Download EPA. Regulatory Impact Analysis: Final Rulemaking for 2017-2025 Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards PDF

TitleEPA. Regulatory Impact Analysis: Final Rulemaking for 2017-2025 Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards
Author
LanguageEnglish
File Size8.8 MB
Total Pages555
Table of Contents
                            Title Page
Table of Contents
Executive Summary
1 Technology Packages, Cost and Effectiveness
	1.1 Overview of Technology
	1.2 Technology Cost and Effectiveness
	1.3 Vehicle Package Cost and Effectiveness
	1.4 Use of the Lumped Parameter Approach in Determining Package Effectiveness
	1.5 Lumped Parameter Model Methodology
2 EPA’s Vehicle Simulation Tool
	2.1 Introduction
	2.2 Descriptions of EPA’s Vehicle Simulation Tool
	2.3 Applications of Simulation Tool for Final Rule
	2.4 On-Going and Future Work
3 Results of Final and Alternative Standards
	3.1 Introduction
	3.2 OMEGA model overview
	3.3 OMEGA Model Structure
	3.4 Model Inputs
	3.5 Analysis Results
	3.6 Per Vehicle Costs MYs 2021 and 2025
	3.7 Alternative Program Stringencies
	3.8 Comparative cost of advanced technologies under credit scenarios
	3.9 How Many of Today’s Vehicles Can Meet or Surpass the MY 2017-2025 CO2Footprint-based Targets with Current Powertrain Designs?
	3.10 Analysis of Ferrari & Chrysler/Fiat
	3.11 Cost Sensitivities
4 Projected Impacts on Emissions, Fuel Consumption, andSafety
	4.1 Introduction
	4.2 Analytic Tools Used
	4.3 Inputs to the emissions analysis
	4.4 Safety Analysis
	4.5 Sensitivity Cases
	4.6 Inventories Used for Non-GHG Air Quality Modeling
5 Vehicle Program Costs and Fuel Savings
	5.1 Technology Costs per Vehicle
	5.2 Costs of the MY 2017-2025 GHG Standards
	5.3 Cost per Ton of Emissions Reduced
	5.4 Reduction in Fuel Consumption and its Impacts
	5.5 Consumer Cost of Ownership, Payback Period and Lifetime Savings on New andUsed Vehicle Purchases
6 Health and Environmental Impacts
	6.1 Health and Environmental Impacts of Non-GHG Pollutants
	6.2 Air Quality Impacts of Non-GHG Pollutants
	6.3 Quantified and Monetized Non-GHG Health and Environmental Impacts
	6.4 Changes in Atmospheric CO2 Concentrations, Global Mean Temperature, Sea LevelRise, and Ocean pH Associated with the Final Rule’s GHG Emissions Reductions
7 Other Economic and Social Impacts
	7.1 Monetized GHG Estimates
	7.2 The Benefits Due to Reduced Refueling Time
	7.3 Summary of Costs and Benefits of the MYs 2017-2025 Final Rule
	7.4 Summary of Costs and Benefits of the MYs 2012-2016 & 2017-2025 Final Rules
8 Vehicle Sales and Employment Impacts
	8.1 Vehicle Sales Impacts
	8.2 Employment Impacts
9 Small Business Flexibility Analysis
10 Alternate Analysis Using 2010 MY Baseline
	10.1 Why an Alternate Analysis?
	10.2 Level of the standard
	10.3 Targets and Achieved Levels
	10.4 Manufacturer Compliance Costs
	10.5 Technology Penetrations
	10.6 GHG Impacts
	10.7 Fuel Savings
	10.8 Comparison to analysis using the MY 2008 based market forecast
                        
Document Text Contents
Page 1

Regulatory Impact Analysis:

Final Rulemaking for 2017-2025
Light-Duty Vehicle Greenhouse Gas
Emission Standards and Corporate
Average Fuel Economy Standards

Page 2

Assessment and Standards Division
Office of Transportation and Air Quality
U.S. Environmental Protection Agency

Regulatory Impact Analysis:


