Stabilization Targets. Committee on Stabilization Targets for
Atmospheric Greenhouse Gas Concentrations; Board on Atmospheric
Sciences and Climate, Division of Earth and Life Sciences, National
Academy Press. Washington, DC.
---------------------------------------------------------------------------

    EPA's analysis of the proposal's impact on global climate
conditions is intended to quantify these potential reductions using the
best available science. While EPA's modeling results of the effect of
this proposal alone show small differences in climate effects
(CO2 concentration, temperature, sea-level rise, ocean pH),
when expressed in terms of global climate endpoints and global GHG
emissions, yield results that are repeatable and consistent within the
modeling frameworks used.

VII. How Would This Proposal Impact Non-GHG Emissions and Their
Associated Effects?

A. Emissions Inventory Impacts

(1) Upstream Impacts of the Program
    Increasing efficiency in heavy-duty vehicles would result in
reduced fuel demand and therefore reductions in the emissions
associated with all processes involved in getting petroleum to the
pump. These projected upstream emission impacts on criteria pollutants
are summarized in Table VII-1. Table VII-2 shows the corresponding
projected impacts on upstream air toxic emissions in 2030.

[GRAPHIC] [TIFF OMITTED] TP30NO10.055

    To project these impacts, EPA estimated the impact of reduced
petroleum volumes on the extraction and transportation of crude oil as
well as the production and distribution of finished gasoline and
diesel. For the purpose of assessing domestic-only emission reductions
it was necessary to estimate the fraction of fuel savings attributable
to domestic finished gasoline and diesel, and of this fuel what
fraction is produced from domestic crude. For this analysis EPA
estimated that 50 percent of fuel savings is attributable to domestic
finished gasoline and diesel and that 90 percent of this gasoline and
diesel originated from imported crude. Emission factors for most
upstream emission sources are based on the GREET1.8 model, developed by
DOE's Argonne National Laboratory but in some cases the GREET values
were modified or updated by EPA to be consistent with the National
Emission Inventory. These updates are consistent with those used for
the upstream analysis included in the Light-Duty GHG rulemaking. More
information on the development of the emission factors used in this
analysis can be found in draft RIA Chapter 5.
(2) Downstream Impacts of the Program
    While these proposed rules do not regulate non-GHG pollutants, EPA
expects reductions in downstream emissions of most non-GHG pollutants.
These pollutants include NOX, SO2, CO, and HC.
The primary reason for this is the improvements in road load
(aerodynamics and tire rolling resistance) under the proposal. Another
reason is that emissions from certain pollutants (e.g., SO2)
are proportional to fuel consumption. For vehicle types not affected by
road load improvements, non-GHG emissions may increase very slightly
due to VMT rebound. EPA also anticipates the use of APUs in combination
tractors for GHG reduction purposes during extended idling. These units
exhibit different non-GHG emissions characteristics compared to the on-
road engines they would replace during extended idling. EPA used MOVES
to determine non-GHG emissions inventories for baseline and control
cases. Further information about the MOVES analysis is available in
Section VI and RIA Chapter 5. The improvements in road load, use of
APUs, and VMT rebound were included in the MOVES runs and post-
processing. Table VII-3 summarizes the downstream criteria pollutant
impacts of this proposal. Most of the impacts shown are through
projected increased APU use. Because APUs are required to meet much
less stringent PM2.5 standards than on-road engines, the
projected widespread use of APUs leads to higher PM2.5.
Table VII-4 summarizes the downstream air toxics impacts of this
proposal.

[GRAPHIC] [TIFF OMITTED] TP30NO10.056

(3) Total Impacts of the Program
    As shown in Table VII-5 and Table VII-6, the agencies estimate that
this program would result in reductions of NOX, VOC, CO,
SOX, and air toxics. For NOX, VOC, and CO, much
of the net reductions are realized through the use of APUs, which emit
these pollutants at a lower rate than on-road engines during extended
idle operation. Additional reductions are achieved in all pollutants
through reduced road load (improved aerodynamics and tire rolling
resistance), which reduces the amount of work required to travel a
given distance. For SOX, downstream emissions are roughly
proportional to fuel consumption; therefore a decrease is seen in both
upstream and downstream sources. The downstream increase in
PM2.5 due to APU use is mostly negated by upstream
PM2.5 reductions, though our calculations show a slight net
increase in 2030 and 2050.\242\
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    \242\ Although the net impact is small when aggregated to the
national level, it is unlikely that the geographic location of
increases in downstream PM2.5 emissions will coincide
with the location of decreases in upstream PM2.5
emissions. Impacts of the emissions changes will be included in the
air quality modeling that will be completed for the final
rulemaking.
[GRAPHIC] [TIFF OMITTED] TP30NO10.057

B. Health Effects of Non-GHG Pollutants

    In this section we discuss health effects associated with exposure
to some of the criteria and air toxic pollutants impacted by the
proposed heavy-duty vehicle standards.
(1) Particulate Matter
(a) Background
    Particulate matter is a generic term for a broad class of
chemically and physically diverse substances. It can be principally
characterized as discrete particles that exist in the condensed (liquid
or solid) phase spanning several orders of magnitude in size. Since
1987, EPA has delineated that subset of inhalable particles small
enough to penetrate to the thoracic region (including the
tracheobronchial and alveolar regions) of the respiratory tract
(referred to as thoracic particles). Current National Ambient Air
Quality Standards (NAAQS) use PM2.5 as the indicator for
fine particles (with PM2.5 referring to particles with a
nominal mean aerodynamic diameter less than or equal to 2.5 [mu]m), and
use PM10 as the indicator for purposes of regulating the
coarse fraction of PM10 (referred to as thoracic coarse
particles or coarse-fraction particles; generally including particles
with a nominal mean aerodynamic diameter greater than 2.5 [mu]m and
less than or equal to 10 [mu]m, or PM10-2.5). Ultrafine
particles are a subset of fine particles, generally less than 100
nanometers (0.1 [mu]m) in aerodynamic diameter.
    Fine particles are produced primarily by combustion processes and
by transformations of gaseous emissions (e.g., SOX,
NOX, and VOC) in the atmosphere. The chemical and physical
properties of PM2.5 may vary greatly with time, region,
meteorology, and source category. Thus, PM2.5 may include a
complex mixture of different pollutants including sulfates, nitrates,
organic compounds, elemental carbon and metal compounds. These
particles can remain in the atmosphere for days to weeks and travel
hundreds to thousands of kilometers.
(b) Health Effects of PM
    Scientific studies show ambient PM is associated with a series of
adverse health effects. These health effects are discussed in detail in
EPA's Integrated Science Assessment for Particulate Matter (ISA).\243\
Further discussion of health effects associated with PM can also be
found in the draft RIA for this proposal. The ISA summarizes evidence
associated with PM2.5, PM10-2.5, and ultrafine
particles.
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    \243\ U.S. EPA (2009) Integrated Science Assessment for
Particulate Matter (Final Report). U.S. Environmental Protection
Agency, Washington, DC, EPA/600/R-08/139F, Docket EPA-HQ-OAR-2010-
0162.
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    The ISA concludes that health effects associated with short-term
exposures (hours to days) to ambient PM2.5 include
mortality, cardiovascular effects, such as altered vasomotor function
and hospital admissions and emergency department visits for ischemic
heart disease and congestive heart failure, and respiratory effects,
such as exacerbation of asthma symptoms in children and hospital
admissions and emergency department visits for chronic obstructive
pulmonary disease and respiratory infections.\244\ The ISA notes that
long-term exposure to PM2.5 (months to years) is associated
with the development/progression of cardiovascular disease, premature
mortality, and respiratory effects, including reduced lung function
growth, increased respiratory symptoms, and asthma development.\245\
The ISA concludes that the currently available scientific evidence from
epidemiologic, controlled human exposure, and toxicological studies
supports a causal association between short- and long-term exposures to
PM2.5 and cardiovascular effects and mortality. Furthermore,
the ISA concludes that the collective evidence supports likely causal
associations between short- and long-term PM2.5 exposures and
respiratory effects. The ISA also concludes that the scientific
evidence is suggestive of a causal association for reproductive and
developmental effects and cancer, mutagenicity, and genotoxicity and
long-term exposure to PM2.5.\246\
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    \244\ See U.S. EPA, 2009 Final PM ISA, Note 243, at Section
<IP_ADDRESS>.
    \245\ See U.S. EPA 2009 Final PM ISA, Note 243, at page 2-12,
Sections <IP_ADDRESS> and <IP_ADDRESS>.
    \246\ See U.S. EPA 2009 Final PM ISA, Note 243, at Section
2.3.2.
---------------------------------------------------------------------------

    For PM10-2.5, the ISA concludes that the current
evidence is suggestive of a causal relationship between short-term
exposures and cardiovascular effects, such as hospitalization for
ischemic heart disease. There is also suggestive evidence of a causal
relationship between short-term PM10-2.5 exposure and
mortality and respiratory effects. Data are inadequate to draw
conclusions regarding the health effects associated with long-term
exposure to PM10-2.5.\247\
---------------------------------------------------------------------------

    \247\ See U.S. EPA 2009 Final PM ISA, Note 243, at Section
2.3.4, Table 2-6.
---------------------------------------------------------------------------

    For ultrafine particles, the ISA concludes that there is suggestive
evidence of a causal relationship between short-term exposures and
cardiovascular effects, such as changes in heart rhythm and blood
vessel function. It also concludes that there is suggestive evidence of
association between short-term exposure to ultrafine particles and
respiratory effects. Data are inadequate to draw conclusions regarding
the health effects associated with long-term exposure to ultrafine
particles.\248\
---------------------------------------------------------------------------

    \248\ See U.S. EPA 2009 Final PM ISA, Note 243, at Section
2.3.5, Table 2-6.
---------------------------------------------------------------------------

(2) Ozone
(a) Background
    Ground-level ozone pollution is typically formed by the reaction of
VOC and NOX in the lower atmosphere in the presence of
sunlight. These pollutants, often referred to as ozone precursors, are
emitted by many types of pollution sources, such as highway and nonroad
motor vehicles and engines, power plants, chemical plants, refineries,
makers of consumer and commercial products, industrial facilities, and
smaller area sources.
    The science of ozone formation, transport, and accumulation is
complex. Ground-level ozone is produced and destroyed in a cyclical set
of chemical reactions, many of which are sensitive to temperature and
sunlight. When ambient temperatures and sunlight levels remain high for
several days and the air is relatively stagnant, ozone and its
precursors can build up and result in more ozone than typically occurs
on a single high-temperature day. Ozone can be transported hundreds of
miles downwind from precursor emissions, resulting in elevated ozone
levels even in areas with low local VOC or NOX emissions.
(b) Health Effects of Ozone
    The health and welfare effects of ozone are well documented and are
assessed in EPA's 2006 Air Quality Criteria Document and 2007 Staff
Paper.249 250 People who are more susceptible to effects
associated with exposure to ozone can include children, the elderly,
and individuals with respiratory disease such as asthma. Those with
greater exposures to ozone, for instance due to time spent outdoors
(e.g., children and outdoor workers), are of particular concern. Ozone
can irritate the respiratory system, causing coughing, throat
irritation, and breathing discomfort. Ozone can reduce

lung function and cause pulmonary inflammation in healthy individuals.
Ozone can also aggravate asthma, leading to more asthma attacks that
require medical attention and/or the use of additional medication.
Thus, ambient ozone may cause both healthy and asthmatic individuals to
limit their outdoor activities. In addition, there is suggestive
evidence of a contribution of ozone to cardiovascular-related morbidity
and highly suggestive evidence that short-term ozone exposure directly
or indirectly contributes to non-accidental and cardiopulmonary-related
mortality, but additional research is needed to clarify the underlying
mechanisms causing these effects. In a recent report on the estimation
of ozone-related premature mortality published by NRC, a panel of
experts and reviewers concluded that short-term exposure to ambient
ozone is likely to contribute to premature deaths and that ozone-
related mortality should be included in estimates of the health
benefits of reducing ozone exposure.\251\ Animal toxicological evidence
indicates that with repeated exposure, ozone can inflame and damage the
lining of the lungs, which may lead to permanent changes in lung tissue
and irreversible reductions in lung function. The respiratory effects
observed in controlled human exposure studies and animal studies are
coherent with the evidence from epidemiologic studies supporting a
causal relationship between acute ambient ozone exposures and increased
respiratory-related emergency room visits and hospitalizations in the
warm season. In addition, there is suggestive evidence of a
contribution of ozone to cardiovascular-related morbidity and non-
accidental and cardiopulmonary mortality.
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    \249\ U.S. EPA. (2006). Air Quality Criteria for Ozone and
Related Photochemical Oxidants (Final). EPA/600/R-05/004aF-cF.
Washington, DC: U.S. EPA. Docket EPA-HQ-OAR-2010-0162.
    \250\ U.S. EPA. (2007). Review of the National Ambient Air
Quality Standards for Ozone: Policy Assessment of Scientific and
Technical Information, OAQPS Staff Paper. EPA-452/R-07-003.
Washington, DC, U.S. EPA. Docket EPA-HQ-OAR-2010-0162.
    \251\ National Research Council (NRC), 2008. Estimating
Mortality Risk Reduction and Economic Benefits from Controlling
Ozone Air Pollution. The National Academies Press: Washington, DC
Docket EPA-HQ-OAR-2010-0162
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(3) Nitrogen Oxides and Sulfur Oxides
(a) Background
    Nitrogen dioxide (NO2) is a member of the NOX
family of gases. Most NO2 is formed in the air through the
oxidation of nitric oxide (NO) emitted when fuel is burned at a high
temperature. SO2, a member of the sulfur oxide
(SOX) family of gases, is formed from burning fuels
containing sulfur (e.g., coal or oil derived), extracting gasoline from
oil, or extracting metals from ore.
    SO2 and NO2 can dissolve in water droplets
and further oxidize to form sulfuric and nitric acid which react with
ammonia to form sulfates and nitrates, both of which are important
components of ambient PM. The health effects of ambient PM are
discussed in Section VII. B. (1) (b) of this preamble. NOX
and NMHC are the two major precursors of ozone. The health effects of
ozone are covered in Section VII. B. (2)(b).
(b) Health Effects of NO2
    Information on the health effects of NO2 can be found in
the EPA Integrated Science Assessment (ISA) for Nitrogen Oxides.\252\
The EPA has concluded that the findings of epidemiologic, controlled
human exposure, and animal toxicological studies provide evidence that
is sufficient to infer a likely causal relationship between respiratory
effects and short-term NO2 exposure. The ISA concludes that
the strongest evidence for such a relationship comes from epidemiologic
studies of respiratory effects including symptoms, emergency department
visits, and hospital admissions. The ISA also draws two broad
conclusions regarding airway responsiveness following NO2
exposure. First, the ISA concludes that NO2 exposure may
enhance the sensitivity to allergen-induced decrements in lung function
and increase the allergen-induced airway inflammatory response
following 30-minute exposures of asthmatics to NO2
concentrations as low as 0.26 ppm. In addition, small but significant
increases in non-specific airway hyperresponsiveness were reported
following 1-hour exposures of asthmatics to 0.1 ppm NO2.
Second, exposure to NO2 has been found to enhance the
inherent responsiveness of the airway to subsequent nonspecific
challenges in controlled human exposure studies of asthmatic subjects.
Enhanced airway responsiveness could have important clinical
implications for asthmatics since transient increases in airway
responsiveness following NO2 exposure have the potential to
increase symptoms and worsen asthma control. Together, the
epidemiologic and experimental data sets form a plausible, consistent,
and coherent description of a relationship between NO2
exposures and an array of adverse health effects that range from the
onset of respiratory symptoms to hospital admission.
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    \252\ U.S. EPA (2008). Integrated Science Assessment for Oxides
of Nitrogen--Health Criteria (Final Report). EPA/600/R-08/071.
Washington, DC: U.S.EPA. Docket EPA-HQ-OAR-2010-0162 .
---------------------------------------------------------------------------

