family that do not meet the standards, provided 
that the average compliance levels of the trailers it produces in any 
given model year is at or below the applicable standards for that 
family.
    As in the proposed program, averaging is only available for full-
aero box vans. The program is already designed to offer reduced 
standards for box vans designated as partial-aero, and the additional 
flexibility of averaging is not available. Also, averaging is 
inherently incompatible with design standards for non-aero box vans and 
non-box trailers, since those manufacturers cannot choose among 
compliance paths.
    The agencies are adopting averaging sets for full-aero box vans 
based on trailer length. Trailers in a family are certified to a single 
standard, but individual trailers within the family may be grouped to 
certify to a family emissions limit (FEL) that is higher or lower than 
the standard, provided the production-weighted average of all FELs in a 
family can be averaged to the standard or better. By allowing averaging 
sets to include both refrigerated and dry vans similar length 
categories, a manufacturer that over-complies, on average, in one 
family, can use the credits generated toward compliance in the other 
family. For example, if a manufacturer has two subfamilies in each of 
its long dry and long refrigerated van families, and the over-
compliance of one dry van subfamily exceeds the under-compliance of the 
other dry van subfamily, the additional over-compliance beyond the dry 
van family's standard become credits that can be used to offset any 
under-compliance in the refrigerated van family.
    In order to avoid backsliding with the use of averaging, the 
agencies are adopting a provision to require a minimum level of 
technology adoption in MY 2027 and later. No FEL can exceed the MY 2018 
standard for the given trailer subcategory. For example, a manufacturer 
could not over-comply on some trailers and expect to produce a fraction 
of their trailers with zero

[[Page 73676]]

technologies installed; every trailer must, at minimum, include enough 
technologies to meet the corresponding MY 2018 standard. See 40 CFR 
1037.107(a)(5) and 49 CFR 535.5(e).
    As mentioned previously, manufacturers with a trailer family that 
performed better than the standard at the end of the year would not be 
allowed to bank credits for a future model year. However, the agencies 
understand that it is possible for a manufacturer to misjudge 
production and come up short at the end of the model year. In such a 
case, the program provides for a manufacturer to generate a credit 
deficit, if necessary, as a temporary recourse for unexpected 
challenges in a given model year.\375\ The agencies would closely 
monitor the certification applications for the following model year, to 
ensure the manufacturer can make progress in reducing the deficit. Any 
such credit deficits would need to be resolved within the following 
three model years, and the manufacturer would need to generate credits 
from over-compliance in subsequent years to address deficits from prior 
model years. See 40 CFR 1037.745.
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    \375\ Section IV.E.(1)(b) describes the process of identifying 
trailer families and sub-families based on basic trailer 
characteristics. 40 CFR 1037.710 describes the provisions for 
establishing subfamilies within a trailer family and the Family 
Emission Limits that are averaged among the subfamilies.
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    The agencies believe that limiting the availability of averaging 
provisions to the final stage of the program will ease a number of the 
competitive concerns that trailer manufacturers have raised, since the 
trailer program will be familiar and the value of averaging may be 
greater as the most stringent standards phase in. Small business 
manufacturers raised concerns in our pre-proposal small business 
outreach that averaging would disproportionately benefit larger 
manufacturers with larger production volumes and greater product 
diversity. We are limiting our averaging program to single model year 
averaging (i.e., no banking or trading) to help address this concern. 
Similarly, we are adopting a maximum FEL based on the MY 2018 standard 
to ensure that larger manufacturers will not be able to produce large 
volumes of trailers with little or no technologies at the expense of 
manufacturers that cannot accumulate sufficient over-compliance within 
their annual production. To the extent that concerns about the MY 2027 
and later averaging provisions remain as that model year approaches, 
the agencies look forward to working with manufacturers as they 
consider using averaging.
(c) Aerodynamic Device Testing Using SmartWay-Verified Data
    The agencies expect some trailer manufacturers and aerodynamic 
device manufacturers to continue to submit test data to the SmartWay 
program for verification. Since many manufacturers have some experience 
with EPA's SmartWay program, the agencies have designed the trailer 
program and aerodynamic testing to recognize the significant synergy 
with the SmartWay Technology Program. Section IV.E.(3)(b)(v) describes 
the compliance path available to trailer manufacturers to use pre-
approved performance data for aerodynamic devices. As an additional 
interim option, any device manufacturer that attains SmartWay 
verification for a device prior to January 1, 2018 is eligible to 
submit its previous SmartWay-verified data to EPA's Compliance Division 
for pre-approval, provided their test results come from one of 
SmartWay's 2014 test protocols that measure a delta CdA. The 
protocols for coastdown, wind tunnel, and computational fluid dynamics 
analyses result in a CdA value. Note that SmartWay's 2014 
protocols allow SAE J1321 Type 2 track testing, which generates fuel 
consumption results, not CdA values. Two commenters (a 
device manufacturer and an NGO) requested that we allow SAE J1321 track 
test results, but did not suggest a means of converting from the fuel 
consumption results to an appropriate delta CdA value for 
use in compliance. As a result, the agencies will not accept J1321 data 
for pre-approval.
    Beginning on January 1, 2018, EPA will require that device and 
trailer manufacturers that seek approval of new aerodynamic 
technologies for trailer certification use one of the approved test 
methods for Phase 2 (i.e., coastdown, wind tunnel or CFD) and the test 
procedures found in 40 CFR 1037.526. Aerodynamic technologies that were 
pre-approved using performance data from SmartWay's 2014 Protocols will 
maintain their approved status through December 31, 2020. Beginning 
January 1, 2021, all pre-approval of device performance will need to be 
based on testing using the Phase 2 test procedures.
(d) Off-Cycle Technologies
    The Phase 1 and Phase 2 programs include provisions for 
manufacturers to request the use of off-cycle technologies that are not 
recognized in GEM and were not in common use before MY 2010. During the 
development of the trailer proposal, the agencies were not aware of any 
technologies that could improve CO2 and fuel consumption 
performance that would not be captured in the trailer test protocols, 
and we did not propose a process to evaluate off-cycle trailer 
technologies. We continue to believe that effective trailer aerodynamic 
technologies that would not be captured by the test protocols are 
unlikely to emerge. However, Wabash provided comments requesting a 
process for evaluating future trailer weight reduction options. They 
suggested that these options could include lightweight components that 
are not listed in our regulations as approved material substitution 
components, or overall trailer weight reduction strategies that are not 
limited to individual components.
    In light of these comments and further consideration of the issue, 
the agencies believe that the off-cycle technology process is an 
appropriate way for certain box van manufacturers--that is, those using 
the compliance equation and not subject to the design standards--to 
receive credit for future lightweighting or other technologies that are 
not recognized in the compliance equation. For this reason, we have 
incorporated box vans into the existing off-cycle provisions. In the 
case of lightweighting, a measured difference in trailer weight could 
substitute for the weight component of the compliance equation. For 
other such technologies (should any exist), the general off-cycle 
provisions apply. See 40 CFR 1037.515(e).
(e) Small Business Regulatory Flexibility Provisions
    As a part of our small business obligations under the Regulatory 
Flexibility Act, EPA and NHTSA have considered additional flexibility 
provisions aimed at this segment of the trailer manufacturing industry. 
EPA convened a Small Business Advocacy Review (SBAR) Panel as required 
by the Small Business Regulatory Enforcement Fairness Act (SBREFA), and 
much of the information gained and recommendations provided by this 
process form the basis of the proposed flexibilities.\376\ As in 
previous rulemakings, our justification for including provisions 
specific to small businesses is that these entities generally have a 
greater degree of difficulty in complying with the

[[Page 73677]]

standards compared to other entities. Thus, as discussed below, we are 
adopting several regulatory flexibility provisions for small trailer 
manufacturers that we believe will reduce the burden on them while 
achieving the goals of the program.
---------------------------------------------------------------------------

    \376\ Additional information regarding the findings and 
recommendations of the Panel are available in Section XIV, Chapter 
12 of the RIA, and in the Panel's final report titled ``Final Report 
of the Small Business Advocacy Review Panel on EPA's Planned 
Proposed Rule: Greenhouse Gas Emissions and Fuel Efficiency 
Standards for Medium- and Heavy-Duty Engines and Vehicles: Phase 2'' 
(See Docket EPA-HQ-OAR-2014-0827).
---------------------------------------------------------------------------

    The agencies identified 178 trailer and tank manufacturers for our 
analysis and we believe 147 qualify as small business (i.e., less than 
1000 employees).\377\ The agencies designed many of the program 
elements and flexibility provisions available to all trailer 
manufacturers with the large fraction of small business trailer 
manufacturers in mind. For the small van manufacturers, we believe the 
option to choose pre-approved aerodynamic data will significantly 
reduce the compliance burden and eliminate the requirement for all 
manufacturers to perform testing. We are also limiting the final non-
box trailer program to tanks, flatbeds, and container chassis. All 
other non-box trailers are exempt from the Phase 2 trailer program, 
with no regulatory requirements. This exemption reduces the number of 
small businesses in the trailer program from 147 to 74 companies at the 
time of the development of this rulemaking. With no regulatory 
requirements, these companies have zero burden under the trailer 
program. We are also adopting the proposed design standards for the 
remaining non-box trailers, such that they can certify by installing 
tire technologies only, with no testing requirements. The agencies are 
also adopting provisions that would increase the number of eligible 
tire pressure systems that can be installed for compliance. In addition 
to ATIS, TPMS is a recognized technology in the final rulemaking. 
Furthermore, the non-box trailers, which have design-based tire 
standards, comply if they have either a TPMS or an ATIS, and 
appropriate lower rolling resistance tires. The inclusion of the less 
expensive TPMS as a tire pressure system option will improve the 
availability of technologies and reduce the technology cost for many 
small businesses.
---------------------------------------------------------------------------

    \377\ In the period between the SBAR Panel and Initial 
Regulatory Flexibility Analysis and issuing of the final rule, the 
Small Business Administration (SBA) finalized new size standards for 
small business classification. For trailers, the threshold to 
qualify as small changed from 500 employees to 1000 employees. We 
have updated our analysis to reflect the new size standards.
---------------------------------------------------------------------------

    As noted above, the small trailer manufacturers raised concerns 
that their businesses could be harmed by provisions allowing averaging, 
banking, and trading of emissions and fuel consumption performance, 
since they will not be able to generate the same volume of credits as 
large manufacturers. The agencies are not adopting banking and trading 
provisions in any part of the program, and are limiting the option to 
average to manufacturers of full-aero dry and refrigerated box trailers 
and delaying the averaging until MY 2027. Similarly, we are adopting a 
maximum FEL based on the MY 2018 standard to ensure that larger 
manufacturers will not be able to produce large volumes of trailers 
with little or no technologies at the expense of manufacturers that 
cannot accumulate sufficient over-compliance within their annual 
production. We expect that the familiarity of the industry, including 
small business manufacturers, with the trailer program by this stage of 
the program, and the requirement that all trailers meet at least the MY 
2018 level of control, will reduce the concerns of small manufacturer 
compared to an earlier or broader averaging program.
    For all small business trailer manufacturers, the agencies are 
adopting a one-year delay in the beginning of implementation of the 
program, until MY 2019. We believe that this allows small businesses 
additional needed lead time to make the necessary staffing adjustments 
and process changes, and possibly add new infrastructure to meet the 
requirements of the program. TTMA commented that all trailer 
manufacturers are ``small businesses'' relative to other heavy-duty 
industries and that the one-year delay would divert sales to small 
businesses for that model year. Wabash argued that providing a 
flexibility is not required by the RFA and not authorized by the Clean 
Air Act. The agencies believe that small businesses do not have the 
same resources available to become familiar with the regulations, make 
process and staffing changings, or evaluate and market new technologies 
as their larger counterparts. We believe a one-year delay provides 
additional time for small businesses to address these issues, without a 
large CO2 and fuel consumption impact or substantial 
negative competitive effects. The cumulative annual production of all 
of the small business box trailer manufacturers is estimated to be less 
than 15 percent of the industry's total production, which is 
significantly less than the annual production of the four largest 
manufacturers.\378\ We expect any diverted sales for this one year will 
be a small fraction of the large manufacturers' production and we are 
finalizing the one-year delay for all small business trailer 
manufacturers.
---------------------------------------------------------------------------

    \378\ See Figure 1-3 of Chapter 1 in the RIA comparing the 2015 
trailer output from the top 28 trailer manufacturers.
---------------------------------------------------------------------------

    Chapter 12 of the RIA presents the agencies' Final Regulatory 
Flexibility Analysis. In this chapter, we discuss the recommendations 
of the Panel, what we proposed, and what we finalized for the small 
businesses regulated in Phase 2. We also estimate the economic effect 
of the rulemaking on these businesses based on their annual revenue. 
Considering the flexibilities adopted in this rulemaking, our estimate 
of compliance burden indicates that only 15 of the 147 small trailer 
manufacturers (about 10 percent) will have an economic impact greater 
than one percent of their annual revenue. Therefore, we believe the 
trailer provisions in this rulemaking do not have a significant impact 
on small businesses.

V. Class 2b-8 Vocational Vehicles

A. Summary of Phase 1 Vocational Vehicle Standards

    Class 2b-8 vocational vehicles include a wide variety of vehicle 
types, and serve a wide range of functions. Some examples include 
service for urban delivery, refuse hauling, utility service, dump, 
concrete mixing, transit service, shuttle service, school bus, 
emergency, motor homes, and tow trucks. In the HD Phase 1 Program, the 
agencies defined Class 2b-8 vocational vehicles as all heavy-duty 
vehicles that are not included in the Heavy-duty Pickup Truck and Van 
or the Class 7 and 8 Tractor categories. In effect, the rules classify 
heavy-duty vehicles that are not a combination tractor or a pickup 
truck or van as vocational vehicles. Class 2b-8 vocational vehicles and 
their engines emit approximately 17 percent of the GHG emissions and 
burn approximately 17 percent of the fuel consumed by today's heavy-
duty truck sector.\379\
---------------------------------------------------------------------------

    \379\ Memorandum to the Docket ``Runspecs, Model Inputs, MOVES 
Code and Database for HD GHG Phase 2 FRM Emissions Modeling.''. July 
2016. See also EPA's MOVES Web page at https://www3.epa.gov/otaq/models/moves/index.htm.
---------------------------------------------------------------------------

    Most vocational vehicles are produced in a two-stage build process, 
though some are built from the ``ground up'' by a single entity. In the 
two-stage process, the first stage sometimes is completed by a chassis 
manufacturer that also builds its own proprietary components such as 
engines or transmissions. This is known as a vertically integrated 
manufacturer. The first stage can also be completed by a chassis 
manufacturer who procures all

[[Page 73678]]

components, including the engine and transmission, from separate 
suppliers. The product completed at the first stage is generally either 
a stripped chassis, a cowled chassis, or a cab chassis. A stripped 
chassis may include a steering column, a cowled chassis may include a 
hood and dashboard, and a cab chassis may include an enclosed driver 
compartment. Many of the same companies that build Class 7 and 8 
tractors also sell vocational chassis in the medium heavy- and heavy 
heavy-duty weight classes. Similarly, some of the companies that build 
Class 2b and 3 pickups and vans also sell vocational chassis in the 
light heavy-duty weight classes.
    The second stage is typically completed by a final stage 
manufacturer or body builder, which installs the primary load carrying 
device or other work-related equipment, such as a dump bed, delivery 
box, or utility boom. There are over 200 final stage manufacturers in 
the U.S., most of which are small businesses. Even the large final 
stage manufacturers are specialized, producing a narrow range of 
vehicle body types. These businesses also tend to be small volume 
producers. In 2011, the top four producers of truck bodies sold a total 
of 64,000 units, which is about 31 percent of sales in that year.\380\ 
In that same year, 74 percent of final stage manufacturers produced 
less than 500 units.
---------------------------------------------------------------------------

    \380\ Specialty Transportation.net, 2012. Truck Body 
Manufacturing in North America.
---------------------------------------------------------------------------

    The businesses that act both as the chassis manufacturer and the 
final stage manufacturer are those that build the vehicles from the 
``ground up.'' These entities generally produce custom products that 
are sold in lower volumes than those produced in large commercial 
processes. Examples of vehicles produced with this build process 
include fire apparatus and transit buses.
    The diversity in the vocational vehicle segment can be primarily 
attributed to the variety of customer needs for specialized vehicle 
bodies and added equipment, rather than to the chassis. For example, a 
body builder can build either a Class 6 bucket truck or a Class 6 
delivery truck from the same Class 6 chassis. The aerodynamic 
difference between these two vehicles due to their bodies leads to 
different in-use fuel consumption and GHG emissions. However, the 
baseline fuel consumption and emissions due to the components included 
in the common chassis (such as the engine, drivetrain, frame, and 
tires) may be the same between these two types of vehicles.
    Owners of vocational vehicles that are upfitted with high-priced 
bodies that are purpose-built for particular applications tend to keep 
them longer, on average, than owners of vehicles such as pickups, vans, 
and tractors, which are traded in broad markets that include many 
potential secondary markets. The fact that vocational vehicles also 
generally accumulate far fewer annual miles than tractors further 
contributes to lengthy trade cycles among owners of these vehicles. To 
the extent vocational vehicle owners may be similar to owners of 
tractors in terms of business profiles, they are more likely to 
resemble private fleets or owner-operators than for-hire fleets. A 2013 
survey conducted by NACFE found that the trade cycle of private tractor 
fleets ranged from seven to 12 years.\381\
---------------------------------------------------------------------------

    \381\ See 2013 ICCT Barriers Report, Note 364 above.
---------------------------------------------------------------------------

    The Phase 1 standards for this vocational vehicle category 
generally apply at the chassis manufacturer level. For the same reasons 
given in Phase 1, the agencies are applying the Phase 2 vocational 
vehicle standards at the chassis manufacturer level.\382\
---------------------------------------------------------------------------

    \382\ See 76 FR 57120.
---------------------------------------------------------------------------

    The Phase 1 regulations prohibit the introduction into commerce of 
any heavy-duty vehicle without a valid certificate or exemption. 40 CFR 
1037.622, originally codified as 40 CFR 1037.620, allows for a 
temporary exemption for the chassis manufacturer if it produces the 
chassis for a secondary manufacturer that holds a certificate. The 
agencies received several comments on the requirements for secondary 
manufacturers. A discussion of temporary exemptions and obligations of 
secondary manufacturers can be found in Section V.D.(2).
    In Phase 1, the agencies adopted two equivalent sets of standards 
for Class 2b-8 vocational vehicles. For vehicle-level (chassis) 
emissions, EPA adopted CO2 standards expressed in grams per 
ton-mile. For fuel efficiency, NHTSA adopted fuel consumption standards 
expressed in gallons per 1,000 ton-miles. The Phase 1 engine-based 
standards vary based on the expected weight class and usage of the 
vehicle into which the engine will be installed. We adopted Phase 1 
vehicle-based standards that vary according to one key attribute, GVWR, 
based on the same groupings of vehicle weight classes used for the 
engine standards--light heavy-duty (LHD, Class 2b-5), medium heavy-duty 
(MHD, Class 6-7), and heavy heavy-duty (HHD, Class 8).
    In Phase 1, the agencies defined a special regulatory category 
called vocational tractor, which generally operate more like vocational 
vehicles than line haul tractors.\383\ As described above in Section 
III.C.4, under the Phase 1 rules, a vocational tractor is certified 
under standards for vocational vehicles, not those for tractors. In 
Phase 2, the agencies are revising the vocational tractor definition to 
remove heavy-haul tractors, as we are adopting tractor standards for 
these. The agencies received many comments pertaining to vocational 
tractors, which are described in Section III.C.4 and Section V.B.
---------------------------------------------------------------------------

    \383\ See EPA's regulation at 40 CFR 1037.630 and NHTSA's 
regulation at 49 CFR 523.2.
---------------------------------------------------------------------------

    Manufacturers are required to use GEM to determine compliance with 
the Phase 1 vocational vehicle standards, where the primary vocational 
vehicle manufacturer-generated input is the measure of tire rolling 
resistance. The GEM assumes the use of a typical representative, 
compliant engine in the simulation, resulting in one overall value for 
CO2 emissions and one for fuel consumption. The 
manufacturers of engines intended for use in vocational vehicles are 
subject to separate Phase 1 engine-based standards. Manufacturers also 
may demonstrate compliance with the CO2 standards in whole 
or in part using credits reflecting CO2 reductions resulting 
from technologies not reflected in the GEM testing regime. See 40 CFR 
1037.610.
    In Phase 1, EPA and NHTSA also adopted provisions designed to give 
manufacturers a degree of flexibility in complying with the standards. 
Most significantly, we adopted an ABT program to allow manufacturers to 
comply on average within a given averaging set. See 40 CFR part 1037, 
subpart H. These provisions enabled the agencies to adopt overall 
standards that are more stringent than we could have considered with a 
less flexible program.\384\
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    \384\ As noted earlier, NHTSA notes that it has greater 
flexibility in the HD program to include consideration of credits 
and other flexibilities in determining appropriate and feasible 
levels of stringency than it does in the light-duty CAFE program. 
Cf. 49 U.S.C. 32902(h), which applies to light-duty CAFE but not to 
heavy-duty fuel efficiency under 49 U.S.C. 32902(k).
---------------------------------------------------------------------------

B. Phase 2 Standards for Vocational Vehicles

    Since proposal, in addition to considering substantive written 
public comments, the agencies have held dozens of meetings with 
manufacturers, suppliers, non-governmental organizations (NGOs), and 
other stakeholders to better understand the opportunities and 
challenges involved with regulating vocational vehicles. These meetings 
have helped us to better

[[Page 73679]]

develop final Phase 2 standards. As an example, we have updated our 
industry characterization to better describe the vocational vehicle 
market, including the custom chassis manufacturers.\385\ We believe 
these information exchanges have enabled us to develop these rules with 
an appropriate balance of achievable reductions at reasonable cost with 
a reasonably small risk of unintended consequences.
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    \385\ See Chapter 1 of the RIA.
---------------------------------------------------------------------------

(1) Final Subcategories and Test Cycles
    The Phase 2 vocational vehicle standards are based on the 
performance of a wider array of control technologies than the Phase 1 
rules. In particular, as proposed, the Phase 2 vocational vehicle 
standards recognize detailed characteristics of powertrains and 
drivelines. As described below, driveline improvements present a 
significant opportunity for reducing fuel consumption and 
CO2 emissions from vocational vehicles. However, there is no 
single package of driveline technologies that will be equally suitable 
for the majority of vocational vehicles, because there is an extremely 
broad range of driveline configurations available in the market. This 
is due in part to the variety of build processes, ranging from a 
purpose built custom chassis to a commercial chassis that may be 
intended as a multi-purpose stock vehicle. Further, the wide range of 
applications and driving patterns of these vehicles leads manufacturers 
to offer a variety of drivelines, as each performs differently in use. 
For example, depending on whether the transmission has an overdrive 
gear, drive axle ratios for Class 7 and 8 tractors can generally be 
found in the range of 2.5:1 to 4.1:1. By contrast, across all types of 
vocational vehicles, drive axle ratios can range from 3.1:1 (delivery 
vehicle) to 9.8:1 (transit bus).\386\ Other components of the driveline 
also have a broader range of product in vocational vehicles than in 
tractors, including transmission gears, tire sizes, and engine speeds. 
Each of these design features affects the GHG emission rate and fuel 
consumption of the vehicle. It therefore is reasonable to define more 
than one baseline configuration of vocational vehicle, to encompass a 
range of drivelines. A detailed list of the technologies the agencies 
project could be adopted to meet the vocational vehicle standards is 
described in Section V.C, and in the RIA Chapter 2.9, along with a 
description of the differences in technology effectiveness that are 
projected to be demonstrated through GEM under different test cycles. 
The agencies have found that the ranges of effectiveness of a majority 
of the technologies are significant enough to merit creation of 
subcategories with different test cycles.
---------------------------------------------------------------------------

    \386\ See Dana Spicer Drive Axle Application Guidelines, 
available at http://www.dana.com/wps/wcm/connect/133007004bd8422b9ea8be14e7b6dae0/DEXT-daag2012_0712_DriveAxlesAppGuide_LR.pdf?MOD=AJPERES&CONVERT_TO=url&CACHEID=133007004bd8422b9ea8be14e7b6dae0. See also ZF Driveline and 
Chassis Technology brochure, available at http://www.zf.com/media/media/en/document/corporate_2/downloads_1/flyer_and_brochures/bus_driveline_technology_flyer/Busbroschuere_12_DE_final.pdf.
---------------------------------------------------------------------------

(a) Basis for Duty Cycles and Subcategories
    The agencies are relying on work conducted by the U.S. Department 
of Energy at the National Renewable Energy Laboratory (NREL), as well 
as duty cycle information provided in public comments, in establishing 
the weighting factors for the test cycles to be used in the 
certification of heavy-duty vocational vehicles to the final Phase 2 
standards. NREL's methodology and findings are described in a report in 
the docket for this rulemaking.\387\ The data from NREL have also 
informed our segmentation process, and to some extent the technology 
assessment. For example, without data regarding the amount of parked 
idle observed by vocational vehicles in the NREL database, we would not 
have been able to sufficiently identify and recognize technologies that 
separately reduce either drive idle or parked idle emissions.\388\ 
Based on available fleet data, NREL identified three general clusters 
of vehicle behavior: one cluster of vehicles most often driving with 
slower speeds and frequent stops; one with higher average speeds and 
fewer stops; and one multi-modal cluster with vehicles that may operate 
similarly to either of the other clusters on any given day. In Chapter 
2.2 of the NREL report, an alternate bi-modal clustering analysis is 
also presented, where instead of having a distinct middle cluster, 
vehicles with highly variable driving patterns are grouped as either 
high speed or low speed. A preliminary update provided by NREL includes 
cycle weightings that correspond with this two cluster depiction of 
vehicle behavior.\389\ Based on the NREL report and other information, 
the agencies believe it is appropriate to finalize a regulatory 
subcategory structure that includes a drive cycle appropriate for mixed 
use vehicles; especially considering that the ultimate application of 
incomplete chassis is unknown at the time of certification. In other 
words, we are adopting a program structure that follows NREL's three 
cluster depiction of vehicle behavior. The final rules' primary 
vocational standards thus have subcategories for Regional, Multi-
purpose, and Urban drive cycles in each of the three weight classes 
(LHD, MHD and HHD), which results in nine unique subcategories.
---------------------------------------------------------------------------

    \387\ National Renewable Energy Laboratory July 2016, ``The 
Development of Vocational Vehicle Drive Cycles and Segmentation,'' 
NREL/TP-5400-65921.
    \388\ While drive idle can generally be thought of as in-gear 
and parked idle can generally be thought of as out-of-gear, NREL has 
data on driving patterns for trucks with manual transmissions and 
has considered the fact that these are always out of gear when the 
vehicle has zero speed. See Section 5.5 of the final NREL report for 
more details.
    \389\ See memorandum dated July 2016 titled, ``NREL Bi-Modal 
Vocational Vehicle Cluster Information.''
---------------------------------------------------------------------------

    In the final weeks before promulgation, the agencies received 
significant new comments from a number of vehicle manufacturers, along 
with new data characterizing in detail the distribution of powertrain 
configurations of their vehicles.\390\ These recent comments suggested 
some uncertainty with respect to the three drive cycle structure, and 
the manufacturers expressed related concerns regarding assumptions 
about transmissions in our baseline vehicle configurations, which they 
believe could result in some OEMs being put at competitive 
disadvantage. The agencies appreciate these new comments and data; 
however, we determined that it would not be appropriate to alter this 
regulatory action so late in the rulemaking process based solely upon 
this newly submitted information, which was not made available for 
broader public comment. Instead, the agencies will continue to analyze 
this new information and any other new information we receive. We will 
also continue to actively engage with manufacturers and other 
stakeholders to determine if future revisions to the vocational vehicle 
program structure are warranted, based on this and any other new 
information. For example, it is possible that further analysis of new 
data could lead us to consider proposing amendments to adopt the two 
cluster approach for one or more of the vehicle weight classes, or to 
consider amending the regulatory constraints limiting the choice of 
drive cycle subcategory that we are adopting to prevent potential 
adverse impacts of vehicle misclassification. However, at this time the 
final program structure, including these constraints, will remain in 
place

[[Page 73680]]

unless and until the agencies determine that revisions to the 
vocational vehicle program structure are warranted, in which case the 
agencies would undertake a notice and comment rulemaking proposing to 
amend the programmatic structure, consistent with such a determination. 
In considering whether to undertake further action, the agencies will 
necessarily be mindful of statutory lead time requirements and other 
practical considerations.
---------------------------------------------------------------------------

    \390\ See memorandum dated July 2016 titled, ``Summary of Late 
Comments on Vocational Transmissions and N/V.''
---------------------------------------------------------------------------

    NREL also synthesized a new transient test cycle using statistical 
targets and the DRIVE tool. Eaton commented that the new transient 
cycle developed by NREL is similar to cycles they use to calibrate 
shift controls, and is more representative of how trucks are driven 
than the current ARB Transient certification test cycle. Although there 
is some reason to believe this new cycle may actually be more 
representative of nationwide operation than the ARB transient cycle, 
the agencies recognize that sufficient uncertainty remains that we are 
not prepared to adopt this new NREL transient cycle for Phase 2 
certification at this time. The agencies also note that, although GEM 
has been extensively validated for the ARB transient cycle, we have not 
conducted a similar validation for the NREL cycle. Nevertheless, we 
will continue to evaluate this cycle and may reconsider it as part of a 
future rulemaking. The most significant shortfall identified by NREL in 
their comparison of real world vocational vehicle operation and the ARB 
transient cycle is a gap in measurement points between speeds of 48 and 
55 mph. We have remedied this shortfall by adjusting the composite 
weighting factor of the 55 mph cruise cycle. Because vehicles tested in 
GEM over our final road grade profile have been observed to decrease 
speed well below 55 mph during this cycle, those measurement points 
that are absent from the ARB transient cycle are captured in the 
nominally 55 mph test cycle.
    Other commenters questioned whether the vehicles from which NREL 
collected data for the cycle were sufficiently representative, or 
whether sufficient data existed to justify the NREL weightings, while 
other commenters supported use of the data. Daimler supported making 
changes to reflect the NREL-recommended weightings to align with real-
world data. ACEEE supported using the more realistic NREL cycle 
weightings to revisit stringency where certain technologies may be more 
effective over the new cycles. Both Volvo and Navistar expressed 
concerns that the NREL study fleet doesn't appear to be representative. 
Navistar believes that the NREL data has too few refuse trucks, and 
Volvo believes that the NREL data has too few class 8 vehicles. In 
fact, 35 percent of the vehicles in the NREL database that were 
evaluated for the drive cycle analysis are class 8, which we believe is 
(if anything) over-representative of the percent of new HHD vehicles 
manufactured each year. Because the full NREL database also contains 
over five percent refuse trucks and our MOVES model estimates that 
refuse trucks comprise only three percent of newly manufactured 
vocational vehicles each year, we directed NREL to remove excess refuse 
trucks from their final analysis, to avoid skewing the data by over-
representing refuse trucks.\391\ A similar process was followed for 
removing excess school buses and transit buses. More details are 
available in the NREL report.\392\ While some discrepancies may remain 
between the NREL vehicle distribution and the national fleet, we are 
confident they are sufficiently small to allow us to use this report to 
establish weighting factors for different types of operation. Moreover, 
the agencies believe the more relevant question to be whether or not 
the cycles exercise the technologies over enough of the range of in-use 
operation to effect in-use reductions, and to reasonably estimate the 
extent of those reductions. In this context, the weighting factors and 
duty-cycles are fully adequate.
---------------------------------------------------------------------------

    \391\ MOVES 2014. See Note 379 above.
    \392\ National Renewable Energy Laboratory July 2016, ``The 
Development of Vocational Vehicle Drive Cycles and Segmentation,'' 
NREL/TP-5400-65921.
---------------------------------------------------------------------------

    After considering all the comments, the agencies are establishing 
nine subcategories of vocational vehicles in Phase 2, based on the 
three weight class groups of vocational vehicles described above that 
are continuing from the Phase 1 program, plus Regional, Multipurpose 
and Urban duty cycle groups, as shown in Table V-1 below. For reasons 
described below in Section V.C.(2)(a) we are not establishing distinct 
subcategories for SI-powered vocational vehicles in the HHD weight 
class. Thus, with nine diesel subcategories and six gasoline 
subcategories, we are essentially setting 15 separate numerical 
performance standards. As described in Section V.B.2, we are also 
adopting optional standards for seven subcategories of custom 
vocational chassis.
    This structure enables the technologies that perform best at 
highway speeds and those that perform best in urban driving to each be 
properly recognized over appropriate drive cycles, while avoiding 
unintended results of forcing vocational vehicles that are designed to 
serve in different applications to be measured against a single drive 
cycle. The agencies intend for these three drive cycles to balance the 
competing pressures to recognize the varying performance of 
technologies, serve the wide range of customer needs, and maintain 
reasonable regulatory simplicity. In light of the very recent comments 
noted above, if the agencies were to determine in the future that 
revisions to the vocational vehicle program structure are warranted, we 
would intend to propose any revisions in a way that would be consistent 
with the technology feasibility and cost-benefit analyses of this final 
rulemaking. In other words, the agencies do not anticipate any changes 
to the technology basis for, or the effective stringency of, the final 
standards. Rather, potential changes in program structure would only be 
to better assure that the projected reductions are achieved in use, 
consistent with the projected technology packages on whose performance 
the stringency of the final standards are based, and consistent with 
the costs we projected for that compliance pathway.

                           Table V-1--Regulatory Subcategories for Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                        Light heavy-duty class  Medium heavy-duty class   Heavy heavy-duty class
             Weight class                        2b-5                     6-7                  8 (CI only)
----------------------------------------------------------------------------------------------------------------
Duty Cycle...........................  Regional...............  Regional...............  Regional.
                                       Multi-Purpose..........  Multi-Purpose..........  Multi-Purpose.
                                       Urban..................  Urban..................  Urban.
----------------------------------------------------------------------------------------------------------------


[[Page 73681]]

    In the NREL Fleet DNA clustering analysis, the medioid of each 
cluster was characterized using eight drive cycle metrics, and distance 
histograms were created for each statistically representative vehicle. 
By summing the miles accumulated at different driving speeds (including 
zero speed idle), NREL was able to recommend composite cycle 
weightings. Commenters suggested that the proposed weightings of both 
highway cruise and idle were too low for some vehicles. When the 
agencies released additional data for comment in February 2016, an 
early draft of NREL's duty cycle report was included. Most commenters 
supported the draft NREL duty cycles. Volvo commented that NREL's cycle 
weightings didn't match their extensive telematics database for their 
class 8 vocational vehicles, and recommended specific changes to 
increase the weighting of 65 mph for Urban and Multipurpose HHD 
vehicles. A description of the drive cycle data submitted to the 
agencies by Volvo in support of the final test cycles is found in the 
RIA Chapter 3.4.3.1. In response, we have adjusted our composite test 
weightings for Urban and Multipurpose HHD vehicles in consideration of 
Volvo's data. Although Volvo also suggested specific cycle weightings 
for coach buses, we have established optional coach bus standards (one 
example of the custom chassis standards the agencies are adopting) with 
the same weightings as for other Regional vehicles for reasons 
described below in V.B.2.b. The final cycle weightings shown in Table 
V-2 reflect NREL's recommendations along with consideration of public 
comments. Although both NREL and Volvo data showed vehicles whose 
behavior would logically be classified as Urban accumulating some miles 
(from one to seven percent) in the 65 mph range, the agencies are 
applying a zero weighting factor to the 65 mph cycle for all Urban 
vehicles for certification purposes. Instead, those miles are assigned 
to the 55 mph cycle. We believe it is important to have a test cycle 
available in the primary program for vehicles that may regularly drive 
on urban or local highways, but are not expected (or designed) to drive 
on rural highways. Further, the final rules include the refinement of a 
split idle cycle (parked idle and drive idle), since NREL's final 
report includes analysis of data characterizing the percent of time in 
a work day that vocational vehicles idle when parked as distinct from 
idling time when stopped in traffic. More details on the 
characterization of parked and drive idle are found in the RIA Chapter 
2.9.3.4. More details of the NREL clustering analysis are found in the 
RIA Chapter 2.9.2, and more details on the data behind the final 
composite cycle weightings are found in the RIA Chapter 3.4.3.

                 Table V-2--Composite Test Cycle Weightings (in Percent) for Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                                  55 mph  Cruise  65 mph  Cruise
                                   ARB transient    with  road      with  road      Parked idle     Drive idle
                                                     grade \a\       grade \a\
----------------------------------------------------------------------------------------------------------------
Regional........................            0.20            0.24            0.56            0.25            0.00
Multi-Purpose (2b-7)............            0.54            0.29            0.17            0.25            0.17
Multi-Purpose (class 8).........            0.54            0.23            0.23            0.25            0.17
Urban (2b-7)....................            0.92            0.08            0.00            0.25            0.15
Urban (class 8).................            0.90            0.10            0.00            0.25            0.15
----------------------------------------------------------------------------------------------------------------
Note:
\a\ As described in Section II, the agencies have adopted highway cruise test cycles with revised road grade
  profiles.

    We recognize that by adopting a few meaningful duty cycles that 
``bound'' how vocational vehicles are generally used, we cannot 
perfectly match how every vocational vehicle is actually used. There 
are a few vehicle applications we have identified, for which these 
general cycles are likely to be poorly representative. We received 
several comments that our proposed duty cycles are particularly 
unrepresentative of real world behavior of transit buses and refuse 
trucks, for example. These vehicles also generally have chassis 
characteristics unlike those in the reference GEM vehicles used to 
establish the subcategory baselines. The agencies have determined that 
it is impractical, from a regulatory perspective, to establish 
separate, unique test cycles for transit buses or refuse trucks. In 
considering the challenges of such an undertaking, as well as the 
market structure of manufacturers who produce such vehicles, the 
agencies are instead adopting separate standards for transit buses and 
refuse trucks as part of the final Phase 2 program for custom 
vocational chassis, as described in Section V.B.(2)(b).
    Vocational vehicles neither qualifying under the optional custom 
chassis program nor meeting eligibility for exemption as low speed/off 
road vehicles will need to be certified in one of the primary 
subcategories established in this rulemaking. Below in Section V.C, the 
agencies explain the technology basis supporting the standards for each 
vehicle weight class.
    The agencies received extensive comment on how to define attributes 
of vehicles in each subcategory to provide regulatory certainty to 
manufacturers. The proposed approach was to set criteria by which a 
vehicle manufacturer would know in which vocational subcategory--
Regional, Urban, or Multipurpose--the vehicle should be certified, by 
use of cut-points defined using calculations relating engine speed to 
vehicle speed. Two commenters suggested we reinstate the Phase 1 
approach with a one-size-fits-all drive cycle. Six commenters agreed 
with the proposed approach on subcategorization, though some 
recommended slight adjustments. The final rules allow manufacturers to 
generally choose the subcategory of each vocational chassis, with a 
revised set of constraints essentially reflecting types of equipment on 
the vehicle (especially transmission type). In Section V.C.(2)(a) and 
the RIA Chapter 2.9, we describe changes since proposal with respect to 
the baseline vehicle configurations. In Section V.C.(2)(d), we describe 
the changes since proposal reflecting use of fleet average sales mixes 
in the standard-setting process. In Section V.D.(1)(e), we describe the 
constraints we are adopting regarding selection of subcategories by 
manufacturers. Taken together, these analyses demonstrate why we are 
confident that even if (generally against its own interests) a 
manufacturer chooses to certify a vehicle over a less appropriate test 
cycle, that choice would not result in a loss of environmental benefit. 
Continuing the averaging scheme from Phase 1, each manufacturer will

[[Page 73682]]

generally be able to average within each vehicle weight class (i.e. 
averaging sets are not further limited by the Regional, Multi-purpose, 
Urban subcategorization).
(b) Vocational Tractors
    As discussed in Section V.A., the Phase 1 program includes a 
special regulatory category called vocational tractors, which covers 
vehicles that are technically tractors but generally operate more like 
vocational vehicles than line haul tractors. Heavy-haul, off-road, and 
certain intra-city delivery tractors are eligible for this category in 
the Phase 1 program, but manufacturers may also choose to certify them 
as conventional tractors. The agencies proposed to keep this program in 
Phase 2, but to exclude heavy-haul tractors. With the removal of heavy-
haul tractors from the vocational tractor definition (see 40 CFR 
1037.630 and 49 CFR 523.2), the agencies have re-assessed the vehicles 
remaining in this group, and the most appropriate way for them to be 
certified. One typically thinks of beverage tractors in this group, 
though it may also include drayage tractors, vehicle carriers, 
construction vehicles, and many vehicles with unusual axle 
configurations. NREL observed drayage tractors with operational 
patterns consistent with the Regional duty cycle.\393\ Volvo also 
commented that their vocational tractors would logically fall in the 
Regional duty cycle. The agencies have therefore concluded that these 
vehicles may reasonably be represented by our final regulatory duty 
cycles, and are requiring that vocational tractors not meeting other 
exemption criteria must use one of the vocational vehicle duty cycles.
---------------------------------------------------------------------------

    \393\ Comparing the vocational Regional duty cycle to the day 
cab tractor duty cycle, vocational Regionals have one percent 
greater weighting of the ARB Transient, 6 percent more weighting of 
the 55 cycle, 8 percent less weighting of the 65 cycle, plus 25 
percent parked idle.
---------------------------------------------------------------------------

    There is a separate question of whether vocational tractors may 
have their performance fairly measured against the agencies' defined 
baseline vocational configurations. The agencies requested comment on 
whether vocational tractors would be deficit-generating vehicles if 
certified in the proposed vocational vehicle subcategories. When a 
vehicle is designed with a higher power engine or higher number of 
axles to carry a heavier payload than presumed in the GEM baseline for 
that subcategory, GEM may return a value that poorly represents the 
real world performance of that vehicle. We received comments from the 
chassis manufacturers who certify vocational tractors, plus two other 
comments. These comments consistently asked the agencies to allow some 
tractors with GVWR over 120,000 lbs but not qualifying as heavy-haul 
tractors to remain as vocational vehicles rather than be forced to 
certify to the primary tractor standards. Volvo submitted written 
comments stating that a separate regulatory subcategory with unique 
performance standard is warranted for vocational tractors. However, 
during a subsequent telephone conversation, Volvo stated that their 
vocational tractors would be adequately represented by the other 
defined subcategories, and a unique subcategory was not necessary.\394\ 
See Section III.C.(4). for a discussion of the attributes adopted by 
the agencies as distinguishing vocational tractors from regular or 
heavy-haul tractors.
---------------------------------------------------------------------------

    \394\ See call log for L. Steele, conversation with M. Miller, 
dated January 18, 2016.
---------------------------------------------------------------------------

    Based on comments and our technical analysis, the agencies have 
concluded that the technologies determined to be feasible for regular 
vocational vehicles are also feasible for vocational tractors, with 
similar adoption rates and package costs. Further, we are not aware of 
any non-diversified chassis manufacturers producing vocational 
tractors. One implication is that we believe that all manufacturers 
certifying vocational tractors will be able to take advantage of our 
ABT program flexibilities. According to MY 2014 certification data, 
less than 14,000 vocational tractors were certified between the three 
manufacturers, including an unidentifiable number that would likely 
qualify as heavy-haul tractors, if that definition existed in Phase 1. 
Thus, possible deficits (if any) generated by the small sales volume of 
vocational tractors in Phase 2 could likely be accommodated within each 
company's overall compliance plan.
(2) GHG and Fuel Consumption Standards for Vocational Vehicles
    EPA is adopting CO2 standards and NHTSA is adopting fuel 
consumption standards for manufacturers of chassis for new vocational 
vehicles. As described in Sections II.C.(1) and II.D.(1) above, the 
agencies are adopting test procedures so that engine performance will 
be evaluated within the GEM simulation tool. These test procedures 
include corrections for the test fuel, enabling vocational vehicles to 
be certified with many different types of CI and SI engines. In 
addition, EPA is establishing HFC leakage standards for air 
conditioning systems in vocational vehicles, as described in Section 
V.B.(2)(c), with more details available in the RIA Chapter 2.9.3.8 and 
Chapter 5.3.4.
    This section describes the standards and implementation dates that 
the agencies are adopting for the 15 regulatory subcategories of 
vocational vehicles, plus the optional standards for the seven custom 
vocational chassis categories. The agencies have performed a technology 
analysis to determine the level of standards that we believe will be 
available at reasonable cost, cost-effective, technologically feasible, 
and appropriate in the lead time provided. More details of this 
analysis are described in the RIA Chapter 2.9. This analysis considered 
the following for each of the regulatory subcategories:
     The level of technology that is incorporated in current 
new vehicles,
     forecasts of manufacturers' product redesign schedules,
     the available data on CO2 emissions and fuel 
consumption for these vehicles,
     technologies that will reduce CO2 emissions and 
fuel consumption and that are judged to be feasible and appropriate for 
these vehicles through the 2027 model year,
     the effectiveness and cost of these technologies,
     a projection of the technologically feasible application 
rates of these technologies, in this time frame, and
     projections of future U.S. sales for different types of 
vehicles and engines.
    The final Phase 2 program described here and throughout the 
rulemaking documents is derived from the preferred alternative, 
referred to as Alternative 3 in the NPRM.
(a) Primary Fuel Consumption and CO2 Standards
    The agencies' final standards will phase in over a period of seven 
years, beginning in the 2021 model year, consistent with the 
requirement in EISA that NHTSA's standards provide four full model 
years of regulatory lead time and three full model years of regulatory 
stability, and provide sufficient time ``to permit the development and 
application of the requisite technology'' for purposes of CAA section 
202(a)(2). The Phase 2 program will progress in three-year stages with 
an intermediate set of standards in MY 2024 and will continue to reduce 
fuel consumption and CO2 emissions well beyond the full 
implementation year of MY 2027. The agencies have identified a 
technology path for each of these levels of improvement, as described 
below.
    Combining engine and vehicle technologies, vocational vehicles 
powered by CI engines are projected to achieve improvements as much as 
24

[[Page 73683]]

percent in MY 2027 over the MY 2017 baseline, as described below and in 
the RIA Chapter 2.9. The agencies project up to 18 percent improvement 
in fuel consumption and CO2 emissions in MY 2027 from SI-
powered vocational vehicles, as shown in Table V-3. The incremental 
Phase 2 vocational vehicle standards will ensure steady progress toward 
the MY 2027 standards, with improvements for CI-powered vehicles in MY 
2021 of up to 12 percent and improvements for CI-powered vehicles in MY 
2024 of up to 20 percent over the MY 2017 baseline vehicles, as shown 
in Table V-3.
    The agencies' analyses, as discussed in this Preamble and in the 
RIA Chapter 2, show that these standards are appropriate under each 
agency's respective statutory authority.

    Table V-3--Projected Vocational Vehicle CO[ihel2] and Fuel Use Reductions (in Percent) from 2017 Baseline
----------------------------------------------------------------------------------------------------------------
                                                                                                   Light  heavy-
              Model year                       Engine type         Heavy  heavy-  Medium  heavy-  duty Class 2b-
                                                                   duty Class 8   duty Class 6-7         5
----------------------------------------------------------------------------------------------------------------
2021..................................  CI Engine...............             7-9            6-11            7-12
                                        SI Engine...............  ..............             5-7             6-8
2024..................................  CI Engine...............           12-16           11-18           11-20
                                        SI Engine...............  ..............            9-12            9-14
2027..................................  CI Engine...............           14-20           12-22           13-24
                                        SI Engine...............  ..............           10-16           11-18
----------------------------------------------------------------------------------------------------------------

    Based on our analysis and research, and our consideration of the 
public comments, the agencies conclude that the improvements in 
vocational vehicle fuel consumption and CO2 emissions can be 
achieved through deployment and utilization of a greater set of 
technologies than formed the technology basis for the Phase 1 
standards. Further, since proposal, our assessment of technology 
effectiveness has changed primarily due to revisions in duty cycles and 
in some cases, the technologies themselves. The agencies received 
comments addressing the vocational vehicle standards broadly, including 
baselines, structure, and technologies. In response, in developing the 
final standards, the agencies have reevaluated the current levels of 
fuel consumption and emissions, the kinds of technologies that could be 
utilized by manufacturers to reduce fuel consumption and emissions, the 
associated lead time, the associated costs for the industry, fuel 
savings for the owner/operator, and the magnitude of the CO2 
reductions and fuel savings that may be achieved. After reexamining the 
possibilities of vehicle improvements, the agencies are basing the 
final standards on the performance of workday idle reduction 
technologies, improved transmissions including mild hybrid powertrains, 
axle technologies, weight reduction, electrified accessories, tire 
pressure systems, and further tire rolling resistance improvements. The 
EPA-only air conditioning standard is based on leakage improvements. 
These are largely the same technologies as we considered for the 
proposal, although some technologies that had been available only to 
tractors at proposal are now recognized for vocational vehicles. Our 
updated analysis shows that more stringent standards than proposed are 
feasible, based in large part on our new assessment of the 
effectiveness of workday idle controls.
    The agencies' evaluation indicates that some of the above vehicle 
technologies are commercially available today, though often in limited 
volumes. Other technologies will need additional time for development. 
Those that we believe are available today and may be adopted to a 
limited extent in some vehicles include improved tire rolling 
resistance, weight reduction, some types of conventional transmission 
improvements, neutral idle, and air conditioning leakage improvements. 
However, the first model year for the final Phase 2 standards will not 
be until MY 2021.\395\ As at proposal, the EPA continues to believe 
that any potential benefits that could be achieved by implementing 
rules requiring some technologies on vocational vehicles earlier than 
MY 2021 to be outweighed by several disadvantages. For one, 
manufacturers will need lead time to develop compliance tracking tools. 
Also, if the Phase 2 vocational vehicle standards began in a different 
year than the tractor standards, this could create unnecessary added 
complexity, and could strongly detract from the fuel savings and GHG 
emission reductions that could otherwise be achieved. Therefore the 
Phase 1 standards will continue to apply in model years 2018 to 2020. 
No commenter suggested otherwise.
---------------------------------------------------------------------------

    \395\ NHTSA is unable to adopt mandatory amended standards in 
those model years since there will be less than the statutorily-
prescribed amount of lead time available. 49 U.S.C. 32902(k)(3)(A).
---------------------------------------------------------------------------

    Vehicle technologies that we expect will be available in the near 
term include neutral idle, low rolling resistance tires, improved axle 
efficiency, and part-time 6x2 axles. Vehicle technologies that we have 
determined will benefit from even more development time to integrate 
engine and vehicle systems include stop-start idle reduction and hybrid 
powertrains. The agencies have analyzed the technological feasibility 
of achieving the fuel consumption and CO2 standards, based 
on projections of what actions manufacturers may be expected to take to 
reduce fuel consumption and emissions to achieve the standards, and 
believe that the standards are technologically feasible throughout the 
regulatory useful life of the program. The basis for this finding is 
discussed below in Section V.C.3. EPA and NHTSA estimated vehicle 
package costs are found in Section V.C.(2).
    Table V-4 and Table V-5 present EPA's CO2 standards and 
NHTSA's fuel consumption standards, respectively, for chassis 
manufacturers of Class 2b through Class 8 vocational vehicles for the 
beginning model year of the program, MY 2021. As in Phase 1, the 
standards are in the form of the mass of emissions, or gallons of fuel, 
associated with carrying a ton of cargo over a fixed distance. The EPA 
standards are measured in units of grams CO2 per ton-mile 
and the NHTSA standards are in gallons of fuel per 1,000 ton-miles. 
With the mass of freight in the denominator of this term, the program 
is designed to measure improved efficiency in terms of freight 
efficiency. As in Phase 1, the Phase 2 program assigns a fixed default 
payload in GEM for each vehicle weight class group (heavy heavy-duty, 
medium heavy-duty, and light heavy-duty). Even though this 
simplification does not allow individual vehicle freight efficiencies 
to be recognized, the general capacity for larger vehicles to carry 
more payload is represented in the

[[Page 73684]]

numerical values of these standards for each weight class group.
    For each model year of the standards described below, the standards 
for vehicles powered by CI engines reflect improvements that correspond 
with performance of technologies projected to meet the separate CI 
engine standard in that year, as modeled over the GEM vehicle cycles. 
In other words, the CI vehicle standard directly reflects, and keeps 
pace with, the increasing stringency of the CI engine standard. As 
described above in Section II.D, the SI engine standard is remaining 
unchanged from Phase 1. However, the standards in each model year for 
vocational vehicles powered by SI engines are based in part on the 
performance of some additional engine technologies beyond what is 
required to meet the SI engine standards. In other words, certain SI 
engine improvements are reflected in the stringency of the SI vehicle 
standard.
    EPA's vocational vehicle CO2 standards and NHTSA's fuel 
consumption standards for the MY 2024 stage of the program are 
presented in Table V-6 and Table V-7, respectively. These reflect 
broader adoption rates of vehicle technologies already considered in 
the technology basis for the MY 2021 standards. EPA's vocational 
vehicle CO2 standards and NHTSA's fuel consumption standards 
for the full implementation year of MY 2027 are presented in Table V-8 
and Table V-9, respectively. These reflect even greater adoption rates 
of the same vehicle technologies considered as the basis for the 
previous stages of the Phase 2 standards.
    These standards are based on highway cruise cycles that include a 
final road grade profile that has been refined as a result of comment. 
This enables the standard and the GEM certification results to better 
reflect real world driving and to help recognize engine and driveline 
technologies while seeking to assure that technologies result in real 
world benefit. See the RIA Chapter 3.4.2.1.
    As described in Section I, the agencies are continuing the Phase 1 
approach to averaging, banking and trading (ABT), allowing ABT within 
vehicle weight classes. For Phase 2, continuing this approach means 
allowing averaging between CI-powered vehicles and SI-powered vehicles 
of any subcategory belonging to the same weight class group, which have 
the same regulatory useful life. However these averaging sets exclude 
vehicles certified to the separate custom chassis standards. Although 
we are further subdividing each vocational weight class group into 
Urban, Multi-Purpose, and Regional subcategories, we are not 
restricting credit exchanges between them. This is similar to the 
allowance to trade between vocational vehicles and tractors within a 
weight class. It is also consistent with the Phase 1 program, where the 
different types of vehicles within a weight class were included in a 
single averaging set.

                  Table V-4--EPA CO[ihel2] Standards for MY 2021 Class 2b-8 Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                                                Light  heavy-
                          Duty cycle                           duty Class 2b-   Medium heavy-  Heavy  heavy-duty
                                                                      5        duty Class 6-7       Class 8
----------------------------------------------------------------------------------------------------------------
               EPA Standard for Vehicle with CI Engine Effective MY 2021 (gram CO[ihel2]/ton-mile)
----------------------------------------------------------------------------------------------------------------
Urban........................................................             424             296                308
Multi-Purpose................................................             373             265                261
Regional.....................................................             311             234                205
----------------------------------------------------------------------------------------------------------------
               EPA Standard for Vehicle with SI Engine Effective MY 2021 (gram CO[ihel2]/ton-mile)
----------------------------------------------------------------------------------------------------------------
Duty cycle                                                              Light   Medium heavy-
                                                                   heavy-duty  duty Class 6-7
                                                                   Class 2b-5         (and C8
                                                                                    gasoline)
----------------------------------------------------------------------------------------------------------------
Urban........................................................             461             328
Multi-Purpose................................................             407             293
Regional.....................................................             335             261
----------------------------------------------------------------------------------------------------------------


             Table V-5--NHTSA Fuel Consumption Standards for MY 2021 Class 2b-8 Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                                                Light  heavy-  Medium  heavy-
                          Duty cycle                           duty Class 2b-  duty  Class 6-  Heavy  heavy-duty
                                                                      5               7             Class 8
----------------------------------------------------------------------------------------------------------------
    NHTSA Standard for Vehicle with CI Engine Effective MY 2021 (Fuel Consumption gallon per 1,000 ton-mile)
----------------------------------------------------------------------------------------------------------------
Urban........................................................         41.6503         29.0766            30.2554
Multi-Purpose................................................         36.6405         26.0314            25.6385
Regional.....................................................         30.5501         22.9862            20.1375
----------------------------------------------------------------------------------------------------------------
    NHTSA Standard for Vehicle with SI Engine Effective MY 2021 (Fuel Consumption gallon per 1,000 ton-mile)
----------------------------------------------------------------------------------------------------------------
Duty cycle                                                              Light          Medium
                                                                   heavy-duty      heavy-duty
                                                                   Class 2b-5       Class 6-7
                                                                                      (and C8
                                                                                    gasoline)
----------------------------------------------------------------------------------------------------------------
Urban........................................................         51.8735         36.9078
Multi-Purpose................................................         45.7972         32.9695

[[Page 73685]]

 
Regional.....................................................         37.6955         29.3687
----------------------------------------------------------------------------------------------------------------


                  Table V-6--EPA CO[ihel2] Standards for MY 2024 Class 2b-8 Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                                                Light  heavy-
                          Duty cycle                           duty Class 2b-  Medium  heavy-  Heavy  heavy-duty
                                                                      5        duty Class 6-7       Class 8
----------------------------------------------------------------------------------------------------------------
               EPA Standard for Vehicle with CI Engine Effective MY 2024 (gram CO[ihel2]/ton-mile)
----------------------------------------------------------------------------------------------------------------
Urban........................................................             385             271                283
Multi-Purpose................................................             344             246                242
Regional.....................................................             296             221                194
----------------------------------------------------------------------------------------------------------------
               EPA Standard for Vehicle with SI Engine Effective MY 2024 (gram CO[ihel2]/ton-mile)
----------------------------------------------------------------------------------------------------------------
Duty cycle                                                              Light          Medium
                                                                   heavy-duty      heavy-duty
                                                                   Class 2b-5       Class 6-7
                                                                                      (and C8
                                                                                    gasoline)
----------------------------------------------------------------------------------------------------------------
Urban........................................................             432             310
Multi-Purpose................................................             385             279
Regional.....................................................             324             251
----------------------------------------------------------------------------------------------------------------


             Table V-7--NHTSA Fuel Consumption Standards for MY 2024 Class 2b-8 Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                                                Light  heavy-  Medium  heavy-
                          Duty cycle                           duty Class 2b-  duty  Class 6-  Heavy  heavy-duty
                                                                      5               7             Class 8
----------------------------------------------------------------------------------------------------------------
    NHTSA Standard for Vehicle with CI Engine Effective MY 2024 (Fuel Consumption gallon per 1,000 ton-mile)
----------------------------------------------------------------------------------------------------------------
Urban........................................................         37.8193         26.6208            27.7996
Multi-Purpose................................................         33.7917         24.1650            23.7721
Regional.....................................................         29.0766         21.7092            19.0570
----------------------------------------------------------------------------------------------------------------
    NHTSA Standard for Vehicle with SI Engine Effective MY 2024 (Fuel Consumption gallon per 1,000 ton-mile)
----------------------------------------------------------------------------------------------------------------
Duty cycle                                                              Light          Medium
                                                                   heavy-duty      heavy-duty
                                                                   Class 2b-5       Class 6-7
                                                                                      (and C8
                                                                                    gasoline)
----------------------------------------------------------------------------------------------------------------
Urban........................................................         48.6103         34.8824
Multi-Purpose................................................         43.3217         31.3942
Regional.....................................................         36.4577         28.2435
----------------------------------------------------------------------------------------------------------------


                  Table V-8--EPA CO[ihel2] Standards for MY 2027 Class 2b-8 Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                                                Light  heavy-  Medium  heavy-
                          Duty cycle                           duty Class 2b-  duty  Class 6-  Heavy  heavy-duty
                                                                      5               7             Class 8
----------------------------------------------------------------------------------------------------------------
               EPA Standard for Vehicle with CI Engine Effective MY 2027 (gram CO[ihel2]/ton-mile)
----------------------------------------------------------------------------------------------------------------
Urban........................................................             367             258                269
Multi-Purpose................................................             330             235                230
Regional.....................................................             291             218                189
----------------------------------------------------------------------------------------------------------------

[[Page 73686]]

 
               EPA Standard for Vehicle with SI Engine Effective MY 2027 (gram CO[ihel2]/ton-mile)
----------------------------------------------------------------------------------------------------------------
Duty cycle                                                              Light          Medium
                                                                   heavy-duty      heavy-duty
                                                                   Class 2b-5       Class 6-7
                                                                                      (and C8
                                                                                    gasoline)
----------------------------------------------------------------------------------------------------------------
Urban........................................................             413             297
Multi-Purpose................................................             372             268
Regional.....................................................             319             247
----------------------------------------------------------------------------------------------------------------


             Table V-9--NHTSA Fuel Consumption Standards for MY 2027 Class 2b-8 Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                                                Light  heavy-  Medium  heavy-
                          Duty cycle                           duty Class 2b-  duty  Class 6-  Heavy  heavy-duty
                                                                      5               7             Class 8
----------------------------------------------------------------------------------------------------------------
    NHTSA Standard for Vehicle with CI Engine Effective MY 2027 (Fuel Consumption gallon per 1,000 ton-mile)
----------------------------------------------------------------------------------------------------------------
Urban........................................................         36.0511         25.3438            26.4244
Multi-Purpose................................................         32.4165         23.0845            22.5933
Regional.....................................................         28.5855         21.4145            18.5658
----------------------------------------------------------------------------------------------------------------
    NHTSA Standard for Vehicle with SI Engine Effective MY 2027 (Fuel Consumption gallon per 1,000 ton-mile)
----------------------------------------------------------------------------------------------------------------
Duty cycle                                                              Light          Medium
                                                                   heavy-duty      heavy-duty
                                                                   Class 2b-5       Class 6-7
                                                                                      (and C8
                                                                                    gasoline)
----------------------------------------------------------------------------------------------------------------
Urban........................................................         46.4724         33.4196
Multi-Purpose................................................         41.8589         30.1564
Regional.....................................................         35.8951         27.7934
----------------------------------------------------------------------------------------------------------------

    As with the other regulatory categories of heavy-duty vehicles, 
NHTSA and EPA are adopting standards that apply to Class 2b-8 
vocational vehicles at the time of production, and EPA is adopting 
standards for a specified period of time in use (e.g., throughout the 
regulatory useful life of the vehicle). The derivation of the standards 
for these vehicles, as well as details about the provisions for 
certification and implementation of these standards, are discussed in 
more detail in Sections V.C. and V.D and in the RIA Chapter 2.9.
(b) Custom Chassis Fuel Consumption and CO2 Standards
    The agencies proposed a simplified compliance procedure and less 
stringent standards for emergency vehicles, while requesting comment on 
extending these flexibilities to other custom chassis such as 
recreational vehicles and buses. 80 FR 40292-40293. As described below, 
the agencies are finalizing a broader allowance that will also apply 
for vehicles other than emergency vehicles.
    In response to the proposed provisions for emergency vehicles, we 
received comments in support of adopting separate, less stringent 
standards for emergency vehicles through a simplified GEM process. 
Based on the reasoning set forth at proposal, and supported in the 
public comments, these final rules include optional emergency vehicle 
standards based on the same technologies as described in the proposal, 
and using a simplified version of GEM available through the custom 
chassis program. The use of a default engine in GEM avoids penalizing 
emergency vehicle manufacturers from installing engines that are likely 
to be credit-using engines against the separate engine standard, and 
avoids forcing emergency vehicles to be measured against an un-
representative baseline over an un-representative drive cycle.
(i) Justification for an Expanded Custom Chassis Program
    In the proposal, we requested comment on other manufacturers who 
could benefit from a similar regulatory approach, such as those 
offering such a narrow range of products that averaging is not of 
practical value as a compliance flexibility, and for whom there are not 
large sales volumes over which to distribute technology development 
costs, as well as having drive cycles and functions that may make the 
primary standards either unrepresentative or unsuitable. Although this 
issue has some implications for our consideration of small business 
concerns, the custom chassis provisions discussed in the proposal were 
not intended to be limited to small businesses, and the final custom 
chassis standards are generally applicable (albeit optional). It is 
important to consider that for some vocational applications the custom-
chassis manufacturers can have substantial market share. For example, 
Blue Bird is a manufacturer of school buses and school bus chassis with 
a substantial market share of its narrow product line.
    We received comments in support of separate standards based on a 
different technology mix than the primary program for seven vocational 
vehicle applications. Gillig, New Flyer and Allison commented in 
support of separate standards for transit buses. RVIA, Newell Coach, 
Allison and Tiffin

[[Page 73687]]

Motor Homes commented in support of separate standards for motor homes. 
OshKosh commented in support of separate standards for cement mixers. 
Autocar and Volvo commented in support of separate standards for refuse 
trucks. Volvo and ABC Bus Companies commented in support of separate 
standards for motor coaches. Daimler and the School Bus Manufacturers 
Technical Council commented in support of separate standards for school 
buses.
    The agencies received favorable comment on using a simplified 
compliance procedure for custom chassis from most commenters, but some 
expressed concerns. Autocar claimed that the simplified GEM interface 
would not sufficiently reduce the administrative compliance burden of 
small businesses, and recommended an engine-only certification method.
    Custom chassis manufacturers that are not small businesses must 
comply with the Phase 1 standards and are generally doing so, by 
installing a mix of tires that, on average, meet the target coefficient 
of rolling resistance. Large manufacturers were not enthusiastic about 
offering a different approach for some vehicles, and urged that custom 
chassis standards, if adopted, be generally available as a compliance 
option. Based on public comment and extensive stakeholder outreach, the 
agencies have identified over a dozen chassis manufacturers serving the 
U.S. vocational market who produce a narrow spectrum of vehicles for 
which many technologies underlying the primary standards will either be 
less effective than projected, or are infeasible. Innovus commented 
that regulatory flexibility should only be offered to small volume 
producers who are also small entities. However, we do not believe it is 
warranted to force any of these specialized manufacturers to certify 
their narrow product line of vehicles to the primary standards, where 
stringency is premised on performance of some technologies unsuited for 
their specialized type of vehicle. Thus, the agencies have developed 
optional standards tailored for these vehicle types, and are not 
limiting eligibility to small entities.
    Any manufacturer may certify their vehicles that we have identified 
as custom chassis vehicles under the primary standards. We expect that 
diversified chassis manufacturers selling a small number of their 
products into these defined custom applications could likely meet the 
primary Phase 2 standards on average, using internal credits. However, 
because the baseline configurations and duty cycles for these custom 
applications would be less representative and some technologies would 
either be less effective or infeasible for them, these custom 
applications would likely be credit-using vehicles in the averaging 
set. Even so, we believe the primary Phase 2 standards are both 
feasible and appropriate for diversified manufacturers, as their broad 
mix of products allows them to average across their fleets, and some 
vehicles are likely to over-comply because their in-use applications 
are more compatible with the full range of available technologies. This 
is a feature of setting performance-based average standards with less 
than 100 percent adoption rates of technologies. Because we agree with 
commenters, including OshKosh who noted this is an expected market 
practice, we believe it is essential to not only set feasible targets 
for chassis manufacturers offering a narrow range of products and for 
whom fleet averaging will provide a smaller degree of compliance 
flexibility, but to also make this option available to diversified 
manufacturers. To address stakeholder concerns about large, diversified 
manufacturers having greater ability to produce credit-using vehicles 
than smaller, less diversified manufacturers, we are adopting 
additional flexibilities for manufacturers certifying to the custom 
chassis standards, including some flexibilities that will be available 
only for small businesses.
    We do not view these standards as achieving less improvement than 
the primary program for these vehicles, and thus, we are not adopting 
any sales limits. Nevertheless, we requested comments on an appropriate 
sales volume that might be considered as a criterion to qualify for the 
numerically less stringent standards, where vehicle quantities above 
such sales threshold would need to be certified to the primary 
standards. We received comments from Allison, Autocar, Innovus, the 
School Bus Manufacturers Technical Council, and RVIA suggesting 
appropriate low-volume thresholds ranging from 200 to 26,000 vehicles 
per year. We received adverse comment from Daimler stating it would be 
unfair to make less stringent standards available solely on the basis 
of sales volume, because if a technology exists for one manufacturer, 
it is available to all manufacturers. We received adverse comment from 
OshKosh that less stringent regulations on a limited production volume 
stifles a custom chassis manufacturers' opportunity to grow their 
business. For each of the applications listed below in Table V-10, the 
agencies have identified at least one manufacturer who produces chassis 
regulated under the Phase 2 program that are generally finished as a 
single vehicle type, as well as at least one competitor who is more 
diversified. After considering these comments, we continue to believe 
that no sales limits are needed.
    After considering the comments on possible separate standards for 
custom chassis, the agencies have evaluated the feasibility of 
technologies for these vehicles on an application-specific basis. We 
shared draft custom chassis technology packages with affected 
stakeholders and received feedback.\396\ See Section V.C.1.a below 
discussing the feasibility of each technology as it applies for custom 
chassis vehicles. Section V.C.(2)(b) discusses the technology adoption 
rates from which the stringency of the optional custom chassis 
standards are derived.
---------------------------------------------------------------------------

    \396\ See record of Webinar on Vocational Custom Chassis, March 
2016, Docket ID EPA-HQ-OAR-2014-0827-1944.
---------------------------------------------------------------------------

    Navistar commented with concerns that separate standards for custom 
chassis could create an unleveled playing field for manufacturers. 
ACEEE commented that the agencies should strengthen the primary 
vocational vehicle standard by one percent to offset the weaker 
standards for the custom chassis. ACEEE also commented that if chassis 
manufacturers can identify the vehicle application with enough 
specificity to take advantage of the custom chassis program, then they 
should also be able to take advantage of the most appropriate fuel-
saving technologies, resulting in target stringencies that are not 
weaker than the main program. Although we agree that the custom chassis 
program should not result in a weakening of the overall vocational 
program, we disagree with ACEEE's recommendation to arbitrarily add 
back stringency. The agencies did not remove custom chassis in the 
final stage of a feasibility analysis of the primary program; rather, 
we separately considered the custom chassis vehicles as an integral 
part of developing the feasibility analysis in support of the final 
standards. The optional final standards are technology-advancing, 
appropriate, and maximum feasible for these applications. No arbitrary 
offset is needed or justified.
    We disagree with claims made by commenters expressing concerns with 
respect to a shortfall or gap in emissions reductions between the 
primary vocational vehicle program and the custom chassis program. Some 
commenters have attempted to quantify

[[Page 73688]]

a difference in stringency by comparing select technology packages for 
custom chassis described in a February 2016 memorandum with the 
proposed technology packages for comparable subcategories.\397\ Because 
most of the baseline configurations for the custom chassis are tailored 
for each vocational vehicle, the only vehicle types where this 
comparison is straightforward is school buses and motor homes. In 
comparing the MY 2027 stringency of the medium heavy-duty Urban 
subcategory with the optional MY 2027 standard for school buses, for 
example, it can be seen that diesel vehicles in the primary program are 
projected to achieve 22 percent improvement on average, while school 
buses are expected to achieve 18 percent improvement on average. This 
is nowhere near the gap posited by certain commenters. Moreover, the 
difference in stringency reflects the reasonable conclusion that 
certain transmission technologies are not feasible for school buses.
---------------------------------------------------------------------------

    \397\ See memorandum dated February 2016 on Vocational Vehicle 
Technology Packages for Custom Chassis, Docket ID EPA-HQ-OAR-2014-
0827-1719.
---------------------------------------------------------------------------

    This comparison is not straightforward for motor coaches and other 
custom chassis types, however, because the baselines are different and 
the vehicle attributes are not similar. For example, our baseline 
configuration for coach buses includes a 350 hp 11-liter engine with a 
6-speed automatic transmission. However, the primary program includes a 
baseline for heavy heavy-duty Regional vehicles that is a weighted 
average of 95 percent with 455 hp 15-liter engine with 10-speed manual 
transmission and 5 percent with a 350 hp 11-liter engine with a 6-speed 
automatic transmission. Due to the difference in performance of these 
configurations in GEM, a non-diversified coach bus manufacturer may 
find its fleet significantly ``in the hole'' in the first year of this 
program due solely to baseline differences. As an example of a 
technology difference, we have determined that regular HHD Regional 
chassis may reasonably apply AES on average at a rate of 90 percent by 
MY 2027, whereas we find that AES is not feasible at all for a 
conventional coach bus. A diversified manufacturer choosing to certify 
a coach bus in the HHD-R subcategory to the primary standards is likely 
to need to apply other technologies or use credits from other types of 
vehicles to meet the standard on average. A non-diversified coach bus 
manufacturer would be unlikely to achieve the HHD-R primary program 
standard unless some very advanced technology is applied (at costs 
necessarily very different from those analyzed to be reasonable here). 
Therefore, we do not believe it is accurate to draw a comparison, as 
certain commenters maintained, between the HHD-R primary program 
stringency of 14 percent and the coach bus MY 2027 stringency of 11 
percent.
    Nonetheless, because these optional custom chassis standards are 
numerically less stringent than the primary Phase 2 vocational vehicle 
standards, the agencies are adopting a more restrictive approach to 
averaging, banking and trading (ABT), allowing averaging only within 
each subcategory for vehicles certified to these optional standards. 
Trading and banking will not be permitted except that small businesses 
certifying vehicles to these optional standards may use traded credits 
to comply. We are adopting these provisions to prevent generation of 
windfall credits against the less numerically stringent custom chassis 
standard. If a manufacturer wishes to generate tradeable credits from 
production of these vehicles, one or more families may be certified to 
the primary vocational vehicle standards.

             Table V-10--Custom Chassis Population Estimates
------------------------------------------------------------------------
                                      Percent of new
                                         MY 2018        Average VMT  in
         Application type               vocational       first year \a\
                                        population
------------------------------------------------------------------------
Coach (Intercity) Bus.............                  1             85,000
Motor Home........................                 13              2,000
School Bus........................                 10             14,000
Transit Bus.......................                  1             64,000
Refuse Truck......................                  3             34,000
Cement Mixer \b\..................                  1             16,000
Emergency Vehicle \c\.............                  1              6,000
------------------------------------------------------------------------
Notes:
\a\ Source: MOVES 2014 for all except mixer and emergency.\398\
\b\ Source for cement mixer is UCS.\399\
\c\ Source for emergency is ICCT (2009) \400\ and FAMA (2004).\401\

    As shown in Table V-10, some of these vehicle types are produced in 
moderate volumes, and some are driven moderate distances annually. 
However, those that are produced in slightly higher volumes (motor 
homes and school buses) are among those driven the fewest miles. 
Similarly, those driven the most miles (coach and transit buses) are 
among those produced in the smallest volumes. Collectively, the 
agencies estimate that the vehicles defined as custom vocational 
chassis in Phase 2 comprise less than 30 percent of the projected new 
vocational vehicle sales in MY 2018. Even so, because of the 
collectively small number of miles driven, the agencies believe that 
setting less numerically stringent GHG and fuel consumptions standards 
for these vehicles will not detract from the greater benefits of this 
rulemaking, and that such separate standards are warranted in any case.
---------------------------------------------------------------------------

    \398\ Vehicle populations are estimated using MOVES2014. More 
information on projecting populations in MOVES is available in the 
following report: USEPA (2015). ``Population and Activity of On-road 
Vehicles in MOVES2014--Draft Report'' Docket No. EPA-HQ-OAR-2014-
0827.
    \399\ National Ready Mixed Association Fleet Benchmarking and 
Costs Survey, http://www.nxtbook.com/naylor/NRCQ/NRCQ0315/index.php#/22, from UCS Custom Chassis Recommendations, May 2016.
    \400\ ICCT, May 2009, ``Heavy-Duty Vehicle Market Analysis: 
Vehicle Characteristics & Fuel Use, Manufacturer Market Shares.''
    \401\ Fire Apparatus Manufacturer's Association, Fire Apparatus 
Duty Cycle White Paper, August 2004, available at http://www.deepriverct.us/firehousestudy/reports/Apparatus-Duty-Cycle.pdf.
---------------------------------------------------------------------------

    As proposed and discussed in the RIA Chapter 12, the agencies are 
adopting a provision for chassis manufacturers qualifying as small 
businesses to have

[[Page 73689]]

one extra year of lead time to comply with the initial Phase 2 
standards.\402\ Daimler stated it only supported additional lead time 
if it was provided equally to all custom chassis manufacturers. Because 
the SBA threshold in this sector is generally 1,500 employees, we 
believe that small entities have fewer in-house resources to collect 
and analyze compliance data than do manufacturers with more employees. 
Due to these resource constraints, the agencies believe it is 
appropriate to offer this only to small businesses--the entities that 
need further lead time. However, many custom chassis manufacturers do 
not qualify as small entities under the SBA regulations. We received 
comment from OshKosh that additional time to meet an impossible 
stringency target is not helpful, a comment addressed by adopting the 
separate custom chassis standards. The final program offers both a 
feasible standard, as described below, and additional lead time for 
small businesses.
---------------------------------------------------------------------------

    \402\ See SBA regulations at 13 CFR 121.201. Thresholds 
effective February 2016 are available at http://www.regulations.gov/#!documentDetail;D=SBA-2014-0011-0031, 81 FR 4469.
---------------------------------------------------------------------------

    Vehicles certifying to the optional custom chassis standards will 
be simulated in GEM using a default EPA engine map as well as many 
other EPA default parameters that are required inputs for vehicles in 
the primary program. While this is very similar to the Phase 1 GEM, 
more inputs are available in the Phase 2 custom chassis program than in 
Phase 1. Section V.D.(1) below describes the regulatory subcategory 
identifiers that must be input to GEM to call default vehicle 
specifications as part of obtaining valid simulation results for custom 
chassis in GEM.
    The optional custom chassis standards will phase in over the same 
period as the primary vocational vehicle standards, beginning in the 
2021 model year. However, there are no intermediate standards in MY 
2024, so the optional MY 2021 custom chassis standards will continue 
until the full implementation year of MY 2027. The agencies have 
identified a technology path for each of these levels of improvement, 
as described below.
    Combining engine and vehicle technologies, custom chassis are 
projected to achieve improvements from 6 to 18 percent in MY 2027 over 
the MY 2017 baseline, as summarized in Table V-11. The incremental 
standard in MY 2021 will achieve improvements of up to 10 percent over 
the MY 2017 baseline vehicles when including improvements from MY 2021 
diesel engines, as shown in Table V-11.
    The agencies' analyses, summarized immediately below and discussed 
in detail in the RIA Chapter 2.9, show that these optional standards 
are justified under each agency's respective statutory authority. We 
note that for each model year of the Phase 2 custom chassis standards, 
the numerical value of the vehicle-level standard represents the 
performance of a diesel engine meeting that year's separate CI engine 
standard. Put another way, although the agencies are adopting distinct 
standards for custom chassis vocational vehicles, those vehicles must 
still use engines certified to the applicable Phase 2 engine standard. 
As in Phase 1, the chassis manufacturer is free to install any 
certified engine, and because GEM will run using a default map, the 
choice of engine will not affect the GEM result.

    Table V-11--Custom Chassis CO[ihel2] and Fuel Use Reductions (in
                       Percent) From 2017 Baseline
------------------------------------------------------------------------
                                                           Model year
                     Vehicle type                      -----------------
                                                          2021     2027
------------------------------------------------------------------------
Coach Bus.............................................        7       11
Motor Home............................................        6        9
School Bus............................................       10       18
Transit...............................................        7       14
Refuse................................................        4       12
Mixer.................................................        3        7
Emergency.............................................        1        6
------------------------------------------------------------------------

    It is worth noting that because the custom chassis version of GEM 
will not recognize certain technology improvements that some of these 
manufacturers will include based on market forces (after they have been 
introduced into the market as a result of the primary program), we 
expect actual in-use improvements for some of these vehicles to be 
slightly greater than is required by the standards. For example, we 
project that transmission manufacturers will improve the overall 
efficiency of their transmissions to enable vehicle manufacturers to 
comply with the primary standards. Once these transmissions have been 
developed and made available, we would not expect custom chassis 
manufacturers (or customers) to resist using them simply because they 
would not impact compliance with the standards.
(ii) GEM-Based Custom Chassis Standards
    Table V-12 and Table V-13 present EPA's CO2 standards 
and NHTSA's fuel consumption standards, respectively, for custom 
vocational chassis. The agencies have analyzed the technological 
feasibility of achieving the fuel consumption and CO2 
standards, based on projections of actions manufacturers may take to 
reduce fuel consumption and emissions to achieve the standards, and 
believe that the standards are technologically feasible throughout the 
regulatory useful life of the program. EPA and NHTSA describe costs of 
the custom chassis standards in Section V.C.(2). In all cases we expect 
the technology package costs to be less than those of the primary Phase 
2 standards, reflecting that the full set of technologies on which the 
stringency of the primary standards are based is not suitable for 
custom chassis applications. The costs of these standards are 
reasonable in the context of the reductions achieved, should be offset 
by fuel savings over the life of the vehicles.
    These custom vehicle-level standards are predicated on a simpler 
set of vehicle technologies than the primary Phase 2 standard for 
vocational vehicles. (As already noted, these custom chassis vehicles 
will be required to use engines meeting the Phase 2 engine standards, 
and thus, should generally incorporate the same engine improvements as 
other vocational vehicles). In developing these optional standards, the 
agencies have evaluated the current levels of fuel consumption and 
emissions, the kinds of technologies that could be utilized by custom 
chassis manufacturers to reduce fuel consumption and emissions, the 
associated lead time, the associated costs for the industry, fuel 
savings for the owner/operator, and the magnitude of the CO2 
reductions and fuel savings that may be achieved. After examining the 
possibilities of vehicle improvements, the agencies are basing the 
optional vehicle-level standards for motor homes on adoption of TPMS 
and low rolling resistance tires. We are basing the optional standards 
for transit buses and refuse trucks on the performance of workday idle 
reduction technologies, tire pressure systems, simplified transmission 
improvements, and further tire rolling resistance improvements. The 
agencies are basing the standards for coach buses and school buses on 
all of the above technologies as well as simplified transmission 
improvements. The agencies are basing the standards for concrete mixers 
and emergency vehicles on use of tires with current average levels of 
rolling resistance. The EPA-only air conditioning standard is based on 
leakage improvements. Of these technologies, we believe that improved 
tire rolling resistance, neutral idle, and air conditioning leakage 
improvements

[[Page 73690]]

are available today and may be adopted as early as MY 2021. As 
described in the RIA 2.9.3.4 and 2.9.5, the vehicle technology that we 
believe will benefit from more development time for engine and vehicle 
integration is stop-start idle reduction.
    EPA's custom chassis CO2 standards and NHTSA's fuel 
consumption standards for the full implementation year of MY 2027 
reflect even greater adoption rates of the same vehicle technologies 
considered as the basis for the MY 2021 standards, described in more 
detail in Section V.C below.
    As with the other regulatory categories of heavy-duty vehicles, 
NHTSA and EPA are adopting standards that apply to custom chassis 
vocational vehicles at the time of production, and EPA is adopting 
standards for a specified period of time in use (e.g., throughout the 
regulatory useful life of the vehicle). The derivation of the standards 
for these vehicles, as well as details about the provisions for 
certification and implementation of these standards, are discussed in 
more detail later in this document and in the RIA 2.9.3 to 2.9.6.
    The optional standards shown below were derived using baseline 
vehicle models with many attributes similar to those developed for the 
primary program, with adjustments that are described below in Section 
V.C.(2)(a). Details of these configurations are provided in the RIA 
Chapter 2.9.2. For better transparency with respect to the incremental 
difference between the MY 2021 and MY 2027 vehicle standards, we have 
modeled a certified MY 2027 engine for both vehicle model years of 
optional custom chassis standards. Thus, chassis manufacturers who do 
not make their own engines may compare the two model years of standards 
presented in Table V-12 and Table V-13 and know that any differences 
are due solely to vehicle-level technologies.

          Table V-12--EPA Emission Standards for Custom Chassis
                           [Gram CO2/ton-mile]
------------------------------------------------------------------------
                                                       MY 2021   MY 2027
------------------------------------------------------------------------
Coach Bus...........................................       210       205
Motor Home..........................................       228       226
School Bus..........................................       291       271
Transit.............................................       300       286
Refuse..............................................       313       298
Mixer...............................................       319       316
Emergency...........................................       324       319
------------------------------------------------------------------------


     Table V-13--NHTSA Fuel Consumption Standards for Custom Chassis
                       [Gallon per 1,000 ton-mile]
------------------------------------------------------------------------
                                                       MY 2021   MY 2027
------------------------------------------------------------------------
Coach Bus...........................................   20.6287   20.1375
Motor Home..........................................   22.3969   22.2004
School Bus..........................................   28.5855   26.6208
Transit.............................................   29.4695   28.0943
Refuse..............................................   30.7466   29.2731
Mixer...............................................   31.3360   31.0413
Emergency...........................................   31.8271   31.3360
------------------------------------------------------------------------

    The agencies are adopting definitional provisions for each of the 
custom chassis subcategories to ensure that only eligible chassis will 
be able to certify to these numerically less stringent standards. The 
category with the most diversity and the greatest need for regulatory 
clarification is refuse. We received comments from OshKosh that there 
are seven distinct types of refuse trucks, including roll-on-roll-off 
vehicles, type T container haulers (hauling trailers containing waste), 
as well as residential front loaders, side loaders, and rear loaders. 
After considering these comments and other available information, we 
have determined that refuse trucks that do not compact waste are 
ineligible to certify to the custom chassis standards. For example, 
roll-off trucks do not engage in neighborhood waste collection and 
typically transfer full containers to and from regional landfills and 
construction sites. Furthermore, their driving patterns are more likely 
to resemble our Regional cycle than the Urban cycle. These trucks do 
engage in some PTO operation while parked when loading or unloading 
waste containers using hydraulically operated beds and possibly a winch 
or other onboard lift system; however, they do not use the PTO while 
driving. The relevant definitions and certification provisions for 
refuse and other vehicle types are discussed below in Section V.D.
    As discussed above, we are not restricting the optional custom 
chassis program to small businesses, nor is there a production cap. 
Because we are allowing diversified manufacturers to certify some 
vehicles to the optional custom chassis standards, but some large 
manufacturers may not have a system for tracking what the final build 
of a vehicle is, we are adopting compliance procedures to assure that 
the final intended build will be one of the defined vehicle types. This 
approach is intended to level the playing field by allowing large 
manufacturers to choose this option where their tracking (and/or 
controls imposed on the vehicle) is sufficient to know at the time of 
certification what the final build will be. This avoids restricting 
this path to a small subset of manufacturers.
(iii) Design Standards for Select Custom Chassis
    The agencies are adopting an additional set of optional standards 
where manufacturers of motor home, cement mixer, and emergency vehicle 
chassis may elect to certify one or more families of vehicles to an 
equivalent standard. Certification would not require use of GEM if a 
manufacturer selects this option. Instead, certification using this 
option requires installation of specific technologies on every vehicle. 
This option does not allow any averaging, banking, or trading. These 
standards are equivalent in stringency to the GEM-based option for 
these three types of chassis. As mentioned above, the agencies received 
compelling public comment from Autocar suggesting that use of even the 
simplified GEM was unreasonably burdensome, and that further 
simplification was warranted in some cases. For small businesses 
especially, the certification burden of collecting data and running 
even a simplified version of GEM can present a disproportionally high 
burden, especially where there are very limited GEM inputs. Thus, the 
agencies sought to offer an option that minimizes the certification 
burden, recognizing the lesser complexity of the technology package 
associated with the standards for these chassis.
    These equivalent technology-based standards are not available for 
manufacturers of coach bus, school bus, transit bus, and refuse truck 
chassis, as the technology packages for these chassis are more complex 
and cannot be projected to be installed at 100 percent adoption rates.
    Table V-14 lists the technologies required to be applied to every 
vehicle sold by a manufacturer as part of a family certified to the 
optional non-GEM vocational vehicle standards. In addition, the vehicle 
must have a certified Phase 2 engine and comply with the separate 
standard to prevent leakage of HFC from the mobile air conditioning 
system. The combined tire CRR values shown in the table are obtained 
using Equation V-1.

Equation V-1 Vocational Tire CRR Level Formula
Steer tire CRR x 0.3 + Drive tire CRR x 0.7

    Although manufacturers choosing this option will not have access to 
the

[[Page 73691]]

heavy-duty ABT program, this formula provides a small degree of freedom 
to allow for some product variability while meeting the target for 
every vehicle.

             Table V-14--Optional Design (Non-GEM) Standards
------------------------------------------------------------------------
                                          Required technology
        Vehicle type         -------------------------------------------
                                     MY 2021               MY 2027
------------------------------------------------------------------------
Motor Home..................  Combined CRR 6.7 kg/  Combined CRR 6.0 kg/
                               ton or less, and      ton or less, and
                               either TPMS or ATIS.  either TPMS or
                                                     ATIS.
Emergency...................  Combined tire CRR     Combined tire CRR
                               8.7 kg/ton or less.   8.4 kg/ton or less.
Mixer.......................  Combined tire CRR     Combined tire CRR
                               7.6 kg/ton or less.   7.1 kg/ton or less.
------------------------------------------------------------------------

(c) HFC Leakage Standards
    The Phase 1 GHG standards do not include standards to control 
direct HFC emissions from air conditioning systems on vocational 
vehicles. EPA deferred such standards due to ``the complexity in the 
build process and the potential for different entities besides the 
chassis manufacturer to be involved in the air conditioning system 
production and installation,'' See 76 FR 57194. During our stakeholder 
outreach conducted for Phase 2, we learned that the majority of 
vocational vehicles are sold as cab-completes with the dashboard-
mounted air conditioning systems installed by the chassis manufacturer. 
For those vehicles that have A/C systems installed by a second stage 
manufacturer, EPA is adopting revisions to our regulations that resolve 
the issues identified in Phase 1, in what we believe is a practical and 
feasible manner, as described below in Section V.D.2.
    EPA received comments generally supportive of adoption of A/C 
refrigerant leakage standards for Class 2b-8 vocational vehicles, 
beginning with the 2021 model year. Chassis sold as cab-completes 
typically have air conditioning systems installed by the chassis 
manufacturer. For these configurations, the process for certifying that 
low leakage components are used will follow the system in place 
currently for comparable systems in tractors. In the case where a 
chassis manufacturer will rely on a second stage manufacturer to 
install a compliant air conditioning system, the chassis manufacturer 
must follow the certifying manufacturer's installation instructions to 
ensure that the final vehicle assembly is in a certified configuration.
(3) Exemptions and Exclusions
    This section describes exemptions and exclusions related to 
vocational vehicles, including some that are available only in Phase 1 
and some on which we asked for comment but did not adopt in the final 
program.
(a) Small Business Flexibilities
    Although the Phase 1 program deferred the requirements for small 
businesses, the Phase 2 program will require small businesses to 
certify their affected vehicles. The RIA Chapter 12 presents a complete 
discussion of the outreach process that EPA conducted to solicit input 
from small businesses on the Phase 2 program. The RIA Chapter 12 
explains why the agencies are adopting one year of additional lead time 
for all small businesses in Phase 2. Thus, the first compliance year 
for small entities is MY 2022 rather than MY 2021. The Small Business 
Advocacy Review Panel included representatives who produce vocational 
vehicle chassis, including emergency vehicles and concrete mixers. 
Discussions specific to vocational vehicle chassis during that process 
included exploration of a low volume production threshold below which 
some manufacturers may avoid some obligations of this regulation. 
Consistent with the recommendations of the Panel, the agencies 
requested comments on how to design a small business vocational vehicle 
program, including comments on a possible small volume threshold below 
which some small business exemption may be available.\403\ Innovus 
commented in support of a small volume threshold for vocational small 
businesses of either 200 vehicles per year or a different threshold set 
based on the market share of the entity. We received comments from 
Allison, Autocar, the School Bus Manufacturers Technical Council, and 
RVIA each suggesting different low-volume vocational chassis thresholds 
ranging as high as 26,000 vehicles per year. We received adverse 
comment from Daimler stating it would be unfair to make less stringent 
standards available solely on the basis of sales volume, because if a 
technology exists for one manufacturer, it is available to all 
manufacturers. We received adverse comment from OshKosh that less 
stringent regulations on a limited production volume stifles a custom 
chassis manufacturers' opportunity to grow their business. Upon 
consideration of these comments, the agencies are not finalizing a 
broad sales volume threshold below which a vocational chassis 
manufacturer may reduce their compliance burden. Instead we are 
adopting the custom chassis program, and we are revising some of the 
exemptions that are carrying forward from Phase 1.
---------------------------------------------------------------------------

    \403\ See proposed rules at 80 FR 40295, July 13, 2015.
---------------------------------------------------------------------------

    Autocar requested further consideration of the small business 
concerns of manufacturers of specialty vehicle applications, 
specifically recommending a low volume threshold if the agencies are 
not inclined to use a manufacturer's business size as grounds for an 
exemption. Examples of specialty vehicles listed by Autocar include 
street sweepers, asphalt blasters, aircraft deicers, sewer cleaners, 
and concrete pumpers. Innovus also requested additional flexibility for 
meeting OBD requirements. Capacity Trucks commented that the terminal 
tractor industry is primarily comprised of small businesses who produce 
a total of less than 6,000 terminal tractors per year, 70 percent of 
which are fully off-road vehicles. See Section V.B.(3)(c) for a 
discussion of how we are addressing Innovus' comment. See the 
discussion in Section V.B.(3)(b) for a discussion of how we are 
addressing the comments on vehicles that are off-road and low-speed.
(b) Off-Road and Low-Speed Vocational Vehicle Exemptions
    In considering the above comments regarding additional vehicles 
that have significant operation at low speeds or off-road, the agencies 
are revising the exemptions adopted in Phase 1 for off-road and low-
speed vocational vehicles at 40 CFR 1037.631 and 49 CFR 523.2. See 
generally 76 FR 57175.
    These provisions already apply in Phase 1 for vehicles that are 
defined as ``motor vehicles'' per 40 CFR 85.1703, but may conduct most 
of their operations off-road, such as drill rigs, mobile cranes and 
yard hostlers.

[[Page 73692]]

Vehicles qualifying under these provisions must be built with engines 
certified to meet the applicable engine standard, but need not comply 
with a vehicle-level GHG or fuel consumption standard. To date, 
according to EPA records, vehicles exempted under this provision using 
the axle rating criterion included airport fire apparatus, airport 
service, fire service, oil field service, utility repair, refuse, and 
truck crane. Only two vehicles were exempted using the 45 mph speed 
criterion, however those also had rear axles with GAWR of 29,000 lbs. 
No vehicles were exempted under this provision using the 33 mph 
criterion. Two manufacturers exempted several vehicles under this 
provision using the 55-mph speed-limited tire criterion, including oil 
field, mining, construction, rock body, and fertilizer spreader 
applications.\404\ RMA commented that the agencies should not 
discontinue the speed-limited tire exemption criterion, as was 
proposed. However, their argument that it would be detrimental for a 
vehicle to drive above 55 mph with speed-limited tires is not 
compelling. It is too easy for a vehicle to be sold with speed-limited 
tires and subsequently have replacement tires fitted that are 
appropriate for higher speed operation. Although we are discontinuing 
the criterion for exemption based solely on use of tires with maximum 
speed rating at or below 55 mph, we are adding a new criterion whereby 
a vehicle qualifies to be exempted under this provision if it would 
exceed 95 percent of maximum engine test speed when traveling at 54 mph 
or with tamper-proof equivalent electronic controls. We are retaining 
the qualifying criteria related to design and use of the vehicle.
---------------------------------------------------------------------------

    \404\ See memorandum dated July 2016 with data on exempted off-
road vocational vehicles.
---------------------------------------------------------------------------

    In considering the long list of specialty vehicle types raised by 
Capacity, Autocar and others, the agencies note that many of these may 
be primarily off-road vehicles in many respects, although some may not 
qualify as either off-road or low-speed under our regulations. In 
considering the drive cycle of those whose primary purpose is to 
transport an affixed device to an off-road work site for extended PTO 
operation, the agencies have concluded that the technologies we have 
determined to be feasible for concrete mixers are also feasible for 
this type of vehicle, and thus we are adopting a flexibility where 
vocational chassis that meet one of the two sets of criteria at 40 CFR 
1037.631(a) (but not both) may be optionally certified under the custom 
chassis program to the standards established for concrete mixers. These 
technologies include certified engines, low-leakage air conditioning 
components, and by MY 2027, steer tires with level 3V rolling 
resistance and drive tires with level 2v rolling resistance. We have 
similarly determined these technologies are feasible and reasonable to 
apply for vehicles whose primary purpose is to conduct work at slow 
speeds, but do not have affixed devices designed to be used at off-road 
work sites. This may include street sweepers and some terminal 
tractors.
    We interpret the comments from Capacity to mean that many terminal 
tractors are produced in very small volumes by a large number of non-
diversified small businesses. This is corroborated by comments from 
Autocar. Based on data from EPA's Smartway program, the drive cycles of 
some port drayage tractors can include a significant amount of highway 
time as well as idle time. According to available records, the average 
fraction of highway operation of 1,740 participating port dray tractors 
was 59 percent, and the average annual idle time was 762 hours.\405\ In 
considering this drive cycle information along with vehicle attributes, 
the agencies have determined that workday idle reduction technologies, 
transmission technologies, low rolling resistance tires, and other 
technologies factored into the primary vocational vehicle standards are 
feasible for drayage tractors that are not speed-limited. Therefore, 
the agencies believe that a standard reflecting performance of this 
type of technology package has potential applicability for this subset 
of drayage tractors. There is a competing consideration, however. As 
discussed above regarding our justifications for an expanded custom 
chassis program, we believe it is essential to set feasible targets for 
those chassis manufacturers who offer a narrow range of products. This 
is because fleet averaging provides a smaller degree of compliance 
flexibility for such manufacturers. Therefore we have determined that 
some type of alternative standard is warranted for non-diversified 
manufacturers who produce non-speed-limited drayage tractors. The 
transit bus custom chassis subcategory has a baseline with 
characteristics reasonably similar to drayage tractors, and is 
predicated on use of some but not all of the technologies that are 
feasible for drayage tractors. The agencies are adopting this as an 
alternative standard for non-speed-limited drayage tractors, with one 
caveat. We are concerned that offering an optional standard based on 
adoption of fewer technologies than are actually feasible for drayage 
tractors could result in a loss of emission reductions that are 
technically feasible. To address this concern, the agencies are 
limiting the number of non-speed-limited drayage tractors that may be 
certified under the alternative standard.\406\ As stated above in 
Section V.B.(3)(a), Innovus commented that 200 vehicles per year would 
be an appropriate small volume threshold. Further, Autocar's written 
comments as well as information provided during follow-up meetings 
indicate that this threshold would accommodate their production of non-
speed-limited drayage tractors. Therefore the agencies are adopting a 
flexibility exclusively for small businesses to optionally certify up 
to 200 drayage tractors annually under the custom chassis program to 
the standards established for transit buses. Otherwise manufacturers 
may elect to either certify their drayage tractors to the primary 
standards or design them to satisfy the eligibility criteria of 40 CFR 
1037.631 (i.e., to be speed-limited). We are adopting this as an 
interim provision (although there is no automatic sunset) to allow 
small businesses time to develop experience in the certification 
process as well as to develop future product plans.
---------------------------------------------------------------------------

    \405\ See memorandum dated July 2016 titled, ``Summary of 
SmartWay Port Dray 2014 Data''.
    \406\ See Note 403, above.
---------------------------------------------------------------------------

(c) Specialty Vehicle Exemption
    As described in Section XIII of this Preamble, the agencies are 
adopting alternate engine standards for specialty vehicles as part of 
the final Phase 2 program. Because some vocational vehicles may have 
engines certified under these specialty vehicle provisions found at 40 
CFR 1037.605, we are clarifying here how these provisions interact. 
According to the regulations at 40 CFR 1037.605, a manufacturer may 
produce no more than 1,000 hybrid vehicles in a single model year under 
this option, and no more than 200 amphibious vehicles, speed-limited 
vehicles, or all-terrain vehicles. Under this provision, speed-limited 
vehicles are those that cannot exceed 45 mi/hr by tamper-proof 
calibration. Only vehicles with hybrid drivetrains that certify engines 
under this provision must also have a vehicle-level Phase 2 
certificate, as required under 40 CFR 1037.105. The three other types 
would be exempt from the vehicle standards. Depending on the 
manufacturer and vehicle type, this may mean that such hybrid vehicles 
may need to meet the primary vocational

[[Page 73693]]

vehicle standards or one of the custom chassis standards.

C. Feasibility of the Vocational Vehicle Standards

    This section describes the agencies' technological feasibility and 
cost analysis. Further detail on all of these technologies can be found 
in the RIA Chapter 2.4 and Chapter 2.9. The variation in the design and 
use of vocational vehicles has led the agencies to project different 
technology solutions for each regulatory subcategory. Manufacturers may 
also find additional means to reduce emissions and lower fuel 
consumption than the technologies identified by the agencies, and of 
course may adopt any compliance path they deem most advantageous. This 
section includes discussion of the feasibility of the final standards 
for non-custom vocational vehicles using the full Phase 2 certification 
path, as well as the final optional standards for custom chassis 
standards.
    NHTSA and EPA collected information on the cost and effectiveness 
of fuel consumption and CO2 emission reducing technologies 
from several sources. The primary sources of information were the 
Southwest Research Institute evaluation of heavy-duty vehicle fuel 
efficiency and costs for NHTSA,\407\ the 2010 National Academy of 
Sciences report of Technologies and Approaches to Reducing the Fuel 
Consumption of Medium- and Heavy-Duty Vehicles,\408\ TIAX's assessment 
of technologies to support the NAS panel report,\409\ the technology 
cost analysis conducted by ICF for EPA,\410\ and the 2009 report from 
Argonne National Laboratory on Evaluation of Fuel Consumption Potential 
of Medium and Heavy Duty Vehicles through Modeling and Simulation.\411\
---------------------------------------------------------------------------

    \407\ Reinhart, T. (February 2016). Commercial Medium- and 
Heavy-Duty (MD/HD) Truck Fuel Efficiency Technology Study--Report 
#2. Washington, DC: National Highway Traffic Safety Administration. 
EPA-HQ-OAR-2014-0827-1623.; and Schubert, R., Chan, M., Law, K. 
2015, Commercial Medium- and Heavy-Duty (MD/HD) Truck Fuel 
Efficiency Cost Study. Washington, DC: National Highway Traffic 
Safety Administration.
    \408\ See NAS Report, Note 229 above.
    \409\ See TIAX 2009, Note 230 above.
    \410\ See ICF 2010, Note 232 above.
    \411\ Argonne National Laboratory, ``Evaluation of Fuel 
Consumption Potential of Medium and Heavy Duty Vehicles through 
Modeling and Simulation.'' October 2009.
---------------------------------------------------------------------------

(1) What technologies are the Agencies considering to reduce the 
CO2 emissions and fuel consumption of vocational vehicles?
    In assessing the feasibility of the final Phase 2 vocational 
vehicle standards, the agencies evaluated a suite of technologies, 
including workday idle reduction, improved tire rolling resistance, 
tire pressure monitoring or inflation systems, improved transmissions 
including hybrids, improved axles, improved accessories, and weight 
reduction, as well as their impact on reducing fuel consumption and GHG 
emissions. The agencies also evaluated aerodynamic technologies and 
full electric vehicles.
    As discussed above, vocational vehicles may be powered by either SI 
or CI engines. The technologies and feasibility of the engine standards 
are discussed in Section II. At the vehicle level, the agencies have 
considered the same suite of technologies and have applied the same 
reasoning for including or rejecting these vehicle-level technologies 
as part of the basis for the final standards, regardless of whether the 
vehicle is powered by a CI or SI engine, since the vehicle level 
technologies are not a function of engine type. Generally, the analysis 
below does not distinguish between vehicles with different types of 
engines. The resulting vehicle standards do reflect the differences 
arising from the performance of CI (primarily diesel) or SI (primarily 
gasoline) engines over the GEM cycles. Note that vehicles powered by 
engines using fuels other than diesel or gasoline are subject to either 
the SI or CI vehicle standards, as specified in 40 CFR 1037.101.
(a) Vehicle Technologies Considered in Standard-Setting
    The agencies note that the effectiveness values estimated for the 
technologies have been obtained using a variety of methods, including 
average literature values, engineering calculation, and GEM simulation. 
They do not reflect the potentially-limitless combination of possible 
values that could result from adding the technology to different 
vehicles. For example, while the agencies have estimated an 
effectiveness of one percent for e-accessories, each vehicle could 
experience a unique effectiveness depending on the actual accessory 
load for that vehicle. On-balance the agencies believe this is the most 
practicable approach for determining effectiveness for the technologies 
in the Phase 2 vocational vehicle program. This section is organized to 
first present the agencies' analyses of technology feasibility and 
effectiveness in Section V.C.(1), and below in Section V.C.(2) we 
present our projected technology adoption rates and estimated costs. 
Where other details are not given, the feasibility sections set forth 
our rationale for the projected adoption rates. Average vehicle 
technology package costs by regulatory subcategory are presented below 
in Section V.C.(2)(e). Individual technology costs are summarized in 
the RIA Chapter 2.9.3, and full details behind all these costs are 
presented in RIA Chapter 2.11, including the markups and learning 
effects applied for each of the technologies.
(i) Transmissions
    Transmission improvements present a significant opportunity for 
reducing fuel consumption and CO2 emissions from vocational 
vehicles. Transmission efficiency is important for all vocational 
vehicles as their duty cycles involve significant amounts of driving 
under transient operation. Even Regional vocational vehicles have 20 
percent of their composite score based on the transient test cycle. The 
three categories of transmission improvements the agencies proposed to 
consider as part of a compliance path used to determine standard 
stringency were driveline optimization, architectural improvements, and 
hybrid powertrain systems. As a result of comments and enhanced 
capabilities of GEM, we are adopting standards based on performance of 
a revised set of transmission technologies. For each technology, we 
have adjusted our projected penetration rates where we found that 
comments provided a persuasive reason to do so, and the effectiveness 
values are all updated according to the current GEM over the new drive 
cycle weightings.
    The technology we described at proposal as driveline integration, 
80 FR 40296, is now defined as use of an advanced shift strategy. At 
proposal the agencies included shift strategy, aggressive torque 
converter lockup, and a high efficiency gearbox among the technologies 
defined as driveline integration that would only be recognized by use 
of powertrain testing. We also proposed a 70 percent adoption rate in 
MY 2027 on the basis that this approach to improving fuel efficiency is 
highly cost-effective and technically feasible in a wide range of 
applications, and that the additional lead time would enable 
manufacturers to overcome barriers related to the non-integrated nature 
of businesses serving this sector. We received persuasive comments from 
manufacturers emphasizing the diversity of their product lines and the 
extent of testing that would be needed to apply this technology to 70 
percent of their sales, and as a result we have reduced our projected 
adoption rates for this technology. The agencies continue to believe 
that an effective way to derive

[[Page 73694]]

efficiency improvements from a transmission is by optimizing it with 
the engine and other driveline components to balance both performance 
needs and fuel savings. One example of an engine manufacturer 
partnering with a transmission manufacturer to achieve an optimized 
driveline is the SmartAdvantage powertrain.\412\ The agencies project 
transmission shift strategies, including those that make use of 
enhanced communication between engine and driveline, can yield 
efficiency improvements ranging from three percent for Regional 
vehicles to nearly six percent for Urban vehicles, using engineering 
calculations (see RIA 2.9.3.1) to estimate the benefits that can be 
demonstrated over the powertrain test. We received comment that we had 
poorly defined the technology that can bring about improvements related 
to drive line integration. In considering the comments and available 
information, we believe it is reasonable to project that transmissions 
may feature advanced shift strategies where they make use of an 
additional sensor to improve fuel efficiency such as by detecting 
payload or road grade. See Section V.D.(1) and the RIA Chapter 3.6 for 
a discussion of the powertrain test procedure.
---------------------------------------------------------------------------

    \412\ See Cummins-Eaton partnership at http://smartadvantagepowertrain.com/.
---------------------------------------------------------------------------

    The agencies have revised the GEM simulation tool to recognize 
additional transmission technologies beyond what was possible at the 
time of proposal. We are adopting a transmission efficiency test to 
recognize improved mechanical gear efficiency and reduced transmission 
friction, where the test results can be submitted as GEM inputs to 
override the default efficiency values. Because this test can be 
conducted with a bare transmission without needing to be paired with an 
engine, each test will be valid for a much broader range of vehicle 
configurations than for a powertrain test. The agencies project vehicle 
fuel efficiency can be improved by up to one percent from improved 
transmission gear efficiency, which we are projecting to be the same 
during each of the driving cycles and zero while idling. RIA 2.9.3.1.1. 
Actual test results are likely to show that some gears have more room 
for improvement than others, especially where a direct drive gear is 
already highly efficient. Commenters requested that the minimum torque 
converter lockup gear be enabled as a GEM input without requiring 
powertrain testing. In response, final GEM also requires an input field 
for torque converter lockup gear. The baseline configurations with 
automatic transmissions were run in GEM using lockup in third gear. The 
agencies project vehicle fuel efficiency can be improved up to three 
percent on a cycle average for torque converter lockup in first gear. 
RIA 2.9.3.1.1. Using the library of agency transmission files, GEM 
gives a different effectiveness value in every subcategory, because 
this is influenced by the gear ratios, drive cycle, and torque 
converter specifications. Manufacturers will obtain slightly different 
results with their own driveline specifications. The RIA at Chapter 
2.9.3.1 includes a table that summarizes the various effectiveness 
values for different types of transmission improvements.
    Although not factored into our stringency calculations, other non-
hybrid transmission technologies that can also be recognized by 
powertrain testing include use of architectures not recognized by GEM 
such as dual clutch systems, and designs with reduced parasitic losses.
    Most vocational vehicles currently use torque converter automatic 
transmissions (AT), especially in Classes 2b-6. Automatic transmissions 
offer acceleration benefits over drive cycles with frequent stops, 
which can enhance productivity. With the diversity of vocational 
vehicles and drive cycles, other kinds of transmission architectures 
can meet customer needs, including automated manual transmissions 
(AMT), dual clutch transmissions (DCT), as well as manual transmissions 
(MT).\413\ As at proposal, dual clutch transmissions are simulated as 
AMT's in GEM. A manufacturer may elect to conduct powertrain testing to 
obtain specific improvements for use of a DCT. The RIA Chapter 4 
explains the EPA default shift strategy and the losses associated with 
each transmission type, and discusses changes that have been made since 
proposal. Although the representation of transmissions has improved 
since proposal, the differences between AT and AMT are too difficult to 
isolate for purposes of figuring this into our stringency calculations. 
Although we expect manufacturers to have a reasonable model of 
transmission behavior for certification purposes, we could not estimate 
relative improvement values between AT and AMT for vocational vehicles 
using any defensible estimation method. The agencies have not been able 
to obtain conclusive data that could support a final vocational vehicle 
standard, in any subcategory, predicated on adoption of an AMT or DCT 
with a predictable level of improvement over an AT. As a result, the 
only architectural changes on which the final vocational vehicle 
standards are based are increasing the number of gears and automation 
compared with a manual transmission.
---------------------------------------------------------------------------

    \413\ See http://www.truckinginfo.com/channel/equipment/article/story/2014/10/2015-medium-duty-trucks-the-vehicles-and-trends-to-look-for/page/3.aspx (downloaded November 2014).
---------------------------------------------------------------------------

    The benefit of adding more gears varies depending on whether the 
gears are added in the range where most operation occurs. The TIAX 2009 
report projected that 8-speed transmissions could incrementally reduce 
fuel consumption by 2 to 3 percent over a 6-speed automatic 
transmission, for Class 3-6 box and bucket trucks, refuse haulers, and 
transit buses.\414\ We have run GEM simulations comparing 5-speed, 6-
speed, 7-speed, and 8-speed automatic transmissions where some cases 
hold the total spread constant, some hold the high end ratio constant, 
and some hold the low-end ratio constant, where all cases use a third 
gear lockup and axle ratios are held constant. We have observed mixed 
results, with some improvements over the highway cruise cycles as high 
as six percent, and some cases where additional gears increased fuel 
consumption. As proposed, we are allowing GEM to determine the 
improvement, where manufacturers will enter the number of gears and 
gear ratios and the model will simulate the efficiency over the 
applicable test cycle. The agencies have revised GEM based on comment, 
and we are confident that it fairly represents the fuel efficiency of 
transmissions with different gear ratios. Consistent with literature 
values, we are using engineering calculations to estimate that two 
extra gears has an effectiveness of one percent improvement during 
transient driving and two percent improvement during highway driving. 
Weighting these improvements using our final composite duty cycles 
(zero improvement at idle), for purposes of setting stringency, we are 
conservatively estimating that adding two gears will improve vocational 
vehicle efficiency between 0.9 and 1.7 percent.
---------------------------------------------------------------------------

    \414\ See TIAX 2009, Table 4-48.
---------------------------------------------------------------------------

    The final Phase 2 GEM has been calibrated to reflect a fixed two 
percent difference between manual transmissions and automated 
transmissions during the driving cycles (zero at idle). As in the HHD 
Regional subcategory baseline, manual transmissions simulated in GEM 
perform two percent worse than similarly-geared AMT. This fixed

[[Page 73695]]

improvement is discussed further in the RIA Chapter 2.4.
    Hybrid powertrain systems are included under transmission 
technologies because, depending on the design and degree of 
hybridization, they may either replace a conventional transmission or 
be deeply integrated with a conventional transmission. Further, these 
systems are often manufactured by companies that also manufacture 
conventional transmissions.
    The agencies are including hybrid powertrains as a technology on 
which some of the vocational vehicle standards are predicated. We 
proposed ten percent overall adoption of strong hybrids by MY 2027, 
which meant approximately 18 percent adoption in the Multipurpose and 
Urban subcategories in that model year. 80 FR 40297. We received 
extensive comments on the ability of the vocational vehicle market to 
adopt hybrid drivetrains. EDF and Parker both highlighted the 
successful demonstrations of Parker hydraulic hybrids for refuse 
applications with effectiveness near 40 percent over refuse duty 
cycles. Autocar commented that a significant portion of their refuse 
truck sales have hydrostatic hybrid drives. Fleets such as Pepsico and 
the City of Bloomington highlighted that they are actively purchasing 
hybrids. ATA and UPS commented that hybrid technology applications 
continue to be of interest to the trucking industry, but expressed 
concern over the high costs that can deter uptake in the market. Eaton 
commented that a combination of factors is needed to re-ignite the 
hybrid business: lower battery costs and increased efficiency of the 
hybrid systems for Class 6-8, lower cost mild hybrid powertrains in 
Class 3-5, and continued regulatory pull. Eaton says the hybrid market 
is still very fragile and they do not see market conditions improving 
for hybrid commercial vehicles except for a few mild hybrids. Securing 
America's Future Energy and ACEEE also commented in favor of including 
mild hybrids as part of the vocational vehicle compliance package.
    After considering all these comments, we agree with commenters that 
mild hybrids are more likely than strong hybrids to succeed initially 
in the vocational sector, especially outside of the bus market. We are 
projecting adoption of two types of mild hybrids, defined using system 
parameters based on actual systems commercially available in the market 
today.\415\ NTEA and the Green Truck Association both commented that a 
common way that today's hybrids are installed is by secondary or 
intermediate manufacturers. We have taken this into consideration by 
assuming that some mild hybrid systems will be integrated with an 
engine sufficient to enable use of an engine stop-start feature, while 
some mild hybrids will not be integrated and these ``bolt-on'' systems 
will only provide transient benefits related to regenerative braking.
---------------------------------------------------------------------------

    \415\ For example, see XL Hybrids at http://www.xlhybrids.com/content/assets/Uploads/XL-BoxTruck-US-FLY-8.5x11-0519-LR.pdf, and 
Crosspoint Kinetics at http://crosspointkinetics.com/members/kinetics-hybrid-partners/.
---------------------------------------------------------------------------

    Allison believes that hybrid vehicles should be certified on a duty 
cycle on the same basis as non-hybrid vehicles because the vehicles 
must perform the same work regardless of the powertrain technology. We 
agree and the Phase 2 test cycles are the same for conventional and 
hybrid drivelines. The Sierra Club asked the agencies to consider real 
world duty cycle data to account for the effectiveness of hybrids for 
vocational vehicles. Allison says investments for heavy-duty hybrids 
will be made by component suppliers, not by the vehicle manufacturers. 
The battery, inverter, and motor suppliers must make investments in 
addition to the system supplier. In this regard--for a small market 
like the heavy-duty hybrids--a significant investment, under current 
conditions, are seen as risky and unlikely to occur according to 
Allison. Allison commented that even though the transit bus industry 
has had commercially available hybrids for over a decade, the adoption 
rate of hybrids in the U.S. transit bus market is only 13.2 percent and 
that to achieve an overall 5 percent adoption rate of hybrid 
technology, the economics of the hybrid ownership would have to 
substantially change over the period of time covered by this 
rulemaking. In light of these concerns, we have adjusted our projected 
adoption rates of hybrid technology as described below in Section 
V.C.(2)(b)(i).
    We also have reconsidered our effectiveness estimation method as a 
result of comments. Instead of relying on previously published road 
tests over varying drive cycles, we are applying engineering 
calculations to account for defined hybrid system capacities and 
inefficiencies over our certification test cycle. We are using a 
spreadsheet model that calculates the recovered energy of a hybrid 
system using road loads of the default baseline GEM vehicles over the 
ARB Transient test cycle. See RIA Chapter 2.9.3.1.3 to read more about 
the assumed motor and battery capacity, swing in the state of charge, 
and system inefficiencies. The effectiveness is assumed 
(conservatively) to be zero for the highway cruise cycles to obtain the 
projected cycle-weighted effectiveness. For the non-integrated models, 
the same system was assessed for all weight classes (not scaled up for 
heavier vehicles); however, for the integrated models with stop-start 
we have scaled up the system specifications to account for the larger 
road loads, to ensure the projected effectiveness is not decreased for 
systems on heavier vehicles relative to that projected for lighter 
vehicles.
    For the non-integrated mild hybrids, we are estimating an eight to 
13 percent fuel efficiency improvement as measured over the powertrain 
test, depending on the duty cycle (i.e. Multi-purpose or Urban) in GEM 
for the applicable subcategory. See RIA 2.9.3.1. For the integrated 
mild hybrids, we have combined the effectiveness calculated for the 
scaled-up mild hybrid system with the effectiveness of stop-start, 
described below. Id. 2.9.3.1. These combined effectiveness values range 
from 18 to 21 percent efficiency improvement, depending on the duty 
cycle (i.e. Multi-purpose or Urban). Even though the actual improvement 
from hybrids in Phase 2 will be evaluated using the powertrain test, 
because the model uses the same vehicle test cycle and conservative 
estimates of realistic configurations, the agencies have concluded it 
is reasonable to use these spreadsheet-based estimates as a basis for 
setting stringency in the final rules.
    Based on the public comments from hybrid suppliers and other 
innovators providing evidence of hybrid systems in the market today 
ranging from prototypes to commercialized, the agencies believe the 
Phase 2 rulemaking timeframes will offer sufficient lead time to 
develop, demonstrate, and conduct reliability testing for hybrid 
technologies to enable market adoptions in the range that we are 
projecting for the final rules.
    The agencies are working to reduce barriers related to hybrid 
vehicle certification. In Phase 1, there is a significant burden 
associated with the optional test for demonstrating the GHG and fuel 
efficiency performance of vehicles with hybrid powertrain systems. If 
manufacturers wish to earn Phase 1 credit for a hybrid, they must 
obtain a conventional vehicle that is identical to the hybrid vehicle 
in every way except the transmission, test both, and compare the 
results.\416\ In Phase 2,

[[Page 73696]]

manufacturers will conduct powertrain testing on the hybrid system 
itself, and the results of that testing will become inputs to GEM for 
simulation of the non-powertrain features of the hybrid vehicle, 
removing a significant test burden. We will continue to work with 
hybrid suppliers and manufacturers to address other test burden issues, 
including test procedures to determine a balanced state of charge and 
number of default configurations needed for the cycle average map.
---------------------------------------------------------------------------

    \416\ See test procedures at 40 CFR 1037.555. In Phase 1, 
evaluation of hybrid powertrain systems is an option for which 
advanced technology credits are available.
---------------------------------------------------------------------------

    Hybrid manufacturers commented that meeting the on-board diagnostic 
requirements for criteria pollutant engine certification continues to 
be a potential impediment to adoption of hybrid systems. See Section 
XIII.A.1 for a discussion of regulatory changes to reduce the non-GHG 
certification burden for engines paired with hybrid powertrain systems. 
The agencies have also received comments on a letter from the 
California Air Resources Board requesting consideration of supplemental 
NOX testing of hybrids.\417\ Allison provided comment on 
CARB's recommendations, noting that it is not possible to draw 
conclusions about hybrid vehicles compared with conventional vehicles 
using the method recommended by CARB. Allison suggests that EPA gather 
additional data and conduct a future analysis based on data from both 
low-kinetic intensity and high kinetic intensity vehicles. In the final 
Phase 2 program, NOX emissions will be measured and reported 
as a part of powertrain testing. This will allow EPA to monitor 
NOX performance and identify potential problems long before 
sales increase to a point at which significant in-use impacts could 
occur. The information collected will also be used to inform EPA as to 
the merits of future rulemaking. However, EPA believes that finalizing 
the approach recommended at this time could represent an undue burden 
for this emerging technology.
---------------------------------------------------------------------------

    \417\ California Air Resources Board. Letter from Michael Carter 
to Matthew Spears dated December 29, 2014. CARB Request for 
Supplemental NOX Emission Check for Hybrid Vehicles. 
Docket EPA-HA-OAR-2014-0827.
---------------------------------------------------------------------------

    Based on comments received and stakeholder outreach, we have reason 
to believe that some custom chassis manufacturers are better positioned 
than others to adopt transmission technology to improve fuel 
efficiency. Most have little or no in-house research capacity, and 
purchase off-the-shelf transmissions. Some, such as Gillig and Autocar, 
have partnered with suppliers to successfully implement hybrids on 
their vehicles. Some bus chassis manufacturers are exploring the 
benefits of applying transmissions with additional gears. In real world 
driving, vehicles with a lot of transient operation, including custom 
chassis, can see real fuel savings from adoption of improved 
transmissions, including those with more efficient gears and advanced 
shift strategies. We expect that suppliers will continue to develop 
improved transmissions for vocational vehicles including some custom 
chassis, and that manufacturers will continue to select transmissions 
that deliver reliable products to fuel-conscious customers. 
Specifically, we believe that bus manufacturers will continue to have 
choices of competing products that offer performance characteristics 
that improve over time. Below in V.C.(2)(b) we discuss the reasons why 
we believe that a final Phase 2 program that is largely blind to these 
transmission-based improvements for custom chassis will avoid adverse 
unintended consequences.
(ii) Axles
    The agencies are predicating part of the stringency of the final 
vocational vehicle standards on performance of two types of axle 
technologies. The first is advanced low friction axle lubricants and 
efficiency as demonstrated using the separate axle test procedure 
described in the RIA Chapter 3.8 and 40 CFR 1037.560. The agencies 
received adverse comment on the proposal to assign a fixed 0.5 percent 
improvement for this technology. In consideration of comments, the 
agencies are instead assigning default axle efficiencies to all 
vocational vehicles. Manufacturers may submit test data to over-ride 
axle efficiency values in GEM. Our cost analysis for the final 
rulemaking includes maintenance costs of replacing axle lubricants on a 
periodic basis. See the RIA Chapter 7.1.3. Based on supplier 
information, some advanced lubricants have a longer drain interval than 
traditional lubricants. We are estimating the axle lubricating costs 
for HHD to be the same as for tractors since those vehicles likewise 
typically have three axles. However, for LHD and MHD vocational 
vehicles, we scaled down the cost of this technology to reflect the 
presence of a single rear axle. We expect that improved axle efficiency 
is technically feasible on all vocational vehicles including custom 
chassis. However, it's likely that axle suppliers may be more likely to 
invest in design and lubrication improvements for high sales volume 
products, such as axles that can serve both tractor and vocational 
markets. Further, to the extent that extreme duty cycles require 
lubricants with special performance features, it's likely that the most 
advanced low-friction lubricants may not be feasible for some custom 
chassis such as refuse trucks.
    The second axle technology applies only for HHD vocational 
vehicles, which typically are built with two rear axles. Part time 6x2 
configuration or axle disconnect is a design that enables one of the 
rear axles to temporarily disconnect or otherwise behave as if it's a 
non-driven axle. The agencies proposed to base the HHD vocational 
vehicle standard on some use of both part time and full time 6x2 axles. 
The agencies received adverse comment on the application of the 
permanent 6x2 configuration for vocational vehicles. The disconnect 
configuration is one that keeps both drive axles engaged only during 
some types of vehicle operation, such as when operating at construction 
sites or in transient driving where traction especially for 
acceleration is vital. Instead of calculating a fixed improvement as at 
proposal, the agencies have refined GEM to recognize this configuration 
as an input, and the benefit will be actively simulated over the 
applicable drive cycle. Effectiveness based on simulations with EPA 
axle files is projected to be as much as one percent for HHD Regional 
vehicles. Further information about this technology is provided in RIA 
Chapter 2.4.5. The feasibility of this technology depends on whether 
the baseline axle configuration is a 6x4 and whether the vehicle is 
likely to spend significant amounts of time on the highway. For 
vocational vehicles, this is largely limited to Regional and 
Multipurpose HHD vehicles. To the extent that any motor homes and coach 
buses with GVWR over 33,000 lbs are built with two rear axles, this 
technology could be technically feasible. However, because these 
vehicles generally operate on paved roads and may not need the traction 
of a 6x4, a popular axle configuration for these vehicles is a 
permanent 6x2.
(iii) Lower Rolling Resistance Tires
    Tires are the second largest contributor to energy losses of 
vocational vehicles, as found in the energy audit conducted by Argonne 
National Lab.\418\ The two most helpful sources of data in establishing 
the projected vocational vehicle tire rolling resistance levels for the 
final Phase 2 standards are the comments from RMA and actual 
certification data for model

[[Page 73697]]

year 2014. At proposal, we projected that all vocational vehicle 
subcategories could achieve average steer tire coefficient of rolling 
resistance (CRR) of 6.4 kg/ton and drive tire CRR of 7.0 kg/ton by MY 
2027. These new data have informed our analysis to enable us to 
differentiate the technology projections by subcategory. The RMA 
comments included CRR values for a wide range of vocational vehicle 
tires, for rim sizes from 17.5 inches to 24.5 inches, for steer/all 
position tires as well as drive tires. The RMA data, while illustrating 
a range of available tires, are not sales weighted. The 2014 
certification data include actual production volumes for each vehicle 
type, thus both steer and drive tire population-weighted data are 
available for emergency vehicles, cement mixers, school buses, motor 
homes, coach buses, transit buses, and other chassis cabs. The 
certification data are consistent with the RMA assessment of the range 
of tire CRR currently available. We also agree with RMA's suggestion to 
set a future CRR level where a certain percent of current products can 
meet future GEM targets. We disagree with RMA that the MY 2027 target 
should be a level that 50 percent of today's product can meet. With 
programmatic averaging, such a level would mean essentially no 
improvements overall from tire rolling resistance, because today when 
manufacturers comply on average, half their tires are above the target 
and half are below. Further, with Phase 2 GEM requiring many more 
vehicle inputs than tire CRR, manufacturers have many more degrees of 
freedom to meet the performance standard than they do in Phase 1. In 
these final rules, the agencies are generally projecting adoption of 
LRR tires in MY 2027 at levels currently met by 25 to 40 percent of 
today's vocational products, on a sales-weighted basis.\419\ We are 
differentiating the improvement level by weight class and duty cycle, 
recognizing that heavier vehicles designed for highway use can 
generally apply tires with lower rolling resistance than other vehicle 
types, and will see a greater benefit during use. None of the rolling 
resistance levels projected for adoption in MY 2027 are lower than the 
25th percentile of tire CRR on actual vocational vehicles sold in MY 
2014. Thus, we believe the improvements will be achievable without need 
to develop new tires not yet available. Further details are presented 
in the RIA Chapter 2.9.
---------------------------------------------------------------------------

    \418\ See Argonne National Laboratory 2009 report, Note 411, 
page 91.
    \419\ See memorandum dated May 2016 titled, Vocational Vehicle 
Tire Rolling Resistance Certification Data.
---------------------------------------------------------------------------

    In simulation, the benefit of LRR tires is reflected in GEM 
differently for vehicles of different weight classes and duty cycles. 
Based on simulations using the projected tire CRR, the agencies project 
fuel efficiency improvements by MY 2027 for LRR tires on Regional 
vocational vehicles between two and three percent, for Multipurpose 
vehicles between one and three percent, and for Urban vehicles up to 
one percent. This technology is also feasible on all custom chassis, 
with similarly larger improvements feasible for coach buses and motor 
homes with typically regional drive cycles, and similarly smaller 
improvements feasible for school and transit buses, refuse trucks, and 
concrete mixers with typically urban drive cycles.
    As proposed, the agencies will continue the light truck (LT) tire 
CRR adjustment factor that was adopted in Phase 1. 80 FR 40299; see 
generally 76 FR 57172-57174. In Phase 1, the agencies developed this 
adjustment factor by dividing the overall vocational test average CRR 
of 7.7 by the LT vocational average CRR of 8.9. This yielded an 
adjustment factor of 0.87. Because the MY 2014 certification data for 
LHD vocational vehicles may have included some CRR levels to which this 
adjustment factor may have already been applied, and because we did not 
receive adverse comment on our proposal to continue this, the agencies 
have concluded that we do not have a basis to discontinue allowing the 
measured CRR values for LT tires to be multiplied by a 0.87 adjustment 
factor before entering the values in the GEM for compliance.
    In Table V-15, the descriptors 1v through 5v refer to levels of 
rolling resistance that have been identified among the population of 
tires installed on vocational vehicles certified for MY 2014. Each of 
these levels is in production today and represents tires that have been 
fitted on a certified vehicle. The agencies have defined these levels 
for purposes of estimating the manufacturing costs associated with 
applying improved tire rolling resistance to vocational vehicles. These 
levels are not applicable for estimating degrees of improvement or 
costs of LRR tires on tractors, trailers, or HD pickups and vans as 
part of this rulemaking. Furthermore, these levels do not represent the 
full range of tire CRR available for vocational vehicles. There are 
both steer and drive tires on certified vocational vehicles today with 
CRR ranging from 5 kg/ton to 15 kg/ton. We expect this full range of 
tires will continue to be available in the market well into the future.

            Table V-15--Defined Levels of Vocational Tire CRR
------------------------------------------------------------------------
                                                           Range   Range
           Rolling resistance level descriptor             min.    max.
------------------------------------------------------------------------
LRR level 1v............................................     7.5     8.1
LRR level 2v............................................     7.0    7.49
LRR level 3v............................................     6.6    6.99
LRR level 4v............................................     6.3    6.59
LRR level 5v............................................     5.8    6.29
------------------------------------------------------------------------

(iv) Workday Idle Reduction
    The Phase 2 idle reduction technologies considered for vocational 
vehicles are those that reduce workday idling, unlike the overnight or 
driver rest period idling of sleeper cab tractors. Idle reduction 
technology is one type of technology that is particularly duty-cycle 
dependent. In light of new information, the agencies have learned that 
our proposal had mischaracterized the idling operation of vocational 
vehicles, significantly underestimating the extent of this mode of 
operation, and incorrectly calculating it using a drive idle cycle when 
significant idling also occurs while parked. As described above in 
Section V.B.(1), in these final rules we have revised our test cycles 
to better reflect real world idle operation, including both parked idle 
and drive idle test conditions. At proposal, we identified two types of 
idle reduction technologies to reduce workday idle emissions and fuel 
consumption for vocational vehicles: neutral idle and stop-start. After 
considering the new duty cycle information and the many comments 
received, we are basing our final vocational vehicle standards in part 
on the performance of three types of workday idle reduction 
technologies: neutral idle, stop-start, and automatic engine shutdown; 
which we believe are effective, feasible, and cost-effective, as 
discussed further in this section.
    Neutral idle is essentially a transmission technology, but it also 
requires a compatible engine calibration. Torque converter automatic 
transmissions traditionally place a load on engines when a vehicle 
applies the brake while in drive, which we call curb idle transmission 
torque (CITT). When an engine is paired with a manual or automated 
manual transmission, the CITT is naturally lower than when paired with 
an automatic, as a clutch disengagement must occur for the vehicle to 
stop without stalling the engine. We did not receive adverse comment on 
our proposal to include this technology in our standard-setting for 
vocational vehicles. The engineering

[[Page 73698]]

required to program sensors to detect the brake position and vehicle 
speed, and enable a smooth re-engagement when the brake pedal is 
released makes this a relatively low complexity technology that can be 
deployed broadly. Navistar commented that idle reduction strategies 
must have sufficient engine, aftertreatment and occupant protections in 
place such that any fuel cost savings are a net benefit for the owner/
operator without compromising safety. We agree, and for neutral idle we 
believe an example of an allowable override is if a vehicle is stopped 
on a hill. Skilled drivers operating manual transmissions can safely 
engage a forward gear from neutral when stopped on upslopes with 
minimal roll-back. With an AT, the vehicle's computer would need to 
handle such situations automatically. In addition, engagement of the 
PTO while driving will be an allowable over-ride condition. In the 
Phase 2 certification process, transmission suppliers will attest 
whether the transmission has this feature present and active, and 
certifying entities will be able to enter Yes or No as a GEM input for 
the applicable field. The effectiveness of this technology will be 
calculated using data points collected during the engine test, and the 
appropriate fueling over the drive idle cycle and the transient cycle 
will be used. Based on GEM simulations using the final vocational 
vehicle test cycles, the agencies project neutral idle to provide fuel 
efficiency improvements up to seven percent for diesel vehicles, and up 
to two percent for gasoline vehicles, depending on the regulatory 
subcategory.\420\ The lesser effectiveness for gasoline vehicles is due 
to lower curb idle transmission torque present in the baseline 
configurations for gasoline than the diesel vehicles, as documented in 
the SwRI report.\421\
---------------------------------------------------------------------------

    \420\ See spreadsheet file dated July 2016 titled, 
``FRM_Vocational-Standards_GEMpostprocess.xls''. See EPA-HQ-OAR-
2014-0827.
    \421\ See Reinhart 2015, Note 345 above.
---------------------------------------------------------------------------

    Neutral idle may be programmed on any automatic transmission, and 
can reasonably be applied for vocational vehicles where this feature 
would not frequently encounter an over-ride condition. Vehicles with 
high PTO operation can apply this technology, although they would see 
reduced effectiveness in use.
    Automatic engine shutdown (AES) is an engine technology that is 
widely available in the market today, but has seen more adoption in the 
tractor market than for vocational vehicles. Although we did not 
propose to include this technology, we received many comments 
suggesting this would be appropriate. Some commenters may have 
conflated the concept of stop-start with AES, such as a comment we 
received asking us to consider the on-board need to power accessories 
while the vehicle is in stationary mode. We believe that automatic 
engine shutdown is effective and feasible for many different types of 
vehicles, depending on how significant a portion of the work day is 
spent while parked. Most truck operators are aware of the cost of fuel 
consumed while idling, and importantly, the wear on the engine due to 
idling. Engine manufacturers caution owners to monitor the extent of 
idling that occurs for each work truck and to reduce the oil change 
interval if the idle time exceeds ten percent of the work day.\422\ 
Accordingly, many utility truck operators track their oil change 
intervals in engine hours rather than in miles.
---------------------------------------------------------------------------

    \422\ See Ford powerstroke guide at https://www.fleet.ford.com/truckbbas/non-html/DeiselTips/DLSIDLETIMESS.pdf (accessed March 
2016); see also Cummins maintenance schedule, available at http://www.cumminsbridgeway.com/pdf/parts/Recommended_Maintenance_Schedule.pdf (accessed March 2016).
---------------------------------------------------------------------------

    NTEA provided the agencies with a report with survey results on 
which work truck fleets are adopting AES with backup power, and their 
reasons for doing so.\423\ The most common reason given in the survey 
is to allow an engine to shut down and still have vehicle power 
available to run flashing safety lights. Some vocational vehicles also 
need to conduct work using a power take-off (PTO) while stationary for 
hours, such as on a boom truck. The agencies are adopting an allowable 
AES over-ride for PTO use. Technologies that can reduce fuel 
consumption during this type of high-load idle are discussed below in 
V.C.(1)(c)(iii). We are also adopting an allowable AES over-ride if the 
battery state of charge drops below a safe threshold. This would ensure 
there is sufficient power to operate any engine-off accessories up to a 
point where the battery capacity has reached a critical point. Where a 
vocational vehicle has such extensive stationary accessory demands that 
an auxiliary power source is impractical or that an over-ride condition 
would be experienced frequently, we would not consider AES to be 
feasible. In the Phase 2 certification process, engine suppliers will 
attest whether this feature is present and tamper-proof, and certifying 
entities will be able to enter Yes or No as a GEM input for the 
applicable field.\424\ As with neutral idle described above, the 
effectiveness of AES will be calculated in GEM using data obtained 
through engine testing. The appropriate data points over the parked 
idle cycle will be used for calculating the fueling. Based on GEM 
simulations using the final vocational vehicle test cycles, the 
agencies project AES to provide fuel efficiency improvements ranging 
from one to seven percent, depending on the regulatory subcategory.
---------------------------------------------------------------------------

    \423\ NTEA, 2015 Work Truck Electrification and Idle Management 
Study.
    \424\ We will consider non-tamper-proof AES as off-cycle 
technologies for a lesser credit.
---------------------------------------------------------------------------

    The agencies proposed to predicate the vocational vehicle standards 
in part on 70 percent adoption of stop-start in MY 2027. We received 
numerous comments from manufacturers and suppliers with concerns about 
all aspects of this technology, including its feasibility, its 
effectiveness, and the lead time to make it commercially available. As 
discussed above, our assessment of workday idle reduction technologies 
has been refined since proposal, and part of this refinement includes 
less reliance on adoption of stop-start than at proposal.
    Stop-start is a technology that requires an integration between 
engine and vehicle systems, and is seeing increasing acceptance in 
today's passenger vehicle market. The agencies are aware that for a 
vocational vehicle's engine to turn off during workday driving 
conditions, there must be a minimal reserve source of energy to 
maintain engine-protection and safety functions such as power steering, 
transmission pressure, engine lubrication and cooling, among others. As 
such, stop-start systems can be viewed as having a place on the low-
cost end of the hybridization continuum. Effenco commented that a 
minimum of additional hardware is required to deliver enough power to 
frequently and seamlessly restart a large engine as well as to keep 
accessories and equipment operational with the engine turned off. 
Navistar commented persuasively that coking can occur if the cooling 
and lubricating oil is removed. The agencies therefore would consider 
electrified water and oil pumps to be part of the stop-start technology 
package. However, we must be clear to distinguish this technology from 
the AES described above. Stop-start technologies will be recognized 
only over the drive idle cycle and the transient cycle in GEM, not the 
parked idle cycle (whereas AES is recognized only over the parked idle 
cycle). Accordingly, the purpose of the additional hardware is to 
protect the engine for short duration stops such as at traffic lights, 
not to power accessories while the vehicle is parked.
    Volvo commented that stop-start is not feasible for HHD engines 
(generally 11L and larger), and claims engine

[[Page 73699]]

development costs will be very high since stop-start cycling tests can 
only be accelerated by a limited amount before the failure mechanisms 
are altered. However, their objections relate more to the challenges of 
stop-start for HHD engines and do not actually show the technology to 
be infeasible. Although we disagree with Volvo that stop-start is 
infeasible for HHD engines, we understand it may require more 
development time and cost than for engines in lighter vehicles. It's 
possible that some time may be needed for development work where 
manufacturers elect to shift away from reliance on batteries for 
starting the engine and begin to rely instead on ultracapacitors, which 
do not have the same problems with cold weather operation and long term 
fatigue as do batteries.\425\ Volvo and EMA commented that main and rod 
bearings as well as other bearing surfaces would need to be 
strengthened and improvements may be needed for starters and 
lubrication systems. We agree with commenters that this type of 
development work would likely be part of bringing this technology to 
the vocational vehicle market, and thus we have included costs for 
upgrades similar to those described for all sizes of engines, not just 
those over 11L. In the event that an engine manufacturer needs to delay 
adoption of stop start to roll these changes in to a planned platform 
redesign, we believe our relatively modest adoption rate of 30 percent 
in MY 2027 will accommodate this. Descriptions of costs for stop-start 
may be found in the RIA Chapter 2.11.6.6.
---------------------------------------------------------------------------

    \425\ Maxwell Technologies, How Ultracapacitors Improve Starting 
Reliability for Truck Fleets, 2016.
---------------------------------------------------------------------------

    We are not aware of stop-start systems that are commercially 
available for conventional vocational vehicles today, but this feature 
is available as part of some current hybrid systems. We are aware of 
one supplier who is demonstrating today a capacitor-based stop-start 
system with on-board electronics sufficient to protect a HHD engine and 
even power a PTO.\426\ Furthermore, other manufacturers and suppliers 
are researching this.\427\ Therefore we are confident heavy-duty stop-
start systems for conventional vehicles will be feasible in the time 
frame of Phase 2. Where stop-start is relied upon as part of a 
certified configuration with components installed by a secondary 
manufacturer, these will be subject to specifications and installation 
instructions of the certifying manufacturer.
---------------------------------------------------------------------------

    \426\ See comment submitted by Effenco describing such a system 
designed for a refuse packer.
    \427\ See phone log for L. Steele, conversation with B. Van 
Amburg, May 2016.
---------------------------------------------------------------------------

    In response to comments, we are adopting some permissible over-ride 
conditions under which a stop-start system may either restart sooner 
than otherwise or not shut down an engine. Navistar, Waste Management 
and others commented that vehicles with a significant power take-off 
(PTO) load will not be able to accommodate start/stop technology. As 
with neutral idle, we agree that engagement of the PTO while driving 
should be an allowable over-ride condition, as there are some vehicles 
that must conduct PTO work while underway. For example, cement mixers 
must continually rotate the drum and refuse trucks routinely compact 
their load throughout their neighborhood collection activity. 
Additional over-rides are discussed in the RIA Chapter 2.9.3.4. If a 
manufacturer designs a system that does not need as many over-rides due 
to additional electrification or other on-board systems, then an 
application for off-cycle credit may be submitted, to recognize a 
greater effectiveness. The regulations at 40 CFR 1037.660 specify the 
allowable over-rides.
    The effectiveness of stop-start as recognized in GEM will be 
engine-dependent. Engines with high emissions/fuel consumption at idle 
will see greater reductions. Also, vehicles that idle frequently will 
see greater reductions. Based on GEM simulations using the final 
vocational vehicle test cycles, the agencies project stop-start to 
provide fuel efficiency improvements up to 14 percent for diesel 
vehicles, and up to 11 percent for gasoline vehicles, depending on the 
regulatory subcategory. See RIA 2.9.3.4. The data points for 
calculating the fueling over the transient and drive idle cycles are 
obtained from the engine map, and vehicle certifiers may input Yes or 
No when running GEM, to indicate whether the engine shuts off within 
five seconds of zero vehicle speed with the service brake applied. 
Allison commented that GEM should calculate fueling only for a couple 
seconds before assuming the engine shuts down in a stop-start system. 
Navistar suggested that we recognize that some fleets--e.g. heavy haul, 
refuse, mixer trucks and tow trucks--may elect to have this feature set 
as a programmable parameter to ensure maximum safety is maintained. We 
believe that five seconds is appropriate because we expect a wide 
variety of stop-start solutions to be deployed in the vocational 
vehicle market, and we anticipate modest use of over-ride conditions. 
Setting a shorter duration before shutdown could over-estimate the 
reductions achieved by this technology in use. We believe this is a 
fair way to represent that the system may not have the designed 
effectiveness under all conditions.
    As with the other idle reduction technologies described above, 
stop-start can reasonably be applied for vocational vehicles where this 
feature would not frequently encounter an over-ride condition. Vehicles 
with very little driving in transient conditions or with high PTO 
operation can apply this technology, although they would see reduced 
effectiveness in use. Chassis manufacturers certifying refuse trucks to 
the optional custom chassis standards may enter Yes in the input field 
in GEM for stop-start and the effectiveness will be computed based on 
the default 350 hp engine with 5-speed HHD automatic transmission.. 
Manufacturers opting to certify refuse trucks to the primary standards 
will have an option to be recognized for enhanced stop-start systems 
through the powertrain test See RIA 2.9.3.4 and 2.9.5.1.4.
    The agencies received comments from Allison Transmission where they 
observed a seven percent NOX co-benefit of stop-start idle 
reduction technology on transit buses. Daimler also commented that it 
is investigating the potential for improving heat retention in the SCR 
system via stop-start, but because of early stages of development it 
cannot verify or quantify actual benefits. The agencies also conducted 
independent NOX testing of engines at idle; however, the 
data are not conclusive enough for the agencies to quantify the 
NOX co-benefits of vocational workday idle reduction as part 
of this rulemaking.
(v) Weight Reduction
    The agencies are predicating the final vocational vehicle standards 
in part on use of material substitution for weight reduction. The 
method of recognizing this technology is similar to the method used for 
tractors. The agencies have created a menu of vocational chassis 
components with fixed reductions in pounds that may be entered in GEM 
when substituting a component made of a more lightweight material than 
the base component made of mild steel. According to the 2009 TIAX 
report, there are freight-efficiency benefits to reducing weight on 
vocational vehicles that carry heavy cargo, and tax savings potentially 
available to vocational vehicles that remain below excise tax weight 
thresholds. This report also estimates that the cost effectiveness of 
weight reduction over urban drive cycles is potentially greater than 
the cost effectiveness of weight reduction

[[Page 73700]]

for long haul tractors and trailers. We are adopting as proposed a GEM 
allocation of half the weight reduction to payload and half to reduced 
chassis weight. We did not receive comment suggesting a different 
weight allocation. The menu of components available for a vocational 
vehicle weight reduction in GEM is presented in Section V.D.1 and in 
the RIA Chapter 2.9, and is in the regulations at 40 CFR 1037.520. It 
includes fewer options than proposed, due to persuasive comments from 
Allison that aluminum transmission cases and clutch housings are 
standard for automatic transmissions. The American Iron and Steel 
Institute (AISI) commented that light weight values for high strength 
steel should be adjusted upward, citing light-duty vehicle weight 
reduction approaches using high strength steel and saying these 
improvements should apply to the heavy-duty sector as well. AISI also 
commented against the inclusion of any light-weight components as a 
compliance mechanism for vocational vehicles without technical data to 
support the weight saving values. At proposal, we based our weight 
reduction values for class 8 vocational vehicles on the values adopted 
for use in certifying tractors in Phase 1. We proposed to scale these 
values down for lighter weight vehicles based either on number of axles 
or other attributes based on engineering judgment. We also considered 
information supplied by expert members of the Aluminum Transportation 
Group.\428\ The final rules reflect revised weight reduction values in 
response to the comments from AISI, and in further consideration of 
information provided by the Aluminum Transportation Group. We were 
unable to make use of the additional references submitted by AISI as 
part of this standard-setting process, either because the technology 
requires redesign rather than material substitution, or because we did 
not see a way to apply the light-duty information to heavy-duty 
vehicles. For setting stringency, however, we do not rely on any values 
in the lookup table except those for aluminum wheels (although these 
performance-based standards may be achieved in the manner deemed most 
cost-effective by manufacturers). The stringency of the final 
vocational vehicle standards for custom chassis transit buses and 
vehicles in the primary program is based in part on use of aluminum 
wheels in 10 positions on 3-axle vocational vehicles (250 lbs) and in 6 
wheel positions on 2-axle vocational vehicles (150 lbs). Based on the 
TIAX report and experience with the tractor program, the agencies are 
confident that manufacturers who choose to incorporate weight reduction 
on vocational vehicles will have a number of feasible material 
substitution choices at the chassis level, which could add up to weight 
savings of hundreds of pounds. The agencies do not have information 
about any subset of vocational vehicles that would be unable to adopt 
aluminum wheels, thus our projected adoption rates are much higher than 
at proposal. Our projected adoption rate is revised upward based on the 
determination that the technology package is smaller (fewer pounds 
removed than at proposal) and that aluminum wheels are widely available 
and feasible. We have learned through stakeholder outreach that weight-
sensitive applications such as ready-mix concrete and refuse have 
already extensively applied weight reduction technologies, for freight 
efficiency reasons.\429\ Therefore the agencies have not predicated the 
standards for these custom chassis on further weight reduction.
---------------------------------------------------------------------------

    \428\ See email to L. Steele from D. Richman dated March 19, 
2015 with attachments.
    \429\ See phone log for L. Steele, conversation with Terex (Aug 
2015) and meeting with Autocar (April 2016).
---------------------------------------------------------------------------

    Based on the default payloads in GEM, and depending on the 
vocational vehicle subcategory, the agencies estimate a reduction of 
250 lbs would offer a fuel efficiency improvement of up to one percent 
for HHD vehicles, and a reduction of 150 pounds would offer a fuel 
efficiency improvement up to 0.8 percent for MHD vehicles, and up to 
1.5 percent for LHD vehicles. See RIA 2.9.3.5.
    The agencies received comment that the HD Phase 2 program should 
recognize the enhanced benefit of weight reduction of rotating 
components, but the agencies lack sufficient data to incorporate the 
necessary programming in GEM to enable this feature. Manufacturers 
wishing to obtain credit for lightweight components beyond those on the 
menu in the regulations or for use of lightweighting technologies that 
are more effective than we have projected, may apply for off-cycle 
credits.
(vi) Electrified Accessories
    Although we did not propose to allow pre-defined credit for 
electrified accessories as was proposed for tractors, we received 
comment requesting that this be allowed for vocational vehicles. As 
discussed above, the agencies are projecting that some electrified 
accessories will be necessary as part of the development of stop-start 
idle reduction systems for vocational vehicles. The technology package 
for vocational stop-start includes costs for high-efficiency 
alternator, electric water pump, electric cooling fan, and electric oil 
pump. However, because the GEM algorithm for determining the fuel 
benefit of stop-start does not account for any e-accessories, vehicles 
certified with stop-start are also eligible to be certified using an 
improvement value in the e-accessories column.
    Daimler, ICCT, Bendix, Gentherm, Navistar, Odyne, and CARB asked 
the agencies to consider electric cooling fans, variable speed water 
pumps, clutched air compressors, electric air compressors, electric 
power steering, electric alternators, and electric A/C compressors. 
ICCT cautioned that certain accessories would be recognized over an 
engine test and credit should not be duplicated at the vehicle level. 
Bosch suggested that high-efficiency alternators be considered, and 
suggested use of a standard component-level test for alternators to 
determine their efficiency, and establishment of a minimum efficiency 
level that must be attained. Although there are industry-accepted test 
procedures for measuring the performance of alternators, we do not have 
sufficient information about the baseline level performance of 
alternators to define an improved level that would qualify for a 
benefit at certification. We are not able to set a fixed improvement 
for electric cooling fans or clutched accessories due to similar 
challenges related to baselines and defining the qualifying technology. 
In consideration of ICCT's comment, we are not including water pumps 
and oil pumps among the components eligible for a fixed improvement 
because we believe that our engine test procedure will recognize 
improvements that would be seen in the real world from electrifying 
these. Thus, we believe it is appropriate to offer a fixed technology 
improvement for use of electric power steering and an electric A/C 
compressor as an input to GEM.
    The agencies have conducted modeling in GEM to compare 
configurations with different default accessory loads, and have 
demonstrated there is a measurable effect of reducing 1 kW of accessory 
load for each vocational subcategory (see RIA 2.9.3.6). The agencies 
have incorporated information from this GEM modeling with information 
from comments provided by ICCT, the TIAX 2009 technology report, CARB's 
Driveline Optimization report, and the 2010 NAS report to assign fixed 
improvement values for the defined technologies as

[[Page 73701]]

shown in Table V-16. These values are consistent with the TIAX study 
that used 2 to 4 percent fuel consumption improvement for accessory 
electrification, with the understanding that electrification of 
accessories will have more effect in short haul/urban applications and 
less benefit in line-haul applications.\430\ The RIA Chapter 2.9 
explains how these effectiveness values were obtained.
---------------------------------------------------------------------------

    \430\ TIAX 2009, pp. 3-5.

          Table V-16--Effectiveness of Vocational E-Accessories
------------------------------------------------------------------------
                                  Effectiveness
           Technology                   %             Subcategories
------------------------------------------------------------------------
Electric A/C Compressor........             0.5  HHD.
                                            1.0  MHD & LHD.
Electric Power Steering........             0.5  Regional.
                                            1.0  Multipurpose & Urban.
------------------------------------------------------------------------

    Optimization and improved pressure regulation may significantly 
reduce the parasitic load of the water, air and fuel pumps. 
Electrification may result in a reduction in power demand, because 
electrically-powered accessories (such as the air compressor or power 
steering) operate only when needed if they are electrically powered, 
but they impose a parasitic demand all the time if they are engine-
driven. In other cases, such as cooling fans or an engine's water pump, 
electric power allows the accessory to run at speeds independent of 
engine speed, which can reduce power consumption. Electrification of 
accessories can individually improve fuel consumption, regardless of 
whether the drivetrain is a strong hybrid. Some vocational vehicle 
applications have much higher accessory loads than is assumed in the 
default GEM configurations. In the real world, there may be some 
vehicles for which there is a much larger potential improvement 
available than those listed above, as well as some for which 
electrification is not cost-effective. To date, accessory 
electrification has been associated only with hybrids, although 
CalStart commented they are optimistic that accessory electrification 
will become more widespread among conventional vehicles in the time 
frame of Phase 2.
    Electric power steering (EPS) or Electrohydraulic power steering 
(EHPS) provides a potential reduction in CO2 emissions and fuel 
consumption over hydraulic power steering because of reduced overall 
accessory loads. This eliminates the parasitic losses associated with 
belt-driven power steering pumps which consistently draw load from the 
engine to pump hydraulic fluid through the steering actuation systems 
even when the wheels are not being turned. EPS is an enabler for all 
vehicle hybridization technologies since it provides power steering 
when the engine is off. EPS is feasible for most vehicles with a 
standard 12V system. Some heavier vehicles may require a higher voltage 
system which may add cost and complexity.
    Manufacturers wishing to obtain credit for technologies that are 
more effective than we have projected, or technologies beyond the scope 
of this defined technology improvement, may apply for off-cycle 
credits.
(vii) Tire Pressure Systems
TPMS
    The agencies did not propose to base the vocational vehicle 
standards on the performance of tire pressure monitoring systems 
(TPMS). However, we received comment that we should consider this 
technology. See discussion in Section III.D.1.b. In addition to 
comments related to tractors and trailers, RMA commented that TPMS can 
also apply to the class 2b-6 vehicles, and if the agencies add TPMS to 
the list of recognized technologies, that this choice should also be 
made available to class 2b-6 vehicles. Bendix commented that TPMS is a 
proven product, readily available from a number of truck, bus, and 
motor coach OEMs. Autocar commented that TPMS is useful for refuse 
truck applications. Tirestamp said that TPMS is ideal for trucks and 
buses that are unable to apply ATIS due to difficulties plumbing air 
lines externally of the axles. The agencies find these comments to be 
persuasive. As a result, we are finalizing vocational vehicle standards 
that are predicated on the performance of TPMS in all subcategories, 
including all custom chassis except emergency vehicles and concrete 
mixers. Available information indicates that it is feasible to utilize 
TPMS on all vocational vehicles, though systems for heavy vehicles in 
duty cycles where the air in the tires becomes very hot must be 
ruggedized so that the sensors are protected from this heat. Such 
devices are commercially available, though they cost more. To account 
for this in our analysis, we have projected a lower adoption rate for 
TPMS in Urban vehicles than for Regional or Multipurpose vehicles, 
rather than by increasing the cost and applying an equal adoption rate. 
We are assigning a fixed improvement in GEM for use of this technology 
in vocational vehicles of one percent for Regional vehicles including 
motor coaches and RV's (the same as for tractors and trailers) and 0.9 
percent for Multipurpose, Urban, and other custom chassis vocational 
vehicles, recognizing that the higher amount of idle is likely to 
reduce the effectiveness for these vehicles. These values will be 
specified as GEM inputs in the column designated for tire pressure 
systems.
ATIS
    The agencies did not propose to base the vocational vehicle 
standards on the performance of automatic tire inflation systems 
(ATIS), otherwise known as central tire inflation (CTI). However, we 
did receive comment indicating that it is feasible on some vocational 
vehicles. Air CTI commented that central tire inflation is not only 
feasible but enhances safety on vehicles such as dump trucks and heavy 
haul vehicles that need higher tire pressures under certain driving 
conditions, such as when loaded, but need lower tire pressures when 
running empty or operating off-road. Tirestamp commented that ATIS can 
be plumbed externally for trucks and buses, but such systems have a 
propensity for damage and Autocar has provided information about how 
much extra weight this plumbing adds to the chassis. ATA commented that 
some onboard air pressure systems may not be able to pressurize tires 
sufficiently for very heavy vehicles. The primary vocational vehicle 
standards are not predicated on any adoption of this because the 
agencies do not have sufficient information about which chassis will 
have an onboard air supply for purposes

[[Page 73702]]

of an air suspension or air brakes. ATIS would logically only be 
adopted for vehicles that already need an onboard air supply for other 
reasons. Comments received for custom chassis were supportive of 
standards predicated on ATIS for buses with air suspensions. These 
comments are again persuasive. As a result, we are basing the optional 
standards for refuse trucks, school buses, coach buses, and transit 
buses in part on the adoption of ATIS. Although many motor homes have 
onboard air supply for other reasons making ATIS technically feasible, 
it is sufficiently costly that it is not practically feasible. 
Furthermore, for the same reasons stated above about the disadvantages 
of installing external plumbing for ATIS on some trucks and buses, we 
have determined it is not feasible for emergency vehicles or concrete 
mixers. Nonetheless, we are allowing vocational vehicles including all 
custom chassis to obtain credit for the performance of ATIS through a 
GEM input with a fixed improvement of 1.2 percent for Regional vehicles 
including motor coaches and RV's (the same as for tractors and 
trailers) and 1.1 percent for Multipurpose, Urban, and other custom 
chassis vocational vehicles, recognizing that the higher amount of idle 
is likely to reduce the effectiveness for these vehicles. These values 
will be specified as GEM inputs in the column designated for tire 
pressure systems. See discussion in Section III.D.1.b for our reasoning 
behind this effectiveness value.
(viii) HFC Refrigerant From Cabin Air Conditioning (A/C) Systems
    Manufacturers can reduce direct A/C leakage emissions by utilizing 
leak-tight components. EPA's HFC direct emission leakage standard is 
independent of the CO2 vehicle standard. Manufacturers may 
choose components from a menu of leak-reducing technologies sufficient 
to comply with the standard, as opposed to using a test to measure 
performance. See 76 FR 57194. A discussion of comments regarding use of 
low global warming potential refrigerants and EPA's responses to those 
comments can be found in Section I.F of this Preamble.
    In Phase 1, EPA adopted a HFC leakage standard to assure that high-
quality, low-leakage components are used in each air conditioning 
system installed in HD pickup trucks, vans, and combination tractors 
(see 40 CFR 1037.115). We did not adopt a HFC leakage standard in Phase 
1 for systems installed in vocational vehicles. In the final Phase 2 
program, as proposed, EPA is extending the HFC leakage standard to all 
vocational vehicles. Beginning in the 2021 model year, vocational 
vehicle air conditioning systems with a refrigerant capacity of greater 
than 733 grams must meet a leakage rate of 1.50 percent leakage per 
year and systems with a refrigerant capacity of 733 grams or lower meet 
a leakage standard of 11.0 grams per year. EPA has determined that an 
approach of having a leak rate standard for lower capacity systems and 
a percent leakage per year standard for higher capacity systems will 
result in reduced refrigerant emissions from all air conditioning 
systems, while still allowing manufacturers the ability to produce low-
leak, lower capacity systems in vehicles which require them.
    Research has demonstrated that reducing A/C system leakage is both 
highly cost-effective and technologically feasible. The availability of 
low leakage components is being driven by the air conditioning program 
in the light-duty GHG rule which began in the 2012 model year and the 
HD Phase 1 rule that began in the 2014 model year. The cooperative 
industry and government Improved Mobile Air Conditioning program has 
demonstrated that new-vehicle leakage emissions can be reduced by 50 
percent by reducing the number and improving the quality of the 
components, fittings, seals, and hoses of the A/C system.\431\ All of 
these technologies are already in commercial use and exist on some of 
today's systems, and EPA does not anticipate any significant 
improvements in sealing technologies for model years beyond 2021. 
However, EPA has recognized some manufacturers utilize an improved 
manufacturing process for air conditioning systems, where a helium leak 
test is performed on 100 percent of all o-ring fittings and connections 
after final assembly. By leak testing each fitting, the manufacturer or 
supplier is verifying the o-ring is not damaged during assembly (which 
is the primary source of leakage from o-ring fittings), and when 
calculating the yearly leak rate for a system, EPA will allow a 
relative emission value equivalent to a `seal washer' to be used in 
place of the value normally used for an o-ring fitting, when 100 
percent helium leak testing is performed on those fittings.
---------------------------------------------------------------------------

    \431\ Team 1-Refrigerant Leakage Reduction: Final Report to 
Sponsors, SAE, 2007.
---------------------------------------------------------------------------

    We received comments from CARB and Daimler in support of applying 
these leakage standards to vocational vehicles. Daimler specifically 
expressed support for excluding A/C systems used to cool the cargo area 
of trucks, as well as for allowing helium testing as a compliance 
option. Thus, we are adopting these provisions as proposed. EMA 
commented with concerns about the burden of certifying A/C systems that 
are installed by secondary manufacturers. Section V.D.2 discusses how 
we have addressed the concerns related to secondary manufacturers. We 
also received comments from RVIA asking for clarification whether the 
cargo area exclusion also applied to A/C units that cool the living 
space of recreational vehicles. In response, we are adding clarifying 
language to the regulations at 40 CFR 1037.115 excluding A/C systems 
that are not powered by the vehicle's propulsion engine.
    The A/C system leakage control costs presented in the RIA Chapter 
2.9 and 2.11 are applied to all heavy-duty vocational vehicles. EPA 
views these costs as minimal and the reductions of potent GHGs to be 
easily feasible and reasonable in the lead times provided by the final 
rules.
(b) Engine Technologies Considered in Vehicle Standard-Setting
    Section II explains the technical basis for the agencies' proposed 
separate engine standards. The agencies are not predicating the 
vocational vehicle standards on different diesel engine technology 
packages than those presumed for compliance with the separate diesel 
engine standards. However, for each model year of the Phase 2 
standards, the agencies are predicating the SI-powered vocational 
vehicle standards on a gasoline engine technology package that includes 
additional technologies beyond those presumed for compliance with the 
MY 2016 gasoline engine standard. Put another way, the stringency of 
certain of the vocational vehicle standards, and those for vehicles 
using SI engines in particular, reflect in part improvements in engine 
efficiency which are not measured in the engine standard or in engine 
certification.
    The primary vocational vehicle standards vary depending on whether 
the engines powering those vehicles are compression-ignition or spark-
ignition.\432\ As in Phase 1, this is not the case for the custom 
chassis standards, because GEM uses a default engine that is the same 
for every regulated custom chassis type, regardless of the actual 
engine being installed. As described above in Section II, the Phase 2 
vehicle certification tool, GEM, requires manufacturers certifying to 
the primary standards to enter specific engine performance data, where 
emissions and

[[Page 73703]]

fuel consumption profiles will differ significantly depending on the 
engine's architecture.\433\
---------------------------------------------------------------------------

    \432\ Specifically, EPA is adopting CO2, 
N2O, and CH4 emission standards for new heavy-
duty engines over an EPA specified useful life period (See Section 
II).
    \433\ See Section II.D.5 for an explanation of which engine 
architecture will need to meet which standard.
---------------------------------------------------------------------------

    As explained in Section II.A.2, engines will continue to be 
certified over the FTP test cycle via direct testing, not GEM 
simulation. The FTP test cycle that is applicable for bare vocational 
engines is very different than the test cycles for vocational vehicles 
in GEM. The FTP is a very demanding transient cycle that exercises the 
engine over its full range of capabilities. In contrast, the cycles 
evaluated by GEM measure emissions over more frequently used engine 
operating ranges. The ARB Transient vehicle cycle represents city 
driving, and the highway cruise cycles measure engine operation that is 
closer to steady state. Each of these cycles is described in the RIA 
Chapter 3.4.2. A consequence of recognizing engine performance at the 
vehicle level is that further engine improvements (i.e. improvements 
measureable by duty cycles that more precisely represent driving 
patterns for specific subcategories of vocational vehicles) can be 
evaluated as components of a technical basis for a vocational vehicle 
standard.\434\ For this reason, the agencies considered whether any 
different engine technologies should be included in the feasibility 
analysis for the vehicle standards (and potentially, in the standard 
stringency).
---------------------------------------------------------------------------

    \434\ As noted in Section II.B.2 above, manufacturers also have 
greater flexibility to meet a vehicle standard if engine 
improvements can be evaluated as part of compliance testing.
---------------------------------------------------------------------------

    We did not propose to predicate any diesel vocational vehicle 
standard on additional engine technology, including engine waste heat 
recovery (WHR). We do not believe this technology would show 
significant benefit in vocational vehicle applications due to their 
driving cycles, which have fewer highway miles than tractors. Thus, the 
final vocational vehicle standards assume that diesel engines perform 
at the level of the certified engine configuration.
    The agencies received extensive comment on our assessment of SI 
engine technologies, and how these could be included in the vocational 
vehicle technology packages. We predicated the proposed MY 2027 SI-
powered vocational vehicle standards on additional friction reduction, 
for a 0.6 percent fuel efficiency improvement. UCS, EDF, NRDC, and ICCT 
ask the agencies to rely on the 2015 SwRI study suggesting 8 percent 
improvement is possible. UCS highlights packages #16 and #22 of the 
SwRI report for the agencies' further consideration. These packages 
were assembled by SwRI to simulate the combined performance of engine 
technologies over some well-known vehicle drive cycles. Because none of 
the technical data referenced by these commenters provides information 
on how these technologies perform over the HD gasoline engine FTP test 
procedure, the agencies are considering these to be comments on the 
GEM-based vocational vehicle standards, not comments on the separate 
FTP-based SI engine standard. Please see Section II.D.2(b) of this 
Preamble for the agencies' response to comments on the stringency of 
the separate SI engine standard.
    SwRI package #16 applies variable valve actuation and exhaust gas 
recirculation to a 3.5 liter V6 engine. SwRI package #22 applies 
stoichiometric direct gas injection, exhaust gas recirculation, dual 
cam phasers, and advanced friction reduction to a 6.2 liter V8 engine. 
All of the SwRI packages compare the future vehicle performance to a 
pre-Phase 1 baseline, thus counting all the improvements already 
presumed in the MY 2016 engine standard, so the delta between what the 
commenter seeks and what the agencies proposed is considerably less 
than initially appears (and than the commenter appeared to believe). 
The agencies' default SI engine map for setting the SI-powered 
vocational vehicle standards is a MY 2016 6.8 liter V8 engine. The RIA 
Chapter 2.9.1 presents the EPA default map that meets the MY 2016 
engine standard. We are adhering to the proposed approach of 
recognizing SI engine improvements only in the vocational vehicle 
standard. In response to comments, the agencies are adopting final 
vehicle-level standards for SI-powered vocational vehicles that are 
predicated in part on adoption of cylinder deactivation in addition to 
the advanced friction reduction reflected in the proposal, both of 
which have incremental costs beyond those needed to meet the separate 
FTP-based engine standard, and both of which will be recognized over 
the GEM vehicle cycles. Indeed, cylinder deactivation would not be 
expected to be recognized at all over the engine FTP cycle (another 
reason the improvement is reflected in the final vehicle standard). As 
proposed, the effectiveness and adoption rate of Level 2 engine 
friction reduction yields a fuel efficiency improvement of 0.6 percent. 
By adding 30 percent adoption of cylinder deactivation with a vehicle-
cycle average effectiveness of 1 percent, and accounting for a dis-
synergy factor of 0.9, this yields an overall package effectiveness of 
0.8 percent. Upon consideration of comments and the data in the SwRI 
reports, we are not including EGR as a technology for stringency 
purposes. EGR is potentially feasible, is not already presumed to be 
adopted in the 2016 engine standard, and may possibly be recognized 
over the GEM vehicle cycles to some extent. However, we did not have 
sufficient data to confidently project an effectiveness or adoption 
rate for this technology on vocational SI engines. Further, the Phase 2 
HD pickup truck and van standards are not predicated on any adoption of 
EGR technologies for SI vehicles. The RIA Chapter 2.9.1 describes how 
each of the SI engine technologies are expected to perform over the GEM 
vehicle cycles, as well as the method for projecting that the fuel 
efficiency improvement will be 0.8 percent compared to the baseline SI 
vehicle performance.
    With respect to standards for engines used in custom chassis, we 
understand that engines designed for heavy-duty emergency vehicles are 
generally higher-emitting than other engines. However, because we are 
maintaining a separate engine standard and regulatory flexibility such 
as ABT, fire apparatus manufacturers will be able to obtain engines 
that, on average, meet the Phase 2 engine standards. The agencies 
further recognize that the engine map inputs to GEM in the primary 
program could pose a difficulty for emergency vehicle manufacturers. If 
we required engine-specific inputs then these manufacturers will have 
to apply extra vehicle technologies to compensate for the necessary but 
higher-emitting engine. The agencies are therefore not recognizing 
vehicle-specific engine performance as part of the vehicle standard for 
emergency vehicles (although the standards for emergency vehicles and 
custom chassis do presume use of a certified Phase 2 engine). 
Manufacturers of these vehicles must install an engine that is 
certified to the applicable separate Phase 2 engine standard. However, 
under the custom chassis program emergency vehicle manufacturers need 
not follow the otherwise applicable Phase 2 approach of entering an 
engine map in GEM. Instead, use of a custom chassis subcategory 
identifier will instruct GEM to simulate the vehicle using an EPA 
default engine.

[[Page 73704]]

(c) Technologies the Agencies Assessed But Did Not Use In Standard-
Setting
(i) Aerodynamics
    The agencies did not propose to include aerodynamic improvements as 
a basis for the Phase 2 vocational vehicle standards. However, we did 
request comment on an option to allow credits for use of aerodynamic 
devices such as fairings on a very limited basis. We received public 
comments from AAPC in support of offering this as an optional credit, 
with a suggestion to allow this option for a wide range of vehicle 
sizes, and suggesting that the grams per ton-mile benefit could be 
scaled down for larger vehicles. CARB commented in support of a Phase 2 
program that would include use of aerodynamic improvements as a basis 
for the stringency, suggesting that a large fraction of the vocational 
vehicle fleet could see real world benefits from use of aerodynamic 
devices. Because we do not have sufficient fleet information to 
establish a projected application rate for this technology, we are not 
basing any of the final standards for vocational vehicles on use of 
aerodynamic improvements. See 80 FR 40303. In consideration of 
comments, however, we are adopting provisions for vocational vehicles 
to optionally receive an improved GEM result by certifying use of a 
pre-approved aerodynamic device, and are expanding eligibility criteria 
from the relatively narrow criteria proposed.
    Based on testing supported by CARB, the agencies have developed a 
list of specific aerodynamic devices with pre-defined improvement 
values (in delta CDA units), as well as criteria regarding 
which vehicles are eligible to earn credit in this manner. See Chapter 
2.9.4.1 of the RIA. In response to comments, we are allowing a wide 
range of vehicles to be eligible to use this option. Regional 
vocational vehicles in any weight class may use this option, subject to 
restrictions on the size of the chassis (see 40 CFR 1037.520). The 
degree of change in CDA for each pre-approved device has 
been set at conservative values due to the small number of 
configurations tested and the uncertainty inherent in those results. 
Manufacturers wishing to receive credit for other aerodynamic 
technologies or on other vehicle configurations may seek credit using 
the test procedures described in 40 CFR 1037.527. Manufacturers using 
this credit provision may enter the pre-defined delta CDA as 
an input to GEM, and the simulation will determine the effectiveness 
over the duty cycle. Using this approach, we do not need to set a 
scaled benefit for different sizes of vehicles. When the vehicle weight 
class and duty cycle is specified, a default chassis mass and payload 
are simulated in GEM. When the pre-defined delta CDA is 
entered, the simulation returns a resulting improved performance with 
respect to the specified chassis configuration. GEM will logically 
return a smaller improvement for heavier vehicles.
    The final Regional composite duty cycle in GEM for vocational 
vehicles has a weighted average speed of 38 mph, increased from the 
average speed at proposal due to a heftier 56 percent composite 
weighting of the 65 mph drive cycle. The agencies have learned from the 
NREL duty cycle analysis that vocational vehicles with operational 
behavior of a regional nature accumulate more miles at highway speeds 
than previously assumed.
    Using GEM simulation results, the agencies estimate the fuel 
efficiency benefit of improving the CDA of a Class 6 box 
truck by 11 percent (0.6 m\2\ delta CDA off of a default of 
5.4 m\2\) at approximately five percent over the Regional composite 
test cycle. This same delta CDA simulated in GEM on a class 
8 Regional vocational vehicle results in an overall improvement of less 
than four percent because the default CDA in GEM for class 8 
vocational vehicles is 6.86 m\2\ so the change in CDA is 
only nine percent. Although in actual operation the added weight of 
aerodynamic fairings may reduce the operational benefits of these 
technologies when driving at low speeds, the agencies are not applying 
any weight penalty as part of the certification process for vocational 
aerodynamic devices.
    As described in the NPRM, we are requiring chassis manufacturers 
employing this option to provide assurances to the agencies that these 
devices will be installed as part of the certified configuration, even 
if the installation is completed by another entity. We received many 
comments on the requirements for secondary manufacturers as they apply 
for vocational aerodynamics as well as other technologies that may be 
specified by a chassis manufacturer but installed later. See Section 
I.F.2 and Section V.D.2 for further discussion of delegated assembly 
issues.
(ii) Full Electric Trucks
    Given the high up-front costs and the developing nature of this 
technology, the agencies do not project fully electric vocational 
vehicles to be widely commercially available in the time frame of the 
final rules. For this reason, the agencies have not based the Phase 2 
standards on adoption of full-electric vocational vehicles. We received 
many comments on electric trucks and buses. Specifically, EEI provided 
information on the total cost of ownership for electric trucks, and 
some applications may see attractive long term cost scenarios for 
electric trucks or buses, when considering maintenance savings. While 
we are not predicating the final vocational vehicle standards on 
adoption of full electric trucks or buses, we have reinstated an 
advanced technology credit multiplier, in response to comment. See 
Section I.C.1.(b) for a discussion of credit multipliers.
    To the extent this technology is able to be brought to market in 
the time frame of the Phase 2 program, there is currently a 
certification path for these chassis from Phase 1, as described in 
EPA's regulations at 40 CFR 1037.150 and NHTSA's regulations at 49 CFR 
535.8.
(iii) E-PTO
    Although the primary program does not simulate vocational vehicles 
over a test cycle that includes PTO operation, the agencies are 
adopting a revised hybrid-PTO test procedure. See 76 FR 57247 and 40 
CFR 1037.540. Recall that we regulate vocational vehicles at the 
incomplete stage when a chassis manufacturer may not know at the time 
of certification whether a PTO will be installed or how the vehicle 
will be used. Chassis manufacturers may rarely know whether the PTO-
enabled vehicle will use this capability to maneuver a lift gate on a 
delivery vehicle, to operate a utility boom, or merely to keep it as a 
reserve item to add value in the secondary market. For these reasons, 
it would not be fair to require every vocational vehicle to certify to 
a standard test procedure with a PTO cycle in it. Thus, we are not 
basing the final standards on use of technology that reduces emissions 
in PTO mode.
    There are products available today that can provide auxiliary 
power, usually electric, to a vehicle that needs to work in PTO mode 
for an extended time, to avoid idling the main engine. There are 
different designs of electrified PTO systems on the market today. Some 
designs have auxiliary power sources, typically batteries, with 
sufficient energy storage to power an onboard tool or device for a 
short period of time, and are intended to be recharged during the 
workday by operating the main engine, either while driving between work 
sites, or by idling the engine until a sufficient state of charge is 
reached that the engine may shut off. Other designs have

[[Page 73705]]

sufficient energy storage to power an onboard tool or device for many 
hours, and are intended to be recharged as a plug-in hybrid at a home 
garage. In cases where a manufacturer can certify that a PTO with an 
idle-reduction technology will be installed either by the chassis 
manufacturer or by a second stage manufacturer, the hybrid-PTO test 
cycle may be utilized by the certifying manufacturer to measure an 
improvement factor over the GEM duty cycle that otherwise applies to 
that vehicle. In addition, the delegated assembly provisions will apply 
(see Section V.D). See RIA Chapter 3.7.4 for a discussion of the 
revisions to the PTO test cycle.
    The agencies will continue the hybrid-PTO test option that was 
available in Phase 1, with a few revisions. See the regulations at 40 
CFR 1037.540. The calculations recognize fuel savings over a portion of 
the test that is determined to be charge-sustaining as well as a 
portion that is determined to be charge-depleting for systems that are 
designed to power a work truck during the day and return to the garage 
where recharging from an external source occurs during off-hours. The 
agencies requested comment on this idea, and received comment from 
Odyne relating to the population and energy storage capacity of plug-in 
e-PTO systems, for which a charge-depleting test cycle may be more 
appropriate. We also partnered with DOE-NREL to characterize the PTO 
operation of over 80 trucks with over 1,500 total operating days, and 
our final regulations include a utility factor table based on these 
data for use in determining the effectiveness of a hybrid PTO 
system.\435\ Manufacturers wishing to conduct testing as specified may 
apply for off-cycle credits derived from e-PTO or hybrid PTO 
technologies.
---------------------------------------------------------------------------

    \435\ National Renewable Energy Laboratory July 2016, 
``Characterization of PTO and Idle Behavior for Utility Vehicles,'' 
NREL/TP-5400-66747.
---------------------------------------------------------------------------

(2) Projected Vehicle Technology Package Effectiveness and Cost
(a) Baseline Vocational Engine and Vehicle Performance
    The baseline vocational vehicle configurations for each of the nine 
regulatory subcategories for CI-powered and six SI-powered vehicles are 
described in RIA Chapter 2.9.1, as well as the seven baseline custom 
chassis configurations. The agencies set the baseline rolling 
resistance coefficient for the 2017 vocational vehicle fleet at 7.7 kg/
metric ton, which assumes that 100 percent of tires meet the Phase 1 
standard.
    In the agencies' Phase 2 baseline configurations, we need to 
specify transmission type, gear number, and gear ratios, as well as 
axle ratios and tire sizes because these were all defaults in Phase 1. 
Phase 1 GEM modeled all vehicles with a manual transmission, but as 
explained elsewhere, the majority of vocational vehicles in today's 
U.S. fleet have automatic transmissions. By specifying a mix of manual 
and automatic transmissions with different sets of gears in the 
baseline, we are not applying technology beyond what is needed to 
comply with Phase 1, we are merely defining an appropriate set of 
baselines. We do not consider these specifications to represent 
technology that improves fuel efficiency beyond Phase 1, it is merely a 
better representation of today's fleet than the Phase 1 GEM that had 
100 percent default manual transmissions. In the Regional HHD diesel 
subcategory, the baseline is a weighted average of two vehicle specs: 
95 percent being a 455 hp engine paired with a manual transmission with 
ten forward gears, and five percent being a 350 hp engine paired with a 
6-speed automatic transmission. The HHD Multipurpose subcategory is a 
weighted average of three vehicle specs: 80 percent being a 350 hp 
engine paired with a 6-speed automatic transmission, 10 percent being a 
455 hp engine paired with a 10-speed manual transmission, and 10 
percent being a 350 hp engine paired with a 10-speed manual. The 
automatic transmissions specified in the LHD, MHD, and HHD Regional and 
Multipurpose subcategories have six forward gears in the baseline, 
while automatic transmissions in the Urban subcategories have five 
forward gears in the baseline. This is based on market research, 
stakeholder outreach, and comments received on the NODA. No vehicle-
level efficiency-improving technology is included in the baseline 
vehicles, nor in the agencies' analyses for the no-action reference 
case. Specifically, we have assumed zero adoption rates for other types 
of transmissions, other numbers of gears, idle reduction, and 
technologies other than Phase 1 compliant LRR tires in both the 
nominally flat baseline and the dynamic baseline reference cases. 
Technology adoption rates for Alternative 1a (nominally flat baseline) 
can be found in the RIA Chapter 2.11. Chapter 2.11.8 presents the 
adoption rates for tires on vocational vehicles with different levels 
of rolling resistance, including the 100 percentadoption rate of tires 
with Level 1 CRR in the reference case and in model years preceding 
Phase 2. In this manner, we have defined a reference vocational vehicle 
fleet that meets the Phase 1 standards and includes reasonable 
representations of vocational vehicle technology and configurations.
    The agencies note that the baseline performance derived for the 
final rules varies between regulatory subcategories--as noted above, 
this is one of the reasons the agencies are adopting multiple 
subcategories with discrete standards. The range of performance at 
baseline is due to the range of attributes and modeling parameters, 
such as transmission characteristics, final drive ratio, and vehicle 
weight, which were selected to represent a range of performance across 
this diverse segment. The agencies received persuasive comment 
regarding the appropriateness of the baseline configurations, and have 
made revisions accordingly. For example, we have reduced the LHD 
default aerodynamic drag area from 5.4 to 3.4 square meters. We are 
confident these adequately represent a reasonable range of vocational 
chassis configurations currently manufactured in the US. Details of the 
vehicle configurations, including reasons why they are reasonably 
included as baseline technologies, are discussed in the RIA Chapter 
2.9.2.
    At proposal the agencies adjusted the vocational vehicle GEM 
numerical baselines using assumptions about the sales mix in the 
vocational fleet before applying the reductions from technologies. 80 
FR 40308. In this process, we developed proposed baseline values that 
we believed would minimize inappropriate incentives for manufacturers 
to certify chassis in an inappropriate subcategory. The proposed 
approach included testing each baseline vehicle over all three duty 
cycles and applying weighted average adjustments to each GEM output to 
create normalized baselines, 80 FR 40308. We received adverse comment 
on this approach from many commenters--indeed, no commenter supported 
this ``normalization'' approach. The proposed normalization approach 
was an attempt to adjust for instances where the agencies' information 
on baseline configurations was not fully complete. Most commenters 
either opposed or were confused by the proposed normalization process. 
As explained in this Section V., the agencies are adopting final 
standards for vocational vehicles using the same methodology as for all 
the other standards in this rulemaking, and

[[Page 73706]]

so are neither normalizing nor equalizing any of the data relating to 
either the baseline or the standard. (Equalization is discussed 
separately in Section V.C.(2)(d) below.) The agencies have received a 
great deal of information from manufacturers since proposal which 
rectify weaknesses in our baselines, and make any normalization 
unnecessary.\436\ In the final rules we have applied other methods 
(chiefly certain equipment-based constraints) to avoid creating 
inappropriate incentives for manufacturers to certify chassis in 
inappropriate subcategories. The final standards are calculated by 
applying improvements as described below in Section V.C.(2)(c) to the 
GEM results presented in Table V-17 and Table V-18--the same 
methodology as used to develop the other Phase 2 standards.
---------------------------------------------------------------------------

    \436\ See memorandum dated July 2016 titled, ``Summary of 
Comments on Vocational Vehicle Baselines,'' see Docket EPA-HQ-OAR-
2014-0827.
---------------------------------------------------------------------------

    Diesel engines used in vocational vehicles can be either Light, 
Medium, or Heavy Heavy-duty Diesel engines. The Light Heavy-duty Diesel 
engines typically range between 4.7 and 6.7 liters displacement. The 
Medium Heavy-duty Diesel engines typically have some overlap in 
displacement with the Light Heavy-duty Diesel engines and range between 
6.7 and 9.3 liters. The Heavy Heavy-duty Diesel engines typically are 
represented by engines between 10.8 and 16 liters. Because of these 
differences, the GEM simulation of baseline vocational CI engines 
includes four engines--one for LHD, one for MHD, and two for HHD. 
Detailed descriptions can be seen in Chapter 4 of the RIA. These four 
engine models have been employed in setting the vocational vehicle 
baselines, as described in the RIA Chapter 2.9.1.
    The four baseline diesel engines represent fuel consumption 
improvements beyond currently available engines to achieve the 
performance level of a 2017 model year diesel engine, as described in 
the RIA Chapter 2.9.1. Using the values for compression-ignition 
engines, the baseline performance of vocational vehicles is shown in 
Table V-17.

                       Table V-17--Baseline Vocational Vehicle Performance With CI Engines
----------------------------------------------------------------------------------------------------------------
                                                                   Light  heavy-  Medium  heavy-
                           Duty cycle                             duty  Class 2b- duty  Class 6-   Heavy  heavy-
                                                                         5               7         duty  Class 8
----------------------------------------------------------------------------------------------------------------
                            Baseline Emissions Performance in CO[ihel2] gram/ton-mile
----------------------------------------------------------------------------------------------------------------
Urban...........................................................             482             332             338
Multi-Purpose...................................................             420             294             287
Regional........................................................             334             249             220
----------------------------------------------------------------------------------------------------------------
                        Baseline Fuel Efficiency Performance in gallon per 1,000 ton-mile
----------------------------------------------------------------------------------------------------------------
Urban...........................................................         47.3477         32.6130         33.2024
Multi-Purpose...................................................         41.2574         28.8802         28.1925
Regional........................................................         32.8094         24.4597         21.6110
----------------------------------------------------------------------------------------------------------------

    The agencies have developed a model in GEM of a MY 2016-compliant 
gasoline engine. The agencies received comments on the process for 
mapping gasoline engines for simulation purposes, as well as 
information about the power rating and displacement that should be 
considered as a baseline SI engine for vocational vehicle standard-
setting purposes. Upon consideration of comments, and based on 
information obtained through testing at Southwest Research (see Chapter 
5.5 of the SwRI report), we are adopting revised test procedures as 
described in the RIA Chapter 3.1 that apply for mapping of both SI and 
CI engines.\437\
---------------------------------------------------------------------------

    \437\ Michael Ross, Validation Testing for Phase 2 Greenhouse 
Gas Test Procedures and the Greenhouse Gas Emission Model (GEM) for 
Medium and Heavy-Duty Engines and Powertrains, Final Report to EPA, 
Southwest Research Institute, June 2016.
---------------------------------------------------------------------------

    The baseline performance levels for vocational vehicles powered by 
SI engines were derived using the EPA default fuel map described in the 
RIA Chapter 2.9.1, for a 6.8 liter, V-8, 300 hp engine. We have used 
the same engine rating and map for all weight classes of SI vocational 
vehicles. This is because SI engines are not certified with a 
regulatory structure that calls for declaring an intended service class 
that is associated with a vehicle weight class. The agencies requested 
comments on the merits of setting distinct numerical standards for HHD 
vocational vehicles powered by SI engines, as well as comments on an 
alternative approach that would have required any class 8 SI vocational 
vehicles to certify to the standards for CI powered HHD vocational 
vehicles, or to the MHD standards for SI vocational vehicles. In 
response to comments expressing concern about orphaned vehicles as well 
as concerns about mismatched engine and vehicle useful life, the 
agencies are not finalizing distinct HHD SI vocational vehicle 
standards. We are finalizing six subcategories for SI vocational 
vehicles: Three LHD and three MHD. Where a manufacturer wishes to 
certify a gasoline SI vocational vehicle with a GVWR over 33,000 lbs, 
the final regulations allow that vehicle to be certified in one of the 
MHD vehicle subcategories. Where a manufacturer wishes to certify an 
alternative-fueled vocational vehicle with a GVWR over 33,000 lbs, the 
regulations at 40 CFR 1036.108 specify whether that vehicle should be 
treated as SI or CI for purposes of certification to the final Phase 2 
standards. See Section II.D.5 of this Preamble for a discussion of 
these provisions.
    Table V-18 presents the baseline performance level for each weight 
class computed by GEM by calculating the work done by the default 
engine to move the GEM reference vehicles over the test cycles.

[[Page 73707]]



   Table V-18--Baseline Vocational Vehicle Performance With SI Engines
------------------------------------------------------------------------
                                                         Medium  heavy-
                                    Light  heavy-duty   duty  Class 6-7
            Duty cycle                  Class 2b-5       (and  Gasoline
                                                            c8) \a\
------------------------------------------------------------------------
        Baseline Emissions Performance in CO[ihel2] gram/ton-mile
------------------------------------------------------------------------
Urban.............................                502                354
Multi-Purpose.....................                441                314
Regional..........................                357                275
------------------------------------------------------------------------
    Baseline Fuel Efficiency Performance in gallon per 1,000 ton-mile
------------------------------------------------------------------------
Urban.............................            56.4870            39.8335
Multi-Purpose.....................            49.6230            35.3325
Regional..........................            40.1710            30.9441
------------------------------------------------------------------------
Note:
\a\ Vocational vehicles with GVWR over 33,000 lbs powered by alternate
  fueled engines must certify to the vehicle standard corresponding with
  the applicable engine standard.

(b) Technology Packages for Derivation of Final Standards
    Prior to developing the numerical values for the final standards, 
the agencies projected the mix of new technologies and technology 
improvements that will be feasible within the available lead time. We 
note that for some technologies, the adoption rates and effectiveness 
may be very similar across subcategories. However, for other 
technologies, either the adoption rate, effectiveness, or both differ 
across subcategories. Where a technology performs differently over 
different test cycles, these differences are reflected in the 
derivation of the stringency of the standard. As discussed in Section 
I.C.1, we assume manufacturers will incorporate appropriate compliance 
margins for all measured GEM inputs. In other words, they will declare 
values slightly higher than their measured values. As discussed in 
Section II.D.5, compliance margins associated with fuel maps are likely 
to be approximately one percent. For tire rolling resistance, our 
feasibility rests on the Phase 1 standards, consistent with our 
expectation that manufacturers will continue to incorporate the 
compliance margins they considered necessary for Phase 1. With respect 
to optional axle and/or transmission power loss maps, we believe 
manufacturers will need very small compliance margins. These power loss 
procedures require high precision so measurement uncertainty will 
likely be on the order of 0.1 percent of the transmitted power. All of 
these margins are reflected in our projections of the emission levels 
that will be technologically feasible, as well as the associated costs.
    In the package descriptions that follow, individual technology 
costs are not presented, rather these can be found in the RIA Chapter 
2.9 and 2.11. Section V.C.(2)(d) includes the costs estimated for 
packages of technologies the agencies project can be applied to 
vocational vehicles to meet the final Phase 2 standards.
(i) Transmission Packages
    The agencies project an adoption rate of 50 percent in MY 2021, 60 
percent in MY 2024, and nearly 70 percent in MY 2027 of transmissions 
with improved gear efficiencies, with inputs over-riding the GEM 
defaults obtained over the separate transmission efficiency test. We 
are projecting an adoption rate of 10 percent in MY 2021, 20 percent in 
MY 2024, and nearly 30 percent in MY 2027 of advanced shift strategies, 
with demonstration of improvements recognized over the separate 
powertrain test.
    We are predicating the Phase 2 standards on zero adoption of added 
gears in the HHD Regional subcategory, because it is modeled with a 10-
speed transmission, and vehicles already using that number of gears are 
not expected to see any real world improvement by increasing the number 
of available gears. For the Multipurpose and Urban HHD subcategories, 
the MY 2021 projected adoption of adding gears is 5 percent, increasing 
to 10 percent for MY 2024 and MY 2027. We are projecting 10 percent of 
adding two gears in each of the other six subcategories for MY 2021, 
increasing to 20 percent for MY 2024 and MY 2027. Commenters supported 
the inclusion of this technology as part of the basis for the 
standards. Allison commented that they have configured an 8-speed 
vocational transmission. Eaton's new MHD dual clutch transmission has 
seven forward gears. There is also a likelihood that suppliers of 8-
speed transmissions for HD pickups and vans may sell some into the LHD 
vocational vehicle market.
    We are also predicating the optional custom chassis standards for 
school and coach buses in part on adoption of transmissions with 
additional gears. In MY 2021, this adoption rate is five percent, 
increasing to 10 percent in MY 2024 and 15 percent in MY 2027. 
Manufacturers who certify these vehicles to the primary standards will 
use GEM to model the actual gears and gear ratios; however, 
manufacturers using custom chassis regulatory subcategory identifiers 
will not have this flexibility. The agencies have estimated the cycle-
average benefit of adding an extra gear for school buses (modeled as 
MHD Urban vehicles) at 0.9 percent and coach buses (with 6 gears in the 
baseline) at 1.7 percent; therefore, manufacturers using custom chassis 
regulatory subcategory identifiers for these vehicles will be permitted 
to enter these pre-defined improvement values at the time of 
certification.
    Based on comment regarding our regulatory baselines, both the HHD 
Regional and HHD Multipurpose subcategories now have manual 
transmissions in the baseline configuration. For these vehicles, the 
agencies project upgrades to automated transmissions such as either 
AMT, DCT, or automatic, at an adoption rate of 30 percent in MY 2021, 
50 percent in MY 2024, and 80 percent in MY 2027 for Regional vehicles. 
For Multipurpose, beginning with 20 percent manuals in the baseline, 
the adoption rate of automated transmissions is five percent in MY 2021 
and 20 percent in MY 2024. Consistent with our projections of 
technology adoption, the regulations require that any vocational 
vehicles with manual transmissions must be certified as Regional in MY 
2024 and beyond. This progression of

[[Page 73708]]

transmission automation is consistent with the agencies' projection of 
10 percent manuals and 90 percent automated transmissions in the day 
cab tractor subcategories in MY 2027. See Table III-13. HHD vocational 
vehicles in regional service have many things in common with day cab 
tractors, including the same assumed engine size and typical 
transmission type, and a similar duty cycle. Thus, it is reasonable for 
the agencies to make similar projections about the fraction of 
automated vs manual transmissions adopted over the next decade among 
these sectors. Also consistent with tractors, GEM simulates each of 
these with a two percent fixed effectiveness improvement over the 
performance of the MT in the baseline. To the extent any of these 
transmissions provide additional effectiveness over the GEM cycles with 
actual OEM data entered, it is not considered in the stringency of the 
vocational vehicle HHD Regional standard (but would be recognized at 
certification). The agencies have been unable to characterize the 
relative effectiveness of DCT compared with AT sufficiently to apply it 
as a technology on which stringency is predicated. This is consistent 
with the public comment on this issue: Daimler did not support 
inclusion of DCT as a technology with different effectiveness than AMT, 
and Allison did not support treatment of either DCT or AMT as different 
as AT.
    In the seven subcategories (i.e. all of the remaining 
subcategories) in which automatic transmissions are the base 
technology, the agencies project that ten percent of the HHD vehicles 
will apply an aggressive torque converter lockup strategy in MY 2021, 
and 30 percent in the LHD and MHD subcategories. These adoption rates 
are projected to increase to 20 percent for HHD and 40 percent for LHD 
and MHD in MY 2024. We project adoption of aggressive torque converter 
lockup for HHD automatics of 30 percent in MY 2027, and 50 percent for 
LHD and MHD.
    In setting the standard stringency, we have projected that non-
integrated (bolt-on) mild hybrids will not have the function to turn 
off the engine at stop, while the integrated mild hybrids will have 
this function. The agencies have estimated the effectiveness for 
vehicles certified in the Urban subcategories will achieve as much as 
13 percent improvement, and integrated systems that turn off at stop 
will see up to 21 percent improvement depending on the subcategory. We 
have also projected zero hybrid adoption rate (mild or otherwise) by 
vehicles in the Regional subcategories, expecting that the benefit of 
hybrids for those vehicles will be too low to merit use of that type of 
technology. However, there is no fixed hybrid value assigned in GEM 
and, for any vehicles utilizing hybrid technology, the actual 
improvement over the applicable test cycle will be determined by 
powertrain testing, which would likely reflect some benefit of hybrids 
on Regional vehicles. By the full implementation year of MY 2027, the 
agencies are projecting an overall vocational vehicle adoption rate of 
12 percent mild hybrids, which we estimate will be 14 percent of 
vehicles certified in the Multi-Purpose and Urban subcategories (six 
percent integrated and eight percent non-integrated). We are projecting 
a low adoption rate in the early years of the Phase 2 program, zero 
integrated hybrid systems and two percent of the bolt-on systems in 
these subcategories in MY 2021, and three percent integrated mild 
hybrids in MY 2024 for vehicles certified in the Multi-Purpose and 
Urban subcategories, plus 5 percent non-integrated mild hybrids in MY 
2024. Based on our assumptions about the populations of vehicles in 
different subcategories, these hybrid adoption rates are about two 
percent overall in MY 2021 and six percent overall in MY 2024.
    Navistar commented with concerns that the agencies may be double 
counting some of the improvements of deep integration. For example, the 
addition of a gear to a transmission may reduce the added benefit of 
deep integration, as the transmission may already achieve a more 
optimal operation state more often due to the greater number of gears. 
The agencies have been careful to project adoption rates and 
effectiveness of transmission technologies in a way that that avoids 
over-estimating the achievable reductions. For example, as we developed 
the packages, we reduced the adoption rate of advanced shift strategy 
by the adoption rate of integrated hybrids, and we reduced the adoption 
rate of transmission gear efficiency by the amount of non-integrated 
hybrids. This is because we do not project that any driveline will 
undergo testing over both the powertrain test and the separate 
transmission efficiency test. Because we have projected adoption of 
combinations of transmission technologies in some subcategories, the 
sum of adoption rates of individual transmission technologies may 
exceed 100 percent in some cases. However, the effectiveness values 
have not been summed because we agree with the commenter that we should 
not double count benefits. Instead of summing the combined 
efficiencies, we combine multiplicatively as described in Equation V-1, 
below. Thus, we have fairly accounted for dis-synergies of 
effectiveness where multiple technologies are applied to a similar 
vehicle system.
    Custom chassis manufacturers have provided compelling comment that 
the absence of recognition in the certification process of improved 
transmission technology will not deter them from its adoption. 
Therefore, although some types of improved transmissions are feasible 
for some custom chassis, these vehicles are typically assembled from 
off-the-shelf parts in low production volumes. For most components, 
this is not a significant obstacle. However, this dynamic can limit 
their access to the most advanced transmission technologies. 
Transmission manufacturers would generally be willing to supply 
advanced transmissions they developed for a larger customer, but would 
be less likely to invest in developing a special low volume 
transmission for the custom chassis. Similar circumstances would apply 
for hybrids. Further, for the reasons described above about non-
representative drivelines in the baseline configurations, we believe 
that allowing these to be certified with a default driveline is a 
reasonable program structure. For school buses and others, if a 
manufacturer wishes to be recognized beyond the levels described for 
adopting improved transmissions, it has the option of certifying to the 
primary standards. Nevertheless, technology improvements that some of 
these manufacturers will include based on market forces (after they 
have been introduced into the market as a result of the primary 
program) will likely result in actual in-use improvements for many 
these vehicles beyond what is projected by the standards.
(ii) Axle Packages
    The agencies project that 10 percent of vocational vehicles in all 
subcategories will adopt high efficiency axles in MY 2021, 20 percent 
in MY 2024, and 30 percent in MY 2027. Fuel efficient lubricant 
formulations are widespread across the heavy-duty market, though 
advanced synthetic formulations are currently less popular.\438\ Axle 
lubricants with improved viscosity and efficiency-enhancing performance 
are projected to

[[Page 73709]]

be widely adopted by manufacturers in the time frame of Phase 2. Such 
formulations are commercially available and the agencies see no reason 
why they could not be feasible for most vehicles. Nonetheless, we have 
refrained from projecting full adoption of this technology. The 
agencies do not have specific information regarding reasons why axle 
manufacturers may specify a specific type of lubricant over another, 
and whether advanced lubricant formulations may not be recommended in 
all cases. The agencies received adverse comment on allowing fixed 
credit for use of high efficiency axles, whether from lubrication or 
other mechanical designs. In response, we are adopting a separate axle 
efficiency test, which can be used as an input to GEM to over-ride 
default axle efficiency values. The low overall adoption rate indicates 
that we expect axle suppliers to only offer high-efficiency axles for 
their most high production volume products, especially those that can 
serve both the tractor and vocational market. Therefore, we believe it 
is unlikely that high-efficiency axles will be adopted in custom 
chassis applications. Because we are no longer offering a fixed 
improvement for this technology as at proposal, this is only available 
for vocational vehicles that are certified to the primary program.
---------------------------------------------------------------------------

    \438\ See meeting log for proposed rule, specifically the April 
2014 meeting with Dana. https://www.regulations.gov/document?D=EPA-HQ-OAR-2014-0827-0702
---------------------------------------------------------------------------

    The agencies estimate that 10 percent of HHD Regional vocational 
vehicles and five percent of HHD Multipurpose vehicles will adopt part 
time 6x2 axle technology in MY 2021. This technology is most likely to 
be applied to Class 8 vocational vehicles (with 2 rear axles) that are 
designed for frequent highway trips. The agencies project a 20 percent 
adoption rate for HHD Regional and 15 percent adoption rate for HHD 
Multipurpose for part time 6x2 axle technologies in MY 2024. In MY 
2027, we project 30 percent adoption of part time 6x2 for HHD Regional 
and 25 percent for HHD Multipurpose. We are establishing a custom 
chassis baseline configuration for coach buses with a 6x2 axle, in 
consideration of comments from UCS and manufacturers stating this is 
the standard axle configuration for these vehicles. If a HHD coach bus 
is sold with a 6x4 or part time 6x2 axle, the manufacturer must enter 
the as-built axle configuration as a GEM input. This is true whether 
the vehicle is in the primary program or if it is certified to the 
custom chassis standard. Because the optional custom chassis standard 
assumes a 6x2 axle in the coach bus baseline, manufacturers may only 
qualify to obtain a reduced GEM result from use of the 300 pound weight 
reduction value (specified in 40 CFR 1037.520 associated with use of a 
permanent 6x2 axle) when certifying coach buses to the primary 
standards.
(iii) Tire Packages
    The agencies estimate that the per-vehicle average level of rolling 
resistance from vocational vehicle tires could be reduced by up to 13 
percent for many vehicles by full implementation of the Phase 2 program 
in MY 2027, based on broader adoption of vocational vehicle tires 
currently available. We estimate this will yield reductions in fuel use 
and CO2 emissions of up to 3.3 percent for these vehicles. 
All of our estimates of vehicle-level tire CRR improvements employ a 
weighted average using an assumed axle load distribution of 30 percent 
on the steer tires and 70 percent on the drive tires, as was 
proposed.\439\ The projected adoption rates of tires with improved CRR 
for chassis in the primary program are presented in Table V-19. The 
levels noted in the table are defined above in Table V-15. By applying 
the assumed axle load distribution, the estimated vehicle CRR 
improvement projected as part of the MY 2021 standards ranges from 5 to 
8 percent, which we project will achieve up to 1.9 percent reduction in 
fuel use and CO2 emissions, depending on the vehicle 
subcategory. The agencies estimate the vehicle CRR improvement in MY 
2024 will range from 5 to 13 percent, yielding reductions in fuel use 
and CO2 emissions up to 3.2 percent, depending on the 
vehicle subcategory.
---------------------------------------------------------------------------

    \439\ See Vehicle Valuation Services Quick Reference Guide, 
available at. http://www.vvsi.com/training/TrainingGuide.pdf, 
(accessed June 2014), the draft RIA at Chapter 2.9.2, and Docket ID 
EPA-HQ-OAR-2014-0827-0434.
---------------------------------------------------------------------------

    The agencies believe that these tire packages recognize the variety 
of tire purposes and performance levels in the vocational vehicle 
market, and maintain choices for manufacturers to use the most 
efficient tires (i.e. those with lowest rolling resistance) only where 
it makes sense given these vehicles' differing purposes and 
applications.

                                                      Table V-19--Projected LRR Tire Adoption Rates
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                 Regional                              Multipurpose                                Urban
                                 -----------------------------------------------------------------------------------------------------------------------
                                         Steer               Drive               Steer               Drive               Steer               Drive
--------------------------------------------------------------------------------------------------------------------------------------------------------
2021 HHD........................  100% LRR 5v.......  100% LRR 2v.......  100% LRR 5v.......  100% LRR 2v.......  100% LRR 4v.......  100% LRR 1v.
2021 MHD........................  100% LRR 3v.......  100% LRR 1v.......  100% LRR 3v.......  100% LRR 1v.......  100% LRR 3v.......  100% LRR 1v.
2021 LHD........................  100% LRR 3v.......  100% LRR 3v.......  100% LRR 3v.......  100% LRR 3v.......  100% LRR 2v.......  100% LRR 2v.
2024 HHD........................  100% LRR 5v.......  100% LRR 3v.......  100% LRR 5v.......  100% LRR 2v.......  100% LRR 4v.......  100% LRR 1v.
2024 MHD........................  100% LRR 5v.......  100% LRR 3v.......  100% LRR 3v.......  50% LRR 1v, 50%     100% LRR 3v.......  100% LRR 1v.
                                                                                               LRR 2v.
2024 LHD........................  100% LRR 5v.......  100% LRR 3v.......  100% LRR 3v.......  100% LRR 3v.......  100% LRR 2v.......  100% LRR 2v.
2027 HHD........................  100% LRR 5v.......  100% LRR 3v.......  100% LRR 5v.......  100% LRR 3v.......  100% LRR 5v.......  100% LRR 2v.
2027 MHD........................  100% LRR 5v.......  100% LRR 3v.......  100% LRR 5v.......  100% LRR 3v.......  100% LRR 3v.......  50% LRR 1v, 50%
                                                                                                                                       LRR 2v.
2027 LHD........................  100% LRR 5v.......  100% LRR 3v.......  100% LRR 5v.......  100% LRR 3v.......  100% LRR 3v.......  50% LRR 2v, 50%
                                                                                                                                       LRR 3v.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Table V-20 presents the projected adoption rates of LRR tires for 
custom chassis. As noted above in Section V.C.(1)(a)(iii), the adoption 
rates generally represent improvements in the range of the 25th to 40th 
percentile using data from actual vehicles in each application that 
were certified in MY 2014. A summary of these data is provided in a 
memorandum to the docket.\440\ An exception to this is emergency 
vehicles. The final emergency vehicle standards reflect adoption of 
tires that progress to the 50th percentile by MY 2027, using steer and 
drive tire data for certified emergency vehicles. At these adoption 
rates, manufacturers need not change any of the tires they are 
currently fitting on emergency vehicles, and they will comply on 
average.
---------------------------------------------------------------------------

    \440\ See memorandum on tire data, Note 419, above.

[[Page 73710]]



                        Table V-20--Projected LRR Tire Adoption Rates for Custom Chassis
----------------------------------------------------------------------------------------------------------------
                                                  MY 2021                                 MY 2027
                                 -------------------------------------------------------------------------------
                                         Steer               Drive               Steer               Drive
----------------------------------------------------------------------------------------------------------------
Coach...........................  100% LRR 4v.......  100% LRR 4v.......  100% LRR 5v.......  100% LRR 5v.
RV..............................  100% LRR 5v.......  100% LRR 5v.......  100% LRR 5v.......  100% LRR 5v.
School..........................  100% LRR 4v.......  100% LRR 2v.......  100% LRR 5v.......  100% LRR 4v.
Transit.........................  100% LRR 1v.......  100% LRR 1v.......  100% LRR 3v.......  100% LRR 3v.
Refuse..........................  100% LRR 1v.......  100% LRR 1v.......  100% LRR 3v.......  100% LRR 3v.
Mixer...........................  100% LRR 2v.......  100% LRR 1v.......  100% LRR 3v.......  100% LRR 2v.
Emergency.......................  100% LRR 2v.......  100% LRR 1v.......  100% LRR 4v.......  100% LRR 1v.
----------------------------------------------------------------------------------------------------------------

(iv) Idle Reduction Packages
    In these rules, the adoption rate of AES for HHD Regional vehicles 
is 40 percent in MY 2021, 80 percent in MY 2024, and 90 percent in MY 
2027. This is because these vehicles have driving patterns with a 
significant amount of parked idle, and the vast majority have 
relatively modest accessory demands such that only a few would have 
such large demands for backup power that turning the engine off while 
parked would not be feasible. For all weight classes of Regional 
vehicles except coach buses, the neutral idle and stop start adoption 
rates remain zero in all model years because these vehicles have 
driving patterns with such a small amount of transient driving that 
this drive-idle technology would not likely provide real world 
benefits. For coach buses we are predicating the optional custom 
chassis standard in part on adoption of neutral idle for several 
reasons. First, according to Volvo, we are underestimating the amount 
of transient time for these vehicles by applying only a 20 percent 
weighting of the transient cycle instead of 25 percent as noted in 
their comment. Second, we estimate that neutral idle is a low cost 
technology that would easily pay for itself with the miles accumulated 
by coach buses. Finally, in the custom chassis program manufacturers 
are able to qualify for a reduced emission rate in GEM through 
selection of neutral idle even if the transmission architecture 
inherently functions with neutral idle such as with an AMT or DCT. The 
Regional vehicles carry a 40 percent, 80 percent, and 90 percent 
adoption rate of AES in MYs 2021, 2024, and 2027 respectively because 
these vehicles are not projected to apply any other idle reduction 
technology and as long as large accessory loads are not required this 
technology is widely feasible. As reflected in the Multipurpose and 
Urban duty cycles with an overall composite test weighting of zero 
speed operation of 50 percent with 25 percent composite weighting of 
the parked idle cycle, idle reduction is a significant technology for 
these vehicles. We are projecting 30 percent adoption of AES in all 
weight classes of Multipurpose and Urban vocational vehicles in MY 
2021, increasing to 60 percent in MY 2024 and 70% in MY 2027. This is 
less than for Regional because we expect a larger fraction of vehicles 
in these subcategories will need to run PTO or other accessories while 
parked, such that fewer will be able to reasonably apply the low-cost 
AES that we have identified in this rulemaking. Because we are 
considering stop-start and neutral idle to be mutually exclusive on a 
per-vehicle basis, the sum of these two technologies does not exceed 90 
percent in MY 2027, and gradually ramps up to this level from the 50 to 
60 percent range in MY 2021. Neutral idle adoption rates are greater in 
the early years because we expect this will not need much lead time, if 
any. An exception to the 90 percent maximum adoption rate is transit 
buses, where we believe all vehicles of this type can reasonably apply 
some form of drive idle reduction technology. The adoption rates of 
idle reduction technologies for vocational vehicles in MY 2027 is 
presented in Table V-21.

                                            Table V-21--MY 2027 Adoption Rates of Idle Reduction Technologies
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                Heavy heavy-duty                      Medium heavy-duty                       Light heavy-duty
                                    --------------------------------------------------------------------------------------------------------------------
             Technology                              Multi-                                 Multi-                                 Multi-
                                       Regional     purpose       Urban       Regional     purpose       Urban       Regional     purpose       Urban
--------------------------------------------------------------------------------------------------------------------------------------------------------
Neutral Idle.......................            0           70           70            0           60           60            0           60           60
Stop-Start.........................            0           20           20            0           30           30            0           30           30
AES................................           90           70           70           90           70           70           90           70           70
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Although it is possible that a vehicle could have both neutral idle 
and stop-start, our stringency calculations only consider emissions 
reductions where a vehicle either has one or the other of these 
technologies. The final GEM input file allows users to apply multiple 
idle reduction technologies within a single vehicle configuration.
    Because we have included costs to maintain engine protection during 
periods of shut-off, as well as over-rides to recognize instances where 
it may not be safe to shut off an engine, we believe stop-start can 
safely be applied at the rates described above in the time frames 
described. Also, because we have defined two idle cycles where the 
automatic engine shutoff technology addresses the condition of being 
parked with the brake off, we believe this alleviates many of the 
concerns expressed by commenters about stop-start. We believe many 
commenters were (erroneously) imagining that stop-start systems would 
be required to function during periods of extended parking.
    We agree with commenters that stop-start is not feasible for 
emergency vehicles and concrete mixers. We further believe that stop-
start would not provide any real world benefit for coach buses or motor 
homes. However, for school buses, transit buses, and refuse trucks, we 
believe stop-start is feasible and likely to result in real world 
benefits. The only custom chassis standards that we are basing on 
adoption of AES is school buses, because for the others, we believe the 
simple shutdown timer would be likely to encounter an over-ride 
condition frequently enough to yield a very small benefit from this 
technology. To make AES practical for a coach or transit bus for 
example, a much larger auxiliary power source would be needed than the 
one projected as part of this rulemaking. Although many school buses 
have voluntarily adopted idle reduction strategies for other reasons, 
we do not believe many have tamper-proof automatic shutdown systems.

[[Page 73711]]



                             Table V-22--Custom Chassis Workday Idle Adoption Rates
----------------------------------------------------------------------------------------------------------------
                   Technology                           MY              AES             NI          Stop-start
----------------------------------------------------------------------------------------------------------------
Coach...........................................            2021  ..............              40  ..............
                                                            2027  ..............              70  ..............
School..........................................            2021              30              60               5
                                                            2027              70              60              30
Transit.........................................            2021  ..............              60              10
                                                            2027  ..............              70              30
Refuse..........................................            2021  ..............              30               0
                                                            2027  ..............              50              20
----------------------------------------------------------------------------------------------------------------

    As described above, the agencies are excluding refuse trucks that 
do not compact waste from the optional custom chassis vocational 
vehicle standards. We believe trucks that do not compact waste have 
sufficiently low PTO operation (usually only while parked) to make 
application of drive idle reduction technologies (and other 
technologies projected for regular vocational chassis) quite feasible. 
Front-loading refuse collection vehicles tend to have a relatively low 
number of stops per day as they tend to collect waste from central 
locations such as commercial buildings and apartment complexes. Because 
these have a relatively low amount of PTO operation, we expect stop-
start will be reasonably effective for these vehicles. Rear-loading and 
side-loading neighborhood waste and recycling collection trucks are the 
refuse trucks where the largest number of stop-start and neutral idle 
over-ride conditions are likely to be encountered. Because chassis 
manufacturers, even those with small production volumes and close 
customer relationships, do not always know whether a refuse truck 
chassis will be fitted with a body designed for front loading, rear 
loading, or side loading, we are applying an adoption rate of 20 
percent stop-start in 2027 to refuse trucks certified as custom 
chassis. In the case where a chassis manufacturer certifies a refuse 
truck to the primary standards under the HHD Urban subcategory, the MY 
2027 adoption rate of stop-start is also 20 percent as shown in Table 
V-21. The stringency in both cases assumes a sufficiently capable stop-
start system to not require an excessive use of over-rides. 
Manufacturers opting to certify refuse trucks to the primary standards 
will have an option to be recognized for enhanced stop-start systems 
through the powertrain test.
    It may take some minor development effort to apply neutral idle to 
high-torque automatic transmissions designed for the largest vocational 
vehicles. Based on stakeholder input, the designs needed to avoid an 
uncomfortable re-engagement bump when returning to drive from neutral 
may require some engineering refinement as well as some work to enable 
two-way communication between engines and transmissions. Nonetheless, 
this technology should be available in the near term for many vehicles 
and is low cost compared to many other technologies we considered. 
Commenters asked for over-rides such as when on a steep hill and we 
agree and are adopting this provision.
    For the reasons described above, we see the above idle reduction 
technologies being technically feasible on the majority of vocational 
vehicles. The RIA Chapter 2.9.3.4 and RIA Chapter 2.9.5.1.4 provide 
additional discussion on workday idle reduction technologies for 
vocational vehicles.
(v) Weight Reduction Packages
    As described in the RIA Chapter 2.11.10.3, weight reduction is a 
relatively costly technology, at approximately $3 to $10 per pound for 
a 200-lb package. Even so, for vehicles in service classes where dense, 
heavy loads are frequently carried, weight reduction can translate 
directly to additional payload. The agencies project that modest weight 
reduction is feasible for all vocational vehicles. The agencies are 
predicating the final standards on adoption of weight reduction 
comparable to what can be achieved through use of aluminum wheels (an 
easy material switch that does not alter load distribution on the 
chassis). This package is estimated at 150 pounds for LHD and MHD 
vehicles, and 250 pounds for HHD vehicles, based on six and 10 wheels, 
respectively. This value is revised upward since proposal based on 
compelling comments from the Aluminum Association recommending that we 
set the same level of weight reduction for lightweight aluminum alloys 
as for regular aluminum, at 25 pounds per wheel. More details on these 
comments may be found in the Response to Comments Chapter 5. In MY 
2021, we project an adoption rate of 10 percent, 30 percent in MY 2024, 
and 50 percent in MY 2027 for all subcategories in the primary program.
    The agencies project manufacturers will have sufficient options of 
other components eligible for material substitution so that this level 
of weight reduction will be feasible even where aluminum wheels are not 
selected by customers. Based on comments, we have removed aluminum 
transmission cases and aluminum clutch housings from the vocational 
lookup table.
    We are not predicating the custom chassis standards on any use of 
weight reduction. We have learned that manufacturers of concrete 
mixers, refuse trucks, and some high end buses have already made 
extensive use of lightweighting technologies in the baseline fleet. We 
also received persuasive comment cautioning us not to base the school 
bus standards on weight reduction due to potential conflicts with 
safety standards. In considering this information, we are allowing all 
vehicles certified using custom chassis regulatory subcategory 
identifiers to make use of weight reduction as a compliance 
flexibility. We received compelling comment from UCS that weight 
reduction should be considered feasible for transit buses. Upon 
consideration of this comment as well as information regarding the 
preponderance of city buses with overloaded axles, we are predicating 
standard stringency for transit buses on use of aluminum wheels at the 
same adoption rate as for the primary program. See the RIA at Chapter 
2.9.5.1.5 for more information about transit bus axles.
(vi) Electrified Accessory Packages
    The agencies are predicating the final vocational vehicle standards 
in part on an adoption rate of five percent in MY 2021 of an 
electrified accessory package that achieves one percent fuel efficiency 
improvement. The discussion in Section V.C.(1)(a)(vi) describes some 
pre-defined e-accessory improvements that are available in GEM for all 
vocational vehicles. In MY 2024 we increase this adoption rate to ten 
percent, and in MY

[[Page 73712]]

2027 the projected adoption rate is 15 percent, applicable in all 
subcategories excluding custom chassis. Although we believe some 
components could be electrified for some custom chassis, we do not have 
sufficient information to estimate an incremental cost associated with 
electrifying the more complex systems on custom chassis such as buses, 
or to project a specific adoption rate for this type of improvement.
(vii) Tire Pressure System Packages
    The agencies are predicating the vocational vehicle standards in 
part on widespread adoption of tire pressure monitoring systems. These 
are readily accepted by fleets as a cost-effective safety and fuel-
saving measure. Because there may be some minor challenges in applying 
this technology to some vehicles where the payload and duty cycle lead 
to very high tire temperatures and pressures (as described above), we 
are applying a lower adoption rate to Urban and Multi-purpose vehicles 
than to Regional vehicles, as shown in Table V-23. We are applying 
similarly lower adoption rates for refuse trucks and transit buses. We 
are not predicating the emergency vehicle or cement mixer standards on 
adoption of TPMS.
    We are predicating the optional school bus, coach bus, transit bus, 
and refuse truck standards in part on limited adoption of automatic 
tire inflation systems (ATIS), as shown in Table V-23. These are more 
costly than TPMS, and require an onboard air supply and sometimes 
extensive plumbing of air lines.

                           Table V-23--Vocational Tire Pressure System Adoption Rates
----------------------------------------------------------------------------------------------------------------
                                                       TPMS                                    ATIS
           Technology            -------------------------------------------------------------------------------
                                      MY 2021         MY 2024         MY 2027         MY 2021         MY 2027
----------------------------------------------------------------------------------------------------------------
Regional........................              60              75              90  ..............  ..............
Multi-Purpose...................              50              65              80  ..............  ..............
Urban...........................              40              55              70  ..............  ..............
School..........................              70  ..............              80  ..............              20
Coach...........................              50  ..............              75              10              25
Transit.........................              40  ..............              50              10              20
Refuse..........................              40  ..............              50              10              15
Motor Home......................              60  ..............              90  ..............  ..............
----------------------------------------------------------------------------------------------------------------

(c) GEM Inputs for Derivation of Vocational Vehicle Standards
    To account for engine-level improvements consistent with those 
projected to meet Phase 2 vocational engine standards, and which will 
be reflected over the GEM vehicle test cycles, the agencies developed a 
suite of fuel consumption maps for use with the GEM: One set of maps 
that represent engines meeting the MY 2021 vocational diesel engine 
standards, a second set of maps representing engines meeting the MY 
2024 vocational diesel engine standards, and a third set of maps 
representing engines meeting the MY 2027 vocational diesel engine 
standards.\441\ By incorporating the engine technology packages 
projected to be adopted to meet the Phase 2 vocational CI engine 
standards, the agencies employed GEM engine models in deriving the 
stringency of the Phase 2 CI-powered vocational vehicle standards. 
Similarly, to account for the performance of Phase 2 SI engines in 
deriving the stringency of the Phase 2 SI-powered vocational vehicle 
standards, the agencies employed our baseline SI GEM engine model. The 
extra engine technology on which the Phase 2 SI vocational vehicle 
standards are based was applied in post-processing the GEM results, not 
modeled with an improved GEM map. See the RIA Chapter 2.9.1 for more 
details about the vocational engines used in standard-setting.
---------------------------------------------------------------------------

    \441\ See Section II.D.2 of this Preamble for the derivation of 
the engine standards.
---------------------------------------------------------------------------

    The derivation of the vocational vehicle standards incorporates 
several methods because some GEM inputs lend themselves to fleet-
average values, some are vehicle specific (either on or off) and some 
improvements are not directly modeled in GEM. For each model year of 
standards, the agencies derived a scenario vehicle for each subcategory 
using the future model year engine map with fleet average input values 
for tire rolling resistance and weight reduction. For example, the MY 
2021 HHD weight reduction input value was derived as follows: 250 
pounds times 10 percent adoption yields 25 pounds. Those scenario 
vehicle performance results were combined in a post-process method with 
subcategory-specific improvements from idle reduction, axle disconnect, 
torque converter lockup, and transmission automation, using directly 
modeled GEM improvements comparing results with these technologies on 
or off the scenario vehicle. Subsequently, these performance values 
were combined with estimated improvement values of technologies not 
modeled in GEM, including TPMS, hybrids, and transmission gear 
efficiency.
    The set of fleet-average inputs for tire CRR and weight reduction 
for MY 2021, as modeled in GEM is shown in Table V-24, along with the 
respective adoption rates for idle reduction, axle disconnect, and 
torque converter lockup. The agencies derived the level of the MY 2024 
standards by using the GEM inputs and adoption rates shown in Table V-
25, below. The agencies derived the level of the MY 2027 standards by 
using the GEM inputs and adoption rates shown in Table V-26, below. 
Post-processing improvements for technologies not directly modeled, 
including TPMS, e-accessories, hybrids, and axle and transmission 
improvements are presented as a combined driveline improvement factor 
in Table V-27, below. The values in this table for SI-powered 
vocational vehicles include improvements due to adoption of SI engine 
technology. The methodology for estimating these improvements is 
described in the RIA Chapter 2.9.1. The final standards are presented 
in Table V-4 through Table V-9.

[[Page 73713]]



                                    Table V-24--GEM Inputs Used To Derive Final MY 2021 Vocational Vehicle Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   Class 2B-5                                                  Class 6-7                            Class 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Multi-                              Multi-                              Multi-
                          Urban                             purpose    Regional      Urban      purpose    Regional      Urban      purpose    Regional
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      SI Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                             2018 MY 6.8L, 300 hp engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        CI Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                            2021 MY 7L, 200 hp Engine          2021 MY 7L, 270 hp Engine        2021 MY
                                                                                               11L, 350
                                                                                              hp Engine     2021 MY 11L, 350 hp
                                                                                                          Engine and 2021 MY 15L
                                                                                                              455hp Engine a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Torque Converter Lockup in 1st (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
30%.....................................................        30%         30%         30%         30%         30%         10%         10%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          6 x 2 Disconnect Axle (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
0%......................................................         0%          0%          0%          0%          0%          0%          5%         10%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   AES (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
30%.....................................................        30%         40%         30%         30%         40%         30%         30%         40%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Stop-Start (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
10%.....................................................        10%          0%         10%         10%          0%          0%          0%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Neutral Idle (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
50%.....................................................        50%          0%         50%         50%          0%         50%         50%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Steer Tires (CRR kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
7.......................................................        6.8         6.8         6.8         6.7         6.7         6.4         6.2         6.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Drive Tires (CRR kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
7.2.....................................................        6.9         6.9         7.8         7.5         7.5         7.8         7.5         7.5
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  Weight Reduction (lb)
--------------------------------------------------------------------------------------------------------------------------------------------------------
15......................................................         15          15          15          15          15          25          25          25
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ The Multipurpose and Regional HHD standards are established using averages of configurations with different engines as described in RIA Chapter
  2.9.2.


                                    Table V-25--GEM Inputs Used To Derive Final MY 2024 Vocational Vehicle Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   Class 2b-5                                                  Class 6-7                            Class 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Multi-                              Multi-                              Multi-
                          Urban                             purpose    Regional      Urban      purpose    Regional      Urban      purpose    Regional
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      SI Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                             2018 MY 6.8L, 300 hp engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        CI Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                            2024 MY 7L, 200 hp Engine          2024 MY 7L, 270 hp Engine        2024 MY
                                                                                               11L, 350
                                                                                              hp Engine     2024 MY 11L, 350 hp
                                                                                                          Engine and 2024 MY 15L
                                                                                                              455hp Engine a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Torque Converter Lockup in 1st (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
40%.....................................................        40%         40%         40%         40%         40%         20%         20%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 73714]]

 
                                                          6 x 2 Disconnect Axle (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
0%......................................................         0%          0%          0%          0%          0%          0%         15%         20%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   AES (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
60%.....................................................        60%         80%         60%         60%         80%         60%         60%         80%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Stop-Start (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
20%.....................................................        20%          0%         20%         20%          0%         10%         10%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Neutral Idle (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
70%.....................................................        70%          0%         70%         70%          0%         70%         70%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Steer Tires (CRR kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
7.0.....................................................        6.8         6.2         6.8         6.7         6.2         6.4         6.2         6.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Drive Tires (CRR kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
7.2.....................................................        6.9         6.9         7.8         7.5         6.9         7.8         7.5         6.9
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  Weight Reduction (lb)
--------------------------------------------------------------------------------------------------------------------------------------------------------
45......................................................         45          45          45          45          45          75          75          75
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ The Multipurpose and Regional HHD standards are established using averages of configurations with different engines as described in RIA Chapter
  2.9.2.


                                    Table V-26--GEM Inputs Used To Derive Final MY 2027 Vocational Vehicle Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   Class 2b-5                                                  Class 6-7                            Class 8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Multi-                              Multi-                              Multi-
                          Urban                             purpose    Regional      Urban      purpose    Regional      Urban      purpose    Regional
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      SI Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                             2018 MY 6.8L, 300 hp engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        CI Engine
--------------------------------------------------------------------------------------------------------------------------------------------------------
                            2027 MY 7L, 200 hp Engine          2027 MY 7L, 270 hp Engine        2027 MY
                                                                                               11L, 350
                                                                                              hp Engine     2027 MY 11L, 350 hp
                                                                                                          Engine and 2027 MY 15L
                                                                                                              455hp Engine a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Torque Converter Lockup in 1st (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
50%.....................................................        50%         50%         50%         50%         50%         30%         30%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          6 x 2 Disconnect Axle (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
0%......................................................         0%          0%          0%          0%          0%          0%         25%         30%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   AES (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
70%.....................................................        70%         90%         70%         70%         90%         70%         70%         90%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Stop-Start (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
30%.....................................................        30%          0%         30%         30%          0%         20%         20%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Neutral Idle (adoption rate)
--------------------------------------------------------------------------------------------------------------------------------------------------------
60%.....................................................        60%          0%         60%         60%          0%         70%         70%          0%
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 73715]]

 
                                                             Steer Tires (CRR kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
6.8.....................................................        6.2         6.2         6.7         6.2         6.2         6.2         6.2         6.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Drive Tires (CRR kg/metric ton)
--------------------------------------------------------------------------------------------------------------------------------------------------------
6.9.....................................................        6.9         6.9         7.5         6.9         6.9         7.5         6.9         6.9
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  Weight Reduction (lb)
--------------------------------------------------------------------------------------------------------------------------------------------------------
75......................................................         75          75          75          75          75         125         125         125
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ The Multipurpose and Regional HHD standards are established using averages of configurations with different engines as described in RIA Chapter
  2.9.2.


                                                  Table V-27--Vocational Driveline Improvement Factors
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  Class 2b-5                       Class 6-7                         Class 8
                                                      --------------------------------------------------------------------------------------------------
                                                                    Multi-                           Multi-                           Multi-
                                                         Urban     purpose    Regional    Urban     purpose    Regional    Urban     purpose    Regional
--------------------------------------------------------------------------------------------------------------------------------------------------------
CI 2021..............................................      0.019      0.018      0.018      0.019      0.019      0.019      0.019      0.018      0.017
CI 2024..............................................      0.041      0.036      0.029      0.041      0.036      0.029      0.040      0.036      0.026
CI 2027..............................................      0.061      0.053      0.037      0.061      0.053      0.037      0.060      0.052      0.034
SI 2021..............................................      0.027      0.026      0.026      0.028      0.027      0.027  .........  .........  .........
SI 2024..............................................      0.048      0.044      0.037      0.049      0.044      0.037  .........  .........  .........
SI 2027..............................................      0.067      0.059      0.045      0.068      0.060      0.045  .........  .........  .........
--------------------------------------------------------------------------------------------------------------------------------------------------------

(d) Role of Fleet Averaging and Constraints in Vocational Vehicle 
Standards
    In part to avoid potentially creating incentives to misclassify 
vehicles, the agencies proposed to ``equalize'' the standards for each 
of the subcategories. 80 FR 40308. Thus, at proposal, the standards for 
the Regional, Multipurpose, and Urban subcategories reflected the 
arithmetic mean of the Regional, Multipurpose and Urban stringency 
levels (i.e., all three drive cycle subcategory percent improvements 
averaged together) in each weight class.\442\ Most commenters 
criticized this proposed approach. For example, Navistar commented that 
equalization could inappropriately benefit one manufacturer over 
another based on their product mix. We also note that the equalization 
process, if adopted, would have made the standards for the Regional 
vehicles unattainable using the technology pathway identified by the 
agencies, thus motivating manufacturers to select less appropriate test 
cycles for vehicles that are designed for Regional service. Therefore, 
we have decided not to apply ``equalization'' for finalizing the 
vocational vehicle standards. Instead, we have developed the final 
vocational vehicle standards using the same methodology as for all of 
the other Phase 2 standards, where we apply fleet average technology 
mixes to fleet average baseline vehicle configurations, and each 
average baseline and technology mix is unique for each vehicle 
subcategory. Along with this standard-setting approach, the agencies 
are also adopting certain interim constraints on the otherwise 
generally manufacturer-selected assignment of vehicle configurations to 
one of the three drive cycle subcategories, as explained in Section 
V.D.(1)(e) below.
---------------------------------------------------------------------------

    \442\ See proposed rules at 80 FR 40308, July 13, 2015.
---------------------------------------------------------------------------

    Elsewhere in this rulemaking we present overall costs and benefits, 
which are based our projected distribution of vocational vehicles in 
each subcategory. This projection includes our most updated population 
distributions by weight class, which we have adjusted in part in 
response to comments on the draft NREL report in the NODA and based on 
an analysis of telematics data from Ryder's leased vehicles. We intend 
to monitor whether our projection of distribution of vehicles among 
subcategories is consistent with outcomes. Under the three drive cycle 
subcategory structure, manufacturers must use good engineering judgment 
(subject to the provisions of 40 CFR 1068.5) to choose a subcategory 
for each vehicle configuration that represents the type of operation 
the vehicle is configured to experience in use, and the agencies expect 
the manufacturer and customer to specify a technology mix that is most 
effective for that vehicle's likely operation. In other words, as long 
as manufacturers work with their customers, the general rule describing 
this greater flexibility in choice of subcategory could be that the 
``customer knows best.'' In fact, our standards are predicated on the 
premise that willful misclassification not reflecting good engineering 
judgment will be rare, and thus environmentally inconsequential.
    In considering our approach for setting the final standards, we 
compared the relative stringencies in each subcategory with each 
respective baseline, and we observed that Regional vehicles are 
generally able to achieve the smallest percent improvement from the 
lowest (most efficient) baseline. By contrast, the Urban vehicles are 
generally able to achieve the greatest percent improvement from the 
highest (least efficient) baseline. We are not particularly concerned 
that adopting final standards with these unequal percent improvements 
poses a danger of losing environmental benefits from this

[[Page 73716]]

program, as long as vehicle configurations are properly classified at 
the time of certification. To test the potential impacts of 
misclassification, we compared the performance of each of our baseline 
configurations over all three drive cycles. This analysis is presented 
in a memorandum to the docket.\443\ Results for LHD and MHD weight 
classes were generally consistent with the rule's projections across 
each drive cycle. Results for HHD were equivocal in some instances, 
particularly for our baseline vehicles equipped with manual 
transmissions. This issue appears to be related to both the difference 
in the weighting of time spent in the drive idle mode in the Regional 
versus Urban and Multi-purpose drive cycles, and whether or not 
automatic transmissions are part of a baseline. In the analysis, that 
combination of circumstances showed how manual transmission-equipped 
vehicles could potentially become credit generators without any further 
addition of technology, if certified to the Urban or Multi-purpose 
cycles. The agencies are concerned that if this circumstance were to be 
left unconstrained, it could create an incentive to misclassify some 
Regional vehicles into one of the other two drive cycle subcategories, 
even though manual transmissions are generally best suited for Regional 
driving patterns, as discussed further below.
---------------------------------------------------------------------------

    \443\ See spreadsheet file dated July 2016 titled, 
VocationalStringencyComparison.xlsx.
---------------------------------------------------------------------------

    In light of this analysis, and consistent with recent comments from 
chassis manufacturers mentioned above in Section V.B.(1)(a), the 
agencies are adopting some constraints to the otherwise generally 
manufacturer-selected assignment of vocational chassis to regulatory 
subcategories. These constraints are described in Section V.D.(1)(e). A 
subset of the constraints prevents inappropriate classification based 
on transmission type. These constraints restrict classification options 
where a vocational vehicle is certifying with a manual transmission or 
in some cases an automated manual transmission. We are adopting these 
constraints as interim provisions in response to manufacturers' 
concerns that the manual transmission constraints could present 
competitive disadvantages, where different manufacturers produce very 
different sales mixes of vehicles equipped with different transmission 
types.\444\ However, at this time the final program structure, 
including these constraints, will remain in place unless and until the 
agencies determine that revisions to the vocational vehicle program 
structure are warranted, in which case the agencies would undertake a 
notice and comment rulemaking proposing to amend the programmatic 
structure, consistent with such a determination.
---------------------------------------------------------------------------

    \444\ See memorandum dated July 2016 titled, ``Summary of Late 
Comments on Vocational Transmissions and N/V.''
---------------------------------------------------------------------------

    It is important to clarify that we would consider all relevant 
factors together before deciding whether to propose any revisions. If 
we find that a significant discrepancy arises between our projections 
and outcomes, such that our estimated GHG and fuel consumption benefits 
are not being achieved because of the program structure, we may revisit 
relevant aspects of the program structure, including the drive cycles, 
subcategories and classification constraints. If we propose to revise 
the structure in the future, it might also be necessary to propose 
revising the numerical values of the standards to maintain equivalence 
with the final stringency being established in this rulemaking. We 
would of course find it acceptable if manufacturers implemented more 
cost-effective technologies than we projected, while still achieving 
the projected reductions in use. Similarly, if the structure results in 
manufacturers generally adopting the projected cost-effective 
technologies on the appropriate vehicles, but somehow this fails to 
fully achieve the projected reductions in use, we do not believe 
revisions necessarily would be warranted.
(e) Technology Package Costs Associated With Primary Vocational Vehicle 
Standards
    The agencies have estimated the costs of the technologies that 
could be used to comply with the final Phase 2 vocational vehicle 
standards. The estimated costs are shown in Table V-28 for MY 2021, in 
Table V-29 for MY 2024, and Table V-30 for MY 2027. Fleet average costs 
are shown for light, medium and heavy HD vocational vehicles in each 
duty-cycle-based subcategory--Urban, Multi-Purpose, and Regional. As 
shown in Table V-28, in MY 2021 these range from approximately $900 for 
MHD and LHD Regional vehicles, up to $2,600 for HHD Regional vehicles. 
Those two lower-cost packages reflect zero hybrids, and the higher-cost 
package reflects significant adoption of automated transmissions. Many 
changes have been made to the cost estimates since proposal. In the RIA 
Chapter 2.12.2, the agencies present vocational vehicle technology 
package costs differentiated by MOVES vehicle type. These costs do not 
indicate the per-vehicle cost that may be incurred for any individual 
technology. For more specific information about the agencies' estimates 
of per-vehicle costs, please see the RIA Chapter 2.11. The engine costs 
listed represent the cost of an average package of diesel engine 
technologies as set out in Section II. Individual technology adoption 
rates for engine packages are described in Section II.D. For gasoline 
vocational vehicles, the agencies are projecting adoption of Level 2 
engine friction reduction plus cylinder deactivation (i.e., all engine 
improvements are reflected exclusively in the vehicle standard) for an 
estimated $138 added to the average SI vocational vehicle package cost 
beginning in MY 2021. Further details on how the SI vocational vehicle 
costs were estimated are provided in the RIA Chapter 2.9.
    The details behind all these costs are presented in RIA Chapter 
2.11, including the markups and learning effects applied and how the 
costs shown here are weighted to generate an overall cost for the 
vocational segment. These estimates have changed significantly from 
those presented in the proposal, due to changes in projected technology 
adoption rates as well as changes in direct costs that reflect comments 
received.

                              Table V-28--Final Vocational Vehicle Technology Incremental Costs in the 2021 Model Year a b
                                                                         [2013$]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Light HD                        Medium HD                         Heavy HD
                                                      --------------------------------------------------------------------------------------------------
                                                                    Multi-                           Multi-                           Multi-
                                                         Urban     purpose    Regional    Urban     purpose    Regional    Urban     purpose    Regional
--------------------------------------------------------------------------------------------------------------------------------------------------------
Engine \c\...........................................       $298       $298       $298       $275       $275       $275       $275       $275       $275

[[Page 73717]]

 
Tires................................................          0         27         27          9          9          9         13         13         13
Tire Pressure Monitoring.............................        123        154        184        123        154        184        233        292        350
Transmission.........................................        217        217        217        217        217        217        186        413      1,519
Axle related.........................................         13         13         13         13         13         13         20         26         32
Weight Reduction.....................................         69         69         69         69         69         69        250        250        250
Idle reduction.......................................        155        155         12        160        160         12         68         68         12
Hybridization........................................        178        178          0        178        178          0        178        178          0
Air Conditioning \d\.................................         22         22         22         22         22         22         22         22         22
Other \e\............................................         30         30         30         49         49         49         89         89         89
                                                      --------------------------------------------------------------------------------------------------
    Total............................................      1,106      1,164        873      1,116      1,146        851      1,334      1,625      2,562
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ Costs shown are for the 2021 model year and are incremental to the costs of a vehicle meeting the Phase 1 standards. These costs include indirect
  costs via markups along with learning impacts. For a description of the markups and learning impacts considered in this analysis and how it impacts
  technology costs for other years, refer to Chapter 2 of the RIA (see RIA 2.11).
\b\ Note that values in this table include adoption rates. Therefore, the technology costs shown reflect the average cost expected for each of the
  indicated vehicle classes. To see the actual estimated technology costs exclusive of adoption rates, refer to Chapter 2 of the RIA (see RIA 2.11 in
  particular).
\c\ Engine costs are for a light HD, medium HD or heavy HD diesel engine. We are projecting $138 of additional costs beyond Phase 1 for gasoline
  vocational engines.
\d\ EPA's air conditioning standards are presented in Section V.C above.
\e\ Other incremental technology costs include electrified accessories and advanced shift strategy.

    The estimated fleet average vocational vehicle package costs are 
shown in Table V-29 for MY 2024. As shown, these range from 
approximately $1,300 for MHD and LHD Regional vehicles, up to $4,000 
for HHD Regional vehicles. The increased costs above the MY 2021 values 
reflect increased adoption rates of individual technologies, while the 
individual technology costs are generally expected to remain the same 
or decrease, as explained in the RIA Chapter 2.11. The engine costs 
listed represent the average costs associated with the MY 2024 
vocational diesel engine standard described in Section II.D.

                              Table V-29--Final Vocational Vehicle Technology Incremental Costs in the 2024 Model Year a b
                                                                         [2013$]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Light HD                        Medium HD                         Heavy HD
                                                      --------------------------------------------------------------------------------------------------
                                                                    Multi-                           Multi-                           Multi-
                                                         Urban     purpose    Regional    Urban     purpose    Regional    Urban     purpose    Regional
--------------------------------------------------------------------------------------------------------------------------------------------------------
Engine \c\...........................................       $446       $446       $446       $413       $413       $413       $413       $413       $413
Tires................................................          0         31         33         10         10         33         13         13         53
Tire Pressure Monitoring.............................        155        183        211        155        183        211        294        347        401
Transmission.........................................        276        276        276        276        276        276        222      1,032      2,193
Axle related.........................................         24         24         24         24         24         24         37         54         60
Weight Reduction.....................................        186        186        186        186        186        186        684        684        684
Idle reduction.......................................        248        248         21        256        256         21        242        242         21
Hybridization........................................        550        550          0        653        653          0        844        844          0
Air Conditioning \d\.................................         20         20         20         20         20         20         20         20         20
Other \e\............................................         54         54         54         89         89         89        162        162        162
                                                      --------------------------------------------------------------------------------------------------
    Total............................................      1,959      2,018      1,272      2,082      2,110      1,274      2,932      3,813      4,009
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ Costs shown are for the 2024 model year and are incremental to the costs of a vehicle meeting the Phase 1 standards. These costs include indirect
  costs via markups along with learning impacts. For a description of the markups and learning impacts considered in this analysis and how it impacts
  technology costs for other years, refer to Chapter 2 of the RIA (see RIA 2.11).
\b\ Note that values in this table include adoption rates. Therefore, the technology costs shown reflect the average cost expected for each of the
  indicated vehicle classes. To see the actual estimated technology costs exclusive of adoption rates, refer to Chapter 2 of the RIA (see RIA 2.9 in
  particular).
\c\ Engine costs are for a light HD, medium HD or heavy HD diesel engine. We are projecting $136 additional costs beyond Phase 1 for gasoline vocational
  engines.
\d\ EPA's air conditioning standards are presented in Section V.C above.
\e\ Other incremental technology costs include electrified accessories and advanced shift strategy.

    The estimated fleet average vocational vehicle package costs are 
shown in Table V-30 for MY 2027. As shown, these range from 
approximately $1,500 for MHD and LHD Regional vehicles, up to $5,700 
for HHD Regional vehicles. These per-vehicle technology package costs 
were averaged using our projections of vehicle populations in the

[[Page 73718]]

nine regulatory subcategories and do not correspond to the MOVES 
vehicle types. The engine costs shown represent the average costs 
associated with the MY 2027 vocational diesel engine standard described 
in Section II.D.
    Purchase prices of non-custom vocational vehicles can range from 
$60,000 for a light heavy-duty stake-bed landscape truck to over 
$300,000 for a heavy heavy-duty boom truck. The costs of the vocational 
vehicle standards can be put into perspective by comparing estimated 
package costs with typical prices for those vehicles. For example, a 
package cost of $3,000 on a $60,000 landscaping truck represents an 
incremental increase of about five percent of the vehicle purchase 
price. Similarly, a package cost of $4,000 on a $300,000 boom truck 
represents an incremental increase of less than two percent of the 
vehicle purchase price. The vocational vehicle industry 
characterization report in the docket includes additional examples of 
vehicle prices for a variety of vocational applications.\445\
---------------------------------------------------------------------------

    \445\ See Heavy Duty Vocational Vehicle Industry 
Characterization, EPA Contract No. EP-C-12-011. September 2013.

                              Table V-30--Final Vocational Vehicle Technology Incremental Costs in the 2027 Model Year a b
                                                                         [2013$]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Light HD                        Medium HD                         Heavy HD
                                                      --------------------------------------------------------------------------------------------------
                                                                    Multi-                           Multi-                           Multi-
                                                         Urban     purpose    Regional    Urban     purpose    Regional    Urban     purpose    Regional
--------------------------------------------------------------------------------------------------------------------------------------------------------
Engine \c\...........................................       $481       $481       $481       $446       $446       $446       $446       $446       $446
Tires................................................         12         24         24          6         24         24         12         36         36
Tire Pressure Monitoring.............................        187        214        240        187        214        240        355        405        456
Transmission.........................................        271        271        293        271        271        293        220        990      3,269
Axle related.........................................         35         35         35         35         35         35         52         82         87
Weight Reduction.....................................        294        294        294        294        294        294      1,102      1,102      1,102
Idle reduction.......................................        303        303         23        314        314         23        365        365         23
Hybridization........................................        857        857          0      1,032      1,032          0      1,353      1,353          0
Air Conditioning \d\.................................         20         20         20         20         20         20         20         20         20
Other \e\............................................         73         73         77        122        122        127        227        227        231
                                                      --------------------------------------------------------------------------------------------------
    Total............................................      2,533      2,571      1,486      2,727      2,771      1,500      4,151      5,025      5,670
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ Costs shown are for the 2027 model year and are incremental to the costs of a vehicle meeting the Phase 1 standards. These costs include indirect
  costs via markups along with learning impacts. For a description of the markups and learning impacts considered in this analysis and how it impacts
  technology costs for other years, refer to Chapter 2 of the RIA (see RIA 2.11).
\b\ Note that values in this table include adoption rates. Therefore, the technology costs shown reflect the average cost expected for each of the
  indicated vehicle classes. To see the actual estimated technology costs exclusive of adoption rates, refer to Chapter 2 of the RIA (see RIA 2.9 in
  particular).
\c\ Engine costs are shown for a light HD, medium HD or heavy HD diesel engine. For gasoline-powered vocational vehicles we are projecting $125 of
  additional engine-based costs beyond Phase 1.
\d\ EPA's air conditioning standards are presented in Section V.C above.
\e\ Other incremental technology costs include electrified accessories and advanced shift strategy.

(f) Custom Chassis Cost Estimates
    The agencies have performed the above-described cost analysis using 
the assumption that all custom chassis vocational vehicles are 
certified to the primary standards, with full technology packages and 
use of the regular Phase 2 GEM. In terms of costs, we expect that a 
manufacturer will choose to certify a vehicle family to the optional 
custom chassis standards only if it is less costly to do so. The cost-
benefit analysis found in the RIA Chapter 7 presents some estimates of 
what the technology package costs of the primary standards are in terms 
of MOVES vehicle types. For the MOVES types where a custom chassis 
option is available, these are conservatively high cost estimates. 
Table 6 and Table 7 of the RIA Executive Summary present estimates of 
average custom chassis technology packages associated with the final 
optional standards in MY 2021 and MY 2027, respectively.
    The agencies are not aware of any custom chassis manufacturer that 
produces engines. Thus, the engine costs will be borne by engine 
manufacturers. While some of the added engine costs may be passed on to 
vehicle manufacturers, and some vehicle costs may be passed on to 
owners/operators, the overall technology costs of the custom chassis 
standards are significantly less than the Phase 2 vocational vehicle 
technology costs, which, as shown directly below, are highly cost-
effective.
(3) Consistency of the Vocational Vehicle Standards With the Agencies' 
Legal Authority
    NHTSA and EPA project these standards to be achievable within known 
design cycles, and we believe these standards, although technology-
advancing, will allow many different paths to compliance in addition to 
the technology paths on which standard stringency is predicated. These 
standards are predicated on manufacturers implementing technologies 
that we expect will be available in the time frame of these final 
rules. We are projecting that most vehicles can adopt certain of the 
technologies. For example, we project a 70 to 90 percent application 
rate for TPMS. However, for other technologies, such as electrified 
accessories, we are projecting an adoption rate of 15 percent. These 
standards offer manufacturers the flexibility to apply the technologies 
that make sense for their business and for customer needs.
    As discussed above, average per-vehicle costs associated with the 
2027 MY standards are projected to be generally less than five percent 
of the overall price of a new vehicle. The annual cost-effectiveness of 
these vocational vehicle standards in dollars

[[Page 73719]]

per metric ton is presented in the RIA Chapter 7 in Table 7-47. As 
shown in that table, without fuel savings the cost per metric ton of 
the final vocational vehicle standards in calendar year 2021 is $710, 
decreasing to $100 by 2030. The cost effectiveness estimated for heavy-
duty pickup trucks and vans in this rulemaking is presented in Table 7-
46 in that same chapter of the RIA. Those Phase 2 standards have an 
estimated annual cost per metric ton without fuel savings of $2,800 in 
2020, decreasing to $110 (about the same as for vocational) by calendar 
year 2030. The annual cost per ton of the MY 2017-2025 light-duty 
greenhouse gas standards for pickup trucks as reported in 2010 dollars 
without fuel savings is $430 in calendar year 2020, decreasing to $142 
in 2030.\446\ The agencies have found these standards to be highly cost 
effective. In addition, the vocational vehicle standards are clearly 
effective from a net benefits perspective (see RIA Chapter 11.2). 
Therefore, the agencies regard the cost of the final standards as 
reasonable, even without considering that the costs are recovered due 
decreased fuel consumption.
---------------------------------------------------------------------------

    \446\ See Chapter 5.3 of the final RIA for the MY 2017-2025 
Light-Duty GHG Rule, available at http://www3.epa.gov/otaq/climate/documents/420r12016.pdf.
---------------------------------------------------------------------------

    The agencies note that while the projected costs are significantly 
greater than the costs projected for Phase 1, we still consider these 
costs to be reasonable, especially given that the first vehicle owner 
may see the technologies pay for themselves in many cases. As discussed 
above, the usual period of ownership for a vocational vehicle reflects 
a lengthy trade cycle that may often exceed seven years. For most 
vehicle types evaluated, the cost of these technologies, if passed on 
fully to customers, will likely be recovered within four years or less 
due to the associated fuel savings, as shown in the payback analysis 
included in Section IX.M and in the RIA Chapter 7.1. Specifically, in 
RIA Chapter 7.2.4, a summary is presented with estimated payback 
periods for each of the MOVES vocational vehicle types, using the 
annual vehicle miles traveled from the MOVES model for each vehicle 
type. As noted above, the cost analysis presented for this rulemaking 
assumes that all vocational vehicles are certified to the primary 
standard. Using this assumption, the vocational vehicle type with the 
shortest payback is intercity buses (less than one year), while most 
other vehicles (with the exception of school buses and motor homes) are 
projected to see paybacks in the fourth year or sooner. We expect that 
manufacturers will certify to the optional custom chassis standards 
where it is more cost-effective to do so; therefore, our analysis may 
be overly conservative where it indicates very long paybacks for some 
vocational vehicles.
    The agencies note further that although the rules are technology-
advancing (especially with respect to driveline improvements) and the 
estimated costs for each subcategory vary considerably (by a factor of 
five in some cases), these costs represent only one of many possible 
pathways to compliance for manufacturers. Manufacturers retain leeway 
to develop alternative compliance paths, increasing the likelihood of 
the standards' successful implementation. Based on available 
information, the agencies believe the final vocational vehicle 
standards are technically feasible within the lead time provided, are 
cost effective while accounting for the fuel savings (see RIA Chapter 
7.1.4), and have no apparent adverse collateral potential impacts 
(e.g., there are no projected negative impacts on safety or vehicle 
utility).
    The final standards thus appear to represent a reasonable choice 
under section 202(a) of the CAA and are maximum feasible under NHTSA's 
EISA authority at 49 U.S.C. 32902(k)(2). The agencies believe that the 
final standards are consistent with their respective authorities.
(4) Alternative Vocational Vehicle Standards Considered
    The agencies developed and considered other alternative levels of 
stringency for the Phase 2 program. The results of the analysis of 
these alternatives, and comments received on alternatives, are 
discussed below in Section X of the Preamble and the RIA Chapter 11. 
For vocational vehicles, the agencies developed alternatives as shown 
in Table V-31. The agencies are not adopting standards reflecting 
Alternative 2, because as already described, technically feasible 
standards are available that provide for greater emission reductions 
and reduced fuel consumption than provided under Alternative 2. The 
agencies are not adopting standards reflecting Alternative 4 or 
Alternative 5 because we do not believe these standards to be feasible 
considering lead time and other relevant factors. Nevertheless, we have 
reevaluated each of the technology projections proposed for Alternative 
4 and have determined that some engine and tire reductions will be 
feasible on the Alternative 4 timeline.

 Table V-31--Summary of Alternatives Considered for the Final Rulemaking
------------------------------------------------------------------------
            Alternative 1 and 1b                No action alternatives
------------------------------------------------------------------------
Alternative 2..............................  Less stringent than the
                                              preferred alternative in
                                              the proposal, applying off-
                                              the-shelf technologies.
Final HD Phase 2 program...................  Fully phased-in by MY 2027.
Alternative 4..............................  Same stringency as
                                              preferred alternative in
                                              the proposal, phasing in
                                              by MY 2024.
Alternative 5..............................  More stringent alternative,
                                              based on higher adoption
                                              rates of advanced
                                              technologies.
------------------------------------------------------------------------

D. Compliance Provisions for Vocational Vehicles

    We are adopting many changes in the compliance provisions for 
vocational vehicles compared with what we proposed, as described in 
this section.
(1) Application and Certification Process
    The agencies are adopting changes in the final Phase 2 version of 
GEM, as described in Section II of this Preamble. Below we provide 
cross-references to test procedures either that are either required or 
optional, for generation of Phase 2 GEM input values. See Section 
II.D.1 for details of engine testing and GEM inputs for engines.
    As described above in Section I, the agencies will continue the 
Phase 1 compliance process in terms of the manufacturer requirements 
prior to the effective model year, during the model year, and after the 
model year. The information that will be required to be submitted by 
manufacturers is set forth

[[Page 73720]]

in 40 CFR 1037.205, 49 CFR 537.6, and 49 CFR 537.7. EPA will continue 
to issue certificates upon approval based on information submitted 
through the VERIFY database (see 40 CFR 1037.255). End of year reports 
will continue to include the GEM results for all of the configurations 
built, along with credit/deficit balances, if applicable (see 40 CFR 
1037.250 and 1037.730).
(a) GEM Inputs
    In Phase 1, there were two inputs to GEM for vocational vehicles:

 Steer tire coefficient of rolling resistance, and
 Drive tire coefficient of rolling resistance

    As discussed above in Section II and III.D, there are several 
additional inputs that we are adopting for Phase 2. In addition to the 
steer and drive tire CRR, the inputs include the following:
     Engine input file with fuel map, full-load torque curve, 
and motoring curve,
     Transmission input file including architecture type, gear 
number and ratios, and minimum lockup gear for transmissions with 
torque converters,
     Drive axle ratio,
     Axle configuration,
     Tire size in revs/mi for drive and steer tires,
     Idle Reduction,
     Weight Reduction,
     Vehicle Speed Limiter,
     Aerodynamic Drag Area, and
     Pre-defined technology inputs for Accessory Load and Tire 
Pressure Systems
(i) Driveline Inputs
    As with tractors, for each engine family, engine fuel maps, full 
load torque curve, and motoring curve will be generated by engine 
manufacturers and supplied to chassis manufacturers in a format 
compatible with GEM. The test procedures for the torque and motoring 
curves are found in 40 CFR part 1065. Section II.D.1.b describes these 
procedures as well as the procedures for generating the engine fuel 
maps. We require the steady state map approach for the 55 and 65 mph 
cruise speed cycles, while the cycle average approach is required for 
the ARB transient cycle. As an option, the cycle average map may also 
be used for 55 and 65 mph cruise speed cycles. Also similar to 
tractors, transmission specifications will be input to GEM. Any number 
of gears may be entered with a numerical ratio for each, and 
transmission type must be entered as either a Manual, Automated Manual, 
or Automatic transmission.
    As part of the driveline information needed to run GEM, drive axle 
ratio will be a user input. If a configuration has a two-speed axle, 
the agencies are adopting regulations to instruct a manufacturer to 
enter the ratio that is expected to be engaged for the greatest driving 
distance. We requested comment on whether the agencies should allow 
this choice, and what the GEM input instructions should be. Both Dana 
and Meritor commented that there should be an option to recognize two-
speed axles, but neither axle supplier offered a preference for how the 
agencies should implement this. Two-speed axles are typically specified 
for heavy-haul vehicles, where the higher numerical ratio axle is 
engaged during transient driving conditions and to deliver performance 
needed on work sites, while the lower numerical ratio axle may be 
engaged during light-load highway driving.
    Tire size is a Phase 2 input to GEM that is necessary for the model 
to simulate the performance of the vehicle. As a result of comment and 
further technical analysis, we are adopting the tire size input as 
measured in revs/mile, rather than the measure of loaded radius in 
meters, as was proposed. The RIA Chapter 3 includes a description of 
how to measure tire size. For each model and nominal size of a tire, 
there are numerous possible sizes that could be measured, depending on 
whether the tire is new or ``grown,'' meaning whether it has been 
broken in for at least 200 miles. Size can also vary based on load and 
inflation levels, air temperature, and tread depth. The agencies 
requested comment on aspects of measuring and reporting tire size. The 
revised test procedure is described in the RIA Chapter 3.3.4.
    For manufacturers electing to certify a vocational vehicle to the 
optional custom chassis standards, none of the above driveline inputs 
are applicable. In this case manufacturers must input one of the custom 
chassis regulatory subcategory identifiers shown in Table V-32. After 
the remaining input fields are either completed with values or N/A, GEM 
will simulate the vehicle by calling the default engine and 
transmission files, tire size, and axle radius from the GEM library. 
The following subsections describe the required and optional inputs for 
custom chassis.

              Table V-32--Custom Chassis Subcategory Names
------------------------------------------------------------------------
                                   Regulatory
        Vehicle type             subcategory GEM    Default weight class
                                   identifier          and duty cycle
------------------------------------------------------------------------
Motor Home..................  MHD_CC_MH...........  MHD Regional.
School Bus..................  MHD_CC_SB...........  MHD Urban.
Coach Bus...................  HHD_CC_CB...........  HHD Regional.
Emergency Vehicle...........  HHD_CC_EM...........  HHD Urban.
Concrete Mixer..............  HHD_CC_CM...........  HHD Urban.
Transit and Other bus.......  HHD_CC_OB...........  HHD Urban.
Refuse Truck................  HHD_CC_RF...........  HHD Urban.
------------------------------------------------------------------------

    The agencies requested comments on the merits of using an equation-
based compliance approach for emergency vehicle manufacturers, similar 
to the approach for trailer manufacturers described in Section IV.F. 
CARB commented in support of an equation-based compliance approach, but 
in the same comment they also expressed support for using a Phase 1-
style GEM interface with a default engine simulated in GEM as 
appropriate for the emergency vehicle category. We received adverse 
comment on the equation-based approach from Daimler, because they 
believed it would make the compliance process more complex if some 
vehicles needed to be tracked differently. Our intent in soliciting 
comment on an equation-based approach was to assess whether running GEM 
was a burden for non-diversified manufacturers of low-technology 
vehicles. Because we received sufficient support from non-diversified 
manufacturers that a simplified GEM would meet their needs, we did not 
pursue an equation-based approach.
    The final certification approach is consistent with the approach 
recommended by the Small Business Advocacy Review Panel, which believed 
it will be feasible for small emergency

[[Page 73721]]

vehicle manufacturers to install a Phase 2-compliant engine, but 
recommended a simplified certification approach to reduce the number of 
required GEM inputs.
(ii) Idle Reduction Inputs
    The agencies proposed two different idle reduction inputs for 
vocational vehicles: Neutral idle and stop-start. Based on comment, we 
are adding a third type of idle reduction input: Automatic engine 
shutdown. Based on user inputs derived from engine testing described in 
Section II and RIA Chapter 3.1, GEM will calculate CO2 
emissions and fuel consumption at both zero torque (neutral idle) and 
with torque set to Curb-Idle Transmission Torque for automatic 
transmissions in ``drive'' (as described in the RIA Chapter 3.4.2.3) 
for use in the CO2 emission calculation in 40 CFR 
1037.510(b). At proposal, neutral idle and stop-start were not 
recognized during the ARB transient cycle, they were recognized only 
during the separate idle cycle. The agencies received comments 
requesting recognition of neutral idle during the ARB transient test 
cycle. We agree this is desirable and have adopted changes in GEM to 
accomplish this. Also, with the adoption of the alternative engine 
mapping procedure for the ARB transient cycle, the computation for idle 
reduction has changed. Please see RIA Chapter 4.4.1.7 for a description 
of how GEM recognizes idle reduction.
    For vocational custom chassis certified to the optional standards, 
all three idle reduction inputs will be available, however, the 
computation will be based on the EPA default engine. As described in 
the GEM User Guide, users will enter Y or N, and GEM will return a 
predefined improvement.
(iii) Weight Reduction Inputs
    In Phase 1, the agencies adopted tractor regulations that provided 
manufacturers with the ability to utilize high strength steel and 
aluminum components for weight reduction without the burden of entering 
the curb weight of every tractor produced. In Phase 2, the agencies are 
adopting a lookup table of lightweight components for use in certifying 
vocational vehicles, similar to the process for tractors. As noted 
above, the agencies will recognize weight reduction by allocating one 
half of the weight reduction to payload in the denominator, while one 
half of the weight reduction will be subtracted from the overall weight 
of the vehicle in GEM.
    The agencies are adopting lookup values for components on 
vocational vehicles in all HD weight classes. Components available for 
vocational vehicle manufacturers to select for weight reduction are 
shown below in Table V-33, below. All of these weight reduction inputs 
will be available for manufacturers of custom chassis certifying to the 
optional standards. We received comments from Allison Transmission 
noting that aluminum transmission cases and clutch housings are 
standard for automatic transmissions so we agree it is inappropriate to 
include these components in the lookup table. We have revised the 
values in response to adverse comments from AISI, and after 
reevaluating information available at proposal. Although we are not 
projecting any adoption of permanent 6x2 axles for non-custom 
vocational vehicles, if a manufacturer chooses to apply this technology 
for class 8 vocational vehicles, users may enter an appropriate weight 
reduction compared to the traditional 6x4 axle configuration.\447\ We 
received adverse comments on the proposal to assign a fixed weight 
increase to natural gas fueled vehicles to reflect the weight increase 
of natural gas fuel tanks versus gasoline or diesel tanks. Based on 
comments and further technical analysis, we have determined that to 
provide equitable treatment to technologies, we will not require a 
weight penalty for any technology applied to achieve certification in 
Phase 2. We accounted for adoption of weight-increasing technologies in 
our MOVES modeling.
---------------------------------------------------------------------------

    \447\ See NACFE Confidence Findings on the Potential of 6x2 
Axles.

                    Table V-33--Phase 2 Weight Reduction Technologies for Vocational Vehicles
----------------------------------------------------------------------------------------------------------------
                                                                             Vocational vehicle class
               Component                        Material         -----------------------------------------------
                                                                    Class 2b-5       Class 6-7        Class 8
----------------------------------------------------------------------------------------------------------------
Axle Hubs--Non-Drive..................  Aluminum................                40                            40
Axle Hubs--Non-Drive..................  High Strength Steel.....                 5                             5
Axle--Non-Drive.......................  Aluminum................                60                            60
Axle--Non-Drive.......................  High Strength Steel.....                15                            15
Brake Drums--Non-Drive................  Aluminum................                60                            60
Brake Drums--Non-Drive................  High Strength Steel.....                42                            42
Axle Hubs--Drive......................  Aluminum................                40                            80
Axle Hubs--Drive......................  High Strength Steel.....                10                            20
Brake Drums--Drive....................  Aluminum................                70                           140
Brake Drums--Drive....................  High Strength Steel.....                37                            74
Suspension Brackets, Hangers..........  Aluminum................                67                           100
Suspension Brackets, Hangers..........  High Strength Steel.....                20                            30
                                       -------------------------------------------------------------------------
Crossmember--Cab......................  Aluminum................              10              15              15
Crossmember--Cab......................  High Strength Steel.....               2               5               5
Crossmember--Non-Suspension...........  Aluminum................              15              15              15
Crossmember--Non-Suspension...........  High Strength Steel.....               5               5               5
Crossmember--Suspension...............  Aluminum................              15              25              25
Crossmember--Suspension...............  High Strength Steel.....               6               6               6
Driveshaft............................  Aluminum................              12              40              50
Driveshaft............................  High Strength Steel.....               5              10              12
Frame Rails...........................  Aluminum................             120             300             440
Frame Rails...........................  High Strength Steel.....              40              40              87
Wheels--Dual..........................  Aluminum................             150             150             250
Wheels--Dual..........................  High Strength Steel.....              48              48              80
Wheels--Wide Base Single..............  Aluminum................             294             294             588

[[Page 73722]]

 
Wheels--Wide Base Single..............  High Strength Steel.....             168             168             336
Permanent 6x2 Axle Configuration......  Multi...................             N/A             N/A             300
----------------------------------------------------------------------------------------------------------------

(iv) Other Inputs
    Certifying manufacturers may enter values in GEM as applicable for 
vehicle speed limiters, fairings to reduce aerodynamic drag area, 
electrified accessories, and tire pressure systems where such features 
meet the criteria in the regulations at 40 CFR 1037.520.
(b) Test Procedures
    Powertrain families are defined in Section II.C.3.b, and powertrain 
test procedures are discussed in the RIA Chapter 3.6. The results from 
testing a powertrain configuration using the matrix of tests described 
in RIA Chapter 3.6 can be applied broadly across all vocational 
vehicles in which that powertrain will be installed. Powertrain test 
results become a GEM input file that replaces both the engine input 
file and transmission input file.
    As in Phase 1, the rolling resistance of each tire will be measured 
using the ISO 28850 test method for drive tires and steer tires planned 
for fitment to the vehicle being certified. Once the test CRR values 
are obtained, a manufacturer will declare TRRLs (which may be equal to 
or higher than the measured values) for the drive and steer tires 
separately to be input into the GEM. For Phase 2 vocational vehicles, 
GEM will distribute the vehicle load with 30 percent of the load over 
the steer tires and 70 percent of the load over the drive tires. With 
these data entered, the amount of GHG reduction attributed to tire 
rolling resistance will be incorporated into the overall vehicle 
compliance value.
    The final Phase 2 GEM will accept as inputs results from a 
transmission efficiency test. A procedure for this was discussed in the 
NPRM, and received favorable comment. The transmission efficiency test 
will be optional, but will allow manufacturers to reduce the 
CO2 emissions and fuel consumption by designing better 
transmissions with lower friction due to better gear design and/or 
mandatory use of better lubricants.
    In lieu of a fixed value for low friction axle lubricants as was 
proposed, the agencies are adopting an axle efficiency test procedure, 
as was discussed in the NPRM. See 80 FR 40323. The axle efficiency test 
will be optional, but will allow manufacturers to reduce CO2 
emissions and fuel consumption through improved axle gear designs and/
or mandatory use of low friction lubricants. The agencies are not 
finalizing any other paths to recognize low friction axle lubricants.
(c) Useful Life and In-Use Standards
    Section 202(a)(1) of the CAA specifies that emission standards are 
to be applicable for the useful life of the vehicle. The standards that 
EPA and NHTSA are adopting will apply to individual vehicles and 
engines at production and in use. NHTSA is not adopting in-use 
standards for vehicles or engines.
    Manufacturers may be required to submit, as part of the application 
for certification, an engineering analysis showing that emission 
control performance will not deteriorate during the useful life, with 
proper maintenance. If maintenance will be required to prevent or 
minimize deterioration, a demonstration may be required that this 
maintenance will be performed in use. See 40 CFR 1037.241.
    EPA will continue the Phase 1 approach to adjustment factors and 
deterioration factors for vehicles. The technologies on which the Phase 
1 vocational vehicle standards were predicated were not expected to 
have any deterioration of GHG effectiveness in use. However, the 
regulations provided a process for manufacturers to develop 
deterioration factors (DF) if they needed. We anticipate that some 
hybrid powertrain systems may experience some deterioration of 
effectiveness with age of the energy storage device. We believe the 
regulations in place currently provide adequate instructions to 
manufacturers for developing DF where needed. We received comments from 
Daimler on deterioration factors for engines and the process for 
extrapolating where DF's are nonlinear. See Section 3.7 of the RTC. 
Allison Transmission commented that the amount of credits generated for 
a hybrid system should be dependent, in part, on design limits of 
batteries. We do not believe any changes are needed because the 
regulations do account for this by basing the FELs on the highest 
emissions during the useful life, including any effects from 
deterioration.
    As with engine certification, a chassis manufacturer must design 
their vehicles to be durable enough to maintain compliance through the 
regulatory useful life of the vehicle. Factors influencing vehicle-
level GHG performance over the life of the vehicle fall into two basic 
categories: Vehicle attributes and maintenance items. Each category 
merits different treatment from the perspective of assessing useful 
life compliance, as each has varying degrees of manufacturer versus 
owner/operator responsibility. The agencies require manufacturers to 
explain how they meet these requirements as part of certification.
    For vocational vehicles, attributes generally refers to components 
that are installed by the manufacturer to meet the standard, whose 
reduction properties are assessed at the time of certification, and 
which are expected to last the full life of the vehicle with 
effectiveness maintained as new for the life of the vehicle with no 
special maintenance requirements. To assess useful life compliance, we 
will follow a design-based approach that will ensure that the 
manufacturer has robustly designed these features so they can 
reasonably be expected to last the useful life of the vehicle.
    For vocational vehicles, maintenance items generally refers to 
items that are replaced, renewed, cleaned, inspected, or otherwise 
addressed in the preventative maintenance schedule specified by the 
vehicle manufacturer. Replacement items that have a direct influence on 
GHG emissions are primarily tires and lubricants, but may also include 
hybrid system batteries. Synthetic engine oil may be used by vehicle 
manufacturers to reduce the GHG emissions of their vehicles. 
Manufacturers may specify that these fluids be changed throughout the 
useful life of the vehicle. If this is the case, the manufacturer 
should have a reasonable basis that the owner/operator will use fluids 
having the same properties. This may be accomplished by requiring (in 
service documentation, labeling, etc.) that only these fluids can be 
used as replacements. We received comments from EMA asking us to 
consider maintenance costs for hybrids. In these final rules, we have 
quantified

[[Page 73723]]

maintenance costs for tire replacement, stop-start, axle lubrication, 
and hybrids, as described in Section IX.D and the RIA Chapter 7.1.
    Aside from those technologies identified above, if the vehicle 
remains in its original certified condition throughout its useful life, 
it is not believed that GHG emissions will increase as a result of 
service accumulation. As in Phase 1, the agencies will therefore allow 
the use of an assigned deterioration factor of zero where appropriate 
in Phase 2; however this does not negate the responsibility of the 
manufacturer to ensure compliance with the emission standards 
throughout the useful life.\448\ Under both Phase 1 and the new Phase 
program, manufacturers must apply good engineering judgment when 
considering deterioration and may not ignore any evidence that the 
emissions performance will decline during actual use. The agencies may 
require vehicle manufacturers to provide engineering analyses at the 
time of certification demonstrating that vehicle attributes will last 
for the full useful life of the vehicle. We anticipate this 
demonstration would often need only show that components are 
constructed of sufficiently robust materials and design practices so as 
not to become dysfunctional under normal operating conditions.
---------------------------------------------------------------------------

    \448\ For most technologies, manufacturers may presume zero 
deterioration unless good engineering judgment does not support such 
a presumption. For example, it would not be appropriate to presume 
no deterioration in hybrid battery performance.
---------------------------------------------------------------------------

    In Phase 1, EPA set the useful life for engines and vehicles with 
respect to GHG emissions equal to the respective useful life periods 
for criteria pollutants. In April 2014, as part of the Tier 3 light-
duty vehicle final rule, EPA extended the regulatory useful life period 
for criteria pollutants to 150,000 miles or 15 years, whichever comes 
first, for Class 2b and 3 pickup trucks and vans and some light-duty 
trucks (79 FR 23414, April 28, 2014). Class 2 through Class 5 heavy-
duty vehicles subject to the GHG standards described in this section 
for vocational applications generally use the same kinds of engines, 
transmissions, and emission controls as the Class 2b and 3 vehicles 
that are chassis-certified to the criteria standards under 40 CFR part 
86, subpart S. In Phase 2, EPA and NHTSA are adopting a useful life of 
150,000 miles or 15 years for vocational vehicles at or below 19,500 
lbs GVWR. In many cases, this will result in aligned useful-life values 
for criteria and GHG standards. Where this longer useful life is not 
aligned with the useful life that applies for criteria standards 
(generally in the case of engine-based certification under 40 CFR part 
86, subpart A), EPA may revisit the useful-life values for both 
criteria and GHG standards in a future rulemaking. For medium heavy-
duty vehicles (19,500 to 33,000 lbs GVWR) and heavy heavy-duty vehicles 
(above 33,000 lbs GVWR) EPA will keep the useful-life values from Phase 
1, which are 185,000 miles (or 10 years) and 435,000 miles (or 10 
years), respectively. EPA received comments in support of this 
approach, including support for the numerical values and the overall 
process envisioned for achieving the long-term goal of adopting 
harmonized useful-life specifications for criteria pollutant and GHG 
standards that properly represent the manufacturers' obligation to meet 
emission standards over the expected service life of the vehicles.
    We received comment on what policies we should adopt to address the 
situation where the engine and the vehicle are subject to emission 
standards over different useful-life periods. For example, a medium 
heavy-duty engine may power vehicles in weight classes ranging from 2b 
to 8, with correspondingly different regulatory useful lives for those 
vehicles. Please see Section I.F.2.f for a discussion of revisions made 
to the final regulations to address this situation. The Response to 
Comments also addresses this issue at Chapter 1.4.
(d) Definitions of Custom Chassis
    Eligible emergency vehicles for Phase 2 purposes are ambulances and 
fire trucks. The agencies requested comment on aligning the definition 
of emergency vehicle for purposes of the Phase 2 program with the 
definition of emergency vehicle for purposes of the light-duty GHG 
provisions under 40 CFR 86.1818, which includes additional vehicles 
such as those used by law enforcement.\449\ Daimler commented in 
support of aligning these definitions of emergency vehicle. Daimler 
further requested the agencies consider adopting the same definition as 
in 13 CCR 1956.8(a)(6), the California regulations. We are adopting the 
narrow definition as was proposed, with agency discretion to apply 
these provisions to similar vehicles.
---------------------------------------------------------------------------

    \449\ See 40 CFR 86.1803-01 for the applicable definition of 
emergency vehicle.
---------------------------------------------------------------------------

    RVIA commented in favor of adopting a motor home definition 
consistent with NHTSA's definition at 49 CFR 571.3: Motor home means a 
multipurpose passenger vehicle with motive power that is designed to 
provide temporary residential accommodations, as evidenced by the 
presence of at least four of the following facilities: Cooking; 
refrigeration or ice box; self-contained toilet; heating and/or air 
conditioning; a potable water supply system including a faucet and a 
sink; and a separate 110-125 volt electrical power supply and/or 
propane. The agencies are adopting a definition of motor home that is 
generally consistent with this, without specifying detailed features.
    Since 2003, NHTSA has implemented a broad definition of school bus 
that includes multifunction school activity buses that don't have stop 
arms or flashing lights, need not be painted yellow, and do not have an 
upper weight limit. These are a category of school bus that must meet 
the school bus structural standards or the equivalent set forth in 49 
Code of Federal Regulations Part 571, and the emergency exit 
requirements specified in FMVSS No. 217 for school buses, as well as 
FMVSS 222 for passenger seating and crash protection. This definition 
was created in part to allow for use of safe buses to transport school 
age children on trips other those than between home and school. The 
agencies are adopting Phase 2 provisions such that buses eligible to 
certify to the custom chassis school bus standards are those that meet 
NHTSA's definition of school bus, including multifunction school 
activity buses.\450\
---------------------------------------------------------------------------

    \450\ See 68 FR 44892--Federal Motor Vehicle Safety Standards; 
Definition of Multifunction School Activity Bus; https://www.govinfo.gov/content/pkg/FR-2003-07-31/pdf/03-19457.pdf.
---------------------------------------------------------------------------

    The most definitive attribute we have identified to distinguish 
over-the-road coach buses from transit buses is whether passengers are 
permitted to stand while the vehicle is driving. Therefore the only 
buses permitted to certify to the final custom chassis coach bus 
standards are those subject to NHTSA's Occupant Crash Protection 
Rule.\451\
---------------------------------------------------------------------------

    \451\ See Occupant Crash Protection rule, November 25, 2013, 78 
FR 70415, 49 CFR 571, FMVSS 208 https://www.gpo.gov/fdsys/pkg/FR-2013-11-25/html/2013-28211.htm, accessed February 2016.
---------------------------------------------------------------------------

    Allied Specialty Vehicles (aka Rev Group) commented on the need for 
a clear distinction between transit buses and school buses.\452\ If the 
pupils transported are not K-12 students, such as may be the case for 
buses serving college campuses, then the chassis may not be easily 
distinguishable from transit buses. The agencies are adopting 
provisions in Phase 2 such that buses not qualifying as eligible to 
certify as coach buses or school buses must meet the custom chassis 
standards for transit

[[Page 73724]]

buses. Buses serving college campuses do not have the same design and 
safety restrictions as those intended to transport primary and 
secondary school children, and may apply the same technologies as 
general-purpose urban buses.
---------------------------------------------------------------------------

    \452\ Phone conversation March 2016, see L. Steele phone log.
---------------------------------------------------------------------------

    Therefore, we are requiring refuse trucks that do not compact waste 
to be certified to the primary vocational vehicle standards. Front-
loading refuse collection vehicles tend to have a relatively low number 
of stops per day as they tend to collect waste from central locations 
such as commercial buildings and apartment complexes. Because these 
have a relatively low amount of PTO operation, we expect stop-start 
will be reasonably effective for these vehicles. Rear-loading and side-
loading neighborhood waste and recycling collection trucks are the 
refuse trucks where the largest number of stop-start and neutral idle 
over-ride conditions are likely to be encountered. Because chassis 
manufacturers, even those with small production volumes and close 
customer relationships, do not always know whether a refuse truck will 
be a front-loader, rear-loader, or side loader, we are grouping these 
together in a subcategory.
    We received comment on the need to clarify whether vehicles 
designed to pump and convey concrete at a job site, but which do not 
carry the wet mix concrete to the job site, would be included in the 
definition of cement mixers. Although we are not defining other 
vehicles as cement mixers, we are allowing miscellaneous vocational 
vehicles meeting some but not all of the eligibility criteria at 40 CFR 
1037.631 to be certified under the custom chassis program, using 
technology equivalent to the cement mixer package, as described above 
in Section V.B.
(e) Assigning Vehicles to Subcategories
    In the NPRM, the agencies proposed criteria by which a vehicle 
manufacturer would know in which vocational subcategory--Regional, 
Urban, or Multipurpose--the vehicle should be certified. These cut-
points were defined using calculations relating engine speed to vehicle 
speed. 80 FR 40287-40288. Specifically, we proposed a cutpoint for the 
Urban duty cycle where a vehicle at 55 mph would have an engine working 
above 90 percent of maximum engine test speed for vocational vehicles 
powered by diesel engines and above 50 percent for vocational vehicles 
powered by gasoline engines. Similarly, we proposed a cutpoint for the 
Regional duty cycle where a vehicle at 65 mph would have an engine 
working below 75 percent of maximum engine test speed for vocational 
vehicles powered by diesel engines and below 45 percent for vocational 
vehicles powered by gasoline engines. We received several comments that 
identified weaknesses in that approach. Specifically, Allison explained 
that vehicles with two shift schedules would need clarification which 
top gear to use when calculating the applicable cut-point. Also, 
Daimler noted that, to the extent that downspeeding occurs in this 
sector over the next decade or more, cutpoints based on today's fleet 
may not be valid for a future fleet. Allison noted that the presence of 
additional top gears could strongly influence the subcategory placement 
of vocational vehicles. These comments highlight the possibility of 
misclassification, and the potential pitfalls in a mandated 
classification scheme.
    Two commenters pointed out important weaknesses in this approach, 
namely that future trends in engine speeds, torque curves, and 
transmission gear ratio spreads may cause the vocational fleet of 2027 
to have drivelines that are sufficiently different than those of the 
baseline fleet, so that segment cut-points based on the 2016 fleet may 
not be valid a decade or more into the future. For example, if data on 
today's fleet indicated an appropriate cut-point for Regional HHD 
diesel vehicles of 1,400 rpm engine speed with a vehicle speed of 65 
mph, while a future fleet might show that Regional vehicles operated at 
1,200 rpm at 65 mph, then having a cut-point set by rule at 1,400 rpm 
could result in an excess of future vehicles certifying as Regional. 
However, we have further assessed the impact of manufacturers shifting 
certification of chassis from Multipurpose to Regional subcategories, 
and we have concluded this is not an unacceptable outcome. As explained 
above in Section V.C.(2)(d), we are not particularly concerned that 
adopting final standards with unequal percent improvements poses a 
danger of losing environmental benefits from this program, as long as 
vehicle configurations are properly classified at the time of 
certification.
    In a regulatory structure where baselines are equal but future 
standards for vehicles in different subcategories have different 
stringencies, the agencies would typically assign subcategorization 
based on regulatory criteria rather than allowing the manufacturers 
unconstrained choice because manufacturers would have a strong 
incentive to simply choose the least stringent standards. However, 
because the baseline performance levels of the different vocational 
vehicle regulatory subcategories widely differ, the agencies have 
determined that it is acceptable to adopt standards with unequal 
percent stringencies. Further discussion of our reasons for this 
determination is presented above in Section V.C.(2)(d). Another 
weakness in the proposed approach was that even though we have obtained 
a great deal of data thanks to manufacturer cooperation and NREL duty 
cycle analysis, the only one of the proposed regulatory cut-points in 
which we have a high degree of confidence is the cut-point between 
Regional and Multipurpose class 8 diesels. Any cut-points we could 
establish based on available data for lower weight class diesels or for 
gasoline powered vocational vehicles would be less robust. These 
weaknesses have led the agencies to take a different approach to 
assigning vehicles to subcategories. The agencies are adopting final 
regulations that generally allow manufacturers to choose a subcategory, 
with a revised set of constraints as well as a provision requiring use 
of good engineering judgment. The constraints discussed here are being 
adopted as interim provisions in response to manufacturers' concerns 
that some of them could present competitive disadvantages, where 
different manufacturers produce very different sales mixes of vehicles 
equipped with different transmission types, as discussed above in 
Section V.C.(2)(d).
    Because the baseline configurations against which vehicles in the 
Urban subcategories will measure their future performance do not 
include any manual transmissions, we have determined that vocational 
vehicles with manual transmissions may not be certified as Urban. In 
the real world, we do not expect any vehicles intended to be used in 
urban driving patterns will be specified with manual transmissions. 
Driver fatigue and other performance problems make this an illogical 
choice of transmission, and thus it is appropriate for us to adopt this 
constraint. As described in Chapter 2.9.2 of the RIA, both the HHD 
Regional and HHD Multipurpose baselines have a blend of manual 
transmissions, although the majority of manuals are in the HHD Regional 
baseline. Further, by MY 2024, our adoption rate of transmission 
technology reflects zero manuals in HHD Multipurpose. Thus, beginning 
in MY 2024, any vocational vehicle certified with a manual transmission 
must be classified in a Regional subcategory, except a vehicle with a 
hybridized manual transmission may be certified in a Multipurpose 
subcategory beyond MY 2024.

[[Page 73725]]

    We are not adopting constraints on vehicles with automated manual 
transmissions certifying in either Regional or Multipurpose 
subcategories, because we believe this is a technology that can provide 
real world benefits for vehicles with those driving patterns. However, 
we are adopting an interim constraint to prevent vehicles with AMT from 
being certified as Urban for a reason similar to one described above 
for manuals, namely that in the real world, we do not expect any 
vehicles intended to be used in urban driving patterns will be 
specified with transmissions that do not have powershifts. Lack of 
smooth shifting characteristics during low speed accelerations and 
decelerations make AMT an illogical choice of transmission for urban 
vehicles, and thus it is appropriate for us to adopt this constraint.
    Dual clutch transmissions have very recently become available for 
medium heavy-duty vocational vehicles and very little data are 
available on their design or performance. We anticipate that in the 
future, some designs may have features that make them perform similarly 
to AMT's while others may have features that make them more similar to 
automatics with torque converters. Because we are not confident that we 
know in which duty cycle(s) they are best suited, we are adopting a 
partial constraint on these, namely that dual clutch transmissions 
without powershifting must also be constrained out of Urban. We are 
finalizing as proposed that any vehicle whose engine is exclusively 
certified over the SET must be certified in the Regional subcategory. 
Further, to the extent manufacturers of intercity coach buses and 
recreational vehicles certify these to the primary standards, these 
also must be certified as Regional vehicles.\453\
---------------------------------------------------------------------------

    \453\ Based on NREL drive cycle analysis of the existing fleet, 
we imagine that HHD vehicles with a diesel engine rpm of 1,400 and 
below when the vehicle is at 65 mph would be appropriately certified 
as Regional vehicles. However, this is illustrative only, and the 
final rules do not include an engine speed cutpoint as a criterion 
in subcategory selection.
---------------------------------------------------------------------------

    In the final regulatory structure, although the standards for 
vehicles in different subcategories have different percent stringencies 
from each baseline, the agencies can allow the manufacturers to choose 
without risking a loss of environmental benefits because a standard 
that may appear less stringent in terms of relative improvement from 
each respective baseline may also be numerically lower (and farther 
away from current model performance) due to a comparatively better-
performing regulatory baseline. As explained above, the final standards 
described above in Section V.C.(2)(c) are derived directly from the 
technology packages without applying any assumptions about fleet 
averages. Thus, unlike at proposal, the final regulations will 
generally allow manufacturers to certify in the particular duty-cycle 
subcategory they believe to be most appropriate. Manufacturers may make 
this choice as part of the certification process and will not be 
allowed to change it after the vehicle has been introduced into 
commerce. Under this structure, the agencies expect manufacturers to 
choose a subcategory for each vehicle configuration that best 
represents the type of operation that vehicle will actually experience 
in use (presuming the manufacturer and customer would specify the 
technologies to reflect such operation).
(2) Other Compliance Provisions
(a) Emission Control Labels
    As proposed, EPA is removing the requirement to include the 
emission control system identifiers required in 40 CFR 1037.135(c)(6) 
and in Appendix III to 40 CFR part 1037 from the emission control 
labels for vehicles certified to the Phase 2 standards. For vehicles 
certified to the optional custom chassis standards, the label should 
meet the requirements of 40 CFR 1037.105(h). Please see Section 
I.C.(1)(g) of this Preamble for additional discussion of labeling.
(b) End of Year Reports
    In the Phase 1 program, manufacturers participating in the ABT 
program provided 90 day and 270 day reports to EPA and NHTSA after the 
end of the model year. The agencies adopted two reports for the initial 
program to help manufacturers become familiar with the reporting 
process. For the HD Phase 2 program, the agencies proposed to simplify 
reporting such that manufacturers would only be required to submit the 
final report 90 days after the end of the model year with the potential 
to obtain approval for a delay up to 30 days. We requested comments on 
this approach. EMA, PACCAR, Navistar, Daimler, and Cummins recommended 
keeping the 270 day report to allow sufficient time after the 
production period is completed. We are accordingly keeping both the 90 
day and 270 day reports, with the ability of the agencies' to waive the 
90 day report.
(c) Delegated Assembly
    The final standards for vocational vehicles are based on the 
application of a wide range of technologies. Certifying vehicle 
manufacturers manage their compliance demonstration to reflect this 
range of technologies by describing their certified configurations in 
the application for certification. In most cases, these technologies 
are designed and assembled (or installed) directly by the certifying 
vehicle manufacturer, which is typically the chassis manufacturer. In 
these cases, it is straightforward to assign the responsibility to the 
certifying vehicle manufacturer for ensuring that vehicles are in their 
proper certified configuration before they are introduced into 
commerce. In Phase 1, the only vehicle technology available for 
certified vocational vehicles is LRR tires. Because these are generally 
installed by the chassis manufacturer, there is no need to rely on a 
second stage manufacturer for purposes of certification in Phase 1, 
unless innovative credits are sought. Thus, the Phase 1 regulations did 
not specify precise procedures for this.
    In Phase 2, the agencies are projecting adoption of certain 
technologies where the certifying vehicle manufacturer may want or need 
to rely on a downstream manufacturing company (a secondary vehicle 
manufacturer) to take steps to assemble or install certain components 
or technologies to bring the vehicle into a certified configuration. A 
similar relationship between manufacturers applies with aftertreatment 
devices for certified engines. EPA previously adopted ``delegated 
assembly'' provisions for engines at 40 CFR 1068.261 to describe how 
manufacturers can share compliance responsibilities through these 
cooperative assembly procedures, and proposed to also apply it for 
vehicle-based GHG standards in 40 CFR part 1037, including the 
vocational vehicle standards.
    The delegated assembly provisions being finalized for Phase 2 
vehicle standards are only invoked if a certifying manufacturer 
includes in its certified configuration a technology that it does not 
install itself. Examples may include fairings to reduce aerodynamic 
drag, air conditioning systems, automatic tire inflation systems, or 
hybrid systems. We are clarifying this regulatory process to enable 
manufacturers to include technologies in their compliance plans that 
might otherwise not be considered on the basis of what they can install 
themselves. To the extent certifying manufacturers rely on secondary 
vehicle manufacturers to bring the vehicle into a certified 
configuration, the following provisions will apply:

[[Page 73726]]

     The certifying manufacturer will describe its approach to 
delegated assembly in the application for certification.
     The certifying manufacturer will create installation 
instructions to describe how the secondary vehicle manufacturer will 
bring the vehicle into a certified configuration.
     The certifying manufacturer must take additional steps for 
certified configurations that include hybrid powertrain components, 
auxiliary power units, aerodynamic devices, or natural gas fuel tanks. 
In these cases, the certifying manufacturer must have a contractual 
agreement with each affected secondary vehicle manufacturer obligating 
the secondary vehicle manufacturer to build each vehicle into a 
certified configuration and to provide affidavits confirming proper 
assembly procedures, and to provide information regarding deployment of 
each type of technology (if there are technology options that relate to 
different GEM input values).
    See Section I.F of this Preamble and Section 1.4.4 of the RTC for 
further discussion of the comments received on delegated assembly 
provisions.
    The agencies have developed the delegated-assembly and other 
provisions in 40 CFR 1037.620--1037.622 to clarify how manufacturers 
have shared and separate responsibilities for complying with the 
regulations. Vocational vehicles are the most likely vehicle types to 
involve both primary and secondary manufacturers; however, other types 
of vehicles may also involve multiple manufacturers, so these 
regulatory provisions apply to all vehicles.
    Secondary manufacturers (such as body builders) that build complete 
vehicles from certified chassis are obligated to comply with the 
emission-related installation instructions provided by the certifying 
manufacturer. Secondary manufacturers that build complete vehicles from 
exempted chassis are similarly obligated to comply with all of the 
regulatory provisions related to the exemption.
(d) Demonstrating Compliance With HFC Leakage Standards
    EPA's requirements for vocational chassis manufacturers to 
demonstrate reductions in direct emissions of HFC in their A/C systems 
and components through a design-based method. The method for 
calculating A/C leakage is the same as was adopted in Phase 1 for 
tractors and HD pickups and vans. It is based closely on an industry-
consensus leakage scoring method, described below. This leakage scoring 
method is correlated to experimentally-measured leakage rates from a 
number of vehicles using the different available A/C components. As is 
done currently for other HD vehicles, vocational chassis manufacturers 
will choose from a menu of A/C equipment and components used in their 
vehicles in order to establish leakage scores, to characterize their A/
C system leakage performance. The percent leakage per year will then be 
calculated as this score divided by the system refrigerant capacity. We 
received comments from transit bus manufacturers with concerns that the 
air conditioning systems on their vehicles are much larger and more 
complex than systems on typical heavy-duty trucks. As such, they 
questioned whether our HFC leakage compliance process was valid for 
their vehicles. Based on information provided by suppliers of air 
conditioning systems for large buses, we believe some unusually large 
systems may include components not adequately represented by those 
listed in the standard compliance procedure, namely the hoses, fittings 
or seals may not be listed with realistic leakage rates. Therefore EPA 
is adopting in this final rule provisions allowing use of an alternate 
compliance procedure where an air conditioning system with refrigerant 
charge capacity greater than 3,000 grams is installed in a Phase 2 
vocational vehicle.
    Consistent with the light-duty rule and the Phase 1 program for 
other HD vehicles, vocational chassis manufacturers will compare the 
components of a vehicle's A/C system with a set of leakage-reduction 
technologies and actions that is based closely on that developed 
through the Improved Mobile Air Conditioning program and SAE 
International (as SAE Surface Vehicle Standard J2727, ``HFC-134a, 
Mobile Air Conditioning System Refrigerant Emission Chart,'' August 
2008 version). See generally 75 FR 25426. The SAE J2727 approach was 
developed from laboratory testing of a variety of A/C related 
components, and EPA believes that the J2727 leakage scoring system 
generally represents a reasonable correlation with average real-world 
leakage in new vehicles. This approach associates each component with a 
specific leakage rate in grams per year that is identical to the values 
in J2727 and then sums together the component leakage values to develop 
the total A/C system leakage. Unlike the light-duty program, in the 
heavy-duty vehicle program, the total A/C leakage score is divided by 
the value of the total refrigerant system capacity to develop a percent 
leakage per year.
    EPA concludes that the design-based approach results in estimates 
of likely leakage emissions reductions that are comparable to those 
that would result from performance-based testing. Where a manufacturer 
installs an air conditioning system in a vocational vehicle that has a 
working fluid consisting of an alternate refrigerant with a lower 
global warming potential than HFC-134a, compliance with the leakage 
standard is addressed in the regulations at 40 CFR 1037.115. Please see 
Section I.F.(2)(b) for a discussion related to alternative 
refrigerants.
    Consistent with the HD Phase 1 program and the light-duty rule, 
where we require that manufacturers attest to the durability of 
components and systems used to meet the CO2 standards (see 
75 FR 25689), we are requiring that manufacturers of heavy-duty 
vocational vehicles attest to the durability of these systems, and 
provide an engineering analysis that demonstrates component and system 
durability.
(e) Glider Vehicles
    EPA and NHTSA requested comment on gliders and received extensive 
comment. The main issues involve standards for rebuilt engines 
installed in new glider vehicles. These issues are fully addressed in 
Preamble Section XIII.B and RTC Section 14.2. Of relevance for the 
vocational vehicle sector, the final standards contain a number of 
provisions allowing donor engines that are still within their 
regulatory useful life to be used in new glider vehicles provided the 
engine meets all standards applicable to the year in which the engine 
was originally manufactured and also meets one of the following 
criteria:
     The engine is still within its original useful life in 
terms of both miles and years.
     The engine has less than 100,000 miles of engine 
operation.
     The engine is less than three years old.
    Thus, if a donor engine meeting one of the above criteria was 
manufactured before the Phase 1 GHG standards, it would not be subject 
to those standards when installed in a glider vehicle. Similarly, if 
such an engine was manufactured before 2010, it would be subject to the 
pre-2010 criteria pollutant standards corresponding to its year of 
manufacture. EPA is adopting this provision consistent with the 
original purpose of glider vehicles as providing a means of salvaging 
of relatively new powertrains from vehicle chassis that have been 
damaged or have otherwise failed prematurely. See Section XIII.B of the 
Preamble.

[[Page 73727]]

(3) Compliance Flexibility Provisions
    EPA and NHTSA are adopting several flexibility provisions in the 
Phase 2 program. Program-wide compliance flexibilities include an 
averaging, banking and trading program for CO2 emissions and 
fuel consumption credits, provisions for off-cycle credits for 
technologies that are not included as inputs to the GEM, and advanced 
technology credits. These are described below as well as in Section 
I.B.3 to I.C.1. Provisions that are not program-wide include optional 
chassis certification and a revised interim loose engines provision, as 
described below.
(a) Averaging, Banking, and Trading (ABT) Program
    Averaging, banking, and trading of emission credits have been an 
important part of many EPA mobile source programs under CAA Title II. 
ABT provisions provide manufacturers flexibilities that assist in the 
efficient development and implementation of new technologies and 
therefore enable new technologies to be implemented at a more 
aggressive pace than without ABT. NHTSA and EPA are carrying-over the 
Phase 1 ABT provisions for vocational vehicles into Phase 2, as it is 
an important way to achieve each agency's programmatic goals. ABT is 
also discussed in Section I and Section III.F.1.
    Consistent with the Phase 1 averaging sets, the agencies are 
allowing chassis manufacturers to average SI-powered vocational vehicle 
chassis with CI-powered vocational vehicle chassis, within the same 
vehicle weight class group. In Phase 1, all vocational and tractor 
chassis within a vehicle weight class group were able to average with 
each other, regardless of whether they were powered by a CI or SI 
engine. The Phase 2 approach continues this. The only difference is 
that in Phase 2, there are different numerical standards set for the 
SI-powered and CI-powered vehicles, but that does not alter the basis 
for averaging. This is consistent with the Phase 1 approach where, for 
example, Class 8 day cab tractors, Class 8 sleeper cab tractors and 
Class 8 vocational vehicles each have different numerical standards, 
while they all belong to the same averaging set.
    As discussed in V.D.(1)(c), EPA and NHTSA are adopting a revised 
useful life for LHD vocational vehicles for GHG emissions from the 
current 10 years/110,000 miles to 15 years/150,000 miles, to be 
consistent with the useful life of criteria pollutants recently updated 
in EPA's Tier 3 rule. For the same reasons, EPA and NHTSA are also 
adopting a useful life adjustment for HD pickups and vans, as described 
in Section VI.E.(1). According to the credits calculation formula at 40 
CFR 1037.705 and 49 CFR 535.7, useful life in miles is a multiplicative 
factor included in the calculation of CO2 and fuel 
consumption credits. In order to ensure that banked credits will 
maintain their value in the transition from Phase 1 to Phase 2, NHTSA 
and EPA are adopting an interim vocational vehicle adjustment factor of 
1.36 for credits that are carried forward from Phase 1 to the MY 2021 
and later Phase 2 standards.\454\ Without this adjustment factor the 
change in useful life would effectively result in a discount of banked 
credits that are carried forward from Phase 1 to Phase 2, which is not 
the intent of the change in the useful life. The agencies do not 
believe that this adjustment will result in a loss of program benefits 
because there is little or no deterioration anticipated for 
CO2 emissions and fuel consumption over the life of the 
vehicles. Also, the carry-forward of credits is an integral part of the 
program, helping to smooth the transition to the Phase 2 standards. The 
agencies believe that effectively discounting carry-forward credits 
from Phase 1 to Phase 2 is unnecessary and could negatively impact the 
feasibility of the Phase 2 standards. EPA and NHTSA requested comment 
on all aspects of the averaging, banking, and trading program. A 
complete discussion of the comments on credits and ABT can be found in 
the RTC Section 1.4.
---------------------------------------------------------------------------

    \454\ See 40 CFR 1037.150(o) and 49 CFR 535.7.
---------------------------------------------------------------------------

(b) Innovative and Off-Cycle Technology Credits
    In Phase 1, the agencies adopted an emissions and fuel consumption 
credit generating opportunity that applied to innovative technologies 
that reduce fuel consumption and CO2 emissions. Eligible 
technologies were required to not be in common use with heavy-duty 
vehicles before the 2010MY and not reflected in the GEM simulation tool 
(i.e., the benefits are ``off-cycle''). See 76 FR 57253. In Phase 2, 
the agencies are re-designating it as an off-cycle technology program. 
The agencies are maintaining the requirement that, in order for a 
manufacturer to receive credits for Phase 2, the off-cycle technology 
must not have been in common use prior to MY 2010.
    The agencies recognize that there are emerging technologies today 
that are being developed, but will not be accounted for in the GEM 
tool, and therefore will be considered off-cycle. For vocational 
vehicles, this could include technologies whose scope and effectiveness 
surpass those defined and pre-approved in the HD Phase 2 program, such 
as aerodynamics and electrified accessories. Any credits for these 
technologies will need to be based on real-world fuel consumption and 
GHG reductions that can be measured with verifiable test methods using 
representative driving conditions typical of the engine or vehicle 
application. More information about off-cycle technology credits can be 
found at Section I.C.1.c.
    As in Phase 1, the agencies will continue to provide two paths for 
approval of the test procedure to measure the CO2 emissions 
and fuel consumption reductions of an off-cycle technology used in 
vocational vehicles. See 40 CFR 1037.610 and 49 CFR 535.7. The first 
path will not require a public approval process of the test method. A 
manufacturer may use ``pre-approved'' test methods for HD vehicles 
including the A-to-B chassis testing, powerpack testing or on-road 
testing. A manufacturer may also use any developed test procedure that 
has known quantifiable benefits. A test plan detailing the testing 
methodology will be required to be approved prior to collecting any 
test data. The agencies are also continuing the second path, which 
includes a public approval process of any testing method that could 
have questionable benefits (i.e., an unknown usage rate for a 
technology). Furthermore, the agencies are adopting revisions to 
clarify what documentation must be submitted for approval, aligning 
them with provisions in 40 CFR 86.1869-12. NHTSA is prohibiting credits 
from technologies addressed by any of its crash avoidance safety 
rulemakings (i.e., congestion management systems). See also 77 FR 62733 
(discussion of similar issue in the light duty greenhouse gas/fuel 
economy regulations). We received extensive comment on the off-cycle 
technology approval process. In response to requests to develop a 
streamlined path for off-cycle technology approval, we are not making 
fundamental changes from the proposal at this time; however, we remain 
open to working with stakeholders to look for ways to simplify the 
process. For example, although we are including specific provisions to 
recognize certain electrified accessories, recognizing others would 
require the manufacturer to go through the off-cycle process. However, 
it is quite possible that the agencies could gather sufficient data to 
allow us to adopt specific provisions in a future rulemaking to 
recognize other accessories in a simpler

[[Page 73728]]

manner. Please see Section I.C. of this Preamble for further discussion 
of off-cycle credits.
    There are some technologies that are entering the market today, and 
although our model does not have the capability to simulate the 
effectiveness over the test cycles, there are reliable estimates of 
effectiveness available to the agencies. These will be recognized in 
our HD Phase 2 certification procedures as pre-defined technologies, 
and will not be considered off-cycle. Examples of such technologies for 
vocational vehicles include narrowly-defined types of electrified 
accessories or aerodynamic improvements. The agencies are specifying 
default effectiveness values to be used as valid inputs to GEM for each 
of these. The projected effectiveness of each vocational vehicle 
technology is discussed in the RIA Chapter 2.9.3.
    The agencies' approval for Phase 1 innovative technology credits 
(approved prior to 2021 MY) will be carried into the Phase 2 program on 
a limited basis for those technologies where the benefit is not 
accounted for in the Phase 2 test procedure. Therefore, the 
manufacturers will not be required to request new approval for any 
innovative credits carried into the off-cycle program, but will have to 
demonstrate, as part of the MY 2021 certification, the extent to which 
the new cycle does not account for these improvements. The agencies 
believe this is appropriate because technologies, such as those related 
to the transmission or driveline, may no longer be ``off-cycle'' 
because of the addition of these technologies into the Phase 2 version 
of GEM.
(c) Advanced Technology Credits
    As described above in Section I, the agencies proposed to 
discontinue advanced technology credits in Phase 2, which had been 
intended to promote the early implementation of advanced technologies 
that were not expected to be widely adopted in the market in the 2014 
to 2018 time frame. These technologies were defined in Phase 1 as 
hybrid powertrains, Rankine cycle engines, all-electric vehicles, and 
fuel cell vehicles (see 40 CFR 1037.150(p)), at a 1.5 credit value. We 
requested and received comments on the need for such incentives, and as 
a result we are not only continuing these credits, we are adopting even 
greater multipliers than before. See Section I of this Preamble for 
further discussion of the comments received and the agencies' response 
regarding advanced technology credits.
(d) Optional Chassis Certification
    In Phase 2, the agencies are continuing the Phase 1 option to 
chassis certify vehicles over 14,000 lbs GVWR, but only if there is a 
family with vehicles at or below 14,000 pounds GVWR that can properly 
accommodate the bigger vehicles as part of the same family. As adopted 
in this final rule, chassis-certified vehicles above 14,000 pounds GVWR 
may not rely on a work factor that is greater than the largest work 
factor that applies for vehicles at or below 14,000 pounds GVWR from 
the same family. Applying this work factor constraint avoids the need 
to set a specific upper GVWR limit on vehicles eligible to use this 
flexibility. See Section XIII.A.2 of this Preamble, and Section 14.3.2 
of the RTC, for further discussion of this issue.
(e) Certifying Loose SI Engines in Vocational Vehicles in Phase 2
    The agencies proposed not to continue the Phase 1 interim 
flexibility known as the ``loose engine'' provision, receiving 
favorable comment from Cummins and adverse comment on this from Isuzu 
and AAPC. 80 FR 40331. Under this provision, SI engines produced by 
manufacturers of HD pickup trucks and vans and sold to chassis 
manufacturers and intended for use in vocational vehicles need not meet 
the separate SI engine standard, and instead may be averaged with the 
manufacturer's HD pickup and van fleet (see 40 CFR 86.1819-14(k)(8)). 
The agencies are adopting a Phase 2 SI engine standard that is no more 
stringent than the MY 2016 SI engine standard adopted in Phase 1, while 
the Phase 2 standards for the HD pickup and van fleet is progressively 
more stringent through MY 2027. The primary certification path designed 
in the Phase 1 program for both CI and SI engines sold separately and 
intended for use in vocational vehicles is that they are engine 
certified while the vehicle is GEM certified under the GHG rules.
    This provision was adopted primarily to address small volume sales 
of engines used in complete vehicles that are also sold to other 
manufacturers. The Phase 1 final rules explain that we set the 
effective date of the Phase 1 SI engine standard as MY 2016 because we 
projected by this time all manufacturers would have redesigned their 
gasoline engine offerings to adopt the technologies needed to reduce 
FTP-cycle emissions by five percent; technologies that cannot simply be 
bolted on to an existing engine but can only be effectively applied 
through an integrated design and development process (76 FR 57180, 
57235). The Phase 1 final rules also explain that the compliance 
flexibility provided by the loose engine provision is technically 
appropriate because it provides manufacturers with an option to focus 
their energy on improving the GHG and fuel consumption performance of 
their complete vehicle products (including engine improvements), rather 
than on concurrently calibrating for both vehicle and engine test 
compliance (76 FR 57260). At proposal we noted that although gasoline 
engine manufacturers have accomplished extensive improvements to comply 
with HD pickup and vans standards as well as the light-duty vehicle 
standards, the agencies had not seen evidence of the engine redesigns 
that we had projected to occur by 2016, and we concluded that 
discontinuation of this flexibility by MY 2021 was appropriate to 
provide regulatory certainty on the date beyond which engine 
certification would be mandatory for HD SI engines.
    However, in response to persuasive comments from a chassis 
manufacturer that purchases these engines, we are adopting a narrow 
extension of this interim flexibility, where for MYs 2021-2023, each SI 
engine manufacturer may sell an annual maximum of 10,000 SI engines 
certified under this provision.\455\ We believe this three-year 
extension is needed to prevent market disruptions. We are concerned 
that SI engine manufacturers might not choose to certify any SI engines 
that can be sold to other vocational chassis manufacturers, which would 
significantly disrupt the market. With this limited extension, we are 
ensuring no loss of environmental benefits because any vehicle 
certified by a chassis manufacturer who obtains a high-emitting SI 
engine must apply additional technology as needed to meet the 
applicable vocational vehicle standard. We are generally not allowing 
custom chassis manufacturers to use SI engines that have been certified 
under this loose engine provision, if they are certifying using one of 
the custom chassis regulatory subcategories. However, manufacturers 
certifying motor homes or emergency vehicles to the optional standards 
may install engines certified through the interim loose engine 
provision. The typical annual miles driven by these vehicles is very 
low, usually between 2,000 and 5,000 miles for either motor homes or 
emergency vehicles, and thus their contribution to emissions and fuel 
consumption is very small. See Section II of this Preamble for a 
discussion of

[[Page 73729]]

the comments received and the agencies' response on the separate engine 
standard for SI engines intended for vocational vehicles.
---------------------------------------------------------------------------

    \455\ Meeting with Isuzu dated April 22, 2016.
---------------------------------------------------------------------------

(f) On-Board Diagnostics for Hybrid Vehicle Systems
    In HD Phase 1, EPA adopted provisions to delay the onboard 
diagnostics (OBD) requirements for heavy-duty hybrid powertrains (see 
40 CFR 86.010-18(q)). This provision delayed full OBD requirements for 
hybrids until MY 2016 and MY 2017. The agencies have received comments 
from hybrid manufacturers regarding their progress toward meeting the 
on-board diagnostic requirements for criteria pollutant engine 
certification related to hybrid systems. See Section XIII.A.1 for a 
discussion of comments received and EPA's response related to 
certification of engines paired with hybrid powertrain systems.

VI. Heavy-Duty Pickups and Vans

    In the NPRM, the agencies conducted coordinated and complementary 
analyses using two analytical methods for the heavy-duty pickup and van 
segment, both of which used the same version of NHTSA's CAFE model to 
analyze technology. The agencies have also used two analytical methods 
for the joint final rule. However, unlike the NPRM, for the joint final 
rule, the agencies are using different versions of NHTSA's CAFE model 
to analyze technology. The Method B approach continues to use the same 
version of the model and inputs that was used for the NPRM. Method A 
uses an updated version of the CAFE model and some updated inputs.

A. Summary of Phase 1 HD Pickup and Van Standards

    In the Phase 1 rule, EPA and NHTSA established GHG and fuel 
consumption standards and a program structure for complete Class 2b and 
3 heavy-duty vehicles (referred to in these rules as ``HD pickups and 
vans''), as described below. The Phase 1 standards began to be phased-
in in MY 2014 and the agencies believe the program is working well. The 
agencies are retaining most elements from the structure of the program 
established in the Phase 1 rule for the Phase 2 program while 
establishing more stringent Phase 2 standards for MY 2027, phased in 
over MYs 2021-2027, that will require additional GHG reductions and 
fuel consumption improvements. As discussed below, the agencies are 
adopting the Phase 2 standards as proposed. The MY 2027 standards will 
remain in place unless and until amended by the agencies.
    Heavy-duty vehicles with GVWR between 8,501 and 10,000 lbs. are 
classified in the industry as Class 2b motor vehicles. Class 2b 
includes vehicles classified as medium-duty passenger vehicles (MDPVs) 
such as very large SUVs. Because MDPVs are frequently used like light-
duty passenger vehicles, they are regulated by the agencies under the 
light-duty vehicle rules. Thus, the agencies did not adopt additional 
requirements for MDPVs in the Phase 1 rule and are not adopting 
additional requirements for MDPVs in this rulemaking. Heavy-duty 
vehicles with GVWR between 10,001 and 14,000 lbs are classified as 
Class 3 motor vehicles. Class 2b and Class 3 heavy-duty vehicles 
together emit about 23 percent of today's GHG emissions from the heavy-
duty vehicle sector.
    About 90 percent of HD pickups and vans are \3/4\-ton and 1-ton 
pickup trucks, 12- and 15-passenger vans, and large work vans that are 
sold by vehicle manufacturers as complete vehicles, with no secondary 
manufacturer making substantial modifications prior to registration and 
use. Most of these vehicles are produced by companies with major light-
duty markets in the United States, primarily Ford, General Motors, and 
Fiat Chrysler. Often, the technologies available to reduce fuel 
consumption and GHG emissions from this segment are similar to the 
technologies used for the same purpose on light-duty pickup trucks and 
vans, including both engine efficiency improvements (for gasoline and 
diesel engines) and vehicle efficiency improvements.
    In the Phase 1 rule, EPA adopted GHG standards for HD pickups and 
vans based on the whole vehicle (including the engine), expressed as 
grams of CO2 per mile, consistent with the way these 
vehicles are regulated by EPA today for criteria pollutants. NHTSA 
adopted corresponding gallons per 100 mile fuel consumption standards 
that are likewise based on the whole vehicle. This complete vehicle 
approach adopted by both agencies for HD pickups and vans was 
consistent with the recommendations of the NAS Committee in its 2010 
Report. EPA and NHTSA adopted a structure for the Phase 1 HD pickup and 
van standards that in many respects paralleled long-standing NHTSA CAFE 
standards and more recent coordinated EPA GHG standards for 
manufacturers' fleets of new light-duty vehicles. These commonalities 
include a new vehicle fleet average standard for each manufacturer in 
each model year and the determination of these fleet average standards 
based on production volume-weighted targets for each model, with the 
targets varying based on a defined vehicle attribute. Vehicle testing 
for both the HD and light-duty vehicle programs is conducted on chassis 
dynamometers using the drive cycles from the EPA Federal Test Procedure 
(Light-duty FTP or ``city'' test) and Highway Fuel Economy Test (HFET 
or ``highway'' test).\456\
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    \456\ The Light-duty FTP is a vehicle driving cycle that was 
originally developed for certifying light-duty vehicles and 
subsequently applied to HD chassis testing for criteria pollutants. 
This contrasts with the Heavy-duty FTP, which refers to the 
transient engine test cycles used for certifying heavy-duty engines 
(with separate cycles specified for diesel and spark-ignition 
engines).
---------------------------------------------------------------------------

    For the light-duty GHG and fuel economy \457\ standards, the 
agencies factored in vehicle size by basing the emissions and fuel 
economy targets on vehicle footprint (the wheelbase times the average 
track width).\458\ For those standards, passenger cars and light trucks 
with larger footprints are assigned higher GHG and lower fuel economy 
target levels in acknowledgement of their inherent tendency to consume 
more fuel and emit more GHGs per mile. EISA requires that NHTSA study 
``the appropriate metric for measuring and expressing commercial 
medium- and heavy-duty vehicle and work truck fuel efficiency 
performance, taking into consideration, among other things, the work 
performed by such on-highway vehicles and work trucks . . .'' See 49 
U.S.C. 32902(k)(1)(B).\459\ For HD pickups and vans, the agencies also 
set standards based on a vehicle attribute, but used a work-based 
metric as the attribute rather than the footprint attribute utilized in 
the light-duty vehicle rulemaking. Work-based measures such as payload 
and towing capability are key among the parameters that characterize 
differences in the design of these vehicles, as well as differences in 
how the vehicles will be utilized. Buyers consider these utility-based 
attributes when purchasing a HD pickup or van. EPA and NHTSA therefore 
finalized Phase 1 standards for HD pickups and vans based on a ``work 
factor'' attribute that combines the vehicle's payload and towing 
capabilities, with an added adjustment

[[Page 73730]]

for 4-wheel drive vehicles. See generally 76 FR 57161-57162.
---------------------------------------------------------------------------

    \457\ Light duty fuel economy standards are expressed as miles 
per gallon (mpg), which is inverse to the HD fuel consumption 
standards which are expressed as gallons per 100 miles.
    \458\ EISA requires CAFE standards for passenger cars and light 
trucks to be attribute-based; See 49 U.S.C. 32902(b)(3)(A).
    \459\ The NAS 2010 report likewise recommended standards 
recognizing the work function of HD vehicles. See 76 FR 57161.
---------------------------------------------------------------------------

    For Phase 1, the agencies adopted provisions such that each 
manufacturer's fleet average standard is based on production volume-
weighting of target standards for all vehicles that in turn are based 
on each vehicle's work factor. These target standards are taken from a 
set of curves (mathematical functions). The Phase 1 curves are shown in 
the figures below for reference and are described in detail in the 
Phase 1 final rule.\460\ The agencies established separate curves for 
diesel and gasoline HD pickups and vans. The agencies will continue to 
use the work-based attribute and gradually declining standards approach 
for the Phase 2 standards, as discussed in Section VI.B. below. Note 
that this approach does not create an incentive to reduce the 
capabilities of these vehicles because less capable vehicles are 
required to have proportionally lower emissions and fuel consumption 
targets.
---------------------------------------------------------------------------

    \460\ The Phase 1 Final Rule provides a full discussion of the 
standard curves including the equations and coefficients. See 76 FR 
57162-57165, September 15 2011. The standards were previously 
provided in the regulations at 40 CFR 1037.104, but they are now 
being redesignated as 40 CFR 86.1819-14.
    \461\ The NHTSA program provides voluntary standards for model 
years 2014 and 2015. Target line functions for 2016-2018 are for the 
second NHTSA alternative described in the Phase 1 Preamble Section 
II.C.(d)(ii).
[GRAPHIC] [TIFF OMITTED] TR25OC16.010


[[Page 73731]]


[GRAPHIC] [TIFF OMITTED] TR25OC16.011

    EPA phased in its CO2 standards gradually starting in 
the 2014 model year, at 15-20-40-60-100 percent of the model year 2018 
standards stringency level in model years 2014-2015-2016-2017-2018, 
respectively. The phase-in takes the form of the set of target standard 
curves shown above, with increasing stringency in each model year. The 
final EPA Phase 1 standards for 2018 (including a separate standard to 
control air conditioning system leakage) represent an average per-
vehicle reduction in GHGs of 17 percent for diesel vehicles and 12 
percent for gasoline vehicles, compared to a common MY 2010 baseline. 
EPA also finalized a compliance alternative whereby manufacturers can 
phase in different percentages: 15-20-67-67-67-100 percent of the model 
year 2019 standards stringency level in model years 2014-2015-2016-
2017-2018-2019, respectively. This compliance alternative parallels and 
is equivalent to NHTSA's first alternative described below.
    NHTSA's Phase 1 program allows manufacturers to select one of two 
fuel consumption standard alternatives for model years 2016 and later. 
The first alternative defines individual gasoline vehicle and diesel 
vehicle fuel consumption target curves that will not change for model 
years 2016-2018, and are equivalent to EPA's 67-67-67-100 percent 
target curves in model years 2016-2017-2018-2019, respectively. This 
option is consistent with EISA requirements that NHTSA provide 4 years 
lead-time and 3 years of stability for standards. See 49 U.S.C. 
32902(k)(3). The second alternative uses target curves that are 
equivalent to EPA's 40-60-100 percent target curves in model years 
2016-2017-2018, respectively. This option is also consistent with EISA 
lead-time and stability requirements. Stringency for the alternatives 
in Phase 1 was selected by the agencies to allow a manufacturer, 
through the use of the credit carry-forward and carry-back provisions 
that the agencies also finalized, to meet both NHTSA fuel efficiency 
and EPA GHG emission standards using a single compliance strategy. If a 
manufacturer cannot meet an applicable standard in a given model year, 
it may make up its shortfall by over-complying in a subsequent year. 
NHTSA also allows manufacturers to voluntarily opt into the NHTSA HD 
pickup and van program in model years 2014 or 2015. For these model 
years, NHTSA's fuel consumption target curves are equivalent to EPA's 
target curves. The Phase 1 phase-in options are summarized in Table VI-
1.

                                                     Table VI-1--Phase 1 Standards Phase-In Options
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              2014  %         2015  %         2016  %         2017  %         2018  %         2019  %
--------------------------------------------------------------------------------------------------------------------------------------------------------
EPA Primary Phase-in....................................              15              20              40              60             100             100
EPA Compliance Option...................................              15              20              67              67              67             100

[[Page 73732]]

 
NHTSA First Option......................................               0               0              67              67              67             100
NHTSA Second Option.....................................               0               0              40              60             100             100
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    The form and stringency of the Phase 1 standards curves are based 
on the performance of a set of vehicle, engine, and transmission 
technologies expected (although not required) to be used to meet the 
GHG emissions and fuel economy standards for model year 2012-2016 
light-duty vehicles, with full consideration of how these technologies 
are likely to perform in heavy-duty vehicle testing and use. All of 
these technologies are already in use or have been announced for 
upcoming model years in some light-duty vehicle models, and some are in 
use in a portion of HD pickups and vans as well. The technologies 
include:

 advanced 8-speed automatic transmissions
 aerodynamic improvements
 electro-hydraulic power steering
 engine friction reductions
 improved accessories
 low friction lubricants in powertrain components
 lower rolling resistance tires
 lightweighting
 gasoline direct injection
 diesel aftertreatment optimization
 air conditioning system leakage reduction (for EPA program 
only)

B. HD Pickup and Van Final Phase 2 Standards

    As described in this section, NHTSA and EPA are adopting as 
proposed Phase 2 standards that will be phased in over model years 
2021-2027 and continue thereafter unless and until amended. These 
standards are identical to those proposed as Alternative 3 (the 
preferred alternative at proposal). The agencies are adopting standards 
based on a year-over-year increase in stringency of 2.5 percent over 
MYs 2021-2027 for a total increase in stringency for the Phase 2 
program of about 16 percent compared to the MY 2018 Phase 1 standard. 
Note that an individual manufacturer's fleet-wide target may differ 
from this stringency increase due to changes in vehicle sales mix and 
changes in work factor. We believe the standards the agencies are 
adopting are feasible in the time frame of this rule.
    As discussed in detail below in Sections C through F, the agencies 
performed separate analyses, which we refer to as ``Method A'' and 
``Method B.'' NHTSA considered Method A as the central analysis in its 
determination of the stringency of the Phase 2 standards. EPA 
considered the results of Method B as the central analysis for its 
determination of the stringency of the Phase 2 standards. These 
analyses are complementary, and independently support the same 
conclusion.
    In the proposal, the agencies also sought comment on a number of 
alternatives, including an alternative (`Alternative 4') which would 
have resulted in approximately the same stringency increase, but would 
have done so two years earlier (in MY 2025 rather than MY 2027), so 
that the effective year-over-year stringency would have been 3.5%. The 
agencies are not adopting this alternative. The agencies' analyses show 
that the additional lead-time provided by the Phase 2 standards that 
the agencies are adopting will allow manufacturers to more fully 
utilize lower cost technologies over vehicle life-cycles. In addition, 
under the method B analysis, this would reduce the projected adoption 
rate of more advanced higher cost technologies such as strong hybrids 
compared to Alternative 4. As discussed in more detail in E.1 below, 
both of the considered phase-ins are projected to require comparable 
penetration rates of several non-hybrid technologies with some 
approaching 100 percent penetration. However, as discussed below, the 
additional lead-time provided by the final standards will allow 
manufacturers more flexibility to implement technologies at later 
redesigns and refreshes. The agencies received several comments 
regarding the timing and stringency of the standards. These comments 
are discussed in detail in Section E.1 below and in Chapter 7 of the 
Response to Comments document.
    When considering potential Phase 2 standards, the agencies 
anticipate that the technologies listed above that were considered in 
Phase 1 will continue to be available in the future, if not already 
applied under Phase 1 standards, and that additional technologies will 
also be available:

 advanced engine improvements for friction reduction and low 
friction lubricants
 improved engine parasitics, including fuel pumps, oil pumps, 
and coolant pumps
 valvetrain variable lift and timing
 cylinder deactivation
 direct gasoline injection
 cooled exhaust gas recirculation
 turbo downsizing of gasoline engines
 Diesel engine efficiency improvements
 downsizing of diesel engines
 8-speed automatic transmissions
 electric power steering
 high efficiency transmission gear boxes and driveline
 further improvements in accessory loads
 additional improvements in aerodynamics and tire rolling 
resistance
 low drag brakes
 mass reduction
 mild hybridization
 strong hybridization

    Sections VI.C below and Section 2 of the RIA provide a detailed 
analysis of these and other potential technologies for Phase 2, 
including their feasibility, costs, and effectiveness and projected 
application rates for reducing fuel consumption and CO2 
emissions when utilized in HD pickups and vans. Sections VI.D and 
Section X also discuss the selection of the Phase 2 standards and the 
alternatives considered.
    In addition to EPA's CO2 emission standards and NHTSA's 
fuel consumption standards for HD pickups and vans, EPA in Phase 1 also 
finalized standards for two additional GHGs--N2O and 
CH4, as well as standards for air conditioning-related HFC 
emissions. EPA will continue these standards in Phase 2. Also, 
consistent with CAA section 202(a)(1), EPA finalized Phase 1 standards 
that apply to HD pickups and vans in use and EPA is likewise adopting 
in-use standards for these vehicles in Phase 2. All of these standards 
are discussed in more detail below. Program flexibilities and 
compliance provisions related to the standards for HD pickups and vans 
are discussed in Section VI.E.
    A relatively small number of HD pickups and vans are sold by 
vehicle manufacturers as incomplete vehicles, without the primary load-
carrying device or container attached. A sizeable

[[Page 73733]]

subset of these incomplete vehicles, often called cab-chassis vehicles, 
are sold by the vehicle manufacturers in configurations with complete 
cabs plus many of the components that affect GHG emissions and fuel 
consumption identical to those on complete pickup truck or van 
counterparts--including engines, cabs, frames, transmissions, axles, 
and wheels. The Phase 1 program includes provisions that allow 
manufacturers to include these incomplete vehicles, as well as some 
Class 4 through 6 vehicles, to be regulated under the chassis-based HD 
pickup and van program (i.e. subject to the standards and chassis 
certification for HD pickups and vans), rather than under the 
vocational vehicle program.\462\ The agencies are continuing to allow 
such incomplete vehicles the option of certifying under either the 
heavy duty pickup and van standards or the standards for vocational 
vehicles. As in Phase 1, if such an incomplete vehicle is certified as 
a vocational vehicle, the engine would have to be certified separately 
to the applicable engine standard.
---------------------------------------------------------------------------

    \462\ See 76 FR 57259-57260, September 15, 2011 and 78 FR 36374, 
June 17, 2013.
---------------------------------------------------------------------------

    Phase 1 also includes optional compliance paths for spark-ignition 
engines identical to engines used in heavy-duty pickups and vans to 
comply with 2b/3 standards. See 40 CFR 1037.150(m) and 49 CFR 
535.5(a)(7). Manufacturers sell such engines as ``loose engines'' or 
install these engines in incomplete vehicles that are not cab-complete 
vehicles. The agencies are providing a temporary loose engine provision 
for Phase 2 as described in Section V.D.3.e, under Compliance 
Flexibility Provisions. These program elements are discussed above in 
Section V.D. on vocational vehicles and XIII.A.2 on engines.
(1) Vehicle-Based Standards
    For Phase 1, EPA and NHTSA chose to set vehicle-based standards 
whereby the entire vehicle is chassis-tested. The agencies will retain 
this approach for Phase 2. About 90 percent of Class 2b and 3 vehicles 
are pickup trucks, passenger vans, and work vans that are sold by the 
original equipment manufacturers as complete vehicles, ready for use on 
the road. In addition, most of these complete HD pickups and vans are 
covered by CAA vehicle emissions standards for criteria pollutants 
(i.e., they are chassis tested similar to light-duty), expressed in 
grams per mile. This distinguishes this category from other, larger 
heavy-duty vehicles that typically have engines covered by CAA engine 
emission standards for criteria pollutants, expressed in grams per 
brake horsepower-hour. As a result, Class 2b and 3 complete vehicles 
share both substantive elements and a regulatory structure much more in 
common with light-duty trucks than with the other heavy-duty vehicles.
    Three of these features in common are especially significant: (1) 
Over 95 percent of the HD pickups and vans sold in the United States 
are produced by Ford, General Motors, and Fiat Chrysler--three 
companies with large light-duty vehicle and light-duty truck sales in 
the United States; (2) these companies typically base their HD pickup 
and van designs on higher sales volume light-duty truck platforms and 
technologies, often incorporating new light-duty truck design features 
into HD pickups and vans at their next design cycle, and (3) at this 
time most complete HD pickups and vans are certified to vehicle-based 
rather than engine-based EPA criteria pollutant and GHG standards. 
There is also the potential for substantial GHG and fuel consumption 
reductions from vehicle design improvements beyond engine changes (such 
as through optimizing aerodynamics, weight, tires, and accessories), 
and a single manufacturer is generally responsible for both engine and 
vehicle design. All of these factors together suggest that it is still 
appropriate and reasonable to base standards on performance of the 
vehicle as a whole, rather than to establish separate engine and 
vehicle GHG and fuel consumption standards, as is being done for the 
other heavy-duty categories. The chassis-based standards approach for 
complete vehicles is also consistent with NAS \463\ recommendations and 
there was consensus in the public comments in the Phase 1 rulemaking 
supporting this approach. For all of these reasons, the agencies 
proposed to continue this approach, and there was again supporting 
consensus in the public comments.
---------------------------------------------------------------------------

    \463\ The NAS 2010 report. See 76 FR 57161.
---------------------------------------------------------------------------

(a) Work-Based Attributes
    In developing the Phase 1 HD rulemaking, the agencies emphasized 
creating a program structure that achieves reductions in fuel 
consumption and GHGs based on how vehicles are used and on the work 
they perform in the real world. Work-based measures such as payload and 
towing capability are key among the things that characterize 
differences in the design of vehicles, as well as differences in how 
the vehicles will be used. Vehicles in the 2b and 3 categories have a 
wide range of payload and towing capacities. These work-based 
differences in design and in-use operation are key factors in 
evaluating technological improvements for reducing CO2 
emissions and fuel consumption. Payload has a particularly important 
impact on the test results for HD pickup and van emissions and fuel 
consumption, because testing under existing EPA procedures for criteria 
pollutants and the Phase 1 standards is conducted with the vehicle 
loaded to half of its payload capacity (rather than to a flat 300 lbs. 
as in the light-duty program), and the correlation between test weight 
and fuel use is strong.
    Towing, on the other hand, does not directly factor into test 
weight as nothing is towed during the test. Hence, setting aside any 
interdependence between towing capacity and payload, only the higher 
curb weight caused by any heavier truck components plays a role in 
affecting measured test results. However towing capacity can be a 
significant factor to consider because HD pickup truck towing 
capacities can be quite large, with a correspondingly large effect on 
vehicle design.
    We note too that, from a purchaser perspective, payload and towing 
capability typically play a greater role than physical dimensions in 
influencing purchaser decisions on which heavy-duty vehicle to buy. For 
passenger vans, seating capacity is of course a major consideration, 
but this correlates closely with payload weight.
    For these reasons, as noted above, EPA and NHTSA set Phase 1 
standards for HD pickups and vans based on a ``work factor'' attribute 
that combines vehicle payload capacity and vehicle towing capacity, in 
lbs., with an additional fixed adjustment for four-wheel drive (4wd) 
vehicles. This adjustment accounts for the fact that 4wd, critical to 
enabling many off-road heavy-duty work applications, adds roughly 500 
lbs. to the vehicle weight. The work factor is calculated as follows: 
75 percent maximum payload + 25 percent of maximum towing + 375 lbs. if 
4wd. Under this approach, target GHG and fuel consumption standards are 
determined for each vehicle with a unique work factor (analogous to a 
target for each discrete vehicle footprint in the light-duty vehicle 
rules). These targets will then be production weighted and summed to 
derive a manufacturer's annual fleet average standard for its heavy-
duty pickups and vans. There was widespread support (and no opposition) 
for the work factor-based approach to standards and fleet average 
approach to compliance expressed in

[[Page 73734]]

the comments we received on the Phase 1 rule.
    For Phase 2, the agencies proposed to continue using the work-based 
attribute. The agencies received a variety of comments on the details 
of the work factor approach. The agencies received comments from The 
American Council for an Energy-Efficient Economy (ACEEE) regarding the 
definition of payload and towing and manufacturer's discretion at 
determining GVWR, GCWR and curb weight of the vehicle. In response, the 
formula for payload, GVWR minus curb weight, is specified such that it 
uses the same definition of the input terms as those which have always 
been used by the agencies for light and heavy duty vehicle regulations, 
including criteria pollutant emission standards and safety related 
designations. The agencies feel that there is no ambiguity in the 
definition of these terms and therefore that payload calculation 
remains clearly defined with little or no opportunity for manipulation. 
The agencies have successfully used the previously established 
definitions of GVWR and curb weight to implement emissions and safety 
related programs and have not experienced any adverse issues in 
applying these definitions. The same is true for the definitions of 
terms used to calculate towing--GCWR minus GVWR. While this definition 
for towing capacity does not match the method used by manufacturers in 
their consumer advertising, the agencies determined that the inputs of 
GCWR and GVWR are clearly defined in our regulations and used for many 
other emission and safety related determinations and therefore also 
remain a clear and consistent method to define towing for the purposes 
of calculating work factor. Again, the agencies have successfully used 
the previously established definitions of GCWR and have not experienced 
any issues that would warrant a change to the definition or use of 
these parameters.
    ACEEE commented on recent announcements from two manufacturers that 
reported increases in payload capacity in their pick-ups due to a 
decrease in the curb weight of the vehicles from changes to light-
weight materials. A reduction in vehicle weight while maintaining the 
same GVWR will result in a higher payload capacity which will then 
increase that vehicle's calculated work factor and therefore result in 
a higher (less stringent) target GHG and fuel consumption standard. 
Similar to the light-duty (LD) footprint based approach which allows 
increases in GHG emissions and fuel consumption with increasing 
footprints, the work factor is designed to allow increases in GHG 
emissions and fuel consumption with increases in capability to do work, 
primarily hauling payload and towing. Decreases in curb weight as 
described in the comment actually demonstrate that the work factor is 
operating both appropriately and as the agencies intended. By reducing 
curb weight, these manufacturers are increasing the work capability of 
their trucks specifically purchased by consumers to transport payload 
and (sometimes) to tow. Additional payload capacity, while not always 
needed, will allow the user to transport more goods resulting in an 
overall reduction in GHGs and fuel used versus taking additional trips 
to do the same work. This may differ from light-duty pick-ups where 
transportation of goods may not be the primary use of the vehicle. 
Additionally, the reduction in curb weight will be beneficial in all 
other situations of unloaded and partially loaded transport of goods 
because a reduction in curb weight of the vehicle results in less 
energy wasted simply to move the vehicle regardless of payload. For 
this reason, the agencies included mass reduction as among the 
technologies on which the stringency of the final standards (as well as 
the phase 1 standards) is based. Mass reduction is discussed in detail 
in the technology descriptions section below.
    Most of the comments supported the continued use of work factor-
based standards for heavy duty pickups and vans. The agencies received 
several comments regarding surplus towing. The American Automotive 
Policy Council (AAPC) commented that existing NHTSA Federal Motor 
Vehicle Safety Standards effectively cap the towing and GCWR in this 
vehicle segment. Cummins noted that the curves were data-based in Phase 
1 and any changes to the curves would require a full study, similar to 
Phase 1, in order to ensure feasibility and a fair framework for all 
OEMs. Daimler commented in support of changing weighting of payload to 
80 percent and towing to 20 percent of work factor formula and did not 
oppose a cap on towing. Several commenters supported adopting a 
mechanism to minimize the incentive the standards provide to increase 
work factor. ACEEE supported further considering changing the shape of 
the standards curves, shown below in Figure VI-3 and Figure VI-4, to be 
flatter at higher work factors. Honeywell commented that towing 
capacity has increased significantly over the last five years, beyond 
the needs of most buyers, and that the curves should be flattened 
starting at 7,500 lbs, noting that this change would impact less that 
10 percent of all class 2b/3 vehicles. The International Council on 
Clean Transportation (ICCT) similarly suggested a cut point of 5,500 
lbs. for gasoline trucks and 8,000 lbs. for diesels, based on these 
cutpoints being near the 90th percentile for the model year 2014 fleet. 
The Union of Concerned Scientists (UCS) (like ACEEE) commented that 
light-weighting is being used to increase payload and also supported 
leveling off the curves to eliminate the incentive to add payload and 
towing capacity.
    After considering these comments, the agencies concluded that the 
work factor approach established in the Phase 1 rule appropriately 
accounts for the different utility aspects of heavy-duty vehicles. 
While trucks and vans may be used differently depending on the required 
job, the three main attributes of payload, towing and four wheel drive 
remain properly accounted for at this time in the work factor equation 
at the current weightings. While a small portion of the fleet may be 
considered to have excess towing capacity relative to the actual 
required towing capacity by the customer, the agencies determined that 
the work factor design does not necessarily result in an incentive for 
manufacturers to build excessive towing into the vehicle design. Towing 
capacity increases require improvements to vehicle powertrains, cooling 
and brakes, generally at the expense of payload, and therefore the work 
factor reasonably balances an increase in towing with a reduction in 
payload. Additionally, increases in vehicle weight for additional 
towing capacity may result in an increase in the emission test weight, 
further penalizing unnecessary towing capacity. Moreover, as AAPC 
discusses in their comments, towing and payload are effectively already 
capped by existing NHTSA safety requirements in this segment. Consumers 
will ultimately decide on the appropriate balance of payload and towing 
for their applications, and the agencies therefore believe that 
establishing a work factor cap for the small percentage of vehicles 
with the highest towing capabilities is not necessary and will not 
result in emission increases or fuel consumption reductions under the 
high towing conditions for which those vehicles were purchased.
    The agencies also received comments regarding making changes to the 
work factor formula for vans. AAPC commented that the payload, towing, 
and 4wd inputs do not fully represent the intended uses of cargo and 
passenger vans, where cargo or

[[Page 73735]]

passenger volumes are of primary importance. AAPC recommended that the 
agencies add a volumetric term to the work factor for vans with high 
(208 cubic feet or greater) cargo and passenger volumes. Vans with high 
volumes would have higher work factors and therefore less stringent 
targets with the AAPC recommended formula compared to the current 
formula. ACEEE commented that the work factor is a far better predictor 
of fuel efficiency for pickups than for vans and offered general 
support for adopting different work factor formulas for pickups and 
vans.
    While it is likely that a portion of the vans are used exclusively 
for cargo volume and that towing is not an important attribute for 
these vans, the commenter failed to provide sufficient new information 
to support a new work factor metric specifically to address cargo 
focused vans. The commenter's suggested modification does not 
sufficiently represent the different van cargo volumes available to 
consumers today. A cargo volume based modification requires a complete 
industry van analysis of all available van cargo volumes and GHG and 
fuel economy performance levels from which an appropriately normalized 
adjustment would be determined, consistent with the approach used to 
establish the existing work factor equation for the attributes of 
payload, towing and four wheel drive. The agencies did not receive the 
level of detailed information required to determine the impact of cargo 
volume and establish a work factor correlation. Accordingly, the 
agencies are not incorporating the suggested change to the work factor 
for vans.
    As noted in the Phase 1 rule, the attribute-based CO2 
and fuel consumption standards are meant to be as consistent as 
practicable from a stringency perspective. Vehicles across the entire 
range of the HD pickup and van segment have their respective target 
values for CO2 emissions and fuel consumption, and therefore 
all HD pickups and vans will be affected by the standard. With this 
attribute-based standards approach, EPA and NHTSA continue to believe 
there should be no significant effect on the relative distribution of 
vehicles with differing capabilities in the fleet, which means that 
buyers should still be able to purchase the vehicle that meets their 
needs.
(b) Standards
    The agencies are adopting Phase 2 standards as proposed based on 
analyses performed to determine the appropriate HD pickup and van Phase 
2 standards and the most appropriate phase in of those standards. These 
analyses, described below and in the Final RIA, considered:

 projections of future U.S. sales for HD pickups and vans
 the estimates of corresponding CO2 emissions and 
fuel consumption for these vehicles
 forecasts of manufacturers' product redesign schedules
 the technology available in new MY 2014 HD pickups and vans to 
specify preexisting technology content to be included in the analysis 
fleet (the fleet of vehicles used as a starting point for analysis) 
extending through MY 2030
 the estimated effectiveness, cost, applicability, and 
availability of technologies for HD pickup and vans
 manufacturers' ability to use credit carry-forward
 the levels of technology that are projected to be added to the 
analysis fleet through MY 2030 \464\ considering improvements needed in 
order to achieve compliance with the Phase 1 standards (thus defining 
the reference fleet--i.e., under the No-Action Alternative--relative to 
which to measure incremental impacts of Phase 2 standards), and
---------------------------------------------------------------------------

    \464\ Although the final standards are implemented in MY 2027, 
the model looks out to MY 2030 to help account for the potential use 
of credit carry-forward provisions.
---------------------------------------------------------------------------

 the levels of technology that are projected to be added to the 
analysis fleet through MY 2030 considering further improvements needed 
in order to achieve compliance with standards defining each regulatory 
(action) alternative for Phase 2.

    Based on this analysis, EPA is adopting as proposed CO2 
attribute-based target standards shown in Figure VI-3 and Figure VI-4, 
and NHTSA is adopting as proposed the equivalent attribute-based fuel 
consumption target standards, also shown in Figure VI-3 and Figure VI-
4, applicable in model year 2021-2027. As shown in these figures, the 
Phase 2 standards will be phased in year-by-year commencing in MY 2021. 
The agencies did not propose and are not adopting changes to the 
standards for 2018-2020 and therefore the standards will remain at the 
MY 2018 Phase 1 levels for MYs 2019 and 2020. EISA requires four years 
of lead-time and three years stability for NHTSA standards and this 
period of lead-time and stability for 2018-2020 is thus consistent with 
the EISA requirements. For MYs 2021-2027, the agencies are finalizing 
as proposed annual reductions (i.e., increases in stringency) in the 
standards. These standards become 16 percent more stringent overall 
between MY 2020 and MY 2027, compared to the MY 2018 Phase 1 levels. 
This approach to the Phase 2 standards as a whole can be considered a 
phase-in or implementation schedule of the MY 2027 standards (which, as 
noted, will apply thereafter unless and until amended).
    For EPA, Section 202(a) (1) provides the Administrator with the 
authority to establish standards, and to revise those standards ``from 
time to time,'' thus providing the Administrator with considerable 
discretion in deciding when to revise the Phase 1 MY 2018 standards. As 
noted above, EISA requires that NHTSA provide four full model years of 
regulatory lead time and three full model years of regulatory stability 
for its fuel economy standards. See 49 U.S.C. 32902(k)(3).
    Congress has not spoken directly to the meaning of the words 
''regulatory stability.'' NHTSA believes that the ''regulatory 
stability'' requirement exists to ensure that manufacturers will not be 
subject to new standards in repeated rulemakings too rapidly, given 
that Congress did not include a minimum duration period for the MD/HD 
standards.\465\ NHTSA further believes that standards, which as set 
provide for increasing stringency during the period that the standards 
are applicable under this rule to be the maximum feasible during the 
regulatory period, are within the meaning of the statute. In this 
statutory context, NHTSA interprets the phrase ``regulatory stability'' 
in Section 32902(k)(3)(B) as requiring that the standards remain in 
effect for three years before they may be increased by amendment. It 
does not prohibit standards which contain predetermined stringency 
increases.''
---------------------------------------------------------------------------

    \465\ In contrast, light-duty standards must remain in place for 
``at least 1, but not more than 5, model years.'' 49 U.S.C. 
32902(b)(3)(B).
---------------------------------------------------------------------------

    Consistent with these authorities, the agencies are adopting more 
stringent standards beginning with MY 2021, and ending with MY 2027, 
that consider the level of technology we judge can be applied to new 
vehicles at reasonable cost to meet the standards. EPA believes the 
Phase 2 standards are consistent with CAA requirements regarding lead-
time, cost, feasibility, and safety. NHTSA believes the Phase 2 
standards are the maximum feasible under EISA. Manufacturers in the HD 
pickup and van market segment have relatively few vehicle lines and 
redesign cycles are typically longer compared to light-duty vehicles. 
Also, the timing of vehicle

[[Page 73736]]

redesigns differs among manufacturers. To provide lead time needed to 
accommodate these longer redesign cycles, the Phase 2 GHG standards 
will not reach their highest stringency until 2027. Although these 
standards will become more stringent each year between MYs 2021 and 
2027, the agencies expect manufacturers will likely make improvements 
as part of planned redesigns, such that some model years will likely 
involve significant advances, while other model years will likely 
involve little change. The agencies also expect manufacturers to use 
program flexibilities (e.g., credit carry-forward provisions and 
averaging and banking provisions) to help achieve compliance without 
compressing redesign schedules and to efficiently manage resources and 
capital over time. The MY 2018 standards are unchanged in MYs 2019-2020 
to provide necessary lead time for the Phase 2 standards. However, some 
manufacturers may choose to begin implementing technologies earlier (in 
some cases potentially as soon as MY 2017) depending on their vehicle 
redesign cycles. Although standards are not changing in MYs 2019-2020, 
manufacturers may introduce additional technologies in order to earn 
credits that may be carried-forward under the 5 year credit carry-
forward provisions established in Phase 1 and continuing for Phase 2.
    The agencies received several comments on the Phase 2 standards and 
the technological basis and feasibility of the standards. The comments 
are discussed in Sections VI.D and 0below, which provide additional 
discussion of vehicle redesign cycles and the feasibility of the final 
Phase 2 standards, and also in Section 7 of the Response to Comments 
document.
    Recognizing that it is unlikely that there is a phase-in approach 
that equally fits with all manufacturers' unique product redesign 
schedules, the agencies requested comments on other ways the Phase 2 
standards could be phased in. The agencies suggested one alternative 
approach would be to phase in the standards in a few step changes, for 
example in MYs 2021, 2024 and 2027 (as with the standards for 
vocational vehicles, tractors, trailers, and the heavy duty engine 
standards). Under this example, if the step changes on the order of 5 
percent, 10 percent, and 16 percent improvements from the MY 2020 
baseline in MYs 2021, 2024 and 2027 respectively, the program would 
provide CO2 reductions and fuel improvements roughly 
equivalent to the approach being adopted. EPA did not receive comments 
on this alternative phase-in approach, which closely resembles the 
phase-in approach used for the other sectors.
    AAPC commented in support of an alternative year-over-year phase-in 
that would phase-in stringency more gradually than proposed (and now 
adopted). AAPC recommended that rather than a 2.5 percent per year 
improvement, the increase should be at 1.75 percent per year through MY 
2024 and then 3.5 percent per year for MY 2025 through 2027 with the MY 
2027 level of stringency equally the proposed level. AAPC commented 
that this more gradual approach was consistent with the Phase 1 phase-
in approach and would help manufacturers manage the long lead time 
associated with developing the new vehicles and powertrains that will 
be required in order to comply with the Phase 2 proposal.
    The agencies are finalizing the proposed phase-in rather than 
adopting the approach recommended by AAPC. The more gradual phase-in 
recommended by AAPC would result in a loss of program benefits in each 
of the interim years of the program compared to the promulgated 
standards until the phase-in caught up with that phase-in in MY 2027. 
Because of the slower phase-in, the overall reduction in each interim 
year is lower than the phase-in being finalized. The phase-in adopted 
for Phase 1 with a more gradual ramp-up in standards took into 
consideration the shorter lead time associated with the Phase 1 
standards and the uncertainty associated with implementing a new 
program. Phase 2 provides more lead-time than Phase 1 and the agencies 
believe based on their analyses of the standards that the lead-time 
provided is sufficient, particularly considering the flexibility also 
provided by credit carry-forward and carry-back provisions.
    As with Phase 1 (and like the light-duty vehicle standards), the 
Phase 2 standards must be met on a production-weighted fleet average 
basis. No individual vehicle will have to meet a particular target (or 
the individual fleet average level). Each manufacturer will also have 
its own fleet average standard. Specifically, each manufacturer will 
have its own unique fleet average requirement based on the production-
weighted average of the heavy duty pickups and vans it chooses to 
produce. Moreover, averaging, banking, and trading provisions, just 
alluded to and discussed further below, will provide significant 
additional compliance flexibility in implementing the standards. It is 
important to note, however, that while the standards will differ 
numerically from manufacturer to manufacturer, effective stringency 
should be essentially the same for each manufacturer. The agencies did 
not receive comments suggesting changes to this general averaging 
approach to establishing the standards.
    Also, as with the Phase 1 standards, the agencies proposed and are 
finalizing separate Phase 2 targets for gasoline-fueled (and any other 
Otto-cycle) vehicles and diesel-fueled (and any other diesel-cycle) 
vehicles. See 80 FR 40337. The targets will be used to determine the 
production-weighted fleet average standards that apply to the combined 
diesel and gasoline fleet of HD pickups and vans produced by a 
manufacturer in each model year. The stringency increase discussed 
above for Phase 2 applies equally to the separate gasoline and diesel 
targets. For the proposal, the agencies considered different rates of 
increase for the gasoline and diesel targets in order to more equally 
balance compliance burdens across manufacturers with varying gasoline/
diesel fleet mixes. However, at least among major HD pickup and van 
manufacturers, our analyses suggested limited potential for such 
optimization, especially considering uncertainties involved with 
manufacturers' future fleet mix. The agencies did not receive comments 
on the specific topic of maintaining equivalent rates of increase for 
gasoline and diesel-fueled vehicles. The agencies, however, received 
several comments regarding maintaining separate standards for the two 
vehicle types. Some of the comments recommended closing the gap between 
diesel and gasoline-fueled vehicles by making the gasoline-fueled 
vehicle standards more stringent. These comments are discussed below.

[[Page 73737]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.012

    Described mathematically, EPA's and NHTSA's target standards are 
defined by the following formulas:

EPA CO2 Target (g/mile) = [a x WF] + b
NHTSA Fuel Consumption Target (gallons/100 miles) = [c x WF] + d

Where:
WF = Work Factor = [0.75 x (Payload Capacity + xwd)] + [0.25 x 
Towing Capacity]
Payload Capacity = GVWR (lb.) - Curb Weight (lb.)
xwd = 500 lbs. if the vehicle is equipped with 4wd, otherwise equals 
0 lbs.
Towing Capacity = GCWR (lb.) - GVWR (lb.)
Coefficients a, b, c, and d are taken from TableVI-2.

[[Page 73738]]



                     TableVI-2--Phase 2 Coefficients for HD Pickup and Van Target Standards
----------------------------------------------------------------------------------------------------------------
                   Model year                            a               b               c               d
----------------------------------------------------------------------------------------------------------------
                                                 Diesel Vehicles
----------------------------------------------------------------------------------------------------------------
2018-2020 \ a\..................................          0.0416             320       0.0004086           3.143
2021............................................          0.0406             312       0.0003988           3.065
2022............................................          0.0395             304       0.0003880           2.986
2023............................................          0.0386             297       0.0003792           2.917
2024............................................          0.0376             289       0.0003694           2.839
2025............................................          0.0367             282       0.0003605           2.770
2026............................................          0.0357             275       0.0003507           2.701
2027 and later..................................          0.0348             268       0.0003418           2.633
----------------------------------------------------------------------------------------------------------------
                                                Gasoline Vehicles
----------------------------------------------------------------------------------------------------------------
2018-2020 \ a\..................................           0.044             339       0.0004951           3.815
2021............................................          0.0429             331       0.0004827           3.725
2022............................................          0.0418             322       0.0004703           3.623
2023............................................          0.0408             314       0.0004591           3.533
2024............................................          0.0398             306       0.0004478           3.443
2025............................................          0.0388             299       0.0004366           3.364
2026............................................          0.0378             291       0.0004253           3.274
2027 and later..................................          0.0369             284       0.0004152           3.196
----------------------------------------------------------------------------------------------------------------
Note:
\a\ Phase 1 primary phase-in coefficients. Alternative phase-in coefficients are different in MY 2018 only.

    As noted above, the agencies did not propose and are not adopting 
changes from the final Phase 1 standards for MYs 2018-2020. The MYs 
2018-2020 standards are shown in the figures and tables above for 
reference. The agencies did not receive comments recommending changes 
to the standards in these model years.
    NHTSA and EPA have also analyzed regulatory alternatives to these 
standards, as discussed in Sections VI.D and 0and Section X. below. The 
agencies requested comment on all of the alternatives analyzed for the 
proposal, but requested comment on Alternative 4 in particular. The 
agencies did not propose Alternative 4 because EPA and NHTSA had 
outstanding questions regarding relative risks and benefits of 
Alternative 4 due to the timeframe envisioned by that alternative. As 
noted above, Alternative 4 would have provided less lead time for the 
complete phase-in of the Phase 2 standards based on an annual 
improvement of 3.5 percent per year in MYs 2021-2025 compared to the 
Alternative 3 per year improvement of 2.5 percent in MYs 2021-2027.
    In the proposal, the agencies requested comments, data, and 
information that would help inform determination of the maximum 
feasible (for NHTSA) and appropriate (for EPA) stringency for HD 
pickups and vans and are particularly interested in information and 
data related to the expected adoption rates of different emerging 
technologies, such as mild and strong hybridization. The agencies 
received comments both in support of and not in support of Alternative 
4 and also received comments in support of standards more stringent 
than either the proposal or the Alternative 4 pull ahead. The comments 
regarding stringency and feasibility are discussed in Sections VI.D and 
E. As described in these sections, and in Section X and RIA Chapter 11, 
NHTSA and EPA believe the final Phase 2 standards represent, 
respectively, the maximum feasible standards under EISA and the most 
stringent standards reasonably achievable under the CAA considering 
lead-time, reasonable cost, feasibility, and safety.
    As with Phase 1 standards, to calculate a manufacturer's HD pickup 
and van fleet average standard, the agencies proposed and are 
finalizing separate target curves for gasoline and diesel vehicles in 
Phase 2. While diesel and gasoline vehicles have separate work factor-
based target standard curves, all of a manufacturer's vehicles are 
averaged together as a single averaging set to demonstrate compliance. 
As noted above, the agencies' Phase 2 standards are estimated to result 
in approximately 16 percent reductions in CO2 and fuel 
consumption for both diesel and gasoline vehicles relative to the MY 
2018 Phase 1 standards for HD pickup trucks and vans.
    The agencies requested comment on both the level of stringency of 
the standards and the continued separate targets for gasoline and 
diesel HD pickups and vans. AAPC supported the agencies' proposal to 
maintain separate targets noting that the approach ensures that 
manufacturers of either engine type will implement the latest 
CO2 reducing technologies. AAPC further commented that 
significant technological and market-based differences exist between 
heavy-duty gasoline and heavy-duty diesel engines. According to the 
commenter, maintaining separate but comparably stringent spark ignition 
and compression ignition targets will allow customers for specific 
applications to take advantage of the combustion technology that best 
meets their specific application requirements.
    Several commenters did not support the proposed approach but 
instead supported setting a single fuel-neutral set of targets. Cummins 
commented that there is sufficient lead-time and technology to create a 
pathway to fuel-neutral targets, and that fuel neutral targets would 
eliminate any competitive advantage or preference to a particular GHG/
FE technology and maintain the environmental benefits envisioned for 
the program. Daimler, Honeywell, and MEMA similarly commented in 
support of fuel-neutral standards. Honeywell and Motor and Equipment 
Manufacturers Association (MEMA) suggested basing the standards on a 16 
percent improvement from the projected MY 2018 gasoline/diesel combined 
baseline. ACEEE and ICCT commented in support of a single set of 
standards set at or close to the capabilities of diesel technology. 
These commenters suggested that gasoline engines should be subject to 
more stringent standards than proposed and that gasoline and diesel 
engines should be held to the same performance-based standards.

[[Page 73739]]

    Bosch disagreed with maintaining separate targets for gasoline and 
diesel HD pickups and vans. Bosch recommended that targets be fuel 
neutral, as they are in the light-duty vehicle programs. Bosch 
commented that it ``believes that a market shift towards spark-ignited 
vehicles and away from HD pickups and vans powered by ``fundamentally 
more efficient'' CI engines would be a very real possibility under 
Phase 2 if the separate gasoline and diesel targets are finalized as 
proposed.'' Bosch continues that ``any such shift would signify not 
only a move towards less efficient internal combustion engines, but 
would be counterproductive from a programmatic/environmental and energy 
standpoint.'' Bosch further commented that ``diesels from a criteria 
pollutant (especially NOX emissions perspective, have made 
far greater strides over the years than gasoline engines, and for that 
reason have incurred greater technological development costs than the 
latter. While equivalent CO2 target values may be more 
expensive, comparatively speaking, for SI engines to achieve (based on 
the agencies' cost analysis), the additional cost imposed on these 
engines likely would not rise to the level of, much less overtake CI 
engines' historically higher technological development and system 
costs.''
    The agencies generally prefer to set standards that do not 
distinguish between fuel types where technological or market-based 
reasons do not strongly argue otherwise. However, as with Phase 1, we 
continue to believe that fundamental differences between spark ignition 
and compression ignition engines warrant unique fuel standards, which 
is also important in ensuring that our program maintains product 
choices available to vehicle buyers. In fact, gasoline and diesel fuel 
behave so differently in the internal combustion engine that they have 
historically required unique test procedures, emission control 
technologies and emission standards. These technological differences 
between gasoline and diesel engines for GHGs and fuel consumption exist 
presently and will continue to exist after Phase 1 and through Phase 2 
until advanced research evolves the gasoline fueled engine to diesel-
like efficiencies. This will require significant technological 
breakthroughs currently in early stages of research such as homogeneous 
charge compression ignition (HCCI) or similar concepts. Because these 
technologies are still in the early research stages, we believe the 
separate fuel type standards are appropriate in the timeframe of this 
rule to assure the availability of both gasoline and diesel engines. We 
also project that these separate standards will result in roughly 
equivalent redesign burdens for engines of both fuel types as evidenced 
by feasibility and cost analysis in RIA Chapter 10. For the same 
reasons, the agencies are adopting separate standards for diesel and SI 
vocational engines. See Section V. above.
    In order to maintain the same overall level of stringency as 
proposed for the program, a fuel neutral standard would result in an 
increase in stringency for gasoline or spark ignition vehicles with a 
matching relaxation of stringency for diesel or compression ignition 
vehicles relative to the separate numerical levels established in the 
proposal for gasoline and diesel vehicles. Based on the analysis of 
available technologies for both types of vehicles, the agencies do not 
feel it is appropriate to adopt such a change for either gasoline or 
diesel vehicles. This change could lead to an undesirable reduction in 
penetration of fuel efficient technologies in diesels, particularly 
from manufacturers who produce predominately diesel vehicles, while 
requiring a higher penetration of advanced technologies like strong 
hybridization in gasoline vehicles, distorting consumer choice. 
Additionally, the agencies do not agree with the comment stating that 
maintaining separate gasoline and diesel targets of equal increases in 
stringency of 2.5 percent per year from the Phase 1 final standards 
will result in a shift to less efficient gasoline vehicles. The 
agencies determined that manufacturers have similar technology 
challenges and corresponding costs regardless of fuel type and 
therefore manufacturers do not have an easier or lower cost long term 
path to compliance by simply shifting production from one fuel type to 
the other.
    Note further that a manufacturer's fleet average standard is the 
production weighted average of all its targets, both gasoline and 
diesel. Thus, there is no separate gasoline vehicle standard, or 
separate diesel standard. Commenters may have been confused on this 
point (several of the commenters referred to gasoline `standards', or 
diesel `standards'). This averaging feature of the standard further 
increases incentives to add advanced technologies to either gasoline or 
diesel vehicles if manufacturers perceive it advantageous to do so, 
since the benefit is experienced fleet wide, not just for the gasoline 
or diesel segment of a manufacturer's production line.
    The NHTSA fuel consumption target curves and EPA GHG target curves 
are equivalent. The agencies established the target curves using the 
direct relationship between fuel consumption and CO2 using 
conversion factors of 8,887 g CO2/gallon for gasoline and 
10,180 g CO2/gallon for diesel fuel.
    It is expected that measured performance values for CO2 
will generally be equivalent to fuel consumption. However, Phase 1 
established a provision that EPA is not changing for Phase 2 that 
allows manufacturers, if they choose, to use CO2 credits to 
help demonstrate compliance with N2O and CH4 
emissions standards, by expressing any N2O and 
CH4 under compliance in terms of their CO2-
equivalent and applying CO2 credits as needed. For test 
families that do not use this compliance alternative, the measured 
performance values for CO2 and fuel consumption will be 
equivalent because the same test runs and measurement data will be used 
to determine both values, and calculated fuel consumption will be based 
on the same conversion factors that are used to establish the 
relationship between the CO2 and fuel consumption target 
curves (8,887 g CO2/gallon for gasoline and 10,180 g 
CO2/gallon for diesel fuel). For manufacturers that choose 
to use EPA provision for CO2 credit use in demonstrating 
N2O and CH4 compliance, compliance with the 
CO2 standard will not be directly equivalent to compliance 
with the NHTSA fuel consumption standard.
(2) What are the HD pickup and van test cycles and procedures?
    The Phase 1 program established testing procedures for HD pickups 
and vans and NHTSA and EPA are maintaining these testing protocols. The 
vehicles will continue to be tested using the same heavy-duty chassis 
test procedures currently used by EPA for measuring criteria pollutant 
emissions from these vehicles, including the city fuel economy test 
cycle (FTP) and the highway fuel economy test cycle (HFET). These test 
procedures are used by manufacturers for certification and emissions 
compliance demonstrations and by the agencies for compliance 
verification and enforcement. While the FTP and the HFET driving 
patterns are identical to that of the light-duty test cycles, other 
test parameters for running them, such as test vehicle loaded weight, 
are specific to complete heavy-duty vehicles. Please see Section II.C 
(2) of the Phase 1 Preamble (76 FR 57166) for a discussion of how HD 
pickups and vans are tested.

[[Page 73740]]

    The test procedures for HD pickups and vans currently specify using 
a fuel with properties established under the light-duty (LD) vehicle 
Tier 2 program. EPA recently finalized new emission standards under the 
Tier 3 program for both LD vehicles and HD pickups and vans which will 
begin to phase-in in MY 2017 for LD vehicles and MY 2018 for vehicles 
over 6000 pounds GVWR, including HD pickups and vans. As part of the 
Tier 3 program, new test procedures for gasoline-fueled vehicles 
requiring the use of a new test fuel containing 10 percent ethanol 
which is more representative of in-use fuel that the vehicles will 
encounter. The agencies are investigating any potential impact of 
changes to the fuel properties on GHG emissions and fuel consumption 
and have committed to providing appropriate adjustment to the test 
procedures if necessary to ensure no change in stringency of the Phase 
1 or the Phase 2 standards.
    AAPC commented that the current methodology of grouping vehicles by 
the Equivalent Test Weight (ETW) in increments of 500 pounds for 
determining their GHG and FE performance is too large to capture weight 
reductions that may occur within a 500 pound grouping. Under the 
current test procedures, vehicles are tested at 500 lb. increments of 
inertial weight classes when testing at or above 5500 lbs. test weight. 
For example, the commenter stated that all vehicles having a calculated 
test weight basis of 11,251 to 11,750 lbs. are tested at 11,500 lbs. 
(i.e., the midpoint of the range). However, for some vehicles, the 
existence of these bins and the large intervals between bins may reduce 
or eliminate the incentive for mass reduction for some vehicles, as a 
vehicle may require significant mass reduction before it could switch 
from one test weight bin to the next lower bin. For other vehicles, 
these bins may unduly reward relatively small reductions of vehicle 
mass, as a vehicle's mass may be only slightly greater than that needed 
to be assigned a 500-pound lighter inertia weight class. For example, 
for a vehicle with a calculated test weight basis of 11,700 lbs., a 
manufacturer would receive no regulatory benefit for reducing the 
vehicle weight by 400 lbs., because the vehicle would stay within the 
same weight bracket.
    The agencies believe this (and similar comments) have some merit. 
In response, the agencies are finalizing an option allowing 
manufacturers to divide vehicle models into finer weight groupings of 
vehicles for the different Adjusted Loaded Vehicle Weights (ALVW) for 
purposes of more precise calculation of CO2 emissions 
performance within the 500 pound increment test weight classes. 
Manufacturers will be able to select 50, 100, 250, or 500 weight groups 
for reporting emissions. ALVW will vary within a single ETW largely 
depending on the varying models curb weights from customer option 
selection and other production variations. The calculation of 
CO2 emissions performance for the finer groupings is 
performed as described in 40 CFR 86.1819-14(g))) for analytically 
adjusting CO2 (ADCO2) emissions. The test results 
at the existing 500 pound increment ETWs will be used to determine the 
CO2 emissions performance level of the new groupings using 
the analytically derived equation. This new ADCO2 emissions 
level is only used for this new grouping and cannot be used to extend 
determination of other ALVW groupings emission performance levels. The 
vehicle specific values used to determine the change in ETW in the 
ADCO2 emissions calculation to estimate the performance of 
the smaller grouping should be consistent with value used to calculate 
the single work factor of that same grouping. This change does not 
impact the ETW of a group of vehicle models that are contained in the 
500 pound increment of ETW when performing testing nor does it 
eliminate any vehicle in that grouping from being responsible for 
emission performance at the 500 pound increment test weight classes. As 
described, this change only allows for more precise CO2 
emissions estimation for the potentially different curb weights of 
vehicles grouped in a single ETW class for purposes of fleet average 
calculation. If a manufacturer chooses to use less than 500 pound 
increments, they are required to use this option for all of their HD 
vehicles that are chassis certified (including loose engines).
(3) Fleet Average Standards
    As proposed, and as noted above, NHTSA and EPA are retaining the 
fleet average standards approach finalized in the Phase 1 rule and 
structurally similar to light-duty Corporate Average Fuel Economy 
(CAFE) and GHG standards. The fleet average standard for a manufacturer 
is a production-weighted average of the work factor-based targets 
assigned to unique vehicle configurations within each model type 
produced by the manufacturer in a model year, with separate targets for 
gasoline and diesel vehicles (which are then combined into a production 
weighted average which comprises that manufacturer's fleet average 
standard). Each manufacturer will continue to have an average GHG 
requirement and an average fuel consumption requirement unique to its 
new HD pickup and van fleet in each model year, depending on the 
characteristics (payload, towing, and drive type, as well as gasoline 
and diesel) of the vehicle models produced by that manufacturer, and on 
the U.S.-directed production volume of each of those models in that 
model year. Vehicle models with larger payload/towing capacities and/or 
four-wheel drive have individual targets at numerically higher 
CO2 and fuel consumption levels than less capable vehicles, 
as discussed in Section VI.B.(1). The agencies did not receive comments 
suggesting changes to this fundamental approach to the standards.
    The fleet average standard with which the manufacturer must comply 
will continue to be based on its final production figures for the model 
year, and thus a final assessment of compliance will occur after 
production for the model year ends. The assessment of compliance also 
must consider the manufacturer's use of carry-forward and carry-back 
credit provisions included in the averaging, banking, and trading 
program. Because compliance with the fleet average standards depends on 
actual test group production volumes, it is not possible to determine 
compliance at the time the manufacturer applies for and receives an 
(initial) EPA certificate of conformity for a test group. Instead, at 
certification the manufacturer will demonstrate a level of performance 
for vehicles in the test group, and make a good faith demonstration 
that its fleet, regrouped by unique vehicle configurations within each 
model type, is expected to comply with its fleet average standard when 
the model year is over. EPA will issue a certificate for the vehicles 
covered by the test group based on this demonstration, and will include 
a condition in the certificate that if the manufacturer does not comply 
with the fleet average, then production vehicles from that test group 
will be treated as not covered by the certificate to the extent needed 
to bring the manufacturer's fleet average into compliance. As in the 
parallel program for light-duty vehicles, additional ``model type'' 
testing will be conducted by the manufacturer over the course of the 
model year to supplement the initial test group data. The emissions and 
fuel consumption levels of the test vehicles will be used to calculate 
the production-weighted fleet averages for the manufacturer, after 
application of the appropriate deterioration factor to each result to 
obtain a full useful life value.

[[Page 73741]]

Please see Section II.C.(3)(a) of the Phase 1 Preamble (76 FR 57167) 
for further discussion of the fleet average approach for HD pickups and 
vans.
(4) In-Use Standards
    Section 202(a)(1) of the CAA specifies that EPA set emissions 
standards that are applicable for the useful life of the vehicle. EPA 
will continue the in-use standards approach for individual vehicles 
that EPA finalized for the Phase 1 program. NHTSA did not adopt Phase 1 
in-use standards and did not propose in-use standards for Phase 2. For 
the EPA program, compliance with the in-use standard for individual 
vehicles and vehicle models does not impact compliance with the fleet 
average standard, which will be based on the production-weighted 
average of the new vehicles. Vehicles that fail to meet their in-use 
emission standards will be subject to recall to correct the 
noncompliance. NHTSA is finalizing the use of EPA's useful life 
requirements to ensure manufacturers consider in the design process the 
need for fuel efficiency standards to apply for the same duration and 
mileage as EPA standards. NHTSA will limit such penalties to situations 
in which it determined that the vehicle or engine manufacturer failed 
to comply with the standards.
    As with Phase 1, the in-use Phase 2 GHG standards for HD pickups 
and vans will be established by adding an adjustment factor to the full 
useful life emissions used to calculate the GHG fleet average. Each 
model's in-use CO2 standard will be the model-specific level 
used in calculating the fleet average, plus 10 percent. No adverse 
comments were received on this provision. Please see Section 
II.C.(3)(b) of the Phase 1 Preamble (76 FR 57167) for further 
discussion of in-use standards for HD pickups and vans. This provision, 
along with the continuation of the Phase 1 test procedures, eliminates 
that need for the agencies to include any additional compliance margin 
in our feasibility analysis.
    For Phase 1, EPA aligned the useful life for GHG emissions with the 
useful life that was in place for criteria pollutants: 11 years or 
120,000 miles, whichever occurs first (40 CFR 86.1805-04(a)). Since the 
Phase 1 rule was finalized, EPA updated the useful life for criteria 
pollutants as part of the Tier 3 rulemaking.\466\ The new useful life 
implemented for Tier 3 is 150,000 miles or 15 years, whichever occurs 
first. As proposed, the useful life for GHG emissions and fuel 
consumption will also be 150,000 miles/15 years starting in MY 2021 
when the Phase 2 standards begin so that the useful life remains 
aligned for GHG and criteria pollutant standards long term. The 
agencies did not receive adverse comments on this provision.
---------------------------------------------------------------------------

    \466\ 79 FR 23492, April 28, 2014 and 40 CFR 86.1805-17.
---------------------------------------------------------------------------

(5) Other GHG Standards for HD Pickups and Vans
    This section addresses greenhouse gases other than CO2. 
Note that since these are greenhouse gases not directly related to fuel 
consumption, NHTSA does not have equivalent standards.
(a) Nitrous Oxide (N2O) and Methane (CH4)
    In the Phase 1 rule, EPA established emission standards for HD 
pickups and vans for both nitrous oxide (N2O) and methane 
(CH4). Similar to the CO2 standard approach, the 
N2O and CH4 emission levels of a vehicle are 
based on a composite of the light-duty FTP and HFET cycles with the 
same 55 percent city weighting and 45 percent highway weighting. The 
N2O and CH4 standards were both set by EPA at 
0.05 g/mile. Unlike the CO2 standards, averaging between 
vehicles is not allowed. The standards are designed to prevent 
increases in N2O and CH4 emissions from current 
levels, i.e., a no-backsliding standard. EPA did not propose and is not 
adopting any changes the N2O or CH4 standards or 
related provisions established in the Phase 1 rule. Please see Phase 1 
Preamble Section II.E. (76 FR 57188-57193) for additional discussion of 
N2O and CH4 emissions and standards.
    Across both current gasoline- and diesel-fueled heavy-duty vehicle 
designs, emissions of CH4 and N2O are relatively 
low and the intent of the cap standards is to ensure that future 
vehicle technologies or fuels do not result in an increase in these 
emissions. Given the global warning potential (GWP) of CH4, 
the 0.05 g/mile cap standard is equivalent to about 1.7 g/mile 
CO2, which is much less than 1 percent of the overall GHG 
emissions of most HD pickups and vans.\467\ The effectiveness of 
oxidation of CH4 using a three-way or diesel oxidation 
catalyst is limited by the activation energy, which tends to be higher 
where the number of carbon atoms in the hydrocarbon molecule is low and 
thus CH4 is very stable. At this time we are not aware of 
any technologies beyond the already present catalyst systems which are 
highly effective at oxidizing most hydrocarbon species for gasoline and 
diesel fueled engines that would further lower the activation energy 
across the catalyst or increase the energy content of the exhaust 
(without further increasing fuel consumption and CO2 
emissions) to further reduce CH4 emissions at the tailpipe. 
The CH4 standard remains an important backstop to prevent 
future increases in CH4 emissions. EPA did not receive 
adverse comments regarding the proposal to not change the 
CH4 standard for HD pickups and vans.
---------------------------------------------------------------------------

    \467\ N2O has a GWP of 298 and CH4 has a 
GWP of 34 according to the IPCC AR5.
---------------------------------------------------------------------------

    N2O is emitted from gasoline and diesel vehicles mainly 
during specific catalyst temperature conditions conducive to 
N2O formation. The 0.05 g/mile standard, which translates to 
a CO2-equivalent value of 14.9 g/mile, ensures that systems 
are not designed in a way that emphasizes efficient NOX 
control while allowing the formation of significant quantities of 
N2O. The Phase 1 N2O standard of 0.05 g/mile for 
pickups and vans was finalized knowing that it is more stringent than 
the Phase 1 N2O engine standard of 0.10 g/hp-hr, which is 
being continued for Phase 2, as discussed in Section II.D.3. EPA 
continues to believe that the 0.05 g/mile standard provides the 
necessary assurance that N2O will not significantly 
increase, given the mix of gasoline and diesel fueled engines in this 
market and the upcoming implementation of the light-duty and heavy-duty 
(up to 14,000 lbs. GVWR) Tier 3 NOX standards. EPA knows of 
no technologies that would lower N2O emissions beyond the 
control provided by the precise emissions control systems already being 
implemented to meet EPA's criteria pollutant standards. Therefore, EPA 
continues to believe the 0.05 g/mile N2O standard remains 
appropriate.
    The California Air Resources Board (CARB) suggested that EPA 
investigate the feasibility of more stringent tailpipe standards. EPA 
may consider more stringent standards in the future if data is 
available to support adjustments to the standards as appropriate and 
consistent with the CAA, but we repeat that at present we know of no 
further emission reduction technologies for either N2O or 
CH4.
    If a manufacturer is unable to meet the N2O or 
CH4 cap standards, the EPA program allows the manufacturer 
to comply using CO2 credits. In other words, a manufacturer 
may offset any N2O or CH4 emissions above the 
standard by taking steps to further reduce CO2. A 
manufacturer choosing this option would use GWPs to convert its 
measured N2O and CH4 test results that are in 
excess of the applicable

[[Page 73742]]

standards into CO2eq to determine the amount of 
CO2 credits required. For example, for Phase 1, a 
manufacturer would use 25 Mg of positive CO2 credits to 
offset 1 Mg of negative CH4 credits or use 298 Mg of 
positive CO2 credits to offset 1 Mg of negative 
N2O credits.\468\ By using the GWP of N2O and 
CH4, the approach recognizes the inter-correlation of these 
compounds in impacting global warming and is environmentally neutral 
for demonstrating compliance with the individual emissions caps. 
Because fuel conversion manufacturers certifying under 40 CFR part 85, 
subpart F, do not participate in ABT programs, EPA included in the 
Phase 1 rule a compliance option for fuel conversion manufacturers to 
comply with the N2O and CH4 standards that is 
similar to the credit program described above. See 76 FR 57192. The 
compliance option will allow conversion manufacturers, on an individual 
engine family basis, to convert CO2 over compliance into 
CO2 equivalents (CO2 eq) of N2O and/or 
CH4 that can be subtracted from the CH4 and 
N2O measured values to demonstrate compliance with 
CH4 and/or N2O standards. EPA did not include 
similar provisions allowing over compliance with the N2O or 
CH4 standards to serve as a means to generate CO2 
credits because the CH4 and N2O standards are cap 
standards representing levels that all but the worst vehicles should 
already be well below. Allowing credit generation against such cap 
standard would provide a windfall credit without any true GHG 
reduction. As proposed, EPA is maintaining these provisions for Phase 2 
as they provide important flexibility without reducing the overall GHG 
benefits of the program.
---------------------------------------------------------------------------

    \468\ IPCC AR4 included a N2O GWP of 298 and a 
CH4 GWP of 25. These factors are used in the Phase 1 rule 
credits calculations.
---------------------------------------------------------------------------

    EPA requested comments on updating GWPs used in the calculation of 
credits discussed above. For Phase 2, EPA is updating the GWP for 
methane from 25 to 34 based on IPCC AR5. Please see the full discussion 
of this issue provided in Sections II.D and XI.D.
    CARB suggested that EPA consider eliminating or at least phasing 
out the use of CO2 credits in lieu of compliance with 
tailpipe methane standards. In contrast, NGVAmerica strongly supported 
extending this compliance option, noting that the ability to offset 
methane (and also nitrous oxide) emissions with CO2 credits 
is critical for new natural gas engines and vehicles. Cummins also 
commented in support of continuing to allow the use of CO2-
equivalent credits to comply with N2O and CH4 standards. 
Cummins commented that the flexibility has been applied by various 
manufacturers in Phase 1 and is necessary for Phase 2. Review of MY 
2014 certification GHG data confirmed that several manufacturers 
utilized this Phase 1 program flexibility for either N2O or 
CH4 debits on their diesel vehicles. EPA continues to 
believe this flexibility is appropriate as it provides important 
flexibility to manufacturers in an environmentally neutral manner.

(b) Air Conditioning Related Emissions

    Air conditioning systems contribute to GHG emissions in two ways--
direct emissions through refrigerant leakage and indirect exhaust 
emissions due to the extra load on the vehicle's engine to provide 
power to the air conditioning system. HFC refrigerants, which are 
powerful GHG pollutants, can leak from the A/C system. This includes 
the direct leakage of refrigerant as well as the subsequent leakage 
associated with maintenance and servicing, and with disposal at the end 
of the vehicle's life.\469\ Currently, the most commonly used 
refrigerant in automotive applications--R134a, has a high GWP. Due to 
the high GWP of R134a, a small leakage of the refrigerant has a much 
greater global warming impact than a similar amount of emissions of 
CO2 or other mobile source GHGs.
---------------------------------------------------------------------------

    \469\ The U.S. EPA has reclamation requirements for refrigerants 
in place under Title VI of the Clean Air Act. See 40 CFR part 82 
Subpart B.
---------------------------------------------------------------------------

    In Phase 1, EPA finalized low leakage requirement for all air 
conditioning systems installed in 2014 model year and later HDVs, with 
the exception of Class 2b-8 vocational vehicles. As discussed in 
Section V.B.(2)(c), EPA is extending leakage standards to vocational 
vehicles for Phase 2. For air conditioning systems with a refrigerant 
capacity greater than 733 grams, EPA finalized a leakage standard which 
is a ``percent refrigerant leakage per year'' to assure that high-
quality, low-leakage components are used in each air conditioning 
system design. EPA finalized a standard of 1.50 percent leakage per 
year for heavy-duty pickup trucks and vans and Class 7 and 8 tractors. 
See Section II.E.5. of the Phase 1 Preamble (76 FR 57194-57195) for 
further discussion of the A/C leakage standard. The leakage standard 
continues to apply for Phase 2 regardless of the refrigerant used in 
the A/C system. See Section I.F. for how the Phase 2 program handles 
the use of alternative refrigerants.
    In addition to direct emissions from refrigerant leakage, air 
conditioning systems create indirect exhaust emissions due to the extra 
load on the vehicle's engine to provide power to the air conditioning 
system. These indirect emissions are in the form of the additional 
CO2 emitted from the engine when A/C is being used due to 
the added loads. Unlike direct emissions which tend to be a set annual 
leak rate not directly tied to usage, indirect emissions are fully a 
function of A/C usage. These indirect CO2 emissions are 
associated with air conditioner efficiency, since (as just noted) air 
conditioners create load on the engine. See 74 FR 49529. In Phase 1, 
the agencies did not set air conditioning efficiency standards for 
vocational vehicles, combination tractors, or heavy-duty pickup trucks 
and vans. The CO2 emissions due to air conditioning systems 
in these heavy-duty vehicles were estimated to be minimal compared to 
their overall emissions of CO2. 76 FR 57194-57196. This 
continues to be the case. For this reason, EPA did not propose and is 
not establishing A/C efficiency standards for Phase 2. This differs 
from light-duty vehicles where CO2 emissions related to A/C 
systems can be a significant portion of overall vehicle CO2 
emissions and EPA has established appropriate standards and test 
procedures.
    AAPC and Nissan commented that the agencies should provide A/C 
efficiency credits similar to those included in the light-duty vehicle 
program. AAPC also commented that the AC17 test, included in the light-
duty vehicle program to confirm A/C system performance, would be 
impractical and should not be required for heavy-duty vehicles. The 
agencies did not propose and are not adopting A/C efficiency credits 
for heavy-duty pickups and vans. AAPC suggests that the agencies could 
allow the same credits as are available in the light-duty vehicle 
program but no data is provided regarding the appropriateness of the 
credits. The EPA would need to resolve a number of open issues relating 
to environmental implications of A/C efficiency credits for these 
vehicles (among them, potential credit generation rate, whether credits 
would be windfall, implications for the standard stringency) before 
considering adopting an A/C efficiency credit regime. Also, the AC17 
test is an integral part of the light-duty vehicle program serving as a 
confirmation that the credits are based on actual performance 
improvements. EPA does not believe that it would be appropriate to 
provide credits based only on the presumption that systems similar to 
those used in light-duty trucks will

[[Page 73743]]

provide the same improvements in heavy-duty pickups and vans with no 
confirmation through testing.
    AAPC also recommended that EPA provide credits for reduced 
refrigerant leakage and alternative refrigerant usage similar to the 
light-duty vehicle program. In response, as discussed above and in 
Section I.F, EPA has established standards for refrigerant leakage. EPA 
does not believe that it would be appropriate to provide credits for 
items that are essentially required. Providing such credits without an 
increase in total program stringency similar to the light-duty approach 
to A/C efficiency and refrigerant leakage would result in a loss of 
program benefits.

C. Use of the CAFE Model in Heavy-Duty Rulemaking

    NHTSA developed the CAFE model in 2002 to support the 2003 issuance 
of CAFE standards for MYs 2005-2007 light trucks. NHTSA has since 
significantly expanded and refined the model, and has applied the model 
to support every ensuing CAFE rulemaking for both light-duty and heavy-
duty. For this analysis, the model was reconfigured to use the work 
based attribute metric of ``work factor'' established in the Phase 1 
rule instead of the light duty ``footprint'' attribute metric.
    Past analyses conducted using the CAFE model have been subjected to 
extensive and detailed review and comment, much of which has informed 
the model's expansion and refinement. NHTSA's use of the model was 
considered and supported in Center for Biological Diversity v. National 
Highway Traffic Safety Admin., 538 F.3d 1172, 1194 (9th Cir. 2008). For 
further discussion see 76 FR 57198, and the model has been subjected to 
formal peer review and review by the General Accounting Office (GAO) 
and National Research Council (NRC). NHTSA makes public the model, 
source code, and--except insofar as doing so will compromise 
confidential business information (CBI) manufacturers have provided to 
NHTSA--all model inputs and outputs underlying published rulemaking 
analyses.
    Although the CAFE model can also be used for more aggregated 
analysis (e.g., involving ``representative vehicles,'' single-year 
snapshots, etc.), NHTSA designed the model with a view toward (a) 
detailed simulation of manufacturers' potential actions given a defined 
set of standards, followed by (b) calculation of resultant impacts and 
economic costs and benefits. The model is intended to describe actions 
manufacturers could take in light of defined standards and other input 
assumptions and estimates, not to predict actions manufacturers will 
take in light of competing product and market interests (e.g. engine 
power, customer features, technology acceptance, etc.).
    For the proposal, the agencies conducted coordinated and 
complementary analyses using two analytical methods for the heavy-duty 
pickup and van segment by employing both NHTSA's CAFE model and EPA's 
MOVES model. The agencies used EPA's MOVES model to estimate fuel 
consumption and emissions impacts for tractor-trailers (including the 
engine that powers the tractor), and vocational vehicles (including the 
engine that powers the vehicle). Additional calculations were performed 
to determine corresponding monetized program costs and benefits. For 
heavy-duty pickups and vans, the agencies performed complementary 
analyses, which we refer to as ``Method A'' and ``Method B.''
    For the final rule, NHTSA's Method A uses a modified version of the 
CAFE model developed since the NPRM, as well as accompanying updates to 
CAFE model inputs, to project a pathway the industry could use to 
comply with each regulatory alternative and the estimated effects on 
fuel consumption, emissions, benefits and costs were industry to do so. 
Method A is presented below in Section D and differs from the Method A 
analysis provided in the NPRM. NHTSA considered the results of the 
Method A analysis for decision making for the final rule.
    EPA's Method B analysis continues to use the CAFE model and inputs 
developed for the NPRM to identify technology pathways the industry 
could potentially use to comply with each regulatory alternative, along 
with resultant impacts on per vehicle costs should that compliance path 
be utilized, and the MOVES model was used to calculate corresponding 
changes in total fuel consumption and annual emissions. The results are 
presented in Section E. Additional calculations were performed to 
determine corresponding monetized program costs and benefits. NHTSA's 
consideration of the Method A analysis and EPA's consideration of the 
Method B analysis led the agencies to the same conclusions regarding 
the selection of the Phase 2 standards. See Sections D and E for 
additional discussion of these two methods and the feasibility of the 
standards.
(1) Overview of the CAFE Model
    As a starting point, the model makes use of an input file defining 
the analysis fleet--that is, a set of specific vehicle models (e.g., 
Ford F250) and model configurations (e.g., Ford F250 with 6.2-liter V8 
engine, 4WD, and 6-speed manual transmission) estimated or assumed to 
be produced by each manufacturer in each model year to be included in 
the analysis. The analysis fleet includes key engineering attributes 
(e.g., curb weight, payload and towing capacities, dimensions, presence 
of various fuel-saving technologies) of each vehicle model, engine, and 
transmissions, along with estimates or assumptions of future production 
volumes. It also specifies the extent to which specific vehicle models 
share engines, transmissions, and vehicle platforms, and describes each 
manufacturer's estimated or assumed product cadence (i.e., timing for 
freshening and redesigning different vehicles and platforms). This 
input file also specifies a payback period used to estimate the 
potential that each manufacturer might apply technology to improve fuel 
economy beyond levels required by standards.
    A second input file to the model contains a variety of contextual 
estimates and assumptions. Some of these inputs, such as future fuel 
prices and vehicle survival and mileage accumulation (versus vehicle 
age), are relevant to estimating manufacturers' potential application 
of fuel-saving technologies. Some others, such as fuel density and 
carbon content, vehicular and upstream emission factors, the social 
cost of carbon dioxide emissions, and the discount rate, are relevant 
to calculating physical and economic impacts of manufacturers' 
application of fuel-saving technologies.
    A third input file contains estimates and assumptions regarding the 
future applicability, availability, efficacy, and cost of various fuel-
saving technologies. Efficacy is expressed in terms of the percentage 
reduction in fuel consumption, cost is expressed in dollars, and both 
efficacy and cost are expressed on an incremental basis (i.e., 
estimates for more advanced technologies are specified as increments 
beyond less advanced technologies). The input file also includes 
``synergy factors'' used to make adjustments accounting for the 
potential that some combinations of technologies may result fuel 
savings or costs different from those indicated by incremental values. 
Thus, the model itself does not evaluate which technologies will be 
available, nor does it evaluate how effective or reliable they

[[Page 73744]]

will be. The technological availability and effectiveness are rather 
predefined inputs to the model based on the agencies' judgements and 
not outputs from the model, which is simply a tool for calculating the 
effects of combining input assumptions.
    Finally, a fourth model input file specifies standards to be 
evaluated. Standards are defined on a year-by-year basis separately for 
each regulatory class (passenger cars, light trucks, and heavy-duty 
pickups and vans). Regulatory alternatives are specified as discrete 
scenarios, with one scenario defining the no-action alternative or 
``baseline,'' all other scenarios defining regulatory alternatives to 
be evaluated relative to that no-action alternative.
    Given these inputs, the model estimates each manufacturer's 
potential year-by-year application of fuel-saving technologies to each 
engine, transmission, and vehicle. Subject to a range of engineering 
and planning-related constraints (e.g., secondary axle disconnect can't 
be applied to 2-wheel drive vehicles, many major technologies can only 
be applied practicably as part of a vehicle redesign, and applied 
technologies carry forward between model years), the model attempts to 
apply technology to each manufacturer's fleet in a manner that 
minimizes ``effective costs'' (accounting, in particular, for 
technology costs and avoided fuel outlays), continuing to add 
improvements as long as doing so will help toward compliance with 
specified standards or will produce fuel savings that ``pay back'' at 
least as quickly as specified in the input file mentioned above.
    After estimating the extent to which each manufacturer might add 
fuel-saving technologies under each specified regulatory alternative, 
the model calculates a range of physical impacts, such as changes in 
highway travel (i.e., VMT), changes in fleetwide fuel consumption, 
changes in highway fatalities, and changes in vehicular and upstream 
greenhouse gas and criteria pollutant emissions. The model also applies 
a variety of input estimates and assumptions to calculate economic 
costs and benefits to vehicle owners and society, based on these 
physical impacts. These are considered Method A results.
    Since the manufacturers of HD pickups and vans generally only have 
one basic pickup truck and van with different versions ((i.e., 
different wheelbases, cab sizes, two-wheel drive, four-wheel drive, 
etc.) there exists less flexibility than in the light-duty fleet to 
coordinate model improvements over several years. As such, the CAFE 
model allows changes to the HD pickups and vans to meet new standards 
according to estimated redesign cycles included as a model input. As 
noted above, the opportunities for large-scale changes (e.g., new 
engines, transmission, vehicle body and mass) thus occur less 
frequently than in the light-duty fleet, typically at spans of eight or 
more years for this analysis. However, opportunities for gradual 
improvements not necessarily linked to large scale changes can occur 
between the redesign cycles (i.e., model refresh). Examples of such 
improvements are upgrades to an existing vehicle model's engine, 
transmission and aftertreatment systems.
(2) How did the agencies develop the analysis fleet for the NPRM?
    As discussed above, both agencies used a version of NHTSA's CAFE 
modeling system to estimate technology costs and application rates 
under each regulatory alternative considered. The modeling system 
relies on many inputs, including an analysis fleet. In order to 
estimate the impacts of potential standards, it is necessary to 
estimate the composition of the future vehicle fleet. Doing so enables 
estimation of the extent to which each manufacturer may need to add 
technology in response to a given series of attribute-based standards, 
accounting for the mix and fuel consumption of vehicles in each 
manufacturer's regulated fleet. The agencies create an analysis fleet 
in order to track the volumes and types of fuel economy-improving and 
CO2-reducing technologies that are already present in the 
existing vehicle fleet. This aspect of the analysis fleet helps to keep 
the CAFE model from adding technologies to vehicles that already have 
these technologies, which will result in ``double counting'' of 
technologies' costs and benefits. An additional step involved 
projecting the fleet sales into MYs 2019-2030. This represents the 
fleet volumes that the agencies believe will exist in MYs 2019-2030. 
The following presents an overview of the information and methods 
applied to develop the analysis fleet, and some basic characteristics 
of that fleet.
    Most of the information about the vehicles that make up the 2014 
analysis fleet (used in the NPRM and Method B of this FRM) and the 2015 
analysis fleet (used in Method A of this FRM) was gathered from the 
2014 and 2015 Pre-Model Year Reports submitted to EPA by the 
manufacturers under Phase 1 of Fuel Efficiency and GHG Emission Program 
for Medium- and Heavy-Duty Trucks, MYs 2014-2018. The major 
manufacturers of class 2b and class 3 trucks (Chrysler, Ford and GM) 
were asked to voluntarily submit updates to their Pre-Model Year 
Reports. The agencies used these updated data in constructing the 
analysis fleet for these manufacturers. The agencies agreed to treat 
this information as Confidential Business Information (CBI) until the 
publication of the proposed rule. This information can be made public 
at this time because by now all MY 2014 and MY 2015 vehicle models have 
been produced, which makes data about them essentially public 
information.
    In addition to information about each vehicle, the agencies need 
additional information about the fuel economy-improving/CO2-
reducing technologies already on those vehicles in order to assess how 
much and which technologies to apply to determine a path toward future 
compliance. To correctly account for the cost and effectiveness of 
adding technologies, it is necessary to know the technology penetration 
in the existing vehicle fleet. Otherwise, ``double-counting'' of 
technology could occur. Thus, in their respective analysis fleets, the 
agencies augmented this information with data from public and 
commercial sources \470\ that include more complete technology 
descriptions, e.g. for specific engines and transmissions.
---------------------------------------------------------------------------

    \470\ e.g., manufacturers' Web sites, Wards Automotive.
---------------------------------------------------------------------------

    The resultant analysis fleets are provided in detail at NHTSA's Web 
site, along with all other inputs to and outputs from both the NPRM and 
the current analysis. The agencies invited but did not receive comment 
on this analysis.
(a) Vehicle Redesign Schedules and Platforms
    Product cadence in the Class 2b and 3 pickup market has 
historically ranged from 7-9 years between major redesigns. However, 
due to increasing competitive pressures and consumer demands the agency 
anticipates that manufacturers will generally shift to shorter design 
cycles resembling those of the light duty market. Pickup truck 
manufacturers in the Class 2b and 3 segments are shown to adopt 
redesign cycles of six years, allowing two redesigns prior to the end 
of the regulatory period in 2025.
    The Class 2b and 3 van market has changed markedly from five years 
ago. Ford, Nissan, Ram and Daimler have adopted vans of ``Euro Van'' 
appearance, and in many cases now use smaller turbocharged gasoline or 
diesel engines in the place of larger, naturally-aspirated V8s. The 
2014 and 2015 model years used in this analysis

[[Page 73745]]

represent a period where most manufacturers, with the exception of 
General Motors, have recently introduced a completely redesigned 
product after many years. The van segment has historically been one of 
the slowest to be redesigned of any product segment, with some products 
going two decades or more between redesigns.
    Due to new entrants in the field and increased competition, the 
agencies anticipate that most manufacturers will increase the pace of 
product redesigns in the van segment, but that they will continue to 
trail other segments. The cycle time used in this analysis is 
approximately ten years between major redesigns, allowing 
manufacturers' only one major redesign during the regulatory period. 
The agencies did not receive comment on this anticipated product design 
cycle.
    Additional detail on product cadence assumptions for specific 
manufacturers is located in Chapter 10 of the RIA.
(b) Sales Volume Forecast
    Since each manufacturer's required average fuel consumption and GHG 
levels are sales-weighted averages of the fuel economy/GHG targets 
across all model offerings, sales volumes play a critical role in 
estimating that burden. The CAFE model requires a forecast of sales 
volumes, at the vehicle model-variant level, in order to simulate the 
technology application necessary for a manufacturer to achieve 
compliance in each model year for which outcomes are simulated.
    As stated above, the agencies relied on the pre-model-year 
compliance submissions from manufacturers to provide sales volumes at 
the model level based on the level of disaggregation in which the 
models appear in the compliance data. However, the agencies only use 
these reported volumes without adjustment for the reference fleet model 
year (MY 2014 or MY 2015). For all future model years, we combine the 
manufacturer submissions with sales projections from the 2014 (for the 
NPRM and Method B of the FRM) or 2015 (for Method A of the FRM) Annual 
Energy Outlook Reference Case and IHS Automotive to determine model 
variant level sales volumes in future years.\471\ The projected sales 
volumes by class that appear in the Annual Energy Outlook as a result 
of a collection of assumptions about economic conditions, demand for 
commercial miles traveled, and technology migration from light-duty 
pickup trucks in response to the concurrent light-duty CAFE/GHG 
standards. These are shown in Chapter 2 of the RIA.
---------------------------------------------------------------------------

    \471\ Tables from AEO's forecast are available at http://www.eia.gov/oiaf/aeo/tablebrowser/. The agencies also made use of 
the IHS Automotive Light Vehicle Production Forecast (August 2014).
---------------------------------------------------------------------------

    The projection of total sales volumes for the Class 2b and 3 market 
segment was based on the total volumes in the 2014 AEO Reference Case 
in the NPRM and for Method B of this FRM. For the purposes of this 
analysis, the AEO2014 calendar year volumes have been used to represent 
the corresponding model-year volumes. While AEO2014 provides enough 
resolution in its projections to separate the volumes for the Class 2b 
and 3 segments, the agencies deferred to the vehicle manufacturers and 
chose to rely on the relative shares present in the pre-model-year 
compliance data. This methodology remains the same for the Method A FRM 
analysis, but we have replaced the 2014 AEO reference case with the 
2015 AEO reference case.
    The relative sales share by vehicle type (van or pickup truck, in 
this case) was derived from a sales forecast that the agencies 
purchased from IHS Automotive, and applied to the total volumes in the 
AEO2014 projection. Table VI-3 shows the implied shares of the total 
new 2b/3 vehicle market broken down by manufacturer and vehicle type. 
The same methodology was applied using 2015 IHS/Polk projections, and 
the total volumes from the AEO2015 projection for Method A of the FRM. 
The results of the 2015-based projections are presented in the 
following section about changes made to the model since the NPRM.

