For light-duty vehicles, as part of the MY 2012 - 2016 rulemaking, EPA finalized standards for N2O and CH4 which take effect with MY 2012.  75 FR at 25421 - 24.  Similar to the heavy-duty standards discussed in Section II.E above, the light-duty vehicle standards for N2O and CH4 were established to cap emissions and to prevent future emissions increases, and were generally not expected to result in the application of new technologies or significant costs for the manufacturers for current vehicle designs.  EPA also finalized an alternative CO2 equivalent standard option, which manufacturers may choose to use in lieu of complying with the N2O and CH4 cap standards.  The CO2-equivalent standard option allows manufacturers to fold all N2O and CH4 emissions, on a CO2-equivalent basis, along with CO2 into their otherwise applicable CO2 emissions standard level.  For flexible fueled vehicles, the N2O and CH4 standards must be met on both fuels (e.g., both gasoline and E - 85).
After the light-duty standards were finalized, manufacturers raised concerns that they were having difficulty meeting the N2O and/or CH4 standards, especially in the early years of the program for a few of the vehicle models in their existing fleet.  This is problematic in the near-term because there is little lead time to implement unplanned redesigns of vehicles to meet the standards.  In such cases, manufacturers may need to either drop vehicle models from their fleet or to comply using the CO2 equivalent alternative.  On a CO2 equivalent basis, folding in all N2O and CH4 emissions would add 3 - 4 g/mile or more to a manufacturer's overall fleet-average CO2 emissions level because the alternative standard must be used for the entire fleet, not just for the problem vehicles. See 75 FR at 74211.  This could be especially challenging in the early years of the program for manufacturers with little compliance margin because there is very limited lead time to develop strategies to address these additional emissions. As stated at proposal, EPA believed this posed a legitimate issue of sufficiency of lead time in the short term, as well as an issue of cost, since EPA assumed that the N2O and CH4 standards would not result in significant costs for existing vehicles. Id.  However, EPA expected that manufacturers would be able to make technology changes (e.g., calibration or catalyst changes) to the few vehicle models not currently meeting the N2O and/or CH4 standards in the course of their planned vehicle redesign schedules in order to meet the standards.
Because EPA intended for these standards to be caps with little anticipated near-term impact on manufacturer's current product lines, EPA requested comment in the heavy-duty vehicle and engine proposal on two approaches to provide additional flexibilities in the light-duty vehicle program for meeting the N2O and CH4 standards. 75 FR at 74211.  EPA requested comments on the option of allowing manufacturers to use the CO2 equivalent approach for one pollutant but not the other for their fleet -- that is, allowing a manufacturer to fold in either CH4 or N2O as part of the CO2-equivalent standard.  For example, if a manufacturer is having trouble complying with the CH4 standard but not the N2O standard, the manufacturer could use the CO2 equivalent option including CH4, but choose to comply separately with the applicable N2O cap standard.
EPA also requested comments on an alternative approach of allowing manufacturers to use CO2 credits, on a CO2 equivalent basis, to offset N2O and CH4 emissions above the applicable standard.  This is similar to the approach proposed and being finalized for heavy-duty vehicles as discussed above in Section II.E.   EPA requested comments on allowing the additional flexibility in the light-duty program for MYs 2012 - 2014 to help manufacturers address any near-term issues that they may have with the N2O and CH4 standards.
Commenters providing comment on this issue supported additional flexibility for manufacturers, and manufacturers specifically supported the heavy-duty vehicle approach of allowing CO2 credits on a CO2 equivalent basis to be used to meet the CH4 and N2O standards.  The Alliance of Automobile Manufacturers and the American Automotive Policy Council commented that the proposed heavy-duty approach represented a significant improvement over the approach adopted for light-duty vehicles.  Manufacturers support de-linking N2O and CH4, and commented that the formation of the pollutants do not necessarily trend together.  Manufacturers also commented that a deficit against the N2O or CH4 cap would be required to be covered with CO2 credits for that model, but the approach does not "punish" manufacturers for using a specific technology (which could provide CO2 benefits, e.g., diesel, CNG, etc.) by requiring manufacturers to use the CO2-equivalent approach for their entire fleet.  The Natural Gas Vehicle Interests also supported allowing the use of CO2 credits on a CO2-equivalent basis for compliance with CH4 standards and urged providing this type of flexibility on a permanent basis.  The Institute for Policy Integrity also submitted comments supportive of providing additional flexibility to manufacturers as long as it does not undermine standard stringency. This commenter was supportive of either approach discussed at proposal.
Manufacturers supported not only adopting the aspects of the heavy-duty approach noted above, but the entire heavy-duty vehicle approach, including two aspects of the program not contemplated in EPA's request for comments.  First, manufacturers commented that EPA incorrectly characterizes the light-duty vehicle issues with CH4 and N2O as short-term or early lead time issues.  For the reasons discussed above, manufacturers believe the changes should be made permanent, for the entire 2012-2016 light duty rulemaking period and, indeed, in any subsequent rules for the light duty vehicle sector.  Second, manufacturers commented that N2O and CH4 should be measured on the combined 55/45 weighting of the FTP and highway cycles, respectively, as these cycles are the yardstick for fuel economy and CO2 measurement.  Manufacturers commented that there should not be a disconnect between the light-duty and heavy-duty vehicle programs.
EPA continues to believe that it is appropriate to provide additional flexibility to manufacturers to meet the N2O and CH4 standards.  EPA is thus finalizing provisions allowing manufacturers to use CO2 credits, on a CO2-equivalent basis, to meet the N2O and CH4 standards, which is consistent with many commenters' preferred approach.  Manufacturers will have the option of using CO2 credits to meet N2O and CH4 standards on a test group basis as needed for MYs 2012-2016.
In EPA's request for comments, EPA discussed the new flexibility as being needed to address lead time issues for MYs 2012-2014.  EPA understands that manufacturers are now making technology decisions for beyond MY 2014 and that some technologies such as FFVs may have difficulty meeting the CH4 and N2O standards, presenting manufacturers with difficult decisions of absorbing the 3-4 g/mile CO2-equivalent emissions fleet wide, making significant investments in existing vehicle technologies, or curtailing the use of certain technologies.  The CH4 standard, in particular, could prove challenging for FFVs because exhaust temperatures are lower on E-85 and CH4 is more difficult to convert over the catalyst.  EPA's initial estimate that these issues could be resolved without disrupting product plans by MY 2015 appears to be overly optimistic, and therefore EPA is extending the flexibility through model year 2016.  This change helps ensure that the CH4 and N2O standards will not be an obstacle for the use of FFVs or other technologies in this time frame, and at the same time, assure that overall fleet average GHG emissions will remain at the same level as under the main standards.
In response to comments from manufacturers and the Natural Gas Vehicle Interests that the changes to the program make sense and should be made on a permanent basis (i.e. for model years after 2016), EPA is extending this flexibility through MY 2016 as discussed above, but we believe it is premature to decide here whether or not these changes should be permanent.  EPA may consider this issue further in the context of new standards for MYs 2017-2025 in the planned future light-duty vehicle rulemaking.  With regard to comments on changing the test procedures over which N2O and CH4 emissions are measured to determine compliance with the standards, the level of the standards and the test procedures go hand-in-hand and must be considered together.  Weighting the highway test result with the city test result in the emissions measurement would in most cases reduce the overall emissions levels for determining compliance with the standards, and would thereby, in effect make the standards less stringent.  This appears to be inappropriate.  In addition, EPA did not request comments on changing the level of the N2O and CH4 standards or the test procedures and it is inappropriate to amend the standards for that reason as well.

