which was determined by the cleanout results obtained from the baseline
testing on the vehicles as-received.

 Table IV-8--Summary of Mixed Model Results for Emission Reductions When Going From 28 ppm to 5 ppm Sulfur Gasoline, Adjusted for In-Use Sulfur Loading
                                                        (Mileage Accumulation) Where Appropriate
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                NOX+NMOG (p-
                                           NOX (p-value)   THC (p-value)   CO (p-value)   NMHC (p-value)   CH4 (p-value)      value)           PM\a\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bag 1...................................           10.7%         \b\8.5%         \b\7.5%            7.5%        \b\13.9%             N/A  ..............
                                                (0.0033)        (0.0382)        (0.0552)      (< 0.0001)       (<0.0001)
Bag 2...................................           59.2%           48.8%            -\a\        \b\44.8%           49.9%             N/A  ..............
                                               (<0.0001)       (<0.0001)                        (0.0260)       (<0.0001)
Bag 3...................................           62.1%           40.2%           20.1%           49.9%           29.2%             N/A  ..............
                                               (<0.0001)       (<0.0001)       (<0.0001)       (<0.0001)       (<0.0001)
FTP Composite...........................        \b\23.0%        \b\13.0%        \b\11.9%        \b\10.6%        \b\25.8%           17.3%  ..............
                                                (0.0180)        (0.0027)        (0.0378)        (0.0032)       (<0.0001)        (0.0140)
Bag 1-Bag 3.............................            -\a\            5.2%            4.3%            5.1%            4.6%             N/A  ..............
                                                                (0.0063)        (0.0689)        (0.0107)        (0.0514)
--------------------------------------------------------------------------------------------------------------------------------------------------------
\a\ Sulfur level not significant at [alpha] = 0.10. For THC Bag 1 and CH4 Bag 1, because the effect of clean-out was not statistically significant, the
  reduction estimates are based on the estimates of least squares means.
\b\ Model with significant sulfur and mileage interaction term.

    Major findings from this study include:
     Reversible sulfur loading is occurring in the in-use fleet
of Tier 2 vehicles and has a measureable effect on emissions of
NOX, hydrocarbons, and other pollutants of interest.
     The effectiveness of high speed/load procedures in
restoring catalyst efficiency is limited when operating on higher
sulfur fuel.
     Reducing fuel sulfur levels from current levels to levels
in the range of the proposed gasoline sulfur standards would be
expected to achieve significant reductions in emissions of
NOX, hydrocarbons, and other pollutants of interest in the
in-use fleet.
    The overall reductions found in this study are in agreement with
other low sulfur studies conducted on Tier 2 vehicles. The magnitude of
NOX and HC reductions found in this study when switching
from 28 ppm to 5 ppm fuel are consistent with those found in MSAT and
Umicore studies mentioned above. For further details regarding the Tier
2 In-Use Gasoline Sulfur Effects Study, see the draft report on this
work.\249\
---------------------------------------------------------------------------

    \249\ U.S. EPA. 2013. ``The Effects of Fuel Sulfur Level on
Emissions from Tier 2 Vehicles In-Use.'' EPA-420-D-13-003. Available
in the docket for this rule.
---------------------------------------------------------------------------

c. Fuel Sulfur Impacts on Vehicles at the Proposed Tier 3 Levels
    As discussed in previous sections, the Tier 3 Program would reduce
fleet average NMOG+NOX emissions by over 80 percent. The
feasibility of the proposed 30 mg/mi NMOG+NOX fleet average
standard depends on a degree of emissions control from exhaust catalyst
systems that will require gasoline at 10 ppm sulfur or lower. The most
likely control strategies would involve using exhaust catalyst
technologies and powertrain calibration primarily focused on reducing
cold-start emissions of NMOG and on both cold-start and warmed-up
(running) emissions of NOX. An important part of this
strategy, particularly for larger vehicles having greater difficulty
achieving cold-start NMOG emissions control, would be to reduce
NOX emissions to near-zero levels. This would allow
sufficient NMOG compliance margin to allow vehicles to meet the
combined NMOG+NOX emissions standards for their full useful
life.
    Achieving the proposed Tier 3 emission standards would require very
careful control of the exhaust chemistry and exhaust temperatures to
ensure high catalyst efficiency. The impact of sulfur on OSC components
in the catalyst makes this a challenge even at relatively low (10 ppm)
gasoline sulfur levels. NOX conversion by exhaust catalysts
is strongly influenced by the OSC components like ceria. Ceria
sulfation may play an important role in the degradation of
NOX emission control with increased fuel sulfur levels
observed in the MSAT, Umicore and EPA Tier 2 In-Use Gasoline Sulfur
Effects studies.\250\
---------------------------------------------------------------------------

    \250\ Heck, R.M., Farrauto, R.J. (2002). Chapter 6: Automotive
Catalyst in Catalytic Air Pollution Control, 2nd Edition. John Wiley
and Sons, Inc.
---------------------------------------------------------------------------

    Light-duty vehicles certified to CARB SULEV and federal Tier 2 Bin
2 exhaust emission standards accounted for approximately 3.1 percent
and 0.4 percent, respectively of vehicle sales for MY2009. Light-duty
vehicles certified to SULEV under LEV II are more typically certified
federally to Tier 2 Bin 3, Bin 4 or Bin 5, and vehicles certified to
SULEV and Tier 2 Bins 3-5 comprised approximately 2.5 percent of sales
for MY2009. In particular, nonhybrid vehicles certified in California
as SULEV are not certified to federal Tier 2 Bin 2 emissions standards
even though the numeric limits for NOX and NMOG are shared
between the California LEV II and federal Tier 2 programs for SULEV and
Bin 2. Confidential business information shared by the auto companies
indicate that the primary reason is an inability to demonstrate
compliance with SULEV/Bin 2 emission standards after vehicles have
operated in-use on gasoline with greater than 10 ppm sulfur and with
exposure to gasoline up to the Tier 2 80 ppm gasoline sulfur cap. While
vehicles certified to the SULEV and Tier 2 Bin 2 standards both
demonstrate compliance using certification gasoline with 15-40 ppm
sulfur content, in-use compliance of SULEV vehicles in California
occurs after operation on gasoline with an average of 10 ppm sulfur and
a maximum cap of 30 ppm sulfur while federally certified vehicles
operate on gasoline with an average of 30 ppm sulfur and a maximum cap
of 80 ppm sulfur. Although the SULEV and Tier 2 Bin 2 standards are
numerically equivalent, the increased sulfur exposure of in-use
vehicles certified under the federal Tier 2 program results in a need
for a higher emissions compliance margin to take into account the
impact of in-use gasoline sulfur on full useful life vehicle emissions.
As a result, vehicles certified