                                           Table VI-3--IHS Automotive Market Share Forecast for 2b/3 Vehicles
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                    Model year market share
              Manufacturer                           Style           -----------------------------------------------------------------------------------
                                                                       2015 (%)    2016 (%)    2017 (%)    2018 (%)    2019 (%)    2020 (%)    2021 (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Daimler.................................  Van.......................           3           3           3           3           3           3           3
Fiat Chrysler...........................  Van.......................           2           2           2           2           2           2           3
Ford....................................  Van.......................          16          17          17          17          18          18          18
General Motors..........................  Van.......................          12          12          11          12          13          13          13
Nissan..................................  Van.......................           2           2           2           2           2           2           2
Daimler.................................  Pickup....................           0           0           0           0           0           0           0
Fiat Chrysler...........................  Pickup....................          14          14          14          14          11          12          12
Ford....................................  Pickup....................          28          27          30          30          30          27          26
General Motors..........................  Pickup....................          23          23          21          21          21          22          23
Nissan..................................  Pickup....................           0           0           0           0           0           0           0
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Within those broadly defined market shares, volumes at the 
manufacturer/model-variant level were constructed by applying the 
model-variant's share of manufacturer sales in the pre-model-year 
compliance data for the relevant vehicle style, and multiplied by the 
total volume estimated for that manufacturer and that style.
    After building out a set of initial future sales volumes based on 
the sources described above, the agencies attempted to incorporate new 
information about changes in sales mix that are not captured by either 
the existing sales forecasts or the simulated technology changes in 
vehicle platforms. In particular, Ford has announced intentions to 
phase out their existing Econoline vans, gradually shifting volumes to 
the new Transit platform for some model variants (notably chassis cabs 
and cutaways variants) and eliminating offerings outright for complete 
Econoline vans as early as model year 2015. In the case of complete 
Econoline vans, the volumes for those vehicles were allocated to MY 
2015 Transit vehicles based on assumptions about likely production 
splits for the powertrains of the new Transit platform. The volumes for 
complete Econoline vans were shifted at ratios of 50 percent, 35 
percent, and 15

[[Page 73746]]

percent for 3.7 L, 3.5 L Eco-boost, and 3.2 L diesel, respectively. 
Within each powertrain, sales were allocated based on the percentage 
shares present in the pre-model-year compliance data. The chassis cab 
and cutaway variants of the Econolines were phased out linearly between 
MY 2015 and MY 2020, at which time the Econolines cease to exist in any 
form and all corresponding volume resides with the Transits.
(3) Other Analysis Inputs
    In addition to the inputs summarized above, the analysis of 
potential standards for HD pickups and vans makes use of a range of 
other estimates and assumptions specified as inputs to the CAFE 
modeling system. Some significant inputs (e.g., estimates of future 
fuel prices) also applicable to other MDHD segments are discussed below 
in Section IX. Others more specific to the analysis of HD pickups and 
vans are as follows:
(a) Vehicle Survival and Mileage Accumulation
    The analysis estimates the travel, fuel consumption, and emissions 
over the useful lives of vehicles produced during model years 2014-
2030. Doing so requires initial estimates of these vehicles' survival 
rates (i.e., shares expected to remain in service) and mileage 
accumulation rates (i.e., anticipated annual travel by vehicles 
remaining in service), both as a function of vehicle vintage (i.e., 
age). These estimates are based on an empirical analysis of changes in 
the fleet of registered vehicles over time from HIS/Polk data, in the 
case of survival rates. The NPRM and Method A of the FRM use data 
collected as part of the last Vehicle In Use Survey (the 2002 VIUS) for 
the mileage accumulation schedule. Method A of the FRM uses mileage 
accumulation schedules from 2014 Polk/IHS odometer reading data. The 
changes to the VMT schedules for Method A of the current analysis are 
further described below in the Method A FRM specific changes.
(b) Rebound Effect
    Expressed as an elasticity of mileage accumulation with respect to 
the fuel cost per mile of operation, the agencies have applied a 
rebound effect of 10 percent for today's analysis. Other rebound 
effects are considered in sensitivity analyses in Sections D.
(c) On-Road ``Gap''
    The model was run with a 20 percent adjustment to reflect 
differences between on-road and laboratory performance.
(d) Fleet Population Profile
    Though not reported here, cumulative fuel consumption and 
CO2 emissions are presented in the accompanying EIS, and 
these calculations utilize estimates of the numbers of vehicles 
produced in each model year remaining in service in calendar year 2014. 
The initial age distribution of the registered vehicle population in 
2014 is based on vehicle registration data acquired by NHTSA from R.L. 
Polk Company. For Method A, these values were updated to reflect newer 
data acquired by NHTSA from Polk.
(e) Past Fuel Consumption Levels
    Though not reported here, cumulative fuel consumption and 
CO2 emissions are presented in the accompanying EIS, and 
these calculations require estimates of the performance of vehicles 
produced prior to model year 2014. Consistent with AEO 2014, the model 
was run with the assumption that gasoline and diesel HD pickups and 
vans averaged 14.9 mpg and 18.6 mpg, respectively, with gasoline 
versions averaging about 48 percent of production. For Method A, these 
values were updated to reflect AEO2015, such that gasoline and diesel 
versions were projected to average 16.0 mpg and 20.0 mpg, respectively.
(f) Long-Term Fuel Consumption Levels
    Though not reported here, longer-term estimates of fuel consumption 
and emissions are presented in the accompanying EIS. These estimates 
include calculations involving vehicle produced after MY 2030 and, 
consistent with AEO 2014, the model was run with the assumption that 
fuel consumption and CO2 emission levels will continue to 
decline at 0.05 percent annually (compounded) after MY 2030.
(g) Payback Period
    To estimate in what sequence and to what degree manufacturers might 
add fuel-saving technologies to their respective fleets, the CAFE model 
iteratively ranks remaining opportunities (i.e., applications of 
specific technologies to specific vehicles) in terms of effective cost, 
primary components of which are the technology cost and the avoided 
fuel outlays, attempting to minimize effective costs incurred.\472\ 
Depending on inputs, the model also assumes manufacturers may improve 
fuel consumption beyond requirements insofar as doing so will involve 
applications of technology at negative effective cost--i.e., technology 
application for which buyers' up-front costs are quickly paid back 
through avoided fuel outlays. This calculation includes only fuel 
outlays occurring within a specified payback period. For both Method A 
and Method B, a payback period of 6 months was applied for the dynamic 
baseline case, or Alternative 1b. Thus, for example, a manufacturer 
already in compliance with standards is projected to apply a fuel 
consumption improvement projected to cost $250 (i.e., as a cost that 
could be charged to the buyer at normal profit to the manufacturer) and 
reduce fuel costs by $500 in the first year of vehicle operation. The 
agencies have conducted the same analysis applying a payback period of 
0 months for the flat baseline case, or Alternative 1a. For Method A, 
Alternative 1b is the primary analysis, and Alternative 1a is one of a 
range of cases included in the sensitivity analysis.
---------------------------------------------------------------------------

    \472\ Volpe CAFE Model, available at http://www.nhtsa.gov/fuel-economy.
---------------------------------------------------------------------------

(h) Civil Penalties in the NHTSA Analysis
    EPCA and EISA require that a manufacturer pay civil penalties if it 
does not have enough credits to cover a shortfall with one or both of 
the light-duty CAFE standards in a model year. While these provisions 
do not apply to HD pickups and vans, at this time, the CAFE model will 
show civil penalties owed in cases where available technologies and 
credits are estimated to be insufficient for a manufacturer to achieve 
compliance with a standard. These model-reported estimates have been 
excluded from this analysis. For Method A, this aspect of the model has 
been modified to also exclude from the calculation of ``effective 
cost'' used to select among available options to add specific 
technologies to specific vehicles.
(i) Coefficients for Fatality Calculations
    Both the NPRM and the current analysis consider the potential 
effects on crash safety of the technologies manufacturers may apply to 
their vehicles to meet each of the regulatory alternatives. NHTSA 
research has shown that vehicle mass reduction affects overall societal 
fatalities associated with crashes \473\ and, most relevant to this 
rule, mass reduction in heavier light- and medium-duty vehicles has an 
overall beneficial effect on societal fatalities. Reducing the mass of 
a heavier vehicle involved in a crash with another vehicle(s) makes it 
less

[[Page 73747]]

likely there will be fatalities among the occupants of the other 
vehicles. In addition to the effects of mass reduction, the analysis 
anticipates that these standards, by reducing the cost of driving HD 
pickups and vans, will lead to increased travel by these vehicles and, 
therefore, more crashes involving these vehicles. The Method B analysis 
considers overall impacts considering both of these factors, using a 
methodology similar to NHTSA's analyses for the MYs 2017-2025 CAFE and 
GHG emission standards.
---------------------------------------------------------------------------

    \473\ U.S. DOT/NHTSA, Relationships Between Fatality Risk Mass 
and Footprint in MY 2000-2007 PC and LTVs, ID: NHTSA-2010-0131-0336, 
Posted August 21, 2012.
---------------------------------------------------------------------------

    The Method B analysis includes estimates of the extent to which HD 
pickups and vans produced during MYs 2014-2030 may be involved in fatal 
crashes, considering the mass, survival, and mileage accumulation of 
these vehicles, taking into account changes in mass and mileage 
accumulation under each regulatory alternative. These calculations make 
use of the same coefficients applied to light trucks in the MYs 2017-
2025 CAFE rulemaking analysis. Baseline rates of involvement in fatal 
crashes are 13.03 and 13.24 fatalities per billion miles for vehicles 
with initial curb weights above and below 4,594 lbs, respectively. 
Considering that the data underlying the corresponding statistical 
analysis included observations through calendar year 2010, these rates 
are reduced by 9.6 percent to account for subsequent impacts of recent 
Federal Motor Vehicle Safety Standards (FMVSS) and anticipated 
behavioral changes (e.g., continued increases in seat belt use). For 
vehicles above 4,594 lbs--i.e., the majority of the HD pickup and van 
fleet--mass reduction is estimated to reduce the net incidence of 
highway fatalities by 0.34 percent per 100 lbs. of removed curb weight. 
For the few HD pickups and vans below 4,594 lbs, mass reduction is 
estimated to increase the net incidence of highway fatalities by 0.52 
percent per 100 lbs. Consistent with DOT guidance, the social cost of 
highway fatalities is estimated using a value of statistical life (VSL) 
of $9.36m in 2014, increasing thereafter at 1.18 percent annually.
    The Method A analysis uses the same methodology as described above, 
but applies coefficients that have been updated to reflect more current 
data, updated statistical analysis by NHTSA staff, and updated DOT 
guidance regarding the VSL. Baseline rates of involvement in fatal 
crashes are 16.06 and 14.35 fatalities per billion miles for pickups 
and vans with initial curb weights above and below 4,947 lbs, 
respectively. Considering that the data underlying the corresponding 
statistical analysis included observations through calendar year 2012, 
these rates are reduced by 9.6 percent to account for subsequent 
impacts of recent Federal Motor Vehicle Safety Standards (FMVSS) and 
anticipated behavioral changes (e.g., continued increases in seat belt 
use). For vehicles above 4,947 lbs--i.e., the majority of the HD pickup 
and van fleet--mass reduction is estimated to reduce the net incidence 
of highway fatalities by 0.72 percent per 100 lbs. of removed curb 
weight. For HD pickups and vans below 4,947 lbs (accounting for any 
applied mass reduction), mass reduction is estimated to reduce the net 
incidence of highway fatalities by 0.10 percent per 100 lbs. Consistent 
with DOT guidance, the social cost of highway fatalities is estimated 
using a value of statistical life (VSL) of $9.4m from 2015 forward.
(j) Compliance Credit Provisions
    Today's analysis accounts for the potential to over comply with 
standards and thereby earn compliance credits, applying these credits 
to ensuring compliance requirements. In doing so, the agencies treat 
any unused carried-forward credits as expiring after five model years, 
consistent with current and standards. For today's analysis, the 
agencies are not estimating the potential to ``borrow''--i.e., to carry 
credits back to past model years.
(k) Emission Factors
    While CAFE model calculates vehicular CO2 emissions 
directly on a per-gallon basis using fuel consumption and fuel 
properties (density and carbon content), the model calculates emissions 
of other pollutants (methane, nitrogen oxides, ozone precursors, carbon 
monoxide, sulfur dioxide, particulate matter, and air toxics) on a per-
mile basis. In doing so, the Method A analysis used corresponding 
emission factors estimated using EPA's MOVES model.\474\ To estimate 
emissions (including CO2) from upstream processes involved 
in producing, distributing, and delivering fuel, NHTSA has applied 
emission factors--all specified on a gram per gallon basis--derived 
from Argonne National Laboratory's GREET model.\475\
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    \474\ EPA MOVES model available at http://www3.epa.gov/otaq/models/moves/index.htm (last accessed Feb 23, 2015).
    \475\ GREET (Greenhouse Gases, Regulated Emissions, and Energy 
Use in Transportation) Model, Argonne National Laboratory, https://greet.es.anl.gov/.
---------------------------------------------------------------------------

(l) Refueling Time Benefits
    To estimate the value of time savings associated with vehicle 
refueling, the Method A analysis used estimates that an average 
refueling event involves refilling 60 percent of the tank's capacity 
over the course of 3.5 minutes, at an hourly cost of $27.22.
(m) External Costs of Travel
    Changes in vehicle travel will entail economic externalities. To 
estimate these costs, the Method A analysis used estimates that 
congestion-, crash-, and noise-related externalities will total 
5.1[cent]/mi., 2.8[cent]/mi., and 0.1[cent]/mi., respectively.
(n) Ownership and Operating Costs
    Method A results predict that the total cost of vehicle ownership 
and operation will change not just due to changes in vehicle price and 
fuel outlays, but also due to some other costs likely to vary with 
vehicle price. To estimate these costs, NHTSA has applied factors of 
5.5 percent (of price) for taxes and fees, 15.3 percent for financing, 
19.2 percent for insurance, 1.9 percent for relative value loss. The 
Method A analysis also estimates that average vehicle resale value will 
increase by 25 percent of any increase in new vehicle price.
(4) What Technologies Did the Agencies Consider
    The agencies considered over 35 vehicle technologies that 
manufacturers could use to improve the fuel consumption and reduce 
CO2 emissions of their vehicles during MYs 2021-2027. The 
majority of the technologies described in this section are readily 
available, well known and proven in other vehicle sectors, and could be 
incorporated into vehicles once production decisions are made. Other 
technologies considered may not currently be in production, but are 
beyond the research phase and under development, and are expected to be 
in production in highway vehicles over the next few years. These are 
technologies that are capable of achieving significant improvements in 
fuel economy and reductions in CO2 emissions, at reasonable 
costs. The agencies did not consider technologies in the research stage 
because there is insufficient time for such technologies to move from 
research to production during the model years covered by this final 
action.
    The technologies considered in the agencies' analysis are briefly 
described below. They fall into five broad categories: Engine 
technologies, transmission technologies, vehicle technologies, 
electrification/accessory technologies, and hybrid technologies.
    In this class of trucks and vans, diesel engines are installed in 
about half of all vehicles. The buyer's decision to purchase a diesel 
versus gasoline engine

[[Page 73748]]

depends on several factors including initial purchase price, fuel 
operating costs, durability, towing capability and payload capacity 
amongst other reasons. As discussed in VI.B. above, the agencies 
generally prefer to set standards that do not distinguish between fuel 
types where technological or market-based reasons do not strongly argue 
otherwise. However, as with Phase 1, we continue to believe that 
fundamental differences between spark ignition and compression ignition 
engines warrant unique fuel standards, which is also important in 
ensuring that our program maintains product choices available to 
vehicle buyers. Therefore, as discussed in Section B.1, we are 
maintaining separate standards for gasoline and diesel vehicles. In the 
context of our technology discussion for heavy-duty pickups and vans, 
we are treating gasoline and diesel engines separately so each has a 
set of baseline technologies. We discuss performance improvements in 
terms of changes to those baseline engines. Our cost and inventory 
estimates contained elsewhere reflect the current fleet baseline with 
an appropriate mix of gasoline and diesel engines. Note that we are not 
basing these standards on a targeted switch in the mix of diesel and 
gasoline vehicles. We believe our standards require similar levels of 
technology development and cost for both diesel and gasoline vehicles. 
Hence the program is not intended to force, nor discourage, changes in 
a manufacturer's fleet mix between gasoline and diesel vehicles.
    The following contains a description of technologies the agencies 
considered as potentially available in the rule timeframe, and hence, 
having potential to be part of a compliance pathway for these vehicles. 
Additionally, the agencies did not receive any comments indicating that 
the technology effectiveness estimates used in the determination of 
potential reductions in GHGs and fuel consumption are not 
representative of the expected ranges for expected duty cycles.
(a) Engine Technologies
    The agencies reviewed the engine technology estimates used in the 
2017-2025 light-duty rule, the 2014-2018 heavy-duty rule, and the 2015 
NHTSA Technology Study. In doing so the agencies reconsidered all 
available sources and updated the estimates as appropriate. The section 
below describes both diesel and gasoline engine technologies considered 
for this program.
(i) Low Friction Lubricants
    One of the most basic methods of reducing fuel consumption in both 
gasoline and diesel engines is the use of lower viscosity engine 
lubricants. More advanced multi-viscosity engine oils are available 
today with improved performance in a wider temperature band and with 
better lubricating properties. This can be accomplished by changes to 
the oil base stock (e.g., switching engine lubricants from a Group I 
base oils to lower-friction, lower viscosity Group III synthetic) and 
through changes to lubricant additive packages (e.g., friction 
modifiers and viscosity improvers). The use of 5W-30 motor oil is now 
widespread and auto manufacturers are introducing the use of even lower 
viscosity oils, such as 5W-20 and 0W-20, to improve cold-flow 
properties and reduce cold start friction. However, in some cases, 
changes to the crankshaft, rod and main bearings and changes to the 
mechanical tolerances of engine components may be required. In all 
cases, durability testing will be required to ensure that durability is 
not compromised. The shift to lower viscosity and lower friction 
lubricants will also improve the effectiveness of valvetrain 
technologies such as cylinder deactivation, which rely on a minimum oil 
temperature (viscosity) for operation.
(ii) Engine Friction Reduction
    In addition to low friction lubricants, manufacturers can also 
reduce friction and improve fuel consumption by improving the design of 
both diesel and gasoline engine components and subsystems. 
Approximately 10 percent of the energy consumed by a vehicle is lost to 
friction, and just over half is due to frictional losses within the 
engine.\476\ Examples include improvements in low-tension piston rings, 
piston skirt design, roller cam followers, improved crankshaft design 
and bearings, material coatings, material substitution, more optimal 
thermal management, and piston and cylinder surface treatments. 
Additionally, as computer-aided modeling software continues to improve, 
more opportunities for evolutionary friction reductions may become 
available. All reciprocating and rotating components in the engine are 
potential candidates for friction reduction, and minute improvements in 
several components can add up to a measurable fuel efficiency 
improvement.
---------------------------------------------------------------------------

    \476\ ``Impact of Friction Reduction Technologies on Fuel 
Economy,'' Fenske, G. Presented at the March 2009 Chicago Chapter 
Meeting of the `Society of Tribologists and Lubricated Engineers' 
Meeting, March 18th, 2009. Available at: http://www.chicagostle.org/program/2008-2009/Impact%20of%20Friction%20Reduction%20Technologies%20on%20Fuel%20Economy%20-%20with%20VGs%20removed.pdf (last accessed July 9, 2009).
---------------------------------------------------------------------------

(iii) Engine Parasitic Demand Reduction
    In addition to physical engine friction reduction, manufacturers 
can reduce the mechanical load on the engine from parasitics, such as 
oil, fuel, and coolant pumps. The high-pressure fuel pumps of direct-
injection gasoline and diesel engines have particularly high demand. 
Example improvements include variable speed or variable displacement 
water pumps, variable displacement oil pumps, more efficient high 
pressure fuel pumps, valvetrain upgrades and shutting off piston 
cooling when not needed.
(iv) Coupled Cam Phasing
    Valvetrains with coupled (or coordinated) cam phasing can modify 
the timing of both the inlet valves and the exhaust valves an equal 
amount by phasing the camshaft of an overhead valve engine.\477\ For 
overhead valve engines, which have only one camshaft to actuate both 
inlet and exhaust valves, couple cam phasing is the only variable valve 
timing (VVT) implementation option available and requires only one cam 
phaser.\478\ We also considered variable valve lift (VVL), which alters 
the intake valve lift in order to reduce pumping losses and more 
efficiently ingest air.
---------------------------------------------------------------------------

    \477\ Although couple cam phasing appears only in the single 
overhead cam and overhead valve branches of the decision tree, it is 
noted that a single phaser with a secondary chain drive would allow 
couple cam phasing to be applied to direct overhead cam engines. 
Since this would potentially be adopted on a limited number of 
direct overhead cam engines NHTSA did not include it in that branch 
of the decision tree.
    \478\ It is also noted that coaxial camshaft developments would 
allow other variable valve timing options to be applied to overhead 
valve engines. However, since they would potentially be adopted on a 
limited number of overhead valve engines, NHTSA did not include them 
in the decision tree.
---------------------------------------------------------------------------

(v) Cylinder Deactivation
    In conventional spark-ignited engines throttling the airflow 
controls engine torque output. At partial loads, efficiency can be 
improved by using cylinder deactivation instead of throttling. Cylinder 
deactivation can improve engine efficiency by disabling or deactivating 
(usually) half of the cylinders when the load is less than half of the 
engine's total torque capability--the valves are kept closed, and no 
fuel is injected--as a result, the trapped air within the deactivated 
cylinders is simply compressed and expanded as an air spring, with 
reduced friction and

[[Page 73749]]

heat losses. The active cylinders combust at almost double the load 
required if all of the cylinders were operating. Pumping losses are 
significantly reduced as long as the engine is operated in this ``part-
cylinder'' mode.
    Cylinder deactivation control strategy relies on setting maximum 
manifold absolute pressures or predicted torque within a range in which 
it can deactivate the cylinders. Noise and vibration issues reduce the 
operating range to which cylinder deactivation is allowed, although 
manufacturers are exploring vehicle changes that enable increasing the 
amount of time that cylinder deactivation might be suitable. Some 
manufacturers may choose to adopt active engine mounts and/or active 
noise cancellations systems to address Noise Vibration and Harshness 
(NVH) concerns and to allow a greater operating range of activation.
    Cylinder deactivation has seen a recent resurgence thanks to better 
valvetrain designs and engine controls. General Motors and Fiat 
Chrysler have incorporated cylinder deactivation across a substantial 
portion of their V8-powered lineups, including some heavy duty 
applications.
(vi) Stoichiometric Gasoline Direct Injection
    SGDI engines inject fuel at high pressure directly into the 
combustion chamber (rather than the intake port in port fuel 
injection). SGDI requires changes to the injector design, an additional 
high pressure fuel pump, new fuel rails to handle the higher fuel 
pressures and changes to the cylinder head and piston crown design. 
Direct injection of the fuel into the cylinder improves cooling of the 
air/fuel charge within the cylinder, which allows for higher 
compression ratios and increased thermodynamic efficiency without the 
onset of combustion knock. Recent injector design advances, improved 
electronic engine management systems and the introduction of multiple 
injection events per cylinder firing cycle promote better mixing of the 
air and fuel, enhance combustion rates, increase residual exhaust gas 
tolerance and improve cold start emissions. SGDI engines achieve higher 
power density and match well with other technologies, such as boosting 
and variable valvetrain designs.
    Most manufacturers have introduced vehicles with SGDI engines in 
light duty sectors, including GM and Ford and have announced their 
plans to increase dramatically the number of SGDI engines in their 
portfolios. SGDI has not been introduction on heavy duty applications 
at this time however as these largely dedicated heavy duty engines 
approach their redesign window, they are expected to become SGDI 
engines.
(vii) Turbocharging and Downsizing
    The specific power of a naturally aspirated engine is primarily 
limited by the rate at which the engine is able to draw air into the 
combustion chambers. Turbocharging and supercharging (grouped together 
here as boosting) are two methods to increase the intake manifold 
pressure and cylinder charge-air mass above naturally aspirated levels. 
Boosting increases the airflow into the engine, thus increasing the 
specific power level, and with it the ability to reduce engine 
displacement while maintaining performance. This effectively reduces 
the pumping losses at lighter loads in comparison to a larger, 
naturally aspirated engine.
    Almost every major manufacturer currently markets a vehicle with 
some form of boosting. While boosting has been a common practice for 
increasing performance for several decades, turbocharging has 
considerable potential to improve fuel economy and reduce 
CO2 emissions when the engine displacement is also reduced. 
Specific power levels for a boosted engine often exceed 100 hp/L, 
compared to average naturally aspirated engine power densities of 
roughly 70 hp/L. As a result, engines can be downsized roughly 30 
percent or higher while maintaining similar peak output levels. In the 
last decade, improvements to turbocharger turbine and compressor design 
have improved their reliability and performance across the entire 
engine operating range. New variable geometry turbines and ball-bearing 
center cartridges allow faster turbocharger spool-up (virtually 
eliminating the once-common ``turbo lag'') while maintaining high flow 
rates for increased boost at high engine speeds. Low speed torque 
output has been dramatically improved for modern turbocharged engines. 
However, even with turbocharger improvements, maximum engine torque at 
very low engine speed conditions, for example launch from standstill, 
is increased less than at mid and high engine speed conditions. The 
potential to downsize engines may be less on vehicles with low 
displacement to vehicle mass ratios for example a very small 
displacement engine in a vehicle with significant curb weight, in order 
to provide adequate acceleration from standstill, particularly up 
grades or at high altitudes.
    The use of GDI in combination with turbocharging and charge air 
cooling reduces the fuel octane requirements for knock limited 
combustion enabling the use of higher compression ratios and boosting 
pressures. Recently published data with advanced spray-guided injection 
systems and more aggressive engine downsizing targeted towards reduced 
fuel consumption and CO2 emissions reductions indicate that 
the potential for reducing CO2 emissions for turbocharged, 
downsized GDI engines may be as much as 15 to 30 percent relative to 
port-fuel-injected engines.14 15 16 17 18 Confidential 
manufacturer data suggests an incremental range of fuel consumption and 
CO2 emission reduction of 4.8 to 7.5 percent for 
turbocharging and downsizing. Other publicly-available sources suggest 
a fuel consumption and CO2 emission reduction of 8 to 13 
percent compared to current-production naturally-aspirated engines 
without friction reduction or other fuel economy technologies: A joint 
technical paper by Bosch and Ricardo suggesting fuel economy gain of 8 
to 10 percent for downsizing from a 5.7 liter port injection V8 to a 
3.6 liter V6 with direct injection using a wall-guided direct injection 
system; a Renault report suggesting a 11.9 percent NEDC fuel 
consumption gain for downsizing from a 1.4 liter port injection in-line 
4-cylinder engine to a 1.0 liter in-line 4-cylinder engine, also with 
wall-guided direct injection; and a Robert Bosch paper suggesting a 13 
percent NEDC gain for downsizing to a turbocharged DI engine, again 
with wall-guided injection. These reported fuel economy benefits show a 
wide range depending on the SGDI technology employed.
    Note that for this analysis the agencies determined that this 
technology path is only applicable to heavy duty applications that have 
operating conditions more closely associated with light duty vehicles. 
This includes vans designed mainly for cargo volume or modest payloads 
and having similar GCWR to light duty applications. These vans cannot 
tow trailers heavier than similar light duty vehicles and are largely 
already sharing engines of significantly smaller displacement and 
cylinder count compared to heavy duty vehicles designed mainly for 
trailer towing.
    ACEEE commented that 10 percent of pick-ups in the heavy duty 
sector are candidates for turbocharging and downsizing if they do not 
require higher payloads or towing capacity. Other commenters suggested 
that downsizing that has occurred in light duty could also occur in 
heavy duty. As discussed above, the agencies evaluated turbocharging 
and downsizing in

[[Page 73750]]

vehicles like vans which are not typically designed for extensive 
trailer towing. When we looked at pick-ups, we determined that 
consumers needing a pick-up without higher payload or trailer towing 
requirements would migrate to the lower cost light-duty versions which 
are typically identical in cabin size and seating as the heavy-duty 
versions but have less work capability. Because of this, in the 
agencies' assessment, the heavy-duty pickups retained the high trailer 
towing and payload requirements and the corresponding larger engines. 
AAPC comments supported this approach as the correct combination of 
engine to intended use and even provided in their comments data 
indicating that turbocharged and downsized engines are more fuel 
efficient at lighter loads however under working conditions expected of 
a heavy-duty pick-up they are actually less fuel efficient than the 
larger engines.
(viii) Cooled Exhaust-Gas Recirculation
    Cooled exhaust gas recirculation or Boosted EGR is a combustion 
concept that involves utilizing EGR as a charge diluent for controlling 
combustion temperatures and cooling the EGR prior to its introduction 
to the combustion system. Higher exhaust gas residual levels at part 
load conditions reduce pumping losses for increased fuel economy. The 
additional charge dilution enabled by cooled EGR reduces the incidence 
of knocking combustion and obviates the need for fuel enrichment at 
high engine power. This allows for higher boost pressure and/or 
compression ratio and further reduction in engine displacement and both 
pumping and friction losses while maintaining performance. Engines of 
this type use GDI and both dual cam phasing and discrete variable valve 
lift. The EGR systems considered in this final rule, consistent with 
the rule, will use a dual-loop system with both high and low pressure 
EGR loops and dual EGR coolers. The engines will also use single-stage, 
variable geometry turbocharging with higher intake boost pressure 
available across a broader range of engine operation than conventional 
turbocharged SI engines. Such a system is estimated to be capable of an 
additional 3 to 5 percent effectiveness relative to a turbocharged, 
downsized GDI engine without cooled-EGR. The agencies have also 
considered a more advanced version of such a cooled EGR system that 
employs very high combustion pressures by using dual stage 
turbocharging.
(ix) Lean-Burn Combustion
    The agencies considered the concept that gasoline engines that are 
normally stoichiometric mainly for emission reasons can run lean over a 
range of operating conditions and utilize diesel like aftertreatment 
systems to control NOX. For this analysis, we determined 
that the modal operation nature of this technology is currently only 
beneficial at light loads and will not be appropriate for a heavy duty 
application purchase specifically for its high work and load capacity.
(b) Diesel Engine Technologies
    Diesel engines have several characteristics that give them superior 
fuel efficiency compared to conventional gasoline, spark-ignited 
engines. Pumping losses are much lower due to lack of (or greatly 
reduced) throttling. The diesel combustion cycle operates at a higher 
compression ratio, with a very lean air/fuel mixture, and turbocharged 
light-duty diesels typically achieve much higher torque levels at lower 
engine speeds than equivalent-displacement naturally-aspirated gasoline 
engines. Additionally, diesel fuel has a higher energy content per 
gallon.\479\ However, diesel fuel also has a higher carbon to hydrogen 
ratio, which increases the amount of CO2 emitted per gallon 
of fuel used by approximately 15 percent over a gallon of gasoline.
---------------------------------------------------------------------------

    \479\ Burning one gallon of diesel fuel produces about 15 
percent more carbon dioxide than gasoline due to the higher density 
and carbon to hydrogen ratio.
---------------------------------------------------------------------------

    Based on confidential business information and the 2010 NAS Report, 
two major areas of diesel engine design could be improved during the 
timeframe of this final rule. These areas include aftertreatment 
improvements and a broad range of engine improvements.
(i) Aftertreatment Improvements
    The HD diesel pickup and van segment has largely adopted the SCR 
type of aftertreatment system to comply with criteria pollutant 
emission standards. As the experience base for SCR expands over the 
next few years, many improvements in this aftertreatment system such as 
construction of the catalyst, thermal management, and reductant 
optimization may result in a reduction in the amount of fuel used in 
the process. However, due to uncertainties with these improvements 
regarding the extent of current optimization and future criteria 
emissions obligations, the agencies are not considering aftertreatment 
improvements as a fuel-saving technology in the rulemaking analysis.
(ii) Engine Improvements
    Diesel engines in the HD pickup and van segment are expected to 
have several improvements in their base design in the 2021-2027 
timeframe. These improvements include items such as improved combustion 
management, optimal turbocharger design, and improved thermal 
management.
(c) Transmission Technologies
    The agencies have also reviewed the transmission technology 
estimates used in the 2017-2015 light-duty and 2014-2018 heavy-duty 
final rules. In doing so, NHTSA and EPA considered or reconsidered all 
available sources including the 2015 NHTSA Technology Study and updated 
the estimates as appropriate. The section below describes each of the 
transmission technologies considered for this rule.
(i) Automatic 8-Speed Transmissions
    Manufacturers can also choose to replace 6-speed automatic 
transmissions with 8-speed automatic transmissions. Additional ratios 
allow for further optimization of engine operation over a wider range 
of conditions, but this is subject to diminishing returns as the number 
of speeds increases. As additional gear sets are added, additional 
weight and friction are introduced requiring additional countermeasures 
to offset these losses. Some manufacturers are replacing 6-speed 
automatics already, and 7 to 10-speed automatics have entered 
production.
(ii) High Efficiency Transmission
    For this rule, a high efficiency transmission refers to some or all 
of a suite of incremental transmission improvement technologies that 
should be available within the 2019 to 2027 timeframe. The majority of 
these improvements address mechanical friction within the transmission. 
These improvements include but are not limited to: Shifting clutch 
technology improvements, improved kinematic design, dry sump 
lubrication systems, more efficient seals, bearings and clutches 
(reducing drag), component superfinishing and improved transmission 
lubricants.
(iii) Secondary Axle Disconnect
    The ability to disconnect some of the rotating components in the 
front axle on 4wd vehicles when the secondary axle is not needed for 
traction. This will reduce friction and increase fuel economy.

[[Page 73751]]

(d) Electrification/Accessory Technologies
(i) Electrical Power Steering or Electrohydraulic Power Steering
    Electric power steering (EPS) or Electrohydraulic power steering 
(EHPS) provides a potential reduction in CO2 emissions and 
fuel consumption over hydraulic power steering because of reduced 
overall accessory loads. This eliminates the parasitic losses 
associated with belt-driven power steering pumps which consistently 
draw load from the engine to pump hydraulic fluid through the steering 
actuation systems even when the wheels are not being turned. EPS is an 
enabler for all vehicle hybridization technologies since it provides 
power steering when the engine is off. EPS may be implemented on most 
vehicles with a standard 12V system. Some heavier vehicles may require 
a higher voltage system which may add cost and complexity.
(ii) Improved Accessories
    The accessories on an engine, including the alternator, coolant and 
oil pumps are traditionally mechanically-driven. A reduction in 
CO2 emissions and fuel consumption can be realized by 
driving them electrically, and only when needed (``on-demand'').
    Electric water pumps and electric fans can provide better control 
of engine cooling. For example, coolant flow from an electric water 
pump can be reduced and the radiator fan can be shut off during engine 
warm-up or cold ambient temperature conditions which will reduce warm-
up time, reduce warm-up fuel enrichment, and reduce parasitic losses.
    Indirect benefit may be obtained by reducing the flow from the 
water pump electrically during the engine warm-up period, allowing the 
engine to heat more rapidly and thereby reducing the fuel enrichment 
needed during cold operation and warm-up of the engine. Faster oil 
warm-up may also result from better management of the coolant warm-up 
period. Further benefit may be obtained when electrification is 
combined with an improved, higher efficiency engine alternator used to 
supply power to the electrified accessories.
    Intelligent cooling can more easily be applied to vehicles that do 
not typically carry heavy payloads, so larger vehicles with towing 
capacity present a challenge, as these vehicles have high cooling fan 
loads.\480\ However, towing vehicles tend to have large cooling system 
capacity and flow scaled to required heat rejection levels when under 
full load situations such as towing at GCWR in extreme ambient 
conditions. During almost all other situations, this design 
characteristic may result in unnecessary energy usage for coolant 
pumping and heat rejection to the radiator.
---------------------------------------------------------------------------

    \480\ In the CAFE model, improved accessories refers solely to 
improved engine cooling.
---------------------------------------------------------------------------

    The agencies considered whether to include electric oil pump 
technology for the rulemaking. Because it is necessary to operate the 
oil pump any time the engine is running, electric oil pump technology 
has insignificant effect on efficiency. Therefore, the agencies decided 
to not include electric oil pump technology.
(iii) Mild Hybrid
    Mild hybrid systems offer idle-stop functionality and a limited 
level of regenerative braking and power assist. These systems replace 
the conventional alternator with a belt or crank driven starter/
alternator and may add high voltage electrical accessories (which may 
include electric power steering and an auxiliary automatic transmission 
pump). The limited electrical requirements of these systems allow the 
use of lead-acid batteries or supercapacitors for energy storage, or 
the use of a small lithium-ion battery pack.
(iv) Strong Hybrid
    A hybrid vehicle is a vehicle that combines two significant sources 
of propulsion energy, where one uses a consumable fuel (like gasoline), 
and one is rechargeable (during operation, or by another energy 
source). Hybrid technology is well established in the U.S. light-duty 
market and more manufacturers are adding hybrid models to their 
lineups. Hybrids reduce fuel consumption through three major 
mechanisms:
     The internal combustion engine can be optimized (through 
downsizing, modifying the operating cycle, or other control techniques) 
to operate at or near its most efficient point more of the time. Power 
loss from engine downsizing can be mitigated by employing power assist 
from the secondary power source.
     A significant amount of the energy normally lost as heat 
while braking can be captured and stored in the energy storage system 
for later use.
     The engine is turned off when it is not needed, such as 
when the vehicle is coasting or when stopped.
    Hybrid vehicles utilize some combination of the three above 
mechanisms to reduce fuel consumption and CO2 emissions. The 
effectiveness of fuel consumption and CO2 reduction depends 
on the utilization of the above mechanisms and how aggressively they 
are pursued. One area where this variation is particularly prevalent is 
in the choice of engine size and its effect on balancing fuel economy 
and performance. Some manufacturers choose not to downsize the engine 
when applying hybrid technologies. In these cases, overall performance 
(acceleration) is typically improved beyond the conventional engine. 
However, fuel efficiency improves less than if the engine was downsized 
to maintain the same performance as the conventional version. The non-
downsizing approach is used for vehicles like trucks where towing and/
or hauling are an integral part of their performance requirements. In 
these cases, if the engine is downsized, the battery can be quickly 
drained during a long hill climb with a heavy load, leaving only a 
downsized engine to carry the entire load. Because towing capability is 
currently a heavily-marketed truck attribute, manufacturers are 
hesitant to offer a truck with a downsized engine, which can lead to a 
significantly diminished towing performance when the battery state of 
charge level is low, and therefore engines are traditionally not 
downsized for these vehicles. In assessing the cost of this technology, 
the agencies consequently assumed the cost of a full size engine.
    Strong Hybrid technology utilizes an axial electric motor connected 
to the transmission input shaft and connected to the engine crankshaft 
through a clutch. The axial motor is a motor/generator that can provide 
sufficient torque for launch assist, all electric operation, and the 
ability to recover significant levels of braking energy.
(e) Vehicle Technologies
(i) Mass Reduction
    Mass reduction is a technology that can be used in a manufacturer's 
strategy to meet the Heavy Duty Greenhouse Gas Phase 2 standards. 
Vehicle mass reduction (also referred to as ``down-weighting'' or 
``light-weighting''), decreases fuel consumption and GHG emissions by 
reducing the energy demand needed to overcome inertia forces, and 
rolling resistance. Automotive companies have worked with mass 
reduction technologies for many years and a lot of these technologies 
have been used in production vehicles. The weight savings achieved by 
adopting mass reduction technologies offset weight gains due to 
increased vehicle size, larger powertrains, and increased feature 
content (sound insulation,

[[Page 73752]]

entertainment systems, improved climate control, panoramic roof, etc.). 
Sometimes mass reduction has been used to increase vehicle towing and 
payload capabilities.
    Manufacturers employ a systematic approach to mass reduction, where 
the net mass reduction is the addition of a direct component or system 
mass reduction, also referred to as primary mass reduction, plus the 
additional mass reduction taken from indirect ancillary systems and 
components, also referred to as secondary mass reduction or mass 
compounding. There are more secondary mass reductions achievable for 
light-duty vehicles compared to heavy-duty vehicles, which are limited 
due to the higher towing and payload requirements for these vehicles.
    Mass reduction can be achieved through a number of approaches, even 
while maintaining other vehicle functionalities. As summarized by NAS 
in its 2011 light duty vehicle report,\481\ there are two key 
strategies for primary mass reduction: (1) Changing the design to use 
less material; (2) substituting lighter materials for heavier 
materials.
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    \481\ Committee on the Assessment of Technologies for Improving 
Light-Duty Vehicle Fuel Economy; National Research Council, 
``Assessment of Fuel Economy Technologies for Light-Duty Vehicles,'' 
2011. Available at http://www.nap.edu/catalog.php?record_id=12924 
(last accessed Jun 27, 2012).
---------------------------------------------------------------------------

    The first key strategy of using less material compared to the 
baseline component can be achieved by optimizing the design and 
structure of vehicle components, systems and vehicle structure. Vehicle 
manufacturers have long used these continually-improving CAE tools to 
optimize vehicle designs. For example, the Future Steel Vehicle (FSV) 
project \482\ sponsored by WorldAutoSteel used three levels of 
optimization: Topology optimization, low fidelity 3G (Geometry Grade 
and Gauge) optimization, and subsystem optimization, to achieve 30 
percent mass reduction in the body structure of a vehicle with a mild 
steel unibody structure. Using less material can also be achieved 
through improving the manufacturing process, such as by using improved 
joining technologies and parts consolidation. This method is often used 
in combination with applying new materials.
---------------------------------------------------------------------------

    \482\ SAE World Congress, ``Focus B-pillar `tailor rolled' to 8 
different thicknesses,'' Feb. 24, 2010. Available at http://www.sae.org/mags/AEI/7695 (last accessed Jun. 10, 2012).
---------------------------------------------------------------------------

    The second key strategy to reduce mass of an assembly or component 
involves the substitution of lower density and/or higher strength 
materials. Material substitution includes replacing materials, such as 
mild steel, with higher-strength and advanced steels, aluminum, 
magnesium, and composite materials. In practice, material substitution 
tends to be quite specific to the manufacturer and situation. Some 
materials work better than others for particular vehicle components, 
and a manufacturer may invest more heavily in adjusting to a particular 
type of advanced material, thus complicating its ability to consider 
others. The agencies recognize that like any type of mass reduction, 
material substitution has to be conducted not only with consideration 
to maintaining equivalent component strength, but also to maintaining 
all the other attributes of that component, system or vehicle, such as 
crashworthiness, durability, and noise, vibration and harshness (NVH).
    If vehicle mass is reduced sufficiently through application of the 
two primary strategies of using less material and material substitution 
described above, secondary mass reduction options may become available. 
Secondary mass reduction is enabled when the load requirements of a 
component are reduced as a result of primary mass reduction. If the 
primary mass reduction reaches a sufficient level, a manufacturer may 
use a smaller, lighter, and potentially more efficient powertrain while 
maintaining vehicle acceleration performance. If a powertrain is 
downsized, a portion of the mass reduction may be attributed to the 
reduced torque requirement which results from the lower vehicle mass. 
The lower torque requirement enables a reduction in engine 
displacement, changes to transmission torque converter and gear ratios, 
and changes to final drive gear ratio. The reduced powertrain torque 
enables the downsizing and/or mass reduction of powertrain components 
and accompanying reduced rotating mass (e.g., for transmission, 
driveshafts/halfshafts, wheels, and tires) without sacrificing 
powertrain durability. Likewise, the combined mass reductions of the 
engine, drivetrain, and body in turn reduce stresses on the suspension 
components, steering components, wheels, tires, and brakes, which can 
allow further reductions in the mass of these subsystems. Reducing the 
un-sprung masses such as the brakes, control arms, wheels, and tires 
further reduce stresses in the suspension mounting points, which will 
allow for further optimization and potential mass reduction. However, 
pickup trucks have towing and hauling requirements which must be taken 
into account when determining the amount of secondary mass reduction 
that is possible and so it is less than that of passenger cars.
    In 2015, EPA completed a multi-year study with FEV North America, 
Inc. on the lightweighting of a light-duty pickup truck, a 2011 GMC 
Silverado, titled ``Mass Reduction and Cost Analysis--Light-Duty Pickup 
Trucks Model Years 2020-2025.'' \483\ Results contain a cost curve for 
various mass reduction percentages with the main solution being 
evaluated for a 20.8 percent (510 kg/1122 lb.) mass reduction resulting 
in an increased direct incremental manufacturing cost of $2228. In 
addition, the report outlines the compounding effect that occurs in a 
vehicle with performance requirements including hauling and towing. 
Secondary mass evaluation was performed on a component level based on 
an overall 20 percent vehicle mass reduction. Results revealed 84 kg of 
the 510 kg, or 20 percent of the overall mass reduction, were from 
secondary mass reduction. Information on this study is summarized in 
SAE paper 2015-01-0559. NHTSA has also sponsored an on-going pickup 
truck lightweighting project. This project uses a more recent baseline 
vehicle, a MY 2014 GMC Silverado, and the project will be finished in 
2016. Both projects will be utilized for the light-duty GHG and CAFE 
Midterm Evaluation mass reduction baseline characterization and may be 
used to update assumptions of mass reduction for HD pickups and vans 
for the final Phase 2 rulemaking.
---------------------------------------------------------------------------

    \483\ ``Mass Reduction and Cost Analysis--Light-Duty Pickup 
Trucks Model Years 2020-2025,'' FEV, North America, Inc., April 
2015, Document no. EPA-420-R-15-006.
---------------------------------------------------------------------------

    In order to determine if technologies identified on light duty 
trucks are applicable to heavy-duty pickups, EPA contracted with FEV 
North America, Inc. to perform a scaling study in order to evaluate 
whether the technologies identified for the light-duty truck would be 
applicable for a heavy-duty pickup truck. In this study a 2013MY 
Silverado 2500, a 2007 Mercedes Sprinter and a 2010 Renault Master 
\484\ were analyzed. A 2013MY Silverado 2500 was purchased and torn 
down. The mass reduction results were 18.9 percent mass reduction at a 
cost of $2,372 and focused on aluminum intensive with AHSS frame. The 
Mercedes Sprinter and Renault Master analyses were performed based on 
information from the A2Mac1 database. The results were 18.15 percent 
mass reduction at a cost add of $2,293 for the Mercedes Sprinter

[[Page 73753]]

and 18.55 percent mass reduction at a cost add of $2,293 for the 
Master.
---------------------------------------------------------------------------

    \484\ ``Mass Reduction and Cost Analysis Heavy Duty Pickup Truck 
and Light Commercial Vans,'' 2016, EPA-420-D-16-003.
---------------------------------------------------------------------------

    In September 2015, Ford announced that its MY 2017 F-Series Super 
duty pickup (F250) would be manufactured with an aluminum body and 
overall the truck will be 350 lbs. lighter (5 percent-6 percent) than 
the current generation truck with steel.485 486 This is less 
overall mass reduction than the resultant lightweighting effort on the 
MY 2015 F-150, which achieved up to 750 lb. decrease in curb weight (12 
percent-13 percent) per vehicle.\487\ Strategies were employed by Ford 
in the F250 to ``improve the productivity of the Super Duty.'' In 
addition, Ford added several safety systems (and consequent mass) 
including cameras, lane departure warning, brake assist, etc. More 
details on the F250 will be known once it is released; however, a 
review of the F150 vehicle aluminum intensive design shows that it has 
an aluminum cab structure, body panels, and suspension components, as 
well as a high strength steel frame and a smaller, lighter and more 
efficient engine. The Executive Summary to Ducker Worldwide's 2014 
report \488\ states that the MY 2015 F-150 contains 1080 lbs. of 
aluminum with at least half being aluminum sheet and extrusions for 
body and closures. Ford's engine range for its light duty truck fleet 
includes a 2.7L EcoBoost V-6. The integrated loop, between Ford and the 
aluminum sheet suppliers, of aluminum manufacturing scrap and new 
aluminum sheet is integral to making aluminum a feasible lightweighting 
technology option for Ford. It is also possible that the strategy of 
aluminum body panels will be applied to the heavy duty F-350 version 
when it is redesigned.\489\
---------------------------------------------------------------------------

    \485\ http://www.techtimes.com/articles/87961/20150925/ford-s-2017-f-250-super-duty-with-an-aluminum-body-is-the-toughest-smartest-and-most-capable-super-duty-ever.htm, September 25, 2015.
    \486\ https://www.ford.com/trucks/superduty/2017/ 2017/.
    \487\ ``2008/9 Blueprint for Sustainability,'' Ford Motor 
Company. Available at: http://www.ford.com/go/sustainability (last 
accessed February 8, 2010).
    \488\ ``2015 North American Light Vehicle Aluminum Content 
Study--Executive Summary,'' June 2014, http://www.drivealuminum.org/research-resources/PDF/Research/2014/2014-ducker-report (last 
accessed February 26, 2015).
    \489\ http://www.foxnews.com/leisure/2014/09/30/ford-confirms-increased-aluminum-use-on-next-gen-super-duty-pickups/.
---------------------------------------------------------------------------

    The RIA for this rulemaking shows that 10 percent or less mass 
reduction is part of the projected strategy for compliance for HD 
pickups and vans. The cost and effectiveness assumptions for mass 
reduction technology are described in the RIA.
(ii) Low Rolling Resistance Tires
    Tire rolling resistance is the frictional loss associated mainly 
with the energy dissipated in the deformation of the tires under load 
and thus influences fuel efficiency and CO2 emissions. Other 
tire design characteristics (e.g., materials, construction, and tread 
design) influence durability, traction (both wet and dry grip), vehicle 
handling, and ride comfort in addition to rolling resistance. A typical 
LRR tire's attributes will include: Increased tire inflation pressure, 
material changes, and tire construction with less hysteresis, geometry 
changes (e.g., reduced aspect ratios), and reduction in sidewall and 
tread deflection. These changes will generally be accompanied with 
additional changes to suspension tuning and/or suspension design.
(iii) Aerodynamic Drag Reduction
    Many factors affect a vehicle's aerodynamic drag and the resulting 
power required to move it through the air. While these factors change 
with air density and the square and cube of vehicle speed, 
respectively, the overall drag effect is determined by the product of 
its frontal area and drag coefficient, Cd. Reductions in these 
quantities can therefore reduce fuel consumption and CO2 
emissions. Although frontal areas tend to be relatively similar within 
a vehicle class (mostly due to market-competitive size requirements), 
significant variations in drag coefficient can be observed. Significant 
changes to a vehicle's aerodynamic performance may need to be 
implemented during a redesign (e.g., changes in vehicle shape). 
However, shorter-term aerodynamic reductions, with a somewhat lower 
effectiveness, may be achieved through the use of revised exterior 
components (typically at a model refresh in mid-cycle) and add-on 
devices that currently being applied. The latter list will include 
revised front and rear fascias, modified front air dams and rear 
valances, addition of rear deck lips and underbody panels, and lower 
aerodynamic drag exterior mirrors.
(f) Air Conditioning Technologies
    These technologies include improved hoses, connectors and seats for 
leakage control. They also include improved compressors, expansion 
valves, heat exchangers and the control of these components for the 
purposes of improving tailpipe CO2 emissions as a result of 
A/C use.\490\
---------------------------------------------------------------------------

    \490\ See RIA Chapter 2.3 for more detailed technology 
descriptions.
---------------------------------------------------------------------------

(5) How did the agencies determine the costs and effectiveness of each 
of these technologies?
    Building on the technical analysis underlying the 2017-2025 MY 
light-duty vehicle rule, the 2014-2018 MY heavy-duty vehicle rule, and 
the 2015 NHTSA Technology Study, the agencies took a fresh look at 
technology cost and effectiveness values for purposes of this rule. For 
costs, the agencies reconsidered both the direct (or ``piece'') costs 
and indirect costs of individual components of technologies. For the 
direct costs, the agencies followed a bill of materials (BOM) approach 
employed by the agencies in the light-duty rule as well as referencing 
costs from the 2014-2018 MY heavy-duty vehicle rule and a new cost 
survey performed by Tetra Tech in 2014.
    For two technologies, stoichiometric gasoline direct injection 
(SGDI) and turbocharging with engine downsizing, the agencies relied to 
the extent possible on the available tear-down data and scaling 
methodologies used in EPA's ongoing study with FEV, Incorporated. This 
study consists of complete system tear-down to evaluate technologies 
down to the nuts and bolts to arrive at very detailed estimates of the 
costs associated with manufacturing them.\491\
---------------------------------------------------------------------------

    \491\ U.S. Environmental Protection Agency, ``Draft Report--
Light-Duty Technology Cost Analysis Pilot Study,'' Contract No. EP-
C-07-069, Work Assignment 1-3, September 3, 2009.
---------------------------------------------------------------------------

    For the other technologies, considering all sources of information 
and using the BOM approach, the agencies worked together intensively to 
determine component costs for each of the technologies and build up the 
costs accordingly. Where estimates differ between sources, we have used 
engineering judgment to arrive at what we believe to be the best cost 
estimate available today, and explained the basis for that exercise of 
judgment.
    Once costs were determined, they were adjusted to ensure that they 
were all expressed in 2012 dollars, and indirect costs were accounted 
for using a methodology consistent with the new ICM approach developed 
by EPA and used in the Phase 1 rule, and the 2012-2016 and 2017-2025 
light-duty rules. NHTSA and EPA also reconsidered how costs should be 
adjusted by modifying or scaling content assumptions to account for 
differences across the range of vehicle sizes and functional 
requirements, and adjusted the associated material cost impacts to 
account for the revised content. We present the individual technology 
costs used in this analysis in Chapter 2.11 of the RIA.

[[Page 73754]]

    Regarding estimates for technology effectiveness, the agencies used 
the estimates from the 2014 Southwest Research Institute study as a 
baseline, which was designed specifically to inform this rulemaking. In 
addition, the agencies used 2017-2025 light-duty rule as a reference, 
and adjusted these estimates as appropriate, taking into account the 
unique requirement of the heavy-duty test cycles to test at curb weight 
plus half payload versus the light-duty requirement of curb plus 300 
lbs. The adjustments were made on an individual technology basis by 
assessing the specific impact of the added load on each technology when 
compared to the use of the technology on a light-duty vehicle. The 
agencies also considered other sources such as the 2010 NAS Report, 
recent compliance data, and confidential manufacturer estimates of 
technology effectiveness. The agencies reviewed effectiveness 
information from the multiple sources for each technology and ensured 
that such effectiveness estimates were based on technology hardware 
consistent with the BOM components used to estimate costs. Together, 
the agencies compared the multiple estimates and assessed their 
validity, taking care to ensure that common BOM definitions and other 
vehicle attributes such as performance and drivability were taken into 
account.
    The agencies note that the effectiveness values estimated for the 
technologies may represent average values applied to the baseline fleet 
described earlier, and do not reflect the potentially limitless 
spectrum of possible values that could result from adding the 
technology to different vehicles. For example, while the agencies have 
estimated an effectiveness of 0.5 percent for low friction lubricants, 
each vehicle could have a unique effectiveness estimate depending on 
the baseline vehicle's oil viscosity rating. Similarly, the reduction 
in rolling resistance (and thus the improvement in fuel efficiency and 
the reduction in CO2 emissions) due to the application of 
LRR tires depends not only on the unique characteristics of the tires 
originally on the vehicle, but on the unique characteristics of the 
tires being applied, characteristics which must be balanced between 
fuel efficiency, safety, and performance. Aerodynamic drag reduction is 
much the same--it can improve fuel efficiency and reduce CO2 
emissions, but it is also highly dependent on vehicle-specific 
functional objectives. For purposes of this final rule, the agencies 
believe that employing average values for technology effectiveness 
estimates is an appropriate way of recognizing the potential variation 
in the specific benefits that individual manufacturers (and individual 
vehicles) might obtain from adding a fuel-saving technology.
    The assessment of the technology effectiveness and costs was 
determined from a combination of sources. First an assessment was 
performed by SwRI under contract with the agencies to determine the 
effectiveness and costs on several technologies that were generally not 
considered in the Phase 1 GHG rule time frame. Some of the technologies 
were common with the light-duty assessment but the effectiveness and 
costs of individual technologies were appropriately adjusted to match 
the expected effectiveness and costs when implemented in a heavy-duty 
application. Finally, the agencies performed extensive outreach to 
suppliers of engine, transmission and vehicle technologies applicable 
to heavy-duty applications to get industry input on cost and 
effectiveness of potential GHG and fuel consumption reducing 
technologies. The agencies did not receive comments disputing the 
expected technology effectiveness values or costs developed with input 
from industry.
    To achieve the levels of the Phase 2 standards for gasoline and 
diesel powered heavy-duty vehicles, a combination of the technologies 
previously discussed will be required respective to unique gasoline and 
diesel technologies and their challenges. Although some of the 
technologies may already be implemented in a portion of heavy-duty 
vehicles, none of the technologies discussed are considered ubiquitous 
in the heavy-duty fleet. Also, as will be expected, the available test 
data show that some vehicle models will not need the full complement of 
available technologies to achieve these standards. Furthermore, many 
technologies can be further improved (e.g., aerodynamic improvements) 
from today's best levels, and so allow for compliance without needing 
to apply a technology that a manufacturer might deem less desirable.
    Technology costs for HD pickups and vans are shown in Table VI-4. 
These costs reflect direct and indirect costs to the vehicle 
manufacturer for the 2021 model year. See Chapter 2.11. of the RIA for 
a more complete description of the basis of these costs.

Table VI-4--Technology Costs for HD Pickups & Vans Inclusive of Indirect
                        Cost Markups for MY 2021
                                 [2012$]
------------------------------------------------------------------------
               Technology                    Gasoline         Diesel
------------------------------------------------------------------------
Engine changes to accommodate low                      6               6
 friction lubes.........................
Engine friction reduction--level 1......             116             116
Engine friction reduction--level 2......             254             254
Dual cam phasing........................             183             183
Cylinder deactivation...................             196             N/A
Stoichiometric gasoline direct injection             451             N/A
Turbo improvements......................             N/A              16
Cooled EGR..............................             373             373
Turbocharging & downsizing \a\..........             671             N/A
``Right-sized'' diesel from larger                   N/A               0
 diesel.................................
8s automatic transmission (increment to              457             457
 6s automatic transmission).............
Improved accessories--level 1...........              82              82
Improved accessories--level 2...........             132             132
Low rolling resistance tires--level 1...              10              10
Passive aerodynamic improvements (aero                51              51
 1).....................................
Passive plus Active aerodynamic                      230             230
 improvements (aero 2)..................
Electric (or electro/hydraulic) power                151             151
 steering...............................
Mass reduction (10% on a 6500 lb                     318             318
 vehicle)...............................
Driveline friction reduction............             139             139
Stop-start (no regenerative braking)....             539             539
Mild HEV................................            2730            2730

[[Page 73755]]

 
Strong HEV, without inclusion of any                6779            6779
 engine changes.........................
------------------------------------------------------------------------
Note:
\a\ Cost to downsize from a V8 OHC to a V6 OHC engine with twin turbos.

    As explained above, the CAFE model works by adding technologies in 
an incremental fashion to each particular vehicle in a manufacturer's 
fleet until that fleet complies with the imposed standards. It does 
this by following a predefined set of decision trees whereby the 
particular vehicle is placed on the appropriate decision tree and it 
follows the predefined progression of technology available on that 
tree. At each step along the tree, a decision is made regarding the 
cost of a given technology relative to what already exists on the 
vehicle along with the fuel consumption improvement it provides 
relative to the fuel consumption at the current location on the tree, 
prior to deciding whether to take that next step on the tree or remain 
in the current location. Because the model works in this way, the input 
files must be structured to provide costs and effectiveness values for 
each technology relative to whatever technologies have been added in 
earlier steps along the tree. Table VI-5 presents the cost and 
effectiveness values used in the CAFE model input files.

             Table VI-5--CAFE Model Input Values for Cost & Effectiveness for Given Technologies \a\
----------------------------------------------------------------------------------------------------------------
                                                                          Incremental cost (2012$) a b c
                   Technology                     FC savings (%) -----------------------------------------------
                                                                       2021            2025            2027
----------------------------------------------------------------------------------------------------------------
Improved Lubricants and Engine Friction                     1.60              24              24              23
 Reduction......................................
Coupled Cam Phasing (SOHC)......................            3.82              48              43              39
Dual Variable Valve Lift (SOHC).................            2.47              42              37              34
Cylinder Deactivation (SOHC)....................            3.70              34              30              27
Intake Cam Phasing (DOHC).......................            0.00              48              43              39
Dual Cam Phasing (DOHC).........................            3.82              46              40              37
Dual Variable Valve Lift (DOHC).................            2.47              42              37              34
Cylinder Deactivation (DOHC)....................            3.70              34              30              27
Stoichiometric Gasoline Direct Injection (OHC)..            0.50              71              61              56
Cylinder Deactivation (OHV).....................            3.90             216             188             172
Variable Valve Actuation (OHV)..................            6.10              54              47              43
Stoichiometric Gasoline Direct Injection (OHV)..            0.50              71              61              56
Engine Turbocharging and Downsizing
    Small Gasoline Engines......................            8.00             518             441             407
    Medium Gasoline Engines.....................            8.00             -12             -62             -44
    Large Gasoline Engines......................            8.00             623             522             456
Cooled Exhaust Gas Recirculation................            3.04             382             332             303
Cylinder Deactivation on Turbo/downsized Eng....            1.70              33              29              26
Lean-Burn Gasoline Direct Injection.............            4.30           1,758           1,485           1,282
Improved Diesel Engine Turbocharging............            2.51              22              19              18
Engine Friction & Parasitic Reduction
    Small Diesel Engines........................            3.50             269             253             213
    Medium Diesel Engines.......................            3.50             345             325             273
    Large Diesel Engines........................            3.50             421             397             334
Downsizing of Diesel Engines (V6 to I-4)........           11.10               0               0               0
8-Speed Automatic Transmission \d\..............            5.00             482             419             382
Electric Power Steering.........................            1.00             160             144             130
Improved Accessories (Level 1)..................            0.93              93              83              75
Improved Accessories (Level 2)..................            0.93              57              54              46
Stop-Start System...............................            1.10             612             517             446
Integrated Starter-Generator....................            3.20           1,040             969             760
Strong Hybrid Electric Vehicle..................           17.20           3,038           2,393           2,133
Mass Reduction (5%).............................            1.50            0.28            0.24            0.21
Mass Reduction (additional 5%)..................            1.50            0.87            0.75            0.66
Reduced Rolling Resistance Tires................            1.10              10               9               9
Low-Drag Brakes.................................            0.40             106             102             102
Driveline Friction Reduction....................            0.50             153             137             124
Aerodynamic Improvements (10%)..................            0.70              58              52              47
Aerodynamic Improvements (add'l 10%)............            0.70             193             182             153
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Values for other model years available in CAFE model input files available at NHTSA Web site.
\b\ For mass reduction, cost reported on mass basis (per pound of curb weight reduction).
\c\ The model output has been adjusted to 2013$.
\d\ 8-speed automatic transmission costs include costs for high efficiency gearbox and aggressive shift logic
  whereas those costs were kept separate in prior analyses.


[[Page 73756]]

    In addition to the base technology cost and effectiveness inputs 
described above, the CAFE model accommodates inputs to adjust 
accumulated effectiveness under circumstances when combining multiple 
technologies could result in underestimation or overestimation of total 
incremental effectiveness relative to an ``unevolved'' baseline 
vehicle. These so-called synergy factors may be positive, where the 
combination of the technologies results in greater improvement than the 
additive improvement of each technology, or negative, where the 
combination of the technologies is lower than the additive improvement 
of each technology. The synergy factors used in the NPRM and Method B 
of the FRM are described in Table VI-6 Method A of the FRM uses 
synergies derived from a simulation project NHTSA undertook with 
Autnomie Argonne National Lab. A description of these changes is given 
in Section D.(8).

                Table VI-6--Technology Pair Effectiveness Synergy Factors for HD Pickups and Vans
----------------------------------------------------------------------------------------------------------------
                                                  Adjustment                                        Adjustment
                Technology pair                       (%)                Technology pair                (%)
----------------------------------------------------------------------------------------------------------------
8SPD/CCPS.....................................           -4.60  IATC/CCPS.......................           -1.30
8SPD/DEACO....................................           -4.60  IATC/DEACO......................           -1.30
8SPD/ICP......................................           -4.60  IATC/ICP........................           -1.30
8SPD/TRBDS1...................................            4.60  IATC/TRBDS1.....................            1.30
AERO2/SHEV1...................................            1.40  MR1/CCPS........................            0.40
CCPS/IACC1....................................           -0.40  MR1/DCP.........................            0.40
CCPS/IACC2....................................           -0.60  MR1/VVA.........................            0.40
DCP/IACC1.....................................           -0.40  MR2/ROLL1.......................           -0.10
DCP/IACC2.....................................           -0.60  MR2/SHEV1.......................           -0.40
DEACD/IATC....................................           -0.10  NAUTO/CCPS......................           -1.70
DEACO/IACC2...................................           -0.80  NAUTO/DEACO.....................           -1.70
DEACO/MHEV....................................           -0.70  NAUTO/ICP.......................           -1.70
DEACS/IATC....................................           -0.10  NAUTO/SAX.......................           -0.40
DTURB/IATC....................................            1.00  NAUTO/TRBDS1....................            1.70
DTURB/MHEV....................................           -0.60  ROLL1/AERO1.....................            0.10
DTURB/SHEV1...................................           -1.00  ROLL1/SHEV1.....................            1.10
DVVLD/8SPD....................................           -0.60  ROLL2/AERO2.....................            0.20
DVVLD/IACC2...................................           -0.80  SHFTOPT/MHEV....................           -0.30
DVVLD/IATC....................................           -0.60  TRBDS1/MHEV.....................            0.80
DVVLD/MHEV....................................           -0.70  TRBDS1/SHEV1....................           -3.30
DVVLS/8SPD....................................           -0.60  TRBDS1/VVA......................           -8.00
DVVLS/IACC2...................................           -0.80  TRBDS2/EPS......................           -0.30
DVVLS/IATC....................................           -0.50  TRBDS2/IACC2....................           -0.30
DVVLS/MHEV....................................           -0.70  TRBDS2/NAUTO....................           -0.50
                                                ..............  VVA/IACC1.......................           -0.40
                                                ..............  VVA/IACC2.......................           -0.60
                                                ..............  VVA/IATC........................           -0.60
----------------------------------------------------------------------------------------------------------------

    The CAFE model also accommodates inputs to adjust accumulated 
incremental costs under circumstances when the application sequence 
could result in underestimation or overestimation of total incremental 
costs relative to an ``unevolved'' baseline vehicle. For today's 
analysis, the agencies have applied one such adjustment, increasing the 
cost of medium-sized gasoline engines by $513 in cases where 
turbocharging and engine downsizing is applied with variable valve 
actuation.
    The analysis performed using Method A also applied cost inputs to 
address some costs encompassed neither by the agencies' estimates of 
the direct cost to apply these technologies, nor by the agencies' 
methods for ``marking up'' these costs to arrive at increases in the 
new vehicle purchase costs. To account for the additional costs that 
could be incurred if a technology is applied and then quickly replaced, 
the CAFE model accommodates inputs specifying a ``stranded capital 
cost'' specific to each technology. For this analysis, the model was 
run with inputs to apply about $78 of additional cost (per engine) if 
gasoline engine turbocharging and downsizing (separately for each 
``level'' considered) is applied and then immediately replaced, 
declining steadily to zero by the tenth model year following initial 
application of the technology. The model also accommodates inputs 
specifying any additional changes owners might incur in maintenance and 
post-warranty repair costs. For this analysis, the model was run with 
inputs indicating that vehicles equipped with less rolling-resistant 
tires could incur additional tire replacement costs equivalent to $21-
$23 (depending on model year) in additional costs to purchase the new 
vehicle. The agencies did not, however, include inputs specifying any 
potential changes repair costs that might accompany application of any 
of the above technologies. A sensitivity analysis using Method A, 
discussed below, includes a case in which repair costs are estimated 
using factors consistent with those underlying the indirect cost 
multipliers used to markup direct costs for the agencies' central 
analysis.
(6) Regulatory Alternatives Considered by the Agencies
    As discussed above, the model considers regulatory alternatives. 
The results of regulatory alternatives are considered relative to a 
``no action'' alternative where existing standards persist, but no 
further regulatory action is taken (in this case the MY 2018 standards 
from Phase I are the last regulatory action taken). The agencies also 
considered four regulatory alternatives. The preferred alternative with 
a standard that increases 2.5 percent in stringency annually for MY's 
2021-2027, and three others with annual increases in stringency of: 2.0 
percent, 3.5 percent, and 4.0 percent for MY's 2021-2025. For each of 
the ``action alternatives'' (i.e., those involving stringency increases 
beyond the no-action alternative), the annual

[[Page 73757]]

stringency increases are applied as follows: An annual stringency 
increase of r is applied by multiplying the model year 2020 target 
functions (identical to those applicable to model year 2018) by 1-r to 
define the model year 2021 target functions, multiplying the model year 
2021 target functions by 1-r to define the model year 2022 target 
functions, continuing through 2025 for all alternatives except for the 
preferred Alternative 3 which extends through 2027. In summary, the 
agencies have considered the following five regulatory alternatives in 
the CAFE model.

                                 Table VI-7--Considered Regulatory Alternatives
----------------------------------------------------------------------------------------------------------------
                                                               Annual stringency increase
        Regulatory alternative        --------------------------------------------------------------------------
                                              2019-2020                2021-2025                2026-2027
----------------------------------------------------------------------------------------------------------------
1: No Action.........................  None...................  None...................  None.
2: 2.0%/y............................  None...................  2.0%...................  None.
3: 2.5%/y............................  None...................  2.5%...................  2.5%
4: 3.5%/y............................  None...................  3.5%...................  None.
5: 4.0%/y............................  None...................  4.0%...................  None.
----------------------------------------------------------------------------------------------------------------

(7) NPRM Modifications of the Model
    The NPRM analysis (and the current analysis) reflect several 
changes made to the model since 2012, when NHTSA used the model to 
estimate the effects, costs, and benefits of final CAFE standards for 
light-duty vehicles produced during MYs 2017-2021, and augural 
standards for MYs 2022-2025. Some of these changes specifically enable 
analysis of potential fuel consumption standards (and, hence, 
CO2 emissions standards harmonized with fuel consumption 
standards) for heavy-duty pickups and vans; other changes implement 
more general improvements to the model. Key changes include the 
following:
     Changes to accommodate standards for heavy-duty pickups 
and vans, including attribute-based standards involving targets that 
vary with ``work factor.''
     Explicit calculation of test weight, taking into account 
test weight ``bins'' and differences in the definition of test weight 
for light-duty vehicles (curb weight plus 300 pound) and heavy-duty 
pickups and vans (average of GVWR and curb weight).
     Procedures to estimate increases in payload when curb 
weight is reduced, increases in towing capacity if GVWR is reduced, and 
calculation procedures to correspondingly update calculated work 
factors.
     Expansion of model inputs, procedures, and outputs to 
accommodate technologies not included in prior analyses.
     Changes to the algorithm used to apply technologies, 
enabling more explicit accounting for shared vehicle platforms and 
adoption and ``inheritance'' of major engine changes.
    These changes are reflected in updated model documentation 
available at NHTSA's Web site, the documentation also providing more 
information about the model's purpose, scope, structure, design, 
inputs, operation, and outputs. The agencies invited but did not 
receive comments on the CAFE model used for the NPRM analysis and used 
in this final rule for the Method B analysis.
(a) Product Cadence
    Past comments on the CAFE model have stressed the importance of 
product cadence--i.e., the development and periodic redesign and 
freshening of vehicles--in terms of involving technical, financial, and 
other practical constraints on applying new technologies, and NHTSA has 
steadily made changes to the model with a view toward accounting for 
these considerations. For example, early versions of the model added 
explicit ``carrying forward'' of applied technologies between model 
years, subsequent versions applied assumptions that most technologies 
would be applied when vehicles are freshened or redesigned, and more 
recent versions applied assumptions that manufacturers would sometimes 
apply technology earlier than ``necessary'' in order to facilitate 
compliance with standards in ensuing model years. Thus, for example, if 
a manufacturer is expected to redesign many of its products in model 
years 2018 and 2023, and the standard's stringency increases 
significantly in model year 2021, the CAFE model will estimate the 
potential that the manufacturer will add more technology than necessary 
for compliance in MY 2018, in order to carry those product changes 
forward through the next redesign and contribute to compliance with the 
MY 2021 standard.
    The model also accommodates estimates of overall limits (expressed 
as ``phase-in caps'' in model inputs) on the rates at which 
manufacturers' may practicably add technology to their respective 
fleets. So, for example, even if a manufacturer is expected to redesign 
half of its production in MY 2016, if the manufacturer is not already 
producing any strong hybrid electric vehicles (SHEVs), a phase-in cap 
can be specified in order to assume that manufacturer will stop 
applying SHEVs in MY 2016 once it has done so to at least 3 percent of 
its production in that model year.
    After the light-duty rulemaking analysis accompanying the 2012 
final rule regarding post-2016 CAFE standards and related GHG emissions 
standards, NHTSA staff began work on CAFE model changes expected to 
better reflect additional considerations involved with product planning 
and cadence. These changes, summarized below, interact with preexisting 
model characteristics discussed above.
(b) Platforms and Technology
    The term ``platform'' is used loosely in industry, but generally 
refers to a common structure shared by a group of vehicle variants. The 
degree of commonality varies, with some platform variants exhibiting 
traditional ``badge engineering'' where two products are differentiated 
by little more than insignias, while other platforms be used to produce 
a broad suite of vehicles that bear little outer resemblance to one 
another.
    Given the degree of commonality between variants of a single 
platform, manufacturers do not have complete freedom to apply 
technology to a vehicle: while some technologies (e.g. low rolling 
resistance tires) are very nearly ``bolt-on'' technologies, others 
involve substantial changes to the structure and design of the vehicle, 
and therefore necessarily are constant between vehicles that share a 
common platform. NHTSA staff has, therefore, modified the CAFE model 
such that all mass reduction and aero technologies are forced to be 
constant between variants of a platform. The agencies requested but did 
not receive comment on the suitability of this viewpoint, and

[[Page 73758]]

which technologies can deviate from one platform variant to another.
    Within the analysis fleet, each vehicle is associated with a 
specific platform. As the CAFE model applies technology, it first 
defines a platform ``leader'' as the vehicle variant of a platform with 
the highest technology utilization vehicle of mass reduction and 
aerodynamic technologies. As the vehicle applies technologies, it 
effectively harmonizes to the highest common denominator of the 
platform. If there is a tie, the CAFE model begins applying aerodynamic 
and mass reduction technology to the vehicle with the lowest average 
sales across all available model years. If there remains a tie, the 
model begins by choosing the vehicle with the highest average MSRP 
across all available model years. The model follows this formulation 
due to previous market trends suggesting that many technologies begin 
deployment at the high-end, low-volume end of the market as 
manufacturers build their confidence and capability in a technology, 
and later expand the technology across more mainstream product lines.
    In the HD pickup and van market, there is a relatively small amount 
of diversity in platforms produced by manufacturers: Typically 1-2 
truck platforms and 1-2 van platforms. However, accounting for 
platforms will take on greater significance in future analyses 
involving the light-duty fleet. The agency requested but did not 
receive comments on the general use of platforms within CAFE 
rulemaking.
(c) Engine and Transmission Inheritance
    In practice, manufacturers are limited in the number of engines and 
transmissions that they produce. Typically a manufacturer produces a 
number of engines--perhaps six or eight engines for a large 
manufacturer--and tunes them for slight variants in output for a 
variety of car and truck applications. Manufacturers limit complexity 
in their engine portfolio for much the same reason as they limit 
complexity in vehicle variants: They face engineering manpower 
limitations, and supplier, production and service costs that scale with 
the number of parts produced.
    In previous usage of the CAFE model, engines and transmissions in 
individual models were allowed relative freedom in technology 
application, potentially leading to solutions that would, if followed, 
involve unaccounted-for costs associated with increased complexity in 
the product portfolio. The lack of a constraint in this area allowed 
the model to apply different levels of technology to the engine in each 
vehicle at the time of redesign or refresh, independent of what was 
done to other vehicles using a previously identical engine.
    In the current version of the CAFE model, engines and transmissions 
that are shared between vehicles must apply the same levels of 
technology in all technologies dictated by engine or transmission 
inheritance. This forced adoption is referred to as ``engine 
inheritance'' in the model documentation.
    As with platform-shared technologies, the model first chooses an 
``engine leader'' among vehicles sharing the same engine. The leader is 
selected first by the vehicle with the lowest average sales across all 
available model years. If there is a tie, the vehicle with the highest 
average MSRP across model years is chosen. The model applies the same 
logic with respect to the application of transmission changes. As with 
platforms, this is driven by the concept that vehicle manufacturers 
typically deploy new technologies in small numbers prior to deploying 
widely across their product lines.
(d) Interactions Between Regulatory Classes
    Like earlier versions, the current CAFE model provides for 
integrated analysis spanning different regulatory classes, accounting 
both for standards that apply separately to different classes and for 
interactions between regulatory classes. Light vehicle CAFE standards 
are specified separately for passenger cars and light trucks. However, 
there is considerable sharing between these two regulatory classes. 
Some specific engines and transmissions are used in both passenger cars 
and light trucks, and some vehicle platforms span these regulatory 
classes. For example, some sport-utility vehicles are offered in 2WD 
versions classified as passenger cars and 4WD versions classified as 
light trucks. Integrated analysis of manufacturers' passenger car and 
light truck fleets provides the ability to account for such sharing and 
reduce the likelihood of finding solutions that could involve 
impractical levels of complexity in manufacturers' product lines. In 
addition, integrated analysis provides the ability to simulate the 
potential that manufactures could earn CAFE credits by over complying 
with one standard and use those credits toward compliance with the 
other standard (i.e., to simulate credit transfers between regulatory 
classes).
    HD pickups and vans are regulated separately from light-duty 
vehicles. While manufacturers cannot transfer credits between light-
duty and MDHD classes, there is some sharing of engineering and 
technology between light-duty vehicles and HD pickups and vans. For 
example, some passenger vans with GVWR over 8,500 lbs. are classified 
as medium-duty passenger vehicles (MDPVs) and thus included in 
manufacturers' light-duty truck fleets, while cargo vans sharing the 
same nameplate are classified as HD vans.
(e) Phase-In Caps
    The CAFE model retains the ability to use phase-in caps (specified 
in model inputs) as proxies for a variety of practical restrictions on 
technology application. Unlike vehicle-specific restrictions related to 
redesign, refreshes or platforms/engines, phase-in caps constrain 
technology application at the vehicle manufacturer level. They are 
intended to reflect a manufacturer's overall resource capacity 
available for implementing new technologies (such as engineering and 
development personnel and financial resources), thereby ensuring that 
resource capacity is accounted for in the modeling process.
    In previous CAFE rulemakings, redesign/refresh schedules and phase-
in caps were the primary mechanisms to reflect an OEM's limited pool of 
available resources during the rulemaking time frame and the years 
leading up to the rulemaking time frame, especially in years where many 
models may be scheduled for refresh or redesign. The newly-introduced 
representation platform-, engine-, and transmission-related 
considerations discussed above augment the model's preexisting 
representation of redesign cycles and accommodation of phase-in caps. 
Considering these new constraints, inputs for today's analysis de-
emphasize reliance on phase-in caps.
    In the NPRM and Method B of the FRM application of the CAFE model, 
phase-in caps are used only for the most advanced technologies included 
in the analysis, i.e., SHEVs and lean-burn GDI engines, considering 
that these technologies are most likely to involve implementation costs 
and risks not otherwise accounted for in corresponding input estimates 
of technology cost. For these two technologies, the agencies have 
applied caps that begin at 3 percent (i.e., 3 percent of the 
manufacturer's production) in MY 2017, increase at 3 percent annually 
during the ensuing nine years (reaching 30 percent in the MY 2026), and 
subsequently increasing at 5 percent annually for four years (reaching 
50 percent in MY 2030). Note that the agencies did not feel that lean-
burn engines were feasible in the

[[Page 73759]]

timeframe of this rulemaking, so decided to reject any model runs where 
they were selected. (In any case, due to the cost ineffectiveness of 
this technology, it was never chosen). The agencies did not receive 
comments specifically on this approach for phase-in caps. The agencies 
received comments regarding the general feasibility of SHEVs in this 
market segment, with some commenters commenting that SHEVs are not 
feasible for HD pickups and vans. These comments are discussed in 
Section C.8. While the agencies have retained the above approach for 
SHEV phase-in caps, the agencies have conducted a sensitivity analysis 
setting the SHEV caps at zero, showing that the Phase 2 standards are 
feasible and appropriate without the use of SHEVs. This sensitivity 
analysis is described in Section E.
    For Method A of the NPRM the phase-in caps have been set to 100 
percent, so that the model no longer relies on phase-in caps to limit 
the early-year application of advanced technologies. This changes is 
further described in the Method B of the FRM specific section below.
(f) Impact of Vehicle Technology Application Requirements
    Compared to prior analyses of light-duty standards, these model 
changes, along with characteristics of the HD pickup and van fleet 
result in some changes in the broad characteristics of the model's 
application of technology to manufacturers' fleets. First, since the 
number of HD pickup and van platforms in a portfolio is typically 
small, compliance with standards may appear especially ``lumpy'' 
(compared to previous applications of the CAFE model to the more highly 
segmented light-duty fleet), with significant over compliance when 
widespread redesigns precede stringency increases, and/or significant 
application of carried-forward (aka ``banked'') credits.
    Second, since the use of phase-in caps has been de-emphasized and 
manufacturer technology deployment remains tied strongly to estimated 
product redesign and freshening schedules, technology penetration rates 
may jump more quickly as manufacturers apply technology to high-volume 
products in their portfolio.
    By design, restrictions that enforce commonality of mass reduction 
and aerodynamic technologies on variants of a platform, and those that 
enforce engine inheritance, will result in fewer vehicle-technology 
combinations in a manufacturer's future modeled fleet. These 
restrictions are expected to more accurately capture the true costs 
associated with producing and maintaining a product portfolio.
(g) Accounting for Test Weight, Payload, and Towing Capacity
    As mentioned above, NHTSA has also revised the CAFE model to 
explicitly account for the regulatory ``binning'' of test weights used 
to certify light-duty fuel economy and HD pickup and van fuel 
consumption for purposes of evaluating fleet-level compliance with fuel 
economy and fuel consumption standards. For HD pickups and vans, test 
weight (TW) is based on adjusted loaded vehicle weight (ALVW), which is 
defined as the average of gross vehicle weight rating (GVWR) and curb 
weight (CW). TW values are then rounded, resulting in TW ``bins'':

ALVW <= 4,000 lb.: TW rounded to nearest 125 lb.
4000 lb. < ALVW <= 5,500 lb.: TW rounded to nearest 250 lb.
ALVW > 5,500 lb.: TW rounded to nearest 500 lb.

    This ``binning'' of TW is relevant to calculation of fuel 
consumption reductions accompanying mass reduction. Model inputs for 
mass reduction (as an applied technology) are expressed in terms of a 
percentage reduction of curb weight and an accompanying estimate of the 
percentage reduction in fuel consumption, setting aside rounding of 
test weight. Therefore, to account for rounding of test weight, NHTSA 
has modified these calculations as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.013


Where:

[Delta]CW = % change in curb weight (from model input),
[Delta]FCunrounded_TW = % change in fuel consumption 
(from model input), without TW rounding,
[Delta]TW = % change in test weight (calculated), and
[Delta]FCrounded_TW = % change in fuel consumption 
(calculated), with TW rounding.

    As a result, some applications of vehicle mass reduction will 
produce no compliance benefit at all, in cases where the changes in 
ALVW are too small to change test weight when rounding is taken into 
account. On the other hand, some other applications of vehicle mass 
reduction will produce significantly more compliance benefit than when 
rounding is not taken into account, in cases where even small changes 
in ALVW are sufficient to cause vehicles' test weights to increase by, 
e.g., 500 lbs. when rounding is accounted for. Model outputs now 
include initial and final TW, GVWR, and GCWR (and, as before, CW) for 
each vehicle model in each model year. The agencies invited but did not 
receive comment on how TW is modeled.
    In addition, considering that the regulatory alternatives in the 
agencies' analysis all involve attribute-based standards in which 
underlying fuel consumption targets vary with ``work factor'' (defined 
by the agencies as the sum of three quarters of payload, one quarter of 
towing capacity, and 500 lb. for vehicles with 4WD), NHTSA has modified 
the CAFE model to apply inputs defining shares of curb weight reduction 
to be ``returned'' to payload and shares of GVWR reduction to be 
returned to towing capacity. The standards' dependence on work factor 
provides some incentive to increase payload and towing capacity, both 
of which are buyer-facing measures of vehicle utility. In the agencies' 
judgment, this provides reason to assume that if vehicle mass is 
reduced, manufacturers are likely to ``return'' some of the change to 
payload and/or towing capacity. For this analysis, the agencies have 
applied the following assumptions:
     GVWR will be reduced by half the amount by which curb 
weight is reduced. In other words, 50 percent of the curb weight 
reduction will be returned to payload.
     GCWR will not be reduced. In other words, 100 percent of 
any GVWR reduction will be returned to towing capacity.
     GVWR/CW and GCWR/GVWR will not increase beyond levels 
observed among the majority of similar vehicles (or, for outlier 
vehicles, initial values):

[[Page 73760]]



    Table VI-8 Ratios for Modifying GVW and GCW as a Function of Mass
                                Reduction
------------------------------------------------------------------------
                                              Maximum ratios assumed
                                             enabled by mass reduction
                  Group                  -------------------------------
                                              GVWR/CW        GCWR/GVWR
------------------------------------------------------------------------
Unibody.................................            1.75            1.50
Gasoline pickups > 13k GVWR.............            2.00            1.50
Other gasoline pickups..................            1.75            2.25
Diesel SRW pickups......................            1.75            2.50
All other...............................            1.75            2.25
------------------------------------------------------------------------

    The first of two of these inputs are specified along with standards 
for each regulatory alternative, and the GVWR/CW and GCWR/GVWR ``caps'' 
are specified separately for each vehicle model in the analysis fleet.
    In addition, NHTSA has changed the model to prevent HD pickup and 
van GVWR from falling below 8,500 lbs. when mass reduction is applied 
(because doing so will cause vehicles to be reclassified as light-duty 
vehicles), and to treat any additional mass for hybrid electric 
vehicles as reducing payload by the same amount (e.g., if adding a 
strong HEV package to a vehicle involves a 350 pound penalty, GVWR is 
assumed to remain unchanged, such that payload is also reduced by 350 
lbs).
    The agencies invited but did not receive comment on estimating how 
changes in vehicle mass may impact fuel consumption, GVWR, and GCWR.
(8) Subsequent Changes to the CAFE Model (for Method A)
    Since issuing the NPRM, NHTSA has made further changes to the CAFE 
model, in order to estimate the potential impacts of simultaneous 
standards for both light-duty vehicles and HD pickups and vans. Among 
the updates most relevant to analysis supporting the final standards 
for HD pickups and vans, the current model: includes refinements to 
enable accounting for platforms, engines, and transmissions sharing 
between light-duty and HD pickups and vans; reflects refinements to how 
models for the first application of new technology are identified among 
shared platforms, engines, and transmissions; allows payback period, 
discount rate, survival rates, and mileage accumulation schedules to be 
specified separately for each vehicle class; makes use of large scale 
simulation modeling to more accurately account for synergies among 
technologies to estimate the fuel consumption impact of different 
combinations of technologies; provides the ability to selectively 
exclude fine payment from the ``effective cost'' calculation used to 
simulation manufacturers' decisions regarding the application of fuel-
saving technologies; and expands the use of forward planning to 
estimate decisions to use credits that would otherwise expire. Changes 
to the CAFE model are discussed at greater length below and in the CAFE 
model documentation.
    Also since issuing the NPRM, NHTSA has revised many model inputs to 
reflect information that has become available since the proposal. Among 
the updates most relevant to analysis supporting the final rule, these 
inputs reflect: an updated vehicle-level market forecast based on data 
regarding the 2015 model year fleet and a new commercially-available 
manufacturer- and segment-level market forecast, and spanning light-
duty vehicles and HD pickups and vans; newer fuel prices and total 
vehicle production volumes from the Energy Information Administration's 
Annual Energy Outlook 2015; a database, based on a large-scale full 
vehicle simulation study, of estimates of the effect of thousands of 
different combinations of technologies on fuel consumption; and updated 
mileage accumulation schedules based on a database of more than 70 
million odometer readings.
    NHTSA implemented these changes to the CAFE model and accompanying 
inputs to support both today's final rule promulgating new fuel 
consumption standards for HD pickups and vans and the Draft Technical 
Assessment Report regarding agency's consideration of CAFE standards 
for light duty vehicles for model years 2022-2025. This provided a 
basis to analyze the fleets simultaneously, accounting for interactions 
between the fleets; the draft RIA (p. 10-18) accompanying the NPRM 
identified this as a planned improvement for the final rule, and some 
stakeholders' comments (e.g., CARB,\492\ UCS,\493\ and CBD \494\) 
indicated that such interactions should be accounted for.
---------------------------------------------------------------------------

    \492\ CARB, Docket No. NHTSA-2014-0132-0125, at 17-18; 52-53.
    \493\ UCS, Docket No. EPA-HQ-OAR-2014-0827-1329, at pages 23-24.
    \494\ CBD, Docket No. NHTSA-2014-0132-0101 at pages 8-9.
---------------------------------------------------------------------------

    The remainder of this section summarizes changes to the CAFE model 
and inputs made subsequent to the NPRM analysis, summarizes results of 
the updated analysis, and discusses.
(a) Interactions Between Regulatory Classes
    Like earlier versions, the current CAFE model provides for 
integrated analysis spanning different regulatory classes, accounting 
both for standards that apply separately to different classes and for 
interactions between regulatory classes. Light vehicle CAFE standards 
are specified separately for passenger cars and light trucks. However, 
there is considerable sharing between these two regulatory classes. 
Some specific engines and transmissions are used in both passenger cars 
and light trucks, and some vehicle platforms span these regulatory 
classes. For example, some sport-utility vehicles are offered in 2WD 
versions classified as passenger cars and 4WD versions classified as 
light trucks. Integrated analysis of manufacturers' passenger car and 
light truck fleets provides the ability to account for such sharing and 
reduce the likelihood of finding solutions that could involve 
impractical levels of complexity in manufacturers' product lines. In 
addition, integrated analysis provides the ability to simulate the 
potential that manufactures could earn CAFE credits by over complying 
with one standard and use those credits toward compliance with the 
other standard (i.e., to simulate credit transfers between regulatory 
classes).
    HD pickups and vans are regulated separately from light-duty 
vehicles. While manufacturers cannot transfer credits between light-
duty and MDHD classes, there is some sharing of engineering and 
technology between light-duty vehicles and HD pickups and vans. For 
example, some passenger vans with GVWR over 8,500 pounds are classified 
as medium-duty passenger vehicles (MDPVs) and thus included in 
manufacturers' light-duty truck fleets,

[[Page 73761]]

while cargo vans sharing the same nameplate are classified as HD vans.
    The FRM Method A analysis uses an overall analysis fleet spanning 
both the light-duty and HD pickup and van fleets. As discussed below, 
doing so shows some technology ``spilling over'' to HD pickups and vans 
due, for example, to the application of technology in response to 
current light-duty standards. For most manufacturers, these 
interactions appear relatively small. For Nissan, however, they appear 
considerable, because Nissan's heavy-duty vans use engines also used in 
Nissan's light-duty SUVs. Unlike the Method A analysis, the Method B 
analysis is independent from the light-duty program.
    In the NPRM proposing new standards for heavy-duty pickups and 
vans, NHTSA and EPA requested comment on the expansion of the analysis 
fleet such that the impacts of new HD pickup and van standards can be 
estimated within the context of an integrated analysis of light-duty 
vehicles and HD pickups and vans, accounting for interactions between 
the fleets. As mentioned above, some environmental organizations 
specifically cited commonalities and overlap between light- and heavy-
duty products.
(b) Phase-In Caps
    The model also accommodates estimates of overall limits (expressed 
as ``phase-in caps'' in model inputs) on the rates at which 
manufacturers' may practicably add technology to their respective 
fleets. So, for example, even if a manufacturer is expected to redesign 
half of its production in MY 2016, if the manufacturer is not already 
producing any strong hybrid electric vehicles (SHEVs), a phase-in cap 
can be specified in order to assume that manufacturer will stop 
applying SHEVs in MY 2016 once it has done so to at least 3 percent of 
its production in that model year. Today's analysis sets all of these 
caps at 100 percent, relying on other model constraints (in particular, 
the assumption that many technologies are most practicably applied as 
part of a vehicle freshening or redesign) to estimate practicable 
technology application pathways.
    The CAFE model retains the ability to use phase-in caps (specified 
in model inputs) as proxies for a variety of practical restrictions on 
technology application. Unlike vehicle-specific restrictions related to 
redesign, refreshes or platforms/engines, phase-in caps constrain 
technology application at the vehicle manufacturer level. Introduced in 
the 2006 version of the CAFE model, they were intended to reflect a 
manufacturer's overall resource capacity available for implementing new 
technologies (such as engineering and development personnel and 
financial resources), thereby ensuring that resource capacity is 
accounted for in the modeling process.
    In previous fuel efficiency rulemakings, redesign/refresh schedules 
and phase-in caps were the primary mechanisms to reflect an OEM's 
limited pool of available resources during the rulemaking time frame 
and the years leading up to the rulemaking time frame, especially in 
years where many models may be scheduled for refresh or redesign. The 
newly-introduced representation platform-, engine-, and transmission-
related considerations discussed above augment the model's preexisting 
representation of redesign cycles, and as discussed above, inputs for 
today's analysis de-emphasize reliance on phase-in caps.
(c) Accounting for Credits
    The changes discussed above relate specifically to the model's 
approach to simulating manufacturers' potential addition of fuel-saving 
technology in response to fuel efficiency standards and fuel prices 
within an explicit product planning context. The model's approach to 
simulating compliance decisions also accounts for the potential to earn 
and use fuel consumption credits, as provided by EPCA/EISA. Like past 
versions, the current CAFE model can be used to simulate credit carry-
forward (a.k.a. banking) between model years and transfers between the 
passenger car and light truck fleets, but not credit carry-back (a.k.a. 
borrowing) between model years or trading between manufacturers. Unlike 
past versions, the current CAFE model provides a basis to specify (in 
model inputs) fuel consumption credits available from model years 
earlier than those being simulated explicitly. For example, with 
today's analysis representing model years 2015-2032 explicitly, credits 
specified as being available from model year 2014 are made available 
for use through model year 2019 (given the current 5-year limit on 
carry-forward of credits).
    As discussed in the CAFE model documentation, the model's default 
logic attempts to maximize credit carry-forward--that is to ``hold on'' 
to credits for as long as possible.\495\ Although the model uses 
credits before expiry if needed to cover shortfalls when insufficient 
opportunity to add technology is available to achieve compliance with a 
standard, the model will otherwise carry forward credits until they are 
about to expire, at which point it will use them before adding 
technology. As further discussed in the CAFE model documentation, model 
inputs can be used to adjust this logic to shift the use of credits 
ahead by one or more model years.
---------------------------------------------------------------------------

    \495\ Volpe CAFE Model Documentation, July 2016, pg 64. 
Available at http://www.nhtsa.gov/Laws%20&%20Regulations/CAFE%20-%20Fuel%20Economy/cafe-volpe-model.
---------------------------------------------------------------------------

    The example presented below illustrates how some of aspects of the 
current model logic around credits impacts estimation of technology 
application by a manufacturer within the context of a specified set of 
standards, focusing here on the model's estimate of Ford's potential 
technology application under the preferred alternative. Overall results 
for Ford and other manufacturers are summarized in Section VI.D.

[[Page 73762]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.014

    Several aspects of the estimated achieved and required fuel 
consumption levels shown above are notable. First, the characteristics 
of Ford's fleet as represented in today's analysis fleet are such that 
the heavy duty pickup and van fleet falls short of average fuel 
efficiency standard in MY's 2023 through 2027. However, they exceed 
their standard for MY's 2016 through 2022. The current analysis uses 
logic that reflect the potential that Ford could use the 5-year carry 
forward provision to use fuel efficiency credits earned in MY's 2018 
through MY 2022, to cover the shortfalls for MY's 2023 to 2027. The 
model assumes Ford will use as many of the MY 2018 expiring credits as 
necessary to cover the shortfall in MY 2023. For MY 2024 they will use 
all available MY 2019 credits before applying any additional MY 2020 
credits necessary to cover the shortfall (in this particular case there 
are enough MY 2019 credits to cover the shortfall in MY 2024). This 
pattern continues for all model years where there is a shortfall--the 
model applies the oldest remaining credits first. Even so, today's 
analysis indicates Ford could be required to pay civil penalties for 
noncompliance without the addition of modest fuel savings in MY 2027. 
The change to the model which accounts for credits earned prior to MY 
2015 is not illustrated in this example. However, Ford comes in with 
fuel consumption credits from MY's prior to MY 2015; if they had come 
in with an initial shortfall, they could have used these banked credits 
to cover, at least a portion, of that shortfall.
    As discussed above, these results provide an estimate, based on 
analysis inputs, of one way General Motors could add fuel-saving 
technologies to its products under the preferred alternative considered 
here, and are not a prediction of what General Motors would do under 
this alternative. In addition, it should be recognized that specific 
results vary among manufacturers and among regulatory alternatives (and 
under different analytical inputs). Still, the example should serve to 
illustrate how the ability to model credit banking can impact results.
(d) Integrating Vehicle Simulation Results Into the Synergy Values
    The CAFE model does not itself evaluate which technologies will be 
available, nor does it evaluate how effective or reliable they will be. 
The technological availability and effectiveness rather, are predefined 
inputs to the model based on the agencies' judgements and not outputs 
from the model, which is simply a tool for calculating the effects of 
combining input assumptions.
    In previous versions of the CAFE Model, technology effectiveness 
values entered into the model as a single number for each technology 
(for each of several classes), intended to represent the incremental 
improvement in fuel consumption achieved by applying that technology to 
a vehicle in a particular class. At a basic level, this implied that 
successive application of new vehicle technologies resulted in an 
improvement in fuel consumption (as a percentage) that was the product 
of the individual incremental effectiveness of each technology applied. 
Since this construction fails to capture interactive effects--cases 
where a given technology either improves or degrades the impact of 
subsequently applied technologies--the CAFE Model applied ``synergy 
factors.'' The synergy factors were defined for a relatively small 
number of technology pairs, and were intended to represent the result 
of physical interactions among pairs of technologies--attempting to 
account for situations where 2 x 2 [ne] 4.
    For a more specific example, for a vehicle with an initial fuel 
consumption of FC0, if two technologies are applied, one 
with an incremental effectiveness of 5 percent, and a second with an 
incremental effectiveness of 10 percent, the effectiveness after the 
application of both technologies without consideration of synergies 
could be expressed as follows:

FC0*(1-.05)*(1-.1)

Which is equivalent to:

FC0*(1-.145)

    This suggests that the combined effectiveness of the two 
technologies is 14.5 percent. The synergy factors aim to correct for 
cases where fuel consumption improvements are not perfectly 
multiplicative, and the combined fuel consumption in the example above 
is either greater than or less than 14.5 percent.

[[Page 73763]]

    For this analysis, the CAFE Model has been modified to accommodate 
the results of the large-scale vehicle simulation study conducted by 
Argonne National Laboratory (described in more detail in the light-duty 
Draft TAR). While Autonomie, Argonne's vehicle simulation model, 
produces absolute fuel consumption values for each simulation record, 
the results have been modified in a way that preserves much of the 
existing structure of the CAFE Model's compliance logic, but still 
faithfully reproduces the totality of the simulation outcomes present 
in the database. Fundamentally, the implementation represents a 
translation of the absolute values in the simulation database into 
incremental improvements and a substantially expanded set of synergy 
factors.
    Since the simulation efforts only included light-duty vehicles, the 
effectiveness values for heavy duty were not integrated into the heavy-
duty fleet; for future rule-makings NHTSA hopes to extend the vehicle 
simulation efforts to include simulations that would be relevant for 
heavy-duty pickups and vans. While the effectiveness values for 
individual technologies remain the same, the synergies between two or 
more technologies incorporate information from Autonomie Argonne's 
light-duty pickup simulations. While these synergy values are not a 
perfect approximation of the interaction of technology applications 
particular to heavy-duty vehicles, it is consistent with what we did in 
the NPRM (where we also used synergy values from light-duty pickups).
    Updating the synergy values to use Argonne's simulation efforts 
does two things: (1) It allows that these synergies may occur between 
more than two technologies, and (2) because the synergies are 
multiplicative, rather than additive, it allows for the consideration 
that the order of other technology applications matter in determining 
the incremental percentage improvement correction of the synergy value. 
Instead of having one additive incremental percentage synergy value for 
a pair of technologies, regardless of the order of technology 
application between these pair of technologies, the synergy values are 
dependent on the initial state and ending point of a vehicle within the 
database.
    As stated, in the past, synergy values in the Volpe model were 
represented as pairs. However, the new values are 7-tuples and there is 
one for every point in the database. The synergy factors are based 
(entirely) on values in the Argonne database, producing one for each 
unique technology combination for each technology class, and are 
calculated as
[GRAPHIC] [TIFF OMITTED] TR25OC16.015

where Sk is the synergy factor for technology combination k, 
FC0 is the fuel consumption of the reference vehicle (in the 
database), xi is the fuel consumption improvement of each 
technology i represented in technology combination k (where some 
technologies are present in combination k, and some are precedent 
technologies that were applied, incrementally, before reaching the 
current state on one of the paths).
    In order to incorporate the results of the Argonne database, while 
still preserving the basic structure of the CAFE model's technology 
module, it was necessary to translate the points in the database into 
locations on the technology tree.\496\ By recognizing that most of the 
paths on the technology tree are unrelated, or separable, it is 
possible to decompose the technology tree into a small number of paths 
and branches by technology type. To achieve this level of linearity, we 
define technology groups--only one of which is new. They are: engine 
cam configuration (CONFIG), engine technologies (ENG), transmission 
technologies (TRANS), electrification (ELEC), mass reduction levels 
(MR), aerodynamic improvements (AERO), and rolling resistance (ROLL). 
The combination of technology levels along each of these paths define a 
unique technology combination that corresponds to a single point in the 
database for each technology class. These technology state definitions 
are more important for defining synergies than for determining 
incremental effectiveness, but the paths are incorporated into both. 
Again, because we did not simulate results applicable to the heavy-duty 
fleet, we did not use the database to define the incremental technology 
effectiveness, but only to adjust for the unique interaction of 
different combinations of technology.
---------------------------------------------------------------------------

    \496\ The technology tree used to create the synergies for this 
rule are presented in the light-duty draft TAR.
---------------------------------------------------------------------------

    As an example, a technology state vector describing a vehicle with 
a SOHC engine, variable valve timing (only), a 6-speed automatic 
transmission, a belt-integrated starter generator, mass reduction 
(level 1), aerodynamic improvements (level 2), and rolling resistance 
(level 1) would be specified as SOHC;VVT;AT6;BISG;MR1;AERO2;ROLL1. Once 
a vehicle is assigned a technology state (one of the tens of thousands 
of unique 7-tuples, defined as CONFIG;ENG;TRANS;ELEC;MR;AERO;ROLL), 
adding a new technology to the vehicle simply represents progress from 
one technology state to another. The vehicle's fuel consumption is:

FCi = FC0 [middot] (1 - FCIi) [middot] SK/0

where FCi is the fuel consumption resulting from the 
application of technology i, FC0 is the vehicle's fuel 
consumption before technology i is applied, FCIi is the 
incremental fuel consumption (percentage) improvement associated with 
technology i, Sk is the synergy factor associated with the 
combination, k, of technologies the vehicle technology i is applied, 
and S0 the synergy factor associated with the technology 
state that produced fuel consumption FC0. The synergy factor 
is defined in a way that captures the incremental improvement of moving 
between points in the database, where each point is defined uniquely as 
a 7-tuple describing its cam configuration, highest engine technology, 
transmission, electrification type, mass reduction level, and level of 
aerodynamic or rolling resistance improvement. For the current heavy-
duty adoption, it is only these synergy values that were used in the 
current analysis. While, like with the individual fuel consumption 
improvements, there is likely not a simple mapping from light-duty 
pickups to heavy-duty pickups (size and power matter), the previous 
synergy values were also an adoption from light-duty pickups. The 
integration of the simulation data allows for a more complete set of 
synergies that account for the order of technology application and the 
interaction of more than two individual technologies.
(e) Updating Mileage Accumulation Schedules
    In order to develop new mileage accumulation schedules for vehicles 
regulated under NHTSA's fuel efficiency and CAFE programs (classes 1-
3), NHTSA purchased a data set of vehicle odometer readings from IHS/
Polk (Polk). Polk collects odometer readings from registered vehicles 
when they encounter maintenance facilities, state inspection programs, 
or interactions with dealerships and OEMs. The (average) odometer 
readings in the data set NHTSA purchased are based on over 74 million 
unique odometer readings across 16 model years (2000-2015) and vehicle 
classes present in the data purchase (all registered vehicles less than 
14,000 lbs. GVW).
    The Polk data provide a measure of the cumulative lifetime vehicle 
miles

[[Page 73764]]

traveled (VMT) for vehicles, at the time of measurement, aggregated by 
the following parameters: make, model, model year, fuel type, drive 
type, door count, and ownership type (commercial or personal). Within 
each of these subcategories they provide the average odometer reading, 
the number of odometer readings in the sample from which Polk 
calculated the averages, and the total number of that subcategory of 
vehicles in operation. From these NHTSA was able to develop new 
estimates of vehicle miles traveled by age as inputs for the CAFE 
Model.
(f) Impact of Vehicle Technology Application Requirements
    Compared to prior analyses of light-duty standards, these model 
changes result in some changes in the broad characteristics of the 
model's application of technology to manufacturers' fleets. Since the 
use of phase-in caps has been de-emphasized and manufacturer technology 
deployment remains tied strongly to estimated product redesign and 
freshening schedules, technology penetration rates may jump more 
quickly as manufacturers apply technology to high-volume products in 
their portfolio.
    By design, restrictions that enforce commonality of mass reduction 
and aerodynamic technologies on variants of a platform, and those that 
enforce engine inheritance, will result in fewer vehicle-technology 
combinations in a manufacturer's future modeled fleet. As explained in 
the NPRM proposing new standards for HD pickups and vans, these 
restrictions are expected to more accurately capture the true costs 
associated with producing and maintaining a product portfolio.
(i) Updated Schedules
    The new medium-duty van/pickup schedule in Figure VI-6 predicts 
higher annual VMT for vehicles between ages one through five years, and 
lower annual VMT for all other vehicle ages, than the old schedule. 
Over the first 30-year span, the new schedule predicts that medium-duty 
vans/pickups drive 24,249 (9 percent) fewer miles than the old 
schedule. We predict the maximum average annual VMT for medium-duty 
vehicles (23,307 miles) at age two. These changes to the schedule will 
have important implications on certain benefits of the standards. More 
monetary fuel savings will occur during the first five years of a 
vehicle's life under the new schedule, but a decrease in fuel savings 
will occur overall while using these schedules. For payback periods 
shorter than 5 years, the new schedule will show shorter payback 
periods than the old schedule. Section 10 of the RIA offers similar 
figures for light-duty vehicles types. It also offers further 
explanation about the shape of the new annual VMT schedule.
[GRAPHIC] [TIFF OMITTED] TR25OC16.016

    Table VI-9 offers a summary of the comparison of lifetime VMT (by 
class) under the new schedule, compared with lifetime VMT under the old 
schedule. In addition to the total lifetime VMT expected under each 
schedule for vehicles that survive to their full useful life, Table VI-
9also shows the survival-weighted lifetime VMT for both schedules. This 
represents the average lifetime VMT for all vehicles, not only those 
that survive to their full useful life. The percentage difference 
between the two schedules is not as stark for the survival-weighted 
schedules: The percentage decrease of survival-weighted lifetime VMT 
under the new schedules range from 6.5 percent (for medium-duty trucks 
and vans) to 21.2 percent (for passenger vans).

[[Page 73765]]



                                       Table VI-9--Summary Comparison of Lifetime VMT of the New and Old Schedules
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                         Survival-Weighted
                                                         -----------------------------------------------------------------------------------------------
                                                                           Lifetime VMT                                    Lifetime VMT
                                                         -----------------------------------------------------------------------------------------------
                                                                New             Old        % difference         New             Old        % difference
--------------------------------------------------------------------------------------------------------------------------------------------------------
Car.....................................................         204,233         301,115            32.2         142,119         179,399            20.8
Van.....................................................         237,623         362,482            34.4         155,115         196,725            21.2
SUV.....................................................         237,623         338,646            29.8         155,115         193,115            19.7
Pickup..................................................         265,849         360,982            26.4         157,991         188,634            16.2
2b/3....................................................         246,413         270,662             9.0         176,807         189,020             6.5
--------------------------------------------------------------------------------------------------------------------------------------------------------

(ii) Data Description
    While the Polk data set contains model-level average odometer 
readings, the CAFE model assigns lifetime VMT schedules at a lower 
resolution based on vehicle body style. For the purposes of VMT 
accounting, the CAFE model classifies every vehicle in the analysis 
fleet as being one of the following: passenger car, SUV, pickup truck, 
passenger van, or medium-duty pickup/van. In order to use the Polk data 
to develop VMT schedules for each of the (VMT) classes in the CAFE 
model, we constructed a mapping between the classification of each 
model in the Polk data and the classes in the CAFE model. The only 
difference between the mapping for the VMT schedules and the rest of 
the CAFE model is that we merged the SUV and van body styles into one 
class (for reasons described in our discussion of the SUV/van schedule 
in Section 10 of the RIA). This mapping allowed us to predict the 
lifetime miles traveled, by the age of a vehicle, for the categories in 
the CAFE model.
    In estimating the VMT models, we weighted each data point (make/
model classification) by the share of each make/model in the total 
population of the corresponding CAFE class. This weighting ensures that 
the predicted odometer readings, by class and model year, represent 
each of vehicle classification among observed vehicles (i.e., the 
vehicles for which Polk has odometer readings), based on each vehicles' 
representation in the registered vehicle population of its class. 
Implicit in this weighting scheme, is the assumption that the samples 
used to calculate each average odometer reading by make, model, and 
model year are representative of the total population of vehicles of 
that type. Several indicators suggest that this is a reasonable 
assumption.
    First, the majority of each vehicle make/model is well-represented 
in the sample. For more than 85 percent of make/model combinations, the 
average odometer readings are collected for 20 percent or more of the 
total population. Most make/model observations have sufficient sample 
sizes, relative to their representation in the vehicle population, to 
produce meaningful average odometer totals at that level.
    We also considered whether the representativeness of the odometer 
sample varies by vehicle age, since VMT schedules in the CAFE model are 
specific to each age. To investigate, we calculated the percentage of 
vehicle types (by make, model, and model year) that did not have 
odometer readings. All model years, apart from 2015, have odometer 
readings for 96 percent or more of the total types of vehicles observed 
in the fleet.
    While the preceding discussion supports the coverage of the 
odometer sample across makes/models by each model year, it is possible 
that, for some of those models, an insufficient number of odometer 
readings is recorded to create an average that is likely to be 
representative of all of those models in operation for a given year. 
For all model years other than 2015, about 95 percent or more of 
vehicles types are represented by at least 5 percent of their 
population. For this reason, we included observations from all model 
years, other than 2015, in the estimation of the new VMT schedules.
    It is possible that the odometer sample is biased. If certain 
vehicles are over-represented in the sample of odometer readings 
relative to the registered vehicle population, a simple average, or 
even one weighted by the number of odometer observations will be 
biased. However, while weighting by the share of each vehicle in the 
population will account for this bias, it would not correct for a 
sample that entirely omits a large number of makes/models within a 
model year. We tested for this by computing the proportion of the count 
of odometer readings for each individual vehicle type--within a class 
and model year--to the total count of readings for that class and model 
year. We also compared the population of each make/model--within each 
class and model year--to the population of the corresponding class and 
model year. The difference of these two ratios shows the difference of 
the representation of a vehicle type--in its respective class and model 
year--in the sample versus the population. All vehicle types are 
represented in the sample within 10 percent of their representation in 
the population, and the variance between the two representations is 
normally distributed. This suggests that, on average, the likelihood 
that a vehicle is in the sample is comparable to its proportion in the 
relevant population, and that there is little under or over sampling of 
certain vehicle makes/models.\497\
---------------------------------------------------------------------------

    \497\ For figures that support the conclusions about the 
representativeness of the IHS/Polk data see Section 10 of the RIA.
---------------------------------------------------------------------------

(iii) Estimation
    Since model years are sold in in the fall of the previous calendar 
year, throughout the same calendar year, and even into the following 
calendar year--not all registered vehicles of a make/model/model year 
will have been registered for at least a year (or more) until age 3. 
The result is that some MY 2014 vehicles may have been driven for 
longer than one year, and some less, at the time the odometer was 
observed. In order to consider this in our definition of age, we assign 
the age of a vehicle to be the difference between the average reading 
date of a make/model and the average first registration date of that 
make/model. The result is that the continuous age variable reflects the 
amount of time that a car has been registered at the time of odometer 
reading, and presumably the time span that the car has accumulated the 
miles.
    After creating the ``Age'' variable, we fit the make/model lifetime 
VMT data points to a weighted quartic polynomial regression of the age 
of the vehicle (stratified by class). The predicted values of the 
quartic regressions are used to calculate the marginal annual VMT by 
age for each class by calculating differences in estimated lifetime 
mileage accumulation by age. However, the Polk data acquired by NHTSA 
only contains

[[Page 73766]]

observations for vehicles newer than 16 years of age. In order to 
estimate the schedule for vehicles older than the age 15 vehicles in 
the Polk data, we combined information about that portion of the 
schedule from the VMT schedules used in both the 2017-2021 Final Light 
Duty Rule and 2019-2025 Medium-Duty NPRM. The light-duty schedules were 
derived from the survey data contained in the 2009 National Household 
Travel Survey (NHTS) and the 2001 Vehicle in Use Survey (VIUS), for 
medium-duty trucks.
    Based on the vehicle ages for which we have data (from the Polk 
purchase), the newly estimated annual schedules differ from the 
previous version in important ways. Perhaps most significantly, the 
annual mileage associated with ages beyond age 8 begin to, and continue 
to, trend much lower. The approach taken here attempts to preserve the 
results obtained through estimation on the Polk observations, while 
leveraging the existing (NHTS-based) schedules to support estimation of 
the higher ages (age 16 and beyond). Since the two schedules are so far 
apart, simply splicing them together would have created not only a 
discontinuity, but also precluded the possibility of a monotonically 
decreasing scale with age (which is consistent with previous schedules, 
the data acquired from Polk, and common sense).
    From the old schedules, we expect that the annual VMT is decreasing 
for all ages. Towards the end of our sample, the predictions for annual 
VMT increase. In order to force the expected monotonicity, we perform a 
triangular smoothing algorithm until the schedule is monotonic. This 
performs a weighted average which weights the observations close to the 
observation more than those farther from it. The result is a monotonic 
function, which predicts similar lifetime VMT for the sample span as 
the original function. Since we do not have data beyond 15 years of 
age, we are not able to correctly capture that part of the annual VMT 
curve using only the new dataset. For this reason, we use trends in the 
old data to extrapolate the new schedule for ages beyond the sample 
range.
    In order to use the VMT information from the newer data source for 
ages outside of the sample, we use the final in-sample age (15 years) 
as a seed and then apply the proportional trend from the old schedules 
to extrapolate the new schedules out to age 30. To do this, we 
calculated the annual percentage difference in VMT of the old schedule 
for ages 15-30. The same annual percentage difference in VMT is applied 
to the new schedule to extend beyond the final in-sample value. This 
assumes that the overall proportional trend in the outer years is 
correctly modeled in the old VMT schedule, and imposes this same trend 
for the outer years of the new schedule. The extrapolated schedules are 
the final input for the VMT schedules in the CAFE model.
(iv) Comparison to Previous Schedules
    The new VMT data suggests that the VMT schedule used in the last 
Light-Duty CAFE Final Rule likely does not represent current annual VMT 
rates. Across all classes, the previous VMT schedules overestimate the 
average annual VMT. The previous schedules are based on data that is 
outdated and self-reported, while the observations from Polk are 
between 5 and 7 years newer than those in the NHTS and represent valid 
odometer readings (rather than self-reported information).
    Additionally, while the NHTS may be a representative sample of 
households, it is less likely to be a representative sample of 
vehicles. However, by properly accounting for vehicle population 
weights in the new averages and models, we corrected for this issue in 
the derivation of the new schedules.
    Insofar as these changes better represent actual VMT, they lead to 
better estimates of actual impacts, such as avoided fuel consumption 
and GHG emissions, safety impacts, and monetized benefits.
(v) Future Direction
    In consultation with other agencies closely involved with VMT 
estimation (e.g., FHWA), NHTSA will continue to seek means to further 
refine estimated mileage accumulation schedules. For example, one 
option under consideration would be to obtain odometer reading data 
from successive calendar years, thus providing a more robust basis to 
consider, for example, the influence of changing fuel prices or 
economic conditions on the accumulation of miles by vehicles of a given 
age.
(g) Updated Analysis Fleet
    For the current analysis we updated the reference fleet from MY 
2014, to the latest available MY 2015. The projection of total sales 
volumes for the Class 2b and 3 market segment was based on the total 
volumes in the 2015 AEO Reference Case. For the purposes of this 
analysis, the AEO2015 calendar year volumes have been used to represent 
the corresponding model-year volumes. While AEO2015 provides enough 
resolution in its projections to separate the volumes for the Class 2b 
and 3 segments, the agencies deferred to the vehicle manufacturers and 
chose to rely on the relative shares present in the pre-model-year 
compliance data.
    The relative sales share by vehicle type (van or pickup truck, in 
this case) was derived from a sales forecast that the agencies 
purchased from IHS Automotive, and applied to the total volumes in the 
AEO2015 projection. Table VI-10 shows the implied shares of the total 
new 2b/3 vehicle market broken down by manufacturer and vehicle type.

                                        Table VI-10--2015 IHS Automotive Market Share Forecast for 2b/3 Vehicles
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                              Model year market share
           Manufacturer                     Style        -----------------------------------------------------------------------------------------------
                                                               2016            2017            2018            2019            2020            2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
Daimler...........................  Van.................              2%              2%              2%              3%              3%              3%
Fiat Chrysler.....................  Van.................               3               3               3               3               3               3
Ford..............................  Van.................              16              16              16              17              18              19
General Motors....................  Van.................               7               7               7               7               8               8
Nissan............................  Van.................               1               1               1               1               2               2
Daimler...........................  Pickup..............               0               0               0               0               0               0
Fiat Chrysler.....................  Pickup..............              14              14              14              14              15              14
Ford..............................  Pickup..............              29              30              31              31              28              28
General Motors....................  Pickup..............              28              27              26              25              24              24
Nissan............................  Pickup..............               0               0               0               0               0               0
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 73767]]

    Within those broadly defined market shares, volumes at the 
manufacturer/model-variant level were constructed by applying the 
model-variant's share of manufacturer sales in the pre-model-year 
compliance data for the relevant vehicle style, and multiplied by the 
total volume estimated for that manufacturer and that style.
(h) Changes to Costs
(i) Use of Retail Price Equivalent (RPE) Multiplier To Calculate 
Indirect Costs
    To produce a unit of output, vehicle manufacturers incur direct and 
indirect costs. Direct costs include cost of materials and labor costs. 
Indirect costs are all the costs associated with producing the unit of 
output that are not direct costs--for example, they may be related to 
production (such as research and development [R&D]), corporate 
operations (such as salaries, pensions, and health care costs for 
corporate staff), or selling (such as transportation, dealer support, 
and marketing). Indirect costs are generally recovered by allocating a 
share of the costs to each unit of good sold. Although it is possible 
to account for direct costs allocated to each unit of good sold, it is 
more challenging to account for indirect costs allocated to a unit of 
goods sold. To make a cost analysis process more feasible, markup 
factors, which relate total indirect costs to total direct costs, have 
been developed. These factors are often referred to as retail price 
equivalent (RPE) multipliers.
    Cost analysts and regulatory agencies (including both NHTSA and 
EPA) have frequently used these multipliers to predict the resultant 
impact on costs associated with manufacturers' responses to regulatory 
requirements. The best approach, if it were possible, to determining 
the impact of changes in direct manufacturing costs on a manufacturer's 
indirect costs would be to actually estimate the cost impact on each 
indirect cost element. However, doing this within the constraints of an 
agency's time or budget is not always feasible, and the technical, 
financial, and accounting information to carry out such an analysis may 
simply be unavailable.
    The one empirically derived metric that addresses the markup of 
direct costs to consumer costs is the RPE multiplier, which is measured 
from manufacturer 10-K accounting statements filed with the Securities 
and Exchange Commission. Over roughly a three decade period, the 
measured RPE has been remarkably stable, averaging 1.5, with minor 
annual variation. The National Research Council notes that, ``Based on 
available data, a reasonable RPE multiplier would be 1.5.'' The 
historical trend in the RPE is illustrated in Figure VI.13.
[GRAPHIC] [TIFF OMITTED] TR25OC16.017

    RPE multipliers provide, at an aggregate level, the relationship 
between revenue and direct manufacturing costs. They are measured by 
dividing total revenue by direct costs. However, because this provides 
only a single aggregate measure, using RPE multipliers results in the 
application of a common incremental markup to all technologies. It 
assures that the aggregate cost impact across all technologies is 
consistent with empirical data, but does not allow for indirect cost 
discrimination among different technologies. Thus, a concern in using 
the RPE multiplier in cost analysis for new technologies added in 
response to regulatory requirements is that the indirect costs of 
vehicle modifications are not likely to be the same for all different 
technologies. For example, less complex technologies could require 
fewer R&D efforts or less warranty coverage than more complex 
technologies. In addition, some simple technological adjustments may, 
for example, have no effect on the number of corporate personnel and 
the indirect costs attributable to those personnel. The use of RPEs, 
with their assumption that all technologies have the same proportion of 
indirect costs, is likely to overestimate the costs of less complex 
technologies and underestimate the costs of more complex technologies. 
However, for regulations such as the CAFE and GHG emission standards 
under consideration, which drive changes to nearly every vehicle 
system, overall average indirect costs should align with the RPE value. 
Applying RPE to the cost for each technology assures that alignment.
    Modified multipliers have been developed by EPA, working with a

[[Page 73768]]

contractor, for use in rulemakings.\498\ These multipliers are referred 
to as indirect cost multipliers (or ICMs). ICMs assign unique 
incremental changes to each indirect cost contributor at several 
different technology levels.
---------------------------------------------------------------------------

    \498\ RTI International, ``Automobile Industry Retail Price 
Equivalent and Indirect Cost Multipliers,'' February 2009; EPA-420-
R-09-003; http://www3.epa.gov/otaq/ld-hwy/420r09003.pdf.

---------------------------------------------------------------------------
ICM = (direct cost + adjusted indirect cost)/(direct cost)

    Developing the ICMs from the RPE multipliers requires developing 
adjustment factors based on the complexity of the technology and the 
time frame under consideration: The less complex a technology, the 
lower its ICM, and the longer the time frame for applying the 
technology, the lower the ICM. This methodology was used in the cost 
estimation for the recent light-duty MYs 2012-2016 and MYs 2017-2025 
rulemaking and for the heavy-duty MYs 2014-2018 rulemaking. The ICMs 
for the light-duty context were developed in a peer-reviewed report 
from RTI International and were subsequently discussed in a peer-
reviewed journal article.\499\ Importantly, since publication of that 
peer-reviewed journal article, the agencies have revised the 
methodology to include a return on capital (i.e., profits) based on the 
assumption implicit in ICMs (and RPEs) that capital costs are 
proportional to direct costs, and businesses need to be able to earn 
returns on their investments.
---------------------------------------------------------------------------

    \499\ Rogozhin, A., et al., ``Using indirect cost multipliers to 
estimate the total cost of adding new technology in the automobile 
industry,'' International Journal of Production Economics (2009), 
doi:10.1016/j.ijpe.2009.11.031.
---------------------------------------------------------------------------

    Since their original development in February 2009, the agencies 
have made some changes to both the ICMs factors and to the method of 
applying those factors relative to the factors developed by RTI and 
presented in their reports. We have described and explained those 
changes in several rulemakings over the years, most notably the 2017-
2025 FRM for light vehicles and the more recent Heavy-duty GHG Phase 2 
NPRM.\500\ In the 2015 NAS study, the committee stated a conceptual 
agreement with the ICM method since ICM takes into account design 
challenges and the activities required to implement each technology. 
However, although endorsing ICMs as a concept, the NAS Committee stated 
that ``. . . the empirical basis for such multipliers is still lacking, 
and, since their application depends on expert judgment, it is not 
possible to determine whether the Agencies' ICMs are accurate or not.'' 
NAS also states that ``. . . the specific values for the ICMs are 
critical since they may affect the overall estimates of costs and 
benefits for the overall standards and the cost effectiveness of the 
individual technologies.'' The committee did encourage continued 
research into ICMs given the lack of empirical data for them to 
evaluate the ICMs used by the agencies in past analyses. EPA, for its 
part, continues to study the issue surrounding ICMs but has not pursued 
further efforts given resource constraints and demands in areas such as 
technology benchmarking and cost teardowns.
---------------------------------------------------------------------------

    \500\ 80 FR 40137.
---------------------------------------------------------------------------

    On balance, NHTSA believes that the empirically derived RPE is a 
more reliable basis for estimating indirect costs. To ensure overall 
indirect costs in the analysis align with the RPE value, NHTSA has 
developed its primary analysis based on applying the RPE value of 1.5 
to each technology. NHTSA also has conducted a sensitivity analysis 
examining the impact of applying the ICM approach in the sensitivity 
analysis portion later in this Section. This marks a change from the 
NPRM where we use the ICM multiplier to calculate indirect costs as the 
central analysis and the RPE multiplier as a sensitivity case.
(ii) Updates to Mass Reduction Based on 2014 Silverado Study
    As proposed in the NPRM we have updated the HD pickup and van mass 
reduction cost curves with a MY 2014 GMC Silverado EDAG study. The 
updated mass reduction study suggests that mass reduction will be more 
costly for heavy-duty vans and pickups than was suggested in the NPRM. 
This can explain the reduction in mass reduction in the current 
analysis compared to the NPRM.
    NHTSA awarded a contract to EDAG to conduct a vehicle weight 
reduction feasibility and cost study of a 2014MY full size pick-up 
truck. The light weighted version of the full size pick-up truck (LWT) 
used manufacturing processes that will likely be available during the 
model years 2025-2030 and be capable of high volume production. The 
goal was to determine the maximum feasible weight reduction while 
maintaining the same vehicle functionalities, such as towing, hauling, 
performance, noise, vibration, harshness, safety, and crash rating, as 
the baseline vehicle, as well as the functionality and capability of 
designs to meet the needs of sharing components across same or cross 
vehicle platform. Consideration was also given to the sharing of 
engines and other components with vehicles built on other platforms to 
achieve manufacturing economies of scale, and in recognition of 
resource constraints which limit the ability to optimize every 
component for every vehicle.
    A comprehensive teardown/benchmarking of the baseline vehicle was 
conducted for the engineering analysis. The analysis included geometric 
optimization of load bearing vehicle structures, advanced material 
utilization along with a manufacturing technology assessment that would 
be available in the 2017 to 2025 time frame. The baseline vehicle's 
overall mass, center of gravity and all key dimensions were determined. 
Before the vehicle teardown, laboratory torsional stiffness tests, 
bending stiffness tests and normal modes of vibration tests were 
performed on baseline vehicles so that these results could be compared 
with the CAE model of the light weighted design. After conducting a 
full tear down and benchmarking of the baseline vehicle, a detailed CAE 
model of the baseline vehicle was created and correlated with the 
available crash test results. The project team then used computer 
modeling and optimization techniques to design the light-weighted 
pickup truck and optimized the vehicle structure considering redesign 
of structural geometry, material grade and material gauge to achieve 
the maximum amount of mass reduction while achieving comparable vehicle 
performance as the baseline vehicle. Only technologies and materials 
projected to be available for large scale production and available 
within two to three design generations (e.g. model years 2020, 2025 and 
2030) were chosen for the LWT design. Three design concepts were 
evaluated: (1) A multi-material approach; (2) an aluminum intensive 
approach; and (3) a Carbon Fiber Reinforced Plastics approach. The 
multi-material approach was identified as the most cost effective. The 
recommended materials (advanced high strength steels, aluminum, 
magnesium and plastics), manufacturing processes, (stamping, hot 
stamping, die casting, extrusions, and roll forming) and assembly 
methods (spot welding, laser welding, riveting and adhesive bonding) 
are currently used, although some to a lesser degree than others. These 
technologies can be fully developed within the normal product design 
cycle using the current design and development methods.
    The design of the LWT was verified, through CAE modeling, that it 
meets all relevant crash tests performance. The LS-DYNA finite element 
software used by the EDAG team is an industry standard for crash 
simulation and modeling. The researchers modeled the crashworthiness of 
the LWT design

[[Page 73769]]

using the NCAP Frontal, Lateral Moving Deformable Barrier, and Lateral 
Pole tests, along with the IIHS Roof, Lateral Moving Deformable 
Barrier, and Frontal Offset (40 percent and 25 percent) tests. All of 
the modeled tests were comparable to the actual crash tests performed 
on the 2014 Silverado in the NHTSA database. Furthermore, the FMVSS No. 
301 rear impact test was modeled and it showed no damage to the fuel 
system.
    The baseline 2014 MY Chevrolet Silverado's platform shares 
components across several platforms. Some of the chassis components and 
other structural components were designed to accommodate platform 
derivatives, similar to the components in the baseline vehicle which 
are shared across platforms such as GMT 920 (GM Tahoe, Cadillac 
Escalade, GMC Yukon), GMT 930 platform (Chevy Suburban, Cadillac 
Escalade ESV, GMC Yukon XL), and GMT 940 platform (Chevy Avalanche and 
Cadillac Escalade EXT) and GMT 900 platform (GMC Sierra). As per the 
National Academy of Science's guidelines, the study assumes engines 
would be downsized or redesigned for mass reduction levels at or 
greater than 10 percent. As a consequence of mass reduction, several of 
the components used designs that were developed for other vehicles in 
the weight category of light-weighted designed vehicles were used to 
maximize economies of scale and resource limitations. Examples include 
brake systems, fuel tanks, fuel lines, exhaust systems, wheels, and 
other components.
    Cost is a key consideration when vehicle manufacturers decide which 
fuel-saving technology to apply to a vehicle. Incremental cost analysis 
for all of the new technologies applied to reduce mass of the light-
duty full-size pickup truck designed were calculated. The cost 
estimates include variable costs as well as non-variable costs, such as 
the manufacturer's investment cost for tooling. The cost estimates 
include all the costs directly related to manufacturing the components. 
For example, for a stamped sheet metal part, the cost models estimate 
the costs for each of the operations involved in the manufacturing 
process, starting from blanking the steel from coil through the final 
stamping operation to fabricate the component. The final estimated 
total manufacturing cost and assembly cost are a sum total of all the 
respective cost elements including the costs for material, tooling, 
equipment, direct labor, energy, building and maintenance.
    The information from the LWT design study was used to develop a 
cost curve representing cost effective full vehicle solutions for a 
wide range of mass reduction levels. At lower levels of mass reduction, 
non-structural components and aluminum closures provide weight 
reduction which can be incorporated independently without the redesign 
of other components and are stand-alone solutions for the LWV. The 
holistic vehicle design using a combination of AHSS and aluminum 
provides good levels of mass reduction at reasonably acceptable cost. 
The LWV solution achieves 17.6 percent mass reduction from the baseline 
curb mass. Further two more analytical mass reduction solutions (all 
aluminum and all carbon fiber reinforced plastics (CFRP)) were 
developed to show additional mass reduction that could be potentially 
achieved beyond the LWV mass reduction solution point. The aluminum 
analytical solution predominantly uses aluminum including chassis frame 
and other components. The carbon fiber reinforced plastics analytical 
solution predominantly uses CFRP in many of the components. The CFRP 
analytical solution shows higher level of mass reduction but at very 
high costs. Note here that both all-Aluminum and all CFRP mass 
reduction solutions are analytical solutions only and no computational 
models were developed to examine all the performance metrics.
    An analysis was also conducted to examine the cost sensitivity of 
major vehicle systems to material cost and production volume 
variations.
    Table VI-11 lists the components included in the various levels of 
mass reduction for the LWV solution. The components are incorporated in 
a progression based on cost effectiveness.

                     Table VI-11--Components Included for Different Levels of Mass Reduction
----------------------------------------------------------------------------------------------------------------
                                                    Cumulative
            Vehicle component/system                mass saving    Cumulative MR    Cumulative      Cumulative
                                                       (kg)             (%)          cost  ($)     cost  ($/kg)
----------------------------------------------------------------------------------------------------------------
Interior Electrical Wiring......................            1.38           0.06%         (28.07)          -20.34
Headliner.......................................            1.56            0.06         (29.00)          -18.59
Trim--Plastic...................................            2.59            0.11         (34.30)          -13.24
Trim--misc......................................            4.32            0.18         (43.19)          -10.00
Floor Covering..................................            4.81            0.20         (45.69)           -9.50
Headlamps.......................................            6.35            0.26         (45.69)           -7.20
HVAC System.....................................            8.06            0.33         (45.69)           -5.67
Tail Lamps......................................            8.46            0.35         (45.69)           -5.40
Chassis Frame...................................           54.82            2.25            2.57            0.05
Front Bumper....................................           59.93            2.46            7.89            0.13
Rear Bumper.....................................           62.96            2.59           11.04            0.18
Towing Hitch....................................           65.93            2.71           14.13            0.21
Rear Doors......................................              77            3.17           28.09            0.36
Wheels..........................................          102.25            4.20           68.89            0.67
Front Doors.....................................          116.66            4.80           92.53            0.79
Fenders.........................................          128.32            5.28          134.87            1.05
Front/Rear Seat & Console.......................          157.56            6.48          272.57            1.73
Steering Column Assy............................          160.78            6.61          287.90            1.79
Pickup Box......................................          204.74            8.42          498.35            2.43
Tailgate........................................          213.14            8.76          538.55            2.53
Instrument Panel................................          218.66            8.99          565.06            2.58
Instrument Panel Plastic Parts..................          221.57            9.11          580.49            2.62
Cab.............................................          304.97           12.54        1,047.35            3.43
Radiator Support................................          310.87           12.78        1,095.34            3.52
Powertrain......................................          425.82           17.51         1246.68            2.93
----------------------------------------------------------------------------------------------------------------


[[Page 73770]]

    A fitted curve was developed based on the above listed mass 
reduction points to derive cost per kilogram at distinct mass reduction 
points. The current curve shows costs per kilogram approximately six 
times as expensive for 5 percent mass reduction (MR1) than in the NPRM, 
and approximately twice as expensive per kilogram for 7.5 percent mass 
reduction (MR2), which explains the reduction in mass reduction in the 
current analysis relative to the NPRM.

D. NHTSA CAFE Model Analysis of the Regulatory Alternatives for HD 
Pickups and Vans: Method A

    EPCA and EISA require NHTSA to ``implement a commercial medium- and 
heavy-duty on-highway vehicle and work truck fuel efficiency 
improvement program designed to achieve the maximum feasible 
improvement'' and to establish corresponding fuel consumption standards 
``that are appropriate, cost-effective, and technologically feasible.'' 
\501\ For both the NPRM and the current analysis of potential standards 
for HD pickups and vans, NHTSA applied NHTSA's CAFE Compliance and 
Effects Modeling System (sometimes referred to as ``the CAFE model'' or 
``the Volpe model'') to aid in determination of the maximally feasible 
standards. The subsequent analysis, referred to as ``Method A,'' 
includes several updates to the model and to accompanying inputs, as 
discussed above in section 6.C. The ``Method A'' results are used as 
the primary basis for NHTSA's final determination of the suitability of 
the Phase 2 standards. Further discussion of the determination are 
provided after the discussion of the ``Method A'' modeling results in 
Section 6.C.(9) of this document.
---------------------------------------------------------------------------

    \501\ 49 U.S.C. 32902(k)(2).
---------------------------------------------------------------------------

(1) Baseline Costs Across Manufacturers
    As in the NPRM, the main analysis of Method A considers costs, 
benefits and other effects of regulatory alternatives relative to the 
dynamic baseline--or a baseline which assumes that manufacturers will 
apply all technologies with associated cost that pays back from retail-
priced fuel savings within 6 months of purchase. The assumption is that 
consumers are willing to pay additional technology costs that return in 
fuel savings within 6-months of purchase, and that as a result, 
manufacturers will adopt these technologies regardless of fuel 
efficiency standards. We considered alternative runs with voluntary 
overcompliance of technologies with a payback period of 0-months 
(manufacturers will not voluntarily overcomply if there is a cost 
associated with a technology), 12-months, 18-months, and 24-months in 
the sensitivity analysis.
    Before considering the effects of increases in the standards, it is 
important to discuss the baseline costs. These costs are assumed to be 
incurred even if no additional regulatory action is taken to increase 
standards beyond the existing MY 2018 standards. Table VI-12 shows the 
baseline average and total technology costs for each manufacturer in 
the heavy duty market, and for the heavy duty industry as a whole for 
the MY 2021 fleet (cost increases relative to the MY 2015 fleet). The 
updated CAFE model suggests that under no further increasses to 
stringency beyond MY 2018, manufacturers would spend $136 million--an 
industry average of $180 per vehicle--on technologies that improve fuel 
economy in MY 2021. The additonal baseline costs are not distributed 
across all manufacturers proportional to their fleet size. The average 
technology costs of an individual manufacturer fleet range from $80 per 
vehicle for Fiat/Chrysler to $350 per vehicle for General Motors. In 
order to explain this heterogeneity it is important to consider the 
sources of increased technology costs: compliance actions, inheritance 
from heavy duty vehicles, spillover inheritance from the light-duty 
vehicles, and voluntary overcompliance.

            Table VI-12--MY 2021 Costs (2013$) Under Alternative 1b (Central Baseline) for 2b3 Market
----------------------------------------------------------------------------------------------------------------
                                                    Average per        Total       Estimated  MY
                                                      vehicle       technology      2015  fuel     Estimated  MY
                  Manufacturer                      technology     cost (million  consumption (g/ 2018  standard
                                                   cost (2013$)       2013$)          100 mi)       (g/100 mi)
----------------------------------------------------------------------------------------------------------------
Daimler.........................................             150               3            4.50            4.84
FCA.............................................              80              10            6.23            5.95
Ford............................................              90              33            6.00            5.76
GM..............................................             350              86            6.52            5.94
Nissan..........................................             230               3            6.01            5.63
Industry........................................             180             136            6.18            5.83
----------------------------------------------------------------------------------------------------------------

    One reason manufacturers incur technology costs in the baseline for 
MY 2021 vehicles is to achieve compliance with Phase 1 standards, which 
end their stringency increases in MY 2018. Manufacturers will have 
different standards and different starting positions relative to these 
standards. In order to indicate which manufacturers make compliance 
actions which increase their baseline technology costs, Table VI-12 
includes the MY 2015 estimated average fuel consumption and the 
estimated MY 2018 fuel consumption standard--manufacturers with higher 
average fuel consumption in MY 2015 than the estimated MY 2018 fuel 
consumption standard, will apply technology costs to comply with the 
final MY 2018 standards. The fuel consumption standards are determined 
by setting work factor based targets and computing the manufacturer's 
sales-weighted average of these targets. While the individual vehicle 
targets based on work factor are the same for all vehicles of the same 
work factor for model years 2018 and beyond, the overall fuel 
efficiency standard for a manufacturer may change from model year to 
model year with changes to the work factors of individual vehicle 
models, as well as changes in relative production volumes of each 
vehicle model. The model does not capture all means by which a 
manufacturer's average fuel efficiency standard may change under the MY 
2018 attribute-based standards, but does capture changes to work 
factor--and therefore individual vehicle targets--due to application of 
mass reduction. The model also predicts changes to the fleet mix of 
each manufacturer using inputs created from AEO2015 and 2015 IHS/Polk 
production projections. The

[[Page 73771]]

technology cost for a manufacturer to meet MY 2018 standards is 
primarily driven by the fuel consumption gap between the MY 2015 
(baseline) compliance level and the 2018 standard. From Table VI.4 it 
can be seen that only Daimler meets its most-stringent fuel consumption 
standard in 2015 and does not have to apply technology in the baseline 
to comply with Phase 1 standards.
    A second source of technology costs is from inheritance; vehicles 
with shared platforms are assumed to inherit technologies applied to 
the platform leader at their next redesign or refresh to avoid creating 
a new body or engine platform,\502\ even if these actions are no longer 
necessary to reach compliance. Manufacturers produce a limited set of 
engine and body platforms as a strategy to reduce their costs; there is 
no reason to indicate they will modify this strategy to comply with 
standards, for this reason this is an important constraint in the CAFE 
model. A similar source of technology costs are costs associated with 
spillover from the light-duty MY 2017-2021 standards. Regulatory 
agencies distinctly define the heavy duty and light duty classes, but 
from the manufacturer perspective these classes are not clearly 
delineated. They share some engine and body platforms across regulatory 
classes, and sometimes the most cost-effective choice to comply with 
standards will involve making changes to these shared platforms. 
Comments in the NPRM recommended that we run the model with the ability 
to capture this spillover effect between the light-duty and heavy-duty 
fleets--in response to these comments, in the current analysis we run 
the two fleets together with all existing standards from the light-duty 
fleet included for all scenarios. Since the MY 2017-2021 light-duty 
CAFE standards are final, these and their effects are included in the 
baseline of the model--they will be in effect whether or not additional 
action is taken with heavy-duty standards. While we have included the 
ability for the standards from one fleet to affect the other, our 
modeling has shown that the spilloever effect from the light-duty fleet 
into the heavy-duty fleet, and from the heavy-duty fleet into the 
light-duty fleet is small. We hope to further develop the model's 
ability to capture the spillover effects in future versions of the 
model.
---------------------------------------------------------------------------

    \502\ For a more complete discussion of inheritance in the model 
see Chapter 6, Section C.
---------------------------------------------------------------------------

    The final way that manufacturers might accrue additional technology 
costs in the MY 2021 dynamic baseline scenario is through voluntary 
overcompliance. As already discussed: In the baseline case of the 
central analysis it is assumed that manufacturers will apply 
technologies which payback in fuel savings within 6 months of 
operation, regardless of whether or not the standards increase in 
stringency. Depending on the existing technologies and vehicles in a 
manufacturer's fleet, they may voluntarily overcomply by adding 
different technologies, or none at all.
    The MY 2021 costs of the dynamic baseline scenario are lower in the 
updated analysis than they were in the NPRM for all manufacturers other 
than Nissan and Daimler. The average technology costs across the 
industry are less than half the NPRM costs--dropping from $440/vehicle 
to $180/vehicle. The largest drop in average costs across the 
manufacturers is for GM; their costs dropped from $780/vehicle to $350/
vehicle. The modeled costs for Nissan dropped from $280 to $230, and 
for FCA, from $280 to $80.
    While considering MY 2021 allows for comparision to the NPRM 
analysis, not all baseline costs are incurred in MY 2021. Figure VI-
8shows the baseline total technology costs, andFigure VI-9, the average 
technology costs, by manufacturer for all model years. Like the NPRM 
analysis assumes manufacturers will likely apply most technologies as 
part of vehicle redesign or freshening; as a result their technology 
application comes in discrete blocks. GM applies $20 million in total 
technolgy for their MY 2016 fleet, and an additional $60 million in for 
MY 2018--their total technology costs vary slightly after this point 
with the projection of their fleet size and with the effects of 
technology learning. Similarly, Ford applies $30 million for MY 2017 
and an additional $80 million in 2027. Chrysler/Fiat, Daimler, and 
Nissan apply technology in only one year--Chrysler/Fiat applies $11 
million in MY 2018, Daimler $3 million for MY 2020, and Nissan $3 
million for MY 2021. While the total technology costs vary between 
manufacturers, the per-vehicle baseline costs range between $0-350 for 
all manufacturers and model years.

[[Page 73772]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.018

(2) Relevant Model Updates
    There are changes to model that help explain the decrease in 
baseline technology costs for the current analysis. The current 
analysis uses the synergies simulated by Argonne for the light-duty 
fleet, while the NPRM analysis uses a limited set of synergy values 
(also initially estimated for the light-duty fleet. The changes in 
these synergy factors could impact which technologies are chosen, and 
how effective the model calculates them to

[[Page 73773]]

be.\503\ Changes to the model input costs from the NPRM to the current 
analysis could also change which technologies get picked by the model, 
and the projected costs. One of the major changes to costs is a switch 
from the ICM cost mark-up methodology used in the NPRM to the RPE cost 
mark-up methodology of the current analysis.\504\ A more specific 
change to the input costs is a change to the mass reduction curve to be 
based off of the newer 2014 Silverado study, which suggests that 5 
percent and 10 percent mass reduction is significantly more expensive 
than was assumed in the NPRM.\505\
---------------------------------------------------------------------------

    \503\ For a more complete discussion of the changes to the 
Argonne simulation synergies see Chapter 6, Section C.
    \504\ For further discussion on the switch from ICM to RPE for 
the final analysis see Chapter 6, Section C.
    \505\ More discussion of the change in mass reduction curves is 
present in Chapter 6, Section C.
---------------------------------------------------------------------------

    The final major input change is that the current model uses the 
2015 fleet as its reference point, while the NPRM uses the 2014 fleet. 
This affects the starting point of each manufacturer in the model, and 
could change their predicted standard (through changes in sales mix and 
work factor). In order to consider the impacts of using the 2015 
reference fleet it is helpful to consider the sales-weighted fuel 
economy and work factor distributions across the two reference fleets.
    Figure VI-10 shows the sales-weighted empirical cumulative 
distribution function (CDF) for GM's work factor and fuel economy for 
the two reference fleets. The dashed line shows the values for the 2014 
reference fleet, and the solid, for the 2015 reference fleet. The y-
axis shows the cumulative share of the manufacturer's fleet against the 
two measures. For GM, the work factor CDF shifted to the right for work 
factors between 3500 and 5500, suggesting that the proportion of the 
fleet with work factors in this range increased in the GM fleet. Since 
increases in work factor will decrease the target value for individual 
vehicles, this average change in work factor decreases GM's initial 
CAFE standard.
    It should also be noted that some methods of increasing work factor 
(mainly, decreasing curb weight) can increase the fuel efficiency of a 
vehicle, while others (increasing the power) can decrease fuel 
efficiency. The empirical CDF for GM's sales-weighted fuel consumption 
shows GM's 2015 fleet as having more vehicles with fuel consumption 
below 6.3 gal/100 mi, fewer with fuel consumption around 6.3 gal/100 
mi, significantly more vehicles with fuel consumption around 7.0 gal/
100 mi. The average fuel consumption of GM's 2014 fleet was 6.27 gal/
100 mi, where the average fuel consumption of GM's 2015 fleet is 6.52 
gal/100 mi. The overall increase in GM's average fuel consumption 
diminishes the effect of the increase in work factor from MY 2014 to MY 
2015 at improving their starting position in MY 2015 relative to MY 
2014--their MY 2015 standard using the 2014 fleet was 6.36, and using 
the 2014 fleet and is 6.59. Considering this, their initial shortfall 
is about the same using either reference fleet.
[GRAPHIC] [TIFF OMITTED] TR25OC16.019

    Figure VI-11 shows the same for Ford. There is a similar pattern of 
a higher proportion of heavy duty vehicles in Ford's fleet with work 
factors between 3500 and 5000. This will decrease Ford's initial 
standard in the model. Ford also shows a decrease in the proportion of 
heavy duty vehicles with higher fuel consumption, which will result in 
an overall lower fuel consumption for the 2015 fleet. The result is 
that Ford will start with a lower standard by using the 2015 fleet 
rather than the 2014 fleet, and start with a higher fuel efficiency 
level--both of which will work in the same direction to decrease Ford's 
shortfall to MY 2018 standards. This suggests that Ford will not need 
to apply as much technology to comply, and helps to explain their lower 
baseline technology costs in the current analysis.

[[Page 73774]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.020

    Figure VI-12 shows the cumulative distribution function for the 
work factor of Fiat/Chrysler. Although there is some increase in the 
left tail of the distribution of FCA's work factor for MY 2015 relative 
to MY 2014, it is smaller than for the Ford and GM fleets. The CDF of 
fuel efficiency also shows that Fiat/Chrysler shows nearly identical 
distribution of fuel consumption between the 2014 and 2015 fleets. 
These two factors combine to explain why Fiat/Chrysler did not show 
increases in costs from the NPRM to the current analysis--they did not 
have as much of a change in shortfall to MY 2018 standards as both GM 
and Ford.
[GRAPHIC] [TIFF OMITTED] TR25OC16.021

    Figure VI-13 shows the same empirical distribution functions for 
Nissan. Both the distribution of work factor and fuel consumption are 
comparable for Nissan's 2014 and 2015 fleets. This helps explain the 
small change in Nissan's baseline costs between the two analyses.

[[Page 73775]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.022

    Figure VI-14 shows the cumulative distribution function for work 
factor and fuel consumption for Daimler for both the 2014 and 2015 
fleets. The distribution of work factor shifted right for work factors 
above 3500. The fuel consumption curve shifted right for all fuel 
consumptions. This suggests that Daimler will face a lower standard 
using the 2015 reference fleet, but that they may also start with a 
lower initial fuel efficiency level. The change to the 2015 reference 
fleet does not have clear implications on the relative starting point 
of Daimler in the analysis relative to the NPRM analysis.
[GRAPHIC] [TIFF OMITTED] TR25OC16.023

(3) Industry-Level Results of Regulatory Alternatives
    Table VI-13, below, summarizes the stringency of standards, the 
estimated required fuel efficiency the estimated achieved fuel 
efficiency, as well as the impacts of each alternative for the overall 
industry for MY 2030. Using the updated fleet and analysis, the MY 2030 
stringency is slightly less that in the NPRM (4.91 gallons/100 mile in 
today's analysis compared to 4.86 gallons/100 mile in the NPRM for the 
preferred alternative). As has been noted, the standards are set based 
in part on the work factor of vehicles; by changing the average work 
factor of their fleet, manufacturers can change the average stringency 
of their standard. While the model does not simulate changes to work 
factor which would increase the

[[Page 73776]]

power or GVWR, it does simulate changes in work factor due to mass 
reduction. By lowering the curb weight and holding power constant, 
manufacturers can increase the payload of a vehicle; since payload is a 
component in calculating the work factor, by lowering curb weight 
manufacturers can increase their work factor for a vehicle model and 
reduce its target. However, the average absolute and proportional curb 
weight reduction in the current analysis is less than it was in the 
NPRM analysis across all alternatives, which can be explained by the 
higher mass reduction costs under the current curve. This suggests that 
the change in the average overall industry standard in today's analysis 
is likely due in major part to changes in the work factor between the 
2014 and 2015 reference fleet, and not to changes in the work factor 
simulated within the model runs.

              Table VI-13--Summary of Impacts on the MY 2030 HD Industry Fleet (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                         Alternative                               2            3            4            5
----------------------------------------------------------------------------------------------------------------
                                             Stringency of Standards
----------------------------------------------------------------------------------------------------------------
Annual Increase in Stringency Beginning in MY 2021..........         2.0%         2.5%         3.5%         4.0%
Increases Until.............................................      MY 2025      MY 2027      MY 2025      MY 2025
Total Increase in MY 2030 Stringency Relative to Final Phase         9.6%        15.6%        15.6%        17.9%
 1 Standards \a\............................................
----------------------------------------------------------------------------------------------------------------
                                Estimated Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.........................................        19.03        20.37        20.38        20.95
Achieved in MY 2030.........................................        19.20        20.47        20.45        20.98
----------------------------------------------------------------------------------------------------------------
                                  Average Fuel Consumption (gallons/100 miles)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.........................................         5.25         4.91         4.91         4.77
Achieved in MY 2030.........................................         5.21         4.88         4.89         4.77
----------------------------------------------------------------------------------------------------------------
                           Estimated Average Greenhouse Gas Emissions (grams per mile)
----------------------------------------------------------------------------------------------------------------
CO[ihel2] Required in MY 2030...............................          494          462          462          450
CO[ihel2] Achieved in MY 2030...............................          490          460          460          449
----------------------------------------------------------------------------------------------------------------
                                   Technology Penetration in MY 2030 (percent)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..............................................           56           56           56           56
Cylinder Deactivation.......................................            4            4            4            4
Direct Injection Engine.....................................           17           27           26           29
Turbo Charged Engine........................................           59           69           68           68
8 Speed Auto. Trans.........................................           77           95           94           95
EPS, Accessories............................................           52           80           80           96
12V Stop-start..............................................            0            0            3           11
Strong Hybrid...............................................            0            2            2            7
Aero. Improvements..........................................           46           80           80           98
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Mass Reduction (lb.)........................................           28          240           24          289
Mass Reduction (percent of curb weight).....................         0.43          3.6          3.7          4.3
----------------------------------------------------------------------------------------------------------------
                                        Technology Costs (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Average Vehicle ($).........................................         $500        $1470        $1480        $1890
Payback Period (m) \b\......................................           19           30           31           33
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ This increase in stringency is based on the estimated percentage change in fuel consumption (gal/100mi)
  stringency projected by the model for the MY 2030 fleet under the final Phase 2 standards relative to the
  continuation of Phase 1 standards. Note that if manufacturers' have applied mass reduction to an individual
  vehicle model in the CAF[Eacute] model that this will increase the work factor of that vehicle in the model,
  and make the individual target less stringent. Thus, where any mass reduction is applied in the model, the
  total increase in stringency of the fleet presented here will be lower than the total stringency increase of
  the fleet if no mass reduction were applied.
\b\ Here payback period is calculated using estimated undiscounted retail fuel savings and the initial
  technology costs for MY 2030.

    Today's Method A analysis using the updated version of the CAFE 
model and updated inputs shows that regulatory Alternatives 3 and 4 
could be met with a small application of strong (P2) HEVs. However, 
Alternative 5 could be met with the considerably greater application of 
strong HEVs. Although there is some increase in the penetration rates 
between alternatives as stringency increases, the current analysis 
suggests that under all alternatives, nearly all of the MY 2030 heavy-
duty fleet could use 8-speed transmissions, VVT/VVL improvements and 
turbo-charged engines with application across more than half of the 
fleet, direct injection could be present in a quarter of the fleet, and 
cylinder deactivation could play a minor part in the HD fleet. EPS and 
improved electrical accessories vary more between alternatives; present 
in 52 percent of the fleet in Alterative 2, 80 percent in Alternatives 
3 and 4, and 96 percent in Alternative 5. Aerodynamic improvements and 
mass reduction follow a similar pattern; with a larger penetration of 
these technologies with Alternative 3 than with Alternative 2, a 
similar penetration under Alternatives 3

[[Page 73777]]

and 4, and a higher in penetration in Alternative 5.
    A way to measure the cost-effectiveness of the technologies on 
consumers is to look at the payback period. In this context, the 
payback period is defined as the number of months of driving it will 
take a consumer to earn back the increased technology costs by the 
amount they save in fuel by driving a more fuel efficient vehicle. 
Under the current analysis, the average additional technology cost will 
payback in fuel savings in under 17 months for Alternative 2, 27 months 
for Alternatives 3 and 4, and 30 months for Alternative 5. It is 
important to note that there are inputs other than the cost and 
effectiveness of technologies which could affect the payback period; 
the fuel prices and mileage accumulation schedules will affect how 
quickly the cost of a fuel-saving technology pays back.
    The current analysis uses updated fuel price estimates from AEO 
2015 that are lower than in the NPRM analysis. Lower fuel prices will 
decrease the absolute amount of fuel savings (assuming the same number 
of gallons is consumed) and increase the payback period if the 
technologies, their cost, and their effectiveness are unchanged. 
Further, we have updated the vehicle use schedule (vehicle miles 
traveled, or VMT) based on actual vehicle odometer readings from IHS/
Polk data as shown in Figure VI.6 While the overall survival-weighted 
schedules show 6.5 percent fewer lifetime miles for heavy-duty 
vehicles, they show more annual miles driven for the first 5-years of 
use for heavy-duty vehicles. The result is that the overall lifetime 
fuel savings will decrease, but the fuel savings will be higher for the 
first 5 years. Since the payback periods under both analyses are 
shorter than 5 years, using the updated vehicle schedules will show a 
shorter payback period (if other factors are unchanged) than in the 
NPRM analysis. The changes in fuel prices and the change in the mileage 
accumulation schedule work in opposite directions on the payback 
period; the total change in payback period is attributable to both of 
these input changes as well as to the changes in the cost \506\ and 
effectiveness \507\ of the different technology inputs, and the changes 
in the reference fleet.
---------------------------------------------------------------------------

    \506\ The costs now use RPE rather than ICM, and we updated the 
mass reduction curve to the 2014 Silverado.
    \507\ Nominal effectiveness input values are as for the NPRM 
analysis. Synergy factors applied to adjust fuel consumption impacts 
for specific combinations of technologies reflect current vehicle 
simulation work conducted for NHTSA by Argonne National Laboratory.
---------------------------------------------------------------------------

    Industry costs in MY 2030 provide one perspective on technology 
costs. Industry cost in each model year provides additional perspective 
on the timing, pace and the amount of resources and spending that would 
need to be allocated to implement technologies and is important in the 
consideration of the feasibility of the alternatives. Figures Figure 
VI-15and Figure VI-16 show the total and average additional and total 
additional technology costs for the industry by model year and 
alternative. Note that the trend of the total and average costs are 
very similar, this is because the fleets size the AEO projections 
suggest a relatively constant fleet size during the considered MY's. 
The total and average technology costs increase with alternative 
stringency. It is important to note that Alternatives 3 and 4 both 
increase total stringency for the MY 2030 industry fleet by 15.6 
percent. Also note that these estimations of stringency increases 
include the model projections of how the application of mass reduction 
will alter work factor and individual vehicle targets.\508\ The annual 
average and total technology costs of Alternative 3 approach those of 
Alternative 4 by MY 2029 when both alternatives have reached maximum 
stringency. If manufacturers are to reach the same stringency level 
over a longer horizon, they will likely make similar technology 
choices, but be given longer to implement them. This will make the 
total technology costs lower, but should unsurprisingly make the 
marginal technology costs for model years where both standards have 
matured very similar.
---------------------------------------------------------------------------

    \508\ The final Phase 2 standard target curves increase in 
stringency by 16.2 percent compared to final Phase 1 standards, as 
discussed in section VI.B.
---------------------------------------------------------------------------

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[GRAPHIC] [TIFF OMITTED] TR25OC16.024

    The average incremental industry technology costs mature to around 
$500 under Alternative 2, $1500 under Alternatives 3 and 4, and $1900 
under Alternative 5. Figure VI-17 shows the cumulative total industry 
costs by model year fleet. $4.2 billion in additional technology costs 
for model years 2016-2030 are associated with Alternative 2, $9.9 
billion with Alternative 3, $11.4 billion with Alternative 4, and $14.9 
billion with Alternative 5. While the marginal technology costs of 
Alternative 3 approach those of Alternative 4 as the

[[Page 73779]]

total stringencies converge, the total costs of Alternative 4 are $1.5 
billion more by MY 2030. It is particularly noteworthy that costs and 
the rate of increase in costs would be significantly different in the 
MYs 2017-2021 timeframe among the alternatives. This identifies the 
significant differences in the resources and capital that would be 
required to implement the technologies required to comply with each of 
the alternatives during this period, as well as the reduction in lead 
time to implement the technologies which increases reliability risk. 
These differences are an important consideration for the feasibility of 
the alternatives and for the selection of the final standards, as 
discussed further below.
[GRAPHIC] [TIFF OMITTED] TR25OC16.025

BILLING CODE 6560-50-C
(4) Manufacturer-Specific Results of Regulatory Alternatives
    In addition to varying across scenario and model year, the impacts 
of the standards vary across manufacturers. Manufacturers will have 
different compliance strategies based on which technologies they have 
already invested in, in both their heavy-duty and light-duty fleets, 
and based on the effectiveness of new technology applications specific 
to the vehicles in their heavy duty fleets. Table VI-14 summarizes the 
initial technology utilization in the 2015 fleet by manufacturer. Ford 
uses direct injection for 8 percent of their fleet, cylinder 
deactivation for 13 percent of their fleet, and turbo-charged engines 
for 8 percent of their fleet. Daimler has already invested to equip all 
of its fleet with 8-speed automatic transmissions. These differences in 
initial technology levels affect the new investments each manufacturer 
would need to further improve the fuel efficiency of their fleets.

                                         Table VI-14--Summary of MY 2015 Reference Fleet Technology Penetration
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                         Technology Penetration  (percent)
                       Technology                        -----------------------------------------------------------------------------------------------
                                                                GM             Ford             FCA           Daimler         Nissan         Industry
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cylinder Deactivation...................................               0               0              13               0               0               2
Direct Injection Engine.................................               0               8               0               0               0               4
Turbo Charged Engine....................................               0               8               0               0               0               4
8 Speed Auto. Trans.....................................               0               0               0             100               0               3
EPS, Accessories........................................               0               0               0               0               0               0
12V Stop-start..........................................               0               0               0               0               0               0
Strong Hybrid...........................................               0               0               0               0               0               0
Aero. Improvements......................................               0               0               0               0               0               0
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 73780]]

    Table VI-15 summarizes the alternatives, and a technology pathway 
General Motors could use to comply with each of the alternatives. The 
pathway includes implementing 8 speed automatic transmissions across 
its entire fleet. For Alternatives 2 and 3, no stop-start or HEVs are 
added to GM's fleet, for Alternative 4, 1 percent of GM's fleet uses 
stop-start, and for Alternative 5, 2 percent uses stop-start and 13 
percent are HEVs. For all alternatives, nearly all of the GM's fleet 
would use electric power steering and improved electric accessories.
    For all alternatives, VVT/VVL is applied to 65 percent of its 
engines. For Alternative 2, none of its engines get direct injection 
and 43 percent get turbocharging and downsizing, while for Alternatives 
3-5, direct injection is applied to 28 percent of its engines and 
turbocharging and downsizing is applied to 61 percent of its engines. 
For all alternatives, all of GM's fleet gets aerodynamic improvements. 
The average mass reduction is 52 lbs. (0.78 percent of the average curb 
weight) under Alternative 2, and 350-380 lbs. (5.2-5.7 percent of the 
average curb weight) under Alternatives 3-5. Similar technology is 
applied for Alternatives 3 and 4 in MY 2030, but there are 
significantly more strong hybrids under Alternative 5.

           Table VI-15--Summary Impacts on General Motors HD Fleet by Alternative (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                         Alternative                               2            3            4            5
----------------------------------------------------------------------------------------------------------------
                                             Alternative Stringency
----------------------------------------------------------------------------------------------------------------
Annual Increase in Stringency Beginning in MY 2021..........         2.0%         2.5%         3.5%         4.0%
Increases Until.............................................      MY 2025      MY 2027      MY 2025      MY 2025
Total Increase in MY 2030 Stringency Relative to Final Phase         9.6%        15.2%        15.4%        17.7%
 1 Standards \a\............................................
----------------------------------------------------------------------------------------------------------------
                                Estimated Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.........................................        18.69        19.92        19.96        20.53
Achieved in MY 2030.........................................        18.70        20.04        20.04         20.6
----------------------------------------------------------------------------------------------------------------
                                  Average Fuel Consumption (gallons/100 miles)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.........................................         5.35         5.02         5.01         4.87
Achieved in MY 2030.........................................         5.35         4.99         4.99         4.85
----------------------------------------------------------------------------------------------------------------
                           Estimated Average Greenhouse Gas Emissions (grams per mile)
----------------------------------------------------------------------------------------------------------------
CO[ihel2] Required in MY 2030...............................          498          467          466          453
CO[ihel2] Achieved in MY 2030...............................          496          464          464          452
----------------------------------------------------------------------------------------------------------------
                                   Technology Penetration in MY 2030 (percent)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..............................................           65           65           65           65
Cylinder Deactivation.......................................            0            0            0            0
Direct Injection Engine.....................................            0           28           28           28
Turbo Charged Engine........................................           33           61           61           61
8 Speed Auto. Trans.........................................          100          100          100          100
EPS, Accessories............................................          100          100          100          100
12V Stop-start..............................................            0            0            2            2
Strong Hybrid...............................................            0            0            0           13
Aero. Improvements..........................................          100          100          100          100
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Curb Weight Mass Reduction (lb.)............................           52          384          384          340
Mass Reduction (percent of curb weight).....................         0.78          5.7          5.7          5.1
----------------------------------------------------------------------------------------------------------------
Note:
\a\ This increase in stringency is based on the estimated percentage change in fuel consumption (gal/100mi)
  stringency projected by the model for the MY 2030 fleet under the final Phase 2 standards relative to the
  continuation of Phase 1 standards. Note that if manufacturers' have applied mass reduction to an individual
  vehicle model in the CAF[Eacute] model that this will increase the work factor of that vehicle in the model,
  and make the individual target less stringent. Thus, where any mass reduction is applied in the model, the
  total increase in stringency of the fleet presented here will be lower than the total stringency increase of
  the fleet if no mass reduction were applied.

    Figure VI-18 and Figure VI-19 show the total and average 
incremental technology costs by alternative. Under Alternative 2 
General Motors' incremental technology cost is $140M in MY 2019, 
increasing to $180M in MY 2021. The pathways for Alternatives 3 and 4 
are very similar, which again should not be surprising given that the 
standards result in the same total stringency increase in MY 2027 and 
beyond and the long redesign cycles in the segment. GM's incremental 
technology cost is $190M in MY 2019, increasing to $400M in MY 2021, 
and $530M in MY 2028. Under Alternative 5 GM could have a similar 
compliance strategy as Alternative 3 and 4, but incremental technology 
cost is $650M in MY 2028. The highest annual average technology cost 
for GM is: $750 under Alternative 2, $1940 under Alternatives 3 and 4, 
and $2370 under Alternative 5. In the case of GM, the added lead time 
of Alternative 4 does not significantly change the cost of their 
compliance strategy.
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[GRAPHIC] [TIFF OMITTED] TR25OC16.026

    Figure VI-20 shows the cumulative total incremental costs for GM 
under all alternatives. The total costs to comply with Alternative 2 
for GM for MY's 2016-2030 is $2.1 billion, for Alternatives 3 and 4 it 
is $4.8 billion, and for Alternative 5 it is $5.2 billion.

[[Page 73782]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.027

BILLING CODE 6560-50-C
    Table VI-16 gives the same summary of a potential compliance 
strategy for Ford's heavy-duty fleet. Similar to GM, to reach 
compliance Ford uses 8 speed automatic transmissions in their entire 
fleet. For Alternatives 3 and 4, Ford uses hybrid technologies in 4 
percent of their fleet, and for Alternative 5, they use hybrid 
technologies in 7 percent of their fleet. In addition to strong 
hybrids, Ford uses 12v stop-start in 4 percent of their fleet in 
Alternative 4, and 12v stop-start in 19 percent of their fleet in 
Alternative 5. The compliance strategy in the NPRM analysis shows Ford 
using significantly more hybrids and 12v stop-start systems in 
Alternatives 4 and 5 than the current analysis which likely explains 
part of the lowered cost for Ford in the current analysis.
    Under the current analysis possible compliance strategy, the 
application of engine technologies for Ford come in discrete chunks, as 
with GM. Ford uses VVT/VVL in 58 percent of their fleet under all 
alternatives by MY 2030; they started with 8 percent direct-injection 
engines, and end with 27 percent; they also started with 8 percent 
turbo-charged engines, but end with 69 percent for all scenarios. The 
application of EPS and improved accessories vary across the compliance 
strategies of different regulatory alternatives; under Alternative 2, 
only 13 percent of Ford's fleet improves these electrical features, 
while under Alternatives 3-4, 64 percent, and Alternative 5, 96 
percent.
    For body-platform technologies, Ford applies in discrete chunks to 
the same platforms across some Alternatives. They apply an average of 
77 lb. (1.2 percent) mass reduction across their fleet in Alternative 2 
and 132-142 lb. (2.0-2.2 percent) in Alternative 3-5. Progressively 
less mass reduction is applied under Alternatives 4 and 5--this is 
likely because more of the fleet was hybridized and mass reduction to 
small platforms was no longer necessary to comply. Aerodynamic 
improvements are not applied in Alternative 2, but are applied to 64 
percent of the fleet in Alternative 3 and 4, and to all of the fleet in 
Alternative 5.

              Table VI-16--Summary of Impacts on Ford HD Fleet by Alternative (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Alternative Stringency
----------------------------------------------------------------------------------------------------------------
Annual Increase in Stringency Beginning in MY               2.0%            2.5%            3.5%            4.0%
 2021...........................................
Increases Until.................................         MY 2025         MY 2027         MY 2025         MY 2025
Total Increase in MY 2030 Stringency Relative to            9.6%           15.7%           15.7%           18.1%
 Final Phase 1 Standards \a\....................
----------------------------------------------------------------------------------------------------------------
                                Estimated Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.............................           19.23           20.62           20.62           21.23
Achieved in MY 2030.............................           19.36           20.61           20.63           21.21
----------------------------------------------------------------------------------------------------------------
                                  Average Fuel Consumption (gallons/100 miles)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.............................             5.2            4.85            4.85            4.71
Achieved in MY 2030.............................            5.16            4.85            4.85            4.71
----------------------------------------------------------------------------------------------------------------

[[Page 73783]]

 
                           Estimated Average Greenhouse Gas Emissions (grams per mile)
----------------------------------------------------------------------------------------------------------------
CO2 Required in MY 2030.........................             488             456             455             443
CO2 Achieved in MY 2030.........................             485             455             455             443
----------------------------------------------------------------------------------------------------------------
                                   Technology Penetration in MY 2030 (percent)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................              58              58              58              58
Cylinder Deactivation...........................               0               0               0               0
Direct Injection Engine.........................              27              27              27              27
Turbo Charged Engine............................              69              69              69              69
8 Speed Auto. Trans.............................              64             100             100             100
EPS, Accessories................................              13              64              64              96
12V Stop-start..................................               0               0               4              19
Hybridization...................................               0               4               4               7
Aero. Improvements..............................               0              64              64             100
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Curb Weight Mass Reduction (lb.)................              77             142             140             132
Mass Reduction (percent of curb weight).........             1.2             2.2             2.1             2.0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ This increase in stringency is based on the estimated percentage change in fuel consumption (gal/100mi)
  stringency projected by the model for the MY 2030 fleet under the final Phase 2 standards relative to the
  continuation of Phase 1 standards. Note that if manufacturers' have applied mass reduction to an individual
  vehicle model in the CAF[Eacute] model that this will increase the work factor of that vehicle in the model,
  and make the individual target less stringent. Thus, where any mass reduction is applied in the model, the
  total increase in stringency of the fleet presented here will be lower than the total stringency increase of
  the fleet if no mass reduction were applied.

BILLING CODE 6560-50-P
    Figure VI-21 and Figure VI-22 show the total and average 
incremental technology costs for Ford by alternative and model year. 
Ford adds $80 million in technology costs for MY 2017 and an additional 
$40 million in MY 2026 in Alternative 2. For the Preferred Alternative, 
Ford adds $130 million in MY 2017 and an additional $300 million in MY 
2026. Under Alternative 4, Ford adds $260 million in MY 2017 and $180 
million in MY 2026. Similar to the industry pattern, Ford's compliance 
strategy involves less annual technology costs early in Alternative 3 
than Alternative 4, but their technology costs converge under the two 
alternatives as the final stringency level is reached under Alternative 
3 in MY 2027.
    It is important to note that the increase in costs and rate of the 
increase in costs is significantly different for MY 2017 among the 
alternatives--with the incremental total cost increase for MY 2017 
being double those of Alternative 3 for Alternative 4, and more than 
double for Alternative 5. MY 2017 is the first redesign year and Ford 
does not have another scheduled redesign until MY 2026. Under the 
additional lead time of Alternative 3, the majority of Ford's cost 
increases occur in the MY 2026 redesign, while Alternatives 4 and 5 put 
most of the cost burden to reach compliance on the MY 2017 redesign (or 
would require an additional redesign be added between MY 2017 and 
2026).
    NHTSA judges the lack of lead time would make Alternatives 4 and 5 
beyond maximum feasibility for Ford because its designs for MY 2017 are 
essentially complete and substantial resources and very high costs 
would be required to add another vehicle redesign between MY 2017 and 
MY 2026 to implement the technologies that would be needed to comply 
with those alternatives.
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[[Page 73784]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.028

    Figure VI-23 below shows the cumulative total costs for Ford under 
all action alternatives. The total costs for MY's 2015-2030 under 
Alternative 2 are $1.3 billion, under Alternative 3 they are $3.4 
billion, for Alternative 4 they are $4.5 billion, and finally for 
Alternative 5 they are $6.7 billion. This further illustrates the point 
that manufacturers act to minimize costs over multiple model years. The 
added lead time from Alternative 4 allows them to delay some actions, 
which will allow them more time to make sure that they are well-
implemented.

[[Page 73785]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.029

BILLING CODE 6560-50-C
    Table VI-17 shows the MY 2030 summary for Fiat/Chrysler. Fiat/
Chrysler is the only manufacturer which uses cylinder deactivation in 
their reference fleet, and they are the only manufacturer to use 
cylinder deactivation as a part of their possible compliance strategy. 
Under all scenarios, FCA increases their initial cylinder deactivation 
utilization of 13 percent to 24 percent. Under all scenarios turbo-
charged engines are applied to 76 percent of FCA's fleet by MY 2030. 
Other technologies are applied to the FCA equally across all scenarios; 
37 percent of their fleet uses VVT and/or VVL, and 64 percent uses 8-
speed automatic transmissions under all scenarios.
    The additional stringency from Alternative 2 to Alternatives 3-5 
results in other increased technology applications in the FCA fleet. 
Under Alternatives 3-5, the presence of EPS/electrical accessories 
increases from the 82 percent to the entirety of the FCA fleet. 
Similarly, increased aerodynamic improvements increase from 84 percent 
of the fleet to all of it. Finally, 12v stop-start enters 3 percent of 
the fleet under Alternatives 3-5. Alternatives 3 and 4 look much the 
same, except that Alternative 3 is the only alternative to use any (1 
percent) SHEV-P2 hybrids. Alternative 5 uses twice as much mass 
reduction than Alternatives 3-4; it uses 37 percent direct injection 
versus the 24 percent in Alternatives 2-4. The resulting costs are 
comparable under Alternatives 3 and 4, and almost 50 percent higher 
under Alternative 5.

          Table VI-17--Summary of Impacts on Fiat/Chrysler HD Fleet by Alternative (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Alternative Stringency
----------------------------------------------------------------------------------------------------------------
Annual Increase in Stringency Beginning in MY               2.0%            2.5%            3.5%            4.0%
 2021...........................................
Increases Until.................................         MY 2025         MY 2027         MY 2025         MY 2025
Total Increase in MY 2030 Stringency Relative to            9.6%           15.8%           15.8%           17.6%
 Final Phase 1 Standards \a\....................
----------------------------------------------------------------------------------------------------------------
                                Estimated Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.............................           18.59           19.96           19.96           20.41
Achieved in MY 2030.............................           18.97           20.06           20.04           20.42
----------------------------------------------------------------------------------------------------------------
                                  Average Fuel Consumption (gallons/100 miles)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.............................            5.38            5.01            5.01             4.9
Achieved in MY 2030.............................            5.27            4.99            4.99             4.9
----------------------------------------------------------------------------------------------------------------
                           Estimated Average Greenhouse Gas Emissions (grams per mile)
----------------------------------------------------------------------------------------------------------------
CO[ihel2] Required in MY 2030...................             520             485             485             474
CO[ihel2] Achieved in MY 2030...................             509             482             482             474
----------------------------------------------------------------------------------------------------------------
                                   Technology Penetration in MY 2030 (percent)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................              37              37              37              37

[[Page 73786]]

 
Cylinder Deactivation...........................              24              24              24              24
Direct Injection Engine.........................              24              24              24              37
Turbo Charged Engine............................              76              76              76              76
8 Speed Auto. Trans.............................              64              64              64              64
EPS, Accessories................................              82             100             100             100
12V Stop-start..................................               0               3               3               3
Hybridization...................................               0               1               0               0
Aero. Improvements..............................              84             100             100             100
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Curb Weight Mass Reduction (lb.)................              29             330             333             694
Mass Reduction (percent of curb weight).........             0.4             4.6             4.6             9.6
----------------------------------------------------------------------------------------------------------------
Note:
\a\ This increase in stringency is based on the estimated percentage change in fuel consumption (gal/100mi)
  stringency projected by the model for the MY 2030 fleet under the final Phase 2 standards relative to the
  continuation of Phase 1 standards. Note that if manufacturers' have applied mass reduction to an individual
  vehicle model in the CAF[Eacute] model that this will increase the work factor of that vehicle in the model,
  and make the individual target less stringent. Thus, where any mass reduction is applied in the model, the
  total increase in stringency of the fleet presented here will be lower than the total stringency increase of
  the fleet if no mass reduction were applied.

    Figures Figure VI-24 and Figure VI-25 show the incremental total 
and average technology costs for Chrysler/Fiat by model year and 
regulatory stringency. Chrysler/Fiat shows more technology costs for 
higher stringency alternatives, with annual technology costs of 
Alternative 3 approaching Alternative 4 annual technology costs as the 
Alternative 3 approaches the final stringency level in MY 2027. Under 
all alternatives Chrysler/Fiat incurs increased technology costs 
starting in MY 2018 and MY 2025, because they are estimated redesign 
years. The maximum annual technology costs for Chrysler are $92M in 
Alternative 2, $213M in Alternative 3, $227M in Alternative 4, and 
$330M in Alternative 5. This results in average technology costs of: 
$680, $1640, $1690, and $2460, respectively.
    As with Ford, the costs and the rate of increase in costs are 
significantly different in the MY 2018 timeframe among the 
alternatives, because MY 2018 is the first estimated model year for 
redesign, and the next estimated redesign opportunity is in MY 2025. 
Figure identifies the significant differences in the resources and 
capital that would be required to implement the technologies required 
to comply with each of the alternatives--with the estimated MY 2018 
technology cost increases being 48M under Alternative 3, 78M under 
Alternative 4, and 112M under Alternative 5. NHTSA judges the short 
lead time would make Alternatives 4 and 5 beyond maximum feasible for 
FCA because its designs for MY 2018 are nearing completion and 
substantial resources and very high costs would be required to add 
another vehicle redesign between MY 2018 and MY 2025 to implement the 
technologies that would be needed to comply with those alternatives.
BILLING CODE 6560-50-P

[[Page 73787]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.030

    The cumulative technology costs attributable to the action 
alternatives for FCA are represented in Figure VI-26 below. The total 
costs for MY's 2016-2030 under alter Alternative 2 are $750 million, 
under Alternative 3, they are $1.5 billion, for Alternative 4, $1.8 
billion, and for Alternative 5 they are $2.6 billion.

[[Page 73788]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.031

BILLING CODE 6560-50-C
    Table VI-18 shows the manufacturer-specific MY 2030 summary for 
Nissan. Nissan's 2015 reference fleet uses VVT and/or VVL on all of 
their heavy-duty vehicles. Their fleet uses two engines on only one 
body-style platform. As a result, technologies applied to Nissan's 
fleet are applied to large proportions of their fleet. Under all 
scenarios, their entire fleet gains 8-speed automatic transmissions. 
Under Alternatives 3-5, all of their fleet gets level-2 body-level 
aerodynamic improvements and all of their fleet gets electric accessory 
and/or EPS improvements. Under Alternatives 2, 4, and 5, one of 
Nissan's two heavy-duty engines gets direct-injection, while under 
Alternative 3, both engines get the technology. Direct injection of 
their entire fleet is the most cost-effective way to reach compliance 
under Alternative 2, applying 5 percent mass reduction to their entire 
fleet and direct injection of one of their engines is the most cost-
effective strategy under Alternative 4, and applying 10 percent mass 
reduction to their entire fleet, direct injection to one of their 
engines, and making their other engine hybrid is the most cost-
effective strategy under Alternative 5.
    Note that without a change in the work factor or fleet mix, a 
manufacturer will face the same MY 2030 standard under Alternatives 3 
and 4, and a more stringent standard under Alternative 5. However, by 
applying 5 percent mass reduction in Alternative 4, Nissan is able to 
reduce their standard by .27 MPG, and by applying 10 percent mass 
reduction in Alternative 5 to have the same MY 2030 standard under 
Alternatives 3 and 5. The result is that the CAFE level for Nissan is 
highest under Alternative 2, where direct injection of their entire 
fleet is the most cost-effective compliance strategy. We assume that 
manufacturers are able to make technologies more cost-effectively the 
longer they are on the market--this is called ``learning.'' A likely 
reason that the model prefers direct injection in Alternative 3 but not 
in Alternatives 4 and 5, is that the longer horizon of the stringency 
increase (until MY 2027) results in direct injection that is more cost-
effective than the shorter time span of Alternatives 4 and 5.

             Table VI-18--Summary of Impacts on Nissan HD Fleet by Alternative (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Alternative Stringency
----------------------------------------------------------------------------------------------------------------
Annual Increase in Stringency Beginning in MY               2.0%            2.5%            3.5%            4.0%
 2021...........................................
Increases Until.................................         MY 2025         MY 2027         MY 2025         MY 2025
Total Increase in MY 2030 Stringency Relative to            9.6%           16.2%           15.1%           16.2%
 Final Phase 1 Standards \a\....................
----------------------------------------------------------------------------------------------------------------
                                Estimated Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.............................           19.65           21.19           20.92           21.19
Achieved in MY 2030.............................           19.63           23.12           21.05           21.46
----------------------------------------------------------------------------------------------------------------
                                  Average Fuel Consumption (gallons/100 miles)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.............................            5.09            4.72            4.78            4.72
Achieved in MY 2030.............................            5.09            4.32            4.75            4.66
----------------------------------------------------------------------------------------------------------------

[[Page 73789]]

 
                           Estimated Average Greenhouse Gas Emissions (grams per mile)
----------------------------------------------------------------------------------------------------------------
CO[ihel2] Required in MY 2030...................             452             419             425             420
CO[ihel2] Achieved in MY 2030...................             453             384             422             414
----------------------------------------------------------------------------------------------------------------
                                   Technology Penetration in MY 2030 (percent)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................             100             100             100             100
Cylinder Deactivation...........................               0               0               0               0
Direct Injection Engine.........................              51             100              51              51
Turbo Charged Engine............................              51             100              51              51
8 Speed Auto. Trans.............................             100             100             100             100
EPS, Accessories................................              37             100             100             100
12V Stop-start..................................               0               0               0              49
Hybridization...................................               0               0               0               0
Aero. Improvements..............................               0             100             100             100
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Curb Weight Mass Reduction (lb.)................               0               0             307             615
Mass Reduction (percent of curb weight).........               0               0               5              10
----------------------------------------------------------------------------------------------------------------
Note:
\a\ This increase in stringency is based on the estimated percentage change in fuel consumption (gal/100mi)
  stringency projected by the model for the MY 2030 fleet under the final Phase 2 standards relative to the
  continuation of Phase 1 standards. Note that if manufacturers' have applied mass reduction to an individual
  vehicle model in the CAF[Eacute] model that this will increase the work factor of that vehicle in the model,
  and make the individual target less stringent. Thus, where any mass reduction is applied in the model, the
  total increase in stringency of the fleet presented here will be lower than the total stringency increase of
  the fleet if no mass reduction were applied.

    Figures Figure VI-27 and Figure VI-28 show the total and average 
incremental technology costs for Nissan across the different regulatory 
alternatives. Nissan applies technology in all alternatives in MY 2021; 
this is a redesign year for much of their fleet. As might be expected, 
they incur less technology cost in less stringent scenarios at this 
redesign. However, under Alternative 3 they apply more technology in MY 
2029, making their marginal technology costs under Alternative 3 for MY 
2029 and after higher than the marginal technology costs under 
Alternative 4. They incur less technology costs in the early years and 
more in MY's 2029 and beyond. In order to explain why the model 
predicts this action of Nissan it is useful to look at the cumulative 
total incremental costs in Figure VI-29.
BILLING CODE 6560-50-P

[[Page 73790]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.032

    By incurring less technology cost early, and more technology cost 
later, Nissan has a lower cumulative total cost for MY's 2016-2030 
under Alternative 3 than Alternative 4. The total cumulative cost for 
MY's 2016-2030 of Alternative 2 is $86 million, $178 million for 
Alternative 3, $258 for Alternative 4, and $387 for Alternative 5. 
Since Nissan is trying to minimize their total cost under all model 
years, and not their marginal cost under any single model year, the 
model chooses a compliance strategy in this case which shows higher 
marginal costs for Nissan in Alternative

[[Page 73791]]

3 than 4 for some model years, but lower cumulative total costs over 
all model years.
[GRAPHIC] [TIFF OMITTED] TR25OC16.033

BILLING CODE 6560-50-C
    Nissan's first redesign is in MY 2020, and they do not have another 
redesign scheduled until 2029. Under Alternative 4 and 5 all of their 
technological application is done in MY 2020, but under Alternative 3 
the application can be spread out between the two redesign cycles. 
NHTSA judges the short lead time to apply technology would make 
Alternatives 4 and 5 beyond maximum feasibility for Nissan because it 
puts the burden of all technological application on the MY 2020 
redesign. Substantial resources and costs would be required to do so or 
to add another vehicle redesign between MY 2020 and MY 2029. Since 
manufacturers must spread out their capital for such deployment 
endeavors between the light and heavy duty fleets, the ability to 
spread costs between model years is important to consider.
    Table VI-19 shows a MY 2030 summary for Daimler. Daimler came into 
the analysis with all of their fleet using 8-speed automatic 
transmissions. Their initial CAFE level in MY 2020 of 25.68 was 
sufficient to meet their standard under Alternatives 2-5. Their only 
action to turbo-charge all the engines in their fleet occurs in the 
dynamic baseline. As a result, no additional actions or costs are 
incurred under any of the alternatives. For this reason, a figure of 
their annual technology costs, nor their cumulative total technology 
costs has not been provided--if it were, it would be a horizontal line 
showing zero costs for all model years.

             Table VI-19--Summary of Impacts on Daimler HD Fleet by Alternative (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Alternative Stringency
----------------------------------------------------------------------------------------------------------------
Annual Increase in Stringency Beginning in MY               2.0%            2.5%            3.5%            4.0%
 2021...........................................
Increases Until.................................         MY 2025         MY 2027         MY 2025         MY 2025
Total Increase in Stringency Relative to Final              9.7%           16.3%           16.3%           18.4%
 Phase 1 Standards \a\..........................
----------------------------------------------------------------------------------------------------------------
                                Estimated Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.............................           22.88           24.69           24.69           25.32
Achieved in MY 2030.............................           25.68           25.68           25.68           25.68
----------------------------------------------------------------------------------------------------------------
                                  Average Fuel Consumption (gallons/100 miles)
----------------------------------------------------------------------------------------------------------------
Required in MY 2030.............................            4.37            4.05            4.05            3.95
Achieved in MY 2030.............................            3.89            3.89            3.89            3.89
----------------------------------------------------------------------------------------------------------------

[[Page 73792]]

 
                           Estimated Average Greenhouse Gas Emissions (grams per mile)
----------------------------------------------------------------------------------------------------------------
CO[ihel2] Required in MY 2030...................             445             413             412             402
CO[ihel2] Achieved in MY 2030...................             396             396             396             396
----------------------------------------------------------------------------------------------------------------
                                   Technology Penetration in MY 2030 (percent)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................               0               0               0               0
Cylinder Deactivation...........................               0               0               0               0
Direct Injection Engine.........................               0               0               0               0
Turbo Charged Engine............................             100             100             100             100
8 Speed Auto. Trans.............................             100             100             100             100
EPS, Accessories................................               0               0               0               0
12V Stop-start..................................               0               0               0               0
Hybridization...................................               0               0               0               0
Aero. Improvements..............................               0               0               0               0
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Curb Weight Mass Reduction (lb.)................               0               0               0               0
Mass Reduction (percent of curb weight).........               0               0               0               0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ This increase in stringency is based on the estimated percentage change in fuel consumption (gal/100mi)
  stringency projected by the model for the MY 2030 fleet under the final Phase 2 standards relative to the
  continuation of Phase 1 standards. Note that if manufacturers' have applied mass reduction to an individual
  vehicle model in the CAF[Eacute] model that this will increase the work factor of that vehicle in the model,
  and make the individual target less stringent. Thus, where any mass reduction is applied in the model, the
  total increase in stringency of the fleet presented here will be lower than the total stringency increase of
  the fleet if no mass reduction were applied.

(5) Summary of Consumer/Operator Impacts
    Table VI-20 summarizes the impacts of the regulation on the 
consumer/operator of the heavy-duty vehicles. Consumers of more fuel 
efficient vehicles will benefit in several ways: They will spend less 
on fuel to operate vehicles for the same amount of travel, some will 
drive more because their per-mile travel costs less, and they will 
spend less time refueling vehicles. In order to estimate the fuel 
savings for each regulatory alternative, future gasoline prices must be 
predicted and the rebound effect (per-mile elasticity of operating a 
vehicle) must be assumed to account for the cost of additional driving. 
In the main analysis, the rebound effect is assumed to be 10 percent, 
so that, for example, a 10 percent reduction in the per-mile travel 
costs will result in a 1 percent increase in the amount of miles 
driven. Since the literature has also supported other rebound effects, 
NHTSA tests several sensitivity cases assuming different rebounds: 5 
percent, 15 percent, and 20 percent. Based on the average miles driven 
of 2b/3 vans and trucks, the expected lifetime fuel savings for a 
heavy-duty vehicle under the preferred scenario is $3636.
    The other benefits of to the consumer of increasing fuel economy 
are increased mobility and a decreased amount of time spent refueling 
the vehicle. Because increasing the efficiency of a vehicle makes per-
mile travel cheaper to the operator, consumers of these vehicles can 
travel more, at less than the total amount they are willing to pay--
this increase in welfare that is not accounted for by the cost of 
travel is the consumer surplus. The estimated mobility benefit is $394 
under the preferred alternative. The avoided time refueling also has a 
value. In order to estimate this value we make several assumptions 
outlined in more detail of the NPRM description of the model 
assumptions (Section E). Over the lifetime of a MY 2030 vehicle, we 
estimate the refueling surplus at $94 under the preferred alternative.
    It is also important to note that the average manufacturer costs 
will not be spread proportionally across the fleet--some vehicles will 
have incurred more technology costs than others. How manufacturers 
distribute costs among models will largely depend on the elasticity of 
particular models and the importance of fleet mix in meeting standards 
and on total profits. Without privy to this sort of information, we use 
average technology cost increase as a proxy for measuring the industry 
and consumer costs across different scenarios. The average technology 
cost increase is $1472 under the preferred alternative. We assume that 
all of this cost will be passed onto the consumer in the form of an 
increase in price. However, we also consider that an increase in price 
will have other costs to the operator of the vehicle.
    More expensive vehicles will have higher taxes/fees associated with 
their purchase, will be more expensive to insure (these costs are 
related to the purchase price or value of a vehicle) and will be more 
expensive to finance (higher loan values will be taken out which result 
in higher amounts paid in total interest). The total additional costs 
to the average consumer from the sum of these sources is $589 under the 
preferred alternative. It is important to keep in mind that the 
additional cost to finance a more expensive vehicle will have different 
effects depending on the budget constraint of the consumer. For 
consumers who are budget-constrained, they will finance more of the 
vehicle and the costs of financing will be higher for these already-
constrained consumers. For consumers who do not have to finance the 
vehicle, there will be no costs--and therefore, no additional costs--to 
finance the vehicle. Since budget-constrained consumers likely have a 
more elastic demand for new vehicles, the increase in price and the 
heterogeneous increase in financing might work in the same direction to 
price proportionally more of the most budget-constrained consumers out 
of the new vehicle market.
    Considering all the costs and benefits the standards will have to 
the consumer, the result is a net benefit to the consumer under all the 
considered alternatives. The net benefit to the

[[Page 73793]]

consumer is $2,063 under the preferred alternative, higher than the net 
benefit under alternative 4. The payback period is another measure of 
the effect of the rule on consumers--for all alternatives the payback 
period is under 3 years--suggesting that consumers that own vehicles 
for at least 3 years will receive a net benefit from the preferred 
regulatory action.

               Table VI-20--Summary of Consumer/Operator Impacts for MY 2030 (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Alternative Stringency
----------------------------------------------------------------------------------------------------------------
Annual Increase.................................            2.0%            2.5%            3.5%            4.0%
Increases Until.................................         MY 2025         MY 2027         MY 2025         MY 2025
----------------------------------------------------------------------------------------------------------------
                          Average Value of Lifetime Fuel Savings, $2013 (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Pretax..........................................          $1,713          $3,256          $3,229          $3,804
Tax.............................................             200             381             377             448
                                                 ---------------------------------------------------------------
    Total.......................................           1,913           3,636           3,607           4,252
----------------------------------------------------------------------------------------------------------------
                      Average Value of Additional Economic Benefits, $2013 (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Mobility Increase...............................             220             394             390             453
Avoided Refueling...............................              49              94              93             112
----------------------------------------------------------------------------------------------------------------
                                  Average New Vehicle Purchase (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Price Increase ($)..............................             496           1,472           1,481           1,893
Additional Costs ($) \a\........................             103             306             336             393
Payback (months) \b\............................              20              33              33              38
----------------------------------------------------------------------------------------------------------------
                             Net Lifetime Consumer/Operator Benefits (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Total Net Benefit ($)...........................           1,488           2,063           1,989           2,167
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Additional Costs include additional taxes, fees, maintenance costs, financing costs, and insurance costs
  incurred under the regulatory alternatives.
\b\ The payback period from the consumer perspective uses a 7% discount rate of retail fuel savings starting at
  the time of purchase. The cost increases paid back include: Technology costs, maintenance costs, taxes, and
  fees.

(6) Summary of Societal Impacts
    Table VI-21 summarizes the overall societal impacts of the 
regulation under different scenarios (relative to the 1b baseline). Net 
social benefits increase with the stringency of the standards. The net 
benefits for the preferred alternative are $18.8 billion. The largest 
benefit of the program comes in the form of fuel savings. The fuel 
savings reported above do not include fuel tax savings, as taxes are 
considered a transfer, and not a loss, of societal well-being. The fuel 
savings are associated with a fuel security externality, which 
monetizes the economic risk associated with potential fuel price 
spikes--as fewer gallons of oil are necessary for transportation, this 
risk decreases. The carbon externality represents the reduced cost of 
carbon damage when fuel economy increases (and carbon emissions 
decrease), and is also related directly with fuel savings.

         Table VI-21--Summary of Lifetime Total Societal Impacts of MY's 2015-2029 (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Alternative Stringency
----------------------------------------------------------------------------------------------------------------
Annual Increase.................................            2.0%            2.5%            3.5%            4.0%
Increases Until.................................         MY 2025         MY 2027         MY 2025         MY 2025
----------------------------------------------------------------------------------------------------------------
                                  Fuel Purchases vs. No-Action (billion 2013$)
----------------------------------------------------------------------------------------------------------------
Pretax Savings..................................           $11.1           $17.8           $20.2           $22.7
----------------------------------------------------------------------------------------------------------------
                            Fuel-Related Externalities vs. No-Action (billion 2013$)
----------------------------------------------------------------------------------------------------------------
Energy Security.................................             0.7             1.2             1.4             1.5
CO[ihel2] Emissions.............................             2.4             3.8             4.4             4.9
----------------------------------------------------------------------------------------------------------------
                             VMT-Related Externalities vs. No-Action (billion 2013$)
----------------------------------------------------------------------------------------------------------------
Driving Surplus.................................             1.3             2.0             2.3             2.5
Refueling Surplus...............................             0.3             0.6             0.6             0.7
Congestion......................................            -0.3            -0.5            -0.5            -0.6
Crashes.........................................            -0.2            -0.2            -0.3            -0.3

[[Page 73794]]

 
Noise...........................................             0.0             0.0             0.0             0.0
Fatalities......................................            -0.7            -0.3            -0.4             0.7
Criteria Emissions..............................             0.7             1.2             1.4             1.5
----------------------------------------------------------------------------------------------------------------
                         Vehicle Purchase/Operating Costs vs. No-Action (billion 2013$)
----------------------------------------------------------------------------------------------------------------
Technology Costs................................             2.9             6.5             7.7            10.2
Maintenance Costs...............................             0.1             0.3             0.3             0.5
----------------------------------------------------------------------------------------------------------------
                               Cost-Benefit Summary vs. No-Action (billion 2013$)
----------------------------------------------------------------------------------------------------------------
Total Social Cost...............................             4.2             7.8             9.2            11.6
Total Social Benefit............................            16.5            26.6            30.3            34.5
Net Social Benefit..............................            12.3            18.8            21.1            22.9
----------------------------------------------------------------------------------------------------------------

    Increasing fuel economy decreases the cost of per-mile travel. 
Since this reduction in the cost of travel results in an increase of 
total travel, it also results in an increase of externalities 
associated with increased total VMT. Of these, the driving surplus 
represents the societal net increase in benefit from increased mobility 
consumer surplus--the sum of the benefit to all operators of increased 
travel which is not captured by the total cost of travel. Defined from 
the societal perspective, the refueling benefit is the sum of all the 
value of the time saved on refueling by increasing the average fuel 
efficiency of the heavy duty fleet. Congestion represents the societal 
cost of increases in congestion on the roads--the lost value of 
additional time spent in traffic. The crash externality is the cost of 
the damage done by the additional crashes that will happen with more 
VMT exposure, and the noise externality represents the cost of a change 
in noise related to increases in vehicle travel (in this analysis, it 
is negligible for all alternatives).
    Some VMT-related externalities are not always positive or negative, 
but depend on the stringency of the standards. For this analysis the 
criteria pollutant externality is always a benefit, but this need not 
be the case. Reduction in overall fuel consumed reduces emissions 
associated with production and distribution of fuels. Increases in VMT 
will result in more emission of vehicle criteria pollutants and more 
associated damages. However, increasing fuel-economy though vehicle 
technologies, such as aerodynamics, mass reduction and improved tire 
rolling resistance, will result in a decrease in vehicle emissions of 
and damages from criteria pollutants. Shifts in technologies towards 
electric and hybrid-electric alternatives can increase the emissions of 
certain pollutants, and reduce the emissions of others. The stringency 
increases considered in the heavy-duty analysis do not require these 
technologies to penetrate the market at such a level that this is 
visible in the results. For these reasons the externality associated 
with changes in criteria pollutant emissions is always positive for 
this analysis.
    The vehicle mass reduction in HD pickup and vans is estimated to 
reduce the net incidence of highway fatalities. By reducing mass on 
some HD pickup and vans, the fatality rate associated with crashes 
involving at least one HD pickup or van vehicles decreases. However, 
the analysis anticipates that the indirect effect of the proposed 
standards, by reducing the operating costs, would lead to increased 
travel by HD pickups and vans and, therefore, more crashes involving 
these vehicles. The sign of the fatality externality varies with the 
stringency of the standards. Over the lifetime of MY's 2016-2029, for 
Alternative 2 it is estimated approximately 120 additional fatalities 
could occur relative to the 30,200 heavy-duty crash-related fatalities 
in the baseline. For Alternatives 3 and 4 we estimate approximately 50 
additional fatalities relative to the no-action alternative. The 
additional risk of fatality is represented as a social cost in 
Alternatives 2-4. For Alternative 5 we estimate approximately 110 fewer 
fatalities (represented as a positive externality). For Alternatives 2-
4, the effect of removing mass from the heavier vehicles is less than 
the effect of increased VMT-exposure; for Alternative 5, it is larger, 
and the alternative could result in a decrease of fatalities.
    The major direct costs of the program are increased technology 
costs and costs associated with the resultant increase in new vehicle 
prices and changes in technologies. The sum of technology costs across 
the industry increase under all increases of stringency, as do the 
increases in associated additional costs. Additional costs include: 
additional costs of maintenance associated with certain technologies. 
These costs will mostly be borne by the consumer, and paid back in the 
form of fuel savings.
(7) Summary of Environmental Impacts
    In addition to modeling the societal impacts from a monetary 
standpoint, the CAFE model also considers the absolute change in the 
physical emissions of various criteria pollutants across the 
Alternatives. Table VI-22 summarizes the total environmental impacts 
from increased fuel efficiency of MYs 2016-2030, taking into 
consideration the reduction in emissions from increased efficiency, the 
additional emissions associated with the increased VMT from cheaper 
per-mile travel, and changes in emissions due to the production and 
distribution of heavy-duty vehicles. Across all scenarios, the absolute 
reduction in emissions increases. For context, the percentage change of 
emissions relative to the baseline emission levels is also provided. 
The proportional reduction in criteria pollutants greatly varies; the 
greenhouse gases--carbon dioxide, methane, and nitrous oxide--as well 
as the criteria pollutants--sulfur dioxide and diesel particulate 
matter--show the largest proportional reductions across all scenarios.

[[Page 73795]]



            Table VI-22--Summary of Lifetime Emission Impacts of MY's 2015-2029 (vs. Alternative 1b)
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
Annual Increase.................................            2.0%            2.5%            3.5%            4.0%
Increases Until.................................         MY 2025         MY 2027         MY 2025         MY 2025
----------------------------------------------------------------------------------------------------------------
                                Greenhouse Gas Emissions Reductions vs. No-Action
----------------------------------------------------------------------------------------------------------------
CO[ihel2] (mmt).................................              66             107             120             135
CH4 and N[ihel2]O (tons)........................          97,925         160,044         180,557         202,666
----------------------------------------------------------------------------------------------------------------
                            Greenhouse Gas Emissions Percent Reduction vs. No-Action
----------------------------------------------------------------------------------------------------------------
CO[ihel2].......................................            3.8%            6.1%            6.9%            7.7%
CH4 and N[ihel2]O...............................            0.7%            1.2%            1.3%            1.5%
----------------------------------------------------------------------------------------------------------------
                                Other Emissions Absolute Reduction vs. No-Action
----------------------------------------------------------------------------------------------------------------
CO (tons).......................................          13,747          22,828          26,375          29,589
VOC and NOX (tons)..............................          33,324          56,100          63,237          70,957
PM25 (tons).....................................           1,320           2,213           2,498           2,806
SO[ihel2] (tons)................................          10,713          17,877          20,172          22,669
Air Toxics (tons)...............................              53              75              84              94
Diesel PM10 (tons)..............................           2,357           3,944           4,450           5,004
----------------------------------------------------------------------------------------------------------------
                                 Other Emissions Percent Reduction vs. No-Action
----------------------------------------------------------------------------------------------------------------
CO..............................................             0.2             0.4             0.4             0.5
VOC and NOX.....................................             1.6             2.8             3.1             3.5
PM25............................................             1.9             3.3             3.7             4.1
SO[ihel2].......................................             3.7             6.2             6.9             7.8
Air Toxics......................................             0.2             0.2             0.2             0.3
Diesel PM10.....................................             3.5             5.8             6.5             7.3
----------------------------------------------------------------------------------------------------------------

(8) Sensitivity Analysis Evaluating Different Inputs to the NHTSA CAFE 
Model
    This section describes some of the principal sensitivity results, 
obtained by running the various scenarios describing the policy 
alternatives with alternative inputs. OMB Circular A-4 indicates that 
``it is usually necessary to provide a sensitivity analysis to reveal 
whether, and to what extent, the results of the analysis are sensitive 
to plausible changes in the main assumptions and numeric inputs.'' 
\509\ Considering this guidance, a number of sensitivity analyses were 
performed using analysis Method A to examine important assumptions and 
inputs, including the following, all of which are discussed in greater 
detail in the accompanying RIA:
---------------------------------------------------------------------------

    \509\ Available at http://www.whitehouse.gov/omb/circulars_a004_a-4/.
---------------------------------------------------------------------------

    1. Payback Period: In addition to the 0 and 6 month payback periods 
discussed above, also evaluated cases involving payback periods of 12, 
18, and 24 months.
    2. Fuel Prices: Evaluated cases involving fuel prices from the AEO 
2015 low and high oil price scenarios. (See AEO-Low and AEO-High in the 
tables).
    3. Fuel Prices and Payback Period: Evaluated one side case 
involving a 0 month payback period combined with fuel prices from the 
AEO 2015 low oil price scenario, and one side case with a 24 month 
payback period combined with fuel prices from the AEO 2014 high oil 
price scenario.
    4. Benefits to Vehicle Buyers: The main Method A analysis assumes 
there is no loss in value to owner/operators resulting from vehicles 
that have an increase in price and higher fuel economy. NHTSA performed 
this sensitivity analysis assuming that there is a 25, or 50 percent 
loss in value to owner/operators--equivalent to the assumption that 
owner/operators will only value the calculated benefits they will 
achieve at 75, or 50 percent, respectively, of the main analysis 
estimates. (These are labeled as 75pctOwner/Operator Benefit and 
50pctOwner/Operator Benefit.)
    5. 7 Pct Discount Rate: The main analysis results are considered 
using either a 0 or 3 percent discount rate. We also considered an 
alternative case where future savings/costs are discounted 7 percent 
annually.
    6. Value of Avoided GHG Emissions: Evaluated side cases involving 
lower and higher valuation of avoided CO2 emissions, 
expressed as the social cost of carbon (SCC).
    7. Rebound Effect: Evaluated side cases involving rebound effect 
values of 5 percent, 15 percent, and 25 percent. (These are labeled as 
05PctReboundEffect, 15PctReboundEffect and 25PctReboundEffect).
    8. ICM-based Markup: Evaluated a side case using a retail price 
equivalent (ICM) markup factor.
    9. Mass-Safety Effect: Evaluated side cases with the mass-safety 
impact coefficient at the values defining the 5th and 95th percent 
points of the confidence interval estimated in the underlying 
statistical analysis. (These are labeled MassFatalityCoeff05pct and 
MassFatalityCoeff95pct).
    10. VMT Schedules: Evaluated side cases considering the NHTS 
considered in the NPRM analysis as a high-VMT case, and another 
considered schedule as a low-VMT case.
    11. Strong HEVs: Evaluated a side case in which strong HEVs were 
excluded from the set of technology estimated to be available for HD 
pickups and vans through model year 2030. As in Section VI.C. (8), this 
``no SHEV'' case allowed turbocharging and downsizing on all GM vans to 
provide a lower-cost path for compliance.
    Table VI-23, below, summarizes key metrics for each of the cases 
included in the sensitivity analysis using Method A for the 
alternative. The table reflects the percent change in the metrics 
(columns) relative to the main analysis, due to the particular 
sensitivity case (rows) for the alternative 3. For each sensitivity 
run, the change in the metric can we

[[Page 73796]]

described as the difference between the baseline and the preferred 
alternative for the sensitivity case, minus the difference between the 
preferred alternative and the baseline in the main analysis, divided by 
the difference between the preferred alternative and the baseline in 
the main analysis. Or,
[GRAPHIC] [TIFF OMITTED] TR25OC16.034

    Each metric represents the sum of the impacts of the preferred 
alternative over the model years 2015-2029, and the percent changes in 
the table represent percent changes to those sums. More detailed 
results for all alternatives are available in the accompanying RIA 
Chapter 10.

    Table VI-23--Sensitivity Analysis Results From CAFE Model in the HD Pickup and Van Market Segment Using Method A and Versus the Dynamic Baseline,
                                                                     Alternative 1b
                                        [2.5% growth in stringency: Cells are percent change from base case] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             CO[ihel2]                                        Social        Social net
                    Sensitivity case                       Fuel savings    savings (MMT)   Fuel savings    Social costs      benefits        benefits
                                                           (gallons) (%)        (%)           ($) (%)     ($billion) (%)  ($billion) (%)  ($billion) (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
0 Month Payback.........................................             8.4             8.0             7.7             8.0             7.8             7.7
12 Month Payback........................................             -13             -14             -15            -2.8             -14             -19
18 Month Payback........................................             -30             -31             -32             -16             -31             -38
24 Month Payback........................................             -47             -47             -48             -32             -48             -54
AEO-Low.................................................            -5.4            -5.8             -31             -19             -26             -29
AEO-High................................................             -27             -28              18            -2.8              13              20
AEO-Low, 0 Month Payback................................              35              33              33              42              34              30
AEO-High, 24 Month Payback..............................             -50             -50             -51             -37             -51             -57
7pct Discount Rate......................................             0.0             0.0             -41             -31             -35             -37
50pct Owner/Operator Benefit............................             0.0             0.0             -50             0.0             -34             -48
75pct Owner/Operator Benefit............................             0.0             0.0             -25             0.0             -17             -24
Low SCC.................................................             0.0             0.0             0.0             0.0             -11             -16
High SCC................................................             0.0             0.0             0.0             0.0             8.2              12
Very High SCC...........................................             0.0             0.0             0.0             0.0              30              43
5pct Rebound............................................             4.6             4.6             4.6             -13            0.37             5.5
15pct Rebound...........................................            -4.6            -4.6            -4.6              12           -0.37            -5.5
25pct Rebound...........................................             -14             -14             -14              37            -1.1             -17
5th Percentile Mass Fatality Coefficient................             0.0             0.0             0.0             -11             0.0             4.6
95th Percentile Mass Fatality Coefficient...............             0.0             0.0             0.0              15             0.0            -6.0
No SHEV-P2's............................................            0.18            0.29            0.29            -1.3            0.26            0.88
Non-CO[ihel2]eq GHG Values..............................             0.0             0.0             0.0             0.0             0.0             0.0
ICM-Based Mark-Up.......................................            -5.7            -6.0            -6.1             -16            -6.0            -1.8
High VMT................................................             8.6             7.4             5.9            0.11             6.2             8.7
Low VMT.................................................            -7.7            -8.3            -8.0             -14            -7.8            -5.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the less dynamic baseline, 1a, and more dynamic
  baseline, 1b, please see Section X.A.1.

    For some of the cases for which results are presented above, the 
sensitivity of results to changes in inputs is simple, direct, and 
easily observed. For example, changes to valuation of avoided GHG 
emissions impact only this portion of the estimated economic benefits; 
manufacturers' responses and corresponding costs are not impacted. 
Similarly, a higher discount rate does not affect physical quantities 
saved (gallons of fuel and metric tons of CO2 in the table), 
but reduces the value of the costs and benefits attributable to these 
standards in an intuitive way. Higher rebound results in fewer 
volumetric fuel savings and social net benefits, as drivers are assumed 
to be more responsive in their driving habits to changes in the cost 
per mile of travel. Some other cases warrant closer consideration:
    First, cases involving alternatives to the reference case involving 
voluntary over compliance of technologies that pay back in six-months 
involve different degrees of fuel consumption improvement. Increasing 
the length of the payback period assumption for voluntary over 
compliance amounts to increasing fuel economy improvements in the 
absence of the rule (the baseline), and manufacturers are compelled to 
add less technology in order to comply with the standards (in the 
regulatory alternatives). Because all estimated impacts of these 
standards are shown as incremental values relative to this baseline, 
longer voluntary over compliance payback periods correspond to smaller 
estimates of incremental impacts.
    Table VI-24 shows the effect of varying the voluntary over 
compliance assumption from the consumer perspective. The baseline over-
compliance payback period is as described above--the number of months 
within which a technology must pay back to the consumer in the form of 
undiscounted retail fuel savings for a manufacturer to voluntarily 
apply that technology without regulatory action. The incremental per-
vehicle technology cost is the average additional cost of technology 
applied to MY 2030 vehicles under the final regulation (incremental to 
the baseline) of each sensitivity case. The per-vehicle lifetime fuel 
savings is

[[Page 73797]]

the average lifetime retail value of fuel savings under each 
sensitivity case discounted at 7 percent annually starting at the time 
of purchase (MY 2030). Compliance payback period is the number of 
months of ownership it would take the average consumer to recoup the 
additional technology costs in discounted fuel savings.\510\
---------------------------------------------------------------------------

    \510\ This is based on the VMT schedules of average miles driven 
by age of MDHD pickups and vans and AEO fuel price projections.
---------------------------------------------------------------------------

    As can be seen, the baseline voluntary over compliance assumption 
changes how much of the technology costs and fuel savings are 
attributed to the regulation; both fewer fuel savings and fewer 
technology costs are attributed to the regulatory alternative as the 
payback period defining voluntary over compliance increases. Further, 
because the model only applies the technologies with the shortest 
payback periods (the most cost-effective technologies) in the baseline, 
the fuel savings decrease at a greater proportion than the technology 
costs. The result is that the payback period of the regulatory 
alternative increases (and at an increasing rate) as manufacturers are 
assumed to apply more technology in the baseline.

 Table VI-24--Sensitivity Analysis of the Voluntary Over Compliance Assumption on Compliance Payback Period and
                                 Key Consumer Impacts for the MY 2030 MDHD Fleet
----------------------------------------------------------------------------------------------------------------
                                                                    Incremental                     Technology
                                                                    per-vehicle     Per-vehicle    cost payback
            Baseline over-compliance payback (months)               technology     lifetime fuel      period
                                                                       cost           savings       (months) a
----------------------------------------------------------------------------------------------------------------
0...............................................................          $1,471          $3,966              28
6...............................................................           1,472           3,636              31
12..............................................................           1,317           3,031              33
18..............................................................           1,214           2,556              38
24..............................................................             944           1,684              45
----------------------------------------------------------------------------------------------------------------
Note:
\a\ Here the payback calculation uses a 7% discount rate of retail fuel savings starting at the time of purchase
  and only considers the additional costs of technology application.

    Cases involving different fuel prices similarly involve different 
degrees of fuel economy improvement in the absence of the standard, as 
more, or less, improvement occurs as a result of more, or fewer, 
technologies appearing cost effective to owner/operators. Low fuel 
prices change the amount of fuel savings for each technology, since the 
choice in technology application also involves both the size of the 
cost and the fuel savings, lower fuel prices can change the rank of the 
technologies. Under low fuel prices, the model applies fewer SHEV-P2's. 
The result is a reduction in volumetric fuel savings, and an even 
larger reduction in monetary fuel savings, because the fuel savings are 
worth less. There is also a reduction in social costs, and social net 
benefits. Higher fuel prices correspond to reductions in the volumetric 
fuel savings attributable to these standards as, but lead to increases 
in the value of fuel saved (and net social benefits) because each 
gallon saved is worth more when fuel prices are high.
    The low price and 0-month payback case leads to a significant 
increase in volumetric savings compared to the main analysis. Note that 
the fuel savings are higher than in the 0-month payback case alone. 
Part of the reason for this is that the lower fuel price case takes 
into consideration that when fuel prices are lower, consumers buy more 
heavy-duty vehicles (this is estimated from the AEO2015 low fuel price 
case). Another piece of the explanation is that the lower fuel prices 
result in a different technology cost-effectiveness ranking of 
technologies, and that the 0 month payback baseline results in no 
voluntary over compliance in the baseline. Different technologies are 
picked than in the 0 month pay back sensitivity alone, and the most 
cost effective that would have been applied in the baseline, are now 
attributed to the preferred alternative. Similarly, the high price and 
24-month payback case results in large reductions to volumetric savings 
that can be attributed to these standards because more is applied in 
the baseline. Further, the presence of high fuel prices is not 
sufficient to lead to increases in either the dollar value of fuel 
savings or net social benefits.
    The case which involves the VIUS-based VMT schedules (the high VMT 
case) results in greater volumetric fuel and GHG-savings attributable 
to the standards. Under this case the higher estimate of VMT results in 
more fuel consumption in the baseline, and a higher absolute change in 
fuel consumption when fuel-saving technologies are applied in the 
preferred alternative. These higher amount of gallons saved, results in 
more monetary fuel savings, comparable social costs, and an increase in 
overall net social benefits attributed to the standards. The low-VMT 
schedule, developed as an alternative to the adopted VMT-schedule from 
the IHS/Polk odometer readings, results in lower volumetric fuel 
consumption and GHG reductions under the preferred alternative. Lower 
VMT estimates result in less fuel consumption in the baseline, and a 
lower absolute change in fuel consumption under the preferred 
alternative. This schedule attributes lower costs to the standards--the 
lower fuel savings under the low-VMT schedule changes the technology 
application decisions of the model, since fewer fuel savings are 
considered in measure the cost-effectiveness of technologies. The 
result is lower absolute technology costs, but also lower social net 
benefits.
    The case which makes SHEV-P2's unavailable involves relatively 
small increases to volumetric fuel savings and CO2 
reductions--not surprising, since SHEV-P2's play only a minor role in 
the compliance strategy of the preferred alternative in the Method A 
central analysis. These small increases in fuel savings are associated 
with small increases in social benefits, slightly larger proportional 
increases in social costs, but still result in a small increase in 
social net benefit.
    The case that uses the ICM mark-up methodology rather than the RPE 
methodology results in a reduction of volumetric fuel savings and GHG 
reductions. The reduction in fuel

[[Page 73798]]

savings is accompanied by a reduction in monetary fuel savings, social 
benefits, social costs, and social net benefits. This is likely due to 
shifts in technology applications due to different costs mark-ups 
associated with different types of technologies under the ICM mark-up 
methodology.
    If, instead of using the values in the main analysis, each 
sensitivity case were itself the main analysis, the costs and benefits 
attributable to the final rule will be as they appear in Table VI-25, 
below.

                     Table VI-25--Costs and Benefits of Standards for MY 2015-2029 HD Pickups and Vans Under Alternative Assumptions
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Fuel savings      CO[ihel2]                                        Social        Net social
                    Sensitivity case                         (billion        reduction     Fuel savings    Social costs      benefits        benefits
                                                             gallons)          (MMT)        ($billion)      ($billion)      ($billion)      ($billion)
--------------------------------------------------------------------------------------------------------------------------------------------------------
6 Month Payback.........................................             9.2             110              18             7.8              27              19
0 Month Payback.........................................              10             120              19             8.2              28              20
12 Month Payback........................................             8.0              92              15             7.3              22              15
18 Month Payback........................................             6.4              74              12             6.4              18              12
24 Month Payback........................................             4.9              56             9.3             5.2              14             8.5
AEO-Low.................................................             8.7             100              12             6.1              19              13
AEO-High................................................             6.7              77              21             7.3              30              22
AEO-Low, 0 Month Payback................................              12             140              24              11              35              24
AEO-High, 24 Month Payback..............................             4.7              53             8.8             4.8              13             8.0
7pct Discount Rate......................................             9.2             110              11             5.2              17              12
50pct Owner/Operator Benefit............................             9.2             110             8.9             7.5              17             9.7
75pct Owner/Operator Benefit............................             9.2             110              13             7.5              22              14
Low SCC.................................................             9.2             110              18             7.5              23              16
High SCC................................................             9.2             110              18             7.5              28              21
Very High SCC...........................................             9.2             110              18             7.5              34              27
5pct Rebound............................................             9.7             110              19             6.6              26              20
15pct Rebound...........................................             8.8             100              17             8.5              26              18
25pct Rebound...........................................             8.0              92              15              10              26              16
5th Percentile Mass Fatality Coefficient................             9.2             110              18             6.7              26              19
95th Percentile Mass Fatality Coefficient...............             9.2             110              18             8.7              26              18
No SHEV-P2's............................................             9.3             110              18             7.5              26              19
Non-CO[ihel2]eq GHG Values..............................             9.2             110              18             7.5              26              19
ICM-Based Mark-Up.......................................             8.7             100              17             6.3              25              18
High-VMT................................................              10             110              19             7.6              28              20
Low-VMT.................................................             8.5              98              16             6.5              24              18
--------------------------------------------------------------------------------------------------------------------------------------------------------

(9) Discussion of the Maximum Feasibility of the Adopted Standards
    As noted above, EPCA and EISA require NHTSA to ``implement a 
commercial medium- and heavy-duty on-highway vehicle and work truck 
fuel efficiency improvement program designed to achieve the maximum 
feasible improvement'' and to establish corresponding fuel consumption 
standards ``that are appropriate, cost-effective, and technologically 
feasible.'' \511\ In order to determine which of the regulatory 
alternatives meets the requirements of the statute NHTSA has considered 
both the modeling results of ``Method A'' and comments offered on the 
proposed rulemaking.
---------------------------------------------------------------------------

    \511\ 49 U.S.C. 32902(k)(2).
---------------------------------------------------------------------------

(a) Consideration of Modeling Results
    For both the NPRM and the current analysis of potential standards 
for HD pickups and vans, NHTSA applied NHTSA's CAFE Compliance and 
Effects Modeling System (sometimes referred to as ``the CAFE model'' or 
``the Volpe model''), which DOT's Volpe National Transportation Systems 
Center (Volpe Center) developed, maintains, and applies to support 
NHTSA CAFE analyses and rulemakings. NHTSA used this model in its 
Method A analysis to evaluate regulatory alternatives for Phase 2 
standards applicable to HD pickups and vans, and used results of this 
analysis to inform its selection of the regulatory alternative that 
will achieve the maximum feasible improvement in HD pickup and van fuel 
efficiency. This analysis includes several updates to the model and to 
accompanying inputs, as discussed above in this section.
    In the proposal, the agencies proposed to adopt Alternative 3 from 
among the five regulatory alternatives under consideration.\512\ As 
discussed in the NPRM, the agencies found that Alternative 2 would 
unduly forego significant fuel savings and avoided GHG emissions, and 
that Alternative 5 could involve rapid and early cost increases and 
necessitate significant application of the most advanced technologies 
considered by the agencies. 80 FR 40494-40495. The agencies have 
estimated the cost and efficacy of fuel-saving technologies assuming 
performance and utility will be held constant or improved. In 
particular, we have assumed payload will be preserved (and possibly 
improved via reduced vehicle curb weight); however, some fuel-saving 
technologies, such as hybrid electric vehicles, could reduce payload 
via increased curb weight (due to the added electrical machine, 
batteries and controls, and because of the physical size of those 
components). If the increase in weight from the hybrid system is not 
offset with a weight reduction elsewhere in the vehicle, the payload 
capability will be reduced resulting in lost utility but also an 
increase in stringency due to changes in work factor. Further, it is 
also possible that applications such as vans where the advanced 
technologies of downsized gasoline and diesel engines could be used in 
conjunction with strong hybridization, extended high power demand 
resulting from a vehicle at full payload or towing, certain types of 
hybrid powertrains could experience a temporary loss of towing capacity 
if the capacity of the hybrid's energy storage device (e.g., batteries, 
hydraulic accumulator) is insufficient for the

[[Page 73799]]

extended power demand required to maintain expected vehicle speeds.
---------------------------------------------------------------------------

    \512\ These Alternatives are defined in Section C(6).
---------------------------------------------------------------------------

    The Method A analysis shows in the short term, MY 2017-2021 
timeframe, that there are significant differences in the rate at which 
technologies would need to be applied among the alternatives. NHTSA 
believes the rates of technology application require for Alternatives 4 
and 5 are beyond maximum feasible when considering the availability of 
manufacturers' resources and capital to implement the technologies in 
that timeframe, and that Alternatives 4 and 5 would not provide 
adequate lead time for the industry to fully address reliability 
considerations.
    Like the NPRM analysis (i.e. the Method B analysis), Method A 
indicates Alterative 4 would achieve little benefit beyond that 
achieved by Alternative 3. For example, as shown in the following graph 
of estimated total fuel consumed by HD pickups and vans over time under 
the various regulatory alternatives, outcomes under Alternative 4 are 
nearly indistinguishable from those under Alternative 3. By 2030, the 
two are less than 0.5 percent apart.
[GRAPHIC] [TIFF OMITTED] TR25OC16.035

    Weighing against the small additional benefit estimated to be 
potentially available under Alternative 4, NHTSA also considered the 
estimated additional costs. Method A analysis shows overall incremental 
costs (i.e., costs beyond the No Action Alternative) under Alternative 
4 to be about 12 percent more than under Alternative 3.
    As mentioned above, these estimated differences were mostly small 
on a relative basis. Averaged over all model years included in the 
analysis, estimated incremental costs are $106 higher under Alternative 
4 than under Alternative 3. For Daimler and General Motors, there is 
little or no estimated difference in costs under these two 
Alternatives. For FCA, Ford, and Nissan, differences are somewhat 
larger, averaging $120, $173, and $272, respectively. However, as 
explained in greater detail above, NHTSA's method A analysis shows 
considerably greater total and average additional costs in earlier 
model years under Alternative 4 than under Alternative 3.
    Although NHTSA's Method A analysis also indicates that some 
manufacturers could need to apply additional technology as soon as MY 
2016 under baseline standards defining the No-Action Alternative, 
average estimated costs (versus continuation today's technology) in MY 
2017 are two thirds more under Alternative 4 than under the No Action 
Alternative.
    Beyond these directly-estimated costs, the agencies also considered 
factors beyond those addressed quantitatively in either the NPRM 
analysis or the updated analysis. In general, these other factors 
reflect risk and uncertainty involved with standards for HD pickups and 
vans. These risks and uncertainty appear considerably greater than for 
light-duty vehicles. The HD pickup and van market has significantly 
fewer vehicle models than the light-duty market making forecasting 
uncertainty a greater risk to compliance. All current manufacturers of 
HD pickups and vans also produce light-duty vehicles. These 
manufacturers' light-duty offerings span wide ranges of models, 
configurations, shared vehicle platforms, engines, transmissions, and 
design schedules. As a result, if some specific aspects of production 
do not progress as initially planned for light-duty vehicles (e.g., if 
mass reduction on some platform does not achieve as much benefit as 
planned, or if a new engine does not perform as

[[Page 73800]]

well as projected, or if limited engineering resources make it 
necessary to delay a redesign), these manufacturers should have ample 
opportunity to comply with light-duty CAFE and GHG standards by making 
adjustments among other models, platforms, engines, and transmissions. 
This is not the case for HD pickups and vans. Current HD PUV 
manufacturers offer products spanning only 1-3 platforms, at most half 
a dozen engines or transmissions, and only 1-3 schedules for redesigns. 
As summarized below, this provides 5-10 times less flexibility than for 
light-duty vehicles.

                            Table VI-26--MY 2015 Body and Engine Platforms by Manufacturer for Light- and Heavy-Duty Pickups
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Platforms                  Engines                Transmissions           Design Schedules
                                                 -------------------------------------------------------------------------------------------------------
                                                   Light-duty     HD PUV     Light-duty     HD PUV     Light-duty     HD PUV     Light-duty     HD PUV
--------------------------------------------------------------------------------------------------------------------------------------------------------
Daimler.........................................           12            1           29            2           20            2           18            1
FCA.............................................           15            3           24            5           21            6           24            3
Ford............................................            9            2           22            5           27            3           18            2
General Motors..................................           17            2           26            5           39            3           21            2
Nissan..........................................            6            1           13            2           21            2           23            1
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Considering further that credits from other manufacturers are not 
potentially available as for light-duty vehicles (e.g., several 
manufacturers currently have excess light-duty CAFE credits that could 
be traded to other OEMs), this means that overestimating the industry's 
capability to improve fuel efficiency and reduce GHG emissions, and 
consequently setting standards at too stringent of a level, poses a 
much greater compliance risk for HD PUV fleets than for light-duty 
fleets. If the factors discussed here, for which the agencies are 
currently unable to account in our analysis, lead manufacturers to fail 
to comply with the standards, then the additional benefits of setting 
standards at slightly more stringent levels would be lost. In the 
agencies' judgment, even setting aside the somewhat higher estimated 
costs under Alternative 4, the very small additional benefit that could 
be achieved under Alternative 4 do not warrant the increased exposure 
to this risk.
    Regarding Alternative 5, the Method A analysis shows somewhat 
greater benefits than under Alternatives 3 or 4, but Alternative 5 
entails considerably greater costs and dependence on strong hybrid 
technology, as well as even greater exposure to the above-mentioned 
uncertainties and risks. Under the Method A analysis for Alternative 5, 
incremental costs averaged across all model years considered are 
estimated to be about $400 higher (about 46 percent) than under 
Alternative 3, and that analysis shows an overall fleet application of 
approximately 7 percent strong hybrids, with General Motors applying 
approximately 13 percent and Ford approximately 7 percent.
    We have also assumed that fuel-saving technologies will be no more 
or less reliable than technologies already in production. However, if 
there is insufficient lead-time to fully develop new technologies, they 
could prove to be less reliable, perhaps leading to increased repair 
costs and out-of-service time. If the fuel-saving technologies 
considered here ultimately involve reliability problems, overall costs 
will be greater than we have estimated. Method A analysis shows in the 
short term, MYs 2017-2021 timeframe, there are significant differences 
in the rate at which technologies would need to be applied among the 
alternatives. Figures VI.15 and VI.16, above, shows the progression in 
average and total technology costs and the rate of increase in those 
costs among the alternatives using Method A. They highlight the 
increases in resources and capital that would be required to implement 
the technologies required to comply with each of the alternatives, as 
well as the reduction in lead time to implement the technologies which 
increases reliability risk. As discussed further above in the 
manufacturer-specific effects, Ford and FCA are estimated to redesign 
vehicles in MYs 2017 and 2018 respectively, and vehicle designs for 
those model years are complete or nearly complete. The next estimated 
redesign for Ford is in MY 2026, and for FCA in MY 2025, and 
substantial resources and very high costs would be required to add 
another vehicle redesign between the estimated redesign model years to 
implement the technologies that would be needed to comply with those 
alternatives.
(b) Consideration of Comments
    NHTSA proposed that Alternative 3 represented the maximum feasible 
alternative under EISA, and EPA proposed that Alternative 3 reflected a 
reasonable consideration of the statutory factors of technology 
effectiveness, feasibility, cost, lead time, and safety for purposes of 
CAA sections 202(a)(1) and (2). Although the agencies and commenters 
also found that Alternative 4 merited serious consideration, the 
agencies noted that Alternative 3 was generally designed to achieve the 
levels of fuel consumption and GHG stringency that Alternative 4 would 
achieve, but with several years of additional lead time, meaning that 
manufacturers could, in theory, apply new technology at a more gradual 
pace, with greater reliability and flexibility.
    Some comments on the proposal called for adoption of standards more 
stringent and/or more rapidly advancing in stringency than those 
defining Alternative 3. For example, CARB argued that Alternative 4 
would, compared to Alternative 3, achieve greater benefits comparably 
attractive in terms of cost effectiveness and while remaining less 
stringent than CAFE standards for light-duty trucks.\513\ UCS provided 
similar comments, indicating further that the standards should be 
technology forcing and therefore more aggressive than Alternative 4, 
they specifically suggested that gasoline vehicles could achieve up to 
a 23.6 percent improvement in MY 2027 while diesel vehicles can achieve 
an 18 percent improvement.\514\ ACEEE similarly recommended increasing 
the stringency by 7 percent in MY 2027 and that standards should 
reflect increased use of cylinder deactivation, cooled EGR, and GDI and 
turbo downsizing in pickups. For diesels, ACEEE commented that 
additional reductions were possible, based on an estimate of 10 percent 
penetration of engine downsizing for pickups and 30 percent penetration 
for vans in 2027, and also assuming 6 percent penetration of hybrids in 
diesel vans.
---------------------------------------------------------------------------

    \513\ CARB, Docket No. NHTSA-2014-0132-0125 at pages 52-53.
    \514\ UCS, Docket No. EPA-HQ-OAR-2014-0827-1329, at pages 23-25.
---------------------------------------------------------------------------

    Citing the potential for fuel-saving technology to migrate from 
light-duty

[[Page 73801]]

pickups and vans to heavy-duty pickups and vans, CBD also called for 
more stringent HD pickup and van standards that would ``close the gap'' 
with light-duty standards, as any gap allows manufacturers to 
essentially choose to classify a pickup as heavy-duty to avoid more 
stringent requirements if it was classified as a light-duty 
vehicle.\515\ ICCT likewise commented that the proposed standards 
represent only a 2.2 and 1.6 percent year-over-year improvement for the 
gasoline and diesel fleets, respectively, from MYs 2014-2025 compared 
to an almost 3 percent per year improvement for light-duty trucks in 
the same time frame. ICCT recommended that the agencies' analysis 
incorporate the full analysis and inputs from the light-duty rulemaking 
and that the result would be improvements in the range of 35 percent 
over the MYs 2014-2025 rather than the proposed 23 percent improvement 
over this time frame.
---------------------------------------------------------------------------

    \515\ CBD, Docket No. NHTSA-2014-0132-0101, at pages 8-9.
---------------------------------------------------------------------------

    On the other hand, some other reviewers commented that the proposed 
standards could be unduly aggressive considering the products and 
technologies involved. GM commented that any attempt to force more 
stringent regulations than proposed, such as Alternative 4, would be 
extremely detrimental to manufacturers, consumers, the U.S. economy, 
and the millions of transportation-related jobs. Daimler similarly 
commented that the proposed standards would be a challenge for 
automotive manufacturers. Under certain conditions, such a standard may 
necessitate hybridization of the affected vehicle fleet, which would 
require substantial development and material costs. All technologies 
taken into account for the class 2b/3 stringencies should reflect cost 
effectiveness calculations, especially alternative powertrains such as 
hybrids, battery, and fuel cell driven electric vehicles. Daimler 
recommends that the agencies adopt the proposed standard over 
Alternative 4, as the additional two years of lead-time will be 
critical for automotive manufacturers in developing the necessary 
technologies to achieve compliance. Nissan commented that the 
Alternative 4 3.5 percent per stringency level is simply not feasible, 
as it does not provide the necessary lead-time to enable manufacturers 
to balance competitive market constraints with the cost of applying new 
technologies to a limited product offering. Nissan further commented 
that to the extent that the more stringent alternative is predicated on 
the adoption of hybrid and electric powertrain technology, Nissan does 
not believe that such technology is feasible for this market segment.
    The American Automotive Policy Council (AAPC, representing FCA, 
Ford, and General Motors) further commented that proposals for greater 
stringency than Alternative 3 are not supportable given the required 
early introduction of unproven technologies with their associated 
consumer acceptance risk, as well as the many implicit risks that 
impact stringency. AAPC commented that the proposed standards are 
aggressive and will challenge industry. AAPC noted that the baseline 
fleet includes a high percentage of advanced diesel technology such as 
SCR, making additional improvements considerably more challenging. In 
the light-duty fleet, diesel technology accounts for 3 percent of fleet 
whereas the heavy-duty fleet consists of over 50 percent diesel.
    AAPC also noted that Phase 2 technologies are being used today. For 
example, FCA's modern gasoline engine has robust combustion with 
multiple spark plugs, variable cam phasing, cylinder deactivation, and 
cooled EGR. AAPC commented that even with this level of gasoline engine 
technology, FCA is challenged by the early year Phase 1 standards and 
will need to look at adding even more technology for Phase 2. AAPC also 
provided data showing that while smaller displacement boosted gasoline 
engine technology may be applicable in some variants of commercial 
vans, this technology is not suited for the pickup truck variants in 
this segment because of customer demands for towing capability. AAPC 
commented that concurrent stringency increases in Tier 3/LEV III 
criteria emission requirements will negatively impact CO2 
and fuel consumption. As an alternative to the standards proposed in 
the NPRM, the American Automotive Policy Council (AAPC, representing 
FCA, Ford, and General Motors) proposed standards that would achieve 
the stringency by model year 2027, but that would do so at a more 
gradual pace.\516\ As means of providing flexibility in complying with 
these standards, AAPC also commented that the agencies should allow 
credits to be banked for longer than 5 years, and should allow credits 
to be transferred between the light- and heavy-duty fleets.\517\
---------------------------------------------------------------------------

    \516\ AAPC, Docket No.NHTSA-2014-0132-0103 ], at pages 12-13.
    \517\ AAPC, Docket No. NHTSA-2014-0132-0103 at pages 13-16.
---------------------------------------------------------------------------

(c) Determination
    Having considered these comments as well as the updated analysis 
summarized above, NHTSA is adopting standards under which the 
stringency of fuel consumption standards for HD pickups and vans 
advance at an annual rate of 2.5 percent during model years 2021-2027 
relative to the 2018 MY Phase 1 standard level. In NHTSA's judgment, 
this pace of stringency increase will appropriately accommodate 
manufacturers' redesign workload and product schedules, especially in 
light of this sector's limited product offerings \518\ and long product 
cycles. Given the provided flexibility to carry credits forward (and 
back) between model years, this approach strikes a balance between, on 
one hand, meaningful early fuel efficiency improvements and, on the 
other, providing manufacturers appropriate lead time.
---------------------------------------------------------------------------

    \518\ Manufacturers generally have only one pickup platform and 
one van platform in this segment.
---------------------------------------------------------------------------

    Compared to Alternative 3, Alternative 2 would forego significant 
cost-efficient opportunities to apply conventional and moderately 
advanced technology in order to reduce fuel consumption and emissions. 
Also, although the updated analysis summarized above shows costs for 
Alternative 3 (as costs incremental to the No Action Alternative) 
somewhat higher than estimated in the NPRM analysis, the agencies find 
that under either the Method A or Method B analyses, AAPC's proposed 
more gradual progression leading up to MY 2027 would also forego cost-
effective improvements which are readily feasible in the lead time 
provided. Furthermore, the Method A analysis indicates that the 
standards defining Alternative 3 can likely be met with minimal 
reliance on hybrid technologies. Considering this, NHTSA also find it 
unnecessary to extend the lifespan of banked credits or adopt other 
credit related flexibilities to mitigate the stringency increases under 
Alternative 3.

E. Analysis of the Regulatory Alternatives for HD Pickups and Vans: 
Method B

    Section 202(a)(1) and (2) of the Clean Air Act require EPA to 
establish standards for emissions of pollutants from new motor vehicles 
and engines which emissions cause or contribute to air pollution which 
may reasonably be anticipated to endanger public health or welfare, 
which include GHGs. See Section I.E. above. Under section 202(a)(1) and 
(2), EPA considers such

[[Page 73802]]

issues as technology effectiveness, its cost (both per vehicle, per 
manufacturer, and per consumer), the lead time necessary to implement 
the technology, and based on this the feasibility and practicability of 
potential standards; the impacts of potential standards on emissions 
reductions of both GHGs and non-GHG emissions; the impacts of standards 
on oil conservation and energy security; the impacts of standards on 
fuel savings by customers; the impacts of standards on the truck 
industry; other energy impacts; as well as other relevant factors such 
as impacts on safety.
    As part of the proposed feasibility analysis of potential standards 
for HD pickups and vans, the agencies applied NHTSA's CAFE Model. The 
agencies used this model to identify technology pathways that could be 
used to meet a range of stringencies, based on our projections of 
technology that will be available in the Phase 2 time frame. The 
agencies considered these technology pathways and identified the 
stringency level that will be technology-forcing (i.e. reflect levels 
of stringency based on performance of emerging as well as currently 
available control technologies) at reasonable cost, and leave 
manufacturers the flexibility to adopt varying technology paths for 
compliance and allow adequate lead time to develop, test, and deploy 
the range of technologies.
    As noted in Section I and discussed further below, the analyses 
consider two versions of the CAFE model, one updated for the NPRM 
analysis represented here in Method B, and one further updated for the 
FRM represented in the Method A analysis described in D immediately 
preceding this section. The results of both versions are reported 
relative to two baselines, a flat baseline (designated Alternative 1a) 
where no improvements are modeled beyond those needed to meet Phase 1 
standards and a dynamic baseline (designated Alternative 1b) where 
certain cost-effective technologies (i.e., those that payback within a 
6 month period) are assumed to be applied by manufacturers to improve 
fuel efficiency beyond the Phase 1 requirements in the absence of new 
Phase 2 standards. NHTSA considered its primary analysis to be based on 
the more dynamic baseline of Method A, whereas EPA considered the flat 
baseline of Method B. As shown below and in Sections VII through X, 
using the two different reference cases has little impact on the 
results of the analysis and leads to the same conclusion regarding the 
appropriateness of the Phase 2 standards. As such, the use of different 
reference cases corroborates the results of the overall analysis.
    For the NPRM, the agencies conducted coordinated and complementary 
analyses by employing both NHTSA's CAFE model and EPA's MOVES model and 
other analytical tools to project fuel consumption and GHG emissions 
impacts resulting from the Phase 2 standards for HD pickups and vans, 
against both the flat and dynamic baselines. EPA ran its MOVES model 
for all HD categories, namely tractors and trailers, vocational 
vehicles and HD pickups and vans, to develop a consistent set of fuel 
consumption and CO2 reductions for all HD categories. The 
MOVES runs followed largely the procedures described above, with some 
differences. MOVES used the same technology application rates and costs 
that are part of the inputs, and used cost per vehicle outputs of the 
CAFE model to evaluate the Phase 2 standards for HD pickup trucks and 
vans. The agencies note that these two independent analyses of 
aggregate costs and benefits both support these standards. For the 
final rule, NHTSA has conducted an analysis using a revised version of 
the CAFE model, as discussed in Section D. This analysis has been 
designated Method A. The EPA analysis based on the NPRM version of the 
CAFE model along with EPA's MOVES model is designated Method B.
    As noted earlier, the agencies are adopting as proposed a phase-in 
schedule of reduction of 2.5 percent per year in fuel consumption and 
CO2 levels relative to the 2018 MY Phase 1 standard level, 
starting in MY 2021 and extending through MY 2027. We continue to 
believe this phased-in implementation will appropriately accommodate 
manufacturers' redesign workload and product schedules, especially in 
light of this sector's limited product offerings \519\ and long product 
cycles. This approach was chosen to strike a balance between meaningful 
reductions in the early years and providing manufacturers with needed 
lead time via a gradually accelerating ramp-up of technology 
penetration. By expressing the phase-in in terms of increasing year to 
year stringency for each manufacturer, while also providing for credit 
generation and use (including averaging, carry-forward, and carry-
back), we believe our program will afford manufacturers substantial 
flexibility to satisfy the phase-in through a variety of pathways: The 
gradual application of technologies across the fleet, greater 
application levels on only a portion of the fleet, and a sufficiently 
broad set of available technologies to account for the variety of 
current technology deployment among manufacturers and the lowest-cost 
compliance paths available to each.
---------------------------------------------------------------------------

    \519\ Manufacturers generally have only one pickup platform and 
one van platform in this segment.
---------------------------------------------------------------------------

    EPA did not estimate the cost of implementing these standards 
immediately in 2021 without a phase-in, but we qualitatively assessed 
it to be somewhat higher than the cost of the phase-in we are 
establishing, due to the workload and product cycle disruptions it 
could cause, and also due to manufacturers' resulting need to develop 
some of these technologies for heavy-duty applications sooner than or 
simultaneously with light-duty development efforts. See 75 FR 25451 
(May 7, 2010) (documenting types of drastic cost increases associated 
with trying to accelerate redesign schedules and concluding that ``[w]e 
believe that it would be an inefficient use of societal resources to 
incur such costs when they can be obtained much more cost effectively 
just one year later''). On the other hand, waiting until 2027 before 
applying any new standards could miss the opportunity to achieve 
meaningful and cost-effective early reductions not requiring a major 
product redesign. Comments on the phase-in are discussed in Section 
B.2. and in the Response to Comments document.
    As noted above, at proposal, the agencies requested comment in 
particular on Alternative 4. EPA is not adopting Alternative 4 due to 
uncertainty regarding whether or not the potential technologies and 
market penetration rates included in Alternative 4 would be 
technologically feasible. Alternative 4 would ultimately reach the same 
levels of stringency as final Phase 2 standards, but would do so with 
less lead time. As discussed below, this could require application of 
both different technologies at higher application rates, neither of 
which may be feasible (or, at the least, reliable implementable) by MY 
2025.
    Moreover, the two years of additional lead time provided by the 
final standards compared to Alternative 4 eases compliance burden by 
having more vehicle redesigns and lower stringency during the phase-in 
period. As noted above, historically, the vehicles in this segment are 
typically only redesigned every 6-10 years, so many of the vehicles may 
not even be redesigned during the timeframe of the stringency increase. 
In this case, a manufacturer must either make up for any vehicle that 
falls short of its target through some combination of early compliance, 
over compliance, credit carry-forward and carry-back, and

[[Page 73803]]

redesigning vehicles more frequently. Each of these will increase 
technology costs to the manufacturers and vehicle purchasers, and early 
redesigns will significantly increase capital costs and product 
development costs. Also, the longer implementation time for the final 
standards means that any manufacturer will have a slightly lower target 
to meet from 2021-2026 than for the shorter phase-in of Alternative 4, 
though by 2027 the manufacturers will have the same target in either 
alternative.
    Due to the projected higher technology adoption rates, Alternative 
4 is also projected to result in higher costs, and risks of inadequate 
time to successfully test and integrate new technology, than the 
standards the agencies are adopting. Moreover, the additional emission 
reductions and fuel savings predominately occur only during the program 
phase-in period; from roughly 2030 on, the adopted standards and the 
pull-ahead alternative are projected to be equivalent from an 
environmental benefit standpoint. EPA's analysis and responses to 
comments are discussed in detail below.
    In some cases, the Method B (NPRM) version of the model selects 
strong hybrids as a more cost effective technology over certain other 
technologies including stop-start and mild hybrid. In other words, 
strong hybrids are not a technology of last resort in the analysis. 
Alternative 4 is projected to be met using a significantly higher 
degree of hybridization including the use of more strong hybrids, 
compared to the standards the agencies are finalizing. In order to 
comply with a 3.5 percent per year increase in stringency over MYs 
2021-2025, Method B modeling projects that manufacturers would need to 
adopt more technology compared to the 2.5 percent per year increase in 
stringency over MYs 2021-2027. The two years of additional lead time 
provided by the Phase 2 standards reduces the potential number of 
strong hybrids projected to be used by allowing for other more cost 
effective technologies to be more fully utilized across the fleet. EPA 
believes it is technologically feasible to apply this projected amount 
of hybridization to HD pickups and vans in the lead time provided 
(i.e., by MY 2027). However, strong hybrids present challenges in this 
market segment compared to light-duty where there are several strong 
hybrids already available. EPA does not believe that at this stage 
there is enough information about the viability of strong hybrid 
technology in this vehicle segment to assume that they can be a part of 
large-volume deployment strategies for regulated manufacturers. For 
example, EPA believes that hybrid electric technology could provide 
significant GHG and fuel consumption benefits, but recognize that there 
is uncertainty at this time over the real world effectiveness of these 
systems in HD pickups and vans, and over customer acceptance of the 
technology for vehicles with high GCWR towing large loads. Further, the 
development, design, and tooling effort needed to apply this technology 
to a vehicle model is quite large, and might not be cost-effective due 
to the small sales volumes relative to the light-duty sector.
    Additionally, EPA recognizes that sufficient engine horsepower and 
torque needed to meet towing objectives which are important to pickup 
truck buyers and accordingly the analysis does not down-size engines in 
conjunction with hybridization. See Section VI.C.4.iv above. Therefore, 
with no change projected for engine size, the strong hybrid costs do 
not include costs for engine changes. In light-duty, the use of smaller 
engines has an associated cost saving which facilitates much of a 
hybrid's cost-effectiveness. Section E.2 discusses these issues 
further, and explains further that the results of the updated CAFE 
model used in Method A are consistent with these conclusions.
    Due to these considerations in the NPRM and in the current Method B 
analysis, EPA has conducted a sensitivity analysis using the Method B 
version of the model that assumes the use of no strong hybrids. The 
results of the analysis are also discussed below. The analysis 
indicates that there will be a technology pathway that will allow 
manufacturers to meet the final standards without the use of strong 
hybrids. However, the analysis indicates that costs will be higher and 
the cost effectiveness will be lower under the no strong hybrid 
approach.
    EPA also analyzed less stringent standards under which 
manufacturers could comply by deploying a more limited set of 
technologies than are needed to meet the Phase 2 standards being 
adopted. However, our assessment concluded with a high degree of 
confidence that the technologies on which the final Phase 2 standards 
are premised will be available at reasonable cost in the 2021-2027 
timeframe, and that the phase-in and other flexibility provisions allow 
for their application in a very cost-effective manner, as discussed in 
this section below. Accordingly, it would be inappropriate (within the 
meaning of CAA section 202(a)(1) and (2)) to adopt standards of lesser 
stringency.
    More difficult to characterize is the degree to which more or less 
stringent standards might be appropriate because of under- or over-
estimating the costs or effectiveness of the technologies whose 
performance is the basis of the Phase 2 standards. For the most part, 
these technologies have not yet been applied to HD pickups and vans, 
even on a limited basis. EPA is therefore relying to some degree on 
engineering judgment in predicting their effectiveness. Even so, we 
believe that we have applied this judgment using the best information 
available, primarily from a NHTSA contracted study at SwRI \520\ and 
our recent rulemaking on light-duty vehicle GHGs and fuel economy, and 
have generated a robust set of effectiveness values. Chapter 10 of the 
RIA provides a detailed description of the CAFE Model and the analysis 
performed for the rule.
---------------------------------------------------------------------------

    \520\ Reinhart, T.E. (June 2015). Commercial Medium- and Heavy-
Duty Truck Fuel Efficiency Technology Study--Report #1. (Report No. 
DOT HS 812 146). Washington, DC: National Highway Traffic Safety 
Administration.
---------------------------------------------------------------------------

(1) Consistency of the Phase 2 Standards With the EPA's Legal Authority
    Table VI-27 below shows projected technology adoption rates for 
both the final Phase 2 standards and for a two-year pull ahead of those 
standards (i.e. Alternative 4 from the NPRM). As at proposal, the table 
shows that the Method B (EPA's central estimate) analysis estimates 
that the most cost-effective way to meet the final Phase 2 standards 
will be to use strong hybrids in up to 9.9 percent of pickups and 5.5 
percent of vans on an industry-wide basis. The analysis of Alternative 
4 shows strong hybrids on up to 19 percent of pickups (and two years 
sooner). The analysis shows that the two years of additional lead time 
provided by the Phase 2 standards compared to Alternative 4 will 
provide manufacturers with a better opportunity to maximize the use of 
technologies which are more cost effective than strong hybrids over 
time thereby reducing the need for strong hybrids which may be 
particularly challenging for this market segment, as well as providing 
needed time for the more limited deployment of this technology 
projected under alternative 3 (i.e. the Phase 2 standard).

[[Page 73804]]



 Table VI-27--Method B CAFE Model Technology Adoption Rates for the Final Phase 2 Standards Rule and Alternative
                                            4 Summary--Flat Baseline
----------------------------------------------------------------------------------------------------------------
                                                   Phase 2 standards  (2.5% per   Alternative 4  (3.5% per year)
                                                        year)  2021 to 2027                 2021 to 2025
                   Technology                    ---------------------------------------------------------------
                                                   Pickup trucks                   Pickup trucks
                                                         %            Vans  %            %            Vans  %
----------------------------------------------------------------------------------------------------------------
Low friction lubricants.........................             100             100             100             100
Engine friction reduction.......................             100             100             100             100
Cylinder deactivation...........................              22              19              22              19
Variable valve timing...........................              22              82              22              82
Gasoline direct injection.......................               0              63               0              80
Diesel engine improvements......................              60             3.6              60             3.6
Turbo downsized engine..........................               0              63               0              63
8 speed transmission............................              98              92              98              92
Low rolling resistance tires....................             100              92             100              59
Aerodynamic drag reduction......................             100             100             100             100
Mass reduction and materials....................             100             100             100             100
Electric power steering.........................             100              49             100              46
Improved accessories............................             100              87             100              36
Low drag brakes.................................             100              45             100              45
Stop/start engine systems.......................               0               0              15             1.5
Mild hybrid.....................................               0               0              29              15
Strong hybrid...................................             9.9             5.5              19               0
----------------------------------------------------------------------------------------------------------------

    As discussed earlier, EPA also conducted a sensitivity analysis 
using the Method B version of the model to determine a compliance 
pathway where no strong hybrids would be utilized. Although EPA in this 
Method B analysis, projects that strong hybrids may be the most cost 
effective approach, manufacturers may select another compliance path, 
mainly a 20 percent penetration rate of mild hybrids. This no strong 
hybrid analysis included the use of downsized turbocharged engines in 
vans currently equipped with large V-8 engines. Turbo-downsized engines 
were not allowed on 6+ liter gasoline vans in the primary analysis 
because EPA sought to preserve consumer choice with respect to vans 
that have large V-8s for towing. However, given the recent introduction 
of vans with considerable towing capacity and turbo-downsized engines, 
EPA believes it will be feasible for vans in the time-frame of these 
final rules. The tables below reflect the difference in predicted 
penetration rates of technologies if strong hybridization is not chosen 
as a technology pathway. For simplicity, pickup trucks and vans are 
combined into a single industry wide penetration rate.
    The table also shows that when strong hybrids are used as a pathway 
to compliance, penetration rates of all hybrid technologies would 
increase substantially between the Phase 2 standards and Alternative 4. 
The analysis predicts an increase in strong hybrid penetration from 8 
percent to 12 percent, a 23 percent penetration of mild hybrids and a 
10 percent penetration stop/start engine systems for Alternative 4 
compared with the Phase 2 standards (hence much of the increased 
projected cost between these options, as explained below). Also, by 
having the final standards apply in MY 2027 instead of MY 2025, the 
rule is not premised on use of any mild hybrids or stop/start engine 
systems. This analysis shows that the few years of additional lead time 
provided by the Phase 2 standards allows manufacturer's important 
flexibility in choosing a mix of technologies that is best suited for 
this market.

    Table VI-28--CAFE Method B Model Technology Adoption Rates for Final Phase 2 Standards and Alternative 4
                                 Combined Fleet and Fuels Summary--Flat Baseline
----------------------------------------------------------------------------------------------------------------
                                                   Phase 2 standards  (2.5% per   Alternative 4  (3.5% per year)
                                                        year)  2021 to 2027                 2021 to 2025
                                                 ---------------------------------------------------------------
                   Technology                                         Without                         Without
                                                    With strong       strong        With strong       strong
                                                    hybrids  %      hybrids  %      hybrids  %      hybrids  %
----------------------------------------------------------------------------------------------------------------
Low friction lubricants.........................             100             100             100             100
Engine friction reduction.......................             100             100             100             100
Cylinder deactivation...........................              21              22              21              14
Variable valve timing...........................              46              46              46              46
Gasoline direct injection.......................              25              45              31              45
Diesel engine improvements......................              38              38              38              38
Turbo downsized engine \a\......................              25              31              25              31
8 speed transmission............................              96              96              96              96
Low rolling resistance tires....................              97              97              84              84
Aerodynamic drag reduction......................             100             100             100             100
Mass reduction and materials....................             100             100             100             100
Electric power steering.........................              80              92              79              79
Improved accessories............................              67              77              75              75

[[Page 73805]]

 
Low drag brakes.................................              78              93              78              78
Stop/start engine systems.......................               0               1              10               4
Mild hybrid.....................................               0              20              23              66
Strong hybrid...................................               8               0              12               0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ The 6+ liter V8 vans were allowed to convert to turbocharged and downsized engines in the ``without strong
  hybrid'' analysis for both the Rule and the Alternative 4 to provide a compliance path.

    The tables Table VI-29 and Table VI-30 below provide a further 
breakdown of projected technology adoption rates specifically for 
gasoline-fueled pickups and vans which shows potential adoption rates 
of strong hybrids for each vehicle type. Strong hybrids are not 
projected to be used in diesel applications. The Alternative 4 analysis 
shows the use of strong hybrids in up to 48 percent of gasoline 
pickups, depending on the mix of strong and mild hybrids, and stop/
start engine systems in 20 percent of gasoline pickups (the largest 
gasoline HD segment). It is important to again note that this analysis 
only shows one pathway to compliance, and the manufacturers may make 
other decisions, e.g., changing the mix of strong vs. mild hybrids, or 
applying electrification technologies to HD vans instead.

   Table VI-29--CAFE Method B Model Technology Adoption Rates for Final Phase 2 Standards and Alternative 4 on
                                      Gasoline Pickup Trucks--Flat Baseline
----------------------------------------------------------------------------------------------------------------
                                                   Phase 2 standards  (2.5% per    Alternative 4 (3.5% per year)
                                                        year)  2021 to 2027                2021 to 2025
                                                 ---------------------------------------------------------------
                   Technology                                         Without                         Without
                                                    With strong       strong        With strong       strong
                                                    hybrids  %      hybrids  %      hybrids  %      hybrids  %
----------------------------------------------------------------------------------------------------------------
Low friction lubricants.........................             100             100             100             100
Engine friction reduction.......................             100             100             100             100
Cylinder deactivation...........................              56              56              56              56
Variable valve timing...........................              56              56              56              56
Gasoline direct injection.......................               0              56               0              56
8 speed transmission............................             100             100             100             100
Low rolling resistance tires....................             100             100             100             100
Aerodynamic drag reduction......................             100             100             100             100
Mass reduction and materials....................             100             100             100             100
Electric power steering.........................             100             100             100             100
Improved accessories............................             100             100             100             100
Low drag brakes.................................             100             100             100             100
Driveline friction reduction....................              44              68              68              68
Stop/start engine systems.......................               0               0              20               0
Mild hybrid.....................................    \a\ Up to 42               0       \a\ 18-86              86
Strong hybrid...................................        Up to 25  ..............        Up to 48
----------------------------------------------------------------------------------------------------------------
Note:
\a\ Depending on extent of strong hybrid adoption as hybrid technologies can replace each other, however they
  will have different effectiveness and costs.


   Table VI-30--CAFE Method B Model Technology Adoption Rates for Final Phase 2 Standards and Alternative 4 on
                                          Gasoline Vans--Flat Baseline
----------------------------------------------------------------------------------------------------------------
                                                   Phase 2 Standards  (2.5% per   Alternative 4  (3.5% per year)
                                                        year)  2021 to 2027                 2021 to 2025
                                                 ---------------------------------------------------------------
                   Technology                                         Without                         Without
                                                    With strong       strong        With strong       strong
                                                    hybrids  %      hybrids  %      hybrids  %      hybrids  %
----------------------------------------------------------------------------------------------------------------
Low friction lubricants.........................             100             100             100             100

[[Page 73806]]

 
Engine friction reduction.......................             100             100             100             100
Cylinder deactivation...........................              23               3              23               3
Variable valve timing...........................             100             100             100             100
Gasoline direct injection.......................              57              97              97              97
Turbo downsized engine \a\......................              77              97              77              97
8 speed transmission............................              97              97              97              97
Low rolling resistance tires....................             100             100              60              60
Aerodynamic drag reduction......................             100             100             100             100
Mass reduction and materials....................             100             100             100             100
Electric power steering.........................              55              85              53              53
Improved accessories............................              23              38              43              43
Low drag brakes.................................              53              89              53             100
Stop/start engine systems.......................               0               0               2               0
Mild hybrid.....................................    \b\ Up to 13              13              18              40
Strong hybrid...................................         Up to 7  ..............               0  ..............
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ The 6+ liter V8 vans were allowed to convert to turbocharged and downsized engines in the ``without strong
  hybrid'' analysis for both the Rule and the Alternative 4 to provide a compliance path.
\b\ Depending on extent of strong hybrid adoption as hybrid technologies can replace each other, however they
  will have different effectiveness and costs.

    EPA projects a compliance path for these standards showing 
aggressive implementation of technologies that the agencies consider to 
be available in the time frame of these rules. See Section VI.C.4. 
Under this approach, manufacturers are expected to implement these 
technologies at aggressive adoption rates on essentially all vehicles 
across this sector by 2027 model year. In the case of several of these 
technologies, adoption rates are projected to approach 100 percent. 
This includes a combination of engine, transmission and vehicle 
technologies as described in this section across every vehicle. The 
standard also is premised on less aggressive penetration of particular 
advanced technologies, including strong hybrid electric vehicles.
    EPA projects the Phase 2 standards to be achievable within known 
design cycles, and we believe these standards will allow different 
paths to compliance in addition to the one we outline and cost here. As 
discussed below and throughout this analysis, our rule places a high 
value on the assurance of in use reliability and market acceptance of 
new technology, particularly in initial model years of the program.
    The NPRM analysis did not predict substantial amounts of technology 
being added before the start of the MY 2021 standards, and in 
particular, did not project that there would be substantial additions 
of more advanced technologies in any redesign cycles occurring before 
MY 2021. This continues to appear to be a reasonable assumption, since 
substantial lead time is typically required to develop and implement 
these advanced technologies. Indeed, as the previous discussion shows 
(and as discussed again in responding to comments later in this 
section), it is important to provide two additional years of lead time 
between MY 2025 and 2027. More recent modeling used to update the NHTSA 
Method A analysis as described in Section C above allows for technology 
implementation in pre-2021 model years to both meet the final Phase 1 
standards in MY 2018 and to also begin to introduce advanced 
technologies that will eventually be needed in order to meet the Phase 
2 standards. EPA considered this more recent modeling approach with 
earlier redesign cycles and technology implementation and agrees with 
NHTSA that this modelling shows that there would be insufficient lead 
time to adopt the technologies to satisfy the compliance path modelled 
for Alternatives 4 and 5 in the Method A analysis. See Section VI.D.4 
above.
    As discussed above, the agencies sought comment on the feasibility 
and costs associated with the standards being finalized and also on 
alternative standards. In particular, the agencies sought comment on 
Alternative 4, which is based on a year-over-year increase in 
stringency of 3.5 percent in MYs 2021-2025, essentially pulling ahead 
the alternative 3 standard stringency by two model years. The agencies 
received several comments in support of more stringent standards. 
Several NGOs commented that more stringent standards than proposed are 
feasible through the additional application of technology and that the 
standards should more closely align with standards established for 
light-duty trucks. UCS commented that gasoline vehicles could achieve 
up to a 23.6 percent improvement in MY 2027 while diesel vehicles can 
achieve an 18 percent improvement. ACEEE similarly recommended 
increasing the stringency by 7 percent in MY 2027 and that standards 
should reflect increased use of cylinder deactivation, cooled EGR, and 
GDI and turbo downsizing in pickups. For diesels, ACEEE commented that 
additional reductions were possible, based on an estimate of 10 percent 
penetration of engine downsizing for pickups and 30 percent penetration 
for vans in 2027, and also assuming 6 percent penetration of hybrids in 
diesel vans. ICCT commented that the proposed standards represent only 
a 2.2 and 1.6 percent year-over-year improvement for the gasoline and 
diesel fleets, respectively, from MYs 2014-2025 compared to an almost 3 
percent per year improvement for light-duty trucks in the same time 
frame. ICCT recommended that the agencies' analysis incorporate the 
full analysis

[[Page 73807]]

and inputs from the light-duty rulemaking and that the result would be 
improvements in the range of 35 percent over the MYs 2014-2025 rather 
than the proposed 23 percent improvement over this time frame.
    The agencies also received comments that any gap between fuel 
economy requirements for LD and HD pickups for which there is no 
engineering rationale could produce distortions in the pickup market, 
shifting sales toward the heavier vehicles. The Center for Biological 
Diversity similarly commented that closing the gap between large light-
duty and heavy-duty pickups and vans is crucial because the overlap in 
many characteristics allows manufacturers to essentially choose to 
classify a pickup as ``heavy duty'' to avoid the more stringent 
requirements for ``light duty'' pickups through minor adjustments to 
the vehicle.
    CARB staff commented in support of Alternative 4, commenting that 
Alternative 4 is technologically feasible, cost-effective and superior 
to Alternative 3. CARB noted that the Alternative 4 adds only three to 
8 months to the payback period. CARB also commented that Alternative 4 
remains significantly less stringent than the light-duty truck 
standards. CARB further commented that Alternative 4 would result in 
greater emissions and societal benefits than Alternative 3.
    The agencies also received several comments opposing setting 
standards more stringent than those proposed, although none of these 
commenters opposed the actual proposal. AAPC commented that proposals 
for greater stringency than Alternative 3 are not supportable given the 
required early introduction of unproven technologies with their 
(purportedly) associated consumer acceptance risk, as well as the many 
implicit risks that impact stringency. AAPC commented that, in their 
view, the proposed standards are aggressive and will challenge 
industry. AAPC noted that the baseline fleet (which is over 50 percent 
diesel) includes a high percentage of advanced diesel technology such 
as SCR, making additional improvements more challenging. AAPC also 
noted that Phase 2 technologies are being used today. For example, 
FCA's modern gasoline engine has robust combustion with multiple spark 
plugs, variable cam phasing, cylinder deactivation, and cooled EGR. 
AAPC commented that even with this level of gasoline engine technology, 
FCA is challenged by the early year Phase 1 standards and will need to 
look at adding even more technology for Phase 2. AAPC also provided 
data showing that while smaller displacement boosted gasoline engine 
technology may be applicable in some variants of commercial vans, this 
technology is not suited for the pickup truck variants in this segment 
because of customer demands for towing capability. AAPC commented that 
concurrent stringency increases in Tier 3/LEV III criteria emission 
requirements will negatively impact CO2 and fuel 
consumption.
    GM commented that any attempt to force more stringent regulations 
than proposed, such as Alternative 4, would be extremely detrimental to 
manufacturers, consumers, the U.S. economy, and the millions of 
transportation-related jobs. Daimler similarly commented that the 
proposed standards would be a challenge for automotive manufacturers. 
According to the commenter, under certain conditions, a more stringent 
standard than proposed may necessitate hybridization of the affected 
vehicle fleet, which would require substantial development and material 
costs. Daimler recommends that EPA adopt the proposed standard over 
Alternative 4, as the additional two years of lead-time will be 
critical for automotive manufacturers in developing the necessary 
technologies to achieve compliance. Nissan commented that Alternative 4 
at 3.5 percent per year stringency level is simply not feasible, as it 
does not provide the necessary lead-time to enable manufacturers to 
balance competitive market constraints with the cost of applying new 
technologies to a limited product offering. Nissan further commented 
that to the extent that the more stringent alternative is predicated on 
the adoption of hybrid and electric powertrain technology, Nissan does 
not believe that such technology is feasible for this market segment.
    After considering the comments, EPA believes that the Phase 2 final 
standards that the agencies are adopting represent the most stringent 
standards reasonably achievable within the MY 2021-2027 period. The 
standards are based largely on the same technologies projected to be 
used in the light-duty fleet with appropriate adjustments for the 
heavy-duty fleet because of their specific higher load duty cycles. As 
shown in the tables 28 and 29 above and repeated below, several 
technologies are projected to be used at very high adoption rates at or 
near 100 percent including mass reduction, 8-speed transmissions, 
engine friction reduction, low rolling resistant tires, improved 
accessories, and aerodynamic drag reductions. For gasoline engines, 
some commenters noted that downsize turbo engines which are projected 
to be used extensively in light-duty vehicles should also be relied on 
in the heavy-duty analysis, including for HD pickups. As discussed in 
VI.C.4.vii above, the agencies agree with the comments provided by AAPC 
that turbo downsizing is likely to be counter-productive in heavy-duty 
pickups. EPA (and NHTSA in the Method A analysis) thus is projecting 
the use of downsized turbo engines only for vans. Under heavy loads, 
turbo downsized engines may have higher CO2 and fuel 
consumption than the engine it replaces. For this reason, EPA continues 
to believe that the technology can only be projected to be available 
for heavy-duty vans (and not pickups) and, for vans, is projecting its 
use at 77 to 97 percent. One commenter argued for a standard predicated 
on a more aggressive penetration rate for cylinder deactivation noting 
that in the NPRM the agencies only projected cylinder deactivation at 
an adoption rate of 22 percent of the overall fleet. The commenter 
believes that an adoption rate of 40 percent would be more appropriate. 
In response, cylinder deactivation is a gasoline engine technology and 
EPA is projecting an adoption rate of 56 percent for pickups and an 
adoption rate of essentially 100 percent for the gasoline engines in 
vans not projected to be downsized turbo engines (i.e. a more 
aggressive penetration rate than urged by the commenter).
    EPA also remains concerned about projecting standards predicated on 
high levels of hybridization in the heavy-duty pickup and van fleet. 
Many heavy duty applications need maximum payload and cargo volume 
which may compete with weight increases and lost cargo volume from 
hybridization, directly reducing the capability and therefore work 
factor of the vehicle. Additionally, it is likely not feasible to size 
a hybridization system to be effective for any high or maximum payload 
or towing operation without changing the utility of the vehicle. A 
manufacturer choosing to hybridize a heavy duty vehicle would likely 
target vans that are primarily used for cargo volumetric capacity 
reasons where a reasonably sized hybrid system could be incorporated 
and be effective under typical operation. EPA believes that the final 
Phase 2 standards will drive the orderly use of technology while still 
providing enough lead time that manufacturers could meet the standards 
using technology paths other than high penetration rates of strong 
hybrids. Thus, the gap in stringency between

[[Page 73808]]

light-duty trucks and the Phase 2 standards for HD pickups and vans 
reflects constraints of the use of some technologies in the heavy-duty 
market resulting from the intended use of the vehicles to do more work 
than light-duty trucks.
    The proposed rule discussed several considerations that EPA 
believes remain valid. The NPRM projected that the higher rate of 
increase in stringency associated with Alternative 4 and the shorter 
lead time would necessitate the use of a different technology mix under 
Alternative 4 compared to the Phase 2 standards that the agencies are 
adopting. The Phase 2 standards are projected to achieve the same final 
stringency increase as Alternative 4 at about 80 percent of the average 
per-vehicle cost increase, and without the expected deployment of more 
advanced technology at high penetration levels. In particular, under 
EPA's primary analysis, which does not constrain the use of strong 
hybrids, manufacturers are estimated to deploy strong hybrids in 
approximately 8 percent of new vehicles (in MY 2027) under the Phase 2 
standards, compared to 12 percent under Alternative 4 (in MY 2025). 
Less aggressive electrification technologies also appear on 33 percent 
of new vehicles simulated to be produced in MY 2027 under Alternative 
4, but are not projected to be necessary under the Phase 2 standards. 
Additionally, it is important to note that due to the shorter lead time 
of Alternative 4, there are fewer vehicle refreshes and redesigns 
during the phase-in period of MY 2021-2025. The longer, shallower 
phase-in of advanced technologies in the standards that the agencies 
are adopting allows for more compliance flexibility and closer matching 
with the vehicle redesign cycles, which (as noted above) can be up to 
ten years for HD vans. While the Method B CAFE model's algorithm 
accounts for manufacturers' consideration of upcoming stringency 
changes and credit carry-forward, the steeper ramp-up of the standard 
in Alternative 4, coupled with the five-year credit life, results in a 
prediction that manufacturers would need to take less cost-effective 
means to comply with the standards compared with the final phase-in 
period of MY 2021-2027. The public comments from industry commenters 
confirmed that this is a realistic prediction. For example, the Method 
B model predicts that some manufacturers will not implement any amount 
of strong hybrids on their vans during the 2021-2025 timeframe and 
instead will implement less effective technologies such as mild hybrids 
at higher penetration rates. There is also a high degree of sensitivity 
to the estimated effectiveness levels of individual technologies. At 
high penetration rates of all technologies on a vehicle, the result of 
a reduced effectiveness of even a single technology could be non-
compliance with the standards. If the standards do not account for this 
uncertainty, there will be a real possibility that a manufacturer who 
followed the exact technology path we project will not meet their 
target because a technology performed slightly differently in their 
application. In this Method B analysis, EPA considered all comments 
regarding Alternative 4 and concluded that the longer lead time 
provided by the Phase 2 standards that the agencies are adopting is 
necessary as it better matches the redesign cycles for vehicles in this 
market segment and provides the time necessary for manufacturers to 
more fully utilize a range of technologies best suited for this market 
segment. These technologies are projected to be available within the 
lead time provided under the Phase 2 standards--i.e., by MY 2027, as 
discussed in RIA Chapter 2.6. These standards will require a relatively 
aggressive implementation schedule of most of these technologies during 
the program phase-in. Heavy-duty pickups and vans will need to have a 
combination of many individual technologies to achieve these standards. 
These standards are projected to yield significant emission and fuel 
consumption reductions without requiring a large segment transition to 
strong hybrids, a technology that while successful in light-duty 
passenger cars, cross-over vehicles and SUVs, may impact vehicle work 
capabilities \521\ and have questionable customer acceptance in a large 
portion of this segment dedicated to towing.\522\ See discussion above 
and in Section VI.D.9.
---------------------------------------------------------------------------

    \521\ As noted earlier, hybrid batteries, motors and electronics 
generally add weight to a vehicle and require more space which can 
result in conflicts with payload weight and volume objectives.
    \522\ Hybrid electric systems are not sized for situations when 
vehicles are required to do trailer towing where the combined weight 
of vehicle and trailer is 2 to 4 times that of the vehicle alone. 
During these conditions, the hybrid system will have reduced 
effectiveness. Sizing the system for trailer towing is prohibitive 
with respect to hybrid component required sizes and the availability 
of locations to place larger components like batteries.
---------------------------------------------------------------------------

    The tables above show that many technologies will be at or 
potentially approach 100 percent adoption rates according to the 
analysis. If certain technologies turn out to be not well suited for 
certain vehicle models or less effective that projected, other 
technology pathways will be needed. The additional lead time provided 
by the Phase 2 standards reduces these concerns because manufacturers 
will have more flexibility to implement their compliance strategy and 
are more likely to do so within a product redesign cycle necessary for 
many new technologies to be implemented.
    The agencies also received comments that the standards should be 
based exclusively on the GHG capabilities of diesel vehicles. The 
commenters viewed the separate gasoline and diesel standards as 
preferential treatment of gasoline-powered vehicles which have 
inherently higher GHG and fuel consumption. As discussed in Section 
B.1, the agencies are maintaining the separate gasoline and diesel 
standards for heavy duty pickups and vans. As discussed earlier, diesel 
engines are fundamentally more efficient than gasoline engines 
providing the same power (even gasoline engines with the technologies 
discussed above) while using less fuel. However, dieselization is not a 
technology path the agencies included in the analysis for the Phase 1 
rule or the Phase 2 rules. Gasoline-powered vehicles account for nearly 
half of the heavy-duty pickup and van market and are used in 
applications where a diesel may not make sense from a cost or consumer 
choice standpoint. Commenters did not address the costs of extensive 
dieselization.
    More stringent standards, including Alternative 4, could result in 
manufacturers switching from gasoline engines to diesel engines in 
certain challenging segments. While technologically feasible, EPA 
remains concerned that this pathway could cause a distortion in 
consumer choices and significantly increase the cost of those vehicles, 
particularly considering that more stringent standards are projected to 
require penetration of some form of hybridization. Also, the agencies 
did not consider the impact dieselization would have on lead-time, as 
shifting nearly half the market from gasoline to diesel engines would 
require substantial retooling of production. Commenters also did not 
account for the costs or address the feasibility of such retooling in 
the lead time available under either Phase 2 or Alternative 4. In 
addition, if dieselization occurs by manufacturers equipping vehicles 
with larger diesel engines designed for broad coverage of applications 
typical of this sector rather than ``right-sized'' engines, the towing 
capability of the vehicles could increase, resulting in higher work 
factors for the vehicles, higher targets, and reduced program benefits. 
Bosch commented that holding gasoline vehicles to the same GHG 
standards as

[[Page 73809]]

diesels would bring the costs of compliance with all emissions 
standards, including criteria pollutant standards, for gasoline 
vehicles more in line with diesels, considering the costs of complying 
with criteria pollutant standards are much higher for diesels compared 
to gasoline vehicles. In response, EPA's Method B analysis shows that 
significantly more stringent gasoline vehicle GHG standards may require 
high levels of hybridization which, as discussed above, may not be 
acceptable for this market segment. This, in turn, could lead to 
dieselization, as manufacturers would opt to phase out gasoline-fueled 
vehicles rather than opt for widespread hybridization of their product 
offerings. EPA continues to believe that it is reasonable to adopt 
Phase 2 standards that continue to preserve the opportunity for 
manufacturers to produce and consumers to choose gasoline-powered 
vehicles in this market segment.
    Based on the information presented here in this Method B analysis, 
EPA believes that the Phase 2 standards the agencies are finalizing are 
appropriate within the meaning of CAA section 202(a)(1), for this 
segment for the model years in question. EPA believes the standards 
reflect a reasonable consideration of the statutory factors of 
technology effectiveness, feasibility, cost, lead time, and safety for 
purposes of CAA sections 202(a)(1) and (2). The standards are 
appropriately technology-forcing, predicated on performance of 
technologies not only currently deployed but those which reasonably can 
be developed during the phase in period. EPA has indicated how 
technologies not currently deployed in this sector can be reliably 
commercialized in the lead time provided by the standard. See above and 
RIA Chapter 2.5 ``Technology Application'' where the individual 
technologies available during the phase-in are described in detail. 
Note that advanced technologies like strong hybridization will require 
several years of development prior to commercialization to meet 
required reliability and durability goals in this sector. As noted, the 
Method B analysis projects that the additional lead-time provided by 
the Phase 2 standards allows for the implement CO2-reducing 
technologies without the need for significant hybridization and at a 
significantly lower cost compared to Alternative 4, as shown in the 
tables above.
    EPA has also carefully considered the costs of the standards. The 
technologies associated with meeting the Phase 2 standards are 
estimated to add costs to heavy-duty pickups and vans as shown in Table 
VI-31 for the flat baseline. These costs are the average fleet-wide 
incremental vehicle costs relative to a vehicle meeting the MY 2018 
standard in each of the model years shown. Reductions associated with 
these costs and technologies are considerable, estimated at a 16 
percent reduction of fuel consumption and CO2eq emissions 
from the MY 2018 baseline for gasoline and diesel engine equipped 
vehicles.\523\ As shown by the analysis, the long-term cost 
effectiveness of the rule is similar to that of the Phase 1 HD pickup 
and van standards (found by the agencies to be highly cost effective, 
without consideration of payback), and also falls within the range of 
the cost effectiveness for Phase 2 standards for the other HD 
sectors.\524\ The agencies have already found costs in this range to be 
cost effective (including for the heavy duty pickup and van sector), 
independent of the associated fuel savings. 76 FR 57228. EPA reiterates 
that finding here. Moreover, the cost of controls reflected in 
potential increased vehicle cost will be fully recovered by the 
operator due to the associated fuel savings, with a payback period 
somewhere in the third year of ownership, as shown in Section IX.M of 
this Preamble. The rules' projected benefits far exceed costs (see 
IX.K), and costs are actually projected to be negative when fuel 
savings are considered.
---------------------------------------------------------------------------

    \523\ See Table VI-27.
    \524\ Analysis using the MOVES model indicates that the cost 
effectiveness of these standards is $95 per ton CO2 eq 
removed in MY 2030 (RIA Table 7-31), almost identical to the $90 per 
ton CO2 eq removed (MY 2030) which the agencies found to 
be highly cost effective for these same vehicles in Phase 1. See 76 
FR 57228.
---------------------------------------------------------------------------

    Consistent with EPA's authority under 42 U.S.C. 7521(a) and based 
on its Method B analysis, EPA is thus finalizing the Phase 2 standards 
as proposed.

                   Table VI-31--HD Pickups and Vans Incremental Technology Costs per Vehicle Final Phase 2 Standards vs. Flat Baseline
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                               2018       2019       2020       2021       2022       2023       2024       2025       2026       2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
NPRM (2012$)..............................       $112       $104       $106       $516       $508       $791       $948     $1,161     $1,224     $1,342
FRM (2013$)...............................        114        105        108        524        516        804        963      1,180      1,244      1,364
--------------------------------------------------------------------------------------------------------------------------------------------------------

(2) HD Pickups and Vans Industry Impacts (Method B)
    The analysis fleet provides a starting point for estimating the 
extent to which manufacturers might add fuel-saving (and, therefore, 
CO2-avoiding) technologies under various regulatory 
alternatives, including the no-action alternative that defines a 
baseline against which to measure estimated impacts of new standards. 
The analysis fleet is a forward-looking projection of production of new 
HD pickups and vans, holding vehicle characteristics (e.g., technology 
content and fuel consumption levels) constant at model year 2014 
levels, and adjusting production volumes based on recent DOE and 
commercially-available forecasts. This analysis fleet includes some 
significant changes relative to the market characterization that was 
used to develop the Phase 1 standards applicable starting in model year 
2014; in particular, the analysis fleet includes some new HD vans 
(e.g., Ford's Transit and Fiat Chrysler's Promaster) that are 
considerably more fuel-efficient than HD vans these manufacturers have 
previously produced for the U.S. market.
    While the Phase 2 standards are scheduled to begin in model year 
2021, the requirements they define are likely to influence 
manufacturers' planning decisions several years in advance. This is 
true in light-duty planning, and is accentuated by the comparatively 
long redesign cycles and small number of models and platforms offered 
for sale in the 2b/3 market segment. Additionally, manufacturers will 
respond to the cost and efficacy of available fuel consumption 
improvements, the price of fuel, and the requirements of the Phase 1 
standards that specify maximum allowable average fuel consumption and 
GHG levels for MY 2014-MY 2018 HD pickups and vans (the final standard 
for MY 2018 is held constant for model years 2019 and

[[Page 73810]]

2020). The forward-looking nature of product plans that determine which 
vehicle models will be offered in the model years affected by these 
standards lead to additional technology application to vehicles in the 
analysis fleet that occurs in the years prior to the start of these 
standards. From the industry perspective, this means that manufacturers 
will incur costs to comply with these standards in the baseline and 
that the total cost of the regulations will include some costs that 
occur prior to their start, and represent incremental changes over a 
world in which manufacturers will have already modified their vehicle 
offerings compared to today.

 Table VI-32--MY 2021 Method B Baseline Costs for Manufacturers in 2b/3
        Market Segment in the Dynamic Baseline, or Alternative 1b
------------------------------------------------------------------------
                                                  Average     Total cost
                 Manufacturer                    technology    increase
                                                 cost  ($)       ($m)
------------------------------------------------------------------------
Fiat Chrysler.................................          275           27
Daimler.......................................           18            0
Ford..........................................          258           78
General Motors................................          782          191
Nissan........................................          282            3
Industry......................................          442          300
------------------------------------------------------------------------

    As Table VI-32 shows, the industry as a whole is expected to add 
about $440 of new technology to each new vehicle model by 2021 under 
the no-action alternative defined by the Phase 1 standards. Reflecting 
differences in projected product offerings in the analysis fleet, some 
manufacturers (notably Daimler) are significantly less constrained by 
the Phase 1 standards than others and face lower cost increases as a 
result. General Motors (GM) shows the largest increase in average 
vehicle cost, but results for GM's closest competitors (Ford and Fiat 
Chrysler) do not include the costs of their recent van redesigns, which 
are already present in the analysis fleet (discussed in greater detail 
below).
    The above results reflect the assumption that manufacturers having 
achieved compliance with standards might act as if buyers are willing 
to pay for further fuel consumption improvements that ``pay back'' 
within 6 months (i.e., those improvements whose incremental costs are 
exceeded by savings on fuel within the first six months of ownership). 
It is also possible that manufacturers will choose not to migrate cost-
effective technologies to the 2b/3 market segment from similar vehicles 
in the light-duty market. Resultant technology costs in model year 2021 
results for the no-action alternative, summarized in Table VI-33 below, 
are quite similar to those shown above for the 6-month payback period. 
Due to the similarity between the two baseline characterizations, 
results in the following discussion represent differences relative to 
only the 6-month payback baseline.

 Table VI-33--MY 2021 Method B Baseline Costs for HD Pickups and Vans in
                  the Flat Baseline, or Alternative 1a
------------------------------------------------------------------------
                                                  Average     Total cost
                 Manufacturer                    technology    increase
                                                 cost  ($)       ($m)
------------------------------------------------------------------------
Fiat Chrysler.................................          268           27
Daimler.......................................            0            0
Ford..........................................          248           75
General Motors................................          767          188
Nissan........................................          257            3
Industry......................................          431          292
------------------------------------------------------------------------

    The results below represent the impacts of several regulatory 
alternatives, including those defined by the Phase 2 standards, as 
incremental changes over the baseline, where the baseline is defined as 
the state of the world in the absence of this regulatory action (but, 
of course, including the Phase 1 standards). Large-scale, macroeconomic 
conditions like fuel prices are constant across all alternatives, 
including the baseline, as are the fuel economy improvements under the 
no-action alternative defined by the Phase 1 rule that covers model 
years 2014-2018 and is constant from model year 2018 through 2020. In 
the baseline scenario, the Phase 1 standards are assumed to remain in 
place and at 2018 levels throughout the analysis (i.e. MY 2030). The 
only difference between the definitions of the alternatives is the 
stringency of these standards starting in MY 2021 and continuing 
through either MY 2025 or MY 2027, and all of the differences in 
outcomes across alternatives are attributable to differences in the 
standards.
    The standards vary in stringency across regulatory alternatives (1-
5), but as discussed above, all of the standards are based on the curve 
developed in the Phase 1 standards that relate fuel economy and GHG 
emissions to a vehicle's work factor. The alternatives considered here 
represent different rates of annual increase in the curve defined for 
model year 2018, growing from a 0 percent annual increase (Alternative 
1, the baseline or ``no-action'' alternative) up to a 4 percent annual 
increase (Alternative 5). Table VI-34 shows a summary \525\ of outcomes 
by alternative incremental to the baseline (Alternative 1b) for Model 
Year 2030 \526\, with the exception of technology penetration rates, 
which are absolute.
---------------------------------------------------------------------------

    \525\ NHTSA generated hundreds of outputs related to economic 
and environmental impacts, each available technology, and the costs 
associated with the rule. A more comprehensive treatment of these 
outputs appears in Chapter 10 of the RIA.
    \526\ As noted above, the NHTSA CAFE model estimates that 
redesign schedules will ``straddle'' model year 2027, the latest 
year for which the agencies are increasing the stringency of fuel 
consumption and GHG standards. Considering also that today's 
analysis estimates some earning and application of ``carried 
forward'' compliance credits, the model was run extending the 
analysis through model year 2030.
---------------------------------------------------------------------------

    The technologies applied as inputs to the CAFE model (in either its 
Method B or A iterations) have been grouped (in most cases) to give 
readers a general sense of which types of technology are applied more 
frequently than others, and are more likely to be offered in new class 
2b/3 vehicles once manufacturers are fully compliant with the standards 
in the alternative. Model year 2030 was chosen to account for 
technology application that occurs once the standards have stabilized, 
but manufacturers are still redesigning products to achieve 
compliance--generating technology costs and benefits in those model 
years. The summaries of technology penetration are also intended to 
reflect the relationship between technology application and cost 
increases across the alternatives. The table rows present the degree to 
which specific technologies are predicted to be present in new class 2b 
and class 3 vehicles in 2030, and correspond to: Variable valve timing 
(VVT) and/or variable valve lift (VVL), cylinder deactivation, direct 
injection, engine turbocharging, 8-speed automatic transmissions, 
electric power-steering and accessory improvements, micro-hybridization 
(which reduces engine idle, but does not assist propulsion), full 
hybridization (integrated starter generator or strong hybrid that 
assists propulsion and recaptures braking energy), and aerodynamic 
improvements to the vehicle shape. In addition to the technologies in 
the following tables, there are some lower-complexity technologies that 
have high market penetration across all the alternatives and 
manufacturers; low rolling-resistance tires, low friction lubricants, 
and reduced engine friction are examples.

[[Page 73811]]



    Table VI-34--Summary of HD Pickups and Vans Alternatives' Impact on Industry Versus the Dynamic Baseline,
                                            Alternative 1b; Method B
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
Annual Stringency Increase......................          2.0%/y          2.5%/y          3.5%/y          4.0%/y
Stringency Increase Through MY..................            2025            2027            2025            2025
Total Stringency Increase.......................            9.6%           16.2%           16.3%           18.5%
----------------------------------------------------------------------------------------------------------------
                                     Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required........................................           19.04           20.57           20.57           21.14
Achieved........................................           19.14           20.61           20.83           21.27
----------------------------------------------------------------------------------------------------------------
                                   Average Fuel Consumption (gallons/100 mi.)
----------------------------------------------------------------------------------------------------------------
Required........................................            5.25            4.86            4.86            4.73
Achieved........................................            5.22            4.85            4.80            4.70
----------------------------------------------------------------------------------------------------------------
                                     Average Greenhouse Gas Emissions (g/mi)
----------------------------------------------------------------------------------------------------------------
Required........................................             495             458             458             446
Achieved........................................             491             458             453             444
----------------------------------------------------------------------------------------------------------------
                                           Technology Penetration (%)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................              46              46              46              46
Cylinder Deac...................................              29              21              21              21
Direct Injection................................              17              25              31              32
Turbocharging...................................              55              63              63              63
8-Speed AT......................................              67              96              96              97
EPS, Accessories................................              54              80              79              79
Stop Start......................................               0               0              10              13
Hybridization \a\...............................               0               8              35              51
Aero. Improvements..............................              36              78              78              78
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
CW (lb.)........................................             239             243             325             313
CW (%)..........................................             3.7             3.7             5.0             4.8
----------------------------------------------------------------------------------------------------------------
                                         Technology Cost (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Average ($) \b\.................................             578           1,348           1,655           2,080
Total ($m) \c\..................................             437           1,019           1,251           1,572
Payback period (m) \c\..........................              25              31              34              38
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Includes mild hybrids (ISG) and strong HEVs.
\b\ Values used in Methods A & B
\c\ Values used in Method A, calculated using a 3% discount rate.

    In general, as stated above, the Method B model projected that the 
standards will cause manufacturers to produce HD pickups and vans that 
are lighter, more aerodynamic, and more technologically complex across 
all the alternatives. As Table VI-34 shows, there is a difference 
between the relatively small increases in required fuel economy and 
average incremental technology cost between the alternatives, 
suggesting that the challenge of improving fuel consumption and 
CO2 emissions accelerates as stringency increases (i.e., 
that there may be a ``knee'' in the relationship between technology 
cost and reductions in fuel consumption/GHG emissions).
    The contrast between alternatives 3 and 4 is even more prominent, 
with an identical required fuel economy improvement projected to lead 
to price increases greater than 20 percent based on the more rapid rate 
of increase and shorter time span of Alternative 4, which achieves all 
of its increases by MY 2025 while Alternative 3 continues to increase 
at a slower rate until MY 2027. Despite these differences, the increase 
in average payback period when moving from Alternative 3 to Alternative 
4 to Alternative 5 is fairly constant at around an additional three 
months for each jump in stringency.
    Manufacturers offer few models, typically only a pickup truck and/
or a cargo van, and while there are a large number of variants of each 
model, the degree of component sharing across the variants can make 
diversified technology application either economically impractical or 
impossible. This forces manufacturers to apply some technologies more 
broadly in order to achieve compliance than they might do in other 
market segments (passenger cars, for example). This difference between 
broad and narrow application--where some technologies must be applied 
to entire platforms, while some can be applied to individual model 
variants--also explains why certain technology penetration rates 
decrease between alternatives of increasing stringency (cylinder 
deactivation or mass reductions in Table VI-34, for example). For those 
cases, narrowly applying a more advanced (and costly) technology can be 
a more cost effective path to compliance and lead to reductions in the 
amount of

[[Page 73812]]

lower-complexity technology that is applied.
    As noted in Section E.1 above, one driver of the change in 
technology cost between Alternative 3 and Alternative 4 in the Method B 
analysis is the amount of hybridization projected to result from the 
implementation of the standards. While only about 5 percent full 
hybridization (defined as either integrated starter-generator or strong 
hybrid) is expected to be needed to comply with Alternative 3, the 
higher rate of increase and compressed schedule moving from Alternative 
3 to Alternative 4 is enough to increase the percentage of the fleet 
adopting full hybridization by a factor of two. To the extent that 
manufacturers are concerned about introducing hybrid vehicles in the 2b 
and 3 market, it is worth noting that new vehicles subject to 
Alternative 3 achieve the same fuel economy as new vehicle subject to 
Alternative 4 by 2030, with less full hybridization projected under 
this Method B analysis as being needed to achieve the improvement.
    The alternatives also lead to important differences in outcomes at 
the manufacturer level, both from the industry average and from each 
other. General Motors, Ford, and Fiat Chrysler, are expected to have 
approximately 95 percent of the 2b/3 new vehicle market during the 
years that these standards are being phased in. Due to their importance 
to this market and the similarities between their model offerings, 
these three manufacturers are discussed together and a summary of the 
way each is impacted by the standards appears below in Table VI-35, 
Table VI-36 and Table VI-37 for General Motors, Ford, and Fiat 
Chrysler, respectively.

  Table VI-35--Summary of Impacts on General Motors by 2030 in the HD Pickup and Van Market Versus the Dynamic
                                            Baseline, Alternative 1b
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
Annual Stringency Increase......................          2.0%/y          2.5%/y          3.5%/y          4.0%/y
Stringency Increase Through MY..................            2025            2027            2025            2025
----------------------------------------------------------------------------------------------------------------
                                     Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required........................................           18.38           19.96              20           20.53
Achieved........................................           18.43           19.95           20.24           20.51
----------------------------------------------------------------------------------------------------------------
                                   Average Fuel Consumption (gallons/100 mi.)
----------------------------------------------------------------------------------------------------------------
Required........................................            5.44            5.01               5            4.87
Achieved........................................            5.42            5.01            4.94            4.87
----------------------------------------------------------------------------------------------------------------
                                     Average Greenhouse Gas Emissions (g/mi)
----------------------------------------------------------------------------------------------------------------
Required........................................             507             467             467             455
Achieved........................................             505             468             461             455
----------------------------------------------------------------------------------------------------------------
                                           Technology Penetration (%)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................              64              64              64              64
Cylinder Deac...................................              47              47              47              47
Direct Injection................................              18              18              36              36
Turbocharging...................................              53              53              53              53
8-Speed AT......................................              36             100             100             100
EPS, Accessories................................             100             100             100             100
Stop Start......................................               0               0               2               0
Hybridization...................................               0              19              79             100
Aero. Improvements..............................             100             100             100             100
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
CW (lb.)........................................             325             161             158             164
CW (%)..........................................             5.3             2.6             2.6             2.7
----------------------------------------------------------------------------------------------------------------
                                         Technology Cost (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Average ($) \a\.................................             785           1,706           2,244           2,736
Total ($m, undiscounted) \b\....................             214             465             611             746
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Values used in Methods A & B.
\b\ Values used in Method A, calculated at a 3% discount rate.


  Table VI-36--Summary of Impacts on Ford by 2030 in the HD Pickup and Van Market Versus the Dynamic Baseline,
                                                 Alternative 1b
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
Annual Stringency Increase......................          2.0%/y          2.5%/y          3.5%/y          4.0%/y
Stringency Increase Through MY..................            2025            2027            2025            2025
----------------------------------------------------------------------------------------------------------------

[[Page 73813]]

 
                                     Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required........................................           19.42           20.96           20.92           21.51
Achieved........................................            19.5           21.04           21.28            21.8
----------------------------------------------------------------------------------------------------------------
                                   Average Fuel Consumption (gallons/100 mi.)
----------------------------------------------------------------------------------------------------------------
Required........................................            5.15            4.77            4.78            4.65
Achieved........................................            5.13            4.75            4.70            4.59
----------------------------------------------------------------------------------------------------------------
                                     Average Greenhouse Gas Emissions (g/mi)
----------------------------------------------------------------------------------------------------------------
Required........................................             485             449             450             438
Achieved........................................             482             447             443             433
----------------------------------------------------------------------------------------------------------------
                                           Technology Penetration (%)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................              34              34              34              34
Cylinder Deac...................................              18               0               0               0
Direct Injection................................              16              34              34              34
Turbocharging...................................              51              69              69              69
8-Speed AT......................................             100             100             100             100
EPS, Accessories................................              41              62              59              59
Stop Start......................................               0               0              20              29
Hybridization...................................               0               2              14              30
Aero. Improvements..............................               0              59              59              59
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
CW (lb.)........................................             210             202             379             356
CW (%)..........................................             3.2               3             5.7             5.3
----------------------------------------------------------------------------------------------------------------
                                         Technology Cost (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Average ($) \a\.................................             506           1,110           1,353           1,801
Total ($m, undiscounted) \b\....................             170             372             454             604
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Values used in Methods A & B.
\b\ Values used in Method A, calculated at a 3% discount rate.


   Table VI-37--Summary of Impacts on Fiat Chrysler by 2030 in the HD Pickup and Van Market Versus the Dynamic
                                            Baseline, Alternative 1b
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
Annual Stringency Increase......................          2.0%/y          2.5%/y          3.5%/y          4.0%/y
Stringency Increase Through MY..................            2025            2027            2025            2025
----------------------------------------------------------------------------------------------------------------
                                     Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required........................................           18.73           20.08           20.12           20.70
Achieved........................................           18.83           20.06           20.10           20.70
----------------------------------------------------------------------------------------------------------------
                                   Average Fuel Consumption (gallons/100 mi.)
----------------------------------------------------------------------------------------------------------------
Required........................................            5.34            4.98            4.97            4.83
Achieved........................................            5.31            4.99            4.97            4.83
----------------------------------------------------------------------------------------------------------------
                                     Average Greenhouse Gas Emissions (g/mi)
----------------------------------------------------------------------------------------------------------------
Required........................................             515             480             479             466
Achieved........................................             512             481             480             467
----------------------------------------------------------------------------------------------------------------
                                           Technology Penetration (%)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................              40              40              40              40
Cylinder Deac...................................              23              23              23              23
Direct Injection................................              17              17              17              17
Turbocharging...................................              74              74              74              74
8-Speed AT......................................              65              88              88              88
EPS, Accessories................................               0             100             100             100

[[Page 73814]]

 
Stop-Start......................................               0               0               0               0
Hybridization...................................               0               3               3              10
Aero. Improvements..............................               0             100             100             100
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
CW (lb.)........................................             196             649             648             617
CW (%)..........................................             2.8             9.1             9.1             8.7
----------------------------------------------------------------------------------------------------------------
                                         Technology Cost (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Average ($) \a\.................................             434           1,469           1,486           1,700
Total ($m, undiscounted) \b\....................              48             163             164             188
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Values used in Methods A & B.
\b\ Values used in Method A, calculated at a 3% discount rate.

    The fuel consumption and GHG standards require manufacturers to 
achieve an average level of compliance, represented by a sales-weighted 
average across the specific targets of all vehicles offered for sale in 
a given model year, such that each manufacturer will have a unique 
required consumption/emissions level determined by the composition of 
its fleet, as illustrated above. However, there are more interesting 
differences than the small differences in required fuel economy levels 
among manufacturers. In particular, the average incremental technology 
cost increases with the stringency of the alternative for each 
manufacturer, but the size of the cost increase from one alternative to 
the next varies among them, with General Motors showing considerably 
larger increases in cost moving from Alternative 3 to Alternative 4, 
than from either Alternative 2 to Alternative 3 or Alternative 4 to 
Alternative 5. Ford is estimated to have more uniform cost increases 
from each alternative to the next, in increasing stringency, though 
still benefits from the reduced pace and longer period of increase 
associated with Alternative 3 compared to Alternative 4.
    The Method B simulation results show all three manufacturers facing 
cost increases when the stringency of the standards move from 2.5 
percent annual increases over the period from MY 2021-2027 to 3.5 
percent annual increases from MY 2021-2025, but General Motors has the 
largest at 75 percent more than the industry average price increase for 
Alternative 4. GM also faces higher cost increases in Alternative 2 
about 50 percent more than either Ford or Fiat Chrysler. And for the 
most stringent alternative considered, EPA estimates that General 
Motors will face average cost increases of more than $2,700, in 
addition to the more than $700 increase in the baseline--approaching 
nearly $3,500 per vehicle over today's prices.
    Technology choices also differ by manufacturer, and some of those 
decisions are directly responsible for the largest cost discrepancies. 
For example, in this Method B analysis, GM is estimated to engage in 
the least amount of mass reduction among the Big 3 after Phase 1, and 
much less than Fiat Chrysler, but reduces average vehicle mass by over 
300 lbs. in the baseline--suggesting that some of GM's easiest Phase 1 
compliance opportunities can be found in lightweighting technologies. 
Similarly, Fiat Chrysler is projected to apply less hybridization than 
the others, and much less than General Motors, which is simulated in 
Alternative 4 to have full hybrids (either integrated starter generator 
or complete hybrid system) on all of its fleet by 2030, nearly 20 
percent of which will be strong hybrids, and the strong hybrid share 
decreases to about 18 percent in Alternative 5, as some lower level 
technologies are applied more broadly. Because the analysis applies the 
same technology inputs and the same logic for selecting among available 
opportunities to apply technology, the unique situation of each 
manufacturer determined which technology path is projected as the most 
cost-effective.
    In order to understand the differences in incremental technology 
costs and fuel economy achievement across manufacturers in this market 
segment, it is important to understand the differences in their 
starting position relative to these standards. One important factor, 
made more obvious in the following figures, is the difference between 
the fuel economy and performance of the recently redesigned vans 
offered by Fiat Chrysler and Ford (the Promaster and Transit, 
respectively), and the more traditionally-styled vans that continue to 
be offered by General Motors (the Express/Savannah). In MY 2014, Ford 
began the phase-out of the Econoline van platform, moving those volumes 
to the Euro-style Transit vans (discussed in more detail in Section 
VI.D.2). The Transit platform represents a significant improvement over 
the existing Econoline platform from the perspective of fuel economy, 
and for the purpose of complying with the standards, the relationship 
between the Transit's work factor and fuel economy is a more favorable 
one than the Econoline vans it replaces. Since the redesign of van 
offerings from both Fiat Chrysler and Ford occur in (or prior to) the 
2014 model year, the costs, fuel consumption improvements, and 
reductions of vehicle mass associated with those redesigns are included 
in the analysis fleet, meaning they are not carried forward as part of 
the compliance modeling exercise. By contrast, General Motors is 
simulated to redesign their van offerings after 2014, such that there 
is a greater potential for these vehicles to incur additional costs 
attributable to new standards, unlike the costs associated with the 
recent redesigns of their competitors. The inclusion of these new Ford 
and Fiat Chrysler products in the analysis fleet is the primary driver 
of the cost discrepancy between GM and its competitors in both the 
baseline and Alternative 2 in this Method B analysis, when Ford and 
Fiat Chrysler have to apply considerably less technology to achieve 
compliance.
    The remaining 5 percent of the 2b/3 market is attributed to two 
manufacturers, Daimler and Nissan,

[[Page 73815]]

which, unlike the other manufacturers in this market segment, only 
produce vans. The vans offered by both manufacturers currently utilize 
two engines and two transmissions, although both Nissan engines are 
gasoline engines and both Daimler engines are diesels. Despite the 
logical grouping, these two manufacturers are projected to be impacted 
much differently by these standards. For the least stringent 
alternative considered, Daimler is projected to add no technology and 
incurs no incremental cost in order to comply with the standards. At 
stringency increases greater than or equal to 3.5 percent per year, 
Daimler only really improves some of their transmissions and improves 
the electrical accessories of its Sprinter vans. By contrast, Nissan's 
starting position is much weaker and their compliance costs closer to 
the industry average in Table VI-34. This difference could increase if 
the analysis fleet supporting the final rule includes forthcoming 
Nissan HD pickups.

 Table VI-38--Summary of Impacts on Daimler by 2030 in the HD Pickup and Van Market Versus the Dynamic Baseline,
                                                 Alternative 1b
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
Annual Stringency Increase......................          2.0%/y          2.5%/y          3.5%/y          4.0%/y
Stringency Increase Through MY..................            2025            2027            2025            2025
----------------------------------------------------------------------------------------------------------------
                                     Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required........................................           23.36           25.19           25.25           25.91
Achieved........................................           25.23           25.79           25.79           26.53
----------------------------------------------------------------------------------------------------------------
                                   Average Fuel Consumption (gallons/100 mi.)
----------------------------------------------------------------------------------------------------------------
Required........................................            4.28            3.97            3.96            3.86
Achieved........................................            3.96            3.88            3.88            3.77
----------------------------------------------------------------------------------------------------------------
                                     Average Greenhouse Gas Emissions (g/mi)
----------------------------------------------------------------------------------------------------------------
Required........................................             436             404             404             393
Achieved........................................             404             395             395             384
----------------------------------------------------------------------------------------------------------------
                                           Technology Penetration (%)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................               0               0               0               0
Cylinder Deac...................................               0               0               0               0
Direct Injection................................               0               0               0               0
Turbocharging...................................              44              44              44              44
8-Speed AT......................................               0              44              44             100
EPS, Accessories................................               0               0               0               0
Stop-Start......................................               0               0               0               0
Hybridization...................................               0               0               0               0
Aero. Improvements..............................               0               0               0               0
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
CW (lb.)........................................               0               0               0               0
CW (%)..........................................               0               0               0               0
----------------------------------------------------------------------------------------------------------------
                                         Technology Cost (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Average ($) \a\.................................               0             165             165             374
Total ($m, undiscounted) \b\....................               0               4               4               9
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Values used in Methods A & B.
\b\ Values used in Method A, calculated at a 3% discount rate.


 Table VI-39--Summary of Impacts on Nissan by 2030 in the HD Pickup and Van Market Versus the Dynamic Baseline,
                                                 Alternative 1b
----------------------------------------------------------------------------------------------------------------
                   Alternative                           2               3               4               5
----------------------------------------------------------------------------------------------------------------
Annual Stringency Increase......................          2.0%/y          2.5%/y          3.5%/y          4.0%/y
Stringency Increase Through MY..................            2025            2027            2025            2025
----------------------------------------------------------------------------------------------------------------
                                     Average Fuel Economy (miles per gallon)
----------------------------------------------------------------------------------------------------------------
Required........................................           19.64           21.19           20.92           21.46
Achieved........................................           19.84           21.17           21.19           21.51
----------------------------------------------------------------------------------------------------------------
                                   Average Fuel Consumption (gallons/100 mi.)
----------------------------------------------------------------------------------------------------------------
Required........................................            5.09           44.72            4.78            4.66

[[Page 73816]]

 
Achieved........................................            5.04            4.72            4.72            4.65
----------------------------------------------------------------------------------------------------------------
                                     Average Greenhouse Gas Emissions (g/mi)
----------------------------------------------------------------------------------------------------------------
Required........................................             452             419             425             414
Achieved........................................             448             419             419             413
----------------------------------------------------------------------------------------------------------------
                                           Technology Penetration (%)
----------------------------------------------------------------------------------------------------------------
VVT and/or VVL..................................             100             100             100             100
Cylinder Deac...................................              49              49              49              49
Direct Injection................................              51              51              51             100
Turbocharging...................................              51              51              51              50
8-Speed AT......................................               0              51              51              51
EPS, Accessories................................               0             100             100             100
Stop-Start......................................               0               0               0               0
Hybridization...................................               0               0               0              28
Aero. Improvements..............................               0             100             100             100
----------------------------------------------------------------------------------------------------------------
                                         Mass Reduction (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
CW (lb.)........................................               0               0             307             303
CW (%)..........................................               0               0               5             4.9
----------------------------------------------------------------------------------------------------------------
                                         Technology Cost (vs. No-Action)
----------------------------------------------------------------------------------------------------------------
Average ($) \a\.................................             378           1,150           1,347           1,935
Total ($m, undiscounted) \b\....................               5            15.1            17.7            25.4
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ Values used in Methods A & B.
\b\ Values used in Method A, calculated at a 3% discount rate.

    As Table VI-38 and Table VI-39 show, Nissan is projected to apply 
more technology than Daimler in the less stringent alternatives and 
significantly more technology with increasing stringency. The Euro-
style Sprinter vans that comprise all of Daimler's model offerings in 
this segment put Daimler in a favorable position. However, those vans 
are already advanced--containing downsized diesel engines and advanced 
aerodynamic profiles. Much like the Ford Transit vans, the recent 
improvements to the Sprinter vans occurred outside the scope of the 
compliance modeling so the costs of the improvements are not captured 
in the analysis.
    Although Daimler's required fuel economy level is much higher than 
Nissan's (in miles per gallon), Nissan starts from a much weaker 
position than Daimler and must incorporate additional engine, 
transmission, platform-level technologies (e.g., mass reduction and 
aerodynamic improvements) in order to achieve compliance. In fact, more 
than 25 percent of Nissan's van offerings are projected to contain 
integrated starter generators by 2030 in Alternative 5.
    While the model does not allow sales volumes for any manufacturer 
(or model) to vary across regulatory alternatives in the analysis, it 
is conceivable that under the most stringent alternatives individual 
manufacturers could lose market share to their competitors if the 
prices of their new vehicles rise more than the industry average 
without compensating fuel savings and/or changes to other features.

F. Compliance and Flexibility for HD Pickup and Van Standards

(1) Averaging, Banking, and Trading
    The Phase 1 program established substantial flexibility in how 
manufacturers can choose to implement EPA and NHTSA standards while 
preserving the benefits for the environment and for energy consumption 
and security. Primary among these flexibilities are the gradual phase-
in schedule, and the corporate fleet average approach which encompasses 
averaging, banking and trading described below. See Section IV.A. of 
the Phase 1 Preamble (76 FR 57238) for additional discussion of the 
Phase 1 averaging, banking, and trading and Section IV.A (3) of the 
Phase 1 Preamble (76 FR 57243) for a discussion of the credit 
calculation methodology.
    Manufacturers in this category typically offer gasoline and diesel 
versions of HD pickup and van vehicle models. The agencies established 
chassis-based Phase 1 standards that are equivalent in terms of 
stringency for gasoline and diesel vehicles and are continuing this 
same approach to stringency for Phase 2. In Phase 1, the agencies 
established that HD pickups and vans are treated as one large averaging 
set that includes both gasoline and diesel vehicles \527\ and the 
agencies will maintain this averaging set approach for Phase 2, as 
discussed above in Section VI.B.
---------------------------------------------------------------------------

    \527\ See 40 CFR 1037.104(d) and the proposed 40 CFR 86.1819-
14(d). Credits may not be transferred or traded between this vehicle 
averaging set and loose engines or other heavy-duty categories, as 
discussed in Section I.
---------------------------------------------------------------------------

    As explained in Section II.C.(3) of the Phase 1 Preamble (76 FR 
57167), and in Section VI.B (3) above, the program is structured so 
that final compliance is determined at the end of each model year, when 
production for the model year is complete. At that point, each 
manufacturer calculates production-weighted fleet average 
CO2 emission and fuel consumption rates along with its 
production-weighted fleet average standard. Under this approach, a 
manufacturer's HD pickup and van fleet that achieves a fleet average 
CO2 or fuel consumption level better than its

[[Page 73817]]

standard will be allowed to generate credits. Conversely, if the fleet 
average CO2 or fuel consumption level does not meet its 
standard, the fleet will incur debits (also referred to as a 
shortfall).
    A manufacturer whose fleet generates credits in a given model year 
will have several options for using those credits to offset emissions 
from other HD pickups and vans. These options include credit carry-
back, credit carry-forward, and credit trading within the HD pickup and 
van averaging set. These types of credit provisions also exist in the 
light-duty 2012-2016 and 2017-2025 MY vehicle rules, as well as many 
other mobile source standards issued by EPA under the CAA. The 
manufacturer will be able to carry back credits to offset a deficit 
that had accrued in a prior model year and was subsequently carried 
over to the current model year, with a limitation on the carry-back of 
credits to three model years. After satisfying any need to offset pre-
existing deficits, a manufacturer may bank remaining credits for use in 
future years, with a limitation on the carry-forward of credits to five 
model years. Averaging vehicle credits with engine credits or between 
vehicle weight classes is not allowed, as discussed in Section I. The 
agencies did not propose and are not adopting any changes to any of 
these provisions for the Phase 2 program.
    While the agencies proposed to retain 5 year carry-forward of 
credits for all HD sectors, the agencies requested comment on the 
merits of a temporary credit carry-forward period of longer than 5 
years for HD pickups and vans, allowing Phase 1 credits generated in 
MYs 2014-2019 to be used through MY 2027. 80 FR 40388. The agencies 
received several comments regarding credit carry-forward. AAPC 
commented that manufacturers should be allowed to carry-forward credits 
indefinitely until they are used to offset a deficit. AAPC commented 
that longer credit life batter aligns with the longer redesign cycles 
and the smaller production volumes for HD vehicles compared to light-
duty vehicles. AAPC also commented that longer credit life would 
motivate earlier introduction of technology and lower compliance costs, 
while not changing the overall effectiveness of the program. Nissan and 
Daimler commented in support of a one-time credit carry-forward that 
would allow Phase 1 credits to be used through MY 2027. The UAW also 
generally supported extended credit carry-forward. The agencies also 
received comments from CARB that the agencies should not allow Phase 1 
credits to be carried forward into Phase 2. CARB commented that Phase 1 
credits should be limited to a three year carry-forward or MY 2020 
whichever is sooner. CARB is concerned that Phase 1 credits may reduce 
the efficacy of the Phase 2 program and delay technology development 
progress.
    As noted above, the agencies are retaining the 5 year credit carry-
forward provisions as proposed for HD pickups and vans. As discussed in 
Section VI.C., the agencies believe that the standards are feasible 
without extending the credit carry-forward provisions. The agencies 
continue to believe that credit carry-forward provides important 
flexibility to manufacturer especially in transitioning to more 
stringent standards and restricting the provision could be disruptive 
to manufacturer product plans. However, the agencies understand CARB's 
concerns regarding Phase 1 credits being used to postpone technology 
progress if some manufacturers were to accumulate large credit banks 
under Phase 1. Large banks of Phase 1 credits combined with unlimited 
credit-forward could have the unintended effect of allowing some 
manufacturers to delay the application of Phase 2 technologies. The 5 
year credit carry-forward preserves needed flexibility for 
transitioning to more stringent Phase 2 standards while also helping to 
address concerns regarding delaying the introduction of technology in 
Phase 2 for HD pickups and vans. As discussed in Section I.C.(1)(b)(i), 
the agencies are extending credit life for certain vocational vehicle 
subcategories during the transition to the Phase 2 standards. We are 
doing this for two reasons. First, some manufacturers in these in 
categories do not have diversified production, which limits the extent 
to which they can use ABT. Second, the Phase 1 program offer little 
opportunity for manufacturers to build up their credit balances. 
Neither of these reasons apply for HD pickups and vans.
    As discussed in Section VI.B.4., EPA and NHTSA are changing the HD 
pickup and van useful life for GHG emissions and fuel consumption from 
the current 11 years/120,000 miles to 15 years/150,000 miles to make 
the useful life for GHG emissions consistent with the useful life of 
criteria pollutants recently updated in the Tier 3 rule. As shown in 
the Equation VI.1 credits calculation formula below, established by the 
Phase 1 rule, useful life in miles is a multiplicative factor included 
in the calculation of CO2 and fuel consumption credits. In 
order to ensure banked credits maintain their value in the transition 
from Phase 1 to Phase 2, NHTSA and EPA proposed and are finalizing an 
adjustment factor of 1.25 (i.e., 150,000 / 120,000) for credits that 
are carried forward from Phase 1 to the MY 2021 and later Phase 2 
standards. Without this adjustment factor, the change in useful life 
would effectively result in a discount of banked credits that are 
carried forward from Phase 1 to Phase 2, which is not the intent of the 
change in the useful life. Consider, for example, a vehicle 
configuration with annual sales of 1,000 vehicles that was 10 g/mile 
below the standard. Under Phase 1, those vehicles would generate 1,200 
Mg of credit (10 x 1,000 x 120,000 / 1,000,000). Under Phase 2, the 
same vehicles would generate 1,500 Mg of credit (10 x 1,000 x 150,000 / 
1,000,000). The agencies do not believe that this adjustment results in 
a loss of program benefits because there is little or no deterioration 
anticipated for CO2 emissions and fuel consumption over the 
life of the vehicles. Also, as described in the standards and 
feasibility sections above, the carry-forward of credits is an integral 
part of the program, helping to smoothing the transition to the new 
Phase 2 standards. The agencies believe that effectively discounting 
carry-forward credits from Phase 1 to Phase 2 is unnecessary and could 
negatively impact the feasibility of the Phase 2 standards.

Equation VI.1 Total Model Year Credit (Debit) Calculation
CO2 Credits (Mg) = [(CO2 Std-CO2 Act) 
x Volume x UL] / 1,000,000
Fuel Consumption Credits (gallons) = (FC Std-FC Act) x Volume x UL x 
100

Where:

CO2 Std = Fleet average CO2 standard (g/mi)
FC Std = Fleet average fuel consumption standard (gal/100 mile)
CO2 Act = Fleet average actual CO2 value (g/
mi)
FC Act = Fleet average actual fuel consumption value (gal/100 mile)
Volume = the total production of vehicles in the regulatory category
UL = the useful life for the regulatory category (miles)

    Manufacturers provided comments in support of applying the 
adjustment factor discussed above. CARB recommended not including the 
adjustment factor. CARB commented that the adjustment would take 
benefits achieved under the Phase 1 program and allow them to be used 
to reduce the potential benefits of Phase 2 standards. The agencies do 
not view the 1.25 adjustment as reducing the benefits of the program 
because the adjustment to the Phase 1 credits is completely offset by 
the increase in the useful life used in the Phase 2 credits calculation 
shown above. In other words, when the Phase 1 credits are used in Phase 
2, 1.25 times more credits will be needed to cover a deficit than would 
be needed under

[[Page 73818]]

Phase 1. The agencies continue to believe this is a reasonable and 
indeed, necessary, way to address the change in useful life as it 
applies to the credits calculations.
(2) Advanced Technology Credits
    The Phase 1 program included on an interim basis advanced 
technology credits for MYs 2014 and later in the form of a multiplier 
of 1.5 for the following technologies:

 Hybrid powertrain designs that include energy storage systems
 Waste heat recovery
 All-electric vehicles
 Fuel cell vehicles

The advanced technology credit program is intended to encourage early 
development of technologies that are not yet commercially available. 
This multiplier approach means that each advanced technology vehicle 
will count as 1.5 vehicles in a manufacturer's compliance 
calculation.\528\ The advanced technology multipliers were included on 
an interim basis in the Phase 1 program and the incentive multipliers 
included for Phase 1and the 1.5 multiplier incentive adopted for Phase 
1 will end beginning in MY 2021, when the more stringent Phase 2 
standards are to begin phase-in. However, the agencies are including 
new incentive multipliers for Phase 2 for PHEVs, EVs, and fuel cell 
vehicles.
---------------------------------------------------------------------------

    \528\ EPA and NHTSA similarly included temporary advanced 
technology multipliers in the light-duty 2017-2025 program, 
believing it was worthwhile to forego modest additional emissions 
reductions and fuel consumption improvements in the near-term in 
order to lay the foundation for the potential for much larger 
``game-changing'' GHG and oil consumption reductions in the longer 
term. The incentives in the light-duty vehicle program are available 
through the 2021 model year. See 77 FR 62811, October 15, 2012.
---------------------------------------------------------------------------

    As discussed in Section I, the agencies requested comment on 
whether or not the incentive multiplier credits should be extended to 
later model years for more advanced technologies such as EVs and fuel 
cell vehicles. These technologies are not projected to be part of the 
technology path used by manufacturers to meet the Phase 2 standards for 
HD pickups and vans. EV and fuel cell technologies will presumably need 
to overcome the highest hurdles to commercialization for HD pickups and 
vans in the time frame of the final rules, and also have the potential 
to provide the highest level of benefit. The agencies received several 
comments encouraging the agencies to continue advanced technology 
multipliers in Phase 2 for heavy-duty vehicles. After considering these 
comments, and considering that EV and fuel technologies have the 
potential for more significant emission reductions and fuel consumption 
savings than any of the technologies projected to be used for Phase 2 
compliance, the agencies are adopting new incentive multipliers for 
Phase 2 for these technologies for all heavy-duty vehicle sectors. A 
detailed discussion of these provisions is provided above in Section I.
    NHTSA and EPA established that for Phase 1, EVs and other zero 
tailpipe emission vehicles be factored into the fleet average GHG and 
fuel consumption calculations based on the diesel standards targets for 
their model year and work factor. The agencies also established for 
electric and zero emission vehicles that in the credits equation the 
actual emissions and fuel consumption performance be set to zero (i.e., 
that emissions be considered on a tailpipe basis exclusively) rather 
than including upstream emissions or energy consumption associated with 
electricity generation. As we look to the future, we are not projecting 
the adoption of electric HD pickups and vans into the heavy duty 
market; therefore, we believe that this provision is still appropriate. 
Unlike the MY 2012-2016 light-duty rule, which adopted a cap whereby 
upstream emissions will be counted after a certain volume of sales (see 
75 FR 25434-25436), we believe there is no need to a cap for HD pickups 
and vans because of the infrequent projected use of EV technologies in 
the Phase 2 timeframe. In Phase 2, we thus continue to deem electric 
vehicles as having zero CO2, CH4, and 
N2O emissions as well as zero fuel consumption. See Section 
I for a discussion of the treatment of lifecycle emissions for 
alternative fuel vehicles, including comments regarding the treatment 
of upstream emissions, and Section XI for the treatment of lifecycle 
emissions for natural gas specifically.
(3) Off-Cycle Technology Credits
    The Phase 1 program established an opportunity for manufacturers to 
generate credits by applying innovative technologies whose 
CO2 and fuel consumption benefits are not captured on the 2-
cycle test procedure (i.e., off-cycle).\529\ For HD pickups and vans, 
the approach for off-cycle technologies established in Phase 1 is 
similar to that established for light-duty vehicles due to the use of 
the same basic chassis test procedures. The agencies are retaining this 
approach for Phase 2 as proposed. See 80 FR 40389. To generate credits, 
manufacturers are required to submit data and a methodology for 
determining the level of credits for the off-cycle technology subject 
to EPA and NHTSA review and approval. The application for off-cycle 
technology credits is also subject to a public evaluation process and 
comment period. EPA and NHTSA would approve the methodology and credits 
only if certain criteria were met. Baseline emissions and fuel 
consumption \530\ and control emissions and fuel consumption need to be 
clearly demonstrated over a wide range of real world driving conditions 
and over a sufficient number of vehicles to address issues of 
uncertainty with the data. Data must be on a vehicle model-specific 
basis unless a manufacturer demonstrated model-specific data were not 
necessary. Once a complete application is submitted by the 
manufacturer, the regulations require that the agencies publish a 
notice of availability in the Federal Register notifying the public of 
a manufacturer's off-cycle credit calculation methodology and provide 
opportunity for comment.
---------------------------------------------------------------------------

    \529\ See 76 FR 57251, September 15, 2011, 40 CFR 
1037.104(d)(13), and 40 CFR 86.1819-14(d)(13). Note that for the 
vocational vehicle and tractor standards, and off-cycle credit is to 
evaluate technologies whose benefit is not recognized by GEM (rather 
than the two-cycle test). See V.D.3 and III.F.3, respectively.
    \530\ Fuel consumption is derived from measured CO2 
emissions using conversion factors of 8,887 g CO2/gallon 
for gasoline and 10,180 g CO2/gallon for diesel fuel.
---------------------------------------------------------------------------

    EPA and NHTSA requested comment on establishing a pre-defined 
technology menu list for HD pickups and vans similar to the approach 
adopted for light-duty vehicles in the MY 2017-2025 rule.\531\ As with 
the light-duty vehicle program, the agencies noted that a pre-defined 
list could simplify the process for generating off-cycle credits and 
may further encourage the introduction of these technologies. However, 
the agencies also noted that appropriate default level of credits for 
the heavier vehicles would need to be established. The agencies 
requested comments with supporting HD pickup and van specific data and 
analysis that would provide a substantive basis for appropriate credits 
levels for the HD pickup and van category. The data and analysis would 
need to demonstrate that the pre-defined credit level represents real-
world emissions reductions and fuel consumption improvements not 
captured by the 2-cycle test procedures.
---------------------------------------------------------------------------

    \531\ 77 FR 62832-62839, October 15, 2012.
---------------------------------------------------------------------------

    The agencies received comments recommending off-cycle credits for 
over a dozen technologies. There are three primary reasons that the 
agencies are not adopting credits for the individual technologies 
recommended by commenters. In many cases, the analysis provided by 
commenters did not

[[Page 73819]]

include sufficient real-world heavy-duty vehicle data on which to base 
the menu credit value recommended by the commenter. Thus, in several 
cases, the analysis provided by commenters was based on light-duty 
vehicle data or on simulations with little detail provided, which 
analysis is not directly applicable to heavy duty pickups and vans for 
purposes of technology performance quantification. Second, in several 
cases, the technologies recommended for off-cycle credits for pickups 
and vans provide significant on-cycle benefit. Such technologies are 
considered to be adequately captured by the test procedures (within the 
meaning of section 86.1819-14(d)(13)) \532\ and are not considered to 
be eligible for off-cycle credits. Examples of adequately captured 
technologies that commenters recommended for off-cycle credits include 
cylinder deactivation and cooled EGR. Moreover, these are technologies 
the agencies expect to be in the mix of technologies used to meet the 
standards (and are projected to be used in the respective analyses of 
compliance paths on which the stringency of the final standards are 
predicated). EPA has already indicated that off-cycle credits are not 
available for technologies that form part of the technology basis for 
the greenhouse gas standards because these technologies' benefits would 
already be reflected in the standard's stringencies (and costs). 77 FR 
62835 (Oct. 12, 2012). Indeed, it is because of these technologies' 
robust performance in two-cycle space that the agencies have projected 
their use as part of the compliance path on which standard stringency 
is predicated. Likewise, many of these technologies are inherent to 
vehicle design and so are similarly ineligible. Id. at 62732, 62836. 
Finally, a few other recommended technologies are considered safety-
related technologies not eligible for credits because they could 
reasonably be expected to fall under vehicle safety standards in the 
future and so would be adopted in any case. Granting off-cycle credits 
for these technologies consequently would amount to an unwarranted 
windfall. Adaptive cruise control and forward collision warning systems 
are examples of these technologies. Chapter 7 of the Response to 
Comments for this final rule provides a detailed response to these 
comments
---------------------------------------------------------------------------

    \532\ This provision states that an off-cycle credit must be for 
a technology that is ``not adequately captured on the Federal Test 
procedure (FTP) and/or the highway Fuel Economy Test (HFET).'' EPA 
has indicated that this requires manufacturers to demonstrate ``an 
incremental off-cycle benefit that is significantly greater than the 
2-cycle benefit.'' 77 FR 62836 (Oct. 12, 2012).
---------------------------------------------------------------------------

(4) Demonstrating Compliance for Heavy-Duty Pickup Trucks and Vans
    The Phase 1 rule established a comprehensive compliance program for 
HD pickups and vans that NHTSA and EPA are generally retaining for 
Phase 2. The compliance provisions cover details regarding the 
implementation of the fleet average standards including vehicle 
certification, demonstrating compliance at the end of the model year, 
in-use standards and testing, carryover of certification test data, and 
reporting requirements. Please see Section V.B.(1) of the Phase 1 rule 
Preamble (76 FR 57256-57263) for a detailed discussion of these 
provisions.
    The Phase 1 rule contains special provisions regarding loose 
engines and optional chassis certification of certain vocational 
vehicles over 14,000 lbs. GVWR. As proposed, the agencies are extending 
the optional chassis certification provisions to Phase 2 and are 
providing a temporary loose engine provision for Phase 2 as described 
in Section V.D.3.e, under Compliance Flexibility Provisions. See the 
vocational vehicle Section V.D. and XIII.A.2 for a detailed discussion 
of the rule for optional chassis certification and Section II.D. for 
the discussion of loose engines.

VII. Aggregate GHG, Fuel Consumption, and Climate Impacts

    Given that the purpose of setting these Phase 2 standards is to 
reduce fuel consumption and greenhouse gas (GHG) emissions from heavy-
duty vehicles, it is necessary for the agencies to analyze the extent 
to which these standards will accomplish that purpose. This section 
describes the agencies' methodologies for projecting the reductions in 
greenhouse gas (GHG) emissions and fuel consumption and the 
methodologies the agencies used to quantify the impacts associated with 
these standards. In addition, EPA's analyses of the projected change in 
atmospheric carbon dioxide (CO2) concentration and 
consequent climate change impacts are discussed. Because of NHTSA's 
obligations under EPCA/EISA and NEPA, NHTSA further analyzes the 
projected environmental impacts related to fuel consumption, GHG 
emissions, and climate change, for each regulatory alternative. 
Detailed documentation of this analysis is provided in Chapters 3, 4 
and 5 of NHTSA's FEIS accompanying today's notice.

A. What methodologies did the Agencies use to project GHG emissions and 
fuel consumption impacts?

    Different tools exist for estimating potential fuel consumption and 
GHG emissions impacts associated with fuel efficiency and GHG emission 
standards. One such tool is EPA's official mobile source emissions 
inventory model named Motor Vehicle Emissions Simulator (MOVES).\533\ 
The agencies used a revised version of MOVES2014a to quantify the 
impacts of these standards for vocational vehicles and combination 
tractor-trailers on GHG emissions and fuel consumption.
---------------------------------------------------------------------------

    \533\ MOVES homepage: https://www3.epa.gov/otaq/models/moves/index.htm (last accessed May 27, 2016).
---------------------------------------------------------------------------

    Since the notice of proposed rulemaking, EPA has made certain 
updates to MOVES in response to the public comments on the proposal: 
(1) The projections of vehicle sales, populations, and activity in the 
version used for the final rulemaking were updated to incorporate the 
latest projections from the U.S. Department of Energy's Annual Energy 
Outlook 2015 report; \534\ (2) the extended idle and APU emission rates 
in MOVES were updated based on the analyses of latest test programs 
that reflect the current prevalence of clean idle certified engines; 
and (3) the baseline adoption rates of idle reduction technology were 
reassessed and projected to be lower than what was assumed in the 
proposal, as described in Section III.D.1.a of the Preamble. In 
addition, changes to APU emissions rates for PM2.5 were 
implemented in MOVES reflecting the fact that EPA is adopting 
requirements to control PM2.5 emissions from APUs installed 
in new tractors, as discussed in Section III.C.3 of the Preamble. 
Finally, methodological improvements were made in classifying vehicle 
types and in forecasting vehicle populations and activity. The 
aforementioned updates above, along with other changes, are documented 
in the memorandum to the docket.\535\
---------------------------------------------------------------------------

    \534\ Annual Energy Outlook 2015. http://www.eia.gov/forecasts/archive/aeo15/ (last accessed May 27, 2016).
    \535\ U.S. EPA. Updates to MOVES for Emissions Analysis of 
Greenhouse Gas Emissions and Fuel Efficiency Standards for Medium- 
and Heavy-Duty Engines and Vehicles--Phase 2 FRM. Docket No. EPA-HQ-
OAR-2016. July 2016.
---------------------------------------------------------------------------

    MOVES was run with user input databases, described in more detail 
below, that reflected the projected technological improvements 
resulting from the final rules, such as the improvements in engine and 
vehicle efficiency, aerodynamic drag, and tire rolling resistance. The 
changes made to

[[Page 73820]]

the default MOVES database are described below in Section VII.B.(3). 
All the input data, MOVES run spec files, and the scripts used for the 
analysis, as well as the version of MOVES used to generate the 
emissions inventories, can be found in the docket.\536\
---------------------------------------------------------------------------

    \536\ Memorandum to the Docket ``Runspecs, Model Inputs, MOVES 
Code and Database for HD GHG Phase 2 FRM Emissions Modeling'' Docket 
No. EPA-HQ-OAR-2016. July 2016.
---------------------------------------------------------------------------

    Another such tool is DOT's CAFE model, which estimates how 
manufacturers could potentially apply technology improvements in 
response to new standards, and then calculates, among other things, 
resultant changes in national fuel consumption and GHG emissions. As 
described in Section VI, two versions of this model were used for 
analysis of potential new standards for HD pickups and vans. Both 
versions use the work-based attribute metric of ``work factor'' 
established in the Phase 1 rule for heavy-duty pickups and vans instead 
of the light-duty ``footprint'' attribute metric. The CAFE model takes 
user-specified inputs on, among other things, vehicles that are 
projected to be produced in a given model year, technologies available 
to improve fuel efficiency on those vehicles, potential regulatory 
standards that will drive improvements in fuel efficiency, and economic 
assumptions. The CAFE model takes every vehicle in each manufacturer's 
fleet and decides what technologies to add to those vehicles in order 
to allow each manufacturer to comply with the standards in the most 
cost-effective way. Based on those results, the CAFE model then 
calculates total fuel consumption and GHG emissions impacts based on 
those inputs, along with economic costs and benefits. The DOT's CAFE 
model is further described in detail in Section VI of the Preamble and 
Chapter 10 of the RIA.
    For these rules, the agencies used two analytical methods for the 
heavy-duty pickup and van segment employing both DOT's CAFE model and 
EPA's MOVES model. The agencies used EPA's MOVES model to estimate fuel 
consumption and emissions impacts for tractor-trailers (including the 
engine that powers the tractor) and vocational vehicles (including the 
engine that powers the vehicle).
    For heavy-duty pickups and vans, the agencies performed separate 
analyses, which we refer to as ``Method A'' and ``Method B.'' In Method 
A, a modified version of the CAFE model was used to project a pathway 
the industry could use to comply with each regulatory alternative and 
the estimated effects on fuel consumption, emissions, benefits and 
costs. In Method B, the MOVES model was used to estimate fuel 
consumption and emissions from these vehicles. NHTSA considered Method 
A as its central analysis. EPA considered the results of Method B as 
its central analysis. The agencies concluded that these methods led the 
agencies to the same conclusions and the same selection of the final 
standards. See Chapter 5 of the RIA for additional discussions of these 
two methods.
    For both methods, the agencies analyzed the impact of the final 
rules, relative to two different reference cases--``flat'' (Alternative 
1a) and ``dynamic'' (Alternative 1b). The flat baseline projects very 
little improvement in new vehicles in the absence of new Phase 2 
standards. In contrast, the dynamic baseline projects more improvements 
in vehicle fuel efficiency in the absence of new Phase 2 standards. The 
agencies considered both reference cases (for additional details, see 
Chapter 11 of the RIA). The results for all of the regulatory 
alternatives relative to both reference cases, derived via the same 
methodologies discussed in this section, are presented in Section X of 
the Preamble.
    For brevity, a subset of these analyses are presented in this 
section, and the reader is referred to both Chapter 11 of the RIA and 
NHTSA's FEIS Chapters 3, 4 and 5 for complete sets of these analyses. 
In this section, Method A is presented for the final standards (i.e., 
Alternative 3--the agencies' preferred alternative), relative to both 
the dynamic baseline (Alternative 1b) and the flat baseline 
(Alternative 1a). Method B is presented for the final standards, 
relative only to the flat baseline.
    Because reducing fuel consumption also affects emissions that occur 
as a result of fuel production and distribution (including renewable 
fuels), the agencies also calculated those ``upstream'' changes using 
the ``downstream'' fuel consumption reductions predicted by the CAFE 
model (in ``Method A'') and the MOVES model (in ``Method B''). As 
described in Section VI, Method A uses the CAFE model to estimate 
vehicular fuel consumption and emissions impacts only for HD pickups 
and vans and to calculate upstream impacts. For vocational vehicles and 
combination tractor-trailers, both Method A and Method B use the same 
upstream tools originally created for the Renewable Fuel Standard 2 
(RFS2) rulemaking analysis,\537\ used in the LD GHG rulemakings,\538\ 
HD GHG Phase 1,\539\ and updated for the current analysis. The estimate 
of emissions associated with production and distribution of gasoline 
and diesel from crude oil is based on emission factors in the 
``Greenhouse Gases, Regulated Emissions, and Energy Use in 
Transportation'' model (GREET) developed by DOE's Argonne National Lab. 
In some cases, the GREET values were modified or updated by the 
agencies to be consistent with the National Emission Inventory (NEI) 
and emission factors from MOVES. Method B uses the same tool described 
above to estimate the upstream impacts for HD pickups and vans. For 
additional details, see Chapter 5 of the RIA. The upstream tool used 
for the Method B can be found in the docket.\540\ As noted in Section 
VI above, these analyses corroborate each other's results.
---------------------------------------------------------------------------

    \537\ U.S. EPA. Draft Regulatory Impact Analysis: Changes to 
Renewable Fuel Standard Program. Chapters 2 and 3. May 26, 2009. 
Docket ID: EPA-HQ-OAR-2009-0472-0119.
    \538\ 2017 and Later Model Year Light-Duty Vehicle Greenhouse 
Gas Emissions and Corporate Average Fuel Economy Standards (77 FR 
62623, October 15, 2012).
    \539\ Greenhouse Gas Emission Standards and Fuel Efficiency 
Standards for Medium- and Heavy-Duty Engines and Vehicles (76 FR 
57106, September 15, 2011).
    \540\ Memorandum to the Docket ``Upstream Emissions Modeling 
Files for HDGHG Phase 2 FRM'' Docket No. EPA-HQ-OAR-2016. July 2016.
---------------------------------------------------------------------------

    The agencies analyzed the anticipated emissions impacts of the 
final rules on carbon dioxide (CO2), methane 
(CH4), nitrous oxide (N2O), and 
hydrofluorocarbons (HFCs) for a number of calendar years (for purposes 
of the discussion in these final rules, only 2025, 2040 and 2050 will 
be shown) by comparing to both reference cases.\541\ Additional runs 
were performed for just three of the greenhouse gases (CO2, 
CH4, and N2O) and for fuel consumption for every 
calendar year from 2016 to 2050, inclusive, which fed the economy-wide 
modeling, monetized greenhouse gas benefits estimation, and climate 
impacts analyses, discussed in sections below.\542\
---------------------------------------------------------------------------

    \541\ The emissions impacts of the final rules on non-GHGs, 
including air toxics, were also estimated using MOVES. See Section 
VIII of the Preamble for more information.
    \542\ The CAFE model estimates, among other things, 
manufacturers' potential multiyear planning decisions within the 
context of an estimated year-by-year product cadence (i.e., schedule 
for redesigning and freshening vehicles). The model was allowed to 
deploy technology in earlier model years in the analysis in order to 
account for the potential that manufacturers might take anticipatory 
actions in model years preceding those covered by today's rules.

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

[[Page 73821]]

B. Analysis of Fuel Consumption and GHG Emissions Impacts Resulting 
From Final Standards

    The following sections describe the model inputs and assumptions 
for both the flat and dynamic reference cases and the control case 
representing the agencies' final fuel efficiency and GHG standards. The 
details of all the MOVES runs and input data tables, as well as the 
MOVES code and database, can be found in the docket.\543\ See Section 
VI.C for the discussion of the model inputs and assumptions for the 
analysis of the HD pickups and vans using DOT's CAFE Model.
---------------------------------------------------------------------------

    \543\ Memorandum to the Docket ``Runspecs, Model Inputs, MOVES 
Code and Database for HD GHG Phase 2 FRM Emissions Modeling'' Docket 
No. EPA-HQ-OAR-2016. July 2016.
---------------------------------------------------------------------------

(1) Model Inputs and Assumptions for the Flat Reference Case
    The flat reference case (identified as Alternative 1a in Section 
X), includes the impact of Phase 1, but assumes that fuel efficiency 
and GHG emission standards are not improved beyond the required 2018 
model year levels. Alternative 1a functions as one of the baselines 
against which the impacts of the final standards can be evaluated. The 
MOVES2014a default road load parameters and energy rates were used for 
the vocational vehicles and HD pickups and vans for this alternative 
because we assumed no market-driven improvements in fuel efficiency. 
The tractor-trailer road load parameters were changed from the 
MOVES2014a default values to account for projected improvements in the 
efficiency of the box trailers pulled by combination tractors due to 
increased penetration of aerodynamic technologies and low rolling 
resistance tires attributed to both EPA's SmartWay Transport 
Partnership and California Air Resources Board's Tractor-Trailer 
Greenhouse Gas regulation, as described in Section IV of the Preamble. 
We maintained the same road load inputs for tractor-trailers for 2018 
and beyond. The flat reference case assumed the growth in vehicle 
populations and miles traveled based on the relative annual VMT growth 
from AEO2015 Final Release for model years 2014 and later.\544\
---------------------------------------------------------------------------

    \544\ Annual Energy Outlook 2015. http://www.eia.gov/forecasts/archive/aeo15/ (last accessed May 27, 2016).
---------------------------------------------------------------------------

(2) Model Inputs and Assumptions for the Dynamic Reference Case
    The dynamic reference case (identified as Alternative 1b in Section 
X) also includes the impact of Phase 1 and generally assumes that fuel 
efficiency and GHG emission standards are not improved beyond the 
required 2018 model year levels. However, for this case, the agencies 
assume market forces will lead to additional fuel efficiency 
improvements for HD pickups and vans and tractor-trailers. These 
additional assumed improvements are described in Section X of the 
Preamble. No additional fuel efficiency improvements due to market 
forces were assumed for vocational vehicles. For HD pickups and vans, 
the agencies applied the CAFE model using the input assumption that 
manufacturers having achieved compliance with Phase 1 standards will 
continue to apply technologies for which increased purchase costs will 
be ``paid back'' through corresponding fuel savings within the first 
six months of vehicle operation. The agencies conducted the MOVES 
analysis of this case in the same manner as for the flat reference 
case.
(3) Model Inputs and Assumptions for ``Control'' Case
(a) Vocational Vehicles and Tractor-Trailers
    The ``control'' case represents the agencies' final fuel efficiency 
and GHG standards. The agencies developed additional user input data 
for MOVES runs to estimate the control case inventories. The inputs to 
MOVES for the control case account for improvements of engine and 
vehicle efficiency in vocational vehicles and combination tractor-
trailers. The agencies used the percent reduction in aerodynamic drag 
and tire rolling resistance coefficients and absolute changes in 
average total running weight (gross combined weight) expected from the 
final rules to develop the road load inputs for the control case, based 
on the GEM analysis. The agencies developed energy inputs for the 
control case runs using the percent reduction in CO2 
emissions expected from the powertrain and other vehicle technologies 
not accounted for in the aerodynamic drag and tire rolling resistance 
in the final rules.
    Table VII-1 and Table VII-2 describe the improvements in engine and 
vehicle efficiency from the final rules for each affected model year 
for vocational vehicles and combination tractor-trailers that were 
input into MOVES for estimating the control case emissions inventories. 
Additional details regarding the MOVES inputs are included in Chapter 5 
of the RIA.
---------------------------------------------------------------------------

    \545\ Vocational vehicles modeled in MOVES include heavy heavy-
duty, medium heavy-duty, and light heavy-duty vehicles. However, for 
light heavy-duty vocational vehicles, class 2b and 3 vehicles are 
not included in the inventories for the vocational sector. Instead, 
all vocational vehicles with GVWR of less than 14,000 lbs. were 
modeled using the energy rate reductions described below for HD 
pickup trucks and vans. In practice, many manufacturers of these 
vehicles choose to average the lightest vocational vehicles into 
chassis-certified families (i.e., heavy-duty pickups and vans).

                    Table VII-1--Estimated Reductions in Energy Rates for the Final Standards
----------------------------------------------------------------------------------------------------------------
                                                                                                  Reduction from
                 Vehicle type                                 Fuel                  Model years    flat baseline
                                                                                                        (%)
----------------------------------------------------------------------------------------------------------------
Long-haul Tractor-Trailers and HHD Vocational.  Diesel..........................       2018-2020             1.0
                                                                                       2021-2023             7.9
                                                                                       2024-2026            12.4
                                                                                           2027+            16.3
Short-haul Tractor-Trailers and HHD Vocational  Diesel..........................       2018-2020             0.6
                                                                                       2021-2023             7.4
                                                                                       2024-2026            11.9
                                                                                           2027+            15.0
Single-Frame Vocational \545\.................  Diesel..........................       2021-2023             7.8
                                                                                       2024-2026            12.3
                                                                                           2027+            16.0

[[Page 73822]]

 
                                                Gasoline........................       2021-2023             6.9
                                                                                       2024-2026             9.8
                                                                                           2027+            13.3
Urban Bus.....................................  Diesel and CNG..................       2021-2023             7.0
                                                                                       2024-2026            11.8
                                                                                           2027+            14.4
----------------------------------------------------------------------------------------------------------------


                 Table VII-2--Estimated Reductions in Road Load Factors for the Final Standards
----------------------------------------------------------------------------------------------------------------
                                                                   Reduction in    Reduction in
                                                                   tire rolling     aerodynamic       Weight
             Vehicle type                      Model years          resistance         drag          reduction
                                                                    coefficient     coefficient      (lb) \a\
                                                                        (%)             (%)
----------------------------------------------------------------------------------------------------------------
Combination Long-haul Tractor-Trailers  2018-2020...............             6.1             5.6            -140
                                        2021-2023...............            13.3            12.5            -199
                                        2024-2026...............            16.3            19.3            -294
                                        2027+...................            18.0            28.2            -360
Combination Short-haul Tractor-         2018-2020...............             5.2             0.9             -23
 Trailers.\546\                         2021-2023...............            11.9             4.0             -43
                                        2024-2026...............            14.1             6.2             -43
                                        2027+...................            15.9             8.8             -43
Intercity Buses.......................  2021-2023...............            18.2               0               0
                                        2024-2026...............            20.8               0               0
                                        2027+...................            24.7               0               0
Transit Buses.........................  2021-2023...............               0               0               0
                                        2024-2026...............               0               0               0
                                        2027+...................            12.1               0               0
School Buses..........................  2021-2023...............            10.1               0               0
                                        2024-2026...............            14.9               0               0
                                        2027+...................            19.7               0               0
Refuse Trucks.........................  2021-2023...............               0               0               0
                                        2024-2026...............               0               0               0
                                        2027+...................            12.1               0               0
Single Unit Short-haul Trucks.........  2021-2023...............             6.4               0             4.4
                                        2024-2026...............             6.4               0            10.4
                                        2027+...................            10.2               0            16.5
Single Unit Long-haul Trucks..........  2021-2023...............             8.4               0             7.9
                                        2024-2026...............            13.3               0            23.6
                                        2027+...................            13.3               0            39.4
Motor Homes...........................  2021-2023...............            20.8               0               0
                                        2024-2026...............            20.8               0               0
                                        2027+...................            24.7               0               0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ Negative weight reductions reflect an expected weight increase as a byproduct of other vehicle and engine
  improvements as described in Chapter 5 of the RIA.

    In addition, the CO2 standard for tractors, reflecting 
the use of idle reduction technologies such as diesel-powered auxiliary 
power units (APUs) and battery-powered APUs, as discussed in Section 
III.D of the Preamble, was included in the modeling for the long-haul 
combination tractor-trailers, as shown below in Table VII-3.
---------------------------------------------------------------------------

    \546\ Vocational tractors are included in the short-haul tractor 
segment.

        Table VII-3--Assumed APU Use During Extended Idling for Combination Long-Haul Tractor-Trailers a
----------------------------------------------------------------------------------------------------------------
                                                                                    Diesel APU      Battery APU
                          Vehicle type                              Model year      Penetration     Penetration
                                                                                        (%)             (%)
----------------------------------------------------------------------------------------------------------------
Combination Long-Haul Trucks....................................       2010-2020               9               0
                                                                       2021-2023              30              10
                                                                       2024-2026              40              10
                                                                           2027+              40              15
----------------------------------------------------------------------------------------------------------------
Note:

[[Page 73823]]

 
\a\ Other idle reduction technologies (such as automatic engine shutdown, fuel operated heaters, and stop-start
  systems) were modeled as part of the energy rates.

    To account for the potential increase in vehicle use expected to 
result from improvements in fuel efficiency for vocational vehicles and 
combination tractor-trailers due to the final rules (also known as the 
``rebound effect'' and described in more detail in Section IX.E of the 
Preamble), the control case assumed an increase in VMT from the 
reference levels by 0.30 percent for the vocational vehicles and 0.75 
percent for the combination tractor-trailers.\547\
---------------------------------------------------------------------------

    \547\ Memorandum to the Docket ``VMT Rebound Inputs to MOVES for 
HDGHG2 Phase 2 FRM'' Docket No. EPA-HQ-OAR-2016. July 2016.
---------------------------------------------------------------------------

(b) Heavy-Duty Pickups and Vans
    As explained above and as also discussed in the RIA, the agencies 
used both DOT's CAFE model and EPA's MOVES model, for Method A and B, 
respectively, to project fuel consumption and GHG emissions impacts 
resulting from these standards for HD pickups and vans, including 
downstream vehicular emissions as well as emissions from upstream 
processes related to fuel production, distribution, and delivery.
(i) Method A for HD Pickups and Vans
    For Method A, the agencies used the CAFE model which applies fuel 
properties (density and carbon content) to estimated fuel consumption 
in order to calculate vehicular CO2 emissions, applies per-
mile emission factors from MOVES to estimated VMT (for each regulatory 
alternative, adjusted to account for the rebound effect) in order to 
calculate vehicular CH4 and N2O emissions (as 
well, as discussed below, of non-GHG pollutants), and applies per-
gallon upstream emission factors from GREET in order to calculate 
upstream GHG (and non-GHG) emissions.
    As discussed above in Section VI, the standards for HD pickups and 
vans increase in stringency by 2.5 percent annually during model years 
2021-2027. The standards define targets specific to each vehicle model, 
but no individual vehicle is required to meet its target; instead, the 
production-weighted averages of the vehicle-specific targets define 
average fuel consumption and CO2 emission rates that a given 
manufacturer's overall fleet of produced vehicles is required to 
achieve as a whole. The standards are specified separately for gasoline 
and diesel vehicles, and vary with work factor. Both the NPRM and 
today's analysis assume that some application of mass reduction could 
enable increased work factor in cases where manufacturers increase a 
vehicle's rated payload and/or towing capacity without a change to GVWR 
and GCWR, but there are other ways manufacturers may change work factor 
which the analysis does not capture. Average required levels will 
depend on the future mix of vehicles and the work factors of the 
vehicles produced for sale in the U.S. Since these can only be 
estimated at this time, average required and achieved fuel consumption 
and CO2 emission rates are subject to uncertainty. Between 
the NPRM and the issuance of today's final rules, the agencies updated 
the market forecast (and other inputs) used to analyze HD pickup and 
van standards, and doing so leads to different estimates of required 
and achieved fuel consumption and CO2 emission rates (as 
well as different estimates of impacts, costs, and benefits).
    The following four tables present stringency increases and 
estimated required and achieved fuel consumption and CO2 
emission rates for the two No Action Alternatives (Alternative 1a and 
1b) and the standards defining the final program. Stringency increases 
are shown relative to standards applicable in model year 2018 (and 
through model year 2020). As mathematical functions, the standards 
themselves are not subject to uncertainty. By 2027, they are 16.2 
percent more stringent (i.e., lower) than those applicable during 2018-
2020. NHTSA estimates that, by model 2027, these standards could reduce 
average required fuel consumption and CO2 emission rates to 
about 4.88 gallons/100 miles and about 4 grams/mile, respectively. 
NHTSA further estimates that average achieved fuel consumption and 
CO2 emission rates could correspondingly be reduced to about 
the same levels. If, as represented by Alternative 1b, manufacturers 
will, even absent today's standards, voluntarily make improvements that 
pay back within six months, these model year 2027 levels are about 12 
percent lower than the agencies estimate could be achieved under the 
Phase 1 standards defining the No Action Alternative. If, as 
represented by Alternative 1a, manufacturers will, absent today's 
standards, only apply technology as required to achieve compliance, 
these model year 2027 levels are about 13 percent lower than the 
agencies estimate could be achieved under the Phase 1 standards. As 
indicated below, the agencies estimate that these improvements in fuel 
consumption and CO2 emission rates will build from model 
year to model year, beginning as soon as model year 2017 (insofar as 
manufacturers may make anticipatory improvements if warranted given 
planned product cadence).
    The NPRM analysis suggested that both the achieved and required 
fuel consumption and CO2 reductions would be larger than the 
current analysis suggests. The NPRM suggested that achieved reductions 
would be 13.5 and 15 percent, for the dynamic and flat baselines, 
respectively. The erosion of the standards and fuel consumption 
reductions can be attributed to the increased work factor of the 2015 
fleet relative to the 2014 fleet. Section 6 discusses in more detail 
the changes in the distribution of work factor for key market players 
from the MY 2014 to the MY 2015 fleet.

[[Page 73824]]



    Table VII-4--Stringency of HD Pickup and Van Standards, Estimated Average Required and Achieved Fuel Consumption Rates for Method A, Relative to
                                                                   Alternative 1b \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              Ave. required fuel cons. (gal./100     Ave. achieved fuel cons. (gal./100
                                                                                             mi.)                                   mi.)
               Model year                      Stringency  (vs. 2018)      -----------------------------------------------------------------------------
                                                                                                       Reduction                              Reduction
                                                                             No action      Final         (%)       No action      Final         (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016....................................  MYs 2016-2020 Subject to Phase 1         6.32         6.32          0.0         6.14         6.14          0.0
2017....................................   Standards.                              6.16         6.16          0.0         6.02         5.89          2.2
2018....................................                                           5.83         5.83          0.0         5.97         5.78          3.2
2019....................................                                           5.81         5.81          0.0         5.77         5.47          5.3
2020....................................                                           5.80         5.80          0.0         5.75         5.46          5.1
2021....................................  2.5.............................         5.79         5.65          2.4         5.68         5.28          7.2
2022....................................  4.9.............................         5.80         5.52          4.8         5.64         5.22          7.5
2023....................................  7.3.............................         5.80         5.38          7.2         5.64         5.21          7.6
2024....................................  9.6.............................         5.80         5.25          9.5         5.65         5.22          7.6
2025....................................  11.9............................         5.81         5.12         11.8         5.65         5.14          9.1
2026....................................  14.1............................         5.81         5.01         13.7         5.65         5.02         11.1
2027....................................  16.2............................         5.80         4.88         15.8         5.57         4.92         11.7
2028 *..................................  16.2............................         5.81         4.91         15.5         5.57         4.89         12.2
2029 *..................................  16.2............................         5.81         4.91         15.6         5.57         4.88         12.4
2030 *..................................  16.2............................         5.81         4.91         15.6         5.57         4.88         12.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
a For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
* Absent further action, standards assumed to continue unchanged after model year 2027.


   Table VII-5--Stringency of HD Pickup and Van Standards, Estimated Average Required and Achieved CO[ihel2] Emission Rates for Method A, Relative to
                                                                    Alternative 1b a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Ave. required CO[ihel2] Rate (g./mi.)           Ave. achieved CO[ihel2] Rate (g./mi.)
           Model year              Stringency (vs. 2018) -----------------------------------------------------------------------------------------------
                                            (%)              No Action         Final       Reduction (%)     No Action         Final       Reduction (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016............................  MYs 2016-2020 Subject              597             597             0.0             578             578             0.0
2017............................   to Phase 1 Standards.             582             582             0.0             567             554             2.2
2018............................                                     550             550             0.0             562             544             3.2
2019............................                                     548             548             0.0             543             514             5.3
2020............................                                     547             547             0.0             541             513             5.1
2021............................  2.5...................             545             532             2.4             534             496             7.1
2022............................  4.9...................             546             519             4.9             530             491             7.4
2023............................  7.3...................             545             506             7.2             529             490             7.5
2024............................  9.6...................             547             494             9.5             531             491             7.5
2025............................  11.9..................             547             483            11.7             530             483             9.0
2026............................  14.1..................             547             472            13.7             530             472            11.0
2027............................  16.2..................             546             460            15.8             523             462            11.5
2028*...........................  16.2..................             547             462            15.5             523             460            12.0
2029*...........................  16.2..................             547             462            15.5             524             460            12.2
2030*...........................  16.2..................             547             462            15.5             524             460            12.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
a For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
* Absent further action, standards assumed to continue unchanged after model year 2027.


    Table VII-6--Stringency of HD Pickup and Van Standards, Estimated Average Required and Achieved Fuel Consumption Rates for Method A, Relative to
                                                                     Alternative 1aa
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Ave. required fuel cons. (gal./100 mi.)         Ave. achieved fuel cons. (gal./100 mi.)
           Model year              Stringency (vs. 2018) -----------------------------------------------------------------------------------------------
                                            (%)              No Action         Final       Reduction (%)     No Action         Final       Reduction (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016............................  MYs 2016-2020 Subject             6.32            6.32             0.0            6.14            6.14             0.0
2017............................   to Phase 1 Standards.            6.16            6.16             0.0            6.00            5.85             2.4
2018............................                                    5.83            5.83             0.0            5.94            5.75             3.2
2019............................                                    5.81            5.81             0.0            5.74            5.43             5.4
2020............................                                    5.80            5.80             0.0            5.73            5.43             5.2
2021............................  2.5...................            5.79            5.65             2.4            5.70            5.27             7.5
2022............................  4.9...................            5.80            5.52             4.8            5.69            5.23             8.2
2023............................  7.3...................            5.80            5.38             7.2            5.69            5.22             8.3
2024............................  9.6...................            5.80            5.25             9.5            5.70            5.22             8.3

[[Page 73825]]

 
2025............................  11.9..................            5.81            5.13            11.8            5.70            5.13            10.0
2026............................  14.1..................            5.81            5.02            13.6            5.70            5.03            11.9
2027............................  16.2..................            5.80            4.89            15.8            5.64            4.92            12.8
2028*...........................  16.2..................            5.81            4.91            15.4            5.64            4.89            13.3
2029*...........................  16.2..................            5.81            4.91            15.5            5.64            4.89            13.4
2030*...........................  16.2..................            5.81            4.91            15.5            5.64            4.89            13.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
a For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
* Absent further action, standards assumed to continue unchanged after model year 2027.
** Increased work factor for some vehicles produces a slight increase in average required fuel consumption.


   Table VII-7--Stringency of HD Pickup and Van Standards, Estimated Average Required and Achieved CO[ihel2] Emission Rates for Method A, Relative to
                                                                    Alternative 1a a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Ave. required CO[ihel2] Rate (g./mi.)           Ave. achieved CO[ihel2] Rate (g./mi.)
           Model year              Stringency (vs. 2018) -----------------------------------------------------------------------------------------------
                                            (%)              No Action         Final       Reduction (%)     No Action         Final       Reduction (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016............................  MYs 2016-2020 Subject              597             597             0.0             578             578             0.0
2017............................   to Phase 1 Standards.             582             582             0.0             564             551             2.3
2018............................                                     550             550             0.0             559             541             3.2
2019............................                                     548             548             0.0             540             511             5.4
2020............................                                     547             547             0.0             538             510             5.2
2021............................  2.5...................             545             532             2.4             535             495             7.4
2022............................  4.9...................             546             519             4.8             534             491             8.0
2023............................  7.3...................             545             506             7.2             533             490             8.2
2024............................  9.6...................             547             494             9.5             535             491             8.2
2025............................  11.9..................             547             483            11.7             535             483             9.8
2026............................  14.1..................             547             472            13.6             535             473            11.7
F 2027..........................  16.2..................             546             460            15.8             529             462            12.6
2028*...........................  16.2..................             547             462            15.5             530             460            13.1
2029*...........................  16.2..................             547             462            15.5             530             460            13.2
2030*...........................  16.2..................             547             462            15.5             530             460            13.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
a For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
* Absent further action, standards assumed to continue unchanged after model year 2027.
** Increased work factor for some vehicles produces a slight increase in the average required CO[ihel2] emission rate.

    While the above tables show the agencies' estimates of average fuel 
consumption and CO2 emission rates manufacturers of pickups 
and vans might achieve under today's standards, total U.S. fuel 
consumption and GHG emissions from HD pickups and vans will also depend 
on how many of these vehicles are produced, and how they are operated 
over their useful lives. Relevant to estimating these outcomes, the 
CAFE model applies vintage-specific estimates of vehicle survival and 
mileage accumulation, and adjusts the latter to account for the rebound 
effect. This impact of the rebound effect is specific to each model 
year (and, underlying, to each vehicle model in each model year), 
varying with changes in achieved fuel consumption rates.
(ii) Method B for HD Pickups and Vans
    For Method B, the MOVES model was used to estimate fuel consumption 
and GHG emissions for HD pickups and vans. MOVES evaluated these 
standards for HD pickup trucks and vans in terms of grams of 
CO2 per mile or gallons of fuel per 100 miles. Since nearly 
all HD pickup trucks and vans are certified on a chassis dynamometer, 
the CO2 reductions for these vehicles were not represented 
as engine and road load reduction components, but rather as total 
vehicle CO2 reductions. The control case for HD pickups and 
vans assumed an increase in VMT from the reference levels of 1.08 
percent.\548\
---------------------------------------------------------------------------

    \548\ Memorandum to the Docket ``VMT Rebound Inputs to MOVES for 
HDGHG2 Phase 2 FRM'' Docket No. EPA-HQ-OAR-2016. July 2016.

[[Page 73826]]



  Table VII-8--Estimated Total Vehicle CO[ihel2] Reductions for the Final Standards and In-Use Emissions for HD
                                       Pickup Trucks and Vans in Method Ba
----------------------------------------------------------------------------------------------------------------
                                                                                                     CO[ihel2]
                                                                                                  reduction from
                 Vehicle type                                 Fuel                  Model year    flat  baseline
                                                                                                        (%)
----------------------------------------------------------------------------------------------------------------
HD pickup trucks and vans.....................  Gasoline and Diesel.............            2021            2.50
                                                                                            2022            4.94
                                                                                            2023            7.31
                                                                                            2024            9.63
                                                                                            2025           11.89
                                                                                            2026           14.09
                                                                                           2027+           16.24
----------------------------------------------------------------------------------------------------------------
Note:
a For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

C. What are the projected reductions in fuel consumption and GHG 
emissions?

    NHTSA and EPA expect significant reductions in GHG emissions and 
fuel consumption from the final rules--fuel consumption reductions from 
more efficient vehicles, emission reductions from both downstream 
(tailpipe) and upstream (fuel production and distribution) sources, and 
reduction in HFC emissions from the air conditioning leakage standards 
(see Section V.B.(2)(c)). The following subsections summarize two 
different analyses of the annual GHG emissions and fuel consumption 
reductions expected from these final rules, as well as the reductions 
in GHG emissions and fuel consumption expected over the lifetime of 
each heavy-duty vehicle category. Section VII.C.(1) shows the impacts 
of the final rules on fuel consumption and GHG emissions, using the 
MOVES model for tractor-trailers and vocational vehicles and the DOT's 
CAFE model for HD pickups and vans (Method A), relative to two 
different reference cases--flat and dynamic. Section VII.C.2 shows the 
impacts of the final standards, relative to the flat reference case 
only, using the MOVES model for all heavy-duty vehicle categories. 
NHTSA also analyzes these impacts resulting from the final rules and 
reasonable alternatives in Chapters 3, 4 and 5 of its FEIS.
(1) Impacts of the Final Rules Using Analysis Method A
(a) Calendar Year Analysis
(i) Downstream (Tailpipe) Emissions Projections
    As described in Section VII.A, for the analysis using Method A, the 
agencies used MOVES to estimate downstream GHG inventories from the 
final rules for vocational vehicles and tractor-trailers. For HD 
pickups and vans, DOT's CAFE model was used.
    The following two tables summarize the agencies' estimates of HD 
pickup and van fuel consumption and GHG emissions under the current 
standards defining the No-Action and final program, respectively, using 
Method A. Table VII-9 shows results assuming manufacturers will 
voluntarily make improvements that pay back within six months (i.e., 
Alternative 1b). Table VII-10 shows results assuming manufacturers will 
only make improvements as needed to achieve compliance with standards 
(i.e., Alternative 1a). While underlying calculations are all performed 
for each calendar year during each vehicle's useful life, presentation 
of outcomes on a model year basis aligns more clearly with 
consideration of cost impacts in each model year, and with 
consideration of standards specified on a model year basis. In 
addition, Method A analyzes manufacturers' potential responses to HD 
pickup and van standards on a model year basis through 2030, and any 
longer-term costs presented in today's notice represent extrapolation 
of these results absent any underlying analysis of longer-term 
technology prospects and manufacturers' longer-term product offerings.

 Table VII-9--Estimated Fuel Consumption and GHG Emissions Over Useful Life of HD Pickups and Vans Produced in Each Model Year for Method A, Relative to
                                                                    Alternative 1b a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Fuel consumption  (b. gal.)  over fleet's    GHG emissions  (MMT CO[ihel2]eq)  over fleet's
                                                                            useful life                                     useful life
                       Model year                        -----------------------------------------------------------------------------------------------
                                                             No action         Final      Reduction  (%)     No action         Final      Reduction  (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016....................................................            10.4            10.4             0.0             127             127             0.0
2017....................................................            10.4            10.2             2.0             127             124             2.0
2018....................................................            10.5            10.2             2.9             127             124             2.9
2019....................................................            10.1            9.60             4.8             123             117             4.8
2020....................................................            10.1            9.60             4.6             123             117             4.6
2021....................................................            9.82            9.17             6.6             120             112             6.5
2022....................................................            9.67            9.01             6.9             118             110             6.8
2023....................................................            9.64            8.97             7.0             117             109             6.9
2024....................................................            9.67            9.00             7.0             118             110             6.9
2025....................................................            9.79            8.98             8.3             119             109             8.2
2026....................................................            9.91            8.90            10.2             121             109            10.1
2027....................................................            9.89            8.84            10.7             120             108            10.5
2028....................................................            10.0            8.89            11.1             122             108            10.9

[[Page 73827]]

 
2029....................................................            10.1            8.97            11.2             123             109            11.1
2030....................................................            10.1            8.94            11.2             123             109            11.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.


Table VII-10--Estimated Fuel Consumption and GHG Emissions Over Useful Life of HD Pickups and Vans Produced in Each Model Year for Method A, Relative to
                                                                    Alternative 1a a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Fuel consumption  (b. gal.)  over fleet's    GHG emissions  (MMT CO[ihel2]eq)  over fleet's
                                                                            useful life                                       useful
                       Model year                        -----------------------------------------------------------------------------------------------
                                                             No action         Final       Reduction (%)     No action         Final       Reduction (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016....................................................           10.43           10.43             0.0             122             122             0.0
2017....................................................           10.37           10.15             2.2             122             119             2.2
2018....................................................           10.41           10.10             3.0             122             118             3.1
2019....................................................           10.04            9.55             4.9             118             112             5.1
2020....................................................           10.03            9.56             4.7             118             112             4.9
2021....................................................            9.84            9.16             6.9             115             107             7.1
2022....................................................            9.74            9.01             7.5             114             105             7.7
2023....................................................            9.71            8.97             7.6             114             105             7.8
2024....................................................            9.75            9.00             7.6             114             105             7.8
2025....................................................            9.88            8.97             9.1             116             105             9.3
2026....................................................           10.00            8.92            10.8             117             104            11.1
2027....................................................           10.01            8.84            11.7             117             103            11.9
2028....................................................           10.12            8.89            12.1             119             104            12.4
2029....................................................           10.22            8.98            12.1             120             105            12.4
2030....................................................           10.18            8.95            12.2             119             105            12.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

    To more clearly communicate these trends visually, the following 
two charts present the above results graphically for Method A, relative 
to Alternative 1b. As shown, fuel consumption and GHG emissions follow 
parallel though not precisely identical paths. Though not presented, 
the charts for Alternative 1a will appear sufficiently similar that 
differences between Alternative 1a and Alternative 1b remain best 
communicated by comparing values in the above tables.

[[Page 73828]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.036


[[Page 73829]]



 Table VII-11--Annual Downstream GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs.
                                       Alt 1b Using Analysis Method A \a\
----------------------------------------------------------------------------------------------------------------
                                                                                         Total downstream
                                     CO[ihel2]       CH4  (MMT       N[ihel2]O   -------------------------------
               CY                      (MMT)       CO[ihel2]eq)        (MMT             MMT
                                                                   CO[ihel2]eq)     CO[ihel2]eq      % Change
----------------------------------------------------------------------------------------------------------------
2025............................           -26.5          -0.004           0.002           -26.6            -4.9
2040............................          -103.3           -0.02           0.006          -103.3           -17.0
2050............................          -123.8           -0.03           0.007          -123.8           -18.0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


Table VII-12--Annual Fuel Savings in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt 1b Using Analysis
                                                  Method A \a\
----------------------------------------------------------------------------------------------------------------
                                                              Diesel                         Gasoline
                                                 ---------------------------------------------------------------
                       CY                             Billion                         Billion
                                                      gallons        % Savings        gallons        % Savings
----------------------------------------------------------------------------------------------------------------
2025............................................             2.3             4.9             0.4             5.0
2040............................................             9.2            17.8             1.0            12.2
2050............................................            11.1            19.3             1.2            12.8
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


 Table VII-13--Annual Downstream GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs.
                                       Alt 1a Using Analysis Method A \a\
----------------------------------------------------------------------------------------------------------------
                                                                                         Total downstream
                                     CO[ihel2]       CH4 (MMT     N[ihel2]O (MMT -------------------------------
               CY                      (MMT)       CO[ihel2]eq)    CO[ihel2]eq)         MMT
                                                                                    CO[ihel2]eq      % Change
----------------------------------------------------------------------------------------------------------------
2025............................           -28.9          -0.005           0.003           -28.9            -5.3
2040............................          -114.1           -0.02           0.006          -114.1           -18.0
2050............................          -136.9           -0.03           0.007          -136.9           -20.0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


Table VII-14--Annual Fuel Savings in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt 1a Using Analysis
                                                  Method A \a\
----------------------------------------------------------------------------------------------------------------
                                                Diesel                         Gasoline
                                   ---------------------------------------------------------------
                CY                      Billion                         Billion
                                        gallons        % Savings        gallons        % Savings
--------------------------------------------------------------------------------------------------
2025..............................             2.4             5.2             0.5             5.6
2040..............................            10.2            19.0             1.2            13.0
2050..............................            12.3            21.0             1.3            14.0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

(ii) Upstream (Fuel Production and Distribution) Emissions Projections

Table VII-15--Annual Upstream GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt
                                         1b Using Analysis Method A \a\
----------------------------------------------------------------------------------------------------------------
                                                                                          Total upstream
                                     CO[ihel2]       CH4 (MMT     N[ihel2]O (MMT -------------------------------
               CY                      (MMT)       CO[ihel2]eq)    CO[ihel2]eq)         MMT
                                                                                    CO[ihel2]eq      % Change
----------------------------------------------------------------------------------------------------------------
2025............................            -8.1            -0.9           -0.08            -9.0            -4.9
2040............................           -31.8            -3.4            -0.2           -35.5           -17.0
2050............................           -38.1            -4.2            -0.2           -42.5           -19.0
----------------------------------------------------------------------------------------------------------------
Note:

[[Page 73830]]

 
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


Table VII-16--Annual Upstream GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt
                                         1a Using Analysis Method A \a\
----------------------------------------------------------------------------------------------------------------
                                                                                          Total upstream
                                     CO[ihel2]       CH4 (MMT     N[ihel2]O (MMT -------------------------------
               CY                      (MMT)       CO[ihel2]eq)    CO[ihel2]eq)         MMT
                                                                                    CO[ihel2]eq      % Change
----------------------------------------------------------------------------------------------------------------
2025............................            -8.7            -0.9           -0.09            -9.8            -5.3
2040............................           -35.2            -3.9            -0.2           -39.3           -19.0
2050............................           -42.2            -4.6            -0.3           -47.2           -20.0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

(iii) HFC Emissions Projections
    The projected HFC emission reductions due to the HD Phase 2 air 
conditioning leakage standards for vocational vehicles are 86,735 
metric tons of CO2eq in 2025, 256,061 metric tons of 
CO2eq in 2040, and 314,930 metric tons CO2eq in 
2050. See Chapter 5 of the RIA for additional details on calculations 
of HFC emissions.
(iv) Total (Downstream + Upstream + HFC) Emissions Projections

      Table VII-17--Annual Total GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt 1b Using Analysis Method A \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                                                         -----------------------------------------------------------------------------------------------
                                                                MMT                             MMT                             MMT
                                                            CO[ihel2]eq      % Change       CO[ihel2]eq      % Change       CO[ihel2]eq      % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
Downstream..............................................           -26.6            -4.9          -103.3           -17.0          -123.8           -18.0
Upstream................................................            -9.0            -4.9           -35.5           -17.0           -42.5           -19.0
HFCb....................................................            -0.1           -15.0            -0.3           -13.0            -0.3           -13.0
Total...................................................           -35.7            -4.9          -139.1           -17.0          -166.6           -19.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
\b\ HFC represents HFC emission reductions and percent change from the vocational vehicle category only.


       Table VII-18 Annual Total GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt 1a Using Analysis Method A \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                                                         -----------------------------------------------------------------------------------------------
                                                                MMT                             MMT                             MMT
                                                            CO[ihel2]eq      % Change       CO[ihel2]eq      % Change       CO[ihel2]eq      % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
Downstream..............................................           -28.9            -5.3          -114.1           -18.0          -136.9           -20.0
Upstream................................................            -9.8            -5.3           -39.3           -19.0           -47.2           -20.0
HFC.....................................................            -0.1           -15.0            -0.3           -13.0            -0.3           -13.0
Total...................................................           -38.8            -5.3          -153.7           -19.0          -184.4           -20.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

(b) Model Year Lifetime Analysis

  Table VII-19--Lifetime GHG Reductions and Fuel Savings Using Analysis
             Method A--Summary for Model Years 2018-2029 \a\
------------------------------------------------------------------------
                                           Final program (alternative 3)
    No-action alternative (baseline)     -------------------------------
                                           1b (dynamic)      1a (flat)
------------------------------------------------------------------------
Fuel Savings (Billion Gallons)..........            71.1            77.7
Total GHG Reductions (MMT CO[ihel2]eq)..             958           1,049
    Downstream (MMT CO[ihel2]eq)........             715             781
    Upstream (MMT CO[ihel2]eq)..........             243             268
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.


[[Page 73831]]

(2) Impacts of the Final Rules Using Analysis Method B
(a) Calendar Year Analysis
(i) Downstream (Tailpipe) Emissions Projections
    As described in Section VII.A., Method B used MOVES to estimate 
downstream GHG inventories from the final rules, relative to 
Alternative 1a, for all heavy-duty vehicle categories (including the 
engines associated with tractor-trailer combinations and vocational 
vehicles). The agencies expect reductions in CO2 emissions 
from all heavy-duty vehicle categories due to engine and vehicle 
improvements. We expect N2O emissions to increase very 
slightly because of a rebound in vehicle miles traveled (VMT). However, 
since N2O is produced as a byproduct of fuel combustion, the 
increase in N2O emissions is expected to be more than offset 
by the improvements in fuel efficiency from the final rules.\549\ We 
expect methane emissions to decrease primarily due to reduced refueling 
from improved fuel efficiency and the differences in hydrocarbon 
emission characteristics between on-road diesel engines and APUs. The 
amount of methane emitted as a fraction of total hydrocarbons is 
expected to be less for APUs than for on-road diesel engines during 
extended idling. Overall, the downstream GHG emissions will be reduced 
significantly and are described in the following subsections.
---------------------------------------------------------------------------

    \549\ MOVES is not capable of modeling the changes in exhaust 
N2O emissions from the improvements in fuel efficiency. 
Due to this limitation, a conservative approach was taken to only 
model the VMT rebound in estimating the emissions impact on 
N2O from the final rules, resulting in a slight increase 
in downstream N2O inventory.
---------------------------------------------------------------------------

    Fuel consumption is calculated from the MOVES output of total 
energy consumption converted using the fuel heating values assumed in 
the Renewable Fuels Standard rulemaking \550\ and in MOVES.\551\
---------------------------------------------------------------------------

    \550\ Renewable Fuels Standards assumptions of 115,000 BTU/
gallon gasoline (E0) and 76,330 BTU/gallon ethanol (E100) were 
weighted 90 percent and 10 percent, respectively, for E10 and 85 
percent and 15 percent, respectively, for E15 and converted to kJ at 
1.055 kJ/BTU. The conversion factors are 117,245 kJ/gallon for 
gasoline blended with ten percent ethanol (E10) and 115,205 kJ/
gallon for gasoline blended with fifteen percent ethanol (E15).
    \551\ The conversion factor for diesel is 138,451 kJ/gallon. See 
MOVES2004 Energy and Emission Inputs. EPA420-P-05-003, March 2005. 
http://www3.epa.gov/otaq/models/ngm/420p05003.pdf (last accessed Mar 
15, 2016).
---------------------------------------------------------------------------

    Table VII-20 shows the impacts on downstream GHG emissions and fuel 
savings in 2025, 2040 and 2050, relative to Alternative 1a, for the 
final program.
    Table VII-21 shows the estimated fuel savings from the final 
program in 2025, 2040, and 2050, relative to Alternative 1a. The 
results from the comparable analyses relative to Alternative 1b are 
presented in Section VII.C.(1).

 Table VII-20--Annual Downstream GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs.
                                       Alt 1a Using Analysis Method B \a\
----------------------------------------------------------------------------------------------------------------
                                                                                         Total downstream
                                     CO[ihel2]       CH4 (MMT     N[ihel2]O (MMT -------------------------------
               CY                      (MMT)       CO[ihel2]eq)    CO[ihel2]eq)         MMT
                                                                                    CO[ihel2]eq      % Change
----------------------------------------------------------------------------------------------------------------
2025............................           -27.8           -0.01           0.002           -27.8            -4.6
2040............................          -124.3           -0.02           0.003          -124.3           -18.4
2050............................          -148.4           -0.03           0.004          -148.4            -0.0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


Table VII-21--Annual Fuel Savings in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt 1a Using Analysis
                                                  Method B \a\
----------------------------------------------------------------------------------------------------------------
                                                              Diesel                         Gasoline
                                                 ---------------------------------------------------------------
                       CY                             Billion                         Billion
                                                      gallons        % Savings        gallons        % Savings
----------------------------------------------------------------------------------------------------------------
2025............................................             2.5             5.0             0.3             2.8
2040............................................            10.8            19.4             1.7            13.3
2050............................................            13.0            21.0             1.9            14.4
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

(ii) Upstream (Fuel Production and Distribution) Emissions Projections
    The upstream GHG emission reductions associated with the production 
and distribution of gasoline and diesel from crude oil include the 
domestic emission reductions only. Additionally, since this rulemaking 
is not expected to impact biofuel volumes mandated by the annual 
Renewable Fuel Standards (RFS) regulations \552\, the impacts on 
upstream emissions from changes in biofuel feedstock (i.e., 
agricultural sources such as fertilizer, fugitive dust, and livestock) 
are not shown. In other words, we attribute decreased fuel consumption 
from this program to petroleum-based fuels only, while assuming no net 
effect on volumes of renewable fuels. We used this approach because 
annual renewable fuel volumes are mandated independently from this 
rulemaking under RFS. As a consequence, it is not possible to conclude 
whether the decreasing petroleum consumption projected here would 
increase the fraction of the U.S. fuel supply that is made up by 
renewable fuels (if RFS volumes remained constant), or whether future 
renewable fuel volume mandates would decrease in proportion to the 
decreased petroleum consumption projected here.
---------------------------------------------------------------------------

    \552\ U.S. EPA. 2014 Standards for the Renewable Fuel Standard 
Program. 40 CFR part 80. EPA-HQ-OAR-2013-0479; FRL-9900-90-OAR, RIN 
2060-AR76.
---------------------------------------------------------------------------

    As background, EPA sets annual renewable fuel volume mandates 
through a separate RFS notice-and-comment rulemaking process, and the

[[Page 73832]]

final volumes are based on EIA projections, EPA's own market 
assessment, and information obtained from the RFS notice and comment 
process. Also, RFS standards are nested within each other, which means 
that a fuel with a higher GHG reduction threshold can be used to meet 
the standards for a lower GHG reduction threshold. This creates 
additional uncertainty in projecting this rule's net effect on future 
annual RFS standards.
    In conclusion, the impacts of this rulemaking on annual renewable 
fuel volume mandates are difficult to project at the present time. 
However, since it is not centrally relevant to the analysis for this 
rulemaking, we have not included any impacts on renewable fuel volumes 
in this analysis. The upstream GHG emission reductions of the final 
program can be found in Table VII-22.

Table VII-22--Annual Upstream GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt
                                         1a Using Analysis Method B \a\
----------------------------------------------------------------------------------------------------------------
                                                                                          Total upstream
                                     CO[ihel2]       CH4 (MMT     N[ihel2]O (MMT -------------------------------
               CY                      (MMT)       CO[ihel2]eq)    CO[ihel2]eq)         MMT
                                                                                    CO[ihel2]eq      % CHANGE
----------------------------------------------------------------------------------------------------------------
2025............................            -8.6            -0.9           -0.04            -9.5            -4.7
2040............................           -38.0            -4.0            -0.2           -42.2           -18.7
2050............................           -45.5            -4.8            -0.2           -50.5           -20.3
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

(iii) HFC Emissions Projections
    The projected HFC emission reductions due to the HD Phase 2 air 
conditioning leakage standards for vocational vehicles are 86,735 
metric tons of CO2eq in 2025, 256,061 metric tons of 
CO2eq in 2040, and 314,930 metric tons CO2eq in 
2050. See Chapter 5 of the RIA for additional details on calculations 
of HFC emissions.
(iv) Total (Downstream + Upstream + HFC) Emissions Projections
    Table VII-23 combines the impacts of the final program from 
downstream (Table VII-20), upstream (Table VII-22), and HFC to 
summarize the total GHG reductions in calendar years 2025, 2040 and 
2050, relative to Alternative 1a.

      Table VII-23--Annual Total GHG Emissions Impacts in Calendar Years 2025, 2040 and 2050--Final Program vs. Alt 1a Using Analysis Method B \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                                                         -----------------------------------------------------------------------------------------------
                                                                MMT                             MMT                             MMT
                                                            CO[ihel2]eq      % Change       CO[ihel2]eq      % Change       CO[ihel2]eq      % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
Downstream..............................................           -27.8            -4.6          -124.3           -18.4          -148.4           -20.0
Upstream................................................            -9.5            -4.7           -42.2           -18.7           -50.5           -20.3
HFC b...................................................            -0.1           -15.0            -0.3           -13.0            -0.3           -13.0
Total...................................................           -37.4            -4.7          -166.8           -18.5          -199.2           -20.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
\b\ HFC represents HFC emission reductions and percent change from the vocational vehicle category only.

(b) Model Year Lifetime Analysis
    In addition to the annual GHG emissions and fuel consumption 
reductions expected from the final rules, we estimated the combined 
(downstream and upstream) GHG and fuel consumption impacts for the 
lifetime of the impacted vehicles sold in the regulatory timeframe. 
Table VII-24 shows the fleet-wide GHG reductions and fuel savings from 
the final program, relative to Alternative 1a, through the lifetime of 
heavy-duty vehicles.\553\ For the lifetime GHG reductions and fuel 
savings by vehicle categories, see Chapter 5 of the RIA.
---------------------------------------------------------------------------

    \553\ A lifetime of 30 years is assumed in MOVES.

  Table VII-24--Lifetime GHG Reductions and Fuel Savings Using Analysis
              Method B--Summary for Model Years 2018-2029 a
------------------------------------------------------------------------
                     Model years                         Final program
------------------------------------------------------  (Alternative 3)
                                                      ------------------
           No-action alternative (baseline)                1a (Flat)
------------------------------------------------------------------------
Fuel Savings (Billion Gallons).......................               82.2
Total GHG Reductions (MMT CO[ihel2]eq)...............            1,097.6
Downstream (MMT CO[ihel2]eq).........................              819.2
Upstream (MMT CO[ihel2]eq)...........................              278.4
------------------------------------------------------------------------
Note:

[[Page 73833]]

 
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.

D. Climate Impacts and Indicators

(1) Climate Change Impacts From GHG Emissions
    The impact of GHG emissions on the climate has been reviewed in the 
2009 Endangerment and Cause or Contribute Findings for Greenhouse Gases 
under Section 202(a) of the Clean Air Act, the 2012-2016 light-duty 
vehicle rulemaking, the 2014-2018 heavy-duty vehicle GHG and fuel 
efficiency rulemaking, the 2017-2025 light-duty vehicle rulemaking, and 
the standards for new electricity utility generating units. See 74 FR 
66496; 75 FR 25491; 76 FR 57294; 77 FR 62894; 79 FR 1456-1459; 80 FR 
64662. This section briefly discusses again some of the climate impact 
of EPA's actions in context of transportation emissions. NHTSA has 
analyzed the climate impacts of its specific actions (i.e., excluding 
EPA's HFC regulatory provisions) as well as reasonable alternatives in 
its DEIS that accompanies this final rules. DOT has considered the 
potential climate impacts documented in the DEIS as part of the 
rulemaking process.
    Once emitted, GHGs that are the subject of this regulation can 
remain in the atmosphere for decades to millennia, meaning that (1) 
their concentrations become well-mixed throughout the global atmosphere 
regardless of emission origin, and (2) their effects on climate are 
long lasting. GHG emissions come mainly from the combustion of fossil 
fuels (coal, oil, and gas), with additional contributions from the 
clearing of forests, agricultural activities, cement production, and 
some industrial activities. Transportation activities, in aggregate, 
were the second largest contributor to total U.S. GHG emissions in 2010 
(27 percent of total emissions).\554\
---------------------------------------------------------------------------

    \554\ U.S. EPA (2012) Inventory of U.S. Greenhouse Gas Emissions 
and Sinks: 1990-2010. EPA 430-R-12-001. Available at http://epa.gov/climatechange/emissions/downloads12/US-GHG-Inventory-2012-Main-Text.pdf.
---------------------------------------------------------------------------

    The EPA Administrator relied on thorough and peer-reviewed 
assessments of climate change science prepared by the Intergovernmental 
Panel on Climate Change (``IPCC''), the United States Global Change 
Research Program (``USGCRP''), and the National Research Council of the 
National Academies (``NRC'') \555\ as the primary scientific and 
technical basis for the Endangerment and Cause or Contribute Findings 
for Greenhouse Gases Under Section 202(a) of the Clean Air Act (74 FR 
66496, December 15, 2009). These assessments comprehensively address 
the scientific issues the EPA Administrator had to examine, providing 
her data and information on a wide range of issues pertinent to the 
Endangerment Finding. These assessments have been rigorously reviewed 
by the expert community, and also by United States government agencies 
and scientists, including by EPA itself.
---------------------------------------------------------------------------

    \555\ For a complete list of core references from IPCC, USGCRP/
CCSP, NRC and others relied upon for development of the TSD for 
EPA's Endangerment and Cause or Contribute Findings see Section 
1(b), specifically, Table 1.1 of the TSD. (Docket EPA-HQ-OAR-2010-
0799).
---------------------------------------------------------------------------

    Based on these assessments, the EPA Administrator determined that 
the emissions from new motor vehicles and engines contribute to 
elevated concentrations of greenhouse gases; that these greenhouse 
gases cause warming; that the recent warming has been attributed to the 
increase in greenhouse gases; and that warming of the climate endangers 
the public health and welfare of current and future generations. See 
Coalition for Responsible Regulation v. EPA, 684 F. 3d 102, 121 (D.C. 
Cir. 2012) (upholding all of EPA's findings and stating ``EPA had 
before it substantial record evidence that anthropogenic emissions of 
greenhouse gases `very likely' caused warming of the climate over the 
last several decades. EPA further had evidence of current and future 
effects of this warming on public health and welfare. Relying again 
upon substantial scientific evidence, EPA determined that 
anthropogenically induced climate change threatens both public health 
and public welfare. It found that extreme weather events, changes in 
air quality, increases in food- and water-borne pathogens, and 
increases in temperatures are likely to have adverse health effects. 
The record also supports EPA's conclusion that climate change endangers 
human welfare by creating risk to food production and agriculture, 
forestry, energy, infrastructure, ecosystems, and wildlife. Substantial 
evidence further supported EPA's conclusion that the warming resulting 
from the greenhouse gas emissions could be expected to create risks to 
water resources and in general to coastal areas as a result of expected 
increase in sea level.'')
    A number of major peer-reviewed scientific assessments have been 
released since the administrative record concerning the Endangerment 
Finding closed following EPA's 2010 Reconsideration Denial.\556\ These 
assessments include the ``Special Report on Managing the Risks of 
Extreme Events and Disasters to Advance Climate Change Adaptation'' 
\557\, the 2013-14 Fifth Assessment Report (AR5),\558\ the 2014 
National Climate Assessment report,\559\ the ``Ocean Acidification: A 
National Strategy to Meet the Challenges of a Changing Ocean,'' \560\ 
``Report on Climate Stabilization Targets: Emissions, Concentrations, 
and Impacts over Decades to Millennia,'' \561\ ``National Security 
Implications for U.S. Naval Forces'' (National Security 
Implications),\562\ ``Understanding Earth's Deep Past: Lessons for Our 
Climate Future,'' \563\ ``Sea Level Rise for

[[Page 73834]]

the Coasts of California, Oregon, and Washington: Past, Present, and 
Future,'' \564\ ``Climate and Social Stress: Implications for Security 
Analysis,'' \565\ and ``Abrupt Impacts of Climate Change'' (Abrupt 
Impacts) assessments.\566\
---------------------------------------------------------------------------

    \556\ ``EPA's Denial of the Petitions to Reconsider the 
Endangerment and Cause or Contribute Findings for Greenhouse Gases 
under Section 202(a) of the Clean Air Act,'' 75 FR 49,556 (Aug. 13, 
2010) (``Reconsideration Denial'').
    \557\ Intergovernmental Panel on Climate Change (IPCC). 2012: 
Managing the Risks of Extreme Events and Disasters to Advance 
Climate Change Adaptation. A Special Report of Working Groups I and 
II of the Intergovernmental Panel on Climate Change. Cambridge 
University Press, Cambridge, UK, and New York, NY, USA.
    \558\ Intergovernmental Panel on Climate Change (IPCC). 2013. 
Climate Change 2013: The Physical Science Basis. Contribution of 
Working Group I to the Fifth Assessment Report of the 
Intergovernmental Panel on Climate Change. Cambridge University 
Press, Cambridge, United Kingdom and New York, NY, USA, 
Intergovernmental Panel on Climate Change (IPCC). 2014. Climate 
Change 2014: Impacts, Adaptation, and Vulnerability. Contribution of 
Working Group II to the Fifth Assessment Report of the 
Intergovernmental Panel on Climate Change. Cambridge University 
Press, Cambridge, United Kingdom and New York, NY, USA, 
Intergovernmental Panel on Climate Change (IPCC). 2014. Climate 
Change 2014: Mitigation of Climate Change. Contribution of Working 
Group III to the Fifth Assessment Report of the Intergovernmental 
Panel on Climate Change. Cambridge University Press, Cambridge, 
United Kingdom and New York, NY, USA.
    \559\ Melillo, Jerry M., Terese (T.C.) Richmond, and Gary W. 
Yohe, Eds. 2014. Climate Change Impacts in the United States: The 
Third National Climate Assessment. U.S. Global Change Research 
Program. Available at http://nca2014.globalchange.gov.
    \560\ National Research Council (NRC). 2010. Ocean 
Acidification: A National Strategy to Meet the Challenges of a 
Changing Ocean. National Academies Press. Washington, DC.
    \561\ National Research Council (NRC). 2011. Climate 
Stabilization Targets: Emissions, Concentrations, and Impacts over 
Decades to Millennia. National Academies Press, Washington, DC.
    \562\ National Research Council (NRC) 2011. National Security 
Implications of Climate Change for U.S. Naval Forces. National 
Academies Press. Washington, DC.
    \563\ National Research Council (NRC). 2012. Sea-Level Rise for 
the Coasts of California, Oregon, and Washington: Past, Present, and 
Future. National Academies Press. Washington, DC.
    \564\ National Research Council (NRC). 2012. Sea-Level Rise for 
the Coasts of California, Oregon, and Washington: Past, Present, and 
Future. National Academies Press. Washington, DC.
    \565\ National Research Council (NRC). 2013. Climate and Social 
Stress: Implications for Security Analysis. National Academies 
Press. Washington, DC.
    \566\ National Research Council (NRC). 2013. Abrupt Impacts of 
Climate Change: Anticipating Surprises. National Academies Press. 
Washington, DC.
---------------------------------------------------------------------------

    EPA has reviewed these assessments and finds that, in general, the 
improved understanding of the climate system they present is consistent 
with the assessments underlying the 2009 Endangerment Finding.
    The most recent assessments released were the IPCC AR5 assessments 
between September 2013 and April 2014, the NRC Abrupt Impacts 
assessment in December of 2013, and the U.S. National Climate 
Assessment in May of 2014. The NRC Abrupt Impacts report examines the 
potential for tipping points, thresholds beyond which major and rapid 
changes occur in the Earth's climate system or other systems impacted 
by the climate. The Abrupt Impacts report did find less cause for 
concern than some previous assessments regarding some abrupt events 
within the next century, such as disruption of the Atlantic Meridional 
Overturning Circulation (AMOC) and sudden releases of high-latitude 
methane from hydrates and permafrost, but found that the potential for 
abrupt changes in ecosystems, weather and climate extremes, and 
groundwater supplies critical for agriculture now seem more likely, 
severe, and imminent. The assessment found that some abrupt changes 
were already underway (Arctic sea ice retreat and increases in 
extinction risk due to the speed of climate change) but cautioned that 
even abrupt changes such as the AMOC disruption that are not expected 
in this century can have severe impacts when they happen.
    The IPCC AR5 assessments are also generally consistent with the 
underlying science supporting the 2009 Endangerment Finding. For 
example, confidence in attributing recent warming to human causes has 
increased: The IPCC stated that it is extremely likely (>95 percent 
confidence) that human influences have been the dominant cause of 
recent warming. Moreover, the IPCC found that the last 30 years were 
likely (>66 percent confidence) the warmest 30 year period in the 
Northern Hemisphere of the past 1400 years, that the rate of ice loss 
of worldwide glaciers and the Greenland and Antarctic ice sheets has 
likely increased, that there is medium confidence that the recent 
summer sea ice retreat in the Arctic is larger than it has been in 1450 
years, and that concentrations of carbon dioxide and several other of 
the major greenhouse gases are higher than they have been in at least 
800,000 years. Climate-change induced impacts have been observed in 
changing precipitation patterns, melting snow and ice, species 
migration, negative impacts on crops, increased heat and decreased cold 
mortality, and altered ranges for water-borne illnesses and disease 
vectors. Additional risks from future changes include death, injury, 
and disrupted livelihoods in coastal zones and regions vulnerable to 
inland flooding, food insecurity linked to warming, drought, and 
flooding, especially for poor populations, reduced access to drinking 
and irrigation water for those with minimal capital in semi-arid 
regions, and decreased biodiversity in marine ecosystems, especially in 
the Arctic and tropics, with implications for coastal livelihoods. The 
IPCC determined that ``[c]ontinued emissions of greenhouse gases will 
cause further warming and changes in all components of the climate 
system. Limiting climate change will require substantial and sustained 
reductions of greenhouse gases emissions.''
    Finally, the recently released National Climate Assessment stated, 
``Climate change is already affecting the American people in far 
reaching ways. Certain types of extreme weather events with links to 
climate change have become more frequent and/or intense, including 
prolonged periods of heat, heavy downpours, and, in some regions, 
floods and droughts. In addition, warming is causing sea level to rise 
and glaciers and Arctic sea ice to melt, and oceans are becoming more 
acidic as they absorb carbon dioxide. These and other aspects of 
climate change are disrupting people's lives and damaging some sectors 
of our economy.''
    Assessments from these bodies represent the current state of 
knowledge, comprehensively cover and synthesize thousands of individual 
studies to obtain the majority conclusions from the body of scientific 
literature and undergo a rigorous and exacting standard of review by 
the peer expert community and U.S. government.
    Based on modeling analysis performed by the agencies, reductions in 
CO2 and other GHG emissions associated with these final 
rules will affect future climate change. Since GHGs are well-mixed in 
the atmosphere and have long atmospheric lifetimes, changes in GHG 
emissions will affect atmospheric concentrations of greenhouse gases 
and future climate for decades to millennia, depending on the gas. This 
section provides estimates of the projected change in atmospheric 
CO2 concentrations based on the emission reductions 
estimated for these final rules, compared to the reference case. In 
addition, this section analyzes the response to the changes in GHG 
concentrations of the following climate-related variables: Global mean 
temperature, sea level rise, and ocean pH.
(2) Projected Change in Atmospheric CO2 Concentrations, 
Global Mean Surface Temperature and Sea Level Rise
    To assess the impact of the emissions reductions from the final 
rules, EPA estimated changes in projected atmospheric CO2 
concentrations, global mean surface temperature and sea-level rise to 
2100 using the GCAM (Global Change Assessment Model, formerly MiniCAM), 
integrated assessment model \567\ coupled with the MAGICC (Model for 
the Assessment of Greenhouse-gas Induced Climate Change) simple climate 
model.\568\ GCAM was used to create the globally and temporally 
consistent set of climate relevant emissions required for running 
MAGICC. MAGICC was then used to estimate the projected change in 
relevant climate variables over time. Given the magnitude of the 
estimated

[[Page 73835]]

emissions reductions associated with these rules, a simple climate 
model such as MAGICC is appropriate for estimating the atmospheric and 
climate response.
---------------------------------------------------------------------------

    \567\ GCAM is a long-term, global integrated assessment model of 
energy, economy, agriculture and land use that considers the sources 
of emissions of a suite of greenhouse gases (GHG's), emitted in 14 
globally disaggregated regions, the fate of emissions to the 
atmosphere, and the consequences of changing concentrations of 
greenhouse related gases for climate change. GCAM begins with a 
representation of demographic and economic developments in each 
region and combines these with assumptions about technology 
development to describe an internally consistent representation of 
energy, agriculture, land-use, and economic developments that in 
turn shape global emissions.
    \568\ MAGICC consists of a suite of coupled gas-cycle, climate 
and ice-melt models integrated into a single framework. The 
framework allows the user to determine changes in greenhouse-gas 
concentrations, global-mean surface air temperature and sea-level 
resulting from anthropogenic emissions of carbon dioxide 
(CO2), methane (CH4), nitrous oxide (N2O), 
reactive gases (CO, NOX, VOCs), the halocarbons (e.g. 
HCFCs, HFCs, PFCs) and sulfur dioxide (SO2). MAGICC 
emulates the global-mean temperature responses of more sophisticated 
coupled Atmosphere/Ocean General Circulation Models (AOGCMs) with 
high accuracy.
---------------------------------------------------------------------------

    The analysis projects that the final rules will reduce atmospheric 
concentrations of CO2, global climate warming, ocean 
acidification, and sea level rise relative to the reference case. 
Although the projected reductions and improvements are small in 
comparison to the total projected climate change, they are 
quantifiable, directionally consistent, and will contribute to reducing 
the risks associated with climate change. Climate change is a global 
phenomenon, and EPA recognizes that this one national action alone will 
not prevent it; EPA notes this would be true for any given GHG 
mitigation action when taken alone or when considered in isolation. EPA 
also notes that a substantial portion of CO2 emitted into 
the atmosphere is not removed by natural processes for millennia, and 
therefore each unit of CO2 not emitted into the atmosphere 
due to this rules avoids essentially permanent climate change on 
centennial time scales.
    EPA determines that the projected reductions in atmospheric 
CO2, global mean temperature, sea level rise, and ocean pH 
are meaningful in the context of this action. The results of the 
analysis, summarized in Table VII-25, demonstrate that relative to the 
reference case, by 2100 projected atmospheric CO2 
concentrations are estimated to be reduced by 1.2 to 1.3 part per 
million by volume (ppmv), global mean temperature is estimated to be 
reduced by 0.0027 to 0.0065 [deg]C, and sea-level rise is projected to 
be reduced by approximately 0.026 to 0.058 cm, based on a range of 
climate sensitivities (described below). Details about this modeling 
analysis can be found in the RIA Chapter 6.3.

 Table VII-25--Impact of GHG Emissions Reductions on Projected Changes in Global Climate Associated With Phase 2
                                           Standards for MY 2018-2024
                          [Based on a range of climate sensitivities from 1.5-6 [deg]C]
----------------------------------------------------------------------------------------------------------------
                   Variable                          Units           Year               Projected change
----------------------------------------------------------------------------------------------------------------
Atmospheric CO[ihel2] Concentration...........            ppmv            2100  -1.2 to -1.3
Global Mean Surface Temperature...............          [deg]C            2100  -0.0027 to -0.0065
Sea Level Rise................................              cm            2100  -0.026 to -0.058
Ocean pH......................................        pH units            2100  +0.0006 \a\
----------------------------------------------------------------------------------------------------------------
Note:
\a\ The value for projected change in ocean pH is based on a climate sensitivity of 3.0.

    The projected reductions are small relative to the change in 
temperature (1.8-4.8 [deg]C), CO2 concentration (404 to 470 
ppm), sea level rise (23-56 cm), and ocean acidity (-0.30 pH units) 
from 1990 to 2100 from the MAGICC simulations for the GCAM reference 
case. However, this is to be expected given the magnitude of emissions 
reductions expected from the program in the context of global 
emissions. Moreover, these effects are occurring everywhere around the 
globe, so benefits that appear to be marginal for any one location, 
such as a reduction in sea level rise of half a millimeter, can be 
sizable when the effects are summed along thousands of miles of 
coastline. This uncertainty range does not include the effects of 
uncertainty in future emissions. It should also be noted that the 
calculations in MAGICC do not include the possible effects of 
accelerated ice flow in Greenland and/or Antarctica: estimates of sea 
level rise from the recent NRC, IPCC, and NCA assessments range from 26 
cm to 2 meters depending on the emissions scenario, the processes 
included, and the likelihood range assessed; inclusion of these effects 
would lead to correspondingly larger benefits of mitigation. Further 
discussion of EPA's modeling analysis is found in the RIA, Chapter 6.3.
    Based on the projected atmospheric CO2 concentration 
reductions resulting from these final rules, EPA calculates an increase 
in ocean pH of 0.0006 pH units in 2100 relative to the baseline case 
(this is a reduction in the expected acidification of the ocean of a 
decrease of 0.3 pH units from 1990 to 2100 in the baseline case). Thus, 
this analysis indicates the projected decrease in atmospheric 
CO2 concentrations from the Phase 2 standards will result in 
an increase in ocean pH (i.e., a reduction in the expected 
acidification of the ocean in the reference case). A more detailed 
discussion of the modeling analysis associated with ocean pH is 
provided in the RIA, Chapter 6.3.
    The 2011 NRC assessment on ``Climate Stabilization Targets: 
Emissions, Concentrations, and Impacts over Decades to Millennia'' 
determined how a number of climate impacts--such as heaviest daily 
rainfalls, crop yields, and Arctic sea ice extent--would change with a 
temperature change of 1 degree Celsius (C) of warming. These 
relationships of impacts with temperature change could be combined with 
the calculated reductions in warming in Table VII-25 to estimate 
changes in these impacts associated with this final rulemaking.
    As a substantial portion of CO2 emitted into the 
atmosphere is not removed by natural processes for millennia, each unit 
of CO2 not emitted into the atmosphere avoids some degree of 
effectively permanent climate change. Therefore, reductions in 
emissions in the near term are important in determining climate impacts 
experienced not just over the next decades but over thousands of 
years.\569\ Though the magnitude of the avoided climate change 
projected here in isolation is small in comparison to the total 
projected changes, these reductions represent a reduction in the 
adverse risks associated with climate change (though these risks were 
not formally estimated for this action) across a range of equilibrium 
climate sensitivities. In addition, these reductions are part of a 
larger suite of domestic and international mitigation actions, and 
should be considered in that context.
---------------------------------------------------------------------------

    \569\ National Research Council (NRC) (2011). Climate 
Stabilization Targets: Emissions, Concentrations, and Impacts over 
Decades to Millennia. National Academy Press. Washington, DC. 
(Docket EPA-HQ-OAR-2010-0799).
---------------------------------------------------------------------------

    EPA's analysis of this final rule's impact on global climate 
conditions is intended to quantify these potential reductions using the 
best available science. EPA's modeling results show consistent 
reductions relative to the baseline case in changes of CO2 
concentration, temperature, sea-level rise, and ocean pH over the next 
century.

[[Page 73836]]

VIII. How will these rules impact non-GHG emissions and their 
associated effects?

    The heavy-duty vehicle standards are expected to influence the 
emissions of criteria air pollutants and several hazardous air 
pollutants (air toxics). This section describes the projected impacts 
of the final rules on non-GHG emissions and air quality and the health 
and environmental effects associated with these pollutants. NHTSA 
further analyzes these projected health and environmental effects 
resulting from its final rules and reasonable alternatives in Chapter 4 
of its FEIS.