EPA's Final Standards for Direct Emissions From Air Conditioning
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 associate with maintenance and servicing, and with disposal at the end of the vehicle's life.  The most commonly used refrigerant in automotive applications  -  R134a, has a high GWP of 1430.  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.
Heavy-duty air conditioning systems today are similar to those used in light-duty applications.  However, differences may exist in terms of cooling capacity (such that sleeper cabs have larger cabin volumes than day cabs), system layout (such as the number of evaporators), and the durability requirements due to longer truck life.  However, the component technologies and costs to reduce direct HFC emissions are similar between the two types of vehicles.
The quantity of GHG refrigerant emissions from heavy-duty trucks relative to the CO2 emissions from driving the vehicle and moving freight is very small.  Therefore, a credit approach is not appropriate for this segment of vehicles because the value of the credit is too small to provide sufficient incentive to utilize feasible and cost-effective air conditioning leakage improvements.  For the same reason, including air conditioning leakage improvements within the main standard would in many instances result in lost control opportunities.  Therefore, EPA is finalizing the proposed requirement that truck manufacturers  meet a low leakage requirement for all air conditioning systems installed in 2014 model year and later trucks, with one exception.  The agency is not finalizing leakage standards for Class 2b-8 Vocational Vehicles at this time 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, with consequent difficulties in developing a regulatory system.
EPA is finalizing 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.  The agency believes that a single "gram of refrigerant leakage per year" would not fairly address the variety of air conditioning system designs and layouts found in the heavy-duty truck sector.  EPA is finalizing a standard of 1.50 percent leakage per year for heavy-duty pickup trucks and vans and Class 7 and 8 tractors.  The final standard was derived from the vehicles with the largest system refrigerant capacity based on the Minnesota GHG Reporting database.  The average percent leakage per year of the 2010 model year vehicles is 2.7 percent.  This final level of reduction is roughly comparable to that necessary to generate credits under the light-duty vehicle program.  See 75 FR 25426-25427.  Since refrigerant leakage past the compressor shaft seal is the dominant source of leakage in belt-driven air conditioning systems, the agency is seeking comment on whether the stringency of a single "percent refrigerant leakage per year" standard fairly addresses the range of system refrigerant capacities likely to be used in heavy-duty trucks.  Since systems with less refrigerant may have a larger percentage of their annual leakage from the compressor shaft seal than systems with more refrigerant capacity, their relative percent refrigerant leakage per year could be higher, and a more extensive application of leakage reducing technologies could be needed to meet the standard).  EPA welcomes comments relative to the stringency of the standard, and on whether manufacturers who adopt measures that improve the global warming impact of leakage emissions substantially beyond that achieved by the final standard should in some way be credited for this improvement.
Manufacturers can choose to reduce A/C leakage emissions in two ways.  First, they can utilize leak-tight components.  Second, manufacturers can largely eliminate the global warming impact of leakage emissions by adopting systems that use an alternative, low-GWP refrigerant.  One alternative refrigerant, HFO-1234yf, has been approved for use in light-duty passenger vehicles under EPA's Significant New Alternatives Program (SNAP).  While the scope of this SNAP approval does not include heavy-duty highway vehicles, we expect that those interested in using this refrigerant in other sectors will petition EPA for broader approval of its use in all mobile air conditioning systems.  In addition, the EPA is currently acting on a petition to de-list R-134a as an acceptable refrigerant for new, light-duty passenger vehicles. The timeframe and scale of R-134a de-listing is yet to be determined, but any phase-down of R-134a use will likely take place after this rulemaking is in effect.  Given that HFO-1234yf is yet to be approved for heavy-duty vehicles, and that the timeframe for the de-listing of R-134a is not known, EPA believes that a leakage standard for heavy-duty vehicles is still appropriate.  EPA believes 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 apply to 2012 model year and later vehicles.  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.  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 2014. However, EPA does anticipate that updates to the SAE J2727 standard will be forthcoming (to address new materials and components which perform better than those originally used in the SAE analysis), and that it will be appropriate to include these updates in the regulations concerning refrigerant leakage.
Consistent with the 2012-2016 light-duty GHG rule, we are estimating costs for leakage control at $18 (2008$) in direct manufacturing costs.  Including a low complexity indirect cost multiplier (ICM) of 1.14 results in costs of $21 in the 2014 model year.  Time based learning is considered appropriate for A/C leakage control, so costs in the 2017 model year would be $19.  These costs are applied to all heavy-duty pickups and vans, and to all combination tractors.  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.
EPA proposes that manufacturers demonstrate improvements in their A/C system designs and components through a design-based method.  The  method for calculating A/C leakage 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. Under the final approach, manufacturers would choose from a menu of A/C equipment and components used in their vehicles in order to establish leakage scores, which would characterize their A/C system leakage performance and calculate the percent leakage per year as this score divided by the system refrigerant capacity.
Consistent with the light-duty GHG rule, EPA is finalizing a requirement that a manufacturer would compare the components of its A/C system with a set of leakage-reduction technologies and actions that is based closely on that being 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.  Like the cooperative industry-government program, our final approach would associate each component with a specific leakage rate in grams per year that is identical to the values in J2727 and then sum together the component leakage values to develop the total A/C system leakage.  However, in the heavy-duty truck program, the total A/C leakage score would then be divided by the value of the total refrigerant system capacity to develop a percent leakage per year.
EPA believes that the design-based approach would result in estimates of likely leakage emissions reductions that would be comparable to those that would eventually result from performance-based testing.  At the same time, comments are encouraged on all developments that may lead to a robust, practical, performance-based test for measuring A/C refrigerant leakage emissions.
CO2 emissions are also associated with air conditioner efficiency, since air conditioners create load on the engine.  See 74 FR 49529.  However, EPA is not  setting air conditioning efficiency standards for vocational vehicles and combination tractors.  The CO2 emissions due to air conditioning systems in these heavy-duty trucks are minimal compared to their overall emissions of CO2.  For example, EPA conducted modeling of a Class 8 sleeper cab using GEM to evaluate the impact of air conditioning and found that it leads to approximately 1 gram of CO2/ton- mile.  Therefore, a projected 24% improvement of the air conditioning system (the level projected in the light-duty GHG rulemaking), would only reduce CO2 emissions by less than 0.3 g CO2/ton-mile, or approximately 0.3 percent of the baseline Class 8 sleeper cab CO2 emissions.
EPA is not specifying a specific in-use standard for leakage, as neither test procedures nor facilities exist to measure refrigerant leakage from a vehicle's air conditioning system. However, consistent with the light-duty GHG 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 will require that manufacturers of heavy-duty vehicles attest to the durability of these systems, and provide an engineering analysis which demonstrates component and system durability.
Indirect Emissions From Air Conditioning
As just noted, in addition to direct emissions from refrigerant leakage, air conditioning systems also 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.
Ethanol-Fueled and Electric Vehicles
Current EPA emissions control regulations explicitly apply to heavy-duty engines and vehicles fueled by gasoline, methanol, natural gas and liquefied petroleum gas.  For multi-fueled vehicles they call for compliance with requirements established for each consumed fuel.  This contrasts with EPA's light-duty vehicle regulations that apply to all vehicles generally, regardless of fuel type.  As we proposed, we are revising the heavy-duty vehicle and engine regulations to make them consistent with the light-duty vehicle approach, applying standards for all regulated criteria pollutants and GHGs regardless of fuel type, including application to all-electric vehicles (EVs).  This provision will take effect in the 2014 model year, and be optional for manufacturers in earlier model years.  However, to satisfy the CAA section 202(a)(3) lead time constraints, the provision will remain optional for all criteria pollutants through the 2015 model year.  Commenters did not oppose this change in EPA regulations.
This change primarily affects manufacturers of ethanol-fueled vehicles (designed to operate on fuels containing at least 50 percent ethanol) and EVs.  Flex-fueled vehicles (FFVs) designed to run on both gasoline and fuel blends with high ethanol content will also be impacted, as they will need to comply with requirements for operation both on gasoline and ethanol.
The regulatory requirements we are finalizing today for certification on ethanol follow those already established for methanol, such as certification to NMHC equivalent standards and waiver of certain requirements.  We expect testing to be done using the same E85 test fuel as is used today for light-duty vehicle testing, an 85/15 blend of commercially-available ethanol and gasoline vehicle test fuel.  EV certification will also follow light-duty precedents, primarily calling on manufacturers to exercise good engineering judgment in applying the regulatory requirements, but will not be allowed to generate NOX or PM credits.
This provision is not expected to result in any significant added burden or cost.  It is already the practice of HD FFV manufacturers to voluntarily conduct emissions testing for these vehicles on E85 and submit the results as part of their certification application, along with gasoline test fuel results.  No changes in certification fees are being set in connection with this provision.  We expect that there will be strong incentives for any manufacturer seeking to market these vehicles to also want them to be certified:  (1) uncertified vehicles carry a disincentive to potential purchasers who typically have the benefit to the environment as one of their reasons for considering alternative fuels, (2) uncertified vehicles are not eligible for the substantial credits they could likely otherwise generate, (3) EVs have no tailpipe or evaporative emissions and thus need no added hardware to put them in a certifiable configuration, and (4) emissions controls for gasoline vehicles and FFVs are also effective on dedicated ethanol-fueled vehicles, and thus costly development programs and specialized components will not be needed; in fact the highly integrated nature of modern automotive products make the emission control systems essential to reliable vehicle performance.
Regarding technological feasibility, as mentioned above, HD FFV manufacturers already test on E85 and the resulting data shows that they can meet emissions standards on this fuel.  Furthermore, there is a substantial body of certification data on light-duty FFVs (for which testing on ethanol is already a requirement), showing existing emission control technology is capable of meeting even the more stringent Tier 2 standards in place for light-duty vehicles.
Feasibility Assessments and Conclusions
In this section, NHTSA and EPA discuss several aspects of our joint technical analyses.  These analyses are common to the development of each agency's final standards.  Specifically we discuss:  the development of the baseline used by each agency for assessing costs, benefits, and other impacts of the standards, the technologies the agencies evaluated and their costs and effectiveness, and the development of the final standards based on application of technology in light of the attribute based distinctions and related compliance measurement procedures.  We also discuss consideration of standards that are either more or less stringent than those adopted.
This program is based on the need to obtain significant oil savings and GHG emissions reductions from the transportation sector, and the recognition that there are appropriate and cost-effective technologies to achieve such reductions feasibly.  The decision on what standard to set is guided by each agency's statutory requirements, and is largely based on the need for reductions, the effectiveness of the emissions control technology, the cost and other impacts of implementing the technology, and the lead time needed for manufacturers to employ the control technology.  The availability of technology to achieve reductions and the cost and other aspects of this technology are therefore a central focus of this final rulemaking.
The NPRM proposed Alternative 6, and incorporated a broad range of technologies, described further below, after analyzing the potential costs and benefits of each alternative and weighing the statutory factors prescribed by 49 U.S.C. 32902(k)(2).  This section 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," and "adopt and implement appropriate test methods, measurement metrics, fuel economy standards, and compliance and enforcement protocols that are appropriate, cost-effective, and technologically feasible for commercial medium- and heavy-duty on-highway vehicles and work trucks."  The agency received comments on whether NHTSA had properly applied these statutory factors when determining the appropriate stringency level and technologies for the proposed standards.
CBD submitted several comments on whether NHTSA had met EISA's mandate to set standards "designed to achieve the maximum feasible improvement" and, to that end, appropriately considered feasible technologies in setting the stringency level.  CBD stated that the proposed rule had been limited to currently available technology, and that none of the alternatives contained all of the available technology, which it argued violated EISA.  CBD also stated that the phase-in schedule violated the technology-forcing intention of EISA, and that the agencies misperceived their statutory mandates, arguing that the agencies are required to force technological innovation through aggressive standards.  NHTSA recognizes that Congress intended EPCA (and by extension, EISA, which amended it) to be technology-forcing.  See Center for Auto Safety v. National Highway Traffic Safety Admin., 793 F.2d 1322, 1339 (D.C. Cir. 1986).  However, NHTSA believes it is important to distinguish between setting "maximum feasible" standards, as EPCA/EISA requires, and "maximum technologically feasible" standards, as CBD would have NHTSA do.  The agency must weigh all of the statutory factors in setting fuel efficiency standards, and therefore may not weigh one statutory factor in isolation of others.
Neither EPCA nor EISA define "maximum feasible" in the context of setting CAFE standards. Instead, NHTSA is directed to consider three factors when determining what the maximum feasible standards are  -  "appropriateness, cost-effectiveness, and technological feasibility."  32902(k)(2).  These factors modify "feasible" in the context of the MD/HD rule beyond a plain meaning of "capable of being done."  See Center for Biological Diversity v. National Highway Traffic Safety Admin., 538 F.3d 1172, 1194 (9th Cir. 2008).  EPCA "gives NHTSA discretion to decide how to balance the statutory factors  -  as long as NHTSA's balancing does not undermine the fundamental purpose of EPCA: energy conservation."  Id. at 1195.  Where Congress has not directly spoken to a potential issue, NHTSA's interpretation must be a "reasonable accommodation of conflicting policies... committed to the agency's care by the statute."  Id. (discussing consideration of consumer demand) (internal citations omitted).  In the context of light-duty, it was determined that Congress delegated the process for setting the maximum feasible standard to NHTSA with broad guidelines concerning the factors that the agency must consider.  Id. (emphasis in original).  This interpretation is applicable to the heavy-duty process, which prescribes statutory factors commiserate to, and equally broad as, those prescribed for light-duty.  Thus, NHTSA believes that it is firmly within our discretion to weigh and balance the factors laid out in 32902(k) in a way that is technology-forcing, as evidenced by these standards promulgated in this final rule, but not in a way that requires the application of technology not even yet in existence, as CBD suggests.
As described in Section I. F. (2) above, the proposed fuel consumption would remain in effect indefinitely at their 2018 or 2019 levels, as Congress did not specify a maximum duration period.  CBD stated that this would be a per se violation of EISA, as, by definition, standards which are not updated continually and regularly cannot be considered maximum feasible.  NHTSA would like to clarify that the NPRM specified that the standards would remain indefinitely "until amended by a future rulemaking action."  NPRM at 74172.  Further, as noted above, NHTSA has broad discretion to determine the maximum feasible standards.  Unlike § 32902(b)(3)(B), which applies to automobiles regulated under light-duty CAFE, § 32902(k) does not specify a maximum number of years that fuel economy standards for heavy-duty vehicles will be in place.  Consistent with its broad authority to define maximum feasible standards, NHTSA interprets its authority as including the discretion to define expiration periods where Congress has not otherwise specified.  This is particularly appropriate for the heavy-duty sector, where fuel efficiency regulation is unprecedented.  NHTSA believes that it would be unwise to set an expiration period for this first rulemaking absent both Congressional direction and a known compelling reason for setting a specific date.