    Although the weight of evidence supporting a causal relationship is
somewhat less certain than that associated with respiratory morbidity,
NO2 has also been linked to other health endpoints. These
include all-cause (nonaccidental) mortality, hospital admissions or
emergency department visits for cardiovascular disease, and decrements
in lung function growth associated with chronic exposure.
(c) Health Effects of SO2
    Information on the health effects of SO2 can be found in
the EPA Integrated Science Assessment for Sulfur Oxides.\253\
SO2 has long been known to cause adverse respiratory health
effects, particularly among individuals with asthma. Other potentially
sensitive groups include children and the elderly. During periods of
elevated ventilation, asthmatics may experience symptomatic
bronchoconstriction within minutes of exposure. Following an extensive
evaluation of health evidence from epidemiologic and laboratory
studies, the EPA has concluded that there is a causal relationship
between respiratory health effects and short-term exposure to
SO2. Separately, based on an evaluation of the epidemiologic
evidence of associations between short-term exposure to SO2
and mortality, the EPA has concluded that the overall evidence is
suggestive of a causal relationship between short-term exposure to
SO2 and mortality.
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    \253\ U.S. EPA. (2008). Integrated Science Assessment (ISA) for
Sulfur Oxides--Health Criteria (Final Report). EPA/600/R-08/047F.
Washington, DC: U.S. Environmental Protection Agency. Docket EPA-HQ-
OAR-2010-0162.
---------------------------------------------------------------------------

(4) Carbon Monoxide
    Information on the health effects of CO can be found in the EPA
Integrated Science Assessment (ISA) for Carbon Monoxide.\254\ The ISA
concludes that ambient concentrations of CO are associated with a
number of adverse health effects.\255\ This section provides a summary
of the health effects associated with exposure to ambient
concentrations of CO.\256\
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    \254\ U.S. EPA, 2010. Integrated Science Assessment for Carbon
Monoxide (Final Report). U.S. Environmental Protection Agency,
Washington, DC, EPA/600/R-09/019F, 2010. Available at http://
cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=218686. Docket EPA-HQ-
OAR-2010-0162.
    \255\ The ISA evaluates the health evidence associated with
different health effects, assigning one of five ``weight of
evidence'' determinations: causal relationship, likely to be a
causal relationship, suggestive of a causal relationship, inadequate
to infer a causal relationship, and not likely to be a causal
relationship. For definitions of these levels of evidence, please
refer to Section 1.6 of the ISA.
    \256\ Personal exposure includes contributions from many
sources, and in many different environments. Total personal exposure
to CO includes both ambient and nonambient components; and both
components may contribute to adverse health effects.

---------------------------------------------------------------------------

    Human clinical studies of subjects with coronary artery disease
show a decrease in the time to onset of exercise-induced angina (chest
pain) and electrocardiogram changes following CO exposure. In addition,
epidemiologic studies show associations between short-term CO exposure
and cardiovascular morbidity, particularly increased emergency room
visits and hospital admissions for coronary heart disease (including
ischemic heart disease, myocardial infarction, and angina). Some
epidemiologic evidence is also available for increased hospital
admissions and emergency room visits for congestive heart failure and
cardiovascular disease as a whole. The ISA concludes that a causal
relationship is likely to exist between short-term exposures to CO and
cardiovascular morbidity. It also concludes that available data are
inadequate to conclude that a causal relationship exists between long-
term exposures to CO and cardiovascular morbidity.
    Animal studies show various neurological effects with in-utero CO
exposure. Controlled human exposure studies report inconsistent neural
and behavioral effects following low-level CO exposures. The ISA
concludes the evidence is suggestive of a causal relationship with both
short- and long-term exposure to CO and central nervous system effects.
    A number of epidemiologic and animal toxicological studies cited in
the ISA have evaluated associations between CO exposure and birth
outcomes such as preterm birth or cardiac birth defects. The
epidemiologic studies provide limited evidence of a CO-induced effect
on preterm births and birth defects, with weak evidence for a decrease
in birth weight. Animal toxicological studies have found associations
between perinatal CO exposure and decrements in birth weight, as well
as other developmental outcomes. The ISA concludes these studies are
suggestive of a causal relationship between long-term exposures to CO
and developmental effects and birth outcomes.
    Epidemiologic studies provide evidence of effects on respiratory
morbidity such as changes in pulmonary function, respiratory symptoms,
and hospital admissions associated with ambient CO concentrations. A
limited number of epidemiologic studies considered copollutants such as
ozone, SO2, and PM in two-pollutant models and found that CO
risk estimates were generally robust, although this limited evidence
makes it difficult to disentangle effects attributed to CO itself from
those of the larger complex air pollution mixture. Controlled human
exposure studies have not extensively evaluated the effect of CO on
respiratory morbidity. Animal studies at levels of 50-100 ppm CO show
preliminary evidence of altered pulmonary vascular remodeling and
oxidative injury. The ISA concludes that the evidence is suggestive of
a causal relationship between short-term CO exposure and respiratory
morbidity, and inadequate to conclude that a causal relationship exists
between long-term exposure and respiratory morbidity.
    Finally, the ISA concludes that the epidemiologic evidence is
suggestive of a causal relationship between short-term exposures to CO
and mortality. Epidemiologic studies provide evidence of an association
between short-term exposure to CO and mortality, but limited evidence
is available to evaluate cause-specific mortality outcomes associated
with CO exposure. In addition, the attenuation of CO risk estimates
which was often observed in copollutant models contributes to the
uncertainty as to whether CO is acting alone or as an indicator for
other combustion-related pollutants. The ISA also concludes that there
is not likely to be a causal relationship between relevant long-term
exposures to CO and mortality.
(5) Air Toxics
    Heavy-duty vehicle emissions contribute to ambient levels of air
toxics known or suspected as human or animal carcinogens, or that have
noncancer health effects. The population experiences an elevated risk
of cancer and other noncancer health effects from exposure to the class
of pollutants known collectively as ``air toxics.'' \257\ These
compounds include, but are not limited to, benzene, 1,3-butadiene,
formaldehyde, acetaldehyde, acrolein, diesel particulate matter and
exhaust organic gases, polycyclic organic matter, and naphthalene.
These compounds were identified as national or regional risk drivers in
past National-scale Air Toxics Assessments and have significant
inventory contributions from mobile sources.\258\
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    \257\ U.S. EPA. 2002 National-Scale Air Toxics Assessment.
http://www.epa.gov/ttn/atw/nata12002/risksum.html. Docket EPA-HQ-
OAR-2010-0162.
    \258\ U.S. EPA 2009. National-Scale Air Toxics Assessment for
2002. http://www.epa.gov/ttn/atw/nata2002/. Docket EPA-HQ-OAR-2010-
0162.
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(a) Diesel Exhaust
    Heavy-duty diesel engines emit diesel exhaust, a complex mixture
composed of carbon dioxide, oxygen, nitrogen, water vapor, carbon
monoxide, nitrogen compounds, sulfur compounds and numerous low-
molecular-weight hydrocarbons. A number of these gaseous hydrocarbon
components are individually known to be toxic, including aldehydes,
benzene and 1,3-butadiene. The diesel particulate matter present in
diesel exhaust consists of fine particles (< 2.5 [mu]m), including a
subgroup with a large number of ultrafine particles (< 0.1 [mu]m).
These particles have a large surface area which makes them an excellent
medium for adsorbing organics and their small size makes them highly
respirable. Many of the organic compounds present in the gases and on
the particles, such as polycyclic organic matter, are individually
known to have mutagenic and carcinogenic properties.
    Diesel exhaust varies significantly in chemical composition and
particle sizes between different engine types (heavy-duty, light-duty),
engine operating conditions (idle, accelerate, decelerate), and fuel
formulations (high/low sulfur fuel). Also, there are emissions
differences between on-road and nonroad engines because the nonroad
engines are generally of older technology. After being emitted in the
engine exhaust, diesel exhaust undergoes dilution as well as chemical
and physical changes in the atmosphere. The lifetime for some of the
compounds present in diesel exhaust ranges from hours to days.\259\
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    \259\ U.S. EPA (2002). Health Assessment Document for Diesel
Engine Exhaust. EPA/600/8-90/057F Office of Research and
Development, Washington DC. Retrieved on March 17, 2009 from http://
cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=29060. Docket EPA-HQ-
OAR-2010-0162.
---------------------------------------------------------------------------

(i) Diesel Exhaust: Potential Cancer Effects
    In EPA's 2002 Diesel Health Assessment Document (Diesel HAD),\260\
exposure to diesel exhaust was classified as likely to be carcinogenic
to humans by inhalation from environmental exposures, in accordance
with the revised draft 1996/1999 EPA cancer guidelines. A number of
other agencies (National Institute for Occupational Safety and Health,
the International Agency for Research on Cancer, the World Health
Organization, California EPA, and the U.S. Department of Health and
Human Services) have made similar classifications. However, EPA also
concluded in the Diesel HAD that it is not possible currently to
calculate a cancer unit risk for diesel exhaust due to a variety of
factors that limit the

current studies, such as limited quantitative exposure histories in
occupational groups investigated for lung cancer.
---------------------------------------------------------------------------

    \260\ See U.S. EPA (2002) Diesel HAD, Note 259, at pp. 1-1, 1-2.
---------------------------------------------------------------------------

    For the Diesel HAD, EPA reviewed 22 epidemiologic studies on the
subject of the carcinogenicity of workers exposed to diesel exhaust in
various occupations, finding increased lung cancer risk, although not
always statistically significant, in 8 out of 10 cohort studies and 10
out of 12 case-control studies within several industries. Relative risk
for lung cancer associated with exposure ranged from 1.2 to 1.5,
although a few studies show relative risks as high as 2.6.
Additionally, the Diesel HAD also relied on two independent meta-
analyses, which examined 23 and 30 occupational studies respectively,
which found statistically significant increases in smoking-adjusted
relative lung cancer risk associated with exposure to diesel exhaust of
1.33 to 1.47. These meta-analyses demonstrate the effect of pooling
many studies and in this case show the positive relationship between
diesel exhaust exposure and lung cancer across a variety of diesel
exhaust-exposed occupations.261 262
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    \261\ Bhatia, R., Lopipero, P., Smith, A. (1998). Diesel
exposure and lung cancer. Epidemiology, 9(1), 84-91. Docket EPA-HQ-
OAR-2010-0162.
    \262\ Lipsett, M. Campleman, S. (1999). Occupational exposure to
diesel exhaust and lung cancer: a meta-analysis. Am J Public Health,
80(7), 1009-1017. Docket EPA-HQ-OAR-2010-0162.
---------------------------------------------------------------------------

