[Federal Register Volume 74, Number 98 (Friday, May 22, 2009)]
[Notices]
[Pages 24007-24012]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-12009]
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ENVIRONMENTAL PROTECTION AGENCY
DEPARTMENT OF TRANSPORTATION
[FRL-8909-3]
RIN 2060-ZA15
Notice of Upcoming Joint Rulemaking To Establish Vehicle GHG
Emissions and CAFE Standards
AGENCIES: Environmental Protection Agency (EPA) and Department of
Transportation (DOT).
ACTION: Notice of Intent to conduct a joint rulemaking.
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SUMMARY: There is a critically important need for our country to
address global climate change and to reduce oil consumption. In this
context, EPA and DOT currently intend to work in coordination to
propose standards for control of emissions of greenhouse gases and for
fuel economy, respectively. If proposed and finalized, these standards
would apply to passenger cars, light-duty trucks, and medium-duty
passenger vehicles (light-duty vehicles) built in model years 2012
through 2016. Together, these vehicle categories, which include
passenger cars, sport utility vehicles, minivans, and pickup trucks,
are responsible for almost 60 percent of all U.S. transportation-
related greenhouse gas emissions. If ultimately adopted, these
standards would represent a harmonized and consistent national policy
pursuant to the separate statutory frameworks under which EPA and DOT
operate. The approach addressed in this Notice, if ultimately adopted,
is intended to allow manufacturers to build a single light-duty
national fleet that would satisfy all requirements under both programs
and would provide significant reductions in both greenhouse gas
emissions and oil consumption.
FOR FURTHER INFORMATION CONTACT: EPA: Christopher Lieske, Office of
Transportation and Air Quality, Assessment and Standards Division,
Environmental Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI
48105; telephone number: 734-214-4584; fax number: 734-214-4816; e-mail
address: [email protected], or Assessment and Standards
Division Hotline; telephone number (734) 214-
[[Page 24008]]
4636; e-mail address: [email protected]. DOT/NHTSA: Julie Abraham, Office
of Rulemaking, National Highway Traffic Safety Administration, 1200 New
Jersey Avenue, SE., Washington, DC 20590. Telephone: (202) 366-1455.
SUPPLEMENTARY INFORMATION:
I. Introduction
This joint Notice announces plans by the Environmental Protection
Agency (EPA) and the National Highway Traffic Safety Administration
(NHTSA), on behalf of the Department of Transportation, to propose a
strong and coordinated Federal greenhouse gas and fuel economy program
for passenger cars, light-duty trucks, and medium-duty passenger
vehicles (hereafter light-duty vehicles), referred to as the National
Program.\1\ Both agencies seek to propose a coordinated program that
can achieve important reductions of greenhouse gas (GHG) emissions and
improvements in fuel economy from the light-duty vehicle part of the
transportation sector, based on technology that will be commercially
available and that can be incorporated at a reasonable cost. The
agencies intend to propose a program that will also provide regulatory
certainty for the automobile industry, while recognizing the serious
current economic situation faced by this industry and many members of
the public.
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\1\ NHTSA is delegated responsibility for implementing the
Energy Policy and Conservation Act (EPCA) fuel economy requirements
assigned to the Secretary of Transportation. 49 CFR 1.50,
501.2(a)(8).
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In the near future, EPA and NHTSA intend to initiate a joint
rulemaking, with EPA proposing GHG emissions standards under the Clean
Air Act (CAA), and NHTSA proposing Corporate Average Fuel Economy
(CAFE) standards under EPCA, as amended by the Energy Independence and
Security Act of 2007 (EISA). It is intended that this joint rulemaking
proposal will reflect a carefully coordinated and harmonized approach
to implementing these two statutes and will be in accordance with all
substantive and procedural requirements imposed by law.
Since the 1970s, NHTSA has promulgated CAFE standards for light-
duty vehicles to address our country's need to reduce oil consumption.