Given the lead time mandated by EISA, NHTSA believes that the phase-in schedule provides an appropriate balance between the technology-forcing purpose of the statute and EISA-mandated considerations of economic practicability.  NHTSA is sensitive to the unique production practices of manufacturers of medium- and heavy-duty engines and vehicles, and believes that a phase-in schedule is necessary in order to provide manufacturers enough flexibility to incorporate the proposed technologies into their production schedules.  NHTSA recognizes, as noted in the case above, that balancing each statutory factor in order to set the maximum feasible standards means that the agency must engage in a "reasonable accommodation of conflicting policies."  See 538 F.3d at 1195, supra.  Here, the agency has determined that the phase-in schedule is one such reasonable accommodation.
Allison Transmission commented that NHTSA had improperly relied on the NAS report and failed to do sufficient independent analysis, which Allison claimed did not meet the statutory obligation to provide an adequate basis for the rule.  Consistent with EISA's direction, NAS submitted a report evaluating MD/HD fuel economy standards to NHTSA in March of 2010.  NHTSA reviewed the findings and recommendations of the NAS report when developing the proposed rule, as was clearly intended by Congress, but also conducted an independent study, laid on in Section X of the NPRM.  In conducting its analysis of the NAS report, several key recommendations, such as the use of fuel efficiency metrics, were found to be the best approach to implementing the new program.   However, the results of its own study, along with EPA's, led NHTSA to develop several aspects of the rule that are inconsistent with the NAS report, such as the separate regulation of engines and vehicles and the regulation of large manufacturers.  NHTSA believes that in explicitly directing the NAS report in the development of the new MD/HD program, Congress intended for it to play an important role in the agencies' analysis.  The purpose of NHTSA's study, conducted in the time available, was to bring together the NAS recommendations and the agencies' independent analysis to explain further the basis for the proposed standards.
Navistar stated that the baseline engines proposed in the NPRM, MY 2010 selective catalytic reduction (SCR)-equipped, could not meet the agencies' statutory obligation to set feasible standards, and requested instead that MY 2010 engines currently in-use be used to meet the feasibility factor.  Navistar further commented that the proposed rule overall is not technologically feasible, stating that the proposed standards assume technologies which are not in production for all manufacturers.  NHTSA has previously interpreted "technological feasibility" to mean "whether a particular method of improving fuel economy can be available for commercial application in the model year for which a standard is being established.'  74 FR 14196, 14216.  NHTSA has further clarified that the consideration of technological feasibility "does not mean that the technology must be available or in use when a standard is proposed or issued."  Center for Auto Safety v. National Highway Traffic Safety Admin., 793 F.2d 1322, 1325 n12 (D.C. Cir. 1986), quoting 42 Fed. Reg. 63, 184, 188 (1977).
Consistent with these previous interpretations, NHTSA believes that a technology does not necessarily need to be currently available or in use for all regulated parties to be "technologically feasible" for this rule, as long as it is reasonable to expect, based on the evidence before the agency, that the technology will be available in the model year in which the relevant standard takes effect.  The agencies provide multiple technology pathways for compliance with a standard, allowing each manufacturer to develop technologies which fit their current production and research, and the standards are based on fleet penetration rates of those technologies.  As discussed below, it is reasonable to assume that all the technologies incorporated in this final rule, including SCR-equipped engines, will be available over the period the standards are in effect.
The Institute for Policy Integrity (IPI) commented that the agencies should increase the scope and stringency of the final rule to the point at which net benefits would be maximized, citing Executive Orders 12866 and 13563.  EOs 12866 and 13563 instruct agencies, to the extent permitted by law, to select, among other things, the regulatory approaches which maximize net benefits.  NHTSA agrees with IPI about the applicability of these EOs and has made every effort to incorporate their guidance in drafting this rule.  Specifically, IPI commented that the agencies should regulate trailers at least to some degree, arguing that the agencies' reasoning for not doing so was insufficient and requesting a plan and schedule in the final rule for the future regulation of trailers.
The NPRM proposed to delay the regulation of trailers, as the inclusion would not be feasible at this time due to the diversity and complexity of the trailer industry, as well as a lack of critical information from the SmartWay program, industry and other key stakeholders.  Additionally, since a number of trailer manufacturing entities are small businesses, EPA and NHTSA need to allow sufficient time to convene a SBREFA panel to conduct the proper outreach to the potentially impacted stakeholders.  NHTSA agrees that the regulation of trailers, when appropriate, is likely to provide fuel efficiency benefits.  However, as discussed below, we continue to believe that both agencies must perform a more comprehensive assessment of the trailer industry, and therefore that their inclusion at this time is not feasible.
Though IPI agreed that the proposed rule was cost-benefit justified, IPI further stated that the agencies must implement an alternative that provides the maximum net benefits.  The agencies believe that standards that maximized net benefits would be beyond the point of technological feasibility for this first phase of the HD National Program.  The standards already require the maximum feasible fuel efficiency improvements for the HD fleet in the 2014-2018 timeframe.  Thus, even though, given the considerable cost-effectiveness of the technologies required by this rule, standards that maximized net benefits would likely be more stringent than those being promulgated in this final rule, NHTSA believes that standards that maximized net benefits would not be appropriate or technologically feasible in the rulemaking timeframe.  The Executive Orders cited by IPI do not require an agency to select a regulatory alternative that is inconsistent with its statutory obligations.  Thus, NHTSA has set fuel consumption standards for MYs 2016-2018 HD vehicles and engines at the maximum feasible level, but not at the level that maximizes net benefits.
Here, the focus of the standards is on applying fuel efficiency and emissions control technology to reduce fuel consumption, CO2 and other greenhouse gases.  Vehicles combust fuel to generate power that is used to perform two basic functions: 1) transport the truck and its payload, and 2) operate various accessories during the operation of the truck such as the PTO units.  Engine-based technology can reduce fuel consumption and CO2 emissions by improving engine efficiency, which increases the amount of power produced per unit of fuel consumed.  Vehicle-based technology can reduce fuel consumption and CO2 emissions by increasing the vehicle efficiency, which reduces the amount of power demanded from the engine to perform the truck's primary functions.
Our technical work has therefore focused on both engine efficiency improvements and vehicle efficiency improvements.  In addition to fuel delivery, combustion, and aftertreatment technology, any aspect of the truck that affects the need for the engine to produce power must also be considered.  For example, the drag due to aerodynamics and the resistance of the tires to rolling both have major impacts on the amount of power demanded of the engine while operating the vehicle.
The large number of possible technologies to consider and the breadth of vehicle systems that are affected mean that consideration of the manufacturer's design and production process plays a major role in developing the final standards.  Engine and vehicle manufacturers typically develop many different models based on a limited number of platforms.  The platform typically consists of a common engine or truck model architecture. For example, a common engine platform may contain the same configuration (such as inline), number of cylinders, valvetrain architecture (such as overhead valve), cylinder head design, piston design, among other attributes.  An engine platform may have different calibrations, such as different power ratings, and different aftertreatment control strategies, such as exhaust gas recirculation (EGR) or selective catalytic reduction (SCR).  On the other hand, a common vehicle platform has different meanings depending on the market.  In the heavy-duty pickup truck market, each truck manufacturer usually has only a single pickup truck platform (for example the F series by Ford) with common chassis designs and shared body panels, but with variations on load capacity of the axles, the cab configuration, tire offerings, and powertrain options.  Lastly, the combination tractor market has several different platforms and the trucks within each platform (such as LoneStar by Navistar) have less commonality.  Tractor manufacturers will offer several different options for bumpers, mirrors, aerodynamic fairing, wheels, and tires, among others.  However, some areas such as the overall basic aerodynamic design (such as the grill, hood, windshield, and doors) of the tractor are tied to tractor platform.
The platform approach allows for efficient use of design and manufacturing resources.  Given the very large investment put into designing and producing each truck model, manufacturers of heavy-duty pickup trucks and vans typically plan on a major redesign for the models every 5 years or more.  Recently, EPA's non-GHG heavy-duty engine program provided new emissions standards every three model years.  Heavy-duty engine and truck manufacturer product plans typically have fallen into three year cycles to reflect this regime.  While the recent non-GHG emissions standards can be handled generally with redesigns of engines and trucks, a complete redesign of a new heavy-duty engine or truck typically occurs on a slower cycle and often does not align in time due to the fact that the manufacturer of engines differs from the truck manufacturer.  At the redesign stage, the manufacturer will upgrade or add all of the technology and make most other changes supporting the manufacturer's plans for the next several years, including plans related to emissions, fuel efficiency, and safety regulations.
A redesign of either engine or truck platforms often involves a package of changes designed to work together to meet the various requirements and plans for the model for several model years after the redesign.  This often involves significant engineering, development, manufacturing, and marketing resources to create a new product with multiple new features.  In order to leverage this significant upfront investment, manufacturers plan vehicle redesigns with several model years of production in mind. Vehicle models are not completely static between redesigns as limited changes are often incorporated for each model year.  This interim process is called a refresh of the vehicle and it generally does not allow for major technology changes although more minor ones can be done (e.g., small aerodynamic improvements, etc).  More major technology upgrades that affect multiple systems of the vehicle thus occur at the vehicle redesign stage and not in the time period between redesigns.
As discussed below, there are a wide variety of CO2 and fuel consumption reducing technologies involving several different systems in the engine and vehicle that are available for consideration.  Many can involve major changes to the engine or vehicle, such as changes to the engine block and cylinder heads or changes in vehicle shape to improve aerodynamic efficiency.  Incorporation of such technologies during the periodic engine, transmission or vehicle redesign process would allow manufacturers to develop appropriate packages of technology upgrades that combine technologies in ways that work together and fit with the overall goals of the redesign.  By synchronizing with their multi-year planning process, manufacturers can avoid the large increase in resources and costs that would occur if technology had to be added outside of the redesign process.  We considered redesign cycles both in our costing and in assessing the lead time required.
As described below, the vast majority of technology required by this program is commercially available and already being utilized to a limited extent across the fleet.  Therefore the majority of the emission and fuel consumption reductions which would result from these final rules would result from the increased use of these technologies.  EPA and NHTSA also believe that these final rules will encourage the development and limited use of more advanced technologies, such as advanced aerodynamics in tractors and hybrid powertrains in some vocational vehicle applications.
In evaluating truck efficiency, NHTSA and EPA have excluded fundamental changes in the engine or truck's performance.  Put another way, none of the technology pathways underlying the final standards involve any alteration in vehicle utility.  For example, the agencies did not consider approaches that would necessitate reductions in engine power or otherwise limit truck performance.  The agencies have thus limited the assessment of technical feasibility and resultant vehicle cost to technologies which maintain freight utility.  Similarly, the agencies' choice of attributes on which to base the standards, and the metrics used to measure them, are consciously adopted to preserve the utility of heavy duty vehicles and engines.
The agencies worked together to determine component costs for each of the technologies and build up the costs accordingly. For costs, the agencies considered 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 approach utilized by the agencies in the 2012-16 MY light-duty fuel economy and GHG final rule. A bill of materials, in a general sense, is a list of components or sub-systems that make up a system --  in this case, an item of technology which reduces GHG emissions and fuel consumption. In order to determine what a system costs, one of the first steps is to determine its components and what they cost. NHTSA and EPA estimated these components and their costs based on a number of sources for cost-related information. In general, the direct costs of fuel consumption-improving technologies for heavy-duty pickups and vans are consistent with those used in the 2012-2016 MY light-duty GHG rule, except that the agencies have scaled up certain costs where appropriate to accommodate the larger size and/or loads placed on parts and systems in the heavy-duty classes relative to the light-duty classes.  For loose heavy-duty engines, the agencies have consulted various studies and have exercised engineering judgment when estimating direct costs.  For technologies expected to be added to vocational vehicles and combination tractors, the agencies have again consulted various studies and have used engineering judgment to arrive at direct cost estimates.  Once costs were determined, they were adjusted to ensure that they were all expressed in 2009 dollars using a ratio of gross domestic product deflators for the associated calendar years.
Indirect costs were accounted for using the ICM approach explained in Chapter 2 of the RIA, rather than using the traditional Retail Price Equivalent (RPE) multiplier approach.  For the heavy-duty pickup truck and van cost projections in this final action, the agencies have used ICMs developed for light-duty vehicles (with the exception that here return on capital has been incorporated into the ICMs, where it had not been in the light-duty rule) primarily because the manufacturers involved in this segment of the heavy-duty market are the same manufacturers that build light-duty trucks.  For the Class 7 and 8 tractor, vocational vehicle, and heavy-duty engine cost projections in this final rulemaking, EPA contracted with RTI International to update EPA's methodology for accounting for indirect costs associated with changes in direct manufacturing costs for heavy-duty engine and truck manufacturers.  In addition to the indirect cost multipliers varying by complexity and time frame, there is no reason to expect that the multipliers would be the same for engine manufacturers as for truck manufacturers.  The report from RTI provides a description of the methodology, as well as calculations of new indirect cost multipliers.  The multipliers used here include a factor of 5 percent of direct costs representing the return on capital for heavy-duty engines and truck manufacturers.  These indirect cost multipliers are intended to be used, along with calculations of direct manufacturing costs, to provide improved estimates of the full additional costs associated with new technologies.  The agencies did not receive any adverse comments related to this methodology.
Details of the direct and indirect costs, and all applicable ICMs, are presented in Chapter 2 of the RIA.  In addition, for details on the ICMs, please refer to the RTI report (See Docket ID EPA-HQ-OAR-2010-0162-0283).  Importantly, the agencies have revised the ICM factors and the way that indirect costs are calculated using the ICMs.  As a result, the ICM factors are now higher, the indirect costs are higher and, therefore, technology costs are higher.  The changes made to the ICMs and the indirect cost calculations are discussed in Section VIII of this preamble and are detailed in Chapter 2 of the RIA.
EPA and NHTSA believe that the emissions reductions called for by the final standards are technologically feasible at reasonable costs within the lead time provided by the final standards, reflecting our projections of widespread use of commercially available technology.  Manufacturers may also find additional means to reduce emissions and lower fuel consumption beyond the technical approaches we describe here.  We encourage such innovation through provisions in our flexibility program as discussed in Section IV.
The remainder of this section describes the technical feasibility and cost analysis in greater detail.  Further detail on all of these issues can be found in the joint RIA Chapter 2.
Class 7-8 Combination Tractor