    In the absence of a cancer unit risk, the Diesel HAD sought to
provide additional insight into the significance of the diesel exhaust-
cancer hazard by estimating possible ranges of risk that might be
present in the population. An exploratory analysis was used to
characterize a possible risk range by comparing a typical environmental
exposure level for highway diesel sources to a selected range of
occupational exposure levels. The occupationally observed risks were
then proportionally scaled according to the exposure ratios to obtain
an estimate of the possible environmental risk. A number of
calculations are needed to accomplish this, and these can be seen in
the EPA Diesel HAD. The outcome was that environmental risks from
diesel exhaust exposure could range from a low of 10-4 to
10-5 to as high as 10-3, reflecting the range of
occupational exposures that could be associated with the relative and
absolute risk levels observed in the occupational studies. Because of
uncertainties, the analysis acknowledged that the risks could be lower
than 10-4 or 10-5, and a zero risk from diesel
exhaust exposure was not ruled out.
(ii) Diesel Exhaust: Other Health Effects
    Noncancer health effects of acute and chronic exposure to diesel
exhaust emissions are also of concern to the EPA. EPA derived a diesel
exhaust reference concentration (RfC) from consideration of four well-
conducted chronic rat inhalation studies showing adverse pulmonary
effects.263 264 265 266 The RfC is 5 [mu]g/m\3\ for diesel
exhaust as measured by diesel particulate matter. This RfC does not
consider allergenic effects such as those associated with asthma or
immunologic effects. There is growing evidence, discussed in the Diesel
HAD, that exposure to diesel exhaust can exacerbate these effects, but
the exposure-response data are presently lacking to derive an RfC. The
EPA Diesel HAD states, ``With [diesel particulate matter] being a
ubiquitous component of ambient PM, there is an uncertainty about the
adequacy of the existing [diesel exhaust] noncancer database to
identify all of the pertinent [diesel exhaust]-caused noncancer health
hazards.'' (p. 9-19). The Diesel HAD concludes ``that acute exposure to
[diesel exhaust] has been associated with irritation of the eye, nose,
and throat, respiratory symptoms (cough and phlegm), and
neurophysiological symptoms such as headache, lightheadedness, nausea,
vomiting, and numbness or tingling of the extremities.'' \267\
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    \263\ Ishinishi, N. Kuwabara, N. Takaki, Y., et al. (1988).
Long-term inhalation experiments on diesel exhaust. In: Diesel
exhaust and health risks. Results of the HERP studies. Ibaraki,
Japan: Research Committee for HERP Studies; pp. 11-84. Docket EPA-
HQ-OAR-2010-0162.
    \264\ Heinrich, U., Fuhst, R., Rittinghausen, S., et al. (1995).
Chronic inhalation exposure of Wistar rats and two different strains
of mice to diesel engine exhaust, carbon black, and titanium
dioxide. Inhal Toxicol, 7, 553-556. Docket EPA-HQ-OAR-2010-0162.
    \265\ Mauderly, J.L., Jones, R.K., Griffith, W.C., et al.
(1987). Diesel exhaust is a pulmonary carcinogen in rats exposed
chronically by inhalation. Fundam. Appl. Toxicol., 9, 208-221.
Docket EPA-HQ-OAR-2010-0162.
    \266\ Nikula, K.J., Snipes, M.B., Barr, E.B., et al. (1995).
Comparative pulmonary toxicities and carcinogenicities of
chronically inhaled diesel exhaust and carbon black in F344 rats.
Fundam. Appl. Toxicol, 25, 80-94. Docket EPA-HQ-OAR-2010-0162.
    \267\ See U.S. EPA (2002), Diesel HAD at Note 259, at p. 9-9.
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(iii) Ambient PM2.5 Levels and Exposure to Diesel Exhaust PM
    The Diesel HAD also briefly summarizes health effects associated
with ambient PM and discusses the EPA's annual PM2.5 NAAQS
of 15 [mu]g/m\3\. There is a much more extensive body of human data
showing a wide spectrum of adverse health effects associated with
exposure to ambient PM, of which diesel exhaust is an important
component. The PM2.5 NAAQS is designed to provide protection
from the noncancer and premature mortality effects of PM2.5
as a whole.
(iv) Diesel Exhaust PM Exposures
    Exposure of people to diesel exhaust depends on their various
activities, the time spent in those activities, the locations where
these activities occur, and the levels of diesel exhaust pollutants in
those locations. The major difference between ambient levels of diesel
particulate and exposure levels for diesel particulate is that exposure
accounts for a person moving from location to location, proximity to
the emission source, and whether the exposure occurs in an enclosed
environment.
Occupational Exposures
    Occupational exposures to diesel exhaust from mobile sources can be
several orders of magnitude greater than typical exposures in the non-
occupationally exposed population.
    Over the years, diesel particulate exposures have been measured for
a number of occupational groups. A wide range of exposures have been
reported, from 2 [mu]g/m\3\ to 1,280 [mu]g/m\3\, for a variety of
occupations. As discussed in the Diesel HAD, the National Institute of
Occupational Safety and Health has estimated a total of 1,400,000
workers are occupationally exposed to diesel exhaust from on-road and
nonroad vehicles.
Elevated Concentrations and Ambient Exposures in Mobile Source-Impacted
Areas
    Regions immediately downwind of highways or truck stops may
experience elevated ambient concentrations of directly-emitted
PM2.5 from diesel engines. Due to the unique nature of
highways and truck stops, emissions from a large number of diesel
engines are concentrated in a small area. Studies near roadways with
high truck traffic indicate higher concentrations of components of
diesel PM than other locations.268 269 270 High ambient
particle

concentrations have also been reported near trucking terminals, truck
stops, and bus garages.271 272 273 Additional discussion of
exposure and health effects associated with traffic is included below
in Section VII.B.(5)(j).
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    \268\ Zhu, Y.; Hinds, W.C.; Kim, S.; Shen, S.; Sioutas, C.
(2002). Study of ultrafine particles near a major highway with
heavy-duty diesel traffic. Atmospheric Environment 36: 4323-4335.
Docket EPA-HQ-OAR-2010-0162.
    \269\ Lena, T.S; Ochieng, V.; Holgu[iacute]n-Veras, J.; Kinney,
P.L. (2002). Elemental carbon and PM2.5 levels in an
urban community heavily impacted by truck traffic. Environ Health
Perspect 110: 1009-1015. Docket EPA-HQ-OAR-2010-0162.
    \270\ Soliman, A.S.M.; Jacko, J.B.; Palmer, G.M. (2006).
Development of an empirical model to estimate real-world fine
particulate matter emission factors: the Traffic Air Quality model.
J Air & Waste Manage Assoc 56: 1540-1549. Docket EPA-HQ-OAR-2010-
0162.
    \271\ Davis, M.E.; Smith, T.J.; Laden, F.; Hart, J.E.; Ryan,
L.M.; Garshick, E. (2006). Modeling particle exposure in U.S.
trucking terminals. Environ Sci Techol 40: 4226-4232. Docket EPA-HQ-
OAR-2010-0162.
    \272\ Miller, T.L.; Fu, J.S.; Hromis, B.; Storey, J.M. (2007).
Diesel truck idling emissions--measurements at a PM2.5 hot spot.
Proceedings of the Annual Conference of the Transportation Research
Board, paper no. 07-2609. Docket EPA-HQ-OAR-2010-0162.
    \273\ Ramachandran, G.; Paulsen, D.; Watts, W.; Kittelson, D.
(2005). Mass, surface area, and number metrics in diesel
occupational exposure assessment. J Environ Monit 7: 728-735. Docket
EPA-HQ-OAR-2010-0162.
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(b) Benzene
    The EPA's Integrated Risk Information System (IRIS) database lists
benzene as a known human carcinogen (causing leukemia) by all routes of
exposure, and concludes that exposure is associated with additional
health effects, including genetic changes in both humans and animals
and increased proliferation of bone marrow cells in
mice.274 275 276 EPA states in its IRIS database that data
indicate a causal relationship between benzene exposure and acute
lymphocytic leukemia and suggest a relationship between benzene
exposure and chronic non-lymphocytic leukemia and chronic lymphocytic
leukemia. The International Agency for Research on Carcinogens (IARC)
has determined that benzene is a human carcinogen and the U.S.
Department of Health and Human Services (DHHS) has characterized
benzene as a known human carcinogen.277 278
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    \274\ U.S. EPA. 2000. Integrated Risk Information System File
for Benzene. This material is available electronically at http://
www.epagov/iris/subst/0276.htm. Docket EPA-HQ-OAR-2010-0162.
    \275\ International Agency for Research on Cancer. 1982.
Monographs on the evaluation of carcinogenic risk of chemicals to
humans, Volume 29. Some industrial chemicals and dyestuffs, World
Health Organization, Lyon, France, p. 345-389. Docket EPA-HQ-OAR-
2010-0162.
    \276\ Irons, R.D.; Stillman, W.S.; Colagiovanni, D.B.; Henry,
V.A. 1992. Synergistic action of the benzene metabolite hydroquinone
on myelopoietic stimulating activity of granulocyte/macrophage
colony-stimulating factor in vitro, Proc. Natl. Acad. Sci. 89:3691-
3695. Docket EPA-HQ-OAR-2010-0162.
    \277\ See IARC, Note 275, above.
    \278\ U.S. Department of Health and Human Services National
Toxicology Program 11th Report on Carcinogens available at: http://
ntp.niehs.nih.gov/go/16183. Docket EPA-HQ-OAR-2010-0162.
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    A number of adverse noncancer health effects including blood
disorders, such as preleukemia and aplastic anemia, have also been
associated with long-term exposure to benzene.279 280 The
most sensitive noncancer effect observed in humans, based on current
data, is the depression of the absolute lymphocyte count in
blood.281 282 In addition, recent work, including studies
sponsored by the Health Effects Institute (HEI), provides evidence that
biochemical responses are occurring at lower levels of benzene exposure
than previously known.283 284 285 286 EPA's IRIS program has
not yet evaluated these new data.
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    \279\ Aksoy, M. (1989). Hematotoxicity and carcinogenicity of
benzene. Environ. Health Perspect. 82: 193-197. Docket EPA-HQ-OAR-
2010-0162.
    \280\ Goldstein, B.D. (1988). Benzene toxicity. Occupational
medicine. State of the Art Reviews. 3: 541-554. Docket EPA-HQ-OAR-
2010-0162.
    \281\ Rothman, N., G.L. Li, M. Dosemeci, W.E. Bechtold, G.E.
Marti, Y.Z. Wang, M. Linet, L.Q. Xi, W. Lu, M.T. Smith, N. Titenko-
Holland, L.P. Zhang, W. Blot, S.N. Yin, and R.B. Hayes (1996).
Hematotoxicity among Chinese workers heavily exposed to benzene. Am.
J. Ind. Med. 29: 236-246. Docket EPA-HQ-OAR-2010-0162.
    \282\ U.S. EPA (2002). Toxicological Review of Benzene
(Noncancer Effects). Environmental Protection Agency, Integrated
Risk Information System, Research and Development, National Center
for Environmental Assessment, Washington DC. This material is
available electronically at  http://www.epa.gov/iris/ubst/0276.htm.
Docket EPA-HQ-OAR-2010-0162.
    \283\ Qu, O.; Shore, R.; Li, G.; Jin, X.; Chen, C.L.; Cohen, B.;
Melikian, A.; Eastmond, D.; Rappaport, S.; Li, H.; Rupa, D.;
Suramaya, R.; Songnian, W.; Huifant, Y.; Meng, M.; Winnik, M.; Kwok,
E.; Li, Y.; Mu, R.; Xu, B.; Zhang, X.; Li, K. (2003). HEI Report
115, Validation & Evaluation of Biomarkers in Workers Exposed to
Benzene in China. Docket EPA-HQ-OAR-2010-0162.
    \284\ Qu, Q., R. Shore, G. Li, X. Jin, L.C. Chen, B. Cohen, et
al. (2002). Hematological changes among Chinese workers with a broad
range of benzene exposures. Am. J. Industr. Med. 42: 275-285. Docket
EPA-HQ-OAR-2010-0162.
    \285\ Lan, Qing, Zhang, L., Li, G., Vermeulen, R., et al.
(2004). Hematotoxically in Workers Exposed to Low Levels of Benzene.
Science 306: 1774-1776. Docket EPA-HQ-OAR-2010-0162.
    \286\ Turtletaub, K.W. and Mani, C. (2003). Benzene metabolism
in rodents at doses relevant to human exposure from Urban Air.
Research Reports Health Effect Inst. Report No.113. Docket EPA-HQ-
OAR-2010-0162.
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(c) 1,3-Butadiene
    EPA has characterized 1,3-butadiene as carcinogenic to humans by
inhalation.287 288 The IARC has determined that 1,3-
butadiene is a human carcinogen and the U.S. DHHS has characterized
1,3-butadiene as a known human carcinogen.289 290 There are
numerous studies consistently demonstrating that 1,3-butadiene is
metabolized into genotoxic metabolites by experimental animals and
humans. The specific mechanisms of 1,3-butadiene-induced carcinogenesis
are unknown; however, the scientific evidence strongly suggests that
the carcinogenic effects are mediated by genotoxic metabolites. Animal
data suggest that females may be more sensitive than males for cancer
effects associated with 1,3-butadiene exposure; there are insufficient
data in humans from which to draw conclusions about sensitive
subpopulations. 1,3-butadiene also causes a variety of reproductive and
developmental effects in mice; no human data on these effects are
available. The most sensitive effect was ovarian atrophy observed in a
lifetime bioassay of female mice.\291\
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    \287\ U.S. EPA (2002). Health Assessment of 1,3-Butadiene.
Office of Research and Development, National Center for
Environmental Assessment, Washington Office, Washington, DC. Report
No. EPA600-P-98-001F. This document is available electronically at
http://www.epa.gov/iris/supdocs/buta-sup.pdf. Docket EPA-HQ-OAR-
2010-0162.
    \288\ U.S. EPA (2002). Full IRIS Summary for 1,3-butadiene
(CASRN 106-99-0). Environmental Protection Agency, Integrated Risk
Information System (IRIS), Research and Development, National Center
for Environmental Assessment, Washington, DC http://www.epa.gov/
iris/subst/0139.htm. Docket EPA-HQ-OAR-2010-0162.
    \289\ International Agency for Research on Cancer (1999).
Monographs on the evaluation of carcinogenic risk of chemicals to
humans, Volume 71, Re-evaluation of some organic chemicals,
hydrazine and hydrogen peroxide and Volume 97 (in preparation),
World Health Organization, Lyon, France. Docket EPA-HQ-OAR-2010-
0162.
    \290\ U.S. Department of Health and Human Services (2005).
National Toxicology Program 11th Report on Carcinogens available at:
ntp.niehs.nih.gov/index.cfm?objectid=32BA9724-F1F6-975E-
7FCE50709CB4C932. Docket EPA-HQ-OAR-2010-0162.
    \291\ Bevan, C.; Stadler, J.C.; Elliot, G.S.; et al. (1996).
Subchronic toxicity of 4-vinylcyclohexene in rats and mice by
inhalation. Fundam. Appl. Toxicol. 32:1-10. Docket EPA-HQ-OAR-2010-
0162.
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(d) Formaldehyde
    Since 1987, EPA has classified formaldehyde as a probable human
carcinogen based on evidence in humans and in rats, mice, hamsters, and
monkeys.\292\ EPA is currently reviewing recently published
epidemiological data. For instance, research conducted by the National
Cancer Institute found an increased risk of nasopharyngeal cancer and
lymphohematopoietic malignancies such as leukemia among workers exposed
to formaldehyde.293 294

