The Role of Credits and Advanced Technologies in EPAs Light Duty GHG - PDF document

6/10/20 The Role of Credits and Advanced Technologies in EPA’s Light Duty GHG Standards Aaron Hula National Vehicle and Fuel Emissions Laboratory Office of Transportation and Air Quality U.S. Environmental Protection Agency 1 What Does OTAQ Do? Future Technology Analysis, Modeling, and Policy Conduct Emissions and Develop and Implement Evaluation Fuel Economy Testing Regulations Coordinate Voluntary Provide Consumer Certify and Partnerships Information Regulate Fuels 2 2 1

6/10/20 Regulating GHG Emissions: Today and Tomorrow Existing light-duty GHG emission and fuel economy standards have been established through model year 2026. Two questions for today: • How can advanced technologies be credited under the existing regulations? • How can EPA encourage and promote technologies that reduce emissions and protect the environment, beyond model year 2026? 3 3 EPA’s Light Duty Greenhouse Gas Program • EPA’s GHG standards are a credit based Averaging, Banking, and Trading (ABT) program • Manufacturers are in compliance with the current (and all previous) model years if they have a positive credit balance at the end of the model year Source: EPA Automotive Trends Report 4 4 2

6/10/20 What are Off-Cycle Credits? Off-Cycle credits reward technologies that achieve real-world GHG reductions, but are not fully captured on 2-cycle city/highway tests Manufacturers may generate credits for CO 2 reducing technologies where the CO 2 reduction benefit of the technology is not adequately captured on the Federal Test Procedure and/or the Highway Fuel Economy Test. These technologies must have a measurable, demonstrable, and verifiable real-world CO 2 reduction that occurs outside the conditions of the Federal Test Procedure and the Highway Fuel Economy Test. These optional credits are referred to as “off-cycle” credits . (40 CFR 86.1869-12) Eligible Technologies must NOT be: • Integral to basic vehicle design (FR 62836, October 2012) • Required by Federal law (FR 62836, October 2012) • Attributable to crash avoidance-systems (FR 62733, October 2012) 5 5 How do you generate Off-Cycle Credits? There are 3 pathways for off-cycle credits: 1) Menu Based 2) 5-cycle Testing 3) Alternative method Verify that the vehicle has a Perform additional testing Petition EPA using an technology on EPAs list of using EPA 5-cycle method Alternative method if option approved credits for specific (including high speed, rapid 1 and 2 are not applicable technologies accelerations, cold starts) to (40 CFR 86.1869-12) - Stop/Start demonstrate and justify - High efficiency lighting credits. - Active aerodynamics - Solar/thermal control - Active engine warmup MY 2018: 92% of credits MY 2018: <1% of credits MY 2018: 8% of credits 6 6 3

6/10/20 2018 Off-Cycle Menu Technology Implementation Manufacturers are using a variety of menu credits 7 7 Alternative Methodology Criteria • The methodologies described in the applications must meet the following criteria: • Use modeling, on-road testing, on-road data collection, or other approved analytical or engineering methods • Be robust, verifiable, and capable of demonstrating the real-world emissions benefit with strong statistical significance • Result in a demonstration of baseline and controlled emissions over a wide range of driving conditions and number of vehicles such that issues of data uncertainty are minimized • Result in data on a model type basis unless the manufacturer demonstrates that another basis is appropriate and adequate • EPA must seek public comment and publish each application 8 8 4

6/10/20 Alternative Methodology Criteria - Mercedes Example • Mercedes requested credits for their stop start system, based on the effectiveness of their technology and real world use for Mercedes vehicles. • EPA published the request for public comment and received 8 public comments. • Mercedes instrumented 29 consumer vehicles and acquired data on 1.4 million vehicles through Progressive Insurance to estimate Mercedes idle time, and system effectiveness. • EPA approved the credit methodology, but applied a more conservative approach. Small Car Mid Car Large Car Light Truck EPA “menu” credits 2.5 2.5 2.5 4.4 Mercedes application 11 9.1 19 17.1 Mercedes rebuttal 8.72 6.92 8.46 7.56 Approved methodology 4.3 3.7 3.7 3.6 9 9 Credits Approved through the Alternative Methodology • No manufacturers have requested credits for automated vehicle operation • Including adaptive cruise, etc. • Most requests have been related to technologies on the menu • Credits above the menu credit amount • Retroactive menu credits • Majority of current credits due to two technologies • A/C compressor with variable crankcase suction valve • High efficiency alternator • Approved applications available online: https://www.epa.gov/vehicle-and-engine-certification/compliance-information-light-duty- greenhouse-gas-ghg-standards 10 10 5

6/10/20 2018 Off-Cycle Total Credits Awarded Industry performance for model year 2018 was 253 g/mi, including 6.5 g/mi of off-cycle credits 11 11 Model Year 2018 Performance vs Standards Each manufacturer has unique car and truck standards based on average vehicle footprint Manufacturer performance = Tailpipe emissions adjusted for A/C credits, off-cycle credits, advanced technology credits, etc. This does NOT determine compliance! 12 12 6

6/10/20 Credit Balances at the end of Model Year 2018 All large manufacturers achieved compliance with the GHG standards through the 2018 model year. 13 13 Impacts of the SAFE Rule • Expands the program one model year, from 2025 to 2026 • Lowers the standards for 2021-2026 • From 4-5% annual change to about 1.5% • Adds high efficiency alternators to the preapproved off-cycle credit menu • Commits EPA to create a process to begin “allowing technology suppliers to begin the petition process” 14 14 7

6/10/20 Looking Forward • Can connected and autonomous technologies create off-cycle credits under the existing regulations? • Maybe… if you start collecting emissions data TODAY! • Off-menu applications are data and time intensive • Is there a better way? EPA’s National Vehicle and Fuel Emissions Laboratory • How can EPA encourage and promote Ann Arbor, MI advanced technologies that reduce emissions and protect the environment? • How do we account for system-wide impacts? – VMT, traffic, vehicle design, utilization, etc. 15 15 Appendix 16 16 8

6/10/20 Credit Transfers through Model Year 2018 Several manufacturers are buying, and selling, credits. Credits from model year 2017 and later last 5 years. 17 17 GHG Program Credit Summary The industry generated almost as many credits as it used in 2018, maintaining a large bank of credits for future model years. 18 18 9

6/10/20 Converting from g/mi to Tg 19 19 10