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.  The agencies are adopting provisions to treat vocational tractors as vocational vehicles instead of combination tractors, as noted in Section II.B.  The focus of this section is on the feasibility of the combination tractors, 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.  The primary sources of information were the 2010 National Academy of Sciences report of Technologies and Approaches to Reducing the Fuel Consumption of Medium- and Heavy-Duty Vehicles, TIAX's assessment of technologies to support the NAS panel report, EPA's Heavy-duty Lumped Parameter Model, 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), and the technology cost analysis conducted by ICF for EPA.  Following on the EISA of 2007, the National Research Council appointed a NAS committee to assess technologies for improving fuel efficiency of heavy-duty vehicles to support NHTSA's rulemaking.  The 2010 NAS report assessed current and future technologies for reducing fuel consumption, how the technologies could be implemented, and identified the potential cost of such technologies.  The NAS panel contracted with TIAX to perform an assessment of technologies which provide potential fuel consumption reductions in heavy-duty trucks and engines and the technologies' associated capital costs.  Similar to the Lumped Parameter model which EPA developed to assess the impact and interactions of GHG and fuel consumption reducing technologies for light-duty vehicles, EPA developed a new version of that model to specifically address the effectiveness and interactions of the final pickup truck and light heavy-duty engine technologies.  The NESCAFF/ICCT study assessed technologies available in 2012 through 2017 to reduce CO2 emissions and fuel consumption of line haul combination tractors and trailers.  Lastly, the ICF report focused on the capital, maintenance, and operating costs of technologies currently available to reduce CO2 emissions and fuel consumption in heavy-duty engines, combination tractors, and vocational vehicles.
What Technologies Did the Agencies Consider to Reduce the CO2 Emissions and Fuel Consumption of tractors?
Manufacturers can reduce CO2 emissions and fuel consumption of combination tractors through use of, among others, engine, aerodynamic, tire, extended idle, and weight reduction technologies.  The standards in the final rule are premised on use of these technologies.  The agencies note that SmartWay trucks are available today which incorporate the technologies on whose performance the final standards are based.  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 rulemaking, for various reasons discussed below.
In this section we discuss the baseline tractor and engine technologies for the 2010 model year, and then discuss the types of technologies that the agencies considered to improve performance relative to this baseline, while section III.A.2 discusses the technology packages the agencies used to determine the final standard levels.
Baseline Tractor & Tractor Technologies
Baseline tractor:  The agencies developed the baseline tractor to represent the average 2010 model year tractor.  Today there is a large spread in aerodynamics in the new tractor fleet.  Trucks sold may reflect so-called classic styling (as described in Section II.B.3.c), or may be sold with aerodynamic packages.  Based on our review of current truck model configurations and Polk data provided through MJ Bradley, we believe the aerodynamic configuration of the baseline new truck fleet is approximately 25 percent Bin I, 70 percent Bin II, and 5 percent Bin III (as these bin configurations are explained above in Section II.B. (2)(c).  The baseline Class 7 and 8 day cab tractor consists of an aerodynamic package which closely resembles the Bin I package described in Section II.B. (2)(c), baseline tire rolling resistance of  7.8 kg/metric ton for the steer tire and 8.2 kg/ metric ton, dual tires with steel wheels on the drive axles, and no vehicle speed limiter.  The baseline tractor for the Class 8 sleeper cabs contains the same aerodynamic and tire rolling resistance technologies as the baseline day cab, does not include vehicle speed limiters, and does not include an idle reduction technology.  The agencies assume the baseline transmission is a 10 speed manual.  The agencies received a comment from the ICCT stating that the 0.69 Cd baseline for high roof sleepers published in the NPRM is higher than existing studies show. ICCT cited three studies including a Society of Automotive Engineering paper showing a lower Cd for tractor trailers.  The agencies based the average Cd for high roof sleepers on available in use fleet composition data, combined with an assessment of drag coefficient for different truck configurations.  The agencies are finalizing the 0.69 baseline Cd for high roof sleeper based on our assessment for the NPRM.  However, we will continue to gather information on the composition of the in-use fleet and may alter the baseline in a future action, should more data become available that demonstrates our estimate is incorrect.
Performance from this baseline can be improved by the use of the following technologies:
Aerodynamic technologies:  There are opportunities to reduce aerodynamic drag from the tractor, but it is 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.  As discussed in the TIAX report, the coefficient of drag (Cd) of a SmartWay sleeper cab high roof tractor is approximately 0.60, which is a significant improvement over a truck with no aerodynamic features which has a Cd value of approximately 0.80.  The GEM demonstrates that an aerodynamic improvement of a Class 8 high roof sleeper cab with a Cd value of 0.60 (which represents a Bin III tractor) provides a 5 percent reduction in fuel consumption and CO2 emissions over a truck with a Cd of 0.68.
Lower Rolling Resistance Tires:  A tire's rolling resistance results from 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.  The baseline rolling resistance coefficient for today's fleet is 7.8 kg/metric ton for the steer tire and 8.2 kg/metric ton for the drive tire, based on sales weighting of the top three manufacturers based on market share.  Since 2007, SmartWay trucks have had steer tires with rolling resistance coefficients of less than 6.6 kg/metric ton for the steer tire and less than 7.0 kg/metric ton for the drive tire.  Low rolling resistance (LRR) drive tires are currently offered in both dual assembly and single wide-base configurations.  Single wide tires can offer  rolling resistance reduction along with improved aerodynamics and weight reduction. The GEM demonstrates that replacing baseline tractor tires with tires which meet the Bin I level provides approximately a 4 percent reduction in fuel consumption and CO2 emissions over the prescribed test cycle, as shown in RIA Chapter 2, Figure 2-2.
Weight Reduction:  Reductions in vehicle mass reduce fuel consumption and GHGs by reducing the overall vehicle mass to be accelerated and also through increased vehicle payloads which can allow additional tons to be carried by fewer trucks consuming less fuel and producing lower emissions on a ton-mile basis.  Initially for proposal, the agencies considered evaluating vehicle mass reductions on a total vehicle basis for tractors and vocational trucks.  The agencies considered defining a baseline vehicle curb weight and the GEM model would have used the vehicle's actual curb weight to calculate the increase or decrease in fuel consumption related to the overall vehicle mass relative to that baseline.  After considerable evaluation of this issue, including discussions with the industry, we decided it would not be possible to define a single vehicle baseline mass for the tractors and for vocational trucks that would be appropriate and representative.  Actual vehicle curb weights for these classes of vehicles vary by thousands of pounds dependent on customer features added to vehicles and critical to the function of the vehicle in the particular vocation in which it is used.  This is true of vehicles such as Class 8 tractors considered in this section that may appear to be relatively homogenous but which in fact are quite heterogeneous.
This reality led us to the solution we proposed.  In the proposal, we reflected mass reductions for specific technology substitutions (e.g., installing aluminum wheels instead of steel wheels) where we could with confidence verify the mass reduction information provided by the manufacturer even though we cannot estimate the actual curb weight of the vehicle.  In this way, we accounted for mass reductions where we can accurately account for its benefits.
For the final action, based on analysis, the agencies developed an expanded list of weight reduction opportunities, as listed in Table II-5 in Section II.  The list includes additional components, but not materials, from those proposed in the NPRM.  For high strength steel, the weight reduction value is equal to 10 percent of the presumed baseline component weight, as the agencies used a conservative value based on the DOE report.  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.  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 substation and improved design.  We are finalizing for wheels that both aluminum and light weight aluminum are eligible to be used as light-weight materials.  Only aluminum can be used as a light-weight material for other components.  The reason for this is data was available for light weight aluminum for wheels but was not available for other components.
On average, these mass reduction technologies together can reduce weight by over 400 pounds. A weight reduction of this magnitude applied to a truck which travels at 70,000 pounds will have a minimal impact on fuel consumption.  However, for trucks which operate at the maximum GVWR which occurs approximately in one third of truck miles travelled, a reduced tare weight will allow for additional payload to be carried.  The GEM demonstrates that a weight reduction of 400 pounds applied to the payload tons for one third of the trips provides a 0.3 percent reduction in fuel consumption and CO2 emissions over the prescribed test cycle, as shown in Figure 2-3 of RIA Chapter 2.
Extended Idle Reduction:  Auxiliary power units (APU)s, fuel operated heaters, battery supplied air conditioning, and thermal storage systems are among the technologies available today to reduce main engine extended idling from sleeper cabs.  Each of these technologies reduces the baseline fuel consumption during idling from a truck without this equipment (the baseline) from approximately 0.8 gallons per hour (main engine idling fuel consumption rate) to approximately 0.2 gallons per hour for an APU.  EPA and NHTSA agree with the TIAX assessment of a 6 percent reduction in overall fuel consumption reduction.
Vehicle Speed Limiters: 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 a simple technology that is utilized today by some fleets (though the typical maximum speed setting is often higher than 65 mph).  The GEM shows that using a vehicle speed limiter set at 62 mph on a sleeper cab tractor will provide a 4 percent reduction in fuel consumption and CO2 emissions over the prescribed test cycles over a baseline vehicle without a VSL or one set above 65 mph.
Transmission:  As discussed in the 2010 NAS report, automatic and automated manual transmissions may offer the ability to improve vehicle fuel consumption by optimizing gear selection compared to an average driver.  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 0 to 8 percent.  Well-trained drivers would be expected to perform as well or even better than an automatic transmission since the driver can see the road ahead and anticipate a changing stoplight or other road condition that an automatic transmission can not anticipate.  However, poorly-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.  Although we believe there may be real benefits in reduced fuel consumption and GHG emissions through the application of dual clutch, automatic or automated manual transmission technology, we are not reflecting this potential improvement in our standard setting or in our compliance model.  We have taken this approach because we cannot say with confidence what level of performance improvement to expect.
Low Friction Transmission, Axle, and Wheel Bearing Lubricants:  The 2010 NAS report assessed low friction lubricants for the drivetrain as a 1 percent improvement in fuel consumption based on fleet testing.  The 2012-16 MY light-duty fuel economy and GHG final rule and the pickup truck portion of this program estimate that low friction lubricants can have an effectiveness value between 0 and 1 percent compared to traditional lubricants. However, it is not clear if in many heavy-duty applications these low friction lubricants could have competing requirements like component durability issues requiring specific lubricants with different properties than low friction.
Hybrid:  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 would duplicate many of the same emission reductions attributable to extended idle reduction.  NAS estimated that hybrid systems would cost approximately $25,000 per truck in the 2015 through 2020 timeframe and provide a potential fuel consumption reduction of 10 percent, of which 6 percent is idle reduction which can be achieved through other idle reduction technologies.  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 are not including hybrids in assessing standard stringency (or as an input to GEM).  However as discussed in Section IV, the agencies are providing incentives to encourage the introduction of advanced technologies including hybrid powertrains in appropriate applications.
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 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.
Baseline Engine & Engine Technologies
The baseline engine for the Class 8 tractors is a Heavy Heavy-Duty Diesel engine with 15 liters of displacement which produces 455 horsepower.  The agencies are using a smaller baseline engine for the Class 7 tractors because of the lower combined weights of this class of vehicles require less power, thus the baseline is an 11L engine with 350 horsepower.  The agencies developed the baseline diesel engine as a 2010 model year engine with an aftertreatment system which meets EPA's 0.20 grams of NOX/bhp-hr standard with an SCR system along with EGR and meets the PM emissions standard with a diesel particulate filter with active regeneration.  The baseline engine is turbocharged with a variable geometry turbocharger.  The following discussion of technologies describes improvements over the 2010 model year baseline engine performance, unless otherwise noted.  Further discussion of the baseline engine and its performance can be found in Section III.A.2.6 below.
With respect to stringency level, the agencies received comments from Cummins and Daimler stating that the proposed stringency levels were appropriate for the lead-times.  Navistar provided comments stating that the agencies used an artificially low baseline CO2 emissions level which was tilted toward the use of SCR aftertreatment system.  Conversely, the agencies received comments from several environmental groups (UCS, CATF, ACEEE) supporting a greater reduction in engine CO2 emissions and fuel consumption based on the NAS report. Navistar also stated that the agencies' baseline engine is inappropriate since there is not currently a 0.20 NOx compliant engine in production.  A discussion of how the baseline engine configuration can be found below in section (2)(b)(i).
Engine performance for CO2 emissions and fuel consumption can be improved by use of the following technologies:
Improved Combustion Process:  Fuel consumption reductions in the range of 1 to 3 percent over the baseline diesel engine are identified in the 2010 NAS report through improved combustion chamber design, higher fuel injection pressure, improved injection shaping and timing, and higher peak cylinder pressures.
Turbochargers:  Improved efficiency of a turbocharger compressor or turbine could reduce fuel consumption by approximately 1 to 2 percent over variable geometry turbochargers in the market today.  The 2010 NAS report identified technologies such as higher pressure ratio radial compressors, axial compressors, and dual stage turbochargers as design paths to improve turbocharger efficiency.
Higher efficiency air handling processes: 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 must include higher efficiency EGR systems and intercoolers that reduce frictional pressure loss while maximizing the ability to thermally control induction air and EGR.  The agencies received comments from Honeywell confirming that turbochargers provide a role in reducing the CO2 emissions from engines.  Other components that offer opportunities for improved flow efficiency include cylinder heads, ports and exhaust manifolds to further reduce pumping losses.  Variable air breathing systems such as variable valve actuation may provide additional gains at different loads and speeds.  The NESCCAF/ICCT study indicated up to 1.2% reduction could be achieved solely through improved EGR systems.
Low Temperature Exhaust Gas Recirculation: Most medium- and heavy-duty vehicle diesel engines sold in the U.S. market today use cooled EGR, in which part of the exhaust gas is routed through a cooler (rejecting energy to the engine coolant) before being returned to the engine intake manifold. EGR is a technology employed to reduce peak combustion temperatures and thus NOX. Low-temperature EGR uses a larger or secondary EGR cooler to achieve lower intake charge temperatures, which tend to further reduce NOX formation. If the NOX requirement is unchanged, low-temperature EGR can allow changes such as more advanced injection timing that will increase engine efficiency slightly more than 1 percent.  Because low-temperature EGR reduces the engine's exhaust temperature, it may not be compatible with exhaust energy recovery systems such as turbocompounding or a bottoming cycle.
Engine Friction Reduction:  Reduced friction in bearings, valve trains, and the piston-to-liner interface will improve efficiency. Any friction reduction must be carefully developed to avoid issues with durability or performance capability.  Estimates of fuel consumption improvements due to reduced friction range from 0 to 2 percent.
Reduced Parasitic Loads:  Accessories that are traditionally gear or belt driven by a vehicle's engine can be optimized and/or converted to electric power. Examples include the engine water pump, oil pump, fuel injection pump, air compressor, power-steering pump, cooling fans, and the vehicle's air-conditioning system. 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. The TIAX study 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. Bendix, in their comments to the agencies, confirmed that there are engine accessories available that can improve an engine's fuel efficiency.
Selective catalytic reduction:  This technology is common on 2010 the medium- and heavy-duty diesel engines used in Class 7 and 8 tractors (and the agencies therefore are considering it as part of the baseline engine, as noted above).  Because SCR is a highly effective NOX aftertreatment approach, it enables engines to be optimized to maximize fuel efficiency, rather than minimize engine-out NOX.  2010 SCR systems are estimated to result in improved engine efficiency of approximately 3 to 5 percent compared to a 2007 in-cylinder EGR-based emissions system and by an even greater percentage compared to 2010 in-cylinder approaches.  As more effective low-temperature catalysts are developed, the NOX conversion efficiency of the SCR system will increase. Next-generation SCR systems could then enable additional efficiency improvements; alternatively, these advances could be used to maintain efficiency while down-sizing the aftertreatment. We estimate that continued optimization of the catalyst could offer 1 to 2 percent reduction in fuel use over 2010 model year systems in the 2014 model year.  The agencies estimate an additional 1 to 2 percent reduction may be feasible in the 2017 model year through additional refinement.