Final Rulemaking for 2017-2025
Light-Duty Vehicle Greenhouse Gas
Emission Standards and Corporate
Average Fuel Economy Standards




EPA-420-R-12-016
August 2012

Page 277

MY 2017 and Later - Regulatory Impact Analysis

5-5



Table 5.1-4 Scalars Applied to Interpolated Costs to Reflect Learning Effects

Scaler 2017 2018 2019 2020 2021 2022 2023 2024 2025

Costs as % of 2021 118% 114% 105% 102% 100%

Costs as % of 2025 133% 129% 120% 116% 114% 113% 111% 110% 100%

Note that scalars exclude AC-related costs.

AC-related costs as presented in Chapter 5 of the joint TSD were then added back in
to the interpolated costs by year. Note that the same cost for AC was used for each
manufacturer as we do not have unique AC-related costs by manufacturer.

The final step was to include our estimates of stranded capital. The stranded capital
costs used were based on those presented in Chapter 3 of this RIA where we presented
estimates of stranded capital for the 2016, 2021 and 2025 MYs. To estimate stranded capital
for the intervening years, we have done straight line interpolations to arrive at the stranded
capital costs shown in

Table 5.1-5. Note that the same stranded capital costs were used for both cars and
trucks except that no truck stranded capital costs were included for those manufacturers with
no truck sales (Aston Martin, Ferrari, Lotus and Tesla).

Table 5.1-5 Interpolated Estimates of Stranded Capital Costs (2010$)

Company 2017 2018 2019 2020 2021 2022 2023 2024 2025

Aston Martin $60 $54 $48 $41 $35 $31 $26 $21 $17

BMW $16 $20 $23 $27 $31 $26 $21 $16 $11

Chrysler/Fiat $53 $45 $38 $31 $24 $22 $20 $18 $16

Daimler $18 $19 $20 $21 $22 $19 $16 $13 $10

Ferrari $9 $16 $24 $32 $40 $35 $31 $26 $22

Ford $16 $17 $19 $20 $21 $18 $15 $12 $9

Geely $16 $20 $23 $26 $30 $25 $21 $16 $12

GM $18 $18 $18 $18 $18 $17 $16 $15 $14

Honda $12 $12 $13 $13 $13 $15 $17 $19 $21

Hyundai $7 $8 $8 $8 $9 $11 $12 $14 $15

Kia $14 $21 $28 $36 $43 $38 $34 $29 $25

Lotus $26 $23 $20 $16 $13 $12 $11 $11 $10

Mazda $17 $22 $28 $33 $38 $32 $26 $20 $13

Mitsubishi $15 $21 $27 $33 $39 $32 $26 $19 $13

Nissan $12 $12 $13 $13 $13 $14 $14 $14 $14

Porsche $19 $21 $23 $25 $27 $24 $21 $18 $15

Spyker $36 $30 $25 $20 $14 $14 $15 $15 $15

Subaru $8 $10 $11 $13 $15 $12 $10 $7 $5

Suzuki $28 $25 $21 $18 $14 $14 $13 $12 $11

Tata-JLR $17 $18 $19 $20 $21 $21 $20 $20 $20

Tesla $1 $1 $1 $0 $0 $0 $0 $0 $0

Toyota $5 $9 $12 $16 $19 $21 $22 $24 $25

Volkswagen $14 $17 $19 $22 $25 $20 $15 $10 $5

Fleet $14 $16 $17 $18 $20 $19 $18 $17 $16

Note: Results correspond to the 2008 baseline fleet.

Page 278

Chapter 5

5-6

The end results are presented in Table 5.1-6 for cars, Table 5.1-7 for trucks and Table
5.1-8 for the combined fleet.


