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

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

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July 18, 2018
Phase 2 Greenhouse Gas Emissions and Fuel Efficiency
Standards for Medium- and Heavy-Duty Engines and Vehicles
On October 25, 2016, the U.S. Environmental Protection
The agencies estimate that the Phase 2 standards will
Agency (EPA) and the National Highway Traffic Safety
achieve vehicle fuel savings of up to 25% beyond Phase 1
Administration (NHTSA) jointly published the second
when fully implemented and depending on the vehicle
phase of greenhouse gas (GHG) emissions and fuel
category (see Figure 1). Overall, the agencies estimate it
efficiency standards for medium- and heavy-duty vehicles
could cut GHG emissions by 1.1 billion metric tons of CO2
and engines (81 Federal Register 73478) through their
and conserve 2 billion barrels of oil over the lifetime of the
authorities under the Clean Air Act (CAA), as amended,
vehicles sold in the regulatory time frame.
and the Energy Independence and Security Act of 2007
(P.L. 110-140).
Under the agencies’ cost modeling, the Phase 2 standards
result in up to $260 billion in total benefits while costing
The Phase 2 rule sets emission standards for tractor-trailers,
the affected industry approximately $30 billion. Payback
vocational vehicles, and heavy-duty pickup trucks and vans.
periods for truck owners were determined to be favorable—
The rule expands on the Phase 1 standards (promulgated on
with the buyer of a new long-haul truck in 2027 recouping
September 15, 2011, for model years [MYs] 2014 through
the extra cost of the technology through fuel savings in less
2018; 76 Federal Register 57106) and introduces first-ever
than two years. Overall, vehicle owners could save an
controls on trailers (i.e., the part of the vehicle pulled by the
estimated $170 billion in fuel costs over the lifetime of the
tractor) and glider vehicles (i.e., a new chassis combined
vehicles sold in the regulatory time frame.
with an older engine). The standards phase in between MY
2021 and MY 2027 for engines and vehicles and between
Selected Issues
MY 2018 and MY 2027 for trailers and gliders. The
In general, reaction to the standards has been favorable.
agencies outline several benefits of the rule, including (1)
Many truck and engine manufacturers, drivers, fuel groups,
reducing carbon dioxide (CO2) emissions and fuel
and environmental organizations provided comments in
consumption from new on-road vehicles, (2) reducing the
support of the rule upon its proposal. Nevertheless, several
costs for transporting goods, and (3) spurring innovation in
issues may be of interest to Congress:
the clean energy technology sector.
Emissions Reductions
The California Air Resources Board (CARB) and some
”Heavy-duty trucks account for just 4% of all the vehicles on the
health and environmental organizations say that the rule is
highway.... But they’re responsible for about 20% of carbon
not aggressive enough, and they have pushed for more
pollution in the transportation sector.... And because they haul
stringent standards. On December 29, 2016, EPA approved
about 70% of all domestic freight—70% of the stuff we use,
California’s waiver request under Section 209(b) of the
everything from flat-screen TVs to diapers to produce to you
CAA to adopt its own MY 2014-2018 Phase 1 standards.
name it—every mile that we gain in fuel efficiency is worth
CARB expects to finalize its Phase 2 regulatory program by
thousands of dollars of savings every year.”
the end of 2018, which is similar to but distinct from the
Remarks by President Obama, February 18, 2014.
federal program.
Nitrogen Oxide (NOx) Standards
The Phase 2 rule maintains the underlying regulatory
Controls for NOx emissions (a precursor to ground-level
structure developed in Phase 1, such as the general
ozone) generally compete against fuel efficiency efforts.
categorization of medium- and heavy-duty vehicles and the
Air quality regulators from Southern California and 10
separate standards for engines and vehicles. It also retains
other local and state agencies across the nation filed a
the Phase 1 averaging, banking, and trading compliance
petition to EPA to promulgate more stringent NOx
provisions and its flexibilities for small businesses.
standards subsequent to the Phase 2 rule. EPA issued a
However, unlike Phase 1, the rule puts forth “technology-
memorandum in response to the petition on December 20,
advancing standards” (i.e., standards based “not only on
2016, stating that the agency would initiate rulemaking “for
currently available technologies but also on utilization of
a new on-highway heavy-duty NOx program with the
technologies now under development or not yet widely
intention of proposing standards that could begin in Model
deployed”). These may include advancements in the engine,
Year 2024.” However, under the Trump Administration,
transmission, driveline, aerodynamic design, lower rolling
sources are reporting the expectation of delays before EPA
resistance tires, and extended idle reduction technologies.
officials begin developing the standards.
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Phase 2 Greenhouse Gas Emissions and Fuel Efficiency Standards for Medium- and Heavy-Duty Engines and Vehicles
Figure 1. CO2 and Fuel Efficiency Reductions from the Medium- and Heavy-Duty Vehicle Standards