Mechanical Turbocompounding:  Mechanical turbocompounding adds a low pressure power turbine to the exhaust stream in order to extract additional energy, which is then delivered to the crankshaft.  Published information on the fuel consumption reduction from mechanical turbocompounding varies between 2.5 and 5 percent. Some of these differences may depend on the operating condition or duty cycle that was considered by the different researchers. The performance of a turbocompounding system tends to be highest at full load and much less or even zero at light load.  The agencies did not receive any comments regarding the efficacy of mechanical turbocompound systems.
Electric Turbocompounding:  This approach is similar in concept to mechanical turbocompounding, except that the power turbine drives an electrical generator. The electricity produced can be used to power an electrical motor supplementing the engine output, to power electrified accessories, or to charge a hybrid system battery.  None of these systems have been demonstrated commercially, but modeled results by industry and DOE have shown improvements of 3 to 5 percent. The agencies did not receive any comments regarding the efficacy of electric turbocompound systems
Bottoming Cycle:  An engine with bottoming cycle uses exhaust or other heat energy from the engine to create power without the use of additional fuel.  The sources of energy include the exhaust, EGR, charge air, and coolant.  The estimates for fuel consumption reduction range up to 10 percent as documented in the 2010 NAS report.  However, none of the bottoming cycle or Rankine systems has been demonstrated commercially and are currently in only the research stage.  The agencies received comments from environmental stakeholders encouraging the agencies to include bottoming cycle technologies in setting the 2017 model year standards.   The agencies have evaluated the status of the development of bottoming cycle and continue to believe that its development is not yet at a stage to be included in 2017 model year technology package on which the standards are based.
Projected Technology Package Effectiveness and Cost
Class 7 and 8 Combination Tractors
EPA and NHTSA project that CO2 emissions and fuel consumption reductions can be feasibly and cost-effectively achieved in these rules' timeframes through the increased application of aerodynamic technologies, LRR tires, weight reduction, extended idle reduction technologies, vehicle speed limiters, and engine improvements.  As discussed above, the agencies believe that hybrid powertrains systems for tractors will not be sufficiently developed and the necessary manufacturing capacity put in place to base a standard on any significant volume of hybrid tractors.  As highlighted by the 2010 NAS report, the agencies do believe that hybrid powertrains have the potential in the longer term to provide significant improvements in fuel efficiency and to reduce greenhouse gas emissions.  The agencies also are not including drivetrain technologies in the standard setting process, as discussed in Section II.
The agencies evaluated each technology and estimated the most appropriate application rate of technology into each tractor subcategory.  The next sections describe the effectiveness of the individual technologies, the costs of the technologies, the projected application rates of the technologies into the regulatory subcategories, and finally the derivation of the final standards.
Baseline Tractor Performance
The agencies developed the baseline tractor for each subcategory to represent an average 2010 model year tractor configured as noted earlier.  The approach taken by the agencies was to define the individual inputs to GEM, as shown in Table III-1.  For example, the agencies evaluated the industry's tractor offerings and concluded that the average tractor contains a generally aerodynamic shape (such as roof fairings) and avoids classic features such as exhaust stacks at the B-pillar, which increase drag.  As noted earlier, our assessment of the baseline new high roof tractor fleet aerodynamics consists of approximately 25 percent Bin I, 70 percent Bin II, and 5 percent Bin III tractors.  The baseline rolling resistance coefficient for today's fleet is 7.8 kg/metric ton for the steer tire and 8.2 kg/metric ton for the drive tire, based on sales weighting of the top three manufacturers based on market share.  The agencies assumed no application of vehicle speed limiters, weight reduction technologies, or idle reduction technologies in the baseline tractor.  The agencies use the inputs in GEM to derive the baseline CO2 emissions and fuel consumption of Class 7 and 8 tractors.  The results are included in Table III-1.