to California SULEV typically certify to emissions standards under the
federal Tier 2 program that are 1-2 certification bins higher (e.g.,
SULEV certified federally as Tier 2 Bin 3 or Bin 4) in order to ensure
in-use compliance with emissions standards out to the full useful life
of the vehicle when operating on higher-sulfur gasoline.
    Emissions of vehicles certified to the SULEV standard of the
California LEV II program, or the equivalent Tier 2 Bin 2 standards,
can provide some insight into the impact of fuel sulfur on vehicles at
the very low proposed Tier 3 emissions levels. Vehicle testing by
Toyota of LEV I, LEV II ULEV and prototype SULEV vehicles showed larger
percentage increases in NOX and HC emissions for SULEV
vehicles as gasoline sulfur increased from 8 ppm to 30 ppm, as compared
to other LEV vehicles they tested. Testing of a SULEV-certified PZEV
vehicle by Umicore showed a pronounced, progressive trend of increasing
NOX emissions (referred to as ``NOX creep'') when
switching from a 3 ppm sulfur gasoline to repeated, back-to-back FTP
tests using 33 ppm sulfur gasoline.\251\ The PZEV Chevrolet Malibu,
after being aged to an equivalent of 150,000 miles, demonstrated
emissions at a level equivalent to the compliance margin for the Tier 3
Bin 30 NMOG+NOX standard when operated on 3 ppm sulfur fuel
and for at least one FTP test after switching to 33 ppm certification
fuel. Following operation over 2 FTP cycles on 33 ppm sulfur fuel,
NOX emissions alone were more than double the proposed Tier
3 30 mg/mi NMOG+NOX standard.\252\ This represents a
NOX percentage increase that is approximately 2-3 times of
what has been reported for similar changes in fuel sulfur level for
Tier 2 and older vehicles over a similar difference in fuel
sulfur.253 254 There are no LDTs larger than LDT2 and no
larger non-hybrid LDVs. We expect that additional catalyst
technologies, for example increasing catalyst surface area (volume or
substrate cell density) and/or increased PGM loading, would need to be
applied to larger vehicles in order to achieve the catalyst
efficiencies necessary to comply with the proposed Tier 3 standards.
Any sulfur impact on catalyst efficiency would have a larger impact on
vehicles and trucks that rely more on very high catalyst efficiencies
in order to achieve very low emissions.
---------------------------------------------------------------------------

    \251\ Heck, R.M., Farrauto, R.J. (2002). Chapter 6: Automotive
Catalyst in Catalytic Air Pollution Control, 2nd Edition. John Wiley
and Sons, Inc.
    \252\ Ball, D., Clark, D., Moser, D. (2011). Effects of Fuel
Sulfur on FTP NOX Emissions from a PZEV 4 Cylinder
Application. SAE Technial Paper No. 2011-01-0300.
    \253\ Butler, A. and Choi, D. (2012). The Effects of Fuel Sulfur
Level on Emissions In-Use Tier 2 Vehicles. Found in the docket, EPA-
HQ-OAR-2011-0135.
    \254\ Shapiro, E. (2009). National Clean Gasoline--An
Investigation of Costs and Benefits. Published by the Alliance of
Automobile Manufacturers.
---------------------------------------------------------------------------

    The negative impact of gasoline sulfur on catalytic activity and
the resultant loss of exhaust catalyst effectiveness to chemically
reduce NOX and oxidize NMOG and air toxic emissions occurs
across all vehicle categories. However, the impact of gasoline sulfur
on NOX emissions control of catalysts in the fully-warmed-up
condition is particularly of concern for larger vehicles (the largest
LDVs and LDT3s, LDT4s, and MDPVs). Manufacturers face the most
significant challenges in reducing cold-start NMOG emissions for these
vehicles. Because of the need to reach near-zero NOX levels,
any significant degradation in NOX emissions control over
the useful life of the vehicle would likely prevent some if not most
larger vehicles from reaching a combined NMOG+NOX low enough
to comply with the 30 mg/mi fleet-average standard. These vehicles
represent a sufficiently large segment of light-duty vehicle sales now
and in the foreseeable future that their emissions could not be offset
(and thus the fleet-average standard achieved) by certifying vehicles
to bins below the fleet average. Any degradation in catalyst
performance due to gasoline sulfur would reduce or eliminate the margin
necessary to ensure in-use compliance with the proposed Tier 3
emissions standards. Certifying to a useful life of 150,000 miles
versus the current 120,000 miles would further add to manufacturers'
compliance challenge for Tier 3 large light trucks (See Section IV.7.b
below for more on the useful life requirements.)
d. Gasoline Sulfur Control Required To Meet Tier 3 Emissions Standards
    The impact of gasoline sulfur poisoning on exhaust catalyst
performance and the relative stringency of the Tier 3 standards,
particularly for larger vehicles and trucks, when considered together
make a compelling argument for the virtual elimination of sulfur from
gasoline. As discussed in Section V.A.2, the proposed 10-ppm standard
for sulfur in gasoline represents the lowest practical limit from a
standpoint of fuel production, handling and transport. While lowering
gasoline sulfur to levels below 10 ppm would further help ensure in-use
vehicle compliance with the Tier 3 standards, the Agency believes that
a gasoline sulfur standard of 10 ppm would allow compliance by
gasoline-fueled engines with a national fleet average of 30 mg/mi
NMOG+NOX. The level of the proposed Tier 3 standards was
considered in light of a 10-ppm average sulfur level for gasoline. Not
only should a 10-ppm sulfur standard enable vehicle manufacturers to
certify their entire product line of vehicles to the Tier 3 fleet
average standards, but based on the results of testing both Tier 2
vehicles and SULEV vehicles as discussed above, reducing gasoline
sulfur to 10 ppm should enable these vehicles to maintain their
emission performance in-use over their full useful life. It is
important to note that while the preceding discussion focused on
gasoline sulfur control, spark ignition engines operating on other
fuels (i.e., CNG, LPG, E85) and utilizing a three way catalyst systems
for control of emission are similarly affected by the sulfur levels in
the fuel. We invite comment on all aspects of our analysis of gasoline
sulfur effects and our conclusions, especially comments that include
any additional relevant testing data.
7. Other Provisions
a. Early Credits
    The California LEV III program is scheduled to begin at least two
model years earlier than the proposed federal Tier 3 program.\255\ As
stated earlier, EPA proposes to implement the Tier 3 standards in MY
2017, for vehicles 6,000 lbs GVWR and less, and in MY 2018 for vehicles
over 6,000 lbs GVWR. As a result, LEV III vehicles sold in California
beginning in MY 2015 will be required to meet a lower fleet average
NMOG+NOX level than the federal fleet is meeting at that
time. In addition, the California NMOG+NOX standards will
continue to decline resulting in the gap growing between the current
federal program and LEV III. The early credit program we are proposing
is designed to accomplish three goals: (1) Encourage manufacturers to
produce a cleaner federal fleet earlier than otherwise required; (2)
provide needed flexibility to the manufacturers to facilitate the
``step down'' from the current Tier 2 Bin 5 fleet average required in
MY 2016 to the LEV III-based declining fleet average in MY 2017; and
(3) create a Tier 3 program that is equivalent in stringency to the LEV
III program such that manufacturers will be able to produce a 50-state
fleet at the earliest opportunity.
---------------------------------------------------------------------------