In an analysis of the lymphohematopoietic cancer mortality from an
extended follow-up of these workers, the National Cancer Institute
confirmed an association between lymphohematopoietic cancer risk and
peak exposures.\295\ A recent National Institute of Occupational Safety
and Health study of garment workers also found increased risk of death
due to leukemia among workers exposed to formaldehyde.\296\ Extended
follow-up of a cohort of British chemical workers did not find evidence
of an increase in nasopharyngeal or lymphohematopoietic cancers, but a
continuing statistically significant excess in lung cancers was
reported.\297\ Recently, the IARC re-classified formaldehyde as a human
carcinogen (Group 1).\298\
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    \292\ U.S. EPA (1987). Assessment of Health Risks to Garment
Workers and Certain Home Residents from Exposure to Formaldehyde,
Office of Pesticides and Toxic Substances, April 1987. Docket EPA-
HQ-OAR-2010-0162.
    \293\ Hauptmann, M.; Lubin, J. H.; Stewart, P.A.; Hayes, R.B.;
Blair, A. 2003. Mortality from lymphohematopoetic malignancies among
workers in formaldehyde industries. Journal of the National Cancer
Institute 95: 1615-1623. Docket EPA-HQ-OAR-2010-0162.
    \294\ Hauptmann, M.; Lubin, J.H.; Stewart, P.A.; Hayes, R.B.;
Blair, A. 2004. Mortality from solid cancers among workers in
formaldehyde industries. American Journal of Epidemiology 159: 1117-
1130. Docket EPA-HQ-OAR-2010-0162.
    \295\ Beane Freeman, L.E.; Blair, A.; Lubin, J.H.; Stewart,
P.A.; Hayes, R.B.; Hoover, R.N.; Hauptmann, M. 2009. Mortality from
lymphohematopoietic malignancies among workers in formaldehyde
industries: The National Cancer Institute cohort. J. National Cancer
Inst. 101: 751-761. Docket EPA-HQ-OAR-2010-0162.
    \296\ Pinkerton, L.E. 2004. Mortality among a cohort of garment
workers exposed to formaldehyde: an update. Occup. Environ. Med. 61:
193-200. Docket EPA-HQ-OAR-2010-0162.
    \297\ Coggon, D, EC Harris, J Poole, KT Palmer. 2003. Extended
follow-up of a cohort of British chemical workers exposed to
formaldehyde. J National Cancer Inst. 95:1608-1615. Docket EPA-HQ-
OAR-2010-0162.
    \298\ International Agency for Research on Cancer. 2006.
Formaldehyde, 2-Butoxyethanol and 1-tert-Butoxypropan-2-ol. Volume
88. (in preparation), World Health Organization, Lyon, France.
Docket EPA-HQ-OAR-2010-0162.
---------------------------------------------------------------------------

    Formaldehyde exposure also causes a range of noncancer health
effects, including irritation of the eyes (burning and watering of the
eyes), nose and throat. Effects from repeated exposure in humans
include respiratory tract irritation, chronic bronchitis and nasal
epithelial lesions such as metaplasia and loss of cilia. Animal studies
suggest that formaldehyde may also cause airway inflammation--including
eosinophil infiltration into the airways. There are several studies
that suggest that formaldehyde may increase the risk of asthma--
particularly in the young.299 300
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    \299\ Agency for Toxic Substances and Disease Registry (ATSDR).
1999. Toxicological profile for Formaldehyde. Atlanta, GA: U.S.
Department of Health and Human Services, Public Health Service.
http://ww.atsdr.cdc.gov/toxprofiles/tp111.html. Docket EPA-HQ-OAR-
2010-0162.
    \300\ WHO (2002). Concise International Chemical Assessment
Document 40: Formaldehyde. Published under the joint sponsorship of
the United Nations Environment Programme, the International Labour
Organization, and the World Health Organization, and produced within
the framework of the Inter-Organization Programme for the Sound
Management of Chemicals. Geneva. Docket EPA-HQ-OAR-2010-0162.
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(e) Acetaldehyde
    Acetaldehyde is classified in EPA's IRIS database as a probable
human carcinogen, based on nasal tumors in rats, and is considered
toxic by the inhalation, oral, and intravenous routes.\301\
Acetaldehyde is reasonably anticipated to be a human carcinogen by the
U.S. DHHS in the 11th Report on Carcinogens and is classified as
possibly carcinogenic to humans (Group 2B) by the
IARC.302 303 EPA is currently conducting a reassessment of
cancer risk from inhalation exposure to acetaldehyde.
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    \301\ U.S. EPA. 1991. Integrated Risk Information System File of
Acetaldehyde. Research and Development, National Center for
Environmental Assessment, Washington, DC. Available at http://
www.epa.gov/iris/subst/0290.htm. Docket EPA-HQ-OAR-2010-0162.
    \302\ U.S. Department of Health and Human Services National
Toxicology Program 11th Report on Carcinogens available at:
ntp.niehs.nih.gov/index.cfm?objectid=32BA9724-F1F6-975E-
7FCE50709CB4C932. Docket EPA-HQ-OAR-2010-0162.
    \303\ International Agency for Research on Cancer. 1999. Re-
evaluation of some organic chemicals, hydrazine, and hydrogen
peroxide. IARC Monographs on the Evaluation of Carcinogenic Risk of
Chemical to Humans, Vol 71. Lyon, France. Docket EPA-HQ-OAR-2010-
0162.
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    The primary noncancer effects of exposure to acetaldehyde vapors
include irritation of the eyes, skin, and respiratory tract.\304\ In
short-term (4 week) rat studies, degeneration of olfactory epithelium
was observed at various concentration levels of acetaldehyde
exposure.305 306 Data from these studies were used by EPA to
develop an inhalation reference concentration. Some asthmatics have
been shown to be a sensitive subpopulation to decrements in functional
expiratory volume (FEV1 test) and bronchoconstriction upon acetaldehyde
inhalation.\307\ The agency is currently conducting a reassessment of
the health hazards from inhalation exposure to acetaldehyde.
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    \304\ See Integrated Risk Information System File of
Acetaldehyde, Note 301, above.
    \305\ Appleman, L.M., R.A. Woutersen, V.J. Feron, R.N. Hooftman,
and W.R.F. Notten. 1986. Effects of the variable versus fixed
exposure levels on the toxicity of acetaldehyde in rats. J. Appl.
Toxicol. 6: 331-336. Docket EPA-HQ-OAR-2010-0162
    \306\ Appleman, L.M., R.A. Woutersen, and V.J. Feron. 1982.
Inhalation toxicity of acetaldehyde in rats. I. Acute and subacute
studies. Toxicology. 23: 293-297. Docket EPA-HQ-OAR-2010-0162.
    \307\ Myou, S.; Fujimura, M.; Nishi K.; Ohka, T.; and Matsuda,
T. 1993. Aerosolized acetaldehyde induces histamine-mediated
bronchoconstriction in asthmatics. Am. Rev. Respir.Dis. 148 (4 Pt
1): 940-3. Docket EPA-HQ-OAR-2010-0162.
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(f) Acrolein
    Acrolein is extremely acrid and irritating to humans when inhaled,
with acute exposure resulting in upper respiratory tract irritation,
mucus hypersecretion and congestion. The intense irritancy of this
carbonyl has been demonstrated during controlled tests in human
subjects, who suffer intolerable eye and nasal mucosal sensory
reactions within minutes of exposure.\308\ These data and additional
studies regarding acute effects of human exposure to acrolein are
summarized in EPA's 2003 IRIS Human Health Assessment for
acrolein.\309\ Evidence available from studies in humans indicate that
levels as low as 0.09 ppm (0.21 mg/m\3\) for five minutes may elicit
subjective complaints of eye irritation with increasing concentrations
leading to more extensive eye, nose and respiratory symptoms.\310\
Lesions to the lungs and upper respiratory tract of rats, rabbits, and
hamsters have been observed after subchronic exposure to acrolein.\311\
Acute exposure effects in animal studies report bronchial hyper-
responsiveness.\312\ In a recent study, the acute respiratory irritant
effects of exposure to 1.1 ppm acrolein were more pronounced in mice
with allergic airway disease by comparison to non-diseased mice which
also showed decreases in respiratory rate.\313\ Based on these animal
data and demonstration of similar effects in humans (e.g., reduction in
respiratory rate), individuals with compromised respiratory function
(e.g., emphysema, asthma) are expected to be at increased risk of
developing adverse responses to strong respiratory irritants such as
acrolein.
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    \308\ U.S. EPA (U.S. Environmental Protection Agency). (2003).
Toxicological review of acrolein in support of summary information
on Integrated Risk Information System (IRIS) National Center for
Environmental Assessment, Washington, DC. EPA/635/R-03/003. p. 10.
Available online at: http://www.epa.gov/ncea/ris/toxreviews/
0364tr.pdf. Docket EPA-HQ-OAR-2010-0162.
    \309\ See U.S. EPA 2003 Toxicological review of acrolein, Note
308, above.
    \310\ See U.S. EPA 2003 Toxicological review of acrolein, Note
308, at p. 11.
    \311\ Integrated Risk Information System File of Acrolein.
Office of Research and Development, National Center for
Environmental Assessment, Washington, DC. This material is available
at http://www.epa.gov/iris/subst/0364.htm. Docket EPA-HQ-OAR-2010-
0162.
    \312\ See U.S. 2003 Toxicological review of acrolein, Note 308,
at p. 15.
    \313\ Morris J.B., Symanowicz P.T., Olsen J.E., et al. 2003.
Immediate sensory nerve-mediated respiratory responses to irritants
in healthy and allergic airway-diseased mice. J Appl Physiol
94(4):1563-1571. Docket EPA-HQ-OAR-2010-0162.
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    EPA determined in 2003 that the human carcinogenic potential of
acrolein could not be determined because the available data were
inadequate. No information was available on the carcinogenic effects of