Table III-1: Baseline Tractor Definitions

                                    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
                               Aerodynamics (Cd)
Baseline
                                     0.77
                                     0.72
                                     0.77
                                     0.72
                                     0.77
                                     0.87
                                     0.68
                        Steer Tires (Crr kg/metric ton)
Baseline
                                      7.8
                                      7.8
                                      7.8
                                      7.8
                                      7.8
                                      7.8
                                      7.8
                        Drive Tires (Crr kg/metric ton)
Baseline
                                      8.2
                                      8.2
                                      8.2
                                      8.2
                                      8.2
                                      8.2
                                      8.2
                             Weight Reduction (lb)
Baseline
                                       0
                                       0
                                       0
                                       0
                                       0
                                       0
                                       0
             Extended Idle Reduction (gram CO2/ton-mile reduction)
Baseline
                                      N/A
                                      N/A
                                      N/A
                                      N/A
                                       0
                                       0
                                       0
                             Vehicle Speed Limiter
Baseline
                                      --
                                      --
                                      --
                                      --
                                      --
                                      --
                                      --
                                    Engine
Baseline
                              2010 MY 11 L Engine
                              2010 MY 11 L Engine
                              2010 MY 15 L Engine
                              2010 MY 15 L Engine
                              2010 MY 15 L Engine
                              2010 MY 15 L Engine
                              2010 MY 15 L Engine

Table III-2: Class 7 and 8 Tractor Baseline CO2 Emissions and Fuel Consumption

                                    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
CO2 (grams CO2/ton-mile)
                                      115
                                      135
                                      87
                                      101
                                      79
                                      87
                                      91
Fuel Consumption (gal/1,000 ton-mile)
                                     11.3
                                     13.3
                                      8.6
                                      9.9
                                      7.7
                                      8.6
                                      9.0
Tractor Technology Package Definitions
The agencies' assessment of the final technology effectiveness was developed through the use of the GEM in coordination with chassis testing of three SmartWay certified Class 8 sleeper cabs.  The agencies developed the standards through a three-step process.  First, the agencies developed technology performance characteristics for each technology, described below.  Each technology is associated with an input parameter which is in turn modeled in GEM.  Table III-3 describes the performance levels for the range of Class 7 and 8 tractor aerodynamic packages and vehicle technologies.  Second, the agencies combined the technology performance levels with a projected technology application rate to determine the GEM inputs used to set the stringency of the final standards.  Third, the agencies input the parameters into GEM and used the output to determine the final CO2 emissions and fuel consumption levels.
Aerodynamics
The aerodynamic packages are categorized as Bin I, Bin II, Bin III, Bin IV, or Bin V based on the aerodynamic performance determined through testing conducted by the manufacturer.  A more complete description of these aerodynamic packages is included in Chapter 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.
Tire Rolling Resistance
The rolling resistance coefficient for the tires was developed from SmartWay's tire testing to develop the SmartWay certification, in addition to testing a small selection of tractor tires as part of this program.  The tire performance was evaluated in three levels - the baseline (average), 15 percent better than the average, and an additional 15 percent improvement.  The first 15 percent improvement represents the threshold used to develop SmartWay certified tires for long haul tractors.  The second 15 percent 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.
Weight Reduction
The weight reductions were developed from tire manufacturer information, the Aluminum Association, the Department of Energy, and TIAX, as discussed above in Section II.B.3.e.
Idle Reduction
The benefits for the extended idle reductions were developed from literature, SmartWay work, and the 2010 NAS report. The agencies received comments from multiple stakeholders regarding idle reduction technologies (IRT). Two commenters asked us to revise the default value associated with the IRT technology, and two commenters want to use IRT in GEM even without automatic engine shut down (AES).  The agencies proposed AES after 5 minutes with no exceptions to help ensure that the idle reductions are realized in-use.  Use of an AES ensures the main engine will be shut down, whereas idle reduction technologies alone do not provide that level of certainty. Without an automatic shutdown of the main engine, actual savings would depend on operator behavior and thus be essentially unverifiable. The agencies are finalizing the calculation as proposed, along with the automotive engine shutdown requirement.  Additional details regarding the comments and calculations are included in RIA Section <IP_ADDRESS>.
Several commenters requested that the level of emissions reductions vary in GEM by different idle reduction technologies, and one commenter requested that the application of battery powered APUs be incentivized.  The agencies recognize that the level of emission reductions provided by different IRT varies, but are adopting a conservative level to recognize that some vehicles may be sold with only an AES but may then install an IRT in-use.  Or some vehicles may be sold with one IRT but then choose to install alternative ones in-use.  The agencies cannot verify the savings which depend on operator behavior.
One commenter requested that we provide manufacturers with an option to allow the AES feature to be reprogammable after a specified number of miles or time in service.  The agencies recognize that AES may impact the resale value of tractors and, in response to comments, are adopting provisions for the optional expiration of an AES.  Thus, the initial buyer could select AES only for the number of miles based on the expected time before resale. Similar to vehicle speed limiters, we would discount the impact based on the full life of the truck (e.g. 1,258,788  miles). Additional detail can be found in RIA Section <IP_ADDRESS>.
Vehicle Speed Limiter
The agencies are not including vehicle speed limiters in the technology package for Class 7 and 8 tractors.
Summary of Technology Performance
Table III-3 describes the performance levels for the range of Class 7 and 8 tractor aerodynamic packages and vehicle technologies.
Table III-3: Class 7 and 8 Tractor Technology Values

                                    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
                               Aerodynamics (Cd)

Bin I
                                     0.77
                                     0.78
                                     0.77
                                     0.78
                                     0.77
                                     0.87
                                     0.74
Bin II
                                     0.71
                                     0.70
                                     0.71
                                     0.70
                                     0.71
                                     0.82
                                     0.66
Bin III