In 2008 NHTSA proposed CAFE standards for model years (MY) 2011 through
2015. However, responding to a Presidential Memorandum of January 26,
2009, NHTSA issued CAFE standards limited to MY 2011,\2\ and has been
comprehensively reviewing how it sets CAFE standards in the context of
preparing to propose CAFE standards for MY 2012 and later model years.
At the same time, EPA has been working on appropriate responses that
are consistent with the decision of the Supreme Court in Massachusetts
v. EPA \3\ and EPA's recent proposal to find that emissions of GHGs
from new motor vehicles and motor vehicle engines cause or contribute
to air pollution that may reasonably be anticipated to endanger public
health and welfare.\4\ In addition, in 2005 California adopted GHG
emissions standards for new light-duty vehicles. Thirteen States and
the District of Columbia to date, comprising approximately 40 percent
of the light-duty vehicle market, have adopted California's GHG
emissions standards. In 2008, EPA denied a request by California for a
waiver of preemption under the CAA for its GHG emissions standards.
However, consistent with another Presidential Memorandum of January 26,
2009, EPA is currently reconsidering the prior denial of California's
request.\5\ California and the States that have adopted California's
standards are planning to enforce these standards if EPA grants
California's request for a waiver of preemption.
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\2\ 74 FR 14196; March 30, 2009.
\3\ 549 U.S. 497 (2007).
\4\ 74 FR 18886; April 24, 2009.
\5\ 74 FR 7040; February 12, 2009.
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In sum, one agency is responsible for a standard that focuses on
emissions of GHG and the other for a standard that focuses on improving
fuel economy, and there are both Federal and State administrative
agencies working on standards to address similar issues. Consistent,
harmonized, and streamlined requirements hold out the promise of
delivering environmental and energy benefits, cost savings, and
administrative efficiencies that might not be available under a less
coordinated approach. The National Program the agencies intend to
propose would seek to deliver on that promise.
Key elements of a harmonized and coordinated National Program the
agencies intend to propose are the level and form of the standard, the
available compliance mechanisms, and general implementation elements.
These elements are outlined in the following sections. The agencies
will continue to evaluate all of the issues relevant to developing a
proposal, and will provide their evaluations for review and public
comment with the upcoming NPRM. This will include analyses on a variety
of relevant issues, such as the costs and benefits of the proposal
(both quantified and unquantified), as well as the effects the proposal
would have on the economy, manufacturers, and consumers. The notice of
proposed rulemaking the agencies intend to issue will discuss both the
analyses that will have been done for the proposal as well as any plans
for conducting additional analyses.
It is also important to note that GHG standards expected to be
issued under section 202(a) of the CAA would become final only if EPA
makes a final finding consistent with its recent proposal to find that
emissions of greenhouse gases from new motor vehicles and motor vehicle
engines cause or contribute to air pollution that may reasonably be
anticipated to endanger public health and welfare.
The agencies also anticipate that the kind of harmonized and
consistent national policy described in this Notice should be
considered in developing standards for model years after 2016, in a
future rulemaking.
II. Key Elements of the National Program
A. Level of the Standards
EPA and NHTSA intend to propose two separate sets of standards,
each under their respective statutory authorities. EPA expects to
propose a national CO2 vehicle emissions standard under
section 202(a) of the Clean Air Act. EPA currently is considering
proposing standards that would, if made final, achieve on average 250
grams/mile of CO2 in model year 2016. The standards for
earlier years would begin with the 2012 model year, with a generally
linear phase-in from MY 2012 through to model year 2016. NHTSA expects
to propose appropriate related CAFE standards.
In developing the proposals under consideration, EPA and NHTSA have
preliminarily evaluated the kinds of technologies that could be
utilized by the automobile industry, as well as the associated costs
for the industry and fuel savings for the consumer, the magnitude of
the GHG and energy consumption reductions that may be achieved, and
other factors relevant under their respective statutory authorities.\6\
With respect to
[[Page 24009]]
technological feasibility, during MYs 2012-2016 manufacturers are
expected to go through the normal automotive business cycle of
redesigning and upgrading their light-duty vehicle products (and in
some cases introducing entirely new vehicles not on the market today).