Table 5.1-6 Control Case Costs by Manufacturer by MY including AC & Stranded
Capital Costs -- Cars (2010$)

Company 2017 2018 2019 2020 2021 2022 2023 2024 2025

Aston Martin $1,778 $3,296 $4,438 $5,588 $6,724 $7,173 $7,546 $7,854 $7,480

BMW $261 $475 $643 $804 $967 $1,351 $1,700 $2,024 $2,147

Chrysler/Fiat $256 $390 $491 $577 $681 $993 $1,257 $1,520 $1,617

Daimler $495 $944 $1,288 $1,633 $1,985 $2,358 $2,687 $2,981 $3,011

Ferrari $1,720 $3,250 $4,403 $5,565 $6,712 $7,280 $7,763 $8,174 $7,864

Ford $180 $334 $455 $564 $680 $1,042 $1,369 $1,676 $1,811

Geely-Volvo $577 $1,054 $1,414 $1,771 $2,132 $2,511 $2,851 $3,162 $3,177

GM $164 $272 $358 $435 $519 $834 $1,114 $1,389 $1,518

Honda $151 $266 $359 $443 $532 $843 $1,124 $1,396 $1,525

Hyundai $200 $373 $510 $640 $773 $1,066 $1,329 $1,578 $1,673

Kia $153 $295 $409 $516 $625 $928 $1,200 $1,459 $1,572

Lotus $987 $1,831 $2,469 $3,107 $3,739 $3,811 $3,850 $3,866 $3,566

Mazda $244 $460 $634 $795 $959 $1,288 $1,591 $1,877 $1,979

Mitsubishi $170 $303 $409 $508 $611 $1,026 $1,407 $1,765 $1,939

Nissan $171 $316 $430 $535 $644 $954 $1,234 $1,501 $1,618

Porsche $44 $61 $2,210 $3,120 $4,878 $5,018 $5,114 $5,176 $4,807

Spyker-Saab $810 $1,488 $2,000 $2,511 $3,019 $3,286 $3,513 $3,709 $3,580

Subaru $262 $482 $652 $815 $982 $1,295 $1,578 $1,842 $1,926

Suzuki $54 $65 $496 $679 $1,032 $1,388 $1,711 $2,009 $2,112

Tata-JLR $43 $58 $1,777 $2,506 $3,916 $4,392 $4,809 $5,176 $5,077

Tesla
DDDDD

$26 $41 $57 $66 $79 $77 $72 $71 $69

Toyota $130 $238 $325 $404 $488 $726 $942 $1,147 $1,239

Volkswagen $395 $729 $986 $1,238 $1,492 $1,816 $2,104 $2,369 $2,412

Fleet $206 $374 $510 $634 $767 $1,079 $1,357 $1,622 $1,726

Note: Results correspond to the 2008 baseline fleet; MY 2017-2018 costs for Porsche, Suzuki and Tata-JLR
reflect AC and stranded capital even though EPA assumed for purposes of this analysis that these companies
would use the intermediate volume manufacturer provisions allowing the MY 2016 standards to continue
through MY 2018. However, for Porsche, we note that this analysis was already completed before EPA learned
that, as of August 1, 2012, Volkswagen purchased 100% ownership of Porsche and, thus, EPA expects that in
actuality the Porsche fleet will be combined with the Volkswagen fleet for purposes of compliance with the MYs
2017-2025 standards.







DDDDD
While costs related to air-conditioning are shown for Tesla, as a manufacturer of solely electric vehicles,

Tesla can comply with reference, control, and alternative standards without incurring additional costs from this
regulation.

Page 554

Chapter 10

10-26

10.7 Fuel Savings

The expected impacts on fuel consumption are shown in Table 10-33. The gallons
reduced and kilowatt hours increased (kWh) as shown in the tables reflect impacts from the
final CO2 standards, including the A/C credit program, and include the increased fuel
consumption resulting from the rebound effect.

Table 10-33 – Fuel Consumption Impacts of the Final Standards and A/C Credit
Programs

Calendar Year
Petroleum-based

Gasoline Reference
(million gallons)

Petroleum-based
Gasoline Reduced
(million gallons)

Electricity Increased
(million kWh)



2017 125,346 209 92

2018 124,204 645 273

2019 123,247 1,297 544

2020 122,408 2,181 904

2021 121,775 3,441 1,357

2022 121,386 5,016 1,972

2023 121,210 6,866 2,751

2024 121,293 8,984 3,698

2025 121,645 11,353 4,809

2030 125,979 22,017 9,911

2040 139,497 35,838 16,748

2050 157,428 42,960 20,036

Total 5,186,805 833,756 383,605

Note: The electricity increase shown is that needed to charge EVs/PHEVs, not that generated by power plants;
results correspond to the 2010 baseline fleet.