                                     0.62

                                     0.62

                                     0.58
Bin IV

                                     0.54

                                     0.54

                                     0.50
Bin V

                                     0.50

                                     0.50

                                     0.46
                        Steer Tires (Crr kg/metric ton)
Baseline
                                      7.8
                                      7.8
                                      7.8
                                      7.8
                                      7.8
                                      7.8
                                      7.8
Bin I
                                      6.6
                                      6.6
                                      6.6
                                      6.6
                                      6.6
                                      6.6
                                      6.6
Bin II
                                      5.7
                                      5.7
                                      5.7
                                      5.7
                                      5.7
                                      5.7
                                      5.7
                        Drive Tires (Crr kg/metric ton)
Baseline
                                      8.2
                                      8.2
                                      8.2
                                      8.2
                                      8.2
                                      8.2
                                      8.2
Bin I
                                      7.0
                                      7.0
                                      7.0
                                      7.0
                                      7.0
                                      7.0
                                      7.0
Bin II
                                      6.0
                                      6.0
                                      6.0
                                      6.0
                                      6.0
                                      6.0
                                      6.0
                             Weight Reduction (lb)
Control
                                      400
                                      400
                                      400
                                      400
                                      400
                                      400
                                      400
           Extended Idle Reduction (gram CO2/ton-mile reduction)[a]
Control
                                      N/A
                                      N/A
                                      N/A
                                      N/A
                                       5
                                       5
                                       5
                           Vehicle Speed Limiter[b]
Control
                                      N/A
                                      N/A
                                      N/A
                                      N/A
                                      N/A
                                      N/A
                                      N/A
Notes:
 [a] While the standards are set based on this value, users would enter another value if AES is not applied or applied for less than the full useful life of the engine.
[b] Vehicle speed limiters are an applicable technology for all Class 7 and 8 tractors, however the standards are not premised on the use of this technology.
Tractor Technology Application Rates
As explained above, vehicle 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.  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 application used to develop the final standards, NHTSA and EPA established technology application 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, idle reduction technologies are limited to Class 8 sleeper cabs using the assumption that day cabs are not used for overnight hoteling.  A second type of constraint was applied to most other technologies and limited their application based on factors reflecting the real world operating conditions that some combination tractors encounter.  This second type of constraint was applied to the aerodynamic, tire, and vehicle speed limiter technologies.  Table III-4 specifies the application rates that EPA and NHTSA used to develop the final standards.  The agencies received a significant number of comments related to this second basis.  In particular, commenters questioned the reasons for not requiring the maximum feasible reduction technology in every case.  The agencies have not done so because we have concluded that within each of these individual vehicle categories there are particular applications where the use of the identified technologies would be either ineffective or not technically feasible.  The addition of ineffective technologies provides no environmental benefit, increases costs and is not a basis upon which to set a maximum feasible improvement.  For example, the agencies have not required the use of full aerodynamic vehicle treatments on 100 percent of tractors because we know that in many applications (for example gravel truck engaged in local aggregate delivery) the added weight of the aerodynamic technologies will increase fuel consumption and hence CO2 emissions to a greater degree than the reduction that would be accomplished from the more aerodynamic nature of the truck.  To simply set the standard based on the largest reduction possible estimated narrowly over a single test procedure while ignoring the in-use effects of the technology would in this case result in a perverse outcome that is not in keeping with the agencies' goals nor the requirements of the CAA and EPCA.
Aerodynamics Application Rate
The impact of aerodynamics on a truck's efficiency increases with vehicle speed.  Therefore, the usage pattern of the truck 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 are adopting the most aggressive aerodynamic technology application to this regulatory subcategory.  All of the major manufacturers today offer at least one SmartWay truck model.  The 2010 NAS Report on heavy-duty trucks found that manufacturers indicated that aerodynamic improvements which yield 3 to 4 percent fuel consumption reduction or 6 to 8 percent reduction in Cd values, beyond technologies used in today's SmartWay trucks are achievable.  The aerodynamic application rate for Class 8 sleeper cab high roof cabs (i.e., the degree of technology application on which the stringency of the final standard is premised) consists of 20 percent of Bin IV, 70 percent Bin III, and 10 percent Bin II reflecting our assessment of the fraction of tractors in this segment that can successfully apply these aerodynamic packages.
The 90 percent of tractors that we project can either be Bin II or Bin III equipped reflects the bulk of Class 8 high roof sleeper cab applications.  We are not projecting a higher fraction of Bin III aerodynamic systems because of the limited lead time for the program and the need for these more advanced technologies to be developed and demonstrated before being applied across a wider fraction of the fleet.  Our averaging, banking and trading provisions provide manufacturers with the flexibility to implement these technologies over time even though the standard changes in a single step.
The final aerodynamic application for the other tractor regulatory categories is less aggressive than for the Class 8 sleeper cab high roof.  The agencies recognize that there are truck applications which 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.  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 would prevent 100 percent application of SmartWay technologies for all of the tractor regulatory subcategories.
As discussed in Section II.B.2.c, in response to comments received from manufacturers, the agencies are finalizing only two aerodynamic bins for low and mid roof tractors.  The agencies are reducing 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.  As mentioned in Section II.B.2.c, the types of designs that would move high roof tractors from a Bin III to Bins IV and V include features such as gap reducers and integral roof fairings which would not be appropriate on low and mid roof tractors.  Thus, the agencies are differentiating the aerodynamic performance for low- and mid-roof tractors into two bins  -  Bin I and Bin II.  The application rates in the low and mid roof categories are the same as proposed, but aggregated into just two bins.  Bin I for these tractors corresponds to the proposed "Classic" and "Conventional" bins and Bin II corresponds to the proposed "SmartWay," "Advanced SmartWay," and "Advanced SmartWay II" bins.
Low Rolling Resistance Tire Application Rate

At least one LRR tire model is available today that meets the rolling resistance requirements of the Bin I and Bin II tire packages so the 2014 MY should afford manufacturers sufficient lead time to install these packages.  However, tire rolling resistance is only one of 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 final standards should not be premised on 100 percent application of LRR tires in all tractor segments given the interference with vehicle utility that would result.  The agencies are basing their analyses on application rates that vary by subcategory  recognizing that some subcategories require a different balancing of performance versus rolling resistance.
Weight Reduction Technology Application Rate
The agencies proposed setting the 2014 model year tractor standards using 100 percent application of a 400 pound weight reduction package.  Volvo and ATA stated in their comments that not all fleets can use single wide tires and if this is the case the 400 pound weight reduction cannot be met.  The agencies also received comments from MEMA, Navistar, American Chemistry Council, the Auto Policy Center, Iron and Steel Institute, Arvin Meritor, Aluminum Association, and environmental groups and NGOs identifying other potential weight reduction opportunities for tractors.  As described in Section II.B.3.e above, the agencies are adopting an expanded list of weight reduction options for the final rulemaking.
The agencies, upon further analysis, continue to believe that a 400 pound weight reduction package is appropriate for tractors in the timeframe.  For tractors where single wide tires are not appropriate, the manufacturers have additional options to available achieve weight reduction, such as body panels and chassis components. Therefore, the agencies are adopting the proposed 100 percent application of a 400 pound weight reduction package to all tractors.
Idle Reduction Technology Application 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, and therefore will be available in the 2014 model year.  There are several different technologies available to reduce idling.  These include APUs, diesel fired heaters, and battery powered units.  Our discussions with manufacturers indicate that idle technologies are sometimes installed in the factory, but it is also a common practice to have the units installed after the sale of the truck.  We would like 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.  Therefore, as proposed, we are allowing only idle emission reduction technologies with include an automatic engine shutoff (AES).  We are also adopting some override provisions in response to comments we received (as explained below). As proposed, we adopting a 100 percent application rate for this technology for Class 8 sleeper cabs, even though the current fleet is estimated to have a 30 percent application rate.  The agencies are unaware of reasons why AES with extended idle reduction technologies could not be applied to all tractors with a sleeper cab in the available lead time.
The agencies received comment that we should extend the idle reduction benefits beyond Class 8 sleepers, including Class 7 tractors and vocational vehicles. 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.  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.  The agencies are not able to appropriately develop a baseline of workday idling for the other types of vehicles and identify the percent of this idling which could be reduced through the use of AES.
One commenter stated the application rate of AES should be less than 100 percent, but did not recommend an alternative application rate or provide justification for a change. The agencies re-evaluated the proposed 100 percent application rate and determined that a 100 percent application rate for this technology for Class 8 sleeper cabs remains appropriate. The agencies have also considered the many comments which raised concerns about the proposed mandatory 5 minute automatic engine shut down without override capability (in terms of safety, extreme temperatures and low battery conditions).  To avoid unintended adverse impacts, we are adopting limited override provisions. Three of the five exceptions are similar to those currently in effect under a California Air Resources Board (CARB) regulation. CARB provides AES exceptions (or overrides) within its existing heavy-duty vehicle anti-idling law, which were developed to address these same types of  concerns. The exceptions we are adopting include override capability during exhaust emissions control device regeneration, during engine servicing and maintenance, when battery state of charge is too low, in extreme ambient temperatures, when engine coolant temperature is too low, and during PTO operation.  The RIA provides more detail about these final override provisions in Section <IP_ADDRESS>.
Vehicle Speed Limiter Application Rate
Vehicle speed limiters may be used as a technology to meet the standard, but in setting the standard we assumed a zero percent application rate of vehicle speed limiters.    Although we believe vehicle speed limiters are a simple, easy to implement, and inexpensive technology, we want to leave the use of vehicles speed limiters to the truck purchaser.  Since truck fleets purchase trucks today with owner set vehicle speed limiters, we considered not including VSLs in our compliance model. However, we have concluded that we should allow the use of VSLs that cannot be overridden by the operator as a means of compliance for vehicle manufacturers that wish to offer it and truck purchasers that wish to purchase the technology.  In doing so, we are providing another means of meeting that standard that can lower compliance cost and provide a more optimal vehicle solution for some truck fleets.  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 a 55 mph for this customer.  The resulting truck modeled in GEM could meet our final emission standard without the use of any specialized aerodynamic fairings.  The resulting truck would be optimized for its intended application and would be fully compliant with our program all at a lower cost to the ultimate truck purchaser.  .
We have chosen not to base the standards on performance of VSLs because of concerns about how to set a realistic application rate that avoids unintended adverse impacts.  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.  However, at this point the agencies are not in a position to determine in how many additional situations use of a VSL would result in similar benefits to overall efficiency.  Setting a mandatory expected use of such VSL carries the risk of requiring VSL in situations that are not appropriate from an efficiency perspective.  To avoid such possibility, the agencies are not premising the final standards on use of VSL, and instead will rely on the industry to select VSL when circumstances are appropriate for its use.  The agencies have not included either the cost or benefit due to VSLs in analysis of the program's costs and benefits.  Implementation of this program may provide greater information for using this technology in standard setting in the future.  Many stakeholders including the American Trucking Association have advocated for more widespread use of vehicle speed limits to address fuel efficiency and greenhouse gas emissions.
Table III-4 provides the final application rates of each technology broken down by weight class, cab configuration, and roof height.
Table III-4:  Final Technology Application Rates for Class 7 and 8 Tractors