acrolein in humans and the animal data provided inadequate evidence of
carcinogenicity.\314\ The IARC determined in 1995 that acrolein was not
classifiable as to its carcinogenicity in humans.\315\
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    \314\ U.S. EPA. 2003. Integrated Risk Information System File of
Acrolein. Research and Development, National Center for
Environmental Assessment, Washington, DC. This material is available
at http://www.epa.gov/iris/subst/0364.htm Docket EPA-HQ-OAR-2010-
0162.
    \315\ International Agency for Research on Cancer. 1995.
Monographs on the evaluation of carcinogenic risk of chemicals to
humans, Volume 63. Dry cleaning, some chlorinated solvents and other
industrial chemicals, World Health Organization, Lyon, France.
Docket EPA-HQ-OAR-2010-0162.
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(g) Polycyclic Organic Matter
    Polycyclic organic matter is generally defined as a large class of
organic compounds which have multiple benzene rings and a boiling point
greater than 100[deg] Celsius. Many of the compounds included in the
class of compounds known as polycyclic organic matter are classified by
EPA as probable human carcinogens based on animal data. One of these
compounds, naphthalene, is discussed separately below. Polycyclic
aromatic hydrocarbons are a subset of polycyclic organic matter that
contains only hydrogen and carbon atoms. A number of polycyclic
aromatic hydrocarbons are known or suspected carcinogens. Recent
studies have found that maternal exposures to polycyclic aromatic
hydrocarbons (a subclass of polycyclic organic matter) in a population
of pregnant women were associated with several adverse birth outcomes,
including low birth weight and reduced length at birth, as well as
impaired cognitive development at age three.316 317 EPA has
not yet evaluated these recent studies.
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    \316\ Perera, F.P.; Rauh, V.; Tsai, W-Y.; et al. (2002). Effect
of transplacental exposure to environmental pollutants on birth
outcomes in a multiethnic population. Environ Health Perspect. 111:
201-205. Docket EPA-HQ-OAR-2010-0162.
    \317\ Perera, F.P.; Rauh, V.; Whyatt, R.M.; Tsai, W.Y.; Tang,
D.; Diaz, D.; Hoepner, L.; Barr, D.; Tu, Y.H.; Camann, D.; Kinney,
P. (2006). Effect of prenatal exposure to airborne polycyclic
aromatic hydrocarbons on neurodevelopment in the first 3 years of
life among inner-city children. Environ Health Perspect 114: 1287-
1292. Docket EPA-HQ-OAR-2010-0162.
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(h) Naphthalene
    Naphthalene is found in small quantities in gasoline and diesel
fuels. Naphthalene emissions have been measured in larger quantities in
both gasoline and diesel exhaust compared with evaporative emissions
from mobile sources, indicating it is primarily a product of
combustion. EPA released an external review draft of a reassessment of
the inhalation carcinogenicity of naphthalene based on a number of
recent animal carcinogenicity studies.\318\ The draft reassessment
completed external peer review.\319\ Based on external peer review
comments received, additional analyses are being undertaken. This
external review draft does not represent official agency opinion and
was released solely for the purposes of external peer review and public
comment. The National Toxicology Program listed naphthalene as
``reasonably anticipated to be a human carcinogen'' in 2004 on the
basis of bioassays reporting clear evidence of carcinogenicity in rats
and some evidence of carcinogenicity in mice.\320\ California EPA has
released a new risk assessment for naphthalene, and the IARC has
reevaluated naphthalene and re-classified it as Group 2B: possibly
carcinogenic to humans.\321\ Naphthalene also causes a number of
chronic non-cancer effects in animals, including abnormal cell changes
and growth in respiratory and nasal tissues.\322\
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    \318\ U. S. EPA. 2004. Toxicological Review of Naphthalene
(Reassessment of the Inhalation Cancer Risk), Environmental
Protection Agency, Integrated Risk Information System, Research and
Development, National Center for Environmental Assessment,
Washington, DC. This material is available electronically at http://
www.epa.gov/iris/subst/436.htm. Docket EPA-HQ-OAR-2010-0162.
    \319\ Oak Ridge Institute for Science and Education. (2004).
External Peer Review for the IRIS Reassessment of the Inhalation
Carcinogenicity of Naphthalene. August 2004. http://cfpub.epa.gov/
ncea/cfm/recordisplay.cfm?deid=84403. Docket EPA-HQ-OAR-2010-0162.
    \320\ National Toxicology Program (NTP). (2004). 11th Report on
Carcinogens. Public Health Service, U.S. Department of Health and
Human Services, Research Triangle Park, NC. Available from: http://
ntp-server.niehs.nih.gov. Docket EPA-HQ-OAR-2010-0162.
    \321\ International Agency for Research on Cancer. (2002).
Monographs on the Evaluation of the Carcinogenic Risk of Chemicals
for Humans. Vol. 82. Lyon, France. Docket EPA-HQ-OAR-2010-0162.
    \322\ U.S. EPA. 1998. Toxicological Review of Naphthalene,
Environmental Protection Agency, Integrated Risk Information System,
Research and Development, National Center for Environmental
Assessment, Washington, DC. This material is available
electronically at http://www.epa.gov/iris/subst/0436.htm. Docket
EPA-HQ-OAR-2010-0162.
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(i) Other Air Toxics
    In addition to the compounds described above, other compounds in
gaseous hydrocarbon and PM emissions from heavy-duty vehicles will be
affected by this proposal. Mobile source air toxic compounds that would
potentially be impacted include ethylbenzene, propionaldehyde, toluene,
and xylene. Information regarding the health effects of these compounds
can be found in EPA's IRIS database.\323\
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    \323\ U.S. EPA Integrated Risk Information System (IRIS)
database is available at: http://www.epa.gov/iris.
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(j) Exposure and Health Effects Associated With Traffic
    Populations who live, work, or attend school near major roads
experience elevated exposure concentrations to a wide range of air
pollutants, as well as higher risks for a number of adverse health
effects. While the previous sections of this preamble have focused on
the health effects associated with individual criteria pollutants or
air toxics, this section discusses the mixture of different exposures
near major roadways, rather than the effects of any single pollutant.
As such, this section emphasizes traffic-related air pollution, in
general, as the relevant indicator of exposure rather than any
particular pollutant.
    Concentrations of many traffic-generated air pollutants are
elevated for up to 300-500 meters downwind of roads with high traffic
volumes.\324\ Numerous sources on roads contribute to elevated roadside
concentrations, including exhaust and evaporative emissions, and
resuspension of road dust and tire and brake wear. Concentrations of
several criteria and hazardous air pollutants are elevated near major
roads. Furthermore, different semi-volatile organic compounds and
chemical components of particulate matter, including elemental carbon,
organic material, and trace metals, have been reported at higher
concentrations near major roads.
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    \324\ Zhou, Y.; Levy, J.I. (2007). Factors influencing the
spatial extent of mobile source air pollution impacts: A meta-
analysis. BMC Public Health 7: 89. doi:10.1186/1471-2458-7-89 Docket
EPA-HQ-OAR-2010-0162.
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    Populations near major roads experience greater risk of certain
adverse health effects. The Health Effects Institute published a report
on the health effects of traffic-related air pollution.\325\ It
concluded that evidence is ``sufficient to infer the presence of a
causal association'' between traffic exposure and exacerbation of
childhood asthma symptoms. The HEI report also concludes that the
evidence is either ``sufficient'' or ``suggestive but not sufficient''
for a causal association between traffic exposure and new childhood
asthma cases. A review of asthma studies by Salam et al. (2008)

reaches similar conclusions.\326\ The HEI report also concludes that
there is ``suggestive'' evidence for pulmonary function deficits
associated with traffic exposure, but concluded that there is
``inadequate and insufficient'' evidence for causal associations with
respiratory health care utilization, adult-onset asthma, chronic
obstructive pulmonary disease symptoms, and allergy. A review by
Holguin (2008) notes that the effects of traffic on asthma may be
modified by nutrition status, medication use, and genetic factors.\327\
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    \325\ HEI Panel on the Health Effects of Air Pollution. (2010).
Traffic-related air pollution: A critical review of the literature
on emissions, exposure, and health effects. [Online at http://
www.healtheffects.org.] Docket EPA-HQ-OAR-2010-0162.
    \326\ Salam, M.T.; Islam, T.; Gilliland, F.D. (2008). Recent
evidence for adverse effects of residential proximity to traffic
sources on asthma. Current Opin Pulm Med 14: 3-8. Docket EPA-HQ-OAR-
2010-0162.
    \327\ Holguin, F. (2008). Traffic, outdoor air pollution, and
asthma. Immunol Allergy Clinics North Am 28: 577-588. Docket EPA-HQ-
OAR-2010-0162.
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    The HEI report also concludes that evidence is ``suggestive'' of a
causal association between traffic exposure and all-cause and
cardiovascular mortality. There is also evidence of an association
between traffic-related air pollutants and cardiovascular effects such
as changes in heart rhythm, heart attack, and cardiovascular disease.
The HEI report characterizes this evidence as ``suggestive'' of a
causal association, and an independent epidemiological literature
review by Adar and Kaufman (2007) concludes that there is ``consistent
evidence'' linking traffic-related pollution and adverse cardiovascular
health outcomes.\328\
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    \328\ Adar, S.D.; Kaufman, J.D. (2007). Cardiovascular disease
and air pollutants: Evaluating and improving epidemiological data
implicating traffic exposure. Inhal Toxicol 19: 135-149. Docket EPA-
HQ-OAR-2010-0162.
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    Some studies have reported associations between traffic exposure
and other health effects, such as birth outcomes (e.g., low birth
weight) and childhood cancer. The HEI report concludes that there is
currently ``inadequate and insufficient'' evidence for a causal
association between these effects and traffic exposure. A review by
Raaschou-Nielsen and Reynolds (2006) concluded that evidence of an
association between childhood cancer and traffic-related air pollutants
is weak, but noted the inability to draw firm conclusions based on
limited evidence.\329\
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    \329\ Raaschou-Nielsen, O.; Reynolds, P. (2006). Air pollution
and childhood cancer: A review of the epidemiological literature.
Int J Cancer 118: 2920-2929. Docket EPA-HQ-OAR-2010-0162.
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    There is a large population in the United States living in close
proximity of major roads. According to the Census Bureau's American
Housing Survey for 2007, approximately 20 million residences in the
United States, 15.6% of all homes, are located within 300 feet (91 m)
of a highway with 4+ lanes, a railroad, or an airport.\330\ Therefore,
at current population of approximately 309 million, assuming that
population and housing are similarly distributed, there are over 48
million people in the United States living near such sources. The HEI
report also notes that in two North American cities, Los Angeles and
Toronto, over 40% of each city's population live within 500 meters of a
highway or 100 meters of a major road. It also notes that about 33% of
each city's population resides within 50 meters of major roads.
Together, the evidence suggests that a large U.S. population lives in
areas with elevated traffic-related air pollution.
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    \330\ U.S. Census Bureau (2008). American Housing Survey for the
United States in 2007. Series H-150 (National Data), Table 1A-7.
[Accessed at http://www.census.gov/hhes/www/housing/ahs/ahs07/
ahs07.html on January 22, 2009] Docket EPA-HQ-OAR-2010-0162.
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    People living near roads are often socioeconomically disadvantaged.
According to the 2007 American Housing Survey, a renter-occupied
property is over twice as likely as an owner-occupied property to be
located near a highway with 4+ lanes, railroad or airport. In the same
survey, the median household income of rental housing occupants was
less than half that of owner-occupants ($28,921/$59,886). Numerous
studies in individual urban areas report higher levels of traffic-
related air pollutants in areas with high minority or poor
populations.331 332 333
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    \331\ Lena, T.S.; Ochieng, V.; Carter, M.; Holgu[iacute]n-Veras,
J.; Kinney, P.L. (2002). Elemental carbon and PM2.5 levels in an
urban community heavily impacted by truck traffic. Environ Health
Perspect 110: 1009-1015. Docket EPA-HQ-OAR-2010-0162.
    \332\ Wier, M.; Sciammas, C.; Seto, E.; Bhatia, R.; Rivard, T.
(2009). Health, traffic, and environmental justice: collaborative
research and community action in San Francisco, California. Am J
Public Health 99: S499-S504. Docket EPA-HQ-OAR-2010-0162.
    \333\ Forkenbrock, D.J. and L.A. Schweitzer, Environmental
Justice and Transportation Investment Policy. Iowa City: University
of Iowa, 1997. Docket EPA-HQ-OAR-2010-0162.
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    Students may also be exposed in situations where schools are
located near major roads. In a study of nine metropolitan areas across
the United States, Appatova et al. (2008) found that on average greater
than 33% of schools were located within 400 m of an Interstate, U.S.,
or State highway, while 12% were located within 100 m.\334\ The study
also found that among the metropolitan areas studied, schools in the
Eastern United States were more often sited near major roadways than
schools in the Western United States.
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    \334\ Appatova, A.S.; Ryan, P.H.; LeMasters, G.K.; Grinshpun,
S.A. (2008). Proximal exposure of public schools and students to
major roadways: A nationwide U.S. survey. J Environ Plan Mgmt Docket
EPA-HQ-OAR-2010-0162.
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    Demographic studies of students in schools near major roadways
suggest that this population is more likely than the general student
population to be of non-white race or Hispanic ethnicity, and more
often live in low socioeconomic status locations.335 336 337
There is some inconsistency in the evidence, which may be due to
different local development patterns and measures of traffic and
geographic scale used in the studies.\334\
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    \335\ Green, R.S.; Smorodinsky, S.; Kim, J.J.; McLaughlin, R.;
Ostro, B. (2004). Proximity of California public schools to busy
roads. Environ Health Perspect 112: 61-66. Docket EPA-HQ-OAR-2010-
0162.
    \336\ Houston, D.; Ong, P.; Wu, J.; Winer, A. (2006). Proximity
of licensed child care facilities to near-roadway vehicle pollution.
Am J Public Health 96: 1611-1617. Docket EPA-HQ-OAR-2010-0162.
    \337\ Wu, Y.; Batterman, S. (2006). Proximity of schools in
Detroit, Michigan to automobile and truck traffic. J Exposure Sci
Environ Epidemiol 16: 457-470. Docket EPA-HQ-OAR-2010-0162.
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C. Environmental Effects of Non-GHG Pollutants