Monetized fuel savings are shown in Table 10-34 and Table 10-35.

Table 10-34 – Undiscounted Annual Fuel Savings & Fuel Savings Discounted back to
2012 at 3% and 7% Discount Rates (millions of 2010 dollars)

Calendar
Year

Gasoline
Savings
(pre-tax)

Gasoline
Savings
(taxed)

Electricity
Costs

Total Fuel
Savings
(pre-tax)

Total Fuel
Savings
(taxed)

2017 $704 $794 $8.5 $696 $786

2018 $2,190 $2,460 $25.2 $2,160 $2,430

2019 $4,480 $5,040 $49.9 $4,430 $4,990

2020 $7,650 $8,570 $83 $7,570 $8,480

2021 $12,200 $13,600 $126 $12,100 $13,500

2022 $17,800 $19,900 $186 $17,600 $19,700

2023 $24,400 $27,200 $263 $24,100 $26,900

2024 $32,200 $35,800 $358 $31,800 $35,500

2025 $41,400 $45,900 $472 $40,900 $45,400

2030 $84,200 $92,900 $1,030 $83,100 $91,900

2040 $145,000 $159,000 $1,900 $143,000 $157,000

2050 $190,000 $205,000 $2,460 $188,000 $203,000

NPV, 3% $1,510,000 $1,650,000 $19,200 $1,490,000 $1,630,000

NPV, 7% $578,000 $634,000 $7,270 $571,000 $627,000

Note: Annual values represent undiscounted values; net present values represent annual costs discounted to
2012; results correspond to the 2010 baseline fleet.

Page 555

MY 2017 and Later - Regulatory Impact Analysis

10-27



Table 10-35 – Model Year Lifetime Present Value Fuel Savings Discounted to the 1
st


Year of each MY at 3% & 7% (millions of 2010 dollars)
NPV

at
2017 2018 2019 2020 2021 2022 2023 2024 2025 Sum

3%

Car $7,380 $13,700 $20,400 $27,300 $34,800 $42,700 $50,100 $58,200 $66,100 $321,000
Truck $158 $2,330 $4,310 $6,990 $14,900 $20,700 $26,300 $30,000 $38,000 $144,000
Total $7,540 $16,000 $24,700 $34,300 $49,700 $63,400 $76,400 $88,200 $104,000 $465,000

7%

Car $5,670 $10,600 $15,700 $21,000 $26,700 $32,900 $38,500 $44,800 $50,900 $247,000
Truck $119 $1,770 $3,270 $5,300 $11,300 $15,700 $19,900 $22,900 $28,800 $109,000
Total $5,790 $12,400 $19,000 $26,300 $38,000 $48,600 $58,400 $67,700 $79,700 $356,000

Note: Results correspond to the 2010 baseline fleet.



10.8 Comparison to analysis using the MY 2008 based market forecast

As noted in the introduction to this chapter, the MY 2010 baseline supports the
reasonableness of the standards finalized here. While there are minor differences in costs and
benefits, these minor differences support the overall analytic approach and results as robust
despite a significant change in inputs. Table 10-36 presents a high level comparison of the
two analyses.

Table 10-36 – Comparison of Analyses


Analysis using the MY 2008

based market forecast.
Analysis using the MY 2010

based market forecast

MY 2025 Per Vehicle Average
Costs relative to the MY 2016
standard reference case($)

$1,836 $1,785

MY Lifetime GHG emission
reductions (MMT CO2eq)

1,956 1,926

MY Lifetime Fuel savings (B.
Barrels)

3.9 3.8

CY 2030 GHG emission
reductions (MMT CO2eq)

271 262

CY 2030 Fuel savings (B.
Barrels)

0.55 0.53

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