The proposal under consideration is expected to allow manufacturers the
time needed to incorporate technology to achieve GHG reductions and
improve fuel economy during the vehicle redesign process. This is an
important aspect of the proposal under consideration, as it would avoid
the much higher costs that would occur if manufacturers needed to add
or change technology at times other than these scheduled redesigns.
This time period would also provide manufacturers the opportunity to
plan for compliance using a multi-year time frame, again in accord with
normal business practice. Over these five model years there would be an
opportunity for manufacturers to evaluate almost every one of their
vehicle model platforms and add technology in a cost effective way to
control GHG emissions and improve fuel economy. This includes redesign
of the air conditioner systems in ways that will further reduce GHG
emissions.
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\6\ The CAA requires EPA to establish ``standards applicable to
the emission of any air pollutant from new motor vehicles or new
motor vehicle engines which, in the Administrator's judgment, cause
or contribute to air pollution which may reasonably be anticipated
to endanger public health or welfare.'' As noted above, EPA has
proposed to find that GHGs emitted by new motor vehicles and new
motor vehicle engines contribute to air pollution that endangers
public health and welfare. Section 202(a) of the CAA further
provides that standards set pursuant to it ``shall 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.''
The EPCA requires that the CAFE standards for each model year be
set at the maximum feasible level. In determining that level, NHTSA
must consider technological feasibility, economic practicability,
the effect of other motor vehicle standards of the Government on
fuel economy, and the need of the United States to conserve energy.
NHTSA is prohibited from considering the availability of compliance
flexibilities such as the ability to earn credits for exceeding CAFE
standards in setting CAFE standards. Further, NHTSA must set the MY
2011-2020 CAFE standards sufficiently high to ensure that the
industry-wide average of all new passenger cars and light trucks,
combined, is not less than 35 miles per gallon by MY 2020.
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Technical work conducted by each agency over the last several years
indicates that there is a wide range of technologies available for
manufacturers to consider in upgrading vehicles to reduce GHG emissions
and improve fuel economy.\7\ These include improvements to the engines
such as use of gasoline direct injection and downsized engines that use
turbochargers to provide performance similar to that of larger engines,
the use of advanced transmissions, increased use of start-stop
technology, improvements in tire performance, reductions in vehicle
weight, increased use of hybrid and other advanced technologies, and
the initial commercialization of electric vehicles and plug-in hybrids.
Although many of these technologies are available today, the emissions
reductions and fuel economy improvements under consideration for the
proposal would be expected to involve more widespread use of these
technologies across the fleet.
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\7\ The close relationship between emissions of CO2--
the most prevalent greenhouse gas emitted by motor vehicles--and
fuel consumption, means that the technologies to control
CO2 emissions and to improve fuel economy overlap to a
great degree.
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Initial evaluations by EPA and NHTSA indicate that utilization of
this suite of technologies provides a strong technical basis to proceed
with consideration of a proposal containing MY 2016 GHG standards that
would on average achieve 250 gram/mile CO2. If the
automotive industry were to achieve this CO2 level all
through fuel economy improvements, this would equate to achieving a
fleet average level of 35.5 mpg. However, it is expected that most
companies would also apply some air conditioning improvements to reduce
GHG emissions. This would not translate into fuel economy improvements,
so on average we expect the fuel economy improvements to be somewhat
below the 35.5 mpg value.\8\
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\8\ As discussed in this section, these mile per gallon
equivalents should not be considered levels of potential CAFE
standards.
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The proposal under consideration would also include a harmonized
CAFE standard for MY 2016. Compatible GHG and CAFE standards for
earlier model years would increase from the MY 2011 CAFE standard to
the MY 2016 level of the National Program.