A. Health Effects of Non-GHG Pollutants

    In this section, we discuss health effects associated with exposure 
to some of the criteria and air toxic pollutants impacted by the final 
heavy-duty vehicle standards.
(1) Particulate Matter
(a) Background
    Particulate matter is a highly complex mixture of solid particles 
and liquid droplets distributed among numerous atmospheric gases which 
interact with solid and liquid phases. Particles range in size from 
those smaller than 1 nanometer (10-9 meter) to over 100 
micrometers ([mu]m, or 10-6 meter) in diameter (for 
reference, a typical strand of human hair is 70 [mu]m in diameter and a 
grain of salt is about 100 [mu]m). Atmospheric particles can be grouped 
into several classes according to their aerodynamic and physical sizes. 
Generally, the three broad classes of particles include ultrafine 
particles (UFPs, generally considered as particulates with a diameter 
less than or equal to 0.1 [mu]m [typically based on physical size, 
thermal diffusivity or electrical mobility])), ``fine'' particles 
(PM2.5; particles with a nominal mean aerodynamic diameter 
less than or equal to 2.5 [mu]m), and ``thoracic'' particles 
(PM10; particles with a nominal mean aerodynamic diameter 
less than or equal to 10 [mu]m).\570\ Particles that fall within the 
size range between PM2.5 and PM10, are referred 
to as ``thoracic coarse particles'' (PM10-2.5, particles 
with a nominal mean aerodynamic diameter less than or equal to 10 [mu]m 
and greater than 2.5 [mu]m). EPA currently has standards that regulate 
PM2.5 and PM10.\571\
---------------------------------------------------------------------------

    \570\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F. Figure 3-1.
    \571\ Regulatory definitions of PM size fractions, and 
information on reference and equivalent methods for measuring PM in 
ambient air, are provided in 40 CFR parts 50, 53, and 58. With 
regard to national ambient air quality standards (NAAQS) which 
provide protection against health and welfare effects, the 24-hour 
PM10 standard provides protection against effects 
associated with short-term exposure to thoracic coarse particles 
(i.e., PM10-2.5).
---------------------------------------------------------------------------

    Particles span many sizes and shapes and may consist of hundreds of 
different chemicals. Particles are emitted directly from sources and 
are also formed through atmospheric chemical reactions; the former are 
often referred to as ``primary'' particles, and the latter as 
``secondary'' particles. Particle concentration and composition varies 
by time of year and location, and, in addition to differences in source 
emissions, is affected by several weather-related factors, such as 
temperature, clouds, humidity, and wind. A further layer of complexity 
comes from particles' ability to shift between solid/liquid and gaseous 
phases, which is influenced by concentration and meteorology, 
especially temperature.
    Fine particles are produced primarily by combustion processes and 
by transformations of gaseous emissions (e.g., sulfur oxides 
(SOX), oxides of nitrogen, and volatile organic compounds 
(VOC)) in the atmosphere. The chemical and physical properties of 
PM2.5 may vary greatly with time, region, meteorology, and 
source category. Thus, PM2.5 may include a complex mixture 
of different components including sulfates, nitrates, organic 
compounds, elemental carbon and metal compounds. These particles can 
remain in the atmosphere for days to weeks and travel hundreds to 
thousands of kilometers.
(b) Health Effects of PM
    Scientific studies show exposure to ambient PM is associated with a 
broad range of health effects. These health effects are discussed in 
detail in the Integrated Science Assessment for Particulate Matter (PM 
ISA), which was finalized in December 2009.\572\ The PM ISA summarizes 
health effects evidence for short- and long-term exposures to 
PM2.5, PM10-2.5, and ultrafine particles.\573\ 
The PM ISA concludes that human exposures to ambient PM2.5 
are associated with a number of adverse health effects and 
characterizes the weight of evidence for broad health categories (e.g., 
cardiovascular effects, respiratory effects, etc.).\574\ The discussion 
below highlights the PM ISA's conclusions pertaining to health effects 
associated with both short- and long-term PM exposures. Further 
discussion of health effects associated with PM can also be found in 
the rulemaking documents for the most recent review of the PM NAAQS 
completed in 2012.575 576
---------------------------------------------------------------------------

    \572\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F.
    \573\ The ISA also evaluated evidence for PM components but did 
not reach causal determinations for components.
    \574\ The causal framework draws upon the assessment and 
integration of evidence from across epidemiological, controlled 
human exposure, and toxicological studies, and the related 
uncertainties that ultimately influence our understanding of the 
evidence. This framework employs a five-level hierarchy that 
classifies the overall weight of evidence and causality using the 
following categorizations: causal relationship, likely to be causal 
relationship, suggestive of a causal relationship, inadequate to 
infer a causal relationship, and not likely to be a causal 
relationship (U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F, Table 1-3).
    \575\ 78 FR 3103-3104, January 15, 2013.
    \576\ 77 FR 38906-38911, June 29, 2012.
---------------------------------------------------------------------------

    EPA has concluded that ``a causal relationship exists'' between 
both long- and short-term exposures to PM2.5 and premature 
mortality and cardiovascular effects and that ``a causal relationship 
is likely to exist'' between long- and short-term PM2.5 
exposures and respiratory effects. Further, there is evidence 
``suggestive of a causal relationship'' between long-term 
PM2.5 exposures and other health effects, including 
developmental and reproductive effects (e.g., low birth weight, infant 
mortality) and carcinogenic, mutagenic, and genotoxic effects (e.g., 
lung cancer mortality).\577\
---------------------------------------------------------------------------

    \577\ These causal inferences are based not only on the more 
expansive epidemiological evidence available in this review but also 
reflect consideration of important progress that has been made to 
advance our understanding of a number of potential biologic modes of 
action or pathways for PM-related cardiovascular and respiratory 
effects (U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F, Chapter 5).
---------------------------------------------------------------------------

    As summarized in the final rule resulting from the last review 
(2012) of the PM NAAQS, and discussed extensively in the 2009 p.m. ISA, 
the available scientific evidence significantly strengthens the link 
between long- and short-term exposure to PM2.5 and 
mortality, while providing indications that the magnitude of the 
PM2.5- mortality association with long-term exposures may be 
larger than previously estimated.578 579 The strongest 
evidence comes from recent

[[Page 73837]]

studies investigating long-term exposure to PM2.5 and 
cardiovascular-related mortality. The evidence supporting a causal 
relationship between long-term PM2.5 exposure and mortality 
also includes consideration of studies that demonstrated an improvement 
in community health following reductions in ambient fine particles.
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    \578\ 78 FR 3103-3104, January 15, 2013.
    \579\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F, Chapter 6 (Section 6.5) 
and Chapter 7 (Section 7.6).
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    Several studies evaluated in the 2009 p.m. ISA have examined the 
association between cardiovascular effects and long-term 
PM2.5 exposures in multi-city epidemiological studies 
conducted in the U.S. and Europe. These studies have provided new 
evidence linking long-term exposure to PM2.5 with an array 
of cardiovascular effects such as heart attacks, congestive heart 
failure, stroke, and mortality. This evidence is coherent with studies 
of effects associated with short-term exposure to PM2.5 that 
have observed associations with a continuum of effects ranging from 
subtle changes in indicators of cardiovascular health to serious 
clinical events, such as increased hospitalizations and emergency 
department visits due to cardiovascular disease and cardiovascular 
mortality.\580\
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    \580\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F, Chapter 2 (Section 2.3.1 
and 2.3.2) and Chapter 6.
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    As detailed in the 2009 p.m. ISA, extended analyses of seminal 
epidemiological studies, as well as more recent epidemiological studies 
conducted in the U.S. and abroad, provide strong evidence of 
respiratory-related morbidity effects associated with long-term 
PM2.5 exposure. The strongest evidence for respiratory-
related effects is from studies that evaluated decrements in lung 
function growth (in children), increased respiratory symptoms, and 
asthma development. The strongest evidence from short-term 
PM2.5 exposure studies has been observed for increased 
respiratory-related emergency department visits and hospital admissions 
for chronic obstructive pulmonary disease (COPD) and respiratory 
infections.\581\
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    \581\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F, Chapter 2 (Section 2.3.1 
and 2.3.2) and Chapter 6.
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    The body of scientific evidence detailed in the 2009 PM ISA is 
still limited with respect to associations between long-term 
PM2.5 exposures and developmental and reproductive effects 
as well as cancer, mutagenic, and genotoxic effects. The strongest 
evidence for an association between PM2.5 and developmental 
and reproductive effects comes from epidemiological studies of low 
birth weight and infant mortality, especially due to respiratory causes 
during the post-neonatal period (i.e., 1 month to 12 months of 
age).\582\ With regard to cancer effects, ``[m]ultiple epidemiologic 
studies have shown a consistent positive association between 
PM2.5 and lung cancer mortality, but studies have generally 
not reported associations between PM2.5 and lung cancer 
incidence.'' \583\
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    \582\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F, Chapter 2 (Section 2.3.1 
and 2.3.2) and Chapter 7.
    \583\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F. pg 2-13.
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    In addition to evaluating the health effects attributed to short- 
and long-term exposure to PM2.5, the 2009 PM ISA also 
evaluated whether specific components or sources of PM2.5 
are more strongly associated with specific health effects. An 
evaluation of those studies resulted in the 2009 PM ISA concluding that 
``many [components] of PM can be linked with differing health effects 
and the evidence is not yet sufficient to allow differentiation of 
those [components] or sources that are more closely related to specific 
health outcomes.'' \584\
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    \584\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F. pg 2-26.
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    For PM10-2.5, the 2009 PM ISA concluded that available 
evidence was ``suggestive of a causal relationship'' between short-term 
exposures to PM10-2.5 and cardiovascular effects (e.g., 
hospital admissions and Emergency Department (ED) visits, changes in 
cardiovascular function), respiratory effects (e.g., ED visits and 
hospital admissions, increase in markers of pulmonary inflammation), 
and premature mortality. The scientific evidence was ``inadequate to 
infer a causal relationship'' between long-term exposure to 
PM10-2.5 and various health effects.585 586 587
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    \585\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F. Section 2.3.4 and Table 
2-6.
    \586\ 78 FR 3167-3168, January 15, 2013.
    \587\ 77 FR 38947-38951, June 29, 2012.
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    For UFPs, the 2009 PM ISA concluded that the evidence was 
``suggestive of a causal relationship'' between short-term exposures 
and cardiovascular effects, including changes in heart rhythm and 
vasomotor function (the ability of blood vessels to expand and 
contract). It also concluded that there was evidence ``suggestive of a 
causal relationship'' between short-term exposure to UFPs and 
respiratory effects, including lung function and pulmonary 
inflammation, with limited and inconsistent evidence for increases in 
ED visits and hospital admissions. Scientific evidence was ``inadequate 
to infer a causal relationship'' between short-term exposure to UFPs 
and additional health effects including premature mortality as well as 
long-term exposure to UFPs and all health outcomes 
evaluated.588 589
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    \588\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F. Section 2.3.5 and Table 
2-6.
    \589\ 78 FR 3121, January 15, 2013.
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    The 2009 PM ISA conducted an evaluation of specific groups within 
the general population potentially at increased risk for experiencing 
adverse health effects related to PM 
exposures.590 591 592 593 The evidence detailed in the 2009 
PM ISA expands our understanding of previously identified at-risk 
populations and lifestages (i.e., children, older adults, and 
individuals with pre-existing heart and lung disease) and supports the 
identification of additional at-risk populations (e.g., persons with 
lower socioeconomic status, genetic differences). Additionally, there 
is emerging, though still limited, evidence for additional potentially 
at-risk populations and lifestages, such as those with diabetes, people 
who are obese, pregnant women, and the developing fetus.\594\
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    \590\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F. Chapter 8 and Chapter 2.
    \591\ 77 FR 38890, June 29, 2012.
    \592\ 78 FR 3104, January 15, 2013.
    \593\ U.S. EPA. (2011). Policy Assessment for the Review of the 
PM NAAQS. U.S. Environmental Protection Agency, Washington, DC, EPA/
452/R-11-003. Section 2.2.1.
    \594\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F. Chapter 8 and Chapter 2 
(Section 2.4.1).
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(2) Ozone
(a) Background
    Ground-level ozone pollution is typically formed through reactions 
involving VOC and NOX in the lower atmosphere in the 
presence of sunlight. These pollutants, often referred to as ozone 
precursors, are emitted by many types of pollution sources, such as 
highway and nonroad motor vehicles and engines, power plants, chemical

[[Page 73838]]

plants, refineries, makers of consumer and commercial products, 
industrial facilities, and smaller area sources.
    The science of ozone formation, transport, and accumulation is 
complex. Ground-level ozone is produced and destroyed in a cyclical set 
of chemical reactions, many of which are sensitive to temperature and 
sunlight. When ambient temperatures and sunlight levels remain high for 
several days and the air is relatively stagnant, ozone and its 
precursors can build up and result in more ozone than typically occurs 
on a single high-temperature day. Ozone and its precursors can be 
transported hundreds of miles downwind from precursor emissions, 
resulting in elevated ozone levels even in areas with low local VOC or 
NOX emissions.
(b) Health Effects of Ozone
    This section provides a summary of the health effects associated 
with exposure to ambient concentrations of ozone.\595\ The information 
in this section is based on the information and conclusions in the 
February 2013 Integrated Science Assessment for Ozone (Ozone ISA), 
which formed the basis for EPA's revision to the primary and secondary 
standards in 2015.\596\ The Ozone ISA concludes that human exposures to 
ambient concentrations of ozone are associated with a number of adverse 
health effects and characterizes the weight of evidence for these 
health effects.\597\ The discussion below highlights the Ozone ISA's 
conclusions pertaining to health effects associated with both short-
term and long-term periods of exposure to ozone.
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    \595\ Human exposure to ozone varies over time due to changes in 
ambient ozone concentration and because people move between 
locations which have notable different ozone concentrations. Also, 
the amount of ozone delivered to the lung is not only influenced by 
the ambient concentrations but also by the individuals breathing 
route and rate.
    \596\ U.S. EPA. Integrated Science Assessment of Ozone and 
Related Photochemical Oxidants (Final Report). U.S. Environmental 
Protection Agency, Washington, DC, EPA/600/R-10/076F, 2013. The ISA 
is available at http://cfpub.epa.gov/ncea/isa/recordisplay.cfm?deid=247492#Download.
    \597\ The ISA evaluates evidence and draws conclusions on the 
causal nature of relationship between relevant pollutant exposures 
and health effects, assigning one of five ``weight of evidence'' 
determinations: causal relationship, likely to be a causal 
relationship, suggestive of, but not sufficient to infer, a causal 
relationship, inadequate to infer a causal relationship, and not 
likely to be a causal relationship. For more information on these 
levels of evidence, please refer to Table II in the Preamble of the 
ISA.
---------------------------------------------------------------------------

    For short-term exposure to ozone, the Ozone ISA concludes that 
respiratory effects, including lung function decrements, pulmonary 
inflammation, exacerbation of asthma, respiratory-related hospital 
admissions, and mortality, are causally associated with ozone exposure. 
It also concludes that cardiovascular effects, including decreased 
cardiac function and increased vascular disease, and total mortality 
are likely to be causally associated with short-term exposure to ozone 
and that evidence is suggestive of a causal relationship between 
central nervous system effects and short-term exposure to ozone.
    For long-term exposure to ozone, the Ozone ISA concludes that 
respiratory effects, including new onset asthma, pulmonary inflammation 
and injury, are likely to be causally related with ozone exposure. The 
Ozone ISA characterizes the evidence as suggestive of a causal 
relationship for associations between long-term ozone exposure and 
cardiovascular effects, reproductive and developmental effects, central 
nervous system effects and total mortality. The evidence is inadequate 
to infer a causal relationship between chronic ozone exposure and 
increased risk of lung cancer.
    Finally, inter-individual variation in human responses to ozone 
exposure can result in some groups being at increased risk for 
detrimental effects in response to exposure. In addition, some groups 
are at increased risk of exposure due to their activities, such as 
outdoor workers or children. The Ozone ISA identified several groups 
that are at increased risk for ozone-related health effects. These 
groups are people with asthma, children and older adults, individuals 
with reduced intake of certain nutrients (i.e., Vitamins C and E), 
outdoor workers, and individuals having certain genetic variants 
related to oxidative metabolism or inflammation. Ozone exposure during 
childhood can have lasting effects through adulthood. Such effects 
include altered function of the respiratory and immune systems. 
Children absorb higher doses (normalized to lung surface area) of 
ambient ozone, compared to adults, due to their increased time spent 
outdoors, higher ventilation rates relative to body size, and a 
tendency to breathe a greater fraction of air through the mouth. 
Children also have a higher asthma prevalence compared to adults. 
Additional children's vulnerability and susceptibility factors are 
listed in Section XIV.
(3) Nitrogen Oxides
(a) Background
    Oxides of nitrogen (NOX) refers to nitric oxide and 
nitrogen dioxide (NO2). For the NOX NAAQS, 
NO2 is the indicator. Most NO2 is formed in the 
air through the oxidation of nitric oxide (NO) emitted when fuel is 
burned at a high temperature. NOX is also a major 
contributor to secondary PM2.5 formation. The health effects 
of ambient PM are discussed in Section VIII.A.1.b of this Preamble. 
NOX and VOC are the two major precursors of ozone. The 
health effects of ozone are covered in Section VIII.A.2.b.
(b) Health Effects of Nitrogen Oxides
    The most recent review of the health effects of oxides of nitrogen 
completed by EPA can be found in the 2016 Integrated Science Assessment 
for Oxides of Nitrogen--Health Criteria (Oxides of Nitrogen ISA).\598\ 
The primary source of NO2 is motor vehicle emissions, and 
ambient NO2 concentrations tend to be highly correlated with 
other traffic-related pollutants. Thus, a key issue in characterizing 
the causality of NO2-health effect relationships was 
evaluating the extent to which studies supported an effect of 
NO2 that is independent of other traffic-related pollutants. 
EPA concluded that the findings for asthma exacerbation integrated from 
epidemiologic and controlled human exposure studies provided evidence 
that is sufficient to infer a causal relationship between respiratory 
effects and short-term NO2 exposure. The strongest evidence 
supporting an independent effect of NO2 exposure comes from 
controlled human exposure studies demonstrating increased airway 
responsiveness in individuals with asthma following ambient-relevant 
NO2 exposures. The coherence of this evidence with 
epidemiologic findings for asthma hospital admissions and ED visits as 
well as lung function decrements and increased pulmonary inflammation 
in children with asthma describe a plausible pathway by which 
NO2 exposure can cause an asthma exacerbation. The 2016 ISA 
for Oxides of Nitrogen also concluded that there is likely to be a 
causal relationship between long-term NO2 exposure and 
respiratory effects. This conclusion is based on new epidemiologic 
evidence for associations of NO2 with asthma development in 
children combined with biological plausibility from experimental 
studies.
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    \598\ U.S. EPA. Integrated Science Assessment for Oxides of 
Nitrogen--Health Criteria (2016 Final Report). U.S. Environmental 
Protection Agency, Washington, DC, EPA/600/R-15/068, 2016.
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    In evaluating a broader range of health effects, the 2016 ISA for 
Oxides of Nitrogen concluded evidence is ``suggestive of, but not 
sufficient to infer, a causal relationship'' between

[[Page 73839]]

short-term NO2 exposure and cardiovascular effects and 
mortality and between long-term NO2 exposure and 
cardiovascular effects and diabetes, birth outcomes, and cancer. In 
addition, the scientific evidence is inadequate (insufficient 
consistency of epidemiologic and toxicological evidence) to infer a 
causal relationship for long-term NO2 exposure with 
fertility, reproduction, and pregnancy, as well as with postnatal 
development. A key uncertainty in understanding the relationship 
between these non-respiratory health effects and short- or long-term 
exposure to NO2 is copollutant confounding, particularly by 
other roadway pollutants. The available evidence for non-respiratory 
health effects does not adequately address whether NO2 has 
an independent effect or whether it primarily represents effects 
related to other or a mixture of traffic-related pollutants.
    The 2016 ISA for Oxides of Nitrogen concluded that people with 
asthma, children, and older adults are at increased risk for 
NO2-related health effects. In these groups and lifestages, 
NO2 is consistently related to larger effects on outcomes 
related to asthma exacerbation, for which there is confidence in the 
relationship with NO2 exposure.
(4) Sulfur Oxides
(a) Background
    Sulfur dioxide (SO2), a member of the sulfur oxide 
(SOX) family of gases, is formed from burning fuels 
containing sulfur (e.g., coal or oil derived), extracting gasoline from 
oil, or extracting metals from ore. SO2 and its gas phase 
oxidation products can dissolve in water droplets and further oxidize 
to form sulfuric acid which reacts with ammonia to form sulfates, which 
are important components of ambient PM. The health effects of ambient 
PM are discussed in Section VIII.A.1.b of this Preamble.
(b) Health Effects of SO2
    Information on the health effects of SO2 can be found in 
the 2008 Integrated Science Assessment for Sulfur Oxides--Health 
Criteria (SOX ISA).\599\ Short-term peaks (5-10 minutes) of 
SO2 have long been known to cause adverse respiratory health 
effects, particularly among individuals with asthma. In addition to 
those with asthma (both children and adults), potentially at-risk 
lifestages include all children and the elderly. During periods of 
elevated ventilation, asthmatics may experience symptomatic 
bronchoconstriction within minutes of exposure. Following an extensive 
evaluation of health evidence from epidemiologic and laboratory 
studies, EPA concluded that there is a causal relationship between 
respiratory health effects and short-term exposure to SO2. 
Separately, based on an evaluation of the epidemiologic evidence of 
associations between short-term exposure to SO2 and 
mortality, EPA concluded that the overall evidence is suggestive of a 
causal relationship between short-term exposure to SO2 and 
mortality. Additional information on the health effects of 
SO2 is available in Chapter 6.1.1.4.2 of the RIA.
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    \599\ U.S. EPA. (2008). Integrated Science Assessment (ISA) for 
Sulfur Oxides--Health Criteria (Final Report). EPA/600/R-08/047F. 
Washington, DC: U.S. Environmental Protection Agency.
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(5) Carbon Monoxide
(a) Background
    Carbon monoxide (CO) is a colorless, odorless gas emitted from 
combustion processes. Nationally, particularly in urban areas, the 
majority of CO emissions to ambient air come from mobile sources.\600\
---------------------------------------------------------------------------

    \600\ U.S. EPA, (2010). Integrated Science Assessment for Carbon 
Monoxide (Final Report). U.S. Environmental Protection Agency, 
Washington, DC, EPA/600/R-09/019F, 2010. Available at http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=218686. See Section 
2.1.
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(b) Health Effects of Carbon Monoxide
    Information on the health effects of CO can be found in the January 
2010 Integrated Science Assessment for Carbon Monoxide (CO ISA).\601\ 
The CO ISA presents conclusions regarding the presence of causal 
relationships between CO exposure and categories of adverse health 
effects.\602\ This section provides a summary of the health effects 
associated with exposure to ambient concentrations of CO, along with 
the ISA conclusions.\603\
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    \601\ U.S. EPA, (2010). Integrated Science Assessment for Carbon 
Monoxide (Final Report). U.S. Environmental Protection Agency, 
Washington, DC, EPA/600/R-09/019F, 2010. Available at http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=218686.
    \602\ The ISA evaluates the health evidence associated with 
different health effects, assigning one of five ``weight of 
evidence'' determinations: causal relationship, likely to be a 
causal relationship, suggestive of a causal relationship, inadequate 
to infer a causal relationship, and not likely to be a causal 
relationship. For definitions of these levels of evidence, please 
refer to Section 1.6 of the ISA.
    \603\ Personal exposure includes contributions from many 
sources, and in many different environments. Total personal exposure 
to CO includes both ambient and nonambient components; and both 
components may contribute to adverse health effects.
---------------------------------------------------------------------------

    Controlled human exposure studies of subjects with coronary artery 
disease show a decrease in the time to onset of exercise-induced angina 
(chest pain) and electrocardiogram changes following CO exposure. In 
addition, epidemiologic studies observed associations between short-
term CO exposure and cardiovascular morbidity, particularly increased 
emergency room visits and hospital admissions for coronary heart 
disease (including ischemic heart disease, myocardial infarction, and 
angina). Some epidemiologic evidence is also available for increased 
hospital admissions and emergency room visits for congestive heart 
failure and cardiovascular disease as a whole. The CO ISA concludes 
that a causal relationship is likely to exist between short-term 
exposures to CO and cardiovascular morbidity. It also concludes that 
available data are inadequate to conclude that a causal relationship 
exists between long-term exposures to CO and cardiovascular morbidity.
    Animal studies show various neurological effects with in-utero CO 
exposure. Controlled human exposure studies report central nervous 
system and behavioral effects following low-level CO exposures, 
although the findings have not been consistent across all studies. The 
CO ISA concludes the evidence is suggestive of a causal relationship 
with both short- and long-term exposure to CO and central nervous 
system effects.
    A number of studies cited in the CO ISA have evaluated the role of 
CO exposure in birth outcomes such as preterm birth or cardiac birth 
defects. There is limited epidemiologic evidence of a CO-induced effect 
on preterm births and birth defects, with weak evidence for a decrease 
in birth weight. Animal toxicological studies have found perinatal CO 
exposure to affect birth weight, as well as other developmental 
outcomes. The CO ISA concludes the evidence is suggestive of a causal 
relationship between long-term exposures to CO and developmental 
effects and birth outcomes.
    Epidemiologic studies provide evidence of associations between 
short-term CO concentrations and respiratory morbidity such as changes 
in pulmonary function, respiratory symptoms, and hospital admissions. A 
limited number of epidemiologic studies considered copollutants such as 
ozone, SO2, and PM in two-pollutant models and found that CO 
risk estimates were generally robust, although this limited evidence 
makes it difficult to disentangle effects attributed to CO itself from 
those of the larger complex air pollution mixture. Controlled human 
exposure studies have not extensively

[[Page 73840]]

evaluated the effect of CO on respiratory morbidity. Animal studies at 
levels of 50-100 ppm CO show preliminary evidence of altered pulmonary 
vascular remodeling and oxidative injury. The CO ISA concludes that the 
evidence is suggestive of a causal relationship between short-term CO 
exposure and respiratory morbidity, and inadequate to conclude that a 
causal relationship exists between long-term exposure and respiratory 
morbidity.
    Finally, the CO ISA concludes that the epidemiologic evidence is 
suggestive of a causal relationship between short-term concentrations 
of CO and mortality. Epidemiologic evidence suggests an association 
exists between short-term exposure to CO and mortality, but limited 
evidence is available to evaluate cause-specific mortality outcomes 
associated with CO exposure. In addition, the attenuation of CO risk 
estimates which was often observed in copollutant models contributes to 
the uncertainty as to whether CO is acting alone or as an indicator for 
other combustion-related pollutants. The CO ISA also concludes that 
there is not likely to be a causal relationship between relevant long-
term exposures to CO and mortality.
(6) Diesel Exhaust
(a) Background
    Diesel exhaust consists of a complex mixture composed of 
particulate matter, carbon dioxide, oxygen, nitrogen, water vapor, 
carbon monoxide, nitrogen compounds, sulfur compounds and numerous low-
molecular-weight hydrocarbons. A number of these gaseous hydrocarbon 
components are individually known to be toxic, including aldehydes, 
benzene and 1,3-butadiene. The diesel particulate matter present in 
diesel exhaust consists mostly of fine particles (<2.5 [mu]m), of which 
a significant fraction is ultrafine particles (<0.1 [mu]m). These 
particles have a large surface area which makes them an excellent 
medium for adsorbing organics, and their small size makes them highly 
respirable. Many of the organic compounds present in the gases and on 
the particles, such as polycyclic organic matter, are individually 
known to have mutagenic and carcinogenic properties.
    Diesel exhaust varies significantly in chemical composition and 
particle sizes between different engine types (heavy-duty, light-duty), 
engine operating conditions (idle, acceleration, deceleration), and 
fuel formulations (high/low sulfur fuel). Also, there are emissions 
differences between on-road and nonroad engines because the nonroad 
engines are generally of older technology. After being emitted in the 
engine exhaust, diesel exhaust undergoes dilution as well as chemical 
and physical changes in the atmosphere. The lifetime for some of the 
compounds present in diesel exhaust ranges from hours to days.
(b) Health Effects of Diesel Exhaust
    In EPA's 2002 Diesel Health Assessment Document (Diesel HAD), 
exposure to diesel exhaust was classified as likely to be carcinogenic 
to humans by inhalation from environmental exposures, in accordance 
with the revised draft 1996/1999 EPA cancer 
guidelines.604 605 A number of other agencies (National 
Institute for Occupational Safety and Health, the International Agency 
for Research on Cancer, the World Health Organization, California EPA, 
and the U.S. Department of Health and Human Services) had made similar 
hazard classifications prior to 2002. EPA also concluded in the 2002 
Diesel HAD that it was not possible to calculate a cancer unit risk for 
diesel exhaust due to limitations in the exposure data for the 
occupational groups or the absence of a dose-response relationship.
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    \604\ U.S. EPA. (1999). Guidelines for Carcinogen Risk 
Assessment. Review Draft. NCEA-F-0644, July. Washington, DC: U.S. 
EPA. Retrieved on March 19, 2009 from http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=54932.
    \605\ U.S. EPA (2002). Health Assessment Document for Diesel 
Engine Exhaust. EPA/600/8-90/057F Office of Research and 
Development, Washington DC. Retrieved on March 17, 2009 from http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=29060. pp. 1-1 1-2.
---------------------------------------------------------------------------

    In the absence of a cancer unit risk, the Diesel HAD sought to 
provide additional insight into the significance of the diesel exhaust 
cancer hazard by estimating possible ranges of risk that might be 
present in the population. An exploratory analysis was used to 
characterize a range of possible lung cancer risk. The outcome was that 
environmental risks of cancer from long-term diesel exhaust exposures 
could plausibly range from as low as 10-5 to as high as 
10-3. Because of uncertainties, the analysis acknowledged 
that the risks could be lower than 10-5, and a zero risk 
from diesel exhaust exposure could not be ruled out.
    Non-cancer health effects of acute and chronic exposure to diesel 
exhaust emissions are also of concern to EPA. EPA derived a diesel 
exhaust reference concentration (RfC) from consideration of four well-
conducted chronic rat inhalation studies showing adverse pulmonary 
effects. The RfC is 5 [mu]g/m\3\ for diesel exhaust measured as diesel 
particulate matter. This RfC does not consider allergenic effects such 
as those associated with asthma or immunologic or the potential for 
cardiac effects. There was emerging evidence in 2002, discussed in the 
Diesel HAD, that exposure to diesel exhaust can exacerbate these 
effects, but the exposure-response data were lacking at that time to 
derive an RfC based on these then-emerging considerations. The EPA 
Diesel HAD states, ``With [diesel particulate matter] being a 
ubiquitous component of ambient PM, there is an uncertainty about the 
adequacy of the existing [diesel exhaust] noncancer database to 
identify all of the pertinent [diesel exhaust]-caused noncancer health 
hazards.'' The Diesel HAD also notes ``that acute exposure to [diesel 
exhaust] has been associated with irritation of the eye, nose, and 
throat, respiratory symptoms (cough and phlegm), and neurophysiological 
symptoms such as headache, lightheadedness, nausea, vomiting, and 
numbness or tingling of the extremities.'' The Diesel HAD noted that 
the cancer and noncancer hazard conclusions applied to the general use 
of diesel engines then on the market and as cleaner engines replace a 
substantial number of existing ones, the applicability of the 
conclusions would need to be reevaluated.
    It is important to note that the Diesel HAD also briefly summarizes 
health effects associated with ambient PM and discusses EPA's then-
annual PM2.5 NAAQS of 15 [mu]g/m\3\. In 2012, EPA revised 
the annual PM2.5 NAAQS to 12 [mu]g/m\3\. There is a large 
and extensive body of human data showing a wide spectrum of adverse 
health effects associated with exposure to ambient PM, of which diesel 
exhaust is an important component. The PM2.5 NAAQS is 
designed to provide protection from the noncancer health effects and 
premature mortality attributed to exposure to PM2.5. The 
contribution of diesel PM to total ambient PM varies in different 
regions of the country and also, within a region, from one area to 
another. The contribution can be high in near-roadway environments, for 
example, or in other locations where diesel engine use is concentrated.
    Since 2002, several new studies have been published which continue 
to report increased lung cancer risk with occupational exposure to 
diesel exhaust from older engines. Of particular note since 2011 are 
three new epidemiology studies which have examined lung cancer in 
occupational populations, for example, truck drivers, underground 
nonmetal miners and other diesel

[[Page 73841]]

motor-related occupations. These studies reported increased risk of 
lung cancer with exposure to diesel exhaust with evidence of positive 
exposure-response relationships to varying 
degrees.606 607 608 These newer studies (along with others 
that have appeared in the scientific literature) add to the evidence 
EPA evaluated in the 2002 Diesel HAD and further reinforces the concern 
that diesel exhaust exposure likely poses a lung cancer hazard. The 
findings from these newer studies do not necessarily apply to newer 
technology diesel engines since the newer engines have large reductions 
in the emission constituents compared to older technology diesel 
engines.
---------------------------------------------------------------------------

    \606\ Garshick, Eric, Francine Laden, Jaime E. Hart, Mary E. 
Davis, Ellen A. Eisen, and Thomas J. Smith. 2012. Lung cancer and 
elemental carbon exposure in trucking industry workers. 
Environmental Health Perspectives 120(9): 1301-1306.
    \607\ Silverman, D. T., Samanic, C. M., Lubin, J. H., Blair, A. 
E., Stewart, P. A., Vermeulen, R., & Attfield, M. D. (2012). The 
diesel exhaust in miners study: A nested case-control study of lung 
cancer and diesel exhaust. Journal of the National Cancer Institute.
    \608\ Olsson, Ann C., et al. ``Exposure to diesel motor exhaust 
and lung cancer risk in a pooled analysis from case-control studies 
in Europe and Canada.'' American journal of respiratory and critical 
care medicine 183.7 (2011): 941-948.
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    In light of the growing body of scientific literature evaluating 
the health effects of exposure to diesel exhaust, in June 2012 the 
World Health Organization's International Agency for Research on Cancer 
(IARC), a recognized international authority on the carcinogenic 
potential of chemicals and other agents, evaluated the full range of 
cancer-related health effects data for diesel engine exhaust. IARC 
concluded that diesel exhaust should be regarded as ``carcinogenic to 
humans.'' \609\ This designation was an update from its 1988 evaluation 
that considered the evidence to be indicative of a ``probable human 
carcinogen.''
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    \609\ IARC [International Agency for Research on Cancer]. 
(2013). Diesel and gasoline engine exhausts and some nitroarenes. 
IARC Monographs Volume 105. [Online at http://monographs.iarc.fr/ENG/Monographs/vol105/index.php].
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(7) Air Toxics
(a) Background
    Heavy-duty vehicle emissions contribute to ambient levels of air 
toxics that are known or suspected human or animal carcinogens, or that 
have noncancer health effects. The population experiences an elevated 
risk of cancer and other noncancer health effects from exposure to the 
class of pollutants known collectively as ``air toxics.'' \610\ These 
compounds include, but are not limited to, benzene, 1,3-butadiene, 
formaldehyde, acetaldehyde, acrolein, polycyclic organic matter, and 
naphthalene. These compounds were identified as national or regional 
risk drivers or contributors in the 2011 National-scale Air Toxics 
Assessment and have significant inventory contributions from mobile 
sources.\611\
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    \610\ U.S. EPA. (2015) Summary of Results for the 2011 National-
Scale Assessment. http://www3.epa.gov/sites/production/files/2015-12/documents/2011-nata-summary-results.pdf.
    \611\ U.S. EPA (2015) 2011 National Air Toxics Assessment. 
http://www3.epa.gov/national-air-toxics-assessment/2011-national-air-toxics-assessment.
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(b) Benzene
    EPA's Integrated Risk Information System (IRIS) database lists 
benzene as a known human carcinogen (causing leukemia) by all routes of 
exposure, and concludes that exposure is associated with additional 
health effects, including genetic changes in both humans and animals 
and increased proliferation of bone marrow cells in 
mice.612 613 614 EPA states in its IRIS database that data 
indicate a causal relationship between benzene exposure and acute 
lymphocytic leukemia and suggest a relationship between benzene 
exposure and chronic non-lymphocytic leukemia and chronic lymphocytic 
leukemia. EPA's IRIS documentation for benzene also lists a range of 
2.2 x 10-6 to 7.8 x 10-6 per [mu]g/m\3\ as the 
unit risk estimate (URE) for benzene.615 616 The 
International Agency for Research on Cancer (IARC) has determined that 
benzene is a human carcinogen and the U.S. Department of Health and 
Human Services (DHHS) has characterized benzene as a known human 
carcinogen.617 618
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    \612\ U.S. EPA. (2000). Integrated Risk Information System File 
for Benzene. This material is available electronically at: http://www3.epa.gov/iris/subst/0276.htm.
    \613\ International Agency for Research on Cancer, IARC 
monographs on the evaluation of carcinogenic risk of chemicals to 
humans, Volume 29, some industrial chemicals and dyestuffs, 
International Agency for Research on Cancer, World Health 
Organization, Lyon, France 1982.
    \614\ Irons, R.D.; Stillman, W.S.; Colagiovanni, D.B.; Henry, 
V.A. (1992). Synergistic action of the benzene metabolite 
hydroquinone on myelopoietic stimulating activity of granulocyte/
macrophage colony-stimulating factor in vitro, Proc. Natl. Acad. 
Sci. 89:3691-3695.
    \615\ A unit risk estimate is defined as the increase in the 
lifetime risk of an individual who is exposed for a lifetime to 1 
[mu]g/m3 benzene in air.
    \616\ U.S. EPA. (2000). Integrated Risk Information System File 
for Benzene. This material is available electronically at: http://www3.epa.gov/iris/subst/0276.htm.
    \617\ International Agency for Research on Cancer (IARC). 
(1987). Monographs on the evaluation of carcinogenic risk of 
chemicals to humans, Volume 29, Supplement 7, Some industrial 
chemicals and dyestuffs, World Health Organization, Lyon, France.
    \618\ NTP. (2014). 13th Report on Carcinogens. Research Triangle 
Park, NC: U.S. Department of Health and Human Services, Public 
Health Service, National Toxicology Program.
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    A number of adverse noncancer health effects including blood 
disorders, such as pre- leukemia and aplastic anemia, have also been 
associated with long-term exposure to benzene.619 620 The 
most sensitive noncancer effect observed in humans, based on current 
data, is the depression of the absolute lymphocyte count in 
blood.621 622 EPA's inhalation reference concentration (RfC) 
for benzene is 30 [mu]g/m\3\. The RfC is based on suppressed absolute 
lymphocyte counts seen in humans under occupational exposure 
conditions. In addition, recent work, including studies sponsored by 
the Health Effects Institute, provides evidence that biochemical 
responses are occurring at lower levels of benzene exposure than 
previously known.623 624 625 626 EPA's IRIS program has not 
yet evaluated these new data. EPA does not currently have an acute 
reference concentration for benzene. The Agency for Toxic Substances 
and Disease Registry (ATSDR) Minimal Risk Level (MRL) for acute 
exposure to benzene is 29 [mu]g/m\3\ for 1-14 days 
exposure.627 628
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    \619\ Aksoy, M. (1989). Hematotoxicity and carcinogenicity of 
benzene. Environ. Health Perspect. 82: 193-197.
    \620\ Goldstein, B.D. (1988). Benzene toxicity. Occupational 
medicine. State of the Art Reviews. 3: 541-554.
    \621\ Rothman, N., G.L. Li, M. Dosemeci, W.E. Bechtold, G.E. 
Marti, Y.Z. Wang, M. Linet, L.Q. Xi, W. Lu, M.T. Smith, N. Titenko-
Holland, L.P. Zhang, W. Blot, S.N. Yin, and R.B. Hayes. (1996). 
Hematotoxicity among Chinese workers heavily exposed to benzene. Am. 
J. Ind. Med. 29: 236-246.
    \622\ U.S. EPA. (2002). Toxicological Review of Benzene 
(Noncancer Effects). Environmental Protection Agency, Integrated 
Risk Information System (IRIS), Research and Development, National 
Center for Environmental Assessment, Washington DC. This material is 
available electronically at http://www3.epa.gov/iris/subst/0276.htm.
    \623\ Qu, O.; Shore, R.; Li, G.; Jin, X.; Chen, C.L.; Cohen, B.; 
Melikian, A.; Eastmond, D.; Rappaport, S.; Li, H.; Rupa, D.; 
Suramaya, R.; Songnian, W.; Huifant, Y.; Meng, M.; Winnik, M.; Kwok, 
E.; Li, Y.; Mu, R.; Xu, B.; Zhang, X.; Li, K. (2003). HEI Report 
115, Validation & Evaluation of Biomarkers in Workers Exposed to 
Benzene in China.
    \624\ Qu, Q., R. Shore, G. Li, X. Jin, L.C. Chen, B. Cohen, et 
al. (2002). Hematological changes among Chinese workers with a broad 
range of benzene exposures. Am. J. Industr. Med. 42: 275-285.
    \625\ Lan, Qing, Zhang, L., Li, G., Vermeulen, R., et al. 
(2004). Hematotoxically in Workers Exposed to Low Levels of Benzene. 
Science 306: 1774-1776.
    \626\ Turtletaub, K.W. and Mani, C. (2003). Benzene metabolism 
in rodents at doses relevant to human exposure from Urban Air. 
Research Reports Health Effect Inst. Report No.113.
    \627\ U.S. Agency for Toxic Substances and Disease Registry 
(ATSDR). (2007). Toxicological profile for benzene. Atlanta, GA: 
U.S. Department of Health and Human Services, Public Health Service. 
http://www.atsdr.cdc.gov/ToxProfiles/tp3.pdf.
    \628\ A minimal risk level (MRL) is defined as an estimate of 
the daily human exposure to a hazardous substance that is likely to 
be without appreciable risk of adverse noncancer health effects over 
a specified duration of exposure.

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[[Page 73842]]

(c) 1,3-Butadiene
    EPA has characterized 1,3-butadiene as carcinogenic to humans by 
inhalation.629 630 The IARC has determined that 1,3-
butadiene is a human carcinogen and the U.S. DHHS has characterized 
1,3-butadiene as a known human carcinogen.631 632 633 There 
are numerous studies consistently demonstrating that 1,3-butadiene is 
metabolized into genotoxic metabolites by experimental animals and 
humans. The specific mechanisms of 1,3-butadiene-induced carcinogenesis 
are unknown; however, the scientific evidence strongly suggests that 
the carcinogenic effects are mediated by genotoxic metabolites. Animal 
data suggest that females may be more sensitive than males for cancer 
effects associated with 1,3-butadiene exposure; there are insufficient 
data in humans from which to draw conclusions about sensitive 
subpopulations. The URE for 1,3-butadiene is 3 x 10-5 per 
[mu]g/m\3\.\634\ 1,3-butadiene also causes a variety of reproductive 
and developmental effects in mice; no human data on these effects are 
available. The most sensitive effect was ovarian atrophy observed in a 
lifetime bioassay of female mice.\635\ Based on this critical effect 
and the benchmark concentration methodology, an RfC for chronic health 
effects was calculated at 0.9 ppb (approximately 2 [mu]g/m\3\).
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    \629\ U.S. EPA. (2002). Health Assessment of 1,3-Butadiene. 
Office of Research and Development, National Center for 
Environmental Assessment, Washington Office, Washington, DC. Report 
No. EPA600-P-98-001F. This document is available electronically at 
http://www3.epa.gov/iris/supdocs/buta-sup.pdf.
    \630\ U.S. EPA. (2002). ``Full IRIS Summary for 1,3-butadiene 
(CASRN 106-99-0)'' Environmental Protection Agency, Integrated Risk 
Information System (IRIS), Research and Development, National Center 
for Environmental Assessment, Washington, DC http://www3.epa.gov/iris/subst/0139.htm.
    \631\ International Agency for Research on Cancer (IARC). 
(1999). Monographs on the evaluation of carcinogenic risk of 
chemicals to humans, Volume 71, Re-evaluation of some organic 
chemicals, hydrazine and hydrogen peroxide and Volume 97 (in 
preparation), World Health Organization, Lyon, France.
    \632\ International Agency for Research on Cancer (IARC). 
(2008). Monographs on the evaluation of carcinogenic risk of 
chemicals to humans, 1,3-Butadiene, Ethylene Oxide and Vinyl Halides 
(Vinyl Fluoride, Vinyl Chloride and Vinyl Bromide) Volume 97, World 
Health Organization, Lyon, France.
    \633\ NTP. (2014). 13th Report on Carcinogens. Research Triangle 
Park, NC: U.S. Department of Health and Human Services, Public 
Health Service, National Toxicology Program.
    \634\ U.S. EPA. (2002). ``Full IRIS Summary for 1,3-butadiene 
(CASRN 106-99-0)'' Environmental Protection Agency, Integrated Risk 
Information System (IRIS), Research and Development, National Center 
for Environmental Assessment, Washington, DC http://www3.epa.gov/iris/subst/0139.htm.
    \635\ Bevan, C.; Stadler, J.C.; Elliot, G.S.; et al. (1996). 
Subchronic toxicity of 4-vinylcyclohexene in rats and mice by 
inhalation. Fundam. Appl. Toxicol. 32:1-10.
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(d) Formaldehyde
    In 1991, EPA concluded that formaldehyde is a carcinogen based on 
nasal tumors in animal bioassays.\636\ An Inhalation URE for cancer and 
a Reference Dose for oral noncancer effects were developed by the 
agency and posted on the IRIS database. Since that time, the National 
Toxicology Program (NTP) and International Agency for Research on 
Cancer (IARC) have concluded that formaldehyde is a known human 
carcinogen.637 638
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    \636\ EPA. Integrated Risk Information System. Formaldehyde 
(CASRN 50-00-0) http://www3.epa.gov/iris/subst/0419/htm.
    \637\ NTP. (2014). 13th Report on Carcinogens. Research Triangle 
Park, NC: U.S. Department of Health and Human Services, Public 
Health Service, National Toxicology Program.
    \638\ IARC Monographs on the Evaluation of Carcinogenic Risks to 
Humans Volume 100F (2012): Formaldehyde.
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    The conclusions by IARC and NTP reflect the results of 
epidemiologic research published since 1991 in combination with 
previous animal, human and mechanistic evidence. Research conducted by 
the National Cancer Institute reported an increased risk of 
nasopharyngeal cancer and specific lymph hematopoietic malignancies 
among workers exposed to formaldehyde.639 640 641 A National 
Institute of Occupational Safety and Health study of garment workers 
also reported increased risk of death due to leukemia among workers 
exposed to formaldehyde.\642\ Extended follow-up of a cohort of British 
chemical workers did not report evidence of an increase in 
nasopharyngeal or lymph hematopoietic cancers, but a continuing 
statistically significant excess in lung cancers was reported.\643\ 
Finally, a study of embalmers reported formaldehyde exposures to be 
associated with an increased risk of myeloid leukemia but not brain 
cancer.\644\
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    \639\ Hauptmann, M.; Lubin, J. H.; Stewart, P. A.; Hayes, R. B.; 
Blair, A. 2003. Mortality from lymphohematopoetic malignancies among 
workers in formaldehyde industries. Journal of the National Cancer 
Institute 95: 1615-1623.
    \640\ Hauptmann, M.; Lubin, J. H.; Stewart, P. A.; Hayes, R. B.; 
Blair, A. 2004. Mortality from solid cancers among workers in 
formaldehyde industries. American Journal of Epidemiology 159: 1117-
1130.
    \641\ Beane Freeman, L. E.; Blair, A.; Lubin, J. H.; Stewart, P. 
A.; Hayes, R. B.; Hoover, R. N.; Hauptmann, M. 2009. Mortality from 
lymph hematopoietic malignancies among workers in formaldehyde 
industries: The National Cancer Institute cohort. J. National Cancer 
Inst. 101: 751-761.
    \642\ Pinkerton, L. E. 2004. Mortality among a cohort of garment 
workers exposed to formaldehyde: an update. Occup. Environ. Med. 61: 
193-200.
    \643\ Coggon, D, EC Harris, J Poole, KT Palmer. 2003. Extended 
follow-up of a cohort of British chemical workers exposed to 
formaldehyde. J National Cancer Inst. 95:1608-1615.
    \644\ Hauptmann, M,; Stewart P. A.; Lubin J. H.; Beane Freeman, 
L. E.; Hornung, R. W.; Herrick, R. F.; Hoover, R. N.; Fraumeni, J. 
F.; Hayes, R. B. 2009. Mortality from lymph hematopoietic 
malignancies and brain cancer among embalmers exposed to 
formaldehyde. Journal of the National Cancer Institute 101:1696-
1708.
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    Health effects of formaldehyde in addition to cancer were reviewed 
by the Agency for Toxics Substances and Disease Registry in 1999 \645\, 
supplemented in 2010,\646\ and by the World Health Organization.\647\ 
These organizations reviewed the scientific literature concerning 
health effects linked to formaldehyde exposure to evaluate hazards and 
dose response relationships and defined exposure concentrations for 
minimal risk levels (MRLs). The health endpoints reviewed included 
sensory irritation of eyes and respiratory tract, reduced pulmonary 
function, nasal histopathology, and immune system effects. In addition, 
research on reproductive and developmental effects and neurological 
effects were discussed along with several studies that suggest that 
formaldehyde may increase the risk of asthma--particularly in the 
young.
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    \645\ ATSDR. 1999. Toxicological Profile for Formaldehyde, U.S. 
Department of Health and Human Services (HHS), July 1999.
    \646\ ATSDR. 2010. Addendum to the Toxicological Profile for 
Formaldehyde. U.S. Department of Health and Human Services (HHS), 
October 2010.
    \647\ IPCS. 2002. Concise International Chemical Assessment 
Document 40. Formaldehyde. World Health Organization.
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    EPA released a draft Toxicological Review of Formaldehyde--
Inhalation Assessment through the IRIS program for peer review by the 
National Research Council (NRC) and public comment in June 2010.\648\ 
The draft assessment reviewed more recent research from animal and 
human studies on cancer and other health effects. The NRC released 
their review report in April 2011.\649\ EPA is currently developing a 
revised draft assessment in response to this review.
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    \648\ EPA (U.S. Environmental Protection Agency). 2010. 
Toxicological Review of Formaldehyde (CAS No. 50-00-0)--Inhalation 
Assessment: In Support of Summary Information on the Integrated Risk 
Information System (IRIS). External Review Draft. EPA/635/R-10/002A. 
U.S. Environmental Protection Agency, Washington DC [online]. 
Available: http://cfpub.epa.gov/ncea/irs_drats/recordisplay.cfm?deid=223614.
    \649\ NRC (National Research Council). 2011. Review of the 
Environmental Protection Agency's Draft IRIS Assessment of 
Formaldehyde. Washington DC: National Academies Press. http://books.nap.edu/openbook.php?record_id=13142.

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[[Page 73843]]

(e) Acetaldehyde
    Acetaldehyde is classified in EPA's IRIS database as a probable 
human carcinogen, based on nasal tumors in rats, and is considered 
toxic by the inhalation, oral, and intravenous routes.\650\ The URE in 
IRIS for acetaldehyde is 2.2 x 10-6 per [mu]g/m\3\.\651\ 
Acetaldehyde is reasonably anticipated to be a human carcinogen by the 
U.S. DHHS in the 13th Report on Carcinogens and is classified as 
possibly carcinogenic to humans (Group 2B) by the 
IARC.652 653 Acetaldehyde is currently listed on the IRIS 
Program Multi-Year Agenda for reassessment within the next few years.
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    \650\ U.S. EPA (1991). Integrated Risk Information System File 
of Acetaldehyde. Research and Development, National Center for 
Environmental Assessment, Washington, DC. This material is available 
electronically at http://www3.epa.gov/iris/subst/0290.htm.
    \651\ U.S. EPA (1991). Integrated Risk Information System File 
of Acetaldehyde. This material is available electronically at http://www3.epa.gov/iris/subst/0290.htm.
    \652\ NTP. (2014). 13th Report on Carcinogens. Research Triangle 
Park, NC: U.S. Department of Health and Human Services, Public 
Health Service, National Toxicology Program.
    \653\ International Agency for Research on Cancer (IARC). 
(1999). Re-evaluation of some organic chemicals, hydrazine, and 
hydrogen peroxide. IARC Monographs on the Evaluation of Carcinogenic 
Risk of Chemical to Humans, Vol 71. Lyon, France.
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    The primary noncancer effects of exposure to acetaldehyde vapors 
include irritation of the eyes, skin, and respiratory tract.\654\ In 
short-term (4 week) rat studies, degeneration of olfactory epithelium 
was observed at various concentration levels of acetaldehyde 
exposure.655 656 Data from these studies were used by EPA to 
develop an inhalation reference concentration of 9 [mu]g/m\3\. Some 
asthmatics have been shown to be a sensitive subpopulation to 
decrements in functional expiratory volume (FEV1 test) and 
bronchoconstriction upon acetaldehyde inhalation.\657\
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    \654\ U.S. EPA (1991). Integrated Risk Information System File 
of Acetaldehyde. This material is available electronically at http://www3.epa.gov/iris/subst/0290.htm.
    \655\ U.S. EPA. (2003). Integrated Risk Information System File 
of Acrolein. Research and Development, National Center for 
Environmental Assessment, Washington, DC. This material is available 
electronically at http://www3.epa.gov/iris/subst/0364.htm.
    \656\ Appleman, L.M., R.A. Woutersen, and V.J. Feron. (1982). 
Inhalation toxicity of acetaldehyde in rats. I. Acute and subacute 
studies. Toxicology. 23: 293-297.
    \657\ Myou, S.; Fujimura, M.; Nishi K.; Ohka, T.; and Matsuda, 
T. (1993) Aerosolized acetaldehyde induces histamine-mediated 
bronchoconstriction in asthmatics. Am. Rev. Respir. Dis. 148(4 Pt 
1): 940-943.
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(f) Acrolein
    EPA most recently evaluated the toxicological and health effects 
literature related to acrolein in 2003 and concluded that the human 
carcinogenic potential of acrolein could not be determined because the 
available data were inadequate. No information was available on the 
carcinogenic effects of acrolein in humans and the animal data provided 
inadequate evidence of carcinogenicity.\658\ The IARC determined in 
1995 that acrolein was not classifiable as to its carcinogenicity in 
humans.\659\
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    \658\ U.S. EPA. (2003). Integrated Risk Information System File 
of Acrolein. Research and Development, National Center for 
Environmental Assessment, Washington, DC. This material is available 
at http://www3.epa.gov/iris/subst/0364.htm.
    \659\ International Agency for Research on Cancer (IARC). 
(1995). Monographs on the evaluation of carcinogenic risk of 
chemicals to humans, Volume 63. Dry cleaning, some chlorinated 
solvents and other industrial chemicals, World Health Organization, 
Lyon, France.
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    Lesions to the lungs and upper respiratory tract of rats, rabbits, 
and hamsters have been observed after subchronic exposure to 
acrolein.\660\ The agency has developed an RfC for acrolein of 0.02 
[mu]g/m\3\ and an RfD of 0.5 [mu]g/kg-day.\661\
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    \660\ U.S. EPA. (2003). Integrated Risk Information System File 
of Acrolein. Office of Research and Development, National Center for 
Environmental Assessment, Washington, DC. This material is available 
at http://www3.epa.gov/iris/subst/0364.htm.
    \661\ U.S. EPA. (2003). Integrated Risk Information System File 
of Acrolein. Office of Research and Development, National Center for 
Environmental Assessment, Washington, DC. This material is available 
at http://www3.epa.gov/iris/subst/0364.htm.
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    Acrolein is extremely acrid and irritating to humans when inhaled, 
with acute exposure resulting in upper respiratory tract irritation, 
mucus hypersecretion and congestion. The intense irritancy of this 
carbonyl has been demonstrated during controlled tests in human 
subjects, who suffer intolerable eye and nasal mucosal sensory 
reactions within minutes of exposure.\662\ These data and additional 
studies regarding acute effects of human exposure to acrolein are 
summarized in EPA's 2003 Toxicological Review of Acrolein.\663\ Studies 
in humans indicate that levels as low as 0.09 ppm (0.21 mg/m\3\) for 
five minutes may elicit subjective complaints of eye irritation with 
increasing concentrations leading to more extensive eye, nose and 
respiratory symptoms. Acute exposures in animal studies report 
bronchial hyper-responsiveness. Based on animal data (more pronounced 
respiratory irritancy in mice with allergic airway disease in 
comparison to non-diseased mice) \664\ and demonstration of similar 
effects in humans (e.g., reduction in respiratory rate), individuals 
with compromised respiratory function (e.g., emphysema, asthma) are 
expected to be at increased risk of developing adverse responses to 
strong respiratory irritants such as acrolein. EPA does not currently 
have an acute reference concentration for acrolein. The available 
health effect reference values for acrolein have been summarized by EPA 
and include an ATSDR MRL for acute exposure to acrolein of 7 [mu]g/m\3\ 
for 1-14 days exposure; and Reference Exposure Level (REL) values from 
the California Office of Environmental Health Hazard Assessment (OEHHA) 
for one-hour and 8-hour exposures of 2.5 [mu]g/m\3\ and 0.7 [mu]g/m\3\, 
respectively.\665\
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    \662\ U.S. EPA. (2003) Toxicological review of acrolein in 
support of summary information on Integrated Risk Information System 
(IRIS) National Center for Environmental Assessment, Washington, DC. 
EPA/635/R-03/003. p. 10. Available online at: http://www3.epa.gov/ncea/iris/toxreviews/0364tr.pdf.
    \663\ U.S. EPA. (2003) Toxicological review of acrolein in 
support of summary information on Integrated Risk Information System 
(IRIS) National Center for Environmental Assessment, Washington, DC. 
EPA/635/R-03/003. Available online at: http://www3.epa.gov/ncea/iris/toxreviews/0364tr.pdf.
    \664\ Morris JB, Symanowicz PT, Olsen JE, et al. (2003). 
Immediate sensory nerve-mediated respiratory responses to irritants 
in healthy and allergic airway-diseased mice. J Appl Physiol 
94(4):1563-1571.
    \665\ U.S. EPA. (2009). Graphical Arrays of Chemical-Specific 
Health Effect Reference Values for Inhalation Exposures (Final 
Report). U.S. Environmental Protection Agency, Washington, DC, EPA/
600/R-09/061, 2009. http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=211003.
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(g) Polycyclic Organic Matter
    The term polycyclic organic matter (POM) defines a broad class of 
compounds that includes the polycyclic aromatic hydrocarbon compounds 
(PAHs). One of these compounds, naphthalene, is discussed separately 
below. POM compounds are formed primarily from combustion and are 
present in the atmosphere in gas and particulate form. Cancer is the 
major concern from exposure to POM. Epidemiologic studies have reported 
an increase in lung cancer in humans exposed to diesel exhaust, coke 
oven emissions, roofing tar emissions, and cigarette smoke; all of 
these mixtures contain POM compounds.666 667 Animal studies 
have reported respiratory tract tumors from inhalation exposure to

[[Page 73844]]

benzo[a]pyrene and alimentary tract and liver tumors from oral exposure 
to benzo[a]pyrene.\668\ In 1997 EPA classified seven PAHs 
(benzo[a]pyrene, benz[a]anthracene, chrysene, benzo[b]fluoranthene, 
benzo[k]fluoranthene, dibenz[a,h]anthracene, and indeno[1,2,3-
cd]pyrene) as Group B2, probable human carcinogens.\669\ Since that 
time, studies have found that maternal exposures to PAHs in a 
population of pregnant women were associated with several adverse birth 
outcomes, including low birth weight and reduced length at birth, as 
well as impaired cognitive development in preschool children (3 years 
of age).670 671 These and similar studies are being 
evaluated as a part of the ongoing IRIS reassessment of health effects 
associated with exposure to benzo[a]pyrene.
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    \666\ Agency for Toxic Substances and Disease Registry (ATSDR). 
(1995). Toxicological profile for Polycyclic Aromatic Hydrocarbons 
(PAHs). Atlanta, GA: U.S. Department of Health and Human Services, 
Public Health Service. Available electronically at http://www.atsdr.cdc.gov/ToxProfiles/TP.asp?id=122&tid=25.
    \667\ U.S. EPA (2002). Health Assessment Document for Diesel 
Engine Exhaust. EPA/600/8-90/057F Office of Research and 
Development, Washington DC. http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=29060.
    \668\ International Agency for Research on Cancer (IARC). 
(2012). Monographs on the Evaluation of the Carcinogenic Risk of 
Chemicals for Humans, Chemical Agents and Related Occupations. Vol. 
100F. Lyon, France.
    \669\ U.S. EPA (1997). Integrated Risk Information System File 
of indeno (1,2,3-cd) pyrene. Research and Development, National 
Center for Environmental Assessment, Washington, DC. This material 
is available electronically at http://www3.epa.gov/ncea/iris/subst/0457.htm.
    \670\ Perera, F.P.; Rauh, V.; Tsai, W-Y.; et al. (2002). Effect 
of transplacental exposure to environmental pollutants on birth 
outcomes in a multiethnic population. Environ Health Perspect. 111: 
201-205.
    \671\ Perera, F.P.; Rauh, V.; Whyatt, R.M.; Tsai, W.Y.; Tang, 
D.; Diaz, D.; Hoepner, L.; Barr, D.; Tu, Y.H.; Camann, D.; Kinney, 
P. (2006). Effect of prenatal exposure to airborne polycyclic 
aromatic hydrocarbons on neurodevelopment in the first 3 years of 
life among inner-city children. Environ Health Perspect 114: 1287-
1292.
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(h) Naphthalene
    Naphthalene is found in small quantities in gasoline and diesel 
fuels. Naphthalene emissions have been measured in larger quantities in 
both gasoline and diesel exhaust compared with evaporative emissions 
from mobile sources, indicating it is primarily a product of 
combustion. Acute (short-term) exposure of humans to naphthalene by 
inhalation, ingestion, or dermal contact is associated with hemolytic 
anemia and damage to the liver and the nervous system.\672\ Chronic 
(long term) exposure of workers and rodents to naphthalene has been 
reported to cause cataracts and retinal damage.\673\ EPA released an 
external review draft of a reassessment of the inhalation 
carcinogenicity of naphthalene based on a number of recent animal 
carcinogenicity studies.\674\ The draft reassessment completed external 
peer review.\675\ Based on external peer review comments received, a 
revised draft assessment that considers all routes of exposure, as well 
as cancer and noncancer effects, is under development. The external 
review draft does not represent official agency opinion and was 
released solely for the purposes of external peer review and public 
comment. The National Toxicology Program listed naphthalene as 
``reasonably anticipated to be a human carcinogen'' in 2004 on the 
basis of bioassays reporting clear evidence of carcinogenicity in rats 
and some evidence of carcinogenicity in mice.\676\ California EPA has 
released a new risk assessment for naphthalene, and the IARC has 
reevaluated naphthalene and re-classified it as Group 2B: possibly 
carcinogenic to humans.\677\
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    \672\ U. S. EPA. 1998. Toxicological Review of Naphthalene 
(Reassessment of the Inhalation Cancer Risk), Environmental 
Protection Agency, Integrated Risk Information System, Research and 
Development, National Center for Environmental Assessment, 
Washington, DC. This material is available electronically at http://www3.epa.gov/iris/subst/0436.htm.
    \673\ U. S. EPA. 1998. Toxicological Review of Naphthalene 
(Reassessment of the Inhalation Cancer Risk), Environmental 
Protection Agency, Integrated Risk Information System, Research and 
Development, National Center for Environmental Assessment, 
Washington, DC. This material is available electronically at http://www3.epa.gov/iris/subst/0436.htm.
    \674\ U. S. EPA. (1998). Toxicological Review of Naphthalene 
(Reassessment of the Inhalation Cancer Risk), Environmental 
Protection Agency, Integrated Risk Information System, Research and 
Development, National Center for Environmental Assessment, 
Washington, DC. This material is available electronically at http://www3.epa.gov/iris/subst/0436.htm.
    \675\ Oak Ridge Institute for Science and Education. (2004). 
External Peer Review for the IRIS Reassessment of the Inhalation 
Carcinogenicity of Naphthalene. August 2004. http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=84403.
    \676\ NTP. (2014). 13th Report on Carcinogens. U.S. Department 
of Health and Human Services, Public Health Service, National 
Toxicology Program.
    \677\ International Agency for Research on Cancer (IARC). 
(2002). Monographs on the Evaluation of the Carcinogenic Risk of 
Chemicals for Humans. Vol. 82. Lyon, France.
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    Naphthalene also causes a number of chronic non-cancer effects in 
animals, including abnormal cell changes and growth in respiratory and 
nasal tissues.\678\ The current EPA IRIS assessment includes noncancer 
data on hyperplasia and metaplasia in nasal tissue that form the basis 
of the inhalation RfC of 3 [mu]g/m\3\.\679\ The ATSDR MRL for acute 
exposure to naphthalene is 0.6 mg/kg/day.
---------------------------------------------------------------------------

    \678\ U. S. EPA. (1998). Toxicological Review of Naphthalene, 
Environmental Protection Agency, Integrated Risk Information System, 
Research and Development, National Center for Environmental 
Assessment, Washington, DC. This material is available 
electronically at http://www3.epa.gov/iris/subst/0436.htm.
    \679\ U.S. EPA. (1998). Toxicological Review of Naphthalene. 
Environmental Protection Agency, Integrated Risk Information System 
(IRIS), Research and Development, National Center for Environmental 
Assessment, Washington, DC http://www3.epa.gov/iris/subst/0436.htm.
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(i) Other Air Toxics
    In addition to the compounds described above, other compounds in 
gaseous hydrocarbon and PM emissions from motor vehicles will be 
affected by this action. Mobile source air toxic compounds that will 
potentially be impacted include ethylbenzene, propionaldehyde, toluene, 
and xylene. Information regarding the health effects of these compounds 
can be found in EPA's IRIS database.\680\
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    \680\ U.S. EPA Integrated Risk Information System (IRIS) 
database is available at: www3.epa.gov/iris.
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(8) Exposure and Health Effects Associated With Traffic
    Locations in close proximity to major roadways generally have 
elevated concentrations of many air pollutants emitted from motor 
vehicles. Hundreds of such studies have been published in peer-reviewed 
journals, concluding that concentrations of CO, NO, NO2, 
benzene, aldehydes, particulate matter, black carbon, and many other 
compounds are elevated in ambient air within approximately 300-600 
meters (about 1,000-2,000 feet) of major roadways. Highest 
concentrations of most pollutants emitted directly by motor vehicles 
are found at locations within 50 meters (about 165 feet) of the edge of 
a roadway's traffic lanes.
    A large-scale review of air quality measurements in the vicinity of 
major roadways between 1978 and 2008 concluded that the pollutants with 
the steepest concentration gradients in vicinities of roadways were CO, 
ultrafine particles, metals, elemental carbon (EC), NO, NOX, 
and several VOCs.\681\ These pollutants showed a large reduction in 
concentrations within 100 meters downwind of the roadway. Pollutants 
that showed more gradual reductions with distance from roadways 
included benzene, NO2, PM2.5, and 
PM10. In the review article, results varied based on the 
method of statistical analysis used to determine the trend.
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    \681\ Karner, A.A.; Eisinger, D.S.; Niemeier, D.A. (2010). Near-
roadway air quality: synthesizing the findings from real-world data. 
Environ Sci Technol 44: 5334-5344.
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    For pollutants with relatively high background concentrations 
relative to near-road concentrations, detecting concentration gradients 
can be difficult. For example, many aldehydes have high background 
concentrations as a result of photochemical breakdown of precursors 
from many different organic compounds. This can make detection of 
gradients around roadways and other primary emission sources difficult.

[[Page 73845]]

However, several studies have measured aldehydes in multiple weather 
conditions and found higher concentrations of many carbonyls downwind 
of roadways.682 683 These findings suggest a substantial 
roadway source of these carbonyls.
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    \682\ Liu, W.; Zhang, J.; Kwon, J.L.; et al. (2006). 
Concentrations and source characteristics of airborne carbonyl 
comlbs measured outside urban residences. J Air Waste Manage Assoc 
56: 1196-1204.
    \683\ Cahill, T.M.; Charles, M.J.; Seaman, V.Y. (2010). 
Development and application of a sensitive method to determine 
concentrations of acrolein and other carbonyls in ambient air. 
Health Effects Institute Research Report 149.Available at http://dx.doi.org.
---------------------------------------------------------------------------

    In the past 15 years, many studies have been published with results 
reporting that populations who live, work, or go to school near high-
traffic roadways experience higher rates of numerous adverse health 
effects, compared to populations far away from major roads.\684\ In 
addition, numerous studies have found adverse health effects associated 
with spending time in traffic, such as commuting or walking along high-
traffic roadways.685 686 687 688 The health outcomes with 
the strongest evidence linking them with traffic-associated air 
pollutants are respiratory effects, particularly in asthmatic children, 
and cardiovascular effects.
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    \684\ In the widely-used PubMed database of health publications, 
between January 1, 1990 and August 18, 2011, 605 publications 
contained the keywords ``traffic, pollution, epidemiology,'' with 
approximately half the studies published after 2007.
    \685\ Laden, F.; Hart, J.E.; Smith, T.J.; Davis, M.E.; Garshick, 
E. (2007) Cause-specific mortality in the unionized U.S. trucking 
industry. Environmental Health Perspect 115:1192-1196.
    \686\ Peters, A.; von Klot, S.; Heier, M.; Trentinaglia, I.; 
H[ouml]rmann, A.; Wichmann, H.E.; L[ouml]wel, H. (2004) Exposure to 
traffic and the onset of myocardial infarction. New England J Med 
351: 1721-1730.
    \687\ Zanobetti, A.; Stone, P.H.; Spelzer, F.E.; Schwartz, J.D.; 
Coull, B.A.; Suh, H.H.; Nearling, B.D.; Mittleman, M.A.; Verrier, 
R.L.; Gold, D.R. (2009) T-wave alternans, air pollution and traffic 
in high-risk subjects. Am J Cardiol 104: 665-670.
    \688\ Dubowsky Adar, S.; Adamkiewicz, G.; Gold, D.R.; Schwartz, 
J.; Coull, B.A.; Suh, H. (2007) Ambient and microenvironmental 
particles and exhaled nitric oxide before and after a group bus 
trip. Environ Health Perspect 115: 507-512.
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    Numerous reviews of this body of health literature have been 
published as well. In 2010, an expert panel of the Health Effects 
Institute (HEI) published a review of hundreds of exposure, 
epidemiology, and toxicology studies.\689\ The panel rated how the 
evidence for each type of health outcome supported a conclusion of a 
causal association with traffic-associated air pollution as either 
``sufficient,'' ``suggestive but not sufficient,'' or ``inadequate and 
insufficient.'' The panel categorized evidence of a causal association 
for exacerbation of childhood asthma as ``sufficient.'' The panel 
categorized evidence of a causal association for new onset asthma as 
between ``sufficient'' and ``suggestive but not sufficient.'' 
``Suggestive of a causal association'' was how the panel categorized 
evidence linking traffic-associated air pollutants with exacerbation of 
adult respiratory symptoms and lung function decrement. It categorized 
as ``inadequate and insufficient'' evidence of a causal relationship 
between traffic-related air pollution and health care utilization for 
respiratory problems, new onset adult asthma, chronic obstructive 
pulmonary disease (COPD), nonasthmatic respiratory allergy, and cancer 
in adults and children. Other literature reviews have been published 
with conclusions generally similar to the HEI 
panel's.690 691 692 693 However, in 2014, researchers from 
the U.S. Centers for Disease Control and Prevention (CDC) published a 
systematic review and meta-analysis of studies evaluating the risk of 
childhood leukemia associated with traffic exposure and reported 
positive associations between ``postnatal'' proximity to traffic and 
leukemia risks, but no such association for ``prenatal'' 
exposures.\694\
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    \689\ Health Effects Institute Panel on the Health Effects of 
Traffic-Related Air Pollution. (2010). Traffic-related air 
pollution: a critical review of the literature on emissions, 
exposure, and health effects. HEI Special Report 17. Available at 
http://www.healtheffects.org.
    \690\ Boothe, V.L.; Shendell, D.G. (2008). Potential health 
effects associated with residential proximity to freeways and 
primary roads: review of scientific literature, 1999-2006. J Environ 
Health 70: 33-41.
    \691\ Salam, M.T.; Islam, T.; Gilliland, F.D. (2008). Recent 
evidence for adverse effects of residential proximity to traffic 
sources on asthma. Curr Opin Pulm Med 14: 3-8.
    \692\ Sun, X.; Zhang, S.; Ma, X. (2014) No association between 
traffic density and risk of childhood leukemia: a meta-analysis. 
Asia Pac J Cancer Prev 15: 5229-5232.
    \693\ Raaschou-Nielsen, O.; Reynolds, P. (2006). Air pollution 
and childhood cancer: a review of the epidemiological literature. 
Int J Cancer 118: 2920-9.
    \694\ Boothe, VL.; Boehmer, T.K.; Wendel, A.M.; Yip, F.Y. (2014) 
Residential traffic exposure and childhood leukemia: a systematic 
review and meta-analysis. Am J Prev Med 46: 413-422.
---------------------------------------------------------------------------

    Health outcomes with few publications suggest the possibility of 
other effects still lacking sufficient evidence to draw definitive 
conclusions. Among these outcomes with a small number of positive 
studies are neurological impacts (e.g., autism and reduced cognitive 
function) and reproductive outcomes (e.g., preterm birth, low birth 
weight).695 696 697 698
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    \695\ Volk, H.E.; Hertz-Picciotto, I.; Delwiche, L.; et al. 
(2011). Residential proximity to freeways and autism in the CHARGE 
study. Environ Health Perspect 119: 873-877.
    \696\ Franco-Suglia, S.; Gryparis, A.; Wright, R.O.; et al. 
(2007). Association of black carbon with cognition among children in 
a prospective birth cohort study. Am J Epidemiol. doi: 10.1093/aje/
kwm308. [Online at http://dx.doi.org].
    \697\ Power, M.C.; Weisskopf, M.G.; Alexeef, SE.; et al. (2011). 
Traffic-related air pollution and cognitive function in a cohort of 
older men. Environ Health Perspect 2011: 682-687.
    \698\ Wu, J.; Wilhelm, M.; Chung, J.; et al. (2011). Comparing 
exposure assessment methods for traffic-related air pollution in and 
adverse pregnancy outcome study. Environ Res 111: 685-6692.
---------------------------------------------------------------------------

    In addition to health outcomes, particularly cardiopulmonary 
effects, conclusions of numerous studies suggest mechanisms by which 
traffic-related air pollution affects health. Numerous studies indicate 
that near-roadway exposures may increase systemic inflammation, 
affecting organ systems, including blood vessels and 
lungs.699 700 701 702 Long-term exposures in near-road 
environments have been associated with inflammation-associated 
conditions, such as atherosclerosis and asthma.\703\ \704\ \705\
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    \699\ Riediker, M. (2007). Cardiovascular effects of fine 
particulate matter components in highway patrol officers. Inhal 
Toxicol 19: 99-105. doi: 10.1080/08958370701495238 Available at 
http://dx.doi.org.
    \700\ Alexeef, SE.; Coull, B.A.; Gryparis, A.; et al. (2011). 
Medium-term exposure to traffic-related air pollution and markers of 
inflammation and endothelial function. Environ Health Perspect 119: 
481-486. doi:10.1289/ehp.1002560 Available at http://dx.doi.org.
    \701\ Eckel. S.P.; Berhane, K.; Salam, M.T.; et al. (2011). 
Traffic-related pollution exposure and exhaled nitric oxide in the 
Children's Health Study. Environ Health Perspect (IN PRESS). 
doi:10.1289/ehp.1103516. Available at http://dx.doi.org.
    \702\ Zhang, J.; McCreanor, J.E.; Cullinan, P.; et al. (2009). 
Health effects of real-world exposure diesel exhaust in persons with 
asthma. Res Rep Health Effects Inst 138. [Online at http://www.healtheffects.org].
    \703\ Adar, S.D.; Klein, R.; Klein, E.K.; et al. (2010). Air 
pollution and the microvasculatory: a cross-sectional assessment of 
in vivo retinal images in the population-based Multi-Ethnic Study of 
Atherosclerosis. PLoS Med 7(11): E1000372. doi:10.1371/
journal.pmed.1000372. Available at http://dx.doi.org.
    \704\ Kan, H.; Heiss, G.; Rose, K.M.; et al. (2008). Prospective 
analysis of traffic exposure as a risk factor for incident coronary 
heart disease: the Atherosclerosis Risk in Communities (ARIC) study. 
Environ Health Perspect 116: 1463-1468. doi:10.1289/ehp.11290. 
Available at http://dx.doi.org.
    \705\ McConnell, R.; Islam, T.; Shankardass, K.; et al. (2010). 
Childhood incident asthma and traffic-related air pollution at home 
and school. Environ Health Perspect 1021-1026.
---------------------------------------------------------------------------

    Several studies suggest that some factors may increase 
susceptibility to the effects of traffic-associated air pollution. 
Several studies have found stronger respiratory associations in 
children experiencing chronic social stress, such as in violent 
neighborhoods or in homes with high family 
stress.706 707 708
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    \706\ Islam, T.; Urban, R.; Gauderman, W.J.; et al. (2011). 
Parental stress increases the detrimental effect of traffic exposure 
on children's lung function. Am J Respir Crit Care Med (In press).
    \707\ Clougherty, J.E.; Levy, J.I.; Kubzansky, L.D.; et al. 
(2007). Synergistic effects of traffic-related air pollution and 
exposure to violence on urban asthma etiology. Environ Health 
Perspect 115: 1140-1146.
    \708\ Chen, E.; Schrier, H.M.; Strunk, R.C.; et al. (2008). 
Chronic traffic-related air pollution and stress interact to predict 
biologic and clinical outcomes in asthma. Environ Health Perspect 
116: 970-5.

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[[Page 73846]]

    The risks associated with residence, workplace, or schools near 
major roads are of potentially high public health significance due to 
the large population in such locations. According to the 2009 American 
Housing Survey, over 22 million homes (17.0 percent of all U.S. housing 
units) were located within 300 feet of an airport, railroad, or highway 
with four or more lanes. This corresponds to a population of more than 
50 million U.S. residents in close proximity to high-traffic roadways 
or other transportation sources. Based on 2010 Census data, a 2013 
publication estimated that 19 percent of the U.S. population (over 59 
million people) lived within 500 meters of roads with at least 25,000 
annual average daily traffic (AADT), while about 3.2 percent of the 
population lived within 100 meters (about 300 feet) of such roads.\709\ 
Another 2013 study estimated that 3.7 percent of the U.S. population 
(about 11.3 million people) lived within 150 meters (about 500 feet) of 
interstate highways or other freeways and expressways.\710\ As 
discussed in Section VIII.A.(9), on average, populations near major 
roads have higher fractions of minority residents and lower 
socioeconomic status. Furthermore, on average, Americans spend more 
than an hour traveling each day, bringing nearly all residents into a 
high-exposure microenvironment for part of the day.
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    \709\ Rowangould, G.M. (2013) A census of the U.S. near-roadway 
population: public health and environmental justice considerations. 
Transportation Research Part D 25: 59-67.
    \710\ Boehmer, T.K.; Foster, S.L.; Henry, J.R.; Woghiren-
Akinnifesi, E.L.; Yip, F.Y. (2013) Residential proximity to major 
highways--United States, 2010. Morbidity and Mortality Weekly Report 
62(3); 46-50.
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    In light of these concerns, EPA has required through the NAAQS 
process that air quality monitors be placed near high-traffic roadways 
for determining concentrations of CO, NO2, and 
PM2.5 (in addition to those existing monitors located in 
neighborhoods and other locations farther away from pollution sources). 
Near-roadway monitors for NO2 begin operation between 2014 
and 2017 in Core Based Statistical Areas (CBSAs) with population of at 
least 500,000. Monitors for CO and PM2.5 begin operation 
between 2015 and 2017. These monitors will further our understanding of 
exposure in these locations.
    EPA and DOT continue to research near-road air quality, including 
the types of pollutants found in high concentrations near major roads 
and health problems associated with the mixture of pollutants near 
roads.
(9) Environmental Justice
    Environmental justice (EJ) is a principle asserting that all people 
deserve fair treatment and meaningful involvement with respect to 
environmental laws, regulations, and policies. EPA seeks to provide the 
same degree of protection from environmental health hazards for all 
people. DOT shares this goal and is informed about the potential 
environmental impacts of its rulemakings through its NEPA process (see 
NHTSA's DEIS). As referenced below, numerous studies have found that 
some environmental hazards are more prevalent in areas where racial/
ethnic minorities and people with low socioeconomic status (SES) 
represent a higher fraction of the population compared with the general 
population. In addition, compared to non-Hispanic whites, some types of 
minorities may have greater levels of health problems during some life 
stages. For example, in 2014, about 13 percent of Black, non-Hispanic 
and 24 percent of Puerto Rican children were estimated to currently 
have asthma, compared with 8 percent of white, non-Hispanic 
children.\711\
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    \711\ http://www.cdc.gov/asthma/most_recent_data.htm.
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    As discussed in Section VIII.A.(8) of this document and NHTSA's 
FEIS, concentrations of many air pollutants are elevated near high-
traffic roadways. If minority populations and low-income populations 
disproportionately live near such roads, then an issue of EJ may be 
present. We reviewed existing scholarly literature examining the 
potential for disproportionate exposure among minorities and people 
with low SES, and we conducted our own evaluation of two national 
datasets: The U.S. Census Bureau's American Housing Survey for calendar 
year 2009 and the U.S. Department of Education's database of school 
locations.
    Publications that address EJ issues generally report that 
populations living near major roadways (and other types of 
transportation infrastructure) tend to be composed of larger fractions 
of nonwhite residents. People living in neighborhoods near such sources 
of air pollution also tend to be lower in income than people living 
elsewhere. Numerous studies evaluating the demographics and 
socioeconomic status of populations or schools near roadways have found 
that they include a greater percentage of minority residents, as well 
as lower SES (indicated by variables such as median household income). 
Locations in these studies include Los Angeles, CA; Seattle, WA; Wayne 
County, MI; Orange County, FL; and the State of California 
 712 713 714 715 716 717 Such disparities may be due to 
multiple factors.\718\
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    \712\ Marshall, J.D. (2008) Environmental inequality: air 
pollution exposures in California's South Coast Air Basin.
    \713\ Su, J.G.; Larson, T.; Gould, T.; Cohen, M.; Buzzelli, M. 
(2010) Transboundary air pollution and environmental justice: 
Vancouver and Seattle compared. GeoJournal 57: 595-608. doi:10.1007/
s10708-009-9269-6 [Online at http://dx.doi.org].
    \714\ Chakraborty, J.; Zandbergen, P.A. (2007) Children at risk: 
measuring racial/ethnic disparities in potential exposure to air 
pollution at school and home. J Epidemiol Community Health 61: 1074-
1079. doi: 10.1136/jech.2006.054130 [Online at http://dx.doi.org].
    \715\ Green, R.S.; Smorodinsky, S.; Kim, J.J.; McLaughlin, R.; 
Ostro, B. (2003) Proximity of California public schools to busy 
roads. Environ Health Perspect 112: 61-66. doi:10.1289/ehp.6566 
[http://dx.doi.org].
    \716\ Wu, Y; Batterman, S.A. (2006) Proximity of schools in 
Detroit, Michigan to automobile and truck traffic. J Exposure Sci & 
Environ Epidemiol. doi:10.1038/sj.jes.7500484 [Online at http://dx.doi.org].
    \717\ Su, J.G.; Jerrett, M.; de Nazelle, A.; Wolch, J. (2011) 
Does exposure to air pollution in urban parks have socioeconomic, 
racial, or ethnic gradients? Environ Res 111: 319-328.
    \718\ Depro, B.; Timmins, C. (2008) Mobility and environmental 
equity: do housing choices determine exposure to air pollution? 
North Caroline State University Center for Environmental and 
Resource Economic Policy.
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    People with low SES often live in neighborhoods with multiple 
stressors and health risk factors, including reduced health insurance 
coverage rates, higher smoking and drug use rates, limited access to 
fresh food, visible neighborhood violence, and elevated rates of 
obesity and some diseases such as asthma, diabetes, and ischemic heart 
disease. Although questions remain, several studies find stronger 
associations between air pollution and health in locations with such 
chronic neighborhood stress, suggesting that populations in these areas 
may be more susceptible to the effects of air pollution. 
719 720 721 722 Household-level

[[Page 73847]]

stressors such as parental smoking and relationship stress also may 
increase susceptibility to the adverse effects of air 
pollution.723 724
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    \719\ Clougherty, J.E.; Kubzansky, L.D. (2009) A framework for 
examining social stress and susceptibility to air pollution in 
respiratory health. Environ Health Perspect 117: 1351-1358. 
Doi:10.1289/ehp.0900612 [Online at http://dx.doi.org].
    \720\ Clougherty, J.E.; Levy, J.I.; Kubzansky, L.D.; Ryan, P.B.; 
Franco Suglia, S.; Jacobson Canner, M.; Wright, R.J. (2007) 
Synergistic effects of traffic-related air pollution and exposure to 
violence on urban asthma etiology. Environ Health Perspect 115: 
1140-1146. doi:10.1289/ehp.9863 [Online at http://dx.doi.org].
    \721\ Finkelstein, M.M.; Jerrett, M.; DeLuca, P.; Finkelstein, 
N.; Verma, D.K.; Chapman, K.; Sears, M.R. (2003) Relation between 
income, air pollution and mortality: a cohort study. Canadian Med 
Assn J 169: 397-402.
    \722\ Shankardass, K.; McConnell, R.; Jerrett, M.; Milam, J.; 
Richardson, J.; Berhane, K. (2009) Parental stress increases the 
effect of traffic-related air pollution on childhood asthma 
incidence. Proc Natl Acad Sci 106: 12406-12411. doi:10.1073/
pnas.0812910106 [Online at http://dx.doi.org].
    \723\ Lewis, A.S.; Sax, S.N.; Wason, S.C.; Campleman, S.L (2011) 
Non-chemical stressors and cumulative risk assessment: an overview 
of current initiatives and potential air pollutant interactions. Int 
J Environ Res Public Health 8: 2020-2073. Doi:10.3390/ijerph8062020 
[Online at http://dx.doi.org].
    \724\ Rosa, M.J.; Jung, K.H.; Perzanowski, M.S.; Kelvin, E.A.; 
Darling, K.W.; Camann, D.E.; Chillrud, S.N.; Whyatt, R.M.; Kinney, 
P.L.; Perera, F.P.; Miller, R.L (2010) Prenatal exposure to 
polycyclic aromatic hydrocarbons, environmental tobacco smoke and 
asthma. Respir Med (In press). doi:10.1016/j.rmed.2010.11.022 
[Online at http://dx.doi.org].
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    More recently, three publications report nationwide analyses that 
compare the demographic patterns of people who do or do not live near 
major roadways.725 726 727 All three of these studies found 
that people living near major roadways are more likely to be minorities 
or low in SES. They also found that the outcomes of their analyses 
varied between regions within the U.S. However, only one such study 
looked at whether such conclusions were confounded by living in a 
location with higher population density and how demographics differ 
between locations nationwide. In general, it found that higher density 
areas have higher proportions of low income and minority residents.
---------------------------------------------------------------------------

    \725\ Rowangould, G.M. (2013) A census of the U.S. near-roadway 
population: public health and environmental justice considerations. 
Transportation Research Part D; 59-67.
    \726\ Tian, N.; Xue, J.; Barzyk. T.M. (2013) Evaluating 
socioeconomic and racial differences in traffic-related metrics in 
the United States using a GIS approach. J Exposure Sci Environ 
Epidemiol 23: 215-222.
    \727\ Boehmer, T.K.; Foster, S.L.; Henry, J.R.; Woghiren-
Akinnifesi, E.L.; Yip, F.Y. (2013) Residential proximity to major 
highways--United States, 2010. Morbidity and Mortality Weekly Report 
62(3): 46-50.
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    We analyzed two national databases that allowed us to evaluate 
whether homes and schools were located near a major road and whether 
disparities in exposure may be occurring in these environments. The 
American Housing Survey (AHS) includes descriptive statistics of over 
70,000 housing units across the nation. The study survey is conducted 
every two years by the U.S. Census Bureau. The second database we 
analyzed was the U.S. Department of Education's Common Core of Data, 
which includes enrollment and location information for schools across 
the U.S.
    In analyzing the 2009 AHS, we focused on whether or not a housing 
unit was located within 300 feet of ``4-or-more lane highway, railroad, 
or airport.'' \728\ We analyzed whether there were differences between 
households in such locations compared with those in locations farther 
from these transportation facilities.\729\ We included other variables, 
such as land use category, region of country, and housing type. We 
found that homes with a nonwhite householder were 22-34 percent more 
likely to be located within 300 feet of these large transportation 
facilities than homes with white householders. Homes with a Hispanic 
householder were 17-33 percent more likely to be located within 300 
feet of these large transportation facilities than homes with non-
Hispanic householders. Households near large transportation facilities 
were, on average, lower in income and educational attainment, more 
likely to be a rental property and located in an urban area compared 
with households more distant from transportation facilities.
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    \728\ This variable primarily represents roadway proximity. 
According to the Central Intelligence Agency's World Factbook, in 
2010, the United States had 6,506,204 km or roadways, 224,792 km of 
railways, and 15,079 airports. Highways thus represent the 
overwhelming majority of transportation facilities described by this 
factor in the AHS.
    \729\ Bailey, C. (2011) Demographic and Social Patterns in 
Housing Units Near Large Highways and other Transportation Sources. 
Memorandum to docket.
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    In examining schools near major roadways, we examined the Common 
Core of Data (CCD) from the U.S. Department of Education, which 
includes information on all public elementary and secondary schools and 
school districts nationwide.\730\ To determine school proximities to 
major roadways, we used a geographic information system (GIS) to map 
each school and roadways based on the U.S. Census's TIGER roadway 
file.\731\ We found that minority students were overrepresented at 
schools within 200 meters of the largest roadways, and that schools 
within 200 meters of the largest roadways also had higher than expected 
numbers of students eligible for free or reduced-price lunches. For 
example, Black students represent 22 percent of students at schools 
located within 200 meters of a primary road, whereas Black students 
represent 17 percent of students in all U.S. schools. Hispanic students 
represent 30 percent of students at schools located within 200 meters 
of a primary road, whereas Hispanic students represent 22 percent of 
students in all U.S. schools.
---------------------------------------------------------------------------

    \730\ http://nces.ed.gov/ccd/.
    \731\ Pedde, M.; Bailey, C. (2011) Identification of Schools 
within 200 Meters of U.S. Primary and Secondary Roads. Memorandum to 
the docket.
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    Overall, there is substantial evidence that people who live or 
attend school near major roadways are more likely to be of a minority 
race, Hispanic ethnicity, and/or low SES. The emission reductions from 
these final rules will likely result in widespread air quality 
improvements, but the impact on pollution levels in close proximity to 
roadways will be most direct. Thus, these final rules will likely help 
in mitigating the disparity in racial, ethnic, and economically based 
exposures.

B. Environmental Effects of Non-GHG Pollutants

(1) Visibility
    Visibility can be defined as the degree to which the atmosphere is 
transparent to visible light.\732\ Visibility impairment is caused by 
light scattering and absorption by suspended particles and gases. 
Visibility is important because it has direct significance to people's 
enjoyment of daily activities in all parts of the country. Individuals 
value good visibility for the well-being it provides them directly, 
where they live and work, and in places where they enjoy recreational 
opportunities. Visibility is also highly valued in significant natural 
areas, such as national parks and wilderness areas, and special 
emphasis is given to protecting visibility in these areas. For more 
information on visibility see the final 2009 p.m. ISA.\733\
---------------------------------------------------------------------------

    \732\ National Research Council, (1993). Protecting Visibility 
in National Parks and Wilderness Areas. National Academy of Sciences 
Committee on Haze in National Parks and Wilderness Areas. National 
Academy Press, Washington, DC. This book can be viewed on the 
National Academy Press Web site at http://www.nap.edu/books/0309048443/html/.
    \733\ U.S. EPA. (2009). Integrated Science Assessment for 
Particulate Matter (Final Report). U.S. Environmental Protection 
Agency, Washington, DC, EPA/600/R-08/139F.
---------------------------------------------------------------------------

    EPA is working to address visibility impairment. Reductions in air 
pollution from implementation of various programs associated with the 
Clean Air Act Amendments of 1990 (CAAA) provisions have resulted in 
substantial improvements in visibility and will continue to do so in 
the future. Because trends in haze are closely associated with trends 
in particulate sulfate and nitrate due to the relationship between 
their concentration and light extinction, visibility trends have 
improved as emissions of SO2 and NOX have 
decreased over time due to air pollution

[[Page 73848]]

regulations such as the Acid Rain Program.\734\
---------------------------------------------------------------------------

    \734\ U.S. EPA. 2009 Final Report: Integrated Science Assessment 
for Particulate Matter. U.S. Environmental Protection Agency, 
Washington, DC, EPA/600/R-08/139F, 2009.
---------------------------------------------------------------------------

    In the Clean Air Act Amendments of 1977, Congress recognized 
visibility's value to society by establishing a national goal to 
protect national parks and wilderness areas from visibility impairment 
caused by manmade pollution.\735\ In 1999, EPA finalized the regional 
haze program to protect the visibility in Mandatory Class I Federal 
areas.\736\ There are 156 national parks, forests and wilderness areas 
categorized as Mandatory Class I Federal areas.\737\ These areas are 
defined in CAA Section 162 as those national parks exceeding 6,000 
acres, wilderness areas and memorial parks exceeding 5,000 acres, and 
all international parks which were in existence on August 7, 1977.
---------------------------------------------------------------------------

    \735\ See Section 169(a) of the Clean Air Act.
    \736\ 64 FR 35714, July 1, 1999.
    \737\ 62 FR 38680-38681, July 18, 1997.
---------------------------------------------------------------------------

    EPA has also concluded that PM2.5 causes adverse effects 
on visibility in other areas that are not targeted by the Regional Haze 
Rule, such as urban areas, depending on PM2.5 concentrations 
and other factors such as dry chemical composition and relative 
humidity (i.e., an indicator of the water composition of the 
particles). EPA revised the PM2.5 standards in December 2012 
and established a target level of protection that is expected to be met 
through attainment of the existing secondary standards for 
PM2.5.
(2) Plant and Ecosystem Effects of Ozone
    The welfare effects of ozone can be observed across a variety of 
scales, i.e. subcellular, cellular, leaf, whole plant, population and 
ecosystem. Ozone effects that begin at small spatial scales, such as 
the leaf of an individual plant, when they occur at sufficient 
magnitudes (or to a sufficient degree) can result in effects being 
propagated along a continuum to larger and larger spatial scales. For 
example, effects at the individual plant level, such as altered rates 
of leaf gas exchange, growth and reproduction, can, when widespread, 
result in broad changes in ecosystems, such as productivity, carbon 
storage, water cycling, nutrient cycling, and community composition.
    Ozone can produce both acute and chronic injury in sensitive 
species depending on the concentration level and the duration of the 
exposure.\738\ In those sensitive species,\739\ effects from repeated 
exposure to ozone throughout the growing season of the plant tend to 
accumulate, so that even low concentrations experienced for a longer 
duration have the potential to create chronic stress on 
vegetation.\740\ Ozone damage to sensitive species includes impaired 
photosynthesis and visible injury to leaves. The impairment of 
photosynthesis, the process by which the plant makes carbohydrates (its 
source of energy and food), can lead to reduced crop yields, timber 
production, and plant productivity and growth. Impaired photosynthesis 
can also lead to a reduction in root growth and carbohydrate storage 
below ground, resulting in other, more subtle plant and ecosystems 
impacts.\741\ These latter impacts include increased susceptibility of 
plants to insect attack, disease, harsh weather, interspecies 
competition and overall decreased plant vigor. The adverse effects of 
ozone on areas with sensitive species could potentially lead to species 
shifts and loss from the affected ecosystems,\742\ resulting in a loss 
or reduction in associated ecosystem goods and services. Additionally, 
visible ozone injury to leaves can result in a loss of aesthetic value 
in areas of special scenic significance like national parks and 
wilderness areas and reduced use of sensitive ornamentals in 
landscaping.\743\
---------------------------------------------------------------------------

    \738\ 73 FR 16486, March 27, 2008.
    \739\ 73 FR 16491, March 27, 2008. Only a small percentage of 
all the plant species growing within the U.S. (over 43,000 species 
have been catalogued in the USDA PLANTS database) have been studied 
with respect to ozone sensitivity.
    \740\ The concentration at which ozone levels overwhelm a 
plant's ability to detoxify or compensate for oxidant exposure 
varies. Thus, whether a plant is classified as sensitive or tolerant 
depends in part on the exposure levels being considered. Chapter 9, 
Section 9.3.4 of U.S. EPA, 2013 Integrated Science Assessment for 
Ozone and Related Photochemical Oxidants. Office of Research and 
Development/National Center for Environmental Assessment. U.S. 
Environmental Protection Agency. EPA 600/R-10/076F.
    \741\ 73 FR 16492, March 27, 2008.
    \742\ 73 FR 16493-16494, March 27, 2008, Ozone impacts could be 
occurring in areas where plant species sensitive to ozone have not 
yet been studied or identified.
    \743\ 73 FR 16490-16497, March 27, 2008.
---------------------------------------------------------------------------

    The most recent Integrated Science Assessment (ISA) for Ozone 
presents more detailed information on how ozone affects vegetation and 
ecosystems.\744\ The ISA concludes that ambient concentrations of ozone 
are associated with a number of adverse welfare effects and 
characterizes the weight of evidence for different effects associated 
with ozone.\745\ The ISA concludes that visible foliar injury effects 
on vegetation, reduced vegetation growth, reduced productivity in 
terrestrial ecosystems, reduced yield and quality of agricultural 
crops, and alteration of below-ground biogeochemical cycles are 
causally associated with exposure to ozone. It also concludes that 
reduced carbon sequestration in terrestrial ecosystems, alteration of 
terrestrial ecosystem water cycling, and alteration of terrestrial 
community composition are likely to be causally associated with 
exposure to ozone.
---------------------------------------------------------------------------

    \744\ U.S. EPA. Integrated Science Assessment of Ozone and 
Related Photochemical Oxidants (Final Report). U.S. Environmental 
Protection Agency, Washington, DC, EPA/600/R-10/076F, 2013. The ISA 
is available at http://cfpub.epa.gov/ncea/isa/recordisplay.cfm?deid=247492#Download.
    \745\ The Ozone ISA evaluates the evidence associated with 
different ozone related health and welfare effects, assigning one of 
five ``weight of evidence'' determinations: causal relationship, 
likely to be a causal relationship, suggestive of a causal 
relationship, inadequate to infer a causal relationship, and not 
likely to be a causal relationship. For more information on these 
levels of evidence, please refer to Table II of the ISA.
---------------------------------------------------------------------------

(3) Atmospheric Deposition
    Wet and dry deposition of ambient particulate matter delivers a 
complex mixture of metals (e.g., mercury, zinc, lead, nickel, aluminum, 
and cadmium), organic compounds (e.g., polycyclic organic matter, 
dioxins, and furans) and inorganic compounds (e.g., nitrate, sulfate) 
to terrestrial and aquatic ecosystems. The chemical form of the 
compounds deposited depends on a variety of factors including ambient 
conditions (e.g., temperature, humidity, oxidant levels) and the 
sources of the material. Chemical and physical transformations of the 
compounds occur in the atmosphere as well as the media onto which they 
deposit. These transformations in turn influence the fate, 
bioavailability and potential toxicity of these compounds.
    Adverse impacts to human health and the environment can occur when 
particulate matter is deposited to soils, water, and biota.\746\ 
Deposition of heavy metals or other toxics may lead to the human 
ingestion of contaminated fish, impairment of drinking water, damage to 
terrestrial, freshwater and marine ecosystem components, and limits to 
recreational uses. Atmospheric deposition has been identified as a key 
component of the environmental and human health hazard posed by several 
pollutants including mercury, dioxin and PCBs.\747\
---------------------------------------------------------------------------

    \746\ U.S. EPA. Integrated Science Assessment for Particulate 
Matter (Final Report). U.S. Environmental Protection Agency, 
Washington, DC, EPA/600/R-08/139F, 2009.
    \747\ U.S. EPA. (2000). Deposition of Air Pollutants to the 
Great Waters: Third Report to Congress. Office of Air Quality 
Planning and Standards. EPA-453/R-00-0005.

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

[[Page 73849]]

    The ecological effects of acidifying deposition and nutrient 
enrichment are detailed in the Integrated Science Assessment for Oxides 
of Nitrogen and Sulfur-Ecological Criteria.\748\ Atmospheric deposition 
of nitrogen and sulfur contributes to acidification, altering 
biogeochemistry and affecting animal and plant life in terrestrial and 
aquatic ecosystems across the United States. The sensitivity of 
terrestrial and aquatic ecosystems to acidification from nitrogen and 
sulfur deposition is predominantly governed by geology. Prolonged 
exposure to excess nitrogen and sulfur deposition in sensitive areas 
acidifies lakes, rivers and soils. Increased acidity in surface waters 
creates inhospitable conditions for biota and affects the abundance and 
biodiversity of fishes, zooplankton and macroinvertebrates and 
ecosystem function. Over time, acidifying deposition also removes 
essential nutrients from forest soils, depleting the capacity of soils 
to neutralize future acid loadings and negatively affecting forest 
sustainability. Major effects in forests include a decline in sensitive 
tree species, such as red spruce (Picea rubens) and sugar maple (Acer 
saccharum). In addition to the role nitrogen deposition plays in 
acidification, nitrogen deposition also leads to nutrient enrichment 
and altered biogeochemical cycling. In aquatic systems increased 
nitrogen can alter species assemblages and cause eutrophication. In 
terrestrial systems nitrogen loading can lead to loss of nitrogen-
sensitive lichen species, decreased biodiversity of grasslands, meadows 
and other sensitive habitats, and increased potential for invasive 
species. For a broader explanation of the topics treated here, refer to 
the description in Chapter 8.1.2.3 of the RIA.
---------------------------------------------------------------------------

    \748\ NOX and SOX secondary ISA\1\ U.S. 
EPA. Integrated Science Assessment (ISA) for Oxides of Nitrogen and 
Sulfur Ecological Criteria (Final Report). U.S. Environmental 
Protection Agency, Washington, DC, EPA/600/R-08/082F, 2008.
---------------------------------------------------------------------------

    Building materials including metals, stones, cements, and paints 
undergo natural weathering processes from exposure to environmental 
elements (e.g., wind, moisture, temperature fluctuations, sunlight, 
etc.). Pollution can worsen and accelerate these effects. Deposition of 
PM is associated with both physical damage (materials damage effects) 
and impaired aesthetic qualities (soiling effects). Wet and dry 
deposition of PM can physically affect materials, adding to the effects 
of natural weathering processes, by potentially promoting or 
accelerating the corrosion of metals, by degrading paints and by 
deteriorating building materials such as stone, concrete and 
marble.\749\ The effects of PM are exacerbated by the presence of 
acidic gases and can be additive or synergistic due to the complex 
mixture of pollutants in the air and surface characteristics of the 
material. Acidic deposition has been shown to have an effect on 
materials including zinc/galvanized steel and other metal, carbonate 
stone (as monuments and building facings), and surface coatings 
(paints).\750\ The effects on historic buildings and outdoor works of 
art are of particular concern because of the uniqueness and 
irreplaceability of many of these objects.
---------------------------------------------------------------------------

    \749\ U.S. Environmental Protection Agency (U.S. EPA). 2009. 
Integrated Science Assessment for Particulate Matter (Final Report). 
EPA-600-R-08-139F. National Center for Environmental Assessment--RTP 
Division. December. Available on the Internet at <http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=216546>.
    \750\ Irving, P.M., e.d. 1991. Acid Deposition: State of Science 
and Technology, Volume III, Terrestrial, Materials, Health, and 
Visibility Effects, The U.S. National Acid Precipitation Assessment 
Program, Chapter 24, page 24-76.
---------------------------------------------------------------------------

(4) Environmental Effects of Air Toxics
    Emissions from producing, transporting and combusting fuel 
contribute to ambient levels of pollutants that contribute to adverse 
effects on vegetation. Volatile organic compounds, some of which are 
considered air toxics, have long been suspected to play a role in 
vegetation damage.\751\ In laboratory experiments, a wide range of 
tolerance to VOCs has been observed.\752\ Decreases in harvested seed 
pod weight have been reported for the more sensitive plants, and some 
studies have reported effects on seed germination, flowering and fruit 
ripening. Effects of individual VOCs or their role in conjunction with 
other stressors (e.g., acidification, drought, temperature extremes) 
have not been well studied. In a recent study of a mixture of VOCs 
including ethanol and toluene on herbaceous plants, significant effects 
on seed production, leaf water content and photosynthetic efficiency 
were reported for some plant species.\753\
---------------------------------------------------------------------------

    \751\ U.S. EPA. (1991). Effects of organic chemicals in the 
atmosphere on terrestrial plants. EPA/600/3-91/001.
    \752\ Cape JN, ID Leith, J Binnie, J Content, M Donkin, M 
Skewes, DN Price AR Brown, AD Sharpe. (2003). Effects of VOCs on 
herbaceous plants in an open-top chamber experiment. Environ. 
Pollut. 124:341-343.
    \753\ Cape JN, ID Leith, J Binnie, J Content, M Donkin, M 
Skewes, DN Price AR Brown, AD Sharpe. (2003). Effects of VOCs on 
herbaceous plants in an open-top chamber experiment. Environ. 
Pollut. 124:341-343.
---------------------------------------------------------------------------

    Research suggests an adverse impact of vehicle exhaust on plants, 
which has in some cases been attributed to aromatic compounds and in 
other cases to nitrogen oxides.754 755 756
---------------------------------------------------------------------------

    \754\ Viskari E-L. (2000). Epicuticular wax of Norway spruce 
needles as indicator of traffic pollutant deposition. Water, Air, 
and Soil Pollut. 121:327-337.
    \755\ Ugrekhelidze D, F Korte, G Kvesitadze. (1997). Uptake and 
transformation of benzene and toluene by plant leaves. Ecotox. 
Environ. Safety 37:24-29.
    \756\ Kammerbauer H, H Selinger, R Rommelt, A Ziegler-Jons, D 
Knoppik, B Hock. (1987). Toxic components of motor vehicle emissions 
for the spruce Picea abies. Environ. Pollut. 48:235-243.
---------------------------------------------------------------------------

C. Emissions Inventory Impacts

    As described in Section VII, the agencies conducted two analyses 
for these rules using DOT's CAFE model and EPA's MOVES model, relative 
to different reference cases (i.e., different baselines). The agencies 
used EPA's MOVES model to estimate the non-GHG impacts for tractor-
trailers (including the engine that powers the vehicle) and vocational 
vehicles (including the engine that powers the vehicle). For heavy-duty 
pickups and vans, the agencies performed separate analyses using the 
CAFE model (included in NHTSA's ``Method A;'' See Section VI) and the 
MOVES model (included in EPA's ``Method B;'' See Section VI) to 
estimate non-GHG emissions from these vehicles. For these methods, the 
agencies analyzed the impact of the rules relative to two different 
reference cases--flat and dynamic. The flat baseline projects very 
little improvement in new vehicles in the absence of new Phase 2 
standards. In contrast, the dynamic baseline projects more significant 
improvements in vehicle fuel efficiency. The agencies considered both 
reference cases. The results for all of the regulatory alternatives 
relative to both reference cases, derived via the same methodologies 
discussed in Section VII of the Preamble, are presented in Section X of 
the Preamble.
    For brevity, a subset of these analyses are presented in this 
section and the reader is referred to both Chapter 11 of the RIA and 
NHTSA's FEIS Chapters 3, 4 and 5 for complete sets of these analyses. 
In this section, Method A is presented for the final standards, 
relative to both the dynamic baseline (Alternative 1b) and the flat 
baseline (Alternative 1a). Method B is presented for the final 
standards, relative only to the flat baseline.
    The following subsections summarize two slightly different analyses 
of the annual non-GHG emissions reductions expected from these 
standards. Section VIII.A.(1) presents the impacts of the

[[Page 73850]]

final rules on non-GHG emissions using the analytical Method A, 
relative to two different reference cases--flat and dynamic. Section 
VIII.A.(2) presents the impacts of these standards, relative to the 
flat reference case only, using the MOVES model for all heavy-duty 
vehicle categories.
(1) Impacts of the Final Rules Using Analysis Method A
(a) Calendar Year Analysis
(i) Upstream Impacts of the Final Program
    Increasing efficiency in heavy-duty vehicles will result in reduced 
fuel demand and, therefore, reductions in the emissions associated with 
all processes involved in getting petroleum to the pump. Both Method A 
and Method B project these impacts for fuel consumed by vocational 
vehicles and combination tractor-trailers, using EPA's MOVES model. See 
Section VII.A. for the description of this methodology. To project 
these impacts for fuel consumed by HD pickups and vans, Method A used 
similar calculations and inputs applicable to the CAFE model, as 
discussed above in Section VI. More information on the development of 
the emission factors used in this analysis can be found in Chapter 5 of 
the RIA.
    The following two tables summarize the projected upstream emission 
impacts of the final program on both criteria pollutants and air toxics 
from the heavy-duty sector, relative to Alternative 1b (dynamic 
baseline conditions under the No-Action Alternative) and Alternative 1a 
(flat baseline conditions under the No-Action Alternative), using 
analysis method A. Using either No-Action Alternative shows decreases 
in upstream emissions of all criteria pollutants, precursors, and air 
toxics; using Alternative 1a as the reference point attributes more of 
the emission reduction to the standards. Note that the rule is 
projected, in all analyses, of reducing emissions of NOX, 
contrary to implications in some of the public comments that fuel 
efficiency/GHG controls come at the expense of increased NOX 
emissions.

 Table VIII-1--Annual Upstream Impacts on Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040 and 2050--Final Program
                                                          vs. Alt 1b Using Analysis Method A a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................              -1            -4.9              -4             -18              -5             -19
Acetaldehyde............................................              -3            -4.4             -14             -15             -16             -16
Acrolein................................................            -0.4            -4.6              -2             -16              -2             -17
Benzene.................................................             -23            -4.8             -88             -16            -105             -18
CO......................................................          -3,785            -4.9         -14,714             -17         -17,629             -19
Formaldehyde............................................             -18            -4.9             -71             -17             -86             -19
NOX.....................................................          -9,255            -4.9         -35,964             -17         -43,089             -19
PM2.5...................................................            -975            -4.9          -3,850             -18          -4,618             -19
SOX.....................................................          -5,804            -4.9         -22,550             -17         -27,019             -19
VOC.....................................................          -4,419            -4.8         -14,857             -15         -17,385             -16
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.


 Table VIII-2--Annual Upstream Impacts on Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040 and 2050--Final Program
                                                          vs. Alt 1a Using Analysis Method A a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................              -1            -5.3              -4             -20              -5             -21
Acetaldehyde............................................              -4            -4.6             -15             -16             -17             -17
Acrolein................................................            -0.4            -4.9              -2             -17              -2             -18
Benzene.................................................             -25            -5.1             -96             -18            -115             -19
CO......................................................          -4,142            -5.4         -16,298             -19         -19,558             -20
Formaldehyde............................................             -20            -5.3             -79             -19             -95             -20
NOX.....................................................         -10,124            -5.4         -39,813             -19         -47,779             -20
PM2.5...................................................          -1,065            -5.3          -4,258             -19          -5,117             -21
SOX.....................................................          -6,349            -5.4         -24,961             -19         -29,958             -20
VOC.....................................................          -4,810            -5.2         -16,218             -16         -19,004             -17
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

(ii) Downstream Impacts of the Final Program

    For vocational vehicles and tractor-trailers, the agencies used the 
MOVES model to determine non-GHG emissions inventories. The 
improvements in engine efficiency and road load, the increased use of 
APUs, and VMT rebound were included in the MOVES analysis. For NHTSA's 
Method A analysis, presented in this section, the DOT CAFE model was 
used for HD pickups and vans. Further information about DOT's CAFE 
model is available in Section VI.C and Chapter 10 of the RIA. The 
following two tables summarize the projected downstream emission 
impacts of the final program on both criteria pollutants and air toxics 
from the heavy-duty sector, relative to Alternative 1b and Alternative 
1a, using analysis Method A. Using either baseline shows a reduction in 
all criteria pollutants and air toxics--except for 1,3-Butadiene,

[[Page 73851]]

and CY2025 levels of acrolein, which show small increases in downstream 
emissions.

    Table VIII-3--Annual Downstream Impacts on Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040 and 2050--Final
                                                      Program vs. Alt 1b Using Analysis Method A a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................               1             0.5               4             3.6               4             3.4
Acetaldehyde............................................              -1             0.0             -16            -0.7             -19            -0.8
Acrolein................................................             0.2             0.0            -0.3            -0.1              -1            -0.4
Benzene.................................................              -2            -0.1             -13            -1.2             -13            -1.1
CO......................................................          -9,045            -0.6         -34,702            -2.8         -42,095            -3.0
Formaldehyde............................................             -21            -0.3             -96            -1.6            -119            -1.8
NOX.....................................................         -12,082            -1.3         -53,254            -9.1         -65,068            -9.9
PM2.5 \b\...............................................             -58            -0.2            -363            -2.0            -453            -2.2
SOX.....................................................            -201            -4.1            -851             -16          -1,028             -17
VOC.....................................................            -769            -0.8          -3,436            -5.3          -4,128            -5.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
\b\ PM2.5 from tire wear and brake wear are included.


    Table VIII-4--Annual Downstream Impacts on Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040 and 2050--Final
                                                      Program vs. Alt 1a Using Analysis Method A a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................               1             0.5               4             3.7               4             3.5
Acetaldehyde............................................              -1             0.0             -14            -0.7             -18            -0.8
Acrolein................................................             0.2             0.0            -0.3            -0.1              -1            -0.4
Benzene.................................................              -2            -0.2             -13            -1.2             -14            -1.2
CO......................................................          -8,944            -0.6         -34,502            -2.8         -41,880            -3.0
Formaldehyde............................................             -20            -0.3             -91            -1.6            -113            -1.7
NOX.....................................................         -13,368            -1.5         -60,594           -10.2         -74,206             -11
PM2.5 \b\...............................................             -78            -0.2            -473            -2.6            -591            -2.9
SOX.....................................................            -219            -4.5            -941             -17          -1,138             -19
VOC.....................................................            -831            -0.8          -3,736            -5.8          -4,499            -6.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
\b\ PM2.5 from tire wear and brake wear are included.

(iii) Total Impacts of the Final Program
    The following two tables summarize the projected upstream emission 
impacts of the final program on both criteria pollutants and air toxics 
from the heavy-duty sector, relative to Alternative 1b and Alternative 
1a, using analysis Method A. Under both baselines, Method A predicts a 
decrease in total emissions by calendar year 2050, but the amount 
attributable to the standards is larger using the flat baseline than 
the dynamic baseline.

 Table VIII-5--Annual Total Impacts (Upstream and Downstream) of Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040
                                              and 2050--Final Program vs. Alt 1b Using Analysis Method A a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................             0.3             0.1             0.1             0.1            -0.4            -0.3
Acetaldehyde............................................              -4            -0.1             -30            -1.3             -35            -1.4
Acrolein................................................            -0.2             0.0              -2            -0.7              -3            -0.9
Benzene.................................................             -25            -1.2            -101            -6.3            -118            -6.7
CO......................................................         -12,830            -0.9         -49,416            -3.7         -59,724            -4.0
Formaldehyde............................................             -39            -0.5            -167            -2.7            -205            -2.9
NOX.....................................................         -21,337            -2.0         -89,218             -11        -108,157             -12
PM2.5...................................................          -1,033            -2.0          -4,213             -10          -5,071             -11
SOX.....................................................          -6,005            -4.9         -23,401             -17         -28,047             -19
VOC.....................................................          -5,188            -2.7         -18,293             -11         -21,513             -12
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:

[[Page 73852]]

 
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.


 Table VIII-6--Annual Total Impacts (Upstream and Downstream) of Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040
                                              and 2050--Final Program vs. Alt 1a Using Analysis Method A a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................             0.2             0.1            -0.2            -0.1            -1.0            -0.5
Acetaldehyde............................................              -5            -0.2             -29            -1.3             -35            -1.4
Acrolein................................................            -0.2             0.0              -2            -0.7              -3            -1.0
Benzene.................................................             -27            -1.4            -109            -6.8            -129            -7.2
CO......................................................         -13,086            -0.9         -50,800            -3.8         -61,438            -4.1
Formaldehyde............................................             -40            -0.5            -170            -2.7            -208            -2.9
NOX.....................................................         -23,492            -2.2        -100,407             -12        -121,985             -14
PM2.5...................................................          -1,143            -2.2          -4,731             -12          -5,708             -13
SOX.....................................................          -6,568            -5.3         -25,902             -19         -31,096             -20
VOC.....................................................          -5,641            -3.0         -19,954             -12         -23,503             -13
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

(b) Model Year Lifetime Analysis
    Table VIII-7 shows the lifetime Non-GHG reductions for model years 
2018-2029 attributable to the standards using Method A relative to both 
No-Action Alternatives. For NOX, approximately half of the 
emission reductions are downstream and half are upstream. However, for 
PM2.5 and SOX proportionally more of the emission 
reductions are attributable to upstream emission reductions than to 
downstream emission reductions. A similar pattern emerges as with 
single calendar year snapshots; more emission reductions are 
attributable to the standards using the 1a baseline as the reference 
point than by using the 1b baseline as the reference point.

   Table VIII-7--Lifetime Non-GHG Reductions Using Analysis Method A--
                    Summary for Model Years 2018-2029
                           [U.S. Short Tons] a
------------------------------------------------------------------------
                                                   Final program
    NO-action alternative (baseline)     -------------------------------
                                           1b (Dynamic)      1a (Flat)
------------------------------------------------------------------------
NOX.....................................         494,495         548,630
    Downstream..........................         246,509         276,413
    Upstream............................         247,986         272,217
PM2.5...................................          27,827          30,838
    Downstream\b\.......................           1,437           1,891
    Upstream............................          26,390          28,947
SOX.....................................         159,367         174,918
    Downstream..........................           3,849           4,214
    Upstream............................         155,518         170,704
------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.
\b\ PM2.5 from tire wear and brake wear are included.

(2) Impacts of the Final Rules Using Analysis Method B
(a) Calendar Year Analysis
(i) Upstream Impacts of the Final Program
    Increasing efficiency in heavy-duty vehicles will result in reduced 
fuel demand and, therefore, reductions in the emissions associated with 
all processes involved in getting petroleum to the pump. To project 
these impacts, Method B estimated the impact of reduced petroleum 
volumes on the extraction and transportation of crude oil as well as 
the production and distribution of finished gasoline and diesel. For 
the purpose of assessing domestic-only emission reductions, it was 
necessary to estimate the fraction of fuel savings attributable to 
domestic finished gasoline and diesel and, of this fuel, what fraction 
is produced from domestic crude. Method B estimated the emissions 
associated with production and distribution of gasoline and diesel from 
crude oil based on emission factors in the ``Greenhouse Gases, 
Regulated Emissions, and Energy used in Transportation'' model (GREET) 
developed by DOE's Argonne National Laboratory. In some cases, the 
GREET values were modified or updated by the agencies to be consistent 
with the National Emission Inventory (NEI) and emission factors from 
MOVES. Method B estimated the projected corresponding changes in 
upstream emissions using the same tools originally created for the 
Renewable Fuel Standard 2 (RFS2) rulemaking analysis,\757\ used in the 
LD

[[Page 73853]]

GHG rulemakings,\758\ HD GHG Phase 1,\759\ and updated for the current 
analysis. More information on the development of the emission factors 
used in this analysis can be found in Chapter 5 of the RIA.
---------------------------------------------------------------------------

    \757\ U.S. EPA. Draft Regulatory Impact Analysis: Changes to 
Renewable Fuel Standard Program. Chapters 2 and 3. May 26, 2009. 
Docket ID: EPA-HQ-OAR-2009-0472-0119.
    \758\ 2017 and Later Model Year Light-Duty Vehicle Greenhouse 
Gas Emissions and Corporate Average Fuel Economy Standards (77 FR 
62623, October 15, 2012).
    \759\ Greenhouse Gas Emission Standards and Fuel Efficiency 
Standards for Medium- and Heavy-Duty Engines and Vehicles (76 FR 
57106, September 15, 2011).
---------------------------------------------------------------------------

    Table VIII-8 summarizes the projected upstream emission impacts of 
the final program on both criteria pollutants and air toxics from the 
heavy-duty sector, relative to Alternative 1a, using analysis Method B. 
The comparable estimates relative to Alternative 1b are presented in 
Section VIII.C.(1).

 Table VIII-8--Annual Upstream Impacts on Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040 and 2050--Final Program
                                                          vs. Alt 1a Using Analysis Method B a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................              -1            -4.8              -5           -19.0              -6           -20.6
Acetaldehyde............................................              -7            -3.2             -35           -14.5             -38           -15.9
Acrolein................................................              -1            -3.5              -3           -15.2              -4           -16.7
Benzene.................................................             -30            -3.8            -143           -16.1            -166           -17.6
CO......................................................          -3,809            -4.8         -16,884           -18.9         -20,227           -20.5
Formaldehyde............................................             -20            -4.6             -90           -18.3            -107           -19.9
NOX.....................................................          -9,314            -4.8         -41,280           -18.9         -49,462           -20.5
PM2.5...................................................          -1,037            -4.7          -4,619           -18.7          -5,520           -20.3
SOX.....................................................          -5,828            -4.8         -25,811           -18.9         -30,941           -20.5
VOC.....................................................          -4,234            -3.7         -20,010           -15.9         -23,240           -17.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

(ii) Downstream Impacts of the Final Program
    The final program will impact the downstream emissions of non-GHG 
pollutants. These pollutants include oxides of nitrogen 
(NOX), oxides of sulfur (SOX), volatile organic 
compounds (VOC), carbon monoxide (CO), fine particulate matter 
(PM2.5), and air toxics. The agencies expect reductions in 
downstream emissions of NOX, PM2.5, VOC, 
SOX, CO, and air toxics. Much of these estimated net 
reductions are a result of the agencies' anticipation of increased use 
of auxiliary power units (APUs) in combination tractors during extended 
idling; APUs emit these pollutants at a lower rate than on-road engines 
during extended idle operation, with the exception of PM2.5. 
As discussed in Section III.C.3, EPA is adopting Phase 1 and Phase 2 
requirements to control PM2.5 emissions from APUs installed 
in new tractors and therefore, eliminate the unintended consequence of 
increased PM2.5 emissions from increased APU use.
    Additional reductions in tailpipe emissions of NOX and 
CO and refueling emissions of VOC will be achieved through improvements 
in engine efficiency and reduced road load (improved aerodynamics and 
tire rolling resistance), which reduces the amount of work required to 
travel a given distance and increases fuel economy. For vehicle types 
not affected by road load improvements, such as HD pickups and vans 
\760\, non-GHG emissions will increase very slightly due to VMT 
rebound. In addition, brake wear and tire wear emissions of 
PM2.5 will also increase very slightly due to VMT rebound. 
The agencies estimate that downstream emissions of SOX will 
be reduced, because they are roughly proportional to fuel consumption.
---------------------------------------------------------------------------

    \760\ HD pickups and vans are subject to gram per mile 
(distance) emission standards, as opposed to larger heavy-duty 
vehicles which are certified to a gram per brake horsepower (work) 
standard.
---------------------------------------------------------------------------

    For vocational vehicles and tractor-trailers, the agencies used 
MOVES to determine non-GHG emissions impacts of the final rules, 
relative to the flat baseline (Alternative 1a) and the dynamic baseline 
(Alternative 1b). The improvements in engine efficiency and road load, 
the increased use of APUs, and VMT rebound were included in the MOVES 
analysis. For this analysis, Method B also used the MOVES model for HD 
pickups and vans.
    The downstream criteria pollutant and air toxics impacts of the 
final program, relative to Alternative 1a, using analysis Method B, are 
presented in Table VIII-9.

    Table VIII-9--Annual Downstream Impacts on Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040 and 2050--Final
                                                      Program vs. Alt 1a Using Analysis Method B a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................              -1            -0.2              -3            -1.5              -3            -1.8
Acetaldehyde............................................              -3            -0.1             -18            -0.8             -23            -0.9
Acrolein................................................            -0.1               0              -1            -0.3              -1            -0.4
Benzene.................................................              -5            -0.2             -22            -1.4             -26            -1.6
CO......................................................          -9,445            -0.4         -35,710            -2.4         -43,642            -2.7

[[Page 73854]]

 
Formaldehyde............................................             -20            -0.2             -97            -1.5            -120            -1.7
NOX.....................................................         -13,396            -1.4         -60,681            -9.7         -74,362           -10.8
PM2.5 \b\...............................................             -73            -0.2            -462            -2.2            -580            -2.5
SOX.....................................................            -252            -4.7          -1,122           -18.5          -1,341           -20.1
VOC.....................................................          -1,071            -0.8          -5,060            -5.9          -6,013            -6.6
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
\b\ PM2.5 from tire wear and brake wear are included.

    As noted above, EPA is adopting Phase 1 and Phase 2 requirements to 
control PM2.5 emissions from APUs installed in new tractors. 
In the NPRM, EPA projected an unintended increase in downstream 
PM2.5 emissions because engines powering APUs are currently 
required to meet less stringent PM standards (40 CFR 1039.101) than on-
road engines (40 CFR 86.007-11) and because the increase in emissions 
from APUs more than offset the reduced tailpipe emissions from improved 
engine efficiency and road load. However, with the new requirements for 
APUs, the final program is projected to lead to reduced downstream 
PM2.5 emissions of 462 tons in 2040 and 580 tons in 2050 
(Table VIII-9). The net reductions in national PM2.5 
emissions from the requirements for APUs are 927 tons and 1,114 tons in 
2040 and 2050, respectively (Table VIII-10). See Section III.C.3 of the 
Preamble for additional details on EPA's PM emission standards for 
APUs. The development of APU emission rates with PM control is 
documented in a memorandum to the docket.\761\
---------------------------------------------------------------------------

    \761\ U.S. EPA. Updates to MOVES for Emissions Analysis of 
Greenhouse Gas Emissions and Fuel Efficiency Standards for Medium- 
and Heavy-Duty Engines and Vehicles--Phase 2 FRM. Docket No. EPA-HQ-
OAR-2016, July 2016.

    Table VIII-10--Impact on PM2.5 Emissions of Further PM2.5 Control on APUs--Final Program vs. Alt 1a Using
                                                Analysis Method B
                                                [US Short Tons] a
----------------------------------------------------------------------------------------------------------------
                                                                  Final HD phase
                                                     Baseline        2 program    Final HD phase   Net impact on
                                                  national heavy- national PM2.5     2 program    national PM2.5
                       CY                          duty vehicle      emissions    national PM2.5   emission with
                                                       PM2.5          without     emissions with    further PM
                                                     emissions      further PM      further PM      control on
                                                      (tons)      control (tons)  control (tons)    APUs (tons)
----------------------------------------------------------------------------------------------------------------
2040............................................          20,939          21,403          20,476            -927
2050............................................          22,995          23,529          22,416          -1,114
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

    It is worth noting that the emission reductions shown in Table 
VIII-9 are not incremental to the emissions reductions projected in the 
Phase 1 rulemaking. This is because, as described in Sections 
III.D.(1).a of the Preamble, the agencies have revised their 
assumptions about the adoption rate of APUs. This final rule assumes 
that without the Phase 2 program (i.e., in the Phase 2 baselines), the 
APU adoption rate will be 9 percent for model years 2010 and later. EPA 
conducted an analysis to estimate the combined emissions impacts of the 
Phase 1 and the Phase 2 programs for NOX, VOC, 
SOX and PM2.5 in calendar year 2050 using 
MOVES2014a. The results are shown in Table VIII-11. For NOX 
and PM2.5 only, we also estimated the combined Phase 1 and 
Phase 2 downstream and upstream emissions impacts for calendar year 
2025, and project that the two rules combined will reduce 
NOX by up to 55,000 tons and PM2.5 by up to 
33,000 tons in that year. For additional details, see Chapter 5 of the 
RIA.

  Table VIII-11--Combined Phase 1 and Phase 2 Annual Downstream Impacts on Criteria Pollutants From Heavy-Duty
                 Sector in Calendar Year 2050--Final Program vs. Alt 1a Using Analysis Method B
                                                [US Short Tons] a
----------------------------------------------------------------------------------------------------------------
                     CY                             NOX              VOC              SOX           PM2.5 \b\
----------------------------------------------------------------------------------------------------------------
2050........................................        -100,878          -10,067           -2,249           -1,001
----------------------------------------------------------------------------------------------------------------
Notes:

[[Page 73855]]

 
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and more dynamic baseline, 1b, please see Section X.A.1.

(iii) Total Impacts of the Final Program
    As shown in Table VIII-12, EPA estimates that the final program 
will result in overall net reductions of NOX, VOC, 
SOX, CO, PM2.5, and air toxics emissions. The 
results are shown both in changes in absolute tons and in percent 
reductions from the flat reference to the final program for the heavy-
duty sector.

 Table VIII-12--Annual Total Impacts (Upstream and Downstream) of Criteria Pollutants and Air Toxics From Heavy-Duty Sector in Calendar Years 2025, 2040
                                             and 2050--Final Program vs. Alt 1a Using Analysis Method B \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      CY2025                          CY2040                          CY2050
                        Pollutant                        -----------------------------------------------------------------------------------------------
                                                           US short tons     % Change      US short tons     % Change      US short tons     % Change
--------------------------------------------------------------------------------------------------------------------------------------------------------
1,3-Butadiene...........................................              -2            -0.5              -8            -3.7              -9            -4.1
Acetaldehyde............................................             -10            -0.3             -53            -2.0             -61            -2.1
Acrolein................................................              -1            -0.1              -4            -1.3              -5            -1.3
Benzene.................................................             -35            -1.1            -165            -6.8            -192            -7.5
CO......................................................         -13,254            -0.6         -52,594            -3.3         -63,869            -3.8
Formaldehyde............................................             -40            -0.5            -187            -2.7            -227            -2.9
NOX.....................................................         -22,710            -1.9        -101,961           -12.1        -123,824           -13.3
PM2.5...................................................          -1,110            -1.9          -5,081           -11.1          -6,100           -12.1
SOX.....................................................          -6,080            -4.8         -26,933           -18.9         -32,282           -20.5
VOC.....................................................          -5,305            -2.2         -25,070           -11.9         -29,253           -13.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

(b) Model Year Lifetime Analysis
    In addition to the annual non-GHG emissions reductions expected 
from the final rules, EPA estimated the combined (downstream and 
upstream) non-GHG impacts for the lifetime of the impacted vehicles. 
Table VIII-13 shows the fleet-wide reductions of NOX, 
PM2.5 and SOX from the final program, relative to 
Alternative 1a, through the lifetime \762\ of heavy-duty vehicles. For 
the lifetime non-GHG reductions by vehicle categories, see Chapter 5 of 
the RIA.
---------------------------------------------------------------------------

    \762\ A lifetime of 30 years is assumed in MOVES.

  Table VIII-13--Lifetime Non-GHG Reductions Using Analysis Method B--
                    Summary for Model Years 2018-2029
                           [U.S. Short Tons] a
------------------------------------------------------------------------
                                                           Final program
            No-action alternative (baseline)             ---------------
                                                             1a (Flat)
------------------------------------------------------------------------
NOX.....................................................         549,881
    Downstream..........................................         277,644
    Upstream............................................         272,237
PM2.5...................................................          32,251
    Downstream \b\......................................           1,824
    Upstream............................................          30,427
SOX.....................................................         175,202
    Downstream..........................................           4,931
    Upstream............................................         170,272
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.
\b\ PM2.5 from tire wear and brake wear are included.

D. Air Quality Impacts of Non-GHG Pollutants

    Changes in emissions of non-GHG pollutants due to these rules will 
impact air quality. Information on current air quality and the results 
of our air quality modeling of the projected impacts of these rules are 
summarized in the following section. Additional information is 
available in Chapter 6 of the RIA.
(1) Current Concentrations of Non-GHG Pollutants
    Nationally, levels of PM2.5, ozone, NOX, 
SOX, CO and air toxics are declining.\763\ However, as of 
April 22, 2016, more than 125 million people lived in counties 
designated nonattainment for one or more of the NAAQS, and this figure 
does not include the people living in areas with a risk of exceeding a 
NAAQS in the future.\764\ Many Americans continue to be exposed to 
ambient concentrations of air toxics at levels which have the potential 
to cause adverse health effects.\765\ In addition, populations who 
live, work, or attend school near major roads experience elevated 
exposure concentrations to a wide range of air pollutants.\766\
---------------------------------------------------------------------------

    \763\ U.S. EPA, 2011. Our Nation's Air: Status and Trends 
through 2010. EPA-454/R-12-001. February 2012. Available at: http://www3.epa.gov/airtrends/2011/.
    \764\ Data come from Summary Nonattainment Area Population 
Exposure Report, current as of April 22, 2016 at: https://www3.epa.gov/airquality/greenbk/popexp.html and contained in Docket 
EPA-HQ-OAR-2014-0827.
    \765\ U.S. EPA. (2015) Summary of Results for the 2011 National-
Scale Assessment. https://www3.epa.gov/sites/production/files/2015-12/documents/2011-nata-summary-results.pdf.
    \766\ Health Effects Institute Panel on the Health Effects of 
Traffic-Related Air Pollution. (2010) Traffic-related air pollution: 
A critical review of the literature on emissions, exposure, and 
health effects. HEI Special Report 17. Available at http://www.healtheffects.org].
---------------------------------------------------------------------------

(a) Particulate Matter
    There are two primary NAAQS for PM2.5: An annual 
standard (12.0 micrograms per cubic meter ([mu]g/m\3\)) set in 2012 and 
a 24-hour standard (35 [mu]g/m\3\) set in 2006, and two secondary NAAQS 
for PM2.5: An annual standard (15.0 [mu]g/m\3\) set in 1997 
and a 24-hour standard (35 [mu]g/m\3\) set in 2006.
    There are many areas of the country that are currently in 
nonattainment for the annual and 24-hour primary PM2.5 
NAAQS. In 2005 the EPA designated 39 nonattainment areas for the 1997 
PM2.5 NAAQS.\767\ As of April 22, 2016, more than 23 million 
people lived in the 7 areas that are still designated as nonattainment 
for the 1997 annual PM2.5 NAAQS. These PM2.5

[[Page 73856]]

nonattainment areas are comprised of 33 full or partial counties. In 
December 2014 EPA designated 14 nonattainment areas for the 2012 annual 
PM2.5 NAAQS.\768\ In March 2015, EPA changed the initial 
designation from nonattainment to unclassifiable/attainment for four 
areas based on the availability of complete, certified 2014 air quality 
data showing these areas met the 2012 annual PM2.5 NAAQS. 
The EPA also changed the initial 2012 annual PM2.5 NAAQS 
designation from nonattainment to unclassifiable for the Louisville, 
Indiana-Kentucky area. \769\ As of April 22, 2016, 9 of these areas 
remain designated as nonattainment, and they are composed of 20 full or 
partial counties with a population of over 23 million. On November 13, 
2009 and February 3, 2011, the EPA designated 32 nonattainment areas 
for the 2006 24-hour PM2.5 NAAQS.\770\ As of April 22, 2016, 
16 of these areas remain designated as nonattainment for the 2006 24-
hour PM2.5 NAAQS, and they are composed of 46 full or 
partial counties with a population of over 32 million. In total, there 
are currently 24 PM2.5 nonattainment areas with a population 
of more than 39 million people.\771\
---------------------------------------------------------------------------

    \767\ 70 FR 19844 (April 14, 2005).
    \768\ EPA 2014. Fact Sheet: Final Area Designations for the 
Annual Fine Particle Standard. https://www3.epa.gov/pmdesignations/2012standards/final/20141218fs.pdf.
    \769\ https://www3.epa.gov/pmdesignations/2012standards/final/20150331fs.pdf.
    \770\ 74 FR 58688 (November 13, 2009) and 76 FR 6056 (February 
3, 2011).
    \771\ The 39 million total is calculated by summing, without 
double counting, the 1997, 2006 and 2012 PM2.5 
nonattainment populations contained in the Summary Nonattainment 
Area Population Exposure report (https://www3.epa.gov/airquality/greenbk/popexp.html). If there is a population associated with more 
than one of the 1997, 2006 and 2012 nonattainment areas, and they 
are not the same, then the larger of the populations is included in 
the sum.
---------------------------------------------------------------------------

    The EPA has already adopted many mobile source emission control 
programs that are expected to reduce ambient PM concentrations. As a 
result of these and other federal, state and local programs, the number 
of areas that fail to meet the PM2.5 NAAQS in the future is 
expected to decrease. However, even with the implementation of all 
current state and federal regulations, there are projected to be 
counties violating the PM2.5 NAAQS well into the future. 
States will need to meet the 2006 24-hour standards in the 2015-2019 
timeframe and the 2012 primary annual standard in the 2021-2025 
timeframe. The emission reductions and improvements in ambient 
PM2.5 concentrations from this action, which will take 
effect as early as model year 2018, will be helpful to states as they 
work to attain and maintain the PM2.5 NAAQS.\772\ The 
standards can assist areas with attainment dates in 2018 and beyond in 
attaining the NAAQS as expeditiously as practicable and may relieve 
areas with already stringent local regulations from some of the burden 
associated with adopting additional local controls.
---------------------------------------------------------------------------

    \772\ The final Phase 2 trailer standards and PM controls for 
APUs begin with model year 2018.
---------------------------------------------------------------------------

(b) Ozone
    The primary and secondary NAAQS for ozone are 8-hour standards with 
a level of 0.07 ppm. The most recent revision to the ozone standards 
was in 2015; the previous 8-hour ozone primary standard, set in 2008, 
had a level of 0.075 ppm. Final nonattainment designations for the 2008 
ozone standard were issued on April 30, 2012, and May 31, 2012.\773\ As 
of April 22, 2016, there were 44 ozone nonattainment areas for the 2008 
ozone NAAQS, composed of 216 full or partial counties, with a 
population of more than 120 million. In addition, EPA plans to finalize 
nonattainment areas for the 2015 ozone NAAQS in October 2017.
---------------------------------------------------------------------------

    \773\ 77 FR 30088 (May 21, 2012) and 77 FR 34221 (June 11, 
2012).
---------------------------------------------------------------------------

    States with ozone nonattainment areas are required to take action 
to bring those areas into attainment. The attainment date assigned to 
an ozone nonattainment area is based on the area's classification. The 
attainment dates for areas designated nonattainment for the 2008 8-hour 
ozone NAAQS are in the 2015 to 2032 timeframe, depending on the 
severity of the problem in each area. Nonattainment area attainment 
dates associated with areas designated for the 2015 NAAQS will be in 
the 2020-2037 timeframe, depending on the severity of the problem in 
each area.\774\
---------------------------------------------------------------------------

    \774\ https://www3.epa.gov/ozone-pollution/2015-ozone-naaqs-timelines.
---------------------------------------------------------------------------

    EPA has already adopted many emission control programs that are 
expected to reduce ambient ozone levels. As a result of these and other 
federal, state and local programs, 8-hour ozone levels are expected to 
improve in the future. However, even with the implementation of all 
current state and federal regulations, there are projected to be 
counties violating the ozone NAAQS well into the future. The emission 
reductions from this action, which will take effect as early as model 
year 2018, will be helpful to states as they work to attain and 
maintain the ozone NAAQS.\775\ The standards can assist areas with 
attainment dates in 2018 and beyond in attaining the NAAQS as 
expeditiously as practicable and may relieve areas with already 
stringent local regulations from some of the burden associated with 
adopting additional local controls.
---------------------------------------------------------------------------

    \775\ The final Phase 2 trailer standards begin with model year 
2018.
---------------------------------------------------------------------------

(c) Nitrogen Dioxide
    The EPA most recently completed a review of the primary NAAQS for 
NO2 in January 2010. There are two primary NAAQS for 
NO2: An annual standard (53 ppb) and a 1-hour standard (100 
ppb). The EPA promulgated area designations in the Federal Register on 
February 17, 2012. In this initial round of designations, all areas of 
the country were designated as ``unclassifiable/attainment'' for the 
2010 NO2 NAAQS based on data from the existing air quality 
monitoring network. The EPA and state agencies are working to establish 
an expanded network of NO2 monitors, expected to be deployed 
in the 2014-2017 time frame. Once three years of air quality data have 
been collected from the expanded network, the EPA will be able to 
evaluate NO2 air quality in additional 
locations.776 777
---------------------------------------------------------------------------

    \776\ U.S. EPA. (2012). Fact Sheet--Air Quality Designations for 
the 2010 Primary Nitrogen Dioxide (NO2) National Ambient 
Air Quality Standards. http://www3.epa.gov/airquality/nitrogenoxides/designations/pdfs/20120120FS.pdf.
    \777\ U.S. Environmental Protection Agency (2013). Revision to 
Ambient Nitrogen Dioxide Monitoring Requirements. March 7, 2013. 
http://www3.epa.gov/airquality/nitrogenoxides/pdfs/20130307fr.pdf.
---------------------------------------------------------------------------

(d) Sulfur Dioxide
    The EPA most recently completed a review of the primary 
SO2 NAAQS in June 2010. The current primary NAAQS for 
SO2 is a 1-hour standard of 75 ppb. The EPA finalized the 
initial area designations for 29 nonattainment areas in 16 states in a 
notice published in the Federal Register on August 5, 2013. In this 
first round of designations, EPA only designated nonattainment areas 
that were violating the standard based on existing air quality 
monitoring data provided by the states. The agency did not have 
sufficient information to designate any area as ``attainment'' or make 
final decisions about areas for which additional modeling or monitoring 
is needed (78 FR 47191, August 5, 2013). On March 2, 2015, the U.S. 
District Court for the Northern District of California accepted, as an 
enforceable order, an agreement between the EPA and Sierra Club and 
Natural Resources Defense Council to resolve litigation concerning the 
deadline for completing designations.\778\ The court's order directs 
the EPA to complete designations for all remaining

[[Page 73857]]

areas in the country in up to three additional rounds: The first round 
by July 2, 2016, the second round by December 31, 2017, and the final 
round by December 31, 2020.
---------------------------------------------------------------------------

    \778\ Sierra Club v. McCarthy, No. 3-13-cv-3953 (SI) (N.D. Cal. 
Mar. 2, 2015).
---------------------------------------------------------------------------

(e) Carbon Monoxide
    There are two primary NAAQS for CO: An 8-hour standard (9 ppm) and 
a 1-hour standard (35 ppm). The primary NAAQS for CO were retained in 
August 2011. There are currently no CO nonattainment areas; as of 
September 27, 2010, all CO nonattainment areas have been redesignated 
to attainment.
    The past designations were based on the existing community-wide 
monitoring network. EPA is making changes to the ambient air monitoring 
requirements for CO. The new requirements are expected to result in 
approximately 52 CO monitors operating near roads within 52 urban areas 
by January 2015 (76 FR 54294, August 31, 2011).
(f) Diesel Exhaust PM
    Because DPM is part of overall ambient PM and cannot be easily 
distinguished from overall PM, we do not have direct measurements of 
DPM in the ambient air. DPM concentrations are estimated using ambient 
air quality modeling based on DPM emission inventories. DPM emission 
inventories are computed as the exhaust PM emissions from mobile 
sources combusting diesel or residual oil fuel. DPM concentrations were 
recently estimated as part of the 2011 NATA.\779\ Areas with high 
concentrations are clustered in the Northeast, Great Lake States, 
California, and the Gulf Coast States and are also distributed 
throughout the rest of the U.S. The median DPM concentration calculated 
nationwide is 0.76 [mu]g/m\3\. Half of the DPM can be attributed to 
heavy-duty diesel vehicles.
---------------------------------------------------------------------------

    \779\ U.S. EPA (2015) 2011 National-Scale Air Toxics Assessment. 
https://www3.epa.gov/national-air-toxics-assessment/2011-nata-assessment-results#emissions.
---------------------------------------------------------------------------

(g) Air Toxics
    The most recent available data indicate that the majority of 
Americans continue to be exposed to ambient concentrations of air 
toxics at levels which have the potential to cause adverse health 
effects. The levels of air toxics to which people are exposed vary 
depending on where people live and work and the kinds of activities in 
which they engage, as discussed in detail in EPA's most recent Mobile 
Source Air Toxics Rule.\780\ According to the National Air Toxic 
Assessment (NATA) for 2011, mobile sources were responsible for 50 
percent of outdoor anthropogenic toxic emissions and were the largest 
contributor to cancer and noncancer risk from directly emitted 
pollutants.781 782 Mobile sources are also large 
contributors to precursor emissions which react to form air toxics. 
Formaldehyde is the largest contributor to cancer risk of all 71 
pollutants quantitatively assessed in the 2011 NATA. Mobile sources 
were responsible for more than 25 percent of primary anthropogenic 
emissions of this pollutant in 2011 and are major contributors to 
formaldehyde precursor emissions. Benzene is also a large contributor 
to cancer risk, and mobile sources account for almost 80 percent of 
ambient exposure. Over the years, EPA has implemented a number of 
mobile source and fuel controls which have resulted in VOC reductions, 
which also reduced formaldehyde, benzene and other air toxic emissions.
---------------------------------------------------------------------------

    \780\ U.S. Environmental Protection Agency (2007). Control of 
Hazardous Air Pollutants from Mobile Sources; Final Rule. 72 FR 
8434, February 26, 2007.
    \781\ U.S. EPA. (2015) 2011 NATA: Assessment Results. https://www3.epa.gov/national-air-toxics-assessment/2011-nata-assessment-results.
    \782\ NATA also includes estimates of risk attributable to 
background concentrations, which includes contributions from long-
range transport, persistent air toxics, and natural sources; as well 
as secondary concentrations, where toxics are formed via secondary 
formation. Mobile sources substantially contribute to long-range 
transport and secondarily formed air toxics.
---------------------------------------------------------------------------

(2) Impacts of the Rule on Projected Air Quality
    Along with reducing GHGs, the Phase 2 standards also have an impact 
on non-GHG, criteria and air toxic pollutant, emissions. As shown above 
in Section VIII.C, the standards will impact exhaust emissions of these 
pollutants from vehicles and will also impact emissions that occur 
during the refining and distribution of fuel (upstream sources). 
Reductions in emissions of NOX, VOC, PM2.5 and 
air toxics expected as a result of the Phase 2 standards will lead to 
improvements in air quality, specifically decreases in ambient 
concentrations of PM2.5, ozone, NO2 and air 
toxics, as well as better visibility and reduced deposition.
    Emissions and air quality modeling decisions are made early in the 
analytical process because of the time and resources associated with 
full-scale photochemical air quality modeling. As a result, the 
inventories used in the air quality modeling and the benefits modeling 
are different from the final emissions inventories presented in Section 
VIII.C. The air quality inventories and the final inventories are 
consistent in many ways, but there are some important differences. For 
example, in this final rulemaking, EPA is adopting Phase 1 and Phase 2 
requirements to control PM2.5 emissions from APUs installed 
in new tractors, so we do not expect increases in downstream 
PM2.5 emissions from the Phase 2 program; however, the air 
quality inventories do not reflect these requirements and therefore 
show increases in downstream PM2.5 emissions. Chapter 5 of 
the RIA has more detail on the differences between the air quality and 
final inventories. The results of our air quality modeling of the 
criteria pollutant and air toxics impacts of the Phase 2 standards are 
summarized in the RIA and presented in more detail in Appendix 6A to 
the RIA.

IX. Economic and Other Impacts

    This section presents the costs, benefits and other economic 
impacts of the Phase 2 standards. It is important to note that NHTSA's 
fuel consumption standards and EPA's GHG standards will both be in 
effect, and each will lead to average fuel efficiency increases and GHG 
emission reductions.
    The net benefits of the Phase 2 standards consist of the effects of 
the program on:

 vehicle program costs (costs of complying with the vehicle 
CO2 and fuel consumption standards)
 changes in fuel expenditures associated with reduced fuel use 
resulting from more efficient vehicles and increased fuel use 
associated with the ``rebound'' effect, both of which result from the 
program
 economic value of reductions in GHGs
 economic value of reductions in non-GHG pollutants
 costs associated with increases in noise, congestion, and 
crashes resulting from increased vehicle use
 savings in drivers' time from less frequent refueling
 benefits of increased vehicle use associated with the 
``rebound'' effect
 economic value of improvements in U.S. energy security

    The benefits and costs of these rules are analyzed using 3 percent 
and 7 percent discount rates, consistent with current OMB 
guidance.\783\ These rates

[[Page 73858]]

are intended to represent consumers' preference for current over future 
consumption (3 percent), and the real rate of return on private 
investment (7 percent) which indicates the opportunity cost of capital. 
However, neither of these rates necessarily represents the discount 
rate that individual decision-makers use.
---------------------------------------------------------------------------

    \783\ The range of Social Cost of Carbon (SC-CO2) 
values uses several discount rates because the literature shows that 
the SC-CO2 is quite sensitive to assumptions about the 
discount rate, and because no consensus exists on the appropriate 
rate to use in an intergenerational context (where costs and 
benefits are incurred by different generations). Refer to Section 
IX.F.1 for more information.
---------------------------------------------------------------------------

    The program may also have other economic effects that are not 
included here. As discussed in Sections III through VI of this Preamble 
and in Chapter 2 of the RIA, the technology cost estimates developed 
here take into account the costs to hold other vehicle attributes, such 
as size and performance, constant. With these assumptions, and because 
welfare losses represent monetary estimates of how much buyers would 
have to be compensated to be made as well off as they would have been 
in the absence of this regulation,\784\ price increases for new 
vehicles measure the welfare losses to the vehicle buyers.\785\ If the 
full technology cost gets passed along to the buyer as an increase in 
price, the technology cost thus measures the primary welfare loss of 
the standards, including impacts on buyers. Increasing fuel efficiency 
would have to lead to other changes in the vehicles that buyers find 
undesirable for there to be additional welfare losses that are not 
included in the technology costs.
---------------------------------------------------------------------------

    \784\ This approach describes the economic concept of 
compensating variation, a payment of money after a change that would 
make a consumer as well off after the change as before it. A related 
concept, equivalent variation, estimates the income change that 
would be an alternative to the change taking place. The difference 
between them is whether the consumer's point of reference is her 
welfare before the change (compensating variation) or after the 
change (equivalent variation). In practice, these two measures are 
typically very close together.
    \785\ Indeed, it is likely to be an overestimate of the loss to 
the consumer, because the buyer has choices other than buying the 
same vehicle with a higher price; she could choose a different 
vehicle, or decide not to buy a new vehicle. The buyer would choose 
one of those options only if the alternative involves less loss than 
paying the higher price. Thus, the increase in price that the buyer 
faces would be the upper bound of loss of consumer welfare, unless 
there are other changes to the vehicle due to the fuel efficiency 
improvements that make the vehicle less desirable to consumers.
---------------------------------------------------------------------------

    As the 2012-2016 and 2017-2025 light-duty GHG/CAFE rules discussed, 
if other vehicle attributes are not held constant, then the technology 
cost estimates do not capture the losses to vehicle buyers associated 
with these changes.\786\ The light-duty rules also discussed other 
potential issues that could affect the calculation of the welfare 
impacts of these types of changes, such as aspects of buyers' behavior 
that might affect the demand for technology investments, uncertainty in 
buyers' investment horizons, and the rate at which truck owner's trade 
off higher vehicle purchase price against future fuel savings.
---------------------------------------------------------------------------

    \786\ Environmental Protection Agency and Department of 
Transportation, ``Light-Duty Vehicle Greenhouse Gas Emission 
Standards and Corporate Average Fuel Economy Standards; Final 
Rule,'' 75 FR 25324, May 7, 2010, especially Sections III.H.1 
(25510-25513) and IV.G.6 (25651-25657); Environmental Protection 
Agency and Department of Transportation, ''2017 and Later Model Year 
Light-Duty Vehicle Greenhouse Gas Emissions and Corporate Average 
Fuel Economy Standards; Final Rule,'' 77 FR 62624, October 15, 2012, 
especially Sections III.H.1 (62913-62919) and IV.G.5.a (63102-
63104).
---------------------------------------------------------------------------

    Where possible, we identify the uncertain aspects of these economic 
impacts and attempt to quantify them (e.g., sensitivity ranges 
associated with quantified and monetized GHG impacts; range of dollar-
per-ton values to monetize non-GHG health benefits; uncertainty with 
respect to learning and markups). The agencies have examined the 
sensitivity of oil prices on fuel expenditures; results of this 
sensitivity analysis can be found in Chapter 8 of the RIA. NHTSA's EIS 
also characterizes the uncertainty in economic impacts associated with 
the HD national program. For other impacts, however, there is 
inadequate information to inform a thorough, quantitative assessment of 
uncertainty. EPA and NHTSA continue to work toward developing a 
comprehensive strategy for characterizing the aggregate impact of 
uncertainty in key elements of its analyses and we will continue to 
work to refine these uncertainty analyses in the future as time and 
resources permit.
    This and other sections of the Preamble address Section 317 of the 
Clean Air Act on economic analysis. Section IX.L addresses Section 321 
of the Clean Air Act on employment analysis. The total monetized 
benefits and costs of the program are summarized in Section IX.K for 
the final program and in Section X for all alternatives.
    The agencies sought comment on numerous aspects of the analyses 
presented in this section, such as the potential omissions of costs or 
benefits, additional impacts of the standards on vehicle attributes and 
performance, and the quantification of uncertainty. Responses to 
comments on specific aspects of the analysis are addressed as 
appropriate in the relevant sections below, and in Sections III through 
VI of this Preamble as they relate to certain technologies. Further 
detail can be found in Section 11 of the RTC.

A. Conceptual Framework

    The HD Phase 2 standards will implement both the 2007 Energy 
Independence and Security Act requirement that NHTSA establish fuel 
efficiency standards for medium- and heavy-duty vehicles and the Clean 
Air Act requirement that EPA adopt technology-based standards to 
control pollutant emissions from motor vehicles and engines 
contributing to air pollution that endangers public health and welfare. 
NHTSA's statutory mandate is intended to further the agency's long-
standing goals of reducing U.S. consumption and imports of petroleum 
energy to improve the nation's energy security.
    From an economics perspective, government actions to improve our 
nation's energy security and to protect our nation from the potential 
threats of climate change address ``externalities,'' or economic 
consequences of decisions by individuals and businesses that extend 
beyond those who make these decisions. For example, users of 
transportation fuels increase the entire U.S. economy's risk of having 
to make costly adjustments due to rapid increases in oil prices, but 
these users generally do not consider such costs when they decide to 
consume more fuel.
    Similarly, consuming transportation fuel also increases emissions 
of greenhouse gases and other more localized air pollutants that occur 
when fuel is refined, distributed, and consumed. Some of these 
emissions increase the likelihood and severity of potential climate-
related economic damages, and others cause economic damages by 
adversely affecting human health. The need to address these external 
costs and other adverse effects provides a well-established economic 
rationale that supports the statutory direction given to government 
agencies to establish regulatory programs that reduce the magnitude of 
these adverse effects at reasonable costs.
    The Phase 2 standards will require manufacturers of new heavy-duty 
vehicles, including trailers (HDVs), to improve the fuel efficiency of 
the products that they produce. As HDV users purchase and operate these 
new vehicles, they will consume significantly less fuel, in turn 
reducing U.S. petroleum consumption and imports as well as emissions of 
GHGs and other air pollutants. Thus, as a consequence of the agencies' 
efforts to meet our statutory obligations to improve U.S. energy 
security and EPA's obligation to issue standards ``to regulate 
emissions of the deleterious pollutant . . . from motor vehicles'' that 
endangers public health and welfare,\787\

[[Page 73859]]

the fuel efficiency and GHG emission standards will also reduce HDV 
operators' outlays for fuel purchases. These fuel savings are one 
measure of the final rule's effectiveness in promoting NHTSA's 
statutory goal of conserving energy, as well as EPA's obligation under 
section 202(a)(1) and (2) of the Clean Air Act to assess the cost of 
standards. Although these savings are not the agencies' primary 
motivation for adopting higher fuel efficiency standards, these 
substantial fuel savings represent significant additional economic 
benefits of these rules.
---------------------------------------------------------------------------

    \787\ State of Massachusetts v. EPA, 549 U.S. at 533.
---------------------------------------------------------------------------

    Potential savings in fuel costs appear to offer HDV buyer's strong 
incentives to pay higher prices for vehicles that feature technology or 
equipment that reduces fuel consumption. These potential savings also 
appear to offer HDV manufacturers similarly strong incentives to 
produce more fuel-efficient vehicles. Economic theory suggests that 
interactions between vehicle buyers and sellers in a normally-
functioning competitive market would lead HDV manufacturers to 
incorporate all technologies that contribute to lower net costs into 
the vehicles they offer, and buyers to purchase them willingly. 
Nevertheless, many readily available technologies that appear to offer 
cost-effective increases in HDV fuel efficiency (when evaluated over 
their expected lifetimes using conventional discount rates) have not 
been widely adopted, despite their potential to repay buyers' initial 
investments rapidly.
    This economic situation is commonly known as the ``energy 
efficiency gap'' or ``energy paradox.'' This situation is perhaps more 
challenging to understand with respect to the heavy-duty sector versus 
the light-duty vehicle sector. Unlike light-duty vehicles--which are 
purchased and used mainly by individuals and households--the vast 
majority of HDVs are purchased and operated by profit-seeking 
businesses for which fuel costs represent a substantial operating 
expense. We asked for comments on our hypotheses about causes of the 
gap, as well as data or other information that can inform our 
understanding of why this situation seems to persist. The California 
Air Resources Board, CALSTART, Consumer Federation of America, 
Institute for Policy Integrity at NYU School of Law, and International 
Council on Clean Transportation supported, either in whole or in part, 
the agencies' arguments for potential barriers to market adoption. 
Caterpillar Inc. et al., Competitive Enterprise Institute (CEI), 
Randall Lutter, Brian Mannix, NAFA Fleet Management Association (NAFA), 
Owner-Operator Independent Drivers Association (OOIDA), Truck Renting 
and Leasing Association (TRALA), and Utility Trailer Manufacturing 
Company express skepticism or raise concerns about the agencies' 
discussion. The skeptical comments, discussed in more depth in context 
below, generally find it implausible that regulations can save money 
for profit-seeking businesses. If the savings were real, they argue, 
then private markets would have adopted these technologies without 
regulations; the agencies must therefore have exaggerated the benefits 
or underestimated the costs of the standards. Problems exist not in 
private market operations, they claim, but rather in the economic 
analysis of those operations.
    The economic analysis of these standards is based on the 
engineering analysis of the costs and effectiveness of the 
technologies. The agencies have detailed their findings on costs and 
effectiveness in Preamble Sections III, IV, V, and VI, and RIA Chapter 
2. If these cost and effectiveness estimates are correct, and if the 
agencies have not omitted key costs or benefits, then the efficiency 
gap exists, even if it seems implausible to some. As will be discussed 
further below, comments that raise issues with that technical analysis, 
such as concerns about maintenance and reliability costs of the 
technologies, present possible reasons that the gap is not as large as 
the agencies have found, and are discussed in the cost and 
effectiveness sections mentioned above. Comments that question the 
explanations provided for the gap without addressing the cost and 
effectiveness analyses do not provide evidence of an absence of the 
gap. Explaining why the gap exists is a separate and difficult 
challenge from observing the existence of the gap, because of the 
difficulties involved in developing tests of the different possible 
explanations. As discussed below, there is very little empirical 
evidence on behaviors that might lead to the gap, even while there 
continues to be substantial evidence, via the cost and effectiveness 
analysis, of the gap's existence. On the basis of that evidence, the 
agencies believe that a significant number of fuel efficiency improving 
technologies would remain far less widely adopted in the absence of 
these standards.
    Economic research offers several possible explanations for why the 
prospect of these apparent savings might not lead HDV manufacturers and 
buyers to adopt technologies that would be expected to reduce HDV 
operating costs. Some of these explanations involve failures of the HDV 
market for reasons other than the externalities caused by producing and 
consuming fuel. Examples include situations where information about the 
performance of fuel economy technologies is incomplete, costly to 
obtain, or available only to one party to a transaction (or 
``asymmetrical''), as well as behavioral rigidities in either the HDV 
manufacturing or HDV-operating industries, such as standardized or 
inflexibly administered operating procedures, or requirements of other 
regulations on HDVs. Examples that do not involve market failures 
include possible effects on the performance, reliability, carrying 
capacity, maintenance requirements of new technology under the demands 
of everyday use, or transaction or adjustment costs. We note again that 
these and other hypotheses are presented as potential explanations of 
the finding of an efficiency gap based on an engineering analysis. They 
are not themselves the basis for regulation.
    In the HD Phase 1 rulemaking (which, in contrast to these 
standards, did not apply to trailers), and in the Phase 2 NPRM, the 
agencies raised various hypotheses that might explain this energy 
efficiency gap or paradox.
     Imperfect information in the new vehicle market: 
Information available to prospective buyers about the effectiveness of 
some fuel-saving technologies for new vehicles may be inadequate or 
unreliable. If reliable information on their effectiveness in reducing 
fuel consumption is unavailable or difficult to obtain, HDV buyers will 
understandably be reluctant to pay higher prices to purchase vehicles 
equipped with unproven technologies.
    Some commenters argue that this explanation implies implausibly 
that the agencies have information that those with profit motives do 
not, and that EPA's SmartWay Program has already served the function of 
sharing public information with the private sector. Other commenters 
agree with the agencies that imperfect information is a potential 
market barrier.
    As discussed in the NPRM, one common theme from recent research 
\788\

[[Page 73860]]

is the inability of HDV buyers to obtain reliable information about the 
fuel savings, reliability, and maintenance costs of technologies that 
improve fuel efficiency. See 80 FR 40436. In the trucking industry, the 
performance of fuel-saving technology is likely to depend on many firm-
specific attributes, including the intensity of HDV use, the typical 
distance and routing of HDV trips, driver characteristics, road 
conditions, regional geography and traffic patterns. As a result, 
businesses that operate HDVs have strong preferences for testing fuel-
saving technologies ``in-house'' because they are concerned that their 
patterns of vehicle use may lead to different results from those 
reported in published information. Businesses with less capability to 
do in-house testing often seek information from peers, yet often remain 
skeptical of its applicability due to differences in the nature of 
their operations.
---------------------------------------------------------------------------

    \788\ Klemick, Heather, Elizabeth Kopits, Keith Sargent, and Ann 
Wolverton (2015). ``Heavy-Duty Trucking and the Energy Efficiency 
Paradox: Evidence form Focus Groups and Interviews.'' Transportation 
Research Part A 77: 154-166, Docket EPA-HQ-OAR-2014-0827; Roeth, 
Mike, Dave Kircher, Joel Smith, and Rob Swim (2013). ``Barriers to 
the Increased Adoption of Fuel Efficiency Technologies in the North 
American On-Road Freight Sector.'' NACFE report for the 
International Council on Clean Transportation, Docket EPA-HQ-OAR-
2014-0827-0084; Aarnink, Sanne, Jasper Faber, and Eelco den Boer 
(2012). ``Market Barriers to Increased Efficiency in the European 
On-road Freight Sector.'' CE Delft report for the International 
Council on Clean Transportation, Docket EPA-HQ-OAR-2014-0827-0076.
---------------------------------------------------------------------------

     Imperfect information in the resale market: Buyers in the 
used vehicle market may not be willing to pay adequate premiums for 
more fuel efficient vehicles when they are offered for resale to ensure 
that buyers of new vehicles can recover the remaining value of their 
original investment in higher fuel efficiency. The prospect of an 
inadequate return on their original owners' investments in higher fuel 
efficiency may contribute to the short payback periods that buyers of 
new vehicles appear to demand.\789\
---------------------------------------------------------------------------

    \789\ Committee to Assess Fuel Economy Technologies for Medium- 
and Heavy-Duty Vehicles; National Research Council; Transportation 
Research Board (2010). ``Technologies and Approaches to Reducing the 
Fuel Consumption of Medium- and Heavy-Duty Vehicles,'' (hereafter, 
``NAS 2010''). Washington, DC The National Academies Press. 
Available electronically from the National Academies Press Web site 
at http://www.nap.edu/catalog.php?record_id=12845 (accessed 
September 10, 2010), Docket EPA-HQ-OAR-2014-0827-0122.
---------------------------------------------------------------------------

    CEI rejects this hypothesis, asserting that buyers in this market 
do consider the value of technologies on used vehicles; other 
commenters support this possibility.
    The recent research cited above (Klemick et al. 2015, Roeth et al. 
2013, Aarnink et al. 2012) found mixed evidence for imperfect 
information in the market for used HDVs. On the one hand, some studies 
noted that fuel-saving technology is often not appreciated in the used 
vehicle market, because of imperfect information about its benefits, or 
greater mistrust of its performance among buyers in the used vehicle 
market than among buyers of new vehicles. When buyers of new vehicles 
considered features that would affect value in the secondary market, 
those features were rarely related to fuel economy. In addition, some 
used-vehicle buyers might have a larger ``knowledge gap'' than new-
vehicle buyers. In other cases, the lack of interest might be due to 
the intended use of the used HDVs, which may not reward the presence of 
certain fuel-saving technologies. In other cases, however, fuel-saving 
technology can lead to a premium in the used market, as for instance to 
meet the more stringent requirements for HDVs operating in California.
     Principal-agent problems causing split incentives: An HDV 
buyer may not be directly responsible for its future fuel costs, or the 
individual who will be responsible for fuel costs may not participate 
in the HDV purchase decision. In these cases, the signal to invest in 
higher fuel efficiency normally provided by savings in fuel costs may 
not be transmitted effectively to HDV buyers, and the incentives of HDV 
buyers and fuel buyers will diverge, or be ``split.'' The trailers 
towed by heavy-duty tractors, which are typically not supplied by the 
tractor manufacturer or seller, present an obvious potential situation 
of split incentives that was not addressed in the HD Phase 1 
rulemaking, but which may apply in this rulemaking. If there is 
inadequate pass-through of price signals from trailer users to their 
buyers, then low adoption of fuel-saving technologies may result.
    CEI argues that, even if these split incentives existed, vehicle 
purchasers still might not invest in fuel-saving technologies due to 
capital constraints. As discussed below, capital constraints may be an 
issue for smaller companies, but they do not appear to be a significant 
concern for larger companies. Mr. Lutter provides a working paper \790\ 
in which the authors do not find a statistically significant or 
negative relationship when the box trailer has different ownership than 
the tractor, a result that does not support evidence of the split-
incentives problem between tractors and trailers. As the papers below 
discuss, the split-incentives problem can take more forms than the 
difference in ownership between tractors and box trailers examined in 
this comment.
---------------------------------------------------------------------------

    \790\ Fraas, Art, Randall Lutter, Zachary Porter, and Alexander 
Wallace (2016). ``The Energy Paradox and the Adoption of Energy-
Saving Technologies in the Trucking Industry.'' Working Paper, 
Mercatus Center, George Mason University, Docket EPA-HQ-OAR-2014-
0827-1879.
---------------------------------------------------------------------------

    Other recent research identifies split incentives, or principal-
agent problems, as a potential barrier to technology adoption. For 
instance, Vernon and Meier (2012) estimate that 23 percent of trailers 
may be exposed to split incentives due to businesses that own and lease 
trailers to HDV operators not having an incentive to invest in trailer-
specific fuel-saving technology.\791\ They also estimate that 5 percent 
of HDV fuel use is subject to split incentives that arise when the firm 
paying fuel costs does not make the tractor investment decision (e.g., 
because a carrier subcontracts to an owner-operator but still pays for 
fuel). As CEI points out, in the case of a split incentive when the 
driver is not responsible for paying fuel costs, the owner is the 
principal who seeks fuel savings, and the driver is the agent with 
potentially low incentive to provide those savings; there are a number 
of potential sources of inefficiency in fuel use, though not all of 
them are expected to result in underinvestment in fuel-saving 
technologies. Vernon and Meier (2012) do not quantify the financial 
significance of these problems.
---------------------------------------------------------------------------

    \791\ Vernon, David and Alan Meier (2012). ``Identification and 
quantification of principal-agent problems affecting energy 
efficiency investments and use decisions in the trucking industry.'' 
Energy Policy, 49(C), pp. 266-273, Docket EPA-HQ-OAR-2014-0827-0090.
---------------------------------------------------------------------------

    Klemick et al. (2015), Aarnink et al. (2012), and Roeth et al. 
(2013) provide mixed evidence on the severity of the split-incentive 
problem. Focus groups often identify diverging incentives between 
drivers and the decision-makers responsible for purchasing vehicles. 
Aarnink et al. (2012) and Roeth et al. (2013) cite examples of split 
incentives involving trailers and fuel surcharges, although the latter 
also cites other examples where these same issues do not lead to split 
incentives. In an effort to minimize problems that can arise from split 
incentives, many businesses that operate HDVs also train drivers in the 
use of specific technologies or to modify their driving behavior in 
order to improve fuel efficiency, while some also offer financial 
incentives to their drivers to conserve fuel. All of these options can 
help to reduce the split incentive problem.
     Uncertainty about future fuel cost savings: HDV buyers may 
be uncertain about future fuel prices, or about maintenance costs and 
reliability of some fuel efficiency technologies. In contrast, the 
costs of fuel-saving technologies are immediate. If buyers

[[Page 73861]]

are loss-averse, they may react to this uncertainty by underinvesting 
in technologies to improve fuel economy. In this situation, potential 
variability about buyers' expected returns on capital investments to 
achieve higher fuel efficiency may shorten the payback period--the time 
required to repay those investments--they demand in order to make them.
    Various commenters support this hypothesis. The CEI draws on the 
experience of nitrogen oxides (NOX) regulations from 2004 
and 2007 to support its arguments. As discussed more below, the 
NOX standards are unlikely to provide much, if any, 
precedential value for the GHG/fuel economy standards. Other commenters 
raise questions related to uncertainty about future costs for fuel and 
maintenance, as well as about the reliability of new technology that 
could result in costly downtime. Section IX.D. below discusses 
maintenance expenditures under these standards. These examples 
illustrate the problem of uncertain or unreliable information about the 
actual performance of fuel efficiency technology discussed above. Roeth 
et al. (2013) and Klemick et al. (2015) both document the short payback 
periods that HDV buyers require on their investments--usually about 2 
years--which may be partly attributable to these uncertainties.
     Adjustment and transactions costs: Potential resistance to 
new technologies--stemming, for example, from drivers' reluctance or 
slowness to adjust to changes in the way vehicles operate--may slow or 
inhibit new technology adoption. If a conservative approach to new 
technologies leads HDV buyers to adopt them slowly, then successful new 
technologies will be adopted over time without market intervention, but 
only with potentially significant delays in achieving the fuel saving, 
environmental, and energy security benefits they offer. There also may 
be costs associated with training drivers to realize potential fuel 
savings enabled by new technologies, or with accelerating fleet 
operators' scheduled fleet turnover and replacement to hasten their 
acquisition of vehicles equipped with these technologies. These factors 
might present real resource costs to firms that are not reflected in a 
typical engineering analysis.
    CEI argues that these costs are normal aspects of the innovation 
process, and competition continually drives firms to innovate in most 
industries. As discussed below, innovation is not always a continual 
and smooth response to competition as CEI suggests.
    Klemick et al. (2015), Roeth et al. (2013), and Aarnink et al. 
(2012) provide some support for the view that adjustment and 
transactions costs may impede HDV buyers from investing in higher fuel 
efficiency. These studies note that HDV buyers are less likely to 
select new technology when it is not available from their preferred 
manufacturers. Some technologies are only available as after-market 
additions, which can add other costs to adopting them.
     Driver acceptance of new equipment or technologies as a 
barrier to their adoption. HDV driver turnover is high in the U.S., and 
businesses that operate HDVs are concerned about retaining their best 
drivers. Therefore, they may avoid technologies that require 
significant new training or adjustments in driver behavior.
    NAFA Fleet Management Association states that the standards will 
increase pressure on already strained driver and technician resources. 
The agencies understand that the industry experiences a great deal of 
driver turnover; we do not know how the standards will affect that 
turnover. Changes to vehicles that require some changes in driver 
behavior may increase driver turnover. For instance, drivers who prefer 
manual transmissions may respond poorly to vehicles with automatic 
transmissions. On the other hand, the switch to automatic transmissions 
may facilitate entry of new drivers who no longer need to learn as much 
about shifting.
    For some technologies that can be used to meet these standards, 
such as automatic tire inflation systems, training costs are likely to 
be minimal. Other technologies, such as stop-start systems, may require 
drivers to adjust their expectations about vehicle operation, and it is 
difficult for the agencies to anticipate how drivers will respond to 
such changes.\792\
---------------------------------------------------------------------------

    \792\ The distinction between simply requiring drivers (or 
mechanics) to adjust their expectations and compromises in vehicle 
performance or utility is subtle. While the former may not impose 
significant compliance costs in the long run, the latter would 
represent additional economic costs of complying with the standard.
---------------------------------------------------------------------------

     Constraints on access to capital for investment. If buyers 
of new vehicles have limited funds available, then they must choose 
between investing in fuel-saving technology and other vehicle 
technologies or attributes.
    CEI states that investments require tradeoffs: Investment in fuel 
economy crowds out other investments. There would be tradeoffs in 
purchasing choices if capital markets are constrained, and fuel-saving 
technologies do not provide returns sufficient to achieve the hurdle 
rates that the buyers require. Klemick et al. (2015) did not find 
capital constraints to be a problem for the medium- and large-sized 
businesses participating in their study. On the other hand, Roeth et 
al. (2013) noted that access to capital can be a significant challenge 
to smaller or independent businesses, and that price is always a 
concern to buyers. Section XIV.D. discusses the agencies' outreach to 
small businesses to learn about their special circumstances. These are 
reflected in various flexibilities for small businesses in the 
regulations.
     ``Network externalities,'' where the benefits to new users 
of a technology depend on how many others have already adopted it. If 
the value of a technology increases with increasing adoption, then it 
can be difficult for the adoption process to begin: Each potential 
adopter has an incentive to wait for others to adopt before making the 
investment. If all adopters wait for others, then adoption may not 
happen.
    One example where network externalities seem likely to arise is the 
market for natural gas-fueled HDVs: The limited availability of 
refueling stations may reduce potential buyers' willingness to purchase 
natural gas-fueled HDVs, while the small number of such HDVs in use 
does not provide sufficient economic incentive to construct more 
natural gas refueling stations. Some businesses that operate HDVs may 
also be concerned about the difficulty in locating repair facilities or 
replacement parts, such as single-wide tires, wherever their vehicles 
operate. When a technology has been widely adopted, then it is likely 
to be serviceable even in remote or rural places, but until it becomes 
widely available, its early adopters may face difficulties with repairs 
or replacements. By accelerating the widespread adoption of these 
technologies, these standards may assist in overcoming these 
difficulties.
    Consumer Federation of America states that network externalities 
are a potentially important barrier to adoption of fuel-saving 
technologies.
     First-mover disadvantage. Many manufacturers prefer to 
observe the market and follow other manufacturers rather than be the 
first to market with a specific technology. The ``first-mover 
disadvantage'' has been recognized in other research where the ``first-
mover'' pays a higher proportion of the costs of developing technology, 
but loses the long-term advantage when other

[[Page 73862]]

businesses follow quickly.\793\ In this way, there may be barriers to 
innovation on the supply side that result in lower adoption rates of 
fuel-efficiency technology than would be optimal.
---------------------------------------------------------------------------

    \793\ Blumstein, Carl and Margaret Taylor (2013). ``Rethinking 
the Energy-Efficiency Gap: Producers, Intermediaries, and 
Innovation,'' Energy Institute at Haas Working Paper 243, University 
of California at Berkeley, Docket EPA-HQ-OAR-2014-0827-0075; Tirole, 
Jean (1998). The Theory of Industrial Organization. Cambridge, MA: 
MIT Press, pp.400, 402, Docket EPA-HQ-OAR-2014-0827-0089. This 
first-mover disadvantage must be large enough to overcome the 
potential incentive for first movers to earn unusually high but 
temporary profit levels.
---------------------------------------------------------------------------

    Several commenters support the existence of the first-mover 
disadvantage. Roeth et al. (2013) noted that HDV buyers often prefer to 
have technology or equipment installed by their favored original 
equipment manufacturers. However, some technologies may not be 
available through these preferred sources, or may be available only as 
after-market installations from third parties (Aarnink et al. 2012, 
Roeth et al. 2013). Manufacturers may be hesitant to offer technologies 
for which there is not strong demand, especially if the technologies 
require significant research and development expenses and other costs 
of bringing the technology to a market of uncertain demand. Roeth et 
al. (2013) noted that it can take years, and sometimes as much as a 
decade, for a specific technology to become available from all 
manufacturers.
    As mentioned above, the Competitive Enterprise Institute argues 
that EPA regulations on nitrogen oxides (NOX and other 
pollutants from heavy duty engines in the 2000s hindered development of 
fuel-saving technologies, in part because the technologies increased 
fuel consumption, and in part because, if manufacturers invested in 
NOX controls, they could not invest in reducing fuel 
consumption. The agencies do not find these potential explanations 
compelling. Most obviously, the NOX and other standards do 
not provide a useful analogy for industry response to the GHG/fuel 
efficiency standards, because those standards imposed costs without 
returning fuel savings to operators. In addition, as the discussion of 
technology cost and effectiveness indicates, technologies that are not 
in widespread use seem to be available to reduce fuel consumption with 
reasonable payback periods. Finally, the agencies consider it possible 
to reduce NOX in the presence of GHG controls, and to reduce 
GHG emissions in the presence of NOX controls; the cost 
analysis for this rulemaking accounts for achieving NOX 
emissions standards. See also RTC Sections 11.2.2.3 and 11.7.2.
    In summary, the agencies recognize that businesses that operate 
HDVs are under competitive pressure to reduce operating costs, which 
should compel HDV buyers to identify and rapidly adopt cost-effective 
fuel-saving technologies. Outlays for labor and fuel generally 
constitute the two largest shares of HDV operating costs, depending on 
the price of fuel, distance traveled, type of HDV, and commodity 
transported (if any), so businesses that operate HDVs face strong 
incentives to reduce these costs.794 795
---------------------------------------------------------------------------

    \794\ American Transportation Research Institute, An Analysis of 
the Operational Costs of Trucking, September 2013 (Docket ID: EPA-
HQ-OAR-2014-0827-0512).
    \795\ Transport Canada, Operating Cost of Trucks, 2005. See 
http://www.tc.gc.ca/eng/policy/report-acg-operatingcost2005-2005-e-2-1727.htm, accessed on July 16, 2010 (Docket ID: EPA-HQ-OAR-2014-
0827-0070).
---------------------------------------------------------------------------

    However, the relatively short payback periods that buyers of new 
HDVs appear to require suggest that some combination of the factors 
cited above impedes this process. Markets for both new and used HDVs 
may face these problems, although it is difficult to assess empirically 
the degree to which they actually do. Even if the benefits from 
widespread adoption of fuel-saving technologies exceed their costs, 
their use may remain limited or spread slowly because their early 
adopters bear a disproportionate share of those costs. In this case, as 
CFA says in its comments, these standards may help to overcome such 
barriers by ensuring that these measures will be widely adopted.
    Providing information about fuel-saving technologies, offering 
incentives for their adoption, and sharing HDV operators' real-world 
experiences with their performance through voluntary programs such as 
EPA's SmartWay Transport Partnership should assist in the adoption of 
new cost-saving technologies. Nevertheless, other barriers that impede 
the diffusion of new technologies are likely to remain. Buyers who are 
willing to experiment with new technologies expect to find cost 
savings, but those savings may be difficult to verify or replicate. As 
noted previously, because benefits from employing these technologies 
are likely to vary with the characteristics of individual routes and 
traffic patterns, buyers of new HDVs may find it difficult to identify 
or verify the effects of fuel-saving technologies in their operations. 
Risk-averse buyers may also avoid new technologies out of concerns over 
the possibility of inadequate returns on their investments, or with 
other possible adverse impacts.
    As various commenters note, competitive pressures in the HDV 
freight transport industry can provide a strong incentive to reduce 
fuel consumption and improve environmental performance. Nevertheless, 
HDV manufacturers may delay in investing in the development and 
production of new technologies, instead waiting for other manufacturers 
to bear the initial risks of those investments. In addition, not every 
HDV operator has the requisite ability or interest to access and 
utilize the technical information, or the resources necessary to 
evaluate this information within the context of his or her own 
operations.
    As discussed previously, whether the technologies available to 
improve HDVs' fuel efficiency would be adopted widely in the absence of 
the program is challenging to assess. To the extent that these 
technologies would be adopted in its absence, neither their costs nor 
their benefits should be attributed to the program.
    The agencies will continue to explore reasons for the slow adoption 
of readily available and apparently cost-effective technologies for 
improving fuel efficiency.

B. Vehicle-Related Costs Associated With the Program

(1) Technology Cost Methodology
(a) Direct Manufacturing Costs
    The direct manufacturing costs (DMCs) used throughout this analysis 
are derived from several sources. Many of the tractor, vocational and 
trailer DMCs can be sourced to the Phase 1 rule which, in turn, were 
sourced largely from a contracted study by ICF International for 
EPA.\796\ We have updated those costs by converting them to 2013 
dollars, as described in Section IX.B.1.e below, and by continuing the 
learning effects described in the Phase 1 rule and in Section IX.B.1.c 
below. The new tractor, vocational and trailer costs can be sourced to 
a more recent study conducted by Tetra Tech under contract to 
NHTSA.\797\ The cost methodology used by Tetra Tech was to estimate 
retail costs and work backward from there to derive a DMC for each 
technology. The agencies did not agree with the approach used by Tetra 
Tech

[[Page 73863]]

to move from retail cost to DMC as the approach was to simply divide 
retail costs by 2 and use the result as a DMC. Our research, discussed 
below, suggests that a divisor of 2 is too high. Therefore, where we 
have used a Tetra Tech derived retail estimate, we have divided by our 
researched markups to arrive at many of the DMCs used in this analysis. 
In this way, the agencies have used an approach consistent with past 
GHG/CAFE/fuel consumption rules by dividing estimated retail prices by 
our estimated retail price equivalent (RPE) markups to derive an 
appropriate DMC for each technology. We describe our RPEs in Section 
IX.B.1.b, below. Importantly, nearly all of the technology costs used 
in the final analysis are identical to those used in the proposal, 
except for updating those costs from 2012 dollars to 2013 dollars. 
Notable changes are the costs for waste heat recovery and the use of 
new technologies (e.g., APU with DPF, battery powered APU and a 
different stop-start technology on vocational vehicles) that were not 
considered in the proposal. We describe these changes in Chapter 2 
.11of the RIA.
---------------------------------------------------------------------------

    \796\ ICF International. Investigation of Costs for Strategies 
to Reduce Greenhouse Gas Emissions for Heavy-Duty On-Road Vehicles. 
July 2010.
    \797\ Schubert, R., Chan, M., Law, K. (2015). Commercial Medium- 
and Heavy-Duty (MD/HD) Truck Fuel Efficiency Cost Study. Washington, 
DC: National Highway Traffic Safety Administration.
---------------------------------------------------------------------------

    Importantly, technology costs differ from package costs which 
include adoption rates. Package costs have changed more significantly 
due to changes to the adoption rates as described throughout the 
earlier sections of this Preamble and briefly below in Section 
IX.B.1.(d).
    For HD pickups and vans, we have similarly used costs from the 
proposal except for the updating to 2013 dollars. As explained in the 
proposal, we relied primarily on the Phase 1 rule and the recent light-
duty 2017-2025 model year rule since most technologies expected on 
these vehicles are, in effect, the same as those used on light-duty 
pickups. Many of those technology DMCs are based on cost teardown 
studies which the agencies consider to be the most robust method of 
cost estimation. However, because most of the HD versions of those 
technologies are expected to be more costly than their light-duty 
counterparts, we have scaled upward most of the light-duty DMCs for 
this analysis. We have also used some costs developed under contract to 
NHTSA by Tetra Tech.\798\
---------------------------------------------------------------------------

    \798\ Schubert, R., Chan, M., Law, K. (2015). Commercial Medium- 
and Heavy-Duty (MD/HD) Truck Fuel Efficiency Cost Study. Washington, 
DC: National Highway Traffic Safety Administration.
---------------------------------------------------------------------------

    Importantly, in our methodology, all technologies are treated as 
being sourced from a supplier rather than being developed and produced 
in-house. As a result, some portion of the total indirect costs of 
making a technology or system--those costs incurred by the supplier for 
research, development, transportation, marketing etc.--are contained in 
the sales price to the engine and/or vehicle/trailer manufacturer 
(i.e., the original equipment manufacturer (OEM)). That sale price paid 
by the OEM to the supplier is the DMC we estimate.
    We present the details--sources, DMC values, scaling from light-
duty values, markups, learning effects, adoption rates--behind all our 
costs in Chapter 2 of the RIA.
(b) Indirect Costs
    To produce a unit of output, engine and truck manufacturers incur 
direct and indirect costs. Direct costs include cost of materials and 
labor costs. Indirect costs are all the costs associated with producing 
the unit of output that are not direct costs--for example, they may be 
related to production (such as research and development [R&D]), 
corporate operations (such as salaries, pensions, and health care costs 
for corporate staff), or selling (such as transportation, dealer 
support, and marketing). Indirect costs are generally recovered by 
allocating a share of the costs to each unit of good sold. Although it 
is possible to account for direct costs allocated to each unit of good 
sold, it is more challenging to account for indirect costs allocated to 
a unit of goods sold. To make a cost analysis process more feasible, 
markup factors, which relate total indirect costs to total direct 
costs, have been developed. These factors are often referred to as 
retail price equivalent (RPE) multipliers.
    While the agencies have traditionally used RPE multipliers to 
estimate indirect costs, in recent GHG/CAFE/fuel consumption rules RPEs 
have been replaced in the primary analysis with indirect cost 
multipliers (ICMs). ICMs differ from RPEs in that they attempt to 
estimate not all indirect costs incurred to bring a product to point of 
sale, but only those indirect costs that change as a result of a 
government action or regulatory requirement. As such, some indirect 
costs, notably health and retirement benefits of retired employees, 
among other indirect costs, will not be expected to change due to a 
government action and, therefore, the portion of the RPE that covered 
those costs does not change.
    Further, the ICM is not a ``one-size-fits-all'' markup as is the 
traditional RPE. With ICMs, higher complexity technologies like 
hybridization or moving from a manual to automatic transmission may 
require higher indirect costs--more research and development, more 
integration work, etc.--suggesting a higher markup. Conversely, lower 
complexity technologies like reducing friction or adding passive aero 
features may require fewer indirect costs thereby suggesting a lower 
markup.
    Notably, ICMs are also not a simple multiplier as are traditional 
RPEs. The ICM is broken into two parts--warranty related and non-
warranty related costs. The warranty related portion of the ICM is 
relatively small while the non-warranty portion represents typically 
over 95 percent of indirect costs. These two portions are applied to 
different DMC values to arrive at total costs (TC). The warranty 
portion of the markup is applied to a DMC that decreases year-over-year 
due to learning effects (described below in Section IX.B.1.c).\799\ As 
learning effects decrease the DMC with production volumes, it makes 
sense that warranty costs will decrease since those parts replaced 
under warranty should be less costly. In contrast, the non-warranty 
portion of the markup is applied to a static DMC year-over-year 
resulting in static indirect costs. This is logical since the 
production plants and transportation networks and general overhead 
required to build parts, market them, deliver them and integrate them 
into vehicles do not necessarily decrease in cost year-over-year. 
Because the warranty and non-warranty portions of the ICM are applied 
differently, one cannot compare the markup itself to the RPE to 
determine which markup will result in higher indirect cost estimates, 
at least in the time periods typically considered in our rules (four to 
ten years).
---------------------------------------------------------------------------

    \799\ We note that the labor portion of warranty repairs does 
not decrease due to learning. However, we do not have data to 
separate this portion and so we apply learning to the entire 
warranty cost. Because warranty costs are a small portion of overall 
indirect costs, this has only a minor impact on the analysis.
---------------------------------------------------------------------------

    In the NPRM, the agencies expressed concern that some potential 
costs associated with this rulemaking may not be adequately captured by 
our ICMs. ICMs are estimated based on a few specific technologies and 
these technologies may not be representative of the changes actually 
made to meet the requirements. We requested and received comment on 
this issue. Specifically, some commenters argued that we had 
underestimated costs associated with R&D and costs associated with our 
compliance programs, both of which are indirect costs. However, we 
address those indirect costs separately because GHG-related R&D and 
GHG-related

[[Page 73864]]

compliance were not part of the retail price equivalent markups upon 
which our indirect cost multipliers are based. We discuss these R&D and 
compliance costs more below and in Chapter 7 of the RIA.
    We provide more details on our ICM approach and the markups used 
for each technology in Chapter 2.12 of the RIA.
(c) Learning Effects on Direct and Indirect Costs
    For some of the technologies considered in this analysis, 
manufacturer learning effects will be expected to play a role in the 
actual end costs. The ``learning curve'' or ``experience curve'' 
describes the reduction in unit production costs as a function of 
accumulated production volume. In theory, the cost behavior it 
describes applies to cumulative production volume measured at the level 
of an individual manufacturer, although it is often assumed--as both 
agencies have done in past regulatory analyses--to apply at the 
industry-wide level, particularly in industries that utilize many 
common technologies and component supply sources. Both agencies believe 
there are indeed many factors that cause costs to decrease over time. 
Research in the costs of manufacturing has consistently shown that, as 
manufacturers gain experience in production, they are able to apply 
innovations to simplify machining and assembly operations, use lower 
cost materials, and reduce the number or complexity of component parts. 
All of these factors allow manufacturers to lower the per-unit cost of 
production (i.e., the manufacturing learning curve).\800\
---------------------------------------------------------------------------

    \800\ See ``Learning Curves in Manufacturing,'' L. Argote and D. 
Epple, Science, Volume 247; ``Toward Cost Buy down Via Learning-by-
Doing for Environmental Energy Technologies, R. Williams, Princeton 
University, Workshop on Learning-by-Doing in Energy Technologies, 
June 2003; ``Industry Learning Environmental and the Heterogeneity 
of Firm Performance, N. Balasubramanian and M. Lieberman, UCLA 
Anderson School of Management, December 2006, Discussion Papers, 
Center for Economic Studies, Washington DC.
---------------------------------------------------------------------------

    In this analysis, the agencies are using the same approach to 
learning as done in the proposal and in past GHG/CAFE/fuel consumption 
rules. In short, learning effects result in rapid cost reductions in 
the early years following introduction of a new technology. The 
agencies have estimated those cost reductions as resulting in 20 
percent lower costs for every doubling of production volume. As 
production volumes increase, learning rates continue at the same pace 
but flatten asymptotically due to the nature of the persistent doubling 
of production required to realize that cost reduction. As such, the 
cost reductions flatten out as production volumes continue to increase. 
Consistent with the Phase 1 rule, we refer to these two distinct 
portions of the ``learning cost reduction curve'' or ``learning curve'' 
as the steeper and flatter portions of the curve. On that steep portion 
of the curve, costs are estimated to decrease by 20 percent for each 
double of production or, by proxy, in the third and then fifth year of 
production following introduction. On the flat portion of the curve, 
costs are estimated to decrease by 3 percent per year for 5 years, then 
2 percent per year for 5 years, then 1 percent per year for 5 years. 
Also consistent with the Phase 1 rule, the majority of the technologies 
we expect will be adopted are considered to be on the flat portion of 
the learning curve meaning that the 20 percent cost reductions are 
rarely applied. The agencies requested and received comments on our 
approach to estimating learning effects, specifically with respect to 
cost reductions applied to waste heat recovery and APUs. Commenters 
suggested that, since waste heat recovery is not in production, the 
agencies should not have applied learning effect to that technology. 
They also argued that, since APUs have been around for years, applying 
any cost reduction effects to their costs is ``questionable.'' The 
agencies disagree with both of these comments. Whether production-
related learning-by-doing cost reductions or from other factors, we are 
aware of dramatic changes to waste heat recovery systems that clearly 
make that technology less costly. We describe these changes in more 
detail in Chapter 2 of the RIA. Also, to suggest that APUs cannot 
undergo any cost reductions from learning does not seem reasonable. The 
agencies have placed that technology on the flat portion of the 
learning curve since it is well established. As a result, the estimated 
learning effects are not large in scale, but to suggest that an APU 
will cost the same in the 2020s as it does today, in constant dollar 
terms, is not reasonable. Further, the commenter provided no supporting 
data or information to support this claim.
    We provide more details on the concept of learning-by-doing and the 
learning effects applied in this analysis in Chapter 2.11 of the RIA.
(d) Technology Adoption Rates and Developing Package Costs
    Determining the stringency of these standards involves a balancing 
of relevant factors--chiefly technology feasibility and effectiveness, 
costs, and lead time. For vocational vehicles, tractors and trailers, 
the agencies have projected a technology path to achieve these 
standards reflecting an application rate of those technologies the 
agencies consider to be available at reasonable cost in the lead times 
provided. The agencies do not expect (and do not require) each of the 
technologies for which costs have been developed to be employed by all 
trucks and trailers across the board.\801\ Further, many of today's 
vehicles are already equipped with some of the technologies and/or are 
expected to adopt them by MY 2018 to comply with the HD Phase 1 
standards. Estimated adoption rates in both the reference and control 
cases are necessary for each vehicle/trailer category. The adoption 
rates for most technologies are zero in the reference case; however, 
for some technologies--notably aero and tire technologies--the adoption 
rate is not zero in the reference case. These reference and control 
case adoption rates are then applied to the technology costs with the 
result being a package cost for each vehicle/trailer category. 
Technology adoption rates were presented in Sections II through V for 
engines, tractors, vocational vehicles and trailers. Individual 
technology costs are presented in Chapter 2.11 of the final RIA.
---------------------------------------------------------------------------

    \801\ The one exception are the design standards for non-aero 
box vans and non-box trailers, which do mandate use of certain tire-
related technologies.
---------------------------------------------------------------------------

    For HD pickups and vans, the CAFE model determines the technology 
adoption rates that are estimated to most cost effectively meet the 
standards. Similar to vocational vehicles, tractors and trailers, 
package costs are rarely if ever a simple sum of all the technology 
costs since each technology will be expected to be adopted at different 
rates. The methods for estimating technology adoption rates and 
resultant costs per vehicle (and other impacts) for HD pickups and vans 
are discussed above in Section VI. Individual technology costs are 
presented in Chapter 2.11 of the final RIA.
    We provide details of expected technology adoption rates for each 
of the regulatory subcategories in Chapter 2 of the RIA. We present 
package costs both in Sections III through VI of this Preamble and in 
more detail in Chapter 2 of the RIA.
(e) Conversion of Technology Costs to 2013 U.S. Dollars
    As noted above in Section IX.B.1, the agencies are using technology 
costs from many different sources. These sources, having been published 
in different years, present costs in different year dollars (i.e., 2009 
dollars or 2010

[[Page 73865]]

dollars). For this analysis, the agencies sought to have all costs in 
terms of 2013 dollars to be consistent with the dollars used by AEO in 
its 2015 Annual Energy Outlook.\802\ The agencies have used the GDP 
Implicit Price Deflator for Gross Domestic Product as the converter, 
with the actual factors used as shown in Table IX-1.\803\
---------------------------------------------------------------------------

    \802\ U.S. Energy Information Administration, Annual Energy 
Outlook 2015, Early Release; Report Number DOE/EIA-0383(2015), April 
2015.
    \803\ Bureau of Economic Analysis, Table 1.1.9 Implicit Price 
Deflators for Gross Domestic Product; as revised on August 27, 2015.

                                   Table IX-1--Implicit Price Deflators and Conversion Factors for Conversion to 2013$
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     2006       2007       2008       2009       2010       2011       2012       2013
--------------------------------------------------------------------------------------------------------------------------------------------------------
Price index for GDP.............................................     94.814     97.337     99.246        100    101.221    103.311    105.214    106.929
Factor applied for 2012$........................................      1.128      1.099      1.077      1.069      1.056      1.035      1.016      1.000
--------------------------------------------------------------------------------------------------------------------------------------------------------

(2) Compliance Program Costs
    The agencies have also estimated additional and/or new compliance 
costs associated with these standards. Normally, compliance program 
costs will be considered part of the indirect costs and, therefore, 
will be accounted for via the markup applied to direct manufacturing 
costs. However, since the agencies are proposing new compliance 
elements that were not present during development of the indirect cost 
markups used in this analysis, additional compliance program costs are 
being accounted for via a separate ``line-item.'' New research and 
development costs (see below) are being handled in the same way.
    The new compliance program elements included in this rule are new 
powertrain testing within the vocational vehicle program, and an all-
new compliance program (since none has existed to date) for the trailer 
program. The remaining compliance provisions are identical to those in 
Phase 1, and the estimated costs therefore are derived using the same 
methodology used to estimate compliance costs in the Phase 1 rule. 
Compliance program costs cover costs associated with any necessary 
compliance testing and reporting to the agencies. The details behind 
the estimated compliance program costs are provided in Chapter 7 of the 
RIA.
    The agencies requested and received comments on our compliance cost 
estimates. Some commenters were concerned that we had significantly 
underestimated costs. In response, we have adjusted our compliance 
costs estimates, including those for testing and reporting, and have 
increased our annual compliance costs from roughly $6 million per year 
to nearly $11 million per year. This excludes the estimated $16 million 
in 2020 to build and/or upgrade facilities to conduct testing. We 
discuss our updated estimates in more detail in Chapter 7 of the RIA.
(3) Research and Development Costs
    Much like the compliance program costs described above, we have 
estimated additional HDD engine, vocational vehicle and tractor R&D 
associated with these standards that is not accounted for via the 
indirect cost markups used for these segments. Much like the Phase 1 
rule, EPA is estimating these additional R&D costs will occur over a 4-
year timeframe as these standards come into force and industry works on 
means to comply. After that period, the additional R&D costs go to $0 
as R&D expenditures return to their normal levels and R&D costs are 
accounted for via the ICMs--and the RPEs behind them--used for these 
segments. The details behind the estimated R&D costs are provided in 
Chapter 7 of the RIA
    The agencies requested and received comments on our R&D estimates. 
One commenter suggested that our estimate of $960 million over four 
years, for hundreds of types of disparate vehicles was unrealistic 
given the $80 million of R&D spent on the Super Truck program over 5 
years. Unfortunately, no better estimate was provided by commenters. We 
have increased our estimated R&D, relative to that estimated in the 
proposal, by roughly $14 million per year for 4 years resulting in a 
total additional R&D estimate of over $1 billion. Importantly, as 
noted, this R&D spending is an additional expenditure above and beyond 
that estimated as part of the indirect cost markups which include in 
them an estimate of roughly 4 percent of revenues spent on R&D. Another 
way of stating this is that roughly 4 percent of our technology costs 
are actually estimated as R&D-related costs. Given our annual 
technology costs of $2 billion to $5 billion per year from 2021 through 
2027, or over $24 billion over those 7 years, we are estimating another 
$1 billion in R&D via our indirect cost markups (4 percent of $24 
billion). In other words, we are really estimating roughly $2 billion 
in R&D spending during the calendar years 2021 through 2027.
(4) Summary of Costs of the Vehicle Programs
    The agencies have estimated the costs of the vehicle standards on 
an annual basis for the years 2018 through 2050, and have also 
estimated costs for the full model year lifetimes of MY 2018 through MY 
2029 vehicles. Table IX-2 shows the annual costs of these standards 
along with net present values using both 3 percent and 7 percent 
discount rates. Table IX-3 shows the discounted model year lifetime 
costs of these standards at both 3 percent and 7 percent discount rates 
along with sums across applicable model years.


 Table IX-2--Annual Costs of the Final Program and Net Present Values at 3% and 7% Discount Rates Using Method B
                                        and Relative to the Flat Baseline
                                            [$Millions of 2013$] \a\
----------------------------------------------------------------------------------------------------------------
                  Calendar year                   New technology    Compliance          R&D             Sum
----------------------------------------------------------------------------------------------------------------
2018............................................            $227              $0              $0            $227
2019............................................             215               0               0             215
2020............................................             220              17               0             237
2021............................................           2,270              11             259           2,540

[[Page 73866]]

 
2022............................................           2,243              11             259           2,512
2023............................................           2,485              11             259           2,755
2024............................................           3,890              11             259           4,160
2025............................................           4,146              11               0           4,157
2026............................................           4,203              11               0           4,213
2027............................................           5,219              11               0           5,230
2028............................................           5,176              11               0           5,186
2029............................................           5,195              11               0           5,206
2030............................................           5,219              11               0           5,229
2035............................................           5,642              11               0           5,653
2040............................................           6,245              11               0           6,255
2050............................................           7,270              11               0           7,280
NPV, 3%.........................................          86,780             191             818          87,788
NPV, 7%.........................................          41,148             102             604          41,854
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


                     Table IX-3--Discounted MY Lifetime Costs of the Final Program Using Method B and Relative to the Flat Baseline
                                                                [$Millions of 2013$] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Discounted at 3%                                    Discounted at 7%
                                                 -------------------------------------------------------------------------------------------------------
                   Model year                         New                                                 New
                                                   technology   Compliance      R&D          Sum       technology   Compliance      R&D          Sum
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018............................................         $205           $0           $0         $205         $179           $0           $0         $179
2019............................................          188            0            0          188          159            0            0          159
2020............................................          187           14            0          201          152           12            0          163
2021............................................        1,873            9          214        2,096        1,462            7          167        1,636
2022............................................        1,797            8          207        2,013        1,350            6          156        1,513
2023............................................        1,933            8          201        2,143        1,398            6          146        1,550
2024............................................        2,938            8          195        3,141        2,046            6          136        2,187
2025............................................        3,040            8            0        3,048        2,038            5            0        2,043
2026............................................        2,992            8            0        2,999        1,930            5            0        1,935
2027............................................        3,607            7            0        3,614        2,240            5            0        2,245
2028............................................        3,473            7            0        3,480        2,076            4            0        2,080
2029............................................        3,384            7            0        3,391        1,948            4            0        1,952
    Sum.........................................       25,617           84          818       26,519       16,978           59          604       17,642
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

    New technology costs begin in MY 2018 as trailers begin to add new 
technology. Compliance costs begin with the new standards with capital 
cost expenditure in that year for building and upgrading test 
facilities to conduct the powertrain testing in the vocational program. 
Research and development costs begin in 2021 and last for 4 years as 
engine, tractor and vocational vehicle manufacturers conduct research 
and development testing to integrate new technologies into their 
engines and vehicles.

C. Changes in Fuel Consumption and Expenditures

(1) Changes in Fuel Consumption
    The new GHG and fuel consumption standards will result in 
significant improvements in the fuel efficiency of affected vehicles, 
and drivers of those vehicles will see corresponding savings associated 
with reduced fuel expenditures. The agencies have estimated the impacts 
on fuel consumption for these standards. Details behind how these 
changes in fuel consumption were calculated are presented in Section 
VII of this Preamble and in Chapter 5 of the RIA. The total number of 
miles that vehicles are driven each year is different under the 
regulatory alternatives than in the reference case due to the ``rebound 
effect'' (discussed below in Section IX.E), so the changes in fuel 
consumption associated with each alternative are not strictly 
proportional to differences in the fuel economy levels they require.
    The expected annual impacts on fuel consumption are shown in Table 
IX-4. Table IX-5 shows the MY lifetime changes in fuel consumption. The 
gallons shown in these tables as reductions in fuel consumption reflect 
reductions due to these standards and include any increased consumption 
resulting from the rebound effect (discussed below in Section IX.E).

[[Page 73867]]



                Table IX-4--Annual Fuel Consumption Reductions due to the Final Program Using Method B and Relative to the Flat Baseline
                                                                [Millions of gallons] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Retail gasoline                                     Diesel
                                                         -----------------------------------------------------------------------------------------------
                      Calendar year                                            Fuel                                            Fuel
                                                          Reference case    consumption     % Reduction   Reference case    consumption     % Reduction
                                                                             reduction                                       reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018....................................................          10,958               0               0          46,636              37               0
2019....................................................          11,118               0               0          47,056              76               0
2020....................................................          11,265               0               0          47,397             117               0
2021....................................................          11,391              28               0          47,548             428               1
2022....................................................          11,515              74               1          47,813             812               2
2023....................................................          11,633             138               1          48,146           1,211               3
2024....................................................          11,745             226               2          48,572           1,835               4
2025....................................................          11,843             330               3          48,941           2,457               5
2026....................................................          11,936             448               4          49,194           3,063               6
2027....................................................          12,039             588               5          49,483           3,853               8
2028....................................................          12,138             723               6          49,753           4,610               9
2029....................................................          12,234             852               7          50,036           5,335              11
2030....................................................          12,324             974               8          50,393           6,031              12
2035....................................................          12,680           1,454              11          52,492           8,883              17
2040....................................................          12,920           1,724              13          55,399          10,778              19
2050....................................................          13,185           1,904              14          61,663          12,986              21
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.


          Table IX-5--Model Year Lifetime Fuel Consumption Reductions due to the Final Program Using Method B and Relative to the Flat Baseline
                                                                [Millions of gallons] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Retail gasoline                                     Diesel
                                                         -----------------------------------------------------------------------------------------------
                       Model year                                              Fuel                                            Fuel
                                                             Reference      consumption     % Reduction      Reference      consumption     % Reduction
                                                                             reduction                                       reduction
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018....................................................          12,541               0               0          46,628             302               1
2019....................................................          12,409               0               0          47,583             293               1
2020....................................................          12,455               0               0          49,084             286               1
2021....................................................          12,328             322               3          48,950           4,643               9
2022....................................................          12,252             550               4          48,994           4,807              10
2023....................................................          12,233             772               6          48,884           4,947              10
2024....................................................          12,342           1,075               9          49,924           7,742              16
2025....................................................          12,452           1,301              10          50,364           7,954              16
2026....................................................          12,555           1,525              12          50,477           8,111              16
2027....................................................          12,591           1,836              15          50,664          10,646              21
2028....................................................          12,619           1,840              15          50,916          10,698              21
2029....................................................          12,631           1,841              15          51,381          10,800              21
    Sum.................................................         149,408          11,062               7         593,848          71,229              12
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

(2) Fuel Savings
    We have also estimated the changes in fuel expenditures, or the 
fuel savings, using fuel prices estimated in the Energy and Information 
Administration's 2015 Annual Energy Outlook.\804\ As the AEO fuel price 
projections go through 2040 and not beyond, fuel prices beyond 2040 
were set equal to the 2040 values. These estimates do not account for 
the significant uncertainty in future fuel prices; the monetized fuel 
savings will be understated if actual fuel prices are higher (or 
overstated if fuel prices are lower) than estimated. The Annual Energy 
Outlook (AEO) is a standard reference used by NHTSA and EPA and many 
other government agencies to estimate the projected price of fuel. This 
has been done using both the pre-tax and post-tax fuel prices. Since 
the post-tax fuel prices are the prices paid at fuel pumps, the fuel 
savings calculated using these prices represent the changes fuel 
purchasers will see. The pre-tax fuel savings measure the value to 
society of the resources saved when less fuel is refined and consumed. 
Assuming no change in fuel tax rates, the difference between these two 
columns represents the reduction in fuel tax revenues that will be 
received by state and federal governments, or about $204 million in 
2021 and $5.8 billion by 2050 as shown in Table IX-6 where annual 
changes in monetized fuel savings are shown along with net present 
values using 3 percent

[[Page 73868]]

and 7 percent discount rates. Table IX-7 and Table IX-8 show the 
discounted model year lifetime fuel savings using 3 percent and 7 
percent discount rates, respectively.
---------------------------------------------------------------------------

    \804\ U.S. Energy Information Administration, Annual Energy 
Outlook 2015; Report Number DOE/EIA-0383(2015), April 2015.

    Table IX-6--Annual Fuel Savings and Net Present Values at 3% and 7% Discount Rates Using Method B for the Final Program and Relative to the Flat
                                                                        Baseline
                                                                [$Millions of 2013$] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Fuel savings--retail                            Fuel savings--untaxed
               Model year                ------------------------------------------------------------------------------------------------    Change in
                                             Gasoline         Diesel            Sum          Gasoline         Diesel            Sum          transfer
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018....................................              $0            $114            $114              $0             $97             $97             $17
2019....................................               0             237             237               0             202             202              35
2020....................................               0             371             371               0             319             319              53
2021....................................              78           1,384           1,462              67           1,191           1,258             204
2022....................................             210           2,689           2,899             181           2,323           2,504             395
2023....................................             396           4,081           4,476             342           3,548           3,889             587
2024....................................             657           6,296           6,952             571           5,488           6,059             894
2025....................................             973           8,576           9,550             848           7,495           8,343           1,207
2026....................................           1,343          10,903          12,246           1,173           9,586          10,759           1,487
2027....................................           1,787          13,985          15,772           1,564          12,328          13,892           1,880
2028....................................           2,234          17,057          19,290           1,959          15,074          17,033           2,257
2029....................................           2,675          20,114          22,789           2,351          17,873          20,224           2,565
2030....................................           3,116          23,160          26,276           2,746          20,627          23,373           2,903
2035....................................           5,131          37,840          42,971           4,593          34,287          38,880           4,091
2040....................................           6,722          51,194          57,916           6,102          46,991          53,093           4,824
2050....................................           7,426          61,684          69,109           6,740          56,619          63,359           5,750
NPV, 3%.................................          65,703         511,060         576,763          59,061         464,240         523,301          53,462
NPR, 7%.................................          26,936         209,666         236,602          24,131         189,702         213,833          22,769
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.


    Table IX-7--Discounted Model Year Lifetime Fuel Savings, 3% Discount Rate Using Method B for the Final Program and Relative to the Flat Baseline
                                                                [$Millions of 2013$] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Fuel savings--retail                            Fuel savings--untaxed
               Model year                ------------------------------------------------------------------------------------------------    Change in
                                             Gasoline         Diesel            Sum          Gasoline         Diesel            Sum          transfer
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018....................................              $0            $781            $781              $0            $680            $680            $101
2019....................................               0             747             747               0             653             653              94
2020....................................               0             719             719               0             631             631              87
2021....................................             674          11,497          12,171             590          10,155          10,746           1,426
2022....................................           1,132          11,781          12,912             994          10,440          11,435           1,478
2023....................................           1,567          11,990          13,557           1,381          10,660          12,041           1,516
2024....................................           2,154          18,556          20,709           1,903          16,548          18,451           2,259
2025....................................           2,571          18,849          21,420           2,278          16,859          19,137           2,283
2026....................................           2,973          19,003          21,976           2,640          17,048          19,688           2,288
2027....................................           3,532          24,648          28,180           3,144          22,171          25,315           2,865
2028....................................           3,493          24,459          27,953           3,116          22,060          25,176           2,776
2029....................................           3,449          24,378          27,828           3,084          22,044          25,128           2,700
Sum.....................................          21,545         167,408         188,954          19,131         149,950         169,081          19,873
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.


    Table IX-8--Discounted Model Year Lifetime Fuel Savings, 7% Discount Rate Using Method B for the Final Program and Relative to the Flat Baseline
                                                                [$Millions of 2013$] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Fuel savings--retail                            Fuel savings--untaxed
               Model year                ------------------------------------------------------------------------------------------------    Change in
                                             Gasoline         Diesel            Sum          Gasoline         Diesel            Sum          transfer
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018....................................              $0            $558            $558              $0            $483            $483             $74
2019....................................               0             510             510               0             444             444              66
2020....................................               0             466             466               0             408             408              58
2021....................................             420           7,031           7,451             367           6,188           6,554             897
2022....................................             674           6,946           7,620             591           6,134           6,725             895
2023....................................             896           6,814           7,710             788           6,038           6,826             884

[[Page 73869]]

 
2024....................................           1,186          10,161          11,347           1,045           9,033          10,078           1,269
2025....................................           1,362           9,947          11,309           1,204           8,870          10,074           1,235
2026....................................           1,516           9,666          11,182           1,343           8,648           9,991           1,191
2027....................................           1,737          12,081          13,818           1,542          10,839          12,381           1,436
2028....................................           1,655          11,551          13,206           1,474          10,393          11,866           1,340
2029....................................           1,576          11,097          12,672           1,406          10,013          11,419           1,254
Sum.....................................          11,022          86,827          97,849           9,759          77,491          87,249          10,600
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

D. Maintenance Expenditures

    The agencies expect increases in maintenance costs under these 
standards. In the NPRM, we estimated maintenance costs associated with 
lower rolling resistance tires. In the final rule, we have included 
maintenance costs for many more systems, including waste heat recovery, 
APUs, transmission fluids, etc. We have estimated that these 
maintenance costs will be incurred throughout the vehicle lifetime at 
intervals consistent with typical replacement intervals. Those 
intervals are difficult to quantify given the variety of vehicles and 
operating modes within the HD industry. We detail the inputs used to 
estimate maintenance impacts in Chapter 7.3.3 of the RIA.
    We have heard from at least one source \805\ that strong hybrid 
maintenance can be higher in some ways, including possible battery 
replacement, but may also be much lower for some vehicle systems like 
brakes and general engine wear. New for the FRM, relative to the 
proposal, are maintenance costs on hybrid battery systems in vocational 
vehicles and some reduction in oil change costs on vocational vehicles 
with stop-start systems since less idling should result in fewer oil 
changes. See RIA 2.11.7. We have also included new costs for axle fluid 
replacements for vocational vehicles adding high efficiency axles, and 
transmission fluid replacements for vehicles projected to move from 
manual to automated transmissions. For tractors, we have added these 
same axle and transmission fluid costs and for the same reasons. For 
tractors, we have also added maintenance costs associated with 
auxiliary power units and for fuel operated heaters. All of the new 
cost estimates and the maintenance intervals are presented in more 
detail in Chapter 7.2.3 of the RIA.
---------------------------------------------------------------------------

    \805\ Allison Transmission's Responses to EPA's Hybrid 
Questions, November 6, 2014.
---------------------------------------------------------------------------

    Table IX-9 shows the annual increased maintenance costs of the 
final program along with net present values using both 3 percent and 7 
percent discount rates. Table IX-10 shows the discounted model year 
lifetime increased maintenance costs of the final program at both 3 
percent and 7 percent discount rates along with sums across applicable 
model years.

 Table IX-9--Annual Maintenance Expenditure Increase due to the Rule and
    Net Present Values at 3% and 7% Discount Rates Using Method B and
                      Relative to the Flat Baseline
                        [$Millions of 2013$] \a\
------------------------------------------------------------------------
                                                            Maintenance
                      Calendar year                         expenditure
                                                             increase
------------------------------------------------------------------------
2018....................................................              $1
2019....................................................               1
2020....................................................               2
2021....................................................              20
2022....................................................              39
2023....................................................              60
2024....................................................              83
2025....................................................             106
2026....................................................             127
2027....................................................             167
2028....................................................             206
2029....................................................             244
2030....................................................             244
2035....................................................             244
2040....................................................             244
2050....................................................             244
NPV, 3%.................................................           3,188
NPV, 7%.................................................           1,463
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.


Table IX-10--Discounted MY Lifetime Maintenance Expenditure Increase Due
      to the Rule Using Method B and Relative to the Flat Baseline
                        [$Millions of 2013$] \a\
------------------------------------------------------------------------
                                               3% Discount   7% Discount
                 Model year                       rate          rate
------------------------------------------------------------------------
2018........................................            $7            $5
2019........................................             6             4
2020........................................             6             4
2021........................................           155            96
2022........................................           156            94
2023........................................           160            93
2024........................................           175            98
2025........................................           177            96
2026........................................           165            86
2027........................................           303           152
2028........................................           293           141
2029........................................           285           132
                                             ---------------------------
    Sum.....................................         1,889         1,000
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.

E. Analysis of the Rebound Effect

    The ``rebound effect'' has been defined in a variety of different 
ways in the energy policy and economics literature. One common 
definition states that the rebound effect is the increase in demand for 
an energy service when the cost of the energy service is reduced due to 
efficiency improvements.806 807 808 In

[[Page 73870]]

the context of heavy-duty vehicles (HDVs), this can be interpreted as 
an increase in HDV fuel consumption resulting from more intensive 
vehicle use in response to increased vehicle fuel efficiency.\809\ 
Although much of this vehicle use increase is likely to take the form 
of increases in the number of miles vehicles are driven, it can also 
take the form of increases in the loaded weight at which vehicles 
operate or changes in traffic and road conditions vehicles encounter as 
operators alter their routes and schedules in response to improved fuel 
efficiency. Because this more intensive use consumes fuel and generates 
emissions, it reduces the fuel savings and avoided emissions that would 
otherwise be expected to result from the increases in fuel efficiency 
in this rulemaking.
---------------------------------------------------------------------------

    \806\ Winebrake, J.J., Green, E.H., Comer, B., Corbett, J.J., 
Froman, S., 2012. Estimating the direct rebound effect for on-road 
freight transportation. Energy Policy 48, 252-259.
    \807\ Greene, D.L., Kahn, J.R., Gibson, R.C., 1999, ``Fuel 
economy rebound effect for U.S. household vehicles,'' The Energy 
Journal, 20.
    \808\ For a discussion of the wide range of definitions found in 
the literature, see Appendix D: Discrepancy in Rebound Effect 
Definitions, in EERA (2014), ``Research to Inform Analysis of the 
Heavy-Duty vehicle Rebound Effect,'' Excerpts of Draft Final Report 
of Phase 1 under EPA contract EP-C-13-025. (Docket ID: EPA-HQ-OAR-
2014-0827). See also Greening, L.A., Greene, D.L., Difiglio, C., 
2000, ``Energy efficiency and consumption--the rebound effect--a 
survey,'' Energy Policy, 28, 389-401.
    \809\ We discuss other potential rebound effects in Section 
E.3.b., such as the indirect and economy-wide rebound effects. Note 
also that there is more than one way to measure HDV energy services 
and vehicle use. The agencies' analyses use VMT as a measure (as 
discussed below); other potential measures include ton-miles, cube-
miles, and fuel consumption.
---------------------------------------------------------------------------

    In our analysis and discussion below, we focus on one widely-used 
metric to estimate the rebound effect associated with all types of more 
intensive vehicle use, the increase in vehicle miles traveled (VMT) 
that results from improved fuel efficiency. VMT can often provide a 
reasonable approximation for all types of more intensive vehicle use. 
For simplicity, we refer to this as ``the VMT rebound effect'' or ``the 
direct VMT rebound'' throughout this section, although we acknowledge 
that it is an approximation to the rebound effect associated with all 
types of more intensive vehicle use. The agencies use our VMT rebound 
estimates to generate VMT inputs that are then entered into the EPA 
MOVES national emissions inventory model and the Volpe Center's HD CAFE 
model. Both of these models use these inputs along with many others to 
generate projected emissions and fuel consumption changes resulting 
from each of the regulatory alternatives analyzed.
    The following sections describe the factors affecting the magnitude 
of HDV VMT rebound; review the econometric and other evidence related 
to HDV VMT rebound; and summarize how we estimated the HDV rebound 
effect for this rulemaking.
(1) Factors Affecting the Magnitude of HDV VMT Rebound
    The magnitude and timing of HDV VMT rebound are driven by the 
interaction of many different factors.\810\ Fuel savings resulting from 
fuel efficiency standards may cause HDV operators and their customers 
to change their patterns of HDV use and fuel consumption in a variety 
of ways. As discussed in the RIA (Chapter 8), HDV VMT rebound estimates 
determined via other proxy elasticities vary, but in no case has there 
been an estimate that fully offsets the fuel saved due to efficiency 
improvements (i.e., no rebound effect greater than or equal to 100 
percent).\811\
---------------------------------------------------------------------------

    \810\ These factors are discussed more fully in a report to EPA 
from EERA, which illustrates in a series of diagrams the complex 
system of decisions and decision-makers that could influence the 
magnitude and timing of the rebound effect. See Sections 2.2.2, 
2.2.3, 2.2.4, and 2.3 in EERA (2014), ``Research to Inform Analysis 
of the Heavy-Duty Vehicle Rebound Effect,'' Excerpts of Draft Final 
Report of Phase 1 under EPA contract EP-C-13-025 (EPA-HQ-OAR-2014-
0827-0514).
    \811\ Elasticity is the measurement of how responsive an 
economic variable is to a change in another. For example: Price 
elasticity of demand is a measure used in economics to show the 
responsiveness, or elasticity, of the quantity demanded of a good or 
service to a change in its price. More precisely, it gives the 
percentage change in quantity demanded in response to a one percent 
change in price.
---------------------------------------------------------------------------

    If fuel cost savings are passed on to the HDV operators' customers 
(e.g., logistics businesses, manufacturers, retailers, municipalities, 
utilities consumers, etc.), those customers might reorganize their 
logistics and distribution networks over time to take advantage of 
lower operating costs. For example, customers might order more frequent 
shipments or choose products that entail longer shipping distances, 
while freight carriers might divert some shipments to trucks from other 
shipping modes such as rail, barge or air. In addition, customers might 
choose to reduce their number of warehouses, reduce shipment rates or 
make smaller but more frequent shipments, all of which could lead to an 
increase in HDV VMT. Ultimately, fuel cost savings could ripple through 
the entire economy, thus increasing demand for goods and services 
shipped by trucks, and therefore increase HDV VMT due to increased 
gross domestic product (GDP).
    Conversely, if fuel efficiency standards lead to net increases in 
the total costs of HDV operation because fuel cost savings do not fully 
offset the increase in HDV purchase prices and associated depreciation 
costs, then the price of HDV services could rise. This is likely to 
spur a decrease in HDV VMT, and perhaps a shift to alternative shipping 
modes. These effects could also ripple through the economy and affect 
GDP. Note, however, that we project fuel cost savings will offset 
technology costs in our analysis supporting the final standards.
    It is also important to note that any increase in HDV VMT resulting 
from the final standards may be offset, to some extent, by a decrease 
in VMT by older HDVs. This may occur if lower fuel costs resulting from 
our standards cause multi-vehicle fleet operators to shift VMT to 
newer, more efficient HDVs in their fleet or cause operators with 
newer, more efficient HDVs to be more successful at winning contracts 
than operators with older HDVs.
    Also, as discussed in Chapter 8.2 of the RIA, the magnitude of the 
rebound effect is likely to be influenced by the extent of any market 
failures that affect the demand for more fuel efficient HDVs, as well 
as by HDV operators' responses to their perception of the tradeoff 
between higher upfront HDV purchase costs versus lower but uncertain 
future expenditures on fuel.
(2) Recent Econometric and Other Evidence Related to HDV VMT Rebound
    As discussed above, HDV VMT rebound is defined as the change in HDV 
VMT that occurs in response to an increase in HDV fuel efficiency. We 
are not aware of any studies that directly estimate this elasticity for 
the U.S. In the proposal, we discussed a number of econometric analyses 
of other related elasticities that could potentially be used as a proxy 
for measuring HDV VMT rebound, as well as several other analyses that 
may provide insight into the magnitude of HDV VMT rebound.\812\ These 
studies produced a wide range of estimates for HDV VMT rebound, 
however, and we were unable to draw any strong conclusions about the 
magnitude of rebound based on this available literature.
---------------------------------------------------------------------------

    \812\ See 80 FR 40448-40452.
---------------------------------------------------------------------------

    We also discussed several challenges that researchers face in 
attempting to quantify the VMT rebound effect for HDVs,\813\ including 
limited data on the HD sector and the difficulty of specifying 
mathematical models that reflect the complex set of factors that 
influence HD VMT. Given these limitations, the agencies requested 
comment on a number of aspects of the proposed VMT rebound analysis, 
including procedures for measuring the rebound effect and the studies 
discussed in the proposal. The agencies also committed to reviewing and 
considering revisions to VMT rebound estimates for

[[Page 73871]]

the final rule based on submissions from public commenters and new 
research on the rebound effect.
---------------------------------------------------------------------------

    \813\ See 80 FR 40448-40452.
---------------------------------------------------------------------------

    This section reviews new econometric analyses that have been 
produced since the release of the proposal. All of these analyses study 
the change in HDV use (measured in VMT, ton-mile, or fuel consumption) 
in response to changes in fuel price ($/gallon) or fuel cost ($/mile or 
$/ton-mile). The studies presented below attempt to estimate these 
elasticities in the HDV sector using varying approaches and data 
sources.
    Concurrent with the development of the proposal for this rule, EPA 
contracted with Energy and Environmental Research Associates (EERA) to 
analyze the HDV rebound effect for regulatory assessment purposes. 
Excerpts of EERA's initial report to EPA are included in the NPRM 
docket and contain detailed qualitative discussions of the rebound 
effect as well as data sources that could be used in quantitative 
analysis.\814\ EERA also conducted follow-on quantitative analyses 
focused on estimating the impact of fuel prices on VMT and fuel 
consumption. We included a Working Paper in the NPRM docket that 
described much of this work.\815\ Note that EERA's Working Paper was 
not available at the time the agencies conducted the analysis of the 
rebound effect for the proposal, but that the agencies agreed to 
consider this work and any other work in the analysis supporting the 
final rule.
---------------------------------------------------------------------------

    \814\ EERA (2014), ``Research to Inform Analysis of the Heavy-
Duty Vehicle Rebound Effect,'' Excerpts of Draft Final Report of 
Phase 1 under EPA contract EP-C-13-025, EPA-HQ-OAR-2014-0827-0514.
    \815\ EERA (2015), ``Working Paper on Fuel Price Elasticities 
for Heavy Duty Vehicles,'' Draft Final Report of Phase 2 under EPA 
contract EP-C-11-046, EPA-HQ-OAR-2014-0827-0515.
---------------------------------------------------------------------------

    At the time of publication of the NPRM, Winebrake et al. (2015) 
published two papers in Transportation Research Part D: Transport and 
Environment based on the EERA work mentioned above.\816\ These two 
papers have been filed in each agency's docket and received public 
review and comment. In the first paper, the fuel price elasticities of 
VMT and fuel consumption for combination trucks are estimated with 
regression models. The combination trucks paper uses annual data for 
the period 1970-2012. VMT and fuel consumption are used as the 
dependent variables. The control variables include: A macroeconomic 
variable (e.g., gross domestic product (GDP)), imports/exports, and 
fuel price, among other variables. In the second paper, the fuel price 
elasticity of VMT for single unit vehicles is estimated by using annual 
data for the period 1980-2012. The single unit vehicle paper uses 
similar control variables but includes additional variables related to 
lane miles and housing construction. VMT is the only dependent variable 
modeled in the single unit vehicle paper (i.e., fuel consumption is not 
modeled).
---------------------------------------------------------------------------

    \816\ Winebrake, J.J., et al., Fuel price elasticities in the 
U.S. combination trucking sector. Transportation Research Part D: 
Transport and Environment, 2015. 38: p. 166-177.
    Winebrake, J.J., et al., Fuel price elasticities for single unit 
truck operations in the United States. Transportation Research Part 
D: Transport and Environment, 2015. 38: p. 178-187.
---------------------------------------------------------------------------

    The results in Winebrake et al. are that the null hypothesis--which 
states that the fuel price elasticity of VMT and the fuel price 
elasticity of fuel consumption are zero--cannot be rejected with 
statistical confidence. The papers hypothesize that low elasticities 
may be due to a range of possibilities including: (1) The common use of 
fuel surcharges; (2) adjustments in other operational costs such as 
labor; (3) possible principal-agent problems affecting driver behavior; 
and (4) the nature of freight transportation as an input to a larger 
supply chain system that is driven by other factors. These two papers 
suggest that previous regulatory analysis that uses a five percent 
rebound effect for combination trucks and a 15 percent rebound effect 
for single unit trucks may be overestimating the direct VMT rebound 
effect.
    To the best of our knowledge, the Winebrake et al. paper represents 
the first peer-reviewed work in the last two decades, after Gately 
(1990),\817\ that attempts to estimate quantitatively the impact of a 
change in fuel costs on HDV VMT in the U.S. context. A subsequent paper 
by Wadud, discussed in more detail below, states that there is ``only 
one creditable study'' on ``the responses of different [heavy duty] 
vehicle sectors to fuel price or income changes,'' specifically the 
Winebrake et al. combination truck work.
---------------------------------------------------------------------------

    \817\ Gately, D., 1990. The U.S. demand for highway travel and 
motor fuel. Energy J. 11, 59-74.
---------------------------------------------------------------------------

    However, there is also other recent work that has not been peer 
reviewed, or that studies HD VMT rebound in other countries, that bears 
mention. Resources for the Future (RFF) filed a comment on the proposal 
with a Working Paper by Leard et al. (2015) to address HDV rebound 
effects.818 819 Leard et al.'s paper uses detailed truck-
level micro-data from the Vehicle Inventory and Use Survey (VIUS) for 
six survey years (specifically, 1977, 1982, 1987, 1992, 1997, and 
2002). The ``rebound effect'' in this paper is defined to be a 
combination of a ``VMT elasticity with respect to fuel costs per mile'' 
($/mile); and a ``truck count elasticity with respect to fuel costs per 
mile.'' Fuel costs per mile are defined as fuel price ($/gal) divided 
by efficiency (mpg). Because the agencies do not estimate the 
directional impact of this rulemaking on vehicle sales, the portion of 
Leard et al.'s estimates associated with VMT rebound with respect to 
fuel costs per mile are the most useful point of comparison to the 
estimates in the proposal for this rulemaking.
---------------------------------------------------------------------------

    \818\ Resources for the Future (RFF) comment, EPA-HQ-OAR-2014-
0827-1200.
    \819\ Leard, B., et al., Fuel Costs, Economic Activity, and the 
Rebound Effect for Heavy-Duty Trucks. September 2015, Resources for 
the Future: RF DP 15-43, Washington, DC. EPA-HQ-OAR-2014-0827-1200-
A1.
---------------------------------------------------------------------------

    Leard et al. report a VMT rebound effect result of 18.5 percent 
with respect to fuel costs per mile for combination trucks.\820\ This 
finding suggests that previous estimates of combination truck rebound 
effects used in the proposed rule, a five percent rebound effect, may 
be underestimating the true rebound effect. Leard et al. also report a 
VMT rebound effect with respect to fuel costs per mile of 12.2 percent 
for single unit trucks.\821\ This finding (like the findings of the 
Winebrake paper) suggests that the previous use of a 15 percent rebound 
effect for single unit vehicles in the proposed rule may be 
overestimating the true rebound effect. As noted, VIUS was discontinued 
in 2002, so the most recent data in this study is 2002, which is 
fourteen years old. The Leard et al. Working Paper has not yet been 
peer reviewed or published.
---------------------------------------------------------------------------

    \820\ Leard et al. report a total VMT rebound effect result of 
29.7 percent for combination trucks, which is a sum of separate 
estimates associated with both VMT elasticity and truck count 
elasticity with respect to fuel costs per mile.
    \821\ For vocational trucks, Leard et al. report an overall 9.3 
percent rebound value, which is a sum of separate estimates 
associated with both VMT elasticity and truck count elasticity with 
respect to fuel costs per mile.
---------------------------------------------------------------------------

    Recently, Wadud (2016) has estimated price elasticities of diesel 
demand in the U.K.\822\ The paper aims to model diesel demand 
elasticities for different freight duty vehicle types in the U.K. Wadud 
uses a similar model specification as Winebrake et al. in the 
regression analysis. Wadud finds that diesel consumption in freight 
vehicles overall is quite inelastic. Diesel demand from articulated 
trucks and large goods vehicles (similar to combination trucks in the 
U.S.) does not respond to changes

[[Page 73872]]

in diesel prices. Demand in rigid trucks (similar to single unit trucks 
in the U.S.) responds to fuel price changes with a 15 percent 
elasticity. Wadud's work presents empirical results in the U.K., which 
might not be necessarily be appropriate to apply to the U.S.
---------------------------------------------------------------------------

    \822\ Wadud, Zia, Diesel Demand in the Road Freight Sector in 
the UK: Estimates for Different Vehicle Types. Applied Energy 165 
(2016), p. 849-857.
---------------------------------------------------------------------------

(3) How the Agencies Estimated the HDV Rebound Effect for the Final 
Rule
(a) Values Used in the Phase 2 NPRM Analysis
    At the time the agencies conducted their analysis of the proposed 
Phase 2 HD fuel efficiency and GHG emissions standards, the agencies 
determined that the evidence did not lend itself to any changes in the 
values used to estimate the VMT rebound effect in the HD Phase 1 
rulemaking. The agencies used the rebound effects estimate of 15 
percent for vocational vehicles five percent for combination tractors, 
and 10 percent for HD pickup trucks and vans from the HD Phase 1 
rulemaking.
(b) How the Agencies Analyzed VMT Rebound in This Final Rulemaking
    The emergence of new information as well as public comment are 
cause for updating the quantitative values used to estimate the VMT 
rebound effect from those estimated by the analysis conducted for the 
HD Phase 1 rulemaking. For vocational trucks, the Winebrake et al. 
study found no responsiveness of truck travel to diesel fuel prices, 
suggesting a VMT rebound of essentially zero. Leard et al. suggested a 
VMT rebound effect for vocational trucks of roughly 12 percent. For 
combination trucks, the Winebrake et al. study found a rebound effect 
of essentially zero percent. The Leard et al. study found a VMT 
elasticity rebound effect of roughly 18 percent for combination trucks. 
In addition to the RFF comments to which Leard et al. was included, EPA 
and NHTSA received ten other comments on HDV rebound during the comment 
period for the proposal, six of which were substantive. One of these 
commenters suggested that the agencies' rebound numbers ``appear 
reasonable.'' The five others commented that the rebound estimates for 
both combination and vocational vehicles used in the proposal were 
overestimated, and suggested using the Winebrake et al. estimates.
    In revising the HD VMT rebound estimates, we give somewhat greater 
consideration to the findings of Winebrake et al. because it is peer-
reviewed and published, whereas Leard et al. is a Working Paper. Based 
on this consideration and on the comments that we received in response 
to the proposal, the agencies have chosen to revise the VMT rebound 
estimate for vocational trucks down to five percent, and have elected 
to maintain the use of the five percent rebound effect for tractors. We 
note that while the Winebrake et al. work supports rebound estimates of 
zero percent for vocational vehicles and tractors, using a five percent 
value is conservative and leaves some consideration of uncertainty, as 
well as some consideration of the (un-peer reviewed and unpublished) 
findings of the Leard et al. study. The five percent value is in range 
of the two U.S. studies and generally addresses the issues raised by 
the commenters. We did not receive new data or comments on our 
estimated VMT rebound effect for heavy-duty pick-up trucks and vans. 
Therefore, we have elected to use the 10 percent value used for the 
proposal.
    It should be noted that the rebound estimates we have selected for 
our analysis represent the VMT impact from the final standards with 
respect to changes in the fuel cost per mile driven. As described in 
the RIA (Chapter 8), the HDV rebound effect should ideally be a measure 
of the change in fuel consumed with respect to the change in overall 
operating costs due to a change in HDV fuel efficiency. Such a measure 
would incorporate all impacts from our rules, including those from 
incremental increases in vehicle prices that reflect costs for 
improving their fuel efficiency. Therefore, VMT rebound estimates with 
respect to fuel costs per mile must be ``scaled'' to apply to total 
operating costs, by dividing them by the fraction of total operating 
costs accounted for by fuel use.
    In the NPRM, due to timing constraints, we used the same 
``overall'' VMT rebound value for each of the alternatives. For the 
final rulemaking, we determined VMT rebound separately for each HDV 
category and for each alternative. The agencies made simplifying 
assumptions in the VMT rebound analysis for this final rulemaking, 
similar to the approach taken during HD Phase 1 final rules. For 
example, due to timing constraints, the agencies did not have the final 
technology package costs for each of the alternatives prior to the need 
to conduct the emission inventory analysis. Therefore, the agencies 
used the technology package costs developed for each of the NPRM 
alternatives. Chapter 8.3.3 in the RIA provides more details on our 
assessment of HDV VMT rebound. In addition, Chapter 7 of the RIA 
presents VMT rebound for each HDV sector that we estimated for the 
final program. These VMT impacts are reflected in the estimates of 
total fuel savings and reductions in emissions of GHG and other air 
pollutants presented in Section VII and VIII of this Preamble for all 
categories.
    For the purposes of this final rulemaking, we have not taken into 
account any potential fuel savings or GHG emission reductions from the 
rail sector due to mode shift because estimates of this effect seem too 
speculative at this time. Similarly, we have not taken into account any 
fuel savings or GHG emissions reductions from the potential shift in 
VMT from older HDVs to newer, more efficient HDVs because we have found 
no evidence of this potential effect from fuel efficiency standards. 
The agencies requested comment on these assumptions in the NPRM, but 
did not receive any.
    Note that while we focus on the VMT rebound effect in our analysis 
of these final rules, there are at least two other types of rebound 
effects discussed in the energy policy and economics literature. In 
addition to VMT rebound effects, there are ``indirect'' rebound 
effects, which refers to the purchase of other goods or services (that 
consume energy) with the costs savings from energy efficiency 
improvements; and ``economy-wide'' rebound effects, which refers to the 
increased demand for energy throughout the economy in response to the 
reduced market price of energy that happens as a result of energy 
efficiency improvements. One commenter pointed out that consumers may 
use their savings from lower fuel costs as a result of the direct 
rebound effect to buy more goods and services, which indirectly 
increases the use of energy (i.e., the indirect rebound effect).\823\ 
The commenter states that the indirect rebound effect represents a 
positive economic result for consumers, since consumer welfare 
increases, although it could result in increased energy use and GHG 
emissions. We agree with the commenter's observation that, to the 
extent that indirect rebound does occur, it could have both positive 
and negative impacts.
---------------------------------------------------------------------------

    \823\ EPA-HQ-OAR-2014-0827-1336.
---------------------------------------------------------------------------

    Another commenter suggested that the indirect or economy-wide 
rebound effect could be large enough so as to fully offset the fuel 
savings and GHG emissions benefits of the rule.\824\ The commenter 
provides multiple estimates of the potential size of the indirect 
rebound effect. However, the unpublished methodology used to perform 
these estimates has not undergone peer review and, as explained in the 
response to comment

[[Page 73873]]

document, the agencies find it to be dubious. Further, as discussed in 
detail in the proposal rule and our response to comment document, there 
are a number of other important questions not addressed by the 
commenter that must be examined before we can have enough confidence in 
these kinds of estimates to include them in our economic analysis.
---------------------------------------------------------------------------

    \824\ EPA-HQ-OAR-2014-0827-1467.
---------------------------------------------------------------------------

    As discussed in this rule, all of the fuel costs savings will not 
necessarily be passed through to the consumer in terms of cheaper goods 
and services. First, there may be market barriers that impede trucking 
companies from passing along the fuel cost savings from the rule in the 
form of lower rates. Second, there are upfront vehicle costs (and 
potentially transaction or transition costs associated with the 
adoption of new technologies) that would partially offset some of the 
fuel cost savings from our rule, thereby limiting the magnitude of the 
impact on prices of final goods and services. Also, it is not clear how 
the fuel savings from the rule would be utilized by trucking firms. For 
example, trucking firms may reinvest fuel savings in their own company; 
retain fuel savings as profits; pass fuel savings onto customers or 
others; or increase driver pay. Finally, it is not clear how the 
different pathways that fuel savings would be utilized would affect 
greenhouse gas emissions.
    Research on indirect and economy-wide rebound effects is scant, and 
we have not identified any peer-reviewed research that attempts to 
quantify indirect or economy-wide rebound effects for HDVs. In 
particular, the agencies are not aware of any peer-reviewed approach 
which indicates that the magnitude of indirect or economy-wide rebound 
effects, if any, would be significant for this final rule.\825\ 
Therefore, we rely on the analysis of vehicle miles traveled to 
estimate the rebound effect in this rule, as we did for the HD Phase 1 
rule, where we attempted to quantify only rebound effects from our rule 
that impact HDV VMT.
---------------------------------------------------------------------------

    \825\ The same entity responsible for these comments also sought 
reconsideration of the Phase 1 rule on the grounds that indirect 
rebound effects had not been considered by the agencies and could 
negate all of the benefits of the standards. This assertion rested 
on an unsupported affidavit lacking any peer review or other indicia 
of objectivity. This affidavit cited only one published study. The 
study cited did not deal with vehicle efficiency, has methodological 
limitations (many of them acknowledged), and otherwise was not 
pertinent. EPA and NHTSA thus declined to reconsider the Phase 1 
rule based on these speculative assertions. See generally 77 FR 
51703-51704, August 27, 2012 and 77 FR 51502-51503, August 24, 2012. 
The analysis in this entity's comments on this rulemaking rests 
largely on that same unsupported affidavit.
---------------------------------------------------------------------------

    In order to test the effect of alternative assumptions about the 
rebound effect, NHTSA examined the sensitivity of its estimates of 
benefits and costs of the proposed Phase 2 program for HD pickups and 
vans to alternative assumptions about the rebound effect. While the 
main analysis for pickups and vans assumes a 10 percent rebound effect, 
the sensitivity analysis estimates the benefits and costs of these 
standards under the assumptions of 5, 15, and 20 percent rebound 
effects. This sensitivity analysis can be found in Section IX.E.3 of 
the NPRM Preamble \826\ and shows that (a) using a 5 percent value for 
the rebound effect reduced benefits and costs of the proposed standards 
by identical amounts, leaving net benefits unaffected; and (b) rebound 
effects of 15 percent and 20 percent increased costs and reduced 
benefits compared to their values in the main analysis, thus reducing 
net benefits of the proposed standards. Nevertheless, the proposed and 
now the final program have significant net benefits and these 
alternative values of the rebound effect would not have affected the 
agencies' selection of the final program stringency, as that selection 
is based on NHTSA's assessment of the maximum feasible fuel efficiency 
standards and EPA's selection of appropriate GHG standards to address 
energy security and the environment.
---------------------------------------------------------------------------

    \826\ 80 FR 40137.
---------------------------------------------------------------------------

F. Impact on Class Shifting, Fleet Turnover, and Sales

    The agencies considered two additional potential indirect effects 
which may lead to unintended consequences of the program to improve the 
fuel efficiency and reduce GHG emissions from HD trucks. The next 
sections cover the agencies' qualitative discussions on potential class 
shifting and fleet turnover effects.
(1) Class Shifting
    Heavy-duty vehicles are typically configured and purchased to 
perform a function. For example, a concrete mixer truck is purchased to 
transport concrete, a combination tractor is purchased to move freight 
with the use of a trailer, and a Class 3 pickup truck could be 
purchased by a landscape company to pull a trailer carrying lawnmowers. 
The purchaser makes decisions based on many attributes of the vehicle, 
including the gross vehicle weight rating of the vehicle, which in part 
determines the amount of freight or equipment that can be carried. If 
the Phase 2 standards impact either the performance of the vehicle or 
the marginal cost of the vehicle relative to the other vehicle classes, 
then consumers may choose to purchase a different vehicle, resulting in 
the unintended consequence of increased fuel consumption and GHG 
emissions in-use.
    The agencies, along with the NAS panel, found that there is little 
or no literature which evaluates class shifting between trucks.\827\ In 
addition, the agencies did not receive comments specifically raising 
concerns about class shifting. NHTSA and EPA qualitatively evaluated 
the final rules in light of potential class shifting. The agencies 
looked at four potential cases of shifting: From light-duty pickup 
trucks to heavy-duty pickup trucks; from sleeper cabs to day cabs; from 
combination tractors to vocational vehicles; and within vocational 
vehicles.
---------------------------------------------------------------------------

    \827\ See 2010 NAS Report, page 152.
---------------------------------------------------------------------------

    Light-duty pickup trucks, those with a GVWR of less than 8,500 lbs, 
are currently regulated under the existing GHG/CAFE standards for light 
duty vehicles. The increased stringency of the light-duty 2017-2025 MY 
vehicle rule has led some to speculate that vehicle consumers may 
choose to purchase heavy-duty pickup trucks that are currently 
regulated under the HD Phase 1 program if the cost of the light-duty 
regulation is high relative to the cost to buy the larger heavy-duty 
pickup trucks. Since fuel consumption and GHG emissions rise 
significantly with vehicle mass, a shift from light-duty trucks to 
heavy-duty trucks would likely lead to higher fuel consumption and GHG 
emissions, an untended consequence of the regulations. Given the 
significant price premium of a heavy-duty truck (often five to ten 
thousand dollars more than a light-duty pickup), we believe that such a 
class shift would be unlikely whether or not this program exited. These 
final rules would continue to diminish any incentive for such a class 
shift because they would narrow the GHG and fuel efficiency performance 
gap between light-duty and heavy-duty pickup trucks. The regulations 
for the HD pickup trucks, and similarly for vans, are based on similar 
technologies and therefore reflect a similar expected increase in cost 
when compared to the light-duty GHG regulation. Hence, the combination 
of the two regulations provides little incentive for a shift from 
light-duty trucks to HD trucks. To the extent that this regulation of 
heavy-duty pickups and vans could conceivably encourage a class shift 
towards lighter pickups, this unintended consequence

[[Page 73874]]

would in fact be expected to lead to lower fuel consumption and GHG 
emissions as the smaller light-duty pickups have significantly better 
fuel economy ratings than heavy-duty pickup trucks.
    The projected cost increases for this action differ between Class 8 
day cabs and Class 8 sleeper cabs, reflecting our conservative 
assumption for purposes of this analysis on shifting that compliance 
with these standards would lead truck consumers to specify sleeper cabs 
equipped with APUs or alternatives to APU while day cab consumers would 
not. Since Class 8 day cab and sleeper cab trucks perform essentially 
the same function when hauling a trailer, this raises the possibility 
that the additional cost for an APU or alternatives to APU equipped 
sleeper cab could lead to a shift from sleeper cab to day cab trucks. 
We do not believe that such an intended consequence would occur for the 
following reasons. The addition of a sleeper berth to a tractor cab is 
not a consumer-selectable attribute in quite the same way as other 
vehicle features. The sleeper cab provides a utility that long-distance 
trucking fleets need to conduct their operations--an on-board sleeping 
berth that lets a driver comply with federally-mandated rest periods, 
as required by the Department of Transportation Federal Motor Carrier 
Safety Administration's hours-of-service regulations. The cost of 
sleeper trucks is already higher than the cost of day cabs, yet the 
fleets that need this utility purchase them.\828\ A day cab simply 
cannot provide this utility with a single driver. The need for this 
utility would not be changed even if the additional costs to reduce 
greenhouse gas emissions from sleeper cabs exceed those for reducing 
greenhouse gas emissions from day cabs.\829\
---------------------------------------------------------------------------

    \828\ A baseline tractor price of a new day cab is $89,500 
versus $113,000 for a new sleeper cab based on information gathered 
by ICF in the ``Investigation of Costs for Strategies to Reduce 
Greenhouse Gas Emissions for Heavy-Duty On-Road Vehicles,'' July 
2010. Page 3. Docket Identification Number EPA-HQ-OAR-2014--0827.
    \829\ The average marginal cost difference between sleeper cabs 
and day cabs in the rule is roughly $2,500.
---------------------------------------------------------------------------

    A trucking fleet could instead decide to put its drivers in hotels 
in lieu of using sleeper berths, and switch to day cabs. However, this 
is unlikely to occur in any great number, since the added cost for the 
hotel stays would far overwhelm differences in the marginal cost 
between day and sleeper cabs. Even if some fleets do opt to buy hotel 
rooms and switch to day cabs, they would be highly unlikely to purchase 
a day cab that was aerodynamically worse than the sleeper cab they 
replaced, since the need for features optimized for long-distance 
hauling would not have changed. So in practice, there would likely be 
little difference to the environment for any switching that might 
occur. Further, while our projected costs in the NPRM assumed the 
purchase of an APU for compliance for nearly all sleeper cabs, the 
updated analysis reflects additional flexibility in the final rules 
that would allow manufacturers to use several other alternatives to 
APUs that would be much less expensive. Thus, even though we are now 
projecting that APU costs will be somewhat higher than what we 
projected for the NPRM, manufacturers and consumers will not be 
required to use them. In fact, this regulatory structure would allow 
compliance using a near zero cost software utility that eliminates 
tractor idling after five minutes. Using this compliance approach, the 
cost difference between a Class 8 sleeper cab and day cab due to these 
regulations is small. We are proposing this alternative compliance 
approach reflecting that some sleeper cabs are used in team driving 
situations where one driver sleeps while the other drives. In that 
situation, an APU is unnecessary since the tractor is continually being 
driven when occupied. When it is parked, it would automatically 
eliminate any additional idling through the shutdown software. If 
trucking businesses choose this option, then costs based on purchase of 
APUs may overestimate the costs of this program to this sector.
    Class shifting from combination tractors to vocational vehicles may 
occur if a customer deems the additional marginal cost of tractors due 
to the regulation to be greater than the utility provided by the 
tractor. The agencies initially considered this issue when deciding 
whether to include Class 7 tractors with the Class 8 tractors or 
regulate them as vocational vehicles. The agencies' evaluation of the 
combined vehicle weight rating of the Class 7 shows that if these 
vehicles were treated significantly differently from the Class 8 
tractors, then they could be easily substituted for Class 8 tractors. 
Therefore, the agencies will continue to include both classes in the 
tractor category. The agencies believe that a shift from tractors to 
vocational vehicles would be limited because of the ability of tractors 
to pick up and drop off trailers at locations which cannot be done by 
vocational vehicles.
    The agencies do not envision that the regulatory program would 
cause class shifting within the vocational vehicle class. As vocational 
vehicles include a wide variety of vehicle types, and serve a wide 
range of functions, the diversity in the vocational vehicle segment can 
be primarily attributed to the variety of customer needs for 
specialized vehicle bodies and added equipment, rather than to the 
chassis. The new standards are projected to lead to a small increase in 
the incremental cost per vehicle. However, these cost increases are 
consistent across the board for both vocational vehicles and the 
engines used in the vehicle (Table V-30 at Preamble Section 
V.C.(2)(e)). The agencies believe that the utility gained from the 
additional technology package would outweigh the additional cost for 
vocational vehicles.\830\
---------------------------------------------------------------------------

    \830\ The final rule projects the average per-vehicle costs 
associated with the 2027 MY standards to be generally less than five 
percent of the overall price of a new vehicle. The cost-
effectiveness of these vocational vehicle standards in dollars per 
ton is similar to the cost effectiveness estimated for light-duty 
trucks in the 2017-2025 light duty greenhouse gas standards 
(Preamble section V.C.3).
---------------------------------------------------------------------------

    In conclusion, NHTSA and EPA believe that the regulatory structure 
for HD vehicles and engines would not significantly change the current 
competitive and market factors that determine purchaser preferences. 
Furthermore, even if a small amount of shifting would occur, any 
resulting GHG impacts would likely to be negligible because any vehicle 
class that sees an uptick in sales is also being regulated for GHG 
emission control and fuel efficiency. Therefore, the agencies did not 
include an impact of class shifting on the vehicle populations used to 
assess the benefits of the program.
(2) Fleet Turnover and Sales Effects
    A regulation that affects the cost to purchase and/or operate 
trucks could affect whether a consumer decides to purchase a new truck 
and the timing of that purchase. The term pre-buy refers to the idea 
that truck purchases may occur earlier than otherwise planned to avoid 
the additional costs associated with a new regulatory requirement. 
Slower fleet turnover, or low-buys, may occur when owners opt to keep 
their existing truck rather than purchase a new truck due to the 
incremental cost of the regulation.
    Several commenters raised the possibility of pre-buy for these 
standards. Allison Transmission, the National Automobile Dealers 
Association, the Owner-Operator Independent Drivers Association, and 
the Truck Renting and Leasing Association point toward pre-buy 
associated with standards from the 2000s for nitrogen oxides 
(NOX) regulations as evidence of the likelihood

[[Page 73875]]

of pre-buy for vehicle GHG and fuel efficiency standards. Daimler 
Trucks North America, the International Union, United Automobile, 
Aerospace, and Agricultural Implement Workers of America, and the Truck 
and Engine Manufacturers Association express concern about pre-buy 
specifically in the context of NPRM Alternative 4, due to concerns that 
the time frame for technology development and adoption was too short. 
Daimler Trucks and the Environmental Defense Fund note that Phase 1 did 
not appear to result in pre-buy. Volvo Group notes that the phase-in 
approach of Phase 1 plus the flexibilities available eased the 
transition to new technologies, and that gradual market acceptance of 
new technologies will lead to less disruption than an accelerated 
program. The Recreational Vehicle Industry Association expressed 
concern that the standards will have a negative effect on recreational 
vehicle sales.
    The 2010 NAS HD Report discussed the topics associated with medium- 
and heavy-duty vehicle fleet turnover. NAS noted that there is some 
empirical evidence of pre-buy behavior in response to the 2004 and 2007 
heavy-duty engine emission standards, with larger impacts occurring in 
response to higher costs.\831\ However, those regulations increased 
upfront costs to firms without any offsetting future cost savings from 
reduced fuel purchases. In summary, NAS stated that:
---------------------------------------------------------------------------

    \831\ Committee to Assess Fuel Economy Technologies for Medium- 
and Heavy-Duty Vehicles; National Research Council; Transportation 
Research Board (2010). ``Technologies and Approaches to Reducing the 
Fuel Consumption of Medium- and Heavy-Duty Vehicles,'' (hereafter, 
``NAS Report''). Washington, DC, the National Academies Press. 
Available electronically from the National Academies Press Web site 
at http://www.nap.edu/catalog.php?record_id=12845., pp. 150-151, 
Docket EPA-HQ-OAR-2014-0827-0276.

    . . . during periods of stable or growing demand in the freight 
sector, pre-buy behavior may have significant impact on purchase 
patterns, especially for larger fleets with better access to capital 
and financing. Under these same conditions, smaller operators may 
simply elect to keep their current equipment on the road longer, all 
the more likely given continued improvements in diesel engine 
durability over time. On the other hand, to the extent that fuel 
economy improvements can offset incremental purchase costs, these 
impacts will be lessened. Nevertheless, when it comes to efficiency 
investments, most heavy-duty fleet operators require relatively quick 
payback periods, on the order of two to three years.\832\
---------------------------------------------------------------------------

    \832\ See NAS Report, Note 831, page 151, Docket EPA-HQ-OAR-
2014-0827-0276.

    The regulations are projected to return fuel savings to the vehicle 
owners that offset the cost of the regulation within a few years. The 
effects of the regulation on purchasing behavior and sales will depend 
on the nature of the market failures and the extent to which firms 
consider the projected future fuel savings in their purchasing 
decisions.
    If trucking firms or other buyers account for the rapid payback, 
they are unlikely to strategically accelerate or delay their purchase 
plans at additional cost in capital to avoid a regulation that will 
lower their overall operating costs. As discussed in Section IX.A., 
this scenario may occur if this program reduces uncertainty about fuel-
saving technologies. More reliable information about ways to reduce 
fuel consumption allows truck purchasers to evaluate better the 
benefits and costs of additional fuel savings, primarily in the 
original vehicle market, but possibly in the resale market as well. In 
addition, these standards are expected to lead manufacturers to install 
more fuel-saving technologies and promote their purchase; the increased 
availability and promotion may encourage sales.
    Other market failures may leave open the possibility of some pre-
buy or delayed purchasing behavior. Firms may not consider the full 
value of the future fuel savings for several reasons. For instance, 
truck purchasers may not want to invest in fuel efficiency because of 
uncertainty about fuel prices. Another explanation is that the resale 
market may not fully recognize the value of fuel savings, due to lack 
of trust of new technologies or changes in the uses of the vehicles. 
Lack of coordination (also called split incentives--see Section IX.A) 
between truck purchasers (who may emphasize the up-front costs of the 
trucks) and truck operators, who like the fuel savings, can also lead 
to pre-buy or delayed purchasing behavior. If these market failures 
prevent firms from fully internalizing fuel savings when deciding on 
vehicle purchases, then pre-buy and delayed purchase could occur and 
could result in a slight decrease in the GHG benefits of the 
regulation.
    Thus, whether pre-buy or delayed purchase is likely to play a 
significant role in the truck market depends on the specific behaviors 
of purchasers in that market. Without additional information about 
which scenario is more likely to be prevalent, the agencies are not 
projecting a change in fleet turnover characteristics due to this 
regulation.
    Industry purchasing in relation to the advent of the Phase 1 
standards offers at least some insight into the impacts of these 
standards. The Environmental Defense Fund observes that MY 2014 heavy-
duty trucks had the highest sales since 2005. Any trends in sales are 
likely to be affected by macroeconomic conditions, which have been 
recovering since 2009-2010. The standards may have affected sales, but 
the size of that effect is likely to be swamped by the effects of the 
economic recovery. It is unlikely to be possible to separate the 
effects of the existing standards from other confounding factors.

G. Monetized GHG Impacts

(1) Monetized CO2 Impacts--The Social Cost of Carbon (SC-
CO2)
    We estimate the global social benefits of CO2 emission 
reductions expected from the heavy-duty GHG and fuel efficiency 
standards using the social cost of carbon (SC-CO2) estimates 
presented in the Technical Support Document: Technical Update of the 
Social Cost of Carbon for Regulatory Impact Analysis Under Executive 
Order 12866 (May 2013, Revised July 2015) (``current SC-CO2 
TSD'').\833\ (The SC-CO2 estimates are presented in Table 
IX-11). We refer to these estimates, which were developed by the U.S. 
government, as ``SC-CO2 estimates.'' The SC-CO2 
is a metric that estimates the monetary value of impacts associated 
with marginal changes in CO2 emissions in a given year. It 
includes a wide range of anticipated climate impacts, such as net 
changes in agricultural productivity and human health, property damage 
from increased flood risk, and changes in energy system costs, such as 
reduced costs for heating and increased costs for air conditioning. It 
is typically used to assess the avoided damages as a result of 
regulatory actions (i.e., benefits of rulemakings that lead to an 
incremental reduction in cumulative global CO2 emissions).
---------------------------------------------------------------------------

    \833\ Technical Support Document: Technical Update of the Social 
Cost of Carbon for Regulatory Impact Analysis Under Executive Order 
12866 (May 2013, Revised July 2015), Interagency Working Group on 
Social Cost of Carbon, with participation by Council of Economic 
Advisers, Council on Environmental Quality, Department of 
Agriculture, Department of Commerce, Department of Energy, 
Department of Transportation, Environmental Protection Agency, 
National Economic Council, Office of Energy and Climate Change, 
Office of Management and Budget, Office of Science and Technology 
Policy, and Department of Treasury. Available at: https://www.whitehouse.gov/sites/default/files/omb/inforeg/scc-tsd-final-july-2015.pdf.
---------------------------------------------------------------------------

    The SC-CO2 estimates used in this analysis were 
developed over many

[[Page 73876]]

years, using the best science available, and with input from the 
public. Specifically, an interagency working group (IWG) that included 
EPA, DOT, and other executive branch agencies and offices used three 
integrated assessment models (IAMs) to develop the SC-CO2 
estimates and recommended four global values for use in regulatory 
analyses. The SC-CO2 estimates were first released in 
February 2010 and updated in 2013 using new versions of each IAM. The 
2013 update did not revisit the 2010 modeling decisions (e.g., with 
regard to the discount rate, reference case socioeconomic and emission 
scenarios or equilibrium climate sensitivity). Rather, improvements in 
the way damages are modeled are confined to those that have been 
incorporated into the latest versions of the models by the developers 
themselves and used for analyses in peer-reviewed publications. The 
2010 SC-CO2 Technical Support Document (2010 SC-
CO2 TSD) provides a complete discussion of the methods used 
to develop these estimates and the current SC-CO2 TSD 
presents and discusses the update (including recent minor technical 
corrections to the estimates).\834\
---------------------------------------------------------------------------

    \834\ Both the 2010 SC-CO2 TSD and the current TSD 
are available at: https://www.whitehouse.gov/omb/oira/social-cost-of-carbon. The 2010 SC-CO2 TSD also available in the 
docket: Docket ID EPA-HQ-OAR-2009-0472-114577, Technical Support 
Document: Social Cost of Carbon for Regulatory Impact Analysis Under 
Executive Order 12866, Interagency Working Group on Social Cost of 
Carbon, with participation by the Council of Economic Advisers, 
Council on Environmental Quality, Department of Agriculture, 
Department of Commerce, Department of Energy, Department of 
Transportation, Environmental Protection Agency, National Economic 
Council, Office of Energy and Climate Change, Office of Management 
and Budget, Office of Science and Technology Policy, and Department 
of Treasury (February 2010). Also available at: http://www.whitehouse.gov/sites/default/files/omb/inforeg/for-agencies/Social-Cost-of-Carbon-for-RIA.pdf.
---------------------------------------------------------------------------

    The 2010 SC-CO2 TSD noted a number of limitations to the 
SC-CO2 analysis, including the incomplete way in which the 
IAMs capture catastrophic and non-catastrophic impacts, their 
incomplete treatment of adaptation and technological change, 
uncertainty in the extrapolation of damages to high temperatures, and 
assumptions regarding risk aversion. Currently IAMs do not assign value 
to all of the important physical, ecological, and economic impacts of 
climate change recognized in the climate change literature due to a 
lack of precise information on the nature of damages and because the 
science incorporated into these models understandably lags behind the 
most recent research. Nonetheless, these estimates and the discussion 
of their limitations represent the best available information about the 
social benefits of CO2 reductions to inform benefit-cost 
analysis; see RIA of this rule and the SC-CO2 TSDs for 
additional details. The new versions of the models used to estimate the 
values presented below offer some improvements in these areas, although 
further work is warranted.
    Accordingly, EPA and other agencies continue to engage in research 
on modeling and valuation of climate impacts with the goal to improve 
these estimates. The EPA and other federal agencies also continue to 
consider feedback on the SC-CO2 estimates from stakeholders 
through a range of channels, including public comments on Agency 
rulemakings that use the SC-CO2 in supporting analyses and 
through regular interactions with stakeholders and research analysts 
implementing the SC-CO2 methodology used by the IWG. The SC-
CO2 comments received on this rulemaking covered the 
technical details of the modeling conducted to develop the SC-
CO2 estimates and some also provided constructive 
recommendations for potential opportunities to improve the SC-
CO2 estimates in future updates. EPA has carefully 
considered all of these comments and continues to conclude that the 
current estimates represent the best scientific information on the 
impacts of climate change available in a form appropriate for 
incorporating the damages from incremental CO2 emissions 
changes into regulatory analysis. Therefore, EPA has presented the 
current SC-CO2 estimates in this rulemaking. See Section 
11.8 of the RTC document for a summary of and response to the SC-
CO2 comments submitted to this rulemaking. In addition, OMB 
sought public comment on the approach used to develop the SC-
CO2 estimates through a separate comment period and 
published a response to those comments in 2015.\835\
---------------------------------------------------------------------------

    \835\ See https://www.whitehouse.gov/sites/default/files/omb/inforeg/scc-response-to-comments-final-july-2015.pdf.
---------------------------------------------------------------------------

    After careful evaluation of the full range of comments submitted to 
OMB, the IWG continues to recommend the use of the SC-CO2 
estimates in regulatory impact analysis. With the July 2015 release of 
the response to comments, the IWG announced plans to obtain expert 
independent advice from the National Academies of Sciences, Engineering 
and Medicine to ensure that the SC-CO2 estimates continue to 
reflect the best available scientific and economic information on 
climate change. The Academies then convened a committee, ``Assessing 
Approaches to Updating the Social Cost of Carbon,'' (Committee) which 
is reviewing the state of the science on estimating the SC-
CO2, and will provide expert, independent advice on the 
merits of different technical approaches for modeling and highlight 
research priorities going forward. EPA will evaluate its approach based 
upon any feedback received from the Academies' panel.
    To date, the Committee has released an interim report, which 
recommended against doing a near term update of the SC-CO2 
estimates. For future revisions, the Committee recommended the IWG move 
efforts towards a broader update of the climate system module 
consistent with the most recent, best available science, and also 
offered recommendations for how to enhance the discussion and 
presentation of uncertainty in the SC-CO2 estimates. 
Specifically, the Committee recommended that ``the IWG provide guidance 
in their technical support documents about how [SC-CO2] 
uncertainty should be represented and discussed in individual 
regulatory impact analyses that use the [SC-CO2]'' and that 
the technical support document for each update of the estimates present 
a section discussing the uncertainty in the overall approach, in the 
models used, and uncertainty that may not be included in the estimates. 
At the time of this writing, the IWG is reviewing the interim report 
and considering the recommendations. EPA looks forward to working with 
the IWG to respond to the recommendations and will continue to follow 
IWG guidance on SC-CO2.
    The four global SC-CO2 estimates are as follows: $13, 
$46, $68, and $140 per metric ton of CO2 emissions in the 
year 2020 (2013$).\836\ The first three values are based on the average 
SC-CO2 from the three IAMs, at discount rates of 5, 3, and 
2.5 percent, respectively. SC-CO2 estimates for several 
discount rates are included because the literature shows that the SC-
CO2 is quite sensitive to assumptions about the discount 
rate, and because no consensus exists on the appropriate rate to use in 
an intergenerational context (where costs and benefits are incurred by 
different generations). The fourth value is the 95th percentile of the 
SC-CO2 from all three models at a 3 percent discount rate. 
It is included to represent lower probability but higher outcomes from

[[Page 73877]]

climate change, which are captured further out in the tail of the SC-
CO2 distribution, and while less likely than those reflected 
by the average SC-CO2 estimates, would be much more harmful 
to society and therefore, are relevant to policy makers. The SC-
CO2 increases over time because future emissions are 
expected to produce larger incremental damages as economies grow and 
physical and economic systems become more stressed in response to 
greater climate change. The SC-CO2 values are presented in 
Table IX-11.
---------------------------------------------------------------------------

    \836\ The current SC-CO2 TSD presents the SC-
CO2 estimates in $2007. These estimates were adjusted to 
2013$ using the GDP Implicit Price Deflator. Bureau of Economic 
Analysis, Table 1.1.9 Implicit Price Deflators for Gross Domestic 
Product; last revised on September 25, 2015.
---------------------------------------------------------------------------

    Applying the global SC-CO2 estimates, shown in Table, to 
the estimated reductions in domestic CO2 emissions for the 
program, yields estimates of the dollar value of the climate related 
benefits for each analysis year. These estimates are then discounted 
back to the analysis year using the same discount rate used to estimate 
the SC-CO2. For internal consistency, the annual benefits 
are discounted back to net present value terms using the same discount 
rate as each SC-CO2 estimate (i.e., 5 percent, 3 percent, 
and 2.5 percent) rather than the discount rates of 3 percent and 7 
percent used to derive the net present value of other streams of costs 
and benefits of the final rule.\837\ The SC-CO2 benefit 
estimates for each calendar year are shown in Table. The SC-
CO2 benefit estimates for each model year are shown in Table 
IX-13.
---------------------------------------------------------------------------

    \837\ See more discussion on the appropriate discounting of 
climate benefits using SC-CO2 in the 2010 SCC TSD. Other 
benefits and costs of proposed regulations unrelated to 
CO2 emissions are discounted at the 3% and 7% rates 
specified in OMB guidance for regulatory analysis.

                              Table IX-11--Social Cost of CO[ihel2], 2012-2050 \a\
                                            [in 2013$ per Metric Ton]
----------------------------------------------------------------------------------------------------------------
                                                                                                     3%, 95th
                  Calendar year                     5% Average      3% Average     2.5% Average     Percentile
----------------------------------------------------------------------------------------------------------------
2012............................................             $12             $36             $58            $100
2015............................................              12              40              62             120
2020............................................              13              46              68             140
2025............................................              15              51              75             150
2030............................................              18              55              80             170
2035............................................              20              60              86             180
2040............................................              23              66              92             200
2045............................................              25              70              98             220
2050............................................              29              76             100             230
----------------------------------------------------------------------------------------------------------------
Note:
\a\ The SC-CO[ihel2] values are dollar-year and emissions-year specific and have been rounded to two significant
  digits. Unrounded numbers from the current SC-CO[ihel2] TSD were used to calculate the CO[ihel2] benefits.


Table IX-12--Upstream and Downstream Annual CO[ihel2] Benefits for the Given SC-CO[ihel2] Value a Using Method B
                                        and Relative to the Flat Baseline
                                             [Millions of 2013$] \b\
----------------------------------------------------------------------------------------------------------------
                                                                                                      3% 95th
                  Calendar year                     5% average      3% average     2.5% average     percentile
----------------------------------------------------------------------------------------------------------------
2018............................................              $7             $22             $33             $63
2019............................................              13              46              68             130
2020............................................              21              73             110             210
2021............................................              80             280             420             840
2022............................................             170             550             820           1,700
2023............................................             250             850           1,300           2,600
2024............................................             390           1,300           2,000           4,000
2025............................................             560           1,800           2,700           5,500
2026............................................             700           2,400           3,500           7,100
2027............................................             950           3,000           4,400           9,100
2028............................................           1,100           3,700           5,400          11,000
2029............................................           1,300           4,300           6,400          13,000
2030............................................           1,600           5,000           7,300          15,000
2035............................................           2,700           8,100          11,000          25,000
2040............................................           3,700          11,000          15,000          33,000
2050............................................           5,500          15,000          20,000          45,000
NPV.............................................          24,000         110,000         180,000         340,000
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ The SC-CO[ihel2] values are dollar-year and emissions-year specific.
\b\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


[[Page 73878]]


    Table IX-13--Upstream and Downstream Discounted Model Year Lifetime CO[ihel2] Benefits for the Given SC-
                        CO[ihel2] Value Using Method B and Relative to the Flat Baseline
                                             [Millions of 2013$] a b
----------------------------------------------------------------------------------------------------------------
                                                                                                      3% 95th
                   Model year                       5% average      3% average     2.5% average     percentile
----------------------------------------------------------------------------------------------------------------
2018............................................             $38            $150            $230            $450
2019............................................              36             140             220             430
2020............................................              34             140             220             420
2021............................................             560           2,300           3,600           7,000
2022............................................             590           2,500           3,900           7,500
2023............................................             610           2,600           4,000           7,800
2024............................................             920           4,000           6,200          12,000
2025............................................             940           4,100           6,400          12,000
2026............................................             950           4,200           6,600          13,000
2027............................................           1,200           5,400           8,500          16,000
2028............................................           1,200           5,300           8,400          16,000
2029............................................           1,200           5,300           8,400          16,000
Sum.............................................           8,200          36,000          57,000         110,000
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ The SC-CO[ihel2] values are dollar-year and emissions-year specific.
\b\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

(2) Monetized Non-CO2 GHG Impacts
    EPA calculated the global social benefits of CH4 and 
N2O emissions reductions expected from the final rulemaking 
using estimates of the social cost of methane (SC-CH4) and 
the social cost of nitrous oxide (SC-N2O). Similar to the 
SC-CO2, the SC-CH4 and SC-N2O estimate 
the monetary value of impacts associated with marginal changes in 
CH4 and N2O emissions, respectively, in a given 
year. Each metric includes a wide range of anticipated climate impacts, 
such as net changes in agricultural productivity and human health, 
property damage from increased flood risk, and changes in energy system 
costs, such as reduced costs for heating and increased costs for air 
conditioning. The SC-CH4 and SC-N2O estimates 
applied in this analysis were developed by Marten et al. (2014) and are 
discussed in greater detail below. EPA is unaware of analogous 
estimates of HFC-134a and has therefore presented a sensitivity 
analysis, separate from the main benefit cost analysis, that 
approximates the benefits of HFC-134a reductions based on global 
warming potential (GWP) gas comparison metrics (``GWP approach''). 
Other unquantified non-CO2 benefits are discussed in this 
section as well. Additional details are provided in the RIA of these 
rules.
(a) Monetized CH4 and N2O Impacts
    As discussed in the proposed rulemaking, a challenge particularly 
relevant to the monetization of non-CO2 GHG impacts is that 
the IWG did not estimate the social costs of non-CO2 GHG 
emissions at the time the SC-CO2 estimates were developed. 
While there are other estimates of the social cost of non-
CO2 GHGs in the peer review literature, none of those 
estimates are consistent with the SC-CO2 estimates developed 
by the IWG and most are likely underestimates due to changes in the 
underlying science subsequent to their publication.\838\
---------------------------------------------------------------------------

    \838\ As discussed in the RIA, there is considerable variation 
among these published estimates in the models and input assumptions 
they employ. These studies differ in the emission perturbation year, 
employ a wide range of constant and variable discount rate 
specifications, and consider a range of baseline socioeconomic and 
emissions scenarios that have been developed over the last 20 years. 
See also Reilly and Richards, 1993; Schmalensee, 1993; Fankhauser, 
1994; Marten and Newbold, 2012.
---------------------------------------------------------------------------

    However, in the time leading up to the proposal for this 
rulemaking, a paper by Marten et al. (2014) provided the first set of 
published SC-CH4 and SC-N2O estimates in the 
peer-reviewed literature that are consistent with the modeling 
assumptions the IWG used to develop the SC-CO2 
estimates.\839\ Specifically, the estimation approach of Marten et al. 
(2014) used the same set of three IAMs, five socioeconomic-emissions 
scenarios, equilibrium climate sensitivity distribution, three constant 
discount rates, and aggregation approach used to develop the SC-
CO2 estimates. Marten et al. also used the same rationale as 
the IWG to develop global estimates of the SC-CH4 and the 
SC-N2O, given that CH4 and N2O are 
global pollutants.
---------------------------------------------------------------------------

    \839\ Marten, A.L., E.A. Kopits, C.W. Griffiths, S.C. Newbold & 
A. Wolverton (2014). Incremental CH4 and N2O 
mitigation benefits consistent with the U.S. Government's SC-
CO2 estimates, Climate Policy, DOI: 10.1080/
14693062.2014.912981.
---------------------------------------------------------------------------

    The resulting SC-CH4 and SC-N2O estimates are 
presented in Table IX-14. More detailed discussion of their 
methodology, results and a comparison to other published estimates can 
be found in the RIA and in Marten et al. (2014).

                                                                   Table IX-14--Social Cost of CH4 and N[ihel2]O, 2012-2050 a
                                                                    [In 2013$ per metric ton] [Source: Marten et al., 2014 b]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                              SC-CH4                                                       SC-N[ihel2]O
                                                                 -------------------------------------------------------------------------------------------------------------------------------
                              Year                                                                                    3% 95th                                                         3% 95th
                                                                    5% average      3% average     2.5% average     percentile      5% average      3% average     2.5% average     percentile
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
2012............................................................            $440          $1,000          $1,400          $2,800          $4,000         $14,000         $21,000         $36,000
2015............................................................             490           1,100           1,500           3,100           4,400          14,000          22,000          38,000
2020............................................................             590           1,300           1,800           3,500           5,200          16,000          24,000          43,000
2025............................................................             710           1,500           2,000           4,100           6,000          19,000          26,000          48,000
2030............................................................             830           1,800           2,200           4,600           6,900          21,000          30,000          54,000
2035............................................................             990           2,000           2,500           5,400           8,100          23,000          32,000          60,000

[[Page 73879]]

 
2040............................................................           1,100           2,200           2,900           6,000           9,200          25,000          35,000          66,000
2045............................................................           1,300           2,500           3,100           6,700          10,000          27,000          37,000          73,000
2050............................................................           1,400           2,700           3,400           7,400          12,000          30,000          41,000          79,000
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ The values are emissions-year specific and have been rounded to two significant digits. Unrounded numbers were used to calculate the GHG benefits.
\b\ The estimates in this table have been adjusted to reflect the minor technical corrections to the SC-CO[ihel2] estimates described above. See the Corrigendum to Marten et al. (2014), http://www.tandfonline.com/doi/abs/10.1080/14693062.2015.1070550.

    In addition to requesting comment on these estimates in the 
proposed rulemaking, EPA noted that it had initiated a peer review of 
the application of the Marten et al (2014) non-CO2 social 
cost estimates in regulatory analysis.\840\ EPA also stated that, 
pending a favorable peer review, it planned to use the Marten et al 
(2014) estimates to monetize benefits of CH4 and 
N2O emission reduction in the main benefit-cost analysis of 
the final rule.
---------------------------------------------------------------------------

    \840\ For a copy of the peer review and the responses, see 
https://cfpub.epa.gov/si/si_public_pra_view.cfm?dirEntryID=291976 
(see ``SCCH4 EPA PEER REVIEW FILES.PDF'').
---------------------------------------------------------------------------

    Since then, EPA received responses that supported use of the Marten 
et al. estimates. Three reviewers considered seven charge questions 
that covered issues such as the EPA's interpretation of the Marten et 
al. estimates, the consistency of the estimates with the SC-
CO2 estimates, the EPA's characterization of the limits of 
the GWP-approach to value non-CO2 GHG impacts, and the 
appropriateness of using the Marten et al. estimates in regulatory 
impact analyses. The reviewers agreed with the EPA's interpretation of 
Marten et al.'s estimates, generally found the estimates to be 
consistent with the SC-CO2 estimates, and concurred with the 
limitations of the GWP approach, finding directly modeled estimates to 
be more appropriate. While outside of the scope of the review, the 
reviewers briefly considered the limitations in the SC-CO2 
methodology (e.g., those discussed earlier in this section) and noted 
that because the SC-CO2 and SC-CH4 and SC-
N2O methodologies are similar, the limitations also apply to 
the resulting SC-CH4 and SC-N2O estimates. Two of 
the reviewers concluded that use of the SC-CH4 and SC-
N2O estimates developed by Marten et al. and published in 
the peer-reviewed literature is appropriate in RIAs, provided that the 
Agency discuss the limitations, similar to the discussion provided for 
SC-CO2 and other economic analyses. All three reviewers 
encouraged continued improvements in the SC-CO2 estimates 
and suggested that as those improvements are realized they should also 
be reflected in the SC-CH4 and SC-N2O estimates, 
with one reviewer suggesting the SC-CH4 and SC-
N2O estimates lag this process. The EPA supports continued 
improvement in the SC-CO2 estimates developed by the U.S. 
government and agrees that improvements in the SC-CO2 
estimates should also be reflected in the SC-CH4 and SC-
N2O estimates. The fact that the reviewers agree that the 
SC-CH4 and SC-N2O estimates are generally 
consistent with the SC-CO2 estimates that are recommended by 
OMB's guidance on valuing CO2 emissions reductions, leads 
the EPA to conclude that use of the SC-CH4 and SC-
N2O estimates is an analytical improvement over excluding 
CH4 and N2O emissions from the monetized portion 
of the benefit cost analysis.
    The EPA also carefully considered the full range of public comments 
and associated technical issues on the Marten et al. estimates received 
in this rulemaking and determined that it would continue to use the 
estimates in the final rulemaking analysis. Based on the evaluation of 
the public comments on this rulemaking, the favorable peer review of 
the application of Marten et al. estimates, and past comments urging 
EPA to value non-CO2 GHG impacts in its rulemakings, EPA 
concluded that the estimates represent the best scientific information 
on the impacts of climate change available in a form appropriate for 
incorporating the damages from incremental CH4 and 
N2O emissions changes into regulatory analysis and has 
included those benefits in the main benefits analysis. Please see RTC 
Section 11.8 for detailed responses to the comments on non-
CO2 GHG valuation.
    The application of directly modeled estimates from Marten et al. 
(2014) to benefit-cost analysis of a regulatory action is analogous to 
the use of the SC-CO2 estimates. Specifically, the SC-
CH4 and SC-N2O estimates in Table IX-15 are used 
to monetize the benefits of changes in CH4 and 
N2O emissions expected as a result of the final rulemaking. 
Forecast changes in CH4 and N2O emissions in a 
given year resulting from the regulatory action are multiplied by the 
SC-CH4 and SC-N2O estimate for that year, 
respectively. To obtain a present value estimate, the monetized stream 
of future non-CO2 benefits are discounted back to the 
analysis year using the same discount rate used to estimate the social 
cost of the non-CO2 GHG emission changes.
    The CH4 and N2O benefits based on Marten et 
al. (2014) are presented for each calendar year in Table IX-15.

[[Page 73880]]



   Table IX-15--Annual Upstream and Downstream non-CO[ihel2] GHG Benefits for the Given SC-non-CO[ihel2] Value Using Method B and Relative to the Flat
                                                  Baseline, using the Directly Modeled Approach \a\ \b\
                                                                 [Millions of 2012$] \c\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          CH4                                              N[ihel2]O
                                                 -------------------------------------------------------------------------------------------------------
                  Calendar year                                                 2.5%       3% 95th                                  2.5%       3% 95th
                                                   5% Average   3% Average    Average     percentile   5% Average   3% Average    Average     percentile
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018............................................           $0           $1           $1           $2           $0           $0           $0           $0
2019............................................            1            1            2            3            0            0            0            0
2020............................................            1            2            3            5            0            0            0            0
2021............................................            4            8           11           22            0            0            1            1
2022............................................            7           16           21           43            0            1            1            2
2023............................................           12           26           33           68            0            1            2            3
2024............................................           19           40           52          110            1            2            3            5
2025............................................           26           56           72          150            1            3            4            7
2026............................................           34           72           92          190            1            3            5            9
2027............................................           44           94          120          250            1            4            6           11
2028............................................           54          120          150          300            2            5            7           13
2029............................................           65          140          170          360            2            6            9           16
2030............................................           76          160          200          420            2            7           10           19
2035............................................          130          260          340          720            4           12           16           31
2040............................................          180          360          460          980            6           16           22           41
2050............................................          280          530          660        1,400            9           22           30           58
NPV.............................................        1,200        3,800        5,400       10,000           37          160          250          430
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ The SC-CH4 and SC-N[ihel2]O values are dollar-year and emissions-year specific.
\b\ Note that net present discounted values of reduced GHG emissions is are calculated differently than other benefits. The same discount rate used to
  discount the value of damages from future emissions (SC-CH4 and SC-N[ihel2]O at 5, 3, and 2.5 percent) is used to calculate net present value
  discounted values of SC-CH4 and SC-N[ihel2]O for internal consistency. Refer to the 2010 SC-CO[ihel2] TSD for more detail.
\c\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.

    (b) Sensitivity Analysis--HFC-134a Benefits Based on the GWP 
Approximation Approach
    While the rulemaking will result in reductions of HFC-134a, EPA is 
unaware of analogous estimates of the social cost of HFC-134a and has 
therefore used an alternative valuation approach and presented the 
results in this sensitivity analysis, separate from the main benefit 
cost analysis. Specifically, EPA has used the global warming potential 
(GWP) for HFC-134a to convert the emissions of this gas to 
CO2 equivalents, which are then valued using the SC-
CO2 estimates. This approach, henceforth referred to as the 
``GWP approach,'' has been used in sensitivity analyses to estimate the 
non-CO2 benefits in previous EPA rulemakings (see U.S. EPA 
2012, 2013).\841\ EPA has not presented these estimates in a main 
benefit-cost analysis due to the limitations associated with using the 
GWP approach to value changes in non-CO2 GHG emissions, and 
considered the GWP approach as an interim method of analysis until 
social cost estimates for non-CO2 GHGs, consistent with the 
SC-CO2 estimates, were developed.
---------------------------------------------------------------------------

    \841\ U.S. EPA. (2012). ``Regulatory impact analysis supporting 
the 2012 U.S. Environmental Protection Agency final new source 
performance standards and amendments to the national emission 
standards for hazardous air pollutants for the oil and natural gas 
industry.'' Retrieved from http://www3.epa.gov/ttn/ecas/regdata/RIAs/oil_natural_gas_final_neshap_nsps_ria.pdf. U.S. EPA. (2013). 
``Regulatory impact analysis: Final rulemaking for 2017-2025 light-
duty vehicle greenhouse gas emission standards and corporate average 
fuel economy standards.'' Retrieved from http://www3.epa.gov/otaq/climate/documents/420r12016.pdf.
---------------------------------------------------------------------------

    The GWP is a simple, transparent, and well-established metric for 
assessing the relative impacts of non-CO2 emissions compared 
to CO2 on a purely physical basis. However, as discussed 
both in the 2010 SC-CO2 TSD and previous rulemakings (e.g., 
U.S. EPA 2012, 2013), the GWP approximation approach to measuring non-
CO2 GHG benefits has several well-documented limitations. 
These metrics are not ideally suited for use in benefit-cost analyses 
to approximate the social cost of non-CO2 GHGs because the 
approach would assume all subsequent linkages leading to damages are 
linear in radiative forcing, which would be inconsistent with the most 
recent scientific literature. Detailed discussion of limitations of the 
GWP approach can be found in the RIA.
    EPA applies the GWP approach to estimate the benefits associated 
with reductions of HFCs in each calendar year. Under the GWP Approach, 
EPA converted HFC-134a to CO2 equivalents using the AR4 100-
year GWP for HFC-134a (1,430).\842\ These CO2-equivalent 
emission reductions are multiplied by the SC-CO2 estimate 
corresponding to each year of emission reductions. As with the 
calculation of annual benefits of CO2 emission reductions, 
the annual benefits of non-CO2 emission reductions based on 
the GWP approach are discounted back to net present value terms using 
the same discount rate as each SC-CO2 estimate. The 
estimated HFC-134a benefits using the GWP approach are presented in 
Table IX-16.
---------------------------------------------------------------------------

    \842\ Source: Table 2.14 (Errata). Lifetimes, radiative 
efficiencies and direct (except for CH4) GWPs relative to 
CO2. IPCC Fourth Assessment Report ``Climate Change 2007: 
Working Group I: The Physical Science Basis.''

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[[Page 73881]]


Vol. 81

Tuesday,

No. 206

October 25, 2016

Part II--Continued

Book 2 of 2 Books

Pages 73881-74278



Environmental Protection Agency




[[Page 73882]]



  Table IX-16--Annual Upstream and Downstream HFC-134a Benefits for the Given SC-CO[ihel2] Value Using Method B
                        and Relative to the Flat Baseline, using the GWP Approach \a\ \b\
                                             [Millions of 2013$] \b\
----------------------------------------------------------------------------------------------------------------
                                                                             HFC-134a
                                                 ---------------------------------------------------------------
                  Calendar year                                                                      3%, 95th
                                                    5% Average      3% Average     2.5% Average     Percentile
----------------------------------------------------------------------------------------------------------------
2018............................................              $0              $0              $0              $0
2019............................................              $0              $0              $0              $0
2020............................................              $0              $0              $0              $0
2021............................................              $0              $1              $1              $3
2022............................................              $1              $2              $3              $5
2023............................................              $1              $3              $4              $8
2024............................................              $1              $4              $5             $11
2025............................................              $1              $5              $7             $14
2026............................................              $2              $6              $9             $18
2027............................................              $2              $7             $10             $21
2028............................................              $3              $8             $12             $25
2029............................................              $3             $10             $14             $29
2030............................................              $4             $11             $16             $33
2035............................................              $5             $15             $22             $47
2040............................................              $6             $18             $25             $54
2050............................................              $9             $23             $31             $70
NPV.............................................             $44            $200            $320            $620
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ The SC-CO[ihel2] values are dollar-year and emissions-year specific.
\b\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

(c) Additional Non-CO2 GHGs Co-Benefits
    In determining the relative social costs of the different gases, 
the Marten et al. (2014) analysis accounts for differences in lifetime 
and radiative efficiency between the non-CO2 GHGs and 
CO2. The analysis also accounts for radiative forcing 
resulting from methane's effects on tropospheric ozone and 
stratospheric water vapor, and for at least some of the fertilization 
effects of elevated carbon dioxide concentrations. However, there exist 
several other differences between these gases that have not yet been 
captured in this analysis, for example the non-radiative effects of 
methane-driven elevated tropospheric ozone levels on human health, 
agriculture, and ecosystems, and the effects of carbon dioxide on ocean 
acidification. Inclusion of these additional non-radiative effects 
would potentially change both the absolute and relative value of the 
various gases.
    Of these effects, the human health effect of elevated tropospheric 
ozone levels resulting from methane emissions is the closest to being 
monetized in a way that would be comparable to the SCC. Premature 
ozone-related cardiopulmonary deaths resulting from global increases in 
tropospheric ozone concentrations produced by the methane oxidation 
process have been the focus of a number of studies over the past decade 
(e.g., West et al. 2006; \843\ Anenberg et al. 2012; \844\ Shindell et 
al. 2012 \845\). Recently, a paper was published in the peer-reviewed 
scientific literature that presented a range of estimates of the 
monetized ozone-related mortality benefits of reducing methane 
emissions (Sarofim et al. 2015). For example, under their base case 
assumptions using a 3 percent discount rate, Sarofim et al. find global 
ozone-related mortality benefits of methane emissions reductions to be 
$790 per ton of methane in 2020, with 10.6 percent, or $80, of this 
amount resulting from mortality reductions in the United States. The 
methodology used in this study is consistent in some (but not all) 
aspects with the modeling underlying the SC-CO2 and SC-
CH4 estimates discussed above, and required a number of 
additional assumptions such as baseline mortality rates and mortality 
response to ozone concentrations. While the EPA does consider the 
methane impacts on ozone to be important, there remain unresolved 
questions regarding several methodological choices involved in applying 
the Sarofim et al. (2015) approach in the context of an EPA benefits 
analysis, and therefore the EPA is not including a quantitative 
analysis of this effect in this rule at this time.
---------------------------------------------------------------------------

    \843\ West JJ, Fiore AM, Horowitz LW, Mauzerall DL (2006) Global 
health benefits of mitigating ozone pollution with methane emission 
controls. Proc Natl Acad Sci USA 103 (11):3988-3993. doi:10.1073/
pnas.0600201103
    \844\ Anenberg SC, Schwartz J, Shindell D, Amann M, Faluvegi G, 
Klimont Z, . . . , Vignati E (2012) Global air quality and health 
co-benefits of mitigating near-term climate change through methane 
and black carbon emission controls. Environ Health Perspect 120 
(6):831. doi:10.1289/ehp.1104301.
    \845\ Shindell D, Kuylenstierna JCI, Vignati E, van Dingenen R, 
Amann M, Klimont Z, . . ., Fowler D (2012) Simultaneously Mitigating 
Near-Term Climate Change and Improving Human Health and Food 
Security. Science 335 (6065):183-189. doi:10.1126/science.1210026.
---------------------------------------------------------------------------

H. Monetized Non-GHG Health Impacts

    This section discusses the economic benefits from reductions in 
health and environmental impacts resulting from non-GHG emission 
reductions that can be expected to occur as a result of the Phase 2 
standards. CO2 emissions are predominantly the byproduct of 
fossil fuel combustion processes that also produce criteria and 
hazardous air pollutant emissions. The vehicles that are subject to the 
Phase 2 standards are also significant sources of mobile source air 
pollution such as direct PM, NOX, VOCs and air toxics. The 
standards will affect exhaust emissions of these pollutants from 
vehicles and will also affect emissions from upstream sources that 
occur during the refining and distribution of fuel. Changes in ambient 
concentrations of ozone, PM2.5, and air toxics that will 
result from the Phase 2 standards are expected to affect human health 
by reducing premature deaths and other serious human health effects, as 
well as other important improvements in public health and

[[Page 73883]]

welfare. Children especially benefit from reduced exposures to criteria 
and toxic pollutants, because they tend to be more sensitive to the 
effects of these respiratory pollutants. Ozone and particulate matter 
have been associated with increased incidence of asthma and other 
respiratory effects in children, and particulate matter has been 
associated with a decrease in lung maturation. Some minority groups and 
children living under the poverty line are even more vulnerable with 
higher prevalence of asthma.
    It is important to quantify the health and environmental impacts 
associated with the standards because a failure to adequately consider 
ancillary impacts could lead to an incorrect assessment of their costs 
and benefits. Moreover, the health and other impacts of exposure to 
criteria air pollutants and airborne toxics tend to occur in the near 
term, while most effects from reduced climate change are likely to 
occur only over a time frame of several decades or longer.
    Impacts such as emissions reductions, costs and benefits are 
presented in this analysis from two perspectives:
     A ``model year lifetime analysis'' (MY), which shows 
impacts of the program that occur over the lifetime of the vehicles 
produced during the model years subject to the Phase 2 standards (MYs 
2018 through 2029).,
     A ``calendar year analysis'' (CY), which shows annual 
costs and benefits of the Phase 2 standards for each year from 2018 
through 2050. We assume the standard in the last model year subject to 
the standards applies to all subsequent MY fleets developed in the 
future.
    In previous light-duty and heavy-duty GHG rulemakings, EPA has 
quantified and monetized non-GHG health impacts using two different 
methods. For the MY analysis, EPA applies PM-related ``benefits per-
ton'' values to the stream of lifetime estimated emission reductions as 
a reduced-form approach to estimating the PM2.5-related 
benefits of the rule.846 847 For the CY analysis, EPA 
typically conducts full-scale photochemical air quality modeling to 
quantify and monetize the PM2.5- and ozone-related health 
impacts of a single representative future year. EPA then assumes these 
benefits are repeated in subsequent future years when criteria 
pollutant emission reductions are equal to or greater than those 
modeled in the representative future year.
---------------------------------------------------------------------------

    \846\ Fann, N., Baker, K.R., and Fulcher, C.M. (2012). 
Characterizing the PM 2.5-related health benefits of 
emission reductions for 17 industrial, area and mobile emission 
sectors across the U.S., Environment International, 49, 241-151, 
published online September 28, 2012.
    \847\ See also: http://www3.epa.gov/airquality/benmap/sabpt.html. The current values available on the Web page have been 
updated since the publication of the Fann et al., 2012 paper. For 
more information regarding the updated values, see: http://www3.epa.gov/airquality/benmap/models/Source_Apportionment_BPT_TSD_1_31_13.pdf (accessed September 9, 
2014).
---------------------------------------------------------------------------

    This two-pronged approach to estimating non-GHG impacts is 
precipitated by the length of time needed to prepare the necessary 
emissions inventories and the processing time associated with full-
scale photochemical air quality modeling for a single representative 
future year. The timing requirements (along with other resource 
limitations) preclude EPA from being able to do the more detailed 
photochemical modeling for every year that we include in our benefit 
and cost estimates, and require EPA to make air quality modeling input 
decisions early in the analytical process. As a result, it was 
necessary to use emissions from the proposed program to conduct the air 
quality modeling.
    The chief limitation when using air quality inventories based on 
emissions from the proposal in the CY modeling analysis is that they 
can diverge from the estimated emissions of the final rulemaking. How 
much the emissions might diverge and how that difference would impact 
the air quality modeling and health benefit results is difficult to 
anticipate. For the FRM, EPA concluded that when comparing the proposal 
and final rule inventories, the differences were enough to justify the 
move of the typical CY benefits analysis (based on air quality 
modeling) from the primary estimate of costs and benefits to a 
supplemental analysis in an appendix to the RIA (See RIA Appendix 
8.A).\848\ While we believe this supplemental analysis is still 
illustrative of the standard's potential benefits, EPA has instead 
chosen to characterize the CY benefits in a manner consistent with the 
MY lifetime analysis. That is, we apply the PM-related ``benefits per-
ton'' values to the CY final rule emission reductions to estimate the 
PM-related benefits of the final rule.
---------------------------------------------------------------------------

    \848\ Chapter 5 of the RIA has more detail on the differences 
between the air quality and final inventories.
---------------------------------------------------------------------------

    This section presents the benefits-per-ton values used to monetize 
the benefits from reducing population exposure to PM associated with 
the standards. EPA bases its analyses on peer-reviewed studies of air 
quality and health and welfare effects and peer-reviewed studies of the 
monetary values of public health and welfare improvements, and is 
generally consistent with benefits analyses performed for the analysis 
of the final Tier 3 Vehicle Rule,\849\ the final 2012 p.m. NAAQS 
Revision,\850\ and the final 2017-2025 Light Duty Vehicle GHG 
Rule.\851\
---------------------------------------------------------------------------

    \849\ U.S. Environmental Protection Agency. (2014). Control of 
Air Pollution from Motor Vehicles: Tier 3 Motor Vehicle Emission and 
Fuel Standards Final Rule: Regulatory Impact Analysis, Assessment 
and Standards Division, Office of Transportation and Air Quality, 
EPA-420-R-14-005, March 2014. Available on the internet: http://www3.epa.gov/otaq/documents/tier3/420r14005.pdf.
    \850\ U.S. Environmental Protection Agency. (2012). Regulatory 
Impact Analysis for the Final Revisions to the National Ambient Air 
Quality Standards for Particulate Matter, Health and Environmental 
Impacts Division, Office of Air Quality Planning and Standards, EPA-
452-R-12-005, December 2012. Available on the internet: http://www3.epa.gov/ttnecas1/regdata/RIAs/finalria.pdf.
    \851\ U.S. Environmental Protection Agency (U.S. EPA). (2012). 
Regulatory Impact Analysis: Final Rulemaking for 2017-2025 Light-
Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average 
Fuel Economy Standards, Assessment and Standards Division, Office of 
Transportation and Air Quality, EPA-420-R-12-016, August 2012. 
Available on the Internet at: http://www3.epa.gov/otaq/climate/documents/420r12016.pdf.
---------------------------------------------------------------------------

    EPA is also requiring that rebuilt engines installed in new 
incomplete vehicles (i.e., ``glider kit'' vehicles) meet the emission 
standards applicable in the year of assembly of the new vehicle, 
including all applicable standards for criteria pollutants (Section 
XIII.B). For the final rule, EPA has updated its analysis of the 
environmental impacts of these glider kit vehicles (see Section 
XIII.B.1). These standards will decrease PM and NOX 
emissions dramatically, leading to substantial public health-related 
benefits. Although we only present these benefits as a sensitivity 
analysis in Section XIII.B, it is clear that removing even a fraction 
of glider kit vehicles from the road will yield substantial health-
related benefits that are not captured by the primary estimate of 
monetized non-GHG health impacts described in this section.
(1) Economic Value of Reductions in Particulate Matter
    As described in Section VIII, the standards will reduce emissions 
of several criteria and toxic pollutants and their precursors. In this 
analysis, EPA only estimates the economic value of the human health 
benefits associated with the resulting reductions in PM2.5 
exposure. Due to analytical limitations with the benefit per ton 
method, this analysis does not estimate benefits resulting from 
reductions in population exposure to other criteria pollutants such as 
ozone.\852\ Furthermore, the

[[Page 73884]]

benefits per-ton method, like all air quality impact analyses, does not 
monetize all of the potential health and welfare effects associated 
with reduced concentrations of PM2.5.
---------------------------------------------------------------------------

    \852\ The air quality modeling that underlies the PM-related 
benefit per ton values also produced estimates of ozone levels 
attributable to each sector. However, the complex non-linear 
chemistry governing ozone formation prevented EPA from developing a 
complementary array of ozone benefit per ton values. This limitation 
notwithstanding, we anticipate that the ozone-related benefits 
associated with reducing emissions of NOX and VOC are 
substantial. Refer to RIA Appendix 8.A for the ozone benefits 
results from the supplemental CY benefits analysis.
---------------------------------------------------------------------------

    This analysis uses estimates of the benefits from reducing the 
incidence of the specific PM2.5-related health impacts 
described below. These estimates, which are expressed per ton of 
PM2.5-related emissions eliminated by the final program, 
represent the monetized value of human health benefits (including 
reductions in both premature mortality and premature morbidity) from 
reducing each ton of directly emitted PM2.5 or its 
precursors (SO2 and NOX), from a specified 
source. Ideally, the human health benefits would be estimated based on 
changes in ambient PM2.5 as determined by full-scale air 
quality modeling. However, the length of time needed to prepare the 
necessary emissions inventories, in addition to the processing time 
associated with the modeling itself, has precluded us from performing 
air quality modeling that reflects the emissions and air quality 
impacts associated with the final program.
    EPA received comment regarding the omission of ozone-related 
benefits from the non-GHG benefits analysis included in the proposal. 
EPA agrees that total benefits are underestimated when ozone-related 
benefits are not included in the primary analysis. However, for reasons 
described in the introduction to this section, PM- and ozone-related 
health benefits based on air quality modeling for the CY analysis are 
not included in the primary estimate of costs and benefits. Instead, 
they can be found as a supplemental analysis to the RIA in Appendix 8A.
    The PM-related dollar-per-ton benefit estimates used in this 
analysis are provided in Table IX-17. As the table indicates, these 
values differ among pollutants, and also depend on their original 
source, because emissions from different sources can result in 
different degrees of population exposure and resulting health impacts. 
In the summary of costs and benefits, Section IX.K of this Preamble, 
EPA presents the monetized value of PM-related improvements associated 
with the final program.

                                                     Table IX-17--PM-Related Benefits-per-Ton Values
                                                                  [Thousands, 2013$] a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      On-road mobile sources                           Upstream sources \d\
                        Year \c\                         -----------------------------------------------------------------------------------------------
                                                           Direct PM2.5      SO[ihel2]          NOX        Direct PM2.5      SO[ihel2]          NOX
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Estimated Using a 3 Percent Discount Rate \b\
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016....................................................       $380-$870         $20-$46        $7.8-$18       $330-$760        $71-$160        $6.9-$16
2020....................................................         410-920           22-50          8.2-18         350-800          76-170          7.5-17
2025....................................................       450-1,000           25-56          9.0-20         400-890          84-190          8.2-18
2030....................................................       490-1,100           28-62          9.7-22         430-960          92-200          8.9-20
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Estimated Using a 7 Percent Discount Rate \b\
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016....................................................       $340-$780         $18-$42        $7.1-$16       $300-$680        $64-$140        $6.3-$14
2020....................................................         370-830           20-45          7.5-17         320-730          68-150          6.7-15
2025....................................................         410-920           22-50          8.1-18         350-800          76-170          7.4-17
2030....................................................         440-990           25-56          8.8-20         380-870          82-180          8.0-18
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ The benefit-per-ton estimates presented in this table are based on a range of premature mortality estimates derived from the ACS study (Krewski et
  al., 2009) and the Six-Cities study (Lepeule et al., 2012). See Chapter VIII of the RIA for a description of these studies.
\b\ The benefit-per-ton estimates presented in this table assume either a 3 percent or 7 percent discount rate in the valuation of premature mortality
  to account for a twenty-year segmented premature mortality cessation lag.
\c\ Benefit-per-ton values were estimated for the years 2016, 2020, 2025 and 2030. We hold values constant for intervening years (e.g., the 2016 values
  are assumed to apply to years 2017-2019; 2020 values for years 2021-2024; 2030 values for years 2031 and beyond).
\d\ We assume for the purpose of this analysis that total ``upstream emissions'' are most appropriately monetized using the refinery sector benefit per-
  ton values. The majority of upstream emission reductions associated with the final rule are related to domestic onsite refinery emissions and domestic
  crude production. While total upstream emissions also include storage and transport sources, as well as sources upstream from the refinery, we have
  chosen to simply apply the refinery values.

    The benefit-per-ton technique has been used in previous analyses, 
including EPA's 2017-2025 Light-Duty Vehicle Greenhouse Gas Rule,\853\ 
the Reciprocating Internal Combustion Engine rules,854 855 
and the Residential Wood Heaters NSPS.\856\ Table IX-18 shows the 
quantified PM2.5-related co-benefits captured in those 
benefit per-ton estimates, as well as unquantified effects the benefit 
per-ton estimates are unable to capture.
---------------------------------------------------------------------------

    \853\ U.S. Environmental Protection Agency (U.S. EPA). (2012). 
Regulatory Impact Analysis: Final Rulemaking for 2017-2025 Light-
Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average 
Fuel Economy Standards, Assessment and Standards Division, Office of 
Transportation and Air Quality, EPA-420-R-12-016, August 2012. 
Available on the Internet at: http://www3.epa.gov/otaq/climate/documents/420r12016.pdf.
    \854\ U.S. Environmental Protection Agency (U.S. EPA). (2013). 
Regulatory Impact Analysis for the Reconsideration of the Existing 
Stationary Compression Ignition (CI) Engines NESHAP, Office of Air 
Quality Planning and Standards, Research Triangle Park, NC. January. 
EPA-452/R-13-001. Available at http://www3.epa.gov/ttnecas1/regdata/RIAs/RICE_NESHAPreconsideration_Compression_Ignition_Engines_RIA_final2013_EPA.pdf.
    \855\ U.S. Environmental Protection Agency (U.S. EPA). (2013). 
Regulatory Impact Analysis for Reconsideration of Existing 
Stationary Spark Ignition (SI) RICE NESHAP, Office of Air Quality 
Planning and Standards, Research Triangle Park, NC. January. EPA-
452/R-13-002. Available at http://www3.epa.gov/ttnecas1/regdata/RIAs/NESHAP_RICE_Spark_Ignition_RIA_finalreconsideration2013_EPA.pdf.

    \856\ U.S. Environmental Protection Agency (U.S. EPA). (2015). 
Regulatory Impact Analysis for Residential Wood Heaters NSPS 
Revision. Office of Air Quality Planning and Standards, Research 
Triangle Park, NC. February. EPA-452/R-15-001. Available at http://www2.epa.gov/sites/production/files/2015-02/documents/20150204-residential-wood-heaters-ria.pdf.

[[Page 73885]]



                             Table IX-18--Human Health and Welfare Effects of PM2.5
----------------------------------------------------------------------------------------------------------------
                                Quantified and monetized in primary
     Pollutant/ effect                       estimates                      Unquantified effects changes in:
----------------------------------------------------------------------------------------------------------------
PM2.5......................  Adult premature mortality................  Chronic and subchronic bronchitis cases.
                             Acute bronchitis.........................  Strokes and cerebrovascular disease.
                             Hospital Admissions: Respiratory and       Low birth weight.
                              cardiovascular.
                             Emergency room visits for asthma.........  Pulmonary function.
                             Nonfatal heart attacks (myocardial         Chronic respiratory diseases other than
                              infarction).                               chronic bronchitis.
                             Lower and upper respiratory illness......  Non-asthma respiratory emergency room
                                                                         visits.
                             Minor restricted-activity days...........  Visibility.
                             Work loss days...........................  Household soiling.
                             Asthma exacerbations (asthmatic
                              population).
                             Infant mortality.........................
----------------------------------------------------------------------------------------------------------------

    A more detailed description of the benefit-per-ton estimates is 
provided in Chapter 8 of the RIA that accompanies this rulemaking. 
Readers interested in reviewing the complete methodology for creating 
the benefit-per-ton estimates used in this analysis can consult EPA's 
``Technical Support Document: Estimating the Benefit per Ton of 
Reducing PM2.5 Precursors from 17 Sectors.'' \857\ Readers 
can also refer to Fann et al. (2012) \858\ for a detailed description 
of the benefit-per-ton methodology.
---------------------------------------------------------------------------

    \857\ For more information regarding the updated values, see: 
http://www3.epa.gov/airquality/benmap/models/Source_Apportionment_BPT_TSD_1_31_13.pdf (accessed September 9, 
2014).
    \858\ Fann, N., Baker, K.R., and Fulcher, C.M. (2012). 
Characterizing the PM2.5-related health benefits of emission 
reductions for 17 industrial, area and mobile emission sectors 
across the U.S., Environment International, 49, 241-151, published 
online September 28, 2012.
---------------------------------------------------------------------------

    As Table IX-17 indicates, EPA projects that the per-ton values for 
reducing emissions of non-GHG pollutants from both vehicle use and 
upstream sources such as fuel refineries will increase over time.\859\ 
These projected increases reflect rising income levels, which increase 
affected individuals' willingness to pay for reduced exposure to health 
threats from air pollution.\860\ They also reflect future population 
growth and increased life expectancy, which expands the size of the 
population exposed to air pollution in both urban and rural areas, 
especially among older age groups with the highest mortality risk.\861\
---------------------------------------------------------------------------

    \859\ As we discuss in the emissions chapter of the RIA (Chapter 
V), the rule will yield emission reductions from upstream refining 
and fuel distribution due to decreased petroleum consumption.
    \860\ The issue is discussed in more detail in the 2012 p.m. 
NAAQS RIA. See U.S. Environmental Protection Agency. (2012). 
Regulatory Impact Analysis for the Final Revisions to the National 
Ambient Air Quality Standards for Particulate Matter, Health and 
Environmental Impacts Division, Office of Air Quality Planning and 
Standards, EPA-452-R-12-005, December 2012. Available on the 
internet: http://www3.epa.gov/ttnecas1/regdata/RIAs/finalria.pdf.
    \861\ For more information about EPA's population projections, 
please refer to the following: http://www3.epa.gov/air/benmap/models/BenMAPManualAppendicesAugust2010.pdf (See Appendix K).
---------------------------------------------------------------------------

(2) Unquantified Health and Environmental Impacts
    One commenter supported the inclusion of all quantifiable impacts 
of reductions in non-GHG pollutants. Specifically, they suggested the 
inclusion of ecosystem benefits from reduced non-GHG pollutants 
including those to crops as well as consideration of the impacts on 
toxic air contaminants such as diesel PM.
    In addition to the PM-related co-pollutant health impacts EPA 
quantifies in this analysis, EPA acknowledges that there are a number 
of other health and human welfare endpoints that we are not able to 
quantify or monetize because of current limitations in the methods or 
available data. These impacts are associated with emissions of air 
toxics (including benzene, 1,3-butadiene, formaldehyde, acetaldehyde, 
acrolein, naphthalene and ethanol), ambient ozone, and ambient 
PM2.5 exposures. Chapter 8 of the RIA lists these 
unquantified health and environmental impacts. While there will be 
impacts associated with air toxic pollutant emission changes that 
result from the final standard, EPA will not attempt to monetize those 
impacts. This is primarily because currently available tools and 
methods to assess air toxics risk from mobile sources at the national 
scale are not adequate for extrapolation to incidence estimations or 
benefits assessment. The best suite of tools and methods currently 
available for assessment at the national scale are those used in the 
National-Scale Air Toxics Assessment (NATA). EPA's Science Advisory 
Board specifically commented in their review of the 1996 NATA that 
these tools were not yet ready for use in a national-scale benefits 
analysis, because they did not consider the full distribution of 
exposure and risk, or address sub-chronic health effects.\862\ While 
EPA has since improved the tools, there remain critical limitations for 
estimating incidence and assessing benefits of reducing mobile source 
air toxics.\863\ EPA continues to work to address these limitations; 
however, EPA does not have the methods and tools available for 
national-scale application in time for the analysis of the final 
rules.\864\
---------------------------------------------------------------------------

    \862\ Science Advisory Board. 2001. NATA--Evaluating the 
National-Scale Air Toxics Assessment for 1996--an SAB Advisory. 
http://www3.epa.gov/ttn/atw/sab/sabrev.html.
    \863\ Examples include gaps in toxicological data, uncertainties 
in extrapolating results from high-dose animal experiments to 
estimate human effects at lower does, limited ambient and personal 
exposure monitoring data, and insufficient economic research to 
support valuation of the health impacts often associated with 
exposure to individual air toxics. See Gwinn et al., 2011. Meeting 
Report: Estimating the Benefits of Reducing Hazardous Air 
Pollutants--Summary of 2009 Workshop and Future Considerations. 
Environ Health Perspectives, Jan 2011; 119(1): 125-130.
    \864\ In April, 2009, EPA hosted a workshop on estimating the 
benefits of reducing hazardous air pollutants. This workshop built 
upon the work accomplished in the June 2000 in an earlier (2000) 
Science Advisory Board/EPA Workshop on the Benefits of Reductions in 
Exposure to Hazardous Air Pollutants, which generated thoughtful 
discussion on approaches to estimating human health benefits from 
reductions in air toxics exposure, but no consensus was reached on 
methods that could be implemented in the near term for a broad 
selection of air toxics. Please visit http://epa.gov/air/toxicair/2009workshop.html for more information about the workshop and its 
associated materials.
---------------------------------------------------------------------------

I. Energy Security Impacts

    The Phase 2 standards are designed to require improvements in the 
fuel efficiency of medium- and heavy-duty vehicles and, thereby, reduce 
fuel consumption and GHG emissions. In turn, the Phase 2 standards help 
to reduce U.S. petroleum imports. A reduction of U.S. petroleum imports 
reduces both financial and strategic risks caused by potential sudden 
disruptions in the supply of imported petroleum to the U.S., thus 
increasing

[[Page 73886]]

U.S. energy security. This section summarizes the agency's estimates of 
U.S. oil import reductions and energy security benefits of the Phase 2 
final standards. Additional discussion of this issue can be found in 
Chapter 8.8 of the RIA.
(1) Implications of Reduced Petroleum Use on U.S. Imports
    U.S. energy security is generally considered as the continued 
availability of energy sources at an acceptable price. Most discussion 
of U.S. energy security revolves around the topic of the economic costs 
of U.S. dependence on oil imports. While the U.S. has reduced its 
consumption and increased its production of oil in recent years, it 
still relies on oil from potentially unstable sources. In addition, oil 
exporters with a large share of global production have the ability to 
raise the price of oil by exerting the monopoly power associated with a 
cartel, the Organization of Petroleum Exporting Countries (OPEC), to 
restrict oil supply relative to demand. These factors contribute to the 
vulnerability of the U.S. economy to episodic oil supply shocks and 
price spikes.
    In 2014, U.S. expenditures for imports of crude oil and petroleum 
products, net of revenues for exports, were $178 billion and 
expenditures on both imported oil and domestic petroleum and refined 
products totaled $469 billion (in 2013$) (see Figure IX-1).\865\ 
Recently, as a result of strong growth in domestic oil production 
mainly from tight shale formations, U.S. production of oil has 
increased while U.S. oil imports have decreased. For example, from 2012 
to 2015, domestic oil production increased by 44 percent while net oil 
imports and products decreased by 38 percent. While U.S. oil import 
costs have declined since 2011, total oil expenditures (domestic and 
imported) remained near historical highs through 2014. Post-2015 oil 
expenditures are projected (AEO 2015) to remain between double and 
triple the inflation-adjusted levels experienced by the U.S. from 1986 
to 2002.C
---------------------------------------------------------------------------

    \865\ See EIA Annual Energy Review, various editions. For data 
2011-2013, and projected data: EIA Annual Energy Outlook (AEO) 2014 
(Reference Case). See Table 11, file ``aeotab_11.xls.''
---------------------------------------------------------------------------

    Focusing on changes in oil import levels as a source of 
vulnerability has been standard practice in assessing energy security 
in the past, but given current market trends both from domestic and 
international levels, adding changes in consumption of petroleum to 
this assessment may provide better information about U.S. energy 
security. The major mechanism through which the economy sustains harm 
due to fluctuations in the (world) energy market is through price, 
which itself is leveraged through both imports and consumption. 
However, the United States, may be increasingly insulated from the 
physical effects of overseas oil disruptions, though the price impacts 
of an oil disruption anywhere will continue to be transmitted to U.S. 
markets. As of 2015, Canada accounted for 63 percent of U.S. net oil 
imports of crude oil and petroleum products. The implications of the 
U.S. becoming a significant petroleum producer have yet to be discerned 
in the literature, but it can be anticipated that this will have some 
impact on energy security.
    In 2010, just over 40 percent of world oil supply came from OPEC 
nations. The AEO 2015 projects that this share will stay high; dipping 
slightly from 37 percent by 2020 and then rising gradually to over 40 
percent by 2035 and thereafter. Approximately 30 percent of global 
supply is from Middle East and North African countries alone, a share 
that is also expected to grow. Measured in terms of the share of world 
oil resources or the share of global oil export supply, rather than oil 
production, the concentration of global petroleum resources in OPEC 
nations is even larger. As another measure of concentration, of the 137 
countries/principalities that export either crude or refined products, 
the top 12 have recently accounted for over 55 percent of exports.\866\ 
Eight of these countries are members of OPEC, and a ninth is 
Russia.\867\ In a market where even a 1-2 percent supply loss can raise 
prices noticeably, and where a 10 percent supply loss could lead to an 
unprecedented price shock, this regional concentration is of 
concern.\868\ Historically, the countries of the Middle East have been 
the source of eight of the ten major world oil disruptions,\869\ with 
the ninth originating in Venezuela, an OPEC country, and the tenth 
being Hurricanes Katrina and Rita.
---------------------------------------------------------------------------

    \866\ Based on data from the CIA, combining various recent 
years, https://www.cia.gov/library/publications/the-world-factbook/rankorder/2242rank.html.
    \867\ The other three are Norway, Canada, and the EU, an 
exporter of product.
    \868\ For example, the 2005 Hurricanes Katrina/Rita and the 2011 
Libyan conflict both led to a 1.8 percent reduction in global crude 
supply. While the price impact of the latter is not easily 
distinguished given the rapidly rising post-recession prices, the 
former event was associated with a 10-15 percent world oil price 
increase. There are a range of smaller events with smaller but 
noticeable impacts. Somewhat larger events, such as the 2002/3 
Venezuelan Strike and the War in Iraq, corresponded to about a 2.9 
percent sustained loss of supply, and were associated with a 28 
percent world oil price increase.
    Compiled from EIA oil price data, IEA2012 [IEA Response System 
for Oil Supply Emergencies (http://www.iea.org/publications/freepublications/publication/EPPD_Brochure_English_2012_02.pdf)
    See table on P. 11.and Hamilton 2011 ``Historical Oil 
Shocks,''(http://econweb.ucsd.edu/~jhamilto/oil_history.pdf) in 
*Routledge Handbook of Major Events in Economic History*, pp. 239-
265, edited by Randall E. Parker and Robert Whaples, New York: 
Routledge Taylor and Francis Group, 2013). Available in bookstores.
    \869\ IEA 2011 ``IEA Response System for Oil Supply 
Emergencies.''
    \870\ For historical data: EIA Annual Energy Review, various 
editions. For data 2011-2013, and projected data: EIA Annual Energy 
Outlook (AEO) 2014 (Reference Case). See Table 11, file 
``aeotab_11.xls.''

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[[Page 73887]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.037

    The agencies used EPA's MOVES model to estimate the reductions in 
U.S. fuel consumption due to these final rules for vocational vehicles 
and tractors. For HD pickups and vans, the agencies used both DOT's 
CAFE model and EPA's MOVES model to estimate the fuel consumption 
impacts. (Detailed explanations of the MOVES and CAFE models can be 
found in Chapter 5 of the RIA. See IX.C of the Preamble for estimates 
of reduced fuel consumption from these final rules). Based on a 
detailed analysis of differences in U.S. fuel consumption, petroleum 
imports, and imports of petroleum products, the agencies estimate that 
approximately 90 percent of the reduction in fuel consumption resulting 
from adopting improved GHG emission and fuel efficiency standards is 
likely to be reflected in reduced U.S. imports of crude oil and net 
imported petroleum products.\871\ Thus, on balance, each gallon of fuel 
saved as a consequence of the HD GHG and fuel efficiency standards is 
anticipated to reduce total U.S. imports of petroleum by 0.90 gallons. 
Based upon the fuel savings estimated by the MOVES/CAFE models and the 
90 percent oil import factor, the reduction in U.S. oil imports and 
exports from these final rules are estimated for the years 2020, 2025, 
2030, 2040, and 2050 (in millions of barrels per day (MMBD)) in Table 
IX-19 below. For comparison purposes, Table IX-19 also shows U.S. 
imports of crude oil in 2020, 2025, 2030 and 2040 as projected by DOE 
in the Annual Energy Outlook 2015 Reference Case. U.S. Gross Domestic 
Product (GDP) is projected to grow by roughly 48 percent over the same 
time frame (e.g., from 2020 to 2040) in the AEO 2015 projections.
---------------------------------------------------------------------------

    \871\ We looked at changes in U.S. crude oil imports and net 
petroleum products in the AEO 2015 Reference Case in comparison the 
Low (i.e., Economic Growth) Demand Case to undertake this analysis. 
See the spreadsheet ``Impact of Fuel Demand on Imports 
AEO2015.xlsx.'' We also considered a paper entitled ``Effect of a 
U.S. Demand Reduction on Imports and Domestic Supply Levels'' by 
Leiby, P., 4/16/2013. This paper suggests that ``Given a particular 
reduction in oil demand stemming from a policy or significant 
technology change, the fraction of oil use savings that shows up as 
reduced U.S. imports, rather than reduced U.S. supply, is actually 
quite close to 90 percent, and probably close to 95 percent.''

 Table IX-19--Projected U.S. Imports and Exports of Oil and U.S. Oil Import Reductions Resulting From the Final
        Phase 2 Program in 2020, 2025, 2030, 2040 and 2050 Using Method B and Relative to a Flat Baseline
                                    [Millions of barrels per day (MMBD)] \a\
----------------------------------------------------------------------------------------------------------------
                                                                                                     U.S. oil
                                                                     U.S. net        U.S. net         import
              Year                   U.S. oil        U.S. oil         product         crude &       reductions
                                      exports         imports        imports *        product     from final  HD
                                                                                      imports          Rules
----------------------------------------------------------------------------------------------------------------
2020............................            0.63            6.14           -2.80            2.71           0.007
2025............................            0.63            6.72           -3.24            2.85           0.162
2030............................            0.63            7.07           -3.56            2.88           0.405
2040............................            0.63            8.21           -4.26            3.32           0.721

[[Page 73888]]

 
2050............................            (**)            (**)            (**)            (**)           0.861
----------------------------------------------------------------------------------------------------------------
Notes:
* Negative U.S. Net Product Imports imply positive exports.
** The AEO 2015 only projects energy market and economic trends through 2040.

(2) Energy Security Implications
    In order to understand the energy security implications of reducing 
U.S. oil imports, EPA has worked with Oak Ridge National Laboratory 
(ORNL), which has developed approaches for evaluating the social costs 
and energy security implications of oil use. The energy security 
estimates provided below are based upon a methodology developed in a 
peer-reviewed study entitled, ``The Energy Security Benefits of Reduced 
Oil Use, 2006-2015'', completed in March 2008. This ORNL study is an 
updated version of the approach used for estimating the energy security 
benefits of U.S. oil import reductions developed in a 1997 ORNL 
Report.\872\ For EPA and NHTSA rulemakings, the ORNL methodology is 
updated periodically to account for forecasts of future energy market 
and economic trends reported in the U.S. Energy Information 
Administration's Annual Energy Outlook.
---------------------------------------------------------------------------

    \872\ Leiby, Paul N., Donald W. Jones, T. Randall Curlee, and 
Russell Lee, Oil Imports: An Assessment of Benefits and Costs, ORNL-
6851, Oak Ridge National Laboratory, November, 1997.
---------------------------------------------------------------------------

    When conducting this analysis, ORNL considered the full cost of 
importing petroleum into the U.S. The full economic cost is defined to 
include two components in addition to the purchase price of petroleum 
itself. These are: (1) The higher costs for oil imports resulting from 
the effect of U.S. demand on the world oil price (i.e., the ``demand'' 
or ``monopsony'' costs); and (2) the risk of reductions in U.S. 
economic output and disruption to the U.S. economy caused by sudden 
disruptions in the supply of imported oil to the U.S. (i.e., 
macroeconomic disruption/adjustment costs).
    The literature on energy security for the last two decades has 
routinely combined the monopsony and the macroeconomic disruption 
components when calculating the total value of the energy security 
premium. However, in the context of using a global value for the Social 
Cost of Carbon (SCC) the question arises: how should the energy 
security premium be used when some benefits from these rules, such as 
the benefits of reducing greenhouse gas emissions, are calculated from 
a global perspective? Monopsony benefits represent avoided payments by 
U.S. consumers to oil producers that result from a decrease in the 
world oil price as the U.S. decreases its demand for oil. Although 
there is clearly an overall benefit to the U.S. when considered from a 
domestic perspective, the decrease in price due to decreased demand in 
the U.S. also represents a loss to oil producing countries, one of 
which is the U.S. Given the redistributive nature of this monopsony 
effect from a global perspective, it is excluded in the energy security 
benefits calculations for these final rules.
    In contrast, the other portion of the energy security premium, the 
avoided U.S. macroeconomic disruption and adjustment cost that arises 
from reductions in U.S. petroleum imports, does not have offsetting 
impacts outside of the U.S., and, thus, is included in the energy 
security benefits estimated for these final rules. To summarize, the 
agencies have included only the avoided macroeconomic disruption 
portion of the energy security benefits to estimate the monetary value 
of the total energy security benefits of these final rules.
    For this rulemaking, ORNL updated the energy security premiums by 
incorporating the most recent oil price forecast and energy market 
trends, particularly regional oil supplies and demands, from the AEO 
2015 into its model.\873\ ORNL developed energy security premium 
estimates for a number of different years. Table IX-20 provides 
estimates for energy security premiums for the years 2020, 2025, 2030 
and 2040,\874\ as well as a breakdown of the components of the energy 
security premiums for each year. The components of the energy security 
premiums and their values are discussed below.
---------------------------------------------------------------------------

    \873\ Leiby, P., Factors Influencing Estimate of Energy Security 
Premium for Heavy-Duty Phase 2 Final Rule, 11/1/2014, Oak Ridge 
National Laboratory.
    \874\ AEO 2015 forecasts energy market trends and values only to 
2040. The post-2040 energy security premium values are assumed to be 
equal to the 2040 estimate.

                       Table IX-20--Energy Security Premiums in 2020, 2025, 2030 and 2040
                                                [2013$/Barrel] *
----------------------------------------------------------------------------------------------------------------
                                                                 Avoided  macroeconomic
            Year  (range)                 Monopsony (range)      disruption/adjustment       Total mid-point
                                                                     costs  (range)              (range)
----------------------------------------------------------------------------------------------------------------
2020.................................  $2.21 ($0.65-$3.59)....  $5.48 ($2.51-$8.92)....  $7.69 ($4.54-$11.14)
2025.................................  $2.59 ($0.76-$4.14)....  $6.30 ($2.92-$10.22)...  $8.89 ($5.22-$12.83)
2030.................................  $2.83 (0.83-$4.56).....  $7.26 ($3.40-$11.73)...  $10.09 ($5.90-$14.59)

[[Page 73889]]

 
2040.................................  $4.09 ($1.19-$6.67)....  $9.61 ($4.54-$15.39)...  $13.69 ($8.12-$19.64)
----------------------------------------------------------------------------------------------------------------
Note:
* Top values in each cell are the midpoints, the values in parentheses are the 90 percent confidence intervals.

(a) Effect of Oil Use on the Long-Run Oil Price
    The first component of the full economic costs of importing 
petroleum into the U.S. follows from the effect of U.S. import demand 
on the world oil price over the long-run. Because the U.S. is a 
sufficiently large purchaser of global oil supplies, its purchases can 
affect the world oil price. This monopsony power means that increases 
in U.S. petroleum demand can cause the world price of crude oil to 
rise, and conversely, that reduced U.S. petroleum demand can reduce the 
world price of crude oil. Thus, one benefit of decreasing U.S. oil 
purchases, due to improvements in the fuel efficiency of medium- and 
heavy-duty vehicles, is the potential decrease in the crude oil price 
paid for all crude oil purchased.
    There is disagreement in the literature about the magnitude of the 
monopsony component, and its relevance for policy analysis. Brown and 
Huntington (2013) \875\ for example, argue that the United States' 
refusal to exercise its market power to reduce the world oil price does 
not represent a proper externality, and that the monopsony component 
should not be considered in calculations of the energy security 
externality. However, they also note in their earlier discussion paper 
(Brown and Huntington 2010) \876\ that this is a departure from the 
traditional energy security literature, which includes sustained wealth 
transfers associated with stable but higher-price oil markets. On the 
other hand, Greene (2010) \877\ and others in prior literature (e.g., 
Toman 1993) \878\ have emphasized that the monopsony cost component is 
policy-relevant because the world oil market is non-competitive and 
strongly influenced by cartelized and government-controlled supply 
decisions. Thus, while sometimes couched as an externality, Greene 
notes that the monopsony component is best viewed as stemming from a 
completely different market failure than an externality (Ledyard 
2008),\879\ yet still implying marginal social costs to importers.
---------------------------------------------------------------------------

    \875\ Brown, Stephen P.A. and Hillard G. Huntington. 2013. 
Assessing the U.S. Oil Security Premium. Energy Economics, vol. 38, 
pp 118-127.
    \876\ Reassessing the Oil Security Premium. RFF Discussion Paper 
Series, (RFF DP 10-05). doi: RFF DP 10-05
    \877\ Greene, D. L. 2010. Measuring energy security: Can the 
United States achieve oil independence?, Energy Policy, 38(4), 1614-
1621. doi:10.1016/j.enpol.2009.01.041.
    \878\ Toman, M., 1993, The economics of energy security: theory, 
evidence and policy, Chapter 25, Handbook of Natural Resources and 
Energy Economics, Volume 3, pp. 1167-1218.
    \879\ Ledyard, John O. ``Market Failure.'' The New Palgrave 
Dictionary of Economics. Second Edition. Eds. Steven N. Durlauf and 
Lawrence E. Blume. Palgrave Macmillan, 2008.
---------------------------------------------------------------------------

    Recently, the Council on Foreign Relations (i.e., ``the Council'') 
(2015) released a discussion paper that assesses NHTSA's analysis of 
the benefits and costs of CAFE in a lower-oil-price world.\880\ In this 
paper, the Council notes that while NHTSA cites the monopsony effect of 
the CAFE standards for 2017-2025, NHTSA does not include it when 
calculating the cost-benefit calculation for the rule. The Council 
argues that the monopsony benefit should be included in the CAFE cost-
benefit analysis and that including the monopsony benefit is more 
consistent with the legislators' intent in mandating CAFE standards in 
the first place.
---------------------------------------------------------------------------

    \880\ Council on Foreign Relations, ``Automobile Fuel Economy 
Standards in a Lower-Oil-Price World,'' Sivarm & Levi, November 
2015.
---------------------------------------------------------------------------

    The recent National Academy of Science (NAS 2015) Report, ``Cost, 
Effectiveness and the Deployment of Fuel Economy Technologies for 
Light-Duty Vehicles,'' \881\ suggests that the agencies' logic about 
not accounting for monopsony benefits is inaccurate. According to the 
NAS, the fallacy lies in treating the two problems, oil dependence and 
climate change, similarly. According to the NAS, ``Like national 
defense, it [oil dependence] is inherently adversarial (i.e., oil 
consumers against producers using monopoly power to raise prices). The 
problem of climate change is inherently global and requires global 
action. If each nation considered only the benefits to itself in 
determining what actions to take to mitigate climate change, an 
adequate solution could not be achieved. Likewise, if the U.S. 
considers the economic harm its reduced petroleum use will do to 
monopolistic oil producers it will not adequately address its oil 
dependence problem. Thus, if the United States is to solve both of 
these problems it must take full account of the costs and benefits of 
each, using the appropriate scope for each problem.'' At this point in 
time, we are continuing to exclude monopsony premiums for the cost 
benefit analysis of these final rules, but we will be taking comment on 
this issue in a near term future rulemaking.
---------------------------------------------------------------------------

    \881\ Transitions to Alternative Vehicles and Fuels,'' Committee 
on Transitions to Alternative Vehicles and Fuels, National Research 
Council, 2013.
---------------------------------------------------------------------------

    There is also a question about the ability of gradual, long-term 
reductions, such as those resulting from these final rules, to reduce 
the world oil price in the presence of OPEC's monopoly power. OPEC is 
currently the world's marginal petroleum supplier, and could 
conceivably respond to gradual reductions in U.S. demand with gradual 
reductions in supply over the course of several years as the fuel 
savings resulting from these rules grow. However, if OPEC opts for a 
long-term strategy to preserve its market share, rather than maintain a 
particular price level (as they have done recently in response to 
increasing U.S. petroleum production), reduced demand will create 
downward pressure on the global price. The Oak Ridge analysis assumes 
that OPEC does respond to demand reductions over the long run, but 
there is still a price effect in the model. Under the mid-case 
behavioral assumption used in the premium calculations, OPEC responds 
by gradually reducing supply to maintain market share (consistent with 
the long-term self-interested strategy suggested by Gately (2004, 
2007)).\882\
---------------------------------------------------------------------------

    \882\ Gately, Dermot, 2004. ``OPEC's Incentives for Faster 
Output Growth,'' The Energy Journal, 25 (2):75-96; Gately, Dermot, 
2007. ``What Oil Export Levels Should We Expect From OPEC?'', The 
Energy Journal, 28(2):151-173.

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

[[Page 73890]]

(b) Macroeconomic Disruption Adjustment Costs
    The second component of the oil import premium, ``avoided 
macroeconomic disruption/adjustment costs,'' arises from the effect of 
oil imports on the expected cost of supply disruptions and accompanying 
price increases. A sudden increase in oil prices triggered by a 
disruption in world oil supplies has two main effects: (1) It increases 
the costs of oil imports in the short-run and (2) it can lead to 
macroeconomic contraction, dislocation and Gross Domestic Product (GDP) 
losses. For example, ORNL estimates the combined value of these two 
factors to be $6.30/barrel (2013$) when U.S. oil imports are reduced in 
2025, with a range from $2.92/barrel to $10.22/barrel of imported oil 
reduced.
    Since future disruptions in foreign oil supplies are an uncertain 
prospect, each of the disruption cost components must be weighted by 
the probability that the supply of petroleum to the U.S. will actually 
be disrupted. Thus, the ``expected value'' of these costs--the product 
of the probability that a supply disruption will occur and the sum of 
costs from reduced economic output and the economy's abrupt adjustment 
to sharply higher petroleum prices--is the relevant measure of their 
magnitude. Further, when assessing the energy security value of a 
policy to reduce oil use, it is only the change in the expected costs 
of disruption that results from the policy that is relevant. The 
expected costs of disruption may change from lowering the normal (i.e., 
pre-disruption) level of domestic petroleum use and imports, from any 
induced alteration in the likelihood or size of disruption, or from 
altering the short-run flexibility (e.g., elasticity) of petroleum use.
    By late 2015/early 2016, world oil prices were sharply lower than 
in 2014. Future prices remain uncertain, but sustained markedly lower 
oil prices can have mixed implications for U.S. energy security. Under 
lower prices U.S. expenditures on oil consumption are lower, and they 
are a less prominent component of the U.S. economy. This would lessen 
the issue of imported oil as an energy security problem for the U.S. On 
the other hand, sustained lower oil prices encourage greater oil 
consumption, and reduce the competitiveness of new U.S. oil supplies 
and alternative fuels. The AEO 2015 low oil price outlook, for example, 
projects that by 2030 total U.S. petroleum supply would be 10 percent 
lower and imports would be 78 percent higher than the AEO Reference 
Case. Under the low-price case, 2030 prices are 35 percent lower, so 
that import expenditures are 16 percent higher.
    A second potential proposed energy security effect of lower oil 
prices is increased instability of supply, due to greater global 
reliance on fewer suppling nations,\883\ and because lower prices may 
increase economic and geopolitical instability in some supplier 
nations.884 885 886 The International Monetary Fund reported 
that low oil prices are creating substantial economic tension in the 
Middle East oil producers on top of the economic costs of ongoing 
conflicts, and noted the risk that Middle East countries including 
Saudi Arabia could run out of financial assets without substantial 
change in policy.\887\ The concern raised is that oil revenues are 
essential for some exporting nations to fund domestic programs and 
avoid domestic unrest.
---------------------------------------------------------------------------

    \883\ Fatih Birol, Executive Director of the International 
Energy Agency, warns that prolonged lower oil prices would trigger 
energy security concerns by increasing reliance on a small number of 
low-cost producers ``or risk a sharp rebound in price if investment 
falls short.'' ``It would be a grave mistake to index our attention 
to energy security to changes in the oil price,'' Birol said. ``Now 
is not the time to relax. Quite the opposite: a period of low oil 
prices is the moment to reinforce our capacity to deal with future 
energy security threats.'' Hussain, Y. (2015). ``Grave mistake'' to 
be complacent on energy security, International Energy Agency warns. 
Financial Post, (November 10). Retrieved from http://business.financialpost.com/news/energy/grave-mistake-to-be-complacent-on-energy-security-international-energy-agency-warns.
    \884\ Batovic, A. (2015). Low oil prices fuel political and 
economic instability. Global Risk Insights, 18-19. Retrieved from 
http://globalriskinsights.com/2015/09/low-oil-prices-fuel-political-and-economic-instability/.
    \885\ Monaldi, F. (2015). The Impact of the Decline in Oil 
Prices on the Economics, Politics and Oil Industry of Venezuela. 
Columbia Center on Global Energy Policy Discussion Papers, 
(September). Retrieved from http://energypolicy.columbia.edu/sites/default/files/energy/Impact of the Decline in Oil Prices on 
Venezuela, September 2015.pdf.
    \886\ Even, S., & Guzansky, Y. (2015). Falling oil prices and 
Saudi stability--Opinion. Jerusalem Post, (September 30). Retrieved 
from http://www.jpost.com/Opinion/Falling-oil-prices-and-Saudi-stability-419534.
    \887\ International Monetary Fund (IMF). (2015). IMF Regional 
Economic Outlook--Middle East and Central Asia. Regional Economic 
Outlook (Vol. 33). Tomkiw, L. (2015). Oil Rich Saudi Arabia Running 
Out Of Assets? IMF Report Says It's Possible In Next 5 Years. 
International Business Times, October 21, 19-22. Retrieved from 
http://www.ibtimes.com/oil-rich-saudi-arabia-running-out-assets-imf-report-says-its-possible-next-5-years-215017.
---------------------------------------------------------------------------

    The Competitive Enterprise Institute (CEI) and others argue that 
there are little, if any, energy security benefits associated with 
these rules. In large part CEI argues that oil supplies are plentiful 
and that current oil prices are low so that reduced consumption of 
petroleum products due to these rules would have no effect on energy 
security. However, the discussion of current low oil prices (``lowest 
Labor Day gasoline prices in a decade'') does not assure the absence of 
future oil supply shocks or price shocks, or even speak to their 
reduced likelihood. CEI points out that the current low oil prices have 
been observed before as recently as a decade ago, as they have in more 
than one instance before that. For example, oil prices were even lower 
in 1999. But in the intervening periods, oil supply and price shocks 
have continued to recur, and the recent price record only amplifies 
oil's high historical price volatility.
    Also, sharply lower world oil prices do not clearly imply greater 
energy security for the U.S. Current low world oil prices may reduce 
the U.S.'s fracking industry's tight oil production (as CEI points 
out), or other sources of oil supplies around the world. Some have 
hypothesized that reduction in oil production outside of OPEC may be 
the objective of some OPEC producers. With low oil prices, U.S.' oil 
import share over time might be larger, increasing the U.S.' dependence 
on imported oil.
    Securing America's Future Energy (SAFE), Operation Free and the 
Investor Network on Climate Risk agree that these rules do improve 
America's energy security. SAFE goes on to state that several policy 
options should be included in these rules to further enhance energy 
security. The agencies agree that these rules enhances America's energy 
security, but do not have information to evaluate the policy options 
that SAFE proposes.
    The recent economics literature on whether oil shocks are the 
threat to economic stability that they once were is mixed. Some of the 
current literature asserts that the macroeconomic component of the 
energy security externality is small. For example, the National 
Research Council (2009) argued that the non-environmental externalities 
associated with dependence on foreign oil are small, and potentially 
trivial.\888\ Analyses by Nordhaus (2007) and Blanchard and Gali (2010) 
question the impact of more recent oil price shocks on the 
economy.\889\ They were motivated by

[[Page 73891]]

attempts to explain why the economy actually expanded immediately after 
the last shocks, and why there was no evidence of higher energy prices 
being passed on through higher wage inflation. Using different 
methodologies, they conclude that the economy has largely gotten over 
its concern with dramatic swings in oil prices.
---------------------------------------------------------------------------

    \888\ National Research Council, 2009. Hidden Costs of Energy: 
Unpriced Consequences of Energy Production and Use. National Academy 
of Science, Washington, DC.
    \889\ See, William Nordhaus, ``Who's Afraid of a Big Bad Oil 
Shock?'', available at http://aida.econ.yale.edu/~nordhaus/homepage/
Big_Bad_Oil_Shock_Meeting.pdf, and Olivier Blanchard and Jordi Gali, 
``The macroeconomic Effects of Oil price Shocks: Why are the 2000s 
so different from the 1970s?'', pp. 373-421, in The International 
Dimensions of Monetary Policy, Jordi Gali and Mark Gertler, editors, 
University of Chicago Press, February 2010, available at http://www.nber.org/chapters/c0517.pdf.
---------------------------------------------------------------------------

    One reason, according to Nordhaus, is that monetary policy has 
become more accommodating to the price impacts of oil shocks. Another 
is that consumers have simply decided that such movements are 
temporary, and have noted that price impacts are not passed on as 
inflation in other parts of the economy. He also notes that real 
changes to productivity due to oil price increases are incredibly 
modest, \890\ and that the general direction of the economy matters a 
great deal regarding how the economy responds to a shock. Estimates of 
the impact of a price shock on aggregate demand are insignificantly 
different from zero.
---------------------------------------------------------------------------

    \890\ In fact, ``. . . energy-price changes have no effect on 
multifactor productivity and very little effect on labor 
productivity.'' Page 19. He calculates the productivity effect of a 
doubling of oil prices as a decrease of 0.11 percent for one year 
and 0.04 percent a year for ten years. Page 5. (The doubling 
reflects the historical experience of the post-war shocks, as 
described in Table 7.1 in Blanchard and Gali, p. 380).
---------------------------------------------------------------------------

    Blanchard and Gali (2010) contend that improvements in monetary 
policy (as noted above), more flexible labor markets, and lessening of 
energy intensity in the economy, combined with an absence of concurrent 
shocks, all contributed to lessen the impact of oil shocks after 1980. 
They find ``. . . the effects of oil price shocks have changed over 
time, with steadily smaller effects on prices and wages, as well as on 
output and employment.'' \891\ In a comment at the chapter's end, this 
work is summarized as follows: ``The message of this chapter is thus 
optimistic in that it suggests a transformation in U.S. institutions 
has inoculated the economy against the responses that we saw in the 
past.''
---------------------------------------------------------------------------

    \891\ Blanchard and Gali, p. 414.
---------------------------------------------------------------------------

    At the same time, the implications of the ``Shale Oil Revolution'' 
are now being felt in the international markets, with current prices at 
four year lows. Analysts generally attribute this result in part to the 
significant increase in supply resulting from U.S. production, which 
has put liquid petroleum production roughly on par with Saudi Arabia. 
The price decline is also attributed to the sustained reductions in 
U.S. consumption and global demand growth from fuel efficiency policies 
and previously high oil prices. The resulting decrease in foreign 
imports, down to about one-third of domestic consumption (from 60 
percent in 2005, for example \892\), effectively permits U.S. supply to 
act as a buffer against artificial or other supply restrictions (the 
latter due to conflict or a natural disaster, for example).
---------------------------------------------------------------------------

    \892\ See, Oil price Drops on Oversupply, http://www.oil-price.net/en/articles/oil-price-drops-on-oversupply.php, 10/6/2014.
---------------------------------------------------------------------------

    However, other papers suggest that oil shocks, particularly sudden 
supply shocks, remain a concern. Both Blanchard and Gali's and Nordhaus 
work were based on data and analysis through 2006, ending with a period 
of strong global economic growth and growing global oil demand. The 
Nordhaus work particularly stressed the effects of the price increase 
from 2002-2006 that were comparatively gradual (about half the growth 
rate of the 1973 event and one-third that of the 1990 event). The 
Nordhaus study emphasizes the robustness of the U.S. economy during a 
time period through 2006. This time period was just before rapid 
further increases in the price of oil and other commodities with oil 
prices more-than-doubling to over $130/barrel by mid-2008, only to drop 
after the onset of the largest recession since the Great Depression.
    Hamilton (2012) reviewed the empirical literature on oil shocks and 
suggested that the results are mixed, noting that some work (e.g. 
Rasmussen and Roitman (2011) finds less evidence for economic effects 
of oil shocks, or declining effects of shocks (Blanchard and Gali 
2010), while other work continues to find evidence regarding the 
economic importance of oil shocks. For example, Baumeister and Peersman 
(2011) found that an oil price increase had a decreasing effect over 
time. But they note that with a declining price-elasticity of demand 
that a given physical oil disruption would have a bigger effect on 
price and a similar effect on output as in the earlier data.\893\ 
Hamilton observes that ``a negative effect of oil prices on real output 
has also been reported for a number of other countries, particularly 
when nonlinear functional forms have been employed''. Alternatively, 
rather than a declining effect, Ramey and Vine (2010) \894\ found 
``remarkable stability in the response of aggregate real variables to 
oil shocks once we account for the extra costs imposed on the economy 
in the 1970s by price controls and a complex system of entitlements 
that led to some rationing and shortages.''
---------------------------------------------------------------------------

    \893\ Hamilton, J. D. (2012). Oil Prices, Exhaustible Resources, 
and Economic Growth. In Handbook of Energy and Climate Change. 
Retrieved from http://econweb.ucsd.edu/~jhamilto/
handbook_climate.pdf.
    \894\ Ramey, V. and Vine, D., 2010, ``Oil, Automobiles, and the 
U.S. Economy: How Much have Things Really Changed?'' National Bureau 
of Economic Research Working Papers, WP 16067. Retrieved from http://www.nber.org/papers/w16067.pdf [EPA-HQ-OAR-2014-0827-0601].
---------------------------------------------------------------------------

    Some of the recent literature on oil price shocks has emphasized 
that economic impacts depend on the nature of the oil shock, with 
differences between price increases caused by sudden supply loss and 
those caused by rapidly growing demand. Most recent analyses of oil 
price shocks have confirmed that ``demand-driven'' oil price shocks 
have greater effects on oil prices and tend to have positive effects on 
the economy while ``supply-driven'' oil shocks still have negative 
economic impacts (Baumeister, Peersman and Van Robays (2010)).\895\ A 
recent paper by Kilian and Vigfusson (2014), \896\ for example, 
assigned a more prominent role to the effects of price increases that 
are unusual, in the sense of being beyond range of recent experience. 
Kilian and Vigfusson also conclude that the difference in response to 
oil shocks may well stem from the different effects of demand- and 
supply-based price increases: ``One explanation is that oil price 
shocks are associated with a range of oil demand and oil supply shocks, 
some of which stimulate the U.S. economy in the short run and some of 
which slow down U.S. growth (see Kilian (2009)). How recessionary the 
response to an oil price shock is thus depends on the average 
composition of oil demand and oil supply shocks over the sample 
period.''
---------------------------------------------------------------------------

    \895\ Baumeister, C., Peersman, G., Van Robays, I., 2010, ``The 
Economic Consequences of Oil Shocks: Differences across Countries 
and Time'', Workshop and Conference on Inflation Challenges in the 
Era of Relative Price Shocks.
    \896\ Kilian, L., Vigfusson, R.J., 2014, ``The Role of Oil Price 
Shocks in Causing U.S. Recessions'', Board of Governors of the 
Federal Reserve System. International Finance Discussion Papers.
---------------------------------------------------------------------------

    The general conclusion that oil supply-driven shocks reduce 
economic output is also reached in a recently published paper by Cashin 
et al. (2014) \897\ for 38 countries from 1979-2011. ``The results 
indicate that the economic consequences of a supply-driven oil-price 
shock are very different from those of an oil-demand shock

[[Page 73892]]

driven by global economic activity, and vary for oil-importing 
countries compared to energy exporters,'' and ``oil importers 
[including the U.S.] typically face a long-lived fall in economic 
activity in response to a supply-driven surge in oil prices'' but 
almost all countries see an increase in real output for an oil-demand 
disturbance. Note that the energy security premium calculation in this 
analysis is based on price shocks from potential future supply events 
only.
---------------------------------------------------------------------------

    \897\ Cashin, P., Mohaddes, K., Raissi, Maziar, and Raissi, M., 
2014, ``The differential effects of oil demand and supply shocks on 
the global economy''. Energy Economics.
---------------------------------------------------------------------------

    Finally, despite continuing uncertainty about oil market behavior 
and outcomes and the sensitivity of the U.S. economy to oil shocks, it 
is generally agreed that it is beneficial to reduce petroleum fuel 
consumption from an energy security standpoint. It is not just imports 
alone, but both imports and consumption of petroleum from all sources 
and their role in economic activity, that may expose the U.S. to risk 
from price shocks in the world oil price. Reducing fuel consumption 
reduces the amount of domestic economic activity associated with a 
commodity whose price depends on volatile international markets.
(c) Cost of Existing U.S. Energy Security Policies
    The last often-identified component of the full economic costs of 
U.S. oil imports are the costs to the U.S. taxpayers of existing U.S. 
energy security policies. The two primary examples are maintaining the 
Strategic Petroleum Reserve (SPR) and maintaining a military presence 
to help secure a stable oil supply from potentially vulnerable regions 
of the world. The SPR is the largest stockpile of government-owned 
emergency crude oil in the world. Established in the aftermath of the 
1973/1974 oil embargo, the SPR provides the U.S. with a response option 
should a disruption in commercial oil supplies threaten the U.S. 
economy. It also allows the U.S. to meet part of its International 
Energy Agency obligation to maintain emergency oil stocks, and it 
provides a national defense fuel reserve. While the costs for building 
and maintaining the SPR are more clearly related to U.S. oil use and 
imports, historically these costs have not varied in response to 
changes in U.S. oil import levels. Thus, while the effect of the SPR in 
moderating price shocks is factored into the ORNL analysis, the cost of 
maintaining the SPR is excluded.
    U.S. military costs are excluded from the analysis performed by 
ORNL because their attribution to particular missions or activities is 
difficult, and because it is not clear that these outlays would decline 
in response to incremental reductions in U.S. oil imports. Most 
military forces serve a broad range of security and foreign policy 
objectives. The agencies also recognize that attempts to attribute some 
share of U.S. military costs to oil imports are further challenged by 
the need to estimate how those costs might vary with incremental 
variations in U.S. oil imports.
    In the proposal to these rules, the agencies solicited comments on 
quantifying the military benefits from reduced U.S. imports of oil. The 
California Air Resources Board (CARB) notes that the National Research 
Council (NRC) \898\ attempted to estimate the military costs associated 
with U.S. imports and consumption of petroleum. The NRC cited estimates 
of the national defense costs of oil dependence from the literature 
that range from less than $5 to $50 billion per year or more. Assuming 
a range of approximate range of $10 to $50 billion per year, the NRC 
divided national defense costs by a projected U.S. consumption rate of 
approximately 6.4 billion barrels per year (EIA, 2012). This procedure 
yielded a range of average national defense cost of $1.50-$8.00 per 
barrel (rounded to the nearest $0.50), with a mid-point of $5/barrel 
(in 2009$). The agencies acknowledge this NRC study, but have not 
included the estimates as part of the cost-benefit analysis for these 
rules.
---------------------------------------------------------------------------

    \898\ National Research Council, ``Transitions to alternative 
vehicles and fuels,'' 2013.
---------------------------------------------------------------------------

(3) Energy Security Benefits of This Program
    Using the ORNL ``oil premium'' methodology, updating world oil 
price values and energy trends using AEO 2015 and using the estimated 
fuel savings from these final rules estimated from the MOVES/CAFE 
models, the agencies have calculated the annual energy security 
benefits of these final rules through 2050.\899\ Since the agencies are 
taking a global perspective with respect to valuing greenhouse gas 
benefits from the rules, only the avoided macroeconomic adjustment/
disruption portion of the energy security premium is used in the energy 
security benefits estimates present below. These results are shown 
below in Table IX-21. The agencies have also calculated the net present 
value at 3 percent and 7 percent discount rates of model year lifetime 
benefits associated with energy security; these values are presented in 
Table IX-22.
---------------------------------------------------------------------------

    \899\ In order to determine the energy security benefits beyond 
2040, we use the 2040 energy security premium multiplied by the 
estimate fuel savings from the final rule. Since the AEO 2015 only 
goes to 2040, we only calculate energy security premiums to 2040.

 Table IX-21--Annual U.S. Energy Security Benefits of the Final Program
  and Net Present Values at 3% and 7% Discount Rates Using Method B and
             Relative to a Flat Baseline for Final HDV Rules
                       [In Millions of 2013$] \a\
------------------------------------------------------------------------
                                                                Benefits
                             Year                               (2013$)
------------------------------------------------------------------------
2018.........................................................         $4
2019.........................................................          9
2020.........................................................         14
2021.........................................................         55
2022.........................................................        109
2023.........................................................        171
2024.........................................................        268
2025.........................................................        372
2026.........................................................        482
2027.........................................................        627
2028.........................................................        775
2029.........................................................        923
2030.........................................................      1,074
2035.........................................................      1,847
2040.........................................................      2,533
2050.........................................................      3,025
NPV, 3%......................................................     24,716
NPV, 7%......................................................     10,050
------------------------------------------------------------------------


Table IX-22--Discounted Model Year Lifetime Energy Security Benefits Due
   to the Final Program at 3% and 7% Discount Rates Using Method B and
             Relative to a Flat Baseline for Final HDV Rules
                         [Millions of 2013$] \a\
------------------------------------------------------------------------
                                                        3%         7%
                   Calendar year                     Discount   Discount
                                                       rate       rate
------------------------------------------------------------------------
2018..............................................        $30        $21
2019..............................................         29         20
2020..............................................         28         18
2021..............................................        485        294
2022..............................................        520        304
2023..............................................        552        311
2024..............................................        849        461
2025..............................................        886        464
2026..............................................        917        463
2027..............................................      1,183        577
2028..............................................      1,182        555
2029..............................................      1,184        536
------------------------------------------------------------------------
    Sum...........................................      7,844      4,026
------------------------------------------------------------------------

J. Other Impacts

(1) Costs of Noise, Congestion and Crashes Associated With Additional 
(Rebound) Driving
    Although it provides benefits to drivers as described above, 
increased vehicle use associated with the rebound effect also 
contributes to increased

[[Page 73893]]

traffic congestion, motor vehicle crashes, and highway noise. Depending 
on how the additional travel is distributed over the day and where it 
takes place, additional vehicle use can contribute to traffic 
congestion and delays by increasing the number of vehicles using 
facilities that are already heavily traveled. These added delays impose 
higher costs on drivers and other vehicle occupants in the form of 
increased travel time and operating expenses. At the same time, this 
additional travel also increases costs associated with traffic crashes 
and vehicle noise.
    The agencies estimate these costs using the same methodology as 
used in the two light-duty and the HD Phase 1 rule analyses, which 
relies on estimates of congestion, crash, and noise costs imposed by 
automobiles and light trucks developed by the Federal Highway 
Administration to estimate these increased external costs caused by 
added driving.\900\ We provide the details behind the estimates in 
Chapter 8.7 of the RIA. Table IX-23 presents the estimated annual 
impacts associated with crash, congestion and noise along with net 
present values at both 3 percent and 7 percent discount rates. Table 
IX-24 presents the estimated discounted model year lifetime impacts 
associated with crashes, congestion and noise. The methodology used in 
this final rule is the same as that used in the proposal, except that 
costs were updated to 2013 dollars.
---------------------------------------------------------------------------

    \900\ These estimates were developed by FHWA for use in its 1997 
Federal Highway Cost Allocation Study; http://www.fhwa.dot.gov/policy/hcas/final/index.htm (last accessed July 8, 2012).

 Table IX-23--Annual Costs Associated With Crashes, Congestion and Noise
  and Net Present Values at 3% and 7% Discount Rates Using Method B and
                      Relative to the Flat Baseline
                         [Millions of 2013$] \a\
------------------------------------------------------------------------
                                                              Costs of
                                                              crashes,
                       Calendar year                         congestion,
                                                              and noise
------------------------------------------------------------------------
2018......................................................            $0
2019......................................................             0
2020......................................................             0
2021......................................................            99
2022......................................................           139
2023......................................................           178
2024......................................................           216
2025......................................................           252
2026......................................................           285
2027......................................................           317
2028......................................................           345
2029......................................................           372
2030......................................................           396
2035......................................................           487
2040......................................................           541
2050......................................................           604
NPV, 3%...................................................         6,755
NPV, 7%...................................................         3,070
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.


Table IX-24--Discounted Model Year Lifetime Costs of Crashes, Congestion
and Noise at 3% and 7% Discount Rates Using Method B and Relative to the
                              Flat Baseline
                         [Millions of 2013$] \a\
------------------------------------------------------------------------
                                                        3%         7%
                   Calendar year                     discount   Discount
                                                       rate       rate
------------------------------------------------------------------------
2018..............................................       $124        $80
2019..............................................        140         89
2020..............................................        158        100
2021..............................................        343        215
2022..............................................        333        201
2023..............................................        323        187
2024..............................................        319        178
2025..............................................        313        168
2026..............................................        305        158
2027..............................................        297        148
2028..............................................        289        139
2029..............................................        283        131
                                                   ---------------------
    Sum...........................................      3,227      1,793
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.

(2) Benefits Associated With Reduced Refueling Time
    By reducing the frequency with which drivers typically refuel their 
vehicles and by extending the upper limit of the range that can be 
traveled before requiring refueling (i.e., future fuel tank sizes 
remain constant), savings will be realized associated with less time 
spent refueling vehicles. Alternatively, refill intervals may remain 
the same (i.e., future fuel tank sizes get smaller), resulting in the 
same number of refills as today but less time spent per refill because 
there will be less fuel to refill. The agencies have estimated this 
impact using the former approach--by assuming that future tank sizes 
remain constant.
    The savings in refueling time are calculated as the total amount of 
time the driver of a typical truck in each class will save each year as 
a consequence of pumping less fuel into the vehicle's tank. The 
calculation does not include any reduction in time spent searching for 
a fueling station or other time spent at the station; it is assumed 
that time savings occur only when truck operators are actually 
refueling their vehicles.
    The calculation uses the reduced number of gallons consumed by 
truck type and divides that value by the tank volume and refill amount 
to get the number of refills, then multiplies that by the time per 
refill to determine the number of hours saved in a given year. The 
calculation then applies DOT-recommended values of travel time savings 
to convert the resulting time savings to their economic value, 
including a 1.2 percent growth rate in those time savings going 
forward.\901\ The input metrics used in the analysis are presented in 
greater detail in RIA Chapter 9.7. The annual benefits associated with 
reduced refueling time are shown in Table IX-25 along with net present 
values at both 3 percent and 7 percent discount rates. The discounted 
model year lifetime benefits are shown in Table IX-26. The methodology 
used in this final rule is the same as that used in the proposal, 
except that costs have been updated to 2013 dollars.
---------------------------------------------------------------------------

    \901\ U.S. Department of Transportation, Valuation of Travel 
Guidance, July 9, 2014, at page 14.

 Table IX-25--Annual Refueling Benefits and Net Present Values at 3% and
   7% Discount Rates Using Method B and Relative to the Flat Baseline
                          [Millions of 2013$] a
------------------------------------------------------------------------
                                                              Refueling
                       Calendar year                           benefits
------------------------------------------------------------------------
2018.......................................................           $1
2019.......................................................            3
2020.......................................................            5
2021.......................................................           27
2022.......................................................           56
2023.......................................................           91
2024.......................................................          144
2025.......................................................          202
2026.......................................................          264
2027.......................................................          342
2028.......................................................          420
2029.......................................................          495
2030.......................................................          570
2035.......................................................          895
2040.......................................................        1,141

[[Page 73894]]

 
2050.......................................................        1,497
NPV, 3%....................................................       11,985
NPV, 7%....................................................        4,925
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.


  Table IX-26--Discounted Model Year Lifetime Refueling Benefits Using
               Method B and Relative to the Flat Baseline
                          [Millions of 2013$] a
------------------------------------------------------------------------
                                                        3%         7%
                    Model year                       discount   discount
                                                       rate       rate
------------------------------------------------------------------------
2018..............................................         $9         $7
2019..............................................          9          6
2020..............................................          8          6
2021..............................................        218        135
2022..............................................        255        152
2023..............................................        290        166
2024..............................................        428        236
2025..............................................        461        245
2026..............................................        491        251
2027..............................................        609        300
2028..............................................        601        285
2029..............................................        594        272
                                                   ---------------------
Sum...............................................      3,976      2,061
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.

(3) Benefits of Increased Travel Associated With Rebound Driving
    The increase in travel associated with the rebound effect produces 
additional benefits to vehicle owners and operators, which reflect the 
value of the added (or more desirable) social and economic 
opportunities that become accessible with additional travel. The 
analysis estimates the economic benefits from increased rebound-effect 
driving as the sum of fuel expenditures incurred plus the consumer 
surplus from the additional accessibility it provides. As evidenced by 
the fact that vehicles make more frequent or longer trips when the cost 
of driving declines, the benefits from this added travel exceed added 
expenditures for the fuel consumed. The amount by which the benefits 
from this increased driving exceed its increased fuel costs measures 
the net benefits from the additional travel, usually referred to as 
increased consumer surplus.
    The agencies' analysis estimates the economic value of the 
increased consumer surplus provided by added driving using the 
conventional approximation, which is one half of the product of the 
decline in vehicle operating costs per vehicle-mile and the resulting 
increase in the annual number of miles driven. Because it depends on 
the extent of improvement in fuel economy, the value of benefits from 
increased vehicle use changes by model year and varies among 
alternative standards. Under even those alternatives that will impose 
the highest standards, however, the magnitude of the consumer surplus 
from additional vehicle use represents a small fraction of this 
benefit.
    The annual benefits associated with increased travel are shown in 
Table IX-27 along with net present values at both 3 percent and 7 
percent discount rates. The discounted model year lifetime benefits are 
shown in Table IX-28. The methodology used in this final rule is the 
same as that used in the proposal, except that costs have been updated 
to 2013 dollars.

 Table IX-27--Annual Value of Increased Travel and Net Present Values at
    3% and 7% Discount Rates Using Method B and Relative to the Flat
                                Baseline
                          [Millions of 2013$] a
------------------------------------------------------------------------
                                                             Benefits of
                       Calendar year                          increased
                                                               travel
------------------------------------------------------------------------
2018......................................................            $0
2019......................................................             0
2020......................................................             0
2021......................................................           298
2022......................................................           417
2023......................................................           534
2024......................................................           648
2025......................................................           759
2026......................................................           866
2027......................................................           967
2028......................................................         1,064
2029......................................................         1,157
2030......................................................         1,247
2035......................................................         1,660
2040......................................................         2,043
2050......................................................         2,284
NPV, 3%...................................................        23,357
NPV, 7%...................................................        10,343
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.


Table IX-28--Discounted Model Year Lifetime Value of Increased Travel at
    3% and 7% Discount Rates Using Method B and Relative to the Flat
                                Baseline
                          [Millions of 2013$] a
------------------------------------------------------------------------
                                                        3%         7%
                   Calendar year                     discount   discount
                                                       rate       rate
------------------------------------------------------------------------
2018..............................................       $452       $285
2019..............................................        511        319
2020..............................................        580        358
2021..............................................      1,054        647
2022..............................................      1,038        613
2023..............................................      1,020        580
2024..............................................      1,001        549
2025..............................................        994        525
2026..............................................        982        500
2027..............................................        951        466
2028..............................................        942        445
2029..............................................        937        427
                                                   ---------------------
    Sum...........................................     10,462      5,715
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the flat baseline, 1a, and dynamic
  baseline, 1b, please see Section X.A.1.

K. Summary of Benefits and Costs

    This section presents the costs, benefits, and other economic 
impacts of the Phase 2 standards. It is important to note that NHTSA's 
fuel consumption standards and EPA's GHG standards will both be in 
effect, and will jointly lead to increased fuel efficiency and 
reductions in GHG and non-GHG emissions. The individual categories of 
benefits and costs presented in the tables below are defined more fully 
and presented in more detail in Chapter 8 of the RIA. These include:
     The vehicle program costs (costs of complying with the 
vehicle COa; and fuel consumption standards),
     changes in fuel expenditures associated with reduced fuel 
use by more efficient vehicles and increased fuel use associated with 
the ``rebound'' effect, both of which result from the program,
     the global economic value of reductions in GHGs,
     the economic value of reductions in non-GHG pollutants,
     costs associated with increases in noise, congestion, and 
crashes resulting from increased vehicle use,
     savings in drivers' time from less frequent refueling,
     benefits of increased vehicle use associated with the 
``rebound'' effect, and
     the economic value of improvements in U.S. energy security 
impacts.

[[Page 73895]]

    For a discussion of the cost of ownership and the agencies' payback 
analysis of vehicles covered by this rule, please see Section IX.M.
    The agencies conducted two analyses using two analytical methods 
referred to as Method A and Method B. For an explanation of these 
methods, please see Section I.D. And as discussed in Section X.A.1, the 
agencies present estimates of benefits and costs that are measured 
against two different assumptions about improvements in fuel efficiency 
that might occur in the absence of the Phase 2 standards. The first 
case (Alternative 1a) uses a baseline that projects very little 
improvement in new vehicles in the absence of new Phase 2 standards, 
and the second (Alternative 1b) uses a more dynamic baseline that 
projects more significant improvements in vehicle fuel efficiency.
    Table IX-29 shows benefits and costs for these standards from the 
perspective of a program designed to improve the nation's energy 
security and conserve energy by improving fuel efficiency. From this 
viewpoint, technology costs occur when the vehicle is purchased. Fuel 
savings are counted as benefits that occur over the lifetimes of the 
vehicles produced during the model years subject to the Phase 2 
standards as they consume less fuel. The table shows that benefits far 
outweigh the costs, and the final program is anticipated to result in 
large net benefits to the U.S economy.

  Table IX-29--Lifetime Benefits & Costs of the Final Program for Model Years 2018-2029 Vehicles Using Analysis
                                                    Method A
                                   [Billions of 2013$ discounted at 3% and 7%]
----------------------------------------------------------------------------------------------------------------
                                                            Baseline 1a                     Baseline 1b
                    Category                     ---------------------------------------------------------------
                                                        3%              7%              3%              7%
----------------------------------------------------------------------------------------------------------------
Vehicle Program: Technology and Indirect Costs,             24.4            16.6            23.7            16.1
 Normal Profit on Additional Investments........
Additional Routine Maintenance..................             1.7             0.9             1.7             0.9
Congestion, Crashes, Fatalities and Noise from               3.2             1.9             3.1             1.8
 Increased Vehicle Use \a\......................
                                                 ---------------------------------------------------------------
    Total Costs.................................            29.3            19.4            28.5            18.8
----------------------------------------------------------------------------------------------------------------
Fuel Savings (valued at pre-tax prices).........           163.0            87.0           149.1            79.7
Savings from Less Frequent Refueling............             3.2             1.7             3.0             1.6
Economic Benefits from Additional Vehicle Use...             5.5             3.5             5.4             3.4
                                                 ---------------------------------------------------------------
Reduced Climate Damages from GHG Emissions \b\..               36.0
                                                               33.0
                                                 ---------------------------------------------------------------
Reduced Health Damages from Non-GHG Emissions...            30.0            16.1            27.1            14.6
Increased U.S. Energy Security..................             7.9             4.2             7.3             3.9
                                                 ---------------------------------------------------------------
    Total Benefits..............................             246             149             225             136
    Net Benefits................................             216             129             197             117
----------------------------------------------------------------------------------------------------------------
Notes:
\a\ ``Congestion, Crashes, Fatalities and Noise from Increased Vehicle Use'' includes NHTSA's monetized value of
  estimated reductions in the incidence of highway fatalities associated with mass reduction in HD pickup and
  vans, but this does not include these reductions from tractor-trailers or vocational vehicles. This likely
  results in a conservative overestimate of these costs.
\b\ Benefits and net benefits use the 3 percent average global SC-CO[ihel2], SC-CH4, and SC-N[ihel2]O value
  applied to CO[ihel2], CH4, and N[ihel2]O emissions, respectively; GHG reductions also include HFC reductions,
  and include benefits to other nations as well as the U.S. See RIA Chapter 8.5 and Preamble Section IX.G for
  further discussion.

    Table IX-30 through Table IX-32 report benefits and cost from the 
perspective of reducing GHG. Table IX-30 shows the annual impacts and 
net benefits of the final program for selected future years, together 
with the net present values of cumulative annual impacts from 2018 
through 2050, discounted at 3 percent and 7 percent rates.
    Table IX-31 and Table IX-32 show the discounted lifetime costs and 
benefits for each model year affected by the Phase 2 standards at 3 
percent and 7 percent discount rates, respectively.

  Table IX-30--Annual Benefits & Costs of the Final Program and Net Present Values at 3% and 7% Discount Rates Using Method B and Relative to the Flat
                                                                        Baseline
                                                                 [Billions of 2013$] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   2018     2021     2024     2030     2035     2040     2050     NPV, 3%      NPV, 7%
--------------------------------------------------------------------------------------------------------------------------------------------------------
Vehicle program................................................    -$0.2    -$2.5    -$4.2    -$5.2    -$5.7    -$6.3    -$7.3       -$87.8       -$41.9
Maintenance....................................................      0.0      0.0     -0.1     -0.2     -0.2     -0.2     -0.2         -3.2         -1.5
Pre-tax fuel...................................................      0.1      1.3      6.1     23.4     38.9     53.1     63.4        523.3        213.8
Energy security................................................      0.0      0.1      0.3      1.1      1.8      2.5      3.0         24.7         10.1
Crashes/Congestion/Noise.......................................      0.0     -0.1     -0.2     -0.4     -0.5     -0.5     -0.6         -6.8         -3.1
Refueling impacts..............................................      0.0      0.0      0.1      0.6      0.9      1.1      1.5         12.0          4.9
Travel value...................................................      0.0      0.3      0.6      1.2      1.7      2.0      2.3         23.4         10.3
Non-GHG impacts................................................   0.0 to   0.2 to   0.7 to   2.7 to   4.1 to   5.0 to   6.0 to      58.8 to      22.1 to
                                                                     0.0      0.5      1.8      6.8     10.1     12.5     15.0        132.0         49.7
GHG: \b\ \c\
    SC-GHG; 5% Avg.............................................      0.0      0.1      0.4      1.7      2.8      3.9      5.8         25.1         25.1
    SC-GHG; 3% Avg.............................................      0.0      0.3      1.4      5.2      8.4     11.1     15.2        115.4        115.4
    SC-GHG; 2.5% Avg...........................................      0.0      0.4      2.0      7.5     11.9     15.5     20.9        183.1        183.1
    SC-GHG; 3% 95th............................................      0.1      0.9      4.1     15.6     25.5     33.6     46.6        351.0        351.0

[[Page 73896]]

 
Net benefits:
    SC-GHG; 5% Avg.............................................     -0.1     -0.6      4.3     26.7     46.6     64.3     78.2        606.2        253.8
    SC-GHG; 3% Avg.............................................     -0.1     -0.4      5.2     30.2     52.2     71.4     87.6        696.4        344.0
    SC-GHG; 2.5% Avg...........................................     -0.1     -0.3      5.9     32.6     55.7     75.8     93.3        764.2        411.8
    SC-GHG; 3% 95th............................................      0.0      0.2      8.0     40.7     69.4     94.0    119.0        932.1        579.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ Positive values denote decreased social costs (benefits); negative values denote increased social costs. For an explanation of analytical Methods A
  and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.
\b\ GHG benefit estimates include reductions in CO[ihel2], CH[ihel4], and N[ihel2]O but do not include the HFC reductions, as discussed in Section IX.G.
  Net present value of reduced GHG emissions is calculated differently than other benefits. The same discount rate used to discount the value of damages
  from future emissions (SC-CO[ihel2], SC-CH[ihel4], and SC-N[ihel2]O, each discounted at rates of 5, 3, 2.5 percent) is used to calculate net present
  value of SC-CO[ihel2], SC-CH[ihel4], and SC-N[ihel2]O, respectively, for internal consistency. Refer to the SC-CO[ihel2] TSD for more detail.
\c\ Section IX.G notes that SC-GHGs increases over time. For the years 2012-2050, the SC-CO[ihel2] estimates range as follows: For Average SC-CO[ihel2]
  at 5%: $12-$28; for Average SC-CO[ihel2] at 3%: $37-$77; for Average SC-CO[ihel2] at 2.5%: $58-$105; and for 95th percentile SC-CO[ihel2] at 3%: $105-
  $237. For the years 2012-2050, the SC-CH4 estimates range as follows: For Average SC-CH[ihel4] at 5%: $440-$1,400; for Average SC-CH[ihel4] at 3%:
  $1,000-$2,700; for Average SC-CH[ihel4] at 2.5%: $1,400-$3,400; and for 95th percentile SC-CH[ihel4] at 3%: $2,800-$7,400. For the years 2012-2050,
  the SC-N[ihel2]O estimates range as follows: For Average SC-N[ihel2]O at 5%: $4,000-$12,000; for Average SC-N[ihel2]O at 3%: $14,000-$30,000; for
  Average SC-N[ihel2]O at 2.5%: $21,000-$41,000; and for 95th percentile SC-N[ihel2]O at 3%: $36,000-$79,000. Section IX.G also presents these SC-GHG
  estimates.


           Table IX-31--Discounted Model Year Lifetime Benefits & Costs of the Final Program Using Method B and Relative to the Flat Baseline
                                                        [Billions of 2013$ discounted at 3%] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                     2018     2019     2020     2021     2022     2023     2024     2025     2026     2027     2028     2029      Sum
--------------------------------------------------------------------------------------------------------------------------------------------------------
Vehicle program..................    -$0.2    -$0.2    -$0.2    -$2.1    -$2.0    -$2.1    -$3.1    -$3.0    -$3.0    -$3.6    -$3.5    -$3.4     -$26.5
Maintenance......................    -0.01    -0.01    -0.01    -0.15    -0.16    -0.16    -0.18    -0.18    -0.17    -0.30    -0.29    -0.29       -1.9
Pre-tax fuel.....................      0.7      0.7      0.6     10.7     11.4     12.0     18.5     19.1     19.7     25.3     25.2     25.1      169.1
Energy security..................      0.0      0.0      0.0      0.5      0.5      0.6      0.8      0.9      0.9      1.2      1.2      1.2        7.8
Crashes/Congestion/Noise.........     -0.1     -0.1     -0.2     -0.3     -0.3     -0.3     -0.3     -0.3     -0.3     -0.3     -0.3     -0.3       -3.2
Refueling........................      0.0      0.0      0.0      0.2      0.3      0.3      0.4      0.5      0.5      0.6      0.6      0.6        4.0
Travel value.....................      0.5      0.5      0.6      1.1      1.0      1.0      1.0      1.0      1.0      1.0      0.9      0.9       10.5
Non-GHG..........................   0.1 to   0.1 to   0.1 to   1.4 to   1.4 to   1.5 to   2.3 to   2.3 to   2.2 to   2.8 to   2.7 to   2.7 to    19.6 to
                                       0.3      0.2      0.2      3.2      3.2      3.3      5.2      5.3      4.8      6.2      6.1      6.0       44.1
GHG: \b\ \c\
    SC-GHG; 5% Avg...............      0.0      0.0      0.0      0.6      0.6      0.6      1.0      1.0      1.0      1.3      1.2      1.2        8.6
    SC-GHG; 3% Avg...............      0.2      0.1      0.1      2.4      2.6      2.7      4.1      4.2      4.3      5.5      5.5      5.5       37.2
    SC-GHG; 2.5% Avg.............      0.2      0.2      0.2      3.7      4.0      4.2      6.4      6.6      6.8      8.7      8.6      8.6       58.3
    SC-GHG; 3% 95th..............      0.5      0.4      0.4      7.2      7.7      8.0     12.3     12.7     13.1     16.8     16.7     16.6      112.5
Net benefits:
    SC-GHG; 5% Avg...............      1.1      1.1      1.1     12.8     13.7     14.3     21.8     22.7     23.1     29.6     29.5     29.5      200.2
    SC-GHG; 3% Avg...............      1.2      1.2      1.2     14.6     15.6     16.3     24.9     26.0     26.4     33.9     33.8     33.7      228.8
    SC-GHG; 2.5% Avg.............      1.3      1.3      1.3     16.0     17.1     17.8     27.2     28.4     28.9     37.0     36.9     36.9      249.9
    SC-GHG; 3% 95th..............      1.5      1.5      1.5     19.5     20.8     21.7     33.2     34.5     35.2     45.1     44.9     44.9      304.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ Positive values denote decreased social costs (benefits); negative values denote increased social costs. For an explanation of analytical Methods A
  and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.c
\b\ GHG benefit estimates include reductions in CO[ihel2], CH[ihel4], and N[ihel2]O but do not include the HFC reductions, as discussed in Section IX.G.
  Net present value of reduced GHG emissions is calculated differently than other benefits. The same discount rate used to discount the value of damages
  from future emissions (SC-CO[ihel2], SC-CH[ihel4], and SC-N[ihel2]O, each discounted at rates of 5, 3, 2.5 percent) is used to calculate net present
  value of SC-CO[ihel2], SC-CH[ihel4], and SC-N[ihel2]O, respectively, for internal consistency. Refer to the SC-CO[ihel2] TSD for more detail.
\c\ Section IX.G notes that SC-GHG increases over time. For the years 2012-2050, the SC-CO[ihel2] estimates range as follows: For Average SC-CO[ihel2]
  at 5%: $12-$28; for Average SC-CO[ihel2] at 3%: $37-$77; for Average SC-CO[ihel2] at 2.5%: $58-$105; and for 95th percentile SC-CO[ihel2] at 3%: $105-
  $237. For the years 2012-2050, the SC-CH4 estimates range as follows: For Average SC-CH[ihel4] at 5%: $440-$1,400; for Average SC-CH[ihel4] at 3%:
  $1,000-$2,700; for Average SC-CH[ihel4] at 2.5%: $1,400-$3,400; and for 95th percentile SC-CH[ihel4] at 3%: $2,800-$7,400. For the years 2012-2050,
  the SC-N[ihel2]O estimates range as follows: For Average SC-N[ihel2]O at 5%: $4,000-$12,000; for Average SC-N[ihel2]O at 3%: $14,000-$30,000; for
  Average SC-N[ihel2]O at 2.5%: $21,000-$41,000; and for 95th percentile SC-N[ihel2]O at 3%: $36,000-$79,000. Section IX.G also presents these SC-GHG
  estimates.


           Table IX-32--Discounted Model Year Lifetime Benefits & Costs of the Final Program Using Method B and Relative to the Flat Baseline
                                                      [Billions of 2013$ discounted at 7%] \a\ \b\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   2018     2019     2020     2021     2022     2023     2024     2025     2026     2027     2028     2029       Sum
--------------------------------------------------------------------------------------------------------------------------------------------------------
Vehicle program................    -$0.2    -$0.2    -$0.2    -$1.6    -$1.5    -$1.5    -$2.2    -$2.0    -$1.9    -$2.2    -$2.1    -$2.0       -$17.6
Maintenance....................     0.00     0.00     0.00    -0.10    -0.09    -0.09    -0.10    -0.10    -0.09    -0.15    -0.14    -0.13         -1.0
Pre-tax fuel...................      0.5      0.4      0.4      6.6      6.7      6.8     10.1     10.1     10.0     12.4     11.9     11.4         87.2
Energy security................      0.0      0.0      0.0      0.3      0.3      0.3      0.5      0.5      0.5      0.6      0.6      0.5          4.0
Crashes/Congestion/Noise.......     -0.1     -0.1     -0.1     -0.2     -0.2     -0.2     -0.2     -0.2     -0.2     -0.1     -0.1     -0.1         -1.8
Refueling......................      0.0      0.0      0.0      0.1      0.2      0.2      0.2      0.2      0.3      0.3      0.3      0.3          2.1
Travel value...................      0.3      0.3      0.4      0.6      0.6      0.6      0.5      0.5      0.5      0.5      0.4      0.4          5.7
Non-GHG........................   0.1 to   0.1 to   0.1 to   0.8 to   0.8 to   0.8 to   1.1 to   1.1 to   1.0 to   1.2 to   1.2 to   1.1 to       9.2 to
                                     0.2      0.1      0.1      1.8      1.7      1.7      2.6      2.5      2.2      2.7      2.6      2.5         20.8
GHG: \b\ \c\
    SC-GHG; 5% Avg.............      0.0      0.0      0.0      0.6      0.6      0.6      1.0      1.0      1.0      1.3      1.2      1.2          8.6
    SC-GHG; 3% Avg.............      0.2      0.1      0.1      2.4      2.6      2.7      4.1      4.2      4.3      5.5      5.5      5.5         37.2
    SC-GHG; 2.5% Avg...........      0.2      0.2      0.2      3.7      4.0      4.2      6.4      6.6      6.8      8.7      8.6      8.6         58.3
    SC-GHG; 3% 95th............      0.5      0.4      0.4      7.2      7.7      8.0     12.3     12.7     13.1     16.8     16.7     16.6        112.5
Net benefits:
    SC-GHG; 5% Avg.............      0.7      0.7      0.6      7.6      7.9      7.9     11.7     11.8     11.6     14.4     13.9     13.5        102.3
    SC-GHG; 3% Avg.............      0.8      0.8      0.8      9.4      9.8     10.0     14.8     15.1     15.0     18.7     18.2     17.7        130.9
    SC-GHG; 2.5% Avg...........      0.9      0.9      0.8     10.7     11.2     11.4     17.1     17.4     17.4     21.9     21.3     20.9        151.9
    SC-GHG; 3% 95th............      1.1      1.1      1.0     14.2     14.9     15.3     23.0     23.6     23.7     29.9     29.3     28.9        206.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:

[[Page 73897]]

 
\a\ Positive values denote decreased social costs (benefits); negative values denote increased social costs. For an explanation of analytical Methods A
  and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.
\b\ GHG benefit estimates include reductions in CO[ihel2], CH4, and N[ihel2]O but do not include the HFC reductions, as discussed in Section IX.G. Net
  present value of reduced GHG emissions is calculated differently than other benefits. The same discount rate used to discount the value of damages
  from future emissions (SC-CO[ihel2], SC-CH4, and SC-N[ihel2]O, each discounted at rates of 5, 3, 2.5 percent) is used to calculate net present value
  of SC-CO[ihel2], SC-CH4, and SC-N[ihel2]O, respectively, for internal consistency. Refer to the SC-CO[ihel2] TSD for more detail.
\c\ Section IX.G notes that SC-GHG increases over time. For the years 2012-2050, the SC-CO[ihel2] estimates range as follows: For Average SC-CO[ihel2]
  at 5%: $12-$28; for Average SC-CO[ihel2] at 3%: $37-$77; for Average SC-CO[ihel2] at 2.5%: $58-$105; and for 95th percentile SCCO[ihel2] at 3%: $105-
  $237. For the years 2012-2050, the SC-CH4 estimates range as follows: For Average SC-CH4 at 5%: $440-$1,400; for Average SC-CH4 at 3%: $1,000-$2,700;
  for Average SC-CH4 at 2.5%: $1,400-$3,400; and for 95th percentile SC-CH4 at 3%: $2,800-$7,400. For the years 2012-2050, the SC-N[ihel2]O estimates
  range as follows: For Average SC-N[ihel2]O at 5%: $4,000-$12,000; for Average SC-N[ihel2]O at 3%: $14,000-$30,000; for Average SC-N[ihel2]O at 2.5%:
  $21,000-$41,000; and for 95th percentile SC-N[ihel2]O at 3%: $36,000-$79,000. Section IX.G also presents these SC-GHG estimates.

L. Employment Impacts

    Executive Order 13563 (January 18, 2011) directs federal agencies 
to consider regulatory impacts on, among other criteria, job 
creation.\902\ According to the Executive Order ``Our regulatory system 
must protect public health, welfare, safety, and our environment while 
promoting economic growth, innovation, competitiveness, and job 
creation. It must be based on the best available science.'' Analysis of 
employment impacts of a regulation is not part of a standard benefit-
cost analysis (except to the extent that labor costs contribute to 
costs). Employment impacts of federal rules are of general interest, 
however, and have been particularly so, historically, in the auto 
sector during periods of challenging labor market conditions. For this 
reason, we are describing the connections of these standards to 
employment in the regulated sector, the motor vehicle manufacturing 
sector, as well as the motor vehicle body and trailer and motor vehicle 
parts manufacturing sectors.\903\
---------------------------------------------------------------------------

    \902\ Available at http://www.whitehouse.gov/sites/default/files/omb/inforeg/eo12866/eo13563_01182011.pdf.
    \903\ The employment analysis in this RIA is part of EPA's 
ongoing effort to ``conduct continuing evaluations of potential loss 
or shifts of employment which may result from the administration or 
enforcement of [the Act]'' pursuant to CAA section 321(a).
---------------------------------------------------------------------------

    The overall effect of the final rules on motor vehicle sector 
employment depends on the relative magnitude of output and substitution 
effects, described below. Because we do not have quantitative estimates 
of the output effect, and only a partial estimate of the substitution 
effect, we cannot reach a quantitative estimate of the overall 
employment effects of the final rules on motor vehicle sector 
employment or even whether the total effect will be positive or 
negative.
    According to the U.S. Bureau of Labor Statistics, in 2015, about 
910,000 people in the U.S. were employed in the Motor Vehicle and Parts 
Manufacturing Sector (NAICS 3361, 3362, and 3363),\904\ the directly 
regulated sector. The employment effects of these final rules are 
expected to expand beyond the regulated sector. Though some of the 
parts used to achieve these standards are likely to be built by motor 
vehicle manufacturers (including trailer manufacturers) themselves, the 
motor vehicle parts manufacturing sector also plays a significant role 
in providing those parts, and will also be affected by changes in 
vehicle sales. Changes in truck sales, discussed in Section IX.F.(2), 
could also affect employment for truck and trailer vendors. As 
discussed in Section IX.C., this final rule is expected to reduce the 
amount of fuel these vehicles use, and thus affect the petroleum 
refinery and supply industries as well. Finally, since the net 
reduction in cost associated with these final rules is expected to lead 
to lower transportation and shipping costs, in a competitive market a 
substantial portion of those cost savings will be passed along to 
consumers, who then will have additional discretionary income (how much 
of the cost is passed along to consumers depends on market structure 
and the relative price elasticities). The final rules are not expected 
to have any notable inflationary or recessionary effect.
---------------------------------------------------------------------------

    \904\ U.S. Department of Labor, Bureau of Labor Statistics. 
``Automotive Industry; Employment, Earnings, and Hours.'' http://www.bls.gov/iag/tgs/iagauto.htm, accessed 4/20/16.
---------------------------------------------------------------------------

    The employment effects of environmental regulation are difficult to 
disentangle from other economic changes and business decisions that 
affect employment, over time and across regions and industries. In 
light of these difficulties, we lean on economic theory to provide a 
constructive framework for approaching these assessments and for better 
understanding the inherent complexities in such assessments. 
Neoclassical microeconomic theory describes how profit-maximizing firms 
adjust their use of productive inputs in response to changes in their 
economic conditions.\905\ Berman and Bui (2001, pp. 274-75) model two 
components that drive changes in firm-level labor demand: Output 
effects and substitution effects.\906\ Regulation can affect the 
profit-maximizing quantity of output by changing the marginal cost of 
production. If regulation causes marginal cost to increase, it will 
place upward pressure on output prices, leading to a decrease in the 
quantity demanded, and resulting in a decrease in production. The 
output effect describes how, holding labor intensity constant, a 
decrease in production causes a decrease in labor demand. As noted by 
Berman and Bui, although many assume that regulation increases marginal 
cost, it need not be the case. A regulation could induce a firm to 
upgrade to less polluting and more efficient equipment that lowers 
marginal production costs, or it may induce use of technologies that 
may prove popular with buyers or provide positive network externalities 
(see Section IX.A. for discussion of this effect). In such a case, 
output could increase.
---------------------------------------------------------------------------

    \905\ See Layard, P.R.G., and A. A. Walters (1978), 
Microeconomic Theory (McGraw-Hill, Inc.), Chapter 9 (Docket ID EPA-
HQ-OAR-2014-0827-0070), a standard microeconomic theory textbook 
treatment, for a discussion.
    \906\ Berman, E. and L. T. M. Bui (2001). ``Environmental 
Regulation and Labor Demand: Evidence from the South Coast Air 
Basin.'' Journal of Public Economics 79(2): 265-295 (Docket EPA-HQ-
OAR-2014-0827-0074). The authors also discuss a third component, the 
impact of regulation on factor prices, but conclude that this effect 
is unlikely to be important for large competitive factor markets, 
such as labor and capital. Morgenstern, Pizer and Shih (Morgenstern, 
Richard D., William A. Pizer, and Jhih-Shyang Shih (2002). ``Jobs 
versus the Environment: An Industry-Level Perspective.'' Journal of 
Environmental Economics and Management 43: 412-436, Docket EPA-HQ-
OAR-2014-0827-0088) use a similar model, but they break the 
employment effect into three parts: (1) A demand effect; (2) a cost 
effect; and (3) a factor-shift effect.
---------------------------------------------------------------------------

    The substitution effect describes how, holding output constant, 
regulation affects labor intensity of production. Although increased 
environmental regulation may increase use of pollution control 
equipment and energy to operate that equipment, the impact on labor 
demand is ambiguous. For example, equipment inspection requirements, 
specialized waste handling, or pollution technologies that alter the 
production process may affect the number of workers necessary to 
produce a unit of output. Berman and Bui (2001) model the substitution 
effect as the effect of regulation on pollution control equipment and 
expenditures required

[[Page 73898]]

by the regulation and the corresponding change in labor intensity of 
production.
    In summary, as output and substitution effects may be positive or 
negative, theory alone cannot predict the direction of the net effect 
of regulation on labor demand at the level of the regulated firm. 
Operating within the bounds of standard economic theory, empirical 
estimation of net employment effects on regulated firms is possible 
when data and methods of sufficient detail and quality are available. 
The literature, however, illustrates difficulties with empirical 
estimation. For example, studies sometimes rely on confidential plant-
level employment data from the U.S. Census Bureau, possibly combined 
with pollution abatement expenditure data that are too dated to be 
reliably informative. In addition, the most commonly used empirical 
methods do not permit estimation of net effects.
    The conceptual framework described thus far focused on regulatory 
effects on plant-level decisions within a regulated industry. 
Employment impacts at an individual plant do not necessarily represent 
impacts for the sector as a whole. The approach must be modified when 
applied at the industry level. At the industry level, labor demand is 
more responsive if: (1) The price elasticity of demand for the product 
is high, (2) other factors of production can be easily substituted for 
labor, (3) the supply of other factors is highly elastic, or (4) labor 
costs are a large share of total production costs.\907\ For example, if 
all firms in an industry are faced with the same regulatory compliance 
costs and product demand is inelastic, then industry output may not 
change much, and output of individual firms may change slightly.\908\ 
In this case, the output effect may be small, while the substitution 
effect depends on input substitutability. Suppose, for example, that 
new equipment for fuel efficiency improvements requires labor to 
install and operate. In this case, the substitution effect may be 
positive, and with a small output effect, the total effect may be 
positive. As with potential effects for an individual firm, theory 
cannot determine the sign or magnitude of industry-level regulatory 
effects on labor demand. Determining these signs and magnitudes 
requires additional sector-specific empirical study. For environmental 
rules, much of the data needed for these empirical studies is not 
publicly available, would require significant time and resources in 
order to access confidential U.S. Census data for research, and also 
would not be necessary for other components of a typical RIA.
---------------------------------------------------------------------------

    \907\ See Ehrenberg, Ronald G., and Robert S. Smith (2000), 
Modern Labor Economics: Theory and Public Policy (Addison Wesley 
Longman, Inc.), p. 108, Docket EPA-HQ-OAR-2014-0827-0077.
    \908\ This discussion draws from Berman, E. and L. T. M. Bui 
(2001). ``Environmental Regulation and Labor Demand: Evidence from 
the South Coast Air Basin.'' Journal of Public Economics 79(2): 265-
295 (Docket EPA-HQ-OAR-2014-0827), p. 293, Docket EPA-HQ-OAR-2014-
0827-0074.
---------------------------------------------------------------------------

    In addition to changes to labor demand in the regulated industry, 
net employment impacts encompass changes in other related sectors. For 
example, these standards are expected to increase demand for fuel-
saving technologies. This increased demand may increase revenue and 
employment in the firms providing these technologies. At the same time, 
the regulated industry is purchasing the equipment, and these costs may 
impact labor demand at regulated firms. Therefore, it is important to 
consider the net effect of compliance actions on employment across 
multiple sectors or industries.
    If the U.S. economy is at full employment, even a large-scale 
environmental regulation is unlikely to have a noticeable impact on 
aggregate net employment.\909\ Instead, labor would primarily be 
reallocated from one productive use to another, and net national 
employment effects from environmental regulation would be small and 
transitory (e.g., as workers move from one job to another).\910\ The 
International Union, United Automobile, Aerospace and Agricultural 
Implement Workers of America (UAW) commented that, when the 900,000 
workers in the auto sector are combined with ``jobs from other sectors 
that are dependent on the industry,'' the industry ``is responsible for 
7.25 million jobs nationwide, or about 3.8 percent of private-sector 
employment.'' The agencies consider the 900,000 motor-vehicle-sector 
jobs to be in the industry directly affected by these standards; for 
the reasons discussed here, the overall state of the U.S. economy is 
likely to have a much more significant effect on the people employed in 
other sectors than these standards.
---------------------------------------------------------------------------

    \909\ Full employment is a conceptual target for the economy 
where everyone who wants to work and is available to do so at 
prevailing wages is actively employed. The unemployment rate at full 
employment is not zero.
    \910\ Arrow et al. (1996). ``Benefit-Cost Analysis in 
Environmental, Health, and Safety Regulation: A Statement of 
Principles.'' American Enterprise Institute, the Annapolis Center, 
and Resources for the Future, Docket EPA-HQ-OAR-2014-0827-0073. See 
discussion on bottom of p. 6. In practice, distributional impacts on 
individual workers can be important, as discussed later in this 
section.
---------------------------------------------------------------------------

    Affected sectors may experience transitory effects as workers 
change jobs. Some workers may retrain or relocate in anticipation of 
new requirements or require time to search for new jobs, while 
shortages in some sectors or regions could bid up wages to attract 
workers. These adjustment costs can lead to local labor disruptions. 
Although the net change in the national workforce is expected to be 
small, localized reductions in employment may adversely impact 
individuals and communities just as localized increases may have 
positive impacts.
    If the economy is operating at less than full employment, economic 
theory does not clearly indicate the direction or magnitude of the net 
impact of environmental regulation on employment; it could cause either 
a short-run net increase or short-run net decrease.\911\ An important 
research question is how to accommodate unemployment as a structural 
feature in economic models. This feature may be important in assessing 
large-scale regulatory impacts on employment.\912\
---------------------------------------------------------------------------

    \911\ Schmalensee, Richard, and Robert N. Stavins. ``A Guide to 
Economic and Policy Analysis of EPA's Transport Rule.'' White paper 
commissioned by Excelon Corporation, March 2011, Docket EPA-HQ-OAR-
2014-0827-0071.
    \912\ Klaiber, H. Allen, and V. Kerry Smith (2012). ``Developing 
General Equilibrium Benefit Analyses for Social Programs: An 
Introduction and Example.'' Journal of Benefit-Cost Analysis 3(2), 
Docket EPA-HQ-OAR-2014-0827-0086.
---------------------------------------------------------------------------

    Environmental regulation may also affect labor supply. In 
particular, pollution and other environmental risks may impact labor 
productivity or employees' ability to work.\913\ While the theoretical 
framework for analyzing labor supply effects is analogous to that for 
labor demand, it is more difficult to study empirically. There is a 
small emerging literature described in the next section that uses 
detailed labor and environmental data to assess these impacts.
---------------------------------------------------------------------------

    \913\ E.g. Graff Zivin, J., and M. Neidell (2012). ``The Impact 
of Pollution on Worker Productivity.'' American Economic Review 102: 
3652-3673, Docket EPA-HQ-OAR-2014-0827-0092.
---------------------------------------------------------------------------

    To summarize, economic theory provides a framework for analyzing 
the impacts of environmental regulation on employment. The net 
employment effect incorporates expected employment changes (both 
positive and negative) in the regulated sector and elsewhere. Labor 
demand impacts for regulated firms, and also for the regulated 
industry, can be decomposed into output and substitution effects which 
may be either negative or positive. Estimation of net employment 
effects for regulated sectors is possible when data of sufficient 
detail and quality are

[[Page 73899]]

available. Finally, economic theory suggests that labor supply effects 
are also possible. In the next section, we discuss the empirical 
literature.
    Achates Power, the American Council for an Energy-Efficient 
Economy, BlueGreen Alliance, Ceres, Environmental Defense Fund (EDF), 
Natural Resources Defense Council, and JD Gilroy expressed support for 
the standards' potential to increase employment in the vehicle 
manufacturing industry. They argued that the standards will drive new 
jobs, reward organizations that innovate with respect to fuel 
efficiency, and help maintain the U.S. position as a leader in 
industries related to truck manufacturing and fuel efficiency 
technology. Brian Mannix points out the difficulty associated with 
generating complete employment forecasts that include all direct and 
indirect effects. He concludes that the agencies are correct to be 
careful about estimating a definitive forecast.
    Comments from the International Union, United Automobile, Aerospace 
and Agricultural Implement Workers of America (UAW) urge EPA and NHTSA 
to ensure that the standards avoid market disruptions or ``pre-buy/no-
buy'' boom and bust cycles. UAW suggests that in the past, market 
disruptions caused by pre-buy in anticipation of the 2007 and 2010 
NOX and PM standards contributed to the layoff of 10,000 UAW 
workers in 2009, though these layoffs were also partly driven by the 
Great Recession. As pointed out in the comments from EDF, fuel economy 
standards are fundamentally different from the past standards, because 
increases in costs for new technology are offset by fuel savings that 
accrue to the buyer. As a result these standards are less likely to 
cause disruptions to vehicle purchasing trends. Moreover, as discussed 
in Section IX.F.(2) above, there is no evidence to date that the HD 
GHG/fuel consumption rules have resulted in pre-buy/no-buys.
    NAFA Fleet Management Association expressed concern that the 
standards would make it more difficult to hire qualified drivers and 
technicians, and would require additional employee training. As 
discussed in Section IX.A., the effects of the standards on hiring and 
retention of drivers and technicians are not well understood. The 
agencies expect that normal market forces should help to alleviate any 
labor shortages, whether or not they are associated with the standards. 
The Recreational Vehicle (RV) Industry Association expresses concern 
that buyers RVs do not consider fuel expenditures when purchasing 
vehicles; as a result, increased up-front costs of the vehicle might 
reduce their sales. The RV industry was disproportionately hurt during 
the Great Recession and has only recently experienced a 
recovery.914 915 However, one of the main drivers of the 
turn-around appears to be low gas prices,\916\ which suggests that RV 
buyers may put some weight on fuel savings in their buying decisions; 
if so, the reduction in expected fuel costs may mitigate at least some 
of the effect of higher up-front prices.
---------------------------------------------------------------------------

    \914\ Quiggle, Ben. ``RV sales projected to be stronger in 2016 
thanks to low gas prices, steady economy,'' The Elkhart Truth, March 
6, 2016. http://www.elkharttruth.com/news/business/2016/03/03/RV-sales-projected-to-be-stronger-in-2016-thanks-to-low-gas-prices-steady-economy.html, accessed 3/28/2016, Docket EPA-HQ-OAR-2014-
0827.
    \915\ Morris, Frank. ``Ready For A Road Trip? RVs Are Rolling 
Back Into Fashion,'' Morning Edition on NPR, March 28, 2016. http://www.npr.org/2016/03/28/468172578/ready-for-a-road-trip-rvs-are-rolling-back-into-fashion, accessed 3/28/2016, Docket EPA-HQ-OAR-
2014-0827.
    \916\ Quiggle, Ben. ``RV sales projected to be stronger in 2016 
thanks to low gas prices, steady economy,'' The Elkhart Truth, March 
6, 2016. http://www.elkharttruth.com/news/business/2016/03/03/RV-sales-projected-to-be-stronger-in-2016-thanks-to-low-gas-prices-steady-economy.html, accessed 3/28/2016, Docket EPA-HQ-OAR-2014-
0827.
---------------------------------------------------------------------------

(1) Current State of Knowledge Based on the Peer-Reviewed Literature
    In the labor economics literature there is an extensive body of 
peer-reviewed empirical work analyzing various aspects of labor demand, 
relying on the above theoretical framework.\917\ This work focuses 
primarily on the effects of employment policies, e.g. labor taxes, 
minimum wage, etc.\918\ In contrast, the peer-reviewed empirical 
literature specifically estimating employment effects of environmental 
regulations is very limited. Several empirical studies \919\ suggest 
that net employment impacts may be zero or slightly positive but small 
even in the regulated sector. Other research suggests that more highly 
regulated counties may generate fewer jobs than less regulated 
ones.\920\ However, since these latter studies compare more regulated 
to less regulated counties, they overstate the net national impact of 
regulation to the extent that regulation causes plants to locate in one 
area of the country rather than another. List et al. (2003) \921\ find 
some evidence that this type of geographic relocation may be occurring. 
Overall, the peer-reviewed literature does not contain evidence that 
environmental regulation has a large impact on net employment (either 
negative or positive) in the long run across the whole economy.
---------------------------------------------------------------------------

    \917\ See Hamermesh (1993), Labor Demand (Princeton, NJ: 
Princeton University Press), Chapter 2 (Docket EPA-HQ-OAR-2014-0827-
0082) for a detailed treatment.
    \918\ See Ehrenberg, Ronald G., and Robert S. Smith (2000), 
Modern Labor Economics: Theory and Public Policy (Addison Wesley 
Longman, Inc.), Chapter 4 (Docket EPA-HQ-OAR-2014-0827-0077), for a 
concise overview.
    \919\ Berman, E. and L. T. M. Bui (2001). ``Environmental 
Regulation and Labor Demand: Evidence from the South Coast Air 
Basin.'' Journal of Public Economics 79(2): 265-295 (Docket EPA-HQ-
OAR2014-0827-0074). Morgenstern, Richard D., William A. Pizer, and 
Jhih-Shyang Shih. ``Jobs Versus the Environment: An Industry-Level 
Perspective.'' Journal of Environmental Economics and Management 43 
(2002): 412-436, Docket EPA-HQ-OAR-2014-0827-0088; Gray et al. 
(2014), ``Do EPA Regulations Affect Labor Demand? Evidence from the 
Pulp and Paper Industry,'' Journal of Environmental Economics and 
Management 68: 188-202, Docket EPA-HQ-OAR-2014-0827-0080; and 
Ferris, Shadbegian and Wolverton (2014), ``The Effect of 
Environmental Regulation on Power Sector Employment: Phase I of the 
Title IV SO2 Trading Program,'' Journal of the 
Association of Environmental and Resource Economists 1: 521-553, 
Docket EPA-HQ-OAR-2014-0827-0078.
    \920\ Greenstone, M. (2002). ``The Impacts of Environmental 
Regulations on Industrial Activity: Evidence from the 1970 and 1977 
Clean Air Act Amendments and the Census of Manufactures,'' Journal 
of Political Economy 110(6): 1175-1219 (Docket EPA-HQ-OAR-2014-0827-
0081); Walker, Reed. (2011). ``Environmental Regulation and Labor 
Reallocation.'' American Economic Review: Papers and Proceedings 
101(3): 442-447 (Docket EPA-HQ-OAR-2014-0827-0091).
    \921\ List, J. A., D. L. Millimet, P. G. Fredriksson, and W. W. 
McHone (2003). ``Effects of Environmental Regulations on 
Manufacturing Plant Births: Evidence from a Propensity Score 
Matching Estimator.'' The Review of Economics and Statistics 85(4): 
944-952 (Docket EPA-HQ-OAR2014-0827-0087).
---------------------------------------------------------------------------

    Analytic challenges make it very difficult to accurately produce 
net employment estimates for the whole economy that would appropriately 
capture the way in which costs, compliance spending, and environmental 
benefits propagate through the macro-economy. Quantitative estimates 
are further complicated by the fact that macroeconomic models often 
have very little sectoral detail and usually assume that the economy is 
at full employment. EPA is currently in the process of seeking input 
from an independent expert panel on modeling economy-wide impacts, 
including employment effects. For more information, see: https://federalregister.gov/a/2014-02471.
(2) Employment Impacts in the Motor Vehicle and Parts Manufacturing 
Sector
    This section describes changes in employment in the motor vehicle, 
trailer, and parts (hence, motor vehicle) manufacturing sectors due to 
these final rules. We focus on the motor vehicle manufacturing sector 
because it is directly regulated, and because it is likely to bear a 
substantial share of

[[Page 73900]]

changes in employment due to these final rules. We include discussion 
of effects on the parts manufacturing sector, because the motor vehicle 
manufacturing sector can either produce parts internally or buy them 
from an external supplier, and we do not have estimates of the likely 
breakdown of effort between the two sectors.
    We follow the theoretical structure of Berman and Bui \922\ of the 
impacts of regulation in employment in the regulated sectors. In Berman 
and Bui's (2001, p. 274-75) theoretical model, as described above, the 
change in a firm's labor demand arising from a change in regulation is 
decomposed into two main components: Output and substitution 
effects.\923\ As the output and substitution effects may be both 
positive, both negative, or some combination, standard neoclassical 
theory alone does not point to a definitive net effect of regulation on 
labor demand at regulated firms.
---------------------------------------------------------------------------

    \922\ Berman, E. and L. T. M. Bui (2001). ``Environmental 
Regulation and Labor Demand: Evidence from the South Coast Air 
Basin.'' Journal of Public Economics 79(2): 265-295 (Docket EPA-HQ-
OAR2014-0827-0074).
    \923\ The authors also discuss a third component, the impact of 
regulation on factor prices, but conclude that this effect is 
unlikely to be important for large competitive factor markets, such 
as labor and capital. Morgenstern, Pizer and Shih (2002) use a 
similar model, but they break the employment effect into three 
parts: (1) The demand effect; (2) the cost effect; and (3) the 
factor-shift effect. See Morgenstern, Richard D., William A. Pizer, 
and Jhih-Shyang Shih. ``Jobs Versus the Environment: An Industry-
Level Perspective.'' Journal of Environmental Economics and 
Management 43 (2002): 412-436 (Docket EPA-HQ-OAR-2014-0827-0088).
---------------------------------------------------------------------------

    Following the Berman and Bui framework for the impacts of 
regulation on employment in the regulated sector, we consider two 
effects for the motor vehicle sector: The output effect and the 
substitution effect.
(a) The Output Effect
    If truck or trailer sales increase, then more people will be 
required to assemble trucks, trailers, and their components. If truck 
or trailer sales decrease, employment associated with these activities 
will decrease. The effects of this final rulemaking on HD vehicle sales 
thus depend on the perceived desirability of the new vehicles. On one 
hand, this final rulemaking will increase truck and trailer costs; by 
itself, this effect would reduce truck and trailer sales. In addition, 
while decreases in truck performance would also decrease sales, this 
program is not expected to have any negative effect on truck 
performance. On the other hand, this final rulemaking will reduce the 
fuel costs of operating the trucks; by itself, this effect would 
increase truck sales, especially if potential buyers have an 
expectation of higher fuel prices. The agencies have not made an 
estimate of the potential change in truck or trailer sales. However, as 
discussed in IX.E., the agencies have estimated an increase in vehicle 
miles traveled (i.e., VMT rebound) due to the reduced operating costs 
of trucks meeting these standards. Since increased VMT is most likely 
to be met with more drivers and more trucks, our projection of VMT 
rebound is suggestive of an increase in vehicle sales and truck driver 
employment (recognizing that these increases may be partially offset by 
a decrease in manufacturing and sales for equipment of other modes of 
transportation such as rail cars or barges).
(b) The Substitution Effect
    The output effect, above, measures the effect due to new truck and 
trailer sales only. The substitution effect includes the impacts due to 
the changes in technologies needed for vehicles to meet these 
standards, separate from the effect on output (that is, as though 
holding output constant). This effect includes both changes in 
employment due to incorporation of abatement technologies and overall 
changes in the labor intensity of manufacturing. We present estimates 
for this effect to provide a sense of the order of magnitude of 
expected impacts on employment, which we expect to be small in the 
automotive sector, and to repeat that regulations may have positive as 
well as negative effects on employment.
    One way to estimate this effect, given the cost estimates for 
complying with the final rule, is to use the ratio of workers to each 
$1 million of expenditures in that sector. The use of these ratios has 
both advantages and limitations. It is often possible to estimate these 
ratios for quite specific sectors of the economy: For instance, it is 
possible to estimate the average number of workers in the motor vehicle 
body and trailer manufacturing sector per $1 million spent in the 
sector, rather than use the ratio from another, more aggregated sector, 
such as motor vehicle manufacturing. As a result, it is not necessary 
to extrapolate employment ratios from possibly unrelated sectors. On 
the other hand, these estimates are averages for the sectors, covering 
all the activities in those sectors; they may not be representative of 
the labor required when expenditures are required on specific 
activities, or when manufacturing processes change sufficiently that 
labor intensity changes. For instance, the ratio for the motor vehicle 
manufacturing sector represents the ratio for all vehicle 
manufacturing, not just for emissions reductions associated with 
compliance activities. In addition, these estimates do not include 
changes in sectors that supply these sectors, such as steel or 
electronics producers. They thus may best be viewed as the effects on 
employment in the motor vehicle sector due to the changes in 
expenditures in that sector, rather than as an assessment of all 
employment changes due to these changes in expenditures. In addition, 
this approach estimates the effects of increased expenditures while 
holding constant the labor intensity of manufacturing; it does not take 
into account changes in labor intensity due to changes in the nature of 
production. This latter effect could either increase or decrease the 
employment impacts estimated here.\924\
---------------------------------------------------------------------------

    \924\ As noted above, Morgenstern et al. (2002) separate the 
effect of holding output constant into two effects: The cost effect, 
which holds labor intensity constant, and the factor shift effect, 
which estimates those changes in labor intensity.
---------------------------------------------------------------------------

    Some of the costs of these final rules will be spent directly in 
the motor vehicle manufacturing sector, but it is also likely that some 
of the costs will be spent in the motor vehicle body and trailer and 
motor vehicle parts manufacturing sectors. The analysis here draws on 
estimates of workers per $1 million of expenditures for each of these 
sectors.
    There are several public sources for estimates of employment per $1 
million expenditures. The U.S. Bureau of Labor Statistics (BLS) 
provides its Employment Requirements Matrix (ERM),\925\ which provides 
direct estimates of the employment per $1 million in sales of goods in 
202 sectors. The values considered here are for Motor Vehicle 
Manufacturing (NAICS 3361), Motor Vehicle Body and Trailer 
Manufacturing (NAICS 3362), and Motor Vehicle Parts Manufacturing 
(NAICS 3363) for 2014.
---------------------------------------------------------------------------

    \925\ http://www.bls.gov/emp/ep_data_emp_requirements.htm; see 
``HD Substitution Effect Employment Impacts,'' Docket EPA-HQ-OAR-
2014-0827.
---------------------------------------------------------------------------

    The Census Bureau provides the Annual Survey of Manufacturers \926\ 
(ASM), a subset of the Economic Census (EC), based on a sample of 
establishments; though the EC itself is more complete, it is conducted 
only every 5 years, while the ASM is annual. Both include more sectoral 
detail than the BLS ERM: For instance, while the ERM includes the Motor 
Vehicle

[[Page 73901]]

Manufacturing sector, the ASM and EC have detail at the 6-digit NAICS 
code level (e.g., light truck and utility vehicle manufacturing). While 
the ERM provides direct estimates of employees/$1 million in 
expenditures, the ASM and EC separately provide number of employees and 
value of shipments; the direct employment estimates here are the ratio 
of those values. The values reported are for Motor Vehicle 
Manufacturing (NAICS 3361), Light Truck and Utility Vehicle 
Manufacturing (NAICS 336112), Heavy Duty Truck Manufacturing (NAICS 
33612), Motor Vehicle Body and Trailer manufacturing (NAICS 3362), and 
Motor Vehicle Parts Manufacturing (NAICS 3363).
---------------------------------------------------------------------------

    \926\ http://www.census.gov/manufacturing/asm/index.html; see 
``HD Substitution Effect Employment Impacts,'' Docket EPA-HQ-OAR-
2014-0827.
---------------------------------------------------------------------------

    RIA Chapter 8.11.2.2 provides the details on the values of workers 
per $1 million in expenditures in 2014 (2012 for EC) for the sectors 
mentioned above. In 2013$, these range from 0.4 workers per $1 million 
for Motor Vehicle Manufacturing in the ERM as well as for Light Truck & 
Utility Vehicle Manufacturing in the ASM, to 3.5 workers per $1 million 
in expenditures for Motor Vehicle Body and Trailer Manufacturing in the 
EC. These values are then adjusted to remove the employment effects of 
imports through use of a ratio of domestic production to domestic sales 
of 0.78.\927\
---------------------------------------------------------------------------

    \927\ To estimate the proportion of domestic production affected 
by the change in sales, we use data from Ward's Automotive Group for 
total truck production in the U.S. compared to total truck sales in 
the U.S. For the period 2006-2015, the proportion is 78 percent (HD 
Substitution Effect Employment Impacts, Docket EPA-HQ-OAR-2014-
0827), ranging from 68 percent (2009) to 83 percent (2012) over that 
time.
---------------------------------------------------------------------------

    Over time, the amount of labor needed in the motor vehicle industry 
has changed: Automation and improved methods have led to significant 
productivity increases. The BLS ERM, for instance, provided estimates 
that, in 1997, 1.09 workers in the Motor Vehicle Manufacturing sector 
were needed per $1 million, but only 0.39 workers by 2014 (in 
2013$).\928\ Because the ERM is available annually for 1997-2014, we 
used these data to estimate productivity improvements over time. We 
then used these productivity estimates to project the ERM through 2027, 
and to adjust the ASM values for 2014 and the EC values for 2012. RIA 
Chapter 8.11.2 provides detail on these calculations.
---------------------------------------------------------------------------

    \928\ http://www.bls.gov/emp/ep_data_emp_requirements.htm; see 
``HD Substitution Effect Employment Impacts,'' Docket EPA-HQ-OAR-
2014-0827. This analysis used data for sectors 80 (Motor Vehicle 
Manufacturing), 81 (Motor Vehicle Body and Trailer Manufacturing), 
and 82 (Motor Vehicle Parts Manufacturing) from ``Chain-weighted 
(2009 dollars) real domestic employment requirements tables.''
---------------------------------------------------------------------------

    Finally, to simplify the presentation and give a range of 
estimates, we compared the projected employment among the 3 sectors for 
the ERM, EC, and ASM, and we provide only the maximum and minimum 
employment effects estimated across the ERM, EC, and ASM. We provide 
the range rather than a point estimate because of the inherent 
difficulties in estimating employment impacts; the range gives an 
estimate of the expected magnitude. The ERM estimates in the Motor 
Vehicle Manufacturing Sector are consistently the minimum values. The 
ASM estimates in the Motor Vehicle Body and Trailer Manufacturing 
Sector are the maximum values for all years but 2027, when the ASM 
values for Motor Vehicle Parts Manufacturing provide the maximum 
values.
    Section IX.B. of the Preamble discusses the vehicle cost estimates 
developed for these final rules. The final step in estimating 
employment impacts is to multiply costs (in $ millions) by workers per 
$1 million in costs, to estimate employment impacts in the regulated 
and parts manufacturing sectors. Increased costs of vehicles and parts 
will, by itself, and holding labor intensity constant, be expected to 
increase employment between 2018 and 2027 between zero and 4.5 thousand 
jobs each year.
    While we estimate employment impacts, measured in job-years, 
beginning with program implementation, some of these employment gains 
may occur earlier as motor vehicle manufacturers and parts suppliers 
hire staff in anticipation of compliance with the standards. A job-year 
is a way to calculate the amount of work needed to complete a specific 
task. For example, a job-year is one year of work for one person.