Source: Courtesy of International Council on Clean Transportation, under a Share Alike license of Creative Commons.
Notes: Classifications defined at 49 CFR 523.2 and 49 CFR 565.15.
Trailer Provisions
Glider Kit and Glider Vehicle Provisions
The Phase 2 rule includes standards for both engine
The term glider kit is used in the vehicle industry to
emissions and the vehicle as a whole, including
describe a chassis and cab assembly that is generally
requirements for improvements to the aerodynamics of
produced by a vehicle manufacturer without a new engine,
freight trailers. On September 22, 2016, the Truck Trailer
transmission, or rear axle. A third party then typically
installs used parts to complete the assembly. Historically,
Manufacturing Association (TTMA) filed petitions to EPA
gliders have been used as a means to salvage valuable
and the U.S. Court of Appeals for the D.C. Circuit, which
components from vehicles that were badly damaged in
contend that EPA lacks statutory authority under the CAA
collisions. Prior to the Phase 2 rulemaking, EPA and
to regulate the non-engine parts of vehicles. The court
NHTSA observed a sharp increase in glider sales,
granted EPA’s and NHTSA’s request to put the case on
suggesting to them that gliders were being used to
hold and stayed the trailer provisions as EPA reconsiders
circumvent standards for safety and emissions (e.g. NOx
them. EPA is working to develop a proposal.
and particulates). For this reason, EPA moved to apply
current emission standards to gliders under the Phase 2 rule.
Racecar Provisions
In the Phase 2 proposal, EPA included language that was
On July 10, 2017, several glider kit manufacturers filed a
intended to clarify tampering provisions with respect to
petition to EPA arguing that gliders should not be
considered “new motor vehicles” under the CAA, and thus
nonroad vehicles. However, industry groups claimed that
EPA does not have the authority to regulate them. On
the provisions would prevent owners from modifying motor
November 16, 2017, EPA issued a proposed repeal of the
vehicles used exclusively for racing. EPA removed the
requirements (82 Federal Register 53442). Upon review,
language from the final rule. Nevertheless, some argue that
the White House Office of Information and Regulatory
the underlying compliance uncertainty remains. Legislation
Affairs reportedly informed EPA that it needs a regulatory
to clarify it had been proposed in the 114th Congress (see
impact analysis before a final repeal can take effect. On
H.R. 4715/S. 2659) and the 115th Congress (see H.R. 350/S.
July 6, 2018, EPA announced an 18-month enforcement
203 and S.Hrg. 115-127). On December 27, 2016, the
pause on the Phase 2 production limits for glider vehicles as
Racing Enthusiasts and Suppliers Coalition filed petitions
it reconsiders the rule.
with EPA and the D.C. Circuit to address the uncertainty.
The petition was combined with TTMA’s and others and
Richard K. Lattanzio, Specialist in Environmental Policy
the case was put on hold (see above).
IF10927

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

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https://crsreports.congress.gov | IF10927 · VERSION 2 · NEW