    \255\ The LEV III program as approved by the California Air
Resources Board, January 2012.
---------------------------------------------------------------------------

    The first provision that we are proposing to address these goals is
to allow manufacturers to generate early federal credits against the
current Tier 2

Bin 5 requirement \256\ in MYs 2015 and 2016 for vehicles under 6,000
lbs GVWR and MYs 2016 and 2017 for vehicles greater than 6,000 lbs
GVWR. (Early credits would only be available for manufacturers
complying under the primary program (declining fleet average), not the
alternative phase-in approach (Section IV.A.3.a above). In order to
generate these credits, manufacturers would sum the NMOG and
NOX certification standards for each federally certified
Tier 2 vehicle and calculate an NMOG+NOX fleet average.
Credits would be based on the difference between the new, cleaner,
fleet average and the Tier 2 Bin 5 requirement (160 mg/mi total of NMOG
and NOX). We expect that manufacturers could accomplish this
by certifying existing Tier 2 vehicles to a lower fleet average, mainly
for the higher bins as the current sulfur content in gasoline would
preclude them from certifying the cleanest bins federally (Our
analysis, presented in Section IV.A.5 above and Chapter 1 of the draft
RIA, shows that many vehicles currently certified to Tier 2 Bin 5 could
likely be certified to a lower bin with some reduction in compliance
margin; e.g., from Bin 5 to Bin 4 or Bin 3.) We expect to realize early
environmental benefits, as the result of a cleaner federal fleet, that
justify the credits generated.
---------------------------------------------------------------------------

    \256\ Tier 2 standards are not set in the form of
NMOG+NOX. The equivalent Tier 2 Bin 5 fleet average in
NMOG+NOX terms would be equal to 160 mg/mi (90 mg/mi NMOG
+ 70 mg/mi NOX).
---------------------------------------------------------------------------

    We believe that this provision would help us realize both our first
and our second goals. For example, a manufacturer certifying their
federal fleet to Tier 2 Bin 4 would earn 50 mg/mi of
NMOG+NOX credits per vehicle (i.e., 160 mg/mi minus 110 mg/
mi) which should encourage manufacturers to certify a cleaner federal
fleet and provide ample opportunity for credit generation to facilitate
the ``step down'' in stringency. However, if we allowed excessive early
credits to be generated it could allow manufacturers to delay their
federal compliance with the same fleet average as California for
several years. This would be in direct conflict with our third goal of
creating a program of equal stringency to the California program as
early as possible. In order to address this concern we are proposing
that the application of the early federal credits be constrained under
the following conditions:
     Early federal credits generated under the provision
described above could be used without limitation in MY 2017.
     Credits used for compliance in MY 2018 and beyond would be
capped at an amount equal to the lesser of the manufacturer's federal
credits as calculated above or the manufacturer's LEV III credits
multiplied by the ratio of 50-state sales to California only sales.
Calculation of these credits would account for the fact that some LEV
III credits may have begun to expire and would no longer be eligible as
a basis for Tier 3 early credits.
    By capping the available federal credits we believe that the two
programs, LEV III and Tier 3 would be at parity starting in 2018 MY. In
addition, because the number of federal early credits that could be
used would be based on the number of LEV III credits that the
manufacturer had generated, there may be additional motivation for
manufacturers to over-perform in California during the initial model
years.
    We are proposing that early credit life be limited to 5 years with
no discounting, consistent with the California LEV II and LEV III
programs and similar to the basic credit carry-forward provisions of
the recent light-duty and heavy-duty greenhouse gas rules. We are not
proposing any carry-over of Tier 2 credits for use in the Tier 3
program. We seek comment on the 5-year credit life in the context of
the programs goals of harmonization with California LEV III and whether
the added flexibility would be advantageous relative to any added
burden associated with corresponding record retention requirements.
b. Useful Life
    The ``useful life'' of a vehicle is the period of time, in terms of
years and miles, during which a manufacturer is responsible for the
vehicle's emissions performance.\257\ For LDVs and LDTs (including
MDPVs) under the Tier 2 program, there have historically been both
``full useful life'' values, approximating the average life of the
vehicle on the road, and ``intermediate useful life'' values,
representing about half of the vehicle's life. For the Tier 3 program,
we are proposing several changes to the current useful life provisions
that are appropriate to the proposed standards described above.
---------------------------------------------------------------------------

    \257\ The useful life of the vehicle should not be confused with
the vehicle's emissions warranty. The useful life value is relevant
for certification and in-use compliance purposes; the emissions
warranty relates to the period during which the manufacturer is
obligated to repair or replace failing emission control equipment on
a properly maintained vehicle.
---------------------------------------------------------------------------