Table IX-33--Employment Effects Due to Increased Costs of Vehicles and Parts (Substitution Effect), in Job-Years
----------------------------------------------------------------------------------------------------------------
                                                         Minimum employment due  to   Maximum employment due  to
                                                         substitution effect  (ERM    substitution effect  (ASM
                Year                  Costs  (millions  estimates,  expenditures in  estimates,  expenditures in
                                         of 2013$)        the Motor  Vehicles Mfg     the Body  and Trailer Mfg
                                                                  sector)                    sector \a\)
----------------------------------------------------------------------------------------------------------------
2018...............................                227                            0                          400
2019...............................                215                            0                          400
2020...............................                220                            0                          300
2021...............................              2,270                          300                        3,100
2022...............................              2,243                          300                        2,900
2023...............................              2,485                          300                        2,900
2024...............................              3,890                          400                        4,200
2025...............................              4,146                          400                        4,100
2026...............................              4,203                          400                        3,800
2027...............................              5,219                          500                        4,500
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For 2027, the maximum employment effects are associated with the ASM's Motor Vehicle Parts Manufacturing
  sector.

(c) Summary of Employment Effects in the Motor Vehicle Sector
    The overall effect of these final rules on motor vehicle sector 
employment depends on the relative magnitude of the output effect and 
the substitution effect. Because we do not have quantitative estimates 
of the output effect, and only a partial estimate of the substitution 
effect, we cannot reach a quantitative estimate of the overall 
employment effects of these final rules on motor vehicle sector 
employment or even whether the total effect will be positive or 
negative.
    These standards are not expected to provide incentives for 
manufacturers to shift employment between domestic and

[[Page 73902]]

foreign production. This is because these standards will apply to 
vehicles sold in the U.S. regardless of where they are produced. If 
foreign manufacturers already have increased expertise in satisfying 
the requirements of the standards, there may be some initial incentive 
for foreign production, but the opportunity for domestic manufacturers 
to sell in other markets might increase. To the extent that the 
requirements of these final rules might lead to installation and use of 
technologies that other countries may seek now or in the future, 
developing this capacity for domestic production now may provide some 
additional ability to serve those markets.
(3) Employment Impacts in Other Affected Sectors
(a) Transport and Shipping Sectors
    Although not directly regulated by these final rules, employment 
effects in the transport and shipping sector are likely to result from 
these regulations. If the overall cost of shipping a ton of freight 
decreases because of increased fuel efficiency (taking into account the 
increase in upfront purchasing costs), in a perfectly competitive 
industry some of these costs savings, depending on the relative 
elasticities of supply and demand, will be passed along to customers. 
Consumer Federation of America expects reduced shipping costs to be 
passed along to customers. With lower prices, demand for shipping would 
lead to an increase in demand for truck shipping services (consistent 
with the VMT rebound effect analysis) and therefore an increase in 
employment in the truck shipping sector. In addition, if the relative 
cost of shipping freight via trucks becomes cheaper than shipping by 
other modes (e.g., rail or barge), then employment in the truck 
transport industry is likely to increase. If the trucking industry is 
more labor intensive than other modes, we would expect this effect to 
lead to an overall increase in employment in the transport and shipping 
sectors.929 930 Such a shift would, however, be at the 
expense of employment in the sectors that are losing business to 
trucking. The first effect--a gain due to lower shipping costs--is 
likely to lead to a net increase in employment. The second effect, due 
to mode-shifting, may increase employment in trucking, but decrease 
employment in other shipping sectors (e.g., rail or barge), with the 
net effects dependent on the labor-intensity of the sectors and the 
volumes.
---------------------------------------------------------------------------

    \929\ American Transportation Research Institute, ``An Analysis 
of the Operational Costs of Trucking: 2011 Update.'' See http://www.atri-online.org/research/results/Op_Costs_2011_Update_one_page_summary.pdf, Docket EPA-HQ-OAR-2014-
0827-512.
    \930\ Association of American Railroads, ``All Inclusive Index 
and Rail Adjustment Factor.'' June 3, 2011. See http://www.aar.org/
~/media/aar/RailCostIndexes/AAR-RCAF-2011-Q3.ashx, Docket EPA-HQ-
OAR-2014-0827-0065.
---------------------------------------------------------------------------

(b) Fuel Suppliers
    In addition to the effects on the trucking industry and related 
truck parts sector, these final rules will result in reductions in fuel 
use that lower GHG emissions. Fuel saving, principally reductions in 
liquid fuels such as diesel and gasoline, will affect employment in the 
fuel suppliers industry sectors, principally the Petroleum Refinery 
sector.
    Section IX.C. of this Preamble provides estimates of the effects of 
these standards on expected fuel consumption. While reduced fuel 
consumption represents savings for purchasers of fuel, it also 
represents a loss in value of output for the petroleum refinery 
industry, which will result in reduced sectoral employment. Because 
this sector is material-intensive, the employment effect is not 
expected to be large.\931\
---------------------------------------------------------------------------

    \931\ In the 2014 BLS ERM cited above, the Petroleum and Coal 
Products Manufacturing sector has a ratio of workers per $1 million 
of 0.215, lower than all but two of the 181 sectors with non-zero 
employment per $1 million.
---------------------------------------------------------------------------

(c) Fuel Savings
    As a result of this final rulemaking, it is anticipated that 
trucking firms will experience fuel savings. Fuel savings lower the 
costs of transportation goods and services. In a competitive market, 
some of the fuel savings that initially accrue to trucking firms are 
likely to be passed along as lower transportation costs that, in turn, 
could result in lower prices for final goods and services. Some 
commenters provide estimates of per-household fuel savings ranging from 
$150 per year by 2030 (Clean Fuels Ohio, Edison Solar, a mass comment 
campaign sponsored by Pew Charitable Trusts, Quasar Energy Group), to 
$400 in 2035 (Environmental Defense Fund); they view these savings as 
providing benefits to the wider economy. The National Ready Mixed 
Concrete Association emphasizes concerns about the costs that the 
standards will impose. Although the agencies do not endorse the 
particular values provided in the comments, we agree that the standards 
will provide net benefits to the U.S.; as shown in Section IX.K., the 
benefits exceed the costs by a wide margin. As noted above, the 
Consumer Federation of America expects consumers to recover these fuel 
savings via the costs of goods and services relying on HD vehicles. The 
agencies note that some of the savings might also be retained by firms 
for investments or for distributions to firm owners. Again, how much 
accrues to customers versus firm owners will depend on the relative 
elasticities of supply and demand. Regardless, the savings will accrue 
to some segment of consumers: Either owners of trucking firms or the 
general public, and the effect will be increased spending by consumers 
in other sectors of the economy, creating jobs in a diverse set of 
sectors, including retail and service industries.
    As described in Section IX.C.(2), the retail value of fuel savings 
from this final rulemaking is projected to be $15.8 billion (2013$) in 
2027, according to Table IX-6. If all those savings are spent, the fuel 
savings will stimulate increased employment in the economy through 
those expenditures. If the fuel savings accrue primarily to firm 
owners, they may either reinvest the money or take it as profit. 
Reinvesting the money in firm operations could increase employment 
directly. If they take the money as profit, to the extent that these 
owners are wealthier than the general public, they may spend less of 
the savings, and the resulting employment impacts would be smaller than 
if the savings went to the public. Thus, while fuel savings are 
expected to decrease employment in the refinery sector, they are 
expected to increase employment through increased consumer 
expenditures.
(4) Summary of Employment Impacts
    The primary employment effects of these rules are expected to be 
found throughout several key sectors: Truck and engine manufacturers, 
the trucking industry, truck parts manufacturing, fuel production, and 
consumers. These rules initially takes effect in model year 2018; the 
unemployment rate at that time is unknowable. In an economy with full 
employment, the primary employment effect of a rulemaking is likely to 
be to move employment from one sector to another, rather than to 
increase or decrease employment. For that reason, we focus our partial 
quantitative analysis on employment in the regulated sector, to examine 
the impacts on that sector directly. We discuss the likely direction of 
other impacts in the regulated sector as well as in other directly 
related sectors, but we do not quantify those impacts, because they are 
more difficult to quantify with reasonable accuracy, particularly so 
far into the future.
    For the regulated sector, we have not quantified the output effect. 
The

[[Page 73903]]

substitution effect is associated with potential increased employment 
between zero and 4.5 thousand jobs per year between 2018 and 2027, 
depending on the share of employment impacts in the affected sectors 
(Motor Vehicle Manufacturing, Motor Vehicle Body and Trailer 
Manufacturing, and Motor Vehicle Parts Manufacturing). These estimates 
do not include potential changes, either greater or less, in labor 
intensity of production. As mentioned above, some of these job gains 
may occur earlier as auto manufacturers and parts suppliers hire staff 
to prepare to comply with the standard.
    Lower prices for shipping are expected to lead to an increase in 
demand for truck shipping services and, therefore, an increase in 
employment in that sector, though this effect may be offset somewhat by 
changes in employment in other shipping sectors. Reduced fuel 
production implies less employment in the fuel provision sectors. 
Finally, any net cost savings are expected to be passed along to some 
segment of consumers: Either the general public or the owners of 
trucking firms, who are expected then to increase employment through 
their expenditures. Under conditions of full employment, any changes in 
employment levels in the regulated sector due to this program are 
mostly expected to be offset by changes in employment in other sectors.

M. Cost of Ownership and Payback Analysis

    This section examines the economic impacts of the Phase 2 standards 
from the perspective of buyers, operators, and subsequent owners of new 
HD vehicles at the level of individual purchasers of different types of 
vehicles. In each case, the analysis assumes that HD vehicle 
manufacturers are able to recover their costs for improving fuel 
efficiency--including direct technology outlays, indirect costs, and 
normal profits on any additional capital investments--by charging 
higher prices to HD vehicle buyers.
    Table IX-34 reports aggregate benefits and costs to buyers and 
operators of new HD vehicles for the final program using Method A. The 
table reports economic impacts on buyers using only the 7 percent 
discount rate, since that rate is intended to represent the opportunity 
cost of capital that HD vehicle buyers and users must divert from other 
investment opportunities to purchase more costly vehicles. As it shows, 
fuel savings and the other benefits from increased fuel efficiency--
savings from less frequent refueling and benefits from additional truck 
use--far outweigh the higher costs to buyers of new HD vehicles. As a 
consequence, buyers, operators, and subsequent owners of HD vehicles 
subject to the Phase 2 standards are together projected to experience 
large economic gains under the final program. It should be noted that, 
because the original buyers may not hold the vehicles for their 
lifetimes, and because those who own or operate the vehicles may not 
pay for the fuel, these benefits and costs do not necessarily represent 
benefits and costs to identifiable individuals.
    As Table IX-34 shows, the agencies have estimated the increased 
costs for maintenance of the new technologies that HD vehicle 
manufacturers will employ to decrease fuel consumption, and these costs 
are included together with those for purchasing more fuel-efficient 
vehicles. Manufacturers' efforts to comply with the Phase 2 standards 
could also result in changes to vehicle performance and capacity for 
certain vehicles. For example, reducing the mass of HD vehicles in 
order to improve fuel efficiency could be used to improve their load-
carrying capabilities, while some engine technologies and aerodynamic 
modifications could reduce payload capacity.

    Table IX-34--MY 2018-2029 Lifetime Aggregate Impacts of the Final
      Program on All HD Vehicle Buyers and Operators Using Method A
                [Billions of 2013$, Discounted at 7%] \a\
------------------------------------------------------------------------
                                            Baseline 1a     Baseline 1b
------------------------------------------------------------------------
Vehicle costs...........................            16.6            16.1
Maintenance costs.......................             0.9             0.9
rrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr
    Total costs to HD vehicle buyers....            17.5            17.0
Fuel savings \b\ (valued at retail                  97.7            89.5
 prices)................................
Refueling benefits......................             1.7             1.6
Increased travel benefits...............             3.5             3.4
rrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr
    Total benefits to HD vehicle buyers/             103            94.5
     operators..........................
    Net benefits to HD vehicle buyers/              85.4            77.5
     operators \c\......................
------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section
  I.D; for an explanation of the less dynamic baseline, 1a, and more
  dynamic baseline, 1b, please see Section X.A.1.
\b\ Fuel savings includes fuel consumed during additional rebound
  driving.
\c\ Net benefits shown do not include benefits associated with carbon or
  other co-pollutant emission reductions, crash/congestion/noise
  impacts, energy security, etc.

    It is also useful to examine the cost of purchasing and owning a 
new vehicle that complies with the Phase 2 standards and its payback 
period--the point at which cumulative savings from lower fuel 
expenditures outpace increased vehicle costs. For example, a new MY 
2027 tractor is estimated to cost roughly $13,550 more (on average, or 
roughly 13 to 14 percent of a typical $100,000 reference case tractor) 
due to the addition of new GHG reducing/fuel consumption improving 
technology. This new technology will result in lower fuel consumption 
and, therefore, reduced fuel expenditures. But how many months or years 
will pass before the reduced fuel expenditures will surpass the 
increased upfront costs?
    Table IX-35 presents the discounted annual increased vehicle costs 
and fuel savings associated with owning a new MY 2027 HD pickup or van 
using both 3 percent and 7 percent discount rates. Table IX-36 and 
Table IX-37 show the same information for a MY 2027 vocational vehicle 
and a tractor/trailer, respectively. These comparisons include sales 
taxes, excise taxes (for vocational and tractor/trailer) and increased 
insurance expenditures on the higher value vehicles, as well as 
maintenance costs throughout the lifetimes of affected vehicles.

[[Page 73904]]

    The fuel expenditure column uses retail fuel prices specific to 
gasoline and diesel fuel as projected in AEO2015.\932\ This payback 
analysis does not include other impacts, such as reduced refueling 
events, the value of driving potential rebound miles, or noise, 
congestion and crashes. We use retail fuel prices and exclude these 
other private and social impacts because the analysis is intended to 
focus on those factors that are most important to buyers when 
considering a new vehicle purchase, and to include only those factors 
that have clear dollar impacts on HD vehicle buyers.
---------------------------------------------------------------------------

    \932\ U.S. Energy Information Administration, Annual Energy 
Outlook 2015; Report Number DOE/EIA-0383(2015), April 2015.
---------------------------------------------------------------------------

    As shown, payback will occur in the 3rd year of ownership for HD 
pickups and vans (the first year where cumulative net costs turn 
negative), in the 4th year for vocational vehicles and early in the 2nd 
year for tractor/trailers. Note that each table reflects the average 
vehicle and reflects proper weighting of fuel consumption/costs 
(gasoline vs. diesel).

         Table IX-35--Discounted Annual Incremental Expenditures for a MY 2027 HD Pickup or Van Using Method B and Relative to the Flat Baseline
                                                                       [2013$] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   3% Discount rate                                    7% Discount rate
                                                 -------------------------------------------------------------------------------------------------------
                  Age in years                                                            Cumulative                                          Cumulative
                                                  Vehicle \b\   Maint \c\     Fuel \d\       net      Vehicle \b\   Maint \c\     Fuel \d\       net
--------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................      -$1,451          -$4         $550        -$905      -$1,424          -$4         $540        -$888
2...............................................          -25           -4          539         -395          -24           -3          509         -406
3...............................................          -24           -3          527          105          -21           -3          479           49
4...............................................          -22           -3          515          595          -19           -3          451          477
5...............................................          -21           -3          492        1,064          -17           -3          415          872
6...............................................          -19           -3          469        1,511          -16           -2          381        1,235
7...............................................          -18           -3          446        1,936          -14           -2          348        1,567
8...............................................          -17           -2          423        2,340          -13           -2          318        1,870
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
\b\ Includes new technology costs, insurance costs and sales taxes.
\c\ Maintenance costs.
\d\ Uses AEO2015 retail fuel prices.


        Table IX-36--Discounted Annual Incremental Expenditures for a MY 2027 Vocational Vehicle Using Method B and Relative to the Flat Baseline
                                                                       [2013$] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   3% Discount rate                                    7% Discount rate
                                                 -------------------------------------------------------------------------------------------------------
                  Age in years                                                            Cumulative                                          Cumulative
                                                  Vehicle \b\   Maint \c\     Fuel \d\       net      Vehicle \b\   Maint \c\     Fuel \d\       net
--------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................      -$3,147         -$25       $1,022      -$2,151      -$3,088         -$25       $1,003      -$2,110
2...............................................          -49          -24        1,004       -1,220          -46          -23          948       -1,231
3...............................................          -46          -24          987         -303          -42          -21          898         -397
4...............................................          -43          -23          970          602          -38          -20          849          394
5...............................................          -40          -21          909        1,450          -34          -18          766        1,109
6...............................................          -38          -19          850        2,243          -31          -15          689        1,752
7...............................................          -35          -17          796        2,987          -27          -14          622        2,333
8...............................................          -33          -16          743        3,681          -25          -12          558        2,854
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
\b\ Includes new technology costs, insurance costs, excise and sales taxes.
\c\ Maintenance costs.
\d\ Uses AEO2015 retail fuel prices.


         Table IX-37--Discounted Annual Incremental Expenditures for a MY 2027 Tractor/Trailer Using Method B and Relative to the Flat Baseline
                                                                       [2013$] \a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   3% Discount rate                                    7% Discount rate
                                                 -------------------------------------------------------------------------------------------------------
                  Age in years                                                            Cumulative                                          Cumulative
                                                  Vehicle \b\   Maint \c\     Fuel \d\       net      Vehicle \b\   Maint \c\     Fuel \d\       net
--------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................     -$16,022        -$169      $15,310        -$880     -$15,719        -$166      $15,021        -$864
2...............................................         -251         -163       15,095       13,801         -237         -154       14,256       13,002
3...............................................         -235         -158       14,872       28,280         -214         -144       13,521       26,166

[[Page 73905]]

 
4...............................................         -220         -153       14,637       42,545         -192         -134       12,809       38,649
5...............................................         -206         -140       13,683       55,882         -173         -118       11,527       49,885
6...............................................         -192         -127       12,730       68,292         -156         -103       10,323       59,950
7...............................................         -179         -116       11,880       79,878         -140          -90        9,274       68,993
8...............................................         -166         -105       11,025       90,630         -125          -79        8,285       77,074
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat baseline, 1a, and dynamic baseline, 1b,
  please see Section X.A.1.
\b\ Includes new technology costs, insurance costs, excise and sales taxes.
\c\ Maintenance costs.
\d\ Uses AEO2015 retail fuel prices.

N. Safety Impacts

(1) Summary of Supporting HD Vehicle Safety Research
    As discussed in the Notice of Proposed Rulemaking, NHTSA and EPA 
considered the potential safety impact of technologies that improve 
Medium- and Heavy-Duty vehicle fuel efficiency and GHG emissions when 
determining potential regulatory alternatives. The safety assessment of 
the technologies in this rule was informed by two comprehensive NAS 
reports, an extensive analysis of safety effects of HD pickups and vans 
using estimates from the DOT report on the effect of mass reduction and 
vehicle size on safety, and focused agency-sponsored safety testing and 
research. The following section provides a concise summary of the 
literature and work considered by the agencies in development of this 
final rule.
(a) National Academy of Sciences Medium and Heavy Duty Phase 1 and 
Phase 2 Reports
    As required by EISA, the National Research Council has been 
conducting continuing studies of the technologies and approaches for 
reducing the fuel consumption of medium- and heavy-duty vehicles. The 
first was a report issued in 2010, ``Technologies and Approaches to 
Reducing the Fuel Consumption of Medium- and Heavy-Duty Vehicles'' 
(``NAS Report''). The second was a report issued in 2014, ``Reducing 
the Fuel Consumption and Greenhouse Gas Emissions of Medium- and Heavy-
Duty Vehicles, Phase Two-First Report'' (``NAS HD Phase 2 First 
Report''). While the reports primarily focused on reducing vehicle fuel 
consumption and emissions through technology application, and examined 
potential regulatory frameworks, both reports contain findings and 
recommendations related to safety. In developing this rule, the 
agencies carefully considered the reports' findings related to safety.
    In particular, NAS indicated that idle reduction strategies can 
also accommodate for the safety of the driver in both hot and cold 
weather conditions. The agencies considered this potential approach for 
application of idle reduction technologies by allowing for override 
provisions, as defined in 40 CFR 1037.660(b), where operator safety is 
a primary consideration. Override is allowed if the external ambient 
temperature reaches a level below which or above which the cabin 
temperature cannot be maintained within reasonable heat or cold 
exposure threshold limit values for the health and safety of the 
operator (not merely comfort).
    NAS also reported extensively on the emergence of natural gas (NG) 
as a viable fuel option for commercial vehicles, but alluded to the 
existence of uncertainties regarding its safety. The committee found 
that while the public crash databases do not contain information on 
vehicle fuel type, the information, at the time of the report, 
indicates that the crash-related safety risk for NG storage on vehicles 
does not appear to be appreciably different from diesel fuel risks. The 
committee also found that while there are two existing SAE-recommended 
practice standards for NG-powered HD vehicles, the industry could 
benefit from best practice directives to minimize crash risks for NG 
fuel tanks, such as on shielding to prevent punctures during crashes. 
As a final point, NAS stated that manufacturers and operators have a 
great incentive to prevent possible NG leakage from a vehicle fuel 
system because it will be a significant safety concern and reduce 
vehicle range. No recommendations were made for additional Federal 
safety regulations for these vehicles. In response, the agencies 
reviewed and discussed the existing NG vehicle standards and best 
practices cited by NAS in Section XI of the NPRM.
    In the NAS Committee's Phase 1 report, the Committee indicated that 
aerodynamic fairings detaching from trucks on the road could be a 
potential safety issue. However, the Phase 2 interim report stated that 
``Anecdotal information gained during the observations of on-road 
trailers indicates a few skirts badly damaged or missing from one side. 
The skirt manufacturers report no safety concerns (such as side skirts 
falling off) and little maintenance needed.''
    The NAS report also identified the link between tire inflation and 
condition and vehicle stopping distance and handling, which impacts 
overall safety. The committee found that tire pressure monitoring 
systems and automatic tire inflation systems are being adopted by 
fleets at an increasing rate. However, the committee noted that there 
are no standards for performance, display, and system validation. The 
committee recommended that NHTSA issue a white paper on the minimum 
performance of tire pressure systems from a safety perspective.
    The agencies considered the safety findings in both NAS reports in 
developing this rule and conducted additional research on safety to 
further examine information and findings of the reports.
(b) DOT CAFE Model Heavy-Duty Pickup and Van Safety Analysis
    This analysis considered the potential crash safety effects on the 
technologies manufacturers may apply to HD pickups

[[Page 73906]]

and vans to meet each of the regulatory alternatives evaluated in the 
NPRM. NHTSA research has shown that vehicle mass reduction affects 
overall societal fatalities associated with crashes and, most relevant 
to this rule, that mass reduction in heavier light- and medium-duty 
vehicles has an overall beneficial effect on societal fatalities. 
Reducing the mass of a heavier vehicle involved in a multiple vehicle 
crash reduces the likelihood of fatalities among the occupants of the 
other vehicle(s). In addition to the effects of mass reduction, the 
analysis anticipates that these standards, by reducing the cost of 
driving HD pickups and vans, will lead to increased travel by these 
vehicles and, therefore, more crashes involving these vehicles. Both 
the Method A and B analyses, both of which are included in the NPRM and 
are part of this final rulemaking, consider overall impacts from both 
of these factors, using a methodology similar to NHTSA's analyses for 
the MYs 2017-2025 CAFE and GHG emission standards.
    The Method A analysis included estimates of the extent to which HD 
pickups and vans produced during MYs 2014-2030 may be involved in fatal 
crashes, considering the mass, survival, and mileage accumulation of 
these vehicles, taking into account changes in mass and mileage 
accumulation under each regulatory alternative. These calculations make 
use of the same coefficients applied to light trucks in the MYs 2017-
2025 CAFE rulemaking analysis. As discussed above, vehicle miles 
traveled may increase due to the fuel economy rebound effect, resulting 
from improvements in vehicle fuel efficiency and cost of fuel, as well 
as the assumed future growth in average vehicle use. Increases in total 
lifetime mileage increase exposure to vehicle crashes, including those 
that result in fatalities. Consequently, the modeling system computes 
total fatalities attributed to vehicle use for vehicles of a given 
model year based on safety class and weight threshold. These 
calculations also include a term that accounts for the fact that some 
of the vehicles involved in future crashes will comply with more 
stringent safety standards than those involved in past crashes upon 
which the base rates of involvement in fatal crashes were estimated. 
Since the use of mass reducing technology is present within the model, 
safety impacts may also be observed whenever a vehicle's base weight 
decreases. Thus, in addition to computing total fatalities related to 
vehicle use, the modeling system also estimates changes in fatalities 
due to reduction in a vehicle's curb weight.
    The total fatalities attributed to vehicle use and vehicle weight 
change for vehicles of a given model year are then summed. Lastly, 
total fatalities occurring within the industry in a given model year 
are accumulated across all vehicles. In addition to using inputs to 
estimate the future involvement of modeled vehicles in crashes 
involving fatalities, the model also applies inputs defining other 
crash-related externalities estimated on a dollar per mile basis. For 
vehicles above 4,594 lbs--i.e., the majority of the HD pickup and van 
fleet--mass reduction is estimated to reduce the net incidence of 
highway fatalities by 0.34 percent per 100 lbs of removed curb weight. 
For the few HD pickups and vans below 4,594 lbs, mass reduction is 
estimated to increase the net incidence of highway fatalities by 0.52 
percent per 100 lbs. The overall effect of mass reduction in the 
segment is estimated to reduce the incidence of highway fatalities as 
there are more HD pickups and vans above 4,594 lbs than below. The 
projected increase in vehicle miles traveled, due to the fuel economy 
rebound effect, also potentially increases exposure to vehicle crashes 
and offsets these reductions.
(c) Volpe Research on MD/HD Fuel Efficiency Technologies
    The 2010 National Research Council report ``Technologies and 
Approaches to Reducing the Fuel Consumption of Medium- and Heavy-Duty 
Vehicles'' recommended that NHTSA perform a thorough safety analysis to 
identify and evaluate potential safety issues with fuel efficiency-
improving technologies. The Department of Transportation Volpe Center's 
2015 report titled ``Review and Analysis of Potential Safety Impacts 
and Regulatory Barriers to Fuel Efficiency Technologies and Alternative 
Fuels in Medium- and Heavy-Duty Vehicles'' summarizes research and 
analysis findings on potential safety issues associated with both the 
diverse alternative fuels (natural gas-CNG and LNG, propane, biodiesel, 
and power train electrification), and the specific FE technologies 
recently adopted by the MD/HDV fleets.\933\ These include Intelligent 
Transportation Systems (ITS) and telematics, speed limiters, idle 
reduction devices, tire technologies (single-wide tires, and tire 
pressure monitoring systems-TPMS and Automated Tire Inflation Systems-
ATIS), aerodynamic components, vehicle light-weighting materials, and 
Long Combination Vehicles (LCVs).
---------------------------------------------------------------------------

    \933\ Brecher, A., Epstein, A. K., & Breck, A. (2015, June). 
Review and analysis of potential safety impacts of and regulatory 
barriers to fuel efficiency technologies and alternative fuels in 
medium- and heavy-duty vehicles. (Report No. DOT HS 812 159). 
Washington, DC: National Highway Traffic Safety Administration.
---------------------------------------------------------------------------

    Chapter 1 provides an overview of the study's rationale, 
background, and key objective, namely, to identify the technical and 
operational/behavioral safety benefits and disbenefits of MD/HDVs 
equipped with FE technologies and using emerging alternative fuels 
(AFs). Recent MD/HDV national fleet crash safety statistical averages 
are also provided for context, although no information exists in crash 
reports relating to specific vehicle FE technologies and fuels. (NHTSA/
FARS and FMCSA/CSA databases do not include detailed information on 
vehicle fuel economy technologies, since the state crash report forms 
are not coded down to an individual fuel economy technology level).
    Chapters 2 and 3 are organized by clusters of functionally-related 
FE technologies for vehicles and trailers (e.g., tire systems, ITS, 
light-weighting materials, and aerodynamic systems) and alternative 
fuels, which are described and their respective associated potential 
safety issues are discussed. Chapter 2 summarizes the findings from a 
comprehensive review of available technical and trade literature and 
Internet sources regarding the benefits, potential safety hazards, and 
the applicable safety regulations and standards for deployed FE 
technologies and alternative fuels. Chapter 2 safety-relevant fuel-
specific findings include:
     Both CNG- and LNG-powered vehicles present potential 
hazards, and call for well-known engineering and process controls to 
assure safe operability and crashworthiness. However, based on the 
reported incident rates of NGVs and the experiences of adopting fleets, 
it appears that NGVs can be operated at least as safely as diesel MD/
HDVs.
     There are no safety contraindications to the large scale 
fleet adoption of CNG or LNG fueled heavy duty trucks and buses, and 
there is ample experience with the safe operation of large public 
transit fleets. Voluntary industry standards and best practices suffice 
for safety assurance, though improved training of CMV operators and 
maintenance staff in natural gas safety of equipment and operating 
procedures is needed.
     Observing CNG and LNG fuel system and maintenance facility 
standards, coupled with sound design, manufacture, and inspection of 
natural gas storage tanks will further reduce the

[[Page 73907]]

potential for leaks, tank ruptures, fires, and explosions.
     Biodiesel blends used as drop-in fuels have presented some 
operational safety concerns dependent on blending fraction, such as 
material compatibility, bio-fouling sludge accumulation, or cold-
weather gelling. However, best practices for biodiesel storage, and 
improved gaskets and seals that are biodiesel resistant, combined with 
regular maintenance and leak inspection schedules for the fuel lines 
and components enable the safe use of biodiesel in newer MD/HDVs.
     Propane (LPG, or autogas) presents well-known hazards 
including ignition (due to leaks or crash) that are preventable by 
using Overfill Prevention Devices (OPDs), which supplement the 
automatic stop-fill system on the fueling station side, and pressure 
release devices (PRDs). Established best practices and safety codes 
(e.g., NFPA) have proven that propane fueled MD/HDVs can be as 
operationally safe as the conventionally-fueled counterparts.
     As the market penetration of hybrid and electric 
drivetrain accelerates, and as the capacity and reliability of lithium 
ion batteries used in Rechargeable Energy Storage Systems (RESS) 
improve, associated potential safety hazards (e.g., electrocution from 
stranded energy, thermal runaway leading to battery fire) have become 
well understood, preventable, and manageable. Existing and emerging 
industry technical and safety voluntary standards, applicable NHTSA 
regulations and guidance, and the growing experience with the operation 
of hybrid and electric MD/HDVs will enable the safe operation and 
large-scale adoption of safer and more efficient power-train 
electrification technologies.
    The safety findings from literature review pertaining to the 
specific FE technologies implemented to date in the MD/HDV fleet 
include:
     Telematics--integrating on-board sensors, video, and audio 
alerts for MD/HDV drivers--offer potential improvements in both driver 
safety performance and fuel efficiency. Both camera and non-camera 
based telematics setups are currently integrated with available crash 
avoidance systems (such as ESC, RSC, LDWS, etc.) and appear to be well 
accepted by MD/HDV fleet drivers.
     Both experience abroad and the cited US studies of trucks 
equipped with active speed limiters indicated a safety benefit, as 
measured by up to 50 percent reduced crash rates, in addition to fuel 
savings and other benefits, with good CMV driver acceptance. Any 
negative aspects were small and avoidable if all the speed limitation 
devices were set to the same speed, so there will be less need for 
overtaking at highway speeds.
     No literature reports of adverse safety impacts were found 
regarding implementation of on-board idle-reduction technologies in MD/
HDVs (such as automatic start-stop, direct-fired heaters, and APUs).
     There was no clear consensus from the literature regarding 
the relative crash rates and highway safety impacts of LCVs, due to 
lack of sufficient data and controls and inconsistent study 
methodologies. Recent safety evaluations of LCVs and ongoing MAP-21 
mandated studies will clarify and quantify this issue.
     Tire technologies for FE (including ATIS, TPMS, LRR and 
single-wide tires) literature raised potential safety concerns 
regarding lower stability or loss of control, e.g., when tire pressure 
is uneven or a single wide tire blows out on the highway. However, 
systems such as automated tire monitoring systems and stability 
enhancing electronic systems (ABS, ESC, and RSC) may compensate and 
mitigate any adverse safety impacts.
     Aerodynamic technologies that offer significant fuel 
savings have raised potential concerns about vehicle damage or injury 
in case of detached fairings or skirts, although there were no 
documented incidents of this type in the literature.
     Some light weighting materials may pose some fire safety 
and crashworthiness hazards, depending on their performance in 
structural or other vehicle subsystem applications (chassis, 
powertrain, and crash box or safety cage). Some composites (fiberglass, 
plastics, CFRC, foams) may become brittle on impact or due to 
weathering from UV exposure or extreme cold. Industry has developed 
advanced, high performance lightweight material options tailored to 
their automotive applications, e.g., thermoplastics resistant to UV and 
weathering. No examples of such lightweight material failures on MD/
HDVs were identified in the literature.
    Chapter 3 provides complementary inputs on the potential safety 
issues associated with FE technologies and alternative fuels obtained 
from Subject Matter Experts (SMEs). The broad cross-section of SMEs 
consulted had experience with the operation of ``green'' truck and bus 
fleets, were Federal program managers, or were industry developers of 
FE systems for MD/HDVs. Safety concerns raised by the SMEs can be 
prevented or mitigated by complying with applicable regulations and 
safety standards and best practices, and are being addressed by 
evolving technologies, such as electronic collision prevention devices. 
Although SMEs raised some safety concerns, their experience indicates 
that system- or fuel-specific hazards can be prevented or mitigated by 
observing applicable industry standards, and by training managers, 
operators and maintenance staff in safety best practices. Specific 
safety concerns raised by SMEs based on their experience included:
     Alternative fuels did not raise major safety concerns, but 
generally required better education and training of staff and 
operators. There was a concern expressed regarding high pressure (4000 
psi) CNG cylinders that could potentially explode in a crash scenario 
or if otherwise ruptured. However, aging CNG fuel tank safety can be 
assured by enforcing regulations such as FMVSS No. 304, and by periodic 
inspection and end-of-life disposal and replacement. A propane truck 
fleet manager stated that the fuel was as safe as or safer than 
gasoline, and reported no safety issues with the company's propane, nor 
with hybrid gasoline-electric trucks. OEMs of drivetrain hybridization 
and electrification systems, including advanced Lithium Ion batteries 
for RESS, indicated that they undergo multiple safety tests and are 
designed with fail-safes for various misuse and abuse scenarios. 
Integration of hybrid components downstream by bodybuilders in 
retrofits, as opposed to new vehicles, was deemed a potential safety 
risk. Another potential safety concern raised was the uncertain battery 
lifetime due to variability of climate, duty-cycles, and aging. Without 
state-of-charge indicators, this could conceivably leave vehicles 
underpowered or stranded if the battery degrades and is not serviced or 
replaced in a timely manner.
     ITS and telematics raised no safety concerns; on the 
contrary, fleet managers stated that ``efficient drivers are safer 
drivers.'' Monitoring and recording of driver behavior, combined with 
coaching, appeared to reduce distracted and aggressive driving and 
provided significant FE and safety benefits.
     A wide-base single tire safety concern was the decrease in 
tire redundancy in case of a tire blowout at highway speeds. For LRRs, 
a concern was that they could negatively affect truck stopping distance 
and stability control.
     A speed-limiter safety concern was related to scenarios 
when such trucks pass other vehicles on the highway instead of staying 
in the right-hand lane

[[Page 73908]]

behind other vehicles. By combining speed limiters with driver training 
programs, overall truck safety could actually improve, as shown by 
international practice.
     Aerodynamic systems' safety performance to date was 
satisfactory, with no instances of on-road detaching. However, covering 
underside or other components with aerodynamic fairings can make them 
harder to inspect, such as worn lugs, CNG relief valve shrouds, wheel 
covers, and certain fairings. Drivers and inspectors need to be able to 
see through wheel covers and to be able to access lug nuts through 
them. These covers must also be durable to withstand frequent road 
abuse.
     For lightweighting materials, the safety concern raised 
was lower crashworthiness (debonding or brittle fracture on impact) and 
the potential for decreased survivability in vehicle fires depending on 
the specific material choice and its application.
    The key finding from the literature review and SME interviews is 
that there appear to be no major safety hazards preventing the adoption 
of FE technologies, or the increased use of alternative fuels and 
vehicle electrification. In view of the scarcity of hard data currently 
available on actual highway crashes that can be directly or causally 
attributed to adoption of FE technologies and/or alternative fuels by 
MD/HDVs, and the limited experience with commercial truck and transit 
bus fleets operations equipped with these technologies, it was not 
possible to perform a quantitative, probabilistic risk assessment, or 
even a semi-quantitative preliminary hazard analysis (PHA). Chapter 4 
employs a deterministic scenario-based hazard analysis of potential 
crash or other safety concerns identified from the literature review or 
raised by subject matter experts (SMEs) interviewed (e.g., interfaces 
with charging or refueling infrastructure). For each specific hazard 
scenario discussed, the recommended prevention or mitigation options, 
including compliance with applicable NHTSA or FMCSA regulations, and 
voluntary industry standards and best practices are identified, along 
with FE technology or fuel-specific operator training. SMEs safety 
concerns identified in Sec 3.3 were complemented with actual incidents, 
and developed into the hazard scenarios analyzed in Chapter 4.
    The scenario-based deterministic hazard analysis reflected not only 
the literature findings and SMEs' safety concerns, but also real truck 
or bus mishaps that have occurred in the past. Key hazard analysis 
scenarios included: CNG-fueled truck and bus vehicle fires or 
explosions due to tank rupture, when pressurized fuel tanks were 
degraded due to aging or when PRDs failed; LNG truck crashes leading to 
fires, or LNG refueling-related mishaps; the flammability or brittle 
fracture issues related to light weighting materials in crashes; 
reduced safety performance for either LRR or wide-base tires; highway 
pile-ups when LCVs attempt to pass at highway speeds; aerodynamic 
components detaching while the vehicle traveled on a busy highway or 
urban roadway; and fires resulting in overheated lithium ion batteries 
in electric or hybrid buses. These hypothetical worst case scenarios 
appear to be preventable or able to be mitigated by observing safety 
regulations and voluntary standards, or with engineering and 
operational best practices.
    Chapter 5 reviews and discusses the existing federal and state 
regulatory framework for safely operating MD/HDVs equipped with FE 
technologies or powered by alternative fuels. The review identifies 
potential regulatory barriers to their large-scale deployment in the 
national fleet that could delay achievement of desired fuel consumption 
and environmental benefits, while ensuring equal or better safety 
performance.
    Chapter 6 summarizes the major findings and recommendations of this 
preliminary safety analysis of fuel efficiency technologies and 
alternative fuels adopted by MD/HDVs. The scenario-based hazard 
analysis, based on the literature review and experts' inputs, indicates 
that MD/HDVs equipped with advanced FE technologies and/or using 
alternative fuels have manageable potentially adverse safety impacts. 
The findings suggest that the potential safety hazards identified 
during operation, maintenance, and crash scenarios can be prevented or 
mitigated by complying with safety regulations and voluntary standards 
and industry best practices. The study also did not identify any major 
regulatory barriers to rapid adoption of FE technologies and 
alternative fuels by the MD/HDV fleet.
(d) Oak Ridge National Laboratory (ORNL) Research on Low Rolling 
Resistance Truck Tires
    DOT's Federal Motor Carrier Safety Administration and NHTSA 
sponsored a test program conducted by Oak Ridge National Laboratory to 
explore the effects of tire rolling resistance levels on Class 8 
tractor-trailer stopping distance performance over a range of loading 
and surface conditions. The objective was to determine whether a 
relationship exists between tire rolling resistance and stopping 
distance for vehicles of this type. The overall results of this 
research suggest that tire rolling resistance is not a reliable 
indicator of Class 8 tractor-trailer stopping distance.
    The correlation coefficients (R2 values) for linear regressions of 
wet and dry stopping distance versus overall vehicle rolling resistance 
values did not meet the minimum threshold for statistical significance 
for any of the test conditions. Correlation between CRR and stopping 
distance was found to be negligible for the dry tests for both loading 
conditions. While correlation was higher for the wet testing (showing a 
slight trend in which lower CRRs correspond to longer stopping 
distances), it still did not meet the minimum threshold for statistical 
significance. In terms of compliance with Federal safety standards, it 
was found that the stopping distance performance of the vehicle with 
the four tire sets studied in this research (with estimated tractor 
CRRs which varied by 33 percent), were well under the FMVSS No. 121 
stopping distance requirements.
(e) Additional Safety Considerations
    The agencies considered the Organic Rankine Cycle waste heat 
recovery (WHR) as a fuel saving technology in the rulemaking timeframe. 
The basic approach of these systems is to use engine waste heat from 
multiple sources to evaporate a working fluid through a heat exchanger, 
which is then passed through a turbine or equivalent expander to create 
mechanical or electrical power. The working fluid is then condensed as 
it passes through a heat exchanger and returns to back to the fluid 
tank, and pulled back to the flow circuit through a pump to continue 
the cycle.
    Despite the promising performance of pre-prototype WHR systems, 
manufacturers have not yet arrived at a consensus on which working 
fluid(s) to be used in WHR systems to balance concerns regarding 
performance, global warming potential (GWP), and safety. Working fluids 
have a high GWP (conventional refrigerant), are expensive (low GWP 
refrigerant), are hazardous (such as ammonia, etc.), are flammable 
(ethanol/methanol), or can freeze (water). One challenge is determining 
how to seal the working fluid properly under the vacuum condition and 
high temperatures to avoid safety issues for flammable/hazardous 
working fluids. Because of these challenges, choosing a working fluid 
will be an important factor for system safety, efficiency, and overall 
production viability.

[[Page 73909]]

    The agencies believe manufacturers will require additional time and 
development effort to assure that a working fluid that is both 
appropriate, given the noted challenges, and has a low GWP for use in 
waste heat recovery systems. Based on this and other factors, the 
analysis used for both the proposed Preferred Alternative and for this 
final rule assumes that WHR will not achieve a significant market 
penetration for diesel tractor engines (i.e., greater than 5 percent) 
until 2027, which will provide time for these considerations to be 
addressed. The agencies assume no use of this technology in the HD 
pickups and vans and vocational vehicle segments.
(2) Safety Related Comments to the NPRM
    The agencies received safety related comments to the NPRM focused 
on the vehicle and operator safety benefits of central tire inflation 
systems, potential safety and traction impacts of low rolling 
resistance tires, and recommendations that NHTSA continue evaluations 
of potential safety impacts of fuel saving technologies.
    AIR CTI, Inc., a supplier of central tire inflation systems, 
highlighted the safety benefits to both vehicle operation and the 
operators themselves through proper tire pressure management. More 
specifically, the proper tire inflation levels for the load being 
carried contributes to both proper handing for road conditions and 
reducing irregular road surface vibration from being transmission to 
vehicle component and, ultimately, the vehicle operator, where there 
may be potential health implications over prolonged exposure.
    The agencies appreciate the additional points provided by AIR CTI 
in terms of not only the potential fuel efficiency benefits of central 
tire inflation systems but the potential equipment longevity benefits, 
vehicle dynamic impacts, and the potential to reduce driver fatigue and 
injury through proper tire inflation for the load being carried.
    The American Trucking Associations (ATA) commented on the potential 
impact of Low Rolling Resistance Tires by indicating that, ``The safety 
effects of LRRTs are not totally understood. While the ``. . . agencies 
analysis indicate that this proposal should have no adverse impact on 
vehicle or engine safety,'' ATA remains leery of potential unintended 
consequences resulting from new generation tires that have yet to be 
developed. This especially holds true in terms of overall truck braking 
distances.'' The Owner-Operator Independent Drivers Association (OOIDA) 
similarly commented on LRRTs and their ability to meet the tractions 
needs in mountainous regions.
    The agencies continue to stand behind the low rolling resistance 
tire research conducted to date, which includes the study mentioned in 
the previous section, along with any research supporting the 
development, and maintenance, of FMVSS No. 121. The agencies agree, 
though, that continuing research will be important as new tire 
technologies enter the marketplace, and like the extensive rolling 
resistance testing conducting to support the Phase 1 regulation and, in 
part, this final rule, the agencies will continue to monitor 
developments in the tire supply marketplace through the EPA Smartway 
program and other, potential, research. NHTSA notes that FMVSS No. 121 
will continue to play a role in ensuring the safety of both current and 
future tire technologies.
    The ATA also expressed support for the NHTSA study mentioned in the 
previous section, Review and Analysis of Potential Safety Impacts of 
and Regulatory Barriers to Fuel Efficiency Technologies and Alternative 
Fuels in Medium- and Heavy-Duty Vehicles. More specifically, ATA 
requested that DOT/NHTSA and the DOT Volpe Center continue ``to assess 
and evaluate potential safety impacts that may be attributed to the use 
of fuel efficiency devices.'' The agencies appreciate ATA's support and 
acknowledge of this comprehensive, peer-reviewed assessment and we look 
forward to continuing this work to as the need arises.
(3) The Agencies' Assessment of Potential Safety Impacts
    NHTSA and EPA considered the potential safety impact of 
technologies that improve MDHD vehicle fuel efficiency and GHG 
emissions as part of the assessment of regulatory alternatives and 
selection of the final regulatory approach. The safety assessment of 
the technologies in this final rule was informed by two NAS reports, an 
analysis of safety effects of HD pickups and vans using estimates from 
the DOT report on the effect of mass reduction and vehicle size on 
safety, and agency-sponsored safety testing and research. The agencies 
considered safety from the perspective of both direct effects and 
indirect effects.
    In terms of direct effects on vehicle safety, research from NAS and 
Volpe, and direct testing of technologies like the ORNL tire work, 
indicate that there are no major safety hazards associated with the 
adoption of technologies that improve MDHD vehicle fuel efficiency and 
GHG emissions or the increased use of alternative fuels and vehicle 
electrification. The findings suggest that the potential safety hazards 
identified during operation, maintenance, and crash scenarios can be 
prevented or mitigated by complying with safety regulations, voluntary 
standards, and industry best practices. Tire testing showed tire 
rolling resistance did not impact of Class 8 tractor-trailer stopping 
distance for the tires tested. For HD pickup and vans, mass reduction 
is anticipated to reduce the net incidence of highway fatalities, 
because of the beneficial effects of mass reduction in the majority of 
HD pickup and vans which weigh more than 4,594 lbs. Taken together, 
these studies suggest that the fuel efficiency improving technologies 
assessed in the studies can be implemented with no degradation in 
overall safety.
    However, analysis anticipates that the indirect effect of these 
standards, by reducing the operating costs, will lead to increased 
travel by tractor-trailers and HD pickups and vans and, therefore, more 
crashes involving these vehicles.

X. Analysis of the Alternatives

    As discussed in the NPRM and throughout this Preamble, in 
developing this program, the agencies considered a number of regulatory 
alternatives that could result in potentially fewer or greater GHG 
emission and fuel consumption reductions than the Phase 2 program we 
are adopting. This section summarizes the alternatives we considered 
and presents estimates of the CO2 reductions and fuel 
savings associated with them. Although some of the alternatives 
considered for the FRM are identical to alternatives considered for the 
NPRM, the preferred alternative (i.e. the final rule) is actually more 
stringent than the preferred alternative that was proposed, and 
includes some elements of the NPRM's Alternative 4.
    In developing alternatives, both agencies must consider a range of 
stringency. NHTSA must consider EISA's requirement for the MD/HD fuel 
efficiency program. In particular, 49 U.S.C. 32902(k)(2) and (3) 
contain the following three requirements specific to the MD/HD vehicle 
fuel efficiency improvement program: (1) The program must be ``designed 
to achieve the maximum feasible improvement;'' (2) the various required 
aspects of the program must be appropriate, cost-effective, and 
technologically feasible for MD/HD vehicles; and (3) the standards 
adopted under the program must provide not less than four model years 
of lead time and three model years of regulatory stability. In 
considering

[[Page 73910]]

these various requirements, NHTSA will also account for relevant 
environmental and safety considerations.
    As explained in the Phase 1 rule, NHTSA has broad discretion in 
balancing the above factors in determining the improvement that the 
manufacturers can achieve. The fact that the factors may often be 
conflicting gives NHTSA significant discretion to decide what weight to 
give each of the competing policies and concerns and then determine how 
to balance them--as long as NHTSA's balancing does not undermine the 
fundamental purpose of the EISA: Energy conservation, and as long as 
that balancing reasonably accommodates ``conflicting policies that were 
committed to the agency's care by the statute.'' \934\
---------------------------------------------------------------------------

    \934\ Cf. Center for Biological Diversity v. National Highway 
Traffic Safety Admin., 538 F.3d 1172, 1194 (9th Cir. 2008). For 
further discussion see 76 FR 57198.
---------------------------------------------------------------------------

    EPA also has significant discretion in considering a range of 
stringency. Section 202(a)(2) of the Clean Air Act requires only that 
the standards ``take effect after such period as the Administrator 
finds necessary to permit the development and application of the 
requisite technology, giving appropriate consideration to the cost of 
compliance within such period.'' This language affords EPA considerable 
discretion in how to weight the critical statutory factors of emission 
reductions, cost, and lead time. See 76 FR 57129-57130.
    The alternatives presented here follow the format of the 
alternatives addressed in the NPRM. Among the alternatives are a 
preferred alternative (in this action, the ``final program''), more 
stringent alternatives, and less stringent alternatives (including ``no 
action'' alternatives). As discussed in this Preamble's Sections II 
(Engines), III (Tractors), IV (Trailers), V (Vocational Vehicles), and 
VI (Pickups and Vans), NHTSA and EPA determined Alternative 3 to be the 
preferred alternative, or the final program, for each vehicle category. 
This Section X describes all of the alternatives considered, and 
provides context for the relative stringency associated with the final 
program.

A. What are the alternatives that the agencies considered?

    The five alternatives below represent a broad range of potential 
stringency levels, and thus a broad range of associated technologies, 
costs and benefits for a HD vehicle fuel efficiency and GHG emissions 
program. All of the alternatives were modeled using the same 
methodologies described in Chapter 5 of the RIA.
    The alternatives considered for the final rule were conceptually 
similar to (and for some elements, identical to) to the alternatives 
considered for the proposal. The alternatives in order of increasing 
fuel efficiency and GHG emissions reductions are as follows:

1. No action, baseline
2. Less stringent than the proposal
3. Preferred alternative
4. Proposed (not FRM) standards with less lead time
5. More stringent standards than the proposal with less lead time

    Comments on the alternatives overlapped with comments on the 
overall stringency of the proposed Phase 2 program. These comments were 
mixed. Some operators and manufacturers supported the least stringent 
alternatives. Many other commenters, however, including most non-
governmental organizations, supported more stringent standards with 
less lead time. They generally supported Alternative 4. Many technology 
and component suppliers supported more stringent standards but with the 
proposed lead time, and thus generally supported the Alternative 3 
timeframe. Vehicle manufacturers strongly opposed the more stringent 
standards and reduced lead time of Alternative 4. To the extent any of 
these commenters provided technical information to support their 
comments on stringency and lead time, it is discussed in Sections II 
through VI.
    Many of the comments supporting more stringent standards stated 
that they would be ``cost-effective.'' In general, however, we did not 
find costs or cost-effectiveness to be a significantly limiting factor 
in determining the stringency of the standards. Rather, we found that 
actual technological feasibility and lead time to be the more limiting 
factors. Manufacturers and suppliers have limited research and 
development capacities, and although they have some ability to expand, 
that ability is constrained by the lead time required. Lead time 
includes time not only to design and develop a technology, but to bring 
it to market in reliable form. During the prototype stage, all 
prototype components must be available and extensive engine and vehicle 
tests must be conducted. The production start-up phase would follow. 
After that, significant efforts must be made to advance the system from 
a prototype to a commercial product, which typically takes about five 
years for complex systems. During this approximate five-year period, 
multiple vehicles will go through weather condition tests, long lead-
time parts and tools will be identified, and market launch and initial 
results on operating stability will be completed. Production designs 
will be released, all product components should be made available, 
production parts on customer fleets and weather road testing will be 
verified before finally launching production, and distribution of parts 
to the vehicle service network for maintenance and repair will be 
readied. See Section I.C above; see also RIA Chapter 2.3.9. New 
technologies then are ordinarily phased into the commercial market, so 
that fleet operators are assured of technology reliability and utility 
before making extensive purchases. Commenters supporting the more 
stringent alternatives based on cost-effectiveness generally did not 
address these very real lead time constraints.
(1) Alternative 1: No Action (The Baseline for Phase 2)
    OMB guidance regarding regulatory analysis indicates that proper 
evaluation of the benefits and costs of regulations and their 
alternatives requires agencies to identify a baseline:
    ``You need to measure the benefits and costs of a rule against a 
baseline. This baseline should be the best assessment of the way the 
world would look absent the proposed action. The choice of an 
appropriate baseline may require consideration of a wide range of 
potential factors, including:

 Evolution of the market
 changes in external factors affecting expected benefits and 
costs
 changes in regulations promulgated by the agency or other 
government entities
 degree of compliance by regulated entities with other 
regulations

    It may be reasonable to forecast that the world absent the 
regulation will resemble the present. If this is the case, however, 
your baseline should reflect the future effect of current government 
programs and policies. For review of an existing regulation, a baseline 
assuming no change in the regulatory program generally provides an 
appropriate basis for evaluating regulatory alternatives. When more 
than one baseline is reasonable and the choice of baseline will 
significantly affect estimated benefits and costs, you should consider 
measuring benefits and costs against alternative baselines. In doing so 
you can analyze the effects on benefits and costs of making different 
assumptions about other agencies' regulations, or the degree of 
compliance with your own existing rules. In all cases, you must 
evaluate benefits and costs against the same baseline. You should also 
discuss

[[Page 73911]]

the reasonableness of the baselines used in the sensitivity analyses. 
For each baseline you use, you should identify the key uncertainties in 
your forecast.'' \935\
---------------------------------------------------------------------------

    \935\ OMB Circular A-4, September 17, 2003. Available at http://www.whitehouse.gov/omb/circulars_a004_a-4.
---------------------------------------------------------------------------

    A no-action alternative is also required as a baseline against 
which to measure environmental impacts of these standards and 
alternatives. NHTSA, as required by the National Environmental Policy 
Act, is documenting these estimated impacts in the EIS published with 
this final rule.\936\
---------------------------------------------------------------------------

    \936\ NEPA requires agencies to consider a ``no action'' 
alternative in their NEPA analyses and to compare the effects of not 
taking action with the effects of the reasonable action alternatives 
to demonstrate the different environmental effects of the action 
alternatives. See 40 CFR 1502.2(e), and 1502.14(d). CEQ has 
explained that ``[T]he regulations require the analysis of the no 
action alternative even if the agency is under a court order or 
legislative command to act. This analysis provides a benchmark, 
enabling decision makers to compare the magnitude of environmental 
effects of the action alternatives. [See 40 CFR 1502.14(c).]* * * 
Inclusion of such an analysis in the EIS is necessary to inform 
Congress, the public, and the President as intended by NEPA. [See 40 
CFR 1500.1(a).]'' Forty Most Asked Questions Concerning CEQ's 
National Environmental Policy Act Regulations, 46 FR 18026 (1981) 
(emphasis added).
---------------------------------------------------------------------------

    The No Action Alternative for today's analysis, alternatively 
referred to as the ``baseline'' or ``reference case,'' assumes that the 
agencies would not issue new rules regarding MD/HD fuel efficiency and 
GHG emissions. That is, this alternative assumes that the Phase 1 MD/HD 
fuel efficiency and GHG emissions program's model year 2018 standards 
would be extended indefinitely and without change.
    The agencies recognize that there are a number of factors that 
create uncertainty in projecting a baseline against which to compare 
the future effects of the alternatives. The composition of the future 
fleet--such as the relative position of individual manufacturers and 
the mix of products they each offer--cannot be predicted with certainty 
at this time. As reflected, in part, by the market forecast underlying 
the agencies' analysis, we anticipate that the baseline market for 
medium- and heavy-duty vehicles will continue to evolve within a 
competitive market that responds to a range of factors. Additionally, 
the heavy-duty vehicle market is diverse, as is the range of vehicle 
purchasers.
    Heavy-duty vehicle manufacturers have reported that their 
customers' purchasing decisions are influenced by their customers' own 
determinations of minimum total cost of ownership, which can be unique 
to a particular customer's circumstances. For example, some customers 
(e.g., less-than-truckload or package delivery operators) operate their 
vehicles within a limited geographic region and typically own their own 
vehicle maintenance and repair centers within that region. These 
operators tend to own their vehicles for long time periods, and 
sometimes for the entire service life of the vehicle. Their total cost 
of ownership is influenced by their ability to better control their own 
maintenance costs, and thus they can afford to consider fuel efficiency 
technologies that have longer payback periods, outside of the vehicle 
manufacturer's warranty period. Other customers (e.g. truckload or 
long-haul operators) tend to operate cross-country, and thus must 
depend upon truck dealer service centers for repair and maintenance. 
Some of these customers tend to own their vehicles for about four to 
seven years, so that they typically do not have to pay for repair and 
maintenance costs outside of either the manufacturer's warranty period 
or some other extended warranty period. Many of these customers tend to 
require seeing evidence of fuel efficiency technology payback periods 
on the order of 18 to 24 months before seriously considering evaluating 
a new technology for potential adoption within their fleet.\937\ 
Purchasing decisions, however, are not based exclusively on payback 
period, but also include the considerations discussed in this section. 
For the baseline analysis, the agencies use payback period as a proxy 
for all of these considerations, and therefore the payback period used 
for the baseline analysis may be shorter than the payback periods 
industry typically identifies as thresholds for the further 
consideration of a technology. Some owners accrue relatively few 
vehicle miles traveled per year, such that they may be less likely to 
adopt new fuel efficiency technologies, while other owners who use 
their vehicle(s) with greater intensity may be even more willing to pay 
for fuel efficiency improvements. Regardless of the type of customer, 
their determination of minimum total cost of ownership involves the 
customer balancing their own unique circumstances with a heavy-duty 
vehicle's initial purchase price, availability of credit and lease 
options, expectations of vehicle reliability, resale value and fuel 
efficiency technology payback periods. The degree of the incentive to 
adopt additional fuel efficiency technologies also depends on customer 
expectations of future fuel prices, which directly impacts customer 
expectations of the payback period.
---------------------------------------------------------------------------

    \937\ NAS 2010, Roeth et al. 2013, and Klemick et al. 2014.
---------------------------------------------------------------------------

    Another factor the agencies considered is that other federal and 
state-level policies and programs are specifically aimed at stimulating 
fuel efficiency technology development and deployment. Particularly 
relevant to this sector are DOE's 21st Century Truck Partnership, EPA's 
voluntary SmartWay Transport program, and California's AB32 fleet 
requirements.938 939 940 The future availability of more 
cost-effective technologies to reduce fuel consumption could provide 
manufacturers an incentive to produce more fuel-efficient medium- and 
heavy-duty vehicles, which in turn could provide customers an incentive 
to purchase these vehicles. The availability of more cost-effective 
technologies to reduce fuel consumption could also lead to a 
substitution of less cost-effective technologies, where overall fuel 
efficiency could remain fairly flat if buyers are less interested in 
fuel consumption improvements than in reduced vehicle purchase prices 
and/or improved vehicle performance and/or utility.
---------------------------------------------------------------------------

    \938\ http://energy.gov/eere/vehicles/vehicle-technologies-office-21st-century-truck.
    \939\ http://www3.epa.gov/smartway/.
    \940\ State of California Global Warming Solutions Act of 2006 
(Assembly Bill 32, or AB32).
---------------------------------------------------------------------------

    We have also applied the EIA's AEO estimates of future fuel prices; 
however, heavy-duty vehicle customers could have different expectations 
about future fuel prices, and could therefore be more or less inclined 
to apply new technology to reduce fuel consumption than might be 
expected based on EIA's forecast. We expect that vehicle customers will 
be uncertain about future fuel prices, and that this uncertainty will 
be reflected in the degree of enthusiasm to apply new technology to 
reduce fuel consumption.
    Considering all of these factors, the agencies have approached the 
definition of the No Action Alternative separately for each vehicle and 
engine category covered by today's rules. Except as noted below, these 
baselines are largely the same as the proposed Alternatives 1a and 1b, 
which reflected different assumptions about the extent to which the 
market would pay for additional fuel-saving technology without new 
Phase 2 standards. The agencies received limited comments on these 
reference cases. Some commenters expressed support for the la baseline 
in the context of the need for the regulations, arguing that little 
improvement would occur without the regulations. Others supported the 
1a

[[Page 73912]]

baseline because they believe it more fully captures the costs. Some 
commenters thought it reasonable that the agencies consider both 
baselines, given the uncertainty in this area. No commenters opposed 
the consideration of both baselines. The agencies thus continued to 
analyze two different baselines for the final rules as we recognize 
that there are a number of factors that create uncertainty in 
projecting a baseline against which to compare the future effects of 
this action and the remaining alternatives. As was shown in the 
previous sections, the standards are supported by the analysis using 
either baseline.
    For trailers, the agencies considered two No Action alternatives to 
cover a nominal range of uncertainty. The trailer category is unique in 
the context of this rulemaking because it is the only heavy-duty 
category not regulated under Phase 1. The agencies project that in 
2018, about half of new 53' dry van and reefer trailers will have 
technologies qualifying for the SmartWay label for aerodynamic 
improvements and about 90 percent would have the lower rolling 
resistance tires. About half also have automatic tire inflation systems 
to maintain optimal tire pressure. For Alternative 1a as presented in 
this action (referred to as the ``flat'' baseline), this technology 
adoption remains constant after 2018. In the second case, Alternative 
1b, the agencies projected that the combination of EPA's voluntary 
SmartWay program, DOE's 21st Century Truck Partnership, California's 
AB32 trailer requirements for fleets, and the potential for 
significantly reduced operating costs should result in continuing 
improvement to new trailers. The agencies projected that the fraction 
of the in-use fleet qualifying for SmartWay will continue to increase 
beyond 2027 as older trailers are replaced by newer trailers. We 
projected that these improvements will continue until 2040 when 75 
percent of new trailers will be assumed to include skirts.
    For vocational vehicles, the agencies considered one No Action 
alternative. For the vocational vehicle category the agencies 
recognized that these vehicles tend to operate over fewer vehicle miles 
travelled per year. Therefore, the projected payback periods for fuel 
efficiency technologies available for vocational vehicles are generally 
longer than the payback periods the agencies consider likely to lead to 
their adoption based solely on market forces. This is especially true 
for vehicles used in applications in which the vehicle operation is 
secondary to the primary business of the company using the vehicle. For 
example, since the fuel consumption of vehicles used by utility 
companies to repair power lines would generally be a smaller cost 
relative to the other costs of repairing lines, fuel saving 
technologies would generally not be as strongly demanded for such 
vehicles. Thus, the agencies project that fuel-saving technologies will 
either not be applied or will only be applied as a substitute for more 
expensive fuel efficiency technologies, except as necessitated by the 
Phase 1 fuel consumption and GHG standards.
    For tractors, the agencies considered two No Action alternatives to 
cover a nominal range of uncertainty. For Alternative 1a the agencies 
project that fuel-saving technologies will either not be applied or 
will only be applied as a substitute for more expensive fuel efficiency 
technologies to tractors (thereby enabling manufacturers to offer 
tractors that are less expensive to purchase), except as necessitated 
by the Phase 1 fuel consumption and GHG standards. In Alternative 1b 
the agencies estimated that some available technologies will save 
enough fuel to pay back fairly quickly--within the first six months of 
ownership. The agencies considered a range of information to formulate 
these two baselines for tractors.
    Both public \941\ and confidential historical information shows 
that tractor trailer fuel efficiency improved steadily through 
improvements in engine efficiency and vehicle aerodynamics over the 
past 40 years, except for engine efficiency which decreased or was flat 
between 2000 and approximately 2007 as a consequence of incorporating 
technologies to meet engine emission regulations. Today vehicle 
manufacturers, the Federal Government, academia and others continue to 
invest in research to develop fuel efficiency improving technologies 
for the future.
---------------------------------------------------------------------------

    \941\ Committee to Assess Fuel Economy Technologies for Medium- 
and Heavy-Duty Vehicles; National Research Council; Transportation 
Research Board (2010). ``Technologies and Approaches to Reducing the 
Fuel Consumption of Medium- and Heavy-Duty Vehicles,'' (hereafter, 
``NAS 2010''). Washington, DC. The National Academies Press. 
Available electronically from the National Academies Press Web site 
at http://www.nap.edu/catalog.php?record_id=12845 (last accessed 
September 10, 2010).
---------------------------------------------------------------------------

    In public meetings and in meetings with the agencies, the trucking 
industry stated that fuel cost for tractors is the number one or number 
two expense for many operators, and therefore is a very important 
factor for their business. However, the pre-Phase 1 market suggests 
that tractor manufacturers and operators could be slow to adopt some 
new technologies, even where the agencies have estimated that the 
technology would have paid for itself within a few months of operation. 
This phenomenon, which is discussed in Section IX.A, is often called 
the energy paradox. Consistent with the discussion above of reasons for 
needed lead time, tractor operators have told the agencies they 
generally require technologies to be demonstrated in their fleet before 
widespread adoption so they can assess the actual fuel savings for 
their fleet and any increase in cost associated with effects on vehicle 
operation, maintenance, reliability, mechanic training, maintenance and 
repair equipment, stocking unique parts and driver acceptance, as well 
as effects on vehicle resale value. Tractor operators often state that 
they would consider conducting an assessment of technologies when 
provided with data that show the technologies may payback costs through 
fuel savings within 18 to 24 months, based on their assumptions about 
future fuel costs. In other words they would treat this as a necessary 
condition, but generally would not consider it to be sufficient. In 
these cases, an operator may first conduct a detailed paper study of 
anticipated costs and benefits. If that study shows likely payback in 
18 to 24 months for their business, the fleet may acquire one or 
several tractors with the technology to directly measure fuel savings, 
costs and driver acceptance for their fleet. Small fleets may not have 
resources to conduct assessments to this degree and may rely on 
information from larger fleets or observations of widespread acceptance 
of the technology within the industry before adopting a technology. 
This uncertainty over the actual fuel savings and costs and the lengthy 
process to assess technologies significantly slows the pace at which 
fuel efficiency technologies are adopted.
    The agencies believe that using the two baselines addresses the 
uncertainties we have identified for tractors. The six-month payback 
period of Alternative 1b reflects the agencies' consideration of 
factors, discussed above, that could limit--yet not eliminate--
manufacturers' tendencies to voluntarily improve fuel consumption. In 
contrast, Alternative 1a reflects a baseline for vehicles other than 
trailers wherein manufacturers either do not apply fuel efficiency 
technologies or only apply them as a substitute for more expensive fuel 
efficiency technologies, except as necessitated by the Phase 1 fuel 
consumption and GHG standards.
    For HD pickups and vans, the agencies considered two No Action 
alternatives to cover a nominal range of

[[Page 73913]]

uncertainty. In Alternative 1b the agencies considered additional 
technology application, which involved the explicit estimation of the 
potential to add specific fuel-saving technologies to each specific 
vehicle model included in the agencies' HD pickup and van fleet 
analysis, as discussed in Section VI. Estimated technology application 
and corresponding impacts depend on the modeled inputs. Also, under 
this approach a manufacturer that has improved fuel consumption and GHG 
emissions enough to achieve compliance with the standards is assumed to 
apply further improvements, provided those improvements reduce fuel 
outlays by enough (within a specified amount of time, the payback 
period) to offset the additional costs to purchase the new vehicle. 
These calculations explicitly account for and respond to fuel prices, 
vehicle survival and mileage accumulation, and the cost and efficacy of 
available fuel-saving technologies. Therefore, all else being equal, 
more technology is applied when fuel prices are higher and/or 
technology is more cost-effective. However, considering factors 
discussed above that could limit manufacturers' tendency to voluntarily 
improve HD pickup and van fuel consumption, Alternative 1b applies a 6-
month payback period. In contrast, for Alternative 1a, the agencies 
project that fuel-saving technologies will either not be applied or 
only be applied as a substitute for more expensive fuel efficiency 
technologies, except as necessitated by the Phase 1 fuel consumption 
and GHG standards. The Method A sensitivity analysis presented in 
Section VI of the NPRM also examined other payback periods. In terms of 
impacts under reference case fuel prices, the payback period input 
plays a more significant role under the No-Action Alternatives (defined 
by a continuation of model year 2018 standards) than under the more 
stringent regulatory alternatives for HD pickups and vans described 
next.
(2) Alternative 2: Less Stringent Than the Preferred Alternative
    For vocational vehicles and combination tractor-trailers, 
Alternative 2 represents a stringency level which is approximately half 
as stringent overall as the final standards. The agencies developed 
Alternative 2 to consider a continuation of the Phase 1 approach of 
applying off-the-shelf technologies rather than requiring the 
development of new technologies or fundamental improvements to existing 
technologies. For tractors and vocational vehicles, this also involved 
less integrated optimization of the vehicles and engines. Put another 
way, Alternative 2 is not technology-forcing.\942\ See, e.g., Sierra 
Club v. EPA, 325 F. 3d 374, 378 (D.C. Cir. 2003) (under a technology-
forcing provision, EPA ``must consider future advances in pollution 
control capability''); see also similar discussion in Husqvarna AB v. 
EPA, 254 F. 3d 195, 201 (D.C. Cir. 2001).
---------------------------------------------------------------------------

    \942\ As noted in Section I.C, in this context, the term 
``technology-forcing'' has a specific legal meaning and is used to 
distinguish standards that will effectively require manufacturers to 
develop new technologies (or to significantly improve technologies) 
from standards that can be met using off-the-shelf technology alone. 
Technology-forcing standards do not require manufacturers to use any 
specific technologies.
---------------------------------------------------------------------------

    The agencies' decisions regarding which technologies could be 
applied to comply with Alternative 2 considered not only the use of 
off-the shelf technologies, but also considered other factors, such as 
how broadly certain technologies fit in-use applications and regulatory 
structure. The resulting Alternative 2 could be met with fewer 
technologies and lower penetration rates than those the agencies 
project will be used to meet the final Phase 2 standards. Alternative 2 
is estimated to be achievable without the application of some 
technologies, at any level. These and other differences are described 
below by category. Overall, Alternative 2 for the final rules is 
conceptually similar to Alternative 2 in the NPRM. However, some 
changes have been made to reflect new information provided in public 
comments.
    The agencies project that Alternative 2 combination tractor 
standards could be met by applying lower adoption rates of the 
projected technologies for Alternative 3. This includes a projection of 
slightly lower per-technology effectiveness for Alternative 2 versus 3. 
Alternative 2 also assumes that there would be little optimization of 
combination tractor powertrains.
    The Alternative 2 for vocational vehicles assessed for these final 
rules does differ somewhat from the proposal because it reflects new 
duty cycles that weight idle emissions more heavily. The agencies 
project that the Alternative 2 vocational vehicle standard could be met 
without any use of strong hybrids or any other type of transmission 
technology. Rather, it could be met with off-the-shelf idle reduction 
technologies, low rolling resistance tires, and axle efficiency 
improvements.
    The Alternative 2 trailer standards would apply to only 53-foot dry 
and refrigerated box trailers and could be met through the use of less 
effective aerodynamic technologies and higher rolling resistance tires 
versus what the agencies projected could be used to meet Alternative 3 
(i.e., the final standards).
    As discussed above in Section VI, the HD pickup truck and van 
alternatives are characterized by an annual required percentage change 
(decrease) in the functions defining attribute-based targets for per-
mile fuel consumption and GHG emissions. Under the standards in each 
alternative, a manufacturer's fleet would, setting aside any changes in 
production mix, be required to achieve average fuel consumption/GHG 
levels that increase in stringency every year relative to the standard 
defined for MY 2018 (and held constant through 2020) that establishes 
fuel consumption/GHG targets for individual vehicles. A manufacturer's 
specific fuel consumption/GHG requirement is the sales-weighted average 
of the targets defined by the work-factor curve in each year. 
Therefore, although the alternatives involve steady increases in the 
functions defining the targets, stringency increases faced by any 
individual manufacturer may not be steady if changes in the 
manufacturer's product mix cause fluctuations in the average fuel 
consumption and GHG levels required of the manufacturer. See Section VI 
for additional discussion of this topic. Alternative 2 represents a 2.0 
percent annual improvement through 2025 in fuel consumption/GHG 
emissions relative to the work-factor curve in 2020. This would be 0.5 
percent less stringent per year compared to the standards of 
Alternative 3.
    For HD pickups and vans in the Method A analysis, NHTSA projects 
that most manufacturers could comply with the standards defining 
Alternative 2 by applying technologies similar to those that could be 
applied in order to comply with the Alternative 3 standards, but at 
lower application rates. In EPA's Method B analysis, the biggest 
technology difference EPA projects between Alternative 2 and the 
Alternative 3 final standards is that most manufacturers could meet the 
Alternative 2 standards without any use of stop-start or other mild or 
strong hybrid technologies.
    The agencies are not adopting standards reflecting Alternative 2 
for reasons of both policy and law. Technically feasible alternate 
standards are available that provide for greater emission reductions 
and reduced fuel consumption than provided under Alternative 2. These 
more stringent standards, which are being adopted, are feasible at 
reasonable cost, considering both per-vehicle and per-engine cost, 
cost-effectiveness, direct benefits to

[[Page 73914]]

consumers in the form of fuel savings, and lead time. Consequently, the 
agencies do not believe that the modest improvements in Alternative 2 
would be appropriate or otherwise reasonable under section 202(a)(1) 
and (2) of the Clean Air Act, or represent the ``maximum feasible 
improvement'' within the meaning of 49 U.S.C. 32902(k)(2).
(3) Alternative 3: Preferred Alternative and Final Standards
    The agencies are adopting Alternative 3 for HD engines, HD pickup 
trucks and vans, Class 2b through Class 8 vocational vehicles, Class 7 
and 8 combination tractors, and trailers. Details regarding modeling of 
this final program are included in Chapter 5 of the RIA. Note that 
Alternative 3 for the final rules differs from the Alternative 3 in the 
NPRM. The differences are largely in response to significant comments 
on the proposed rule. Although some aspects of the final Alternative 3 
are more aggressive than proposed (including adopting some aspects of 
the proposed Alternative 4), others are less aggressive. As a result of 
these changes, the preferred alternative in this final rule is 
projected to achieve more GHG emission reductions and more reductions 
of fuel consumption than the proposed alternative 4. See Section X.B 
below and RIA Chapter 5.
    Unlike the Phase 1 standards where the agencies projected that 
manufacturers could meet the Phase 1 standards with off-the-shelf 
technologies only, the agencies project that meeting the Alternative 3 
standards will require a combination of off-the-shelf technologies 
applied at higher market penetration rates and new technologies that 
are still in various stages of development and not yet in production. 
Although this alternative is technology-forcing, it must be kept in 
mind that the standards themselves are performance-based and thus do 
not mandate that any particular technology be used to meet the 
standards.\943\ The agencies recognize that there is some uncertainty 
in projecting costs and effectiveness for those technologies not yet 
available in the market, but we do not believe, as discussed 
comprehensively in Sections II, III, IV, V, and VI, that such 
uncertainty is sufficient to render Alternative 3 beyond the reasonable 
or maximum feasible level of stringency for each of the engine and 
vehicle categories covered by this program. Moreover, we have explained 
what steps will be needed to bring these technologies to the commercial 
market, and the lead time needed to do so. Given that nearly all of the 
final standards are performance-based rather than mandates of specific 
technologies, and given that the lead time for the most stringent 
standards in Alternative 3 is approximately 10 years, the agencies 
believe that the performance that is required by these stringency 
levels of Alternative 3 allows each manufacturer to choose to develop 
technology and apply it to their vehicles (and engines, where 
applicable) in a way that balances their unique business constraints 
and reflects their specific market position and customers' needs.\944\
---------------------------------------------------------------------------

    \943\ The one exception being design standards for certain non-
aero trailers.
    \944\ Those few standards that are design-based rather than 
performance based reflect comments indicating that performance-based 
flexibility would not be necessary or helpful for certain markets.
---------------------------------------------------------------------------

    We have described in detail above, and also in Chapter 2 of the 
RIA, the precise bases for each of these standards (that is, for each 
segment covered under the program). Sections II through VI of this 
Preamble provide comprehensive explanations of the agencies' assessment 
of the extent to which such standards could be met through the 
accelerated application of technologies and our reasons for concluding 
that the identified technologies for each of the vehicle and engine 
standards that constitute the updated Alternative 3 represent the 
maximum feasible (within the meaning of 49 U.S.C. 32902 (k)) and 
reasonable (for purposes of CAA section 202(a)(1) and (2)) based on all 
of the information available to the agencies at the time of this 
rulemaking. In particular, the agencies determined that many engine 
improvements could be achieved sooner than we projected in our NPRM 
analysis, some even sooner than projected as part of the Alternative 4 
analysis.
(4) Alternative 4: More Accelerated Than the Preferred Alternative in 
the NPRM
    As indicated by its description in the title above, Alternative 4 
represents standards that are effective on a more accelerated timeline 
in comparison to the timeline of in the proposed Alternative 3 
standards. This alternative is unchanged from Alternative 4 in the 
proposal. The agencies believe that reanalyzing the same Alternative 4 
provides a useful context for commenters who supported the proposed 
Alternative 4.
    In the NPRM, Alternatives 3 and 4 were both designed to achieve 
similar fuel efficiency and GHG emission levels in the long term but 
with Alternative 4 being accelerated in its implementation timeline. 
Specifically, Alternative 4 reflects the same or similar standard 
stringency levels as the proposed Alternative 3, but 3 years sooner (2 
years for heavy-duty pickups and vans), so that the final phase of the 
standards would occur in MY 2024, or (for heavy duty pickups and vans) 
2025.
    The agencies projected in the NPRM that meeting Alternative 4 
combination tractor standards would require applying initially higher 
adoption rates of the projected technologies for Alternative 3. This 
included a projection of slightly higher per-technology effectiveness 
for Alternative 4 versus 3. Alternative 4 also assumes that there would 
be more optimization of combination tractor powertrains and earlier 
market penetration of engine waste heat recovery systems.
    The agencies also projected that meeting the Alternative 4 
vocational vehicle standard would require earlier adoption rates of the 
same technology packages projected for Alternative 3.
    Meeting the Alternative 4 trailer standards would require earlier 
implementation of more effective aerodynamic technologies, including 
the use of aerodynamic skirts and boat tails. This would be in addition 
to implementing lower rolling resistance tires for nearly all trailers.
    HD pickup truck and van standards defining Alternative 4 represent 
a 3.5 percent annual improvement in fuel consumption and GHG emissions 
through 2025 relative to the work-factor curves in 2020. This would 
require earlier adoption of all the Alternative 3 technologies.
    As discussed above and in the feasibility discussions in Sections 
II-VI, we are adopting those elements of the proposed Alternative 4 
where we have determined them to be feasible in the lead time provided. 
However, the agencies have determined that it is unlikely that all 
elements of Alternative 4 could be achieved by 2024. In fact, the 
agencies can only project that the engine improvements and some tire 
improvements will be achievable on the Alternative 4 timeline. Thus, we 
do not believe these alternative standards to be feasible overall, and 
we are consequently unable to accurately estimate costs for them. The 
agencies received many comments supporting the Alternative 4 standards 
where the commenter noted they supported them because they would be 
``cost-effective'' based on the proposed analysis of costs. However, we 
do not consider this conclusion to be accurate. We do not believe the 
proposed analysis fully represents the costs for this alternative

[[Page 73915]]

because it included little additional costs related to pulling ahead 
the development of so many additional technologies. It also does not 
reflect any costs associated with a decrease in the in-use reliability 
and durability during the initial years of implementation. It does not 
reflect costs of design and deployment outside of normal design cycles, 
an example being the necessity of developing new engine platforms if 
WHR were to be applied at higher penetration rates by MY 2024. See RIA 
Chapter 2.7.5. As we have already noted, we did not find costs or cost-
effectiveness to be a significantly limiting factor in determining the 
stringency of the standards. Rather, we found that actual technological 
feasibility and lead time to be the more limiting factors. In this 
respect, we found Alternative 4 to provide insufficient lead time for 
any of the standards--engine, pickups and vans, vocational vehicles, 
tractors, and trailers.
(5) Alternative 5: Even More Stringent Standards With Less Lead-Time
    Alternative 5 represents even more stringent standards compared to 
Alternatives 3 and 4, as well as the same implementation timeline as 
Alternative 4. As discussed in the NPRM, and as repeated above and in 
the feasibility discussions in Sections II-VI, we are not adopting 
Alternative 5 because we cannot project that manufacturers can develop 
and introduce in sufficient quantities the technologies that could be 
used to meet Alternative 5 standards. No commenters provided any new 
information to refute this finding. We believe that for some or all of 
the categories, the Alternative 5 standards are simply technically 
infeasible within the lead time allowed. We have not fully estimated 
costs for this alternative for tractors and vocational vehicles because 
we believe that there would be such substantial additional costs 
related to pulling ahead the development of so many additional 
technologies that we cannot accurately predict these costs. (Indeed, 
how can cost estimates for an alternative which essentially cannot be 
done at all be realistic?) We also believe this alternative, if it 
could somehow be effectuated, would result in a decrease in the in-use 
reliability and durability of new heavy-duty vehicles and that we do 
not have the ability to accurately quantify the costs that would be 
associated with such problems. Instead, we merely note that costs would 
be significantly greater than the estimated costs for Alternative 3, 
assuming (against our view) that such standards would be feasible at 
all.

B. How do these alternatives compare in overall fuel consumption and 
GHG emissions reductions?

    The following tables compare the overall fuel consumption and GHG 
emissions reductions of each of the regulatory alternatives the 
agencies considered.
    Note that for tractors, trailers, pickups and vans the agencies 
compared overall fuel consumption and GHG emissions reductions relative 
to two different baselines, described above in the section on the No 
Action alternative. Therefore, for tractors, trailers, pickups and vans 
two results are listed; one relative to each baseline, namely 
Alternative 1a and Alternative 1b.
    Also note that the agencies analyzed pickup and van overall fuel 
consumption and emissions reductions and benefits and costs using the 
NHTSA's CAFE model (Method A). In addition, the agencies used EPA's 
MOVES model to estimate pickup and van fuel consumption and emissions 
and a cost methodology that applied vehicle costs in different model 
years (Method B). In both cases, the agencies used a version of the 
CAFE model to estimate average per vehicle cost, and this analysis 
extended through model year 2030.\945\ The agencies concluded that in 
these instances the choice of baseline and the choice of modeling 
approach (Method A versus Method B) did not impact the agencies' 
decision to finalize Alternative 3.
---------------------------------------------------------------------------

    \945\ Although the agencies have considered regulatory 
alternatives involving standards increasing in stringency through, 
at the latest, 2027, the agencies extended the CAFE modeling 
analysis through model year 2030 rather than model year 2027 in 
order to obtain more fully stabilized results given projected 
product cadence, multiyear planning, and application of earned 
credits.
---------------------------------------------------------------------------

    The agencies are finalizing a more stringent program than proposed, 
so that the preferred alternative for the FRM (Alternative 3) achieves 
greater reductions and net benefits than the proposed program would 
have. Moreover, because the agencies analyzed the same Alternative 4 
for the FRM as for the NPRM, the FRM preferred alternative also 
achieves greater reductions than Alternative 4 would have.
    The regulatory impact analysis (RIA) accompanying today's notice 
presents more detailed results of the agencies' analysis.
(1) Impacts Using Analysis Method A
    Table X-1 through Table X-4 summarize the key NHTSA estimates of 
the costs and benefit of the program using Method A. The first two 
tables show the costs and benefits using a 3 percent discount rate 
under both the flat and dynamic baselines. The third and fourth tables 
show the costs and benefits using a 7 percent discount rate for both 
baselines. Under all possible combinations of discount rate and 
baseline the net benefits from highest to lowest are as follows: 
Alternative 5; Alternative 3; Alternative 4; Alternative 2.

 Table X-1--MY 2018-2029 Lifetime Summary of Program Benefits and Costs, Discounted at 3% (Relative to Baseline
                                                 1a), Method A a
----------------------------------------------------------------------------------------------------------------
                 Vehicle segment                       Alt 2           Alt 3           Alt 4           Alt 5
----------------------------------------------------------------------------------------------------------------
                                   Discounted pre-tax fuel savings ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................            12.1            18.7            20.3            22.3
Vocational Vehicles.............................            13.5            25.5            23.6            34.6
Tractors/Trailers...............................            50.2           118.8           115.7           169.1
                                                 ---------------------------------------------------------------
    Total.......................................            75.7           163.0           159.6           225.9
----------------------------------------------------------------------------------------------------------------
                                  Discounted Total technology costs ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             3.1             6.8             8.2             9.9
Vocational Vehicles.............................             1.6             6.6             7.1             9.5
Tractors/Trailers...............................             9.0            11.0            11.6            26.8
                                                 ---------------------------------------------------------------

[[Page 73916]]

 
    Total.......................................            13.7            24.4            26.9            46.2
----------------------------------------------------------------------------------------------------------------
                               Discounted value of emissions reductions ($billon)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             3.4             5.3             5.7             6.3
Vocational Vehicles.............................             5.2             9.8             9.1            13.3
Tractors/Trailers...............................            21.9            50.9            50.9            73.4
                                                 ---------------------------------------------------------------
    Total.......................................            30.5            66.0            65.7            93.0
----------------------------------------------------------------------------------------------------------------
                                             Total costs ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             4.4             7.9             8.6            10.3
Vocational Vehicles.............................             2.4             7.3             8.8            11.3
Tractors/Trailers...............................            13.2            14.0            15.7            30.8
                                                 ---------------------------------------------------------------
    Total.......................................            20.0            29.2            33.1            52.4
----------------------------------------------------------------------------------------------------------------
                                            Total benefits ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................            18.1            28.1            30.4            33.3
Vocational Vehicles.............................            20.2            37.8            35.1            51.2
Tractors/Trailers...............................            78.1           179.8           176.5           255.5
                                                 ---------------------------------------------------------------
    Total.......................................           114.1           245.7           242.0           340.0
----------------------------------------------------------------------------------------------------------------
                                             Net benefits ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................            13.7            20.2            21.8            23.0
Vocational Vehicles.............................            17.8            30.5            26.3            39.9
Tractors/Trailers...............................            64.9           165.8           160.9           224.7
                                                 ---------------------------------------------------------------
    Total.......................................            94.1           216.5           208.9           287.6
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the less
  dynamic baseline, 1a, and more dynamic baseline, 1b, please see Section X.A.1.


Table X-2--MY 2018-2029 Lifetime Summary of Program Benefits and Costs, Discounted at 3% (Relative to Baseline 1
                                                 b), Method A a
----------------------------------------------------------------------------------------------------------------
                 Vehicle segment                       Alt 2           Alt 3           Alt 4           Alt 5
----------------------------------------------------------------------------------------------------------------
                                   Discounted pre-tax fuel savings ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................            10.7            17.4            19.5            21.9
Vocational Vehicles.............................            13.5            25.5            23.6            34.6
Tractors/Trailers...............................            37.6           106.2           103.1           156.5
                                                 ---------------------------------------------------------------
    Total.......................................            61.8           149.1           146.2           213.0
----------------------------------------------------------------------------------------------------------------
                                  Discounted Total technology costs ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             2.8             6.4             7.5             9.8
Vocational Vehicles.............................             1.6             6.6             7.1             9.5
Tractors/Trailers...............................             8.8            10.7            11.3            26.6
                                                 ---------------------------------------------------------------
    Total.......................................            13.2            23.7            25.9            45.9
----------------------------------------------------------------------------------------------------------------
                               Discounted value of emissions reductions ($billon)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             3.0             4.9             5.5             6.2
Vocational Vehicles.............................             5.2             9.8             9.1            13.3
Tractors/Trailers...............................            16.4            45.4            45.4            67.9
                                                 ---------------------------------------------------------------
    Total.......................................            24.6            60.1            60.0            87.4
----------------------------------------------------------------------------------------------------------------
                                             Total costs ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             4.0             7.4             8.6            10.0
Vocational Vehicles.............................             2.4             7.3             8.8            11.3

[[Page 73917]]

 
Tractors/Trailers...............................            12.9            13.8            15.5            30.6
                                                 ---------------------------------------------------------------
    Total.......................................            19.3            28.5            32.9            51.9
----------------------------------------------------------------------------------------------------------------
                                            Total benefits ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................            16.0            26.0            29.2            32.7
Vocational Vehicles.............................            20.2            37.8            35.1            51.2
Tractors/Trailers...............................            59.2           161.0           157.7           236.7
                                                 ---------------------------------------------------------------
    Total.......................................            95.4           224.8           222.0           320.6
----------------------------------------------------------------------------------------------------------------
                                             Net benefits ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................            12.0            18.6            20.6            22.7
Vocational Vehicles.............................            17.8            30.5            26.3            39.9
Tractors/Trailers...............................            46.3           147.2           142.2           206.1
                                                 ---------------------------------------------------------------
    Total.......................................            76.1           196.3           189.1           268.7
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the less
  dynamic baseline, 1a, and more dynamic baseline, 1b, please see Section X.A.1.


 Table X-3--MY 2018-2029 Lifetime Summary of Program Benefits and Costs, Discounted at 7% (Relative to Baseline
                                                 1a) Method A a
----------------------------------------------------------------------------------------------------------------
                 Vehicle segment                       Alt 2           Alt 3           Alt 4           Alt 5
----------------------------------------------------------------------------------------------------------------
                                   Discounted pre-tax fuel savings ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             7.1            10.9            11.9            13.0
Vocational Vehicles.............................             7.1            13.4            12.5            18.5
Tractors/Trailers...............................            26.6            62.7            61.8            90.7
                                                 ---------------------------------------------------------------
    Total.......................................            40.8            87.0            86.2           122.2
----------------------------------------------------------------------------------------------------------------
                                  Discounted Total technology costs ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             2.2             4.8             5.9             7.0
Vocational Vehicles.............................             1.1             4.4             4.8             6.5
Tractors/Trailers...............................             6.2             7.4             8.0            18.5
                                                 ---------------------------------------------------------------
    Total.......................................             9.5            16.6            18.7            32.0
----------------------------------------------------------------------------------------------------------------
                               Discounted value of emissions reductions ($billon)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             3.1             4.8             5.2             5.7
Vocational Vehicles.............................             4.2             7.8             7.3            10.7
Tractors/Trailers...............................            16.9            39.5            39.3            57.1
                                                 ---------------------------------------------------------------
    Total.......................................            24.2            52.1            51.8            73.5
----------------------------------------------------------------------------------------------------------------
                                             Total costs ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             3.0             5.5             6.1             7.3
Vocational Vehicles.............................             1.5             4.8             5.8             7.5
Tractors/Trailers...............................             8.5             9.2            10.2            20.7
                                                 ---------------------------------------------------------------
    Total.......................................            13.0            19.5            22.1            35.5
----------------------------------------------------------------------------------------------------------------
                                            Total benefits ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................            11.7            18.0            19.6            21.5
Vocational Vehicles.............................            12.1            22.6            21.1            31.0
Tractors/Trailers...............................            47.1           108.0           106.8           155.1
                                                 ---------------------------------------------------------------
    Total.......................................            70.9           148.6           147.5           207.6
----------------------------------------------------------------------------------------------------------------
                                             Net benefits ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             8.7            12.5            13.5            14.2

[[Page 73918]]

 
Vocational Vehicles.............................            10.6            17.8            15.3            23.5
Tractors/Trailers...............................            38.6            98.8            96.6           134.4
                                                 ---------------------------------------------------------------
    Total.......................................            58.0           129.1           125.4           172.1
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the less
  dynamic baseline, 1a, and more dynamic baseline, 1b, please see Section X.A.1.


 Table X-4--MY 2018-2029 Lifetime Summary of Program Benefits and Costs, Discounted at 7% (Relative to Baseline
                                                 1b), Method A a
----------------------------------------------------------------------------------------------------------------
                 Vehicle segment                       Alt 2           Alt 3           Alt 4           Alt 5
----------------------------------------------------------------------------------------------------------------
                                   Discounted pre-tax fuel savings ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             6.3            10.1            11.5            12.9
Vocational Vehicles.............................             7.1            13.4            12.5            18.5
Tractors/Trailers...............................            19.9            56.1            55.2            84.1
                                                 ---------------------------------------------------------------
    Total.......................................            33.3            79.6            79.2           115.5
----------------------------------------------------------------------------------------------------------------
                                  Discounted Total technology costs ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             2.0             4.4             5.3             7.0
Vocational Vehicles.............................             1.1             4.4             4.8             6.5
Tractors/Trailers...............................             6.1             7.3             7.8            18.4
                                                 ---------------------------------------------------------------
    Total.......................................             9.2            16.1            17.9            31.9
----------------------------------------------------------------------------------------------------------------
                               Discounted value of emissions reductions ($billon)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             2.7             4.4             5.0             5.6
Vocational Vehicles.............................             4.2             7.8             7.3            10.7
Tractors/Trailers...............................            12.7            35.3            35.1            52.8
                                                 ---------------------------------------------------------------
    Total.......................................            19.6            47.5            47.4            68.2
----------------------------------------------------------------------------------------------------------------
                                             Total costs ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             2.7             5.1             6.0             7.1
Vocational Vehicles.............................             1.6             4.8             5.8             7.5
Tractors/Trailers...............................             8.4             9.0            10.1            20.6
                                                 ---------------------------------------------------------------
    Total.......................................            12.7            18.9            21.9            35.2
----------------------------------------------------------------------------------------------------------------
                                            Total benefits ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................            10.4            16.7            19.0            21.3
Vocational Vehicles.............................            12.1            22.7            21.1            31.0
Tractors/Trailers...............................            35.9            96.8            95.6           143.9
                                                 ---------------------------------------------------------------
    Total.......................................            58.4           136.2           135.7           195.2
----------------------------------------------------------------------------------------------------------------
                                             Net benefits ($billion)
----------------------------------------------------------------------------------------------------------------
HD pickups and Vans.............................             7.7            11.6            13.0            14.2
Vocational Vehicles.............................            10.5            17.9            15.3            23.5
Tractors/Trailers...............................            27.5            87.8            85.5           123.3
                                                 ---------------------------------------------------------------
    Total.......................................            45.7           117.3           113.8           161.0
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the less
  dynamic baseline, 1a, and more dynamic baseline, 1b, please see Section X.A.1.

    Table X-5 and Table X-6 show the estimated fuel savings and GHG 
reductions considering alternatives under both baselines. Under both 
baselines, the reductions in both fuel and GHG's are highest under 
Alternative 5, higher under Alternative 3 than Alternative 4, and 
lowest under Alternative 2.

[[Page 73919]]



     Table X-5--MY 2018-2029 Lifetime Fuel Savings and GHG Emissions
   Reductions by Vehicle Segment, Relative to Baseline 1a, Method A a
------------------------------------------------------------------------
                                                          Upstream &
      MY 2018-2029 Total          Fuel reductions       downstream GHG
                                 (billion gallons)     reductions (MMT)
------------------------------------------------------------------------
                              Alternative 2
------------------------------------------------------------------------
HD Pickup Trucks/Vans.........                  6.2                   77
Vocational Vehicles...........                  6.5                   86
Tractors and Trailers.........                 23.4                  323
                               -----------------------------------------
    Total.....................                 36.1                  486
------------------------------------------------------------------------
                      Alt. 3--Preferred Alternative
------------------------------------------------------------------------
HD Pickup Trucks/Vans.........                  9.8                  120
Vocational Vehicles...........                 12.3                  162
Tractors and Trailers.........                 55.6                  767
                               -----------------------------------------
    Total.....................                 77.7                 1049
------------------------------------------------------------------------
                                 Alt. 4
------------------------------------------------------------------------
HD Pickup Trucks/Vans.........                 10.6                  130
Vocational Vehicles...........                 11.4                  150
Tractors and Trailers.........                 54.0                  744
                               -----------------------------------------
    Total.....................                 76.0                 1024
------------------------------------------------------------------------
                                 Alt. 5
------------------------------------------------------------------------
HD Pickup Trucks/Vans.........                 11.6                  143
Vocational Vehicles...........                 16.7                  219
Tractors and Trailers.........                 78.8                 1087
                               -----------------------------------------
    Total.....................                107.1                 1449
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see
  Preamble Section I.D; for an explanation of the flat baseline, 1a, and
  dynamic baseline, 1b, please see Preamble Section X.A.1.


     Table X-6--MY 2018-2029 Lifetime Fuel Savings and GHG Emissions
    Reductions by Vehicle Segment, Relative to Baseline 1b Method A a
------------------------------------------------------------------------
                                                          Upstream &
      MY 2018-2029 Total          Fuel reductions       downstream GHG
                                 (billion gallons)     reductions (MMT)
------------------------------------------------------------------------
                              Alternative 2
------------------------------------------------------------------------
HD Pickup Trucks/Vans.........                  5.5                   68
Vocational Vehicles...........                  6.5                   86
Tractors and Trailers.........                 17.5                  242
                               -----------------------------------------
    Total.....................                 29.5                  396
------------------------------------------------------------------------
                      Alt. 3--Preferred Alternative
------------------------------------------------------------------------
HD Pickup Trucks/Vans.........                  9.0                  111
Vocational Vehicles...........                 12.4                  162
Tractors and Trailers.........                 49.7                  685
                               -----------------------------------------
    Total.....................                 71.1                  958
------------------------------------------------------------------------
                                 Alt. 4
------------------------------------------------------------------------
HD Pickup Trucks/Vans.........                 10.1                  125
Vocational Vehicles...........                 11.4                  150
Tractors and Trailers.........                 48.1                  663
                               -----------------------------------------
    Total.....................                 69.6                  938
------------------------------------------------------------------------

[[Page 73920]]

 
                                 Alt. 5
------------------------------------------------------------------------
HD Pickup Trucks/Vans.........                 11.3                  140
Vocational Vehicles...........                 16.7                  219
Tractors and Trailers.........                 72.9                 1006
                               -----------------------------------------
    Total.....................                100.9                 1365
------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see
  Preamble Section I.D; for an explanation of the flat baseline, 1a, and
  dynamic baseline, 1b, please see Preamble Section X.A.1.


  Table X-7--Annual GHG and Fuel Reductions Relative to the Dynamic Baseline in 2040 and 2050 Using Method A a
----------------------------------------------------------------------------------------------------------------
                                                     Upstream & downstream GHG       Fuel reductions (billion
                                                      Reductions (MMT CO2EQ)                 gallons)
                                                 ---------------------------------------------------------------
                                                       2040            2050            2040            2050
----------------------------------------------------------------------------------------------------------------
Alt. 2 Less Stringent--Total....................            49.1            57.3             3.6             4.2
    Tractors and Trailers.......................            30.9            36.6             2.2             2.7
    HD Pickups & Vans...........................             6.7             7.3             0.6             0.6
    Vocational Vehicles.........................            11.5            13.4             0.8             0.9
Alt. 3 Preferred--Total.........................             139             166            10.2            12.3
    Tractors and Trailers.......................             102             124             7.4             9.0
    HD Pickups & Vans...........................            12.6            13.8             1.0             1.2
    Vocational Vehicles.........................            24.1            28.2             1.8             2.1
Alt. 4 Less Lead Time--Total....................             116             136             8.6            10.1
    Tractors and Trailers.......................            83.1            98.7             6.0             7.2
    HD Pickups & Vans...........................            12.6            13.8             1.1             1.2
    Vocational Vehicles.........................            20.0            23.1             1.5             1.7
Alt. 5 More Stringent--Total....................             167             194            12.4            14.2
    Tractors and Trailers.......................             124             146             9.0            10.6
    HD Pickups & Vans...........................            14.8            16.2             1.3             1.3
    Vocational Vehicles.........................            27.8            32.0             2.1             2.3
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


    Table X-8--Annual GHG and Fuel Reductions Relative to the Flat Baseline in 2040 and 2050 Using Method A a
----------------------------------------------------------------------------------------------------------------
                                                     Upstream & downstream GHG       Fuel reductions (billion
                                                      Reductions (MMT CO2EQ)                 gallons)
                                                 ---------------------------------------------------------------
                                                       2040            2050            2040            2050
----------------------------------------------------------------------------------------------------------------
Alt. 2 Less Stringent--Total....................            63.7            75.2             4.7             5.5
    Tractors and Trailers.......................            44.2            53.0             3.2             3.8
    HD Pickups & Vans...........................             8.0             8.8             0.6             0.7
    Vocational Vehicles.........................            11.5            13.4             0.9             1.0
Alt. 3 Preferred--Total.........................             153             184            11.3            13.7
    Tractors and Trailers.......................             115             141             8.4            10.2
    HD Pickups & Vans...........................            13.8            15.1             1.1             1.3
    Vocational Vehicles.........................            24.1            28.2             1.8             2.2
Alt. 4 Less Lead Time--Total....................             131             153             9.6            11.4
    Tractors and Trailers.......................            96.5             115             7.0             8.3
    HD Pickups & Vans...........................            14.0            15.3             1.1             1.3
    Vocational Vehicles.........................            20.0            23.1             1.5             1.8
Alt. 5 More Stringent--Total....................             181             213            13.4            15.6
    Tractors and Trailers.......................             137             163             9.9            11.8
    HD Pickups & Vans...........................            16.0            17.6             1.4             1.5
    Vocational Vehicles.........................            27.8            32.0             2.1             2.3
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.


[[Page 73921]]

(2) Impacts Using Analysis Method B
    Table X-9 summarizes EPA's estimates of GHG and fuel reductions of 
the program using Method B for calendar years 2040 and 2050.

    Table X-9--Annual GHG and Fuel Reductions Relative to the Flat Baseline in 2040 and 2050 Using Method B a
----------------------------------------------------------------------------------------------------------------
                                                     Upstream & downstream GHG       Fuel reductions (billion
                                                      Reductions (MMT CO2EQ)                 gallons)
                                                 ---------------------------------------------------------------
                                                       2040            2050            2040            2050
----------------------------------------------------------------------------------------------------------------
Alt. 2 Less Stringent--Total....................            71.8            84.0             5.4             6.3
    Tractors and Trailers.......................            44.2            53.0             3.2             3.8
    HD Pickups & Vans...........................            16.1            17.6             1.4             1.5
    Vocational Vehicles.........................            11.5            13.4             0.9             1.0
Alt. 3 Preferred--Total.........................           166.5           198.9            12.5            14.9
    Tractors and Trailers.......................           115.5           140.7             8.4            10.2
    HD Pickups & Vans...........................            26.9            30.0             2.2             2.6
    Vocational Vehicles.........................            24.1            28.2             1.9             2.1
Alt. 4 More Stringent--Total....................           144.1           168.5            10.9            12.7
    Tractors and Trailers.......................            96.5           115.1             7.0             8.3
    HD Pickups & Vans...........................            27.7            30.3             2.3             2.6
    Vocational Vehicles.........................            20.0            23.1             1.5             1.8
Alt. 5 More Stringent--Total....................           196.8           230.0            14.8            17.2
    Tractors and Trailers.......................           136.9           162.9             9.9            11.8
    HD Pickups & Vans...........................            32.2            35.2             2.7             3.0
    Vocational Vehicles.........................            27.8            32.0             2.1             2.4
----------------------------------------------------------------------------------------------------------------
Note:
\a\ For an explanation of analytical Methods A and B, please see Section I.D; for an explanation of the flat
  baseline, 1a, and dynamic baseline, 1b, please see Section X.A.1.

XI. Natural Gas Vehicles and Engines

    NGV America estimates that approximately 65,200 natural gas trucks 
were operating in the U.S. in 2014. This represents 0.3 percent of the 
heavy-duty vehicle fleet in the U.S. based on EPA's estimated 17.5 
million heavy-duty trucks operating in the U.S.946 947 While 
medium and heavy-duty natural gas vehicles continue to be produced and 
sold, the collapse of crude oil prices starting in 2014 has reduced the 
economic incentive to expand the use of natural gas fueled trucks. 
Although these natural gas versions are similar in many ways to their 
petroleum counterparts, there are significant differences. There are 
also both similarities and differences in the production and 
distribution of natural gas relative to gasoline and diesel fuel.
---------------------------------------------------------------------------

    \946\ Yborra, Stephe; NGV Market Briefing to EPA and NHTSA, 
August 12, 2014.
    \947\ MOVES2014; http://www3.epa.gov/otaq/models/moves/index.htm.
---------------------------------------------------------------------------

    This combined rulemaking by EPA and NHTSA is designed to regulate 
two separate characteristics of heavy-duty vehicles: Emissions of GHGs 
and fuel consumption (especially petroleum fuels). The use of natural 
gas as a heavy-duty fuel can impact both of these. In the case of 
diesel or gasoline powered vehicles, there is a close relationship 
between GHG emissions and petroleum consumption. The situation is 
different for non-petroleum fuels like natural gas. Natural gas also 
has a lower carbon content than petroleum fuels. Thus, a natural gas 
vehicle that could achieve the same fuel efficiency as a diesel-powered 
vehicle would emit about 20 percent less CO2 when operating 
on natural gas and consume no petroleum. A natural gas vehicle with the 
same fuel efficiency as a gasoline vehicle would emit about 30 percent 
less CO2.\948\ However, current natural gas engines are 5 to 
15 percent less energy efficient than diesel engines. This means that, 
although natural gas engines are typically less fuel efficient, they 
can have lower CO2 emissions and consume much less 
petroleum. In Phase 1, the agencies balanced these factors by applying 
the gasoline and diesel CO2 standards to natural gas engines 
based on the engine type of the natural gas engine. Fuel consumption 
for these vehicles is then calculated according to their tailpipe 
CO2 emissions. In essence, this applies a one-to-one 
relationship between fuel efficiency and tailpipe CO2 
emissions for all vehicles, including natural gas vehicles. The 
agencies determined that this approach would likely create a small 
balanced incentive for natural gas use. See 76 FR 57123; see also 77 FR 
51705 (August 24, 2012) and 77 FR 51500 (August 27, 2012) (EPA and 
NHTSA, respectively, further elaborating on basis for having Phase 1 
apply at the tailpipe only, including for alternative fueled vehicles); 
see also Delta Construction Co. v. EPA, 783 F. 3d 1291 (D.C. Cir. 2015) 
(dismissing challenge to Phase 1 GHG standards as being arbitrary for 
applying only on a tailpipe basis).
---------------------------------------------------------------------------

    \948\ Methane emissions above the heavy-duty 0.1 g/bhp-hr 
methane tailpipe standard must be accounted for and offsets the 
lower CO2 tailpipe emissions.
---------------------------------------------------------------------------

    For Phase 2, the agencies have reevaluated the potential use of 
natural gas in the heavy-duty sector and the impacts of such use. As 
discussed below, based on our review of the literature and external 
projections we believe that the use of natural gas is unlikely to 
become a major fuel source for medium and heavy-duty vehicles during 
the Phase 2 time frame. Thus, since we project natural gas vehicles to 
have little impact on both overall GHG emissions and fuel consumption 
during the Phase 2 time frame, the agencies see no need to make 
fundamental changes to the Phase 1 approach for natural gas engines and 
vehicles.
    As part of this rulemaking, the agencies developed a lifecycle 
analysis of natural gas used by the heavy-duty truck sector, which is 
presented in Section XI.B. We also present the results of analyses 
projecting the future use of natural gas by heavy-duty trucks, identify 
a number of potential emission control technologies, and discuss the

[[Page 73922]]

approaches that could help to reduce the methane emissions from natural 
gas trucks in the future. A more detailed discussion of these analyses 
and issues can be found in RIA Chapter 13.

A. Natural Gas Engine and Vehicle Technology

    Both gasoline and diesel vehicles can be designed or modified to 
use natural gas. Several engine parameters and characteristics come 
into play in comparing engines powered by natural gas with engines 
powered by conventional fuels.
    Gasoline-fueled engines are typically spark-ignition engines that 
rely on stoichiometric combustion, which means that essentially all the 
oxygen from the engine's intake air is consumed in the combustion 
process. Converting a gasoline-fueled engine to run on natural gas 
involves changing the hardware used to store and deliver fuel to the 
engine, but the combustion strategy remains largely unchanged. The 
engine must be recalibrated for the different fuel properties, but 
combustion typically remains stoichiometric. In addition, the catalysts 
may require significant changes to enable the heavy-duty engine to 
comply with the emission standards.
    Diesel-fueled engines are compression-ignition engines that rely on 
lean-burn combustion, which means that the engine takes in a 
substantial quantity of excess air (oxygen) that is not consumed in the 
combustion process. Engines usually have turbochargers to compress the 
intake air, which allows for greater power output and thermodynamic 
efficiency. Converting a diesel-fueled engine to run on natural gas may 
involve a minimal set of changes to engine calibrations to maintain 
lean-burn operation and the overall operating characteristics of a 
compression-ignition engine, although there are substantial changes to 
the fuel storage and delivery systems. Compressed ignition natural gas 
engines either require the use of a pilot injection of a small amount 
of diesel fuel to initiate the combustion event when the natural gas is 
directly injected, or more commonly, a mixture (never more than 50 
percent natural gas) of natural gas and diesel fuel is combusted for 
fumigated natural gas engines. It is also possible to convert a diesel-
fueled engine to run on natural gas by adding a spark plug. The option 
of changing the calibration strategy to rely on stoichiometric 
combustion would allow for simpler engine design and operation, but it 
would come at a cost of higher fuel consumption and CO2 
emissions.
    Engines running on natural gas are capable of meeting the same 
criteria and GHG emission standards that apply for gasoline and diesel 
engines, although complying with the methane tailpipe emission standard 
has posed a challenge for engine manufacturers up to this point. In the 
case of reducing PM and CO2 emissions, there is an inherent 
advantage for natural gas. In contrast, engines must be properly 
calibrated and maintained to avoid high emission rates for 
NOX, HC, and CO.
    On-vehicle fuel storage for natural gas is also an important design 
parameter. The most common method today is compressed natural gas 
(CNG), which involves storing the fuel as a gas at very high pressure 
(up to ~3600 psi) to increase the density of the fuel, although the 
fuel remains less dense than diesel fuel. Compared to diesel fuel, CNG 
increases vehicle weight (because of heavier high pressure fuel tanks) 
and generally reduces the range relative to gasoline or diesel 
vehicles. Nevertheless, CNG technology is readily available and does 
not involve big changes for operators. The alternative is to 
extensively cool the fuel so that it can be stored as liquefied natural 
gas (LNG) at a lower pressure, which involves more extensive hardware 
changes for managing the fuel as a cryogenic liquid. LNG fuel storage 
also involves a substantial weight increase, but LNG has a higher 
density than CNG so LNG vehicles can store much more fuel than CNG 
vehicles in the same volume. LNG technology is available for a limited 
number of truck models, mostly for line-haul service where range is a 
paramount consideration. The cryogenic fuel requires substantial 
changes in hardware and procedures for refueling stations and 
operators. An additional difference from CNG is that because LNG must 
be kept cool to prevent evaporation, significant losses will occur if a 
vehicle is not used frequently enough. For example, an LNG vehicle left 
parked over a period of multiple days will eventually vent the fuel to 
prevent tank failure, as the system takes on heat from the surrounding 
environment and the pressure increases.

B. GHG Lifecycle Analysis for Natural Gas Vehicles

    This section is organized into three sections. The first section 
summarizes the upstream emissions associated with natural production 
and distribution. The second section summarizes the downstream 
emissions associated with the actual use of the fuel. The last section 
summarizes the results of the lifecycle emissions analysis and provides 
a comparison between natural gas lifecycle and diesel fuel lifecycle 
emissions. Only the overall results of the lifecycle emissions analysis 
between natural gas and diesel fuel are presented here, with more 
detail provided in Chapter 13 of the RIA.
(1) Upstream Emissions
    Upstream methane emissions (occurring in natural gas production, 
processing, transmission, storage and distribution) have been estimated 
and summarized in the annual EPA report Inventory of U.S. Greenhouse 
Gas Emissions and Sinks (GHG Inventory) for the United Nations 
Framework Convention on Climate Change (UNFCCC). As a basis for 
estimating the lifecycle impact of natural gas use by heavy-duty 
trucks, we used the year 2014 methane emission estimates in the most 
recent GHG Inventory, published in 2016. Substantial amounts of new 
information on methane emissions from oil and gas systems have become 
available recently from a number of channels, including EPA's GHG 
Reporting program, industry organizations, and various research 
studies. EPA reviewed this information and revised its estimates of 
methane emissions from natural gas and petroleum facilities for the 
2016 GHG Inventory. Comparing the most recent GHG Inventory estimate 
for 2013 to the previous GHG Inventory for 2013, methane emissions are 
about one third higher for the aggregated natural gas system than the 
previous estimate. The GHG Inventory also includes the quantity of 
carbon dioxide which is coproduced with methane throughout the natural 
gas system and emitted to the atmosphere through venting, flaring, and 
as fugitive emissions. Since the GHG Inventory only represents U.S.-
based methane and carbon dioxide emissions, it does not estimate the 
GHG emissions caused by the production of natural gas in Canada which 
is imported to the U.S. The imported Canadian natural gas comprises 
about 10 percent of U.S. natural gas consumption. To estimate the GHG 
emissions from this Canadian natural gas, we assume that it has the 
same GHG emissions profile as U.S.-produced natural gas.
    The GHG Inventory is updated annually to account for new emission 
sources (e.g., new natural gas wells), updated data, emission factors 
and/or methodologies, and to account for changes in emissions due to 
policy changes, regulatory changes and changes in industry practices. 
The GHG Inventory reflects emission reductions due to existing state 
regulations, National Emission Standards for Hazardous Air Pollutants 
(NESHAP)

[[Page 73923]]

promulgated by EPA in 1999,\949\ the New Source Performance Standards 
(NSPS) promulgated by EPA in 2012,\950\ and Natural Gas Star (a 
flexible, voluntary partnership that encourages oil and natural gas 
companies to adopt proven, cost-effective technologies and practices 
that improve operational efficiency and reduce methane emissions).\951\
---------------------------------------------------------------------------

    \949\ National Emission Standards for Hazardous Air Pollutants 
(NESHAP): For the Oil and Natural Gas Production and Natural Gas 
Transmission and Storage, Final Rule, 40 CFR part 63, subpart HH; 
June 17, 1999.
    \950\ Oil and Natural Gas Sector: New Source Performance 
Standards and National Emission Standards for Hazardous Air 
Pollutants Reviews; Final Rule, 40 CFR parts 60 and 63, 
Environmental Protection Agency, August 16, 2012.
    \951\ www3.epa.gov/gasstar/.
---------------------------------------------------------------------------

    Emission estimates in the GHG Inventory are generally bottom-up 
estimates which are per-unit (compressor, pneumatic valve, etc.) 
emission estimates based on measured or calculated emission rates from 
such emission sources.
    In addition to the national-level data available through the GHG 
Inventory, facility-level petroleum and natural gas systems data are 
also available through EPA's Greenhouse Gas Reporting Program 
(GHGRP).\952\ These data represent a significant step forward in 
understanding GHG emissions from this sector and EPA expects that it 
will be an important tool for the agency and the public to analyze 
emissions, and to understand emission trends. EPA is using GHGRP data 
to update emission estimates in the GHG inventory, and we plan to 
continue to leverage GHGRP data to update future GHG Inventories.
---------------------------------------------------------------------------

    \952\ See 40 CFR part 98, subparts PP and RR.
---------------------------------------------------------------------------

    The EPA-promulgated 2012 New Source Performance Standards (NSPS 
OOOO) will reduce emissions of ozone precursors from natural gas 
facilities and have methane and hazardous air pollutant reduction co-
benefits. The NSPS standards require that emissions from natural gas 
wells that are hydraulically fractured be controlled using flaring or 
reduced emission completion (REC) technology from completions and 
workovers starting in 2012. RECs used by natural gas well drillers 
capture the natural gas emissions that occur during well completion, 
instead of venting or flaring the emissions. Starting in January 2015, 
RECs are required for natural gas well completions and workovers. The 
NSPS also regulates the emissions from certain new natural gas 
production equipment, including dehydrator vents and condensate tanks.
    The Energy Information Administration (EIA) projects natural gas 
production to increase by about 19 percent by 2025. However, as noted 
in the 2016 Second Biennial Report of the United States of America, EPA 
projects emissions of methane to increase, by only 5 percent during 
this timeframe; thus, methane emissions in 2025 are expected to be 12 
percent lower than in 2014 per equivalent volume of natural gas being 
produced.
    EPA is taking additional steps to reduce the emissions of methane 
from natural gas and oil production facilities. On May 12, 2016, EPA 
finalized regulations (2016 NSPS OOOOa) which, among other things, 
include methane standards for oil and gas equipment used across the oil 
and gas sources currently only regulated for VOCs, and require the use 
of reduced emissions completions at hydraulically fractured oil 
wells.\953\ In March of 2016, the U.S. EPA and Canadian Environment and 
Climate Change Canada (ECCC) announced plans to regulate emissions from 
existing oil and gas sources.954 955 956 The goal of these 
various actions is to achieve an aggregated 40 to 45 percent reduction 
in methane emissions relative to methane emissions in 2012. The 
lifecycle analysis presented here and in RIA Chapter 13 attempts to 
represent GHG emissions in the year 2025, but probably overestimates 
those emissions because the analysis does not take into account the 
2016 NSPS, or any future action that would address existing sources.
---------------------------------------------------------------------------

    \953\ Oil and Natural Gas Sector: Emission Standards for New and 
Modified Sources; 40CFR 60, May 12, 2016.
    \954\ https://www.whitehouse.gov/the-press-office/2016/03/10/us-canada-joint-statement-climate-energy-and-arctic-leadership.
    \955\ https://blog.epa.gov/blog/2016/03/epa-taking-steps-to-cut-methane-emissions-from-existing-oil-and-gas-sources.
    \956\ Canada achieving methane emissions reductions from its 
natural gas sector is important to the US GHG footprint because 
about 10 percent of the natural gas consumed in the US is imported 
from Canada.
---------------------------------------------------------------------------

    In the GHG Inventory, emissions associated with powering the units 
or equipment (i.e., compressors, pumps) used in natural gas production, 
processing, transmission and distribution are aggregated with all the 
other fossil fuel combustion activities. Rather than attempt to 
disaggregate those specific GHG emissions from the rest of the process 
emissions in the GHG Inventory, we instead used the estimated emissions 
for these sources provided by GREET.
(2) Downstream Emissions
    Downstream emissions associated with natural gas differ between CNG 
and LNG. We discuss the emissions of both types below.
(a) Compressed Natural Gas (CNG)
    Natural gas used as CNG is compressed at the retail stations that 
sell the CNG and the fleet facilities which fuel the CNG fleet 
vehicles. Thus, it is typically off-loaded from the broader natural gas 
system where the vehicles using CNG are refueled. To get the natural 
gas to the CNG retail facilities, which are mostly located in or near 
urban areas, the natural gas is normally shipped through the 
distribution system downstream of the natural gas transmission system. 
CNG trucks are then refueled at the retail stations providing CNG. Each 
time a CNG refueling event occurs, a small amount of natural gas is 
released to the environment. We estimated the volume of CNG emitted by 
this equipment during refueling based on past data collected on these 
types of fueling fittings (described in RIA Chapter 13.1.2.1). Since 
CNG storage systems are designed handle very high pressures, they must 
be designed to have no leaks, so the CNG could remain stored in the CNG 
tanks indefinitely. However, should a leak occur, the very high 
pressure at which CNG is stored dramatically increases fugitive 
emissions. We do not have any data to suggest that fugitive emissions 
from CNG trucks and assume for this analysis that CNG fugitive 
emissions from CNG storage at retail/fleet facilities and by trucks is 
zero. However, we recognize that this clearly underestimates the 
methane emissions from these storage facilities since they are unlikely 
to be leak-free in every instance.
    Stored at 3600 psi the energy density of CNG is only about 25 
percent of the energy density of diesel fuel. This lower energy density 
is a disincentive for using CNG in long haul trucks because it limits 
the vehicle's range. However, as described in the Chapter 13.1.3.1 of 
the RIA, using an adsorbent for natural gas (ANG) could improve the 
energy density of CNG, which would make it a better candidate for 
natural gas storage for long range combination trucks.\957\ Or, if used 
to store CNG at the same density, could reduce the compression energy 
required to compress the CNG since it could be stored at a lower 
pressure.
---------------------------------------------------------------------------

    \957\ Menon, V.C., Komarneni, S. 1998 ``Porous Adsorbents for 
Vehicular Natural Gas Storage: A Review,'' Journal of Porous 
Materials 5, 43-58 (1998); Burchell, T ``Carbon Fiber Composite 
Adsorbent Media for Low Pressure Natural Gas Storage'' Oak Ridge 
National Laboratory.

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

[[Page 73924]]

(b) Liquefied Natural Gas (LNG)
    A primary reason for liquefying natural gas is that it allows 
storing the natural gas at about 60 percent of the density of diesel 
fuel, which is more than twice as dense as CNG. For this reason, LNG is 
a primary fuel being considered by long haul trucks.
    Liquefaction is the first step downstream of the natural gas 
production, processing and distribution system for making LNG available 
to trucks. This step involves cooling the natural gas until it 
undergoes a phase change from a gas to a liquid at a low pressure. LNG 
plants are configured differently depending on their ultimate capacity. 
Large LNG export facilities produce 5 million metric tons, or more, per 
year of LNG and the economy of scale of these large plants supports the 
significant addition of capital to reduce their operating costs and 
energy use. An LNG plant solely producing LNG for truck fuel would 
likely be significantly smaller (i.e., 0.1 million metric tons per 
year) and have a poorer economy of scale than the LNG export 
facilities. Their energy efficiency would be expected to be much lower 
on a percentage basis. The California Air Resources Board estimated 
that the liquefaction plants used for producing truck LNG fuel are 80 
percent efficient, compared to 90 percent efficient for LNG export 
facilities.\958\ In other words, the amount of energy used to liquefy 
the natural gas would be equivalent to the energy content 10 to 20 
percent of the natural gas coming into the facility. CARB recently 
conducted its lifecycle assessments for LNG assuming both 90 percent 
efficiency value as well as 80 percent efficiency due to the 
uncertainty of where the LNG would be sourced from (this assessment by 
CARB is solely for illustrative purposes--to qualify for credit under 
the Low Carbon Fuel Standard (LCFS), the actual LNG plant performance 
would need to be the basis for any submission for requesting credit 
under the LCFS). For this lifecycle analysis of LNG as a truck fuel, we 
assume that LNG plants are 80 percent efficient, which is consistent 
with the types of LNG plants that would be dedicated producers of LNG 
for transportation purposes. We also estimated the fugitive methane 
emissions at the plant, as well as carbon dioxide emissions emitted by 
the processes which liquefy the natural gas. Because LNG plants are 
located separate from the retail facilities, they can be located to 
access the lowest cost feedstock. This means the natural gas for LNG 
can be sourced from the larger natural gas transmission pipelines which 
are upstream of the distribution pipelines. Once the natural gas is 
liquefied at the liquefaction plant, it is stored in an insulated 
storage tank to keep the LNG liquefied.
---------------------------------------------------------------------------

    \958\ Detailed California-Modified GREET Pathway for Liquefied 
Natural Gas (LNG) from North American and Remote Natural Gas 
Sources, Version 1.0, California Air Resources Board, July 20, 2009.
---------------------------------------------------------------------------

    LNG is typically transported to the retail station using insulated 
trailers designed specifically for transporting LNG. Boil-off emissions 
can occur during transport, but only if the temperature of the LNG 
increases to the point the pressure relief valve opens. However, since 
the LNG is super cooled, boil off events are likely to be rare. LNG is 
also stored in an insulated storage tank at the retail facility. Heat 
gain in the storage tank could eventually lead to boil-off emissions. 
Service stations with little LNG demand are at a higher risk of boil-
off emissions compared to service stations which have a significant 
throughput volume. LNG stations could be configured to avoid boil-off 
events to the atmosphere, such as venting to a co-located CNG facility, 
venting to a nearby natural gas pipeline, or oxidizing the methane to 
carbon dioxide. In the absence of other information, we used CARB's 
estimate of boil-off emissions for LNG transportation by the tanker 
truck between the LNG plant and retail outlets and from LNG retail 
facilities.\959\
---------------------------------------------------------------------------

    \959\ Ibid.
---------------------------------------------------------------------------

    LNG vehicles generally refuel LNG retail outlets or fleet refueling 
facilities much the same as other vehicles. However, because the fuel 
is under pressure, when the refueling nozzle is disconnected from the 
LNG tank nozzle, a small amount of methane is released to the 
environment. We estimated the volume of LNG emitted by this equipment 
during refueling based on past data collected on these types of fueling 
fittings (described in RIA Chapter 13). In addition, operators 
sometimes reduce the pressure in the truck's LNG tank to speed up the 
refueling process, which can emit methane as well. In some cases the 
retail station is equipped with another hose and associated piping to 
vent the excess gas to the retail stations' storage tank where it would 
usually condense back to a liquid due to the lower temperature of that 
tank, or perhaps be vented to a natural gas pipeline. However, for 
those retail outlets without such vent lines to the storage tank, the 
operator may simply vent the truck's storage tank to the atmosphere. We 
estimated the emissions for a boil-off event or venting an LNG tank 
prior to refueling as part of a sensitivity analysis for our lifecycle 
analysis.
(c) Comparing CNG to LNG
    The differences between CNG and LNG refueling patterns are 
important. Only a single facility, the retail outlet, is required for 
distributing CNG, while LNG requires both a liquefaction plant and a 
retail outlet and a means for transporting the LNG from the 
liquefaction plant to retail. Relying on a single facility simplifies 
the logistics of providing CNG and reduces the opportunity for methane 
leakage to the environment. However, this emissions disadvantage of LNG 
compared to CNG is offset somewhat because LNG is expected to access 
natural gas from the upstream transmission system (due to lower 
prices), which avoids methane emissions associated with the downstream 
natural gas distribution system.
(d) Vehicle Emissions
    There are several different ways that diesel heavy-duty engines can 
be configured to use natural gas as a fuel. The first is a spark 
ignition (Otto cycle) natural gas (SING) engine. The SING heavy duty 
engine burns the fuel stoichiometrically and uses a three-way catalyst, 
and some also add an oxidation catalyst to provide the greatest 
emissions reduction. In this case the engine compression ratio is 
reduced similar to that of a gasoline engine and thus its thermal 
efficiency is lower than a diesel-like engine by about 10-15 percent.
    The second is a direct injection natural gas (DING), diesel cycle. 
The DING engine uses a small quantity of diesel fuel (pilot injection) 
or a glow plug as ignition sources. As the injection system for the 
diesel fuel does not have the capability of greater injection 
quantities, this option has no dual-fuel properties. On the other hand, 
an optimization of the pilot injection can be made to achieve lower 
emissions. An advanced high pressure direct injection (HPDI) fuel 
system combining the injection of both diesel fuel and natural gas can 
be used for lean burn combustion. This enables the engine to maintain 
the efficiency advantage of a compression ignition engine while running 
mainly CNG/LNG.
    The third is a mixed-fuel natural gas (MFNG), diesel cycle. In a 
mixed-fuel engine, natural gas is mixed with intake air before 
induction to the cylinder and diesel fuel is used as ignition source. 
Mixed-fuel vehicle/engine means any vehicle/engine engineered and 
designed to be operated on the original fuel(s), or a mixture of two or 
more fuels that are

[[Page 73925]]

combusted together. Engine results have shown that the efficiency of 
the engine could decrease by about 2-5 percent in mixed-fuel mode 
compared to diesel mode and that the diesel replacement was 
approximately 40-60 percent.
    Each of these natural gas engine types has its merits. The SING 
engine is less costly, but is less fuel efficient and because of the 
lower compression ratio it has less torque than the DING and MFNG 
diesel cycle engines. Furthermore, the SING engine usually is designed 
for a shorter lifespan. The DING engine is likely the most expensive 
because of the special natural gas/diesel fuel injection system and 
large required amount of natural gas (LNG or CNG) storage since the 
truck must run on natural gas. However, because the truck can run 
almost completely on natural gas, the DING engine has the potential to 
more quickly pay down the higher investment cost of the natural gas 
truck. The MFNG engine provides the truck owner the flexibility to 
operate either on both natural gas and diesel fuel, or solely on diesel 
fuel, but at the expense of a slower natural gas investment pay down 
rate because at most 60 percent of the fuel it consumes can be natural 
gas.
    Phase 1 set methane emission standards for both CNG and LNG trucks, 
so it is important to separate those trucks built before 2014 from 
those built in 2014 and later. The trucks built before 2014 only needed 
to meet standards for nonmethane hydrocarbon (NMHC) and other criteria 
pollutants, which means that the methane emissions from these trucks 
are unregulated. Our certification data show that the methane tailpipe 
emissions from these trucks/buses ranges from 2-5 g/bhp-hr for both 
spark ignition (gasoline type) and compression ignition (diesel type) 
engines.
    For 2014 and later, DING and MFNG natural gas trucks or natural gas 
conversions of 2014 and later diesel trucks, the trucks must meet a 0.1 
g/bhp-hr methane emission standard in the case of a larger truck engine 
tested with an engine dynamometer, and a 0.05 g/mile methane emission 
standard in the case of smaller trucks tested on a chassis 
dynamometer.\960\ For SING engines, the methane standards take effect 
in 2016.\961\ Natural gas truck manufacturers are allowed to offset 
methane emissions exceeding the methane emission standard by converting 
the methane emission exceedances into CO2 equivalent 
emissions and using CO2 credits. For the natural gas engine 
certifications that EPA received for 2014, 2015 and 2016, the truck 
manufactures chose to continue to emit high levels of methane (up to 2 
g/bhp-hr) and use carbon dioxide credits to offset those emissions. We 
do not know whether this practice will continue in the future; however, 
for evaluating the lifecycle impacts of natural gas heavy-duty trucks, 
we assume that natural gas trucks emit higher amounts of methane than 
the standard. It is worth noting that, because manufacturers have less 
experience controlling methane emissions, the potential exists for 
deterioration or malfunction of the engines, fuel supplies, or 
associated emission control devices on these trucks to occur in such a 
manner to result in higher methane emissions in actual use. We have not 
specifically accounted for the potential for increased methane 
emissions from high-emitter natural gas trucks.
---------------------------------------------------------------------------

    \960\ An exception is that small volume, heavy-duty natural gas 
truck manufacturers are exempt from EPA's GHG regulations.
    \961\ See 76 FR 57192, 40 CFR 1036.108(a)(2) and 1037.104(c) 
(which is proposed to be redesignated as 40 CFR 86.189-14(k)(5)).
---------------------------------------------------------------------------

    Some amount of combustion gases typically leaks into the crankcase 
across the piston rings (blow-by) These crankcase emissions generally 
include some unburned fuel along with other combustion products, and 
for natural gas engines, this includes methane. The crankcase of the 
spark ignition engines is vented into the intake of the engines; thus, 
any methane that ends up in the crankcase is rerouted back to the 
engine where it would be combusted. For compression ignition engines, 
however, the crankcase emissions are allowed to be vented into the 
exhaust pipe downstream of the aftertreatment devices, and therefore 
can be released to the atmosphere, provided the manufacturer measures 
them and includes them in the total emissions. This means that 
crankcase emissions of methane count against the Phase 1 methane 
standard. Another potential source of methane emissions from CNG and 
LNG trucks is fugitive emissions from the engine and from the piping 
which routes the fuel to the engine. Thus, either while parked or 
operated, this part of the vehicle fuel and engine systems could leak 
methane to the environment (which is different from boil-off emissions 
from LNG trucks discussed below). We do not have data nor did we 
develop an estimate for these potential fugitive emissions from these 
types of in-use leaks. If the natural gas vehicles are well maintained, 
these emissions are likely to be very low.
    The thermal efficiency (the ratio of energy converted to work 
versus energy consumed) of the natural gas engine also plays a role in 
the lifecycle emissions of the truck. Natural gas engines are generally 
less efficient than their gasoline and diesel counterparts. 
Furthermore, manufacturers often choose to produce spark-ignition 
stoichiometric natural gas engines for use in diesel applications. 
Spark-ignition natural gas engines can be as much as 15 percent less 
efficient than compressed ignition engines which operate on diesel 
fuel. In our lifecycle analysis, we provide two different sensitivities 
for natural gas vehicles assuming that they are 5 percent and 15 
percent less efficient.
    An important difference between CNG and LNG is the way in which the 
fuels are stored on the vehicle. The CNG is contained in a permanently 
sealed system while the LNG system is potentially open to the 
environment (depending on operating patterns). Provided that there are 
no leaks in the storage system, the CNG truck is inherently low (zero) 
emitting with respect to evaporative emission and a parked truck would 
contain the CNG indefinitely. However, this is not so for LNG trucks, 
which would have very high emissions if the truck were to be parked so 
long that its entire contents would boil off and be emitted to the 
environment. Methane venting emissions mean loss of fuel for the 
operator, which creates a disincentive to allow the fuel to warm to the 
point of venting. Nevertheless, even occasional venting events can have 
significant impacts. Thus, EPA remains concerned about boil-off 
emissions from LNG truck fuel storage systems. When the liquefied 
natural gas is pumped into the truck LNG tanks, it is ``supercooled,'' 
meaning that the pressure of the LNG is well below the pressure at 
which the natural gas vent valve would relieve the LNG pressure. If the 
truck is driven extensively, the drawdown of liquid level will reduce 
the pressure in in the storage tank which will cause some of the fuel 
to boil off and the heat of vaporization would thus cool the rest of 
the liquid in the LNG storage tank. It is possible that the fuel would 
maintain its supercooled temperature, or possibly even cool further 
below its supercooled temperature, the entire time until the LNG is 
completely consumed.
    Unless the truck is driven enough to consume the LNG fuel while is 
still at the very low-temperature and low-pressure, it will warm due to 
the ambient temperature gradient through the tank wall, and vaporize, 
causing the temperature and pressure of the LNG to rise. When the 
pressure reaches a maximum of 230 psi a safety release valve releases 
the methane gas to vent

[[Page 73926]]

excess pressure. There are two industry standards used to design tanks 
to reduce the temperature increase, one for a 3-day hold time \962\ and 
one for a 5-day hold time.\963\ Hold time is the time elapsed between 
the LNG refueling and venting.
---------------------------------------------------------------------------

    \962\ National Fire Protection Association 52, Compressed 
Natural Gas (CNG) Vehicular Fuel System Code, 2002 Edition.
    \963\ SAE International (2008) SAE J2343: Recommended Practice 
for LNG Medium and Heavy-Duty Powered Vehicles. Warrendale, 
Pennsylvania.
---------------------------------------------------------------------------

    A large amount of methane can be released with each boil-off event. 
If aware of the impending boil-off, such as when the truck is being 
maintained, the truck driver could hook up the LNG tank to a hose which 
would vent the natural gas emissions to a CNG system which could reuse 
the boil-off natural gas as CNG, or vent the natural gas emission to a 
natural gas pipeline. Otherwise the boil-off emission would simply vent 
to the atmosphere. If the truck had 200 gallons of LNG storage 
capacity, the estimated quantity of boil-off emissions would range from 
3 to 9 gallons of LNG for each boil-off event depending on the fill 
level of the LNG tank, assuming that the boil-off event results in a 
drop of pressure in the LNG tank from 230 psi to 170 psi. Each boil-off 
event has the potential to release on the order of 5,300-15,800 grams 
of CH4 which equates to 132-400 kilograms of CO2-
equivalent emissions, using a methane global warming potential (GWP) of 
25 (assessed over 100 years).\964\ If the vehicle continues to sit for 
five more days and boil-off events occur each day to several times per 
day as the tank vents and rebuilds in pressure, the sum total of the 
boil-off events can result in over a million grams of CO2-
equivalent emissions.
---------------------------------------------------------------------------

    \964\ See Section XI.D.(2)(a) for a discussion of different 
values for the GWP of methane.
---------------------------------------------------------------------------

(3) Results of Lifecycle Analysis
    To estimate the lifecycle impact of natural gas used by heavy-duty 
trucks, we totaled the estimated CO2, CH4 
N2O emissions for the upstream and downstream portions of 
the natural gas system. The methane and nitrous oxide emissions are 
converted to carbon dioxide-equivalent emissions using the appropriate 
GWP conversion factors. The GWP conversion factors EPA currently uses 
in this analysis are for a 100-year timeframe, are 25 and 298 for 
methane and nitrous oxide, respectively.\965\
---------------------------------------------------------------------------

    \965\ These global warming potential values are based on the 
Fourth Assessment Report authored by the Intergovernmental Panel on 
Climate Change.
---------------------------------------------------------------------------

    To establish the impacts of natural gas use in the heavy-duty 
fleet, it was necessary to compare the lifecycle impacts of natural gas 
against the base fuel it is replacing, which generally is diesel fuel. 
The lifecycle impact of diesel fuel was estimated by the 2015 GREET 
model for the current production and use of diesel fuel. In 2015, the 
National Energy Technology Laboratory (NETL) updated its diesel fuel 
lifecycle analysis to assess diesel fuel use by trucks in the year 
2014.\966\ The revised analysis shows much higher upstream emissions 
compared to GREET, but much lower truck GHG emission compared to GREET, 
and on balance is slightly lower than GREET. Thus, if we used the NETL 
lifecycle analysis, on a relative basis, natural gas trucks would 
appear slightly higher emitting than diesel engines.
---------------------------------------------------------------------------

    \966\ Cooney, Greg of Booze Allen Hamilton; Approaches to 
Developing a Cradle-to-Grave Lifecycle Analysis of Conventional 
Petroleum Fuels Produced in the U.S. with an Outlook to 2040; for 
the National Energy Technology Laboratory (NETL), October 6, 2015.
---------------------------------------------------------------------------

    To illustrate the relative full lifecycle impact of natural gas-
fueled heavy-duty vehicles compared to diesel fueled heavy-duty 
vehicles, we assessed two different scenarios. The first is a 
conversion of a 2014 or later diesel engine to use CNG. Of the tens of 
thousands of heavy-duty natural gas trucks currently in use, most are 
of this type. It is likely that nearly all CNG conversions being done 
in 2021 and later will be for vehicles subject to the 2014 and 2016 
methane emissions standards. Thus, for this analysis we assume that all 
converted natural gas trucks will need to comply with the methane 
standards. The methane standard requires heavy-duty trucks to comply 
with a 0.1 g/bhp-hr or a 0.05 g/mile methane tailpipe standard. Based 
on certification data for post-2014 CNG trucks, the trucks emit from 
0.7 to 2 g/bhp-hr methane and thus require the use of CO2 
emission credits to show compliance with the methane standard. For the 
purposes of this review, we assume that these trucks emit 1 gram of 
methane per brake horsepower hour. We provide two sensitivities to 
capture the lower thermal efficiencies of natural gas trucks: 5 percent 
less thermally efficient (thermal high) which is representative of a 
diesel cycle engine and 15 percent less energy efficient (thermal low, 
which is 10 percent worse thermal efficiency than the 5 percent less 
thermally efficient case) which is representative of a gasoline cycle 
engine.
    The second scenario we assessed is a combination LNG tractor 
trailer (LNG is most common with tractors because it provides a greater 
range of operation). While the fuel storage in this case is LNG (as 
opposed to CNG in the case above), the engine options are similar to 
the above case (diesel and gasoline cycle as represented by the thermal 
efficiency sensitivities). Also similar to the CNG case, we assume that 
these engines continue to emit 1 gram per brake-horsepower-hour of 
methane despite being subjected to either the 0.1 gram per brake 
horsepower-hour or the 0.05 gram per mile methane emission standard. We 
make two different assumptions with respect to refueling and boil off 
emissions. In the LNG average case, we assume a modest quantity of 
refueling and boil-off methane emissions as estimated by GREET. The 
second boil-off emission estimate is a sensitivity analysis which 
assumes that the LNG storage tank is either vented to the atmosphere 
each time the driver refills his tank, or that there is a boil-off 
event for each LNG tank filling. As discussed above, we do not expect 
such high refueling and boil-off emissions to be common practices for 
newer trucks that are operated regularly. However, as the use of these 
trucks decreases as they age and are sold into the secondary market, 
the risk for refueling and boil-off emission events increases--this 
estimate provides a simple sensitivity emission estimate. The relative 
lifecycle analysis is shown in Figure XI-1.
    A third comparison made in Figure XI-1 is the relative tailpipe-
only emissions for diesel and natural gas trucks. The quantity of 
carbon dioxide, methane and nitrous oxide emissions from a diesel truck 
is from GREET. The carbon dioxide emissions from a natural gas-fueled 
truck is calculated and is based on the carbon-hydrogen content of 
methane. The methane emissions from a natural gas-fueled truck is based 
on natural gas truck certification data (and so does not include any 
methane emissions from the natural gas storage tanks onboard the truck 
nor other fugitive emissions).

[[Page 73927]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.038

    The first two bars of Figure XI-1 show that based solely on 
tailpipe emissions (with thermal efficiency adjustments and assuming 1 
g/bhp-hr methane emissions at the truck), CNG trucks are estimated to 
emit about 10 percent less GHG emissions than diesel engines if the 
engine is only 5 percent less efficient than a diesel engine, and about 
the same GHG emissions if the engine is 15 percent less efficient than 
a diesel engine. The four full lifecycle analyses represented by the 
right four bars in the figure show that CNG trucks are estimated to 
emit less GHG emissions than diesel trucks, although if their thermal 
efficiency is much lower (15 percent less than the diesel fueled 
engine) their GHG emissions would decrease to 5 percent lower than 
diesel trucks.
    Figure XI-1 also shows that LNG trucks with an average extent of 
boil-off emissions can have about the same greenhouse gas footprint as 
diesel trucks, provided the engines' energy efficiency is only 5 
percent lower than diesels. However, if the LNG engine is 15 percent 
less energy efficient than the diesel fuel engine, the GHG emissions of 
the LNG truck would be higher. In addition, an LNG truck with refueling 
or high boil-off emissions, would emit about one third more GHG 
emissions than diesel fuel trucks. From a lifecycle perspective, LNG 
trucks appear higher emitting than CNG trucks largely because of the 
low thermal efficiency of the small liquefaction facilities. If a fleet 
of LNG trucks were to access LNG from a large, LNG export facility, 
which are much more energy efficient than the smaller liquefaction 
facilities, the relative lifecycle impacts of the LNG trucks would be 
much better.
    It is important to point out the uncertainties associated with the 
lifecycle estimates provided in the above figures. As discussed above, 
there is uncertainty in both the upstream and downstream methane 
emission estimates for natural gas facilities and equipment, and the 
trucks that consume natural gas. There is also uncertainty in the 
diesel fuel lifecycle analysis conducted by GREET and NETL. Finally, 
the lifecycle analysis is sensitive to the GWP factor used to assess 
methane and nitrous oxide, and if a different GWP value were to be 
used, it would affect the relative lifecycle impact of natural gas 
relative to diesel in heavy-duty trucks (see Chapter 13.1.4 of the RIA 
for sensitivity analyses regarding upstream methane emissions and the 
use of different GWP factors).
    We compared our lifecycle emission estimates for natural gas, 
relative to diesel fuel, with the estimates provided by the California 
Air Resources Board (CARB) for its Low Carbon Fuel Standard (LCFS). For 
our emissions estimate used in the comparison we used the carbon 
dioxide-equivalent (CO2eq) emissions estimated for 2014 and 
later engines, which must comply with a methane tailpipe emissions 
standard, and assumed that the engine was 5 percent less thermally 
efficient than a comparable diesel engine. Both analyses used GWPs 
based on 100 year timescale (i.e., a GWP of 25 for methane and 298 for 
nitrous oxide).\967\ For the CARB emissions estimates, we used the 
estimates made for what CARB terms ``illustrative purposes'' using the 
values printed in the April 3, 2015 workshop handouts.\968\ CARB 
estimates that CNG engines emit 86 percent of the CO2eq 
emissions as a diesel truck using the EER-adjusted values which 
reflects 11 percent lower energy efficiency than a diesel truck. When 
we adjust our analysis to reflect a truck which is 11 percent less 
efficient than a diesel truck, our analysis estimates that CNG engines 
emit 89 percent of the CO2eq emissions as a diesel truck. An 
important reason why CARB estimates lower CNG truck GHG emissions than 
our analysis is that a much larger portion of the electricity used to 
compress natural gas is renewable in California than the rest of the 
country. Also, our analysis accounts for the recent improvements in the 
GHG Inventory which shows higher natural gas upstream emissions. Using 
the same assumption that natural gas trucks are 11 percent less 
efficiently, CARB estimates LNG engines emit about 94

[[Page 73928]]

percent of the CO2eq emissions. After adjusting our analysis 
to also assume that trucks are 11 percent less efficient, our natural 
gas lifecycle analysis estimates LNG trucks emit 106 percent of the 
CO2eq emissions as a diesel truck. The reasons why are LNG 
truck emission are so much higher than CARB's is because we assume that 
LNG liquefaction plants are only 80 percent efficient as opposed to 
CARB' assumption that LNG liquefaction plants are 90 percent efficient. 
Also CARB assumes no boil-off or venting emissions from LNG trucks and 
for this comparison, we used our more modest boil-off and venting 
assumption, as described above. Overall, our estimates seem to be 
consistent to those estimated by CARB when we account for the different 
assumptions used in the respective analyses.
---------------------------------------------------------------------------

    \967\ See Section XI.D.(2)(a) for a discussion of different 
values for the GWP of methane.
    \968\ CA-GREET 1.8b versus 2.0 CI Comparison Table, LCFS 
Workshop Handout, California Air Resources Board, April 3, 2015.
---------------------------------------------------------------------------

    The lifecycle analysis at proposal comparing the GHG impacts of 
natural gas versus diesel fuel use by heavy-duty trucks did receive 
some comments. Probably the most prevalent comment is that EPA was 
underestimating methane emissions from the upstream natural gas sector. 
As noted above, the analysis for this final rule increased the estimate 
of methane emissions from the upstream natural gas sector by about one 
third. Other comments suggested that the Agencies should find emissions 
data or estimate methane emissions from the potential methane emission 
points for which there was no data to make such an estimate in our 
lifecycle analysis. The final rule natural gas lifecycle analysis does 
make methane emission estimates at some of those likely methane 
emission points for which we did not have data, nor make any estimates. 
Some commenters stated that the natural gas lifecycle analysis should 
be dropped because a similar lifecycle analysis was not conducted for 
other alternative fuels. The agencies chose to do a natural gas 
lifecycle analysis because of some of the projections for a rapid 
transition of heavy-duty trucks to natural gas, and because of 
methane's potency as a greenhouse gas. Other comments are presented and 
discussed in Section 12.3 of the RTC.

C. Projected Use of LNG and CNG

    We reviewed several sources to estimate how much natural gas is 
currently being used and is projected to be used by heavy-duty trucks. 
Projections for this emerging technology range from 7 percent of new 
heavy-duty vehicle sales to over 40 percent by 2040. Large 
uncertainties exist even since the 2014 NAS First Report was 
written.\969\ We believe the EIA projections are the most credible for 
capturing recent trends, and for projecting future natural gas use by 
heavy-duty trucks. There are several factors that support this 
assessment.
---------------------------------------------------------------------------

    \969\ B. Tita, Slow Going for Natural-Gas Powered Trucks; Wall 
Street Journal, 8/26/2014.
---------------------------------------------------------------------------

    First, in its 2014 Annual Energy Outlook (AEO), EIA estimates that 
natural gas fueled 0.4 percent of the energy use of heavy-duty trucks 
in 2014. This estimate is consistent with the fraction of the heavy-
duty fleet which is fueled by natural gas as estimated by the 
industry.\970\
---------------------------------------------------------------------------

    \970\ NGV America estimates that there are 62,000 natural gas 
fueled heavy-duty trucks and buses operating in the U.S. out of a 
total of 17.5 million heavy-duty trucks and buses operating in the 
U.S., which equates to 0.4%.
---------------------------------------------------------------------------

    Second, the EIA projection is based on an economic analysis which 
considers the increased cost of manufacturing a natural gas truck over 
a diesel truck, the fuel savings for using natural gas instead of 
diesel fuel, and whether the payback time of the fuel savings against 
the increased truck cost would result in purchases of natural gas 
trucks. As part of this analysis, EIA assumes that lighter heavy-duty 
trucks would use CNG, which is a lower cost technology suited for the 
shorter driving distances for these trucks. The long haul trucks, 
however, require larger on-board stores of fuel to extend the driving 
range which is satisfied by storing the natural gas as a liquid. As 
noted earlier, LNG has about 60 percent of the energy density of diesel 
fuel, compared to CNG which has only 25 percent of the energy density 
of diesel fuel. To satisfy the long driving range of the long haul 
trucks, EIA assumed that they would use LNG rather than CNG. The 
assumptions used by EIA for conducting its economic analysis are 
reasonable.
    Third, EIA is one of the several organizations in the world which 
collects fuel pricing data and projects future fuel prices using a 
sophisticated modeling platform. One of the most important assumptions 
in projecting the future use of natural gas in the transportation 
sector is the relative price of natural gas to the price of diesel 
fuel. Thus, we started with the EIA methodology and updated the diesel 
and natural gas prices in our analysis using the most recent AEO 
projections.
    In 2015, the price of natural gas purchased by industrial users was 
less than $5 per million BTU. The price of crude oil has been volatile 
during 2015 as the Brent crude oil price started at about $50 per 
barrel, but decreased to under $30 per barrel, but now (Spring 2016) 
seems to be selling in the range of $30 to $40 dollars per barrel. EIA 
reported the average retail diesel fuel price in 2015 was about $2.70 
cents per gallon.\971\ When comparing the natural gas spot market price 
on a diesel equivalent basis to the diesel fuel price, it appears that 
natural gas is priced about one quarter of the diesel fuel price. 
However, if used as compressed natural gas, the natural gas must be 
distributed through smaller distribution pipeline system that exists in 
cities, which increases the price of the natural gas. Then the natural 
gas must be compressed and stored at a retail outlet, and then 
dispensed to CNG trucks. The estimated retail price of CNG is $2.29 on 
a diesel gallon equivalent (DGE) basis, or about $0.41 DGE less than 
diesel fuel. LNG plants are assumed to be located close to large 
transmission pipelines away from cities, thus, it is sourced from lower 
cost natural gas. However, for producing LNG, the natural gas must be 
liquefied, shipped to retail outlets, stored and then dispensed to LNG 
trucks. These steps add substantially to the price of the LNG and the 
estimated retail price of LNG is $2.71 DGE, or about the same as diesel 
fuel.
---------------------------------------------------------------------------

    \971\ Weekly Retail Gasoline and Diesel Prices (Including 
Taxes), EIA, www.eia.gov/dnav/pet/pet_pri_gnd_dcus_nus_a.htm.
---------------------------------------------------------------------------

    In its 2015 AEO projections, EIA estimates that crude oil prices in 
the upcoming years will increase slightly and are projected to reach 
$140/bbl in 2040. Natural gas prices are also expected to increase only 
slightly over this period.
    Fifth, the assumptions regarding payback used by EIA seemed 
reasonable. EIA projects that natural gas trucks begin to be purchased 
when the payback times are 4 years or less based on a survey conducted 
by the American Trucking Association. The 2014 NAS Phase 2 First Report 
cites the payback for the extra cost of natural gas trucks as 2 years, 
but other sources report a longer return closer to 4 years.\972\
---------------------------------------------------------------------------

    \972\ Early LNG Adopters Experience Mixed Results; Truck News, 
October 1, 2013.
---------------------------------------------------------------------------

    For many fleets, the perceived payback times are too long to be 
interested in purchasing natural gas trucks without subsidies to 
compensate for the higher purchase price. According to EIA data, half 
the natural gas consumption by cars and trucks is in California, a 
state that subsidizes the purchase price of natural gas vehicles, and 
also subsidizes the cost of natural gas dispensing stations. The Low 
Carbon Fuel Standard in place in California also incentivizes natural 
gas use because natural gas is considered to

[[Page 73929]]

cause less of an impact on the climate than petroleum-based gasoline 
and diesel fuel.\973\ The majority of the other half of the NG fleet 
resides in states which also subsidize the cost of motor vehicles using 
natural gas.
---------------------------------------------------------------------------

    \973\ CARB currently estimates for the LCFS that CNG and LNG 
trucks reduce GHG-equivalent emissions by 32% and 17%, respectively, 
compared to gasoline and diesel fuel. In August 2014, CARB proposed 
reducing the GHG-equivalent benefit of CNG and LNG trucks to 22% and 
3%, respectively, compared to gasoline and diesel fuel.
---------------------------------------------------------------------------

    Based on the EIA projections for crude oil and natural gas prices, 
the payback time of LNG trucks is expected to remain relatively long 
until sometime after 2030 when crude oil prices are projected to begin 
increasing and the diesel fuel price increases above $4 per gallon. 
Thus, natural gas use by heavy-duty trucks is not projected by EIA to 
increase above 1 percent of the heavy-duty fuel demand until after 
2030.
    Even when the apparent payback time for CNG and LNG trucks use is 
favorable to fleet owners, low fuel availability could still slow the 
transition to CNG and LNG. This is because CNG and LNG availability at 
service stations is currently 1 percent or less of the availability of 
gasoline and diesel fuel and therefore not available for most fleets. 
LNG availability is particularly challenging because in addition to an 
LNG service station, an LNG liquefaction plant would be needed as well.
    If the number of natural gas truck sales remains a small portion of 
the heavy-duty truck fleet, even if natural gas trucks emit either 
higher or lower greenhouse gas emissions than diesel fuel trucks, there 
would be little impact on overall greenhouse gas emissions. The low 
natural gas use by the heavy-duty sector during the Phase 2 timeframe 
will give us time to learn more about both upstream and downstream 
methane emissions to gain a better understanding of the lifecycle 
impacts of natural gas use by heavy-duty trucks. It will allow EPA more 
time to consider and put into place the best additional steps to 
further reduce upstream and downstream methane emissions which will 
improve the lifecycle impacts of natural gas use by heavy-duty trucks 
should the heavy duty truck fleet begin consuming natural gas in much 
larger quantities.

D. Natural Gas Emission Control Measures

    Although natural gas vehicles are already subject to evaporative 
emission standards, the increasing interest in using natural gas as a 
heavy-duty fuel has led industry to further investigate how to improve 
the overall emission performance of natural gas vehicles, especially 
with respect to reducing methane leaks.
(1) Control Measures
    As described in Section XII.A.3, EPA is adopting a 5 day hold time 
requirement for LNG fuel tanks to reduce venting emissions.
    As described in Section II., EPA is not adopting the proposed 
changes related to crankcase emission control from natural gas engines.
(2) Additional Natural Gas Requirements and Discussion
    The discussion below includes new and revised natural gas program 
requirements being finalized. It also address other topics for with the 
agencies are not taking any action at this time. We will continue to 
monitor the market growth of these vehicles and we plan to review the 
greenhouse gas emissions impacts at a future date when natural gas 
vehicles comprise a larger percentage of the overall heavy duty fleet.
(a) Changing Global Warming Potential Values in the Credit Program for 
CH4 (see also Preamble Section II.(D)(5)(b))
    The Phase 1 GHG rule included a compliance alternative allowing 
heavy-duty manufacturers and conversion companies to comply with the 
respective methane or nitrous oxide standards by means of over-
complying with CO2 standards (40 CFR 85.525). More 
specially, EPA allows manufacturers to use CO2 credits 
(generated from the same averaging set) to comply with the methane and 
nitrous oxide requirements after adjusting the CO2 emission 
credits based on the relative GHG equivalents. To establish the GHG 
equivalents used by the CO2 credits program, the Phase 1 
heavy-duty vehicle rulemaking incorporated the IPCC Fourth Assessment 
Report GWP values of 25 for CH4 and 298 for N2O, 
which are assessed over a 100 year lifetime. EPA is largely continuing 
this allowance for Phase 2.
    Since the Phase 1 rule was finalized, a new IPCC report has been 
released with new GWP estimates. EPA asked for comment on whether the 
methane GWP used to establish the GHG equivalency value for the 
CO2 Credit program should be updated to those established by 
IPCC in its Fifth Assessment Report (AR5). The IPCC AR5 presents four 
different potential values for the GWP of methane over a 100 year 
lifetime, ranging from 28 to 36. These values are the result of 
slightly different calculation methods. Therefore, we not only 
requested comment on whether to update the GWP for methane to that of 
the AR5, but also on which value to use from this report. The GWPs of 
28 and 30 are both a result of using a carbon cycle approach consistent 
with that used in the Fourth Assessment Report. This carbon cycle 
approach included a climate-carbon feedback when calculating the 
lifetime of a pulse of carbon dioxide emissions, but did not include 
any climate-carbon feedback when calculating the impacts of a pulse of 
non-CO2 greenhouse gas emissions. As the GWP is the ratio of 
the impact of a pulse of non-CO2 GHG emissions relative to a 
pulse of carbon dioxide emissions, a second approach was presented 
where the non-CO2 GHG pulse also included climate-carbon 
feedbacks. This second approach yields GWP values of 34 or 36. For the 
purposes of this rule, EPA is choosing the approach that includes 
climate-carbon feedbacks for both non-CO2 and CO2 
pulses, as the agency considers this the approach most likely to be 
adopted by the international scientific community in future assessments 
on the timescale of this rule. The IPCC presents the value of 34 as the 
default value for the methane GWP, but also reports a value of 36 for 
``fossil'' methane to take into account the atmospheric CO2 
that would result from the oxidation of methane in the atmosphere.
    We received a number of comments on this issue. For the most part, 
the environmental community favored using the more recent GWP value and 
even some commented that EPA should use a methane GWP based on a 20 
year timeframe. On the other hand, the natural gas industry and natural 
gas truck manufacturers commented that EPA should not update to the 
newer GWP values but continue to use the methane GWP value from the AR4 
IPCC report because EPA is still using the methane GWP from the AR4 
today in other contexts. Although EPA is currently using AR4 values in 
other contexts, it is unlikely that EPA will still be using AR4 values 
in 2021 when the Phase 2 requirements begin. Thus, comments opposing 
the use the methane GWP from the later IPCC report are not persuasive. 
EPA will continue to base the credit adjustment on a 100 year timescale 
because it seems to best balance short-term versus long-term effects of 
climate change.
    Of the possible 100 year methane GWP values presented in the IPCC 
AR5 report, EPA is choosing to use the value of 34 because it is the 
primary value presented by the IPCC and because the approach of not 
accounting for the CO2 oxidation product within the GWP for

[[Page 73930]]

methane is consistent with prior IPCC practice.\974\ The use of this 
GWP for credit adjustments will not begin until 2021, when the Phase 2 
engine standards go into effect. The choice of this GWP value for 
future rules on this timescale does not prejudice the choice of other 
GWP values for use in regulations and other purposes in the near term.
---------------------------------------------------------------------------

    \974\ The corresponding N2O value from the AR5 report 
is 298, which is the same as the value used in Phase 1.
---------------------------------------------------------------------------

    To be consistent with other lifecycle analyses, the agencies are 
continuing to use AR4 value of 25 for the methane GWP in our lifecycle 
analyses. However, as discussed in Chapter 13.1 of the RIA, we have 
also conducted sensitivity analyses using methane GWP values ranging 
from 7.6 to 72.
(b) Appropriate Deterioration Factors for NG Tailpipe Emissions
    EPA requested comment on the current assigned deterioration factors 
for CO2, N2O, and CH4 based on diesel 
technology. We received one comment on this topic indicating the 
commenter knew of no data to support a deterioration analysis and that 
our approach for deterioration should remain as is. EPA has decided not 
to take action on this topic at this time and will continue the Phase 1 
approach.
(c) LNG Vehicle Boil-Off Warning System
    EPA requested comment on the feasibility and appropriateness of a 
regulatory requirement that LNG fueled vehicles include a warning 
system that would notify the driver of a pending boil-off event as one 
means reduce the frequency of such events and thus limit the release of 
methane. We received several comments expressing safety concern related 
to this approach. While such a system could be beneficial to the owner 
of a vehicle, EPA is not taking action at this time. We encourage 
innovation for safe technologies to evolve for warning of potential 
boil-off events which would also save the vehicle owner the cost of the 
fuel in the tank while protecting the atmosphere from large amounts of 
methane gas.
(d) Extending the 5-Day Hold Time for LNG Vehicles
    EPA proposed to require manufacturers to comply with the existing 
evaporative emission standards by showing compliance with a 5-day hold 
time. 80 FR 40510. We also solicited comment on the ability of emerging 
technologies to address an extension of 5-day requirement to a longer 
period of time such as 10 days. After considering the comments, EPA is 
not extending the hold time beyond 5 days in this rule.
    The specifications of the 5-Day Hold Time SAE J2343 safety related 
standard will only affect LNG vehicles starting in the year 2021 to 
help prevent boil-off events. After speaking to LNG truck manufacturers 
and LNG fuel providers, our understanding is that most LNG is dispensed 
at about 100 to 120 pounds per square inch gauge (psig), which 
corresponds to -200 degrees Fahrenheit) and at that temperature, new 
LNG trucks with new LNG storage tanks are achieving more than a 5-day 
hold time today. However, over time, the vacuum insulation of the LNG 
storage tank scan fail, resulting in degraded LNG hold-time as the 
truck ages. The requirement that the LNG truck must meet the 5-day 
hold-time over its entire useful life will likely improve the truck's 
hold time after the first several years in service. While LNG tank 
manufacturers are further developing their technologies for improvement 
of hold times and reducing boil-off from LNG storage tanks on trucks, 
the 5-day hold time requirement over the truck's useful life will 
ensure that they make the improvements to the period of the truck's 
life which is most at risk for boil-off events, which is when the truck 
is sold off into the secondary market and its use diminishes.
    EPA considered requiring new trucks to have the capability to use 
cold fuel. Most of the LNG trucks on the road at this time use the 
warmer fuel; therefore, most refueling stations are dispensing the 
warmer fuel only. A cold fuel requirement could force refueling 
stations to make a large potentially burdensome investment to provide 
the colder fuel in addition to the warmer fuel, because only a few cold 
fuel LNG trucks might be sold in that area. We would need to study the 
implications of this scenario further and gain a better understanding 
of the emissions from boil-off events before we would feel confident in 
how a cold LNG fuel requirement would affect the refueling industry and 
reduce methane emissions. A cold LNG fuel requirement would likely be 
more feasible for new fleets since they could design their truck fleet 
and their own fueling equipment from the ground up to use the cold LNG 
fuel.
    Another possible approach would be to increase the R- value of the 
tank to keep the warm fuel colder for longer. This likely would further 
reduce boil-off events, although, again, we are uncertain of the 
benefits versus the costs. We believe that ensuring that the 5-day hold 
time can be met over the truck's useful life is the best, lowest cost 
strategy to reduce the number of boil-off events.
(e) Capturing and/or Converting Methane Refueling or Boil-Off Emissions
    Although we are not requiring it, EPA is interested in watching the 
progression of innovative technologies that can capture methane 
emissions during a boil-off event to prevent large amounts of 
greenhouse gas emissions into the atmosphere. We encourage design and 
development of ideas such as a methane canister using adsorbents such 
as ANG \975\ (adsorbed natural gas) which could be added to capture the 
methane which otherwise will be released to the environment during a 
refueling or boil-off event. Once captured, steps could be taken to 
route the methane to the engine intake once the vehicle is operating 
again, or to take steps to converting the methane to less GHG-potent 
CO2.
---------------------------------------------------------------------------

    \975\ Menon, V.C., Komarneni, S. ``Porous Adsorbents from 
Vehicular natural Gas Storage: A Review,'' Journal of Porous 
Materials 5, 43-58 (1998).
---------------------------------------------------------------------------

    Instead of discharging methane to the environment, the methane 
potentially could be burned to CO2 using a burner. Another 
potential option would be to convert the methane capture in a canister 
to CO2 over a catalyst.
(f) Reducing Refueling Emissions
    When refueling a natural gas vehicle, some amount of methane is 
vented to the atmosphere. Requirements adopted as part of the Tier 3 
rules require use of the ANSI-NGV1-2006 standard practice to meet the 
evaporative emissions refueling requirement.\976\ Small emissions of up 
to 200 cc/hr (which equates to 72 grams of methane per hour) of leakage 
are allowed with these tests. Often there is a vent line which carries 
these emissions away from the nozzle interface for safety reasons, 
which emissions are then vented to the atmosphere. EPA requested 
comment on ways to eliminate or reduce these losses. There was a mixed 
response on whether methane gas can be captured during refueling using 
systems that route methane emissions back to the fuel storage tank, 
whether it is a CNG tank, a CNG pipeline or re-liquefying system for 
LNG. Some refueling stations are already doing this as common practice.
---------------------------------------------------------------------------

    \976\ Control of Air Pollution from Motor Vehicles Tier 3 Motor 
Vehicle Emission and Fuel Standards, Final Rule April 28, 2014, CFR 
86.1(c) (1).
---------------------------------------------------------------------------

    For LNG, in addition to the boil-off issue, there is the issue of 
the recurrence of manual venting at refueling by truck operators. Under 
high pressure

[[Page 73931]]

circumstances, such as when the vehicle has been sitting for some time 
period in warmer temperatures, it is necessary to decrease the pressure 
in the fuel tank before new fuel can enter the tank. The recommended 
practice is to transfer the extra vaporized fuel to the gas station or 
natural gas pipeline, but this can take extra time. In some areas it 
has turned into common practice to just vent to the atmosphere to keep 
the down time at the refueling station to a minimum. In other areas 
there is an incentive to reroute the gas into the station storage tank 
or natural gas pipeline with credit towards the fuel purchase. Since 
this is a stationary source issue, EPA is not taking action at this 
time on these issues in this engine/vehicle rulemaking. We also do not 
have enough information on the extent of emissions and rate of 
occurrence for this problem.
(g) On-Board Monitoring Requirements for Boil-Off Events and Venting at 
Refueling
    Onboard diagnostics for engines used in vehicle applications 
greater than 14,000 lbs GVWR are already required to detect and warn 
the operator when methane leaks occur due to wear of connections and 
components of the CNG or LNG fuel system (74 FR 8310, February 24, 
2009). We requested comments on requiring on-board monitoring to track 
boil-off events, as well as comment on whether the excess vapors were 
properly vented to the station storage tanks or NG pipeline or whether 
the gaseous methane emissions were vented to atmosphere during 
refueling events. 80 FR 40512. Each boil off event has the potential to 
release on the order of 5,300-15,800 grams of CH4 which 
translates to 132K-400K grams CO2 equivalent with a GWP of 
25 for 100 years (see RIA Chapter 13 for more information on LNG boil-
off emissions calculations). EPA is not able to take further action on 
OBD requirements at this time since we do not have enough information 
on the emissions from leaks and their rate of occurrence. Designing an 
OBD system is complicated and expensive if we are to expect any degree 
of accuracy for more than just very large leaks. In CNG there is an 
odorant and a truck operator could potentially detect a leak if it is 
large enough. Even if the leak could be detected from the odor, it 
would be difficult to know how much is actually being released if you 
can smell it. Different operators will have different degrees of 
sensitivity with their olfactory awareness. LNG does not have an 
odorant and could benefit from an OBD system even more. We do, 
therefore, encourage the development of systems for indicating these 
events to vehicle owners to both save on fuel and protect the 
environment.
(h) Separate Standards for Natural Gas Vehicles
    As described above, the climate impact of leaks and other methane 
emissions that occur upstream of the vehicle can potentially be large 
enough to more than offset the CO2 benefit of natural gas 
vehicles as measured at the vehicle tailpipe. As described earlier, EPA 
has taken some actions, and is considering further separate actions to 
control these upstream emissions. We also have some concern that the 
impact of upstream and downstream emissions for natural gas could be 
much higher than for gasoline or diesel fuel because of the high Global 
Warming Potential (GWP) for methane that makes even small leaks of 
natural gas a concern. In this way, natural gas is very different than 
other alternative fuels. While we are not adopting any provisions to 
address this here, we may consider adopting such provisions in a future 
rule. As discussed in Section XI.B, EPA is putting in place a series of 
regulations in the natural gas sector for upstream leaks. With the 
currently available data the uncertainties are very high in calculating 
upstream emissions for both natural gas and diesel vehicles. These 
uncertainties, the desirability of a unified national program for HD 
GHG and fuel consumption standards, combined with the low sales volumes 
projected for natural gas vehicles for the foreseeable future make it 
inadvisable for us to pursue more than a vehicle based standard at this 
time. See also Section I.F.(3) for additional discussion of why EPA is 
setting tailpipe standards in this rulemaking.

E. Dimethyl Ether

    Although NAS (2014) focused its recommendations on natural gas, it 
also discussed dimethyl ether (DME), which is a potential heavy-duty 
truck fuel sourced from natural gas. Dimethyl ether has a high cetane 
number (more than 55), although its energy density is about 60 percent 
of that of diesel fuel. Dimethyl ether is a volatile fuel, like 
liquefied petroleum gas that can be stored as a liquid at normal 
ambient temperatures under moderate pressure. Typical DME fuel tanks 
would be designed to prevent any significant evaporative emissions.
    A DME fueled truck is only modestly more expensive than a diesel 
fuel truck. The fuel tank is more expensive than a diesel fuel tank, 
but much less expensive than an LNG tank since it does not need to be 
heavily insulated. The engine modifications to enable using DME are 
also modest. Because DME does not have carbon-carbon bonds that form 
particulate matter particles during combustion, the particulate filter, 
which is standard equipment on new diesel trucks, can be eliminated. 
This offsets some of the engine and fuel tank costs.
    Although DME is sourced from cheap natural gas, the conversion of 
natural gas to DME and moving the fuel to retail outlets greatly 
increases the cost of the fuel. Based on the crude oil and natural gas 
prices in early 2014 (about $100 per barrel), DME is more expensive 
than LNG, but still lower in cost than diesel fuel (DME is estimated to 
cost $3.50/DGE, or $0.30 DGE less than diesel fuel.) After the decline 
in crude oil prices, DME is estimated to be priced higher than diesel 
fuel.
    Because there is very little DME use in the U.S. (there is only a 
very small fleet of trucks in California), we did not conduct a 
lifecycle assessment of DME, but note here a few aspects of a lifecycle 
analysis for DME. First, since DME is sourced from natural gas, the 
upstream methane emissions from the natural gas industry would still be 
allocated to DME. Second, there are no venting issues associated with 
DME as there are with LNG refueling or boil-off. Third, because DME has 
a lifetime of less than a week in the atmosphere, it has little direct 
climate impacts. Thus, it is likely that DME would have a lower GHG 
impact than LNG trucks, and perhaps lower than CNG trucks, although we 
would have to study DME use in trucks further to be more certain.

XII. Amendments to Phase 1 Standards

    The agencies are revising the regulatory text specifying test 
procedures and compliance provisions used for Phase 1. For the most 
part, these amendments apply exclusively to the Phase 2 rules. In a few 
limited instances, the agencies are adopting changes to the Phase 1 
program. These limited changes to the Phase 1 program are largely 
conforming amendments, and are described below, along with other minor 
changes to the Phase 1 compliance program. These changes generally 
continue to apply under the Phase 2 program.
    For the convenience of the reader, we are republishing 40 CFR parts 
1036 and 1037 in their entirety, including text that is not being 
amended. We are also republishing Phase 1 text in 40 CFR part 86. We 
note, however, that we have not reconsidered, rethought, or reopened 
the Phase 1 rules in a general sense. We have also not reconsidered, 
rethought, or reopened the stringency of the Phase 1 standards or other 
fundamental

[[Page 73932]]

aspects of the Phase 1 program that remain unchanged substantively.
    The agencies received very few comments of these changes. Daimler 
commented that the agencies should not make any changes to Phase 1 
because manufacturers have already developed systems to comply with the 
existing requirements. We do not necessarily agree that would be a 
sufficient reason to keep us from amending Phase 1 requirements through 
notice and comment rulemaking. Nevertheless, we note that we are not 
finalizing changes that would have any significant impact on the 
manufacturers' Phase 1 compliance structures.

A. EPA Amendments

(1) Pickups and Vans
    EPA is relocating the GHG standards and other regulatory provisions 
for chassis-certified HD pickups and vans in the Code of Federal 
Regulations from 40 CFR 1037.104 to 40 CFR 86.1819-14. Accordingly, 
NHTSA is modifying any of EPA's references in 49 CFR parts 523 and 535 
to accommodate the migration. EPA is making this change largely to 
address ambiguities regarding the application of additional provisions 
from 40 CFR part 86, subpart S, for these vehicles. The approach in 40 
CFR 1037.104 was to state that all of 40 CFR part 86, subpart S, 
applies except as specified in 40 CFR 1037.104; however, the recent 
standards adopted for light-duty vehicles and light-duty trucks 
included several changes to 40 CFR part 86, subpart S, that should not 
apply for chassis-certified HD pickups and vans. Based on our 
experience implementing the Phase 1 program, we believe it is 
appropriate to include the GHG standards for chassis-certified HD 
pickups and vans in the same part as light-duty vehicles (40 CFR part 
86, subpart S). All other certification requirements for these heavy-
duty vehicles--criteria exhaust standards, evaporative and refueling 
standards, provisions for onboard diagnostics, and the range of 
certification and compliance provisions--are in that subpart. We note 
that we have not experienced the same challenges for other heavy-duty 
vehicles, and are therefore not relocating the other provisions of 40 
CFR part 1037.
    This migration has highlighted a few areas where we need to clarify 
how the regulations apply for chassis-certified HD pickups and vans. In 
particular, EPA is adopting the following changes:
     Clarify that the GHG standards apply at high-altitude 
conditions.
     State that fleet-average calculation of carbon-related 
exhaust emissions (CREE) is not required for chassis-certified HD 
pickups and vans. Instead, heavy-duty vehicles are subject to 
CO2 standards.
     Clarify that requirements related to model types and 
production-weighted average calculation apply only for passenger 
automobiles and light trucks.
     State that the credit and debit provisions of 40 CFR 
86.1865-12(k)(5) do not apply for chassis-certified HD pickups and 
vans.
     Clarify that the Temporary Lead Time Allowance Alternative 
Standards in 40 CFR 86.1865-12(k)(7) do not apply for chassis-certified 
HD pickups and vans.
     State that the early credit provisions of 40 CFR 86.1866-
12, 86.1867-12, 86.1868-12, 86.1869-12, 86.1870-12, and 86.1871-12 do 
not apply for chassis-certified HD pickups and vans.
(2) Heavy-Duty Engines
    EPA is revising the approach to classifying gaseous-fuel engines 
with respect to both GHG and criteria emission standards. The general 
approach is to continue to divide these engines into spark-ignition and 
compression-ignition categories, but we will apply the compression-
ignition standards to all engines that qualify as heavy heavy-duty 
engines based on the primary intended service class.\977\ Previously, 
any gaseous-fuel engine derived from a gasoline engine was subject to 
the spark-ignition standards no matter the weight class of the vehicle. 
As described in Section II, EPA now believes this approach does not 
reflect the reality that engines used in Class 8 vehicles compete 
directly with diesel engines. We believe they should therefore be 
required to meet the same emission standards. Because all current 
gaseous-fuel engines for these large vehicles are already being 
certified to the compression-ignition engine standards, we can apply 
this approach to engines subject to the HD GHG Phase 1 standards 
without adverse impacts on any manufacturers. We proposed this same 
approach for medium heavy-duty engines, but have revised the rule in 
response to comments objecting to the change; the final rule instead 
applies standards to these engines as spark-ignition or compression-
ignition based only on each engine's characteristics. We believe this 
is appropriate because a substantial number of medium heavy-duty 
vehicles use gasoline-fueled engines, and gaseous-fueled engines used 
in these vehicles would therefore not always be competing directly with 
diesel-fueled engines as the main alternative.
---------------------------------------------------------------------------

    \977\ Engine classification is set forth in 40 CFR 1036.801. 
Spark-ignition means relating to a gasoline-fueled engine or any 
other type of engine with a spark plug (or other sparking device) 
and with operating characteristics similar to the Otto combustion 
cycle. Compression-ignition engines are reciprocating internal-
combustion engines that are not spark-ignition engines.
---------------------------------------------------------------------------

    EPA is also revising the regulation to spell out how to apply 
enforcement liability for a situation in which the engine manufacturer 
uses deficit credits for one or more model years. Simply put, any time 
an engine manufacturer is allowed to carry a deficit to the next year, 
all enforcement liability for the engines that generated the deficit 
are extended for another year. These provisions are the same as what we 
have already adopted for heavy-duty vehicles subject to GHG standards 
under 40 CFR part 1037.
(3) Evaporative Emission Testing for Natural Gas Vehicles
    Heavy-duty vehicles fueled by natural gas have for many years been 
subject to evaporative emission standards and test procedures. While 
fuel systems containing gasoline require extensive design features to 
handle vented fuel, fuel systems containing natural gas generally 
prevent evaporative losses by remaining sealed. In the case of 
compressed natural gas, there is a voluntary consensus standard, ANSI 
NGV1-2006, that is designed to ensure that there are no leaks or losses 
during a refueling event. Since compressed natural gas systems remain 
sealed indefinitely once the refueling event is complete, we understand 
that complying with the ANSI refueling standard is sufficient to 
demonstrate that the vehicle also complies with all applicable 
evaporative emission standards. The Light-Duty Tier 3 final rule 
included provisions to clarify that compressed natural gas systems 
meeting the applicable ANSI standard are deemed to comply with EPA's 
evaporative emission standards. In response to comments received on the 
proposed rule, we are adding a reference to a supplemental ANSI 
standard that similarly specifies system-integrity requirements for 
CNG-fueled heavy-duty vehicles that allow for substantially higher 
refueling rates; this supplemental standard will eventually be 
incorporated into ANSI NGV1.
    Systems using liquefied natural gas (LNG) behave similarly, except 
that the cryogenically stored fuel needs to be vented to prevent an 
over-pressure situation if the vehicle is not used for an extended 
time, as described in Section XI. Such vehicles are currently subject 
to evaporative emission standards and test procedures, though there are 
some

[[Page 73933]]

substantial questions about how one can best apply the procedures to 
these systems; not all of the instructions about preconditioning the 
vehicle are straightforward for cryogenic fuel systems with no 
evaporative canister. EPA is adopting an approach that is similar to 
what applies for compressed natural gas systems, which needs some 
additional attention to address boil-off emissions. SAE J2343 is a 
voluntary consensus standard that specifies a recommended practice to 
establish a minimum five-day hold time before boil-off starts to occur 
for LNG systems. EPA is adopting a requirement that manufacturers of 
LNG vehicles meet the SAE J2343 standard as a means of demonstrating 
compliance with evaporative and refueling emission standards.
    While the hold-time requirements of SAE J2343 are clear, there 
appears to be very little description of the procedure to determine how 
much time passes between a refueling event and initial venting. To 
ensure that all manufacturers are subject to the same set of 
requirements, we are adding a minimal set of specifications 
corresponding to the demonstration under SAE J2343. In particular, the 
regulation specifies that the tank must remain at rest throughout the 
measurement procedure, ambient temperatures must remain between 20 and 
30 [deg]C, and the hold-time period starts when the tank pressure 
reaches 690 kPa (100 psi) after a conventional refueling event. We are 
also adopting a simplified standard that translates the five-day hold 
time into a maximum allowable pressure build over a shorter time for 
parked vehicles. In particular, for vehicles parked for at least 12 
hours, tank pressure must not increase by more than an average of 9 kPa 
(1.3 psi) per hour. The pressure increase corresponding to the five-day 
hold-time standard is about 7.5 kPa per hour. The additional margin is 
intended to account for variability related to different ambient 
conditions, vehicle handling, nonlinear pressure increases, measurement 
instruments, and other factors. This is intended to give vehicle owners 
a more practical performance measure to evaluate whether tanks continue 
to meet the hold-time requirement.
    Manufacturers may rely on SAE J2343 to meet evaporative and 
refueling standards immediately with completion of the final rule; this 
demonstration becomes mandatory for vehicles produced on or after 
January 1, 2020.
    One commenter suggested that we add a reference to European test 
protocols for CNG heavy-duty vehicles to allow for a higher refueling 
flow rate than is allowed under the EPA regulations, which are based on 
hardware and procedures for light-duty vehicles (ANSI NGV1). We learned 
that the European protocol is based on systems up to 3000 psi and is 
therefore not valid for most heavy-duty CNG vehicles in the United 
States. Representatives of the natural gas industry responded to the 
comment suggesting the European protocol by recommending that we 
instead reference a recently published supplement to ANSI NGV1, which 
accommodates the higher flow rates corresponding to heavy-duty vehicles 
and current refueling technology. We are accordingly revising the 
regulation to reference this additional ANSI document, which is known 
as CSA IR-1-15, ``Compressed Natural Gas Vehicle (NGV) High Flow 
Fueling Connection Devices.''
(4) Compliance and Other General Provisions
    EPA is adopting the following changes that apply broadly for 
different types of vehicles or engines:
     Providing additional detail about manufacturers 
obligations with respect to delegated assembly. In response to 
comments, we have delayed the applicability of these provisions until 
January 1, 2018 to provide manufacturers with additional lead time. See 
40 CFR 1037.150(e) and 1037.621.
     Add a requirement for vehicle manufacturers that sell 
incomplete vehicles to secondary vehicle manufacturers to provide 
emission-related assembly instructions to ensure that the completed 
vehicle will be in a certified configuration.
     Specify parameters for determining a vehicle's curb 
weight, consistent with current practice for vehicles certified under 
40 CFR part 86, subpart S.
     Revise the recordkeeping requirement to specify a uniform 
eight-year retention period for all data supporting an application for 
certification. The provision allowing for one-year retention for 
``routine data'' is no longer necessary now that data collection is all 
recorded in electronic format. EPA is also clarifying that the eight-
year retention period is calculated relative to the latest associated 
application for certification, not from the date the data were 
generated.
     Change the rounding for analytically derived 
CO2 emission rates and target values from the nearest 0.1 g/
mile to the nearest 1 g/mile.
     Clarify how manufacturers may amend an application for 
certification after the end of the model year.
     Remove the general recordkeeping provisions from 40 CFR 
1037.735 that are already described in 40 CFR 1037.825.
     Clarify how EPA will conduct selective enforcement audits 
(SEAs) for engines (in 40 CFR 1036.301) and vehicles and components (in 
40 CFR 1037.301-1037.320) with respect to GHG emissions.
     Add provisions to provide a streamlined path for off-cycle 
credit for adding Phase 2 technologies to Phase 1 vehicles. See 40 CFR 
1037.150.
    EPA proposed a different equation with a ratio of 0.8330 in 40 CFR 
1037.525 for the case of full yaw sweep measurements to determine wind-
averaged drag correction as an amendment to the Phase 1 program. Some 
commenters argued that this change would impact stringency, but we 
disagree because manufacturers are already subject to EPA compliance 
using both methods (full yaw sweep and 6 degree 
measurements), and this Phase 1 flexibility was not used in setting the 
level of the Phase 1 standards. Nevertheless, we are adopting the final 
rule without this change to the Phase 1 standards. Other changes in the 
existing Phase 1 regulations for MY 2017 will serve to mitigate any 
impacts, and the agencies are no longer convinced the potential 
disruption to manufacturers' compliance plan is warranted.

B. Other Compliance Provisions for NHTSA

(1) Standards and Credit Alignment
    In Phase 1, the agencies intended GHG and fuel consumption 
standards for segments of the National Program to be in alignment so 
that manufacturers will not be required to build vehicles to meet in 
equivalent standards. Despite the intent, NHTSA and EPA have identified 
several scenarios where credits and compliance to both sets of 
standards are not aligned. This misalignment can have various impacts 
on compliance with the National Program.
    For example, a manufacturer of tractors could have two vehicle 
families that with same number of vehicles but with opposite and equal 
compliance margins with standards. In this scenario, the first family 
will over-comply with the GHG standard while the second family will 
under-comply with the GHG standard by the same amount of grams 
CO2/ton-mile. In calculating credits, the manufacturer will 
have a net of zero

[[Page 73934]]

GHG credits and exactly meet compliance; however, based on conversions 
and rounding of the standard and performance results that manufacturer 
could end up earning credits or having a credit deficit under NHTSA's 
fuel efficiency program.
    In order to correct this misalignment, NHTSA proposed to amend the 
existing fuel consumption standards and the method for calculating 
performance values for all compliance categories by increasing the 
significant digits in these conversion values. Increasing the 
significant digits in these values will result in more precise 
alignment between final compliance credit balances.
    NHTSA proposed that the increase resolution would apply 
retroactively starting for the model year 2013 standard. However, 
because the Phase 1 fuel consumption standards created a difference in 
compliance margins which could potentially have an adversely impact for 
certain manufacturers who have already developed engineering plans 
considering previous credit balance, NHTSA sought comments on whether 
optional to allow manufacturer to continue using the Phase 1 standards. 
No comments were received in response.
    NHTSA is finalizing its standards and performances for the Phase 1 
and 2 programs with increased significant digits as the only option for 
compliance. Retaining the previous accuracy does not maintain a single 
national program and aligning credit balances is more important because 
it ensures the same compliance outcome. Manufacturers who may have 
planned their compliance strategies using the previous approach would 
not be able to take advantage of any relaxations in in the NHTSA 
program because the national program requires one single compliance 
fleet and manufacturers would still need to comply with the more 
stringent EPA standards.
(2) Off-Road Exemption Petition Process for Tractors and Vocational 
Vehicles
    In the Phase 1 final rule, the agencies added provisions for 
certain types of vocational tractors and vocational vehicles that 
operate off-road to be exempt from standards, although standards will 
still apply to the engines installed in these vehicles. An exemption 
was warranted because these vehicles operate in a manner essentially 
making them incompatible with fuel saving and emission reduction 
technologies, such as performing work in an off-road environment, being 
speed restricted, or having off-road components or other features 
making them incompatible for roadways. For the Phase 1 program, off-
road vehicle manufacturers meeting the exemption provisions are 
required to provide EPA and NHTSA, through the EPA database, a report 
within 90 days after the end of each model year identifying its off-
road vehicles. The report must provide a description of each excluded 
vehicle configuration, including an explanation of why it qualifies for 
the exclusion and the production volume. A manufacturer having an off-
road vehicle that does not meet the criteria under the agencies' off-
road exemptions in 40 CFR 1037.631 and 49 CFR 535.5 is allowed to 
submit a petition under 40 CFR 1037.150(h) and 49 CFR 535.8 describing 
how and why its vehicles should qualify for exclusion based on criteria 
that are equivalent to those specified in 40 CFR 1037.631.
    Under Phase 1 compliance processes, manufacturers have not been 
using the petitioning process to get approval of an exemption for off-
road vehicles that do not meet the specified criteria to qualify for an 
exemption. Instead, manufacturers have been submitting information to 
EPA during production for a given model year to determine whether or 
not these vehicles qualify for an exemption, or if they need to get 
certificates of conformity for the vehicles they already produced. EPA 
and NHTSA collaboratively determine whether manufacturers should 
qualify for an exemption under 40 CFR 1037.150(h) and 49 CFR 535.8, and 
EPA shares the decision with the manufacturer.
    For the Phase 1 and 2 standards, the agencies are revising the 
regulations to clarify the process for vehicle manufacturers to get 
approval for an exemption in unusual circumstances in which the vehicle 
should be exempt even though it does not automatically qualify for an 
exemption under the criteria specified in 40 CFR 1037.631 and 49 CFR 
535.5. Most importantly, we now specify at 40 CFR 1037.150(h) and 49 
CFR 535.8 that manufacturers must get approval for the exemption before 
producing the subject vehicles to avoid violating statutory 
prohibitions. EPA and NHTSA will continue to collaborate in making any 
final decisions on exemptions.
    Note that vehicles meeting the qualifying criteria under 40 CFR 
1037.631 and 49 CFR 535.5 are exempt without request; however, if 
manufacturers want to address any uncertainty by getting EPA and NHTSA 
to affirm that their vehicles do in fact meet the specified criteria, 
they may ask for preliminary approval under 40 CFR 1037.210.
(3) Innovative Technology Request Documentation Specifications
    For vehicle and engine technologies that can reduce GHG and fuel 
consumption, but for which there is not yet an established method for 
quantifying reductions, the agencies encourage the development of such 
technologies through providing ``innovative technology'' credits. 
Manufacturers seeking innovative technology credits must quantify the 
reductions in fuel consumption and GHG emissions that the technology is 
expected to achieve, above and beyond those achieved on the existing 
test procedures.
    Manufacturers submitting innovative technology requests must send a 
detailed description of the technology and a recommended test plan to 
EPA as detailed in 40 CFR 1036.610 and 1037.610. The test plan must 
include whether the manufacturer is applying for credits using the 
improvement factor method or the separate-credit method. It is 
recommended that manufacturers not conduct testing until the agencies 
can collaboratively approve the test plan in which a determination is 
made on the qualification of the technology as innovative. EPA in 
consultation with NHTSA also makes the decision at that time whether to 
seek public comments on the test plan if there are unknown factors in 
the test methodology.
    The agencies have received feedback from manufacturers that the 
final approval process is not clearly defined, which has caused a 
substantial time commitment from manufacturers. To address this 
feedback, for the final rule, the agencies are adopting further 
clarification in 40 CFR 1036.610 and 1037.610 defining the steps 
manufacturers must follow after an approval is granted for a test plan. 
This includes specifications for submitting the final documentation to 
the agencies for final approval and for determining credit amounts. The 
agencies are adding the same level of detail as required for the final 
documentation required in EPA's light duty off-cycle program in 40 CFR 
86.1869-12(e)(2). These specifications should provide manufacturers 
with a clear understanding of the required documentation and approval 
process to reduce the time burden placed on manufacturers.
    NHTSA is also adding similar provisions from its light duty CAFE 
program specified in 49 CFR 531.6(b)(2) and 533.6(c)(2) for limiting 
the approval of innovative technologies under its program for those 
technologies related to crash-avoidance technologies, safety

[[Page 73935]]

critical systems or systems affecting safety-critical functions, or 
technologies designed for the purpose of reducing the frequency of 
vehicle crashes. NHTSA prohibited credits for these technologies under 
any circumstances in its CAFE program (see 77 FR 62730). NHTSA believes 
a similar strategy is warranted for heavy-duty vehicle as well.
(4) Credit Acquisition Plan Requirements
    The National Program was designed to provide manufacturers with 
averaging, banking and trading (ABT) flexibilities for meeting the GHG 
and fuel efficiency standards to optimize the effectiveness of the 
program. As a part of these flexibilities, manufacturers generating a 
shortfall in fuel consumption credits for a given model year must 
submit a credit plan to NHTSA describing how it plans to resolve its 
deficits within 3 models year. To assist manufacturers, NHTSA is modify 
49 CFR 535.9(a)(6) of its regulation to clarify and provide guidance to 
manufacturers on the requirements for a credit allocation plan which 
contains provisions to acquire credits from another manufacturer which 
will be earned in future model years.
    The current regulations do not specify if future credit acquisition 
is permitted or not and the revision is intended to clarity that it is, 
with respect to the limitation a credit shortfall can only be carried 
forward three years. Providing this clarification is intended to 
increase transparency within the program and ensure all manufacturers 
are aware of its available flexibilities. NHTSA is adopting the 
requirement that in order for a credit allocation plan to be approved, 
NHTSA will require an agreement signed by both manufacturers. This 
requirement will assist NHTSA with its determination that the credits 
will become available to the acquiring manufacturer when they are 
earned.
(5) New Vehicle Field Inspections and Recordkeeping Requirements
    Previously, NHTSA decided not to include recordkeeping provisions 
in its regulations for the Phase 1 program. EPA regulations include 
recordkeeping requirements in 40 CFR 1036.250, 1036.735, 1036.825, 
1037.250, 1037.735, and 1037.825. For the Phase 2 program, NHTSA is 
adding recordkeeping provisions to facilitate its compliance validation 
program for the final rule. For the Phase 1 and 2 programs, 
manufacturers test and conduct modeling to determine GHG emissions and 
fuel consumption performance, and EPA and NHTSA perform validation 
testing. EPA uses the results of the validation tests to create a 
finalized report that confirms the manufacturer's final model year GHG 
emissions and fuel consumption results. Each agency will use this 
report to enforce compliance with its standards.
    NHTSA assesses compliance with fuel consumption standards each 
year, based upon EPA final verified data submitted to NHTSA for its 
heavy-duty vehicle fuel efficiency program established pursuant to 49 
U.S.C. 32902(k). NHTSA may conduct verification testing throughout a 
given model year in order to validate data received from manufacturers 
and will discuss any potential issues with EPA and the manufacturer. 
See 49 CFR 535.9. After the end of the model year, NHTSA may also 
decide to conduct field inspections in order to confirm whether or not 
a new vehicle was manufactured as originally certified. NHTSA may 
conduct field inspections separately or in coordination with EPA. To 
facilitate inspections, the agencies will add additional provisions to 
the EPA recordkeeping provisions to require manufacturers to keep build 
documents for each manufactured tractor or vocational vehicle. Each 
build document will be required to contain specific information on the 
design, manufacturing, equipment and certified components for a 
vehicle. NHTSA will request build documents through EPA and the 
agencies will collaborate on the finding of all field inspections. 
Manufacturers will be required to keep records of build documents for a 
period of 8 calendar years.

XIII. Other Regulatory Provisions

    In addition to the new GHG standards in these rules, EPA and NHTSA 
are amending various aspects of the regulations as part of the HD GHG 
Phase 1 standards for heavy-duty highway engines and vehicles, as 
described in Section XII. EPA is also taking the opportunity to amend 
regulatory provisions for other requirements that apply for heavy-duty 
highway engines, and for certain types of nonroad engines and 
equipment.
    Most of the amendments described in this section represent minor 
technical issues and, as such, were not the subject of extensive 
comment. Two exceptions are the issues related to glider kits and to 
competition vehicles, as noted below. The rest of this section, for 
which we received fewer comments, generally includes only references to 
the more significant comments, such as comments that impacted our 
conclusions for the provisions adopted in the final rule. See the RTC 
for a more complete discussion of the comments.
    For the convenience of the reader, we are republishing some related 
text that is not being amended. We note, however, that we have not 
reopened the standards or other fundamental aspects of these programs 
that remain unchanged substantively.

A. Amendments Related to Heavy-Duty Highway Engines and Vehicles

    This section describes a range of regulatory amendments for heavy-
duty highway engines and vehicles that are not directly related to GHG 
emission standards. Note that Section XIII. B. describes new 
requirements for glider kits and Section XIII. F. describes additional 
changes related to test procedures that affect heavy-duty highway 
engines.
(1) Alternate Emission Standards for Specialty Heavy-Duty Vehicles
    Motor vehicles conventionally comprise a familiar set of vehicles 
within a relatively narrow set of parameters--motorcycles, cars, light 
trucks, heavy trucks, buses, etc. The definition of ``motor vehicle;'' 
however, is written broadly to include a very wide range of vehicles. 
Almost any vehicle that can be safely operated on streets and highways 
is considered a motor vehicle under 40 CFR 85.1703. Development of 
EPA's emission control programs is generally focused on a consideration 
of the technology, characteristics, and operating parameters of 
conventional vehicles, and typically includes efforts to address 
concerns for special cases. For example, the driving schedule for 
light-duty vehicles includes a variation for vehicles that are not 
capable of reaching the maximum speeds specified in the Federal Test 
Procedure.
    Industry innovation in some cases leads to some configurations that 
make it particularly challenging to meet regulatory requirements. We 
are aware that plug-in hybrid-electric heavy-duty vehicles are an 
example of this. An engine for such a vehicle is expected to have a 
much lower power rating and duty cycle of engine speeds and loads than 
a conventional heavy-duty engine. The costs of regulatory compliance 
and the mismatch to the specified duty cycle can make it cost-
prohibitive for engine manufacturers to certify such an engine under 
the heavy-duty highway engine program.
    To address concerns about certifying atypical engines to highway 
heavy-duty standards for use in hybrid vehicles, we are therefore 
adopting a provision allowing manufacturers of heavy-duty

[[Page 73936]]

highway vehicles the option to install limited numbers of engines 
certified to alternate standards. Qualifying engines would be 
considered motor vehicle engines, but they may be certified to 
standards that are based on standards adopted for comparable nonroad 
engines. EPA's nonroad emission standards have reached a point that 
involves near parity with the level of emission control represented by 
the emission standards for heavy-duty highway engines. EPA developed 
these provisions especially for vehicles with hybrid powertrains; 
however, the same principles apply for three other unusual vehicles 
types: amphibious vehicles, vehicles with maximum speed at or below 45 
miles per hour, and as described below, certain all-terrain vehicles. 
We are therefore applying the same provisions to these additional 
vehicles.
    California ARB suggested that we limit relief to hybrid vehicles 
that have a series configuration, or to hybrid vehicles that have a 
minimum all-electric range. We chose not to adopt these limitations 
because these features are not fundamental to what we believe is the 
basis for accommodating special vehicle designs. For example, if a 
vehicle needs a 20-kW gasoline engine to recharge batteries used for 
propulsion, and provides a small amount of power directly to the 
wheels, we believe this should not be disqualified from using the 
specialty-vehicle provisions because there is no expectation that 20 kW 
engines will be certified to the conventional highway heavy-duty engine 
standards anytime in the foreseeable future.
    We proposed to offer this flexibility for hybrids, amphibious 
vehicles, and low-speed vehicles. We also received comment advocating 
that certain qualifying all-terrain vehicles are in a similar situation 
since they have unique engine-performance requirements that prevent 
them from finding compliant highway engines; we have modified the rule 
to also apply the specialty vehicle provisions to these all-terrain 
vehicles. The regulations will limit this allowance to vehicles that 
have portal axles, which are specialized axles that increase ground 
clearance. Cost and/or performance limits for such axles preclude their 
use for vehicles intended for use primarily on highways. Thus, we 
believe vehicles with such axles are designed primarily for off-road 
operation, while retaining the ability to occasionally operate on 
highways.
    Under approach being adopted for these various vehicles, 
compression-ignition engines could be certified to alternate standards 
that are equivalent to the emission standards under 40 CFR part 1039, 
and spark-ignition engines could be certified to alternate standards 
that are equivalent to the Blue Sky emission standards under 40 CFR 
part 1048.\978\ In response to a comment from California ARB, we are 
adopting a requirement that compression-ignition engines also meet a PM 
standard (Family Emission Limit) of 0.020 g/kW-hr corresponding to the 
PM standard that applies for heavy-duty highway engines. Similarly, we 
are adopting an N2O standard of 0.1 g/kW-hr for SCR-equipped 
diesel-fueled engines that corresponds to the N2O standard 
that applies for heavy-duty highway engines. This collection of 
standards aligns with our expectation that such engines would generally 
be expected to use the same technologies to control emissions as 
engines certified to the applicable emission standards for heavy-duty 
highway engines. (The regulation being finalized disallows this 
approach for compression-ignition engines below 56 kW since the nonroad 
standards for those engines are substantially less stringent than the 
standards that apply for heavy-duty highway engines). Also, since the 
nonroad duty cycles generally better represent the in-use operating 
characteristics of engines in these specialty vehicles, we expect the 
nonroad test procedures to be at least as effective in achieving 
effective in-use emission control. The regulations at 40 CFR part 1048 
include a simplified form of diagnostic controls, and we are adopting 
in these rules a simplified diagnostic control requirement for 40 CFR 
part 1039. These engine-based diagnostic controls substitute for the 
diagnostic requirements specified in 40 CFR 86.010-18. Note that the 
diagnostic requirements apply for engine systems or components; as 
such, we generally apply those diagnostic requirements to hybrid 
powertrain systems and components only if the engine manufacturer 
includes those features or parameters as part of the certified 
configuration for their engines. We may revisit issues related to 
diagnostic requirements for hybrid systems in a future rulemaking.
---------------------------------------------------------------------------

    \978\ Blue Sky standards are voluntary low-emission standards 
under 40 CFR part 1048.
---------------------------------------------------------------------------

    These alternate standards relate primarily to the engine 
certification-based emission standards and certification requirements. 
All vehicle-based requirements for evaporative emissions continue to 
apply as specified in the regulation. In addition, hybrid vehicles 
would still be subject to all the standards and requirements that apply 
to heavy-duty vehicles under 40 CFR part 1037. For example, 
manufacturers would need to perform powertrain testing and run GEM to 
determine the applicable g/ton-mile emission rate for hybrid vehicles. 
However, the agencies are not requiring vehicle certification for the 
three other types of specialty vehicles. Low-speed vehicles are already 
excluded from the vehicle requirements under Phase 1, while the 
amphibious and all-terrain vehicles would present significant 
challenges to the vehicle simulations.
    This allowance is intended to lower the barrier to introducing 
innovative technology for motor vehicles. It is not intended to provide 
a full alternative compliance path to avoid certifying to the emission 
standards and control requirements for highway engines and vehicles. To 
accomplish this, EPA will allow a manufacturer to produce no more than 
1,000 hybrid vehicles in a single model year under this program, and no 
more than 200 amphibious vehicles, all-terrain vehicles, or speed-
limited vehicles. In the case of hybrid vehicles, we are also acting on 
California ARB's request that we adopt a sunset provision for hybrid 
vehicles; accordingly, the simplified certification applies only 
through model year 2027. In the meantime we will monitor implementation 
of the program and consider whether there is any long-term need for 
these or other streamlined certification provisions for hybrid 
vehicles.
    As described in the proposed rule, California ARB is in the process 
of developing similar provisions for a reduced compliance burden for 
qualifying highway vehicles toward the goal of incentivizing vehicles 
with hybrid powertrains and low-NOX engines. The incentives 
generally consist of allowing specific OBD variances or deficiencies 
(for low-NOX engines) or broadly waiving OBD requirements 
(for hybrid vehicles). To the extent that California ARB certifies 
vehicles based on approving OBD deficiencies, we would apply a similar 
discretion for 49-state certification of the same engine model to allow 
for nationwide sale of those products. If California ARB approves 
certification of hybrid systems in which the highway OBD requirements 
are mostly or entirely waived, we would expect to apply the provisions 
described in this section to allow vehicle manufacturers to produce up 
to 1000 such vehicles in a given year.
(2) Chassis Certification of Class 4 Heavy-Duty Vehicles
    In the HD Phase 1 rule, the agencies included a provision allowing 
manufacturers to certify Class 4 and

[[Page 73937]]

larger heavy-duty vehicles to the chassis-based emission standards in 
40 CFR part 86, subpart S. This applied for greenhouse gas emission 
standards, but not criteria emission standards. EPA revisited this 
issue in the recent Tier 3 final rule, where we revised the regulation 
to allow this same flexibility relative to exhaust emission standards 
for criteria pollutants. However, this change to the regulation 
conflicted with our response to a comment in that rulemaking that EPA 
should not change the certification arrangement for criteria 
pollutants.
    EPA requested comment on how best to address this issue in a way 
that resolves the various and competing concerns. Commenters argued for 
and against allowing certification of the heavier vehicles to chassis-
based emission standards. In the final rule, we are adopting a limited 
allowance to certify vehicles above 14,000 pounds GVWR using chassis-
based certification procedures of 40 CFR part 86, subpart S. In 
particular, manufacturers may rely on chassis-based certification for 
heavier vehicles only if there is a family with vehicles at or below 
14,000 pounds GVWR that can properly accommodate the bigger vehicles as 
part of the same family. As part of this arrangement, chassis-certified 
vehicles above 14,000 pounds GVWR may not rely on a work factor that is 
greater than the largest work factor that applies for vehicles at or 
below 14,000 pounds GVWR from the same family.
(3) Nonconformance Penalties (NCPs)
    The Clean Air Act requires that heavy-duty standards for criteria 
pollutants such as NOX reflect the greatest degree of 
emission reduction achievable through the application of technology 
that EPA determines will be available. Such ``technology-forcing'' 
standards create the risk that one or more manufacturers may lag behind 
in the development of their technology to meet the standard and, thus, 
be forced out of the marketplace. Recognizing this risk, Congress 
enacted CAA section 206(g) (42 U.S.C. 7525(g)), which requires EPA to 
establish ``nonconformance penalties'' to protect these technological 
laggards by allowing them to pay a penalty for engines that temporarily 
are unable to meet the applicable emission standard, while removing any 
competitive advantage those technological laggards may have.
    On September 5, 2012, EPA adopted final NCPs for heavy heavy-duty 
diesel engines, which were available to manufacturers of heavy-duty 
diesel engines unable to meet the current oxides of nitrogen 
(NOX) emission standard. On December 11, 2013, the U.S. 
Court of Appeals for the District of Columbia Circuit issued an opinion 
vacating that Final Rule. It issued its mandate for this decision on 
April 16, 2014, ending the availability of the NCPs for the current 
NOX standard, as well as vacating certain amendments to the 
NCP regulations, due to concerns about inadequate notice. In 
particular, the amendments revised the text explaining how EPA 
determines when NCPs should be made available. In the NPRM for this 
rulemaking, EPA proposed to remove the vacated regulatory text 
specifying penalties, and re-proposed most of the other vacated 
amendments. Having now provided this additional notice and a full 
opportunity for comment, we believe that it is appropriate to finalize 
the proposed changes. EPA is also adopting the proposed new 40 CFR 
86.1103-2016 to replace the existing 40 CFR 86.1103-87.
(a) Vacated Penalties
    In EPA's regulations, NCP penalties are calculated from inputs 
specific to the standards for which NCPs are available. The input 
values are specified in 40 CFR 86.1105-87. EPA is removing paragraph 
(j) of this section which specifies the vacated inputs for the 2010 
NOX emission standard. Since all manufacturers are currently 
complying with these standards, and the court vacated the text in 
question, it no longer has any purpose.
(b) Re-Proposed Text
    The 2012 rule made amendments to four different sections in 40 CFR 
part 86. The amendments to 40 CFR 86.1104-91 and 86.1113-87 were 
supported during the rulemaking and were not questioned in the Court's 
decision. Nevertheless, these revisions were vacated along with the 
rest of the rule. In the NPRM, EPA re-proposed these changes, even 
though we had already provided full notice and opportunity for public 
comment for these changes. Since we are adopting text that is already 
in the CFR, the final rule consists of leaving these sections of the 
regulations unchanged.
(i) Upper Limits
    The changes to 40 CFR 86.1104-91 affect the upper limit. The upper 
limit (UL) is the emission level established by regulation above which 
NCPs are not available. A heavy duty engine cannot use NCPs to be 
certified for a level above the upper limit. CAA section 206(g)(2) 
refers to the upper limit as a percentage above the emission standard, 
set by regulation, that corresponds to an emission level EPA determines 
to be ``practicable.'' The upper limit is an important aspect of the 
NCP regulations not only because it establishes an emission level above 
which no engine may be certified using NCPs, but it is also a critical 
component of the cost analysis used to develop the penalty rates. The 
regulations specify that the relevant costs for determining the COC50 
and the COC90 factors are the difference between an engine at the upper 
limit and one that meets the applicable standards (see 40 CFR 86.1113-
87).
    The regulatory approach adopted under the prior NCP rules set the 
upper limit at the prior emission standard when a prior emission 
standard exists and is then changed to become more stringent. EPA 
concluded that this upper limit should be reasonably achievable by all 
manufacturers with engines or vehicles in the relevant class. It should 
be within reach of all manufacturers of HD engines or HD vehicles that 
are currently allowed so that they can continue to sell their engines 
and vehicles while finishing their development of fully complying 
engines. A manufacturer of a previously certified engine or vehicle 
should not be forced to immediately remove a HD engine or vehicle from 
the market when an emission standard becomes more stringent. The prior 
emission standard generally meets these goals because manufactures have 
already certified their vehicles to that standard.
    One of EPA's changes to the regulations in 40 CFR 86.1104-91 
clarifies that EPA may set the upper limit at a level below the 
previous standard if we determine that the lower level is achievable by 
all engines or vehicles in the relevant subclass. This was the case for 
the vacated NCP rule. Another change allows us to set the upper limit 
at a level above the previous standard in unusual circumstances, such 
as where a new standard for a different pollutant, or other 
requirement, effectively increases the stringency of the standard for 
which NCPs would apply. This occurred for heavy heavy-duty engines with 
the 2004 standards.
(ii) Payment of Penalties
    The changes to 40 CFR 86.1113-87 correct EPA organizational units 
and mail codes to which manufacturers must send information. The 
previous information is no longer valid.
(c) Criteria for the Availability of NCPs
    Since the promulgation of the first NCP rule in 1985, subsequent 
NCP rules generally have been described as continuing ``phases'' of the 
initial NCP

[[Page 73938]]

rule. The first NCP rule (Phase 1), sometimes referred to as the 
``generic'' NCP rule, established three basic criteria for determining 
the eligibility of emission standards for nonconformance penalties in 
any given model year (50 FR 35374, August 30, 1985). (For regulatory 
language, see 40 CFR 86.1103-87). The first criterion is that the 
emission standard in question must become more difficult to meet. This 
can occur in two ways, either by the emission standard itself becoming 
more stringent, or due to its interaction with another emission 
standard that has become more stringent. Second, substantial work must 
be required in order to meet the emission standard. EPA considers 
``substantial work'' to mean the application of technology not 
previously used in that vehicle or engine class/subclass, or a 
significant modification of existing technology, in order to bring that 
vehicle/engine into compliance. EPA does not consider minor 
modifications or calibration changes to be classified as substantial 
work. Third, EPA must find that a manufacturer is likely to be 
noncomplying for technological reasons (referred to in earlier rules as 
a ``technological laggard''). Prior NCP rules have considered such a 
technological laggard to be a manufacturer who cannot meet a particular 
emission standard due to technological (not economic) difficulties and 
who, in the absence of NCPs, might be forced from the marketplace. 
During the 2012 rulemaking, some commenters raised issues relating to 
EPA's interpretation of these criteria:
     The extent to which the criteria are intended to constrain 
EPA's ability to set NCPs
     The timing for evaluating the criteria
     The meaning of technological laggard
    As its primary finding in the 2013 decision, the Court stated that 
EPA had not provided sufficient notice or opportunity for comment 
regarding its interpretation of these criteria. To address the Court's 
notice and comment concern, EPA solicited comments in the Phase 2 NPRM 
on our proposed revisions to these criteria. Note that we proposed 
changes that are different from those at issue during the court case.
(i) Constraints on EPA
    Several commenters on the 2012 rule argued (implicitly or 
explicitly) that EPA cannot establish NCPs unless all of the regulatory 
criteria for NCPs (in 40 CFR 86.1103-87) are met. Some went further to 
argue that EPA must demonstrate that the criteria are met. However, the 
actual regulatory text has never stated that EPA may establish NCPs 
only if all criteria are met, but rather that EPA shall establish NCPs 
``provided that EPA finds'' the criteria are met. These criteria were 
included in the regulations to clarify that manufacturers should not 
expect EPA to initiate a rulemaking to establish NCPs where these 
criteria were not met. Moreover, the regulations clearly defer to EPA's 
judgment for finding that the criteria are met. While EPA must explain 
the basis of our finding, the regulatory language does not require us 
to prove or demonstrate that the criteria are met.
    This interpretation is consistent with the text of the Clean Air 
Act, which places no explicit restrictions on when EPA can set NCPs. In 
fact, it seems to create a presumption that NCPs will be available. The 
Act actually requires EPA to allow certification of engines that do not 
meet the standard unless EPA determines the practicable upper limit to 
be equal to the new emission standard.
    To address this confusion, the revised regulatory text explicitly 
states that where EPA cannot determine if all of the criteria have been 
met, we may presume that they have. In other words, EPA does not have 
the burden to prove they have been met. This policy was opposed by 
Volvo in its comments to this current rulemaking. It stated that EPA 
findings ``must be subject to public review and scrutiny'' to 
``adequately protect complying manufacturers' competitive interests.'' 
However, EPA sees no basis in the Act to believe that Congress intended 
EPA to protect complying manufacturers by denying a request for NCPs. 
Rather, Congress directed EPA to set the penalty at a level that would 
``remove any competitive disadvantage to manufacturers whose engines or 
vehicles achieve the required degree of emission reduction.'' \979\ 
Under the changes being adopted here, compliant manufacturers would 
retain the ability to challenge whether or not EPA had set penalties at 
a level that protects them.
---------------------------------------------------------------------------

    \979\ 42 U.S.C. 7525(g)(3)(E).
---------------------------------------------------------------------------

(ii) Timing for Evaluating Criteria
    In order to properly understand the appropriate timing for 
evaluating each of the NCP criteria, it is necessary to understand the 
purpose of each. When considered together, these criteria evaluate the 
likelihood that a manufacturer will be technologically unable to meet a 
standard on time. However, when EPA initially proposed the NCP 
criteria, we noted that the first two criteria addressed whether there 
was a possibility for a technological laggard to develop. When the 
first criterion (that there be a new standard) is met, it creates the 
possibility for a technological laggard to exist. When manufacturers 
must perform substantial work (as required for the second criterion), 
it is possible that at least one will be unsuccessful and will become a 
laggard. Thus, when evaluating these first two criteria, the purpose is 
to determine whether the standard created the possibility for a laggard 
to exist. The third criterion is different because it asks whether that 
possibility has turned into a likelihood that a technological laggard 
has developed. For example, a standard may become significantly more 
stringent and substantial effort might be required for compliance, but 
all manufacturers may be meeting the applicable standard. In that 
situation, a technological laggard is not likely and penalties would be 
unnecessary.
    In this context, it becomes clear that since the first two of these 
criteria are intended to address the question of whether a given 
standard creates the possibility for this to occur, they are evaluated 
before the third criterion that addresses the likelihood that the 
possibility will actually happen. In most cases, it is possible to 
evaluate these criteria at the point a new standard is adopted. This is 
the value of these criteria, that they can usually be evaluated long 
before there is enough information to know whether a technological 
laggard is actually likely. For example, where EPA adopts a new 
standard that is not technology-forcing, but rather merely an anti-
backsliding standard, EPA could determine at the time it is adopted 
that the second criterion is not met so that manufacturers would know 
in advance that no NCPs will be made available for that standard.
    One question that arose in the 2012 rule involved how to evaluate 
the second criterion if significant time has passed and some work 
toward meeting the standard has already been completed. To address this 
question, the revised text clarifies that this criterion is to be 
evaluated based on actual work needed to go from meeting the previous 
standard to meeting the current standard, regardless of the timing of 
such changes. EPA looks at whether ``substantial work'' is or was 
required to meet the revised standard at any time after the standard 
was issued--the important question is whether manufacturers who were 
using technology that met the previous standard would need to build 
upon that technology to meet the revised standard.

[[Page 73939]]

Other interpretations would seem to be directly contrary to the purpose 
of the statute, which is designed to allow technological laggards to be 
able to certify engines even if other manufacturers have met the 
standard.
(iii) Technological Laggards
    Questions also arose in 2012 about the meaning of the term 
``technological laggard.'' While the regulations do not define 
``technological laggard,'' EPA has previously interpreted this as 
meaning a manufacturer who cannot meet the emission standard due to 
technological difficulties, not merely economic difficulties (67 FR 
51464-51465, August 8, 2002). Some have interpreted this to mean that 
NCPs cannot be made available where a manufacturer tries and fails to 
meet a standard with one technology but knew that another technology 
would have allowed them to meet the standard. In other words, that it 
made a bad business decision. However, EPA's reference to ``economic 
difficulties'' applies where a technological path exists--at the time 
EPA is evaluating the third criterion--that would allow the 
manufacturer to meet the standard on time, but the manufacturer chooses 
not to use it for economic reasons. The key question is whether or not 
the technological path exists at the time of the evaluation. To address 
this confusion, the revised text clarifies that where there is 
uncertainty about whether a failure to meet the standards is a 
technological failure, EPA may presume that it was. Note that this does 
not mean that EPA might declare any failure to meet standards as a 
technological failure. The change would only apply where it is not 
clear.
(4) In-Use Testing
    EPA and manufacturers have gained substantial experience with in-
use testing over the last four or five years. This has led to important 
insights in ways that the test protocol can be adjusted to be more 
effective. EPA is accordingly making the following changes to the 
regulations in 40 CFR part 86, subparts N and T:
     Revise the NTE exclusion based on aftertreatment 
temperature to associate the exclusion with the specific aftertreatment 
device that does not meet the temperature criterion. For example, there 
should be no NOX exclusion if a diesel oxidation catalyst is 
below the temperature threshold. EPA is also revising the exclusion to 
consider accommodation of CO emissions when there is a problem with low 
temperatures in the exhaust.
     Clarify that exhaust temperatures should be measured 
continuously to evaluate whether those temperatures stay above the 250 
[deg]C threshold.
     Add specifications to describe where to measure 
temperatures for exhaust systems with multiple aftertreatment devices.
     Include a provision to add 0.00042 g/hp-hr to the PM 
measurement to account for PM emissions vented to the atmosphere 
through the crankcase vent.
     Increase the time allowed for submitting quarterly reports 
from 30 to 45 days after the end of the quarter.
(5) Miscellaneous Amendments to 40 CFR Part 86
    As described elsewhere, EPA is making several changes to 40 CFR 
part 86. This includes primarily the GHG standards for Class 2b and 3 
heavy-duty vehicles in subpart S. EPA is also making regulatory changes 
related to hearing procedures, adjustment factors for infrequent 
regeneration of aftertreatment devices, and the testing program for 
heavy-duty in-use vehicles.
    EPA is making several minor amendments to 40 CFR part 86, including 
the following:
     Revise 40 CFR 86.1811-17 to clarify that the Tier 2 SFTP 
for 4,000 mile testing applies to MDPVs, alternative fueled vehicles, 
and flexible fueled vehicles when operated on a fuel other than 
gasoline or diesel fuel, even though these vehicles were not subject to 
SFTP standards under the Tier 2 program. We described this in the 
Preamble to the Tier 3 final rule, and we are now making this explicit 
in the regulations.
     Revise 40 CFR 86.1813-17 to clarify that gaseous-fueled 
vehicles are not subject to the bleed emission test or standard.
     Revise 40 CFR 86.1823 to extend the default catalyst 
thermal reactivity coefficient for Tier 2 vehicles to also apply for 
Tier 3 vehicles. This change was inadvertently omitted from the recent 
Tier 3 rulemaking. EPA will also be interested in a broader review of 
the appropriate default value for the catalyst thermal reactivity 
coefficient in some future rulemaking. EPA will be interested in 
reviewing any available data related to this issue.
     Establish a minimum maintenance interval of 1500 hours for 
DEF filters for heavy-duty engines. This reflects the technical 
capabilities for filter durability and the expected maintenance in the 
field.
     Add crankcase vent filters to the list of maintenance 
items for heavy-duty engines. This allows manufacturers to specify a 
maintenance interval of 50,000 miles, or request a shorter interval 
under Sec.  86.004-25. We are also revising consolidating regulatory 
provisions in Sec.  86.004-25 to allow us to remove Sec.  86.007-25; 
this reorganization does not change any regulatory requirements.
     Remove the idle CO standard from 40 CFR 86.007-11 and 40 
CFR 86.008-10. This standard no longer applies, since all engines are 
now subject to diagnostic requirements instead of the idle CO standard.
     Revise 40 CFR 86.094-14 to consolidate the streamlined 
certification procedures for small-volume manufacturers. The 
consolidated section reduces potential confusion by listing only the 
provisions that do not apply, rather than trying to create (and 
maintain) a comprehensive list of all the provisions that apply, in 
addition to the provisions that do not apply. Except for removing 
obsolete content, the revised regulation does not include substantive 
changes to the specified procedures.
     Revise 40 CFR 86.1301 to remove obsolete content.
    EPA is also adopting several amendments to remove obsolete text, 
update cross references, and streamline redundant regulatory text. For 
example, paragraph (f)(3) of Appendix I includes a duty cycle for 
heavy-duty spark-ignition engines that is no longer specified as part 
of the certification process.
(6) Applying 40 CFR Part 1068 to Heavy-Duty Highway Engines and 
Vehicles
    As part of the Phase 1 standards, EPA applied the exemption and 
importation provisions from 40 CFR part 1068, subparts C and D, to 
heavy-duty highway engines and vehicles. EPA also specified that the 
defect reporting provisions of 40 CFR 1068.501 were optional. In an 
earlier rulemaking, EPA applied the selective enforcement auditing 
under 40 CFR part 1068, subpart E (75 FR 22896, April 30, 2010). EPA is 
in this rule adopting the rest of 40 CFR part 1068 for heavy-duty 
highway engines and vehicles, with certain exceptions and special 
provisions.
    40 CFR part 1068 captures a range of compliance provisions that are 
common across our engine and vehicle programs. These regulatory 
provisions generally provide the legal framework for implementing a 
certification-based program. 40 CFR part 1068 works in tandem with the 
standard-setting part for each type of engine/equipment. This allows 
EPA to adopt program-specific provisions for emission standards and 
certification requirements for each type of engine/equipment while 
taking a uniform approach to the compliance provisions that apply 
generally.

[[Page 73940]]

    Many of the provisions in 40 CFR part 1068 were originally written 
to align with the procedures established in 40 CFR part 85 and part 86. 
EPA expects the following provisions from 40 CFR part 1068 to not 
involve a substantive change for heavy-duty highway engines and 
vehicles:
     Part 1068, subpart A, describes how EPA handles 
confidential information, how the Administrator may delegate decision-
making within the agency, how EPA may enter manufacturers' facilities 
for inspections, what information manufacturers must submit to EPA, how 
manufacturers are required to use good engineering judgment related to 
certification, and how EPA may require testing or perform testing. 
There is also a description of labeling requirements that apply 
uniformly for different types of engines/equipment.
     The prohibited acts, penalties, injunction provisions, and 
related requirements of 40 CFR 1068.101 and 1068.125 correspond to what 
is specified in Clean Air Act sections 203 through 207 (also see 
section 213(d)).
     40 CFR 1068.103 describes how a certificate of conformity 
applies on a model-year basis. With the exception of the stockpiling 
provisions in paragraph (g), as described below, these provisions 
generally mirror what already applies for heavy-duty highway engines.
     40 CFR 1068.120 describes requirements that apply for 
rebuilding engines. This includes more detailed provisions describing 
how the rebuild requirements apply for cases involving a used engine to 
replace a certified engine.
     40 CFR part 1068, subpart F, describes procedural 
requirements for voluntary and mandatory recalls. As noted below, EPA 
is modifying these regulations to eliminate a few instances where the 
part 1068 provisions differ from what is specified in 40 CFR part 86, 
subpart S.
     40 CFR part 1068, subpart G, describes how EPA would hold 
a hearing to consider a manufacturer's appeal of an adverse compliance 
decision from EPA. These procedures apply for penalties associated with 
violations of the prohibited acts, recall, nonconformance penalties, 
and generally for decisions related to certification. As noted below, 
EPA is migrating these procedures from 40 CFR part 86, including an 
effort to align with EPA-wide regulations that apply in the case of a 
formal hearing.
    EPA is adopting a requirement for manufacturers to comply with the 
defect-reporting provisions in 40 CFR 1068.501. Defect reporting under 
40 CFR 1068.501 involves a more detailed approach for manufacturers to 
track possible defects and establishes thresholds to define when 
manufacturers must perform an investigation to determine an actual rate 
of emission-related defects. These thresholds are scaled according to 
production volumes, which allows us to adopt a uniform protocol for 
everything from locomotives to lawn and garden equipment. Manufacturers 
that also produce nonroad engines have already been following this 
protocol for several years. These defect-reporting requirements are 
also similar to the rules that apply in California.
    40 CFR part 1068 includes a definition of ``engine'' to clarify 
that an engine becomes subject to certification requirements when a 
crankshaft is installed in an engine block. At that point, a 
manufacturer may not ship the engine unless it is covered by a 
certificate of conformity or an exemption. Most manufacturers have 
opted into this definition of ``engine'' as part of the replacement 
engine exemption as specified in 40 CFR 85.1714. We are making this 
mandatory for all manufacturers. A related provision is the definition 
of ``date of manufacture,'' which we use to establish that an engine's 
model year is also based on the date of crankshaft installation. To 
address the concern that engine manufacturers might install a large 
number of crankshafts before new emission standards start to apply as a 
means of circumventing those standards, we state in 40 CFR 1068.103(g) 
that manufacturers must follow their normal production plans and 
schedules for building engines in anticipation of new emission 
standards. In addition to that broad principle, we state that we will 
consider engines to be subject to the standards for the new model year 
if engine assembly is not complete within 30 days after the end of the 
model year with the less stringent standards.
    40 CFR part 1068 also includes provisions related to vehicle 
manufacturers that install certified engines. EPA states in 40 CFR 
1068.105(b) that vehicle manufacturers are in violation of the 
tampering prohibition if they do not follow the engine manufacturers' 
emission-related installation instructions, which we approve as part of 
the certification process.
    40 CFR part 1068 also establishes that vehicles have a model year 
and that installing certified engines includes a requirement that the 
engine be certified to emission standards corresponding to the 
vehicle's model year. An exception to allow for normal production and 
build schedules is described in 40 CFR 1068.105(a). This ``normal-
inventory'' allowance is intended to allow for installation of 
previous-tier engines that are produced under a valid certificate by 
the engine manufacturer shortly before the new emission standards start 
to apply. Going beyond normal inventory is considered to be 
``stockpiling.'' Stockpiling such engines will be considered an 
unlawful circumvention of the new emission standards. The range of 
companies and production practices is much narrower for heavy-duty 
highway engines and vehicles than for nonroad engines and equipment. 
EPA is therefore finalizing the proposed additional specifications to 
define or constrain engine-installation schedules that will be 
considered to fall within normal-inventory practices. In particular, 
vehicle manufacturers must follow their normal production schedules to 
use up their supply of ``previous-tier'' engines once new emission 
standards start to apply; the regulation further specifies that this 
allowance may not extend beyond three months into the year in which new 
standards apply. For any subsequent installation of previous-tier 
engines, EPA requires that vehicle manufacturers get EPA approval based 
on a demonstration that the excess inventory is a result of 
unforeseeable circumstances rather than circumvention of emission 
standards. EPA approval in those circumstances will be limited to a 
maximum of 50 engines to be installed for up to three additional months 
for a single vehicle manufacturer.
    We are finalizing these stockpiling provisions, although we 
received two comments that supported changes from the proposal. Daimler 
suggested a greater allowance of 1000 or more engines meeting the 
earlier tier of standards to correspond to prevailing production 
volumes. This comment appears to reflect an expectation that engine 
manufacturers would continue to produce these previous-tier engines 
after the new emission standards have started to apply; however, this 
is not the case. The inventory allowance is focused on vehicle 
manufacturers using up their normal inventories of engines that were 
built before the change in emission standards over some number of 
months into the New Year. Even high-volume vehicle manufacturers should 
not be buying large quantities of engines shortly before a change in 
emission standard. The inventory allowance rather allows for vehicle 
manufacturers to prudently plan to make a reasonable transition to the 
new

[[Page 73941]]

engines in the months following the point at which the standards start 
to apply.
    Gillig also commented on the stockpiling provisions, advocating a 
June 30 date for using up their inventory of previous-tier engines. 
Their production schedule typically involves building a single bus in a 
day, with the transition to new standards depending on engine 
manufacturers to provide compliant engines in a timely manner. The 
proposed allowance was intended to accommodate current business 
practices that involved using up normal inventory of previous-tier 
engines within three months after new standards start to apply, with a 
possible extension to six months if the manufacturer needs additional 
time to use up the last few of its normal inventory of previous-tier 
engines. We believe this approach is consistent with Gillig's 
recommendation.
    EPA considered applying 40 CFR part 1068 broadly. It is relatively 
straightforward to apply the provisions of this part to all engines 
subject to the criteria emission standards in 40 CFR part 86, subpart 
A, and the associated vehicles. Manufacturers of comparable nonroad 
engines are already subject to all these provisions. However, highway 
motorcycles and Class 2b and 3 heavy-duty vehicles subject to criteria 
emission standards under 40 CFR part 86, subpart S, are covered by a 
somewhat different compliance program. EPA is therefore applying only 
the hearing procedures from 40 CFR part 1068 for highway motorcycles, 
light-duty vehicles, light-duty trucks, medium-duty passenger vehicles, 
and chassis-certified Class 2b and 3 heavy-duty vehicles. See Section 
XIII.D.(1) for a description of the hearing procedures from 40 CFR part 
1068.
    Note that EPA is amending 40 CFR 85.1701 to specify that the 
exemption provisions of 40 CFR part 85, subpart R, apply to heavy-duty 
engines subject to regulation under 40 CFR part 86, subpart A. This is 
intended to limit the scope of this provision so that it does not apply 
for Class 2b and 3 heavy-duty vehicles subject to standards under 40 
CFR part 86, subpart S. This change corrects an inadvertently broad 
reference to heavy-duty vehicles in 40 CFR 85.1701.

B. Amendments Affecting Glider Vehicles and Glider Kits

(1) Background
    EPA proposed several amendments related to both criteria pollutant 
and GHG emissions from glider vehicles, as well as related provisions 
for glider kits.\980\ With respect to criteria pollutant emissions, EPA 
proposed that as of January 1, 2018, most donor engines installed in 
glider vehicles would have to meet criteria pollutant standards 
corresponding to the year of assembly of the glider vehicle. This would 
amend the provision allowing donor engines to meet the standards for 
the year of the engine. 40 CFR 1037.150(j). EPA further solicited 
comment on an earlier effective date for this provision. 80 FR 40529.
---------------------------------------------------------------------------

    \980\ Glider vehicles are motor vehicles produced to accept 
rebuilt engines (or other used engines) along with used axles and/or 
transmissions. The common commercial term ``glider kit'' is used 
here primarily to refer to a chassis into which the used/rebuilt 
engine is installed. See Figure I-1 in section I.E.1 of this 
Preamble, showing a picture of a glider kit.
---------------------------------------------------------------------------

    With respect to GHG emissions, EPA proposed that all glider 
vehicles (whether produced by large or small manufacturers) meet the 
Phase 2 vehicle standards (which, among other things, would entail 
glider kit manufacturers generating fuel maps for each engine that 
would be used). This would remove a transition provision from the Phase 
1 rules which allowed glider vehicles to use engines not certified to 
the Phase 1 standards. 40 CFR 1037.150(j). Glider vehicles produced by 
large manufacturers are presently subject to the Phase 1 vehicle 
standards, but those produced by small manufacturers are not. 40 CFR 
1037.150(c). Put a different way, the combination of these two 
provisions means that non-small businesses could use pre-2013 engines 
in glider vehicles, but were required to meet (and certify to) the 
Phase 1 GHG vehicle standards. EPA proposed to require all glider 
vehicles to meet the applicable GHG standards as of January 1, 2018. 
See generally 80 FR 40528.
    In the March, 2016 Notice of Data Availability, EPA solicited 
further comment on possible exceptions to the proposal.\981\ 
Specifically, EPA solicited comment with respect to engines meeting 
2010 criteria pollutant standards, and for engines still within their 
original regulatory useful life. 81 FR 10826.\982\
---------------------------------------------------------------------------

    \981\ The NODA requested comment on an EPA memorandum ``Legal 
Memorandum Discussing Issues Pertaining to Trailers, Glider 
Vehicles, and Glider Kits under the Clean Air Act'', February 2016, 
EPA-HQ-OAR-2014-0827-1627, 81 FR 10826.
    \982\ Glider vehicles and glider kits are exempt from NHTSA's 
Phase 1 fuel consumption standards. NHTSA did not propose revisions 
specific to glider vehicles in this rulemaking.
---------------------------------------------------------------------------

    EPA received many comments from manufacturers of both glider kits 
and glider vehicles, many comments from manufacturers of engines 
meeting current criteria pollutant standards and dealers selling trucks 
containing those compliant engines, and comments from the NGO community 
and from CARB. Engine and vehicle manufacturers took opposing 
positions. Some supported the proposed approach, and urged an earlier 
effective date to avoid a pre-buy of glider vehicles with highly 
polluting engines. Others stated that the proposed provisions exceeded 
EPA's authority to set emission standards for new engines and new 
vehicles, in addition to objecting to the proposed provisions as a 
matter of policy. See Section I.E.1 of this document and RTC Section 
14.2. Some of the comments helped EPA target flexibility for glider 
vehicles that serve arguably legitimate purposes (such as reclaiming 
relatively new powertrains from vehicles chassis that fail 
prematurely), without causing substantial adverse environmental 
impacts. All of these comments are fully summarized and responded to in 
RTC Section 14.2. We set out here the actions we are taking in this 
Phase 2 rule, and then explain the basis for those actions.
(2) Overview of Final Rule Provisions for Glider Kits and Glider 
Vehicles
    We are finalizing the proposed glider-related provisions but have 
made several revisions in recognition of the differences between glider 
vehicles produced to avoid the 2010 criteria pollutant emission 
standards and those manufactured for other more legitimate purposes. 
The provisions being finalized are intended to allow a transition to a 
long-term program in which manufacture of glider vehicles better 
reflects the original reason manufacturers began to offer these 
vehicles--to allow the reuse of relatively new powertrains from damaged 
vehicles.
    Under the provisions being finalized for the long-term program, all 
glider vehicles will need to be covered by both vehicle and engine 
certificates. The vehicle certificate will require compliance with the 
GHG vehicle standards of 40 CFR part 1037. The engine certificate will 
require compliance with the GHG engine standards of 40 CFR part 1036, 
plus the criteria pollutant standards of 40 CFR part 86. Used/rebuilt/
remanufactured engines may be installed in the glider vehicles without 
meeting standards for the year of glider vehicle assembly, provided the 
engines are within their regulatory useful life (or meet similar 
criteria). These engines would still need to meet criteria pollutant 
standards corresponding to the year of the engine.
    EPA is also finalizing a transitional program that will allow 
glider vehicle manufacturers additional flexibility. The first step 
allows each

[[Page 73942]]

manufacturer's combined production of glider kits and glider vehicles 
with higher polluting engines to be at the manufacturer's highest 
annual production of glider kits and glider vehicles for any year from 
2010 to 2014.\983\ Any glider vehicles produced in greater volumes 
would need to meet the engine standards corresponding to the year of 
the assembly of the glider vehicle. With respect to GHG standards, all 
vehicles within this allowance will remain subject to the existing 
Phase 1 requirements for both engines and vehicles, so that small 
manufacturers would still be exempt from these provisions up to the 
allowance. Any glider kits and glider vehicles produced beyond this 
allowance will be subject to all requirements applicable to new engines 
and new vehicles for MY 2017. Other than the 2017 production limit, EPA 
will continue the Phase 1 approach until January 1, 2018. This allows 
small businesses to produce glider kits and glider vehicles up to the 
production limit without new constraints. Large manufacturers producing 
complete glider vehicles remain subject to the 40 CFR part 1037 GHG 
vehicle standards, as they have been since the start of Phase 1. 
However large manufacturers may provide exempted glider kits to small 
businesses during this time frame.
---------------------------------------------------------------------------

    \983\ Although discussed here as a limit on the number of glider 
vehicles that may be produced, these provisions are actually 
exemptions for manufacturers from the more generally applicable 
restrictions on the production of glider vehicles, as the following 
sentence in the text above makes clear.
---------------------------------------------------------------------------

    Effective January 1, 2018, the long-term program begins generally, 
but with certain transitional flexibilities. In other words, except for 
the following allowances, glider vehicles will need to comply with the 
long-term program. The exceptions are:
     Small businesses may produce a limited number of glider 
vehicles without meeting either the engine or vehicle standards of the 
long-term program. Larger vehicle manufacturers may provide glider kits 
to these small businesses without the assembled vehicle meeting the 
applicable vehicle standards. This number is limited to the small 
vehicle manufacturer's highest annual production volume in 2010 through 
2014 or 300, whichever is less.
     Model year 2010 and later engines are not required to meet 
the Phase 1 GHG engine standards.
     Used/rebuilt/remanufactured engines may be installed in 
the glider vehicles without meeting standards for the year of glider 
vehicle assembly, provided the engines are within their regulatory 
useful life (this provision continues from the transitional program).
    These 2018 allowances mostly continue after 2020, but effective 
January 1, 2021, all glider vehicles will need to meet the Phase 2 GHG 
vehicle standards. This means that large manufacturers providing glider 
kits to small manufacturers will need to meet the GHG vehicle standards 
for the completed vehicle (pursuant to the delegated assembly 
provisions), or ship the glider kit to the final glider vehicle 
manufacturer pursuant to the incomplete vehicle provisions (where the 
final glider vehicle manufacturer would be the certificate holder).
    EPA is thus discontinuing both 40 CFR 1037.150(c) and (j) in this 
Phase 2 rulemaking. As finalized, the Phase 2 regulations will 
therefore generally treat glider vehicles the same as other new 
vehicles.\984\ As a result, glider vehicles must be certified to the 
Phase 2 vehicle GHG standards, which (among other things) require a 
fuel map for the actual engine in order to run GEM. In other words, 
manufacturers producing glider kits need to meet the applicable GHG 
vehicle standards and, as part of their compliance demonstration, need 
to have a fuel map for each engine used. Alternatively, the final 
assembler could be the entity to obtain the certificate, provided it 
had substantial control of the overall emissions performance of the 
completed vehicle. In either case, manufacturers unable to obtain a 
fuel map for an engine may ask to use a default map, consistent with 
good engineering judgment.
---------------------------------------------------------------------------

    \984\ EPA has structured these regulations for glider vehicles 
to lay out a general requirement that treats glider vehicles (and 
the engines installed in them) the same as other new vehicles (and 
new engines), but also includes several exemptions from this general 
requirement.
---------------------------------------------------------------------------

    EPA is also providing a limited allowance for small business 
manufacturers as described in 40 CFR 1037.150(t), and also providing a 
generally-applicable allowance that is conditioned on the age of the 
reused engine as described in 1037.635. See Section XIII.B.(4) below. 
EPA is also adopting new definitions of ``glider vehicle'' and ``glider 
kit'' in 40 CFR 1037.801 that are generally consistent with the common 
understanding of these terms as meaning new chassis with a rebuilt or 
other used engine and new chassis designed to accept a rebuilt or other 
used engine/powertrain. EPA is also clarifying its requirements for 
certification and revising its definitions for glider manufacturers, as 
described below, to ensure that affected manufacturers understand their 
responsibilities under the regulations.
    It is important to emphasize that EPA is not banning gliders. 
Rather, as described below, EPA is requiring that glider vehicles meet 
the standards that all other new trucks are required to meet, unless 
eligible for certain limited exemptions that provide flexibility for 
small businesses and for certain other specific applications. Moreover, 
the provisions being finalized are more flexible than those proposed, 
but focus the additional flexibility on vehicles using relatively clean 
engines, and on engines within their regulatory useful life, consistent 
with the original purpose of glider kits and vehicles.\985\
---------------------------------------------------------------------------

    \985\ Although discussed here as a limit on the number of glider 
vehicles that may be produced, these provisions are actually 
exemptions for manufacturers from the more generally applicable 
restrictions on the production of glider vehicles.
---------------------------------------------------------------------------

    EPA proposed to begin these requirements January 1, 2018, but 
requested comment on beginning the requirements sooner. Since the NPRM, 
production of gliders has surged and now likely exceeds 10,000 per 
year. We are concerned that by finalizing restrictions for 2018 in this 
rule we risk causing a pre-buy scenario where production surges further 
in 2017. This would be both very harmful to the environment and 
disruptive to the market. To avoid these problems and to ensure a 
smoother transition, we are finalizing a glider kit and glider vehicle 
production limit for calendar year 2017 for glider vehicles using high 
polluting engines. The allowable production is based on past sales for 
all large and small manufacturers. Specifically, each manufacturer's 
combined 2017 production of glider kits and glider vehicles using high 
polluting engines will be capped at the manufacturer's highest annual 
production of glider kits and glider vehicles for any year from 2010 to 
2014. All vehicles within this allowance will remain subject to the 
existing Phase 1 GHG provisions as they presently apply. Any glider 
kits or glider vehicles produced beyond this allowance will be subject 
to all requirements applicable to new engines and new vehicles for MY 
2017.
(3) Impacts of Current Glider Market
    Current standards for NOX and PM (which began in 2007 
and took full effect in 2010) are at least 90 percent lower than the 
most stringent previously applicable standards, so the NOX 
and PM emissions of any glider vehicles using pre-2007 engines are at 
least ten times higher than emissions from equivalent vehicles being 
produced with brand new engines.\986\ However,

[[Page 73943]]

most gliders being produced today use engines originally manufactured 
before 2002.\987\ Since these pre-2002 engines lack both EGR and 
exhaust aftertreatment, they would have NOX and PM emissions 
20-40 times higher than current engines. If miscalibrated, emissions 
could be even higher. Thus, each glider vehicle using an older engine 
that is purchased instead of a new vehicle with a current MY engine 
results in significantly higher in-use emissions of air pollutants 
associated with a host of adverse human health effects, including 
premature mortality (see Section VIII above).
---------------------------------------------------------------------------

    \986\ The NOX and PM standards for MY 2007 and later 
engines are 0.20 g/hp-hr and 0.01 g/hp-hr, respectively. The 
standards for MY 2004 through 2006 engines were ten times these 
levels, and earlier standards were even higher.
    \987\ See, e.g. http://www.truckinginfo.com/article/story/2013/04/the-return-of-the-glider.aspx, describing the engines used by a 
leading manufacturer of glider vehicles (``1999 to 2002-model 
diesels were known for reliability, longevity and good fuel mileage. 
Fitzgerald favors Detroit's 12.7-liter Series 60 from that era, but 
also installs pre-EGR 14-liter Cummins and 15-liter Caterpillar 
diesels. All are rebuilt . . . . '') (emphasis added). See also 
additional documentation of this point in RTC Section 14.2.
---------------------------------------------------------------------------

    These emission impacts have been compounded by the increasing sales 
of these vehicles. Estimates provided to EPA indicate that production 
of glider vehicles has increased by an order of magnitude from what it 
was in the 2004-2006 time frame--from a few hundred each year to 
thousands.\988\ Glider vehicle production is not currently being 
reported to EPA, but EPA estimates that current production is close to 
10,000 each year based on comments--including comments from 
manufacturers of glider vehicles. While the few hundred glider vehicles 
produced annually in the 2004-2006 timeframe may have been produced for 
arguably legitimate purposes, such as salvaging powertrains from 
vehicles otherwise destroyed in crashes, EPA believes (as did many 
commenters) that the more than tenfold increase in glider kit 
production since the MY 2007 criteria pollutant emission standards took 
effect reflects an attempt to avoid these more stringent standards and 
(ultimately) the Clean Air Act.
---------------------------------------------------------------------------

    \988\ ``Industry Characterization of Heavy Duty Glider Kits,'' 
MacKay & Company, September 30, 2013.
---------------------------------------------------------------------------

    At proposal, EPA estimated the environmental impact of 5,000 glider 
vehicles per year, which would be roughly 2 percent of the Class 8 
vehicles manufactured annually.\989\ We estimated that at that rate, 
these gliders could account for as much as one-half of total 
NOX and PM emissions from all new Class 8 vehicles. Several 
commenters supported EPA's assessment of the environmental impacts of 
glider vehicles. Volvo suggested the impacts were even greater, 
estimating that 2014 glider sales were ``on the order of 6,000'' and 
that they emit twice as many tons of PM as the rest of the 2014 
vehicles. In later supplemental comments, Volvo provided evidence that 
current sales have grown to 10,000 or more per year. Even some 
commenters opposing EPA's proposal acknowledged that glider sales are 
now over 10,000 units annually. No commenters disagreed with EPA's 
previous (understated) assessment of NOX and PM impacts.
---------------------------------------------------------------------------

    \989\ Frequently Asked Questions about Heavy-Duty ``Glider 
Vehicles'' and ``Glider Kits,'' EPA-420-F-15-904, July 2015.
---------------------------------------------------------------------------

    For the final rule, EPA has updated its analysis of the 
environmental impacts of gliders. The updated analysis used the same 
emissions modeling tool used to estimate the other emissions impacts of 
the rule, described in Section VII of the Preamble. The modeling of 
gliders assumed annual glider sales of 10,000 for 2015 and later, 
consistent with the comments received on the proposal. The modeling 
also assumed that these gliders emit at the level equivalent to the 
engines meeting the MY 1998-2001 standards, since most glider vehicles 
currently being produced use remanufactured engines of this vintage, 
and projects them to have the same usage patterns/lifetimes as similar 
new vehicles. (We did not attempt to account for any miscalibration of 
these engines). This analysis shows that without the new restrictions, 
glider vehicles on the road in 2025 would emit nearly 300,000 tons of 
NOX and nearly 8,000 tons of PM annually. Although glider 
vehicles would make up only 5 percent of heavy-duty tractors on the 
road, their emissions would represent about one third of all 
NOX and PM emissions from heavy-duty tractors in 2025. By 
restricting the number of glider vehicles with high polluting engines 
on the road, these excess PM and NOX emissions will decrease 
dramatically, leading to substantial public health-related benefits. 
Put into monetary terms using PM-related benefit-per-ton values 
described in Section IX.H, the removal of all unrestricted glider 
vehicle emissions from the atmosphere would yield between $6 to $14 
billion in benefits annually (2013$). It is clear that removing even a 
fraction of these glider vehicles with high polluting engines from the 
road will yield substantial health-related benefits.
(4) EPA Engine Standards
    EPA is thus amending its rules to generally require that glider 
vehicles produced on or after January 1, 2017 use engines certified to 
the standards applicable to the calendar year in which assembly of the 
glider vehicle is completed, with an exception in 2017 that provides a 
larger number of glider vehicles under the transitional production 
allowance. (Other exceptions to this general requirement are discussed 
later). This requirement applies to all pollutants, and thus 
encompasses criteria pollutant standards as well as the separate GHG 
standards. Used or rebuilt engines may be used, as long as they have 
been certified to the same standards that apply for the calendar year 
of glider vehicle assembly. For example, if assembly of a glider 
vehicle is completed in calendar year 2020, the engine must generally 
meet standards applicable for MY 2020. (If the engine standards for 
model year 2020 are the same as for model years 2017 through 2019, then 
any model year 2017 or later engine may be used).
    EPA is amending these rules because, with the advent in MY 2007 of 
more stringent HD diesel engine criteria pollutant standards, 
continuation of provisions allowing unlimited use of rebuilt and reused 
engines meeting much earlier MY criteria pollutant standards results in 
unnecessarily high in-use emissions. See Section XII.B.(3) above. As 
stated there, these emissions form an increasingly high percentage of 
the vehicular inventory for such dangerous pollutants as NOX 
and diesel exhaust PM (a likely human carcinogen), all of which are 
associated with the most serious adverse health effects up to and 
including premature mortality. GHG emissions from these engines also 
are controllable. As more glider vehicles are produced, EPA believes 
these emissions should be controlled to the same levels as other new 
engines.
    The older engines currently being used in most glider vehicles 
could be retrofitted with exhaust aftertreatment to meet current 
standards. However, the primary reason these engines have been used is 
because they do not include aftertreatment.\990\ Thus, we believe 
retrofitting these engines would not be a preferred path. The more 
likely compliance path would be to install a used 2010 or later engine, 
since such engines are presently available and it would be probably be 
much simpler and less expensive to use a 2010 engine than to retrofit 
an older engine to meet current standards. Manufacturers will

[[Page 73944]]

likely also seek to qualify under other flexibilities provided in the 
Final Rule.
---------------------------------------------------------------------------

    \990\ http://www.truckinginfo.com/article/story/2013/04/the-return-of-the-glider.aspx., accessed July 16, 2016.
---------------------------------------------------------------------------

    Recognizing that the environmental impacts of gliders using newer 
engines will generally be much smaller, EPA requested comment on 
whether we should treat such gliders differently than gliders using 
older engines. 80 FR 40528; 81 FR 10826. Based on comments received on 
the NODA, EPA is finalizing additional flexibilities for newer engines 
and for engines with very low mileage. More specifically, EPA will 
allow engines meeting any of the following criteria to be used in 
glider vehicles without meeting current engine standards for either 
criteria pollutants or GHGs:
    (1) Engines still within their original useful life in terms of 
both miles and years.
    (2) Engines of any age with less than 100,000 miles of engine 
operation, provided the engines' miles are properly documented.
    (3) Engines less than three years old with any number of 
accumulated miles of engine operation.\991\
---------------------------------------------------------------------------

    \991\ EPA's authority to craft different provisions for engines 
within their useful life, and provisions allowing continued 
production of glider vehicles using pre-2010 engines comes from CAA 
authority to consider costs under section 202(a)(2) and 
202(a)(3)(D), as well as the broad authority in section 202(a)(3)(D) 
over engine rebuilding. Thus, many of these flexibilities are 
tailored to avoid significant and disproportionate economic impacts 
on small business glider vehicle manufacturers by allowing most 
small businesses to continue to produce glider vehicles consistent 
with current levels of production, consistent with the 
recommendations of the Small Business Advocacy Review panel. See RIA 
section 12.7.3. Allowing continued use of engines within their 
original useful life is also consistent with one purpose of the 
engine rebuilding provisions, which is to find some legitimate means 
of salvaging heavy duty engines without backsliding from those 
engines' original certified condition. See 62 FR 54702.
---------------------------------------------------------------------------

    Engines covered by these three criteria are consistent with the 
original intended use of glider kits--the salvaging of relatively new 
powertrains from vehicle chassis that have been damaged or have 
otherwise failed prematurely. Most of these engines would be covered by 
the first criterion. While nearly all of these engines would be model 
year 2010 or later, this criterion would theoretically allow use of 
model year 2008 or 2009 engines in calendar years before 2020. 
Nevertheless, such engines would have been certified to the same PM 
standards as the 2010 engines, and would likely have NOX 
emissions at or below 1.2 g/hp-hr (i.e., the typical certification 
level for engines of that vintage). EPA is adopting the second 
criterion to address very rare cases that were identified in comments 
in which annual VMT is so low that engines would not reach 100,000 
miles within ten years (the useful life in years). These engines could 
be higher emitting, but would necessarily be in applications with very 
low usage, such as a small town fire truck. As such, the total 
emissions from such vehicles would be very small. The third criterion 
would address other rare cases such as where an engine is just outside 
the useful life in miles, or the miles cannot be determined. These 
engines would necessarily be model year 2015 or later, and would thus 
all meet the 2010 standards. Considered together, this additional 
flexibility would have little adverse emission impact because there 
would be relatively few engines covered by these exceptions and the 
vast majority would be 2010 or later.
    Several commenters supported allowing unlimited production of 
glider vehicles if they use engines certified to 2010 or later 
NOX and PM standards, without regard to whether the engines 
were still within their useful life. EPA sees merit in this concept, 
but is concerned that it may not be appropriate in perpetuity. 
Obviously, reuse of engines originally certified to the 2010 standards 
for criteria pollutants would not have the same adverse environmental 
impacts as the current practice of reusing pre-2002 engines that have 
NOX and PM emissions 20-40 times higher than current engines 
(or using post-2002 but pre-2007 engines, which remain an order of 
magnitude more polluting). However, they would not necessarily be as 
clean for GHG or criteria pollutants as brand new engines with all new 
aftertreatment components. The Phase 1 and Phase 2 engine standards 
mean that brand new engines will have lower GHG emissions than pre-
Phase 1 engines. See RIA Chapter 8 and RTC Section 14.2. And used 2010 
aftertreatment components may be less effective at reducing 
NOX or PM than when new. Moreover, EPA has been petitioned 
to adopt more stringent NOX and/or PM standards in the 
future. See Section I.F.(1) above. Thus, while using 2010 engines in 
glider vehicles would greatly reduce the most serious concerns about 
NOX and PM emissions relative to current gliders, it would 
not eliminate all adverse environmental impacts.
    To balance these factors, EPA is finalizing an interim provision--a 
provision which may sunset if EPA adopts new more stringent 
NOX or PM standards for heavy duty engines--that will treat 
gliders using MY 2010 and later engines the same as those using engines 
within their useful life. This would avoid most of the adverse impacts, 
especially for NOX and PM. Not requiring these engines to 
meet the latest GHG standards could have some impacts, but they would 
likely be small, especially if glider vehicle sales return to pre-2007 
levels. EPA will continue to monitor sales patterns and may rescind 
this flexibility in a future rulemaking.
    Several commenters expressed concern about the impact of the 
proposed changes on small businesses that produce glider vehicles. 
However, commenters opposing the proposed requirements/clarifications 
did not address the very significant adverse environmental impacts of 
the huge increase in glider vehicle production over the last several 
years. EPA recognized at the time of the proposal that production of a 
smaller number of other gliders by small manufacturers may be 
appropriate, at least as an interim allowance. 80 FR 40529. To allow 
this, EPA is adopting the proposed provision that will somewhat 
preserve the regulatory status quo for existing small businesses, 
allowing limited production using highly polluting engines based on 
recent sales. This means a limited number of glider vehicles produced 
by small businesses may use older rebuilt or used engines, provided 
those engines were certified to standards from the year of the engine's 
manufacture. (Note that beginning in MY 2021, these vehicles will have 
to meet the GHG vehicle standards, although they would not be required 
to meet current criteria pollutant standards.) For example, an existing 
small business that produced glider vehicles between 2010 and 2014, 
with a peak production of 200 in 2013, may produce up to 200 glider 
vehicles per year under without having to certify them to the GHG 
standards, or re-certifying the engines to the now-applicable EPA 
standards for criteria pollutants (so long as the engine is certified 
to criteria pollutant standards for the year of its manufacture). To be 
eligible for this provision, 40 CFR 1037.150(t), the regulation 
specifies that no small entity may produce more than 300 glider 
vehicles (including any glider kits it sells to another assembler) 
using the older engines in any given model year without recertifying 
the engines to current EPA standards. EPA believes that this level 
reflects the upper end of the range of production that occurred before 
significant avoidance of the 2007 criteria pollutant standards began. 
EPA believes that, given this relief combined with the other changes 
being made into the final regulations, any small businesses that have 
been focused on producing gliders for legitimate purposes will not be 
significantly

[[Page 73945]]

impacted by the new requirements, since they can use donor engines 
within their regulatory useful life for either age or mileage. See 
generally RIA Chapter 12.7.3. Only those small businesses that have 
significantly increased production to create new trucks to avoid the 
2010 NOX and PM standards will have their sales 
significantly restricted.
    This small business flexibility is intended for small entities for 
whom glider production is a substantial portion of their revenue to 
allow them to transition to the long-term program where they would 
generally install newer cleaner engines. (We recognize that the final 
regulations will allow some small businesses to produce a limited 
number of glider vehicles with higher polluting engines as a side 
business, but do not expect these manufacturers to produce very many 
glider vehicles.) We intend to monitor its use and may place additional 
restriction on this flexibility in the future consistent with this 
intended purpose.
    We are also adopting provisions to facilitate a smoother transition 
for small businesses that assemble glider vehicles from glider kits 
produced by larger manufacturers. Although the long-term program will 
require vehicle certificates for glider vehicles produced by small 
manufacturers using exempted engines, we are delaying the requirement 
for a vehicle certificate until 2021 for these glider vehicles. This 
means the large glider kit manufacturers may continue the Phase 1 
allowance to sell exempted glider kits (i.e., uncertified glider kits) 
to small assemblers as previously allowed under Phase1 by 40 CFR 
1037.620. However, beginning January 1, 2021, each glider kit sold to 
small assemblers will need to have a vehicle certificate the same as is 
required for other new Phase 1 and Phase 2 glider vehicles.
    Although we are allowing this flexibility for glider kit 
manufacturers, they remain responsible to take reasonable steps to 
ensure that their glider kits are not used to produce complete vehicles 
in violation of the regulations. Most importantly, the glider kit 
manufacturer must comply fully with the requirements of 40 CFR 
1037.622, which specifies certain minimum requirements for shipping 
uncertified incomplete vehicles. If the glider kit manufacturer is the 
certificate holder, then the glider kit manufacturer would have to 
comply with the delegated assembly requirements of 40 CFR 1037.621. See 
40 CFR 1037.635(d)(3). In addition, we would expect manufacturers of 
glider kits to have records to verify that the vehicle assembler to 
whom they are shipping an uncertified glider kit (which would remain 
permissible under Phase 1) is aware of the regulatory requirements and 
is eligible to produce glider vehicles with older engines that do not 
meet current criteria pollutant standards (i.e. is a small business 
within the volume limit, or is using engines within their regulatory 
useful life). For any assembler that is purchasing more than one 
hundred glider kits in a year from a kit manufacturer, the kit 
manufacturer should verify that they are not exceeding their allotted 
number. For smaller assemblers, it may be sufficient to verify that 
they are not requesting more glider kits from that kit manufacturer 
than they purchased in any year from 2010 to 2014. Failure to comply 
with these requirements, or shipping glider kits to an ineligible 
manufacturer which produces glider vehicles with non-compliant engines, 
may void the exemption granted pursuant to 40 CFR 1037.621 or 1037.622. 
For example, as explained in Section I.E.(1)(d) above, supplying glider 
kits to an ineligible manufacturer could result in causing a violation 
of the Act, and thus is itself a prohibited act under section 
203(a)(1).
    Finally, we are adopting a new provision in 40 CFR 1036.150(o) that 
would allow an engine manufacturer to modify a used engine to be 
identical to a previously certified configuration. (This is similar to 
the allowance in 40 CFR 1068.201(i).) This allows the manufacturer to 
include the used engine in an existing certificate for the purposes of 
complying with the requirement to meet current standards when 
installing an engine into a glider vehicle. For example, if an engine 
manufacture modified a used 2009 engine to be identical to a certified 
2017 engine, we would allow the 2009 engine to be covered by the 2017 
certificate, which would allow it to be installed into a glider vehicle 
without restriction.
(5) Lead Time for Amended Provisions
    Other than the production volume provision discussed at the 
beginning of this Section XIII.B, the requirement for gliders to meet 
engine and vehicle standards applicable to other new vehicles and 
engines do not take effect before January 1, 2018. With respect to the 
criteria pollutant engine standards, EPA believes this provides 
sufficient time to ``permit the development and application of the 
requisite control measures'' (CAA section 202(a)(3)(D)) because 
compliant engines are available today, although manufacturers will need 
several months to change business practices to comply.
    Some commenters argued that because some of these requirements 
relate to criteria pollutant standards, EPA must provide at least four 
years lead time pursuant to section 202(a)(3)(C) of the Clean Air Act. 
EPA addresses these comments in Section I.E.(1) and in the RTC Sections 
1.3.1 and 14.2. With respect to the vehicle standards, EPA notes that 
the requirements already apply for vehicles not produced by small 
businesses. EPA believes that delaying the applicability of the vehicle 
standards to small businesses until 2021 when Phase 2 takes effect 
provides ample time to comply with vehicle GHG standards. See CAA 
section 202(a)(2) (standards to provide lead time sufficient to allow 
for ``development and application of the requisite technology'').
(6) Legal Authority and Definitions Under the Clean Air Act
    With respect to statutory authority for the criteria pollutant 
standards under the Clean Air Act, EPA notes first that it has broad 
authority to control all pollutant emissions from ``any'' rebuilt heavy 
duty engines (including engines beyond their statutory useful life). 
See CAA section 202(a)(3)(D). EPA is to give ``appropriate'' 
consideration to issues of cost, energy, and safety in developing such 
standards, and to provide necessary lead time to implement those 
standards. If a used engine is placed in a new glider vehicle, the 
engine will be considered a ``new motor vehicle engine'' because it is 
being used in a new motor vehicle. See CAA section 216(3) and Section 
I.E.(1). With respect to the vehicle-based GHG standards, there is no 
question that the completed glider vehicle is a ``motor vehicle'' under 
the Clean Air Act. Some commenters have questioned whether a glider kit 
(without an engine) is a motor vehicle. However, EPA considers glider 
kits to be incomplete motor vehicles and entities manufacturing gliders 
to be manufacturers of those vehicles, and EPA has the authority to 
regulate incomplete motor vehicles and manufacturers thereof, including 
un-motorized chassis. See Section I.E.(1)
    Under the CAA, it is also important that ``new'' is determined 
based on legal title and does not consider prior use. Thus, glider 
vehicles that have a new vehicle identification number (VIN) and new 
title are considered to be ``new motor vehicles'' even if they 
incorporate previously used components. It is also the case that under 
the Clean Air Act, EPA does not consider the fact that a vehicle 
retained the VIN of the donor vehicle from which the engine was 
obtained determinative of whether or

[[Page 73946]]

not the vehicle is new. See Section I.E.(1) (responding to comment on 
this point).
    The CAA also defines ``manufacturer'' to include any person who 
assembles new motor vehicles. As proposed, EPA is revising its 
regulatory definitions of these terms in 40 CFR 1036.801 and 1037.801 
to more clearly reflect these aspects of the CAA definitions. The 
revised definitions make clear that:
     New glider kits are ``new motor vehicles.'' Manufacturers 
therefor must certify to the Phase 2 vehicle standards unless they are 
selling the glider kit to a secondary manufacturer that has its own 
certificate.
     Previously used engines installed into glider kits are 
``new motor vehicle engines.''
     Any person who completes assembly of a glider vehicle is a 
``manufacturer'' thereof.
    EPA also notes that under existing regulations, glider kit 
assemblers (i.e. entities that assemble the glider vehicle by adding 
the donor engine to the kit) are already considered to be secondary 
vehicle manufacturers, who may receive incomplete vehicles (such as 
glider kits) from OEMs if they have a valid certificate or exemption 
(see 40 CFR 1037.622). Secondary vehicle manufacturers may also receive 
certified glider kits to complete in a delegated assembly agreement 
(see 40 CFR 1037.621).
    To further clarify that EPA considers both glider kits and 
completed glider vehicles to be motor vehicles, EPA is adding a 
clarification to our definition of ``motor vehicle'' in 40 CFR 85.1703 
regarding vehicles such as gliders that clearly are intended for use on 
highways, consistent with the CAA definition of ``motor vehicle'' in 
CAA section 216(2). The regulatory definition previously contained a 
provision stating that vehicles lacking certain safety features 
required by state or federal law are not ``motor vehicles.'' EPA 
recognized that this caveat needed a proper context: Is the safety 
feature one that would prevent operation on highways? See 80 FR 40529. 
If not, absence of that feature does not result in the vehicle being 
other than a motor vehicle. The amendment will consequently make clear 
that vehicles that are clearly intended for operation on highways are 
motor vehicles, even if they do not have every safety feature. This 
clarifying provision takes effect with this rule.
    We note that NHTSA and EPA have separate definitions for motor 
vehicles under their separate statutory authorities. As such, EPA's 
determination of how its statute and regulations apply to glider kits 
and glider vehicles has no bearing on how NHTSA may apply its safety 
authority with regard to them.
(7) Summary of the Requirements for Glider Vehicles
    The provisions being finalized are intended to allow a transition 
to a long-term program in which use of glider kits is permissible 
consistent with the original reason manufacturers began to offer glider 
kits--to allow the reuse of relatively new powertrains from damaged 
vehicles. The long-term program as well as the transitional program are 
summarized below.
(a) Long-Term Program for Gliders
    Ultimately all gliders will need to be covered by both vehicle and 
engine certificates. The vehicle certificate will require compliance 
with the GHG vehicle standards of 40 CFR part 1037. The engine 
certificate will require compliance with the GHG engine standards of 40 
CFR part 1036, plus the criteria pollutant standards of 40 CFR part 86. 
Used/rebuilt engines may be installed in the glider vehicles, provided 
(1) they meet all standards applicable to the year in which the 
assembly of the glider vehicle is completed; or (2) meet all standards 
applicable to the year in which the engine was originally manufactured 
and also meet one of the following criteria:
     The engine is still within its original useful life in 
terms of both miles and years.
     The engine has less than 100,000 miles of engine 
operation.
     The engine is less than three years old.
    In most of these cases, the glider vehicles will need to have a 
vehicle certificate demonstrating compliance with the vehicle GHG 
standards that apply for the year of assembly. However, in the case of 
engines with less than 100,000 miles, glider vehicles conforming to the 
vehicle configuration of the donor vehicle do not need to be 
recertified to current vehicle standards.
(b) Transitional Program for Gliders
    For calendar year 2017, each manufacturer's combined production of 
glider kits and glider vehicles will be capped at the manufacturer's 
highest annual production of glider kits and glider vehicles for any 
year from 2010 to 2014. All vehicles within this allowance will remain 
subject to the existing Phase 1 provisions, including its exemptions. 
Any glider kits or glider vehicles produced beyond this allowance will 
be subject to the long-term program.
    Other than the 2017 production limit, EPA will continue the Phase 1 
approach until January 1, 2018. This allows small businesses to produce 
glider vehicles up to the allowance without other new constraints 
before 2018. Large manufacturers producing complete glider vehicles 
remain subject to the 40 CFR part 1037 GHG vehicle standards, as they 
have been since the start of Phase 1. However large manufacturers may 
provide exempted glider kits to small businesses during this time 
frame. Other than the 2017 production limit, EPA will continue the 
Phase 1 approach until January 1, 2018. This allows small businesses to 
produce glider vehicles up to the cap without other new constraints 
before 2018. Large manufacturers producing complete glider vehicles 
remain subject to the 40 CFR part 1037 GHG vehicle standards, as they 
have been since the start of Phase 1. However large manufacturers may 
provide exempted glider kits to small businesses during this time 
frame.
    Effective January 1, 2018, the permissible number of glider 
vehicles that may be produced without meeting the long-term program 
will be limited to two specific exceptions. The exceptions are:
     Small businesses may produce a limited number of glider 
vehicles without meeting either the engine or vehicle standards of the 
long-term program. Larger vehicle manufacturers may provide glider kits 
to these small businesses without meeting the applicable vehicle 
standards. This number is limited to the small manufacturer's highest 
annual production volume in 2010 through 2014 or 300, whichever is 
less.
     Model year 2010 and later engines are not required to meet 
the Phase 1 GHG engine standards.
    These 2018 allowances mostly continue after 2020, but the following 
change takes effect January 1, 2021:
     All glider kits provided by large manufacturers (including 
to small manufacturers or for use with 2010 engines) must meet the 
vehicle standards for the completed vehicle.
    EPA is not establishing an end to these transitional provisions at 
this time. We intend to monitor this industry and will reevaluate the 
appropriateness of these provisions in the future.

C. Applying the General Compliance Provisions of 40 CFR Part 1068 to 
Light-Duty Vehicles, Light-Duty Trucks, Chassis-Certified Class 
2B and 3 Heavy-Duty Vehicles and Highway Motorcycles

    As described above, EPA is applying all the general compliance 
provisions of 40 CFR part 1068 to heavy-duty engines

[[Page 73947]]

and vehicles subject to 40 CFR parts 1036 and 1037. EPA is also 
applying the amended hearing procedures from 40 CFR part 1068 to 
highway motorcycles and all vehicles subject to standards under 40 CFR 
part 86, subpart S. However, based on comments, we are not finalizing 
broader changes at this time.
    Volvo objected to extending the defect-reporting provisions of 40 
CFR part 1068 to heavy-duty engines and vehicles. They stated that they 
have a robust approach to defect-reporting that is largely consistent 
with what applies under 40 CFR part 1068 (in addition to complying with 
CARB's warranty-reporting requirements), but argued that it would be 
cost-prohibitive to comply nationwide with the new federal 
requirements. They commented that the higher reporting thresholds would 
lead to fewer reports. We understand and accept that there may be fewer 
defect reports; in fact, we count this as a positive development since 
industry and agency efforts toward documenting and addressing defects 
will be focused on cases that are worthy of greater attention. The 
defect threshold of 25 units under 40 CFR part 85 is not appropriate 
for the sales volumes associated with heavy-duty engines and vehicles.
    Light-duty automotive manufacturers also objected to the mandatory 
migration of defect-reporting provisions to 40 CFR part 1068 for heavy-
duty vehicles they produce, emphasizing that their light-duty and 
heavy-duty vehicles should be subject to the same defect-reporting 
protocol to reduce complexity and risk of error. Although we are not 
applying the 40 CFR part 1068 defect-reporting requirements to heavy-
duty vehicles subject to the requirements of 40 CFR part 86, subpart S, 
we are applying them to all other heavy-duty vehicles produced by these 
manufacturers. As noted below, we plan to eventually migrate the 
defect-reporting provisions for all light-duty and heavy-duty vehicles 
to 40 CFR part 1068, and see no harm in doing so in steps. These 
manufacturers also expressed three more detailed concerns about defect 
reporting under 40 CFR part 1068: (1) Twice-annual investigation 
reports may show no defects, which would add a paperwork burden for no 
benefit, (2) the reporting period covers the full useful life, rather 
than just the first five years, which is the time when most defects 
appear, and (3) tying defect reporting to warranty claims may 
discourage extended warranties. The idea behind the investigation 
reports is that a high rate of possible defects may or may not be 
associated with a substantial number of actual defects. The 
investigation reports are intended to address exactly that question. 
The burden arises only when the manufacturer has a high enough rate of 
possible defects to warrant further attention. We see no reason to 
disregard defect information between five years and the end of the 
useful life, since manufacturers are responsible for designing their 
products to last during that entire period. Specifying a shorter period 
would artificially and arbitrarily reduce the information available to 
reach a conclusion. If defects don't occur after five years, then there 
is no additional burden associated with the longer period. EPA does not 
take a position on the manufacturers' practices regarding extended 
warranties; however, we feel strongly that a manufacturer's confidence 
as expressed in an extended warranty should correspond with the same 
level of confidence in the engines (or components) working to control 
emissions for that same period.
    EPA proposed to also apply the recall provisions from 40 CFR part 
1068 for highway motorcycles and for all vehicles subject to standards 
under 40 CFR part 86, subpart S, and requested comment on applying the 
defect reporting from 40 CFR part 1068 for those same vehicles. 
Manufacturers objected to modifying the recall and defect-reporting 
provisions in this rulemaking. EPA is accordingly not finalizing these 
additional provisions; EPA intends rather to pursue these changes in a 
later rulemaking, which will allow both EPA and manufacturers and other 
stakeholders additional time to carefully consider the range of issues 
that may be involved. In particular, EPA anticipates the opportunity to 
apply some learning from the current focus on defeat devices, recall, 
and defect reporting in the effort to update the regulations.
    Note that EPA is amending 40 CFR 85.1701 to specify that the 
exemption provisions apply to heavy-duty engines subject to regulation 
under 40 CFR part 86, subpart A. This is intended to limit the scope of 
this provision so that it does not apply for Class 2b and 3 heavy-duty 
vehicles subject to standards under 40 CFR part 86, subpart S. This 
change corrects an inadvertently broad reference to heavy-duty vehicles 
in 40 CFR 85.1701.

D. Amendments to General Compliance Provisions in 40 CFR Part 1068

    The general compliance provisions in 40 CFR part 1068 apply broadly 
too many different types of engines and equipment. This section 
describes how EPA is amending these procedures to make various 
corrections and adjustments.
(1) Hearing Procedures
    EPA is updating and consolidating its regulations related to formal 
and informal hearings in 40 CFR part 1068, subpart G. This will allow 
us to rely on a single set of regulations for all the different 
categories of vehicles, engines, and equipment that are subject to 
emission standards. EPA also made an effort to write these regulations 
for improved readability.
    The hearing procedures specified in 40 CFR part 1068 apply to the 
various categories of nonroad engines and equipment (along with the 
other provisions of part 1068). EPA is in these rules applying these 
hearing procedures also to heavy-duty highway engines, light-duty motor 
vehicles, and highway motorcycles. EPA believes there is no reason to 
treat any of these sectors differently regarding hearing procedures. 
Automotive and engine manufacturers expressed broad concerns about 
migrating the hearing procedures in this rulemaking; however, the 
migration makes no substantive changes to established procedures, and 
addresses various administrative concerns as noted below.
    EPA is adding an introductory section that provides an overview of 
requesting a hearing for all cases where a person or a company objects 
to an adverse decision by the agency. In certain circumstances, as 
spelled out in the regulations, a person or a company can request a 
hearing before a Presiding Officer. Statutory provisions require formal 
hearing procedures for administrative enforcement actions seeking civil 
penalties. The Clean Air Act does not require a formal hearing for 
other agency decisions; EPA is therefore specifying that informal 
hearing procedures apply for all such decisions.
    The introductory section also adds detailed provisions describing 
the requirements for submitting information to the agency in a timely 
manner. These provisions accommodate current practices for electronic 
submission, distinguish between postal and courier delivery and provide 
separate requirements for shipments made from inside and outside the 
United States. The specified deadlines are generally based on the 
traditional approach of a postmark determining whether a submission is 
timely or not. Fax, email and courier shipments are similarly specified 
as needing to be sent by close of business on the day of the deadline. 
A different approach applies for shipments originating from outside the

[[Page 73948]]

United States. Because time in transit can vary dramatically, we are 
specifying that foreign shipments need to be received in our office by 
the specified deadline to be considered timely. Given the option to 
send documents by email or by fax, EPA expects this approach will not 
pose any disadvantage to anyone making an appeal from outside the 
United States.
    EPA is replacing the current reference to 40 CFR 86.1853-01 for 
informal hearings with a full-text approach that captures this same 
material. EPA attempted to write these regulations in a way that does 
not change the underlying hearing protocol.
    The regulations currently reference the formal hearing procedures 
in 40 CFR 85.1807, which were originally drafted to apply to light-duty 
motor vehicles. After we adopted the hearing procedures in 40 CFR 
85.1807, EPA's Office of Administrative Law Judges finalized a set of 
regulations defining formal hearing procedures that were intended to 
apply broadly across the agency for appeals under every applicable 
statute. See 40 CFR part 22, ``Consolidated Rules of Practice Governing 
the Administrative Assessment of Civil Penalties and the Revocation/
Termination or Suspension of Permits.'' EPA is therefore revising the 
regulations in 40 CFR part 1068 to simply refer to these formal hearing 
procedures in 40 CFR part 22.
(2) Additional Changes to General Compliance Provisions
    EPA is also making numerous changes across 40 CFR part 1068 to 
correct errors, to add clarification, and to make adjustments based on 
lessons learned from implementing these regulatory provisions. This 
includes the following changes:
     Sec.  1068.1: Clarify applicability of part 1068 with 
respect to legacy parts (such as 40 CFR parts 89 through 94).
     Sec.  1068.20: Clarify that EPA's inspection activities do 
not depend on having a warrant or a court order. As noted in the 
standard-setting parts, EPA may deny certification or suspend or revoke 
certificates if a manufacturer denies EPA entry for an attempted 
inspection or other entry.
     Sec.  1068.27: Clarify that EPA confirmatory testing may 
be performed before issuance of a certificate of conformity. We are 
also making an addition to state that we may require manufacturers to 
give us any special components that are needed for EPA testing.
     Sec.  1068.30: Add definitions of ``affiliated 
companies,'' ``parent company,'' and ``subsidiaries'' to clarify how 
small-business provisions apply for a range of business relationships.
     Sec.  1068.30: Clarify that in the context of provisions 
that apply only for certificate holders, a manufacturer can be 
considered a certificate holder based on the current or previous model 
year (to avoid problems from having a gap between model years).
     Sec.  1068.30: Spell out contact information for the 
``Designated Compliance Officer'' to clarify how manufacturers should 
submit information to the agency. This includes email addresses for the 
various sectors.
     Sec.  1068.32: Add discussion to establish the meaning of 
various terms and phrases for EPA regulations; for example, we 
distinguish between standards, requirements, allowances, prohibitions, 
and provisions. EPA is also clarifying terminology with respect to 
singular/plural, inclusive lists, notes and examples in the regulatory 
text, and references to ``general'' or ``typical'' circumstances. EPA 
also describes some of the approach to determining when ``unusual 
circumstances'' apply.
     Sec.  1068.45: Allow manufacturers to use coded dates on 
engine labels; allow EPA to require the manufacturer to share 
information to read the coded information.
     Sec.  1068.45: Clarify that engine labels are information 
submissions to EPA.
     Sec. Sec.  1068.101 and 1068.125: Update penalty amounts 
to reflect changes to 40 CFR part 19 (81 FR 43094, July 1, 2016).
     Sec.  1068.101: Revise the penalty associated with the 
tampering prohibition to be an engine-based penalty, as opposed to 
assessing penalties per day of engine operation. This correction aligns 
with Clean Air Act section 205.
     Sec.  1068.103: Clarify the process for reinstating 
certificates after suspending, revoking, or voiding.
     Sec.  1068.103: Clarify that the prohibition against 
``offering for sale'' uncertified engines applies only for engines 
already produced. It is not a violation to invite customers to buy 
engines as part of an effort to establish the economic viability of 
producing engines, as would be expected for market research.
     Sec.  1068.105: Require documentation related to ``normal 
inventory'' for stockpiling provision. EPA is also clarifying that 
there is no specific deadline associated with producing ``normal-
inventory'' engines under this section, but emphasizing that vehicle/
equipment manufacturers may not delay engine installation beyond their 
normal production schedules. EPA is also clarifying that the allowance 
related to building vehicles/equipment in the early part of a model 
year, before the start of a new calendar year corresponding to new 
emission standards, applies only in cases where vehicle/equipment 
assembly is complete before the start of the new calendar year. This is 
intended to prevent manufacturers from circumventing new standards by 
initiating production of large numbers of vehicles/equipment for 
eventual completion after new standards have started to apply.
     Sec.  1068.210: Remove the requirement for companies 
getting approval for a testing exemption to send us written 
confirmation that they meet the terms and conditions of the exemption. 
We do not believe this submission is necessary for implementing the 
testing exemption.
     Sec.  1068.220: Add a description of how we might approve 
engine operation under the display exemption. This is intended to more 
carefully address circumstances in which engine operation is part of 
the display function in question. We will want to consider a wide range 
of factors in considering such a request; for example, we may be more 
inclined to approve a request for a display exemption if the extent of 
operation is very limited, or if the engine/equipment has emission 
rates that are comparable to what would apply absent the exemption. EPA 
is also removing the specific prohibition against generating revenue 
with exempted engines/equipment, since this has an unclear meaning and 
we can take any possible revenue generation into account in considering 
whether to approve the exemption on its merits.
     Sec.  1068.230: Add a provision allowing for engine 
operation under the export exemption only as needed to prepare it for 
export (this has already been in place in part 85, and in part 1068 for 
engines/equipment imported for eventual export).
     Sec.  1068.235: Clarify that the standard-setting part may 
set conditions on an exemption for nonroad competition engines/
equipment.
     Sec.  1068.240: Clarify that manufacturers may export 
engines as an alternative to being destroyed if the engine was replaced 
with an engine covered by the exemption provisions of Sec.  
1068.240(b).
     Sec.  1068.240: Describe the logistics for identifying the 
disposition of engines being replaced under the replacement engine 
exemption. In particular, manufacturers will need to resolve the 
disposition of each engine by the due date for the report under Sec.  
1068.240(c) to avoid counting them toward the production limit for

[[Page 73949]]

untracked replacement engines. We are delaying the due date for the 
report until September 30 following the production year to allow more 
time for manufacturers to make these determinations.
     Sec.  1068.240: Clarify the relationship between 
paragraphs (d) and (e).
     Sec.  1068.250: Simplify the deadline for requesting 
small-volume hardship.
     Sec.  1068.255: Clarify that hardship provisions for 
equipment manufacturers are not limited to small businesses, and that a 
hardship approval is generally limited to a single instance of 
producing exempt equipment for up to 12 months.
     Sec.  1068.260: State that manufacturers shipping engines 
without certain emission-related components need to identify the 
unshipped components either with a performance specification (where 
applicable) or with specific part numbers. We are also listing exhaust 
piping before and after aftertreatment devices as not being emission-
related components for purposes of shipping engines in a certified 
configuration.
     Sec. Sec.  1068.260 and 1068.262: Revise the text to 
clarify that provisions related to partially complete engines have 
limited applicability in the case of equipment subject to equipment-
based exhaust emission standards (such as recreational vehicles). These 
provisions are not intended to prevent the sale of partially complete 
equipment with respect to evaporative emission standards. We intend to 
address this in the future by changing the regulation in 40 CFR part 
1060 to address this more carefully.
     Sec.  1068.262: Revise text to align with the terminology 
and description adopted for similar circumstances related to shipment 
of incomplete heavy-duty vehicles under 40 CFR part 1037.
     Sec.  1068.301: Revise text to more broadly describe 
importers' responsibility to submit information and store records and 
explicitly allow electronic submission of EPA declaration forms and 
other importation documents.
     Sec.  1068.305: Remove the provision specifying that 
individuals may need to submit taxpayer identification numbers as part 
of a request for an exemption or exclusion for imported engines/
equipment. We do not believe this information is necessary for 
implementing the exemption and exclusion provisions.
     Sec.  1068.315: Allow for destroying engines/equipment 
instead of exporting them under the exemption for importing engines/
equipment for repairs or alterations.
     Sec.  1068.315: Remove the time constraints on approving 
extensions to a display exemption for imported engines/equipment. EPA 
will continue to expect the default time frame of one year to be 
appropriate, and extension of one to three years is sufficient for most 
cases; however, we are aware that there are occasional circumstances 
calling for a longer-term exemption. For example, an engine on display 
in a museum might appropriately be exempted indefinitely once its place 
in a standing exhibition is well established.
     Sec.  1068.315: Specify that engines under the ancient 
engine exemption must be substantially in the original configuration.
     Sec.  1068.360: Clarify the provisions related to model 
year for imported products by removing a circularity regarding ``new'' 
engines and ``new'' equipment.
     Sec.  1068.401: Add explicit statement that SEA testing is 
at manufacturer's expense. This is consistent with current practice and 
the rest of the regulatory text.
     Sec.  1068.401: Allow for requiring manufacturers other 
than the certificate holder to perform selective enforcement audits in 
cases where multiple manufacturers are cooperatively producing 
certified engines.
     Sec.  1068.401: State that SEA non-cooperation may lead to 
suspended or revoked certificate (like production-line testing).
     Sec.  1068.415: Set up new criteria for lower SEA testing 
rate based on engine power to allow for a reduced testing rate of one 
engine per day only for engines with maximum engine power above 560 kW, 
but keep the allowance to approve a lower testing rate; that may be 
needed, for example, if engine break-in (stabilization) and testing are 
performed on the same dynamometer. EPA believes it is more appropriate 
to base reduced testing rates on engine characteristics rather than 
sales volumes, as has been done in the past.
     Sec.  1068.415: Revise the service accumulation 
requirement to specify a maximum of eight days for stabilizing a test 
engine. This is necessary to address a situation where an engine 
operates only six hours per day to achieve stabilization after well 
over 50 hours. For such cases, we would expect manufacturers to be able 
to run engines much more than six hours per day. As with testing rates, 
manufacturers may ask for our approval to use a longer stabilization 
period if circumstances don't allow them to meet the specified service 
accumulation targets.
     Sec.  1068.501, and Appendix I: Clarify that ``emission-
related components'' include components whose failure would commonly 
increase emissions (not might increase), and whose primary purpose is 
to reduce emissions (not sole purpose); current regulations are not 
consistent.
     Sec.  1068.501: Add ``in-use testing'' to list of things 
to consider for investigating potential defects.
     Sec.  1068.505: Clarify that manufacturers subject to a 
mandatory recall must remedy vehicles with an identified nonconformity 
without regard to their age or mileage at the time of repair, 
consistent with provisions that already apply under 40 CFR part 85.
     Sec.  1068.505: Revise the requirement for submitting a 
remedial report from a 60-day maximum to a 45-day minimum (or 30-day 
minimum in the event of a hearing). This adjusted approach already 
applies to motor vehicles under 40 CFR part 85.
     Sec.  1068.515: Clarify an ambiguity to require that 
manufacturers identify the facility where repairs or inspections are 
performed, and allow manufacturers to keep records of those facilities 
rather than including the information on the recall label.
     Sec.  1068.530: Specify that recall records must be kept 
for five years, rather than three years. This is consistent with 
longstanding recall policy for motor vehicles and motor vehicle engines 
under 40 CFR part 85.
    In addition, EPA received a comment from Navy on behalf of the 
Defense Department requesting that we add a provision to allow for an 
automatic national security exemption in cases where a federal defense 
agency owns an engine that would need sulfur-sensitive technology to 
comply with emission standards if it is intended to be used in areas 
outside the United States where ultra-low sulfur fuel is unavailable. 
We are adopting this change as part of the final rule. This will reduce 
the agencies' burden to process what has become a routine process for 
requesting and approving these exemptions. We are also taking the 
opportunity to include marine diesel engines in this same section, 
rather than treating them separately under 40 CFR 1042.635.
    We proposed to revise Sec.  1068.201 to describe how someone may 
sell an engine under a different exemption than was originally intended 
or used as a result of unforeseen circumstances. However, we have 
decided to postpone those regulatory amendments to a future rule. This 
will give us opportunity to more thoroughly explore all relevant 
factors, such as:
     Statutory authority and requirements.

[[Page 73950]]

     Business interests for managing distribution and 
inventories of exempted engines.
     Environmental impacts.

E. Amendments to Light-Duty Greenhouse Gas Program Requirements

    EPA is making minor changes to correct errors and clarify 
regulations in 40 CFR part 86, subpart S, and 40 CFR part 600 relating 
to EPA's light-duty fuel economy and greenhouse gas emission standards. 
This includes the following changes:
     Sec.  86.1818-12: Correct a reference in paragraph (c)(4) 
and clarify that CO2-equivalent debits for N2O 
and CH4 are calculated in Megagrams and rounded to the 
nearest whole Megagram.
     Sec.  86.1838-01: Correct references in paragraph 
(d)(3)(iii).
     Sec.  86.1866-12: Correct a reference in paragraph (b).
     Sec.  86.1868-12: Clarify language in the introductory 
paragraph explaining the model years of applicability of different 
provisions for air conditioning efficiency credits. In paragraph (e)(5) 
clarify that the engine-off specification of 2 minutes is intended to 
be cumulative time. In paragraphs (f)(1), (g)(1), and (g)(3), clarify 
language by pointing to the definitions in Sec.  86.1803-01.
     Sec.  86.1869-12: Make corrections to the language for 
readability in paragraph (b)(2). In paragraph (b)(4)(ii) delete the 
phrase ``backup/reverse lights'' because these lights were not intended 
to be part of the stated eligibility criteria for high-efficiency 
lighting credits. Correct references in paragraph (f).
     Sec.  86.1870-12: Add language that clarifies that a 
manufacturer that meets the minimum production volume thresholds with a 
combination of mild and strong hybrid electric pickup trucks is 
eligible for credits.
     Sec.  86.1871-12: Clarify that credits from model years 
2010-2015 are not limited to a life of 5 model years. A recent rule 
extended the life of 2010-2015 credits to model year 2021; thus, 
language referring to a 5-year life for emission credits generated in 
these model years is being removed or revised.
     Sec.  600.113-12: Correct language in paragraph (m)(1), 
which relates to vehicles operating on LPG, that erroneously refers to 
methanol and methanol-fueled.
     Sec.  600.113-12: Correct references in paragraph (n) and 
add a new paragraph (m) that reinstates language mistakenly dropped by 
a previous regulation.
     Sec.  600.116-12: Correct description of physical quantity 
to refer to ``energy'' rather than ``current,'' and correct various 
paragraph references.
     Sec.  600.208-12: Correct a reference in paragraph 
(a)(2)(iii).
     Sec.  600.210-12: Correct a reference and text in 
paragraph (c)(2)(iv)(C).
     Sec.  600.311-12: Revise fuel economy label instructions 
to (1) identify label ratings for model year 2017 and earlier standards 
certified early to the Tier 3 standards, (2) identify label ratings for 
Interim Tier 3 vehicles certified to interim bins for model years 2018 
through 2024, and (3) clarify that the specified California emission 
standards determine label ratings only if vehicles are not subject to 
any EPA standards. All these changes are consistent with current 
implementation through guidance.
     Sec.  600.510-12: Correct a reference in the equation in 
paragraph (c)(1)(ii) to apply the air conditioning, off-cycle, and 
pickup truck credits to the appropriate fleet average MPG value. Revise 
the regulation to accelerate the transition to fuel economy 
calculations using utility factors for natural gas vehicles, consistent 
with the methodology that applies for plug-in hybrid vehicles. This 
amendment was adopted by Congress as part of Fixing America's Surface 
Transportation Act, H.R. 22, 114th Cong. Sec.  24341 (2015).

F. Amendments to Highway and Nonroad Test Procedures and Certification 
Requirements

(1) Testing With Aftertreatment Devices Involving Infrequent 
Regeneration
    Manufacturers generally rely on selective catalytic reaction and 
diesel particulate filters to meet EPA's emission standards for highway 
and nonroad compression-ignition engines. These emission control 
devices typically involve infrequent regeneration, which can have a 
significant effect on emission rates. EPA has addressed that for each 
engine type by provisions for infrequent regeneration factors; this is 
a calculation methodology that allows manufacturers to incorporate the 
effect of infrequent regeneration into reported emission values whether 
or not that regeneration occurs during an emission test. EPA adopted 
separate provisions for highway, locomotive, marine, and land-based 
nonroad compression-ignition engines. As proposed, EPA is harmonizing 
the common elements of these procedures in 40 CFR part 1065, and adding 
clarifying specifications in each of the standard-setting parts for 
sector-specific provisions. Commenters generally supported this 
revision. See Section II for a discussion of how IRAFs will apply for 
GHGs in Phase 2.
(2) Mapping for Constant-Speed Engines Under 40 CFR Part 1065
    EPA is revising 40 CFR 1065.510 as it applies to the two-point 
mapping method for certain constant-speed engines. The regulations 
previously cited a performance parameter in ISO 8528-5 that does not 
apply for the design of these engines.
    It is common practice for engines that produce electric power to 
use an isochronous governor for stand-alone generator sets. In some 
parallel operations of multiple generator sets, droop is added as a 
method for load sharing. The amount of droop can be tuned by the 
generator set manufacturer or the site system integrator. Such engines 
are commonly tested on an engine dynamometer with the isochronous 
governor.
    Mapping with just two points works well for the case of 0 percent 
droop (i.e., isochronous governor). For this case, a persistent speed 
error is forced on the engine governor on the second point and this 
will cause the governor to wind up to its maximum command. The second 
point is effectively operating on the torque curve instead of the 
isochronous governor. So, the second point captures the full fueling 
torque (plus a small amount due to any rising torque curve). This 
measured torque is used as the maximum test torque for computing the 
emission test points. Since there is no designed-in droop, some target 
amount of speed error is needed for the second point. The regulation at 
40 CFR 1065.510(d)(5)(iii) has a default target speed on the second 
point of 97.5 percent of the no-load speed measured on the first point. 
This results in a persistent speed error of 2.5 percent of the no-load 
speed. For an 1800 rpm no-load speed, this gives a target speed of 1755 
rpm and a 45 rpm speed error on an isochronous governor. If the engine 
has a torque rise of 20 percent from 1800 to 1200 rpm (0.0333 percent 
torque rise per rpm), this 45 rpm error will cause a 1.5 percent-of-
point error in the determination of the intended maximum test torque. 
This error is larger than desired for this type of testing. 
Fortunately, engines and test cells have sufficient speed resolution to 
select a lower speed error, which reduces this error in maximum test 
torque. In practice, testing with a speed error at or below 0.5 percent 
is more than adequate to cause the isochronous governor to wind up to 
maximum fueling. Using a target speed of 99.5 percent on the second 
point gives a target speed of 1791 rpm for an 1800

[[Page 73951]]

rpm no-load speed and reduces the error on the maximum test torque to a 
reasonable 0.3 percent of point for the 20 percent torque rise case 
described above.
    For governors with droop, if we attempt the two-point method, we 
would have to calculate a target speed for the second point based on a 
designed amount of droop. Unfortunately, the actual governor may not 
have the same amount of droop as the design droop, which may cause 
error in the measured torque versus the maximum test torque associated 
with a complete torque map. Also, the design droop may be based on a 
torque value that is different from the intended maximum test torque. 
Thus, the two-point method is not sufficient to yield a maximum test 
torque equivalent to the value obtained using a multi-point map. Also 
the allowed speed error on the second point is 20 percent of the speed 
droop, which allows an unacceptably large error in the maximum test 
torque.
    Thus, for the reasons listed, we are limiting the two-point mapping 
method to any isochronous governed engines, not just engines used to 
generate electric power.
(3) Calculating Maximum and Intermediate Test Speeds Under 40 CFR Part 
1065
    EPA is improving the method for calculating maximum and 
intermediate test speeds by applying a more robust calculation method. 
The new calculation method is consistent with the methodology used to 
determine maximum test torque, which we revised in the light-duty Tier 
3 rulemaking. Under the previous regulations, the result was a measured 
maximum test torque at one of the map points. The new calculation 
method involves interpolation to determine the measured maximum test 
torque, yielding a more representative maximum value for test torque.
(4) Excluding Ethane From Measure Emissions for Gaseous-Fueled 
Compression-Ignition Engines
    EPA proposed to allow manufacturers to use NMOG measurements to 
demonstrate compliance with NMHC standards. This was primarily intended 
to address concerns about ethane emissions from natural gas engines 
inappropriately impacting compliance determinations when the engines 
are tested using fuels that have relatively high ethane content. 
Commenters shared that the proposed approach would not accomplish the 
intended purpose. Some commenters also emphasized that ethane is a 
hydrocarbon and an organic compound that has a low ozone reactivity 
(i.e., ethane emissions do little to contribute to ozone), and that 
ethane emissions are hard to remove with a catalytic converter. We are 
finalizing a more direct approach in which engines designed to operate 
on gaseous fuels are subject to hydrocarbon standards in the form of 
nonmethane-nonethane hydrocarbons. This approach applies for all the 
different sectors of mobile compression-ignition engines--heavy-duty 
highway, land-based nonroad, marine, and locomotive. Excluding ethane 
from hydrocarbon measurements requires additional test specifications 
as noted in the following section.
    We are adopting an alternative provision that involves reduced test 
burden by selecting a low-ethane test fuel. In particular, EPA or 
manufacturers performing measurements with a test fuel containing 1.0 
percent ethane or less may measure an engine's NMHC emissions and 
multiple this value by 0.95 to determine its nonmethane-nonethane 
hydrocarbon emissions, without separately measuring ethane in the 
exhaust.
(5) Additional Test Procedure Amendments
    EPA is adopting the following additional changes to test procedures 
in 40 CFR part 1065 and part 1066:
     Sec.  1065.202: Revised to prevent specific data 
collection errors known as aliasing. More specifically, the revision 
will ensure that aliasing of data collection signal due to filtering or 
sampling rate does not happen. We believe that all labs are currently 
preventing aliasing, but this should be described in the regulations.
     Sec.  1065.266: This new section allows the use of an FTIR 
for determination of NMHC or NMNEHC from engines fueled solely on LPG 
or natural gas. The measurement of methane and ethane is also allowed 
for engine fueled with LPG or natural gas, in combination with a liquid 
fuel, for determination of NMHC or NMNEHC when subtracting methane and/
or ethane from a FID-derived THC value. The intent of the NMNEHC 
provision is to allow the subtraction of ethane from THC in cases where 
the certification fuel available to the testing lab is high in ethane 
content.
     Sec.  1065.275: ASTM D6348 was added as a reference method 
for interpretation of spectra for N2O determination by FTIR.
     Sec.  1065.340 and 1065.341: These sections contain a 
collection of editorial corrections pertaining to CVSs intended to 
improve the understanding of the calibration and verification 
procedures.
     Sec.  1065.366: This new section provides interference 
verification procedures for FTIR hydrocarbon analyzers allowed under 
Sec.  1065.266.
     Sec.  1065.640 and 1065.642: These sections contain a 
collection of editorial corrections pertaining to CVSs intended to 
improve the understanding of the calculation procedures.
     Sec.  1065.655: Revised to separate out carbon mass 
fraction of fuel and fuel composition determinations into separate 
sections to improve readability. This section was also revised to 
include any fluids injected into the exhaust in the determination of 
the carbon mass fraction of fuel. This ensures that all fluids in the 
exhaust are accounted for. Provisions were also added to address how to 
determine properties when multiple fuel streams (e.g., gaseous and 
liquid) are used.
     Sec.  1065.1001: Added a definition for diesel exhaust 
fluid.
     Sec.  1066.110: Revised to allow a shortening of the 
tailpipe for connection to the CVS and to simultaneously conduct PM 
background sampling with propane recovery checks. This section was also 
revised to change the limit on filter face velocity from 100 cm/s to 
140 cm/s. The purpose of this is to increase filter mass loading. This 
change is based on results obtained from the CRC E-99 Phase 1 test 
program, which showed that there was no loss of semi-volatile PM at 
this higher filter face velocity. Higher filter mass loadings will help 
to reduce uncertainty and lessen the impact of background variability 
on the final PM emission value.
     Sec.  1066.210: Revise the dynamometer force equation to 
incorporate grade, consistent with the coastdown procedures we are 
adopting for heavy-duty vehicles. For operation at a level grade, the 
additional parameters cancel out of the calculation.
     Sec.  1066.605: Adding an equation to the regulations to 
spell out how to calculate emission rates in grams per mile. This 
calculation is generally assumed, but we want to include the equation 
to remove any uncertainty about calculating emission rates from mass 
emission measurements and driving distance. We also added equations to 
vary sample extraction ratio instead of changing flow over the filter 
when performing single filter per test sampling for PM measurement.
     Sec.  1066.815: Create an exception to the maximum value 
for overall residence time for PM sampling methods that involve 
collecting samples for combined bags over a duty cycle. This is needed 
to accommodate the

[[Page 73952]]

reduced sample flow rates associated with these procedures. We also 
added provisions to vary sample extraction ratio instead of changing 
flow over the filter when performing single filter per test sampling 
for PM measurement.

G. Amendments Related to Locomotives in 40 CFR Part 1033

    EPA's emission standards and certification requirements for 
locomotives and locomotive engines under the Clean Air Act are 
identified in 40 CFR part 1033.
    EPA is revising the engine mapping provisions in 40 CFR part 1033 
for locomotive testing to denote that manufacturers do not have to meet 
the cycle limit values in 40 CFR 1065.514 when testing complete 
locomotives. Also, for engine testing with a dynamometer, while the 
validation criteria of CFR 1065.514 apply, EPA is allowing 
manufacturers the option to check validation using manufacturer-
declared values for maximum torque, power, and speed. This option will 
allow them to omit engine mapping under 40 CFR 1065.510, which is 
already not required. These provisions reduce test burden and cost for 
the manufacturer, while preserving the integrity of the certification 
requirements.
    EPA is also adopting text that describes the alternate ramped-model 
cycle provisions in 40 CFR part 1033 as some of the notch setting and 
durations are inconsistent with the description of the duty cycle in 
Table 1 of 40 CFR 1033.520. EPA has determined that the table is 
correct as published and the error lies in the text describing how to 
carry out the ramped-modal test.
    We are also clarifying that locomotives operating on a combination 
of diesel fuel and gaseous fuel are subject to NMHC standards (or 
NMNEHC standards), which is the same as if the locomotives operated 
only on gaseous fuel. With respect to in-use fuels, we are adopting a 
clarification in 40 CFR 1033.815 regarding allowable fuels for certain 
Tier 4 and later locomotives. Specifically, we note that locomotives 
certified on ultra-low sulfur diesel fuel, but that do not include 
sulfur-sensitive emission controls, may use low sulfur diesel fuel 
instead of ultra-low sulfur diesel fuel, consistent with good 
engineering judgment. For example, an obvious case where this would be 
appropriate (but not the only possible case), is if a railroad had 
emission data showing the locomotive still met the applicable 
standards/FELs while operating on the higher sulfur fuel.
    We also requested comment on whether EPA should consider notch-
specific engine/alternator efficiencies to be confidential business 
information. However commenters did not support making this change in 
the regulations.
    We requested comment on extending the provisions of 40 CFR 
1033.101(i) involving a less stringent CO standard in combination with 
a more stringent PM standard to Tier 4 locomotives. The existing 
provisions were developed to provide a compliance path for natural gas 
locomotives that reflected both the technological capabilities of 
natural gas locomotives and the relative environmental significance of 
CO and PM emissions. This provision was not applied to Tier 4 
locomotives, because the applicable Tier 4 p.m. standard is already 
very low (0.03 g/hp-hr). Engine manufacturers commented in favor of 
adopting alternate standards for Tier 3 and Tier 4 locomotives. We are 
extending the alternate 10.0 g/bhp-hr CO standard to Tier 3 and Tier 4 
locomotives; manufacturers would qualify for the less stringent CO 
standard by meeting a PM standard of 0.01 g/bhp-hr.
    EPA is making numerous additional changes across 40 CFR part 1033 
to correct errors, to add clarification, and to make adjustments based 
on lessons learned from implementing these regulatory provisions. This 
includes the following changes:
     Sec. Sec.  1033.30, 1033.730, and 1033.925: Consolidate 
information-collection provisions into a single section.
     Sec.  1033.101: Allow manufacturers to certify Tier 4 and 
later locomotives using Low Sulfur Diesel fuel instead of Ultra-Low 
Sulfur Diesel fuel. Manufacturers may wish to do this to show that 
their locomotives do not include sulfur-sensitive technology.
     Sec.  1033.120: Reduce extended-warranty requirements to 
warranties that are actually provided to customers, rather than to any 
published warranties that are offered. The principle is that the 
emission-related warranty should not be less effective for emission-
related items than for items that are not emission-related.
     Sec.  1033.150: Correct the URL associated with price 
index information for calculating current costs.
     Sec.  1033.201: Clarify that manufacturers may amend their 
application for certification after the end of the model year in 
certain circumstances, but they may not produce locomotives for a given 
model year after December 31 of the named year.
     Sec.  1033.201: Establish that manufacturers may deliver 
to EPA for testing a locomotive/engine that is identical to the test 
locomotive/engine used for certification. This may be necessary if the 
test locomotive/engine has accumulated too many hours, or if it is 
unavailable for any reason.
     Sec.  1033.235: Add an explicit allowance for carryover 
engine families to include the same kind of within-family running 
changes that are currently allowed over the course of a model year. The 
original text may have been understood to require that such running 
changes be made separate from certifying the engine family for the new 
model year.
     Sec. Sec.  1033.235, 1033.245, and 1033.601: Describe how 
to demonstrate compliance with dual-fuel and flexible-fuel locomotives. 
This generally involves testing with each separate fuel, or with a 
worst-case fuel blend.
     Sec.  1033.245: Add instructions for calculating 
deterioration factors for sawtooth deterioration patterns, such as 
might be expected for periodic maintenance, such as cleaning or 
replacing diesel particulate filters.
     Sec.  1033.250: Remove references to routine and standard 
tests, and remove the shorter recordkeeping requirement for routine 
data (or data from routine tests). All test records must be kept for 
eight years. With electronic recording of test data, there should be no 
advantage to keeping the shorter recordkeeping requirement for a subset 
of test data. EPA also notes that the eight-year period restarts with 
certification for a new model year if the manufacturer uses carryover 
data.
     Sec.  1033.255: Clarify that rendering information false 
or incomplete after submitting it is the same as submitting false or 
incomplete information. For example, if there is a change to any 
corporate information or engine parameters described in the 
manufacturer's application for certification, the manufacturer must 
amend the application to include the new information.
     Sec.  1033.255: Clarify that voiding certificates for a 
recordkeeping or reporting violation would be limited to certificates 
that relate to the particular recordkeeping or reporting failure.
     Sec.  1033.501: Clarify how testing requirements apply 
differently for locomotive engines and for complete locomotives.
     Sec.  1033.501: Add paragraph (a)(4) to remove 
proportionality verification for discrete-mode tests if a single batch 
fuel measurement is used to determine raw exhaust flow rate. This 
verification involves statistical assessment that is not valid for the 
single data point. Requiring manufacturers instead to

[[Page 73953]]

simply ensure constant sample flow should adequately address the 
concern,
     Sec.  1033.515: Provide the option to carry out smoke 
testing separate from criteria pollutant measurement with a reduced 
time-in-notch of 3 minutes. This change reestablishes a provision that 
was previously allowed in 40 CFR 92.124(f).
     Sec. Sec.  1033.515 and 1033.520: Update terminology by 
referring to ``test intervals'' instead of ``phases.'' This allows us 
to be consistent with terminology used in 40 CFR part 1065.
     Sec.  1033.520: Correct the example given to describe the 
testing transition after the second test interval.
     Sec. Sec.  1033.701 and 1033.730: Describe the process for 
retiring emission credits. This may be referred to as donating credits 
to the environment.
     Sec.  1033.710: Clarify that it is not permissible to show 
a proper balance of credits for a given model by using emission credits 
from a future model year.
     Sec.  1033.730: Clarify terminology for ABT reports.
     Sec.  1033.815: Add consideration of periodic locomotive 
inspections in 184-day intervals.
     Sec.  1033.901: Update the contact information for the 
Designated Compliance Officer.
     Sec.  1033.915: Migrate provisions related to confidential 
information to 40 CFR part 1068.
    We proposed to disallow amending certified configurations after the 
end of the model year. However, manufacturers shared in their comments 
that this would change the field-fix policy that has long since allowed 
for making such changes. We have retracted the proposed change and 
replaced it with a new paragraph that describes how manufacturers may 
amend the application for certification during and after the model 
year, consistent with the current policy regarding field fixes.

H. Amendments Related to Nonroad Diesel Engines in 40 CFR Part 1039

    EPA is adopting two changes to 40 CFR 1039.5 to clarify the scope 
and applicability of standards under 40 CFR part 1039. First, EPA is 
stating that engines using the provisions of 40 CFR 1033.625 for non-
locomotive-specific engines remain subject to certification 
requirements as nonroad diesel engines under 40 CFR part 1039. Such 
engines will need to be certified as both locomotive engines and as 
nonroad diesel engines. Second, EPA is revising the statement about how 
manufacturers may certify under 40 CFR part 1051 for engines installed 
in recreational vehicles (such as all-terrain vehicles or snowmobiles). 
EPA is removing text that might be interpreted to mean that there are 
circumstances in which certification under neither part is required. 
The proper understanding of EPA's policy in that regard is that 
certification under one part is a necessary condition for being 
exempted from the other part.
    In 2008, EPA adopted a requirement in 40 CFR part 1042 for 
manufacturers to design marine diesel engines using selective catalytic 
reduction with basic diagnostic functions to ensure that these systems 
were working as intended (73 FR 37096, June 30, 2008). EPA is applying 
those same diagnostic control requirements to nonroad diesel engines 
regulated under 40 CFR part 1039. This addresses the same fundamental 
concern that engines will not be controlling emissions consistent with 
the certified configuration if the engine is lacking the appropriate 
quantity and quality of reductant. While some lead time is needed to 
make the necessary modifications, we believe it will be straightforward 
to apply the same designs from marine diesel engines to land-based 
nonroad diesel engines. EPA is accordingly requiring that manufacturers 
meet the new diagnostic specifications starting with model year 2018. 
These diagnostic controls will not affect the current policy related to 
adjustable parameters and inducements related to selective catalytic 
reduction.
    EPA is making numerous changes across 40 CFR part 1039 to correct 
errors, to add clarification, and to make adjustments based on lessons 
learned from implementing these regulatory provisions. This includes 
the following changes:
     Sec.  1039.2: Add a clarifying note to say that something 
other than a conventional ``manufacturer'' may need to certify engines 
that become new after being placed into service (such as engines 
converted from highway or stationary use). This is intended to address 
a possible assumption that only conventional manufacturers can certify 
engines.
     Sec. Sec.  1039.30, 1039.730, and 1039.825: Consolidate 
information-collection provisions into a single section.
     Sec.  1039.107: Remove the reference to deterioration 
factors for evaporative emissions, since there are no deterioration 
factors for demonstrating compliance with evaporative emission 
standards.
     Sec.  1039.104(g): Correct the specified FEL cap for an 
example scenario illustrating how alternate FEL caps work.
     Sec.  1039.120: Reduce extended-warranty requirements to 
warranties that are actually provided to the consumer, rather than to 
any published warranties that are offered. The principle is that the 
emission-related warranty should not be less effective for emission-
related items than for items that are not emission-related.
     Sec.  1039.125: Add crankcase vent filters to the list of 
maintenance items.
     Sec.  1039.125: Allow for special maintenance procedures 
that address low-use engines. For example, owners of recreational 
marine vessels may need to perform engine maintenance after a smaller 
number of hours than would otherwise apply based on the limited engine 
operation over time.
     Sec.  1039.125: Establish a minimum maintenance interval 
of 1500 hours for DEF filters. This reflects the technical capabilities 
for filter durability and the expected maintenance in the field.
     Sec.  1039.125: Add fuel-water separator cartridges as an 
example of a maintenance item that is not emission-related.
     Sec.  1039.125: Add a clearer cross reference to clarify 
that particulate traps are subject to the same maintenance intervals 
that apply for catalysts, consistent with the originally adopted 
maintenance provisions for the Tier 4 standards.
     Sec.  1039.135: Allow for including optional label content 
only if this does not cause the manufacturer to omit other information 
based on limited availability of space on the label, and identify 
counterfeit protection as an additional item that manufacturers may 
include on the label. We modified the proposed amendment in response to 
comments to allow for including optional labeling content as long as 
the additional content doesn't cause the space limitations that prevent 
inclusion of other optional information.
     Sec.  1039.201: Clarify that manufacturers may amend their 
application for certification after the end of the model year in 
certain circumstances, but they may not produce engines for a given 
model year after December 31 of the named year.
     Sec.  1039.201: Establish that manufacturers may deliver 
to EPA for testing an engine that is identical to the test engine used 
for certification. This may be necessary if the test engine has 
accumulated too many hours, or if it is unavailable for any reason.
     Sec.  1039.205: Replace the requirement to submit data 
from invalid tests with a requirement to simply notify EPA in the 
application for certification if test was invalidated.
     Sec.  1039.205: Add a requirement for manufacturers to 
include in their application for certification a description of their 
practice for

[[Page 73954]]

importing engines, if applicable. Note that where a manufacturers' 
engines are imported through a wide variety of means, EPA will not 
require this description to be comprehensive. In such cases, a short 
description of the predominant practices will generally be sufficient. 
As noted in comments from the Truck and Engine Manufacturers 
Association, engine manufacturers whose primary method of importing 
engines is by selling them to foreign-based equipment manufacturers for 
eventual importation into the United States may simply state that these 
products may be imported at the discretion of the equipment 
manufacturer. We are also adding a requirement for manufacturers of 
engines below 560 kW to name a test lab in the United States for the 
possibility of us requiring tests under a selective enforcement audit. 
We have adopted these same requirements in many of our other nonroad 
programs.
     Sec.  1039.235: Add an explicit allowance for carryover 
engine families to include the same kind of within-family running 
changes that are currently allowed over the course of a model year. The 
original text may have been understood to require that such running 
changes be made separate from certifying the engine family for the new 
model year.
     Sec. Sec.  1039.235, 1039.240, and 1039.601: Describe how 
to demonstrate compliance with dual-fuel and flexible-fuel engines. 
This generally involves testing with each separate fuel, or with a 
worst-case fuel blend.
     Sec.  1039.240: Add instructions for calculating 
deterioration factors for sawtooth deterioration patterns, such as 
might be expected for periodic maintenance, such as cleaning or 
replacing diesel particulate filters.
     Sec.  1039.240: Remove the instruction related to 
calculating NMHC emissions from measured THC results, since this is 
addressed in 40 CFR part 1065.
     Sec.  1039.250: Remove references to routine and standard 
tests, and remove the shorter recordkeeping requirement for routine 
data (or data from routine tests). All test records must be kept for 
eight years. With electronic recording of test data, there should be no 
advantage to keeping the shorter recordkeeping requirement for a subset 
of test data. EPA also notes that the eight-year period restarts with 
certification for a new model year if the manufacturer uses carryover 
data.
     Sec.  1039.255: Clarify that rendering information false 
or incomplete after submitting it is the same as submitting false or 
incomplete information. For example, if there is a change to any 
corporate information or engine parameters described in the 
manufacturer's application for certification, the manufacturer must 
amend the application to include the new information.
     Sec.  1039.255: Clarify that voiding certificates for a 
recordkeeping or reporting violation will be limited to certificates 
that relate to the particular recordkeeping or reporting failure.
     Sec.  1039.505: Correct the reference to the ISO C1 duty 
cycle for engines below 19 kW.
     Sec.  1039.515: Correct the citation to 40 CFR 86.1370.
     Sec. Sec.  1039.605 and 1039.610: Revise the reporting 
requirement to require detailed information about the previous year, 
rather than requiring a detailed projection for the year ahead. The 
information required in advance will be limited to a notification of 
plans to use the provisions of these sections.
     Sec.  1039.640: Migrate engine branding to Sec.  1068.45.
     Sec.  1039.701 1039.730: Describe the process for retiring 
emission credits. This may be referred to as donating credits to the 
environment.
     Sec.  1039.705: Change terminology for counting engines 
from ``point of first retail sale'' to ``U.S.-direction production 
volume.'' This conforms to the usual approach for calculating emission 
credits for nonroad engines.
     Sec.  1039.710: Clarify that it is not permissible to show 
a proper balance of credits for a given model by using emission credits 
from a future model year.
     Sec.  1039.730: Clarify terminology for ABT reports.
     Sec.  1039.740: Clarify that the averaging-set provisions 
apply for credits generated by Tier 4 engines, not for credits 
generated from engines subject to earlier standards that are used with 
Tier 4 engines.
     Sec.  1039.801: Update the contact information for the 
Designated Compliance Officer.
     Sec.  1039.801: Revise the definition of ``model year'' to 
clarify that the calendar year relates to the time that engines are 
produced under a certificate of conformity.
     Sec.  1039.815: Migrate provisions related to confidential 
information to 40 CFR part 1068.
    We proposed to disallow amending certified configurations after the 
end of the model year. However, manufacturers shared in their comments 
that this would change the field-fix policy that has long since allowed 
for making such changes. We have retracted the proposed change and 
replaced it with a new paragraph that describes how manufacturers may 
amend the application for certification during and after the model 
year, consistent with the current policy regarding field fixes.
    We requested comment on removing regulatory provisions for 
Independent Commercial Importers from 40 CFR part 1039. These 
provisions, copied from highway regulations many years ago, generally 
allow for small businesses to modify small numbers of uncertified 
products to be in a certified configuration using alternative 
demonstration procedures, but they have not been used for nonroad 
engines for at least the last 15 years. We consider these to be 
obsolete. Commenters supported removal of these provisions, so we are 
including this change in the final rule.

I. Amendments Related to Marine Diesel Engines in 40 CFR Parts 1042 and 
1043

    EPA's emission standards and certification requirements for marine 
diesel engines under the Clean Air Act are identified in 40 CFR part 
1042.
(1) Continuous NOX Monitoring and On-Off Controls
    Manufacturers may produce certain marine diesel engines with on-off 
features that disable NOX controls when the ship is 
operating outside of a designated Emission Control Area (ECA) as long 
as certain conditions are met (Sec.  1042.115(g)). This provision, 
which applies to Category 3 engines meeting EPA Tier 3 standards, is 
intended to address the special operating conditions posed by an ECA 
and allows a ship that operates in and out of designated ECAs to 
downgrade engine NOX emission controls while the ship is 
operating outside of a designated ECA. This provision also applies for 
Tier 4 NOX standards for those Category 1 and Category 2 
auxiliary engines on Category 3 vessels covered by Sec.  1042.650(d); 
this provision does not apply to any other auxiliary engines or to any 
non-Category 3 propulsion engines. Engines with allowable on-off 
controls must be certified to meet the previous tier of NOX 
standards when the advanced NOX control strategies are 
disabled.
    Engines with on-off NOX controls are required to be 
equipped to continuously monitor NOX concentrations in the 
exhaust (Sec.  1042.110(d)). EPA has been asked to clarify what 
``continuous'' means in the context of this requirement. Because the 
purpose of this requirement is to show that the engine complies with 
the NOX emission limits on a continuous basis, continuous 
monitoring must be frequent enough to demonstrate that the 
NOX controls are

[[Page 73955]]

on and are properly functioning from the time the ship enters the ECA 
until it leaves, which, depending on the ECA and the ship's itinerary, 
could be a matter of hours or days. Since many manufacturers equip 
their emission control systems with NOX sensors to monitor 
and log the performance of the combined engine and emission control 
system, we are clarifying that continuous monitoring means measuring 
NOX emissions at least every 60 seconds. EPA is also 
specifying that a manufacturer may request approval of an alternative 
measurement period if that is necessary for sufficiently accurate 
measurements. With regard to the functioning of continuous 
NOX monitoring, the continuous emission measurement device 
must be included as part of the engine system for EPA certification. 
Continuous NOX monitoring must be engaged before the ship 
enters an ECA and continue until after it exits the ECA. Verification 
of operation of the system will be included in required periodic vessel 
surveys and certification that cover nearly all commercial U.S. 
vessels. Enforcement is expected to be performed on a periodic basis by 
appropriate authorities when a ship is in port.
    It should be noted that the above provisions with respect to on-off 
controls and continuous emission monitoring do not apply for the 40 CFR 
part 1042 PM standards. Engines certified to standards under 40 CFR 
part 1042 must meet the PM limits at all times, except when the 
operator has applied for and received permission to disable Tier 4 PM 
controls while operating outside the United States pursuant to any of 
the provisions of 40 CFR 1042.650(a) through (c).
(2) Category 1 and Category 2 Auxiliary Engines on Category 3 Vessels
    The regulation at 40 CFR 1042.650(d) exempts auxiliary Category 1 
and Category 2 engines installed on U.S.-flag Category 3 vessels from 
the part 1042 standards if those auxiliary engines meet certain 
conditions. This provision is intended to facilitate compliance with 
MARPOL Annex VI by certain qualified Category 3 vessels engaged in 
international trade and to simplify compliance demonstrations while 
those vessels are operating in foreign ports and foreign waters. EPA is 
adopting two revisions to make clear that the engines on the Category 3 
vessel must remain in compliance with Annex VI, and EPA is adding 
clarifying language relating to engines with a power output of 130 kW 
or less.
    First, EPA is revising the regulations to clarify that the urea 
reporting requirements in Sec.  1042.660(b) (which requires an owner or 
operator of any vessel equipped with SCR to report to EPA within 30 
days of any operation of such vessel without the appropriate reductant) 
also apply to Category 1 and Category 2 auxiliary engines on Category 3 
vessels that are covered by Sec.  1042.650(d). This will extend the 
urea reporting requirements to engines between 130 and 600 kW if they 
rely on SCR to meet the Annex VI Tier III NOX limits. 
Engines covered by Sec.  1042.650(d) are subject to emission standards 
and testing requirements under MARPOL Annex VI and the NOX 
Technical Code.
    Second, EPA is revising 40 CFR 1042.650(d) to clarify that, while 
these Category 1 and Category 2 auxiliary engines may be designed with 
on-off NOX controls, Annex VI requires that the engines have 
an EIAPP certificate demonstrating compliance with the applicable 
NOX standards of Annex VI. This includes certification to 
demonstrate compliance with IMO Tier II NOX standards 
anytime the IMO Tier III NOX configuration is disabled.
    EPA has become aware that there is some uncertainty about how the 
scope of EPA's implementation of Annex VI through 40 CFR part 1043 
relates to engines with a power output of 130 kW or less. The existing 
regulations at Sec.  1043.30 state that an EIAPP certificate is 
required for engines with a power output above 130 kW, but the 
standards described in Sec.  1043.60 might be interpreted to apply to 
engines of all sizes. EPA did not intend to appear to create additional 
requirements or authority under 40 CFR part 1043 that is not contained 
in Annex VI or its implementing legislation (the Act to Prevent 
Pollution from Ships). EPA is therefore adding clarifying language to 
Sec.  1043.60, consistent with Regulation 13 of Annex VI and APPS, to 
indicate that the international NOX limits do not apply to 
engines with a power output of 130 kW or less. Note that EPA therefore 
may not issue EIAPP certificates for engines with a power output of 130 
kW or less even if manufacturers request it; this also means that such 
auxiliary engines are not eligible for an exemption under Sec.  
1042.650(d).
(3) Natural Gas Marine Engines
    EPA is also expanding provisions that apply for marine engines 
designed to operate on both diesel fuel and natural gas. Test 
requirements apply separately for each ``fuel type.'' EPA generally 
considers an engine with a single calibration strategy that combines an 
initial pilot injection of diesel fuel to burn natural gas to be a 
single fuel type. This applies even if the natural gas portion must be 
substantially reduced or eliminated to maintain proper engine operation 
at light-load conditions. If the engine has a different calibration 
allowing it to run only on diesel fuel, or on continuous mixtures of 
diesel fuel and natural gas, we would consider it to be a dual-fuel 
engine or a flexible-fuel engine, respectively. These terms are used 
consistently across EPA programs for highway and nonroad applications. 
There is an effort underway to revise the definition of ``dual-fuel'' 
in MARPOL Annex VI, which may be different than EPA's definition. It 
should be noted that the 40 CFR part 1042 certification testing 
requirement differs from that specified in MARPOL Annex VI and the 
NOX Technical Code. While the international protocol 
involves testing only on the engine calibration with the greatest 
degree of diesel fuel, EPA certification requires manufacturers to 
perform testing on each separate fuel type. This would involve one set 
of tests with natural gas (with or without a diesel pilot fuel, as 
appropriate), and an additional set of tests with diesel fuel alone. 
This has been required since we first adopted standards, and this is 
the same policy that applies across all our emission control programs. 
EPA is also including amended regulatory language to more carefully 
describe these testing requirements, and to specify how this applies 
differently for dual-fuel and flexible-fuel engines.
(4) Additional Marine Diesel Amendments
    EPA is making numerous changes across 40 CFR part 1042 to correct 
errors, to add clarification, and to make adjustments based on lessons 
learned from implementing these regulatory provisions. This includes 
the following changes:
     Sec.  1042.1: Correct the tabulated applicability date for 
engines with per-cylinder displacement between 7 and 15 liters; this 
should refer to engines ``at or above'' 7 liters, rather than ``above 7 
liters.''
     Sec.  1042.1: Replace an incorrect reference to 40 CFR 
part 89 with a reference to 40 CFR part 94 for marine engines above 37 
kW.
     Sec.  1042.2: Add a clarifying note to say that something 
other than a conventional ``manufacturer'' may need to certify engines 
that become new after being placed into service (such as engines 
converted from highway or stationary use). This is intended to address 
a possible assumption that only conventional manufacturers can certify 
engines.

[[Page 73956]]

     Sec. Sec.  1042.30, 1042.730, and 1042.825: Consolidate 
information-collection provisions into a single section.
     Sec.  1042.101: Revise the text to more carefully identify 
engine subcategories and better describe the transition between Tier 3 
and Tier 4 standards. These changes are intended to clarify which 
standards apply and are not intended to change the emission standards 
for any particular size or type of engine.
     Sec.  1042.101 and Appendix III: More precisely define 
applicability of specific NTE standards for different types of engines 
and pollutants; correct formulas defining NTE zones and subzones; and 
add clarifying information to identify subzone points that could 
otherwise be derived from existing formulas. None of these changes are 
intended to change the standards, test procedures, or other policies 
for implementing the NTE standards.
     Sec.  1042.101: Clarify the FEL caps for certain engines 
above 3700 kW.
     Sec.  1042.101: Add a specification to define ``continuous 
monitor'' for parameters requiring repeated discrete measurements, as 
described above. The rule also includes further clarification on the 
relationship between on-off NOX controls and engine 
diagnostic systems.
     Sec.  1042.110: Remove the requirement to notify operators 
regarding an unsafe operating condition, since we can more generally 
rely on the broader provision in Sec.  1042.115 that prohibits 
manufacturers from incorporating design strategies that introduce an 
unreasonable safety risk during engine operation.
     Sec.  1042.110: Clarify that using a NOX sensor 
as an alternative to monitoring DEF concentration applies only if the 
system includes an alert to inform operators when DEF quality is 
inadequate. This makes explicit what we believe should have already 
been understood from the requirement as originally drafted.
     Sec.  1042.120: Reduce extended-warranty requirements to 
warranties that are actually provided to the consumer, rather than to 
any published warranties that are offered. The principle is that the 
emission-related warranty should not be less effective for emission-
related items than for items that are not emission-related.
     Sec.  1042.125: Add crankcase vent filters to the list of 
maintenance items.
     Sec.  1042.125: Allow for special maintenance procedures 
that address low-use engines. For example, owners of recreational 
marine vessels may need to perform engine maintenance after a smaller 
number of hours than would otherwise apply based on the limited engine 
operation over time.
     Sec.  1042.125: Establish a minimum maintenance interval 
of 1500 hours for DEF filters. This reflects the technical capabilities 
for filter durability and the expected maintenance in the field.
     Sec.  1042.135: Clarify that ULSD labeling is required 
only for engines that use sulfur-sensitive technology. If an engine can 
meet applicable emission standards without depending on the use of 
ULSD, the manufacturer should not be required to state on the engine 
that ULSD is required.
     Sec.  1042.135: Allow for including optional label content 
only if this does not cause the manufacturer to omit other information 
based on limited availability of space on the label. We modified the 
proposed amendment in response to comments to allow for including 
optional labeling content as long as the additional content doesn't 
cause the space limitations that prevent inclusion of other optional 
information.
     Sec.  1042.201: Clarify that manufacturers may amend their 
application for certification after the end of the model year in 
certain circumstances, but they may not produce engines for a given 
model year after December 31 of the named year.
     Sec.  1042.201: Establish that manufacturers may deliver 
to EPA for testing an engine that is identical to the test engine used 
for certification. This may be necessary if the test engine has 
accumulated too many hours, or if it is unavailable for any reason.
     Sec. Sec.  1042.205 and 1042.840: Replace the requirement 
to submit data from invalid tests with a requirement to simply notify 
EPA in the application for certification if test was invalidated.
     Sec.  1042.235: Add an explicit allowance for carryover 
engine families to include the same kind of within-family running 
changes that are currently allowed over the course of a model year. The 
original text may have been understood to require that such running 
changes be made separate from certifying the engine family for the new 
model year.
     Sec. Sec.  1042.235, 1042.240, and 1042.601: Describe how 
to demonstrate compliance with dual-fuel and flexible-fuel engines. 
This generally involves testing with each separate fuel, or with a 
worst-case fuel blend.
     Sec.  1042.240: Add instructions for calculating 
deterioration factors for sawtooth deterioration patterns, such as 
might be expected for periodic maintenance, such as cleaning or 
replacing diesel particulate filters.
     Sec.  1042.250: Remove references to routine and standard 
tests, and remove the shorter recordkeeping requirement for routine 
data (or data from routine tests). All test records must be kept for 
eight years. With electronic recording of test data, there should be no 
advantage to keeping the shorter recordkeeping requirement for a subset 
of test data. EPA also notes that the eight-year period restarts with 
certification for a new model year if the manufacturer uses carryover 
data.
     Sec.  1042.255: Clarify that rendering information false 
or incomplete after submitting it is the same as submitting false or 
incomplete information. For example, if there is a change to any 
corporate information or engine parameters described in the 
manufacturer's application for certification, the manufacturer must 
amend the application to include the new information.
     Sec.  1042.255: Clarify that voiding certificates for a 
recordkeeping or reporting violation will be limited to certificates 
that relate to the particular recordkeeping or reporting failure.
     Sec.  1042.301: Clarify that the requirements to test 
production engines does not apply for engines that become new and 
subject to emission standards as remanufactured engines.
     Sec.  1042.302: Clarify that manufacturers may fulfill the 
requirement to test each Category 3 production engine by performing the 
test before or after the engine is installed in the vessel. The largest 
Category 3 engines are assembled in the vessel, but some smaller 
Category 3 engines are assembled at a manufacturing facility where they 
can be more easily tested. Manufacturers must perform such testing on 
fully assembled production engines rather than relying on test results 
from test bed engines.
     Sec.  1042.501: Provide instruction on how to verify 
proportional sampling for discrete mode testing where only one batch 
fuel measurement is made over the operating mode. This requires that 
manufacturers hold sampling constant over the sampling period. 
Manufacturers will verify proportionality either over a discrete mode 
by using average exhaust flow rate paired with each recorded sample 
flow rate, or over the entire duty cycle.
     Sec.  1042.501: Remove test procedure specifications that 
are already covered in 40 CFR part 1065.
     Sec.  1042.505: Correct the reference to the ISO C1 duty 
cycle in 40 CFR part 1039.
     Sec.  1042.515: Remove an incorrect cite.
     Sec. Sec.  1042.605 and 1042.610: Revise the reporting 
requirement to require detailed information about the previous

[[Page 73957]]

year, rather than requiring a detailed projection for the year ahead. 
The information required in advance will be limited to a notification 
of plans to use the provisions of these sections.
     Sec.  1042.630: Clarify that dockside examinations are not 
inspections. Vessels subject to Coast Guard inspection are identified 
in 46 U.S.C. 3301.
     Sec. Sec.  1042.601 and 1042.635: Migrate the national 
security exemption to Sec.  1068.225, including the expanded automatic 
exemption related the standards that would otherwise require sulfur-
sensitive technology. See Section XIII.D(2).
     Sec.  1042.640: Migrate engine branding to Sec.  1068.45.
     Sec.  1042.650: Clarify that vessel operators may modify 
certified engines if they will be operated for an extended period 
outside the United States where ULSD will be unavailable. This does not 
preclude the possibility of vessel operators restoring engines to a 
certified configuration in anticipation of bringing the vessel back to 
the United States.
     Sec.  1042.660: Identify the contact information for 
submitting reports related to operation without SCR reductant.
     Sec.  1042.670: Specify that gas turbine engines are 
presumed to have an equivalent power density below 35 kW per liter of 
engine displacement; this is needed to identify which Tier 3 standards 
apply.
     Sec.  1042.701: Clarify that emission credits generated 
under 40 CFR part 94 may be used for demonstrating compliance with the 
Tier 3 and Tier 4 standards in 40 CFR part 1042.
     Sec. Sec.  1042.701 and 1042.730: Describe the process for 
retiring emission credits. This may be referred to as donating credits 
to the environment.
     Sec.  1042.705: Change terminology for counting engines 
from ``point of first retail sale'' to ``U.S.-direction production 
volume.'' This conforms to the usual approach for calculating emission 
credits for nonroad engines.
     Sec.  1042.710: Clarify that it is not permissible to show 
a proper balance of credits for a given model by using emission credits 
from a future model year.
     Sec.  1042.730: Clarify terminology for ABT reports.
     Sec.  1042.810: Clarify that it is only the 
remanufacturing standards of subpart I, not the certification standards 
that are the subject of the applicability determination in Sec.  
1042.810.
     Sec.  1042.830: Add a provision to specifically allow 
voluntary labeling for engines that are not subject to remanufacturing 
standards, and to clarify that the label is required for engines that 
are subject to remanufacturing standards.
     Sec.  1042.901: Update the contact information for the 
Designated Compliance Officer.
     Sec.  1042.901: Revise the definition of ``model year'' to 
correct cites and clarify that the calendar year relates to the time 
that engines are produced under a certificate of conformity.
     Sec. Sec.  1042.901 and 1042.910: Update the reference 
documents for Annex VI and NOX Technical Code to include 
recent changes from the International Maritime Organization.
     Sec.  1042.915: Migrate provisions related to confidential 
information to 40 CFR part 1068.
    We proposed to disallow amending certified configurations after the 
end of the model year. However, manufacturers shared in their comments 
that this would change the field-fix policy that has long since allowed 
for making such changes. We have retracted the proposed change and 
replaced it with a new paragraph that describes how manufacturers may 
amend the application for certification during and after the model 
year, consistent with the current policy regarding field fixes.

J. Miscellaneous EPA Amendments

    EPA is clarifying that the cold NMHC standards specified in 40 CFR 
86.1811-17 do not apply at high altitude. We intended in recent 
amendments to state that the cold CO standards apply at both low and 
high altitude, but inadvertently placed that statement where it also 
covered cold NMHC standards, which contradicts existing regulatory 
provisions that clearly describe the cold NMHC standards as applying 
only for low-altitude testing. The change simply moves the new 
clarifying language to apply only to cold CO standards. We are also 
restoring the cold NMHC standards in paragraph (g)(2), which were 
inadvertently removed as part of the earlier amendments.
    EPA is revising the specifications for Class 2b and Class 3 
vehicles certifying early to the Tier 3 exhaust emission standards 
under 40 CFR 86.1816-18 to clarify that carryover values apply for 
formaldehyde. The Preamble to the earlier final rule described these 
standards properly, but the regulations inadvertently pointed to the 
Tier 3 values for these vehicles.
    EPA is making a minor correction to the In-Use Compliance Program 
under 40 CFR 86.1846-01. The Light-Duty Tier 3 final rule amended this 
section by describing how to use SFTP test results in the compliance 
determination in a way that inadvertently removed a reference to low-
mileage SFTP testing. We are restoring the removed text.
    EPA is revising the instruction for creating road-load coefficients 
for cold temperature testing in 40 CFR 1066.710 to simply refer back to 
40 CFR 1066.305 where this is described more generally. The text 
originally adopted in 40 CFR 1066.710 incorrectly describes the 
calculation for determining those coefficients.
    EPA is also adopting two minor amendments related to highway 
motorcycles. First, we are correcting an error related to the small-
volume provisions for highway motorcycles. The regulation included an 
inadvertent reference to a small-volume threshold based on an annual 
volume of 3,000 motorcycles produced in the United States. As written, 
this would not consider any foreign motorcycle production for 
importation into the United States. This error is corrected by simply 
revising the text to refer to an annual production volume of 
motorcycles produced ``for'' the United States. This change properly 
reflects small-volume production as it relates to compliance with EPA 
standards. Second, we are clarifying the language describing how to 
manage the precision of emission results, both for measured values and 
for calculating values when applying a deterioration factor. This 
involves a new reference to the rounding procedures in 40 CFR part 1065 
to replace the references to outdated ASTM procedures.

K. Competition Vehicles

    The proposal included a clarification related to vehicles used for 
competition to ensure that the Clean Air Act requirements are followed 
for vehicles used on public roads. This clarification is not being 
finalized. EPA supports motorsports and its contributions to the 
American economy and communities all across the country. EPA's focus is 
not (nor has it ever been) on vehicles built or used exclusively for 
racing, but on companies that violate the rules by making and selling 
products that disable pollution controls on motor vehicles used on 
public roads. These unlawful defeat devices lead to harmful pollution 
and adverse health effects. The proposed language was not intended to 
represent a change in the law or in EPA's policies or practices towards 
dedicated competition vehicles. Since our attempt to clarify led to 
confusion, EPA has decided to eliminate the proposed language from the 
final rule.
    EPA will continue to engage with the racing industry and others in 
its support for racing, while maintaining the Agency's focus where it 
has always

[[Page 73958]]

been: Reducing pollution from the cars and trucks that travel along 
America's roadways and through our neighborhoods.

L. Amending 49 CFR Parts 512 and 537 To Allow Electronic Submissions 
and Defining Data Formats for Light-Duty Vehicle Corporate Average Fuel 
Economy (CAFE) Reports

    To improve efficiency and reduce the burden to manufacturers and 
the agencies, NHTSA proposed to amend 49 CFR part 537 to eliminate the 
option for manufacturers to submit pre-model, mid-model and 
supplemental reports on CD-ROMS, and require only one electronic 
submission (for each report) electronically via a method proscribed by 
NHTSA. NHTSA planned to introduce a new electronic format to 
standardize the method for collecting manufacturer's information. NHTSA 
also proposed modifying 49 CFR part 512 to include and protect 
submitted CAFE data elements that need to be treated as confidential 
business information. For the final rule, NHTSA is not finalizing this 
proposal in this rulemaking but will consider electronic submission for 
CAFE reports in a future action.

XIV. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is an economically significant regulatory action that 
was submitted to the Office of Management and Budget (OMB) for review. 
Any changes made in response to OMB recommendations have been 
documented in the docket. The agencies prepared an analysis of the 
potential costs and benefits associated with this action. This 
analysis, the ``Regulatory Impact Analysis--Heavy-Duty GHG and Fuel 
Efficiency Standards,'' is available in the docket. The analyses 
contained in this document are also summarized in Sections VII, VIII, 
and IX of this Preamble.

B. National Environmental Policy Act

    This section describes NHTSA's Environmental Impact Statement (EIS) 
process under the National Environmental Policy Act (NEPA), 42 U.S.C. 
4321-4347, and implementing regulations issued by the Council on 
Environmental Quality (CEQ), 40 CFR parts 1500-1508, and NHTSA, 49 CFR 
part 520. Pursuant to 49 U.S.C. 304a(b) and DOT's ``Final Guidance on 
MAP-21 Section 1319 Accelerated Decision making in Environmental 
Reviews,'' \992\ NHTSA is issuing a Final Environmental Impact 
Statement (FEIS) \993\ concurrently with its final rule. This Preamble 
constitutes the Record of Decision (ROD) for NHTSA's final rule 
establishing Phase 2 fuel efficiency standards for heavy-duty engines 
and vehicles.\994\ NHTSA has determined that concurrent issuance of the 
FEIS and ROD is not precluded by statutory criteria \995\ or 
practicability considerations.
---------------------------------------------------------------------------

    \992\ Section 1319(b) (``Accelerated Decision making in 
Environmental Reviews'') of the Moving Ahead for Progress in the 
21st Century Act (MAP-21), Public Law 112-141, instructed a lead 
agency on an EIS, ``to the maximum extent practicable,'' to develop 
a ``single document that consists of a final environmental impact 
statement and a record of decision.'' DOT implemented this provision 
through guidance, clarifying that ``[i]n the case of a NEPA review 
for a rulemaking where the final rule is the Record of Decision, the 
[DOT operating administration] should make the completed FEIS 
available to the decision maker simultaneously with the final rule, 
unless it is determined that statutory criteria or practicability 
considerations preclude issuance of the combined document.'' See 
https://www.transportation.gov/sites/dot.gov/files/docs/MAP-21_1319_Final_Guidance.pdf. Section 1319 was subsequently repealed 
by Section 1304(j)(2) of the Fixing America's Surface Transportation 
Act (FAST Act), Public Law 114-94. However, in the same Act, 
Congress codified an identical provision at 49 U.S.C. 304a. FAST 
Act, Sec. 1311(a). Because the provision requiring, ``to the maximum 
extent practicable . . . a single document'' was not otherwise 
amended, the requirement and DOT's implementation remain unchanged.
    \993\ The agency's FEIS is available at its Fuel Economy Web 
site (http://www.nhtsa.gov/fuel-economy/), as well as in Docket No. 
NHTSA-2014-0074 on Regulations.gov (http://www.regulations.gov/).
    \994\ See 40 CFR 1505.2.
    \995\ 49 U.S.C. 304a(b)(1)-(2).
---------------------------------------------------------------------------

    The first subsection below describes the agency's NEPA process to 
date, including its scoping notice and Draft Environmental Impact 
Statement (DEIS). The second subsection describes the FEIS, and the 
third subsection discusses the ROD. The final subsection includes other 
regulatory notices related to environmental concerns.
(1) Scoping Notice and Draft Environmental Impact Statement
    Under NEPA, a Federal agency must prepare an EIS on proposals for 
major Federal actions that significantly affect the quality of the 
human environment.\996\ The purpose of an EIS is to inform decision 
makers and the public of the potential environmental impacts of a 
proposed action and reasonable alternative actions the agency could 
take.\997\ The EIS is used by the agency, in conjunction with other 
relevant material, to plan actions and make decisions.
---------------------------------------------------------------------------

    \996\ 40 CFR 1502.3.
    \997\ 40 CFR 1502.1.
---------------------------------------------------------------------------

    On July 9, 2014, NHTSA published a notice of intent to prepare an 
EIS for this rulemaking and requested scoping comments (79 FR 38842). 
The notice invited Federal, State, and local agencies, Indian tribes, 
stakeholders, and the public to participate in the scoping process and 
to help identify the environmental issues and reasonable alternatives 
to be examined in the EIS. NHTSA considered the comments received on 
that notice as it prepared its DEIS.
    NHTSA released a DEIS for this rulemaking on June 19, 2015, 
concurrently with its release of the NPRM.\998\ NHTSA prepared the DEIS 
to analyze and disclose the potential environmental impacts of the HD 
fuel consumption standards and a reasonable range of alternatives. 
Environmental impacts analyzed in the DEIS included those related to 
fuel and energy use, air quality, and climate change. The DEIS also 
described potential environmental impacts to a variety of resource 
areas, including water resources, biological resources, land use and 
development, safety, hazardous materials and regulated wastes, noise, 
socioeconomics, and environmental justice. These resource areas were 
assessed qualitatively in the DEIS.
---------------------------------------------------------------------------

    \998\ The agency's DEIS is available at its Fuel Economy Web 
site (http://www.nhtsa.gov/fuel-economy/), as well as in Docket No. 
NHTSA-2014-0074 on Regulations.gov (http://www.regulations.gov/).
---------------------------------------------------------------------------

    The DEIS analyzed five alternative approaches to regulating HD 
vehicle fuel consumption, including a ``preferred alternative'' and a 
``no action alternative.'' The DEIS evaluated a reasonable range of 
alternatives under NEPA, and analyzed the direct, indirect, and 
cumulative impacts of those alternatives in proportion to their 
significance.
    Because of the link between the transportation sector and GHG 
emissions, NHTSA recognizes the need to consider the possible impacts 
on climate and global climate change in the analysis of the effects of 
its fuel consumption standards. NHTSA also recognizes the difficulties 
and uncertainties involved in such an impact analysis. Accordingly, 
consistent with CEQ regulations on addressing incomplete or unavailable 
information in environmental impact analyses, NHTSA reviewed existing 
credible scientific evidence that was relevant to this analysis and 
summarized it in the DEIS. NHTSA also employed and summarized the 
results of research

[[Page 73959]]

models generally accepted in the scientific community.
    Although the alternatives have the potential to decrease GHG 
emissions substantially, the DEIS found they do not prevent climate 
change, but only result in reductions in the anticipated increases in 
CO2 concentrations, temperature, precipitation, and sea 
level. They will also, to a small degree, delay the point at which 
certain temperature increases and other physical effects stemming from 
increased GHG emissions will occur. As discussed in the DEIS, NHTSA 
presumes that these reductions in climate effects will be reflected in 
reduced impacts on affected resources. The EPA and the U.S. Department 
of Energy served as cooperating agencies in the preparation of the 
DEIS. The DEIS informed NHTSA decision makers in their preparation of 
the NPRM and in the ongoing rulemaking process. In the DEIS and NPRM, 
NHTSA invited comments on the DEIS from Federal, State, and local 
agencies, Indian tribes, stakeholders, and the public by August 31, 
2015. NHTSA mailed (both electronically and through U.S. mail) 
notification of its availability to individuals and entities identified 
in Chapter 10 of the DEIS. In addition, EPA published a Notice of 
Availability of the DEIS on June 26, 2015, officially triggering the 
public comment period.\999\ NHTSA subsequently extended the comment 
period to October 1, 2015.\1000\ Comments on the EIS were also invited 
at the joint NHTSA/EPA public hearings held on the NPRM.
---------------------------------------------------------------------------

    \999\ 80 FR 36803 (Jun. 26, 2015).
    \1000\ 80 FR 53513 (Sep. 4, 2015).
---------------------------------------------------------------------------

(2) Final Environmental Impact Statement
    NHTSA received many written and oral comments to the NPRM and the 
DEIS. The written comments submitted to NHTSA and the transcripts from 
the public hearings are part of the administrative record and are 
available on the Federal Docket, available online at http://www.regulations.gov/, Reference Docket Nos. NHTSA-2014-0074 and NHTSA-
2014-0132. NHTSA reviewed, analyzed, and considered all relevant 
comments it received during the public comment period. The agency then 
updated and revised the DEIS to prepare the FEIS, which is being 
released concurrently with this final rule and ROD. For a more detailed 
discussion of the comments NHTSA received, including the agency's 
responses to those comments, see Chapter 9 of the FEIS.
    In developing the Phase 2 fuel efficiency standards for heavy-duty 
engines and vehicles adopted in this final rule, NHTSA has been 
informed by the analyses contained in the Final Environmental Impact 
Statement, Phase 2 Fuel Efficiency Standards for Medium- and Heavy-Duty 
Engines and Vehicles, Docket No. NHTSA-2014-0074.
    NHTSA will submit the FEIS to EPA, in accordance with CEQ NEPA 
implementing regulations and EPA guidance.\1001\ Prior to submission, 
NHTSA will post the FEIS on its Web site and in the public docket, as 
well as notify stakeholders and interested parties identified in 
Chapter 11 of the FEIS about its availability (both electronically and 
through U.S. mail). EPA will then publish a Notice of Availability of 
the FEIS in the Federal Register.
---------------------------------------------------------------------------

    \1001\ See CEQ implementing regulations at 40 CFR 1506.9; EPA 
EIS filing guidance at 77 FR 51530 (Aug. 24, 2012).
---------------------------------------------------------------------------

(3) Record of Decision
    For Federal actions requiring an EIS, the CEQ regulations instruct 
the action agency to prepare a concise public ``record of decision'' at 
the time of its decision. The ROD must state: (1) The agency's 
decision; (2) all alternatives considered by the agency in reaching its 
decision, specifying the alternative or alternatives that were 
considered to be environmentally preferable; (3) the agency's 
preferences among alternatives based on relevant factors, including 
economic and technical considerations and agency statutory missions; 
(4) the factors balanced by the agency in making its decision, 
including any essential considerations of national policy; (5) how 
these factors and considerations entered into the agency's decision; 
and (6) whether all practicable means to avoid or minimize 
environmental harm from the alternative selected have been adopted, and 
if not, why they were not.\1002\ As stated above, this Preamble 
constitutes the ROD for NHTSA's final rule establishing Phase 2 fuel 
efficiency standards for heavy-duty engines and vehicles.
---------------------------------------------------------------------------

    \1002\ 40 CFR 1505.2.
---------------------------------------------------------------------------

(a) The Agency's Decision
    In the DEIS and FEIS, NHTSA identified Alternative 3 as the 
Preferred Alternative. Alternative 3, as analyzed in the FEIS, is the 
regulation finalized by NHTSA in this rulemaking. The standards would 
result in significant improvements in fuel efficiency for heavy-duty 
engines and vehicles. These final standards are included at the end of 
this document, described extensively in this Preamble, and analyzed for 
economic and environmental impacts in the RIA and FEIS.
    In sum, after carefully reviewing and analyzing all of the 
information in the public record, RIA, FEIS, and public and agency 
comments submitted on the DEIS and NPRM, NHTSA has decided to finalize 
the Preferred Alternative.
(b) Alternatives NHTSA Considered in Reaching Its Decision
    When preparing an EIS, NEPA requires an agency to compare the 
potential environmental impacts of its proposed action and a reasonable 
range of alternatives. In the DEIS and FEIS, NHTSA analyzed a No Action 
Alternative and four action alternatives, which represent a range of 
potential actions the agency could take. The environmental impacts of 
these alternatives, in turn, represent a range of potential 
environmental impacts that could result from NHTSA's chosen action in 
setting fuel efficiency standards for heavy-duty engines and vehicles.
    The No Action Alternative in the DEIS and FEIS assumes that NHTSA 
would not issue a final rule regarding Phase 2 fuel efficiency 
standards for heavy-duty engines and vehicles. Instead, it assumes that 
NHTSA's Phase 1 standards would continue indefinitely. The No Action 
Alternative therefore reflects the average fuel efficiency levels and 
GHG emissions performance that manufacturers would achieve without 
additional regulation. This alternative provided an analytical baseline 
against which to compare the environmental impacts of the other 
alternatives presented in the EIS. NEPA expressly requires agencies to 
consider a ``no action'' alternative in their NEPA analyses and to 
compare the effects of not taking action with the effects of action 
alternatives in order to demonstrate the environmental effects of the 
action alternatives.\1003\
---------------------------------------------------------------------------

    \1003\ See 40 CFR 1502.2(e), 1502.14(d). CEQ has explained that 
``[T]he regulations require the analysis of the no action 
alternative even if the agency is under a court order or legislative 
command to act. This analysis provides a benchmark, enabling 
decision makers to compare the magnitude of environmental effects of 
the action alternatives. [See 40 CFR 1502.14(c).] * * * Inclusion of 
such an analysis in the EIS is necessary to inform Congress, the 
public, and the President as intended by NEPA. [See 40 CFR 
1500.1(a).]'' Forty Most Asked Questions Concerning CEQ's National 
Environmental Policy Act Regulations, 46 FR 18026 (Mar. 23, 1981).
---------------------------------------------------------------------------

    In the DEIS, in addition to the No Action Alternative, NHTSA 
analyzed a reasonable range of action alternatives with fuel efficiency 
standards at various

[[Page 73960]]

levels of stringency, with Alternative 2 the least stringent and 
Alternative 5 the most stringent. The exact levels of stringency for 
each alternative were described in Chapter 2 of the DEIS. As noted in 
the DEIS, based on the different ways the agency could weigh the 
various considerations, NHTSA believed that the ``maximum feasible 
improvement'' in heavy-duty vehicle and engine fuel efficiency fell 
within that range. In the FEIS, the levels of stringency for 
Alternatives 2, 4, and 5 are unchanged from the DEIS and are described 
in Chapter 2 of the FEIS.\1004\ However, Alternative 3 (the Preferred 
Alternative) was revised in response to public comments and additional 
research. The changes to Alternative 3 are explained extensively in 
this Preamble, and are reflected in the FEIS.\1005\
---------------------------------------------------------------------------

    \1004\ The environmental impacts reported for these alternatives 
in the FEIS differ from those reported in the DEIS. These 
differences result from minor changes in modeling assumptions (such 
as VMT, fleet profile, upstream emission levels, etc.), technology 
penetration and effectiveness assumptions, and other incremental 
updates resulting from public comments and additional research.
    \1005\ As a result of these changes, Alternative 3 is more 
stringent than Alternative 4 in some heavy-duty segments, and more 
stringent overall. NHTSA did not renumber the alternatives (to 
maintain increasing stringency from Alternative 2 to Alternative 5) 
in order to allow readers to more easily compare the DEIS to the 
FEIS, as well as to maintain Alternatives 2, 4, and 5 as benchmarks 
to which the Preferred Alternative may be compared.
---------------------------------------------------------------------------

    Alternatives 2 and 5 were intended to provide the lower and upper 
bounds of a reasonable range of alternatives. In the EIS, the agency 
provided environmental analyses of these points, as well as 
intermediate points, to enable decision makers and the public to 
determine the environmental impacts of other points that fall between 
Alternatives 2 and 5. The action alternatives evaluated in the EIS 
therefore provided decision makers with the ability to select from a 
wide variety of other potential alternatives with stringencies that 
fall between Alternatives 2 and 5.
    According to the FEIS, Alternative 5 is the overall Environmentally 
Preferable Alternative because it would result in the largest overall 
reductions in fuel use and emissions of criteria air pollutants, toxic 
air pollutants, and GHGs among the alternatives considered.\1006\ Under 
each action alternative the agency considered, the reduction in fuel 
consumption resulting from greater fuel efficiency causes reductions in 
GHG emissions compared to the No Action Alternative. In addition, as 
fuel consumption declines, emissions that occur during fuel refining 
and distribution also decline. While there may be some increases in 
fuel consumption and associated tailpipe and upstream emissions 
resulting from increased driving due to the fuel efficiency rebound 
effect, these increases are more than offset by reductions resulting 
from the improved fuel efficiency of regulated heavy vehicles, leading 
to a net reduction in total emissions. The criteria air pollutant, 
toxic air pollutant, and GHG emissions reductions are anticipated to 
improve overall health outcomes and reduce the impacts of climate 
change on the human environment. As Alternative 5 would result in the 
greatest reductions in fuel consumption, it also results in the lowest 
total air pollutant and GHG emissions, and is therefore Environmentally 
Preferable.\1007\
---------------------------------------------------------------------------

    \1006\ Although NHTSA is required to identify the 
Environmentally Preferable Alternative under the CEQ regulations (40 
CFR 1505.2(b)), it is under no obligation to select that alternative 
in its decision. This ROD explains the agency's preferences among 
alternatives, the factors balanced by the agency in making its 
decision (including environmental considerations), and how the 
factors and considerations balanced by the agency entered into its 
decision.
    \1007\ For some toxic air pollutants, Alternative 3 is the 
Environmentally Preferable Alternative because it results in the 
greatest reductions of emissions of those pollutants. However, the 
greater overall stringency of Alternative 5 results in greater 
overall emissions reductions among criteria and toxic air 
pollutants. As a consequence, Alternative 5 results in the greatest 
reductions of adverse health effects resulting from heavy duty 
vehicle emissions.
---------------------------------------------------------------------------

    The environmental impacts associated with the alternatives under 
consideration are described in Chapters 3-7 of the FEIS. NHTSA 
considered these environmental impacts in making its decision, and 
incorporates that analysis by reference here.
(c) NHTSA's Preferences Among Alternatives Based on Relevant Factors; 
Factors Balanced by NHTSA in Making Its Decision; and How These Factors 
and Considerations Entered Into NHTSA's Decision
    NHTSA considered various relevant factors in setting Phase 2 fuel 
efficiency standards for heavy-duty engines and vehicles, including 
economic, technical, and environmental considerations, as well as 
safety considerations, consistent with the agency's statutory mission. 
This Preamble, which constitutes the ROD for NHTSA's final rule, 
provides a complete discussion of the agency's preferences among 
alternatives based on relevant factors, the factors balanced by the 
agency in making its decision, and how the factors and considerations 
balanced by the agency entered into its decision.
(d) Mitigation
    The CEQ regulations specify that a ROD must ``state whether all 
practicable means to avoid or minimize environmental harm from the 
alternative selected have been adopted, and if not, why they were 
not.'' \1008\ In essence, this regulation requires NHTSA to address 
mitigation in the ROD.\1009\ The overwhelming majority of the 
environmental effects of NHTSA's action are positive (i.e., beneficial 
environmental impacts) and would not raise issues of mitigation. 
Overall emissions of criteria and toxic air pollutants are generally 
projected to decrease under the final standards as compared to their 
levels under the No Action Alternative. However, analysis of the 
environmental trends reported in the FEIS for the Preferred Alternative 
indicates small emissions increases for some air pollutants in some 
near-term analysis years. The agency forecasts emissions increases for 
some alternatives because, under all the alternatives analyzed in the 
FEIS, increases in vehicle use due to improved fuel efficiency are 
projected to result in growth in total miles traveled by heavy-duty 
vehicles. The growth in VMT outpaces emissions reductions for some 
pollutants, resulting in projected increases for these pollutants. In 
addition, NHTSA's NEPA analysis predicted increases in emissions of 
some air pollutants under certain alternatives based on assumptions 
about the type of technologies manufacturers will use to comply with 
the standards (particularly APU use). However, for the reasons 
described in Section 5.5.2.3 of the RIA, some of those air pollutant 
increases are no longer anticipated to occur.
---------------------------------------------------------------------------

    \1008\ 40 CFR 1505.2(c).
    \1009\ 40 CFR 1508.20.
---------------------------------------------------------------------------

    Although limited harmful impacts of the final standards are 
projected in some near-term analysis years in the FEIS, the overall 
environmental impacts of the final standards are anticipated to be 
overwhelmingly beneficial. NHTSA's authority to promulgate new fuel 
efficiency standards for heavy-duty vehicles and engines does not allow 
the agency to regulate criteria or toxic air pollutants from vehicles 
or factors affecting those emissions, such as driving habits. 
Consequently, NHTSA must set fuel efficiency standards but is unable to 
take steps to mitigate the limited harmful impacts of those standards. 
However, EPA has taken additional action in this final rule to control 
PM emissions resulting from APU use that, for the reasons described

[[Page 73961]]

in Section 5.5.2.3 of the RIA, would mitigate some of the projected 
harmful impacts. Further, Chapter 8 of the FEIS outlines a number of 
other initiatives across the government that could ameliorate the 
environmental impacts of motor vehicle use, including the use of heavy-
duty vehicles.
(4) Other Regulatory Notices Related to Environmental Concerns
    This section includes regulatory determinations related to 
environmental concerns that are not otherwise included in the FEIS. For 
example, NHTSA addresses the following in the FEIS: Conformity 
requirements under the Clean Air Act (Chapter 4.1.1.4), the National 
Historic Preservation Act (Chapter 7.2), and Environmental Justice 
(Chapter 7.5).
(a) Coastal Zone Management Act (CZMA)
    The Coastal Zone Management Act \1010\ provides for the 
preservation, protection, development, and (where possible) restoration 
and enhancement of the nation's coastal zone resources. Under the 
statute, States are provided with funds and technical assistance in 
developing coastal zone management programs. Each participating State 
must submit its program to the Secretary of Commerce for approval. Once 
the program has been approved, any activity of a Federal agency, either 
within or outside of the coastal zone, that affects any land or water 
use or natural resource of the coastal zone must be carried out in a 
manner that is consistent, to the maximum extent practicable, with the 
enforceable policies of the State's program.
---------------------------------------------------------------------------

    \1010\ 16 U.S.C. 1451-1466 (as amended).
---------------------------------------------------------------------------

    NHTSA concludes that the CZMA is not applicable to the agency's 
decision because it does not involve any activity within, or outside 
of, the nation's coastal zones as intended by the statute. These 
standards would mitigate some of the anticipated impacts of global 
climate change, including potential impacts to coastal zones that would 
otherwise have occurred in the absence of agency action. However, the 
agency's action will not directly affect any land or water use or 
natural resource of a coastal zone.
    The agency has conducted a qualitative review of the related 
direct, indirect, and cumulative impacts of the alternatives on 
potentially affected resources, including coastal zones, in the FEIS. 
See Chapter 5.5 of the FEIS.
(b) Floodplain Management (Executive Orders 11988 and 13690; DOT Order 
5650.2)
    These Orders require Federal agencies to avoid the long- and short-
term adverse impacts associated with the occupancy and modification of 
floodplains, and to restore and preserve the natural and beneficial 
values served by floodplains. Executive Order 11988 also directs 
agencies to minimize the impact of floods on human safety, health, and 
welfare, and to restore and preserve the natural and beneficial values 
served by floodplains through evaluating the potential effects of any 
actions the agency may take in a floodplain and ensuring that its 
program planning and budget requests reflect consideration of flood 
hazards and floodplain management. DOT Order 5650.2 sets forth DOT 
policies and procedures for implementing Executive Order 11988. The DOT 
Order requires that the agency determine if a proposed action is within 
the limits of a base floodplain, meaning it is encroaching on the 
floodplain, and whether this encroachment is significant. If 
significant, the agency is required to conduct further analysis of the 
proposed action and any practicable alternatives. If a practicable 
alternative avoids floodplain encroachment, then the agency is required 
to implement it.
    In this rulemaking, the agency is not occupying, modifying, or 
encroaching on floodplains. The agency, therefore, concludes that the 
Orders are not applicable to NHTSA's decision. The agency has, however, 
conducted a review of the alternatives on potentially affected 
resources, including floodplains, in the FEIS. See Chapter 5.5 of the 
FEIS.
(c) Preservation of the Nation's Wetlands (Executive Order 11990 & DOT 
Order 5660.1A)
    These Orders require Federal agencies to avoid, to the extent 
possible, undertaking or providing assistance for new construction 
located in wetlands unless the agency head finds that there is no 
practicable alternative to such construction and that the proposed 
action includes all practicable measures to minimize harms to wetlands 
that may result from such use. Executive Order 11990 also directs 
agencies to take action to minimize the destruction, loss, or 
degradation of wetlands in ``conducting Federal activities and programs 
affecting land use, including but not limited to water and related land 
resources planning, regulating, and licensing activities.'' DOT Order 
5660.1A sets forth DOT policy for interpreting Executive Order 11990 
and requires that transportation projects ``located in or having an 
impact on wetlands'' should be conducted to assure protection of the 
Nation's wetlands. If a project does have a significant impact on 
wetlands, an EIS must be prepared.
    The agency is not undertaking or providing assistance for new 
construction located in wetlands. In addition, the agency's action will 
not affect land use in wetlands, nor is it a transportation project 
``located in or having an impact on wetlands.'' Therefore, the agency 
concludes that these Orders do not apply to NHTSA's decision. The 
agency has, however, conducted a review of the alternatives on 
potentially affected resources, including wetlands. See Section 5.5 of 
the FEIS.
(d) Department of Transportation Act (Section 4(f))
    Section 4(f) of the Department of Transportation Act of 1966 (49 
U.S.C. 303), as amended, is designed to preserve publicly owned 
parklands, waterfowl and wildlife refuges, and significant historic 
sites. Specifically, Section 4(f) provides that DOT agencies cannot 
approve a transportation program or project that requires the use of 
any publicly owned land from a significant public park, recreation 
area, or wildlife and waterfowl refuge, or any land from a significant 
historic site, and results in a greater than de minimis impact unless a 
determination is made that:
    [ssquf] There is no feasible and prudent alternative that 
completely avoids the use of Section 4(f) property, and
    [ssquf] The program or project includes all possible planning to 
minimize harm to the Section 4(f) property resulting from the 
transportation use.
    This rulemaking is not a transportation program or project that 
requires the use of any publicly owned land. As a result, NHTSA 
concludes that Section 4(f) is not applicable to NHTSA's decision.

C. Paperwork Reduction Act

    The information collection activities in these final rules will be 
submitted for approval to the Office of Management and Budget (OMB) 
under the PRA. The Information Collection Request (ICR) document that 
EPA prepared has been assigned EPA ICR number 2394.05 and OMB Control 
Number 2060-0678. You can find a copy of the ICR in the docket for 
these final rules, and it is briefly summarized here. The burden 
estimates in this section account for the collective information 
collection burden imposed

[[Page 73962]]

by both agencies. The information collection requirements are not 
enforceable until OMB approves them.
    The agencies will collect information to ensure compliance with the 
provisions in these rules. This includes a variety of testing, 
reporting and recordkeeping requirements for vehicle and engine 
manufacturers. Section 208(a) of the CAA requires that manufacturers 
provide information the Administrator may reasonably require to 
determine compliance with the regulations; submission of the 
information is therefore mandatory. We will consider confidential all 
information meeting the requirements of section 208(c) of the CAA.
    Respondents/affected entities: Respondents are manufacturers of 
engines and vehicles within the North American Industry Classification 
System (NAICS) and use the coding structure as defined by NAICS. 
336111, 336112, 333618, 336120, 541514, 811112, 811198, 336111, 336112, 
422720, 454312, 541514, 541690, 811198, 333618, 336510, for Motor 
Vehicle Manufacturers, Engine and Truck Manufacturers, Truck Trailer 
Manufacturers, Commercial Importers of Vehicles and Vehicle Components, 
and Alternative Fuel Vehicle Converters and Manufacturers.
    Respondent's obligation to respond: The information that is subject 
to this collection is collected whenever a manufacturer applies for a 
certificate of conformity. Under section 206 of the CAA (42 U.S.C. 
7521), a manufacturer must have a certificate of conformity before a 
vehicle or engine can be introduced into commerce.
    Estimated number of respondents: It is estimated that this 
collection affects approximately 141 engine and vehicle manufacturers.
    Frequency of response: Annually.
    Total estimated burden: The burden to the manufacturers affected by 
these rules has a range based on the number of engines and vehicles a 
manufacturer produces. The estimated average annual respondent burden 
associated with the first three implementation years of the Phase 2 
program is 61,800 hours (see Table XIV-1). This estimated burden for 
engine and vehicle manufacturers is an average estimate for both new 
and existing reporting requirements for calendar years 2017, 2018 and 
2019, in which trailer manufacturers will prepare for and begin 
certifying for Phase 2 while Phase 1 will continue for the other 
affected manufacturers. Burden is defined at 5 CFR 1320.3(b). Burden 
means the total time, effort, or financial resources expended by 
persons to generate, maintain, retain, or disclose or provide 
information to or for a Federal agency. This includes the time needed 
to review instructions; develop, acquire, install, and utilize 
technology and systems for the purposes of collecting, validating, and 
verifying information, processing and maintaining information, and 
disclosing and providing information; adjust the existing ways to 
comply with any previously applicable instructions and requirements; 
train personnel to be able to respond to a collection of information; 
search data sources; complete and review the collection of information; 
and transmit or otherwise disclose the information.

    Table XIV-1--Burden for Reporting and Recordkeeping Requirements
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Number of Affected Engine and Vehicle     141.
 Manufacturers.
Annual Labor Hours for Each Manufacturer  Varies.
 to Prepare and Submit Required
 Information.
                                         -------------------------------
  Total Annual Information Collection     61,800 Hours.
   Burden.
------------------------------------------------------------------------

    Total estimated cost: The estimated average annual cost associated 
with the first three implementation years of the Phase 2 program is 
approximately $8 million. This includes approximately $3 million in 
capital and operation & maintenance costs. This estimated cost for 
engine and vehicle manufacturers is an average estimate for both new 
and existing testing, recordkeeping, and reporting requirements for 
calendar years 2017, 2018 and 2019, in which trailer manufacturers will 
prepare for and begin certifying for Phase 2 while Phase 1 will 
continue for the other affected manufacturers.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in title 40 are listed in 40 CFR part 9. When OMB approves 
this ICR, the Agency will announce that approval in the Federal 
Register and publish a technical amendment to 40 CFR part 9 to display 
the OMB control number for the approved information collection 
activities contained in this final rule.

D. Regulatory Flexibility Act

    I certify that this action will not have a significant economic 
impact on a substantial number of small entities under the RFA. The 
small entities subject to the requirements of this action are small 
businesses. EPA has determined that less than 20 percent, and fewer 
than 100 regulated entities in each sector may experience an impact of 
greater than one percent of their annual revenue. Details of this 
analysis are presented in Chapter 12 of the Regulatory Impact Analysis 
located in the rulemaking docket (EPA-HQ-OAR-2014-0827), and are 
summarized below.
    Pursuant to section 603 of the RFA, the agencies prepared an 
initial regulatory flexibility analysis (IRFA) for the proposed rule. 
Pursuant to section 609(b) of the RFA, the EPA convened a Small 
Business Advocacy Review (SBAR) Panel to obtain advice and 
recommendations from representatives of small entities that would 
potentially be regulated by the rule. A summary of the IRFA and the 
SBAR Panel's recommendations is presented in the proposed rule (at 80 
FR 40542, July 13, 2015). The Final Panel Report is also available in 
the rulemaking docket.
    The agencies identified four industries that would be potentially 
affected by this rulemaking: Alternative fuel engine converters, heavy-
duty engine manufacturers, vocational vehicle chassis manufacturers, 
and trailer manufacturers. The agencies proposed and sought comment on 
the recommendations from the Panel. The flexibilities proposed for the 
engine manufacturers, engine converters, vocational vehicle 
manufacturers, and glider manufacturers are adopted in the final rule 
and fewer than 20 percent of the small entities in those sectors are 
estimated to incur a burden greater than one percent of their annual 
revenue. In addition to the flexibilities proposed for the trailer 
program, the agencies reduced the number of small entities regulated by 
the final rules by limiting the non-box trailer program to three 
distinct trailer types. As a result, 73 small business trailer 
manufacturers have zero burden from this rulemaking. Of the remaining 
small business trailer manufacturers, only 12 percent are estimated to 
have an economic impact greater than one percent of their annual 
revenue. As a result of these findings, EPA believes it can certify 
that these rules will not have a significant economic impact on a 
substantial number of small entities under the RFA. See Chapter 12.7 
and 12.8 of the Regulatory Impact Analysis (RIA) of these rules for a 
more detailed description of the flexibilities adopted for and economic 
effects on the small businesses in these sectors.
(1) Legal Basis for Agency Action
    Heavy-duty vehicles are classified as those with gross vehicle 
weight ratings

[[Page 73963]]

(GVWR) of greater than 8,500 lb. section 202(a) of the Clean Air Act 
(CAA) allows EPA to regulate new vehicles and new engines by 
prescribing emission standards for pollutants which the Administrator 
finds ``may reasonably be anticipated to endanger public health or 
welfare.'' In 2009, EPA found that six greenhouse gases (GHGs) were 
anticipated to endanger public health or welfare, and new motor 
vehicles and new motor vehicle engines contribute to that pollution. 
This finding was upheld by the unanimous court in Coalition for 
Responsible Regulation v. EPA, 684 F. 3d 102 (D.C. Cir. 2012). Acting 
under the authority of the CAA, EPA set the first phase of heavy-duty 
vehicle GHG standards (Phase 1) and specified certification 
requirements for emissions of four GHGs emitted by mobile sources: 
carbon dioxide (CO2), nitrous oxide (N2O), 
methane (CH4), and hydrofluorocarbons (HFC).
(2) Summary of Potentially Affected Small Entities
    Table XIV-2 provides an overview of the primary SBA small business 
categories potentially affected by this regulation. EPA is not aware of 
any small businesses that manufacture complete heavy-duty pickup trucks 
and vans or Class 7 and 8 tractors.

             Table XIV-2--Primary Small Business Categories Potentially Affected by This Regulation
----------------------------------------------------------------------------------------------------------------
                                                                                      Defined as small entity by
     Industry expected in rulemaking         Industry          NAICS description       SBA if less than or equal
                                          NAICS \a\ code                                          to:
----------------------------------------------------------------------------------------------------------------
Alternative Fuel Engine Converters......          333999  Misc. General Purpose       500 employees.
                                                  811198   Machinery.                 $7.5 million (annual
                                                          All Other Automotive         receipts).
                                                           Repair & Maintenance.
Voc. Vehicle Chassis, Class 7 & 8                 336120  Heavy-Duty Truck            1,500 employees.
 Tractor Manufacturers.                                    Manufacturing.
HD Trailer Manufacturers................          336212  Truck Trailer               1,000 employees.
                                                           Manufacturing.
HD Engine Manufacturers.................          336310  Motor Vehicle Gasoline      1,000 employees.
                                                           Engine & Engine Parts.
----------------------------------------------------------------------------------------------------------------
Note:
\a\ North American Industrial Classification System.

    EPA used the criteria for small entities developed by the Small 
Business Administration under the North American Industry 
Classification System (NAICS) as a guide. Information about these 
entities comes from sources including EPA's certification data, trade 
association databases, and previous rulemakings that have affected 
these industries. EPA then found employment information for these 
companies using the business information database Hoover's Online (a 
subsidiary of Dan and Bradstreet). These entities fall under the 
categories listed in the table.
    The agencies believe there are about 178 trailer manufacturers and 
147 of these manufacturers qualify as small entities with 1,000 
employees or less.\1011\ EPA and NHTSA identified ten heavy-duty engine 
manufacturers that are currently certifying natural gas engines. Six of 
these companies are small businesses. Seventeen companies meet EPA 
requirements under 40 CFR part 85 as alternative fuel engine 
converters. We believe all 17 of the engine converters qualify as small 
businesses. Currently, 20 manufacturers that make chassis for 
vocational vehicles certify with EPA under the Phase 1 program and the 
agencies have identified an additional 19 small vocational chassis 
manufacturers that are not currently certifying under Phase 1.
---------------------------------------------------------------------------

    \1011\ The Small Business Administration amended its 
classification criteria for trailer manufacturers between the NPRM 
and this final rule. The threshold for qualifying as a small 
business trailer manufacturer is now 1,000 employees. Previously the 
small business threshold for trailer manufacturers was 500 
employees.
---------------------------------------------------------------------------

    Glider kits and glider vehicles are a subset of tractor and 
vocational vehicles under the final Phase 2 rulemaking (including for 
regulation of criteria pollution emissions). Glider vehicle 
manufacturers traditionally purchase or manufacture new vehicle bodies 
(vocational vehicles or Class 7 and 8 tractors) for use with older 
powertrains and/or complete assembly of these vehicles by installing 
the powertrain. The agencies were aware of four glider vehicle 
manufacturers (for whom glider vehicle production was a primary 
business) at the time of the SBAR Panel and we identified three of 
these manufacturers as small entities. We are not aware of any small 
businesses that produce glider kits for others to assemble.\1012\ 
Public comments to the proposed rule indicated that nearly 1,200 
purchasers of glider kits, and we presume they would all meet the Act's 
definition of ``manufacturer'', which includes anyone who assembles 
motor vehicles. See Section I.E.(1)(c). We believe a majority of these 
manufacturers qualify as small businesses. However, it is likely that 
few of these entities that purchase glider kits do so as their primary 
business. It is likely that many (if not most) of these entities 
assemble gliders for their own use from glider kits produced by large 
heavy-duty vehicle manufacturers. NHTSA is not finalizing fuel 
efficiency regulations applicable to gliders or glider kits at this 
time.
---------------------------------------------------------------------------

    \1012\ Although this discussion is written based on the 
assumption that no small businesses produce glider kits for others 
to assemble, the conclusions would also be valid with respect to 
small entities that produce glider kits for sale, should they exist.
---------------------------------------------------------------------------

(3) Potential Reporting, Recordkeeping and Compliance Burdens
    For any emission control program, EPA must have assurances that the 
regulated products will meet the standards. The program that EPA is 
adopting for manufacturers subject to this rule will include testing, 
reporting, and recordkeeping requirements. Testing requirements for 
these manufacturers include use of EPA's Greenhouse gas Emissions Model 
(GEM) vehicle simulation tool to obtain the overall CO2 
emissions rate for certification of vocational chassis and trailers, 
aerodynamic testing to obtain aerodynamic inputs to GEM for some 
tractor and trailer manufacturers and engine dynamometer testing for 
alternative fuel engine converters to ensure their conversions meet the 
CO2, CH4 and N2O engine standards. 
Reporting requirements will likely include emissions test data or model 
inputs and results, technical data related to the vehicles, and end-of-
year sales information. Manufacturers will have to keep records of this 
information.
(4) Related Federal Rules
    The primary federal rule that is related to the Phase 2 rules under 
consideration is the 2011 Greenhouse

[[Page 73964]]

Gas Emissions and Fuel Efficiency Standards for Medium- and Heavy-Duty 
Engines and Vehicles (76 FR 57106, September 15, 2011). The Phase 1 
program will continue to be in effect in the absence of these final 
rules. Small businesses are exempt under the Phase 1 program. 
California adopted its own greenhouse gas initiative, which places 
aerodynamic requirements on trailers used in long-haul applications.
(5) Summary of SBREFA Panel Process and Panel Outreach
(a) Significant Panel Findings
    The Small Business Advocacy Review Panel (SBAR Panel, or the Panel) 
considered regulatory options and flexibilities to help mitigate 
potential adverse effects on small businesses as a result of these 
rules. During the SBREFA Panel process, the Panel sought out and 
received comments on the regulatory options and flexibilities that were 
presented to SERs and Panel members. The recommendations of the Panel 
are described below and are also located in the SBREFA Final Panel 
Report, which is available in the public docket.
(b) Panel Process
    As required by section 609(b) of the RFA, as amended by SBREFA, we 
also conducted outreach to small entities and convened an SBAR Panel to 
obtain advice and recommendations of representatives of the small 
entities that potentially will be subject to the rule's requirements. 
On October 22, 2014, EPA's Small Business Advocacy Chairperson convened 
a Panel under section 609(b) of the RFA. In addition to the Chair, the 
Panel consisted of the Division Director of the Assessment and 
Standards Division of EPA's Office of Transportation and Air Quality, 
the Chief Counsel for Advocacy of the Small Business Administration, 
and the Administrator of the Office of Information and Regulatory 
Affairs within the Office of Management and Budget.
    As part of the SBAR Panel process, we conducted outreach with 
representatives of small businesses that will potentially be affected 
by the final rulemaking. We met with these Small Entity Representatives 
(SERs) to discuss the potential rulemaking approaches and potential 
options to decrease the impact of the rulemaking on their industries. 
We distributed outreach materials to the SERs; these materials included 
background on the rulemaking, possible regulatory approaches, and 
possible rulemaking alternatives. The Panel met with SERs from the 
industries that will be directly affected by the Phase 2 rules on 
November 5, 2014 (trailer manufacturers) and November 6, 2014 (engine 
converters and vocational vehicle chassis manufacturers) to discuss the 
outreach materials and receive feedback on the approaches and 
alternatives detailed in the outreach packet. The Panel also met with 
SERs on July 19, 2014 for an initial, introductory outreach meeting, 
and held a supplementary outreach meeting with the trailer manufacturer 
SERs on October 28, 2014. The Panel received written comments from the 
SERs following each meeting in response to discussions had at the 
meeting and the questions posed to the SERs by the agency. The SERs 
were specifically asked to provide comment on regulatory alternatives 
that could help to minimize the rule's impact on small businesses.
    The Panel's findings and discussions were based on the information 
that was available during the Panel process and issues that were raised 
by the SERs during the outreach meetings and in their comments. It was 
agreed that EPA should consider the issues raised by the SERs and 
discussions had by the Panel itself, and that EPA should consider 
comments on flexibility alternatives that would help to mitigate 
negative impacts on small businesses to the extent legally allowable by 
the Clean Air Act.
    Alternatives discussed throughout the Panel process included those 
offered in previous or current EPA rulemakings, as well as alternatives 
suggested by SERs and Panel members. A summary of these recommendations 
is detailed below, and a full discussion of the regulatory alternatives 
and hardship provisions discussed and recommended by the Panel can be 
found in the SBREFA Final Panel Report. A complete discussion of the 
provisions for which we are requesting comment and/or proposing in this 
action can be found in Sections IV.E and V.D of this Preamble with a 
summary in Chapter 12 of the RIA. Also, the Panel Report includes all 
comments received from SERs (Appendix B of the Report) and summaries of 
the two outreach meetings that were held with the SERs. In accordance 
with the RFA/SBREFA requirements, the Panel evaluated the 
aforementioned materials and SER comments on issues related to the 
IRFA. The Panel's recommendations from the Final Panel Report are 
discussed below.
(c) Panel Recommendations
(i) Small Business Trailer Manufacturers
    Comments from trailer manufacturer SERs indicated that these 
companies are familiar with most of the technologies presented during 
our outreach, but have no experience with EPA certification and do not 
anticipate they could manage the accounting and reporting requirements 
without additional staff and extensive training. Performance testing, 
which is a common requirement for many of EPA's regulatory programs, is 
largely unfamiliar to these small business manufacturers and the SERs 
believed the cost of testing would be a significant burden on their 
companies. In light of this feedback, the Panel recommended a 
combination of streamlined compliance and targeted exemptions for these 
small businesses based on the specific trailer types that they 
manufacture. The Panel believed these strategies would achieve many of 
the benefits for the environment by driving adoption of CO2-
reducing technologies, while significantly reducing the burden that 
these new regulations would introduce on small businesses.
(ii) Box Trailer Manufacturers
    Box trailer manufacturers have the benefit of relying on the 
aerodynamic technology development initiated through EPA's voluntary 
SmartWay program. The Panel was aware that EPA planned to propose a 
simplified compliance program for all manufacturers, in which 
aerodynamic device manufacturers have the opportunity to test and 
certify their devices with EPA as technologies that can be used by 
trailer manufacturers in their trailer certification. This pre-approved 
technology strategy was intended to provide all trailer manufacturers a 
means of complying with the standards without the burden of testing. In 
the event that this strategy is limited to the early years of the 
trailer program for all manufacturers, the Panel recommended that small 
manufacturers continue to be given the option to use pre-approved 
devices in lieu of testing.
    In the event that small trailer manufacturers adopt pre-approved 
aerodynamic technologies and the appropriate tire technologies for 
compliance, the Panel recommended an alternative compliance pathway in 
which small business trailer manufacturers could simply report to EPA 
that all of their trailers include approved technologies in lieu of 
collecting all of the required inputs for the GEM vehicle simulation.
(iii) Non-Box Trailer Manufacturers
    The Panel recommended no aerodynamic requirements for non-box 
trailers. The non-box trailer SERs indicated that they had no 
experience installing aerodynamic devices and had

[[Page 73965]]

only seen them in prototype-level demonstrations. In terms of the 
aerodynamic devices currently in use, most non-box trailer SERs 
identified unique operations in which their trailers are used that 
preclude the use of those technologies.
    Some non-box trailer manufacturers had experience with LRR tires 
and ATI systems. However, the non-box trailer manufacturer SERs 
indicated that LRR tires are not currently available for some of their 
trailer types. The SERs noted that tire manufacturers are currently 
focused on box trailer applications and there are only a few LRR tire 
models that meet the needs of their customers. The Panel recommended 
EPA ensure appropriate availability of these tires in order for it to 
be deemed a feasible means of achieving these standards and recommended 
a streamlined compliance process based on the availability of 
technologies. The Panel suggested the best compliance option from a 
small business perspective would be for EPA to pre-approve tires, 
similar to the approach being proposed for aerodynamic technologies, 
and to maintain a list that could be used to exempt small businesses 
when no suitable tires are available. However, the Panel recognized the 
difficulties of maintaining an up-to-date list of certified 
technologies. The Panel recommended that, if EPA did not adopt the 
list-based approach, the agency consider a simplified letter-based 
compliance option that allows manufacturers to petition EPA for an 
exemption if they are unable to identify tires that meet the LRR 
performance requirements on a trailer family basis.
(iv) Non-Highway Trailer Manufacturers
    The Panel recommended excluding all trailers that spend a 
significant amount of time in off-road applications. These trailers may 
not spend much time at highway speeds and aerodynamic devices may 
interfere with the vehicle's intended purpose. Additionally, tires with 
lower rolling resistance may not provide the type of traction needed in 
off-road applications.
(v) Compliance Provisions for all Small Trailer Manufacturers
    Due to the potential for reducing a small business's 
competitiveness compared to the larger manufacturers, as well as the 
ABT recordkeeping burden, the Panel recommended that EPA consider small 
business flexibilities to allow small entities to opt out of ABT 
without placing themselves at a competitive disadvantage to larger 
firms that adopt ABT, such as a low volume exemption or requiring only 
LRR where appropriate. EPA was asked to consider flexibilities for 
small businesses that would ease and incentivize their participation in 
ABT, such as streamlined the tracking requirements for small 
businesses. In addition, the Panel recommended that EPA request comment 
on the feasibility and consequences of ABT for the trailer program and 
additional flexibilities that will promote small business 
participation.
(vi) Lead Time Provisions for all Small Trailer Manufacturers
    For all trailer types that will be included in the rule, the Panel 
recommended a 1-year delay in implementation for small trailer 
manufacturers at the start of the program to allow them additional lead 
time to make the proper staffing adjustments and process changes and 
possibly add new infrastructure to meet these requirements. In the 
event that EPA is unable to provide pre-approved technologies for 
manufacturers to choose for compliance, the Panel recommended that EPA 
provide small business trailer manufacturers an additional 1-year delay 
for each subsequent increase in stringency. This additional lead time 
will allow these small businesses to research and market the 
technologies required by the new standards.
(vii) Small Business Alternative Fuel Engine Converters
    To reduce the compliance burden of small business engine converters 
who convert engines in previously-certified complete vehicles, the 
Panel recommended allowing engine compliance to be sufficient for 
certification--meaning that the converted vehicle would not need to be 
recertified as a vehicle. This recommended flexibility would eliminate 
the need for these small manufacturers to gather all of the additional 
component-level information in addition to the engine CO2 
performance necessary to properly certify a vehicle with GEM (e.g., 
transmission data, aerodynamic performance, tire rolling resistance, 
etc.). In addition, the Panel recommended that small engine converters 
be able to submit an engineering analysis, in lieu of measurement, to 
show that their converted engines do not increase N2O 
emissions. Many of the small engine converters are converting SI-
engines, and the catalysts in these engines are not expected to 
substantially impact N2O production. Small engine converters 
that convert CI-engines could likely certify by ensuring that their 
controls require changes to the SCR dosing strategies.
    The Panel did not recommend separate standards for small business 
natural gas engine manufacturers. The Panel stated that it believes 
this would discourage entrance for small manufacturers into this 
emerging market by adding unnecessary costs to a technology that has 
the potential to reduce CO2 tailpipe emissions. In addition, 
the Panel noted that additional leakage requirements beyond a sealed 
crankcase for small business natural gas-fueled CI engines and 
requirements to follow industry standards for leakage could be waived 
for small businesses with minimal impact on overall GHG emissions.
    Finally, the Panel recommended that small engine converters receive 
a one-year delay in implementation for each increase in stringency 
throughout the program. This flexibility will provide small converters 
additional lead time to obtain the necessary equipment and perform 
calibration testing if needed.
(viii) Emergency Vehicle Chassis Manufacturers
    Fire trucks, and many other emergency vehicles, are built for high 
level of performance and reliability in severe-duty applications. Some 
of the CO2-reducing technologies listed in the materials 
could compromise the fire truck's ability to perform its duties and 
many of the other technologies simply provide no benefit in real-world 
emergency applications. The Panel recommended proposing less stringent 
standards for emergency vehicle chassis manufactured by small 
businesses. The Panel suggested that feasible standards could include 
adoption of LRR tires at the baseline Phase 2 level and installation of 
a Phase 2-compliant engine. In addition, the Panel recommended a 
simplified certification approach for small manufacturers who make 
chassis for emergency vehicles that reduces the number of inputs these 
manufacturers must obtain for GEM.
(ix) Off-Road Vocational Vehicle Chassis Manufacturers
    At the time of the Panel process, EPA's intent was to continue the 
exemptions in Phase 1 for off-road and low-speed vocational vehicles 
(see generally 76 FR 57175). These provisions currently apply for 
vehicles that are defined as ``motor vehicles'' per 40 CFR 85.1703, but 
may conduct most of their operations off-road. Vehicles qualifying 
under these provisions must comply with the applicable engine standard, 
but need not comply with a

[[Page 73966]]

vehicle-level GHG standard. The Panel concluded this exemption is 
sufficient to cover the small business chassis manufacturers who design 
chassis for off-road vocational vehicles.
(x) Custom Chassis Manufacturers
    The Panel concluded that chassis designed for specialty operations 
often have limited ability to adopt CO2 and fuel 
consumption-reducing technologies due to their unique use patterns. In 
addition, the manufacturers of these chassis have very small annual 
sales volumes. The Panel recommended that EPA propose a low volume 
exemption for these custom chassis manufacturers. The Panel did not 
receive sufficient information to recommend a specific sales volume, 
but recommended that EPA request comment on how to design a small 
business exemption by means of a volume exemption, and an appropriate 
annual sales volume threshold.
(xi) Glider Manufacturers
    The Panel was aware that EPA would like to reduce the production of 
glider vehicles that have higher emissions of criteria pollutants like 
NOX and PM than current engines, and which could have higher 
GHG emissions than Phase 2 engines. However, the Panel estimated that 
the number of vehicles produced by the small businesses who manufacture 
glider kits is too small to have a substantial impact on the total 
heavy-duty GHG inventory and recommended that existing small businesses 
be allowed to continue assembling glider vehicles without having to 
comply with the GHG requirements.\1013\ The Panel recommended that EPA 
establish an allowance for existing small business glider manufacturers 
to produce some number of glider vehicles for legitimate purposes, such 
as for newer vehicles badly damaged in crashes. The Panel recommended 
that any other limitations on small business glider production be 
flexible enough to allow sales levels as high as the peak levels in the 
2010-2012 timeframe.
---------------------------------------------------------------------------

    \1013\ The Panel was unaware of the enormous incrase in glider 
vehicle production in recent years, and its attendant adverse 
environmental impacts. See section XIII.B.(3) and (4) and RTC 
Section 14.2.
---------------------------------------------------------------------------

E. Unfunded Mandates Reform Act

    This action contains a federal mandate under UMRA, 2 U.S.C. 1531-
1538, that may result in expenditures of $100 million or more for 
state, local and tribal governments, in the aggregate, or the private 
sector in any one year. Accordingly, the agencies have prepared a 
statement required under section 202 of UMRA. The statement is included 
in the docket for this action and briefly summarized here.
    The agencies have prepared a statement of the cost-benefit analysis 
as required by section 202 of the UMRA; this discussion can be found in 
this Preamble, and in the RIA. The agencies believe that this action 
represents the least costly, most cost-effective approach to achieve 
the statutory requirements of the rules. Section IX explains why the 
agencies believe that the fuel savings that will result from this 
action will lead to lower prices economy wide, improving U.S. 
international competitiveness. The costs and benefits associated with 
this action are discussed in more detail above in Section IX and in the 
Regulatory Impact Analysis, as required by the UMRA.
    This action is not subject to the requirements of section 203 of 
UMRA because it contains no regulatory requirements that might 
significantly or uniquely affect small governments.

F. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government.
    In the spirit of Executive Order 13132, and consistent with EPA 
policy to promote communications between EPA and State and local 
governments, EPA specifically solicited comment from State and local 
officials on the proposed rules.
    NHTSA notes that EPCA contains a provision (49 U.S.C. 32919(a)) 
that expressly preempts any State or local government from adopting or 
enforcing a law or regulation related to fuel economy standards or 
average fuel economy standards for automobiles covered by an average 
fuel economy standard under 49 U.S.C. Chapter 329. However, commercial 
medium- and heavy-duty on-highway vehicles and work trucks are not 
``automobiles,'' as defined in 49 U.S.C. 32901(a)(3). In Phase 1 NHTSA 
concluded that EPCA's express preemption provision will not reach the 
fuel efficiency standards to be established in this rulemaking. NHTSA 
is reiterating that conclusion here for the Phase 2 standards.
    NHTSA also considered the issue of implied or conflict preemption. 
The possibility of such preemption is dependent upon there being an 
actual conflict between a standard established by NHTSA in this 
rulemaking and a State or local law or regulation. See Spriestma v. 
Mercury Marine, 537 U.S. 51, 64-65 (2002). At present, NHTSA has no 
knowledge of any State or local law or regulation that will actually 
conflict with one of the fuel efficiency standards to be established in 
this rulemaking.

G. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications as specified in 
Executive Order 13175. These rules will be implemented at the Federal 
level and impose compliance costs only on vehicle and engine 
manufacturers. Tribal governments will be affected only to the extent 
they purchase and use regulated vehicles. Thus, Executive Order 13175 
does not apply to this action.
    Although Executive Order 13175 does not apply to this action, EPA 
and NHTSA specifically solicited additional comment from tribal 
officials in developing this action.

H. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    This action is subject to Executive Order 13045 because it is an 
economically significant regulatory action as defined by Executive 
Order 12866, and the agencies believe that the environmental health or 
safety risk addressed by this action may have a disproportionate effect 
on children. Accordingly, we have evaluated the environmental health or 
safety effects of these risks on children. The results of this 
evaluation are discussed below.
    A synthesis of the science and research regarding how climate 
change may affect children and other vulnerable subpopulations is 
contained in the Technical Support Document for Endangerment or Cause 
or Contribute Findings for Greenhouse Gases under section 202(a) of the 
Clean Air Act, which can be found in the public docket for this action. 
In making those findings, EPA Administrator placed weight on the fact 
that certain groups, including children, are particularly vulnerable to 
climate-related health effects. In those findings, EPA Administrator 
also determined that the health effects of climate change linked to 
observed and projected elevated concentrations of GHGs include the 
increased likelihood of more frequent and intense heat waves, increases 
in ozone concentrations over broad areas of the country, an increase of 
the severity of extreme weather events such as hurricanes and floods, 
and increasing severity of coastal storms due to rising sea levels. 
These effects can all increase

[[Page 73967]]

mortality and morbidity, especially in vulnerable populations such as 
children, the elderly, and the poor. In addition, the occurrence of 
wildfires in North America have increased and are likely to intensify 
in a warmer future. PM emissions from these wildfires can contribute to 
acute and chronic illnesses of the respiratory system, including 
pneumonia, upper respiratory diseases, asthma, and chronic obstructive 
pulmonary disease, especially in children.
    The agencies have estimated reductions in projected global mean 
surface temperature and sea level rise as a result of reductions in GHG 
emissions associated with the standards finalized in this action 
(Section VII and NHTSA's FEIS). Due to their vulnerability, children 
may receive disproportionate benefits from these reductions in 
temperature and the subsequent reduction of increased ozone and 
severity of weather events.
    Children are also more susceptible than adults to many air 
pollutants because of differences in physiology, higher per body weight 
breathing rates and consumption, rapid development of the brain and 
bodily systems, and behaviors that increase chances for exposure. Even 
before birth, the developing fetus may be exposed to air pollutants 
through the mother that affect development and permanently harm the 
individual.
    Infants and children breathe at much higher rates per body weight 
than adults, with infants under one year of age having a breathing rate 
up to five times that of adults.\1014\ In addition, children breathe 
through their mouths more than adults and their nasal passages are less 
effective at removing pollutants, which leads to a higher deposition 
fraction in their lungs.\1015\
---------------------------------------------------------------------------

    \1014\ U.S. Environmental Protection Agency. (2009). 
Metabolically-derived ventilation rates: a revised approach based 
upon oxygen consumption rates. Washington, DC: Office of Research 
and Development. EPA/600/R-06/129F. http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=202543.
    \1015\ Foos, B.; Marty, M.; Schwartz, J.; Bennet, W.; Moya, J.; 
Jarabek, A.M.; Salmon, A.G. (2008) Focusing on children's inhalation 
dosimetry and health effects for risk assessment: an introduction. J 
Toxicol Environ Health 71A: 149-165.
---------------------------------------------------------------------------

    Certain motor vehicle emissions present greater risks to children 
as well. Early life stages (e.g., children) are thought to be more 
susceptible to tumor development than adults when exposed to 
carcinogenic chemicals that act through a mutagenic mode of 
action.\1016\ Exposure at a young age to these carcinogens could lead 
to a higher risk of developing cancer later in life.
---------------------------------------------------------------------------

    \1016\ U.S. Environmental Protection Agency. (2005). 
Supplemental guidance for assessing susceptibility from early-life 
exposure to carcinogens. Washington, DC: Risk Assessment Forum. EPA/
630/R-03/003F. http://www3.epa.gov/raf/publications/pdfs/childrens_supplement_final.pdf.
---------------------------------------------------------------------------

    The adverse effects of individual air pollutants may be more severe 
for children, particularly the youngest age groups, than adults. The 
Integrated Science Assessments and Criteria Documents for a number of 
pollutants affected by these rules, including those for NO2, 
SO2, PM, ozone and CO, describe children as a group with 
greater susceptibility. Section VIII.A.8 discusses a number of 
childhood health outcomes associated with proximity to roadways, 
including evidence for exacerbation of asthma symptoms and suggestive 
evidence for new onset asthma. In general, these studies do not 
identify the specific contaminants associated with adverse effects, 
instead addressing the near-roadway environment as one containing 
numerous exposures potentially associated with adverse health effects.
    There is substantial evidence that people who live or attend school 
near major roadways are more likely to be of a minority race, Hispanic 
ethnicity, and/or low SES. Within these highly exposed groups, 
children's exposure and susceptibility to health effects is greater 
than adults due to school-related and seasonal activities, behavior, 
and physiological factors.
    Section VIII.C and NHTSA's FEIS describe the expected emissions 
reductions for non-GHG co-pollutants resulting from these standards. 
These emissions reductions will lead to reductions in ambient 
concentrations of PM2.5, ozone and other non-GHG co-
pollutants. Children are not expected to experience greater ambient 
concentrations of air pollutants than the general population. However, 
because of their greater susceptibility to air pollution and their 
increased time spent outdoors, it is likely that these standards will 
have particular benefits for children's health.

I. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    This action is not a ``significant energy action'' because it is 
not likely to have a significant adverse effect on the supply, 
distribution or use of energy. In fact, these rules have a positive 
effect on energy supply and use. Because the combination of the fuel 
economy standards and the GHG emission standards will result in 
significant fuel savings, this action encourages more efficient use of 
fuels. Therefore, we have concluded that this action is not likely to 
have any adverse energy effects. Our energy effects analysis is 
described above in Section IX and NHTSA's FEIS.

J. National Technology Transfer and Advancement Act and 1 CFR Part 51

    This action involves technical standards.
    The agencies are using the following voluntary consensus standards 
from SAE International:
     SAE J1025 (August 2012) is a voluntary consensus standard 
describing how to determine a tire's characteristic value for 
revolutions per mile. This replaces the proposed approach in which we 
instructed manufacturers to determine and use tire diameter as an input 
for modeling vehicle emissions.
     SAE J1252 (July 2012) is a voluntary consensus standards 
that describes aerodynamic measurement procedures for wind tunnels. 
Heavy-duty vehicle testing already relies on these reference standards 
under 40 CFR part 1066.
     SAE J1263 (March 2010) and SAE J2263 (December 2008) are 
voluntary consensus standards that together establish a test protocol 
to determine road-load coefficients for properly testing vehicles on a 
chassis dynamometer to simulate in-use operating conditions. Heavy-duty 
vehicle testing already relies on these reference standards under 40 
CFR part 1066.
     SAE J1594 (July 2010) is a voluntary consensus standards 
that describes vehicle aerodynamics terminology. Heavy-duty vehicle 
testing already relies on these reference standards under 40 CFR part 
1066.
     SAE J1930 (October 2008) is a voluntary consensus 
standards that describes terms and abbreviations for engine and vehicle 
technologies. We are adopting an updated standard to reflect the 
current version.
     SAE J2071 (Revised June 1994) is a voluntary consensus 
standards that describes specifications for wind tunnels.
     SAE J2343 (July 2008). This voluntary consensus standard 
establishes a minimum hold time for LNG-fueled vehicles following a 
refueling event before the tank vents to relieve pressure. This is 
described further in Section XIII.A.3.
     SAE J2452 (June 1999) is a voluntary consensus standards 
that describes a procedure for measuring tire rolling resistance as 
part of a coastdown procedure.
     SAE J2966 (September 2013) is a voluntary consensus 
standards that

[[Page 73968]]

describes a protocol for using computational fluid dynamics to 
determine aerodynamic drag.
    The regulations for the Phase 1 standards included a reference to 
SAE J1526 as a test procedure for measuring in-use fuel consumption. An 
updated version of SAE J1526 was adopted in September 2015. As noted in 
the proposed rule, we are revising the regulations to reference the 
updated version of SAE J1526. All SAE documents are available from the 
publisher's Web site at www.sae.org.
    We are adopting a standard to facilitate measurement with fourier 
transform infrared (FTIR) analyzers--ASTM D6348 (February 2012). We are 
also adopting an updated version of ASTM D4809-13, which specifies test 
methods for determining the heat of combustion of liquid hydrocarbon 
fuels for both Phase 1 and Phase 2 standards.
    We are referencing a new supplement to ANSI NGV1, which we already 
use for defining system requirements for compressed natural gas 
vehicles. The supplement from the same publisher is known as CSA IR-1-
15, ``Compressed Natural Gas Vehicle (NGV) High Flow Fueling Connection 
Devices.'' This documents is available from the ANSI Web site at 
www.ansi.org. The supplement will eventually be incorporated into ANSI 
NGV1, at which point we would no longer need to reference to CSA IR-1-
15.
    This action also involves technical standards for which there is no 
available voluntary consensus standard. First, the agencies are 
adopting greenhouse gas emission standards for heavy-duty vehicles that 
depend on computer modeling to predict an emission rate based on 
various engine and vehicle characteristics. Such a model is not 
available from other sources, so EPA has developed the Greenhouse Gas 
Emission Model as a simulation tool for demonstrating compliance with 
emission standards. See Section II for a detailed description of the 
model. A working version of this software is available for download at 
http://www3.epa.gov/otaq/climate/gem.htm.
    Second, 40 CFR part 1037 includes several test procedures involving 
calculation with numerous physical quantities. We are incorporating by 
reference NIST Special Publication 811 to allow for standardization and 
consistency of units and nomenclature. This standard, which already 
applies for 40 CFR parts 1065 and 1066, is published by the National 
Institute of Standards and Technology (Department of Commerce) and is 
available at no charge at www.nist.gov.
    Third, the amendments for marine diesel engines involve technical 
standards related to the requirements that apply internationally. There 
are no voluntary consensus documents that address these technical 
standards. In earlier rulemakings, EPA has adopted an incorporation by 
reference for MARPOL Annex VI and the NOX Technical code in 
40 CFR parts 1042 and 1043. The International Maritime Organization 
adopted changes to these documents in 2013 and 2014, which need to be 
reflected in 40 CFR parts 1042 and 1043. EPA recently adopted the 
updated reference documents in 40 CFR part 1043. As noted in Section 
XIV.H.4, this rule includes the remaining step of incorporating the 
updated IMO documents by reference in 40 CFR part 1042. All these 
documents are available at www.imo.org.

K. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    The agencies believe the human health or environmental risk 
addressed by this action will not have potential disproportionately 
high and adverse human health or environmental effects on minority, 
low-income or indigenous populations. The results of this evaluation 
are discussed below.
    With respect to GHG emissions, the agencies have determined that 
these final rules will not have disproportionately high and adverse 
human health or environmental effects on minority, low-income or 
indigenous populations because they increase the level of environmental 
protection for all affected populations without having any 
disproportionately high and adverse human health or environmental 
effects on any population, including any minority, low-income or 
indigenous population. The reductions in CO2 and other GHGs 
associated with the standards will affect climate change projections, 
and the agencies have estimated reductions in projected global mean 
surface temperatures (Section VII and NHTSA's FEIS). Within communities 
experiencing adverse impacts related to climate change, certain parts 
of the population may be especially vulnerable; these include the poor, 
the elderly, those already in poor health, the disabled, those living 
alone, and/or indigenous populations dependent on one or a few 
resources.\1017\
---------------------------------------------------------------------------

    \1017\ EPA 2009. Technical Support Document for Endangerment and 
Cause of Contribute Findings for Greenhouse Gases under section 
202(a) of the Clean Air Act. Available at: http://www3.epa.gov/climatechange/Downloads/endangerment/Endangerment_TSD.pdf.
---------------------------------------------------------------------------

    For non-GHG co-pollutants such as ozone, PM2.5, and 
toxics, the agencies have concluded that it is not practicable to 
determine whether there will be disproportionately high and adverse 
human health or environmental effects on minority, low income and/or 
indigenous populations from these rules. As discussed in Section VIII 
and NHTSA's FEIS, however, based on the magnitude of the non-GHG co-
pollutant emissions changes predicted to result from these standards, 
EPA and NHTSA expect that there will be improvements in ambient air 
quality that will likely help in mitigating the disparity in racial, 
ethnic, and economically-based exposures.

L. Endangered Species Act (ESA)

    Section 7(a)(2) of the ESA requires federal agencies, in 
consultation with the National Oceanic and Atmospheric Administration 
Fisheries Service and/or the U.S. Fish and Wildlife Service (FWS), to 
ensure that actions they authorize, fund, or carry out are not likely 
to jeopardize the continued existence of federally listed endangered or 
threatened species or result in the destruction or adverse modification 
of designated critical habitat of such species. 16 U.S.C. 1536(a)(2). 
Under relevant implementing regulations, section 7(a)(2) applies only 
to actions where there is discretionary federal involvement or control. 
50 CFR 402.03. Further, consultation is required only for actions that 
``may affect'' listed species or critical habitat. 50 CFR 402.14. 
Consultation is not required where the action has no effect on such 
species or habitat. Under this standard, it is the federal agency 
taking the action that evaluates the action and determines whether 
consultation is required. See 51 FR 19926, 19949 (June 3, 1986). 
Effects of an action include both the direct and indirect effects that 
will be added to the environmental baseline. 50 CFR 402.02. Indirect 
effects are those that are caused by the action, later in time, and 
that are reasonably certain to occur. Id. To trigger a consultation 
requirement, there must be a causal connection between the federal 
action, the effect in question, and the listed species, and the effect 
must be reasonably certain to occur.
    As discussed in this Preamble and the FEIS, the agencies note that 
the projected environmental effects of this rule are highly positive. 
However, the fact that the rule will have overall positive effects on 
the environment does not mean that the rule ``may affect'' any listed 
species or designated critical

[[Page 73969]]

habitat within the meaning of ESA section 7(a)(2) or the implementing 
regulations or require ESA consultation. We have carefully considered 
various types of potential environmental effects, including emissions 
of GHGs and non-GHGs, in reaching the conclusion that ESA consultation 
is not required for this rule.
    With respect to the projected GHG emission reductions, we are 
mindful of significant legal and technical analysis undertaken by FWS 
and the U.S. Department of the Interior in the context of listing the 
polar bear as a threatened species under the ESA. In that context, in 
2008, FWS and DOI expressed the view that the best scientific data 
available were insufficient to draw a causal connection between GHG 
emissions and effects on the species in its habitat.\1018\ The DOI 
Solicitor concluded that where the effect at issue is climate change, 
actions involving GHG emissions cannot pass the ``may affect'' test of 
the section 7 regulations and thus are not subject to ESA consultation. 
Similarly, for this action, in the absence of a causal connection 
between the final rules and an effect to listed species or critical 
habitat that is reasonably certain to occur, no consultation is 
required.
---------------------------------------------------------------------------

    \1018\ See, e.g., 73 FR 28212, 28300 (May 15, 2008); 73 FR 76249 
(Dec. 16, 2008); Memorandum from David Longly Bernhardt, Solicitor, 
U.S. Department of the Interior re: ``Guidance on the Applicability 
of the Endangered Species Act's Consultation Requirements to 
Proposed Actions Involving the Emission of Greenhouse Gases'' (Oct. 
3, 2008).
---------------------------------------------------------------------------

    The agencies have also previously considered issues relating to GHG 
emissions in connection with the requirements of ESA section 7(a)(2). 
Although the GHG emission reductions projected for this rule are large, 
EPA evaluated comparable or larger reductions in assessing this same 
issue in the context of the light duty vehicle GHG emission standards 
for model years 2012-2016 and 2017-2025. There the agency projected 
emission reductions comparable to, or greater than those projected here 
over the lifetimes of the model years in question and, based on air 
quality modeling of potential environmental effects, concluded that 
``EPA knows of no modeling tool which can link these small, time-
attenuated changes in global metrics to particular effects on listed 
species in particular areas. Extrapolating from global metric to local 
effect with such small numbers, and accounting for further links in a 
causative chain, remain beyond current modeling capabilities.'' EPA, 
Light Duty Vehicle Greenhouse Gas Standards and Corporate Average Fuel 
Economy Standards, Response to Comment Document for Joint Rulemaking at 
4-102 (Docket EPA-OAR-HQ-2009-4782). EPA reached this conclusion after 
evaluating issues relating to potential improvements relevant to both 
temperature and oceanographic pH outputs. EPA's ultimate finding was 
that ``any potential for a specific impact on listed species in their 
habitats associated with these very small changes in average global 
temperature and ocean pH is too remote to trigger the threshold for ESA 
section 7(a)(2).'' Id. EPA and NHTSA believe that the same conclusion 
will apply to the present final rule, given that the projected 
CO2 emission reductions are comparable to or less than those 
projected for either of the light duty vehicle rules. See Section 
VII.D.2 and Table VII-41 of this Preamble; See also, e.g., Ground Zero 
Center for Non-Violent Action v. U.S. Dept. of Navy, 383 F. 3d 1082, 
1091-92 (9th Cir. 2004) (where the likelihood of jeopardy to a species 
from a federal action is extremely remote, ESA does not require 
consultation).

M. Congressional Review Act (CRA)

    This action is subject to the CRA, and the agencies will submit a 
rule report to each House of the Congress and to the Comptroller 
General of the United States. This action is a ``major rule'' as 
defined by 5 U.S.C. 804(2).

XV. EPA and NHTSA Statutory Authorities

    As described below, the regulations being adopted are authorized 
separately for EPA and NHTSA under the agencies' respective statutory 
authorities. See Section I for a discussion of these authorities.

A. EPA

    Statutory authority for the vehicle controls is found in CAA 
section 202(a) (which authorizes standards for emissions of pollutants 
from new motor vehicles that emissions cause or contribute to air 
pollution which may reasonably be anticipated to endanger public health 
or welfare), and CAA sections 202(d), 203-209, 216, and 301 (42 U.S.C. 
7521(a), 7521(d), 7522-7543, 7550, and 7601).
    EPA makes certain proposed rules available to the Science Advisory 
Board (SAB), including rules subject to 42 U.S.C. 4365 and rules which 
are not, but which EPA believes should be made available to the SAB. 
EPA provided information to the SAB about this rulemaking and on June 
11, 2014, the chartered SAB discussed the recommendations of its work 
group on the planned action and agreed that no further SAB 
consideration of the rule or its supporting science was merited. We 
note further that the substantial NAS report to NHTSA and to Congress 
evaluating medium- and heavy-duty truck fuel efficiency improvement 
opportunities (see Section I.A.2 (g) above) would serve as a surrogate 
for SAB consultation. See American Petroleum Inst. v. EPA, 665 F. 2d 
1176, 1189 (D.C. Cir. 1981).

 B. NHTSA

    Statutory authority for the fuel consumption standards is found in 
section 103 of the Energy Independence and Security Act of 2007, 49 
U.S.C. 32902(k). EISA authorizes a fuel efficiency improvement program, 
designed to achieve the maximum feasible improvement to be created for 
commercial medium- and heavy-duty on-highway vehicles and work trucks, 
to implement appropriate test methods, measurement metrics, fuel 
economy standards, and compliance and enforcement protocols that are 
appropriate, cost-effective and technologically feasible. To the extent 
motor vehicle safety is implicated, NHTSA's authority to regulate it is 
also derived from the National Traffic and Motor Vehicle Safety Act, 49 
U.S.C. 30101 et seq.

List of Subjects

40 CFR Part 9

    Reporting and recordkeeping requirements.

40 CFR Part 22

    Administrative practice and procedure, Air pollution control, 
Hazardous substances, Hazardous waste, Penalties, Pesticides and pests, 
Poison prevention, Water pollution control.

40 CFR Part 85

    Confidential business information, Imports, Labeling, Motor vehicle 
pollution, Reporting and recordkeeping requirements, Research, 
Warranties.

40 CFR Part 86

    Administrative practice and procedure, Confidential business 
information, Incorporation by reference, Labeling, Motor vehicle 
pollution, Reporting and recordkeeping requirements.

40 CFR Part 600

    Administrative practice and procedure, Electric power, Fuel 
economy, Incorporation by reference, Labeling, Reporting and 
recordkeeping requirements.

[[Page 73970]]

40 CFR Part 1033

    Administrative practice and procedure, Air pollution control.

40 CFR Parts 1036 and 1037

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Confidential business information, Incorporation 
by reference, Labeling, Motor vehicle pollution, Reporting and 
recordkeeping requirements, Warranties.

40 CFR Part 1039

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Confidential business information, Imports, 
Labeling, Penalties, Reporting and recordkeeping requirements, 
Warranties.

40 CFR Part 1042

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Confidential business information, Imports, 
Incorporation by reference, Labeling, Penalties, Reporting and 
recordkeeping requirements, Vessels, Warranties.

40 CFR Part 1043

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Imports, Incorporation by reference, Vessels, 
Reporting and recordkeeping requirements.

40 CFR Parts 1065 and 1066

    Administrative practice and procedure, Air pollution control, 
Incorporation by reference, Reporting and recordkeeping requirements, 
Research.

40 CFR Part 1068

    Administrative practice and procedure, Confidential business 
information, Imports, Incorporation by reference, Motor vehicle 
pollution, Penalties, Reporting and recordkeeping requirements, 
Warranties.

49 CFR Parts 523, 534, and 535

    Fuel economy, Reporting and recordkeeping requirements.

49 CFR Part 538

    Administrative practice and procedure, Fuel economy, Motor 
vehicles, Reporting and recordkeeping requirements.
    For the reasons set out in the Preamble, title 40, chapter I of the 
Code of Federal Regulations is amended as set forth below.

PART 9--OMB APPROVALS UNDER THE PAPERWORK REDUCTION ACT

0
1. The authority citation for part 9 continues to read as follows:

    Authority:  7 U.S.C. 135 et seq., 136-136y; 15 U.S.C. 2001, 
2003, 2005, 2006, 2601-2671; 21 U.S.C. 331j, 346a, 31 U.S.C. 9701; 
33 U.S.C. 1251 et seq., 1311, 1313d, 1314, 1318, 1321, 1326, 1330, 
1342, 1344, 1345(d) and (e), 1361; E.O. 11735, 38 FR 21243, 3 CFR, 
1971-1975 Comp. p. 973; 42 U.S.C. 241, 242b, 243, 246, 300f, 300g, 
300g-1, 300g-2, 300g-3, 300g-4, 300g-5, 300g-6, 300j-1, 300j-2, 
300j-3, 300j-4, 300j-9, 1857 et seq., 6901-6992k, 7401-7671q, 7542, 
9601-9657, 11023, 11048.


0
2. In Sec.  9.1 the table is amended by:
0
a. Adding in numerical order by CFR designation a new undesignated 
center heading ``Control of Emissions from New and In-Use Heavy-Duty 
Highway Engines'' and its entry in numerical order for ``1036.825'';
0
b. Adding in numerical order by CFR designation a new undesignated 
center heading ``Control of Emissions from New Heavy-Duty Motor 
Vehicles'' and its entry in numerical order for ``1037.825''; and
0
c. Adding in numerical order by CFR designation a new undesignated 
center heading ``Control of NOX SOX, and PM 
Emissions from Marine Engines and Vessels Subject to the MARPOL 
Protocol'' and its entries in numerical order for ``1043.40-1043.95''.
    The additions read as follows:


Sec.  9.1  OMB approvals under the Paperwork Reduction Act.

* * * * *

------------------------------------------------------------------------
                   40 CFR citation                      OMB control No.
------------------------------------------------------------------------
 
                              * * * * * * *
------------------------------------------------------------------------
   Control of Emissions From New and In-Use Heavy-Duty Highway Engines
------------------------------------------------------------------------
1036.825............................................           2060-0678
------------------------------------------------------------------------
         Control of Emissions From New Heavy-Duty Motor Vehicles
------------------------------------------------------------------------
1037.825............................................           2060-0678
 
                              * * * * * * *
------------------------------------------------------------------------
  Control of NOX, SOX, and PM Emissions From Marine Engines and Vessels
                     Subject to the Marpol Protocol
------------------------------------------------------------------------
1043.40-1043.95.....................................           2060-0641
 
                              * * * * * * *
------------------------------------------------------------------------

* * * * *

PART 22--CONSOLIDATED RULES OF PRACTICE GOVERNING THE 
ADMINISTRATIVE ASSESSMENT OF CIVIL PENALTIES AND THE REVOCATION/
TERMINATION OR SUSPENSION OF PERMITS

0
3. The authority citation for part 22 continues to read as follows:

    Authority: 7 U.S.C. 136(l); 15 U.S.C. 2615; 33 U.S.C. 1319, 
1342, 1361, 1415 and 1418; 42 U.S.C. 300g-3(g), 6912, 6925, 6928, 
6991e and 6992d; 42 U.S.C. 7413(d), 7524(c), 7545(d), 7547, 7601 and 
7607(a), 9609, and 11045.

Subpart A--General

0
4. Section 22.1 is amended by revising paragraph (a)(2) to read as 
follows:


Sec.  22.1  Scope of this part.

    (a) * * *
    (2) The assessment of any administrative civil penalty under 
sections 113(d), 205(c), 211(d) and 213(d) of the Clean Air Act, as 
amended (42 U.S.C. 7413(d), 7524(c), 7545(d) and 7547(d)), and a 
determination of nonconforming engines, vehicles or equipment under 
sections 207(c) and

[[Page 73971]]

213(d) of the Clean Air Act, as amended (42 U.S.C. 7541(c) and 
7547(d));
* * * * *

Subpart C--Prehearing Procedures

0
5. Section 22.34 is revised to read as follows:


Sec.  22.34  Supplemental rules governing the administrative assessment 
of civil penalties under the Clean Air Act.

    (a) Scope. This section shall apply, in conjunction with Sec. Sec.  
22.1 through 22.32, in administrative proceedings to assess a civil 
penalty conducted under sections 113(d), 205(c), 211(d), and 213(d) of 
the Clean Air Act, as amended (42 U.S.C. 7413(d), 7524(c), 7545(d), and 
7547(d)), and a determination of nonconforming engines, vehicles or 
equipment under sections 207(c) and 213(d) of the Clean Air Act, as 
amended (42 U.S.C. 7541(c) and 7547(d)). Where inconsistencies exist 
between this section and Sec. Sec.  22.1 through 22.32, this section 
shall apply.
    (b) Issuance of notice. Prior to the issuance of a final order 
assessing a civil penalty or a final determination of nonconforming 
engines, vehicles or equipment, the person to whom the order or 
determination is to be issued shall be given written notice of the 
proposed issuance of the order or determination. Service of a complaint 
or a consent agreement and final order pursuant to Sec.  22.13 
satisfies these notice requirements.

PART 85--CONTROL OF AIR POLLUTION FROM MOBILE SOURCES

0
6. The authority citation for part 85 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart F--Exemption of Clean Alternative Fuel Conversions from 
Tampering Prohibition

0
7. Section 85.525 is revised to read as follows:


Sec.  85.525  Applicable standards.

    To qualify for an exemption from the tampering prohibition, 
vehicles/engines that have been converted to operate on a different 
fuel must meet emission standards and related requirements as described 
in this section. The modified vehicle/engine must meet the requirements 
that applied for the OEM vehicle/engine, or the most stringent OEM 
vehicle/engine standards in any allowable grouping. Fleet average 
standards do not apply unless clean alternative fuel conversions are 
specifically listed as subject to the standards.
    (a) If the vehicle/engine was certified with a Family Emission 
Limit for NOX, NOX+HC, NOX+NMOG, or 
particulate matter, as noted on the vehicle/engine emission control 
information label, the modified vehicle/engine may not exceed this 
Family Emission Limit.
    (b) Compliance with greenhouse gas emission standards is 
demonstrated as follows:
    (1) Subject to the following exceptions and special provisions, 
compliance with light-duty vehicle greenhouse gas emission standards is 
demonstrated by complying with the N2O and CH4 
standards and provisions set forth in 40 CFR 86.1818-12(f)(1) and the 
in-use CO2 exhaust emission standard set forth in 40 CFR 
86.1818-12(d) as determined by the OEM for the subconfiguration that is 
identical to the fuel conversion emission data vehicle (EDV):
    (i) If the OEM complied with the light-duty greenhouse gas 
standards using the fleet averaging option for N2O and 
CH4, as allowed under 40 CFR 86.1818-12(f)(2), the 
calculations of the carbon-related exhaust emissions require the input 
of grams/mile values for N2O and CH4, and you are 
not required to demonstrate compliance with the standalone 
CH4 and N2O standards.
    (ii) If the OEM complied with alternate standards for 
N2O and/or CH4, as allowed under 40 CFR 86.1818-
12(f)(3), you may demonstrate compliance with the same alternate 
standards.
    (iii) If the OEM complied with the nitrous oxide (N2O) 
and methane (CH4) standards and provisions set forth in 40 
CFR 86.1818-12(f)(1) or (3), and the fuel conversion CO2 
measured value is lower than the in-use CO2 exhaust emission 
standard, you also have the option to convert the difference between 
the in-use CO2 exhaust emission standard and the fuel 
conversion CO2 measured value into GHG equivalents of 
CH4 and/or N2O, using 298 g CO2 to 
represent 1 g N2O and 25 g CO2 to represent 1 g 
CH4. You may then subtract the applicable converted values 
from the fuel conversion measured values of CH4 and/or 
N2O to demonstrate compliance with the CH4 and/or 
N2O standards.
    (iv) Optionally, compliance with greenhouse gas emission 
requirements may be demonstrated by comparing emissions from the 
vehicle prior to the fuel conversion to the emissions after the fuel 
conversion. This comparison must be based on FTP test results from the 
emission data vehicle (EDV) representing the pre-conversion test group. 
The sum of CO2, CH4, and N2O shall be 
calculated for pre- and post-conversion FTP test results, where 
CH4 and N2O are weighted by their global warming 
potentials of 25 and 298, respectively. The post-conversion sum of 
these emissions must be lower than the pre-conversion conversion 
greenhouse gas emission results. CO2 emissions are 
calculated as specified in 40 CFR 600.113-12. If statements of 
compliance are applicable and accepted in lieu of measuring 
N2O, as permitted by EPA regulation, the comparison of the 
greenhouse gas results also need not measure or include N2O 
in the before and after emission comparisons.
    (2) Compliance with heavy-duty engine greenhouse gas emission 
standards is demonstrated by complying with the CO2, 
N2O, and CH4 standards (or FELs, as applicable) 
and provisions set forth in 40 CFR 1036.108 for the engine family that 
is represented by the fuel conversion emission data engine (EDE). The 
following additional provisions apply:
    (i) If the fuel conversion CO2 measured value is lower 
than the CO2 standard (or FEL, as applicable), you have the 
option to convert the difference between the CO2 standard 
(or FEL, as applicable) and the fuel conversion CO2 measured 
value into GHG equivalents of CH4 and/or N2O, 
using 298 g/hp-hr CO2 to represent 1 g/hp-hr N2O. 
Similarly, you may use 34 g/hp-hr CO2 to represent 1 g/hp-hr 
CH4 for model year 2021 and later engines, and you may use 
25 g/hp-hr CO2 to represent 1 g/hp-hr CH4 for 
earlier engines. You may then subtract the applicable converted values 
from the fuel conversion measured values of CH4 and/or 
N2O to demonstrate compliance with the CH4 and/or 
N2O standards (or FEL, as applicable).
    (ii) Small volume conversion manufacturers may demonstrate 
compliance with N2O standards based on an engineering 
analysis.
    (iii) For conversions of engines installed in vocational vehicles 
subject to Phase 2 standards under 40 CFR 1037.105 or in tractors 
subject to Phase 2 standards under 40 CFR 1037.106, conversion 
manufacturers may omit a demonstration related to the vehicle-based 
standards, as long as they have a reasonable technical basis for 
believing that the modified vehicle continues to meet those standards.
    (3) Subject to the following exceptions and special provisions, 
compliance with greenhouse gas emission standards for heavy-duty 
vehicles subject to 40 CFR 86.1819 is demonstrated by complying with 
the N2O and CH4 standards and provisions set 
forth in 40 CFR 86.1819 and the in-use CO2 exhaust emission 
standard set forth in 40 CFR 86.1819-14(b) as determined by the OEM for 
the

[[Page 73972]]

subconfiguration that is identical to the fuel conversion emission data 
vehicle (EDV):
    (i) If the OEM complied with alternate standards for N2O 
and/or CH4, as allowed under 40 CFR 86.1819-14(c) you may 
demonstrate compliance with the same alternate standards.
    (ii) If you are unable to meet either the N2O or 
CH4 standards and your fuel conversion CO2 
measured value is lower than the in-use CO2 exhaust emission 
standard, you may also convert the difference between the in-use 
CO2 exhaust emission standard and the fuel conversion 
CO2 measured value into GHG equivalents of CH4 
and/or N2O, using 298 g CO2 to represent 1 g 
N2O. Similarly, you may use 34 g CO2 to represent 
1 g CH4.for model year 2021 and later vehicles, and you may 
use 25 g CO2 to represent 1 g CH4 for earlier 
vehicles. You may then subtract the applicable converted values from 
the fuel conversion measured values of CH4 and/or 
N2O to demonstrate compliance with the CH4 and/or 
N2O standards.
    (iii) You may alternatively comply with the greenhouse gas emission 
requirements by comparing emissions from the vehicle before and after 
the fuel conversion. This comparison must be based on FTP test results 
from the emission data vehicle (EDV) representing the pre-conversion 
test group. The sum of CO2, CH4, and 
N2O shall be calculated for pre- and post-conversion FTP 
test results, where CH4 and N2O are weighted by 
their global warming potentials as described in paragraph (b)(3)(ii) of 
this section. The post-conversion sum of these emissions must be lower 
than the pre-conversion greenhouse gas emission result. Calculate 
CO2 emissions as specified in 40 CFR 600.113. If we waive 
N2O measurement requirements based on a statement of 
compliance, disregard N2O for all measurements and 
calculations under this paragraph (b)(3)(iii).
    (c) Conversion systems for engines that would have qualified for 
chassis certification at the time of OEM certification may use those 
procedures, even if the OEM did not. Conversion manufacturers choosing 
this option must designate test groups using the appropriate criteria 
as described in this subpart and meet all vehicle chassis certification 
requirements set forth in 40 CFR part 86, subpart S.

Subpart O--Urban Bus Rebuild Requirements

0
8. Section 85.1406 is amended by revising paragraph (f)(2) to read as 
follows:


Sec.  85.1406  Certification.

* * * * *
    (f) * * *
    (2) If the equipment certifier disagrees with such determination of 
nonconformity and so advises the Agency, the Administrator shall afford 
the equipment certifier and other interested persons an opportunity to 
present their views and evidence in support thereof at a public hearing 
conducted in accordance with procedures found in 40 CFR part 1068, 
subpart G.

Subpart P--Importation of Motor Vehicles and Motor Vehicle Engines

0
9. Section 85.1508 is amended by revising paragraph (c) to read as 
follows:


Sec.  85.1508  ``In Use'' inspections and recall requirements.

* * * * *
    (c) A certificate holder will be notified whenever the 
Administrator has determined that a substantial number of a class or 
category of the certificate holder's vehicles or engines, although 
properly maintained and used, do not conform to the regulations 
prescribed under section 202 when in actual use throughout their useful 
lives (as determined under section 202(d)). After such notification, 
the Recall Regulations at 40 CFR part 1068, subpart G, shall govern the 
certificate holder's responsibilities and references to a manufacturer 
in the Recall Regulations shall apply to the certificate holder.

0
10. Section 85.1513 is amended by revising paragraph (e)(4) to read as 
follows:


Sec.  85.1513  Prohibited acts; penalties.

* * * * *
    (e) * * *
    (4) Hearings on suspensions and revocations of certificates of 
conformity or of eligibility to perform modification/testing under 
Sec.  85.1509 shall be held in accordance with 40 CFR part 1068, 
subpart G.
* * * * *

Subpart R--Exclusion and Exemption of Motor Vehicles and Motor 
Vehicle Engines

0
11. Section 85.1701 is amended by revising paragraph (a)(1) to read as 
follows:


Sec.  85.1701  General applicability.

    (a) * * *
    (1) Beginning January 1, 2014, the exemption provisions of 40 CFR 
part 1068, subpart C, apply instead of the provisions of this subpart 
for heavy-duty motor vehicle engines regulated under 40 CFR part 86, 
subpart A, except that the nonroad competition exemption of 40 CFR 
1068.235 and the nonroad hardship exemption provisions of 40 CFR 
1068.245, 1068.250, and 1068.255 do not apply for motor vehicle 
engines.
* * * * *

0
12. Section 85.1703 is amended by adding paragraph (b) to read as 
follows:


Sec.  85.1703  Definition of motor vehicle.

* * * * *
    (b) Note that, in applying the criterion in paragraph (a)(2) of 
this section, vehicles that are clearly intended for operation on 
highways are motor vehicles. Absence of a particular safety feature is 
relevant only when absence of that feature would prevent operation on 
highways.

0
13. Section 85.1706 is amended by revising paragraph (b) to read as 
follows:


Sec.  85.1706  Pre-certification exemption.

* * * * *
    (b) Any manufacturer that desires a pre-certification exemption and 
is in the business of importing, modifying or testing uncertified 
vehicles for resale under the provisions of 40 CFR 85.1501 through 
85.1515, must send the request to the Designated Compliance Officer as 
specified in 40 CFR 1068.30. The Designated Compliance Officer may 
require such manufacturers to submit information regarding the general 
nature of the fleet activities, the number of vehicles involved, and a 
demonstration that adequate record-keeping procedures for control 
purposes will be employed.

0
14. Section 85.1711 is revised to read as follows:


Sec.  85.1711  Submission of exemption requests.

    Requests for exemption or further information concerning exemptions 
and/or the exemption request review procedure should be addressed to 
the Designated Compliance Officer as specified at 40 CFR 1068.30.


Sec. Sec.  85.1713 and 85.1714   [Removed]

0
15. Remove and reserve Sec. Sec.  85.1713 and 85.1714.

Subpart T--Emission Defect Reporting Requirements

0
16. Section 85.1901 is revised to read as follows:


Sec.  85.1901  Applicability.

    (a) The requirements of this subpart shall be applicable to all 
1972 and later model year motor vehicles and motor vehicle engines, 
except that the provisions of 40 CFR 1068.501 apply

[[Page 73973]]

instead for heavy-duty motor vehicle engines certified under 40 CFR 
part 86, subpart A, and for heavy-duty motor vehicles certified under 
40 CFR part 1037 starting January 1, 2018.
    (b) The requirement to report emission-related defects affecting a 
given class or category of vehicles or engines shall remain applicable 
for five years from the end of the model year in which such vehicles or 
engines were manufactured.

0
17. Section 85.1902 is revised to read as follows:


Sec.  85.1902  Definitions.

    For the purposes of this subpart and unless otherwise noted:
    (a) Act means the Clean Air Act, 42 U.S.C. 7401-7671q, as amended.
    (b) Emission-related defect means:
    (1) A defect in design, materials, or workmanship in a device, 
system, or assembly described in the approved Application for 
Certification that affects any parameter or specification enumerated in 
appendix VIII of this part; or
    (2) A defect in the design, materials, or workmanship in one or 
more emission-related parts, components, systems, software or elements 
of design which must function properly to ensure continued compliance 
with emission standards.
    (c) Useful life has the meaning given in section 202(d) of the Act 
(42 U.S.C.7521(d)) and regulations promulgated thereunder.
    (d) Voluntary emissions recall means a repair, adjustment, or 
modification program voluntarily initiated and conducted by a 
manufacturer to remedy any emission-related defect for which direct 
notification of vehicle or engine owners has been provided, including 
programs to remedy defects related to emissions standards for 
CO2, CH4, N2O, and/or carbon-related 
exhaust emissions.
    (e) Ultimate purchaser has the meaning given in section 216 of the 
Act (42 U.S.C.7550).
    (f) Manufacturer has the meaning given in section 216 of the Act 
(42 U.S.C.7550).

0
18. Section 85.1906 is amended by revising paragraph (a) to read as 
follows:


Sec.  85.1906   Report filing: Record retention.

    (a) The reports required by Sec. Sec.  85.1903 and 85.1904 shall be 
sent to the Designated Compliance Officer as specified at 40 CFR 
1068.30.
* * * * *

Subpart V--Emissions Control System Performance Warranty 
Regulations and Voluntary Aftermarket Part Certification Program

0
19. Section 85.2109 is amended by revising paragraph (a)(6) to read as 
follows:


Sec.  85.2109   Inclusion of warranty provisions in owners' manuals and 
warranty booklets.

    (a) * * *
    (6) An explanation that an owner may obtain further information 
concerning the emission performance warranty or that an owner may 
report violations of the terms of the Emission Performance Warranty by 
contacting the Designated Compliance Officer as specified at 40 CFR 
1068.30 (Attention: Warranty Claim).
* * * * *

0
20. Section 85.2110 is amended by revising paragraph (b) to read as 
follows:


Sec.  85.2110   Submission of owners' manuals and warranty statements 
to EPA.

* * * * *
    (b) All materials described in paragraph (a) of this section shall 
be sent to the Designated Compliance Officer as specified at 40 CFR 
1068.30 (Attention: Warranty Booklet).

PART 86 --CONTROL OF EMISSIONS FROM NEW AND IN-USE HIGHWAY VEHICLES 
AND ENGINES

0
21. The authority citation for part 86 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

0
22. Section 86.1 is amended by adding paragraph (c)(2), revising 
paragraph (g)(4), and removing and reserving paragraph (g)(5).
    The addition and revision read as follows:


Sec.  86.1  Incorporation by reference.

* * * * *
    (c) * * *
    (2) CSA IR-1-15, Compressed Natural Gas Vehicle (NGV) High Flow 
Fueling Connection Devices--Supplement to NGV 1-2006, ANSI approved 
August 26, 2015, IBR approved for Sec.  86.1813-17(f),
* * * * *
    (g) * * *
    (4) SAE J1877, Recommended Practice for Bar-Coded Vehicle 
Identification Number Label, July 1994, IBR approved for Sec.  86.1807-
01(f).
    (5) [Reserved]
* * * * *

0
23. Revise the heading of subpart A to read as follows:

Subpart A--General Provisions for Heavy-Duty Engines and Heavy-Duty 
Vehicles


Sec.  86.001-35  [Removed]

0
24. Remove Sec.  86.001-35.

0
25. Section 86.004-2 is amended by revising the definition of 
``Emergency vehicle'' to read as follows:


Sec.  86.004-2  Definitions.

* * * * *
    Emergency vehicle has the meaning given in 40 CFR 1037.801.
* * * * *

0
26. Section 86.004-25 is amended as follows:
0
a. By revising the introductory text and paragraph (b)(3)(iii)(A).
0
b. By removing paragraph (b)(3)(vi).
0
c. By revising paragraphs (b)(4)(i), (b)(4)(iii)(D), (b)(4)(iii)(F), 
and (b)(6)(i)(E).
0
d. By adding paragraph (i).
    The addition and revisions read as follows:


Sec.  86.004-25  Maintenance.

    Section 86.004-25 includes text that specifies requirements that 
differ from Sec.  86.094-25. Where a paragraph in Sec.  86.094-25 is 
applicable to Sec.  86.004-25, this may be indicated by specifying the 
corresponding paragraph and the statement ``[Reserved]. For guidance 
see Sec.  86.094-25.''.
* * * * *
    (b) * * *
    (3) * * *
    (iii) * * *
    (A) Crankcase ventilation valves and filters.
* * * * *
    (4) * * *
    (i) For diesel-cycle heavy-duty engines, the adjustment, cleaning, 
repair, or replacement of the following items shall occur at 50,000 
miles (or 1,500 hours) of use and at 50,000-mile (or 1,500-hour) 
intervals thereafter:
    (A) Exhaust gas recirculation system related filters and coolers.
    (B) Crankcase ventilation valves and filters.
    (C) Fuel injector tips (cleaning only).
    (D) DEF filters.
* * * * *
    (iii) * * *
    (D) Particulate trap or trap oxidizer systems including related 
components (adjustment and cleaning only for filter element, 
replacement of the filter element is not allowed during the useful 
life).
* * * * *
    (F) Catalytic converter (adjustment and cleaning only for catalyst 
beds,

[[Page 73974]]

replacement of the bed is not allowed during the useful life).
* * * * *
    (6)(i) * * *
    (E) Crankcase ventilation valves and filters.
* * * * *
    (i) Notwithstanding the provisions of paragraph (b)(4) and (6) of 
this section, manufacturers may schedule replacement or repair of 
particulate trap (or trap oxidizer) systems or catalytic converters 
(including NOX adsorbers), provided that the manufacturer 
demonstrates to the Administrator's satisfaction that the repair or 
replacement will be performed according to the schedule and the 
manufacturer pays for the repair or replacement.

0
27. Section 86.004-28 is amended by revising paragraph (i) introductory 
text and adding paragraph (j) to read as follows:


Sec.  86.004-28  Compliance with emission standards.

* * * * *
    (i) This paragraph (i) describes how to adjust emission results 
from model year 2020 and earlier heavy-duty engines equipped with 
exhaust aftertreatment to account for regeneration events. This 
provision only applies for engines equipped with emission controls that 
are regenerated on an infrequent basis. For the purpose of this 
paragraph (i), the term ``regeneration'' means an event during which 
emission levels change while the aftertreatment performance is being 
restored by design. Examples of regenerations are increasing exhaust 
gas temperature to remove sulfur from an adsorber or increasing exhaust 
gas temperature to oxidize PM in a trap. For the purpose of this 
paragraph (i), the term ``infrequent'' means having an expected 
frequency of less than once per transient test cycle. Calculation and 
use of adjustment factors are described in paragraphs (i)(1) through 
(5) of this section. If your engine family includes engines with one or 
more AECDs for emergency vehicle applications approved under paragraph 
(4) of the definition of defeat device in Sec.  86.004-2, do not 
consider additional regenerations resulting from those AECDs when 
calculating emission factors or frequencies under this paragraph (i).
* * * * *
    (j) For model year 2021 and later engines using aftertreatment 
technology with infrequent regeneration events that may occur during 
testing, take one of the following approaches to account for the 
emission impact of regeneration:
    (1) You may use the calculation methodology described in 40 CFR 
1065.680 to adjust measured emission results. Do this by developing an 
upward adjustment factor and a downward adjustment factor for each 
pollutant based on measured emission data and observed regeneration 
frequency as follows:
    (i) Adjustment factors should generally apply to an entire engine 
family, but you may develop separate adjustment factors for different 
configurations within an engine family. Use the adjustment factors from 
this section for all testing for the engine family.
    (ii) You may use carryover or carry-across data to establish 
adjustment factors for an engine family as described in Sec.  86.001-
24(f), consistent with good engineering judgment.
    (iii) Identify the value of F in each application for the 
certification for which it applies.
    (2) You may ask us to approve an alternate methodology to account 
for regeneration events. We will generally limit approval to cases 
where your engines use aftertreatment technology with extremely 
infrequent regeneration and you are unable to apply the provisions of 
this section.
    (3) You may choose to make no adjustments to measured emission 
results if you determine that regeneration does not significantly 
affect emission levels for an engine family (or configuration) or if it 
is not practical to identify when regeneration occurs. If you choose 
not to make adjustments under paragraph (j)(1) or (2) of this section, 
your engines must meet emission standards for all testing, without 
regard to regeneration.


Sec.  86.004-30  [Removed]

0
28. Remove Sec.  86.004-30.

0
29. Section 86.007-11 is amended by
0
a. Revising the introductory text and paragraphs (a)(1)(ii) and (iii), 
(2)(ii), and (g).
0
b. Adding and reserving paragraph (i).
0
c. Adding paragraph (j).
    The revisions and addition read as follows:


Sec.  86.007-11  Emission standards and supplemental requirements for 
2007 and later model year diesel heavy-duty engines and vehicles.

    This section applies to new 2007 and later model year diesel heavy-
duty engines and vehicles. Starting in model year 2021, this section 
also applies to all heavy HDE, regardless of fuel or combustion cycle 
(see 40 CFR 1036.140(a) and 1036.150(c)). Section 86.007-11 includes 
text that specifies requirements that differ from Sec.  86.004-11. 
Where a paragraph in Sec.  86.004-11 is identical and applicable to 
Sec.  86.007-11, this may be indicated by specifying the corresponding 
paragraph and the statement ``[Reserved]. For guidance see Sec.  
86.004-11.''
    (a)(1) * * *
    (ii)(A) Nonmethane hydrocarbon (NMHC) for engines fueled with 
diesel fuel. 0.14 grams per brake horsepower-hour (0.052 grams per 
megajoule).
    (B) Nonmethane-nonethane hydrocarbon (NMNEHC) for engines fueled 
with natural gas or liquefied petroleum gas. 0.14 grams per brake 
horsepower-hour (0.052 grams per megajoule).
    (C) Nonmethane hydrocarbon equivalent (NMHCE) for engines fueled 
with methanol. 0.14 grams per brake horsepower-hour (0.052 grams per 
megajoule).
    (iii) Carbon monoxide. 15.5 grams per brake horsepower-hour (5.77 
grams per megajoule).
* * * * *
    (2) * * *
    (ii) Shut down the engine after completing the test interval and 
allow 201 minutes to elapse. This is the hot soak.
* * * * *
    (g) Model year 2018 and later engines at or above 56 kW that will 
be installed in specialty vehicles as allowed by 40 CFR 1037.605 may 
meet alternate emission standards as follows:
    (1) The engines must be of a configuration that is identical to one 
that is certified under 40 CFR part 1039, and meet the following 
additional standards using the same duty cycles that apply under 40 CFR 
part 1039:
    (i) The engines must be certified with a Family Emission Limit for 
PM of 0.020 g/kW-hr.
    (ii) Diesel-fueled engines using selective catalytic reduction must 
meet an emission standard of 0.1 g/kW-hr for N2O.
    (2) Except as specified in this paragraph (g), engines certified 
under this paragraph (g) must meet all the requirements that apply 
under 40 CFR part 1039 instead of the comparable provisions in this 
subpart A. Before shipping engines under this section, you must have 
written assurance from the vehicle manufacturers that they need a 
certain number of exempted engines under this section. In your annual 
production report under 40 CFR 1039.250, count these engines separately 
and identify the vehicle manufacturers that will be installing them. 
Treat these engines as part of the corresponding engine family under 40

[[Page 73975]]

CFR part 1039 for compliance purposes such as selective enforcement 
audits, in-use testing, defect reporting, and recall.
    (3) The engines must be labeled as described in Sec.  86.095-35, 
with the following statement instead of the one specified in Sec.  
86.095-35(a)(3)(iii)(H): ``This engine conforms to alternate standards 
for specialty vehicles under 40 CFR 86.007-11(g)''. Engines certified 
under this paragraph (g) may not have the label specified for nonroad 
engines in 40 CFR part 1039 or any other label identifying them as 
nonroad engines.
    (4) In a separate application for a certificate of conformity, 
identify the corresponding nonroad engine family, describe the label 
required under this paragraph (g), state that you meet applicable 
diagnostic requirements under 40 CFR part 1039, and identify your 
projected U.S.-directed production volume.
    (5) No additional certification fee applies for engines certified 
under this paragraph (g).
    (6) Engines certified under this paragraph (g) may not generate or 
use emission credits under this part or under 40 CFR part 1039. The 
vehicles in which these engines are installed may generate or use 
emission credits as described in 40 CFR part 1037.
    (7) Engines may instead meet standards for heavy-duty highway 
engines in California, as demonstrated by an Executive Order issued by 
the California Air Resources Board.
* * * * *
    (i) [Reserved]
    (j) Engines installed in new glider vehicles are subject to the 
standards of this section as specified in 40 CFR part 1037.


Sec.  86.007-25  [Removed]

0
30. Remove Sec.  86.007-25.


Sec.  86.007-30  [Amended]

0
31. Section 86.007-30 is amended by removing and reserving paragraph 
(d).


Sec.  86.007-35  [Removed]

0
32. Remove Sec.  86.007-35.

0
33. Section 86.008-10 is amended by:
0
a. Adding introductory text.
0
b. Revising paragraphs (a)(1)(ii) and (iii);
0
c. Removing and reserving paragraph (f); and
0
d. Revising paragraph (g).
    The revisions read as follows:


Sec.  86.008-10  Emission standards for 2008 and later model year Otto-
cycle heavy-duty engines and vehicles.

    This section applies to new 2008 and later model year Otto-cycle 
heavy-duty engines and vehicles. Starting in model year 2021, this 
section applies to light HDE and medium HDE, but it no longer applies 
to heavy HDE (see 40 CFR 1036.140(a) and 1036.150(c)).
    (a)(1) * * *
    (ii)(A) Nonmethane hydrocarbon (NMHC) for engines fueled with 
gasoline. 0.14 grams per brake horsepower-hour (0.052 grams per 
megajoule).
    (B) Nonmethane-nonethane hydrocarbon (NMNEHC) for engines fueled 
with natural gas or liquefied petroleum gas. 0.14 grams per brake 
horsepower-hour (0.052 grams per megajoule).
    (C) Nonmethane hydrocarbon equivalent (NMHCE) for engines fueled 
with methanol. 0.14 grams per brake horsepower-hour (0.052 grams per 
megajoule).
    (D) A manufacturer may elect to include any or all of its Otto-
cycle HDE families in any or all of the hydrocarbon emission ABT 
programs for HDEs, within the restrictions described in Sec.  86.007-15 
or Sec.  86.004-15. If the manufacturer elects to include engine 
families in any of these programs, the hydrocarbon FEL may not exceed 
0.30 grams per brake horsepower-hour. This ceiling value applies 
whether credits for the family are derived from averaging, banking, or 
trading programs. The hydrocarbon FEL cap is 0.40 for model years 
before 2011 for manufacturers choosing to certify to the 1.5 g/bhp-hr 
NOX + HC in 2004, as allowed in Sec.  86.005-10.
    (iii) Carbon monoxide. 14.4 grams per brake horsepower-hour (5.36 
grams per megajoule).
* * * * *
    (f) [Reserved]
    (g) Model year 2018 and later engines that will be installed in 
specialty vehicles as allowed by 40 CFR 1037.605 may meet alternate 
emission standards as follows:
    (1) The engines must be of a configuration that is identical to one 
that is certified under 40 CFR part 1048 to the Blue Sky standards 
under 40 CFR 1048.140.
    (2) Except as specified in this paragraph (g), engines certified 
under this paragraph (g) must meet all the requirements that apply 
under 40 CFR part 1048 instead of the comparable provisions in this 
subpart A. Before shipping engines under this section, you must have 
written assurance from the vehicle manufacturers that they need a 
certain number of exempted engines under this section. In your annual 
production report under 40 CFR 1048.250, count these engines separately 
and identify the vehicle manufacturers that will be installing them. 
Treat these engines as part of the corresponding engine family under 40 
CFR part 1048 for compliance purposes such as testing production 
engines, in-use testing, defect reporting, and recall.
    (3) The engines must be labeled as described in Sec.  86.095-35, 
with the following statement instead of the one specified in Sec.  
86.095-35(a)(3)(iii)(H): ``This engine conforms to alternate standards 
for specialty vehicles under 40 CFR 86.008-10(g)''. Engines certified 
under this paragraph (g) may not have the label specified for nonroad 
engines in 40 CFR part 1048 or any other label identifying them as 
nonroad engines.
    (4) In a separate application for a certificate of conformity, 
identify the corresponding nonroad engine family, describe the label 
required under this paragraph (g), state that you meet applicable 
diagnostic requirements under 40 CFR part 1048, and identify your 
projected U.S.-directed production volume.
    (5) No additional certification fee applies for engines certified 
under this paragraph (g).
    (6) Engines certified under this paragraph (g) may not generate or 
use emission credits under this part. The vehicles in which these 
engines are installed may generate or use emission credits as described 
in 40 CFR part 1037.
    (7) Engines may instead meet standards for heavy-duty highway 
engines in California, as demonstrated by an Executive Order issued by 
the California Air Resources Board.

0
34. Section 86.016-1 is amended by revising paragraphs (a)(1) and (2) 
to read as follows:


Sec.  86.016-1   General applicability.

    (a) * * *
    (1) The provisions of this subpart related to exhaust emission 
standards apply for diesel-cycle and Otto-cycle heavy-duty engines 
installed in vehicles above 14,000 pounds GVWR; however, these vehicles 
may instead be certified under subpart S of this part in certain 
circumstances as specified in Sec.  86.1801.
    (2) The provisions of this subpart related to exhaust emission 
standards apply for engines that will be installed in incomplete heavy-
duty vehicles at or below 14,000 pounds GVWR; however, these vehicles 
may instead be certified under subpart S of this part as specified in 
Sec.  86.1801.
* * * * *

0
35. Section 86.078-6 is revised to read as follows:

[[Page 73976]]

Sec.  86.078-6  Hearings on certification.

    If a manufacturer's request for a hearing is approved, EPA will 
follow the hearing procedures specified in 40 CFR part 1068, subpart G.

0
36. Section 86.084-4 is revised to read as follows:


Sec.  86.084-4  Section numbering; construction.

    (a) The model year of initial applicability is indicated by the 
last two digits of the 5-digit group. A section remains in effect for 
subsequent model years until it is superseded. The number following the 
hyphen designates what previous section is replaced by a future 
regulation. For example, Sec.  86.005-1 applies to model year 2005 and 
later vehicles and engines until it is superseded. Section 86.016-1 
takes effect with model year 2016 and continues to apply until it is 
superseded; Sec.  86.005-1 no longer applies starting with model year 
2016, except as specified by Sec.  86.016-1.
    (b) If a regulation in this subpart references a section that has 
been superseded or no longer exists, this should be understood as a 
reference to the same section for the appropriate model year. For 
example, if a regulation in this subpart refers to Sec.  86.001-30, it 
should be taken as a reference to Sec.  86.007-30 or any later version 
of that section that applies for the appropriate model year. However, 
this does not apply if the reference to a superseded section 
specifically states that the older provision applies instead of any 
updated provisions from the section in effect for the current model 
year; this occurs most often as part of the transition to new emission 
standards.
    (c) Except where indicated, the language in this subpart applies to 
both vehicles and engines. In many instances, language referring to 
engines is enclosed in parentheses and immediately follows the language 
discussing vehicles.


Sec.  86.085-37  [Amended]

0
37. Section 86.085-37 is amended by removing paragraph (d).

0
38. Section 86.094-14 is revised to read as follows:


Sec.  86.094-14   Small-volume manufacturer certification procedures.

    (a)(1) The small-volume manufacturer certification procedures 
described in paragraphs (b) and (c) of this section are optional. 
Small-volume manufacturers may use these optional procedures to 
demonstrate compliance with the general standards and specific emission 
requirements contained in this subpart.
    (2) To satisfy the durability data requirements of the small-volume 
manufacturer certification procedures, manufacturers of vehicles (or 
engines) as described in paragraph (b) of this section may use assigned 
deterioration factors that the Administrator determines by methods 
described in paragraph (c)(3)(ii) of this section. However, if no 
deterioration factor data (either the manufacturer's or industry-wide 
deterioration factor data) are available from previously completed 
durability data vehicles or engines used for certification, 
manufacturers of vehicles (or engines) as described in paragraph (b) of 
this section or with new technology not previously certified may use 
assigned deterioration factors that the Administrator determines by 
alternative methods, based on good engineering judgment. The factors 
that the Administrator determines by alternative methods will be 
published in an advisory letter or advisory circular.
    (b)(1) The optional small-volume manufacturer certification 
procedures apply to heavy-duty vehicles, and heavy-duty engines 
produced by manufacturers with U.S. sales, including all vehicles and 
engines imported under the provisions of Sec. Sec.  85.1505 and 85.1509 
of this chapter (for the model year in which certification is sought) 
of fewer than 10,000 units (Light-Duty Vehicles, Light-Duty Trucks, 
Heavy-Duty Vehicles and Heavy-Duty Engines combined).
    (2) For the purpose of determining the applicability of paragraph 
(b)(1) of this section, the sales the Administrator shall use shall be 
the aggregate of the projected or actual sales of those vehicles and/or 
engines in any of these groupings:
    (i) Vehicles and/or engines produced by two or more firms, one of 
which is 10 percent or greater part owned by another;
    (ii) Vehicles and/or engines produced by any two or more firms if a 
third party has equity ownership of 10 percent or more in each of the 
firms;
    (iii) Vehicles and/or engines produced by two or more firms having 
a common corporate officer(s) who is (are) responsible for the overall 
direction of the companies;
    (iv) Vehicles and/or engines imported or distributed by all firms 
where the vehicles and/or engines are manufactured by the same entity 
and the importer or distributor is an authorized agent of the entity.
    (3) If the aggregated sales, as determined in paragraph (b)(2) of 
this section are less than 301 units, the manufacturers in the 
aggregated relationship may certify under the provisions in this 
section that apply to manufacturers with sales of less than 301 units.
    (4) If the aggregated sales, as determined in paragraph (b)(2) of 
this section are greater than 300 but fewer than 10,000 units, the 
manufacturers in the aggregated relationship may certify under the 
provisions in this section that apply to manufacturers with sales from 
and including 301 through 9,999 motor vehicles and motor vehicles 
engines per year.
    (5) If the aggregated sales, as determined in paragraph (b)(2) of 
this section are equal to or greater than 10,000 units, then the 
manufacturers involved in the aggregated relationship will be allowed 
to certify a number of units under the small-volume engine family 
certification procedures (reference Sec.  86.001-24(e)) in accordance 
with the following criteria:
    (i) If a manufacturer purchases less than 50 percent of another 
manufacturer, each manufacturer retains its right to certify 9,999 
units using the small-volume engine family certification procedures.
    (ii) If a manufacturer purchases 50 percent or more of another 
manufacturer, the manufacturer with the over 50 percent interest must 
share, with the manufacturer it purchased, its 9,999 units under the 
small-volume engine family certification procedures.
    (iii) In a joint venture arrangement (50/50 ownership) between two 
manufacturers, each manufacturer retains its eligibility for 9,999 
units under the small-volume engine family certification procedures, 
but the joint venture must draw its maximum 9,999 units from the units 
allocated to its parent manufacturers.
    (c) All the provisions of this subpart apply to small-volume 
manufacturers, except as described in this paragraph (c). The 
appropriate model year of specific sections shall be determined in 
accordance with Sec.  86.084-4.
    (1) Section 86.080-12 is not applicable.
    (2) Small-volume manufacturers shall include in their records all 
the information that EPA requires in Sec.  86.007-21. This information 
will be considered part of the manufacturer's application for 
certification. However, the manufacturer is not required to submit the 
information to the Administrator unless the Administrator requests it.
    (3) Small-volume manufacturers may satisfy the requirements of 
Sec.  86.001-24(b) and (c) as follows:
    (i) Emission data. Small-volume manufacturers may select one 
emission data test vehicle (engine) per engine

[[Page 73977]]

family by the worst-case emissions criteria as follows:
    (A) Heavy-duty Otto-cycle engines. The manufacturer shall select 
one emission data engine first based on the largest displacement within 
the engine family. Then within the largest displacement the 
manufacturer shall select, in the order listed, highest fuel flow at 
the speed of maximum rated torque, the engine with the most advanced 
spark timing, no EGR or lowest EGR flow, and no air pump or lowest 
actual flow air pump.
    (B) Heavy-duty diesel engines. The manufacturer shall select one 
emission data engine based on the highest fuel feed per stroke, 
primarily at the speed of maximum rated torque and secondarily at rated 
speed.
    (ii) Durability data. Small-volume manufacturers may satisfy the 
durability data requirements with the following procedures:
    (A) Manufacturers with aggregated sales of less than 301 motor 
vehicles and motor vehicle engines per year may use assigned 
deterioration factors that the Administrator determines and prescribes. 
The factors will be the Administrator's estimate, periodically updated 
and published in an advisory letter or advisory circular, of the 70th 
percentile deterioration factors calculated using the industry-wide 
data base of previously completed durability data vehicles or engines 
used for certification. However, the manufacturer may, at its option, 
accumulate miles (hours) on a durability data vehicle (engine) and 
complete emission tests for the purpose of establishing its own 
deterioration factors.
    (B)(1) Manufacturers with aggregated sales from and including 301 
through 9,999 motor vehicles and motor vehicle engines per year 
certifying light-duty vehicle exhaust emissions from vehicles equipped 
with proven emission control systems shall use assigned deterioration 
factors that the manufacturer determines based on its good engineering 
judgment. However, the manufacturer may not use deterioration factors 
less than either the average or 70th percentile of all of that 
manufacturer's deterioration factor data, whichever is less. These 
minimum deterioration factors shall be calculated according to 
procedures in paragraph (c)(3)(ii)(B)(2), of this section. If the 
manufacturer does not have at least two data points to calculate these 
manufacturer specific average deterioration factors, then the 
deterioration factors shall be no less than the EPA supplied industry-
wide deterioration factors. However, the manufacturer may, at its 
option, accumulate miles on a durability data vehicle and complete 
emission tests for the purpose of establishing its own deterioration 
factors.
    (2) The manufacturer's minimum deterioration factors shall be 
calculated using the deterioration factors from all engine families, 
within the same vehicle/engine-fuel usage category (e.g., gasoline-
fueled light-duty vehicle, etc.) previously certified to the same 
emission standards. The manufacturer shall use only deterioration 
factors from engine families previously certified by the manufacturer 
and the deterioration factors shall not be included in the calculation 
more than once. The deterioration factors for each pollutant shall be 
calculated separately. The manufacturer may, at its option, limit the 
deterioration factors used in the calculation of the manufacturer's 
minimum deterioration factors to those from all similar systems to the 
system being certified if sufficient data (i.e., from at least two 
certified systems) exists. All data eligible to be grouped as similar 
system data shall be used in calculating similar system deterioration 
factors. Any deterioration factors used in calculating similar system 
deterioration factors shall not be included in calculating the 
manufacturer's minimum deterioration factors used to certify any of the 
manufacturer's remaining vehicle systems.
    (C) Manufacturers with aggregated sales from 301 through 9,999 
motor vehicles and motor vehicle engines and certifying light-duty 
vehicle exhaust emissions from vehicles equipped with unproven emission 
control systems shall use deterioration factors that the manufacturer 
determines from official certification durability data generated by 
vehicles from engine families representing a minimum of 25 percent of 
the manufacturer's sales equipped with unproven emission control 
systems. The sales projections are to be based on total sales projected 
for each engine/system combination. The durability programs applicable 
to such manufacturers for this purpose shall be the Standard AMA, the 
Production AMA and the Alternative Service Accumulation Durability 
Programs of Sec.  86.094-13. The durability data vehicle (engine) 
mileage accumulation and emission tests are to be conducted in 
accordance with Sec.  86.094-13. The manufacturer must develop 
deterioration factors by generating durability data in accordance with 
Sec.  86.094-13 on a minimum of 25 percent of the manufacturer's 
projected sales (by engine/system combination) that is equipped with 
unproven emission control systems. The manufacturer must complete the 
25 percent durability requirement before the remainder of the 
manufacturer's sales equipped with unproven emission control systems is 
certified using manufacturer-determined assigned deterioration factors. 
Alternatively, any of these manufacturers may, at their option, 
accumulate miles on durability data vehicles and complete emission 
tests for the purpose of establishing their own deterioration factors 
on the remaining sales.
    (4) Section 86.001-24(d) and (e) are not applicable.
    (5) Small-volume manufacturers shall comply with the following 
provisions instead of Sec.  86.007-30(a)(2) and (b):
    (i) Small-volume manufacturers shall submit an application for 
certification containing the following elements:
    (A) The names, addresses, and telephone numbers of the persons the 
manufacturer authorizes to communicate with us.
    (B) A brief description of the vehicles (or engines) covered by the 
certificate (the manufacturers' sales data book or advertising, 
including specifications, may satisfy this requirement for most 
manufacturers). The description shall include, as a minimum, the 
following items:
    (1) Engine evaporative/refueling family names and vehicle (or 
engine) configurations.
    (2) Vehicle carlines or engine models to be listed on the 
certificate of conformity.
    (3) The test weight and horsepower setting for each vehicle or 
engine configuration.
    (4) Projected sales.
    (5) Combustion cycle.
    (6) Cooling mechanism.
    (7) Number of cylinders.
    (8) Displacement.
    (9) Fuel system type.
    (10) Number of catalytic converters, type, volume, composition, 
surface area, and total precious metal loading.
    (11) Method of air aspiration.
    (12) Thermal reactor characteristics.
    (13) Suppliers' and/or manufacturers' name and model number of any 
emission related items of the above, if purchased from a supplier who 
uses the items in its own certified vehicle(s) or engine(s).
    (14) A list of emission component part numbers.
    (15) Drawings, calibration curves, and descriptions of emission 
related components, including those components regulated under Sec.  
86.001-22(e), and schematics of hoses and other devices connecting 
these components.
    (16)-(17) [Reserved]
    (18) Proof that the manufacturer has obtained or entered an 
agreement to

[[Page 73978]]

purchase, when applicable, the insurance policy required by the Sec.  
85.1510(b) of this chapter. The manufacturer may submit a copy of the 
insurance policy or purchase agreement as proof that the manufacturer 
has obtained or entered an agreement to purchase the insurance policy.
    (19) For each evaporative/refueling emission family, a description 
of any unique procedures required to perform evaporative and/or 
refueling emission tests (as applicable) (including canister working 
capacity, canister bed volume, and fuel temperature profile for the 
running loss test) for all vehicles in that evaporative/refueling 
emission family, and a description of the method used to develop those 
unique procedures.
    (20) For each evaporative/refueling emission family:
    (i) Canister working capacity, according to the procedures 
specified in Sec.  86.132-96(h)(1)(iv);
    (ii) Canister bed volume; and
    (iii) Fuel temperature profile for the running loss test, according 
to the procedures specified in Sec.  86.129-94(d).
    (C) The results of all emission tests the manufacturer performs to 
demonstrate compliance with the applicable standards.
    (D)(1) The following statement signed by the authorized 
representative of the manufacturer: ``The vehicles (or engines) 
described herein have been tested in accordance with (list of the 
applicable subparts A, B, I, N, or P) of part 86, title 40, Code of 
Federal Regulations, and on the basis of those tests are in conformance 
with that subpart. All the data and records required by that subpart 
are on file and are available for inspection by the EPA Administrator. 
We project the total U.S. sales of vehicles (engines) subject to this 
subpart (including all vehicles and engines imported under the 
provisions of 40 CFR 85.1505 and 40 CFR 85.1509) to be fewer than 
10,000 units.''
    (2) [Reserved]
    (3) A statement that the vehicles or engines described in the 
manufacturer's application for certification are not equipped with 
auxiliary emission control devices which can be classified as a defeat 
device as defined in Sec.  86.004-2.
    (4) A statement of compliance with section 206(a)(3) of the Clean 
Air Act (42 U.S.C. 7525(a)(3)).
    (5)-(6) [Reserved]
    (7) A statement affirming that the manufacturer will provide a list 
of emission and emission-related service parts, including part number 
designations and sources of parts, to the vehicle purchaser for all 
emission and emission-related parts which might affect vehicle emission 
performance throughout the useful life of the vehicle. Secondly, it 
must state that qualified service facilities and emission-related 
repair parts will be conveniently available to serve its vehicles. In 
addition, if service facilities are not available at the point of sale 
or distribution, the manufacturer must indicate that the vehicle 
purchaser will be provided information identifying the closest 
authorized service facility to the point of sale, if in the United 
States, or the closest authorized service facility to the point of 
distribution to the ultimate purchaser if the vehicle was purchased 
outside of the United States by the ultimate purchaser. Such 
information should also be made available to the Administrator upon 
request.
    (E) Manufacturers utilizing deterioration factors determined by the 
manufacturer based on its good engineering judgment (reference 
paragraph (c)(3)(ii)(B) of this section) shall provide a description of 
the method(s) used by the manufacturer to determine the deterioration 
factors.
    (ii) If the manufacturer meets the requirements of this subpart, 
the Administrator will issue a certificate of conformity for the 
vehicles or engines described in the application for certification.
    (iii) The certificate will be issued for such a period not to 
exceed one model year as the Administrator may determine and upon such 
terms as he may deem necessary to assure that any vehicle or engine 
covered by the certificate will meet the requirements of the Act and of 
this subpart.
    (iv) If, after a review of the statements and descriptions 
submitted by the manufacturer, the Administrator determines that the 
manufacturer has not met the applicable requirements, the Administrator 
shall notify the manufacturer in writing of his intention to deny 
certification, setting forth the basis for his determination. The 
manufacturer may request a hearing on the Administrator's 
determination. If the manufacturer does not request a hearing or 
present the required information, the Administrator will deny 
certification.
    (6) Sections 86.079-31 and 86.079-32 are not applicable.
    (7) The following provisions apply for small-volume manufacturers 
instead of the provisions specified in Sec.  86.079-33:
    (i) Small-volume manufacturers may make production changes (running 
changes) without receiving the Administrator's prior approval. The 
manufacturer shall assure (by conducting emission tests as it deems 
necessary) that the affected vehicles (engines) remain in compliance 
with the requirements of this part.
    (ii) The manufacturer shall notify the Administrator within seven 
days after implementing any production related change (running change) 
that would affect vehicle emissions. This notification shall include 
any changes to the information required under paragraph (c)(5)(i) of 
this section. The manufacturer shall also amend as necessary its 
records required under paragraph (c)(2) of this section to confirm the 
production design change.
    (8) Section 86.082-34 is not applicable.

0
39. Section 86.094-25 is amended by revising paragraphs (b)(2) and 
(b)(7)(iii) to read as follows:


Sec.  86.094-25   Maintenance.

* * * * *
    (b) * * *
    (2) Any emission-related maintenance which is performed on 
vehicles, engines, subsystems, or components must be technologically 
necessary to assure in-use compliance with the emission standards. The 
manufacturer must submit data which demonstrate to the Administrator 
that all of the emission-related scheduled maintenance which is to be 
performed is technologically necessary. Scheduled maintenance must be 
approved by the Administrator prior to being performed or being 
included in the maintenance instructions provided to purchasers under 
Sec.  86.010-38.
* * * * *
    (7) * * *
    (iii) Any manufacturer may request a hearing on the Administrator's 
determinations in this paragraph (b)(7). The request shall be in 
writing and shall include a statement specifying the manufacturer's 
objections to the Administrator's determinations, and data in support 
of such objections. If, after review of the request and supporting 
data, the Administrator finds that the request raises a substantial 
factual issue, he shall provide the manufacturer a hearing as described 
in 40 CFR part 1068, subpart G.
* * * * *


Sec. Sec.  86.094-30 and 86.095-14  [Removed]

0
40. Remove Sec. Sec.  86.094-30 and 86.095-14.

0
41. Section 86.095-35 is amended by:
0
a. Revising paragraphs (a) introductory text, (a)(3)(iii)(B), (H), (I), 
(J), and (K);
0
b. Adding paragraph (c); and
0
c. Revising paragraph (i).
    The revisions and addition read as follows:

[[Page 73979]]

Sec.  86.095-35  Labeling.

    (a) The manufacturer of any motor vehicle (or motor vehicle engine) 
subject to the applicable emission standards (and family emission 
limits, as appropriate) of this subpart, shall, at the time of 
manufacture, affix a permanent legible label, of the type and in the 
manner described below, containing the information hereinafter 
provided, to all production models of such vehicles (or engines) 
available for sale to the public and covered by a Certificate of 
Conformity under Sec.  86.007-30(a).
* * * * *
    (3) * * *
    (iii) * * *
    (B) The full corporate name and trademark of the manufacturer; 
though the label may identify another company and use its trademark 
instead of the manufacturer's as long as the manufacturer complies with 
the branding provisions of 40 CFR 1068.45.
* * * * *
    (H) The prominent statement: ``This engine conforms to U.S. EPA 
regulations applicable to XXXX Model Year New Heavy-Duty Engines.'';
    (I) If the manufacturer has an alternate useful life period under 
the provisions of Sec.  86.094-21(f), the prominent statement: ``This 
engine has been certified to meet U.S. EPA standards for a useful-life 
period of XXX miles or XXX hours of operation, whichever occurs first. 
This engine's actual life may vary depending on its service 
application.'' The manufacturer may alter this statement only to 
express the assigned alternate useful life in terms other than miles or 
hours (e.g., years, or hours only);
    (J) For diesel engines, the prominent statement: ``This engine has 
a primary intended service application as a XXX heavy-duty engine.'' 
(The primary intended service applications are light, medium, and 
heavy, as defined in Sec.  86.090-2.);
    (K) For engines certified under the alternative standards specified 
in Sec.  86.007-11(g) or Sec.  86.008-10(g), the following statement: 
``This engine is certified for only in specialty vehicles as specified 
in [40 CFR 86.007-11 or 40 CFR 86.008-10]'';
* * * * *
    (c) Vehicles powered by model year 2007 through 2013 diesel-fueled 
engines must include permanent, readily visible labels on the dashboard 
(or instrument panel) and near all fuel inlets that state ``Use Ultra 
Low Sulfur Diesel Fuel Only''; or ``Ultra Low Sulfur Diesel Fuel 
Only''.
* * * * *
    (i) The Administrator may approve in advance other label content 
and formats, provided the alternative label contains information 
consistent with this section.


Sec.  86.098-14  [Removed]

0
42. Remove Sec.  86.098-14.

Subpart B--Emission Regulations for 1977 and Later Model Year New 
Light-Duty Vehicles and New Light-Duty Trucks and New Otto-Cycle 
Complete Heavy-Duty Vehicles; Test Procedures

0
43. Section 86.143-96 is amended by revising the equation in paragraph 
(b)(1)(i) to read as follows:


Sec.  86.143-96  Calculations; evaporative emissions.

* * * * *
    (b) * * *
    (1) * * *
    (i) * * *
    [GRAPHIC] [TIFF OMITTED] TR25OC16.309
    
* * * * *

Subpart E--Emission Regulations for 1978 and Later New Motorcycles, 
General Provisions

0
44. Section 86.402-78 is amended by adding, in alphabetical order, a 
definition for ``Round'' to paragraph (a) to read as follows:


Sec.  86.402-78  Definitions.

    (a) * * *
    Round has the meaning given in 40 CFR 1065.1001, unless otherwise 
specified.
* * * * *

0
45. Section 86.410-2006 is amended by revising paragraph (e) 
introductory text to read as follows:


Sec.  86.410-2006  Emission standards for 2006 and later model year 
motorcycles.

* * * * *
    (e) Manufacturers with fewer than 500 employees worldwide and 
producing fewer than 3,000 motorcycles per year for the United States 
are considered small-volume manufacturers for the purposes of this 
section. The following provisions apply for these small-volume 
manufacturers:
* * * * *


Sec.  86.419-78  [Removed]

0
46. Section 86.419-78 is removed.

0
47. Section 86.419-2006 is amended by revising paragraph (a)(1) to read 
as follows:


Sec.  86.419-2006  Engine displacement, motorcycle classes.

    (a)(1) Engine displacement shall be calculated using nominal engine 
values and rounded to the nearest whole cubic centimeter.
* * * * *

0
48. Section 86.432-78 is amended by revising paragraph (d) to read as 
follows:


Sec.  86.432-78  Deterioration factor.

* * * * *
    (d) An exhaust emission deterioration factor will be calculated by 
dividing the predicted emissions at the useful life distance by the 
predicted emissions at the total test distance. Predicted emissions are 
obtained from the correlation developed in paragraph (c) of this 
section. Factor = Predicted total distance emissions / Predicted total 
test distance emissions.
    These interpolated and extrapolated values shall be carried out to 
four places to the right of the decimal point before dividing one by 
the other to determine the deterioration factor. The results shall be 
rounded to three places to the right of the decimal point.
* * * * *

0
49. Section 86.443-78 is revised to read as follows:


Sec.  86.443-78  Request for hearing.

    The manufacturer may request a hearing on the Administrator's 
determination as described in 40 CFR part 1068, subpart G.

0
50. Section 86.444-78 is revised to read as follows:


Sec.  86.444-78  Hearings on certification.

    If a manufacturer's request for a hearing is approved, EPA will 
follow the hearing procedures specified in 40 CFR part 1068, subpart G.

[[Page 73980]]

Subpart F--Emission Regulations for 1978 and Later New Motorcycles; 
Test Procedures

0
51. Section 86.544-90 is amended by revising the introductory text and 
paragraph (a) to read as follows:


Sec.  86.544-90  Calculations; exhaust emissions.

    This section describes how to calculate exhaust emissions. 
Determine emission results for each pollutant to at least one more 
decimal place than the applicable standard. Apply the deterioration 
factor, then round the adjusted figure to the same number of decimal 
places as the emission standard. Compare the rounded emission levels to 
the emission standard for each emission data vehicle. In the case of 
NOX + HC standards, apply the deterioration factor to each 
pollutant and then add the results before rounding.
    (a) Calculate a composite FTP emission result using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.039

Where:

Ywm = Weighted mass emissions of each pollutant (i.e., 
CO2, HC, CO, or NOX) in grams per vehicle 
kilometer and if appropriate, the weighted carbon mass equivalent of 
total hydrocarbon equivalent, in grams per vehicle kilometer.
Yct = Mass emissions as calculated from the transient 
phase of the cold-start test, in grams per test phase.
Ys = Mass emissions as calculated from the stabilized 
phase of the cold-start test, in grams per test phase.
Dct = The measured driving distance from the transient 
phase of the cold-start test, in kilometers.
Ds = The measured driving distance from the stabilized 
phase of the cold-start test, in kilometers.
Yht = Mass emissions as calculated from the transient 
phase of the hot-start test, in grams per test phase.
Dht = The measured driving distance from the transient 
phase of the hot-start test, in kilometers.
* * * * *

Subpart G--Selective Enforcement Auditing of New Light-Duty 
Vehicles, Light-Duty Trucks, and Heavy-Duty Vehicles

0
52. Section 86.614-84 is revised to read as follows:


Sec.  86.614-84  Hearings on suspension, revocation, and voiding of 
certificates of conformity.

    The provisions of 40 CFR part 1068, subpart G, apply if a 
manufacturer requests a hearing regarding suspension, revocation or 
voiding of certificates of conformity.

0
53. Section 86.615-84 is revised to read as follows:


Sec.  86.615-84  Treatment of confidential information.

    The provisions of 40 CFR 1068.10 apply for information you consider 
confidential.

Subpart L--Nonconformance Penalties for Gasoline-Fueled and Diesel 
Heavy-Duty Engines and Heavy-Duty Vehicles, Including Light-Duty 
Trucks


Sec.  86.1103-87  [Removed]

0
54. Section 86.1103-87 is removed.

0
55. Section 86.1103-2016 is added to subpart L to read as follows:


Sec.  86.1103-2016  Criteria for availability of nonconformance 
penalties.

    (a) General. This section describes the three criteria EPA will use 
to use to evaluate whether NCPs are appropriate under the Clean Air Act 
for a given pollutant and a given subclass of heavy-duty engines and 
heavy-duty vehicles. Together, these criteria evaluate the likelihood 
that a manufacturer will be technologically unable to meet a standard 
on time. Note that since the first two of these criteria are intended 
to address the question of whether a given standard creates the 
possibility for this to occur, they are evaluated before the third 
criterion that addresses the likelihood that the possibility will 
actually happen.
    (b) Criteria. We will establish NCPs for a given pollutant and 
subclass when we find that each of the following criteria is met:

    (1) There is a new or revised emission standard is more 
stringent than the previous standard for the pollutant, or an 
existing standard for that pollutant has become more difficult to 
achieve because of a new or revised standard. When evaluating this 
criterion, EPA will consider a new or revised standard to be ``new'' 
or ``revised'' until the point at which all manufacturers already 
producing U.S.-directed engines or vehicles within the subclass have 
achieved full compliance with the standard. For purposes of this 
criterion, EPA will generally not consider compliance using banked 
emission credits to be ``full compliance''.
    (2) Substantial work is required to meet the standard for which 
the NCP is offered, as evaluated from the point at which the 
standard was adopted or revised (or the point at which the standard 
became more difficult meet because another standard was adopted or 
revised). Substantial work, as used in this paragraph (b)(2), means 
the application of technology not previously used in an engine or 
vehicle class or subclass, or the significant modification of 
existing technology or design parameters, needed to bring the 
vehicle or engine into compliance with either the more stringent new 
or revised standard or an existing standard which becomes more 
difficult to achieve because of a new or revised standard. Note that 
where this criterion is evaluated after any of the work has been 
completed, the criterion would be interpreted as whether or not 
substantial work was required to meet the standard.
    (3) There is or is likely to be a technological laggard for the 
subclass. Note that a technological laggard is a manufacturer that 
is unable to meet the standard for one or more products within the 
subclass for technological reasons.
    (c) Evaluation. (1) We will generally evaluate these criteria in 
sequence. Where we find that the first criterion has not been met, 
we will not consider the other two criteria. Where we find that the 
first criterion has been met but not the second, we will not 
consider the third criterion. We may announce our findings 
separately or simultaneously.
    (2) We may consider any available information in making our 
findings.
    (3) Where we are uncertain whether the first and/or second 
criteria have been met, we may presume that they have been met and 
make our decision based solely on whether or not the third criterion 
has been met.
    (4) Where we find that a manufacturer will fail to meet a 
standard but are uncertain whether the failure is a technological 
failure, we may presume that the manufacturer is a technological 
laggard.


Sec.  86.1104-91   [Removed]

0
56. Section 86.1104-91 is removed.

0
57. Section 86.1104-2016 is added to subpart L to read as follows:


Sec.  86.1104-2016  Determination of upper limits.

    EPA shall set a separate upper limit for each phase of NCPs and for 
each service class.
    (a) Except as provided in paragraphs (b), (c) and (d) of this 
section, the upper limit shall be set as follows:
    (1) The upper limit applicable to a pollutant emission standard for 
a subclass of heavy-duty engines or heavy-duty vehicles for which an 
NCP is established in accordance with Sec.  86.1103-87, shall be the 
previous pollutant emission standard for that subclass.
    (2) If a manufacturer participates in any of the emissions 
averaging, trading, or banking programs, and carries over certification 
of an engine family from the prior model year, the upper limit for that 
engine family shall be the family emission limit of the prior model 
year, unless the family emission limit is less than the upper limit 
determined in paragraph (a)(1) of this section.

[[Page 73981]]

    (b) If no previous standard existed for the pollutant under 
paragraph (a) of this section, the upper limit will be developed by EPA 
during rulemaking.
    (c) EPA may set the upper limit during rulemaking at a level below 
the level specified in paragraph (a) of this section if we determine 
that a lower level is achievable by all engines or vehicles in that 
subclass.
    (d) EPA may set the upper limit at a level above the level 
specified in paragraph (a) of this section if we determine that such 
level will not be achievable by all engines or vehicles in that 
subclass.

0
58. Section 86.1105-87 is amended by revising paragraph (e) and 
removing paragraph (j).
    The revision reads as follows:


Sec.  86.1105-87  Emission standards for which nonconformance penalties 
are available.

* * * * *
    (e) The values of COC50, COC90, and 
MC50 in paragraphs (a) and (b) of this section are expressed 
in December 1984 dollars. The values of COC50, 
COC90, and MC50 in paragraphs (c) and (d) of this 
section are expressed in December 1989 dollars. The values of 
COC50, COC90, and MC50 in paragraph 
(f) of this section are expressed in December 1991 dollars. The values 
of COC50, COC90, and MC50 in 
paragraphs (g) and (h) of this section are expressed in December 1994 
dollars. The values of COC50, COC90, and 
MC50 in paragraph (i) of this section are expressed in 
December 2001 dollars. These values shall be adjusted for inflation to 
dollars as of January of the calendar year preceding the model year in 
which the NCP is first available by using the change in the overall 
Consumer Price Index, and rounded to the nearest whole dollar.
* * * * *

0
59. Section 86.1112-87 is amended by revising paragraphs (a)(2)(iii), 
(a)(3)(iii), (d) and (e)(2) to read as follows:


Sec.  86.1112-87  Determining the compliance level and reporting of 
test results.

    (a) * * *
    (2) * * *
    (iii) The compliance level for the pollutant is the result of the 
following equation, using the test results obtained in paragraph 
(a)(2)(ii) of this section and all SEA test results for that pollutant 
if the PCA follows an SEA failure:

CL = X + Ks

Where:

CL = The compliance level.
X= The mean of the final deteriorated test results, as defined by 
paragraph (e) of this section.
K = A value that depends on the size of the test sample. See table 2 
of appendix XII of this part for the value of K that corresponds to 
the size of the test sample.
s = The sample standard deviation.
Round the compliance level to the same number of significant figures 
contained in the applicable standard.

    (3) * * *
    (iii) The compliance level for the pollutant is the result of the 
following equation, using the test results obtained in (a)(3)(ii) and 
all SEA test results for that pollutant if the PCA follows an SEA 
failure:

CL = X + Ks

Where:

CL = The compliance level.
X = The mean of the final deteriorated test results, as defined by 
paragraph (e) of this section.
K = A value that depends on the size of the test sample. See table 3 
of appendix XII of this part for the value of K that corresponds to 
the size of the test sample.
s = The sample standard deviation.
    Round the compliance level to the same number of significant 
figures contained in the applicable standard.
* * * * *
    (d) Final test results are calculated by summing the initial test 
results derived in paragraph (c) of this section for each test engine 
or vehicle, dividing by the number of tests conducted on the engine or 
vehicle, and rounding to the same number of decimal places contained in 
the applicable standard expressed to one additional significant figure.
    (e) * * *
    (2) Round the final deteriorated test results to the same number of 
significant figures contained in the applicable standard.
* * * * *

0
60. Section 86.1113-87 is amended by revising paragraphs (a)(6), (f) 
and (g)(3) introductory text to read as follows:


Sec.  86.1113-87  Calculation and payment of penalty.

    (a) * * *
    (6) In calculating the NCP, appropriate values of the following 
predefined terms should be used: CL, S, UL, F, and Ai. For 
all other terms, unrounded values of at least five figures beyond the 
decimal point should be used in calculations leading up to the penalty 
amount. Any NCP calculated under paragraph (a) of this section will be 
rounded to the nearest dollar.
* * * * *
    (f) A manufacturer may request a hearing under 40 CFR part 1068, 
subpart G, as to whether the compliance level (including a compliance 
level in excess of the upper limit) was determined properly.
    (g) * * *
    (3) A manufacturer making payment under paragraph (g)(1) or (2) of 
this section shall submit the following information by each quarterly 
due date to the Designated Compliance Officer (see 40 CFR 1036.801). 
This information shall be submitted even if a manufacturer has no NCP 
production in a given quarter.
* * * * *

0
61. Section 86.1115-87 is revised to read as follows:


Sec.  86.1115-87  Hearing procedures for nonconformance determinations 
and penalties.

    The provisions of 40 CFR part 1068, subpart G, apply if a 
manufacturer requests a hearing regarding penalties under this subpart.

Subpart N--Exhaust Test Procedures for Heavy-Duty Engines

0
62. Section 86.1301 is revised to read as follows:


Sec.  86.1301   Scope; applicability.

    This subpart specifies gaseous emission test procedures for Otto-
cycle and diesel heavy-duty engines, and particulate emission test 
procedures for diesel heavy-duty engines.

0
63. Section 86.1362 is amended by revising paragraph (a) to read as 
follows:


Sec.  86.1362  Steady-state testing with a ramped-modal cycle.

* * * * *
    (a) Measure emissions by testing the engine on a dynamometer with 
the following ramped-modal duty cycle to determine whether it meets the 
applicable steady-state emission standards:

----------------------------------------------------------------------------------------------------------------
                                  Time  in mode                            Torque (percent) 2 3   CO2  weighting
            RMC mode                (seconds)      Engine speed \1\ \2\                            (percent) \4\
----------------------------------------------------------------------------------------------------------------
1a Steady-state................             170  Warm Idle..............  0.....................               6
1b Transition..................              20  Linear Transition......  Linear Transition.....

[[Page 73982]]

 
2a Steady-state................             173  A......................  100...................               9
2b Transition..................              20  Linear Transition......  Linear Transition.....
3a Steady-state................             219  B......................  50....................              10
3b Transition..................              20  B......................  Linear Transition.....
4a Steady-state................             217  B......................  75....................              10
4b Transition..................              20  Linear Transition......  Linear Transition.....
5a Steady-state................             103  A......................  50....................              12
5b Transition..................              20  A......................  Linear Transition.....
6a Steady-state................             100  A......................  75....................              12
6b Transition..................              20  A......................  Linear Transition.....
7a Steady-state................             103  A......................  25....................              12
7b Transition..................              20  Linear Transition......  Linear Transition.....
8a Steady-state................             194  B......................  100...................               9
8b Transition..................              20  B......................  Linear Transition.....
9a Steady-state................             218  B......................  25....................               9
9b Transition..................              20  Linear Transition......  Linear Transition.....
10a Steady-state...............             171  C......................  100...................               2
10b Transition.................              20  C......................  Linear Transition.....
11a Steady-state...............             102  C......................  25....................               1
11b Transition.................              20  C......................  Linear Transition.....
12a Steady-state...............             100  C......................  75....................               1
12b Transition.................              20  C......................  Linear Transition.....
13a Steady-state...............             102  C......................  50....................               1
13b Transition.................              20  Linear Transition......  Linear Transition.....
14 Steady-state................             168  Warm Idle..............  0.....................               6
----------------------------------------------------------------------------------------------------------------
\1\ Speed terms are defined in 40 CFR part 1065.
\2\ Advance from one mode to the next within a 20-second transition phase. During the transition phase, command
  a linear progression from the speed or torque setting of the current mode to the speed or torque setting of
  the next mode.
\3\ The percent torque is relative to maximum torque at the commanded engine speed.
\4\ Use the specified weighting factors to calculate composite emission results for CO2 as specified in 40 CFR
  1036.501.

* * * * *

0
64. Section 86.1370 is amended by revising paragraphs (g) and (h) and 
adding paragraphs (i) and (j) to read as follows:


Sec.  86.1370  Not-To-Exceed test procedures.

* * * * *
    (g) You may exclude emission data based on catalytic aftertreatment 
temperatures as follows:
    (1) For an engine equipped with a catalytic NOX 
aftertreatment system, exclude NOX emission data that is 
collected when the exhaust temperature at any time during the NTE event 
is less than 250 [deg]C.
    (2) For an engine equipped with an oxidizing catalytic 
aftertreatment system, exclude NMHC and CO emission data that is 
collected if the exhaust temperature is less than 250 [deg]C at any 
time during the NTE event.
    (3) Using good engineering judgment, measure exhaust temperature 
within 30 cm downstream of the last applicable catalytic aftertreatment 
device. Where there are parallel paths, use good engineering judgment 
to measure the temperature within 30 cm downstream of the last 
applicable catalytic aftertreatment device in the path with the 
greatest exhaust flow.
    (h) Any emission measurements corresponding to engine operating 
conditions that do not qualify as a valid NTE sampling event may be 
excluded from the determination of the vehicle-pass ratio specified in 
Sec.  86.1912 for the specific pollutant.
    (i) Start emission sampling at the beginning of each valid NTE 
sampling event, except as needed to allow for zeroing or conditioning 
the PEMS. For gaseous emissions, PEMS preparation must be complete for 
all analyzers before starting emission sampling.
    (j) Emergency vehicle AECDs. If your engine family includes engines 
with one or more approved AECDs for emergency vehicle applications 
under paragraph (4) of the definition of ``defeat device'' in Sec.  
86.1803, the NTE emission limits do not apply when any of these AECDs 
are active.

Subpart S--General Compliance Provisions for Control of Air 
Pollution From New and In-Use Light-Duty Vehicles, Light-Duty 
Trucks, and Heavy-Duty Vehicles

0
65. Section 86.1801-12 is amended as follows:
0
a. By removing and reserving paragraph (a)(2)(ii).
0
b. By revising paragraph (a)(3)(i).
0
c. By redesignating paragraphs (a)(3)(ii) through (iv) as paragraphs 
(a)(3)(iii) through (v), respectively.
0
d. By adding a new paragraph (a)(3)(ii).
    The revision and addition read as follows:


Sec.  86.1801-12  Applicability.

    (a) * * *
    (3) * * *
    (i) Heavy duty vehicles above 14,000 pounds GVWR may be optionally 
certified to the exhaust emission standards in this subpart, including 
the greenhouse gas emission standards, if they are properly included in 
test group with similar vehicles at or below 14,000 pounds GVWR. 
Emission standards apply to these vehicles as if they were Class 3 
heavy-duty vehicles. The work factor for these vehicles may not be 
greater than the largest work factor that applies for vehicles in the 
test group that are at or below 14,000 pounds GVWR (see Sec.  86.1819-
14).
    (ii) Incomplete heavy-duty vehicles at or below 14,000 pounds GVWR 
may be optionally certified to the exhaust emission standards in this 
subpart that apply for heavy-duty vehicles.
* * * * *

0
66. Section 86.1802-01 is revised to read as follows:


Sec.  86.1802-01  Section numbering; construction.

    (a) Section numbering. The model year of initial applicability is 
indicated by the section number. The two digits following the hyphen 
designate the first

[[Page 73983]]

model year for which a section is applicable. The section continues to 
apply to subsequent model years unless a later model year section is 
adopted. Example: Section 86.18xx-10 applies to model year 2010 and 
later vehicles. If a Sec.  86.18xx-17 is promulgated, it would apply 
beginning with the 2017 model year; Sec.  86.18xx-10 would apply only 
to model years 2010 through 2016, except as specified in Sec.  86.18xx-
17.
    (b) A section reference without a model year suffix refers to the 
section applicable for the appropriate model year.
    (c) If a regulation in this subpart references a section that has 
been superseded or no longer exists, this should be understood as a 
reference to the same section for the appropriate model year. For 
example, if a regulation in this subpart refers to Sec.  86.1845-01, it 
should be taken as a reference to Sec.  86.1845-04 or any later version 
of Sec.  86.1845 that applies for the appropriate model year. However, 
this does not apply if the reference to a superseded section 
specifically states that the older provision applies instead of any 
updated provisions from the section in effect for the current model 
year; this occurs most often as part of the transition to new emission 
standards.

0
67. Section 86.1803-01 is amended as follows:
0
a. By revising the definitions for ``Base level'', ``Base tire'', 
``Base vehicle'', and ``Basic engine''.
0
b. By adding a definition for ``Cab-complete vehicle'' in alphabetical 
order.
0
c. By revising the definitions for ``Carbon-related exhaust emissions 
(CREE)'', ``Configuration'', paragraph (1) of ``Emergency vehicle'', 
``Engine code'', ``Federal Test Procedure'', ``Highway Fuel Economy 
Test Procedure (HFET)'', ``Mild hybrid electric vehicle'', ``Model 
type'', ``Production volume'', ``Strong hybrid electric vehicle'', 
``Subconfiguration'', ``Transmission class'', and ``Transmission 
configuration''.
0
d. By adding a definition for ``Transmission type'' in alphabetical 
order.
    The revisions and additions read as follows:


Sec.  86.1803-01  Definitions.

    * Baselevel has the meaning given in 40 CFR 600.002 for LDV, LDT, 
and MDPV. See Sec.  86.1819-14 for heavy-duty vehicles.
    Base tire has the meaning given in 40 CFR 600.002 for LDV, LDT, and 
MDPV.
    Base vehicle has the meaning given in 40 CFR 600.002 for LDV, LDT, 
and MDPV.
    Basic engine has the meaning given in 40 CFR 600.002.
* * * * *
    Cab-complete vehicle means a heavy-duty vehicle that is first sold 
as an incomplete vehicle that substantially includes its cab. Vehicles 
known commercially as chassis-cabs, cab-chassis, box-deletes, bed-
deletes, cut-away vans are considered cab-complete vehicles. For 
purposes of this definition, a cab includes a steering column and 
passenger compartment. Note that a vehicle lacking some components of 
the cab is a cab-complete vehicle if it substantially includes the cab.
* * * * *
    Carbon-related exhaust emissions (CREE) has the meaning given in 40 
CFR 600.002 for LDV, LDT, and MDPV.
* * * * *
    Configuration means one of the following:
    (1) For LDV, LDT, and MDPV, configuration means a subclassification 
within a test group which is based on engine code, inertia weight 
class, transmission type and gear ratios, final drive ratio, and other 
parameters which may be designated by the Administrator.
    (2) For HDV, configuration has the meaning given in Sec.  86.1819-
14(d)(12).
* * * * *
    Emergency vehicle * * *
    (1) For the greenhouse gas emission standards in Sec.  86.1818, 
emergency vehicle means a motor vehicle manufactured primarily for use 
as an ambulance or combination ambulance-hearse or for use by the 
United States Government or a State or local government for law 
enforcement.
* * * * *
    Engine code means one of the following:
    (1) For LDV, LDT, and MDPV, engine code means a unique combination 
within a test group of displacement, fuel injection (or carburetor) 
calibration, choke calibration, distributor calibration, auxiliary 
emission control devices, and other engine and emission control system 
components specified by the Administrator. For electric vehicles, 
engine code means a unique combination of manufacturer, electric 
traction motor, motor configuration, motor controller, and energy 
storage device.
    (2) For HDV, engine code has the meaning given in Sec.  86.1819-
14(d)(12).
* * * * *
    Federal Test Procedure has the meaning given in 40 CFR 
1066.801(c)(1)(i).
* * * * *
    Highway Fuel Economy Test Procedure (HFET) has the meaning given in 
40 CFR 1066.801(c)(3).
* * * * *
    Mild hybrid electric vehicle means a hybrid electric vehicle that 
has start/stop capability and regenerative braking capability, where 
the recovered energy over the Federal Test Procedure is at least 15 
percent but less than 65 percent of the total braking energy, as 
measured and calculated according to 40 CFR 600.116-12(d).
    Model type has the meaning given in 40 CFR 600.002 for LDV, LDT, 
and MDPV.
* * * * *
    Production volume has the meaning given in 40 CFR 600.002.
* * * * *
    Strong hybrid electric vehicle means a hybrid electric vehicle that 
has start/stop capability and regenerative braking capability, where 
the recovered energy over the Federal Test Procedure is at least 65 
percent of the total braking energy, as measured and calculated 
according to 40 CFR 600.116-12(d).
    Subconfiguration means one of the following:
    (1) For LDV, LDT, and MDPV, subconfiguration has the meaning given 
in 40 CFR 600.002.
    (2) For HDV, subconfiguration has the meaning given in Sec.  
86.1819-14(d)(12).
* * * * *
    Transmission class has the meaning given in 40 CFR 600.002 for LDV, 
LDT, and MDPV.
    Transmission configuration has the meaning given in 40 CFR 600.002.
    Transmission type means the basic type of the transmission (e.g., 
automatic, manual, automated manual, semi-automatic, or continuously 
variable) and does not include the drive system of the vehicle (e.g., 
front-wheel drive, rear-wheel drive, or four-wheel drive).
* * * * *

0
68. Section 86.1805-17 is amended by revising paragraph (b) to read as 
follows:


Sec.  86.1805-17  Useful life.

* * * * *
    (b) Greenhouse gas pollutants. The emission standards in Sec.  
86.1818 apply for a useful life of 10 years or 120,000 miles for LDV 
and LLDT and 11 years or 120,000 miles for HLDT and MDPV. For non-MDPV 
heavy-duty vehicles, the emission standards in Sec.  86.1819 apply for 
a useful life of 11 years or 120,000 miles through model year 2020, and 
for a useful life of 15 years or 150,000 miles in model year 2021 and 
later. Manufacturers may certify based on the useful life as specified 
in paragraph (d) of this section if it is different than the

[[Page 73984]]

useful life specified in this paragraph (b).
* * * * *

0
69. Section 86.1811-17 is amended by revising paragraphs (b)(8)(iii)(C) 
and (g) to read as follows:


Sec.  86.1811-17  Exhaust emission standards for light-duty vehicles, 
light-duty trucks and medium-duty passenger vehicles.

* * * * *
    (b) * * *
    (8) * * *
    (iii) * * *
    (C) Vehicles must comply with the Tier 2 SFTP emission standards 
for NMHC + NOX and CO for 4,000-mile testing that are 
specified in Sec.  86.1811-04(f)(1) if they are certified to 
transitional Bin 85 or Bin 110 standards, or if they are certified 
based on a fuel without ethanol, or if they are not certified to the 
Tier 3 p.m. standard. Note that these standards apply under this 
section for alternative fueled vehicles, for flexible fueled vehicles 
when operated on a fuel other than gasoline or diesel fuel, and for 
MDPVs, even though these vehicles were not subject to the SFTP 
standards in the Tier 2 program.
* * * * *
    (g) Cold temperature exhaust emission standards. The standards in 
this paragraph (g) apply for certification and in-use vehicles tested 
over the test procedures specified in subpart C of this part. These 
standards apply only to gasoline-fueled vehicles. Multi-fuel, bi-fuel 
or dual-fuel vehicles must comply with requirements using gasoline 
only. Testing with other fuels such as a high-level ethanol-gasoline 
blend, or testing on diesel vehicles, is not required.
    (1) Cold temperature CO standards. Cold temperature CO exhaust 
emission standards apply for testing at both low-altitude conditions 
and high-altitude conditions as follows:
    (i) For LDV and LDT1, the standard is 10.0 g/mile CO.
    (ii) For LDT2, LDT3 and LDT4, the standard is 12.5 grams per mile 
CO.
    (2) Cold temperature NMHC standards. The following fleet average 
cold temperature NMHC standards apply as follows:
    (i) The standards are shown in the following table:

    Table 5 of Sec.   86.1811-17--Fleet Average Cold Temperature NMHC
                       Exhaust Emission Standards
------------------------------------------------------------------------
                                                               Cold
                                                            temperature
                                                            NMHC sales-
                 Vehicle weight category                  weighted fleet
                                                              average
                                                           standard  (g/
                                                               mile)
------------------------------------------------------------------------
LDV and LLDT............................................             0.3
HLDT....................................................             0.5
------------------------------------------------------------------------

    (ii) The manufacturer must calculate its fleet average cold 
temperature NMHC emission level(s) as described in Sec.  86.1864-10(m).
    (iii) The standards specified in this paragraph (g)(2) apply only 
for testing at low-altitude conditions. However, manufacturers must 
submit an engineering evaluation indicating that common calibration 
approaches are utilized at high altitudes. Any deviation from low 
altitude emission control practices must be included in the auxiliary 
emission control device (AECD) descriptions submitted at certification. 
Any AECD specific to high altitude must require engineering emission 
data for EPA evaluation to quantify any emission impact and validity of 
the AECD.
* * * * *

0
70. Section 86.1813-17 is amended by revising paragraphs (a)(1)(ii), 
(a)(2)(iii), and (f)(1) to read as follows:


Sec.  86.1813-17   Evaporative and refueling emission standards.

* * * * *
    (a) * * *
    (1) * * *
    (ii) Measure diurnal, running loss, and hot soak emissions as shown 
in Sec.  86.130. This includes separate measurements for the two-
diurnal test sequence and the three-diurnal test sequence; however, 
gaseous-fueled vehicles are not subject to any evaporative emission 
standards using the two-diurnal test sequence.
* * * * *
    (2) * * *
    (iii) Hydrocarbon emissions must not exceed 0.020 g for LDV and LDT 
and 0.030 g for HDV when tested using the Bleed Emission Test Procedure 
adopted by the California Air Resources Board as part of the LEV III 
program. This procedure quantifies diurnal emissions using the two-
diurnal test sequence without measuring hot soak emissions. The 
standards in this paragraph (a)(2)(iii) do not apply for testing at 
high-altitude conditions. For vehicles with non-integrated refueling 
canisters, the bleed emission test and standard do not apply to the 
refueling canister. You may perform the Bleed Emission Test Procedure 
using the analogous test temperatures and the E10 test fuel specified 
in subpart B of this part.
* * * * *
    (f) * * *
    (1) Compressed natural gas vehicles must meet the requirements for 
fueling connection devices as specified in ANSI NGV1-2006 or CSA IR-1-
15 (incorporated by reference in Sec.  86.1).
* * * * *

0
71. Section 86.1816-18 is amended by revising paragraphs (a) 
introductory text, (b)(7)(i) introductory text, and (b)(9) to read as 
follows:


Sec.  86.1816-18  Emission standards for heavy-duty vehicles.

    (a) Applicability and general provisions. This section describes 
exhaust emission standards that apply for model year 2018 and later 
complete heavy-duty vehicles. These standards are optional for 
incomplete heavy-duty vehicles and for heavy duty vehicles above 14,000 
pounds GVWR as described in Sec.  86.1801. Greenhouse gas emission 
standards are specified in Sec.  86.1818 for MDPV and in Sec.  86.1819 
for other HDV. See Sec.  86.1813 for evaporative and refueling emission 
standards. This section may apply to vehicles before model year 2018 as 
specified in paragraph (b)(11) of this section. Separate requirements 
apply for MDPV as specified in Sec.  86.1811. See subpart A of this 
part for requirements that apply for incomplete heavy-duty vehicles and 
for heavy-duty engines certified independent of the chassis. The 
following general provisions apply:
* * * * *
    (b) * * *
    (7) * * *
    (i) The fleet-average FTP emission standard for NMOG + 
NOX phases in over several years as described in this 
paragraph (b)(7)(i). You must identify FELs as described in paragraph 
(b)(4) of this section and calculate a fleet-average emission level to 
show that you meet the FTP emission standard for NMOG+NOX 
that applies for each model year. You may certify using transitional 
bin standards specified in Table 5 of this section through model year 
2021; these vehicles are subject to the FTP emission standard for 
formaldehyde as described in Sec.  86.1816-08. You may use the E0 test 
fuel specified in Sec.  86.113 for gasoline-fueled vehicles certified 
to the transitional bins; the useful life period for these vehicles is 
120,000 miles or 11 years. Fleet-average FTP emission

[[Page 73985]]

standards decrease as shown in the following table:
* * * * *
    (9) Except as specified in paragraph (b)(8) of this section, you 
may not use credits generated from vehicles certified under Sec.  
86.1816-08 for demonstrating compliance with the Tier 3 standards.
* * * * *

0
72. Section 86.1817-05 is amended by revising paragraph (c) 
introductory text to read as follows:


Sec.  86.1817-05  Complete heavy-duty vehicle averaging, trading, and 
banking program.

* * * * *
    (c) Calculations. For each participating test group, NOX 
emission credits (positive or negative) are to be calculated according 
to one of the following equations and rounded to the nearest one-tenth 
of a Megagram (Mg). Consistent units are to be used throughout the 
equation.
* * * * *

0
73. Section 86.1818-12 is amended by revising paragraphs (a)(2), 
(c)(4), and (f)(4) to read as follows:


Sec.  86.1818-12  Greenhouse gas emission standards for light-duty 
vehicles, light-duty trucks, and medium-duty passenger vehicles.

    (a) * * *
    (2) The standards specified in this section apply for testing at 
both low-altitude conditions and high-altitude conditions. However, 
manufacturers must submit an engineering evaluation indicating that 
common calibration approaches are utilized at high altitude instead of 
performing testing for certification, consistent with Sec.  86.1829. 
Any deviation from low altitude emission control practices must be 
included in the auxiliary emission control device (AECD) descriptions 
submitted at certification. Any AECD specific to high altitude requires 
engineering emission data for EPA evaluation to quantify any emission 
impact and determine the validity of the AECD.
* * * * *
    (c) * * *
    (4) Emergency vehicles. Emergency vehicles may be excluded from the 
emission standards described in this section. The manufacturer must 
notify the Administrator that they are making such an election in the 
model year reports required under Sec.  600.512 of this chapter. Such 
vehicles should be excluded from both the calculation of the fleet 
average standard for a manufacturer under this paragraph (c) and from 
the calculation of the fleet average carbon-related exhaust emissions 
in Sec.  600.510-12.
* * * * *
    (f) * * *
    (4) CO2-equivalent debits. CO2-equivalent 
debits for test groups using an alternative N2O and/or 
CH4 standard as determined under paragraph (f)(3) of this 
section shall be calculated according to the following equation and 
rounded to the nearest whole megagram:

Debits = [GWP x (Production) x (AltStd--Std) x VLM] / 1,000,000

Where:

Debits = CO2-equivalent debits for N2O or 
CH4, in Megagrams, for a test group using an alternative 
N2O or CH4 standard, rounded to the nearest 
whole Megagram;
GWP = 25 if calculating CH4 debits and 298 if calculating 
N2O debits;
Production = The number of vehicles of that test group domestically 
produced plus those imported as defined in Sec.  600.511 of this 
chapter;
AltStd = The alternative standard (N2O or CH4) 
selected by the manufacturer under paragraph (f)(3) of this section;
Std = The exhaust emission standard for N2O or 
CH4 specified in paragraph (f)(1) of this section; and
VLM = 195,264 for passenger automobiles and 225,865 for light 
trucks.
* * * * *

0
74. Section 86.1819-14 is added to subpart S to read as follows:


Sec.  86.1819-14  Greenhouse gas emission standards for heavy-duty 
vehicles.

    This section describes exhaust emission standards for 
CO2, CH4, and N2O for heavy-duty 
vehicles. The standards of this section apply for model year 2014 and 
later vehicles that are chassis-certified with respect to criteria 
pollutants under this subpart S. Additional heavy-duty vehicles may be 
optionally subject to the standards of this section as allowed under 
paragraph (j) of this section. Any heavy-duty vehicles not subject to 
standards under this section are instead subject to greenhouse gas 
standards under 40 CFR part 1037, and engines installed in these 
vehicles are subject to standards under 40 CFR part 1036. If you are 
not the engine manufacturer, you must notify the engine manufacturer 
that its engines are subject to 40 CFR part 1036 if you intend to use 
their engines in vehicles that are not subject to standards under this 
section. Vehicles produced by small businesses may be excluded from the 
standards of this section as described in paragraph (k)(5) of this 
section.
    (a) Fleet-average CO2 emission standards. Fleet-average 
CO2 emission standards apply for the full useful life for 
each manufacturer as follows:
    (1) Calculate a work factor, WF, for each vehicle subconfiguration 
(or group of subconfigurations as allowed under paragraph (a)(4) of 
this section), rounded to the nearest pound, using the following 
equation:

    WF = 0.75 x (GVWR - Curb Weight + xwd) + 0.25 x (GCWR - GVWR)

Where:

xwd = 500 pounds if the vehicle has four-wheel drive or all-wheel 
drive; xwd = 0 pounds for all other vehicles.

    (2) Using the appropriate work factor, calculate a target value for 
each vehicle subconfiguration (or group of subconfigurations as allowed 
under paragraph (a)(4) of this section) you produce using one of the 
following equations, or the phase-in provisions in paragraph (k)(4) of 
this section, rounding to the nearest whole g/mile:
    (i) For model year 2027 and later vehicles with spark-ignition 
engines: CO2 Target (g/mile) = 0.0369 x WF + 284
    (ii) For model year 2027 and later vehicles with compression-
ignition engines or with no engines (such as electric vehicles and fuel 
cell vehicles): CO2 Target (g/mile) = 0.0348 x WF + 268
    (3) Calculate a production-weighted average of the target values 
and round it to the nearest whole g/mile. This is your fleet-average 
standard. All vehicles subject to the standards of this section form a 
single averaging set. Use the following equation to calculate your 
fleet-average standard from the target value for each vehicle 
subconfiguration (Targeti) and U.S.-directed production 
volume of each vehicle subconfiguration for the given model year 
(Volumei):
[GRAPHIC] [TIFF OMITTED] TR25OC16.040

    (4) You may group subconfigurations within a configuration together 
for purposes of calculating your fleet-average standard as follows:
    (i) You may group together subconfigurations that have the same

[[Page 73986]]

equivalent test weight (ETW), GVWR, and GCWR. Calculate your work 
factor and target value assuming a curb weight equal to two times ETW 
minus GVWR.
    (ii) You may group together other subconfigurations if you use the 
lowest target value calculated for any of the subconfigurations.
    (5) The standards specified in this section apply for testing at 
both low-altitude conditions and high-altitude conditions. However, 
manufacturers must submit an engineering evaluation indicating that 
common calibration approaches are utilized at high altitude instead of 
performing testing for certification, consistent with Sec.  86.1829. 
Any deviation from low altitude emission control practices must be 
included in the auxiliary emission control device (AECD) descriptions 
submitted at certification. Any AECD specific to high altitude requires 
engineering emission data for EPA evaluation to quantify any emission 
impact and determine the validity of the AECD.
    (b) Production and in-use CO2 standards. Each vehicle 
you produce that is subject to the standards of this section has an 
``in-use'' CO2 standard that is calculated from your test 
result and that applies for selective enforcement audits and in-use 
testing. This in-use CO2 standard for each vehicle is equal 
to the applicable deteriorated emission level multiplied by 1.10 and 
rounded to the nearest whole g/mile.
    (c) N2O and CH4 standards. Except as allowed under this paragraph 
(c), all vehicles subject to the standards of this section must comply 
with an N2O standard of 0.05 g/mile and a CH4 
standard of 0.05 g/mile when calculated according to the provisions of 
paragraph (d)(4) of this section. You may specify CH4 and/or 
N2O alternative standards using CO2 emission 
credits instead of these otherwise applicable emission standards for 
one or more test groups. To do this, calculate the CH4 and/
or N2O emission credits needed (negative credits) using the 
equation in this paragraph (c) based on the FEL(s) you specify for your 
vehicles during certification. You must adjust the calculated emissions 
by the global warming potential (GWP): GWP equals 34 for CH4 
from model year 2021 and later vehicles, 25 for CH4 from 
earlier vehicles, and 298 for N2O. This means, for example, 
that you must use 298 Mg of positive CO2 credits to offset 1 
Mg of negative N2O credits. Note that Sec.  86.1818-12(f) 
does not apply for vehicles subject to the standards of this section. 
Calculate credits using the following equation, rounded to the nearest 
whole number:

CO2 Credits Needed (Mg) = [(FEL - Std) x (U.S.-directed 
production volume) x (Useful Life)] x (GWP) / 1,000,000

    (d) Compliance provisions. The following compliance provisions 
apply instead of other provisions described in this subpart S:
    (1) The CO2 standards of this section apply with respect 
to CO2 emissions, not with respect to carbon-related exhaust 
emissions (CREE).
    (2) The following general credit provisions apply:
    (i) Credits you generate under this section may be used only to 
offset credit deficits under this section. You may bank credits for use 
in a future model year in which your average CO2 level 
exceeds the standard. You may trade credits to another manufacturer 
according to Sec.  86.1865-12(k)(8). Before you bank or trade credits, 
you must apply any available credits to offset a deficit if the 
deadline to offset that credit deficit has not yet passed.
    (ii) Vehicles subject to the standards of this section are included 
in a single greenhouse gas averaging set separate from any averaging 
set otherwise included in this subpart S.
    (iii) Banked CO2 credits keep their full value for five 
model years after the year in which they were generated. Unused credits 
may not be used for more than five model years after the model year in 
which the credits are generated.
    (3) Special credit and incentive provisions related to air 
conditioning in Sec. Sec.  86.1867 and 86.1868 do not apply for 
vehicles subject to the standards of this section.
    (4) Measure emissions using the procedures of subpart B of this 
part and 40 CFR part 1066. Determine separate emission results for the 
Federal Test Procedure (FTP) described in 40 CFR 1066.801(c)(1) and the 
Highway Fuel Economy Test (HFET) described in 40 CFR 1066.801(c)(3). 
Calculate composite emission results from these two test cycles for 
demonstrating compliance with the CO2, N2O, and 
CH4 standards based on a weighted average of the FTP (55%) 
and HFET (45%) emission results. Note that this differs from the way 
the criteria pollutant standards apply.
    (5) Apply an additive deterioration factor of zero to measured 
CO2 emissions unless good engineering judgment indicates 
that emissions are likely to deteriorate in use. Use good engineering 
judgment to develop separate deterioration factors for N2O 
and CH4.
    (6) Credits are calculated using the useful life value (in miles) 
in place of ``vehicle lifetime miles'' as specified in Sec.  86.1865. 
Calculate a total credit or debit balance in a model year by adding 
credits and debits from Sec.  86.1865-12(k)(4), subtracting any 
CO2-equivalent debits for N2O or CH4 
calculated according to paragraph (c) of this section, and adding any 
of the following credits:
    (i) Off-cycle technology credits according to paragraph (d)(13) of 
this section.
    (ii) Early credits from vehicles certified under paragraph (k)(2) 
of this section.
    (iii) Advanced-technology credits according to paragraph (k)(7) of 
this section.
    (7) [Reserved]
    (8) The provisions of Sec.  86.1818 do not apply.
    (9) Calculate your fleet-average emission rate consistent with good 
engineering judgment and the provisions of Sec.  86.1865. The following 
additional provisions apply:
    (i) Unless we approve a lower number, you must test at least ten 
subconfigurations. If you produce more than 100 subconfigurations in a 
given model year, you must test at least ten percent of your 
subconfigurations. For purposes of this paragraph (d)(9)(i), count 
carryover tests, but do not include analytically derived CO2 
emission rates, data substitutions, or other untested allowances. We 
may approve a lower number of tests for manufacturers that have limited 
product offerings, or low sales volumes. Note that good engineering 
judgment and other provisions of this part may require you to test more 
subconfigurations than these minimum values.
    (ii) The provisions of paragraph (g) of this section specify how 
you may use analytically derived CO2 emission rates.
    (iii) At least 90 percent of final production volume at the 
configuration level must be represented by test data (real, data 
substituted, or analytical).
    (iv) Perform fleet-average CO2 calculations as described 
in Sec.  86.1865 and 40 CFR part 600, with the following exceptions:
    (A) Use CO2 emissions values for all test results, 
intermediate calculations, and fleet average calculations instead of 
the carbon-related exhaust emission (CREE) values specified in this 
subpart S and 40 CFR part 600.
    (B) Perform intermediate CO2 calculations for 
subconfigurations within each configuration using the subconfiguration 
and configuration definitions in paragraph (d)(12) of this section.
    (C) Perform intermediate CO2 calculations for 
configurations within

[[Page 73987]]

each test group and transmission type (instead of configurations within 
each base level and base levels within each model type). Use the 
configuration definition in paragraph (d)(12)(i) of this section.
    (D) Do not perform intermediate CO2 calculations for 
each base level or for each model type. Base level and model type 
CO2 calculations are not applicable to heavy-duty vehicles 
subject to standards in this section.
    (E) Determine fleet average CO2 emissions for heavy-duty 
vehicles subject to standards in this section as described in 40 CFR 
600.510-12(j), except that the calculations must be performed on the 
basis of test group and transmission type (instead of the model-type 
basis specified in the light-duty vehicle regulations), and the 
calculations for dual-fuel, multi-fuel, and flexible-fuel vehicles must 
be consistent with the provisions of paragraph (d)(10)(i) of this 
section.
    (10) For dual-fuel, multi-fuel, and flexible-fuel vehicles, perform 
exhaust testing on each fuel type (for example, gasoline and E85).
    (i) For your fleet-average calculations in model year 2016 and 
later, use either the conventional-fueled CO2 emission rate 
or a weighted average of your emission results as specified in 40 CFR 
600.510-12(k) for light-duty trucks. For your fleet-average 
calculations before model year 2016, apply an equal weighting of 
CO2 emission results from alternative and conventional 
fuels.
    (ii) If you certify to an alternate standard for N2O or 
CH4 emissions, you may not exceed the alternate standard 
when tested on either fuel.
    (11) Test your vehicles with an equivalent test weight based on its 
Adjusted Loaded Vehicle Weight (ALVW). Determine equivalent test weight 
from the ALVW as specified in 40 CFR 1066.805; round ALVW values above 
14,000 pounds to the nearest 500 pound increment.
    (12) The following definitions apply for the purposes of this 
section:
    (i) Configuration means a subclassification within a test group 
based on engine code, transmission type and gear ratios, final drive 
ratio, and other parameters we designate. Engine code means the 
combination of both ``engine code'' and ``basic engine'' as defined in 
40 CFR 600.002.
    (ii) Subconfiguration means a unique combination within a vehicle 
configuration (as defined in this paragraph (d)(12)) of equivalent test 
weight, road-load horsepower, and any other operational characteristics 
or parameters that we determine may significantly affect CO2 
emissions within a vehicle configuration. Note that for vehicles 
subject to standards of this section, equivalent test weight (ETW) is 
based on the ALVW of the vehicle as outlined in paragraph (d)(11) of 
this section.
    (13) This paragraph (d)(13) applies for CO2 reductions 
resulting from technologies that were not in common use before 2010 
that are not reflected in the specified test procedures. While you are 
not required to prove that such technologies were not in common use 
with heavy-duty vehicles before model year 2010, we will not approve 
your request if we determine they do not qualify. These may be 
described as off-cycle or innovative technologies. We may allow you to 
generate emission credits consistent with the provisions of Sec.  
86.1869-12(c) and (d). The 5-cycle methodology is not presumed to be 
preferred over alternative methodologies described in Sec.  86.1869-
12(d).
    (14) You must submit pre-model year reports before you submit your 
applications for certification for a given model year. Unless we 
specify otherwise, include the information specified for pre-model year 
reports in 49 CFR 535.8.
    (15) You must submit a final report within 90 days after the end of 
the model year. Unless we specify otherwise, include applicable 
information identified in Sec.  86.1865-12(l), 40 CFR 600.512, and 49 
CFR 535.8(e). The final report must include at least the following 
information:
    (i) Model year.
    (ii) Applicable fleet-average CO2 standard.
    (iii) Calculated fleet-average CO2 value and all the 
values required to calculate the CO2 value.
    (iv) Number of credits or debits incurred and all values required 
to calculate those values.
    (v) Resulting balance of credits or debits.
    (vi) N2O emissions.
    (vii) CH4 emissions.
    (viii) Total and percent leakage rates under paragraph (h) of this 
section.
    (16) You may apply the provisions for delegated assembly as 
described in 40 CFR 1037.621.
    (17) You may calculate emission rates for weight increments less 
than the 500 pound increment specified for test weight. This does not 
change the applicable test weights.
    (i) Use the ADC equation in paragraph (g) of this section to adjust 
your emission rates for vehicles in increments of 50, 100, or 250 
pounds instead of the 500 test-weight increments. Adjust emissions to 
the midpoint of each increment. This is the equivalent emission weight. 
For example, vehicles with a test weight basis of 11,751 to 12,250 
pounds (which have an equivalent test weight of 12,000 pounds) could be 
regrouped into 100 pound increments as follows:

------------------------------------------------------------------------
                                            Equivalent
            Test weight basis                emission       Equivalent
                                              weight        test weight
------------------------------------------------------------------------
11,751-11,850...........................          11,800          12,000
11,851-11,950...........................          11,900          12,000
11,951-12,050...........................          12,000          12,000
12,051-12,150...........................          12,100          12,000
12,151-12,250...........................          12,200          12,000
------------------------------------------------------------------------

    (ii) You must use the same increment for all equivalent test weight 
classes across your whole product line in a given model year. You must 
also specify curb weight for calculating the work factor in a way that 
is consistent with your approach for determining test weight for 
calculating ADCs under this paragraph (d)(17).
    (e) Useful life. The exhaust emission standards of this section 
apply for the full useful life, as described in Sec.  86.1805.
    (f) [Reserved]
    (g) Analytically derived CO2 emission rates (ADCs). This 
paragraph (g) describes an allowance to use estimated (i.e., 
analytically derived) CO2 emission rates based on baseline 
test data instead of measured emission rates for calculating fleet-
average emissions. Note that these ADCs are similar to ADFEs used for 
light-duty vehicles. Note also that F terms used in this paragraph (g) 
represent coefficients from the following road load equation:


[[Page 73988]]


Force = F0 + F1 [middot] (velocity) + 
F2 [middot] (velocity)\2\

    (1) Except as specified in paragraph (g)(2) of this section, use 
the following equation to calculate the ADC of a new vehicle from road 
load force coefficients (F0, F1, F2), axle ratio, and test weight:

ADC = CO2base + 2.18 [middot] [Delta]F0 + 37.4 [middot] 
[Delta]F1 + 2257 [middot] [Delta]F2 + 189 [middot] [Delta]AR + 
0.0222[middot] [Delta]ETW

Where:

ADC = Analytically derived combined city/highway CO2 
emission rate (g/mile) for a new vehicle.
CO2base = Combined city/highway CO2 emission 
rate (g/mile) of a baseline vehicle.
[Delta]F0 = F0 of the new vehicle-F0 of the baseline vehicle.
[Delta]F1 = F1 of the new vehicle-F1 of the baseline vehicle.
[Delta]F2 = F2 of the new vehicle-F2 of the baseline vehicle.
[Delta]AR = Axle ratio of the new vehicle-axle ratio of the baseline 
vehicle.
[Delta]ETW = ETW of the new vehicle-ETW of the baseline vehicle.

    (2) The purpose of this section is to accurately estimate 
CO2 emission rates.
    (i) You must apply the provisions of this section consistent with 
good engineering judgment. For example, do not use the equation in 
paragraph (g)(1) of this section where good engineering judgment 
indicates that it will not accurately estimate emissions. You may ask 
us to approve alternate equations that allow you to estimate emissions 
more accurately.
    (ii) The analytically derived CO2 equation in paragraph 
(g)(1) of this section may be periodically updated through publication 
of an EPA guidance document to more accurately characterize 
CO2 emission levels for example, changes may be appropriate 
based on new test data, future technology changes, or to changes in 
future CO2 emission levels. Any EPA guidance document will 
determine the model year that the updated equation takes effect. We 
will issue guidance no later than eight months before the effective 
model year. For example, model year 2014 may start January 2, 2013, so 
guidance for model year 2014 would be issued by May 1, 2012.
    (3) You may select baseline test data without our advance approval 
if they meet all the following criteria:
    (i) Vehicles considered for the baseline test must comply with all 
applicable emission standards in the model year associated with the 
ADC.
    (ii) You must include in the pool of tests considered for baseline 
selection all official tests of the same or equivalent basic engine, 
transmission class, engine code, transmission code, engine horsepower, 
dynamometer drive wheels, and compression ratio as the ADC 
subconfiguration. Do not include tests in which emissions exceed any 
applicable standard.
    (iii) Where necessary to minimize the CO2 adjustment, 
you may supplement the pool with tests associated with worst-case 
engine or transmission codes and carryover or carry-across test groups. 
If you do, all the data that qualify for inclusion using the elected 
worst-case substitution (or carryover or carry-across) must be included 
in the pool as supplemental data (i.e., individual test vehicles may 
not be selected for inclusion). You must also include the supplemental 
data in all subsequent pools, where applicable.
    (iv) Tests previously used during the subject model year as 
baseline tests in ten other ADC subconfigurations must be eliminated 
from the pool.
    (v) Select the tested subconfiguration with the smallest absolute 
difference between the ADC and the test CO2 emission rate 
for combined emissions. Use this as the baseline test for the target 
ADC subconfiguration.
    (4) You may ask us to allow you to use baseline test data not fully 
meeting the provisions of paragraph (g)(3) of this section.
    (5) Calculate the ADC rounded to the nearest whole g/mile. Except 
with our advance approval, the downward adjustment of ADC from the 
baseline is limited to ADC values 20 percent below the baseline 
emission rate. The upward adjustment is not limited.
    (6) You may not submit an ADC if an actual test has been run on the 
target subconfiguration during the certification process or on a 
development vehicle that is eligible to be declared as an emission-data 
vehicle.
    (7) No more than 40 percent of the subconfigurations tested in your 
final CO2 submission may be represented by ADCs.
    (8) Keep the following records for at least five years, and show 
them to us if we ask to see them:
    (i) The pool of tests.
    (ii) The vehicle description and tests chosen as the baseline and 
the basis for the selection.
    (iii) The target ADC subconfiguration.
    (iv) The calculated emission rates.
    (9) We may perform or order a confirmatory test of any 
subconfiguration covered by an ADC.
    (10) Where we determine that you did not fully comply with the 
provisions of this paragraph (g), we may require that you comply based 
on actual test data and that you recalculate your fleet-average 
emission rate.
    (h) Air conditioning leakage. Loss of refrigerant from your air 
conditioning systems may not exceed a total leakage rate of 11.0 grams 
per year or a percent leakage rate of 1.50 percent per year, whichever 
is greater. This applies for all refrigerants. Calculate the total 
leakage rate in g/year as specified in Sec.  86.1867-12(a). Calculate 
the percent leakage rate as: [total leakage rate (g/yr)] / [total 
refrigerant capacity (g)] x 100. Round your percent leakage rate to the 
nearest one-hundredth of a percent. For purpose of this requirement, 
``refrigerant capacity'' is the total mass of refrigerant recommended 
by the vehicle manufacturer as representing a full charge. Where full 
charge is specified as a pressure, use good engineering judgment to 
convert the pressure and system volume to a mass.
    (i) [Reserved]
    (j) Optional GHG certification under this subpart. You may certify 
certain complete or cab-complete vehicles to the GHG standards of this 
section. All vehicles optionally certified under this paragraph (j) are 
deemed to be subject to the GHG standards of this section. Note that 
for vehicles above 14,000 pounds GVWR and at or below 26,000 pounds 
GVWR, GHG certification under this paragraph (j) does not affect how 
you may or may not certify with respect to criteria pollutants.
    (1) For GHG compliance, you may certify any complete or cab-
complete spark-ignition vehicles above 14,000 pounds GVWR and at or 
below 26,000 pounds GVWR to the GHG standards of this section even 
though this section otherwise specifies that you may certify vehicles 
to the GHG standards of this section only if they are chassis-certified 
for criteria pollutants.
    (2) You may apply the provisions of this section to cab-complete 
vehicles based on a complete sister vehicle. In unusual circumstances, 
you may ask us to apply these provisions to Class 2b or Class 3 
incomplete vehicles that do not meet the definition of cab-complete.
    (i) Except as specified in paragraph (j)(3) of this section, for 
purposes of this section, a complete sister vehicle is a complete 
vehicle of the same vehicle configuration as the cab-complete vehicle. 
You may not apply the provisions of this paragraph (j) to any vehicle 
configuration that has a four-wheel rear axle if the complete sister 
vehicle has a two-wheel rear axle.
    (ii) Calculate the target value for fleet-average CO2 
emissions under paragraph (a) or (k)(4) of this section based on the 
work factor value that applies for the complete sister vehicle.
    (iii) Test these cab-complete vehicles using the same equivalent 
test weight

[[Page 73989]]

and other dynamometer settings that apply for the complete vehicle from 
which you used the work factor value (the complete sister vehicle). For 
GHG certification, you may submit the test data from that complete 
sister vehicle instead of performing the test on the cab-complete 
vehicle.
    (iv) You are not required to produce the complete sister vehicle 
for sale to use the provisions of this paragraph (j)(2). This means the 
complete sister vehicle may be a carryover vehicle from a prior model 
year or a vehicle created solely for the purpose of testing.
    (3) For GHG purposes, if a cab-complete vehicle is not of the same 
vehicle configuration as a complete sister vehicle due only to certain 
factors unrelated to coastdown performance, you may use the road-load 
coefficients from the complete sister vehicle for certification testing 
of the cab-complete vehicle, but you may not use emission data from the 
complete sister vehicle for certifying the cab-complete vehicle.
    (k) Interim provisions. The following provisions apply instead of 
other provisions in this subpart:
    (1) Incentives for early introduction. Manufacturers may 
voluntarily certify in model year 2013 (or earlier model years for 
electric vehicles) to the greenhouse gas standards that apply starting 
in model year 2014 as specified in 40 CFR 1037.150(a).
    (2) Early credits. To generate early credits under this paragraph 
(k)(2) for any vehicles other than electric vehicles, you must certify 
your entire U.S.-directed fleet to these standards. If you calculate a 
separate fleet average for advanced-technology vehicles under paragraph 
(k)(7) of this section, you must certify your entire U.S.-directed 
production volume of both advanced and conventional vehicles within the 
fleet. If some test groups are certified after the start of the model 
year, you may generate credits only for production that occurs after 
all test groups are certified. For example, if you produce three test 
groups in an averaging set and you receive your certificates for those 
test groups on January 4, 2013, March 15, 2013, and April 24, 2013, you 
may not generate credits for model year 2013 for vehicles from any of 
the test groups produced before April 24, 2013. Calculate credits 
relative to the standard that would apply in model year 2014 using the 
applicable equations in this subpart and your model year 2013 U.S.-
directed production volumes. These credits may be used to show 
compliance with the standards of this subpart for 2014 and later model 
years. We recommend that you notify us of your intent to use this 
provision before submitting your applications.
    (3) Compliance date. Compliance with the standards of this section 
was optional before January 1, 2014 as specified in 40 CFR 1037.150(g).
    (4) Phase-in provisions. Each manufacturer must choose one of the 
options specified in paragraphs (k)(4)(i) and (ii) of this section for 
phasing in the Phase 1 standards. Manufacturers must follow the 
schedule described in paragraph (k)(4)(iii) of this section for phasing 
in the Phase 2 standards.
    (i) Phase 1--Option 1. You may implement the Phase 1 standards by 
applying CO2 target values as specified in the following 
table for model year 2014 through 2020 vehicles:

                      Table 1 of Sec.   86.1819-14
------------------------------------------------------------------------
    Model year and engine cycle        Alternate CO2 target  (g/mile)
------------------------------------------------------------------------
2014 Spark-Ignition...............  0.0482 x (WF) + 371
2015 Spark-Ignition...............  0.0479 x (WF) + 369
2016 Spark-Ignition...............  0.0469 x (WF) + 362
2017 Spark-Ignition...............  0.0460 x (WF) + 354
2018-2020 Spark-Ignition..........  0.0440 x (WF) + 339
2014 Compression-Ignition.........  0.0478 x (WF) + 368
2015 Compression-Ignition.........  0.0474 x (WF) + 366
2016 Compression-Ignition.........  0.0460 x (WF) + 354
2017 Compression-Ignition.........  0.0445 x (WF) + 343
2018-2020 Compression-Ignition....  0.0416 x (WF) + 320
------------------------------------------------------------------------

    (ii) Phase 1--Option 2. You may implement the Phase 1 standards by 
applying CO2 target values specified in the following table 
for model year 2014 through 2020 vehicles:

                      Table 2 of Sec.   86.1819-14
------------------------------------------------------------------------
    Model year and engine cycle        Alternate CO2 target  (g/mile)
------------------------------------------------------------------------
2014 Spark-Ignition...............  0.0482 x (WF) + 371
2015 Spark-Ignition...............  0.0479 x (WF) + 369
2016-2018 Spark-Ignition..........  0.0456 x (WF) + 352
2019-2020 Spark-Ignition..........  0.0440 x (WF) + 339
2014 Compression-Ignition.........  0.0478 x (WF) + 368
2015 Compression-Ignition.........  0.0474 x (WF) + 366
2016-2018 Compression-Ignition....  0.0440 x (WF) + 339
2019-2020 Compression-Ignition....  0.0416 x (WF) + 320
------------------------------------------------------------------------

    (iii) Phase 2. Apply Phase 2 CO2 target values as 
specified in the following table for model year 2021 through 2026 
vehicles:

[[Page 73990]]



                      Table 3 of Sec.   86.1819-14
------------------------------------------------------------------------
    Model year and engine cycle        Alternate CO2 target  (g/mile)
------------------------------------------------------------------------
2021 Spark-Ignition...............  0.0429 x (WF) + 331
2022 Spark-Ignition...............  0.0418 x (WF) + 322
2023 Spark-Ignition...............  0.0408 x (WF) + 314
2024 Spark-Ignition...............  0.0398 x (WF) + 306
2025 Spark-Ignition...............  0.0388 x (WF) + 299
2026 Spark-Ignition...............  0.0378 x (WF) + 291
2021 Compression-Ignition.........  0.0406 x (WF) + 312
2022 Compression-Ignition.........  0.0395 x (WF) + 304
2023 Compression-Ignition.........  0.0386 x (WF) + 297
2024 Compression-Ignition.........  0.0376 x (WF) + 289
2025 Compression-Ignition.........  0.0367 x (WF) + 282
2026 Compression-Ignition.........  0.0357 x (WF) + 275
------------------------------------------------------------------------

    (5) Provisions for small manufacturers. Standards apply on a 
delayed schedule for manufacturers meeting the small business criteria 
specified in 13 CFR 121.201 (NAICS code 336111); the employee and 
revenue limits apply to the total number employees and total revenue 
together for affiliated companies. Qualifying small manufacturers are 
not subject to the greenhouse gas standards of this section for 
vehicles with a date of manufacture before January 1, 2022, as 
specified in 40 CFR 1037.150(c). In addition, small manufacturers 
producing vehicles that run on any fuel other than gasoline, E85, or 
diesel fuel may delay complying with every later standard under this 
part by one model year.
    (6) Alternate N2O standards. Manufacturers may show compliance with 
the N2O standards using an engineering analysis. This 
allowance also applies for model year 2015 and later test groups 
carried over from model 2014 consistent with the provisions of Sec.  
86.1839. You may not certify to an N2O FEL different than 
the standard without measuring N2O emissions.
    (7) Advanced-technology credits. Provisions for advanced-technology 
credits apply as described in 40 CFR 1037.615. If you generate credits 
from Phase 1 vehicles certified with advanced technology, you may 
multiply these credits by 1.50. If you generate credits from Phase 2 
vehicles certified with advanced technology, you may multiply these 
credits by 3.5 for plug-in hybrid electric vehicles, 4.5 for electric 
vehicles, and 5.5 for fuel cell vehicles. Advanced-technology credits 
from Phase 1 vehicles may be used to show compliance with any standards 
of this part or 40 CFR part 1036 or part 1037, subject to the 
restrictions in 40 CFR 1037.740. Similarly, you may use up to 60,000 Mg 
per year of advanced-technology credits generated under 40 CFR 1036.615 
or 1037.615 (from Phase 1 vehicles) to demonstrate compliance with the 
CO2 standards in this section. Include vehicles generating 
credits in separate fleet-average calculations (and exclude them from 
your conventional fleet-average calculation). You must first apply 
these advanced-technology vehicle credits to any deficits for other 
vehicles in the averaging set before applying them to other averaging 
sets.
    (8) Loose engine sales. This paragraph (k)(8) applies for model 
year 2023 and earlier spark-ignition engines with identical hardware 
compared with engines used in vehicles certified to the standards of 
this section, where you sell such engines as loose engines or as 
engines installed in incomplete vehicles that are not cab-complete 
vehicles. You may include such engines in a test group certified to the 
standards of this section, subject to the following provisions:
    (i) Engines certified under this paragraph (k)(8) are deemed to be 
certified to the standards of 40 CFR 1036.108 as specified in 40 CFR 
1036.150(j).
    (ii) For 2020 and earlier model years, the maximum allowable U.S.-
directed production volume of engines you sell under this paragraph 
(k)(8) in any given model year is ten percent of the total U.S-directed 
production volume of engines of that design that you produce for heavy-
duty applications for that model year, including engines you produce 
for complete vehicles, cab-complete vehicles, and other incomplete 
vehicles. The total number of engines you may certify under this 
paragraph (k)(8), of all engine designs, may not exceed 15,000 in any 
model year. Engines produced in excess of either of these limits are 
not covered by your certificate. For example, if you produce 80,000 
complete model year 2017 Class 2b pickup trucks with a certain engine 
and 10,000 incomplete model year 2017 Class 3 vehicles with that same 
engine, and you do not apply the provisions of this paragraph (k)(8) to 
any other engine designs, you may produce up to 10,000 engines of that 
design for sale as loose engines under this paragraph (k)(8). If you 
produced 11,000 engines of that design for sale as loose engines, the 
last 1,000 of them that you produced in that model year 2017 would be 
considered uncertified.
    (iii) For model years 2021 through 2023, the U.S.-directed 
production volume of engines you sell under this paragraph (k)(8) in 
any given model year may not exceed 10,000 units.
    (iv) This paragraph (k)(8) does not apply for engines certified to 
the standards of 40 CFR 1036.108.
    (v) Label the engines as specified in 40 CFR 1036.135 including the 
following compliance statement: ``THIS ENGINE WAS CERTIFIED TO THE 
ALTERNATE GREENHOUSE GAS EMISSION STANDARDS OF 40 CFR 1036.150(j).'' 
List the test group name instead of an engine family name.
    (vi) Vehicles using engines certified under this paragraph (k)(8) 
are subject to the emission standards of 40 CFR 1037.105.
    (vii) For certification purposes, your engines are deemed to have a 
CO2 target value and test result equal to the CO2 
target value and test result for the complete vehicle in the applicable 
test group with the highest equivalent test weight, except as specified 
in paragraph (k)(8)(vii)(B) of this section. Use these values to 
calculate your target value, fleet-average emission rate, and in-use 
emission standard. Where there are multiple complete vehicles with the 
same highest equivalent test weight, select the CO2 target 
value and test result as follows:
    (A) If one or more of the CO2 test results exceed the 
applicable target value, use the CO2 target value and test 
result of the vehicle that exceeds its target value by the greatest 
amount.

[[Page 73991]]

    (B) If none of the CO2 test results exceed the 
applicable target value, select the highest target value and set the 
test result equal to it. This means that you may not generate emission 
credits from vehicles certified under this paragraph (k)(8).
    (viii) Production and in-use CO2 standards apply as 
described in paragraph (b) of this section.
    (ix) N2O and CH4 standards apply as described 
in paragraph (c) of this section.
    (x) State in your applications for certification that your test 
group and engine family will include engines certified under this 
paragraph (k)(8). This applies for your greenhouse gas vehicle test 
group and your criteria pollutant engine family. List in each 
application the name of the corresponding test group/engine family.
    (9) Credit adjustment for useful life. For credits that you 
calculate based on a useful life of 120,000 miles, multiply any banked 
credits that you carry forward for use in model year 2021 and later by 
1.25.
    (10) CO2 rounding. For model year 2014 and earlier vehicles, you 
may round measured and calculated CO2 emission levels to the 
nearest 0.1 g/mile, instead of the nearest whole g/mile as specified in 
paragraphs (a), (b), and (g) of this section.

0
75. Section 86.1820-01 is amended by revising paragraph (b)(7)(i)(A) to 
read as follows:


Sec.  86.1820-01   Durability group determination.

* * * * *
    (b) * * *
    (7) * * *
    (i) * * *
    (A) Vehicles are grouped based upon the value of the grouping 
statistic determined using the following equation:

GS = [(Cat Vol)/(Disp)] x Loading Rate


Where:

GS = Grouping Statistic used to evaluate the range of precious metal 
loading rates and relative sizing of the catalysts compared to the 
engine displacement that are allowable within a durability group. 
The grouping statistic shall be rounded to a tenth of a gram/liter.
Cat Vol = Total volume of the catalyst(s) in liters.
Disp = Displacement of the engine in liters.
Loading rate = The mass of total precious metal(s) in the catalyst 
(or the total mass of all precious metal(s) of all the catalysts if 
the vehicle is equipped with multiple catalysts) in grams divided by 
the total volume of the catalyst(s) in liters.
* * * * *

0
76. Section 86.1823-08 is amended by revising the definition of ``R'' 
in paragraph (d)(3) to read as follows:


Sec.  86.1823-08  Durability demonstration procedures for exhaust 
emissions.

* * * * *
    (d) * * *
    (3) * * *
    R = Catalyst thermal reactivity coefficient. You may use a default 
value of 17,500 for the SBC.
* * * * *

0
77. Section 86.1838-01 is amended by revising paragraph (b)(1)(i)(B), 
adding paragraph (b)(1)(i)(C), and revising paragraph (d)(3)(iii) 
introductory text to read as follows:


Sec.  86.1838-01  Small-volume manufacturer certification procedures.

* * * * *
    (b) * * *
    (1) * * *
    (i) * * *
    (B) No small-volume sales threshold applies for the heavy-duty 
greenhouse gas standards; alternative small-volume criteria apply as 
described in Sec.  86.1819-14(k)(5).
    (C) 15,000 units for all other requirements. See Sec.  86.1845 for 
separate provisions that apply for in-use testing.
* * * * *
    (d) * * *
    (3) * * *
    (iii) Notwithstanding the requirements of paragraph (d)(3)(ii) of 
this section, an applicant may satisfy the requirements of this 
paragraph (d)(3) if the requirements of this paragraph (d)(3) are 
completed by an auditor who is an employee of the applicant, provided 
that such employee:
* * * * *

0
78. Section 86.1844-01 is amended by revising paragraph (d)(4)(ii) and 
adding paragraph (d)(7)(iv) to read as follows:


Sec.  86.1844-01  Information requirements: Application for 
certification and submittal of information upon request.

* * * * *
    (d) * * *
    (4) * * *
    (ii) The equivalency factor required to be calculated in Sec.  
86.1823-08(e)(1)(iii)(B), when applicable.
* * * * *
    (7) * * *
    (iv) For heavy-duty vehicles subject to air conditioning standards 
under Sec.  86.1819, include the refrigerant leakage rates (leak 
scores), describe the type of refrigerant, and identify the refrigerant 
capacity of the air conditioning systems. If another company will 
install the air conditioning system, also identify the corporate name 
of the final installer.
* * * * *

0
79. Section 86.1845-04 is amended by revising paragraph (f)(1) to read 
as follows:


Sec.  86.1845-04   Manufacturer in-use verification testing 
requirements.

* * * * *
    (f)(1) A manufacturer must conduct in-use testing on a test group 
by determining NMOG exhaust emissions using the same methodology used 
for certification, as described in Sec.  86.1810-01(o) or 40 CFR 
1066.635.
* * * * *

0
80. Section 86.1846-01 is amended by revising paragraph (b)(1)(i) to 
read as follows:


Sec.  86.1846-01  Manufacturer in-use confirmatory testing 
requirements.

* * * * *
    (b) * * *
    (1) * * *
    (i) Additional testing is not required under this paragraph (b)(1) 
based on evaporative/refueling testing or based on low-mileage 
Supplemental FTP testing conducted under Sec.  86.1845-04(b)(5)(i). 
Testing conducted at high altitude under the requirements of Sec.  
86.1845-04(c) will be included in determining if a test group meets the 
criteria triggering the testing required under this section.
* * * * *

0
81. Section 86.1848-10 is amended by revising paragraph (c)(9) to read 
as follows:


Sec.  86.1848-10  Compliance with emission standards for the purpose of 
certification.

* * * * *
    (c) * * *
    (9) For 2012 and later model year LDVs, LDTs, and MDPVs, all 
certificates of conformity issued are conditional upon compliance with 
all provisions of Sec. Sec.  86.1818 and 86.1865 both during and after 
model year production. Similarly, for 2014 and later model year HDV, 
and other HDV subject to standards under Sec.  86.1819, all 
certificates of conformity issued are conditional upon compliance with 
all provisions of Sec. Sec.  86.1819 and 86.1865 both during and after 
model year production. The manufacturer bears the burden of 
establishing to the satisfaction of the Administrator that the terms 
and conditions upon which the certificate(s) was (were) issued were 
satisfied. For recall and warranty purposes, vehicles not covered by a 
certificate of conformity will continue to be held to the standards 
stated or referenced in the certificate that

[[Page 73992]]

otherwise would have applied to the vehicles.
    (i) Failure to meet the fleet average CO2 requirements 
will be considered a failure to satisfy the terms and conditions upon 
which the certificate(s) was (were) issued and the vehicles sold in 
violation of the fleet average CO2 standard will not be 
covered by the certificate(s). The vehicles sold in violation will be 
determined according to Sec.  86.1865-12(k)(8).
    (ii) Failure to comply fully with the prohibition against selling 
credits that are not generated or that are not available, as specified 
in Sec.  86.1865-12, will be considered a failure to satisfy the terms 
and conditions upon which the certificate(s) was (were) issued and the 
vehicles sold in violation of this prohibition will not be covered by 
the certificate(s).
    (iii) For manufacturers using the conditional exemption under Sec.  
86.1801-12(k), failure to fully comply with the fleet production 
thresholds that determine eligibility for the exemption will be 
considered a failure to satisfy the terms and conditions upon which the 
certificate(s) was (were) issued and the vehicles sold in violation of 
the stated sales and/or production thresholds will not be covered by 
the certificate(s).
    (iv) For manufacturers that are determined to be operationally 
independent under Sec.  86.1838-01(d), failure to report a material 
change in their status within 60 days as required by Sec.  86.1838-
01(d)(2) will be considered a failure to satisfy the terms and 
conditions upon which the certificate(s) was (were) issued and the 
vehicles sold in violation of the operationally independent criteria 
will not be covered by the certificate(s).
    (v) For manufacturers subject to an alternative fleet average 
greenhouse gas emission standard approved under Sec.  86.1818-12(g), 
failure to comply with the annual sales thresholds that are required to 
maintain use of those standards, including the thresholds required for 
new entrants into the U.S. market, will be considered a failure to 
satisfy the terms and conditions upon which the certificate(s) was 
(were) issued and the vehicles sold in violation of stated sales and/or 
production thresholds will not be covered by the certificate(s).
* * * * *

0
82. Section 86.1853-01 is revised to read as follows:


Sec.  86.1853-01  Certification hearings.

    If a manufacturer's request for a hearing is approved, EPA will 
follow the hearing procedures specified in 40 CFR part 1068, subpart G.

0
83. Section 86.1862-04 is amended by revising paragraph (d) to read as 
follows:


Sec.  86.1862-04  Maintenance of records and submittal of information 
relevant to compliance with fleet-average standards.

* * * * *
    (d) Notice of opportunity for hearing. Any voiding of the 
certificate under paragraph (a)(6) of this section will be made only 
after EPA has offered the manufacturer concerned an opportunity for a 
hearing conducted in accordance with 40 CFR part 1068, subpart G and, 
if a manufacturer requests such a hearing, will be made only after an 
initial decision by the Presiding Officer.


Sec.  86.1863-07   [Amended]

0
84. Section 86.1863-07 is amended by removing and reserving paragraph 
(h).

0
85. Section 86.1865-12 is revised to read as follows:


Sec.  86.1865-12   How to comply with the fleet average CO2 
standards.

    (a) Applicability. (1) Unless otherwise exempted under the 
provisions of paragraph (d) of this section, CO2 fleet 
average exhaust emission standards of this subpart apply to:
    (i) 2012 and later model year passenger automobiles and light 
trucks.
    (ii) Heavy-duty vehicles subject to standards under Sec.  86.1819.
    (iii) Vehicles imported by ICIs as defined in 40 CFR 85.1502.
    (2) The terms ``passenger automobile'' and ``light truck'' as used 
in this section have the meanings given in Sec.  86.1818-12.
    (b) Useful life requirements. Full useful life requirements for 
CO2 standards are defined in Sec. Sec.  86.1818 and 86.1819. 
There is not an intermediate useful life standard for CO2 
emissions.
    (c) Altitude. Greenhouse gas emission standards apply for testing 
at both low-altitude conditions and at high-altitude conditions, as 
described in Sec. Sec.  86.1818 and 86.1819.
    (d) Small volume manufacturer certification procedures. (1) 
Passenger automobiles and light trucks. Certification procedures for 
small volume manufacturers are provided in Sec.  86.1838. Small 
businesses meeting certain criteria may be exempted from the greenhouse 
gas emission standards in Sec.  86.1818 according to the provisions of 
Sec.  86.1801-12(j) or (k).
    (2) Heavy-duty vehicles. HDV manufacturers that qualify as small 
businesses are not subject to the Phase 1 greenhouse gas standards of 
this subpart as specified in Sec.  86.1819-14(k)(5).
    (e) CO2 fleet average exhaust emission standards. The fleet average 
standards referred to in this section are the corporate fleet average 
CO2 standards for passenger automobiles and light trucks set 
forth in Sec.  86.1818-12(c) and (e), and for HDV in Sec.  86.1819. 
Each manufacturer must comply with the applicable CO2 fleet 
average standard on a production-weighted average basis, for each 
separate averaging set, at the end of each model year, using the 
procedure described in paragraph (j) of this section. The fleet average 
CO2 standards applicable in a given model year are 
calculated separately for passenger automobiles and light trucks for 
each manufacturer and each model year according to the provisions in 
Sec.  86.1818. Calculate the HDV fleet average CO2 standard 
in a given model year as described in Sec.  86.1819-14(a).
    (f) In-use CO2 standards. In-use CO2 exhaust emission 
standards are provided in Sec.  86.1818-12(d) for passenger automobiles 
and light trucks and in Sec.  86.1819-14(b) for HDV.
    (g) Durability procedures and method of determining deterioration 
factors (DFs). Deterioration factors for CO2 exhaust 
emission standards are provided in Sec.  86.1823-08(m) for passenger 
automobiles and light trucks and in Sec.  86.1819-14(d)(5) for HDV.
    (h) Vehicle test procedures. (1) The test procedures for 
demonstrating compliance with CO2 exhaust emission standards 
are described at Sec.  86.101 and 40 CFR part 600, subpart B.
    (2) Testing to determine compliance with CO2 exhaust 
emission standards must be on a loaded vehicle weight (LVW) basis for 
passenger automobiles and light trucks (including MDPV), and on an 
adjusted loaded vehicle weight (ALVW) basis for non-MDPV heavy-duty 
vehicles.
    (3) Testing for the purpose of providing certification data is 
required only at low-altitude conditions. If hardware and software 
emission control strategies used during low-altitude condition testing 
are not used similarly across all altitudes for in-use operation, the 
manufacturer must include a statement in the application for 
certification, in accordance with Sec.  86.1844-01(d)(11), stating what 
the different strategies are and why they are used.
    (i) Calculating fleet average carbon-related exhaust emissions for 
passenger automobiles and light trucks. (1) Manufacturers must compute 
separate production-weighted fleet average carbon-related exhaust 
emissions at the end of the model year for passenger automobiles and 
light trucks, using actual production, where production means vehicles 
produced and delivered for sale, and certifying model types to

[[Page 73993]]

standards as defined in Sec.  86.1818-12. The model type carbon-related 
exhaust emission results determined according to 40 CFR part 600, 
subpart F (in units of grams per mile rounded to the nearest whole 
number) become the certification standard for each model type.
    (2) Manufacturers must separately calculate production-weighted 
fleet average carbon-related exhaust emissions levels for the following 
averaging sets according to the provisions of 40 CFR part 600, subpart 
F:
    (i) Passenger automobiles subject to the fleet average 
CO2 standards specified in Sec.  86.1818-12(c)(2);
    (ii) Light trucks subject to the fleet average CO2 
standards specified in Sec.  86.1818-12(c)(3);
    (iii) Passenger automobiles subject to the Temporary Leadtime 
Allowance Alternative Standards specified in Sec.  86.1818-12(e), if 
applicable; and
    (iv) Light trucks subject to the Temporary Leadtime Allowance 
Alternative Standards specified in Sec.  86.1818-12(e), if applicable.
    (j) Certification compliance and enforcement requirements for CO 2 
exhaust emission standards.
    (1) Compliance and enforcement requirements are provided in this 
section and Sec.  86.1848-10(c)(9).
    (2) The certificate issued for each test group requires all model 
types within that test group to meet the in-use emission standards to 
which each model type is certified. The in-use standards for passenger 
automobiles and light duty trucks (including MDPV) are described in 
Sec.  86.1818-12(d). The in-use standards for non-MDPV heavy-duty 
vehicles are described in Sec.  86.1819-14(b).
    (3) Each manufacturer must comply with the applicable 
CO2 fleet average standard on a production-weighted average 
basis, at the end of each model year. Use the procedure described in 
paragraph (i) of this section for passenger automobiles and light 
trucks (including MDPV). Use the procedure described in Sec.  86.1819-
14(d)(9)(iv) for non-MDPV heavy-duty vehicles.
    (4) Each manufacturer must comply on an annual basis with the fleet 
average standards as follows:
    (i) Manufacturers must report in their annual reports to the Agency 
that they met the relevant corporate average standard by showing that 
the applicable production-weighted average CO2 emission 
levels are at or below the applicable fleet average standards; or
    (ii) If the production-weighted average is above the applicable 
fleet average standard, manufacturers must obtain and apply sufficient 
CO2 credits as authorized under paragraph (k)(8) of this 
section. A manufacturer must show that they have offset any exceedance 
of the corporate average standard via the use of credits. Manufacturers 
must also include their credit balances or deficits in their annual 
report to the Agency.
    (iii) If a manufacturer fails to meet the corporate average 
CO2 standard for four consecutive years, the vehicles 
causing the corporate average exceedance will be considered not covered 
by the certificate of conformity (see paragraph (k)(8) of this 
section). A manufacturer will be subject to penalties on an individual-
vehicle basis for sale of vehicles not covered by a certificate.
    (iv) EPA will review each manufacturer's production to designate 
the vehicles that caused the exceedance of the corporate average 
standard. EPA will designate as nonconforming those vehicles in test 
groups with the highest certification emission values first, continuing 
until reaching a number of vehicles equal to the calculated number of 
noncomplying vehicles as determined in paragraph (k)(8) of this 
section. In a group where only a portion of vehicles would be deemed 
nonconforming, EPA will determine the actual nonconforming vehicles by 
counting backwards from the last vehicle produced in that test group. 
Manufacturers will be liable for penalties for each vehicle sold that 
is not covered by a certificate.
    (k) Requirements for the CO2 averaging, banking and trading (ABT) 
program. (1) A manufacturer whose CO2 fleet average 
emissions exceed the applicable standard must complete the calculation 
in paragraph (k)(4) of this section to determine the size of its 
CO2 deficit. A manufacturer whose CO2 fleet 
average emissions are less than the applicable standard may complete 
the calculation in paragraph (k)(4) of this section to generate 
CO2 credits. In either case, the number of credits or debits 
must be rounded to the nearest whole number.
    (2) There are no property rights associated with CO2 
credits generated under this subpart. Credits are a limited 
authorization to emit the designated amount of emissions. Nothing in 
this part or any other provision of law should be construed to limit 
EPA's authority to terminate or limit this authorization through a 
rulemaking.
    (3) Each manufacturer must comply with the reporting and 
recordkeeping requirements of paragraph (l) of this section for 
CO2 credits, including early credits. The averaging, banking 
and trading program is enforceable through the certificate of 
conformity that allows the manufacturer to introduce any regulated 
vehicles into U.S. commerce.
    (4) Credits are earned on the last day of the model year. 
Manufacturers must calculate, for a given model year and separately for 
passenger automobiles, light trucks, and heavy-duty vehicles, the 
number of credits or debits it has generated according to the following 
equation rounded to the nearest megagram:

CO2 Credits or Debits (Mg) = [(CO2 Standard - Manufacturer's 
Production-Weighted Fleet Average CO2 Emissions) x (Total Number of 
Vehicles Produced) x (Mileage)] / 1,000,000

Where:

CO2 Standard = the applicable standard for the model year as 
determined in Sec.  86.1818 or Sec.  86.1819;
Manufacturer's Production-Weighted Fleet Average CO2 Emissions = 
average calculated according to paragraph (i) of this section;
Total Number of Vehicles Produced = the number of vehicles 
domestically produced plus those imported as defined in Sec.  
600.511-08 of this chapter; and
Mileage = useful life value (in miles) for HDV, and vehicle lifetime 
miles of 195,264 for passenger automobiles and 225,865 for light 
trucks.

    (5) Determine total HDV debits and credits for a model year as 
described in Sec.  86.1819-14(d)(6). Determine total passenger car and 
light truck debits and credits for a model year as described in this 
paragraph (k)(5). Total credits or debits generated in a model year, 
maintained and reported separately for passenger automobiles and light 
trucks, shall be the sum of the credits or debits calculated in 
paragraph (k)(4) of this section and any of the following credits, if 
applicable, minus any CO2-equivalent debits for 
N2O and/or CH4 calculated according to the 
provisions of Sec.  86.1818-12(f)(4):
    (i) Air conditioning leakage credits earned according to the 
provisions of Sec.  86.1867-12(b).
    (ii) Air conditioning efficiency credits earned according to the 
provisions of Sec.  86.1868-12(c).
    (iii) Off-cycle technology credits earned according to the 
provisions of Sec.  86.1869-12(d).
    (iv) Full size pickup truck credits earned according to the 
provisions of Sec.  86.1870-12(c).
    (v) CO2-equivalent debits for N2O and/or 
CH4 accumulated according to the provisions of Sec.  
86.1818-12(f)(4).
    (6) Unused CO2 credits generally retain their full value 
through five model years after the model year in which they were 
generated. Credits remaining at the end of the fifth model

[[Page 73994]]

year after the model year in which they were generated may not be used 
to demonstrate compliance for later model years. The following 
particular provisions apply for passenger cars and light trucks:
    (i) Unused CO2 credits from the 2009 model year shall 
retain their full value through the 2014 model year. Credits from the 
2009 model year that remain at the end of the 2014 model year may not 
be used to demonstrate compliance for later model years.
    (ii) Unused CO2 credits from the 2010 through 2015 model 
years shall retain their full value through the 2021 model year. 
Credits remaining from these model years at the end of the 2021 model 
year may not be used to demonstrate compliance for later model years.
    (7) Credits may be used as follows:
    (i) Credits generated and calculated according to the method in 
paragraphs (k)(4) and (5) of this section may not be used to offset 
deficits other than those deficits accrued within the respective 
averaging set, except that credits may be transferred between the 
passenger automobile and light truck fleets of a given manufacturer. 
Credits may be banked and used in a future model year in which a 
manufacturer's average CO2 level exceeds the applicable 
standard. Credits may also be traded to another manufacturer according 
to the provisions in paragraph (k)(8) of this section. Before trading 
or carrying over credits to the next model year, a manufacturer must 
apply available credits to offset any deficit, where the deadline to 
offset that credit deficit has not yet passed. This paragraph (k)(7)(i) 
applies for MDPV, but not for other HDV.
    (ii) The use of credits shall not change Selective Enforcement 
Auditing or in-use testing failures from a failure to a non-failure. 
The enforcement of the averaging standard occurs through the vehicle's 
certificate of conformity as described in paragraph (k)(8) of this 
section. A manufacturer's certificate of conformity is conditioned upon 
compliance with the averaging provisions. The certificate will be void 
ab initio if a manufacturer fails to meet the corporate average 
standard and does not obtain appropriate credits to cover its 
shortfalls in that model year or subsequent model years (see deficit 
carry-forward provisions in paragraph (k)(8) of this section).
    (iii) The following provisions apply for passenger automobiles and 
light trucks under the Temporary Leadtime Allowance Alternative 
Standards:
    (A) Credits generated by vehicles subject to the fleet average 
CO2 standards specified in Sec.  86.1818-12(c) may only be 
used to offset a deficit generated by vehicles subject to the Temporary 
Leadtime Allowance Alternative Standards specified in Sec.  86.1818-
12(e).
    (B) Credits generated by a passenger automobile or light truck 
averaging set subject to the Temporary Leadtime Allowance Alternative 
Standards specified in Sec.  86.1818-12(e)(4)(i) or (ii) may be used to 
offset a deficit generated by an averaging set subject to the Temporary 
Leadtime Allowance Alternative Standards through the 2015 model year, 
except that manufacturers qualifying under the provisions of Sec.  
86.1818-12(e)(3) may use such credits to offset a deficit generated by 
an averaging set subject to the Temporary Leadtime Allowance 
Alternative Standards through the 2016 model year.
    (C) Credits generated by an averaging set subject to the Temporary 
Leadtime Allowance Alternative Standards specified in Sec.  86.1818-
12(e)(4)(i) or (ii) of this section may not be used to offset a deficit 
generated by an averaging set subject to the fleet average 
CO2 standards specified in Sec.  86.1818-12(c)(2) or (3) or 
otherwise transferred to an averaging set subject to the fleet average 
CO2 standards specified in Sec.  86.1818-12(c)(2) or (3).
    (D) Credits generated by vehicles subject to the Temporary Leadtime 
Allowance Alternative Standards specified in Sec.  86.1818-12(e)(4)(i) 
or (ii) may be banked for use in a future model year (to offset a 
deficit generated by an averaging set subject to the Temporary Leadtime 
Allowance Alternative Standards). All such credits may not be used to 
demonstrate compliance for model year 2016 and later vehicles, except 
that manufacturers qualifying under the provisions of Sec.  86.1818-
12(e)(3) may use such credits to offset a deficit generated by an 
averaging set subject to the Temporary Leadtime Allowance Alternative 
Standards through the 2016 model year.
    (E) A manufacturer with any vehicles subject to the Temporary 
Leadtime Allowance Alternative Standards specified in Sec.  86.1818-
12(e)(4)(i) or (ii) of this section in a model year in which that 
manufacturer also generates credits with vehicles subject to the fleet 
average CO2 standards specified in Sec.  86.1818-12(c) may 
not trade or bank credits earned against the fleet average standards in 
Sec.  86.1818-12(c) for use in a future model year.
    (iv) Credits generated in the 2017 through 2020 model years under 
the provisions of Sec.  86.1818-12(e)(3)(ii) may not be traded or 
otherwise provided to another manufacturer.
    (v) Credits generated under any alternative fleet average standards 
approved under Sec.  86.1818-12(g) may not be traded or otherwise 
provided to another manufacturer.
    (8) The following provisions apply if a manufacturer calculates 
that it has negative credits (also called ``debits'' or a ``credit 
deficit'') for a given model year:
    (i) The manufacturer may carry the credit deficit forward into the 
next three model years. Such a carry-forward may only occur after the 
manufacturer exhausts any supply of banked credits. The deficit must be 
covered with an appropriate number of credits that the manufacturer 
generates or purchases by the end of the third model year. Any 
remaining deficit is subject to a voiding of the certificate ab initio, 
as described in this paragraph (k)(8). Manufacturers are not permitted 
to have a credit deficit for four consecutive years.
    (ii) If the credit deficit is not offset within the specified time 
period, the number of vehicles not meeting the fleet average 
CO2 standards (and therefore not covered by the certificate) 
must be calculated.
    (A) Determine the negative credits for the noncompliant vehicle 
category by multiplying the total megagram deficit by 1,000,000 and 
then dividing by the mileage specified in paragraph (k)(4) of this 
section.
    (B) Divide the result by the fleet average standard applicable to 
the model year in which the debits were first incurred and round to the 
nearest whole number to determine the number of vehicles not meeting 
the fleet average CO2 standards.
    (iii) EPA will determine the vehicles not covered by a certificate 
because the condition on the certificate was not satisfied by 
designating vehicles in those test groups with the highest carbon-
related exhaust emission values first and continuing until reaching a 
number of vehicles equal to the calculated number of non-complying 
vehicles as determined in this paragraph (k)(8). The same approach 
applies for HDV, except that EPA will make these designations by 
ranking test groups based on CO2 emission values. If these 
calculations determines that only a portion of vehicles in a test group 
contribute to the debit situation, then EPA will designate actual 
vehicles in that test group as not covered by the certificate, starting 
with the last vehicle produced and counting backwards.
    (iv)(A) If a manufacturer ceases production of passenger 
automobiles, light trucks, or heavy-duty vehicles, the manufacturer 
continues to be responsible for offsetting any debits

[[Page 73995]]

outstanding within the required time period. Any failure to offset the 
debits will be considered a violation of paragraph (k)(8)(i) of this 
section and may subject the manufacturer to an enforcement action for 
sale of vehicles not covered by a certificate, pursuant to paragraphs 
(k)(8)(ii) and (iii) of this section.
    (B) If a manufacturer is purchased by, merges with, or otherwise 
combines with another manufacturer, the controlling entity is 
responsible for offsetting any debits outstanding within the required 
time period. Any failure to offset the debits will be considered a 
violation of paragraph (k)(8)(i) of this section and may subject the 
manufacturer to an enforcement action for sale of vehicles not covered 
by a certificate, pursuant to paragraphs (k)(8)(ii) and (iii) of this 
section.
    (v) For purposes of calculating the statute of limitations, a 
violation of the requirements of paragraph (k)(8)(i) of this section, a 
failure to satisfy the conditions upon which a certificate(s) was 
issued and hence a sale of vehicles not covered by the certificate, all 
occur upon the expiration of the deadline for offsetting debits 
specified in paragraph (k)(8)(i) of this section.
    (9) The following provisions apply to CO2 credit 
trading:
    (i) EPA may reject CO2 credit trades if the involved 
manufacturers fail to submit the credit trade notification in the 
annual report.
    (ii) A manufacturer may not sell credits that are no longer valid 
for demonstrating compliance based on the model years of the subject 
vehicles, as specified in paragraph (k)(6) of this section.
    (iii) In the event of a negative credit balance resulting from a 
transaction, both the buyer and seller are liable for the credit 
shortfall. EPA may void ab initio the certificates of conformity of all 
test groups that generate or use credits in such a trade.
    (iv)(A) If a manufacturer trades a credit that it has not generated 
pursuant to this paragraph (k) or acquired from another party, the 
manufacturer will be considered to have generated a debit in the model 
year that the manufacturer traded the credit. The manufacturer must 
offset such debits by the deadline for the annual report for that same 
model year.
    (B) Failure to offset the debits within the required time period 
will be considered a failure to satisfy the conditions upon which the 
certificate(s) was issued and will be addressed pursuant to paragraph 
(k)(8) of this section.
    (v) A manufacturer may only trade credits that it has generated 
pursuant to paragraphs (k)(4) and (5) of this section or acquired from 
another party.
    (l) Maintenance of records and submittal of information relevant to 
compliance with fleet average CO2 standards--(1) Maintenance of 
records. (i) Manufacturers producing any light-duty vehicles, light-
duty trucks, medium-duty passenger vehicles, or other heavy-duty 
vehicles subject to the provisions in this subpart must establish, 
maintain, and retain all the following information in adequately 
organized records for each model year:
    (A) Model year.
    (B) Applicable fleet average CO2 standards for each 
averaging set as defined in paragraph (i) of this section.
    (C) The calculated fleet average CO2 value for each 
averaging set as defined in paragraph (i) of this section.
    (D) All values used in calculating the fleet average CO2 
values.
    (ii) Manufacturers must establish, maintain, and retain all the 
following information in adequately organized records for each vehicle 
produced that is subject to the provisions in this subpart:
    (A) Model year.
    (B) Applicable fleet average CO2 standard.
    (C) EPA test group.
    (D) Assembly plant.
    (E) Vehicle identification number.
    (F) Carbon-related exhaust emission standard (automobile and light 
truck only), N2O emission standard, and CH4 
emission standard to which the vehicle is certified.
    (G) In-use carbon-related exhaust emission standard for passenger 
automobiles and light truck, and in-use CO2 standard for 
HDV.
    (H) Information on the point of first sale, including the 
purchaser, city, and state.
    (iii) Manufacturers must retain all required records for a period 
of eight years from the due date for the annual report. Records may be 
stored in any format and on any media, as long as manufacturers can 
promptly send EPA organized written records in English if requested by 
the Administrator. Manufacturers must keep records readily available as 
EPA may review them at any time.
    (iv) The Administrator may require the manufacturer to retain 
additional records or submit information not specifically required by 
this section.
    (v) Pursuant to a request made by the Administrator, the 
manufacturer must submit to the Administrator the information that the 
manufacturer is required to retain.
    (vi) EPA may void ab initio a certificate of conformity for 
vehicles certified to emission standards as set forth or otherwise 
referenced in this subpart for which the manufacturer fails to retain 
the records required in this section or to provide such information to 
the Administrator upon request, or to submit the reports required in 
this section in the specified time period.
    (2) Reporting. (i) Each manufacturer must submit an annual report. 
The annual report must contain for each applicable CO2 
standard, the calculated fleet average CO2 value, all values 
required to calculate the CO2 emissions value, the number of 
credits generated or debits incurred, all the values required to 
calculate the credits or debits, and the resulting balance of credits 
or debits. For each applicable alternative N2O and/or 
CH4 standard selected under the provisions of Sec.  86.1818-
12(f)(3) for passenger automobiles and light trucks (or Sec.  86.1819-
14(c) for HDV), the report must contain the CO2-equivalent 
debits for N2O and/or CH4 calculated according to 
Sec.  86.1818-12(f)(4) (or Sec.  86.1819-14(c) for HDV) for each test 
group and all values required to calculate the number of debits 
incurred.
    (ii) For each applicable fleet average CO2 standard, the 
annual report must also include documentation on all credit 
transactions the manufacturer has engaged in since those included in 
the last report. Information for each transaction must include all of 
the following:
    (A) Name of credit provider.
    (B) Name of credit recipient.
    (C) Date the trade occurred.
    (D) Quantity of credits traded in megagrams.
    (E) Model year in which the credits were earned.
    (iii) Manufacturers calculating air conditioning leakage and/or 
efficiency credits under paragraph Sec.  86.1871-12(b) shall include 
the following information for each model year and separately for 
passenger automobiles and light trucks and for each air conditioning 
system used to generate credits:
    (A) A description of the air conditioning system.
    (B) The leakage credit value and all the information required to 
determine this value.
    (C) The total credits earned for each averaging set, model year, 
and region, as applicable.
    (iv) Manufacturers calculating advanced technology vehicle credits 
under paragraph Sec.  86.1871-12(c) shall include the following 
information for each model year and separately for passenger 
automobiles and light trucks:

[[Page 73996]]

    (A) The number of each model type of eligible vehicle sold.
    (B) The cumulative model year production of eligible vehicles 
starting with the 2009 model year.
    (C) The carbon-related exhaust emission value by model type and 
model year.
    (v) Manufacturers calculating off-cycle technology credits under 
paragraph Sec.  86.1871-12(d) shall include, for each model year and 
separately for passenger automobiles and light trucks, all test results 
and data required for calculating such credits.
    (vi) Unless a manufacturer reports the data required by this 
section in the annual production report required under Sec.  86.1844-
01(e) or the annual report required under Sec.  600.512-12 of this 
chapter, a manufacturer must submit an annual report for each model 
year after production ends for all affected vehicles produced by the 
manufacturer subject to the provisions of this subpart and no later 
than May 1 of the calendar year following the given model year. Annual 
reports must be submitted to: Director, Compliance Division, U.S. 
Environmental Protection Agency, 2000 Traverwood Dr., Ann Arbor, 
Michigan 48105.
    (vii) Failure by a manufacturer to submit the annual report in the 
specified time period for all vehicles subject to the provisions in 
this section is a violation of section 203(a)(1) of the Clean Air Act 
(42 U.S.C. 7522 (a)(1)) for each applicable vehicle produced by that 
manufacturer.
    (viii) If EPA or the manufacturer determines that a reporting error 
occurred on an annual report previously submitted to EPA, the 
manufacturer's credit or debit calculations will be recalculated. EPA 
may void erroneous credits, unless traded, and will adjust erroneous 
debits. In the case of traded erroneous credits, EPA must adjust the 
selling manufacturer's credit balance to reflect the sale of such 
credits and any resulting credit deficit.
    (3) Notice of opportunity for hearing. Any voiding of the 
certificate under paragraph (l)(1)(vi) of this section will be made 
only after EPA has offered the affected manufacturer an opportunity for 
a hearing conducted in accordance with 40 CFR part 1068, subpart G, 
and, if a manufacturer requests such a hearing, will be made only after 
an initial decision by the Presiding Officer.

0
86. Section 86.1866-12 is amended by adding introductory text and 
revising paragraph (b) introductory text to read as follows:


Sec.  86.1866-12   CO2 credits for advanced technology 
vehicles.

    This section describes how to apply CO2 credits for 
advanced technology passenger automobiles and light trucks (including 
MDPV). This section does not apply for heavy-duty vehicles that are not 
MDPV.
* * * * *
    (b) For electric vehicles, plug-in hybrid electric vehicles, fuel 
cell vehicles, dedicated natural gas vehicles, and dual-fuel natural 
gas vehicles as those terms are defined in Sec.  86.1803-01, that are 
certified and produced for U.S. sale in the 2017 through 2021 model 
years and that meet the additional specifications in this section, the 
manufacturer may use the production multipliers in this paragraph (b) 
when determining the manufacturer's fleet average carbon-related 
exhaust emissions under Sec.  600.510-12 of this chapter. Full size 
pickup trucks eligible for and using a production multiplier are not 
eligible for the performance-based credits described in Sec.  86.1870-
12(b).
* * * * *

0
87. Section 86.1867-12 is amended by revising the introductory text to 
read as follows:


Sec.  86.1867-12   CO2 credits for reducing leakage of air 
conditioning refrigerant.

    Manufacturers may generate credits applicable to the CO2 
fleet average program described in Sec.  86.1865-12 by implementing 
specific air conditioning system technologies designed to reduce air 
conditioning refrigerant leakage over the useful life of their 
passenger automobiles and/or light trucks (including MDPV); only the 
provisions of paragraph (a) of this section apply for non-MDPV heavy-
duty vehicles. Credits shall be calculated according to this section 
for each air conditioning system that the manufacturer is using to 
generate CO2 credits. Manufacturers may also generate early 
air conditioning refrigerant leakage credits under this section for the 
2009 through 2011 model years according to the provisions of Sec.  
86.1871-12(b).
* * * * *

0
88. Section 86.1868-12 is amended by revising the introductory text and 
paragraphs (e)(5), (f)(1), (g)(1), and (g)(3) introductory text to read 
as follows:


Sec.  86.1868-12   CO2 credits for improving the efficiency 
of air conditioning systems.

    Manufacturers may generate credits applicable to the CO2 
fleet average program described in Sec.  86.1865-12 by implementing 
specific air conditioning system technologies designed to reduce air 
conditioning-related CO2 emissions over the useful life of 
their passenger automobiles and/or light trucks (including MDPV). The 
provisions of this section do not apply for non-MDPV heavy-duty 
vehicles. Credits shall be calculated according to this section for 
each air conditioning system that the manufacturer is using to generate 
CO2 credits. Manufacturers may also generate early air 
conditioning efficiency credits under this section for the 2009 through 
2011 model years according to the provisions of Sec.  86.1871-12(b). 
For model years 2012 and 2013 the manufacturer may determine air 
conditioning efficiency credits using the requirements in paragraphs 
(a) through (d) of this section. For model years 2014 through 2016 the 
eligibility requirements specified in either paragraph (e) or (f) of 
this section must be met before an air conditioning system is allowed 
to generate credits. For model years 2017 through 2019 the eligibility 
requirements specified in paragraph (f) of this section must be met 
before an air conditioning system is allowed to generate credits. For 
model years 2020 and later the eligibility requirements specified in 
paragraph (g) of this section must be met before an air conditioning 
system is allowed to generate credits.
* * * * *
    (e) * * *
    (5) Air conditioning systems with compressors that are solely 
powered by electricity shall submit Air Conditioning Idle Test 
Procedure data to be eligible to generate credits in the 2014 and later 
model years, but such systems are not required to meet a specific 
threshold to be eligible to generate such credits, as long as the 
engine remains off for a period of at least 2 cumulative minutes during 
the air conditioning on portion of the Idle Test Procedure in Sec.  
86.165-12(d).
    (f) * * *
    (1) The manufacturer shall perform the AC17 test specified in 40 
CFR 1066.845 on each unique air conditioning system design and vehicle 
platform combination (as those terms are defined in Sec.  86.1803) for 
which the manufacturer intends to accrue air conditioning efficiency 
credits. The manufacturer must test at least one unique air 
conditioning system within each vehicle platform in a model year, 
unless all unique air conditioning systems within a vehicle platform 
have been previously tested. A unique air conditioning system design is 
a system with unique or substantially different component designs or 
types and/or system control strategies (e.g., fixed

[[Page 73997]]

displacement vs. variable displacement compressors, orifice tube vs. 
thermostatic expansion valve, single vs. dual evaporator, etc.). In the 
first year of such testing, the tested vehicle configuration shall be 
the highest production vehicle configuration within each platform. In 
subsequent model years the manufacturer must test other unique air 
conditioning systems within the vehicle platform, proceeding from the 
highest production untested system until all unique air conditioning 
systems within the platform have been tested, or until the vehicle 
platform experiences a major redesign. Whenever a new unique air 
conditioning system is tested, the highest production configuration 
using that system shall be the vehicle selected for testing. Air 
conditioning system designs which have similar cooling capacity, 
component types, and control strategies, yet differ in terms of 
compressor pulley ratios or condenser or evaporator surface areas will 
not be considered to be unique system designs. The test results from 
one unique system design may represent all variants of that design. 
Manufacturers must use good engineering judgment to identify the unique 
air conditioning system designs which will require AC17 testing in 
subsequent model years. Results must be reported separately for all 
four phases (two phases with air conditioning off and two phases with 
air conditioning on) of the test to the Environmental Protection 
Agency, and the results of the calculations required in 40 CFR 1066.845 
must also be reported. In each subsequent model year additional air 
conditioning system designs, if such systems exist, within a vehicle 
platform that is generating air conditioning credits must be tested 
using the AC17 procedure. When all unique air conditioning system 
designs within a platform have been tested, no additional testing is 
required within that platform, and credits may be carried over to 
subsequent model years until there is a significant change in the 
platform design, at which point a new sequence of testing must be 
initiated. No more than one vehicle from each credit-generating 
platform is required to be tested in each model year.
* * * * *
    (g) * * *
    (1) For each air conditioning system (as defined in Sec.  86.1803) 
selected by the manufacturer to generate air conditioning efficiency 
credits, the manufacturer shall perform the AC17 Air Conditioning 
Efficiency Test Procedure specified in 40 CFR 1066.845, according to 
the requirements of this paragraph (g).
* * * * *
    (3) For the first model year for which an air conditioning system 
is expected to generate credits, the manufacturer must select for 
testing the projected highest-selling configuration within each 
combination of vehicle platform and air conditioning system (as those 
terms are defined in Sec.  86.1803). The manufacturer must test at 
least one unique air conditioning system within each vehicle platform 
in a model year, unless all unique air conditioning systems within a 
vehicle platform have been previously tested. A unique air conditioning 
system design is a system with unique or substantially different 
component designs or types and/or system control strategies (e.g., 
fixed-displacement vs. variable displacement compressors, orifice tube 
vs. thermostatic expansion valve, single vs. dual evaporator, etc.). In 
the first year of such testing, the tested vehicle configuration shall 
be the highest production vehicle configuration within each platform. 
In subsequent model years the manufacturer must test other unique air 
conditioning systems within the vehicle platform, proceeding from the 
highest production untested system until all unique air conditioning 
systems within the platform have been tested, or until the vehicle 
platform experiences a major redesign. Whenever a new unique air 
conditioning system is tested, the highest production configuration 
using that system shall be the vehicle selected for testing. Credits 
may continue to be generated by the air conditioning system installed 
in a vehicle platform provided that:
* * * * *

0
89. Section 86.1869-12 is amended by adding introductory text and 
revising paragraphs (b)(2) introductory text, (b)(4)(ii), and (f) to 
read as follows:


Sec.  86.1869-12  CO2 credits for off-cycle CO2-
reducing technologies.

    This section describes how manufacturers may generate credits for 
off-cycle CO2-reducing technologies. The provisions of this 
section do not apply for non-MDPV heavy-duty vehicles, except that 
Sec.  86.1819-14(d)(13) describes how to apply paragraphs (c) and (d) 
of this section for those vehicles.
* * * * *
    (b) * * *
    (2) The maximum allowable decrease in the manufacturer's combined 
passenger automobile and light truck fleet average CO2 
emissions attributable to use of the default credit values in paragraph 
(b)(1) of this section is 10 grams per mile. If the total of the 
CO2 g/mi credit values from paragraph (b)(1) of this section 
does not exceed 10 g/mi for any passenger automobile or light truck in 
a manufacturer's fleet, then the total off-cycle credits may be 
calculated according to paragraph (f) of this section. If the total of 
the CO2 g/mi credit values from paragraph (b)(1) of this 
section exceeds 10 g/mi for any passenger automobile or light truck in 
a manufacturer's fleet, then the gram per mile decrease for the 
combined passenger automobile and light truck fleet must be determined 
according to paragraph (b)(2)(i) of this section to determine whether 
the 10 g/mi limitation has been exceeded.
* * * * *
    (4) * * *
    (ii) High efficiency exterior lighting means a lighting technology 
that, when installed on the vehicle, is expected to reduce the total 
electrical demand of the exterior lighting system when compared to 
conventional lighting systems. To be eligible for this credit, the high 
efficiency lighting must be installed in one or more of the following 
lighting components: low beam, high beam, parking/position, front and 
rear turn signals, front and rear side markers, taillights, and/or 
license plate lighting.
* * * * *
    (f) Calculation of total off-cycle credits. Total off-cycle credits 
in Megagrams of CO2 (rounded to the nearest whole number) 
shall be calculated separately for passenger automobiles and light 
trucks according to the following formula:

Total Credits (Megagrams) = (Credit x Production x VLM) / 1,000,000

Where:

Credit = the credit value in grams per mile determined in paragraph 
(b), (c) or (d) of this section.
Production = The total number of passenger automobiles or light 
trucks, whichever is applicable, produced with the off-cycle 
technology to which to the credit value determined in paragraph (b), 
(c), or (d) of this section applies.
VLM = vehicle lifetime miles, which for passenger automobiles shall 
be 195,264 and for light trucks shall be 225,865.

0
90. Section 86.1870-12 is amended by revising the section heading, 
introductory text, and paragraph (a) introductory text and adding 
paragraph (a)(3) to read as follows:


Sec.  86.1870-12  CO2 credits for qualifying full-size light 
pickup trucks.

    Full-size pickup trucks may be eligible for additional credits 
based on the implementation of hybrid technologies or on exhaust 
emission

[[Page 73998]]

performance, as described in this section. Credits may be generated 
under either paragraph (a) or (b) of this section for a qualifying 
pickup truck, but not both. The provisions of this section do not apply 
for heavy-duty vehicles.
    (a) Credits for implementation of hybrid electric technology. Full 
size pickup trucks that implement hybrid electric technologies may be 
eligible for an additional credit under this paragraph (a). Pickup 
trucks earning the credits under this paragraph (a) may not earn the 
credits described in paragraph (b) of this section. To claim this 
credit, the manufacturer must measure the recovered energy over the 
Federal Test Procedure according to 40 CFR 600.116-12(d) to determine 
whether a vehicle is a mild or strong hybrid electric vehicle. To 
provide for EPA testing, the vehicle must be able to broadcast battery 
pack voltage via an on-board diagnostics parameter ID channel.
* * * * *
    (3) If you produce both mild and strong hybrid electric full size 
pickup trucks but do not qualify for credits under paragraph (a)(1) or 
(2) of this section, your hybrid electric full size pickup trucks may 
be eligible for a credit of 10 grams/mile. To receive this credit in a 
given model year, you must produce a quantity of hybrid electric full 
size pickup trucks such that the proportion of combined mild and strong 
full size hybrid electric pickup trucks produced in a model year, when 
compared to your total production of full size pickup trucks, is not 
less than the required minimum percentages specified in paragraph 
(a)(1) of this section.
* * * * *

0
91. Section 86.1871-12 is amended by revising the introductory text and 
paragraphs (a) introductory text, (b)(1), and (d) to read as follows:


Sec.  86.1871-12  Optional early CO2 credit programs.

    Manufacturers may optionally generate CO2 credits in the 
2009 through 2011 model years for use in the 2012 and later model years 
subject to EPA approval and to the provisions of this section. The 
provisions of Sec.  86.1819-14(k)(1) and (2) apply instead of the 
provisions of this section for non-MDPV heavy-duty vehicles. 
Manufacturers may generate early fleet average credits, air 
conditioning leakage credits, air conditioning efficiency credits, 
early advanced technology credits, and early off-cycle technology 
credits. Manufacturers generating any credits under this section must 
submit an early credits report to the Administrator as required in this 
section. The terms ``sales'' and ``sold'' as used in this section shall 
mean vehicles produced for U.S. sale, where ``U.S.'' means the states 
and territories of the United States. The expiration date of unused 
CO2 credits is based on the model year in which the credits 
are earned, as described in Sec.  86.1865-12(k)(6).
    (a) Early fleet average CO2 reduction credits. 
Manufacturers may optionally generate credits for reductions in their 
fleet average CO2 emissions achieved in the 2009 through 
2011 model years. To generate early fleet average CO2 
reduction credits, manufacturers must select one of the four pathways 
described in paragraphs (a)(1) through (4) of this section. The 
manufacturer may select only one pathway, and that pathway must remain 
in effect for the 2009 through 2011 model years. Fleet average credits 
(or debits) must be calculated and reported to EPA for each model year 
under each selected pathway.
* * * * *
    (b) Early air conditioning leakage and efficiency credits. (1) 
Manufacturers may optionally generate air conditioning refrigerant 
leakage credits according to the provisions of Sec.  86.1867 and/or air 
conditioning efficiency credits according to the provisions of Sec.  
86.1868 in model years 2009 through 2011. Credits must be tracked by 
model type and model year.
* * * * *
    (d) Early off-cycle technology credits. Manufacturers may 
optionally generate credits for the implementation of certain 
CO2-reducing technologies according to the provisions of 
Sec.  86.1869 in model years 2009 through 2011. Credits must be tracked 
by model type and model year.
* * * * *

Subpart T--Manufacturer-Run In-Use Testing Program for Heavy-Duty 
Diesel Engines

0
92. Section 86.1910 is amended by revising paragraph (i) to read as 
follows:


Sec.  86.1910  How must I prepare and test my in-use engines?

* * * * *
    (i) You may count a vehicle as meeting the vehicle-pass criteria 
described in Sec.  86.1912 if a shift day of testing or two-shift days 
of testing (with the requisite non-idle/idle operation time as in 
paragraph (g) of this section), or if the extended testing you elected 
under paragraph (h) of this section does not generate a single valid 
NTE sampling event, as described in Sec.  86.1912(b). Count the vehicle 
towards meeting your testing requirements under this subpart.
* * * * *

0
93. Section 86.1912 is revised to read as follows:


Sec.  86.1912  How do I determine whether an engine meets the vehicle-
pass criteria?

    In general, the average emissions for each regulated pollutant must 
remain at or below the NTE threshold in paragraph (a) of this section 
for at least 90 percent of the valid NTE sampling events, as defined in 
paragraph (b) of this section. For 2007 through 2009 model year 
engines, the average emissions from every NTE sampling event must also 
remain below the NTE thresholds in paragraph (g)(2) of this section. 
Perform the following steps to determine whether an engine meets the 
vehicle-pass criteria:
    (a) Determine the NTE threshold for each pollutant subject to an 
NTE standard by adding all three of the following terms and rounding 
the result to the same number of decimal places as the applicable NTE 
standard:
    (1) The applicable NTE standard.
    (2) The in-use compliance testing margin specified in Sec.  86.007-
11(h), if any.
    (3) An accuracy margin for portable in-use equipment when testing 
is performed under the special provisions of Sec.  86.1930, depending 
on the pollutant, as follows:
    (i) NMHC: 0.17 g/hp[middot]hr.
    (ii) CO: 0.60 g/hp[middot]hr.
    (iii) NOX: 0.50 g/hp[middot]hr.
    (iv) PM: 0.10 g/hp[middot]hr.
    (v) NOX + NMHC: 0.67 g/hp[middot]hr.
    (4) Accuracy margins for portable in-use equipment when testing is 
not performed under the special provisions of Sec.  86.1930 for 2007 
through 2009 model year engine families that are selected for testing 
in any calendar year as follows:
    (i) NMHC using the emission calculation method specified in 40 CFR 
1065.650(a)(1): 0.02 g/hp[middot]hr.
    (ii) NMHC using the emission calculation method specified in 40 CFR 
1065.650(a)(3): 0.01 g/hp[middot]hr.
    (iii) NMHC using an alternative emission calculation method we 
approve under 40 CFR 1065.915(d)(5)(iv): 0.01 g/hp[middot]hr.
    (iv) CO using the emission calculation method specified in 40 CFR 
1065.650(a)(1): 0.5 g/hp[middot]hr.
    (v) CO using the emission calculation method specified in 40 CFR 
1065.650(a)(3): 0.25 g/hp[middot]hr.
    (vi) CO using an alternative emission calculation method we approve 
under 40 CFR 1065.915(d)(5)(iv): 0.25 g/hp[middot]hr.

[[Page 73999]]

    (vii) NOX using the emission calculation method 
specified in 40 CFR 1065.650(a)(1): 0.45 g/hp[middot]hr.
    (viii) NOX using the emission calculation method 
specified in 40 CFR 1065.650(a)(3): 0.15 g/hp[middot]hr.
    (ix) NOX using an alternative emission calculation 
method we approve under 40 CFR 1065.915(d)(5)(iv): 0.15 g/hp[middot]hr.
    (x) NOX + NMHC using the emission calculation method 
specified in 40 CFR 1065.650(a)(1): 0.47 g/hp[middot]hr.
    (xi) NOX + NMHC using the emission calculation method 
specified in 40 CFR 1065.650(a)(3): 0.16 g/hp[middot]hr.
    (xii) NOX + NMHC using an alternative emission 
calculation method we approve under 40 CFR 1065.915(d)(5)(iv): 0.16 g/
hp[middot]hr.
    (xiii) PM: 0.006 g/hp[middot]hr.
    (5) Accuracy margins for portable in-use equipment when testing is 
not performed under the special provisions of Sec.  86.1930 for 2010 or 
later model year engines families that are selected for testing in any 
calendar year as follows:
    (i) NMHC using any emission calculation method specified in 40 CFR 
1065.650(a) or an alternative emission calculation method we approve 
under 40 CFR 1065.915(d)(5)(iv): 0.01 g/hp[middot]hr.
    (ii) CO using any emission calculation method specified in 40 CFR 
1065.650(a) or an alternative emission calculation method we approve 
under 40 CFR 1065.915(d)(5)(iv): 0.25 g/hp[middot]hr.
    (iii) NOX using any emission calculation method 
specified in 40 CFR 1065.650(a) or an alternative emission calculation 
method we approve under 40 CFR 1065.915(d)(5)(iv): 0.15 g/hp[middot]hr.
    (iv) PM: 0.006 g/hp[middot]hr.
    (b) For the purposes of this subpart, a valid NTE sampling event 
consists of at least 30 seconds of continuous operation in the NTE 
control area. An NTE event begins when the engine starts to operate in 
the NTE control area and continues as long as engine operation remains 
in this area (see Sec.  86.1370). When determining a valid NTE sampling 
event, exclude all engine operation in approved NTE limited testing 
regions under Sec.  86.1370-2007(b)(6) and any approved NTE 
deficiencies under Sec.  86.007-11(a)(4)(iv). Engine operation in the 
NTE control area of less than 30 contiguous seconds does not count as a 
valid NTE sampling event; operating periods of less than 30 seconds in 
the NTE control area, but outside of any allowed deficiency area or 
limited testing region, will not be added together to make a 30 second 
or longer event. Exclude any portion of a sampling event that would 
otherwise exceed the 5.0 percent limit for the time-weighted carve-out 
defined in Sec.  86.1370-2007(b)(7). For EGR-equipped engines, exclude 
any operation that occurs during the cold-temperature operation defined 
by the equations in Sec.  86.1370-2007(f)(1).
    (c) Calculate the average emission level for each pollutant over 
each valid NTE sampling event as specified in 40 CFR part 1065, subpart 
G, using each NTE event as an individual test interval. This should 
include valid NTE events from all days of testing.
    (d) If the engine has an open crankcase, account for these 
emissions by adding 0.00042 g/hp[middot]hr to the PM emission result 
for every NTE event.
    (e) Calculate a time-weighted vehicle-pass ratio (Rpass) 
for each pollutant. To do this, first sum the time from each valid NTE 
sampling event whose average emission level is at or below the NTE 
threshold for that pollutant, then divide this value by the sum of the 
engine operating time from all valid NTE events for that pollutant. 
Round the resulting vehicle-pass ratio to two decimal places.
    (1) Calculate the time-weighted vehicle-pass ratio for each 
pollutant as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.041

Where:

npass = the number of valid sampling events for which the 
average emission level is at or below the NTE threshold.
ntotal = the total number of valid NTE sampling events.

    (2) For both the numerator and the denominator of the vehicle-pass 
ratio, use the smallest of the following values for determining the 
duration, t, of any NTE sampling event:
    (i) The measured time in the NTE zone that is valid for an NTE 
sampling event.
    (ii) 600 seconds.
    (iii) 10 times the length of the shortest valid NTE sampling event 
for all testing with that engine.
    (f) The following example illustrates how to select the duration of 
NTE sampling events for calculations, as described in paragraph (f) of 
this section:

----------------------------------------------------------------------------------------------------------------
                                                                                                   Duration used
                                           Duration of                                                  in
               NTE sample                  NTE sample            Duration limit applied?           calculations
                                            (seconds)                                                (seconds)
----------------------------------------------------------------------------------------------------------------
1......................................              45  No.....................................              45
2......................................             168  No.....................................             168
3......................................             605  Yes. Use 10 times shortest valid NTE...             450
4......................................             490  Yes. Use 10 times shortest valid NTE...             450
5......................................              65  No.....................................              65
----------------------------------------------------------------------------------------------------------------

    (g) Engines meet the vehicle-pass criteria under this section if 
they meet both of the following criteria:
    (1) The vehicle-pass ratio calculated according to paragraph (e) of 
this section must be at least 0.90 for each pollutant.
    (2) For model year 2007 through 2009 engines, emission levels from 
every valid NTE sampling event must be less than 2.0 times the NTE 
thresholds calculated according to paragraph (a) of this section for 
all pollutants, except that engines certified to a NOX FEL 
at or below 0.50 g/hp[middot]hr may meet the vehicle-pass criteria for 
NOX if measured NOX emissions from every valid 
NTE sample are less than either 2.0 times the NTE threshold for 
NOX or 2.0 g/hp[middot]hr, whichever is greater.

0
94. Section 86.1920 is amended by revising paragraph (b) introductory 
text to read as follows:


Sec.  86.1920  What in-use testing information must I report to EPA?

* * * * *
    (b) Within 45 days after the end of each calendar quarter, send us 
reports containing the test data from each engine for which testing was 
completed during the calendar quarter. Alternatively, you may 
separately send us the test data within 30 days after you complete 
testing for an engine. If you request it, we may allow additional time 
to send us this information. Once you

[[Page 74000]]

send us information under this section, you need not send that 
information again in later reports. Prepare your test reports as 
follows:
* * * * *

Appendix I to Part 86--[Amended]

0
95. Appendix I to part 86 is amended by removing paragraph (f)(3).

PART 600--FUEL ECONOMY AND GREENHOUSE GAS EXHAUST EMISSIONS OF 
MOTOR VEHICLES

0
96. The authority citation for part 600 continues to read as follows:

    Authority: 49 U.S.C. 32901-23919q, Pub. L. 109-58.

Subpart A--General Provisions

0
97. Section 600.001 is amended by revising paragraph (a) to read as 
follows:


Sec.  600.001   General applicability.

    (a) The provisions of this part apply to 2008 and later model year 
automobiles that are not medium duty passenger vehicles, and to 2011 
and later model year automobiles including medium-duty passenger 
vehicles. The test procedures in subpart B of this part also apply to 
2014 and later heavy-duty vehicles subject to standards under 40 CFR 
part 86, subpart S.
* * * * *

0
98. Section 600.002 is amended by revising the definitions for ``Engine 
code'', ``Subconfiguration'', ``Transmission class'', and ``Vehicle 
configuration'' to read as follows:


Sec.  600.002  Definitions.

* * * * *
    Engine code means one of the following:
    (1) For LDV, LDT, and MDPV, engine code means a unique combination, 
within an engine-system combination (as defined in Sec.  86.1803 of 
this chapter), of displacement, fuel injection (or carburetion or other 
fuel delivery system), calibration, distributor calibration, choke 
calibration, auxiliary emission control devices, and other engine and 
emission control system components specified by the Administrator. For 
electric vehicles, engine code means a unique combination of 
manufacturer, electric traction motor, motor configuration, motor 
controller, and energy storage device.
    (2) For HDV, engine code has the meaning given in Sec.  86.1819-
14(d)(12) of this chapter.
* * * * *
    Subconfiguration means one of the following:
    (1) For LDV, LDT, and MDPV, subconfiguration means a unique 
combination within a vehicle configuration of equivalent test weight, 
road-load horsepower, and any other operational characteristics or 
parameters which the Administrator determines may significantly affect 
fuel economy or CO2 emissions within a vehicle 
configuration.
    (2) For HDV, subconfiguration has the meaning given in Sec.  
86.1819-14(d)(12) of this chapter.
* * * * *
    Transmission class means a group of transmissions having the 
following common features: Basic transmission type (e.g., automatic, 
manual, automated manual, semi-automatic, or continuously variable); 
number of forward gears used in fuel economy testing (e.g., manual 
four-speed, three-speed automatic, two-speed semi-automatic); drive 
system (e.g., front wheel drive, rear wheel drive; four wheel drive), 
type of overdrive, if applicable (e.g., final gear ratio less than 
1.00, separate overdrive unit); torque converter type, if applicable 
(e.g., non-lockup, lockup, variable ratio); and other transmission 
characteristics that may be determined to be significant by the 
Administrator.
* * * * *
    Vehicle configuration means one of the following:
    (1) For LDV, LDT, and MDPV, vehicle configuration means a unique 
combination of basic engine, engine code, inertia weight class, 
transmission configuration, and axle ratio within a base level.
    (2) For HDV, vehicle configuration has the meaning given for 
``configuration'' in Sec.  86.1819-14(d)(12) of this chapter.
* * * * *

Subpart B--Fuel Economy and Carbon-Related Exhaust Emission Test 
Procedures

0
99. Section 600.113-12 is amended by revising paragraphs (m), (n) 
introductory text, (n)(2), and (n)(3) and adding paragraph (o) to read 
as follows:


Sec.  600.113-12  Fuel economy, CO2 emissions, and carbon-related 
exhaust emission calculations for FTP, HFET, US06, SC03 and cold 
temperature FTP tests.

* * * * *
    (m)(1) For automobiles fueled with liquefied petroleum gas and 
automobiles designed to operate on gasoline and liquefied petroleum 
gas, the fuel economy in miles per gallon of liquefied petroleum gas is 
to be calculated using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.042

Where:

mpge = miles per gasoline gallon equivalent of liquefied 
petroleum gas.
CWFfuel = carbon weight fraction based on the hydrocarbon 
constituents in the liquefied petroleum gas fuel as obtained in 
paragraph (f)(5) of this section and rounded according to paragraph 
(g)(3) of this section.
SG = Specific gravity of the fuel as determined in paragraph (f)(5) 
of this section and rounded according to paragraph (g)(3) of this 
section.
3781.8 = Grams of H2O per gallon conversion factor.
CWFHC = Carbon weight fraction of exhaust hydrocarbon = 
CWFfuel as determined in paragraph (f)(4) of this section 
and rounded according to paragraph (f)(3) of this section.
HC = Grams/mile HC as obtained in paragraph (g)(2) of this section.
CO = Grams/mile CO as obtained in paragraph (g)(2) of this section.
CO2 = Grams/mile CO2 as obtained in paragraph 
(g)(2) of this section.

    (2)(i) For automobiles fueled with liquefied petroleum gas and 
automobiles designed to operate on gasoline and liquefied petroleum 
gas, the carbon-related exhaust emissions in grams per mile while 
operating on liquefied petroleum gas is to be calculated for 2012 and 
later model year vehicles using the following equation and rounded to 
the nearest 1 gram per mile:

CREE = (CWFHC/0.273 x HC) + (1.571 x CO) + CO2

Where:

CREE means the carbon-related exhaust emission value as defined in 
Sec.  600.002.
CWFHC = Carbon weight fraction of exhaust hydrocarbon = 
CWFfuel as determined in paragraph (f)(5) of this section 
and rounded according to paragraph (g)(3) of this section.
HC = Grams/mile HC as obtained in paragraph (g)(2) of this section.

[[Page 74001]]

CO = Grams/mile CO as obtained in paragraph (g)(2) of this section.
CO2 = Grams/mile CO2 as obtained in paragraph 
(g)(2) of this section.

    (ii) For manufacturers complying with the fleet averaging option 
for N2O and CH4 as allowed under Sec.  86.1818 of 
this chapter, the carbon-related exhaust emissions in grams per mile 
for 2012 and later model year automobiles fueled with liquefied 
petroleum gas and automobiles designed to operate on mixtures of 
gasoline and liquefied petroleum gas while operating on liquefied 
petroleum gas is to be calculated using the following equation and 
rounded to the nearest 1 gram per mile:

CREE = [(CWFexHC/0.273) x NMHC] + (1.571 x CO) + 
CO2 + (298 x N2O) + (25 x CH4)

Where:

CREE means the carbon-related exhaust emission value as defined in 
Sec.  600.002.
CWFHC = Carbon weight fraction of exhaust hydrocarbon = 
CWFfuel as determined in paragraph (f)(5) of this section 
and rounded according to paragraph (g)(3) of this section.
NMHC = Grams/mile HC as obtained in paragraph (g)(2) of this 
section.
CO = Grams/mile CO as obtained in paragraph (g)(2) of this section.
CO2 = Grams/mile CO2 as obtained in paragraph 
(g)(2) of this section.
N2O = Grams/mile N2O as obtained in paragraph 
(g)(2) of this section.
CH4 = Grams/mile CH4 as obtained in paragraph 
(g)(2) of this section.

    (n) Manufacturers shall determine CO2 emissions and 
carbon-related exhaust emissions for electric vehicles, fuel cell 
vehicles, and plug-in hybrid electric vehicles according to the 
provisions of this paragraph (n). Subject to the limitations on the 
number of vehicles produced and delivered for sale as described in 
Sec.  86.1866 of this chapter, the manufacturer may be allowed to use a 
value of 0 grams/mile to represent the emissions of fuel cell vehicles 
and the proportion of electric operation of a electric vehicles and 
plug-in hybrid electric vehicles that is derived from electricity that 
is generated from sources that are not onboard the vehicle, as 
described in paragraphs (n)(1) through (3) of this section. For 
purposes of labeling under this part, the CO2 emissions for 
electric vehicles shall be 0 grams per mile. Similarly, for purposes of 
labeling under this part, the CO2 emissions for plug-in 
hybrid electric vehicles shall be 0 grams per mile for the proportion 
of electric operation that is derived from electricity that is 
generated from sources that are not onboard the vehicle. For 
manufacturers no longer eligible to use 0 grams per mile to represent 
electric operation, and for all 2026 and later model year electric 
vehicles, fuel cell vehicles, and plug-in hybrid electric vehicles, the 
provisions of this paragraph (n) shall be used to determine the non-
zero value for CREE for purposes of meeting the greenhouse gas emission 
standards described in Sec.  86.1818 of this chapter.
* * * * *
    (2) For plug-in hybrid electric vehicles, the carbon-related 
exhaust emissions in grams per mile is to be calculated according to 
the provisions of Sec.  600.116, except that the CREE for charge-
depleting operation shall be the sum of the CREE associated with 
gasoline consumption and the net upstream CREE determined according to 
paragraph (n)(1) of this section, rounded to the nearest one gram per 
mile.
    (3) For 2012 and later model year fuel cell vehicles, the carbon-
related exhaust emissions in grams per mile shall be calculated using 
the method specified in paragraph (n)(1) of this section, except that 
CREEUP shall be determined according to procedures 
established by the Administrator under Sec.  600.111-08(f). As 
described in Sec.  86.1866 of this chapter, the value of CREE may be 
set equal to zero for a certain number of 2012 through 2025 model year 
fuel cell vehicles.
    (o) Equations for fuels other than those specified in this section 
may be used with advance EPA approval. Alternate calculation methods 
for fuel economy and carbon-related exhaust emissions may be used in 
lieu of the methods described in this section if shown to yield 
equivalent or superior results and if approved in advance by the 
Administrator.

0
100. Section 600.116-12 is amended as follows:
0
a. By revising paragraph (c)(1) introductory text.
0
b. By redesignating paragraphs (c)(2) through (9) as paragraphs (c)(3) 
through (10), respectively.
0
c. By adding a new paragraph (c)(2).
0
d. By revising newly redesignated paragraph (c)(4).
0
e. By revising newly redesignated paragraph (c)(5) introductory text.
0
f. By revising paragraphs (d)(1)(i)(C), (d)(1)(ii), (d)(2)(ii), and 
(d)(3).
    The revisions and addition read as follows:


Sec.  600.116-12   Special procedures related to electric vehicles and 
hybrid electric vehicles.

* * * * *
    (c) * * *
    (1) To determine CREE values to demonstrate compliance with GHG 
standards, calculate composite values representing combined operation 
during charge-depleting and charge-sustaining operation using the 
following utility factors except as specified in this paragraph (c):
* * * * *
    (2) Determine fuel economy values to demonstrate compliance with 
CAFE standards as follows:
    (i) For vehicles that are not dual fueled automobiles, determine 
fuel economy using the utility factors described in paragraph (c)(1) of 
this section. Do not use the petroleum-equivalence factors described in 
10 CFR 474.3.
    (ii) Except as described in paragraph (c)(2)(iii) of this section, 
determine fuel economy for dual fueled automobiles from the following 
equation, separately for city and highway driving:
[GRAPHIC] [TIFF OMITTED] TR25OC16.043

Where:

MPGgas = The miles per gallon measured while operating on 
gasoline during charge-sustaining operation as determined using the 
procedures of SAE J1711.
MPGeelec = The miles per gallon equivalent measured while 
operating on electricity. Calculate this value by dividing the 
equivalent all-electric range determined from the equation in Sec.  
86.1866-12(b)(2)(ii) by the corresponding measured Watt-hours of 
energy consumed; apply the appropriate petroleum-equivalence factor 
from 10 CFR 474.3 to convert Watt-hours to

[[Page 74002]]

gallons equivalent. Note that if vehicles use no gasoline during 
charge-depleting operation, MPGeelec is the same as the 
charge-depleting fuel economy specified in SAE J1711.

    (iii) For 2016 and later model year dual fueled automobiles, you 
may determine fuel economy based on the following equation, separately 
for city and highway driving:
[GRAPHIC] [TIFF OMITTED] TR25OC16.044

Where:

UF = The appropriate utility factor for city or highway driving as 
described in paragraph (c)(1) of this section.
* * * * *
    (4) You may calculate performance values under paragraphs (c)(1) 
through (3) of this section by combining phases during FTP testing. For 
example, you may treat the first 7.45 miles as a single phase by adding 
the individual utility factors for that portion of driving and 
assigning emission levels to the combined phase. Do this consistently 
throughout a test run.
    (5) Instead of the utility factors specified in paragraphs (c)(1) 
through (3) of this section, calculate utility factors using the 
following equation for vehicles whose maximum speed is less than the 
maximum speed specified in the driving schedule, where the vehicle's 
maximum speed is determined, to the nearest 0.1 mph, from observing the 
highest speed over the first duty cycle (FTP, HFET, etc.):
* * * * *
    (d) * * *
    (1) * * *
    (i) * * *
    (C) Determine braking power in kilowatts using the following 
equation. Note that during braking events, Pbrake, 
Paccel, and Proadload will all be negative (i.e., 
resistive) forces on the vehicle.

Pbrake = Paccel-Proadload

Where:

Paccel = the value determined in paragraph (d)(1)(i)(B) 
of this section;
Proadload = the value determined in paragraph 
(d)(1)(i)(A) of this section; and
Pbrake = 0 if Paccel is greater than or equal 
to Proadload.

    (ii) The total maximum braking energy (Ebrake) that 
could theoretically be recovered is equal to the absolute value of the 
sum of all the values of Pbrake determined in paragraph 
(d)(1)(i)(C) of this section, divided by 36000 (to convert 10 Hz data 
to hours) and rounded to the nearest 0.01 kilowatt-hours.
    (2) * * *
    (ii) At each sampling point where current is flowing into the 
battery, calculate the energy flowing into the battery, in Watt-hours, 
as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.045

Where:

Et = the energy flowing into the battery, in Watt-hours, 
at time t in the test;
It = the electrical current, in Amps, at time t in the 
test; and
Vnominal = the nominal voltage of the hybrid battery 
system determined according to paragraph (d)(4) of this section.
* * * * *
    (3) The percent of braking energy recovered by a hybrid system 
relative to the total available energy is determined by the following 
equation, rounded to the nearest one percent:
[GRAPHIC] [TIFF OMITTED] TR25OC16.046

Where:

Erec = The actual total energy recovered, in kilowatt-
hours, as determined in paragraph (d)(2) of this section; and
Ebrake = The theoretical maximum amount of energy, in 
kilowatt-hours, that could be recovered by a hybrid electric vehicle 
over the FTP test cycle, as determined in paragraph (d)(1) of this 
section.
* * * * *

Subpart C--Procedures for Calculating Fuel Economy and Carbon-
Related Exhaust Emission Values

0
101. Section 600.208-12 is amended by revising paragraph (a)(2)(iii) to 
read as follows:


Sec.  600.208-12  Calculation of FTP-based and HFET-based fuel economy, 
CO2 emissions, and carbon-related exhaust emissions for a 
model type.

    (a) * * *
    (2) * * *
    (iii) All subconfigurations within the new base level are 
represented by test data in accordance with Sec.  600.010(c)(1)(iii).
* * * * *

0
102. Section 600.210-12 is amended by revising paragraph (c)(2)(iv)(C) 
to read as follows:


Sec.  600.210-12  Calculation of fuel economy and CO2 
emission values for labeling.

* * * * *
    (c) * * *
    (2) * * *
    (iv) * * *
    (C) Calculate a composite city CO2 emission rate and a 
composite highway CO2 emission rate by combining the 
separate results for battery and engine operation using the procedures 
described in Sec.  600.116. Use these values to calculate the vehicle's 
combined CO2 emissions as described in paragraph (c)(2)(i) 
of this section.
* * * * *

Subpart D--Fuel Economy Labeling

0
103. Section 600.311-12 is amended by revising paragraph (g) to read as 
follows:


Sec.  600.311-12  Determination of values for fuel economy labels.

* * * * *
    (g) Smog rating. Establish a rating for exhaust emissions other 
than CO2 based on the applicable emission standards for the 
appropriate model year as shown in Tables 1 through 3 of this section. 
Unless specified otherwise, use the California emission standards to 
select the smog rating only for vehicles not certified to any EPA 
standards. For Independent Commercial Importers that import vehicles 
not subject to Tier 2 or Tier 3 emission standards, the vehicle's smog 
rating is 1. Similarly, if a manufacturer certifies vehicles to 
emission standards that are less stringent than all the identified 
standards for any reason, the vehicle's smog rating is 1. If EPA or 
California emission standards change in the future, we may revise the 
emission levels corresponding to each rating for future model years as 
appropriate to reflect the changed standards. If this occurs, we would 
publish the revised ratings as described in Sec.  600.302-12(k), 
allowing sufficient lead time to make the

[[Page 74003]]

changes; we would also expect to initiate a rulemaking to update the 
smog rating in the regulation.

        Table 1 of Sec.   600.311-12--Criteria for Establishing Smog Rating for Model Year 2025 and Later
----------------------------------------------------------------------------------------------------------------
                                                                          California Air Resources Board LEV III
            Rating                 U.S. EPA Tier 3 emission standard                emission standard
----------------------------------------------------------------------------------------------------------------
1.............................  Bin 160................................  LEV 160.
2.............................  Bin 125................................  ULEV125.
4.............................  Bin 70.................................  ULEV70.
5.............................  Bin 50.................................  ULEV50.
6.............................  Bin 30.................................  SULEV30.
7.............................  Bin 20.................................  SULEV20.
10............................  Bin 0..................................  ZEV.
----------------------------------------------------------------------------------------------------------------


                              Table 2 of Sec.   600.311-12--Criteria for Establishing Smog Rating for Model Years 2018-2024
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                  California Air Resources Board LEV III
            Rating                 U.S. EPA Tier 3 emission standard         U.S EPA Tier 2 emission standard                emission standard
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.............................  Bin 160................................  Bin 5 through Bin 8....................  LEV 160.
3.............................  Bin 125, Bin 110.......................  Bin 4..................................  ULEV125.
5.............................  Bin 85, Bin 70.........................  Bin 3..................................  ULEV70.
6.............................  Bin 50.................................  .......................................  ULEV50.
7.............................  Bin 30.................................  Bin 2..................................  SULEV30.
8.............................  Bin 20.................................  .......................................  SULEV20.
10............................  Bin 0..................................  Bin 1..................................  ZEV.
--------------------------------------------------------------------------------------------------------------------------------------------------------


           Table 3 of Sec.   600.311-12--Criteria for Establishing Smog Rating Through Model Year 2017
----------------------------------------------------------------------------------------------------------------
                                                                            California Air      California Air
                                    U.S. EPA Tier 2     U.S. EPA Tier 3     Resources Board     Resources Board
             Rating                emission standard   emission standard    LEV II emission    LEV III emission
                                                                               standard            standard
----------------------------------------------------------------------------------------------------------------
1...............................  ..................  ..................  ULEV & LEV II
                                                                           large trucks.
2...............................  Bin 8.............  ..................  SULEV II large
                                                                           trucks.
3...............................  Bin 7.............
4...............................  Bin 6.............  ..................  LEV II, option 1..
5...............................  Bin 5.............  Bin 160...........  LEV II............  LEV160.
6...............................  Bin 4.............  Bin 125, Bin 110..  ULEV II...........  ULEV125.
7...............................  Bin 3.............  Bin 85, Bin 70,     ..................  ULEV70, ULEV50.
                                                       Bin 50.
8...............................  Bin 2 \1\.........  Bin 30............  SULEV II..........  SULEV30.
9...............................  ..................  Bin 20............  PZEV..............  SULEV20, PZEV.
10..............................  Bin 1.............  Bin 0.............  ZEV...............  ZEV.
----------------------------------------------------------------------------------------------------------------
\1\ Vehicles qualify with a rating of 9 instead of 8 if they are certified to the EPA Tier 2, Bin 2 standards,
  and they are sold nationwide in a configuration that is certified in California to the PZEV or SULEV20
  standards.

* * * * *

Subpart F--Procedures for Determining Manufacturer's Average Fuel 
Economy and Manufacturer's Average Carbon-Related Exhaust Emissions

0
104. Section 600.510-12 is amended as follows:
0
a. By revising the entry for ``MPG ='' in paragraph (c)(1)(ii) after 
the equation.
0
b. By revising paragraphs (c)(2)(vi) introductory text, (c)(2)(vii)(A) 
introductory text, and (h).
    The revisions read as follows:


Sec.  600.510-12   Calculation of average fuel economy and average 
carbon-related exhaust emissions.

* * * * *
    (c) * * *
    (1) * * *
    (ii) * * *
    MPG = the average fuel economy for a category of vehicles 
determined according to paragraph (h) of this section;
* * * * *
    (c) * * *
    (2) * * *
    (vi) For natural gas dual fuel model types, for model years 1993 
through 2016, the harmonic average of the following two terms; the 
result rounded to the nearest 0.1 mpg:
* * * * *
    (vii)(A) For natural gas dual fuel model types, for model years 
after 2016, the combined model type fuel economy determined according 
to the following formula and rounded to the nearest 0.1 mpg:
* * * * *
    (h) The increase in average fuel economy determined in paragraph 
(c) of this section attributable to dual fueled automobiles is subject 
to a maximum value that applies separately to each category of 
automobile specified in paragraph (a)(1) of this section. The increase 
in average fuel economy attributable to vehicles fueled by electricity 
or, for model years 2016 and later, by compressed natural gas, is not 
subject to a maximum value. The following maximum values apply under 
this paragraph (h):

------------------------------------------------------------------------
                                                              Maximum
                       Model year                         increase (mpg)
------------------------------------------------------------------------
1993-2014...............................................             1.2
2015....................................................             1.0
2016....................................................             0.8
2017....................................................             0.6
2018....................................................             0.4
2019....................................................             0.2
2020 and later..........................................             0.0
------------------------------------------------------------------------


[[Page 74004]]

    (1) The Administrator shall calculate the increase in average fuel 
economy to determine if the maximum increase provided in this paragraph 
(h) has been reached. The Administrator shall calculate the increase in 
average fuel economy for each category of automobiles specified in 
paragraph (a)(1) of this section by subtracting the average fuel 
economy values calculated in accordance with this section, assuming all 
alcohol dual fueled automobiles are operated exclusively on gasoline 
(or diesel fuel), from the average fuel economy values determined in 
paragraph (c) of this section. The difference is limited to the maximum 
increase specified in this paragraph (h).
    (2) [Reserved]
* * * * *

PART 1033--CONTROL OF EMISSIONS FROM LOCOMOTIVES

0
105. The authority citation for part 1033 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart A--Overview and Applicability

0
106. Section 1033.1 is amended by revising paragraph (e) to read as 
follows:


Sec.  1033.1  Applicability.

* * * * *
    (e) The provisions of this part apply as specified for locomotives 
manufactured or remanufactured on or after July 7, 2008. See Sec.  
1033.102 to determine whether the standards of this part or the 
standards specified in Appendix I of this part apply for model years 
2008 through 2012. For example, for a locomotive that was originally 
manufactured in 2007 and remanufactured on April 10, 2014, the 
provisions of this part begin to apply on April 10, 2014.

0
107. Section 1033.30 is revised to read as follows:


Sec.  1033.30  Submission of information.

    Unless we specify otherwise, send all reports and requests for 
approval to the Designated Compliance Officer (see Sec.  1033.901). See 
Sec.  1033.925 for additional reporting and recordkeeping provisions.

Subpart B--Emission Standards and Related Requirements

0
108. Section 1033.101 is amended by revising paragraphs (f)(1)(ii), 
(f)(2)(i) and (iii), and (i) to read as follows:


Sec.  1033.101  Exhaust emission standards.

* * * * *
    (f) * * *
    (1) * * *
    (ii) Gaseous-fueled locomotives: Nonmethane-nonethane emissions 
(NMNEHC). This includes dual-fuel and flexible-fuel locomotives that 
use a combination of a gaseous fuel and a nongaseous fuel.
* * * * *
    (2) * * *
    (i) Certify your Tier 4 and later diesel-fueled locomotives for 
operation with only Ultra Low Sulfur Diesel (ULSD) fuel. Use ULSD as 
the test fuel for these locomotives. You may alternatively certify Tier 
4 and later locomotives using Low Sulfur Diesel Fuel (LSD).
* * * * *
    (iii) Certify your Tier 3 and earlier diesel-fueled locomotives for 
operation with either ULSD fuel or LSD fuel if they do not include 
sulfur-sensitive technology or if you demonstrate compliance using an 
LSD test fuel (including commercial LSD fuel).
* * * * *
    (i) Alternate CO standards. Manufacturers/remanufacturers may 
certify locomotives to an alternate CO emission standard of 10.0 g/bhp-
hr instead of the otherwise applicable CO standard if they also certify 
those locomotives to alternate PM standards as follows:
    (1) The alternate PM standard for Tier 0, Tier 1, and Tier 2 
locomotives is one-half of the otherwise applicable PM standard. For 
example, a manufacturer certifying Tier 2 switch locomotives to a 0.065 
g/bhp-hr PM standard may certify those locomotives to the alternate CO 
standard of 10.0 g/bhp-hr.
    (2) The alternate PM standard for Tier 3 and Tier 4 locomotives is 
0.01 g/bhp-hr.
* * * * *

0
109. Section 1033.102 is revised to read as follows:


Sec.  1033.102  Transition to the standards specified in this subpart.

    (a) The Tier 0 and Tier 1 standards of Sec.  1033.101 apply for new 
locomotives beginning January 1, 2010, except as specified in Sec.  
1033.150(a). The Tier 0 and Tier 1 standards specified in Appendix I of 
this part apply for earlier model years.
    (b) Except as specified in Sec.  1033.150(a), the Tier 2 standards 
of Sec.  1033.101 apply for new locomotives beginning January 1, 2013. 
The Tier 2 standards specified in Appendix I of this part apply for 
earlier model years.
    (c) The Tier 3 and Tier 4 standards of Sec.  1033.101 apply for the 
model years specified in that section.

0
110. Section 1033.120 is amended by revising paragraph (b) to read as 
follows:


Sec.  1033.120  Emission-related warranty requirements.

* * * * *
    (b) Warranty period. Except as specified in this paragraph, the 
minimum warranty period is one-third of the useful life. Your emission-
related warranty must be valid for at least as long as the minimum 
warranty periods listed in this paragraph (b) in MW-hrs of operation 
(or miles for Tier 0 locomotives not equipped with MW-hr meters) and 
years, whichever comes first. You may offer an emission-related 
warranty more generous than we require. The emission-related warranty 
for the locomotive may not be shorter than any basic mechanical 
warranty you provide without charge for the locomotive. Similarly, the 
emission-related warranty for any component may not be shorter than any 
warranty you provide without charge for that component. This means that 
your warranty may not treat emission-related and nonemission-related 
defects differently for any component. If you provide an extended 
warranty to individual owners for any components covered in paragraph 
(c) of this section for an additional charge, your emission-related 
warranty must cover those components for those owners to the same 
degree. If the locomotive does not record MW-hrs, we base the warranty 
periods in this paragraph (b) only on years. The warranty period begins 
when the locomotive is placed into service, or back into service after 
remanufacture.
* * * * *

0
111. Section 1033.135 is amended by revising paragraph (b)(3) to read 
as follows:


Sec.  1033.135  Labeling.

* * * * *
    (b) * * *
    (3) Label diesel-fueled locomotives near the fuel inlet to identify 
the allowable fuels, consistent with Sec.  1033.101. For example, Tier 
4 locomotives with sulfur-sensitive technology (or that otherwise 
require ULSD for compliance) should be labeled ``ULTRA LOW SULFUR 
DIESEL FUEL ONLY''. You do not need to label Tier 3 and earlier 
locomotives certified for use with both LSD and ULSD.
* * * * *

0
112. Section 1033.150 is amended by revising paragraphs (a)(4)(ii) and 
(g) introductory text to read as follows:


Sec.  1033.150   Interim provisions.

* * * * *
    (a) * * *
    (4) * * *
    (ii) Calculate all costs in current dollars (for the month prior to 
the date

[[Page 74005]]

you submit your application). Calculate fuel costs based on a fuel 
price adjusted by the Association of American Railroads' monthly 
railroad fuel price index (P), which is available at https://www.aar.org/data-center/rail-cost-indexes. (Use values indexed to a 
price of 100.0 for July 15, 1990.) Calculate a new fuel price using the 
following equation:

Fuel Price = ($2.76 per gallon) x (P/539.8)
* * * * *
    (g) Optional interim Tier 4 compliance provisions for 
NOX emissions. For model years 2015 through 2022, 
manufacturers may choose to certify some or all of their Tier 4 line-
haul engine families according to the optional compliance provisions of 
this paragraph (g). The following provisions apply to all locomotives 
in those families:
* * * * *

Subpart C--Certifying Engine Families

0
113. Section 1033.201 is amended by revising paragraphs (a) and (g) to 
read as follows:


Sec.  1033.201  General requirements for obtaining a certificate of 
conformity.

* * * * *
    (a) You must send us a separate application for a certificate of 
conformity for each engine family. A certificate of conformity is valid 
for new production from the indicated effective date, until the end of 
the model year for which it is issued, which may not extend beyond 
December 31 of that year. No certificate will be issued after December 
31 of the model year. You may amend your application for certification 
after the end of the model year in certain circumstances as described 
in Sec. Sec.  1033.220 and 1033.225. You must renew your certification 
annually for any locomotives you continue to produce.
* * * * *
    (g) We may require you to deliver your test locomotives (including 
test engines, as applicable) to a facility we designate for our testing 
(see Sec.  1033.235(c)). Alternatively, you may choose to deliver 
another engine/locomotive that is identical in all material respects to 
the test locomotive, or another engine/locomotive that we determine can 
appropriately serve as an emission-data locomotive for the engine 
family.
* * * * *

0
114. Section 1033.225 is amended by revising the section heading and 
adding paragraphs (b)(4) and (g) to read as follows:


Sec.  1033.225  Amending applications for certification.

* * * * *
    (b) * * *
    (4) Include any other information needed to make your application 
correct and complete.
* * * * *
    (g) You may produce engines as described in your amended 
application for certification and consider those engines to be in a 
certified configuration if we approve a new or modified engine 
configuration during the model year under paragraph (d) of this 
section. Similarly, you may modify in-use engines as described in your 
amended application for certification and consider those engines to be 
in a certified configuration if we approve a new or modified engine 
configuration at any time under paragraph (d) of this section. 
Modifying a new or in-use engine to be in a certified configuration 
does not violate the tampering prohibition of 40 CFR 1068.101(b)(1), as 
long as this does not involve changing to a certified configuration 
with a higher family emission limit.

0
115. Section 1033.235 is amended by revising paragraphs (b), (c) 
introductory text, (c)(4), and (d)(1) to read as follows:


Sec.  1033.235  Emission testing required for certification.

* * * * *
    (b) Test your emission-data locomotives using the procedures and 
equipment specified in subpart F of this part. In the case of dual-fuel 
locomotives, measure emissions when operating with each type of fuel 
for which you intend to certify the locomotive. In the case of 
flexible-fuel locomotives, measure emissions when operating with the 
fuel mixture that best represents in-use operation or is most likely to 
have the highest NOX emissions, though you may ask us 
instead to perform tests with both fuels separately if you can show 
that intermediate mixtures are not likely to occur in use.
    (c) We may perform confirmatory testing by measuring emissions from 
any of your emission-data locomotives or other locomotives from the 
engine family.
* * * * *
    (4) Before we test one of your locomotives, we may calibrate it 
within normal production tolerances for anything we do not consider an 
adjustable parameter. For example, this would apply for a parameter 
that is subject to production variability because it is adjustable 
during production, but is not considered an adjustable parameter (as 
defined in Sec.  1033.901) because it is permanently sealed.
    (d) * * *
    (1) The engine family from the previous model year differs from the 
current engine family only with respect to model year, items identified 
in Sec.  1033.225(a), or other factors not related to emissions. We may 
waive this criterion for differences we determine not to be relevant.
* * * * *

0
116. Section 1033.245 is amended by revising the introductory text and 
paragraph (b) introductory text and adding paragraphs (b)(3) through 
(5) to read as follows:


Sec.  1033.245  Deterioration factors.

    Establish deterioration factors for each pollutant to determine 
whether your locomotives will meet emission standards for each 
pollutant throughout the useful life, as described in Sec.  1033.240. 
Determine deterioration factors as described in this section, either 
with an engineering analysis, with pre-existing test data, or with new 
emission measurements. The deterioration factors are intended to 
reflect the deterioration expected to result during the useful life of 
a locomotive maintained as specified in Sec.  1033.125. If you perform 
durability testing, the maintenance that you may perform on your 
emission-data locomotive is limited to the maintenance described in 
Sec.  1033.125. You may carry across a deterioration factor from one 
engine family to another consistent with good engineering judgment.
* * * * *
    (b) Apply deterioration factors as follows:
* * * * *
    (3) Sawtooth and other nonlinear deterioration patterns. The 
deterioration factors described in paragraphs (b)(1) and (2) of this 
section assume that the highest useful life emissions occur either at 
the end of useful life or at the low-hour test point. The provisions of 
this paragraph (b)(3) apply where good engineering judgment indicates 
that the highest emissions over the useful life will occur between 
these two points. For example, emissions may increase with service 
accumulation until a certain maintenance step is performed, then return 
to the low-hour emission levels and begin increasing again. Base 
deterioration factors for locomotives with such emission patterns on 
the difference between (or ratio of) the point at which the highest 
emissions occur

[[Page 74006]]

and the low-hour test point. Note that this applies for maintenance-
related deterioration only where we allow such critical emission-
related maintenance.
    (4) Dual-fuel and flexible-fuel engines. In the case of dual-fuel 
and flexible-fuel locomotives, apply deterioration factors separately 
for each fuel type by measuring emissions with each fuel type at each 
test point. You may accumulate service hours on a single emission-data 
engine using the type of fuel or the fuel mixture expected to have the 
highest combustion and exhaust temperatures; you may ask us to approve 
a different fuel mixture if you demonstrate that a different criterion 
is more appropriate.
    (5) Deterioration factor for crankcase emissions. If your engine 
vents crankcase emissions to the exhaust or to the atmosphere, you must 
account for crankcase emission deterioration, using good engineering 
judgment. You may use separate deterioration factors for crankcase 
emissions of each pollutant (either multiplicative or additive) or 
include the effects in combined deterioration factors that include 
exhaust and crankcase emissions together for each pollutant.
* * * * *

0
117. Section 1033.250 is amended by revising paragraphs (b)(3)(iv) and 
(c) to read as follows:


Sec.  1033.250  Reporting and recordkeeping.

* * * * *
    (b) * * *
    (3) * * *
    (iv) All your emission tests (valid and invalid), including the 
date and purpose of each test and documentation of test parameters as 
specified in part 40 CFR part 1065, and the date and purpose of each 
test.
* * * * *
    (c) Keep required data from emission tests and all other 
information specified in this section for eight years after we issue 
your certificate. If you use the same emission data or other 
information for a later model year, the eight-year period restarts with 
each year that you continue to rely on the information.
* * * * *

0
118. Section 1033.255 is amended by revising paragraphs (c)(2), (c)(4), 
(d), and (e) to read as follows:


Sec.  1033.255  EPA decisions.

* * * * *
    (c) * * *
    (2) Submit false or incomplete information (paragraph (e) of this 
section applies if this is fraudulent). This includes doing anything 
after submission of your application to render any of the submitted 
information false or incomplete.
* * * * *
    (4) Deny us from completing authorized activities (see 40 CFR 
1068.20). This includes a failure to provide reasonable assistance.
* * * * *
    (d) We may void the certificate of conformity for an engine family 
if you fail to keep records, send reports, or give us information as 
required under this part or the Act. Note that these are also 
violations of 40 CFR 1068.101(a)(2).
    (e) We may void your certificate if we find that you intentionally 
submitted false or incomplete information. This includes rendering 
submitted information false or incomplete after submission.
* * * * *

Subpart D--Manufacturer and Remanufacturer Production Line Testing 
and Audit Programs

0
119. Section 1033.301 is amended by revising paragraph (a) to read as 
follows:


Sec.  1033.301   Applicability.

* * * * *
    (a) The requirements of Sec. Sec.  1033.310, 1033.315, 1033.320, 
and 1033.330 apply only to manufacturers of freshly manufactured 
locomotives or locomotive engines (including those used for 
repowering). We may also apply these requirements to remanufacturers of 
any locomotives for which there is reason to believe production 
problems exist that could affect emission performance. When we make a 
determination that production problems may exist that could affect 
emission performance, we will notify the remanufacturer(s). The 
requirements of Sec. Sec.  1033.310, 1033.315, 1033.320, and 1033.330 
will apply as specified in the notice.
* * * * *


Sec.  1033.320  [Amended]

0
120. Section 1033.320 is amended by redesignating paragraphs (e)(6) and 
(e)(7) as paragraphs (e)(5) and (e)(6), respectively.

Subpart F--Test Procedures

0
121. Section 1033.501 is amended by revising paragraph (a)(3) and 
adding paragraphs (a)(4), (a)(5), and (j) to read as follows:


Sec.  1033.501  General provisions.

    (a) * * *
    (3) The following provisions apply for engine mapping, duty-cycle 
generation, and cycle validation to account for the fact that 
locomotive operation and locomotive duty cycles are based on operator 
demand from locomotive notch settings, not on target values for engine 
speed and load:
    (i) The provisions related to engine mapping, duty-cycle 
generation, and cycle validation in 40 CFR 1065.510, 1065.512, and 
1065.514 do not apply for testing complete locomotives.
    (ii) The provisions related to engine mapping and duty-cycle 
generation in 40 CFR 1065.510 and 1065.512 are not required for testing 
with an engine dynamometer; however, the cycle validation criteria of 
40 CFR 1065.514 apply for such testing. Demonstrate compliance with 
cycle validation criteria based on manufacturer-declared values for 
maximum torque, maximum power, and maximum test speed, or determine 
these values from an engine map generated according to 40 CFR 1065.510. 
If you test using a ramped-modal cycle, you may perform cycle 
validation over all the test intervals together.
    (4) If you perform discrete-mode testing and use only one batch 
fuel measurement to determine your mean raw exhaust flow rate, you must 
target a constant sample flow rate over the mode. Verify proportional 
sampling as described in 40 CFR 1065.545 using the mean raw exhaust 
molar flow rate paired with each recorded sample flow rate.
    (5) If you perform discrete-mode testing by grouping the modes in 
the same manner as the test intervals of the ramped modal cycle using 
three different dilution settings for the groups, as allowed in Sec.  
1033.515(c)(5)(ii), you may verify proportional sampling over each 
group instead of each discrete mode.
* * * * *
    (j) The following provisions apply for locomotives using 
aftertreatment technology with infrequent regeneration events that may 
occur during testing:
    (1) Adjust measured emissions to account for aftertreatment 
technology with infrequent regeneration as described in Sec.  1033.535.
    (2) Invalidate a smoke test if active regeneration starts to occur 
during the test.

0
122. Section 1033.515 is amended by revising paragraphs (c)(2)(ii), 
(c)(4), and (c)(5)(ii) to read as follows:


Sec.  1033.515  Discrete-mode steady-state emission tests of 
locomotives and locomotive engines.

* * * * *
    (c) * * *
    (2) * * *

[[Page 74007]]

    (ii) The sample period is 300 seconds for all test modes except 
mode 8. The sample period for test mode 8 is 600 seconds.
* * * * *
    (4) If applicable, begin the smoke test at the start of the test 
mode A. Continue collecting smoke data until the completion of test 
mode 8. You may perform smoke measurements independent of criteria 
pollutant measurements by repeating the test over the duty cycle. If 
you choose this option, the minimum time-in-notch is 3.0 minutes for 
duty cycles in which only smoke is measured. Refer to Sec.  1033.101 to 
determine applicability of smoke testing and Sec.  1033.525 for details 
on how to conduct a smoke test.
    (5) * * *
    (ii) Group the modes in the same manner as the test intervals of 
the ramped modal cycle and use three different dilution settings for 
the groups. Use one setting for both idle modes, one for dynamic brake 
through Notch 5, and one for Notch 6 through Notch 8. For each group, 
ensure that the mode with the highest exhaust flow (typically normal 
idle, Notch 5, and Notch 8) meets the criteria for minimum dilution 
ratio in 40 CFR part 1065.
* * * * *

0
123. Section 1033.520 is revised to read as follows:


Sec.  1033.520  Alternative ramped modal cycles.

    (a) Locomotive testing over a ramped modal cycle is intended to 
improve measurement accuracy at low emission levels by allowing the use 
of batch sampling of PM and gaseous emissions over multiple locomotive 
notch settings. Ramped modal cycles combine multiple test modes of a 
discrete-mode steady-state into a single sample period. Time in notch 
is varied to be proportional to weighting factors. The ramped modal 
cycle for line-haul locomotives is shown in Table 1 to this section. 
The ramped modal cycle for switch locomotives is shown in Table 2 to 
this section. Both ramped modal cycles consist of a warm-up followed by 
three test intervals that are each weighted in a manner that maintains 
the duty-cycle weighting of the line-haul and switch locomotive duty 
cycles in Sec.  1033.530. You may use ramped modal cycle testing for 
any locomotives certified under this part.
    (b) Ramped modal testing requires continuous gaseous analyzers and 
three separate PM filters (one for each test interval). You may collect 
a single batch sample for each test interval, but you must also measure 
gaseous emissions continuously to allow calculation of notch caps as 
required under Sec.  1033.101.
    (c) You may operate the engine in any way you choose to warm it up. 
Then follow the provisions of 40 CFR part 1065, subpart F for general 
pre-test procedures (including engine and sampling system pre-
conditioning).
    (d) Begin the test by operating the locomotive over the pre-test 
portion of the cycle. For locomotives not equipped with catalysts, you 
may begin the test as soon as the engine reaches its lowest idle 
setting. For catalyst-equipped locomotives, you may begin the test in 
normal idle mode if the engine does not reach its lowest idle setting 
within 15 minutes. If you do start in normal idle, run the low idle 
mode after normal idle, then resume the specified mode sequence 
(without repeating the normal idle mode).
    (e) Start the test according to 40 CFR 1065.530.
    (1) Each test interval begins when operator demand is set to the 
first operator demand setting of each test interval of the ramped modal 
cycle. Each test interval ends when the time in mode is reached for the 
last mode in the test interval.
    (2) For PM emissions (and other batch sampling), the sample period 
over which emissions for the test interval are averaged generally 
begins within 10 seconds after the operator demand is changed to start 
the test interval and ends within 5 seconds of the sampling time for 
the test mode is reached (see Table 1 to this section). You may ask to 
delay the start of the sample period to account for sample system 
residence times longer than 10 seconds.
    (3) Use good engineering judgment when transitioning between test 
intervals.
    (i) You should come as close as possible to simultaneously:
    (A) Ending batch sampling of the previous test interval.
    (B) Starting batch sampling of the next test interval.
    (C) Changing the operator demand to the notch setting for the first 
mode in the next test interval.
    (ii) Avoid the following:
    (A) Overlapping batch sampling of the two test intervals.
    (B) An unnecessarily long delay before starting the next test 
interval.
    (iii) For example, the following sequence would generally be 
appropriate:
    (A) End batch sampling for Interval 2 after 304 seconds in Notch 5.
    (B) Switch the operator demand to Notch 6 one second later.
    (C) Begin batch sampling for Interval 3 one second after switching 
to Notch 6.
    (4) If applicable, begin the smoke test at the start of the first 
test interval of the applicable ramped modal cycle. Continue collecting 
smoke data until the completion of final test interval. You may perform 
smoke measurements independent of criteria pollutant measurements by 
rerunning the test over the duty cycle. If you choose this option, the 
minimum time-in-notch is 3.0 minutes for duty cycles in which only 
smoke is measured. Refer to Sec.  1033.101 to determine applicability 
of the smoke standards and Sec.  1033.525 for details on how to conduct 
a smoke test.
    (5) Proceed through each test interval of the applicable ramped 
modal cycle in the order specified until the test is completed.
    (6) If you must void a test interval, you may repeat it. To do so, 
begin with a warm engine operating at the notch setting for the last 
mode in the previous test interval. You do not need to repeat later 
test intervals if they were valid. (Note: You must report test results 
for all voided tests and test intervals.)
    (7) Following the completion of the third test interval of the 
applicable ramped modal cycle, conduct the post-test sampling 
procedures specified in 40 CFR 1065.530.
    (f) Calculate your cycle-weighted brake-specific emission rates as 
follows:
    (1) For each test interval j:
    (i) Calculate emission rates (Eij) for each pollutant i 
as the total mass emissions divided by the total time in the test 
interval.
    (ii) Calculate average power (Pj) as the total work 
divided by the total time in the test interval.
    (2) For each pollutant, calculate your cycle-weighted brake-
specific emission rate using the following equation, where 
wj is the weighting factor for test interval j:
[GRAPHIC] [TIFF OMITTED] TR25OC16.047

    (g) The following tables define applicable ramped modal cycles for 
line-haul and switch locomotives:

[[Page 74008]]



                       Table 1 to Sec.   1033.520--Line-Haul Locomotive Ramped Modal Cycle
----------------------------------------------------------------------------------------------------------------
                                  Weighting                     Time in mode
      RMC test interval            factor         RMC mode        (seconds)              Notch setting
----------------------------------------------------------------------------------------------------------------
Pre-test idle................              NA              NA      600 to 900  Lowest idle setting.\1\
Interval 1 (Idle test).......           0.380               A             600  Low Idle.\2\
                                                            B             600  Normal Idle.
----------------------------------------------------------------------------------------------------------------
                                               Interval Transition
----------------------------------------------------------------------------------------------------------------
Interval 2...................           0.389               C            1000  Dynamic Brake.\3\
                                                            1             520  Notch 1.
                                                            2             520  Notch 2.
                                                            3             416  Notch 3.
                                                            4             352  Notch 4.
                                                            5             304  Notch 5.
----------------------------------------------------------------------------------------------------------------
                                               Interval Transition
----------------------------------------------------------------------------------------------------------------
Interval 3...................           0.231               6             144  Notch 6.
                                                            7             111  Notch 7.
                                                            8             600  Notch 8.
----------------------------------------------------------------------------------------------------------------
\1\ See paragraph (d) of this section for alternate pre-test provisions.
\2\ Operate at normal idle for modes A and B if not equipped with multiple idle settings.
\3\ Operate at normal idle if not equipped with a dynamic brake.


                        Table 2 to Sec.   1033.520--Switch Locomotive Ramped Modal Cycle
----------------------------------------------------------------------------------------------------------------
                                  Weighting                     Time in mode
      RMC test interval            factor         RMC mode        (seconds)              Notch setting
----------------------------------------------------------------------------------------------------------------
Pre-test idle................              NA              NA      600 to 900  Lowest idle setting.\1\
Interval 1 (Idle test).......           0.598               A             600  Low Idle.\2\
                                                            B             600  Normal Idle.
----------------------------------------------------------------------------------------------------------------
                                               Interval Transition
----------------------------------------------------------------------------------------------------------------
Interval 2...................           0.377               1             868  Notch 1.
                                                            2             861  Notch 2.
                                                            3             406  Notch 3.
                                                            4             252  Notch 4.
                                                            5             252  Notch 5.
----------------------------------------------------------------------------------------------------------------
                                               Interval Transition
----------------------------------------------------------------------------------------------------------------
Interval 3...................           0.025               6            1080  Notch 6.
                                                            7             144  Notch 7.
                                                            8             576  Notch 8.
----------------------------------------------------------------------------------------------------------------
\1\ See paragraph (d) of this section for alternate pre-test provisions.
\2\ Operate at normal idle for modes A and B if not equipped with multiple idle settings.


0
124. Section 1033.535 is revised to read as follows:


Sec.  1033.535  Adjusting emission levels to account for infrequently 
regenerating aftertreatment devices.

    For locomotives using aftertreatment technology with infrequent 
regeneration events that may occur during testing, take one of the 
following approaches to account for the emission impact of 
regeneration:
    (a) You may use the calculation methodology described in 40 CFR 
1065.680 to adjust measured emission results. Do this by developing an 
upward adjustment factor and a downward adjustment factor for each 
pollutant based on measured emission data and observed regeneration 
frequency as follows:
    (1) Adjustment factors should generally apply to an entire engine 
family, but you may develop separate adjustment factors for different 
configurations within an engine family. Use the adjustment factors from 
this section for all testing for the engine family.
    (2) You may use carryover or carry-across data to establish 
adjustment factors for an engine family as described in Sec.  1033.235, 
consistent with good engineering judgment.
    (3) Determine the frequency of regeneration, F, as described in 40 
CFR 1065.680 from in-use operating data or from running repetitive 
tests in a laboratory. If the engine is designed for regeneration at 
fixed time intervals, you may apply good engineering judgment to 
determine F based on those design parameters.
    (4) Identify the value of F in each application for the 
certification for which it applies.
    (5) Apply the provisions for ramped-modal testing based on 
measurements for each test interval rather than the whole ramped-modal 
test.
    (b) You may ask us to approve an alternate methodology to account 
for regeneration events. We will generally limit approval to cases 
where your engines use aftertreatment technology with extremely 
infrequent regeneration and you are unable to apply the provisions of 
this section.

[[Page 74009]]

    (c) You may choose to make no adjustments to measured emission 
results if you determine that regeneration does not significantly 
affect emission levels for an engine family (or configuration) or if it 
is not practical to identify when regeneration occurs. If you choose 
not to make adjustments under paragraph (a) or (b) of this section, 
your locomotives must meet emission standards for all testing, without 
regard to regeneration.

Subpart G--Special Compliance Provisions

0
125. Section 1033.601 is amended by adding paragraph (f) to read as 
follows:


Sec.  1033.601  General compliance provisions.

* * * * *
    (f) Multi-fuel locomotives. Subpart C of this part describes how to 
test and certify dual-fuel and flexible-fuel locomotives. Some multi-
fuel locomotives may not fit either of those defined terms. For such 
locomotives, we will determine whether it is most appropriate to treat 
them as single-fuel locomotives, dual-fuel locomotives, or flexible-
fuel locomotives based on the range of possible and expected fuel 
mixtures. For example, a locomotive might burn natural gas but initiate 
combustion with a pilot injection of diesel fuel. If the locomotive is 
designed to operate with a single fueling algorithm (i.e., fueling 
rates are fixed at a given engine speed and load condition), we would 
generally treat it as a single-fuel locomotive, In this context, the 
combination of diesel fuel and natural gas would be its own fuel type. 
If the locomotive is designed to also operate on diesel fuel alone, we 
would generally treat it as a dual-fuel locomotive. If the locomotive 
is designed to operate on varying mixtures of the two fuels, we would 
generally treat it as a flexible-fuel locomotive. To the extent that 
requirements vary for the different fuels or fuel mixtures, we may 
apply the more stringent requirements.


Sec.  1033.640  [Amended]

0
126. Section 1033.640 is amended by redesignating the second paragraph 
(c) and paragraphs (d) and (e) as paragraphs (d) through (f), 
respectively.

Subpart H--Averaging, Banking, and Trading for Certification

0
127. Section 1033.701 is amended by adding paragraph (k) to read as 
follows:


Sec.  1033.701  General provisions.

* * * * *
    (k) You may use either of the following approaches to retire or 
forego emission credits:
    (1) You may retire emission credits generated from any number of 
your locomotives. This may be considered donating emission credits to 
the environment. Identify any such credits in the reports described in 
Sec.  1033.730. Locomotives must comply with the applicable FELs even 
if you donate or sell the corresponding emission credits under this 
paragraph (e). Those credits may no longer be used by anyone to 
demonstrate compliance with any EPA emission standards.
    (2) You may certify a family using an FEL below the emission 
standard as described in this part and choose not to generate emission 
credits for that family. If you do this, you do not need to calculate 
emission credits for those families and you do not need to submit or 
keep the associated records described in this subpart for that family.

0
128. Section 1033.710 is amended by revising paragraph (c) to read as 
follows:


Sec.  1033.710  Averaging emission credits.

* * * * *
    (c) If you certify an engine family to an FEL that exceeds the 
otherwise applicable emission standard, you must obtain enough emission 
credits to offset the engine family's deficit by the due date for the 
final report required in Sec.  1033.730. The emission credits used to 
address the deficit may come from your other engine families that 
generate emission credits in the same model year, from emission credits 
you have banked from previous model years, or from emission credits 
generated in the same or previous model years that you obtained through 
trading or by transfer.

0
129. Section 1033.725 is amended by revising paragraph (b)(2) to read 
as follows:


Sec.  1033.725  Requirements for your application for certification.

* * * * *
    (b) * * *
    (2) Detailed calculations of projected emission credits (positive 
or negative) based on projected production volumes. We may require you 
to include similar calculations from your other engine families to 
demonstrate that you will be able to avoid negative credit balances for 
the model year. If you project negative emission credits for a family, 
state the source of positive emission credits you expect to use to 
offset the negative emission credits.

0
130. Section 1033.730 is amended by revising paragraphs (b)(1), (b)(4), 
(c)(2), and (d) to read as follows:


Sec.  1033.730  ABT reports.

* * * * *
    (b) * * *
    (1) Engine family designation and averaging sets (whether switch, 
line-haul, or both).
* * * * *
    (4) The projected and actual U.S.-directed production volumes for 
the model year as described in Sec.  1033.705. If you changed an FEL 
during the model year, identify the actual U.S.-directed production 
volume associated with each FEL.
* * * * *
    (c) * * *
    (2) State whether you will retain any emission credits for banking. 
If you choose to retire emission credits that would otherwise be 
eligible for banking, identify the engine families that generated the 
emission credits, including the number of emission credits from each 
family.
* * * * *
    (d) If you trade emission credits, you must send us a report within 
90 days after the transaction, as follows:
    (1) As the seller, you must include the following information in 
your report:
    (i) The corporate names of the buyer and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) The averaging set corresponding to the engine families that 
generated emission credits for the trade, including the number of 
emission credits from each averaging set.
    (2) As the buyer, you must include the following information in 
your report:
    (i) The corporate names of the seller and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) How you intend to use the emission credits, including the 
number of emission credits you intend to apply for each averaging set.
* * * * *

0
131. Section 1033.735 is amended by revising paragraphs (a) and (b) to 
read as follows:


Sec.  1033.735  Required records.

    (a) You must organize and maintain your records as described in 
this section.
    (b) Keep the records required by this section for at least eight 
years after the due date for the end-of-year report. You may not use 
emission credits for any engines if you do not keep all the records 
required under this section. You must therefore keep these records to 
continue to bank valid credits.
* * * * *

[[Page 74010]]

Subpart I--Requirements for Owners and Operators

0
132. Section 1033.815 is amended by revising paragraphs (b) and (e) 
introductory text to read as follows:


Sec.  1033.815  Maintenance, operation, and repair.

* * * * *
    (b) Perform unscheduled maintenance in a timely manner. This 
includes malfunctions identified through the locomotive's emission 
control diagnostics system and malfunctions discovered in components of 
the diagnostics system itself. For most repairs, this paragraph (b) 
requires that the maintenance be performed no later than the 
locomotive's next periodic (92-day or 184-day) inspection. See 
paragraph (e) of this section, for reductant replenishment requirements 
in a locomotive equipped with an SCR system.
* * * * *
    (e) For locomotives equipped with emission controls requiring the 
use of specific fuels, lubricants, or other fluids, proper maintenance 
includes complying with the manufacturer/remanufacturer's 
specifications for such fluids when operating the locomotives. This 
requirement applies without regard to whether misfueling permanently 
disables the emission controls. For locomotives certified on ultra-low 
sulfur diesel fuel, but that do not include sulfur-sensitive emission 
controls, you may use low-sulfur diesel fuel instead of ultra-low 
sulfur diesel fuel, consistent with good engineering judgment. The 
following additional provisions apply for locomotives equipped with SCR 
systems requiring the use of urea or other reductants:
* * * * *

Subpart J--Definitions and Other Reference Information

0
133. Section 1033.901 is amended as follows:
0
a. By revising the definition for ``Designated Compliance Officer''.
0
b. By adding definitions for ``Dual-fuel'' and ``Flexible-fuel'' in 
alphabetical order.
0
c. By revising the definitions for ``Remanufacture system or 
remanufacturing system'', ``Sulfur-sensitive technology'', and ``Total 
hydrocarbon equivalent''.
    The revisions and addition read as follows:


Sec.  1033.901  Definitions.

* * * * *
    Designated Compliance Officer means the Director, Diesel Engine 
Compliance Center, U.S. Environmental Protection Agency, 2000 
Traverwood Drive, Ann Arbor, MI 48105; [email protected]; epa.gov/otaq/verify.
* * * * *
    Dual-fuel means relating to a locomotive designed for operation on 
two different fuels but not on a continuous mixture of those fuels (see 
Sec.  1033.601(f)). For purposes of this part, such a locomotive 
remains a dual-fuel locomotive even if it is designed for operation on 
three or more different fuels.
* * * * *
    Flexible-fuel means relating to a locomotive designed for operation 
on any mixture of two or more different fuels (see Sec.  1033.601(f)).
* * * * *
    Remanufacture system or remanufacturing system means all components 
(or specifications for components) and instructions necessary to 
remanufacture a locomotive or locomotive engine in accordance with 
applicable requirements of this part.
* * * * *
    Sulfur-sensitive technology means an emission control technology 
that would experience a significant drop in emission control 
performance or emission-system durability when a locomotive is operated 
on low-sulfur diesel fuel with a sulfur concentration of 300 to 500 ppm 
as compared to when it is operated on ultra low-sulfur diesel fuel 
(i.e., fuel with a sulfur concentration less than 15 ppm). Exhaust gas 
recirculation is not a sulfur-sensitive technology.
* * * * *
    Total hydrocarbon equivalent has the meaning given in 40 CFR 
1065.1001. This generally means the sum of the carbon mass 
contributions of non-oxygenated hydrocarbon, alcohols and aldehydes, or 
other organic compounds that are measured separately as contained in a 
gas sample, expressed as exhaust hydrocarbon from petroleum-fueled 
locomotives. The atomic hydrogen-to-carbon ratio of the equivalent 
hydrocarbon is 1.85:1.
* * * * *

0
134. Section 1033.915 is revised to read as follows:


Sec.  1033.915  Confidential information.

    The provisions of 40 CFR 1068.10 apply for information you consider 
confidential.

0
135. Section 1033.925 is revised to read as follows:


Sec.  1033.925  Reporting and recordkeeping requirements.

    (a) This part includes various requirements to submit and record 
data or other information. Unless we specify otherwise, store required 
records in any format and on any media and keep them readily available 
for eight years after you send an associated application for 
certification, or eight years after you generate the data if they do 
not support an application for certification. You are expected to keep 
your own copy of required records rather than relying on someone else 
to keep records on your behalf. We may review these records at any 
time. You must promptly send us organized, written records in English 
if we ask for them. We may require you to submit written records in an 
electronic format.
    (b) The regulations in Sec.  1033.255, 40 CFR 1068.25, and 40 CFR 
1068.101 describe your obligation to report truthful and complete 
information. This includes information not related to certification. 
Failing to properly report information and keep the records we specify 
violates 40 CFR 1068.101(a)(2), which may involve civil or criminal 
penalties.
    (c) Send all reports and requests for approval to the Designated 
Compliance Officer (see Sec.  1033.801).
    (d) Any written information we require you to send to or receive 
from another company is deemed to be a required record under this 
section. Such records are also deemed to be submissions to EPA. We may 
require you to send us these records whether or not you are a 
certificate holder.
    (e) Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.), the 
Office of Management and Budget approves the reporting and 
recordkeeping specified in the applicable regulations. Failing to 
properly report information and keep the records we specify violates 40 
CFR 1068.101(a)(2), which may involve civil or criminal penalties. The 
following items illustrate the kind of reporting and recordkeeping we 
require for locomotives regulated under this part:
    (1) We specify the following requirements related to locomotive 
certification in this part 1033:
    (i) In Sec.  1033.150 we include various reporting and 
recordkeeping requirements related to interim provisions.
    (ii) In subpart C of this part we identify a wide range of 
information required to certify engines.
    (iii) In Sec.  1033.325 we specify certain records related to 
production-line testing.

[[Page 74011]]

    (iv) In subpart G of this part we identify several reporting and 
recordkeeping items for making demonstrations and getting approval 
related to various special compliance provisions.
    (v) In Sec. Sec.  1033.725, 1033.730, and 1033.735 we specify 
certain records related to averaging, banking, and trading.
    (vi) In subpart I of this part we specify certain records related 
to meeting requirements for remanufactured engines.
    (2) We specify the following requirements related to testing in 40 
CFR part 1065:
    (i) In 40 CFR 1065.2 we give an overview of principles for 
reporting information.
    (ii) In 40 CFR 1065.10 and 1065.12 we specify information needs for 
establishing various changes to published test procedures.
    (iii) In 40 CFR 1065.25 we establish basic guidelines for storing 
test information.
    (iv) In 40 CFR 1065.695 we identify the specific information and 
data items to record when measuring emissions.
    (3) We specify the following requirements related to the general 
compliance provisions in 40 CFR part 1068:
    (i) In 40 CFR 1068.5 we establish a process for evaluating good 
engineering judgment related to testing and certification.
    (ii) In 40 CFR 1068.25 we describe general provisions related to 
sending and keeping information.
    (iii) In 40 CFR 1068.27 we require manufacturers to make 
locomotives available for our testing or inspection if we make such a 
request.
    (iv) In 40 CFR part 1068, subpart C, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to various exemptions.
    (v) In 40 CFR part 1068, subpart D, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to importing locomotives and engines.
    (vi) In 40 CFR 1068.450 and 1068.455 we specify certain records 
related to testing production-line locomotives in a selective 
enforcement audit.
    (vii) In 40 CFR 1068.501 we specify certain records related to 
investigating and reporting emission-related defects.
    (viii) In 40 CFR 1068.525 and 1068.530 we specify certain records 
related to recalling nonconforming locomotives.
    (ix) In 40 CFR part 1068, subpart G, we specify certain records for 
requesting a hearing.

0
136. Appendix I to part 1033 is added to read as follows:

Appendix I to Part 1033--Original Standards for Tier 0, Tier 1 and Tier 
2 Locomotives

    (a) The following emission standards applied for new locomotives 
not yet subject to this part 1033:

----------------------------------------------------------------------------------------------------------------
                                                                               Standards  (g/bhp-hr)
                                  Year of                        -----------------------------------------------
      Type of standard           original            Tier                                          PM-alternate
                                manufacture                             NOX         PM-primary          \1\
----------------------------------------------------------------------------------------------------------------
Line-haul...................       1973-1992  Tier 0............             9.5            0.60            0.30
                                   1993-2004  Tier 1............             7.4            0.45            0.22
                                   2005-2011  Tier 2............             5.5            0.20            0.10
Switch......................       1973-1992  Tier 0............            14.0            0.72            0.36
                                   1993-2004  Tier 1............            11.0            0.54            0.27
                                   2005-2011  Tier 2............             8.1            0.24            0.12
----------------------------------------------------------------------------------------------------------------
\1\ Locomotives certified to the alternate PM standards are also subject to alternate CO standards of 10.0 for
  the line-haul cycle and 12.0 for the switch cycle.

    (b) The original Tier 0, Tier 1, and Tier 2 standards for HC and 
CO emissions and smoke are the same standards identified in Sec.  
1033.101.


0
137. Part 1036 is revised to read as follows:

PART 1036--CONTROL OF EMISSIONS FROM NEW AND IN-USE HEAVY-DUTY 
HIGHWAY ENGINES

Subpart A--Overview and Applicability
Sec.
1036.1 Does this part apply for my engines?
1036.2 Who is responsible for compliance?
1036.5 Which engines are excluded from this part's requirements?
1036.10 How is this part organized?
1036.15 Do any other regulation parts apply to me?
1036.30 Submission of information.
Subpart B--Emission Standards and Related Requirements
1036.100 Overview of exhaust emission standards.
1036.108 Greenhouse gas emission standards.
1036.115 Other requirements.
1036.130 Installation instructions for vehicle manufacturers.
1036.135 Labeling.
1036.140 Primary intended service class and engine cycle.
1036.150 Interim provisions.
Subpart C--Certifying Engine Families
1036.205 What must I include in my application?
1036.210 Preliminary approval before certification.
1036.225 Amending my application for certification.
1036.230 Selecting engine families.
1036.235 Testing requirements for certification.
1036.241 Demonstrating compliance with greenhouse gas emission 
standards.
1036.250 Reporting and recordkeeping for certification.
1036.255 What decisions may EPA make regarding my certificate of 
conformity?
Subpart D--Testing Production Engines
1036.301 Measurements related to GEM inputs in a selective 
enforcement audit.
Subpart E--In-use Testing
1036.401 In-use testing.
Subpart F--Test Procedures
1036.501 How do I run a valid emission test?
1036.505 Ramped-modal testing procedures.
1036.510 Engine data and information for vehicle certification.
1036.525 Hybrid engines.
1036.530 Calculating greenhouse gas emission rates.
1036.535 Determining steady-state engine fuel maps and fuel 
consumption at idle.
1036.540 Determining cycle-average engine fuel maps.
Subpart G--Special Compliance Provisions
1036.601 What compliance provisions apply?
1036.605 GHG exemption for engines used in specialty vehicles.
1036.610 Off-cycle technology credits and adjustments for reducing 
greenhouse gas emissions.
1036.615 Engines with Rankine cycle waste heat recovery and hybrid 
powertrains.
1036.620 Alternate CO2 standards based on model year 2011 
compression-ignition engines.
1036.625 In-use compliance with family emission limits (FELs).

[[Page 74012]]

1036.630 Certification of engine GHG emissions for powertrain 
testing.
Subpart H--Averaging, Banking, and Trading for Certification
1036.701 General provisions.
1036.705 Generating and calculating emission credits.
1036.710 Averaging.
1036.715 Banking.
1036.720 Trading.
1036.725 What must I include in my application for certification?
1036.730 ABT reports.
1036.735 Recordkeeping.
1036.740 Restrictions for using emission credits.
1036.745 End-of-year CO2 credit deficits.
1036.750 What can happen if I do not comply with the provisions of 
this subpart?
1036.755 Information provided to the Department of Transportation.
Subpart I--Definitions and Other Reference Information
1036.801 Definitions.
1036.805 Symbols, abbreviations, and acronyms.
1036.810 Incorporation by reference.
1036.815 Confidential information.
1036.820 Requesting a hearing.
1036.825 Reporting and recordkeeping requirements.
Appendix I to Part 1036--Default Engine Fuel Maps for Sec.  1036.540

    Authority: 42 U.S.C. 7401--7671q.

Subpart A--Overview and Applicability


Sec.  1036.1  Does this part apply for my engines?

    (a) Except as specified in Sec.  1036.5, the provisions of this 
part apply for engines that will be installed in heavy-duty vehicles 
(including glider vehicles) above 14,000 pounds GVWR for propulsion. 
These provisions also apply for engines that will be installed in 
incomplete heavy-duty vehicles at or below 14,000 pounds GVWR unless 
the engine is installed in a vehicle that is covered by a certificate 
of conformity under 40 CFR part 86, subpart S.
    (b) This part does not apply with respect to exhaust emission 
standards for HC, CO, NOX, or PM except as follows:
    (1) The provisions of Sec.  1036.601 apply.
    (2) 40 CFR parts 85 and/or 86 may specify that certain provisions 
apply.
    (c) The provisions of this part also apply for fuel conversions of 
all engines described in paragraph (a) of this section as described in 
40 CFR 85.502.
    (d) Gas turbine heavy-duty engines and other heavy-duty engines not 
meeting the definition compression-ignition or spark-ignition are 
deemed to be compression-ignition engines for purposes of this part.


Sec.  1036.2  Who is responsible for compliance?

    The regulations in this part 1036 contain provisions that affect 
both engine manufacturers and others. However, the requirements of this 
part are generally addressed to the engine manufacturer(s). The term 
``you'' generally means the engine manufacturer(s), especially for 
issues related to certification. Additional requirements and 
prohibitions apply to other persons as specified in subpart G of this 
part and 40 CFR part 1068.


Sec.  1036.5  Which engines are excluded from this part's requirements?

    (a) The provisions of this part do not apply to engines used in 
medium-duty passenger vehicles or other heavy-duty vehicles that are 
subject to regulation under 40 CFR part 86, subpart S, except as 
specified in 40 CFR part 86, subpart S, and Sec.  1036.150(j). For 
example, this exclusion applies for engines used in vehicles certified 
to the standards of 40 CFR 86.1819.
    (b) An engine installed in a heavy-duty vehicle that is not used to 
propel the vehicle is not a heavy-duty engine. The provisions of this 
part therefore do not apply to these engines. Note that engines used to 
indirectly propel the vehicle (such as electrical generator engines 
that provide power to batteries for propulsion) are subject to this 
part. See 40 CFR part 1039, 1048, or 1054 for other requirements that 
apply for these auxiliary engines. See 40 CFR part 1037 for 
requirements that may apply for vehicles using these engines, such as 
the evaporative emission requirements of 40 CFR 1037.103.
    (c) The provisions of this part do not apply to aircraft or 
aircraft engines. Standards apply separately to certain aircraft 
engines, as described in 40 CFR part 87.
    (d) The provisions of this part do not apply to engines that are 
not internal combustion engines. For example, the provisions of this 
part do not apply to fuel cells. Note that gas turbine engines are 
internal combustion engines.
    (e) The provisions of this part do not apply for model year 2013 
and earlier heavy-duty engines unless they were:
    (1) Voluntarily certified to this part.
    (2) Installed in a glider vehicle subject to 40 CFR part 1037.


Sec.  1036.10  How is this part organized?

    This part 1036 is divided into the following subparts:
    (a) Subpart A of this part defines the applicability of this part 
1036 and gives an overview of regulatory requirements.
    (b) Subpart B of this part describes the emission standards and 
other requirements that must be met to certify engines under this part. 
Note that Sec.  1036.150 describes certain interim requirements and 
compliance provisions that apply only for a limited time.
    (c) Subpart C of this part describes how to apply for a certificate 
of conformity.
    (d) Subpart D of this part addresses testing of production engines.
    (e) Subpart E of this part describes provisions for testing in-use 
engines.
    (f) Subpart F of this part describes how to test your engines 
(including references to other parts of the Code of Federal 
Regulations).
    (g) Subpart G of this part describes requirements, prohibitions, 
and other provisions that apply to engine manufacturers, vehicle 
manufacturers, owners, operators, rebuilders, and all others.
    (h) Subpart H of this part describes how you may generate and use 
emission credits to certify your engines.
    (i) Subpart I of this part contains definitions and other reference 
information.


Sec.  1036.15  Do any other regulation parts apply to me?

    (a) Part 86 of this chapter describes additional requirements that 
apply to engines that are subject to this part 1036. This part 
extensively references portions of 40 CFR part 86. For example, the 
regulations of part 86 specify emission standards and certification 
procedures related to criteria pollutants.
    (b) Part 1037 of this chapter describes requirements for 
controlling evaporative emissions and greenhouse gas emissions from 
heavy-duty vehicles, whether or not they use engines certified under 
this part. It also includes standards and requirements that apply 
instead of the standards and requirements of this part in some cases.
    (c) Part 1065 of this chapter describes procedures and equipment 
specifications for testing engines to measure exhaust emissions. 
Subpart F of this part 1036 describes how to apply the provisions of 
part 1065 of this chapter to determine whether engines meet the exhaust 
emission standards in this part.
    (d) Certain provisions of part 1068 of this chapter apply as 
specified in Sec.  1036.601 to everyone, including anyone who 
manufactures, imports, installs, owns, operates, or rebuilds any of the 
engines subject to this part 1036, or vehicles containing these 
engines. Part 1068 of this chapter describes general provisions that 
apply broadly, but do not necessarily apply for all engines or all 
persons. See Sec.  1036.601 to

[[Page 74013]]

determine how to apply the part 1068 regulations for heavy-duty 
engines. The issues addressed by these provisions include these seven 
areas:
    (1) Prohibited acts and penalties for engine manufacturers, vehicle 
manufacturers, and others.
    (2) Rebuilding and other aftermarket changes.
    (3) Exclusions and exemptions for certain engines.
    (4) Importing engines.
    (5) Selective enforcement audits of your production.
    (6) Recall.
    (7) Procedures for hearings.
    (e) Other parts of this chapter apply if referenced in this part.


Sec.  1036.30  Submission of information.

    Unless we specify otherwise, send all reports and requests for 
approval to the Designated Compliance Officer (see Sec.  1036.801). See 
Sec.  1036.825 for additional reporting and recordkeeping provisions.

Subpart B--Emission Standards and Related Requirements


Sec.  1036.100  Overview of exhaust emission standards.

    Engines used in vehicles certified to the applicable chassis 
standards for greenhouse gases described in 40 CFR 86.1819 are not 
subject to the standards specified in this part. All other engines 
subject to this part must meet the greenhouse gas standards in Sec.  
1036.108 in addition to the criteria pollutant standards of 40 CFR part 
86.


Sec.  1036.108  Greenhouse gas emission standards.

    This section contains standards and other regulations applicable to 
the emission of the air pollutant defined as the aggregate group of six 
greenhouse gases: Carbon dioxide, nitrous oxide, methane, 
hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride. This 
section describes the applicable CO2, N2O, and 
CH4 standards for engines. These standards do not apply for 
engines used in vehicles subject to (or voluntarily certified to) the 
CO2, N2O, and CH4 standards for 
vehicles specified in 40 CFR 86.1819.
    (a) Emission standards. Emission standards apply for engines 
measured using the test procedures specified in subpart F of this part 
as follows:
    (1) CO2 emission standards in this paragraph (a)(1) 
apply based on testing as specified in subpart F of this part. The 
applicable test cycle for measuring CO2 emissions differs 
depending on the engine family's primary intended service class and the 
extent to which the engines will be (or were designed to be) used in 
tractors. For medium and heavy heavy-duty engines certified as tractor 
engines, measure CO2 emissions using the steady-state duty 
cycle specified in 40 CFR 86.1362 (referred to as the ramped-modal 
cycle, or RMC, even though emission sampling involves measurements from 
discrete modes). This is intended for engines designed to be used 
primarily in tractors and other line-haul applications. Note that the 
use of some RMC-certified tractor engines in vocational applications 
does not affect your certification obligation under this paragraph 
(a)(1); see other provisions of this part and 40 CFR part 1037 for 
limits on using engines certified to only one cycle. For medium and 
heavy heavy-duty engines certified as both tractor and vocational 
engines, measure CO2 emissions using the steady-state duty 
cycle and the transient duty cycle (sometimes referred to as the FTP 
engine cycle), both of which are specified in 40 CFR part 86, subpart 
N. This is intended for engines that are designed for use in both 
tractor and vocational applications. For all other engines (including 
engines meeting spark-ignition standards), measure CO2 
emissions using the appropriate transient duty cycle specified in 40 
CFR part 86, subpart N.
    (i) The CO2 standard is 627 g/hp-hr for all spark-
ignition engines for model years 2016 through 2020. This standard 
continues to apply in later model years for all spark-ignition engines 
that are not heavy heavy-duty engines.
    (ii) The following CO2 standards apply for compression-
ignition engines (in g/hp-hr):

----------------------------------------------------------------------------------------------------------------
                                                  Medium  heavy-   Heavy  heavy-
           Model years             Light  heavy-      duty--          duty--      Medium  heavy-   Heavy  heavy-
                                       duty         vocational      vocational    duty-- tractor  duty-- tractor
----------------------------------------------------------------------------------------------------------------
2014-2016.......................             600             600             567             502             475
2017-2020.......................             576             576             555             487             460
----------------------------------------------------------------------------------------------------------------

    (iii) The following CO2 standards apply for compression-
ignition engines and all heavy heavy-duty engines (in g/hp-hr):

----------------------------------------------------------------------------------------------------------------
                                                  Medium  heavy-   Heavy  heavy-
           Model years             Light  heavy-      duty--          duty--      Medium  heavy-   Heavy  heavy-
                                       duty         vocational      vocational    duty-- tractor  duty-- tractor
----------------------------------------------------------------------------------------------------------------
2021-2023.......................             563             545             513             473             447
2024-2026.......................             555             538             506             461             436
2027 and later..................             552             535             503             457             432
----------------------------------------------------------------------------------------------------------------

    (iv) You may certify spark-ignition engines to the compression-
ignition standards for the appropriate model year under this paragraph 
(a). If you do this, those engines are treated as compression-ignition 
engines for all the provisions of this part.
    (2) The CH4 emission standard is 0.10 g/hp-hr when 
measured over the applicable transient duty cycle specified in 40 CFR 
part 86, subpart N. This standard begins in model year 2014 for 
compression-ignition engines and in model year 2016 for spark-ignition 
engines. Note that this standard applies for all fuel types just like 
the other standards of this section.
    (3) The N2O emission standard is 0.10 g/hp-hr when 
measured over the transient duty cycle specified in 40 CFR part 86, 
subpart N. This standard begins in model year 2014 for compression-
ignition engines and in model year 2016 for spark-ignition engines.
    (b) Family Certification Levels. You must specify a CO2 
Family Certification Level (FCL) for each engine family. The FCL may 
not be less than the certified emission level for the engine family. 
The CO2 Family Emission Limit (FEL) for the engine family is 
equal to the FCL multiplied by 1.03.

[[Page 74014]]

    (c) Averaging, banking, and trading. You may generate or use 
emission credits under the averaging, banking, and trading (ABT) 
program described in subpart H of this part for demonstrating 
compliance with CO2 emission standards. Credits (positive 
and negative) are calculated from the difference between the FCL and 
the applicable emission standard. As described in Sec.  1036.705, you 
may use CO2 credits to certify your engine families to FELs 
for N2O and/or CH4, instead of the 
N2O/CH4 standards of this section that otherwise 
apply. Except as specified in Sec. Sec.  1036.150 and 1036.705, you may 
not generate or use credits for N2O or CH4 
emissions.
    (d) Useful life. The exhaust emission standards of this section 
apply for the full useful life, expressed in service miles, operating 
hours, or calendar years, whichever comes first. The useful life values 
applicable to the criteria pollutant standards of 40 CFR part 86 apply 
for the standards of this section, except that the spark-ignition 
standards and the standards for model year 2021 and later light heavy-
duty compression-ignition engines apply over a useful life of 15 years 
or 150,000 miles, whichever comes first.
    (e) Applicability for testing. The emission standards in this 
subpart apply as specified in this paragraph (e) to all duty-cycle 
testing (according to the applicable test cycles) of testable 
configurations, including certification, selective enforcement audits, 
and in-use testing. The CO2 FCLs serve as the CO2 
emission standards for the engine family with respect to certification 
and confirmatory testing instead of the standards specified in 
paragraph (a)(1) of this section. The FELs serve as the emission 
standards for the engine family with respect to all other duty-cycle 
testing. See Sec. Sec.  1036.235 and 1036.241 to determine which engine 
configurations within the engine family are subject to testing. Note 
that engine fuel maps and powertrain test results also serve as 
standards as described in Sec.  1036.535, Sec.  1036.540, Sec.  
1036.630 and 40 CFR 1037.550.
    (f) Multi-fuel engines. For dual-fuel, multi-fuel, and flexible-
fuel engines, perform exhaust testing on each fuel type (for example, 
gasoline and E85).
    (1) This paragraph (f)(1) applies where you demonstrate the 
relative amount of each fuel type that your engines consume in actual 
use. Based on your demonstration, we will specify a weighting factor 
and allow you to submit the weighted average of your emission results. 
For example, if you certify an E85 flexible-fuel engine and we 
determine the engine will produce one-half of its work from E85 and 
one-half of its work from gasoline, you may apply a 50 percent 
weighting factor to each of your E85 and gasoline emission results.
    (2) If you certify your engine family to N2O and/or 
CH4 FELs the FELs apply for testing on all fuel types for 
which your engine is designed, to the same extent as criteria emission 
standards apply.


Sec.  1036.115  Other requirements.

    (a) The warranty and maintenance requirements, adjustable parameter 
provisions, and defeat device prohibition of 40 CFR part 86 apply with 
respect to the standards of this part.
    (b) You must perform fuel mapping for your engine as described in 
Sec.  1036.510(b).
    (c) You must design and produce your engines to comply with 
evaporative emission standards as follows:
    (1) For complete heavy-duty vehicles you produce, you must certify 
the vehicles to emission standards as specified in 40 CFR 1037.103.
    (2) For incomplete heavy-duty vehicles, and for engines used in 
vehicles you do not produce, you do not need to certify your engines to 
evaporative emission standards or otherwise meet those standards. 
However, vehicle manufacturers certifying their vehicles with your 
engines may depend on you to produce your engines according to their 
specifications. Also, your engines must meet applicable exhaust 
emission standards in the installed configuration.


Sec.  1036.130  Installation instructions for vehicle manufacturers.

    (a) If you sell an engine for someone else to install in a vehicle, 
give the engine installer instructions for installing it consistent 
with the requirements of this part. Include all information necessary 
to ensure that an engine will be installed in its certified 
configuration.
    (b) Make sure these instructions have the following information:
    (1) Include the heading: ``Emission-related installation 
instructions''.
    (2) State: ``Failing to follow these instructions when installing a 
certified engine in a heavy-duty motor vehicle violates federal law, 
subject to fines or other penalties as described in the Clean Air 
Act.''
    (3) Provide all instructions needed to properly install the exhaust 
system and any other components.
    (4) Describe any necessary steps for installing any diagnostic 
system required under 40 CFR part 86.
    (5) Describe how your certification is limited for any type of 
application. For example, if you certify heavy heavy-duty engines to 
the CO2 standards using only transient FTP testing, you must 
make clear that the engine may not be installed in tractors.
    (6) Describe any other instructions to make sure the installed 
engine will operate according to design specifications in your 
application for certification. This may include, for example, 
instructions for installing aftertreatment devices when installing the 
engines.
    (7) State: ``If you install the engine in a way that makes the 
engine's emission control information label hard to read during normal 
engine maintenance, you must place a duplicate label on the vehicle, as 
described in 40 CFR 1068.105.''
    (c) Give the vehicle manufacturer fuel map results as described in 
Sec.  1036.510(b).
    (d) You do not need installation instructions for engines that you 
install in your own vehicles.
    (e) Provide instructions in writing or in an equivalent format. For 
example, you may post instructions on a publicly available Web site for 
downloading or printing. If you do not provide the instructions in 
writing, explain in your application for certification how you will 
ensure that each installer is informed of the installation 
requirements.


Sec.  1036.135  Labeling.

    Label your engines as described in 40 CFR 86.007-35(a)(3), with the 
following additional information:
    (a) [Reserved]
    (b) Identify the emission control system. Use terms and 
abbreviations as described in 40 CFR 1068.45 or other applicable 
conventions.
    (c) Identify any limitations on your certification. For example, if 
you certify heavy heavy-duty engines to the CO2 standards 
using only transient cycle testing, include the statement ``VOCATIONAL 
VEHICLES ONLY''.
    (d) You may ask us to approve modified labeling requirements in 
this part 1036 if you show that it is necessary or appropriate. We will 
approve your request if your alternate label is consistent with the 
requirements of this part. We may also specify modified labeling 
requirement to be consistent with the intent of 40 CFR part 1037.


Sec.  1036.140  Primary intended service class and engine cycle.

    You must identify a single primary intended service class for each 
engine family that best describes vehicles for which you design and 
market the engine, as follows:

[[Page 74015]]

    (a) Divide compression-ignition engines into primary intended 
service classes based on the following engine and vehicle 
characteristics:
    (1) Light heavy-duty engines usually are not designed for rebuild 
and do not have cylinder liners. Vehicle body types in this group might 
include any heavy-duty vehicle built from a light-duty truck chassis, 
van trucks, multi-stop vans, and some straight trucks with a single 
rear axle. Typical applications would include personal transportation, 
light-load commercial delivery, passenger service, agriculture, and 
construction. The GVWR of these vehicles is normally at or below 19,500 
pounds.
    (2) Medium heavy-duty engines may be designed for rebuild and may 
have cylinder liners. Vehicle body types in this group would typically 
include school buses, straight trucks with single rear axles, city 
tractors, and a variety of special purpose vehicles such as small dump 
trucks, and refuse trucks. Typical applications would include 
commercial short haul and intra-city delivery and pickup. Engines in 
this group are normally used in vehicles whose GVWR ranges from 19,501 
to 33,000 pounds.
    (3) Heavy heavy-duty engines are designed for multiple rebuilds and 
have cylinder liners. Vehicles in this group are normally tractors, 
trucks, straight trucks with dual rear axles, and buses used in inter-
city, long-haul applications. These vehicles normally exceed 33,000 
pounds GVWR.
    (b) Divide spark-ignition engines into primary intended service 
classes as follows:
    (1) Spark-ignition engines that are best characterized by paragraph 
(a)(1) or (2) of this section are in a separate ``spark-ignition'' 
primary intended service class.
    (2) Spark-ignition engines that are best characterized by paragraph 
(a)(3) of this section share a primary intended service class with 
compression-ignition heavy heavy-duty engines. Gasoline-fueled engines 
are presumed not to be characterized by paragraph (a)(3) of this 
section; for example, vehicle manufacturers may install some number of 
gasoline-fueled engines in Class 8 trucks without causing the engine 
manufacturer to consider those to be heavy heavy-duty engines.
    (c) References to ``spark-ignition standards'' in this part relate 
only to the spark-ignition engines identified in paragraph (b)(1) of 
this section. References to ``compression-ignition standards'' in this 
part relate to compression-ignition engines, to spark-ignition engines 
optionally certified to standards that apply to compression-ignition 
engines, and to all engines identified under paragraph (b)(2) of this 
section as heavy heavy-duty engines.


Sec.  1036.150  Interim provisions.

    The provisions in this section apply instead of other provisions in 
this part.
    (a) Early banking of greenhouse gas emissions. You may generate 
CO2 emission credits for engines you certify in model year 
2013 (2015 for spark-ignition engines) to the standards of Sec.  
1036.108.
    (1) Except as specified in paragraph (a)(2) of this section, to 
generate early credits, you must certify your entire U.S.-directed 
production volume within that averaging set to these standards. This 
means that you may not generate early credits while you produce engines 
in the averaging set that are certified to the criteria pollutant 
standards but not to the greenhouse gas standards. Calculate emission 
credits as described in subpart H of this part relative to the standard 
that would apply for model year 2014 (2016 for spark-ignition engines).
    (2) You may generate early credits for an individual compression-
ignition engine family where you demonstrate that you have improved a 
model year 2013 engine model's CO2 emissions relative to its 
2012 baseline level and certify it to an FCL below the applicable 
standard. Calculate emission credits as described in subpart H of this 
part relative to the lesser of the standard that would apply for model 
year 2014 engines or the baseline engine's CO2 emission 
rate. Use the smaller U.S.-directed production volume of the 2013 
engine family or the 2012 baseline engine family. We will not allow you 
to generate emission credits under this paragraph (a)(2) unless we 
determine that your 2013 engine is the same engine as the 2012 baseline 
or that it replaces it.
    (3) You may bank credits equal to the surplus credits you generate 
under this paragraph (a) multiplied by 1.50. For example, if you have 
10 Mg of surplus credits for model year 2013, you may bank 15 Mg of 
credits. Credit deficits for an averaging set prior to model year 2014 
(2016 for spark-ignition engines) do not carry over to model year 2014 
(2016 for spark-ignition engines). We recommend that you notify us of 
your intent to use this provision before submitting your applications.
    (b) Model year 2014 N2O standards. In model year 2014 and earlier, 
manufacturers may show compliance with the N2O standards 
using an engineering analysis. This allowance also applies for later 
families certified using carryover CO2 data from model 2014 
consistent with Sec.  1036.235(d).
    (c) Engine cycle classification. Through model year 2020, engines 
meeting the definition of spark-ignition, but regulated as diesel 
engines under 40 CFR part 86, must be certified to the requirements 
applicable to compression-ignition engines under this part. Such 
engines are deemed to be compression-ignition engines for purposes of 
this part. Similarly, through model year 2020, engines meeting the 
definition of compression-ignition, but regulated as Otto-cycle under 
40 CFR part 86 must be certified to the requirements applicable to 
spark-ignition engines under this part. Such engines are deemed to be 
spark-ignition engines for purposes of this part. See Sec.  1036.140 
for provisions that apply for model year 2021 and later.
    (d) Small manufacturers. The standards of this part apply on a 
delayed schedule for manufacturers meeting the small business criteria 
specified in 13 CFR 121.201. Apply the small business criteria for 
NAICS code 336310 for engine manufacturers with respect to gasoline-
fueled engines and 333618 for engine manufacturers with respect to 
other engines; the employee limits apply to the total number employees 
together for affiliated companies. Qualifying small manufacturers are 
not subject to the greenhouse gas emission standards in Sec.  1036.108 
for engines with a date of manufacture on or after November 14, 2011 
but before January 1, 2022. In addition, qualifying small manufacturers 
producing engines that run on any fuel other than gasoline, E85, or 
diesel fuel may delay complying with every later standard under this 
part by one model year. Small manufacturers may certify their engines 
and generate emission credits under this part 1036 before standards 
start to apply, but only if they certify their entire U.S.-directed 
production volume within that averaging set for that model year. Note 
that engines not yet subject to standards must nevertheless supply fuel 
maps to vehicle manufacturers as described in paragraph (n) of this 
section. Note also that engines produced by small manufacturers are 
subject to criteria pollutant standards.
    (e) Alternate phase-in standards. Where a manufacturer certifies 
all of its model year 2013 compression-ignition engines within a given 
primary intended service class to the applicable alternate standards of 
this paragraph (e), its compression-ignition engines within that 
primary intended service class are subject to the standards of this 
paragraph (e) for model years 2013

[[Page 74016]]

through 2016. This means that once a manufacturer chooses to certify a 
primary intended service class to the standards of this paragraph (e), 
it is not allowed to opt out of these standards. Engines certified to 
these standards are not eligible for early credits under paragraph (a) 
of this section.

----------------------------------------------------------------------------------------------------------------
             Tractors                      LHD Engines               MHD Engines               HHD Engines
----------------------------------------------------------------------------------------------------------------
Model Years 2013-2015.............  NA......................  512 g/hp-hr.............  485 g/hp-hr.
Model Years 2016 and later \1\....  NA......................  487 g/hp-hr.............  460 g/hp-hr.
----------------------------------------------------------------------------------------------------------------
Vocational........................         LHD Engines               MHD Engines               HHD Engines
----------------------------------------------------------------------------------------------------------------
Model Years 2013-2015.............  618 g/hp-hr.............  618 g/hp-hr.............  577 g/hp-hr.
Model Years 2016 through 2020 \a\.  576 g/hp-hr.............  576 g/hp-hr.............  555 g/hp-hr.
----------------------------------------------------------------------------------------------------------------
\1\ Note: these alternate standards for 2016 and later are the same as the otherwise applicable standards for
  2017 through 2020.

    (f) Separate OBD families. This paragraph (f) applies where you 
separately certify engines for the purpose of applying OBD requirements 
(for engines used in vehicles under 14,000 pounds GVWR) from non-OBD 
engines that could be certified as a single engine family. You may 
treat the two engine families as a single engine family in certain 
respects for the purpose of this part, as follows:
    (1) This paragraph (f) applies only where the two families are 
identical in all respects except for the engine ratings offered and the 
inclusion of OBD.
    (2) For purposes of this part and 40 CFR part 86, the two families 
remain two separate families except for the following:
    (i) Specify the testable configurations of the non-OBD engine 
family as the testable configurations for the OBD family.
    (ii) Submit the same CO2, N2O, and 
CH4 emission data for both engine families.
    (g) Assigned deterioration factors. You may use assigned 
deterioration factors (DFs) without performing your own durability 
emission tests or engineering analysis as follows:
    (1) You may use an assigned additive DF of 0.0 g/hp-hr for 
CO2 emissions from engines that do not use advanced or off-
cycle technologies. If we determine it to be consistent with good 
engineering judgment, we may allow you to use an assigned additive DF 
of 0.0 g/hp-hr for CO2 emissions from your engines with 
advanced or off-cycle technologies.
    (2) You may use an assigned additive DF of 0.020 g/hp-hr for 
N2O emissions from any engine through model year 2020, and 
0.010 g/hp-hr for later model years.
    (3) You may use an assigned additive DF of 0.020 g/hp-hr for 
CH4 emissions from any engine.
    (h) Advanced-technology credits. If you generate credits from model 
year 2020 and earlier engines certified for advanced technology, you 
may multiply these credits by 1.5, except that you may not apply this 
multiplier and the early-credit multiplier of paragraph (a) of this 
section.
    (i) CO2 credits for low N2O emissions. If you certify your model 
year 2014, 2015, or 2016 engines to an N2O FEL less than 
0.04 g/hp-hr (provided you measure N2O emissions from your 
emission-data engines), you may generate additional CO2 
credits under this paragraph (i). Calculate the additional 
CO2 credits from the following equation instead of the 
equation in Sec.  1036.705:

CO2 Credits (Mg) = (0.04-FELN2O) [middot] (CF) 
[middot] (Volume) [middot] (UL) [middot] (10-6) [middot] 
(298)

    (j) Alternate standards under 40 CFR part 86. This paragraph (j) 
describes alternate emission standards for loose engines certified 
under 40 CFR 86.1819-14(k)(8). The standards of Sec.  1036.108 do not 
apply for these engines. The standards in this paragraph (j) apply for 
emissions measured with the engine installed in a complete vehicle 
consistent with the provisions of 40 CFR 86.1819-14(k)(8)(vi). The only 
requirements of this part that apply to these engines are those in this 
paragraph (j), Sec. Sec.  1036.115 through 1036.135, 1036.535, and 
1036.540.
    (k) [Reserved]
    (l) Credit adjustment for spark-ignition engines and light heavy-
duty compression-ignition engines. For emission credits generated from 
model year 2020 and earlier engines subject to spark-ignition standards 
and light heavy-duty compression-ignition engines, multiply any banked 
credits that you carry forward to demonstrate compliance with model 
year 2021 and later standards by 1.36.
    (m) Infrequent regeneration. For model year 2020 and earlier, you 
may invalidate any test interval with respect to CO2 
measurements if an infrequent regeneration event occurs during the test 
interval. Note that Sec.  1036.530 specifies how to apply infrequent 
regeneration adjustment factors for later model years.
    (n) Supplying fuel maps. Engine manufacturers not yet subject to 
standards under Sec.  1036.108 in model year 2021 must supply vehicle 
manufacturers with fuel maps (or powertrain test results) as described 
in Sec.  1036.130 for those engines.
    (o) Engines used in glider vehicles. For purposes of recertifying a 
used engine for installation in a glider vehicle, we may allow you to 
include in an existing certified engine family those engines you modify 
(or otherwise demonstrate) to be identical to engines already covered 
by the certificate. We would base such an approval on our review of any 
appropriate documentation. These engines must have emission control 
information labels that accurately describe their status.
    (p) Transition to Phase 2 CO2 standards. If you certify 
all your model year 2020 engines within an averaging set to the model 
year 2021 FTP and SET standards and requirements, you may apply the 
provisions of this paragraph (p) for enhanced generation and use of 
emission credits. These provisions apply separately for medium heavy-
duty engines and heavy heavy-duty engines.
    (1) GHG emission credits you generate with model year 2018 through 
2024 engines may be used through model year 2030, instead of being 
limited to a five-year credit life as specified in Sec.  1036.740(d).
    (2) You may certify your model year 2024 through 2026 engines to 
the following alternative standards:

[[Page 74017]]



----------------------------------------------------------------------------------------------------------------
                                               Medium  heavy-   Heavy  heavy-
                 Model years                       duty--           duty--       Medium  heavy-   Heavy  heavy-
                                                 vocational       vocational     duty-- tractor   duty--tractor
----------------------------------------------------------------------------------------------------------------
2024-2026...................................             538              506              467              442
----------------------------------------------------------------------------------------------------------------

Subpart C--Certifying Engine Families


Sec.  1036.205  What must I include in my application?

    Submit an application for certification as described in 40 CFR 
86.007-21, with the following additional information:
    (a) Describe the engine family's specifications and other basic 
parameters of the engine's design and emission controls with respect to 
compliance with the requirements of this part. Describe in detail all 
system components for controlling greenhouse gas emissions, including 
all auxiliary emission control devices (AECDs) and all fuel-system 
components you will install on any production or test engine. Identify 
the part number of each component you describe. For this paragraph (a), 
treat as separate AECDs any devices that modulate or activate 
differently from each other.
    (b) Describe any test equipment and procedures that you used if you 
performed any tests that did not also involve measurement of criteria 
pollutants. Describe any special or alternate test procedures you used 
(see 40 CFR 1065.10(c)).
    (c) Include the emission-related installation instructions you will 
provide if someone else installs your engines in their vehicles (see 
Sec.  1036.130).
    (d) Describe the label information specified in Sec.  1036.135. We 
may require you to include a copy of the label.
    (e) Identify the CO2 FCLs with which you are certifying 
engines in the engine family; also identify any FELs that apply for 
CH4 and N2O. The actual U.S.-directed production 
volume of configurations that have CO2 emission rates at or 
below the FCL and CH4 and N2O emission rates at 
or below the applicable standards or FELs must be at least one percent 
of your actual (not projected) U.S.-directed production volume for the 
engine family. Identify configurations within the family that have 
emission rates at or below the FCL and meet the one percent 
requirement. For example, if your U.S.-directed production volume for 
the engine family is 10,583 and the U.S.-directed production volume for 
the tested rating is 75 engines, then you can comply with this 
provision by setting your FCL so that one more rating with a U.S.-
directed production volume of at least 31 engines meets the FCL. Where 
applicable, also identify other testable configurations required under 
Sec.  1036.230(b)(2).
    (f) Identify the engine family's deterioration factors and describe 
how you developed them (see Sec.  1036.241). Present any test data you 
used for this.
    (g) Present emission data to show that you meet emission standards, 
as follows:
    (1) Present exhaust emission data for CO2, 
CH4, and N2O on an emission-data engine to show 
that your engines meet the applicable emission standards we specify in 
Sec.  1036.108. Show emission figures before and after applying 
deterioration factors for each engine. In addition to the composite 
results, show individual measurements for cold-start testing and hot-
start testing over the transient test cycle. For each of these tests, 
also include the corresponding exhaust emission data for criteria 
emissions. Note that Sec.  1036.235 allows you to submit an application 
in certain cases without new emission data.
    (2) [Reserved]
    (h) State whether your certification is limited for certain 
engines. For example, if you certify heavy heavy-duty engines to the 
CO2 standards using only transient testing, the engines may 
be installed only in vocational vehicles.
    (i) Unconditionally certify that all the engines in the engine 
family comply with the requirements of this part, other referenced 
parts of the CFR, and the Clean Air Act. Note that Sec.  1036.235 
specifies which engines to test to show that engines in the entire 
family comply with the requirements of this part.
    (j) Include the information required by other subparts of this 
part. For example, include the information required by Sec.  1036.725 
if you participate in the ABT program.
    (k) Include the warranty statement and maintenance instructions if 
we request them.
    (l) Include other applicable information, such as information 
specified in this part or 40 CFR part 1068 related to requests for 
exemptions.
    (m) For imported engines or equipment, identify the following:
    (1) Describe your normal practice for importing engines. For 
example, this may include identifying the names and addresses of any 
agents you have authorized to import your engines. Engines imported by 
nonauthorized agents are not covered by your certificate.
    (2) The location of a test facility in the United States where you 
can test your engines if we select them for testing under a selective 
enforcement audit, as specified in 40 CFR part 1068, subpart E.
    (n) Include information needed to certify vehicles to GHG standards 
under 40 CFR part 1037 as described in Sec.  1036.510.


Sec.  1036.210  Preliminary approval before certification.

    If you send us information before you finish the application, we 
may review it and make any appropriate determinations, especially for 
questions related to engine family definitions, auxiliary emission 
control devices, adjustable parameters, deterioration factors, testing 
for service accumulation, and maintenance. Decisions made under this 
section are considered to be preliminary approval, subject to final 
review and approval. We will generally not reverse a decision where we 
have given you preliminary approval, unless we find new information 
supporting a different decision. If you request preliminary approval 
related to the upcoming model year or the model year after that, we 
will make best-efforts to make the appropriate determinations as soon 
as practicable. We will generally not provide preliminary approval 
related to a future model year more than two years ahead of time.


Sec.  1036.225  Amending my application for certification.

    Before we issue you a certificate of conformity, you may amend your 
application to include new or modified engine configurations, subject 
to the provisions of this section. After we have issued your 
certificate of conformity, you may send us an amended application 
requesting that we include new or modified engine configurations within 
the scope of the certificate, subject to the provisions of this 
section. You must also amend your application if any changes occur with 
respect to any information that is included or should be included in 
your application.
    (a) You must amend your application before you take any of the 
following actions:
    (1) Add an engine configuration to an engine family. In this case, 
the engine

[[Page 74018]]

configuration added must be consistent with other engine configurations 
in the engine family with respect to the criteria listed in Sec.  
1036.230.
    (2) Change an engine configuration already included in an engine 
family in a way that may affect emissions, or change any of the 
components you described in your application for certification. This 
includes production and design changes that may affect emissions any 
time during the engine's lifetime.
    (3) Modify an FEL and FCL for an engine family as described in 
paragraph (f) of this section.
    (b) To amend your application for certification, send the relevant 
information to the Designated Compliance Officer.
    (1) Describe in detail the addition or change in the engine model 
or configuration you intend to make.
    (2) Include engineering evaluations or data showing that the 
amended engine family complies with all applicable requirements. You 
may do this by showing that the original emission-data engine is still 
appropriate for showing that the amended family complies with all 
applicable requirements.
    (3) If the original emission-data engine for the engine family is 
not appropriate to show compliance for the new or modified engine 
configuration, include new test data showing that the new or modified 
engine configuration meets the requirements of this part.
    (4) Include any other information needed to make your application 
correct and complete.
    (c) We may ask for more test data or engineering evaluations. You 
must give us these within 30 days after we request them.
    (d) For engine families already covered by a certificate of 
conformity, we will determine whether the existing certificate of 
conformity covers your newly added or modified engine. You may ask for 
a hearing if we deny your request (see Sec.  1036.820).
    (e) For engine families already covered by a certificate of 
conformity, you may start producing the new or modified engine 
configuration any time after you send us your amended application and 
before we make a decision under paragraph (d) of this section. However, 
if we determine that the affected engines do not meet applicable 
requirements, we will notify you to cease production of the engines and 
may require you to recall the engines at no expense to the owner. 
Choosing to produce engines under this paragraph (e) is deemed to be 
consent to recall all engines that we determine do not meet applicable 
emission standards or other requirements and to remedy the 
nonconformity at no expense to the owner. If you do not provide 
information required under paragraph (c) of this section within 30 days 
after we request it, you must stop producing the new or modified 
engines.
    (f) You may ask us to approve a change to your FEL in certain cases 
after the start of production, but before the end of the model year. If 
you change an FEL for CO2, your FCL for CO2 is 
automatically set to your new FEL divided by 1.03. The changed FEL may 
not apply to engines you have already introduced into U.S. commerce, 
except as described in this paragraph (f). You may ask us to approve a 
change to your FEL in the following cases:
    (1) You may ask to raise your FEL for your engine family at any 
time. In your request, you must show that you will still be able to 
meet the emission standards as specified in subparts B and H of this 
part. Use the appropriate FELs/FCLs with corresponding production 
volumes to calculate emission credits for the model year, as described 
in subpart H of this part.
    (2) You may ask to lower the FEL for your engine family only if you 
have test data from production engines showing that emissions are below 
the proposed lower FEL (or below the proposed FCL for CO2). 
The lower FEL/FCL applies only to engines you produce after we approve 
the new FEL/FCL. Use the appropriate FELs/FCLs with corresponding 
production volumes to calculate emission credits for the model year, as 
described in subpart H of this part.
    (g) You may produce engines as described in your amended 
application for certification and consider those engines to be in a 
certified configuration if we approve a new or modified engine 
configuration during the model year under paragraph (d) of this 
section. Similarly, you may modify in-use engines as described in your 
amended application for certification and consider those engines to be 
in a certified configuration if we approve a new or modified engine 
configuration at any time under paragraph (d) of this section. 
Modifying a new or in-use engine to be in a certified configuration 
does not violate the tampering prohibition of 40 CFR 1068.101(b)(1), as 
long as this does not involve changing to a certified configuration 
with a higher family emission limit.


Sec.  1036.230  Selecting engine families.

    See 40 CFR 86.001-24 for instructions on how to divide your product 
line into families of engines that are expected to have similar 
emission characteristics throughout the useful life. You must certify 
your engines to the standards of Sec.  1036.108 using the same engine 
families you use for criteria pollutants under 40 CFR part 86. The 
following provisions also apply:
    (a) Engines certified as hybrid engines may not be included in an 
engine family with engines with conventional powertrains. Note that 
this does not prevent you from including engines in a conventional 
family if they are used in hybrid vehicles, as long as you certify them 
conventionally.
    (b) If you certify engines in the family for use as both vocational 
and tractor engines, you must split your family into two separate 
subfamilies. Indicate in the application for certification that the 
engine family is to be split.
    (1) Calculate emission credits relative to the vocational engine 
standard for the number of engines sold into vocational applications 
and relative to the tractor engine standard for the number of engines 
sold into non-vocational tractor applications. You may assign the 
numbers and configurations of engines within the respective subfamilies 
at any time before submitting the end-of-year report required by Sec.  
1036.730. If the family participates in averaging, banking, or trading, 
you must identify the type of vehicle in which each engine is 
installed; we may alternatively allow you to use statistical methods to 
determine this for a fraction of your engines. Keep records to document 
this determination.
    (2) If you restrict use of the test configuration for your split 
family to only tractors, or only vocational vehicles, you must identify 
a second testable configuration for the other type of vehicle (or an 
unrestricted configuration). Identify this configuration in your 
application for certification. The FCL for the engine family applies 
for this configuration as well as the primary test configuration.
    (c) If you certify in separate engine families engines that could 
have been certified in vocational and tractor engine subfamilies in the 
same engine family, count the two families as one family for purposes 
of determining your obligations with respect to the OBD requirements 
and in-use testing requirements of 40 CFR part 86. Indicate in the 
applications for certification that the two engine families are covered 
by this paragraph (c).
    (d) Engine configurations within an engine family must use 
equivalent greenhouse gas emission controls. Unless we approve it, you 
may not produce nontested configurations without the same emission 
control hardware included on the tested

[[Page 74019]]

configuration. We will only approve it if you demonstrate that the 
exclusion of the hardware does not increase greenhouse gas emissions.
    (e) If you certify both engine fuel maps and powertrain fuel maps 
for an engine family, you may split the engine family into two separate 
subfamilies. Indicate this in your application for certification, and 
identify whether one or both of these sets of fuel maps applies for 
each group of engines. If you do not split your family, all engines 
within the family must conform to the engine fuel maps, including any 
engines for with the powertrain maps also apply.


Sec.  1036.235  Testing requirements for certification.

    This section describes the emission testing you must perform to 
show compliance with the greenhouse gas emission standards in Sec.  
1036.108.
    (a) Select a single emission-data engine from each engine family as 
specified in 40 CFR part 86. The standards of this part apply only with 
respect to emissions measured from this tested configuration and other 
configurations identified in Sec.  1036.205(e). Note that 
configurations identified in Sec.  1036.205(e) are considered to be 
``tested configurations''. Whether or not you actually tested them for 
certification. However, you must apply the same (or equivalent) 
emission controls to all other engine configurations in the engine 
family. In other contexts, the tested configuration is sometimes 
referred to as the ``parent configuration'', although the terms are not 
synonymous.
    (b) Test your emission-data engines using the procedures and 
equipment specified in subpart F of this part. In the case of dual-fuel 
and flexible-fuel engines, measure emissions when operating with each 
type of fuel for which you intend to certify the engine. (Note: 
measurement of criteria emissions from flexible-fuel engines generally 
involves operation with the fuel mixture that best represents in-use 
operation, or with the fuel mixture with the highest emissions.) 
Measure CO2, CH4, and N2O emissions 
using the specified duty cycle(s), including cold-start and hot-start 
testing as specified in 40 CFR part 86, subpart N. The following 
provisions apply regarding test cycles for demonstrating compliance 
with tractor and vocational standards:
    (1) If you are certifying the engine for use in tractors, you must 
measure CO2 emissions using the applicable ramped-modal 
cycle specified in Sec.  1036.505, and measure CH4, and 
N2O emissions using the specified transient cycle.
    (2) If you are certifying the engine for use in vocational 
applications, you must measure CO2, CH4, and 
N2O emissions using the specified transient duty cycle, 
including cold-start and hot-start testing as specified in 40 CFR part 
86, subpart N.
    (3) You may certify your engine family for both tractor and 
vocational use by submitting CO2 emission data from both 
ramped-modal and transient cycle testing and specifying FCLs for both.
    (4) Some of your engines certified for use in tractors may also be 
used in vocational vehicles, and some of your engines certified for use 
in vocational may be used in tractors. However, you may not knowingly 
circumvent the intent of this part (to reduce in-use emissions of 
CO2) by certifying engines designed for tractors or 
vocational vehicles (and rarely used in the other application) to the 
wrong cycle. For example, we would generally not allow you to certify 
all your engines to the ramped-modal cycle without certifying any to 
the transient cycle.
    (c) We may perform confirmatory testing by measuring emissions from 
any of your emission-data engines. If your certification includes 
powertrain testing as specified in 40 CFR 1036.630, this paragraph (c) 
also applies for the powertrain test results.
    (1) We may decide to do the testing at your plant or any other 
facility. If we do this, you must deliver the engine to a test facility 
we designate. The engine you provide must include appropriate 
manifolds, aftertreatment devices, electronic control units, and other 
emission-related components not normally attached directly to the 
engine block. If we do the testing at your plant, you must schedule it 
as soon as possible and make available the instruments, personnel, and 
equipment we need.
    (2) If we measure emissions on your engine, the results of that 
testing become the official emission results for the engine as 
specified in this paragraph (c). Unless we later invalidate these data, 
we may decide not to consider your data in determining if your engine 
family meets applicable requirements.
    (3) Before we test one of your engines, we may set its adjustable 
parameters to any point within the physically adjustable ranges.
    (4) Before we test one of your engines, we may calibrate it within 
normal production tolerances for anything we do not consider an 
adjustable parameter. For example, this would apply for an engine 
parameter that is subject to production variability because it is 
adjustable during production, but is not considered an adjustable 
parameter (as defined in Sec.  1036.801) because it is permanently 
sealed. For parameters that relate to a level of performance that is 
itself subject to a specified range (such as maximum power output), we 
will generally perform any calibration under this paragraph (c)(4) in a 
way that keeps performance within the specified range.
    (5) We may use our emission test results for steady-state, idle, 
cycle-average and powertrain fuel maps, as long as we perform at least 
three valid tests. We will use mean values for each point to specify 
our fuel maps and may use the resulting fuel maps as the official 
emission results. We may also consider how the different fuel maps 
affect GEM emission results as part of our decision. We will not 
replace individual points from your fuel map, but we may make separate 
determinations for steady-state, idle, cycle-average and powertrain 
fuel maps.
    (6) If you supply cycle-average engine fuel maps for the highway 
cruise cycles instead of generating a steady-state fuel map for these 
cycles, we may perform a confirmatory test of your engine fuel maps for 
the highway cruise cycles by either of the following methods:
    (i) Directly measuring the highway cruise cycle-average fuel maps.
    (ii) Measuring a steady-state fuel map as described in paragraph 
(c)(5) of this section and using it in GEM to create our own cycle-
average engine fuel maps for the highway cruise cycles.
    (d) You may ask to use carryover emission data from a previous 
model year instead of doing new tests, but only if all the following 
are true:
    (1) The engine family from the previous model year differs from the 
current engine family only with respect to model year, items identified 
in Sec.  1036.225(a), or other characteristics unrelated to emissions. 
We may waive this criterion for differences we determine not to be 
relevant.
    (2) The emission-data engine from the previous model year remains 
the appropriate emission-data engine under paragraph (b) of this 
section.
    (3) The data show that the emission-data engine would meet all the 
requirements that apply to the engine family covered by the application 
for certification.
    (e) We may require you to test a second engine of the same 
configuration in addition to the engine tested under paragraph (a) of 
this section.
    (f) If you use an alternate test procedure under 40 CFR 1065.10 and 
later testing shows that such testing does not produce results that are 
equivalent to the procedures specified

[[Page 74020]]

in subpart F of this part, we may reject data you generated using the 
alternate procedure.


Sec.  1036.241  Demonstrating compliance with greenhouse gas emission 
standards.

    (a) For purposes of certification, your engine family is considered 
in compliance with the emission standards in Sec.  1036.108 if all 
emission-data engines representing the tested configuration of that 
engine family have test results showing official emission results and 
deteriorated emission levels at or below the standards. Note that your 
FCLs are considered to be the applicable emission standards with which 
you must comply for certification.
    (b) Your engine family is deemed not to comply if any emission-data 
engine representing the tested configuration of that engine family has 
test results showing an official emission result or a deteriorated 
emission level for any pollutant that is above an applicable emission 
standard (generally the FCL). Note that you may increase your FCL if 
any certification test results exceed your initial FCL.
    (c) Apply deterioration factors to the measured emission levels for 
each pollutant to show compliance with the applicable emission 
standards. Your deterioration factors must take into account any 
available data from in-use testing with similar engines. Apply 
deterioration factors as follows:
    (1) Additive deterioration factor for greenhouse gas emissions. 
Except as specified in paragraphs (c)(2) and (3) of this section, use 
an additive deterioration factor for exhaust emissions. An additive 
deterioration factor is the difference between the highest exhaust 
emissions (typically at the end of the useful life) and exhaust 
emissions at the low-hour test point. In these cases, adjust the 
official emission results for each tested engine at the selected test 
point by adding the factor to the measured emissions. If the factor is 
less than zero, use zero. Additive deterioration factors must be 
specified to one more decimal place than the applicable standard.
    (2) Multiplicative deterioration factor for greenhouse gas 
emissions. Use a multiplicative deterioration factor for a pollutant if 
good engineering judgment calls for the deterioration factor for that 
pollutant to be the ratio of the highest exhaust emissions (typically 
at the end of the useful life) to exhaust emissions at the low-hour 
test point. Adjust the official emission results for each tested engine 
at the selected test point by multiplying the measured emissions by the 
deterioration factor. If the factor is less than one, use one. A 
multiplicative deterioration factor may not be appropriate in cases 
where testing variability is significantly greater than engine-to-
engine variability. Multiplicative deterioration factors must be 
specified to one more significant figure than the applicable standard.
    (3) Sawtooth and other nonlinear deterioration patterns. The 
deterioration factors described in paragraphs (c)(1) and (2) of this 
section assume that the highest useful life emissions occur either at 
the end of useful life or at the low-hour test point. The provisions of 
this paragraph (c)(3) apply where good engineering judgment indicates 
that the highest useful life emissions will occur between these two 
points. For example, emissions may increase with service accumulation 
until a certain maintenance step is performed, then return to the low-
hour emission levels and begin increasing again. Such a pattern may 
occur with battery-based electric hybrid engines. Base deterioration 
factors for engines with such emission patterns on the difference 
between (or ratio of) the point at which the highest emissions occur 
and the low-hour test point. Note that this applies for maintenance-
related deterioration only where we allow such critical emission-
related maintenance.
    (4) [Reserved]
    (5) Dual-fuel and flexible-fuel engines. In the case of dual-fuel 
and flexible-fuel engines, apply deterioration factors separately for 
each fuel type by measuring emissions with each fuel type at each test 
point. You may accumulate service hours on a single emission-data 
engine using the type of fuel or the fuel mixture expected to have the 
highest combustion and exhaust temperatures; you may ask us to approve 
a different fuel mixture if you demonstrate that a different criterion 
is more appropriate.
    (d) Calculate emission data using measurements to at least one more 
decimal place than the applicable standard. Apply the deterioration 
factor to the official emission result, as described in paragraph (c) 
of this section, then round the adjusted figure to the same number of 
decimal places as the emission standard. Compare the rounded emission 
levels to the emission standard for each emission-data engine.
    (e) If you identify more than one configuration in Sec.  
1036.205(e), we may test (or require you to test) any of the identified 
configurations. We may also require you to provide an engineering 
analysis that demonstrates that untested configurations listed in Sec.  
1036.205(e) comply with their FCL.


Sec.  1036.250  Reporting and recordkeeping for certification.

    (a) Within 90 days after the end of the model year, send the 
Designated Compliance Officer a report including the total U.S.-
directed production volume of engines you produced in each engine 
family during the model year (based on information available at the 
time of the report). Report the production by serial number and engine 
configuration. Small manufacturers may omit this requirement. You may 
combine this report with reports required under subpart H of this part.
    (b) Organize and maintain the following records:
    (1) A copy of all applications and any summary information you send 
us.
    (2) Any of the information we specify in Sec.  1036.205 that you 
were not required to include in your application.
    (c) Keep routine data from emission tests required by this part 
(such as test cell temperatures and relative humidity readings) for one 
year after we issue the associated certificate of conformity. Keep all 
other information specified in this section for eight years after we 
issue your certificate.
    (d) Store these records in any format and on any media, as long as 
you can promptly send us organized, written records in English if we 
ask for them. You must keep these records readily available. We may 
review them at any time.


Sec.  1036.255  What decisions may EPA make regarding my certificate of 
conformity?

    (a) If we determine your application is complete and shows that the 
engine family meets all the requirements of this part and the Act, we 
will issue a certificate of conformity for your engine family for that 
model year. We may make the approval subject to additional conditions.
    (b) We may deny your application for certification if we determine 
that your engine family fails to comply with emission standards or 
other requirements of this part or the Clean Air Act. We will base our 
decision on all available information. If we deny your application, we 
will explain why in writing.
    (c) In addition, we may deny your application or suspend or revoke 
your certificate if you do any of the following:
    (1) Refuse to comply with any testing or reporting requirements.
    (2) Submit false or incomplete information (paragraph (e) of this 
section applies if this is fraudulent). This includes doing anything 
after submission of your application to

[[Page 74021]]

render any of the submitted information false or incomplete.
    (3) Render inaccurate any test data.
    (4) Deny us from completing authorized activities (see 40 CFR 
1068.20). This includes a failure to provide reasonable assistance.
    (5) Produce engines for importation into the United States at a 
location where local law prohibits us from carrying out authorized 
activities.
    (6) Fail to supply requested information or amend your application 
to include all engines being produced.
    (7) Take any action that otherwise circumvents the intent of the 
Act or this part, with respect to your engine family.
    (d) We may void the certificate of conformity for an engine family 
if you fail to keep records, send reports, or give us information as 
required under this part or the Act. Note that these are also 
violations of 40 CFR 1068.101(a)(2).
    (e) We may void your certificate if we find that you intentionally 
submitted false or incomplete information. This includes rendering 
submitted information false or incomplete after submission.
    (f) If we deny your application or suspend, revoke, or void your 
certificate, you may ask for a hearing (see Sec.  1036.820).

Subpart D--Testing Production Engines


Sec.  1036.301  Measurements related to GEM inputs in a selective 
enforcement audit.

    (a) Selective enforcement audits apply for engines as specified in 
40 CFR part 1068, subpart E. This section describes how this applies 
uniquely in certain circumstances.
    (b) Selective enforcement audit provisions apply with respect to 
your fuel maps as follows:
    (1) A selective enforcement audit for an engine with respect to 
fuel maps would consist of performing measurements with production 
engines to determine fuel-consumption rates as declared for GEM 
simulations, and running GEM for the vehicle configurations specified 
in paragraph (b)(2) of this section based on those measured values. The 
engine is considered passing for a given configuration if the new 
modeled emission result for each applicable duty cycle is at or below 
the modeled emission result corresponding to the declared GEM inputs. 
The engine is considered failing for a given configuration if the new 
modeled emission result for any applicable duty cycle is above the 
modeled emission result corresponding to the declared GEM inputs.
    (2) Evaluate cycle-average fuel maps by running GEM based on 
simulated vehicle configurations representing the interpolated center 
of every group of four test points that define a boundary of cycle work 
and average engine speed divided by average vehicle speed. These 
simulated vehicle configurations are defined from the four surrounding 
points based on averaging values for vehicle mass, drag area (if 
applicable), tire rolling resistance, tire size, and axle ratio. The 
regulatory subcategory is defined by the regulatory subcategory of the 
vehicle configuration with the greatest mass from those four test 
points. Figure 1 of this section illustrates a determination of vehicle 
configurations for engines used in tractors and Vocational HDV using a 
fixed tire size (see Sec.  1036.540(c)(3)(iii)). The vehicle 
configuration from the upper-left quadrant is defined by values for 
Tests 1, 2, 4, and 5 from Table 3 of Sec.  1036.540. Calculate vehicle 
mass as the average of the values from the four tests. Determine the 
weight reduction needed for GEM to simulate this calculated vehicle 
mass by comparing the average vehicle mass to the default vehicle mass 
for the vehicle subcategory from the four points that has the greatest 
mass, with the understanding that two-thirds of weight reduction for 
tractors is applied to vehicle weight and one-third is understood to 
represent increased payload. This is expressed mathematically as 
Mavg = Msubcategory - \2/3\ [middot] 
Mreduction, which can be solved for Mreduction. 
For vocational vehicles, half of weight reduction is applied to vehicle 
weight and half is understood to represent increased payload. Use the 
following values for default vehicle masses by vehicle subcategory:

 Table 1 of Sec.   1036.301--Default Vehicle Mass by Vehicle Subcategory
------------------------------------------------------------------------
                                                              Default
                   Vehicle subcategory                     vehicle mass
                                                               (kg)
------------------------------------------------------------------------
Vocational Light HDV....................................           7,257
Vocational Medium HDV...................................          11,408
Class 7 Mid-Roof Day Cab................................          20,910
Class 8 Mid-Roof Day Cab................................          29,529
Class 8 High-Roof Sleeper Cab...........................          31,978
Heavy-Haul Tractor......................................          53,750
------------------------------------------------------------------------

    (3) This paragraph (b)(3) provides an example to illustrate how to 
determine GEM input values for the four vehicle configurations 
identified in paragraph (b)(2) of this section. If axle ratio is 2.5 
for Tests 1 and 2, and 3.5 for Tests 4 and 5, the average value is 3.0. 
A tire size of 500 revolutions per mile would apply for all four tests, 
so the average tire size would be that same value. Similarly, 
Crr is 6.9 kg/tonne since that value applies for all four 
points. The calculated average value of CdA is 6.9 m\2\. The 
calculated average vehicle mass is 28,746.5 kg. Weight reduction is 
4,847 kg or 10,686 pounds (\3/2\ [middot] (31,978 - 28,746.5)).
    (4) Because your cycle-average map may have more or fewer test 
points, you may have more than or fewer than the number of audit points 
shown in Figure 1 of this section. If the audit includes fuel-map 
testing in conjunction with engine testing relative to exhaust emission 
standards, the fuel-map simulations for the whole set of vehicles and 
duty cycles counts as a single test result for purposes of evaluating 
whether the engine family meets the pass-fail criteria under 40 CFR 
1068.420. If the audit includes only fuel-map testing, determine 
emission results from at least three different engine configurations 
simulated with each applicable vehicle configuration identified in 
Sec.  1036.540; the fuel-map simulation for each vehicle configuration 
counts as a separate test for the engine.

[[Page 74022]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.048

    (c) If your certification includes powertrain testing as specified 
in 40 CFR 1036.630, these selective enforcement audit provisions apply 
with respect to powertrain test results as specified in 40 CFR part 
1037, subpart D, and 40 CFR 1037.550. We may allow manufacturers to 
instead perform the engine-based testing to simulate the powertrain 
test as specified in 40 CFR 1037.551.
    (d) We may suspend or revoke certificates for any appropriate 
configurations within one or more engine families based on the outcome 
of a selective enforcement audit.

Subpart E--In-Use Testing


Sec.  1036.401  In-use testing.

    We may perform in-use testing of any engine family subject to the 
standards of this part, consistent with the Clean Air Act and the 
provisions of Sec.  1036.235. Note that this provision does not affect 
your obligation to test your in-use engines as described in 40 CFR part 
86, subpart T.

Subpart F--Test Procedures


Sec.  1036.501  How do I run a valid emission test?

    (a) Use the equipment and procedures specified in this subpart and 
40 CFR 86.1305 to determine whether engines meet the emission standards 
in Sec.  1036.108.
    (b) You may use special or alternate procedures to the extent we 
allow them under 40 CFR 1065.10.
    (c) This subpart is addressed to you as a manufacturer, but it 
applies equally to anyone who does testing for you, and to us when we 
perform testing to determine if your engines meet emission standards.
    (d) For engines that use aftertreatment technology with infrequent 
regeneration events, apply infrequent regeneration adjustment factors 
as described in Sec.  1036.530.
    (e) Test hybrid engines as described in Sec.  1036.525 and 40 CFR 
part 1065.
    (f) Determine engine fuel maps as described in Sec.  1036.510(b).
    (g) The following additional provisions apply for testing to 
demonstrate compliance with the emission standards in Sec.  1036.108 
for model year 2021 and later engines:
    (1) If your engine is intended for installation in a vehicle 
equipped with stop-start technology, you may use good engineering 
judgment to turn the engine off during the idle portions of the duty 
cycle to represent in-use operation, consistent with good engineering 
judgment.
    (2) Use one of the following methods to measure CO2 
emissions:
    (i) Use the ramped-modal cycle specified in Sec.  1036.505 using 
either continuous or batch sampling.
    (ii) Measure CO2 emissions over the ramped-modal cycle 
specified in 40 CFR 86.1362 using continuous sampling. Integrate the 
test results by mode to establish separate emission rates for each mode 
(including the transition following each mode, as applicable). Apply 
the weighting factors specified in 40 CFR 86.1362 to calculate a 
composite emission result.
    (3) Measure or calculate emissions of criteria pollutants 
corresponding to your measurements to demonstrate compliance with 
CO2 standards. These test results are not subject to the 
duty-cycle standards of 40 CFR part 86, subart A.


Sec.  1036.505  Ramped-modal testing procedures.

    (a) Starting in model year 2021, you must measure CO2 
emissions using the ramped-modal cycle in 40 CFR 86.1362 as described 
in Sec.  1036.501, or using the ramped-modal cycle in this section.
    (b) Measure emissions using the ramped-modal duty cycle shown in 
the following table to determine whether engines meet the steady-state 
compression-ignition standards specified in subpart B of this part:

[[Page 74023]]



                               Table 1 of Sec.   1036.505--Ramped-Modal Duty Cycle
----------------------------------------------------------------------------------------------------------------
                                           Time in mode
                RMC mode                     (seconds)       Engine speed \1\ \2\      Torque (percent) \2\ \3\
----------------------------------------------------------------------------------------------------------------
1a Steady-state.........................             124  Warm Idle.................  0.
1b Transition...........................              20  Linear Transition.........  Linear Transition.
2a Steady-state.........................             196  A.........................  100.
2b Transition...........................              20  Linear Transition.........  Linear Transition.
3a Steady-state.........................             220  B.........................  50.
3b Transition...........................              20  B.........................  Linear Transition.
4a Steady-state.........................             220  B.........................  75.
4b Transition...........................              20  Linear Transition.........  Linear Transition.
5a Steady-state.........................             268  A.........................  50.
5b Transition...........................              20  A.........................  Linear Transition.
6a Steady-state.........................             268  A.........................  75.
6b Transition...........................              20  A.........................  Linear Transition.
7a Steady-state.........................             268  A.........................  25.
7b Transition...........................              20  Linear Transition.........  Linear Transition.
8a Steady-state.........................             196  B.........................  100.
8b Transition...........................              20  B.........................  Linear Transition.
9a Steady-state.........................             196  B.........................  25.
9b Transition...........................              20  Linear Transition.........  Linear Transition.
10a Steady-state........................              28  C.........................  100.
10b Transition..........................              20  C.........................  Linear Transition.
11a Steady-state........................               4  C.........................  25.
11b Transition..........................              20  C.........................  Linear Transition.
12a Steady-state........................               4  C.........................  75.
12b Transition..........................              20  C.........................  Linear Transition.
13a Steady-state........................               4  C.........................  50.
13b Transition..........................              20  Linear Transition.........  Linear Transition.
14 Steady-state.........................             144  Warm Idle.................  0.
----------------------------------------------------------------------------------------------------------------
\1\ Speed terms are defined in 40 CFR part 1065.
\2\ Advance from one mode to the next within a 20 second transition phase. During the transition phase, command
  a linear progression from the speed or torque setting of the current mode to the speed or torque setting of
  the next mode.
\3\ The percent torque is relative to maximum torque at the commanded engine speed.

Sec.  1036.510  Engine data and information for vehicle certification.

    You must give vehicle manufacturers information as follows so they 
can certify model year 2021 and later vehicles:
    (a) Identify engine make, model, fuel type, engine family name, 
calibration identification, and engine displacement. Also identify 
which standards the engines meet.
    (b) This paragraph (b) describes three different methods to 
generate engine fuel maps. Manufacturers may generally rely on any of 
the three mapping methods. However, manufacturers must generate fuel 
maps using either cycle-average or powertrain testing as described in 
paragraphs (b)(2) and (3) of this section for hybrid engines and hybrid 
vehicles. Also, vehicle manufacturers must use the powertrain method 
for any vehicle with a transmission that is not automatic, automated 
manual, manual, or dual-clutch.
    (1) Combined steady-state and cycle-average. Determine steady-state 
engine fuel maps and fuel consumption at idle as described in Sec.  
1036.535, and determine cycle-average engine fuel maps as described in 
Sec.  1036.540, excluding cycle-average fuel maps for highway cruise 
cycles.
    (2) Cycle-average. Determine fuel consumption at idle as described 
in Sec.  1036.535, and determine cycle-average engine fuel maps as 
described in Sec.  1036.540, including cycle-average engine fuel maps 
for highway cruise cycles. In this case, you do not need to determine 
steady-state engine fuel maps under Sec.  1036.535. Fuel mapping for 
highway cruise cycles using cycle-average testing is an alternate 
method, which means that we may do confirmatory testing based on 
steady-state fuel mapping for highway cruise cycles even if you do not; 
however, we will use the steady-state fuel maps to create cycle-average 
fuel maps. In Sec.  1036.540 we define the vehicle configurations for 
testing; we may add more vehicle configurations to better represent 
your engine's operation for the range of vehicles in which your engines 
will be installed (see 40 1065.10(c)(1)).
    (3) Powertrain. Generate a powertrain fuel map as described in 40 
CFR 1037.550. In this case, you do not need to perform fuel mapping 
under Sec.  1036.535 or Sec.  1036.540.
    (d) Provide the following information if you generate engine fuel 
maps using either paragraph (b)(1) or (2) of this section:
    (1) Full-load torque curve for installed engines, and the full-load 
torque curve of the engine with the highest fueling rate that shares 
the same engine hardware, including the turbocharger, as described in 
40 CFR 1065.510. You may use 40 CFR 1065.510(b)(5)(i) for engines 
subject to spark-ignition standards. Measure the torque curve for 
hybrid engines as described in 40 CFR 1065.510(g) with the hybrid 
system active.
    (2) Motoring torque map as described in 40 CFR 1065.510(c)(2) and 
(4) for conventional and hybrid engines, respectively.
    (3) Declared engine idle speed. For vehicles with manual 
transmissions, this is the engine speed with the transmission in 
neutral. For all other vehicles, this is the engine's idle speed when 
the transmission is in drive.


Sec.  1036.525  Hybrid engines.

    (a) If your engine system includes features that recover and store 
energy during engine motoring operation, test the engine as described 
in paragraph (d) of this section. For purposes of this section, 
features that recover energy between the engine and transmission are 
considered related to engine motoring.
    (b) If you produce a hybrid engine designed with power take-off 
capability and sell the engine coupled with a

[[Page 74024]]

transmission, you may calculate a reduction in CO2 emissions 
resulting from the power take-off operation as described in 40 CFR 
1037.540. Quantify the CO2 reduction for your engines using 
the vehicle-based procedures, consistent with good engineering 
judgment.
    (c) For engines that include electric hybrid systems, test the 
engine with the hybrid electric motor, the rechargeable energy storage 
system (RESS), and the power electronics between the hybrid electric 
motor and the RESS. You may ask us to modify the provisions of this 
section for testing engines with other kinds of hybrid systems.
    (d) Measure emissions using the same procedures that apply for 
testing non-hybrid engines under this part, except as specified in this 
part and 40 CFR part 1065. For ramped-modal testing, deactivate the 
hybrid features unless we specify otherwise. The following provisions 
apply for testing hybrid engines:
    (1) Engine mapping. Map the engine as specified in 40 CFR 1065.510. 
This requires separate torque maps for the engine with and without the 
hybrid features active. For transient testing, denormalize the duty 
cycle using the map generated with the hybrid feature active. For 
steady-state testing, denormalize the duty cycle using the map 
generated without the hybrid feature.
    (2) Engine shutdown during testing. If you will configure 
production engines to shut down automatically during idle operation, 
you may let the engine shut down during the idle portions of the duty 
cycle.
    (3) Work calculation. Calculate positive and negative work done 
over the cycle according to 40 CFR 1065.650(d), except that you must 
set power to zero to calculate negative work done for any period over 
the cycle where the engine produces net positive power or where the 
negative power is solely from the engine and not the hybrid system.
    (4) Limits on braking energy. Calculate brake energy fraction, 
xb, as follows:
    (i) Calculate xb as the integrated negative work over 
the cycle divided by the integrated positive work over the cycle 
according to Eq. 1036.525-1. Calculate the brake energy limit for the 
engine, xbl, according to Eq. 1036.525-2. If xb 
is less than or equal to xbl, use the integrated positive 
work for your emission calculations. If xb is greater than 
xbl use Eq. 1036.525-3 to calculate an adjusted value for 
cycle work, Wcycle, and use Wcycle as the work 
value for calculating emission results. You may set an instantaneous 
brake target that will prevent xb from being larger than 
xbl to avoid the need to subtract extra brake work from 
positive work.
[GRAPHIC] [TIFF OMITTED] TR25OC16.049

Where:

Wneg = the negative work over the cycle.
Wpos = the positive work over the cycle.
[GRAPHIC] [TIFF OMITTED] TR25OC16.050

Where:

Pmax = the maximum power of the engine with the hybrid 
system engaged.
[GRAPHIC] [TIFF OMITTED] TR25OC16.051

Where:

Wcycle = cycle work when xb is greater than 
xbl.

    Example: 
Wneg = 4.69 kW-hr
Wpos = 14.67 kW-hr
Pmax = 223 kW
[GRAPHIC] [TIFF OMITTED] TR25OC16.052

xbl = 4.158.10-4[middot].223 + 0.2247 = 0.317 
kW
since xb > xbl;;
Wcycle = 14.67 - ([bond]4.59[bond] - 0.317[middot]14.67) 
= 14.63 kW-hr

    (ii) Convert from g/kW-hr to g/hp-hr as the final step in 
calculating emission results.
    (5) State of charge. Correct for the net energy change of the 
energy storage device as described in 40 CFR 1066.501.


Sec.  1036.530  Calculating greenhouse gas emission rates.

    This section describes how to calculate official emission results 
for CO2, CH4, and N2O.
    (a) Calculate brake-specific emission rates for each applicable 
duty cycle as specified in 40 CFR 1065.650. Apply infrequent 
regeneration adjustment factors to your cycle-average results as 
described in 40 CFR 86.004-28 for CO2 starting in model year 
2021. You may optionally apply infrequent regeneration adjustment 
factors for CH4 and N2O.
    (b) Adjust CO2 emission rates calculated under paragraph 
(a) of this section for measured test fuel properties as specified in 
this paragraph (b). This adjustment is intended to make official 
emission results independent of differences in test fuels within a fuel 
type. Use good engineering judgment to develop and apply testing 
protocols to minimize the impact of variations in test fuels.
    (1) Determine mass-specific net energy content, 
Emfuelmeas, also known as lower heating value, in MJ/kg, 
expressed to at least three decimal places, as follows:
    (i) For liquid fuels, determine Emfuelmeas according to 
ASTM D4809 (incorporated by reference in Sec.  1036.810).
    (ii) For gaseous fuels, determine Emfuelmeas using good 
engineering judgment.
    (2) Determine your test fuel's carbon mass fraction, wC, 
as described in 40 CFR 1065.655(d), expressed to at least three decimal 
places; however, you must measure fuel properties rather than using the 
default values specified in Table 1 of 40 CFR 1065.655. Have the sample 
analyzed by three different labs and use the arithmetic mean of the 
results as your test fuel's wC.
    (3) If, over a period of time, you receive multiple fuel deliveries 
from a single stock batch of test fuel, you may use constant values for 
mass-specific energy content and carbon mass fraction, consistent with 
good engineering judgment. To use this provision, you must demonstrate 
that every subsequent delivery comes from the same stock batch and that 
the fuel has not been contaminated.
    (4) Correct measured CO2 emission rates as follows:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.053
    
Where:

eCO2 = the calculated CO2 emission result.
Emfuelmeas = the mass-specific net energy content of the 
test fuel as determined in paragraph (b)(1) of this section. Note 
that dividing this value by wCmeas (as is done in this 
equation) equates to a carbon-specific net energy content having the 
same units as EmfuelCref.
EmfuelCref = the reference value of carbon-mass-specific 
net energy content for the appropriate fuel type, as determined in 
Table 1 of this section.
wCmeas = carbon mass fraction of the test fuel (or 
mixture of test fuels) as determined in paragraph (b)(2) of this 
section.

    Example: 
eCO2 = 630.0 g/hp[middot]hr
Emfuelmeas = 42.528 MJ/kg
EmfuelCref = 49.3112 MJ/kgC
wCmeas = 0.870

[[Page 74025]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.054

eCO2cor = 624.5 g/hp[middot]hr

          Table 1 of Sec.   1036.530--Reference fuel properties
------------------------------------------------------------------------
                                       Reference fuel
                                        carbon-mass-     Reference fuel
                                        specific net       carbon mass
            Fuel type\1\               energy content,   fraction, wCref
                                      EmfuelCref,  (MJ/        \2\
                                          kgC) \2\
------------------------------------------------------------------------
Diesel fuel.........................           49.3112             0.874
Gasoline............................           50.4742             0.846
Natural Gas.........................           66.2910             0.750
LPG.................................           56.5218             0.820
Dimethyl Ether......................           55.3886             0.521
High-level ethanol-gasoline blends..           50.3211             0.576
------------------------------------------------------------------------
\1\ For fuels that are not listed, you must ask us to approve reference
  fuel properties.
\2\ For multi-fuel streams, such as natural gas with diesel fuel pilot
  injection, use good engineering judgment to determine blended values
  for EmfuelCref and wCref using the values in this table.

    (c) Your official emission result for each pollutant equals your 
calculated brake-specific emission rate multiplied by all applicable 
adjustment factors, other than the deterioration factor.


Sec.  1036.535  Determining steady-state engine fuel maps and fuel 
consumption at idle.

    This section describes how to determine an engine's steady-state 
fuel map and fuel consumption at idle for model year 2021 and later 
vehicles. Vehicle manufacturers may need these values to demonstrate 
compliance with emission standards under 40 CFR part 1037 as described 
in Sec.  1036.510.
    (a) General test provisions. Perform fuel mapping using the 
procedure described in paragraph (b) of this section to establish 
measured fuel-consumption rates at a range of engine speed and load 
settings. Measure fuel consumption at idle using the procedure 
described in paragraph (c) of this section. If you perform cycle-
average mapping for highway cruise cycles as described in Sec.  
1037.540, omit mapping under paragraph (b) of the section and instead 
perform mapping as described in paragraph (c) and (d) of this section. 
Use these measured fuel-consumption values to declare fuel-consumption 
rates for certification as described in paragraph (e) of this section.
    (1) Map the engine as described in Sec.  1036.510(a)(2) and (3), 
and perform emission measurements as described in 40 CFR 1065.501 and 
1065.530 for discrete-mode steady-state testing. This section uses 
engine parameters and variables that are consistent with 40 CFR part 
1065.
    (2) Measure NOX emissions for each specified sampling 
period in g/s. You may perform these measurements using a 
NOX emission-measurement system that meets the requirements 
of 40 CFR part 1065, subpart J. Include these measured NOX 
values any time you report to us your fuel consumption values from 
testing under this section. If a system malfunction prevents you from 
measuring NOX emissions during a test under this section but 
the test otherwise gives valid results, you may consider this a valid 
test and omit the NOX emission measurements; however, we may 
require you to repeat the test if we determine that you inappropriately 
voided the test with respect to NOX emission measurement.
    (b) Steady-state fuel mapping. Determine fuel-consumption rates for 
each engine configuration over a series of steady-state engine 
operating points as described in this paragraph (b). You may use shared 
data across an engine platform to the extent that the fuel-consumption 
rates remain valid. For example, if you test a high-output 
configuration and create a different configuration that uses the same 
fueling strategy but limits the engine operation to be a subset of that 
from the high-output configuration, you may use the fuel-consumption 
rates for the reduced number of mapped points for the low-output 
configuration, as long as the narrower map includes at least 70 points. 
Perform fuel mapping as follows:
    (1) Select ten speed points that include warm idle speed, 
fnidle, the highest speed above maximum power at which 70% 
of maximum power occurs, nhi, and eight equally spaced 
points between fnidle and nhi. Control speed to 
within 1% of nhi (see 40 CFR 1065.610(c)).
    (2) Select ten torque values, including T = 0, maximum mapped 
torque, Tmax mapped, and eight equally spaced points between 
T = 0 and Tmax mapped. Replace any torque setpoints that are 
above the mapped torque at a given speed, Tmax, minus 5 
percent of Tmax mapped. with one test point at 
Tmax. Control engine torque to within 5% of 
Tmax mapped.
    (3) You may need to adjust dynamometer settings any time the engine 
is operating on the low-speed or high-speed governor to maintain stable 
engine operation. You may change the dynamometer's speed setpoint as 
needed to avoid activating the engine's governor. You may alternatively 
set the dynamometer mode to torque-control, in which case speed can 
fall outside of 1% of nhi.
    (4) Precondition the engine as described in 40 CFR 1065.510(b)(2).
    (5) Within 60 seconds after concluding the preconditioning 
procedure, operate the engine at nhi and Tmax.
    (6) After the engine operates at the set speed and torque for 60 
seconds, start recording measurements using one of the following 
methods:
    (i) Carbon mass balance. Record speed and torque and measure 
emissions and other inputs needed to run the chemical balance in 40 CFR 
1065.655(c) for (29 to 31) seconds; determine the corresponding mean 
values for the sampling period. We will use carbon mass balance.
    (ii) Direct measurement of fuel flow. Record speed and torque and 
measure fuel consumption with a fuel flow meter for (29 to 31) seconds; 
determine the corresponding mean values for the sampling period.
    (7) After completing the sampling period described in paragraph 
(b)(6) of this section, linearly ramp the engine over 15 seconds to the 
next lowest torque value while holding speed constant. Perform the 
measurements described at the new torque setting and

[[Page 74026]]

repeat this sequence for all remaining torque values down to T = 0.
    (8) Continue testing to complete fuel mapping as follows:
    (i) At T = 0, linearly ramp the engine over 15 seconds to operate 
at the next lowest speed value and increase torque to Tmax. 
Perform measurements for all the torque values at the selected speed as 
described in paragraphs (b)(6) and (7) of this section. Repeat this 
sequence for all remaining speed values down to fnidle to 
complete the fuel-mapping procedure. You may interrupt the mapping 
sequence to calibrate emission-measurement instrumentation only during 
stabilization at Tmax for a given speed. If you use batch 
sampling to measure background emissions, you may sample periodically 
into the bag over the course of multiple test intervals defined by the 
period between calibrations of emission-measurement instrumentation. 
The background sample must be applied to correct emissions sampled over 
the test interval(s) between calibrations.
    (ii) If an infrequent regeneration event occurs during fuel 
mapping, invalidate all the measurements made at that engine speed. 
Allow the regeneration event to finish, then restart engine 
stabilization at Tmax at the same engine speed and continue 
with measurements from that point in the fuel-mapping sequence.
    (9) If you determine fuel-consumption rates using emission 
measurements from the raw or diluted exhaust, calculate the mean fuel 
mass flow rate, mifuel, for each point in the fuel map using 
the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.055

Where:

mifuel = mean fuel mass flow rate for a given fuel map 
setpoint, expressed to at least the nearest 0.001 g/s.
MC = molar mass of carbon.
wCmeas = carbon mass fraction of fuel (or mixture of test 
fuels) as determined in 40 CFR 1065.655(d), except that you may not 
use the default properties in Table 1 of 40 CFR 1065.655 to 
determine [alpha], [beta], and wC for liquid fuels.
niexh= the mean raw exhaust molar flow rate from which 
you measured emissions according to 40 CFR 1065.655.
xCcombdry= the mean concentration of carbon from fuel and 
any injected fluids in the exhaust per mole of dry exhaust as 
determined in 40 CFR 1065.655(c).
xH2Oexhdry= the mean concentration of H2O in 
exhaust per mole of dry exhaust as determined in 40 CFR 1065.655(c).
miCO2DEF= the mean CO2 mass emission rate 
resulting from diesel exhaust fluid decomposition as determined in 
paragraph (b)(10) of this section. If your engine does not use 
diesel exhaust fluid, or if you choose not to perform this 
correction, set miCO2DEF equal to 0.
MCO2 = molar mass of carbon dioxide.

    Example: 
MC = 12.0107 g/mol
wCmeas = 0.869
niexh= 25.534 mol/s
xCcombdry= 0.002805 mol/mol
xH2Oexhdry= 0.0353 mol/mol
miCO2DEF= 0.0726 g/s
MCO2 = 44.0095 g/mol
[GRAPHIC] [TIFF OMITTED] TR25OC16.056

    (10) If you determine fuel-consumption rates using emission 
measurements with engines that utilize diesel exhaust fluid for 
NOX control, correct for the mean CO2 mass 
emissions resulting from diesel exhaust fluid decomposition at each 
fuel map setpoint using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.057

Where:

miDEF= the mean mass flow rate of injected urea solution 
diesel exhaust fluid for a given sampling period, determined 
directly from the engine control module, or measured separately, 
consistent with good engineering judgment.
MCO2 = molar mass of carbon dioxide.
wCH4N2O = mass fraction of urea in diesel exhaust fluid 
aqueous solution. Note that the subscript ``CH4N2O'' refers to urea 
as a pure compound and the subscript ``DEF'' refers to the aqueous 
32.5% urea diesel exhaust fluid as a solution of urea in water with 
a nominal urea concentration of 32.5%.
MCH4N2O = molar mass of urea.

    Example: 
miDEF= 0. 304 g/s
MCO2 = 44.0095 g/mol
wCH4N2O = 32.5% = 0.325
MCH4N2O = 60.05526 g/mol
[GRAPHIC] [TIFF OMITTED] TR25OC16.058


[[Page 74027]]


    (11) Correct the measured or calculated mean fuel mass flow rate, 
mifuel at each engine operating condition to a mass-specific 
net energy content of a reference fuel using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.059

Where:

Emfuelmeas = the mass-specific net energy content of the 
test fuel as determined in Sec.  1036.530(b)(1).
EmfuelCref = the reference value of carbon-mass-specific 
net energy content for the appropriate fuel. Use the values shown in 
Table 1 of Sec.  1036.530 for the designated fuel types, or values 
we approve for other fuel types.
wCref = the reference value of carbon mass fraction for 
the test fuel as shown in Table 1 of Sec.  1036.530 for the 
designated fuels. For other fuels, use the reference carbon mass 
fraction of diesel fuel for engines subject to compression-ignition 
standards, and use the reference carbon mass fraction of gasoline 
for engines subject to spark-ignition standards.

    Example: 
mifuel= 0.933 g/s
Emfuelmeas = 42.7984 MJ/kgC
EmfuelCref = 49.3112 MJ/kgC
wCref = 0.874
[GRAPHIC] [TIFF OMITTED] TR25OC16.060

    (c) Fuel consumption at idle. Determine values for fuel-consumption 
rate at idle for each engine configuration as described in this 
paragraph (c). You may use shared data across engine configurations, 
consistent with good engineering judgment. Perform measurements as 
follows:
    (1) Precondition the engine as described in 40 CFR 1065.510(b)(2).
    (2) Within 60 seconds after concluding the preconditioning 
procedure, operate the engine at its minimum declared warm idle speed, 
fnidlemin, as described in 40 CFR 1065.510(b)(3), set zero 
torque, and start the sampling period. Continue sampling for (595 to 
605) seconds. Perform measurements using carbon mass balance. Record 
speed and torque and measure emissions and other inputs as described in 
40 CFR 1065.655(c); determine the corresponding mean values for the 
sampling period. Calculate the mean fuel mass flow rate, 
mifuel, during the sampling period as described in paragraph 
(b)(9) of this section.
    Manufacturers may instead measure fuel consumption with a fuel flow 
meter and determine the corresponding mean values for the sampling 
period.
    (3) Repeat the steps in paragraphs (c)(1) and (2) of this section 
with the engine set to operate at a torque setting of 100 N[middot]m.
    (4) Repeat the steps in paragraphs (c)(1) through (3) of this 
section with the engine operated at its declared maximum warm idle 
speed, fnidlemax.
    (5) If an infrequent regeneration event occurs during this 
procedure, invalidate any measurements made at that idle condition. 
Allow the regeneration event to finish, then repeat the measurement and 
continue with the test sequence.
    (6) Correct the measured or calculated mean fuel mass flow rate, 
mifuel at each of the four idle settings to account for 
mass-specific net energy content as described in paragraph (b)(11) of 
this section.
    (d) Steady-state fuel maps used for cycle-average fuel mapping of 
the cruise cycles. Use the appropriate default steady-state engine fuel 
map as specified in Appendix I to this part to generate cycle-average 
fuel maps under Sec.  1036.540, as amended based on the measurements 
specified in this paragraph (d). Measure fuel consumption at idle at 
the four specified engine operating conditions. For any values from the 
default map that lie within the boundaries of the engine speed and 
torque values represented by these idle-operating points, use the 
measured values instead of the default values. You may use shared data 
across engine configurations, consistent with good engineering 
judgment. Determine values for fuel-consumption rate at idle for each 
engine configuration as follows:
    (1) Determine idle torque, Tidle, at the engine's 
maximum warm idle speed using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.061

Where:

Tfnstall = the maximum engine torque at 
fnstall.
fnidle[speed] = the applicable engine idle speed as 
described in this paragraph (d).
fnstall = the stall speed of the torque converter; use 
fntest or 2250 rpm, whichever is lower.
    Pacc = accessory power for the vehicle class; use 
1500 W for Vocational Light HDV, 2500 W for Vocational Medium HDV, 
and 3500 W for Tractors and Vocational Heavy HDV.

    Example: 
Tfnstall = 1870 N[middot]m
fntest = 1740.8 r/min = 182.30 rad/s
fnstall = 1740.8 r/min = 182.30 rad/s
fnidlemax = 700 r/min = 73.30 rad/s
Pacc = 1500 W

[[Page 74028]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.062

    (2) Precondition the engine as described in 40 CFR 1065.510(b)(2).
    (3) Within 60 seconds after concluding the preconditioning 
procedure, operate the engine at its maximum declared warm idle speed, 
fnidlemax, as described in 40 CFR 1065.510(b)(3), set torque 
to the value determined in paragraph (d)(1) of this section, after the 
engine operates at the set speed and torque for 60 seconds, start the 
sampling period. Continue sampling for (29 to 31) seconds. Perform 
measurements using carbon mass balance. Record speed and torque and 
measure emissions and other inputs as described in 40 CFR 1065.655(c); 
determine the corresponding mean values for the sampling period. 
Calculate the mean fuel mass flow rate, mifuel, during the 
sampling period as described in paragraph (b)(9) of this section. 
Manufacturers may instead measure fuel consumption with a fuel flow 
meter and determine the corresponding mean values for the sampling 
period.
    (4) Repeat the steps in paragraphs (d)(2) and (3) of this section 
with the engine set to operate at zero torque.
    (5) Repeat the steps in paragraphs (d)(1) through (4) of this 
section with the engine operated at its declared minimum warm idle 
speed, fnidlemin.
    (6) If an infrequent regeneration event occurs during this 
procedure, invalidate any measurements made at that idle condition. 
Allow the regeneration event to finish, then repeat the measurement and 
continue with the test sequence.
    (7) Correct the measured or calculated mean fuel mass flow rate, 
mifuel at each of the four idle settings to account for 
mass-specific net energy content as described in paragraph (b)(11) of 
this section.
    (e) Measured vs. declared fuel-consumption rates. Select fuel-
consumption rates in g/s to characterize the engine's fuel maps. These 
declared values may not be lower than any corresponding measured values 
determined in paragraphs (b) through (d) of this section. You may 
select any value that is at or above the corresponding measured value. 
These declared fuel-consumption rates, which serve as emission 
standards under Sec.  1036.108, are the values that vehicle 
manufacturers will use for certification under 40 CFR part 1037. Note 
that production engines are subject to GEM cycle-weighted limits as 
described in Sec.  1036.301.


Sec.  1036.540  Determining cycle-average engine fuel maps.

    (a) Overview. This section describes how to determine an engine's 
cycle-average fuel maps for model year 2021 and later vehicles with 
transient cycles. This may also apply for highway cruise cycles as 
described in Sec.  1036.510. Vehicle manufacturers may need one or both 
of these to demonstrate compliance with emission standards under 40 CFR 
part 1037. Generating cycle-average engine fuel maps consists of the 
following steps:
    (1) Determine the engine's torque maps as described in Sec.  
1036.510(a).
    (2) Determine the engine's steady-state fuel map and fuel 
consumption at idle as described in Sec.  1036.535.
    (3) Simulate several different vehicle configurations using GEM 
(see 40 CFR 1037.520) to create new engine duty cycles, as described in 
paragraph (c) of this section. The transient vehicle duty cycles for 
this simulation are in 40 CFR part 1037, Appendix I; the highway cruise 
cycles with grade are in 40 CFR part 1037, Appendix IV. Note that GEM 
simulation relies on vehicle service classes as described in 40 CFR 
1037.140.
    (4) Test the engines using the new duty cycles to determine fuel 
consumption, cycle work, and average vehicle speed as described in 
paragraph (d) of this section and establish GEM inputs for those 
parameters for further vehicle simulations as described in paragraph 
(e) of this section.
    (b) General test provisions. The following provisions apply for 
testing under this section:
    (1) To perform fuel mapping under this section for hybrid engines, 
make sure the engine and its hybrid features are appropriately 
configured to represent the hybrid features in your testing.
    (2) Measure NOX emissions for each specified sampling 
period in grams. You may perform these measurements using a 
NOX emission-measurement system that meets the requirements 
of 40 CFR part 1065, subpart J. Include these measured NOX 
values any time you report to us your fuel consumption values from 
testing under this section. If a system malfunction prevents you from 
measuring NOX emissions during a test under this section but 
the test otherwise gives valid results, you may consider this a valid 
test and omit the NOX emission measurements; however, we may 
require you to repeat the test if we determine that you inappropriately 
voided the test with respect to NOX emission measurement.
    (3) This section uses engine parameters and variables that are 
consistent with 40 CFR part 1065.
    (c) Create engine cycles. Use GEM to simulate several different 
vehicle configurations to create transient and highway cruise engine 
cycles corresponding to each vehicle configuration, as follows:
    (1) Set up GEM to simulate vehicle operation based on your engine's 
torque maps, steady-state fuel maps, and fuel consumption at idle as 
described in paragraph (a)(1) and (2) of this section.
    (2) Set up GEM with transmission gear ratios for different vehicle 
service classes and vehicle duty cycles as described in Table 1 of this 
section. These values are based on automatic or automated manual 
transmissions, but they apply for all transmission types.

                          Table 1 of Sec.   1036.540--Assigned Transmission Gear Ratios
----------------------------------------------------------------------------------------------------------------
                                                                                                  Tractors and
                                                           Light HDV and       Tractors and        heavy HDV,
                      Gear number                            medium HDV         heavy HDV,       highway cruise
                                                                             transient cycle         cycle
----------------------------------------------------------------------------------------------------------------
1......................................................               3.10               3.51               12.8
2......................................................               1.81               1.91               9.25
3......................................................               1.41               1.43               6.76
4......................................................               1.00               1.00               4.90
5......................................................               0.71               0.74               3.58
6......................................................               0.61               0.64               2.61

[[Page 74029]]

 
7......................................................  .................  .................               1.89
8......................................................  .................  .................               1.38
9......................................................  .................  .................               1.00
10.....................................................  .................  .................               0.73
----------------------------------------------------------------------------------------------------------------

    (3) Run GEM for each simulated vehicle configuration as follows:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.063
    
    [GRAPHIC] [TIFF OMITTED] TR25OC16.064
    
Where:

fn[speed] = engine's angular speed as determined in 
paragraph (c)(3)(ii) or (iii) of this section.
ktopgear = transmission gear ratio in the highest 
available gear from Table 4 of this section (for powertrain testing 
use actual top gear ratio).
vref = reference speed. Use 65 mi/hr for the transient 
cycle and the 65 mi/hr highway cruise cycle, and use 55 mi/hr for 
the 55 mi/hr highway cruise cycle.
[GRAPHIC] [TIFF OMITTED] TR25OC16.065

[GRAPHIC] [TIFF OMITTED] TR25OC16.066


[[Page 74030]]


    Example: 
    This example is for a vocational Light HDV or vocational Medium 
HDV with a 6-speed automatic transmission at B speed (Test 3 or 4 in 
Table 2 of this section).
fnrefB = 1870 r/min = 31.17 r/s
kaB = 4.0
ktopgear = 0.61
vref = 65 mi/hr = 29.06 m/s
[GRAPHIC] [TIFF OMITTED] TR25OC16.067

    (ii) Test at least eight different vehicle configurations for 
engines that will be installed in vocational Light HDV or vocational 
Medium HDV. If the engine will also be installed in vocational Heavy 
HDV, use good engineering judgment to select at least nine test 
configurations that best represent the range of vehicles. For example, 
if your engines will be installed in vocational Medium HDV and 
vocational Heavy HDV, you might select Tests 1 through 6 of Table 2 of 
this section to represent Class 7 vehicles and Tests 3, 6, and 9 of 
Table 3 of this section to represent Class 8 vehicles. You may test 
your engine using additional vehicle configurations with different 
ka and Crr values to represent a wider range of 
in-use vehicle configurations. Set CdA to 5.4 for all test 
configurations. For powertrain testing, set Mrotating to 340 
kg and Effaxle to 0.955 for all test configurations.
[GRAPHIC] [TIFF OMITTED] TR25OC16.068


corresponding designated engine speed (A, B, C, or fntest) 
at 65 mi/hr for the transient cycle and the 65 mi/hr highway cruise 
cycle, and at 55 mi/hr for the 55 mi/hr highway cruise cycle. These 
engine speeds apply equally for engines subject to spark-ignition 
standards. Use the following settings specific to each vehicle 
configuration:
[GRAPHIC] [TIFF OMITTED] TR25OC16.069

    (iii) Test nine different vehicle configurations for engines that 
will be installed in vocational Heavy HDV and for tractors that are not 
heavy-haul tractors. Test over six different test configurations for 
heavy-haul tractors. You may test your engines for additional 
configurations with different ka, CdA, and 
Crr values to represent a wider range of in-use vehicle 
configurations. Set Crr to 6.9 for all nine defined test 
configurations. For powertrain testing, set Effaxle to 0.955 
for all test configurations. Set the axle ratio, ka,
[GRAPHIC] [TIFF OMITTED] TR25OC16.070


engine speed (B, fntest, or the minimum NTE exclusion speed 
as determined in 40 CFR 86.1370(b)(1)) at 65 mi/hr. Use the settings 
specific to each test configuration as shown in Table 3 or Table 4 of 
this section, as appropriate.

[[Page 74031]]

Engines subject to testing under both Table 3 and Table 4 of this 
section need not repeat overlapping test configurations, so complete 
fuel mapping requires testing 12 (not 15) test configurations for those 
engines. Note that Mrotating is needed for powertrain 
testing but not for engine testing. Tables 3 and 4 follow:
[GRAPHIC] [TIFF OMITTED] TR25OC16.071

[GRAPHIC] [TIFF OMITTED] TR25OC16.072

    (iv) Use the defined values in Tables 1 through 4 of this section 
to set up GEM with the correct regulatory subcategory and vehicle 
weight reduction, if applicable, to achieve the target vehicle mass, M, 
for each test.
    (4) Use the GEM output of instantaneous engine speed and engine 
flywheel torque for each of the vehicle configurations to generate a 10 
Hz transient duty cycle corresponding to each vehicle configuration 
operating over each vehicle duty cycle.
    (d) Test the engine with GEM cycles. Test the engine over each of 
the transient duty cycles generated in paragraph (c) of this section as 
follows:
    (1) Precondition the engine either as described in 40 CFR 
1037.510(a)(2)(i) for the transient duty-cycle and 40 CFR 
1037.510(a)(2)(ii) for the highway cruise duty cycles using the Test 1 
vehicle configuration, and then continue testing the different 
configurations in the order presented in this section. Measure 
emissions as described in 40 CFR part 1065; perform cycle validation 
according to 40 CFR part 1065, subpart F, except as noted in this 
paragraph (d)(1). If the range of reference speeds is less than 10 
percent of the mean reference speed, you need to meet only the standard 
error of estimate in Table 2 of 40 CFR 1065.514. For purposes of cycle 
validation, treat points as being at idle if reference speed is at or 
below declared idle speed. For plug-in hybrid engines, precondition the 
battery and then complete all back-to-back tests for each test 
configuration according to 40 CFR 1066.501 before moving to the next 
test configuration. You may send signals to the engine controller 
during the test, such as current transmission gear and vehicle speed, 
if that allows engine operation during the test to better represent in-
use operation.
    (2) If an infrequent regeneration event occurs during a mapping 
test interval, invalidate that test interval. Continue operating the 
vehicle to allow the regeneration event to finish, then repeat engine 
preconditioning and resume testing at the start of the invalidated test 
cycle.
    (3) For each test, record measurements needed to determine fuel 
mass using carbon mass balance. Record speed and torque and measure 
emissions and other inputs as described in 40 CFR 1065.655(c). 
Manufacturers may instead measure fuel consumption with a fuel flow 
meter. For hybrid powertrains with no plug-in capability, correct for 
the net energy change of the energy storage device as described in 40 
CFR 1066.501. For plug-in hybrid engines, follow 40 CFR 1066.501 to

[[Page 74032]]

determine End-of-Test for charge-depleting operation; to do this, you 
must get our advance approval for a utility factor curve. We will 
approve your utility factor curve if you can show that you created it 
from sufficient in-use data of vehicles in the same application as the 
vehicles in which the PHEV engine will be installed.
    (4) Calculate the fuel mass flow rate, mfuel, for each 
duty cycle using one of the following equations:
    (i) Determine fuel-consumption rates using emission measurements 
from the raw or diluted exhaust, calculate the mass of fuel for each 
duty cycle, mfuel[cycle], as follows:
    (A) For calculations that use continuous measurement of emissions 
and continuous CO2 from urea, calculate 
mfuel[cycle] using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.073

Where:

MC = molar mass of carbon.
wCmeas = carbon mass fraction of fuel (or mixture of test 
fuels) as determined in 40 CFR 1065.655(d), except that you may not 
use the default properties in Table 1 of 40 CFR 1065.655 to 
determine [alpha], [beta], and wC for liquid fuels.
i = an indexing variable that represents one recorded emission 
value.
N = total number of measurements over the duty cycle.
nexh = exhaust molar flow rate from which you measured 
emissions.
xCcombdry = amount of carbon from fuel and any injected 
fluids in the exhaust per mole of dry exhaust as determined in 40 
CFR 1065.655(c).
xH2Oexhdry = amount of H2O in exhaust per mole 
of exhaust as determined in 40 CFR 1065.655(c).
[Delta]t = 1/frecord.
MCO2 = molar mass of carbon dioxide.
mCO2DEF = mass emission rate of CO2 resulting 
from diesel exhaust fluid decomposition over the duty cycle as 
determined from Sec.  1036.535(b)(10). If your engine does not 
utilize diesel exhaust fluid for emission control, or if you choose 
not to perform this correction, set mCO2DEF equal to 0.

    Example: 
MC = 12.0107 g/mol
wCmeas = 0.867
N = 6680
nexh1= 2.876 mol/s
nexh2= 2.224 mol/s
xCcombdry1= 2.61[middot]10-\3\ mol/mol
xCcombdry2= 1.91[middot]10-\3\ mol/mol
xH2Oexhdry1= 3.53[middot]10-\2\ mol/mol
xH2Oexhdry2= 3.13[middot]10-\2\ mol/mol
frecord = 10 Hz
[Delta]t = 1/10 = 0.1 s
MCO2 = 44.0095 g/mol
mCO2DEF1 = 0.0726 g/s
mCO2DEF2 = 0.0751 g/s
[GRAPHIC] [TIFF OMITTED] TR25OC16.074

Mfueltransient = 1619.6 g
    (B) If you measure batch emissions and continuous CO2 
from urea, calculate mfuel[cycle] using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.075

    (C) If you measure continuous emissions and batch CO2 
from urea, calculate mfuel[cycle] using the following 
equation:

[[Page 74033]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.076

    (D) If you measure batch emissions and batch CO2 from 
urea, calculate mfuel[cycle] using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.077

    (ii) Manufacturers may choose to measure fuel mass flow rate. 
Calculate the mass of fuel for each duty cycle, 
mfuel[cycle], as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.078

Where:

i = an indexing variable that represents one recorded value.
N = total number of measurements over the duty cycle. For batch fuel 
mass measurements, set N = 1.
mfueli = the fuel mass flow rate, for each point, i, 
starting from i = 1.
    [Delta]t = 1/frecord
    frecord = the data recording frequency.

    Example: 
N = 6680
mfuel1 = 1.856 g/s
mfuel2 = 1.962 g/s
frecord = 10 Hz
[Delta]t = 1/10 = 0.1 s
mfueltransient = (1.856 + 1.962 + . . . + 
mfuel6680)[middot]0.1
mfueltransient = 111.95 g

    (5) Correct the measured or calculated fuel mass flow rate, 
mfuel, for each test result to a mass-specific net energy 
content of a reference fuel as described in Sec.  1036.535(b)(11), 
replacing with mifuel with mfuel in Eq. 1036.535-
3.
    (6) For engines designed for plug-in hybrid electric vehicles, the 
mass of fuel for each cycle, mfuel[cycle], is the utility 
factor-weighted fuel mass. This is done by calculating mfuel 
for the full charge-depleting and charge-sustaining portions of the 
test and weighting the results, using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.079

Where:

mfuel[cycle],CD = total mass of fuel for all the tests in 
the charge-depleting portion of the test.
UFDCD = utility factor fraction at distance 
DCD as determined by interpolating the approved utility 
factor curve.
mfuel[cycle],CS = total mass of fuel for all the tests in 
the charge-sustaining portion of the test.
[GRAPHIC] [TIFF OMITTED] TR25OC16.080

Where:

v = vehicle velocity at each time step. For tests completed under 
this section, v is the vehicle velocity in the GEM duty-cycle file. 
For tests under 40 CFR

[[Page 74034]]

1037.550, v is the vehicle velocity as determined by Eq. 1037.550-1. 
Note that this should include complete and incomplete charge-
depleting tests.

    (e) Determine GEM inputs. Use the results of engine testing in 
paragraph (d) of this section to determine the GEM inputs for the 
transient duty cycle and optionally for each of the highway cruise 
cycles corresponding to each simulated vehicle configuration as 
follows:
    (1) Your declared fuel mass consumption, mfueltransient. 
The declared values may be at or above the values calculated in 
paragraph (d) of this section, as described in Sec.  1036.535(e).
    (2) Engine output speed per unit vehicle speed,
    [GRAPHIC] [TIFF OMITTED] TR25OC16.081
    

by taking the average engine speed measured during the engine test 
while the vehicle is moving and dividing it by the average vehicle 
speed provided by GEM. Note that the engine cycle created by GEM has a 
flag to indicate when the vehicle is moving.
    (3) Positive work determined accordering to 40 CFR 1065, 
Wtransient.
    (4) The following table illustrates the GEM data inputs 
corresponding to the different vehicle configurations:
[GRAPHIC] [TIFF OMITTED] TR25OC16.082

Subpart G--Special Compliance Provisions


Sec.  1036.601  What compliance provisions apply?

    (a) Engine and vehicle manufacturers, as well as owners, operators, 
and rebuilders of engines subject to the requirements of this part, and 
all other persons, must observe the provisions of this part, the 
provisions of 40 CFR part 1068, and the provisions of the Clean Air 
Act. The provisions of 40 CFR part 1068 apply for heavy-duty highway 
engines as specified in that part, subject to the following provisions:
    (1) The exemption provisions of 40 CFR 1068.201 through 1068.230, 
1068.240, and 1068.260 through 265 apply for heavy-duty motor vehicle 
engines. The other exemption provisions, which are specific to nonroad 
engines, do not apply for heavy-duty vehicles or heavy-duty engines.
    (2) The tampering prohibition in 40 CFR 1068.101(b)(1) applies for 
alternative fuel conversions as specified in 40 CFR part 85, subpart F.
    (3) The warranty-related prohibitions in section 203(a)(4) of the 
Act (42 U.S.C. 7522(a)(4)) apply to manufacturers of new heavy-duty 
highway engines in addition to the prohibitions described in 40 CFR 
1068.101(b)(6). We may assess a civil penalty up to $44,539 for each 
engine or vehicle in violation.
    (b) Engines exempted from the applicable standards of 40 CFR part 
86 under the provisions of 40 CFR part 1068 are exempt from the 
standards of this part without request.
    (c) The emergency vehicle field modification provisions of 40 CFR 
85.1716 apply with respect to the standards of this part.
    (d) Subpart C of this part describes how to test and certify dual-
fuel and flexible-fuel engines. Some multi-fuel engines may not fit 
either of those defined terms. For such engines, we will determine 
whether it is most appropriate to treat them as single-fuel engines, 
dual-fuel engines, or flexible-fuel engines based on the range of 
possible and expected fuel mixtures. For example, an engine might burn 
natural gas but initiate combustion with a pilot injection of diesel 
fuel. If the engine is designed to operate with a single fueling 
algorithm (i.e., fueling rates are fixed at a given engine speed and 
load condition), we would generally treat it as a single-fuel engine. 
In this context, the combination of diesel fuel and natural gas would 
be its own fuel type. If the engine is designed to also operate on 
diesel fuel alone, we would generally treat it as a dual-fuel engine. 
If the engine is designed to operate on varying mixtures of the two 
fuels, we would generally treat it as a flexible-fuel engine. To the 
extent that requirements vary for the different fuels or fuel mixtures, 
we may apply the more stringent requirements.


Sec.  1036.605  GHG exemption for engines used in specialty vehicles.

    Engines certified to the alternative standards specified in 40 CFR 
86.007-11 and 86.008-10 for use in specialty vehicles as described in 
40 CFR 1037.605 are exempt from the standards of this part. See 40 CFR 
part 1037 for provisions that apply to the vehicle.


Sec.  1036.610  Off-cycle technology credits and adjustments for 
reducing greenhouse gas emissions.

    (a) You may ask us to apply the provisions of this section for 
CO2 emission reductions resulting from powertrain 
technologies that were not in common use with heavy-duty vehicles 
before model year 2010 that are not reflected in the specified test 
procedure. While you are not required to prove that such technologies 
were not in common use with heavy-duty vehicles before model year 2010, 
we will not approve your request if we determine that they do not 
qualify. We will apply these provisions only for technologies that will 
result in a measurable, demonstrable, and verifiable real-world

[[Page 74035]]

CO2 reduction. Note that prior to model year 2016, these 
technologies were referred to as ``innovative technologies''.
    (b) The provisions of this section may be applied as either an 
improvement factor (used to adjust emission results) or as a separate 
credit, consistent with good engineering judgment. Note that the term 
``credit'' in this section describes an additive adjustment to emission 
rates and is not equivalent to an emission credit in the ABT program of 
subpart H of this part. We recommend that you base your credit/
adjustment on A to B testing of pairs of engines/vehicles differing 
only with respect to the technology in question.
    (1) Calculate improvement factors as the ratio of in-use emissions 
with the technology divided by the in-use emissions without the 
technology. Adjust the emission results by multiplying by the 
improvement factor. Use the improvement-factor approach where good 
engineering judgment indicates that the actual benefit will be 
proportional to emissions measured over the test procedures specified 
in this part. For example, the benefits from technologies that reduce 
engine operation would generally be proportional to the engine's 
emission rate.
    (2) Calculate separate credits based on the difference between the 
in-use emission rate (g/ton-mile) with the technology and the in-use 
emission rate without the technology. Subtract this value from your 
measured emission result and use this adjusted value to determine your 
FEL. We may also allow you to calculate the credits based on g/hp-hr 
emission rates. Use the separate-credit approach where good engineering 
judgment indicates that the actual benefit will not be proportional to 
emissions measured over the test procedures specified in this part.
    (3) We may require you to discount or otherwise adjust your 
improvement factor or credit to account for uncertainty or other 
relevant factors.
    (c) Send your request to the Designated Compliance Officer. We 
recommend that you do not begin collecting test data (for submission to 
EPA) before contacting us. For technologies for which the vehicle 
manufacturer could also claim credits (such as transmissions in certain 
circumstances), we may require you to include a letter from the vehicle 
manufacturer stating that it will not seek credits for the same 
technology. Your request must contain the following items:
    (1) A detailed description of the off-cycle technology and how it 
functions to reduce CO2 emissions under conditions not 
represented on the duty cycles required for certification.
    (2) A list of the engine configurations that will be equipped with 
the technology.
    (3) A detailed description and justification of the selected test 
engines.
    (4) All testing and simulation data required under this section, 
plus any other data you have considered in your analysis. You may ask 
for our preliminary approval of your test plan under Sec.  1036.210.
    (5) A complete description of the methodology used to estimate the 
off-cycle benefit of the technology and all supporting data, including 
engine testing and in-use activity data. Also include a statement 
regarding your recommendation for applying the provisions of this 
section for the given technology as an improvement factor or a credit.
    (6) An estimate of the off-cycle benefit by engine model, and the 
fleetwide benefit based on projected sales of engine models equipped 
with the technology.
    (7) A demonstration of the in-use durability of the off-cycle 
technology, based on any available engineering analysis or durability 
testing data (either by testing components or whole engines).
    (d) We may seek public comment on your request, consistent with the 
provisions of 40 CFR 86.1869-12(d). However, we will generally not seek 
public comment on credits/adjustments based on A to B engine 
dynamometer testing, chassis testing, or in-use testing.
    (e) We may approve an improvement factor or credit for any 
configuration that is properly represented by your testing.
    (1) For model years before 2021, you may continue to use an 
approved improvement factor or credit for any appropriate engine 
families in future model years through 2020.
    (2) For model years 2021 and later, you may not rely on an approval 
for model years before 2021. You must separately request our approval 
before applying an improvement factor or credit under this section for 
2021 and later engines, even if we approved an improvement factor or 
credit for similar engine models before model year 2021. Note that 
approvals for model year 2021 and later may carry over for multiple 
years.


Sec.  1036.615  Engines with Rankine cycle waste heat recovery and 
hybrid powertrains.

    This section specifies how to generate advanced-technology emission 
credits for hybrid powertrains that include energy storage systems and 
regenerative braking (including regenerative engine braking) and for 
engines that include Rankine-cycle (or other bottoming cycle) exhaust 
energy recovery systems. This section applies only for model year 2020 
and earlier engines.
    (a) Pre-transmission hybrid powertrains. Test pre-transmission 
hybrid powertrains with the hybrid engine test procedures of 40 CFR 
part 1065 or with the post-transmission test procedures in 40 CFR 
1037.550. Pre-transmission hybrid powertrains are those engine systems 
that include features to recover and store energy during engine 
motoring operation but not from the vehicle's wheels. Engines certified 
with pre-transmission hybrid powertrains must be certified to meet the 
diagnostic requirements of 40 CFR 86.018-10 with respect to powertrain 
components and systems; if different manufacturers produce the engine 
and the hybrid powertrain, the hybrid powertrain manufacturer may 
separately certify its powertrain relative to diagnostic requirements.
    (b) Rankine engines. Test engines that include Rankine-cycle 
exhaust energy recovery systems according to the test procedures 
specified in subpart F of this part unless we approve alternate 
procedures.
    (c) Calculating credits. Calculate credits as specified in subpart 
H of this part. Credits generated from engines and powertrains 
certified under this section may be used in other averaging sets as 
described in Sec.  1036.740(c).
    (d) Off-cycle technologies. You may certify using both the 
provisions of this section and the off-cycle technology provisions of 
Sec.  1036.610, provided you do not double-count emission benefits.


Sec.  1036.620  Alternate CO2 standards based on model year 
2011 compression-ignition engines.

    For model years 2014 through 2016, you may certify your 
compression-ignition engines to the CO2 standards of this 
section instead of the CO2 standards in Sec.  1036.108. 
However, you may not certify engines to these alternate standards if 
they are part of an averaging set in which you carry a balance of 
banked credits. You may submit applications for certifications before 
using up banked credits in the averaging set, but such certificates 
will not become effective until you have used up (or retired) your 
banked credits in the averaging set. For purposes of this section, you 
are deemed to carry credits in an averaging set if you carry credits 
from advanced technology that are allowed to be used in that averaging 
set.

[[Page 74036]]

    (a) The standards of this section are determined from the measured 
emission rate of the test engine of the applicable baseline 2011 engine 
family or families as described in paragraphs (b) and (c) of this 
section. Calculate the CO2 emission rate of the baseline 
test engine using the same equations used for showing compliance with 
the otherwise applicable standard. The alternate CO2 
standard for light and medium heavy-duty vocational-certified engines 
(certified for CO2 using the transient cycle) is equal to 
the baseline emission rate multiplied by 0.975. The alternate 
CO2 standard for tractor-certified engines (certified for 
CO2 using the ramped-modal cycle) and all other heavy heavy-
duty engines is equal to the baseline emission rate multiplied by 
0.970. The in-use FEL for these engines is equal to the alternate 
standard multiplied by 1.03.
    (b) This paragraph (b) applies if you do not certify all your 
engine families in the averaging set to the alternate standards of this 
section. Identify separate baseline engine families for each engine 
family that you are certifying to the alternate standards of this 
section. For an engine family to be considered the baseline engine 
family, it must meet the following criteria:
    (1) It must have been certified to all applicable emission 
standards in model year 2011. If the baseline engine was certified to a 
NOX FEL above the standard and incorporated the same 
emission control technologies as the new engine family, you may adjust 
the baseline CO2 emission rate to be equivalent to an engine 
meeting the 0.20 g/hp-hr NOX standard (or your higher FEL as 
specified in this paragraph (b)(1)), using certification results from 
model years 2009 through 2011, consistent with good engineering 
judgment.
    (i) Use the following equation to relate model year 2009-2011 
NOX and CO2 emission rates (g/hp-hr): 
CO2 = a x log(NOX)+b.
    (ii) For model year 2014-2016 engines certified to NOX 
FELs above 0.20 g/hp-hr, correct the baseline CO2 emissions 
to the actual NOX FELs of the 2014-2016 engines.
    (iii) Calculate separate adjustments for emissions over the ramped-
modal cycle and the transient cycle.
    (2) The baseline configuration tested for certification must have 
the same engine displacement as the engines in the engine family being 
certified to the alternate standards, and its rated power must be 
within five percent of the highest rated power in the engine family 
being certified to the alternate standards.
    (3) The model year 2011 U.S.-directed production volume of the 
configuration tested must be at least one percent of the total 2011 
U.S.-directed production volume for the engine family.
    (4) The tested configuration must have cycle-weighted BSFC 
equivalent to or better than all other configurations in the engine 
family.
    (c) This paragraph (c) applies if you certify all your engine 
families in the primary intended service class to the alternate 
standards of this section. For purposes of this section, you may 
combine light heavy-duty and medium heavy-duty engines into a single 
averaging set. Determine your baseline CO2 emission rate as 
the production-weighted emission rate of the certified engine families 
you produced in the 2011 model year. If you produce engines for both 
tractors and vocational vehicles, treat them as separate averaging 
sets. Adjust the CO2 emission rates to be equivalent to an 
engine meeting the average NOX FEL of new engines (assuming 
engines certified to the 0.20 g/hp-hr NOX standard have a 
NOX FEL equal to 0.20 g/hp-hr), as described in paragraph 
(b)(1) of this section.
    (d) Include the following statement on the emission control 
information label: ``THIS ENGINE WAS CERTIFIED TO AN ALTERNATE 
CO2 STANDARD UNDER Sec.  1036.620.''
    (e) You may not bank CO2 emission credits for any engine 
family in the same averaging set and model year in which you certify 
engines to the standards of this section. You may not bank any 
advanced-technology credits in any averaging set for the model year you 
certify under this section (since such credits would be available for 
use in this averaging set). Note that the provisions of Sec.  1036.745 
apply for deficits generated with respect to the standards of this 
section.
    (f) You need our approval before you may certify engines under this 
section, especially with respect to the numerical value of the 
alternate standards. We will not approve your request if we determine 
that you manipulated your engine families or test engine configurations 
to certify to less stringent standards, or that you otherwise have not 
acted in good faith. You must keep and provide to us any information we 
need to determine that your engine families meet the requirements of 
this section. Keep these records for at least five years after you stop 
producing engines certified under this section.


Sec.  1036.625  In-use compliance with family emission limits (FELs).

    Section 1036.225 describes how to change the FEL for an engine 
family during the model year. This section, which describes how you may 
ask us to increase an engine family's FEL after the end of the model 
year, is intended to address circumstances in which it is in the public 
interest to apply a higher in-use FEL based on forfeiting an 
appropriate number of emission credits. For example, this may be 
appropriate where we determine that recalling vehicles would not 
significantly reduce in-use emissions. We will generally not allow this 
option where we determine the credits being forfeited would likely have 
expired.
    (a) You may ask us to increase an engine family's FEL after the end 
of the model year if you believe some of your in-use engines exceed the 
CO2 FEL that applied during the model year (or the 
CO2 emission standard if the family did not generate or use 
emission credits). We may consider any available information in making 
our decision to approve or deny your request.
    (b) If we approve your request under this section, you must apply 
emission credits to cover the increased FEL for all affected engines. 
Apply the emission credits as part of your credit demonstration for the 
current production year. Include the appropriate calculations in your 
final report under Sec.  1036.730.
    (c) Submit your request to the Designated Compliance Officer. 
Include the following in your request:
    (1) Identify the names of each engine family that is the subject of 
your request. Include separate family names for different model years.
    (2) Describe why your request does not apply for similar engine 
models or additional model years, as applicable.
    (3) Identify the FEL(s) that applied during the model year and 
recommend a replacement FEL for in-use engines; include a supporting 
rationale to describe how you determined the recommended replacement 
FEL.
    (4) Describe whether the needed emission credits will come from 
averaging, banking, or trading.
    (d) If we approve your request, we will identify the replacement 
FEL. The value we select will reflect our best judgment to accurately 
reflect the actual in-use performance of your engines, consistent with 
the testing provisions specified in this part. We may apply the higher 
FELs to other engine families from the same or different model years to 
the extent they used equivalent emission controls. We may include any

[[Page 74037]]

appropriate conditions with our approval.
    (e) If we order a recall for an engine family under 40 CFR 
1068.505, we will no longer approve a replacement FEL under this 
section for any of your engines from that engine family, or from any 
other engine family that relies on equivalent emission controls.


Sec.  1036.630  Certification of engine GHG emissions for powertrain 
testing.

    For engines included in powertrain families under 40 CFR part 1037, 
you may choose to include the corresponding engine emissions in your 
engine families under this part 1036 instead of (or in addition to) the 
otherwise applicable engine fuel maps.
    (a) If you choose to certify powertrain fuel maps in an engine 
family, the declared powertrain emission levels become standards that 
apply for selective enforcement audits and in-use testing. We may 
require that you provide to us the engine test cycle (not normalized) 
corresponding to a given powertrain for each of the specified duty 
cycles.
    (b) If you choose to certify only fuel map emissions for an engine 
family and to not certify emissions over powertrain test cycles under 
40 CFR 1037.550, we will not presume you are responsible for emissions 
over the powertrain cycles. However, where we determine that you are 
responsible in whole or in part for the emission exceedance in such 
cases, we may require that you participate in any recall of the 
affected vehicles. Note that this provision to limit your 
responsibility does not apply if you also hold the certificate of 
conformity for the vehicle.
    (c) If you split an engine family into subfamilies based on 
different fuel-mapping procedures as described in Sec.  1036.230(e), 
the fuel-mapping procedures you identify for certifying each subfamily 
also apply for selective enforcement audits and in-use testing.

Subpart H--Averaging, Banking, and Trading for Certification


Sec.  1036.701  General provisions.

    (a) You may average, bank, and trade (ABT) emission credits for 
purposes of certification as described in this subpart and in subpart B 
of this part to show compliance with the standards of Sec.  1036.108. 
Participation in this program is voluntary. (Note: As described in 
subpart B of this part, you must assign an FCL to all engine families, 
whether or not they participate in the ABT provisions of this subpart.)
    (b) The definitions of subpart I of this part apply to this subpart 
in addition to the following definitions:
    (1) Actual emission credits means emission credits you have 
generated that we have verified by reviewing your final report.
    (2) Averaging set means a set of engines in which emission credits 
may be exchanged. See Sec.  1036.740.
    (3) Broker means any entity that facilitates a trade of emission 
credits between a buyer and seller.
    (4) Buyer means the entity that receives emission credits as a 
result of a trade.
    (5) Reserved emission credits means emission credits you have 
generated that we have not yet verified by reviewing your final report.
    (6) Seller means the entity that provides emission credits during a 
trade.
    (7) Standard means the emission standard that applies under subpart 
B of this part for engines not participating in the ABT program of this 
subpart.
    (8) Trade means to exchange emission credits, either as a buyer or 
seller.
    (c) Emission credits may be exchanged only within an averaging set, 
except as specified in Sec.  1036.740.
    (d) You may not use emission credits generated under this subpart 
to offset any emissions that exceed an FCL or standard. This applies 
for all testing, including certification testing, in-use testing, 
selective enforcement audits, and other production-line testing. 
However, if emissions from an engine exceed an FCL or standard (for 
example, during a selective enforcement audit), you may use emission 
credits to recertify the engine family with a higher FCL that applies 
only to future production.
    (e) You may use either of the following approaches to retire or 
forego emission credits:
    (1) You may retire emission credits generated from any number of 
your engines. This may be considered donating emission credits to the 
environment. Identify any such credits in the reports described in 
Sec.  1036.730. Engines must comply with the applicable FELs even if 
you donate or sell the corresponding emission credits under this 
paragraph (h). Those credits may no longer be used by anyone to 
demonstrate compliance with any EPA emission standards.
    (2) You may certify an engine family using an FEL (FCL for 
CO2) below the emission standard as described in this part 
and choose not to generate emission credits for that family. If you do 
this, you do not need to calculate emission credits for those engine 
families and you do not need to submit or keep the associated records 
described in this subpart for that family.
    (f) Emission credits may be used in the model year they are 
generated. Surplus emission credits may be banked for future model 
years. Surplus emission credits may sometimes be used for past model 
years, as described in Sec.  1036.745.
    (g) You may increase or decrease an FCL during the model year by 
amending your application for certification under Sec.  1036.225. The 
new FCL may apply only to engines you have not already introduced into 
commerce.
    (h) See Sec.  1036.740 for special credit provisions that apply for 
greenhouse gas credits generated under 40 CFR 86.1819-14(k)(7) or Sec.  
1036.615 or 40 CFR 1037.615.
    (i) Unless the regulations explicitly allow it, you may not 
calculate credits more than once for any emission reduction. For 
example, if you generate CO2 emission credits for a hybrid 
engine under this part for a given vehicle, no one may generate 
CO2 emission credits for that same hybrid engine and vehicle 
under 40 CFR part 1037. However, credits could be generated for 
identical vehicles using engines that did not generate credits under 
this part.
    (j) Credits you generate with compression-ignition engines in 2020 
and earlier model years may be used in model year 2021 and later only 
if the credit-generating engines were certified to the tractor engine 
standards in Sec.  1036.108 and credits were calculated relative to the 
tractor engine standards. You may otherwise use emission credits 
generated in one model year without adjustment for certifying vehicles 
in a later model year, even if emission standards are different.
    (k) Engine families you certify with a nonconformance penalty under 
40 CFR part 86, subpart L, may not generate emission credits.


Sec.  1036.705  Generating and calculating emission credits.

    (a) The provisions of this section apply separately for calculating 
emission credits for each pollutant.
    (b) For each participating family, calculate positive or negative 
emission credits relative to the otherwise applicable emission standard 
based on the engine family's FCL for greenhouse gases. If your engine 
family is certified to both the vocational and tractor engine 
standards, calculate credits separately for the vocational engines and 
the tractor engines (as specified in paragraph (b)(3) of this section). 
Calculate positive emission credits for a family that has an FCL below 
the standard. Calculate negative emission credits for a family that has 
an FCL above the standard. Sum your positive

[[Page 74038]]

and negative credits for the model year before rounding. Round the sum 
of emission credits to the nearest megagram (Mg), using consistent 
units throughout the following equations:
    (1) For vocational engines:

Emission credits (Mg) = (Std-FCL) [middot] (CF) [middot] (Volume) 
[middot] (UL) [middot] (10-6)

Where:

Std = the emission standard, in g/hp-hr, that applies under subpart 
B of this part for engines not participating in the ABT program of 
this subpart (the ``otherwise applicable standard'').
FCL = the Family Certification Level for the engine family, in g/hp-
hr, measured over the transient duty cycle, rounded to the same 
number of decimal places as the emission standard.
CF = a transient cycle conversion factor (hp-hr/mile), calculated by 
dividing the total (integrated) horsepower-hour over the duty cycle 
(average of vocational engine configurations weighted by their 
production volumes) by 6.3 miles for engines subject to spark-
ignition standards and 6.5 miles for engines subject to compression-
ignition. This represents the average work performed by vocational 
engines in the family over the mileage represented by operation over 
the duty cycle.
Volume = the number of vocational engines eligible to participate in 
the averaging, banking, and trading program within the given engine 
family during the model year, as described in paragraph (c) of this 
section.
UL = the useful life for the given engine family, in miles.

    (2) For tractor engines:

Emission credits (Mg) = (Std-FCL) [middot] (CF) [middot] (Volume) 
[middot] (UL) [middot] (10-6)

Where:

Std = the emission standard, in g/hp-hr, that applies under subpart 
B of this part for engines not participating in the ABT program of 
this subpart (the ``otherwise applicable standard'').
FCL = the Family Certification Level for the engine family, in g/hp-
hr, measured over the ramped-modal cycle rounded to the same number 
of decimal places as the emission standard.
CF = a transient cycle conversion factor (hp-hr/mile), calculated by 
dividing the total (integrated) horsepower-hour over the duty cycle 
(average of tractor-engine configurations weighted by their 
production volumes) by 6.3 miles for engines subject to spark-
ignition standards and 6.5 miles for engines subject to compression-
ignition standards. This represents the average work performed by 
tractor engines in the family over the mileage represented by 
operation over the duty cycle. Note that this calculation requires 
you to use the transient cycle conversion factor even for engines 
certified to standards based on the ramped-modal cycle.
Volume = the number of tractor engines eligible to participate in 
the averaging, banking, and trading program within the given engine 
family during the model year, as described in paragraph (c) of this 
section.
UL = the useful life for the given engine family, in miles.

    (3) For engine families certified to both the vocational and 
tractor engine standards, we may allow you to use statistical methods 
to estimate the total production volumes where a small fraction of the 
engines cannot be tracked precisely.
    (4) You may not generate emission credits for tractor engines 
(i.e., engines not certified to the transient cycle for CO2) 
installed in vocational vehicles (including vocational tractors 
certified under 40 CFR 1037.630 or exempted under 40 CFR 1037.631). We 
will waive this provision where you demonstrate that less than five 
percent of the engines in your tractor family were installed in 
vocational vehicles. For example, if you know that 96 percent of your 
tractor engines were installed in non-vocational tractors, but cannot 
determine the vehicle type for the remaining four percent, you may 
generate credits for all the engines in the family.
    (5) You may generate CO2 emission credits from a model 
year 2021 or later medium heavy-duty engine family subject to spark-
ignition standards for exchanging with other engine families only if 
the engines in the family are gasoline-fueled. You may generate 
CO2 credits from these engine families only for the purpose 
of offsetting CH4 and/or N2O emissions within the 
same engine family as described in paragraph (d) of this section.
    (c) As described in Sec.  1036.730, compliance with the 
requirements of this subpart is determined at the end of the model year 
based on actual U.S.-directed production volumes. Keep appropriate 
records to document these production volumes. Do not include any of the 
following engines to calculate emission credits:
    (1) Engines that you do not certify to the CO2 standards 
of this part because they are permanently exempted under subpart G of 
this part or under 40 CFR part 1068.
    (2) Exported engines.
    (3) Engines not subject to the requirements of this part, such as 
those excluded under Sec.  1036.5. For example, do not include engines 
used in vehicles certified to the greenhouse gas standards of 40 CFR 
86.1819.
    (4) Any other engines if we indicate elsewhere in this part 1036 
that they are not to be included in the calculations of this subpart.
    (d) You may use CO2 emission credits to show compliance 
with CH4 and/or N2O FELs instead of the otherwise 
applicable emission standards. To do this, calculate the CH4 
and/or N2O emission credits needed (negative credits) using 
the equation in paragraph (b) of this section, using the FEL(s) you 
specify for your engines during certification instead of the FCL. You 
must use 34 Mg of positive CO2 credits to offset 1 Mg of 
negative CH4 credits for model year 2021 and later engines, 
and you must use 25 Mg of positive CO2 credits to offset 1 
Mg of negative CH4 credits for earlier engines. You must use 
298 Mg of positive CO2 credits to offset 1 Mg of negative 
N2O credits.


Sec.  1036.710  Averaging.

    (a) Averaging is the exchange of emission credits among your engine 
families. You may average emission credits only within the same 
averaging set, except as specified in Sec.  1036.740.
    (b) You may certify one or more engine families to an FCL above the 
applicable standard, subject to any applicable FEL caps and other the 
provisions in subpart B of this part, if you show in your application 
for certification that your projected balance of all emission-credit 
transactions in that model year is greater than or equal to zero, or 
that a negative balance is allowed under Sec.  1036.745.
    (c) If you certify an engine family to an FCL that exceeds the 
otherwise applicable standard, you must obtain enough emission credits 
to offset the engine family's deficit by the due date for the final 
report required in Sec.  1036.730. The emission credits used to address 
the deficit may come from your other engine families that generate 
emission credits in the same model year (or from later model years as 
specified in Sec.  1036.745), from emission credits you have banked, or 
from emission credits you obtain through trading.


Sec.  1036.715  Banking.

    (a) Banking is the retention of surplus emission credits by the 
manufacturer generating the emission credits for use in future model 
years for averaging or trading.
    (b) You may designate any emission credits you plan to bank in the 
reports you submit under Sec.  1036.730 as reserved credits. During the 
model year and before the due date for the final report, you may 
designate your reserved emission credits for averaging or trading.
    (c) Reserved credits become actual emission credits when you submit 
your final report. However, we may revoke these emission credits if we 
are unable to verify them after reviewing your reports or auditing your 
records.

[[Page 74039]]

    (d) Banked credits retain the designation of the averaging set in 
which they were generated.


Sec.  1036.720  Trading.

    (a) Trading is the exchange of emission credits between 
manufacturers. You may use traded emission credits for averaging, 
banking, or further trading transactions. Traded emission credits 
remain subject to the averaging-set restrictions based on the averaging 
set in which they were generated.
    (b) You may trade actual emission credits as described in this 
subpart. You may also trade reserved emission credits, but we may 
revoke these emission credits based on our review of your records or 
reports or those of the company with which you traded emission credits. 
You may trade banked credits within an averaging set to any certifying 
manufacturer.
    (c) If a negative emission credit balance results from a 
transaction, both the buyer and seller are liable, except in cases we 
deem to involve fraud. See Sec.  1036.255(e) for cases involving fraud. 
We may void the certificates of all engine families participating in a 
trade that results in a manufacturer having a negative balance of 
emission credits. See Sec.  1036.745.


Sec.  1036.725  What must I include in my application for 
certification?

    (a) You must declare in your application for certification your 
intent to use the provisions of this subpart for each engine family 
that will be certified using the ABT program. You must also declare the 
FELs/FCL you select for the engine family for each pollutant for which 
you are using the ABT program. Your FELs must comply with the 
specifications of subpart B of this part, including the FEL caps. FELs/
FCLs must be expressed to the same number of decimal places as the 
applicable standards.
    (b) Include the following in your application for certification:
    (1) A statement that, to the best of your belief, you will not have 
a negative balance of emission credits for any averaging set when all 
emission credits are calculated at the end of the year; or a statement 
that you will have a negative balance of emission credits for one or 
more averaging sets, but that it is allowed under Sec.  1036.745.
    (2) Detailed calculations of projected emission credits (positive 
or negative) based on projected U.S.-directed production volumes. We 
may require you to include similar calculations from your other engine 
families to project your net credit balances for the model year. If you 
project negative emission credits for a family, state the source of 
positive emission credits you expect to use to offset the negative 
emission credits.


Sec.  1036.730  ABT reports.

    (a) If any of your engine families are certified using the ABT 
provisions of this subpart, you must send an end-of-year report by 
March 31 following the end of the model year and a final report by 
September 30 following the end of the model year. We may waive the 
requirement to send an end-of-year report.
    (b) Your end-of-year and final reports must include the following 
information for each engine family participating in the ABT program:
    (1) Engine-family designation and averaging set.
    (2) The emission standards that would otherwise apply to the engine 
family.
    (3) The FCL for each pollutant. If you change the FCL after the 
start of production, identify the date that you started using the new 
FCL and/or give the engine identification number for the first engine 
covered by the new FCL. In this case, identify each applicable FCL and 
calculate the positive or negative emission credits as specified in 
Sec.  1036.225.
    (4) The projected and actual U.S.-directed production volumes for 
the model year. If you changed an FCL during the model year, identify 
the actual production volume associated with each FCL.
    (5) The transient cycle conversion factor for each engine 
configuration as described in Sec.  1036.705.
    (6) Useful life.
    (7) Calculated positive or negative emission credits for the whole 
engine family. Identify any emission credits that you traded, as 
described in paragraph (d)(1) of this section.
    (c) Your end-of-year and final reports must include the following 
additional information:
    (1) Show that your net balance of emission credits from all your 
participating engine families in each averaging set in the applicable 
model year is not negative, except as allowed under Sec.  1036.745. 
Your credit tracking must account for the limitation on credit life 
under Sec.  1036.740(d).
    (2) State whether you will reserve any emission credits for 
banking.
    (3) State that the report's contents are accurate.
    (d) If you trade emission credits, you must send us a report within 
90 days after the transaction, as follows:
    (1) As the seller, you must include the following information in 
your report:
    (i) The corporate names of the buyer and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) The averaging set corresponding to the engine families that 
generated emission credits for the trade, including the number of 
emission credits from each averaging set.
    (2) As the buyer, you must include the following information in 
your report:
    (i) The corporate names of the seller and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) How you intend to use the emission credits, including the 
number of emission credits you intend to apply for each averaging set.
    (e) Send your reports electronically to the Designated Compliance 
Officer using an approved information format. If you want to use a 
different format, send us a written request with justification for a 
waiver.
    (f) Correct errors in your end-of-year or final report as follows:
    (1) You may correct any errors in your end-of-year report when you 
prepare the final report, as long as you send us the final report by 
the time it is due.
    (2) If you or we determine within 270 days after the end of the 
model year that errors mistakenly decreased your balance of emission 
credits, you may correct the errors and recalculate the balance of 
emission credits. You may not make these corrections for errors that 
are determined more than 270 days after the end of the model year. If 
you report a negative balance of emission credits, we may disallow 
corrections under this paragraph (f)(2).
    (3) If you or we determine any time that errors mistakenly 
increased your balance of emission credits, you must correct the errors 
and recalculate the balance of emission credits.


Sec.  1036.735  Recordkeeping.

    (a) You must organize and maintain your records as described in 
this section. We may review your records at any time.
    (b) Keep the records required by this section for at least eight 
years after the due date for the end-of-year report. You may not use 
emission credits for any engines if you do not keep all the records 
required under this section. You must therefore keep these records to 
continue to bank valid credits. Store these records in any format and 
on any media, as long as you can promptly send us organized, written 
records in English if we ask for them. You must keep these records 
readily available. We may review them at any time.
    (c) Keep a copy of the reports we require in Sec. Sec.  1036.725 
and 1036.730.

[[Page 74040]]

    (d) Keep records of the engine identification number (usually the 
serial number) for each engine you produce that generates or uses 
emission credits under the ABT program. You may identify these numbers 
as a range. If you change the FEL after the start of production, 
identify the date you started using each FCL and the range of engine 
identification numbers associated with each FCL. You must also identify 
the purchaser and destination for each engine you produce to the extent 
this information is available.
    (e) We may require you to keep additional records or to send us 
relevant information not required by this section in accordance with 
the Clean Air Act.


Sec.  1036.740  Restrictions for using emission credits.

    The following restrictions apply for using emission credits:
    (a) Averaging sets. Except as specified in paragraph (c) of this 
section, emission credits may be exchanged only within the following 
averaging sets:
    (1) Engines subject to spark-ignition standards.
    (2) Light heavy-duty engines subject to compression-ignition 
standards.
    (3) Medium heavy-duty engines subject to compression-ignition 
standards.
    (4) Heavy heavy-duty engines.
    (b) Applying credits to prior year deficits. Where your credit 
balance for the previous year is negative, you may apply credits to 
that credit deficit only after meeting your credit obligations for the 
current year.
    (c) Credits from hybrid engines and other advanced technologies. 
Credits you generate under Sec.  1036.615 may be used for any of the 
averaging sets identified in paragraph (a) of this section; you may 
also use those credits to demonstrate compliance with the 
CO2 emission standards in 40 CFR 86.1819 and 40 CFR part 
1037. Similarly, you may use Phase 1 advanced-technology credits 
generated under 40 CFR 86.1819-14(k)(7) or 40 CFR 1037.615 to 
demonstrate compliance with the CO2 standards in this part. 
In the case of engines subject to spark-ignition standards and 
compression-ignition light heavy-duty engines, you may not use more 
than 60,000 Mg of credits from other averaging sets in any model year.
    (1) The maximum amount of CO2 credits you may bring into 
the following service class groups is 60,000 Mg per model year:
    (i) Engines subject to spark-ignition standards, light heavy-duty 
compression-ignition engines, and light heavy-duty vehicles. This group 
comprises the averaging sets listed in paragraphs (a)(1) and (2) of 
this section and the averaging set listed in 40 CFR 1037.740(a)(1).
    (ii) Medium heavy-duty engines subject to compression-ignition 
standards and medium heavy-duty vehicles. This group comprises the 
averaging sets listed in paragraph (a)(3) of this section and 40 CFR 
1037.740(a)(2).
    (iii) Heavy heavy-duty engines subject to compression-ignition 
standards and heavy heavy-duty vehicles. This group comprises the 
averaging sets listed in paragraph (a)(4) of this section and 40 CFR 
1037.740(a)(3).
    (2) Paragraph (c)(1) of this section does not limit the advanced-
technology credits that can be used within a service class group if 
they were generated in that same service class group.
    (d) Credit life. Credits may be used only for five model years 
after the year in which they are generated. For example, credits you 
generate in model year 2018 may be used to demonstrate compliance with 
emission standards only through model year 2023.
    (e) Other restrictions. Other sections of this part specify 
additional restrictions for using emission credits under certain 
special provisions.


Sec.  1036.745  End-of-year CO2 credit deficits.

    Except as allowed by this section, we may void the certificate of 
any engine family certified to an FCL above the applicable standard for 
which you do not have sufficient credits by the deadline for submitting 
the final report.
    (a) Your certificate for an engine family for which you do not have 
sufficient CO2 credits will not be void if you remedy the 
deficit with surplus credits within three model years. For example, if 
you have a credit deficit of 500 Mg for an engine family at the end of 
model year 2015, you must generate (or otherwise obtain) a surplus of 
at least 500 Mg in that same averaging set by the end of model year 
2018.
    (b) You may not bank or trade away CO2 credits in the 
averaging set in any model year in which you have a deficit.
    (c) You may apply only surplus credits to your deficit. You may not 
apply credits to a deficit from an earlier model year if they were 
generated in a model year for which any of your engine families for 
that averaging set had an end-of-year credit deficit.
    (d) You must notify us in writing how you plan to eliminate the 
credit deficit within the specified time frame. If we determine that 
your plan is unreasonable or unrealistic, we may deny an application 
for certification for a vehicle family if its FEL would increase your 
credit deficit. We may determine that your plan is unreasonable or 
unrealistic based on a consideration of past and projected use of 
specific technologies, the historical sales mix of your vehicle models, 
your commitment to limit production of higher-emission vehicles, and 
expected access to traded credits. We may also consider your plan 
unreasonable if your credit deficit increases from one model year to 
the next. We may require that you send us interim reports describing 
your progress toward resolving your credit deficit over the course of a 
model year.
    (e) If you do not remedy the deficit with surplus credits within 
three model years, we may void your certificate for that engine family. 
We may void the certificate based on your end-of-year report. Note that 
voiding a certificate applies ab initio. Where the net deficit is less 
than the total amount of negative credits originally generated by the 
family, we will void the certificate only with respect to the number of 
engines needed to reach the amount of the net deficit. For example, if 
the original engine family generated 500 Mg of negative credits, and 
the manufacturer's net deficit after three years was 250 Mg, we would 
void the certificate with respect to half of the engines in the family.
    (f) For purposes of calculating the statute of limitations, the 
following actions are all considered to occur at the expiration of the 
deadline for offsetting a deficit as specified in paragraph (a) of this 
section:
    (1) Failing to meet the requirements of paragraph (a) of this 
section.
    (2) Failing to satisfy the conditions upon which a certificate was 
issued relative to offsetting a deficit.
    (3) Selling, offering for sale, introducing or delivering into U.S. 
commerce, or importing vehicles that are found not to be covered by a 
certificate as a result of failing to offset a deficit.


Sec.  1036.750  What can happen if I do not comply with the provisions 
of this subpart?

    (a) For each engine family participating in the ABT program, the 
certificate of conformity is conditioned upon full compliance with the 
provisions of this subpart during and after the model year. You are 
responsible to establish to our satisfaction that you fully comply with 
applicable requirements. We may void the certificate of conformity for 
an engine family if you fail to comply with any provisions of this 
subpart.
    (b) You may certify your engine family to an FCL above an 
applicable standard based on a projection that you

[[Page 74041]]

will have enough emission credits to offset the deficit for the engine 
family. See Sec.  1036.745 for provisions specifying what happens if 
you cannot show in your final report that you have enough actual 
emission credits to offset a deficit for any pollutant in an engine 
family.
    (c) We may void the certificate of conformity for an engine family 
if you fail to keep records, send reports, or give us information we 
request. Note that failing to keep records, send reports, or give us 
information we request is also a violation of 42 U.S.C. 7522(a)(2).
    (d) You may ask for a hearing if we void your certificate under 
this section (see Sec.  1036.820).


Sec.  1036.755  Information provided to the Department of 
Transportation.

    After receipt of each manufacturer's final report as specified in 
Sec.  1036.730 and completion of any verification testing required to 
validate the manufacturer's submitted final data, we will issue a 
report to the Department of Transportation with CO2 emission 
information and will verify the accuracy of each manufacturer's 
equivalent fuel consumption data that required by NHTSA under 49 CFR 
535.8. We will send a report to DOT for each engine manufacturer based 
on each regulatory category and subcategory, including sufficient 
information for NHTSA to determine fuel consumption and associated 
credit values. See 49 CFR 535.8 to determine if NHTSA deems submission 
of this information to EPA to also be a submission to NHTSA.

Subpart I--Definitions and Other Reference Information


Sec.  1036.801  Definitions.