In developing their respective proposals, EPA and NHTSA will
consider many of the same issues. Given differences in their respective
statutory authorities, however, the agencies anticipate there will be
some important differences in the development of their proposals. For
example, under a GHG standard proposed under CAA section 202(a) EPA
would expect manufacturers to take advantage of the option to generate
credits by reducing emissions of HFCs and CO2 through
upgrades to their air conditioner systems. EPA plans to take these
reductions into account in developing a proposed GHG standard. However,
EPCA does not permit NHTSA to consider air conditioning credits in
developing a proposed CAFE standard for passenger cars. CO2
emissions due to air conditioning operation are not measured by the
test procedure mandated by statute for use in establishing and
enforcing CAFE standards for passenger cars. As a result, improvements
in the efficiency of passenger car air conditioners would not be
considered as a possible control technology for purposes of CAFE.
In addition, in developing a proposal EPA would take into
consideration all of the compliance flexibilities discussed below, such
as averaging, banking, and trading of credits, while NHTSA is
prohibited by statute from taking such flexibilities into account in
developing proposed CAFE standards. Manufacturer utilization of these
flexibilities, however, would be anticipated to provide important
savings in cost, promote more cost-effective GHG emissions control and
justify proposing more stringent GHG standards. As a result, the
agencies do not anticipate a one-to-one correspondence between the
level of EPA's proposed GHG standards and NHTSA's proposed CAFE
standards. Instead the CAFE standards under consideration for proposal
would be somewhat lower than the mile per gallon equivalent of the
corresponding GHG standard. This reflects both the specific differences
in standard setting criteria, as well as the general attempt by each
agency to harmonize its proposed standards in a way that allows them to
achieve their respective statutory and regulatory goals. The goal of
the proposal under consideration is providing regulatory compatibility
that allows auto manufacturers to build a single national light-duty
fleet that would comply with both the GHG and the CAFE standards.
Preliminary analysis indicates that the proposal under
consideration would result in GHG reductions and oil consumption
reductions that are very significant. Preliminary analysis indicates
cumulative greenhouse gas reductions of approximately 890 million
metric tons (CO2 equivalent) and fuel savings of
approximately 1.8 billion barrels of oil, over the lifetime of the
model years covered. Consumers would be expected to see cost savings
due to the significant fuel savings. As discussed below, the agencies
will conduct additional analyses of these matters.
B. Form of the Standards
Both EPA and NHTSA currently intend to propose attribute-based
standards for passenger cars and light-trucks. NHTSA adopted an
attribute standard based on vehicle footprint in its Reformed CAFE
program for light-trucks for model years 2008-2011,\9\ and recently
extended this approach to passenger cars in the CAFE rule for MY
2011.\10\ The agencies currently intend to propose vehicle footprint as
the attribute for the GHG and CAFE
[[Page 24010]]
standards, with footprint defined as a vehicle's wheelbase multiplied
by its track width--in other words, the area enclosed by the points at
which the wheels meet the ground. EPA and NHTSA believe initially that
the footprint attribute is the most appropriate attribute on which to
base the standards under consideration, as vehicle footprint correlates
reasonably well with CO2 emissions, fuel economy, and
consumer choice. In addition, the final rule issued by NHTSA for MY
2011 also discusses in some detail the relationship between mass,
weight, vehicle attributes like footprint, and safety.\11\
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\9\ 71 FR 17566; April 6, 2006.
\10\ 74 FR 14196; March 30, 2009.
\11\ 74 FR 14196; March 30, 2009.
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Under a footprint-based standard, each manufacturer would have a
GHG and CAFE standard unique to its fleet, with a separate standard for
passenger cars and light-trucks, depending on the footprints of the
vehicle models produced by that manufacturer. Generally, manufacturers
of larger vehicles (i.e., vehicles with larger footprints) would face
less stringent standards (i.e., higher CO2 grams/mile
standards and lower CAFE standards) than manufacturers of smaller
vehicles. While a manufacturer's fleet average standard could be
estimated throughout the model year based on projected sales volume of
its vehicle fleet, the standard of compliance would be based on the
final model year sales figures. A manufacturer's calculation of fleet
average emissions at the end of the model year would be based on the
sales-weighted average emissions of each model in its fleet.