    Every vehicle manufacturer with which the EPA has met has expressed
the desire for a single national vehicle fleet and has indicated an
ability and willingness to certify their vehicles to a 150,000 mile, 15
year full useful life in support of that goal, since the LEV III
program would apply a single 150,000 mile, 15 year useful life value
for all of the new standards. However, the CAA, written at a time when
vehicles did not last as long as today, precludes EPA from requiring a
useful life value longer than the 120,000 mile (and 10 or 11 year, as
applicable) value set in Tier 2, for all LDVs and for LDTs up to 3,750
lbs LVW and up to 6,000 lbs GVWR (LDT1s). For vehicles heavier than
these limits (i.e., LDT2s, 3s, 4s, as well as MDPVs, representing a
large fraction of the light-duty fleet) we are proposing a 150,000
mile, 15 year useful life value. For the lighter vehicles, we are
proposing to continue to apply the 120,000 mile (and 10 or 11 year, as
applicable) full useful life requirement from the Tier 2 program.
Numerically, we are proposing 120,000 mile useful life
NMOG+NOX standards that are 85 percent of the respective
NMOG+ NOX 150,000 mile standards. (See Chapter 1 of the
draft RIA for a description of our analysis of this relationship.) For
the lighter vehicles, we propose that manufacturers be allowed to
choose to certify to either useful life value in complying with the
proposed fleet average and per-vehicle standards.\258\ A manufacturer
choosing to comply with the 120,000 mile useful life standards for any
of their lighter vehicles would demonstrate compliance with the
numerically lower fleet-average NMOG+ NOX standards for all
LDV and LDT1 families. Standards for all other pollutants \259\ would
remain the same regardless of whether compliance was at the 120,000
mile or the 150,000 mile useful life periods. If a vehicle manufacturer
chose to comply with the 120,000 mile useful life standards for their
lighter vehicles, it would be required to separately demonstrate that
its larger vehicles complied with the 150,000 mile fleet average
standards.
---------------------------------------------------------------------------

    \258\ CARB has stated that they do not expect to accept vehicles
certified under the federal Tier 3 program to a 120,000 mile useful
life value for California certification, and thus for meeting
California's fleet average NMOG+NOX standards.
    \259\ PM, CO, and HCHO
---------------------------------------------------------------------------

    Except for vehicles not required to meet a 150,000 miles useful
life and for which a manufacturer chose to apply the 120,000 mile
useful life value, we propose that manufacturers be required to certify
vehicles to the 150,000 mile useful life beginning with the first model
year that a vehicle model is certified to the FTP NMOG+NOX
Bin 70 or lower. This useful-life requirement

would apply beginning in MY 2017. Beginning in MY 2020, all vehicles
would need to certify to the 150,000 mile useful life, regardless of
NMOG+NOX certification bin, unless they are allowed and the
manufacturer has chosen to remain at 120,000 mile useful life. (Note
that the timing of the requirement to certify on the new test fuel
would follow the same approach as for the useful life requirement
(i.e., based on the first year a model is certified to Bin 70 or below)
as described in Section IV.A.7.c below.)
    We request comment on the proposed useful life provisions,
including the 85 percent factor we propose to use to establish the
standards for the 120,000 mile useful life.
c. Test Fuels
    We recognize that test fuels are an important element of a national
program. Vehicle manufacturers have emphasized the desire to reduce
test burden by producing one vehicle that is tested to a single test
procedure and a single fuel and meets both California and federal
requirements. Although we have been able to reasonably align the
proposed Tier 3 program with the LEV III program in most key respects,
we recognize that there would still exist some differences in emissions
performance between vehicles operated on the LEV III and Tier 3
certification fuels. The largest differences between the two fuels are
the amount of ethanol they contain and the Reid Vapor Pressure (RVP).
The proposed Tier 3 NMOG+NOX standards assume operation on
federal certification fuel.
    We propose that manufacturers begin to certify vehicles on the new
Tier 3 fuels \260\ beginning with the first model year that a vehicle
model is certified to the FTP NMOG+NOX Bin 70 or lower,
independent of its useful life. The new-fuel requirement would apply
beginning in MY 2017. Beginning in MY 2020, all gasoline-fueled models
would need to certify on the new fuel, regardless of their
certification bin.\261\ As discussed in Section IV.A.7.b above,
manufacturers would also need to apply the 150,000 mile useful life
value to these same vehicles as they begin to be certified to Bin 70
and lower.
---------------------------------------------------------------------------

    \260\ This includes fuels used for low temperature and high
altitude testing and durability requirements. See Section IV.D
below.
    \261\ Diesel fueled and alternative fueled vehicles would
continue to test on the fuels used under the Tier 2 program.
---------------------------------------------------------------------------

    During the transition period from Tier 2 fuel to the new Tier 3 and
LEV III fuels, manufacturers have indicated a substantial workload
challenge of developing and certifying a vehicle to the two new fuels
simultaneously. To address this potential workload and certification
challenge, we propose that vehicles certified in MY 2015 through 2019
to California LEV III standards using California LEV III certification
fuels and test procedures could be used for certifying to EPA
standards. (For example, for MY 2015 and 2016, EPA would consider such
vehicles to be Tier 2 vehicles, although they could be tested on
California LEV III fuel.\262\ Similarly, for MY 2017 through 2019, EPA
would consider such vehicles to be Interim Tier 3 vehicles, although
they could be tested on California LEV III fuel.) For these vehicles
only, we would not perform or require in-use exhaust testing on Tier 3
fuel.
---------------------------------------------------------------------------

    \262\ Because the Tier 2 program has NOX fleet
average standards (instead of the NMOG+NOX fleet average
standard of LEV III and Tier 3), manufacturers certifying to LEV III
standards in MY 2015 and 2016 would not include such vehicles in
their Tier 2 NOX fleet average calculation. Tier 2
provisions that are not a part of the California program would still
apply. For example, high altitude testing, which is only required in
the federal program, would still need be performed on federal Tier 2
fuel.
---------------------------------------------------------------------------