                                    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
                               Aerodynamics (Cd)
Bin I
                                      40%
                                      0%
                                      40%
                                      0%
                                      30%
                                      30%
                                      0%
Bin II
                                      60%
                                      30%
                                      60%
                                      30%
                                      70%
                                      70%
                                      10%
Bin III

                                      60%

                                      60%

                                      70%
Bin IV

                                      10%

                                      10%

                                      20%
Bin V

                                      0%

                                      0%

                                      0%
                        Steer Tires (Crr kg/metric ton)
Baseline
                                      40%
                                      30%
                                      40%
                                      30%
                                      30%
                                      30%
                                      10%
Bin I
                                      50%
                                      60%
                                      50%
                                      60%
                                      60%
                                      60%
                                      70%
Bin II
                                      10%
                                      10%
                                      10%
                                      10%
                                      10%
                                      10%
                                      20%
                        Drive Tires (Crr kg/metric ton)
Baseline
                                      40%
                                      30%
                                      40%
                                      30%
                                      30%
                                      30%
                                      10%
Bin I
                                      50%
                                      60%
                                      50%
                                      60%
                                      60%
                                      60%
                                      70%
Bin II
                                      10%
                                      10%
                                      10%
                                      10%
                                      10%
                                      10%
                                      20%
                             Weight Reduction (lb)
400 lb. Weight Reduction
                                     100%
                                     100%
                                     100%
                                     100%
                                     100%
                                     100%
                                     100%
             Extended Idle Reduction (gram CO2/ton-mile reduction)
AES
                                      N/A
                                      N/A
                                      N/A
                                      N/A
                                     100%
                                     100%
                                     100%
                             Vehicle Speed Limiter
VSL
                                      0%
                                      0%
                                      0%
                                      0%
                                      0%
                                      0%
                                      0%
 Derivation of the Final Tractor Standards
The agencies used the technology inputs and final technology application rates in GEM to develop the final fuel consumption and CO2 emissions standards for each subcategory of Class 7 and 8 combination tractors.  The agencies derived a scenario truck for each subcategory by weighting the individual GEM input parameters included in Table III-3 by the application rates in Table III-4.  For example, the Cd value for a Class 8 Sleeper Cab High Roof scenario case was derived as 10 percent times 0.68 plus 70 percent times 0.60 plus 20 percent times 0.55, which is equal to a Cd of 0.60.  Similar calculations were done for tire rolling resistance, weight reduction, idle reduction, and vehicle speed limiters.  To account for the two final engine standards, the agencies assumed a compliant engine in GEM.  In other words, EPA is finalizing the use of a 2014 model year fuel consumption map in GEM to derive the 2014 model year tractor standard and a 2017 model year fuel consumption map to derive the 2017 model year tractor standard.  The agencies then ran GEM with a single set of vehicle inputs, as shown in Table III-5, to derive the final standards for each subcategory.  Additional detail is provided in the RIA Chapter 2.
Table III-5: GEM Inputs for the Class 7 and 8 Tractor Standard Setting

                                    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
Aerodynamics (Cd)
                                   0.73/0.84
                                     0.63
                                   0.73/0.84
                                     0.63
                                     0.73
                                     0.83
                                     0.57
Steer Tire CRR (kg/metric ton)
                                     6.99
                                     6.87
                                     6.99
                                     6.87
                                     6.87
                                     6.87
                                     6.54
Drive Tire CRR (kg/metric ton)
                                     7.38
                                     7.26
                                     7.38
                                     7.26
                                     7.26
                                     7.26
                                     6.92
Weight Reduction (lb)
                                      400
                                      400
                                      400
                                      400
                                      400
                                      400
                                      400
Extended Idle Reduction (g/ton-mile)
                                      --
                                      --
                                      --
                                      --
                                       5
                                       5
                                       5
Vehicle Speed Limiter
                                      --
                                      --
                                      --
                                      --
                                      --
                                      --
                                      --
                            2014 MY Final Standard
Engine
                                  2014 MY 11L
                                  2014 MY 11L
                                  2014 MY 15L
                                  2014 MY 15L
                                  2014 MY 15L
                                 2014 MY 15L
                                 2014 MY 15L
                            2017 MY Final Standard
Engine
                                  2017 MY 11L
                                 2017 MY  11L
                                  2017 MY 15L
                                  2017 MY 15L
                                  2017 MY 15L
                                  2017 MY 15L
                                  2017 MY 15L
The level of the 2014 and 2017 model year final standards and percent reduction from the baseline for each subcategory are included in Table III-6.
Table III-6: Final 2014 and 2017 Model Year Tractor Reductions
2014 Model Year CO2 Grams per Ton-Mile

Day Cab
Sleeper Cab

Class 7
Class 8
Class 8
Low Roof
107
81
68
Mid Roof
119
88
75
High Roof
122
90
73
2014-2016 Model Year Gallons of Fuel per 1,000 Ton-Mile

Day Cab
Sleeper Cab

Class 7
Class 8
Class 8
Low Roof
10.5
8.0
6.6
Mid Roof
11.6
8.7
7.4
High Roof
12.0
8.9
7.2
2017 Model Year CO2 Grams per Ton-Mile

Day Cab
Sleeper Cab

Class 7
Class 8
Class 8
Low Roof
104
79
66
Mid Roof
115
86
73
High Roof
118
88
71
2017 Model Year and Later Gallons of Fuel per 1,000 Ton-Mile

Day Cab
Sleeper Cab

Class 7
Class 8
Class 8
Low Roof
10.3
7.8
6.5
Mid Roof
11.3
8.4
7.2
High Roof
11.6
8.6
7.0

A summary of the final technology package costs is included in Table III-7 with additional details available in the RIA Chapter 2.

Table III-7:  Class 7 and 8 Tractor Technology Costs inclusive of Indirect Cost Markups in the 2014 Model Year[a] (2009$)

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
Aerodynamics
$675
$924
$675
$924
$962
$983
$1,627

Steer Tires
$68
$68
$68
$68
$68
$68
$68

Drive Tires
$63
$63
$126
$126
$126
$126
$126

Weight Reduction
$1,536
$1,536
$1,980
$1,980
$3,275
$3,275
$1,980

Auxiliary Power Unit
--
--
--
--
$3,819
$3,819
$3,819

Air Conditioning
$22
$22
$22
$22
$22
$22
$22

Total
$2,364
$2,612
$2,871
$3,119
$8,271
$8,291
$7,641
Notes:
[a] Costs shown are for the 2014 model year so do not reflect learning impacts which would result in lower costs for later model years.  For a description of the learning impacts considered in this analysis and how it impacts technology costs for other years, refer to Chapter 2 of the RIA (see RIA 2.2.2).
[b] Note that values in this table include penetration rates.  Therefore, the technology costs shown reflect the average cost expected for each of the indicated classes.  To see the actual estimated technology costs exclusive of penetration rates, refer to Chapter 2 of the RIA (see RIA 2.9).
Reasonableness of the Final Standards
The final standards are based on aggressive application rates for control technologies which 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) above; see also RIA Chapter <IP_ADDRESS>.  These technologies, at the estimated application rates, are available within the lead time provided, as discussed in RIA Chapter 2.5.  Use of these technologies would add only a small amount to the cost of the vehicle, and the associated reductions are highly cost effective, an estimated $20 per ton of CO2eq per vehicle in 2030 without consideration of the substantial fuel savings.  This is even more cost effective than the estimated cost effectiveness for CO2eq removal and fuel economy improvements under the light-duty vehicle rule, already considered by the agencies to be a highly cost effective reduction.  Moreover, the cost of controls is rapidly recovered due to the associated fuel savings, as shown in the payback analysis included in Table VIII-8 located in Section VIII below. Thus, overall cost per ton of the rule, considering fuel savings, is negative  -  fuel savings associated with the rule more than offset projected costs by a wide margin.  See Table VIII-5 in Section VIII below.  Given that the standards are technically feasible within the lead time afforded by the 2014 model year, are inexpensive and highly cost effective even without 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), the final standards represent a reasonable choice under section 202(a) of the CAA and under NHTSA's EISA authority at 49 U.S.C. 32902(k)(2).
Alternative Tractor Standards Considered
The agencies are not adopting tractor standards less stringent than the proposed standards because the agencies believe these standards are appropriate, highly cost effective, and technologically feasible within the rulemaking time frame.
The agencies considered adopting tractor standards which are more stringent than those proposed reflecting increased application rates of the technologies discussed.  We also considered setting more stringent standards based on the inclusion of hybrid powertrains in tractors.  We stopped short of finalizing more stringent standards based on higher application rates of improved aerodynamic controls and tire rolling resistance because we concluded that the technologies would not be compatible with the use profile of a subset of tractors which operate in off-road conditions.  We have not adopted more stringent standards for tractors based on the use of hybrid vehicle technologies, believing that additional development and therefore lead-time is needed to develop hybrid systems and battery technology for tractors that operate primarily in highway cruise operations.  We know, for example, that hybrid systems are being researched to capture and return energy for tractors that operate in gently rolling hills.  However, it is not clear to us today that these systems will be generally applicable to tractors in the timeframe of this regulation.  In addition, even if hybrid technologies were generally available for these tractors during the MY 2014-2017 period, their costs would be extremely high and benefits would be limited given that idle reduction controls already capture many of the same emissions.
Tractor Engines
Baseline Engine Performance
As noted above, EPA and NHTSA developed the baseline medium and heavy heavy-duty diesel engine to represent a 2010 model year engine compliant with the 0.20 g/bhp-hr NOX standard for on-highway heavy-duty engines.