    The following definitions apply to this part. The definitions apply 
to all subparts unless we note otherwise. All undefined terms have the 
meaning the Act gives to them. The definitions follow:
    Act means the Clean Air Act, as amended, 42 U.S.C. 7401--7671q.
    Adjustable parameter has the meaning given in 40 CFR part 86.
    Advanced technology means technology certified under 40 CFR 
86.1819-14(k)(7), Sec.  1036.615, or 40 CFR 1037.615.
    Aftertreatment means relating to a catalytic converter, particulate 
filter, or any other system, component, or technology mounted 
downstream of the exhaust valve (or exhaust port) whose design function 
is to decrease emissions in the engine exhaust before it is exhausted 
to the environment. Exhaust gas recirculation (EGR) and turbochargers 
are not aftertreatment.
    Aircraft means any vehicle capable of sustained air travel more 
than 100 feet above the ground.
    Alcohol-fueled engine mean an engine that is designed to run using 
an alcohol fuel. For purposes of this definition, alcohol fuels do not 
include fuels with a nominal alcohol content below 25 percent by 
volume.
    Auxiliary emission control device means any element of design that 
senses temperature, motive speed, engine rpm, transmission gear, or any 
other parameter for the purpose of activating, modulating, delaying, or 
deactivating the operation of any part of the emission control system.
    Averaging set has the meaning given in Sec.  1036.740.
    Calibration means the set of specifications and tolerances specific 
to a particular design, version, or application of a component or 
assembly capable of functionally describing its operation over its 
working range.
    Carryover means relating to certification based on emission data 
generated from an earlier model year as described in Sec.  1036.235(d).
    Certification means relating to the process of obtaining a 
certificate of conformity for an engine family that complies with the 
emission standards and requirements in this part.
    Certified emission level means the highest deteriorated emission 
level in an engine family for a given pollutant from the applicable 
transient and/or steady-state testing, rounded to the same number of 
decimal places as the applicable standard. Note that you may have two 
certified emission levels for CO2 if you certify a family 
for both vocational and tractor use.
    Complete vehicle means a vehicle meeting the definition of complete 
vehicle in 40 CFR 1037.801 when it is first sold as a vehicle. For 
example, where a vehicle manufacturer sells an incomplete vehicle to a 
secondary vehicle manufacturer, the vehicle is not a complete vehicle 
under this part, even after its final assembly.
    Compression-ignition means relating to a type of reciprocating, 
internal-combustion engine that is not a spark-ignition engine. Note 
that Sec.  1036.1 also deems gas turbine engines and other engines to 
be compression-ignition engines.
    Crankcase emissions means airborne substances emitted to the 
atmosphere from any part of the engine crankcase's ventilation or 
lubrication systems. The crankcase is the housing for the crankshaft 
and other related internal parts.
    Criteria pollutants means emissions of NOX, HC, PM, and 
CO. Note that these pollutants are also sometimes described 
collectively as ``non-greenhouse gas pollutants'', although they do not 
necessarily have negligible global warming potentials.
    Designated Compliance Officer means one of the following:
    (1) For engines subject to compression-ignition standards, 
Designated Compliance Officer means Director, Diesel Engine Compliance 
Center, U.S. Environmental Protection Agency, 2000 Traverwood Drive, 
Ann Arbor, MI 48105; [email protected]; epa.gov/otaq/verify.
    (2) For engines subject to spark-ignition standards, Designated 
Compliance Officer means Director, Gasoline Engine Compliance Center, 
U.S. Environmental Protection Agency, 2000 Traverwood Drive, Ann Arbor, 
MI 48105; [email protected]; epa.gov/otaq/verify.
    Deteriorated emission level means the emission level that results 
from applying the appropriate deterioration factor to the official 
emission result of the emission-data engine. Note that where no 
deterioration factor applies, references in this part to the 
deteriorated emission level mean the official emission result.
    Deterioration factor means the relationship between emissions at 
the end of useful life (or point of highest emissions if it occurs 
before the end of useful life) and emissions at the low-hour/low-
mileage test point, expressed in one of the following ways:
    (1) For multiplicative deterioration factors, the ratio of 
emissions at the end of useful life (or point of highest emissions) to 
emissions at the low-hour test point.
    (2) For additive deterioration factors, the difference between 
emissions at the end of useful life (or point of highest emissions) and 
emissions at the low-hour test point.
    Diesel exhaust fluid (DEF) means a liquid reducing agent (other 
than the engine fuel) used in conjunction with selective catalytic 
reduction to reduce NOX emissions. Diesel exhaust fluid is 
generally understood to be an aqueous solution of urea conforming to 
the specifications of ISO 22241.
    Dual-fuel means relating to an engine designed for operation on two 
different types of fuel but not on a continuous mixture of those fuels 
(see Sec.  1036.601(d)). For purposes of this part, such an engine 
remains a dual-fuel engine even if it is designed for operation on 
three or more different fuels.
    Emission control system means any device, system, or element of 
design that

[[Page 74042]]

controls or reduces the emissions of regulated pollutants from an 
engine.
    Emission-data engine means an engine that is tested for 
certification. This includes engines tested to establish deterioration 
factors.
    Emission-related maintenance means maintenance that substantially 
affects emissions or is likely to substantially affect emission 
deterioration.
    Engine configuration means a unique combination of engine hardware 
and calibration (related to the emission standards) within an engine 
family. Engines within a single engine configuration differ only with 
respect to normal production variability or factors unrelated to 
compliance with emission standards.
    Engine family has the meaning given in Sec.  1036.230.
    Excluded means relating to engines that are not subject to some or 
all of the requirements of this part as follows:
    (1) An engine that has been determined not to be a heavy-duty 
engine is excluded from this part.
    (2) Certain heavy-duty engines are excluded from the requirements 
of this part under Sec.  1036.5.
    (3) Specific regulatory provisions of this part may exclude a 
heavy-duty engine generally subject to this part from one or more 
specific standards or requirements of this part.
    Exempted has the meaning given in 40 CFR 1068.30.
    Exhaust gas recirculation means a technology that reduces emissions 
by routing exhaust gases that had been exhausted from the combustion 
chamber(s) back into the engine to be mixed with incoming air before or 
during combustion. The use of valve timing to increase the amount of 
residual exhaust gas in the combustion chamber(s) that is mixed with 
incoming air before or during combustion is not considered exhaust gas 
recirculation for the purposes of this part.
    Family certification level (FCL) means a CO2 emission 
level declared by the manufacturer that is at or above emission test 
results for all emission-data engines. The FCL serves as the emission 
standard for the engine family with respect to certification testing if 
it is different than the otherwise applicable standard. The FCL must be 
expressed to the same number of decimal places as the emission standard 
it replaces.
    Family emission limit (FEL) means an emission level declared by the 
manufacturer to serve in place of an otherwise applicable emission 
standard (other than CO2 standards) under the ABT program in 
subpart H of this part. The FEL must be expressed to the same number of 
decimal places as the emission standard it replaces. The FEL serves as 
the emission standard for the engine family with respect to all 
required testing except certification testing for CO2. The 
CO2 FEL is equal to the CO2 FCL multiplied by 
1.03 and rounded to the same number of decimal places as the standard 
(e.g., the nearest whole g/hp-hr for the 2016 CO2 
standards).
    Flexible-fuel means relating to an engine designed for operation on 
any mixture of two or more different types of fuels (see Sec.  
1036.601(d)).
    Fuel type means a general category of fuels such as diesel fuel, 
gasoline, or natural gas. There can be multiple grades within a single 
fuel type, such as premium gasoline, regular gasoline, or gasoline with 
10 percent ethanol.
    Good engineering judgment has the meaning given in 40 CFR 1068.30. 
See 40 CFR 1068.5 for the administrative process we use to evaluate 
good engineering judgment.
    Greenhouse gas means one or more compounds regulated under this 
part based primarily on their impact on the climate. This generally 
includes CO2, CH4, and N2O.
    Greenhouse gas Emissions Model (GEM) means the GEM simulation tool 
described in 40 CFR 1037.520. Note that an updated version of GEM 
applies starting in model year 2021.
    Gross vehicle weight rating (GVWR) means the value specified by the 
vehicle manufacturer as the maximum design loaded weight of a single 
vehicle, consistent with good engineering judgment.
    Heavy-duty engine means any engine which the engine manufacturer 
could reasonably expect to be used for motive power in a heavy-duty 
vehicle. For purposes of this definition in this part, the term 
``engine'' includes internal combustion engines and other devices that 
convert chemical fuel into motive power. For example, a fuel cell or a 
gas turbine used in a heavy-duty vehicle is a heavy-duty engine.
    Heavy-duty vehicle means any motor vehicle above 8,500 pounds GVWR 
or that has a vehicle curb weight above 6,000 pounds or that has a 
basic vehicle frontal area greater than 45 square feet. Curb weight and 
Basic vehicle frontal area have the meaning given in 40 CFR 86.1803.
    Hybrid means relating to an engine or powertrain that includes 
energy storage features other than a conventional battery system or 
conventional flywheel. Supplemental electrical batteries and hydraulic 
accumulators are examples of hybrid energy storage systems. Note that 
certain provisions in this part treat hybrid engines and powertrains 
intended for vehicles that include regenerative braking different than 
those intended for vehicles that do not include regenerative braking.
    Hydrocarbon (HC) means the hydrocarbon group on which the emission 
standards are based for each fuel type. For alcohol-fueled engines, HC 
means nonmethane hydrocarbon equivalent (NMHCE). For all other engines, 
HC means nonmethane hydrocarbon (NMHC).
    Identification number means a unique specification (for example, a 
model number/serial number combination) that allows someone to 
distinguish a particular engine from other similar engines.
    Incomplete vehicle means a vehicle meeting the definition of 
incomplete vehicle in 40 CFR 1037.801 when it is first sold (or 
otherwise delivered to another entity) as a vehicle.
    Innovative technology means technology certified under Sec.  
1036.610 (also described as ``off-cycle technology'').
    Liquefied petroleum gas (LPG) means a liquid hydrocarbon fuel that 
is stored under pressure and is composed primarily of nonmethane 
compounds that are gases at atmospheric conditions. Note that, although 
this commercial term includes the word ``petroleum'', LPG is not 
considered to be a petroleum fuel under the definitions of this 
section.
    Low-hour means relating to an engine that has stabilized emissions 
and represents the undeteriorated emission level. This would generally 
involve less than 125 hours of operation.
    Manufacture means the physical and engineering process of 
designing, constructing, and/or assembling a heavy-duty engine or a 
heavy-duty vehicle.
    Manufacturer has the meaning given in section 216(1) of the Act. In 
general, this term includes any person who manufactures or assembles an 
engine, vehicle, or piece of equipment for sale in the United States or 
otherwise introduces a new engine into commerce in the United States. 
This includes importers who import engines or vehicles for resale.
    Medium-duty passenger vehicle has the meaning given in 40 CFR 
86.1803.
    Model year means the manufacturer's annual new model production 
period, except as restricted under this definition. It must include 
January 1 of the calendar year for which the model year is named, may 
not begin before January 2 of the previous calendar year, and it must 
end by December 31 of the named calendar year. Manufacturers

[[Page 74043]]

may not adjust model years to circumvent or delay compliance with 
emission standards or to avoid the obligation to certify annually.
    Motor vehicle has the meaning given in 40 CFR 85.1703.
    Natural gas means a fuel whose primary constituent is methane.
    New motor vehicle engine has the meaning given in the Act. This 
generally means a motor vehicle engine meeting the criteria of either 
paragraph (1), (2), or (3) of this definition.
    (1) A motor vehicle engine for which the ultimate purchaser has 
never received the equitable or legal title is a new motor vehicle 
engine. This kind of engine might commonly be thought of as ``brand 
new'' although a new motor vehicle engine may include previously used 
parts. Under this definition, the engine is new from the time it is 
produced until the ultimate purchaser receives the title or places it 
into service, whichever comes first.
    (2) An imported motor vehicle engine is a new motor vehicle engine 
if it was originally built on or after January 1, 1970.
    (3) Any motor vehicle engine installed in a new motor vehicle.
    Noncompliant engine means an engine that was originally covered by 
a certificate of conformity, but is not in the certified configuration 
or otherwise does not comply with the conditions of the certificate.
    Nonconforming engine means an engine not covered by a certificate 
of conformity that would otherwise be subject to emission standards.
    Nonmethane hydrocarbon (NMHC) means the sum of all hydrocarbon 
species except methane, as measured according to 40 CFR part 1065.
    Nonmethane hydrocarbon equivalent (NMHCE) has the meaning given in 
40 CFR 1065.1001.
    Off-cycle technology means technology certified under Sec.  
1036.610 (also described as ``innovative technology'').
    Official emission result means the measured emission rate for an 
emission-data engine on a given duty cycle before the application of 
any deterioration factor, but after the applicability of any required 
regeneration or other adjustment factors.
    Owners manual means a document or collection of documents prepared 
by the engine or vehicle manufacturer for the owner or operator to 
describe appropriate engine maintenance, applicable warranties, and any 
other information related to operating or keeping the engine. The 
owners manual is typically provided to the ultimate purchaser at the 
time of sale. The owners manual may be in paper or electronic format.
    Oxides of nitrogen has the meaning given in 40 CFR 1065.1001.
    Percent has the meaning given in 40 CFR 1065.1001. Note that this 
means percentages identified in this part are assumed to be infinitely 
precise without regard to the number of significant figures. For 
example, one percent of 1,493 is 14.93.
    Placed into service means put into initial use for its intended 
purpose, excluding incidental use by the manufacturer or a dealer.
    Preliminary approval means approval granted by an authorized EPA 
representative prior to submission of an application for certification, 
consistent with the provisions of Sec.  1036.210.
    Primary intended service class has the meaning given in Sec.  
1036.140.
    Rechargeable Energy Storage System (RESS) means the component(s) of 
a hybrid engine or vehicle that store recovered energy for later use, 
such as the battery system in an electric hybrid vehicle.
    Relating to as used in this section means relating to something in 
a specific, direct manner. This expression is used in this section only 
to define terms as adjectives and not to broaden the meaning of the 
terms.
    Revoke has the meaning given in 40 CFR 1068.30.
    Round has the meaning given in 40 CFR 1065.1001.
    Scheduled maintenance means adjusting, repairing, removing, 
disassembling, cleaning, or replacing components or systems 
periodically to keep a part or system from failing, malfunctioning, or 
wearing prematurely. It also may mean actions you expect are necessary 
to correct an overt indication of failure or malfunction for which 
periodic maintenance is not appropriate.
    Small manufacturer means a manufacturer meeting the criteria 
specified in 13 CFR 121.201. The employee and revenue limits apply to 
the total number of employees and total revenue together for affiliated 
companies. Note that manufacturers with low production volumes may or 
may not be ``small manufacturers''.
    Spark-ignition means relating to a gasoline-fueled engine or any 
other type of engine with a spark plug (or other sparking device) and 
with operating characteristics significantly similar to the theoretical 
Otto combustion cycle. Spark-ignition engines usually use a throttle to 
regulate intake air flow to control power during normal operation.
    Steady-state has the meaning given in 40 CFR 1065.1001.
    Suspend has the meaning given in 40 CFR 1068.30.
    Test engine means an engine in a test sample.
    Test sample means the collection of engines selected from the 
population of an engine family for emission testing. This may include 
testing for certification, production-line testing, or in-use testing.
    Tractor means a vehicle meeting the definition of ``tractor'' in 40 
CFR 1037.801, but not classified as a ``vocational tractor'' under 40 
CFR 1037.630, or relating to such a vehicle.
    Tractor engine means an engine certified for use in tractors. Where 
an engine family is certified for use in both tractors and vocational 
vehicles, ``tractor engine'' means an engine that the engine 
manufacturer reasonably believes will be (or has been) installed in a 
tractor. Note that the provisions of this part may require a 
manufacturer to document how it determines that an engine is a tractor 
engine.
    Ultimate purchaser means, with respect to any new engine or 
vehicle, the first person who in good faith purchases such new engine 
or vehicle for purposes other than resale.
    United States has the meaning given in 40 CFR 1068.30.
    Upcoming model year means for an engine family the model year after 
the one currently in production.
    U.S.-directed production volume means the number of engines, 
subject to the requirements of this part, produced by a manufacturer 
for which the manufacturer has a reasonable assurance that sale was or 
will be made to ultimate purchasers in the United States. This does not 
include engines certified to state emission standards that are 
different than the emission standards in this part.
    Vehicle has the meaning given in 40 CFR 1037.801.
    Vocational engine means an engine certified for use in vocational 
vehicles. Where an engine family is certified for use in both tractors 
and vocational vehicles, ``vocational engine'' means an engine that the 
engine manufacturer reasonably believes will be (or has been) installed 
in a vocational vehicle. Note that the provisions of this part may 
require a manufacturer to document how it determines that an engine is 
a vocational engine.
    Vocational vehicle means a vehicle meeting the definition of 
``vocational'' vehicle in 40 CFR 1037.801.
    Void has the meaning given in 40 CFR 1068.30.
    We (us, our) means the Administrator of the Environmental 
Protection Agency and any authorized representatives.

[[Page 74044]]

Sec.  1036.805  Symbols, abbreviations, and acronyms.

    The procedures in this part generally follow either the 
International System of Units (SI) or the United States customary 
units, as detailed in NIST Special Publication 811 (incorporated by 
reference in Sec.  1036.810). See 40 CFR 1065.20 for specific 
provisions related to these conventions. This section summarizes the 
way we use symbols, units of measure, and other abbreviations.
    (a) Symbols for chemical species. This part uses the following 
symbols for chemical species and exhaust constituents:

------------------------------------------------------------------------
                  Symbol                               Species
------------------------------------------------------------------------
C.........................................  carbon.
CH4.......................................  methane.
CH4N2O....................................  urea.
CO........................................  carbon monoxide.
CO2.......................................  carbon dioxide.
H2O.......................................  water.
HC........................................  hydrocarbon.
NMHC......................................  nonmethane hydrocarbon.
NMHCE.....................................  nonmethane hydrocarbon
                                             equivalent.
NO........................................  nitric oxide.
NO2.......................................  nitrogen dioxide.
NOX.......................................  oxides of nitrogen.
N2O.......................................  nitrous oxide.
PM........................................  particulate matter.
------------------------------------------------------------------------

    (b) Symbols for quantities. This part uses the following symbols 
and units of measure for various quantities:

----------------------------------------------------------------------------------------------------------------
     Symbol             Quantity               Unit             Unit  symbol      Unit in terms of SI base units
----------------------------------------------------------------------------------------------------------------
[alpha].........  atomic hydrogen-to-  mole per mole......  mol/mol............  1.
                   carbon ratio.
[beta]..........  atomic oxygen-to-    mole per mole......  mol/mol............  1.
                   carbon ratio.
CdA.............  drag area..........  meter squared......  m\2\...............  m\2\.
Crr.............  coefficient of       kilogram per metric  kg/tonne...........  10-3.
                   rolling resistance.  ton.
D...............  distance...........  miles or meters....  mi or m............  m.
e...............  mass weighted        grams/ton-mile.....  g/ton-mi...........  g/kg-km.
                   emission result.
Eff.............  efficiency.........  ...................  ...................  ...............................
Em..............  mass-specific net    megajoules/kilogram  MJ/kg..............  m\2\[Cdot]s-2.
                   energy content.
fn..............  angular speed        revolutions per      r/min..............  [pi][Cdot]30[middot]s-1.
                   (shaft).             minute.
i...............  indexing variable..  ...................  ...................  ...............................
ka..............  drive axle ratio...  ...................  ...................  ...............................
ktopgear........  highest available    ...................  ...................  ...............................
                   transmission gear.
m...............  mass...............  pound mass or        lbm or kg..........  kg.
                                        kilogram.
M...............  molar mass.........  gram per mole......  g/mol..............  10-3[Cdot]kg[Cdot]mol-1.
M...............  vehicle mass.......  kilogram...........  kg.................  kg.
Mrotating.......  inertial mass of     kilogram...........  kg.................  kg.
                   rotating
                   components.
N...............  total number in a    ...................  ...................  ...............................
                   series.
P...............  power..............  kilowatt...........  kW.................  10\3\[Cdot]m\2\[Cdot]kg[Cdot]s-
                                                                                  3.
T...............  torque (moment of    newton meter.......  N[Cdot]m...........  m\2\[Cdot]kg[Cdot]s-2.
                   force).
t...............  time...............  second.............  s..................  s.
[Delta]t........  time interval,       second.............  s..................  s.
                   period, 1/
                   frequency.
UF..............  utility factor.....  ...................  ...................  ...............................
v...............  speed..............  miles per hour or    mi/hr or m/s.......  m[Cdot]s-1.
                                        meters persecond.
W...............  work...............  kilowatt-hour......  kW[Cdot]hr.........  3.6[Cdot]m\2\[Cdot]kg[Cdot]s-1.
wC..............  carbon mass          gram/gram..........  g/g................  1.
                   fraction.
wCH4N2O.........  urea mass fraction.  gram/gram..........  g/g................  1.
x...............  amount of substance  mole per mole......  mol/mol............  1.
                   mole fraction.
xb..............  brake energy         ...................  ...................  ...............................
                   fraction.
xbl.............  brake energy limit.  ...................  ...................  ...............................
----------------------------------------------------------------------------------------------------------------

    (c) Superscripts. This part uses the following superscripts to 
define a quantity:

------------------------------------------------------------------------
                Superscript                           Quantity
------------------------------------------------------------------------
overbar (such as y).......................  arithmetic mean.
overdot overdot (such as y)...............  quantity per unit time.
------------------------------------------------------------------------

    (d) Subscripts. This part uses the following subscripts to define a 
quantity:

------------------------------------------------------------------------
               Subscript                             Quantity
------------------------------------------------------------------------
65.....................................  65 miles per hour.
A......................................  A speed.
acc....................................  accessory.
app....................................  approved.
axle...................................  axle.
B......................................  B speed.
C......................................  C speed.
Ccombdry...............................  carbon from fuel per mole of
                                          dry exhaust.
CD.....................................  charge-depleting.
CO2DEF.................................  CO2 resulting from diesel
                                          exhaust fluid decomposition.
comb...................................  combustion.
cor....................................  corrected.
CS.....................................  charge-sustaining.
cycle..................................  test cycle.
DEF....................................  diesel exhaust fluid.
engine.................................  engine.
exh....................................  raw exhaust.
fuel...................................  fuel.
H2Oexhaustdry..........................  H2O in exhaust per mole of
                                          exhaust.
hi.....................................  high.
i......................................  an individual of a series.
idle...................................  idle.
m......................................  mass.
max....................................  maximum.
mapped.................................  mapped.
meas...................................  measured quantity.
neg....................................  negative.
pos....................................  positive.
record.................................  record.
ref....................................  reference quantity.
speed..................................  speed.
stall..................................  stall.
test...................................  test.
tire...................................  tire.
transient..............................  transient.
vehicle................................  vehicle.
------------------------------------------------------------------------

    (e) Other acronyms and abbreviations. This part uses the following 
additional abbreviations and acronyms:

ABT averaging, banking, and trading
AECD auxiliary emission control device
ASTM American Society for Testing and Materials
BTU British thermal units

[[Page 74045]]

CD charge-depleting
CFR Code of Federal Regulations
CI compression ignition
CS charge-sustaining
DF deterioration factor
DOT Department of Transportation
E85 gasoline blend including nominally 85 percent denatured ethanol
EPA Environmental Protection Agency
FCL Family Certification Level
FEL Family Emission Limit
GEM Greenhouse gas Emissions Model
g/hp-hr grams per brake horsepower-hour
GVWR gross vehicle weight rating
LPG liquefied petroleum gas
NARA National Archives and Records Administration
NHTSA National Highway Traffic Safety Administration
NTE not-to-exceed
RESS rechargeable energy storage system
RMC ramped-modal cycle
rpm revolutions per minute
SCR Selective catalytic reduction
SI spark ignition
U.S. United States
U.S.C. United States Code

    (f) Prefixes. This part uses the following prefixes to define a 
quantity:

------------------------------------------------------------------------
               Symbol                       Quantity            Value
------------------------------------------------------------------------
[micro]............................  micro.................         10-6
m..................................  milli.................         10-3
c..................................  centi.................         10-2
k..................................  kilo..................        10\3\
M..................................  mega..................        10\6\
------------------------------------------------------------------------

Sec.  1036.810  Incorporation by reference.

    (a) Certain material is incorporated by reference into this part 
with the approval of the Director of the Federal Register under 5 
U.S.C. 552(a) and 1 CFR part 51. To enforce any edition other than that 
specified in this section, the Environmental Protection Agency must 
publish a document in the Federal Register and the material must be 
available to the public. All approved material is available for 
inspection at U.S. EPA, Air and Radiation Docket and Information 
Center, 1301 Constitution Ave., NW., Room B102, EPA West Building, 
Washington, DC 20460, (202) 202-1744, and is available from the sources 
listed below. It is also available for inspection at the National 
Archives and Records Administration (NARA). For information on the 
availability of this material at NARA, call 202-741-6030, or go to 
http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.
    (b) American Society for Testing and Materials, 100 Barr Harbor 
Drive, P.O. Box C700, West Conshohocken, PA, 19428-2959, (877) 909-
2786, http://www.astm.org/.
    (1) ASTM D4809-13 Standard Test Method for Heat of Combustion of 
Liquid Hydrocarbon Fuels by Bomb Calorimeter (Precision Method), 
approved May 1, 2013, (``ASTM D4809''), IBR approved for Sec.  
1036.530(b).
    (2) [Reserved]
    (c) National Institute of Standards and Technology, 100 Bureau 
Drive, Stop 1070, Gaithersburg, MD 20899-1070, (301) 975-6478, or 
www.nist.gov.
    (1) NIST Special Publication 811, Guide for the Use of the 
International System of Units (SI), 2008 Edition, March 2008, IBR 
approved for Sec.  1036.805.
    (2) [Reserved]


Sec.  1036.815  Confidential information.

    The provisions of 40 CFR 1068.10 apply for information you consider 
confidential.


Sec.  1036.820  Requesting a hearing.

    (a) You may request a hearing under certain circumstances, as 
described elsewhere in this part. To do this, you must file a written 
request, including a description of your objection and any supporting 
data, within 30 days after we make a decision.
    (b) For a hearing you request under the provisions of this part, we 
will approve your request if we find that your request raises a 
substantial factual issue.
    (c) If we agree to hold a hearing, we will use the procedures 
specified in 40 CFR part 1068, subpart G.


Sec.  1036.825  Reporting and recordkeeping requirements.

    (a) This part includes various requirements to submit and record 
data or other information. Unless we specify otherwise, store required 
records in any format and on any media and keep them readily available 
for eight years after you send an associated application for 
certification, or eight years after you generate the data if they do 
not support an application for certification. You are expected to keep 
your own copy of required records rather than relying on someone else 
to keep records on your behalf. We may review these records at any 
time. You must promptly send us organized, written records in English 
if we ask for them. We may require you to submit written records in an 
electronic format.
    (b) The regulations in Sec.  1036.255 and 40 CFR 1068.25 and 
1068.101 describe your obligation to report truthful and complete 
information. This includes information not related to certification. 
Failing to properly report information and keep the records we specify 
violates 40 CFR 1068.101(a)(2), which may involve civil or criminal 
penalties.
    (c) Send all reports and requests for approval to the Designated 
Compliance Officer (see Sec.  1036.801).
    (d) Any written information we require you to send to or receive 
from another company is deemed to be a required record under this 
section. Such records are also deemed to be submissions to EPA. Keep 
these records for eight years unless the regulations specify a 
different period. We may require you to send us these records whether 
or not you are a certificate holder.
    (e) Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.), the 
Office of Management and Budget approves the reporting and 
recordkeeping specified in the applicable regulations. The following 
items illustrate the kind of reporting and recordkeeping we require for 
engines and vehicles regulated under this part:
    (1) We specify the following requirements related to engine 
certification in this part 1036:
    (i) In Sec.  1036.135 we require engine manufacturers to keep 
certain records related to duplicate labels sent to vehicle 
manufacturers.
    (ii) In Sec.  1036.150 we include various reporting and 
recordkeeping requirements related to interim provisions.
    (iii) In subpart C of this part we identify a wide range of 
information required to certify engines.
    (iv) In subpart G of this part we identify several reporting and 
recordkeeping items for making demonstrations and getting approval 
related to various special compliance provisions.
    (v) In Sec. Sec.  1036.725, 1036.730, and 1036.735 we specify 
certain records related to averaging, banking, and trading.
    (2) We specify the following requirements related to testing in 40 
CFR part 1065:
    (i) In 40 CFR 1065.2 we give an overview of principles for 
reporting information.
    (ii) In 40 CFR 1065.10 and 1065.12 we specify information needs for 
establishing various changes to published test procedures.
    (iii) In 40 CFR 1065.25 we establish basic guidelines for storing 
test information.
    (iv) In 40 CFR 1065.695 we identify the specific information and 
data items to record when measuring emissions.
    (3) We specify the following requirements related to the general

[[Page 74046]]

compliance provisions in 40 CFR part 1068:
    (i) In 40 CFR 1068.5 we establish a process for evaluating good 
engineering judgment related to testing and certification.
    (ii) In 40 CFR 1068.25 we describe general provisions related to 
sending and keeping information
    (iii) In 40 CFR 1068.27 we require manufacturers to make engines 
available for our testing or inspection if we make such a request.
    (iv) In 40 CFR 1068.105 we require vehicle manufacturers to keep 
certain records related to duplicate labels from engine manufacturers.
    (v) In 40 CFR 1068.120 we specify recordkeeping related to 
rebuilding engines.
    (vi) In 40 CFR part 1068, subpart C, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to various exemptions.
    (vii) In 40 CFR part 1068, subpart D, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to importing engines.
    (viii) In 40 CFR 1068.450 and 1068.455 we specify certain records 
related to testing production-line engines in a selective enforcement 
audit.
    (ix) In 40 CFR 1068.501 we specify certain records related to 
investigating and reporting emission-related defects.
    (x) In 40 CFR 1068.525 and 1068.530 we specify certain records 
related to recalling nonconforming engines.
    (xi) In 40 CFR part 1068, subpart G, we specify certain records for 
requesting a hearing.

Appendix I to Part 1036 -- Default Engine Fuel Maps for Sec.  1036.540

    This appendix includes default steady-state fuel maps for 
performing cycle-average engine fuel mapping as described in 
Sec. Sec.  1036.535 and 1036.540.
    (a) Use the following default fuel map for compression-ignition 
engines that will be installed in Tractors and Vocational Heavy HDV:

------------------------------------------------------------------------
                                                  Engine      Fuel mass
            Engine speed  (r/min)                 torque      rate  (g/
                                               (N[middot]m)      sec)
------------------------------------------------------------------------
666.7........................................             0        0.436
833.3........................................             0        0.665
1000.........................................             0         0.94
1166.7.......................................             0        1.002
1333.3.......................................             0         1.17
1500.........................................             0          1.5
1666.7.......................................             0        1.899
1833.3.......................................             0        2.378
2000.........................................             0         2.93
2166.7.......................................             0        3.516
2333.3.......................................             0        4.093
2500.........................................             0        4.672
500..........................................           300        0.974
666.7........................................           300        1.405
833.3........................................           300        1.873
1000.........................................           300        2.324
1166.7.......................................           300        2.598
1333.3.......................................           300        2.904
1500.........................................           300        3.397
1666.7.......................................           300        3.994
1833.3.......................................           300        4.643
2000.........................................           300        5.372
2166.7.......................................           300        6.141
2333.3.......................................           300        7.553
2500.........................................           300        8.449
500..........................................           600        1.723
666.7........................................           600        2.391
833.3........................................           600        3.121
1000.........................................           600        3.756
1166.7.......................................           600        4.197
1333.3.......................................           600        4.776
1500.........................................           600        5.492
1666.7.......................................           600        6.277
1833.3.......................................           600        7.129
2000.........................................           600        8.069
2166.7.......................................           600        9.745
2333.3.......................................           600       11.213
2500.........................................           600        12.59
500..........................................           900        2.637
666.7........................................           900        3.444
833.3........................................           900        4.243
1000.........................................           900        4.997
1166.7.......................................           900        5.802
1333.3.......................................           900        6.702
1500.........................................           900        7.676
1666.7.......................................           900          8.7
1833.3.......................................           900        9.821
2000.........................................           900        11.08
2166.7.......................................           900       13.051
2333.3.......................................           900       15.002
2500.........................................           900       16.862
500..........................................          1200        3.833
666.7........................................          1200        4.679
833.3........................................          1200        5.535
1000.........................................          1200        6.519
1166.7.......................................          1200        7.603
1333.3.......................................          1200        8.735
1500.........................................          1200        9.948
1666.7.......................................          1200       11.226
1833.3.......................................          1200       12.622
2000.........................................          1200       14.228
2166.7.......................................          1200       16.488
2333.3.......................................          1200       18.921
2500.........................................          1200       21.263
500..........................................          1500        6.299
666.7........................................          1500        6.768
833.3........................................          1500         6.95
1000.........................................          1500        8.096
1166.7.......................................          1500        9.399
1333.3.......................................          1500       10.764
1500.........................................          1500       12.238
1666.7.......................................          1500       13.827
1833.3.......................................          1500       15.586
2000.........................................          1500       17.589
2166.7.......................................          1500       20.493
2333.3.......................................          1500       23.366
2500.........................................          1500       26.055
500..........................................          1800        9.413
666.7........................................          1800        9.551
833.3........................................          1800        8.926
1000.........................................          1800        9.745
1166.7.......................................          1800        11.26
1333.3.......................................          1800       12.819
1500.........................................          1800       14.547
1666.7.......................................          1800       16.485
1833.3.......................................          1800       18.697
2000.........................................          1800       21.535
2166.7.......................................          1800       24.981
2333.3.......................................          1800       28.404
2500.........................................          1800       31.768
500..........................................          2100       13.128
666.7........................................          2100       12.936
833.3........................................          2100       12.325
1000.........................................          2100       11.421
1166.7.......................................          2100       13.174
1333.3.......................................          2100       14.969
1500.........................................          2100       16.971
1666.7.......................................          2100       19.274
1833.3.......................................          2100        22.09
2000.........................................          2100       25.654
2166.7.......................................          2100       29.399
2333.3.......................................          2100       32.958
2500.........................................          2100       36.543
500..........................................          2400       17.446
666.7........................................          2400       16.922
833.3........................................          2400       15.981
1000.........................................          2400       14.622
1166.7.......................................          2400       15.079
1333.3.......................................          2400       17.165
1500.........................................          2400       19.583
1666.7.......................................          2400       22.408
1833.3.......................................          2400       25.635
2000.........................................          2400        29.22
2166.7.......................................          2400       33.168
2333.3.......................................          2400       37.233
2500.........................................          2400       41.075
500..........................................          2700       22.365
666.7........................................          2700       21.511
833.3........................................          2700       20.225
1000.........................................          2700       17.549
1166.7.......................................          2700       17.131
1333.3.......................................          2700       19.588
1500.........................................          2700       22.514
1666.7.......................................          2700       25.574
1833.3.......................................          2700       28.909
2000.........................................          2700       32.407
2166.7.......................................          2700        36.18
2333.3.......................................          2700       40.454
2500.........................................          2700       44.968
500..........................................          3000       27.476
666.7........................................          3000       22.613
833.3........................................          3000       19.804
1000.........................................          3000       17.266
1166.7.......................................          3000       19.197
1333.3.......................................          3000       22.109
1500.........................................          3000       25.288
1666.7.......................................          3000        28.44
1833.3.......................................          3000       31.801
2000.........................................          3000       35.405
2166.7.......................................          3000       39.152
2333.3.......................................          3000       42.912
2500.........................................          3000       47.512
------------------------------------------------------------------------

    (b) Use the following default fuel map for compression-ignition 
engines that will be installed in Vocational Light HDV and Medium 
HDV:

------------------------------------------------------------------------
                                                  Engine      Fuel mass
            Engine speed  (r/min)                 torque      rate  (g/
                                               (N[middot]m)      sec)
------------------------------------------------------------------------
708.3........................................             0        0.255
916.7........................................             0        0.263
1125.........................................             0        0.342

[[Page 74047]]

 
1333.3.......................................             0        0.713
1541.7.......................................             0        0.885
1750.........................................             0        1.068
1958.3.......................................             0         1.27
2166.7.......................................             0        1.593
2375.........................................             0        1.822
2583.3.......................................             0        2.695
2791.7.......................................             0        4.016
3000.........................................             0        5.324
500..........................................           120        0.515
708.3........................................           120        0.722
916.7........................................           120        0.837
1125.........................................           120        1.097
1333.3.......................................           120        1.438
1541.7.......................................           120        1.676
1750.........................................           120        1.993
1958.3.......................................           120         2.35
2166.7.......................................           120        2.769
2375.........................................           120        3.306
2583.3.......................................           120        4.004
2791.7.......................................           120         4.78
3000.........................................           120        5.567
500..........................................           240        0.862
708.3........................................           240        1.158
916.7........................................           240        1.462
1125.........................................           240         1.85
1333.3.......................................           240        2.246
1541.7.......................................           240        2.603
1750.........................................           240        3.086
1958.3.......................................           240        3.516
2166.7.......................................           240        4.093
2375.........................................           240        4.726
2583.3.......................................           240        5.372
2791.7.......................................           240        6.064
3000.........................................           240        6.745
500..........................................           360        1.221
708.3........................................           360        1.651
916.7........................................           360        2.099
1125.........................................           360         2.62
1333.3.......................................           360        3.116
1541.7.......................................           360        3.604
1750.........................................           360        4.172
1958.3.......................................           360        4.754
2166.7.......................................           360        5.451
2375.........................................           360         6.16
2583.3.......................................           360        7.009
2791.7.......................................           360        8.007
3000.........................................           360        8.995
500..........................................           480        1.676
708.3........................................           480        2.194
916.7........................................           480         2.76
1125.........................................           480        3.408
1333.3.......................................           480        4.031
1541.7.......................................           480        4.649
1750.........................................           480        5.309
1958.3.......................................           480        6.052
2166.7.......................................           480        6.849
2375.........................................           480        7.681
2583.3.......................................           480        8.783
2791.7.......................................           480       10.073
3000.........................................           480        11.36
500..........................................           600        2.147
708.3........................................           600        2.787
916.7........................................           600        3.478
1125.........................................           600        4.227
1333.3.......................................           600        4.999
1541.7.......................................           600        5.737
1750.........................................           600        6.511
1958.3.......................................           600        7.357
2166.7.......................................           600        8.289
2375.........................................           600        9.295
2583.3.......................................           600       10.541
2791.7.......................................           600       11.914
3000.........................................           600       13.286
500..........................................           720        2.744
708.3........................................           720        3.535
916.7........................................           720        4.356
1125.........................................           720        5.102
1333.3.......................................           720        5.968
1541.7.......................................           720        6.826
1750.........................................           720        7.733
1958.3.......................................           720        8.703
2166.7.......................................           720        9.792
2375.........................................           720       10.984
2583.3.......................................           720       12.311
2791.7.......................................           720       13.697
3000.........................................           720       15.071
500..........................................           840        3.518
708.3........................................           840        4.338
916.7........................................           840        5.186
1125.........................................           840        6.063
1333.3.......................................           840        6.929
1541.7.......................................           840        7.883
1750.........................................           840         8.94
1958.3.......................................           840       10.093
2166.7.......................................           840       11.329
2375.........................................           840       12.613
2583.3.......................................           840       13.983
2791.7.......................................           840       15.419
3000.........................................           840       16.853
500..........................................           960        4.251
708.3........................................           960        5.098
916.7........................................           960        5.974
1125.........................................           960        6.917
1333.3.......................................           960        7.889
1541.7.......................................           960        8.913
1750.........................................           960       10.152
1958.3.......................................           960       11.482
2166.7.......................................           960        12.87
2375.........................................           960       14.195
2583.3.......................................           960       15.562
2791.7.......................................           960       16.995
3000.........................................           960       18.492
500..........................................          1080        4.978
708.3........................................          1080        5.928
916.7........................................          1080        6.877
1125.........................................          1080        7.827
1333.3.......................................          1080        8.838
1541.7.......................................          1080         9.91
1750.........................................          1080       11.347
1958.3.......................................          1080        12.85
2166.7.......................................          1080       14.398
2375.........................................          1080       15.745
2583.3.......................................          1080       17.051
2791.7.......................................          1080       18.477
3000.........................................          1080       19.971
500..........................................          1200        5.888
708.3........................................          1200        6.837
916.7........................................          1200        7.787
1125.........................................          1200        8.736
1333.3.......................................          1200        9.786
1541.7.......................................          1200       10.908
1750.........................................          1200       12.541
1958.3.......................................          1200       14.217
2166.7.......................................          1200       15.925
2375.........................................          1200         17.3
2583.3.......................................          1200       18.606
2791.7.......................................          1200       19.912
3000.........................................          1200       21.357
------------------------------------------------------------------------

    (c) Use the following default fuel map for all spark-ignition 
engines:

------------------------------------------------------------------------
                                                  Engine      Fuel mass
            Engine speed  (r/min)                 torque      rate  (g/
                                               (N[middot]m)      sec)
------------------------------------------------------------------------
875..........................................             0        0.535
1250.........................................             0        0.734
1625.........................................             0        0.975
2000.........................................             0        1.238
2375.........................................             0        1.506
2750.........................................             0        1.772
3125.........................................             0         2.07
3500.........................................             0        2.394
3875.........................................             0        2.795
4250.........................................             0        3.312
4625.........................................             0        3.349
5000.........................................             0        3.761
500..........................................            65        0.458
875..........................................            65        0.759
1250.........................................            65        1.065
1625.........................................            65         1.43
2000.........................................            65        1.812
2375.........................................            65         2.22
2750.........................................            65         2.65
3125.........................................            65        3.114
3500.........................................            65        3.646
3875.........................................            65        4.225
4250.........................................            65        4.861
4625.........................................            65        5.328
5000.........................................            65        6.028
500..........................................           130        0.666
875..........................................           130        1.063
1250.........................................           130        1.497
1625.........................................           130        1.976
2000.........................................           130        2.469
2375.........................................           130        3.015
2750.........................................           130         3.59
3125.........................................           130        4.218
3500.........................................           130          4.9
3875.........................................           130        5.652
4250.........................................           130        6.484
4625.........................................           130        7.308
5000.........................................           130        8.294
500..........................................           195        0.856
875..........................................           195        1.377
1250.........................................           195        1.923
1625.........................................           195        2.496
2000.........................................           195        3.111
2375.........................................           195        3.759
2750.........................................           195         4.49
3125.........................................           195        5.269
3500.........................................           195         6.13
3875.........................................           195        7.124
4250.........................................           195        8.189
4625.........................................           195        9.288
5000.........................................           195       10.561
500..........................................           260        1.079
875..........................................           260        1.716
1250.........................................           260        2.373
1625.........................................           260        3.083
2000.........................................           260        3.832
2375.........................................           260        4.599
2750.........................................           260        5.443
3125.........................................           260        6.391
3500.........................................           260        7.444
3875.........................................           260        8.564
4250.........................................           260        9.821
4625.........................................           260       11.268
5000.........................................           260       12.828
500..........................................           325        1.354
875..........................................           325         2.06
1250.........................................           325        2.844
1625.........................................           325        3.696
2000.........................................           325        4.579
2375.........................................           325        5.466
2750.........................................           325        6.434
3125.........................................           325        7.542

[[Page 74048]]

 
3500.........................................           325        8.685
3875.........................................           325        9.768
4250.........................................           325       11.011
4625.........................................           325       13.249
5000.........................................           325       15.095
500..........................................           390        1.609
875..........................................           390         2.44
1250.........................................           390        3.317
1625.........................................           390         4.31
2000.........................................           390        5.342
2375.........................................           390        6.362
2750.........................................           390        7.489
3125.........................................           390        8.716
3500.........................................           390        9.865
3875.........................................           390       10.957
4250.........................................           390       12.405
4625.........................................           390       15.229
5000.........................................           390       17.363
500..........................................           455        2.245
875..........................................           455        2.969
1250.........................................           455        3.867
1625.........................................           455        4.992
2000.........................................           455        6.215
2375.........................................           455        7.415
2750.........................................           455         8.76
3125.........................................           455       10.175
3500.........................................           455        11.53
3875.........................................           455       12.889
4250.........................................           455       14.686
4625.........................................           455       17.243
5000.........................................           455       19.633
500..........................................           520        3.497
875..........................................           520        4.444
1250.........................................           520        5.084
1625.........................................           520        5.764
2000.........................................           520        7.205
2375.........................................           520        8.597
2750.........................................           520       10.135
3125.........................................           520       11.708
3500.........................................           520       12.962
3875.........................................           520       14.225
4250.........................................           520       15.647
4625.........................................           520       17.579
5000.........................................           520       20.031
500..........................................           585        5.179
875..........................................           585        5.962
1250.........................................           585          5.8
1625.........................................           585        6.341
2000.........................................           585        7.906
2375.........................................           585        9.452
2750.........................................           585       10.979
3125.........................................           585       13.019
3500.........................................           585       13.966
3875.........................................           585       15.661
4250.........................................           585       16.738
4625.........................................           585       17.935
5000.........................................           585       19.272
500..........................................           650        6.834
875..........................................           650        7.316
1250.........................................           650        5.632
1625.........................................           650        6.856
2000.........................................           650        8.471
2375.........................................           650       10.068
2750.........................................           650       11.671
3125.........................................           650       14.655
3500.........................................           650       14.804
3875.........................................           650       16.539
4250.........................................           650       18.415
4625.........................................           650       19.152
5000.........................................           650        20.33
------------------------------------------------------------------------


0
138. Part 1037 is revised to read as follows:

PART 1037--CONTROL OF EMISSIONS FROM NEW HEAVY-DUTY MOTOR VEHICLES

Subpart A--Overview and Applicability
Sec. C
1037.1 Applicability.
1037.2 Who is responsible for compliance?
1037.5 Excluded vehicles.
1037.10 How is this part organized?
1037.15 Do any other regulation parts apply to me?
1037.30 Submission of information.
Subpart B--Emission Standards and Related Requirements
1037.101 Overview of emission standards for heavy-duty vehicles.
1037.102 Exhaust emission standards for NOX, HC, PM, and 
CO.
1037.103 Evaporative and refueling emission standards.
1037.104 Exhaust emission standards for chassis-certified heavy-duty 
vehicles at or below 14,000 pounds GVWR.
1037.105 CO2 emission standards for vocational vehicles.
1037.106 Exhaust emission standards for tractors above 26,000 pounds 
GVWR.
1037.107 Emission standards for trailers.
1037.115 Other requirements.
1037.120 Emission-related warranty requirements.
1037.125 Maintenance instructions and allowable maintenance.
1037.130 Assembly instructions for secondary vehicle manufacturers.
1037.135 Labeling.
1037.140 Classifying vehicles and determining vehicle parameters.
1037.150 Interim provisions.
Subpart C--Certifying Vehicle Families
1037.201 General requirements for obtaining a certificate of 
conformity.
1037.205 What must I include in my application?
1037.210 Preliminary approval before certification.
1037.211 Preliminary approval for manufacturers of aerodynamic 
devices.
1037.220 Amending maintenance instructions.
1037.225 Amending applications for certification.
1037.230 Vehicle families, sub-families, and configurations.
1037.231 Powertrain families.
1037.232 Axle and transmission families.
1037.235 Testing requirements for certification.
1037.241 Demonstrating compliance with exhaust emission standards 
for greenhouse gas pollutants.
1037.243 Demonstrating compliance with evaporative emission 
standards.
1037.250 Reporting and recordkeeping.
1037.255 What decisions may EPA make regarding my certificate of 
conformity?
Subpart D--Testing Production Vehicles and Engines
1037.301 Overview of measurements related to GEM inputs in a 
selective enforcement audit.
1037.305 Audit procedures for tractors--aerodynamic testing.
1037.310 Audit procedures for trailers.
1037.315 Audit procedures related to powertrain testing.
1037.320 Audit procedures for axles and transmissions.
Subpart E--In-use Testing
1037.401 General provisions.
Subpart F--Test and Modeling Procedures
1037.501 General testing and modeling provisions.
1037.510 Duty-cycle exhaust testing.
1037.515 Determining CO2 emissions to show compliance for 
trailers.
1037.520 Modeling CO2 emissions to show compliance for 
vocational vehicles and tractors.
1037.525 Aerodynamic measurements for tractors.
1037.526 Aerodynamic measurements for trailers.
1037.527 Aerodynamic measurements for vocational vehicles.
1037.528 Coastdown procedures for calculating drag area 
(CdA).
1037.530 Wind-tunnel procedures for calculating drag area 
(CdA).
1037.532 Using computational fluid dynamics to calculate drag area 
(CdA).
1037.534 Constant-speed procedure for calculating drag area 
(CdA).
1037.540 Special procedures for testing vehicles with hybrid power 
take-off.
1037.550 Powertrain testing.
1037.551 Engine-based simulation of powertrain testing.
1037.555 Special procedures for testing Phase 1 hybrid systems.
1037.560 Axle efficiency test.
1037.565 Transmission efficiency test.
Subpart G--Special Compliance Provisions
1037.601 General compliance provisions.
1037.605 Installing engines certified to alternate standards for 
specialty vehicles.
1037.610 Vehicles with off-cycle technologies.
1037.615 Advanced technologies.
1037.620 Responsibilities for multiple manufacturers.
1037.621 Delegated assembly.
1037.622 Shipment of partially complete vehicles to secondary 
vehicle manufacturers.
1037.630 Special purpose tractors.
1037.631 Exemption for vocational vehicles intended for off-road 
use.
1037.635 Glider kits and glider vehicles.
1037.640 Variable vehicle speed limiters.
1037.645 In-use compliance with family emission limits (FELs).
1037.655 Post-useful life vehicle modifications.
1037.660 Idle-reduction technologies.
1037.665 Production and in-use tractor testing.
1037.670 Optional CO2 emission standards for tractors at 
or above 120,000 pounds GCWR.

[[Page 74049]]

Subpart H--Averaging, Banking, and Trading for Certification
1037.701 General provisions.
1037.705 Generating and calculating emission credits.
1037.710 Averaging.
1037.715 Banking.
1037.720 Trading.
1037.725 What must I include in my application for certification?
1037.730 ABT reports.
1037.735 Recordkeeping.
1037.740 Restrictions for using emission credits.
1037.745 End-of-year CO2 credit deficits.
1037.750 What can happen if I do not comply with the provisions of 
this subpart?
1037.755 Information provided to the Department of Transportation.
Subpart I--Definitions and Other Reference Information
1037.801 Definitions.
1037.805 Symbols, abbreviations, and acronyms.
1037.810 Incorporation by reference.
1037.815 Confidential information.
1037.820 Requesting a hearing.
1037.825 Reporting and recordkeeping requirements.

    &&Appendix I to Part 1037--Heavy-duty Transient Test Cycle
    Appendix II to Part 1037--Power Take-Off Test Cycle
    Appendix III to Part 1037--Emission Control Identifiers
    Appendix IV to Part 1037--Heavy-duty Grade Profile for Phase 2 
Steady-State Test Cycles
    Appendix V to Part 1037--Power Take-Off Utility Factors

    Authority: 42 U.S.C. 7401--7671q.

Subpart A--Overview and Applicability


Sec.  1037.1  Applicability.

    (a) This part contains standards and other regulations applicable 
to the emission of the air pollutant defined as the aggregate group of 
six greenhouse gases: carbon dioxide, nitrous oxide, methane, 
hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride. The 
regulations in this part 1037 apply for all new heavy-duty vehicles, 
except as provided in Sec. Sec.  1037.5 and 1037.104. This includes 
electric vehicles and vehicles fueled by conventional and alternative 
fuels. This also includes certain trailers as described in Sec. Sec.  
1037.5, 1037.150, and 1037.801.
    (b) The provisions of this part apply for alternative fuel 
conversions as specified in 40 CFR part 85, subpart F.


Sec.  1037.2  Who is responsible for compliance?

    The regulations in this part 1037 contain provisions that affect 
both vehicle manufacturers and others. However, the requirements of 
this part are generally addressed to the vehicle manufacturer(s). The 
term ``you'' generally means the vehicle manufacturer(s), especially 
for issues related to certification. See Sec.  1037.801 for the 
definition of ``manufacturer'' and Sec.  1037.620 for provisions 
related to compliance when there are multiple entities meeting the 
definition of ``manufacturer.'' Additional requirements and 
prohibitions apply to other persons as specified in subpart G of this 
part and 40 CFR part 1068.


Sec.  1037.5  Excluded vehicles.

    Except for the definitions specified in Sec.  1037.801, this part 
does not apply to the following vehicles:
    (a) Vehicles not meeting the definition of ``motor vehicle'' in 
Sec.  1037.801.
    (b) Vehicles excluded from the definition of ``heavy-duty vehicle'' 
in Sec.  1037.801 because of vehicle weight, weight rating, and frontal 
area (such as light-duty vehicles and light-duty trucks).
    (c) Vehicles produced in model years before 2014, unless they were 
certified under Sec.  1037.150.
    (d) Medium-duty passenger vehicles and other vehicles subject to 
the light-duty greenhouse gas standards of 40 CFR part 86. See 40 CFR 
86.1818 for greenhouse gas standards that apply for these vehicles. An 
example of such a vehicle would be a vehicle meeting the definition of 
``heavy-duty vehicle'' in Sec.  1037.801 and 40 CFR 86.1803, but also 
meeting the definition of ``light truck'' in 40 CFR 86.1818-12(b)(2).
    (e) Vehicles subject to the heavy-duty greenhouse gas standards of 
40 CFR part 86. See 40 CFR 86.1819 for greenhouse gas standards that 
apply for these vehicles. This generally applies for complete heavy-
duty vehicles at or below 14,000 pounds GVWR.
    (f) Aircraft meeting the definition of ``motor vehicle''. For 
example, this would include certain convertible aircraft that can be 
adjusted to operate on public roads. Standards apply separately to 
certain aircraft engines, as described in 40 CFR part 87.
    (g) Non-box trailers other than flatbed trailers, tank trailers, 
and container chassis.
    (h) Trailers meeting one or more of the following characteristics:
    (1) Trailers with four or more axles and trailers less than 35 feet 
long with three axles (i.e., trailers intended for hauling very heavy 
loads).
    (2) Trailers intended for temporary or permanent residence, office 
space, or other work space, such as campers, mobile homes, and carnival 
trailers.
    (3) Trailers with a gap of at least 120 inches between adjacent 
axle centerlines. In the case of adjustable axle spacing, this refers 
to the closest possible axle positioning.
    (4) Trailers built before January 1, 2018.
    (5) Note that the definition of ``trailer'' in Sec.  1037.801 
excludes equipment that serves similar purposes but are not intended to 
be pulled by a tractor. This exclusion applies to such equipment 
whether or not they are known commercially as trailers. For example, 
any equipment pulled by a heavy-duty vehicle with a pintle hook or 
hitch instead of a fifth wheel does not qualify as a trailer under this 
part.
    (i) Where it is unclear, you may ask us to make a determination 
regarding the exclusions identified in this section. We recommend that 
you make your request before you produce the vehicle.


Sec.  1037.10  How is this part organized?

    This part 1037 is divided into the following subparts:
    (a) Subpart A of this part defines the applicability of part 1037 
and gives an overview of regulatory requirements.
    (b) Subpart B of this part describes the emission standards and 
other requirements that must be met to certify vehicles under this 
part. Note that Sec.  1037.150 discusses certain interim requirements 
and compliance provisions that apply only for a limited time.
    (c) Subpart C of this part describes how to apply for a certificate 
of conformity for vehicles subject to the standards of Sec.  1037.105 
or Sec.  1037.106.
    (d) Subpart D of this part addresses testing of production 
vehicles.
    (e) Subpart E of this part addresses testing of in-use vehicles.
    (f) Subpart F of this part describes how to test your vehicles and 
perform emission modeling (including references to other parts of the 
Code of Federal Regulations) for vehicles subject to the standards of 
Sec.  1037.105 or Sec.  1037.106.
    (g) Subpart G of this part and 40 CFR part 1068 describe 
requirements, prohibitions, and other provisions that apply to 
manufacturers, owners, operators, rebuilders, and all others. Section 
1037.601 describes how 40 CFR part 1068 applies for heavy-duty 
vehicles.
    (h) Subpart H of this part describes how you may generate and use 
emission credits to certify vehicles.
    (i) Subpart I of this part contains definitions and other reference 
information.

[[Page 74050]]

Sec.  1037.15  Do any other regulation parts apply to me?

    (a) Parts 1065 and 1066 of this chapter describe procedures and 
equipment specifications for testing engines and vehicles to measure 
exhaust emissions. Subpart F of this part 1037 describes how to apply 
the provisions of part 1065 and part 1066 of this chapter to determine 
whether vehicles meet the exhaust emission standards in this part.
    (b) As described in Sec.  1037.601, certain requirements and 
prohibitions of part 1068 of this chapter apply to everyone, including 
anyone who manufactures, imports, installs, owns, operates, or rebuilds 
any of the vehicles subject to this part 1037. Part 1068 of this 
chapter describes general provisions that apply broadly, but do not 
necessarily apply for all vehicles or all persons. The issues addressed 
by these provisions include these seven areas:
    (1) Prohibited acts and penalties for manufacturers and others.
    (2) Rebuilding and other aftermarket changes.
    (3) Exclusions and exemptions for certain vehicles.
    (4) Importing vehicles.
    (5) Selective enforcement audits of your production.
    (6) Recall.
    (7) Procedures for hearings.
    (c) [Reserved]
    (d) Other parts of this chapter apply if referenced in this part.


Sec.  1037.30  Submission of information.

    Unless we specify otherwise, send all reports and requests for 
approval to the Designated Compliance Officer (see Sec.  1037.801). See 
Sec.  1037.825 for additional reporting and recordkeeping provisions.

Subpart B--Emission Standards and Related Requirements


Sec.  1037.101  Overview of emission standards for heavy-duty vehicles.

    (a) This part specifies emission standards for certain vehicles and 
for certain pollutants. This part contains standards and other 
regulations applicable to the emission of the air pollutant defined as 
the aggregate group of six greenhouse gases: Carbon dioxide, nitrous 
oxide, methane, hydrofluorocarbons, perfluorocarbons, and sulfur 
hexafluoride.
    (b) The regulated emissions are addressed in four groups:
    (1) Exhaust emissions of NOx, HC, PM, and CO. These 
pollutants are sometimes described collectively as ``criteria 
pollutants'' because they are either criteria pollutants under the 
Clean Air Act or precursors to the criteria pollutant ozone. These 
pollutants are also sometimes described collectively as ``non-
greenhouse gas pollutants'', although they do not necessarily have 
negligible global warming potential. As described in Sec.  1037.102, 
standards for these pollutants are provided in 40 CFR part 86.
    (2) Exhaust emissions of CO2, CH4, and 
N2O. These pollutants are described collectively in this 
part as ``greenhouse gas pollutants'' because they are regulated 
primarily based on their impact on the climate. These standards are 
provided in Sec. Sec.  1037.105 through 1037.107.
    (3) Hydrofluorocarbons. These pollutants are also ``greenhouse gas 
pollutants'' but are treated separately from exhaust greenhouse gas 
pollutants listed in paragraph (b)(2) of this section. These standards 
are provided in Sec.  1037.115.
    (4) Fuel evaporative emissions. These requirements are described in 
Sec.  1037.103.
    (c) The regulated heavy-duty vehicles are addressed in different 
groups as follows:
    (1) For criteria pollutants, vocational vehicles and tractors are 
regulated based on gross vehicle weight rating (GVWR), whether they are 
considered ``spark-ignition'' or ``compression-ignition,'' and whether 
they are first sold as complete or incomplete vehicles.
    (2) For greenhouse gas pollutants, vehicles are regulated in the 
following groups:
    (i) Tractors above 26,000 pounds GVWR.
    (ii) Trailers.
    (iii) Vocational vehicles.
    (3) The greenhouse gas emission standards apply differently 
depending on the vehicle service class as described in Sec.  1037.140. 
In addition, standards apply differently for vehicles with spark-
ignition and compression-ignition engines. References in this part 1037 
to ``spark-ignition'' or ``compression-ignition'' generally relate to 
the application of standards under 40 CFR 1036.140. For example, a 
vehicle with an engine certified to spark-ignition standards under 40 
CFR part 1036 is generally subject to requirements under this part 1037 
that apply for spark-ignition vehicles. However, note that emission 
standards for heavy heavy-duty engines are considered to be 
compression-ignition standards for purposes of applying vehicle 
emission standards under this part. Also, for spark-ignition engines 
voluntarily certified as compression-ignition engines under 40 CFR part 
1036, you must choose at certification whether your vehicles are 
subject to spark-ignition standards or compression-ignition standards.
    (4) For evaporative and refueling emissions, vehicles are regulated 
based on the type of fuel they use. Vehicles fueled with volatile 
liquid fuels or gaseous fuels are subject to evaporative emission 
standards. Vehicles up to a certain size that are fueled with gasoline, 
diesel fuel, ethanol, methanol, or LPG are subject to refueling 
emission standards.


Sec.  1037.102  Exhaust emission standards for NOX, HC, PM, 
and CO.

    See 40 CFR part 86 for the exhaust emission standards for 
NOX, HC, PM, and CO that apply for heavy-duty vehicles.


Sec.  1037.103  Evaporative and refueling emission standards.

    (a) Applicability. Evaporative and refueling emission standards 
apply to heavy-duty vehicles as follows:
    (1) Complete and incomplete heavy-duty vehicles at or below 14,000 
pounds GVWR must meet evaporative and refueling emission standards as 
specified in 40 CFR part 86, subpart S, instead of the requirements 
specified in this section.
    (2) Heavy-duty vehicles above 14,000 pounds GVWR that run on 
volatile liquid fuel (such as gasoline or ethanol) or gaseous fuel 
(such as natural gas or LPG) must meet evaporative and refueling 
emission standards as specified in this section.
    (b) Emission standards. The evaporative and refueling emission 
standards and measurement procedures specified in 40 CFR 86.1813 apply 
for vehicles above 14,000 pounds GVWR, except as described in this 
section. The evaporative emission standards phase in over model years 
2018 through 2022, with provisions allowing for voluntary compliance 
with the standards as early as model year 2015. Count vehicles subject 
to standards under this section the same as heavy-duty vehicles at or 
below 14,000 pounds GVWR to comply with the phase-in requirements 
specified in 40 CFR 86.1813. These vehicles may generate and use 
emission credits as described in 40 CFR part 86, subpart S, but only 
for vehicles that are tested for certification instead of relying on 
the provisions of paragraph (c) of this section. The following 
provisions apply instead of what is specified in 40 CFR 86.1813:
    (1) The refueling standards in 40 CFR 86.1813-17(b) apply to 
complete vehicles starting in model year 2022; they are optional for 
incomplete vehicles.

[[Page 74051]]

    (2) The leak standard in 40 CFR 86.1813-17(a)(4) does not apply.
    (3) The FEL cap relative to the diurnal plus hot soak standard for 
low-altitude testing is 1.9 grams per test.
    (4) The diurnal plus hot soak standard for high-altitude testing is 
2.3 grams per test.
    (5) Testing does not require measurement of exhaust emissions. 
Disregard references in subpart B of this part to procedures, equipment 
specifications, and recordkeeping related to measuring exhaust 
emissions. All references to the exhaust test under 40 CFR part 86, 
subpart B, are considered the ``dynamometer run'' as part of the 
evaporative testing sequence under this subpart.
    (6) Vehicles not yet subject to the Tier 3 standards in 40 CFR 
86.1813 must meet evaporative emission standards as specified in 40 CFR 
86.008-10(b)(1) and (2) for Otto-cycle applications and 40 CFR 86.007-
11(b)(3)(ii) and (b)(4)(ii) for diesel-cycle applications.
    (c) Compliance demonstration. You may provide a statement in the 
application for certification that vehicles above 14,000 pounds GVWR 
comply with evaporative and refueling emission standards instead of 
submitting test data if you include an engineering analysis describing 
how vehicles include design parameters, equipment, operating controls, 
or other elements of design that adequately demonstrate that vehicles 
comply with the standards. We would expect emission control components 
and systems to exhibit a comparable degree of control relative to 
vehicles that comply based on testing. For example, vehicles that 
comply under this paragraph (c) should rely on comparable material 
specifications to limit fuel permeation, and components should be sized 
and calibrated to correspond with the appropriate fuel capacities, fuel 
flow rates, purge strategies, and other vehicle operating 
characteristics. You may alternatively show that design parameters are 
comparable to those for vehicles at or below 14,000 pounds GVWR 
certified under 40 CFR part 86, subpart S.
    (d) CNG refueling requirement. Compressed natural gas vehicles must 
meet the requirements for fueling connection devices as specified in 40 
CFR 86.1813-17(f)(1). Vehicles meeting these requirements are deemed to 
comply with evaporative and refueling emission standards.
    (e) LNG refueling requirement. Fuel tanks for liquefied natural gas 
vehicles must meet the hold-time requirements in Section 4.2 of SAE 
J2343 (incorporated by reference in Sec.  1037.810), as modified by 
this paragraph (e). All pressures noted are gauge pressure. Vehicles 
with tanks meeting these requirements are deemed to comply with 
evaporative and refueling emission standards. The provisions of this 
paragraph (e) are optional for vehicles produced before January 1, 
2020. The hold-time requirements of SAE J2343 apply, with the following 
clarifications and additions:
    (1) Hold time must be at least 120 hours. Use the following 
procedure to determine hold time for an LNG fuel tank that will be 
installed on a heavy-duty vehicle:
    (i) Prepare the stored (offboard) fuel and the vehicle such that 
tank pressure after the refueling event stabilizes below 690 kPa.
    (ii) Fill the tank to the point of automatic shutoff using a 
conventional refueling system. This is intended to achieve a net full 
condition.
    (iii) The hold time starts when tank pressure increases to 690 kPa, 
and ends when the tank first vents for pressure relief. Use good 
engineering judgment to document the point at which the pressure-relief 
valve opens.
    (iv) Keep the tank at rest away from direct sun with ambient 
temperatures between (10 and 30) [deg]C throughout the measurement 
procedure.
    (2) Following a complete refueling event as described in paragraph 
(e)(1) of this section and a short drive, installed tanks may not 
increase in pressure by more than 9 kPa per hour over a minimum 12 hour 
interval when parked away from direct sun with ambient temperatures at 
or below 30 [deg]C. Calculate the allowable pressure gain by 
multiplying the park time in hours by 9 and rounding to the nearest 
whole number. Do not include the first hour after engine shutdown, and 
start the test only when tank pressure is between 345 and 900 kPa.
    (3) The standards described in this paragraph (e) apply over the 
vehicle's useful life as specified in paragraph (f) of this section. 
The warranty requirements of Sec.  1037.120 also apply for these 
standards.
    (4) You may specify any amount of inspection and maintenance, 
consistent with good engineering judgment, to ensure that tanks meet 
the standards in this paragraph (e) during and after the useful life.
    (f) Useful life. The evaporative emission standards of this section 
apply for the full useful life, expressed in service miles or calendar 
years, whichever comes first. The useful life values for the standards 
of this section are the same as the values described for evaporative 
emission standards in 40 CFR 86.1805.
    (g) Auxiliary engines and separate fuel systems. The provisions of 
this paragraph (g) apply for vehicles with auxiliary engines. This 
includes any engines installed in the final vehicle configuration that 
contribute no motive power through the vehicle's transmission.
    (1) Auxiliary engines and associated fuel-system components must be 
installed when testing complete vehicles. If the auxiliary engine draws 
fuel from a separate fuel tank, you must fill the extra fuel tank 
before the start of diurnal testing as described for the vehicle's main 
fuel tank. Use good engineering judgment to ensure that any nonmetal 
portions of the fuel system related to the auxiliary engine have 
reached stabilized levels of permeation emissions. The auxiliary engine 
must not operate during the running loss test or any other portion of 
testing under this section.
    (2) For testing with incomplete vehicles, you may omit installation 
of auxiliary engines and associated fuel-system components as long as 
those components installed in the final configuration are certified to 
meet the applicable emission standards for Small SI equipment described 
in 40 CFR 1054.112 or for Large SI engines in 40 CFR 1048.105. For any 
fuel-system components that you do not install, your installation 
instructions must describe this certification requirement.


Sec.  1037.104  Exhaust emission standards for chassis-certified heavy-
duty vehicles at or below 14,000 pounds GVWR.

    Heavy-duty vehicles at or below 14,000 pounds GVWR are not subject 
to the provisions of this part 1037 if they are subject to 40 CFR part 
86, subpart S, including all vehicles certified under 40 CFR part 86, 
subpart S. See especially 40 CFR 86.1819 and 86.1865 for emission 
standards and compliance provisions that apply for these vehicles.


Sec.  1037.105  CO2 emission standards for vocational 
vehicles.

    (a) The standards of this section apply for the following vehicles:
    (1) Heavy-duty vehicles at or below 14,000 pounds GVWR that are 
excluded from the standards in 40 CFR 86.1819 or that use engines 
certified under Sec.  1037.150(m).
    (2) Vehicles above 14,000 pounds GVWR and at or below 26,000 pounds 
GVWR, but not certified to the vehicle standards in 40 CFR 86.1819.
    (3) Vehicles above 26,000 pounds GVWR that are not tractors.
    (4) Vocational tractors.

[[Page 74052]]

    (b) CO2 standards in this paragraph (b) apply based on 
modeling and testing as specified in subpart F of this part. The 
provisions of Sec.  1037.241 specify how to comply with these 
standards. Standards differ based on engine cycle, vehicle size, and 
intended vehicle duty cycle. See Sec.  1037.510(c) to determine which 
duty cycle applies.
    (1) Model year 2027 and later vehicles are subject to 
CO2 standards corresponding to the selected subcategories as 
shown in the following table:

       Table 1 of Sec.   1037.105--Phase 2 CO2 Standards for Model Year 2027 and Later Vocational Vehicles
                                                  [g/ton-mile]
----------------------------------------------------------------------------------------------------------------
             Engine cycle                     Vehicle size         Multi-purpose     Regional          Urban
----------------------------------------------------------------------------------------------------------------
Compression-ignition..................  Light HDV...............             330             291             367
Compression-ignition..................  Medium HDV..............             235             218             258
Compression-ignition..................  Heavy HDV...............             230             189             269
Spark-ignition........................  Light HDV...............             372             319             413
Spark-ignition........................  Medium HDV..............             268             247             297
----------------------------------------------------------------------------------------------------------------

    (2) Model year 2024 through 2026 vehicles are subject to 
CO2 standards corresponding to the selected subcategories as 
shown in the following table:

     Table 2 of Sec.   1037.105--Phase 2 CO2 Standards for Model Year 2024 Through 2026 Vocational Vehicles
                                                  [g/ton-mile]
----------------------------------------------------------------------------------------------------------------
             Engine cycle                     Vehicle size         Multi-purpose     Regional          Urban
----------------------------------------------------------------------------------------------------------------
Compression-ignition..................  Light HDV...............             344             296             385
Compression-ignition..................  Medium HDV..............             246             221             271
Compression-ignition..................  Heavy HDV...............             242             194             283
Spark-ignition........................  Light HDV...............             385             324             432
Spark-ignition........................  Medium HDV..............             279             251             310
----------------------------------------------------------------------------------------------------------------

    (3) Model year 2021 Through 2023 vehicles are subject to 
CO2 standards corresponding to the selected subcategories as 
shown in the following table:

     Table 3 of Sec.   1037.105--Phase 2 CO2 Standards for Model Year 2021 Through 2023 Vocational Vehicles
                                                  [g/ton-mile]
----------------------------------------------------------------------------------------------------------------
             Engine cycle                     Vehicle size         Multi-purpose     Regional          Urban
----------------------------------------------------------------------------------------------------------------
Compression-ignition..................  Light HDV...............             373             311             424
Compression-ignition..................  Medium HDV..............             265             234             296
Compression-ignition..................  Heavy HDV...............             261             205             308
Spark-ignition........................  Light HDV...............             407             335             461
Spark-ignition........................  Medium HDV..............             293             261             328
----------------------------------------------------------------------------------------------------------------

    (4) Model year 2014 through 2020 vehicles are subject to Phase 1 
CO2 standards as shown in the following table:

  Table 4 of Sec.   1037.105--Phase 1 CO2 Standards for Model Year 2014
                    Through 2020 Vocational Vehicles
                              [g/ton-mile]
------------------------------------------------------------------------
                                      CO2 standard for  CO2 standard for
            Vehicle size              model years 2014-  model year 2017
                                            2016            and later
------------------------------------------------------------------------
Light HDV...........................               388               373
Medium HDV..........................               234               225
Heavy HDV...........................               226               222
------------------------------------------------------------------------

    (c) No CH4 or N2O standards apply under this 
section. See 40 CFR part 1036 for CH4 or N2O 
standards that apply to engines used in these vehicles.
    (d) You may generate or use emission credits for averaging, 
banking, and trading to demonstrate compliance with the standards in 
paragraph (b) of this section as described in subpart H of this part. 
This requires that you specify a Family Emission Limit (FEL) for 
CO2 for each vehicle subfamily. The FEL may not be less than 
the result of emission modeling from Sec.  1037.520. These FELs

[[Page 74053]]

serve as the emission standards for the vehicle subfamily instead of 
the standards specified in paragraph (b) of this section.
    (e) The exhaust emission standards of this section apply for the 
full useful life, expressed in service miles or calendar years, 
whichever comes first. The following useful life values apply for the 
standards of this section:
    (1) 150,000 miles or 15 years, whichever comes first, for Light 
HDV.
    (2) 185,000 miles or 10 years, whichever comes first, for Medium 
HDV.
    (3) 435,000 miles or 10 years, whichever comes first, for Heavy 
HDV.
    (f) See Sec.  1037.631 for provisions that exempt certain vehicles 
used in off-road operation from the standards of this section.
    (g) You may optionally certify a vocational vehicle to the 
standards and useful life applicable to a heavier vehicle service class 
(such as Medium HDV instead of Light HDV). Provisions related to 
generating emission credits apply as follows:
    (1) If you certify all your vehicles from a given vehicle service 
class in a given model year to the standards and useful life that 
applies for a heavier vehicle service class, you may generate credits 
as appropriate for the heavier service class.
    (2) Class 8 hybrid vehicles with light or medium heavy-duty engines 
may be certified to compression-ignition standards for the Heavy HDV 
service class. You may generate and use credits as allowed for the 
Heavy HDV service class.
    (3) Except as specified in paragraphs (g)(1) and (2) of this 
section, you may not generate credits with the vehicle. If you include 
lighter vehicles in a subfamily of heavier vehicles with an FEL below 
the standard, exclude the production volume of lighter vehicles from 
the credit calculation. Conversely, if you include lighter vehicles in 
a subfamily with an FEL above the standard, you must include the 
production volume of lighter vehicles in the credit calculation.
    (h) You may optionally certify certain vocational vehicles to 
alternative Phase 2 standards as specified in this paragraph (h) 
instead of the standards specified in paragraph (b) of this section. 
You may apply these provisions to any qualifying vehicles even though 
these standards were established for custom chassis. For example, large 
diversified vehicle manufacturers may certify vehicles to the refuse 
hauler standards of this section as long as the manufacturer ensures 
that those vehicles qualify as refuse haulers when placed into service. 
GEM simulates vehicle operation for each type of vehicle based on an 
assigned vehicle service class, independent of the vehicle's actual 
characteristics, as shown in Table 5 of this section; however, 
standards apply for the vehicle's useful life based on its actual 
characteristics as specified in paragraph (e) of this section. Vehicles 
certified to these standards must include the following statement on 
the emission control label: ``THIS VEHICLE WAS CERTIFIED AS A [identify 
vehicle type as identified in Table 5 of this section] UNDER 40 CFR 
1037.105(h)].'' These custom-chassis standards apply as follows:
    (1) The following alternative emission standards apply by vehicle 
type and model year as follows:

                          Table 5 of Sec.   1037.105--Phase 2 Custom Chassis Standards
                                                  [g/ton-mile]
----------------------------------------------------------------------------------------------------------------
               Vehicle type \1\                  Assigned vehicle service class    MY  2021-2026     MY 2027+
----------------------------------------------------------------------------------------------------------------
School bus....................................  Medium HDV......................             291             271
Motor home....................................  Medium HDV......................             228             226
Coach bus.....................................  Heavy HDV.......................             210             205
Other bus.....................................  Heavy HDV.......................             300             286
Refuse hauler.................................  Heavy HDV.......................             313             298
Concrete mixer................................  Heavy HDV.......................             319             316
Mixed-use vehicle.............................  Heavy HDV.......................             319             316
Emergency vehicle.............................  Heavy HDV.......................             324             319
----------------------------------------------------------------------------------------------------------------
\1\ Vehicle types are generally defined in Sec.   1037.801. ``Other bus'' includes any bus that is not a school
  bus or a coach bus. A ``mixed-use vehicle'' is one that meets at least one of the criteria specified in Sec.
  1037.631(a)(1) and at least one of the criteria in Sec.   1037.631(a)(2), but not both.

    (2) You may generate or use emission credits for averaging to 
demonstrate compliance with the alternative standards as described in 
subpart H of this part. This requires that you specify a Family 
Emission Limit (FEL) for CO2 for each vehicle subfamily. The 
FEL may not be less than the result of emission modeling as described 
in Sec.  1037.520. These FELs serve as the emission standards for the 
vehicle subfamily instead of the standards specified in this paragraph 
(h). Calculate credits using the equation in Sec.  1037.705(b) with the 
standard payload for the assigned vehicle service class and the useful 
life identified in paragraph (e) of this section. Each separate vehicle 
type identified in Table 5 of this section (or group of vehicle types 
identified in a single row) represents a separate averaging set. You 
may not use averaging for vehicles meeting standards under paragraph 
(h)(5) through (7) of this section, and you may not bank or trade 
emission credits from any vehicles certified under this paragraph (h).
    (3) [Reserved]
    (4) For purposes of emission modeling under Sec.  1037.520, 
consider motor homes and coach buses to be subject to the Regional duty 
cycle, and consider all other vehicles to be subject to the Urban duty 
cycle.
    (5) Emergency vehicles are deemed to comply with the standards of 
this paragraph (h) if they use tires with TRRL at or below 8.4 kg/tonne 
(8.7 g/tonne for model years 2021 through 2026).
    (6) Concrete mixers and mixed-use vehicles are deemed to comply 
with the standards of this paragraph (h) if they use tires with TRRL at 
or below 7.1 kg/tonne (7.6 g/tonne for model years 2021 through 2026).
    (7) Motor homes are deemed to comply with the standards of this 
paragraph (h) if they have tires with TRRL at or below 6.0 kg/tonne 
(6.7 g/tonne for model years 2021 through 2026) and automatic tire 
inflation systems or tire pressure monitoring systems with wheels on 
all axles.
    (8) Vehicles certified to standards under this paragraph (h) must 
use engines certified under 40 CFR part 1036 for the appropriate model 
year,

[[Page 74054]]

except that motor homes and emergency vehicles may use engines 
certified with the loose-engine provisions of Sec.  1037.150(m). This 
also applies for vehicles meeting standards under paragraphs (h)(5) 
through (7) of this section.


Sec.  1037.106  Exhaust emission standards for tractors above 26,000 
pounds GVWR.

    (a) The CO2 standards of this section apply for tractors 
above 26,000 pounds GVWR. Note that the standards of this section do 
not apply for vehicles classified as ``vocational tractors'' under 
Sec.  1037.630.
    (b) The CO2 standards for tractors above 26,000 pounds 
GVWR in Table 1 of this section apply based on modeling and testing as 
described in subpart F of this part. The provisions of Sec.  1037.241 
specify how to comply with these standards.

            Table 1 of Sec.   1037.106--CO2 Standards for Class 7 and Class 8 Tractors by Model Year
                                                  [g/ton-mile]
----------------------------------------------------------------------------------------------------------------
                                      Phase 1         Phase 1         Phase 2         Phase 2         Phase 2
                                   standards for   standards for   standards for   standards for   standards for
         Subcategory \1\            model years     model years     model years     model years     model year
                                     2014-2016       2017-2020       2021-2023       2024-2026    2027 and later
----------------------------------------------------------------------------------------------------------------
Class 7 Low-Roof (all cab                    107             104           105.5            99.8            96.2
 styles)........................
Class 7 Mid-Roof (all cab                    119             115           113.2           107.1           103.4
 styles)........................
Class 7 High-Roof (all cab                   124             120           113.5           106.6           100.0
 styles)........................
Class 8 Low-Roof Day Cab........              81              80            80.5            76.2            73.4
Class 8 Low-Roof Sleeper Cab....              68              66            72.3            68.0            64.1
Class 8 Mid-Roof Day Cab........              88              86            85.4            80.9            78.0
Class 8 Mid-Roof Sleeper Cab....              76              73            78.0            73.5            69.6
Class 8 High-Roof Day Cab.......              92              89            85.6            80.4            75.7
Class 8 High-Roof Sleeper Cab...              75              72            75.7            70.7            64.3
Heavy-Haul Tractors.............  ..............  ..............            52.4            50.2            48.3
----------------------------------------------------------------------------------------------------------------
\1\ Sub-category terms are defined in Sec.   1037.801.

    (c) No CH4 or N2O standards apply under this 
section. See 40 CFR part 1036 for CH4 or N2O 
standards that apply to engines used in these vehicles.
    (d) You may generate or use emission credits for averaging, 
banking, and trading as described in subpart H of this part. This 
requires that you calculate a credit quantity if you specify a Family 
Emission Limit (FEL) that is different than the standard specified in 
this section for a given pollutant. The FEL may not be less than the 
result of emission modeling from Sec.  1037.520. These FELs serve as 
the emission standards for the specific vehicle subfamily instead of 
the standards specified in paragraph (a) of this section.
    (e) The exhaust emission standards of this section apply for the 
full useful life, expressed in service miles or calendar years, 
whichever comes first. The following useful life values apply for the 
standards of this section:
    (1) 185,000 miles or 10 years, whichever comes first, for vehicles 
at or below 33,000 pounds GVWR.
    (2) 435,000 miles or 10 years, whichever comes first, for vehicles 
above 33,000 pounds GVWR.
    (f) You may optionally certify Class 7 tractors to Class 8 
standards as follows:
    (1) You may optionally certify 4x2 tractors with heavy heavy-duty 
engines to the standards and useful life for Class 8 tractors, with no 
restriction on generating or using emission credits within the Class 8 
averaging set.
    (2) You may optionally certify Class 7 tractors not covered by 
paragraph (f)(1) of this section to the standards and useful life for 
Class 8 tractors. Credit provisions apply as follows:
    (i) If you certify all your Class 7 tractors to Class 8 standards, 
you may use these Heavy HDV credits without restriction.
    (ii) This paragraph (f)(2)(ii) applies if you certify some Class 7 
tractors to Class 8 standards under this paragraph (f)(2) but not all 
of them. If you include Class 7 tractors in a subfamily of Class 8 
tractors with an FEL below the standard, exclude the production volume 
of Class 7 tractors from the credit calculation. Conversely, if you 
include Class 7 tractors in a subfamily of Class 8 tractors with an FEL 
above the standard, you must include the production volume of Class 7 
tractors in the credit calculation.
    (g) Diesel auxiliary power units installed on tractors subject to 
standards under this section must meet PM standards as follows:
    (1) For model years 2021 through 2023, the APU engine must be 
certified under 40 CFR part 1039 with a deteriorated emission level for 
PM at or below 0.15 g/kW-hr.
    (2) Starting in model year 2024, auxiliary power units installed on 
tractors subject to standards under this section must be certified to 
the PM emission standard specified in 40 CFR 1039.699. Selling, 
offering for sale, or introducing or delivering into commerce in the 
United States or importing into the United States a new tractor subject 
to this standard is a violation of 40 CFR 1068.101(a)(1) unless the 
auxiliary power unit has a valid certificate of conformity and the 
required label showing that it meets the PM standard of this paragraph 
(g)(2).
    (3) See Sec.  1037.660(e) for requirements that apply for diesel 
APUs in model year 2020 and earlier tractors.


Sec.  1037.107  Emission standards for trailers.

    The exhaust emission standards specified in this section apply to 
trailers based on the effect of trailer designs on the performance of 
the trailer in conjunction with a tractor; this accounts for the effect 
of the trailer on the tractor's exhaust emissions, even though trailers 
themselves have no exhaust emissions.
    (a) Standards apply for trailers based on modeling and testing as 
described in subpart F of this part, as follows:
    (1) Different levels of stringency apply for box vans depending on 
features that may affect aerodynamic performance. You may optionally 
meet less stringent standards for different trailer types, which we 
characterize as follows:
    (i) For trailers 35 feet or longer, you may designate as ``non-aero 
box vans'' those box vans that have a rear lift gate or rear hinged 
ramp, and at least one of the following side features: Side lift gate, 
side-mounted pull-out platform, steps for side-door access, a drop-deck 
design, or belly boxes that occupy at least half the length of both 
sides of the trailer between the centerline of the landing gear and the 
leading edge of the

[[Page 74055]]

front wheels. For trailers less than 35 feet long, you may designate as 
``non-aero box vans'' any refrigerated box vans with at least one of 
the side features identified for longer trailers.
    (ii) You may designate as ``partial-aero box vans'' those box vans 
that have at least one of the side features identified in paragraph 
(a)(1)(i) of this section. Long box vans may also qualify as partial-
aero box vans if they have a rear lift gate or rear hinged ramp. Note 
that this paragraph (a)(1)(ii) does not apply for box vans designated 
as ``non-aero box vans'' under paragraph (a)(1)(i) of this section.
    (iii) ``Full-aero box vans'' are box vans that are not designated 
as non-aero box vans or partial-aero box vans under this paragraph 
(a)(1).
    (2) CO2 standards apply for full-aero box vans as 
specified in the following table:

                    Table 1 of Sec.   1037.107--Phase 2 CO2 Standards for Full-Aero Box Vans
                                                  [g/ton-mile]
----------------------------------------------------------------------------------------------------------------
                                                              Dry van                    Refrigerated van
                   Model year                    ---------------------------------------------------------------
                                                       Short           Long            Short           Long
----------------------------------------------------------------------------------------------------------------
2018-2020.......................................           125.4            81.3           129.1            83.0
2021-2023.......................................           123.7            78.9           127.5            80.6
2024-2026.......................................           120.9            77.2           124.7            78.9
2027+...........................................           118.8            75.7           122.7            77.4
----------------------------------------------------------------------------------------------------------------

    (3) CO2 standards apply for partial-aero box vans as 
specified in the following table:

                   Table 2 of Sec.   1037.107--Phase 2 CO2 Standards for Partial-Aero Box Vans
                                                  [g/ton-mile]
----------------------------------------------------------------------------------------------------------------
                                                              Dry van                    Refrigerated van
                   Model year                    ---------------------------------------------------------------
                                                       Short           Long            Short           Long
----------------------------------------------------------------------------------------------------------------
2018-2020.......................................           125.4            81.3           129.1            83.0
2021+...........................................           123.7            80.6           127.5            82.3
----------------------------------------------------------------------------------------------------------------

    (4) Non-box trailers and non-aero box vans must meet standards as 
follows:
    (i) Trailers must use automatic tire inflation systems or tire 
pressure monitoring systems with wheels on all axles.
    (ii) Non-box trailers must use tires with a TRRL at or below 5.1 
kg/tonne. Through model year 2020, non-box trailers may instead use 
tires with a TRRL at or below 6.0 kg/tonne.
    (iii) Non-aero box vans must use tires with a TRRL at or below 4.7 
kg/tonne. Through model year 2020, non-aero box vans may instead use 
tires with a TRRL at or below 5.1 kg/tonne.
    (5) Starting in model year 2027, you may generate or use emission 
credits for averaging to demonstrate compliance with the standards 
specified in paragraph (a)(2) of this section as described in subpart H 
of this part. This requires that you specify a Family Emission Limit 
(FEL) for CO2 for each vehicle subfamily. The FEL may not be 
less than the result of the emission calculation in Sec.  1037.515. The 
FEL may not be greater than the appropriate standard for model year 
2018 trailers. These FELs serve as the emission standards for the 
specific vehicle subfamily instead of the standards specified in 
paragraph (a) of this section. You may not use averaging for non-box 
trailers, partial-aero box vans, or non-aero box vans that meet 
standards under paragraph (a)(3) or (a)(4) of this section, and you may 
not use emission credits for banking or trading for any trailers.
    (6) The provisions of Sec.  1037.241 specify how to comply with the 
standards of this section.
    (b) No CH4, N2O, or HFC standards apply under 
this section.
    (c) The emission standards of this section apply for a useful life 
of 10 years.


Sec.  1037.115  Other requirements.

    Vehicles required to meet the emission standards of this part must 
meet the following additional requirements, except as noted elsewhere 
in this part:
    (a) Adjustable parameters. Vehicles that have adjustable parameters 
must meet all the requirements of this part for any adjustment in the 
physically adjustable range. We may require that you set adjustable 
parameters to any specification within the adjustable range during any 
testing. See 40 CFR 86.094-22 for information related to determining 
whether or not an operating parameter is considered adjustable. You 
must ensure safe vehicle operation throughout the physically adjustable 
range of each adjustable parameter, including consideration of 
production tolerances. Note that adjustable roof fairings and trailer 
rear fairings are deemed not to be adjustable parameters.
    (b) Prohibited controls. You may not design your vehicles with 
emission control devices, systems, or elements of design that cause or 
contribute to an unreasonable risk to public health, welfare, or safety 
while operating. For example, this would apply if the vehicle emits a 
noxious or toxic substance it would otherwise not emit that contributes 
to such an unreasonable risk.
    (c) [Reserved]
    (d) Defeat devices. 40 CFR 1068.101 prohibits the use of defeat 
devices.
    (e) Air conditioning leakage. Loss of refrigerant from your air 
conditioning systems may not exceed a total leakage rate of 11.0 grams 
per year or a percent leakage rate of 1.50 percent per year, whichever 
is greater. This applies for all refrigerants. Calculate the total 
leakage rate in g/year as specified in 40 CFR 86.1867-12(a). Calculate 
the percent leakage rate as: [total leakage rate (g/yr)] / [total 
refrigerant capacity (g)] x 100. Round your percent leakage rate to the

[[Page 74056]]

nearest one-hundredth of a percent. This paragraph (e) does not apply 
for refrigeration units on trailers; similarly, this paragraph (e) does 
not apply for self-contained air conditioning or refrigeration units on 
vocational vehicles even if they draw electrical power from engines 
used to propel the vehicles. For purposes of this requirement, 
``refrigerant capacity'' is the total mass of refrigerant recommended 
by the vehicle manufacturer as representing a full charge. Where full 
charge is specified as a pressure, use good engineering judgment to 
convert the pressure and system volume to a mass. If air conditioning 
systems with capacity above 3000 grams of refrigerant are designed such 
that a compliance demonstration under 40 CFR 86.1867-12(a) is 
impossible or impractical, you may ask to use alternative means to 
demonstrate that your air conditioning system achieves an equivalent 
level of control.


Sec.  1037.120  Emission-related warranty requirements.

    (a) General requirements. You must warrant to the ultimate 
purchaser and each subsequent purchaser that the new vehicle, including 
all parts of its emission control system, meets two conditions:
    (1) It is designed, built, and equipped so it conforms at the time 
of sale to the ultimate purchaser with the requirements of this part.
    (2) It is free from defects in materials and workmanship that cause 
the vehicle to fail to conform to the requirements of this part during 
the applicable warranty period.
    (b) Warranty period. (1) Your emission-related warranty must be 
valid for at least:
    (i) 5 years or 50,000 miles for Light HDV.
    (ii) 5 years or 100,000 miles for Medium HDV (except tires).
    (iii) 5 years for trailers (except tires).
    (iv) 1 year for tires installed on trailers, and 2 years or 24,000 
miles for all other tires.
    (2) You may offer an emission-related warranty more generous than 
we require. The emission-related warranty for the vehicle may not be 
shorter than any basic mechanical warranty you provide to that owner 
without charge for the vehicle. Similarly, the emission-related 
warranty for any component may not be shorter than any warranty you 
provide to that owner without charge for that component. This means 
that your warranty for a given vehicle may not treat emission-related 
and nonemission-related defects differently for any component. The 
warranty period begins when the vehicle is placed into service.
    (c) Components covered. The emission-related warranty covers tires, 
automatic tire inflation systems, tire pressure monitoring systems, 
vehicle speed limiters, idle-reduction systems, hybrid system 
components, and devices added to the vehicle to improve aerodynamic 
performance (not including standard components such as hoods or mirrors 
even if they have been optimized for aerodynamics), to the extent such 
emission-related components are included in your application for 
certification. The emission-related warranty also covers other added 
emission-related components to the extent they are included in your 
application for certification. The emission-related warranty covers all 
components whose failure would increase a vehicle's emissions of air 
conditioning refrigerants (for vehicles subject to air conditioning 
leakage standards), and it covers all components whose failure would 
increase a vehicle's evaporative emissions (for vehicles subject to 
evaporative emission standards). The emission-related warranty covers 
these components even if another company produces the component. Your 
emission-related warranty does not need to cover components whose 
failure would not increase a vehicle's emissions of any regulated 
pollutant.
    (d) Limited applicability. You may deny warranty claims under this 
section if the operator caused the problem through improper maintenance 
or use, as described in 40 CFR 1068.115. For example, it may be 
appropriate to require the seals on automatic tire inflation systems to 
be replaced during the warranty period.
    (e) Owners manual. Describe in the owners manual the emission-
related warranty provisions from this section that apply to the 
vehicle.


Sec.  1037.125  Maintenance instructions and allowable maintenance.

    Give the ultimate purchaser of each new vehicle written 
instructions for properly maintaining and using the vehicle, including 
the emission control system. The maintenance instructions also apply to 
service accumulation on any of your emission-data vehicles. See 
paragraph (i) of this section for requirements related to tire 
replacement.
    (a) Critical emission-related maintenance. Critical emission-
related maintenance includes any adjustment, cleaning, repair, or 
replacement of critical emission-related components. This may also 
include additional emission-related maintenance that you determine is 
critical if we approve it in advance. You may schedule critical 
emission-related maintenance on these components if you demonstrate 
that the maintenance is reasonably likely to be done at the recommended 
intervals on in-use vehicles. We will accept scheduled maintenance as 
reasonably likely to occur if you satisfy any of the following 
conditions:
    (1) You present data showing that, if a lack of maintenance 
increases emissions, it also unacceptably degrades the vehicle's 
performance.
    (2) You present survey data showing that at least 80 percent of 
vehicles in the field get the maintenance you specify at the 
recommended intervals.
    (3) You provide the maintenance free of charge and clearly say so 
in your maintenance instructions.
    (4) You otherwise show us that the maintenance is reasonably likely 
to be done at the recommended intervals.
    (b) Recommended additional maintenance. You may recommend any 
additional amount of maintenance on the components listed in paragraph 
(a) of this section, as long as you state clearly that these 
maintenance steps are not necessary to keep the emission-related 
warranty valid. If operators do the maintenance specified in paragraph 
(a) of this section, but not the recommended additional maintenance, 
this does not allow you to disqualify those vehicles from in-use 
testing or deny a warranty claim. Do not take these maintenance steps 
during service accumulation on your emission-data vehicles.
    (c) Special maintenance. You may specify more frequent maintenance 
to address problems related to special situations, such as atypical 
vehicle operation. You must clearly state that this additional 
maintenance is associated with the special situation you are 
addressing. We may disapprove your maintenance instructions if we 
determine that you have specified special maintenance steps to address 
vehicle operation that is not atypical, or that the maintenance is 
unlikely to occur in use. If we determine that certain maintenance 
items do not qualify as special maintenance under this paragraph (c), 
you may identify this as recommended additional maintenance under 
paragraph (b) of this section.
    (d) Noncritical emission-related maintenance. Subject to the 
provisions of this paragraph (d), you may schedule any amount of 
emission-related inspection or maintenance that is not covered by 
paragraph (a) of this section

[[Page 74057]]

(that is, maintenance that is neither explicitly identified as critical 
emission-related maintenance, nor that we approve as critical emission-
related maintenance). Noncritical emission-related maintenance 
generally includes maintenance on the components we specify in 40 CFR 
part 1068, Appendix I, that is not covered in paragraph (a) of this 
section. You must state in the owners manual that these steps are not 
necessary to keep the emission-related warranty valid. If operators 
fail to do this maintenance, this does not allow you to disqualify 
those vehicles from in-use testing or deny a warranty claim. Do not 
take these inspection or maintenance steps during service accumulation 
on your emission-data vehicles.
    (e) Maintenance that is not emission-related. For maintenance 
unrelated to emission controls, you may schedule any amount of 
inspection or maintenance. You may also take these inspection or 
maintenance steps during service accumulation on your emission-data 
vehicles, as long as they are reasonable and technologically necessary. 
You may perform this nonemission-related maintenance on emission-data 
vehicles at the least frequent intervals that you recommend to the 
ultimate purchaser (but not the intervals recommended for severe 
service).
    (f) Source of parts and repairs. State clearly in your written 
maintenance instructions that a repair shop or person of the owner's 
choosing may maintain, replace, or repair emission control devices and 
systems. Your instructions may not require components or service 
identified by brand, trade, or corporate name. Also, do not directly or 
indirectly condition your warranty on a requirement that the vehicle be 
serviced by your franchised dealers or any other service establishments 
with which you have a commercial relationship. You may disregard the 
requirements in this paragraph (f) if you do one of two things:
    (1) Provide a component or service without charge under the 
purchase agreement.
    (2) Get us to waive this prohibition in the public's interest by 
convincing us the vehicle will work properly only with the identified 
component or service.
    (g) [Reserved]
    (h) Owners manual. Explain the owner's responsibility for proper 
maintenance in the owners manual.
    (i) Tire maintenance and replacement. Include instructions that 
will enable the owner to replace tires so that the vehicle conforms to 
the original certified vehicle configuration.


Sec.  1037.130  Assembly instructions for secondary vehicle 
manufacturers.

    (a) If you sell a certified incomplete vehicle to a secondary 
vehicle manufacturer, give the secondary vehicle manufacturer 
instructions for completing vehicle assembly consistent with the 
requirements of this part. Include all information necessary to ensure 
that the final vehicle assembly (including the engine for vehicles 
other than trailers) will be in its certified configuration.
    (b) Make sure these instructions have the following information:
    (1) Include the heading: ``Emission-related installation 
instructions''.
    (2) State: ``Failing to follow these instructions when completing 
assembly of a heavy-duty motor vehicle violates federal law, subject to 
fines or other penalties as described in the Clean Air Act.''
    (3) Describe the necessary steps for installing any diagnostic 
system required under 40 CFR part 86.
    (4) Describe how your certification is limited for any type of 
application, as illustrated in the following examples:
    (i) If the incomplete vehicle is at or below 8,500 pounds GVWR, 
state that the vehicle's certification is valid under this part 1037 
only if the final configuration has a vehicle curb weight above 6,000 
pounds or basic vehicle frontal area above 45 square feet.
    (ii) If your engine will be installed in a vehicle that you certify 
to meet diurnal emission standards using an evaporative canister, but 
you do not install the fuel tank, identify the maximum permissible fuel 
tank capacity.
    (5) Describe any other instructions to make sure the vehicle will 
operate according to design specifications in your application for 
certification.
    (c) Provide instructions in writing or in an equivalent format. You 
may include this information with the incomplete vehicle document 
required by DOT. If you do not provide the instructions in writing, 
explain in your application for certification how you will ensure that 
each installer is informed of the installation requirements.


Sec.  1037.135  Labeling.

    (a) Assign each vehicle a unique identification number and 
permanently affix, engrave, or stamp it on the vehicle in a legible 
way. The vehicle identification number (VIN) serves this purpose.
    (b) At the time of manufacture, affix a permanent and legible label 
identifying each vehicle. The label must meet the requirements of 40 
CFR 1068.45.
    (c) The label must--
    (1) Include the heading ``VEHICLE EMISSION CONTROL INFORMATION''.
    (2) Include your full corporate name and trademark. You may 
identify another company and use its trademark instead of yours if you 
comply with the branding provisions of 40 CFR 1068.45.
    (3) Include EPA's standardized designation for the vehicle family.
    (4) State the regulatory subcategory that determines the applicable 
emission standards for the vehicle family (see definition in Sec.  
1037.801).
    (5) State the date of manufacture [DAY (optional), MONTH, and 
YEAR]. You may omit this from the label if you stamp, engrave, or 
otherwise permanently identify it elsewhere on the vehicle, in which 
case you must also describe in your application for certification where 
you will identify the date on the vehicle.
    (6) Identify the emission control system. Use terms and 
abbreviations as described in Appendix III to this part or other 
applicable conventions. Phase 2 tractors and Phase 2 vocational 
vehicles may omit this information.
    (7) Identify any requirements for fuel and lubricants that do not 
involve fuel-sulfur levels.
    (8) State: ``THIS VEHICLE COMPLIES WITH U.S. EPA REGULATIONS FOR 
[MODEL YEAR] HEAVY-DUTY VEHICLES.''
    (9) If you rely on another company to design and install fuel tanks 
in incomplete vehicles that use an evaporative canister for controlling 
diurnal emissions, include the following statement: ``THIS VEHICLE IS 
DESIGNED TO COMPLY WITH EVAPORATIVE EMISSION STANDARDS WITH UP TO x 
GALLONS OF FUEL TANK CAPACITY.'' Complete this statement by identifying 
the maximum specified fuel tank capacity associated with your 
certification.
    (d) You may add information to the emission control information 
label as follows:
    (1) You may identify other emission standards that the vehicle 
meets or does not meet (such as European standards).
    (2) You may add other information to ensure that the vehicle will 
be properly maintained and used.
    (3) You may add appropriate features to prevent counterfeit labels. 
For example, you may include the vehicle's unique identification number 
on the label.

[[Page 74058]]

    (e) You may ask us to approve modified labeling requirements in 
this part 1037 if you show that it is necessary or appropriate. We will 
approve your request if your alternate label is consistent with the 
requirements of this part.


Sec.  1037.140  Classifying vehicles and determining vehicle 
parameters.

    (a) Where applicable, a vehicle's roof height and a trailer's 
length are determined from nominal design specifications, as provided 
in this section. Specify design values for roof height and trailer 
length to the nearest inch.
    (b) Base roof height on fully inflated tires having a static loaded 
radius equal to the arithmetic mean of the largest and smallest static 
loaded radius of tires you offer or a standard tire we approve.
    (c) Base trailer length on the outer dimensions of the load-
carrying structure. Do not include aerodynamic devices or HVAC units.
    (d) The nominal design specifications must be within the range of 
the actual values from production vehicles considering normal 
production variability. In the case of roof height, use the mean tire 
radius specified in paragraph (b) of this section. If after production 
begins it is determined that your nominal design specifications do not 
represent production vehicles, we may require you to amend your 
application for certification under Sec.  1037.225.
    (e) If your vehicle is equipped with an adjustable roof fairing, 
measure the roof height with the fairing in its lowest setting.
    (f) For any provisions in this part that depend on the number of 
axles on a vehicle, include lift axles or any other installed axles 
that can be used to carry the vehicle's weight while in motion.
    (g) The standards and other provisions of this part apply to 
specific vehicle service classes for tractors and vocational vehicles 
as follows:
    (1) Phase 1 and Phase 2 tractors are divided based on GVWR into 
Class 7 tractors and Class 8 tractors. Where provisions apply to both 
tractors and vocational vehicles, Class 7 tractors are considered 
``Medium HDV'' and Class 8 tractors are considered ``Heavy HDV''.
    (2) Phase 1 vocational vehicles are divided based on GVWR. ``Light 
HDV'' includes Class 2b through Class 5 vehicles; ``Medium HDV includes 
Class 6 and Class 7 vehicles; and ``Heavy HDV includes Class 8 
vehicles.
    (3) Phase 2 vocational vehicles with spark-ignition engines are 
divided based on GVWR. ``Light HDV'' includes Class 2b through Class 5 
vehicles, and ``Medium HDV includes Class 6 through Class 8 vehicles.
    (4) Phase 2 vocational vehicles with compression-ignition engines 
are divided as follows:
    (i) Class 2b through Class 5 vehicles are considered ``Light HDV''.
    (ii) Class 6 through 8 vehicles are considered ``Heavy HDV'' if the 
installed engine's primary intended service class is heavy heavy-duty 
(see 40 CFR 1036.140). All other Class 6 through Class 8 vehicles are 
considered ``Medium HDV''.
    (5) In certain circumstances, you may certify vehicles to standards 
that apply for a different vehicle service class. For example, see 
Sec. Sec.  1037.105(g) and 1037.106(f). If you optionally certify 
vehicles to different standards, those vehicles are subject to all the 
regulatory requirements as if the standards were mandatory.
    (h) Use good engineering judgment to identify the intended duty 
cycle (Urban, Multi-Purpose, or Regional) for each of your vocational 
vehicle configurations based on the expected use of the vehicles.


Sec.  1037.150  Interim provisions.

    The provisions in this section apply instead of other provisions in 
this part.
    (a) Incentives for early introduction. The provisions of this 
paragraph (a) apply with respect to tractors and vocational vehicles 
produced in model years before 2014. Manufacturers may voluntarily 
certify in model year 2013 (or earlier model years for electric 
vehicles) to the greenhouse gas standards of this part.
    (1) This paragraph (a)(1) applies for regulatory subcategories 
subject to the standards of Sec.  1037.105 or Sec.  1037.106. Except as 
specified in paragraph (a)(3) of this section, to generate early 
credits under this paragraph for any vehicles other than electric 
vehicles, you must certify your entire U.S.-directed production volume 
within the regulatory subcategory to these standards. Except as 
specified in paragraph (a)(4) of this section, if some vehicle families 
within a regulatory subcategory are certified after the start of the 
model year, you may generate credits only for production that occurs 
after all families are certified. For example, if you produce three 
vehicle families in an averaging set and you receive your certificates 
for those families on January 4, 2013, March 15, 2013, and April 24, 
2013, you may not generate credits for model year 2013 production in 
any of the families that occurs before April 24, 2013. Calculate 
credits relative to the standard that would apply in model year 2014 
using the equations in subpart H of this part. You may bank credits 
equal to the surplus credits you generate under this paragraph (a) 
multiplied by 1.50. For example, if you have 1.0 Mg of surplus credits 
for model year 2013, you may bank 1.5 Mg of credits. Credit deficits 
for an averaging set prior to model year 2014 do not carry over to 
model year 2014. These credits may be used to show compliance with the 
standards of this part for 2014 and later model years. We recommend 
that you notify EPA of your intent to use this provision before 
submitting your applications.
    (2) [Reserved]
    (3) You may generate emission credits for the number of additional 
SmartWay designated tractors (relative to your 2012 production), 
provided you do not generate credits for those vehicles under paragraph 
(a)(1) of this section. Calculate credits for each regulatory 
subcategory relative to the standard that would apply in model year 
2014 using the equations in subpart H of this part. Use a production 
volume equal to the number of designated model year 2013 SmartWay 
tractors minus the number of designated model year 2012 SmartWay 
tractors. You may bank credits equal to the surplus credits you 
generate under this paragraph (a)(3) multiplied by 1.50. Your 2012 and 
2013 model years must be equivalent in length.
    (4) This paragraph (a)(4) applies where you do not receive your 
final certificate in a regulatory subcategory within 30 days of 
submitting your final application for that subcategory. Calculate your 
credits for all production that occurs 30 days or more after you submit 
your final application for the subcategory.
    (b) Phase 1 coastdown procedures. For tractors subject to Phase 1 
standards under Sec.  1037.106, the default method for measuring drag 
area (CdA) is the coastdown procedure specified in 40 CFR 
part 1066, subpart D. This includes preparing the tractor and the 
standard trailer with wheels meeting specifications of Sec.  
1037.528(b) and submitting information related to your coastdown 
testing under Sec.  1037.528(h).
    (c) Provisions for small manufacturers. Standards apply on a 
delayed schedule for manufacturers meeting the small business criteria 
specified in 13 CFR 121.201. Apply the small business criteria for 
NAICS code 336120 for vocational vehicles and tractors and 336212 for 
trailers; the employee limits apply to the total number employees 
together for affiliated companies. Qualifying small manufacturers are 
not subject to the greenhouse gas standards of Sec. Sec.  1037.105 and 
1037.106 for vehicles with a date of

[[Page 74059]]

manufacture before January 1, 2022, Similarly, qualifying small 
manufacturers are not subject to the greenhouse gas standards of Sec.  
1037.107 for trailers with a date of manufacture before January 1, 
2019. In addition, qualifying small manufacturers producing vehicles 
that run on any fuel other than gasoline, E85, or diesel fuel may delay 
complying with every later standard under this part by one model year. 
Qualifying manufacturers must notify the Designated Compliance Officer 
each model year before introducing these excluded vehicles into U.S. 
commerce. This notification must include a description of the 
manufacturer's qualification as a small business under 13 CFR 121.201. 
You must label your excluded vehicles with the following statement: 
``THIS VEHICLE IS EXCLUDED UNDER 40 CFR 1037.150(c).'' Small 
manufacturers may certify their vehicles under this part 1037 before 
standards start to apply; however, they may generate emission credits 
only if they certify their entire U.S.-directed production volume 
within the applicable averaging set for that model year.
    (d) Air conditioning leakage for vocational vehicles. The air 
conditioning leakage standard of Sec.  1037.115 does not apply for 
model year 2020 and earlier vocational vehicles.
    (e) Delegated assembly. The delegated-assembly provisions of Sec.  
1037.621 do not apply before January 1, 2018.
    (f) Electric vehicles. Tailpipe emissions of regulated pollutants 
from electric vehicles (as defined in Sec.  1037.801) are deemed to be 
zero. No emission testing is required for electric vehicles. Use good 
engineering judgment to apply other requirements of this part to 
electric vehicles.
    (g) Compliance date. Compliance with the standards of this part was 
optional prior to January 1, 2014. This means that if your 2014 model 
year begins before January 1, 2014, you may certify for a partial model 
year that begins on January 1, 2014 and ends on the day your model year 
would normally end. You must label model year 2014 vehicles excluded 
under this paragraph (g) with the following statement: ``THIS VEHICLE 
IS EXCLUDED UNDER 40 CFR 1037.150(g).''
    (h) Off-road vehicle exemption. (1) Vocational vehicles with a date 
of manufacture before January 1, 2021 automatically qualify for an 
exemption under Sec.  1037.631 if the tires installed on the vehicle 
have a maximum speed rating at or below 55 miles per hour.
    (2) In unusual circumstances, vehicle manufacturers may ask us to 
exempt vehicles under Sec.  1037.631 based on other criteria that are 
equivalent to those specified in Sec.  1037.631(a); however, we will 
normally not grant relief in cases where the vehicle manufacturer has 
credits or can otherwise comply with applicable standards. Request 
approval for an exemption under this paragraph (h) before you produce 
the subject vehicles. Send your request with supporting information to 
the Designated Compliance Officer; we will coordinate with NHTSA in 
making a determination under Sec.  1037.210. If you introduce into U.S. 
commerce vehicles that depend on our approval under this paragraph (h) 
before we inform you of our approval, those vehicles violate 40 CFR 
1068.101(a)(1).
    (i) Limited carryover from Phase 1 to Phase 2. The provisions for 
carryover data in Sec.  1037.235(d) do not allow you to use aerodynamic 
test results from Phase 1 to support a compliance demonstration for 
Phase 2 certification.
    (j) Limited prohibition related to early model year engines. The 
provisions of this paragraph (j) apply only for vehicles that have a 
date of manufacture before January 1, 2018. See Sec.  1037.635 for 
related provisions that apply in later model years. The prohibition in 
Sec.  1037.601 against introducing into U.S. commerce a vehicle 
containing an engine not certified to the standards applicable for the 
calendar year of installation does not apply for vehicles using model 
year 2014 or 2015 spark-ignition engines, or any model year 2013 or 
earlier engines.
    (k) Verifying drag areas from in-use tractors. This paragraph (k) 
applies for tractors instead of Sec.  1037.401(b) through model year 
2020. We may measure the drag area of your vehicles after they have 
been placed into service. To account for measurement variability, your 
vehicle is deemed to conform to the regulations of this part with 
respect to aerodynamic performance if we measure its drag area to be at 
or below the maximum drag area allowed for the bin above the bin to 
which you certified (for example, Bin II if you certified the vehicle 
to Bin III), unless we determine that you knowingly produced the 
vehicle to have a higher drag area than is allowed for the bin to which 
it was certified.
    (l) Optional sister-vehicle certification under 40 CFR part 86. You 
may certify certain complete or cab-complete vehicles to the GHG 
standards of 40 CFR 86.1819 instead of the standards of Sec.  1037.105 
as specified in 40 CFR 86.1819-14(j).
    (m) Loose engine sales. Manufacturers may certify certain spark-
ignition engines along with chassis-certified heavy-duty vehicles where 
they are identical to engines used in those vehicles as described in 40 
CFR 86.1819-14(k)(8). Vehicles in which those engines are installed are 
subject to standards under this part as specified in Sec.  1037.105.
    (n) Transition to engine-based model years. The following 
provisions apply for production and ABT reports during the transition 
to engine-based model year determinations for tractors and vocational 
vehicles in 2020 and 2021:
    (1) If you install model year 2020 or earlier engines in your 
vehicles in calendar year 2020, include all those Phase 1 vehicles in 
your production and ABT reports related to model year 2020 compliance, 
although we may require you identify these separately from vehicles 
produced in calendar year 2019.
    (2) If you install model year 2020 engines in your vehicles in 
calendar year 2021, submit production and ABT reports for those Phase 1 
vehicles separate from the reports you submit for Phase 2 vehicles with 
model year 2021 engines.
    (o) Interim useful life for light heavy-duty vocational vehicles. 
Class 2b through Class 5 vocational vehicles certified to Phase 1 
standards are subject to a useful life of 110,000 miles or 10 years, 
whichever comes first, instead of the useful life specified in Sec.  
1037.105. For emission credits generated from these Phase 1 vehicles, 
multiply any banked credits that you carry forward to demonstrate 
compliance with Phase 2 standards by 1.36.
    (p) Credit multiplier for advanced technology. If you generate 
credits from Phase 1 vehicles certified with advanced technology, you 
may multiply these credits by 1.50, except that you may not apply this 
multiplier in addition to the early-credit multiplier of paragraph (a) 
of this section. If you generate credits from model year 2027 and 
earlier Phase 2 vehicles certified with advanced technology, you may 
multiply these credits by 3.5 for plug-in hybrid electric vehicles, 4.5 
for electric vehicles, and 5.5 for fuel cell vehicles.
    (q) Vehicle families for advanced and off-cycle technologies. Apply 
the following provisions for grouping vehicles into families if you use 
off-cycle technologies under Sec.  1037.610 or advanced technologies 
under Sec.  1037.615:
    (1) For vocational vehicles and tractors subject to Phase 1 
standards, create separate vehicle families for vehicles that contain 
advanced or off-

[[Page 74060]]

cycle technologies; group those vehicles together in a vehicle family 
if they use the same advanced or off-cycle technologies.
    (2) For vocational vehicles and tractors subject to Phase 2 
standards, create separate vehicle families if there is a credit 
multiplier for advanced technology; group those vehicles together in a 
vehicle family if they use the same multiplier.
    (r) Conversion to mid- roof and high-roof configurations. Secondary 
vehicle manufacturers that qualify as small manufacturers may convert 
low- and mid-roof tractors to mid- and high-roof configurations without 
recertification for the purpose of building a custom sleeper tractor or 
converting it to run on natural gas, as follows:
    (1) The original low- or mid-roof tractor must be covered by a 
valid certificate of conformity.
    (2) The modifications may not increase the frontal area of the 
tractor beyond the frontal area of the equivalent mid- or high-roof 
tractor with the corresponding standard trailer. Note that these 
dimensions have a tolerance of 2 inches. Use good 
engineering judgment to achieve aerodynamic performance similar to or 
better than the certifying manufacturer's corresponding mid- or high-
roof tractor.
    (3) Add a permanent supplemental label to the vehicle near the 
original manufacturer's emission control information label. On the 
label identify your full corporate name and include the following 
statement: ``THIS VEHICLE WAS MODIFIED AS ALLOWED UNDER 40 CFR 
1037.150.''
    (4) We may require that you submit annual production reports as 
described in Sec.  1037.250.
    (5) Modifications made under this paragraph (r) do not violate 40 
CFR 1068.101(b)(1).
    (s) Confirmatory testing for Falt-aero. If we conduct 
coastdown testing to verify your Falt-aero value for Phase 2 
tractors, we will make our determination using a statistical analysis 
consistent with the principles of SEA testing in Sec.  1037.305. We 
will calculate confidence intervals using the same equations and will 
not replace your test results with ours if your result falls within our 
confidence interval or is greater than our test result.
    (t) Glider kits and glider vehicles. (1) Glider vehicles conforming 
to the requirements in this paragraph (t)(1) are exempt from the Phase 
1 emission standards of this part 1037 prior to January 1, 2021. 
Engines in such vehicles (including vehicles produced after January 1, 
2021) remain subject to the requirements of 40 CFR part 86 applicable 
for the engines' original model year, but not subject to the Phase 1 or 
Phase 2 standards of 40 CFR part 1036 unless they were originally 
manufactured in model year 2014 or later.
    (i) You are eligible for this exemption if you are a small 
manufacturer and you sold one or more glider vehicles in 2014 under the 
provisions of Sec.  1037.150(c). You do not qualify if you only 
produced glider vehicles for your own use. You must notify us of your 
plans to use this exemption before you introduce exempt vehicles into 
U.S. commerce. In your notification, you must identify your annual 
U.S.-directed production volume (and sales, if different) of such 
vehicles for calendar years 2010 through 2014. Vehicles you produce 
before notifying us are not exempt under this section.
    (ii) In a given calendar year, you may produce up to 300 exempt 
vehicles under this section, or up to the highest annual production 
volume you identify in paragraph (t)(1) of this section, whichever is 
less.
    (iii) Identify the number of exempt vehicles you produced under 
this exemption for the preceding calendar year in your annual report 
under Sec.  1037.250.
    (iv) Include the appropriate statement on the label required under 
Sec.  1037.135, as follows:
    (A) For Phase 1 vehicles, ``THIS VEHICLE AND ITS ENGINE ARE EXEMPT 
UNDER 40 CFR 1037.150(t)(1).''
    (B) For Phase 2 vehicles, ``THE ENGINE IN THIS VEHICLE IS EXEMPT 
UNDER 40 CFR 1037.150(t)(1).''
    (v) If you produce your glider vehicle by installing remanufactured 
or previously used components in a glider kit produced by another 
manufacturer, you must provide the following to the glider kit 
manufacturer prior to obtaining the glider kit:
    (A) Your name, the name of your company, and contact information.
    (B) A signed statement that you are a qualifying small manufacturer 
and that your production will not exceed the production limits of this 
paragraph (t)(1). This statement is deemed to be a submission to EPA, 
and we may require the glider kit manufacturer to provide a copy to us 
at any time.
    (vi) This exemption is valid for a given vehicle and engine only if 
you meet all the requirements and conditions of this paragraph (t)(1) 
that apply with respect to that vehicle and engine. Introducing such a 
vehicle into U.S. commerce without meeting all applicable requirements 
and conditions violates 40 CFR 1068.101(a)(1).
    (vii) Companies that are not small manufacturers may sell 
uncertified incomplete vehicles without engines to small manufacturers 
for the purpose of producing exempt vehicles under this paragraph 
(t)(1), subject to the provisions of Sec.  1037.622. However, such 
companies must take reasonable steps to ensure that their incomplete 
vehicles will be used in conformance with the requirements of this part 
1037.
    (2) Glider vehicles produced using engines certified to model year 
2010 or later standards for all pollutants are subject to the same 
provisions that apply to vehicles using engines within their useful 
life in Sec.  1037.635.
    (3) For calendar year 2017, you may produce a limited number of 
glider kits and/or glider vehicles subject to the requirements 
applicable to model year 2016 glider vehicles, instead of the 
requirements of Sec.  1037.635. The limit applies to your combined 2017 
production of glider kits and glider vehicles and is equal to your 
highest annual production of glider kits and glider vehicles for any 
year from 2010 to 2014. Any glider kits or glider vehicles produced 
beyond this cap are subject to the provisions of Sec.  1037.635. Count 
any glider kits and glider vehicles you produce under paragraph (t)(1) 
of this section as part of your production with respect to this 
paragraph (t)(3).
    (u) Streamlined preliminary approval for trailer devices. Before 
January 1, 2018, manufacturers of aerodynamic devices for trailers may 
ask for preliminary EPA approval of compliance data for their devices 
based on qualifying for designation under the SmartWay program based on 
measured CdA values, whether or not that involves testing or 
other methods specified in Sec.  1037.526. Trailer manufacturers may 
certify based on [Delta]CdA values established under this 
paragraph (u) through model year 2020. Manufacturers must perform 
testing as specified in subpart F of this part for any vehicles or 
aerodynamic devices not qualifying for approval under this paragraph 
(u).
    (v) Transitional allowances for trailers. Through model year 2026, 
trailer manufacturers may calculate a number of trailers that are 
exempt from the standards and certification requirements of this part. 
Calculate the number of exempt box vans in a given model year by 
multiplying your total U.S.-directed production volume of certified box 
vans by 0.20 and rounding to the nearest whole number; however, in no 
case may the number of exempted box vans be greater than 350 units in 
any given model year. Repeat this calculation to determine the number 
of non-box trailers, up to 250 annual units, that are exempt from 
standards and certification requirements. Perform the

[[Page 74061]]

calculation based on your projected production volumes in the first 
year that standards apply; in later years, use actual production 
volumes from the preceding model year. Include these calculated values 
and your production volumes of exempt trailers in your annual 
production report under Sec.  1037.250. You must apply a label meeting 
the requirements of 40 CFR 1068.45(a) that identifies your corporate 
name and states that the trailer is exempt under the provisions of 
Sec.  1037.150. Unlabeled trailers will be considered in violation of 
40 CFR 1068.101(a)(1).
    (w) Roll-up doors for non-aero box vans. Through model year 2023, 
box vans may qualify for non-aero or partial-aero standards under Sec.  
1037.107 by treating roll-up rear doors as being equivalent to rear 
lift gates.
    (x) Aerodynamic testing for trailers. Section 1037.526 generally 
requires you to adjust [Delta]CdA values from alternate test 
methods to be equivalent to measurements with the primary test method. 
This paragraph (x) describes approximations that we believe are 
consistent with good engineering judgment; however, you may not use 
these approximations where we determine that clear and convincing 
evidence shows that they would significantly overestimate actual 
improvements in aerodynamic performance.
    (1) You may presume that CFD measurements at a yaw angle of 
4.5[deg] are equal to measurements made using the primary method, and 
you may use them without adjustment.
    (2) You may presume that coastdown measurements at yaw angles 
smaller than  4.5[deg] are equal to measurements made using 
the primary method, and you may use them without adjustment. This 
applies equally for device manufacturers, but it does not apply for EPA 
testing.
    (3) You may use testing or analytical methods to adjust coastdown 
measurements to account for aerodynamic effects at a yaw angle of 
4.5[deg]. This applies for rear fairings and other devices 
whose performance is affected by yaw angle.
    (y) Transition to Phase 2 standards. The following provisions allow 
for enhanced generation and use of emission credits from Phase 1 
tractors and vocational vehicles for meeting the Phase 2 standards:
    (1) For vocational Light HDV and vocational Medium HDV, emission 
credits you generate in model years 2018 through 2021 may be used 
through model year 2027, instead of being limited to a five-year credit 
life as specified in Sec.  1037.740(c). For Class 8 vocational vehicles 
with medium heavy-duty engines, we will approve your request to 
generate these credits in and use these credits for the Medium HDV 
averaging set if you show that these vehicles would qualify as Medium 
HDV under the Phase 2 program as described in Sec.  1037.140(g)(4).
    (2) You may use the off-cycle provisions of Sec.  1037.610 to apply 
technologies to Phase 1 vehicles as follows:
    (i) You may apply an improvement factor of 0.988 for tractors and 
vocational vehicles with automatic tire inflation systems on all axles.
    (ii) For vocational vehicles with automatic engine shutdown systems 
that conform with Sec.  1037.660, you may apply an improvement factor 
of 0.95.
    (iii) For vocational vehicles with stop-start systems that conform 
with Sec.  1037.660, you may apply an improvement factor of 0.92.
    (iv) For vocational vehicles with neutral-idle systems conforming 
with Sec.  1037.660, you may apply an improvement factor of 0.98. You 
may adjust this improvement factor if we approve a partial reduction 
under Sec.  1037.660(a)(2); for example, if your design reduces fuel 
consumption by half as much as shifting to neutral, you may apply an 
improvement factor of 0.99.
    (3) Small manufacturers may generate emission credits for natural 
gas-fueled vocational vehicles as follows:
    (i) Small manufacturers may certify their vehicles instead of 
relying on the exemption of paragraph (c) of this section. The 
provisions of this part apply for such vehicles, except as specified in 
this paragraph (y)(3).
    (ii) Use Phase 1 GEM to determine a CO2 emission level 
for your vehicle, then multiply this value by the engine's FCL for 
CO2 and divide by the engine's applicable CO2 
emission standard.
    (z) Constraints for vocational duty cycles. The following 
provisions apply to determinations of vocational duty cycles as 
described in Sec.  1037.140:
    (1) The Regional duty cycle applies if the engine was certified 
based on testing only with the ramped-modal cycle.
    (2) The Regional duty cycle applies for coach buses and motor homes 
you certify under Sec.  1037.105(b).
    (3) You may not select the Urban duty cycle for any vehicle with a 
manual or single-clutch automated manual transmission.
    (4) Starting in model year 2024, you must select the Regional duty 
cycle for any vehicle with a manual transmission.
    (5) You may select the Urban duty cycle for a hybrid vehicle 
equipped with regenerative braking, unless it is equipped with a manual 
transmission.
    (6) You may select the Urban duty cycle for any vehicle with a 
hydrokinetic torque converter paired with an automatic transmission, or 
a continuously variable automatic transmission, or a dual-clutch 
transmission with no more than two consecutive forward gears between 
which it is normal for both clutches to be momentarily disengaged.
    (aa) Custom-chassis standards. The following provisions apply 
uniquely to small manufacturers under the custom-chassis standards of 
Sec.  1037.105(h):
    (1) You may use emission credits generated under Sec.  1037.105(d), 
including banked or traded credits from any averaging set. Such credits 
remain subject to other limitations that apply under subpart H of this 
part.
    (2) You may produce up to 200 drayage tractors in a given model 
year to the standards described in Sec.  1037.105(h) for ``other 
buses''. Treat these drayage tractors as being in their own averaging 
set.

Subpart C--Certifying Vehicle Families


Sec.  1037.201  General requirements for obtaining a certificate of 
conformity.

    (a) You must send us a separate application for a certificate of 
conformity for each vehicle family. A certificate of conformity is 
valid from the indicated effective date until the end of the model year 
for which it is issued. You must renew your certification annually for 
any vehicles you continue to produce.
    (b) The application must contain all the information required by 
this part and must not include false or incomplete statements or 
information (see Sec.  1037.255).
    (c) We may ask you to include less information than we specify in 
this subpart, as long as you maintain all the information required by 
Sec.  1037.250.
    (d) You must use good engineering judgment for all decisions 
related to your application (see 40 CFR 1068.5).
    (e) An authorized representative of your company must approve and 
sign the application.
    (f) See Sec.  1037.255 for provisions describing how we will 
process your application.
    (g) We may perform confirmatory testing on your vehicles or 
components; for example, we may test vehicles to verify drag areas or 
other GEM inputs. This includes tractors used to determine 
Falt-aero under Sec.  1037.525. We may require you to 
deliver your test vehicles or components to a facility we designate for 
our testing. Alternatively, you may

[[Page 74062]]

choose to deliver another vehicle or component that is identical in all 
material respects to the test vehicle or component, or a different 
vehicle or component that we determine can appropriately serve as an 
emission-data vehicle for the family. We may perform confirmatory 
testing on engines under 40 CFR part 1036 and may require you to apply 
modified fuel maps from that testing for certification under this part.
    (h) The certification and testing provisions of 40 CFR part 86, 
subpart S, apply instead of the provisions of this subpart relative to 
the evaporative and refueling emission standards specified in Sec.  
1037.103, except that Sec.  1037.245 describes how to demonstrate 
compliance with evaporative emission standards. For vehicles that do 
not use an evaporative canister for controlling diurnal emissions, you 
may certify with respect to exhaust emissions and use the provisions of 
Sec.  1037.622 to let a different company certify with respect to 
evaporative emissions.
    (i) Vehicles and installed engines must meet exhaust, evaporative, 
and refueling emission standards and certification requirements in 40 
CFR part 86 or 40 CFR part 1036, as applicable. Include the information 
described in 40 CFR part 86, subpart S, or 40 CFR 1036.205 in your 
application for certification in addition to what we specify in Sec.  
1037.205 so we can issue a single certificate of conformity for all the 
requirements that apply for your vehicle and the installed engine.


Sec.  1037.205  What must I include in my application?

    This section specifies the information that must be in your 
application, unless we ask you to include less information under Sec.  
1037.201(c). We may require you to provide additional information to 
evaluate your application. References to testing and emission-data 
vehicles refer to testing vehicles or components to measure any 
quantity that serves as an input value for modeling emission rates 
under Sec.  1037.515 or 1037.520.
    (a) Describe the vehicle family's specifications and other basic 
parameters of the vehicle's design and emission controls. List the fuel 
type on which your vocational vehicles and tractors are designed to 
operate (for example, ultra-low-sulfur diesel fuel).
    (b) Explain how the emission control system operates. As 
applicable, describe in detail all system components for controlling 
greenhouse gas emissions, including all auxiliary emission control 
devices (AECDs) and all fuel-system components you will install on any 
production vehicle. Identify the part number of each component you 
describe. For this paragraph (b), treat as separate AECDs any devices 
that modulate or activate differently from each other. Also describe 
your modeling inputs as described in Sec. Sec.  1037.515 and 1037.520, 
with the following additional information if it applies for your 
vehicles:
    (1) Describe your design for vehicle speed limiters, consistent 
with Sec.  1037.640.
    (2) Describe your design for predictive cruise control.
    (3) Describe your design for automatic engine shutdown systems, 
consistent with Sec.  1037.660.
    (4) Describe your engineering analysis demonstrating that your air 
conditioning compressor qualifies as a high-efficiency model as 
described in 40 CFR 86.1868-12(h)(5).
    (5) Describe your design for idle-reduction technology, including 
the logic for engine shutdown and the maximum duration of engine 
operation after the onset of any vehicle conditions described in Sec.  
1037.660.
    (6) If you perform powertrain testing under Sec.  1037.550, report 
both CO2 and NOX emission levels corresponding to 
each test run.
    (7) Describe the configuration and basic design of hybrid systems. 
Include measurements for vehicles with hybrid power take-off systems.
    (8) If you install auxiliary power units in tractors under Sec.  
1037.106(g), identify the family name associated with the engine's 
certification under 40 CFR part 1039. Starting in model year 2024, also 
identify the family name associated with the auxiliary power unit's 
certification to the standards of 40 CFR 1039.699.
    (9) Describe how you meet any applicable criteria in Sec.  
1037.631(a)(1) and (2).
    (c) For vehicles subject to air conditioning standards, include:
    (1) The refrigerant leakage rates (leak scores).
    (2) The type of refrigerant and the refrigerant capacity of the air 
conditioning systems.
    (3) The corporate name of the final installer of the air 
conditioning system.
    (d) Describe any vehicles or components you selected for testing 
and the reasons for selecting them.
    (e) Describe any test equipment and procedures that you used, 
including any special or alternate test procedures you used (see Sec.  
1037.501). Include information describing the procedures you used to 
determine CdA values as specified in Sec. Sec.  1037.525 
through 1037.527. Describe which type of data you are using for engine 
fuel maps (see 40 CFR 1036.510). If your trailer certification relies 
on approved data from device manufacturers, identify the device and 
device manufacturer.
    (f) Describe how you operated any emission-data vehicle before 
testing, including the duty cycle and the number of vehicle operating 
miles used to stabilize emission-related performance. Explain why you 
selected the method of service accumulation. Describe any scheduled 
maintenance you did.
    (g) Where applicable, list the specifications of any test fuel to 
show that it falls within the required ranges we specify in 40 CFR part 
1065.
    (h) Identify the vehicle family's useful life.
    (i) Include the maintenance instructions and warranty statement you 
will give to the ultimate purchaser of each new vehicle (see Sec. Sec.  
1037.120 and 1037.125).
    (j) Describe your emission control information label (see Sec.  
1037.135).
    (k) Identify the emission standards or FELs to which you are 
certifying vehicles in the vehicle family. For families containing 
multiple subfamilies, this means that you must identify the highest and 
lowest FELs to which any of your subfamilies will be certified.
    (l) Where applicable, identify the vehicle family's deterioration 
factors and describe how you developed them. Present any emission test 
data you used for this (see Sec.  1037.241(c)).
    (m) Where applicable, state that you operated your emission-data 
vehicles as described in the application (including the test 
procedures, test parameters, and test fuels) to show you meet the 
requirements of this part.
    (n) [Reserved]
    (o) Report calculated and modeled emission results as follows:
    (1) For vocational vehicles and tractors, report modeling results 
for ten configurations. Include modeling inputs and detailed 
descriptions of how they were derived. Unless we specify otherwise, 
include the configuration with the highest modeling result, the lowest 
modeling result, and the configurations with the highest projected 
sales.
    (2) For trailers that demonstrate compliance with g/ton-mile 
emission standards as described in Sec.  1037.515, report the 
CO2 emission result for the configuration with the highest 
calculated value. If your trailer family generates or uses emission 
credits, also report the CO2 emission results for the 
configuration with the lowest calculated value, and for the 
configuration with the highest projected sales.

[[Page 74063]]

    (p) Where applicable, describe all adjustable operating parameters 
(see Sec.  1037.115), including production tolerances. You do not need 
to include parameters that do not affect emissions covered by your 
application. Include the following in your description of each 
parameter:
    (1) The nominal or recommended setting.
    (2) The intended physically adjustable range.
    (3) The limits or stops used to establish adjustable ranges.
    (4) Information showing why the limits, stops, or other means of 
inhibiting adjustment are effective in preventing adjustment of 
parameters on in-use vehicles to settings outside your intended 
physically adjustable ranges.
    (q) [Reserved]
    (r) Unconditionally certify that all the vehicles in the vehicle 
family comply with the requirements of this part, other referenced 
parts of the CFR, and the Clean Air Act.
    (s) Include good-faith estimates of U.S.-directed production 
volumes by subfamily. We may require you to describe the basis of your 
estimates.
    (t) Include the information required by other subparts of this 
part. For example, include the information required by Sec.  1037.725 
if you plan to generate or use emission credits.
    (u) Include other applicable information, such as information 
specified in this part or 40 CFR part 1068 related to requests for 
exemptions.
    (v) Name an agent for service located in the United States. Service 
on this agent constitutes service on you or any of your officers or 
employees for any action by EPA or otherwise by the United States 
related to the requirements of this part.


Sec.  1037.210  Preliminary approval before certification.

    If you send us information before you finish the application, we 
may review it and make any appropriate determinations. Decisions made 
under this section are considered to be preliminary approval, subject 
to final review and approval. We will generally not reverse a decision 
where we have given you preliminary approval, unless we find new 
information supporting a different decision. If you request preliminary 
approval related to the upcoming model year or the model year after 
that, we will make best-efforts to make the appropriate determinations 
as soon as practicable. We will generally not provide preliminary 
approval related to a future model year more than two years ahead of 
time.


Sec.  1037.211  Preliminary approval for manufacturers of aerodynamic 
devices.

    (a) If you design or manufacture aerodynamic devices for trailers, 
you may ask us to provide preliminary approval for the measured 
performance of your devices. While decisions made under this section 
are considered to be preliminary approval, we will not reverse a 
decision where we have given you preliminary approval, unless we find 
new information supporting a different decision. For example, where we 
measure the performance of your device after giving you preliminary 
approval and its measured performance is less than your data indicated, 
we may rescind the preliminary approval of your test results.
    (b) To request this, you must provide test data for 
[Delta]CdA values as specified in Sec.  1037.150(u) or Sec.  
1037.526. Trailer manufacturers may use approved [Delta]CdA 
values as inputs under Sec.  1037.515 to support their application for 
certification.


Sec.  1037.220  Amending maintenance instructions.

    You may amend your emission-related maintenance instructions after 
you submit your application for certification as long as the amended 
instructions remain consistent with the provisions of Sec.  1037.125. 
You must send the Designated Compliance Officer a written request to 
amend your application for certification for a vehicle family if you 
want to change the emission-related maintenance instructions in a way 
that could affect emissions. In your request, describe the proposed 
changes to the maintenance instructions. If operators follow the 
original maintenance instructions rather than the newly specified 
maintenance, this does not allow you to disqualify those vehicles from 
in-use testing or deny a warranty claim.
    (a) If you are decreasing or eliminating any specified maintenance, 
you may distribute the new maintenance instructions to your customers 
30 days after we receive your request, unless we disapprove your 
request. This would generally include replacing one maintenance step 
with another. We may approve a shorter time or waive this requirement.
    (b) If your requested change would not decrease the specified 
maintenance, you may distribute the new maintenance instructions any 
time after you send your request. For example, this paragraph (b) would 
cover adding instructions to increase the frequency of filter changes 
for vehicles in severe-duty applications.
    (c) You need not request approval if you are making only minor 
corrections (such as correcting typographical mistakes), clarifying 
your maintenance instructions, or changing instructions for maintenance 
unrelated to emission control. We may ask you to send us copies of 
maintenance instructions revised under this paragraph (c).


Sec.  1037.225  Amending applications for certification.

    Before we issue you a certificate of conformity, you may amend your 
application to include new or modified vehicle configurations, subject 
to the provisions of this section. After we have issued your 
certificate of conformity, you may send us an amended application 
requesting that we include new or modified vehicle configurations 
within the scope of the certificate, subject to the provisions of this 
section. You must amend your application if any changes occur with 
respect to any information that is included or should be included in 
your application.
    (a) You must amend your application before you take any of the 
following actions:
    (1) Add any vehicle configurations to a vehicle family that are not 
already covered by your application. For example, if your application 
identifies three possible engine models, and you plan to produce 
vehicles using an additional engine model, then you must amend your 
application before producing vehicles with the fourth engine model. The 
added vehicle configurations must be consistent with other vehicle 
configurations in the vehicle family with respect to the criteria 
listed in Sec.  1037.230.
    (2) Change a vehicle configuration already included in a vehicle 
family in a way that may change any of the components you described in 
your application for certification, or make any other changes that 
would make the emissions inconsistent with the information in your 
application. This includes production and design changes that may 
affect emissions any time during the vehicle's lifetime.
    (3) Modify an FEL for a vehicle family as described in paragraph 
(f) of this section.
    (b) To amend your application for certification, send the relevant 
information to the Designated Compliance Officer.
    (1) Describe in detail the addition or change in the vehicle model 
or configuration you intend to make.
    (2) Include engineering evaluations or data showing that the 
amended vehicle family complies with all applicable requirements. You 
may do this by

[[Page 74064]]

showing that the original emission-data vehicle is still appropriate 
for showing that the amended family complies with all applicable 
requirements.
    (3) If the original emission-data vehicle or emission modeling for 
the vehicle family is not appropriate to show compliance for the new or 
modified vehicle configuration, include new test data or emission 
modeling showing that the new or modified vehicle configuration meets 
the requirements of this part.
    (4) Include any other information needed to make your application 
correct and complete.
    (c) We may ask for more test data or engineering evaluations. You 
must give us these within 30 days after we request them.
    (d) For vehicle families already covered by a certificate of 
conformity, we will determine whether the existing certificate of 
conformity covers your newly added or modified vehicle. You may ask for 
a hearing if we deny your request (see Sec.  1037.820).
    (e) For vehicle families already covered by a certificate of 
conformity, you may start producing the new or modified vehicle 
configuration any time after you send us your amended application and 
before we make a decision under paragraph (d) of this section. However, 
if we determine that the affected vehicles do not meet applicable 
requirements, we will notify you to cease production of the vehicles 
and may require you to recall the vehicles at no expense to the owner. 
Choosing to produce vehicles under this paragraph (e) is deemed to be 
consent to recall all vehicles that we determine do not meet applicable 
emission standards or other requirements and to remedy the 
nonconformity at no expense to the owner. If you do not provide 
information required under paragraph (c) of this section within 30 days 
after we request it, you must stop producing the new or modified 
vehicles.
    (f) You may ask us to approve a change to your FEL in certain cases 
after the start of production. The changed FEL may not apply to 
vehicles you have already introduced into U.S. commerce, except as 
described in this paragraph (f). You may ask us to approve a change to 
your FEL in the following cases:
    (1) You may ask to raise your FEL for your vehicle subfamily at any 
time. In your request, you must show that you will still be able to 
meet the emission standards as specified in subparts B and H of this 
part. Use the appropriate FELs with corresponding production volumes to 
calculate emission credits for the model year, as described in subpart 
H of this part.
    (2) Where testing applies, you may ask to lower the FEL for your 
vehicle subfamily only if you have test data from production vehicles 
showing that emissions are below the proposed lower FEL. Otherwise, you 
may ask to lower your FEL for your vehicle subfamily at any time. The 
lower FEL applies only to vehicles you produce after we approve the new 
FEL. Use the appropriate FELs with corresponding production volumes to 
calculate emission credits for the model year, as described in subpart 
H of this part.
    (3) You may ask to add an FEL for your vehicle family at any time.
    (g) You may produce vehicles as described in your amended 
application for certification and consider those vehicles to be in a 
certified configuration if we approve a new or modified vehicle 
configuration during the model year under paragraph (d) of this 
section. Similarly, you may modify in-use vehicles as described in your 
amended application for certification and consider those vehicles to be 
in a certified configuration if we approve a new or modified vehicle 
configuration at any time under paragraph (d) of this section. 
Modifying a new or in-use vehicle to be in a certified configuration 
does not violate the tampering prohibition of 40 CFR 1068.101(b)(1), as 
long as this does not involve changing to a certified configuration 
with a higher family emission limit. See Sec.  1037.621(g) for special 
provisions that apply for changing to a different certified 
configuration in certain circumstances.


Sec.  1037.230  Vehicle families, sub-families, and configurations.

    (a) For purposes of certifying your vehicles to greenhouse gas 
standards, divide your product line into families of vehicles based on 
regulatory subcategories as specified in this section. Subcategories 
are specified using terms defined in Sec.  1037.801. Your vehicle 
family is limited to a single model year.
    (1) Apply subcategories for vocational vehicles and vocational 
tractors as shown in Table 1 of this section. This involves 15 separate 
subcategories for Phase 2 vehicles to account for engine 
characteristics, GVWR, and the selection of duty cycle for vocational 
vehicles as specified in Sec.  1037.510; vehicles may additionally fall 
into one of the subcategories defined by the custom-chassis standards 
in Sec.  1037.105(h). Divide Phase 1 vehicles into three GVWR-based 
vehicle service classes as shown in Table 1 of this section, 
disregarding additional specified characteristics. Table 1 follows:

                          Table 1 of Sec.   1037.230--Vocational Vehicle Subcategories
----------------------------------------------------------------------------------------------------------------
             Engine cycle                     Light HDV                Medium HDV               Heavy HDV
----------------------------------------------------------------------------------------------------------------
Compression-ignition.................  Urban..................  Urban..................  Urban.
                                       Multi-Purpose..........  Multi-Purpose..........  Multi-Purpose.
                                       Regional...............  Regional...............  Regional.
Spark-ignition.......................  Urban..................  Urban..................
                                       Multi-Purpose..........  Multi-Purpose..........
                                       Regional...............  Regional...............
----------------------------------------------------------------------------------------------------------------

    (2) Apply subcategories for tractors (other than vocational 
tractors) as shown in Table 2 of this section. Vehicles may 
additionally fall into one of the subcategories defined by the optional 
tractor standards in Sec.  1037.670.

            Table 2 of Sec.   1037.230--Tractor Subcategories
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Class 7                                           Class 8
------------------------------------------------------------------------
Low-roof tractors...............  Low-roof day cabs.  Low-roof sleeper
                                                       cabs.
Mid-roof tractors...............  Mid-roof day cabs.  Mid-roof sleeper
                                                       cabs.
High-roof tractors..............  High-roof day cabs  High-roof sleeper
                                                       cabs.
                                 ---------------------------------------
                                    Heavy-haul tractors (starting with
                                                 Phase 2).
------------------------------------------------------------------------


[[Page 74065]]

    (3) Apply subcategories for trailers as shown in the following 
table:

            Table 3 of Sec.   1037.230--Trailer Subcategories
------------------------------------------------------------------------
                                     Partial-aero
       Full-aero trailers              trailers         Other trailers
------------------------------------------------------------------------
Long dry box vans...............  Long dry box vans.  Non-aero trailers.
Short dry box vans..............  Short dry box vans  Non-box trailers.
Long refrigerated box vans......  Long refrigerated
                                   box vans..
Short refrigerated box vans.....  Short refrigerated
                                   box vans..
------------------------------------------------------------------------

    (b) If the vehicles in your family are being certified to more than 
one FEL, subdivide your greenhouse gas vehicle families into 
subfamilies that include vehicles with identical FELs. Note that you 
may add subfamilies at any time during the model year.
    (c) Group vehicles into configurations consistent with the 
definition of ``vehicle configuration'' in Sec.  1037.801. Note that 
vehicles with hardware or software differences that are related to 
measured or modeled emissions are considered to be different vehicle 
configurations even if they have the same modeling inputs and FEL. Note 
also, that you are not required to separately identify all 
configurations for certification. Note that you are not required to 
identify all possible configurations for certification; also, you are 
required to include in your end-of-year report only those 
configurations you produced.
    (d) You may combine dissimilar vehicles into a single vehicle 
family in special circumstances as follows:
    (1) For a Phase 1 vehicle model that straddles a roof-height, cab 
type, or GVWR division, you may include all the vehicles in the same 
vehicle family if you certify the vehicle family to the more stringent 
standard. For roof height, this means you must certify to the taller 
roof standards. For cab-type and GVWR, this means you must certify to 
the numerically lower standards.
    (2) For a Phase 2 vehicle model that includes a range of GVWR 
values that straddle weight classes, you may include all the vehicles 
in the same vehicle family if you certify the vehicle family to the 
numerically lower CO2 emission standard from the affected 
service classes. Vehicles that are optionally certified to a more 
stringent standard under this paragraph (d)(2) are subject to useful-
life and all other provisions corresponding to the weight class with 
the numerically lower CO2 emission standard. For a Phase 2 
tractor model that includes a range of roof heights that straddle 
subcategories, you may include all the vehicles in the same vehicle 
family if you certify the vehicle family to the appropriate subcategory 
as follows:
    (i) You may certify mid-roof tractors as high-roof tractors, but 
you may not certify high-roof tractors as mid-roof tractors.
    (ii) For tractor families straddling the low-roof/mid-roof 
division, you may certify the family based on the primary roof-height 
as long as no more than 10 percent of the tractors are certified to the 
otherwise inapplicable subcategory. For example, if 95 percent of the 
tractors in the family are less than 120 inches tall, and the other 5 
percent are 122 inches tall, you may certify the tractors as a single 
family in the low-roof subcategory.
    (iii) Determine the appropriate aerodynamic bin number based on the 
actual roof height if you measure a CdA value. However, use 
the GEM input for the bin based on the standards to which you certify. 
For example, of you certify as mid-roof tractors some low-roof tractors 
with a measured CdA value of 4.2 m\2\, they qualify as Bin 
IV; and you must input into GEM the mid-roof Bin IV value of 5.85 m\2\.
    (3) You may include refrigerated box vans in a vehicle family with 
dry box vans by treating them all as dry box vans for demonstrating 
compliance with emission standards. You may include certain other types 
of trailers in a vehicle family with a different type of trailer, such 
that the combined set of trailers are all subject to the more stringent 
standards, as follows:
    (i) Standards for long trailers are more stringent than standards 
for short trailers.
    (ii) Standards for long dry box vans are more stringent than 
standards for short refrigerated box vans.
    (iii) Standards for non-aero box vans are more stringent than 
standards for non-box trailers.
    (e) You may divide your families into more families than specified 
in this section.
    (f) You may ask us to allow you to group into the same 
configuration vehicles that have very small body hardware differences 
that do not significantly affect drag areas.


Sec.  1037.231  Powertrain families.

    (a) If you choose to perform powertrain testing as specified in 
Sec.  1037.550, use good engineering judgment to divide your product 
line into powertrain families that are expected to have similar fuel 
consumptions and CO2 emission characteristics throughout the 
useful life. Your powertrain family is limited to a single model year.
    (b) Except as specified in paragraph (c) of this section, group 
powertrains in the same powertrain family if they share all the 
following attributes:
    (1) Engine family.
    (2) Shared vehicle service class grouping, as follows:
    (i) Light HDV or Medium HDV.
    (ii) Heavy HDV other than heavy-haul tractors.
    (iii) Heavy-haul tractors.
    (3) Number of clutches.
    (4) Type of clutch (e.g., wet or dry).
    (5) Presence and location of a fluid coupling such as a torque 
converter.
    (6) Gear configuration, as follows:
    (i) Planetary (e.g., simple, compound, meshed-planet, stepped-
planet, multi-stage).
    (ii) Countershaft (e.g., single, double, triple).
    (iii) Continuously variable (e.g., pulley, magnetic, toroidal).
    (7) Number of available forward gears, and transmission gear ratio 
for each available forward gear, if applicable.
    (8) Transmission oil sump configuration (e.g., conventional or 
dry).
    (9) The power transfer configuration of any hybrid technology 
(e.g., series or parallel).
    (10) The energy storage device and capacity of any hybrid 
technology (e.g., 10 MJ hydraulic accumulator, 10 kW[middot]hr Lithium-
ion battery pack, 10 MJ ultracapacitor bank).
    (11) The rated output of any hybrid mechanical power technology 
(e.g., 50 kW electric motor).
    (c) For powertrains that share all the attributes described in 
paragraph (b) of this section, divide them further into separate 
powertrain families based on common calibration attributes. Group 
powertrains in the same powertrain

[[Page 74066]]

family to the extent that powertrain test results and corresponding 
emission levels are expected to be similar throughout the useful life.
    (d) You may subdivide a group of powertrains with shared attributes 
under paragraph (b) of this section into different powertrain families.
    (e) In unusual circumstances, you may group powertrains into the 
same powertrain family even if they do not have shared attributes under 
in paragraph (b) of this section if you show that their emission 
characteristics throughout the useful life will be similar.
    (f) If you include the axle when performing powertrain testing for 
the family, you must limit the family to include only those axles 
represented by the test results. You may include multiple axle ratios 
in the family if you test with the axle expected to produce the highest 
emission results.


Sec.  1037.232  Axle and transmission families.

    (a) If you choose to perform axle testing as specified in Sec.  
1037.560 or transmission testing as specified in Sec.  1037.565, use 
good engineering judgment to divide your product line into axle or 
transmission families that are expected to have similar hardware, 
noting that efficiencies can differ across the members of a family. 
Note that, while there is no certification for axle and transmission 
families under this part, vehicle manufacturers may rely on axle and 
transmission test data to certify their vehicles.
    (b) Except as specified in paragraph (d) of this section, group 
axles in the same axle family if they have the same number of drive 
axles and the same load rating.
    (c) Except as specified in paragraph (d) of this section, group 
transmissions in the same transmission family if they share all the 
following attributes:
    (1) Number and type of clutches (wet or dry).
    (2) Presence and location of a fluid coupling such as a torque 
converter.
    (3) Gear configuration, as follows:
    (i) Planetary (e.g., simple, compound, meshed-planet, stepped-
planet, multi-stage).
    (ii) Countershaft (e.g., single, double, triple).
    (iii) Continuously variable (e.g., pulley, magnetic, toroidal). 
Note that GEM does not accommodate efficiency testing for continuously 
variable transmissions.
    (4) Transmission oil sump configuration (conventional or dry).
    (d) You may subdivide a group of axles or powertrains with shared 
attributes under paragraph (b) or (c) of this section into different 
families.


Sec.  1037.235  Testing requirements for certification.

    This section describes the emission testing you must perform to 
show compliance with respect to the greenhouse gas emission standards 
in subpart B of this part, and to determine any input values from 
Sec. Sec.  1037.515 and 1037.520 that involve measured quantities.
    (a) Select emission-data vehicles that represent production 
vehicles and components for the vehicle family consistent with the 
specifications in Sec. Sec.  1037.205(o), 1037.515, and 1037.520. Where 
the test results will represent multiple vehicles or components with 
different emission performance, use good engineering judgment to select 
worst-case emission data vehicles or components. In the case of 
powertrain testing under Sec.  1037.550, select a test engine and test 
transmission by considering the whole range of vehicle models covered 
by the powertrain family and the mix of duty cycles specified in Sec.  
1037.510.
    (b) Test your emission-data vehicles (including emission-data 
components) using the procedures and equipment specified in subpart F 
of this part. Measure emissions (or other parameters, as applicable) 
using the specified procedures.
    (c) We may perform confirmatory testing by measuring emissions (or 
other parameters, as applicable) from any of your emission-data 
vehicles.
    (1) We may decide to do the testing at your plant or any other 
facility. If we do this, you must deliver the vehicle or component to a 
test facility we designate. The vehicle or component you provide must 
be in a configuration that is suitable for testing. For example, 
vehicles must have the tires you used for testing, and tractors must be 
set up with the trailer you used for testing. If we do the testing at 
your plant, you must schedule it as soon as possible and make available 
the instruments, personnel, and equipment we need (see paragraph (g) of 
this section for provisions that apply specifically for testing a 
tractor's aerodynamic performance).
    (2) If we measure emissions (or other parameters, as applicable) 
from your vehicle or component, the results of that testing become the 
official emission results for the vehicle or component. Note that 
changing the official emission result does not necessarily require a 
change in the declared modeling input value. Unless we later invalidate 
these data, we may decide not to consider your data in determining if 
your vehicle family meets applicable requirements.
    (3) Before we test one of your vehicles or components, we may set 
its adjustable parameters to any point within the physically adjustable 
ranges, if applicable.
    (4) Before we test one of your vehicles or components, we may 
calibrate it within normal production tolerances for anything we do not 
consider an adjustable parameter. For example, this would apply for a 
vehicle parameter that is subject to production variability because it 
is adjustable during production, but is not considered an adjustable 
parameter (as defined in Sec.  1037.801) because it is permanently 
sealed. For parameters that relate to a level of performance that is 
itself subject to a specified range (such as maximum power output), we 
will generally perform any calibration under this paragraph (c)(4) in a 
way that keeps performance within the specified range. Note that this 
paragraph (c)(4) does not allow us to test your vehicles in a condition 
that would be unrepresentative of production vehicles.
    (d) You may ask to use carryover data for a vehicle or component 
from a previous model year instead of doing new tests if the applicable 
emission-data vehicle from the previous model year remains the 
appropriate emission-data vehicle under paragraph (b) of this section.
    (e) We may require you to test a second vehicle or component of the 
same configuration in addition to the vehicle or component tested under 
paragraph (a) of this section.
    (f) If you use an alternate test procedure under 40 CFR 1065.10 and 
later testing shows that such testing does not produce results that are 
equivalent to the procedures specified in subpart F of this part, we 
may reject data you generated using the alternate procedure.
    (g) We may perform testing to verify your aerodynamic drag area 
values using any method specified in subpart F of this part. The 
following additional provisions apply:
    (1) We intend to use the same aerodynamic test facility you used, 
and if you provide any instruments you used, we intend to use those 
instruments to perform our testing.
    (2) We may perform coastdown testing to verify your tractor drag 
area for any certified configuration. If you use an alternate method 
for determining aerodynamic drag area for tractors, we may perform 
testing to verify Falt-aero as specified in subpart F of 
this part.
    (3) We may test trailers (and devices receiving preliminary 
approval) using the wind-tunnel method described in Sec.  1037.530. We 
may also test using an

[[Page 74067]]

alternate method; however, we will determine how to appropriately 
correct or correlate those results to testing with the wind-tunnel 
method.
    (h) You may ask us to use analytically derived GEM inputs for 
untested configurations as identified in subpart F of this part based 
on interpolation of all relevant measured values for related 
configurations, consistent with good engineering judgment. We may 
establish specific approval criteria base on prevailing industry 
practice. If we allow this, we may test any configurations. We may also 
require you to test any configurations as part of a selective 
enforcement audit.


Sec.  1037.241  Demonstrating compliance with exhaust emission 
standards for greenhouse gas pollutants.

    (a) Compliance determinations for purposes of certification depend 
on whether or not you participate in the ABT program in subpart H of 
this part.
    (1) If none of your vehicle families generate or use emission 
credits in a given model year,, each of your vehicle families is 
considered in compliance with the CO2 emission standards in 
Sec. Sec.  1037.105 through 1037.107 if all vehicle configurations in 
the family have calculated or modeled CO2 emission rates 
from Sec.  1037.515 or Sec.  1037.520 that are at or below the 
applicable standards. A vehicle family is deemed not to comply if any 
vehicle configuration in the family has a calculated or modeled 
CO2 emission rate that is above the applicable standard.
    (2) If you generate or use emission credits with one or more 
vehicle families in a given model year, your vehicle families within an 
averaging set are considered in compliance with the CO2 
emission standards in Sec. Sec.  1037.105 through 1037.107 if the sum 
of positive and negative credits for all vehicle configurations in 
those vehicle families lead to a zero balance or a positive balance of 
credits, except as allowed bySec.  1037.745. Note that the FEL is 
considered to be the applicable emission standard for an individual 
configuration.
    (b) For non-box trailers and non-aero box vans, your vehicle family 
is considered in compliance with the emission standards if all vehicle 
configurations in that family meet specified design standards and have 
TRRL values at or below the specified standard. Your family is deemed 
not to comply for certification if any trailer does not meet specified 
design standards or if any vehicle configuration in that family has a 
measured TRRL value above the specified standard.
    (c) We may require you to provide an engineering analysis showing 
that the performance of your emission controls will not deteriorate 
during the useful life with proper maintenance. If we determine that 
your emission controls are likely to deteriorate during the useful 
life, we may require you to develop and apply deterioration factors 
consistent with good engineering judgment. For example, you may need to 
apply a deterioration factor to address deterioration of battery 
performance for a hybrid electric vehicle. Where the highest useful 
life emissions occur between the end of useful life and at the low-hour 
test point, base deterioration factors for the vehicles on the 
difference between (or ratio of) the point at which the highest 
emissions occur and the low-hour test point.


Sec.  1037.243  Demonstrating compliance with evaporative emission 
standards.

    (a) For purposes of certification, your vehicle family is 
considered in compliance with the evaporative emission standards in 
subpart B of this part if you prepare an engineering analysis showing 
that your vehicles in the family will comply with applicable standards 
throughout the useful life, and there are no test results from an 
emission-data vehicle representing the family that exceed an emission 
standard.
    (b) Your evaporative emission family is deemed not to comply if 
your engineering analysis is not adequate to show that all the vehicles 
in the family will comply with applicable emission standards throughout 
the useful life, or if a test result from an emission-data vehicle 
representing the family exceeds an emission standard.
    (c) To compare emission levels with emission standards, apply 
deterioration factors to the measured emission levels. Establish an 
additive deterioration factor based on an engineering analysis that 
takes into account the expected aging from in-use vehicles.
    (d) Apply the deterioration factor to the official emission result, 
as described in paragraph (c) of this section, then round the adjusted 
figure to the same number of decimal places as the emission standard. 
Compare the rounded emission levels to the emission standard for each 
emission-data vehicle.
    (e) Your analysis to demonstrate compliance with emission standards 
must take into account your design strategy for vehicles that require 
testing. Specifically, vehicles above 14,000 pounds GVWR are presumed 
to need the same technologies that are required for heavy-duty vehicles 
at or below 14,000 pounds GVWR. Similarly, your analysis to establish a 
deterioration factor must take into account your testing to establish 
deterioration factors for smaller vehicles.


Sec.  1037.250  Reporting and recordkeeping.

    (a) Within 90 days after the end of the model year, send the 
Designated Compliance Officer a report including the total U.S.-
directed production volume of vehicles you produced in each vehicle 
family during the model year (based on information available at the 
time of the report). Report by vehicle identification number and 
vehicle configuration and identify the subfamily identifier. Report 
uncertified vehicles sold to secondary vehicle manufacturers. We may 
waive the reporting requirements of this paragraph (a) for small 
manufacturers.
    (b) Organize and maintain the following records:
    (1) A copy of all applications and any summary information you send 
us.
    (2) Any of the information we specify in Sec.  1037.205 that you 
were not required to include in your application.
    (3) A detailed history of each emission-data vehicle (including 
emission-related components), if applicable.
    (4) Production figures for each vehicle family divided by assembly 
plant.
    (5) Keep a list of vehicle identification numbers for all the 
vehicles you produce under each certificate of conformity. Also 
identify the technologies that make up the certified configuration for 
each vehicle you produce.
    (c) Keep required data from emission tests and all other 
information specified in this section for eight years after we issue 
your certificate. If you use the same emission data or other 
information for a later model year, the eight-year period restarts with 
each year that you continue to rely on the information.
    (d) Store these records in any format and on any media, as long as 
you can promptly send us organized, written records in English if we 
ask for them. You must keep these records readily available. We may 
review them at any time.
    (e) If you fail to properly keep records or to promptly send us 
information as required under this part, we may require that you submit 
the information specified in this section after each calendar quarter, 
and we may require that you routinely send us information that the 
regulation requires you to submit only if we request it. If we find 
that you are fraudulent or grossly negligent or otherwise act in bad 
faith regarding information reporting and recordkeeping, we may require 
that you

[[Page 74068]]

send us a detailed description of the certified configuration for each 
vehicle before you produce it.


Sec.  1037.255  What decisions may EPA make regarding my certificate of 
conformity?

    (a) If we determine your application is complete and shows that the 
vehicle family meets all the requirements of this part and the Act, we 
will issue a certificate of conformity for your vehicle family for that 
model year. We may make the approval subject to additional conditions.
    (b) We may deny your application for certification if we determine 
that your vehicle family fails to comply with emission standards or 
other requirements of this part or the Clean Air Act. We will base our 
decision on all available information. If we deny your application, we 
will explain why in writing.
    (c) In addition, we may deny your application or suspend or revoke 
your certificate if you do any of the following:
    (1) Refuse to comply with any testing or reporting requirements.
    (2) Submit false or incomplete information (paragraph (e) of this 
section applies if this is fraudulent). This includes doing anything 
after submission of your application to render any of the submitted 
information false or incomplete.
    (3) Render any test data inaccurate.
    (4) Deny us from completing authorized activities (see 40 CFR 
1068.20). This includes a failure to provide reasonable assistance.
    (5) Produce vehicles for importation into the United States at a 
location where local law prohibits us from carrying out authorized 
activities.
    (6) Fail to supply requested information or amend your application 
to include all vehicles being produced.
    (7) Take any action that otherwise circumvents the intent of the 
Act or this part, with respect to your vehicle family.
    (d) We may void the certificate of conformity for a vehicle family 
if you fail to keep records, send reports, or give us information as 
required under this part or the Act. Note that these are also 
violations of 40 CFR 1068.101(a)(2).
    (e) We may void your certificate if we find that you intentionally 
submitted false or incomplete information. This includes rendering 
submitted information false or incomplete after submission.
    (f) If we deny your application or suspend, revoke, or void your 
certificate, you may ask for a hearing (see Sec.  1037.820).

Subpart D--Testing Production Vehicles and Engines


Sec.  1037.301  Overview of measurements related to GEM inputs in a 
selective enforcement audit.

    (a) We may require you to perform selective enforcement audits 
under 40 CFR part 1068, subpart E, with respect to any GEM inputs in 
your application for certification. Sections 1037.305 through 1037.315 
describe how this applies uniquely in certain circumstances.
    (b) A selective enforcement audit for this part 1037 consists of 
performing measurements with production vehicles relative to one or 
more declared values for GEM inputs, and using those measured values in 
place of your declared values to run GEM. Except as specified in this 
subpart, the vehicle is considered passing if the new modeled emission 
result is at or below the modeled emission result corresponding to the 
declared GEM inputs. If you report an FEL for the vehicle configuration 
before the audit, we will instead consider the vehicle passing if the 
new cycle-weighted emission result matches or exceeds the efficiency 
improvement is at or below the FEL.
    (c) We may audit your production components and your records to 
confirm that physical parameters are correct, such as dimensional 
accuracy and material selection. We may also audit your records to 
confirm that you are properly documenting the certified configurations 
of production vehicles.
    (d) Selective enforcement audit provisions for fuel maps apply to 
engine manufacturers as specified in 40 CFR 1036.301. See Sec.  
1037.315 for selective enforcement audit provisions applicable to 
powertrain fuel maps.
    (e) We may suspend or revoke certificates based on the outcome of a 
selective enforcement audit for any appropriate configurations within 
one or more vehicle families.
    (f) We may apply selective enforcement audit provisions with 
respect to off-cycle technologies, with any necessary modifications, 
consistent with good engineering judgment.


Sec.  1037.305  Audit procedures for tractors--aerodynamic testing.

    To perform a selective enforcement audit with respect to drag area 
for tractors, use the reference method specified in Sec.  1037.525; we 
may instead require you to use the same method you used for 
certification. The following provisions apply instead of 40 CFR 
1068.420 for a selective enforcement audit with respect to drag area:
    (a) Determine whether or not a tractor fails to meet standards as 
follows:
    (1) We will select a vehicle configuration for testing. Perform a 
coastdown measurement with the vehicle in its production configuration 
according to Sec.  1037.528. Instead of the process described in Sec.  
1037.528(h)(12), determine your test result as described in this 
paragraph (a). You must have an equal number of runs in each direction.
    (2) Measure a yaw curve for your test vehicle using your alternate 
method according to Sec.  1037.525(b)(3). You do not need to test at 
the coastdown effective. You may use a previously established yaw curve 
from your certification testing if it is available.
    (3) Using this yaw curve, perform a regression using values of drag 
area, CdAalt, and yaw angle, [psi]alt, 
to determine the air-direction correction coefficients, a0, 
a1, a2, a3, and a4, for the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.083

    (4) Adjust the drag area value from each coastdown run, 
CdArun, from the yaw angle of each run, 
[psi]run, to 4.5[deg] to represent a wind-
averaged drag area value, CdAwa by applying Eq. 
1037.305-1 as follows:

[[Page 74069]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.084

    (5) Perform additional coastdown measurements until you reach a 
pass or fail decision under this paragraph (a).
    (6) Calculate statistical values to characterize cumulative test 
results at least once per day based on an equal number of coastdown 
runs in each direction. Determine the wind-averaged drag area value for 
the test CdAwa by averaging all 
CdAwa-run values for all days of testing. 
Determine the upper and lower bounds of the drag area value, 
CdAwa-bounded, expressed to two decimal places, 
using a confidence interval as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.085

Where:

CdAwa-boundeded = the upper bound, 
CdAwa-upper, and lower bound, 
CdAwa-lower, of the drag area value, where 
CdAwa-upper is the larger number.
CdAwa = the average of all 
CdAwa-run values.
    [sigma] = the standard deviation of all 
CdArun values (see 40 CFR 1065.602(c)).
    n = the total number of coastdown runs.

    (7) Compliance is determined based on the values of 
CdAwa-upper and CdAwa-lower 
relative to the adjusted bin boundary. For purposes of this section, 
the upper limit of a bin is expressed as the specified value plus 0.05 
to account for rounding. For example, for a bin including values of 
5.5-5.9 m\2\, being above the upper limit means exceeding 5.95. The 
vehicle reaches a pass or fail decision relative to the adjusted bin 
boundary based on one of the following criteria:
    (i) The vehicle passes if CdAwa-upper is less 
than or equal to the upper limit of the bin to which you certified the 
vehicle.
    (ii) The vehicle fails if CdAwa-lower is 
greater than the upper limit of the bin to which you certified the 
vehicle.
    (iii) The vehicle passes if you perform 100 coastdown runs and 
CdAwa-upper is greater than and 
CdAwa-lower is lower than the upper limit of the 
bin to which you certified the vehicle.
    (iv) The vehicle fails if you choose to stop testing before 
reaching a final determination under this paragraph (a)(7).
    (b) If you reach a pass decision on the first test vehicle, the 
emission family passes the SEA and you may stop testing. If you reach a 
fail decision on the first test vehicle, repeat the testing described 
in paragraph (a) of this section for two additional vehicles of the 
same configuration, or of a different configuration that we specify. 
Continue testing two additional vehicles for each failing vehicle until 
you reach a pass or fail decision for the family based on one of the 
following criteria:
    (1) The emission family passes if at any point more than 50 percent 
of the vehicles have reached a pass decision.
    (2) The emission family fails if six vehicles reach a fail 
decision.
    (3) The emission family passes if you test 11 vehicles with five or 
fewer vehicles reaching a fail decision.
    (4) The emission family fails if you choose to stop testing before 
reaching a final determination under this paragraph (b).
    (c) We may suspend a certificate of conformity as described in 40 
CFR 1068.430 if your emission family fails an SEA, subject to the 
following provisions:
    (1) We may reinstate a suspended certificate if you revise 
Falt-aero or make other changes to your testing methodology 
to properly correlate your testing to the reference method specified in 
Sec.  1037.525.
    (2) We may require you to apply any adjustments and corrections 
determined under paragraph (c)(1) of this section to your other 
emission families in any future application for certification.
    (d) If we test some of your vehicles in addition to your testing, 
we may decide not to include your test results as official data for 
those vehicles if there is substantial disagreement between your 
testing and our testing. We will reinstate your data as valid if you 
show us that we made an error and your data are correct. If we perform 
testing, we may choose to stop testing after any number of tests and 
not determine a failure.
    (e) If we rely on our test data instead of yours, we will notify 
you in writing of our decision and the reasons we believe your facility 
is not appropriate for doing the tests we require under this paragraph 
(b). You may request in writing that we consider your test results from 
the same facility for future testing if you show us that you have made 
changes to resolve the problem.
    (f) We may allow you to perform additional replicate tests with a 
given vehicle or to test additional vehicles, consistent with good 
engineering judgment.
    (g) You must assign the appropriate CdA bin for your 
compliance demonstration at the end of the model year for every 
configuration you tested that failed under this section.


Sec.  1037.310  Audit procedures for trailers.

    (a) We may audit trailer manufacturers to ensure that trailers are 
being produced to conform with the certificate of conformity. If this 
involves aerodynamic measurements, we will specify how to adapt the 
protocol described in Sec.  1037.305 to appropriately evaluate trailer 
performance.
    (b) We may require device manufacturers that obtain preliminary 
approval under Sec.  1037.211 to perform aerodynamic testing of 
production samples of approved devices to ensure that the devices 
conform to the approved configuration.


Sec.  1037.315  Audit procedures related to powertrain testing.

    (a) For vehicles certified based on powertrain testing as specified 
in Sec.  1037.550, we may apply the selective enforcement audit 
requirements to the powertrain. If engine manufacturers

[[Page 74070]]

perform the powertrain testing and include those results in their 
certification under 40 CFR part 1036, they are responsible for 
selective enforcement audits related to those results. Otherwise, the 
certificate holder for the vehicle is responsible for the selective 
enforcement audit.
    (b) The following provisions apply for a selective enforcement 
audit with respect to powertrain testing:
    (1) A selective enforcement audit for powertrains would generally 
consist of performing a test with the complete powertrain (engine and 
transmission together). We may alternatively allow you to test the 
engine on a dynamometer with no installed transmission as described in 
Sec.  1037.551.
    (2) Recreate a set of test results for each of three separate 
powertrains. Generate GEM results for each of the configurations that 
are defined as the centers of each group of four points that define a 
boundary of cycle work and average powertrain speed divided by average 
vehicle speed, for each of the three selected powertrains. See 40 CFR 
1036.301(b)(2) for an example on how these points are defined. Each 
unique map for a given configuration with a particular powertrain 
constitutes a separate test for purposes of evaluating whether the 
vehicle family meets the pass-fail criteria under 40 CFR 1068.420. The 
test result for a single test run in the audit is considered passing if 
it is at or below the value selected as an input for GEM. Perform 
testing with the same GEM configurations for additional powertrains as 
needed to reach a pass-fail decision under 40 CFR 1068.240.


Sec.  1037.320  Audit procedures for axles and transmissions.

    Selective enforcement audit provisions apply for axles and 
transmissions relative to the efficiency demonstrations of Sec. Sec.  
1037.560 and 1037.565 as follows:
    (a) A selective enforcement audit for axles or transmissions would 
consist of performing measurements with a production axle or 
transmission to determine mean power loss values as declared for GEM 
simulations, and running GEM over one or more applicable duty cycles 
based on those measured values. The engine is considered passing for a 
given configuration if the new modeled emission result for every 
applicable duty cycle is at or below the modeled emission result 
corresponding to the declared GEM inputs.
    (b) Run GEM for each applicable vehicle configuration identified in 
40 CFR 1036.540. For axle testing, this may require omitting several 
vehicle configurations based on selecting axle ratios that correspond 
to the tested axle. The GEM result for each vehicle configuration 
counts as a separate test for determining whether the family passes or 
fails the audit. Select additional production axles or transmissions to 
perform additional tests as needed.

Subpart E--In-Use Testing


Sec.  1037.401  General provisions.

    (a) We may perform in-use testing of any vehicle subject to the 
standards of this part. For example, we may test vehicles to verify 
drag areas or other GEM inputs as specified in paragraph (b) of this 
section.
    (b) We may measure the drag area of a vehicle you produced after it 
has been placed into service. We may use any of the procedures as 
specified in Sec. Sec.  1037.525 through 1037.527 for measuring drag 
area. Your vehicle conforms to the regulations of this part with 
respect to aerodynamic performance if we measure its drag area to be at 
or below the maximum drag area allowed for the bin to which that 
configuration was certified.

Subpart F--Test and Modeling Procedures


Sec.  1037.501  General testing and modeling provisions.

    This subpart specifies how to perform emission testing and emission 
modeling required elsewhere in this part.
    (a) Except as specified in subpart B of this part, you must 
demonstrate that you meet emission standards using emission modeling as 
described in Sec. Sec.  1037.515 and 1037.520. This modeling depends on 
several measured values as described in this subpart F. You may use 
fuel-mapping information from the engine manufacturer as described in 
40 CFR 1036.535 and 1036.540, or you may use powertrain testing as 
described in Sec.  1037.550.
    (b) Where exhaust emission testing is required, use equipment and 
procedures as described in 40 CFR part 1065 and part 1066. Measure 
emissions of all the exhaust constituents subject to emission standards 
as specified in 40 CFR part 1065 and part 1066. Use the applicable duty 
cycles specified in Sec.  1037.510.
    (c) See 40 CFR 86.101 and 86.1813 for measurement procedures that 
apply for evaporative and refueling emissions.
    (d) Use the applicable fuels specified 40 CFR part 1065 to perform 
valid tests.
    (1) For service accumulation, use the test fuel or any commercially 
available fuel that is representative of the fuel that in-use vehicles 
will use.
    (2) For diesel-fueled vehicles, use the appropriate diesel fuel 
specified for emission testing. Unless we specify otherwise, the 
appropriate diesel test fuel is ultra-low sulfur diesel fuel.
    (3) For gasoline-fueled vehicles, use the gasoline for ``general 
testing'' as specified in 40 CFR 86.1305.
    (e) You may use special or alternate procedures as specified in 40 
CFR 1065.10.
    (f) This subpart is addressed to you as a manufacturer, but it 
applies equally to anyone who does testing for you, and to us when we 
perform testing to determine if your vehicles meet emission standards.
    (g) Apply this paragraph (g) whenever we specify the use of 
standard trailers. Unless otherwise specified, a tolerance of  2 inches applies for all nominal trailer dimensions.
    (1) The standard trailer for high-roof tractors must meet the 
following criteria:
    (i) It is an unloaded two-axle dry van 53.0 feet long, 102 inches 
wide, and 162 inches high (measured from the ground with the trailer 
level).
    (ii) It has a king pin located with its center 36  0.5 
inches from the front of the trailer and a minimized trailer gap (no 
greater than 45 inches).
    (iii) It has a simple orthogonal shape with smooth surfaces and 
nominally flush rivets. Except as specified in paragraph (g)(1)(v) of 
this section, the standard trailer does not include any aerodynamic 
features such as side fairings, rear fairings, or gap reducers. It may 
have a scuff band no more than 0.13 inches thick.
    (iv) It includes dual 22.5 inch wheels, standard tandem axle, 
standard mudflaps, and standard landing gear. The centerline of the 
tandem axle assembly must be 145  5 inches from the rear of 
the trailer. The landing gear must be installed in a conventional 
configuration.
    (v) For the Phase 2 standards, include side skirts meeting the 
specifications of this paragraph (g)(1)(v). The side skirts must be 
mounted flush with both sides of the trailer. The skirts must be an 
isosceles trapezoidal shape. Each skirt must have a height of 36  2 inches. The top edge of the skirt must be straight with a 
length of 341  2 inches. The bottom edge of the skirt must 
be straight with a length of 268  2 inches and have a 
ground clearance of 8  2 inches through that full length. 
The sides of the skirts must be straight. The rearmost point of the 
skirts must be mounted 32  2 inches in front of the 
centerline of the trailer tandem axle assembly. We may approve your 
request to use a skirt with different dimensions if these

[[Page 74071]]

specified values are impractical or inappropriate for your test 
trailer, and you propose alternative dimensions that provide an 
equivalent or comparable degree of aerodynamic drag for your test 
configuration.
    (2) The standard trailer for mid-roof tractors is an empty two-axle 
tank trailer 42  1 feet long by 140 inches high and 102 
inches wide.
    (i) It has a 40  1 feet long cylindrical tank with a 
7000  7 gallon capacity, smooth surface, and rounded ends.
    (ii) The standard tank trailer does not include any aerodynamic 
features such as side fairings, but does include a centered 20 inch 
manhole, side-centered ladder, and lengthwise walkway. It includes dual 
24.5 inch wheels.
    (3) The standard trailer for low-roof tractors is an unloaded two-
axle flatbed trailer 53  1 feet long and 102 inches wide.
    (i) The deck height is 60.0  0.5 inches in the front 
and 55.0  0.5 inches in the rear. The standard trailer does 
not include any aerodynamic features such as side fairings.
    (ii) It includes an air suspension and dual 22.5 inch wheels on 
tandem axles.
    (h) Use a standard tractor for measuring aerodynamic drag of 
trailers. Standard tractors must be certified at Bin III (or more 
aerodynamic if a Bin III tractor is unavailable) for Phase 1 or Phase 2 
under Sec.  1037.520(b)(1) or (3). The standard tractor for long 
trailers is a Class 8 high-roof sleeper cab. The standard tractor for 
short trailers is a Class 7 or Class 8 high-roof day cab with a 4 x 2 
drive-axle configuration.


Sec.  1037.510  Duty-cycle exhaust testing.

    This section applies for powertrain testing, cycle-average engine 
fuel mapping, certain off-cycle testing under Sec.  1037.610, and the 
advanced-technology provisions of Sec.  1037.615.
    (a) Measure emissions by testing the vehicle on a chassis 
dynamometer or the powertrain on a powertrain dynamometer with the 
applicable duty cycles. Each duty cycle consists of a series of speed 
commands over time--variable speeds for the transient test and constant 
speeds for the highway cruise tests. None of these cycles include 
vehicle starting or warmup.
    (1) Perform testing for Phase 1 vehicles as follows to generate 
credits or adjustment factors for off-cycle or advanced technologies:
    (i) Transient cycle. The transient cycle is specified in Appendix I 
of this part. Warm up the vehicle. Start the duty cycle within 30 
seconds after concluding the preconditioning procedure. Start sampling 
emissions at the start of the duty cycle.
    (ii) Cruise cycle. For the 55 mi/hr and 65 mi/hr highway cruise 
cycles, warm up the vehicle at the test speed, then sample emissions 
for 300 seconds while maintaining vehicle speed within 1.0 
mi/hr of the speed setpoint; this speed tolerance applies instead of 
the approach specified in 40 CFR 1066.425(b)(1) and (2).
    (2) For cycle-average engine fuel mapping under 40 CFR 1036.540 or 
powertrain testing under Sec. Sec.  1037.550 or 1037.555, perform 
testing as described in this paragraph (a)(2) to generate GEM inputs 
for each simulated vehicle configuration, and for each of the four test 
runs representing different idle speed settings. You may perform any 
number of these test runs directly in succession once the engine or 
powertrain is warmed up. If you interrupt the test sequence with a 
break of up to 30 minutes, such as to perform analyzer calibration, 
repeat operation over the previous duty cycle to precondition the 
vehicle before restarting the test sequence. Perform testing as 
follows:
    (i) Transient cycle. The transient cycle is specified in Appendix I 
of this part. Initially warm up the engine or powertrain by operating 
over one transient cycle. Within 60 seconds after concluding the warm 
up cycle, start emission sampling while the vehicle operates over the 
duty cycle.
    (ii) Highway cruise cycle. The grade portion of the route 
corresponding to the 55 mi/hr and 65 mi/hr highway cruise cycles is 
specified in Appendix IV of this part. Initially warm up the engine or 
powertrain by operating it over the duty cycle. Within 60 seconds after 
concluding the preconditioning cycle, start emission sampling while the 
vehicle operates over the duty cycle, maintaining vehicle speed between 
-1.0 mi/hr and 3.0 mi/hr of the speed setpoint; this speed tolerance 
applies instead of the approach specified in 40 CFR 1066.425(b)(1) and 
(2).
    (iii) Drive idle. Perform testing at a loaded idle condition for 
Phase 2 vocational vehicles. Warm up the powertrain by operating it at 
65 mi/hr for 600 seconds. Within 10 seconds after concluding the 
preconditioning cycle, set the engine to operate at idle speed for 90 
seconds, with the brake applied and the transmission in drive (or 
clutch depressed for manual transmission), and sample emissions to 
determine mean emission values (in g/s) over the last 30 seconds of 
idling.
    (iv) Parked idle. Perform testing at an unloaded idle condition for 
Phase 2 vocational vehicles. Warm up the powertrain by operating it at 
65 mi/hr for 600 seconds. Within 60 seconds after concluding the 
preconditioning cycle, set the engine to operate at idle speed for 600 
seconds, with the transmission in park (or the transmission in neutral 
with the parking brake applied for manual transmissions), and sample 
emissions to determine mean emission values (in g/s) over the full 600 
seconds of idling.
    (3) Where applicable, perform testing on a chassis dynamometer as 
follows:
    (i) Transient cycle. The transient cycle is specified in Appendix I 
of this part. Warm up the vehicle by operating over one transient 
cycle. Within 60 seconds after concluding the warm up cycle, start 
emission sampling and operate the vehicle over the duty cycle.
    (ii) Highway cruise cycle. The grade portion of the route 
corresponding to the 55 mi/hr and 65 mi/hr highway cruise cycles is 
specified in Appendix IV of this part. Warm up the vehicle by operating 
it at the appropriate speed setpoint over the duty cycle. Within 60 
seconds after concluding the preconditioning cycle, start emission 
sampling and operate the vehicle over the duty cycle, maintaining 
vehicle speed within 1.0 mi/hr of the speed setpoint; this 
speed tolerance applies instead of the approach specified in 40 CFR 
1066.425(b)(1) and (2).
    (b) Calculate the official emission result from the following 
equation:

[[Page 74072]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.086

Where:

eCO2comp = total composite mass of CO2 
emissions in g/ton-mile, rounded to the nearest whole number for 
vocational vehicles and to the first decimal place for tractors.
PL = the standard payload, in tons, as specified in Sec.  1037.705.
vmoving = mean composite weighted driven vehicle speed, 
excluding idle operation, as shown in Table 1 of this section for 
Phase 2 vocational vehicles. For other vehicles, let 
vmoving = 1.
w[cycle] = weighting factor for the appropriate test 
cycle, as shown in Table 1 of this section.
m[cycle] = CO2 mass emissions over each test 
cycle (other than idle).
D[cycle] = the total driving distance for the indicated 
duty cycle. Use 2.842 miles for the transient cycle, and use 13.429 
miles for both of the highway cruise cycles.
mi[cycle]-idle = CO2 emission rate at idle.

    Example: Class 7 vocational vehicle meeting the Phase 2 
standards based on the Regional duty cycle.
PL = 5.6 tons
vmoving = 38.41 mi/hr
wtransient = 20% = 0.20
wdrive-idle = 0% = 0
wparked-idle = 25% = 0.25
w55 = 24% = 0.24
w65 = 56% = 0.56
mtransient = 4083 g
m55 = 13834 g
m65 = 17018 g
Dtransient = 2.8449 miles
D55 = 13.429 miles
D65 = 13.429 miles
midrive-idle = 4188 g/hr
miparked-idle = 3709 g/hr
[GRAPHIC] [TIFF OMITTED] TR25OC16.087

    (c) Weighting factors apply for each type of vehicle and for each 
duty cycle as follows:
    (1) GEM applies weighting factors for specific types of tractors as 
shown in Table 1 of this section.
    (2) GEM applies weighting factors for vocational vehicles as shown 
in Table 1 of this section. Modeling for Phase 2 vocational vehicles 
depends on characterizing vehicles by duty cycle to apply proper 
weighting factors and average speed values. Select either Urban, 
Regional, or Multi-Purpose as the most appropriate duty cycle for 
modeling emission results with each vehicle configuration, as specified 
in Sec. Sec.  1037.140 and 1037.150.
    (3) Table 1 follows:

                                              Table 1 of Sec.   1037.510--Weighting Factors for Duty Cycles
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Distance-weighted                       Time-weighted \1\              Average
                                                            --------------------------------------------------------------------------------    speed
                                                                            55 mi/hr      65 mi/hr                                           during non-
                                                              Transient      cruise        cruise      Drive idle  Parked idle    Non-idle   idle cycles
                                                                            (percent)     (percent)    (percent)    (percent)    (percent)   (mi/hr) \2\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Day Cabs...................................................           19            17            64  ...........  ...........  ...........  ...........
Sleeper Cabs...............................................            5             9            86  ...........  ...........  ...........  ...........
Heavy-haul tractors........................................           19            17            64  ...........  ...........  ...........  ...........
Vocational--Regional.......................................           20            24            56            0           25           75        38.41
Vocational--Multi-Purpose (2b-7)...........................           54            29            17           17           25           58        23.18
Vocational--Multi-Purpose (8)..............................           54            23            23           17           25           58        23.27
Vocational--Urban (2b-7)...................................           92             8             0           15           25           60        16.25
Vocational--Urban (8)......................................           90            10             0           15           25           60        16.51
Vocational with conventional powertrain (Phase 1 only).....           42            21            37  ...........  ...........  ...........  ...........
Vocational Hybrid Vehicles (Phase 1 only)..................           75             9            16  ...........  ...........  ...........  ...........
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Note that these drive idle and non-idle weighting factors do not reflect additional drive idle that occurs during the transient cycle. The transient
  cycle does not include any parked idle.
\2\ These values apply even for vehicles not following the specified speed traces.

    (d) For transient testing, compare actual second-by-second vehicle 
speed with the speed specified in the test cycle and ensure any 
differences are consistent with the criteria as specified in 40 CFR 
1066.425. If the speeds do not

[[Page 74073]]

conform to these criteria, the test is not valid and must be repeated.
    (e) Run test cycles as specified in 40 CFR part 1066. For testing 
vehicles equipped with cruise control over the highway cruise cycles, 
use the vehicle's cruise control to control the vehicle speed. For 
vehicles equipped with adjustable vehicle speed limiters, test the 
vehicle with the vehicle speed limiter at its highest setting.
    (f) For Phase 1, test the vehicle using its adjusted loaded vehicle 
weight, unless we determine this would be unrepresentative of in-use 
operation as specified in 40 CFR 1065.10(c)(1).
    (g) For hybrid vehicles, correct for the net energy change of the 
energy storage device as described in 40 CFR 1066.501.


Sec.  1037.515  Determining CO2 emissions to show compliance 
for trailers.

    This section describes a compliance approach for trailers that is 
consistent with the modeling for vocational vehicles and tractors 
described in Sec.  1037.520, but is simplified consistent with the 
smaller number of trailer parameters that affect CO2 
emissions. Note that the calculated CO2 emission rate, 
eCO2, is equivalent to the value that would result from 
running GEM with the same input values.
    (a) Compliance equation. Calculate CO2 emissions for 
demonstrating compliance with emission standards for each trailer 
configuration.
    (1) Use the following equation:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.088
    
Where:

Ci = constant values for calculating CO2 
emissions from this regression equation derived from GEM, as shown 
in Table 1 of this section. Let C5 = 0.988 for trailers 
that have automatic tire inflation systems with all wheels, and let 
C5 = 0.990 for trailers that have tire pressure 
monitoring systems with all wheels (or a mix of the two systems); 
otherwise, let C5 1.
TRRL = tire rolling resistance level as specified in paragraph (b) 
of this section.
[Delta]CdA = the [Delta]CdA value for the 
trailer as specified in paragraph (c) of this section.
WR = weight reduction as specified in paragraph (d) or (e) of this 
section.

                Table 1 of Sec.   1037.515--Regression Coefficients for Calculating CO2 Emissions
----------------------------------------------------------------------------------------------------------------
                Trailer category                        C1              C2              C3              C4
----------------------------------------------------------------------------------------------------------------
Long dry box van................................            76.1            1.67           -5.82        -0.00103
Long refrigerated box van.......................            77.4            1.75           -5.78        -0.00103
Short dry box van...............................           117.8            1.78           -9.48        -0.00258
Short refrigerated box van......................           121.1            1.88           -9.36        -0.00264
----------------------------------------------------------------------------------------------------------------

    (2) The following is an example for calculating the mass of 
CO2 emissions, eCO2, from a long dry box van that 
has a tire pressure monitoring system for all wheels, an aluminum 
suspension assembly, aluminum floor, and is designated as Bin IV:

C1 = 76.1
C2 = 1.67
TRRL = 4.6 kg/tonne
C3 = -5.82
[Delta]CdA = 0.7 m\2\
C4 = -0.00103
WR = 655 lbs
C5 = 0.990
eCO2 = (76.1 + 1.67 + (-5.82 [middot]0.7) + (-0.00103 
[middot]655)) [middot]0.990
eCO2 = 78.24 g/ton-mile
    (b) Tire rolling resistance. Use the procedure specified in Sec.  
1037.520(c) to determine the tire rolling resistance level for your 
tires. Note that you may base tire rolling resistance levels on 
measurements performed by tire manufacturers, as long as those 
measurements meet this part's specifications.
    (c) Drag area. You may use [Delta]CdA values approved 
under Sec.  1037.211 for device manufacturers if your trailers are 
properly equipped with those devices. Determine [Delta]CdA 
values for other trailers based on testing. Measure CdA and 
determine [Delta]CdA values as described in Sec.  
1037.526(a). You may use [Delta]CdA values from one trailer 
configuration to represent any number of additional trailers based on 
worst-case testing. This means that you may apply [Delta]CdA 
values from your measurements to any trailer models of the same 
category with drag area at or below that of the tested configuration. 
For trailers in the short dry box vans and short refrigerated box vans 
that are not 28 feet long, apply the [Delta]CdA value 
established for a comparable 28-foot trailer model; you may use the 
same devices designed for 28-foot trailers or you may adapt those 
devices as appropriate for the different trailer length, consistent 
with good engineering judgment. For example, 48-foot trailers may use 
longer side skirts than the skirts that were tested with a 28-foot 
trailer. Trailer and device manufacturers may seek preliminary approval 
for these adaptations. Determine bin levels based on 
[Delta]CdA test results as described in the following table:

  Table 2 of Sec.   1037.515--Bin Determinations for Trailers Based on
                        Aerodynamic Test Results
                          [[Delta]CdA in m\2\]
------------------------------------------------------------------------
                                                            and use the
    If a trailer's measured       designate the trailer      following
      [Delta]CdA is . . .                as . . .            value for
                                                            [Delta]CdA
------------------------------------------------------------------------
<=0.09.........................  Bin I..................             0.0
0.10-0.39......................  Bin II.................             0.1
0.40-0.69......................  Bin III................             0.4
0.70-0.99......................  Bin IV.................             0.7

[[Page 74074]]

 
1.00-1.39......................  Bin V..................             1.0
1.40-1.79......................  Bin VI.................             1.4
>1.80..........................  Bin VII................             1.8
------------------------------------------------------------------------

    (d) Weight reduction. Determine weight reduction for a trailer 
configuration by summing all applicable values, as follows:
    (1) Determine weight reduction for using lightweight materials for 
wheels as described in Sec.  1037.520(e).
    (2) Apply weight reductions for other components made with light-
weight materials as shown in the following table:

       Table 3 of Sec.   1037.515--Weight Reductions for Trailers
                                [pounds]
------------------------------------------------------------------------
                                                              Weight
           Component                     Material            reduction
                                                             (pounds)
------------------------------------------------------------------------
Structure for Suspension         Aluminum...............             280
 Assembly \1\.
Hub and Drum (per axle)........  Aluminum...............              80
Floor \2\......................  Aluminum...............             375
Floor \2\......................  Composite (wood and                 245
                                  plastic).
Floor Crossmembers \2\.........  Aluminum...............             250
Landing Gear...................  Aluminum...............              50
Rear Door......................  Aluminum...............             187
Rear Door Surround.............  Aluminum...............             150
Roof Bows......................  Aluminum...............             100
Side Posts.....................  Aluminum...............             300
Slider Box.....................  Aluminum...............             150
Upper Coupler Assembly.........  Aluminum...............             430
------------------------------------------------------------------------
\1\ For tandem-axle suspension sub-frames made of aluminum, apply a
  weight reduction of 280 pounds. Use good engineering judgment to
  estimate a weight reduction for using aluminum sub-frames with other
  axle configurations.
\2\ Calculate a smaller weight reduction for short trailers by
  multiplying the indicated values by 0.528 (28/53).

    (e) Off-cycle. You may apply the off-cycle provisions of Sec.  
1037.610 to trailers as follows:
    (1) You may account for weight reduction based on measured values 
instead of using paragraph (d) of this section. Quantify the weight 
reduction by measuring the weight of a trailer in a certified 
configuration and comparing it to the weight of an equivalent trailer 
without weight-reduction technologies. This qualifies as A to B testing 
under Sec.  1037.610. Use good engineering judgment to select an 
equivalent trailer representing a baseline configuration. Use the 
calculated weight reduction in Eq. 1037.515-1 to calculate the 
trailer's CO2 emission rate.
    (2) If your off-cycle technology reduces emissions in a way that is 
proportional to measured emissions as described in Sec.  
1037.610(b)(1), multiply the trailer's CO2 emission rate by 
the appropriate improvement factor.
    (3) If your off-cycle technology does not yield emission reductions 
that are proportional to measured emissions, as described in Sec.  
1037.610(b)(2), calculate an adjusted CO2 emission rate for 
your trailers by subtracting the appropriate off-cycle credit.
    (4) Note that these off-cycle provisions do not apply for trailers 
subject to design standards.


Sec.  1037.520  Modeling CO2 emissions to show compliance 
for vocational vehicles and tractors.

    This section describes how to use the Greenhouse gas Emissions 
Model (GEM) (incorporated by reference in Sec.  1037.810) to show 
compliance with the CO2 standards of Sec. Sec.  1037.105 and 
1037.106 for vocational vehicles and tractors. Use GEM version 2.0.1 to 
demonstrate compliance with Phase 1 standards; use GEM Phase 2, Version 
3.0 to demonstrate compliance with Phase 2 standards. Use good 
engineering judgment when demonstrating compliance using GEM. See Sec.  
1037.515 for calculation procedures for demonstrating compliance with 
trailer standards.
    (a) General modeling provisions. To run GEM, enter all applicable 
inputs as specified by the model.
    (1) GEM inputs apply for Phase 1 standards as follows:
    (i) Model year and regulatory subcategory (see Sec.  1037.230).
    (ii) Coefficient of aerodynamic drag or drag area, as described in 
paragraph (b) of this section (tractors only).
    (iii) Steer and drive tire rolling resistance, as described in 
paragraph (c) of this section.
    (iv) Vehicle speed limit, as described in paragraph (d) of this 
section (tractors only).
    (v) Vehicle weight reduction, as described in paragraph (e) of this 
section (tractors only for Phase 1).
    (vi) Automatic engine shutdown systems, as described in Sec.  
1037.660 (only for Class 8 sleeper cabs). Enter a GEM input value of 
5.0 g/ton-mile, or an adjusted value as specified in Sec.  1037.660.
    (2) For Phase 2 vehicles, the GEM inputs described in paragraphs 
(a)(1)(i) through (v) of this section continue to apply. Note that the 
provisions related to vehicle speed limiters and automatic engine 
shutdown systems are available for vocational vehicles in Phase 2. The

[[Page 74075]]

rest of this section describes additional GEM inputs for demonstrating 
compliance with Phase 2 standards. Simplified versions of GEM apply for 
limited circumstances as follows:
    (i) You may use default engine fuel maps for glider kits as 
described in Sec.  1037.635.
    (ii) If you certify vehicles to the custom-chassis standards 
specified in Sec.  1037.105(h), run GEM by identifying the vehicle type 
and entering ``NA'' instead of what would otherwise apply for, tire 
revolutions per mile, engine information, transmission information, 
drive axle ratio, axle efficiency, and aerodynamic improvement as 
specified in paragraphs (c)(1), (f), (g)(1), (g)(3), (i), and (m) of 
this section, respectively. Incorporate other GEM inputs as specified 
in this section.
    (b) Coefficient of aerodynamic drag and drag area for tractors. 
Determine the appropriate drag area, CdA, for tractors as 
described in this paragraph (b). Use the recommended method or an 
alternate method to establish a value for CdA expressed in 
m\2\ to one decimal place, as specified in Sec.  1037.525. Where we 
allow you to group multiple configurations together, measure 
CdA of the worst-case configuration.
    (1) Except as specified in paragraph (b)(2) of this section, 
determine the Phase 1 bin level for your vehicle based on measured 
CdA values as shown in the following tables:CdA

                      Table 1 of Sec.   1037.520--Cd Inputs for Phase 1 High-Roof Tractors
----------------------------------------------------------------------------------------------------------------
                                                                                      If your
                                                                                     measured
                 Tractor type                              Bin level                [Delta]CdA     Then your Cd
                                                                                   (m\2\) is . .  input is . . .
                                                                                         .
----------------------------------------------------------------------------------------------------------------
High-Roof Day Cabs...........................  Bin I............................          >= 8.0            0.79
                                               Bin II...........................         7.1-7.9            0.72
                                               Bin III..........................         6.2-7.0            0.63
                                               Bin IV...........................         5.6-6.1            0.56
                                               Bin V............................          <= 5.5            0.51
High-Roof Sleeper Cabs.......................  Bin I............................          >= 7.6            0.75
                                               Bin II...........................         6.8-7.5            0.68
                                               Bin III..........................         6.3-6.7            0.60
                                               Bin IV...........................         5.6-6.2            0.52
                                               Bin V............................           <=5.5            0.47
----------------------------------------------------------------------------------------------------------------


                Table 2 of Sec.   1037.520--Cd Inputs for Phase 1 Low-Roof and Mid-Roof Tractors
----------------------------------------------------------------------------------------------------------------
                                                                                      If your
                                                                                   measured CdA    Then your Cd
                 Tractor type                              Bin level               (m\2\) is . .  input is . . .
                                                                                         .
----------------------------------------------------------------------------------------------------------------
Low-Roof Day and Sleeper Cabs................  Bin I............................          >= 5.1            0.77
                                               Bin II...........................          <= 5.0            0.71
Mid-Roof Day and Sleeper Cabs................  Bin I............................          >= 5.6            0.87
                                               Bin II...........................          <= 5.5            0.82
----------------------------------------------------------------------------------------------------------------

    (2) For Phase 1 low- and mid-roof tractors, you may instead 
determine your drag area bin based on the drag area bin of an 
equivalent high-roof tractor. If the high-roof tractor is in Bin I or 
Bin II, then you may assume your equivalent low- and mid-roof tractors 
are in Bin I. If the high-roof tractor is in Bin III, Bin IV, or Bin V, 
then you may assume your equivalent low- and mid-roof tractors are in 
Bin II.
    (3) For Phase 2 tractors other than heavy-haul tractors, determine 
bin levels and CdA inputs as follows:
    (i) Determine bin levels for high-roof tractors based on 
aerodynamic test results as described in the following table:

                     Table 3 of Sec.   1037.520--Bin Determinations for Phase 2 High-Roof Tractors Based on Aerodynamic Test Results
                                                                      [CdA in m\2\]
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Tractor type                     Bin I          Bin II          Bin III         Bin IV           Bin V          Bin VI          Bin VII
--------------------------------------------------------------------------------------------------------------------------------------------------------
Day Cabs................................           >=7.2         6.6-7.1         6.0-6.5         5.5-5.9         5.0-5.4         4.5-4.9           <=4.4
Sleeper Cabs............................           >=6.9         6.3-6.8         5.7-6.2         5.2-5.6         4.7-5.1         4.2-4.6           <=4.1
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (ii) For low- and mid-roof tractors, you may either use the same 
bin level that applies for an equivalent high-roof tractor as shown in 
Table 3 of this section, or you may determine your bin level based on 
aerodynamic test results as described in Table 4 of this section.

[[Page 74076]]



               Table 4 of Sec.   1037.520--Bin Determinations for Phase 2 Low-Roof and Mid-Roof Tractors Based on Aerodynamic Test Results
                                                                      [CdA in m\2\]
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Tractor type                     Bin I          Bin II          Bin III         Bin IV           Bin V          Bin VI          Bin VII
--------------------------------------------------------------------------------------------------------------------------------------------------------
Low-Roof Cabs...........................           >=5.4         4.9-5.3        44.5-4.8         4.1-4.4         3.8-4.0         3.5-3.7           <=3.4
Mid-Roof Cabs...........................           >=5.9         5.5-5.8         5.1-5.4         4.7-5.0         4.4-4.6         4.1-4.3           <=4.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (iii) Determine the CdA input according to the tractor's 
bin level as described in the following table:

                                        Table 5 of Sec.   1037.520--Phase 2 CdA Tractor Inputs Based on Bin Level
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Tractor type                     Bin I          Bin II          Bin III         Bin IV           Bin V          Bin VI          Bin VII
--------------------------------------------------------------------------------------------------------------------------------------------------------
High-Roof Day Cabs......................            7.45            6.85            6.25            5.70            5.20            4.70            4.20
High-Roof Sleeper Cabs..................            7.15             655            5.95            5.40            4.90            4.40            3.90
Low-Roof Cabs...........................            6.00            5.60            5.15            4.75            4.40            4.10            3.80
Mid-Roof Cabs...........................            7.00            6.65            6.25            5.85            5.50            5.20            4.90
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (4) Note that, starting in model year 2027, GEM internally reduces 
CdA for high-roof tractors by 0.3 m\2\ to simulate adding a 
rear fairing to the standard trailer.
    (c) Tire revolutions per mile and rolling resistance. You must have 
a tire revolutions per mile (TRPM) and a tire rolling resistance level 
(TRRL) for each tire configuration. For purposes of this section, you 
may consider tires with the same SKU number to be the same 
configuration. Determine TRRL input values separately for drive and 
steer tires; determine TRPM only for drive tires.
    (1) Use good engineering judgment to determine a tire's revolutions 
per mile to the nearest whole number as specified in SAE J1025 
(incorporated by reference in Sec.  1037.810). Note that for tire sizes 
that you do not test, we will treat your analytically derived 
revolutions per mile the same as test results, and we may perform our 
own testing to verify your values. We may require you to test a sample 
of additional tire sizes that we select.
    (2) Measure tire rolling resistance in kg per metric ton as 
specified in ISO 28580 (incorporated by reference in Sec.  1037.810), 
except as specified in this paragraph (c). Use good engineering 
judgment to ensure that your test results are not biased low. You may 
ask us to identify a reference test laboratory to which you may 
correlate your test results. Prior to beginning the test procedure in 
Section 7 of ISO 28580 for a new bias-ply tire, perform a break-in 
procedure by running the tire at the specified test speed, load, and 
pressure for 60  2 minutes.
    (3) For each tire design tested, measure rolling resistance of at 
least three different tires of that specific design and size. Perform 
the test at least once for each tire. Calculate the arithmetic mean of 
these results to the nearest 0.1 kg/tonne and use this value or any 
higher value as your GEM input for TRRL. You must test at least one 
tire size for each tire model, and may use engineering analysis to 
determine the rolling resistance of other tire sizes of that model. 
Note that for tire sizes that you do not test, we will treat your 
analytically derived rolling resistances the same as test results, and 
we may perform our own testing to verify your values. We may require 
you to test a small sub-sample of untested tire sizes that we select.
    (4) If you obtain your test results from the tire manufacturer or 
another third party, you must obtain a signed statement from the party 
supplying those test results to verify that tests were conducted 
according to the requirements of this part. Such statements are deemed 
to be submissions to EPA.
    (5) For tires marketed as light truck tires that have load ranges 
C, D, or E, use as the GEM input TRRL multiplied by 0.87.
    (6) For vehicles with at least three drive axles or for vehicles 
with more than three axles total, use good engineering judgment to 
combine tire rolling resistance into three values (steer, drive 1, and 
drive 2) for use in GEM. This may require performing a weighted average 
of tire rolling resistance from multiple axles based on the typical 
load on each axle.
    (7) For vehicles with a single rear axle, enter ``NA'' as the TRRL 
value for drive axle 2.
    (d) Vehicle speed limit. If the vehicles will be equipped with a 
vehicle speed limiter, input the maximum vehicle speed to which the 
vehicle will be limited (in miles per hour rounded to the nearest 0.1 
mile per hour) as specified in Sec.  1037.640. Use good engineering 
judgment to ensure the limiter is tamper resistant. We may require you 
to obtain preliminary approval for your designs.
    (e) Vehicle weight reduction. Develop a weight-reduction as a GEM 
input as described in this paragraph (e). Enter the sum of weight 
reductions as described in this paragraph (e), or enter zero if there 
is no weight reduction. For purposes of this paragraph (e), high-
strength steel is steel with tensile strength at or above 350 MPa.
    (1) Vehicle weight reduction inputs for wheels are specified 
relative to dual-wide tires with conventional steel wheels. For 
purposes of this paragraph (e)(1), an aluminum alloy qualifies as 
light-weight if a dual-wide drive wheel made from this material weighs 
at least 21 pounds less than a comparable conventional steel wheel. The 
inputs are listed in Table 6 of this section. For example, a tractor or 
vocational vehicle with aluminum steer wheels and eight (4 x 2) dual-
wide aluminum drive wheels would have an input of 210 pounds (2 x 21 + 
8 x 21).

[[Page 74077]]



       Table 6 of Sec.   1037.520--Wheel-Related Weight Reductions
------------------------------------------------------------------------
                                  Weight reduction--  Weight reduction--
   Weight-reduction technology      Phase 1 (lb per     Phase 2 (lb per
                                        wheel)              wheel)
------------------------------------------------------------------------
Wide-Base Single Drive Tire
 with: \1\
    Steel Wheel.................                  84                  84
    Aluminum Wheel..............                 139                 147
    Light-Weight Aluminum Alloy                  147                 147
     Wheel......................
Wide-Base Single Trailer Tire
 with: \1\
    Steel Wheel.................  ..................                  84
    Aluminum or Aluminum Alloy    ..................                 131
     Wheel......................
Steer Tire, Dual-wide Drive
 Tire, or Dual-wide Trailer Tire
 with:
    High-Strength Steel Wheel...                   8                   8
    Aluminum Wheel..............                  21                  25
    Light-Weight Aluminum Alloy                   30                  25
     Wheel......................
------------------------------------------------------------------------
\1\ The weight reduction for wide-base tires accounts for reduced tire
  weight relative to dual-wide tires.

    (2) Weight reduction inputs for tractor components other than 
wheels are specified in the following table:

     Table 7 of Sec.   1037.520--Nonwheel-Related Weight Reductions From Alternative Materials for Tractors
                                                    [Pounds]
----------------------------------------------------------------------------------------------------------------
                                                                                   High-strength
                  Weight reduction technologies                      Aluminum          steel       Thermoplastic
----------------------------------------------------------------------------------------------------------------
Door............................................................              20               6  ..............
Roof............................................................              60              18  ..............
Cab rear wall...................................................              49              16  ..............
Cab floor.......................................................              56              18  ..............
Hood Support Structure System...................................              15               3  ..............
Hood and Front Fender...........................................  ..............  ..............              65
Day Cab Roof Fairing............................................  ..............  ..............              18
Sleeper Cab Roof Fairing........................................              75              20              40
Aerodynamic Side Extender.......................................  ..............  ..............              10
Fairing Support Structure System................................              35               6  ..............
Instrument Panel Support Structure..............................               5               1  ..............
Brake Drums--Drive (set of 4)...................................             140              74  ..............
Brake Drums--Non Drive (set of 2)...............................              60              42  ..............
Frame Rails.....................................................             440              87  ..............
Crossmember--Cab................................................              15               5  ..............
Crossmember--Suspension.........................................              25               6  ..............
Crossmember--Non Suspension (3).................................              15               5  ..............
Fifth Wheel.....................................................             100              25  ..............
Radiator Support................................................              20               6  ..............
Fuel Tank Support Structure.....................................              40              12  ..............
Steps...........................................................              35               6  ..............
Bumper..........................................................              33              10  ..............
Shackles........................................................              10               3  ..............
Front Axle......................................................              60              15  ..............
Suspension Brackets, Hangers....................................             100              30  ..............
Transmission Case...............................................              50              12  ..............
Clutch Housing..................................................              40              10  ..............
Fairing Support Structure System................................              35               6  ..............
Drive Axle Hubs (set of 4)......................................              80              20  ..............
Non Drive Hubs (2)..............................................              40               5  ..............
Two-piece driveshaft............................................              20               5  ..............
Transmission/Clutch Shift Levers................................              20               4  ..............
----------------------------------------------------------------------------------------------------------------

    (3) Weight-reduction inputs for vocational-vehicle components other 
than wheels are specified in the following table:

[[Page 74078]]



Table 8 of Sec.   1037.520--Nonwheel-Related Weight Reductions From Alternative Materials for Phase 2 Vocational
                                                    Vehicles
                                                    [Pounds]
----------------------------------------------------------------------------------------------------------------
                                                                                   Vehicle type
               Component                        Material         -----------------------------------------------
                                                                     Light HDV      Medium HDV       Heavy HDV
----------------------------------------------------------------------------------------------------------------
Axle Hubs--Non-Drive..................  Aluminum................                40                            40
----------------------------------------------------------------------------------------------------------------
Axle Hubs--Non-Drive..................  High Strength Steel.....                 5                             5
Axle--Non-Drive.......................  Aluminum................                60                            60
Axle--Non-Drive.......................  High Strength Steel.....                15                            15
Brake Drums--Non-Drive................  Aluminum................                60                            60
Brake Drums--Non-Drive................  High Strength Steel.....                42                            42
Axle Hubs--Drive......................  Aluminum................                40                            80
Axle Hubs--Drive......................  High Strength Steel.....                10                            20
Brake Drums--Drive....................  Aluminum................                70                           140
Brake Drums--Drive....................  High Strength Steel.....                37                            74
Suspension Brackets, Hangers..........  Aluminum................                67                           100
----------------------------------------------------------------------------------------------------------------
Suspension Brackets, Hangers..........  High Strength Steel.....                20                            30
----------------------------------------------------------------------------------------------------------------
Crossmember--Cab......................  Aluminum................              10              15              15
Crossmember--Cab......................  High Strength Steel.....               2               5               5
Crossmember--Non-Suspension...........  Aluminum................              15              15              15
Crossmember--Non-Suspension...........  High Strength Steel.....               5               5               5
Crossmember--Suspension...............  Aluminum................              15              25              25
Crossmember--Suspension...............  High Strength Steel.....               6               6               6
Driveshaft............................  Aluminum................              12              40              50
Driveshaft............................  High Strength Steel.....               5              10              12
Frame Rails...........................  Aluminum................             120             300             440
Frame Rails...........................  High Strength Steel.....              40              40              87
----------------------------------------------------------------------------------------------------------------

    (4) Apply vehicle weight inputs for changing technology 
configurations as follows:
    (i) For Class 8 tractors or for Class 8 vocational vehicles with a 
permanent 6 x 2 axle configuration, apply a weight reduction input of 
300 pounds. This does not apply for coach buses certified to custom-
chassis standards under Sec.  1037.105(h).
    (ii) For Class 8 tractors with 4 x 2 axle configuration, apply a 
weight reduction input of 400 pounds.
    (iii) For tractors with installed engines with displacement below 
14.0 liters, apply a weight reduction of 300 pounds.
    (iv) For tractors with single-piece driveshafts with a total length 
greater than 86 inches, apply a weight reduction of 43 pounds for steel 
driveshafts and 63 pounds for aluminum driveshafts.
    (5) You may ask to apply the off-cycle technology provisions of 
Sec.  1037.610 for weight reductions not covered by this paragraph (e).
    (f) Engine characteristics. Enter information from the engine 
manufacturer to describe the installed engine and its operating 
parameters as described in 40 CFR 1036.510. The fuel-mapping 
information must apply for the vehicle's GVWR; for example, if you 
install a medium heavy-duty engine in a Class 8 vehicle, the engine 
must have additional fuel-mapping information for the heavier vehicle. 
Note that you do not need fuel consumption at idle for tractors.
    (g) Vehicle characteristics. Enter the following information to 
describe and the vehicle and its operating parameters:
    (1) Transmission make, model, and type. Also identify the gear 
ratio for every available forward gear to two decimal places, and 
identify the lowest gear involving a locked torque converter, if 
applicable. For vehicles with a manual transmission, GEM applies a 2% 
emission increase relative to automated manual transmissions. If your 
vehicle has a dual-clutch transmission, use good engineering judgment 
to determine if it can be accurately represented in GEM as an automated 
manual transmission. We may require you to perform a powertrain test 
with dual-clutch transmissions to show that they can be properly 
simulated as an automated manual transmission.
    (2) Drive axle configuration. Select a drive axle configuration to 
represent your vehicle for modeling.
    (i) 4 x 2: One drive axle and one non-drive axle.
    (ii) 6 x 2: One drive axle and two non-drive axles.
    (iii) 6 x 4: Two or more drive axles, or more than three total 
axles. Note that this includes, for example, a vehicle with two drive 
axles out of four total axles (otherwise known as an 8x4 
configuration).
    (iv) 6 x 4D: An axle that can automatically switch between 6 x 2 
and 6 x 4 configuration. When the axle is in the 6 x 2 configuration 
the input and output of the disconnectable axle must be mechanically 
disconnected from the drive shaft and the wheels to qualify.
    (3) Drive axle ratio, ka. If a vehicle is designed with 
two or more user-selectable axle ratios, use the drive axle ratio that 
is expected to be engaged for the greatest driving distance. If the 
vehicle does not have a drive axle, such as a hybrid vehicle with 
direct electric drive, let ka = 1.
    (4) GEM inputs associated with powertrain testing include 
powertrain family, transmission calibration identifier, test data from 
Sec.  1037.550, and the powertrain test configuration (dynamometer 
connected to transmission output or wheel hub). You do not need to 
identify or provide inputs for transmission gear ratios, fuel map data, 
or engine torque curves, which would otherwise be required under 
paragraph (f) of this section.
    (h) Idle-reduction technologies. Identify whether your vehicle has 
qualifying idle-reduction technologies, subject to the qualifying 
criteria in Sec.  1037.660, as follows:
    (1) Stop-start technology and automatic engine shutdown systems

[[Page 74079]]

apply for vocational vehicles. See paragraph (j) of this section for 
automatic engine shutdown systems for tractors.
    (2) Neutral idle applies for tractors and vocational vehicles.
    (i) Axle and transmission efficiency. You may use axle efficiency 
maps as described in Sec.  1037.560 and transmission efficiency maps as 
described in Sec.  1037.565 to replace the default values in GEM. If 
you obtain your test results from the axle manufacturer, transmission 
manufacturer, or another third party, you must obtain a signed 
statement from the party supplying those test results to verify that 
tests were conducted according to the requirements of this part. Such 
statements are deemed to be submissions to EPA.
    (j) Additional reduction technologies. Enter input values in GEM as 
follows to characterize the percentage CO2 emission 
reduction corresponding to certain technologies and vehicle 
configurations, or enter 0:
    (1) Intelligent controls. Enter 2 for tractors with predictive 
cruise control. This includes any cruise control system that 
incorporates satellite-based global-positioning data for controlling 
operator demand. For other vehicles, enter 1.5 if they have neutral 
coasting, unless good engineering judgment indicates that a lower 
percentage should apply.
    (2) Accessory load. Enter the following values related to accessory 
loads; if more than one item applies, enter the sum of those values:
    (i) If vocational vehicles have electrically powered pumps for 
steering, enter 0.5 for vocational vehicles certified with the Regional 
duty cycle, and enter 1 for tractors and other vocational vehicles.
    (ii) If tractors have electrically powered pumps for both steering 
and engine cooling, enter 1.
    (iii) If vehicles have a high-efficiency air conditioning 
compressor, enter 0.5 for tractors and vocational Heavy HDV, and enter 
1 for other vocational vehicles. This includes mechanically powered 
compressors meeting the specifications described in 40 CFR 86.1868-
12(h)(5), and all electrically powered compressors.
    (3) Tire-pressure systems. Enter 1.2 for vehicles with automatic 
tire inflation systems on all axles (1.1 for Multi-Purpose and Urban 
vocational vehicles). Enter 1.0 for vehicles with tire pressure 
monitoring systems on all axles (0.9 for Multi-Purpose and Urban 
vocational vehicles). If vehicles use a mix of the two systems, treat 
them as having only tire pressure monitoring systems.
    (4) Extended-idle reduction. Enter values as shown in the following 
table for sleeper cabs equipped with idle-reduction technology meeting 
the requirements of Sec.  1037.660 that are designed to automatically 
shut off the main engine after 300 seconds or less:

      Table 9 of Sec.   1037.520--GEM Input Values for AES Systems
------------------------------------------------------------------------
                                               GEM input values
             Technology              -----------------------------------
                                         Adjustable     Tamper-resistant
------------------------------------------------------------------------
Standard AES system.................                 1                 4
With diesel APU.....................                 3                 4
With battery APU....................                 5                 6
With automatic stop-start...........                 3                 3
Fuel-operated heater................                 2                 3
------------------------------------------------------------------------

    (5) Other. Additional GEM inputs may apply as follows:
    (i) Enter 1.7 and 0.9, respectively, for school buses and coach 
buses that have at least seven available forward gears.
    (ii) If we approve off-cycle technology under Sec.  1037.610 in the 
form of an improvement factor, enter the improvement factor expressed 
as a percentage reduction in CO2 emissions. (Note: In the 
case of approved off-cycle technologies whose benefit is quantified as 
a g/ton-mile credit, apply the credit to the GEM result, not as a GEM 
input value.)
    (k) Vehicles with hybrid power take-off. For vocational vehicles, 
determine the delta PTO emission result of your engine and hybrid power 
take-off system as described in Sec.  1037.540.
    (l) [Reserved]
    (m) Aerodynamic improvements for vocational vehicles. For 
vocational vehicles certified using the Regional duty cycle, enter 
[Delta]CdA values to account for using aerodynamic devices 
as follows:
    (1) Enter 0.2 for vocational vehicles with an installed rear 
fairing if the vehicle is at least 7 m long with a minimum frontal area 
of 8 m\2\.
    (2) For vehicles at least 11 m long with a minimum frontal area of 
9 m\2\, enter 0.5 if the vehicle has both skirts and a front fairing, 
and enter 0.3 if it has only one of those devices.
    (3) You may determine input values for these or other technologies 
based on aerodynamic measurements as described in Sec.  1037.527.
    (n) Alternate fuels. For fuels other than those identified in GEM, 
perform the simulation by identifying the vehicle as being diesel-
fueled if the engine is subject to the compression-ignition standard, 
or as being gasoline-fueled if the engine is subject to the spark-
ignition standards. Correct the engine or powertrain fuel map for mass-
specific net energy content as described in 40 CFR 1036.535(b).


Sec.  1037.525  Aerodynamic measurements for tractors.

    This section describes a methodology for quantifying aerodynamic 
drag for use in determining input values for tractors as described in 
Sec.  1037.520.
    (a) General provisions. The GEM input for a tractor's aerodynamic 
performance is a Cd value for Phase 1 and a CdA 
value for Phase 2. The input value is measured or calculated for a 
tractor in a specific test configuration with a trailer, such as a 
high-roof tractor with a box van meeting the requirements for the 
standard trailer.
    (1) Aerodynamic measurements may involve any of several different 
procedures. Measuring with different procedures introduces variability, 
so we identify the coastdown method in Sec.  1037.528 as the primary 
(or reference) procedure. You may use other procedures with our advance 
approval as described in paragraph (d) of this section, but we require 
that you adjust your test results from other test methods to correlate 
with coastdown test results. All adjustments must be consistent with 
good engineering judgment. Submit information describing how you 
quantify aerodynamic drag from coastdown testing, whether or not you 
use an alternate method.
    (2) Test high-roof tractors with a standard trailer as described in 
Sec.  1037.501(g)(1). Note that the standard

[[Page 74080]]

trailer for Phase 1 tractors is different from that of later model 
years. Note also that GEM may model a different configuration than the 
test configuration, but accounts for this internally. Test low-roof and 
mid-roof tractors without a trailer; however, you may test low-roof and 
mid-roof tractors with a trailer to evaluate off-cycle technologies.
    (b) Adjustments to correlate with coastdown testing. Adjust 
aerodynamic drag values from alternate methods to be equivalent to the 
corresponding values from coastdown measurements as follows:
    (1) Determine the functional relationship between your alternate 
method and coastdown testing. Unless good engineering judgment dictates 
otherwise, assume that coastdown drag is proportional to drag measured 
using alternate methods. This means you may apply a constant adjustment 
factor, Falt-aero, for a given alternate drag measurement 
method using the following equation, where the effective yaw angle, 
[psi]eff, is assumed to be zero degrees for Phase 1 and is 
determined from coastdown test results for Phase 2:
[GRAPHIC] [TIFF OMITTED] TR25OC16.089

    (2) Determine Falt-aero by performing coastdown testing 
and applying your alternate method on the same vehicles. Consider all 
applicable test data including data collected during selective 
enforcement audits. Where you have test results from multiple vehicles 
expected to have the same Falt-aero, you may either average 
the Falt-aero values or select any greater value. Unless we 
approve another vehicle, one vehicle must be a Class 8 high-roof 
sleeper cab with a full aerodynamics package pulling a standard 
trailer. Where you have more than one tractor model meeting these 
criteria, use the tractor model with the highest projected sales. If 
you do not have such a tractor model, you may use your most comparable 
tractor model with our prior approval. In the case of alternate methods 
other than those specified in this subpart, good engineering judgment 
may require you to determine your adjustment factor based on results 
from more than the specified minimum number of vehicles.
    (3) Measure the drag area using your alternate method for a Phase 2 
tractor used to determine Falt-aero with testing at yaw 
angles of 0[deg], 1[deg], 3[deg], 4.5[deg], 6[deg], and 9[deg] (you may 
include additional angles), using direction conventions described in 
Figure 2 of SAE J1252 (incorporated by reference in Sec.  1037.810). 
Also, determine the drag area at the coastdown effective yaw angle, 
CdAeffective-yaw-alt, by taking the average drag 
area at [psi]eff and -[psi]eff for your vehicle 
using the same alternate method.
    (4) For Phase 2 testing, determine separate values of 
Falt-aero for a minimum of one high-roof day cab and one 
high-roof sleeper cab for 2021, 2024, and 2027 model years based on 
testing as described in paragraph (b)(2) of this section (six tests 
total). For any untested tractor models, apply the value of 
Falt-aero from the tested tractor model that best represents 
the aerodynamic characteristics of the untested tractor model, 
consistent with good engineering judgment. Testing under this paragraph 
(b)(4) continues to be valid for later model years until you change the 
tractor model in a way that causes the test results to no longer 
represent production vehicles. You must also determine unique values of 
Falt-aero for low-roof and mid-roof tractors if you 
determine CdA values based on low or mid-roof tractor 
testing as shown in Table 4 of Sec.  1037.520. For Phase 1 testing, if 
good engineering judgment allows it, you may calculate a single, 
constant value of Falt-aero for your whole product line by 
dividing the coastdown drag area, CdAcoastdown, 
by CdAalt.
    (5) Determine Falt-aero to at least three decimal 
places. For example, if your coastdown testing results in a drag area 
of 6.430, but your wind tunnel method results in a drag area of 6.200, 
Falt-aero would be 1.037 (or a higher value you declare).
    (6) If a tractor and trailer cannot be configured to meet the gap 
requirements, test with the trailer positioned as close as possible to 
the specified gap dimension and use good engineering judgment to 
correct the results to be equivalent to a test configuration meeting 
the specified gap dimension.
    (c) Yaw sweep corrections. Aerodynamic features can have a 
different effectiveness for reducing wind-averaged drag than is 
predicted by zero-yaw drag. The following procedures describe how to 
determine a tractor's CdA values to account for wind-
averaged drag and differences from coastdown testing:
    (1) For Phase 2 testing with an alternate method, apply the 
following method using your alternate method for aerodynamic testing:
    (i) For all testing, calculate the wind-averaged drag area from the 
alternate method, CdAwa-alt, using an average of 
measurements at -4.5 and +4.5 degrees.
    (ii) Determine your wind-averaged drag area, 
CdAwa, rounded to one decimal place, using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.090

    (2) For Phase 2 coastdown test results, apply the following method:
    (i) For all coastdown testing, determine your effective yaw angle 
from coastdown, CdAeffective-yaw-coastdown.
    (ii) Use an alternate method to calculate the ratio of the wind-
averaged drag area (using an average of measurements at -4.5 and +4.5 
degrees, CdAwa-alt) to the drag area at the 
effective yaw angle, CdAeffective-yaw.
    (iii) Determine your wind-averaged drag area, 
CdAwa, rounded to one decimal place, using the 
following equation:

[[Page 74081]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.091

    (3) Different approximations apply for Phase 1. For Phase 1 
testing, you may correct your zero-yaw drag area as follows if the 
ratio of the zero-yaw drag area divided by yaw-sweep drag area for your 
vehicle is greater than 0.8065 (which represents the ratio expected for 
a typical Class 8 high-roof sleeper cab):
    (i) Determine the zero-yaw drag area, 
CdAzero-yaw, and the yaw-sweep drag area for your 
vehicle using the same alternate method as specified in this subpart. 
Measure the drag area for 0[deg], -6[deg], and +6[deg]. Use the 
arithmetic mean of the -6[deg] and +6[deg] drag areas as the 6[deg] drag area, CdA6.
    (ii) Calculate your yaw-sweep correction factor, CFys, 
using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.092

    (iii) Calculate your corrected drag area for determining the 
aerodynamic bin by multiplying the measured zero-yaw drag area by 
CFys, as determined using Eq. 1037.525-4, as applicable. You 
may apply the correction factor to drag areas measured using other 
procedures. For example, apply CFys to drag areas measured 
using the coastdown method. If you use an alternate method, apply an 
alternate correction, Falt-aero, and calculate the final 
drag area using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.093

    (iv) You may ask us to apply CFys to similar vehicles 
incorporating the same design features.
    (v) As an alternative, you may calculate the wind-averaged drag 
area according to SAE J1252 (incorporated by reference in Sec.  
1037.810) and substitute this value into Eq. 1037.525-4 for the 6[deg] drag area.
    (d) Approval of alternate methods. You must obtain preliminary 
approval before using any method other than coastdown testing to 
quantify aerodynamic drag. We will approve your request if you show 
that your procedures produce data that are the same as or better than 
coastdown testing with respect to repeatability and unbiased 
correlation. Note that the correlation is not considered to be biased 
if there is a bias before correction, but you remove the bias using 
Falt-aero. Send your request for approval to the Designated 
Compliance Officer. Keep records of the information specified in this 
paragraph (d). Unless we specify otherwise, include this information 
with your request. You must provide any information we require to 
evaluate whether you may apply the provisions of this section. Include 
additional information related to your alternate method as described in 
Sec. Sec.  1037.530 through 1037.534. If you use a method other than 
those specified in this subpart, include all the following information, 
as applicable:
    (1) Official name/title of the procedure.
    (2) Description of the procedure.
    (3) Cited sources for any standardized procedures that the method 
is based on.
    (4) Description and rationale for any modifications/deviations from 
the standardized procedures.
    (5) Data comparing the procedure to the coastdown reference 
procedure.
    (6) Additional information specified for the alternate methods 
described in Sec. Sec.  1037.530 through 1037.534 as applicable to this 
method (e.g., source location/address, background/history).


Sec.  1037.526  Aerodynamic measurements for trailers.

    This section describes a methodology for determining aerodynamic 
drag area, CdA for use in determining input values for box 
vans as described in Sec. Sec.  1037.515 and 1037.520.
    (a) A trailer's aerodynamic performance for demonstrating 
compliance with standards is based on a [Delta]CdA value 
relative to a baseline trailer. Determine these [Delta]CdA 
values by performing A to B testing, as follows:
    (1) Determine a baseline CdA value for a standard 
tractor pulling a test trailer representing a production configuration; 
use a 53-foot test trailer to represent long trailers and a 28-foot 
test trailer to represent short trailers. Repeat this testing with the 
same tractor and the applicable baseline trailer. For testing long 
trailers, the baseline trailer is a trailer meeting the specifications 
for a Phase 1 standard trailer in Sec.  1037.501(g)(1); for testing 
refrigerated box vans, use a baseline trailer with an installed HVAC 
unit that properly represents a baseline configuration correlated with 
the production configuration. For testing short trailers, use a 28-foot 
baseline trailer with a single axle that meets the same specifications 
as the Phase 1 standard trailer, except as needed to accommodate the 
reduced trailer length.
    (2) Use good engineering judgment to perform paired tests that 
accurately demonstrate the reduction in aerodynamic drag associated 
with the improved design. For example, the gap dimension should be the 
same for all paired tests, and effective yaw angle

[[Page 74082]]

between paired tests should differ by no more than 1.0[deg].
    (3) Measure CdA in m\2\ to two decimal places. Calculate 
[Delta]CdA by subtracting the drag area for the test trailer 
from the drag area for the baseline trailer.
    (b) The default method for measuring is the wind-tunnel procedure 
as specified in Sec.  1037.530. You may test using alternate methods as 
follows:
    (1) If we approve it in advance, you may instead use one of the 
alternate methods specified in Sec. Sec.  1037.528 through 1037.532, 
consistent with good engineering judgment, which may require that you 
adjust your test results from the alternate test method to correlate 
with the primary method. If you request our approval to determine 
[Delta]CdA using an alternate method, you must submit 
additional information as described in paragraph (d) of this section.
    (2) The principles of 40 CFR 1065.10(c)(1) apply for aerodynamic 
test methods. Specifically, we may require that you use coastdown 
measurements if we determine that certain technologies are not suited 
to evaluation with wind-tunnel testing or CFD, such as nonrigid 
materials whose physical characteristics change in scaled-model 
testing. You may similarly reference 40 CFR 1065.10(c)(1) in your 
request to use coastdown testing as an alternate method.
    (c) The following provisions apply for combining multiple devices 
under this section for the purpose of certifying trailers:
    (1) If the device manufacturer establishes a [Delta]CdA 
value in a single test with multiple aerodynamic devices installed, 
trailer manufacturers may use that [Delta]CdA value directly 
for the same combination of aerodynamic devices installed on production 
trailers.
    (2) Trailer manufacturers may combine [Delta]CdA values 
for aerodynamic devices that are not tested together, as long as each 
device does not significantly impair the effectiveness of another, 
consistent with good engineering judgment. To approximate the overall 
benefit of multiple devices, calculate a composite 
[Delta]CdA value for multiple aerodynamic devices by 
applying the full [Delta]CdA value for the device with the 
greatest aerodynamic improvement, adding the second-highest 
[Delta]CdA value multiplied by 0.9, and adding any other 
[Delta]CdA values multiplied by 0.8.
    (d) You must send us a description of your plan to perform testing 
under this section before you start testing. We will evaluate whether 
plans for wind-tunnel testing meet the specifications of Sec.  
1037.530, and will tell you if you may or must use any other method to 
determine drag coefficients. We will approve your request to use an 
alternate method if you show that your procedures produce data that are 
the same as or better than wind-tunnel testing with respect to 
repeatability and unbiased correlation. Note that the correlation is 
not considered to be biased if there is a bias before correction, but 
you apply a correction to remove the bias. Send your testing plan to 
the Designated Compliance Officer. Keep records of the information 
specified in this paragraph (d). Unless we specify otherwise, include 
this information with your request. You must provide any information we 
require to evaluate whether you may apply the provisions of this 
section. Include additional information related to your alternate 
method as described in Sec. Sec.  1037.528 through 1037.534.


Sec.  1037.527  Aerodynamic measurements for vocational vehicles.

    This section describes a methodology for determining aerodynamic 
drag area, CdA, for use in determining input values for 
vocational vehicles as described in Sec.  1037.520. This measurement is 
optional.
    (a) Determine [Delta]CdA values by performing A to B 
testing as described for trailers in Sec.  1037.526, with any 
appropriate adjustments, consistent with good engineering judgment.
    (b) [Reserved]


Sec.  1037.528  Coastdown procedures for calculating drag area (CdA).

    The coastdown procedures in this section describe how to calculate 
drag area, CdA, for Phase 2 tractors, trailers, and 
vocational vehicles, subject to the provisions of Sec. Sec.  1037.525 
through 1037.527. These procedures are considered the primary 
procedures for tractors, but alternate procedures for trailers. Follow 
the provisions of Sections 1 through 9 of SAE J2263 (incorporated by 
reference in Sec.  1037.810), with the clarifications and exceptions 
described in this section. Several of these exceptions are from SAE 
J1263 (incorporated by reference in Sec.  1037.810). The coastdown 
procedures in 40 CFR 1066.310 apply instead of the provisions of this 
section for Phase 1 tractors.
    (a) The terms and variables identified in this section have the 
meaning given in SAE J1263 (incorporated by reference in Sec.  
1037.810) and J2263 unless specified otherwise.
    (b) To determine CdA values for a tractor, perform 
coastdown testing with a tractor-trailer combination using the 
manufacturer's tractor and a standard trailer. To determine 
CdA values for a trailer, perform coastdown testing with a 
tractor-trailer combination using a standard tractor. Prepare tractors 
and trailers for testing as follows:
    (1) Install instrumentation for performing the specified 
measurements.
    (2) After adding vehicle instrumentation, verify that there is no 
brake drag or other condition that prevents the wheels from rotating 
freely. Do not apply the parking brake at any point between this 
inspection and the end of the measurement procedure.
    (3) Install tires mounted on steel rims in a dual configuration 
(except for steer tires). The tires must--
    (i) Be SmartWay-Verified or have a coefficient of rolling 
resistance at or below 5.1 kg/metric ton.
    (ii) Have accumulated at least 2,000 miles but have no less than 50 
percent of their original tread depth, as specified for truck cabs in 
SAE J1263.
    (iii) Not be retreads or have any apparent signs of chunking or 
uneven wear.
    (iv) Be size 295/75R22.5 or 275/80R22.5.
    (v) Be inflated to the proper tire pressure as specified in 
Sections 6.6 and 8.1 of SAE J2263.
    (vi) Be of the same tire model for a given axle.
    (4) Perform an inspection or wheel alignment for both the tractor 
and the trailer to ensure that wheel position is within the 
manufacturer's specifications.
    (c) The test condition specifications described in Sections 7.1 
through 7.4 of SAE J1263 apply, with the following exceptions and 
additional provisions:
    (1) We recommend that you not perform coastdown testing if winds 
are expected to exceed 6.0 mi/hr.
    (2) The average of the component of the wind speed parallel to the 
road must not exceed 6.0 mi/hr. This constraint is in addition to those 
in Section 7.3 of SAE J1263.
    (3) If road grade is greater than 0.02% over the length of the test 
surface, you must determine elevation as a function of distance along 
the length of the test surface and incorporate this into the analysis.
    (4) Road grade may exceed 0.5% for limited portions of the test 
surface as long as it does not affect coastdown results, consistent 
with good engineering judgment.
    (5) The road surface temperature must be at or below 50 [deg]C. Use 
good engineering judgment to measure road surface temperature.
    (d) CdA calculations are based on measured speed values 
while the vehicle coasts down through a high-

[[Page 74083]]

speed range from 70 to 60 mi/hr, and through a low-speed range from 20 
to 10 mi/hr. Disable any vehicle speed limiters that prevent travel 
above 72 mi/hr. Measure vehicle speed at a minimum recording frequency 
of 10 Hz, in conjunction with time-of-day data. Determine vehicle speed 
using either of the following methods:
    (1) Complete coastdown runs. Operate the vehicle at a top speed 
above 72.0 mi/hr and allow the vehicle to coast down to 8.0 mi/hr or 
lower. Collect data for the high-speed range over a test segment that 
includes speeds from 72.0 down to 58.0 mi/hr, and collect data for the 
low-speed range over a test segment that includes speeds from 22.0 down 
to 8.0 mi/hr.
    (2) Split coastdown runs. Collect data during a high-speed 
coastdown while the vehicle coasts through a test segment that includes 
speeds from 72.0 mi/hr down to 58.0 mi/hr. Similarly, collect data 
during a low-speed coastdown while the vehicle coasts through a test 
segment that includes speeds from 22.0 mi/hr down to 8.0 mi/hr. Perform 
one high-speed coastdown segment or two consecutive high-speed 
coastdown segments in one direction, followed by the same number of 
low-speed coastdown segments in the same direction, and then perform 
that same number of measurements in the opposite direction. You may not 
split runs as described in Section 9.3.1 of SAE J2263 except as allowed 
under this paragraph (d)(2).
    (e) Measure wind speed, wind direction, air temperature, and air 
pressure at a recording frequency of 10 Hz, in conjunction with time-
of-day data. Use at least one stationary electro-mechanical anemometer 
and suitable data loggers meeting SAE J1263 specifications, subject to 
the following additional specifications for the anemometer placed along 
the test surface:
    (1) You must start a coastdown measurement within 24 hours after 
completing zero-wind and zero-angle calibrations.
    (2) Place the anemometer at least 50 feet from the nearest tree and 
at least 25 feet from the nearest bush (or equivalent features). 
Position the anemometer adjacent to the test surface, near the midpoint 
of the length of the track, between 2.5 and 3.0 body widths from the 
expected location of the test vehicle's centerline as it passes the 
anemometer. Record the location of the anemometer along the test track, 
to the nearest 10 feet.
    (3) Mount the anemometer at a height that is within 6 inches of 
half the test vehicle's body height.
    (4) The height of vegetation surrounding the anemometer may not 
exceed 10% of the anemometer's mounted height, within a radius equal to 
the anemometer's mounted height.
    (f) Measure air speed and relative wind direction (yaw angle) 
onboard the vehicle at a minimum recording frequency of 10 Hz, in 
conjunction with time-of-day data, using an anemometer and suitable 
data loggers that meet the requirements of Sections 5.4 of SAE J2263. 
The yaw angle must be measured to a resolution and accuracy of 0.5[deg]. Mount the anemometer such that it measures air speed at 
1.5 meters above the top of the leading edge of the trailer. If 
obstructions at the test site do not allow for this mounting height, 
then mount the anemometer such that it measures air speed at least 0.85 
meters above the top of the leading edge of the trailer.
    (g) Perform the following calculations to filter and correct 
measured data:
    (1) For any measured values not identified as outliers, use those 
measured values directly in the calculations specified in this section. 
Filter air speed, yaw angle, wind speed, wind direction, and vehicle 
speed measurements to replace outliers for every measured value as 
follows:
    (i) Determine a median measured value to represent the measurement 
point and the measurements 3 seconds before and after that point. In 
the first and last three seconds of the coastdown run, use all 
available data to determine the median measured value. The measurement 
window for determining the median value will accordingly include 61 
measurements in most cases, and will always include at least 31 
measurements (for 10 Hz recording frequency).
    (ii) Determine the median absolute deviation corresponding to each 
measurement window from paragraph (g)(1)(i) of this section. This 
generally results from calculating 61 absolute deviations from the 
median measured value and determining the median from those 61 
deviations. Calculate the standard deviation for each measurement 
window by multiplying the median absolute deviation by 1.4826; 
calculate three standard deviations by multiplying the median absolute 
deviation by 4.4478. Note that the factor 1.4826 is a statistical 
constant that relates median absolute deviations to standard 
deviations.
    (iii) A measured value is an outlier if the measured value at a 
given point differs from the median measured value by more than three 
standard deviations. Replace each outlier with the median measured 
value from paragraph (g)(1)(i) of this section. This technique for 
filtering outliers is known as the Hampel method.
    (2) For each high-speed and each low-speed segment, correct 
measured air speed using the wind speed and wind direction measurements 
described in paragraph (e) of this section as follows:
    (i) Calculate the theoretical air speed, vair,th, for 
each 10-Hz set of measurements using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.094

Where:

w = filtered wind speed.
v = filtered vehicle speed.
[oslash]w = filtered wind direction. Let 
[oslash]w = 0[deg] for air flow in the first travel 
direction, with values increasing counterclockwise. For example, if 
the vehicle starts by traveling eastbound, then [oslash]w 
= 270[deg] means a wind from the south.
[oslash]veh = the vehicle direction. Use 
[oslash]veh = 0[deg] for travel in the first direction, 
and use [oslash]veh = 180[deg] for travel in the opposite 
direction.

    Example: 
w = 7.1 mi/hr
v = 64.9 mi/hr
[oslash]w = 47.0[deg]
[oslash]veh = 0[deg]

[[Page 74084]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.095

vair,th = 69.93 mi/hr

    (ii) Perform a linear regression using paired values of 
vair,th and measured air speed, vair,meas, to 
determine the air-speed correction coefficients, [alpha]0 
and [alpha]1, based on the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.096

    (iii) Correct each measured value of air speed using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.097

    (3) Correct measured air direction using the wind speed and wind 
direction measurements described in paragraph (e) of this section as 
follows:
    (i) Calculate the theoretical air direction, 
[psi]air,th, using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.098

    Example: 
w = 7.1 mi/hr
v = 64.9 mi/hr
[oslash]w = 47.0[deg]
[oslash]veh = 0[deg]
[GRAPHIC] [TIFF OMITTED] TR25OC16.099

[psi]air,th = 4.26[deg]

    (ii) Perform a linear regression using paired values of 
[psi]air,th and measured air direction, 
[psi]air,meas, to determine the air-direction correction 
coefficients, [beta]0 and [beta]1, based on the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.100

    (iii) Correct each measured value of air direction using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.101


[[Page 74085]]


    (h) Determine drag area, CdA, using the following 
procedure instead of the procedure specified in Section 10 of SAE 
J1263:
    (1) Calculate the vehicle's effective mass, Me, to 
account for rotational inertia by adding 56.7 kg to the measured 
vehicle mass, M, (in kg) for each tire making road contact.
    (2) Operate the vehicle and collect data over the high-speed range 
and low-speed range as specified in paragraph (d)(1) or (2) of this 
section. If the vehicle has a speed limiter that prevents it from 
exceeding 72 mi/hr, you must disable the speed limiter for testing.
    (3) Calculate mean vehicle speed at each speed start point (70 and 
20 mi/hr) and end point (60 and 10 mi/hr) as follows:
    (i) Calculate the mean vehicle speed to represent the start point 
of each speed range as the arithmetic average of measured speeds 
throughout the speed interval defined as 2.00 mi/hr above the nominal 
starting speed point to 2.00 mi/hr below the nominal starting speed 
point, expressed to at least two decimal places. Determine the 
timestamp corresponding to the starting point of each speed range as 
the time midpoint of the 2.00 mi/hr speed interval.
    (ii) Repeat the calculations described in paragraph (h)(3)(i) of 
this section corresponding to the end point speed (60 or 10 mi/hr) to 
determine the time at which the vehicle reaches the end speed, and the 
mean vehicle speed representing the end point of each speed range.
    (iii) If you incorporate grade into your calculations, use the 
average values for the elevation and distance traveled over each 
interval.
    (4) Calculate the road-load force, F, for each speed range using 
the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.102

Where:

Me = the vehicle's effective mass.
v = average vehicle speed at the start or end of each speed range, 
as described in paragraph (h)(3) of this section.
t = timestamp at which the vehicle reaches the starting or ending 
speed expressed to at least one decimal place.
M = the vehicle's measured mass.
ag = acceleration of Earth's gravity, as described in 40 
CFR 1065.630.
h = average elevation at the start or end of each speed range 
expressed to at least two decimal places.
D = distance traveled on the road surface from a fixed reference 
location along the road to the start or end of each speed range 
expressed to at least one decimal place.

    Example: 
Me = 17,129 kg (18 tires in contact with the road 
surface)
vstart = 69.97 mi/hr = 31.28 m/s
vend = 59.88 mi/hr = 26.77 m/s
tstart = 3.05 s
tend = 19.11 s
M = 16,108 kg
ag = 9.8061 m/s\2\
hstart = 0.044 m
hend = 0.547 m
Dstart = 706.8 ft = 215.4 m
Dend = 2230.2 ft = 697.8 m
[GRAPHIC] [TIFF OMITTED] TR25OC16.103

F = 4645.5 N

    (5) For tractor testing, calculate the drive-axle spin loss force 
at high and low speeds, Fspin[speed], and determine 
[Delta]Fspin as follows:
    (i) Use the results from the axle efficiency test described in 
Sec.  1037.560 for the drive axle model installed in the tractor being 
tested for this coastdown procedure.
    (ii) Perform a second-order regression of axle power loss in W from 
only the zero-torque test points with wheel speed, fnwheel, 
in r/s from the axle efficiency test to determine coefficients 
c0, c1, and c2.
[GRAPHIC] [TIFF OMITTED] TR25OC16.104

    (iii) Calculate Fspin[speed] using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.105


[[Page 74086]]


Where:

vseg[speed] = the mean vehicle speed of all vehicle speed 
measurements in each low-speed and high-speed segment.
TRPM = tire revolutions per mile for the drive tire model installed 
on the tractor being tested according to Sec.  1037.520(c)(1).

    Example: 
vseghi = 28.86 m/s
vseglo = 5.84 m/s
TRPM = 508 r/mi = 0.315657 r/m
c0 = -206.841 W
c1 = 239.8279 W[middot]s/r
c2 = 21.27505 W[middot]s\2\/r\2\
[GRAPHIC] [TIFF OMITTED] TR25OC16.106

Fspinhi = 129.7 N
Fspinlo = 52.7 N

    (iv) Calculate [Delta]Fspin using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.107

    Example: 
[Delta]Fspin = 129.7-52.7 = 77.0 N

    (6) For tractor testing, calculate the tire rolling resistance 
force at high and low speeds for steer, drive, and trailer axle 
positions, FTRR[speed,axle], and determine 
[Delta]FTRR as follows:
    (i) Conduct a stepwise coastdown tire rolling resistance test with 
three tires for each tire model installed on the vehicle using SAE 
J2452 (incorporated by reference in Sec.  1037.810) for the following 
test points (which replace the test points in Table 3 of SAE J2452):

     Table 1 of Sec.   1037.528--Stepwise Coastdown Test Points for
       Determining Tire Rolling Resistance as a Function of Speed
------------------------------------------------------------------------
                                                             Inflation
                 Step #                     Load (% of    pressure (% of
                                               max)            max)
------------------------------------------------------------------------
1.......................................              20             100
2.......................................              55              70
3.......................................              85             120
4.......................................              85             100
5.......................................             100              95
------------------------------------------------------------------------

    (ii) Calculate FTRR[speed,axle] using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.108

Where:

nt,[axle] = number of tires at the axle position.
P[axle] = the inflation pressure set and measured on the 
tires at the axle position at the beginning of the coastdown test.
L[axle] = the load over the axle at the axle position on 
the coastdown test vehicle.
[alpha][axle], [beta][axle], 
a[axle], b[axle], and c[axle] = 
regression coefficients from SAE J2452 that are specific to axle 
position.

    Example: 
nt,steer = 2
Psteer = 758.4 kPa
Lsteer = 51421.2 N
[alpha]steer = -0.2435
[beta]steer = 0.9576
asteer = 0.0434
bsteer = 5.4[middot]10-\5\
csteer = 5.53[middot]10-\7\
nt,drive = 8
Pdrive = 689.5 kPa
Ldrive = 55958.4 N
[alpha]drive = -0.3146
[beta]drive = 0.9914
adrive = 0.0504
bdrive = 1.11[middot]10-\4\
cdrive = 2.86[middot]10-\7\
nt,trailer = 8
Ptrailer = 689.5 kPa
Ltrailer = 45727.5 N
[alpha]trailer = -0.3982
[beta]trailer = 0.9756
atrailer = 0.0656
btrailer = 1.51[middot]10-\4\
ctrailer = 2.94[middot]10-\7\
vseghi = 28.86 m/s = 103.896 km/hr
vseglo = 5.84 m/s = 21.024 km/hr

[[Page 74087]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.109

FTRRhi,steer = 365.6 N
FTRRhi,drive = 431.4 N
FTRRhi,trailer = 231.7 N
FTRRlo,steer = 297.8 N
FTRRlo,drive = 350.7 N
FTRRlo,trailer = 189.0 N

    (iii) Calculate FTRR[speed] by summing the tire rolling 
resistance calculations at a given speed for each axle position and 
determine [Delta]FTRR as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.110

    Example: 
FTRRhi = 365.6 + 431.4 + 231.7 = 1028.7 N
FTRRlo = 297.8 + 350.7 + 189.0 = 837.5 N

    (iv) Adjust FTRR[speed] to the ambient temperature 
during the coastdown segment as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.111

Where:

Tseg[speed] = the average ambient temperature during the 
low or high speed segments.

    Example: 
FTRRhi = 1028.7 N
FTRRlo = 837.5 N
Tseghi = 25.5 [deg]C
Tseglo = 25.1 [deg]C
FTRRhi,adj = 1028.7[middot][1 + 0.006[middot](24-25.5)] = 
1019.4 N
FTRRlo,adj = 837.5[middot][1 + 0.006[middot](24-25.1)] = 
832.0 N

    (v) Determine [Delta]FTRR as follows:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.112
    
    Example: 
[Delta]FTRR = 1019.4 - 832.0 = 187.4 N

    (7) For trailer testing, determine [Delta]FTRR using a 
default value adjusted to the ambient temperature instead of performing 
a rolling resistance test, as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.113

Where:

[Delta]FTRR,def = default rolling resistance force speed 
adjustment; Use 215 N for long box vans and 150 N for short box 
vans.
Tcoast = the average ambient temperature during both low 
and high speed segments.

    Example: 
[Delta]FTRR,def = 215 N
Tcoast = 25.5 [deg]C
[Delta]FTRR = 215[middot][1 + 0.0006[middot](24-25.5)] = 
213.1 N

    (8) Square the air speed measurements and calculate average squared 
air speed during each speed range for each 
run,v2air,hi and v2air,lo.
    (9) Average the Flo and v2air,lo 
values for each pair of runs in opposite directions. If running 
complete coastdowns as described in paragraph (d)(1) or one high-speed 
segment per direction as described in paragraph (d)(2), average every 
two Flo and v2air,lo values. If 
running two high-speed segments per direction as described in paragraph 
(d)(2), average every four Flo and 
v2air,lo values. Use these values as 
Flo,pair and v2air,lo,pair in the 
calculations in this paragraph (h) to apply to each of the two or four 
high-speed segments from the same runs as the low-speed segments used 
to determine Flo,pair and 
v2air,lo,pair.
    (10) Calculate average air temperature T and air pressure 
Pact during each high-speed run.
    (11) Calculate drag area, CdA, in m\2\ for each high-
speed segment using the following equation, expressed to at least three 
decimal places:

[[Page 74088]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.114

Where:

Fhi = road load force at high speed determined from Eq. 
1037.528-7.
Flo,pair = the average of Flo values for a 
pair of opposite direction runs calculated as described in paragraph 
(h)(9) of this section.
[Delta]Fspin = the difference in drive-axle spin loss 
force between high-speed and low-speed coastdown segments. This is 
described in paragraph (h)(5) of this section for tractor testing. 
Let [Delta]Fspin = 110 N for trailer testing.
[Delta]FTRR = the difference in tire rolling resistance 
force between high-speed and low-speed coastdown segments as 
described in paragraphs (h)(6) or (7) of this section.
v2air,lo,pair = the average of 
v2air,lo values for a pair of opposite 
direction runs calculated as described in paragraph (h)(9) of this 
section.
R = specific gas constant = 287.058 J/(kg[middot]K).
T = mean air temperature expressed to at least one decimal place.
Pact = mean absolute air pressure expressed to at least 
one decimal place.

    Example: 
Fhi = 4645.5 N
Flo,pair = 1005.0 N
[Delta]Fspin = 77.0 N
[Delta]FTRR = 187.4 N
v2air,hi = 933.4 m\2\/s\2\
v2air,lo,pair = 43.12 m\2\/s\2\
R = 287.058 J/(kg[middot]K)
T = 285.97 K
Pact = 101.727 kPa = 101727 Pa
[GRAPHIC] [TIFF OMITTED] TR25OC16.115

CdA = 6.120 m\2\

    (12) Calculate your final CdA value from the high-speed 
segments as follows:
    (i) Eliminate all points where there were known equipment problems 
or other measurement problems.
    (ii) Of the remaining points, calculate the median of the absolute 
value of the yaw angles, [psi]med, and eliminate all 
CdA values that differ by more than 1.0[deg] from 
[psi]med.
    (iii) Of the remaining points, calculate the mean and standard 
deviation of CdA and eliminate all values that differ by 
more than 2.0 standard deviations from the mean value.
    (iv) There must be at least 24 points remaining. Of the remaining 
points, recalculate the mean yaw angle. Round the mean yaw angle to the 
nearest 0.1[deg]. This final result is the effective yaw angle, 
[psi]eff, for coastdown testing.
    (v) For the same set of points, recalculate the mean 
CdA. This is the final result of the coastdown test, 
CdAeffective-yaw-coastdown.
    (i) [Reserved]
    (j) Include the following information in your application for 
certification:
    (1) The name, location, and description of your test facilities, 
including background/history, equipment and capability, and track and 
facility elevation, along with the grade and size/length of the track.
    (2) Test conditions for each test result, including date and time, 
wind speed and direction, ambient temperature and humidity, vehicle 
speed, driving distance, manufacturer name, test vehicle/model type, 
model year, applicable family, tire type and rolling resistance, weight 
of tractor-trailer (as tested), and driver identifier(s).
    (3) Average CdA and yaw angle results and all the 
individual run results (including voided or invalid runs).


Sec.  1037.530  Wind-tunnel procedures for calculating drag area (CdA).

    The wind-tunnel procedure specified in this section is considered 
to be the primary procedure for trailers, but is an alternate procedure 
for tractors.
    (a) You may measure drag areas consistent with published SAE 
procedures as described in this section using any wind tunnel 
recognized by the Subsonic Aerodynamic Testing Association, subject to 
the provisions of Sec. Sec.  1037.525 through 1037.527. If your wind 
tunnel does not meet the specifications described in this section, you 
may ask us to approve it as an alternate method under Sec.  1037.525(d) 
or Sec.  1037.526(d). All wind tunnels and wind tunnel tests must meet 
the specifications described in SAE J1252 (incorporated by reference in 
Sec.  1037.810), with the following exceptions and additional 
provisions:
    (1) The Overall Vehicle Reynolds number, 
Rew, must be at least 1.0[middot]10\6\. 
Tests for Reynolds effects described in Section 7.1 of SAE J1252 are 
not required.
    (2) For full-scale wind tunnel tractor testing, use good 
engineering judgment to select a trailer that is a reasonable 
representation of the trailer used for reference coastdown testing. For 
example, where your wind tunnel is not long enough to test the tractor 
with a standard 53 foot box van, it may be appropriate to use a shorter 
box van. In such a case, the correlation developed using the shorter 
trailer would only be valid for testing with the shorter trailer.
    (3) For reduced-scale wind tunnel testing, use a one-eighth or 
larger scale model of a tractor and trailer that is sufficient to 
simulate airflow through the radiator inlet grill and across an engine 
geometry that represents engines commonly used in your test vehicle.
    (b) Open-throat wind tunnels must also meet the specifications of 
SAE J2071 (incorporated by reference in Sec.  1037.810).
    (c) To determine CdA values for certifying tractors, 
perform wind-tunnel testing with a tractor-trailer combination using 
the manufacturer's tractor and a standard trailer. To determine 
CdA values for certifying trailers, perform wind-tunnel 
testing with a tractor-trailer combination using a standard tractor. 
Use a moving/rolling floor if the facility has one. For Phase 1 
tractors, conduct the wind tunnel tests at a zero yaw angle. For Phase 
2 vehicles, conduct the wind tunnel tests by measuring the drag area at 
yaw angles of +4.5[deg] and -4.5[deg] and calculating the average of 
those two values.
    (d) In your request to use wind-tunnel testing for tractors, or in 
your application for certification for trailers, describe how you meet 
all the specifications that apply under this section, using terminology 
consistent with SAE J1594 (incorporated by reference in Sec.  
1037.810). If you request our approval to use wind-tunnel testing even 
though you do not meet all the specifications of this section, describe 
how your method nevertheless qualifies

[[Page 74089]]

as an alternate method under Sec.  1037.525(d) or 1037.526(d) and 
include all the following information:
    (1) Identify the name and location of the test facility for your 
wind-tunnel method.
    (2) Background and history of the wind tunnel.
    (3) The wind tunnel's layout (with diagram), type, and construction 
(structural and material).
    (4) The wind tunnel's design details: The type and material for 
corner turning vanes, air settling specification, mesh screen 
specification, air straightening method, tunnel volume, surface area, 
average duct area, and circuit length.
    (5) Specifications related to the wind tunnel's flow quality: 
Temperature control and uniformity, airflow quality, minimum airflow 
velocity, flow uniformity, angularity and stability, static pressure 
variation, turbulence intensity, airflow acceleration and deceleration 
times, test duration flow quality, and overall airflow quality 
achievement.
    (6) Test/working section information: Test section type (e.g., 
open, closed, adaptive wall) and shape (e.g., circular, square, oval), 
length, contraction ratio, maximum air velocity, maximum dynamic 
pressure, nozzle width and height, plenum dimensions and net volume, 
maximum allowed model scale, maximum model height above road, strut 
movement rate (if applicable), model support, primary boundary layer 
slot, boundary layer elimination method, and photos and diagrams of the 
test section.
    (7) Fan section description: Fan type, diameter, power, maximum 
rotational speed, maximum speed, support type, mechanical drive, and 
sectional total weight.
    (8) Data acquisition and control (where applicable): Acquisition 
type, motor control, tunnel control, model balance, model pressure 
measurement, wheel drag balances, wing/body panel balances, and model 
exhaust simulation.
    (9) Moving ground plane or rolling road (if applicable): 
Construction and material, yaw table and range, moving ground length 
and width, belt type, maximum belt speed, belt suction mechanism, 
platen instrumentation, temperature control, and steering.
    (10) Facility correction factors and purpose.


Sec.  1037.532  Using computational fluid dynamics to calculate drag 
area (CdA).

    This section describes how to use commercially available 
computational fluid dynamics (CFD) software to determine CdA 
values, subject to the provisions of Sec. Sec.  1037.525 through 
1037.527. This is considered to be an alternate method for both 
tractors and trailers.
    (a) For Phase 2 vehicles, use SAE J2966 (incorporated by reference 
in Sec.  1037.810), with the following clarifications and exceptions:
    (1) Vehicles are subject to the requirement to meet standards based 
on the average of testing at yaw angles of +4.5[deg] or -4.5[deg]; 
however, you may submit your application for certification with CFD 
results based on only one of those yaw angles.
    (2) For CFD code with a Navier-Stokes based solver, follow the 
additional steps in paragraph (d) of this section. For Lattice-
Boltzmann based CFD code, follow the additional steps in paragraph (e) 
of this section.
    (3) Simulate a Reynolds number of 5.1 million and an air speed of 
65 mi/hr.
    (4) Perform the General On-Road Simulation (not the Wind Tunnel 
Simulation).
    (5) Use a free stream turbulence intensity of 0.0%.
    (6) Choose time steps that can accurately resolve intrinsic flow 
instabilities, consistent with good engineering judgment.
    (7) The result must be drag area (CdA), not drag 
coefficient (Cd), based on an air speed of 65 mi/hr.
    (8) Submit information as described in paragraph (g) of this 
section.
    (b) For Phase 1 tractors, apply the procedures as specified in 
paragraphs (c) through (f) of this section. Paragraphs (c) through (f) 
of section apply for Phase 2 vehicles only as specified in paragraph 
(a) of this section.
    (c) To determine CdA values for certifying a tractor, 
perform CFD modeling based on a tractor-trailer combination using the 
manufacturer's tractor and a standard trailer. To determine 
CdA values for certifying a trailer, perform CFD modeling 
based on a tractor-trailer combination using a standard tractor. 
Perform all CFD modeling as follows:
    (1) Specify a blockage ratio at or below 0.2% to simulate open-road 
conditions.
    (2) Assume zero yaw angle.
    (3) Model the tractor with an open grill and representative back 
pressures based on available data describing the tractor's pressure 
characteristics.
    (4) Enable the turbulence model and mesh deformation.
    (5) Model tires and ground plane in motion to simulate a vehicle 
moving forward in the direction of travel.
    (6) Apply the smallest cell size to local regions on the tractor 
and trailer in areas of high flow gradients and smaller-geometry 
features (e.g., the A-pillar, mirror, visor, grille and accessories, 
trailer-leading edge, trailer-trailing edge, rear bogey, tires, and 
tractor-trailer gap).
    (7) Simulate a vehicle speed of 55 mi/hr.
    (d) Take the following steps for CFD code with a Navier-Stokes 
formula solver:
    (1) Perform an unstructured, time-accurate analysis using a mesh 
grid size with a total volume element count of at least 50 million 
cells of hexahedral and/or polyhedral mesh cell shape, surface elements 
representing the geometry consisting of no less than 6 million 
elements, and a near-wall cell size corresponding to a y+ value of less 
than 300.
    (2) Perform the analysis with a turbulence model and mesh 
deformation enabled (if applicable) with boundary layer resolution of 
95%. Once the results reach this resolution, demonstrate 
the convergence by supplying multiple, successive convergence values 
for the analysis. The turbulence model may use k-epsilon (k-[egr]), 
shear stress transport k-omega (SST k-[omega]), or other commercially 
accepted methods.
    (e) For Lattice-Boltzmann based CFD code, perform an unstructured, 
time-accurate analysis using a mesh grid size with total surface 
elements of at least 50 million cells using cubic volume elements and 
triangular and/or quadrilateral surface elements with a near-wall cell 
size of no greater than 6 mm on local regions of the tractor and 
trailer in areas of high flow gradients and smaller geometry features, 
with cell sizes in other areas of the mesh grid starting at twelve 
millimeters and increasing in size from this value as the distance from 
the tractor and trailer increases.
    (f) You may ask us to allow you to perform CFD analysis using 
parameters and criteria other than those specified in this section, 
consistent with good engineering judgment. In your request, you must 
demonstrate that you are unable to perform modeling based on the 
specified conditions (for example, you may have insufficient computing 
power, or the computations may require inordinate time), or you must 
demonstrate that different criteria (such as a different mesh cell 
shape and size) will yield better results. In your request, you must 
also describe your recommended alternative parameters and criteria, and 
describe how this approach will produce results that adequately 
represent a vehicle's in-use performance. We may require that you 
supply data demonstrating that your selected parameters and criteria 
will

[[Page 74090]]

provide a sufficient level of detail to yield an accurate analysis. If 
you request an alternative approach because it will yield better 
results, we may require that you perform CFD analysis using both your 
recommended criteria and parameters and the criteria and parameters 
specified in this section to compare the resulting key aerodynamic 
characteristics, such as pressure profiles, drag build-up, and 
turbulent/laminar flow at key points around the tractor-trailer 
combination.
    (g) Include the following information in your request to determine 
CdA values using CFD:
    (1) The name of the software.
    (2) The date and version number of the software.
    (3) The name of the company producing the software and the 
corresponding address, phone number, and Web site.
    (4) Identify whether the software uses Navier-Stokes or Lattice-
Boltzmann equations.
    (5) Describe the input values you will use to simulate the 
vehicle's aerodynamic performance for comparing to coastdown results.


Sec.  1037.534  Constant-speed procedure for calculating drag area 
(CdA).

    This section describes how to use constant-speed aerodynamic drag 
testing to determine CdA values, subject to the provisions 
of Sec.  1037.525. This is considered to be an alternate method for 
tractors.
    (a) Test track. Select a test track that meets the specifications 
described in Sec.  1037.528(c)(3).
    (b) Ambient conditions. At least two tests are required. For one of 
the tests, ambient conditions must remain within the specifications 
described in Sec.  1037.528(c) throughout the preconditioning and 
measurement procedure. The other tests must also meet those 
specifications except for the wind conditions. The wind conditions must 
be such that 80 percent of the values of yaw angle, 
[psi]air, from the 50 mi/hr and 70 mi/hr test segments are 
between 4[deg] and 10[deg] or between -4[deg] and -10[deg].
    (c) Vehicle preparation. Perform testing with a tractor-trailer 
combination using the manufacturer's tractor and a standard trailer. 
Prepare tractors and trailers for testing as described in Sec.  
1037.528(b). Install measurement instruments meeting the requirements 
of 40 CFR part 1065, subpart C, that have been calibrated as described 
in 40 CFR part 1065, subpart D, as follows:
    (1) Measure torque at each of the drive wheels using a hub torque 
meter or a rim torque meter. If testing a tractor with two drive axles, 
you may disconnect one of the drive axles from receiving torque from 
the driveshaft, in which case you would measure torque at only the 
wheels that receive torque from the driveshaft. Set up instruments to 
read engine rpm for calculating rotational speed at the point of the 
torque measurements, or install instruments for measuring the 
rotational speed of the wheels directly.
    (2) Install instrumentation to measure vehicle speed at 10 Hz, with 
an accuracy and resolution of 0.1 mi/hr. Also install instrumentation 
for reading engine rpm from the engine's onboard computer.
    (3) Mount an anemometer on the trailer as described in Sec.  
1037.528(f).
    (4) Fill the vehicle's fuel tanks so they are at maximum capacity 
at the start of the measurement procedure.
    (5) Measure the weight over each axle to the nearest 20 kg, with a 
full fuel tank, including the driver and any passengers that will be in 
the vehicle during the test.
    (d) Measurement procedure. The measurement sequence consists of 
vehicle preconditioning followed by stabilization and measurement over 
five consecutive constant-speed test segments with three different 
speed setpoints (10, 50, and 70 mi/hr). Each test segment is divided 
into smaller increments for data analysis.
    (1) Precondition the vehicle and zero the torque meters as follows:
    (i) If you are using rim torque meters, zero the torque meters by 
lifting each instrumented axle and recording torque signals for at 
least 30 seconds, and then drive the vehicle at 50 mi/hr for at least 
30 minutes.
    (ii) If you are using any other kind of torque meter, drive the 
vehicle at 50 mi/hr for at least 30 minutes, and then allow the vehicle 
to coast down from full speed to a complete standstill while the clutch 
is disengaged or the transmission is in neutral, without braking. Zero 
the torque meters within 60 seconds after the vehicle stops moving by 
recording the torque signals for at least 30 seconds, and directly 
resume vehicle preconditioning at 50 mi/hr for at least 1.25 mi.
    (iii) You may calibrate instruments during the preconditioning 
drive.
    (2) Perform testing as described in paragraph (d)(3) of this 
section over a sequence of test segments at constant vehicle speed as 
follows:
    (i) 30030 seconds in each direction at 10 mi/hr.
    (ii) 45030 seconds in each direction at 70 mi/hr.
    (iii) 45030 seconds in each direction at 50 mi/hr.
    (iv) 45030 seconds in each direction at 70 mi/hr.
    (v) 45030 seconds in each direction at 50 mi/hr.
    (vi) 30030 seconds in each direction at 10 mi/hr.
    (3) When the vehicle preconditioning described in paragraph (d)(1) 
of this section is complete, stabilize the vehicle at the specified 
speed for at least 200 meters and start taking measurements. The test 
segment starts when you start taking measurements for all parameters.
    (4) During the test segment, continue to operate the vehicle at the 
speed setpoint, maintaining constant speed and torque within the ranges 
specified in paragraph (e) of this section. Drive the vehicle straight 
with minimal steering; do not change gears. Perform measurements as 
follows during the test segment:
    (i) Measure the rotational speed of the driveshaft, axle, or wheel 
where the torque is measured, or calculate it from engine rpm in 
conjunction with gear and axle ratios, as applicable.
    (ii) Measure vehicle speed in conjunction with time-of-day data.
    (iii) Measure ambient conditions, air speed, and air direction as 
described in Sec.  1037.528(e) and (f). Correct air speed and air 
direction as described in paragraphs (f)(1) and (2) of this section.
    (5) You may divide a test segment into multiple passes by 
suspending and resuming measurements. Stabilize vehicle speed before 
resuming measurements for each pass as described in paragraph (d)(3) of 
this section. Analyze the data from multiple passes by combining them 
into a single sequence of measurements for each test segment.
    (6) Divide measured values into even 10 second increments. If the 
last increment for each test segment is less than 10 seconds, disregard 
measured values from that increment for all calculations under this 
section.
    (e) Validation criteria. Analyze measurements to confirm that the 
test is valid. Analyze vehicle speed and drive torque by calculating 
the mean speed and torque values for each successive 1 second 
increment, for each successive 10 second increment, and for each test 
segment. The test is valid if the data conform to all the following 
specifications:
    (1) Vehicle speed. The mean vehicle speed for the test segment must 
be within 1.00 mi/hr of the speed setpoint. In addition, for testing at 
50 mi/hr and 70 mi/hr, all ten of the 1 second mean vehicle speeds used 
to calculate a corresponding 10 second mean vehicle speed must be 
within 0.2 mi/hr of that 10 second mean vehicle speed. 
Perform

[[Page 74091]]

the same data analysis for testing at 10 mi/hr, but apply a validation 
threshold of 0.1 mi/hr.
    (2) Drive torque. All ten of the 1 second mean torque values used 
to calculate a corresponding 10 second mean torque value must be within 
50% of that 10 second mean torque value.
    (3) Torque drift. Torque meter drift may not exceed 1%. 
Determine torque meter drift by repeating the procedure described in 
paragraph (d)(1) of this section after testing is complete, except that 
driving the vehicle is necessary only to get the vehicle up to 50 mi/hr 
as part of coasting to standstill.
    (f) Calculations. Analyze measured data for each time segment after 
time-aligning all the data. Use the following calculations to determine 
CdA:
    (1) Onboard air speed. Correct onboard anemometer measurements for 
air speed using onboard measurements and measured ambient conditions as 
described in Sec.  1037.528(f), except that you must first divide the 
test segment into consecutive 10 second increments. Disregard data from 
the final increment of the test segment if it is less than 10 seconds. 
This analysis results in the following equation for correcting air 
speed measurements:
[GRAPHIC] [TIFF OMITTED] TR25OC16.116

    (2) Yaw angle. Correct the onboard anemometer measurements for air 
direction for each test segment as follows:
    (i) Calculate arithmetic mean values for vehicle speed, v, wind 
speed, w, and wind direction, [phiv]w, over each 10 second 
increment for each test segment. Disregard data from the final 
increment of the test segment if it is less than 10 seconds.
    (ii) Calculate the theoretical air direction, 
[psi]air,th, for each 10 second increment using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.117

Where:

[phiv]veh = the vehicle direction, as described in Sec.  
1037.528(f)(2).

    Example: 
w = 7.1 mi/hr
v = 69.9 mi/hr
[phiv]w = 47.0[deg]
[phiv]veh = 0[deg]
[GRAPHIC] [TIFF OMITTED] TR25OC16.118

[psi]air,th = 3.97[deg]

    (iii) Perform a linear regression using paired values of 
[psi]air,th and measured air direction, 
[psi]air,meas, from each 10 second increment for all 50 mi/
hr and 70 mi/hr test segments to determine the air-direction correction 
coefficients, [beta]0 and [beta]1, based on the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.119

    (iv) For all 50 mi/hr and 70 mi/hr test segments, correct each 
measured value of air direction using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.120

    (3) Road load force. (i) Average the sum of the corrected torques, 
the average of the wheel speed measurements, and the vehicle speed over 
every 10 second increment to determine, Ttotal, 
fnwheel, and v.
    (ii) Calculate a mean road load force, FRL[speed], for 
each 10 second increment using the following equation:

[[Page 74092]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.121

Where:

Ttotal = mean of all corrected torques at a point in 
time.
v = mean vehicle speed.
fnwheel = mean wheel speed.
M = the measured vehicle mass.
ag = acceleration of Earth's gravity, as described in 40 
CFR 1065.630.
hinc = elevation at the start or end of each 10 second 
increment expressed to at least two decimal places.
Dinc = distance traveled on the road surface from a fixed 
reference location along the road to the start or end of each 10 
second increment, expressed to at least one decimal place.

    Example: 
Ttotal = 2264.9 N[middot]m
v = 31.6 m/s
fnwheel =598.0 r/min
M = 16508 kg
ag = 9.8061 m/s\2\
hinc,start = 0.044 m
hinc,end = 0.574 m
Dinc,start = 215.4 m
Dinc,end = 697.8 m
[GRAPHIC] [TIFF OMITTED] TR25OC16.122

FRL70 = 4310.6 N

    (4) Determination of drag area. Calculate a vehicle's drag area as 
follows:
    (i) Calculate the mean road load force from all 10 second 
increments from the 10 mi/hr test segments from the test that was 
within the wind limits specified in Sec.  1037.528(c), 
FRL10,test. This value represents the mechanical drag force 
acting on the vehicle.
    (ii) Calculate the mean aerodynamic force for each 10 second 
increment, Faero[speed], from the 50 mi/hr and 70 mi/hr test 
segments by subtracting FRL10,test from 
FRL[speed].
    (iii) Average the corrected air speed and corrected yaw angle over 
every 10 second segment from the 50 mi/hr and 70 mi/hr test segments to 
determine vair and [psi]air.
    (iv) Calculate CdA for each 10 second increment from the 
50 mi/hr and 70 mi/hr test segments using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.123

Where:

CdAi[speed] = the mean drag area for each 10 
second increment, i.
Faero[speed] = mean aerodynamic force over a given 10 
second increment = FRL[speed] - FRL10,test.
vair[speed] = mean aerodynamic force over a given 10 
second increment.
R = specific gas constant = 287.058 J/(kg[middot]K).
T = mean air temperature.
Pact = mean absolute air pressure.

    Example: 
FRL70 = 4310.6 N
FRL10,test = 900.1 N
Faero70 = 4310.6 - 900.1 = 3410.5 N
v2air70 = 1089.5 m\2\/s\2\
R = 287.058 J/(kg[middot]K)
T = 293.68 K
Pact = 101300 Pa
[GRAPHIC] [TIFF OMITTED] TR25OC16.124

CdAi70 = 5.210 m\2\

    (v) Plot all CdA values from the 50 mi/hr and 70 mi/hr 
test segments against the corresponding values for corrected yaw angle 
for each 10 second increment. Create a regression based on a fourth-
order polynomial regression equation of the following form:
[GRAPHIC] [TIFF OMITTED] TR25OC16.125


[[Page 74093]]


    (vi) Determine CdAwa-alt as the average of 
CdA values at 4.5[deg] and -4.5[deg] by applying Eq. 
1037.534-7 at those angles.
    (g) Documentation. Keep the following records related to the 
constant-speed procedure for calculating drag area:
    (1) The measurement data for calculating CdA as 
described in this section.
    (2) A general description and pictures of the vehicle tested.
    (3) The vehicle's maximum height and width.
    (4) The measured vehicle mass.
    (5) Mileage at the start of the first test segment and at the end 
of the last test segment.
    (6) The date of the test, the starting time for the first test 
segment, and the ending time for the last test segment.
    (7) The transmission gear used for each test segment.
    (8) The data describing how the test was valid relative to the 
specifications and criteria described in paragraphs (b) and (e) of this 
section.
    (9) A description of any unusual events, such as a vehicle passing 
the test vehicle, or any technical or human errors that may have 
affected the CdA determination without invalidating the 
test.


Sec.  1037.540  Special procedures for testing vehicles with hybrid 
power take-off.

    This section describes optional procedures for quantifying the 
reduction in greenhouse gas emissions for vehicles as a result of 
running power take-off (PTO) devices with a hybrid energy delivery 
system. See Sec.  1037.550 for powertrain testing requirements that 
apply for drivetrain hybrid systems. The procedures are written to test 
the PTO by ensuring that the engine produces all of the energy with no 
net change in stored energy (charge-sustaining), and for plug-in hybrid 
vehicles, also allowing for drawing down the stored energy (charge-
depleting). The full charge-sustaining test for the hybrid vehicle is 
from a fully charged renewable energy storage system (RESS) to a 
depleted RESS and then back to a fully charged RESS. You must include 
all hardware for the PTO system. You may ask us to modify the 
provisions of this section to allow testing hybrid vehicles other than 
electric-battery hybrids, consistent with good engineering judgment. 
For plug-in hybrids, use a utility factor to properly weight charge-
sustaining and charge-depleting operation as described in paragraph 
(f)(3) of this section.
    (a) Select two vehicles for testing as follows:
    (1) Select a vehicle with a hybrid energy delivery system to 
represent the range of PTO configurations that will be covered by the 
test data. If your test data will represent more than one PTO 
configuration, use good engineering judgment to select the 
configuration with the maximum number of PTO circuits that has the 
smallest potential reduction in greenhouse gas emissions.
    (2) Select an equivalent conventional vehicle as specified in Sec.  
1037.615.
    (b) Measure PTO emissions from the fully warmed-up conventional 
vehicle as follows:
    (1) Without adding a restriction, instrument the vehicle with 
pressure transducers at the outlet of the hydraulic pump for each 
circuit. Perform pressure measurements with a frequency of at least 1 
Hz.
    (2) Operate the PTO system with no load for at least 15 seconds. 
Measure gauge pressure and record the average value over the last 10 
seconds (pmin). For hybrid PTO systems the measured pressure 
with no load is typically zero. Apply maximum operator demand to the 
PTO system until the pressure relief valve opens and pressure 
stabilizes; measure gauge pressure and record the average value over 
the last 10 seconds (pmax).
    (3) Denormalize the PTO duty cycle in Appendix II of this part 
using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.126

Where:

prefi = the reference pressure at each point i in the PTO 
cycle.
pi = the normalized pressure at each point i in the PTO 
cycle (relative to pmax).
pmax = the mean maximum pressure measured in paragraph 
(b)(2) of this section.
pmin = the mean minimum pressure measured in paragraph 
(b)(2) of this section.

    (4) If the PTO system has two circuits, repeat paragraph (b)(2) and 
(3) of this section for the second PTO circuit.
    (5) Install a system to control pressures in the PTO system during 
the cycle.
    (6) Start the engine.
    (7) Depending on the number of circuits the PTO system has, operate 
the vehicle over one or concurrently over both of the denormalized PTO 
duty cycles in Appendix II of this part. Measure emissions during 
operation over each duty cycle using the provisions of 40 CFR part 
1066.
    (8) Measured pressures must meet the cycle-validation 
specifications in the following table for each test run over the duty 
cycle:

  Table 1 of Sec.   1037.540--Statistical Criteria for Validating Each
                      Test Run Over the Duty Cycle
------------------------------------------------------------------------
               Parameter \1\                          Pressure
------------------------------------------------------------------------
Slope, a1.................................  0.950 <= a1 <= 1.030.
Absolute value of intercept,                <= 2.0% of maximum mapped
 [verbar]a0[verbar].                         pressure.
Standard error of estimate, SEE...........  <= 10% of maximum mapped
                                             pressure.
Coefficient of determination, r\2\........  >= 0.970.
------------------------------------------------------------------------
\1\ Determine values for specified parameters as described in 40 CFR
  1065.514(e) by comparing measured values to denormalized pressure
  values from the duty cycle in Appendix II of this part.

    (c) Measure PTO emissions from the fully warmed-up hybrid vehicle 
as follows:
    (1) Perform the steps in paragraphs (b)(1) through (5) of this 
section.
    (2) Prepare the vehicle for testing by operating it as needed to 
stabilize the RESS at a full state of charge (or equivalent for non-
electric RESS).
    (i) For plug-in hybrid electric vehicles, we recommend charging the 
battery with an external electrical source.
    (ii) For other vehicles, we recommend running back-to-back PTO 
tests until engine operation is initiated to charge the RESS. The RESS 
should be fully charged once engine operation stops. The ignition 
should remain in the ``on'' position.
    (3) Turn the vehicle and PTO system off while the sampling system 
is being prepared.
    (4) Turn the vehicle and PTO system on such that the PTO system is

[[Page 74094]]

functional, whether it draws power from the engine or a battery.
    (5) Operate the vehicle over one or both of the denormalized PTO 
duty cycles without turning the vehicle off, until the engine starts 
and then shuts down. This may require running multiple repeats of the 
PTO duty cycles. For non-PHEV systems the test cycle is completed once 
the engine shuts down. For plug-in hybrid systems, continue running 
until the PTO hybrid is running in a charge-sustaining mode such that 
the ``End of Test'' requirements defined in 40 CFR 1066.501 are met. 
Measure emissions as described in paragraph (b)(7) of this section. Use 
good engineering judgment to minimize the variability in testing 
between the two types of vehicles.
    (6) For plug-in hybrid electric vehicles, follow 40 CFR 1066.501 to 
divide the test into charge-depleting and charge-sustaining operation.
    (7) Apply cycle-validation criteria as described in paragraph 
(b)(8) of this section to both charge-sustaining and charge-depleting 
operation.
    (d) Calculate the equivalent distance driven based on operating 
time for each section of the PTO portion of the test as applicable by 
determining the time of the test and applying the conversion factor in 
paragraph (d)(4) of this section. For testing where fractions of a 
cycle were run (for example, where three cycles are completed and the 
halfway point of a fourth PTO cycle is reached before the engine starts 
and shuts down again), calculate the time of the test, 
ttest, as follows:
    (1) Add up the time run for all complete tests.
    (2) For fractions of a test, use the following equation to 
calculate the time:
[GRAPHIC] [TIFF OMITTED] TR25OC16.127

Where:

i = an indexing variable that represents one recorded value.
N = number of measurement intervals.
pcircuit-1,i = normalized pressure command from circuit 1 
of the PTO cycle for each point, i, starting from i = 1.
pcircuit-2,i = normalized pressure command from circuit 2 
of the PTO cycle for each point, i, starting from i = 1. Let 
pcircuit-2 = 0 if there is only one circuit.
pcircuit-1 = the mean normalized pressure command from 
circuit 1 over the entire PTO cycle.
pcircuit-2 = the mean normalized pressure command from 
circuit 2 over the entire PTO cycle. Let pcircuit-2 = 0 
if there is only one circuit.
[Delta]t = the time interval between measurements. For example, at 
100 Hz, [Delta]t = 0.0100 seconds.

    (3) Sum the time from the complete cycles and from the partial 
cycle.
    (4) Divide the total PTO operating time from paragraph (d)(3) of 
this section by a conversion factor of 0.0144 hr/mi for Phase 1 and 
0.0217 hr/mi for Phase 2 to determine the equivalent distance driven. 
The conversion factors are based on estimates of average vehicle speed 
and PTO operating time as a percentage of total engine operating time; 
the Phase 2 conversion factor is calculated from an average speed of 
27.1 mi/hr and PTO operation 37% of engine operating time, as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.128

    (e) For Phase 1, calculate combined cycle-weighted emissions of the 
four duty cycles for vocational vehicles, for both the conventional and 
hybrid PTO vehicle tests, as follows:
    (1) Calculate the CO2 emission rates in grams per test 
without rounding for both the conventional vehicle and the charge-
sustaining and charge-depleting portions of the test for the hybrid 
vehicle as applicable.
    (2) Divide the CO2 mass from the PTO cycle by the 
distance determined in paragraph (d)(4) of this section and the 
standard payload to get the CO2 emission rate in g/ton-mile. 
For plug-in hybrid electric vehicles follow paragraph (f)(3) of this 
section to calculate utility factor weighted CO2 emissions 
in g/ton-mile.
    (3) Calculate the g/ton-mile emission rate for the driving portion 
of the test specified in Sec.  1037.510 and add this to the 
CO2 g/ton-mile emission rate for the PTO portion of the 
test.
    (4) Follow the provisions of Sec.  1037.615 to calculate 
improvement factors and benefits for advanced technologies.
    (f) For Phase 2, calculate the delta PTO fuel results for input 
into GEM during vehicle certification as follows:
    (1) Calculate fuel consumption in grams per test, 
mfuelPTO, without rounding, as described in 40 CFR 
1036.540(d)(4) and (5) for both the conventional vehicle and the 
charge-sustaining and charge-depleting portions of the test for the 
hybrid vehicle as applicable.
    (2) Divide the fuel mass by the applicable distance determined in 
paragraph (d)(4) of this section and the appropriate standard payload 
to determine the fuel rate in g/ton-mile.
    (3) For plug-in hybrid electric vehicles calculate the utility 
factor weighted fuel consumption in g/ton-mile, as follows:
    (i) Determine the utility factor fraction for the PTO system from 
the table in Appendix V of this part using interpolation based on the 
total time of the charge-depleting portion of the test as determined in 
paragraphs (c)(6) and (d)(3) of this section.
    (ii) Weight the emissions from the charge-sustaining and charge-
depleting portions of the test using the following equation:

[[Page 74095]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.129

Where:

mPTO,CD = mass of fuel per ton-mile while in charge-
depleting mode.
UFtCD = utility factor fraction at time tCD as 
determined in paragraph (f)(3)(i) of this section.
mPTO,CS = mass of fuel per ton-mile while in charge-
sustaining mode.

    (4) Calculate the difference between the conventional PTO emissions 
result and the hybrid PTO emissions result for input into GEM.
    (g) If the PTO system has more than two circuits, apply the 
provisions of this section using good engineering judgment.


Sec.  1037.550  Powertrain testing.

    (a) This section describes how to determine engine fuel maps using 
a measurement procedure that involves testing an engine coupled with a 
powertrain to simulate vehicle operation. Engine fuel maps are part of 
demonstrating compliance with Phase 2 vehicle standards under this part 
1037; this fuel-mapping information may come from different types of 
testing as described in 40 CFR 1036.510.
    (b) Perform powertrain testing to establish measured fuel-
consumption rates over applicable duty cycles for several different 
vehicle configurations. The following general provisions apply:
    (1) Measure NOX emissions for each sampling period in 
grams. You may perform these measurements using a NOX 
emission-measurement system that meets the requirements of 40 CFR part 
1065, subpart J. Include these measured NOX values any time 
you report to us your greenhouse gas emissions or fuel consumption 
values from testing under this section. If a system malfunction 
prevents you from measuring NOX emissions during a test 
under this section but the test otherwise gives valid results, you may 
consider this a valid test and omit the NOX emission 
measurements; however, we may require you to repeat the test if we 
determine that you inappropriately voided the test with respect to 
NOX emission measurement.
    (2) This section uses engine parameters and variables that are 
consistent with 40 CFR part 1065.
    (3) While this section includes the detailed equations, you need to 
develop your own driver model and vehicle model; we recommend that you 
use the MATLAB/Simulink code provided at www.epa.gov/otaq/climate/gem.htm.
    (c) Select an engine and powertrain for testing as described in 
Sec.  1037.231.
    (d) Set up the engine according to 40 CFR 1065.110. The default 
test configuration involves connecting the powertrain's transmission 
output shaft directly to the dynamometer. You may instead set up the 
dynamometer to connect at the wheel hubs if your powertrain 
configuration requires it, such as for hybrid powertrains, or if you 
want to represent the axle performance with powertrain test results. If 
you connect at the wheel hubs, input your test results into GEM to 
reflect this.
    (e) Cool the powertrain during testing so temperatures for intake-
air, oil, coolant, block, head, transmission, battery, and power 
electronics are within their expected ranges for normal operation. You 
may use auxiliary coolers and fans.
    (f) Set the dynamometer to operate in speed-control mode. Record 
data as described in 40 CFR 1065.202. Command and control dynamometer 
speed at a minimum of 5 Hz. If you choose to command the dynamometer at 
a slower rate than the calculated dynamometer speed setpoint, use good 
engineering judgment to subsample the calculated setpoints for use in 
commanding the dynamomemter speed setpoint. Design a vehicle model to 
use the measured torque and calculate the dynamometer speed setpoint at 
a rate of at least 100 Hz, as follows:
    (1) Calculate the dynamometer's angular speed target, 
[fnof]nref,dyno, based on the simulated linear speed of the 
tires:
[GRAPHIC] [TIFF OMITTED] TR25OC16.130

Where:

ka[speed] = drive axle ratio as determined in paragraph 
(h) of this section.
vrefi = simulated vehicle reference speed. Use the 
unrounded result for calculating [fnof]nrefi,dyno.
r[speed] = tire radius as determined in paragraph (h) of 
this section.
[GRAPHIC] [TIFF OMITTED] TR25OC16.131

Where:

i = a time-based counter corresponding to each measurement during 
the sampling period. Let vref1 = 0; start calculations at 
i = 2. A 10-minute sampling period will generally involve 60,000 
measurements.
T = instantaneous measured torque.

[[Page 74096]]

E[fnof][fnof]axle = axle efficiency. Use 
E[fnof][fnof]axle = 0.955 for T > 0, and use 
E[fnof][fnof]axle = 1/0.955 for T < 0. To calculate 
[fnof]nrefi,dyno for a dynamometer connected at the wheel 
hubs, as described in paragraph (f)(2) of this section, use 
E[fnof][fnof]axle = 1.0.
M = vehicle mass for a vehicle class as determined in paragraph (h) 
of this section.
g = gravitational constant = 9.81 m/s\2\.
Crr = coefficient of rolling resistance for a vehicle 
class as determined in paragraph (h) of this section.
Gi-1 = the percent grade interpolated at distance, 
Di-1, from the duty cycle in Appendix IV corresponding to 
measurement (i-1).
[GRAPHIC] [TIFF OMITTED] TR25OC16.132

[rho] = air density at reference conditions. Use [rho] = 1.20 kg/
m\3\.
CdA = drag area for a vehicle class as determined in 
paragraph (h) of this section.
Fbrake = instantaneous braking force applied by the 
driver model.
[GRAPHIC] [TIFF OMITTED] TR25OC16.310

[Delta]t = the time interval between measurements. For example, at 
100 Hz, [Delta]t = 0.0100 seconds.
Mrotating = inertial mass of rotating components. Let 
Mrotating = 340 kg for vocational Light HDV or vocational 
Medium HDV. See paragraph (h) of this section for tractors and for 
vocational Heavy HDV.

    Example: 
    This example is for a vocational Light HDV or vocational Medium 
HDV with 6 speed automatic transmission at B speed (Test 4 in Table 
2 of 40 CFR 1036.540).
kaB = 4.0
rB = 0.399 m
T1000-1 = 500.0 N[middot]m
Crr = 6.9 kg/tonne = 6.9[middot]10\-3\ kg/kg
M = 11408 kg
CdA = 5.4 m\2\
G1000-1 = 1.0% = 0.018
[GRAPHIC] [TIFF OMITTED] TR25OC16.133

Fbrake1000-1 = 0 N
vref1000-1 = 20.0 m/s
Fgrade1001-1 = 11408[middot]9.81[middot]sin(atan(0.018)) = 
2014.1N
[Delta]t = 0.0100 s
Mrotating = 340 kg
[GRAPHIC] [TIFF OMITTED] TR25OC16.134

vref1000 = 20.00129 m/s
[GRAPHIC] [TIFF OMITTED] TR25OC16.311

    (2) For testing with the dynamometer connected at the wheel hubs, 
calculate fnref,dyno using the following equation:

[[Page 74097]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.312

    (g) Design a driver model to simulate a human driver modulating the 
throttle and brake pedals to follow the test cycle as closely as 
possible. The driver model must meet the speed requirements for 
operation over the highway cruise cycles as described in Sec.  1037.510 
and for operation over the transient cycle as described in 40 CFR 
1066.425(b). The exceptions in 40 CFR 1066.425(b)(4) apply to the 
transient cycle and the highway cruise cycles. Design the driver model 
to meet the following specifications:
    (1) Send a brake signal when throttle position is zero and vehicle 
speed is greater than the reference vehicle speed from the test cycle. 
Include a delay before changing the brake signal to prevent dithering, 
consistent with good engineering judgment.
    (2) Allow braking only if throttle position is zero.
    (3) Compensate for the distance driven over the duty cycle over the 
course of the test. Use the following equation to perform the 
compensation in real time to determine your time in the cycle:
[GRAPHIC] [TIFF OMITTED] TR25OC16.135

Where:

vvehicle = measured vehicle speed.
vcycle = reference speed from the test cycle. If 
vcycle,i-1 < 1.0 m/s, set vcycle,i-1 = 
vvehicle,i-1.

    (h) Configure the vehicle model in the test cell to test the 
powertrain using at least three equally spaced axle ratios or tire 
sizes and three different road loads (nine configurations), or at least 
four equally spaced axle ratios or tire sizes and two different road 
loads (eight configurations) to cover the range of intended vehicle 
applications. Select axle ratios to represent the full range of 
expected vehicle installations. Determine the vehicle model inputs for 
vehicle mass, CdA, and Crr for a set of vehicle 
configurations as described in 40 CFR 1036.540(c)(3). You may instead 
test to simulate eight or nine vehicle configurations from different 
vehicle categories if you limit your powertrains to a certain range of 
vehicles. For example, if your powertrain will be installed only in 
vocational Medium HDV and vocational Heavy HDV, you may perform testing 
to represent eight or nine vehicle configurations using vehicle masses 
for Medium HDV and Heavy HDV, the predefined CdA for those 
vehicles, and the lowest and highest Crr of the tires that 
will be installed on those vehicles. Also, instead of selecting 
specific axle ratios and tire size as described in this paragraph (h), 
you may select equally spaced axle ratios and tire sizes that cover the 
range of minimum and maximum engine speed over vehicle speed when the 
transmission is in top gear for the vehicles the powertrain will be 
installed in.
    (i) Operate the powertrain over each of the duty cycles specified 
in Sec.  1037.510(a)(2), and for each applicable test configuration 
identified in 40 CFR 1036.540(c). For each duty cycle, precondition the 
powertrain using the Test 1 vehicle configuration and test the 
different configurations in numerical order starting with Test 1. If an 
infrequent regeneration event occurs during testing, void the test, but 
continue operating the vehicle to allow the regeneration event to 
finish, then precondition the engine to the same condition as would 
apply for normal testing and restart testing at the start of the same 
duty cycle for that test configuration. For PHEV powertrains, 
precondition the battery and then complete all back to back tests for 
each test configuration according to 40 CFR 1066.501 before moving to 
the next test configuration. You may send signals to the engine 
controller during the test, such as cycle road grade and vehicle speed, 
if that allows powertrain operation during the test to better represent 
real-world operation.
    (j) Collect and measure emissions as described in 40 CFR part 1065. 
For hybrid powertrains with no plug-in capability, correct for the net 
energy change of the energy storage device as described in 40 CFR 
1066.501. For PHEV powertrains, follow 40 CFR 1066.501 to determine 
End-of-Test for charge-depleting operation. You must get our approval 
in advance for your utility factor curve; we will approve it if you can 
show that you created it from sufficient in-use data of vehicles in the 
same application as the vehicles in which the PHEV powertrain will be 
installed.
    (k) For each test point, validate the measured output speed with 
the corresponding reference values. If the range of reference speed is 
less than 10 percent of the mean reference speed, you need to meet only 
the standard error of estimate in Table 1 of this section. You may 
delete points when the vehicle is stopped. Apply cycle-validation 
criteria for each separate transient or highway cruise cycle based on 
the following parameters:

  Table 1 of Sec.   1037.550--Statistical Criteria for Validating Duty
                                 Cycles
------------------------------------------------------------------------
               Parameter\1\                         Speed control
------------------------------------------------------------------------
Slope, a1.................................  0.990 <=a1<=1.010.
Absolute value of intercept,                <=2.0% of maximum test
 a0.                       speed.
Standard error of estimate, SEE...........  <=2.0% of maximum test
                                             speed.
Coefficient of determination, r\2\........  >=0.990.
------------------------------------------------------------------------
\1\ Determine values for specified parameters as described in 40 CFR
  1065.514(e) by comparing measured and reference values for fnref,dyno.

    (l) [Reserved]
    (m) Calculate mass of fuel consumed for all duty cycles except idle 
as described in 40 CFR 1036.540(d)(4).

[[Page 74098]]

    (n) Determine the mass of fuel consumed at idle for the applicable 
duty cycles as follows:
    (1) Measure fuel consumption with a fuel flow meter and report the 
mean fuel mass flow rate for each duty cycle as applicable, 
mifuelidle.
    (2) For measurements that do not involve measured fuel mass flow 
rate, calculate the fuel mass flow rate for each duty cycle, 
mifuelidle, for each set of vehicle settings, as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.136

Where:

MC = molar mass of carbon.
wCmeas = carbon mass fraction of fuel (or mixture of test 
fuels) as determined by in CFR 1065.655(d), except that you may not 
use the default properties in Table 1 of 40 CFR 1065.655 to 
determine [alpha], [beta], and wC for liquid fuels.
niexh = the mean raw exhaust molar flow rate from which 
you measured emissions according to 40 CFR 1065.655.
xCcombdry = the mean concentration of carbon from fuel 
and any injected fluids in the exhaust per mole of dry exhaust.
xH2Oexhdry = the mean concentration of H2O in 
exhaust per mole of dry exhaust.
miH2O2DEF= the mean CO2 mass emission rate 
resulting from diesel exhaust fluid decomposition over the duty 
cycle as determined in 40 CFR 1036.535(b)(10). If your engine does 
not use diesel exhaust fluid, or if you choose not to perform this 
correction, set miCO2DEF equal to 0.
MCO2 = molar mass of carbon dioxide.

    Example: 
MC = 12.0107 g/mol
wCmeas = 0.867
niexh = 25.534 mol/s
xCcombdry = 2.805[middot]10-\3\ mol/mol
xH2Oexhdry = 3.53[middot]10-\2\ mol/mol
miCO2DEF = 0.0726 g/s
MCO2 = 44.0095
[GRAPHIC] [TIFF OMITTED] TR25OC16.137

mifuelidle = 0.405 g/s = 1458.6 g/hr

    (o) Use the results of powertrain testing to determine GEM inputs 
for the different simulated vehicle configurations as follows:
    (1) Select fuel-consumption rates, mfuel[cycle], in g/
cycle. In addition, declare a fuel mass consumption rate for each 
applicable idle duty cycle, mifuelidle. These declared 
values may not be lower than any corresponding measured values 
determined in this section. You may select any value that is at or 
above the corresponding measured value. These declared fuel-consumption 
rates, which serve as emission standards, represent collectively as the 
certified powertrain fuel map.
    (2) Powertrain output speed per unit of vehicle speed. If the test 
is done with the dynamometer connected at the wheel hubs set 
ka to the axle ratio of the rear axle that was used in the 
test. If the vehicle does not have a drive axle, such as hybrid 
vehicles with direct electric drive, let ka = 1.
[GRAPHIC] [TIFF OMITTED] TR25OC16.138

    (3) Positive work, W[cycle], over the duty cycle at the 
transmission output or wheel hubs from the powertrain test.
    (4) The following table illustrates the GEM data inputs 
corresponding to the different vehicle configurations:
[GRAPHIC] [TIFF OMITTED] TR25OC16.139


[[Page 74099]]


    (p) Correct the measured or calculated fuel mass, mfuel, 
and idle fuel mass flow rate, mifuelidle if applicable, for 
each test result to a mass-specific net energy content of a reference 
fuel as described in Sec.  1036.535(b)(11), replacing mifuel 
with mfuel where applicable in Eq. 1036.535-3.
    (q) For each test run, record the engine speed and torque as 
defined in 40 CFR 1065.915(d)(5) with a minimum sampling frequency of 1 
Hz. These engine speed and torque values represent a duty cycle that 
can be used for separate testing with an engine mounted on an engine 
dynamometer, such as for a selective enforcement audit as described in 
Sec.  1037.301.


Sec.  1037.551  Engine-based simulation of powertrain testing.

    Section 1037.550 describes how to measure fuel consumption over 
specific duty cycles with an engine coupled to a transmission; Sec.  
1037.550(q) describes how to create equivalent duty cycles for 
repeating those same measurements with just the engine. This Sec.  
1037.551 describes how to perform this engine testing to simulate the 
powertrain test. These engine-based measurements may be used for 
confirmatory testing as described in Sec.  1037.235, or for selective 
enforcement audits as described in Sec.  1037.301, as long as the test 
engine's operation represents the engine operation observed in the 
powertrain test. If we use this approach for confirmatory testing, when 
making compliance determinations, we will consider the uncertainty 
associated with this approach relative to full powertrain testing. Use 
of this approach for engine SEAs is optional for engine manufacturers.
    (a) Use the procedures of 40 CFR part 1065 to set up the engine, 
measure emissions, and record data. Measure individual parameters and 
emission constituents as described in this section. Measure 
NOX emissions for each sampling period in grams. You may 
perform these measurements using a NOX emission-measurement 
system that meets the requirements of 40 CFR part 1065, subpart J. 
Include these measured NOX values any time you report to us 
your greenhouse gas emissions or fuel consumption values from testing 
under this section. If a system malfunction prevents you from measuring 
NOX emissions during a test under this section but the test 
otherwise gives valid results, you may consider this a valid test and 
omit the NOX emission measurements; however, we may require 
you to repeat the test if we determine that you inappropriately voided 
the test with respect to NOX emission measurement. For 
hybrid powertrains, correct for the net energy change of the energy 
storage device as described in 40 CFR 1066.501.
    (b) Operate the engine over the applicable engine duty cycles 
corresponding to the vehicle cycles specified in Sec.  1037.510(a)(2) 
for powertrain testing over the applicable vehicle simulations 
described in Sec.  1037.550(h). Warm up the engine to prepare for the 
transient test or one of the highway cruise cycles by operating it one 
time over one of the simulations of the corresponding duty cycle. Warm 
up the engine to prepare for the idle test by operating it over a 
simulation of the 65-mi/hr highway cruise cycle for 600 seconds. Within 
60 seconds after concluding the warm up cycle, start emission sampling 
while the engine operates over the duty cycle. You may perform any 
number of test runs directly in succession once the engine is warmed 
up. Perform cycle validation as described in 40 CFR 1065.514 for engine 
speed, torque, and power.
    (c) Calculate the mass of fuel consumed as described in Sec.  
1037.550(m) and (n). Correct each measured value for the test fuel's 
mass-specific net energy content as described in 40 CFR 1036.530. Use 
these corrected values to determine whether the engine's emission 
levels conform to the declared fuel-consumption rates from the 
powertrain test.


Sec.  1037.555  Special procedures for testing Phase 1 hybrid systems.

    This section describes the procedure for simulating a chassis test 
with a pre-transmission or post-transmission hybrid system for A to B 
testing of Phase 1 vehicles. These procedures may also be used to 
perform A to B testing with non-hybrid systems. See Sec.  1037.550 for 
Phase 2 hybrid systems.
    (a) Set up the engine according to 40 CFR 1065.110 to account for 
work inputs and outputs and accessory work.
    (b) Collect CO2 emissions while operating the system 
over the test cycles specified in Sec.  1037.510(a)(1).
    (c) Collect and measure emissions as described in 40 CFR part 1066. 
Calculate emission rates in grams per ton-mile without rounding. 
Determine values for A, B, C, and M for the vehicle being simulated as 
specified in 40 CFR part 1066. If you will apply an improvement factor 
or test results to multiple vehicle configurations, use values of A, B, 
C, M, ka, and r that represent the vehicle configuration 
with the smallest potential reduction in greenhouse gas emissions as a 
result of the hybrid capability.
    (d) Calculate the transmission output shaft's angular speed target 
for the driver model, fnref,driver, from the linear speed 
associated with the vehicle cycle using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.140

Where:

vcyclei = vehicle speed of the test cycle for each point, 
i, starting from i = 1.
ka = drive axle ratio, as declared by the manufacturer.
r = radius of the loaded tires, as declared by the manufacturer.

    (e) Use speed control with a loop rate of at least 100 Hz to 
program the dynamometer to follow the test cycle, as follows:
    (1) Calculate the transmission output shaft's angular speed target 
for the dynamometer, fnref,dyno, from the measured linear 
speed at the dynamometer rolls using the following equation:

[[Page 74100]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.141

Where:

[GRAPHIC] [TIFF OMITTED] TR25OC16.142

T = instantaneous measured torque at the transmission output shaft.
Fbrake = instantaneous brake force applied by the driver 
model to add force to slow down the vehicle.
t = elapsed time in the driving schedule as measured by the 
dynamometer, in seconds.

    (2) For each test, validate the measured transmission output 
shaft's speed with the corresponding reference values according to 40 
CFR 1065.514(e). You may delete points when the vehicle is stopped. 
Perform the validation based on speed values at the transmission output 
shaft. For steady-state tests (55 mi/hr and 65 mi/hr cruise), apply 
cycle-validation criteria by treating the sampling periods from the two 
tests as a continuous sampling period. Perform this validation based on 
the following parameters:

  Table 1 of Sec.   1037.555--Statistical Criteria for Validating Duty
                                 Cycles
------------------------------------------------------------------------
                 Parameter                          Speed control
------------------------------------------------------------------------
Slope, a1.................................  0.950 <= a1 <= 1.030.
Absolute value of intercept,                <= 2.0% of maximum test
 [bond]a0[bond].                             speed.
Standard error of estimate, SEE...........  <= 5% of maximum test speed.
Coefficient of determination, r\2\........  >= 0.970.
------------------------------------------------------------------------

    (f) Send a brake signal when throttle position is equal to zero and 
vehicle speed is greater than the reference vehicle speed from the test 
cycle. Set a delay before changing the brake state to prevent the brake 
signal from dithering, consistent with good engineering judgment.
    (g) The driver model should be designed to follow the cycle as 
closely as possible and must meet the requirements of Sec.  1037.510 
for steady-state testing and 40 CFR 1066.430(e) for transient testing. 
The driver model should be designed so that the brake and throttle are 
not applied at the same time.
    (h) Correct for the net energy change of the energy storage device 
as described in 40 CFR 1066.501.
    (i) Follow the provisions of Sec.  1037.510 to weight the cycle 
results and Sec.  1037.615 to calculate improvement factors and 
benefits for advanced technologies for Phase 1 vehicles.


Sec.  1037.560  Axle efficiency test.

    This section describes a procedure for mapping axle efficiency 
through a determination of axle power loss.
    (a) You may establish axle power loss maps based on testing any 
number of axle configurations within an axle family as specified in 
Sec.  1037.232. You may share data across a family of axle 
configurations, as long as you test the axle configuration with the 
lowest efficiency from the axle family; this will generally involve 
testing the axle with the highest axle ratio. For vehicles with tandem 
drive axles, always test each drive axle separately. For tandem axles 
that can be disconnected, test both single-drive and tandem axle 
configurations. Alternatively, you may ask us to approve power loss 
maps for untested configurations that are analytically derived from 
tested configurations within the same family (see Sec.  1037.235(h)).
    (b) Prepare an axle assembly for testing as follows:
    (1) Select an axle assembly with less than 500 hours of operation 
before testing. Assemble the axle in its housing, along with wheel ends 
and bearings.
    (2) If you have a family of axle assemblies with different axle 
ratios, you may test multiple configurations using a common axle 
housing, wheel ends, and bearings.
    (3) Install the axle on the dynamometer with an input shaft angle 
perpendicular to the axle.
    (i) For axle assemblies with or without a locking main 
differential, test the axle using one of the following methods:
    (A) Lock the main differential and test it with one electric motor 
on the input shaft and a second electric motor on the output side of 
the output shaft that has the speed-reduction gear attached to it.
    (B) Test with the main differential unlocked and with one electric 
motor on the input shaft and electric motors on the output sides of 
each of the output shafts.
    (ii) For drive-through tandem-axle setups, lock the longitudinal 
and inter-wheel differentials.
    (4) Add gear oil according to the axle manufacturer's instructions. 
If the axle manufacturer specifies multiple gear oils, select the one 
with the highest viscosity at operating temperature. You may use a 
lower-viscosity gear oil if we approve that as critical emission-
related maintenance under Sec.  1037.125. Fill the gear oil to a level 
that represents in-use operation. You may use an external gear oil 
conditioning system, as long as it does not affect measured values.
    (5) Install equipment for measuring the bulk temperature of the 
gear oil in the oil sump or a similar location.
    (6) Break in the axle assembly using good engineering judgment. 
Maintain gear oil temperature at or below 100 [deg]C throughout the 
break-in period.
    (7) Drain the gear oil following the break-in procedure and repeat 
the filling procedure described in paragraph (b)(3) of this section.
    (c) Measure input and output speed and torque as described in 40 
CFR 1065.210(b), except that you may use a magnetic or optical shaft-
position detector with only one count per revolution. Use a speed-
measurement system that meets an accuracy of

[[Page 74101]]

0.05% of point. Use torque transducers that meet an 
accuracy requirement of 0.2% of the maximum axle input 
torque or output torque tested for loaded test points, and 1.0 N[sdot]m for unloaded test points. Calibrate and verify 
measurement instruments according to 40 CFR part 1065, subpart C. 
Command speed and torque at a minimum of 10 Hz, and record all data, 
including bulk oil temperature, as 1 Hz mean values.
    (d) The test matrix consists of output torque and wheel speed 
values meeting the following specifications:
    (1) Output torque includes both loaded and unloaded operation. For 
measurement involving unloaded output torque, also called spin loss 
testing, the wheel end is not connected to the dynamometer and is left 
to rotate freely; in this condition the input torque (to maintain 
constant wheel speed) equals the power loss. Test axles at a range of 
output torque values, as follows:
    (i) 0, 500, 1000, 2000, 3000, and 4000 N[sdot]m for single drive 
axle applications for tractors and for vocational Heavy HDV with a 
single drive axle.
    (ii) 0, 250, 500, 1000, 1500, and 2000 N[sdot]m for tractors, for 
vocational Heavy HDV with tandem drive axles, and for all vocational 
Light HDV or vocational Medium HDV.
    (iii) You may exclude values that exceed your axle's maximum torque 
rating.
    (2) Determine maximum wheel speed corresponding to a vehicle speed 
of 65 mi/hr based on the smallest tire (as determined using Sec.  
1037.520(c)(1)) that will be used with the axle. If you do not know the 
smallest tire size, you may use a default size of 650 r/mi. Use wheel 
rotational speeds for testing that include 50 r/min and speeds in 100 
r/min increments that encompass the maximum wheel speed (150, 250, 
etc.).
    (3) You may test the axle at additional speed and torque setpoints.
    (e) Determine axle efficiency using the following procedure:
    (1) Maintain ambient temperature between (15 and 35) [deg]C 
throughout testing. Measure ambient temperature within 1.0 m of the 
axle assembly. Verify that critical axle settings (such as bearing 
preload, backlash, and oil sump level) are within specifications before 
and after testing.
    (2) Maintain gear oil temperature at (81 to 83) [deg]C. Measure 
gear oil temperature at the drain of the sump. You may use an external 
gear oil conditioning system, as long as it does not affect measured 
values.
    (3) Use good engineering judgment to warm up the axle by operating 
it until the gear oil is within the specified temperature range.
    (4) Stabilize operation at each point in the test matrix for at 
least 10 seconds, then measure the input torque, output torque, and 
wheel speed for at least 10 seconds, recording the mean values for all 
three parameters. Calculate power loss as described in paragraph (f) of 
this section based on torque and speed values at each test point.
    (5) Perform the map sequence described in paragraph (e)(4) of this 
section three times. Remove torque from the input shaft and allow the 
axle to come to a full stop before each repeat measurement.
    (6) You may need to perform additional testing based on a 
calculation of repeatability at a 95% confidence level. Make a separate 
repeatability calculation for the three data points at each operating 
condition in the test matrix. If the confidence limit is greater than 
0.10% for loaded tests or greater than 0.05% for unloaded tests, 
perform another repeat of the axle power loss map and recalculate the 
repeatability for the whole set of test results. Continue testing until 
the repeatability is at or below the specified values for all operating 
conditions.
    Calculate a confidence limit representing the repeatability in 
establishing a 95% confidence level using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.143

Where:

[sigma]Ploss = standard deviation of power loss values at 
a given torque-speed setting (see 40 CFR 1065.602(c)).
N = number of repeat tests.
Pmax = maximum output torque setting from the test 
matrix.

    Example: 
[sigma]Ploss = 165.0 W
N = 3
Pmax = 314200 W
[GRAPHIC] [TIFF OMITTED] TR25OC16.144


    (7) Calculate mean input torque, Tin mean output torque, 
Tout, and mean wheel rotational speed, fnwheel, 
for each point in the test matrix using the results from all the repeat 
tests.
    (f) Calculate the mean power loss, Ploss, at each 
operating condition in the test matrix as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.320

    (2) For each test calculate the mean power loss, Ploss, 
as follows:

[[Page 74102]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.145

Where:

Tin = mean input torque.
fnwheel = mean wheel rotational speed.
ka = drive axle ratio, expressed to at least the nearest 
0.001.
Tout = mean output torque. Let Tout = 0 for 
all unloaded tests.

    Example: 
Tin = 845.1 N[middot]m fnwheel = 100 r/min = 
10.472 rad/s
ka = 3.731
Tout = 3000 N[middot]m
Ploss = 845.1[middot]10.472[middot]3.731 - 
3000[middot]10.472
Ploss = 1602.9 W = 1.6029 kW
Ploss,2 = 1601.9 W = 1.6019 kW
Ploss,3 = 1603.9 W = 1.6039 kW
[GRAPHIC] [TIFF OMITTED] TR25OC16.146

    (g) Create a table showing the mean power loss,
    [GRAPHIC] [TIFF OMITTED] TR25OC16.322
    

corresponding to each mean output torque and mean wheel speed for input 
into GEM. Express wheel speed in r/min to one decimal place; express 
output torque in N[middot]m to two decimal places; express power loss 
in kW to four decimal places. Select mean power loss values at or above 
the corresponding value calculated in paragraph (f) of this section. 
Use good engineering judgment to select values that will be at or above 
the mean power loss values for your production axles. For vehicles with 
tandem drive axles, sum the power losses and output torques of the 
individual axles when creating your table. For tandem axles with a 
disconnect, input a separate table into GEM for the single and tandem 
drive axle configurations. Vehicle manufacturers will use these 
declared mean power loss values for certification.


Sec.  1037.565  Transmission efficiency test.

    This section describes a procedure for mapping transmission 
efficiency through a determination of transmission power loss.
    (a) You may establish transmission power loss maps based on testing 
any number of transmission configurations within a transmission family 
as specified in Sec.  1037.232. You may share data across any 
configurations within the family, as long as you test the transmission 
configuration with the lowest efficiency from the emission family. 
Alternatively, you may ask us to approve power loss maps for untested 
configurations that are analytically derived from tested configurations 
within the same family (see Sec.  1037.235(h)).
    (b) Prepare a transmission for testing as follows:
    (1) Select a transmission with less than 500 hours of operation 
before testing.
    (2) Mount the transmission to the dynamometer such that the geared 
shaft in the transmission is aligned with the input shaft from the 
dynamometer.
    (3) Add transmission oil according to the transmission 
manufacturer's instructions. If the transmission manufacturer specifies 
multiple transmission oils, select the one with the highest viscosity 
at operating temperature. You may use a lower-viscosity transmission 
oil if we approve that as critical emission-related maintenance under 
Sec.  1037.125. Fill the transmission oil to a level that represents 
in-use operation. You may use an external transmission oil conditioning 
system, as long as it does not affect measured values.
    (4) Include any internal and external pumps for hydraulic fluid and 
lubricating oil in the test. Determine the work required to drive an 
external pump according to 40 CFR 1065.210.
    (5) Install equipment for measuring the bulk temperature of the 
transmission oil in the oil sump or a similar location.
    (6) If the transmission is equipped with a torque converter, lock 
it for all testing performed in this section.
    (7) Break in the transmission using good engineering judgment. 
Maintain transmission oil temperature at (87 to 93) [deg]C for 
automatic transmissions and transmissions having more than two friction 
clutches, and at (77 to 83) [deg]C for all other transmissions. You may 
ask us to approve a different range of transmission oil temperatures if 
you have data showing that it better represents in-use operation.
    (c) Measure input and output shaft speed and torque as described in 
40 CFR 1065.210(b), except that you may use a magnetic or optical 
shaft-position detector with only one count per revolution. Use a-speed 
measurement system that meets an accuracy of 0.05% of 
point. Use torque transducers that meet an accuracy requirement of 
0.2% of the transmission's maximum rated input torque or 
output torque for the selected gear ratio, for loaded test points, and 
0.1% of the transmission's maximum rated input torque for 
unloaded test points. Calibrate and verify measurement instruments 
according to 40 CFR part 1065, subpart C. Command speed and torque at a 
minimum of 10 Hz, and record all data, including bulk oil temperature, 
at a minimum of 1 Hz mean values.
    (d) The test matrix consists of transmission input shaft speeds and 
torque setpoints meeting the following specifications for each gear 
tested:
    (1) Include transmission input shaft speeds at the maximum rated 
input shaft speed, 600 r/min, and three equally spaced intermediate 
speeds. The intermediate speed points may be adjusted to the nearest 50 
or 100 r/min.
    (2) Include one loaded torque setpoint between 75% and 105% of the 
maximum transmission input torque and one unloaded (zero-torque) 
setpoint. You may test at any number of additional torque setpoints to 
improve accuracy. Note that GEM calculates power loss between tested or 
default values by linear interpolation.
    (3) In the case of transmissions that automatically go into neutral 
when the vehicle is stopped, also perform tests at 600 r/min and 800 r/
min with the transmission in neutral and the transmission output fixed 
at zero speed.
    (e) Determine transmission torque loss using the following 
procedure:
    (1) Maintain ambient temperature between (15 and 35) [deg]C 
throughout testing. Measure ambient temperature within 1.0 m of the 
transmission.
    (2) Maintain transmission oil temperature as described in paragraph 
(b)(7) of this section. You may use an external transmission oil 
conditioning system, as long as it does not affect measured values.

[[Page 74103]]

    (3) Use good engineering judgment to warm up the transmission 
according to the transmission manufacturer's specifications.
    (4) Perform unloaded transmission tests by disconnecting the 
transmission output shaft from the dynamometer and letting it rotate 
freely. If the transmission adjusts pump pressure based on whether the 
vehicle is moving or stopped, set up the transmission for unloaded 
tests to operate as if the vehicle is moving.
    (5) For transmissions that have multiple configurations for a given 
gear ratio, such as dual-clutch transmissions that can pre-select an 
upshift or downshift, set the transmission to operate in the 
configuration with the greatest power loss. Alternatively, test in each 
configuration and use good engineering judgment to calculate a weighted 
power loss for each test point under this section based on field data 
that characterizes the degree of in-use operation in each 
configuration.
    (6) Operate the transmission in the top gear at a selected torque 
setpoint with the input shaft speed at one of the speed setpoints for 
at least 10 seconds, then measure the speed and torque of the input and 
output shafts for at least 10 seconds. You may omit measurement of 
output shaft speeds if your transmission is configured is a way that 
does not allow slip. Calculate arithmetic mean values for all speed and 
torque values over each measurement period. Repeat this stabilization, 
measurement, and calculation for the other speed and torque setpoints 
from the test matrix in any sequence. Calculate power loss as described 
in paragraph (f) of this section based on torque and speed values at 
each test point.
    (7) Repeat the procedure described in paragraph (e) for all gears, 
or for all gears down to a selected gear. GEM will use default values 
for any gears not tested.
    (8) Perform the test sequence described in paragraphs (d)(6) and 
(7) of this section three times. You may do this repeat testing at any 
given test point before you perform measurements for the whole test 
matrix. Remove torque from the transmission input shaft and bring the 
transmission to a complete stop before each repeat measurement.
    (9) You may need to perform additional testing based on a 
calculation of repeatability at a 95% confidence level. Make a separate 
repeatability calculation for the three data points at each operating 
condition in the test matrix. If the confidence limit is greater than 
0.10% for loaded tests or greater than 0.05% for unloaded tests, 
perform another repeat of measurements at that operating condition and 
recalculate the repeatability for the whole set of test results. 
Continue testing until the repeatability is at or below the specified 
values for all operating conditions. Calculate a confidence limit 
representing the repeatability in establishing a 95% confidence level 
using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.147

Where:

[sigma]Ploss = standard deviation of power loss values at 
a given test point (see 40 CFR 1065.602(c)).
N = number of repeat tests.
Prated = the transmission's rated input power for a given 
gear. For testing in neutral, use the value of Prated for 
the top gear.

    Example: 
[sigma]Ploss = 120.0 W
N = 3
Prated = 314200 W
[GRAPHIC] [TIFF OMITTED] TR25OC16.148

Confidence Limit = 0.0432%

    (10) Calculate mean input shaft torque, Tin, mean output 
shaft torque, Tout, mean input shaft speed, fnin, 
and mean output shaft speed, fnout, for each point in the 
test matrix using the results from all the repeat tests.
    (f) Calculate the mean power loss, Ploss, at each 
operating condition in the test matrix as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.321

    (2) For each test calculate the mean power loss, Ploss, 
as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.149

Where:

 Tin = mean input shaft torque.
fnin = mean input shaft speed.
Tout = mean output shaft torque. Let Tout = 0 
for all unloaded tests.
fnout = mean output shaft speed. Let f;nout= 0 
for all tests with the transmission in neutral. See paragraph (f)(3) 
of this

[[Page 74104]]

section for calculating for certain transmission configurations.

    Example: 
Tin = 1000.0 N[middot]m
fnin = 1000 r/min = 104.72 rad/sec
Tout = 2654.5 N[middot]m
fnout = 361.27 r/min = 37.832 rad/s
Ploss,1 = 1000.0[middot]104.72 - 2654.5[middot]37.832
Ploss = 4295 W = 4.295 kW
Ploss,2 = 4285 W = 4.285 kW
Ploss,3 = 4292 W = 4.292 kW
[GRAPHIC] [TIFF OMITTED] TR25OC16.150

    (3) For transmissions that are configured in a way that does not 
allow slip, you may calculate fnout based on the gear ratio 
using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.151

Where:

kg = transmission gear ratio, expressed to at least the 
nearest 0.001.

    (g) Create a table showing the mean power loss,
    [GRAPHIC] [TIFF OMITTED] TR25OC16.322
    

corresponding to each mean transmission input speed and mean input 
torque for input into GEM. Also include mean power loss in neutral for 
each tested engines speed, if applicable. Express transmission input 
speed in r/min to one decimal place; express input torque in Nm 
to two decimal places; express power loss in kW to four decimal places. 
Select mean power loss values at or above the corresponding value 
calculated in paragraph (f) of this section. Use good engineering 
judgment to select values that will be at or above the mean power loss 
values for your production axles. Vehicle manufacturers will use these 
declared mean power loss values for certification.

Subpart G--Special Compliance Provisions


Sec.  1037.601  General compliance provisions.

    (a) Engine and vehicle manufacturers, as well as owners and 
operators of vehicles subject to the requirements of this part, and all 
other persons, must observe the provisions of this part, the applicable 
provisions of 40 CFR part 1068, and the applicable provisions of the 
Clean Air Act. The provisions of 40 CFR part 1068 apply for heavy-duty 
vehicles as specified in that part, subject to the provisions:
    (1) Except as specifically allowed by this part or 40 CFR part 
1068, it is a violation of Sec.  1068.101(a)(1) to introduce into U.S. 
commerce a tractor or vocational vehicle containing an engine not 
certified to the applicable requirements of this part and 40 CFR part 
86. Further, it is a violation to introduce into U.S. commerce a Phase 
1 tractor containing an engine not certified for use in tractors; or to 
introduce into U.S. commerce a vocational vehicle containing a light 
heavy-duty or medium heavy-duty engine not certified for use in 
vocational vehicles. These prohibitions apply especially to the vehicle 
manufacturer. Note that this paragraph (a)(1) allows the use of Heavy 
heavy-duty tractor engines in vocational vehicles.
    (2) The provisions of 40 CFR 1068.105(a) apply for vehicle 
manufacturers installing engines certified under 40 CFR part 1036 as 
further limited by this paragraph (a)(2). If new engine emission 
standards apply in a given model year, you may install normal 
inventories of engines from the preceding model year under the 
provisions of 40 CFR 1068.105(a) through March 31 of that year without 
our approval; you may not install such engines after March 31 of that 
year unless we approve it in advance. Installing such engines after 
March 31 without our prior approval is considered to be prohibited 
stockpiling of engines. In a written request for our approval, you must 
describe how your circumstances led you and your engine supplier to 
have normal inventories of engines that were not used up in the 
specified time frame. We will approve your request for up to three 
additional months to install up to 50 engines under this paragraph 
(a)(2) if we determine that the excess inventory is a result of 
unforeseeable circumstances and should not be considered circumvention 
of emission standards. Note that 40 CFR 1068.105(a) allows vehicle 
manufacturers to use up only normal inventories of engines meeting less 
stringent standards; if, for example, a vehicle manufacturer's normal 
practice is to receive a shipment of engines every two weeks, it will 
deplete its potential to install previous-tier engines under this 
paragraph (a)(2) well before March 31 in the year that new standards 
apply.
    (3) The exemption provisions of 40 CFR 1068.201 through 1068.230, 
1068.240, and 1068.260 through 265 apply for heavy-duty motor vehicles. 
Other exemption provisions, which are specific to nonroad engines, do 
not apply for heavy-duty vehicles or heavy-duty engines.
    (4) The tampering prohibition in 40 CFR 1068.101(b)(1) applies for 
alternative fuel conversions as specified in 40 CFR part 85, subpart F.
    (5) The warranty-related prohibitions in section 203(a)(4) of the 
Act (42 U.S.C. 7522(a)(4)) apply to manufacturers of new heavy-duty 
highway vehicles in addition to the prohibitions described in 40 CFR 
1068.101(b)(6). We may assess a civil penalty up to $44,539 for each 
engine or vehicle in violation.
    (6) A vehicle manufacturer that completes assembly of a vehicle at 
two or more facilities may ask to use as the date of manufacture for 
that vehicle the date on which manufacturing is completed at the place 
of main assembly, consistent with provisions of 49 CFR 567.4. Note that 
such staged assembly is subject to the corresponding provisions of 40 
CFR 1068.260. Include your request in your application for 
certification, along with a summary of your staged-assembly process. 
You may ask to apply this allowance to some or all of the vehicles in 
your vehicle family. Our approval is effective when we grant your 
certificate. We will not approve your request if we determine

[[Page 74105]]

that you intend to use this allowance to circumvent the intent of this 
part.
    (7) The provisions for selective enforcement audits apply as 
described in 40 CFR part 1068, subpart E, and subpart D of this part.
    (b) Vehicles exempted from the applicable standards of 40 CFR part 
86 other than glider vehicles are exempt from the standards of this 
part without request. Similarly, vehicles other than glider vehicles 
are exempt without request if the installed engine is exempted from the 
applicable standards in 40 CFR part 86.
    (c) The prohibitions of 40 CFR 1068.101 apply for vehicles subject 
to the requirements of this part. The actions prohibited under this 
provision include the introduction into U.S. commerce of a complete or 
incomplete vehicle subject to the standards of this part where the 
vehicle is not covered by a valid certificate of conformity or 
exemption.
    (d) The emergency vehicle field modification provisions of 40 CFR 
85.1716 apply with respect to the standards of this part.
    (e) Under Sec.  1037.801, certain vehicles are considered to be new 
vehicles when they are imported into the United States, even if they 
have previously been used outside the country. Independent Commercial 
Importers may use the provisions of 40 CFR part 85, subpart P, and 40 
CFR 85.1706(b) to receive a certificate of conformity for engines and 
vehicles meeting all the requirements of 40 CFR part 1036 and this part 
1037.
    (f) Standards apply to multi-fuel vehicles as described for engines 
in 40 CFR 1036.601(d).


Sec.  1037.605  Installing engines certified to alternate standards for 
specialty vehicles.

    (a) General provisions. This section allows vehicle manufacturers 
to introduce into U.S. commerce certain new motor vehicles using 
engines certified to alternate emission standards specified in 40 CFR 
part 86 for motor vehicle engines used in specialty vehicles. You may 
not install an engine certified to these alternate standards if there 
is an engine certified to the full set of requirements of 40 CFR part 
86 that has the appropriate physical and performance characteristics to 
power the vehicle. Note that, although these alternate emission 
standards are mostly equivalent to standards that apply for nonroad 
engines under 40 CFR part 1039 or 1048, they are specific to motor 
vehicle engines. The alternate standards for compression-ignition 
engines at or above 56 kW are described in 40 CFR 86.007-11(g); the 
alternate standards for spark-ignition engines are described in 40 CFR 
86.008-10(g). The provisions of this section apply for the following 
types of specialty vehicles:
    (1) All-terrain motor vehicles with portal axles (i.e., axles that 
are offset from the corresponding wheel centerline by a gear assembly) 
or any axle configuration involving gear reduction such that the wheels 
rotate more slowly than the axle.
    (2) Amphibious vehicles.
    (3) Vehicles with maximum speed at or below 45 miles per hour. If 
your vehicle is speed-limited to meet this specification by reducing 
maximum speed below what is otherwise possible, this speed limitation 
must be programmed into the engine or vehicle's electronic control 
module in a way that is tamper-proof. If your vehicles are not 
inherently limited to a maximum speed at or below 45 miles per hour, 
they may qualify under this paragraph (a)(3) only if we approve your 
design to limit maximum speed as being tamper-proof in advance.
    (4) Through model year 2027, vehicles with a hybrid powertrain in 
which the engine provides energy for the Rechargeable Energy Storage 
System.
    (b) Notification and reporting requirements. Send the Designated 
Compliance Officer written notification describing your plans before 
using the provisions of this section. In addition, by February 28 of 
each calendar year (or less often if we tell you), send the Designated 
Compliance Officer a report with all the following information:
    (1) Identify your full corporate name, address, and telephone 
number.
    (2) List the vehicle models for which you used this exemption in 
the previous year and identify the engine manufacturer and engine model 
for each vehicle model. Also identify the total number of vehicles 
produced in the previous year.
    (c) Production limits. You may produce up to 1,000 hybrid vehicles 
in a given model year through model year 2027, and up to 200 of each 
type of vehicle identified in paragraph (a)(1) through (3) of this 
section in a given model year. This includes vehicles produced by 
affiliated companies. If you exceed this limit, the number of vehicles 
that exceed the limit for the model year will not be covered by a valid 
certificate of conformity. For the purpose of this paragraph (c), we 
will count all vehicles labeled or otherwise identified as exempt under 
this section.
    (d) Vehicle standards. The vehicle standards of this part apply as 
follows for these vehicles:
    (1) Vehicles qualifying under paragraphs (a)(1) through (3) of this 
section are subject to evaporative emission standards of Sec.  
1037.103, but are exempt from the other requirements of this part, 
except as specified in this section and in Sec.  1037.601. These 
vehicles must include a label as specified in Sec.  1037.135(a) with 
the information from Sec.  1037.135(c)(1) and (2) and the following 
statement: ``THIS VEHICLE IS EXEMPT FROM GREENHOUSE GAS STANDARDS UNDER 
40 CFR 1037.605.''
    (2) Hybrid vehicles using the provisions of this section remain 
subject to the vehicle standards and all other requirements of this 
part 1037. For example, you may need to use GEM in conjunction with 
powertrain testing to demonstrate compliance with emission standards 
under subpart B of this part.


Sec.  1037.610  Vehicles with off-cycle technologies.

    (a) You may ask us to apply the provisions of this section for 
CO2 emission reductions resulting from vehicle technologies 
that were not in common use with heavy-duty vehicles before model year 
2010 that are not reflected in GEM. While you are not required to prove 
that such technologies were not in common use with heavy-duty vehicles 
before model year 2010, we will not approve your request if we 
determine that they do not qualify. These may be described as off-cycle 
or innovative technologies. You may apply these provisions for 
CO2 emission reductions reflected in the specified test 
procedures if they are not reflected in GEM, except as allowed under 
paragraph (g) of this section. We will apply these provisions only for 
technologies that will result in measurable, demonstrable, and 
verifiable real-world CO2 emission reductions.
    (b) The provisions of this section may be applied as either an 
improvement factor or as a separate credit, consistent with good 
engineering judgment. Note that the term ``credit'' in this section 
describes an additive adjustment to emission rates and is not 
equivalent to an emission credit in the ABT program of subpart H of 
this part. We recommend that you base your credit/adjustment on A to B 
testing of pairs of vehicles differing only with respect to the 
technology in question.
    (1) Calculate improvement factors as the ratio of in-use emissions 
with the technology divided by the in-use emissions without the 
technology. Use the improvement-factor approach where good engineering 
judgment indicates that the actual benefit will be proportional to 
emissions measured

[[Page 74106]]

over the test procedures specified in this part.
    (2) Calculate separate credits (g/ton-mile) based on the difference 
between the in-use emission rate with the technology and the in-use 
emission rate without the technology. Subtract this value from your GEM 
result and use this adjusted value to determine your FEL. Use the 
separate-credit approach where good engineering judgment indicates that 
the actual benefit will not be proportional to emissions measured over 
the test procedures specified in this part.
    (3) We may require you to discount or otherwise adjust your 
improvement factor or credit to account for uncertainty or other 
relevant factors.
    (c) You may perform A to B testing by measuring emissions from the 
vehicles during chassis testing or from in-use on-road testing. You may 
also ask to use modified powertrain testing. If you use on-road 
testing, we recommend that you test according to SAE J1321, Fuel 
Consumption Test Procedure--Type II, revised February 2012, or SAE 
J1526, SAE Fuel Consumption Test Procedure (Engineering Method), 
Revised September 2015 (see Sec.  1037.810 for information on 
availability of SAE standards), subject to the following provisions:
    (1) The minimum route distance is 100 miles.
    (2) The route selected must be representative in terms of grade. We 
will take into account published and relevant research in determining 
whether the grade is representative.
    (3) Control vehicle speed over the route to be representative of 
the drive-cycle weighting adopted for each regulatory subcategory, as 
specified in Sec.  1037.510(c), or apply a correction to account for 
the appropriate weighting. For example, if the route selected for an 
evaluation of a combination tractor with a sleeper cab contains only 
interstate driving at 65 mi/hr, the improvement factor would apply only 
to 86 percent of the weighted result.
    (4) The ambient air temperature must be between (5 and 35) [deg]C, 
unless the technology requires other temperatures for demonstration.
    (5) We may allow you to use a Portable Emissions Measurement System 
(PEMS) device for measuring CO2 emissions during the on-road 
testing.
    (d) Send your request to the Designated Compliance Officer. We 
recommend that you do not begin collecting test data (for submission to 
EPA) before contacting us. For technologies for which the engine 
manufacturer could also claim credits (such as transmissions in certain 
circumstances), we may require you to include a letter from the engine 
manufacturer stating that it will not seek credits for the same 
technology. Your request must contain the following items:
    (1) A detailed description of the off-cycle technology and how it 
functions to reduce CO2 emissions under conditions not 
represented on the duty cycles required for certification.
    (2) A list of the vehicle configurations that will be equipped with 
the technology.
    (3) A detailed description and justification of the selected test 
vehicles.
    (4) All testing and simulation data required under this section, 
plus any other data you have considered in your analysis. You may ask 
for our preliminary approval of your test plan under Sec.  1037.210.
    (5) A complete description of the methodology used to estimate the 
off-cycle benefit of the technology and all supporting data, including 
vehicle testing and in-use activity data. Also include a statement 
regarding your recommendation for applying the provisions of this 
section for the given technology as an improvement factor or a credit.
    (6) An estimate of the off-cycle benefit by vehicle model, and the 
fleetwide benefit based on projected sales of vehicle models equipped 
with the technology.
    (7) A demonstration of the in-use durability of the off-cycle 
technology, based on any available engineering analysis or durability 
testing data (either by testing components or whole vehicles).
    (8) A recommended method for auditing production vehicles 
consistent with the intent of 40 CFR part 1068, subpart E. We may 
approve your recommended method or specify a different method.
    (e) We may seek public comment on your request, consistent with the 
provisions of 40 CFR 86.1866. However, we will generally not seek 
public comment on credits or adjustments based on A to B chassis 
testing performed according to the duty-cycle testing requirements of 
this part or in-use testing performed according to paragraph (c) of 
this section.
    (f) We may approve an improvement factor or credit for any 
configuration that is properly represented by your testing.
    (1) For model years before 2021, you may continue to use an 
approved improvement factor or credit for any appropriate vehicle 
families in future model years through 2020.
    (2) For model years 2021 and later, you may not rely on an approval 
for model years before 2021. You must separately request our approval 
before applying an improvement factor or credit under this section for 
Phase 2 vehicles, even if we approved an improvement factor or credit 
for similar vehicle models before model year 2021. Note that Phase 2 
approval may carry over for multiple years.
    (g) You normally may not calculate off-cycle credits or improvement 
factors under this section for technologies represented by GEM, but we 
may allow you to do so by averaging multiple GEM runs for special 
technologies for which a single GEM run cannot accurately reflect in-
use performance. For example, if you use an idle-reduction technology 
that is effective 80 percent of the time, we may allow you to run GEM 
with the technology active and with it inactive, and then apply an 80% 
weighting factor to calculate the off-cycle credit or improvement 
factor. You may need to perform testing to establish proper weighting 
factors or otherwise quantify the benefits of the special technologies.


Sec.  1037.615  Advanced technologies.

    (a) This section applies in Phase 1 for hybrid vehicles with 
regenerative braking, vehicles equipped with Rankine-cycle engines, 
electric vehicles, and fuel cell vehicles, and in Phase 2 through model 
year 2027 for plug-in hybrid electric vehicles, electric vehicles, and 
fuel cell vehicles. You may not generate credits for Phase 1 engine 
technologies for which the engines generate credits under 40 CFR part 
1036.
    (b) Generate Phase 1 advanced-technology credits for vehicles other 
than electric vehicles as follows:
    (1) Measure the effectiveness of the advanced system by chassis-
testing a vehicle equipped with the advanced system and an equivalent 
conventional vehicle, or by testing the hybrid systems and the 
equivalent non-hybrid systems as described in Sec.  1037.555. Test the 
vehicles as specified in subpart F of this part. For purposes of this 
paragraph (b), a conventional vehicle is considered to be equivalent if 
it has the same footprint (as defined in 40 CFR 86.1803), vehicle 
service class, aerodynamic drag, and other relevant factors not 
directly related to the hybrid powertrain. If you use Sec.  1037.540 to 
quantify the benefits of a hybrid system for PTO operation, the 
conventional vehicle must have the same number of PTO circuits and have 
equivalent PTO power. If you do not produce an equivalent vehicle, you 
may create and test a prototype equivalent vehicle. The conventional 
vehicle is

[[Page 74107]]

considered Vehicle A and the advanced vehicle is considered Vehicle B. 
We may specify an alternate cycle if your vehicle includes a power 
take-off.
    (2) Calculate an improvement factor and g/ton-mile benefit using 
the following equations and parameters:
    (i) Improvement Factor = [(Emission Rate A)-(Emission Rate B)]/
(Emission Rate A).
    (ii) g/ton-mile benefit = Improvement Factor x (GEM Result B).
    (iii) Emission Rates A and B are the g/ton-mile CO2 
emission rates of the conventional and advanced vehicles, respectively, 
as measured under the test procedures specified in this section. GEM 
Result B is the g/ton-mile CO2 emission rate resulting from 
emission modeling of the advanced vehicle as specified in Sec.  
1037.520.
    (3) If you apply an improvement factor to multiple vehicle 
configurations using the same advanced technology, use the vehicle 
configuration with the smallest potential reduction in greenhouse gas 
emissions resulting from the hybrid capability.
    (4) Use the equations of Sec.  1037.705 to convert the g/ton-mile 
benefit to emission credits (in Mg). Use the g/ton-mile benefit in 
place of the (Std-FEL) term.
    (c) See Sec.  1037.540 for special testing provisions related to 
Phase 1 vehicles equipped with hybrid power take-off units.
    (d) For Phase 2 plug-in hybrid electric vehicles and for fuel cells 
powered by any fuel other than hydrogen, calculate CO2 
credits using an FEL based on emission measurements from powertrain 
testing. Phase 2 advanced-technology credits do not apply for hybrid 
vehicles that have no plug-in capability.
    (e) You may use an engineering analysis to calculate an improvement 
factor for fuel cell vehicles based on measured emissions from the fuel 
cell vehicle.
    (f) For electric vehicles, calculate CO2 credits using 
an FEL of 0 g/ton-mile.
    (g) As specified in subpart H of this part, advanced-technology 
credits generated from Phase 1 vehicles under this section may be used 
under this part 1037 outside of the averaging set in which they were 
generated, or they may be used under 40 CFR 86.1819 or 40 CFR part 
1036. Advanced-technology credits generated from Phase 2 vehicles are 
subject to all the averaging-set restrictions that apply to other 
emission credits.
    (h) You may certify using both provisions of this section and the 
off-cycle technology provisions of Sec.  1037.610, provided you do not 
double count emission benefits.


Sec.  1037.620  Responsibilities for multiple manufacturers.

    This section describes certain circumstances in which multiple 
manufacturers share responsibilities for vehicles they produce 
together. This section does not limit responsibilities that apply under 
the Act or these regulations for anyone meeting the definition of 
``manufacturer'' in Sec.  1037.801. Note that the definition of 
manufacturer is broad and can include persons not commercially 
considered to be manufacturers.
    (a) The following provisions apply when there are multiple persons 
meeting the definition of manufacturer in Sec.  1037.801:
    (1) Each person meeting the definition of manufacturer must comply 
with the requirements of this part that apply to manufacturers. 
However, if one person complies with a specific requirement for a given 
vehicle, then all manufacturers are deemed to have complied with that 
specific requirement.
    (2) We will apply the requirements of subparts C and D of this part 
to the manufacturer that obtains the certificate of conformity for the 
vehicle. Other manufacturers are required to comply with the 
requirements of subparts C and D of this part only when notified by us. 
In our notification, we will specify a reasonable time period in which 
you need to comply with the requirements identified in the notice. See 
Sec.  1037.601 for the applicability of 40 CFR part 1068 to these other 
manufacturers and remanufacturers.
    (b) The provisions of Sec.  1037.621, including delegated assembly, 
apply for certifying manufacturers that rely on other manufacturers to 
finish assembly in a certified configuration. The provisions of Sec.  
1037.622 generally apply for manufacturers that ship vehicles subject 
to the requirements of this part to a certifying secondary vehicle 
manufacturer. The provisions of Sec.  1037.622 also apply to the 
secondary vehicle manufacturer. If you hold the certificate of 
conformity for a vehicle only with respect to exhaust or evaporative 
emissions, and a different company holds the other certificate of 
conformity for that vehicle, the provisions of Sec.  1037.621 apply 
with respect to the certified configuration as described in your 
application for certification, and the provisions of Sec.  1037.622 
apply with respect to the certified configuration as described in the 
other manufacturer's application for certification.
    (c) Manufacturers of aerodynamic devices may perform the 
aerodynamic testing described in Sec.  1037.526 to quantify 
[Delta]CdA values for trailers and submit that data to EPA 
verification under Sec.  1037.211. Trailer manufacturers may use such 
verified data to establish input parameters for certifying their 
trailers. Both device manufacturers and trailer manufacturers are 
subject to 40 CFR part 1068, including the recall provisions described 
in 40 CFR part 1068, subpart F.
    (d) Component manufacturers (such as tire manufacturers) providing 
test data to certifying vehicle manufacturers are responsible as 
follows for test components and emission test results provided to 
vehicle manufacturers for the purpose of certification under this part:
    (1) Such test results are deemed under Sec.  1037.825 to be 
submissions to EPA. This means that you may be subject to criminal 
penalties under 18 U.S.C. 1001 if you knowingly submit false test 
results to the certifying manufacturer.
    (2) You may not cause a vehicle manufacturer to violate the 
regulations by rendering inaccurate emission test results you provide 
(or emission test results from testing of test components you provide) 
to the vehicle manufacturer (see 40 CFR 1068.101(c)).
    (3) Your provision of test components and/or emission test results 
to vehicle manufacturers for the purpose of certifying under this part 
are deemed to be an agreement to provide components to EPA for 
confirmatory testing under Sec.  1037.235.
    (e) Component manufacturers may contractually agree to process 
emission warranty claims on behalf of the certifying manufacturer with 
respect to those components, as follows:
    (1) Your fulfillment of the warranty requirements of this part is 
deemed to fulfill the vehicle manufacturer's warranty obligations under 
this part with respect to components covered by your warranty.
    (2) You may not cause a vehicle manufacturer to violate the 
regulations by failing to fulfill the emission warranty requirements 
that you contractually agreed to fulfill (see 40 CFR 1068.101(c)).
    (f) We may require component manufacturers to provide information 
or take other actions under 42 U.S.C. 7542. For example, we may require 
component manufacturers to test components they produce.


Sec.  1037.621  Delegated assembly.

    (a) This section describes provisions that allow certificate 
holders to sell or ship vehicles that are missing certain

[[Page 74108]]

emission-related components if those components will be installed by a 
secondary vehicle manufacturer. Paragraph (g) of this section similarly 
describes how dealers and distributors may modify new vehicles with 
your advance approval. (Note: See Sec.  1037.622 for provisions related 
to manufacturers introducing into U.S. commerce partially complete 
vehicles for which a secondary vehicle manufacturer holds the 
certificate of conformity.)
    (b) You do not need an exemption to ship a vehicle that does not 
include installation or assembly of certain emission-related components 
if those components are shipped along with the vehicle. For example, 
you may generally ship fuel tanks and aerodynamic devices along with 
vehicles rather than installing them on the vehicle before shipment. We 
may require you to describe how you plan to use this provision.
    (c) You may ask us at the time of certification for an exemption to 
allow you to ship your vehicles without emission-related components. If 
we allow this, you must provide emission-related installation 
instructions as specified in Sec.  1037.130. You must follow delegated-
assembly requirements in 40 CFR 1068.261 if you rely on secondary 
vehicle manufacturers to install certain technologies or components as 
specified in paragraph (d) of this section. For other technologies or 
components, we may specify conditions that we determine are needed to 
ensure that shipping the vehicle without such components will not 
result in the vehicle being operated outside of its certified 
configuration; this may include a requirement to comply with the 
delegated-assembly provisions in paragraph (d) of this section. We may 
consider your past performance when we specify the conditions that 
apply.
    (d) Delegated-assembly provisions apply as specified in this 
paragraph (d) if the certifying vehicle manufacturer relies on a 
secondary vehicle manufacturer to procure and install auxiliary power 
units, aerodynamic devices, hybrid components (for powertrain or power 
take-off), or natural gas fuel tanks. These provisions do not apply for 
other systems or components, such as air conditioning lines and 
fittings, except as specified in paragraph (c) of this section. Apply 
the provisions of 40 CFR 1068.261, with the following exceptions and 
clarifications:
    (1) Understand references to ``engines'' to refer to vehicles.
    (2) Understand references to ``aftertreatment components'' to refer 
to any relevant emission-related components under this paragraph (d).
    (3) Understand ``equipment manufacturers'' to be secondary vehicle 
manufacturers.
    (4) The provisions of 40 CFR 1068.261(b), (c)(7), (d), and (e) do 
not apply. Accordingly, the provisions of 40 CFR 1068.261(c) apply 
regardless of pricing arrangements.
    (e) Secondary vehicle manufacturers must follow the engine 
manufacturer's emission-related installation instructions. Not meeting 
the manufacturer's emission-related installation instructions is a 
violation of one or more of the prohibitions of Sec.  1068.101. We may 
also require secondary vehicle manufacturers to recall defective 
vehicles under 40 CFR 1068.505 if we determine that their manufacturing 
practices caused vehicles to not conform to the regulations. Secondary 
vehicle manufacturers may be required to meet additional requirements 
if the certifying vehicle manufacturer delegates final assembly of 
emission controls as described in paragraph (d) of this section.
    (f) Except as allowed by Sec.  1037.622, the provisions of this 
section apply to manufacturers for glider kits they produce. Note that 
under Sec.  1037.620, glider kit manufacturers are generally presumed 
to be responsible (in whole or in part) for compliance with respect to 
vehicles produced from their glider kits, even if a secondary vehicle 
manufacturer holds the certificate under Sec.  1037.622.
    (g) We may allow certifying vehicle manufacturers to authorize 
dealers or distributors to reconfigure vehicles after the vehicles have 
been introduced into commerce if they have not yet been delivered to 
the ultimate purchaser as follows:
    (1) This allowance is limited to changes from one certified 
configuration to another, as noted in the following examples:
    (i) If your vehicle family includes certified configurations with 
different axle ratios, you may authorize changing from one certified 
axle ratio to another.
    (ii) You may authorize adding a certified APU to a tractor.
    (2) Your final ABT report must accurately describe the vehicle's 
certified configuration as delivered to the ultimate purchaser. This 
means that the allowance no longer applies after you submit the final 
ABT report.
    (3) The vehicle label must accurately reflect the final vehicle 
configuration.
    (4) You must keep records to document modifications under this 
paragraph (g).
    (5) Dealers and distributors must keep a record of your authorizing 
instructions. Dealers and distributors that fail to follow your 
instructions or otherwise make unauthorized changes may be committing a 
tampering violation as described in 40 CFR 1068.105(b).


Sec.  1037.622  Shipment of partially complete vehicles to secondary 
vehicle manufacturers.

    This section specifies how manufacturers may introduce partially 
complete vehicles into U.S. commerce (or in the case of certain custom 
vehicles, introduce complete vehicles into U.S. commerce for 
modification by a small manufacturer). The provisions of this section 
are generally not intended for trailers, but they may apply in unusual 
circumstances, such as when a secondary vehicle manufacturer will 
modify a trailer in a way that makes it exempt. The provisions of this 
section are intended to accommodate normal business practices without 
compromising the effectiveness of certified emission controls. You may 
not use the provisions of this section to circumvent the intent of this 
part. For vehicles subject to both exhaust GHG and evaporative 
standards, the provisions of this part apply separately for each 
certificate.
    (a) The provisions of this section allow manufacturers to ship 
partially complete vehicles to secondary vehicle manufacturers or 
otherwise introduce them into U.S. commerce in the following 
circumstances:
    (1) Certified vehicles. Manufacturers may introduce partially 
complete tractors into U.S. commerce if they are covered by 
certificates of conformity and are in certified configurations. See 
Sec.  1037.621 for vehicles not yet in a certified configuration when 
introduced into U.S. commerce.
    (2) Uncertified vehicles that will be certified by secondary 
vehicle manufacturers. Manufacturers may introduce into U.S. commerce 
partially complete vehicles for which they do not hold the required 
certificate of conformity only as allowed by paragraph (b) of this 
section; however, the requirements of this section do not apply for 
tractors or vocational vehicles with a date of manufacture before 
January 1, 2022, that are produced by a secondary vehicle manufacturer 
if they are excluded from the standards of this part under Sec.  
1037.150(c).
    (3) Exempted vehicles. Manufacturers may introduce into U.S. 
commerce partially complete vehicles without a certificate of 
conformity if the vehicles are exempt under this part or under 40

[[Page 74109]]

CFR part 1068. This may involve the secondary vehicle manufacturer 
qualifying for the exemption.
    (4) Small manufacturers modifying certified tractors. Small 
manufacturers that build custom sleeper cabs or natural gas-fueled 
tractors may modify complete or incomplete vehicles certified as 
tractors, as specified by paragraph (d) of this section.
    (b) The provisions of this paragraph (b) generally apply where the 
secondary vehicle manufacturer has substantial control over the design 
and assembly of emission controls. They also apply where a secondary 
vehicle manufacturer qualifies for a permanent exemption. In unusual 
circumstances we may allow other secondary vehicle manufacturers to use 
these provisions. In determining whether a manufacturer has substantial 
control over the design and assembly of emission controls, we would 
consider the degree to which the secondary vehicle manufacturer would 
be able to ensure that the engine and vehicle will conform to the 
regulations in their final configurations.
    (1) A secondary vehicle manufacturer may finish assembly of 
partially complete vehicles in the following cases:
    (i) It obtains a vehicle that is not fully assembled with the 
intent to manufacture a complete vehicle in a certified or exempted 
configuration. For example, this would apply where a glider vehicle 
assembler holds a certificate that allows the assembler to produce 
certified glider vehicles from glider kits.
    (ii) It obtains a vehicle with the intent to modify it to a 
certified configuration before it reaches the ultimate purchaser. For 
example, this may apply for converting a gasoline-fueled vehicle to 
operate on natural gas under the terms of a valid certificate.
    (2) Manufacturers may introduce partially complete vehicles into 
U.S. commerce as described in this paragraph (b) if they have a written 
request for such vehicles from a secondary vehicle manufacturer that 
will finish the vehicle assembly and has certified the vehicle (or the 
vehicle has been exempted or excluded from the requirements of this 
part). The written request must include a statement that the secondary 
vehicle manufacturer has a certificate of conformity (or exemption/
exclusion) for the vehicle and identify a valid vehicle family name 
associated with each vehicle model ordered (or the basis for an 
exemption/exclusion). The original vehicle manufacturer must apply a 
removable label meeting the requirements of 40 CFR 1068.45(b) that 
identifies the corporate name of the original manufacturer and states 
that the vehicle is exempt under the provisions of Sec.  1037.622. The 
name of the certifying manufacturer must also be on the label or, 
alternatively, on the bill of lading that accompanies the vehicles 
during shipment. The original manufacturer may not apply a permanent 
emission control information label identifying the vehicle's eventual 
status as a certified vehicle. Note that an exemption allowing a glider 
assembler to install an exempt engine does not necessarily exempt the 
vehicle from the requirements of this part.
    (3) If you are the secondary vehicle manufacturer and you will hold 
the certificate, you must include the following information in your 
application for certification:
    (i) Identify the original manufacturer of the partially complete 
vehicle or of the complete vehicle you will modify.
    (ii) Describe briefly how and where final assembly will be 
completed. Specify how you have the ability to ensure that the vehicles 
will conform to the regulations in their final configuration. (Note: 
This section prohibits using the provisions of this paragraph (b) 
unless you have substantial control over the design and assembly of 
emission controls.)
    (iii) State unconditionally that you will not distribute the 
vehicles without conforming to all applicable regulations.
    (4) If you are a secondary vehicle manufacturer and you are already 
a certificate holder for other families, you may receive shipment of 
partially complete vehicles after you apply for a certificate of 
conformity but before the certificate's effective date. This exemption 
allows the original manufacturer to ship vehicles after you have 
applied for a certificate of conformity. Manufacturers may introduce 
partially complete vehicles into U.S. commerce as described in this 
paragraph (b)(4) if they have a written request for such vehicles from 
a secondary vehicle manufacturer stating that the application for 
certification has been submitted (instead of the information we specify 
in paragraph (b)(2) of this section). We may set additional conditions 
under this paragraph (b)(4) to prevent circumvention of regulatory 
requirements.
    (5) The provisions of this section also apply for shipping 
partially complete vehicles if the vehicle is covered by a valid 
exemption and there is no valid family name that could be used to 
represent the vehicle model. Unless we approve otherwise in advance, 
you may do this only when shipping engines to secondary vehicle 
manufacturers that are certificate holders. In this case, the secondary 
vehicle manufacturer must identify the regulatory cite identifying the 
applicable exemption instead of a valid family name when ordering 
engines from the original vehicle manufacturer.
    (6) Both original and secondary vehicle manufacturers must keep the 
records described in this section for at least five years, including 
the written request for exempted vehicles and the bill of lading for 
each shipment (if applicable). The written request is deemed to be a 
submission to EPA.
    (7) These provisions are intended only to allow secondary vehicle 
manufacturers to obtain or transport vehicles in the specific 
circumstances identified in this section so any exemption under this 
section expires when the vehicle reaches the point of final assembly 
identified in paragraph (b)(3)(ii) of this section.
    (8) For purposes of this section, an allowance to introduce 
partially complete vehicles into U.S. commerce includes a conditional 
allowance to sell, introduce, or deliver such vehicles into commerce in 
the United States or import them into the United States. It does not 
include a general allowance to offer such vehicles for sale because 
this exemption is intended to apply only for cases in which the 
certificate holder already has an arrangement to purchase the vehicles 
from the original manufacturer. This exemption does not allow the 
original manufacturer to subsequently offer the vehicles for sale to a 
different manufacturer who will hold the certificate unless that second 
manufacturer has also complied with the requirements of this part. The 
exemption does not apply for any individual vehicles that are not 
labeled as specified in this section or which are shipped to someone 
who is not a certificate holder.
    (9) We may suspend, revoke, or void an exemption under this 
section, as follows:
    (i) We may suspend or revoke your exemption if you fail to meet the 
requirements of this section. We may suspend or revoke an exemption 
related to a specific secondary vehicle manufacturer if that 
manufacturer sells vehicles that are in not in a certified 
configuration in violation of the regulations. We may disallow this 
exemption for future shipments to the affected secondary vehicle 
manufacturer or set additional conditions to ensure that vehicles will 
be assembled in the certified configuration.
    (ii) We may void an exemption for all the affected vehicles if you 
intentionally

[[Page 74110]]

submit false or incomplete information or fail to keep and provide to 
EPA the records required by this section.
    (iii) The exemption is void for a vehicle that is shipped to a 
company that is not a certificate holder or for a vehicle that is 
shipped to a secondary vehicle manufacturer that is not in compliance 
with the requirements of this section.
    (iv) The secondary vehicle manufacturer may be liable for penalties 
for causing a prohibited act where the exemption is voided due to 
actions on the part of the secondary vehicle manufacturer.
    (c) Provide instructions along with partially complete vehicles 
including all information necessary to ensure that an engine will be 
installed in its certified configuration.
    (d) Small manufacturers that build custom sleeper cabs or natural 
gas-fueled tractors may modify complete or incomplete vehicles 
certified as tractors, subject to the provisions of this paragraph (d). 
Such businesses are secondary vehicle manufacturers.
    (1) Secondary vehicle manufacturers may not modify the vehicle body 
in front of the b-pillar or increase the effective frontal area of the 
certified configuration including consideration of the frontal area of 
the standard trailer. For high-roof custom sleeper tractors, this would 
generally mean that no part of the added sleeper compartment may extend 
beyond 102 inches wide or 162 inches high (measured from the ground), 
which are the dimensions of the standard trailer for high-roof tractors 
under this part. Note that these dimensions have a tolerance of 2 inches.
    (2) The certifying manufacturer may have responsibilities for the 
vehicle under this section, as follows:
    (i) If the vehicle being modified is a complete tractor in a 
certified configuration, the certifying manufacturer has no additional 
responsibilities for the vehicle under this section.
    (ii) If the vehicle being modified is partially complete only 
because it lacks body components to the rear of the b-pillar (but is 
otherwise a complete tractor in a certified configuration), the 
certifying manufacturer has no additional responsibilities for the 
vehicle under this section.
    (iii) If the vehicle being modified is an incomplete tractor not in 
a certified configuration, the certifying manufacturer must comply with 
the provisions of Sec.  1037.621 for the vehicle.
    (3) The secondary vehicle manufacturer must add a permanent 
supplemental label to the vehicle near the original manufacturer's 
emission control information label. On the label identify your 
corporate name and include the statement: ``THIS TRACTOR WAS MODIFIED 
UNDER 40 CFR 1037.622.''
    (4) See Sec.  1037.150 for additional interim options that may 
apply.
    (5) The provisions of this paragraph (d) may apply separately for 
vehicle GHG and evaporative emission standards.
    (6) Modifications under this paragraph (d) do not violate 40 CFR 
1068.101(b)(1).


Sec.  1037.630  Special purpose tractors.

    (a) General provisions. This section allows a vehicle manufacturer 
to reclassify certain tractors as vocational tractors. Vocational 
tractors are treated as vocational vehicles and are exempt from the 
standards of Sec.  1037.106. Note that references to ``tractors'' 
outside of this section mean non-vocational tractors.
    (1) This allowance is intended only for vehicles that do not 
typically operate at highway speeds, or would otherwise not benefit 
from efficiency improvements designed for line-haul tractors. This 
allowance is limited to the following vehicle and application types:
    (i) Low-roof tractors intended for intra-city pickup and delivery, 
such as those that deliver bottled beverages to retail stores.
    (ii) Tractors intended for off-road operation (including mixed 
service operation that does not qualify for an exemption under Sec.  
1037.631), such as those with reinforced frames and increased ground 
clearance. This includes drayage tractors.
    (iii) Model year 2020 and earlier tractors with a gross combination 
weight rating (GCWR) at or above 120,000 pounds. Note that Phase 2 
tractors meeting the definition of ``heavy-haul'' in Sec.  1037.801 
must be certified to the heavy-haul standards in Sec. Sec.  1037.106 or 
1037.670.
    (2) Where we determine that a manufacturer is not applying this 
allowance in good faith, we may require the manufacturer to obtain 
preliminary approval before using this allowance.
    (b) Requirements. The following requirements apply with respect to 
tractors reclassified under this section:
    (1) The vehicle must fully conform to all requirements applicable 
to vocational vehicles under this part.
    (2) Vehicles reclassified under this section must be certified as a 
separate vehicle family. However, they remain part of the vocational 
regulatory subcategory and averaging set that applies for their service 
class.
    (3) You must include the following additional statement on the 
vehicle's emission control information label under Sec.  1037.135: 
``THIS VEHICLE WAS CERTIFIED AS A VOCATIONAL TRACTOR UNDER 40 CFR 
1037.630.''
    (4) You must keep records for three years to document your basis 
for believing the vehicles will be used as described in paragraph 
(a)(1) of this section. Include in your application for certification a 
brief description of your basis.
    (c) Production limit. No manufacturer may produce more than 21,000 
Phase 1 vehicles under this section in any consecutive three model year 
period. This means you may not exceed 6,000 in a given model year if 
the combined total for the previous two years was 15,000. The 
production limit applies with respect to all Class 7 and Class 8 Phase 
1 tractors certified or exempted as vocational tractors. No production 
limit applies for tractors subject to Phase 2 standards.
    (d) Off-road exemption. All the provisions of this section apply 
for vocational tractors exempted under Sec.  1037.631, except as 
follows:
    (1) The vehicles are required to comply with the requirements of 
Sec.  1037.631 instead of the requirements that would otherwise apply 
to vocational vehicles. Vehicles complying with the requirements of 
Sec.  1037.631 and using an engine certified to the standards of 40 CFR 
part 1036 are deemed to fully conform to all requirements applicable to 
vocational vehicles under this part.
    (2) The vehicles must be labeled as specified under Sec.  1037.631 
instead of as specified in paragraph (b)(3) of this section.


Sec.  1037.631  Exemption for vocational vehicles intended for off-road 
use.

    This section provides an exemption from the greenhouse gas 
standards of this part for certain vocational vehicles (including 
certain vocational tractors) that are intended to be used extensively 
in off-road environments such as forests, oil fields, and construction 
sites. This section does not exempt engines used in vocational vehicles 
from the standards of 40 CFR part 86 or part 1036. Note that you may 
not include these exempted vehicles in any credit calculations under 
this part.
    (a) Qualifying criteria. Vocational vehicles intended for off-road 
use are exempt without request, subject to the provisions of this 
section, if they are primarily designed to perform work off-road (such 
as in oil fields, mining, forests, or construction sites), and they 
meet at least one of the criteria of

[[Page 74111]]

paragraph (a)(1) of this section and at least one of the criteria of 
paragraph (a)(2) of this section. See Sec.  1037.105(h) for alternate 
Phase 2 standards that apply for vehicles meeting only one of these 
sets of criteria.
    (1) The vehicle must have affixed components designed to work 
inherently in an off-road environment (such as hazardous material 
equipment or off-road drill equipment) or be designed to operate at low 
speeds such that it is unsuitable for normal highway operation.
    (2) The vehicle must meet one of the following criteria:
    (i) Have an axle that has a gross axle weight rating (GAWR) at or 
above 29,000 pounds.
    (ii) Have a speed attainable in 2.0 miles of not more than 33 mi/
hr.
    (iii) Have a speed attainable in 2.0 miles of not more than 45 mi/
hr, an unloaded vehicle weight that is not less than 95 percent of its 
gross vehicle weight rating, and no capacity to carry occupants other 
than the driver and operating crew.
    (iv) Have a maximum speed at or below 54 mi/hr. You may consider 
the vehicle to be appropriately speed-limited if engine speed at 54 mi/
hr is at or above 95 percent of the engine's maximum test speed in the 
highest available gear. You may alternatively limit vehicle speed by 
programming the engine or vehicle's electronic control module in a way 
that is tamper-proof.
    (b) Tractors. The provisions of this section may apply for tractors 
only if each tractor qualifies as a vocational tractor under Sec.  
1037.630.
    (c) Recordkeeping and reporting. (1) You must keep records to 
document that your exempted vehicle configurations meet all applicable 
requirements of this section. Keep these records for at least eight 
years after you stop producing the exempted vehicle model. We may 
review these records at any time.
    (2) You must also keep records of the individual exempted vehicles 
you produce, including the vehicle identification number and a 
description of the vehicle configuration.
    (3) Within 90 days after the end of each model year, you must send 
to the Designated Compliance Officer a report with the following 
information:
    (i) A description of each exempted vehicle configuration, including 
an explanation of why it qualifies for this exemption.
    (ii) The number of vehicles exempted for each vehicle 
configuration.
    (d) Labeling. You must include the following additional statement 
on the vehicle's emission control information label under Sec.  
1037.135: ``THIS VEHICLE WAS EXEMPTED UNDER 40 CFR 1037.631.''


Sec.  1037.635  Glider kits and glider vehicles.

    Except as specified in Sec.  1037.150, the requirements of this 
section apply beginning January 1, 2017.
    (a) Vehicles produced from glider kits and other glider vehicles 
are subject to the same standards as other new vehicles, including the 
applicable vehicle standards described in Subpart B of this part. Note 
that this requirement for the vehicle generally applies even if the 
engine meets the criteria of paragraph (c)(1) of this section. For 
engines originally produced before 2017, if you are unable to obtain a 
fuel map for an engine you may ask to use a default map, consistent 
with good engineering judgment.
    (b) Section 1037.601(a)(1) disallows the introduction into U.S. 
commerce of a new tractor or vocational vehicle (including a vehicle 
assembled from a glider kit) unless it has an engine that is certified 
to the applicable standards in 40 CFR parts 86 and 1036. Except as 
specified otherwise in this part, the standards apply for engines used 
in glider vehicles as follows:
    (1) The engine must meet the GHG standards of 40 CFR part 1036 that 
apply for the engine model year corresponding to the vehicle's date of 
manufacture. For example, for a vehicle with a 2024 date of 
manufacture, the engine must meet the GHG standards that apply for 
model year 2024.
    (2) The engine must meet the criteria pollutant standards of 40 CFR 
part 86 that apply for the engine model year corresponding to the 
vehicle's date of manufacture.
    (3) The engine may be from an earlier model year if the standards 
were identical to the currently applicable engine standards.
    (4) Note that alternate standards or requirements may apply under 
Sec.  1037.150.
    (c) The engine standards identified in paragraph (b) of this 
section do not apply for certain engines when used in glider kits. 
These engines remain subject to the standards to which they were 
previously certified.
    (1) The allowance in this paragraph (c) applies only for following 
engines:
    (i) Certified engines still within their original useful life in 
terms of both miles and years. Glider vehicles produced using engines 
meeting this criterion are exempt from the requirements of paragraph 
(a) of this section if the glider vehicle configuration is identical to 
a configuration previously certified to the requirements of this part 
1037 for a model year the same as or later than the model year of the 
engine.
    (ii) Certified engines of any age with less than 100,000 miles of 
engine operation. This is intended for specialty vehicles (such as fire 
trucks) that have very low usage rates. These vehicles are exempt from 
the requirements of paragraph (a) of this section, provided the 
completed vehicle is returned to the owner of the engine in a 
configuration equivalent to that of the donor vehicle.
    (iii) Certified engines less than three years old with any number 
of accumulated miles of engine operation. Vehicles using these engines 
must comply with the requirements of paragraph (a) of this section.
    (2) For remanufactured engines, these eligibility criteria apply 
based on the original date of manufacture rather than the date of 
remanufacture. For example, an engine originally manufactured in 2003 
that is remanufactured in 2012 after 350,000 miles, then accumulates an 
additional 150,000 miles before being installed in a model year 2020 
glider would be considered to be 17 years old and to have accumulated 
500,000 miles.
    (3) The provisions of this paragraph (c) apply only where you can 
show that one or more criteria have been met. For example, to apply the 
criterion of paragraph (c)(1)(i) or (ii), you must be able prove the 
number of miles the engine has accumulated.
    (d) All engines used in glider vehicles (including remanufactured 
engines) must be in a certified configuration and properly labeled. 
This requirement applies equally to any engine covered by this section. 
Depending on the model year of the engine (and other applicable 
provisions of this section), it may be permissible for the engine to 
remain in its original certified configuration or another configuration 
of the same original model year. However, it may be necessary to modify 
the engine to a newer certified configuration.
    (e) The following additional provisions apply:
    (1) The Clean Air Act definition of ``manufacturer'' includes 
anyone who assembles motor vehicles, including entities that install 
engines in or otherwise complete assembly of glider kits.
    (2) Vehicle manufacturers (including assemblers) producing glider 
vehicles must comply with the reporting and recordkeeping requirements 
in Sec.  1037.250.
    (3) Manufacturers of glider kits providing glider kits for the 
purpose of allowing another manufacturer to assemble vehicles under 
this section are subject to the provisions of Sec. Sec.  1037.620 
through 1037.622, as applicable. For

[[Page 74112]]

example, introducing an uncertified glider kit into U.S. commerce may 
subject you to penalties under 40 CFR 1068.101 if the completed glider 
vehicle does not conform fully with the regulations of the part at any 
point before being placed into service.


Sec.  1037.640  Variable vehicle speed limiters.

    This section specifies provisions that apply for vehicle speed 
limiters (VSLs) that you model under Sec.  1037.520. This does not 
apply for VSLs that you do not model under Sec.  1037.520. (e) This 
section is written to apply for tractors; however, you may use good 
engineering judgment to apply equivalent adjustments for Phase 2 
vocational vehicles with vehicle speed limiters.
    (a) General. The regulations of this part do not constrain how you 
may design VSLs for your vehicles. For example, you may design your VSL 
to have a single fixed speed limit or a soft-top speed limit. You may 
also design your VSL to expire after accumulation of a predetermined 
number of miles. However, designs with soft tops or expiration features 
are subject to proration provisions under this section that do not 
apply to fixed VSLs that do not expire.
    (b) Definitions. The following definitions apply for purposes of 
this section:
    (1) Default speed limit means the speed limit that normally applies 
for the vehicle, except as follows:
    (i) The default speed limit for adjustable VSLs must represent the 
speed limit that applies when the VSL is adjusted to its highest 
setting under paragraph (c) of this section.
    (ii) For VSLs with soft tops, the default speed does not include 
speeds possible only during soft-top operation.
    (iii) For expiring VSLs, the default does not include speeds that 
are possible only after expiration.
    (2) Soft-top speed limit means the highest speed limit that applies 
during soft-top operation.
    (3) Maximum soft-top duration means the maximum amount of time that 
a vehicle could operate above the default speed limit.
    (4) Certified VSL means a VSL configuration that applies when a 
vehicle is new and until it expires.
    (5) Expiration point means the mileage at which a vehicle's 
certified VSL expires (or the point at which tamper protections 
expire).
    (6) Effective speed limit has the meaning given in paragraph (d) of 
this section.
    (c) Adjustments. You may design your VSL to be adjustable; however, 
this may affect the value you use in GEM.
    (1) Except as specified in paragraph (c)(2) of this section, any 
adjustments that can be made to the engine, vehicle, or their controls 
that change the VSL's actual speed limit are considered to be 
adjustable operating parameters. Compliance is based on the vehicle 
being adjusted to the highest speed limit within this range.
    (2) The following adjustments are not adjustable parameters:
    (i) Adjustments made only to account for changing tire size or 
final drive ratio.
    (ii) Adjustments protected by encrypted controls or passwords.
    (iii) Adjustments possible only after the VSL's expiration point.
    (d) Effective speed limit. (1) For VSLs without soft tops or 
expiration points that expire before 1,259,000 miles, the effective 
speed limit is the highest speed limit that results by adjusting the 
VSL or other vehicle parameters consistent with the provisions of 
paragraph (c) of this section.
    (2) For VSLs with soft tops and/or expiration points, the effective 
speed limit is calculated as specified in this paragraph (d)(2), which 
is based on 10 hours of operation per day (394 miles per day for day 
cabs and 551 miles per day for sleeper cabs). Note that this 
calculation assumes that a fraction of this operation is speed-limited 
(3.9 hours and 252 miles for day cabs, and 7.3 hours and 474 miles for 
sleeper cabs). Use the following equation to calculate the effective 
speed limit, rounded to the nearest 0.1 mi/hr:
[GRAPHIC] [TIFF OMITTED] TR25OC16.152

Where:

ExF = expiration point miles/1,259,000 miles.
STF = the maximum number of allowable soft top operation hours per 
day/3.9 hours for day cabs (or maximum miles per day/252), or the 
maximum number of allowable soft top operation hours per day/7.3 
hours for sleeper cabs (or maximum miles per day/474).
STSL = the soft-top speed limit.
DSL = the default speed limit.


Sec.  1037.645  In-use compliance with family emission limits (FELs).

    Section 1037.225 describes how to change the FEL for a vehicle 
family during the model year. This section, which describes how you may 
ask us to increase a vehicle family's FEL after the end of the model 
year, is intended to address circumstances in which it is in the public 
interest to apply a higher in-use FEL based on forfeiting an 
appropriate number of emission credits. For example, this may be 
appropriate where we determine that recalling vehicles would not 
significantly reduce in-use emissions. We will generally not allow this 
option where we determine the credits being forfeited would likely have 
expired.
    (a) You may ask us to increase a vehicle family's FEL after the end 
of the model year if you believe some of your in-use vehicles exceed 
the CO2 FEL that applied during the model year (or the 
CO2 emission standard if the family did not generate or use 
emission credits). We may consider any available information in making 
our decision to approve or deny your request.
    (b) If we approve your request under this section, you must apply 
emission credits to cover the increased FEL for all affected vehicles. 
Apply the emission credits as part of your credit demonstration for the 
current production year. Include the appropriate calculations in your 
final report under Sec.  1037.730.
    (c) Submit your request to the Designated Compliance Officer. 
Include the following in your request:
    (1) Identify the names of each vehicle family that is the subject 
of your request. Include separate family names for different model 
years
    (2) Describe why your request does not apply for similar vehicle 
models or additional model years, as applicable.
    (3) Identify the FEL that applied during the model year for each 
configuration and recommend replacement FELs for in-use vehicles; 
include a supporting rationale to describe how you determined the 
recommended replacement FELs.
    (4) Describe whether the needed emission credits will come from 
averaging, banking, or trading.
    (d) If we approve your request, we will identify one or more 
replacement FELs, as follows:
    (1) Where your vehicle family includes more than one sub-family 
with

[[Page 74113]]

different FELs, we may apply a higher FEL within the family than was 
applied to the vehicle's configuration in your final ABT report. For 
example, if your vehicle family included three sub-families, with FELs 
of 200 g/ton-mile, 210 g/ton-mile, and 220 g/ton-mile, we may apply a 
220 g/ton-mile in-use FEL to vehicles that were originally designated 
as part of the 200 g/ton-mile or 210 g/ton-mile sub-families.
    (2) Without regard to the number of sub-families in your certified 
vehicle family, we may specify one or more new sub-families with higher 
FELs than you included in your final ABT report. We may apply these 
higher FELs as in-use FELs for your vehicles. For example, if your 
vehicle family included three sub-families, with FELs of 200 g/ton-
mile, 210 g/ton-mile, and 220 g/ton-mile, we may specify a new 230 g/
ton-mile sub-family.
    (3) Our selected values for the replacement FEL will reflect our 
best judgment to accurately reflect the actual in-use performance of 
your vehicles, consistent with the testing provisions specified in this 
part.
    (4) We may apply the higher FELs to other vehicle families from the 
same or different model years to the extent they used equivalent 
emission controls. We may include any appropriate conditions with our 
approval.
    (e) If we order a recall for a vehicle family under 40 CFR 
1068.505, we will no longer approve a replacement FEL under this 
section for any of your vehicles from that vehicle family, or from any 
other vehicle family that relies on equivalent emission controls.


Sec.  1037.655  Post-useful life vehicle modifications.

    (a) General. Vehicle modifications during and after the useful life 
are presumed to violate 42 U.S.C. 7522(a)(3)(A) if they involve 
removing or rendering inoperative any emission control device installed 
to comply with the requirements of this part 1037. This section 
specifies vehicle modifications that may occur in certain circumstances 
after a vehicle reaches the end of its regulatory useful life. EPA may 
require a higher burden of proof with respect to modifications that 
occur within the useful life period, and the specific examples 
presented here do not necessarily apply within the useful life. This 
section also does not apply with respect to engine modifications or 
recalibrations.
    (b) Allowable modifications. You may modify a vehicle for the 
purpose of reducing emissions, provided you have a reasonable technical 
basis for knowing that such modification will not increase emissions of 
any other pollutant. ``Reasonable technical basis'' has the meaning 
given in 40 CFR 1068.30. This generally requires you to have 
information that would lead an engineer or other person familiar with 
engine and vehicle design and function to reasonably believe that the 
modifications will not increase emissions of any regulated pollutant.
    (c) Examples of allowable modifications. The following are examples 
of allowable modifications:
    (1) It is generally allowable to remove tractor roof fairings after 
the end of the vehicle's useful life if the vehicle will no longer be 
used primarily to pull box vans.
    (2) Other fairings may be removed after the end of the vehicle's 
useful life if the vehicle will no longer be used significantly on 
highways with a vehicle speed of 55 miles per hour or higher.
    (d) Examples of prohibited modifications. The following are 
examples of modifications that are not allowable:
    (1) No person may disable a vehicle speed limiter prior to its 
expiration point.
    (2) No person may remove aerodynamic fairings from tractors that 
are used primarily to pull box vans on highways.


Sec.  1037.660  Idle-reduction technologies.

    This section specifies requirements that apply for idle-reduction 
technologies modeled under Sec.  1037.520. It does not apply for idle-
reduction technologies you do not model under Sec.  1037.520.
    (a) Minimum requirements. Idle-reduction technologies must meet all 
the following requirements to be modeled under Sec.  1037.520 except as 
specified in paragraphs (b) and (c) of this section:
    (1) Automatic engine shutdown (AES) systems. The system must shut 
down the engine within a threshold inactivity period of 60 seconds or 
less for vocational vehicles and 300 seconds or less for tractors when 
all the following conditions are met:
    (i) The transmission is set to park, or the transmission is in 
neutral with the parking brake engaged. This is ``parked idle.''
    (ii) The operator has not reset the system timer within the 
specified threshold inactivity period by changing the position of the 
accelerator, brake, or clutch pedal; or by resetting the system timer 
with some other mechanism we approve.
    (iii)You may identify systems as ``tamper-resistant'' if you make 
no provision for vehicle owners, dealers, or other service outlets to 
adjust the threshold inactivity period.
    (iv) For Phase 2 tractors, you may identify AES systems as 
``adjustable'' if, before delivering to the ultimate purchaser, you 
enable authorized dealers to modify the vehicle in a way that disables 
the AES system or makes the threshold inactivity period longer than 300 
seconds. However, the vehicle may not be delivered to the ultimate 
purchaser with the AES system disabled or the threshold inactivity 
period set longer than 300 seconds. You may allow dealers or repair 
facilities to make such modifications; this might involve password 
protection for electronic controls, or special tools that only you 
provide. Any dealers making any modifications before delivery to the 
ultimate purchaser must notify you, and you must account for such 
modifications in your production and ABT reports after the end of the 
model year. Dealers failing to provide prompt notification are in 
violation of the tampering prohibition of 40 CFR 1068.101(b)(1). Dealer 
notifications are deemed to be submissions to EPA. Note that these 
adjustments may not be made if the AES system was not ``adjustable'' 
when first delivered to the ultimate purchaser.
    (v) For vocational vehicles, you may use the provisions of Sec.  
1037.610 to apply for an appropriate partial emission reduction for AES 
systems you identify as ``adjustable.''
    (2) Neutral idle. Phase 2 vehicles with hydrokinetic torque 
converters paired with automatic transmissions qualify for neutral-idle 
credit in GEM modeling if the transmission reduces torque equivalent to 
shifting into neutral throughout the interval during which the 
vehicle's brake pedal is depressed and the vehicle is at a zero-speed 
condition. If a vehicle reduces torque partially but not enough to be 
equivalent to shifting to neutral, you may use the provisions of Sec.  
1037.610(g) to apply for an appropriate partial emission reduction; 
this may involve A to B testing with the powertrain test procedure in 
Sec.  1037.550 or the spin-loss portion of the transmission efficiency 
test in Sec.  1037.565.
    (3) Stop-start. Phase 2 vocational vehicles qualify for stop-start 
reduction in GEM modeling if the engine shuts down no more than 5 
seconds after the vehicle's brake pedal is depressed when the vehicle 
is at a zero-speed condition.
    (b) Override conditions. The system may limit activation of the 
idle-reduction technology while any of the conditions of this paragraph 
(b) apply. These conditions allow the system to delay engine shutdown, 
adjust engine

[[Page 74114]]

restarting, or delay disengaging transmissions, but do not allow for 
resetting timers. Engines may restart and transmissions may re-engage 
during override conditions if the vehicle is set up to do this 
automatically. We may approve additional override criteria as needed to 
protect the engine and vehicle from damage and to ensure safe vehicle 
operation.
    (1) For AES systems on tractors, the system may delay shutdown--
    (i) While an exhaust emission control device is regenerating. The 
period considered to be regeneration for purposes of this allowance 
must be consistent with good engineering judgment and may differ in 
length from the period considered to be regeneration for other 
purposes. For example, in some cases it may be appropriate to include a 
cool down period for this purpose but not for infrequent regeneration 
adjustment factors.
    (ii) If necessary while servicing the vehicle, provided the 
deactivation of the AES system is accomplished using a diagnostic scan 
tool. The system must be automatically reactivated when the engine is 
shut down for more than 60 minutes.
    (iii) If the vehicle's main battery state-of-charge is not 
sufficient to allow the main engine to be restarted.
    (iv) If the vehicle's transmission, fuel, oil, or engine coolant 
temperature is too low or too high according to the manufacturer's 
specifications for protecting against system damage. This allows the 
engine to continue operating until it is in a predefined temperature 
range, within which the shutdown sequence of paragraph (a) of this 
section would resume.
    (v) While the vehicle's main engine is operating in power take-off 
(PTO) mode. For purposes of this paragraph (b), an engine is considered 
to be in PTO mode when a switch or setting designating PTO mode is 
enabled.
    (vi) If external ambient conditions prevent managing cabin 
temperatures for the driver's safety.
    (2) For AES systems on vocational vehicles, the system may limit 
activation--
    (i) If any condition specified in paragraphs (b)(1)(i) through (vi) 
of this section applies.
    (ii) If internal cab temperatures are too hot or too cold for the 
driver's safety.
    (3) For neutral idle, the system may delay shifting the 
transmission to neutral--
    (i) For the PTO conditions specified in paragraph (b)(1)(v) of this 
section.
    (ii) [Reserved]
    (4) For stop-start, the system may limit activation--
    (i) For any of the conditions specified in paragraphs (b)(2) or 
(b)(3)(ii) of this section.
    (ii) When air brake pressure is too low according to the 
manufacturer's specifications for maintaining vehicle-braking 
capability.
    (iii) When the transmission is in reverse gear.
    (iv) When recent vehicle speeds indicate an abnormally high 
shutdown and restart frequency, such as with congested driving. For 
example, a vehicle not exceeding 10 mi/hr for the previous 300 seconds 
or since the most recent engine start would be a proper basis for 
overriding engine shutdown. You may also design this override to 
protect against system damage or malfunction of safety systems.
    (v) When the vehicle detects that a system or component is worn or 
malfunctioning in a way that could reasonably prevent the engine from 
restarting, such as low battery voltage.
    (c) Adjustments to AES systems for Phase 1. (1) The AES system may 
include an expiration point (in miles) after which the AES system may 
be disabled. If your vehicle is equipped with an AES system that 
expires before 1,259,000 miles, adjust the model input as follows, 
rounded to the nearest 0.1 g/ton-mile: AES Input = 5 g CO2/
ton-mile x (miles at expiration/1,259,000 miles).
    (2) For AES systems designed to limit idling to a specific number 
of hours less than 1,800 hours over any 12-month period, calculate an 
adjusted AES input using the following equation, rounded to the nearest 
0.1 g/ton-mile: AES Input = 5 g CO2/ton-mile x (1--(maximum 
allowable number of idling hours per year/1,800 hours)). This is an 
annual allowance that starts when the vehicle is new and resets every 
12 months after that. Manufacturers may propose an alternate method 
based on operating hours or miles instead of years.
    (d) Adjustable parameters. Provisions that apply generally with 
respect to adjustable parameters also apply to the AES system operating 
parameters, except the following are not considered to be adjustable 
parameters:
    (1) Accelerator, brake, and clutch pedals, with respect to 
resetting the idle timer. Parameters associated with other timer reset 
mechanisms we approve are also not adjustable parameters.
    (2) Bypass parameters allowed for vehicle service under paragraph 
(b)(1)(ii) of this section.
    (3) Parameters that are adjustable only after the expiration point.
    (e) PM limit for diesel APU. For model year 2020 and earlier 
tractors with a date of manufacture on or after January 1, 2018, the 
GEM credit for AES systems with OEM-installed diesel APUs is valid only 
if the engine is certified under 40 CFR part 1039 with a deteriorated 
emission level for particulate matter at or below 0.15 g/kW-hr, or if 
the engine or APU is certified to the standards specified in Sec.  
1037.106(g).


Sec.  1037.665  Production and in-use tractor testing.

    Manufacturers with annual U.S.-directed production volumes of 
greater than 20,000 tractors must perform testing as described in this 
section. Tractors may be new or used.
    (a) The following test requirements apply for model years 2021 and 
later:
    (1) Each calendar year, select for testing three sleeper cabs and 
two day cabs certified to Phase 1 or Phase 2 standards. If we do not 
identify certain vehicle configurations for your testing, select models 
that you project to be among your 12 highest-selling vehicle 
configurations for the given year.
    (2) Set up the tractors on a chassis dynamometer and operate them 
over all applicable duty cycles from Sec.  1037.510(a). You may use 
emission-measurement systems meeting the specifications of 40 CFR part 
1065, subpart J. Calculate coefficients for the road-load force 
equation as described in Section 10 of SAE J1263 or Section 11 of SAE 
J2263 (both incorporated by reference in Sec.  1037.810). Use standard 
payload. Measure emissions of NOX, PM, CO, NMHC, 
CO2, CH4, and N2O. Determine emission 
levels in g/hour for the idle test and g/ton-mile for other duty 
cycles.
    (b) Send us an annual report with your test results for each duty 
cycle and the corresponding GEM results. Send the report by the next 
October 1 after the year we select the vehicles for testing, or a later 
date that we approve. We may make your test data publicly available.
    (c) We may approve your request to perform alternative testing that 
will provide equivalent or better information compared to the specified 
testing. We may also direct you to do less testing than we specify in 
this section.
    (d) GHG standards do not apply with respect to testing under this 
section. Note however that NTE standards apply for any qualifying 
operation that occurs during the testing in the same way that it would 
during any other in-use testing.


Sec.  1037.670  Optional CO2 emission standards for tractors 
at or above 120,000 pounds GCWR.

    (a) You may certify tractors at or above 120,000 pounds GCWR to the 
following CO2 standards instead of the CO2 
standards of Sec.  1037.106:

[[Page 74115]]



  Table 1 of Sec.   1037.670--Optional CO2 Standards for Tractors Above
                    120,000 Pounds GCWR by Model Year
                              [g/ton-mile]
------------------------------------------------------------------------
                                                               Phase 2
                                                              standards
                        Subcategory                           for model
                                                              years 2021
                                                              and later
------------------------------------------------------------------------
Heavy Class 8 Low-Roof Day Cab.............................         51.8
Heavy Class 8 Low-Roof Sleeper Cab.........................         45.3
Heavy Class 8 Mid-Roof Day Cab.............................         54.1
Heavy Class 8 Mid-Roof Sleeper Cab.........................         47.9
Heavy Class 8 High-Roof Day Cab............................         54.1
Heavy Class 8 High-Roof Sleeper Cab........................         46.9
------------------------------------------------------------------------

    (b) Determine subcategories as described in Sec.  1037.230 for 
tractors that are not heavy-haul tractors. For example, the subcategory 
for tractors that would otherwise be considered Class 8 low-roof day 
cabs would be Heavy Class 8 Low-Roof Day Cabs.
    (c) Except for the CO2 standards of Sec.  1037.106, all 
provisions applicable to tractors under this part continue to apply to 
tractors certified to the standards of this section. Include the 
following compliance statement on your label instead of the statement 
specified in Sec.  1037.135(c)(8): ``THIS VEHICLE COMPLIES WITH U.S. 
EPA REGULATIONS FOR [MODEL YEAR] HEAVY-DUTY VEHICLES UNDER 40 CFR 
1037.670.''
    (d) The optional emission standards in this section are intended 
primarily for tractors that will be exported; however, you may include 
any tractors certified under this section in your emission credit 
calculation under Sec.  1037.705 if they are part of your U.S.-directed 
production volume.

Subpart H--Averaging, Banking, and Trading for Certification


Sec.  1037.701  General provisions.

    (a) You may average, bank, and trade emission credits for purposes 
of certification as described in this subpart and in subpart B of this 
part to show compliance with the standards of Sec. Sec.  1037.105 
through 1037.107. Note that Sec. Sec.  1037.105(h) and 1037.107 specify 
standards involving limited or no use of emission credits under this 
subpart. Participation in this program is voluntary.
    (b) The definitions of subpart I of this part apply to this subpart 
in addition to the following definitions:
    (1) Actual emission credits means emission credits you have 
generated that we have verified by reviewing your final report.
    (2) Averaging set means a set of vehicles in which emission credits 
may be exchanged. Note that an averaging set may comprise more than one 
regulatory subcategory. See Sec.  1037.740.
    (3) Broker means any entity that facilitates a trade of emission 
credits between a buyer and seller.
    (4) Buyer means the entity that receives emission credits as a 
result of a trade.
    (5) Reserved emission credits means emission credits you have 
generated that we have not yet verified by reviewing your final report.
    (6) Seller means the entity that provides emission credits during a 
trade.
    (7) Standard means the emission standard that applies under subpart 
B of this part for vehicles not participating in the ABT program of 
this subpart.
    (8) Trade means to exchange emission credits, either as a buyer or 
seller.
    (c) Emission credits may be exchanged only within an averaging set, 
except as specified in Sec.  1037.740.
    (d) You may not use emission credits generated under this subpart 
to offset any emissions that exceed an FEL or standard, except as 
allowed by Sec.  1037.645.
    (e) You may use either of the following approaches to retire or 
forego emission credits:
    (1) You may trade emission credits generated from any number of 
your vehicles to the vehicle purchasers or other parties to retire the 
credits. Identify any such credits in the reports described in Sec.  
1037.730. Vehicles must comply with the applicable FELs even if you 
donate or sell the corresponding emission credits under this paragraph 
(e). Those credits may no longer be used by anyone to demonstrate 
compliance with any EPA emission standards.
    (2) You may certify a family using an FEL below the emission 
standard as described in this part and choose not to generate emission 
credits for that family. If you do this, you do not need to calculate 
emission credits for those families and you do not need to submit or 
keep the associated records described in this subpart for that family.
    (f) Emission credits may be used in the model year they are 
generated. Where we allow it, surplus emission credits may be banked 
for future model years. Surplus emission credits may sometimes be used 
for past model years, as described in Sec.  1037.745.
    (g) You may increase or decrease an FEL during the model year by 
amending your application for certification under Sec.  1037.225. The 
new FEL may apply only to vehicles you have not already introduced into 
commerce.
    (h) See Sec.  1037.740 for special credit provisions that apply for 
credits generated under 40 CFR 86.1819(k)(7), 40 CFR 1036.615, or Sec.  
1037.615.
    (i) Unless the regulations explicitly allow it, you may not 
calculate credits more than once for any emission reduction. For 
example, if you generate CO2 emission credits for a given 
hybrid vehicle under this part, no one may generate CO2 
emission credits for the hybrid engine under 40 CFR part 1036. However, 
credits could be generated for identical engine used in vehicles that 
did not generate credits under this part.
    (j) You may use emission credits generated under the Phase 1 
standards when certifying vehicles to Phase 2 standards. No credit 
adjustments are required other than corrections for different useful 
lives.


Sec.  1037.705  Generating and calculating emission credits.

    (a) The provisions of this section apply separately for calculating 
emission credits for each pollutant.
    (b) For each participating family or subfamily, calculate positive 
or negative emission credits relative to the otherwise applicable 
emission standard. Calculate positive emission credits for a family or 
subfamily that has an FEL below the standard. Calculate negative 
emission credits for a family or subfamily that has an FEL above the 
standard. Sum your positive and negative credits for the model year 
before rounding. Round the sum of emission credits to the nearest 
megagram (Mg), using consistent units with the following equation:

Emission credits (Mg) = (Std-FEL) [middot] (PL) [middot] (Volume) 
[middot] (UL) [middot] (10-6)

Where:

Std = the emission standard associated with the specific regulatory 
subcategory (g/ton-mile).
FEL = the family emission limit for the vehicle subfamily (g/ton-
mile).
PL = standard payload, in tons.
Volume = U.S.-directed production volume of the vehicle subfamily. 
For example, if you produce three configurations with the same FEL, 
the subfamily production volume would be the sum of the production 
volumes for these three configurations.
UL = useful life of the vehicle, in miles, as described in Sec.  
1037.105 and Sec.  1037.106. Use 250,000 miles for trailers.

    (c) As described in Sec.  1037.730, compliance with the 
requirements of this subpart is determined at the end of the model year 
based on actual U.S.-

[[Page 74116]]

directed production volumes. Keep appropriate records to document these 
production volumes. Do not include any of the following vehicles to 
calculate emission credits:
    (1) Vehicles that you do not certify to the CO2 
standards of this part because they are permanently exempted under 
subpart G of this part or under 40 CFR part 1068.
    (2) Exported vehicles.
    (3) Vehicles not subject to the requirements of this part, such as 
those excluded under Sec.  1037.5.
    (4) Any other vehicles, where we indicate elsewhere in this part 
1037 that they are not to be included in the calculations of this 
subpart.


Sec.  1037.710  Averaging.

    (a) Averaging is the exchange of emission credits among your 
vehicle families. You may average emission credits only within the same 
averaging set, except as specified in Sec.  1037.740.
    (b) You may certify one or more vehicle families (or subfamilies) 
to an FEL above the applicable standard, subject to any applicable FEL 
caps and other provisions in subpart B of this part, if you show in 
your application for certification that your projected balance of all 
emission-credit transactions in that model year is greater than or 
equal to zero or that a negative balance is allowed under Sec.  
1037.745.
    (c) If you certify a vehicle family to an FEL that exceeds the 
otherwise applicable standard, you must obtain enough emission credits 
to offset the vehicle family's deficit by the due date for the final 
report required in Sec.  1037.730. The emission credits used to address 
the deficit may come from your other vehicle families that generate 
emission credits in the same model year (or from later model years as 
specified in Sec.  1037.745), from emission credits you have banked 
from previous model years, or from emission credits generated in the 
same or previous model years that you obtained through trading. Note 
that the option for using banked or traded credits does not apply for 
trailers.


Sec.  1037.715  Banking.

    (a) Banking is the retention of surplus emission credits by the 
manufacturer generating the emission credits for use in future model 
years for averaging or trading. Note that Sec.  1037.107 does not allow 
banking for trailers.
    (b) You may designate any emission credits you plan to bank in the 
reports you submit under Sec.  1037.730 as reserved credits. During the 
model year and before the due date for the final report, you may 
designate your reserved emission credits for averaging or trading.
    (c) Reserved credits become actual emission credits when you submit 
your final report. However, we may revoke these emission credits if we 
are unable to verify them after reviewing your reports or auditing your 
records.
    (d) Banked credits retain the designation of the averaging set in 
which they were generated.


Sec.  1037.720  Trading.

    (a) Trading is the exchange of emission credits between 
manufacturers, or the transfer of credits to another party to retire 
them. You may use traded emission credits for averaging, banking, or 
further trading transactions. Traded emission credits remain subject to 
the averaging-set restrictions based on the averaging set in which they 
were generated. Note that Sec.  1037.107 does not allow trading for 
trailers.
    (b) You may trade actual emission credits as described in this 
subpart. You may also trade reserved emission credits, but we may 
revoke these emission credits based on our review of your records or 
reports or those of the company with which you traded emission credits. 
You may trade banked credits within an averaging set to any certifying 
manufacturer.
    (c) If a negative emission credit balance results from a 
transaction, both the buyer and seller are liable, except in cases we 
deem to involve fraud. See Sec.  1037.255(e) for cases involving fraud. 
We may void the certificates of all vehicle families participating in a 
trade that results in a manufacturer having a negative balance of 
emission credits. See Sec.  1037.745.


Sec.  1037.725  What must I include in my application for 
certification?

    (a) You must declare in your application for certification your 
intent to use the provisions of this subpart for each vehicle family 
that will be certified using the ABT program. You must also declare the 
FELs you select for the vehicle family or subfamily for each pollutant 
for which you are using the ABT program. Your FELs must comply with the 
specifications of subpart B of this part, including the FEL caps. FELs 
must be expressed to the same number of decimal places as the 
applicable standards.
    (b) Include the following in your application for certification:
    (1) A statement that, to the best of your belief, you will not have 
a negative balance of emission credits for any averaging set when all 
emission credits are calculated at the end of the year; or a statement 
that you will have a negative balance of emission credits for one or 
more averaging sets but that it is allowed under Sec.  1037.745.
    (2) Calculations of projected emission credits (positive or 
negative) based on projected U.S.-directed production volumes. We may 
require you to include similar calculations from your other vehicle 
families to project your net credit balances for the model year. If you 
project negative emission credits for a family or subfamily, state the 
source of positive emission credits you expect to use to offset the 
negative emission credits.


Sec.  1037.730  ABT reports.

    (a) If any of your engine families are certified using the ABT 
provisions of this subpart, you must send an end-of-year report by 
March 31 following the end of the model year and a final report by 
September 30 following the end of the model year. We may waive the 
requirement to send an end-of-year report.
    (b) Your end-of-year and final reports must include the following 
information for each vehicle family participating in the ABT program:
    (1) Vehicle-family and subfamily designations, and averaging set.
    (2) The regulatory subcategory and emission standards that would 
otherwise apply to the vehicle family.
    (3) The FEL for each pollutant. If you change the FEL after the 
start of production, identify the date that you started using the new 
FEL and/or give the vehicle identification number for the first vehicle 
covered by the new FEL. In this case, identify each applicable FEL and 
calculate the positive or negative emission credits as specified in 
Sec.  1037.225.
    (4) The projected and actual U.S.-directed production volumes for 
the model year. If you changed an FEL during the model year, identify 
the actual U.S.-directed production volume associated with each FEL.
    (5) Useful life.
    (6) Calculated positive or negative emission credits for the whole 
vehicle family. Identify any emission credits that you traded, as 
described in paragraph (d)(1) of this section.
    (7) If you have a negative credit balance for the averaging set in 
the given model year, specify whether the vehicle family (or certain 
subfamilies with the vehicle family) have a credit deficit for the 
year. Consider for example, a manufacturer with three vehicle families 
(``A'', ``B'', and ``C'') in a given averaging set. If family A 
generates enough credits to offset the negative credits of family B but 
not

[[Page 74117]]

enough to also offset the negative credits of family C (and the 
manufacturer has no banked credits in the averaging set), the 
manufacturer may designate families A and B as having no deficit for 
the model year, provided it designates family C as having a deficit for 
the model year.
    (c) Your end-of-year and final reports must include the following 
additional information:
    (1) Show that your net balance of emission credits from all your 
participating vehicle families in each averaging set in the applicable 
model year is not negative, except as allowed under Sec.  1037.745. 
Your credit tracking must account for the limitation on credit life 
under Sec.  1037.740(c).
    (2) State whether you will retain any emission credits for banking. 
If you choose to retire emission credits that would otherwise be 
eligible for banking, identify the families that generated the emission 
credits, including the number of emission credits from each family.
    (3) State that the report's contents are accurate.
    (4) Identify the technologies that make up the certified 
configuration associated with each vehicle identification number. You 
may identify this as a range of identification numbers for vehicles 
involving a single, identical certified configuration.
    (d) If you trade emission credits, you must send us a report within 
90 days after the transaction, as follows:
    (1) As the seller, you must include the following information in 
your report:
    (i) The corporate names of the buyer and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) The averaging set corresponding to the vehicle families that 
generated emission credits for the trade, including the number of 
emission credits from each averaging set.
    (2) As the buyer, you must include the following information in 
your report:
    (i) The corporate names of the seller and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) How you intend to use the emission credits, including the 
number of emission credits you intend to apply for each averaging set.
    (e) Send your reports electronically to the Designated Compliance 
Officer using an approved information format. If you want to use a 
different format, send us a written request with justification for a 
waiver.
    (f) Correct errors in your end-of-year or final report as follows:
    (1) You may correct any errors in your end-of-year report when you 
prepare the final report, as long as you send us the final report by 
the time it is due.
    (2) If you or we determine within 270 days after the end of the 
model year that errors mistakenly decreased your balance of emission 
credits, you may correct the errors and recalculate the balance of 
emission credits. You may not make these corrections for errors that 
are determined more than 270 days after the end of the model year. If 
you report a negative balance of emission credits, we may disallow 
corrections under this paragraph (f)(2).
    (3) If you or we determine any time that errors mistakenly 
increased your balance of emission credits, you must correct the errors 
and recalculate the balance of emission credits.


Sec.  1037.735  Recordkeeping.

    (a) You must organize and maintain your records as described in 
this section.
    (b) Keep the records required by this section for at least eight 
years after the due date for the end-of-year report. You may not use 
emission credits for any vehicles if you do not keep all the records 
required under this section. You must therefore keep these records to 
continue to bank valid credits.
    (c) Keep a copy of the reports we require in Sec. Sec.  1037.725 
and 1037.730.
    (d) Keep records of the vehicle identification number for each 
vehicle you produce. You may identify these numbers as a range. If you 
change the FEL after the start of production, identify the date you 
started using each FEL and the range of vehicle identification numbers 
associated with each FEL. You must also identify the purchaser and 
destination for each vehicle you produce to the extent this information 
is available.
    (e) We may require you to keep additional records or to send us 
relevant information not required by this section in accordance with 
the Clean Air Act.


Sec.  1037.740  Restrictions for using emission credits.

    The following restrictions apply for using emission credits:
    (a) Averaging sets. Except as specified in paragraph (b) of this 
section, emission credits may be exchanged only within an averaging 
set. The following principal averaging sets apply for vehicles 
certified to the standards of this part involving emission credits as 
described in this subpart:
    (1) Light HDV.
    (2) Medium HDV.
    (3) Heavy HDV.
    (4) Long trailers.
    (5) Short trailers.
    (6) Note that other separate averaging sets also apply for emission 
credits not related to this part. For example, vehicles certified to 
the greenhouse gas standards of 40 CFR 86.1819 comprise a single 
averaging set. Separate averaging sets also apply for engines under 40 
CFR part 1036, including engines used in vehicles subject to this 
subpart.
    (b) Credits from hybrid vehicles and other advanced technologies. 
Credits you generate under Sec.  1037.615 from Phase 1 vehicles may be 
used for any of the averaging sets identified in paragraph (a) of this 
section; you may also use those credits to demonstrate compliance with 
the CO2 emission standards in 40 CFR 86.1819 and 40 CFR part 
1036. Similarly, you may use advanced-technology credits generated 
under 40 CFR 86.1819-14(k)(7) or 40 CFR 1036.615 to demonstrate 
compliance with the CO2 standards in this part. Credits 
generated from Phase 2 vehicles are subject to all the averaging-set 
restrictions that apply to other emission credits.
    (1) The maximum amount of credits you may bring into the following 
service class groups is 60,000 Mg per model year:
    (i) Spark-ignition engines, light heavy-duty compression-ignition 
engines, and light heavy-duty vehicles. This group comprises the 
averaging set listed in paragraphs (a)(1) of this section and the 
averaging set listed in 40 CFR 1036.740(a)(1) and (2).
    (ii) Medium heavy-duty compression-ignition engines and medium 
heavy-duty vehicles. This group comprises the averaging sets listed in 
paragraph (a)(2) of this section and 40 CFR 1036.740(a)(3).
    (iii) Heavy heavy-duty compression-ignition engines and heavy 
heavy-duty vehicles. This group comprises the averaging sets listed in 
paragraph (a)(3) of this section and 40 CFR 1036.740(a)(4).
    (2) Paragraph (b)(1) of this section does not limit the advanced-
technology credits that can be used within a service class group if 
they were generated in that same service class group.
    (c) Credit life. Banked credits may be used only for five model 
years after the year in which they are generated. For example, credits 
you generate in model year 2018 may be used to demonstrate compliance 
with emission standards only through model year 2023.
    (d) Other restrictions. Other sections of this part specify 
additional restrictions for using emission credits under certain 
special provisions.