    California does not have fuel specifications for high altitude
testing or cold CO and hydrocarbon testing. For this reason, we are
proposing that for vehicles that manufacturers choose to certify using
LEV III fuel and test procedures, they can use test fuels meeting
either Tier 2 or Tier 3 fuel specifications to comply with these
federal-only requirements. We would perform in-use testing for these
vehicles on the same fuel as selected by the manufacturer at
certification.
    Certifications after MY 2019, however, would be required to use the
Tier 3 fuel and carry-over certifications using LEV II, LEV III or Tier
2 certification fuels would not be allowed after MY 2019. CARB has
indicated that they would accept Tier 3 test data (on federal
certification fuel) to obtain a California certificate as early as MY
2015. In this manner manufacturers should be able to avoid compliance
testing on more than one fuel as vehicles certified to LEV III using
federal certification fuel could obtain Final Tier 3 status.\263\
---------------------------------------------------------------------------

    \263\ That is, a manufacturer that certifies a vehicle to LEV
III in MY 2015 and MY 2016.
---------------------------------------------------------------------------

d. High Altitude Requirements
    FTP emission standards are historically designed to be applicable
at all altitudes. Under Tier 2, the same FTP emission bin standards
applied to vehicles tested at both low and high-altitude. However,
fundamental physical challenges exist at high altitude resulting in
typically higher emissions during cold starts compared with starts at
lower altitudes (i.e., sea level). This expected increase in emissions
is primarily due to the lower air density at higher altitudes. Due to
the lower air density, the needed volume of the hot combustion exhaust
required to quickly heat the catalyst in the first minute after a cold
start is reduced. As a result, catalyst light-off is delayed and cold
start emissions increase. Vehicles under the Tier 2 program typically
had sufficient compliance margins to absorb this increase in emissions
during testing under high-altitude conditions. However, given the near-
zero standards we are proposing in Tier 3, vehicles will have less
compliance margin with which to address the issue.
    Under the Tier 3 program, we expect that the emission control
technologies selected for low altitude performance would also provide
very significant emission control at high altitude.\264\ However, as
explained above, unique emission challenges exist with operation at
higher altitude. The stringency of the Tier 2 standards is such that
manufacturers comply with the same standards at all altitudes without
the need to design their emission control strategies specifically for
the more challenging high altitude operation. The Tier 3 stringency may
not allow manufacturers emission control strategies at lower altitude
to maintain sufficient compliance margin when tested at higher
altitude, therefore requiring manufacturers to design their emission
controls specifically for higher altitude.
---------------------------------------------------------------------------

    \264\ High-altitude conditions means a test altitude of 1,620
meters (5,315 feet). Low altitude conditions means a test altitude
less than 549 meters (1,800 feet).
---------------------------------------------------------------------------

    To avoid requiring special high-altitude emission control
technologies, we propose to allow manufacturers the limited relief of
complying with the next less-stringent bin for testing at high altitude
for vehicles certified at sea level to Bin 20, 30, and 50 (e.g.,
certifying to Bin 50 for testing at high altitude versus Bin 30 at sea
level). For vehicles certified at sea level to Bins 70 and 125, 35 mg/
mi of relief will be provided. No relief is proposed for Bin 160.
    We do not believe that the impact of the fairly small fraction of
overall U.S. driving that occurs in high altitude locations warrants a
requirement for additional technologies to be applied specifically for
high-altitude conditions. In addition, this provision is intended to be
applicable to all Final Tier 3 vehicles for the duration of the Tier 3
program.

    While vehicles would need to meet the Tier 3 standards at all
intermediate altitudes, the question remains as to what the value of
the standard should be at a given intermediate altitude. We request
comment on both the level of the proposed high altitude standards and
the appropriate level of the standard at intermediate altitudes. In
particular, we seek comment on whether this could be addressed by
requiring that all emission control strategies remain in effect at
altitudes that are in between the specific altitudes used for high and
low altitude testing and that any altitude-related auxiliary emission
control device (AECD) must be identified by the manufacturer and
justified as not being defeat devices.

              Table IV-9--Proposed High Altitude Standards
------------------------------------------------------------------------
                                           Sea level FTP   Altitude FTP
                   Bin                     standard (mg/   standard (mg/
                                           mi NMOG+NOX)    mi NMOG+NOX)
------------------------------------------------------------------------
Bin 160.................................             160             160
Bin 125.................................             125             160
Bin 70..................................              70             105
Bin 50..................................              50              70
Bin 30..................................              30              50
Bin 20..................................              20              30
------------------------------------------------------------------------

e. Highway Test Standards
    Sustained high-speed operation can result in NOX
emissions that may not be represented on either the FTP or SFTP cycles.
Although we are not aware of any serious issues with this mode of
operation with current Tier 2 vehicles, we are interested in preventing
increases in these NOX emissions as manufacturers develop
new or improved engine and emission control technologies.
    For this reason, we are proposing that the same FTP
NMOG+NOX standards proposed above also apply on the Highway
Fuel Economy Test (HFET), which is performed as a part of GHG and Fuel
Economy compliance testing. Thus, the FTP NMOG+NOX standard
for the bin at which a manufacturer has chosen to certify a vehicle
would also apply on the HFET test. For example, if a manufacturer
certifies a vehicle to Bin 70, the vehicle's NMOG+NOX
performance over the HFET could not exceed 70 mg/mi. Manufacturers
would simply need to ensure that the same emission control strategies
implemented for the FTP and SFTP cycles were also effectively utilized
during the highway test cycle. We believe that this proposed
requirement would not require manufacturers to take any unique
technological action, would not add technology costs, and would not add
significantly to the certification burden. We request comment on this
proposed provision.
f. Interim 4,000 mile SFTP Standards
    During the period of the declining NMOG+NOX standards,
we are proposing that interim Tier 3 vehicles meet 4,000 mile SFTP
standards, consistent with the existing Tier 2 and LEV II program
requirements. The 4,000 mile standards are designed to prevent
excessive emission levels from a single vehicle or a single SFTP cycle,
which can occur if only a composite approach is taken. Under the Tier 3
program, the proposed composite standards would be fleet average
standards that would decline from 2017 until 2025, as described in
Section IV.A.4. While this approach is expected to result in fleet-wide
reductions in SFTP emissions during all years of the declining
standard, the level of the fleet average requirement during the initial
years provides an opportunity for backsliding of SFTP emissions on
individual vehicles or on individual SFTP cycles. We believe it is
appropriate to require any individual Interim Tier 3 vehicle to at a
minimum meet the same requirements under the Tier 2 and LEV II
programs. Table IV-10 below presents the proposed 4,000 mile SFTP
standards for interim Tier 3 vehicles.