EPA and NHTSA currently intend to propose separate footprint-based
standards, or curves, for passenger cars and light-trucks. In designing
the footprint-based standards, EPA and NHTSA intend to work together to
build upon the footprint standard curves used in the CAFE rule for MY
2011,\12\ and to consider proposing changes to the shape of the curve
based on, among other things, concerns about the steepness of the
slope. EPA and NHTSA intend to consider, among other things, an
approach that would generally flatten the passenger car curve, more in
line with the shape of the truck curve for the MY 2011 CAFE standard.
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\12\ 74 FR 14407-14409; March 30, 2009.
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C. Program Flexibilities for Achieving Compliance
As noted above, EPA and NHTSA expect to propose standards that are
intended to provide compliance flexibility to manufacturers, especially
in the early years of the program. This flexibility would be expected
to provide sufficient lead time to make necessary technological
improvements and additions, and reduce the overall cost of the program
without compromising overall environmental and fuel economy objectives.
The broad goal of harmonizing the two agencies' standards would include
preserving manufacturer flexibilities in meeting the standards. The
following section provides an overview of flexibility provisions the
agencies are contemplating in developing the program.
1. CO2/CAFE Credits Earned Based on Fleet Average
Performance
EPA and NHTSA currently intend to propose that the fleet average
standards that would apply to a manufacturer's car and truck fleets
would be based on the applicable attribute-based curves. At the end of
each model year, when sales of the model year are complete, a sales-
weighted fleet average would be calculated for each averaging set (cars
and trucks). Under this approach, a manufacturer's car and/or truck
fleet that achieves a fleet average CO2/CAFE level better
than the standard would earn credits. Conversely, if the fleet average
CO2/CAFE level does not meet the standard the fleet would
generate debits (also referred to as a deficit or negative credits).
Under the program being considered for proposal, a manufacturer
whose fleet generates credits in a given model year would have several
options for using those credits, including credit carry-back, credit
carry-forward, credit transfers, and credit trading. These provisions
exist in the MY 2011 CAFE program per EPCA, and similar provisions are
part of EPA's Tier 2 program for light duty vehicles' emissions of
criteria pollutants (as well as numerous other standards issued by EPA
under section 202 of the CAA). It is expected that, under the proposal
being considered, that the manufacturer would be able to carry-back
credits to offset any deficit that had accrued in a prior model year
and was subsequently carried over to the current model year. EPCA
restricts the carry-back of CAFE credits to three years and EPA is
currently contemplating proposing the same limitation, in keeping with
the goal of harmonizing both sets of proposed standards.
After satisfying any needs to offset pre-existing deficits within a
vehicle category, remaining credits could be saved (banked) for use in
future years. EPA is contemplating allowing manufacturers to use these
banked credits in at least the five years after the year in which they
were generated (i.e., five or more years carry-forward).
Another credit flexibility under consideration would be a
manufacturer's ability to transfer credits among its vehicle fleet to
achieve compliance with the standards. For example, credits earned by
over-compliance with a manufacturer's car fleet average standard could
be used to offset debits incurred due to that manufacturer's not
meeting the truck fleet average standard in a given year. EPCA provides
for this type of credit transfer with CAFE as does EPA within its Tier
2 program. EPA currently intends to propose unlimited credit transfers
across a manufacturer's car-truck fleet to meet the GHG standard. EPCA,
however, limits the amount of credits that may be transferred, and also
prohibits the use of transferred credits to meet the statutory minimum
for the domestic car fleet standard. These and other limits in EPCA
would continue to apply to the determination of compliance with the
CAFE standard.
Finally, proposals under consideration would allow accumulated
credits to be traded (sold) to other vehicle manufacturers. These sorts
of exchanges are typically allowed under EPA's current emission credit
programs, although manufacturers have seldom made such exchanges. EPCA
also allows these types of credit trades, although, as with transferred
credits, traded credits may not be used to meet the minimum domestic
standards.