Sec.  1037.745  End-of-year CO[bdi2] credit deficits.

    Except as allowed by this section, we may void the certificate of 
any vehicle

[[Page 74118]]

family certified to an FEL above the applicable standard for which you 
do not have sufficient credits by the deadline for submitting the final 
report.
    (a) Your certificate for a vehicle family for which you do not have 
sufficient CO2 credits will not be void if you remedy the 
deficit with surplus credits within three model years (this applies 
equally for tractors, trailers, and vocational vehicles). For example, 
if you have a credit deficit of 500 Mg for a vehicle family at the end 
of model year 2015, you must generate (or otherwise obtain) a surplus 
of at least 500 Mg in that same averaging set by the end of model year 
2018.
    (b) You may not bank or trade away CO2 credits in the 
averaging set in any model year in which you have a deficit.
    (c) You may apply only surplus credits to your deficit. You may not 
apply credits to a deficit from an earlier model year if they were 
generated in a model year for which any of your vehicle families for 
that averaging set had an end-of-year credit deficit.
    (d) You must notify us in writing how you plan to eliminate the 
credit deficit within the specified time frame. If we determine that 
your plan is unreasonable or unrealistic, we may deny an application 
for certification for a vehicle family if its FEL would increase your 
credit deficit. We may determine that your plan is unreasonable or 
unrealistic based on a consideration of past and projected use of 
specific technologies, the historical sales mix of your vehicle models, 
your commitment to limit production of higher-emission vehicles, and 
expected access to traded credits. We may also consider your plan 
unreasonable if your credit deficit increases from one model year to 
the next. We may require that you send us interim reports describing 
your progress toward resolving your credit deficit over the course of a 
model year.
    (e) If you do not remedy the deficit with surplus credits within 
three model years, we may void your certificate for that vehicle 
family. Note that voiding a certificate applies ab initio. Where the 
net deficit is less than the total amount of negative credits 
originally generated by the family, we will void the certificate only 
with respect to the number of vehicles needed to reach the amount of 
the net deficit. For example, if the original vehicle family generated 
500 Mg of negative credits, and the manufacturer's net deficit after 
three years was 250 Mg, we would void the certificate with respect to 
half of the vehicles in the family.
    (f) For purposes of calculating the statute of limitations, the 
following actions are all considered to occur at the expiration of the 
deadline for offsetting a deficit as specified in paragraph (a) of this 
section:
    (1) Failing to meet the requirements of paragraph (a) of this 
section.
    (2) Failing to satisfy the conditions upon which a certificate was 
issued relative to offsetting a deficit.
    (3) Selling, offering for sale, introducing or delivering into U.S. 
commerce, or importing vehicles that are found not to be covered by a 
certificate as a result of failing to offset a deficit.


Sec.  1037.750  What can happen if I do not comply with the provisions 
of this subpart?

    (a) For each vehicle family participating in the ABT program, the 
certificate of conformity is conditioned upon full compliance with the 
provisions of this subpart during and after the model year. You are 
responsible to establish to our satisfaction that you fully comply with 
applicable requirements. We may void the certificate of conformity for 
a vehicle family if you fail to comply with any provisions of this 
subpart.
    (b) You may certify your vehicle family or subfamily to an FEL 
above an applicable standard based on a projection that you will have 
enough emission credits to offset the deficit for the vehicle family. 
See Sec.  1037.745 for provisions specifying what happens if you cannot 
show in your final report that you have enough actual emission credits 
to offset a deficit for any pollutant in a vehicle family.
    (c) We may void the certificate of conformity for a vehicle family 
if you fail to keep records, send reports, or give us information we 
request. Note that failing to keep records, send reports, or give us 
information we request is also a violation of 42 U.S.C. 7522(a)(2).
    (d) You may ask for a hearing if we void your certificate under 
this section (see Sec.  1037.820).


Sec.  1037.755  Information provided to the Department of 
Transportation.

    After receipt of each manufacturer's final report as specified in 
Sec.  1037.730 and completion of any verification testing required to 
validate the manufacturer's submitted final data, we will issue a 
report to the Department of Transportation with CO2 emission 
information and will verify the accuracy of each manufacturer's 
equivalent fuel consumption data required by NHTSA under 49 CFR 535.8. 
We will send a report to DOT for each vehicle manufacturer based on 
each regulatory category and subcategory, including sufficient 
information for NHTSA to determine fuel consumption and associated 
credit values. See 49 CFR 535.8 to determine if NHTSA deems submission 
of this information to EPA to also be a submission to NHTSA.

Subpart I--Definitions and Other Reference Information


Sec.  1037.801  Definitions.

    The following definitions apply to this part. The definitions apply 
to all subparts unless we note otherwise. All undefined terms have the 
meaning the Act gives to them. The definitions follow:
    Act means the Clean Air Act, as amended, 42 U.S.C. 7401-7671q.
    Adjustable parameter means any device, system, or element of design 
that someone can adjust (including those which are difficult to access) 
and that, if adjusted, may affect measured or modeled emissions (as 
applicable). You may ask us to exclude a parameter that is difficult to 
access if it cannot be adjusted to affect emissions without 
significantly degrading vehicle performance, or if you otherwise show 
us that it will not be adjusted in a way that affects emissions during 
in-use operation.
    Adjusted Loaded Vehicle Weight means the numerical average of 
vehicle curb weight and GVWR.
    Advanced technology means vehicle technology certified under 40 CFR 
86.1819-14(k)(7), 40 CFR 1036.615, or Sec.  1037.615.
    Aftertreatment means relating to a catalytic converter, particulate 
filter, or any other system, component, or technology mounted 
downstream of the exhaust valve (or exhaust port) whose design function 
is to decrease emissions in the vehicle exhaust before it is exhausted 
to the environment. Exhaust gas recirculation (EGR) and turbochargers 
are not aftertreatment.
    Aircraft means any vehicle capable of sustained air travel more 
than 100 feet off the ground.
    Alcohol-fueled vehicle means a vehicle that is designed to run 
using an alcohol fuel. For purposes of this definition, alcohol fuels 
do not include fuels with a nominal alcohol content below 25 percent by 
volume.
    Alternative fuel conversion has the meaning given for clean 
alternative fuel conversion in 40 CFR 85.502.
    Ambulance has the meaning given in 40 CFR 86.1803.
    Amphibious vehicle means a motor vehicle that is also designed for 
operation on water. Note that high ground clearance that enables a 
vehicle to drive through water rather than floating on the water does 
not make a vehicle amphibious.

[[Page 74119]]

    A to B testing means testing performed in pairs to allow comparison 
of two vehicles or other test articles. Back-to-back tests are 
performed on Article A and Article B, changing only the variable(s) of 
interest for the two tests.
    Automated manual transmission (AMT) means a transmission that 
operates mechanically similar to a manual transmission, except that an 
automated clutch actuator controlled by the onboard computer disengages 
and engages the drivetrain instead of a human driver. An automated 
manual transmission does not include a torque converter or a clutch 
pedal controllable by the driver.
    Automatic tire inflation system means a pneumatically or 
electronically activated system installed on a vehicle to maintain tire 
pressure at a preset level. These systems eliminate the need to 
manually inflate tires. Note that this is different than a ``tire 
pressure monitoring system,'' which we define separately in this 
section.
    Automatic transmission (AT) means a transmission with a torque 
converter (or equivalent) that uses computerize or other internal 
controls to shift gears in response to a single driver input for 
controlling vehicle speed. Note that automatic manual tranmissions are 
not automatic transmissions because they do not include torque 
converters.
    Auxiliary emission control device means any element of design that 
senses temperature, motive speed, engine rpm, transmission gear, or any 
other parameter for the purpose of activating, modulating, delaying, or 
deactivating the operation of any part of the emission control system.
    Auxiliary power unit means a device installed on a vehicle that 
uses an engine to provide power for purposes other than to (directly or 
indirectly) propel the vehicle.
    Averaging set has the meaning given in Sec.  1037.701.
    Axle ratio or Drive axle ratio, ka, means the 
dimensionless number representing the angular speed of the transmission 
output shaft divided by the angular speed of the drive axle.
    Basic vehicle frontal area means the area enclosed by the geometric 
projection of the basic vehicle along the longitudinal axis onto a 
plane perpendicular to the longitudinal axis of the vehicle, including 
tires but excluding mirrors and air deflectors. Note that in certain 
cases, this may refer to the combined area of a tractor and trailer.
    Box van has the meaning given in the definition for ``trailer'' in 
this section.
    Bus means a heavy-duty vehicle designed to carry more than 15 
passengers. Buses may include coach buses, school buses, and urban 
transit buses.
    Calibration means the set of specifications and tolerances specific 
to a particular design, version, or application of a component or 
assembly capable of functionally describing its operation over its 
working range.
    Carryover means relating to certification based on emission data 
generated from an earlier model year.
    Coach bus means a bus designed for inter-city passenger transport. 
Buses with features to accommodate standing passengers are not coach 
buses.
    Concrete mixer means a heavy-duty vehicle designed to mix and 
transport concrete in a permanently mounted revolving drum.
    Certification means relating to the process of obtaining a 
certificate of conformity for a vehicle family that complies with the 
emission standards and requirements in this part.
    Certified emission level means the highest deteriorated emission 
level in a vehicle subfamily for a given pollutant from either 
transient or steady-state testing.
    Class means relating to GVWR classes for vehicles other than 
trailers, as follows:
    (1) Class 2b means relating to heavy-duty motor vehicles at or 
below 10,000 pounds GVWR.
    (2) Class 3 means relating to heavy-duty motor vehicles above 
10,000 pounds GVWR but at or below 14,000 pounds GVWR.
    (3) Class 4 means relating to heavy-duty motor vehicles above 
14,000 pounds GVWR but at or below 16,000 pounds GVWR.
    (4) Class 5 means relating to heavy-duty motor vehicles above 
16,000 pounds GVWR but at or below 19,500 pounds GVWR.
    (5) Class 6 means relating to heavy-duty motor vehicles above 
19,500 pounds GVWR but at or below 26,000 pounds GVWR.
    (6) Class 7 means relating to heavy-duty motor vehicles above 
26,000 pounds GVWR but at or below 33,000 pounds GVWR.
    (7) Class 8 means relating to heavy-duty motor vehicles above 
33,000 pounds GVWR.
    Complete vehicle has the meaning given in the definition for 
vehicle in this section.
    Compression-ignition has the meaning given in Sec.  1037.101
    Container chassis means a trailer designed for carrying temporarily 
mounted shipping containers.
    Date of manufacture means the date on which the certifying vehicle 
manufacturer completes its manufacturing operations, except as follows:
    (1) Where the certificate holder is an engine manufacturer that 
does not manufacture the chassis, the date of manufacture of the 
vehicle is based on the date assembly of the vehicle is completed.
    (2) We may approve an alternate date of manufacture based on the 
date on which the certifying (or primary) manufacturer completes 
assembly at the place of main assembly, consistent with the provisions 
of Sec.  1037.601 and 49 CFR 567.4.
    Day cab means a type of tractor cab that is not a sleeper cab or a 
heavy-haul tractor cab.
    Designated Compliance Officer means one of the following:
    (1) For compression-ignition engines, Designated Compliance Officer 
means Director, Diesel Engine Compliance Center, U.S. Environmental 
Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105; 
[email protected]; epa.gov/otaq/verify.
    (2) For spark-ignition engines, Designated Compliance Officer means 
Director, Gasoline Engine Compliance Center, U.S. Environmental 
Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105; [email protected].
    Deteriorated emission level means the emission level that results 
from applying the appropriate deterioration factor to the official 
emission result of the emission-data vehicle. Note that where no 
deterioration factor applies, references in this part to the 
deteriorated emission level mean the official emission result.
    Deterioration factor means the relationship between the highest 
emissions during the useful life and emissions at the low-hour test 
point, expressed in one of the following ways:
    (1) For multiplicative deterioration factors, the ratio of the 
highest emissions to emissions at the low-hour test point.
    (2) For additive deterioration factors, the difference between the 
highest emissions and emissions at the low-hour test point.
    Diesel exhaust fluid (DEF) means a liquid reducing agent (other 
than the engine fuel) used in conjunction with selective catalytic 
reduction to reduce NOX emissions. Diesel exhaust fluid is 
generally understood to be an aqueous solution of urea conforming to 
the specifications of ISO 22241.
    Drayage tractor means a tractor that is intended for service in a 
port or

[[Page 74120]]

intermodal railyard, with multiple design features consistent with that 
intent, such as a cab with only a single seat, rear cab entry, a 
raisable fifth wheel, a solid-mounted rear suspension, and a maximum 
speed at or below 54 mi/hr.
    Drive idle means idle operation during which the vehicle operator 
remains in the vehicle cab, as evidenced by engaging the brake or 
clutch pedals, or by other indicators we approve.
    Driver model means an automated controller that simulates a person 
driving a vehicle.
    Dual-clutch transmission (DCT) means a transmission that operates 
similar to an automated manual transmission, but with two clutches that 
allow the transmission to maintain positive torque to the drive axle 
during a shift.
    Dual-fuel means relating to a vehicle or engine designed for 
operation on two different fuels but not on a continuous mixture of 
those fuels. For purposes of this part, such a vehicle or engine 
remains a dual-fuel vehicle or engine even if it is designed for 
operation on three or more different fuels.
    Electric vehicle means a vehicle that does not include an engine, 
and is powered solely by an external source of electricity and/or solar 
power. Note that this does not include hybrid electric vehicles or 
fuel-cell vehicles that use a chemical fuel such as gasoline, diesel 
fuel, or hydrogen. Electric vehicles may also be referred to as all-
electric vehicles to distinguish them from hybrid vehicles.
    Emergency vehicle means a vehicle that is an ambulance or a fire 
truck.
    Emission control system means any device, system, or element of 
design that controls or reduces the emissions of regulated pollutants 
from a vehicle.
    Emission-data component means a vehicle component that is tested 
for certification. This includes vehicle components tested to establish 
deterioration factors.
    Emission-data vehicle means a vehicle (or vehicle component) that 
is tested for certification. This includes vehicles tested to establish 
deterioration factors.
    Emission-related maintenance means maintenance that substantially 
affects emissions or is likely to substantially affect emission 
deterioration.
    Excluded means relating to vehicles that are not subject to some or 
all of the requirements of this part as follows:
    (1) A vehicle that has been determined not to be a ``motor 
vehicle'' is excluded from this part.
    (2) Certain vehicles are excluded from the requirements of this 
part under Sec.  1037.5.
    (3) Specific regulatory provisions of this part may exclude a 
vehicle generally subject to this part from one or more specific 
standards or requirements of this part.
    Exempted has the meaning given in 40 CFR 1068.30. Note that 
exempted vehicles are not considered to be excluded.
    Extended idle means tractor idle operation during which the engine 
is operating to power accessories for a sleeper compartment or other 
passenger compartment. Although the vehicle is generally parked during 
extended idle, the term ``parked idle'' generally refers to something 
different than extended idle.
    Family emission limit (FEL) means an emission level declared by the 
manufacturer to serve in place of an otherwise applicable emission 
standard under the ABT program in subpart H of this part. The family 
emission limit must be expressed to the same number of decimal places 
as the emission standard it replaces. Note that an FEL may apply as a 
``subfamily'' emission limit.
    Final drive ratio, kd, means the dimensionless number 
representing the angular speed of the transmission input shaft divided 
by the angular speed of the drive axle when the vehicle is operating in 
its highest available gear. The final drive ratio is the transmission 
gear ratio (in the highest available gear) multiplied by the drive axle 
ratio.
    Fire truck has the meaning given in 40 CFR 86.1803.
    Flatbed trailer means a trailer designed to accommodate side-
loading cargo onto a single, continuous load-bearing surface that runs 
from the rear of the trailer to at least the trailer's kingpin. This 
includes trailers that use curtains, straps, or other devices to 
restrain or protect cargo while underway. It also may include similar 
trailers that have one or more side walls without completely enclosing 
the cargo space. For purposes of this definition, disregard any ramps, 
moveable platforms, or other rear-mounted equipment or devices designed 
to assist with loading the trailer.
    Flexible-fuel means relating to an engine designed for operation on 
any mixture of two or more different fuels.
    Fuel system means all components involved in transporting, 
metering, and mixing the fuel from the fuel tank to the combustion 
chamber(s), including the fuel tank, fuel pump, fuel filters, fuel 
lines, carburetor or fuel-injection components, and all fuel-system 
vents. It also includes components for controlling evaporative 
emissions, such as fuel caps, purge valves, and carbon canisters.
    Fuel type means a general category of fuels such as diesel fuel or 
natural gas. There can be multiple grades within a single fuel type, 
such as high-sulfur or low-sulfur diesel fuel.
    Gaseous fuel means a fuel that has a boiling point below 20 [deg]C.
    Gear ratio or Transmission gear ratio, kg, means the 
dimensionless number representing the angular velocity of the 
transmission's input shaft divided by the angular velocity of the 
transmission's output shaft when the transmission is operating in a 
specific gear.
    Glider kit means either of the following:
    (1) A new vehicle that is incomplete because it lacks an engine, 
transmission, and/or axle(s).
    (2) Any other new equipment that is substantially similar to a 
complete motor vehicle and is intended to become a complete motor 
vehicle with a previously used engine (including a rebuilt or 
remanufactured engine). For example, incomplete heavy-duty tractor 
assemblies that are produced on the same assembly lines as complete 
tractors and that are made available to secondary vehicle manufacturers 
to complete assembly by installing used/remanufactured engines, 
transmissions and axles are glider kits.
    Glider vehicle means a new motor vehicle produced from a glider 
kit, or otherwise produced as a new motor vehicle with a with a used/
remanufactured engine.
    Good engineering judgment has the meaning given in 40 CFR 1068.30. 
See 40 CFR 1068.5 for the administrative process we use to evaluate 
good engineering judgment.
    Greenhouse gas Emissions Model (GEM) means the GEM simulation tool 
described in Sec.  1037.520 (incorporated by reference in Sec.  
1037.810). Note that an updated version of GEM applies starting in 
model year 2021.
    Gross axle weight rating (GAWR) means the value specified by the 
vehicle manufacturer as the maximum weight of a loaded axle or set of 
axles, consistent with good engineering judgment.
    Gross combination weight rating (GCWR) means the value specified by 
the vehicle manufacturer as the maximum weight of a loaded vehicle and 
trailer, consistent with good engineering judgment. For example, 
compliance with SAE J2807 is generally considered to be consistent with 
good engineering judgment, especially for Class 3 and smaller vehicles.

[[Page 74121]]

    Gross vehicle weight rating (GVWR) means the value specified by the 
vehicle manufacturer as the maximum design loaded weight of a single 
vehicle, consistent with good engineering judgment.
    Heavy-duty engine means any engine used for (or for which the 
engine manufacturer could reasonably expect to be used for) motive 
power in a heavy-duty vehicle.
    Heavy-duty vehicle means any trailer and any other motor vehicle 
that has a GVWR above 8,500 pounds, a curb weight above 6,000 pounds, 
or a basic vehicle frontal area greater than 45 square feet.
    Heavy-haul tractor means a tractor with GCWR greater than or equal 
to 120,000 pounds. A heavy-haul tractor is not a vocational tractor in 
Phase 2.
    Hybrid engine or hybrid powertrain means an engine or powertrain 
that includes energy storage features other than a conventional battery 
system or conventional flywheel. Supplemental electrical batteries and 
hydraulic accumulators are examples of hybrid energy storage systems. 
Note that certain provisions in this part treat hybrid engines and 
powertrains intended for vehicles that include regenerative braking 
different than those intended for vehicles that do not include 
regenerative braking.
    Hybrid vehicle means a vehicle that includes energy storage 
features (other than a conventional battery system or conventional 
flywheel) in addition to an internal combustion engine or other engine 
using consumable chemical fuel. Supplemental electrical batteries and 
hydraulic accumulators are examples of hybrid energy storage systems 
Note that certain provisions in this part treat hybrid vehicles that 
include regenerative braking different than those that do not include 
regenerative braking.
    Hydrocarbon (HC) means the hydrocarbon group on which the emission 
standards are based for each fuel type. For alcohol-fueled vehicles, HC 
means nonmethane hydrocarbon equivalent (NMHCE) for exhaust emissions 
and total hydrocarbon equivalent (THCE) for evaporative emissions. For 
all other vehicles, HC means nonmethane hydrocarbon (NMHC) for exhaust 
emissions and total hydrocarbon (THC) for evaporative emissions.
    Identification number means a unique specification (for example, a 
model number/serial number combination) that allows someone to 
distinguish a particular vehicle from other similar vehicles.
    Idle operation means any operation other than PTO operation during 
which the vehicle speed is zero. Idle operation may be ``Drive idle'' 
or ``Parked idle'' (as defined in this section).
    Incomplete vehicle has the meaning given in the definition of 
vehicle in this section.
    Innovative technology means technology certified under Sec.  
1037.610 (also described as ``off-cycle technology'').
    Light-duty truck means any motor vehicle rated at or below 8,500 
pounds GVWR with a curb weight at or below 6,000 pounds and basic 
vehicle frontal area at or below 45 square feet, which is:
    (1) Designed primarily for purposes of transportation of property 
or is a derivation of such a vehicle; or
    (2) Designed primarily for transportation of persons and has a 
capacity of more than 12 persons; or
    (3) Available with special features enabling off-street or off-
highway operation and use.
    Light-duty vehicle means a passenger car or passenger car 
derivative capable of seating 12 or fewer passengers.
    Low-mileage means relating to a vehicle with stabilized emissions 
and represents the undeteriorated emission level. This would generally 
involve approximately 4000 miles of operation.
    Low rolling resistance tire means a tire on a vocational vehicle 
with a TRRL at or below of 7.7 kg/tonne, a steer tire on a tractor with 
a TRRL at or below 7.7 kg/tonne, a drive tire on a tractor with a TRRL 
at or below 8.1 kg/tonne, a tire on a non-box trailer with a TRRL at or 
below of 6.5 kg/tonne, or a tire on a box van with a TRRL at or below 
of 6.0 kg/tonne,.
    Manual transmission (MT) means a transmission that requires the 
driver to shift the gears and manually engage and disengage the clutch.
    Manufacture means the physical and engineering process of 
designing, constructing, and/or assembling a vehicle.
    Manufacturer has the meaning given in section 216(1) of the Act. In 
general, this term includes any person who manufactures or assembles a 
vehicle (including a trailer or another incomplete vehicle) for sale in 
the United States or otherwise introduces a new motor vehicle into 
commerce in the United States. This includes importers who import 
vehicles for resale, entities that manufacture glider kits, and 
entities that assemble glider vehicles.
    Medium-duty passenger vehicle (MDPV) has the meaning given in 40 
CFR 86.1803.
    Model year means one of the following for compliance with this part 
1037. Note that manufacturers may have other model year designations 
for the same vehicle for compliance with other requirements or for 
other purposes:
    (1) For tractors and vocational vehicles with a date of manufacture 
on or after January 1, 2021, the vehicle's model year is the calendar 
year corresponding to the date of manufacture; however, the vehicle's 
model year may be designated to be the year before the calendar year 
corresponding to the date of manufacture if the engine's model year is 
also from an earlier year. Note that Sec.  1037.601(a)(2) limits the 
extent to which vehicle manufacturers may install engines built in 
earlier calendar years.
    (2) For trailers and for Phase 1 tractors and vocational vehicles 
with a date of manufacture before January 1, 2021, model year means the 
manufacturer's annual new model production period, except as restricted 
under this definition and 40 CFR part 85, subpart X. It must include 
January 1 of the calendar year for which the model year is named, may 
not begin before January 2 of the previous calendar year, and it must 
end by December 31 of the named calendar year. The model year may be 
set to match the calendar year corresponding to the date of 
manufacture.
    (i) The manufacturer who holds the certificate of conformity for 
the vehicle must assign the model year based on the date when its 
manufacturing operations are completed relative to its annual model 
year period. In unusual circumstances where completion of your assembly 
is delayed, we may allow you to assign a model year one year earlier, 
provided it does not affect which regulatory requirements will apply.
    (ii) Unless a vehicle is being shipped to a secondary vehicle 
manufacturer that will hold the certificate of conformity, the model 
year must be assigned prior to introduction of the vehicle into U.S. 
commerce. The certifying manufacturer must redesignate the model year 
if it does not complete its manufacturing operations within the 
originally identified model year. A vehicle introduced into U.S. 
commerce without a model year is deemed to have a model year equal to 
the calendar year of its introduction into U.S. commerce unless the 
certifying manufacturer assigns a later date.
    Motor home has the meaning given in 49 CFR 571.3.
    Motor vehicle has the meaning given in 40 CFR 85.1703.
    Multi-Purpose means relating to the Multi-Purpose duty cycle as 
specified in Sec.  1037.510.

[[Page 74122]]

    Neutral coasting means a vehicle technology that automatically puts 
the transmission in neutral when the vehicle has minimal power demand, 
such as driving downhill.
    Neutral idle means a vehicle technology that automatically puts the 
transmission in neutral when the vehicle is stopped, as described in 
Sec.  1037.660(a).
    New motor vehicle has the meaning given in the Act. It generally 
means a motor vehicle meeting the criteria of either paragraph (1) or 
(2) of this definition. New motor vehicles may be complete or 
incomplete.
    (1) A motor vehicle for which the ultimate purchaser has never 
received the equitable or legal title is a new motor vehicle. This kind 
of vehicle might commonly be thought of as ``brand new'' although a new 
motor vehicle may include previously used parts. For example, vehicles 
commonly known as ``glider kits,'' ``glider vehicles,'' or ``gliders'' 
are new motor vehicles. Under this definition, the vehicle is new from 
the time it is produced until the ultimate purchaser receives the title 
or places it into service, whichever comes first.
    (2) An imported heavy-duty motor vehicle originally produced after 
the 1969 model year is a new motor vehicle.
    Noncompliant vehicle means a vehicle that was originally covered by 
a certificate of conformity, but is not in the certified configuration 
or otherwise does not comply with the conditions of the certificate.
    Nonconforming vehicle means a vehicle not covered by a certificate 
of conformity that would otherwise be subject to emission standards.
    Nonmethane hydrocarbon (NMHC) means the sum of all hydrocarbon 
species except methane, as measured according to 40 CFR part 1065.
    Nonmethane hydrocarbon equivalent (NMHCE) has the meaning given in 
40 CFR 1065.1001.
    Off-cycle technology means technology certified under Sec.  
1037.610 (also described as ``innovative technology'').
    Official emission result means the measured emission rate for an 
emission-data vehicle on a given duty cycle before the application of 
any required deterioration factor, but after the applicability of 
regeneration adjustment factors.
    Owners manual means a document or collection of documents prepared 
by the vehicle manufacturer for the owners or operators to describe 
appropriate vehicle maintenance, applicable warranties, and any other 
information related to operating or keeping the vehicle. The owners 
manual is typically provided to the ultimate purchaser at the time of 
sale. The owners manual may be in paper or electronic format.
    Oxides of nitrogen has the meaning given in 40 CFR 1065.1001.
    Parked idle means idle operation during which the transmission is 
set to park, or the transmission is in neutral with the parking brake 
engaged. Although this idle may occur for extended periods, the term 
``extended idle'' refers to tractor operation in which the engine is 
operating to power accessories for a sleeper compartment or other 
passenger compartment.
    Particulate trap means a filtering device that is designed to 
physically trap all particulate matter above a certain size.
    Percent (%) has the meaning given in 40 CFR 1065.1001. Note that 
this means percentages identified in this part are assumed to be 
infinitely precise without regard to the number of significant figures. 
For example, one percent of 1,493 is 14.93.
    Petroleum means gasoline or diesel fuel or other fuels normally 
derived from crude oil. This does not include methane or liquefied 
petroleum gas.
    Phase 1 means relating to the Phase 1 standards specified in 
Sec. Sec.  1037.105 and 1037.106. For example, a vehicle subject to the 
Phase 1 standards is a Phase 1 vehicle. Note that there are no Phase 1 
standards for trailers.
    Phase 2 means relating to the Phase 2 standards specified in 
Sec. Sec.  1037.105 through 1037.107.
    Placed into service means put into initial use for its intended 
purpose, excluding incidental use by the manufacturer or a dealer.
    Power take-off (PTO) means a secondary engine shaft (or equivalent) 
that provides substantial auxiliary power for purposes unrelated to 
vehicle propulsion or normal vehicle accessories such as air 
conditioning, power steering, and basic electrical accessories. A 
typical PTO uses a secondary shaft on the engine to transmit power to a 
hydraulic pump that powers auxiliary equipment, such as a boom on a 
bucket truck. You may ask us to consider other equivalent auxiliary 
power configurations (such as those with hybrid vehicles) as power 
take-off systems.
    Preliminary approval means approval granted by an authorized EPA 
representative prior to submission of an application for certification, 
consistent with the provisions of Sec.  1037.210 or 1037.211.
    Rechargeable Energy Storage System (RESS) means the component(s) of 
a hybrid engine or vehicle that store recovered energy for later use, 
such as the battery system in an electric hybrid vehicle.
    Refuse hauler means a heavy-duty vehicle whose primary purpose is 
to collect, compact, and transport solid waste, including recycled 
solid waste.
    Regional means relating to the Regional duty cycle as specified in 
Sec.  1037.510.
    Regulatory subcategory has the meaning given in Sec.  1037.230.
    Relating to as used in this section means relating to something in 
a specific, direct manner. This expression is used in this section only 
to define terms as adjectives and not to broaden the meaning of the 
terms.
    Revoke has the meaning given in 40 CFR 1068.30.
    Roof height means the maximum height of a vehicle (rounded to the 
nearest inch), excluding narrow accessories such as exhaust pipes and 
antennas, but including any wide accessories such as roof fairings. 
Measure roof height of the vehicle configured to have its maximum 
height that will occur during actual use, with properly inflated tires 
and no driver, passengers, or cargo onboard. Roof height may also refer 
to the following categories:
    (1) Low-roof means relating to a vehicle with a roof height of 120 
inches or less.
    (2) Mid-roof means relating to a vehicle with a roof height of 121 
to 147 inches.
    (3) High-roof means relating to a vehicle with a roof height of 148 
inches or more.
    Round has the meaning given in 40 CFR 1065.1001.
    Scheduled maintenance means adjusting, repairing, removing, 
disassembling, cleaning, or replacing components or systems 
periodically to keep a part or system from failing, malfunctioning, or 
wearing prematurely. It also may mean actions you expect are necessary 
to correct an overt indication of failure or malfunction for which 
periodic maintenance is not appropriate.
    School bus has the meaning given in 49 CFR 571.3.
    Secondary vehicle manufacturer anyone that produces a vehicle by 
modifying a complete vehicle or completing the assembly of a partially 
complete vehicle. For the purpose of this definition, ``modifying'' 
generally does not include making changes that do not remove a vehicle 
from its original certified configuration. However, custom sleeper 
modifications and alternative fuel conversions that change actual 
vehicle aerodynamics are

[[Page 74123]]

considered to be modifications, even if they are permitted without 
recertification. This definition applies whether the production 
involves a complete or partially complete vehicle and whether the 
vehicle was previously certified to emission standards or not. 
Manufacturers controlled by the manufacturer of the base vehicle (or by 
an entity that also controls the manufacturer of the base vehicle) are 
not secondary vehicle manufacturers; rather, both entities are 
considered to be one manufacturer for purposes of this part.
    Sleeper cab means a type of tractor cab that has a compartment 
behind the driver's seat intended to be used by the driver for 
sleeping, and is not a heavy-haul tractor cab. This includes cabs 
accessible from the driver's compartment and those accessible from 
outside the vehicle.
    Small manufacturer means a manufacturer meeting the criteria 
specified in 13 CFR 121.201. The employee and revenue limits apply to 
the total number employees and total revenue together for affiliated 
companies.
    Spark-ignition has the meaning given in Sec.  1037.101.
    Standard payload means the payload assumed for each vehicle, in 
tons, for modeling and calculating emission credits, as follows:
    (1) For vocational vehicles:
    (i) 2.85 tons for Light HDV.
    (ii) 5.6 tons for Medium HDV.
    (iii) 7.5 tons for Heavy HDV.
    (2) For tractors:
    (i) 12.5 tons for Class 7.
    (ii) 19 tons for Class 8, other than heavy-haul tractors.
    (iii) 43 tons for heavy-haul tractors.
    (3) For trailers:
    (i) 10 tons for short box vans.
    (ii) 19 tons for other trailers.
    Standard tractor has the meaning given in Sec.  1037.501.
    Standard trailer has the meaning given in Sec.  1037.501.
    Stop-start means a vehicle technology that automatically turns the 
engine off when the vehicle is stopped, as described in Sec.  
1037.660(a).
    Suspend has the meaning given in 40 CFR 1068.30.
    Tank trailer means a trailer designed to transport liquids or 
gases.
    Test sample means the collection of vehicles or components selected 
from the population of a vehicle family for emission testing. This may 
include testing for certification, production-line testing, or in-use 
testing.
    Test vehicle means a vehicle in a test sample.
    Test weight means the vehicle weight used or represented during 
testing.
    Tire pressure monitoring system (TPMS) is a vehicle system that 
monitors air pressure in each tire and alerts the operator when tire 
pressure falls below a specified value.
    Tire rolling resistance level (TRRL) means a value with units of 
kg/tonne that represents the rolling resistance of a tire 
configuration. TRRLs are used as modeling inputs under Sec. Sec.  
1037.515 and 1037.520. Note that a manufacturer may use the measured 
value for a tire configuration's coefficient of rolling resistance, or 
assign some higher value.
    Total hydrocarbon has the meaning given in 40 CFR 1065.1001. This 
generally means the combined mass of organic compounds measured by the 
specified procedure for measuring total hydrocarbon, expressed as a 
hydrocarbon with an atomic hydrogen-to-carbon ratio of 1.85:1.
    Total hydrocarbon equivalent has the meaning given in 40 CFR 
1065.1001. This generally means the sum of the carbon mass 
contributions of non-oxygenated hydrocarbon, alcohols and aldehydes, or 
other organic compounds that are measured separately as contained in a 
gas sample, expressed as exhaust hydrocarbon from petroleum-fueled 
vehicles. The atomic hydrogen-to-carbon ratio of the equivalent 
hydrocarbon is 1.85:1.
    Tractor has the meaning given for ``truck tractor'' in 49 CFR 
571.3. This includes most heavy-duty vehicles specifically designed for 
the primary purpose of pulling trailers, but does not include vehicles 
designed to carry other loads. For purposes of this definition ``other 
loads'' would not include loads carried in the cab, sleeper 
compartment, or toolboxes. Examples of vehicles that are similar to 
tractors but that are not tractors under this part include dromedary 
tractors, automobile haulers, straight trucks with trailers hitches, 
and tow trucks. Note that the provisions of this part that apply for 
tractors do not apply for tractors that are classified as vocational 
tractors under Sec.  1037.630.
    Trailer means a piece of equipment designed for carrying cargo and 
for being drawn by a tractor when coupled to the tractor's fifth wheel. 
These trailers may be known commercially as semi-trailers or truck 
trailers. This definition excludes equipment that serve similar 
purposes but are not intended to be pulled by a tractor, whether or not 
they are known commercially as trailers. Trailers may be divided into 
different types and categories as described in paragraphs (1) through 
(4) of this definition. The types of equipment identified in paragraph 
(5) of this definition are not trailers for purposes of this part.
    (1) Box vans are trailers with enclosed cargo space that is 
permanently attached to the chassis, with fixed sides, nose, and roof. 
Tank trailers are not box vans.
    (2) Box vans with self-contained HVAC systems are refrigerated 
vans. Note that this includes systems that provide cooling, heating, or 
both. All other box vans are dry vans.
    (3) Trailers that are not box vans are non-box trailers. Note that 
the standards for non-box trailers in this part 1037 apply only to 
flatbed trailers, tank trailers, and container chassis.
    (4) Box vans with length at or below 50.0 feet are short box vans. 
Other box vans are long box vans.
    (5) The following types of equipment are not trailers for purposes 
of this part 1037:
    (i) Containers that are not permanently mounted on chassis.
    (ii) Dollies used to connect tandem trailers.
    Ultimate purchaser means, with respect to any new vehicle, the 
first person who in good faith purchases such new vehicle for purposes 
other than resale.
    United States has the meaning given in 40 CFR 1068.30.
    Upcoming model year means for a vehicle family the model year after 
the one currently in production.
    Urban means relating to the Urban duty cycle as specified in Sec.  
1037.510.
    U.S.-directed production volume means the number of vehicle units, 
subject to the requirements of this part, produced by a manufacturer 
for which the manufacturer has a reasonable assurance that sale was or 
will be made to ultimate purchasers in the United States. This does not 
include vehicles certified to state emission standards that are 
different than the emission standards in this part.
    Useful life means the period during which a vehicle is required to 
comply with all applicable emission standards.
    Vehicle means equipment intended for use on highways that meets at 
least one of the criteria of paragraph (1) of this definition, as 
follows:
    (1) The following equipment are vehicles:
    (i) A piece of equipment that is intended for self-propelled use on 
highways becomes a vehicle when it includes at least an engine, a 
transmission, and a frame. (Note: For purposes of this definition, any 
electrical, mechanical, and/or hydraulic devices attached to engines 
for the purpose of powering wheels are considered to be transmissions.)
    (ii) A piece of equipment that is intended for self-propelled use 
on highways becomes a vehicle when it

[[Page 74124]]

includes a passenger compartment attached to a frame with one or more 
axles.
    (iii) Trailers. A trailer becomes a vehicle when it has a frame 
with one or more axles attached.
    (2) Vehicles other than trailers may be complete or incomplete 
vehicles as follows:
    (i) A complete vehicle is a functioning vehicle that has the 
primary load carrying device or container (or equivalent equipment) 
attached. Examples of equivalent equipment would include fifth wheel 
trailer hitches, firefighting equipment, and utility booms.
    (ii) An incomplete vehicle is a vehicle that is not a complete 
vehicle. Incomplete vehicles may also be cab-complete vehicles. This 
may include vehicles sold to secondary vehicle manufacturers.
    (iii) The primary use of the terms ``complete vehicle'' and 
``incomplete vehicle'' are to distinguish whether a vehicle is complete 
when it is first sold as a vehicle.
    (iv) You may ask us to allow you to certify a vehicle as incomplete 
if you manufacture the engines and sell the unassembled chassis 
components, as long as you do not produce and sell the body components 
necessary to complete the vehicle.
    Vehicle configuration means a unique combination of vehicle 
hardware and calibration (related to measured or modeled emissions) 
within a vehicle family. Vehicles with hardware or software 
differences, but that have no hardware or software differences related 
to measured or modeled emissions may be included in the same vehicle 
configuration. Note that vehicles with hardware or software differences 
related to measured or modeled emissions are considered to be different 
configurations even if they have the same GEM inputs and FEL. Vehicles 
within a vehicle configuration differ only with respect to normal 
production variability or factors unrelated to measured or modeled 
emissions.
    Vehicle family has the meaning given in Sec.  1037.230.
    Vehicle service class has the meaning given in Sec.  1037.140. The 
different vehicle service classes are Light HDV, Medium HDV, and Heavy 
HDV.
    Vehicle subfamily or subfamily means a subset of a vehicle family 
including vehicles subject to the same FEL(s).
    Vocational tractor means a vehicle classified as a vocational 
tractor under Sec.  1037.630.
    Vocational vehicle means relating to a vehicle subject to the 
standards of Sec.  1037.105 (including vocational tractors).
    Void has the meaning given in 40 CFR 1068.30.
    Volatile liquid fuel means any fuel other than diesel or biodiesel 
that is a liquid at atmospheric pressure and has a Reid Vapor Pressure 
higher than 2.0 pounds per square inch.
    We (us, our) means the Administrator of the Environmental 
Protection Agency and any authorized representatives.


Sec.  1037.805  Symbols, abbreviations, and acronyms.

    The procedures in this part generally follow either the 
International System of Units (SI) or the United States customary 
units, as detailed in NIST Special Publication 811 (incorporated by 
reference in Sec.  1037.810). See 40 CFR 1065.20 for specific 
provisions related to these conventions. This section summarizes the 
way we use symbols, units of measure, and other abbreviations.
    (a) Symbols for chemical species. This part uses the following 
symbols for chemical species and exhaust constituents:

------------------------------------------------------------------------
                  Symbol                               Species
------------------------------------------------------------------------
C.........................................  carbon.
CH4.......................................  methane.
CO........................................  carbon monoxide.
CO2.......................................  carbon dioxide.
H2O.......................................  water.
HC........................................  hydrocarbon.
NMHC......................................  nonmethane hydrocarbon.
NMHCE.....................................  nonmethane hydrocarbon
                                             equivalent.
NO........................................  nitric oxide.
NO2.......................................  nitrogen dioxide.
NOX.......................................  oxides of nitrogen.
N2O.......................................  nitrous oxide.
PM........................................  particulate matter.
THC.......................................  total hydrocarbon.
THCE......................................  total hydrocarbon
                                             equivalent.
------------------------------------------------------------------------

    (b) Symbols for quantities. This part uses the following symbols 
and units of measure for various quantities:

----------------------------------------------------------------------------------------------------------------
                                                                                      Unit in terms of SI base
    Symbol             Quantity                  Unit              Unit symbol                 units
----------------------------------------------------------------------------------------------------------------
A.............  vehicle frictional      pound force or newton.  lbf or N.........  kg[middot]m[middot]s-2.
                 load.
a.............  axle position
                 regression
                 coefficient.
[alpha].......  atomic hydrogen-to-     mole per mole.........  mol/mol..........  1.
                 carbon ratio.
[alpha].......  axle position
                 regression
                 coefficient.
[alpha]0......  intercept of air speed
                 correction.
[alpha]1......  slope of air speed
                 correction.
ag............  acceleration of         meters per second       m/s\2\...........  m[middot]s-2.
                 Earth's gravity.        squared.
a0............  intercept of least
                 squares regression.
a1............  slope of least squares
                 regression.
B.............  vehicle load from drag  pound force per mile    lbf/(mi/hr) or     kg[middot]s-1.
                 and rolling             per hour or newton      N[middot]s/m.
                 resistance.             second per meter.
b.............  axle position
                 regression
                 coefficient.
[beta]........  atomic oxygen-to-       mole per mole.........  mol/mol..........  1.
                 carbon ratio.
[beta]........  axle position
                 regression
                 coefficient.
[beta]0.......  intercept of air
                 direction correction.
[beta]1.......  slope of air direction
                 correction.
C.............  vehicle-specific        pound force per mile    lbf/mph\2\ or      kg[middot]m-1.
                 aerodynamic effects.    per hour squared or     N[middot]s\2\/
                                         newton-second squared   m\1\.
                                         per meter squared.
c.............  axle position
                 regression
                 coefficient.
ci............  axle test regression
                 coefficients.
Ci............  constant..............
[Delta]CdA....  differential drag area  meter squared.........  m\2\.............  m\2\.
CdA...........  drag area.............  meter squared.........  m\2\.............  m\2\.
Cd............  drag coefficient......
CF............  correction factor.....
Crr...........  coefficient of rolling  kilogram per metric     kg/tonne.........  10-2.
                 resistance.             ton.
D.............  distance..............  miles or meters.......  mi or m..........  m.

[[Page 74125]]

 
e.............  mass-weighted emission  grams/ton-mile........  g/ton-mi.........  g/kg-km.
                 result.
Eff...........  efficiency............
F.............  adjustment factor.....
F.............  force.................  pound force or newton.  lbf or N.........  kg[middot]m[middot]s-2.
fn............  angular speed (shaft).  revolutions per minute  r/min............  [pi][middot]30[middot]s-1.
G.............  road grade............  percent...............  %................  10-2.
g.............  gravitational           meters per second       m/s\2\...........  m[middot]s-2.
                 acceleration.           squared.
h.............  elevation or height...  meters................  m................  m.
i.............  indexing variable.....
ka............  drive axle ratio......                                             1
kd............  transmission gear
                 ratio.
ktopgear......  highest available
                 transmission gear.
L.............  load over axle........  pound force or newton.  lbf or N.........  kg[middot]m[middot]s-2.
m.............  mass..................  pound mass or kilogram  lbm or kg........  kg.
M.............  molar mass............  gram per mole.........  g/mol............  10-3[middot]kg[middot]mol-1.
M.............  vehicle mass..........  kilogram..............  kg...............  kg.
Me............  vehicle effective mass  kilogram..............  kg...............  kg.
Mrotating.....  inertial mass of        kilogram..............  kg...............  kg.
                 rotating components.
N.............  total number in series
n.............  number of tires.......
n.............  amount of substance     mole per second.......  mol/s............  mol[middot]s-1.
                 rate.
P.............  power.................  kilowatt..............  kW...............  10\3\[middot]m\2\[middot]kg[m
                                                                                    iddot]s-3.
P.............  tire inflation          pascal................  Pa...............  kg[middot]m-1[middot]s-2.
                 pressure.
p.............  pressure..............  pascal................  Pa...............  kg[middot]m-1[middot]s-2.
[rho].........  mass density..........  kilogram per cubic      kg/m\3\..........  kg[middot]m-3.
                                         meter.
PL............  payload...............  tons..................  ton..............  kg.
[phis]........  direction.............  degrees...............  [deg]............  [deg].
1.............  direction.............  degrees...............  [deg]............  [deg].
r.............  tire radius...........  meter.................  m................  m.
r\2\..........  coefficient of
                 determination.
Re#...........  Reynolds number.......
SEE...........  standard estimate of
                 error.
[sigma].......  standard deviation....
TRPM..........  tire revolutions per    revolutions per mile..  r/mi.............
                 mile.
TRRL..........  tire rolling            kilogram per metric     kg/tonne.........  10-3.
                 resistance level.       ton.
T.............  absolute temperature..  kelvin................  K................  K.
T.............  Celsius temperature...  degree Celsius........  [deg]C...........  K-273.15.
T.............  torque (moment of       newton meter..........  N[middot]m.......  m\2\[middot]kg[middot]s-2.
                 force).
t.............  time..................  hour or second........  hr or s..........  s.
[Delta]t......  time interval, period,  second................  s................  s.
                 1/frequency.
UF............  utility factor........
v.............  speed.................  miles per hour or       mi/hr or m/s.....  m[middot]s-1.
                                         meters per second.
w.............  weighting factor......
w.............  wind speed............  miles per hour........  mi/hr............  m[middot]s-1.
W.............  work..................  kilowatt-hour.........  kW[middot]hr.....  3.6[middot]m\2\[middot]kg[mid
                                                                                    dot]s-1.
wC............  carbon mass fraction..  gram/gram.............  g/g..............  1.
WR............  weight reduction......  pound mass............  lbm..............  kg.
x.............  amount of substance     mole per mole.........  mol/mol..........  1.
                 mole fraction.
----------------------------------------------------------------------------------------------------------------

    (c) Superscripts. This part uses the following superscripts to 
define a quantity:

------------------------------------------------------------------------
                Superscript                           Quantity
------------------------------------------------------------------------
overbar (such as y).......................  arithmetic mean.
Double overbar (such......................  arithmetic mean of
 =                                           arithmetic mean.
 as y)....................................
overdot (such as y).......................  quantity per unit time.
------------------------------------------------------------------------

    (d) Subscripts. This part uses the following subscripts to define a 
quantity:

------------------------------------------------------------------------
               Subscript                             Quantity
------------------------------------------------------------------------
6..........................  6[deg] yaw angle
                                          sweep.
A......................................  A speed.
air....................................  air.
aero...................................  aerodynamic.
alt....................................  alternative.
act....................................  actual or measured condition.
air....................................  air.
axle...................................  axle.
B......................................  B speed.
brake..................................  brake.
C......................................  C speed.
Ccombdry...............................  carbon from fuel per mole of
                                          dry exhaust.
CD.....................................  charge-depleting.
circuit................................  circuit.
CO2DEF.................................  CO2 resulting from diesel
                                          exhaust fluid decomposition.
CO2PTO.................................  CO2 emissions for PTO cycle.
coastdown..............................  coastdown.
comp...................................  composite.
CS.....................................  charge-sustaining.
cycle..................................  test cycle.
drive..................................  drive axle.
drive-idle.............................  idle with the transmission in
                                          drive.
driver.................................  driver.
dyno...................................  dynamometer.
effective..............................  effective.
end....................................  end.
eng....................................  engine.
event..................................  event.
fuel...................................  fuel.
full...................................  full.
grade..................................  grade.
H2Oexhaustdry..........................  H2O in exhaust per mole of
                                          exhaust.
hi.....................................  high.
i......................................  an individual of a series.
idle...................................  idle.
in.....................................  inlet.
inc....................................  increment.
lo.....................................  low.

[[Page 74126]]

 
loss...................................  loss.
max....................................  maximum.
meas...................................  measured quantity.
med....................................  median.
min....................................  minimum.
moving.................................  moving.
out....................................  outlet.
P......................................  power.
pair...................................  pair of speed segments.
parked-idle............................  idle with the transmission in
                                          park.
partial................................  partial.
ploss..................................  power loss.
plug-in................................  plug-in hybrid electric
                                          vehicle.
powertrain.............................  powertrain.
PTO....................................  power take-off.
rated..................................  rated speed.
record.................................  record.
ref....................................  reference quantity.
RL.....................................  road load.
rotating...............................  rotating.
seg....................................  segment.
speed..................................  speed.
spin...................................  axle spin loss.
start..................................  start.
steer..................................  steer axle.
t......................................  tire.
test...................................  test.
th.....................................  theoretical.
total..................................  total.
trac...................................  traction.
trac10.................................  traction force at 10 mi/hr.
trailer................................  trailer axle.
transient..............................  transient.
TRR....................................  tire rolling resistance.
urea...................................  urea.
veh....................................  vehicle.
w......................................  wind.
wa.....................................  wind average.
yaw....................................  yaw angle.
ys.....................................  yaw sweep.
zero...................................  zero quantity.
------------------------------------------------------------------------

    (e) Other acronyms and abbreviations. This part uses the following 
additional abbreviations and acronyms:

------------------------------------------------------------------------
 
------------------------------------------------------------------------
ABT....................................  averaging, banking, and
                                          trading.
AECD...................................  auxiliary emission control
                                          device.
AES....................................  automatic engine shutdown.
APU....................................  auxiliary power unit.
CD.....................................  charge-depleting.
CFD....................................  computational fluid dynamics.
CFR....................................  Code of Federal Regulations.
CITT...................................  curb idle transmission torque.
CS.....................................  charge-sustaining.
DOT....................................  Department of Transportation.
EPA....................................  Environmental Protection
                                          Agency.
FE.....................................  fuel economy.
FEL....................................  Family Emission Limit.
GAWR...................................  gross axle weight rating.
GCWR...................................  gross combination weight
                                          rating.
GEM....................................  greenhouse gas emission model.
GVWR...................................  gross vehicle weight rating.
Heavy HDV..............................  Heavy heavy-duty vehicle (see
                                          Sec.   1037.140).
HVAC...................................  heating, ventilating, and air
                                          conditioning.
ISO....................................  International Organization for
                                          Standardization.
Light HDV..............................  Light heavy-duty vehicle (see
                                          Sec.   1037.140).
Medium HDV.............................  Medium heavy-duty vehicle (see
                                          Sec.   1037.140).
NARA...................................  National Archives and Records
                                          Administration.
NHTSA..................................  National Highway Transportation
                                          Safety Administration.
PHEV...................................  plug-in hybrid electric
                                          vehicle.
PTO....................................  power take-off.
RESS...................................  rechargeable energy storage
                                          system.
rpm....................................  revolutions per minute.
SAE....................................  Society of Automotive
                                          Engineers.
SEE....................................  standard error of estimate.
SKU....................................  stock-keeping unit.
TRPM...................................  tire revolutions per mile.
TRRL...................................  tire rolling resistance level.
U.S.C..................................  United States Code.
VSL....................................  vehicle speed limiter.
------------------------------------------------------------------------

    (f) Constants. This part uses the following constants:

------------------------------------------------------------------------
           Symbol                   Quantity                Value
------------------------------------------------------------------------
g...........................  gravitational         9.81 m[middot]s-2.
                               constant.
R...........................  specific gas          287.058 J/
                               constant.             (kg[middot]K).
------------------------------------------------------------------------

    (g) Prefixes. This part uses the following prefixes to define a 
quantity:

------------------------------------------------------------------------
              Symbol                      Quantity             Value
------------------------------------------------------------------------
[micro]...........................  micro...............            10-6
m.................................  milli...............            10-3
c.................................  centi...............            10-2
k.................................  kilo................           10\3\
M.................................  mega................           10\6\
------------------------------------------------------------------------

Sec.  1037.810  Incorporation by reference.

    (a) Certain material is incorporated by reference into this part 
with the approval of the Director of the Federal Register under 5 
U.S.C. 552(a) and 1 CFR part 51. To enforce any edition other than that 
specified in this section, the Environmental Protection Agency must 
publish a document in the Federal Register and the material must be 
available to the public. All approved material is available for 
inspection at U.S. EPA, Air and Radiation Docket and Information 
Center, 1301 Constitution Ave. NW., Room B102, EPA West Building, 
Washington, DC 20460, (202) 202-1744, and is available from the sources 
listed below. It is also available for inspection at the National 
Archives and Records Administration (NARA). For information on the 
availability of this material at NARA, call 202-741-6030, or go to 
http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.
    (b) International Organization for Standardization, Case Postale 
56, CH-1211 Geneva 20, Switzerland, (41) 22749 0111, www.iso.org, or 
[email protected].
    (1) ISO 28580:2009(E) ``Passenger car, truck and bus tyres--Methods 
of measuring rolling resistance--Single point test and correlation of 
measurement results'', First Edition, July 1, 2009, (``ISO 28580''), 
IBR approved for Sec.  1037.520(c).
    (2) [Reserved]
    (c) U.S. EPA, Office of Air and Radiation, 2565 Plymouth Road, Ann 
Arbor, MI 48105, www.epa.gov.
    (1) Greenhouse gas Emissions Model (GEM), Version 2.0.1, September 
2012 (``GEM version 2.0.1''), IBR approved for Sec.  1037.520. The 
computer code for this model is available as noted in paragraph (a) of 
this section. A working version of this software is also available for 
download at http://www.epa.gov/otaq/climate/gem.htm.
    (2) Greenhouse gas Emissions Model (GEM) Phase 2, Version 3.0, July 
2016; IBR approved for Sec.  1037.520. The computer code for this model 
is available as noted in paragraph (a) of this section. A working 
version of this software is also available for download

[[Page 74127]]

at http://www.epa.gov/otaq/climate/gem.htm.
    (d) National Institute of Standards and Technology, 100 Bureau 
Drive, Stop 1070, Gaithersburg, MD 20899-1070, (301) 975-6478, or 
www.nist.gov.
    (1) NIST Special Publication 811, Guide for the Use of the 
International System of Units (SI), 2008 Edition, March 2008, IBR 
approved for Sec.  1037.805.
    (2) [Reserved]
    (e) SAE International, 400 Commonwealth Dr., Warrendale, PA 15096-
0001, (877) 606-7323 (U.S. and Canada) or (724) 776-4970 (outside the 
U.S. and Canada), http://www.sae.org.
    (1) SAE J1025, Test Procedures for Measuring Truck Tire Revolutions 
Per Kilometer/Mile, Stabilized August 2012, (``SAE J1025''), IBR 
approved for Sec.  1037.520(c).
    (2) SAE J1252, SAE Wind Tunnel Test Procedure for Trucks and Buses, 
Revised July 2012, (``SAE J1252''), IBR approved for Sec. Sec.  
1037.525(b) and 1037.530(a).
    (3) SAE J1263, Road Load Measurement and Dynamometer Simulation 
Using Coastdown Techniques, revised March 2010, (``SAE J1263''), IBR 
approved for Sec. Sec.  1037.528 introductory text, (a), (b), (c), (e), 
and (h) and 1037.665(a).
    (4) SAE J1594, Vehicle Aerodynamics Terminology, Revised July 2010, 
(``SAE J1594''), IBR approved for Sec.  1037.530(d).
    (5) SAE J2071, Aerodynamic Testing of Road Vehicles--Open Throat 
Wind Tunnel Adjustment, Revised June 1994, (``SAE J2071''), IBR 
approved for Sec.  1037.530(b).
    (6) SAE J2263, Road Load Measurement Using Onboard Anemometry and 
Coastdown Techniques, Revised December 2008, (``SAE J2263''), IBR 
approved for Sec. Sec.  1037.528 introductory text, (a), (b), (d), and 
(f) and 1037.665(a).
    (7) SAE J2343, Recommended Practice for LNG Medium and Heavy-Duty 
Powered Vehicles, Revised July 2008, (``SAE J2343''), IBR approved for 
Sec.  1037.103(e).
    (8) SAE J2452, Stepwise Coastdown Methodology for Measuring Tire 
Rolling Resistance, Revised June 1999, (``SAE J2452''), IBR approved 
for Sec.  1037.528(h).
    (9) SAE J2966, Guidelines for Aerodynamic Assessment of Medium and 
Heavy Commercial Ground Vehicles Using Computational Fluid Dynamics, 
Issued September 2013, (``SAE J2966''), IBR approved for Sec.  
1037.532(a).


Sec.  1037.815  Confidential information.

    The provisions of 40 CFR 1068.10 apply for information you consider 
confidential.


Sec.  1037.820  Requesting a hearing.

    (a) You may request a hearing under certain circumstances, as 
described elsewhere in this part. To do this, you must file a written 
request, including a description of your objection and any supporting 
data, within 30 days after we make a decision.
    (b) For a hearing you request under the provisions of this part, we 
will approve your request if we find that your request raises a 
substantial factual issue.
    (c) If we agree to hold a hearing, we will use the procedures 
specified in 40 CFR part 1068, subpart G.


Sec.  1037.825  Reporting and recordkeeping requirements.

    (a) This part includes various requirements to submit and record 
data or other information. Unless we specify otherwise, store required 
records in any format and on any media and keep them readily available 
for eight years after you send an associated application for 
certification, or eight years after you generate the data if they do 
not support an application for certification. You may not rely on 
anyone else to meet recordkeeping requirements on your behalf unless we 
specifically authorize it. We may review these records at any time. You 
must promptly send us organized, written records in English if we ask 
for them. We may require you to submit written records in an electronic 
format.
    (b) The regulations in Sec.  1037.255 and 40 CFR 1068.25 and 
1068.101 describe your obligation to report truthful and complete 
information. This includes information not related to certification. 
Failing to properly report information and keep the records we specify 
violates 40 CFR 1068.101(a)(2), which may involve civil or criminal 
penalties.
    (c) Send all reports and requests for approval to the Designated 
Compliance Officer (see Sec.  1037.801).
    (d) Any written information we require you to send to or receive 
from another company is deemed to be a required record under this 
section. Such records are also deemed to be submissions to EPA. Keep 
these records for eight years unless the regulations specify a 
different period. We may require you to send us these records whether 
or not you are a certificate holder.
    (e) Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq), the 
Office of Management and Budget approves the reporting and 
recordkeeping specified in the applicable regulations. The following 
items illustrate the kind of reporting and recordkeeping we require for 
vehicles regulated under this part:
    (1) We specify the following requirements related to vehicle 
certification in this part 1037:
    (i) In Sec.  1036.150 we include various reporting and 
recordkeeping requirements related to interim provisions.
    (ii) In subpart C of this part we identify a wide range of 
information required to certify vehicles.
    (iii) In subpart G of this part we identify several reporting and 
recordkeeping items for making demonstrations and getting approval 
related to various special compliance provisions.
    (iv) In Sec.  1037.725, 1037.730, and 1037.735 we specify certain 
records related to averaging, banking, and trading.
    (2) We specify the following requirements related to testing in 40 
CFR part 1066:
    (i) In 40 CFR 1066.2 we give an overview of principles for 
reporting information.
    (ii) In 40 CFR 1066.25 we establish basic guidelines for storing 
test information.
    (iii) In 40 CFR 1066.695 we identify the specific information and 
data items to record when measuring emissions.
    (3) We specify the following requirements related to the general 
compliance provisions in 40 CFR part 1068:
    (i) In 40 CFR 1068.5 we establish a process for evaluating good 
engineering judgment related to testing and certification.
    (ii) In 40 CFR 1068.25 we describe general provisions related to 
sending and keeping information.
    (iii) In 40 CFR 1068.27 we require manufacturers to make engines 
and vehicles available for our testing or inspection if we make such a 
request.
    (iv) In 40 CFR 1068.105 we require vehicle manufacturers to keep 
certain records related to duplicate labels from engine manufacturers.
    (v) In 40 CFR 1068.120 we specify recordkeeping related to 
rebuilding engines.
    (vi) In 40 CFR part 1068, subpart C, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to various exemptions.
    (vii) In 40 CFR part 1068, subpart D, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to importing engines and vehicles.
    (viii) In 40 CFR 1068.450 and 1068.455 we specify certain records

[[Page 74128]]

related to testing production-line engines and vehicles in a selective 
enforcement audit.
    (ix) In 40 CFR 1068.501 we specify certain records related to 
investigating and reporting emission-related defects.
    (x) In 40 CFR 1068.525 and 1068.530 we specify certain records 
related to recalling nonconforming engines and vehicles.
    (xi) In 40 CFR part 1068, subpart G, we specify certain records for 
requesting a hearing.

Appendix I to Part 1037 -- Heavy-Duty Transient Test Cycle

------------------------------------------------------------------------
                       Time (sec)                          Speed (mi/hr)
------------------------------------------------------------------------
1.......................................................            0.00
2.......................................................            0.00
3.......................................................            0.00
4.......................................................            0.00
5.......................................................            0.00
6.......................................................            0.00
7.......................................................            0.41
8.......................................................            1.18
9.......................................................            2.26
10......................................................            3.19
11......................................................            3.97
12......................................................            4.66
13......................................................            5.32
14......................................................            5.94
15......................................................            6.48
16......................................................            6.91
17......................................................            7.28
18......................................................            7.64
19......................................................            8.02
20......................................................            8.36
21......................................................            8.60
22......................................................            8.74
23......................................................            8.82
24......................................................            8.82
25......................................................            8.76
26......................................................            8.66
27......................................................            8.58
28......................................................            8.52
29......................................................            8.46
30......................................................            8.38
31......................................................            8.31
32......................................................            8.21
33......................................................            8.11
34......................................................            8.00
35......................................................            7.94
36......................................................            7.94
37......................................................            7.80
38......................................................            7.43
39......................................................            6.79
40......................................................            5.81
41......................................................            4.65
42......................................................            3.03
43......................................................            1.88
44......................................................            1.15
45......................................................            1.14
46......................................................            1.12
47......................................................            1.11
48......................................................            1.19
49......................................................            1.57
50......................................................            2.31
51......................................................            3.37
52......................................................            4.51
53......................................................            5.56
54......................................................            6.41
55......................................................            7.09
56......................................................            7.59
57......................................................            7.99
58......................................................            8.32
59......................................................            8.64
60......................................................            8.91
61......................................................            9.13
62......................................................            9.29
63......................................................            9.40
64......................................................            9.39
65......................................................            9.20
66......................................................            8.84
67......................................................            8.35
68......................................................            7.81
69......................................................            7.22
70......................................................            6.65
71......................................................            6.13
72......................................................            5.75
73......................................................            5.61
74......................................................            5.65
75......................................................            5.80
76......................................................            5.95
77......................................................            6.09
78......................................................            6.21
79......................................................            6.31
80......................................................            6.34
81......................................................            6.47
82......................................................            6.65
83......................................................            6.88
84......................................................            7.04
85......................................................            7.05
86......................................................            7.01
87......................................................            6.90
88......................................................            6.88
89......................................................            6.89
90......................................................            6.96
91......................................................            7.04
92......................................................            7.17
93......................................................            7.29
94......................................................            7.39
95......................................................            7.48
96......................................................            7.57
97......................................................            7.61
98......................................................            7.59
99......................................................            7.53
100.....................................................            7.46
101.....................................................            7.40
102.....................................................            7.39
103.....................................................            7.38
104.....................................................            7.37
105.....................................................            7.37
106.....................................................            7.39
107.....................................................            7.42
108.....................................................            7.43
109.....................................................            7.40
110.....................................................            7.39
111.....................................................            7.42
112.....................................................            7.50
113.....................................................            7.57
114.....................................................            7.60
115.....................................................            7.60
116.....................................................            7.61
117.....................................................            7.64
118.....................................................            7.68
119.....................................................            7.74
120.....................................................            7.82
121.....................................................            7.90
122.....................................................            7.96
123.....................................................            7.99
124.....................................................            8.02
125.....................................................            8.01
126.....................................................            7.87
127.....................................................            7.59
128.....................................................            7.20
129.....................................................            6.52
130.....................................................            5.53
131.....................................................            4.36
132.....................................................            3.30
133.....................................................            2.50
134.....................................................            1.94
135.....................................................            1.56
136.....................................................            0.95
137.....................................................            0.42
138.....................................................            0.00
139.....................................................            0.00
140.....................................................            0.00
141.....................................................            0.00
142.....................................................            0.00
143.....................................................            0.00
144.....................................................            0.00
145.....................................................            0.00
146.....................................................            0.00
147.....................................................            0.00
148.....................................................            0.00
149.....................................................            0.00
150.....................................................            0.00
151.....................................................            0.00
152.....................................................            0.00
153.....................................................            0.00
154.....................................................            0.00
155.....................................................            0.00
156.....................................................            0.00
157.....................................................            0.00
158.....................................................            0.00
159.....................................................            0.00
160.....................................................            0.00
161.....................................................            0.00
162.....................................................            0.00
163.....................................................            0.00
164.....................................................            0.00
165.....................................................            0.00
166.....................................................            0.00
167.....................................................            0.00
168.....................................................            0.00
169.....................................................            0.00
170.....................................................            0.00
171.....................................................            0.00
172.....................................................            1.11
173.....................................................            2.65
174.....................................................            4.45
175.....................................................            5.68
176.....................................................            6.75
177.....................................................            7.59
178.....................................................            7.75
179.....................................................            7.63
180.....................................................            7.67
181.....................................................            8.70
182.....................................................           10.20
183.....................................................           11.92
184.....................................................           12.84
185.....................................................           13.27
186.....................................................           13.38
187.....................................................           13.61
188.....................................................           14.15
189.....................................................           14.84
190.....................................................           16.49
191.....................................................           18.33
192.....................................................           20.36
193.....................................................           21.47
194.....................................................           22.35
195.....................................................           22.96
196.....................................................           23.46
197.....................................................           23.92
198.....................................................           24.42
199.....................................................           24.99
200.....................................................           25.91
201.....................................................           26.26

[[Page 74129]]

 
202.....................................................           26.38
203.....................................................           26.26
204.....................................................           26.49
205.....................................................           26.76
206.....................................................           27.07
207.....................................................           26.64
208.....................................................           25.99
209.....................................................           24.77
210.....................................................           24.04
211.....................................................           23.39
212.....................................................           22.73
213.....................................................           22.16
214.....................................................           21.66
215.....................................................           21.39
216.....................................................           21.43
217.....................................................           20.67
218.....................................................           17.98
219.....................................................           13.15
220.....................................................            7.71
221.....................................................            3.30
222.....................................................            0.88
223.....................................................            0.00
224.....................................................            0.00
225.....................................................            0.00
226.....................................................            0.00
227.....................................................            0.00
228.....................................................            0.00
229.....................................................            0.00
230.....................................................            0.00
231.....................................................            0.00
232.....................................................            0.00
233.....................................................            0.00
234.....................................................            0.00
235.....................................................            0.00
236.....................................................            0.00
237.....................................................            0.00
238.....................................................            0.00
239.....................................................            0.00
240.....................................................            0.00
241.....................................................            0.00
242.....................................................            0.00
243.....................................................            0.00
244.....................................................            0.00
245.....................................................            0.00
246.....................................................            0.00
247.....................................................            0.00
248.....................................................            0.00
249.....................................................            0.00
250.....................................................            0.00
251.....................................................            0.00
252.....................................................            0.00
253.....................................................            0.00
254.....................................................            0.00
255.....................................................            0.00
256.....................................................            0.00
257.....................................................            0.00
258.....................................................            0.00
259.....................................................            0.50
260.....................................................            1.57
261.....................................................            3.07
262.....................................................            4.57
263.....................................................            5.65
264.....................................................            6.95
265.....................................................            8.05
266.....................................................            9.13
267.....................................................           10.05
268.....................................................           11.62
269.....................................................           12.92
270.....................................................           13.84
271.....................................................           14.38
272.....................................................           15.64
273.....................................................           17.14
274.....................................................           18.21
275.....................................................           18.90
276.....................................................           19.44
277.....................................................           20.09
278.....................................................           21.89
279.....................................................           24.15
280.....................................................           26.26
281.....................................................           26.95
282.....................................................           27.03
283.....................................................           27.30
284.....................................................           28.10
285.....................................................           29.44
286.....................................................           30.78
287.....................................................           32.09
288.....................................................           33.24
289.....................................................           34.46
290.....................................................           35.42
291.....................................................           35.88
292.....................................................           36.03
293.....................................................           35.84
294.....................................................           35.65
295.....................................................           35.31
296.....................................................           35.19
297.....................................................           35.12
298.....................................................           35.12
299.....................................................           35.04
300.....................................................           35.08
301.....................................................           35.04
302.....................................................           35.34
303.....................................................           35.50
304.....................................................           35.77
305.....................................................           35.81
306.....................................................           35.92
307.....................................................           36.23
308.....................................................           36.42
309.....................................................           36.65
310.....................................................           36.26
311.....................................................           36.07
312.....................................................           35.84
313.....................................................           35.96
314.....................................................           36.00
315.....................................................           35.57
316.....................................................           35.00
317.....................................................           34.08
318.....................................................           33.39
319.....................................................           32.20
320.....................................................           30.32
321.....................................................           28.48
322.....................................................           26.95
323.....................................................           26.18
324.....................................................           25.38
325.....................................................           24.77
326.....................................................           23.46
327.....................................................           22.39
328.....................................................           20.97
329.....................................................           20.09
330.....................................................           18.90
331.....................................................           18.17
332.....................................................           16.48
333.....................................................           15.07
334.....................................................           12.23
335.....................................................           10.08
336.....................................................            7.71
337.....................................................            7.32
338.....................................................            8.63
339.....................................................           10.77
340.....................................................           12.65
341.....................................................           13.88
342.....................................................           15.03
343.....................................................           15.64
344.....................................................           16.99
345.....................................................           17.98
346.....................................................           19.13
347.....................................................           18.67
348.....................................................           18.25
349.....................................................           18.17
350.....................................................           18.40
351.....................................................           19.63
352.....................................................           20.32
353.....................................................           21.43
354.....................................................           21.47
355.....................................................           21.97
356.....................................................           22.27
357.....................................................           22.69
358.....................................................           23.15
359.....................................................           23.69
360.....................................................           23.96
361.....................................................           24.27
362.....................................................           24.34
363.....................................................           24.50
364.....................................................           24.42
365.....................................................           24.38
366.....................................................           24.31
367.....................................................           24.23
368.....................................................           24.69
369.....................................................           25.11
370.....................................................           25.53
371.....................................................           25.38
372.....................................................           24.58
373.....................................................           23.77
374.....................................................           23.54
375.....................................................           23.50
376.....................................................           24.15
377.....................................................           24.30
378.....................................................           24.15
379.....................................................           23.19
380.....................................................           22.50
381.....................................................           21.93
382.....................................................           21.85
383.....................................................           21.55
384.....................................................           21.89
385.....................................................           21.97
386.....................................................           21.97
387.....................................................           22.01
388.....................................................           21.85
389.....................................................           21.62
390.....................................................           21.62
391.....................................................           22.01
392.....................................................           22.81
393.....................................................           23.54
394.....................................................           24.38
395.....................................................           24.80
396.....................................................           24.61
397.....................................................           23.12
398.....................................................           21.62
399.....................................................           19.90
400.....................................................           18.86
401.....................................................           17.79
402.....................................................           17.25
403.....................................................           16.91
404.....................................................           16.75
405.....................................................           16.75
406.....................................................           16.87
407.....................................................           16.37
408.....................................................           16.37
409.....................................................           16.49
410.....................................................           17.21
411.....................................................           17.41
412.....................................................           17.37
413.....................................................           16.87
414.....................................................           16.72
415.....................................................           16.22
416.....................................................           15.76
417.....................................................           14.72
418.....................................................           13.69
419.....................................................           12.00
420.....................................................           10.43

[[Page 74130]]

 
421.....................................................            8.71
422.....................................................            7.44
423.....................................................            5.71
424.....................................................            4.22
425.....................................................            2.30
426.....................................................            1.00
427.....................................................            0.00
428.....................................................            0.61
429.....................................................            1.19
430.....................................................            1.61
431.....................................................            1.53
432.....................................................            2.34
433.....................................................            4.29
434.....................................................            7.25
435.....................................................           10.20
436.....................................................           12.46
437.....................................................           14.53
438.....................................................           16.22
439.....................................................           17.87
440.....................................................           19.74
441.....................................................           21.01
442.....................................................           22.23
443.....................................................           22.62
444.....................................................           23.61
445.....................................................           24.88
446.....................................................           26.15
447.....................................................           26.99
448.....................................................           27.56
449.....................................................           28.18
450.....................................................           28.94
451.....................................................           29.83
452.....................................................           30.78
453.....................................................           31.82
454.....................................................           32.78
455.....................................................           33.24
456.....................................................           33.47
457.....................................................           33.31
458.....................................................           33.08
459.....................................................           32.78
460.....................................................           32.39
461.....................................................           32.13
462.....................................................           31.82
463.....................................................           31.55
464.....................................................           31.25
465.....................................................           30.94
466.....................................................           30.71
467.....................................................           30.56
468.....................................................           30.79
469.....................................................           31.13
470.....................................................           31.55
471.....................................................           31.51
472.....................................................           31.47
473.....................................................           31.44
474.....................................................           31.51
475.....................................................           31.59
476.....................................................           31.67
477.....................................................           32.01
478.....................................................           32.63
479.....................................................           33.39
480.....................................................           34.31
481.....................................................           34.81
482.....................................................           34.20
483.....................................................           32.39
484.....................................................           30.29
485.....................................................           28.56
486.....................................................           26.45
487.....................................................           24.79
488.....................................................           23.12
489.....................................................           20.73
490.....................................................           18.33
491.....................................................           15.72
492.....................................................           13.11
493.....................................................           10.47
494.....................................................            7.82
495.....................................................            5.70
496.....................................................            3.57
497.....................................................            0.92
498.....................................................            0.00
499.....................................................            0.00
500.....................................................            0.00
501.....................................................            0.00
502.....................................................            0.00
503.....................................................            0.00
504.....................................................            0.00
505.....................................................            0.00
506.....................................................            0.00
507.....................................................            0.00
508.....................................................            0.00
509.....................................................            0.00
510.....................................................            0.00
511.....................................................            0.00
512.....................................................            0.00
513.....................................................            0.00
514.....................................................            0.00
515.....................................................            0.00
516.....................................................            0.00
517.....................................................            0.00
518.....................................................            0.00
519.....................................................            0.00
520.....................................................            0.00
521.....................................................            0.00
522.....................................................            0.50
523.....................................................            1.50
524.....................................................            3.00
525.....................................................            4.50
526.....................................................            5.80
527.....................................................            6.52
528.....................................................            6.75
529.....................................................            6.44
530.....................................................            6.17
531.....................................................            6.33
532.....................................................            6.71
533.....................................................            7.40
534.....................................................            7.67
535.....................................................            7.33
536.....................................................            6.71
537.....................................................            6.41
538.....................................................            6.60
539.....................................................            6.56
540.....................................................            5.94
541.....................................................            5.45
542.....................................................            5.87
543.....................................................            6.71
544.....................................................            7.56
545.....................................................            7.59
546.....................................................            7.63
547.....................................................            7.67
548.....................................................            7.67
549.....................................................            7.48
550.....................................................            7.29
551.....................................................            7.29
552.....................................................            7.40
553.....................................................            7.48
554.....................................................            7.52
555.....................................................            7.52
556.....................................................            7.48
557.....................................................            7.44
558.....................................................            7.28
559.....................................................            7.21
560.....................................................            7.09
561.....................................................            7.06
562.....................................................            7.29
563.....................................................            7.75
564.....................................................            8.55
565.....................................................            9.09
566.....................................................           10.04
567.....................................................           11.12
568.....................................................           12.46
569.....................................................           13.00
570.....................................................           14.26
571.....................................................           15.37
572.....................................................           17.02
573.....................................................           18.17
574.....................................................           19.21
575.....................................................           20.17
576.....................................................           20.66
577.....................................................           21.12
578.....................................................           21.43
579.....................................................           22.66
580.....................................................           23.92
581.....................................................           25.42
582.....................................................           25.53
583.....................................................           26.68
584.....................................................           28.14
585.....................................................           30.06
586.....................................................           30.94
587.....................................................           31.63
588.....................................................           32.36
589.....................................................           33.24
590.....................................................           33.66
591.....................................................           34.12
592.....................................................           35.92
593.....................................................           37.72
594.....................................................           39.26
595.....................................................           39.45
596.....................................................           39.83
597.....................................................           40.18
598.....................................................           40.48
599.....................................................           40.75
600.....................................................           41.02
601.....................................................           41.36
602.....................................................           41.79
603.....................................................           42.40
604.....................................................           42.82
605.....................................................           43.05
606.....................................................           43.09
607.....................................................           43.24
608.....................................................           43.59
609.....................................................           44.01
610.....................................................           44.35
611.....................................................           44.55
612.....................................................           44.82
613.....................................................           45.05
614.....................................................           45.31
615.....................................................           45.58
616.....................................................           46.00
617.....................................................           46.31
618.....................................................           46.54
619.....................................................           46.61
620.....................................................           46.92
621.....................................................           47.19
622.....................................................           47.46
623.....................................................           47.54
624.....................................................           47.54
625.....................................................           47.54
626.....................................................           47.50
627.....................................................           47.50
628.....................................................           47.50
629.....................................................           47.31
630.....................................................           47.04
631.....................................................           46.77
632.....................................................           45.54
633.....................................................           43.24
634.....................................................           41.52
635.....................................................           39.79
636.....................................................           38.07
637.....................................................           36.34
638.....................................................           34.04
639.....................................................           32.45

[[Page 74131]]

 
640.....................................................           30.86
641.....................................................           28.83
642.....................................................           26.45
643.....................................................           24.27
644.....................................................           22.04
645.....................................................           19.82
646.....................................................           17.04
647.....................................................           14.26
648.....................................................           11.52
649.....................................................            8.78
650.....................................................            7.17
651.....................................................            5.56
652.....................................................            3.72
653.....................................................            3.38
654.....................................................            3.11
655.....................................................            2.58
656.....................................................            1.66
657.....................................................            0.67
658.....................................................            0.00
659.....................................................            0.00
660.....................................................            0.00
661.....................................................            0.00
662.....................................................            0.00
663.....................................................            0.00
664.....................................................            0.00
665.....................................................            0.00
666.....................................................            0.00
667.....................................................            0.00
668.....................................................            0.00
------------------------------------------------------------------------

Appendix II to Part 1037--Power Take-Off Test Cycle

----------------------------------------------------------------------------------------------------------------
                                                                                    Normalized      Normalized
                Cycle simulation                       Mode        Start time of     pressure,       pressure,
                                                                       mode        circuit 1 (%)   circuit 2 (%)
----------------------------------------------------------------------------------------------------------------
Utility.........................................               0               0             0.0             0.0
Utility.........................................               1              33            80.5             0.0
Utility.........................................               2              40             0.0             0.0
Utility.........................................               3             145            83.5             0.0
Utility.........................................               4             289             0.0             0.0
Refuse..........................................               5             361             0.0            13.0
Refuse..........................................               6             363             0.0            38.0
Refuse..........................................               7             373             0.0            53.0
Refuse..........................................               8             384             0.0            73.0
Refuse..........................................               9             388             0.0             0.0
Refuse..........................................              10             401             0.0            13.0
Refuse..........................................              11             403             0.0            38.0
Refuse..........................................              12             413             0.0            53.0
Refuse..........................................              13             424             0.0            73.0
Refuse..........................................              14             442            11.2             0.0
Refuse..........................................              15             468            29.3             0.0
Refuse..........................................              16             473             0.0             0.0
Refuse..........................................              17             486            11.2             0.0
Refuse..........................................              18             512            29.3             0.0
Refuse..........................................              19             517             0.0             0.0
Refuse..........................................              20             530            12.8            11.1
Refuse..........................................              21             532            12.8            38.2
Refuse..........................................              22             541            12.8            53.4
Refuse..........................................              23             550            12.8            73.5
Refuse..........................................              24             553             0.0             0.0
Refuse..........................................              25             566            12.8            11.1
Refuse..........................................              26             568            12.8            38.2
Refuse..........................................              27             577            12.8            53.4
Refuse..........................................              28             586            12.8            73.5
Refuse..........................................              29             589             0.0             0.0
Refuse..........................................              30             600             0.0             0.0
----------------------------------------------------------------------------------------------------------------

Appendix III to Part 1037--Emission Control Identifiers

    This appendix identifies abbreviations for emission control 
information labels, as required under Sec.  1037.135.

Vehicle Speed Limiters

--VSL--Vehicle speed limiter
--VSLS--``Soft-top'' vehicle speed limiter
--VSLE--Expiring vehicle speed limiter
--VSLD--Vehicle speed limiter with both ``soft-top'' and expiration

Idle Reduction Technology

--IRT5--Engine shutoff after 5 minutes or less of idling
--IRTE--Expiring engine shutoff

Tires

--LRRA--Low rolling resistance tires (all, including trailers)
--LRRD--Low rolling resistance tires (drive)
--LRRS--Low rolling resistance tires (steer)

Aerodynamic Components

--ATS--Aerodynamic side skirt and/or fuel tank fairing
--ARF--Aerodynamic roof fairing
--ARFR--Adjustable height aerodynamic roof fairing
--TGR--Gap reducing tractor fairing (tractor to trailer gap)
--TGRT--Gap reducing trailer fairing (tractor to trailer gap)
--TATS--Trailer aerodynamic side skirt
--TARF--Trailer aerodynamic rear fairing
--TAUD--Trailer aerodynamic underbody device

Other Components

--ADVH--Vehicle includes advanced hybrid technology components
--ADVO--Vehicle includes other advanced-technology components (i.e., 
non-hybrid system)
--INV--Vehicle includes innovative (off-cycle) technology components
--ATI--Automatic tire inflation system
--TPMS--Tire pressure monitoring system
--WRTW--Weight-reducing trailer wheels
--WRTC--Weight-reducing trailer upper coupler plate
--WRTS--Weight-reducing trailer axle sub-frames
--WBSW--Wide-base single trailer tires with steel wheel
--WBAW--Wide-base single trailer tires with aluminum wheel
--WBLW--Wide-base single trailer tires with light-weight aluminum 
alloy wheel
--DWSW--Dual-wide trailer tires with steel wheel
--DWAW--Dual-wide trailer tires with aluminum wheel
--DWLW--Dual-wide trailer tires with light-weight aluminum alloy 
wheel

[[Page 74132]]

Appendix IV to Part 1037--Heavy-Duty Grade Profile for Phase 2 Steady-
State Test Cycles

    The following table identifies a grade profile for operating 
vehicles over the highway cruise cycles specified in subpart F of 
this part. Determine intermediate values by linear interpolation.

------------------------------------------------------------------------
                      Distance (m)                           Grade (%)
------------------------------------------------------------------------
0.......................................................               0
808.....................................................               0
820.....................................................            -0.1
832.....................................................               0
842.....................................................               0
892.....................................................            0.36
942.....................................................               0
952.....................................................               0
1006....................................................           -0.28
1102....................................................           -1.04
1198....................................................           -0.28
1252....................................................               0
1264....................................................               0
1390....................................................            0.39
1458....................................................            0.66
1534....................................................            1.15
1696....................................................            2.44
1858....................................................            1.15
1934....................................................            0.66
2002....................................................            0.39
2128....................................................               0
2146....................................................               0
2330....................................................           -0.46
2398....................................................           -0.69
2478....................................................           -1.08
2546....................................................           -1.53
2698....................................................           -2.75
2850....................................................           -1.53
2918....................................................           -1.08
2998....................................................           -0.69
3066....................................................           -0.46
3250....................................................               0
3264....................................................               0
3340....................................................            0.35
3416....................................................             0.9
3502....................................................            1.59
3588....................................................             0.9
3664....................................................            0.35
3740....................................................               0
3756....................................................               0
3822....................................................            -0.1
4094....................................................           -0.69
4176....................................................           -0.97
4262....................................................           -1.36
4330....................................................           -1.78
4514....................................................           -3.23
4698....................................................           -1.78
4766....................................................           -1.36
4852....................................................           -0.97
4934....................................................           -0.69
5206....................................................            -0.1
5272....................................................               0
5322....................................................               0
5406....................................................             0.1
5498....................................................            0.17
5720....................................................            0.38
5912....................................................            0.58
6052....................................................            0.77
6226....................................................            1.09
6312....................................................            1.29
6436....................................................            1.66
6562....................................................            2.14
6638....................................................            2.57
6710....................................................               3
6762....................................................            3.27
6800....................................................            3.69
6890....................................................            5.01
6980....................................................            3.69
7018....................................................            3.27
7070....................................................               3
7142....................................................            2.57
7218....................................................            2.14
7344....................................................            1.66
7468....................................................            1.29
7554....................................................            1.09
7728....................................................            0.77
7868....................................................            0.58
8060....................................................            0.38
8282....................................................            0.17
8374....................................................             0.1
8458....................................................               0
8502....................................................               0
8608....................................................           -0.38
8668....................................................           -0.69
8852....................................................           -2.13
9036....................................................           -0.69
9096....................................................           -0.38
9202....................................................               0
9214....................................................               0
9262....................................................            0.26
9316....................................................             0.7
9370....................................................            0.26
9418....................................................               0
9428....................................................               0
9496....................................................           -0.34
9622....................................................           -1.33
9748....................................................           -0.34
9816....................................................               0
9826....................................................               0
9914....................................................            0.37
9968....................................................             0.7
10112...................................................            1.85
10256...................................................             0.7
10310...................................................            0.37
10398...................................................               0
10410...................................................               0
10498...................................................           -0.37
10552...................................................            -0.7
10696...................................................           -1.85
10840...................................................            -0.7
10894...................................................           -0.37
10982...................................................               0
10992...................................................               0
11060...................................................            0.34
11186...................................................            1.33
11312...................................................            0.34
11380...................................................               0
11390...................................................               0
11438...................................................           -0.26
11492...................................................            -0.7
11546...................................................           -0.26
11594...................................................               0
11606...................................................               0
11712...................................................            0.38
11772...................................................            0.69
11956...................................................            2.13
12140...................................................            0.69
12200...................................................            0.38
12306...................................................               0
12350...................................................               0
12434...................................................            -0.1
12526...................................................           -0.17
12748...................................................           -0.38
12940...................................................           -0.58
13080...................................................           -0.77
13254...................................................           -1.09
13340...................................................           -1.29
13464...................................................           -1.66
13590...................................................           -2.14
13666...................................................           -2.57
13738...................................................              -3
13790...................................................           -3.27
13828...................................................           -3.69
13918...................................................           -5.01
14008...................................................           -3.69
14046...................................................           -3.27
14098...................................................              -3
14170...................................................           -2.57
14246...................................................           -2.14
14372...................................................           -1.66
14496...................................................           -1.29
14582...................................................           -1.09
14756...................................................           -0.77
14896...................................................           -0.58
15088...................................................           -0.38
15310...................................................           -0.17
15402...................................................            -0.1
15486...................................................               0
15536...................................................               0
15602...................................................             0.1
15874...................................................            0.69
15956...................................................            0.97
16042...................................................            1.36
16110...................................................            1.78
16294...................................................            3.23
16478...................................................            1.78
16546...................................................            1.36
16632...................................................            0.97
16714...................................................            0.69
16986...................................................             0.1
17052...................................................               0
17068...................................................               0
17144...................................................           -0.35
17220...................................................            -0.9
17306...................................................           -1.59
17392...................................................            -0.9
17468...................................................           -0.35
17544...................................................               0
17558...................................................               0
17742...................................................            0.46
17810...................................................            0.69
17890...................................................            1.08
17958...................................................            1.53
18110...................................................            2.75
18262...................................................            1.53
18330...................................................            1.08
18410...................................................            0.69
18478...................................................            0.46
18662...................................................               0
18680...................................................               0
18806...................................................           -0.39
18874...................................................           -0.66
18950...................................................           -1.15
19112...................................................           -2.44
19274...................................................           -1.15
19350...................................................           -0.66
19418...................................................           -0.39
19544...................................................               0
19556...................................................               0
19610...................................................            0.28
19706...................................................            1.04
19802...................................................            0.28
19856...................................................               0
19866...................................................               0
19916...................................................           -0.36
19966...................................................               0
19976...................................................               0
19988...................................................             0.1
20000...................................................               0

[[Page 74133]]

 
20808...................................................               0
------------------------------------------------------------------------

Appendix V to Part 1037--Power Take-Off Utility Factors

------------------------------------------------------------------------
                                                          Utility factor
                       Time (min)                            fraction
------------------------------------------------------------------------
0.......................................................               0
10......................................................             0.1
20......................................................            0.18
30......................................................            0.24
40......................................................            0.31
50......................................................            0.36
60......................................................             0.4
70......................................................            0.44
80......................................................            0.47
90......................................................            0.51
100.....................................................            0.54
110.....................................................            0.57
120.....................................................             0.6
130.....................................................            0.64
140.....................................................            0.66
150.....................................................            0.69
160.....................................................            0.71
170.....................................................            0.74
180.....................................................            0.76
190.....................................................            0.77
200.....................................................            0.79
210.....................................................             0.8
220.....................................................            0.82
230.....................................................            0.83
240.....................................................            0.85
250.....................................................            0.86
260.....................................................            0.87
270.....................................................            0.88
280.....................................................            0.88
290.....................................................            0.89
300.....................................................             0.9
310.....................................................             0.9
320.....................................................            0.91
330.....................................................            0.92
340.....................................................            0.93
350.....................................................            0.93
360.....................................................            0.94
370.....................................................            0.95
380.....................................................            0.95
390.....................................................            0.96
420.....................................................            0.96
430.....................................................            0.97
460.....................................................            0.97
470.....................................................            0.98
520.....................................................            0.98
530.....................................................            0.99
580.....................................................            0.99
590.....................................................               1
------------------------------------------------------------------------

PART 1039--CONTROL OF EMISSIONS FROM NEW AND IN-USE NONROAD 
COMPRESSION-IGNITION ENGINES

0
139. The authority citation for part 1039 continues to read as follows:

    Authority:  42 U.S.C. 7401-7671q.

Subpart A--Overview and Applicability

0
140. Section 1039.2 is revised to read as follows:


Sec.  1039.2  Who is responsible for compliance?

    The regulations in this part 1039 contain provisions that affect 
both manufacturers and others. However, the requirements of this part 
are generally addressed to the manufacturer. The term ``you'' generally 
means the manufacturer, as defined in Sec.  1039.801, especially for 
issues related to certification. Note that for engines that become new 
after being placed into service (such as engines converted from highway 
or stationary use), the requirements that normally apply for 
manufacturers of freshly manufactured engines apply to the importer or 
any other entity we allow to obtain a certificate of conformity.

0
141. Section 1039.5 is amended by revising the introductory text, 
adding paragraph (a)(2)(iii), and revising paragraph (e) to read as 
follows:


Sec.  1039.5  Which engines are excluded from this part's requirements?

    This part does not apply to certain nonroad engines, as follows:
    (a) * * *
    (2) * * *
    (iii) Locomotive engines produced under the provisions of 40 CFR 
1033.625.
* * * * *
    (e) Engines used in recreational vehicles. Engines certified to 
meet the requirements of 40 CFR part 1051 are not subject to the 
provisions of this part 1039.

0
142. Section 1039.30 is revised to read as follows:


Sec.  1039.30  Submission of information.

    Unless we specify otherwise, send all reports and requests for 
approval to the Designated Compliance Officer (see Sec.  1039.801). See 
Sec.  1039.825 for additional reporting and recordkeeping provisions.

Subpart B--Emission Standards and Related Requirements

0
143. Section 1039.101 is amended by revising paragraph (f) to read as 
follows:


Sec.  1039.101  What exhaust emission standards must my engines meet 
after the 2014 model year?

* * * * *
    (f) Fuel types. The exhaust emission standards in this section 
apply for engines using the fuel type on which the engines in the 
engine family are designed to operate, except for engines certified 
under Sec.  1039.615. For engines certified under Sec.  1039.615, the 
standards of this section apply to emissions measured using the 
specified test fuel. You must meet the numerical emission standards for 
NMHC in this section based on the following types of hydrocarbon 
emissions for engines powered by the following fuels:
    (1) Alcohol-fueled engines: THCE emissions.
    (2) Gaseous-fueled engines: Nonmethane-nonethane hydrocarbon 
emissions.
    (3) Other engines: NMHC emissions.
* * * * *

0
144. Section 1039.102 is amended by revising paragraph (e)(3) to read 
as follows:


Sec.  1039.102  What exhaust emission standards and phase-in allowances 
apply for my engines in model year 2014 and earlier?

* * * * *
    (e) * * *
    (3) You may use NOX +NMHC emission credits to certify an 
engine family to the alternate NOX +NMHC standards in this 
paragraph (e)(3) instead of the otherwise applicable alternate 
NOX and NMHC standards. Calculate the alternate 
NOX +NMHC standard by adding 0.1 g/kW-hr to the numerical 
value of the applicable alternate NOX standard of paragraph 
(e)(1) or (2) of this section. Engines certified to the NOX 
+NMHC standards of this paragraph (e)(3) may not generate emission 
credits. The FEL caps for engine families certified under this 
paragraph (e)(3) are the previously applicable NOX +NMHC 
standards of 40 CFR 89.112 (generally the Tier 3 standards).
* * * * *

0
145. Section 1039.104 is amended by revising paragraph (g)(5) and 
adding paragraph (i) to read as follows:


Sec.  1039.104  Are there interim provisions that apply only for a 
limited time?

* * * * *
    (g) * * *
    (5) You may certify engines under this paragraph (g) in any model 
year provided for in Table 1 of this section without regard to whether 
or not the engine family's FEL is at or below the otherwise applicable 
FEL cap. For example, a 200 kW engine certified to the NOX + 
NMHC standard of Sec.  1039.102(e)(3) with an FEL equal to the FEL cap 
of 4.0 g/kW-hr may nevertheless be certified under this paragraph (g).
* * * * *
    (i) Lead time for diagnostic controls. Model year 2017 and earlier 
engines are not subject to the requirements for diagnostic controls as 
specified in Sec.  1039.110.

[[Page 74134]]


0
146. Section 1039.107 is amended by revising paragraph (b)(2) to read 
as follows:


Sec.  1039.107  What evaporative emission standards and requirements 
apply?

* * * * *
    (b) * * *
    (2) Present test data to show that equipment using your engines 
meets the evaporative emission standards we specify in this section if 
you do not use design-based certification under 40 CFR 1048.245.

0
147. Section 1039.110 is added to subpart B to read as follows:


Sec.  1039.110  Recording reductant use and other diagnostic functions.

    (a) Engines equipped with SCR systems using a reductant other than 
the engine's fuel must have a diagnostic system that monitors reductant 
quality and tank levels and alert operators to the need to refill the 
reductant tank before it is empty, or to replace the reductant if it 
does not meet your concentration specifications. Unless we approve 
other alerts, use a warning lamp or an audible alarm. You do not need 
to separately monitor reductant quality if your system uses input from 
an exhaust NOX sensor (or other sensor) to alert operators 
when reductant quality is inadequate. However, tank level must be 
monitored in all cases.
    (b) You may equip your engine with other diagnostic features. If 
you do, they must be designed to allow us to read and interpret the 
codes. Note that Sec.  1039.205 requires you to provide us any 
information needed to read, record, and interpret all the information 
broadcast by an engine's onboard computers and electronic control 
units.

0
148. Section 1039.120 is amended by revising paragraph (b) introductory 
text to read as follows:


Sec.  1039.120  What emission-related warranty requirements apply to 
me?

* * * * *
    (b) Warranty period. Your emission-related warranty must be valid 
for at least as long as the minimum warranty periods listed in this 
paragraph (b) in hours of operation and years, whichever comes first. 
You may offer an emission-related warranty more generous than we 
require. The emission-related warranty for the engine may not be 
shorter than any basic mechanical warranty you provide without charge 
for the engine. Similarly, the emission-related warranty for any 
component may not be shorter than any warranty you provide without 
charge for that component. This means that your warranty may not treat 
emission-related and nonemission-related defects differently for any 
component. If an engine has no hour meter, we base the warranty periods 
in this paragraph (b) only on the engine's age (in years). The warranty 
period begins when the engine is placed into service. The minimum 
warranty periods are shown in the following table:
* * * * *

0
149. Section 1039.125 is amended by revising paragraphs (a)(2)(i), 
(a)(3)(i), (a)(4), (c), (e), and (f) introductory text to read as 
follows:


Sec.  1039.125  What maintenance instructions must I give to buyers?

* * * * *
    (a) * * *
    (2) * * *
    (i) For EGR-related filters and coolers, DEF filters, crankcase 
ventilation valves and filters, and fuel injector tips (cleaning only), 
the minimum interval is 1,500 hours.
* * * * *
    (3) * * *
    (i) For EGR-related filters and coolers, DEF filters, crankcase 
ventilation valves and filters, and fuel injector tips (cleaning only), 
the minimum interval is 1,500 hours.
* * * * *
    (4) For particulate traps, trap oxidizers, and components related 
to either of these, scheduled maintenance may include cleaning or 
repair at the intervals specified in paragraph (a)(2)(ii) or (a)(3)(ii) 
of this section, as applicable. Scheduled maintenance may include a 
shorter interval for cleaning or repair and may also include adjustment 
or replacement, but only if we approve it. We will approve your request 
if you provide the maintenance free of charge and clearly state this in 
your maintenance instructions, and you provide us additional 
information as needed to convince us that the maintenance will occur.
* * * * *
    (c) Special maintenance. You may specify more frequent maintenance 
to address problems related to special situations, such as atypical 
engine operation. You must clearly state that this additional 
maintenance is associated with the special situation you are 
addressing. You may also address maintenance of low-use engines (such 
as recreational or stand-by engines) by specifying the maintenance 
interval in terms of calendar months or years in addition to your 
specifications in terms of engine operating hours. All special 
maintenance instructions must be consistent with good engineering 
judgment. We may disapprove your maintenance instructions if we 
determine that you have specified special maintenance steps to address 
maintenance that is unlikely to occur in use, or engine operation that 
is not atypical. For example, this paragraph (c) does not allow you to 
design engines that require special maintenance for a certain type of 
expected operation. If we determine that certain maintenance items do 
not qualify as special maintenance under this paragraph (c), you may 
identify this as recommended additional maintenance under paragraph (b) 
of this section.
* * * * *
    (e) Maintenance that is not emission-related. For maintenance 
unrelated to emission controls, you may schedule any amount of 
inspection or maintenance. You may also take these inspection or 
maintenance steps during service accumulation on your emission-data 
engines, as long as they are reasonable and technologically necessary. 
This might include adding engine oil, changing air, fuel, or oil 
filters, servicing engine-cooling systems or fuel-water separator 
cartridges or elements, and adjusting idle speed, governor, engine bolt 
torque, valve lash, or injector lash. You may not perform this 
nonemission-related maintenance on emission-data engines more often 
than the least frequent intervals that you recommend to the ultimate 
purchaser.
    (f) Source of parts and repairs. State clearly in your written 
maintenance instructions that a repair shop or person of the owner's 
choosing may maintain, replace, or repair emission-control devices and 
systems. Your instructions may not require components or service 
identified by brand, trade, or corporate name. Also, do not directly or 
indirectly condition your warranty on a requirement that the engine be 
serviced by your franchised dealers or any other service establishments 
with which you have a commercial relationship. You may disregard the 
requirements in this paragraph (f) if you do one of two things:
* * * * *

0
150. Section 1039.130 is amended by adding paragraph (b)(4) and 
revising paragraph (b)(5) to read as follows:


Sec.  1039.130  What installation instructions must I give to equipment 
manufacturers?

* * * * *
    (b) * * *
    (4) Describe any necessary steps for installing the diagnostic 
system described in Sec.  1039.110.
    (5) Describe how your certification is limited for any type of 
application. For example, if your engines are certified only for 
constant-speed operation, tell

[[Page 74135]]

equipment manufacturers not to install the engines in variable-speed 
applications.
* * * * *

0
151. Section 1039.135 is amended by revising paragraphs (b), (c)(2), 
and (d) to read as follows:


Sec.  1039.135  How must I label and identify the engines I produce?

* * * * *
    (b) At the time of manufacture, affix a permanent and legible label 
identifying each engine. The label must meet the requirements of 40 CFR 
1068.45.
    (c) * * *
    (2) Include your full corporate name and trademark. You may 
identify another company and use its trademark instead of yours if you 
comply with the branding provisions of 40 CFR 1068.45.
* * * * *
    (d) You may add information to the emission control information 
label as follows:
    (1) You may identify other emission standards that the engine meets 
or does not meet (such as international standards), as long as this 
does not cause you to omit any of the information described in 
paragraphs (c)(5) through (10) of this section. You may add the 
information about the other emission standards to the statement we 
specify, or you may include it in a separate statement.
    (2) You may add other information to ensure that the engine will be 
properly maintained and used.
    (3) You may add appropriate features to prevent counterfeit labels. 
For example, you may include the engine's unique identification number 
on the label.
* * * * *

Subpart C--Certifying Engine Families

0
152. Section 1039.201 is amended by revising paragraphs (a) and (g) to 
read as follows:


Sec.  1039.201  What are the general requirements for obtaining a 
certificate of conformity?

    (a) You must send us a separate application for a certificate of 
conformity for each engine family. A certificate of conformity is valid 
for new production from the indicated effective date until the end of 
the model year for which it is issued, which may not extend beyond 
December 31 of that year. No new certificate will be issued after 
December 31 of the model year. You may amend your application for 
certification after the end of the model year in certain circumstances 
as described in Sec. Sec.  1039.220 and 1039.225. You must renew your 
certification annually for any engines you continue to produce.
* * * * *
    (g) We may require you to deliver your test engines to a facility 
we designate for our testing (see Sec.  1039.235(c)). Alternatively, 
you may choose to deliver another engine that is identical in all 
material respects to the test engine, or another engine that we 
determine can appropriately serve as an emission-data engine for the 
engine family.
* * * * *

0
153. Section 1039.205 is amended by revising paragraph (r)(1) and 
adding paragraph (bb) to read as follows:


Sec.  1039.205  What must I include in my application?

* * * * *
    (r) * * *
    (1) Report all valid test results involving measurement of 
pollutants for which emission standards apply. Also indicate whether 
there are test results from invalid tests or from any other tests of 
the emission-data engine, whether or not they were conducted according 
to the test procedures of subpart F of this part. We may require you to 
report these additional test results. We may ask you to send other 
information to confirm that your tests were valid under the 
requirements of this part and 40 CFR part 1065.
* * * * *
    (bb) For imported engines or equipment, identify the following:
    (1) Describe your normal practice for importing engines. For 
example, this may include identifying the names and addresses of any 
agents you have authorized to import your engines.
    (2) For engines below 560 kW, identify a test facility in the 
United States where you can test your engines if we select them for 
testing under a selective enforcement audit, as specified in 40 CFR 
part 1068, subpart E.

0
154. Section 1039.220 is amended by revising the section heading as to 
read as follows:


Sec.  1039.220  How do I amend my maintenance instructions?

* * * * *

0
155. Section 1039.225 is amended by adding paragraphs (b)(4) and (g) to 
read as follows:


Sec.  1039.225  How do I amend my application for certification?

* * * * *
    (b) * * *
    (4) Include any other information needed to make your application 
correct and complete.
* * * * *
    (g) You may produce engines as described in your amended 
application for certification and consider those engines to be in a 
certified configuration if we approve a new or modified engine 
configuration during the model year under paragraph (d) of this 
section. Similarly, you may modify in-use engines as described in your 
amended application for certification and consider those engines to be 
in a certified configuration if we approve a new or modified engine 
configuration at any time under paragraph (d) of this section. 
Modifying a new or in-use engine to be in a certified configuration 
does not violate the tampering prohibition of 40 CFR 1068.101(b)(1), as 
long as this does not involve changing to a certified configuration 
with a higher family emission limit.

0
156. Section 1039.230 is amended by revising paragraph (b)(1) to read 
as follows:


Sec.  1039.230  How do I select engine families?

* * * * *
    (b) * * *
    (1) The combustion cycle and fuel. However, you do not need to 
separate dual-fuel and flexible-fuel engines into separate engine 
families.
* * * * *

0
157. Section 1039.235 is amended by revising paragraphs (a), (b), (c) 
introductory text, (c)(4), and (d)(1) to read as follows:


Sec.  1039.235  What testing requirements apply for certification?

* * * * *
    (a) Select an emission-data engine from each engine family for 
testing. Select the engine configuration with the highest volume of 
fuel injected per cylinder per combustion cycle at the point of maximum 
torque--unless good engineering judgment indicates that a different 
engine configuration is more likely to exceed (or have emissions nearer 
to) an applicable emission standard or FEL. If two or more engines have 
the same fueling rate at maximum torque, select the one with the 
highest fueling rate at rated speed. In making this selection, consider 
all factors expected to affect emission-control performance and 
compliance with the standards, including emission levels of all exhaust 
constituents, especially NOX and PM.
    (b) Test your emission-data engines using the procedures and 
equipment

[[Page 74136]]

specified in subpart F of this part. In the case of dual-fuel engines, 
measure emissions when operating with each type of fuel for which you 
intend to certify the engine. In the case of flexible-fuel engines, 
measure emissions when operating with the fuel mixture that best 
represents in-use operation or is most likely to have the highest 
NOX emissions (or NOX+NMHC emissions for engines 
subject to NOX+NMHC standards), though you may ask us 
instead to perform tests with both fuels separately if you can show 
that intermediate mixtures are not likely to occur in use.
    (c) We may perform confirmatory testing by measuring emissions from 
any of your emission-data engines or other engines from the engine 
family, as follows:
* * * * *
    (4) Before we test one of your engines, we may calibrate it within 
normal production tolerances for anything we do not consider an 
adjustable parameter. For example, this would apply for an engine 
parameter that is subject to production variability because it is 
adjustable during production, but is not considered an adjustable 
parameter (as defined in Sec.  1039.801) because it is permanently 
sealed. For parameters that relate to a level of performance that is 
itself subject to a specified range (such as maximum power output), we 
will generally perform any calibration under this paragraph (c)(4) in a 
way that keeps performance within the specified range.
    (d) * * *
    (1) The engine family from the previous model year differs from the 
current engine family only with respect to model year, items identified 
in Sec.  1039.225(a), or other characteristics unrelated to emissions. 
We may waive this criterion for differences we determine not to be 
relevant.
* * * * *

0
158. Section 1039.240 is amended by revising paragraphs (c) and (d) and 
removing paragraph (e).
    The revisions read as follows:


Sec.  1039.240  How do I demonstrate that my engine family complies 
with exhaust emission standards?

* * * * *
    (c) To compare emission levels from the emission-data engine with 
the applicable emission standards, apply deterioration factors to the 
measured emission levels for each pollutant. Section 1039.245 specifies 
how to test your engine to develop deterioration factors that represent 
the deterioration expected in emissions over your engines' full useful 
life. Your deterioration factors must take into account any available 
data from in-use testing with similar engines. Small-volume engine 
manufacturers may use assigned deterioration factors that we establish. 
Apply deterioration factors as follows:
    (1) Additive deterioration factor for exhaust emissions. Except as 
specified in paragraph (c)(2) of this section, use an additive 
deterioration factor for exhaust emissions. An additive deterioration 
factor is the difference between exhaust emissions at the end of the 
useful life and exhaust emissions at the low-hour test point. In these 
cases, adjust the official emission results for each tested engine at 
the selected test point by adding the factor to the measured emissions. 
If the factor is less than zero, use zero. Additive deterioration 
factors must be specified to one more decimal place than the applicable 
standard.
    (2) Multiplicative deterioration factor for exhaust emissions. Use 
a multiplicative deterioration factor if good engineering judgment 
calls for the deterioration factor for a pollutant to be the ratio of 
exhaust emissions at the end of the useful life to exhaust emissions at 
the low-hour test point. For example, if you use aftertreatment 
technology that controls emissions of a pollutant proportionally to 
engine-out emissions, it is often appropriate to use a multiplicative 
deterioration factor. Adjust the official emission results for each 
tested engine at the selected test point by multiplying the measured 
emissions by the deterioration factor. If the factor is less than one, 
use one. A multiplicative deterioration factor may not be appropriate 
in cases where testing variability is significantly greater than 
engine-to-engine variability. Multiplicative deterioration factors must 
be specified to one more significant figure than the applicable 
standard.
    (3) Sawtooth and other nonlinear deterioration patterns. The 
deterioration factors described in paragraphs (c)(1) and (2) of this 
section assume that the highest useful life emissions occur either at 
the end of useful life or at the low-hour test point. The provisions of 
this paragraph (c)(3) apply where good engineering judgment indicates 
that the highest emissions over the useful life will occur between 
these two points. For example, emissions may increase with service 
accumulation until a certain maintenance step is performed, then return 
to the low-hour emission levels and begin increasing again. Base 
deterioration factors for engines with such emission patterns on the 
difference between (or ratio of) the point at which the highest 
emissions occur and the low-hour test point. Note that this applies for 
maintenance-related deterioration only where we allow such critical 
emission-related maintenance.
    (4) Deterioration factor for smoke. Deterioration factors for smoke 
are always additive, as described in paragraph (c)(1) of this section.
    (5) Deterioration factor for crankcase emissions. If your engine 
vents crankcase emissions to the exhaust or to the atmosphere, you must 
account for crankcase emission deterioration, using good engineering 
judgment. You may use separate deterioration factors for crankcase 
emissions of each pollutant (either multiplicative or additive) or 
include the effects in combined deterioration factors that include 
exhaust and crankcase emissions together for each pollutant.
    (6) Dual-fuel and flexible-fuel engines. In the case of dual-fuel 
and flexible-fuel engines, apply deterioration factors separately for 
each fuel type. You may accumulate service hours on a single emission-
data engine using the type of fuel or the fuel mixture expected to have 
the highest combustion and exhaust temperatures; you may ask us to 
approve a different fuel mixture if you demonstrate that a different 
criterion is more appropriate.
    (d) Determine the official emission result for each pollutant to at 
least one more decimal place than the applicable standard. Apply the 
deterioration factor to the official emission result, as described in 
paragraph (c) of this section, then round the adjusted figure to the 
same number of decimal places as the emission standard. Compare the 
rounded emission levels to the emission standard for each emission-data 
engine. In the case of NOX+NMHC standards, apply the 
deterioration factor to each pollutant and then add the results before 
rounding.

0
159. Section 1039.250 is amended by revising paragraphs (b)(3)(iv) and 
(c) to read as follows:


Sec.  1039.250  What records must I keep and what reports must I send 
to EPA?

* * * * *
    (b) * * *
    (3) * * *
    (iv) All your emission tests, including the date and purpose of 
each test and documentation of test parameters as specified in part 40 
CFR part 1065.
* * * * *
    (c) Keep required data from emission tests and all other 
information specified in this section for eight years after we issue 
your certificate. If you use the same emission data or other 
information for a later model year, the eight-year

[[Page 74137]]

period restarts with each year that you continue to rely on the 
information.
* * * * *

0
160. Section 1039.255 is amended by revising paragraphs (c)(2) and (4), 
(d), and (e) to read as follows:


Sec.  1039.255  What decisions may EPA make regarding my certificate of 
conformity?

* * * * *
    (c) * * *
    (2) Submit false or incomplete information (paragraph (e) of this 
section applies if this is fraudulent). This includes doing anything 
after submission of your application to render any of the submitted 
information false or incomplete.
* * * * *
    (4) Deny us from completing authorized activities (see 40 CFR 
1068.20). This includes a failure to provide reasonable assistance.
* * * * *
    (d) We may void the certificate of conformity for an engine family 
if you fail to keep records, send reports, or give us information as 
required under this part or the Act. Note that these are also 
violations of 40 CFR 1068.101(a)(2).
    (e) We may void your certificate if we find that you intentionally 
submitted false or incomplete information. This includes rendering 
submitted information false or incomplete after submission.
* * * * *

Subpart F--Test Procedures

0
161. Section 1039.501 is amended by revising paragraphs (a), (e), (f), 
and (g) and adding paragraph (h) to read as follows:


Sec.  1039.501  How do I run a valid emission test?

    (a) Use the equipment and procedures for compression-ignition 
engines in 40 CFR part 1065 to determine whether engines meet the duty-
cycle emission standards in subpart B of this part. Measure the 
emissions of all the exhaust constituents subject to emission standards 
as specified in 40 CFR part 1065. Measure CO2, 
N2O, and CH4 as described in Sec.  1039.235. Use 
the applicable duty cycles specified in Sec. Sec.  1039.505 and 
1039.510.
* * * * *
    (e) The following provisions apply for engines using aftertreatment 
technology with infrequent regeneration events that may occur during 
testing:
    (1) Adjust measured emissions to account for aftertreatment 
technology with infrequent regeneration as described in Sec.  1039.525.
    (2) If your engine family includes engines with one or more 
emergency AECDs approved under Sec.  1039.115(g)(4) or (5), do not 
consider additional regenerations resulting from those AECDs when 
developing adjustments to measured values under this paragraph (e).
    (3) Invalidate a smoke test if active regeneration starts to occur 
during the test.
    (f) You may disable any AECDs that have been approved solely for 
emergency equipment applications under Sec.  1039.115(g)(4). Note that 
the emission standards do not apply when any of these AECDs are active.
    (g) You may use special or alternate procedures to the extent we 
allow them under 40 CFR 1065.10.
    (h) This subpart is addressed to you as a manufacturer, but it 
applies equally to anyone who does testing for you, and to us when we 
perform testing to determine if your engines meet emission standards.

0
162. Section 1039.505 is amended by revising paragraph (b)(2) to read 
as follows:


Sec.  1039.505  How do I test engines using steady-state duty cycles, 
including ramped-modal testing?

* * * * *
    (b) * * *
    (2) Use the 6-mode duty cycle or the corresponding ramped-modal 
cycle described in paragraph (b) of Appendix II of this part for 
variable-speed engines below 19 kW. You may instead use the 8-mode duty 
cycle or the corresponding ramped-modal cycle described in paragraph 
(c) of Appendix II of this part if some engines from your engine family 
will be used in applications that do not involve governing to maintain 
engine operation around rated speed.
* * * * *

0
163. Section 1039.515 is amended by revising paragraph (a) to read as 
follows:


Sec.  1039.515  What are the test procedures related to not-to-exceed 
standards?

    (a) General provisions. The provisions in 40 CFR 86.1370 apply for 
determining whether an engine meets the not-to-exceed emission 
standards in Sec.  1039.101(e), except as noted in this section. 
Interpret references to vehicles and vehicle operation to mean 
equipment and equipment operation.
* * * * *

0
164. Section 1039.525 is revised to read as follows:


Sec.  1039.525  How do I adjust emission levels to account for 
infrequently regenerating aftertreatment devices?

    For engines using aftertreatment technology with infrequent 
regeneration events that may occur during testing, take one of the 
following approaches to account for the emission impact of 
regeneration:
    (a) You may use the calculation methodology described in 40 CFR 
1065.680 to adjust measured emission results. Do this by developing an 
upward adjustment factor and a downward adjustment factor for each 
pollutant based on measured emission data and observed regeneration 
frequency as follows:
    (1) Adjustment factors should generally apply to an entire engine 
family, but you may develop separate adjustment factors for different 
configurations within an engine family. Use the adjustment factors from 
this section for all testing for the engine family.
    (2) You may use carryover or carry-across data to establish 
adjustment factors for an engine family as described in Sec.  1039.235, 
consistent with good engineering judgment.
    (3) For engines that are required to certify to both transient and 
steady-state duty cycles, calculate a separate adjustment factor for 
steady-state and transient operation.
    (b) You may ask us to approve an alternate methodology to account 
for regeneration events. We will generally limit approval to cases 
where your engines use aftertreatment technology with extremely 
infrequent regeneration and you are unable to apply the provisions of 
this section.
    (c) You may choose to make no adjustments to measured emission 
results if you determine that regeneration does not significantly 
affect emission levels for an engine family (or configuration) or if it 
is not practical to identify when regeneration occurs. If you choose 
not to make adjustments under paragraph (a) or (b) of this section, 
your engines must meet emission standards for all testing, without 
regard to regeneration.

Subpart G--Special Compliance Provisions

0
165. Section 1039.601 is revised to read as follows:


Sec.  1039.601  What compliance provisions apply?

    (a) Engine and equipment manufacturers, as well as owners, 
operators, and rebuilders of engines subject to the requirements of 
this part,

[[Page 74138]]

and all other persons, must observe the provisions of this part, the 
requirements and prohibitions in 40 CFR part 1068, and the provisions 
of the Act.
    (b) Subpart C of this part describes how to test and certify dual-
fuel and flexible-fuel engines. Some multi-fuel engines may not fit 
either of those defined terms. For such engines, we will determine 
whether it is most appropriate to treat them as single-fuel engines, 
dual-fuel engines, or flexible-fuel engines based on the range of 
possible and expected fuel mixtures. For example, an engine might burn 
natural gas but initiate combustion with a pilot injection of diesel 
fuel. If the engine is designed to operate with a single fueling 
algorithm (i.e., fueling rates are fixed at a given engine speed and 
load condition), we would generally treat it as a single-fuel engine, 
In this context, the combination of diesel fuel and natural gas would 
be its own fuel type. If the engine is designed to also operate on 
diesel fuel alone, we would generally treat it as a dual-fuel engine. 
If the engine is designed to operate on varying mixtures of the two 
fuels, we would generally treat it as a flexible-fuel engine. To the 
extent that requirements vary for the different fuels or fuel mixtures, 
we may apply the more stringent requirements.

0
166. Section 1039.605 is amended by revising paragraphs (b), (d)(5), 
and (d)(8) to read as follows:


Sec.  1039.605  What provisions apply to engines certified under the 
motor-vehicle program?

* * * * *
    (b) Equipment-manufacturer provisions. If you are not an engine 
manufacturer, you may install motor-vehi cle engines certified for the 
appropriate model year under 40 CFR part 86 in nonroad equipment as 
long as you meet all the requirements and conditions specified in 
paragraph (d) of this section. You must also add the fuel-inlet label 
we specify in Sec.  1039.135(e). If you modify the motor-vehicle engine 
in any of the ways described in paragraph (d)(2) of this section, we 
will consider you a manufacturer of a new nonroad engine. Such engine 
modifications prevent you from using the provisions of this section.
* * * * *
    (d) * * *
    (5) You must add a permanent supplemental label to the engine in a 
position where it will remain clearly visible after installation in the 
equipment. In the supplemental label, do the following:
    (i) Include the heading: ``NONROAD ENGINE EMISSION CONTROL 
INFORMATION''.
    (ii) Include your full corporate name and trademark. You may 
identify another company and use its trademark instead of yours if you 
comply with the branding provisions of 40 CFR 1068.45.
    (iii) State: ``THIS ENGINE WAS ADAPTED FOR NONROAD USE WITHOUT 
AFFECTING ITS EMISSION CONTROLS. THE EMISSION-CONTROL SYSTEM DEPENDS ON 
THE USE OF FUEL MEETING SPECIFICATIONS THAT APPLY FOR MOTOR-VEHICLE 
APPLICATIONS. OPERATING THE ENGINE ON OTHER FUELS MAY BE A VIOLATION OF 
FEDERAL LAW.''
    (iv) State the date you finished modifying the engine (month and 
year), if applicable.
* * * * *
    (8) Send the Designated Compliance Officer written notification 
describing your plans before using the provisions of this section. In 
addition, by February 28 of each calendar year (or less often if we 
tell you), send the Designated Compliance Oficer a signed letter with 
all the following information:
    (i) Identify your full corporate name, address, and telephone 
number.
    (ii) List the engine or equipment models for which you used this 
exemption in the previous year and describe your basis for meeting the 
sales restrictions of paragraph (d)(3) of this section.
    (iii) State: ``We prepared each listed [engine or equipment] model 
for nonroad application without making any changes that could increase 
its certified emission levels, as described in 40 CFR 1039.605.''
* * * * *

0
167. Section 1039.610 is amended by revising paragraphs (d)(5)(ii) and 
(d)(7) to read as follows:


Sec.  1039.610  What provisions apply to vehicles certified under the 
motor-vehicle program?

* * * * *
    (d) * * *
    (5) * * *
    (ii) Include your full corporate name and trademark. You may 
identify another company and use its trademark instead of yours if you 
comply with the branding provisions of 40 CFR 1068.45.
* * * * *
    (7) Send the Designated Compliance Officer written notification 
describing your plans before using the provisions of this section. In 
addition, by February 28 of each calendar year (or less often if we 
tell you), send the Designated Compliance Officer a signed letter with 
all the following information:
    (i) Identify your full corporate name, address, and telephone 
number.
    (ii) List the equipment models for which you used this exemption in 
the previous year and describe your basis for meeting the sales 
restrictions of paragraph (d)(3) of this section.
    (iii) State: ``We prepared each listed engine or equipment model 
for nonroad application without making any changes that could increase 
its certified emission levels, as described in 40 CFR 1039.610.''
* * * * *


Sec. Sec.  1039.640 and 1039.660  [Removed]

0
168. Sections 1039.640 and 1039.660 are removed.

0
169. A new Sec.  1039.699 is added to subpart G to read as follows:


Sec.  1039.699  Emission standards and certification requirements for 
auxiliary power units for highway tractors.

    (a) This section describes emission standards and certification 
requirements for auxiliary power units (APU) installed on highway 
tractors subject to standards under 40 CFR 1037.106 starting in model 
year 2024.
    (b) You may apply for a certificate of conformity under this 
section if you manufacture APUs, or if you install emission control 
hardware to meet the standard in this section.
    (c) Exhaust emissions may not exceed a PM standard of 0.02 g/kW-hr 
when tested using the steady-state test procedures described in subpart 
F of this part for the duty cycles specified in Sec.  1039.505(b)(1). 
Your APUs must meet the exhaust emission standards of this section over 
the engine's useful life as specified in Sec.  1039.101(g). These 
emission standards also apply for testing with production and in-use 
APUs.
    (d) The APU is deemed to have a valid certificate of conformity 
under this section if the engine manufacturer certifies the engine 
under 40 CFR part 1039 with a family emission limit of 0.02 g/kW-hr or 
less.
    (e) The APU may draw power from the installed engine to regenerate 
a particulate filter, but you must not make any other changes to the 
certified engine that could reasonably be expected to increase its 
emissions of any pollutant.
    (f) Sections 1039.115, 1039.120, 1039.125, and 1039.130 apply for 
APUs as written. You must exercise due diligence in ensuring that your 
system will not adversely affect safety or otherwise violate the 
prohibition of Sec.  1039.115(f).

[[Page 74139]]

    (g) All your APUs are considered to be part of a single emission 
family; however, you may subdivide your APUs into multiple emission 
families if you show the expected emission characteristics are 
different during the useful life.
    (h) Testing requirements apply for certification as follows:
    (1) Select an emission-data APU representing a worst-case condition 
for PM emissions. Measure emissions from the test engine with the APU 
installed according to your specifications.
    (2) We may require you to provide an engineering analysis showing 
that the performance of your emission controls will not deteriorate 
during the useful life with proper maintenance. If we determine that 
your emission controls are likely to deteriorate during the useful 
life, we may require you to develop and apply deterioration factors 
consistent with good engineering judgment.
    (3) Collect emission data and round to the nearest 0.01 g/kW-hr for 
comparing to the standard. Calculate full-life emissions as described 
in Sec.  1039.240(d) if you need to apply a deterioration factor.
    (4) You may ask to use emission data from a previous production 
period instead of doing new tests as described in Sec.  1039.235(d).
    (5) Additional testing provisions apply as described in Sec.  
1039.235(c), (e), and (f).
    (i) Your APU certificate is valid for any engine certified under 
this part 1039, as long as the engine has a maximum engine power no 
more than 10 percent greater than the maximum engine power of the 
engine used for certification testing under this section.
    (j) The following provisions apply for determining whether your APU 
complies with the requirements of this section:
    (1) For purposes of certification, your emission family is 
considered in compliance with the emission standards of this section if 
all emission-data APUs representing that family have test results 
showing compliance with the standards.
    (2) Your engine family is deemed not to comply if any emission-data 
APU representing that family for certification has test results showing 
a full-life emission level above the PM standard.
    (k) At the time of manufacture, affix a permanent and legible label 
identifying each APU. This applies even if the engine manufacturer 
certifies a compliant engine as described in paragraph (d) of this 
section. The label must meet the specifications described in 40 CFR 
1068.45(a). The label must--
    (1) Include the heading ``EMISSION CONTROL INFORMATION''.
    (2) Include your full corporate name and trademark.
    (3) State: ``THIS APU ENGINE COMPLIES WITH 40 CFR 1039.699.''
    (l) [Reserved]
    (m) See Sec. Sec.  1039.201, 1039.210, 1039.220, 1039.225, 
1039.250, and 1039.255 for general requirements related to obtaining a 
certificate of conformity. A certificate issued under this section may 
apply for a production period lasting up to five years. Include the 
following information in your application for certification, unless we 
ask you to include less information:
    (1) Describe the emission family's specifications and other basic 
parameters of the APU's design and emission controls. List each 
distinguishable configuration in the emission family. For each APU 
configuration, list the maximum engine power for which the APU is 
designed to operate.
    (2) Explain how the emission control system operates. Identify the 
part number of each component you describe.
    (3) Describe the engines you selected for testing and the reasons 
for selecting them.
    (4) Describe the test equipment and procedures that you used. Also 
describe any special or alternate test procedures you used.
    (5) Describe how you operated the emission-data APU before testing, 
including any operation to break in the APU or otherwise stabilize 
emission levels. Describe any scheduled maintenance you did.
    (6) List the specifications of the test fuel to show that it falls 
within the required ranges we specify in 40 CFR part 1065.
    (7) Include the maintenance and warranty instructions you will 
provide (see Sec. Sec.  1039.120 and 1039.125).
    (8) Describe your emission control information label.
    (9) Identify the emission family's deterioration factors and 
describe how you developed them, or summarize your analysis describing 
why you don't expect performance of emission controls to deteriorate. 
Present any emission test data you used for this.
    (10) State that you operated your emission-data APU as described in 
the application (including the test procedures, test parameters, and 
test fuels) to show you meet the requirements of this part.
    (11) Present emission data for PM.
    (12) Report all test results, including those from invalid tests, 
whether or not they were conducted according to the test procedures of 
subpart F of this part. We may ask you to send other information to 
confirm that your tests were valid under the requirements of this part 
and 40 CFR part 1065.
    (13) Describe any adjustable operating parameters as described in 
Sec.  1039.205(s).
    (14) Unconditionally certify that all the APUs in the emission 
family comply with the requirements of this part, other referenced 
parts of the CFR, and the Clean Air Act.
    (15) Provide additional information if we say we need it to 
evaluate your application.
    (16) Name an agent for service located in the United States. 
Service on this agent constitutes service on you or any of your 
officers or employees for any action by EPA or otherwise by the United 
States related to the requirements of this part.
    (n) If a highway tractor manufacturer violates 40 CFR 1037.106(g) 
by installing an APU from you that is not properly certified and 
labeled, you are presumed to have caused the violation (see 40 CFR 
1068.101(c)).

Subpart H--Averaging, Banking, and Trading for Certification

0
170. Section 1039.701 is amended by adding paragraph (h) to read as 
follows:


Sec.  1039.701  General provisions.

* * * * *
    (h) You may use either of the following approaches to retire or 
forego emission credits:
    (1) You may retire emission credits generated from any number of 
your engines. This may be considered donating emission credits to the 
environment. Identify any such credits in the reports described in 
Sec.  1039.730. Engines must comply with the applicable FELs even if 
you donate or sell the corresponding emission credits under this 
paragraph (h). Those credits may no longer be used by anyone to 
demonstrate compliance with any EPA emission standards.
    (2) You may certify a family using an FEL below the emission 
standard as described in this part and choose not to generate emission 
credits for that family. If you do this, you do not need to calculate 
emission credits for those families and you do not need to submit or 
keep the associated records described in this subpart for that family.

0
171. Section 1039.705 is amended by revising paragraphs (b), (c) 
introductory text, and (c)(1) to read as follows:


Sec.  1039.705  How do I generate and calculate emission credits?

* * * * *

[[Page 74140]]

    (b) For each participating family, calculate positive or negative 
emission credits relative to the otherwise applicable emission 
standard. Calculate positive emission credits for a family that has an 
FEL below the standard. Calculate negative emission credits for a 
family that has an FEL above the standard. Sum your positive and 
negative credits for the model year before rounding. Round the sum of 
emission credits to the nearest kilogram (kg), using consistent units 
throughout the following equation:

Emission credits (kg) = (Std-FEL) [ltarr8] (Volume) [ltarr8] (AvgPR) 
[ltarr8] (UL) [ltarr8] (10-3)

Where:

Std = the emission standard, in grams per kilowatt-hour, that 
applies under subpart B of this part for engines not participating 
in the ABT program of this subpart (the ``otherwise applicable 
standard'').
FEL = the family emission limit for the engine family, in grams per 
kilowatt-hour.
Volume = the number of engines eligible to participate in the 
averaging, banking, and trading program within the given engine 
family during the model year, as described in paragraph (c) of this 
section.
AvgPR = the average value of maximum engine power values for the 
engine configurations within an engine family, calculated on a 
sales-weighted basis, in kilowatts.
UL = the useful life for the given engine family, in hours.
    (c) As described in Sec.  1039.730, compliance with the 
requirements of this subpart is determined at the end of the model year 
based on actual U.S.-directed production volumes. Do not include any of 
the following engines to calculate emission credits:
    (1) Engines with a permanent exemption under subpart G of this part 
or under 40 CFR part 1068.
* * * * *

0
172. Section 1039.710 is amended by revising paragraph (c) to read as 
follows:


Sec.  1039.710  How do I average emission credits?

* * * * *
    (c) If you certify an engine family to an FEL that exceeds the 
otherwise applicable standard, you must obtain enough emission credits 
to offset the engine family's deficit by the due date for the final 
report required in Sec.  1039.730. The emission credits used to address 
the deficit may come from your other engine families that generate 
emission credits in the same model year, from emission credits you have 
banked from previous model years, or from emission credits generated in 
the same or previous model years that you obtained through trading.

0
173. Section 1039.725 is amended by revising paragraph (b)(2) to read 
as follows:


Sec.  1039.725  What must I include in my application for 
certification?

* * * * *
    (b) * * *
    (2) Detailed calculations of projected emission credits (positive 
or negative) based on projected production volumes. We may require you 
to include similar calculations from your other engine families to 
demonstrate that you will be able to avoid negative credit balances for 
the model year. If you project negative emission credits for a family, 
state the source of positive emission credits you expect to use to 
offset the negative emission credits.

0
174. Section 1039.730 is amended by revising paragraphs (b)(1), (b)(4), 
(c)(2), and (d) to read as follows:


Sec.  1039.730  What ABT reports must I send to EPA?

* * * * *
    (b) * * *
    (1) Engine-family designation and averaging set.
* * * * *
    (4) The projected and actual U.S.-directed production volumes for 
the model year. If you changed an FEL during the model year, identify 
the actual U.S.-directed production volume associated with each FEL.
* * * * *
    (c) * * *
    (2) State whether you will retain any emission credits for banking. 
If you choose to retire emission credits that would otherwise be 
eligible for banking, identify the engine families that generated the 
emission credits, including the number of emission credits from each 
family.
* * * * *
    (d) If you trade emission credits, you must send us a report within 
90 days after the transaction, as follows:
    (1) As the seller, you must include the following information in 
your report:
    (i) The corporate names of the buyer and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) The averaging set corresponding to the engine families that 
generated emission credits for the trade, including the number of 
emission credits from each averaging set.
    (2) As the buyer, you must include the following information in 
your report:
    (i) The corporate names of the seller and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) How you intend to use the emission credits, including the 
number of emission credits you intend to apply for each averaging set.
* * * * *

0
175. Section 1039.735 is amended by revising paragraphs (a) and (b) to 
read as follows:


Sec.  1039.735  What records must I keep?

    (a) You must organize and maintain your records as described in 
this section.
    (b) Keep the records required by this section for at least eight 
years after the due date for the end-of-year report. You may not use 
emission credits for any engines if you do not keep all the records 
required under this section. You must therefore keep these records to 
continue to bank valid credits.
* * * * *

0
176. Section 1039.740 is amended by revising paragraph (a) to read as 
follows:


Sec.  1039.740  What restrictions apply for using emission credits?

* * * * *
    (a) Averaging sets. Emission credits may be exchanged only within 
an averaging set. For emission credits generated by Tier 4 engines, 
there are two averaging sets--one for engines at or below 560 kW and 
another for engines above 560 kW.
* * * * *

Subpart I--Definitions and Other Reference Information

0
177. Section 1039.801 is amended as follows:
0
a. By revising the definitions of ``Aircraft'' and ``Designated 
Compliance Officer''.
0
b. By removing the definition for ``Designated Enforcement Officer''.
0
c. By adding definitions for ``Dual-fuel'' and ``Flexible-fuel'' in 
alphabetical order.
0
d. By revising paragraph (1)(i) of the definition of ``Model year'' and 
the definitions of ``Owners manual'' and ``Placed into service''.
0
e. By removing the definition for ``Point of first retail sale''.
0
f. By revising the definition for ``Sulfur-sensitive technology''.
    The revisions and additions read as follows:


Sec.  1039.801  What definitions apply to this part?

* * * * *

[[Page 74141]]

    Aircraft means any vehicle capable of sustained air travel more 
than 100 feet above the ground.
* * * * *
    Designated Compliance Officer means the Director, Diesel Engine 
Compliance Center, U.S. Environmental Protection Agency, 2000 
Traverwood Drive, Ann Arbor, MI 48105; [email protected]; epa.gov/otaq/verify.
* * * * *
    Dual-fuel means relating to an engine designed for operation on two 
different fuels but not on a continuous mixture of those fuels (see 
Sec.  1039.601(b)). For purposes of this part, such an engine remains a 
dual-fuel engine even if it is designed for operation on three or more 
different fuels.
* * * * *
    Flexible-fuel means relating to an engine designed for operation on 
any mixture of two or more different fuels (see Sec.  1039.601(b)).
* * * * *
    Model year means one of the following things:
    (1) * * *
    (i) Calendar year of production.
* * * * *
    Owners manual means a document or collection of documents prepared 
by the engine manufacturer for the owner or operator to describe 
appropriate engine maintenance, applicable warranties, and any other 
information related to operating or keeping the engine. The owners 
manual is typically provided to the ultimate purchaser at the time of 
sale. The owners manual may be in paper or electronic format.
* * * * *
    Placed into service means put into initial use for its intended 
purpose. Engines and equipment do not qualify as being ``placed into 
service'' based on incidental use by a manufacturer or dealer.
* * * * *
    Sulfur-sensitive technology means an emission control technology 
that experiences a significant drop in emission control performance or 
emission-system durability when an engine is operated on low-sulfur 
diesel fuel (i.e., fuel with a sulfur concentration of 300 to 500 ppm) 
as compared to when it is operated on ultra-low sulfur diesel fuel 
(i.e., fuel with a sulfur concentration less than 15 ppm). Exhaust gas 
recirculation is not a sulfur-sensitive technology.
* * * * *

0
178. Section 1039.815 is revised to read as follows:


Sec.  1039.815  What provisions apply to confidential information?

    The provisions of 40 CFR 1068.10 apply for information you consider 
confidential.

0
179. Section 1039.825 is revised to read as follows:


Sec.  1039.825  What reporting and recordkeeping requirements apply 
under this part?

    (a) This part includes various requirements to submit and record 
data or other information. Unless we specify otherwise, store required 
records in any format and on any media and keep them readily available 
for eight years after you send an associated application for 
certification, or eight years after you generate the data if they do 
not support an application for certification. You are expected to keep 
your own copy of required records rather than relying on someone else 
to keep records on your behalf. We may review these records at any 
time. You must promptly send us organized, written records in English 
if we ask for them. We may require you to submit written records in an 
electronic format.
    (b) The regulations in Sec.  1039.255, 40 CFR 1068.25, and 40 CFR 
1068.101 describe your obligation to report truthful and complete 
information. This includes information not related to certification. 
Failing to properly report information and keep the records we specify 
violates 40 CFR 1068.101(a)(2), which may involve civil or criminal 
penalties.
    (c) Send all reports and requests for approval to the Designated 
Compliance Officer (see Sec.  1039.801).
    (d) Any written information we require you to send to or receive 
from another company is deemed to be a required record under this 
section. Such records are also deemed to be submissions to EPA. We may 
require you to send us these records whether or not you are a 
certificate holder.
    (e) Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq), the 
Office of Management and Budget approves the reporting and 
recordkeeping specified in the applicable regulations. The following 
items illustrate the kind of reporting and recordkeeping we require for 
engines and equipment regulated under this part:
    (1) We specify the following requirements related to engine 
certification in this part 1039:
    (i) In Sec.  1039.20 we require engine manufacturers to label 
stationary engines that do not meet the standards in this part.
    (ii) In Sec.  1039.135 we require engine manufacturers to keep 
certain records related to duplicate labels sent to equipment 
manufacturers.
    (iii) [Reserved]
    (iv) In subpart C of this part we identify a wide range of 
information required to certify engines.
    (v) [Reserved]
    (vi) In subpart G of this part we identify several reporting and 
recordkeeping items for making demonstrations and getting approval 
related to various special compliance provisions. For example, 
equipment manufacturers must submit reports and keep records related to 
the flexibility provisions in Sec.  1039.625.
    (vii) In Sec.  1039.725, 1039.730, and 1039.735 we specify certain 
records related to averaging, banking, and trading.
    (2) We specify the following requirements related to testing in 40 
CFR part 1065:
    (i) In 40 CFR 1065.2 we give an overview of principles for 
reporting information.
    (ii) In 40 CFR 1065.10 and 1065.12 we specify information needs for 
establishing various changes to published test procedures.
    (iii) In 40 CFR 1065.25 we establish basic guidelines for storing 
test information.
    (iv) In 40 CFR 1065.695 we identify the specific information and 
data items to record when measuring emissions.
    (3) We specify the following requirements related to the general 
compliance provisions in 40 CFR part 1068:
    (i) In 40 CFR 1068.5 we establish a process for evaluating good 
engineering judgment related to testing and certification.
    (ii) In 40 CFR 1068.25 we describe general provisions related to 
sending and keeping information.
    (iii) In 40 CFR 1068.27 we require manufacturers to make engines 
available for our testing or inspection if we make such a request.
    (iv) In 40 CFR 1068.105 we require equipment manufacturers to keep 
certain records related to duplicate labels from engine manufacturers.
    (v) In 40 CFR 1068.120 we specify recordkeeping related to 
rebuilding engines.
    (vi) In 40 CFR part 1068, subpart C, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to various exemptions.
    (vii) In 40 CFR part 1068, subpart D, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to importing engines.
    (viii) In 40 CFR 1068.450 and 1068.455 we specify certain records

[[Page 74142]]

related to testing production-line engines in a selective enforcement 
audit.
    (ix) In 40 CFR 1068.501 we specify certain records related to 
investigating and reporting emission-related defects.
    (x) In 40 CFR 1068.525 and 1068.530 we specify certain records 
related to recalling nonconforming engines.
    (xi) In 40 CFR part 1068, subpart G, we specify certain records for 
requesting a hearing.

PART 1042--CONTROL OF EMISSIONS FROM NEW AND IN-USE MARINE 
COMPRESSION-IGNITION ENGINES AND VESSELS

0
180. The authority citation for part 1042 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart A--Overview and Applicability

0
181. Section 1042.1 is amended by revising paragraphs (a) and (c) 
introductory text to read as follows:


Sec.  1042.1  Applicability.

* * * * *
    (a) The emission standards of this part 1042 for freshly 
manufactured engines apply for new marine engines starting with the 
model years noted in the following table:

                         Table 1 to Sec.   1042.1--Part 1042 Applicability by Model Year
----------------------------------------------------------------------------------------------------------------
                                                                       Displacement (L/cyl) or
           Engine category              Maximum engine power \a\             application            Model year
----------------------------------------------------------------------------------------------------------------
Category 1..........................  kW < 75.....................  disp.< 0.9..................        \b\ 2009
                                      75 <= kW <= 3700............  disp.< 0.9..................            2012
                                                                    0.9 <= disp. < 1.2..........            2013
                                                                    1.2 <= disp. < 2.5..........            2014
                                                                    2.5 <= disp. < 3.5..........            2013
                                                                    3.5 <= disp. < 7.0..........            2012
                                      kW > 3700...................  All.........................            2014
Category 2..........................  kW <= 3700..................  7.0 <= disp. < 15.0.........            2013
                                      kW > 3700...................  7.0 <= disp. < 15.0.........            2014
                                      All.........................  15 <= disp. < 30............            2014
Category 3..........................  All.........................  disp. >= 30.................            2011
----------------------------------------------------------------------------------------------------------------
\a\ See Sec.   1042.140, which describes how to determine maximum engine power.
\b\ See Table 1 of Sec.   1042.101 for the first model year in which this part 1042 applies for engines with
  maximum engine power below 75 kW and displacement at or above 0.9 L/cyl.

* * * * *
    (c) Freshly manufactured engines with maximum engine power at or 
above 37 kW and originally manufactured and certified before the model 
years identified in Table 1 to this section are subject to emission 
standards and requirements of 40 CFR part 94. The provisions of this 
part 1042 do not apply for such engines certified under 40 CFR part 94, 
except as follows beginning June 29, 2010:
* * * * *

0
182. Section 1042.2 is revised to read as follows:


Sec.  1042.2  Who is responsible for compliance?

    The regulations in this part 1042 contain provisions that affect 
both engine manufacturers and others. However, the requirements of this 
part, other than those of subpart I of this part, are generally 
addressed to the engine manufacturer for freshly manufactured marine 
engines or other certificate holders. The term ``you'' generally means 
the engine manufacturer, as defined in Sec.  1042.901, especially for 
issues related to certification (including production-line testing, 
reporting, etc.). Note that for engines that become new after being 
placed into service (such as engines converted from highway or 
stationary use, or engines installed on vessels that are reflagged to 
become U.S. vessels), the requirements that normally apply for 
manufacturers of freshly manufactured engines apply to the importer or 
any other entity we allow to obtain a certificate of conformity.

0
183. Section 1042.30 is revised to read as follows:


Sec.  1042.30  Submission of information.

    Unless we specify otherwise, send all reports and requests for 
approval to the Designated Compliance Officer (see Sec.  1042.901). See 
Sec.  1042.925 for additional reporting and recordkeeping provisions.

Subpart B--Emission Standards and Related Requirements

0
184. Section 1042.101 is amended by revising the section heading and 
paragraphs (a), (b), (c), and (d)(1)(ii) to read as follows:


Sec.  1042.101  Exhaust emission standards for Category 1 and Category 
2 engines.

    (a) Duty-cycle standards. Exhaust emissions from your engines may 
not exceed emission standards, as follows:
    (1) Measure emissions using the test procedures described in 
subpart F of this part.
    (2) The following CO emission standards in this paragraph (a)(2) 
apply starting with the applicable model year identified in Sec.  
1042.1:
    (i) 8.0 g/kW-hr for engines below 8 kW.
    (ii) 6.6 g/kW-hr for engines at or above 8 kW and below 19 kW.
    (iii) 5.5 g/kW-hr for engines at or above 19 kW and below 37 kW.
    (iv) 5.0 g/kW-hr for engines at or above 37 kW.
    (3) Except as described in paragraphs (a)(4) and (5) of this 
section, the Tier 3 standards for PM and NOX+HC emissions 
are described in the following tables:

                                   Table 1 to Sec.   1042.101--Tier 3 Standards for Category 1 Engines Below 3700 kW a
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                          NOX+HC  (g/kW-
    Power density and application              Displacement  (L/cyl)             Maximum  engine power      Model year     PM  (g/kW-hr)      hr) \b\
--------------------------------------------------------------------------------------------------------------------------------------------------------
All.................................  disp. < 0.9...........................  kW < 19...................           2009+            0.40             7.5
                                                                              19 <= kW < 75.............       2009-2013            0.30             7.5
                                                                                                                   2014+        \c\ 0.30         \c\ 4.7

[[Page 74143]]

 
Commercial engines with kW/L <= 35..  disp. < 0.9...........................  kW >= 75..................           2012+            0.14             5.4
                                      0.9 <= disp. < 1.2....................  all.......................           2013+            0.12             5.4
                                      1.2 <= disp. < 2.5....................  kW < 600..................       2014-2017            0.11             5.6
                                                                                                                   2018+            0.10             5.6
                                                                              kW >= 600.................           2014+            0.11             5.6
                                      2.5 <= disp. < 3.5....................  kW < 600..................       2013-2017            0.11             5.6
                                                                                                                   2018+            0.10             5.6
                                                                              kW >= 600.................           2013+            0.11             5.6
                                      3.5 <= disp. < 7.0....................  kW < 600..................       2012-2017            0.11             5.8
                                                                                                                   2018+            0.10             5.8
                                                                              kW >= 600.................           2012+            0.11             5.8
Commercial engines with kW/L > 35,    disp. < 0.9...........................  kW >= 75..................           2012+            0.15             5.8
 and all recreational engines >= 75
 kW.
                                      0.9 <= disp. < 1.2....................  all.......................           2013+            0.14             5.8
                                      1.2 <= disp. < 2.5                                                           2014+            0.12             5.8
                                      2.5 <= disp. < 3.5                                                           2013+            0.12             5.8
                                      3.5 <= disp. < 7.0                                                           2012+            0.11             5.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
\a\ No Tier 3 standards apply for commercial Category 1 engines at or above 3700 kW. See Sec.   1042.1(c) and paragraph (a)(7) of this section for the
  standards that apply for these engines.
\b\ The applicable NOX+HC standards specified for Tier 2 engines in Appendix I of this part continue to apply instead of the values noted in the table
  for commercial engines at or above 2000 kW. FELs for these engines may not be higher than the Tier 1 NOX standard specified in Appendix I of this
  part.
\c\ See paragraph (a)(4) of this section for alternative PM and NOX+HC standards for engines at or above 19 kW and below 75 kW with displacement below
  0.9 L/cyl.


              Table 2 to Sec.   1042.101-- Tier 3 Standards for Category 2 Engines Below 3700 kW a
----------------------------------------------------------------------------------------------------------------
                                                                                                  NOX+HC  (g/kW-
       Displacement  (L/cyl)             Maximum engine power       Model year     PM  (g/kW-hr)        hr)
----------------------------------------------------------------------------------------------------------------
7.0 <= disp. < 15.0................  kW < 2000..................           2013+            0.14             6.2
                                     2000 <= kW <= 3700.........           2013+            0.14         \b\ 7.8
15.0 <= disp. < 20.0 \c\...........  kW < 2000..................           2014+            0.34             7.0
20.0 <= disp. < 25.0 \c\...........  kW < 2000..................           2014+            0.27             9.8
25.0 <= disp. < 30.0 \c\...........  kW < 2000..................           2014+            0.27            11.0
----------------------------------------------------------------------------------------------------------------
\a\ The Tier 3 standards in this table do not apply for Category 2 engines at or above 2000 kW with per-cylinder
  displacement at or above 15.0 liters, or for any Category 2 engines at or above 3700 kW. See Sec.   1042.1(c)
  and paragraphs (a)(6) through (8) of this section for the standards that apply for these engines.
\b\ For engines subject to the 7.8 g/kW-hr NOX+HC standard, FELs may not be higher than the Tier 1 NOX standards
  specified in Appendix I of this part.
\c\ There are no Tier 3 standards for Category 2 engines with per-cylinder displacement at or above 15 and 20
  liters with maximum engine power at or above 2000 kW. See paragraphs (a)(6) and (7) of this section for the
  Tier 4 standards that apply for these engines starting with the 2014 model year.

    (4) For Tier 3 engines at or above 19 kW and below 75 kW with 
displacement below 0.9 L/cyl, you may alternatively certify some or all 
of your engine families to a PM emission standard of 0.20 g/kW-hr and a 
NOX+HC emission standard of 5.8 g/kW-hr for 2014 and later 
model years.
    (5) Starting with the 2014 model year, recreational marine engines 
at or above 3700 kW (with any displacement) must be certified under 
this part 1042 to the Tier 3 standards specified in this section for 
3.5 to 7.0 L/cyl recreational marine engines.
    (6) Interim Tier 4 p.m. standards apply for 2014 and 2015 model 
year engines between 2000 and 3700 kW as specified in this paragraph 
(a)(6). These engines are considered to be Tier 4 engines.
    (i) For Category 1 engines, the Tier 3 p.m. standards from Table 1 
to this section continue to apply. PM FELs for these engines may not be 
higher than the applicable Tier 2 p.m. standards specified in Appendix 
I of this part.
    (ii) For Category 2 engines with per-cylinder displacement below 
15.0 liters, the Tier 3 p.m. standards from Table 2 to this section 
continue to apply. PM FELs for these engines may not be higher than 
0.27 g/kW-hr.
    (iii) For Category 2 engines with per-cylinder displacement at or 
above 15.0 liters, the PM standard is 0.34 g/kW-hr for engines at or 
above 2000 kW and below 3300 kW, and 0.27 g/kW-hr for engines at or 
above 3300 kW and below 3700 kW. PM FELs for these engines may not be 
higher than 0.50 g/kW-hr.
    (7) Except as described in paragraph (a)(8) of this section, the 
Tier 4 standards for PM, NOX, and HC emissions are described 
in the following table:

                    Table 3 to Sec.   1042.101--Tier 4 Standards for Category 2 and Commercial Category 1 Engines at or Above 600 kW
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Maximum engine power                        Displacement  (L/cyl)             Model year     PM  (g/kW-hr)  NOX  (g/kW-hr)   HC  (g/kW-hr)
--------------------------------------------------------------------------------------------------------------------------------------------------------
600 <= kW < 1400...............................  all....................................           2017+            0.04             1.8            0.19

[[Page 74144]]

 
1400 <= kW < 2000..............................  all....................................           2016+            0.04             1.8            0.19
2000 <= kW <= 3700 \a\.........................  all....................................           2014+            0.04             1.8            0.19
kW > 3700......................................  disp. < 15.0...........................       2014-2015            0.12             1.8            0.19
                                                 15.0 <= disp. < 30.0...................       2014-2015            0.25             1.8            0.19
                                                 all....................................           2016+            0.06             1.8            0.19
--------------------------------------------------------------------------------------------------------------------------------------------------------
\a\ See paragraph (a)(6) of this section for interim PM standards that apply for model years 2014 and 2015 for engines between 2000 and 3700 kW. The
  Tier 4 NOX FEL cap for engines at or above 2000 kW and below 3700 kW is 7.0 g/kW-hr. Starting in the 2016 model year, the Tier 4 PM FEL cap for
  engines at or above 2000 kW and below 3700 kW is 0.34 g/kW-hr.

    (8) The following optional provisions apply for complying with the 
Tier 3 and Tier 4 standards specified in paragraphs (a)(3) through (7) 
of this section:
    (i) You may use NOX credits accumulated through the ABT 
program to certify Tier 4 engines to a NOX+HC emission 
standard of 1.9 g/kW-hr instead of the NOX and HC standards 
that would otherwise apply by certifying your family to a 
NOX+HC FEL. Calculate the NOX credits needed as 
specified in subpart H of this part using the NOX+HC 
emission standard and FEL in the calculation instead of the otherwise 
applicable NOX standard and FEL. You may not generate 
credits relative to the alternate standard or certify to the standard 
without using credits.
    (ii) For engines below 1000 kW, you may delay complying with the 
Tier 4 standards in the 2017 model year for up to nine months, but you 
must comply no later than October 1, 2017.
    (iii) For engines at or above 3700 kW, you may delay complying with 
the Tier 4 standards in the 2016 model year for up to twelve months, 
but you must comply no later than December 31, 2016.
    (iv) For Category 2 engines at or above 1400 kW, you may 
alternatively comply with the Tier 3 and Tier 4 standards specified in 
Table 4 of this section instead of the NOX, HC, 
NOX+HC, and PM standards specified in paragraphs (a)(3) 
through (7) of this section. The CO standards specified in paragraph 
(a)(2) of this section apply without regard to whether you choose this 
option. If you choose this option, you must do so for all engines at or 
above 1400 kW in the same displacement category (that is, 7-15, 15-20, 
20-25, or 25-30 liters per cylinder) in model years 2012 through 2015.

                       Table 4 to Sec.   1042.101--Optional Tier 3 and Tier 4 Standards for Category 2 Engines at or Above 1400 kW
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Tier                                 Maximum engine power             Model year     PM  (g/kW-hr)  NOX  (g/kW-hr)   HC  (g/kW-hr)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Tier 3.........................................  kW >= 1400.............................       2012-2014            0.14      7.8 NOX+HC  ..............
Tier 4.........................................  1400 <= kW <= 3700.....................            2015            0.04             1.8            0.19
                                                 kW > 3700..............................            2015            0.06             1.8            0.19
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (b) Averaging, banking, and trading. You may generate or use 
emission credits under the averaging, banking, and trading (ABT) 
program as described in subpart H of this part for demonstrating 
compliance with NOX, NOX+HC, and PM emission 
standards for Category 1 and Category 2 engines. You may also use 
NOX or NOX+HC emission credits to comply with the 
alternate NOX+HC standard in paragraph (a)(8)(i) of this 
section. Generating or using emission credits requires that you specify 
a family emission limit (FEL) for each pollutant you include in the ABT 
program for each engine family. These FELs serve as the emission 
standards for the engine family with respect to all required testing 
instead of the standards specified in paragraph (a) of this section. 
The FELs determine the not-to-exceed standards for your engine family, 
as specified in paragraph (c) of this section. Unless otherwise 
specified, the following FEL caps apply:
    (1) FELs for Tier 3 engines may not be higher than the applicable 
Tier 2 standards specified in Appendix I of this part.
    (2) FELs for Tier 4 engines may not be higher than the applicable 
Tier 3 standards specified in paragraph (a)(3) of this section.
    (3) The following FEL caps apply for engines at or above 3700 kW 
that are not subject to Tier 3 standards under paragraph (a)(3) of this 
section:
    (i) FELs may not be higher than the applicable Tier 1 
NOX standards specified in Appendix I of this part before 
the Tier 4 standards start to apply.
    (ii) FELs may not be higher than the applicable Tier 2 
NOX+THC standards specified in Appendix I of this part after 
the Tier 4 standards start to apply.
    (c) Not-to-exceed standards. Except as noted in Sec.  1042.145(e), 
exhaust emissions from all engines subject to the requirements of this 
part may not exceed the not-to-exceed (NTE) standards as follows:
    (1) Use the following equation to determine the NTE standards:

(i) NTE standard for each pollutant = STD x M.

Where:

STD = The standard specified for that pollutant in this section if 
you certify without using ABT for that pollutant; or the FEL for 
that pollutant if you certify using ABT.
M = The NTE multiplier for that pollutant.

    (ii) Round each NTE standard to the same number of decimal places 
as the emission standard.
    (2) Determine the applicable NTE zone and subzones as described in 
Sec.  1042.515. Determine NTE multipliers for specific zones and 
subzones and pollutants as follows:
    (i) For marine engines certified using the duty cycle specified in 
Sec.  1042.505(b)(1), except for variable-speed propulsion marine 
engines used with controllable-pitch propellers or with electrically 
coupled propellers, apply the following NTE multipliers:

[[Page 74145]]

    (A) Subzone 1: 1.2 for Tier 3 NOX+HC standards.
    (B) Subzone 1: 1.5 for Tier 4 standards and Tier 3 p.m. and CO 
standards.
    (C) Subzone 2: 1.5 for Tier 4 NOX and HC standards and 
for Tier 3 NOX+HC standards.
    (D) Subzone 2: 1.9 for PM and CO standards.
    (ii) For recreational marine engines certified using the duty cycle 
specified in Sec.  1042.505(b)(2), except for variable-speed marine 
engines used with controllable-pitch propellers or with electrically 
coupled propellers, apply the following NTE multipliers:
    (A) Subzone 1: 1.2 for Tier 3 NOX+HC standards.
    (B) Subzone 1: 1.5 for Tier 3 p.m. and CO standards.
    (C) Subzones 2 and 3: 1.5 for Tier 3 NOX+HC standards.
    (D) Subzones 2 and 3: 1.9 for PM and CO standards.
    (iii) For variable-speed marine engines used with controllable-
pitch propellers or with electrically coupled propellers that are 
certified using the duty cycle specified in Sec.  1042.505(b)(1), (2), 
or (3), apply the following NTE multipliers:
    (A) Subzone 1: 1.2 for Tier 3 NOX+HC standards.
    (B) Subzone 1: 1.5 for Tier 4 standards and Tier 3 p.m. and CO 
standards.
    (C) Subzone 2: 1.5 for Tier 4 NOX and HC standards and 
for Tier 3 NOX+HC standards.
    (D) Subzone 2: 1.9 for PM and CO standards. However, there is no 
NTE standard in Subzone 2b for PM emissions if the engine family's 
applicable standard for PM is at or above 0.07 g/kW-hr.
    (iv) For constant-speed engines certified using a duty cycle 
specified in Sec.  1042.505(b)(3) or (4), apply the following NTE 
multipliers:
    (A) Subzone 1: 1.2 for Tier 3 NOX+HC standards.
    (B) Subzone 1: 1.5 for Tier 4 standards and Tier 3 p.m. and CO 
standards.
    (C) Subzone 2: 1.5 for Tier 4 NOX and HC standards and 
for Tier 3 NOX+HC standards.
    (D) Subzone 2: 1.9 for PM and CO standards. However, there is no 
NTE standard for PM emissions if the engine family's applicable 
standard for PM is at or above 0.07 g/kW-hr.
    (v) For variable-speed auxiliary marine engines certified using the 
duty cycle specified in Sec.  1042.505(b)(5)(ii) or (iii):
    (A) Subzone 1: 1.2 for Tier 3 NOX+HC standards.
    (B) Subzone 1: 1.5 for Tier 4 standards and Tier 3 p.m. and CO 
standards.
    (C) Subzone 2: 1.2 for Tier 3 NOX+HC standards.
    (D) Subzone 2: 1.5 for Tier 4 standards and Tier 3 p.m. and CO 
standards. However, there is no NTE standard for PM emissions if the 
engine family's applicable standard for PM is at or above 0.07 g/kW-hr.
    (3) The NTE standards apply to your engines whenever they operate 
within the NTE zone for an NTE sampling period of at least thirty 
seconds, during which only a single operator demand set point may be 
selected. Engine operation during a change in operator demand is 
excluded from any NTE sampling period. There is no maximum NTE sampling 
period.
    (4) Collect emission data for determining compliance with the NTE 
standards using the procedures described in subpart F of this part.
    (5) You may ask us to accept as compliant an engine that does not 
fully meet specific requirements under the applicable NTE standards 
where such deficiencies are necessary for safety.
    (d) * * *
    (1) * * *
    (ii) Gaseous-fueled engines must comply with HC standards based on 
nonmethane-nonethane hydrocarbon emissions.
* * * * *

0
185. Section 1042.104 is amended by revising paragraph (a)(2) to read 
as follows:


Sec.  1042.104  Exhaust emission standards for Category 3 engines.

    (a) * * *
    (2) NOX standards apply based on the engine's model year 
and maximum in-use engine speed as shown in the following table:

               Table 1 to Sec.   1042.104--NOX Emission Standards for Category 3 Engines (g/kW-hr)
----------------------------------------------------------------------------------------------------------------
                                                                        Maximum in-use engine speed
                                                         -------------------------------------------------------
       Emission standards               Model year         Less than 130
                                                                RPM          130-2000 RPM \a\      Over 2000 RPM
----------------------------------------------------------------------------------------------------------------
Tier 1.........................  2004-2010 \b\..........            17.0  45.0 [middot] n(-0.20)             9.8
Tier 2.........................  2011-2015..............            14.4  44.0 [middot] n(-0.23)             7.7
Tier 3 \c\.....................  2016 and later.........             3.4  9.0 [middot] n(-0.20).             2.0
----------------------------------------------------------------------------------------------------------------
\a\ Applicable standards are calculated from n (maximum in-use engine speed, in RPM, as specified in Sec.
  1042.140). Round the standards to one decimal place.
\b\ Tier 1 NOX standards apply as specified in 40 CFR part 94 for engines originally manufactured in model years
  2004 through 2010. They are shown here only for reference.
\c\ For engines designed with on-off controls as specified in Sec.   1042.115(g), the Tier 2 standards continue
  to apply any time the engine has disabled its Tier 3 NOX emission controls.

* * * * *

0
186. Section 1042.110 is amended by revising paragraphs (a)(1) and (d) 
and removing and reserving paragraph (b).
    The revisions read as follows:


Sec.  1042.110  Recording reductant use and other diagnostic functions.

    (a) * * *
    (1) The diagnostic system must monitor reductant quality and tank 
levels and alert operators to the need to refill the reductant tank 
before it is empty, or to replace the reductant if it does not meet 
your concentration specifications. Unless we approve other alerts, use 
a malfunction-indicator light (MIL) and an audible alarm. You do not 
need to separately monitor reductant quality if your system uses input 
from an exhaust NOX sensor (or other sensor) to alert 
operators when reductant quality is inadequate. However, tank level 
must be monitored in all cases.
* * * * *
    (d) For Category 3 engines equipped with on-off NOX 
controls (as allowed by Sec.  1042.115(g)), you must also equip your 
engine to continuously monitor NOX concentrations in the 
exhaust. See Sec.  1042.650 to determine if this requirement applies 
for a given Category 1 or Category 2 engine. For measurement 
technologies involving discrete sampling events, measurements are 
considered continuous if they repeat at least once every 60 seconds; we 
may approve a longer sampling period if it is necessary or appropriate 
for sufficiently accurate measurements. Describe your

[[Page 74146]]

system for onboard NOX measurements in your application for 
certification. Use good engineering judgment to alert operators if 
measured NOX concentrations indicate malfunctioning emission 
controls. Record any such operation in nonvolatile computer memory. You 
are not required to monitor NOX concentrations during 
operation for which the emission controls may be disabled under Sec.  
1042.115(g). For the purpose of this paragraph (d), ``malfunctioning 
emission controls'' means any condition in which the measured 
NOX concentration exceeds the highest value expected when 
the engine is in compliance with the installed engine standard of Sec.  
1042.104(g). Use good engineering judgment to determine these expected 
values during production-line testing of the engine using linear 
interpolation between test points and accounting for the degree to 
which the cycle-weighted emissions of the engine are below the 
standard. You may also use additional intermediate test points measured 
during the production-line test. Note that the provisions of paragraph 
(a) of this section also apply for SCR systems covered by this 
paragraph (d). For engines subject to both the provisions of paragraph 
(a) of this section and this paragraph (d), use good engineering 
judgment to integrate diagnostic features to comply with both 
paragraphs. For example, engines may use on-off NOX controls 
to disable certain emission control functions only if the diagnostic 
system indicates that the monitoring described in this paragraph (d) is 
active.

0
187. Section 1042.120 is amended by revising paragraph (b) introductory 
text to read as follows:


Sec.  1042.120  Emission-related warranty requirements.

* * * * *
    (b) Warranty period. Your emission-related warranty must be valid 
for at least as long as the minimum warranty periods listed in this 
paragraph (b) in hours of operation and years, whichever comes first. 
You may offer an emission-related warranty more generous than we 
require. The emission-related warranty for the engine may not be 
shorter than any basic mechanical warranty you provide without charge 
for the engine. Similarly, the emission-related warranty for any 
component may not be shorter than any warranty you provide without 
charge for that component. This means that your warranty may not treat 
emission-related and nonemission-related defects differently for any 
component. If an engine has no hour meter, we base the warranty periods 
in this paragraph (b) only on the engine's age (in years). The warranty 
period begins when the engine is placed into service. The following 
minimum warranty periods apply:
* * * * *

0
188. Section 1042.125 is amended by revising paragraphs (a)(2)(i), 
(a)(3)(i), (c), (e), and (f) introductory text to read as follows:


Sec.  1042.125  Maintenance instructions.

* * * * *
    (a) * * *
    (2) * * *
    (i) For EGR-related filters and coolers, DEF filters, crankcase 
ventilation valves and filters, and fuel injector tips (cleaning only), 
the minimum interval is 1,500 hours.
* * * * *
    (3) * * *
    (i) For EGR-related filters and coolers, DEF filters, crankcase 
ventilation valves and filters, and fuel injector tips (cleaning only), 
the minimum interval is 1,500 hours.
* * * * *
    (c) Special maintenance. You may specify more frequent maintenance 
to address problems related to special situations, such as atypical 
engine operation. You must clearly state that this additional 
maintenance is associated with the special situation you are 
addressing. You may also address maintenance of low-use engines (such 
as recreational or stand-by engines) by specifying the maintenance 
interval in terms of calendar months or years in addition to your 
specifications in terms of engine operating hours. All special 
maintenance instructions must be consistent with good engineering 
judgment. We may disapprove your maintenance instructions if we 
determine that you have specified special maintenance steps to address 
maintenance that is unlikely to occur in use, or engine operation that 
is not atypical. For example, this paragraph (c) does not allow you to 
design engines that require special maintenance for a certain type of 
expected operation. If we determine that certain maintenance items do 
not qualify as special maintenance under this paragraph (c), you may 
identify this as recommended additional maintenance under paragraph (b) 
of this section.
* * * * *
    (e) Maintenance that is not emission-related. For maintenance 
unrelated to emission controls, you may schedule any amount of 
inspection or maintenance. You may also take these inspection or 
maintenance steps during service accumulation on your emission-data 
engines, as long as they are reasonable and technologically necessary. 
This might include adding engine oil, changing air, fuel, or oil 
filters, servicing engine-cooling systems, and adjusting idle speed, 
governor, engine bolt torque, valve lash, or injector lash. You may not 
perform this nonemission-related maintenance on emission-data engines 
more often than the least frequent intervals that you recommend to the 
ultimate purchaser.
    (f) Source of parts and repairs. State clearly in your written 
maintenance instructions that a repair shop or person of the owner's 
choosing may maintain, replace, or repair emission control devices and 
systems. Your instructions may not require components or service 
identified by brand, trade, or corporate name. Also, do not directly or 
indirectly condition your warranty on a requirement that the engine be 
serviced by your franchised dealers or any other service establishments 
with which you have a commercial relationship. You may disregard the 
requirements in this paragraph (f) if you do one of two things:
* * * * *

0
189. Section 1042.130 is amended by revising paragraph (b) to read as 
follows:


Sec.  1042.130  Installation instructions for vessel manufacturers.

* * * * *
    (b) Make sure these instructions have the following information:
    (1) Include the heading: ``Emission-related installation 
instructions''.
    (2) State: ``Failing to follow these instructions when installing a 
certified engine in a vessel violates federal law (40 CFR 1068.105(b)), 
subject to fines or other penalties as described in the Clean Air 
Act.''
    (3) Describe the instructions needed to properly install the 
exhaust system and any other components. Include instructions 
consistent with the requirements of Sec.  1042.205(u).
    (4) Describe any necessary steps for installing the diagnostic 
system described in Sec.  1042.110.
    (5) Describe how your certification is limited for any type of 
application. . For example, if your engines are certified only for 
constant-speed operation, tell vessel manufacturers not to install the 
engines in variable-speed applications or modify the governor.
    (6) Describe any other instructions to make sure the installed 
engine will operate according to design specifications in your 
application for certification. This may include, for example, 
instructions for installing aftertreatment devices when installing the 
engines.

[[Page 74147]]

    (7) State: ``If you install the engine in a way that makes the 
engine's emission control information label hard to read during normal 
engine maintenance, you must place a duplicate label on the vessel, as 
described in 40 CFR 1068.105.''
    (8) Describe any vessel labeling requirements specified in Sec.  
1042.135.
* * * * *

0
190. Section 1042.135 is amended by revising paragraphs (b), (c), 
(d)(1), and (e) introductory text to read as follows:


Sec.  1042.135  Labeling.

* * * * *
    (b) At the time of manufacture, affix a permanent and legible label 
identifying each engine. The label must meet the requirements of 40 CFR 
1068.45.
    (c) The label must--
    (1) Include the heading ``EMISSION CONTROL INFORMATION''.
    (2) Include your full corporate name and trademark. You may 
identify another company and use its trademark instead of yours if you 
comply with the branding provisions of 40 CFR 1068.45.
    (3) Include EPA's standardized designation for the engine family 
(and subfamily, where applicable).
    (4) Identify all the emission standards that apply to the engine 
(or FELs, if applicable). If you do not declare an FEL under subpart H 
of this part, you may alternatively state the engine's category, 
displacement (in liters or L/cyl), maximum engine power (in kW), and 
power density (in kW/L) as needed to determine the emission standards 
for the engine family. You may specify displacement, maximum engine 
power, or power density as a range consistent with the ranges listed in 
Sec.  1042.101. See Sec.  1042.140 for descriptions of how to specify 
per-cylinder displacement, maximum engine power, and power density.
    (5) State the date of manufacture [DAY (optional), MONTH, and 
YEAR]; however, you may omit this from the label if you stamp, engrave, 
or otherwise permanently identify it elsewhere on the engine, in which 
case you must also describe in your application for certification where 
you will identify the date on the engine.
    (6) Identify the application(s) for which the engine family is 
certified (such as constant-speed auxiliary, variable-speed propulsion 
engines used with fixed-pitch propellers, etc.). If the engine is 
certified as a recreational engine, state: ``INSTALLING THIS 
RECREATIONAL ENGINE IN A COMMERCIAL VESSEL OR USING THE VESSEL FOR 
COMMERCIAL PURPOSES MAY VIOLATE FEDERAL LAW SUBJECT TO CIVIL PENALTY 
(40 CFR 1042.601).''
    (7) For engines using sulfur-sensitive technologies, state: ``ULTRA 
LOW SULFUR DIESEL FUEL ONLY''.
    (8) State the useful life for your engine family if the applicable 
useful life is based on the provisions of Sec.  1042.101(e)(2) or (3), 
or Sec.  1042.104(d)(2).
    (9) Identify the emission control system. Use terms and 
abbreviations as described in 40 CFR 1068.45. You may omit this 
information from the label if there is not enough room for it and you 
put it in the owners manual instead.
    (10) State: ``THIS MARINE ENGINE COMPLIES WITH U.S. EPA REGULATIONS 
FOR [MODEL YEAR].''
    (11) For a Category 1 or Category 2 engine that can be modified to 
operate on residual fuel, but has not been certified to meet the 
standards on such a fuel, include the statement: ``THIS ENGINE IS 
CERTIFIED FOR OPERATION ONLY WITH DIESEL FUEL. MODIFYING THE ENGINE TO 
OPERATE ON RESIDUAL OR INTERMEDIATE FUEL MAY BE A VIOLATION OF FEDERAL 
LAW SUBJECT TO CIVIL PENALTIES.''
    (12) For an engine equipped with on-off emission controls as 
allowed by Sec.  1042.115, include the statement: ``THIS ENGINE IS 
CERTIFIED WITH ON-OFF EMISSION CONTROLS. OPERATION OF THE ENGINE 
CONTRARY TO 40 CFR 1042.115(g) IS A VIOLATION OF FEDERAL LAW SUBJECT TO 
CIVIL PENALTIES.''
    (13) For engines intended for installation on domestic or public 
vessels, include the following statement: ``THIS ENGINE DOES NOT COMPLY 
WITH INTERNATIONAL MARINE REGULATIONS FOR COMMERCIAL VESSELS UNLESS IT 
IS ALSO COVERED BY AN EIAPP CERTIFICATE.''
    (d) * * *
    (1) You may identify other emission standards that the engine meets 
or does not meet (such as international standards), as long as this 
does not cause you to omit any of the information described in 
paragraphs (c)(5) through (9) of this section. You may add the 
information about the other emission standards to the statement we 
specify, or you may include it in a separate statement.
* * * * *
    (e) For engines using sulfur-sensitive technologies, create a 
separate label with the statement: ``ULTRA LOW SULFUR DIESEL FUEL 
ONLY''. Permanently attach this label to the vessel near the fuel inlet 
or, if you do not manufacture the vessel, take one of the following 
steps to ensure that the vessel will be properly labeled:
* * * * *

0
191. Section 1042.140 is amended by revising paragraph (e) to read as 
follows:


Sec.  1042.140  Maximum engine power, displacement, power density, and 
maximum in-use engine speed.

* * * * *
    (e) Throughout this part, references to a specific power value for 
an engine are based on maximum engine power. For example, the group of 
engines with maximum engine power below 600 kW may be referred to as 
engines below 600 kW.
* * * * *

Subpart C--Certifying Engine Families

0
192. Section 1042.201 is amended by revising paragraphs (a) and (g) to 
read as follows:


Sec.  1042.201  General requirements for obtaining a certificate of 
conformity.

    (a) You must send us a separate application for a certificate of 
conformity for each engine family. A certificate of conformity is valid 
for new production from the indicated effective date until the end of 
the model year for which it is issued, which may not extend beyond 
December 31 of that year. No certificate will be issued after December 
31 of the model year. You may amend your application for certification 
after the end of the model year in certain circumstances as described 
in Sec. Sec.  1042.220 and 1042.225. You must renew your certification 
annually for any engines you continue to produce.
* * * * *
    (g) We may require you to deliver your test engines to a facility 
we designate for our testing (see Sec.  1042.235(c)). Alternatively, 
you may choose to deliver another engine that is identical in all 
material respects to the test engine, or another engine that we 
determine can appropriately serve as an emission-data engine for the 
engine family.
* * * * *

0
193. Section 1042.205 is amended by revising paragraphs (g), (o), 
(r)(1), and (bb)(1) to read as follows:


Sec.  1042.205  Application requirements.

* * * * *
    (g) List the specifications of the test fuel (or mixture of test 
fuels) to show that they fall within the required ranges we specify in 
40 CFR part 1065.
* * * * *

[[Page 74148]]

    (o) Present emission data for HC, NOX, PM, and CO on an 
emission-data engine to show your engines meet emission standards as 
specified in Sec. Sec.  1042.101 or 1042.104. Note that you must submit 
PM data for all engines, whether or not a PM standard applies. Show 
emission figures before and after applying adjustment factors for 
regeneration and deterioration factors for each pollutant and for each 
engine. If we specify more than one grade of any fuel type (for 
example, high-sulfur and low-sulfur diesel fuel), you need to submit 
test data only for one grade, unless the regulations of this part 
specify otherwise for your engine. Include emission results for each 
mode for Category 3 engines or for other engines if you do discrete-
mode testing under Sec.  1042.505. For engines using on-off controls as 
described in Sec.  1042.115(g), include emission data demonstrating 
compliance with the Tier 2 standards when the engines Tier 3 
NOX emission controls are disabled. Note that Sec. Sec.  
1042.235 and 1042.245 allows you to submit an application in certain 
cases without new emission data.
* * * * *
    (r) * * *
    (1) Report all valid test results involving measurement of 
pollutants for which emission standards apply. Also indicate whether 
there are test results from invalid tests or from any other tests of 
the emission-data engine, whether or not they were conducted according 
to the test procedures of subpart F of this part. We may require you to 
report these additional test results. We may ask you to send other 
information to confirm that your tests were valid under the 
requirements of this part and 40 CFR part 1065.
* * * * *
    (bb) * * *
    (1) Describe your normal practice for importing engines. For 
example, this may include identifying the names and addresses of any 
agents you have authorized to import your engines.
* * * * *

0
194. Section 1042.225 is amended by adding paragraphs (b)(4) and (g) to 
read as follows:


Sec.  1042.225  Amending applications for certification.

* * * * *
    (b) * * *
    (4) Include any other information needed to make your application 
correct and complete.
* * * * *
    (g) You may produce engines as described in your amended 
application for certification and consider those engines to be in a 
certified configuration if we approve a new or modified engine 
configuration during the model year under paragraph (d) of this 
section. Similarly, you may modify in-use engines as described in your 
amended application for certification and consider those engines to be 
in a certified configuration if we approve a new or modified engine 
configuration at any time under paragraph (d) of this section. 
Modifying a new or in-use engine to be in a certified configuration 
does not violate the tampering prohibition of 40 CFR 1068.101(b)(1), as 
long as this does not involve changing to a certified configuration 
with a higher family emission limit.

0
195. Section 1042.235 is amended by revising paragraphs (b), (c) 
introductory text, (c)(4), and (d)(1) to read as follows:


Sec.  1042.235  Emission testing related to certification.

* * * * *
    (b) Test your emission-data engines using the procedures and 
equipment specified in subpart F of this part. In the case of dual-fuel 
engines, measure emissions when operating with each type of fuel for 
which you intend to certify the engine. In the case of flexible-fuel 
engines, measure emissions when operating with the fuel mixture that 
best represents in-use operation or is most likely to have the highest 
NOX emissions (or NOX+HC emissions for engines 
subject to NOX+HC standards), though you may ask us to 
instead to perform tests with both fuels separately if you can show 
that intermediate mixtures are not likely to occur in use.
* * * * *
    (c) We may perform confirmatory testing by measuring emissions from 
any of your emission-data engines or other engines from the engine 
family, as follows:
* * * * *
    (4) Before we test one of your engines, we may calibrate it within 
normal production tolerances for anything we do not consider an 
adjustable parameter. For example, this would apply for an engine 
parameter that is subject to production variability because it is 
adjustable during production, but is not considered an adjustable 
parameter (as defined in Sec.  1042.901) because it is permanently 
sealed. For parameters that relate to a level of performance that is 
itself subject to a specified range (such as maximum power output), we 
will generally perform any calibration under this paragraph (c)(4) in a 
way that keeps performance within the specified range.
    (d) * * *
    (1) The engine family from the previous model year differs from the 
current engine family only with respect to model year, items identified 
in Sec.  1042.225(a), or other characteristics unrelated to emissions. 
We may waive this criterion for differences we determine not to be 
relevant.
* * * * *

0
196. Section 1042.240 is amended by revising paragraph (c)(3), adding 
paragraphs (c)(4) and (5), and revising paragraph (d) to read as 
follows:


Sec.  1042.240  Demonstrating compliance with exhaust emission 
standards.

* * * * *
    (c) * * *
    (3) Sawtooth and other nonlinear deterioration patterns. The 
deterioration factors described in paragraphs (c)(1) and (2) of this 
section assume that the highest useful life emissions occur either at 
the end of useful life or at the low-hour test point. The provisions of 
this paragraph (c)(3) apply where good engineering judgment indicates 
that the highest emissions over the useful life will occur between 
these two points. For example, emissions may increase with service 
accumulation until a certain maintenance step is performed, then return 
to the low-hour emission levels and begin increasing again. Base 
deterioration factors for engines with such emission patterns on the 
difference between (or ratio of) the point at which the highest 
emissions occur and the low-hour test point. Note that this applies for 
maintenance-related deterioration only where we allow such critical 
emission-related maintenance.
    (4) Deterioration factor for crankcase emissions. If your engine 
vents crankcase emissions to the exhaust or to the atmosphere, you must 
account for crankcase emission deterioration, using good engineering 
judgment. You may use separate deterioration factors for crankcase 
emissions of each pollutant (either multiplicative or additive) or 
include the effects in combined deterioration factors that include 
exhaust and crankcase emissions together for each pollutant.
    (5) Dual-fuel and flexible-fuel engines. In the case of dual-fuel 
and flexible-fuel engines, apply deterioration factors separately for 
each fuel type. You may accumulate service hours on a single emission-
data engine using the type of fuel or the fuel mixture expected to have 
the highest combustion and exhaust temperatures; you may ask us to 
approve a different fuel mixture if you demonstrate that a different 
criterion is more appropriate.
    (d) Determine the official emission result for each pollutant to at 
least one

[[Page 74149]]

more decimal place than the applicable standard. Apply the 
deterioration factor to the official emission result, as described in 
paragraph (c) of this section, then round the adjusted figure to the 
same number of decimal places as the emission standard. Compare the 
rounded emission levels to the emission standard for each emission-data 
engine. In the case of NOX+HC standards, apply the 
deterioration factor to each pollutant and then add the results before 
rounding.
* * * * *

0
197. Section 1042.250 is amended by revising paragraphs (b)(3)(iv) and 
(c) to read as follows:


Sec.  1042.250  Recordkeeping and reporting.

* * * * *
    (b) * * *
    (3) * * *
    (iv) All your emission tests, including the date and purpose of 
each test and documentation of test parameters as specified in part 40 
CFR part 1065.
* * * * *
    (c) Keep required data from emission tests and all other 
information specified in this section for eight years after we issue 
your certificate. If you use the same emission data or other 
information for a later model year, the eight-year period restarts with 
each year that you continue to rely on the information.
* * * * *

0
198. Section 1042.255 is amended by revising paragraphs (c)(2), (d), 
and (e) to read as follows:


Sec.  1042.255  EPA decisions.

* * * * *
    (c) * * *
    (2) Submit false or incomplete information (paragraph (e) of this 
section applies if this is fraudulent). This includes doing anything 
after submission of your application to render any of the submitted 
information false or incomplete.
* * * * *
    (d) We may void the certificate of conformity for an engine family 
if you fail to keep records, send reports, or give us information as 
required under this part or the Clean Air Act. Note that these are also 
violations of 40 CFR 1068.101(a)(2).
    (e) We may void your certificate if we find that you intentionally 
submitted false or incomplete information. This includes rendering 
submitted information false or incomplete after submission.
* * * * *

Subpart D--Testing Production-Line Engines

0
199. Section 1042.301 is amended by revising paragraph (a) introductory 
text to read as follows:


Sec.  1042.301   General provisions.

    (a) If you produce freshly manufactured marine engines that are 
subject to the requirements of this part, you must test them as 
described in this subpart, except as follows:
* * * * *

0
200. Section 1042.302 is amended by revising paragraph (a) to read as 
follows:


Sec.  1042.302  Applicability of this subpart for Category 3 engines.

* * * * *
    (a) You must test each Category 3 engine at the sea trial of the 
vessel in which it is installed or within the first 300 hours of 
operation, whichever occurs first. This may involve testing a fully 
assembled production engine before it is installed in the vessel. Since 
you must test each engine, the provisions of Sec. Sec.  1042.310 and 
1042.315(b) do not apply for Category 3 engines. If we determine that 
an engine failure under this subpart is caused by defective components 
or design deficiencies, we may revoke or suspend your certificate for 
the engine family as described in Sec.  1042.340. If we determine that 
an engine failure under this subpart is caused only by incorrect 
assembly, we may suspend your certificate for the engine family as 
described in Sec.  1042.325. If the engine fails, you may continue 
operating only to complete the sea trial and return to port. It is a 
violation of 40 CFR 1068.101(b)(1) to operate the vessel further until 
you remedy the cause of failure. Each two-hour period of such operation 
constitutes a separate offense. A violation lasting less than two hours 
constitutes a single offense.
* * * * *

Subpart F--Test Procedures

0
201. Section 1042.501 is amended by revising paragraphs (a), (d), (e), 
and (f) and adding paragraph (h) to read as follows:


Sec.  1042.501  How do I run a valid emission test?

* * * * *
    (a) Use the equipment and procedures for compression-ignition 
engines in 40 CFR part 1065 to determine whether engines meet the duty-
cycle emission standards in Sec. Sec.  1042.101 or 1042.104. Measure 
the emissions of all regulated pollutants as specified in 40 CFR part 
1065. Use the applicable duty cycles specified in Sec.  1042.505. The 
following exceptions from the 40 CFR part 1065 procedures apply:
    (1) If you perform discrete-mode testing and use only one batch 
fuel measurement to determine your mean raw exhaust flow rate, you must 
target a constant sample flow rate over the mode. Verify proportional 
sampling as described in 40 CFR 1065.545 using the mean raw exhaust 
molar flow rate paired with each recorded sample flow rate.
    (2) If you perform discrete[hyphen]mode testing, you may verify 
proportional sampling over the whole duty cycle instead of verifying 
proportional sampling for each discrete mode.
* * * * *
    (d) Adjust measured emissions to account for aftertreatment 
technology with infrequent regeneration as described in Sec.  1042.525.
    (e) Duty-cycle testing is limited to atmospheric pressures between 
91.000 and 103.325 kPa.
    (f) You may use special or alternate procedures to the extent we 
allow them under 40 CFR 1065.10.
* * * * *
    (h) This subpart is addressed to you as a manufacturer, but it 
applies equally to anyone who does testing for you, and to us when we 
perform testing to determine if your engines meet emission standards.

0
202. Section 1042.505 is amended by revising paragraph (b)(5)(iii) to 
read as follows:


Sec.  1042.505  Testing engines using discrete-mode or ramped-modal 
duty cycles.

* * * * *
    (b) * * *
    (5) * * *
    (iii) Use the 8-mode duty cycle or the corresponding ramped-modal 
cycle described in 40 CFR part 1039, Appendix II, paragraph (c) for 
variable-speed auxiliary engines with maximum engine power at or above 
19 kW that are not propeller-law engines.
* * * * *

0
203. Section 1042.515 is amended by revising paragraphs (f)(2), (f)(4), 
and (g) to read as follows:


Sec.  1042.515  Test procedures related to not-to-exceed standards.

* * * * *
    (f) * * *
    (2) You may ask us to approve a Limited Testing Region (LTR). An 
LTR is a region of engine operation, within the applicable NTE zone, 
where you have demonstrated that your engine family operates for no 
more than 5.0

[[Page 74150]]

percent of its normal in-use operation, on a time-weighted basis. You 
must specify an LTR using boundaries based on engine speed and power 
(or torque), where the LTR boundaries must coincide with some portion 
of the boundary defining the overall NTE zone. Any emission data 
collected within an LTR for a time duration that exceeds 5.0 percent of 
the duration of its respective NTE sampling period will be excluded 
when determining compliance with the applicable NTE standards. Any 
emission data collected within an LTR for a time duration of 5.0 
percent or less of the duration of the respective NTE sampling period 
will be included when determining compliance with the NTE standards.
* * * * *
    (4) You may exclude emission data based on catalytic aftertreatment 
temperatures as follows:
    (i) For an engine equipped with a catalytic NOX 
aftertreatment system, exclude NOX emission data that is 
collected when the exhaust temperature at any time during the NTE event 
is less than 250 [deg]C.
    (ii) For an engine equipped with an oxidizing catalytic 
aftertreatment system, exclude HC and CO emission data that is 
collected when the exhaust temperature at any time during the NTE event 
is less than 250 [deg]C. Similarly, exclude PM emission data during 
operation involving exhaust temperature below 250 [deg]C for an engine 
equipped with an oxidizing flow-through catalyst.
    (iii) Measure exhaust temperature within 30 cm downstream of the 
last applicable catalytic aftertreatment device. Where there are 
parallel paths, use good engineering judgment to measure the 
temperature within 30 cm downstream of the last applicable catalytic 
aftertreatment device in the path with the greatest exhaust flow.
    (g) Emission sampling is not valid for NTE testing if it includes 
any active regeneration, unless the emission averaging period includes 
the complete regeneration event(s) and the full period of engine 
operation until the start of the next regeneration event. This 
provision applies only for engines that send an electronic signal 
indicating the start of the regeneration event.

0
204. Section 1042.525 is revised to read as follows:


Sec.  1042.525  How do I adjust emission levels to account for 
infrequently regenerating aftertreatment devices?

    For engines using aftertreatment technology with infrequent 
regeneration events that may occur during testing, take one of the 
following approaches to account for the emission impact of 
regeneration, or use an alternate methodology that we approve for 
Category 3 engines:
    (a) You may use the calculation methodology described in 40 CFR 
1065.680 to adjust measured emission results. Do this by developing an 
upward adjustment factor and a downward adjustment factor for each 
pollutant based on measured emission data and observed regeneration 
frequency as follows:
    (1) Adjustment factors should generally apply to an entire engine 
family, but you may develop separate adjustment factors for different 
configurations within an engine family. Use the adjustment factors from 
this section in all testing for the engine family.
    (2) You may use carryover or carry-across data to establish 
adjustment factors for an engine family as described in Sec.  1042.235, 
consistent with good engineering judgment.
    (3) Determine the frequency of regeneration, F, as described in 40 
CFR 1065.680 from in-use operating data or from running repetitive 
tests in a laboratory. If the engine is designed for regeneration at 
fixed time intervals, you may apply good engineering judgment to 
determine F based on those design parameters.
    (4) Identify the value of F in each application for certification 
for which it applies.
    (b) You may ask us to approve an alternate methodology to account 
for regeneration events. We will generally limit approval to cases 
where your engines use aftertreatment technology with extremely 
infrequent regeneration and you are unable to apply the provisions of 
this section.
    (c) You may choose to make no adjustments to measured emission 
results if you determine that regeneration does not significantly 
affect emission levels for an engine family (or configuration) or if it 
is not practical to identify when regeneration occurs. If you choose 
not to make adjustments under paragraph (a) or (b) of this section, 
your engines must meet emission standards for all testing, without 
regard to regeneration.

Subpart G--Special Compliance Provisions

0
205. Section 1042.601 is amended by revising paragraph (d) and adding 
paragraph (j) to read as follows:


Sec.  1042.601  General compliance provisions for marine engines and 
vessels.

* * * * *
    (d) The provisions of Sec.  1042.635 for the national security 
exemption apply in addition to the provisions of 40 CFR 1068.225.
* * * * *
    (j) Subpart C of this part describes how to test and certify dual-
fuel and flexible-fuel engines. Some multi-fuel engines may not fit 
either of those defined terms. For such engines, we will determine 
whether it is most appropriate to treat them as single-fuel engines, 
dual-fuel engines, or flexible-fuel engines based on the range of 
possible and expected fuel mixtures. For example, an engine might burn 
natural gas but initiate combustion with a pilot injection of diesel 
fuel. If the engine is designed to operate with a single fueling 
algorithm (i.e., fueling rates are fixed at a given engine speed and 
load condition), we would generally treat it as a single-fuel engine. 
In this context, the combination of diesel fuel and natural gas would 
be its own fuel type. If the engine is designed to also operate on 
diesel fuel alone, we would generally treat it as a dual-fuel engine. 
If the engine is designed to operate on varying mixtures of the two 
fuels, we would generally treat it as a flexible-fuel engine. To the 
extent that requirements vary for the different fuels or fuel mixtures, 
we may apply the more stringent requirements.

0
206. Section 1042.605 is amended by revising paragraph (e)(3) to read 
as follows:


Sec.  1042.605  Dressing engines already certified to other standards 
for nonroad or heavy-duty highway engines for marine use.

* * * * *
    (e) * * *
    (3) Send the Designated Compliance Officer written notification 
describing your plans before using the provisions of this section. In 
addition, by February 28 of each calendar year (or less often if we 
tell you), send the Designated Compliance Officer a signed letter with 
all the following information:
    (i) Identify your full corporate name, address, and telephone 
number.
    (ii) List the engine models for which you used this exemption in 
the previous year and describe your basis for meeting the sales 
restrictions of paragraph (d)(4) of this section.
    (iii) State: ``We prepared each listed engine model for marine 
application without making any changes that could increase its 
certified emission levels, as described in 40 CFR 1042.605.''
* * * * *

0
207. Section 1042.610 is amended by revising paragraph (e)(2) to read 
as follows:

[[Page 74151]]

Sec.  1042.610  Certifying auxiliary marine engines to land-based 
standards.

* * * * *
    (e) * * *
    (2) Send the Designated Compliance Officer written notification 
describing your plans before using the provisions of this section. In 
addition, by February 28 of each calendar year (or less often if we 
tell you), send the Designated Compliance Officer a signed letter with 
all the following information:
    (i) Identify your full corporate name, address, and telephone 
number.
    (ii) List the engine models for which you used this exemption in 
the previous year and describe your basis for meeting the sales 
restrictions of paragraph (d)(3) of this section.
    (iii) State: ``We prepared each listed engine model for marine 
application without making any changes that could increase its 
certified emission levels, as described in 40 CFR 1042.610.''
* * * * *

0
208. Section 1042.630 is amended by revising paragraph (f) to read as 
follows:


Sec.  1042.630  Personal-use exemption.

* * * * *
    (f) The vessel must be a vessel that is not classed or subject to 
Coast Guard inspections or surveys. Note that dockside examinations 
performed by the Coast Guard are not considered inspections (see 46 
U.S.C. 3301 and 46 U.S.C. 4502).

0
209. Section 1042.635 is revised to read as follows:


Sec.  1042.635   National security exemption.

    Engines qualify for a national security exemption as described in 
40 CFR 1068.225. This applies to both freshly manufactured and 
remanufactured engines.


Sec.  1042.640  [Removed]

0
210. Section 1042.640 is removed.

0
211. Section 1042.650 is amended by revising paragraphs (a) and (d) to 
read as follows:


Sec.  1042.650  Exemptions for migratory vessels and auxiliary engines 
on Category 3 vessels.

* * * * *
    (a) Temporary exemption. A vessel owner may ask us for a temporary 
exemption from the tampering prohibition in 40 CFR 1068.101(b)(1) for a 
vessel if it will operate for an extended period outside the United 
States where ULSD is not available. In your request, describe where the 
vessel will operate, how long it will operate there, why ULSD will be 
unavailable, and how you will modify the engine, including its emission 
controls. If we approve your request, you may modify the engine, but 
only as needed to disable or remove the emission controls needed for 
meeting the Tier 4 standards. You must return the engine to its 
original certified configuration before the vessel returns to the 
United States to avoid violating the tampering prohibition in 40 CFR 
1068.101(b)(1). We may set additional conditions to prevent 
circumvention of the provisions of this part.
* * * * *
    (d) Auxiliary engines on Category 3 vessels. Auxiliary engines that 
will be installed on vessels with Category 3 propulsion engines qualify 
for an exemption from the standards of this part provided all the 
following conditions are met:
    (1) To be eligible for this exemption, the engine must meet all the 
following criteria.
    (i) The engine must have an EIAPP certificate demonstrating 
compliance with the applicable NOX standards of Annex VI and 
meet all other applicable requirements of 40 CFR part 1043. Engines 
installed on vessels constructed on or after January 1, 2016 must 
conform fully to the Annex VI Tier III NOX standards as 
described in 40 CFR part 1043 and meet all other applicable 
requirements in 40 CFR part 1043. Engines that would otherwise be 
subject to the Tier 4 standards of this part must also conform fully to 
the Annex VI Tier III NOX standards as described in 40 CFR 
part 1043.
    (ii) The engine may not be used for propulsion (except for 
emergency engines).
    (iii) Engines certified to the Annex VI Tier III standards may be 
equipped with on-off NOX controls, as long as they conform 
to the requirements of Sec. Sec.  1042.110(d) and 1042.115(g); however, 
the engines must comply fully with the Annex VI Tier II standards when 
the emission controls are disabled, and meet any other requirements 
that apply under Annex VI.
    (2) You must notify the Designated Compliance Officer of your 
intent to use this exemption before you introduce engines into U.S. 
commerce, not later than the time that you apply for an EIAPP 
certificate for the engine under 40 CFR part 1043.
    (3) The remanufactured engine requirements of subpart I of this 
part do not apply.
    (4) If you introduce an engine into U.S. commerce under this 
paragraph (d), you must meet the labeling requirements in Sec.  
1042.135, but add the following statement instead of the compliance 
statement in Sec.  1042.135(c)(10):
    THIS ENGINE DOES NOT COMPLY WITH CURRENT U.S. EPA EMISSION 
STANDARDS UNDER 40 CFR 1042.650 AND IS FOR USE SOLELY IN VESSELS WITH 
CATEGORY 3 PROPULSION ENGINES. INSTALLATION OR USE OF THIS ENGINE IN 
ANY OTHER APPLICATION MAY BE A VIOLATION OF FEDERAL LAW SUBJECT TO 
CIVIL PENALTY.
    (5) The reporting requirements of Sec.  1042.660 apply for engines 
exempted under this paragraph (d).

0
212. Section 1042.655 is amended by revising the section heading and 
paragraph (b) to read as follows:


Sec.  1042.655  Special certification provisions for Category 3 engines 
with aftertreatment.

* * * * *
    (b) Required testing. The emission-data engine must be tested as 
specified in subpart F of this part to verify that the engine-out 
emissions comply with the Tier 2 standards. The catalyst material or 
other aftertreatment device must be tested under conditions that 
accurately represent actual engine conditions for the test points. This 
catalyst or aftertreatment testing may be performed on a bench scale.
* * * * *

0
213. Section 1042.660 is amended by revising paragraphs (b) and (c)(1) 
to read as follows:


Sec.  1042.660  Requirements for vessel manufacturers, owners, and 
operators.

* * * * *
    (b) For vessels equipped with SCR systems requiring the use of urea 
or other reductants, owners and operators must report to the Designated 
Enforcement Officer within 30 days any operation of such vessels 
without the appropriate reductant. This includes vessels with auxiliary 
engines certified to Annex VI standards under Sec.  1042.650(d). 
Failure to comply with the requirements of this paragraph is a 
violation of 40 CFR 1068.101(a)(2). Note that such operation is a 
violation of 40 CFR 1068.101(b)(1).
    (c) * * *
    (1) The requirements of this paragraph (c)(1) apply only for 
Category 3 engines. All maintenance, repair, adjustment, and alteration 
of Category 3 engines subject to the provisions of this part performed 
by any owner, operator or other maintenance provider must be performed 
using good engineering judgment, in such a manner that the engine 
continues (after the maintenance, repair, adjustment or alteration) to 
meet the emission standards it was certified as meeting prior to the 
need for service. This includes but is not limited to complying with 
the maintenance

[[Page 74152]]

instructions described in Sec.  1042.125. Adjustments are limited to 
the range specified by the engine manufacturer in the approved 
application for certification. Note that where a repair (or other 
maintenance) cannot be completed while at sea, it is not a violation to 
continue operating the engine to reach your destination.
* * * * *

0
214. Section 1042.670 is amended by revising paragraph (d) to read as 
follows:


Sec.  1042.670  Special provisions for gas turbine engines.

* * * * *
    (d) Equivalent displacement. Apply displacement-based provisions of 
this part by calculating an equivalent displacement from maximum engine 
power. The equivalent per-cylinder displacement (in liters) equals 
maximum engine power in kW multiplied by 0.00311, except that all gas 
turbines with maximum engine power above 9,300 kW are considered to 
have an equivalent per-cylinder displacement of 29.0 liters. Also, 
determine the appropriate Tier 3 standards for Category 1 engines based 
on the engine having an equivalent power density below 35 kW per liter.
* * * * *

Subpart H--Averaging, Banking, and Trading for Certification

0
215. Section 1042.701 is amended by adding paragraphs (j) and (k) to 
read as follows:


Sec.  1042.701  General provisions.

* * * * *
    (j) NOx+HC and PM credits generated under 40 CFR part 94 
may be used under this part in the same manner as NOx+HC and 
PM credits generated under this part.
    (k) You may use either of the following approaches to retire or 
forego emission credits:
    (1) You may retire emission credits generated from any number of 
your engines. This may be considered donating emission credits to the 
environment. Identify any such credits in the reports described in 
Sec.  1042.730. Engines must comply with the applicable FELs even if 
you donate or sell the corresponding emission credits under this 
paragraph (k). Those credits may no longer be used by anyone to 
demonstrate compliance with any EPA emission standards.
    (2) You may certify a family using an FEL below the emission 
standard as described in this part and choose not to generate emission 
credits for that family. If you do this, you do not need to calculate 
emission credits for those families and you do not need to submit or 
keep the associated records described in this subpart for that family.

0
216. Section 1042.705 is amended by revising paragraph (c) to read as 
follows:


Sec.  1042.705  Generating and calculating emission credits.

* * * * *
    (c) As described in Sec.  1042.730, compliance with the 
requirements of this subpart is determined at the end of the model year 
based on actual U.S.-directed production volumes. Do not include any of 
the following engines to calculate emission credits:
    (1) Engines with a permanent exemption under subpart G of this part 
or under 40 CFR part 1068.
    (2) Exported engines.
    (3) Engines not subject to the requirements of this part, such as 
those excluded under Sec.  1042.5.
    (4) [Reserved]
    (5) Any other engines, where we indicate elsewhere in this part 
1042 that they are not to be included in the calculations of this 
subpart.

0
217. Section 1042.710 is amended by revising paragraph (c) to read as 
follows:


Sec.  1042.710  Averaging emission credits.

* * * * *
    (c) If you certify an engine family to an FEL that exceeds the 
otherwise applicable emission standard, you must obtain enough emission 
credits to offset the engine family's deficit by the due date for the 
final report required in Sec.  1042.730. The emission credits used to 
address the deficit may come from your other engine families that 
generate emission credits in the same model year, from emission credits 
you have banked from previous model years, or from emission credits 
generated in the same or previous model years that you obtained through 
trading.

0
218. Section 1042.725 is amended by revising paragraph (b)(2) to read 
as follows:


Sec.  1042.725  Information required for the application for 
certification.

* * * * *
    (b) * * *
    (2) Detailed calculations of projected emission credits (positive 
or negative) based on projected production volumes. We may require you 
to include similar calculations from your other engine families to 
demonstrate that you will be able to avoid negative credit balances for 
the model year. If you project negative emission credits for a family, 
state the source of positive emission credits you expect to use to 
offset the negative emission credits.

0
219. Section 1042.730 is amended by revising paragraphs (b), (c)(2), 
and (d) to read as follows:


Sec.  1042.730  ABT reports.

* * * * *
    (b) Your end-of-year and final reports must include the following 
information for each engine family participating in the ABT program:
    (1) Engine-family designation and averaging set.
    (2) The emission standards that would otherwise apply to the engine 
family.
    (3) The FEL for each pollutant. If you change the FEL after the 
start of production, identify the date that you started using the new 
FEL and/or give the engine identification number for the first engine 
covered by the new FEL. In this case, identify each applicable FEL and 
calculate the positive or negative emission credits as specified in 
Sec.  1042.225.
    (4) The projected and actual U.S.-directed production volumes for 
the model year, as described in Sec.  1042.705(c). If you changed an 
FEL during the model year, identify the actual U.S.-directed production 
volume associated with each FEL.
    (5) Maximum engine power for each engine configuration, and the 
average engine power weighted by U.S.-directed production volumes for 
the engine family.
    (6) Useful life.
    (7) Calculated positive or negative emission credits for the whole 
engine family. Identify any emission credits that you traded, as 
described in paragraph (d)(1) of this section.
    (c) * * *
    (2) State whether you will retain any emission credits for banking. 
If you choose to retire emission credits that would otherwise be 
eligible for banking, identify the engine families that generated the 
emission credits, including the number of emission credits from each 
family.
* * * * *
    (d) If you trade emission credits, you must send us a report within 
90 days after the transaction, as follows:
    (1) As the seller, you must include the following information in 
your report:
    (i) The corporate names of the buyer and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) The averaging set corresponding to the engine families that 
generated emission credits for the trade, including the number of 
emission credits from each averaging set.

[[Page 74153]]

    (2) As the buyer, you must include the following information in 
your report:
    (i) The corporate names of the seller and any brokers.
    (ii) A copy of any contracts related to the trade.
    (iii) How you intend to use the emission credits, including the 
number of emission credits you intend to apply for each averaging set.
* * * * *

0
220. Section 1042.735 is amended by revising paragraphs (a) and (b) to 
read as follows:


Sec.  1042.735  Recordkeeping.

    (a) You must organize and maintain your records as described in 
this section.
    (b) Keep the records required by this section for at least eight 
years after the due date for the end-of-year report. You may not use 
emission credits for any engines if you do not keep all the records 
required under this section. You must therefore keep these records to 
continue to bank valid credits.
* * * * *

Subpart I--Special Provisions for Remanufactured Marine Engines

0
221. Section 1042.810 is amended by revising paragraph (c) to read as 
follows:


Sec.  1042.810  Requirements for owner/operators and installers during 
remanufacture.

* * * * *
    (c) Your engine is not subject to the standards of this subpart if 
we determine that no certified remanufacturing system is available for 
your engine as described in Sec.  1042.815. For engines that are 
remanufactured during multiple events within a five-year period, you 
are not required to use a certified system until all of your engine's 
cylinders have been replaced after the system became available. For 
example, if you remanufacture your 16-cylinder engine by replacing four 
cylinders each January and a system becomes available for your engine 
June 1, 2010, your engine must be in a certified configuration when you 
replace four cylinders in January of 2014. At that point, all 16 
cylinders would have been replaced after June 1, 2010.
* * * * *

0
222. Section 1042.830 is revised to read as follows:


Sec.  1042.830  Labeling.

    (a) The labeling requirements of this paragraph (a) apply for 
remanufacturing that is subject to the standards of this subpart. At 
the time of remanufacture, affix a permanent and legible label 
identifying each engine. The label must be--
    (1) Attached in one piece so it is not removable without being 
destroyed or defaced.
    (2) Secured to a part of the engine needed for normal operation and 
not normally requiring replacement.
    (3) Durable and readable for the engine's entire useful life.
    (4) Written in English.
    (b) The label required under paragraph (a) of this section must--
    (1) Include the heading ``EMISSION CONTROL INFORMATION''.
    (2) Include your full corporate name and trademark.
    (3) Include EPA's standardized designation for the engine family.
    (4) State the engine's category, displacement (in liters or L/cyl), 
maximum engine power (in kW), and power density (in kW/L) as needed to 
determine the emission standards for the engine family. You may specify 
displacement, maximum engine power, and power density as ranges 
consistent with the ranges listed in Sec.  1042.101. See Sec.  1042.140 
for descriptions of how to specify per-cylinder displacement, maximum 
engine power, and power density.
    (5) State: ``THIS MARINE ENGINE MEETS THE STANDARDS OF 40 CFR PART 
1042, SUBPART I, FOR [CALENDAR YEAR OF REMANUFACTURE].''
    (c) For remanufactured engines that are subject to this subpart as 
described in Sec.  1042.801(a), but are not subject to remanufacturing 
standards as allowed by Sec.  1042.810 or Sec.  1042.815, you may 
voluntarily add a label as specified in paragraphs (a) and (b) of this 
section, except that the label must omit the standardized designation 
for the engine family and include the following alternative compliance 
statement: ``THIS MARINE ENGINE IS NOT SUBJECT TO REMANUFACTURING 
STANDARDS UNDER 40 CFR PART 1042, SUBPART I, FOR [CALENDAR YEAR OF 
REMANUFACTURE].''
    (d) You may add information to the emission control information 
label to identify other emission standards that the engine meets or 
does not meet (such as international standards). You may also add other 
information to ensure that the engine will be properly maintained and 
used.
    (e) You may ask us to approve modified labeling requirements in 
this section if you show that it is necessary or appropriate. We will 
approve your request if your alternate label is consistent with the 
intent of the labeling requirements of this section.

0
223. Section 1042.836 is amended by revising paragraph (c)(1) to read 
as follows:


Sec.  1042.836   Marine certification of locomotive remanufacturing 
systems.

* * * * *
    (c) * * *
    (1) Tier 0 locomotive systems may not be used for any Category 1 
engines or Tier 1 or later Category 2 engines.
* * * * *

0
224. Section 1042.840 is amended by revising paragraphs (c) and (o) to 
read as follows:


Sec.  1042.840  Application requirements for remanufactured engines.

* * * * *
    (c) Summarize the cost effectiveness analysis used to demonstrate 
your system will meet the availability criteria of Sec.  1042.815. 
Identify the maximum allowable costs for vessel modifications to meet 
these criteria.
* * * * *
    (o) Report all valid test results. Also indicate whether there are 
test results from invalid tests or from any other tests of the 
emission-data engine, whether or not they were conducted according to 
the test procedures of subpart F of this part. If you measure 
CO2, report those emission levels. We may require you to 
report these additional test results. We may ask you to send other 
information to confirm that your tests were valid under the 
requirements of this part and 40 CFR part 1065.
* * * * *

0
225. Section 1042.850 is amended by revising the introductory text to 
read as follows:


Sec.  1042.850  Exemptions and hardship relief.

    This section describes exemption and hardship provisions that are 
available for owner/operators of engines subject to the provisions of 
this subpart.
* * * * *

Subpart J--Definitions and Other Reference Information

0
226. Section 1042.901 is amended as follows:
0
a. By revising the definition of ``Designated Compliance Officer''.
0
b. By adding definitions for ``Designated Enforcement Officer'', 
``Dual-fuel'', and ``Flexible-fuel'' in alphabetical order.
0
c. By revising the definitions for ``Low-sulfur diesel fuel'', ``Model 
year'', and ``Placed into service''.
0
d. By removing the definition for ``Point of first retail sale''.

[[Page 74154]]

0
e. By revising the definition of ``Sulfur-sensitive technology''.
    The revisions and additions read as follows:


Sec.  1042.901  Definitions.

* * * * *
    Designated Compliance Officer means the Director, Diesel Engine 
Compliance Center, U.S. Environmental Protection Agency, 2000 
Traverwood Drive, Ann Arbor, MI 48105; [email protected]; epa.gov/otaq/verify.
    Designated Enforcement Officer means the Director, Air Enforcement 
Division (2242A), U.S. Environmental Protection Agency, 1200 
Pennsylvania Ave. NW., Washington, DC 20460.
* * * * *
    Dual-fuel means relating to an engine designed for operation on two 
different fuels but not on a continuous mixture of those fuels (see 
Sec.  1042.601(j)). For purposes of this part, such an engine remains a 
dual-fuel engine even if it is designed for operation on three or more 
different fuels. Note that this definition differs from MARPOL Annex 
VI.
* * * * *
    Flexible-fuel means relating to an engine designed for operation on 
any mixture of two or more different fuels (see Sec.  1042.601(j)).
* * * * *
    Low-sulfur diesel fuel means one of the following:
    (1) For in-use fuels, low-sulfur diesel fuel means a diesel fuel 
marketed as low-sulfur diesel fuel having a maximum sulfur 
concentration of 500 parts per million.
    (2) For testing, low-sulfur diesel fuel has the meaning given in 40 
CFR part 1065.
* * * * *
    Model year means any of the following:
    (1) For freshly manufactured marine engines (see definition of 
``new marine engine,'' paragraph (1)), model year means one of the 
following:
    (i) Calendar year of production.
    (ii) Your annual new model production period if it is different 
than the calendar year. This must include January 1 of the calendar 
year for which the model year is named. It may not begin before January 
2 of the previous calendar year and it must end by December 31 of the 
named calendar year. For seasonal production periods not including 
January 1, model year means the calendar year in which the production 
occurs, unless you choose to certify the applicable engine family with 
the following model year. For example, if your production period is 
June 1, 2010 through November 30, 2010, your model year would be 2010 
unless you choose to certify the engine family for model year 2011.
    (2) For an engine that is converted to a marine engine after being 
certified and placed into service as a motor vehicle engine, a nonroad 
engine that is not a marine engine, or a stationary engine, model year 
means the calendar year in which the engine was originally produced. 
For an engine that is converted to a marine engine after being placed 
into service as a motor vehicle engine, a nonroad engine that is not a 
marine engine, or a stationary engine without having been certified, 
model year means the calendar year in which the engine becomes a new 
marine engine. (See definition of ``new marine engine,'' paragraph 
(2)).
    (3) For an uncertified marine engine excluded under Sec.  1042.5 
that is later subject to this part 1042 as a result of being installed 
in a different vessel, model year means the calendar year in which the 
engine was installed in the non-excluded vessel. For a marine engine 
excluded under Sec.  1042.5 that is later subject to this part 1042 as 
a result of reflagging the vessel, model year means the calendar year 
in which the engine was originally manufactured. For a marine engine 
that become new under paragraph (7) of the definition of ``new marine 
engine,'' model year means the calendar year in which the engine was 
originally manufactured. (See definition of ``new marine engine,'' 
paragraphs (3) and (7).)
    (4) For engines that do not meet the definition of ``freshly 
manufactured'' but are installed in new vessels, model year means the 
calendar year in which the engine is installed in the new vessel (see 
definition of ``new marine engine,'' paragraph (4)).
    (5) For remanufactured engines, model year means the calendar year 
in which the remanufacture takes place.
    (6) For imported engines:
    (i) For imported engines described in paragraph (6)(i) of the 
definition of ``new marine engine,'' model year has the meaning given 
in paragraphs (1) through (4) of this definition.
    (ii) For imported engines described in paragraph (6)(ii) of the 
definition of ``new marine engine,'' model year means the calendar year 
in which the engine is remanufactured.
    (iii) For imported engines described in paragraph (6)(iii) of the 
definition of ``new marine engine,'' model year means the calendar year 
in which the engine is first assembled in its imported configuration, 
unless specified otherwise in this part or in 40 CFR part 1068.
    (iv) For imported engines described in paragraph (6)(iv) of the 
definition of ``new marine engine,'' model year means the calendar year 
in which the engine is imported.
    (7) [Reserved]
    (8) For freshly manufactured vessels, model year means the calendar 
year in which the keel is laid or the vessel is at a similar stage of 
construction. For vessels that become new under paragraph (2) or (3) of 
the definition of ``new vessel'' (as a result of modifications), model 
year means the calendar year in which the modifications physically 
begin.
* * * * *
    Placed into service means put into initial use for its intended 
purpose. Engines and vessels do not qualify as being ``placed into 
service'' based on incidental use by a manufacturer or dealer.
* * * * *
    Sulfur-sensitive technology means an emission control technology 
that experiences a significant drop in emission control performance or 
emission-system durability when an engine is operated on low-sulfur 
diesel fuel (i.e., fuel with a sulfur concentration of 300 to 500 ppm) 
as compared to when it is operated on ultra-low sulfur diesel fuel 
(i.e., fuel with a sulfur concentration less than 15 ppm). Exhaust gas 
recirculation is not a sulfur-sensitive technology.
* * * * *

0
227. Section 1042.905 is revised to read as follows:


Sec.  1042.905  Symbols, acronyms, and abbreviations.

    The following symbols, acronyms, and abbreviations apply to this 
part:

ABT Averaging, banking, and trading.
AECD auxiliary emission control device.
CFR Code of Federal Regulations.
CH4 methane.
CO carbon monoxide.
CO2 carbon dioxide.
cyl cylinder.
disp. displacement.
ECA Emission Control Area.
EEZ Exclusive Economic Zone.
EPA Environmental Protection Agency.
FEL Family Emission Limit.
g grams.
HC hydrocarbon.
hr hours.
IMO International Maritime Organization.
kPa kilopascals.
kW kilowatts.
L liters.
LTR Limited Testing Region.

[[Page 74155]]

N2O nitrous oxide.
NARA National Archives and Records Administration.
NMHC nonmethane hydrocarbon.
NOX oxides of nitrogen (NO and NO2).
NTE not-to-exceed.
PM particulate matter.
RPM revolutions per minute.
SAE Society of Automotive Engineers.
SCR selective catalytic reduction.
THC total hydrocarbon.
THCE total hydrocarbon equivalent.
ULSD ultra low-sulfur diesel fuel.
U.S.C. United States Code.


0
228. Section 1042.910 is revised to read as follows:


Sec.  1042.910  Incorporation by reference.

    (a) Certain material is incorporated by reference into this part 
with the approval of the Director of the Federal Register under 5 
U.S.C. 552(a) and 1 CFR part 51. To enforce any edition other than that 
specified in this section, the Environmental Protection Agency must 
publish a document in the Federal Register and the material must be 
available to the public. All approved material is available for 
inspection at U.S. EPA, Air and Radiation Docket and Information 
Center, 1301 Constitution Ave. NW., Room B102, EPA West Building, 
Washington, DC 20460, (202) 202-1744, and is available from the sources 
listed below. It is also available for inspection at the National 
Archives and Records Administration (NARA). For information on the 
availability of this material at NARA, call 202-741-6030, or go to: 
http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.
    (b) The International Maritime Organization, 4 Albert Embankment, 
London SE1 7SR, United Kingdom, or www.imo.org, or 44-(0)20-7735-7611.
    (1) MARPOL Annex VI, Regulations for the Prevention of Air 
Pollution from Ships, Third Edition, 2013, and NOX Technical 
Code 2008.
    (i) Revised MARPOL Annex VI, Regulations for the Prevention of 
Pollution from Ships, Third Edition, 2013 (``2008 Annex VI''); IBR 
approved for Sec.  1042.901.
    (ii) NOX Technical Code 2008, Technical Code on Control 
of Emission of Nitrogen Oxides from Marine Diesel Engines, 2013 
Edition, (``NOX Technical Code''); IBR approved for 
Sec. Sec.  1042.104(g), 1042.230(d), 1042.302(c) and (e), 1042.501(g), 
and 1042.901.
    (iii) Annex 12, Resolution MEPC.251(66) from the Report of the 
Marine Environment Protection Committee on its Sixty-Sixth Session, 
April 25, 2014. This document describes new and revised provisions that 
are considered to be part of Annex VI and NOX Technical Code 
2008 as referenced in paragraphs (b)(1)(i) and (ii) of this section. 
IBR approved for Sec. Sec.  1042.104(g), 1042.230(d), 1042.302(c) and 
(e), 1042.501(g), and 1042.901.
    (2) [Reserved]

0
229. Section 1042.915 is revised to read as follows:


Sec.  1042.915  Confidential information.

    The provisions of 40 CFR 1068.10 apply for information you consider 
confidential.

0
230. Section 1042.925 is revised to read as follows:


Sec.  1042.925  Reporting and recordkeeping requirements.

    (a) This part includes various requirements to submit and record 
data or other information. Unless we specify otherwise, store required 
records in any format and on any media and keep them readily available 
for eight years after you send an associated application for 
certification, or eight years after you generate the data if they do 
not support an application for certification. You are expected to keep 
your own copy of required records rather than relying on someone else 
to keep records on your behalf. We may review these records at any 
time. You must promptly send us organized, written records in English 
if we ask for them. We may require you to submit written records in an 
electronic format.
    (b) The regulations in Sec.  1042.255, 40 CFR 1068.25, and 40 CFR 
1068.101 describe your obligation to report truthful and complete 
information. This includes information not related to certification. 
Failing to properly report information and keep the records we specify 
violates 40 CFR 1068.101(a)(2), which may involve civil or criminal 
penalties.
    (c) Send all reports and requests for approval to the Designated 
Compliance Officer (see Sec.  1042.801).
    (d) Any written information we require you to send to or receive 
from another company is deemed to be a required record under this 
section. Such records are also deemed to be submissions to EPA. We may 
require you to send us these records whether or not you are a 
certificate holder.
    (e) Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq), the 
Office of Management and Budget approves the reporting and 
recordkeeping specified in the applicable regulations. The following 
items illustrate the kind of reporting and recordkeeping we require for 
engines and vessels regulated under this part:
    (1) We specify the following requirements related to engine 
certification in this part 1042:
    (i) In Sec.  1042.135 we require engine manufacturers to keep 
certain records related to duplicate labels sent to vessel 
manufacturers.
    (ii) In Sec.  1042.145 we include various reporting and 
recordkeeping requirements related to interim provisions.
    (iii) In subpart C of this part we identify a wide range of 
information required to certify engines.
    (iv) In Sec. Sec.  1042.345 and 1042.350 we specify certain records 
related to production-line testing.
    (v) In subpart G of this part we identify several reporting and 
recordkeeping items for making demonstrations and getting approval 
related to various special compliance provisions.
    (vi) In Sec. Sec.  1042.725, 1042.730, and 1042.735 we specify 
certain records related to averaging, banking, and trading.
    (vii) In subpart I of this part we specify certain records related 
to meeting requirements for remanufactured engines.
    (2) We specify the following requirements related to testing in 40 
CFR part 1065:
    (i) In 40 CFR 1065.2 we give an overview of principles for 
reporting information.
    (ii) In 40 CFR 1065.10 and 1065.12 we specify information needs for 
establishing various changes to published test procedures.
    (iii) In 40 CFR 1065.25 we establish basic guidelines for storing 
test information.
    (iv) In 40 CFR 1065.695 we identify the specific information and 
data items to record when measuring emissions.
    (3) We specify the following requirements related to the general 
compliance provisions in 40 CFR part 1068:
    (i) In 40 CFR 1068.5 we establish a process for evaluating good 
engineering judgment related to testing and certification.
    (ii) In 40 CFR 1068.25 we describe general provisions related to 
sending and keeping information.
    (iii) In 40 CFR 1068.27 we require manufacturers to make engines 
available for our testing or inspection if we make such a request.
    (iv) In 40 CFR 1068.105 we require vessel manufacturers to keep 
certain records related to duplicate labels from engine manufacturers.
    (v) In 40 CFR 1068.120 we specify recordkeeping related to 
rebuilding engines.

[[Page 74156]]

    (vi) In 40 CFR part 1068, subpart C, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to various exemptions.
    (vii) In 40 CFR part 1068, subpart D, we identify several reporting 
and recordkeeping items for making demonstrations and getting approval 
related to importing engines.
    (viii) In 40 CFR 1068.450 and 1068.455 we specify certain records 
related to testing production-line engines in a selective enforcement 
audit.
    (ix) In 40 CFR 1068.501 we specify certain records related to 
investigating and reporting emission-related defects.
    (x) In 40 CFR 1068.525 and 1068.530 we specify certain records 
related to recalling nonconforming engines.
    (xi) In 40 CFR part 1068, subpart G, we specify certain records for 
requesting a hearing.

0
231. Appendix II to Part 1042 is revised to read as follows:

Appendix II to Part 1042--Steady-State Duty Cycles

    (a) The following duty cycles apply as specified in Sec.  
1042.505(b)(1):
    (1) The following duty cycle applies for discrete-mode testing:

----------------------------------------------------------------------------------------------------------------
                                                                                    Percent of
                  E3 mode No.                           Engine speed \1\           maximum  test     Weighting
                                                                                       power          factors
----------------------------------------------------------------------------------------------------------------
1.............................................  Maximum test speed..............             100             0.2
2.............................................  91%.............................              75             0.5
3.............................................  80%.............................              50            0.15
4.............................................  63%.............................              25            0.15
----------------------------------------------------------------------------------------------------------------
\1\ Maximum test speed is defined in 40 CFR part 1065. Percent speed values are relative to maximum test speed.

    (2) The following duty cycle applies for ramped-modal testing:

----------------------------------------------------------------------------------------------------------------
                                           Time in mode
                RMC mode                     (seconds)         Engine speed 1 3           Power (percent) 2 3
----------------------------------------------------------------------------------------------------------------
1a Steady-state.........................             229  Maximum test speed........  100%.
1b Transition...........................              20  Linear transition.........  Linear transition in
                                                                                       torque.
2a Steady-state.........................             166  63%.......................  25%.
2b Transition...........................              20  Linear transition.........  Linear transition in
                                                                                       torque.
3a Steady-state.........................             570  91%.......................  75%.
3b Transition...........................              20  Linear transition.........  Linear transition in
                                                                                       torque.
4a Steady-state.........................             175  80%.......................  50%.
----------------------------------------------------------------------------------------------------------------
\1\ Maximum test speed is defined in 40 CFR part 1065. Percent speed is relative to maximum test speed.
\2\ The percent power is relative to the maximum test power.
\3\ Advance from one mode to the next within a 20 second transition phase. During the transition phase, command
  a linear progression from the torque setting of the current mode to the torque setting of the next mode, and
  simultaneously command a similar linear progression for engine speed if there is a change in speed setting.

    (b) The following duty cycles apply as specified in Sec.  
1042.505(b)(2):
    (1) The following duty cycle applies for discrete-mode testing:

----------------------------------------------------------------------------------------------------------------
                                                                                    Percent of
                  E5 mode No.                           Engine speed \1\           maximum  test     Weighting
                                                                                       power          factors
----------------------------------------------------------------------------------------------------------------
1.............................................  Maximum test speed..............             100            0.08
2.............................................  91%.............................              75            0.13
3.............................................  80%.............................              50            0.17
4.............................................  63%.............................              25            0.32
5.............................................  Warm idle.......................               0             0.3
----------------------------------------------------------------------------------------------------------------
\1\ Maximum test speed is defined in 40 CFR part 1065. Percent speed values are relative to maximum test speed.

    (2) The following duty cycle applies for ramped-modal testing:

----------------------------------------------------------------------------------------------------------------
                                           Time in mode
                RMC mode                     (seconds)         Engine speed 1 3           Power (percent) 2 3
----------------------------------------------------------------------------------------------------------------
1a Steady-state.........................             167  Warm idle.................  0.
1b Transition...........................              20  Linear transition.........  Linear transition in
                                                                                       torque.
2a Steady-state.........................              85  Maximum test speed........  100%.
2b Transition...........................              20  Linear transition.........  Linear transition in
                                                                                       torque.
3a Steady-state.........................             354  63%.......................  25%.
3b Transition...........................              20  Linear transition.........  Linear transition in
                                                                                       torque.
4a Steady-state.........................             141  91%.......................  75%.
4b Transition...........................              20  Linear transition.........  Linear transition in
                                                                                       torque.
5a Steady-state.........................             182  80%.......................  50%.

[[Page 74157]]

 
5b Transition...........................              20  Linear transition.........  Linear transition in
                                                                                       torque.
6 Steady-state..........................             171  Warm idle.................  0.
----------------------------------------------------------------------------------------------------------------
\1\ Maximum test speed is defined in 40 CFR part 1065. Percent speed is relative to maximum test speed.
\2\ The percent power is relative to the maximum test power.
\3\ Advance from one mode to the next within a 20 second transition phase. During the transition phase, command
  a linear progression from the torque setting of the current mode to the torque setting of the next mode, and
  simultaneously command a similar linear progression for engine speed if there is a change in speed setting.

    (c) The following duty cycles apply as specified in Sec.  
1042.505(b)(3):
    (1) The following duty cycle applies for discrete-mode testing:

----------------------------------------------------------------------------------------------------------------
                                                                                      Torque         Weighting
                  E2 mode No.                           Engine speed \1\           (percent) \2\      factors
----------------------------------------------------------------------------------------------------------------
1.............................................  Engine Governed.................             100             0.2
2.............................................  Engine Governed.................              75             0.5
3.............................................  Engine Governed.................              50            0.15
4.............................................  Engine Governed.................              25            0.15
----------------------------------------------------------------------------------------------------------------
\1\ Speed terms are defined in 40 CFR part 1065.
\2\ The percent torque is relative to the maximum test torque as defined in 40 CFR part 1065.

    (2) The following duty cycle applies for ramped-modal testing:

----------------------------------------------------------------------------------------------------------------
                                        Time in mode
               RMC mode                   (seconds)          Engine speed              Torque (percent)1 2
----------------------------------------------------------------------------------------------------------------
1a Steady-state......................             229  Engine Governed........  100%.
1b Transition........................              20  Engine Governed........  Linear transition.
2a Steady-state......................             166  Engine Governed........  25%.
2b Transition........................              20  Engine Governed........  Linear transition.
3a Steady-state......................             570  Engine Governed........  75%.
3b Transition........................              20  Engine Governed........  Linear transition.
4a Steady-state......................             175  Engine Governed........  50%.
----------------------------------------------------------------------------------------------------------------
\1\ The percent torque is relative to the maximum test torque as defined in 40 CFR part 1065.
\2\ Advance from one mode to the next within a 20 second transition phase. During the transition phase, command
  a linear progression from the torque setting of the current mode to the torque setting of the next mode.


0
232. Appendix III to Part 1042 is revised to read as follows:

Appendix III to Part 1042--Not-to-Exceed Zones

    (a) The following definitions apply for this Appendix III:
    (1) Percent power means the percentage of the maximum power 
achieved at Maximum Test Speed (or at Maximum Test Torque for 
constant-speed engines).
    (2) Percent speed means the percentage of Maximum Test Speed.
    (b) Figure 1 of this Appendix illustrates the default NTE zone 
for marine engines certified using the duty cycle specified in Sec.  
1042.505(b)(1), except for variable-speed propulsion marine engines 
used with controllable-pitch propellers or with electrically coupled 
propellers, as follows:
    (1) Subzone 1 is defined by the following boundaries:
    (i) Percent power / 100 > 0.7 [middot] (percent speed / 100) 
\2.5\.
    (ii) Percent power / 100 <= (percent speed / 90) \3.5\.
    (iii) Percent power / 100 >= 3.0 [middot] (1-percent speed / 
100).
    (2) Subzone 2 is defined by the following boundaries:
    (i) Percent power / 100 >= 0.7 [middot] (percent speed / 100) 
\2.5\.
    (ii) Percent power / 100 <= (percent speed / 90) \3.5\.
    (iii) Percent power / 100 < 3.0 [middot] (1-percent speed / 
100).
    (iv) Percent speed / 100 >= 0.7.
    (3) Note that the line separating Subzone 1 and Subzone 2 
includes the following endpoints:
    (i) Percent speed = 78.9 percent; Percent power = 63.2 percent.
    (ii) Percent speed = 84.6 percent; Percent power = 46.1 percent.

[[Page 74158]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.153

    (c) Figure 2 of this Appendix illustrates the default NTE zone 
for recreational marine engines certified using the duty cycle 
specified in Sec.  1042.505(b)(2), except for variable-speed marine 
engines used with controllable-pitch propellers or with electrically 
coupled propellers, as follows:
    (1) Subzone 1 is defined by the following boundaries:
    (i) Percent power / 100 >= 0.7 [middot] (percent speed / 100) 
\2.5\.
    (ii) Percent power / 100 <= (percent speed / 90) \3.5\.
    (iii) Percent power / 100 >= 3.0 [middot] (1-percent speed / 
100).
    (iv) Percent power <= 95 percent.
    (2) Subzone 2 is defined by the following boundaries:
    (i) Percent power / 100 >= 0.7 [middot] (percent speed / 100) 
\2.5\.
    (ii) Percent power / 100 <= (percent speed / 90) \3.5\.
    (iii) Percent power / 100 < 3.0 [middot] (1-percent speed / 
100).
    (iv) Percent speed >= 70 percent.
    (3) Subzone 3 is defined by the following boundaries:
    (i) Percent power / 100 <= (percent speed / 90) \3.5\.
    (ii) Percent power > 95 percent.
    (4) Note that the line separating Subzone 1 and Subzone 3 
includes a point at Percent speed = 88.7 percent and Percent power = 
95.0 percent. See paragraph (b)(3) of this appendix regarding the 
line separating Subzone 1 and Subzone 2.

[[Page 74159]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.154

    (d) Figure 3 of this Appendix illustrates the default NTE zone 
for variable-speed marine engines used with controllable-pitch 
propellers or with electrically coupled propellers that are 
certified using the duty cycle specified in Sec.  1042.505(b)(1), 
(2), or (3), as follows:
    (1) Subzone 1 is defined by the following boundaries:
    (i) Percent power / 100 >= 0.7 [middot] (percent speed / 100) 
\2.5\.
    (ii) Percent power / 100 >= 3.0 [middot] (1-percent speed / 
100).
    (iii) Percent speed >= 78.9 percent.
    (2) Subzone 2a is defined by the following boundaries:
    (i) Percent power / 100 >= 0.7 [middot] (percent speed / 100) 
\2.5\.
    (ii) Percent speed >=70 percent.
    (iii) Percent speed <78.9 percent, for Percent power >63.3 
percent.
    (iv) Percent power / 100 <3.0 [middot] (1-percent speed / 100), 
for Percent speed >=78.9 percent.
    (3) Subzone 2b is defined by the following boundaries:
    (i) The line formed by connecting the following two points on a 
plot of speed-vs.-power:
    (A) Percent speed = 70 percent; Percent power = 28.7 percent.
    (B) Percent power = 40 percent; Speed = governed speed.
    (ii) Percent power / 100 < 0.7 [middot] (percent speed / 
100)\2.5\.
    (4) Note that the line separating Subzone 1 and Subzone 2a 
includes the following endpoints:
    (i) Percent speed = 78.9 percent; Percent power = 63.3 percent.
    (ii) Percent speed = 84.6 percent; Percent power = 46.1 percent.

[[Page 74160]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.155

    (e) Figure 4 of this Appendix illustrates the default NTE zone 
for constant-speed engines certified using a duty cycle specified in 
Sec.  1042.505(b)(3) or (4), as follows:
    (1) Subzone 1 is defined by the following boundaries:
    (i) Percent power >=70 percent.
    (ii) [Reserved]
    (2) Subzone 2 is defined by the following boundaries:
    (i) Percent power <70 percent.
    (ii) Percent power >=40 percent.
    [GRAPHIC] [TIFF OMITTED] TR25OC16.156
    

[[Page 74161]]


    (f) Figure 5 of this Appendix illustrates the default NTE zone 
for variable-speed auxiliary marine engines certified using the duty 
cycle specified in Sec.  1042.505(b)5)(ii) or (iii), as follows:
    (1) The default NTE zone is defined by the boundaries specified 
in 40 CFR 86.1370(b)(1), (2), and (4).
    (2) A special PM subzone is defined in 40 CFR 1039.515(b).
    [GRAPHIC] [TIFF OMITTED] TR25OC16.157
    
PART 1043--CONTROL OF NOX, SOX, AND PM 
EMISSIONS FROM MARINE ENGINES AND VESSELS SUBJECT TO THE MARPOL 
PROTOCOL

0
233. The authority citation for part 1043 continues to read as follows:

    Authority: 33 U.S.C. 1901-1912.


0
234. Section 1043.60 is amended by revising paragraph (a) introductory 
text to read as follows:


Sec.  1043.60  Operating requirements for engines and vessels subject 
to this part.

* * * * *
    (a) Except as specified otherwise in this part, NOX 
emission limits apply to all engines with power output of more than 130 
kW that will be installed on vessels subject to this part as specified 
in the following table:
* * * * *

0
235. Section 1043.100 is revised to read as follows:


Sec.  1043.100  Incorporation by reference.

    (a) Certain material is incorporated by reference into this part 
with the approval of the Director of the Federal Register under 5 
U.S.C. 552(a) and 1 CFR part 51. To enforce any edition other than that 
specified in this section, the Environmental Protection Agency must 
publish a document in the Federal Register and the material must be 
available to the public. All approved material is available for 
inspection at U.S. EPA, Air and Radiation Docket and Information 
Center, 1301 Constitution Ave. NW., Room B102, EPA West Building, 
Washington, DC 20460, (202) 202-1744, and is available from the sources 
listed below. It is also available for inspection at the National 
Archives and Records Administration (NARA). For information on the 
availability of this material at NARA, call 202-741-6030, or go to: 
http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.
    (b) The International Maritime Organization, 4 Albert Embankment, 
London SE1 7SR, United Kingdom, or www.imo.org, or 44-(0)20-7735-7611.
    (1) MARPOL Annex VI, Regulations for the Prevention of Air 
Pollution from Ships, Third Edition, 2013, and NOX Technical 
Code 2008.
    (i) Revised MARPOL Annex VI, Regulations for the Prevention of 
Pollution from Ships, Third Edition, 2013 (``2008 Annex VI''); IBR 
approved for Sec. Sec.  1043.1 introductory text, 1043.20, 1043.30(f), 
1043.60(c), and 1043.70(a).
    (ii) NOX Technical Code 2008, Technical Code on Control 
of Emission of Nitrogen Oxides from Marine Diesel Engines, 2013 
Edition, (``NOX Technical Code''); IBR approved for 
Sec. Sec.  1043.20, 1043.41(b) and (h), and 1043.70(a).
    (iii) Annex 12, Resolution MEPC.251(66) from the Report of the 
Marine Environment Protection Committee on its Sixty-Sixth Session, 
April 25, 2014. This document describes new and revised provisions that 
are considered to be part of Annex VI and NOX Technical Code 
2008 as referenced in paragraphs (b)(1)(i) and (ii) of this section. 
IBR approved for Sec. Sec.  1043.1 introductory text, 1043.20, 
1043.30(f), 1043.41(b) and (h), 1043.60(c), and 1043.70(a).
    (2) [Reserved]

[[Page 74162]]

PART 1065--ENGINE-TESTING PROCEDURES

0
236. The authority citation for part 1065 continues to read as follows:

    Authority:  42 U.S.C. 7401-7671q.

Subpart A--Applicability and General Provisions

0
237. Section 1065.10 is amended by revising paragraph (c)(1)(ii) to 
read as follows:


Sec.  1065.10  Other procedures.

* * * * *
    (c) * * *
    (1) * * *
    (ii) Whether the unrepresentative aspect of the procedures affects 
your ability to show compliance with the applicable emission standards.
* * * * *

0
238. Section 1065.15 is amended by revising paragraph (a)(2) to read as 
follows:


Sec.  1065.15  Overview of procedures for laboratory and field testing.

* * * * *
    (a) * * *
    (2) Hydrocarbon, HC, which may be expressed in the following ways:
    (i) Total hydrocarbon, THC.
    (ii) Nonmethane hydrocarbon, NMHC, which results from subtracting 
methane, CH4, from THC.
    (iii) Nonmethane-nonethane hydrocarbon, NMNEHC, which results from 
subtracting methane, CH4, and ethane, 
C2H6, from THC.
    (iv) Total hydrocarbon-equivalent, THCE, which results from 
adjusting THC mathematically to be equivalent on a carbon-mass basis.
    (v) Nonmethane hydrocarbon-equivalent, NMHCE, which results from 
adjusting NMHC mathematically to be equivalent on a carbon-mass basis.
* * * * *

Subpart B--Equipment Specifications

0
239. Section 1065.140 is amended by revising paragraphs (d)(2) 
introductory text and (d)(3) introductory text to read as follows:


Sec.  1065.140  Dilution for gaseous and PM constituents.

* * * * *
    (d) * * *
    (2) Constant dilution-ratio PFD. Do one of the following for 
constant dilution-ratio PFD:
* * * * *
    (3) Varying dilution-ratio PFD. All the following provisions apply 
for varying dilution-ratio PFD:
* * * * *

0
240. Section 1065.170 is amended by revising Figure 1 as follows:


Sec.  1065.170  Batch sampling for gaseous and PM constituents.

* * * * *
[GRAPHIC] [TIFF OMITTED] TR25OC16.158

Subpart C--Measurement Instruments

0
241. Section 1065.202 is amended by revising the introductory text to 
read as follows:


Sec.  1065.202  Data updating, recording, and control.

    Your test system must be able to update data, record data and 
control systems related to operator demand, the dynamometer, sampling 
equipment, and measurement instruments. Set up the measurement and 
recording equipment to avoid aliasing by ensuring that the sampling 
frequency is at least double that of the signal you are measuring, 
consistent with good engineering judgment; this may require increasing 
the sampling rate or filtering the signal. Use data acquisition and 
control systems that can record at the specified minimum frequencies, 
as follows:
* * * * *

0
242. Section 1065.220 is amended by revising paragraph (a) introductory 
text to read as follows:


Sec.  1065.220  Fuel flow meter.

    (a) Application. You may use fuel flow in combination with a 
chemical balance of fuel, inlet air, and raw exhaust to calculate raw 
exhaust flow as described in Sec.  1065.655(f), as follows:
* * * * *

[[Page 74163]]


0
243. Section 1065.225 is amended by revising paragraph (a) introductory 
text to read as follows:


Sec.  1065.225  Intake-air flow meter.

    (a) Application. You may use an intake-air flow meter in 
combination with a chemical balance of fuel, inlet air, and exhaust to 
calculate raw exhaust flow as described in Sec.  1065.655(f) and (g), 
as follows:
* * * * *

0
244. Add Sec.  1065.247 to read as follows:


Sec.  1065.247  Diesel exhaust fluid flow rate.

    (a) Application. Determine diesel exhaust fluid flow rate over a 
test interval for batch or continuous emission sampling using one of 
the three methods described in this section.
    (b) ECM. Use the ECM signal directly to determine diesel exhaust 
fluid flow rate. You may combine this with a gravimetric scale if that 
improves measurement quality. Prior to testing, you may characterize 
the ECM signal using a laboratory measurement and adjust the ECM 
signal, consistent with good engineering judgment.
    (c) Flow meter. Measure diesel exhaust fluid flow rate with a flow 
meter. We recommend that the flow meter that meets the specifications 
in Table 1 of Sec.  1065.205. Note that your overall system for 
measuring diesel exhaust fluid flow must meet the linearity 
verification in Sec.  1065.307. Measure using the following procedure:
    (1) Condition the flow of diesel exhaust fluid as needed to prevent 
wakes, eddies, circulating flows, or flow pulsations from affecting the 
accuracy or repeatability of the meter. You may accomplish this by 
using a sufficient length of straight tubing (such as a length equal to 
at least 10 pipe diameters) or by using specially designed tubing 
bends, straightening fins, or pneumatic pulsation dampeners to 
establish a steady and predictable velocity profile upstream of the 
meter. Condition the flow as needed to prevent any gas bubbles in the 
fluid from affecting the flow meter.
    (2) Account for any fluid that bypasses the engine or returns from 
the engine to the fluid storage tank.
    (d) Gravimetric scale. Use a gravimetric scale to determine the 
mass of diesel exhaust fluid the engine uses over a discrete-mode test 
interval and divide by the time of the test interval.

0
245. Section 1065.260 is amended by revising paragraphs (e) and (f) and 
adding paragraph (g) to read as follows:


Sec.  1065.260  Flame-ionization detector.

* * * * *
    (e) NMHC and NMOG. For demonstrating compliance with NMHC 
standards, you may either measure THC or determine NMHC mass as 
described in Sec.  1065.660(b)(1), or you may measure THC and 
CH4 and determine NMHC as described in Sec.  1065.660(b)(2) 
or (3). For gaseous-fueled engines, you may also use the additive 
method in Sec.  1065.660(b)(4). See 40 CFR 1066.635 for methods to 
demonstrate compliance with NMOG standards for vehicle testing.
    (f) NMNEHC. For demonstrating compliance with NMNEHC standards, you 
may either measure NMHC or determine NMNEHC mass as described in Sec.  
1065.660(c)(1), you may measure THC, CH4, and 
C2H6 and determine NMNEHC as described in Sec.  
1065.660(c)(2), or you may use the additive method in Sec.  
1065.660(c)(3).
    (g) CH4. For reporting CH4 or for demonstrating 
compliance with CH4 standards, you may use a FID analyzer 
with a nonmethane cutter as described in Sec.  1065.265 or you may use 
a GC-FID as described in Sec.  1065.267. Determine CH4 as 
described in Sec.  1065.660(d).

0
246. Add Sec.  1065.266 to subpart C to read as follows:


Sec.  1065.266  Fourier transform infrared analyzer.

    (a) Application. For engines that run only on natural gas, you may 
use a Fourier transform infrared (FTIR) analyzer to measure nonmethane 
hydrocarbon (NMHC) and nonmethane-nonethane hydrocarbon (NMNEHC) for 
continuous sampling. You may use an FTIR analyzer with any gaseous-
fueled engine, including dual-fuel engines, to measure CH4 
and C2H6, for either batch or continuous sampling 
(for subtraction from THC).
    (b) Component requirements. We recommend that you use an FTIR 
analyzer that meets the specifications in Table 1 of Sec.  1065.205. 
Note that your FTIR-based system must meet the linearity verification 
in Sec.  1065.307. Use appropriate analytical procedures for 
interpretation of infrared spectra. For example, EPA Test Method 320 
(see https://www3.epa.gov/ttn/emc/promgate/m-320.pdf) and ASTM D6348 
(incorporated by reference in Sec.  1065.1010) are considered valid 
methods for spectral interpretation. You must use heated FTIR analyzers 
that maintain all surfaces that are exposed to emissions at a 
temperature of (110 to 202) [deg]C.
    (c) Hydrocarbon species for NMHC and NMNEHC additive determination. 
To determine NMNEHC, measure ethene, ethyne, propane, propene, butane, 
formaldehyde, acetaldehyde, formic acid, and methanol. To determine 
NMHC, measure ethane in addition to those same hydrocarbon species. 
Determine NMHC and NMNEHC as described in Sec.  1065.660(b)(4) and 
Sec.  1065.660(c)(3).
    (d) NMHC and NMNEHC CH4 and C2H6 
determination from subtraction of CH4 and 
C2H6 from THC. Determine CH4 as 
described in Sec.  1065.660(d)(2) and C2H6 as 
described Sec.  1065.660(e). Determine NMHC from subtraction of 
CH4 from THC as described in Sec.  1065.660(b)(3) and NMNEHC 
from subtraction of CH4 and C2H6 as 
described Sec.  1065.660(c)(2). Determine CH4 as described 
in Sec.  1065.660(d)(2) and C2H6 as described 
Sec.  1065.660(e).
    (e) Interference verification. Perform interference verification 
for FTIR analyzers using the procedures of Sec.  1065.366. Certain 
interference gases can interfere with FTIR analyzers by causing a 
response similar to the hydrocarbon species of interest. When running 
the interference verification for these analyzers, use interference 
gases as follows:
    (1) The interference gases for CH4 are CO2, 
H2O, and C2H6.
    (2) The interference gases for C2H6 are 
CO2, H2O, and CH4.
    (3) The interference gases for other measured hydrocarbon species 
are CO2, H2O, CH4, and 
C2H6.

0
247. Section 1065.267 is amended by revising paragraph (a) to read as 
follows:


Sec.  1065.267  Gas chromatograph with a flame ionization detector.

    (a) Application. You may use a gas chromatograph with a flame 
ionization detector (GC-FID) to measure CH4 and 
C2H6 concentrations of diluted exhaust for batch 
sampling. While you may also use a nonmethane cutter to measure 
CH4, as described in Sec.  1065.265, use a reference 
procedure based on a gas chromatograph for comparison with any proposed 
alternate measurement procedure under Sec.  1065.10.
* * * * *

0
248. Section 1065.275 is amended by revising paragraph (b)(2) to read 
as follows:


Sec.  1065.275  N2O measurement devices.

* * * * *
    (b) * * *
    (2) Fourier transform infrared (FTIR) analyzer. Use appropriate 
analytical procedures for interpretation of infrared spectra. For 
example, EPA Test Method 320 (see https://www3.epa.gov/ttn/emc/promgate/m-320.pdf) and ASTM D6348 (incorporated by reference in Sec.  
1065.1010) are considered valid methods for spectral interpretation.
* * * * *

[[Page 74164]]

Subpart D--Calibrations and Verifications

0
249. Section 1065.303 is revised to read as follows:


Sec.  1065.303  Summary of required calibration and verifications.

    The following table summarizes the required and recommended 
calibrations and verifications described in this subpart and indicates 
when these have to be performed:

     Table 1 of Sec.   1065.303--Summary of Required Calibration and
                              Verifications
------------------------------------------------------------------------
 Type of calibration or verification         Minimum frequency \1\
------------------------------------------------------------------------
Sec.   1065.305: Accuracy,             Accuracy: Not required, but
 repeatability and noise.               recommended for initial
                                        installation.
                                       Repeatability: Not required, but
                                        recommended for initial
                                        installation.
                                       Noise: Not required, but
                                        recommended for initial
                                        installation.
Sec.   1065.307: Linearity             Speed: Upon initial installation,
 verification.                          within 370 days before testing
                                        and after major maintenance.
                                       Torque: Upon initial
                                        installation, within 370 days
                                        before testing and after major
                                        maintenance.
                                       Electrical power, current, and
                                        voltage: Upon initial
                                        installation, within 370 days
                                        before testing and after major
                                        maintenance.\2\
                                       Fuel flow rate: Upon initial
                                        installation, within 370 days
                                        before testing, and after major
                                        maintenance.
                                       DEF flow: Upon initial
                                        installation, within 370 days
                                        before testing, and after major
                                        maintenance.
                                       Intake-air, dilution air, diluted
                                        exhaust, and batch sampler flow
                                        rates: Upon initial
                                        installation, within 370 days
                                        before testing and after major
                                        maintenance, unless flow is
                                        verified by propane check or by
                                        carbon or oxygen balance.
                                       Raw exhaust flow rate: Upon
                                        initial installation, within 185
                                        days before testing and after
                                        major maintenance, unless flow
                                        is verified by propane check or
                                        by carbon or oxygen balance.
                                       Gas dividers: Upon initial
                                        installation, within 370 days
                                        before testing, and after major
                                        maintenance.
                                       Gas analyzers (unless otherwise
                                        noted): Upon initial
                                        installation, within 35 days
                                        before testing and after major
                                        maintenance.
                                       FTIR and photoacoustic analyzers:
                                        Upon initial installation,
                                        within 370 days before testing
                                        and after major maintenance.
                                       GC-ECD: Upon initial installation
                                        and after major maintenance.
                                       PM balance: Upon initial
                                        installation, within 370 days
                                        before testing and after major
                                        maintenance.
                                       Pressure, temperature, and
                                        dewpoint: Upon initial
                                        installation, within 370 days
                                        before testing and after major
                                        maintenance.
Sec.   1065.308: Continuous gas        Upon initial installation or
 analyzer system response and           after system modification that
 updating-recording verification--for   would affect response.
 gas analyzers not continuously
 compensated for other gas species.
Sec.   1065.309: Continuous gas        Upon initial installation or
 analyzer system-response and           after system modification that
 updating-recording verification--for   would affect response.
 gas analyzers continuously
 compensated for other gas species.
Sec.   1065.310: Torque..............  Upon initial installation and
                                        after major maintenance.
Sec.   1065.315: Pressure,             Upon initial installation and
 temperature, dewpoint.                 after major maintenance.
Sec.   1065.320: Fuel flow...........  Upon initial installation and
                                        after major maintenance.
Sec.   1065.325: Intake flow.........  Upon initial installation and
                                        after major maintenance.
Sec.   1065.330: Exhaust flow........  Upon initial installation and
                                        after major maintenance.
Sec.   1065.340: Diluted exhaust flow  Upon initial installation and
 (CVS).                                 after major maintenance.
Sec.   1065.341: CVS and batch         Upon initial installation, within
 sampler verification \3\.              35 days before testing, and
                                        after major maintenance.
Sec.   1065.342 Sample dryer           For thermal chillers: Upon
 verification.                          installation and after major
                                        maintenance.
                                       For osmotic membranes; Upon
                                        installation, within 35 days of
                                        testing, and after major
                                        maintenance.
Sec.   1065.345: Vacuum leak.........  For laboratory testing: Upon
                                        initial installation of the
                                        sampling system, within 8 hours
                                        before the start of the first
                                        test interval of each duty-cycle
                                        sequence, and after maintenance
                                        such as pre-filter changes.
                                       For field testing: After each
                                        installation of the sampling
                                        system on the vehicle, prior to
                                        the start of the field test, and
                                        after maintenance such as pre-
                                        filter changes.
Sec.   1065.350: CO2 NDIR H2O          Upon initial installation and
 interference.                          after major maintenance.
Sec.   1065.355: CO NDIR CO2 and H2O   Upon initial installation and
 interference.                          after major maintenance.
Sec.   1065.360: FID calibration THC   Calibrate all FID analyzers: Upon
 FID optimization, and THC FID          initial installation and after
 verification.                          major maintenance.
                                       Optimize and determine CH4
                                        response for THC FID analyzers:
                                        Upon initial installation and
                                        after major maintenance.
                                       Verify CH4 response for THC FID
                                        analyzers: Upon initial
                                        installation, within 185 days
                                        before testing, and after major
                                        maintenance.
                                       Verify C2H6 response for THC FID
                                        analyzers if used for NMNEHC
                                        determination: Upon initial
                                        installation, within 185 days
                                        before testing, and after major
                                        maintenance.
Sec.   1065.362: Raw exhaust FID O2    For all FID analyzers: Upon
 interference.                          initial installation, and after
                                        major maintenance.
                                       For THC FID analyzers: Upon
                                        initial installation, after
                                        major maintenance, and after FID
                                        optimization according to Sec.
                                        1065.360.

[[Page 74165]]

 
Sec.   1065.365: Nonmethane cutter     Upon initial installation, within
 penetration.                           185 days before testing, and
                                        after major maintenance.
Sec.   1065.366: Interference          Upon initial installation and
 verification for FTIR analyzers.       after major maintenance.
Sec.   1065.369: H2O, CO, and CO2      Upon initial installation and
 interference verification for          after major maintenance.
 ethanol photoacoustic analyzers.
Sec.   1065.370: CLD CO2 and H2O       Upon initial installation and
 quench.                                after major maintenance.
Sec.   1065.372: NDUV HC and H2O       Upon initial installation and
 interference.                          after major maintenance.
Sec.   1065.375: N2O analyzer          Upon initial installation and
 interference.                          after major maintenance.
Sec.   1065.376: Chiller NO2           Upon initial installation and
 penetration.                           after major maintenance.
Sec.   1065.378: NO2-to-NO converter   Upon initial installation, within
 conversion.                            35 days before testing, and
                                        after major maintenance.
Sec.   1065.390: PM balance and        Independent verification: Upon
 weighing.                              initial installation, within 370
                                        days before testing, and after
                                        major maintenance.
                                       Zero, span, and reference sample
                                        verifications: Within 12 hours
                                        of weighing, and after major
                                        maintenance.
Sec.   1065.395: Inertial PM balance   Independent verification: Upon
 and weighing.                          initial installation, within 370
                                        days before testing, and after
                                        major maintenance.
                                       Other verifications: Upon initial
                                        installation and after major
                                        maintenance.
------------------------------------------------------------------------
\1\ Perform calibrations and verifications more frequently than we
  specify, according to measurement system manufacturer instructions and
  good engineering judgment.
\2\ Perform linearity verification either for electrical power or for
  current and voltage.
\3\ The CVS verification described in Sec.   1065.341 is not required
  for systems that agree within 2% based on a chemical
  balance of carbon or oxygen of the intake air, fuel, and diluted
  exhaust.


0
250. Section 1065.340 is amended by revising paragraphs (e), (f)(8), 
(f)(13), (g), (h), and Figure 1 to read as follows:


Sec.  1065.340  Diluted exhaust flow (CVS) calibration.

* * * * *
    (e) Configuration. Calibrate the system with any upstream screens 
or other restrictions that will be used during testing and that could 
affect the flow ahead of the CVS flow meter, using good engineering 
judgment to minimize the effect on the flow distribution. You may not 
use any upstream screen or other restriction that could affect the flow 
ahead of the reference flow meter, unless the flow meter has been 
calibrated with such a restriction. In the case of a free standing SSV 
reference flow meter, you may not have any upstream screens.
    (f) * * *
    (8) Repeat the steps in paragraphs (e)(6) and (7) of this section 
to record data at a minimum of six restrictor positions ranging from 
the wide open restrictor position to the minimum expected pressure at 
the PDP inlet or the maximum expected differential (outlet minus inlet) 
pressure across the PDP during testing.
* * * * *
    (13) During emission testing ensure that the PDP is not operated 
either below the lowest inlet pressure point or above the highest 
differential pressure point in the calibration data.
    (g) SSV calibration. Calibrate a subsonic venturi (SSV) to 
determine its calibration coefficient, Cd, for the expected 
range of inlet pressures. Calibrate an SSV flow meter as follows:
    (1) Connect the system as shown in Figure 1 of this section.
    (2) Verify that any leaks between the calibration flow meter and 
the SSV are less than 0.3% of the total flow at the highest 
restriction.
    (3) Start the blower downstream of the SSV.
    (4) While the SSV operates, maintain a constant temperature at the 
SSV inlet within 2% of the mean absolute inlet temperature,
    Tin.
    (5) Set the variable restrictor or variable-speed blower to a flow 
rate greater than the greatest flow rate expected during testing. You 
may not extrapolate flow rates beyond calibrated values, so we 
recommend that you make sure the Reynolds number, Re#, at 
the SSV throat at the greatest calibrated flow rate is greater than the 
maximum Re# expected during testing.
    (6) Operate the SSV for at least 3 min to stabilize the system. 
Continue operating the SSV and record the mean of at least 30 seconds 
of sampled data of each of the following quantities:
    (i) The mean flow rate of the reference flow meter 
niref. This may include several measurements of different 
quantities for calculating niref, such as reference meter 
pressures and temperatures.
    (ii) Optionally, the mean dewpoint of the calibration 
air,Tdew. See Sec.  1065.640 for permissible assumptions.
    (iii) The mean temperature at the venturi inlet,Tin.
    (iv) The mean static absolute pressure at the venturi inlet, 
Pin.
    (v) The mean static differential pressure between the static 
pressure at the venturi inlet and the static pressure at the venturi 
throat, [Delta]PSSV.
    (7) Incrementally close the restrictor valve or decrease the blower 
speed to decrease the flow rate.
    (8) Repeat the steps in paragraphs (g)(6) and (7) of this section 
to record data at a minimum of ten flow rates.
    (9) Determine an equation to quantify Cd as a function 
of Re# by using the collected data and the equations in 
Sec.  1065.640. Section 1065.640 also includes statistical criteria for 
validating the Cd versus Re# equation.
    (10) Verify the calibration by performing a CVS verification (i.e., 
propane check) as described in Sec.  1065.341 using the new 
Cd versus Re# equation.
    (11) Use the SSV only between the minimum and maximum calibrated 
Re#. If you want to use the SSV at a lower or higher 
Re#, you must recalibrate the SSV.
    (12) Use the equations in Sec.  1065.642 to determine SSV flow 
during a test.
    (h) CFV calibration. Calibrate a critical-flow venturi (CFV) to 
verify its discharge coefficient, Cd, up to the highest 
expected pressure ratio, r, according to Sec.  1065.640. Calibrate a 
CFV flow meter as follows:
    (1) Connect the system as shown in Figure 1 of this section.
    (2) Verify that any leaks between the calibration flow meter and 
the CFV are less than 0.3% of the total flow at the highest 
restriction.
    (3) Start the blower downstream of the CFV.
    (4) While the CFV operates, maintain a constant temperature at the 
CFV inlet

[[Page 74166]]

within 2% of the mean absolute inlet temperature, 
Tin.
    (5) Set the variable restrictor to its wide-open position. Instead 
of a variable restrictor, you may alternately vary the pressure 
downstream of the CFV by varying blower speed or by introducing a 
controlled leak. Note that some blowers have limitations on nonloaded 
conditions.
    (6) Operate the CFV for at least 3 min to stabilize the system. 
Continue operating the CFV and record the mean values of at least 30 
seconds of sampled data of each of the following quantities:
    (i) The mean flow rate of the reference flow meter, 
niref. This may include several measurements of different 
quantities, such as reference meter pressures and temperatures, for 
calculating niref.
    (ii) The mean dewpoint of the calibration air,Tdew. See 
Sec.  1065.640 for permissible assumptions during emission 
measurements.
    (iii) The mean temperature at the venturi inlet,Tin.
    (iv) The mean static absolute pressure at the venturi inlet, 
Pin.
    (v) The mean static differential pressure between the CFV inlet and 
the CFV outlet, [Delta]PCFV.
    (7) Incrementally close the restrictor valve or decrease the 
downstream pressure to decrease the differential pressure across the 
CFV, [Delta]pCFV.
    (8) Repeat the steps in paragraphs (f)(6) and (7) of this section 
to record mean data at a minimum of ten restrictor positions, such that 
you test the fullest practical range of [Delta]PCFV expected 
during testing. We do not require that you remove calibration 
components or CVS components to calibrate at the lowest possible 
restrictions.
    (9) Determine Cd and the highest allowable pressure 
ratio, r, according to Sec.  1065.640.
    (10) Use Cd to determine CFV flow during an emission 
test. Do not use the CFV above the highest allowed r, as determined in 
Sec.  1065.640.
    (11) Verify the calibration by performing a CVS verification (i.e., 
propane check) as described in Sec.  1065.341.
    (12) If your CVS is configured to operate more than one CFV at a 
time in parallel, calibrate your CVS by one of the following:
    (i) Calibrate every combination of CFVs according to this section 
and Sec.  1065.640. Refer to Sec.  1065.642 for instructions on 
calculating flow rates for this option.
    (ii) Calibrate each CFV according to this section and Sec.  
1065.640. Refer to Sec.  1065.642 for instructions on calculating flow 
rates for this option.
* * * * *

[[Page 74167]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.159

BILLING CODE 6550-50-C

0
251. Section 1065.341 is amended by revising paragraph (c)(3) to read 
as follows:


Sec.  1065.341  CVS, PFD, and batch sampler verification (propane 
check).

* * * * *
    (c) * * *
    (3) Select a C3H8 injection port in the CVS. 
Select the port location to be as close as practical to the location 
where you introduce engine exhaust into the CVS, or at some point in 
the laboratory exhaust tubing upstream of this location. Connect the 
C3H8 cylinder to the injection system.
* * * * *

0
252. Section 1065.345 is amended by revising paragraphs (d)(2), (d)(4), 
(e)(3), and (e)(4) to read as follows:


Sec.  1065.345  Vacuum-side leak verification.

* * * * *
    (d) * * *
    (2) Supply span gas to the analyzer span port and record the 
measured value.
* * * * *
    (4) Verify that the measured overflow span gas concentration is 
within 0.5% of the concentration measured in paragraph 
(d)(2) of this section. A measured value lower than expected indicates 
a leak, but a value higher than expected may indicate a problem with 
the span gas or the analyzer itself. A measured value higher than 
expected does not indicate a leak.

[[Page 74168]]

    (e) * * *
    (3) Turn off the sample pumps and seal the system. Measure and 
record the absolute pressure of the trapped gas and optionally the 
system absolute temperature. Wait long enough for any transients to 
settle and long enough for a leak at 0.5% to have caused a pressure 
change of at least 10 times the resolution of the pressure transducer, 
then again record the pressure and optionally temperature.
    (4) Calculate the leak flow rate based on an assumed value of zero 
for pumped-down bag volumes and based on known values for the sample 
system volume, the initial and final pressures, optional temperatures, 
and elapsed time. Using the calculations specified in Sec.  1065.644, 
verify that the vacuum-decay leak flow rate is less than 0.5% of the 
system's normal in-use flow rate.

0
253. Section 1065.360 is amended by revising paragraphs (a)(3), (d) 
introductory text, and (d)(7) and adding paragraph (f) to read as 
follows:


Sec.  1065.360  FID optimization and verification.

    (a) * * *
    (3) If you determine NMNEHC by subtracting from measured THC, 
determine the ethane (C2H6) response factor after 
initial analyzer installation and after major maintenance as described 
in paragraph (f) of this section. Verify the C2H6 
response within 185 days before testing as described in paragraph (f) 
of this section.
* * * * *
    (d) THC FID CH4 response factor determination. This procedure is 
only for FID analyzers that measure THC. Since FID analyzers generally 
have a different response to CH4 versus 
C3H8, determine the THC-FID analyzer's 
CH4 response factor, RFCH4[THC-FID], after FID 
optimization. Use the most recent RFCH4[THC-FID] measured 
according to this section in the calculations for HC determination 
described in Sec.  1065.660 to compensate for CH4 response. 
Determine RFCH4[THC-FID] as follows, noting that you do not 
determine RFCH4[THC-FID] for FIDs that are calibrated and 
spanned using CH4 with a nonmethane cutter:
* * * * *
    (7) Introduce the CH4 span gas that you selected under 
paragraph (d)(2) of this section into the FID analyzer.
* * * * *
    (f) THC FID C2H6 response factor 
determination. This procedure is only for FID analyzers that measure 
THC. Since FID analyzers generally have a different response to 
C2H6 than C3H8, determine 
the THC-FID analyzer's C2H6 response factor, 
RFC2H6[THC-FID], after FID optimization using the procedure 
described in paragraph (d) of this section, replacing CH4 
with C2H6. Use the most recent 
RFC2H6[THC-FID] measured according to this section in the 
calculations for HC determination described in Sec.  1065.660 to 
compensate for C2H6 response.

0
254. Section 1065.365 is amended by revising paragraphs (d)(9), 
(e)(10), (f)(9), and (f)(14) to read as follows:


Sec.  1065.365  Nonmethane cutter penetration fractions.

* * * * *
    (d) * * *
    (9) Divide the mean C2H6 concentration by the 
reference concentration of C2H6, converted to a 
C1 basis. The result is the C2H6 
combined response factor and penetration fraction, 
RFPFC2H6[NMC-FID]. Use this combined response factor and 
penetration fraction and the product of the CH4 response 
factor and CH4 penetration fraction, 
RFPFCH4[NMC-FID], set to 1.0 in emission calculations 
according to Sec.  1065.660(b)(2)(i), Sec.  1065.660(d)(1)(i), or Sec.  
1065.665, as applicable.
    (e) * * *
    (10) Divide the mean C2H6 concentration 
measured through the nonmethane cutter by the mean 
C2H6 concentration measured after bypassing the 
nonmethane cutter. The result is the C2H6 
penetration fraction, PFC2H6[NMC-FID]. Use this penetration 
fraction according to Sec.  1065.660(b)(2)(ii), Sec.  
1065.660(d)(1)(ii), or Sec.  1065.665, as applicable.
* * * * *
    (f) * * *
    (9) Divide the mean C2H6 concentration by the 
reference concentration of C2H6, converted to a 
C1 basis. The result is the C2H6 
combined response factor and penetration fraction, 
RFPFC2H6[NMC-FID]. Use this combined response factor and 
penetration fraction according to Sec.  1065.660(b)(2)(iii), Sec.  
1065.660(d)(1)(iii), or Sec.  1065.665, as applicable.
* * * * *
    (14) Divide the mean CH4 concentration measured through 
the nonmethane cutter by the mean CH4 concentration measured 
after bypassing the nonmethane cutter. The result is the CH4 
penetration fraction, PFCH4[NMC-FID]. Use this penetration 
fraction according to Sec.  1065.660(b)(2)(iii), Sec.  
1065.660(d)(1)(iii), or Sec.  1065.665, as applicable.

0
255. Section 1065.366 is added to subpart D to read as follows:


Sec.  1065.366  Interference verification for FTIR analyzers.

    (a) Scope and frequency. If you measure CH4, 
C2H6, NMHC, or NMNEHC using an FTIR analyzer, 
verify the amount of interference after initial analyzer installation 
and after major maintenance.
    (b) Measurement principles. Interference gases can interfere with 
certain analyzers by causing a response similar to the target analyte. 
If the analyzer uses compensation algorithms that utilize measurements 
of other gases to meet this interference verification, simultaneously 
conduct these other measurements to test the compensation algorithms 
during the analyzer interference verification.
    (c) System requirements. An FTIR analyzer must have combined 
interference that is within 2% of the flow-weighted mean 
concentration of CH4, NMHC, or NMNEHC expected at the 
standard, though we strongly recommend a lower interference that is 
within 1%.
    (d) Procedure. Perform the interference verification for an FTIR 
analyzer using the same procedure that applies for N2O 
analyzers in Sec.  1065.375(d).

0
256. Section 1065.370 is amended by revising paragraph (d)(11) to read 
as follows:


Sec.  1065.370  CLD CO2 and H2O quench 
verification.

* * * * *
    (d) * * *
    (11) Calculate the actual NO concentration at the gas divider's 
outlet, xNOact, based on the span gas concentrations and 
xCO2act according to Eq. 1065.675-2. Use the calculated 
value in the quench verification calculations in Eq. 1065.675-1.
* * * * *

0
257. Section 1065.375 is amended by revising paragraph (b) to read as 
follows:


Sec.  1065.375  Interference verification for N2O analyzers.

* * * * *
    (b) Measurement principles. Interference gases can positively 
interfere with certain analyzers by causing a response similar to 
N2O. If the analyzer uses compensation algorithms that 
utilize measurements of other gases to meet this interference 
verification, simultaneously conduct these other measurements to test 
the compensation algorithms during the analyzer interference 
verification.
* * * * *

0
258. Section 1065.390 is amended by revising paragraphs (b), (c) 
introductory text, and (c)(2) to read as follows:

[[Page 74169]]

Sec.  1065.390  PM balance verifications and weighing process 
verification.

* * * * *
    (b) Independent verification. Have the balance manufacturer (or a 
representative approved by the balance manufacturer) verify the balance 
performance within 370 days of testing. Balances have internal weights 
that compensate for drift due to environmental changes. These internal 
weights must be verified as part of this independent verification with 
external, certified calibration weights that meet the specifications in 
Sec.  1065.790.
    (c) Zeroing and spanning. You must verify balance performance by 
zeroing and spanning it with at least one calibration weight. Also, any 
external weights you use must meet the specifications in Sec.  
1065.790. Any weights internal to the PM balance used for this 
verification must be verified as described in paragraph (b) of this 
section.
* * * * *
    (2) You may use an automated procedure to verify balance 
performance. For example most balances have internal weights for 
automatically verifying balance performance.
* * * * *

Subpart F--Performing an Emission Test in the Laboratory

0
259. Section 1065.510 is amended by revising paragraphs (c) 
introductory text, (c)(4), and (d)(5)(i) and (iii) to read as follows:


Sec.  1065.510  Engine mapping.

* * * * *
    (c) Negative torque mapping. If your engine is subject to a 
reference duty cycle that specifies negative torque values (i.e., 
engine motoring), generate a motoring torque curve by any of the 
following procedures:
* * * * *
    (4) For engines with an electric hybrid system, map the negative 
torque required to motor the engine and absorb any power delivered from 
the RESS by repeating paragraph (g)(2) of this section with minimum 
operator demand, stopping the sweep to discharge the RESS when the 
absolute instantaneous power measured from the RESS drops below the 
expected maximum absolute power from the RESS by more than 2% of total 
system maximum power (including engine motoring and RESS power) as 
determined from mapping the negative torque.
    (d) * * *
    (5) * * *
    (i) For constant-speed engines subject only to steady-state 
testing, you may perform an engine map by using a series of discrete 
torques. Select at least five evenly spaced torque setpoints from no-
load to 80% of the manufacturer-declared test torque or to a torque 
derived from your published maximum power level if the declared test 
torque is unavailable. Starting at the 80% torque point, select 
setpoints in 2.5% or smaller intervals, stopping at the endpoint 
torque. The endpoint torque is defined as the first discrete mapped 
torque value greater than the torque at maximum observed power where 
the engine outputs 90% of the maximum observed power; or the torque 
when engine stall has been determined using good engineering judgment 
(i.e. sudden deceleration of engine speed while adding torque). You may 
continue mapping at higher torque setpoints. At each setpoint, allow 
torque and speed to stabilize. Record the mean feedback speed and 
torque at each setpoint. From this series of mean feedback speed and 
torque values, use linear interpolation to determine intermediate 
values. Use this series of mean feedback speeds and torques to generate 
the power map as described in paragraph (e) of this section.
* * * * *
    (iii) For any isochronous governed (0% speed droop) constant-speed 
engine, you may map the engine with two points as described in this 
paragraph (d)(5)(iii). After stabilizing at the no-load governed speed 
in paragraph (d)(4) of this section, record the mean feedback speed and 
torque. Continue to operate the engine with the governor or simulated 
governor controlling engine speed using operator demand, and control 
the dynamometer to target a speed of 99.5% of the recorded mean no-load 
governed speed. Allow speed and torque to stabilize. Record the mean 
feedback speed and torque. Record the target speed. The absolute value 
of the speed error (the mean feedback speed minus the target speed) 
must be no greater than 0.1% of the recorded mean no-load governed 
speed. From this series of two mean feedback speed and torque values, 
use linear interpolation to determine intermediate values. Use this 
series of two mean feedback speeds and torques to generate a power map 
as described in paragraph (e) of this section. Note that the measured 
maximum test torque as determined in Sec.  1065.610 (b)(1) will be the 
mean feedback torque recorded on the second point.
* * * * *

0
260. Section 1065.546 is amended by revising paragraph (a) to read as 
follows:


Sec.  1065.546  Verification of minimum dilution ratio for PM batch 
sampling.

* * * * *
    (a) Determine minimum dilution ratio based on molar flow data. This 
involves determination of at least two of the following three 
quantities: raw exhaust flow (or previously diluted flow), dilution air 
flow, and dilute exhaust flow. You may determine the raw exhaust flow 
rate based on the measured intake air or fuel flow rate and the raw 
exhaust chemical balance terms as given in Sec.  1065.655(f). You may 
determine the raw exhaust flow rate based on the measured intake air 
and dilute exhaust molar flow rates and the dilute exhaust chemical 
balance terms as given in Sec.  1065.655(g). You may alternatively 
estimate the molar raw exhaust flow rate based on intake air, fuel rate 
measurements, and fuel properties, consistent with good engineering 
judgment.
* * * * *

0
261. Section 1065.590 is amended by revising paragraphs (f)(2), (j) 
introductory text, and (j)(3) through (7) to read as follows:


Sec.  1065.590  PM sampling media (e.g., filters) preconditioning and 
tare weighing.

* * * * *
    (f) * * *
    (2) Use good engineering judgment to determine if substitution 
weighing is necessary to show that an engine meets the applicable 
standard. You may follow the substitution weighing procedure in 
paragraph (j) of this section, or you may develop your own procedure.
* * * * *
    (j) Substitution weighing involves measurement of a reference 
weight before and after each weighing of the PM sampling medium (e.g., 
the filter). While substitution weighing requires more measurements, it 
corrects for a balance's zero-drift and it relies on balance linearity 
only over a small range. This is most advantageous when quantifying net 
PM masses that are less than 0.1% of the sample medium's mass. However, 
it may not be advantageous when net PM masses exceed 1% of the sample 
medium's mass. If you utilize substitution weighing, it must be used 
for both pre-test and post-test weighing. The same substitution weight 
must be used for both pre-test and post-test weighing. Correct the mass 
of the substitution weight for buoyancy if the density of the 
substitution weight is less than 2.0 g/

[[Page 74170]]

cm\3\. The following steps are an example of substitution weighing:
* * * * *
    (3) Select and weigh a substitution weight that meets the 
requirements for calibration weights found in Sec.  1065.790. The 
substitution weight must also have the same density as the weight you 
use to span the microbalance, and be similar in mass to an unused 
sample medium (e.g., filter). A 47 mm PTFE membrane filter will 
typically have a mass in the range of 80 to 100 mg.
    (4) Record the stable balance reading, then remove the substitution 
weight.
    (5) Weigh an unused sample medium (e.g., a new filter), record the 
stable balance reading and record the balance environment's dewpoint, 
ambient temperature, and atmospheric pressure.
    (6) Reweigh the substitution weight and record the stable balance 
reading.
    (7) Calculate the arithmetic mean of the two substitution-weight 
readings that you recorded immediately before and after weighing the 
unused sample. Subtract that mean value from the unused sample reading, 
then add the true mass of the substitution weight as stated on the 
substitution-weight certificate. Record this result. This is the unused 
sample's tare weight without correcting for buoyancy.
* * * * *

Subpart G--Calculations and Data Requirements

0
262. Section 1065.602 is amended by revising paragraphs (f)(1) 
introductory text, (f)(2) introductory text, and (j) to read as 
follows:


Sec.  1065.602  Statistics.

* * * * *
    (f) * * *
    (1) For an unpaired t-test, calculate the t statistic and its 
number of degrees of freedom, v, as follows:
* * * * *
    (2) For a paired t-test, calculate the t statistic and its number 
of degrees of freedom, v, as follows, noting that the [egr]i 
are the errors (e.g., differences) between each pair of 
yrefi and yi:
* * * * *
    (j) Standard estimate of error. Calculate a standard estimate of 
error, SEE, as follows:

[GRAPHIC] [TIFF OMITTED] TR25OC16.308

Eq. 1065.602-11
    Example: 
N = 6000
y1 = 2045.8
a0y = -16.8083
a1y = 1.0110
yref1 = 2045.0
[GRAPHIC] [TIFF OMITTED] TR25OC16.313

SEEy = 5.348
* * * * *

0
263. Section 1065.610 is amended by revising paragraphs (a)(1)(ii), 
(a)(1)(iii), (a)(1)(vi), (a)(2), (b), and (c)(1) and (2) to read as 
follows:


Sec.  1065.610  Duty-cycle generation.

* * * * *
    (a) * * *
    (1) * * *
    (ii) Determine the lowest and highest engine speeds corresponding 
to 98% of Pmax, using linear interpolation, and no 
extrapolation, as appropriate.
    (iii) Determine the engine speed corresponding to maximum power, 
fnPmax, by calculating the average of the two speed values 
from paragraph (a)(1)(ii) of this section. If there is only one speed 
where power is equal to 98% of Pmax, take fnPmax 
as the speed at which Pmax occurs.
* * * * *
    (vi) Determine the lowest and highest engine speeds corresponding 
to the value calculated in paragraph (a)(1)(v) of this section, using 
linear interpolation as appropriate. Calculate fntest as the 
average of these two speed values. If there is only one speed 
corresponding to the value calculated in paragraph (a)(1)(v) of this 
section, take fntest as the speed where the maximum of the 
sum of the squares occurs.
* * * * *
    (2) For engines with a high-speed governor that will be subject to 
a reference duty cycle that specifies normalized speeds greater than 
100%, calculate an alternate maximum test speed, fntest,alt, 
as specified in this paragraph (a)(2). If fntest,alt is less 
than the measured maximum test speed, fntest, determined in 
paragraph (a)(1) of this section, replace fntest with 
fntest,alt. In this case, fntest,alt becomes the 
``maximum test speed'' for that engine. Note that Sec.  1065.510 allows 
you to apply an optional declared maximum test speed to the final 
measured maximum test speed determined as an outcome of the comparison 
between fntest, and fntest,alt in this paragraph 
(a)(2). Determine fntest,alt as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.160


[[Page 74171]]


Where:

fntest,alt = alternate maximum test speed
fnhi,idle = warm high-idle speed
fnidle = warm idle speed
% speedmax = maximum normalized speed from duty cycle
    Example: 
fnhi,idle = 2200 r/min
fnidle = 800 r/min
[GRAPHIC] [TIFF OMITTED] TR25OC16.161

fntest,alt = 2133 r/min
* * * * *
    (b) Maximum test torque, Ttest. For constant-speed engines, 
determine the measured Ttest from the torque and power-
versus-speed maps, generated according to Sec.  1065.510, as follows:
    (1) For constant speed engines mapped using the methods in Sec.  
1065.510(d)(5)(i) or (ii), determine Ttest as follows:
    (i) Determine maximum power, Pmax, from the engine map 
generated according to Sec.  1065.510 and calculate the value for power 
equal to 98% of Pmax.
    (ii) Determine the lowest and highest engine speeds corresponding 
to 98% of Pmax, using linear interpolation, and no 
extrapolation, as appropriate.
    (iii) Determine the engine speed corresponding to maximum power, 
fnPmax, by calculating the average of the two speed values 
from paragraph (a)(1)(ii) of this section. If there is only one speed 
where power is equal to 98% of Pmax, take fnPmax 
as the speed at which Pmax occurs.
    (iv) Transform the map into a normalized power-versus-speed map by 
dividing power terms by Pmax and dividing speed terms by 
fnPmax. Use Eq. 1065.610-1 to calculate a quantity 
representing the sum of squares from the normalized map.
    (v) Determine the maximum value for the sum of the squares from the 
map and multiply that value by 0.98.
    (vi) Determine the lowest and highest engine speeds corresponding 
to the value calculated in paragraph (a)(1)(v) of this section, using 
linear interpolation as appropriate. Calculate fntest as the 
average of these two speed values. If there is only one speed 
corresponding to the value calculated in paragraph (a)(1)(v) of this 
section, take fntest as the speed where the maximum of the 
sum of the squares occurs.
    (vii) The measured Ttest is the mapped torque at 
fntest.
    (2) For constant-speed engines using the two-point mapping method 
in Sec.  1065.510(d)(5)(iii), you may follow paragraph (a)(1) of this 
section to determine the measured Ttest, or you may use the 
measured torque of the second point as the measured Ttest 
directly.
    (3) Transform normalized torques to reference torques according to 
paragraph (d) of this section by using the measured maximum test torque 
determined according to paragraph (b)(1) of this section--or use your 
declared maximum test torque, as allowed in Sec.  1065.510.
    (c) * * *
    (1) % speed. If your normalized duty cycle specifies % speed 
values, use your warm idle speed and your maximum test speed to 
transform the duty cycle, as follows:


[GRAPHIC] [TIFF OMITTED] TR25OC16.162

    Example: 
% speed = 85% = 0.85
fntest = 2364 r/min
fnidle = 650 r/min
fnref = 0.85  (2364-650) + 650
fnref = 2107 r/min

    (2) A, B, and C speeds. If your normalized duty cycle specifies 
speeds as A, B, or C values, use your power-versus-speed curve to 
determine the lowest speed below maximum power at which 50% of maximum 
power occurs. Denote this value as nlo. Take nlo 
to be warm idle speed if all power points at speeds below the maximum 
power speed are higher than 50% of maximum power. Also determine the 
highest speed above maximum power at which 70% of maximum power occurs. 
Denote this value as nhi. If all power points at speeds 
above the maximum power speed are higher than 70% of maximum power, 
take nhi to be the declared maximum safe engine speed or the 
declared maximum representative engine speed, whichever is lower. Use 
nhi and nlo to calculate reference values for A, 
B, or C speeds as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.163

[GRAPHIC] [TIFF OMITTED] TR25OC16.164


[[Page 74172]]


[GRAPHIC] [TIFF OMITTED] TR25OC16.165

    Example: 
nlo = 1005 r/min
nhi = 2385 r/min
fnrefA = 0.25  (2385-1005) + 1005
fnrefB = 0.50  (2385-1005) + 1005
fnrefC = 0.75  (2385-1005) + 1005
fnrefA = 1350 r/min
fnrefB = 1695 r/min
fnrefC = 2040 r/min
* * * * *

0
264. Section 1065.640 is amended by revising paragraphs (a), (b), (c), 
(d), and (e)(3) to read as follows:


Sec.  1065.640  Flow meter calibration calculations.

* * * * *
    (a) Reference meter conversions. The calibration equations in this 
section use molar flow rate, nref, as a reference quantity. 
If your reference meter outputs a flow rate in a different quantity, 
such as standard volume rate, vstdref, actual volume rate, 
vactref, or mass rate, mref, convert your 
reference meter output to a molar flow rate using the following 
equations, noting that while values for volume rate, mass rate, 
pressure, temperature, and molar mass may change during an emission 
test, you should ensure that they are as constant as practical for each 
individual set point during a flow meter calibration:
[GRAPHIC] [TIFF OMITTED] TR25OC16.166

Where:

nref = reference molar flow rate.
vstdref = reference volume flow rate, corrected to a 
standard pressure and a standard temperature.
vactref = reference volume flow rate at the actual 
pressure and temperature of the flow rate.
mref = reference mass flow.
pstd = standard pressure.
pact = actual pressure of the flow rate.
Tstd = standard temperature.
Tact = actual temperature of the flow rate.
R = molar gas constant.
Mmix = molar mass of the flow rate.
    Example 1: 
vstdref = 1000.00 ft\3\/min = 0.471948 m\3\/s
pstd = 29.9213 in Hg @32[emsp14][deg]F = 101.325 kPa = 
101325 Pa = 101325 kg/(ms\2\)
Tstd = 68.0[emsp14][deg]F = 293.15 K
R = 8.314472 J/(molK) = 8.314472 (m\2\kg)/
(s\2\molK)
[GRAPHIC] [TIFF OMITTED] TR25OC16.167

nref = 19.619 mol/s

    Example 2: 
mref = 17.2683 kg/min = 287.805 g/s
Mmix = 28.7805 g/mol
[GRAPHIC] [TIFF OMITTED] TR25OC16.168

nref = 10.0000 mol/s

    (b) PDP calibration calculations. Perform the following steps to 
calibrate a PDP flow meter:
    (1) Calculate PDP volume pumped per revolution, Vrev, 
for each restrictor position from the mean values determined in Sec.  
1065.340 as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.169

Where:

nref = mean reference molar flow rate.
R = molar gas constant.
Tin = mean temperature at the PDP inlet.
Pin = mean static absolute pressure at the PDP inlet.
fnPDP = mean PDP speed.
    Example: 
nref = 25.096 mol/s
R = 8.314472 J/(mol[middot]K) = 8.314472 (m\2\[middot]kg)/
(s\2\[middot]mol[middot]K)
Tin = 299.5 K
Pin = 98.290 kPa = 98290 Pa = 98290 kg/(m[middot]s\2\)
fnPDP = 1205.1 r/min = 20.085 r/s

[[Page 74173]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.170

Vrev = 0.03166 m\3\/r

    (2) Calculate a PDP slip correction factor, Ks, for each 
restrictor position from the mean values determined in Sec.  1065.340 
as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.171

Where:
fnPDP = mean PDP speed.
Pout = mean static absolute pressure at the PDP outlet.
Pin = mean static absolute pressure at the PDP inlet.
    Example: 
fnPDP = 1205.1 r/min = 20.085 r/s
Pout = 100.103 kPa
Pin = 98.290 kPa
[GRAPHIC] [TIFF OMITTED] TR25OC16.172

Ks = 0.006700 s/r

    (3) Perform a least-squares regression of Vrev, versus 
Ks, by calculating slope, a1, and intercept, 
a0, as described in Sec.  1065.602.
    (4) Repeat the procedure in paragraphs (b)(1) through (3) of this 
section for every speed that you run your PDP.
    (5) The following table illustrates a range of typical values for 
different PDP speeds:

                           Table 1 of Sec.   1065.640--Example of PDP Calibration Data
----------------------------------------------------------------------------------------------------------------
                      fnPDP (revolution/s)                          a1 (m\3\/s)         a0 (m\3\/revolution)
----------------------------------------------------------------------------------------------------------------
12.6...........................................................              0.841                         0.056
16.5...........................................................              0.831                        -0.013
20.9...........................................................              0.809                         0.028
23.4...........................................................              0.788                        -0.061
----------------------------------------------------------------------------------------------------------------

    (6) For each speed at which you operate the PDP, use the 
appropriate regression equation from this paragraph (b) to calculate 
flow rate during emission testing as described in Sec.  1065.642.
    (c) Venturi governing equations and permissible assumptions. This 
section describes the governing equations and permissible assumptions 
for calibrating a venturi and calculating flow using a venturi. Because 
a subsonic venturi (SSV) and a critical-flow venturi (CFV) both operate 
similarly, their governing equations are nearly the same, except for 
the equation describing their pressure ratio, r (i.e., rSSV 
versus rCFV). These governing equations assume one-
dimensional isentropic inviscid flow of an ideal gas. Paragraph (c)(5) 
of this section describes other assumptions that may apply. If good 
engineering judgment dictates that you account for gas compressibility, 
you may either use an appropriate equation of state to determine values 
of Z as a function of measured pressure and temperature, or you may 
develop your own calibration equations based on good engineering 
judgment. Note that the equation for the flow coefficient, 
Cf, is based on the ideal gas assumption that the isentropic 
exponent, [gamma], is equal to the ratio of specific heats, 
Cp/Cv. If good engineering judgment dictates 
using a real gas isentropic exponent, you may either use an appropriate 
equation of state to determine values of [gamma] as a function of 
measured pressures and temperatures, or you may develop your own 
calibration equations based on good engineering judgment.
    (1) Calculate molar flow rate, n, as follows:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.173
    

[[Page 74174]]


Where:

    Cd = discharge coefficient, as determined in 
paragraph (c)(2) of this section.
    Cf = flow coefficient, as determined in paragraph 
(c)(3) of this section.
    At = venturi throat cross-sectional area.
    pin = venturi inlet absolute static pressure.
    Z = compressibility factor.
    Mmix = molar mass of gas mixture.
    R = molar gas constant.
    Tin = venturi inlet absolute temperature.

    (2) Using the data collected in Sec.  1065.340, calculate 
Cd for each flow rate using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.174

Where:

nref = a reference molar flow rate.

    (3) Determine Cf using one of the following methods:
    (i) For CFV flow meters only, determine CfCFV from the 
following table based on your values for [beta] and [gamma], using 
linear interpolation to find intermediate values:

 Table 2 of Sec.   1065.640-CfCFV Versus [beta] and [gamma] for CFV Flow
                                 Meters
------------------------------------------------------------------------
                                  CfCFV
-------------------------------------------------------------------------
                                                       [gamma]dexh =
         [beta]              [gamma]exh = 385        [gamma]air = 399
------------------------------------------------------------------------
            0.000                   0.6822                  0.6846
            0.400                   0.6857                  0.6881
            0.500                   0.6910                  0.6934
            0.550                   0.6953                  0.6977
            0.600                   0.7011                  0.7036
            0.625                   0.7047                  0.7072
            0.650                   0.7089                  0.7114
            0.675                   0.7137                  0.7163
            0.700                   0.7193                  0.7219
            0.720                   0.7245                  0.7271
            0.740                   0.7303                  0.7329
            0.760                   0.7368                  0.7395
            0.770                   0.7404                  0.7431
            0.780                   0.7442                  0.7470
            0.790                   0.7483                  0.7511
            0.800                   0.7527                  0.7555
            0.810                   0.7573                  0.7602
            0.820                   0.7624                  0.7652
            0.830                   0.7677                  0.7707
            0.840                   0.7735                  0.7765
            0.850                   0.7798                  0.7828
------------------------------------------------------------------------

    (ii) For any CFV or SSV flow meter, you may use the following 
equation to calculate Cf for each flow rate:
[GRAPHIC] [TIFF OMITTED] TR25OC16.175

Where:

[gamma] = isentropic exponent. For an ideal gas, this is the ratio 
of specific heats of the gas mixture, Cp/Cv.
r = pressure ratio, as determined in paragraph (c)(4) of this 
section.
[beta] = ratio of venturi throat to inlet diameters.

    (4) Calculate r as follows:
    (i) For SSV systems only, calculate rSSV using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.176

Where:

[Delta]pSSV = Differential static pressure; venturi inlet 
minus venturi throat.

    (ii) For CFV systems only, calculate rCFV iteratively 
using the following equation:

[[Page 74175]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.177

    (5) You may apply any of the following simplifying assumptions or 
develop other values as appropriate for your test configuration, 
consistent with good engineering judgment:
    (i) For raw exhaust, diluted exhaust, and dilution air, you may 
assume that the gas mixture behaves as an ideal gas: Z = 1.
    (ii) For raw exhaust, you may assume [gamma] = 1.385.
    (iii) For diluted exhaust and dilution air, you may assume [gamma] 
= 1.399.
    (iv) For diluted exhaust and dilution air, you may assume the molar 
mass of the mixture, Mmix, is a function only of the amount 
of water in the dilution air or calibration air, as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.178

Where:

Mair = molar mass of dry air.
xH2O = amount of H2O in the dilution air or 
calibration air, determined as described in Sec.  1065.645.
MH2O = molar mass of water.

    Example: 
Mair = 28.96559 g/mol
xH2O = 0.0169 mol/mol
MH2O = 18.01528 g/mol
Mmix = 28.96559 [middot] (1- 0.0169) + 18.01528 [middot] 
0.0169
Mmix = 28.7805 g/mol

    (v) For diluted exhaust and dilution air, you may assume a constant 
molar mass of the mixture, Mmix, for all calibration and all 
testing as long as your assumed molar mass differs no more than 1% from the estimated minimum and maximum molar mass during 
calibration and testing.
    You may assume this, using good engineering judgment, if you 
sufficiently control the amount of water in calibration air and in 
dilution air or if you remove sufficient water from both calibration 
air and dilution air. The following table gives examples of permissible 
ranges of dilution air dewpoint versus calibration air dewpoint:

  Table 3 of Sec.   1065.640--Examples of Dilution Air and Calibration Air Dewpoints at Which You May Assume a
                                                  Constant Mmix
----------------------------------------------------------------------------------------------------------------
                                                                     assume the
                                                                     following       for the following ranges of
             If calibration Tdew ([deg]C) is . . .               constant Mmix (g/      Tdew ([deg]C) during
                                                                     mol) . . .          emission tests \a\
----------------------------------------------------------------------------------------------------------------
dry............................................................           28.96559                     dry to 18
0..............................................................           28.89263                     dry to 21
5..............................................................           28.86148                     dry to 22
10.............................................................           28.81911                     dry to 24
15.............................................................           28.76224                     dry to 26
20.............................................................           28.68685                      -8 to 28
25.............................................................           28.58806                      12 to 31
30.............................................................           28.46005                      23 to 34
----------------------------------------------------------------------------------------------------------------
\a\ Range valid for all calibration and emission testing over the atmospheric pressure range (80.000 to 103.325)
  kPa.

    (6) The following example illustrates the use of the governing 
equations to calculate Cd of an SSV flow meter at one 
reference flow meter value. Note that calculating Cd for a 
CFV flow meter would be similar, except that Cf would be 
determined from Table 2 of this section or calculated iteratively using 
values of [beta] and [gamma] as described in paragraph (c)(2) of this 
section.

    Example: 
nref = 57.625 mol/s
Z = 1
Mmix = 28.7805 g/mol = 0.0287805 kg/mol
R = 8.314472 J/(mol [middot] K) = 8.314472 (m\2\ [middot] kg)/(s\2\ 
[middot] mol [middot] K)
Tin = 298.15 K
At = 0.01824 m\2\
pin = 99.132 kPa = 99132.0 Pa = 99132 kg/(m[middot]s\2\)
[gamma] = 1.399
[beta] = 0.8
[Delta]p = 2.312 kPa

[[Page 74176]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.179

Cf = 0.274
[GRAPHIC] [TIFF OMITTED] TR25OC16.314

Cd = 0.982

    (d) SSV calibration. Perform the following steps to calibrate an 
SSV flow meter:
    (1) Calculate the Reynolds number, Re#, for each 
reference molar flow rate, nref, using the throat diameter 
of the venturi, dt. Because the dynamic viscosity, [mu], is 
needed to compute Re#, you may use your own fluid viscosity 
model to determine [mu] for your calibration gas (usually air), using 
good engineering judgment. Alternatively, you may use the Sutherland 
three-coefficient viscosity model to approximate [mu], as shown in the 
following sample calculation for Re#:
[GRAPHIC] [TIFF OMITTED] TR25OC16.315

    Where, using the Sutherland three-coefficient viscosity model:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.180
    
Where:

[mu][ihel0] = Sutherland reference viscosity.
T[ihel0] = Sutherland reference temperature.
S = Sutherland constant.

                                  Table 4 of Sec.   1065.640-- Sutherland Three-Coefficient Viscosity Model Parameters
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                            [mu][ihel0]        T[ihel0]            S          Temperature range within          Pressure limit \b\
                                         ---------------------------------------------------   2% error \b\ --------------------------------
                 Gas \a\                                                                    ----------------------------
                                          kg/(m[middot]s)         K                K                      K                            kPa
--------------------------------------------------------------------------------------------------------------------------------------------------------
Air.....................................   1.716 [middot]              273              111  170 to 1900...............  <= 1800
                                                   10-\5\
CO[ihel2]...............................   1.370 [middot]              273              222  190 to 1700...............  <= 3600
                                                   10-\5\
H[ihel2]................................    1.12 [middot]              350             1064  360 to 1500...............  <= 10000
                                                   10-\5\
O[ihel2]................................   1.919 [middot]              273              139  190 to 2000...............  <= 2500
                                                   10-\5\
N[ihel2]................................   1.663 [middot]              273              107  100 to 1500...............  <= 1600
                                                   10-\5\
--------------------------------------------------------------------------------------------------------------------------------------------------------
\a\ Use tabulated parameters only for the pure gases, as listed. Do not combine parameters in calculations to calculate viscosities of gas mixtures.
\b\ The model results are valid only for ambient conditions in the specified ranges.

    Example: 
[mu]0 = 1.716 [middot] 10-\5\ kg/(m[middot]s)
T[ihel0] = 273 K
S = 111 K

[[Page 74177]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.181

[mu] = 1.838 [middot] 10-5 kg/(m[middot]s)
Mmix = 28.7805 g/mol
nref = 57.625 mol/s
dt = 152.4 mm = 0.1524 m
Tin = 298.15 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.182

Re# = 7.538[middot]108

    (2) Create an equation for Cd as a function of 
Re#, using paired values of the two quantities. The equation 
may involve any mathematical expression, including a polynomial or a 
power series. The following equation is an example of a commonly used 
mathematical expression for relating Cd and Re#:
[GRAPHIC] [TIFF OMITTED] TR25OC16.183

    (3) Perform a least-squares regression analysis to determine the 
best-fit coefficients for the equation and calculate SEE as described 
in Sec.  1065.602.
    (4) If the equation meets the criterion of SEE <= 0.5% [middot] 
Cdmax, you may use the equation for the corresponding range 
of Re#, as described in Sec.  1065.642.
    (5) If the equation does not meet the specified statistical 
criterion, you may use good engineering judgment to omit calibration 
data points; however you must use at least seven calibration data 
points to demonstrate that you meet the criterion. For example, this 
may involve narrowing the range of flow rates for a better curve fit.
    (6) Take corrective action if the equation does not meet the 
specified statistical criterion even after omitting calibration data 
points. For example, select another mathematical expression for the 
Cd versus Re# equation, check for leaks, or 
repeat the calibration process. If you must repeat the calibration 
process, we recommend applying tighter tolerances to measurements and 
allowing more time for flows to stabilize.
    (7) Once you have an equation that meets the specified statistical 
criterion, you may use the equation only for the corresponding range of 
Re#.
    (e) * * *
    (3) If the standard deviation of all the Cd values is 
less than or equal to 0.3% of the mean Cd, use the mean 
Cd in Eq. 1065.642-4, and use the CFV only up to the highest 
venturi pressure ratio, r, measured during calibration using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.184

Where:

[Delta]pCFV = Differential static pressure; venturi inlet 
minus venturi outlet.
* * * * *


0
265. Section 1065.642 is revised to read as follows:


Sec.  1065.642  PDP, SSV, and CFV molar flow rate calculations.

    This section describes the equations for calculating molar flow 
rates from various flow meters. After you calibrate a flow meter 
according to Sec.  1065.640, use the calculations described in this 
section to calculate flow during an emission test.
    (a) PDP molar flow rate. (1) Based on the speed at which you 
operate the PDP for a test interval, select the corresponding slope, 
a1, and intercept, a0, as calculated in Sec.  
1065.640, to calculate PDP molar flow rate,, as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.185


[[Page 74178]]


Where:

fnPDP = pump speed.
Vrev = PDP volume pumped per revolution, as determined in 
paragraph (a)(2) of this section.
pin = static absolute pressure at the PDP inlet.
R = molar gas constant.
Tin = absolute temperature at the PDP inlet.

    (2) Calculate Vrev using the following equation:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.186
    
pout = static absolute pressure at the PDP outlet.
    Example: 
a1 = 0.8405 (m\3\/s)
fnPDP = 12.58 r/s
Pout = 99.950 kPa
Pin = 98.575 kPa = 98575 Pa = 98575 kg/(m[middot]s\2\)
a0 = 0.056 (m\3\/r)
R = 8.314472 J/(mol[middot]K) = 8.314472 (m\2\[middot]kg)/
(s\2\[middot]mol[middot]K)
Tin = 323.5 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.187

[GRAPHIC] [TIFF OMITTED] TR25OC16.188

n = 29.428 mol/s

    (b) SSV molar flow rate. Calculate SSV molar flow rate, n, as 
follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.316

Where:

Cd = discharge coefficient, as determined based on the 
Cd versus Re# equation in Sec.  
1065.640(d)(2).
Cf = flow coefficient, as determined in Sec.  
1065.640(c)(2)(ii).
At = venturi throat cross-sectional area.
Pin = static absolute pressure at the venturi inlet.
Z = compressibility factor.
Mmix = molar mass of gas mixture.
R = molar gas constant.
Tin = absolute temperature at the venturi inlet.

    Example: 
At = 0.01824 m\2\
pin = 99.132 kPa = 99132 Pa = 99132 kg/(m[middot]s\2\)
Z = 1
Mmix = 28.7805 g/mol = 0.0287805 kg/mol
R = 8.314472 J/(mol[middot]K) = 8.314472 (m\2\[middot]kg)/
(s\2\[middot]mol[middot]K)
Tin = 298.15 K
Re# = 7.232[middot]10\5\
[gamma] = 1.399
[beta] = 0.8
[Delta]p = 2.312 kPa

    Using Eq. 1065.640-7, rssv = 0.997

    Using Eq. 1065.640-6, Cf = 0.274

    Using Eq. 1065.640-5, Cd = 0.990
    [GRAPHIC] [TIFF OMITTED] TR25OC16.189
    
n = 58.173 mol/s

    (c) CFV molar flow rate. If you use multiple venturis and you 
calibrate each venturi independently to determine a separate discharge 
coefficient, Cd (or calibration coefficient, Kv), 
for each venturi, calculate the individual molar flow rates through 
each venturi and sum all their flow rates to determine CFV flow rate, 
n. If you use multiple venturis and you calibrated venturis in 
combination, calculate n using the sum of the active venturi throat 
areas as At, the square root of the sum of the squares of 
the active venturi throat diameters as dt, and the ratio of 
the venturi throat to inlet diameters as the ratio of the square root 
of the sum of the active venturi throat diameters (dt) to 
the diameter of the common entrance to all the venturis (D).
    (1) To calculate n through one venturi or one combination of 
venturis, use its respective mean Cd and other constants you 
determined according to Sec.  1065.640 and calculate n as follows:

[[Page 74179]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.190

    Example: 
Cd = 0.985
Cf = 0.7219
At = 0.00456 m\2\
pin = 98.836 kPa = 98836 Pa = 98836 kg/(m[middot]s\2\)
Z = 1
Mmix = 28.7805 g/mol = 0.0287805 kg/mol
R = 8.314472 J/(mol[middot]K) = 8.314472 (m\2\[middot]kg)/
(s\2\[middot]mol[middot]K)
Tin = 378.15 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.191

n = 33.690 mol/s

    (2) To calculate the molar flow rate through one venturi or a 
combination of venturis, you may use its respective mean, 
Kv, and other constants you determined according to Sec.  
1065.640 and calculate its molar flow rate n during an emission test. 
Note that if you follow the permissible ranges of dilution air dewpoint 
versus calibration air dewpoint in Table 3 of Sec.  1065.640, you may 
set Mmix-cal and Mmix equal to 1. Calculate n as 
follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.192

Where:
[GRAPHIC] [TIFF OMITTED] TR25OC16.193

Vstdref = volume flow rate of the standard at reference 
conditions of 293.15 K and 101.325 kPa.
Tin-cal = venturi inlet temperature during calibration.
Pin-cal = venturi inlet pressure during calibration.
Mmix-cal = molar mass of gas mixture used during 
calibration.
Mmix = molar mass of gas mixture during the emission test 
calculated using Eq. 1065.640-9.

    Example: 
Vstdref = 0.4895 m\3\
Tin-cal = 302.52 K
Pin-cal = 99.654 kPa = 99654 Pa = 99654 kg/
(m[middot]s\2\)
pin = 98.836 kPa = 98836 Pa = 98836 kg/(m[middot]s\2\)
pstd = 101.325 kPa = 101325 Pa = 101325 kg/
(m[middot]s\2\)
Mmix-cal = 28.9656 g/mol = 0.0289656 kg/mol
Mmix = 28.7805 g/mol = 0.0287805 kg/mol
Tin = 353.15 K
Tstd = 293.15 K
R = 8.314472 J/(mol[middot]K) = 8.314472 (m\2\[middot]kg)/
(s\2\[middot]mol[middot]K)
[GRAPHIC] [TIFF OMITTED] TR25OC16.194

n = 16.457 mol/s


0
266. Section 1065.645 is amended by revising paragraphs (c) and (d) to 
read as follows:


Sec.  1065.645  Amount of water in an ideal gas.

* * * * *
    (c) Relative humidity. If you measure humidity as a relative 
humidity, RH, determine the amount of water in an ideal gas, 
xH2O, as follows:

[[Page 74180]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.195

Where:

xH2O = amount of water in an ideal gas.
RH = relative humidity.
pH2O = water vapor pressure at 100% relative humidity at 
the location of your relative humidity measurement, Tsat 
= Tamb.
pabs = wet static absolute pressure at the location of 
your relative humidity measurement.

    Example: 
RH = 50.77% = 0.5077
pabs = 99.980 kPa
Tsat = Tamb = 20 [deg]C
    Using Eq. 1065.645-1,
pH2O = 2.3371 kPa
xH2O = (0.5077 [middot] 2.3371)/99.980
xH2O = 0.011868 mol/mol

    (d) Dewpoint determination from relative humidity and dry bulb 
temperature. This paragraph (d) describes how to calculate dewpoint 
temperature from relative humidity, RH. This is based on ``ITS-90 
Formulations for Vapor Pressure, Frostpoint Temperature, Dewpoint 
Temperature, and Enhancement Factors in the Range -100 to + 100 
[deg]C'' (Hardy, B., The Proceedings of the Third International 
Symposium on Humidity & Moisture, Teddington, London, England, April 
1998). Calculate pH20sat as described in paragraph (a) of 
this section based on setting Tsat equal to Tamb. 
Calculate pH20scaled by multiplying pH20sat by 
RH. Calculate the dewpoint, Tdew, from pH20 using 
the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.196

Where:


ln(pH2O) = the natural log of pH2Oscaled, 
which is the water vapor pressure scaled to the relative humidity at 
the location of the relative humidity measurement, Tsat = 
Tamb

    Example: 
RH = 39.61% = 0.3961
Tsat = Tamb = 20.00 [deg]C = 293.15K
    Using Eq. 1065.645-1,
pH2Osat = 2.3371 kPa
pH2Oscaled = (0.3961 [middot] 2.3371) = 0.925717 kPa = 
925.717 Pa
[GRAPHIC] [TIFF OMITTED] TR25OC16.197


0
267. Section 1065.650 is amended by adding paragraph (c)(6) and 
revising paragraphs (e)(2), (f)(2), (f)(4), and (g)(2)(ii) to read as 
follows:


Sec.  1065.650  Emission calculations.

* * * * *
    (c) * * *
    (6) Mass of NMNEHC. If the test fuel has less than 0.010 mol/mol of 
ethane and you omit the NMNEHC calculations as described in Sec.  
1065.660(c)(1), take the corrected mass of NMNEHC to be 0.95 times the 
corrected mass of NMHC.
* * * * *
    (e) * * *
    (2) To calculate an engine's mean steady-state total power, P, add 
the mean steady-state power from all the work paths described in Sec.  
1065.210 that cross the system boundary including electrical power, 
mechanical shaft power, and fluid pumping power. For all work paths, 
except the engine's primary output shaft (crankshaft), the mean steady-
state power over the test interval is the integration of the net work 
flow rate (power) out of the system boundary divided by the period of 
the test interval. When power flows into the system boundary, the 
power/work flow rate signal becomes negative; in this case, include 
these negative power/work rate values in the integration to calculate 
the mean power from that work path. Some work paths may result in a 
negative mean power. Include negative mean power values from any work 
path in the mean total power from the engine rather than setting these 
values to zero. The rest of this paragraph (e)(2) describes how to 
calculate the mean power from the engine's primary output shaft. 
Calculate P using Eq. 1065.650-13, noting that P, fn, and T 
refer to mean power, mean rotational shaft frequency, and mean torque 
from the primary output shaft. Account for the power of simulated 
accessories according to Sec.  1065.110 (reducing the mean primary 
output shaft power or torque by the accessory power or torque). Set the 
power to zero during actual motoring operation (negative feedback 
torques), unless the engine was connected to one or more energy storage 
devices. Examples of such energy storage devices include hybrid 
powertrain batteries and hydraulic accumulators, like the ones 
illustrated in Figure 1 of Sec.  1065.210. Set the power to zero for 
modes with a zero reference load (0 N[middot]m reference torque or 0 kW 
reference power). Include power during idle modes with simulated 
minimum torque or power.

[[Page 74181]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.198

* * * * *
    (f) * * *
    (2) Total work. To calculate a value proportional to total work 
over a test interval, integrate a value that is proportional to power. 
Use information about the brake-specific fuel consumption of your 
engine, efuel, to convert a signal proportional to fuel flow 
rate to a signal proportional to power. To determine a signal 
proportional to fuel flow rate, divide a signal that is proportional to 
the mass rate of carbon products by the fraction of carbon in your 
fuel, wC. You may use a measured wC or you may 
use default values for a given fuel as described in Sec.  1065.655(e). 
Calculate the mass rate of carbon from the amount of carbon and water 
in the exhaust, which you determine with a chemical balance of fuel, 
intake air, and exhaust as described in Sec.  1065.655. In the chemical 
balance, you must use concentrations from the flow that generated the 
signal proportional to molar flow rate, nj, in paragraph (e)(1) of this 
section. Calculate a value proportional to total work as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.199

Where:
[GRAPHIC] [TIFF OMITTED] TR25OC16.200

* * * * *
    (4)

    Example:  The following example shows how to calculate mass of 
emissions using proportional values:
N = 3000
[fnof]record = 5 Hz
efuel = 285 g/(kW[middot]hr)
wfuel = 0.869 g/g
MC = 12.0107 g/mol
nj1 = 3.922 mol/s = 14119.2 mol/hr
[khgr]Ccombdry1 = 91.634 mmol/mol = 0.091634 mol/mol
[khgr]H2Oexh1 = 27.21 mmol/mol = 0.02721 mol/mol
    Using Eq. 1065.650-5,
[Delta]t = 0.2 s
[GRAPHIC] [TIFF OMITTED] TR25OC16.201

W = 5.09 (kW[middot]hr)

    (g) * * *
    (2) * * *
    (ii) Use the following equation if you calculate brake-specific 
emissions over test intervals based on the ratio of mass rate to power 
as described in paragraph (b)(2) of this section:
[GRAPHIC] [TIFF OMITTED] TR25OC16.202

Where:

i = test interval number.
N = number of test intervals.
WF = weighting factor for the test interval as defined in the 
standard-setting part.

[[Page 74182]]

mi = mean steady-state mass rate of emissions over the test interval 
as determined in paragraph (e) of this section.
P = mean steady-state power over the test interval as described in 
paragraph (e) of this section.

    Example: 
N = 2
WF1 = 0.85
WF2 = 0.15
mi1 = 2.25842 g/hr
mi2 = 0.063443 g/hr
P1 = 4.5383 kW
P2 = 0.0 kW
[GRAPHIC] [TIFF OMITTED] TR25OC16.203

eNOxcomposite = 0.5001 g/kW[middot]hr
* * * * *

0
268. Section 1065.655 is amended as follows:
0
a. By revising paragraphs (a), (b), (c) introductory text, (c)(3), and 
(d).
0
b. By redesignating paragraphs (e) and (f) as paragraphs (f) and (g), 
respectively.
0
c. By adding a new paragraph (e).
0
d. By revising the newly redesignated paragraph (f)(3).
    The revisions and additions read as follows:


Sec.  1065.655  Chemical balances of fuel, intake air, and exhaust.

    (a) General. Chemical balances of fuel, intake air, and exhaust may 
be used to calculate flows, the amount of water in their flows, and the 
wet concentration of constituents in their flows. With one flow rate of 
either fuel, intake air, or exhaust, you may use chemical balances to 
determine the flows of the other two. For example, you may use chemical 
balances along with either intake air or fuel flow to determine raw 
exhaust flow. Note that chemical balance calculations require measured 
values for the flow rate of diesel exhaust fluid, if applicable.
    (b) Procedures that require chemical balances. We require chemical 
balances when you determine the following:
    (1) A value proportional to total work, W, when you choose to 
determine brake-specific emissions as described in Sec.  1065.650(f).
    (2) Raw exhaust molar flow rate either from measured intake air 
molar flow rate or from fuel mass flow rate as described in paragraph 
(f) of this section.
    (3) Raw exhaust molar flow rate from measured intake air molar flow 
rate and dilute exhaust molar flow rate, as described in paragraph (g) 
of this section.
    (4) The amount of water in a raw or diluted exhaust flow, 
[chi]H2Oexh, when you do not measure the amount of water to 
correct for the amount of water removed by a sampling system. Correct 
for removed water according to Sec.  1065.659.
    (5) The calculated total dilution air flow when you do not measure 
dilution air flow to correct for background emissions as described in 
Sec.  1065.667(c) and (d).
    (c) Chemical balance procedure. The calculations for a chemical 
balance involve a system of equations that require iteration. We 
recommend using a computer to solve this system of equations. You must 
guess the initial values of up to three quantities: The amount of water 
in the measured flow, [chi]H2Oexh, fraction of dilution air 
in diluted exhaust, [chi]dil/exh, and the amount of products 
on a C1 basis per dry mole of dry measured flow, 
[chi]Ccombdry. You may use time-weighted mean values of 
combustion air humidity and dilution air humidity in the chemical 
balance; as long as your combustion air and dilution air humidities 
remain within tolerances of 0.0025 mol/mol of their 
respective mean values over the test interval. For each emission 
concentration, [chi], and amount of water, [chi]H2Oexh, you 
must determine their completely dry concentrations, [chi]dry 
and [chi]H2Oexhdry. You must also use your fuel mixture's 
atomic hydrogen-to-carbon ratio, [alpha], oxygen-to-carbon ratio, 
[beta], sulfur-to-carbon ratio, [gamma], and nitrogen-to-carbon ratio, 
[delta], you may optionally account for diesel exhaust fluid (or other 
fluids injected into the exhaust), if applicable. You may calculate 
[alpha], [beta], [gamma], and [delta] based on measured fuel and diesel 
exhaust fluid composition or you may use default values as described in 
paragraph (e) of this section. Use the following steps to complete a 
chemical balance:
* * * * *
    (3) Use the following symbols and subscripts in the equations for 
performing the chemical balance calculations in this paragraph (c):

[chi]dil/exh = amount of dilution gas or excess air per 
mole of exhaust.
[chi]H2Oexh = amount of H2O in exhaust per 
mole of exhaust.
[chi]Ccombdry = amount of carbon from fuel in the exhaust 
per mole of dry exhaust.
[chi]H2dry = amount of H2 in exhaust per 
amount of dry exhaust.
KH2Ogas = water-gas reaction equilibrium coefficient. You 
may use 3.5 or calculate your own value using good engineering 
judgment.
[chi]H2Oexhdry = amount of H2O in exhaust per 
dry mole of dry exhaust.
[chi]prod/intdry = amount of dry stoichiometric products 
per dry mole of intake air.
[chi]dil/exhdry = amount of dilution gas and/or excess 
air per mole of dry exhaust.
[chi]int/exhdry = amount of intake air required to 
produce actual combustion products per mole of dry (raw or diluted) 
exhaust.
[chi]raw/exhdry = amount of undiluted exhaust, without 
excess air, per mole of dry (raw or diluted) exhaust.
[chi]O2int = amount of intake air O2 per mole 
of intake air.
[chi]CO2intdry = amount of intake air CO2 per 
mole of dry intake air. You may use [chi]CO2intdry = 375 
[mu]mol/mol, but we recommend measuring the actual concentration in 
the intake air.
[chi]H2Ointdry = amount of intake air H2O per 
mole of dry intake air.
[chi]CO2int = amount of intake air CO2 per 
mole of intake air.
[chi]CO2dil = amount of dilution gas CO2 per 
mole of dilution gas.
[chi]CO2dildry = amount of dilution gas CO2 
per mole of dry dilution gas. If you use air as diluent, you may use 
[chi]CO2dildry = 375 [micro]mol/mol, but we recommend 
measuring the actual concentration in the intake air.
[chi]H2Odildry = amount of dilution gas H2O 
per mole of dry dilution gas.
[chi]H2Odil = amount of dilution gas H2O per 
mole of dilution gas.
[chi][emission]meas = amount of measured emission in the 
sample at the respective gas analyzer.
[chi][emission]dry = amount of emission per dry mole of 
dry sample.
[chi]H2O[emission]meas = amount of H2O in 
sample at emission-detection location. Measure or estimate these 
values according to Sec.  1065.145(e)(2).
[chi]H2Oint = amount of H2O in the intake air, 
based on a humidity measurement of intake air.
[alpha] = atomic hydrogen-to-carbon ratio of the fuel (or mixture of 
test fuels) and any injected fluids.
[beta] = atomic oxygen-to-carbon ratio of the fuel (or mixture of 
test fuels) and any injected fluids.
[gamma] = atomic sulfur-to-carbon ratio of the fuel (or mixture of 
test fuels) and any injected fluids.
[delta] = atomic nitrogen-to-carbon ratio of the fuel (or mixture of 
test fuels) and any injected fluids.
* * * * *

    (d) Carbon mass fraction of fuel. Determine carbon mass fraction of 
fuel,

[[Page 74183]]

wC, based on the fuel properties as determined in paragraph 
(e) of this section, accounting for diesel exhaust fluid's contribution 
to [alpha], [beta], [gamma], and [delta], or that of any other fluid 
injected into the exhaust, if applicable. Calculate wC using 
the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.204

Where:

wC = carbon mass fraction of the fuel (or mixture of test 
fuels) and any injected fluids.
MC = molar mass of carbon.
[alpha] = atomic hydrogen-to-carbon ratio of the fuel (or mixture of 
test fuels) and any injected fluids.
MH = molar mass of hydrogen.
[beta] = atomic oxygen-to-carbon ratio of the fuel (or mixture of 
test fuels) and any injected fluids.
MO = molar mass of oxygen.
[gamma] = atomic sulfur-to-carbon ratio of the fuel (or mixture of 
test fuels) and any injected fluids.
MS = molar mass of sulfur.
[delta] = atomic nitrogen-to-carbon ratio of the fuel (or mixture of 
test fuels) and any injected fluids.
MN = molar mass of nitrogen.

    Example: 
[alpha] = 1.8
[beta] = 0.05
[gamma] = 0.0003
[delta] = 0.0001
MC = 12.0107
MH = 1.00794
MO = 15.9994
MS = 32.065
MN = 14.0067
[GRAPHIC] [TIFF OMITTED] TR25OC16.205

wC = 0.8206

    (e) Fuel and diesel exhaust fluid composition. Determine fuel and 
diesel exhaust fluid composition represented by [alpha], [beta], 
[gamma], and [delta] as described in this paragraph (e). When using 
measured fuel or diesel exhaust fluid properties, you must determine 
values for [alpha] and [beta] in all cases. If you determine 
compositions based on measured values and the default value listed in 
Table 1 of this section is zero, you may set [gamma] and [delta] to 
zero; otherwise determine [gamma] and [delta] (along with [alpha] and 
[beta]) based on measured values. Determine elemental mass fractions 
and values for [alpha], [beta], [gamma], and [delta] as follows:
    (1) For liquid fuels, use the default values for [alpha], [beta], 
[gamma], and [delta] in Table 1 of this section or determine mass 
fractions of liquid fuels for calculation of [alpha], [beta], [gamma], 
and [delta] as follows:
    (i) Determine the carbon and hydrogen mass fractions according to 
ASTM D5291 (incorporated by reference in Sec.  1065.1010). When using 
ASTM D5291 to determine carbon and hydrogen mass fractions of gasoline 
(with or without blended ethanol), use good engineering judgment to 
adapt the method as appropriate. This may include consulting with the 
instrument manufacturer on how to test high-volatility fuels. Allow the 
weight of volatile fuel samples to stabilize for 20 minutes before 
starting the analysis; if the weight still drifts after 20 minutes, 
prepare a new sample. Retest the sample if the carbon, hydrogen, and 
oxygen mass fractions do not add up to a total mass of 100 0.5%; if you do not measure oxygen, you may assume it has a zero 
concentration for this specification.
    (ii) Determine oxygen mass fraction of gasoline (with or without 
blended ethanol) according to ASTM D5599 (incorporated by reference in 
Sec.  1065.1010). For all other liquid fuels, determine the oxygen mass 
fraction using good engineering judgment.
    (iii) Determine the nitrogen mass fraction according to ASTM D4629 
or ASTM D5762 (incorporated by reference in Sec.  1065.1010) for all 
liquid fuels. Select the correct method based on the expected nitrogen 
content.
    (iv) Determine the sulfur mass fraction according to subpart H of 
this part.
    (2) For gaseous fuels and diesel exhaust fluid, use the default 
values for [alpha], [beta], [gamma], and [delta] in Table 1 of this 
section, or use good engineering judgment to determine those values 
based on measurement.
    (3) For nonconstant fuel mixtures, you must account for the varying 
proportions of the different fuels. This generally applies for dual-
fuel engines, but it also applies if diesel exhaust fluid is injected 
in a way that is not strictly proportional to fuel flow. Account for 
these varying concentrations either with a batch measurement that 
provides averaged values to represent the test interval, or by 
analyzing data from continuous mass rate measurements. Application of 
average values from a batch measurement generally applies to situations 
where one fluid is a minor component of the total fuel mixture, for 
example dual-fuel engines with diesel pilot injection, where the diesel 
pilot fuel mass is less than 5% of the total fuel mass and diesel 
exhaust fluid injection; consistent with good engineering judgment.
    (4) Calculate [alpha], [beta], [gamma], and [delta] using the 
following equations:
[GRAPHIC] [TIFF OMITTED] TR25OC16.206

[GRAPHIC] [TIFF OMITTED] TR25OC16.207


[[Page 74184]]


[GRAPHIC] [TIFF OMITTED] TR25OC16.208

[GRAPHIC] [TIFF OMITTED] TR25OC16.209

Where:

M = total number of fuels and injected fluids over the duty cycle.
j = an indexing variable that represents one fuel or injected fluid, 
starting with j = 1.
mj = the mass flow rate of the fuel or any injected fluid 
j. For applications using a single fuel and no DEF fluid, set this 
value to 1. For batch measurements, divide the total mass of fuel 
over the test interval duration to determine a mass rate.
WHj = hydrogen mass fraction of fuel or any injected 
fluid j.
WCj = carbon mass fraction of fuel or any injected fluid 
j.
WOj = oxygen mass fraction of fuel or any injected fluid 
j.
WSj = sulfur mass fraction of fuel or any injected fluid 
j.
WNj = nitrogen mass fraction of fuel or any injected 
fluid j.

    Example: 
N = 1
j = 1
mj = 1
WHj = 0.1239
WCj = 0.8206
WOj = 0.0547
WSj = 0.00066
WNj = 0.000095
MC = 12.0107
MH = 1.00794
MO = 15.9994
MS = 32.065
MN = 14.0067
[GRAPHIC] [TIFF OMITTED] TR25OC16.210

[GRAPHIC] [TIFF OMITTED] TR25OC16.317

[alpha] = 1.799
[beta] = 0.05004
[gamma] = 0.0003012
[delta] = 0.0001003

             Table 1 of Sec.   1065.655--Default Values of [alpha], [beta],[gamma], [delta], and WC
----------------------------------------------------------------------------------------------------------------
                                                                                                    Carbon mass
            Fuel or injected fluid             Atomic hydrogen, oxygen, sulfur, and nitrogen-to-  fraction, WC g/
                                                 carbon ratios CH[alpha]O[beta]S[gamma]N[delta]          g
----------------------------------------------------------------------------------------------------------------
Gasoline.....................................  CH1.85O0S0N0.....................................           0.866
E10 Gasoline.................................  CH1.92O0.03S0N0..................................           0.833
E15 Gasoline.................................  CH1.95O0.05S0N0..................................           0.817
E85 Gasoline.................................  CH2.73O0.38S0N0..................................           0.576
E100 Ethanol.................................  CH3O0.5S0N0......................................           0.521
M100 Methanol................................  CH4O1S0N0........................................           0.375
#1 Diesel....................................  CH1.93O0S0N0.....................................           0.861
#2 Diesel....................................  CH1.80O0S0N0.....................................           0.869
Liquefied petroleum gas......................  CH2.64O0S0N0.....................................           0.819
Natural gas..................................  CH3.78 O0.016S0N0................................           0.747
Residual fuel blends.........................    Must be determined by measured fuel properties as described in
                                                                paragraph (d)(1) of this section.
                                              ------------------------------------------------------------------
Diesel exhaust fluid.........................  CH17.85O7.92S0N2.................................           0.065
----------------------------------------------------------------------------------------------------------------

    (f) * * *
    (3) Fluid mass flow rate calculation. This calculation may be used 
only for steady-state laboratory testing. See Sec.  1065.915(d)(5)(iv) 
for application to field testing. Calculate nexh based on 
using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.211

Where:

nexh = raw exhaust molar flow rate from which you 
measured emissions.
N = total number of fuels and injected fluids over the duty cycle.
j = an indexing variable that represents one fuel or injected fluid, 
starting with j = 1.
mj = the mass flow rate of the fuel or any injected fluid 
j.

    Example: 
N = 1
j = 1
mj = 7.559 g/s
wC = 0.869 g/g
MC = 12.0107 g/mol
XCcombdry = 99.87 mmol/mol = 0.09987 mol/mol
XH20exhdry = 107.64 mmol/mol = 0.10764 mol/mol
[GRAPHIC] [TIFF OMITTED] TR25OC16.212

nexh = 6.066 mol/s
* * * * *


0
269. Section 1065.660 is amended as follows:
0
a. By revising the section heading.
0
b. By revising paragraphs (a)(2) and (3).
0
c. By adding paragraph (a)(4).
0
d. By revising paragraph (b)(3).
0
e. By adding paragraph (b)(4).
0
f. By redesignating paragraph (c) as paragraph (d).
0
g. By adding a new paragraph (c).
0
h. By revising newly redesignated paragraph (d).
0
i. By adding paragraph (e).
    The revisions and additions read as follows:


Sec.  1065.660  THC, NMHC, NMNEHC, CH4, and 
C2H6 determination.

* * * * *
    (a) * * *
    (2) For the NMHC determination described in paragraph (b) of this 
section, correct xTHC[THC-FID] for initial THC contamination 
using Eq. 1065.660-

[[Page 74185]]

1. You may correct xTHC[NMC-FID] for initial contamination 
of the CH4 sample train using Eq. 1065.660-1, substituting 
in CH4 concentrations for THC.
    (3) For the NMNEHC determination described in paragraph (c) of this 
section, correct xTHC[THC-FID] for initial THC contamination 
using Eq. 1065.660-1. You may correct xTHC[NMC-FID] for 
initial contamination of the CH4 sample train using Eq. 
1065.660-1, substituting in CH4 concentrations for THC.
    (4) For the CH4 determination described in paragraph (d) 
of this section, you may correct xTHC[NMC-FID] for initial 
THC contamination of the CH4 sample train using Eq. 
1065.660-1, substituting in CH4 concentrations for THC.
    (b) * * *
    (3) For a GC-FID or FTIR, calculate xNMHC using the THC 
analyzer's response factor (RF) for CH4, from Sec.  
1065.360, and the initial THC contamination and dry-to-wet corrected 
THC concentration xTHC[THC-FID]cor as determined in 
paragraph (a) of this section as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.213

Where:

xNMHC = concentration of NMHC.
xTHC[THC-FID]cor = concentration of THC, initial THC 
contamination and dry-to-wet corrected, as measured by the THC FID.
RFCH4[THC-FID] = response factor of THC-FID to 
CH4.
xCH4 = concentration of CH4, dry-to-wet 
corrected, as measured by the GC-FID or FTIR.

    Example: 
xTHC[THC-FID]cor = 145.6 [mu]mol/mol
RFCH4[THC-FID] = 0.970
xCH4 = 18.9 [mu]mol/mol
xNMHC = 145.6-0.970 [middot] 18.9
xNMHC = 127.3 [mu]mol/mol
    (4) For an FTIR, calculate xNMHC by summing the 
hydrocarbon species listed in Sec.  1065.266(c) as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.214

Where:

xNMHC = concentration of NMHC.
xHCi = the C1-equivalent concentration of 
hydrocarbon species i as measured by the FTIR, not corrected for 
initial contamination.
xHCi-init = the C1-equivalent concentration of 
the initial system contamination (optional) of hydrocarbon species 
i, dry-to-wet corrected, as measured by the FTIR.
    Example: 
xC2H6 = 4.9 [mu]mol/mol
xC2H4 = 0.9 [mu]mol/mol
xC2H2 = 0.8 [mu]mol/mol
xC3H8 = 0.4 [mu]mol/mol
xC3H6 = 0.5 [mu]mol/mol
xC4H10 = 0.3 [mu]mol/mol
xCH2O = 0.8 [mu]mol/mol
xC2H4O = 0.3 [mu]mol/mol
xC2H2O2 = 0.1 [mu]mol/mol
xCH4O = 0.1 [mu]mol/mol
xNMHC = 4.9 + 0.9 + 0.8 + 0.4 + 0.5 + 0.3 + 0.8 + 0.3 + 
0.1 + 0.1
xNMHC = 9.1 [mu]mol/mol

    (c) NMNEHC determination. Use one of the following methods to 
determine NMNEHC concentration, xNMNEHC:
    (1) If the content of your test fuel contains less than 0.010 mol/
mol of ethane, you may omit the calculation of NMNEHC concentrations 
and calculate the mass of NMNEHC as described in Sec.  1065.650(c)(6).
    (2) For a GC-FID or FTIR, calculate xNMNEHC using the 
THC analyzer's response factors (RF) for CH4 and 
C2H6, from Sec.  1065.360, and the initial 
contamination and dry-to-wet corrected THC concentration 
xTHC[THC-FID]cor as determined in paragraph (a) of this 
section as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.215

Where:

xNMNEHC = concentration of NMNEHC.
xTHC[THC-FID]cor = concentration of THC, initial THC 
contamination and dry-to-wet corrected, as measured by the THC FID.
RFCH4[THC-FID] = response factor of THC-FID to 
CH4.
xCH4 = concentration of CH4, dry-to-wet 
corrected, as measured by the GC-FID or FTIR.
RFC2H6[THC-FID] = response factor of THC-FID to 
C2H6.
xC2H6 = the C1-equivalent concentration of 
C2H6, dry-to-wet corrected, as measured by the 
GC-FID or FTIR.
    Example: 
xTHC[THC-FID]cor = 145.6 [mu]mol/mol
RFCH4[THC-FID] = 0.970
xCH4 = 18.9 [mu]mol/mol
RFC2H6[THC-FID] = 1.02
xC2H6 = 10.6 [mu]mol/mol
xNMHC = 145.6--0.970 [middot] 18.9--1.02 [middot] 10.6
xNMHC = 116.5 [mu]mol/mol

    (3) For an FTIR, calculate xNMNEHC by summing the 
hydrocarbon species listed in Sec.  1065.266(c) as follows:

[[Page 74186]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.216

Where:

xNMNEHC = concentration of NMNEHC.
xHCi = the C1-equivalent concentration of 
hydrocarbon species i as measured by the FTIR, not corrected for 
initial contamination.
xHCi-init = the C1-equivalent concentration of 
the initial system contamination (optional) of hydrocarbon species 
i, dry-to-wet corrected, as measured by the FTIR.
    Example: 
xC2H4 = 0.9 [mu]mol/mol
xC2H2 = 0.8 [mu]mol/mol
xC3H8 = 0.4 [mu]mol/mol
xC3H6 = 0.5 [mu]mol/mol
xC4H10 = 0.3 [mu]mol/mol
xCH2O = 0.8 [mu]mol/mol
xC2H4O = 0.3 [mu]mol/mol
xC2H2O2 = 0.1 [mu]mol/mol
xCH4O = 0.1 [mu]mol/mol
xNMNEHC = 0.9 + 0.8 + 0.4 + 0.5 + 0.3 + 0.8 + 0.3 + 0.1 + 
0.1
xNMNEHC = 4.2 [mu]mol/mol

    (d) CH4 determination. Use one of the following methods 
to determine CH4 concentration, xCH4:
    (1) For nonmethane cutters, calculate xCH4 using the 
nonmethane cutter's penetration fraction (PF) of CH4 and the 
response factor penetration fraction (RFPF) of 
C2H6 from Sec.  1065.365, the response factor 
(RF) of the THC FID to CH4 from Sec.  1065.360, the initial 
THC contamination and dry-to-wet corrected THC concentration 
xTHC[THC-FID]cor as determined in paragraph (a) of this 
section, and the dry-to-wet corrected CH4 concentration 
xTHC[NMC-FID]cor optionally corrected for initial THC 
contamination as determined in paragraph (a) of this section.
    (i) Use the following equation for penetration fractions determined 
using an NMC configuration as outlined in Sec.  1065.365(d):
[GRAPHIC] [TIFF OMITTED] TR25OC16.217

Where:

xCH4 = concentration of CH4.
xTHC[NMC-FID]cor = concentration of THC, initial THC 
contamination (optional) and dry-to-wet corrected, as measured by 
the NMC FID during sampling through the NMC.
xTHC[THC-FID]cor = concentration of THC, initial THC 
contamination and dry-to-wet corrected, as measured by the THC FID 
during sampling while bypassing the NMC.
RFPFC2H6[NMC-FID] = the combined ethane response factor 
and penetration fraction of the nonmethane cutter, according to 
Sec.  1065.365(d).
RFCH4[THC-FID] = response factor of THC FID to 
CH4, according to Sec.  1065.360(d).

    Example: 
xTHC[NMC-FID]cor = 10.4 [mu]mol/mol
xTHC[THC-FID]cor = 150.3 [mu]mol/mol
RFPFC2H6[NMC-FID] = 0.019
RFCH4[THC-FID] = 1.05
[GRAPHIC] [TIFF OMITTED] TR25OC16.218

xCH4 = 7.69 [mu]mol/mol

    (ii) For penetration fractions determined using an NMC 
configuration as outlined in Sec.  1065.365(e), use the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.219

Where:

xCH4 = concentration of CH4.
xTHC[NMC-FID]cor = concentration of THC, initial THC 
contamination (optional) and dry-to-wet corrected, as measured by 
the NMC FID during sampling through the NMC.
xTHC[THC-FID]cor = concentration of THC, initial THC 
contamination and dry-to-wet corrected, as measured by the THC FID 
during sampling while bypassing the NMC.
PFC2H6[NMC-FID] = nonmethane cutter ethane penetration 
fraction, according to Sec.  1065.365(e).
RFCH4[THC-FID] = response factor of THC FID to 
CH4, according to Sec.  1065.360(d).
PFCH4[NMC-FID] = nonmethane cutter CH4 
penetration fraction, according to Sec.  1065.365(e).

    Example: 
xTHC[NMC-FID]cor = 10.4 [mu]mol/mol
xTHC[THC-FID]cor = 150.3 [mu]mol/mol
PFC2H6[NMC-FID] = 0.020
RFCH4[THC-FID] = 1.05
PFCH4[NMC-FID] = 0.990

[[Page 74187]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.220

xCH4 = 7.25 [mu]mol/mol

    (iii) For penetration fractions determined using an NMC 
configuration as outlined in Sec.  1065.365(f), use the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.221

Where:

xCH4 = concentration of CH4.
xTHC[NMC-FID]cor = concentration of THC, initial THC 
contamination (optional) and dry-to-wet corrected, as measured by 
the NMC FID during sampling through the NMC.
xTHC[THC-FID]cor = concentration of THC, initial THC 
contamination and dry-to-wet corrected, as measured by the THC FID 
during sampling while bypassing the NMC.
RFPFC2H6[NMC-FID] = the combined ethane response factor 
and penetration fraction of the nonmethane cutter, according to 
Sec.  1065.365(f).
PFCH4[NMC-FID] = nonmethane cutter CH4 
penetration fraction, according to Sec.  1065.365(f).
RFCH4[THC-FID] = response factor of THC FID to 
CH4, according to Sec.  1065.360(d).

    Example: 
xTHC[NMC-FID]cor = 10.4 [mu]mol/mol
xTHC[THC-FID]cor = 150.3 [mu]mol/mol
RFPFC2H6[NMC-FID] = 0.019
PFCH4[NMC-FID] = 0.990
RFCH4[THC-FID] = 1.05
[GRAPHIC] [TIFF OMITTED] TR25OC16.222

xCH4 = 7.78 [mu]mol/mol

    (2) For a GC-FID or FTIR, xCH4 is the actual dry-to-wet 
corrected CH4 concentration as measured by the analyzer.
    (e) C2H6 determination. For a GC-FID or FTIR, xC2H6 is 
the C1-equivalent, dry-to-wet corrected 
C2H6 concentration as measured by the analyzer.

0
270. Section 1065.665 is amended by revising paragraphs (a) and (b) to 
read as follows:


Sec.  1065.665  THCE and NMHCE determination.

    (a) If you measured an oxygenated hydrocarbon's mass concentration, 
first calculate its molar concentration in the exhaust sample stream 
from which the sample was taken (raw or diluted exhaust), and convert 
this into a C1-equivalent molar concentration. Add these 
C1-equivalent molar concentrations to the molar 
concentration of non-oxygenated total hydrocarbon (NOTHC). The result 
is the molar concentration of total hydrocarbon equivalent (THCE). 
Calculate THCE concentration using the following equations, noting that 
Eq. 1065.665-3 is required only if you need to convert your oxygenated 
hydrocarbon (OHC) concentration from mass to moles:
[GRAPHIC] [TIFF OMITTED] TR25OC16.223

[GRAPHIC] [TIFF OMITTED] TR25OC16.224


[[Page 74188]]


[GRAPHIC] [TIFF OMITTED] TR25OC16.225

Where:

xTHCE = the sum of the C1-equivalent 
concentrations of non-oxygenated hydrocarbon, alcohols, and 
aldehydes.
xNOTHC = the sum of the C1-equivalent 
concentrations of NOTHC.
xOHCi = the C1-equivalent concentration of 
oxygenated species i in diluted exhaust, not corrected for initial 
contamination.
xOHCi-init = the C1-equivalent concentration 
of the initial system contamination (optional) of oxygenated species 
i, dry-to-wet corrected.
xTHC[THC-FID]cor = the C1-equivalent response 
to NOTHC and all OHC in diluted exhaust, HC contamination and dry-
to-wet corrected, as measured by the THC-FID.
RFOHCi[THC-FID] = the response factor of the FID to 
species i relative to propane on a C1-equivalent basis.
C# = the mean number of carbon atoms in the particular 
compound.
Mdexh = the molar mass of diluted exhaust as determine in 
Sec.  1065.340.
mdexhOHCi = the mass of oxygenated species i in dilute 
exhaust.
MOHCi = the C1-equivalent molecular weight of 
oxygenated species i.
mdexh = the mass of diluted exhaust
ndexhOHCi = the number of moles of oxygenated species i 
in total diluted exhaust flow.
ndexh = the total diluted exhaust flow.

    (b) If we require you to determine nonmethane hydrocarbon 
equivalent (NMHCE), use the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.226

Where:

xNMHCE = the sum of the C1-equivalent 
concentrations of nonoxygenated nonmethane hydrocarbon (NONMHC), 
alcohols, and aldehydes.
RFCH4[THC-FID] = the response factor of THC-FID to 
CH4.
xCH4 = concentration of CH4, HC contamination 
(optional) and dry-to-wet corrected, as measured by the gas 
chromatograph FID.
* * * * *

0
271. Section 1065.667 is amended by revising paragraph (c) to read as 
follows:


Sec.  1065.667  Dilution air background emission correction.

* * * * *
    (c) You may determine the total flow of dilution air by subtracting 
the calculated raw exhaust molar flow as described in Sec.  1065.655(g) 
from the measured dilute exhaust flow. This may be done by totaling 
continuous calculations or by using batch results.
* * * * *

0
272. Section 1065.675 is amended by revising paragraph (d) to read as 
follows:


Sec.  1065.675  CLD quench verification calculations.

* * * * *
    (d) Calculate quench as follows:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.227
    
Where:

quench = amount of CLD quench.
xNOdry = concentration of NO upstream of a bubbler, 
according to Sec.  1065.370(e)(4).
xNOwet = measured concentration of NO downstream of a 
bubbler, according to Sec.  1065.370(e)(9).
xH2Oexp = maximum expected mole fraction of water during 
emission testing, according to paragraph (b) of this section.
xH2Omeas = measured mole fraction of water during the 
quench verification, according to Sec.  1065.370(e)(7).
xNOmeas = measured concentration of NO when NO span gas 
is blended with CO2 span gas, according to Sec.  
1065.370(d)(10).
xNOact = actual concentration of NO when NO span gas is 
blended with CO2 span gas, according to Sec.  
1065.370(d)(11) and calculated according to Eq. 1065.675-2.
xCO2exp = maximum expected concentration of 
CO2 during emission testing, according to paragraph (c) 
of this section.
xCO2act = actual concentration of CO2 when NO 
span gas is blended with CO2 span gas, according to Sec.  
1065.370(d)(9).

[[Page 74189]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.228

Where:

xNOspan = The NO span gas concentration input to the gas 
divider, according to Sec.  1065.370(d)(5).
xCO2span = the CO2 span gas concentration 
input to the gas divider, according to Sec.  1065.370(d)(4).

    Example: 
xNOdry = 1800.0 [mu]mol/mol
xNOwet = 1739.6 [mu]mol/mol
xH2Oexp = 0.030 mol/mol
xH2Omeas = 0.030 mol/mol
xNOmeas = 1515.2 [mu]mol/mol
xNOspan = 3001.6 [mu]mol/mol
xCO2exp = 3.2%
xCO2span = 6.1%
xCO2act = 2.98%
[GRAPHIC] [TIFF OMITTED] TR25OC16.229

quench = (-0.0036655-0.014020171)[middot]100% = -1.7685671%
* * * * *

0
273. Section 1065.680 is added to subpart G to read as follows:


Sec.  1065.680  Adjusting emission levels to account for infrequently 
regenerating aftertreatment devices.

    This section describes how to calculate and apply emission 
adjustment factors for engines using aftertreatment technology with 
infrequent regeneration events that may occur during testing. These 
adjustment factors are typically calculated based on measurements 
conducted for the purposes of engine certification, and then used to 
adjust the results of testing related to demonstrating compliance with 
emission standards. For this section, ``regeneration'' means an 
intended event during which emission levels change while the system 
restores aftertreatment performance. For example, exhaust gas 
temperatures may increase temporarily to remove sulfur from adsorbers 
or to oxidize accumulated particulate matter in a trap. Also, 
``infrequent'' refers to regeneration events that are expected to occur 
on average less than once over a transient or ramped-modal duty cycle, 
or on average less than once per mode in a discrete-mode test.
    (a) Apply adjustment factors based on whether there is active 
regeneration during a test segment. The test segment may be a test 
interval or a full duty cycle, as described in paragraph (b) of this 
section. For engines subject to standards over more than one duty 
cycle, you must develop adjustment factors under this section for each 
separate duty cycle. You must be able to identify active regeneration 
in a way that is readily apparent during all testing. All adjustment 
factors for regeneration are additive.
    (1) If active regeneration does not occur during a test segment, 
apply an upward adjustment factor, UAF, that will be added to the 
measured emission rate for that test segment. Use the following 
equation to calculate UAF:

[GRAPHIC] [TIFF OMITTED] TR25OC16.318

Where:

EFA[cycle] = the average emission factor over the test 
segment as determined in paragraph (a)(4) of this section.
EFL[cycle] = measured emissions over a complete test 
segment in which active regeneration does not occur.

    Example: 
EFARMC = 0.15 g/kW[middot]hr
EFLRMC = 0.11 g/kW[middot]hr
UAFRMC = 0.15 - 0.11 = 0.04 g/kW[middot]hr

    (2) If active regeneration occurs or starts to occur during a test 
segment, apply a downward adjustment factor, DAF, that will be 
subtracted from the measured emission rate for that test segment. Use 
the following equation to calculate DAF:

[[Page 74190]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.230

Where:

EFH[cycle] = measured emissions over the test segment 
from a complete regeneration event, or the average emission rate 
over multiple complete test segments with regeneration if the 
complete regeneration event lasts longer than one test segment.

    Example: 
EFARMC = 0.15 g/kW[middot]hr
EFHRMC = 0.50 g/kW[middot]hr
DAFRMC = 0.50 - 0.15 = 0.35 g/kW[middot]hr

    (3) Note that emissions for a given pollutant may be lower during 
regeneration, in which case EFL would be greater than 
EFH, and both UAF and DAF would be negative.
    (4) Calculate the average emission factor, EFA, as 
follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.231

Where:

F[cycle] = the frequency of the regeneration event during 
the test segment, expressed in terms of the fraction of equivalent 
test segments during which active regeneration occurs, as described 
in paragraph (a)(5) of this section.
    Example: 
FRMC = 0.10
EFARMC = 0.10 [middot] 0.50 + (1.00 - 0.10) [middot] 0.11 
= 0.15 g/kW[middot]hr

    (5) The frequency of regeneration, F, generally characterizes how 
often a regeneration event occurs within a series of test segments. 
Determine F using the following equation, subject to the provisions of 
paragraph (a)(6) of this section:
[GRAPHIC] [TIFF OMITTED] TR25OC16.232

Where:

ir[cycle] = the number of successive test segments 
required to complete an active regeneration, rounded up to the next 
whole number.
if[cycle] = the number of test segments from the end of 
one complete regeneration event to the start of the next active 
regeneration, without rounding.

    Example: 
irRMC = 2
ifRMC = 17.86
[GRAPHIC] [TIFF OMITTED] TR25OC16.233

    (6) Use good engineering judgment to determine ir and 
if, as follows:
    (i) For engines that are programmed to regenerate after a specific 
time interval, you may determine the duration of a regeneration event 
and the time between regeneration events based on the engine's design 
parameters. For other engines, determine these values based on 
measurements from in-use operation or from running repetitive duty 
cycles in a laboratory.
    (ii) For engines subject to standards over multiple duty cycles, 
such as for transient and steady-state testing, apply this same 
calculation to determine a value of F for each duty cycle.
    (iii) Consider an example for an engine that is designed to 
regenerate its PM filter 500 minutes after the end of the last 
regeneration event, with the regeneration event lasting 30 minutes. If 
the RMC takes 28 minutes, irRMC = 2 (30 / 28 = 1.07, which 
rounds up to 2), and ifRMC = 500 / 28 = 17.86.
    (b) Develop adjustment factors for different types of testing as 
follows:
    (1) Discrete-mode testing. Develop separate adjustment factors for 
each test mode (test interval) of a discrete-mode test. When measuring 
EFH, if a regeneration event has started but is not complete 
when you reach the end of the sampling time for a test interval, extend 
the sampling period for that test interval until the regeneration event 
is complete.
    (2) Ramped-modal and transient testing. Develop a separate set of 
adjustment factors for an entire ramped-modal cycle or transient duty 
cycle. When measuring EFH, if a regeneration event has 
started but is not complete when you reach the end of the duty cycle, 
start the next repeat test as soon as possible, allowing for the time 
needed to complete emission measurement and installation of new filters 
for PM measurement; in that case EFH is the average emission 
level for the test segments that included regeneration.
    (3) Accounting for cold-start measurements. For engines subject to 
cold-start testing requirements, incorporate cold-start operation into 
your analysis as follows:
    (i) Determine the frequency of regeneration, F, in a way that 
incorporates the impact of cold-start operation in proportion to the 
cold-start weighting factor specified in the standard-setting part. You 
may use good engineering judgment to determine the

[[Page 74191]]

effect of cold-start operation analytically.
    (ii) Treat cold-start testing and hot-start testing together as a 
single test segment for adjusting measured emission results under this 
section. Apply the adjustment factor to the composite emission result.
    (iii) You may apply the adjustment factor only to the hot-start 
test result if your aftertreatment technology does not regenerate 
during cold operation as represented by the cold-start transient duty 
cycle. If we ask for it, you must demonstrate this by engineering 
analysis or by test data.
    (c) If an engine has multiple regeneration strategies, determine 
and apply adjustment factors under this section separately for each 
type of regeneration.

0
274. Section 1065.690 is amended by revising paragraph (c) to read as 
follows:


Sec.  1065.690  Buoyancy correction for PM sample media.

* * * * *
    (c) Air density. Because a PM balance environment must be tightly 
controlled to an ambient temperature of (22 1) [deg]C and 
humidity has an insignificant effect on buoyancy correction, air 
density is primarily a function of atmospheric pressure. Therefore you 
may use nominal constant values for temperature and humidity when 
determining the air density of the balance environment in Eq. 1065.690-
2.
* * * * *

Subpart H--Engine Fluids, Test Fuels, Analytical Gases and Other 
Calibration Standards

0
275. A new Sec.  1065.735 is added to subpart H to read as follows:


Sec.  1065.735  Diesel exhaust fluid.

    (a) Use commercially available diesel exhaust fluid that represents 
the product that will be used in your in-use engines.
    (b) Diesel exhaust fluid for testing must generally conform to the 
specifications referenced in the definition of ``diesel exhaust fluid'' 
in Sec.  1065.1001. Use marine-grade diesel exhaust fluid only for 
marine engines.

0
276. Section 1065.750 is amended by adding new paragraphs (a)(3)(xii) 
and (xiii) to read as follows:


Sec.  1065.750  Analytical gases.

* * * * *
    (a) * * *
    (3) * * *
    (xii) CH4, C2H6, balance purified 
air and/or N2 (as applicable).
    (xiii) CH4, CH2O, 
CH2O2, C2H2, 
C2H4, C2H4O, 
C2H6, C3H8, 
C3H6, CH4O, and 
C4H10. You may omit individual gas constituents 
from this gas mixture. If your gas mixture contains oxygenated 
hydrocarbon, your gas mixture must be in balance purified 
N2, otherwise you may use balance purified air.
* * * * *

Subpart K--Definitions and Other Reference Information

0
277. Section 1065.1001 is amended as follows:
0
a. By adding definitions for ``Average'' and ``C1-
equivalent'' in alphabetical order.
0
b. By removing the definition for ``C1 equivalent (or 
basis)''.
0
c. By adding a definition for ``Diesel exhaust fluid (DEF)'' in 
alphabetical order.
0
d. By revising the definitions for ``Hydrocarbon (HC)'' and 
``Linearity''.
0
e. By adding a definition for ``Nonmethane nonethane hydrocarbon 
(NMNEHC)'' in alphabetical order.
    The added and revised definitions read as follows:


Sec.  1065.1001  Definitions.

* * * * *
    Average means the arithmetic mean of a sample.
* * * * *
    C1-equivalent means a convention of expressing HC concentrations 
based on the total number of carbon atoms present, such that the 
C1-equivalent of a molar HC concentration equals the molar 
concentration multiplied by the mean number of carbon atoms in each HC 
molecule. For example, the C1-equivalent of 10 [micro]mol/
mol of propane (C3H8) is 30 [mu]mol/mol. 
C1-equivalent molar values may be denoted as ``ppmC'' in the 
standard-setting part. Molar mass may also be expressed on a 
C1 basis. Note that calculating HC masses from molar 
concentrations and molar masses is only valid where they are each 
expressed on the same carbon basis.
* * * * *
    Diesel exhaust fluid (DEF) means a liquid reducing agent (other 
than the engine fuel) used in conjunction with selective catalytic 
reduction to reduce NOX emissions. Diesel exhaust fluid is 
generally understood to be an aqueous solution of urea conforming to 
the specifications of ISO 18611 or ISO 22241.
* * * * *
    Hydrocarbon (HC) means THC, THCE, NMHC, NMNEHC, NMOG, or NMHCE, as 
applicable. Hydrocarbon generally means the hydrocarbon group on which 
the emission standards are based for each type of fuel and engine.
* * * * *
    Linearity means the degree to which measured values agree with 
respective reference values. Linearity is quantified using a linear 
regression of pairs of measured values and reference values over a 
range of values expected or observed during testing. Perfect linearity 
would result in an intercept, a0, equal to zero, a slope, 
a1, of one, a coefficient of determination, r\2\, of one, 
and a standard error of the estimate, SEE, of zero. The term 
``linearity'' is not used in this part to refer to the shape of a 
measurement instrument's unprocessed response curve, such as a curve 
relating emission concentration to voltage output. A properly 
performing instrument with a nonlinear response curve will meet 
linearity specifications.
* * * * *
    Nonmethane nonethane hydrocarbon (NMNEHC) means the sum of all 
hydrocarbon species except methane and ethane. Refer to Sec.  1065.660 
for NMNEHC determination.
* * * * *

0
278. Section 1065.1005 is amended by revising paragraphs (a), (b), and 
(f)(2) to read as follows:


Sec.  1065.1005  Symbols, abbreviations, acronyms, and units of 
measure.

* * * * *
    (a) Symbols for quantities. This part uses the following symbols 
and units of measure for various quantities:

----------------------------------------------------------------------------------------------------------------
                                                                                           Units in terms of SI
    Symbol              Quantity                   Unit                 Unit symbol             base units
----------------------------------------------------------------------------------------------------------------
[alpha].......  atomic hydrogen-to-      mole per mole..........  mol/mol...............  1.
                 carbon ratio.
A.............  area...................  square meter...........  m\2\..................  m\2\.
a0............  intercept of least
                 squares regression.
a1............  slope of least squares
                 regression.
ag............  acceleration of Earth's  meter per square second  m/s\2\................  m[middot]s-2.
                 gravity.
[beta]........  ratio of diameters.....  meter per meter........  m/m...................  1.

[[Page 74192]]

 
[beta]........  atomic oxygen-to-carbon  mole per mole..........  mol/mol...............  1.
                 ratio.
C............  number of carbon atoms
                 in a molecule.
Cd............  discharge coefficient..
Cf............  flow coefficient.......
[delta].......  atomic nitrogen-to-      mole per mole..........  mol/mol...............  1.
                 carbon ratio.
d.............  Diameter...............  meter..................  m.....................  m.
DR............  dilution ratio.........  mole per mole..........  mol/mol...............  1.
[egr].........  error between a
                 quantity and its
                 reference.
e.............  brake-specific emission  gram per kilowatt hour.  g/(kW[middot]hr)......  g[middot]3.6[middot]10-
                 or fuel consumption.                                                      6[middot];m-
                                                                                           2[middot]kg-
                                                                                           1[middot]s\2\.
F.............  F-test statistic.......
f.............  frequency..............  hertz..................  Hz....................  s-1.
fn............  angular speed (shaft)..  revolutions per minute.  r/min.................  [pi][middot]30-
                                                                                           1[middot]s-1.
[gamma].......  ratio of specific heats  (joule per kilogram      (J/(kg[middot]K))/(J/   1.
                                          kelvin) per (joule per   (kg[middot]K)).
                                          kilogram kelvin).
[gamma].......  atomic sulfur-to-carbon  mole per mole..........  mol/mol...............  1.
                 ratio.
K.............  correction factor......  .......................  ......................  1.
Kv............  calibration coefficient  .......................  m\4\[middot];s[middot]  m\4\[middot]kg-
                                                                   K0.5/kg.                1s[middot]K0.5.
l.............  length.................  meter..................  m.....................  m.
[mu]..........  viscosity, dynamic.....  pascal second..........  Pa[middot]s...........  m-1[middot]kg[middot]s-
                                                                                           1.
M.............  molar mass \1\.........  gram per mole..........  g/mol.................  10-
                                                                                           3[middot]kg[middot]mo
                                                                                           l-1.
m.............  mass...................  kilogram...............  kg....................  kg.
m.............  mass rate..............  kilogram per second....  kg/s..................  kg[middot]s-1.
[nu]..........  viscosity, kinematic...  meter squared per        m\2\/s................  m\2\[middot]s-1.
                                          second.
N.............  total number in series.
n.............  amount of substance....  mole...................  mol...................  mol.ROW>
n.............  amount of substance      mole per second........  mol/s.................  mol[middot]s-1.
                 rate.
P.............  power..................  kilowatt...............  kW....................  10\3\[middot]m\2\[midd
                                                                                           ot]kg[middot]s-3.
PF............  penetration fraction...
p.............  pressure...............  pascal.................  Pa....................  m-1[middot]kg[middot]s-
                                                                                           2.
[rho].........  mass density...........  kilogram per cubic       kg/m\3\...............  m-3[middot]kg.
                                          meter.
[Delta]p......  differential static      pascal.................  Pa....................  m-1[middot]kg[middot]s-
                 pressure.                                                                 2.
r.............  ratio of pressures.....  pascal per pascal......  Pa/Pa.................  1.
r2............  coefficient of
                 determination.
Ra............  average surface          micrometer.............  [mu]m.................  10-6[middot]m.
                 roughness.
Re...........  Reynolds number........
RF............  response factor........
RH............  relative humidity......
[sigma].......  non-biased standard
                 deviation.
S.............  Sutherland constant....  kelvin.................  K.....................  K.
SEE...........  standard estimate of
                 error.
T.............  absolute temperature...  kelvin.................  K.....................  K.
T.............  Celsius temperature....  degree Celsius.........  [deg]C................  K--273.15.
T.............  torque (moment of        newton meter...........  N[middot]m............  m\2\[middot]kg[middot]
                 force).                                                                   s-2.
[thgr]........  plane angle............  degrees................  [deg].................  rad.
t.............  time...................  second.................  s.....................  s.
[Delta]t......  time interval, period,   second.................  s.....................  s.
                 1/frequency.
V.............  volume.................  cubic meter............  m\3\..................  m\3\.
V.............  volume rate............  cubic meter per second.  m\3\/s................  m\3\[middot]s-1.
W.............  work...................  kilowatt-hour..........  kW[middot]hr..........  3.6-
                                                                                           1[middot]10\6\[middot
                                                                                           ]m\2\[middot]kg[middo
                                                                                           t]s-2.
wC............  carbon mass fraction...  gram per gram..........  g/g...................  1.
x.............  amount of substance      mole per mole..........  mol/mol...............  1.
                 mole fraction \2\.
x.............  flow-weighted mean       mole per mole..........  mol/mol...............  1.
                 concentration.
y.............  generic variable.......
Z.............  compressibility factor.
----------------------------------------------------------------------------------------------------------------
\1\ See paragraph (f)(2) of this section for the values to use for molar masses. Note that in the cases of NOX
  and HC, the regulations specify effective molar masses based on assumed speciation rather than actual
  speciation.
\2\ Note that mole fractions for THC, THCE, NMHC, NMHCE, and NOTHC are expressed on a C1-equivalent basis.

    (b) Symbols for chemical species. This part uses the following 
symbols for chemical species and exhaust constituents:

------------------------------------------------------------------------
                Symbol                              Species
------------------------------------------------------------------------
Ar...................................  argon.
C....................................  carbon.
CH2O.................................  formaldehyde.
CH2O2................................  formic acid.
CH3OH................................  methanol.
CH4..................................  methane.
C2H4O................................  acetaldehyde.
C2H5OH...............................  ethanol.
C2H6.................................  ethane.
C3H7OH...............................  propanol.
C3H8.................................  propane.
C4H10................................  butane.
C5H12................................  pentane.
CO...................................  carbon monoxide.
CO2..................................  carbon dioxide.
H....................................  atomic hydrogen.
H2...................................  molecular hydrogen.
H2O..................................  water.
H2SO4................................  sulfuric acid.
HC...................................  hydrocarbon.
He...................................  helium.

[[Page 74193]]

 
\85\ Kr..............................  krypton 85.
N2...................................  molecular nitrogen.
NH3..................................  ammonia.
NMHC.................................  nonmethane hydrocarbon.
NMHCE................................  nonmethane hydrocarbon
                                        equivalent.
NMNEHC...............................  nonmethane-nonethane hydrocarbon.
NO...................................  nitric oxide.
NO2..................................  nitrogen dioxide.
NOX..................................  oxides of nitrogen.
N2O..................................  nitrous oxide.
NMOG.................................  nonmethane organic gases.
NONMHC...............................  non-oxygenated nonmethane
                                        hydrocarbon.
NOTHC................................  non-oxygenated total hydrocarbon.
O2...................................  molecular oxygen.
OHC..................................  oxygenated hydrocarbon.
\210\ Po.............................  polonium 210.
PM...................................  particulate matter.
S....................................  sulfur.
SVOC.................................  semi-volatile organic compound.
THC..................................  total hydrocarbon.
THCE.................................  total hydrocarbon equivalent.
ZrO2.................................  zirconium dioxide.
------------------------------------------------------------------------

* * * * *
    (f) * * *
    (2) This part uses the following molar masses or effective molar 
masses of chemical species:

------------------------------------------------------------------------
                                                        g/mol (10-
         Symbol                  Quantity        3[middot]kg[middot]mol-
                                                            1)
------------------------------------------------------------------------
Mair....................  molar mass of dry air               28.96559
                           \1\.
MAr.....................  molar mass of argon..                 39.948
MC......................  molar mass of carbon.                12.0107
MCH3OH..................  molar mass of                       32.04186
                           methanol.
MC2H5OH.................  molar mass of ethanol               46.06844
MC2H4O..................  molar mass of                       44.05256
                           acetaldehyde.
MCH4N2O.................  molar mass of urea...               60.05526
MC3H8...................  molar mass of propane               44.09562
MC3H7OH.................  molar mass of                       60.09502
                           propanol.
MCO.....................  molar mass of carbon                 28.0101
                           monoxide.
MCH4....................  molar mass of methane                16.0425
MCO2....................  molar mass of carbon                 44.0095
                           dioxide.
MH......................  molar mass of atomic                 1.00794
                           hydrogen.
MH2.....................  molar mass of                        2.01588
                           molecular hydrogen.
MH2O....................  molar mass of water..               18.01528
MCH2O...................  molar mass of                       30.02598
                           formaldehyde.
MHe.....................  molar mass of helium.               4.002602
MN......................  molar mass of atomic                 14.0067
                           nitrogen.
MN2.....................  molar mass of                        28.0134
                           molecular nitrogen.
MNH3....................  molar mass of ammonia               17.03052
MNMHC...................  effective C1 molar                 13.875389
                           mass of nonmethane
                           hydrocarbon \2\.
MNMHCE..................  effective C1 molar                 13.875389
                           mass of nonmethane
                           hydrocarbon
                           equivalent \2\.
MNMNEHC.................  effective C1 molar                 13.875389
                           mass of nonmethane-
                           nonethane
                           hydrocarbon \2\.
MNOx....................  effective molar mass                 46.0055
                           of oxides of
                           nitrogen \3\.
MN2O....................  molar mass of nitrous                44.0128
                           oxide.
MO......................  molar mass of atomic                 15.9994
                           oxygen.
MO2.....................  molar mass of                        31.9988
                           molecular oxygen.
MS......................  molar mass of sulfur.                 32.065
MTHC....................  effective C1 molar                 13.875389
                           mass of total
                           hydrocarbon \2\.
MTHCE...................  effective C1 molar                 13.875389
                           mass of total
                           hydrocarbon
                           equivalent \2\.
------------------------------------------------------------------------
\1\ See paragraph (f)(1) of this section for the composition of dry air.
\2\ The effective molar masses of THC, THCE, NMHC, NMHCE, and NMNEHC are
  defined on a C1 basis and are based on an atomic hydrogen-to-carbon
  ratio, [alpha], of 1.85 (with [beta], [gamma], and [delta] equal to
  zero).
\3\ The effective molar mass of NOX is defined by the molar mass of
  nitrogen dioxide, NO2.

* * * * *

0
279. Section 1065.1010 is amended by revising paragraphs (b) and (e) to 
read as follows:


Sec.  1065.1010  Incorporation by reference.

* * * * *
    (b) ASTM material. The following standards are available from ASTM 
International, 100 Barr Harbor Dr., P.O. Box C700, West Conshohocken, 
PA 19428-2959, (877) 909-2786, or http://www.astm.org:

    (1) ASTM D86-12, Standard Test Method for Distillation of 
Petroleum Products at Atmospheric Pressure, approved December 1, 
2012 (``ASTM D86''), IBR approved for Sec. Sec.  1065.703(b) and 
1065.710(b) and (c).
    (2) ASTM D93-13, Standard Test Methods for Flash Point by 
Pensky-Martens Closed Cup Tester, approved July 15, 2013 (``ASTM 
D93''), IBR approved for Sec.  1065.703(b).
    (3) ASTM D130-12, Standard Test Method for Corrosiveness to 
Copper from Petroleum Products by Copper Strip Test, approved 
November 1, 2012 (``ASTM D130''), IBR approved for Sec.  
1065.710(b).
    (4) ASTM D381-12, Standard Test Method for Gum Content in Fuels 
by Jet Evaporation, approved April 15, 2012 (``ASTM D381''), IBR 
approved for Sec.  1065.710(b).
    (5) ASTM D445-12, Standard Test Method for Kinematic Viscosity 
of Transparent and Opaque Liquids (and Calculation of Dynamic 
Viscosity), approved April 15, 2012 (``ASTM D445''), IBR approved 
for Sec.  1065.703(b).
    (6) ASTM D525-12a, Standard Test Method for Oxidation Stability 
of Gasoline (Induction Period Method), approved September 1, 2012 
(``ASTM D525''), IBR approved for Sec.  1065.710(b).
    (7) ASTM D613-13, Standard Test Method for Cetane Number of 
Diesel Fuel Oil, approved December 1, 2013 (``ASTM D613''), IBR 
approved for Sec.  1065.703(b).
    (8) ASTM D910-13a, Standard Specification for Aviation 
Gasolines, approved December 1, 2013 (``ASTM D910''), IBR approved 
for Sec.  1065.701(f).
    (9) ASTM D975-13a, Standard Specification for Diesel Fuel Oils, 
approved December 1, 2013 (``ASTM D975''), IBR approved for Sec.  
1065.701(f).
    (10) ASTM D1267-12, Standard Test Method for Gage Vapor Pressure 
of Liquefied Petroleum (LP) Gases (LP-Gas Method), approved November 
1, 2012 (``ASTM D1267''), IBR approved for Sec.  1065.720(a).
    (11) ASTM D1319-13, Standard Test Method for Hydrocarbon Types 
in Liquid Petroleum Products by Fluorescent Indicator Adsorption, 
approved May 1, 2013 (``ASTM D1319''), IBR approved for Sec.  
1065.710(c).

[[Page 74194]]

    (12) ASTM D1655-13a, Standard Specification for Aviation Turbine 
Fuels, approved December 1, 2013 (``ASTM D1655''), IBR approved for 
Sec.  1065.701(f).
    (13) ASTM D1837-11, Standard Test Method for Volatility of 
Liquefied Petroleum (LP) Gases, approved October 1, 2011 (``ASTM 
D1837''), IBR approved for Sec.  1065.720(a).
    (14) ASTM D1838-12a, Standard Test Method for Copper Strip 
Corrosion by Liquefied Petroleum (LP) Gases, approved December 1, 
2012 (``ASTM D1838''), IBR approved for Sec.  1065.720(a).
    (15) ASTM D1945-03 (Reapproved 2010), Standard Test Method for 
Analysis of Natural Gas by Gas Chromatography, approved January 1, 
2010 (``ASTM D1945''), IBR approved for Sec.  1065.715(a).
    (16) ASTM D2158-11, Standard Test Method for Residues in 
Liquefied Petroleum (LP) Gases, approved January 1, 2011 (``ASTM 
D2158''), IBR approved for Sec.  1065.720(a).
    (17) ASTM D2163-07, Standard Test Method for Determination of 
Hydrocarbons in Liquefied Petroleum (LP) Gases and Propane/Propene 
Mixtures by Gas Chromatography, approved December 1, 2007 (``ASTM 
D2163''), IBR approved for Sec.  1065.720(a).
    (18) ASTM D2598-12, Standard Practice for Calculation of Certain 
Physical Properties of Liquefied Petroleum (LP) Gases from 
Compositional Analysis, approved November 1, 2012 (``ASTM D2598''), 
IBR approved for Sec.  1065.720(a).
    (19) ASTM D2622-10, Standard Test Method for Sulfur in Petroleum 
Products by Wavelength Dispersive X-ray Fluorescence Spectrometry, 
approved February 15, 2010 (``ASTM D2622''), IBR approved for 
Sec. Sec.  1065.703(b) and 1065.710(b) and (c).
    (20) ASTM D2699-13b, Standard Test Method for Research Octane 
Number of Spark-Ignition Engine Fuel, approved October 1, 2013 
(``ASTM D2699''), IBR approved for Sec.  1065.710(b).
    (21) ASTM D2700-13b, Standard Test Method for Motor Octane 
Number of Spark-Ignition Engine Fuel, approved October 1, 2013 
(``ASTM D2700''), IBR approved for Sec.  1065.710(b).
    (22) ASTM D2713-13, Standard Test Method for Dryness of Propane 
(Valve Freeze Method), approved October 1, 2013 (``ASTM D2713''), 
IBR approved for Sec.  1065.720(a).
    (23) ASTM D2784-11, Standard Test Method for Sulfur in Liquefied 
Petroleum Gases (Oxy-Hydrogen Burner or Lamp), approved January 1, 
2011 (``ASTM D2784''), IBR approved for Sec.  1065.720(a).
    (24) ASTM D2880-13b, Standard Specification for Gas Turbine Fuel 
Oils, approved November 15, 2013 (``ASTM D2880''), IBR approved for 
Sec.  1065.701(f).
    (25) ASTM D2986-95a, Standard Practice for Evaluation of Air 
Assay Media by the Monodisperse DOP (Dioctyl Phthalate) Smoke Test, 
approved September 10, 1995 (``ASTM D2986''), IBR approved for Sec.  
1065.170(c). (Note: This standard was withdrawn by ASTM.)
    (26) ASTM D3231-13, Standard Test Method for Phosphorus in 
Gasoline, approved June 15, 2013 (``ASTM D3231''), IBR approved for 
Sec.  1065.710(b) and (c).
    (27) ASTM D3237-12, Standard Test Method for Lead in Gasoline By 
Atomic Absorption Spectroscopy, approved June 1, 2012 (``ASTM 
D3237''), IBR approved for Sec.  1065.710(b) and (c).
    (28) ASTM D4052-11, Standard Test Method for Density, Relative 
Density, and API Gravity of Liquids by Digital Density Meter, 
approved October 15, 2011 (``ASTM D4052''), IBR approved for Sec.  
1065.703(b).
    (29) ASTM D4629-12, Standard Test Method for Trace Nitrogen in 
Liquid Petroleum Hydrocarbons by Syringe/Inlet Oxidative Combustion 
and Chemiluminescence Detection, approved April 15, 2012 (``ASTM 
D4629''), IBR approved for Sec.  1065.655(e).
    (30) ASTM D4814-13b, Standard Specification for Automotive 
Spark-Ignition Engine Fuel, approved December 1, 2013 (``ASTM 
D4814''), IBR approved for Sec.  1065.701(f).
    (31) ASTM D4815-13, Standard Test Method for Determination of 
MTBE, ETBE, TAME, DIPE, tertiary-Amyl Alcohol and C1 to 
C4 Alcohols in Gasoline by Gas Chromatography, approved 
October 1, 2013 (``ASTM D4815''), IBR approved for Sec.  
1065.710(b).
    (32) ASTM D5186-03 (Reapproved 2009), Standard Test Method for 
Determination of the Aromatic Content and Polynuclear Aromatic 
Content of Diesel Fuels and Aviation Turbine Fuels By Supercritical 
Fluid Chromatography, approved April 15, 2009 (``ASTM D5186''), IBR 
approved for Sec.  1065.703(b).
    (33) ASTM D5191-13, Standard Test Method for Vapor Pressure of 
Petroleum Products (Mini Method), approved December 1, 2013 (``ASTM 
D5191''), IBR approved for Sec.  1065.710(b) and (c).
    (34) ASTM D5291-10, Standard Test Methods for Instrumental 
Determination of Carbon, Hydrogen, and Nitrogen in Petroleum 
Products and Lubricants, approved May 1, 2010 (``ASTM D5291''), IBR 
approved for Sec.  1065.655(e).
    (35) ASTM D5453-12, Standard Test Method for Determination of 
Total Sulfur in Light Hydrocarbons, Spark Ignition Engine Fuel, 
Diesel Engine Fuel, and Engine Oil by Ultraviolet Fluorescence, 
approved November 1, 2012 (``ASTM D5453''), IBR approved for Sec.  
1065.710(b).
    (36) ASTM D5599-00 (Reapproved 2010), Standard Test Method for 
Determination of Oxygenates in Gasoline by Gas Chromatography and 
Oxygen Selective Flame Ionization Detection, approved October 1, 
2010 (``ASTM D5599''), IBR approved for Sec. Sec.  1065.655(e) and 
1065.710(b).
    (37) ASTM D5762-12 Standard Test Method for Nitrogen in 
Petroleum and Petroleum Products by Boat-Inlet Chemiluminescence, 
approved April 15, 2012 (``ASTM D5762''), IBR approved for Sec.  
1065.655(e).
    (38) ASTM D5769-10, Standard Test Method for Determination of 
Benzene, Toluene, and Total Aromatics in Finished Gasolines by Gas 
Chromatography/Mass Spectrometry, approved May 1, 2010 (``ASTM 
D5769''), IBR approved for Sec.  1065.710(b).
    (39) ASTM D5797-13, Standard Specification for Fuel Methanol 
(M70- M85) for Automotive Spark-Ignition Engines, approved June 15, 
2013 (``ASTM D5797''), IBR approved for Sec.  1065.701(f).
    (40) ASTM D5798-13a, Standard Specification for Ethanol Fuel 
Blends for Flexible Fuel Automotive Spark-Ignition Engines, approved 
June 15, 2013 (``ASTM D5798''), IBR approved for Sec.  1065.701(f).
    (41) ASTM D6348-12 [egr]1, Standard Test Method for 
Determination of Gaseous Compounds by Extractive Direct Interface 
Fourier Transform Infrared (FTIR) Spectroscopy, approved February 1, 
2012 (``ASTM D6348''), IBR approved for Sec. Sec.  1065.266(b) and 
1065.275(b).
    (42) ASTM D6550-10, Standard Test Method for Determination of 
Olefin Content of Gasolines by Supercritical-Fluid Chromatography, 
approved October 1, 2010 (``ASTM D6550''), IBR approved for Sec.  
1065.710(b).
    (43) ASTM D6615-11a, Standard Specification for Jet B Wide-Cut 
Aviation Turbine Fuel, approved October 1, 2011 (``ASTM D6615''), 
IBR approved for Sec.  1065.701(f).
    (44) ASTM D6751-12, Standard Specification for Biodiesel Fuel 
Blend Stock (B100) for Middle Distillate Fuels, approved August 1, 
2012 (``ASTM D6751''), IBR approved for Sec.  1065.701(f).
    (45) ASTM D6985-04a, Standard Specification for Middle 
Distillate Fuel Oil--Military Marine Applications, approved November 
1, 2004 (``ASTM D6985''), IBR approved for Sec.  1065.701(f). (Note: 
This standard was withdrawn by ASTM.)
    (46) ASTM D7039-13, Standard Test Method for Sulfur in Gasoline, 
Diesel Fuel, Jet Fuel, Kerosine, Biodiesel, Biodiesel Blends, and 
Gasoline-Ethanol Blends by Monochromatic Wavelength Dispersive X-ray 
Fluorescence Spectrometry, approved September 15, 2013 (``ASTM 
D7039''), IBR approved for Sec.  1065.710(b).
    (47) ASTM F1471-09, Standard Test Method for Air Cleaning 
Performance of a High- Efficiency Particulate Air Filter System, 
approved March 1, 2009 (``ASTM F1471''), IBR approved for Sec.  
1065.1001.
* * * * *
    (e) ISO material. The following standards are available from the 
International Organization for Standardization, 1, ch. de la Voie-
Creuse, CP 56, CH-1211 Geneva 20, Switzerland, 41-22-749-01-11, or 
http://www.iso.org:

    (1) ISO 2719:2002, Determination of flash point--Pensky-Martens 
closed cup method (``ISO 2719''), IBR approved for Sec.  
1065.705(c).
    (2) ISO 3016:1994, Petroleum products--Determination of pour 
point (``ISO 3016''), IBR approved for Sec.  1065.705(c).
    (3) ISO 3104:1994/Cor 1:1997, Petroleum products--Transparent 
and opaque liquids--Determination of kinematic viscosity and 
calculation of dynamic viscosity (``ISO 3104''), IBR approved for 
Sec.  1065.705(c).
    (4) ISO 3675:1998, Crude petroleum and liquid petroleum 
products--Laboratory determination of density--Hydrometer method 
(``ISO 3675''), IBR approved for Sec.  1065.705(c).

[[Page 74195]]

    (5) ISO 3733:1999, Petroleum products and bituminous materials--
Determination of water--Distillation method (``ISO 3733''), IBR 
approved for Sec.  1065.705(c).
    (6) ISO 6245:2001, Petroleum products--Determination of ash 
(``ISO 6245''), IBR approved for Sec.  1065.705(c).
    (7) ISO 8217:2012(E), Petroleum products--Fuels (class F)--
Specifications of marine fuels, Fifth edition, August 15, 2012 
(``ISO 8217''), IBR approved for Sec.  1065.705(b) and (c).
    (8) ISO 8754:2003, Petroleum products--Determination of sulfur 
content--Energy-dispersive X-ray Fluorescence spectrometry (``ISO 
8754''), IBR approved for Sec.  1065.705(c).
    (9) ISO 10307-2(E):2009, Petroleum products--Total sediment in 
residual fuel oils--Part 2: Determination using standard procedures 
for ageing, Second Ed., February 1, 2009 (``ISO 10307''), as 
modified by ISO 10307-2:2009/Cor.1:2010(E), Technical Corrigendum 1, 
published May 15, 2010, IBR approved for Sec.  1065.705(c).
    (10) ISO 10370:1993/Cor 1:1996, Petroleum products--
Determination of carbon residue--Micro method (``ISO 10370''), IBR 
approved for Sec.  1065.705(c).
    (11) ISO 10478:1994, Petroleum products--Determination of 
aluminium and silicon in fuel oils--Inductively coupled plasma 
emission and atomic absorption spectroscopy methods (``ISO 10478''), 
IBR approved for Sec.  1065.705(c).
    (12) ISO 12185:1996/Cor 1:2001, Crude petroleum and petroleum 
products--Determination of density--Oscillating U-tube method (``ISO 
12185''), IBR approved for Sec.  1065.705(c).
    (13) ISO 14596:2007, Petroleum products--Determination of sulfur 
content--Wavelength-dispersive X-ray fluorescence spectrometry 
(``ISO 14596''), IBR approved for Sec.  1065.705(c).
    (14) ISO 14597:1997, Petroleum products--Determination of 
vanadium and nickel content--Wavelength dispersive X-ray 
fluorescence spectrometry (``ISO 14597''), IBR approved for Sec.  
1065.705(c).
    (15) ISO 14644-1:1999, Cleanrooms and associated controlled 
environments (``ISO 14644''), IBR approved for Sec.  1065.190(b).
* * * * *

Subpart L--Methods for Unregulated and Special Pollutants

0
280. Section 1065.1105 is amended by revising paragraphs (a) and (c)(4) 
to read as follows:


Sec.  1065.1105  Sampling system design.

    (a) General. We recommend that you design your SVOC batch sampler 
to extract sample from undiluted emissions to maximize the sampled SVOC 
quantity. If you dilute your sample, we recommend using annular 
dilution. If you dilute your sample, but do not use annular dilution, 
you must precondition your sampling system to reach equilibrium with 
respect to loss and re-entrainment of SVOCs to the walls of the 
sampling system. To the extent practical, adjust sampling times based 
on the emission rate of target analytes from the engine to obtain 
analyte concentrations above the detection limit. In some instances you 
may need to run repeat test cycles without replacing the sample media 
or disassembling the batch sampler.
* * * * *
    (c) * * *
    (4) Use a hydrophobic sorbent in a sealed sorbent module. Note that 
this sorbent module is intended to be the final stage for collecting 
the SVOC sample and should be sized accordingly. We recommend sizing 
the module to hold 40 g of XAD-2 along with PUF plugs at either end of 
the module, noting that you may vary the mass of XAD used for testing 
based on the anticipated SVOC emission concentration and sample flow 
rate.
* * * * *

0
281. Section 1065.1107 is amended by revising paragraphs (a)(1), 
(a)(2), and (b) introductory text to read as follows:


Sec.  1065.1107  Sample media and sample system preparation; sample 
system assembly.

* * * * *
    (a) * * *
    (1) For capturing PM, we recommend using pure quartz filters with 
no binder if you are not analyzing separately for SVOCs in gas and 
particle phases. If you are analyzing separately, you must use 
polytetrafluoroethylene (PTFE) filters with PTFE support. Select the 
filter diameter to minimize filter change intervals, accounting for the 
expected PM emission rate, sample flow rate. Note that when repeating 
test cycles to increase sample mass, you may replace the filter without 
replacing the sorbent or otherwise disassembling the batch sampler. In 
those cases, include all filters in the extraction.
    (2) For capturing gaseous SVOCs, utilize XAD-2 resin with or 
without PUF plugs. Note that two PUF plugs are typically used to 
contain the XAD-2 resin in the sorbent module.
    (b) Sample media and sampler preparation. Prepare pre-cleaned PM 
filters and pre-cleaned PUF plugs/XAD-2 as needed. Store sample media 
in containers protected from light and ambient air if you do not use 
them immediately after cleaning. Use the following preparation 
procedure, or an analogous procedure with different solvents and 
extraction times:
* * * * *

0
282. Section 1065.1109 is amended by revising paragraphs (a)(1) and 
(b)(4) introductory text to read as follows:


Sec.  1065.1109  Post-test sampler disassembly and sample extraction.

* * * * *
    (a) * * *
    (1) Remove the PM filter, PUF plugs, and all the XAD-2 from the 
sampling system and store them at or below 5 [deg]C until analysis.
* * * * *
    (b) * * *
    (4) After completing the initial extraction, remove the solvent and 
concentrate it to (4.0 0.5) ml using a Kuderna-Danish 
concentrator that includes a condenser such as a three-ball Snyder 
column with venting dimples and a graduated collection tube. Hold the 
water bath temperature at (75 to 80) [deg]C. Using this concentrator 
will minimize evaporative loss of analytes with lower molecular weight.
* * * * *

PART 1066--VEHICLE-TESTING PROCEDURES

0
283. The authority citation for part 1066 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart B-- Equipment, Measurement Instruments, Fuel, and 
Analytical Gas Specifications

0
284. Section 1066.105 is amended by revising paragraphs (c)(2) 
introductory text, (c)(2)(i), (c)(2)(iv), (c)(2)(v), (c)(5)(i), 
(c)(5)(iii), and (d) to read as follows:


Sec.  1066.105  Ambient controls and vehicle cooling fans.

* * * * *
    (c) * * *
    (2) You may use a road-speed modulated fan system meeting the 
specifications of this paragraph (c)(2) for anything other than SC03 
and AC17 testing. Use a road-speed modulated fan that achieves a linear 
speed of cooling air at the blower outlet that is within 3.0 mi/hr (1.3 m/s) of the corresponding roll speed 
when vehicle speeds are between 5 and 30 mi/hr, and within 6.5 mi/hr (2.9 m/s) of the corresponding roll speed 
at higher vehicle speeds; however you may limit the fan's maximum 
linear speed to 70 mi/hr. We recommend that the cooling fan have a 
minimum opening of 0.2 m\2\ and a minimum width of 0.8 m.
    (i) Verify the air flow velocity for fan speeds corresponding to 
vehicle speeds of 20 and 40 mi/hr using an instrument that has an 
accuracy of 2% of the measured air flow speed.
* * * * *
    (iv) Verify that the uniformity of the fan's axial flow is constant 
across the discharge area within a tolerance of 4.0

[[Page 74196]]

mi/hr of the vehicle's speed at fan speeds corresponding to 20 mi/hr, 
and within 8.0 mi/hr at fan speeds corresponding to 40 mi/
hr. For example, at a vehicle speed of 20.2 mi/hr, axial flow at all 
locations denoted by the ``+'' across the discharge nozzle must be 
between 16.2 and 24.2 mi/hr. When measuring the axial air flow 
velocity, use good engineering judgment to determine the distance from 
the nozzle outlet at each point of the fan outlet grid. Use these 
values to calculate a mean air flow velocity across the discharge area 
at each speed setting. The instrument used to verify the air velocity 
must have an accuracy of 2% of the measured air flow 
velocity.
    (v) Use a multi-axis flow meter or another method to verify that 
the fan's air flow perpendicular to the axial air flow is less than 15% 
of the axial air flow, consistent with good engineering judgment. 
Demonstrate this by comparing the perpendicular air flow velocity to 
the mean air flow velocities determined in paragraph (c)(2)(iv) of this 
section at vehicle speeds of 20 and 40 mi/hr.
* * * * *
    (5) * * *
    (i) Air flow volumes must be proportional to vehicle speed. Select 
a fan size that will produce a flow volume of approximately 45 m\3\/s 
at 60 mi/hr. If this fan is also the only source of test cell air 
circulation or if fan operational mechanics make the 0 mi/hr air flow 
requirement impractical, air flow of 2 mi/hr or less at 0 mi/hr vehicle 
speed is allowed.
* * * * *
    (iii) Use a multi-axis flow meter or another method to verify that 
the fan's air flow perpendicular to the axial air flow is less than 10% 
of the axial air flow, consistent with good engineering judgment. 
Demonstrate this by comparing the perpendicular air flow velocity to 
the mean air flow velocities determined in paragraph (c)(2)(iv) of this 
section at vehicle speeds of 20 and 40 mi/hr.
* * * * *
    (d) Allowable cooling fans for vehicles above 14,000 pounds GVWR. 
For all testing, use a road-speed modulated fan system that achieves a 
linear speed of cooling air at the blower outlet that is within 3.0 mi/hr (1.3 m/s) of the corresponding roll speed 
when vehicle speeds are between 5 and 30 mi/hr, and within 10 mi/hr (4.5 m/s) of the corresponding roll speed at 
higher vehicle speeds. For vehicles above 19,500 pounds GVWR, we 
recommend that the cooling fan have a minimum opening of 2.75 m\2\, a 
minimum flow rate of 60 m\3\/s at a fan speed of 50 mi/hr, and a 
minimum speed profile in the free stream flow, across the duct that is 
15% of the target flow rate.

0
285. Section 1066.110 is amended as follows:
0
a. By revising paragraph (b)(1)(i).
0
b. By redesignating paragraphs (b)(1)(ii) through (vii) as paragraphs 
(b)(1)(iii) through (viii), respectively.
0
c. By adding a new paragraph (b)(1)(ii).
0
d. By revising newly redesignated paragraph (b)(1)(vii).
0
e. By revising paragraph (b)(2)(i)(B).
0
f. By adding paragraph (b)(2)(iii)(C).
0
g. By revising paragraph (c).
    The additions and revisions read as follows:


Sec.  1066.110  Equipment specifications for emission sampling systems.

* * * * *
    (b) * * *
    (1) * * *
    (i) Minimize lengths of laboratory exhaust tubing. You may use a 
total length of laboratory exhaust tubing up to 4 m without needing to 
heat or insulate the tubing. However, you may use a total length of 
laboratory exhaust tubing up to 10 m, or up to 15 m for samples not 
involving PM measurement, if you insulate and/or heat the tubing to 
minimize the temperature difference between the exhaust gas and the 
whole tubing wall over the course of the emission test. The laboratory 
exhaust tubing starts at the end of the vehicle's tailpipe and ends at 
the first sample point or the first dilution point. The laboratory 
exhaust tubing may include flexible sections, but we recommend that you 
limit the amount of flexible tubing to the extent practicable. For 
multiple-tailpipe configurations where the tailpipes combine into a 
single flow path for emission sampling, the start of the laboratory 
exhaust tubing may be taken at the last joint where the exhaust flow 
first becomes a single, combined flow.
    (ii) For vehicles above 14,000 pounds GVWR, you may shorten the 
tailpipe up to the outlet of the last aftertreatment device or 
silencer, whichever is furthest downstream.
* * * * *
    (vii) Electrically ground the entire exhaust system, with the 
exception of nonconductive flexible tubing, as allowed under paragraph 
(b)(1)(iv) of this section.
    (2) * * *
    (i) * * *
    (B) You may sample background PM from the dilution tunnel at any 
time before or after an emission test using the same sampling system 
used during the emission test. For this background sampling, the 
dilution tunnel blower must be turned on, the vehicle must be 
disconnected from the laboratory exhaust tubing, and the laboratory 
exhaust tubing must be capped. You may run this PM blank test in 
combination with the dilute exhaust flow verification (propane check) 
in 40 CFR 1065.341, as long as the exhaust tubing inlet to the CVS has 
a filter meeting the requirements of 40 CFR 1065.140(b)(3).
* * * * *
    (iii) * * *
    (C) You may use a higher target filter face velocity as specified 
in 40 CFR 1065.170(c)(1)(vi), up to 140 cm/s, if you need to increase 
filter loading for PM measurement.
* * * * *
    (c) The following table summarizes the requirements of paragraph 
(b)(2) of this section:

 Table 1 of Sec.   1066.110--Summary of Equipment Specifications From 40
        CFR Part 1065, Subpart B, That Apply for Chassis Testing
------------------------------------------------------------------------
                                              Applicability for chassis
       40 CFR part 1065  references            testing under this part
------------------------------------------------------------------------
40 CFR 1065.140...........................  Use all except as noted:
                                            40 CFR 1065.140(b) applies
                                             as described in this
                                             section.
                                            Use 40 CFR 1065.140(c)(6),
                                             with the additional
                                             allowance described in this
                                             section.
                                            Do not use 40 CFR
                                             1065.140(d)(2)(iv).
                                            Use 40 CFR 1065.140(e)(1) as
                                             described in this section.
                                            Do not use 40 CFR
                                             1065.140(e)(2).
40 CFR 1065.145...........................  Use all except 40 CFR
                                             1065.145(b).
40 CFR 1065.150...........................  Use all.

[[Page 74197]]

 
40 CFR 1065.170...........................  Use all except as noted:
                                            Use 40 CFR
                                             1065.170(c)(1)(vi) as
                                             described in this section.
40 CFR 1065.190...........................  Use all.
------------------------------------------------------------------------


0
286. Section 1066.135 is amended by revising paragraph (d)(1) to read 
as follows:


Sec.  1066.135  Linearity verification.

* * * * *
    (d) * * *
    (1) Raw exhaust static pressure control.
* * * * *

0
287. Section 1066.140 is amended as follows:
0
a. By revising paragraphs (e), (f)(6)(i), (f)(8), (f)(13), (g)(6)(i), 
(g)(11), (h) introductory text, (h)(6)(i), (h)(7), (h)(9), and (h)(10).
0
b. By redesignating paragraph (j) as paragraph (i).
0
c. By revising Figure 1.
    The revisions read as follows:


Sec.  1066.140  Diluted exhaust flow calibration.

* * * * *
    (e) Configuration. Calibrate the system with any upstream screens 
or other restrictions that will be used during testing and that could 
affect the flow ahead of the flow meter. You may not use any upstream 
screen or other restriction that could affect the flow ahead of the 
reference flow meter, unless the flow meter has been calibrated with 
such a restriction.
    (f) * * *
    (6) * * *
    (i) The mean flow rate of the reference flow meter, 
Viref. This may include several measurements of different 
quantities, such as reference meter pressures and temperatures, for 
calculating Viref.
* * * * *
    (8) Repeat the steps in paragraphs (f)(6) and (7) of this section 
to record data at a minimum of six restrictor positions ranging from 
the wide-open restrictor position to the minimum expected pressure at 
the PDP inlet or the maximum expected differential (outlet minus inlet) 
pressure across the PDP during testing.
* * * * *
    (13) During emission testing ensure that the PDP is not operated 
either below the lowest inlet pressure point or above the highest 
differential pressure point in the calibration data.
    (g) * * *
    (6) * * *
    (i) The mean flow rate of the reference flow meter, 
Viref. This may include several measurements of different 
quantities for calculating Viref, such as reference meter 
pressures and temperatures.
* * * * *
    (11) Use the SSV only between the minimum and maximum calibrated 
Re#. If you want to use the SSV at a lower or higher 
Re#, you must recalibrate the SSV.
* * * * *
    (h) CFV calibration. The calibration procedure described in this 
paragraph (h) establishes the value of the calibration coefficient, 
Kv, at measured values of pressure, temperature and air 
flow. Calibrate the CFV up to the highest expected pressure ratio, r, 
according to Sec.  1066.625. Calibrate the CFV as follows:
    (6) * * *
    (i) The mean flow rate of the reference flow meter, 
Viref. This may include several measurements of different 
quantities, such as reference meter pressures and temperatures, for 
calculating Viref.
* * * * *
    (7) Incrementally close the restrictor valve or decrease the 
downstream pressure to decrease the differential pressure across the 
CFV, [Delta]pCFV.
* * * * *
    (9) Determine Kv and the highest allowable pressure 
ratio, r, according to Sec.  1066.625.
    (10) Use Kv to determine CFV flow during an emission 
test. Do not use the CFV above the highest allowed r, as determined in 
Sec.  1066.625.
* * * * *

[[Page 74198]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.234

Subpart C--Dynamometer Specifications

0
288. Section 1066.210 is amended by revising paragraph (d)(3) to read 
as follows:


Sec.  1066.210  Dynamometers.

* * * * *
    (d) * * *
    (3) The load applied by the dynamometer simulates forces acting on 
the vehicle during normal driving according to the following equation:

[[Page 74199]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.235

Where:

FR = total road-load force to be applied at the surface of the roll. 
The total force is the sum of the individual tractive forces applied 
at each roll surface.
i = a counter to indicate a point in time over the driving schedule. 
For a dynamometer operating at 10 Hz intervals over a 600 second 
driving schedule, the maximum value of i should be 6,000.
A = a vehicle-specific constant value representing the vehicle's 
frictional load in lbf or newtons. See subpart D of this part.
Gi = instantaneous road grade, in percent. If your duty 
cycle is not subject to road grade, set this value to 0.
B = a vehicle-specific coefficient representing load from drag and 
rolling resistance, which are a function of vehicle speed, in lbf/
(mi/hr) or N[middot]s/m. See subpart D of this part.
v = instantaneous linear speed at the roll surfaces as measured by 
the dynamometer, in mi/hr or m/s. Let vi-1 = 0 for i = 0.
C = a vehicle-specific coefficient representing aerodynamic effects, 
which are a function of vehicle speed squared, in lbf/(mi/hr)\2\ or 
N[middot]s\2\/m\2\. See subpart D of this part.
Me = the vehicle's effective mass in lbm or kg, including 
the effect of rotating axles as specified in Sec.  1066.310(b)(7).
t = elapsed time in the driving schedule as measured by the 
dynamometer, in seconds. Let ti-1 = 0 for i = 0.
M = the measured vehicle mass, in lbm or kg.
ag = acceleration of Earth's gravity, as described in 40 
CFR 1065.630.
* * * * *

0
289. Section 1066.235 is amended by revising paragraphs (c)(1)(i) and 
(c)(2)(i) to read as follows:


Sec.  1066.235  Speed verification procedure.

* * * * *
    (c) * * *
    (1) * * *
    (i) Set the dynamometer to speed-control mode. Set the dynamometer 
speed to a value of approximately 4.5 m/s (10 mi/hr); record the output 
of the frequency counter after 10 seconds. Determine the roll speed, 
vact, using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.236

Where:

f = frequency of the dynamometer speed sensing device, accurate to 
at least four significant figures.
droll = nominal roll diameter, accurate to the nearest 
1.0 mm, consistent with Sec.  1066.225(d).
n = the number of pulses per revolution from the dynamometer roll 
speed sensor.

    Example: 
f = 2.9231 Hz = 2.9231 s-1
droll = 904.40 mm = 0.90440 m
[GRAPHIC] [TIFF OMITTED] TR25OC16.237

vact = 8.3053 m/s
* * * * *
    (2) * * *
    (i) Set the dynamometer to speed-control mode. Set the dynamometer 
speed to a speed value of approximately 4.5 m/s (10 mi/hr). Tune the 
stroboscope or photo tachometer until the signal matches the 
dynamometer roll speed. Record the frequency. Determine the roll speed, 
yact, using Eq. 1066.235-1, using the stroboscope or photo 
tachometer's frequency for f.
* * * * *

0
290. Section 1066.245 is amended by revising paragraph (c) introductory 
text to read as follows:


Sec.  1066.245  Response time verification.

* * * * *
    (c) Procedure. Use the dynamometer's automated process to verify 
response time. You may perform this test either at two different 
inertia settings corresponding approximately to the minimum and maximum 
vehicle weights you expect to test or using base inertia and two 
acceleration rates that cover the range of acceleration rates 
experienced during testing (such as 0.5 and 8 (mi/hr)/s). Use good 
engineering judgment to select road-load coefficients representing 
vehicles of the appropriate weight. Determine the dynamometer's 
settling response time, ts, based on the point at which 
there are no measured results more than 10% above or below the final 
equilibrium value, as illustrated in Figure 1 of this section. The 
observed settling response time must be less than 100 milliseconds for 
each inertia setting. Figure 1 follows:
* * * * *

0
291. Section 1066.250 is amended by revising paragraphs (c)(1), (c)(2), 
and (c)(5) to read as follows:


Sec.  1066.250  Base inertia verification.

* * * * *
    (c) * * *
    (1) Warm up the dynamometer according to the dynamometer 
manufacturer's instructions. Set the dynamometer's road-load inertia to 
zero, turning off any electrical simulation of road load and inertia so 
that the base inertia of the dynamometer is the only inertia present. 
Motor the rolls to 5 mi/hr. Apply a constant force to accelerate the 
roll at a nominal rate of 1 (mi/hr)/s. Measure the elapsed time to 
accelerate from 10 to 40 mi/hr, noting the corresponding speed and time 
points to the nearest 0.01 mi/hr and 0.01 s. Also determine mean force 
over the measurement interval.

[[Page 74200]]

    (2) Starting from a steady roll speed of 45 mi/hr, apply a constant 
force to the roll to decelerate the roll at a nominal rate of 1 mi/hr/
s. Measure the elapsed time to decelerate from 40 to 10 mi/hr, noting 
the corresponding speed and time points to the nearest 0.01 mi/hr and 
0.01 s. Also determine mean force over the measurement interval.
* * * * *
    (5) Determine the base inertia, Ib, for each measurement 
interval using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.238

Where:

F = mean dynamometer force over the measurement interval as measured 
by the dynamometer.
vfinal = roll surface speed at the end of the measurement 
interval to the nearest 0.01 mi/hr.
vinit = roll surface speed at the start of the 
measurement interval to the nearest 0.01 mi/hr.
[Delta] t = elapsed time during the measurement interval 
to the nearest 0.01 s.

    Example: 
F = 1.500 lbf = 48.26 ft[middot]lbm/s\2\
vfinal = 40.00 mi/hr = 58.67 ft/s
vinit = 10.00 mi/hr = 14.67 ft/s
[Delta] t = 30.00 s
[GRAPHIC] [TIFF OMITTED] TR25OC16.239

Ib = 32.90 lbm
* * * * *

0
292. Section 1066.260 is amended by revising paragraphs (c)(3) and (4) 
to read as follows:


Sec.  1066.260  Parasitic friction compensation evaluation.

* * * * *
    (c) * * *
    (3) Set the dynamometer inertia to the base inertia with the road-
load coefficients A, B, and C set to 0. Set the dynamometer to speed-
control mode with a target speed of 50 mi/hr or a higher speed 
recommended by the dynamometer manufacturer. Once the speed stabilizes 
at the target speed, switch the dynamometer from speed-control to 
torque-control and allow the roll to coast for 60 seconds. Record the 
initial and final speeds and the corresponding start and stop times. If 
friction compensation is executed perfectly, there will be no change in 
speed during the measurement interval.
    (4) Calculate the power equivalent of friction compensation error, 
FCerror, using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.240

Where:

I = dynamometer inertia setting.
t = duration of the measurement interval, accurate to at least 0.01 
s.
vinit = the roll speed corresponding to the start of the 
measurement interval, accurate to at least 0.05 mi/hr.
vfinal = the roll speed corresponding to the end of the 
measurement interval, accurate to at least 0.05 mi/hr.
    Example: 
I = 2000 lbm = 62.16 lbf[middot]s\2\/ft
t = 60.0 s
vinit = 9.2 mi/hr = 13.5 ft/s
vfinal = 10.0 mi/hr = 14.7 ft/s
[GRAPHIC] [TIFF OMITTED] TR25OC16.241

FCerror = -16.5 ft[middot]lbf/s = -0.031 hp
* * * * *

0
293. Section 1066.265 is amended by revising paragraphs (c) and (d) to 
read as follows:


Sec.  1066.265  Acceleration and deceleration verification.

* * * * *
    (c) Verification of acceleration and deceleration rates. Activate 
the dynamometer's function generator for measuring roll revolution 
frequency. If the dynamometer has no such function generator, set up a 
properly calibrated external function generator consistent with the 
verification described in this paragraph (c). Use the function 
generator to determine actual acceleration and deceleration rates as 
the dynamometer traverses speeds between 10 and 40 mi/hr at various 
nominal acceleration and deceleration rates. Verify the dynamometer's 
acceleration and deceleration rates as follows:
    (1) Set up start and stop frequencies specific to your dynamometer 
by identifying the roll-revolution frequency, f, in revolutions per 
second (or Hz) corresponding to 10 mi/hr and 40 mi/hr vehicle speeds, 
accurate to at least four significant figures, using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.242

Where:

v = the target roll speed, in inches per second (corresponding to 
drive speeds of 10 mi/hr or 40 mi/hr).
n = the number of pulses from the dynamometer's roll-speed sensor 
per roll revolution.
droll = roll diameter, in inches.

    (2) Program the dynamometer to accelerate the roll at a nominal 
rate of 1 mi/hr/s from 10 mi/hr to 40 mi/hr. Measure the elapsed time 
to reach the target speed, to the nearest 0.01 s. Repeat this 
measurement for a total of five runs. Determine the actual acceleration 
rate for each run, aact, using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.243

Where:

aact = acceleration rate (decelerations have negative 
values).
vfinal = the target value for the final roll speed.
vinit = the setpoint value for the initial roll speed.
t = time to accelerate from vinit to vfinal.

    Example: 
vfinal = 40 mi/hr
vinit = 10 mi/hr
t = 30.003 s
[GRAPHIC] [TIFF OMITTED] TR25OC16.244

aact = 0.999 (mi/hr)/s

    (3) Program the dynamometer to decelerate the roll at a nominal 
rate of 1 (mi/hr)/s from 40 mi/hr to 10 mi/hr. Measure the elapsed time 
to reach the target speed, to the nearest 0.01 s. Repeat this 
measurement for a total of five runs. Determine the actual acceleration 
rate, aact, using Eq. 1066.265-2.
    (4) Repeat the steps in paragraphs (c)(2) and (3) of this section 
for additional acceleration and deceleration rates in 1 (mi/hr)/s 
increments up to and including one increment above the maximum 
acceleration rate expected during testing. Average the five repeat runs 
to calculate a mean acceleration rate, aact, at each 
setting.
    (5) Compare each mean acceleration rate, aact, to the 
corresponding nominal acceleration rate, aref, to determine 
values for acceleration error, aerror, using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.245

    Example: 

[[Page 74201]]

aact = 0.999 (mi/hr)/s
aref = 1 (mi/hr)/s
[GRAPHIC] [TIFF OMITTED] TR25OC16.246

aerror = -0.100%

    (d) Verification of forces for controlling acceleration and 
deceleration. Program the dynamometer with a calculated force value and 
determine actual acceleration and deceleration rates as the dynamometer 
traverses speeds between 10 and 40 mi/hr at various nominal 
acceleration and deceleration rates. Verify the dynamometer's ability 
to achieve certain acceleration and deceleration rates with a given 
force as follows:
    (1) Calculate the force setting, F, using the following equation:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.247
    
Where:

Ib = the dynamometer manufacturer's stated base inertia, 
in lbf[middot]s\2\/ft.
a = nominal acceleration rate, in ft/s\2\.