        Table IV-10--Proposed 4,000 Mile SFTP Exhaust Standards for Interim Tier 3 Vehicles (Grams/mile)
----------------------------------------------------------------------------------------------------------------
         Vehicle category            US06 NMOG+NOX      US06 CO      SC03 NMOG+NOX      SC03 CO
--------------------------------------------------------------------------------------------------
LDV/LDT1..........................            0.14             8.0            0.20             2.7
LDT2..............................            0.25            10.5            0.27             3.5
LDT3..............................            0.4             10.5            0.31             3.5
LDT4..............................            0.6             11.8            0.44             4.0
----------------------------------------------------------------------------------------------------------------

    We believe that vehicles considered to be Final Tier 3 (i.e., they
meet the Tier 3 PM requirements, specifically the stringent SFTP PM
standards) will have sufficiently robust designs that the 4,000 mile
SFTP standards will no longer be necessary. Additionally, once the
program reaches the fully phased-in fleet average composite standard of
50 mg/mi in 2025, high SFTP emissions even on a limited portion of a
manufacturer's fleet should be effectively mitigated. We seek comment
on this proposed 4,000 mile SFTP provision.
g. Phase-In Schedule
    As described in Section IV.A.3, under the proposed Tier 3 program,
manufacturers would be required to certify each vehicle model to an FTP
bin, which would then be used to calculate the NMOG+NOX
fleet average of all of its vehicles. Manufacturers would also need to
determine the SFTP levels of each model and calculate the
NMOG+NOX fleet average for the SFTP requirements as
described in Section IV.A.4. These separate FTP and SFTP fleet average
calculations would satisfy one aspect of certification under the Tier 3
program, specifically the standards associated with each model year.
    As described in Sections IV.A.7.b and IV.A.7.c above, the longer
(150,000 mile) useful life value, as applicable, and the new Tier 3
certification fuel for exhaust testing would be implemented as
manufacturers certified vehicles to more stringent NMOG+NOX
standards, with the threshold to implement both of these provisions
being Bin 70. Beginning in MY 2017, any vehicle certified to Bin 70 or
lower would be required to be certified on Tier 3 test fuel. In
addition, any vehicle certified to Bin 70 or lower that would be
required to meet the longer 150,000 mile useful life would be required
to do so. Beginning in MY 2020 all vehicles would be required to be
certified to on the Tier 3 test fuel, regardless of the bin they are
certified to or the useful life they are required to meet.
    Manufacturers would also be required to comply with more stringent
PM standards on a percent phase-in schedule. Compliance with the PM
standards, which is consistent with the CARB LEV III program, would be
independent of the fleet average requirements described above. The PM
emission standards for FTP and SFTP described in Section IV.A.3 and 4
respectively would be implemented as a

percent phase-in requirement as described below under a basic phase-in
schedule or under an optional phase-in schedule.
    Vehicles certified to a Tier 3 bin, meeting the requirements of the
PM phase-in schedule, and complying with the other Tier 3 requirements
(i.e., 150,000 mile useful life (as applicable) and Tier 3
certification fuel, as applicable) would be considered ``Final Tier 3''
compliant vehicles. All other vehicles certified to Tier 3 bins but not
yet meeting the PM and other Tier 3 requirements would be considered
``Interim Tier 3'' compliant vehicles. At the completion of the percent
phase-in period for PM (2021 for the basic PM phase-in schedule and
2022 for the alternative PM phase-in schedule, as described below), 100
percent of vehicles would need to meet the all Tier 3 requirements and
would be considered ``Final Tier 3'' vehicles.
    For the PM requirements, each year manufacturers would be required
to meet either the basic PM percent phase-in or alternative PM phase-in
as described in the following subsections. The basic percent PM phase-
in schedule is composed of fixed yearly minimum phase-in percentages
that we expect that most manufacturers would meet to comply with the
Tier 3 requirements. The alternative PM phase-in schedule provides
additional flexibility for manufacturers with product offerings that
may not provide sufficient vehicle model granularity to allow for a
gradual transition into the Final Tier 3 requirements as described
below. In either case, Interim Tier 3 vehicles not yet meeting the Tier
3 PM standards must at a minimum meet the Tier 2 PM full useful life
FTP standard of 10 mg/mi and the SFTP weighted composite standard of 70
mg/mi.
i. Basic PM Percent Phase-In Schedule
    It is important to note that the percent phase-in of the new Tier 3
standards that we are proposing and the declining fleet average
standards to which a manufacturer's fleet is held are separate and
independent elements of the Tier 3 program. ``Phase-in'' in this
context means the fraction of a manufacturer's fleet that would be
required to meet the new Tier 3 PM standards in a given model year. We
expect manufacturer fleets to consist of a mix of vehicles certified to
Tier 2, LEV II, LEV III and Tier 3 standards throughout the percent
phase-in period.
    As discussed above, vehicles originally certified to Tier 2, LEV
II, and LEV III would be carried over into the Tier 3 program as
Interim Tier 3 vehicles. A vehicle would be considered a ``Final Tier 3
vehicle'' when it is certified to one of the Tier 3 bins; meets the
Tier 3 PM standards; certifies to the 150,000 useful life value (for
LDT2s, LDT3s, LDT4s, and MDPVs); and certifies on the new certification
test fuel. Table IV-11 below presents the proposed PM phase-in schedule
for Final Tier 3 vehicles.