    In this section we discuss some of the environmental effects of PM
and its precursors such as visibility impairment, atmospheric
deposition, and materials damage and soiling, as well as environmental
effects associated with the presence of ozone in the ambient air, such
as impacts on plants, including trees, agronomic crops and urban
ornamentals, and environmental effects associated with air toxics.
(1) Visibility
    Visibility can be defined as the degree to which the atmosphere is
transparent to visible light.\338\ Visibility impairment is caused by
light scattering and absorption by suspended particles and gases.
Visibility is important because it has direct significance to people's
enjoyment of daily activities in all parts of the country. Individuals
value good visibility for the well-being it provides them directly,
where they live and work, and in places where they enjoy recreational
opportunities. Visibility is also highly valued in significant natural
areas, such as national parks and wilderness areas, and special
emphasis is given to protecting visibility in these

areas. For more information on visibility see the final 2009 PM
ISA.\339\
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    \338\ National Research Council, 1993. Protecting Visibility in
National Parks and Wilderness Areas. National Academy of Sciences
Committee on Haze in National Parks and Wilderness Areas. National
Academy Press, Washington, DC. Docket EPA-HQ-OAR-2010-0162. This
book can be viewed on the National Academy Press Web site at http://
www.nap.edu/books/0309048443/html/.
    \339\ See U.S. EPA 2009. Final PM ISA, Note 243.
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    EPA is pursuing a two-part strategy to address visibility. First,
EPA has concluded that PM2.5 causes adverse effects on visibility in
various locations, depending on PM concentrations and factors such as
chemical composition and average relative humidity, and has set
secondary PM2.5 standards.\340\ The secondary PM2.5
standards act in conjunction with the regional haze program. EPA's
regional haze rule (64 FR 35714) was put in place in July 1999 to
protect the visibility in Mandatory Class I Federal areas. There are
156 national parks, forests and wilderness areas categorized as
Mandatory Class I Federal areas (62 FR 38680-38681, July 18,
1997).\341\ Visibility can be said to be impaired in both PM2.5
nonattainment areas and Mandatory Class I Federal areas.
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    \340\ The existing annual primary and secondary PM2.5
standards have been remanded and are being addressed in the
currently ongoing PM NAAQS review.
    \341\ These areas are defined in CAA section 162 as those
national parks exceeding 6,000 acres, wilderness areas and memorial
parks exceeding 5,000 acres, and all international parks which were
in existence on August 7, 1977.
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(2) Plant and Ecosystem Effects of Ozone
    Elevated ozone levels contribute to environmental effects, with
impacts to plants and ecosystems being of most concern. Ozone can
produce both acute and chronic injury in sensitive species depending on
the concentration level and the duration of the exposure. Ozone effects
also tend to accumulate over the growing season of the plant, so that
even low concentrations experienced for a longer duration have the
potential to create chronic stress on vegetation. Ozone damage to
plants includes visible injury to leaves and impaired photosynthesis,
both of which can lead to reduced plant growth and reproduction,
resulting in reduced crop yields, forestry production, and use of
sensitive ornamentals in landscaping. In addition, the impairment of
photosynthesis, the process by which the plant makes carbohydrates (its
source of energy and food), can lead to a subsequent reduction in root
growth and carbohydrate storage below ground, resulting in other, more
subtle plant and ecosystems impacts.
    These latter impacts include increased susceptibility of plants to
insect attack, disease, harsh weather, interspecies competition and
overall decreased plant vigor. The adverse effects of ozone on forest
and other natural vegetation can potentially lead to species shifts and
loss from the affected ecosystems, resulting in a loss or reduction in
associated ecosystem goods and services. Lastly, visible ozone injury
to leaves can result in a loss of aesthetic value in areas of special
scenic significance like national parks and wilderness areas. The final
2006 Ozone Air Quality Criteria Document presents more detailed
information on ozone effects on vegetation and ecosystems.
(3) Atmospheric Deposition
    Wet and dry deposition of ambient particulate matter delivers a
complex mixture of metals (e.g., mercury, zinc, lead, nickel, aluminum,
cadmium), organic compounds (e.g., polycyclic organic matter, dioxins,
furans) and inorganic compounds (e.g., nitrate, sulfate) to terrestrial
and aquatic ecosystems. The chemical form of the compounds deposited
depends on a variety of factors including ambient conditions (e.g.,
temperature, humidity, oxidant levels) and the sources of the material.
Chemical and physical transformations of the compounds occur in the
atmosphere as well as the media onto which they deposit. These
transformations in turn influence the fate, bioavailability and
potential toxicity of these compounds. Atmospheric deposition has been
identified as a key component of the environmental and human health
hazard posed by several pollutants including mercury, dioxin and
PCBs.\342\
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    \342\ U.S. EPA (2000). Deposition of Air Pollutants to the Great
Waters: Third Report to Congress. Office of Air Quality Planning and
Standards. EPA-453/R-00-0005. Docket EPA-HQ-OAR-2010-0162.
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    Adverse impacts on water quality can occur when atmospheric
contaminants deposit to the water surface or when material deposited on
the land enters a waterbody through runoff. Potential impacts of
atmospheric deposition to waterbodies include those related to both
nutrient and toxic inputs. Adverse effects to human health and welfare
can occur from the addition of excess nitrogen via atmospheric
deposition. The nitrogen-nutrient enrichment contributes to toxic algae
blooms and zones of depleted oxygen, which can lead to fish kills,
frequently in coastal waters. Deposition of heavy metals or other
toxics may lead to the human ingestion of contaminated fish, impairment
of drinking water, damage to the marine ecology, and limits to
recreational uses. Several studies have been conducted in U.S. coastal
waters and in the Great Lakes Region in which the role of ambient PM
deposition and runoff is investigated.343 344 345 346 347
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    \343\ U.S. EPA (2004). National Coastal Condition Report II.
Office of Research and Development/Office of Water. EPA-620/R-03/
002. Docket EPA-HQ-OAR-2010-0162.
    \344\ Gao, Y., E.D. Nelson, M.P. Field, et al. 2002.
Characterization of atmospheric trace elements on PM2.5 particulate
matter over the New York-New Jersey harbor estuary. Atmos. Environ.
36: 1077-1086. Docket EPA-HQ-OAR-2010-0162.
    \345\ Kim, G., N. Hussain, J.R. Scudlark, and T.M. Church. 2000.
Factors influencing the atmospheric depositional fluxes of stable
Pb, 210Pb, and 7Be into Chesapeake Bay. J. Atmos. Chem. 36: 65-79.
Docket EPA-HQ-OAR-2010-0162.
    \346\ Lu, R., R.P. Turco, K. Stolzenbach, et al. 2003. Dry
deposition of airborne trace metals on the Los Angeles Basin and
adjacent coastal waters. J. Geophys. Res. 108(D2, 4074): AAC 11-1 to
11-24. Docket EPA-HQ-OAR-2010-0162.
    \347\ Marvin, C.H., M.N. Charlton, E.J. Reiner, et al. 2002.
Surficial sediment contamination in Lakes Erie and Ontario: A
comparative analysis. J. Great Lakes Res. 28(3): 437-450. Docket
EPA-HQ-OAR-2010-0162.
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    Atmospheric deposition of nitrogen and sulfur contributes to
acidification, altering biogeochemistry and affecting animal and plant
life in terrestrial and aquatic ecosystems across the United States.
The sensitivity of terrestrial and aquatic ecosystems to acidification
from nitrogen and sulfur deposition is predominantly governed by
geology. Prolonged exposure to excess nitrogen and sulfur deposition in
sensitive areas acidifies lakes, rivers and soils. Increased acidity in
surface waters creates inhospitable conditions for biota and affects
the abundance and nutritional value of preferred prey species,
threatening biodiversity and ecosystem function. Over time, acidifying
deposition also removes essential nutrients from forest soils,
depleting the capacity of soils to neutralize future acid loadings and
negatively affecting forest sustainability. Major effects include a
decline in sensitive forest tree species, such as red spruce (Picea
rubens) and sugar maple (Acer saccharum), and a loss of biodiversity of
fishes, zooplankton, and macro invertebrates.
    In addition to the role nitrogen deposition plays in acidification,
nitrogen deposition also leads to nutrient enrichment and altered
biogeochemical cycling. In aquatic systems increased nitrogen can alter
species assemblages and cause eutrophication. In terrestrial systems
nitrogen loading can lead to loss of nitrogen sensitive lichen species,
decreased biodiversity of grasslands, meadows and other sensitive
habitats, and increased potential for invasive species. For a broader
explanation of the topics treated here, refer to the description in
Section 7.1.2 of the draft RIA.

    Adverse impacts on soil chemistry and plant life have been observed
for areas heavily influenced by atmospheric deposition of nutrients,
metals and acid species, resulting in species shifts, loss of
biodiversity, forest decline and damage to forest productivity.
Potential impacts also include adverse effects to human health through
ingestion of contaminated vegetation or livestock (as in the case for
dioxin deposition), reduction in crop yield, and limited use of land
due to contamination.
    Atmospheric deposition of pollutants can reduce the aesthetic
appeal of buildings and culturally important articles through soiling,
and can contribute directly (or in conjunction with other pollutants)
to structural damage by means of corrosion or erosion. Atmospheric
deposition may affect materials principally by promoting and
accelerating the corrosion of metals, by degrading paints, and by
deteriorating building materials such as concrete and limestone.
Particles contribute to these effects because of their electrolytic,
hygroscopic, and acidic properties, and their ability to adsorb
corrosive gases (principally sulfur dioxide).
(4) Environmental Effects of Air Toxics
    Emissions from producing, transporting and combusting fuel
contribute to ambient levels of pollutants that contribute to adverse
effects on vegetation. Volatile organic compounds, some of which are
considered air toxics, have long been suspected to play a role in
vegetation damage.\348\ In laboratory experiments, a wide range of
tolerance to VOCs has been observed.\349\ Decreases in harvested seed
pod weight have been reported for the more sensitive plants, and some
studies have reported effects on seed germination, flowering and fruit
ripening. Effects of individual VOCs or their role in conjunction with
other stressors (e.g., acidification, drought, temperature extremes)
have not been well studied. In a recent study of a mixture of VOCs
including ethanol and toluene on herbaceous plants, significant effects
on seed production, leaf water content and photosynthetic efficiency
were reported for some plant species.\350\
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    \348\ U.S. EPA. 1991. Effects of organic chemicals in the
atmosphere on terrestrial plants. EPA/600/ 3-91/001. Docket EPA-HQ-
OAR-2010-0162.
    \349\ Cape JN, ID Leith, J Binnie, J Content, M Donkin, M
Skewes, DN Price AR Brown, AD Sharpe. 2003. Effects of VOCs on
herbaceous plants in an open-top chamber experiment. Environ.
Pollut. 124:341-343. Docket EPA-HQ-OAR-2010-0162.
    \350\ Cape JN, ID Leith, J Binnie, J Content, M Donkin, M
Skewes, DN Price AR Brown, AD Sharpe. 2003. Effects of VOCs on
herbaceous plants in an open-top chamber experiment. Environ.
Pollut. 124:341-343. Docket EPA-HQ-OAR-2010-0162.
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    Research suggests an adverse impact of vehicle exhaust on plants,
which has in some cases been attributed to aromatic compounds and in
other cases to nitrogen oxides.351 352 353 The impacts of
VOCs on plant reproduction may have long-term implications for
biodiversity and survival of native species near major roadways. Most
of the studies of the impacts of VOCs on vegetation have focused on
short-term exposure and few studies have focused on long-term effects
of VOCs on vegetation and the potential for metabolites of these
compounds to affect herbivores or insects.
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    \351\ Viskari E-L. 2000. Epicuticular wax of Norway spruce
needles as indicator of traffic pollutant deposition. Water, Air,
and Soil Pollut. 121:327-337. Docket EPA-HQ-OAR-2010-0162.
    \352\ Ugrekhelidze D, F Korte, G Kvesitadze. 1997. Uptake and
transformation of benzene and toluene by plant leaves. Ecotox.
Environ. Safety 37:24-29. Docket EPA-HQ-OAR-2010-0162.
    \353\ Kammerbauer H, H Selinger, R Rommelt, A Ziegler-Jons, D
Knoppik, B Hock. 1987. Toxic components of motor vehicle emissions
for the spruce Picea abies. Environ. Pollut. 48:235-243. Docket EPA-
HQ-OAR-2010-0162.
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D. Air Quality Impacts of Non-GHG Pollutants

(1) Current Levels of Non-GHG Pollutants
    This proposal may have impacts on ambient concentrations of
criteria and air toxic pollutants. Nationally, levels of
PM2.5, ozone, NOX, SOX, CO and air
toxics are declining.\354\ However, approximately 127 million people
lived in counties that exceeded any NAAQS in 2008.\355\ These numbers
do not include the people living in areas where there is a future risk
of failing to maintain or attain the NAAQS. It is important to note
that these numbers do not account for potential SO2,
NO2 or Pb nonattainment areas which have not yet been
designated. Also, EPA is currently reviewing the standards for PM and
CO, and those standards could be made more protective, which would
increase the number of people living in nonattainment areas.
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    \354\ U.S. EPA (2010). Our Nation's Air: Status and Trends
through 2008. Office of Air Quality Planning and Standards, Research
Triangle Park, NC. Publication No. EPA 454/R-09-002. http://
www.epa.gov/airtrends/2010/. Docket EPA-HQ-OAR-2010-0162.
    \355\ See U.S. EPA Trends, Note 354.
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    Further, the majority of Americans continue to be exposed to
ambient concentrations of air toxics at levels which have the potential
to cause adverse health effects.356 357 The levels of air
toxics to which people are exposed vary depending on where people live
and work and the kinds of activities in which they engage, as discussed
in detail in U.S. EPA's recent mobile source air toxics rule.\358\
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    \356\ U.S. Environmental Protection Agency (2007). Control of
Hazardous Air Pollutants from Mobile Sources; Final Rule. 72 FR
8434, February 26, 2007.
    \357\ See U.S. EPA 2010, Light-Duty 2012-2016 MY Vehicle Rule,
Note 6.
    \358\ See U.S. EPA 2007, Note 356.
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(2) Impacts of Proposed Standards on Future Ambient Concentrations of
PM2.5, Ozone and Air Toxics
    Full-scale photochemical air quality modeling is necessary to
accurately project levels of criteria pollutants and air toxics. For
the final rulemaking, a national-scale air quality modeling analysis
will be performed to analyze the impacts of the standards on
PM2.5, ozone, and selected air toxics (i.e., benzene,
formaldehyde, acetaldehyde, acrolein and 1,3-butadiene). The length of
time needed to prepare the necessary emissions inventories, in addition
to the processing time associated with the modeling itself, has
precluded us from performing air quality modeling for this proposal.
    Sections VII.A and VII.B of the preamble present projections of the
changes in criteria pollutant and air toxics emissions due to the
proposed vehicle standards; the basis for those estimates is set out in
Chapter 6 of the draft RIA. The atmospheric chemistry related to
ambient concentrations of PM2.5, ozone and air toxics is
very complex, and making predictions based solely on emissions changes
is extremely difficult. However, based on the magnitude of the
emissions changes predicted to result from the proposed standards, EPA
expects that there will be a relatively small change in ambient air
quality, pending a more comprehensive analysis for the final
rulemaking.
    For the final rulemaking, EPA intends to use a 2005-based Community
Multi-scale Air Quality (CMAQ) modeling platform as the tool for the
air quality modeling. The CMAQ modeling system is a comprehensive
three-dimensional grid-based Eulerian air quality model designed to
estimate the formation and fate of oxidant precursors, primary and
secondary PM concentrations and deposition, and air toxics, over
regional and urban spatial scales (e.g., over the contiguous United
States).359 360 361 362