    Example: 
Ib = 2967 lbm = 92.217 lbf[middot]s\2\/ft
a = 1 (mi/hr)/s = 1.4667 ft/s\2\
F = 92.217 - 1.4667
F = 135.25 lbf

    (2) Set the dynamometer to road-load mode and program it with a 
calculated force to accelerate the roll at a nominal rate of 1 (mi/hr)/
s from 10 mi/hr to 40 mi/hr. Measure the elapsed time to reach the 
target speed, to the nearest 0.01 s. Repeat this measurement for a 
total of five runs. Determine the actual acceleration rate, 
aact, for each run using Eq. 1066.265-2. Repeat this step to 
determine measured ``negative acceleration'' rates using a calculated 
force to decelerate the roll at a nominal rate of 1 (mi/hr)/s from 40 
mi/hr to 10 mi/hr. Average the five repeat runs to calculate a mean 
acceleration rate, aact, at each setting.
    (3) Repeat the steps in paragraph (d)(2) of this section for 
additional acceleration and deceleration rates as specified in 
paragraph (c)(4) of this section.
    (4) Compare each mean acceleration rate, aact, to the 
corresponding nominal acceleration rate, aref, to determine 
values for acceleration error, aerror, using Eq. 1066.265-3.
* * * * *

0
294. Section 1066.270 is amended by revising paragraphs (c)(2), (c)(4), 
(c)(6) and (d)(1) to read as follows:


Sec.  1066.270  Unloaded coastdown verification.

* * * * *
    (c) * * *
    (2) With the dynamometer in coastdown mode, set the dynamometer 
inertia for the smallest vehicle weight that you expect to test and set 
A, B, and C road-load coefficients to values typical of those used 
during testing. Program the dynamometer to coast down over the 
dynamometer operational speed range (typically from a speed of 80 mi/hr 
through a minimum speed at or below 10 mi/hr). Perform at least one 
coastdown run over this speed range, collecting data over each 10 mi/hr 
interval.
* * * * *
    (4) Determine the average coastdown force, F, for each speed and 
inertia setting for each of the coastdowns performed using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.248

Where:

F = the mean force measured during the coastdown for each speed 
interval and inertia setting, expressed in lbf[middot]s\2\/ft and 
rounded to four significant figures.
I = the dynamometer's inertia setting, in lbf[middot]s\2\/ft.
vinit = the speed at the start of the coastdown interval, 
expressed in ft/s to at least four significant figures.
vfinal = the speed at the end of the coastdown interval, 
expressed in ft/s to at least four significant figures.
t = coastdown time for each speed interval and inertia setting, 
accurate to at least 0.01 s.
    Example: 
I = 2000 lbm = 62.16 lbf[middot]s\2\/ft
vinit = 25 mi/hr = 36.66 ft/s
vfinal = 15 mi/hr = 22.0 ft/s
t = 5.00 s
[GRAPHIC] [TIFF OMITTED] TR25OC16.249

F = 182.2 lbf
* * * * *
    (6) Compare the mean value of the coastdown force measured for each 
speed interval and inertia setting, Fact, to the 
corresponding Fref to determine values for coastdown force 
error, Ferror, using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.250

    Example: 
Fref = 192 lbf
Fact = 191 lbf
[GRAPHIC] [TIFF OMITTED] TR25OC16.251

Ferror = 0.5%
    (d) * * *
    (1) For vehicles at or below 20,000 pounds GVWR, the maximum 
allowable error, Ferrormax, for all speed intervals and 
inertia settings is 1.0% or the value determined from Eq. 1066.270-3, 
whichever is greater.
[GRAPHIC] [TIFF OMITTED] TR25OC16.252

    Example: 
Fref = 192 lbf
[GRAPHIC] [TIFF OMITTED] TR25OC16.253

Ferrormax = 1.14%
* * * * *

0
295. Section 1066.275 is amended by revising paragraph (c)(1) to read 
as follows:


Sec.  1066.275  Daily dynamometer readiness verification.

* * * * *
    (c) * * *
    (1) With the dynamometer in coastdown mode, set the dynamometer 
inertia to the base inertia with the road-load coefficient A set to 20 
lbf (or a force that results in a coastdown time of less than 10 
minutes) and coefficients B and C set to 0. Program the dynamometer to 
coast down for one 10 mi/hr interval from 55 mi/hr down to 45 mi/hr. If 
your dynamometer is not capable of performing one discrete coastdown, 
then coast down with preset 10 mi/hr intervals that include a 55 mi/hr 
to 45 mi/hr interval.
* * * * *

Subpart D--Coastdown

0
296. Section 1066.301 is amended by adding introductory text to read as 
follows:


Sec.  1066.301  Overview of road-load determination procedures.

    Vehicle testing on a chassis dynamometer involves simulating the 
road-load force, which is the sum of forces acting on a vehicle from 
aerodynamic drag, tire rolling resistance, driveline losses, and other 
effects of friction. Determine dynamometer settings to simulate road-

[[Page 74202]]

load force in two stages. First, perform a road-load force 
specification by characterizing on-road operation. Second, perform a 
road-load derivation to determine the appropriate dynamometer load 
settings to simulate the road-load force specification from the on-road 
test.
* * * * *

0
297. Section 1066.305 is amended by revising paragraph (a) to read as 
follows:


Sec.  1066.305  Procedures for specifying road-load forces for motor 
vehicles at or below 14,000 pounds GVWR.

    (a) For motor vehicles at or below 14,000 pounds GVWR, develop 
representative road-load coefficients to characterize each vehicle 
covered by a certificate of conformity. Calculate road-load 
coefficients by performing coastdown tests using the provisions of SAE 
J1263 and SAE J2263 (incorporated by reference in Sec.  1066.1010). 
This protocol establishes a procedure for determination of vehicle road 
load force for speeds between 115 and 15 km/hr (71.5 and 9.3 mi/hr); 
the final result is a model of road-load force (as a function of speed) 
during operation on a dry, level road under reference conditions of 20 
[deg]C, 98.21 kPa, no wind, no precipitation, and the transmission in 
neutral. You may use other methods that are equivalent to SAE J2263, 
such as equivalent test procedures or analytical modeling, to 
characterize road load using good engineering judgment. Determine 
dynamometer settings to simulate the road-load profile represented by 
these road-load target coefficients as described in Sec.  1066.315. 
Supply representative road-load forces for each vehicle at speeds above 
15 km/hr (9.3 mi/hr), and up to 115 km/hr (71.5 mi/hr), or the highest 
speed from the range of applicable duty cycles.
* * * * *

0
298. Section 1066.310 is amended by revising the introductory text and 
paragraphs (b)(1)(i), (b)(2), (b)(6), (b)(7)(ii) introductory text, 
(b)(7)(ii)(A), (b)(7)(ii)(B), (b)(7)(ii)(D), and (b)(7)(ii)(E) to read 
as follows:


Sec.  1066.310  Coastdown procedures for vehicles above 14,000 pounds 
GVWR.

    This section describes coastdown procedures that are unique to 
vehicles above 14,000 pounds GVWR. These procedures are valid for 
calculating road-load coefficients for chassis and post-transmission 
powerpack testing. These procedures are also valid for calculating drag 
area (CdA) to demonstrate compliance with Phase 1 greenhouse 
gas emission standards under 40 CFR part 1037.
* * * * *
    (b) * * *
    (1) * * *
    (i) We recommend that you do not perform coastdown testing on days 
for which winds are forecast to exceed 6.0 mi/hr.
* * * * *
    (2) Operate the vehicle at a top speed above 70 mi/hr, or at its 
maximum achievable speed if it cannot reach 70 mi/hr. If a vehicle is 
equipped with a vehicle speed limiter that is set for a maximum speed 
below 70 mi/hr, you must disable the vehicle speed limiter. Start the 
test at or above 70 mi/hr, or at the vehicle's maximum achievable speed 
if it cannot reach 70 mi/hr. Collect data through a minimum speed at or 
below 15 mi/hr. Data analysis for valid coastdown runs must include the 
range of vehicle speeds specified in this paragraph (b)(2).
* * * * *
    (6) All valid coastdown run times in each direction must be within 
2.0 standard deviations of the mean of the valid coastdown run times 
(from the specified maximum speed down to 15 mi/hr) in that direction. 
Eliminate runs outside this range. After eliminating these runs you 
must have at least eight valid runs in each direction. You may use 
coastdown run times that do not meet these standard deviation 
requirements if we approve it in advance. In your request, describe why 
the vehicle is not able to meet the specified standard deviation 
requirements and propose an alternative set of requirements.
    (7) * * *
    (ii) Determine drag area, CdA, as follows instead of 
using the procedure specified in Section 10 of SAE J1263:
    (A) Measure vehicle speed at fixed intervals over the coastdown run 
(generally at 10 Hz), including speeds at or above 15 mi/hr and at or 
below the specified maximum speed. Establish the elevation 
corresponding to each interval as described in SAE J2263 if you need to 
incorporate the effects of road grade.
    (B) Calculate the vehicle's effective mass, Me, in kg by 
adding 56.7 kg to the measured vehicle mass, M, for each tire making 
road contact. This accounts for the rotational inertia of the wheels 
and tires.
* * * * *
    (D) Plot the data from all the coastdown runs on a single plot of 
Fi vs. vi\2\ to determine the slope correlation, 
D, based on the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.254

Where:

M = the measured vehicle mass, expressed to at least the nearest 0.1 
kg.
ag = acceleration of Earth's gravity, as described in 40 
CFR 1065.630.
[Delta]h = change in elevation over the measurement interval, in m. 
Assume [Delta]h = 0 if you are not correcting for grade.
[Delta]s = distance the vehicle travels down the road during the 
measurement interval, in m.
Am = the calculated value of the y-intercept based on the 
curve-fit.

    (E) Calculate drag area, CdA, in m\2\ using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.255

Where:

[rho] = air density at reference conditions = 1.17 kg/m\3\.
[GRAPHIC] [TIFF OMITTED] TR25OC16.256

T = mean ambient absolute temperature during testing, in K.
P = mean ambient pressuring during the test, in kPa.
* * * * *

Subpart E--Preparing Vehicles and Running an Exhaust Emission Test

0
299. Section 1066.410 is amended by revising paragraphs (c) and (h) 
introductory text to read as follows:


Sec.  1066.410  Dynamometer test procedure.

* * * * *
    (c) Record the vehicle's speed trace based on the time and speed 
data from the dynamometer at the recording frequencies given in Table 1 
of Sec.  1066.125. Record speed to at least the nearest 0.01 mi/hr and 
time to at least the nearest 0.1 s.
* * * * *
    (h) Determine equivalent test weight as follows:
* * * * *

0
300. Section 1066.415 is amended by revising paragraph (e)(6)(ii) to 
read as follows:

[[Page 74203]]

Sec.  1066.415  Vehicle operation.

* * * * *
    (e) * * *
    (6) * * *
    (ii) For vehicles with manual transmission, shift gears in a way 
that represents reasonable shift patterns for in-use operation, 
considering vehicle speed, engine speed, and any other relevant 
variables. Disengage the clutch when the speed drops below 15 mi/hr, 
when engine roughness is evident, or when good engineering judgment 
indicates the engine is likely to stall. Manufacturers may recommend 
shift guidance in the owners manual that differs from the shift 
schedule used during testing, as long as both shift schedules are 
described in the application for certification; in this case, we may 
shift during testing as described in the owners manual.

0
301. Section 1066.425 is amended by revising paragraphs (b)(1), (2), 
and (3) to read as follows:


Sec.  1066.425  Performing emission tests.

* * * * *
    (b) * * *
    (1) The upper limit is 2.0 mi/hr higher than the highest point on 
the trace within 1.0 s of the given point in time.
    (2) The lower limit is 2.0 mi/hr lower than the lowest point on the 
trace within 1.0 s of the given time.
    (3) The same limits apply for vehicle operation without exhaust 
measurements, such as vehicle preconditioning and warm-up, except that 
the upper and lower limits for speed values are 4.0 mi/hr. 
In addition, up to three occurrences of speed variations greater than 
the tolerance are acceptable for vehicle operation in which no exhaust 
emission standards apply, as long as they occur for less than 15 
seconds on any occasion and are clearly documented as to the time and 
speed at that point of the driving schedule.
* * * * *

Subpart G--Calculations

0
302. Section 1066.605 is amended by revising paragraphs (c) 
introductory text and (d) through (g) and adding paragraph (h) to read 
as follows:


Sec.  1066.605  Mass-based and molar-based exhaust emission 
calculations.

* * * * *
    (c) Perform the following sequence of preliminary calculations to 
correct recorded concentration measurements before calculating mass 
emissions in paragraphs (e) and (f) of this section:
* * * * *
    (d) Calculate g/mile emission rates using the following equation 
unless the standard-setting part specifies otherwise:
[GRAPHIC] [TIFF OMITTED] TR25OC16.257

Where:

e[emission] = emission rate over the test interval.
m[emission] = emission mass over the test interval.
D = the measured driving distance over the test interval.

    Example: 
mNOx = 0.3177 g
DHFET = 10.19 miles
[GRAPHIC] [TIFF OMITTED] TR25OC16.258

    (e) Calculate the emission mass of each gaseous pollutant using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.259

Where:

m[emission] = emission mass over the test interval.
Vmix = total dilute exhaust volume over the test 
interval, corrected to standard reference conditions, and corrected 
for any volume removed for emission sampling and for any volume 
change from adding secondary dilution air.
p[emission] = density of the appropriate chemical species 
as given in Sec.  1066.1005(f).
x[emission] = measured emission concentration in the 
sample, after dry-to-wet and background corrections.
c = 10-2 for emission concentrations in %, and 
10-6 for emission concentrations in ppm.

    Example: 
Vmix = 170.878 m\3\ (from paragraph (f) of this section)
[rho]NOx = 1913 g/m\3\
xNOx = 0.9721 ppm
c = 10-6
mNOx = 
170.878[middot]1913[middot]0.9721[middot]10-6 = 0.3177 g

    (f) Calculation of the emission mass of PM, mPM, is 
dependent on how many PM filters you use, as follows:
    (1) Except as otherwise specified in this paragraph (f), calculate 
mPM using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.260

Where:

mPM = mass of particulate matter emissions over the test 
interval, as described in Sec.  1066.815(b)(1), (2), and (3).
Vmix = total dilute exhaust volume over the test 
interval, corrected to standard reference conditions, and corrected 
for any volume removed for emission sampling and for any volume 
change from adding secondary dilution air. For partial-flow dilution 
systems, set Vmix equal to the total exhaust volume over 
the test interval, corrected to standard reference conditions.
VPMstd = total volume of dilute exhaust sampled through 
the filter over the test interval, corrected to standard reference 
conditions.
Vsdastd = total volume of secondary dilution air sampled 
through the filter over the test interval, corrected to standard 
reference conditions. For partial-flow dilution systems, set 
Vsdastd equal to total dilution air volume over the test 
interval, corrected to standard reference conditions.
mPMfil = mass of particulate matter emissions on the 
filter over the test interval.
mPMbkgnd = mass of particulate matter on the background 
filter.

    Example: 
Vmix = 170.878 m\3\ (from paragraph (g) of this section)
VPMstd = 0.925 m\3\ (from paragraph (g) of this section)
Vsdastd = 0.527 m\3\ (from paragraph (g) of this section)
mPMfil = 0.0000045 g
mPMbkgnd = 0.0000014 g

[[Page 74204]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.261


    (2) If you sample PM onto a single filter as described in Sec.  
1066.815(b)(4)(i) or (b)(4)(ii) (for constant volume samplers), 
calculate mPM using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.262

Where:

mPM = mass of particulate matter emissions over the 
entire FTP.
Vmix = total dilute exhaust volume over the test 
interval, corrected to standard reference conditions, and corrected 
for any volume removed for emission sampling and for any volume 
change from adding secondary dilution air.
V[interval]-PMstd = total volume of dilute exhaust 
sampled through the filter over the test interval (ct = cold 
transient, s = stabilized, ht = hot transient), corrected to 
standard reference conditions.
V[interval]-sdastd = total volume of secondary dilution 
air sampled through the filter over the test interval (ct = cold 
transient, s = stabilized, ht = hot transient), corrected to 
standard reference conditions.
mPMfil = mass of particulate matter emissions on the 
filter over the test interval.
mPMbkgnd = mass of particulate matter on the background 
filter over the test interval.

    Example: 
Vmix = 633.691 m\3\
Vct-PMstd = 0.925 m\3\
Vct-sdastd = 0.527 m\3\
Vs-PMstd = 1.967 m\3\
Vs-sdastd = 1.121 m\3\
Vht-PMstd = 1.122 m\3\
Vht-sdastd = 0.639 m\3\
mPMfil = 0.0000106 g
mPMbkgnd = 0.0000014 g
[GRAPHIC] [TIFF OMITTED] TR25OC16.263

mPM = 0.00222 g

    (3) If you sample PM onto a single filter as described in Sec.  
1066.815(b)(4)(ii) (for partial flow dilution systems), calculate 
mPM using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.264

Where:

mPM = mass of particulate matter emissions over the 
entire FTP.
V[interval]-exhstd = total engine exhaust volume over the 
test interval (ct = cold transient, s = stabilized, ht = hot 
transient), corrected to standard reference conditions, and 
corrected for any volume removed for emission sampling.
V[interval]-PMstd = total volume of dilute exhaust 
sampled through the filter over the test interval (ct = cold 
transient, s = stabilized, ht = hot transient), corrected to 
standard reference conditions.
V[interval]-dilstd = total volume of dilution air over 
the test interval (ct = cold transient, s = stabilized, ht = hot 
transient), corrected to standard reference conditions and for any 
volume removed for emission sampling.
mPMfil = mass of particulate matter emissions on the 
filter over the test interval.
mPMbkgnd = mass of particulate matter on the background 
filter over the test interval.

    Example: 
Vct-exhstd = 5.55 m\3\
Vct-PMstd = 0.526 m\3\
Vct-dilstd = 0.481 m\3\
Vs-exhstd = 9.53 m\3\
Vs-PMstd = 0.903 m\3\
Vs-dilstd = 0.857 m\3\
Vht-exhstd = 5.54 m\3\
Vht-PMstd = 0.527 m\3\
Vht-dilstd = 0.489 m\3\
mPMfil = 0.0000106 g
mPMbkgnd = 0.0000014 g

[[Page 74205]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.265

mPM = 0.00269 g

    (4) If you sample PM onto a single filter as described in Sec.  
1066.815(b)(5)(i) or (b)(5)(ii) (for constant volume samplers), 
calculate mPM using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.266

Where:

mPM = mass of particulate matter emissions over the 
entire FTP.
Vmix = total dilute exhaust volume over the test 
interval, corrected to standard reference conditions, and corrected 
for any volume removed for emission sampling and for any volume 
change from secondary dilution air.
V[interval]-PMstd = total volume of dilute exhaust 
sampled through the filter over the test interval (ct = cold 
transient, cs = cold stabilized, ht = hot transient, hs = hot 
stabilized), corrected to standard reference conditions.
V[interval]-sdastd = total volume of secondary dilution 
air sampled through the filter over the test interval (ct = cold 
transient, cs = cold stabilized, ht = hot transient, hs = hot 
stabilized), corrected to standard reference conditions.
mPMfil = mass of particulate matter emissions on the 
filter over the test interval.
mPMbkgnd = mass of particulate matter on the background 
filter over the test interval.

    Example: 
Vmix = 972.121 m\3\
Vct-PMstd = 0.925 m\3\
Vct-sdastd = 0.529 m\3\
Vcs-PMstd = 1.968 m\3\
Vcs-sdastd = 1.123 m\3\
Vht-PMstd = 1.122 m\3\
Vht-sdastd = 0.641 m\3\
Vhs-PMstd = 1.967 m\3\
Vhs-sdastd = 1.121 m\3\
mPMfil = 0.0000229 g
mPMbkgnd = 0.0000014 g
[GRAPHIC] [TIFF OMITTED] TR25OC16.267

mPM = 0.00401 g

    (5) If you sample PM onto a single filter as described in Sec.  
1066.815(b)(5)(ii) (for partial flow dilution systems), calculate 
mPM using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.268

Where:

mPM = mass of particulate matter emissions over the 
entire FTP.
V[interval]-exhstd = total engine exhaust volume over the 
test interval (ct = cold transient, cs = cold stabilized, ht = hot 
transient, hs = hot stabilized), corrected to standard reference 
conditions, and corrected for any volume removed for emission 
sampling.
V[interval]-PMstd = total volume of dilute exhaust 
sampled through the filter over the test interval (ct = cold 
transient, cs = cold stabilized, ht = hot transient, hs = hot 
stabilized), corrected to standard reference conditions.

[[Page 74206]]

V[interval]-dilstd = total volume of dilution air over 
the test interval (ct = cold transient, cs = cold stabilized, ht = 
hot transient, hs = hot stabilized), corrected to standard reference 
conditions and for any volume removed for emission sampling.
mPMfil = mass of particulate matter emissions on the 
filter over the test interval.
mPMbkgnd = mass of particulate matter on the background 
filter over the test interval.

    Example: 
Vct-exhstd = 5.55 m\3\
Vct-PMstd = 0.526 m\3\
Vct-dilstd = 0.481 m\3\
Vcs-exhstd = 9.53 m\3\
Vcs-PMstd = 0.903 m\3\
Vcs-dilstd = 0.857 m\3\
Vht-exhstd = 5.54 m\3\
Vht-PMstd = 0.527 m\3\
Vht-dilstd = 0.489 m\3\
Vhs-exhstd = 9.54 m\3\
Vhs-PMstd = 0.902 m\3\
Vhs-dilstd = 0.856 m\3\
mPMfil = 0.0000229 g
mPMbkgnd = 0.0000014 g
[GRAPHIC] [TIFF OMITTED] TR25OC16.269

mPM = 0.00266 g

    (g) This paragraph (g) describes how to correct flow and flow rates 
to standard reference conditions and provides an example for 
determining Vmix based on CVS total flow and the removal of 
sample flow from the dilute exhaust gas. You may use predetermined 
nominal values for removed sample volumes, except for flows used for 
batch sampling.
    (1) Correct flow and flow rates to standard reference conditions as 
needed using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.270

Where:

V[flow]std = total flow volume at the flow meter, 
corrected to standard reference conditions.
V[flow]act = total flow volume at the flow meter at test 
conditions.
pin = absolute static pressure at the flow meter inlet, 
measured directly or calculated as the sum of atmospheric pressure 
plus a differential pressure referenced to atmospheric pressure.
Tstd = standard temperature.
pstd = standard pressure.
Tin = temperature of the dilute exhaust sample at the 
flow meter inlet.

    Example: 
VPMact = 1.071 m\3\
pin = 101.7 kPa
Tstd = 293.15 K
pstd = 101.325 kPa
Tin = 340.5 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.271


    (2) The following example provides a determination of 
Vmix based on CVS total flow and the removal of sample flow 
from one dilute exhaust gas analyzer and one PM sampling system that is 
utilizing secondary dilution. Note that your Vmix 
determination may vary from Eq. 1066.605-7 based on the number of flows 
that are removed from your dilute exhaust gas and whether your PM 
sampling system is using secondary dilution. For this example, 
Vmix is governed by the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.272

Where:

VCVSstd = total dilute exhaust volume over the test 
interval at the flow meter, corrected to standard reference 
conditions.
Vgasstd = total volume of sample flow through the gaseous 
emission bench over the test interval, corrected to standard 
reference conditions.
VPMstd = total volume of dilute exhaust sampled through 
the filter over the test interval, corrected to standard reference 
conditions.
Vsdastd = total volume of secondary dilution air flow 
sampled through the filter over the test interval, corrected to 
standard reference conditions.

    Example: 
    Using Eq. 1066.605-8:
VCVSstd = 170.451 m\3\, where VCVSact = 
170.721 m\3\, pin = 101.7 kPa, and Tin = 294.7 
K
    Using Eq. 1066.605-8:
Vgasstd = 0.028 m\3\, where Vgasact = 0.033 
m\3\, pin = 101.7 kPa, and Tin = 340.5 K
    Using Eq. 1066.605-8:
VPMstd = 0.925 m\3\, where VPMact = 1.071 
m\3\, pin = 101.7 kPa, and Tin = 340.5 K
    Using Eq. 1066.605-8:

[[Page 74207]]

Vsdastd = 0.527 m\3\, where Vsdaact = 0.531 
m\3\, pin = 101.7 kPa, and Tin = 296.3 K
Vmix = 170.451 + 0.028 + 0.925 - 0.527 = 170.878 m\3\

    (h) Calculate total flow volume over a test interval, 
V[flow], for a CVS or exhaust gas sampler as follows:
    (1) Varying versus constant flow rates. The calculation methods 
depend on differentiating varying and constant flow, as follows:
    (i) We consider the following to be examples of varying flows that 
require a continuous multiplication of concentration times flow rate: 
raw exhaust, exhaust diluted with a constant flow rate of dilution air, 
and CVS dilution with a CVS flow meter that does not have an upstream 
heat exchanger or electronic flow control.
    (ii) We consider the following to be examples of constant exhaust 
flows: CVS diluted exhaust with a CVS flow meter that has an upstream 
heat exchanger, an electronic flow control, or both.
    (2) Continuous sampling. For continuous sampling, you must 
frequently record a continuously updated flow signal. This recording 
requirement applies for both varying and constant flow rates.
    (i) Varying flow rate. If you continuously sample from a varying 
exhaust flow rate, calculate V[flow] using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.273

Where:


[GRAPHIC] [TIFF OMITTED] TR25OC16.319

    Example: 
N = 505
QCVS1 = 0.276 m\3\/s
QCVS2 = 0.294 m\3\/s
frecord = 1 Hz
    Using Eq. 1066.605-11,
[Delta]t = 1/1 = 1 s
VCVS = (0.276 + 0.294 + ... + 
QCVS505)[middot]1
VCVS = 170.721 m\3\

    (ii) Constant flow rate. If you continuously sample from a constant 
exhaust flow rate, use the same calculation described in paragraph 
(h)(2)(i) of this section or calculate the mean flow recorded over the 
test interval and treat the mean as a batch sample, as described in 
paragraph (h)(3)(ii) of this section.
    (3) Batch sampling. For batch sampling, calculate total flow by 
integrating a varying flow rate or by determining the mean of a 
constant flow rate, as follows:
    (i) Varying flow rate. If you proportionally collect a batch sample 
from a varying exhaust flow rate, integrate the flow rate over the test 
interval to determine the total flow from which you extracted the 
proportional sample, as described in paragraph (h)(2)(i) of this 
section.
    (ii) Constant flow rate. If you batch sample from a constant 
exhaust flow rate, extract a sample at a proportional or constant flow 
rate and calculate V[flow] from the flow from which you 
extract the sample by multiplying the mean flow rate by the time of the 
test interval using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.274

    Example: 
QiCVS = 0.338 m\3\/s
[Delta]t = 505 s
VCVS = 0.338[middot]505
VCVS = 170.69 m\3\

0
303. Section 1066.615 is amended by revising paragraph (a)(1) to read 
as follows:


Sec.  1066.615  NOX intake-air humidity correction.

* * * * *
    (a) * * *
    (1) Calculate a humidity correction using a time-weighted mean 
value for ambient humidity over the test interval. Calculate absolute 
ambient humidity, H, using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.275


[[Page 74208]]


Where:

MH2O = molar mass of H2O.
pd = saturated vapor pressure at the ambient dry bulb 
temperature.
RH = relative humidity of ambient air
Mair = molar mass of air.
patmos = atmospheric pressure.

    Example: 
MH2O = 18.01528 g/mol
pd = 2.93 kPa
RH = 37.5% = 0.375
Mair = 28.96559 g/mol
patmos = 96.71 kPa
[GRAPHIC] [TIFF OMITTED] TR25OC16.276

* * * * *

0
304. Section 1066.625 is amended by revising the introductory text and 
paragraphs (a)(1), (b) introductory text, (b)(1), (b)(2)(i), 
(b)(2)(iv)(A) and (D), (b)(2)(v), (vi), and (vii), (b)(2)(xiii), and 
(c)(1)(i), (ii), and (iii) to read as follows:


Sec.  1066.625  Flow meter calibration calculations.

    This section describes the calculations for calibrating various 
flow meters based on mass flow rates. Calibrate your flow meter 
according to 40 CFR 1065.640 instead if you calculate emissions based 
on molar flow rates.
    (a) * * *
    (1) Calculate PDP volume pumped per revolution, Vrev, 
for each restrictor position from the mean values determined in Sec.  
1066.140:
[GRAPHIC] [TIFF OMITTED] TR25OC16.277

Where:

Viref = mean flow rate of the reference flow meter.
Tin = mean temperature at the PDP inlet.
pstd = standard pressure = 101.325 kPa.
fnPDP = mean PDP speed.
Pin = mean static absolute pressure at the PDP inlet.
Tstd = standard temperature = 293.15 K.

    Example: 
Viref = 0.1651 m\3\/s
Tin = 299.5 K
pstd = 101.325 kPa
fnPDP = 1205.1 r/min = 20.085 r/s
Pin = 98.290 kPa
Tstd = 293.15 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.278

Vrev = 0.00866 m\3\/r
* * * * *
    (b) SSV calibration. The equations governing SSV flow assume one-
dimensional isentropic inviscid flow of an ideal gas. Paragraph 
(b)(2)(iv) of this section describes other assumptions that may apply. 
If good engineering judgment dictates that you account for gas 
compressibility, you may either use an appropriate equation of state to 
determine values of Z as a function of measured pressure and 
temperature, or you may develop your own calibration equations based on 
good engineering judgment. Note that the equation for the flow 
coefficient, Cf, is based on the ideal gas assumption that 
the isentropic exponent, [gamma], is equal to the ratio of specific 
heats, Cp/Cv. If good engineering judgment 
dictates using a real gas isentropic exponent, you may either use an 
appropriate equation of state to determine values of [gamma] as a 
function of measured pressure and temperature, or you may develop your 
own calibration equations based on good engineering judgment.
    (1) Calculate volume flow rate at standard reference conditions, 
Vistd, as follows
[GRAPHIC] [TIFF OMITTED] TR25OC16.279

Where:

Cd = discharge coefficient, as determined in paragraph 
(b)(2)(i) of this section.
Cf = flow coefficient, as determined in paragraph 
(b)(2)(ii) of this section.
At = cross-sectional area at the venturi throat.
R = molar gas constant.
pin = static absolute pressure at the venturi inlet.
Tstd = standard temperature.
pstd = standard pressure.
Z = compressibility factor.
Mmix = molar mass of gas mixture.
Tin = absolute temperature at the venturi inlet.

    (2) * * *
    (i) Using the data collected in Sec.  1066.140, calculate 
Cd for each flow rate using the following equation:

[[Page 74209]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.280

Where:

Viref = measured volume flow rate from the reference flow 
meter.
* * * * *
    (iv) * * *
    (A) For raw exhaust, diluted exhaust, and dilution air, you may 
assume that the gas mixture behaves as an ideal gas (Z = 1).
* * * * *
    (D) For diluted exhaust and dilution air, you may assume the molar 
mass of the mixture, Mmix, is a function only of the amount 
of water in the dilution air or calibration air, as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.281

Where:

Mair = molar mass of dry air.xH2O = amount of 
H2O in the dilution air or calibration air, determined as 
described in 40 CFR 1065.645.
MH2O = molar mass of water.

    Example: 
Mair = 28.96559 g/mol
xH2O = 0.0169 mol/mol
MH2O = 18.01528 g/mol
Mmix = 28.96559 [middot] (1 - 0.0169) + 18.01528 [middot] 
0.0169 Mmix = 28.7805 g/mol
* * * * *
    (v) The following example illustrates the use of the governing 
equations to calculate Cd of an SSV flow meter at one 
reference flow meter value:

Viref = 2.395 m\3\/s
Z = 1
Mmix = 28.7805 g/mol = 0.0287805 kg/mol
R = 8.314472 J/(mol[middot]K) = 8.314472 (m\2\[middot]kg)/
(s\2\[middot]mol[middot]K)
Tin = 298.15 K
At = 0.01824 m\2\
pin = 99.132 kPa = 99132 Pa = 99132 kg/(m[middot]s\2\)
[gamma] = 1.399
[beta] = 0.8
[Delta]p = 7.653 kPa
[GRAPHIC] [TIFF OMITTED] TR25OC16.282

Cf = 0.472
[GRAPHIC] [TIFF OMITTED] TR25OC16.283

Cd = 0.985

    (vi) Calculate the Reynolds number, Re#, for each 
reference flow rate at standard conditions, Virefstd, using 
the throat diameter of the venturi, dt, and the air density 
at standard conditions, [rho]std. Because the dynamic 
viscosity, [mu], is needed to compute Re#, you may use your 
own fluid viscosity model to determine [mu] for your calibration gas 
(usually air), using good engineering judgment. Alternatively, you may 
use the Sutherland three-coefficient viscosity model to approximate 
[mu], as shown in the following sample calculation for Re#:
[GRAPHIC] [TIFF OMITTED] TR25OC16.284


[[Page 74210]]


    Where, using the Sutherland three-coefficient viscosity model:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.285
    
Where:

[mu]0 = Sutherland reference viscosity.
T0 = Sutherland reference temperature.
S = Sutherland constant.

                                   Table 3 of Sec.   1066.625--Sutherland Three-Coefficient Viscosity Model Parameters
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                              [mu]0                    T0                      S              Temperature range      Pressure limit \2\
                                    ----------------------------------------------------------------------- within 2% ----------------------
              Gas \1\                                                                                             error \2\
                                         kg/(m[middot]s)                K                      K           -----------------------          kPa
                                                                                                                      K
--------------------------------------------------------------------------------------------------------------------------------------------------------
Air................................  1.716[middot]10-\5\...  273...................  111..................  170 to 1900..........  <=1800.
CO2................................  1.370[middot]10-\5\...  273...................  222..................  190 to 1700..........  <=3600.
H2O................................  1.12[middot]10-\5\....  350...................  1064.................  360 to 1500..........  <=10000.
O2.................................  1.919[middot]10-\5\...  273...................  139..................  190 to 2000..........  <=2500.
N2.................................  1.663[middot]10-\5\...  273...................  107..................  100 to 1500..........  <=1600.
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Use tabulated parameters only for the pure gases, as listed. Do not combine parameters in calculations to calculate viscosities of gas mixtures.
\2\ The model results are valid only for ambient conditions in the specified ranges.

    Example: 
[mu]0 = 1.716[middot]10-\5\ kg/(m[middot]s)
T0 = 273 K
S = 111 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.286

Tin = 298.15 K
dt = 152.4 mm = 0.1524 m
[rho]std = 1.1509 kg/m\3\
[GRAPHIC] [TIFF OMITTED] TR25OC16.287

Re# = 1.3027[middot]10\6\
    (vii) Calculate [rho] using the following equation:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.288
    
    Example: 
    [GRAPHIC] [TIFF OMITTED] TR25OC16.289
    

[[Page 74211]]


[rho]std = 1.1964 kg/m \3\
* * * * *
    (xiii) Once you have an equation that meets the specified 
statistical criterion, you may use the equation only for the 
corresponding range of Re\\.
* * * * *
    (c) * * *
    (1) * * *
    (i) Calculate an individual Kv for each calibration set 
point for each restrictor position using the following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.290

Where:

Virefstd= mean flow rate from the reference flow meter, 
corrected to standard reference conditions.
Tin= mean temperature at the venturi inlet.
Pin= mean static absolute pressure at the venturi inlet.
    (ii) Calculate the mean and standard deviation of all the 
Kv values (see 40 CFR 1065.602). Verify choked flow by 
plotting Kv as a function of pin. 
Kv will have a relatively constant value for choked flow; 
as vacuum pressure increases, the venturi will become unchoked and 
Kv will decrease. Paragraphs (c)(1)(iii) through (viii) 
of this section describe how to verify your range of choked flow.

    (iii) If the standard deviation of all the Kv values is 
less than or equal to 0.3% of the mean Kv, use the mean 
Kv in Eq. 1066.630-7, and use the CFV only up to the highest 
venturi pressure ratio, r, measured during calibration using the 
following equation:
[GRAPHIC] [TIFF OMITTED] TR25OC16.291

Where:

[Delta]pCFV = differential static pressure; venturi inlet 
minus venturi outlet.
pin = mean static absolute pressure at the venturi inlet.
* * * * *

0
305. Section 1066.630 is revised to read as follows:


Sec.  1066.630  PDP, SSV, and CFV flow rate calculations.

    This section describes the equations for calculating flow rates 
from various flow meters. After you calibrate a flow meter according to 
Sec.  1066.625, use the calculations described in this section to 
calculate flow during an emission test. Calculate flow according to 40 
CFR 1065.642 instead if you calculate emissions based on molar flow 
rates.
    (a) PDP. (1) Based on the speed at which you operate the PDP for a 
test interval, select the corresponding slope, a1, and 
intercept, a0, as determined in Sec.  1066.625(a), to 
calculate PDP flow rate, v, as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.292

Where:

fnPDP = pump speed.
Vrev = PDP volume pumped per revolution, as determined in 
paragraph (a)(2) of this section.
Tstd = standard temperature = 293.15 K.
pin = static absolute pressure at the PDP inlet.
Tin = absolute temperature at the PDP inlet.
pstd = standard pressure = 101.325 kPa.
    (2) Calculate Vrev using the following equation:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.293
    
    pout = static absolute pressure at the PDP outlet.

    Example: 
a1 = 0.8405 m \3\/s
fnPDP = 12.58 r/s
pout = 99.950 kPa
pin = 98.575 kPa
a0 = 0.056 m \3\/r
Tin = 323.5 K

[[Page 74212]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.294

Vrev = 0.063 m\3\/r
[GRAPHIC] [TIFF OMITTED] TR25OC16.295


    v= 0.7079 m\3\/s
    (b) SSV. Calculate SSV flow rate, v, as follows:
    [GRAPHIC] [TIFF OMITTED] TR25OC16.296
    
Where:

Cd = discharge coefficient, as determined based on the 
Cd versus Re\#\ equation in Sec.  1066.625(b)(2)(viii).
Cf = flow coefficient, as determined in Sec.  
1066.625(b)(2)(ii).
At = venturi throat cross-sectional area.
R = molar gas constant.
pin = static absolute pressure at the venturi inlet.
Tstd = standard temperature.
pstd = standard pressure.
Z = compressibility factor.
Mmix = molar mass of gas mixture.
Tin = absolute temperature at the venturi inlet.
    Example: 
Cd = 0.890
Cf = 0.472
At = 0.01824 m\2\
R = 8.314472 J/(mol[middot]K) = 8.314472 (m\2\[middot]kg)/
(s\2\[middot]mol[middot]K)
pin = 98.496 kPa
Tstd = 293.15 K
pstd = 101.325 kPa
Z = 1
Mmix = 28.7789 g/mol = 0.0287789 kg/mol
Tin = 296.85 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.297

V = 2.155 m\3\/s
    (c) CFV. If you use multiple venturis and you calibrated each 
venturi independently to determine a separate calibration coefficient, 
Kv, for each venturi, calculate the individual volume flow 
rates through each venturi and sum all their flow rates to determine 
CFV flow rate, V. If you use multiple venturis and you calibrated 
venturis in combination, calculate V using the Kv that was 
determined for that combination of venturis.
    (1) To calculate V through one venturi or a combination of 
venturis, use the mean Kv you determined in Sec.  
1066.625(c) and calculate V as follows:
[GRAPHIC] [TIFF OMITTED] TR25OC16.298

Where:

Kv = flow meter calibration coefficient.
Tin = temperature at the venturi inlet.
pin = absolute static pressure at the venturi inlet.

    Example: 
Kv = 0.074954 m\3\[middot]K\0.5\/(kPa[middot]s)
pin = 99.654 kPa
Tin = 353.15 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.299

V= 0.39748 m\3\/s
    (2) [Reserved]

0
306. Section 1066.635 is amended by revising paragraphs (a) and (c) 
introductory text to read as follows:


Sec.  1066.635  NMOG determination.

* * * * *

[[Page 74213]]

    (a) Determine NMOG by independently measuring alcohols and 
carbonyls as described in 40 CFR 1065.805 and 1065.845. Use good 
engineering judgment to determine which alcohols and carbonyls you need 
to measure. This would typically require you to measure all alcohols 
and carbonyls that you expect to contribute 1% or more of total NMOG. 
Calculate the mass of NMOG in the exhaust, mNMOG, with the 
following equation, using density values specified in Sec.  
1066.1005(f):
[GRAPHIC] [TIFF OMITTED] TR25OC16.300

Where:

mNMHC = the mass of NMHC and all oxygenated hydrocarbon 
(OHC) in the exhaust, as determined using Eq. 1066.605-2. Calculate 
NMHC mass based on [rho]NMHC.
[rho]NMHC = the effective C1-equivalent 
density of NMHC as specified in Sec.  1066.1005(f).
mOHCi = the mass of oxygenated species i in the exhaust 
calculated using Eq. 1066.605-2.
[rho]OCHi = the C1-equivalent density of 
oxygenated species i.
RFOHCi[THC-FID] = the response factor of a THC-FID to 
oxygenated species i relative to propane on a C1-
equivalent basis as determined in 40 CFR 1065.845.
* * * * *
    (c) For gasoline containing less than 25% ethanol by volume, you 
may calculate NMOG from measured NMHC emissions as follows:
* * * * *

0
307. Section 1066.695 is amended by revising paragraph (f) to read as 
follows:


Sec.  1066.695  Data requirements.

* * * * *
    (f) Vehicle information as applicable, including identification 
number, model year, applicable emission standards (including bin 
standards or family emission limits, as applicable), vehicle model, 
vehicle class, test group, durability group, engine family, 
evaporative/refueling emission family, basic engine description 
(including displacement, number of cylinders, turbocharger/supercharger 
used, and catalyst type), fuel system (type of fuel injection and fuel 
tank capacity and location), engine code, GVWR, applicable test weight, 
inertia weight class, actual curb weight at zero miles, actual road 
load at 50 mi/hr, transmission class and configuration, axle ratio, 
odometer reading, idle rpm, and measured drive wheel tire pressure.
* * * * *

Subpart H--Cold Temperature Test Procedures

0
308. Section 1066.710 is amended by revising paragraphs (a)(5) and 
(d)(3) introductory text to read as follows:


Sec.  1066.710  Cold temperature testing procedures for measuring CO 
and NMHC emissions and determining fuel economy.

* * * * *
    (a) * * *
    (5) Adjust the dynamometer to simulate vehicle operation on the 
road at -7 [deg]C as described in Sec.  1066.305(b).
* * * * *
    (d) * * *
    (3) You may start the preconditioning drive once the fuel in the 
fuel tank reaches (-12.6 to -1.4) [deg]C. Precondition the vehicle as 
follows:
* * * * *

Subpart I--Exhaust Emission Test Procedures for Motor Vehicles

0
309. Section 1066.801 is amended by revising paragraphs (c)(2) and (3) 
to read as follows:


Sec.  1066.801  Applicability and general provisions.

* * * * *
    (c) * * *
    (2) The Supplemental Federal Test Procedure (SFTP) measures the 
emission effects from aggressive driving and operation with the 
vehicle's air conditioner. The SFTP is based on a composite of three 
different test elements. In addition to the FTP, vehicles generally 
operate over the US06 and SC03 driving schedules as specified in 
paragraphs (g) and (h) of Appendix I of 40 CFR part 86, respectively. 
In the case of heavy-duty vehicles above 10,000 pounds GVWR and at or 
below 14,000 pounds GVWR, SFTP testing involves additional driving over 
the Hot LA-92 driving schedule as specified in paragraph (c) of 40 CFR 
part 86, Appendix I, instead of the US06 driving schedule. Note that 
the US06 driving schedule represents about 8.0 miles of relatively 
aggressive driving; the SC03 driving schedule represents about 3.6 
miles of urban driving with the air conditioner operating; and the hot 
portion of the LA-92 driving schedule represents about 9.8 miles of 
relatively aggressive driving for commercial trucks. See Sec.  
1066.830.
    (3) The Highway Fuel Economy Test (HFET) is specified in Appendix I 
of 40 CFR part 600. Note that the HFET represents about 10.2 miles of 
rural and freeway driving with an average speed of 48.6 mi/hr and a 
maximum speed of 60.0 mi/hr. See Sec.  1066.840.
* * * * *

0
310. Section 1066.805 is amended by revising paragraph (c) to read as 
follows:


Sec.  1066.805  Road-load power, test weight, and inertia weight class 
determination.

* * * * *
    (c) For FTP, SFTP, New York City Cycle, HFET, and LA-92 testing, 
determine road-load forces for each test vehicle at speeds between 9.3 
and 71.5 miles per hour. The road-load force must represent vehicle 
operation on a smooth, level road with no wind or calm winds, no 
precipitation, an ambient temperature of approximately 20 [deg]C, and 
atmospheric pressure of 98.21 kPa. You may extrapolate road-load force 
for speeds below 9.3 mi/hr.

0
311. Section 1066.815 is amended by revising paragraphs (b) 
introductory text and (b)(4) and (5) to read as follows:


Sec.  1066.815  Exhaust emission test procedures for FTP testing.

* * * * *
    (b) PM sampling options. Collect PM using any of the procedures 
specified in paragraphs (b)(1) through (5) of this section and use the 
corresponding equation in Sec.  1066.820 to calculate FTP composite 
emissions. Testing must meet the requirements related to filter face 
velocity as described in Sec.  1066.110(b)(2)(iii)(C), except as 
specified in paragraphs (b)(4) and (5) of this section. For procedures 
involving flow weighting, set the filter face velocity to a weighting 
target of 1.0 to meet the requirements of Sec.  1066.110(b)(2)(iii)(C). 
Allow filter face velocity to decrease as a percentage of the weighting 
factor if the weighting factor is less than 1.0 and do not change the 
nominal CVS flowrates or secondary dilution ratios between FTP or UDDS 
test intervals. Use the appropriate

[[Page 74214]]

equations in Sec.  1066.610 to show that you meet the dilution factor 
requirements of Sec.  1066.110(b)(2)(iii)(B). If you collect PM using 
the procedures specified in paragraph (b)(4) or (5) of this section, 
the residence time requirements in 40 CFR 1065.140(e)(3) apply, except 
that you may exceed an overall residence time of 5.5 s for sample flow 
rates below the highest expected sample flow rate.
* * * * *
    (4) You may collect PM on a single filter over the cold-start UDDS 
and the first 505 seconds of the hot-start UDDS using one of the 
following methods:
    (i) Adjust your sampling system flow rate over the filter to weight 
the filter face velocity over the three intervals of the FTP based on 
weighting targets of 0.43 for bag 1, 1.0 for bag 2, and 0.57 for bag 3.
    (ii) Maintain a constant sampling system flow rate over the filter 
for all three intervals of the FTP by increasing overall dilution 
ratios for bag 1 and bag 3. To do this, reduce the sample flow rate 
from the exhaust (or diluted exhaust) such that the value is reduced to 
43% and 57%, respectively, of the bag 2 values. For constant-volume 
samplers, this requires that you decrease the dilute exhaust sampling 
rate from the CVS and compensate for that by increasing the amount of 
secondary dilution air.
    (5) You may collect PM on a single filter over the cold-start UDDS 
and the full hot-start UDDS using one of the following methods:
    (i) Adjust your sampling system flow rate over the filter to weight 
the filter face velocity based on weighting targets of 0.75 for the 
cold-start UDDS and 1.0 for the hot-start UDDS.
    (ii) Maintain a constant sampling system flow rate over the filter 
for both the cold-start and hot-start UDDS by increasing the overall 
dilution ratio for the cold-start UDDS. To do this, reduce the sample 
flow rate from the exhaust (or diluted exhaust) such that the value is 
reduced to 75% of the hot-start UDDS value. For constant-volume 
samplers, this requires that you decrease the dilute exhaust sampling 
rate from the CVS and compensate for that by increasing the amount of 
secondary dilution air.
* * * * *

0
312. Section 1066.820 is amended by revising paragraph (c) to read as 
follows:


Sec.  1066.820  Composite calculations for FTP exhaust emissions.

* * * * *
    (c) Calculate the final composite PM test results as a mass-
weighted value, ePM-FTPcomp, in grams per mile as follows:
    (1) Use the following equation for PM measured as described in 
Sec.  1066.815(b)(1), (2), or (3):
[GRAPHIC] [TIFF OMITTED] TR25OC16.301


Where:

mPM-cUDDS = the combined PM mass emissions determined 
from the cold-start UDDS test interval (bag 1 and bag 2), in grams, 
as calculated using Eq. 1066.605-3.
mPM-hUDDS = the combined PM mass emissions determined 
from the hot-start UDDS test interval (bag 3 and bag 4), in grams, 
as calculated using Eq. 1066.605-3. This is the hot-stabilized 
portion from either the first or second UDDS (bag 2, unless you 
measure bag 4), in addition to the hot transient portion (bag 3).

    (2) Use the following equation for PM measured as described in 
Sec.  1066.815(b)(4):
[GRAPHIC] [TIFF OMITTED] TR25OC16.302


Where:

mPM = the combined PM mass emissions determined from the 
cold-start UDDS test interval and the first 505 seconds of the hot-
start UDDS test interval (bag 1, bag 2, and bag 3), in grams, as 
calculated using Eqs. 1066.605-4 and 1066.605-5.

    (3) Use the following equation for PM measured as described in 
Sec.  1066.815(b)(5):
[GRAPHIC] [TIFF OMITTED] TR25OC16.303


Where:

mPM = the combined PM mass emissions determined from the 
cold-start UDDS test interval and the hot-start UDDS test interval 
(bag 1, bag 2, bag 3, and bag 4), in grams, as calculated using Eqs. 
1066.605-6 and 1066.605-7.


0
313. Section 1066.835 is amended by revising paragraph (f)(3)(iv) to 
read as follows:


Sec.  1066.835  Exhaust emission test procedure for SC03 emissions.

* * * * *
    (f) * * *
    (3) * * *

[[Page 74215]]

    (iv) Check the uniformity of radiant energy intensity at least 
every 500 hours of emitter usage or every 6 months, whichever is 
sooner, and after any major modifications affecting the solar 
simulation. Determine uniformity by measuring radiant energy intensity 
using instruments that meet the specifications described in paragraph 
(f)(3)(iii) of this section at each point of a 0.5 m grid over the 
vehicle's full footprint, including the edges of the footprint, at an 
elevation 1 m above the floor. Measured values of radiant energy 
intensity must be between (722 and 978) W/m\2\ at all points.

Subpart J--Evaporative Emission Test Procedures

0
314. Section 1066.985 is amended by revising paragraph (d)(8) to read 
as follows:


Sec.  1066.985  Fuel storage system leak test procedure.

* * * * *
    (d) * * *
    (8) Use the following equation, or a different equation you develop 
based on good engineering judgment, to calculate the effective leak 
diameter, deff:
[GRAPHIC] [TIFF OMITTED] TR25OC16.304


Where:

deff = effective leak diameter, in inches, expressed to 
at least two decimal places.
QN2= volumetric flow of nitrogen, in m\3\/s.
pin = inlet pressure to orifice, in kPa.
patmos = atmospheric pressure, in kPa.
SGN2 = specific gravity of N2 relative to air 
at 101.325 kPa and 15.5 [deg]C = 0.967.
T = temperature of flowing medium, in K.

    Example: 
QN2= 0.8[middot]10-5 m\3\/s
pin = 104.294 kPa
patmos = 101.332 kPa
SGN2 = 0.967
T = 298.15 K
[GRAPHIC] [TIFF OMITTED] TR25OC16.305

    deff = 0.017 inches
* * * * *

Subpart K--Definitions and Other Reference Material

0
315. Section 1066.1005 is amended by revising paragraph (a) to read as 
follows:


Sec.  1066.1005  Symbols, abbreviations, acronyms, and units of 
measure.

* * * * *
    (a) Symbols for quantities. This part uses the following symbols 
and units of measure for various quantities:

----------------------------------------------------------------------------------------------------------------
            Symbol                 Quantity           Unit         Unit symbol    Unit in terms of SI base units
----------------------------------------------------------------------------------------------------------------
[alpha]......................  atomic hydrogen  mole per mole..  mol/mol........  1.
                                to carbon
                                ratio.
A............................  area...........  square meter...  m\2\...........  m\2\.
A............................  vehicle          pound force or   lbf or N.......  m[middot]kg[middot]s-2.
                                frictional       newton.
                                load.
ag...........................  acceleration of  meters per       m/s\2\.........  m[middot]s-2.
                                Earth's          second squared.
                                gravity.
Am...........................  calculated       pound force or   lbf or N.......  m[middot]kg[middot]s-2.
                                vehicle          newton.
                                frictional
                                load.
a0...........................  intercept of
                                least squares
                                regression.
a1...........................  slope of least
                                squares
                                regression.
a............................  acceleration...  feet per second  ft/s\2\ or m/    m[middot]s-2.
                                                 squared or       s\2\.
                                                 meters per
                                                 second squared.
B............................  vehicle load     pound force per  lbf/(mi/hr) or   kg[middot]s-1.
                                from drag and    mile per hour    N[middot]s/m.
                                rolling          or newton
                                resistance.      second per
                                                 meter.
[beta].......................  ratio of         meter per meter  m/m............  1.
                                diameters.
[beta].......................  atomic oxygen    mole per mole..  mol/mol........  1.
                                to carbon
                                ratio.
c............................  conversion
                                factor.
C............................  vehicle-         pound force per  lbf/(mi/hr)\2\   m-1[middot]kg.
                                specific         mile per hour    or
                                aerodynamic      squared or       N[middot]s\2\/
                                effects.         newton-second    m\2\.
                                                 squared per
                                                 meter squared.

[[Page 74216]]

 
C...........................  number of        C.............  number of        C.
                                carbon atoms                      carbon atoms
                                in a molecule.                    in a molecule.
Cd...........................  discharge
                                coefficient.
CdA..........................  drag area......  meter squared..  m\2\...........  m\2\.
Cf...........................  flow
                                coefficient.
Cp...........................  heat capacity    joule per        J/K............  m\2\[middot]kg[middot]s-
                                at constant      kelvin.                           2[middot]K-1.
                                pressure.
Cv...........................  heat capacity    joule per        J/K............  m\2\[middot]kg[middot]s-
                                at constant      kelvin.                           2[middot]K-1.
                                volume.
d............................  diameter.......  meters.........  m..............  m.
D............................  distance.......  miles or meters  mi or m........  m.
D............................  slope            pound force per  lbf/(mi/hr)\2\   m-2[middot]kg.
                                correlation.     mile per hour    or
                                                 squared or       N[middot]s\2\/
                                                 newton second    m\2\.
                                                 squared per
                                                 meter squared.
DF...........................  dilution factor                                    1.
e............................  mass weighted    grams/mile.....  g/mi...........
                                emission
                                result.
F............................  force..........  pound force or   lbf or N.......  kg[middot]s-2.
                                                 newton.
f............................  frequency......  hertz..........  Hz.............  s-1.
fn...........................  angular speed    revolutions per  r/min..........  [pi][middot]30[middot]s-1.
                                (shaft).         minute.
FC...........................  friction         horsepower or    W..............  m\2\[middot]kg[middot]s-3.
                                compensation     watt.
                                error.
FR...........................  road-load force  pound force or   lbf or N.......  kg[middot]s-2.
                                                 newton.
[gamma]......................  ratio of         (joule per       (J/              1.
                                specific heats.  kilogram         (kg[middot]K))/
                                                 kelvin) per      (J/
                                                 (joule per       (kg[middot]K)).
                                                 kilogram
                                                 kelvin).
[EEgr].......................  ambient          grams water      g H2O vapor/kg   g H2O vapor/kg dry air.
                                humidity.        vapor per        dry air.
                                                 kilogram dry
                                                 air.
[Delta]h.....................  change in        meters.........  m..............  m.
                                height.
I............................  inertia........  pound mass or    lbm or kg......  kg.
                                                 kilogram.
I............................  current........  ampere.........  A..............  A.
i............................  indexing
                                variable.
IR...........................  inertia work
                                rating.
K............................  correction                                         1.
                                factor.
Kv...........................  calibration                       m\4\[middot]s[m  m\4\[middot]kg-
                                coefficient.                      iddot]K\0.5\/    1[middot]s[middot]K\0.5\.
                                                                  kg.
[mu].........................  viscosity,       pascal second..  Pa[middot]s....  m-1[middot]kg[middot]s-1.
                                dynamic.
M............................  molar mass.....  gram per mole..  g/mol..........  10-3[middot]kg[middot]mol-1.
Me...........................  effective mass.  kilogram.......  kg.............  kg.
m............................  mass...........  pound mass or    lbm or kg......  kg.
                                                 kilogram.
N............................  total number in
                                series.
n............................  total number of
                                pulses in a
                                series.
p............................  pressure.......  pascal.........  Pa.............  m-1[middot]kg[middot]s-2.
[Delta]p.....................  differential     pascal.........  Pa.............  m-1[middot]kg[middot]s-2.
                                static
                                pressure.
pd...........................  saturated vapor  kilopascal.....  kPa............  m-1[middot]kg[middot]s-2.
                                pressure at
                                ambient dry
                                bulb
                                temperature.
PF...........................  penetration
                                fraction.
[rho]........................  mass density...  kilogram per     kg/m\3\........  m-3[middot]kg.
                                                 cubic meter.
R............................  dynamometer      revolutions per  rpm............  [pi][middot]30-1[middot]s-1.
                                roll             minute.
                                revolutions.
r............................  ratio of         pascal per       Pa/Pa..........  1.
                                pressures.       pascal.
r\2\.........................  coefficient of
                                determination.
Re..........................  Reynolds number
RF...........................  response factor
RH...........................  relative
                                humidity.
S............................  Sutherland       kelvin.........  K..............  K.
                                constant.
SEE..........................  standard
                                estimate of
                                error.
SG...........................  specific
                                gravity.
[Delta]s.....................  distance         meters.........  m..............  m.
                                traveled
                                during
                                measurement
                                interval.
T............................  absolute         kelvin.........  K..............  K.
                                temperature.
T............................  Celsius          degree Celsius.  [deg]C.........  K-273.15.
                                temperature.
T............................  torque (moment   newton meter...  N[middot]m.....  m\2\[middot]kg[middot]s-2.
                                of force).
t............................  time...........  hour or second.  hr or s........  s.
[Delta]t.....................  time interval,   second.........  s..............  s.
                                period, 1/
                                frequency.
U............................  voltage........  volt...........  V..............  m\2\[middot]kg[middot]s-
                                                                                   3[middot]A-1.
v............................  speed..........  miles per hour   mi/hr or m/s...  m [middot] s-1.
                                                 or meters per
                                                 second.
V............................  volume.........  cubic meter....  m\3\...........  m\3\.
V............................  flow volume      cubic feet per   ft\3\min or      m\3\ [middot] s\1\.
                                rate.            minute or        ms\3\.
                                                 cubic meter
                                                 per second.
VP...........................  volume percent.
x............................  concentration    part per         ppm............
                                of emission      million.
                                over a test
                                interval.
y............................  generic
                                variable.
Z............................  compressibility
                                factor.
----------------------------------------------------------------------------------------------------------------


[[Page 74217]]

* * * * *

0
316. Section 1066.1010 is amended by removing the undesignated 
paragraph after paragraph (a) introductory text and revising paragraph 
(b)(1) to read as follows:


Sec.  1066.1010   Incorporation by reference.

* * * * *
    (b) * * *
    (1) SAE J1263, Road Load Measurement and Dynamometer Simulation 
Using Coastdown Techniques, revised March 2010, IBR approved for 
Sec. Sec.  1066.301(b), 1066.305(a), and 1066.310(b).
* * * * *

PART 1068--GENERAL COMPLIANCE PROVISIONS FOR HIGHWAY, STATIONARY, 
AND NONROAD PROGRAMS

0
317. The authority citation for part 1068 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart A--Applicability and Miscellaneous Provisions

0
318. Section 1068.1 is revised to read as follows:


Sec.  1068.1  Does this part apply to me?

    (a) The provisions of this part apply to everyone with respect to 
the engine and equipment categories as described in this paragraph (a). 
They apply to everyone, including owners, operators, parts 
manufacturers, and persons performing maintenance. Where we identify an 
engine category, the provisions of this part also apply with respect to 
the equipment using such engines. This part 1068 applies to different 
engine and equipment categories as follows:
    (1) This part 1068 applies to motor vehicles we regulate under 40 
CFR part 86, subpart S, to the extent and in the manner specified in 40 
CFR parts 85 and 86.
    (2) This part 1068 applies for heavy-duty motor vehicles we 
regulate under 40 CFR part 1037, subject to the provisions of 40 CFR 
parts 85 and 1037. This includes trailers. This part 1068 applies to 
other heavy-duty motor vehicles and motor vehicle engines to the extent 
and in the manner specified in 40 CFR parts 85, 86, and 1036.
    (3) This part 1068 applies to highway motorcycles we regulate under 
40 CFR part 86, subparts E and F, to the extent and in the manner 
specified in 40 CFR parts 85 and 86.
    (4) This part 1068 applies to aircraft we regulate under 40 CFR 
part 87 to the extent and in the manner specified in 40 CFR part 87.
    (5) This part 1068 applies for locomotives that are subject to the 
provisions of 40 CFR part 1033. This part 1068 does not apply for 
locomotives or locomotive engines that were originally manufactured 
before July 7, 2008, and that have not been remanufactured on or after 
July 7, 2008.
    (6) This part 1068 applies for land-based nonroad compression-
ignition engines that are subject to the provisions of 40 CFR part 
1039. This part 1068 does not apply for engines certified under 40 CFR 
part 89.
    (7) This part 1068 applies for stationary compression-ignition 
engines certified using the provisions of 40 CFR parts 89, 94, 1039, 
and 1042 as described in 40 CFR part 60, subpart IIII.
    (8) This part 1068 applies for marine compression-ignition engines 
that are subject to the provisions of 40 CFR part 1042. This part 1068 
does not apply for marine compression-ignition engines certified under 
40 CFR part 94.
    (9) This part 1068 applies for marine spark-ignition engines that 
are subject to the provisions of 40 CFR part 1045. This part 1068 does 
not apply for marine spark-ignition engines certified under 40 CFR part 
91.
    (10) This part 1068 applies for large nonroad spark-ignition 
engines that are subject to the provisions of 40 CFR part 1048.
    (11) This part 1068 applies for stationary spark-ignition engines 
certified using the provisions of 40 CFR part 1048 or part 1054, as 
described in 40 CFR part 60, subpart JJJJ.
    (12) This part 1068 applies for recreational engines and vehicles, 
including snowmobiles, off-highway motorcycles, and all-terrain 
vehicles that are subject to the provisions of 40 CFR part 1051.
    (13) This part applies for small nonroad spark-ignition engines 
that are subject to the provisions of 40 CFR part 1054. This part 1068 
does not apply for nonroad spark-ignition engines certified under 40 
CFR part 90.
    (14) This part applies for fuel-system components installed in 
nonroad equipment powered by volatile liquid fuels that are subject to 
the provisions of 40 CFR part 1060.
    (b) [Reserved]
    (c) Paragraph (a) of this section identifies the parts of the CFR 
that define emission standards and other requirements for particular 
types of engines and equipment. This part 1068 refers to each of these 
other parts generically as the ``standard-setting part.'' For example, 
40 CFR part 1051 is always the standard-setting part for snowmobiles. 
Follow the provisions of the standard-setting part if they are 
different than any of the provisions in this part.
    (d) Specific provisions in this part 1068 start to apply separate 
from the schedule for certifying engines/equipment to new emission 
standards, as follows:
    (1) The provisions of Sec. Sec.  1068.30 and 1068.310 apply for 
stationary spark-ignition engines built on or after January 1, 2004, 
and for stationary compression-ignition engines built on or after 
January 1, 2006.
    (2) The provisions of Sec. Sec.  1068.30 and 1068.235 apply for the 
types of nonroad engines/equipment listed in paragraph (a) of this 
section beginning January 1, 2004, if they are used solely for 
competition.
    (3) The standard-setting part may specify how the provisions of 
this part 1068 apply for uncertified engines/equipment.

0
319. Section 1068.10 is amended by revising the section heading to read 
as follows:


Sec.  1068.10  Confidential information.

* * * * *

0
320. Section 1068.15 is amended by revising the section heading and 
paragraph (a) to read as follows:


Sec.  1068.15  General provisions for EPA decision-making.

    (a) Not all EPA employees may represent the Agency with respect to 
EPA decisions under this part or the standard-setting part. Only the 
Administrator of the Environmental Protection Agency or an official to 
whom the Administrator has delegated specific authority may represent 
the Agency. For more information, ask for a copy of the relevant 
sections of the EPA Delegations Manual from the Designated Compliance 
Officer.
* * * * *


Sec.  1068.20  [Amended]

0
321. Section 1068.20 is amended by removing paragraphs (b) and (c) and 
redesignating paragraphs (d) through (f) as paragraphs (b) through (d), 
respectively.

0
322. Section 1068.27 is revised to read as follows:


Sec.  1068.27  May EPA conduct testing with my engines/equipment?

    (a) As described in the standard-setting part, we may perform 
testing on your engines/equipment before we issue a certificate of 
conformity. This is generally known as confirmatory testing.
    (b) If we request it, you must make a reasonable number of 
production-line engines or pieces of production-line

[[Page 74218]]

equipment available for a reasonable time so we can test or inspect 
them for compliance with the requirements of this chapter.
    (c) If your emission-data engine/equipment or production engine/
equipment requires special components for proper testing, you must 
promptly provide any such components to us if we ask for them.

0
323. Section 1068.30 is revised to read as follows:


Sec.  1068.30  Definitions.

    The following definitions apply to this part. The definitions apply 
to all subparts unless we note otherwise. All undefined terms have the 
meaning the Clean Air Act gives to them. The definitions follow:
    Affiliated companies or affiliates means one of the following:
    (1) For determinations related to small manufacturer allowances or 
other small business provisions, these terms mean all entities 
considered to be affiliates with your entity under the Small Business 
Administration's regulations in 13 CFR 121.103.
    (2) For all other provisions, these terms mean all of the 
following:
    (i) Parent companies (as defined in this section).
    (ii) Subsidiaries (as defined in this section).
    (iii) Subsidiaries of your parent company.
    Aftertreatment means relating to a catalytic converter, particulate 
filter, or any other system, component, or technology mounted 
downstream of the exhaust valve (or exhaust port) whose design function 
is to reduce emissions in the engine exhaust before it is exhausted to 
the environment. Exhaust gas recirculation (EGR) is not aftertreatment.
    Aircraft means any vehicle capable of sustained air travel more 
than 100 feet above the ground.
    Certificate holder means a manufacturer (including importers) with 
a valid certificate of conformity for at least one family in a given 
model year, or the preceding model year. Note that only manufacturers 
may hold certificates. Your applying for or accepting a certificate is 
deemed to be your agreement that you are a manufacturer.
    Clean Air Act means the Clean Air Act, as amended, 42 U.S.C. 7401- 
7671q.
    Date of manufacture means one of the following:
    (1) For engines, the date on which the crankshaft is installed in 
an engine block, with the following exceptions:
    (i) For engines produced by secondary engine manufacturers under 
Sec.  1068.262, date of manufacture means the date the engine is 
received from the original engine manufacturer. You may assign an 
earlier date up to 30 days before you received the engine, but not 
before the crankshaft was installed. You may not assign an earlier date 
if you cannot demonstrate the date the crankshaft was installed.
    (ii) Manufacturers may assign a date of manufacture at a point in 
the assembly process later than the date otherwise specified under this 
definition. For example, a manufacturer may use the build date printed 
on the label or stamped on the engine as the date of manufacture.
    (2) For equipment, the date on which the engine is installed, 
unless otherwise specified in the standard-setting part. Manufacturers 
may alternatively assign a date of manufacture later in the assembly 
process.
    Days means calendar days, including weekends and holidays.
    Defeat device has the meaning given in the standard-setting part.
    Designated Compliance Officer means one of the following:
    (1) For motor vehicles regulated under 40 CFR part 86, subpart S: 
Director, Light-Duty Vehicle Center, U.S. Environmental Protection 
Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105; 
[email protected]; epa.gov/otaq/verify.
    (2) For compression-ignition engines used in heavy-duty highway 
vehicles regulated under 40 CFR part 86, subpart A, and 40 CFR parts 
1036 and 1037, and for nonroad and stationary compression-ignition 
engines or equipment regulated under 40 CFR parts 60, 1033, 1039, and 
1042: Director, Diesel Engine Compliance Center, U.S. Environmental 
Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105; 
[email protected]; epa.gov/otaq/verify.
    (3) Director, Gasoline Engine Compliance Center, U.S. Environmental 
Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105; [email protected]; epa.gov/otaq/verify, for all the following engines and 
vehicles:
    (i) For spark-ignition engines used in heavy-duty highway vehicles 
regulated under 40 CFR part 86, subpart A, and 40 CFR parts 1036 and 
1037,
    (ii) For highway motorcycles regulated under 40 CFR part 86, 
subpart E.
    (iii) For nonroad and stationary spark-ignition engines or 
equipment regulated under 40 CFR parts 60, 1045, 1048, 1051, 1054, and 
1060.
    Engine means an engine block with an installed crankshaft, or a gas 
turbine engine. The term engine does not include engine blocks without 
an installed crankshaft, nor does it include any assembly of 
reciprocating engine components that does not include the engine block. 
(Note: For purposes of this definition, any component that is the 
primary means of converting an engine's energy into usable work is 
considered a crankshaft, whether or not it is known commercially as a 
crankshaft.) This includes complete and partially complete engines as 
follows:
    (1) A complete engine is a fully assembled engine in its final 
configuration. In the case of equipment-based standards, an engine is 
not considered complete until it is installed in the equipment, even if 
the engine itself is fully assembled.
    (2) A partially complete engine is an engine that is not fully 
assembled or is not in its final configuration. Except where we specify 
otherwise in this part or the standard-setting part, partially complete 
engines are subject to the same standards and requirements as complete 
engines. The following would be considered examples of partially 
complete engines:
    (i) An engine that is missing certain emission-related components.
    (ii) A new engine that was originally assembled as a motor-vehicle 
engine that will be recalibrated for use as a nonroad engine.
    (iii) A new engine that was originally assembled as a land-based 
engine that will be modified for use as a marine propulsion engine.
    (iv) A short block consisting of a crankshaft and other engine 
components connected to the engine block, but missing the head 
assembly.
    (v) A long block consisting of all engine components except the 
fuel system and an intake manifold.
    (vi) In the case of equipment-based standards, a fully functioning 
engine that is not yet installed in the equipment. For example, a fully 
functioning engine that will be installed in an off-highway motorcycle 
or a locomotive is considered partially complete until it is installed 
in the equipment.
    Engine-based standard means an emission standard expressed in units 
of grams of pollutant per kilowatt-hour (or grams of pollutant per 
horsepower-hour) that applies to the engine. Emission standards are 
either engine-based or equipment-based. Note that engines may be 
subject to additional standards such as smoke standards.
    Engine-based test means an emission test intended to measure 
emissions in units of grams of pollutant per kilowatt-hour (or grams of 
pollutant per horsepower-hour), without regard to

[[Page 74219]]

whether the standard applies to the engine or equipment. Note that some 
products that are subject to engine-based testing are subject to 
additional test requirements such as for smoke.
    Engine configuration means a unique combination of engine hardware 
and calibration within an engine family. Engines within a single engine 
configuration differ only with respect to normal production variability 
or factors unrelated to emissions.
    Engine/equipment and engines/equipment mean engine(s) and/or 
equipment depending on the context. Specifically these terms mean the 
following:
    (1) Engine(s) when only engine-based standards apply.
    (2) Engine(s) for testing issues when engine-based testing applies.
    (3) Engine(s) and equipment when both engine-based and equipment-
based standards apply.
    (4) Equipment when only equipment-based standards apply.
    (5) Equipment for testing issues when equipment-based testing 
applies.
    Equipment means one of the following things:
    (1) Any vehicle, vessel, or other type of equipment that is subject 
to the requirements of this part or that uses an engine that is subject 
to the requirements of this part. An installed engine is part of the 
equipment. Motor vehicle trailers are a type of equipment that is 
subject to the requirements of this part.
    (2) Fuel-system components that are subject to an equipment-based 
standard under this chapter. Installed fuel-system components are also 
considered part of the engine/equipment to which they are attached.
    Equipment-based standard means an emission standard that applies to 
the equipment in which an engine is used or to fuel-system components 
associated with an engine, without regard to how the emissions are 
measured. If equipment-based standards apply, we require that the 
equipment or fuel-system components be certified rather than just the 
engine. Emission standards are either engine-based or equipment-based. 
For example, recreational vehicles we regulate under 40 CFR part 1051 
are subject to equipment-based standards even if emission measurements 
are based on engine operation alone.
    Excluded means relating to engines/equipment that are not subject 
to emission standards or other requirements because they do not meet 
the definitions or other regulatory provisions that define 
applicability. For example, a non-stationary engine that is used solely 
for off-highway competition is excluded from the requirements of this 
part because it meets neither the definition of ``motor vehicle 
engine'' nor ``nonroad engine'' under section 216 of the Clean Air Act.
    Exempted means relating to engines/equipment that are subject to 
certain standards or other requirements, but are not required to meet 
those standards or requirements, subject to one or more qualifying 
conditions. Exempted engines/equipment must conform to regulatory 
conditions specified for an exemption in this part 1068 or in the 
standard-setting part. Engines/equipment exempted with respect to a 
certain tier of standards may be required to comply with an earlier 
tier of standards as a condition of the exemption; for example, engines 
exempted with respect to Tier 3 standards may be required to comply 
with Tier 1 or Tier 2 standards.
    Family means engine family or emission family, as applicable, under 
the standard-setting part.
    Final deteriorated test result has the meaning given in the 
standard-setting part. If it is not defined in the standard-setting 
part, it means the emission level that results from applying all 
appropriate adjustments (such as deterioration factors) to the measured 
emission result of the emission-data engine.
    Gas turbine engine means anything commercially known as a gas 
turbine engine or any collection of assembled engine components that is 
substantially similar to engines commercially known as gas turbine 
engines. For example, a jet engine is a gas turbine engine. Gas turbine 
engines may be complete or partially complete. Turbines that rely on 
external combustion such as steam engines are not gas turbine engines.
    Good engineering judgment means judgments made consistent with 
generally accepted scientific and engineering principles and all 
available relevant information. See Sec.  1068.5.
    Manufacturer has the meaning given in section 216(1) of the Clean 
Air Act (42 U.S.C. 7550(1)). In general, this term includes any person 
who manufactures or assembles an engine or piece of equipment for sale 
in the United States or otherwise introduces a new engine or piece of 
equipment into U.S. commerce. This includes importers that import new 
engines or new equipment into the United States for resale. It also 
includes secondary engine manufacturers.
    Model year has the meaning given in the standard-setting part. 
Unless the standard-setting part specifies otherwise, model year for 
individual engines/equipment is based on the date of manufacture or a 
later stage in the assembly process determined by the manufacturer, 
subject to the limitations described in Sec. Sec.  1068.103 and 
1068.360. The model year of a new engine that is neither certified nor 
exempt is deemed to be the calendar year in which it is sold, offered 
for sale, imported, or delivered or otherwise introduced into U.S. 
commerce.
    Motor vehicle has the meaning given in 40 CFR 85.1703.
    New has the meaning we give it in the standard-setting part. Note 
that in certain cases, used and remanufactured engines/equipment may be 
``new'' engines/equipment.
    Nonroad engine means:
    (1) Except as discussed in paragraph (2) of this definition, a 
nonroad engine is an internal combustion engine that meets any of the 
following criteria:
    (i) It is (or will be) used in or on a piece of equipment that is 
self-propelled or serves a dual purpose by both propelling itself and 
performing another function (such as garden tractors, off-highway 
mobile cranes and bulldozers).
    (ii) It is (or will be) used in or on a piece of equipment that is 
intended to be propelled while performing its function (such as 
lawnmowers and string trimmers).
    (iii) By itself or in or on a piece of equipment, it is portable or 
transportable, meaning designed to be and capable of being carried or 
moved from one location to another. Indicia of transportability 
include, but are not limited to, wheels, skids, carrying handles, 
dolly, trailer, or platform.
    (2) An internal combustion engine is not a nonroad engine if it 
meets any of the following criteria:
    (i) The engine is used to propel a motor vehicle, an aircraft, or 
equipment used solely for competition.
    (ii) The engine is regulated under 40 CFR part 60, (or otherwise 
regulated by a federal New Source Performance Standard promulgated 
under section 111 of the Clean Air Act (42 U.S.C. 7411)). Note that 
this criterion does not apply for engines meeting any of the criteria 
of paragraph (1) of this definition that are voluntarily certified 
under 40 CFR part 60.
    (iii) The engine otherwise included in paragraph (1)(iii) of this 
definition remains or will remain at a location for more than 12 
consecutive months or a shorter period of time for an engine located at 
a seasonal source. A location is any single site at a building, 
structure, facility, or installation. For any engine (or engines) that 
replaces an engine at a location and that is intended to perform the 
same or similar function as the engine replaced, include the time 
period

[[Page 74220]]

of both engines in calculating the consecutive time period. An engine 
located at a seasonal source is an engine that remains at a seasonal 
source during the full annual operating period of the seasonal source. 
A seasonal source is a stationary source that remains in a single 
location on a permanent basis (i.e., at least two years) and that 
operates at that single location approximately three months (or more) 
each year. See Sec.  1068.31 for provisions that apply if the engine is 
removed from the location.
    Operating hours means:
    (1) For engine and equipment storage areas or facilities, times 
during which people other than custodians and security personnel are at 
work near, and can access, a storage area or facility.
    (2) For other areas or facilities, times during which an assembly 
line operates or any of the following activities occurs:
    (i) Testing, maintenance, or service accumulation.
    (ii) Production or compilation of records.
    (iii) Certification testing.
    (iv) Translation of designs from the test stage to the production 
stage.
    (v) Engine or equipment manufacture or assembly.
    Parent company means any entity that has a controlling ownership of 
another company. Note that the standard-setting part may treat a 
partial owner as a parent company even if it does not have controlling 
ownership of a company.
    Piece of equipment means any vehicle, vessel, locomotive, aircraft, 
or other type of equipment equipped with engines to which this part 
applies.
    Placed into service means used for its intended purpose. Engines/
equipment do not qualify as being ``placed into service'' based on 
incidental use by a manufacturer or dealer.
    Reasonable technical basis means information that would lead a 
person familiar with engine design and function to reasonably believe a 
conclusion related to compliance with the requirements of this part. 
For example, it would be reasonable to believe that parts performing 
the same function as the original parts (and to the same degree) would 
control emissions to the same degree as the original parts. Note that 
what is a reasonable basis for a person without technical training 
might not qualify as a reasonable technical basis.
    Relating to as used in this section means relating to something in 
a specific, direct manner. This expression is used in this section only 
to define terms as adjectives and not to broaden the meaning of the 
terms. Note that ``relating to'' is used in the same manner as in the 
standard-setting parts.
    Replacement engine means an engine exempted as a replacement engine 
under Sec.  1068.240.
    Revoke means to terminate the certificate or an exemption for a 
family. If we revoke a certificate or exemption, you must apply for a 
new certificate or exemption before continuing to introduce the 
affected engines/equipment into U.S. commerce. This does not apply to 
engines/equipment you no longer possess.
    Secondary engine manufacturer means anyone who produces a new 
engine by modifying a complete or partially complete engine that was 
made by a different company. For the purpose of this definition, 
``modifying'' does not include making changes that do not remove an 
engine from its original certified configuration. Secondary engine 
manufacturing includes, for example, converting automotive engines for 
use in industrial applications, or land-based engines for use in marine 
applications. This applies whether it involves a complete or partially 
complete engine and whether the engine was previously certified to 
emission standards or not.
    (1) Manufacturers controlled by the manufacturer of the base engine 
(or by an entity that also controls the manufacturer of the base 
engine) are not secondary engine manufacturers; rather, both entities 
are considered to be one manufacturer for purposes of this part.
    (2) This definition applies equally to equipment manufacturers that 
modify engines. Also, equipment manufacturers that certify to 
equipment-based standards using engines produced by another company are 
deemed to be secondary engine manufacturers.
    (3) Except as specified in paragraph (2) of this definition, 
companies importing complete engines into the United States are not 
secondary engine manufacturers regardless of the procedures and 
relationships between companies for assembling the engines.
    Small business means either of the following:
    (1) A company that qualifies under the standard-setting part for 
special provisions for small businesses or small-volume manufacturers.
    (2) A company that qualifies as a small business under the 
regulations adopted by the Small Business Administration at 13 CFR 
121.201 if the standard-setting part does not establish such qualifying 
criteria.
    Standard-setting part means a part in the Code of Federal 
Regulations that defines emission standards for a particular engine 
and/or piece of equipment (see Sec.  1068.1(a)). For example, the 
standard-setting part for marine spark-ignition engines is 40 CFR part 
1045. For provisions related to evaporative emissions, the standard-
setting part may be 40 CFR part 1060, as specified in 40 CFR 1060.1.
    Subsidiary means an entity that is owned or controlled by a parent 
company.
    Sulfur-sensitive technology means an emission control technology 
that experiences a significant drop in emission control performance or 
emission-system durability when an engine is operated on low-sulfur 
diesel fuel (i.e., fuel with a sulfur concentration of 300 to 500 ppm) 
as compared to when it is operated on ultra low-sulfur diesel fuel 
(i.e., fuel with a sulfur concentration less than 15 ppm). Exhaust gas 
recirculation is not a sulfur-sensitive technology.
    Suspend means to temporarily discontinue the certificate or an 
exemption for a family. If we suspend a certificate, you may not sell, 
offer for sale, or introduce or deliver into commerce in the United 
States or import into the United States engines/equipment from that 
family unless we reinstate the certificate or approve a new one. This 
also applies if we suspend an exemption, unless we reinstate the 
exemption.
    Ultimate purchaser means the first person who in good faith 
purchases a new engine or new piece of equipment for purposes other 
than resale.
    United States, in a geographic sense, means the States, the 
District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth 
of the Northern Mariana Islands, Guam, American Samoa, and the U.S. 
Virgin Islands.
    U.S.-directed production volume has the meaning given in the 
standard-setting part.
    Void means to invalidate a certificate or an exemption ab initio 
(``from the beginning''). If we void a certificate, all the engines/
equipment introduced into U.S. commerce under that family for that 
model year are considered uncertified (or nonconforming) and are 
therefore not covered by a certificate of conformity, and you are 
liable for all engines/equipment introduced into U.S. commerce under 
the certificate and may face civil or criminal penalties or both. This 
applies equally to all engines/equipment in the family, including 
engines/equipment introduced into U.S. commerce before we voided the 
certificate. If we void an exemption, all the engines/equipment 
introduced into U.S. commerce under that exemption are considered 
uncertified (or nonconforming), and you are liable for engines/
equipment introduced into U.S.

[[Page 74221]]

commerce under the exemption and may face civil or criminal penalties 
or both. You may not sell, offer for sale, or introduce or deliver into 
commerce in the United States or import into the United States any 
additional engines/equipment using the voided exemption.
    Voluntary emission recall means a repair, adjustment, or 
modification program voluntarily initiated and conducted by a 
manufacturer to remedy any emission-related defect for which engine 
owners have been notified.
    We (us, our) means the Administrator of the Environmental 
Protection Agency and any authorized representatives.

0
324. Section 1068.31 is amended by revising the section heading, the 
introductory text, and paragraph (c) to read as follows:


Sec.  1068.31  Changing the status of nonroad or stationary engines 
under the definition of ``nonroad engine''.

    This section specifies the provisions that apply when an engine 
previously used in a nonroad application is subsequently used in an 
application other than a nonroad application, or when an engine 
previously used in a stationary application (i.e., an engine that was 
not used as a nonroad engine and that was not used to propel a motor 
vehicle, an aircraft, or equipment used solely for competition) is 
moved.
* * * * *
    (c) A stationary engine does not become a new nonroad engine if it 
is moved but continues to meet the criteria specified in paragraph 
(2)(iii) in the definition of ``nonroad engine'' in Sec.  1068.30 in 
its new location. For example, a transportable engine that is used in a 
single specific location for 18 months and is later moved to a second 
specific location where it will remain for at least 12 months is 
considered to be a stationary engine in both locations. Note that for 
stationary engines that are neither portable nor transportable in 
actual use, the residence-time restrictions in the definition of 
``nonroad engine'' generally do not apply.
* * * * *

0
325. Section 1068.32 is added to read as follows:


Sec.  1068.32  Explanatory terms.

    This section explains how certain phrases and terms are used in 40 
CFR parts 1000 through 1099, especially those used to clarify and 
explain regulatory provisions.
    (a) Types of provisions. The term ``provision'' includes all 
aspects of the regulations in this subchapter U. As described in this 
section, regulatory provisions include standards, requirements, 
prohibitions, and allowances, along with a variety of other types of 
provisions. In certain cases, we may use these terms to apply to some 
but not all of the provisions of a part or section. For example, we may 
apply the allowances of a section for certain engines, but not the 
requirements. We may also apply all provisions except the requirements 
and prohibitions.
    (1) A standard is a requirement established by regulation that 
limits the emissions of air pollutants. Examples of standards include 
numerical emission standards (such as 0.01 g/kW-hr) and design 
standards (such as a closed crankcase standard). Compliance with or 
conformance to a standard is a specific type of requirement, and in 
some cases a standard may be discussed as a requirement. Thus, a 
statement about the requirements of a part or section also applies with 
respect to the standards of the part or section.
    (2) The regulations in subchapter U of this chapter apply other 
requirements in addition to standards. For example, manufacturers are 
required to keep records and provide reports to EPA.
    (3) While requirements state what someone must do, prohibitions 
state what someone may not do. Prohibitions are often referred to as 
prohibited acts or prohibited actions. Most penalties apply for 
violations of prohibitions. A list of prohibitions may therefore 
include the failure to meet a requirement as a prohibited action.
    (4) Allowances provide some form of relief from requirements. This 
may include provisions delaying implementation, establishing exemptions 
or test waivers, or creating alternative compliance options. Allowances 
may be conditional. For example, we may exempt you from certain 
requirements on the condition that you meet certain other requirements.
    (5) The regulations in subchapter U of this chapter also include 
important provisions that are not standards, requirements, 
prohibitions, or allowances, such as definitions.
    (6) Engines/equipment are generally considered ``subject to'' a 
specific provision if that provision applies, or if it does not apply 
because of an exemption authorized under the regulation. For example, 
locomotives are subject to the provisions of 40 CFR part 1033 even if 
they are exempted from the standards of part 1033.
    (b) Singular and plural. Unless stated otherwise or unless it is 
clear from the regulatory context, provisions written in singular form 
include the plural form and provisions written in plural form include 
the singular form. For example, the statement ``The manufacturer must 
keep this report for three years'' is equivalent to ``The manufacturers 
must keep these reports for three years.''
    (c) Inclusive lists. Lists in the regulations in subchapter U of 
this chapter prefaced by ``including'' or ``this includes'' are not 
exhaustive. The terms ``including'' and ``this includes'' should be 
read to mean ``including but not limited to'' and ``this includes but 
is not limited to''. For example, the phrase ``including small 
manufacturers'' does not exclude large manufacturers. However, 
prescriptive statements to ``include'' specific items (such as those 
related to recordkeeping and reporting requirements) may be exhaustive.
    (d) Notes. Statements that begin with ``Note:'' or ``Note that'' 
are intended to clarify specific regulatory provisions stated elsewhere 
in the regulations in subchapter U of this chapter. By themselves, such 
statements are not intended to specify regulatory requirements. Such 
statements are typically used for regulatory text that, while legally 
sufficient to specify a requirement, may be misunderstood by some 
readers. For example, the regulations might note that a word is defined 
elsewhere in the regulations to have a specific meaning that may be 
either narrower or broader than some readers might assume.
    (e) Examples. Examples provided in the regulations in subchapter U 
of this chapter are typically introduced by either ``for example'' or 
``such as''. Specific examples given in the regulations do not 
necessarily represent the most common examples. The regulations may 
specify examples conditionally (that is, specifying that they are 
applicable only if certain criteria or conditions are met). Lists of 
examples cannot be presumed to be exhaustive lists.
    (f) Generally and typically. Statements that begin with 
``generally'', ``in general'', or ``typically'' should not be read to 
apply universally or absolutely. Rather they are intended to apply for 
the most common circumstances. ``Generally'' and ``typically'' 
statements may be identified as notes as described in paragraph (d) of 
this section.
    (g) Unusual circumstances. The regulations in subchapter U of this 
chapter specify certain allowances that apply ``in unusual 
circumstances''. While it is difficult to precisely define what 
``unusual circumstances'' means, this generally refers to specific 
circumstances that are both rare and unforeseeable. For example, a 
severe hurricane in the northeastern United States may be considered to 
be an

[[Page 74222]]

unusual circumstance, while a less severe hurricane in the southeastern 
United States may not be. Where the regulations limit an allowance to 
unusual circumstances, manufacturers and others should not presume that 
such an allowance will be available to them. Provisions related to 
unusual circumstances may be described using the phrase ``normal 
circumstances'', which are those circumstances that are not unusual 
circumstances.
    (h) Exceptions and other specifications. Regulatory provisions may 
be expressed as a general prohibition, requirement, or allowance that 
is modified by other regulatory text. Such provisions may include 
phrases such as ``unless specified otherwise'', ``except as 
specified'', or ``as specified in this section''. It is important that 
the exceptions and the more general statement be considered together. 
This regulatory construct is intended to allow the core requirement or 
allowance to be stated in simple, clear sentences, rather than more 
precise and comprehensive sentences that may be misread. For example, 
where an action is prohibited in most but not all circumstances, the 
provision may state that you may not take the action, ``except as 
specified in this section.'' The exceptions could then be stated in 
subsequent regulatory text.

0
326. Revise the section heading for Sec.  1068.35 to read as follows:


Sec.  1068.35  Symbols, acronyms, and abbreviations.

* * * * *

0
327. Section 1068.40 is amended by revising the section heading and 
paragraph (a) and removing paragraph (c).
    The revisions read as follows:


Sec.  1068.40  Special provisions for implementing changes in the 
regulations in this part.

    (a) During the 12 months following the effective date of any change 
in the provisions of this part, you may ask to apply the previously 
applicable provisions. Note that the effective date is generally 30 or 
60 days after publication in the Federal Register, as noted in the 
final rule. We will generally approve your request if you can 
demonstrate that it would be impractical to comply with the new 
requirements. We may consider the potential for adverse environmental 
impacts in our decision. Similarly, in unusual circumstances, you may 
ask for relief under this paragraph (a) from new requirements that 
apply under the standard-setting part.
* * * * *

0
328. Section 1068.45 is amended by revising paragraph (e) and adding 
paragraphs (g) and (h) to read as follows:


Sec.  1068.45  General labeling provisions.

* * * * *
    (e) Prohibitions against removing labels. As specified in Sec.  
1068.101(b)(7), removing permanent labels is prohibited except for 
certain circumstances. Removing temporary or removable labels 
prematurely is also prohibited by Sec.  1068.101(b)(7).
* * * * *
    (g) Date format. If you use a coded approach to identify the 
engine/equipment's date of manufacture, describe or interpret the code 
in your application for certification.
    (h) Branding. The following provisions apply if you identify the 
name and trademark of another company instead of your own on your 
emission control information label, as provided in the standard-setting 
part:
    (1) You must have a contractual agreement with the other company 
that obligates that company to take the following steps:
    (i) Meet the emission warranty requirements that apply under the 
standard-setting part. This may involve a separate agreement involving 
reimbursement of warranty-related expenses.
    (ii) Report all warranty-related information to the certificate 
holder.
    (2) In your application for certification, identify the company 
whose trademark you will use.
    (3) You remain responsible for meeting all the requirements of this 
chapter, including warranty and defect-reporting provisions.

0
329. Section 1068.95 is revised to read as follows:


Sec.  1068.95  Incorporation by reference.

    (a) Certain material is incorporated by reference into this part 
with the approval of the Director of the Federal Register under 5 
U.S.C. 552(a) and 1 CFR part 51. To enforce any edition other than that 
specified in this section, the Environmental Protection Agency must 
publish a document in the Federal Register and the material must be 
available to the public. All approved materials are available for 
inspection at the Air and Radiation Docket and Information Center (Air 
Docket) in the EPA Docket Center (EPA/DC) at Rm. 3334, EPA West Bldg., 
1301 Constitution Ave. NW., Washington, DC The EPA/DC Public Reading 
Room hours of operation are 8:30 a.m. to 4:30 p.m., Monday through 
Friday, excluding legal holidays. The telephone number of the EPA/DC 
Public Reading Room is (202) 566-1744, and the telephone number for the 
Air Docket is (202) 566-1742. These approved materials are also 
available for inspection at the National Archives and Records 
Administration (NARA). For information on the availability of this 
material at NARA, call (202) 741-6030 or go to http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html. In 
addition, these materials are available from the sources listed below.
    (b) SAE International, 400 Commonwealth Dr., Warrendale, PA 15096-
0001, (724) 776-4841, or http://www.sae.org:
    (1) SAE J1930, Electrical/Electronic Systems Diagnostic Terms, 
Definitions, Abbreviations, and Acronyms, revised October 2008 (``SAE 
J1930''), IBR approved for Sec.  1068.45(f).
    (2) [Reserved]

Subpart B--Prohibited Actions and Related Requirements

0
330. Section 1068.101 is amended by revising the introductory text and 
paragraphs (a)(1) through (3), (b)(1) introductory text, (b)(2), 
(b)(3), (b)(4), (b)(5) introductory text, (b)(6), and (h) introductory 
text to read as follows:


Sec.  1068.101  What general actions does this regulation prohibit?

    This section specifies actions that are prohibited and the maximum 
civil penalties that we can assess for each violation in accordance 
with 42 U.S.C. 7522 and 7524. The maximum penalty values listed in 
paragraphs (a) and (b) of this section and in Sec.  1068.125 apply as 
of August 1, 2016. As described in paragraph (h) of this section, these 
maximum penalty limits are different for earlier violations and they 
may be adjusted as set forth in 40 CFR part 19.
    (a) * * *
    (1) Introduction into commerce. You may not sell, offer for sale, 
or introduce or deliver into commerce in the United States or import 
into the United States any new engine/equipment after emission 
standards take effect for the engine/equipment, unless it is covered by 
a valid certificate of conformity for its model year and has the 
required label or tag. You also may not take any of the actions listed 
in the previous sentence with respect to any equipment containing an 
engine subject to this part's provisions unless the engine is covered 
by a valid certificate of conformity for its model year and has the 
required engine label or tag. We may assess a civil penalty up to 
$44,539 for each engine or piece of equipment in violation.

[[Page 74223]]

    (i) For purposes of this paragraph (a)(1), a valid certificate of 
conformity is one that applies for the same model year as the model 
year of the equipment (except as allowed by Sec.  1068.105(a)), covers 
the appropriate category or subcategory of engines/equipment (such as 
locomotive or sterndrive/inboard Marine SI or nonhandheld Small SI), 
and conforms to all requirements specified for equipment in the 
standard-setting part. Engines/equipment are considered not covered by 
a certificate unless they are in a configuration described in the 
application for certification.
    (ii) The prohibitions of this paragraph (a)(1) also apply for new 
engines you produce to replace an older engine in a piece of equipment, 
except that the engines may qualify for the replacement-engine 
exemption in Sec.  1068.240.
    (iii) The prohibitions of this paragraph (a)(1) also apply for new 
engines that will be installed in equipment subject to equipment-based 
standards, except that the engines may qualify for an exemption under 
Sec.  1068.260(c) or Sec.  1068.262.
    (iv) Where the regulations specify that you are allowed to 
introduce engines/equipment into U.S. commerce without a certificate of 
conformity, you may take any of the otherwise prohibited actions 
specified in this paragraph (a)(1) with respect to those engines/
equipment.
    (2) Reporting and recordkeeping. This chapter requires you to 
record certain types of information to show that you meet our 
standards. You must comply with these requirements to make and maintain 
required records (including those described in Sec.  1068.501). You may 
not deny us access to your records or the ability to copy your records 
if we have the authority to see or copy them. Also, you must give us 
complete and accurate reports and information without delay as required 
under this chapter. Failure to comply with the requirements of this 
paragraph is prohibited. We may assess a civil penalty up to $44,539 
for each day you are in violation. In addition, knowingly submitting 
false information is a violation of 18 U.S.C. 1001, which may involve 
criminal penalties and up to five years imprisonment.
    (3) Testing and access to facilities. You may not keep us from 
entering your facility to test engines/equipment or inspect if we are 
authorized to do so. Also, you must perform the tests we require (or 
have the tests done for you). Failure to perform this testing is 
prohibited. We may assess a civil penalty up to $44,539 for each day 
you are in violation.
    (b) * * *
    (1) Tampering. You may not remove or render inoperative any device 
or element of design installed on or in engines/equipment in compliance 
with the regulations prior to its sale and delivery to the ultimate 
purchaser. You also may not knowingly remove or render inoperative any 
such device or element of design after such sale and delivery to the 
ultimate purchaser. This includes, for example, operating an engine 
without a supply of appropriate quality urea if the emission control 
system relies on urea to reduce NOX emissions or the use of 
incorrect fuel or engine oil that renders the emission control system 
inoperative. Section 1068.120 describes how this applies to rebuilding 
engines. See the standard-setting part, which may include additional 
provisions regarding actions prohibited by this requirement. For a 
manufacturer or dealer, we may assess a civil penalty up to $44,539 for 
each engine or piece of equipment in violation. For anyone else, we may 
assess a civil penalty up to $4,454 for each engine or piece of 
equipment in violation. This prohibition does not apply in any of the 
following situations:
* * * * *
    (2) Defeat devices. You may not knowingly manufacture, sell, offer 
to sell, or install, any component that bypasses, impairs, defeats, or 
disables the control of emissions of any regulated pollutant, except as 
explicitly allowed by the standard-setting part. We may assess a civil 
penalty up to $4,454 for each component in violation.
    (3) Stationary engines. For an engine that is excluded from any 
requirements of this chapter because it is a stationary engine, you may 
not move it or install it in any mobile equipment except as allowed by 
the provisions of this chapter. You may not circumvent or attempt to 
circumvent the residence-time requirements of paragraph (2)(iii) of the 
nonroad engine definition in Sec.  1068.30. Anyone violating this 
paragraph (b)(3) is deemed to be a manufacturer in violation of 
paragraph (a)(1) of this section. We may assess a civil penalty up to 
$44,539 for each engine or piece of equipment in violation.
    (4) Competition engines/equipment. (i) For uncertified engines/
equipment that are excluded or exempted as new engines/equipment from 
any requirements of this chapter because they are to be used solely for 
competition, you may not use any of them in a manner that is 
inconsistent with use solely for competition. Anyone violating this 
paragraph (b)(4)(i) is deemed to be a manufacturer in violation of 
paragraph (a)(1) of this section. We may assess a civil penalty up to 
$44,539 for each engine or piece of equipment in violation. (ii) For 
certified nonroad engines/equipment that qualify for exemption from the 
tampering prohibition as described in Sec.  1068.235 because they are 
to be used solely for competition, you may not use any of them in a 
manner that is inconsistent with use solely for competition. Anyone 
violating this paragraph (b)(4)(ii) is in violation of paragraph (b)(1) 
or (2) of this section.
    (5) Importation. You may not import an uncertified engine or piece 
of equipment if it is defined to be new in the standard-setting part 
with a model year for which emission standards applied. Anyone 
violating this paragraph (b)(5) is deemed to be a manufacturer in 
violation of paragraph (a)(1) of this section. We may assess a civil 
penalty up to $44,539 for each engine or piece of equipment in 
violation. Note the following:
* * * * *
    (6) Warranty, recall, and maintenance instructions. You must meet 
your obligation to honor your emission-related warranty under Sec.  
1068.115, including any commitments you identify in your application 
for certification. You must also fulfill all applicable requirements 
under subpart F of this part related to emission-related defects and 
recalls. You must also provide emission-related installation and 
maintenance instructions as described in the standard-setting part. 
Failure to meet these obligations is prohibited. Also, except as 
specifically provided by regulation, you are prohibited from directly 
or indirectly communicating to the ultimate purchaser or a later 
purchaser that the emission-related warranty is valid only if the owner 
has service performed at authorized facilities or only if the owner 
uses authorized parts, components, or systems. We may assess a civil 
penalty up to $44,539 for each engine or piece of equipment in 
violation.
* * * * *
    (h) The maximum penalty values listed in paragraphs (a) and (b) of 
this section and in Sec.  1068.125 apply as of August 1, 2016. Maximum 
penalty values for earlier violations are published in 40 CFR part 19. 
Maximum penalty limits may be adjusted after August 1, 2016 based on 
the Consumer Price Index. The specific regulatory provisions for 
changing the maximum penalties, published in 40 CFR part 19, reference 
the applicable U.S. Code citation on which the prohibited action

[[Page 74224]]

is based. The following table is shown here for informational purposes:
* * * * *

0
331. Section 1068.103 is revised to read as follows:


Sec.  1068.103  Provisions related to the duration and applicability of 
certificates of conformity.

    (a) Engines/equipment covered by a certificate of conformity are 
limited to those that are produced during the period specified in the 
certificate and conform to the specifications described in the 
certificate and the associated application for certification. For the 
purposes of this paragraph (a), ``specifications'' includes the 
emission control information label and any conditions or limitations 
identified by the manufacturer or EPA. For example, if the application 
for certification specifies certain engine configurations, the 
certificate does not cover any configurations that are not specified. 
We may ignore any information provided in the application that we 
determine is not relevant to a demonstration of compliance with 
applicable regulations, such as your projected production volumes in 
many cases.
    (b) Unless the standard-setting part specifies otherwise, determine 
the production period corresponding to each certificate of conformity 
as specified in this paragraph (b). In general, the production period 
is the manufacturer's annual production period identified as a model 
year.
    (1) For engines/equipment subject to emission standards based on 
model years, the first day of the annual production period can be no 
earlier than January 2 of the calendar year preceding the year for 
which the model year is named, or the earliest date of manufacture for 
any engine/equipment in the engine family, whichever is later. The last 
day of the annual production period can be no later than December 31 of 
the calendar year for which the model year is named or the latest date 
of manufacture for any engine/equipment in the engine family, whichever 
is sooner. Note that this approach limits how you can designate a model 
year for your engines/equipment; however, it does not limit your 
ability to meet more stringent emission standards early where this is 
permitted in the regulation.
    (2) For fuel-system components certified to evaporative emission 
standards based on production periods rather than model years, the 
production period is either the calendar year or a longer period we 
specify consistent with the manufacturer's normal production practices.
    (c) A certificate of conformity will not cover engines/equipment 
you produce with a date of manufacture earlier than the date you submit 
the application for certification for the family. You may start to 
produce engines/equipment after you submit an application for 
certification and before the effective date of a certificate of 
conformity, subject to the following conditions:
    (1) The engines/equipment must conform in all material respects to 
the engines/equipment described in your application. Note that if we 
require you to modify your application, you must ensure that all 
engines/equipment conform to the specifications of the modified 
application.
    (2) The engines/equipment may not be sold, offered for sale, 
introduced into U.S. commerce, or delivered for introduction into U.S. 
commerce before the effective date of the certificate of conformity.
    (3) You must notify us in your application for certification that 
you plan to use the provisions of this paragraph (c) and when you 
intend to start production. If the standard-setting part specifies 
mandatory testing for production-line engines, you must start testing 
as directed in the standard-setting part based on your actual start of 
production, even if that occurs before we approve your certification. 
You must also agree to give us full opportunity to inspect and/or test 
the engines/equipment during and after production. For example, we must 
have the opportunity to specify selective enforcement audits as allowed 
by the standard-setting part and the Clean Air Act as if the engines/
equipment were produced after the effective date of the certificate.
    (4) See Sec.  1068.262 for special provisions that apply for 
secondary engine manufacturers receiving shipment of partially complete 
engines before the effective date of a certificate.
    (d) The prohibition in Sec.  1068.101(a)(1) against offering to 
sell engines/equipment without a valid certificate of conformity 
generally does not apply for engines/equipment that have not yet been 
produced. You may contractually agree to produce engines/equipment 
before obtaining the required certificate of conformity. This is 
intended to allow manufacturers of low-volume products to establish a 
sufficient market for engines/equipment before going through the effort 
to certify.
    (e) Engines/equipment with a date of manufacture after December 31 
of the calendar year for which a model year is named are not covered by 
the certificate of conformity for that model year. You must submit an 
application for a new certificate of conformity demonstrating 
compliance with applicable standards even if the engines/equipment are 
identical to those with a date of manufacture before December 31.
    (f) The flexible approach to naming the annual production period 
described in paragraph (b)(1) of this section is intended to allow you 
to introduce new products at any point during the year. This is based 
on the expectation that production periods generally run on consistent 
schedules from year to year. You may not use this flexibility to 
arrange your production periods such that you can avoid annual 
certification.
    (g) An engine is generally assigned a model year based on its date 
of manufacture, which is typically based on the date the crankshaft is 
installed in the engine (see Sec.  1068.30). You may not circumvent the 
provisions of Sec.  1068.101(a)(1) by stockpiling engines with a date 
of manufacture before new or changed emission standards take effect by 
deviating from your normal production and inventory practices. (For 
purposes of this paragraph (g), normal production and inventory 
practices means those practices you typically use for similar families 
in years in which emission standards do not change. We may require you 
to provide us routine production and inventory records that document 
your normal practices for the preceding eight years.) For most engines 
you should plan to complete the assembly of an engine of a given model 
year into its certified configuration within the first week after the 
end of the model year if new emission standards start to apply in that 
model year. For special circumstances it may be appropriate for your 
normal business practice to involve more time. For engines with per-
cylinder displacement below 2.5 liters, if new emission standards start 
to apply in a given year, we would consider an engine not to be covered 
by a certificate of conformity for the preceding model year if the 
engine is not assembled in a compliant configuration within 30 days 
after the end of the model year for that engine family. (Note: an 
engine is considered ``in a compliant configuration'' without being 
fully assembled if Sec.  1068.260(a) or (b) authorizes shipment of the 
engine without certain components.) For example, in the case where new 
standards apply in the 2010 model year, and your normal production 
period is based on the calendar year, you must complete the assembly of 
all your 2009 model year engines before January 31, 2010, or an earlier 
date consistent with your normal production and inventory practices. 
For engines with per-cylinder displacement at or above 2.5 liters, this

[[Page 74225]]

time may not exceed 60 days. Note that for the purposes of this 
paragraph (g), an engine shipped under Sec.  1068.261 is deemed to be a 
complete engine. Note also that Sec.  1068.245 allows flexibility for 
additional time in unusual circumstances. Note finally that disassembly 
of complete engines and reassembly (such as for shipment) does not 
affect the determination of model year; the provisions of this 
paragraph (g) apply based on the date on which initial assembly is 
complete.
    (h) This paragraph (h) describes the effect of suspending, 
revoking, or voiding a certificate of conformity. See the definitions 
of ``suspend,'' ``revoke,'' and ``void'' in Sec.  1068.30. Engines/
equipment produced at a time when the otherwise applicable certificate 
of conformity has been suspended or revoked are not covered by a 
certificate of conformity. Where a certificate of conformity is void, 
all engines/equipment produced under that certificate of conformity are 
not and were not covered by a certificate of conformity. In cases of 
suspension, engines/equipment will be covered by a certificate only if 
they are produced after the certificate is reinstated or a new 
certificate is issued. In cases of revocation and voiding, engines/
equipment will be covered by a certificate only if they are produced 
after we issue a new certificate. 42 U.S.C. 7522(a)(1) and Sec.  
1068.101(a)(1) prohibit selling, offering for sale, introducing into 
commerce, delivering for introduction into commerce, and importing 
engines/equipment that are not covered by a certificate of conformity, 
and they prohibit anyone from causing another to violate these 
prohibitions.
    (i) You may transfer a certificate to another entity only in the 
following cases:
    (1) You may transfer a certificate to a parent company, including a 
parent company that purchases your company after we have issued your 
certificate.
    (2) You may transfer a certificate to a subsidiary including a 
subsidiary you purchase after we have issued your certificate.
    (3) You may transfer a certificate to a subsidiary of your parent 
company.

0
332. Section 1068.105 is amended by revising paragraphs (a) and (c)(2) 
to read as follows:


Sec.  1068.105  What other provisions apply to me specifically if I 
manufacture equipment needing certified engines?

* * * * *
    (a) Transitioning to new engine-based standards. If new engine-
based emission standards apply in a given model year, your equipment 
produced in that calendar year (or later) must have engines that are 
certified to the new standards, except that you may continue to use up 
normal inventories of engines that were built before the date of the 
new or changed standards. For purposes of this paragraph (a), normal 
inventory applies for engines you possess and engines from your engine 
supplier's normal inventory. (Note: this paragraph (a) does not apply 
in the case of new remanufacturing standards.) We may require you and 
your engine suppliers to provide us routine production and/or inventory 
records that document your normal practices for the preceding eight 
years. For example, if you have records documenting that your normal 
inventory practice is to keep on hand a one-month supply of engines 
based on your upcoming production schedules, and a new tier of 
standards starts to apply for the 2015 model year, you may order 
engines consistent with your normal inventory requirements late in the 
engine manufacturer's 2014 model year and install those engines in your 
equipment consistent with your normal production schedule. Also, if 
your model year starts before the end of the calendar year preceding 
new standards, you may use engines from the previous model year for 
those units you completely assemble before January 1 of the year that 
new standards apply. If emission standards for the engine do not change 
in a given model year, you may continue to install engines from the 
previous model year without restriction (or any earlier model year for 
which the same standards apply). You may not circumvent the provisions 
of Sec.  1068.101(a)(1) by stockpiling engines that were built before 
new or changed standards take effect. Similarly, you may not circumvent 
the provisions of Sec.  1068.101(a)(1) by knowingly installing engines 
that were stockpiled by engine suppliers in violation of Sec.  
1068.103(f). Note that this allowance does not apply for equipment 
subject to equipment-based standards. See 40 CFR 1060.601 for similar 
provisions that apply for equipment subject to evaporative emission 
standards. Note that the standard-setting part may impose further 
restrictions on using up inventories of engines from an earlier model 
year under this paragraph (a).
* * * * *
    (c) * * *
    (2) Permanently attach the duplicate label to your equipment by 
securing it to a part needed for normal operation and not normally 
requiring replacement. Make sure an average person can easily read it. 
Note that attaching an inaccurate duplicate label may be a violation of 
Sec.  1068.101(b)(7).
* * * * *

0
333. Section 1068.110 is amended by revising the section heading and 
paragraph (d) to read as follows:


Sec.  1068.110  Other provisions for engines/equipment in service.

* * * * *
    (d) Defeat devices. We may test components, engines, and equipment 
to investigate potential defeat devices. We may also require the 
manufacturer to do this testing. If we choose to investigate one of 
your designs, we may require you to show us that a component is not a 
defeat device, and that an engine/equipment does not have a defeat 
device. To do this, you may have to share with us information regarding 
test programs, engineering evaluations, design specifications, 
calibrations, on-board computer algorithms, and design strategies. It 
is a violation of the Clean Air Act for anyone to make, install or use 
defeat devices as described in Sec.  1068.101(b)(2) and the standard-
setting part.
* * * * *

0
334. Section 1068.115 is amended by revising the section heading to 
read as follows:


Sec.  1068.115  What are manufacturers' emission-related warranty 
requirements?

* * * * *

0
335. Section 1068.120 is amended by revising the section heading and 
paragraph (f) to read as follows:


Sec.  1068.120  Requirements for rebuilding engines.

* * * * *
    (f) A rebuilt engine or other used engine may replace a certified 
engine in a piece of equipment only if the engine was built and/or 
rebuilt to a certified configuration meeting equivalent or more 
stringent emission standards. Note that a certified configuration would 
generally include more than one model year. A rebuilt engine being 
installed that is from the same model year or a newer model year than 
the engine being replaced meets this requirement. The following 
examples illustrate the provisions of this paragraph (f):
    (1) In most cases, you may use a rebuilt Tier 2 engine to replace a 
Tier 1 engine or another Tier 2 engine.
    (2) You may use a rebuilt Tier 1 engine to replace a Tier 2 engine 
if the two engines differ only with respect to model year or other 
characteristics unrelated to emissions since such engines would be 
considered to be in the same configuration. This may occur if the Tier 
1 engine had emission levels

[[Page 74226]]

below the Tier 2 standards or if the Tier 2 engine was certified with a 
Family Emission Limit for calculating emission credits.
    (3) You may use a rebuilt engine that originally met the Tier 1 
standards without certification, as provided under Sec.  1068.265, to 
replace a certified Tier 1 engine. This may occur for engines produced 
under a Transition Program for Equipment Manufacturers such as that 
described in 40 CFR 1039.625.
    (4) You may never replace a certified engine with an engine rebuilt 
to a configuration that does not meet EPA emission standards. Note 
that, for purposes of this paragraph (f)(4), a configuration is 
considered to meet EPA emission standards if it was previously 
certified or was otherwise shown to meet emission standards (see Sec.  
1068.265).
    (5) The standard-setting part may apply further restrictions to 
situations involving installation of used engines to repower equipment. 
For example, see 40 CFR part 1037 for provisions that apply for glider 
vehicles.
* * * * *

0
336. Section 1068.125 is amended by revising paragraph (b) introductory 
text to read as follows:


Sec.  1068.125  What happens if I violate the regulations?

* * * * *
    (b) Administrative penalties. Instead of bringing a civil action, 
we may assess administrative penalties if the total is less than 
$356,312 against you individually. This maximum penalty may be greater 
if the Administrator and the Attorney General jointly determine that a 
greater administrative penalty assessment is appropriate, or if the 
limit is adjusted under 40 CFR part 19. No court may review this 
determination. Before we assess an administrative penalty, you may ask 
for a hearing as described in subpart G of this part. The Administrator 
may compromise or remit, with or without conditions, any administrative 
penalty that may be imposed under this section.
* * * * *

Subpart C--Exemptions and Exclusions

0
337. Section 1068.201 is amended by revising the section heading, 
introductory text, and paragraphs (a) and (c) to read as follows:


Sec.  1068.201  General exemption and exclusion provisions.

    We may exempt new engines/equipment from some or all of the 
prohibited acts or requirements of this part under provisions described 
in this subpart. We may exempt nonroad engines/equipment already placed 
in service in the United States from the prohibition in Sec.  
1068.101(b)(1) if the exemption for nonroad engines/equipment used 
solely for competition applies (see Sec.  1068.235). In addition, see 
Sec.  1068.1 and the standard-setting parts to determine if other 
engines/equipment are excluded from some or all of the regulations in 
this chapter.
    (a) This subpart identifies which engines/equipment qualify for 
exemptions and what information we need. We may require more 
information.
* * * * *
    (c) If you use an exemption under this subpart, we may require you 
to add a permanent or removable label to your exempted engines/
equipment. You may ask us to modify these labeling requirements if it 
is appropriate for your engine/equipment.
* * * * *

0
338. Section 1068.210 is amended by revising the section heading and 
paragraph (e) to read as follows:


Sec.  1068.210  Exempting test engines/equipment.

* * * * *
    (e) If we approve your request for a testing exemption, we will 
send you a letter or a memorandum describing the basis and scope of the 
exemption. It will also include any necessary terms and conditions, 
which normally require you to do the following:
    (1) Stay within the scope of the exemption.
    (2) Create and maintain adequate records that we may inspect.
    (3) Add a permanent label to all engines/equipment exempted under 
this section, consistent with Sec.  1068.45, with at least the 
following items:
    (i) The label heading ``EMISSION CONTROL INFORMATION''.
    (ii) Your corporate name and trademark.
    (iii) Engine displacement, family identification, and model year of 
the engine/equipment (as applicable), or whom to contact for further 
information.
    (iv) The statement: ``THIS [engine, equipment, vehicle, etc.] IS 
EXEMPT UNDER 40 CFR 1068.210 OR 1068.215 FROM EMISSION STANDARDS AND 
RELATED REQUIREMENTS.''
    (4) Tell us when the test program is finished.
    (5) Tell us the final disposition of the engines/equipment.

0
339. Section 1068.215 is amended by revising the section heading and 
paragraphs (a) and (c)(3)(iv) to read as follows:


Sec.  1068.215  Exempting manufacturer-owned engines/equipment.

    (a) You are eligible for this exemption for manufacturer-owned 
engines/equipment only if you are a certificate holder. Any engine for 
which you meet all applicable requirements under this section is exempt 
without request.
* * * * *
    (c) * * *
    (3) * * *
    (iv) The statement: ``THIS [engine, equipment, vehicle, etc.] IS 
EXEMPT UNDER 40 CFR 1068.210 OR 1068.215 FROM EMISSION STANDARDS AND 
RELATED REQUIREMENTS.''

0
340. Section 1068.220 is revised to read as follows:


Sec.  1068.220  Exempting display engines/equipment.

    (a) Anyone may request an exemption for display engines/equipment.
    (b) Nonconforming display engines/equipment will be exempted if 
they are used only for displays in the interest of a business or the 
general public. This exemption does not apply to engines/equipment 
displayed for private use, private collections, or any other purpose we 
determine is inappropriate for a display exemption.
    (c) You may operate the exempted engine/equipment, but only if we 
approve specific operation that is part of the display, or is necessary 
for the display (possibly including operation that is indirectly 
necessary for the display). We may consider any relevant factor in our 
approval process, including the extent of the operation, the overall 
emission impact, and whether the engine/equipment meets emission 
requirements of another country.
    (d) You may sell or lease the exempted engine/equipment only with 
our advance approval.
    (e) To use this exemption, you must add a permanent label to all 
engines/equipment exempted under this section, consistent with Sec.  
1068.45, with at least the following items:
    (1) The label heading ``EMISSION CONTROL INFORMATION''.
    (2) Your corporate name and trademark.
    (3) Engine displacement, family identification, and model year of 
the engine/equipment (as applicable), or whom to contact for further 
information.
    (4) The statement: ``THIS [engine, equipment, vehicle, etc.] IS 
EXEMPT UNDER 40 CFR 1068.220 FROM EMISSION STANDARDS AND RELATED 
REQUIREMENTS.''
    (f) We may set other conditions for approval of this exemption.

[[Page 74227]]


0
341. Section 1068.225 is revised to read as follows:


Sec.  1068.225  Exempting engines/equipment for national security.

    The standards and requirements of the standard-setting part and the 
prohibitions in Sec.  1068.101(a)(1) and (b) do not apply to engines 
exempted under this section.
    (a) An engine/equipment is exempt without a request if it will be 
owned by an agency of the Federal Government responsible for national 
defense and it meets at least one of the following criteria:
    (1) An engine is automatically exempt in cases where the equipment 
in which it will be installed has armor, permanently attached weaponry, 
or other substantial features typical of military combat. Similarly, 
equipment subject to equipment-based standards is automatically exempt 
if it has any of these same features.
    (2) In the case of marine vessels with compression-ignition 
engines, an engine is automatically exempt if the vessel in which it 
will be installed has specialized electronic warfare systems, unique 
stealth performance requirements, or unique combat maneuverability 
requirements.
    (3) Gas turbine engines installed in marine vessels are 
automatically exempt.
    (4) An engine/equipment is automatically exempt if it would need 
sulfur-sensitive technology to comply with emission standards, and it 
is intended to be used in areas outside the United States where ultra 
low-sulfur fuel is unavailable.
    (b) For the circumstances described in paragraphs (a)(1) and (2) of 
this section, an engine/equipment is also exempt without a request if 
it will be used, but not owned, by an agency of the Federal Government 
responsible for national defense.
    (c) Manufacturers may produce and ship engines/equipment under an 
automatic exemption as described in paragraph (a) or (b) of this 
section if they receive a written request for such engines/equipment 
from the appropriate federal agency.
    (d) Manufacturers may request a national security exemption for 
engines/equipment not meeting the conditions of paragraphs (a) and (b) 
of this section as long as the request is endorsed by an agency of the 
Federal Government responsible for national defense. In your request, 
explain why you need the exemption.
    (e) Add a permanent label to all engines/equipment exempted under 
this section, consistent with Sec.  1068.45, with at least the 
following items:
    (1) The label heading ``EMISSION CONTROL INFORMATION''.
    (2) Your corporate name and trademark.
    (3) Engine displacement, family identification, and model year of 
the engine/equipment (as applicable), or whom to contact for further 
information.
    (4) The statement: ``THIS [engine, equipment, vehicle, etc.] HAS AN 
EXEMPTION FOR NATIONAL SECURITY UNDER 40 CFR 1068.225.''

0
342. Section 1068.230 is amended by revising the section heading and 
paragraphs (b) and (c) to read as follows:


Sec.  1068.230  Exempting engines/equipment for export.

* * * * *
    (b) Engines/equipment exported to a country not covered by 
paragraph (a) of this section are exempt from the prohibited acts in 
this part without a request. If you produce exempt engines/equipment 
for export and any of them are sold or offered for sale to an ultimate 
purchaser in the United States, the exemption is automatically void for 
those engines/equipment, except as specified in Sec.  1068.201(i). You 
may operate engines/equipment in the United States only as needed to 
prepare and deliver them for export.
    (c) Except as specified in paragraph (d) of this section, label 
exempted engines/equipment (including shipping containers if the label 
on the engine/equipment will be obscured by the container) with a label 
showing that they are not certified for sale or use in the United 
States. This label may be permanent or removable. See Sec.  1068.45 for 
provisions related to the use of removable labels and applying labels 
to containers without labeling individual engines/equipment. The label 
must include your corporate name and trademark and the following 
statement: ``THIS [engine, equipment, vehicle, etc.] IS SOLELY FOR 
EXPORT AND IS THEREFORE EXEMPT UNDER 40 CFR 1068.230 FROM U.S. EMISSION 
STANDARDS AND RELATED REQUIREMENTS.''
* * * * *

0
343. Section 1068.235 is revised to read as follows:


Sec.  1068.235  Exempting nonroad engines/equipment used solely for 
competition.

    The following provisions apply for nonroad engines/equipment, but 
not for motor vehicles or for stationary applications:
    (a) New nonroad engines/equipment you produce that are used solely 
for competition are excluded from emission standards. We may exempt 
(rather than exclude) new nonroad engines/equipment you produce that 
you intend to be used solely for competition, where we determine that 
such engines/equipment are unlikely to be used contrary to your intent. 
See the standard-setting parts for specific provisions where 
applicable. Note that the definitions in the standard-setting part may 
deem uncertified engines/equipment to be new upon importation.
    (b) If you modify any nonroad engines/equipment after they have 
been placed into service in the United States so they will be used 
solely for competition, they are exempt without request. This exemption 
applies only to the prohibitions in Sec.  1068.101(b)(1) and (2) and 
are valid only as long as the engine/equipment is used solely for 
competition. You may not use the provisions of this paragraph (b) to 
circumvent the requirements that apply to the sale of new competition 
engines under the standard-setting part.
    (c) If you modify any nonroad engines/equipment under paragraph (b) 
of this section, you must destroy the original emission labels. If you 
loan, lease, sell, or give any of these engines/equipment to someone 
else, you must tell the new owner (or operator, if applicable) in 
writing that they may be used only for competition.

0
344. Section 1068.240 is amended by revising the section heading and 
paragraphs (b)(3), (c)(1), (c)(3), (d)(2)(ii), and (e) introductory 
text to read as follows:


Sec.  1068.240  Exempting new replacement engines.

* * * * *
    (b) * * *
    (3) An old engine block replaced by a new engine exempted under 
this paragraph (b) may be reintroduced into U.S. commerce as part of an 
engine that meets either the current standards for new engines, the 
provisions for new replacement engines in this section, or another 
valid exemption. Otherwise, you must destroy the old engine block (or 
confirm that it has been destroyed), or export the engine block without 
its emission label.
* * * * *
    (c) * * *
    (1) You may produce a limited number of replacement engines under 
this paragraph (c) representing 0.5 percent of your annual production 
volumes for each category and subcategory of engines identified in 
Table 1 to this section (1.0 percent through 2013). Calculate this 
number by multiplying your annual U.S.-directed production volume by 
0.005 (or 0.01

[[Page 74228]]

through 2013) and rounding to the nearest whole number. Determine the 
appropriate production volume by identifying the highest total annual 
U.S.-directed production volume of engines from the previous three 
model years for all your certified engines from each category or 
subcategory identified in Table 1 to this section, as applicable. In 
unusual circumstances, you may ask us to base your production limits on 
U.S.-directed production volume for a model year more than three years 
prior. You may include stationary engines and exempted engines as part 
of your U.S.-directed production volume. Include U.S.-directed engines 
produced by any affiliated companies and those from any other companies 
you license to produce engines for you.
* * * * *
    (3) Send the Designated Compliance Officer a report by September 30 
of the year following any year in which you produced exempted 
replacement engines under this paragraph (c). In your report include 
the total number of replacement engines you produce under this 
paragraph (c) for each category or subcategory, as appropriate, and the 
corresponding total production volumes determined under paragraph 
(c)(1) of this section. If you send us a report under this paragraph 
(c)(3), you must also include the total number of replacement engines 
you produced under paragraphs (b), (d), and (e) of this section 
(including any replacement marine engines subject to reporting under 40 
CFR 1042.615). Count exempt engines as tracked under paragraph (b) of 
this section only if you meet all the requirements and conditions that 
apply under paragraph (b) of this section by the due date for the 
annual report. You may include the information required under this 
paragraph (c)(3) in production reports required under the standard-
setting part.
* * * * *
    (d) * * *
    (2) * * *
    (ii) If you do not qualify for using a removable label in paragraph 
(d)(2)(i) of this section, you must add a permanent label in a readily 
visible location, though it may be obscured after installation in a 
piece of equipment. Include on the permanent label your corporate name 
and trademark, the engine's part number (or other identifying 
information), and the statement: ``THIS REPLACEMENT ENGINE IS EXEMPT 
UNDER 40 CFR 1068.240. THIS ENGINE MAY NOT BE INSTALLED IN EQUIPMENT 
THAT IS MORE THAN 40 YEARS OLD AT THE TIME OF INSTALLATION.'' If there 
is not enough space for this statement, you may alternatively add: 
``REPLACEMENT'' or ``SERVICE ENGINE.'' For purposes of this paragraph 
(d)(2), engine part numbers permanently stamped or engraved on the 
engine are considered to be included on the label.
    (e) Partially complete current-tier replacement engines. The 
provisions of paragraph (d) of this section apply for engines you 
produce from a current line of certified engines or vehicles if you 
ship them as partially complete engines for replacement purposes. This 
applies for engine-based and equipment-based standards as follows:
* * * * *

0
345. Section 1068.245 is amended by revising the section heading and 
paragraph (g)(4) to read as follows:


Sec.  1068.245  Temporary provisions addressing hardship due to unusual 
circumstances.

* * * * *
    (g) * * *
    (4) A statement describing the engine's status as an exempted 
engine:
    (i) If the engine/equipment does not meet any emission standards, 
add the following statement: ``THIS [engine, equipment, vehicle, etc.] 
IS EXEMPT UNDER 40 CFR 1068.245 FROM EMISSION STANDARDS AND RELATED 
REQUIREMENTS.''
    (ii) If the engines/equipment meet alternate emission standards as 
a condition of an exemption under this section, we may specify a 
different statement to identify the alternate emission standards.

0
346. Section 1068.250 is amended by revising the section heading and 
paragraphs (c) introductory text and (k)(4) and removing and reserving 
paragraph (h).
    The revisions read as follows:


Sec.  1068.250  Extending compliance deadlines for small businesses 
under hardship.

* * * * *
    (c) Send the Designated Compliance Officer a written request for an 
extension as soon as possible before you are in violation. In your 
request, show that all the following conditions and requirements apply:
* * * * *
    (k) * * *
    (4) A statement describing the engine's status as an exempted 
engine:
    (i) If the engine/equipment does not meet any emission standards, 
add the following statement:``THIS [engine, equipment, vehicle, etc.] 
IS EXEMPT UNDER 40 CFR 1068.250 FROM EMISSION STANDARDS AND RELATED 
REQUIREMENTS.''
    (ii) If the engine/equipment meets alternate emission standards as 
a condition of an exemption under this section, we may specify a 
different statement to identify the alternate emission standards.

0
347. Section 1068.255 is amended by revising the section heading and 
paragraph (a) introductory text to read as follows:


Sec.  1068.255  Exempting engines and fuel-system components for 
hardship for equipment manufacturers and secondary engine 
manufacturers.

* * * * *
    (a) Equipment exemption. As an equipment manufacturer, you may ask 
for approval to produce exempted equipment for up to 12 months. We will 
generally limit this to a single interval up to 12 months in the first 
year that new or revised emission standards apply. Exemptions under 
this section are not limited to small businesses. Send the Designated 
Compliance Officer a written request for an exemption before you are in 
violation. In your request, you must show you are not at fault for the 
impending violation and that you would face serious economic hardship 
if we do not grant the exemption. This exemption is not available under 
this paragraph (a) if you manufacture the engine or fuel-system 
components you need for your own equipment, or if complying engines or 
fuel-system components are available from other manufacturers that 
could be used in your equipment, unless we allow it elsewhere in this 
chapter. We may impose other conditions, including provisions to use 
products meeting less stringent emission standards or to recover the 
lost environmental benefit. In determining whether to grant the 
exemptions, we will consider all relevant factors, including the 
following:
* * * * *

0
348. Section 1068.260 is revised to read as follows:


Sec.  1068.260  General provisions for selling or shipping engines that 
are not yet in their certified configuration.

    Except as specified in paragraph (e) of this section, all new 
engines in the United States are presumed to be subject to the 
prohibitions of Sec.  1068.101, which generally require that all new 
engines be in a certified configuration before being sold, offered for 
sale, or introduced or delivered into commerce in the United States or 
imported into the United States. All emission-related components 
generally need to be installed on an

[[Page 74229]]

engine for such an engine to be in its certified configuration. This 
section specifies clarifications and exemptions related to these 
requirements for engines. Except for paragraph (c) of this section, the 
provisions of this section generally apply for engine-based standards 
but not for equipment-based exhaust emission standards.
    (a) The provisions of this paragraph (a) apply for emission-related 
components that cannot practically be assembled before shipment because 
they depend on equipment design parameters.
    (1) You do not need an exemption to ship an engine that does not 
include installation or assembly of certain emission-related components 
if those components are shipped along with the engine. For example, you 
may generally ship aftertreatment devices along with engines rather 
than installing them on the engine before shipment. We may require you 
to describe how you plan to use this provision.
    (2) You may ask us at the time of certification for an exemption to 
allow you to ship your engines without emission-related components. If 
we allow this, we may specify conditions that we determine are needed 
to ensure that shipping the engine without such components will not 
result in the engine being operated outside of its certified 
configuration. You must identify unshipped parts by specific part 
numbers if they cannot be properly characterized by performance 
specification. For example, electronic control units, turbochargers, 
and EGR coolers must generally be identified by part number. Parts that 
we believe can be properly characterized by performance specification 
include air filters, noncatalyzed mufflers, and charge air coolers. See 
paragraph (d) of this section for additional provisions that apply in 
certain circumstances.
    (b) You do not need an exemption to ship engines without specific 
components if they are not emission-related components identified in 
Appendix I of this part. For example, you may generally ship engines 
without the following parts:
    (1) Radiators needed to cool the engine.
    (2) Exhaust piping between the engine and an aftertreatment device, 
between two aftertreatment devices, or downstream of the last 
aftertreatment device.
    (c) If you are a certificate holder, partially complete engines/
equipment shipped between two of your facilities are exempt, subject to 
the provisions of this paragraph (c), as long as you maintain ownership 
and control of the engines/equipment until they reach their 
destination. We may also allow this where you do not maintain actual 
ownership and control of the engines/equipment (such as hiring a 
shipping company to transport the engines) but only if you demonstrate 
that the engines/equipment will be transported only according to your 
specifications. See Sec.  1068.261(b) for the provisions that apply 
instead of this paragraph (c) for the special case of integrated 
manufacturers using the delegated-assembly exemption. Notify us of your 
intent to use this exemption in your application for certification, if 
applicable. Your exemption is effective when we grant your certificate. 
You may alternatively request an exemption in a separate submission; 
for example, this would be necessary if you will not be the certificate 
holder for the engines in question. We may require you to take specific 
steps to ensure that such engines/equipment are in a certified 
configuration before reaching the ultimate purchaser. Note that since 
this is a temporary exemption, it does not allow you to sell or 
otherwise distribute to ultimate purchasers an engine/equipment in an 
uncertified configuration with respect to exhaust emissions. Note also 
that the exempted engine/equipment remains new and subject to emission 
standards (see definition of ``exempted'' in Sec.  1068.30) until its 
title is transferred to the ultimate purchaser or it otherwise ceases 
to be new.
    (d) See Sec.  1068.261 for delegated-assembly provisions in which 
certificate-holding manufacturers ship engines that are not yet 
equipped with certain emission-related components. See Sec.  1068.262 
for provisions related to manufacturers shipping partially complete 
engines for which a secondary engine manufacturer holds the certificate 
of conformity.
    (e) Engines used in hobby vehicles are not presumed to be engines 
subject to the prohibitions of Sec.  1068.101. Hobby vehicles are 
reduced-scale models of vehicles that are not capable of transporting a 
person. Some gas turbine engines are subject to the prohibitions of 
Sec.  1068.101, but we do not presume that all gas turbine engines are 
subject to these prohibitions. Other engines that do not have a valid 
certificate of conformity or exemption when sold, offered for sale, or 
introduced or delivered into commerce in the United States or imported 
into the United States are presumed to be engines subject to the 
prohibitions of Sec.  1068.101 unless we determine that such engines 
are excluded from the prohibitions of Sec.  1068.101.
    (f) While we presume that new non-hobby engines are subject to the 
prohibitions of Sec.  1068.101, we may determine that a specific engine 
is not subject to these prohibitions based on information you provide 
or other information that is available to us. For example, the 
provisions of this part 1068 and the standard-setting parts provide for 
exemptions in certain circumstances. Also, some engines may be subject 
to separate prohibitions under subchapter C instead of the prohibitions 
of Sec.  1068.101.

0
349. Section 1068.261 is amended by revising the section heading and 
paragraph (a) to read as follows:


Sec.  1068.261   Delegated assembly and other provisions related to 
engines not yet in the certified configuration.

* * * * *
    (a) Shipping an engine separately from an aftertreatment component 
that you have specified as part of its certified configuration will not 
be a violation of the prohibitions in Sec.  1068.101(a)(1) subject to 
the provisions in this section. We may also require that you apply some 
or all of the provisions of this section for other components if we 
determine it is necessary to ensure that shipping the engine without 
such components will not result in the engine being operated outside of 
its certified configuration. In making this determination, we will 
consider the importance of the component for controlling emissions and 
the likelihood that equipment manufacturers will have an incentive to 
disregard your emission-related installation instructions based on any 
relevant factors, such as the cost of the component and any real or 
perceived expectation of a negative impact on engine or equipment 
performance.
* * * * *

0
350. Section 1068.262 is revised to read as follows:


Sec.  1068.262  Shipment of engines to secondary engine manufacturers.

    This section specifies how manufacturers may introduce into U.S. 
commerce partially complete engines that have an exemption or a 
certificate of conformity held by a secondary engine manufacturer and 
are not yet in a certified configuration. See the standard-setting part 
to determine whether and how the provisions of this section apply. 
(Note: See Sec.  1068.261 for provisions related to manufacturers 
introducing into U.S. commerce partially complete engines for which 
they hold the certificate of conformity.) This exemption is temporary 
as

[[Page 74230]]

described in paragraph (g) of this section.
    (a) The provisions of this section generally apply where the 
secondary engine manufacturer has substantial control over the design 
and assembly of emission controls. In unusual circumstances we may 
allow other secondary engine manufacturers to use these provisions. In 
determining whether a manufacturer has substantial control over the 
design and assembly of emission controls, we would consider the degree 
to which the secondary engine manufacturer would be able to ensure that 
the engine will conform to the regulations in its final configuration. 
Such secondary engine manufacturers may finish assembly of partially 
complete engines in the following cases:
    (1) You obtain an engine that is not fully assembled with the 
intent to manufacture a complete engine.
    (2) You obtain an engine with the intent to modify it before it 
reaches the ultimate purchaser.
    (3) You obtain an engine with the intent to install it in equipment 
that will be subject to equipment-based standards.
    (b) Manufacturers may introduce into U.S. commerce partially 
complete engines as described in this section if they have a written 
request for such engines from a secondary engine manufacturer that has 
certified the engine and will finish the engine assembly. The written 
request must include a statement that the secondary engine manufacturer 
has a certificate of conformity for the engine and identify a valid 
engine family name associated with each engine model ordered (or the 
basis for an exemption if applicable, as specified in paragraph (e) of 
this section). The original engine manufacturer must apply a removable 
label meeting the requirements of Sec.  1068.45 that identifies the 
corporate name of the original manufacturer and states that the engine 
is exempt under the provisions of Sec.  1068.262. The name of the 
certifying manufacturer must also be on the label or, alternatively, on 
the bill of lading that accompanies the engines during shipment. The 
original engine manufacturer may not apply a permanent emission control 
information label identifying the engine's eventual status as a 
certified engine.
    (c) If you are the secondary engine manufacturer and you will hold 
the certificate, you must include the following information in your 
application for certification:
    (1) Identify the original engine manufacturer of the partially 
complete engine or of the complete engine you will modify.
    (2) Describe briefly how and where final assembly will be 
completed. Specify how you have the ability to ensure that the engines 
will conform to the regulations in their final configuration. (Note: 
Paragraph (a) of this section prohibits using the provisions of this 
section unless you have substantial control over the design and 
assembly of emission controls.)
    (3) State unconditionally that you will not distribute the engines 
without conforming to all applicable regulations.
    (d) If you are a secondary engine manufacturer and you are already 
a certificate holder for other families, you may receive shipment of 
partially complete engines after you apply for a certificate of 
conformity but before the certificate's effective date. In this case, 
all the provisions of Sec.  1068.103(c)(1) through (3) apply. This 
exemption allows the original manufacturer to ship engines after you 
have applied for a certificate of conformity. Manufacturers may 
introduce into U.S. commerce partially complete engines as described in 
this paragraph (d) if they have a written request for such engines from 
a secondary engine manufacturer stating that the application for 
certification has been submitted (instead of the information we specify 
in paragraph (b) of this section). We may set additional conditions 
under this paragraph (d) to prevent circumvention of regulatory 
requirements. Consistent with Sec.  1068.103(c), we may also revoke an 
exemption under this paragraph (d) if we have reason to believe that 
the application for certification will not be approved or that the 
engines will otherwise not reach a certified configuration before 
reaching the ultimate purchaser. This may require that you export the 
engines.
    (e) The provisions of this section also apply for shipping 
partially complete engines if the engine is covered by a valid 
exemption and there is no valid engine family name that could be used 
to represent the engine model. Unless we approve otherwise in advance, 
you may do this only when shipping engines to secondary engine 
manufacturers that are certificate holders. In this case, the secondary 
engine manufacturer must identify the regulatory cite identifying the 
applicable exemption instead of a valid engine family name when 
ordering engines from the original engine manufacturer.
    (f) If secondary engine manufacturers determine after receiving an 
engine under this section that the engine will not be covered by a 
certificate or exemption as planned, they may ask us to allow for 
shipment of the engines back to the original engine manufacturer or to 
another secondary engine manufacturer. This might occur in the case of 
an incorrect shipment or excess inventory. We may modify the provisions 
of this section as appropriate to address these cases.
    (g) Both original and secondary engine manufacturers must keep the 
records described in this section for at least five years, including 
the written request for engines and the bill of lading for each 
shipment (if applicable). The written request is deemed to be a 
submission to EPA and is thus subject to the reporting requirements of 
Sec.  1068.101(a)(2).
    (h) These provisions are intended only to allow secondary engine 
manufacturers to obtain or transport engines in the specific 
circumstances identified in this section so any exemption under this 
section expires when the engine reaches the point of final assembly 
identified in paragraph (c)(2) of this section.
    (i) For purposes of this section, an allowance to introduce 
partially complete engines into U.S. commerce includes a conditional 
allowance to sell, introduce, or deliver such engines into commerce in 
the United States or import them into the United States. It does not 
include a general allowance to offer such partially complete engines 
for sale because this exemption is intended to apply only for cases in 
which the certificate holder already has an arrangement to purchase the 
engines from the original engine manufacturer. This exemption does not 
allow the original engine manufacturer to subsequently offer the 
engines for sale to a different manufacturer who will hold the 
certificate unless that second manufacturer has also complied with the 
requirements of this part. The exemption does not apply for any 
individual engines that are not labeled as specified in this section or 
which are shipped to someone who is not a certificate holder.
    (j) We may suspend, revoke, or void an exemption under this 
section, as follows:
    (1) We may suspend or revoke your exemption if you fail to meet the 
requirements of this section. We may suspend or revoke an exemption 
related to a specific secondary engine manufacturer if that 
manufacturer sells engines that are in not in a certified configuration 
in violation of the regulations. We may disallow this exemption for 
future shipments to the affected secondary engine manufacturer or set 
additional conditions to ensure that engines will be assembled in the 
certified configuration.

[[Page 74231]]

    (2) We may void an exemption for all the affected engines if you 
intentionally submit false or incomplete information or fail to keep 
and provide to EPA the records required by this section.
    (3) The exemption is void for an engine that is shipped to a 
company that is not a certificate holder or for an engine that is 
shipped to a secondary engine manufacturer that is not in compliance 
with the requirements of this section.
    (4) The secondary engine manufacturer may be liable for causing a 
prohibited act if voiding the exemption is due to its own actions.
    (k) No exemption is needed to import equipment that does not 
include an engine. No exemption from exhaust emission standards is 
available under this section for equipment subject to equipment-based 
standards if the engine has been installed.

0
351. Section 1068.265 is amended by revising the section heading to 
read as follows:


Sec.  1068.265  Provisions for engines/equipment conditionally exempted 
from certification.

* * * * *

Subpart D--Imports

0
352. Section 1068.301 is amended by revising the section heading and 
paragraphs (b) and (d) and adding paragraph (e) to read as follows:


Sec.  1068.301  General provisions for importing engines/equipment.

* * * * *
    (b) In general, engines/equipment that you import must be covered 
by a certificate of conformity unless they were built before emission 
standards started to apply. This subpart describes the limited cases 
where we allow importation of exempt or excluded engines/equipment. If 
an engine has an exemption from exhaust emission standards, this allows 
you to import the equipment under the same exemption.
* * * * *
    (d) Complete the appropriate EPA declaration before importing any 
engines or equipment. These forms may be submitted and stored 
electronically and are available on the Internet at http://www.epa.gov/OTAQ/imports/ or by phone at 734-214-4100. Importers must keep these 
records for five years and make them available promptly upon request.
    (e) The standard-setting part may define uncertified engines/
equipment to be ``new'' upon importation, whether or not they have 
already been placed into service. This may affect how the provisions of 
this subpart apply for your engines/equipment. (See the definition of 
``new'' and other relevant terms in the standard-setting part.)

0
353. Section 1068.305 is amended by revising paragraphs (b)(1) and (2) 
to read as follows:


Sec.  1068.305  How do I get an exemption or exclusion for imported 
engines/equipment?

* * * * *
    (b) * * *
    (1) Give your name, address, and telephone number.
    (2) Give the engine/equipment owner's name, address, and telephone 
number.
* * * * *

0
354. Section 1068.310 is amended by revising the section heading and 
paragraph (a) to read as follows:


Sec.  1068.310  Exclusions for imported engines/equipment.

* * * * *
    (a) Nonroad engines/equipment used solely for competition. Nonroad 
engines/equipment that you demonstrate will be used solely for 
competition are excluded from the restrictions on imports in Sec.  
1068.301(b), but only if they are properly labeled. See the standard-
setting part for provisions related to this demonstration that may 
apply. Section 1068.101(b)(4) prohibits anyone from using these 
excluded engines/equipment for purposes other than competition. We may 
waive the labeling requirement or allow a removable label for engines/
equipment that are being temporarily imported for one or more specific 
competition events.
* * * * *

0
355. Section 1068.315 is amended by revising the section heading and 
paragraph (i) to read as follows:


Sec.  1068.315  Permanent exemptions for imported engines/equipment.

* * * * *
    (i) Ancient engine/equipment exemption. If you are not the original 
engine/equipment manufacturer, you may import nonconforming engines/
equipment that are subject to a standard-setting part and were first 
manufactured at least 21 years earlier, as long as they are still 
substantially in their original configurations.

0
356. Section 1068.325 is amended by revising the section heading, 
introductory text, and paragraphs (a), (c), (d), and (j)(5) to read as 
follows:


Sec.  1068.325  Temporary exemptions for imported engines/equipment.

    You may import engines/equipment under certain temporary 
exemptions, subject to the conditions in this section. We may ask U.S. 
Customs and Border Protection to require a specific bond amount to make 
sure you comply with the requirements of this subpart. You may not sell 
or lease one of these engines/equipment while it is in the United 
States except as specified in this section or Sec.  1068.201(i). You 
must eventually export the engine/equipment as we describe in this 
section unless it conforms to a certificate of conformity or it 
qualifies for one of the permanent exemptions in Sec.  1068.315 or the 
standard-setting part.
    (a) Exemption for repairs or alterations. You may temporarily 
import nonconforming engines/equipment under bond solely for repair or 
alteration, subject to our advance approval as described in paragraph 
(j) of this section. You may operate the engine/equipment in the United 
States only as necessary to repair it, alter it, or ship it to or from 
the service location. Export the engine/equipment directly after 
servicing is complete, or confirm that it has been destroyed.
* * * * *
    (c) Display exemption. You may temporarily import nonconforming 
engines/equipment under bond for display if you follow the requirements 
of Sec.  1068.220, subject to our advance approval as described in 
paragraph (j) of this section. This exemption expires one year after 
you import the engine/equipment, unless we approve your request for an 
extension. The engine/equipment must be exported (or destroyed) by the 
time the exemption expires or directly after the display concludes, 
whichever comes first.
    (d) Export exemption. You may temporarily import nonconforming 
engines/equipment to export them, as described in Sec.  1068.230. Label 
the engine/equipment as described in Sec.  1068.230. You may sell or 
lease the engines/equipment for operation outside the United States 
consistent with the provisions of Sec.  1068.230.
* * * * *
    (j) * * *
    (5) Acknowledge that EPA enforcement officers may conduct 
inspections or testing as allowed under the Clean Air Act.
* * * * *

0
357. Section 1068.335 is amended by revising the section heading to 
read as follows:


Sec.  1068.335  Penalties for violations.

* * * * *

0
358. Section 1068.360 is amended by revising the section heading and 
paragraph (b) to read as follows:

[[Page 74232]]

Sec.  1068.360  Restrictions for assigning a model year to imported 
engines and equipment.

* * * * *
    (b) This paragraph (b) applies for the importation of engines and 
equipment that have not been placed into service, where the importation 
occurs in any calendar year that is more than one year after the named 
model year of the engine or equipment when emission control 
requirements applying to current engines are different than for engines 
or equipment in the named model year, unless they are imported under 
special provisions for Independent Commercial Importers as allowed 
under the standard-setting part. Regardless of what other provisions of 
this subchapter U specify for the model year of the engine or 
equipment, such engines and equipment are deemed to have an applicable 
model year no more than one year earlier than the calendar year in 
which they are imported. For example, a new engine identified as a 2007 
model-year product that is imported on January 31, 2010 will be treated 
as a 2009 model-year engine; the same engine will be treated as a 2010 
model-year engine if it is imported any time in calendar year 2011.
* * * * *

Subpart E--Selective Enforcement Auditing

0
359. Section 1068.401 is revised to read as follows:


Sec.  1068.401  What is a selective enforcement audit?

    (a) We may conduct or require you as a certificate holder to 
conduct emission tests on production engines/equipment in a selective 
enforcement audit. This requirement is independent of any requirement 
for you to routinely test production-line engines/equipment. Where 
there are multiple entities meeting the definition of manufacturer, we 
may require manufacturers other than the certificate holder to conduct 
or participate in the audit as necessary. For products subject to 
equipment-based standards, but tested using engine-based test 
procedures, this subpart applies to the engines and/or the equipment, 
as applicable. Otherwise this subpart applies to engines for products 
subject to engine-based standards and to equipment for products subject 
to equipment-based standards.
    (b) If we send you a signed test order, you must follow its 
directions and the provisions of this subpart. We may tell you where to 
test the engines/equipment. This may be where you produce the engines/
equipment or any other emission testing facility. You are responsible 
for all testing costs whether the testing is conducted at your facility 
or another facility.
    (c) If we select one or more of your families for a selective 
enforcement audit, we will send the test order to the person who signed 
the application for certification or we will deliver it in person.
    (d) If we do not select a testing facility, notify the Designated 
Compliance Officer within one working day of receiving the test order 
where you will test your engines/equipment.
    (e) You must do everything we require in the audit without delay. 
We may suspend or revoke your certificate of conformity for the 
affected engine families if you do not fulfill your obligations under 
this subpart.

0
360. Section 1068.405 is amended by revising paragraph (a)(1) to read 
as follows:


Sec.  1068.405  What is in a test order?

    (a) * * *
    (1) The family we have identified for testing. We may also specify 
individual configurations.
* * * * *

0
361. Section 1068.415 is amended by revising paragraphs (c) and (d) to 
read as follows:


Sec.  1068.415  How do I test my engines/equipment?

* * * * *
    (c) Test at least two engines/equipment in each 24-hour period 
(including void tests). However, for engines with maximum engine power 
above 560 kW, you may test one engine per 24-hour period. If you 
request and justify it, we may approve a lower testing rate.
    (d) For exhaust emissions, accumulate service on test engines/
equipment at a minimum rate of 6 hours per engine or piece of equipment 
during each 24-hour period; however, service accumulation to stabilize 
an engine's emission levels may not take longer than eight days. The 
first 24-hour period for service accumulation begins when you finish 
preparing an engine or piece of equipment for testing. The minimum 
service accumulation rate does not apply on weekends or holidays. We 
may approve a longer stabilization period or a lower service 
accumulation rate if you request and justify it. We may require you to 
accumulate hours more rapidly than the minimum rate, as appropriate. 
Plan your service accumulation to allow testing at the rate specified 
in paragraph (c) of this section. Select operation for accumulating 
operating hours on your test engines/equipment to represent normal in-
use operation for the family.
* * * * *

0
362. Section 1068.420 is amended by revising paragraphs (b) and (e) to 
read as follows:


Sec.  1068.420  How do I know when my engine family fails an SEA?

* * * * *
    (b) Continue testing engines/equipment until you reach a pass 
decision for all pollutants or a fail decision for one pollutant, as 
described in paragraph (c) of this section.
* * * * *
    (e) If you reach a pass decision for one pollutant, but need to 
continue testing for another pollutant, we will not use these later 
test results for the pollutant with the pass decision as part of the 
SEA.
* * * * *

0
363. Section 1068.425 is amended by revising paragraph (b) to read as 
follows:


Sec.  1068.425  What happens if one of my production-line engines/
equipment exceeds the emission standards?

* * * * *
    (b) You may ask for a hearing relative to the suspended certificate 
of conformity for the failing engine/equipment as specified in subpart 
G of this part.

0
364. Section 1068.430 is amended by revising paragraph (c) to read as 
follows:


Sec.  1068.430  What happens if a family fails an SEA?

* * * * *
    (c) You may ask for a hearing as described in subpart G of this 
part up to 15 days after we suspend the certificate for a family. If we 
agree that we used erroneous information in deciding to suspend the 
certificate before a hearing is held, we will reinstate the 
certificate.

0
365. Section 1068.450 is amended by revising paragraph (b) to read as 
follows:


Sec.  1068.450  What records must I send to EPA?

* * * * *
    (b) We may ask you to add information to your written report, so we 
can determine whether your new engines/equipment conform to the 
requirements of this subpart.
* * * * *

Subpart F--Reporting Defects and Recalling Engines/Equipment

0
366. Section 1068.501 is amended by revising paragraphs (a)(1)(iv), 
(a)(8), and (b)(1)(iii) to read as follows:

[[Page 74233]]

Sec.  1068.501  How do I report emission-related defects?

* * * * *
    (a) * * *
    (1) * * *
    (iv) Any other component whose failure would commonly increase 
emissions of any regulated pollutant without significantly degrading 
engine/equipment performance.
* * * * *
    (8) Send all reports required by this section to the Designated 
Compliance Officer.
* * * * *
    (b) * * *
    (1) * * *
    (iii) You receive any other information for which good engineering 
judgment would indicate the component or system may be defective, such 
as information from dealers, field-service personnel, equipment 
manufacturers, hotline complaints, in-use testing, or engine diagnostic 
systems.
* * * * *

0
367. Section 1068.505 is amended by revising paragraphs (a), (c), and 
(g) to read as follows:


Sec.  1068.505  How does the recall program work?

    (a) If we make a determination that a substantial number of 
properly maintained and used engines/equipment within a given class or 
category do not conform to the regulations of this chapter during their 
useful life, you must submit a plan to remedy the nonconformity of your 
engines/equipment. We will notify you of our determination in writing. 
Our notice will identify the class or category of engines/equipment 
affected and describe how we reached our conclusion. If this happens, 
you must meet the requirements and follow the instructions in this 
subpart. You must remedy at your expense all engines/equipment that 
experienced the nonconformity during the useful life in spite of being 
properly maintained and used, as described in Sec.  1068.510(a)(7), 
regardless of their age or extent of service accumulation at the time 
of repair. You may not transfer this expense to a dealer (or equipment 
manufacturer for engine-based standards) through a franchise or other 
agreement.
* * * * *
    (c) Unless we withdraw the determination of noncompliance, you must 
respond to it by sending a remedial plan to the Designated Compliance 
Officer. We will designate a date by which you must send us the 
remedial plan; the designated date will be no sooner than 45 days after 
we notify you, and no sooner than 30 days after a hearing.
* * * * *
    (g) For purposes of recall, ``owner'' means someone who owns an 
engine or piece of equipment affected by a remedial plan.

0
368. Section 1068.510 is amended by revising paragraphs (a)(6), (b), 
and (h) to read as follows:


Sec.  1068.510  How do I prepare and apply my remedial plan?

    (a) * * *
    (6) How you will notify owners; include a copy of any notification 
letters.
* * * * *
    (b) We may require you to add information if it is needed to 
evaluate your remedial plan.
* * * * *
    (h) Begin notifying owners within 15 days after we approve your 
remedial plan. If we hold a hearing, but do not change our position 
about the noncompliance, you must begin notifying owners within 60 days 
after we complete the hearing unless we specify a later deadline.

0
369. Section 1068.515 is amended by revising paragraphs (a) and (c) to 
read as follows:


Sec.  1068.515  How do I mark or label repaired engines/equipment?

    (a) Attach a label to engines/equipment you repair under the 
remedial plan. At your discretion, you may label or mark engines/
equipment you inspect but do not repair. Designate the specific recall 
campaign on the label.
* * * * *
    (c) Identify the facility where you repaired or inspected the 
engine/equipment on the label, or keep records of this information for 
each vehicle and give it to us if we ask for it.
* * * * *

0
370. Section 1068.520 is amended by revising paragraph (b) to read as 
follows:


Sec.  1068.520   How do I notify affected owners?

* * * * *
    (b) We may require you to add information to your notice or to send 
more notices if we determine this is reasonable and necessary to ensure 
an effective recall.
* * * * *

0
371. Section 1068.530 is amended by revising the introductory text to 
read as follows:


Sec.  1068.530  What records must I keep?

    We may review your records at any time so it is important that you 
keep required information readily available. Keep records associated 
with your recall campaign for five years after you send the last report 
we require under Sec.  1068.525(b). Organize and maintain your records 
as described in this section.
* * * * *

0
372. Subpart G is revised to read as follows:
Subpart G--Hearings
Sec.
1068.601 Overview.
1068.610 Request for hearing--suspending, revoking, or voiding a 
certificate of conformity.
1068.615 Request for hearing--denied application for certification, 
automatically suspended certificate, and determinations related to 
certification.
1068.620 Request for hearing--recall.
1068.625 Request for hearing--nonconformance penalties.
1068.650 Procedures for informal hearings.

Subpart G--Hearings


Sec.  1068.601  Overview.

    The regulations of this chapter involve numerous provisions that 
may result in EPA making a decision or judgment that you may consider 
adverse to your interests and that either limits your business 
activities or requires you to pay penalties. As specified in the 
regulations in this chapter, this might involve an opportunity for an 
informal hearing or a formal hearing that follows specific procedures 
and is directed by a Presiding Officer. The regulations in this chapter 
generally specify when we would hold a hearing. In limited 
circumstances, we may grant a request for a hearing related to adverse 
decisions regarding regulatory provisions for which we do not 
specifically describe the possibility of asking for a hearing.
    (a) If you request a hearing regarding our decision to assess 
administrative penalties under Sec.  1068.125, we will hold a formal 
hearing according to the provisions of 40 CFR 22.1 through 22.32 and 
22.34.
    (b) For other issues where the regulation allows for a hearing in 
response to an adverse decision, you may request an informal hearing as 
described in Sec.  1068.650. Sections 1068.610 through 1068.625 
describe when and how to request an informal hearing under various 
circumstances.
    (c) The time limits we specify are calendar days and include 
weekends and holidays, except that a deadline falling on a Saturday, 
Sunday, or a

[[Page 74234]]

federal holiday is understood to move to the next business day. Your 
filing will be considered timely based on the following criteria 
relative to the specified deadline:
    (1) The postmarked date for items sent by U.S. mail must be on or 
before the specified date.
    (2) The ship date for items sent from any location within the 
United States by commercial carriers must be on or before the specified 
date.
    (3) Items sent by mail or courier from outside the United States 
must be received by the specified date.
    (4) The time and date stamp on an email message must be at or 
before 5:00 p.m. on the specified date (in either the source or 
destination time zone).
    (5) The time and date stamp on faxed pages must be at or before 
5:00 p.m. on the specified date (in either the source or destination 
time zone).
    (6) Hand-delivered items must be received by the appropriate 
personnel by 3:00 p.m. on the specified date.
    (d) See the standard-setting part for additional information. If 
the standard-setting part specifies any provisions that are contrary to 
those described in this subpart, the provisions of the standard-setting 
part apply instead of those described in this subpart.


Sec.  1068.610  Request for hearing--suspending, revoking, or voiding a 
certificate of conformity.

    (a) You may request an informal hearing as described in Sec.  
1068.650 if you disagree with our decision to suspend, revoke, or void 
a certificate of conformity.
    (b) If you request a hearing regarding the outcome of a testing 
regimen with established evaluation criteria, such as selective 
enforcement audits or routine production-line testing, we will hold a 
hearing limited to the following issues that are relevant to your 
circumstances:
    (1) Whether tests were conducted in accordance with applicable 
regulations.
    (2) Whether test equipment was properly calibrated and functioning.
    (3) Whether specified sampling procedures were followed to select 
engines/equipment for testing.
    (4) Whether there is a basis for determining that the problems 
identified do not apply for engines/equipment produced at plants other 
than the one from which engines/equipment were selected for testing.
    (c) You must send your hearing request in writing to the Designated 
Compliance Officer no later than 30 days after we notify you of our 
decision to suspend, revoke, or void your certificate, or by some later 
deadline we specify. If the deadline passes, we may nevertheless grant 
you a hearing at our discretion.
    (d) Your hearing request must include the following information:
    (1) Identify the classes or categories of engines/equipment that 
will be the subject of the hearing.
    (2) State briefly which issues you will raise at the hearing for 
each affected class or category of engines/equipment.
    (3) Specify why you believe the hearing will conclude in your favor 
for each of the issues you will raise.
    (4) Summarize the evidence supporting your position on each of the 
issues you will raise and include any supporting data.
    (e) We will approve your request for an informal hearing if we find 
that your request raises a substantial factual issue in the decision we 
made that, if addressed differently, could alter the outcome of that 
decision.


Sec.  1068.615  Request for hearing--denied application for 
certification, automatically suspended certificate, and determinations 
related to certification.

    (a) You may request an informal hearing as described in Sec.  
1068.650 if we deny your application for a certificate of conformity, 
if your certificate of conformity is automatically suspended under the 
regulations, or if you disagree with determinations we make as part of 
the certification process. For example, you might disagree with our 
determinations regarding adjustable parameters under Sec.  1068.50 or 
regarding your good engineering judgment under Sec.  1068.5.
    (b) You must send your hearing request in writing to the Designated 
Compliance Officer no later than 30 days after we notify you of our 
decision, or by some later deadline we specify. If the specified 
deadline passes, we may nevertheless grant you a hearing at our 
discretion.
    (c) Your hearing request must include the information specified in 
Sec.  1068.610(d).
    (d) We will approve your request for an informal hearing if we find 
that your request raises a substantial factual issue in the decision we 
made that, if addressed differently, could alter the outcome of that 
decision.


Sec.  1068.620  Request for hearing--recall.

    (a) You may request an informal hearing as described in Sec.  
1068.650 if you disagree with our decision to order a recall.
    (b) You must send your hearing request in writing to the Designated 
Compliance Officer no later than 45 days after we notify you of our 
decision, or by some later deadline we specify. If the specified 
deadline passes, we may nevertheless grant you a hearing at our 
discretion.
    (c) Your hearing request must include the information specified in 
Sec.  1068.610(d).
    (d) We will approve your request for an informal hearing if we find 
that your request raises a substantial factual issue in the decision we 
made that, if addressed differently, could alter the outcome of that 
decision.


Sec.  1068.625  Request for hearing--nonconformance penalties.

    (a) You may request an informal hearing as described in Sec.  
1068.650 if you disagree with our determination of compliance level or 
penalty calculation or both. The hearing will address only whether the 
compliance level or penalty was determined in accordance with the 
regulations.
    (b) Send a request for a hearing in writing to the Designated 
Compliance Officer within the following time frame, as applicable:
    (1) No later than 15 days after we notify you that we have approved 
a nonconformance penalty under this subpart if the compliance level is 
in the allowable range of nonconformity.
    (2) No later than 15 days after completion of the Production 
Compliance Audit if the compliance level exceeds the upper limit.
    (3) No later than 15 days after we notify you of an adverse 
decision for all other cases.
    (c) If you miss the specified deadline in paragraph (b) of this 
section, we may nevertheless grant youa hearing at our discretion.
    (d) Your hearing request must include the information specified in 
Sec.  1068.610(d).
    (e) We will approve your request for an informal hearing if we find 
that your request raises a substantial factual issue in the decision we 
made that, if addressed differently, could alter the outcome of that 
decision.


Sec.  1068.650  Procedures for informal hearings.

    (a) The following provisions apply for arranging the hearing:
    (1) After granting your request for an informal hearing, we will 
designate a Presiding Officer for the hearing.
    (2) The Presiding Officer will select the time and place for the 
hearing. The hearing must be held as soon as practicable for all 
parties involved.
    (3) The Presiding Officer may require that all argument and 
presentation of evidence be concluded by a certain date after 
commencement of the hearing.
    (b) The Presiding Officer will establish a paper or electronic 
hearing

[[Page 74235]]

record, which may be made available for inspection. The hearing record 
includes, but is not limited to, the following materials:
    (1) All documents relating to the application for certification, 
including the certificate of conformity itself, if applicable.
    (2) Your request for a hearing and the accompanying supporting 
data.
    (3) Correspondence and other data relevant to the hearing.
    (4) The Presiding Officer's written decision regarding the subject 
of the hearing, together with any accompanying material.
    (c) You may appear in person or you may be represented by counsel 
or by any other representative you designate.
    (d) The Presiding Officer may arrange for a prehearing conference, 
either in response to a request from any party or at his or her own 
discretion. The Presiding Officer will select the time and place for 
the prehearing conference. The Presiding Officer will summarize the 
results of the conference and include the written summary as part of 
the record. The prehearing conference may involve consideration of the 
following items:
    (1) Simplification of the issues.
    (2) Stipulations, admissions of fact, and the introduction of 
documents.
    (3) Limitation of the number of expert witnesses.
    (4) Possibility of reaching an agreement to resolve any or all of 
the issues in dispute.
    (5) Any other matters that may aid in expeditiously and 
successfully concluding the hearing.
    (e) Hearings will be conducted as follows:
    (1) The Presiding Officer will conduct informal hearings in an 
orderly and expeditious manner. The parties may offer oral or written 
evidence; however, the Presiding Officer may exclude evidence that is 
irrelevant, immaterial, or repetitious.
    (2) Witnesses will not be required to testify under oath; however, 
the Presiding Officer must make clear that 18 U.S.C. 1001 specifies 
civil and criminal penalties for knowingly making false statements or 
representations or using false documents in any matter within the 
jurisdiction of EPA or any other department or agency of the United 
States.
    (3) Any witness may be examined or cross-examined by the Presiding 
Officer, by you, or by any other parties.
    (4) Written transcripts must be made for all hearings. Anyone may 
purchase copies of transcripts from the reporter.
    (f) The Presiding Officer will make a final decision with written 
findings, conclusions and supporting rationale on all the substantial 
factual issues presented in the record. The findings, conclusions, and 
written decision must be provided to the parties and made a part of the 
record.

0
373. Appendix I to part 1068 is amended by revising paragraph IV to 
read as follows:

Appendix I to Part 1068--Emission-Related Components

* * * * *
    IV. Emission-related components also include any other part 
whose primary purpose is to reduce emissions or whose failure would 
commonly increase emissions without significantly degrading engine/
equipment performance.

Department of Transportation

National Highway Traffic Safety Administration

49 CFR Chapter V

    In consideration of the foregoing, under the authority of 49 U.S.C. 
322, 5 U.S.C. 552, 49 U.S.C. 30166, 49 U.S.C. 30167, 49 U.S.C. 32307, 
49 U.S.C. 32505, 49 U.S.C. 32708, 49 U.S.C. 32910, 49 U.S.C. 33116, 49 
U.S.C. 32901, 49 U.S.C. 32902, 49 U.S.C. 30101, 49 U.S.C. 32905, 49 
U.S.C. 32906, and delegation of authority at 49 CFR 1.95, NHTSA amends 
49 CFR chapter V as follows:

PART 523--VEHICLE CLASSIFICATION

0
374. Revise the authority citation for part 523 to read as follows:

    Authority: 49 U.S.C. 32901; delegation of authority at 49 CFR 
1.95.


0
375. Revise Sec.  523.2 to read as follows:


Sec.  523.2   Definitions.

    As used in this part:
    Ambulance has the meaning given in 40 CFR 86.1803.
    Approach angle means the smallest angle, in a plane side view of an 
automobile, formed by the level surface on which the automobile is 
standing and a line tangent to the front tire static loaded radius arc 
and touching the underside of the automobile forward of the front tire.
    Axle clearance means the vertical distance from the level surface 
on which an automobile is standing to the lowest point on the axle 
differential of the automobile.
    Base tire (for passenger automobiles, light trucks, and medium duty 
passenger vehicles) means the tire size specified as standard equipment 
by the manufacturer on each unique combination of a vehicle's footprint 
and model type. Standard equipment is defined in 40 CFR 86.1803.
    Basic vehicle frontal area is used as defined in 40 CFR 86.1803 for 
passenger automobiles, light trucks, medium duty passenger vehicles and 
Class 2b through 3 pickup trucks and vans. For heavy-duty tracts and 
vocational vehicles, it has the meaning given in 40 CFR 1037.801.
    Breakover angle means the supplement of the largest angle, in the 
plan side view of an automobile that can be formed by two lines tangent 
to the front and rear static loaded radii arcs and intersecting at a 
point on the underside of the automobile.
    Bus has the meaning given in 49 CFR 571.3.
    Cab-complete vehicle means a vehicle that is first sold as an 
incomplete vehicle that substantially includes the vehicle cab section 
as defined in 40 CFR 1037.801. For example, vehicles known commercially 
as chassis-cabs, cab-chassis, box-deletes, bed-deletes, and cut-away 
vans are considered cab-complete vehicles. A cab includes a steering 
column and a passenger compartment. Note that a vehicle lacking some 
components of the cab is a cab-complete vehicle if it substantially 
includes the cab.
    Cargo-carrying volume means the luggage capacity or cargo volume 
index, as appropriate, and as those terms are defined in 40 CFR 
600.315-08, in the case of automobiles to which either of these terms 
apply. With respect to automobiles to which neither of these terms 
apply, ``cargo-carrying volume'' means the total volume in cubic feet, 
rounded to the nearest 0.1 cubic feet, of either an automobile's 
enclosed nonseating space that is intended primarily for carrying cargo 
and is not accessible from the passenger compartment, or the space 
intended primarily for carrying cargo bounded in the front by a 
vertical plane that is perpendicular to the longitudinal centerline of 
the automobile and passes through the rearmost point on the rearmost 
seat and elsewhere by the automobile's interior surfaces.
    Class 2b vehicles are vehicles with a gross vehicle weight rating 
(GVWR) ranging from 8,501 to 10,000 pounds.
    Class 3 through Class 8 vehicles are vehicles with a gross vehicle 
weight rating (GVWR) of 10,001 pounds or more as defined in 49 CFR 
565.15.
    Coach bus has the meaning given in 40 CFR 1037.801.
    Commercial medium- and heavy-duty on-highway vehicle means an on-
highway vehicle with a gross vehicle weight rating of 10,000 pounds or 
more as defined in 49 U.S.C. 32901(a)(7).

[[Page 74236]]

    Complete vehicle has the meaning given to completed vehicle as 
defined in 49 CFR 567.3.
    Concrete mixer has the meaning given in 40 CFR 1037.801.
    Curb weight has the meaning given in 49 CFR 571.3.
    Dedicated vehicle has the same meaning as dedicated automobile as 
defined in 49 U.S.C. 32901(a)(8).
    Departure angle means the smallest angle, in a plane side view of 
an automobile, formed by the level surface on which the automobile is 
standing and a line tangent to the rear tire static loaded radius arc 
and touching the underside of the automobile rearward of the rear tire.
    Dual-fueled vehicle (multi-fuel, or flexible-fuel vehicle) has the 
same meaning as dual fueled automobile as defined in 49 U.S.C. 
32901(a)(9).
    Electric vehicle means a vehicle that does not include an engine, 
and is powered solely by an external source of electricity and/or solar 
power. Note that this does not include electric hybrid or fuel-cell 
vehicles that use a chemical fuel such as gasoline, diesel fuel, or 
hydrogen. Electric vehicles may also be referred to as all-electric 
vehicles to distinguish them from hybrid vehicles.
    Emergency vehicle means one of the following:
    (1) For passenger cars, light trucks and medium duty passenger 
vehicles, emergency vehicle has the meaning given in 49 U.S.C. 
32902(e).
    (2) For heavy-duty vehicles, emergency vehicle has the meaning 
given in 40 CFR 1037.801.
    Engine code has the meaning given in 40 CFR 86.1803.
    Final stage manufacturer has the meaning given in 49 CFR 567.3.
    Fire truck has the meaning given in 40 CFR 86.1803.
    Footprint is defined as the product of track width (measured in 
inches, calculated as the average of front and rear track widths, and 
rounded to the nearest tenth of an inch) times wheelbase (measured in 
inches and rounded to the nearest tenth of an inch), divided by 144 and 
then rounded to the nearest tenth of a square foot. For purposes of 
this definition, track width is the lateral distance between the 
centerlines of the base tires at ground, including the camber angle. 
For purposes of this definition, wheelbase is the longitudinal distance 
between front and rear wheel centerlines.
    Full-size pickup truck means a light truck or medium duty passenger 
vehicle that meets the requirements specified in 40 CFR 86.1866-12(e).
    Gross axle weight rating (GAWR) has the meaning given in 49 CFR 
571.3.
    Gross combination weight rating (GCWR) has the meaning given in 49 
CFR 571.3.
    Gross vehicle weight rating (GVWR) has the meaning given in 49 CFR 
571.3.
    Heavy-duty engine means any engine used for (or for which the 
engine manufacturer could reasonably expect to be used for) motive 
power in a heavy-duty vehicle. For purposes of this definition in this 
part, the term ``engine'' includes internal combustion engines and 
other devices that convert chemical fuel into motive power. For 
example, a fuel cell and motor used in a heavy-duty vehicle is a heavy-
duty engine. Heavy duty-engines include those engines subject to the 
standards in 49 CFR part 535.
    Heavy-duty vehicle means a vehicle as defined in Sec.  523.6.
    Hitch means a device attached to the chassis of a vehicle for 
towing.
    Incomplete vehicle has the meaning given in 49 CFR 567.3.
    Light truck means a non-passenger automobile meeting the criteria 
in Sec.  523.5.
    Manufacturer has the meaning given in 49 U.S.C. 32901(a)(14).
    Medium duty passenger vehicle means a vehicle which would satisfy 
the criteria in Sec.  523.5 (relating to light trucks) but for its 
gross vehicle weight rating or its curb weight, which is rated at more 
than 8,500 lbs GVWR or has a vehicle curb weight of more than 6,000 
pounds or has a basic vehicle frontal area in excess of 45 square feet, 
and which is designed primarily to transport passengers, but does not 
include a vehicle that--
    (1) Is an ``incomplete vehicle'' ' as defined in this subpart; or
    (2) Has a seating capacity of more than 12 persons; or
    (3) Is designed for more than 9 persons in seating rearward of the 
driver's seat; or
    (4) Is equipped with an open cargo area (for example, a pick-up 
truck box or bed) of 72.0 inches in interior length or more. A covered 
box not readily accessible from the passenger compartment will be 
considered an open cargo area for purposes of this definition.
    Mild hybrid gasoline-electric vehicle means a vehicle as defined by 
EPA in 40 CFR 86.1866-12(e).
    Motor home has the meaning given in 49 CFR 571.3.
    Motor vehicle has the meaning given in 49 U.S.C. 30102.
    Passenger-carrying volume means the sum of the front seat volume 
and, if any, rear seat volume, as defined in 40 CFR 600.315-08, in the 
case of automobiles to which that term applies. With respect to 
automobiles to which that term does not apply, ``passenger-carrying 
volume'' means the sum in cubic feet, rounded to the nearest 0.1 cubic 
feet, of the volume of a vehicle's front seat and seats to the rear of 
the front seat, as applicable, calculated as follows with the head 
room, shoulder room, and leg room dimensions determined in accordance 
with the procedures outlined in Society of Automotive Engineers 
Recommended Practice J1100, Motor Vehicle Dimensions (Report of Human 
Factors Engineering Committee, Society of Automotive Engineers, 
approved November 2009).
    (1) For front seat volume, divide 1,728 into the product of the 
following SAE dimensions, measured in inches to the nearest 0.1 inches, 
and round the quotient to the nearest 0.001 cubic feet.
    (i) H61-Effective head room--front.
    (ii) W3-Shoulder room--front.
    (iii) L34-Maximum effective leg room-accelerator.
    (2) For the volume of seats to the rear of the front seat, divide 
1,728 into the product of the following SAE dimensions, measured in 
inches to the nearest 0.1 inches, and rounded the quotient to the 
nearest 0.001 cubic feet.
    (i) H63-Effective head room--second.
    (ii) W4-Shoulder room--second.
    (iii) L51-Minimum effective leg room--second.
    Pickup truck means a non-passenger automobile which has a passenger 
compartment and an open cargo area (bed).
    Pintle hooks means a type of towing hitch that uses a tow ring 
configuration to secure to a hook or a ball combination for the purpose 
of towing.
    Recreational vehicle or RV means a motor vehicle equipped with 
living space and amenities found in a motor home.
    Refuse hauler has the meaning given in 40 CFR 1037.801.
    Running clearance means the distance from the surface on which an 
automobile is standing to the lowest point on the automobile, excluding 
unsprung weight.
    School bus has the meaning given in 49 CFR 571.3.
    Static loaded radius arc means a portion of a circle whose center 
is the center of a standard tire-rim combination of an automobile and 
whose radius is the distance from that center to the level surface on 
which the automobile is standing, measured with the automobile at curb 
weight, the wheel parallel to the vehicle's longitudinal centerline, 
and the tire inflated to the manufacturer's recommended pressure.

[[Page 74237]]

    Strong hybrid gasoline-electric vehicle means a vehicle as defined 
by EPA in 40 CFR 86.1866-12(e).
    Temporary living quarters means a space in the interior of an 
automobile in which people may temporarily live and which includes 
sleeping surfaces, such as beds, and household conveniences, such as a 
sink, stove, refrigerator, or toilet.
    Transmission class has the meaning given in 40 CFR 600.002.
    Tranmission configuration has the meaning given in 40 CFR 600.002.
    Transmission type has the meaning given in 40 CFR 86.1803.
    Truck tractor has the meaning given in 49 CFR 571.3 and 49 CFR 
535.5(c). This includes most heavy-duty vehicles specifically designed 
for the primary purpose of pulling trailers, but does not include 
vehicles designed to carry other loads. For purposes of this definition 
``other loads'' would not include loads carried in the cab, sleeper 
compartment, or toolboxes. Examples of vehicles that are similar to 
tractors but that are not tractors under this part include dromedary 
tractors, automobile haulers, straight trucks with trailers hitches, 
and tow trucks.
    Van means a vehicle with a body that fully encloses the driver and 
a cargo carrying or work performing compartment. The distance from the 
leading edge of the windshield to the foremost body section of vans is 
typically shorter than that of pickup trucks and sport utility 
vehicles.
    Vocational tractor means a tractor that is classified as a 
vocational vehicle according to 40 CFR 1037.630
    Vocational vehicle (or heavy-duty vocational vehicle) has the 
meaning given in Sec.  523.8 and 49 CFR 535.5(b). This includes any 
vehicle that is equipped for a particular industry, trade or occupation 
such as construction, heavy hauling, mining, logging, oil fields, 
refuse and includes vehicles such as school buses, motorcoaches and 
RVs.
    Work truck means a vehicle that is rated at more than 8,500 pounds 
and less than or equal to 10,000 pounds gross vehicle weight, and is 
not a medium-duty passenger vehicle as defined in 49 U.S.C. 
32901(a)(19).

0
376. Revise Sec.  523.6 to read as follows:


Sec.  523.6   Heavy-duty vehicle.

    (a) A heavy-duty vehicle is any commercial medium or heavy-duty on-
highway vehicle or a work truck, as defined in 49 U.S.C. 32901(a)(7) 
and (19). For the purpose of this section, heavy-duty vehicles are 
divided into four regulatory categories as follows:
    (1) Heavy-duty pickup trucks and vans;
    (2) Heavy-duty vocational vehicles;
    (3) Truck tractors with a GVWR above 26,000 pounds; and
    (4) Heavy-duty trailers.
    (b) The heavy-duty vehicle classification does not include vehicles 
excluded as specified in 49 CFR 535.3.

0
377. Revise Sec.  523.7 to read as follows:


Sec.  523.7   Heavy-duty pickup trucks and vans.

    (a) Heavy-duty pickup trucks and vans are pickup trucks and vans 
with a gross vehicle weight rating between 8,501 pounds and 14,000 
pounds (Class 2b through 3 vehicles) manufactured as complete vehicles 
by a single or final stage manufacturer or manufactured as incomplete 
vehicles as designated by a manufacturer. See references in 40 CFR 
86.1801-12, 40 CFR 86.1819-17, 40 CFR 1037.150, and 49 CFR 535.5(a).
    (b) Heavy duty vehicles above 14,000 pounds GVWR may be optionally 
certified as heavy-duty pickup trucks and vans and comply with fuel 
consumption standards in 49 CFR 535.5(a), if properly included in a 
test group with similar vehicles at or below 14,000 pounds GVWR. Fuel 
consumption standards apply to these vehicles as if they were Class 3 
heavy-duty vehicles. The work factor for these vehicles may not be 
greater than the largest work factor that applies for vehicles in the 
test group that are at or below 14,000 pounds GVWR (see 40 CFR 86.1819-
14).
    (c) Incomplete heavy-duty vehicles at or below 14,000 pounds GVWR 
may be optionally certified as heavy-duty pickup trucks and vans and 
comply with to the fuel consumption standards in 49 CFR 535.5(a).

0
378. Add Sec.  523.10 to read as follows:


Sec.  523.10   Heavy-duty trailers.

    (a) A trailer means a motor vehicle with or without motive power, 
designed for carrying cargo and for being drawn by another motor 
vehicle as defined in 49 CFR 571.3. For the purpose of this part, 
heavy-duty trailers include only those trailers designed to be drawn by 
a truck tractor excluding non-box trailers other than flatbed trailer, 
tanker trailers and container chassis and those that are coupled to 
vehicles exclusively by pintle hooks or hitches instead of a fifth 
wheel. Heavy-duty trailers may be divided into different types and 
categories as follows:
    (1) Box vans are trailers with enclosed cargo space that is 
permanently attached to the chassis, with fixed sides, nose, and roof. 
Tank trailers are not box vans.
    (2) Box van with front-mounted HVAC systems are refrigerated vans. 
Note that this includes systems that provide cooling, heating, or both. 
All other box vans are dry vans.
    (3) Trailers that are not box vans are non-box trailers. Note that 
the standards for non-box trailers in 49 CFR 535.5(e)(2) apply only to 
flatbed trailers, tank trailers, and container chassis.
    (4) Box van with a length greater than 50 feet are long box vans. 
Other box vans are short box vans.
    (5) The following types of equipment are not trailers:
    (i) Containers that are not permanently mounted on chassis.
    (ii) Dollies used to connect tandem trailers.
    (iii) Equipment that serves similar purposes but are not intended 
to be pulled by a tractor.
    (b) Heavy-duty trailers do not include trailers excluded in 49 CFR 
535.3.

PART 534--RIGHTS AND RESPONSIBILITIES OF MANUFACTURERS IN THE 
CONTEXT OF CHANGES IN CORPORATE RELATIONSHIPS

0
379. Revise the authority citation for part 534 to read as follows:

    Authority: 49 U.S.C. 32901; delegation of authority at 49 CFR 
1.95.


0
380. Add Sec.  534.8 to read as follows:


Sec.  534.8  Shared corporate relationships.

    (a) Vehicles and engines built by multiple manufacturers can share 
responsibility for complying with fuel consumption standards in 49 CFR 
part 535, by following the EPA requirements in 40 CFR 1037.620 and by 
sending a joint agreement between the parties to EPA and NHTSA before 
submitting any certificates of conformity for the applicable vehicles 
or engines in accordance with 40 CFR part 1036, subpart C, and 40 CFR 
part 1037, subpart C.
    (1) Each joint agreement must--
    (i) Define how each manufacturer shares responsibility for the 
planned vehicles or engines.
    (ii) Specify which manufacturer(s) will be responsible for the EPA 
certificates of conformity;
    (iii) Describe the planned vehicles and engines in terms of the 
model types, production volumes, and model years (if known);
    (iv) Describe which manufacturer(s) have engineering and design 
control and sale distribution ownership over the vehicles and/or 
engines; and
    (v) Include signatures from all parties involved in the shared 
corporate relationship.
    (2) After defining the shared relationship between the 
manufacturers, any contractual changes must be

[[Page 74238]]

notified to EPA and NHTSA before the next model year's production of 
the applicable vehicles or engines begins.
    (3) Multiple manufacturers must designate the same shared 
responsibility for complying with fuel consumption standards as 
selected for GHG standards unless otherwise allowed by EPA and NHTSA.
    (b) NHTSA and EPA reserve the right to reject the joint agreement.

0
381. Revise part 535 to read as follows:

PART 535 MEDIUM-AND HEAVY-DUTY VEHICLE FUEL EFFICIENCY PROGRAM

Sec.
535.1 Scope.
535.2 Purpose.
535.3 Applicability.
535.4 Definitions.
535.5 Standards.
535.6 Measurement and calculation procedures.
535.7 Averaging, banking, and trading (ABT) credit program.
535.8 Reporting and recordkeeping requirements.
535.9 Enforcement approach.
535.10 How do manufacturers comply with fuel consumption standards?

    Authority:  49 U.S.C. 32902 and 30101; delegation of authority 
at 49 CFR 1.95.


Sec.  535.1  Scope.

    This part establishes fuel consumption standards pursuant to 49 
U.S.C. 32902(k) for work trucks and commercial medium- and heavy-duty 
on-highway vehicles, including trailers (hereafter referenced as heavy-
duty vehicles), and engines manufactured for sale in the United States. 
This part establishes a credit program manufacturers may use to comply 
with standards and requirements for manufacturers to provide reports to 
the National Highway Traffic Safety Administration regarding their 
efforts to reduce the fuel consumption of heavy-duty vehicles and 
engines.


Sec.  535.2  Purpose.

    The purpose of this part is to reduce the fuel consumption of new 
heavy-duty vehicles and engines by establishing maximum levels for fuel 
consumption standards while providing a flexible credit program to 
assist manufacturers in complying with standards.


Sec.  535.3  Applicability.

    (a) This part applies to manufacturers that produce complete and 
incomplete heavy-duty vehicles as defined in 49 CFR part 523, and to 
the manufacturers of all heavy-duty engines manufactured for use in the 
applicable vehicles for each given model year.
    (b) This part also applies to alterers, final stage manufacturers, 
and intermediate manufacturers producing vehicles and engines or 
assembling motor vehicles or motor vehicle equipment under special 
conditions. Manufacturers comply with this part by following the 
special conditions in 40 CFR 1037.620, 1037.621, and 1037.622 in which 
EPA allows manufacturer to:
    (1) Share responsibility for the vehicles they produce. 
Manufacturers sharing responsibility for complying with emissions and 
fuel consumption standards must submit to the agencies a joint 
agreement as specified in 49 CFR 534.8(a);
    (2) Have certificate holders sell or ship vehicles that are missing 
certain emission-related components to be installed by secondary 
vehicle manufacturers;
    (3) Ship partially complete vehicles to secondary manufacturers;
    (4) Build electric vehicles; and
    (5) Build alternative fueled vehicles from all types of heavy duty 
engine conversions. The conversion manufacturer must:
    (i) Install alternative fuel conversion systems into vehicles 
acquired from vehicle manufacturers prior to first retail sale or prior 
to the vehicle's introduction into interstate commerce.
    (ii) Be designated by the vehicle manufacturer and EPA to be the 
certificate holder.
    (iii) Omit alternative fueled vehicles from compliance with vehicle 
fuel consumption standards, if--
    (A) Excluded from EPA emissions standards; and
    (B) A reasonable technical basis exist that the modified vehicle 
continues to meet emissions and fuel consumption vehicle standards.
    (c) Vehicle and engine manufacturers that must comply with this 
part include manufacturers required to have approved certificates of 
conformity from EPA as specified in 40 CFR parts 86, 1036, and 1037.
    (d) The following heavy-duty vehicles and engines are excluded from 
the requirements of this part:
    (1) Vehicles and engines manufactured prior to January 1, 2014, 
unless certified early under NHTSA's voluntary provisions in Sec.  
535.5.
    (2) Medium-duty passenger vehicles and other vehicles subject to 
the light-duty corporate average fuel economy standards in 49 CFR parts 
531 and 533.
    (3) Recreational vehicles, including motor homes manufactured 
before January 1, 2021, except those produced by manufacturers 
voluntarily complying with NHTSA's early vocational standards for model 
years 2013 through 2020.
    (4) Aircraft vehicles meeting the definition of ``motor vehicle''. 
For example, this would include certain convertible aircraft that can 
be adjusted to operate on public roads.
    (5) Heavy-duty trailers as defined in 49 CFR 523.10 meeting one or 
more of the following criteria are excluded from trailer standards in 
Sec.  535.5(e):
    (i) Trailers with four or more axles and trailers less than 35 feet 
long with three axles (i.e., trailers intended for hauling very heavy 
loads).
    (ii) Trailers intended for temporary or permanent residence, office 
space, or other work space, such as campers, mobile homes, and carnival 
trailers.
    (iii) Trailers with a gap of at least 120 inches between adjacent 
axle centerlines. In the case of adjustable axle spacing, this refers 
to the closest possible axle positioning.
    (iv) Trailers built before January 1, 2021, except those trailers 
built by manufacturers after January 1, 2018, and voluntarily complying 
with NHTSA's early trailer standards for model years 2018 through 2020.
    (v) Note that the definition of ``heavy-duty trailer'' in 49 CFR 
523.10 excludes equipment that serves similar purposes but are not 
intended to be pulled by a tractor. This exclusion applies to such 
equipment whether or not they are known commercially as trailers. For 
example, any equipment pulled by a heavy-duty vehicle with a pintle 
hook or hitch instead of a fifth wheel does not qualify as a trailer 
under this part.
    (6) Engines installed in heavy-duty vehicles that are not used to 
propel vehicles. Note, this includes engines used to indirectly propel 
vehicles (such as electrical generator engines that power to batteries 
for propulsion).
    (7) The provisions of this part do not apply to engines that are 
not internal combustion engines. For example, the provisions of this 
part do not apply to fuel cells. Note that gas turbine engines are 
internal combustion engines.
    (e) The following heavy-duty vehicles and engines are exempted from 
the requirements of this part:
    (1) Off-road vehicles. Vehicle manufacturers producing vehicles 
intended for off-road may exempt vehicles without requesting approval 
from the agencies subject to the criteria in Sec.  535.5(b)(9)(i) and 
40 CFR 1037.631(a). If unusual circumstances exist and a manufacturer 
is uncertain as to whether its vehicles qualify, the manufacturer 
should ask for a preliminary determination from the agencies before 
submitting its application for certification in

[[Page 74239]]

accordance with 40 CFR 1037.205 for the applicable vehicles. Send the 
request with supporting information to EPA and the agencies will 
coordinate in making a preliminary determination as specified in 40 CFR 
1037.210. These decisions are considered to be preliminary approvals 
and subject to final review and approval.
    (2) Small business manufacturers. (i) For Phase 1, small business 
manufacturers are exempted from the vehicle and engine standards of 
Sec.  535.5, but must comply with the reporting requirements of Sec.  
535.8(g).
    (ii) For Phase 2, fuel consumption standards apply on a delayed 
schedule for manufacturers meeting the small business criteria 
specified in 13 CFR 121.201 and in 40 CFR 86.1819-14(k)(5), 40 CFR 
1036.150, and 40 CFR 1037.150. Qualifying manufacturers of truck 
tractors, vocational vehicles, heavy duty pickups and vans, and engines 
are not subject to the fuel consumption standards for vehicles built 
before January 1, 2022 and engines (such as those engines built by 
small alternative fuel engine converters) with a date of manufacturer 
on or after November 14, 2011 and before January 1, 2022. Qualifying 
manufacturers may choose to voluntarily comply early.
    (iii) Small business manufacturers producing vehicles and engines 
that run on any fuel other than gasoline, E85, or diesel fuel meeting 
the criteria specified in 13 CFR 121.201 and in 40 CFR 86.1819-
14(k)(5), 40 CFR 1036.150, and 40 CFR 1037.150 may delay complying with 
every new mandatory standard under this part by one model year.
    (3) Transitional allowances for trailers. Through model year 2026, 
trailer manufacturers may calculate a number of trailers that are 
exempt from the fuel consumption standards of this part. Calculate the 
number of exempt box vans in a given model year by multiplying the 
manufacturer's total U.S.-directed production volume of certified box 
vans by 0.20 and rounding to the nearest whole number; however, in no 
case may the number of exempted box vans be greater than 350 units in 
any given model year. Repeat this calculation to determine the number 
of non-box trailers, up to 250 annual units, that are exempt from 
standards and certification requirements. Manufacturers perform the 
calculation based on their projected production volumes in the first 
year that standards apply; in later years, use actual production 
volumes from the preceding model year. Manufacturers must include these 
calculated values and the production volumes of exempt trailers in 
their annual production reports required under Sec.  535.8(g)(12).
    (4) Engines for specialty vehicles. Engines certified to the 
alternative standards specified in 40 CFR 86.007-11 and 86.008-10 for 
use in specialty vehicles as described in 40 CFR 1037.605. Compliance 
with the vehicle provisions in 40 CFR 1037.605 satisfies compliance for 
NHTSA under this part.
    (f) For model year 2021 and later, vocational vehicle manufacturers 
building custom chassis vehicles (e.g. emergency vehicles) may be 
exempted from standards in Sec.  535.5(b)(4) and may comply with 
alternative fuel consumption standards as specified in Sec.  
535.5(b)(6). Manufacturers complying with alternative fuel consumption 
standards in Sec.  535.5(b)(6) are restricted in using fuel consumption 
credits as specified in Sec.  535.7(c).
    (g) The fuel consumption standards in some cases apply differently 
for spark-ignition and compression-ignition engines or vehicles as 
specified in 40 CFR parts 1036 and 1037. Engine requirements are 
similarly differentiated by engine type and by primary intended service 
class, as described in 40 CFR 1036.140.
    (h) NHTSA may exclude or exempt vehicles and engines under special 
conditions allowed by EPA in accordance with 40 CFR parts 85, 86, 1036, 
1037, 1039, and 1068. Manufacturers should consult the agencies if 
uncertain how to apply any EPA provision under the NHTSA fuel 
consumption program. It is recommend that manufacturers seek 
clarification before producing a vehicle. Upon notification by EPA of a 
fraudulent use of an exemption, NHTSA reserves that right to suspend or 
revoke any exemption or exclusion.
    (i) In cases where there are differences between the application of 
this part and the corresponding EPA program regarding whether a vehicle 
is regulated or not (such as due to differences in applicability 
resulting from differing agency definitions, etc.), manufacturers 
should contact the agencies to identify these vehicles and assess the 
applicability of the agencies' standards. The agencies will provide 
guidance on how the vehicles can comply. Manufacturers are required to 
identify these vehicles in their final reports submitted in accordance 
with Sec.  535.8.


Sec.  535.4  Definitions.

    The terms manufacture and manufacturer are used as defined in 
section 501 of the Act and the terms commercial medium-duty and heavy-
duty on highway vehicle, fuel and work truck are used as defined in 49 
U.S.C. 32901. See 49 CFR 523.2 for general definitions related to 
NHTSA's fuel efficiency programs.
    Act means the Motor Vehicle Information and Cost Savings Act, as 
amended by Pub. L. 94-163 and 96-425.
    Administrator means the Administrator of the National Highway 
Traffic Safety Administration (NHTSA) or the Administrator's delegate.
    Advanced technology means vehicle technology under this fuel 
consumption program in Sec. Sec.  535.6 and 535.7 and by EPA under 40 
CFR 86.1819-14(d)(7), 1036.615, or 1037.615.
    Alterers means a manufacturer that modifies an altered vehicle as 
defined in 49 CFR 567.3
    Alternative fuel conversion has the meaning given for clean 
alternative fuel conversion in 40 CFR 85.502.
    A to B testing has the meaning given in 40 CFR 1037.801.
    Automated manual transmission has the meaning given in 40 CFR 
1037.801.
    Automatic tire inflation system has the meaning given in 40 CFR 
1037.801.
    Automatic transmission (AT) has the meaning given in 40 CFR 
1037.801.
    Auxiliary power unit has the meaning given in 40 CFR 1037.801.
    Averaging set means, a set of engines or vehicles in which fuel 
consumption credits may be exchanged. Credits generated by one engine 
or vehicle family may only be used by other respective engine or 
vehicle families in the same averaging set as specified in Sec.  535.7 
. Note that an averaging set may comprise more than one regulatory 
subcategory. The averaging sets for this HD program are defined as 
follows:
    (1) Heavy-duty pickup trucks and vans.
    (2) Light heavy-duty (LHD) vehicles.
    (3) Medium heavy-duty (MHD) vehicles.
    (4) Heavy heavy-duty (HHD) vehicles.
    (5) Light heavy-duty engines subject to compression-ignition 
standards.
    (6) Medium heavy-duty engines subject to compression-ignition 
standards.
    (7) Heavy heavy-duty engines subject to compression-ignition 
standards.
    (8) Engines subject to spark-ignition standards.
    (9) Long trailers.
    (10) Short trailers.
    (11) Vehicle types certifying to optional custom chassis standards 
as specified in Sec.  535.5(b)(6) form separate averaging sets for each 
vehicle type as specified in Sec.  535.7(c).
    Axle ratio or Drive axle ratio, ka has the meaning given 
in 40 CFR 1037.801.
    Basic vehicle frontal area has the meaning given in 40 CFR 
1037.801.
    Cab-complete vehicle has the meaning given in 49 CFR 523.2.

[[Page 74240]]

    Carryover has the meaning given in 40 CFR 1037.801.
    Certificate holder means the manufacturer who holds the certificate 
of conformity for the vehicle or engine and that assigns the model year 
based on the date when its manufacturing operations are completed 
relative to its annual model year period.
    Certificate of Conformity means an approval document granted by EPA 
to a manufacturer that submits an application for a vehicle or engine 
emissions family in 40 CFR 1036.205 and 1037.205. A certificate of 
conformity is valid from the indicated effective date until December 31 
of the model year for which it is issued. The certificate must be 
renewed annually for any vehicle a manufacturer continues to produce.
    Certification has the meaning given in 40 CFR 1037.801.
    Certified emission level has the meaning given in 40 CFR 1036.801.
    Chassis-cab means the incomplete part of a vehicle that includes a 
frame, a completed occupant compartment and that requires only the 
addition of cargo-carrying, work-performing, or load-bearing components 
to perform its intended functions.
    Chief Counsel means the NHTSA Chief Counsel, or his or her 
designee.
    Class means relating to GVWR classes for vehicles other than 
trailers, as follows:
    (1) Class 2b vehicles are vehicles with a gross vehicle weight 
rating (GVWR) ranging from 8,501 to 10,000 pounds.
    (2) Class 3 through Class 8 vehicles are vehicles with a gross 
vehicle weight rating (GVWR) of 10,001 pounds or more as defined in 49 
CFR 565.15.
    Complete sister vehicle is a complete vehicle of the same 
configuration as a cab-complete vehicle.
    Complete vehicle has the meaning given in 49 CFR part 523.
    Compression-ignition (CI) means relating to a type of 
reciprocating, internal-combustion engine, such as a diesel engine, 
that is not a spark-ignition engine. Note, in accordance with 40 CFR 
1036.1, gas turbine engines and other engines not meeting the 
definition of compression-ignition are deemed to be compression-
ignition engines for complying with fuel consumption standards.
    Configuration means a subclassification within a test group for 
passenger cars, light trucks and medium-duty passenger vehicles and 
heavy-duty pickup trucks and vans which is based on basic engine, 
engine code, transmission type and gear ratios, and final drive ratio.
    Container chassis trailer has the same meaning as container chassis 
in 40 CFR 1037.801.
    Curb weight has the meaning given in 40 CFR 86.1803.
    Custom chassis vehicle means a vocational vehicle that is a motor 
home, school bus, refuse hauler, concrete mixer, emergency vehicle, 
mixed-use vehicle or other buses that are not school buses or motor 
coaches. These vehicle types are defined in 49 CFR 523.3. A ``mixed-use 
vehicle'' is one that meets at least one of the criteria specified in 
40 CFR 1037.631(a)(1) or at least one of the criteria in 40 CFR 
1037.631(a)(2), but not both.
    Date of manufacture means the date on which the certifying vehicle 
manufacturer completes its manufacturing operations, except as follows:
    (1) Where the certificate holder is an engine manufacturer that 
does not manufacture the complete or incomplete vehicle, the date of 
manufacture of the vehicle is based on the date assembly of the vehicle 
is completed.
    (2) EPA and NHTSA may approve an alternate date of manufacture 
based on the date on which the certifying (or primary) vehicle 
manufacturer completes assembly at the place of main assembly, 
consistent with the provisions of 40 CFR 1037.601 and 49 CFR 567.4.
    (3) A vehicle manufacturer that completes assembly of a vehicle at 
two or more facilities may ask to use as the month and year of 
manufacture, for that vehicle, the month and year in which 
manufacturing is completed at the place of main assembly, consistent 
with provisions of 49 CFR 567.4, as the model year. Note that such 
staged assembly is subject to the provisions of 40 CFR 1068.260(c). 
NHTSA's allowance of this provision is effective when EPA approves the 
manufacturer's certificates of conformity for these vehicles.
    Day cab has the meaning given in 40 CFR 1037.801.
    Drayage tractor has the meaning given in 40 CFR 1037.801.
    Dual-clutch transmission (DCT) means a transmission has the meaning 
given in 40 CFR 1037.801.
    Dual-fuel has the meaning given in 40 CFR 1037.801.
    Electric vehicle has the meaning given in 40 CFR 1037.801.
    Emergency vehicle means a vehicle that meets one of the criteria in 
40 CFR 1037.801.
    Engine family has the meaning given in 40 CFR 1036.230. 
Manufacturers designate families in accordance with EPA provisions and 
may not choose different families between the NHTSA and EPA programs.
    Excluded means a vehicle or engine manufacturer or component is not 
required to comply with any aspects with the NHTSA fuel consumption 
program.
    Exempted means a vehicle or engine manufacturer or component is not 
required to comply with certain provisions of the NHTSA fuel 
consumption program.
    Family certification level (FCL) has the meaning given in 40 CFR 
1036.801.
    Family emission limit (FEL) has the meaning given in 40 CFR 
1037.801.
    Final drive ratio has the meaning given in 40 CFR 1037.801.
    Final-stage manufacturer has the meaning given in 49 CFR 567.3 and 
includes secondary vehicle manufacturers as defined in 40 CFR 1037.801.
    Flatbed trailer has the meaning given in 40 CFR 1037.801.
    Fleet in this part means all the heavy-duty vehicles or engines 
within each of the regulatory sub-categories that are manufactured by a 
manufacturer in a particular model year and that are subject to fuel 
consumption standards under Sec.  535.5.
    Fleet average fuel consumption is the calculated average fuel 
consumption performance value for a manufacturer's fleet derived from 
the production weighted fuel consumption values of the unique vehicle 
configurations within each vehicle model type that makes up that 
manufacturer's vehicle fleet in a given model year. In this part, the 
fleet average fuel consumption value is determined for each 
manufacturer's fleet of heavy-duty pickup trucks and vans.
    Fleet average fuel consumption standard is the actual average fuel 
consumption standard for a manufacturer's fleet derived from the 
production weighted fuel consumption standards of each unique vehicle 
configuration, based on payload, tow capacity and drive configuration 
(2, 4 or all-wheel drive), of the model types that makes up that 
manufacturer's vehicle fleet in a given model year. In this part, the 
fleet average fuel consumption standard is determined for each 
manufacturer's fleet of heavy-duty pickup trucks and vans.
    Fuel cell means an electrochemical cell that produces electricity 
via the non-combustion reaction of a consumable fuel, typically 
hydrogen.
    Fuel cell electric vehicle means a motor vehicle propelled solely 
by an electric motor where energy for the motor is supplied by a fuel 
cell.

[[Page 74241]]

    Fuel efficiency means the amount of work performed for each gallon 
of fuel consumed.
    Gaseous fuel has the meaning given in 40 CFR 1037.801.
    Greenhouse gas Emissions Model (GEM) has the meaning given in 40 
CFR 1037.801.
    Gross axle weight rating (GAWR) has the meaning given in 49 CFR 
571.3.
    Gross combination weight rating (GCWR) has the meaning given in 49 
CFR 571.3.
    Gross vehicle weight rating (GVWR) has the meaning given in 49 CFR 
571.3.
    Good engineering judgment has the meaning given in 40 CFR 1068.30. 
See 40 CFR 1068.5 for the administrative process used to evaluate good 
engineering judgment.
    Heavy-duty off-road vehicle means a heavy-duty vocational vehicle 
or vocational tractor that is intended for off-road use.
    Heavy-duty vehicle has the meaning given in 49 CFR part 523.
    Heavy-haul tractor has the meaning given in 40 CFR 1037.801.
    Heavy heavy-duty (HHD) vehicle has the meaning given in vehicle 
service class.
    Hybrid engine or hybrid powertrain means an engine or powertrain 
that includes energy storage features other than a conventional battery 
system or conventional flywheel. Supplemental electrical batteries and 
hydraulic accumulators are examples of hybrid energy storage systems. 
Note that certain provisions in this part treat hybrid engines and 
powertrains intended for vehicles that include regenerative braking 
different than those intended for vehicles that do not include 
regenerative braking.
    Hybrid vehicle means a vehicle that includes energy storage 
features (other than a conventional battery system or conventional 
flywheel) in addition to an internal combustion engine or other engine 
using consumable chemical fuel. Supplemental electrical batteries and 
hydraulic accumulators are examples of hybrid energy storage systems 
Note that certain provisions in this part treat hybrid vehicles that 
include regenerative braking different than those that do not include 
regenerative braking.
    Idle operation has the meaning given in 40 CFR 1037.801.
    Incomplete vehicle has the meaning given in 49 CFR part 523. For 
the purpose of this regulation, a manufacturer may request EPA and 
NHTSA to allow the certification of a vehicle as an incomplete vehicle 
if it manufactures the engine and sells the unassembled chassis 
components, provided it does not produce and sell the body components 
necessary to complete the vehicle.
    Innovative technology means technology certified under Sec.  535.7 
and by EPA under 40 CFR 86.1819-14(d)(13), 1036.610, and 1037.610 in 
the Phase 1 program.
    Intermediate manufacturer has the meaning given in 49 CFR 567.3.
    Light heavy-duty (LHD) vehicle has the meaning given in vehicle 
service class.
    Liquefied petroleum gas (LPG) has the meaning given in 40 CFR 
1036.801.
    Low rolling resistance tire means a tire on a vocational vehicle 
with a tire rolling resistance level (TRRL) of 7.7 kg/metric ton or 
lower, a steer tire on a tractor with a TRRL of 7.7 kg/metric ton or 
lower, or a drive tire on a tractor with a TRRL of 8.1 kg/metric ton or 
lower.
    Manual transmission (MT) has the meaning given in 40 CFR 1037.801.
    Medium heavy-duty (MHD) vehicle has the meaning given in vehicle 
service class.
    Model type has the meaning given in 40 CFR 600.002.
    Model year as it applies to vehicles means:
    (1) For tractors and vocational vehicles with a date of manufacture 
on or after January 1, 2021, the vehicle's model year is the calendar 
year corresponding to the date of manufacture; however, the vehicle's 
model year may be designated to be the year before the calendar year 
corresponding to the date of manufacture if the engine's model year is 
also from an earlier year. Note that subparagraph (2) of this 
definition limits the extent to which vehicle manufacturers may install 
engines built in earlier calendar years. Note that 40 CFR 
1037.601(a)(2) limits the extent to which vehicle manufacturers may 
install engines built in earlier calendar years.
    (2) For trailers and for Phase 1 tractors and vocational vehicles 
with a date of manufacture before January 1, 2021, model year means the 
manufacturer's annual new model production period, except as restricted 
under this definition. It must include January 1 of the calendar year 
for which the model year is named, may not begin before January 2 of 
the previous calendar year, and it must end by December 31 of the named 
calendar year. The model year may be set to match the calendar year 
corresponding to the date of manufacture.
    (i) The manufacturer who holds the certificate of conformity for 
the vehicle must assign the model year based on the date when its 
manufacturing operations are completed relative to its annual model 
year period. In unusual circumstances where completion of your assembly 
is delayed, we may allow you to assign a model year one year earlier, 
provided it does not affect which regulatory requirements will apply.
    (ii) Unless a vehicle is being shipped to a secondary manufacturer 
that will hold the certificate of conformity, the model year must be 
assigned prior to introduction of the vehicle into U.S. commerce. The 
certifying manufacturer must redesignate the model year if it does not 
complete its manufacturing operations within the originally identified 
model year. A vehicle introduced into U.S. commerce without a model 
year is deemed to have a model year equal to the calendar year of its 
introduction into U.S. commerce unless the certifying manufacturer 
assigns a later date.
    Model year as it applies to engines means the manufacturer's annual 
new model production period, except as restricted under this 
definition. It must include January 1 of the calendar year for which 
the model year is named, may not begin before January 2 of the previous 
calendar year, and it must end by December 31 of the named calendar 
year. Manufacturers may not adjust model years to circumvent or delay 
compliance with emission standards or to avoid the obligation to 
certify annually.
    Natural gas has the meaning given in 40 CFR 1036.801. Vehicles that 
use a pilot-ignited natural gas engine (which uses a small diesel fuel 
ignition system), are still considered natural gas vehicles.
    NHTSA Enforcement means the NHTSA Associate Administrator for 
Enforcement, or his or her designee.
    Neutral coasting has the meaning given in 40 CFR 1037.801.
    Off-cycle technology means technology certified under Sec.  535.7 
and by EPA under 40 CFR 86.1819-14(d)(13), 1036.610, and 1037.610 in 
the Phase 2 program.
    Party means the person alleged to have committed a violation of 
Sec.  535.9, and includes manufacturers of vehicles and manufacturers 
of engines.
    Payload means in this part the resultant of subtracting the curb 
weight from the gross vehicle weight rating.
    Petroleum has the meaning given in 40 CFR 1037.801.
    Phase 1 means the joint NHTSA and EPA program established in 2011 
for fuel efficiency standards and greenhouse gas emissions standards 
regulating medium- and heavy-duty engines and vehicles. See Sec.  535.5 
for the specific model years that standards apply to vehicles and 
engines.

[[Page 74242]]

    Phase 2 means the joint NHTSA and EPA program established in 2016 
for fuel efficiency standards and greenhouse gas emissions standards 
regulating medium- and heavy-duty vehicles including trailers, and 
engines. See Sec.  535.5 for the specific model years that standards 
apply to vehicles and engines.
    Pickup truck has the meaning given in 49 CFR part 523.
    Plug-in hybrid electric vehicle (PHEV) means a hybrid electric 
vehicle that has the capability to charge the battery or batteries used 
for vehicle propulsion from an off-vehicle electric source, such that 
the off-vehicle source cannot be connected to the vehicle while the 
vehicle is in motion.
    Power take-off (PTO) means a secondary engine shaft or other system 
on a vehicle that provides substantial auxiliary power for purposes 
unrelated to vehicle propulsion or normal vehicle accessories such as 
air conditioning, power steering, and basic electrical accessories. A 
typical PTO uses a secondary shaft on the engine to transmit power to a 
hydraulic pump that powers auxiliary equipment such as a boom on a 
bucket truck.
    Powertrain family has the meaning given in 40 CFR 1037.231. 
Manufacturers choosing to perform powertrain testing as specified in 40 
CFR 1037.550, divide product lines into powertrain families that are 
expected to have similar fuel consumptions and CO2 emission 
characteristics throughout the useful life.
    Preliminary approval means approval granted by an authorized EPA 
representative prior to submission of an application for certification, 
consistent with the provisions of 40 CFR 1037.210. For requirements 
involving NHTSA, EPA will ensure decisions are jointly made and will 
convey the decision to the manufacturer.
    Primary intended service class has the same meaning for engines as 
specified in 40 CFR 1036.140. Manufacturers must identify a single 
primary intended service class for each engine family that best 
describes vehicles for which it designs and markets the engine, as 
follows:
    (1) Divide compression-ignition engines into primary intended 
service classes based on the following engine and vehicle 
characteristics:
    (i) Light heavy-duty ``LHD'' engines usually are not designed for 
rebuild and do not have cylinder liners. Vehicle body types in this 
group might include any heavy-duty vehicle built from a light-duty 
truck chassis, van trucks, multi-stop vans, and some straight trucks 
with a single rear axle. Typical applications would include personal 
transportation, light-load commercial delivery, passenger service, 
agriculture, and construction. The GVWR of these vehicles is normally 
below 19,500 pounds.
    (ii) Medium heavy-duty ``MHD'' engines may be designed for rebuild 
and may have cylinder liners. Vehicle body types in this group would 
typically include school buses, straight trucks with single rear axles, 
city tractors, and a variety of special purpose vehicles such as small 
dump trucks, and refuse trucks. Typical applications would include 
commercial short haul and intra-city delivery and pickup. Engines in 
this group are normally used in vehicles whose GVWR ranges from 19,500 
to 33,000 pounds.
    (iii) Heavy heavy-duty ``HHD'' engines are designed for multiple 
rebuilds and have cylinder liners. Vehicles in this group are normally 
tractors, trucks, straight trucks with dual rear axles, and buses used 
in inter-city, long-haul applications. These vehicles normally exceed 
33,000 pounds GVWR.
    (2) Divide spark-ignition engines into primary intended service 
classes as follows:
    (i) Spark-ignition engines that are best characterized by paragraph 
(1)(i) or (ii) of this definition are in a separate ``spark-ignition'' 
primary intended service class.
    (ii) Spark-ignition engines that are best characterized by 
paragraph (1)(iii) of this definition share a primary intended service 
class with compression-ignition heavy heavy-duty engines. Gasoline-
fueled engines are presumed not to be characterized by paragraph 
(1)(iii) of this definition; for example, vehicle manufacturers may 
install some number of gasoline-fueled engines in Class 8 trucks 
without causing the engine manufacturer to consider those to be heavy 
heavy-duty engines.
    (iii) References to ``spark-ignition standards'' in this part 
relate only to the spark-ignition engines identified in paragraph 
(b)(1) of this section. References to ``compression-ignition 
standards'' in this part relate to compression-ignition engines, to 
spark-ignition engines optionally certified to standards that apply to 
compression-ignition engines, and to all engines identified under 
paragraph (b)(2) of this section as heavy heavy-duty engines.
    Rechargeable Energy Storage System (RESS) means the component(s) of 
a hybrid engine or vehicle that store recovered energy for later use, 
such as the battery system in a electric hybrid vehicle.
    Refuse hauler has the meaning given in 40 CFR 1037.801.
    Regional has the meaning relating to the Regional duty cycle as 
specified in 40 CFR 1037.510.
    Regulatory category means each of the four types of heavy-duty 
vehicles defined in 49 CFR 523.6 and the heavy-duty engines used in 
these heavy-duty vehicles.
    Regulatory subcategory means the sub-groups in each regulatory 
category to which mandatory fuel consumption standards and requirements 
apply as specified in 40 CFR 1036.230 and 1037.230 and are defined as 
follows:
    (1) Heavy-duty pick-up trucks and vans.
    (2) Vocational vehicle subcategories have 18 separate vehicle 
service classes as shown in Tables 1 and 2 below and include vocational 
tractors. Table 1 includes vehicles complying with Phase 1 standards. 
Phase 2 vehicles are included in Table 2 which have separate 
subcategories to account for engine characteristics, GVWR, and the 
selection of duty cycle for vocational vehicles as specified in 40 CFR 
1037.510; vehicles may additionally fall into one of the subcategories 
defined by the custom-chassis standards in Sec.  535.5(b)(6) and 40 
1037.105(h). Manufacturers using the alternate standards in Sec.  
535.5(b)(6) and 40 CFR 1037.105(h) should treat each vehicle type as a 
separate vehicle subcategory.

            Table 1--Phase 1 Vocational Vehicle Subcategories
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
Vocational LHD vehicles.
Vocational MHD vehicles.
Vocational HHD vehicles.
------------------------------------------------------------------------


                                Table 2--Phase 2 Vocational Vehicle Subcategories
----------------------------------------------------------------------------------------------------------------
             Engine type               Vocational LHD vehicles  Vocational MHD vehicles  Vocational HHD vehicles
----------------------------------------------------------------------------------------------------------------
CI...................................  Urban..................  Urban..................  Urban.
CI...................................  Multi-Purpose..........  Multi-Purpose..........  Multi-Purpose.
CI...................................  Regional...............  Regional...............  Regional.

[[Page 74243]]

 
SI...................................  Urban..................  Urban..................  NA.
SI...................................  Multi-Purpose..........  Multi-Purpose..........  NA.
SI...................................  Regional...............  Regional...............  NA.
----------------------------------------------------------------------------------------------------------------

    (3) Tractor subcategories are shown in Table 3 below for Phase 1 
and 2. Table 3 includes 10 separate subcategories for tractors 
complying with Phase 1 and 2 standards. The heavy-haul tractor 
subcategory only applies for Phase 2.

           Table 3--Phase 1 and 2 Truck Tractor Subcategories
------------------------------------------------------------------------
                                                        Class 8 sleeper
             Class 7               Class 8 day cabs          cabs
------------------------------------------------------------------------
Low-roof tractors...............  Low-roof day cab    Low-roof sleeper
                                   tractors.           cab tractors.
Mid-roof tractors...............  Mid-roof day cab    Mid-roof sleeper
                                   tractors.           cab tractors.
High-roof tractors..............  High-roof day cab   High-roof sleeper
                                   tractors.           cab tractors.
                                 ---------------------------------------
NA..............................   Heavy-haul tractors (applies only to
                                             Phase 2 program).
------------------------------------------------------------------------

    (4) Trailer subcategories are shown in Table 4 of this section for 
the Phase 2 program. Trailers do not comply under the Phase 1 program. 
Table 4 includes 10 separate subcategories for trailers, which are only 
subject to Phase 2 only standards.

                     Table 4--Trailer Subcategories
------------------------------------------------------------------------
                                     Partial-aero
       Full-aero trailers              trailers         Other trailers
------------------------------------------------------------------------
Long box dry vans...............  Long box dry vans.  Non-aero box vans.
Short box dry vans..............  Short box dry vans  Non-box trailers.
Long box refrigerated vans......  Long box            NA.
                                   refrigerated vans.
Short box refrigerated vans.....  Short box           NA.
                                   refrigerated vans.
------------------------------------------------------------------------

    (5) Engine subcategories are shown for each primary intended 
service class in Table 5 below. Table 5 includes 6 separate 
subcategories for engines which are the same for Phase 1 and 2 
standards.

                      Table 5--Engine Subcategories
------------------------------------------------------------------------
           LHD engines                MHD engines         HHD engines
------------------------------------------------------------------------
CI engines for vocational         CI engines for      CI engines for
 vehicles.                         vocational          vocational
                                   vehicles.           vehicles.
NA..............................  CI engines for      CI engines for
                                   truck tractors.     truck tractors.
All spark-ignition engines......                      NA.
------------------------------------------------------------------------

    Revoke has the same meaning given in 40 CFR 1068.30.
    Roof height means the maximum height of a vehicle (rounded to the 
nearest inch), excluding narrow accessories such as exhaust pipes and 
antennas, but including any wide accessories such as roof fairings. 
Measure roof height of the vehicle configured to have its maximum 
height that will occur during actual use, with properly inflated tires 
and no driver, passengers, or cargo onboard. Determine the base roof 
height on fully inflated tires having a static loaded radius equal to 
the arithmetic mean of the largest and smallest static loaded radius of 
tires a manufacturer offers or a standard tire EPA approves. If a 
vehicle is equipped with an adjustable roof fairing, measure the roof 
height with the fairing in its lowest setting. Once the maximum height 
is determined, roof heights are divided into the following categories:
    (1) Low-roof means a vehicle with a roof height of 120 inches or 
less.
    (2) Mid-roof means a vehicle with a roof height between 121 and 147 
inches.
    (3) High-roof means a vehicle with a roof height of 148 inches or 
more.
    Secondary vehicle manufacturer has the same meaning as final-stage 
manufacturer in 49 CFR part 567.
    Service class group means a group of engine and vehicle averaging 
sets defined as follows:
    (1) Spark-ignition engines, light heavy-duty compression-ignition 
engines, light heavy-duty vocational vehicles and heavy-duty pickup 
trucks and vans.
    (2) Medium heavy-duty compression-ignition engines and medium 
heavy-duty vocational vehicles and tractors.
    (3) Heavy heavy-duty compression-ignition engines and heavy heavy-
duty vocational vehicles and tractors.
    Sleeper cab means a type of truck cab that has a compartment behind 
the driver's seat intended to be used by the driver for sleeping. This 
includes both cabs accessible from the driver's compartment and those 
accessible from outside the vehicle.
    Small business manufacturer means a manufacturer meeting the 
criteria specified in 13 CFR 121.201. For manufacturers owned by a 
parent company, the employee and revenue limits apply to the total 
number employees and total revenue of the parent company and all its 
subsidiaries.

[[Page 74244]]

    Spark-ignition (SI) means relating to a gasoline-fueled engine or 
any other type of engine with a spark plug (or other sparking device) 
and with operating characteristics significantly similar to the 
theoretical Otto combustion cycle. Spark-ignition engines usually use a 
throttle to regulate intake air flow to control power during normal 
operation. Note that some spark-ignition engines are subject to 
requirements that apply for compression-ignition engines as described 
in 40 CFR 1036.140.
    Standard payload means the payload assumed for each vehicle, in 
tons, for modeling and calculating emission credits, as follows:
    (1) For vocational vehicles:
    (i) 2.85 tons for light heavy-duty vehicles.
    (ii) 5.6 tons for medium heavy-duty vehicles.
    (iii) 7.5 tons for heavy heavy-duty vocational vehicles.
    (2) For tractors:
    (i) 12.5 tons for Class 7.
    (ii) 19 tons for Class 8.
    (iii) 43 tons for heavy-haul tractors.
    (3) For trailers:
    (i) 10 tons for short box vans.
    (ii) 19 tons for other trailers.
    Standard tractor has the meaning given in 40 CFR 1037.501.
    Standard trailer has the meaning given in 40 CFR 1037.501.
    Subconfiguration means a unique combination within a vehicle 
configuration of equivalent test weight, road-load horsepower, and any 
other operational characteristics or parameters that EPA determines may 
significantly affect CO2 emissions within a vehicle 
configuration as defined in 40 CFR 600.002.
    Tank trailer has the meaning given in 40 CFR 1037.801.
    Test group means the multiple vehicle lines and model types that 
share critical emissions and fuel consumption related features and that 
are certified as a group by a common certificate of conformity issued 
by EPA and is used collectively with other test groups within an 
averaging set or regulatory subcategory and is used by NHTSA for 
determining the fleet average fuel consumption.
    The agencies means the National Highway Traffic Safety 
Administration (NHTSA) and the Environmental Protection Agency (EPA) in 
this part.
    Tire pressure monitoring system (TPMS) has the meaning given in 
section S3 of 49 CFR 571.138.
    Tire rolling resistance level (TRRL) means a value with units of 
kg/metric ton that represents that rolling resistance of a tire 
configuration. TRRLs are used as inputs to the GEM model under 40 CFR 
1037.520. Note that a manufacturer may assign a value higher than a 
measured rolling resistance of a tire configuration.
    Towing capacity in this part is equal to the resultant of 
subtracting the gross vehicle weight rating from the gross combined 
weight rating.
    Trade means to exchange fuel consumption credits, either as a buyer 
or a seller.
    U.S.-directed production volume means the number of vehicle units, 
subject to the requirements of this part, produced by a manufacturer 
for which the manufacturer has a reasonable assurance that sale was or 
will be made to ultimate purchasers in the United States.
    Useful life has the meaning given in 40 CFR 1036.801 and 1037.801.
    Vehicle configuration means a unique combination of vehicle 
hardware and calibration (related to measured or modeled emissions) 
within a vehicle family as specified in 40 CFR 1037.801. Vehicles with 
hardware or software differences, but that have no hardware or software 
differences related to measured or modeled emissions or fuel 
consumption can be included in the same vehicle configuration. Note 
that vehicles with hardware or software differences related to measured 
or modeled emissions or fuel consumption are considered to be different 
configurations even if they have the same GEM inputs and FEL. Vehicles 
within a vehicle configuration differ only with respect to normal 
production variability or factors unrelated to measured or modeled 
emissions and fuel consumption for EPA and NHTSA.
    Vehicle family has the meaning given in 40 CFR 1037.230. 
Manufacturers designate families in accordance with EPA provisions and 
may not choose different families between the NHTSA and EPA programs. 
If a manufacturer is certifying vehicles within a vehicle family to 
more than one FEL, it must subdivide its greenhouse gas and fuel 
consumption vehicle families into subfamilies that include vehicles 
with identical FELs. Note that a manufacturer may add subfamilies at 
any time during the model year.
    Vehicle service class has the same meaning for vehicles as 
specified in 40 CFR 1037.140. Fuel consumption standards and other 
provisions of this part apply to specific vehicle service classes for 
tractors and vocational vehicles as follows:
    (1) Phase 1 and Phase 2 tractors are divided based on GVWR into 
Class 7 tractors and Class 8 tractors. Where provisions apply to both 
tractors and vocational vehicles, Class 7 tractors are considered 
medium heavy-duty ``MHD'' vehicles and Class 8 tractors are considered 
heavy heavy-duty ``HHD'' vehicles.
    (2) Phase 1 vocational vehicles are divided based on GVWR. Light 
heavy-duty ``LHD'' vehicles includes Class 2b through Class 5 vehicles; 
medium heavy-duty ``MHD'' vehicles includes Class 6 and Class 7 
vehicles; and heavy heavy-duty ``HHD'' vehicles includes Class 8 
vehicles.
    (3) Phase 2 vocational vehicles with spark-ignition engines are 
divided based on GVWR. Light heavy-duty ``LHD'' vehicles includes Class 
2b through Class 5 vehicles, and medium heavy-duty ``MHD'' vehicles 
includes Class 6 through Class 8 vehicles.
    (4) Phase 2 vocational vehicles with compression-ignition engines 
are divided as follows:
    (i) Class 2b through Class 5 vehicles are considered light heavy-
duty ``LHD'' vehicles.
    (ii) Class 6 through 8 vehicles are considered heavy heavy-duty 
``HHD'' vehicles if the installed engine's primary intended service 
class is heavy heavy-duty (see 40 CFR 1036.140). All other Class 6 
through Class 8 vehicles are considered medium heavy-duty ``MHD'' 
vehicles.
    (5) In certain circumstances, manufacturers may certify vehicles to 
standards that apply for a different vehicle service class such as 
allowed in Sec.  535.5(b)(6) and (c)(7). If manufacturers optionally 
certify vehicles to different standards, those vehicles are subject to 
all the regulatory requirements as if the standards were mandatory.
    Vehicle subfamily or subfamily means a subset of a vehicle family 
including vehicles subject to the same FEL(s).
    Vocational tractor has the meaning given in 40 CFR 1037.801.
    Zero emissions vehicle means an electric vehicle or a fuel cell 
vehicle.


Sec.  535.5  Standards.

    (a) Heavy-duty pickup trucks and vans. Each manufacturer's fleet of 
heavy-duty pickup trucks and vans shall comply with the fuel 
consumption standards in this paragraph (a) expressed in gallons per 
100 miles. Each vehicle must be manufactured to comply for its full 
useful life. For the Phase 1 program, if the manufacturer's fleet 
includes conventional vehicles (gasoline, diesel and alternative fueled 
vehicles) and advanced technology vehicles (hybrids with powertrain 
designs that include energy storage systems, vehicles with waste heat 
recovery, electric vehicles and fuel cell vehicles), it may divide its 
fleet into two separate fleets each with its own separate fleet average 
fuel consumption

[[Page 74245]]

standard which the manufacturer must comply with the requirements of 
this paragraph (a). For Phase 2, manufacturers may calculate their 
fleet average fuel consumption standard for a conventional fleet and 
multiple advanced technology vehicle fleets. Advanced technology 
vehicle fleets should be separated into plug-in hybrid electric 
vehicles, electric vehicles and fuel cell vehicles. NHTSA standards 
correspond to the same requirements for EPA as specified in 40 CFR 
86.1819-14.
    (1) Mandatory standards. For model years 2016 and later, each 
manufacturer must comply with the fleet average standard derived from 
the unique subconfiguration target standards (or groups of 
subconfigurations approved by EPA in accordance with 40 CFR 86.1819) of 
the model types that make up the manufacturer's fleet in a given model 
year. Each subconfiguration has a unique attribute-based target 
standard, defined by each group of vehicles having the same payload, 
towing capacity and whether the vehicles are equipped with a 2-wheel or 
4-wheel drive configuration. Phase 1 target standards apply for model 
years 2016 through 2020. Phase 2 target standards apply for model year 
2021 and afterwards.
    (2) Subconfiguration target standards. (i) Two alternatives exist 
for determining the subconfiguration target standards for Phase 1. For 
each alternative, separate standards exist for compression-ignition and 
spark-ignition vehicles:
    (A) The first alternative allows manufacturers to determine a fixed 
fuel consumption standard that is constant over the model years; and
    (B) The second alternative allows manufacturers to determine 
standards that are phased-in gradually each year.
    (ii) Calculate the subconfiguration target standards as specified 
in this paragraph (a)(2)(ii), using the appropriate coefficients from 
Table 6 choosing between the alternatives in paragraph (a)(2)(i) of 
this section. For electric or fuel cell heavy-duty vehicles, use 
compression-ignition vehicle coefficients ``c'' and ``d'' and for 
hybrid (including plug-in hybrid), dedicated and dual-fueled vehicles, 
use coefficients ``c'' and ``d'' appropriate for the engine type used. 
Round each standard to the nearest 0.001 gallons per 100 miles and 
specify all weights in pounds rounded to the nearest pound. Calculate 
the subconfiguration target standards using the following equation:

Subconfiguration Target Standard (gallons per 100 miles) = [c x (WF)] + 
d

Where:

WF = Work Factor = [0.75 x (Payload Capacity + Xwd)] + [0.25 x 
Towing Capacity]
Xwd = 4wd Adjustment = 500 lbs if the vehicle group is equipped with 
4wd and all-wheel drive, otherwise equals 0 lbs for 2wd.
Payload Capacity = GVWR (lbs)--Curb Weight (lbs) (for each vehicle 
group)
Towing Capacity = GCWR (lbs)--GVWR (lbs) (for each vehicle group)


  Table 6--Coefficients for Mandatory Subconfiguration Target Standards
------------------------------------------------------------------------
              Model Year(s)                      c               d
------------------------------------------------------------------------
              Phase 1 Alternative 1--Fixed Target Standards
------------------------------------------------------------------------
                         CI Vehicle Coefficients
------------------------------------------------------------------------
2016 to 2018............................       0.0004322           3.330
2019 to 2020............................       0.0004086           3.143
------------------------------------------------------------------------
                         SI Vehicle Coefficients
------------------------------------------------------------------------
2016 to 2017............................       0.0005131           3.961
2018 to 2020............................       0.0004086           3.143
------------------------------------------------------------------------
            Phase 1 Alternative 2--Phased-in Target Standards
------------------------------------------------------------------------
                         CI Vehicle Coefficients
------------------------------------------------------------------------
2016....................................       0.0004519           3.477
2017....................................       0.0004371           3.369
2018 to 2020............................       0.0004086           3.143
------------------------------------------------------------------------
                         SI Vehicle Coefficients
------------------------------------------------------------------------
2016....................................       0.0005277           4.073
2017....................................       0.0005176           3.983
2018 to 2020............................       0.0004951           3.815
------------------------------------------------------------------------
                     Phase 2--Fixed Target Standards
------------------------------------------------------------------------
                         CI Vehicle Coefficients
------------------------------------------------------------------------
2021....................................       0.0003988           3.065
2022....................................       0.0003880           2.986
2023....................................       0.0003792           2.917
2024....................................       0.0003694           2.839
2025....................................       0.0003605           2.770
2026....................................       0.0003507           2.701
2027 and later..........................       0.0003418           2.633
------------------------------------------------------------------------
                         SI Vehicle Coefficients
------------------------------------------------------------------------
2021....................................       0.0004827           3.725
2022....................................       0.0004703           3.623

[[Page 74246]]

 
2023....................................       0.0004591           3.533
2024....................................       0.0004478           3.443
2025....................................       0.0004366           3.364
2026....................................       0.0004253           3.274
2027 and later..........................       0.0004152           3.196
------------------------------------------------------------------------

    (3) Fleet average fuel consumption standard. (i) For the Phase 1 
program, calculate each manufacturer's fleet average fuel consumption 
standard for a conventional fleet and a combined advanced technology 
fleet separately based on the subconfiguration target standards 
specified in paragraph (a)(2) of this section, weighted to production 
volumes and averaged using the following equation combining all the 
applicable vehicles in a manufacturer's U.S.-directed fleet 
(compression-ignition, spark-ignition and advanced technology vehicles) 
for a given model year, rounded to the nearest 0.001 gallons per 100 
miles:
[GRAPHIC] [TIFF OMITTED] TR25OC16.306

Where:

Subconfiguration Target Standardi = fuel consumption standard for 
each group of vehicles with same payload, towing capacity and drive 
configuration (gallons per 100 miles).
Volumei = production volume of each unique subconfiguration of a 
model type based upon payload, towing capacity and drive 
configuration.

    (A) A manufacturer may group together subconfigurations that have 
the same test weight (ETW), GVWR, and GCWR. Calculate work factor and 
target value assuming a curb weight equal to two times ETW minus GVWR.
    (B) A manufacturer may group together other subconfigurations if it 
uses the lowest target value calculated for any of the 
subconfigurations.
    (ii) For Phase 1, manufacturers must select an alternative for 
subconfiguration target standards at the same time they submit the 
model year 2016 pre-model year Report, specified in Sec.  535.8. Once 
selected, the decision cannot be reversed and the manufacturer must 
continue to comply with the same alternative for subsequent model 
years.
    (4) Voluntary standards. (i) Manufacturers may choose voluntarily 
to comply early with fuel consumption standards for model years 2013 
through 2015, as determined in paragraphs (a)(4)(iii) and (iv) of this 
section, for example, in order to begin accumulating credits through 
over-compliance with the applicable standard. A manufacturer choosing 
early compliance must comply with all the vehicles and engines it 
manufactures in each regulatory category for a given model year.
    (ii) A manufacturer must declare its intent to voluntarily comply 
with fuel consumption standards at the same time it submits a Pre-Model 
Report, prior to the compliance model year beginning as specified in 
Sec.  535.8; and, once selected, the decision cannot be reversed and 
the manufacturer must continue to comply for each subsequent model year 
for all the vehicles and engines it manufactures in each regulatory 
category for a given model year.
    (iii) Calculate separate subconfiguration target standards for 
compression-ignition and spark-ignition vehicles for model years 2013 
through 2015 using the equation in paragraph (a)(2)(ii) of this 
section, substituting the appropriate values for the coefficients in 
the following table as appropriate:

  Table 7--Coefficients for Voluntary Subconfiguration Target Standards
------------------------------------------------------------------------
            Model Year(s)                     c                 d
------------------------------------------------------------------------
                         CI Vehicle Coefficients
------------------------------------------------------------------------
2013 and 14.........................         0.0004695             3.615
2015................................         0.0004656             3.595
------------------------------------------------------------------------
                         SI Vehicle Coefficients
------------------------------------------------------------------------
2013 and 14.........................         0.0005424             4.175
2015................................         0.0005390             4.152
------------------------------------------------------------------------

    (iv) Calculate the fleet average fuel consumption standards for 
model years 2013 through 2015 using the equation in paragraph (a)(3) of 
this section.
    (5) Exclusion of vehicles not certified as complete vehicles. The 
vehicle standards in paragraph (a) of this section do not apply for 
vehicles that are chassis-certified with respect to EPA's criteria 
pollutant test procedure in 40 CFR part 86, subpart S. Any chassis-
certified vehicles must comply with the vehicle standards and 
requirements of paragraph (b) of this section and the engine standards 
of paragraph (d) of this section for engines used in these vehicles. A 
vehicle manufacturer choosing to comply with this paragraph and that is 
not the engine manufacturer is required to notify the engine 
manufacturers that their engines are subject to paragraph (d) of this 
section and that it intends to use their engines in excluded vehicles.
    (6) Optional certification under this section. Manufacturers may 
certify certain complete or cab-complete

[[Page 74247]]

vehicles to the fuel consumption standards of this section. All 
vehicles optionally certified under this paragraph (6) are deemed to be 
subject to the fuel consumption standards of this section given the 
following conditions:
    (i) For fuel consumption compliance, manufacturers may certify any 
complete or cab-complete spark-ignition vehicles above 14,000 pounds 
GVWR and at or below 26,000 pounds GVWR to the fuel consumption 
standards of this section.
    (ii) Manufacturers may apply the provisions of this section to cab-
complete vehicles based on a complete sister vehicle. In unusual 
circumstances, manufacturers may ask the agencies to apply these 
provisions to Class 2b or Class 3 incomplete vehicles that do not meet 
the definition of cab-complete.
    (A) Except as specified in paragraph (a)(6)(iii) of this section, 
for purposes of this section, a complete sister vehicle is a complete 
vehicle of the same vehicle configuration as the cab-complete vehicle. 
A manufacturer may not apply the provisions of this paragraph (6) to 
any vehicle configuration that has a four-wheel rear axle if the 
complete sister vehicle has a two-wheel rear axle.
    (B) Calculate the target value for the fleet-average fuel 
consumption standard under paragraph (a)(3) of this section based on 
the work factor value that applies for the complete sister vehicle.
    (C) Test these cab-complete vehicles using the same equivalent test 
weight and other dynamometer settings that apply for the complete 
vehicle from which you used the work factor value (the complete sister 
vehicle). For fuel consumption certification, manufacturers may submit 
the test data from that complete sister vehicle instead of performing 
the test on the cab-complete vehicle.
    (D) Manufacturers are not required to produce the complete sister 
vehicle for sale to use the provisions of this paragraph (a)(6)(ii). 
This means the complete sister vehicle may be a carryover vehicle from 
a prior model year or a vehicle created solely for the purpose of 
testing.
    (iii) For fuel consumption purposes, if a cab-complete vehicle is 
not of the same vehicle configuration as a complete sister vehicle due 
only to certain factors unrelated to coastdown performance, 
manufacturers may use the road-load coefficients from the complete 
sister vehicle for certification testing of the cab-complete vehicle, 
but it may not use fuel consumption data from the complete sister 
vehicle for certifying the cab-complete vehicle.
    (7) Loose engines. For model year 2023 and earlier spark-ignition 
engines with identical hardware compared with engines used in vehicles 
certified to the standards of this section, where such engines are sold 
as loose engines or as engines installed in incomplete vehicles that 
are not cab-complete vehicles. Manufacturers may certify such engines 
to the standards of this section, subject to the following provisions:
    (i) For 2020 and earlier model years, the maximum allowable U.S.-
directed production volume of engines manufacturers may sell under this 
paragraph (7) in any given model year is ten percent of the total U.S-
directed production volume of engines of that design that the 
manufacturer produces for heavy-duty applications for that model year, 
including engines it produces for complete vehicles, cab-complete 
vehicles, and other incomplete vehicles. The total number of engines a 
manufacturer may certify under this paragraph (7), of all engine 
designs, may not exceed 15,000 in any model year. Engines produced in 
excess of either of these limits are not covered by your certificate. 
For example, a manufacturer produces 80,000 complete model year 2017 
Class 2b pickup trucks with a certain engine and 10,000 incomplete 
model year 2017 Class 3 vehicles with that same engine, and the 
manufacturer did not apply the provisions of this paragraph (a)(7) to 
any other engine designs, it may produce up to 10,000 engines of that 
design for sale as loose engines under this paragraph (a)(7). If a 
manufacturer produced 11,000 engines of that design for sale as loose 
engines, the last 1,000 of them that it produced in that model year 
2017 would be considered uncertified.
    (ii) For model years 2021 through 2023, the U.S.-directed 
production volume of engines manufacturers sell under this paragraph 
(a)(7) in any given model year may not exceed 10,000 units. This 
paragraph (a)(7) does not apply for engines certified to the standards 
of paragraph (d) of this section and 40 CFR 1036.108.
    (iii) Vehicles using engines certified under this paragraph (a)(7) 
are subject to the fuel consumption and emission standards of paragraph 
(b) of this section and 40 CFR 1037.105 and engine standards in 40 CFR 
1036.150(j).
    (iv) For certification purposes, engines are deemed to have a fuel 
consumption target values and test result equal to the fuel consumption 
target value and test result for the complete vehicle in the applicable 
test group with the highest equivalent test weight, except as specified 
in paragraph (a)(7)(iv)(B) of this section. Manufacturers use these 
values to calculate target values and the fleet-average fuel 
consumption rate. Where there are multiple complete vehicles with the 
same highest equivalent test weight, select the fuel consumption target 
value and test result as follows:
    (A) If one or more of the fuel consumption test results exceed the 
applicable target value, use the fuel consumption target value and test 
result of the vehicle that exceeds its target value by the greatest 
amount.
    (B) If none of the fuel consumption test results exceed the 
applicable target value, select the highest target value and set the 
test result equal to it. This means that the manufacturer may not 
generate fuel consumption credits from vehicles certified under this 
paragraph (a)(7).
    (8) Alternative fuel vehicle conversions. Alternative fuel vehicle 
conversions may demonstrate compliance with the standards of this part 
or other alternative compliance approaches allowed by EPA in 40 CFR 
85.525.
    (9) Advanced, innovative and off-cycle technologies. For vehicles 
subject to Phase 1 standards, manufacturers may generate separate 
credit allowances for advanced and innovative technologies as specified 
in Sec.  535.7(f)(1) and (2). For vehicles subject to Phase 2 
standards, manufacturers may generate separate credits allowance for 
off-cycle technologies in accordance with Sec.  535.7(f)(2). Separate 
credit allowances for advanced technology vehicles cannot be generated; 
instead manufacturers may use the credit multipliers specified in Sec.  
535.7(f)(1)(iv) through model year 2026.
    (10) Useful life. The following useful life values apply for the 
standards of this section:
    (i) 120,000 miles or 10 years, whichever comes first, for Class 2b 
through Class 3 heavy-duty pickup trucks and vans certified to Phase 1 
standards.
    (ii) 150,000 miles or 15 years, whichever comes first, for Class 2b 
through Class 3 heavy-duty pickup trucks and vans certified to Phase 2 
standards.
    (iii) For Phase 1 credits that you calculate based on a useful life 
of 120,000 miles, multiply any banked credits that you carry forward 
for use into the Phase 2 program by 1.25. For Phase 1 credit deficits 
that you generate based on a useful life of 120,000 miles multiply the 
credit deficit by 1.25 if offsetting the shortfall with Phase 2 
credits.
    (11) Compliance with standards. A manufacturer complies with the 
standards of this part as described in Sec.  535.10.

[[Page 74248]]

    (b) Heavy-duty vocational vehicles. Each manufacturer building 
complete or incomplete heavy-duty vocational vehicles shall comply with 
the fuel consumption standards in this paragraph (b) expressed in 
gallons per 1000 ton-miles. Engines used in heavy-duty vocational 
vehicles shall comply with the standards in paragraph (d) of this 
section. Each vehicle must be manufactured to comply for its full 
useful life. Standards apply to the vehicle subfamilies based upon the 
vehicle service classes within each of the vocational vehicle 
regulatory subcategories in accordance with Sec.  535.4 and based upon 
the applicable modeling and testing specified in Sec.  535.6. Determine 
the duty cycles that apply to vocational vehicles according to 40 CFR 
1037.140 and 1037.150(z).
    (1) Mandatory standards. Heavy-duty vocational vehicle subfamilies 
produced for Phase 1 must comply with the fuel consumption standards in 
paragraph (b)(3) of this section. For Phase 2, each vehicle 
manufacturer of heavy-duty vocational vehicle subfamilies must comply 
with the fuel consumption standards in paragraph (b)(4) of this 
section.
    (i) For model years 2016 to 2020, the heavy-duty vocational vehicle 
category is subdivided by GVWR into three regulatory subcategories as 
defined in Sec.  535.4, each with its own assigned standard.
    (ii) For model years 2021 and later, the heavy-duty vocational 
vehicle category is subdivided into 15 regulatory subcategories 
depending upon whether vehicles are equipped with a compression or 
spark-ignition engine, as defined in Sec.  535.4. Standards also differ 
based upon vehicle service class and intended vehicle duty cycles. See 
40 CFR 1037.140 and 1037.150(z).
    (iii) For purposes of certifying vehicles to fuel consumption 
standards, manufacturers must divide their product lines in each 
regulatory subcategory into vehicle families that have similar 
emissions and fuel consumption features, as specified by EPA in 40 CFR 
1037.230. These families will be subject to the applicable standards. 
Each vehicle family is limited to a single model year.
    (A) Vocational vehicles including custom chassis vehicles must use 
qualified automatic tire inflation systems or tire pressure monitoring 
systems for wheels on all axles.
    (B) Tire pressure monitoring systems must use low pressure warning 
and malfunction telltales in clear view of the driver as specified in 
S4.3 and S4.4 of 49 CFR 571.138.
    (2) Voluntary compliance. (i) For model years 2013 through 2015, a 
manufacturer may choose voluntarily to comply early with the fuel 
consumption standards provided in paragraph (b)(3) of this section. For 
example, a manufacturer may choose to comply early in order to begin 
accumulating credits through over-compliance with the applicable 
standards. A manufacturer choosing early compliance must comply with 
all the vehicles and engines it manufacturers in each regulatory 
category for a given model year.
    (ii) A manufacturer must declare its intent to voluntarily comply 
with fuel consumption standards and identify its plans to comply before 
it submits its first application for a certificate of conformity for 
the respective model year as specified in Sec.  535.8; and, once 
selected, the decision cannot be reversed and the manufacturer must 
continue to comply for each subsequent model year for all the vehicles 
and engines it manufacturers in each regulatory category for a given 
model year.
    (3) Regulatory subcategory standards for model years 2013 to 2020. 
The mandatory and voluntary fuel consumption standards for heavy-duty 
vocational vehicles are given in the following table:

                         Table 8--Phase 1 Vocational Vehicle Fuel Consumption Standards
                                          [Gallons per 1000 ton-miles]
----------------------------------------------------------------------------------------------------------------
                                                                  Vocational LHD  Vocational MHD  Vocational HHD
                    Regulatory subcategories                         vehicles        vehicles        vehicles
----------------------------------------------------------------------------------------------------------------
                                  Model Years 2013 to 2016 Voluntary Standards
----------------------------------------------------------------------------------------------------------------
Standard........................................................         38.1139         22.9862         22.2004
----------------------------------------------------------------------------------------------------------------
                                  Model Years 2017 to 2020 Mandatory Standards
----------------------------------------------------------------------------------------------------------------
Standard........................................................         36.6405         22.1022         21.8075
----------------------------------------------------------------------------------------------------------------

    (4) Regulatory subcategory standards for model years 2021 and 
later. The mandatory fuel consumption standards for heavy-duty 
vocational vehicles are given in the following table:

                         Table 9--Phase 2 Vocational Vehicle Fuel Consumption Standards
                                          [Gallons per 1,000 ton-miles]
----------------------------------------------------------------------------------------------------------------
                                                                  LHD Vocational  MHD Vocational  Vocational HHD
                           Duty cycle                                vehicles        vehicles        vehicles
----------------------------------------------------------------------------------------------------------------
                               Model Years 2021 to 2023 Standards for CI Vehicles
----------------------------------------------------------------------------------------------------------------
Urban...........................................................         41.6503         29.0766         30.2554
Multi-Purpose...................................................         36.6405         26.0314         25.6385
Regional........................................................         30.5501         22.9862         20.2358
----------------------------------------------------------------------------------------------------------------
                               Model Years 2021 to 2023 Standards for SI Vehicles
----------------------------------------------------------------------------------------------------------------
Urban...........................................................         51.8735         36.9078              NA

[[Page 74249]]

 
Multi-Purpose...................................................         45.7972         32.9695              NA
Regional........................................................         37.6955         29.3687              NA
----------------------------------------------------------------------------------------------------------------
                               Model Years 2024 to 2026 Standards for CI Vehicles
----------------------------------------------------------------------------------------------------------------
Urban...........................................................         37.8193         26.6208         27.7996
Multi-Purpose...................................................         33.7917         24.1650         23.7721
Regional........................................................         29.0766         21.7092         19.0570
----------------------------------------------------------------------------------------------------------------
                               Model Years 2024 to 2026 Standards for SI Vehicles
----------------------------------------------------------------------------------------------------------------
Urban...........................................................         48.6103         34.8824              NA
Multi-Purpose...................................................         43.3217         31.3942              NA
Regional........................................................         36.4577         28.2435              NA
----------------------------------------------------------------------------------------------------------------
                              Model Years 2027 and later Standards for CI Vehicles
----------------------------------------------------------------------------------------------------------------
Urban...........................................................         36.0511         25.3438         26.4244
Multi-Purpose...................................................         32.4165         23.0845         22.5933
Regional........................................................         28.5855         21.4145         18.5658
----------------------------------------------------------------------------------------------------------------
                              Model Years 2027 and later Standards for SI Vehicles
----------------------------------------------------------------------------------------------------------------
Urban...........................................................         46.4724         33.4196              NA
Multi-Purpose...................................................         41.8589         30.1564              NA
Regional........................................................         35.8951         27.7934              NA
----------------------------------------------------------------------------------------------------------------

    (5) Subfamily standards. Manufacturers may specify a family 
emission limit (FEL) in terms of fuel consumption for each vehicle 
subfamily. The FEL may not be less than the result of fuel consumption 
modeling from 40 CFR 1037.520. The FELs is the fuel consumption 
standards for the vehicle subfamily instead of the standards specified 
in paragraph (b)(3) and (4) of this section and can be used for 
calculating fuel consumption credits in accordance with Sec.  535.7.
    (6) Alternate standards for custom chassis vehicles for model years 
2021 and later. Manufacturers may elect to certify certain vocational 
vehicles to the alternate standards for custom chassis vehicles 
specified in this paragraph (b)(6) instead of the standards specified 
in paragraph (b)(4) of this section. Note that, although these 
standards were established for custom chassis vehicles, manufacturers 
may apply these provisions to any qualifying vehicle even though these 
standards were established for custom chassis vehicles. For example, 
large diversified vehicle manufacturers may certify vehicles to the 
refuse hauler standards of this section as long as the manufacturer 
ensures that those vehicles qualify as refuse haulers when placed into 
service. GEM simulates vehicle operation for each type of vehicle based 
on an assigned vehicle service class, independent of the vehicle's 
actual characteristics, as shown in Table 10 of this section; however, 
standards apply for the vehicle's useful life based on its actual 
characteristics as specified in paragraph (b)(10) of this section. 
Vehicles certified to these alternative standards must use engines 
certified to requirements under paragraph (d) of this section and 40 
CFR part 1036 for the appropriate model year, except that motor homes 
and emergency vehicles may use engines certified with the loose-engine 
provisions of paragraph (a)(7) of this section and 40 CFR 1037.150(m). 
This also applies for vehicles meeting standards under paragraphs 
(b)(6)(iv) through (vi) of this section. The fuel consumption standards 
for custom chassis vehicles are given in the following table:

                           Table 10--Phase 2 Custom Chassis Fuel Consumption Standards
                                           [Gallon per 1,000 ton-mile]
----------------------------------------------------------------------------------------------------------------
               Vehicle type \1\                  Assigned vehicle service class       MY 2021         MY 2027
----------------------------------------------------------------------------------------------------------------
Coach Bus.....................................  HHD Vehicle.....................         20.6287         20.1375
Motor Home....................................  MDH Vehicle.....................         22.3969         22.2004
School Bus....................................  MHD Vehicle.....................         28.5855         26.6208
Other bus.....................................  HHD Vehicle.....................         29.4695         28.0943
Refuse hauler.................................  HHD Vehicle.....................         30.7466         29.2731
Concrete mixer................................  HHD Vehicle.....................         31.3360         31.0413
Mixed-use vehicle.............................  HHD Vehicle.....................         31.3360         31.0413
Emergency Vehicle.............................  HHD Vehicle.....................         31.8271         31.3360
----------------------------------------------------------------------------------------------------------------
\1\ Vehicle types are generally defined in Sec.   535.3. ``Other bus'' includes any bus that is not a school bus
  or a coach bus. A ``mixed-use vehicle'' is one that meets at least one of the criteria specified in 40 CFR
  1037.631(a)(1) or at least one of the criteria in 40 CFR 1037.631(a)(2), but not both.


[[Page 74250]]

    (i) Manufacturers may generate or use fuel consumption credits for 
averaging to demonstrate compliance with the alternative standards as 
described in Sec.  535.7(c). This requires that manufacturers specify a 
Family Emission Limit (FEL) for fuel consumption for each vehicle 
subfamily. The FEL may not be less than the result of emission modeling 
as described in this paragraph (b). These FELs serve as the fuel 
consumption standards for the vehicle subfamily instead of the 
standards specified in this paragraph (b)(6). Manufacturers may only 
use fuel consumption credits for vehicles certified to the optional 
standards in this paragraph (b)(6) as specified in Sec.  535.7(c)(6) 
through (8) and you may not bank or trade fuel consumption credits from 
any vehicles certified under this paragraph (b)(6).
    (ii) For purposes of this paragraph (b)(6), each separate vehicle 
type identified in Table 10 of this section is in a separate averaging 
set.
    (iii) For purposes of emission and fuel consumption modeling under 
40 CFR 1037.520, consider motor homes and coach buses to be subject to 
the Regional duty cycle, and consider all other vehicles to be subject 
to the Urban duty cycle.
    (iv) Emergency vehicles are deemed to comply with the standards of 
this paragraph (6) if manufacturers use tires with TRRL at or below 8.4 
kg/ton (8.7 g/ton for model years 2021 through 2026).
    (v) Concrete mixers are deemed to comply with the standards of this 
paragraph (6) if manufacturers use tires with TRRL at or below 7.1 kg/
ton (7.6 g/ton for model years 2021 through 2026).
    (vi) Motor homes are deemed to comply with the standards of this 
paragraph (b)(6) if manufacturers use the following technologies:
    (A) Tires with TRRL at or below 6.0 kg/ton (6.7 g/ton for model 
years 2021 through 2026).
    (B) Automatic tire inflation systems or tire pressure monitoring 
systems with wheels on all axles.
    (C) Tire pressure monitoring systems must use low pressure warning 
and malfunction telltales in clear view of the driver as specified in 
S4.3 and S4.4 of 49 CFR 571.138.
    (vii) Small business manufacturers using the alternative standards 
for custom chassis vehicles under this paragraph (b)(6) may use fuel 
consumption credits subject to the unique provisions in Sec.  
535.7(a)(9).
    (7) Advanced, innovative and off-cycle technologies. For vocational 
vehicles subfamilies subject to Phase 1 standards, manufacturers must 
create separate vehicle subfamilies for vehicles that contain advanced 
or innovative technologies and group those vehicles together in a 
vehicle subfamily if they use the same advanced or innovative 
technologies. Manufacturers may generate separate credit allowances for 
advanced and innovative technologies as specified in Sec.  535.7(f)(1) 
and (2). For vehicles subfamilies subject to Phase 2 standards, 
manufacturers may generate separate credit allowances for off-cycle 
technologies in accordance with Sec.  535.7(f)(2). Separate credit 
allowances for advanced technology vehicles cannot be generated but 
instead manufacturers may use the credit multipliers specified in Sec.  
535.7(f)(1)(iv) through model year 2026.
    (8) Certifying across service classes. A manufacturer may 
optionally certify a vocational vehicle subfamilies to the standards 
and useful life applicable to a heavier vehicle service class (such as 
MHD vocational vehicles instead of LHD vocational vehicles). Provisions 
related to generating fuel consumption credits apply as follows:
    (i) If a manufacturer certifies all its vehicles from a given 
vehicle service class in a given model year to the standards and useful 
life that applies for a heavier vehicle service class, it may generate 
credits as appropriate for the heavier service class.
    (ii) Class 8 hybrid vehicles with light or medium heavy-duty 
engines may be certified to compression-ignition standards for the 
Heavy HDV service class. A manufacturer may generate and use credits as 
allowed for the Heavy HDV service class.
    (iii) Except as specified in paragraphs (b)(8)(i) and (ii) of this 
section, a manufacturer may not generate credits with the vehicle. If 
you include lighter vehicles in a subfamily of heavier vehicles with an 
FEL below the standard, exclude the production volume of lighter 
vehicles from the credit calculation. Conversely, if a manufacturer 
includes lighter vehicles in a subfamily with an FEL above the 
standard, it must include the production volume of lighter vehicles in 
the credit calculation.
    (9) Off-road exemptions. This section provides an exemption for 
heavy-duty vocational vehicle subfamilies, including vocational 
tractors that are intended to be used extensively in off-road 
environments such as forests, oil fields, and construction sites from 
the fuel consumption standards in this paragraph (b). Vehicle exempted 
by this part do not comply with vehicle standards in this paragraph 
(b), but the engines in these vehicles must meet the engine 
requirements of paragraph (d) of this section. Note that manufacturers 
may not include these exempted vehicles in any credit calculations 
under this part.
    (i) Qualifying criteria. Vocational vehicles intended for off-road 
use are exempt without request, subject to the provisions of this 
section, if they are primarily designed to perform work off-road (such 
as in oil fields, mining, forests, or construction sites), and they 
meet at least one of the criteria of paragraph (b)(9)(i)(A) of this 
section and at least one of the criteria of paragraph (b)(9)(i)(B) of 
this section. See paragraph (b)(6) of this section for alternate 
standards that apply for vehicles meeting only one of these sets of 
criteria.
    (A) The vehicle must have affixed components designed to work 
inherently in an off-road environment (such as hazardous material 
equipment or off-road drill equipment) or be designed to operate at low 
speeds such that it is unsuitable for normal highway operation.
    (B) The vehicle must meet one of the following criteria:
    (1) Have an axle that has a gross axle weight rating (GAWR) at or 
above 29,000 pounds.
    (2) Have a speed attainable in 2.0 miles of not more than 33 mi/hr.
    (3) Have a speed attainable in 2.0 miles of not more than 45 mi/hr, 
an unloaded vehicle weight that is not less than 95 percent of its 
gross vehicle weight rating, and no capacity to carry occupants other 
than the driver and operating crew.
    (4) Have a maximum speed at or below 54 mi/hr. A manufacturer may 
consider the vehicle to be appropriately speed-limited if engine speed 
at 54 mi/hr is at or above 95 percent of the engine's maximum test 
speed in the highest available gear. A manufacturer may alternatively 
limit vehicle speed by programming the engine or vehicle's electronic 
control module in a way that is tamper-resistant.
    (ii) Tractors. The provisions of this section may apply for 
tractors only if each tractor qualifies as a vocational tractor under 
paragraph (c)(9) of this section or is granted approval for the 
exemption as specified in paragraph (b)(9)(iii) of this section.
    (iii) Preliminary approval before certification. If a manufacturers 
has unusual circumstances where it may be questionable whether its 
vehicles qualify for the off-road exemption of this part, the 
manufacturer may send the agencies information before finishing its 
application for certification (see 40 CFR 1037.205) for the applicable 
vehicles

[[Page 74251]]

and ask for a preliminary informal approval. The agencies will review 
the request and make an appropriate determination in accordance with 40 
CFR 1037.210. The agencies will generally not reverse a decision where 
they have given a manufacturer preliminary approval, unless the 
agencies find new information supporting a different decision. However, 
the agencies will normally not grant relief in cases where the vehicle 
manufacturer has credits or can otherwise comply with the applicable 
standards.
    (iv) Recordkeeping and reporting. (A) A manufacturers must keep 
records to document that its exempted vehicle configurations meet all 
applicable requirements of this section. Keep these records for at 
least eight years after you stop producing the exempted vehicle model. 
The agencies may review these records at any time.
    (B) A manufacturers must also keep records of the individual 
exempted vehicles you produce, including the vehicle identification 
number and a description of the vehicle configuration.
    (C) Within 90 days after the end of each model year, manufacturers 
must send to EPA a report as specified in Sec.  535.8(g)(7) and EPA 
will make the report available to NHTSA.
    (v) Compliance. (A) Manufacturers producing vehicles meeting the 
off-road exemption criteria in paragraph (b)(9)(i) of this section or 
that are granted a preliminary approval comply with the standards of 
this part.
    (B) In situations where a manufacturer would normally ask for a 
preliminary approval subject to paragraph (b)(9)(iii) of this section 
but introduces its vehicle into U.S. commerce without seeking approval 
first from the agencies, those vehicles violate compliance with the 
fuel consumption standards of this part and the EPA provisions under 40 
CFR 1068.101(a)(1).
    (C) If at any time, the agencies find new information that 
contradicts a manufacturer's use of the off-road exemption of this 
part, the manufacturers vehicles will be determined to be non-compliant 
with the regulations of this part and the manufacturer may be liable 
for civil penalties.
    (10) Useful life. The following useful life values apply for the 
standards of this section:
    (i) 110,000 miles or 10 years, whichever comes first, for 
vocational LHD vehicles certified to Phase 1 standards.
    (ii) 150,000 miles or 15 years, whichever comes first, for 
vocational LHD vehicles certified to Phase 2 standards.
    (iii) 185,000 miles or 10 years, whichever comes first, for 
vocational MHD vehicles for Phase 1 and 2.
    (iv) 435,000 miles or 10 years, whichever comes first, for 
vocational HHD vehicles for Phase 1 and 2.
    (v) For Phase 1 credits calculated based on a useful life of 
110,000 miles, multiply any banked credits carried forward for use into 
the Phase 2 program by 1.36. For Phase 1 credit deficits generated 
based on a useful life of 110,000 miles multiply the credit deficit by 
1.36, if offsetting the shortfall with Phase 2 credits.
    (11) Recreational vehicles. Recreational vehicles manufactured 
after model year 2020 must comply with the fuel consumption standards 
of this section. Manufacturers producing these vehicles may also 
certify to fuel consumption standards from 2014 through model year 
2020. Manufacturers may earn credits retroactively for early compliance 
with fuel consumption standards. Once selected, a manufacturer cannot 
reverse the decision and the manufacturer must continue to comply for 
each subsequent model year for all the vehicles it manufacturers in 
each regulatory subcategory for a given model year.
    (12) Loose engines. Manufacturers may certify certain spark-
ignition engines along with chassis-certified heavy-duty vehicles where 
there are identical engines used in those vehicles as described in 40 
CFR 86.1819(k)(8) and 40 CFR 1037.150(m). Vehicles in which those 
engines are installed are subject to standards under this part.
    (13) Compliance with Standards. A manufacturer complies with the 
standards of this part as described in Sec.  535.10.
    (c) Truck tractors. Each manufacturer building truck tractors, 
except vocational tractors or vehicle constructed in accordance with 
Sec.  571.7(e), with a GVWR above 26,000 pounds shall comply with the 
fuel consumption standards in this paragraph (c) expressed in gallons 
per 1000 ton-miles. Engines used in heavy-duty truck tractors vehicles 
shall comply with the standards in paragraph (d) of this section. Each 
vehicle must be manufactured to comply for its full useful life. 
Standards apply to the vehicle subfamilies within each of the tractor 
vehicle regulatory subcategories in accordance with Sec.  535.4 and 40 
CFR 1037.230 and based upon the applicable modeling and testing 
specified in Sec.  535.6. Determine the vehicles in each regulatory 
subcategory in accordance with 40 CFR 1037.140.
    (1) Mandatory standards. For model years 2016 and later, each 
manufacturer's truck tractor subfamilies must comply with the fuel 
consumption standards in paragraph (c)(3) of this section.
    (i) Based on the roof height and the design of the cab, the truck 
tractor category is divided into subcategories as described in Sec.  
535.4. The standards that apply to each regulatory subcategory are 
shown in paragraphs (c)(2) and (3) of this section, each with its own 
assigned standard.
    (ii) For purposes of certifying vehicles to fuel consumption 
standards, manufacturers must divide their product lines in each 
regulatory subcategory into vehicles subfamilies that have similar 
emissions and fuel consumption features, as specified by EPA in 40 CFR 
1037.230, and these subfamilies will be subject to the applicable 
standards. Each vehicle subfamily is limited to a single model year.
    (iii) Standards for truck tractor engines are given in paragraph 
(d) of this section.
    (2) Voluntary compliance. (i) For model years 2013 through 2015, a 
manufacturer may choose voluntarily to comply early with the fuel 
consumption standards provided in paragraph (c)(3) of this section. For 
example, a manufacturer may choose to comply early in order to begin 
accumulating credits through over-compliance with the applicable 
standards. A manufacturer choosing early compliance must comply with 
all the vehicles and engines it manufacturers in each regulatory 
category for a given model year.
    (ii) A manufacturer must declare its intent to voluntarily comply 
with fuel consumption standards and identify its plans to comply before 
it submits its first application for a certificate of conformity for 
the respective model year as specified in Sec.  535.8; and, once 
selected, the decision cannot be reversed and the manufacturer must 
continue to comply for each subsequent model year for all the vehicles 
and engines it manufacturers in each regulatory category for a given 
model year.
    (3) Regulatory subcategory standards. The fuel consumption 
standards for truck tractors, except for vocational tractors, are given 
in the following table:

[[Page 74252]]



                               Table 11--Truck Tractor Fuel Consumption Standards
                                          [Gallons per 1,000 ton-miles]
----------------------------------------------------------------------------------------------------------------
                                                              Day cab               Sleeper cab
            Regulatory subcategories             ------------------------------------------------   Heavy-Haul
                                                      Class 7         Class 8         Class 8
----------------------------------------------------------------------------------------------------------------
                              Phase 1--Model Years 2013 to 2015 Voluntary Standards
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         10.5108          7.9568          6.6798
Mid Roof........................................         11.6896          8.6444          7.4656
High Roof.......................................         12.1807          9.0373          7.3674
----------------------------------------------------------------------------------------------------------------
                                   Phase 1--Model Year 2016 Mandatory Standard
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         10.5108          7.9568          6.6798              NA
Mid Roof........................................         11.6896          8.6444          7.4656
High Roof.......................................         12.1807          9.0373          7.3674
----------------------------------------------------------------------------------------------------------------
                              Phase 1--Model Years 2017 to 2020 Mandatory Standards
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         10.2161          7.8585          6.4833              NA
Mid Roof........................................         11.2967          8.4479          7.1709
High Roof.......................................         11.7878          8.7426          7.0727
----------------------------------------------------------------------------------------------------------------
                              Phase 2--Model Years 2021 to 2023 Mandatory Standards
----------------------------------------------------------------------------------------------------------------
Low Roof........................................        10.36346         7.90766         7.10216         5.14735
Mid Roof........................................        11.11984         8.38900         7.66208
High Roof.......................................        11.14931         8.40864         7.43615
----------------------------------------------------------------------------------------------------------------
                              Phase 2--Model Years 2024 to 2026 Mandatory Standards
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         9.80354         7.48527         6.67976         4.93124
Mid Roof........................................        10.52063         7.94695         7.22004
High Roof.......................................        10.47151         7.89784         6.94499
----------------------------------------------------------------------------------------------------------------
                             Phase 2--Model Years 2027 and later Mandatory Standards
----------------------------------------------------------------------------------------------------------------
Low Roof........................................         9.44990         7.21022         6.29666         4.74460
Mid Roof........................................        10.15717         7.66208         6.83694
High Roof.......................................         9.82318         7.43615         6.31631
----------------------------------------------------------------------------------------------------------------

    (4) Subfamily standards. Manufacturers may generate or use fuel 
consumption credits for averaging, banking, and trading as described in 
Sec.  535.7(c). This requires that manufacturers calculate a credit 
quantity if they specify a Family Emission Limit (FEL) that is 
different than the standard specified in this section. The FEL may not 
be less than the result of emission and fuel consumption modeling from 
40 CFR 1037.520. These FELs serve as the emission standards for the 
specific vehicle subfamily instead of the standards specified in 
paragraph (2) of this section.
    (5) Alternate standards for tractors at or above 120,000 pounds 
GCWR. Manufacturers may certify tractors at or above 120,000 pounds 
GCWR to the following fuel consumption standards in the following 
table:

Table 12--Alternate Fuel Consumption Standards for Tractors Above 120,000 Pounds GCWR for 2021 MY and Later Fuel
                                                   Consumption
                                          [Gallons per 1,000 ton-miles]
----------------------------------------------------------------------------------------------------------------
                                                          Low roof sleeper   Mid roof sleeper  High roof sleeper
 Low roof day cab   Mid roof day cab  High roof day cab         cab                cab                cab
----------------------------------------------------------------------------------------------------------------
        3.59528            3.82122            3.84086            3.26130            3.52652            3.43811
----------------------------------------------------------------------------------------------------------------

    (6) Advanced, innovative and off-cycle technologies. For tractors 
subject to Phase 1 standards, manufacturers must create separate 
vehicle subfamilies for vehicles that contain advanced or innovative 
technologies and group those vehicles together in a vehicle subfamilies 
if they use the same advanced or innovative technologies. Manufacturers 
may generate separate credit allowances for advanced and innovative 
technologies as specified in Sec.  535.7(f)(1) and (2). For vehicles 
subject to Phase 2 standards, manufacturers may generate separate 
credits allowance for off-cycle technologies in accordance with Sec.  
535.7(f)(2). Separate credit allowances for advanced technology 
vehicles cannot be generated but instead manufacturers may use the 
credit multipliers specified in Sec.  535.7(f)(1)(iv) through model 
year 2026.
    (7) Certifying across service classes. Manufacturers may certify 
Class 7 tractors to Class 8 tractors standards as follows:

[[Page 74253]]

    (i) A manufacturer may optionally certify 4x2 tractors with heavy 
heavy-duty engines to the standards and useful life for Class 8 
tractors, with no restriction on generating or using fuel consumption 
credits within the Class 8 averaging set.
    (ii) A manufacturer may optionally certify a Class 7 tractor to the 
standards and useful life applicable to Class 8 tractors. Credit 
provisions apply as follows:
    (A) If a manufacturer certifies all of its Class 7 tractors to 
Class 8 standards, it may use these Heavy HDV credits without 
restriction.
    (B) This paragraph (c)(7)(ii)(B) applies if a manufacturer 
certifies some Class 7 tractors to Class 8 standards under this 
paragraph (c)(7)(ii) but not all of them. If a manufacturer includes 
Class 7 tractors in a subfamily of Class 8 tractors with an FEL below 
the standard, exclude the production volume of Class 7 tractors from 
the credit calculation. Conversely, if a manufacturer includes Class 7 
tractors in a subfamily of Class 8 tractors with an FEL above the 
standard, it must include the production volume of Class 7 tractors in 
the credit calculation.
    (8) Expanded families. Manufacturers may combine dissimilar 
vehicles into a single vehicle subfamilies for applying standards and 
for testing in special circumstances as follows:
    (i) For a Phase 1 vehicle model that straddles a roof-height, cab 
type, or GVWR division, manufacturers can include all the vehicles in 
the same vehicle family if it certifies the vehicle family to the more 
stringent standard. For roof height, the manufacturer must certify to 
the taller roof standard. For cab-type and GVWR, the manufacturers must 
certify to the numerically lower standard.
    (ii) For a Phase 2 vehicle model that includes a range of GVWR 
values that straddle weight classes, manufacturers may include all the 
vehicles in the same vehicle family if it certifies the vehicle family 
to the numerically lower fuel consumption standard from the affected 
service classes. Vehicles that are optionally certified to a more 
stringent standard under this paragraph are subject to useful-life and 
all other provisions corresponding to the weight class with the 
numerically lower fuel consumption standard. For a Phase 2 tractor 
model that includes a range of roof heights that straddle 
subcategories, a manufacturer may include all the vehicles in the same 
vehicle family if it certifies the vehicle family to the appropriate 
subcategory as follows:
    (A) A manufacturer may certify mid-roof tractors as high-roof 
tractors, but it may not certify high-roof tractors as mid-roof 
tractors.
    (B) For tractor families straddling the low-roof/mid-roof division, 
a manufacturer may certify the family based on the primary roof-height 
as long as no more than 10 percent of the tractors are certified to the 
otherwise inapplicable subcategory. For example, if 95 percent of the 
tractors in the family are less than 120 inches tall, and the other 5 
percent are 122 inches tall, a manufacturer may certify the tractors as 
a single family in the low-roof subcategory.
    (C) Determine the appropriate aerodynamic bin number based on the 
actual roof height if the CdA value is measured. However, 
use the GEM input for the bin based on the standards to which the 
manufacturer certifies. For example, of a manufacturer certifies as mid 
roof tractors some low-roof tractors with a measured CdA 
value of 4.2 m\2\, it qualifies as Bin IV; and must input into GEM the 
mid-roof Bin IV value of 5.85 m\2\.
    (9) Vocational tractors. Tractors meeting the definition of 
vocational tractors in 49 CFR 523.2 must comply with requirements for 
heavy-duty vocational vehicles specified in paragraphs (b) and (d) of 
this section. For Phase 1, Class 7 and Class 8 tractors certified or 
exempted as vocational tractors are limited in production to no more 
than 21,000 vehicles in any three consecutive model years. If a 
manufacturer is determined as not applying this allowance in good faith 
by EPA in its applications for certification in accordance with 40 CFR 
1037.205 and 1037.610, a manufacturer must comply with the tractor fuel 
consumption standards in paragraph (c)(3) of this section. No 
production limit applies for vocational tractors subject to Phase 2 
standards.
    (10) Small business manufacturers converting to mid roof or high 
roof configurations. Small manufacturers are to allowed convert low and 
mid roof tractors to high roof configurations without recertification, 
provided it is for the purpose of building a custom sleeper tractor or 
conversion to a natural gas tractor as specified in 40 CFR 1037.150(r).
    (11) Useful life. The following useful life values apply for the 
standards of this section:
    (i) 185,000 miles or 10 years, whichever comes first, for vehicles 
at or below 33,000 pounds GVWR.
    (ii) 435,000 miles or 10 years, whichever comes first, for vehicles 
above 33,000 pounds GVWR.
    (12) Conversion to high-roof configurations. Secondary vehicle 
manufacturers that qualify as small manufacturers may convert low- and 
mid-roof tractors to high-roof configurations without recertification 
for the purpose of building a custom sleeper tractor or converting it 
to run on natural gas, as follows:
    (i) The original low- or mid-roof tractor must be covered by a 
valid certificate of conformity by EPA.
    (ii) The modifications may not increase the frontal area of the 
tractor beyond the frontal area of the equivalent high-roof tractor 
with the corresponding standard trailer. If a manufacturer cannot use 
the original manufacturer's roof fairing for the high-roof tractor, use 
good engineering judgment to achieve similar or better aerodynamic 
performance.
    (iii) The agencies may require that these manufacturers submit 
annual production reports as described in Sec.  535.8 and 40 CFR 
1037.250 indicating the original roof height for requalified vehicles.
    (13) Compliance with standards. A manufacturer complies with the 
standards of this part as described in Sec.  535.10.
    (d) Heavy-duty engines. Each manufacturer of heavy-duty engines 
shall comply with the fuel consumption standards in this paragraph (d) 
of this section expressed in gallons per 100 horsepower-hour. Each 
engine must be manufactured to comply for its full useful life, 
expressed in service miles, operating hours, or calendar years, 
whatever comes first. The provisions of this part apply to all new 2014 
model year and later heavy-duty engines fueled by conventional and 
alternative fuels and manufactured for use in heavy-duty tractors or 
vocational vehicles. Standards apply to the engine families based upon 
the primary intended service classes within each of the engine 
regulatory subcategories as described in Sec.  535.4 and based upon the 
applicable modeling and testing specified in Sec.  535.6.
    (1) Mandatory standards. Manufacturers of heavy-duty engine 
families shall comply with the mandatory fuel consumption standards in 
paragraphs (d)(3) through (6) of this section for model years 2017 and 
later for compression-ignition engines and for model years 2016 and 
later for spark-ignition engines.
    (i) The heavy-duty engine regulatory category is divided into six 
regulatory subcategories, five compression-ignition subcategories and 
one spark-ignition subcategory, as shown in Table 14 of this section.
    (ii) Separate standards exist for engine families manufactured for 
use in heavy-

[[Page 74254]]

duty vocational vehicles and in truck tractors.
    (iii) For purposes of certifying engines to fuel consumption 
standards, manufacturers must divide their product lines in each 
regulatory subcategory into engine families. Fuel consumption standards 
apply each model year to the same engine families used to comply with 
EPA standards in 40 CFR 1036.108 and 40 CFR 1037.230. An engine family 
is designated under the EPA program based upon testing specified in 40 
CFR part 1036, subpart F, and the engine family's primary intended 
service class. Each engine family manufactured for use in a heavy-duty 
tractor or vocational vehicle must be certified to the primary intended 
service class that it is designed for in accordance with 40 CFR 
1036.108 and 1036.140.
    (2) Voluntary compliance. (i) For model years 2013 through 2016 for 
compression-ignition engine families, and for model year 2015 for 
spark-ignition engine families, a manufacturer may choose voluntarily 
to comply with the fuel consumption standards provided in paragraphs 
(d)(3) through (5) of this section. For example, a manufacturer may 
choose to comply early in order to begin accumulating credits through 
over-compliance with the applicable standards. A manufacturer choosing 
early compliance must comply with all the vehicles and engines it 
manufacturers in each regulatory category for a given model year except 
in model year 2013 the manufacturer may comply with individual engine 
families as specified in 40 CFR 1036.150(a)(2).
    (ii) A manufacturer must declare its intent to voluntarily comply 
with fuel consumption standards and identify its plans to comply before 
it submits its first application for a certificate of conformity for 
the respective model year as specified in Sec.  535.8; and, once 
selected, the decision cannot be reversed and the manufacturer must 
continue to comply for each subsequent model year for all the vehicles 
and engines it manufacturers in each regulatory category for a given 
model year.
    (3) Regulatory subcategory standards. The primary fuel consumption 
standards for heavy-duty engine families are given in the following 
table:

                                             Table 13--Primary Heavy-Duty Engine Fuel Consumption Standards
                                                                 [Gallons per 100 hp-hr]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                Regulatory subcategory                   CI LHD engines    CI MHD engines  and all other   HHD CI engines  and all other    SI engines
-------------------------------------------------------   and all other               engines                         engines            ---------------
                                                             engines     ----------------------------------------------------------------
                      Application                      ------------------                                                                       All
                                                           Vocational       Vocational        Tractor       Vocational        Tractor
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Phase 1--Voluntary Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
2015..................................................  ................  ..............  ..............  ..............  ..............          7.0552
2013 to 2016..........................................            5.8939          5.8939          4.9312          5.5697           4.666  ..............
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Phase 1--Mandatory Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
2016..................................................  ................  ..............  ..............  ..............  ..............          7.0552
2017 to 2020..........................................            5.6582          5.6582          4.6660          5.4519          4.4401          7.0552
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Phase 2--Mandatory Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
2021 to 2023..........................................            5.5305          5.3536          4.6464          5.0393          4.3910          7.0552
2024 to 2026..........................................            5.4519          5.2849          4.5285          4.9705          4.2829          7.0552
2027 and later........................................            5.4224          5.2554          4.4892          4.9411          4.2436          7.0552
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (4) Alternate subcategory standards. The alternative fuel 
consumption standards for heavy-duty compression-ignition engine 
families are as follows:
    (i) Manufacturers entering the voluntary program in model years 
2014 through 2016, may choose to certify compression-ignition engine 
families unable to meet standards provided in paragraph (d)(3) of this 
section to the alternative fuel consumption standards of this paragraph 
(d)(4).
    (ii) Manufacturers may not certify engines to these alternate 
standards if they are part of an averaging set in which they carry a 
balance of banked credits. For purposes of this section, manufacturers 
are deemed to carry credits in an averaging set if they carry credits 
from advance technology that are allowed to be used in that averaging 
set in accordance with Sec.  535.7(d)(12).
    (iii) The emission standards of this section are determined as 
specified by EPA in 40 CFR 1036.620(a) through (c) and should be 
converted to equivalent fuel consumption values.
    (5) Alternate phase-in standards. Manufacturers have the option to 
comply with EPA emissions standards for compression-ignition engine 
families using an alternative phase-in schedule that correlates with 
EPA's OBD standards. If a manufacturer chooses to use the alternative 
phase-in schedule for meeting EPA standards and optionally chooses to 
comply early with the NHTSA fuel consumption program, it must use the 
same phase-in schedule beginning in model year 2013 for fuel 
consumption standards and must remain in the program for each model 
year thereafter until model year 2020. The fuel consumption standard 
for each model year of the alternative phase-in schedule is provided in 
Table 15 of this section. Note that engine families certified to these 
standards are not eligible for early credits under Sec.  535.7.

[[Page 74255]]



                   Table 14--Phase 1 Alternative Phase-In CI Engine Fuel Consumption Standards
                                             [Gallons per 100 hp-hr]
----------------------------------------------------------------------------------------------------------------
                            Tractors                                LHD engines     MHD engines     HHD engines
----------------------------------------------------------------------------------------------------------------
Model Years 2013 to 2015........................................              NA          5.0295          4.7642
Model Years 2016 to 2020 [dagger]...............................              NA          4.7839          4.5187
----------------------------------------------------------------------------------------------------------------
Vocational                                                           LHD engines     MHD engines     HHD engines
----------------------------------------------------------------------------------------------------------------
Model Years 2013 to 2015........................................          6.0707          6.0707          5.6680
Model Years 2016 to 2020 [dagger]...............................          5.6582          5.6582          5.4519
----------------------------------------------------------------------------------------------------------------
[dagger] Note: These alternate standards for 2016 and later are the same as the otherwise applicable standards
  for 2017 through 2020.

    (6) Alternative fuel conversions. Engines that have been converted 
to operate on alternative fuels may demonstrate compliance with the 
standards of this part or other alternative compliance approaches 
allowed by EPA in 40 CFR 85.525.
    (7) Optional certification under this section. Manufacturers 
certifying spark-ignition engines to the compression-ignition standards 
for EPA must treat those engines as compression-ignition engines for 
all the provisions of this part.
    (8) Advanced, innovative and off-cycle technologies. For engines 
subject to Phase 1 standards, manufacturers must create separate engine 
families for engines that contain advanced or innovative technologies 
and group those engines together in an engine family if they use the 
same advanced or innovative technologies. Manufacturers may generate 
separate credit allowances for advanced and innovative technologies as 
specified in Sec.  535.7(f)(1) and (2). For engines subject to Phase 2 
standards, manufacturers may generate separate credits allowance for 
off-cycle technologies in accordance with Sec.  535.7(f)(2). Credit 
incentives for advanced technology engines do not apply during the 
Phase 2 period.
    (9) Useful life. The exhaust emission standards of this section 
apply for the full useful life, expressed in service miles, operating 
hours, or calendar years, whichever comes first. The following useful 
life values apply for the standards of this section:
    (i) 120,000 miles or 11 years, whichever comes first, for CI and SI 
LHD engines certified to Phase 1 standards.
    (ii) 150,000 miles or 15 years, whichever comes first, for CI and 
SI LHD and spark-ignition engines certified to Phase 2 standards.
    (iii) 185,000 miles or 10 years, whichever comes first, for CI MHD 
engines certified to Phase 1 and for Phase 2.
    (iv) 435,000 miles or 10 years, whichever comes first, for CI HHD 
engines certified to Phase 1 and for Phase 2.
    (v) For Phase 1 credits that manufacturers calculate based on a 
useful life of 110,000 miles, multiply any banked credits that it 
carries forward for use into the Phase 2 program by 1.36. For Phase 1 
credit deficits that manufacturers generate based on a useful life of 
110,000 miles multiply the credit deficit by 1.36, if offsetting the 
shortfall with Phase 2 credits.
    (10) Loose engines. This paragraph (10) describes alternate 
emission and fuel consumption standards for loose engines certified 
under. The standards of this paragraph (d) and 1036.108 do not apply 
for loose engines certified under paragraph (a) of this section and 40 
CFR 86.1819-14(k)(8). The standards in 40 CFR 1036.150(j) apply for the 
emissions and equivalent fuel consumption measured with the engine 
installed in a complete vehicle consistent with the provisions of 40 
CFR 86.1819-14(k)(8)(vi).
    (11) Alternate transition option for Phase 2 engine standards. (i) 
Manufacturers may optionally elect to comply with the model year 2021 
primary (Phase 2) vocational vehicle and tractor engine standards in 
paragraph (d)(3) of this section beginning in model year 2020 (e.g. 
comply with the more stringent standards one year early). The model 
year 2021 standard would apply to these manufacturers for model years 
2020 through 2023. Manufacturers that voluntarily certify their engines 
to model year 2021 standards early would then be eligible for less 
stringent engine tractor standards in model years 2024 through 2026, as 
follows:
    (A) 5.2849 gallons per 100 hp-hr for MHD vocational vehicle 
engines.
    (B) 4.5874 gallons per 100 hp-hr for MHD tractor engines.
    (C) 4.9705 gallons per 100 hp-hr for HHD vocational vehicle 
engines.
    (D) 4.3418 gallons per 100 hp-hr for HHD tractor engines.
    (ii) The primary standard in paragraph (d)(3) applies for all 
manufacturers in model year 2027 and later years.
    (iii) Manufacturers may apply these provisions separately for 
medium heavy-duty engines and heavy heavy-duty engines. This election 
applies to all engines in each segment. For example, if a manufacturer 
elects this alternate option for its medium heavy-duty engines, all of 
the manufacturer's medium heavy-duty vocational and tractor engines 
must comply. Engine fuel consumption credits generated under Sec.  
535.7(d) for manufacturers complying early with the model year 2021 
standards follow the temporary extended credit life allowance in Sec.  
535.7(d)(9).
    (12) Compliance with Standards. A manufacturer complies with the 
standards of this part as described in Sec.  535.10.
    (e) Heavy-duty Trailers. Each manufacturer of heavy-duty trailers 
as specified in 49 CFR 523.10, except trailers constructed in 
accordance with 49 CFR 571.7(f), shall comply with the fuel consumption 
standards in paragraph (e)(1) of this section expressed in gallons per 
1000 ton-miles. Each vehicle must be manufactured to comply for its 
full useful life. There are no Phase 1 standards for trailers. 
Different levels of stringency apply for box vans depending on features 
that may affect aerodynamic performance. Standards apply to the trailer 
vehicle families within each of the trailer regulatory subcategories in 
accordance with Sec.  535.4 and 40 CFR 1037.230 and based upon the 
applicable modeling and testing specified in Sec.  535.6.
    (1) Fuel consumption standards for Box-Vans. Box van trailer 
families manufactured in model year 2021 and later must comply with the 
fuel consumption standards of this section. For model years 2018 
through 2020, box van trailer manufacturers have the option to 
voluntarily comply with the fuel consumption standards of this section. 
Different levels of stringency

[[Page 74256]]

apply for box vans depending on features that may affect aerodynamic 
performance. A manufacturer may optionally meet less stringent 
standards for different trailer types, which are characterized as 
follows:
    (i) For trailers 35 feet or longer, a manufacturer may designate as 
``non-aero box vans'' those box vans that have a rear lift gate or rear 
hinged ramp, and at least one of the following side features: Side lift 
gate, side-mounted pull-out platform, steps for side-door access, a 
drop-deck design, or belly boxes that occupy at least half the length 
of both sides of the trailer between the centerline of the landing gear 
and the leading edge of the front wheels. For trailers less than 35 
feet long, manufacturers may designate as ``non-aero box vans'' any 
refrigerated box vans with at least one of the side features identified 
for longer trailers.
    (ii) A manufacturer may designate as ``partial-aero box vans'' 
those box vans that have at least one of the side features identified 
in paragraph (a)(1)(i) of this section. Long box vans may also qualify 
as partial-aero box vans if they have a rear lift gate or rear hinged 
ramp. Note that this paragraph (e)(1)(ii) does not apply for box vans 
designated as ``non-aero box vans'' under paragraph (e)(1)(i) of this 
section.
    (iii) ``Full-aero box vans'' are box vans that are not designated 
as non-aero box vans or partial-aero box vans under this paragraph 
(e)(1).
    (iv) Fuel consumption standards apply for full-aero box vans as 
specified in the following table:

                         Table 15--Phase 2 Full Aero Box Van Fuel Consumption Standards
                                          [Gallons per 1,000 ton-miles]
----------------------------------------------------------------------------------------------------------------
                                                              Dry van                    Refrigerated van
                   Model years                   ---------------------------------------------------------------
                                                       Long            Short           Long            Short
----------------------------------------------------------------------------------------------------------------
                                               Voluntary Standards
----------------------------------------------------------------------------------------------------------------
2018 to 2020....................................         7.98625        12.31827         8.15324        12.68173
----------------------------------------------------------------------------------------------------------------
                                               Mandatory Standards
----------------------------------------------------------------------------------------------------------------
2021 to 2023....................................         7.75049        12.15128         7.91749        12.52456
2024 to 2026....................................         7.58350        11.87623         7.75049        12.24951
2027 and later..................................         7.43615        11.72888         7.60314        12.10216
----------------------------------------------------------------------------------------------------------------

    (v) Fuel consumption standards apply for partial-aero box vans as 
specified in the following table:

                     Table 16--Phase 2 Fuel Consumption Standards for Partial-Aero Box Vans
                                          [Gallons per 1,000 ton-mile]
----------------------------------------------------------------------------------------------------------------
                                                              Dry van                    Refrigerated van
                   Model year                    ---------------------------------------------------------------
                                                       Short           Long            Short           Long
----------------------------------------------------------------------------------------------------------------
2018-2020.......................................        12.31827         7.98625        12.68173         8.15324
2021 and later..................................        12.15128         7.91749        12.52456         8.08448
----------------------------------------------------------------------------------------------------------------

    (2) Fuel consumption standards for Non-aero Box Vans and Non-box 
Trailers. (i) Non-aero box van and non-box trailer families 
manufactured in model year 2021 and later must comply with the fuel 
consumption standards of this section. For model years 2018 through 
2020, trailer manufacturers have the option to voluntarily comply with 
the fuel consumption standards of this section.
    (ii) Non-aero box vans and non-box vans must meet the following 
standards:
    (A) Trailers must use automatic tire inflation systems or tire 
pressure monitoring systems with wheels on all axles. Tire pressure 
monitoring systems must use low pressure warning and malfunction 
telltales in clear view of the driver as specified in S4.3 and S4.4 of 
49 CFR 571.138.
    (B) Non-box trailers must use tires with a TRRL at or below 5.1 kg/
tonne. Through model year 2020, non-box trailers may instead use tires 
with a TRRL at or below 6.0 kg/tonne.
    (C) Non-aero box vans must use tires with a TRRL at or below 4.7 
kg/tonne. Through model year 2020, non-aero box vans may instead use 
tires with a TRRL at or below 5.1 kg/tonne.
    (3) Subfamily standards. Starting in model year 2027, manufacturers 
may generate or use fuel consumption credits for averaging to 
demonstrate compliance with the standards specified in paragraph 
(e)(1)(iii) of this section as described in Sec.  535.7(e). This 
requires that manufacturers specify a Family Emission Limit (FEL) for 
fuel consumption for each vehicle subfamily. The FEL may not be less 
than the result of the emission and fuel consumption calculation in 40 
CFR 1037.515. The FEL may not be greater than the appropriate standard 
for model year 2021 trailers. These FELs serve as the fuel consumption 
standards for the specific vehicle subfamily instead of the standards 
specified in paragraph (e)(1) of this section. Manufacturers may not 
use averaging for non-box trailers, partial-aero box vans, or non-aero 
box vans that meet standards under paragraph (e)(1)(i) or (e)(1)(ii) of 
this section, and manufacturers may not use fuel consumption credits 
for banking or trading for any trailers.
    (4) Useful life. The fuel consumption standards of this section 
apply for a useful life equal to 10 years.
    (5) Transitional allowances for trailers. Through model year 2026, 
trailer manufacturers may calculate a number of trailers that are 
exempt from

[[Page 74257]]

the standards and certification requirements of this part. Calculate 
the number of exempt box vans in a given model year by multiplying the 
manufacturer's total U.S.-directed production volume of certified box 
vans by 0.20 and rounding to the nearest whole number; however, in no 
case may the number of exempted box vans be greater than 350 units in 
any given model year. Repeat this calculation to determine the number 
of non-box trailers, up to 250 annual units, that are exempt from 
standards and certification requirements. Perform the calculation based 
on the manufacturer's projected production volumes in the first year 
that standards apply; in later years, use actual production volumes 
from the preceding model year. Manufacturers include these calculated 
values of the production volumes of exempt trailers in their annual 
production report under Sec.  535.8 and 40 CFR 1037.250.
    (6) Roll-up doors for non-aero box vans. Through model year 2023, 
box vans may qualify for non-aero or partial-aero standards under this 
paragraph (e) by treating roll-up rear doors as being equivalent to 
rear lift gates.
    (7) Expanded families. A manufacturer may include refrigerated box 
vans in a vehicle family with dry box vans by treating them all as dry 
box vans for demonstrating compliance with fuel consumption standards. 
A manufacturer may include certain other types of trailers in a vehicle 
family with a different type of trailer, such that the combined set of 
trailers are all subject to the more stringent standards, as follows:
    (i) Standards for long trailers are more stringent than standards 
for short trailers.
    (ii) Standards for long dry box vans are more stringent than 
standards for short refrigerated box vans.
    (iii) Standards for non-aero box vans are more stringent than 
standards for non-box trailers.
    (8) Compliance with standards. A manufacturer complies with the 
standards of this part as described in Sec.  535.10.


Sec.  535.6   Measurement and calculation procedures.

    This part describes the measurement and calculation procedures 
manufacturers use to determine annual fuel consumption performance 
results. Manufacturers use the fuel consumption results determined in 
this part for calculating credit balances specified in Sec.  535.7 and 
then determine whether they comply with standards as specified in Sec.  
535.10. Manufacturers must use EPA emissions test results for deriving 
NHTSA's fuel consumption performance rates. Consequently, manufacturers 
conducting testing for certification or annual demonstration testing 
and providing CO2 emissions data to EPA must also provide 
equivalent fuel consumption results to NHTSA for all values. NHTSA and 
EPA reserve the right to verify separately or in coordination the 
results of any testing and measurement established by manufacturers in 
complying with the provisions of this program and as specified in 40 
CFR 1037.301 and Sec.  535.9. Any carry over data from the Phase 1 
program may be carried into the Phase 2 only with approval from EPA and 
by using good engineering judgment considering differences in testing 
protocols between test procedures.
    (a) Heavy-duty pickup trucks and vans. This section describes the 
method for determining the fuel consumption performance rates for test 
groups and for fleets of complete heavy-duty pickup trucks and vans 
each model year. The NHTSA heavy-duty pickup truck and van fuel 
consumption performance rates correspond to the same requirements for 
EPA as specified in 40 CFR 86.1819-14.
    (1) For the Phase 1 program, if the manufacturer's fleet includes 
conventional vehicles (gasoline, diesel and alternative fueled 
vehicles) and advanced technology vehicles (hybrids with powertrain 
designs that include energy storage systems, vehicles with waste heat 
recovery, electric vehicles and fuel cell vehicles), it may divide its 
fleet into two separate fleets each with its own separate fleet average 
fuel consumption performance rate. For Phase 2, manufacturers may 
calculate their fleet average fuel consumption rates for a conventional 
fleet and separate advanced technology vehicle fleets. Advanced 
technology vehicle fleets should be separated into plug-in hybrid 
electric vehicles, electric vehicles and fuel cell vehicles.
    (2) Vehicles in each fleet should be selected and divided into test 
groups or subconfigurations according to EPA in 40 CFR 86.1819-14(d).
    (3) Use the EPA CO2 emissions test results for each test 
group, in grams per mile, for the selected vehicles.
    (i) Use CO2 emissions test results for vehicles fueled 
by conventional and alternative fuels, including dedicated and dual-
fueled (multi-fuel and flexible-fuel) vehicles using each fuel type as 
specified in 40 CFR 86.1819-14(d)(10).
    (ii) Use CO2 emissions test results for dual-fueled 
vehicles using a weighted average of the manufacturer's emission 
results as specified in 40 CFR 600.510-12(k) for light-duty trucks.
    (iii) All electric vehicles are deemed to have zero emissions of 
CO2, CH4, and N2O. No emission testing 
is required for such electric vehicles. Assign the fuel consumption 
test group result to a value of zero gallons per 100 miles in paragraph 
(a)(4) of this section.
    (iv) Use CO2 emissions test results for cab-complete and 
incomplete vehicles based upon the applicable complete sister vehicles 
as determined in 40 CFR 1819-14(j)(2).
    (v) Use CO2 emissions test results for loose engines 
using applicable complete vehicles as determined in 40 CFR 86.1819-
14(k)(8).
    (vi) Manufacturers can choose to analytically derive CO2 
emission rates (ADCs) for test groups or subconfigurations. Use ADCs 
for test groups or subconfigurations in accordance with 40 CFR 86.1819-
14 (d) and (g).
    (4) Calculate equivalent fuel consumption results for all test 
groups, in gallons per 100 miles, from CO2 emissions test 
group results, in grams per miles, and round to the nearest 0.001 
gallon per 100 miles.
    (i) Calculate the equivalent fuel consumption test group results as 
follows for compression-ignition vehicles and alternative fuel 
compression-ignition vehicles. CO2 emissions test group 
result (grams per mile)/10,180 grams per gallon of diesel fuel) x 
(10\2\) = Fuel consumption test group result (gallons per 100 mile).
    (ii) Calculate the equivalent fuel consumption test group results 
as follows for spark-ignition vehicles and alternative fuel spark-
ignition vehicles. CO2 emissions test group result (grams 
per mile)/8,877 grams per gallon of gasoline fuel) x (10\2\) = Fuel 
consumption test group result (gallons per 100 mile).
    (5) Calculate the fleet average fuel consumption result, in gallons 
per 100 miles, from the equivalent fuel consumption test group results 
and round the fuel consumption result to the nearest 0.001 gallon per 
100 miles. Calculate the fleet average fuel consumption result using 
the following equation.

[[Page 74258]]

[GRAPHIC] [TIFF OMITTED] TR25OC16.307

Where:

Fuel Consumption Test Group Resulti = fuel consumption 
performance for each test group as defined in 49 CFR 523.4.
Volumei = production volume of each test group.

    (6) Compare the fleet average fuel consumption standard to the 
fleet average fuel consumption performance. The fleet average fuel 
consumption performance must be less than or equal to the fleet fuel 
consumption standard to comply with standards in Sec.  535.5(a).
    (b) Heavy-duty vocational vehicles and tractors. This section 
describes the method for determining the fuel consumption performance 
rates for vehicle families of heavy-duty vocational vehicles and 
tractors. The NHTSA heavy-duty vocational vehicle and tractor fuel 
consumption performance rates correspond to the same requirements for 
EPA as specified in 40 CFR 1037, subpart F.
    (1) Select vehicles and vehicle family configurations to test as 
specified in 40 CFR 1037.230 for vehicles that make up each of the 
manufacturer's regulatory subcategories of vocational vehicles and 
tractors. For the Phase 2 program, select powertrain, axle and 
transmission families in accordance with 40 CFR 1037.231 and 1037.232.
    (2) Follow the EPA testing requirements in 40 CFR 1037.230 and 
1037.501 to derive inputs for the Greenhouse gas Emissions Model (GEM).
    (3) Enter inputs into GEM, in accordance with 40 CFR 1037.520, to 
derive the emissions and fuel consumption performance results for all 
vehicles (conventional, alternative fueled and advanced technology 
vehicles).
    (4) For Phase 1 and 2, all of the following GEM inputs apply for 
vocational vehicles and other tractor regulatory subcategories, as 
follows:
    (i) Model year and regulatory subcategory (see Sec.  535.3 and 40 
CFR 1037.230).
    (ii) Coefficient of aerodynamic drag or drag area, as described in 
40 CFR 1037.520(b) (tractors only for Phase 1).
    (iii) Steer and drive tire rolling resistance, as described in 40 
CFR 1037.520(c).
    (iv) Vehicle speed limit, as described in 40 CFR 1037.520(d) 
(tractors only).
    (v) Vehicle weight reduction, as described in 40 CFR 1037.520(e) 
(tractors only for Phase 1).
    (vi) Automatic engine shutdown systems, as described in 40 CFR 
1037.660 (only for Phase 1 Class 8 sleeper cabs). For Phase 1, enter a 
GEM input value of 5.0 g/ton-mile, or an adjusted value as specified in 
40 CFR 1037.660.
    (5) For Phase 2 vehicles, the GEM inputs described in paragraphs 
(b)(4)(i) through (v) of this section continue to apply. Note that the 
provisions related to vehicle speed limiters and automatic engine 
shutdown systems are available for vocational vehicles in Phase 2. The 
additional GEM inputs that apply for vocational vehicles and other 
tractor regulatory subcategories for demonstrating compliance with 
Phase 2 standards are as follows:
    (i) Engine characteristics. Enter information from the engine 
manufacturer to describe the installed engine and its operating 
parameters as described in 40 CFR 1036.510 and 1037.520(f).
    (ii) Vehicle information. Enter information in accordance with 40 
CFR 1037.520(g) for the vehicle and its operating parameters including:
    (A) Transmission make, model and type;
    (B) Drive axle configuration;
    (C) Drive axle ratio, ka;
    (D) GEM inputs associated with powertrain testing include 
powertrain family, transmission calibration identifier, test data from 
40 CFR 1037.550, and the powertrain test configuration (dynamometer 
connected to transmission output or wheel hub).
    (iii) Idle-reduction technologies. Identify whether the 
manufacturer's vehicle has qualifying idle-reduction technologies, 
subject to the qualifying criteria in 40 and 1037.660 and enter values 
for stop start and neutral idle technologies as specified in 40 CFR 
1037.520(h).
    (iv) Axle and transmission efficiency. Manufacturers may use axle 
efficiency maps as described in 40 CFR 1037.560 and transmission 
efficiency maps as described in 40 CFR 1037.565 to replace the default 
values in GEM.
    (v) Additional reduction technologies. Enter input values in GEM as 
follows to characterize the percentage CO2 emission 
reduction corresponding to certain technologies and vehicle 
configurations, or enter 0 as specified in 40 CFR 1037.520(j):
    (A) Intelligent controls
    (B) Accessory load
    (C) Tire-pressure systems
    (D) Extended-idle reduction
    (E) Additional GEM inputs may apply as follows:
    (1) Enter 1.7 and 0.9, respectively, for school buses and coach 
buses that have at least seven available forward gears.
    (2) If the agencies approve an off-cycle technology under Sec.  
535.7(f) and 40 CFR 1037.610 in the form of an improvement factor, 
enter the improvement factor expressed as a percentage reduction in 
CO2 emissions. (Note: In the case of approved off-cycle 
technologies whose benefit is quantified as a g/ton-mile credit, apply 
the credit to the GEM result, not as a GEM input value.)
    (vi) Vehicles with hybrid power take-off (PTO). For vocational 
vehicles, determine the delta PTO emission result of the manufacturer's 
engine and hybrid power take-off system as described in 40 CFR 
1037.540.
    (vii) Aerodynamic improvements for vocational vehicles. For 
vocational vehicles certified using the Regional duty cycle, enter 
[Delta]CdA values to account for using rear fairings and a 
reduced minimum frontal area as specified in 40 CFR 1037.520(m) and 
1037.527.
    (viii) Alternate fuels. For fuels other than those identified in 
GEM, perform the simulation by identifying the vehicle as being diesel-
fueled if the engine is subject to the compression-ignition standard, 
or as being gasoline-fueled if the engine is subject to the spark-
ignition standards. Correct the engine or powertrain fuel map for mass-
specific net energy content as described in 40 CFR 1036.535(b).
    (ix) Custom chassis vehicles. A simplified versions of GEM applies 
for custom chassis vehicle subject Sec.  535.5(b)(6) in accordance with 
40 CFR 1037.520(a)(2)(ii).
    (6) In unusual circumstances, manufacturers may ask EPA to use 
weighted average results of multiple GEM runs to represent special 
technologies for which no single GEM run can accurately reflect.
    (7) From the GEM results, select the CO2 family 
emissions level (FEL) and equivalent fuel consumption values for 
vocational vehicle and tractor families in each regulatory subcategory 
for each model year. Equivalent fuel consumption FELs are derived in 
GEM and expressed to the nearest 0.0001 gallons per 1000 ton-mile. For 
families containing multiple subfamilies, identify the FELs for each 
subfamily.

[[Page 74259]]

    (c) [Reserved]
    (d) Heavy-duty engines. This section describes the method for 
determining equivalent fuel consumption family certification level 
(FCL) values for engine families of heavy-duty truck tractors and 
vocational vehicles. The NHTSA heavy-duty engine fuel consumption FCLs 
are determined from the EPA FCLs tested in accordance with 40 CFR 1036, 
subpart F. Each engine family must use the same primary intended 
service class as designated for EPA in accordance with 40 CFR 1036.140.
    (1) Manufacturers must select emission-data engines representing 
the tested configuration of each engine family specified in 40 CFR part 
86 and 40 CFR 1036.235 for engines in heavy-duty truck tractors and 
vocational vehicles that make up each of the manufacture's regulatory 
subcategories.
    (2) Standards in Sec.  535.5(d) apply to the CO2 
emissions rates for each emissions-data engine in an engine family 
subject to the procedures and equipment specified in 40 CFR part 1036, 
subpart F. Determine equivalent fuel consumptions rates using 
CO2 emissions rates in grams per hp-hr measured to at least 
one more decimal place than that of the applicable EPA standard in 40 
CFR 1036.108.
    (i) Use the CO2 emissions test results for engines 
running on each fuel type for conventional, dedicated, multi-fueled 
(dual-fuel, and flexible-fuel) engines as specified in 40 CFR part 
1036, subpart F.
    (ii) Use the CO2 emissions result for multi-fueled 
engines using the same weighted fuel mixture emission results as 
specified in 40 CFR 1036.235 and 40 CFR part 1036, subpart F.
    (iii) Use the CO2 emissions test results for hybrid 
engines as described in 40 CFR 1036.525.
    (iv) All electric vehicles are deemed to have zero emissions of 
CO2 and zero fuel consumption. No emission or fuel 
consumption testing is required for such electric vehicles.
    (3) Use the CO2 emissions test results for tractor 
engine families in accordance with 40 CFR 1036.501 and for vocational 
vehicle engine families in accordance with 40 CFR part 86, subpart N, 
for each heavy-duty engine regulatory subcategory for each model year.
    (i) If a manufacturer certifies an engine family for use both as a 
vocational engine and as a tractor engine, the manufacturer must split 
the family into two separate subfamilies in accordance with 40 CFR 
1036.230. The manufacturer may assign the numbers and configurations of 
engines within the respective subfamilies at any time prior to the 
submission of the end-of-year report required by 40 CFR 1036.730 and 
Sec.  535.8. The manufacturer must track into which type of vehicle 
each engine is installed, although EPA may allow the manufacturer to 
use statistical methods to determine this for a fraction of its 
engines.
    (ii) The following engines are excluded from the engine families 
used to determine fuel consumption FCL values and the benefit for these 
engines is determined as an advanced technology credit under the ABT 
provisions provided in Sec.  535.7(e); these provisions apply only for 
the Phase 1 program:
    (A) Engines certified as hybrid engines or power packs.
    (B) Engines certified as hybrid engines designed with PTO 
capability and that are sold with the engine coupled to a transmission.
    (C) Engines with Rankine cycle waste heat recovery.
    (4) Manufacturers generating CO2 emissions rates to 
demonstrate compliance to EPA vehicle standards for model years 2021 
and later, using engine fuel maps determined in accordance with 40 CFR 
1036.535 and 1036.540 or engine powertrain results in accordance with 
40 CFR 1036.630 and 40 CFR 1037.550 for each engine configuration, must 
use the same compliance pathway and model years for certifying under 
the NHTSA program. Manufacturers may omit providing equivalent fuel 
consumption FCLs under this section if all of its engines will be 
installed in vehicles that are certified based on powertrain testing as 
described in 40 CFR 1037.550.
    (5) Calculate equivalent fuel consumption values from the emissions 
CO2 FCLs levels for certified engines, in gallons per 100 
hp-hr and round each fuel consumption value to the nearest 0.0001 
gallon per 100 hp-hr.
    (i) Calculate equivalent fuel consumption FCL values for 
compression-ignition engines and alternative fuel compression-ignition 
engines. CO2 FCL value (grams per hp-hr)/10,180 grams per 
gallon of diesel fuel) x (10\2\) = Fuel consumption FCL value (gallons 
per 100 hp-hr).
    (ii) Calculate equivalent fuel consumption FCL values for spark-
ignition engines and alternative fuel spark-ignition engines. 
CO2 FCL value (grams per hp-hr)/8,877 grams per gallon of 
gasoline fuel) x (10\2\) = Fuel consumption FCL value (gallons per 100 
hp-hr).
    (iii) Manufacturers may carryover fuel consumption data from a 
previous model year if allowed to carry over emissions data for EPA in 
accordance with 40 CFR 1036.235.
    (iv) If a manufacturer uses an alternate test procedure under 40 
CFR 1065.10 and subsequently the data is rejected by EPA, NHTSA will 
also reject the data.
    (e) Heavy-duty trailers. This section describes the method for 
determining the fuel consumption performance rates for trailers. The 
NHTSA heavy-duty trailers fuel consumption performance rates correspond 
to the same requirements for EPA as specified in 40 CFR part 1037, 
subpart F.
    (1) Select trailer family configurations that make up each of the 
manufacturer's regulatory subcategories of heavy-duty trailers in 40 
CFR 1037.230 and Sec.  535.4.
    (2) Obtain preliminary approvals for trailer aerodynamic devices 
from EPA in accordance with 40 CFR 1037.150.
    (3) For manufacturers voluntarily complying in model years 2018 
through 2020, and for trailers complying with mandatory standards in 
model years 2021 and later, determine the CO2 emissions and 
fuel consumption results for partial- and full-aero trailers using the 
equations and technologies specified in 40 CFR part 1037, subpart F. 
Use testing to determine input values in accordance with 40 CFR 
1037.515.
    (4) From the equation results, use the CO2 family 
emissions level (FEL) to calculate equivalent fuel consumption FELs are 
expressed to the nearest 0.0001 gallons per 1000 ton-mile.
    (i) For families containing multiple subfamilies, identify the FELs 
for each subfamily.
    (ii) Calculate equivalent fuel consumption FEL values for trailer 
families. CO2 FEL value (grams per 1000 ton-mile)/10,180 
grams per 1000 ton-mile of diesel fuel) x (10\3\) = Fuel consumption 
FEL value. The equivalent fuel consumption FELs are expressed to the 
nearest 0.0001 gallons per 1000 ton-mile.


Sec.  535.7  Averaging, banking, and trading (ABT) credit program.

    (a) General provisions. After the end of each model year, 
manufacturers must comply with the fuel consumption standards in Sec.  
535.5 for averaging, banking and trading credits. Trailer manufacturers 
are excluded from this section except for those producing full-aero box 
trailers, which may comply with special provisions in paragraph (e) of 
this section. Manufacturers comply with standards if the sum of 
averaged, banked and traded credits generate a ``zero'' credit balance 
or a credit surplus within an averaging set of vehicles or engines. 
Manufacturers fail to comply with standards if the sum of the credit 
flexibilities generate a credit deficit (or

[[Page 74260]]

shortfall) in an averaging set. Credit shortfalls must be offset by 
banked or traded credits within three model years after the shortfall 
is incurred. These processes are hereafter referenced as the NHTSA ABT 
credit program. The following provisions apply to all fuel consumption 
credits.
    (1) Credits (or fuel consumption credits (FCCs)). Credits in this 
part mean a calculated weighted value representing the difference 
between the fuel consumption performance and the standard of a vehicle 
or engine family or fleet within a particular averaging set. Positive 
credits represent cases where a vehicle or engine family or fleets 
perform better than the applicable standard (the fuel consumption 
performance is less than the standard) whereas negative credits 
represent underperforming cases. The value of a credit is calculated 
according to paragraphs (b) through (e) of this section. FCCs are only 
considered earned or useable for averaging, banking or trading after 
EPA and NHTSA have verified the information in a manufacturer's final 
reports required in Sec.  535.8. Types of FCCs include the following:
    (i) Conventional credits. Credits generated by vehicle or engine 
families or fleets containing conventional vehicles (i.e., gasoline, 
diesel and alternative fueled vehicles).
    (ii) Early credits. Credits generated by vehicle or engine families 
or fleets produced for model year 2013. Early credits are multiplied by 
an incentive factor of 1.5 times.
    (iii) Advanced technology credits. Credits generated by vehicle or 
engine families or subconfigurations containing vehicles with advanced 
technologies (i.e., hybrids with regenerative braking, vehicles 
equipped with Rankine-cycle engines, electric and fuel cell vehicles) 
and incentivized under this ABT credit program in paragraph (f)(1) of 
this section and by EPA under 40 CFR 86.1819-14(d)(7), 1036.615, and 
1037.615.
    (iv) Innovative and off-cycle technology credits. Credits can be 
generated by vehicle or engine families or subconfigurations having 
fuel consumption reductions resulting from technologies not reflected 
in the GEM simulation tool or in the FTP chassis dynamometer and that 
were not in common use with heavy-duty vehicles or engines before model 
year 2010 that are not reflected in the specified test procedure. 
Manufacturers should prove that these technologies were not in common 
use in heavy-duty vehicles or engines before model year 2010 by 
demonstrating factors such as the penetration rates of the technology 
in the market. NHTSA will not approve any request if it determines that 
these technologies do not qualify. The approach for determining 
innovative and off-cycle technology credits under this fuel consumption 
program is described in paragraph (f)(2) of this section and by EPA 
under 40 CFR 86.1819-14(d)(13), 1036.610, and 1037.610.
    (2) Averaging. Averaging is the summing of a manufacturer's 
positive and negative FCCs for engines or vehicle families or fleets 
within an averaging set. The principle averaging sets are defined in 
Sec.  535.4.
    (i) A credit surplus occurs when the net sum of the manufacturer's 
generated credits for engines or vehicle families or fleets within an 
averaging set is positive (a zero credit balance is when the sum equals 
zero).
    (ii) A credit deficit occurs when the net sum of the manufacturer's 
generated credits for engines or vehicle families or fleets within an 
averaging set is negative.
    (iii) Positive credits, other than advanced technology credits, 
generated and calculated within an averaging set may only be used to 
offset negative credits within the same averaging set.
    (iv) Manufacturers may certify one or more vehicle families (or 
subfamilies) to an FEL above the applicable fuel consumption standard, 
subject to any applicable FEL caps and other provisions allowed by EPA 
in 40 CFR parts 1036 and 1037, if the manufacturer shows in its 
application for certification to EPA that its projected balance of all 
FCC transactions in that model year is greater than or equal to zero or 
that a negative balance is allowed by EPA under 40 CFR 1036.745 and 
1037.745.
    (v) If a manufacturer certifies a vehicle family to an FEL that 
exceeds the otherwise applicable standard, it must obtain enough FCC to 
offset the vehicle family's deficit by the due date of its final report 
required in Sec.  535.8. The emission credits used to address the 
deficit may come from other vehicle families that generate FCCs in the 
same model year (or from the next three subsequent model years), from 
banked FCCs from previous model years, or from FCCs generated in the 
same or previous model years that it obtained through trading. Note 
that the option for using banked or traded credits does not apply for 
trailers.
    (vi) Manufacturers may certify a vehicle or engine family using an 
FEL (as described in Sec.  535.6) below the fuel consumption standard 
(as described in Sec.  535.5) and choose not to generate conventional 
fuel consumption credits for that family. Manufacturers do not need to 
calculate fuel consumption credits for those families and do not need 
to submit or keep the associated records described in Sec.  535.8 for 
these families. Manufacturers participating in NHTSA's FCC program must 
provide reports as specified in Sec.  535.8.
    (3) Banking. Banking is the retention of surplus FCC in an 
averaging set by the manufacturer for use in future model years for the 
purpose of averaging or trading.
    (i) Surplus credits may be banked by the manufacturer for use in 
future model years, or traded, given the restriction that the credits 
have an expiration date of five model years after the year in which the 
credits are generated. For example, banked credits earned in model year 
2014 may be utilized through model year 2019. Surplus credits will 
become banked credits unless a manufacturer contacts NHTSA to expire 
its credits.
    (ii) Surplus credits become earned or usable banked FCCs when the 
manufacturer's final report is approved by both agencies. However, the 
agencies may revoke these FCCs at any time if they are unable to verify 
them after reviewing the manufacturer's reports or auditing its 
records.
    (iii) Banked FCC retain the designation from the averaging set and 
model year in which they were generated.
    (iv) Banked credits retain the designation of the averaging set in 
which they were generated.
    (v) Trailer manufacturers generating credits in paragraph (e) of 
this section may not bank credits except to resolve credit deficits in 
the same model year or from up to three prior model years.
    (4) Trading. Trading is a transaction that transfers banked FCCs 
between manufacturers or other entities in the same averaging set. A 
manufacturer may use traded FCCs for averaging, banking, or further 
trading transactions.
    (i) Manufacturers may only trade banked credits to other 
manufacturers to use for compliance with fuel consumption standards. 
Traded FCCs, other than advanced technology credits, may be used only 
within the averaging set in which they were generated. Manufacturers 
may only trade credits to other entities for the purpose of expiring 
credits.
    (ii) Advanced technology credits can be traded across different 
averaging sets.
    (iii) The agencies may revoke traded FCCs at any time if they are 
unable to verify them after reviewing the manufacturer's reports or 
auditing its records.

[[Page 74261]]

    (iv) If a negative FCC balance results from a transaction, both the 
buyer and seller are liable, except in cases the agencies deem to 
involve fraud. See Sec.  535.9 for cases involving fraud. EPA also may 
void the certificates of all vehicle families participating in a trade 
that results in a manufacturer having a negative balance of emission 
credits. See 40 CFR 1037.745.
    (v) Trailer manufacturers generating credits in paragraph (e) of 
this section starting in model year 2027 may not bank or trade credits. 
These manufacturers may only use credits for the purpose of averaging.
    (vi) Manufacturers with deficits or projecting deficits before or 
during a production model year may not trade credits until its 
available credits exceed the deficit. Manufacturers with a deficit may 
not trade credits if the deadline to offset that credit deficit has 
passed.
    (5) Credit deficit (or credit shortfall). A credit shortfall or 
deficit occurs when the sum of the manufacturer's generated credits for 
engines or vehicle families or fleets within an averaging set is 
negative. Credit shortfalls must be offset by an available credit 
surplus within three model years after the shortfall was incurred. If 
the shortfall cannot be offset, the manufacturer is liable for civil 
penalties as discussed in Sec.  535.9.
    (6) FCC credit plan. (i) Each model year manufacturers submit 
credit plan in their certificates of conformity as required in 40 CFR 
1036.725(b)(2) and 40 CFR 1037.725(b)(2). The plan is required to 
contain equivalent fuel consumption information in accordance Sec.  
535.8(c). The plan must include:
    (A) Detailed calculations of projected emission and fuel 
consumption credits (positive or negative) based on projected U.S.-
directed production volumes. The agencies may require a manufacturer to 
include similar calculations from its other engine or vehicle families 
to project its net credit balances for the model year. If a 
manufacturer projects negative emission and/or fuel consumption credits 
for a family, it must state the source of positive emission and/or fuel 
consumption credits it expects to use to offset the negative credits 
demonstrating how it plans to resolve any credit deficits that might 
occur for a model year within a period of up to three model years after 
that deficit has occurred.
    (B) Actual emissions and fuel consumption credit balances, credit 
transactions, and credit trades.
    (ii) Manufacturers are required to provide updated credit plans 
after receiving their final verified reports from EPA and NHTSA after 
the end of each model year.
    (iii) The agencies may determine that a manufacturer's plan is 
unreasonable or unrealistic based on a consideration of past and 
projected use of specific technologies, the historical sales mix of its 
vehicle models, subsequent failure to follow any submitted plans, and 
limited expected access to traded credits.
    (iv) The agencies may also consider the plan unreasonable if the 
manufacturer's credit deficit increases from one model year to the 
next. The agencies may require that the manufacturers must send interim 
reports describing its progress toward resolving its credit deficit 
over the course of a model year.
    (v) If NHTSA determines that a manufacturers plan is unreasonable 
or unrealistic, the manufacturer is deemed as not comply with fuel 
consumption standards as specified in Sec.  535.10(c) and the 
manufacturer may be liable for civil penalties.
    (7) Revoked credits. NHTSA may revoke fuel consumption credits if 
unable to verify any information after auditing reports or records or 
conducting confirmatory testing. In the cases where EPA revokes 
emissions CO2 credits, NHTSA will revoke the equivalent 
amount of fuel consumption credits.
    (8) Transition to Phase 2 standards. The following provisions allow 
for enhanced use of fuel consumption credits from Phase 1 tractors and 
vocational vehicles for meeting the Phase 2 standards:
    (i) Fuel consumption credits a manufacturer generates for light and 
medium heavy-duty vocational vehicles in model years 2018 through 2021 
may be used through model year 2027, instead of being limited to a 
five-year credit life as specified in this part.
    (ii) The manufacturer may use the off-cycle provisions of paragraph 
(f) of this section to apply technologies to Phase 1 vehicles as 
follows:
    (A) A manufacturer may apply an improvement factor of 0.988 for 
tractors and vocational vehicles with automatic tire inflation systems 
on all axles.
    (B) For vocational vehicles with automatic engine shutdown systems 
that conform with 40 CFR 1037.660, a manufacturer may apply an 
improvement factor of 0.95.
    (C) For vocational vehicles with stop-start systems that conform 
with 40 CFR 1037.660, a manufacturer may apply an improvement factor of 
0.92.
    (D) For vocational vehicles with neutral-idle systems conforming 
with 40 CFR 1037.660, manufacturers may apply an improvement factor of 
0.98. Manufacturers may adjust this improvement factor if we approve a 
partial reduction under 40 CFR 1037.660(a)(2); for example, if the 
manufacturer's design reduces fuel consumption by half as much as 
shifting to neutral, it may apply an improvement factor of 0.99.
    (9) Credits for small business manufacturers. Small manufacturers 
may generate fuel consumption credits for natural gas-fueled vocational 
vehicles as follows:
    (i) Small manufacturers may certify their vehicles instead of 
relying on the exemption of Sec.  535.3.
    (ii) Use Phase 1 GEM to determine a fuel consumption level for 
vehicle, then multiply this value by the engine's FCL for fuel 
consumption and divide by the engine's applicable fuel consumption 
standard.
    (iii) Use the value determined in paragraph (ii) in the credit 
equation specified in part (c) of this section in place of the term 
(Std - FEL).
    (iv) The following provisions apply uniquely to small businesses 
under the custom-chassis standards of Sec.  535.5(b)(6):
    (A) Manufacturers may use fuel consumption credits generated under 
paragraph (c) of this section, including banked or traded credits from 
any averaging set. Such credits remain subject to other limitations 
that apply under this part.
    (B) Manufacturers may produce up to 200 drayage tractors in a given 
model year to the standards described in Sec.  535.5(b)(6) for ``other 
buses''. Treat these drayage tractors as being in their own averaging 
set.
    (10) Certifying non-gasoline engines. A manufacturer producing non-
gasoline engines complying with model year 2021 or later medium heavy-
duty spark-ignition standards may not generate fuel consumption 
credits. Only manufacturers producing gasoline engines certifying to 
spark-ignition standards can generate fuel consumption credits under 
paragraph (d) of this part.
    (b) ABT provisions for heavy-duty pickup trucks and vans. (1) 
Calculate fuel consumption credits in a model year for one fleet of 
conventional heavy-duty pickup trucks and vans and if designated by the 
manufacturer another consisting of advance technology vehicles for the 
averaging set as defined in Sec.  535.4. Calculate credits for each 
fleet separately using the following equation:

Total MY Fleet FCC (gallons) = (Std - Act) x (Volume) x (UL) x (10\2\)

Where:

Std = Fleet average fuel consumption standard (gal/100 mile).

[[Page 74262]]

Act = Fleet average actual fuel consumption value (gal/100 mile).
Volume = the total U.S.-directed production of vehicles in the 
regulatory subcategory.
UL = the useful life for the regulatory subcategory. The useful life 
value for heavy-pickup trucks and vans manufactured for model years 
2013 through 2020 is equal to the 120,000 miles. The useful life for 
model years 2021 and later is equal to 150,000 miles.

    (2) Adjust the fuel consumption performance of subconfigurations 
with advanced technology for determining the fleet average actual fuel 
consumption value as specified in paragraph (f)(1) of this section and 
40 CFR 86.1819-14(d)(7). Advanced technology vehicles can be separated 
in a different fleet for the purpose of applying credit incentives as 
described in paragraph (f)(1) of this section.
    (3) Adjust the fuel consumption performance for subconfigurations 
with innovative technology. A manufacturer is eligible to increase the 
fuel consumption performance of heavy-duty pickup trucks and vans in 
accordance with procedures established by EPA set forth in 40 CFR part 
600. The eligibility of a manufacturer to increase its fuel consumption 
performance through use of an off-cycle technology requires an 
application request made to EPA and NHTSA in accordance with 40 CFR 
86.1869-12 and an approval granted by the agencies. For off-cycle 
technologies that are covered under 40 CFR 86.1869-12, NHTSA will 
collaborate with EPA regarding NHTSA's evaluation of the specific off-
cycle technology to ensure its impact on fuel consumption and the 
suitability of using the off-cycle technology to adjust fuel 
consumption performance. NHTSA will provide its views on the 
suitability of the technology for that purpose to EPA. NHTSA will apply 
the criteria in section (f) of this section in granting or denying off-
cycle requests.
    (4) Fuel consumption credits may be generated for vehicles 
certified in model year 2013 to the model year 2014 standards in Sec.  
535.5(a). If a manufacturer chooses to generate CO2 emission 
credits under EPA's provisions in 40 CFR part 86, it may also 
voluntarily generate early credits under the NHTSA fuel consumption 
program. To do so, a manufacturer must certify its entire U.S.-directed 
production volume of vehicles in its fleet. The same production volume 
restrictions specified in 40 CFR 1037.150(a)(2) relating to when test 
groups are certified apply to the NHTSA early credit provisions. 
Credits are calculated as specified in paragraph (b)(3) of this section 
relative to the fleet standard that would apply for model year 2014 
using the model year 2013 production volumes. Surplus credits generated 
under this paragraph (b)(4) are available for banking or trading. 
Credit deficits for an averaging set prior to model year 2014 do not 
carry over to model year 2014. These credits may be used to show 
compliance with the standards of this part for 2014 and later model 
years. Once a manufacturer opts into the NHTSA program they must stay 
in the program for all of the optional model years and remain 
standardized with the same implementation approach being followed to 
meet the EPA CO2 emission program.
    (5) Calculate the averaging set credit value by summing together 
the fleet credits for conventional and advanced technology vehicles 
including any adjustments for innovative technologies. Manufacturers 
may sum conventional and innovative technology credits before adding 
any advanced technology credits in each averaging set.
    (6) For credits that manufacturers calculate based on a useful life 
of 120,000 miles, multiply any banked credits carried forward for use 
in model year 2021 and later by 1.25. For credit deficits that a 
manufacturer calculates based on a useful life of 120,000 miles and 
that it offsets with credits originally earned in model year 2021 and 
later, it multiplies the credit deficit by 1.25.
    (c) ABT provisions for vocational vehicles and tractors. (1) 
Calculate the fuel consumption credits in a model year for each 
participating family or subfamily consisting of conventional vehicles 
in each averaging set (as defined in Sec.  535.4) using the equation in 
this section. Each designated vehicle family or subfamily has a 
``family emissions limit'' (FEL) that is compared to the associated 
regulatory subcategory standard. An FEL that falls below the regulatory 
subcategory standard creates ``positive credits,'' while fuel 
consumption level of a family group above the standard creates a 
``negative credits.'' The value of credits generated for each family or 
subfamily in a model year is calculated as follows and must be rounded 
to nearest whole number:

    Vehicle Family FCC (gallons) = (Std - FEL) x (Payload) x (Volume) x 
(UL) x (10\3\)

Where:

Std = the standard for the respective vehicle family regulatory 
subcategory (gal/1000 ton-mile).
FEL = family emissions limit for the vehicle family (gal/1000 ton-
mile).
Payload = the prescribed payload in tons for each regulatory 
subcategory as shown in the following table:

------------------------------------------------------------------------
                 Regulatory subcategory                   Payload (tons)
------------------------------------------------------------------------
Vocational LHD Vehicles.................................            2.85
Vocational MHD Vehicles.................................            5.60
Vocational HHD Vehicles.................................             7.5
MDH Tractors............................................           12.50
HHD Tractors, other than heavy-haul Tractors............           19.00
Heavy-haul Tractors.....................................           43.00
------------------------------------------------------------------------

Volume = the number of U.S.-directed production volume of vehicles 
in the corresponding vehicle family.
UL = the useful life for the regulatory subcategory (miles) as shown 
in the following table:

------------------------------------------------------------------------
         Regulatory subcategory                     UL  (miles)
------------------------------------------------------------------------
LHD Vehicles............................  110,000 (Phase 1).
                                          150,000 (Phase 2).
Vocational MHD Vehicles and tractors at   185,000.
 or below 33,000 pounds GVWR.
Vocation HHD Vehicles and tractors at or  435,000.
 above 33,000 pounds GVWR.
------------------------------------------------------------------------

    (i) Calculate the value of credits generated in a model year for 
each family or subfamily consisting of vehicles with advanced 
technology vehicles in each averaging set using the equation above and 
the guidelines provided in paragraph (f)(1) of this section. 
Manufacturers may generate credits for advanced technology vehicles 
using incentives specified in paragraph (f)(1) of this section.
    (ii) Calculate the value of credits generated in a model year for 
each family or subfamily consisting of vehicles with off-cycle 
technology vehicles in each averaging set using the equation above and 
the guidelines provided in paragraph (f)(2) of this section.
    (2) Manufacturers must sum all negative and positive credits for 
each vehicle family within each applicable averaging set to obtain the 
total credit balance for the model year before rounding. The sum of 
fuel consumptions credits must be rounded to the nearest gallon. 
Calculate the total credits generated in a model year for each 
averaging set using the following equation:

Total averaging set MY credits = [Sigma] Vehicle family credits within 
each averaging set

    (3) Manufacturers can sum conventional and innovative technology 
credits before adding any advanced technology credits in each averaging 
set.
    (4) If a manufacturer chooses to generate CO2 emission 
credits under

[[Page 74263]]

EPA provisions of 40 CFR 1037.150(a), it may also voluntarily generate 
early credits under the NHTSA fuel consumption program as follows:
    (i) Fuel consumption credits may be generated for vehicles 
certified in model year 2013 to the model year 2014 standards in Sec.  
535.5(b) and (c). To do so, a manufacturer must certify its entire 
U.S.-directed production volume of vehicles. The same production volume 
restrictions specified in 40 CFR 1037.150(a)(1) relating to when test 
groups are certified apply to the NHTSA early credit provisions. 
Credits are calculated as specified in paragraph (c)(11) of this 
section relative to the standards that would apply for model year 2014. 
Surplus credits generated under this paragraph (c)(4) may be increased 
by a factor of 1.5 for determining total available credits for banking 
or trading. For example, if a manufacturer has 10 gallons of surplus 
credits for model year 2013, it may bank 15 gallons of credits. Credit 
deficits for an averaging set prior to model year 2014 do not carry 
over to model year 2014. These credits may be used to show compliance 
with the standards of this part for 2014 and later model years. Once a 
manufacturer opts into the NHTSA program they must stay in the program 
for all of the optional model years and remain standardized with the 
same implementation approach being followed to meet the EPA 
CO2 emission program.
    (ii) A tractor manufacturer may generate fuel consumption credits 
for the number of additional SmartWay designated tractors (relative to 
its MY 2012 production), provided that credits are not generated for 
those vehicles under paragraph (c)(4)(i) of this section. Calculate 
credits for each regulatory sub-category relative to the standard that 
would apply in model year 2014 using the equations in paragraph (c)(2) 
of this section. Use a production volume equal to the number of 
verified model year 2013 SmartWay tractors minus the number of verified 
model year 2012 SmartWay tractors. A manufacturer may bank credits 
equal to the surplus credits generated under this paragraph multiplied 
by 1.50. A manufacturer's 2012 and 2013 model years must be equivalent 
in length. Once a manufacturer opts into the NHTSA program they must 
stay in the program for all of the optional model years and remain 
standardized with the same implementation approach being followed to 
meet the EPA CO2 emission program.
    (5) If a manufacturer generates credits from vehicles certified for 
advanced technology in accordance with paragraph (e)(1) of this 
section, a multiplier of 1.5 can be used, but this multiplier cannot be 
used on the same credits for which the early credit multiplier is used.
    (6) For model years 2012 and later, manufacturers may generate or 
use fuel consumption credits for averaging to demonstrate compliance 
with the alternative standards as described in Sec.  535.5(b)(6) of 
this part. Manufacturers can specify a Family Emission Limit (FEL) for 
fuel consumption for each vehicle subfamily. The FEL may not be less 
than the result of emissions and fuel consumption modeling as described 
in 40 CFR 1037.520 and Sec.  535.6. These FELs serve as the fuel 
consumption standards for the vehicle subfamily instead of the 
standards specified in this Sec.  535.5(b)(6). Manufacturers may not 
use averaging for motor homes, coach buses, emergency vehicles or 
concrete mixers meeting standards under Sec.  535.5(b)(5).
    (7) Manufacturers may not use averaging for vehicles meeting 
standards Sec.  535.5(b)(6)(iv) through (vi), and manufacturers may not 
use fuel consumption credits for banking or trading for any vehicles 
certified under Sec.  535.5(b)(6).
    (8) Manufacturers certifying any vehicles under Sec.  535.5(b)(6) 
must consider each separate vehicle type (or group of vehicle types) as 
a separate averaging set.
    (d) ABT provisions for heavy-duty engines. (1) Calculate the fuel 
consumption credits in a model year for each participating family or 
subfamily consisting of engines in each averaging set (as defined in 
Sec.  535.4) using the equation in this section. Each designated engine 
family has a ``family certification level'' (FCL) which is compared to 
the associated regulatory subcategory standard. A FCL that falls below 
the regulatory subcategory standard creates ``positive credits,'' while 
fuel consumption level of a family group above the standard creates a 
``credit shortfall.'' The value of credits generated in a model year 
for each engine family or subfamily is calculated as follows and must 
be rounded to nearest whole number:

Engine Family FCC (gallons) = (Std - FCL) x (CF) x (Volume) x (UL) x 
(10\2\)

Where:

Std = the standard for the respective engine regulatory subcategory 
(gal/100 hp-hr).
FCL = family certification level for the engine family (gal/100 hp-
hr).
CF = a transient cycle conversion factor in hp-hr/mile which is the 
integrated total cycle horsepower-hour divided by the equivalent 
mileage of the applicable test cycle. For engines subject to spark-
ignition heavy-duty standards, the equivalent mileage is 6.3 miles. 
For engines subject to compression-ignition heavy-duty standards, 
the equivalent mileage is 6.5 miles.
Volume = the number of engines in the corresponding engine family.
UL = the useful life of the given engine family (miles) as shown in 
the following table:

------------------------------------------------------------------------
         Regulatory subcategory                     UL  (miles)
------------------------------------------------------------------------
SI and CI LHD Engines...................  120,000 (Phase 1).
                                          150,000 (Phase 2).
CI MHD Engines..........................  185,000.
CI HHD Engines..........................  435,000.
------------------------------------------------------------------------

    (i) Calculate the value of credits generated in a model year for 
each family or subfamily consisting of engines with advanced technology 
vehicles in each averaging set using the equation above and the 
guidelines provided in paragraph (f)(1) of this section. Manufacturers 
may generate credits for advanced technology vehicles using incentives 
specified in paragraph (f)(1) of this section.
    (ii) Calculate the value of credits generated in a model year for 
each family or subfamily consisting of engines with off-cycle 
technology vehicles in each averaging set using the equation above and 
the guidelines provided in paragraph (f)(2) of this section.
    (2) Manufacturers shall sum all negative and positive credits for 
each engine family within the applicable averaging set to obtain the 
total credit balance for the model year before rounding. The sum of 
fuel consumptions credits should be rounded to the nearest gallon.
    Calculate the total credits generated in a model year for each 
averaging set using the following equation:

Total averaging set MY credits = [Sigma] Engine family credits within 
each averaging set

    (3) The provisions of this section apply to manufacturers utilizing 
the compression-ignition engine voluntary alternate standard provisions 
specified in Sec.  535.5(d)(4) as follows:
    (i) Manufacturers may not certify engines to the alternate 
standards if they are part of an averaging set in which they carry a 
balance of banked credits. For purposes of this section, manufacturers 
are deemed to carry credits in an averaging set if they carry credits 
from advance technology that are allowed to be used in that averaging 
set.
    (ii) Manufacturers may not bank fuel consumption credits for any 
engine

[[Page 74264]]

family in the same averaging set and model year in which it certifies 
engines to the alternate standards. This means a manufacturer may not 
bank advanced technology credits in a model year it certifies any 
engines to the alternate standards.
    (iii) Note that the provisions of paragraph (d)(10) of this section 
apply with respect to credit deficits generated while utilizing 
alternate standards.
    (4) Where a manufacturer has chosen to comply with the EPA 
alternative compression-ignition engine phase-in standard provisions in 
40 CFR 1036.150(e), and has optionally decided to follow the same path 
under the NHTSA fuel consumption program, it must certify all of its 
model year 2013 compression-ignition engines within a given averaging 
set to the applicable alternative standards in Sec.  535.5(d)(5). 
Engines certified to these standards are not eligible for early credits 
under paragraph (d)(14) of this section. Credits are calculated using 
the same equation provided in paragraph (d)(11) of this section.
    (5) If a manufacturer chooses to generate early CO2 
emission credits under EPA provisions of 40 CFR 1036.150, it may also 
voluntarily generate early credits under the NHTSA fuel consumption 
program. Fuel consumption credits may be generated for engines 
certified in model year 2013 (2015 for spark-ignition engines) to the 
standards in Sec.  535.5(d). To do so, a manufacturer must certify its 
entire U.S.-directed production volume of engines except as specified 
in 40 CFR 1036.150(a)(2). Credits are calculated as specified in 
paragraph (d)(11) of this section relative to the standards that would 
apply for model year 2014 (2016 for spark-ignition engines). Surplus 
credits generated under this paragraph (d)(3) may be increased by a 
factor of 1.5 for determining total available credits for banking or 
trading. For example, if a manufacturer has 10 gallons of surplus 
credits for model year 2013, it may bank 15 gallons of credits. Credit 
deficits for an averaging set prior to model year 2014 (2016 for spark-
ignition engines) do not carry over to model year 2014 (2016 for spark-
ignition engines). These credits may be used to show compliance with 
the standards of this part for 2014 and later model years. Once a 
manufacturer opts into the NHTSA program they must stay in the program 
for all of the optional model years and remain standardized with the 
same implementation approach being followed to meet the EPA 
CO2 emission program.
    (6) Manufacturers may generate fuel consumption credits from an 
engine family subject to spark-ignition standards for exchanging with 
other engine families only if the engines in the family are gasoline-
fueled.
    (7) Engine credits generated for compression-ignition engines in 
the 2020 and earlier model years may be used in model year 2021 and 
later only if the credit-generating engines were certified to the 
tractor standards in Sec.  535.5(d) and 40 CFR 1036.108. Manufacturers 
may otherwise use fuel consumption credits generated in one model year 
without adjustment for certifying vehicles in a later model year, even 
if fuel consumption standards are different.
    (8) Engine families manufacturers certify with a nonconformance 
penalty under 40 CFR part 86, subpart L, and may not generate fuel 
consumption credits.
    (9) Alternate transition option for Phase 2 engine standards. The 
following provisions allow for enhanced generation and use of fuel 
consumption credits for manufacturers complying with engines standards 
in accordance with Sec.  535.7(d)(11):
    (i) If a manufacturer is eligible to certify all of its model year 
2020 engines within the averaging set to the tractor and vocational 
vehicle engine standards in Sec.  535.5(d)(11) and the requirements 
applicable to model year 2021 engines, the banked and traded fuel 
consumption credits generated for model year 2018 through 2024 engines 
may be used through model year 2030 as specified in paragraph 
(d)(9)(ii) of this section or through a five-year credit life, 
whichever is later.
    (ii) Banked and traded fuel consumption credits generated under 
this paragraph (d)(9) for model year 2018 through 2024 engines may be 
used through model year 2030 with the extended credit life values shown 
in the table:

------------------------------------------------------------------------
                                                        Credit life for
                                                       transition option
                      Model year                          for phase 2
                                                        engine standards
                                                            (years)
------------------------------------------------------------------------
2018.................................................                 12
2019.................................................                 11
2020.................................................                 10
2021.................................................                  9
2022.................................................                  8
2023.................................................                  7
2024.................................................                  6
2025 and later.......................................                  5
------------------------------------------------------------------------

    (e) ABT provisions for trailers. (1) Manufacturers cannot use 
averaging for non-box trailers, partial-aero trailers, or non-aero 
trailers or cannot use fuel consumption credits for banking or trading. 
Starting in model year 2027, full aero box van manufactures may 
average, credits.
    (2) Calculate the fuel consumption credits in a model year for each 
participating family or subfamily consisting of full aero box trailers 
(vehicles) in each averaging set (as defined in Sec.  535.4) using the 
equation in this section. Each designated vehicle family or subfamily 
has a ``family emissions limit'' (FEL) which is compared to the 
associated regulatory subcategory standard. An FEL that falls below the 
regulatory subcategory standard creates ``positive credits,'' while 
fuel consumption level of a family group above the standard creates a 
``negative credits.'' The value of credits generated for each family or 
subfamily in a model year is calculated as follows and must be rounded 
to nearest whole number:

Vehicle Family FCC (gallons) = (Std - FEL) x (Payload) x (Volume) x 
(UL) x (10\3\)


Where:

Std = the standard for the respective vehicle family regulatory 
subcategory (gal/1000 ton-mile).
FEL = family emissions limit for the vehicle family (gal/1000 ton-
mile).
Payload = 10 tons for short box vans and 19 tons for other trailers.
Volume = the number of U.S.-directed production volume of vehicles 
in the corresponding vehicle family.
UL = the useful life for the regulatory subcategory. The useful life 
value for heavy-duty trailers is equal to the 250,000 miles.

    (3) Trailer manufacturers may not generate advanced technology 
credits.
    (4) Manufacturers shall sum all negative and positive credits for 
each vehicle family within the applicable averaging set to obtain the 
total credit balance for the model year before rounding. Calculate the 
total credits generated in a model year for each averaging set using 
the following equation:

Total averaging set MY credits = [Sigma] Vehicle family credits within 
each averaging set

    (5) Trailer manufacturers may not bank credits within an averaging 
set but surplus fuel consumption credits from a given model year may be 
used to offset deficits from earlier model years.
    (f) Additional credit provisions--(1) Advanced technology credits. 
(i) For the Phase 1 program, manufacturers of heavy-duty pickup trucks 
and vans, vocational vehicles, tractors and the associated engines 
showing improvements in CO2 emissions and fuel consumption 
using hybrid vehicles

[[Page 74265]]

with regenerative braking, vehicles equipped with Rankine-cycle 
engines, electric vehicles and fuel cell vehicles are eligible for 
advanced technology credits. Manufacturers shall use sound engineering 
judgment to determine the performance of the vehicle or engine with 
advanced technology. Advanced technology credits for vehicles or 
engines complying with Phase 1 standards may be increased by a 1.5 
multiplier. Manufacturers may not apply this multiplier in addition to 
any early-credit multipliers. The maximum amount of credits a 
manufacturer may bring into the service class group that contains the 
heavy-duty pickup and van averaging set is 5.89 [middot] 10\6\ gallons 
(for advanced technology credits based upon compression-ignition 
engines) or 6.76 [middot] 10\6\ gallons (for advanced technology 
credits based upon spark-ignition engines) per model year as specified 
in 40 CFR part 86 for heavy-duty pickup trucks and vans, 40 CFR 
1036.740 for engines and 40 CFR 1037.740 for tractors and vocational 
vehicles. The specified limit does not cap the amount of advanced 
technology credits that can be used across averaging sets within the 
same service class group. Advanced technology credits can be used to 
offset negative credits in the same averaging set or other averaging 
sets. A manufacturer must first apply advanced technology credits to 
any deficits in the same averaging set before applying them to other 
averaging.
    (A) Heavy-duty pickup trucks and vans. For advanced technology 
systems (hybrid vehicles with regenerative braking, vehicles equipped 
with Rankine-cycle engines and fuel cell vehicles), calculate fleet-
average performance rates consistent with good engineering judgment and 
the provisions of 40 CFR 86.1819-14 and 86.1865.
    (B) Tractors and vocational vehicles. For advanced technology 
system (hybrid vehicles with regenerative braking, vehicles equipped 
with Rankine-cycle engines and fuel cell vehicles), calculate the 
advanced technology credits as follows:
    (1) Measure the effectiveness of the advanced system by conducting 
A to B testing a vehicle equipped with the advanced system and an 
equivalent conventional system in accordance with 40 CFR 1037.615.
    (2) For purposes of this paragraph (f), a conventional vehicle is 
considered to be equivalent if it has the same footprint, intended 
vehicle service class, aerodynamic drag, and other relevant factors not 
directly related to the advanced system powertrain. If there is no 
equivalent vehicle, the manufacturer may create and test a prototype 
equivalent vehicle. The conventional vehicle is considered Vehicle A, 
and the advanced technology vehicle is considered Vehicle B.
    (3) The benefit associated with the advanced system for fuel 
consumption is determined from the weighted fuel consumption results 
from the chassis tests of each vehicle using the following equation:

Benefit (gallon/1000 ton mile) = Improvement Factor x GEM Fuel 
Consumption Result_B

Where:

Improvement Factor = (Fuel Consumption_A-Fuel Consumption_B)/(Fuel 
Consumption_A).
Fuel Consumption Rates A and B are the gallons per 1000 ton-mile of 
the conventional and advanced vehicles, respectively as measured 
under the test procedures specified by EPA. GEM Fuel Consumption 
Result B is the estimated gallons per 1000 ton-mile rate resulting 
from emission modeling of the advanced vehicle as specified in 40 
CFR 1037.520 and Sec.  535.6(b).

    (4) Calculate the benefit in credits using the equation in 
paragraph (c) of this section and replacing the term (Std-FEL) with the 
benefit.
    (5) For electric vehicles calculate the fuel consumption credits 
using an FEL of 0 g/1000 ton-mile.
    (C) Heavy-duty engines. This section specifies how to generate 
advanced technology-specific fuel consumption credits for hybrid 
powertrains that include energy storage systems and regenerative 
braking (including regenerative engine braking) and for engines that 
include Rankine-cycle (or other bottoming cycle) exhaust energy 
recovery systems.
    (1) Pre-transmission hybrid powertrains are those engine systems 
that include features that recover and store energy during engine 
motoring operation but not from the vehicle wheels. These powertrains 
are tested using the hybrid engine test procedures of 40 CFR part 1065 
or using the post-transmission test procedures.
    (2) Post-transmission hybrid powertrains are those powertrains that 
include features that recover and store energy from braking at the 
vehicle wheels. These powertrains are tested by simulating the chassis 
test procedure applicable for hybrid vehicles under 40 CFR 1037.550.
    (3) Test engines that include Rankine-cycle exhaust energy recovery 
systems according to the test procedures specified in 40 CFR part 1036, 
subpart F, unless EPA approves the manufacturer's alternate procedures.
    (D) Credit calculation. Calculate credits as specified in paragraph 
(c) of this section. Credits generated from engines and powertrains 
certified under this section may be used in other averaging sets as 
described in 40 CFR 1036.740(d).
    (ii) There are no separate credit allowances for advanced 
technology vehicles in the Phase 2 program. Instead, vehicle families 
containing plug-in battery electric hybrids, all-electric, and fuel 
cell vehicles certifying to Phase 2 vocational and tractor standards 
may multiply credits by a multiplier of:
    (A) 3.5 times for plug-in hybrid electric vehicles;
    (B) 4.5 times for all-electric vehicles; and
    (C) 5.5 times for fuel cell vehicles.
    (D) Incentivized credits for vehicles equipped with advanced 
technologies maintain the same credit flexibilities and restrictions as 
conventional credits specified in paragraph (a) of this section during 
the Phase 2 program.
    (E) For vocational vehicles and tractors subject to Phase 2 
standards, create separate vehicle families if there is a credit 
multiplier for advanced technology; group those vehicles together in a 
vehicle family if they use the same multiplier.
    (F) For Phase 2 plug-in hybrid electric vehicles and for fuel cells 
powered by any fuel other than hydrogen, calculate fuel consumption 
credits using an FEL based on equivalent emission measurements from 
powertrain testing. Phase 2 advanced-technology credits do not apply 
for hybrid vehicles that have no plug-in capability.
    (2) Innovative and off-cycle technology credits. This provision 
allows fuel saving innovative and off-cycle engine and vehicle 
technologies to generate fuel consumption credits comparable to 
CO2 emission credits consistent with the provisions of 40 
CFR 86.1819-14(d)(13) (for heavy-duty pickup trucks and vans), 40 CFR 
1036.610 (for engines), and 40 CFR 1037.610 (for vocational vehicles 
and tractors).
    (i) For model years 2013 through 2020, manufacturers may generate 
innovative technology credits for introducing technologies that were 
not in-common use for heavy-duty tractor, vocational vehicles or 
engines before model year 2010 and that are not reflected in the EPA 
specified test procedures. Upon identification and joint approval with 
EPA, NHTSA will allow equivalent fuel consumption credits into its 
program to those allowed by EPA for manufacturers seeking to obtain 
innovative technology credits in

[[Page 74266]]

a given model year. Such credits must remain within the same regulatory 
subcategory in which the credits were generated. NHTSA will adopt fuel 
consumption credits depending upon whether--
    (A) The technology has a direct impact upon reducing fuel 
consumption performance; and
    (B) The manufacturer has provided sufficient information to make 
sound engineering judgments on the impact of the technology in reducing 
fuel consumption performance.
    (ii) For model years 2021 and later, manufacturers may generate 
off-cycle technology credits for introducing technologies that are not 
reflected in the EPA specified test procedures. Upon identification and 
joint approval with EPA, NHTSA will allow equivalent fuel consumption 
credits into its program to those allowed by EPA for manufacturers 
seeking to obtain innovative technology credits in a given model year. 
Such credits must remain within the same regulatory subcategory in 
which the credits were generated. NHTSA will adopt fuel consumption 
credits depending upon whether--
    (A) The technology meets paragraph (f)(2)(i)(A) and (B) of this 
section.
    (B) For heavy-duty pickup trucks and vans, manufacturers using the 
5-cycle test to quantify the benefit of a technology are not required 
to obtain approval from the agencies to generate results.
    (iii) The following provisions apply to all innovative and off-
cycle technologies:
    (A) Technologies found to be defective, or identified as a part of 
NHTSA's safety defects program, and technologies that are not 
performing as intended will have the values of approved off-cycle 
credits removed from the manufacturer's credit balance.
    (B) Approval granted for innovative and off-cycle technology 
credits under NHTSA's fuel efficiency program does not affect or 
relieve the obligation to comply with the Vehicle Safety Act (49 U.S.C. 
Chapter 301), including the ``make inoperative'' prohibition (49 U.S.C. 
30122), and all applicable Federal motor vehicle safety standards 
issued thereunder (FMVSSs) (49 CFR part 571). In order to generate off-
cycle or innovative technology credits manufacturers must state--
    (1) That each vehicle equipped with the technology for which they 
are seeking credits will comply with all applicable FMVSS(s); and
    (2) Whether or not the technology has a fail-safe provision. If no 
fail-safe provision exists, the manufacturer must explain why not and 
whether a failure of the innovative technology would affect the safety 
of the vehicle.
    (C) Manufacturers requesting approval for innovative technology 
credits are required to provide documentation in accordance with 40 CFR 
86.1869-12, 1036.610, and 1037.610.
    (D) Credits will be accepted on a one-for-one basis expressed in 
terms of gallons in comparison to those approved by EPA.
    (E) For the heavy-duty pickup trucks and vans, the average fuel 
consumption will be calculated as a separate credit amount (rounded to 
the nearest whole number) using the following equation:

Off-cycle FC credits = (CO2 Credit/CF) x 100 x Production x 
VLM

Where:

CO2 Credits = the credit value in grams per mile 
determined in 40 CFR 86.1869-12(c)(3), (d)(1), (d)(2) or (d)(3).
CF = conversion factor, which for spark-ignition engines is 8,887 
and for compression-ignition engines is 10,180.
Production = the total production volume for the applicable category 
of vehicles.
VLM = vehicle lifetime miles, which for 2b-3 vehicles shall be 
150,000 for the Phase 2 program.
The term (CO2 Credit/CF) should be rounded to the nearest 
0.0001.

    (F) NHTSA will not approve innovative technology credits for 
technology that is related to crash-avoidance technologies, safety 
critical systems or systems affecting safety-critical functions, or 
technologies designed for the purpose of reducing the frequency of 
vehicle crashes.
    (iv) Manufacturers normally may not calculate off-cycle credits or 
improvement factors under this section for technologies represented by 
GEM, but the agencies may allow a manufacturer to do so by averaging 
multiple GEM runs for special technologies for which a single GEM run 
cannot accurately reflect in-use performance. For example, if a 
manufacturer use an idle-reduction technology that is effective 80 
percent of the time, the agencies may allow a manufacturer to run GEM 
with the technology active and with it inactive, and then apply an 80% 
weighting factor to calculate the off-cycle credit or improvement 
factor. A may need to perform testing to establish proper weighting 
factors or otherwise quantify the benefits of the special technologies.
    (v) A manufacturer may apply the off-cycle provisions of this 
paragraph (2) and 40 CFR 1037.610 to trailers as early as model year 
2018 as follows:
    (A) A manufacturer may account for weight reduction based on 
measured values instead of using the weight reductions specified in 40 
CFR 1037.515. Quantify the weight reduction by measuring the weight of 
a trailer in a certified configuration and comparing it to the weight 
of an equivalent trailer without weight-reduction technologies. This 
qualifies as A to B testing this part. Use good engineering judgment to 
select an equivalent trailer representing a baseline configuration. Use 
the calculated weight reduction in the equation specified in 40 CFR 
1037.515 to calculate the trailer's CO2 emission rate and 
calculate an equivalent fuel consumption rate.
    (B) If a manufacturer's off-cycle technology reduces emissions and 
fuel consumption in a way that is proportional to measured rates as 
described in 40 CFR 1037.610(b)(1), multiply the trailer's 
CO2 fuel consumption rate by the appropriate improvement 
factor.
    (C) If a manufacturer's off-cycle technology does not yield 
emission and fuel consumption reductions that are proportional to 
measured rates, as described in 40 CFR 1037.610(b)(2), calculate an 
adjusted CO2 fuel consumption rate for trailers by 
subtracting the appropriate off-cycle credit.
    (vi) Carry-over Approval. Manufacturers may carry-over these 
credits into future model years as described below:
    (A) For model years before 2021, manufacturers may continue to use 
an approved improvement factor or credit for any appropriate engine or 
vehicle family in future model years through 2020.
    (B) For model years 2021 and later, manufacturers may not rely on 
an approval for model years before 2021. Manufacturers must separately 
request the agencies approval before applying an improvement factor or 
credit under this section for 2021 and later engines and vehicle, even 
if the agencies approve the improvement factor or credit for similar 
engine and vehicle models before model year 2021.
    (C) The following restrictions also apply to manufacturers seeking 
to continue to carryover the improvement factor (not the credit value) 
if--
    (1) The FEL is generated by GEM or 5-cycle testing;
    (2) The technology is not changed or paired with any other off-
cycle technology;
    (3) The improvement factor only applies to approved vehicle or 
engine families;
    (4) The agencies do not expect the technology to be incorporated 
into GEM at any point during the Phase 2 program; and

[[Page 74267]]

    (D) The documentation to carryover credits that would primarily 
justify the difference in fuel efficiency between real world and 
compliance protocols is the same for both Phase 1 and Phase 2 
compliance protocols. The agencies must approve the justification. If 
the agencies do not approve the justification, the manufacturer must 
recertify.


Sec.  535.8  Reporting and recordkeeping requirements.

    (a) General requirements. Manufacturers producing heavy-duty 
vehicles and engines applicable to fuel consumption standards in Sec.  
535.5, for each given model year, must submit the required information 
as specified in paragraphs (b) through (h) of this section.
    (1) The information required by this part must be submitted by the 
deadlines specified in this section and must be based upon all the 
information and data available to the manufacturer 30 days before 
submitting information.
    (2) Manufacturers must submit information electronically through 
the EPA database system as the single point of entry for all 
information required for this national program and both agencies will 
have access to the information. In special circumstances, data may not 
be able to be received electronically (i.e., during database system 
development work). The agencies will inform manufacturer of the 
alternatives can be used for submitting information. The format for the 
required information will be specified by EPA in coordination with 
NHTSA.
    (3) Manufacturers providing incomplete reports missing any of the 
required information or providing untimely reports are considered as 
not complying with standards (i.e., if good-faith estimates of U.S.-
directed production volumes for EPA certificates of conformity are not 
provided) and are liable to pay civil penalties in accordance with 49 
U.S.C. 32912.
    (4) Manufacturers certifying a vehicle or engine family using an 
FEL or FCL below the applicable fuel consumption standard as described 
in Sec.  535.5 may choose not to generate fuel consumption credits for 
that family. In which case, the manufacturer is not required to submit 
reporting or keep the associated records described in this part for 
that family.
    (5) Manufacturers must use good engineering judgment and provide 
comparable fuel consumption information to that of the information or 
data provided to EPA under 40 CFR 86.1865, 1036.250, 1036.730, 1036.825 
1037.250, 1037.730, and 1037.825.
    (6) Any information that must be sent directly to NHTSA. In 
instances in which EPA has not created an electronic pathway to receive 
the information, the information should be sent through an electronic 
portal identified by NHTSA or through the NHTSA CAFE database (i.e., 
information on fuel consumption credit transactions). If hardcopy 
documents must be sent, the information should be sent to the Associate 
Administrator of Enforcement at 1200 New Jersey Avenue, NVS-200, Office 
W45-306, SW., Washington, DC 20590.
    (b) Pre-model year reports. Manufacturers producing heavy-duty 
pickup trucks and vans must submit reports in advance of the model year 
providing early estimates demonstrating how their fleet(s) would comply 
with GHG emissions and fuel consumption standards. Note, the agencies 
understand that early model year reports contain estimates that may 
change over the course of a model year and that compliance information 
manufacturers submit prior to the beginning of a new model year may not 
represent the final compliance outcome. The agencies view the necessity 
for requiring early model reports as a manufacturer's good faith 
projection for demonstrating compliance with emission and fuel 
consumption standards.
    (1) Report deadlines. For model years 2013 and later, manufacturer 
of heavy-duty pickup trucks and vans complying with voluntary and 
mandatory standards must submit a pre-model year report for the given 
model year as early as the date of the manufacturer's annual 
certification preview meeting with EPA and NHTSA, or prior to 
submitting its first application for a certificate of conformity to EPA 
in accordance with 40 CFR 86.1819-14(d). For example, a manufacturer 
choosing to comply in model year 2014 could submit its pre-model year 
report during its precertification meeting which could occur before 
January 2, 2013, or could provide its pre-model year report any time 
prior to submitting its first application for certification for the 
given model year.
    (2) Contents. Each pre-model year report must be submitted 
including the following information for each model year.
    (i) A list of each unique subconfiguration in the manufacturer's 
fleet describing the make and model designations, attribute based-
values (i.e., GVWR, GCWR, Curb Weight and drive configurations) and 
standards;
    (ii) The emission and fuel consumption fleet average standard 
derived from the unique vehicle configurations;
    (iii) The estimated vehicle configuration, test group and fleet 
production volumes;
    (iv) The expected emissions and fuel consumption test group results 
and fleet average performance;
    (v) If complying with MY 2013 fuel consumption standards, a 
statement must be provided declaring that the manufacturer is 
voluntarily choosing to comply early with the EPA and NHTSA programs. 
The manufacturers must also acknowledge that once selected, the 
decision cannot be reversed and the manufacturer will continue to 
comply with the fuel consumption standards for subsequent model years 
for all the vehicles it manufacturers in each regulatory category for a 
given model year;
    (vi) If complying with MYs 2014, 2015 or 2016 fuel consumption 
standards, a statement must be provided declaring whether the 
manufacturer will use fixed or increasing standards in accordance with 
Sec.  535.5(a). The manufacturer must also acknowledge that once 
selected, the decision cannot be reversed and the manufacturer must 
continue to comply with the same alternative for subsequent model years 
for all the vehicles it manufacturers in each regulatory category for a 
given model year;
    (vii) If complying with MYs 2014 or 2015 fuel consumption 
standards, a statement must be provided declaring that the manufacturer 
is voluntarily choosing to comply with NHTSA's voluntary fuel 
consumption standards in accordance with Sec.  535.5(a)(4). The 
manufacturers must also acknowledge that once selected, the decision 
cannot be reversed and the manufacturer will continue to comply with 
the fuel consumption standards for subsequent model years for all the 
vehicles it manufacturers in each regulatory category for a given model 
year;
    (viii) The list of Class 2b and 3 incomplete vehicles (cab-complete 
or chassis complete vehicles) and the method used to certify these 
vehicles as complete pickups and vans identifying the most similar 
complete sister- or other complete vehicles used to derive the target 
standards and performance test results;
    (ix) The list of Class 4 and 5 incomplete and complete vehicles and 
the method use to certify these vehicles as complete pickups and vans 
identifying the most similar complete or sister vehicles used to derive 
the target standards and performance test results;
    (x) List of loose engines included in the heavy-duty pickup and van 
category

[[Page 74268]]

and the list of vehicles used to derive target standards and 
performance test results;
    (xi) Copy of any notices a vehicle manufacturer sends to the engine 
manufacturer to notify the engine manufacturers that their engines are 
subject to emissions and fuel consumption standards and that it intends 
to use their engines in excluded vehicles;
    (xii) A fuel consumption credit plan as specified Sec.  535.7(a) 
identifying the manufacturers estimated credit balances, planned credit 
flexibilities (i.e., credit balances, planned credit trading, 
innovative, advanced and early credits and etc.) and if needed a credit 
deficit plan demonstrating how it plans to resolve any credit deficits 
that might occur for a model year within a period of up to three model 
years after that deficit has occurred; and
    (xiii) The supplemental information specified in paragraph (h) of 
this section.

    Note to paragraph (b): NHTSA may also ask a manufacturer to 
provide additional information if necessary to verify compliance 
with the fuel consumption requirements of this section.

    (c) Applications for certificate of conformity. Manufacturers 
producing vocational vehicles, tractors and heavy-duty engines are 
required to submit applications for certificates of conformity to EPA 
in accordance with 40 CFR 1036.205 and 1037.205 in advance of 
introducing vehicles for commercial sale. Applications contain early 
model year information demonstrating how manufacturers plan to comply 
with GHG emissions. For model years 2013 and later, manufacturers of 
vocational vehicles, tractors and engine complying with NHTSA's 
voluntary and mandatory standards must submit applications for 
certificates of conformity in accordance through the EPA database 
including both GHG emissions and fuel consumption information for each 
given model year.
    (1) Submission deadlines. Applications are primarily submitted in 
advance of the given model year to EPA but cannot be submitted any 
later than December 31 of the given model year.
    (2) Contents. Each application for certificates of conformity 
submitted to EPA must include the following equivalent fuel 
consumption.
    (i) Equivalent fuel consumption values for emissions CO2 
FCLs values used to certify each engine family in accordance with 40 
CFR 1036.205(e). This provision applies only to manufacturers producing 
heavy-duty engines.
    (ii) Equivalent fuel consumption values for emission CO2 
data engines used to comply with emission standards in 40 CFR 1036.108. 
This provision applies only to manufacturers producing heavy-duty 
engines.
    (iii) Equivalent fuel consumption values for emissions 
CO2 FELs values used to certify each vehicle families or 
subfamilies in accordance with 40 CFR 1037.205(k). This provision 
applies only to manufacturers producing vocational vehicles and 
tractors.
    (iv) Report modeling results for ten configurations in terms of 
CO2 emissions and equivalent fuel consumption results in 
accordance with 40 CFR 1037.205(o). Include modeling inputs and 
detailed descriptions of how they were derived. This provision applies 
only to manufacturers producing vocational vehicles and tractors.
    (v) Credit plans including the fuel consumption credit plan 
described in Sec.  535.7(a).
    (3) Additional supplemental information. Manufacturers are required 
to submit additional information as specified in paragraph (h) of this 
section for the NHTSA program before or at the same time it submits its 
first application for a certificate of conformity to EPA. Under limited 
conditions, NHTSA may also ask a manufacturer to provide additional 
information directly to the Administrator if necessary to verify the 
fuel consumption requirements of this regulation.
    (d) End of the Year (EOY) and Final reports. Heavy-duty vehicle and 
engine manufacturers participating in the ABT program are required to 
submit EOY and final reports containing information for NHTSA as 
specified in paragraph (d)(2) of this section and in accordance with 40 
CFR 86.1865, 1036.730, and 1037.730. Only manufacturers without credit 
deficits may decide not to participate in the ABT or may waive the 
requirement to send an EOY report. The EOY and final reports are used 
to review a manufacturer's preliminary or final compliance information 
and to identify manufacturers that might have a credit deficit for the 
given model year. For model years 2013 and later, heavy-duty vehicle 
and engine manufacturers complying with NHTSA's voluntary and mandatory 
standards must submit EOY and final reports through the EPA database 
including both GHG emissions and fuel consumption information for each 
given model year.
    (1) Report deadlines. (i) For model year 2013 and later, heavy-duty 
vehicle and engine manufacturers complying with NHTSA voluntary and 
mandatory standards must submit EOY reports through the EPA database 
including both GHG emissions and fuel consumption information within 90 
days after the end of the given model year and no later than March 31 
of the next calendar year.
    (ii) For model year 2013 and later, heavy-duty vehicle and engine 
manufacturers complying with NHTSA voluntary and mandatory standards 
must submit final reports through the EPA database including both GHG 
emissions and fuel consumption information within 270 days after the 
end of the given model year and no later than September 30 of the next 
calendar year.
    (iii) A manufacturer may ask NHTSA and EPA to extend the deadline 
of a final report by up to 30 days. A manufacturer unable to provide, 
and requesting to omit an emissions rate or fuel consumption value from 
a final report must obtain approval from the agencies prior to the 
submission deadline of its final report.
    (iv) If a manufacturer expects differences in the information 
reported between the EOY and the final year report specified in 40 CFR 
1036.730 and 1037.730, it must provide the most up-to-date fuel 
consumption projections in its final report and identify the 
information as preliminary.
    (v) If the manufacturer cannot provide any of the required fuel 
consumption information, it must state the specific reason for the 
insufficiency and identify the additional testing needed or explain 
what analytical methods are believed by the manufacturer will be 
necessary to eliminate the insufficiency and certify that the results 
will be available for the final report.
    (2) Contents. Each EOY and final report must be submitted including 
the following fuel consumption information for each model year. EOY 
reports contain preliminary final estimates and final reports must 
include the manufacturer's final compliance information.
    (i) Engine and vehicle family designations and averaging sets.
    (ii) Engine and vehicle regulatory subcategory and fuel consumption 
standards including any alternative standards used.
    (iii) Engine and vehicle family FCLs and FELs in terms of fuel 
consumption.
    (iv) Production volumes for engines and vehicles.
    (v) A summary as specified in paragraph (g)(7) of this section 
describing the vocational vehicles and vocational tractors that were 
exempted as heavy-duty off-road vehicles. This applies to manufacturers 
participating

[[Page 74269]]

and not participating in the ABT program.
    (vi) A summary describing any advanced or innovative technology 
engines or vehicles including alternative fueled vehicles that were 
produced for the model year identifying the approaches used to 
determinate compliance and the production volumes.
    (vii) A list of each unique subconfiguration included in a 
manufacturer's fleet of heavy-duty pickup trucks and vans identifying 
the attribute based-values (GVWR, GCWR, Curb Weight, and drive 
configurations) and standards. This provision applies only to 
manufacturers producing heavy-duty pickup trucks and vans.
    (viii) The fuel consumption fleet average standard derived from the 
unique vehicle configurations. This provision applies only to 
manufacturers producing heavy-duty pickup trucks and vans.
    (ix) The subconfiguration and test group production volumes. This 
provision applies only to manufacturers producing heavy-duty pickup 
trucks and vans.
    (x) The fuel consumption test group results and fleet average 
performance. This provision applies only to manufacturers producing 
heavy-duty pickup trucks and vans.
    (xi) Manufacturers may correct errors in EOY and final reports as 
follows:
    (A) Manufacturers may correct any errors in their end-of-year 
report when preparing the final report, as long as manufacturers send 
us the final report by the time it is due.
    (B) If manufacturers or the agencies determine within 270 days 
after the end of the model year that errors mistakenly decreased he 
manufacturer's balance of fuel consumption credits, manufacturers may 
correct the errors and recalculate the balance of its fuel consumption 
credits. Manufacturers may not make any corrections for errors that are 
determined more than 270 days after the end of the model year. If 
manufacturers report a negative balance of fuel consumption credits, 
NHTSA may disallow corrections under this paragraph (d)(2)(xi)(B).
    (C) If manufacturers or the agencies determine any time that errors 
mistakenly increased its balance of fuel consumption credits, 
manufacturers must correct the errors and recalculate the balance of 
fuel consumption credits.
    (xii) Under limited conditions, NHTSA may also ask a manufacturer 
to provide additional information directly to the Administrator if 
necessary to verify the fuel consumption requirements of this 
regulation.
    (e) Amendments to applications for certification. At any time, a 
manufacturer modifies an application for certification in accordance 
with 40 CFR 1036.225 and 1037.225, it must submit GHG emissions changes 
with equivalent fuel consumption values for the information required in 
paragraphs (b) through (e) and (h) of this section.
    (f) Confidential information. Manufacturers must submit a request 
for confidentiality with each electronic submission specifying any part 
of the for information or data in a report that it believes should be 
withheld from public disclosure as trade secret or other confidential 
business information. Information submitted to EPA should follow EPA 
guidelines for treatment of confidentiality. Requests for confidential 
treatment for information submitted to NHTSA must be filed in 
accordance with the requirements of 49 CFR part 512, including 
submission of a request for confidential treatment and the information 
for which confidential treatment is requested as specified by part 512. 
For any information or data requested by the manufacturer to be 
withheld under 5 U.S.C. 552(b)(4) and 49 U.S.C. 32910(c), the 
manufacturer shall present arguments and provide evidence in its 
request for confidentiality demonstrating that--
    (1) The item is within the scope of 5 U.S.C. 552(b)(4) and 49 
U.S.C. 32910(c);
    (2) The disclosure of the information at issue would cause 
significant competitive damage;
    (3) The period during which the item must be withheld to avoid that 
damage; and
    (4) How earlier disclosure would result in that damage.
    (g) Additional required information. The following additional 
information is required to be submitted through the EPA database. NHTSA 
reserves the right to ask a manufacturer to provide additional 
information if necessary to verify the fuel consumption requirements of 
this regulation.
    (1) Small businesses. For model years 2013 through 2020, vehicles 
and engines produced by small business manufacturers meeting the 
criteria in 13 CFR 121.201 are exempted from the requirements of this 
part. Qualifying small business manufacturers must notify EPA and NHTSA 
Administrators before importing or introducing into U.S. commerce 
exempted vehicles or engines. This notification must include a 
description of the manufacturer's qualification as a small business 
under 13 CFR 121.201. Manufacturers must submit this notification to 
EPA, and EPA will provide the notification to NHTSA. The agencies may 
review a manufacturer's qualification as a small business manufacturer 
under 13 CFR 121.201.
    (2) Emergency vehicles. For model years 2021 and later, emergency 
vehicles produced by heavy-duty pickup truck and van manufacturers are 
exempted except those produced by manufacturers voluntarily complying 
with standards in Sec.  535.5(a). Manufacturers must notify the 
agencies in writing if using the provisions in Sec.  535.5(a) to 
produce exempted emergency vehicles in a given model year, either in 
the report specified in 40 CFR 86.1865 or in a separate submission.
    (3) Early introduction. The provision applies to manufacturers 
seeking to comply early with the NHTSA's fuel consumption program prior 
to model year 2014. The manufacturer must send the request to EPA 
before submitting its first application for a certificate of 
conformity.
    (4) NHTSA voluntary compliance model years. Manufacturers must 
submit a statement declaring whether the manufacturer chooses to comply 
voluntarily with NHTSA's fuel consumption standards for model years 
2014 through 2015. The manufacturers must acknowledge that once 
selected, the decision cannot be reversed and the manufacturer will 
continue to comply with the fuel consumption standards for subsequent 
model years. The manufacturer must send the statement to EPA before 
submitting its first application for a certificate of conformity.
    (5) Alternative engine standards. Manufacturers choosing to comply 
with the alternative engine standards must notify EPA and NHTSA of 
their choice and include in that notification a demonstration that it 
has exhausted all available credits and credit opportunities. The 
manufacturer must send the statement to EPA before submitting its EOY 
report.
    (6) Alternate phase-in. Manufacturers choosing to comply with the 
alternative engine phase-in must notify EPA and NHTSA of their choice. 
The manufacturer must send the statement to EPA before submitting its 
first application for a certificate of conformity.
    (7) Off-road exclusion (tractors and vocational vehicles only). (i) 
Tractors and vocational vehicles primarily designed to perform work in 
off-road environments such as forests, oil fields, and construction 
sites may be exempted without request from the requirements of this 
regulation as specified in 49 CFR 523.2 and Sec.  535.5(b). Within 90 
days after the end of each model year,

[[Page 74270]]

manufacturers must send EPA and NHTSA through the EPA database a report 
with the following information:
    (A) A description of each excluded vehicle configuration, including 
an explanation of why it qualifies for this exclusion.
    (B) The number of vehicles excluded for each vehicle configuration.
    (ii) A manufacturer having an off-road vehicle failing to meet the 
criteria under the agencies' off-road exclusions will be allowed to 
request an exclusion of such a vehicle from EPA and NHTSA. The approval 
will be granted through the certification process for the vehicle 
family and will be done in collaboration between EPA and NHTSA in 
accordance with the provisions in 40 CFR 1037.150, 1037.210, and 
1037.631.
    (8) Vocational tractors. Tractors intended to be used as vocational 
tractors may comply with vocational vehicle standards in Sec.  
535.5(b). Manufacturers classifying tractors as vocational tractors 
must provide a description of how they meet the qualifications in their 
applications for certificates of conformity as specified in 40 CFR 
1037.205.
    (9) Approval of alternate methods to determine drag coefficients 
(tractors only). Manufacturers seeking to use alternative methods to 
determine aerodynamic drag coefficients must provide a request and gain 
approval by EPA in accordance with 40 CFR 1037.525. The manufacturer 
must send the request to EPA before submitting its first application 
for a certificate of conformity.
    (10) Innovative and off-cycle technology credits. Manufacturers 
pursuing innovative and off-cycle technology credits must submit 
information to the agencies and may be subject to a public evaluation 
process in which the public would have opportunity for comment if the 
manufacturer is not using a test procedure in accordance with 40 CFR 
1037.610(c). Whether the approach involves on-road testing, modeling, 
or some other analytical approach, the manufacturer would be required 
to present a final methodology to EPA and NHTSA. EPA and NHTSA would 
approve the methodology and credits only if certain criteria were met. 
Baseline emissions and fuel consumption and control emissions and fuel 
consumption would need to be clearly demonstrated over a wide range of 
real world driving conditions and over a sufficient number of vehicles 
to address issues of uncertainty with the data. Data would need to be 
on a vehicle model-specific basis unless a manufacturer demonstrated 
model-specific data was not necessary. The agencies may publish a 
notice of availability in the Federal Register notifying the public of 
a manufacturer's proposed alternative off-cycle credit calculation 
methodology and provide opportunity for comment. Any notice will 
include details regarding the methodology, but not include any 
Confidential Business Information.
    (11) Credit trades. If a manufacturer trades fuel consumption 
credits, it must send EPA and NHTSA a fuel consumption credit plan as 
specified in Sec.  535.7(a) and provide the following additional 
information:
    (i) As the seller, the manufacturer must include the following 
information:
    (A) The corporate names of the buyer and any brokers.
    (B) A copy of any contracts related to the trade.
    (C) The averaging set corresponding to the engine families that 
generated fuel consumption credits for the trade, including the number 
of fuel consumption credits from each averaging set.
    (ii) As the buyer, the manufacturer or entity must include the 
following information in its report:
    (A) The corporate names of the seller and any brokers.
    (B) A copy of any contracts related to the trade.
    (C) How the manufacturer or entity intends to use the fuel 
consumption credits, including the number of fuel consumption credits 
it intends to apply for each averaging set.
    (D) A copy of the contract with signatures from both the buyer and 
the seller.
    (12) Production reports. Within 90 days after the end of the model 
year and no later than March 31st, manufacturers participating and not-
participating in the ABT program must send to EPA and NHTSA a report 
including the total U.S.-directed production volume of vehicles it 
produced in each vehicle and engine family during the model year (based 
on information available at the time of the report) as required by 40 
CFR 1036.250 and 1037.250. Trailer manufacturers must include a 
separate report including the total U.S.-directed production volume of 
excluded trailers as allowed by Sec.  535.3(e). Each manufacturer shall 
report by vehicle or engine identification number and by configuration 
and identify the subfamily identifier. Report uncertified vehicles sold 
to secondary vehicle manufacturers. Small business manufacturers may 
omit reporting. Identify any differences between volumes included for 
EPA but excluded for NHTSA.
    (13) Transition to engine-based model years. The following 
provisions apply for production and ABT reports during the transition 
to engine-based model year determinations for tractors and vocational 
vehicles in 2020 and 2021:
    (i) If a manufacturer installs model year 2020 or earlier engines 
in the manufacturer's vehicles in calendar year 2020, include all those 
Phase 1 vehicles in its production and ABT reports related to model 
year 2020 compliance, although the agencies may require the 
manufacturer to identify these separately from vehicles produced in 
calendar year 2019.
    (ii) If a manufacturer installs model year 2020 engines in its 
vehicles in calendar year 2021, submit production and ABT reports for 
those Phase 1 vehicles separate from the reports it submits for Phase 2 
vehicles with model year 2021 engines.
    (h) Public information. Based upon information submitted by 
manufacturers and EPA, NHTSA will publish fuel consumption standards 
and performance results.
    (i) Information received from EPA. NHTSA will receive information 
from EPA as specified in 40 CFR 1036.755 and 1037.755.
    (j) Recordkeeping. NHTSA has the same recordkeeping requirements as 
the EPA, specified in 40 CFR 86.1865-12(k), 1036.250, 1036.735, 
1036.825, 1037.250, 1037.735, and 1037.825. The agencies each reserve 
the right to request information contained in reports separately.
    (1) Manufacturers must organize and maintain records for NHTSA as 
described in this section. NHTSA in conjunction or separately from EPA 
may review a manufacturers records at any time.
    (2) Keep the records required by this section for at least eight 
years after the due date for the end-of-year report. Manufacturers may 
not use fuel consumption credits for any engines if it does not keep 
all the records required under this section. Manufacturers must 
therefore keep these records to continue to bank valid credits. Store 
these records in any electronic format and on any media, as long as the 
manufacturer can promptly send the agencies organized records in 
English if the agencies ask for them. Manufacturers must keep these 
records readily available. NHTSA may review them at any time.
    (3) Keep a copy of the reports required in Sec.  535.8 and 40 CFR 
1036.725,1036.730, 1037.725 and 1037.730.
    (4) Keep records of the vehicles and engine identification number 
(usually the serial number) for each vehicle and

[[Page 74271]]

engine produced that generates or uses fuel consumption credits under 
the ABT program. Manufacturers may identify these numbers as a range. 
If manufacturers change the FEL after the start of production, identify 
the date started using each FEL/FCL and the range of vehicles or engine 
identification numbers associated with each FEL/FCL. Manufacturers must 
also identify the purchaser and destination for each vehicle and engine 
produced to the extent this information is available.
    (5) The agencies may require manufacturers to keep additional 
records or to send relevant information not required by this section in 
accordance with each agency's authority.
    (6) If collected separately and NHTSA finds that information is 
provided fraudulent or grossly negligent or otherwise provided in bad 
faith, the manufacturer may be liable to civil penalties in accordance 
with each agency's authority.


Sec.  535.9  Enforcement approach.

    (a) Compliance. (1) Each year NHTSA will assess compliance with 
fuel consumption standards as specified in Sec.  535.10.
    (i) NHTSA may conduct audits or verification testing prior to first 
sale throughout a given model year or after the model year in order to 
validate data received from manufacturers and will discuss any 
potential issues with EPA and the manufacturer. Audits may periodically 
be performed to confirm manufacturers credit balances or other credit 
transactions.
    (ii) NHTSA may also conduct field inspections either at 
manufacturing plants or at new vehicle dealerships to validate data 
received from manufacturers. Field inspections will be carried out in 
order to validate the condition of vehicles, engines or technology 
prior to first commercial sale to verify each component's certified 
configuration as initially built. NHTSA reserves the right to conduct 
inspections at other locations but will target only those components 
for which a violation would apply to OEMs and not the fleets or vehicle 
owners. Compliance inspections could be carried out through a number of 
approaches including during safety inspections or during compliance 
safety testing.
    (iii) NHTSA will conduct audits and inspections in the same manner 
and, when possible, in conjunction with EPA. NHTSA will also attempt to 
coordinate inspections with EPA and share results.
    (iv) Documents collected under NHTSA safety authority may be used 
to support fuel efficiency audits and inspections.
    (2) At the end of each model year NHTSA will confirm a 
manufacturer's fleet or family performance values against the 
applicable standards and, if a manufacturer uses a credit flexibility, 
the amount of credits in each averaging set. The averaging set balance 
is based upon the engines or vehicles performance above or below the 
applicable regulatory subcategory standards in each respective 
averaging set and any credits that are traded into or out of an 
averaging set during the model year.
    (i) If the balance is positive, the manufacturer is designated as 
having a credit surplus.
    (ii) If the balance is negative, the manufacturer is designated as 
having a credit deficit.
    (iii) NHTSA will provide notification to each manufacturer 
confirming its credit balance(s) after the end of each model year 
directly or through EPA.
    (3) Manufacturer are required to confirm the negative balance and 
submit a fuel consumption credit plan as specified in Sec.  535.7(a) 
along with supporting documentation indicating how it will allocate 
existing credits or earn (providing information on future vehicles, 
engines or technologies), and/or acquire credits, or else be liable for 
a civil penalty as determined in paragraph (b) of this section. The 
manufacturer must submit the information within 60 days of receiving 
agency notification.
    (4) Credit shortfall within an averaging set may be carried forward 
only three years, and if not offset by earned or traded credits, the 
manufacturer may be liable for a civil penalty as described in 
paragraph (b) of this section.
    (5) Credit allocation plans received from a manufacturer will be 
reviewed and approved by NHTSA. NHTSA will approve a credit allocation 
plan unless it determines that the proposed credits are unavailable or 
that it is unlikely that the plan will result in the manufacturer 
earning or acquiring sufficient credits to offset the subject credit 
shortfall. In the case where a manufacturer submits a plan to acquire 
future model year credits earned by another manufacturer, NHTSA will 
require a signed agreement by both manufacturers to initiate a review 
of the plan. If a plan is approved, NHTSA will revise the respective 
manufacturer's credit account accordingly by identifying which existing 
or traded credits are being used to address the credit shortfall, or by 
identifying the manufacturer's plan to earn future credits for 
addressing the respective credit shortfall. If a plan is rejected, 
NHTSA will notify the respective manufacturer and request a revised 
plan. The manufacturer must submit a revised plan within 14 days of 
receiving agency notification. The agency will provide a manufacturer 
one opportunity to submit a revised credit allocation plan before it 
initiates civil penalty proceedings.
    (6) For purposes of this regulation, NHTSA will treat the use of 
future credits for compliance, as through a credit allocation plan, as 
a deferral of civil penalties for non-compliance with an applicable 
fuel consumption standard.
    (7) If NHTSA receives and approves a manufacturer's credit 
allocation plan to earn future credits within the following three model 
years in order to comply with regulatory obligations, NHTSA will defer 
levying civil penalties for non-compliance until the date(s) when the 
manufacturer's approved plan indicates that credits will be earned or 
acquired to achieve compliance, and upon receiving confirmed 
CO2 emissions and fuel consumption data from EPA. If the 
manufacturer fails to acquire or earn sufficient credits by the plan 
dates, NHTSA will initiate civil penalty proceedings.
    (8) In the event that NHTSA fails to receive or is unable to 
approve a plan for a non-compliant manufacturer due to insufficiency or 
untimeliness, NHTSA may initiate civil penalty proceedings.
    (9) In the event that a manufacturer fails to report accurate fuel 
consumption data for vehicles or engines covered under this rule, 
noncompliance will be assumed until corrected by submission of the 
required data, and NHTSA may initiate civil penalty proceedings.
    (10) If EPA suspends or revoke a certificate of conformity as 
specified in 40 CFR 1036.255 or 1037.255, and a manufacturer is unable 
to take a corrective action allowed by EPA, noncompliance will be 
assumed, and NHTSA may initiate civil penalty proceedings or revoke 
fuel consumption credits.
    (b) Civil penalties--(1) Generally. NHTSA may assess a civil 
penalty for any violation of this part under 49 U.S.C. 32902(k). This 
section states the procedures for assessing civil penalties for 
violations of Sec.  535.3(h). The provisions of 5 U.S.C. 554, 556, and 
557 do not apply to any proceedings conducted pursuant to this section.
    (2) Initial determination of noncompliance. An action for civil 
penalties is commenced by the execution of a Notice of Violation. A 
determination by NHTSA's Office of

[[Page 74272]]

Enforcement of noncompliance with applicable fuel consumption standards 
utilizing the certified and reported CO2 emissions and fuel 
consumption data provided by the Environmental Protection Agency as 
described in this part, and after considering all the flexibilities 
available under Sec.  535.7, underlies a Notice of Violation. If NHTSA 
Enforcement determines that a manufacturer's averaging set of vehicles 
or engines fails to comply with the applicable fuel consumption 
standard(s) by generating a credit shortfall, the incomplete vehicle, 
complete vehicle or engine manufacturer, as relevant, shall be subject 
to a civil penalty.
    (3) Numbers of violations and maximum civil penalties. Any 
violation shall constitute a separate violation with respect to each 
vehicle or engine within the applicable regulatory averaging set. The 
maximum civil penalty is not more than $37,500.00 per vehicle or 
engine. The maximum civil penalty under this section for a related 
series of violations shall be determined by multiplying $37,500.00 
times the vehicle or engine production volume for the model year in 
question within the regulatory averaging set. NHTSA may adjust this 
civil penalty amount to account for inflation.
    (4) Factors for determining penalty amount. In determining the 
amount of any civil penalty proposed to be assessed or assessed under 
this section, NHTSA shall take into account the gravity of the 
violation, the size of the violator's business, the violator's history 
of compliance with applicable fuel consumption standards, the actual 
fuel consumption performance related to the applicable standards, the 
estimated cost to comply with the regulation and applicable standards, 
the quantity of vehicles or engines not complying, and the effect of 
the penalty on the violator's ability to continue in business. The 
``estimated cost to comply with the regulation and applicable 
standards,'' will be used to ensure that penalties for non-compliance 
will not be less than the cost of compliance.
    (5) NHTSA enforcement report of determination of non-compliance. 
(i) If NHTSA Enforcement determines that a violation has occurred, 
NHTSA Enforcement may prepare a report and send the report to the NHTSA 
Chief Counsel.
    (ii) The NHTSA Chief Counsel will review the report prepared by 
NHTSA Enforcement to determine if there is sufficient information to 
establish a likely violation.
    (iii) If the Chief Counsel determines that a violation has likely 
occurred, the Chief Counsel may issue a Notice of Violation to the 
party.
    (iv) If the Chief Counsel issues a Notice of Violation, he or she 
will prepare a case file with recommended actions. A record of any 
prior violations by the same party shall be forwarded with the case 
file.
    (6) Notice of violation. (i) The Notice of Violation will contain 
the following information:
    (A) The name and address of the party;
    (B) The alleged violation(s) and the applicable fuel consumption 
standard(s) violated;
    (C) The amount of the proposed penalty and basis for that amount;
    (D) The place to which, and the manner in which, payment is to be 
made;
    (E) A statement that the party may decline the Notice of Violation 
and that if the Notice of Violation is declined within 30 days of the 
date shown on the Notice of Violation, the party has the right to a 
hearing, if requested within 30 days of the date shown on the Notice of 
Violation, prior to a final assessment of a penalty by a Hearing 
Officer; and
    (F) A statement that failure to either pay the proposed penalty or 
to decline the Notice of Violation and request a hearing within 30 days 
of the date shown on the Notice of Violation will result in a finding 
of violation by default and that NHTSA will proceed with the civil 
penalty in the amount proposed on the Notice of Violation without 
processing the violation under the hearing procedures set forth in this 
subpart.
    (ii) The Notice of Violation may be delivered to the party by--
    (A) Mailing to the party (certified mail is not required);
    (B) Use of an overnight or express courier service; or
    (C) Facsimile transmission or electronic mail (with or without 
attachments) to the party or an employee of the party.
    (iii) At any time after the Notice of Violation is issued, NHTSA 
and the party may agree to reach a compromise on the payment amount.
    (iv) Once a penalty amount is paid in full, a finding of ``resolved 
with payment'' will be entered into the case file.
    (v) If the party agrees to pay the proposed penalty, but has not 
made payment within 30 days of the date shown on the Notice of 
Violation, NHTSA will enter a finding of violation by default in the 
matter and NHTSA will proceed with the civil penalty in the amount 
proposed on the Notice of Violation without processing the violation 
under the hearing procedures set forth in this subpart.
    (vi) If within 30 days of the date shown on the Notice of Violation 
a party fails to pay the proposed penalty on the Notice of Violation, 
and fails to request a hearing, then NHTSA will enter a finding of 
violation by default in the case file, and will assess the civil 
penalty in the amount set forth on the Notice of Violation without 
processing the violation under the hearing procedures set forth in this 
subpart.
    (vii) NHTSA's order assessing the civil penalty following a party's 
default is a final agency action.
    (7) Hearing Officer. (i) If a party timely requests a hearing after 
receiving a Notice of Violation, a Hearing Officer shall hear the case.
    (ii) The Hearing Officer will be appointed by the NHTSA 
Administrator, and is solely responsible for the case referred to him 
or her. The Hearing Officer shall have no other responsibility, direct 
or supervisory, for the investigation of cases referred for the 
assessment of civil penalties. The Hearing Officer shall have no duties 
related to the light-duty fuel economy or medium- and heavy-duty fuel 
efficiency programs.
    (iii) The Hearing Officer decides each case on the basis of the 
information before him or her.
    (8) Initiation of action before the Hearing Officer. (i) After the 
Hearing Officer receives the case file from the Chief Counsel, the 
Hearing Officer notifies the party in writing of--
    (A) The date, time, and location of the hearing and whether the 
hearing will be conducted telephonically or at the DOT Headquarters 
building in Washington, DC;
    (B) The right to be represented at all stages of the proceeding by 
counsel as set forth in paragraph (b)(9) of this section; and
    (C) The right to a free copy of all written evidence in the case 
file.
    (ii) On the request of a party, or at the Hearing Officer's 
direction, multiple proceedings may be consolidated if at any time it 
appears that such consolidation is necessary or desirable.
    (9) Counsel. A party has the right to be represented at all stages 
of the proceeding by counsel. A party electing to be represented by 
counsel must notify the Hearing Officer of this election in writing, 
after which point the Hearing Officer will direct all further 
communications to that counsel. A party represented by counsel bears 
all of its own attorneys' fees and costs.
    (10) Hearing location and costs. (i) Unless the party requests a 
hearing at which the party appears before the

[[Page 74273]]

Hearing Officer in Washington, DC, the hearing may be held 
telephonically. In Washington, DC, the hearing is held at the 
headquarters of the U.S. Department of Transportation.
    (ii) The Hearing Officer may transfer a case to another Hearing 
Officer at a party's request or at the Hearing Officer's direction.
    (iii) A party is responsible for all fees and costs (including 
attorneys' fees and costs, and costs that may be associated with travel 
or accommodations) associated with attending a hearing.
    (11) Hearing procedures. (i) There is no right to discovery in any 
proceedings conducted pursuant to this subpart.
    (ii) The material in the case file pertinent to the issues to be 
determined by the Hearing Officer is presented by the Chief Counsel or 
his or her designee.
    (iii) The Chief Counsel may supplement the case file with 
information prior to the hearing. A copy of such information will be 
provided to the party no later than three business days before the 
hearing.
    (iv) At the close of the Chief Counsel's presentation of evidence, 
the party has the right to examine respond to and rebut material in the 
case file and other information presented by the Chief Counsel. In the 
case of witness testimony, both parties have the right of cross-
examination.
    (v) In receiving evidence, the Hearing Officer is not bound by 
strict rules of evidence. In evaluating the evidence presented, the 
Hearing Officer must give due consideration to the reliability and 
relevance of each item of evidence.
    (vi) At the close of the party's presentation of evidence, the 
Hearing Officer may allow the introduction of rebuttal evidence that 
may be presented by the Chief Counsel.
    (vii) The Hearing Officer may allow the party to respond to any 
rebuttal evidence submitted.
    (viii) After the evidence in the case has been presented, the Chief 
Counsel and the party may present arguments on the issues in the case. 
The party may also request an opportunity to submit a written statement 
for consideration by the Hearing Officer and for further review. If 
granted, the Hearing Officer shall allow a reasonable time for 
submission of the statement and shall specify the date by which it must 
be received. If the statement is not received within the time 
prescribed, or within the limits of any extension of time granted by 
the Hearing Officer, it need not be considered by the Hearing Officer.
    (ix) A verbatim transcript of the hearing will not normally be 
prepared. A party may, solely at its own expense, cause a verbatim 
transcript to be made. If a verbatim transcript is made, the party 
shall submit two copies to the Hearing Officer not later than 15 days 
after the hearing. The Hearing Officer shall include such transcript in 
the record.
    (12) Determination of violations and assessment of civil penalties. 
(i) Not later than 30 days following the close of the hearing, the 
Hearing Officer shall issue a written decision on the Notice of 
Violation, based on the hearing record. This may be extended by the 
Hearing officer if the submissions by the Chief Counsel or the party 
are voluminous. The decision shall address each alleged violation, and 
may do so collectively. For each alleged violation, the decision shall 
find a violation or no violation and provide a basis for the finding. 
The decision shall set forth the basis for the Hearing Officer's 
assessment of a civil penalty, or decision not to assess a civil 
penalty. In determining the amount of the civil penalty, the gravity of 
the violation, the size of the violator's business, the violator's 
history of compliance with applicable fuel consumption standards, the 
actual fuel consumption performance related to the applicable standard, 
the estimated cost to comply with the regulation and applicable 
standard, the quantity of vehicles or engines not complying, and the 
effect of the penalty on the violator's ability to continue in 
business. The assessment of a civil penalty by the Hearing Officer 
shall be set forth in an accompanying final order. The Hearing 
Officer's written final order is a final agency action.
    (ii) If the Hearing Officer assesses civil penalties in excess of 
$1,000,000, the Hearing Officer's decision shall contain a statement 
advising the party of the right to an administrative appeal to the 
Administrator within a specified period of time. The party is advised 
that failure to submit an appeal within the prescribed time will bar 
its consideration and that failure to appeal on the basis of a 
particular issue will constitute a waiver of that issue in its appeal 
before the Administrator.
    (iii) The filing of a timely and complete appeal to the 
Administrator of a Hearing Officer's order assessing a civil penalty 
shall suspend the operation of the Hearing Officer's penalty, which 
shall no longer be a final agency action.
    (iv) There shall be no administrative appeals of civil penalties 
assessed by a Hearing Officer of less than $1,000,000.
    (13) Appeals of civil penalties in excess of $1,000,000. (i) A 
party may appeal the Hearing Officer's order assessing civil penalties 
over $1,000,000 to the Administrator within 21 days of the date of the 
issuance of the Hearing Officer's order.
    (ii) The Administrator will review the decision of the Hearing 
Officer de novo, and may affirm the decision of the hearing officer and 
assess a civil penalty, or
    (iii) The Administrator may--
    (A) Modify a civil penalty;
    (B) Rescind the Notice of Violation; or
    (C) Remand the case back to the Hearing Officer for new or 
additional proceedings.
    (iv) In the absence of a remand, the decision of the Administrator 
in an appeal is a final agency action.
    (14) Collection of assessed or compromised civil penalties. (i) 
Payment of a civil penalty, whether assessed or compromised, shall be 
made by check, postal money order, or electronic transfer of funds, as 
provided in instructions by the agency. A payment of civil penalties 
shall not be considered a request for a hearing.
    (ii) The party must remit payment of any assessed civil penalty to 
NHTSA within 30 days after receipt of the Hearing Officer's order 
assessing civil penalties, or, in the case of an appeal to the 
Administrator, within 30 days after receipt of the Administrator's 
decision on the appeal.
    (iii) The party must remit payment of any compromised civil penalty 
to NHTSA on the date and under such terms and conditions as agreed to 
by the party and NHTSA. Failure to pay may result in NHTSA entering a 
finding of violation by default and assessing a civil penalty in the 
amount proposed in the Notice of Violation without processing the 
violation under the hearing procedures set forth in this part.
    (c) Changes in corporate ownership and control. Manufacturers must 
inform NHTSA of corporate relationship changes to ensure that credit 
accounts are identified correctly and credits are assigned and 
allocated properly.
    (1) In general, if two manufacturers merge in any way, they must 
inform NHTSA how they plan to merge their credit accounts. NHTSA will 
subsequently assess corporate fuel consumption and compliance status of 
the merged fleet instead of the original separate fleets.
    (2) If a manufacturer divides or divests itself of a portion of its 
automobile manufacturing business, it must inform NHTSA how it plans to 
divide the manufacturer's credit holdings into two or more accounts. 
NHTSA will subsequently distribute holdings as directed by the 
manufacturer, subject to provision for

[[Page 74274]]

reasonably anticipated compliance obligations.
    (3) If a manufacturer is a successor to another manufacturer's 
business, it must inform NHTSA how it plans to allocate credits and 
resolve liabilities per 49 CFR part 534.


Sec.  535.10  How do manufacturers comply with fuel consumption 
standards?

    (a) Pre-certification process. (1) Regulated manufacturers 
determine eligibility to use exemptions or exclusions in accordance 
with Sec.  535.3.
    (2) Manufacturers may seek preliminary approvals as specified in 40 
CFR 1036.210 and 40 CFR 1037.210 from EPA and NHTSA, if needed. 
Manufacturers may request to schedule pre-certification meetings with 
EPA and NHTSA prior to submitting approval requests for certificates of 
conformity to address any joint compliance issues and gain informal 
feedback from the agencies.
    (3) The requirements and prohibitions required by EPA in special 
circumstances in accordance with 40 CFR 1037.601 and 40 CFR part 1068 
apply to manufacturers for the purpose of complying with fuel 
consumption standards. Manufacturers should use good judgment when 
determining how EPA requirements apply in complying with the NHTSA 
program. Manufacturers may contact NHTSA and EPA for clarification 
about how these requirements apply to them.
    (4) In circumstances in which EPA provides multiple compliance 
approaches manufacturers must choose the same compliance path to comply 
with NHTSA's fuel consumption standards that they choose to comply with 
EPA's greenhouse gas emission standards.
    (5) Manufacturers may not introduce new vehicles into commerce 
without a certificate of conformity from EPA. Manufacturers must attest 
to several compliance standards in order to obtain a certificate of 
conformity. This includes stating comparable fuel consumption results 
for all required CO2 emissions rates. Manufacturers not 
completing these steps do not comply with the NHTSA fuel consumption 
standards.
    (6) Manufacturers apply the fuel consumption standards specified in 
Sec.  535.5 to vehicles, engines and components that represent 
production units and components for vehicle and engine families, sub-
families and configurations consistent with the EPA specifications in 
40 CFR 86.1819, 1036.230, and 1037.230.
    (7) Only certain vehicles and engines are allowed to comply 
differently between the NHTSA and EPA programs as detailed in this 
section. These vehicles and engines must be identified by manufacturers 
in the ABT and production reports required in Sec.  535.8.
    (b) Model year compliance. Manufacturers are required to conduct 
testing to demonstrate compliance with CO2 exhaust emissions 
standards in accordance with EPA's provisions in 40 CFR part 600, 
subpart B, 40 CFR 1036, subpart F, 40 CFR part 1037, subpart R, and 40 
CFR part 1066. Manufacturers determine equivalent fuel consumption 
performance values for CO2 results as specified in Sec.  
535.6 and demonstrate compliance by comparing equivalent results to the 
applicable fuel consumption standards in Sec.  535.5.
    (c) End-of-the-year process. Manufacturers comply with fuel 
consumption standards after the end of each model year, if--
    (1) For heavy-duty pickup trucks and vans, the manufacturer's fleet 
average performance, as determined in Sec.  535.6, is less than the 
fleet average standard; or
    (2) For truck tractors, vocational vehicles, engines and box 
trailers the manufacturer's fuel consumption performance for each 
vehicle or engine family (or sub-family), as determined in Sec.  535.6, 
is lower than the applicable regulatory subcategory standards in Sec.  
535.5.
    (3) For non-box and non-aero trailers, a manufacturer is considered 
in compliance with fuel consumption standards if all trailers meet the 
specified standards in Sec.  535.5(e)(1)(i).
    (4) NHTSA will use the EPA final verified values as specified in 40 
CFR 86.1819, 40 CFR 1036.755, and 1037.755 for making final 
determinations on whether vehicles and engines comply with fuel 
consumption standards.
    (5) A manufacturer fails to comply with fuel consumption standards 
if its final reports are not provided in accordance with Sec.  535.8 
and 40 CFR 86.1865, 1036.730, and 1037.730. Manufacturers not providing 
complete or accurate final reports or any plans by the required 
deadlines do not comply with fuel consumption standards. A manufacturer 
that is unable to provide any emissions results along with comparable 
fuel consumption values must obtain permission for EPA to exclude the 
results prior to the deadline for submitting final reports.
    (6) A manufacturer that would otherwise fail to directly comply 
with fuel consumption standards as described in paragraphs (c)(1) 
through (3) of this section may use one or more of the credit 
flexibilities provided under the NHTSA averaging, banking and trading 
program, as specified in Sec.  535.7, but must offset all credit 
deficits in its averaging sets to achieve compliance.
    (7) A manufacturer failing to comply with the provisions specified 
in this part may be liable to pay civil penalties in accordance with 
Sec.  535.9.
    (8) A manufacturer may also be liable to pay civil penalties if 
found by EPA or NHTSA to have provided false information as identified 
through NHTSA or EPA enforcement audits or new vehicle verification 
testing as specified in Sec.  535.9 and 40 CFR parts 86, 1036, and 
1037.

PART 538--MANUFACTURING INCENTIVES FOR ALTERNATIVE FUEL VEHICLES

0
382. Revise the authority citation for part 538 to read as follows:

    Authority:  49 U.S.C. 32901, 32905, and 32906; delegation of 
authority at 49 CFR 1.95.


0
383. Revise Sec.  538.5 to read as follows:


Sec.  538.5  Minimum driving range.

    (a) The minimum driving range that a passenger automobile must have 
in order to be treated as a dual fueled automobile pursuant to 49 
U.S.C. 32901(c) is 200 miles when operating on its nominal useable fuel 
tank capacity of the alternative fuel, except when the alternative fuel 
is electricity or compressed natural gas. Beginning model year 2016, a 
natural gas passenger automobile must have a minimum driving range of 
150 miles when operating on its nominal useable fuel tank capacity of 
the alternative fuel to be treated as a dual fueled automobile, 
pursuant to 49 U.S.C. 32901(c)(2).
    (b) The minimum driving range that a passenger automobile using 
electricity as an alternative fuel must have in order to be treated as 
a dual fueled automobile pursuant to 49 U.S.C. 32901(c) is 7.5 miles on 
its nominal storage capacity of electricity when operated on the EPA 
urban test cycle and 10.2 miles on its nominal storage capacity of 
electricity when operated on the EPA highway test cycle.

    Dated: August 16, 2016.
Anthony Foxx,
Secretary,Department of Transportation.
    Dated: August 16, 2016.
Gina McCarthy,
Administrator, Environmental Protection Agency.
[FR Doc. 2016-21203 Filed 10-24-16; 8:45 am]
 BILLING CODE 6560-50-P