                                               Table IV-11--PM Phase-In Schedule for Final Tier 3 Vehicles
--------------------------------------------------------------------------------------------------------------------------------------------------------
             Model year                              2017                      2018            2019            2020            2021       2022 and later
--------------------------------------------------------------------------------------------------------------------------------------------------------
Manufacturer's Fleet (%)............  20\a\.............................              20              40              70             100             100
                                                                         -------------------------------------------------------------------------------
Vehicle Types.......................  <= 6,000 lbs GVWR.................                     All vehicles <= 8,500 lbs GVWR and MDPVs
--------------------------------------------------------------------------------------------------------------------------------------------------------
\a\ In 2017 model year, a manufacturer may optionally include vehicles up to 8,500 lbs GVWR and/or MDPVs in its phase-in calculation.

ii. Optional PM Phase-In
    The proposed PM percent-of-sales phase-in schedule described above
would allow manufacturers with multiple vehicle models to plan the
phase-in of those models based on anticipated volumes of each vehicle
model. However, manufacturers certifying only a few vehicle models
might not benefit from this schedule. This is because, in order to
satisfy the phase-in schedule percentages, they might have to over-
comply with the required percentages earlier than would a manufacturer
with many vehicle models available for the phase-in.
    For instance, a manufacturer with only two models that each equally
accounted for 50 percent of their sales would be required to introduce
(at least) one of the models in MY 2017 meet the PM phase-in
requirement of 20 percent in the first year. Because it represented 50
percent of the manufacturer's sales, this model would then also meet
the requirements for MY 2018 (20 percent) and MY 2019 (40 percent). To
meet the MY 2020 requirement of 70 percent of sales, however, the
manufacturer would need to introduce the second Tier 3 vehicle that
year. Thus the manufacturer would have introduced 100 percent of its
Tier 3 models one year earlier than would have been required of a
manufacturer that was able to delay the final 30 percent of its fleet
until MY 2021 (by distributing its their models over the entire phase-
in period).
    To provide for more equal application of this benefit among all
manufacturers in the early years of the program, we are proposing an
optional ``indexed'' PM phase-in schedule that could be used by a
manufacturer to meet its PM percent phase-in requirements. A
manufacturer that exceeded the phase-in requirements in any given year
would be allowed to, in effect, offset some of the phase-in
requirements in a later model year. The optional phase-in schedule
would be acceptable if it passes a mathematical test. The mathematical
test is designed to provide manufacturers a benefit from certifying to
the standards at higher volumes than obligated to under the normal
phase-in schedule, while ensuring that significant numbers of vehicles
are meeting the new Tier 3 requirements during each year of the
optional phase-in schedule. In this approach, manufacturers would
weight the earlier years by multiplying their percent phase-in by the
number of years prior to MY 2022 (i.e., the second year of the 100
percent phase-in requirement).
    The proposed mathematical equation for applying the optional PM
phase-in is as follows:

(5 x APP2017) + (4 x APP2018) + (3 x APP2019) + (2 x APP2020) + (1 x
APP2021) >=540,

where APP is the anticipated phase-in percentage for the referenced
model year.
    The sum of the calculation would need to be greater than or equal
to 540, which is the result when the optional phase-in equation is
applied to the primary percent phase-in schedule (i.e., 5 x 20% + 4 x
20% + 3 x 40% + 2 x 70% + 1 x 100% = 540).
    Applying the proposed optional PM phase-in equation to the
hypothetical manufacturer in the example above, the manufacturer could
postpone its model introductions by one year each, to MY 2018 and MY
2021. Its calculation would be (5 x 0% + 4 x 50% + 3 x 50% + 2 x 50% +
1 x 100% = 550, and thus the phase-in would be acceptable.
    EPA requests comment on the proposed PM phase-in schedules.

h. In-Use Standards
i. NMOG+NOX
    The proposed Tier 3 emission standards would require a substantial
migration of emission control technology historically used only on a
small percent of the fleet and typically limited to smaller vehicles
and engines. While we believe that these technologies can generally be
used on any vehicle and are applicable to the entire fleet,
manufacturers have less experience with the in-use performance of these
technologies across the fleet. For example, technologies that
accelerate catalyst warm-up such as catalyst location close to the
engine exhaust ports and other advanced thermal management approaches
would be new to certain vehicle types, particularly larger vehicles
(i.e., LDT3/4s), which have historically not relied on these
technologies to meet emission standards.
    To help manufacturers address the lack of in-use experience and
associated challenges with the expanded introduction of these
technologies particularly in the larger vehicles, we are proposing
temporarily-relaxed in-use NMOG+NOX standards that would
apply to all vehicles certified to Bins 70 and cleaner as Interim or
Final Tier 3 vehicles. The in-use standards would apply during the
entire percent phase-in period (i.e., through MY 2021). The proposed
in-use standards would be 40 percent less stringent than the
certification standards, providing a significant but reasonable
temporary cushion for the uncertainties associated with new
technologies (or new applications of existing technologies) over the
life of the vehicle.
    The proposed in-use NMOG+NOX standards are shown in
Table IV-12.

 Table IV-12--Proposed FTP In-Use Standards for Light Duty Vehicles and
                                  MDPVs
                                 [mg/mi]
------------------------------------------------------------------------
                                                           NMOG+NOX (mg/
                           Bin                                  mi)
------------------------------------------------------------------------
Bin 160.................................................             160
Bin 125.................................................             125
Bin 70..................................................              98
Bin 50..................................................              70
Bin 30..................................................              42
Bin 20..................................................              28
------------------------------------------------------------------------