2. Air Conditioning Credits
Air conditioning systems contribute to GHG emissions through the
leakage of hydrofluorocarbon refrigerants which are powerful GHG
pollutants, and also by placing an additional load on the engine, which
causes the engine to produce additional CO2 emissions. EPA
is considering an approach that would enable manufacturers to earn
credits by reducing GHG emissions related to air conditioning systems.
Under this approach, EPA would propose a test procedure and method to
calculate CO2 equivalent reductions on a gram/mile basis
that could be used as credits in meeting the fleet average
CO2 standards. The approach under consideration could
provide manufacturers with a highly cost-effective way to achieve a
portion of GHG emissions reductions under the EPA program. EPA is also
considering the possibility of allowing early air conditioning credits
that could be earned through air conditioning system improvements in
the years leading up to the start of the program.
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3. Flex-Fuel and Alternative Fuel Vehicle Credits
EPCA authorizes an incentive under the CAFE program for production
of dual-fueled or flexible-fuel vehicles (FFV) and dedicated
alternative fuel vehicles. FFVs are vehicles that can run both on an
alternative fuel and conventional fuel. Most FFVs are E-85 vehicles,
which can run on a mixture of up to 85 percent ethanol and gasoline.
Dedicated alternative fuel vehicles are vehicles that run exclusively
on an alternative fuel. EPCA's provisions were amended by the EISA to
extend the period of availability of the FFV credits, but to begin
phasing them out by annually reducing the amount of FFV credits that
can be used to help achieve compliance with the CAFE standards.\13\
EPCA does not premise the availability of the FFV credits on actual use
of alternative fuel. Under current law, after MY 2019, no FFV credits
will be available for CAFE compliance. For dedicated alternative fuel
vehicles, there are no limits or phase-out.
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\13\ EPCA provides a statutory incentive for production of FFVs
by specifying that their fuel economy is determined using a special
calculation procedure that results in those vehicles being assigned
a higher fuel economy level than would otherwise occur. This is
typically referred to as an FFV credit.
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For the GHG program, EPA contemplates proposing to allow FFV
credits in line with EISA limits only during the period from MYs 2012
to 2015. EPA will also consider allowing FFV credits beyond MY 2015 if
manufacturers are able to demonstrate that the alternative fuel is
actually being used in the vehicles. EPA is also considering how that
demonstration could be made.
4. Temporary Lead-Time Allowance Alternative Standards
EPA is considering a temporary lead-time allowance for
manufacturers whose sale of vehicles in the U.S. in a specified time
period is below a specified cut-off, such as sales of 400,000 vehicles
or less during a specified year, such as MY 2009 or 2010. This would
limit the number of vehicles to which the flexibility could apply. The
manufacturers that satisfy the threshold criteria would be able to
treat a limited number of vehicles as a separate averaging fleet, which
would be subject to a less stringent GHG standard.\14\ EPA is
considering a less stringent GHG standard that would be 125 percent of
the vehicle's otherwise applicable foot-print target level. EPA
envisions that this allowance would be available only during the MY
2012-2015 phase-in years of the program. Appropriate restrictions on
credit use would be expected to apply in the proposal under
consideration. These allowance vehicles would be expected to be
averaged into the manufacturer's fleet starting no later than MY 2016.
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\14\ EPCA does not permit such an allowance. Consequently,
manufacturers who may be able to take advantage of a lead-time
allowance under the CAA would be required to comply with the
applicable CAFE standard or be subject to penalties for non-
compliance.
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5. Additional Potential Credit Opportunities
EPA is considering opportunities for early credits in MYs 2009-2011
through over-compliance with a baseline standard that EPA is
considering. The baseline standard would be set to be equivalent, on a
national level, to the California standards. Potentially, credits could
be generated by over-compliance with this baseline in one of two ways--
over-compliance by the fleet of vehicles sold in California and the CAA
section 177 States, or over-compliance with the fleet of vehicles sold
in the 50 States. EPA is also considering allowing early credits based
on over-compliance with CAFE, but under the contemplated proposal only
for vehicles sold in States outside of California and the CAA section
177 States, and without use of FFV credits. Were this approach adopted,
the program would need to be designed to avoid double counting credits
between the two approaches.