The CMAQ model is a well-known and well-established tool and is
commonly used by EPA for regulatory analyses, for instance the recent
ozone NAAQS proposal, and by States in developing attainment
demonstrations for their State Implementation Plans.\363\ The CMAQ
model version 4.7 was most recently peer-reviewed in February of 2009
for the U.S. EPA.\364\
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    \359\ U.S. Environmental Protection Agency, Byun, D.W., and
Ching, J.K.S., Eds, 1999. Science algorithms of EPA Models-3
Community Multiscale Air Quality (CMAQ modeling system, EPA/600/R-
99/030, Office of Research and Development). Docket EPA-HQ-OAR-2010-
0162.
    \360\ Byun, D.W., and Schere, K.L., 2006. Review of the
Governing Equations, Computational Algorithms, and Other Components
of the Models-3 Community Multiscale Air Quality (CMAQ) Modeling
System, J. Applied Mechanics Reviews, 59 (2), 51-77. Docket EPA-HQ-
OAR-2010-0162.
    \361\ Dennis, R.L., Byun, D.W., Novak, J.H., Galluppi, K.J.,
Coats, C.J., and Vouk, M.A., 1996. The next generation of integrated
air quality modeling: EPA's Models-3, Atmospheric Environment, 30,
1925-1938. Docket EPA-HQ-OAR-2010-0162.
    \362\ Carlton, A., Bhave, P., Napelnok, S., Edney, E., Sarwar,
G., Pinder, R., Pouliot, G., and Houyoux, M. Model Representation of
Secondary Organic Aerosol in CMAQv4.7. Ahead of Print in
Environmental Science and Technology. Accessed at: http://
pubs.acs.org/doi/abs/10.1021/
es100636q?prevSearch=CMAQ&searchHistoryKey Docket EPA-HQ-OAR-2010-
0162.
    \363\ U.S. EPA (2007). Regulatory Impact Analysis of the
Proposed Revisions to the National Ambient Air Quality Standards for
Ground-Level Ozone. EPA document number 442/R-07-008, July 2007.
Docket EPA-HQ-OAR-2010-0162
    \364\ Allen, D. et al. (2009). Report on the Peer Review of the
Atmospheric Modeling and Analysis Division, National Exposure
Research Laboratory, Office of Research and Development, U.S. EPA.
http://www.epa.gov/asmdnerl/peer/reviewdocs.html. Docket EPA-HQ-OAR-
2010-0162.
_____________________________________-

    CMAQ includes many science modules that simulate the emission,
production, decay, deposition and transport of organic and inorganic
gas-phase and particle-phase pollutants in the atmosphere. EPA intends
to use the most recent version of CMAQ which reflects updates to
version 4.7 to improve the underlying science. These include aqueous
chemistry mass conservation improvements, improved vertical convective
mixing and lowered CB05 mechanism unit yields for acrolein from 1,3-
butadiene tracer reactions which were updated to be consistent with
laboratory measurements.

VIII.What are the agencies' estimated cost, economic, and other impacts
of the proposed program?

    In this section, we present the costs and impacts of the proposed
HD National Program. It is important to note that NHTSA's proposed fuel
consumption standards and EPA's proposed GHG standards would both be in
effect, and each would lead to average fuel economy increases and GHG
emission reductions. The two agencies' proposed standards would
comprise the HD National Program.
    The net benefits of the proposed HD National Program consist of the
effects of the program on:
     The vehicle program costs (costs of complying with the
vehicle CO2 standards)
     Fuel savings associated with reduced fuel usage resulting
from the program
     The economic value of reductions in greenhouse gas
emissions,
     The reductions in other (non-GHG) pollutants,
     Costs associated with increases in noise, congestion, and
accidents resulting from increased vehicle use,
     The economic value of improvements in U.S. energy security
impacts,
     Benefits associated with increased vehicle use due to the
``rebound'' effect.
    We also present the cost-effectiveness of the standards, or the
cost per ton of emissions reduced. A few effects of the program, such
as the effects on other pollutants, are not included here. We plan to
add the effects of other pollutants to the analysis for the final
rules.
    The program may have other effects that are not included here. The
agencies seek comment on whether any costs or benefits are omitted from
this analysis, so that they can be explicitly recognized in the final
rules. In particular, as discussed in Section III and in Chapter 2 of
the draft RIA, the technology cost estimates developed here take into
account the costs to hold other vehicle attributes, such as size and
performance, constant. In addition, the analysis assumes that the full
technology costs are passed along to vehicle buyers. With these
assumptions, because welfare losses are monetary estimates of how much
buyers would have to be compensated to be made as well off as in the
absence of the change,\365\ the price increase measures the loss to the
buyer.\366\ Assuming that the full technology cost gets passed along to
the buyer as an increase in price, the technology cost thus measures
the welfare loss to the buyer. Increasing fuel economy would have to
lead to other changes in the vehicles that buyers find undesirable for
there to be additional losses not included in the technology costs.
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    \365\ This approach describes the economic concept of
compensating variation, a payment of money after a change that would
make a consumer as well off after the change as before it. A related
concept, equivalent variation, estimates the income change that
would be an alternative to the change taking place. The difference
between them is whether the consumer's point of reference is her
welfare before the change (compensating variation) or after the
change (equivalent variation). In practice, these two measures are
typically very close together.
    \366\ Indeed, it is likely to be an overestimate of the loss to
the consumer, because the consumer has choices other than buying the
same vehicle with a higher price; she could choose a different
vehicle, or decide not to buy a new vehicle. The consumer would
choose one of those options only if the alternative involves less
loss than paying the higher price. Thus, the increase in price that
the consumer faces would be the upper bound of loss of consumer
welfare, unless there are other changes to the vehicle due to the
fuel economy improvements that make the vehicle less desirable to
consumers.
---------------------------------------------------------------------------

    The costs estimates include the costs of holding other vehicle
attributes, such as performance, constant. The 2010 light-duty GHG/CAFE
rule, discussed that if other vehicle attributes are not held constant,
then the cost estimates do not capture the impacts of these
changes.\367\ The light duty rule also discussed other potential issues
that could affect the calculation of the welfare impacts of these types
of changes, such as behavioral issues affecting the demand for
technology investments, investment horizon uncertainty, and the rate at
which truck owners trade off higher vehicle purchase price against
future fuel savings. The agencies seek comments, including supporting
data and quantitative analyses, if possible, of any additional impacts
of the proposed standards on vehicle attributes and performance, and
other potential aspects that could positively or negatively affect the
welfare implications of this proposed rulemaking, not addressed in this
analysis.
---------------------------------------------------------------------------

    \367\ Environmental Protection Agency and Department of
Transportation, ``Light-Duty Vehicle Greenhouse Gas Emissions
Standards and Corporate Average Fuel Economy Standards; Final
Rule,'' Federal Register 75(88) (May 7, 2010). See especially
sections III.H.1 (pp. 25510-25513) and IV.G.6 (pp. 25651-25657).
---------------------------------------------------------------------------

    The total monetized benefits (excluding fuel savings) under the
program are projected to be $1.5 to $7.9 billion in 2030, depending on
the value used for the social cost of carbon. These benefits are
summarized below in Table VIII-25. The costs of the program in 2030 are
estimated to be approximately $1.9 billion for new engine and truck
technology less $19 billion in savings realized by trucking operations
through fewer fuel expenditures (calculated using pre-tax fuel prices).
These costs are summarized below in Table VIII-24. The present value of
the total monetized benefits (excluding fuel savings) under the program
are expected to range from $23 billion to $150 billion with a 3%
discount rate; with a 7% discount rate, the total monetized benefits
are expected to range from $15 billion to

$140 billion. These values, summarized in Table VIII-25, depend on the
value used for the social cost of carbon. The present value of costs of
the program for new engine and truck technology, in Table VIII-24, are
expected to be $42 billion using a 3% discount rate, and $23 billion
with a 7% discount rate, less fuel savings (calculated using pre-tax
fuel prices) of $350 billion with a 3% discount rate, and $150 billion
with a 7% discount rate. Total present net benefits (in Table VIII-26)
are thus expected to range from $330 billion to $460 billion with a 3%
discount rate, and $150 billion to $270 billion with a 7% discount
rate.
    The estimates developed here are measured against a baseline fuel
economy associated with MY 2010 vehicles. The extent to which fuel
economy improvements may have occurred in the absence of the rules
affect the net benefits associated with the rule. If trucks would have
ended up installing technologies to achieve the fuel savings and
reduced GHG emissions in the absence of this proposal, then both the
costs and benefits of these fuel savings could be attributed to market
forces, not the rules. At this time, the agencies do not have estimates
of the extent of fuel-saving technologies that might have been adopted
in the absence of this proposal. We seek comment on whether the
agencies should use an alternative baseline based on data provided by
commenters to estimate the degree to which the technologies discussed
in this proposal would have been adopted in the absence of this
proposal.
    EPA has undertaken an analysis of the economy-wide impacts of the
proposed heavy-duty truck fuel efficiency and GHG standards as an
exploratory exercise that EPA believes could provide additional
insights into the potential impacts of the program.\368\ These results
were not a factor regarding the appropriateness of the proposed
standards. It is important to note that the results of this modeling
exercise are dependent on the assumptions associated with how
manufacturers would make fuel efficiency improvements and how trucking
operations would respond to increases in higher vehicle costs and
improved vehicle fuel efficiency as a result of the proposed program.
---------------------------------------------------------------------------

    \368\ See Memorandum to Docket, ``Economy-Wide Impacts of
Proposed Heavy-Duty Truck Greenhouse Gas Emissions and Fuel
Efficiency Standards'', October 8, 2010. Docket EPA-HQ-OAR-2010-
0162.
---------------------------------------------------------------------------

    Further information on these and other aspects of the economic
impacts of our rules are summarized in the following sections and are
presented in more detail in the draft RIA for this proposed rulemaking.

A. Conceptual Framework for Evaluating Impacts

    This regulation is motivated primarily by the goals of reducing
emissions of greenhouse gases and promoting U.S. energy security by
reducing consumption and imports of petroleum-based fuels. These
motivations involve classic externalities, meaning that private
decisions do not incorporate all of the costs associated with these
problems; these costs are not borne completely by the households or
businesses whose actions are responsible for them. In the absence of
some mechanism to ``internalize'' these costs--that is, to transfer
their burden to individuals or firms whose decisions impose them--
individuals and firms will consume more petroleum-based fuels than is
socially optimal. Externalities are a classic motivation for government
intervention in markets. These externalities, as well as effects due to
changes in emissions of other pollutants and other impacts, are
discussed in Sections VIII.H-VIII.J.
    In some cases, these classic externalities are by themselves enough
to justify the costs of imposing fuel efficiency standards. For some
discount rates and some projected social costs of carbon, however, the
reductions in these external costs are less than the costs of new fuel
saving technologies needed to meet the standards. (See Tables 9-18 and
9-19 in the draft RIA.) Nevertheless, this regulation reduces trucking
companies' fuel costs; according to our estimates, these savings in
fuel costs are by themselves sufficient to pay for the technologies
over periods of time considerably shorter than vehicles' expected
lifetimes under the assumptions used for this analysis (e.g., AEO 2010
projected fuel prices). If these estimates are correct, then the entire
value of the reductions in external costs represents additional net
benefits of the rule, beyond those resulting from the fact that the
value of fuel savings exceeds the costs of technologies necessary to
achieve them.
    It is often asserted that there are cost-effective fuel-saving
technologies that truck companies are not taking advantage of. This is
commonly known as the ``energy gap'' or ``energy paradox.'' Standard
economic theory suggests that in normally functioning competitive
markets, interactions between vehicle buyers and producers would lead
producers to incorporate all cost-effective technology into the
vehicles that they offer, without government intervention. Unlike in
the light-duty vehicle market, the vast majority of vehicles in the
medium- and heavy-duty truck market are purchased and operated by
businesses with narrow profit margins, and for which fuel costs
represent a substantial operating expense.
    Even in the presence of uncertainty and imperfect information--
conditions that hold to some degree in every market--we generally
expect firms to attempt to minimize their costs in an effort to survive
in a competitive marketplace, and therefore to make decisions that are
in the best interest of the company and its owners and/or shareholders.
In this case, the benefits of the rules would be due exclusively to
reducing the economic costs of externalities resulting from fuel
production and consumption. However, as discussed below in Section
VIII.E, the agencies have estimated that the application of fuel-saving
technologies in response to the proposed standards would, on average,
yield private returns to truck owners of 140% to 420% (see Table VIII-
21 below). The agencies have also estimated that the application of
these technologies would be significantly lower in the absence of the
proposed standards (i.e., under the ``no action'' regulatory
alternative), meaning that truck buyers and operators ignore
opportunities to make investments in higher fuel economy that appear to
offer significant cost savings.
    There are several possible explanations in the economics literature
for why trucking companies do not adopt technologies that would be
expected to increase their profits: there could be a classic market
failure in the trucking industry--market power, externalities, or
asymmetric or incomplete (i.e., missing market) information; there
could be institutional or behavioral rigidities in the industry (union
rules, standard operating procedures, statutory requirements, loss
aversion, etc.), whereby participants collectively do not minimize
costs; or the engineering estimates of fuel savings and costs for these
technologies might overstate their benefits or understate their costs
in real-world applications.
    To try to understand why trucking companies have not adopted these
seemingly cost-effective fuel-saving technologies, the agencies have
surveyed published literature about the energy paradox, and held
discussions with numerous truck market participants. Below, we have
listed five categories of possible explanations derived from these
sources. Collectively, these five hypotheses may explain the apparent
inconsistency between the