EPA is currently considering proposing additional credit
opportunities to encourage the commercialization of advanced GHG/fuel
economy control technology such as electric vehicles and plug-in hybrid
electric vehicles. These ``super credits'' could take the form of a
multiplier that would be applied to the number of vehicles sold such
that they would count as more than one vehicle in the manufacturer's
fleet average. EPA is also considering allowing such credits to be
generated for years prior to MY 2012.
EPA is also considering an option for generation of credits for
employing technologies that achieve GHG reductions that are not
reflected on current test procedures. Examples of technologies that EPA
could consider include technologies such as solar panels on hybrids,
adaptive cruise control, and active aerodynamics, among other things.
D. Compliance
There are ample precedents established in previous EPA and NHTSA
regulations on which to develop an effective compliance program which
would achieve the energy and environmental benefits from CAFE and motor
vehicle GHG standards. EPA and NHTSA currently intend to propose a
program that recognizes and replicates as closely as possible the
compliance protocols associated with the existing CAA Tier 2 vehicle
emission standards, and with CAFE standards. The certification,
testing, reporting, and associated compliance activities could closely
track current practice and thus be familiar to manufacturers. EPA
already oversees testing, collects and processes test data, and
performs calculations to determine compliance with both CAFE and CAA
standards. In a coordinated approach, compliance mechanisms for both
programs could be consistent and non-duplicative.
The general approach under consideration would allow manufacturers
to satisfy the new program requirements in the same way they comply
with existing CAA and CAFE requirements. Manufacturers would
demonstrate compliance on a fleet-average basis at the end of each
model year, allowing model-level testing to continue throughout the
year as is the current practice for CAFE determinations. Although
statutory authorities and flexibilities available to EPA and NHTSA
differ, such a compliance program design could establish a single set
of manufacturer reporting requirements and rely on a single set of
underlying data, yet allow each agency to assess compliance with its
respective program.
Using currently available analyses, EPA and NHTSA do not anticipate
any significant noncompliance under the program being considered.
However, failure to meet the standards after credit opportunities are
exhausted would ultimately result in the potential for penalties under
EPCA, and under the CAA as well. The CAA allows considerable discretion
in assessment of penalties. Penalties under the CAA are typically
determined on a vehicle-specific basis by determining the number of a
manufacturer's highest emitting vehicles that caused the fleet average
standard violation. This is the same mechanism used for EPA's National
LEV and Tier 2 corporate average standards, and to date there have been
no instances of noncompliance. EPCA penalties are specified by statute
and would be assessed for the entire noncomplying fleet at a rate of
$5.50 times the number of vehicles in the fleet times the number of
tenths of mpg by which the fleet average falls below the standard. In
the event of a compliance action arising out of the same facts and
circumstances, EPA could consider CAFE penalties
[[Page 24012]]
when determining appropriate remedies for the EPA case.
III. Conclusion
There is a critically important need for our country to address
global climate change and to reduce oil consumption. In this context,
EPA and NHTSA currently intend to work in coordination to propose
standards for control of emissions of greenhouse gases and for fuel
economy, respectively. The EPA and the NHTSA plan to propose a strong
and coordinated Federal greenhouse gas and fuel economy program for MY
2012 through 2016 passenger cars, light-duty trucks, and medium-duty
passenger vehicles, as described above. Both agencies seek to propose a
coordinated program that can achieve important reductions of greenhouse
gas GHG emissions and improvements in fuel economy from the light-duty
vehicle part of the transportation sector, based on technology that
will be commercially available and that can be incorporated at a
reasonable cost.
The agencies anticipate issuing a joint proposal in the near
future, and welcome robust public participation in the rulemaking
process.
Dated: May 18, 2009.
Lisa P. Jackson,
Administrator, Environmental Protection Agency.
Dated: May 18, 2009.
Ray LaHood,
Secretary, Department of Transportation.
[FR Doc. E9-12009 Filed 5-21-09; 8:45 am]
BILLING CODE 6560-50-P