engineering analysis, which finds a number of cost-effective methods of
improving fuel economy, and the observation that many of these
technologies are not widely adopted.
    These hypotheses include imperfect information in the original and
resale markets, split incentives, uncertainty about future fuel prices,
and adjustment and transactions costs. As the discussion will indicate,
some of these explanations suggest failures in the private market for
fuel-saving technology in addition to the externalities caused by
producing and consuming fuel that are the primary motivation for the
rules. Other explanations suggest market-based behaviors that may imply
additional costs of regulating truck fuel efficiency that are not
accounted for in this analysis. Anecdotal evidence from various
segments of the trucking industry suggests that many of these
hypotheses may play a role in explaining the puzzle of why truck
purchasers appear to under-invest in fuel economy, although different
explanations may apply to different segments, or even different
companies. The published literature does not appear to include
empirical analysis or data related to this question.
    The agencies invite comment on these explanations, and on any data
or information that could be used to investigate the role of any or all
of these five hypotheses in explaining this energy paradox as it
applies specifically to trucks. The agencies also request comment and
information regarding any other hypotheses that could explain the
appearance that cost-effective fuel-saving technologies have not been
widely incorporated into trucks.
(1) Information Issues in the Original Sale Markets
    One potential hypothesis for why the trucking industry does not
adopt what appear to be inexpensive fuel saving technologies is that
there is inadequate or unreliable information available about the
effectiveness of many fuel-saving technologies for new vehicles. As the
NAS report notes, ``Reliable, peer-reviewed data on fuel saving
performance is available only for a few technologies in a few
applications. As a result, the committee had to rely on information
from a wide range of sources, * * * including many results that have
not been duplicated by other researchers or verified over a range of
duty cycles.'' If reliable information on the effectiveness of many new
technologies is absent, truck buyers will understandably be reluctant
to spend additional money to purchase vehicles equipped with unproven
technologies.
    This lack of information can manifest itself in multiple ways. For
instance, the problem may arise purely because collecting reliable
information on technologies is costly (also see Section VIII.A.5 on
transaction costs). Moreover, information has aspects of a public good,
in that no single firm has the incentive to do the costly
experimentation to determine whether or not particular technologies are
cost-effective, while all firms benefit from the knowledge that would
be gained from that experimentation. Similarly, if multiple firms must
conduct the same tests to get the same information, costs could be
reduced by some form of coordination of information gathering.
    There are several possible reasons why trucking firms may
experience difficulty gathering or interpreting information about fuel-
saving technologies. It may be difficult for truck drivers and fleet
operators to separate the individual effects of various technologies
and operating strategies from one another, particularly when they tend
to be used in conjunction. It may also be difficult for truck operators
to assess the applicability of even objective and reliable test results
to their own specific vehicle configurations and operating practices;
at the same time, the effects of specific technologies or operating
practices may vary with geography, season of the year, or other
factors. In highly competitive markets, any firm that conducts tests of
fuel efficiency is unlikely to share results with other firms. If so,
then cost-effective technological improvements may not be adopted
because they cannot be reliably distinguished from inefficient
technologies.
    To some extent, information about the effectiveness of some
selected technologies does exist, and it suggests that some
technologies appear to be very cost-effective in some situations. The
SmartWay Transport Partnership is a complementary partnership between
EPA and the freight goods industry (shippers, truck and rail carriers,
and logistics companies) whose aim is to provide better information on
fuel-efficient, low-carbon technologies and operational practices to
help accelerate their deployment. SmartWay initially focused on
evaluating and testing technologies for use in over-the-road class 8
tractor-trailers, commonly operated by the large, national trucking
fleets. For this reason, more information is available about the
configuration and operation of these types of trucks. Many of the
technologies that SmartWay selected for evaluation can also save fuel
and reduce greenhouse gas emissions in other types of trucks and
trucking operations. However, due to the wide diversity among other
types of trucks and truck operations, and lack of precise information
about the effectiveness of technologies in each one of these types of
truck and trucking operations, it is difficult for the program to
provide good information that is specific to each company. This makes
it much more challenging to improve market confidence in fuel-saving
technologies for these other truck types in the same way that SmartWay
has done with its existing partners. SmartWay will continue to serve as
a test bed for emerging technologies and as a conduit for technical
information by developing and sharing information on other types of
medium- and heavy-duty vehicles, helping to build market confidence in
innovative financial, technical and operational solutions for medium-
and heavy-duty vehicles across the freight goods industry, and
promoting retrofit fuel-saving technologies within the existing legacy
fleet. Information provision, such as the efforts of the SmartWay
program, is a direct, non-regulatory approach to addressing the problem
of the availability and reliability of results, as long as truck
purchasers are able and willing to act on the information.
    While its effect on information is indirect, we expect the
requirement for the use of new technologies included in this proposal
will circumvent these information issues, resulting in their adoption,
thus providing more readily available information about their benefits.
The agencies appreciate, however, that the diversity of truck uses,
driving situations, and driver behavior willl lead to variation in the
fuel savings that individual trucks or fleets experience from using
specific technologies.
(2) Information Issues in the Resale Market
    In addition to issues in the new vehicle market, a second
hypothesis for why trucking companies may not adopt what appear to be
cost-effective technologies to save fuel is that the resale market may
not reward the addition of fuel-saving technology to vehicles
adequately to ensure their original purchase by new truck buyers. This
inadequate payback for users beyond the original owner may contribute
to the short payback period that new purchasers appear to expect.\369\
The agencies seek data and information on the extent to which costs of
fuel-

saving equipment can be recovered in the resale truck market.
---------------------------------------------------------------------------

    \369\ See NAS 2010, Note 111, at p. 188.
---------------------------------------------------------------------------

    Some of this unwillingness to pay for fuel-saving technology may be
due to the extension of the information problems in the new vehicle
market into resale markets. Buyers in the resale market have no more
reason to trust information on fuel-saving technologies than buyers in
the original market. Because actual fuel economy of trucks on the road
depends on many factors, including geography and driving styles or
habits, even objective sources such as logs of truck performance for
used vehicles may not provide reliable information about the fuel
economy that potential purchasers of used trucks will experience.
    A related possibility is that vehicles will be used for different
purposes by their second owners than those for which they were
originally designed. For instance, a vehicle originally purchased for
long hauls might be used by its second owner instead for regional or
intrastate trips, in which case some of the fuel-saving measures that
proved effective in its original use may not be equally effective in
these new uses. If information were more widely available and reliable,
then purchasers in the resale market would seek vehicles with
technologies that best suited their purposes, and buyers would be
matched with sellers so that used vehicles would be used primarily for
purposes in which their fuel-saving technologies were most valuable.
    It is also possible, though, that the fuel savings experienced by
the secondary purchasers may not match those experienced by their
original owners if the optimal secondary new use of the vehicle does
not earn as many benefits from the technologies. In that case, the
premium for fuel-saving technology in the secondary market should
accurately reflect its value to potential buyers participating in that
market, even if it is lower than its value in the original market, and
the market has not failed. Because the information necessary to
optimize use in the secondary market may not be readily available or
reliable, however, buyers in the resale market may have less ability
than purchasers of new vehicles to identify and gain the advantages of
new fuel-saving technologies, and may thus be even less likely to pay a
premium for them.
    For these reasons, purchasers' willingness to pay for fuel-economy
technologies may be even lower in the resale market than in the
original equipment market. Even when fuel-saving technologies will
provide benefits in the resale markets, purchasers of used vehicles may
not be willing to compensate their original owners fully for their
remaining value. As a result, the purchasers of original equipment may
expect the resale market to provide inadequate appropriate compensation
for the new technologies, even when those technologies would reduce
costs for the new buyers. This information issue may partially explain
what appears to be the very short payback periods required for new
technologies in the new vehicle market.
(3) Split Incentives in the Medium- and Heavy-Duty Truck Industry
    A third hypothesis explaining the energy paradox as applied to
trucking involves split incentives. When markets work effectively,
signals provided by transactions in one market are quickly transmitted
to related markets and influence the decisions of buyers and sellers in
those related markets. For instance, in a well-functioning market
system, changes in the expected future price of fuel should be
transmitted rapidly to those who purchase trucks, who will then
reevaluate the amount of fuel-saving technology to purchase for new
vehicles. If for some reason a truck purchaser will not be directly
responsible for future fuel costs, or the individual who will be
responsible for fuel costs does not decide which truck characteristics
to purchase, then those price signals may not be transmitted
effectively, and incentives can be described as ``split.''
    One place where such a split may occur is between the owners and
operators of trucks. Because they are generally responsible for
purchasing fuel, truck operators have strong incentives to economize on
its use, and are thus likely to support the use of fuel-saving
technology. However, the owners of trucks or trailers are often
different from operators, and may be more concerned about their
longevity or maintenance costs than about their fuel efficiency when
purchasing vehicles. As a result, capital investments by truck owners
may be channeled into equipment that improves vehicles' durability or
reduces their maintenance costs, rather than into fuel-saving
technology. If operators can choose freely among the trucks they drive,
competition among truck owners to employ operators would encourage
owners to invest in fuel-saving technology. However, if truck owners
have more ability to choose among operators, then market signals for
improved fuel savings that would normally be transmitted to truck
owners may be muted.
    Anecdotal information about large truck fleets suggests that, even
within a company, the office or department responsible for truck
purchases is often different from that responsible for purchasing fuel.
Therefore, the employees who purchase trucks may have strong incentives
to lower their initial capital cost, but not equally strong incentives
to lower operating costs.
    Single-wide tires, which save fuel and allow more payload (thus
increasing revenue), offer another example of split incentives. They
require a different driving style; those concerned about retaining
drivers may resist their purchase, because drivers may not like the
slightly different ``feel'' of wheel torque needed. Maintenance and
repair staff may resist them because the tires may not be as available
as they would like on the road, or they may need to change road service
providers. Finally, those who resell the trucks may believe that the
resale market will not value the tires. While financial pressures
should provide incentives for greater coordination, especially when
fuel costs are a large share of operating costs, it may be difficult
institutionally to change budgeting procedures and to coordinate across
offices. Thus, even within a company incentives for fuel savings may
not be fully transmitted to those responsible for purchasing decisions.
    In addition, the NAS report notes that split incentives can arise
between tractor and trailer operators.\370\ Trailers affect the fuel
efficiency of shipping, but trailer owners do not face strong
incentives to coordinate with truck owners. Although some trucking
fleets own or lease their own trailers, a significant part of the
trucking business is ``drop and hook'' service, in which trucking
fleets pick up and drop off trailers and containers. These trailers and
containers can belong to shippers, other trucking companies, leasing
companies, or ocean-going vessel lines, in which cases their owners may
not face strong incentives to economize on fuel consumption by tractor
operators. Though tractor operators should, in principle, have some
ability to arrange tractor-trailer combinations that provide increased
fuel efficiency, the value of the resulting fuel savings may be small
relative to the complexity and cost involved. EPA and NHTSA are not
proposing to regulate trailers in this proposal.
---------------------------------------------------------------------------

    \370\ See NAS 2010, Note 111, at p. 182.
---------------------------------------------------------------------------

    By itself, information provision may be inadequate to address the
potential underinvestment in fuel economy

resulting from such split incentives. In this setting, regulation may
contribute to fuel savings that otherwise may be difficult to achieve.
    The agencies seek evidence and data on the extent to which split
incentives affect purchasing choices in truck markets. For example, are
trailer buyers that do not own their own tractors less likely to
purchase aerodynamic trailers than those that purchase and drive both
tractors and trailers?
(4) Uncertainty About Future Cost Savings
    Another hypothesis for the lack of adoption of seemingly fuel
saving technologies may be uncertainty about future fuel prices or
truck maintenance costs. When purchasers have less than perfect
foresight about future operating expenses, they may implicitly discount
future savings in those costs due to uncertainty about potential
returns from investments that reduce future costs. In contrast, the
immediate costs of the fuel-saving or maintenance-reducing technologies
are certain and immediate, and thus not subject to discounting. In this
situation, both the expected return on capital investments in higher
fuel economy and potential variance about its expected rate may play a
role in a firm's calculation of its payback period on such investments.
    In the context of energy efficiency investments for the home,
Metcalf and Rosenthal (1995) and Metcalf and Hassett (1995) observe
that households weigh known, up-front costs that are essentially
irreversible against an unknown stream of future fuel savings.\371\
Uncertainty about the value of future energy savings may make risk-
averse households reluctant to invest in energy-saving technologies
that appear to offer attractive economic returns. These authors find
that it is possible to replicate the observed adoption rates for
household energy efficiency improvements by incorporating the effect of
uncertainty about the value of future energy savings into an empirical
model. Notably, in this situation, requiring households to adopt
technologies more quickly may make them worse off by imposing
additional risk on them.
---------------------------------------------------------------------------

    \371\ Metcalf, G., and D. Rosenthal (1995). ``The `New' View of
Investment Decisions and Public Policy Analysis: An Application to
Green Lights and Cold Refrigerators,'' Journal of Policy Analysis
and Management 14: 517-531. Hassett and Metcalf (1995). ``Energy Tax
Credits and Residential Conservation Investment: Evidence from Panel
Data'' Journal of Public Economics 57 (1995): 201-217. Metcalf, G.,
and K. Hassett (1999). ``Measuring the Energy Savings from Home
Improvement Investments: Evidence from Monthly Billing Data.'' The
Review of Economics and Statistics 81(3): 516-528.
---------------------------------------------------------------------------

    Greene et al. (2009) also find support for this explanation in the
context of light-duty fuel economy decisions: a loss-averse consumer's
expected net present value of increasing the fuel economy of a
passenger car can be very close to zero, even if a risk-neutral
expected value calculation shows that its buyer can expect significant