ii. PM
    As with the proposed NMOG+NOX standards, the
introduction of new emission control technologies or new applications
of existing technologies (e.g., GDI, turbocharging, downsized engines)
would create significant uncertainties for manufacturers about in-use
performance over the vehicle's useful life. We are proposing a
temporary in-use FTP standard for PM of 6 mg/mi for all light duty
vehicles and MDPVs certified to the Tier 3 full useful life 3 mg/mi
standard. Since the Tier 3 PM standard has a percent phase-in schedule
spread over several years, starting in 2017 with full phase-in
completed in 2022, we are proposing that the in-use standard apply to
all vehicles certified to the new PM standards during the entire
percent phase-in period (i.e., through MY 2021).
    We are also proposing temporarily-relaxed in-use US06 PM standards.
We propose in-use standards 5 mg/mi less stringent than the
certification standards, or 15 mg/mi for all light duty vehicles up to
and including 6,000 lbs GVWR and 25 mg/mi for all light duty vehicles
and light-duty trucks over 6,000 lbs GVWR and MDPVs. Consistent with
the FTP in-use standards, these in-use standards would apply to all
vehicles certified to the new PM standards during the entire percent
phase-in period (i.e., through MY 2021).
    EPA requests comment on the proposed in-use standards.
i. FFVs
    Because of the physical and chemical differences in how emissions
are generated and controlled between vehicles operating on gasoline and
ethanol, manufacturers of vehicles designed for high-percentage blends
of ethanol (usually called Flexible Fuel Vehicles, or FFVs) may face
unique compliance challenges under the proposed Tier 3 program.
Historically, under the Tier 2 program, FFVs have only been required to
meet all Tier 2 emission standards while operating on gasoline; when
operating on the alternative fuel (generally this means a blend that is
nominally 85 percent ethanol, or E85), they have only been required to
meet the FTP emission standards.
    However, E85 use may rise considerably in the future as ethanol use
increases in response to the Renewable Fuels Standards (RFS). Thus, it
is increasingly important that FFVs maintain their emission performance
when operating on E85 across different operating conditions.
    We believe that at standard test conditions, requiring
manufacturers to meet the Tier 3 standards on any blend of gasoline and
ethanol would not add technological feasibility concerns beyond
compliance on gasoline alone (or low-level blends like E10 or E15). We
are thus proposing that in addition to complying with the Tier 3
requirements when operating on gasoline, FFVs also comply with both the
FTP and the SFTP emission standards when operating on E85. This would
include the requirement to meet emission standards for both gasoline
and E85 for the FTP, highway test, and SFTP emission standards at
standard test temperatures (i.e., 68 [deg]F to 86 [deg]F). Since FFVs
can operate on any blend of gasoline and ethanol (up to a nominal 85
percent ethanol), the emission requirements apply to operation at all
levels of the alternative fuel that can be achieved with commercially
available fuels. However, for emission compliance demonstration
purposes, we will continue to test on gasoline and the highest
available level ethanol.
    EPA welcomes comment on this proposed approach to FFV compliance.
j. Credit for Direct Ozone Reduction (DOR) Technology
    Since the late 1990s, technologies have been commercialized with
which vehicles can remove ozone from the air that flows over the
vehicle's coolant radiator. In such direct ozone reduction (DOR)
technology, a catalytic coating on the radiator is designed to convert
ambient ozone into gaseous oxygen, addressing the air quality concerns
about ozone. Detailed technical analyses for the California LEV II and
the federal Tier 2 programs showed that when properly designed these
systems can remove sufficient ozone from the air to be equivalent to a
quantifiable reduction in tailpipe NMOG emissions. In the earlier
programs, both California and EPA provided methodologies through which
a manufacturer could demonstrate the capability and effectiveness of
the ozone-reducing technology and be granted an NMOG credit. A small
number of vehicle models with DOR applications received credit under
the LEV II program; no manufacturer formally applied for credits under
the federal Tier 2 program.
    Some manufacturers have expressed an interest in the continued
availability of a DOR credit as a part of their potential LEV III and
Tier 3 compliance strategies. EPA believes that when a DOR system is
shown to be effective in reducing ozone, a credit toward Tier 3
compliance is warranted. We propose that manufacturers following the
California methodology for demonstrating effectiveness and calculating
a appropriate credit for a DOR system be granted a specific credit
toward the NMOG portion of the

NMOG+NOX standard.\265\ As with the California program, such
a credit could not exceed 5 mg/mi NMOG. We invite comment on the
appropriateness of this proposed DOR credit approach, including the
application of the California methodology to the federal Tier 3
program.
---------------------------------------------------------------------------

    \265\ EPA is incorporating the CARB DOR methodology by
reference.
---------------------------------------------------------------------------

k. Credit for Adopting a 150,000-Mile Emissions Warranty
    Under the Tier 3 standards proposed above manufacturers would be
expected to design their emission control systems to continue to
operate effectively for a useful life of 150,000 miles (120,000 miles
for some smaller vehicles). However, as with the current Tier 2
program, manufacturers are only required to replace failed emission
control components or systems on customers' vehicles for a limited time
period, specified in the Clean Air Act (80,000 miles/8 years for key
emission control components). EPA believes that voluntary extension of
this warranty obligation by manufacturers would provide additional
emission reductions by helping ensure that controls continue to operate
effectively in actual operation through the full life of the vehicle.
    We propose that a manufacturer providing its customers with a
robust emission control system warranty of 15 years or 150,000 miles be
eligible for a modest credit of 5 mg/mi NMOG+NOX.\266\
Because of the significant liability that manufacturers would be
accepting, we do not expect that the use of this credit opportunity
would be widespread. However, based on our modeling of the expected
deterioration of the emissions of future Tier 3 vehicles absent repair/
replacement of failed emission controls, we anticipate that the value
to the environment of long emissions warranties in terms of reduced
real-world emissions would significantly exceed the 5 mg/mi
NMOG+NOX credit.\267\
---------------------------------------------------------------------------

    \266\ Manufacturers choosing to comply with the standards for a
120,000 mile useful life for their LDVs and LDT1s would not be
eligible for this extended warranty credit for those vehicles.
    \267\ Beardsley, M, et al. (2013, February). Updates to MOVES
for the Tier 3 NPRM. Memorandum to the docket.
---------------------------------------------------------------------------

    We propose to use the same criteria for approving such a credit as
does the parallel California program.\268\ Thus, in addition to
committing to customers that failing emission controls would be
repaired or replaced for 15 years/150,000 miles, manufacturers would
also need to accept the liability that in the event that a specific
emissions control device failed on greater than 4 percent of a vehicle
model's production, they would recall the entire production of that
model for repair. EPA requests comment on this optional credit
opportunity.
---------------------------------------------------------------------------

    \268\ EPA is incorporating the CARB extended emission warranty
provisions by reference.
---------------------------------------------------------------------------

l. Averaging, Banking, and Trading of Credits
    An averaging, banking, and trading (ABT) program was established in
the Tier 2 program to provide for credits to be generated by certifying
vehicles that perform better than the standards, for those credits to
be used to offset vehicles that perform worse than the standards, and
for credits to be banked for later use or traded to other
manufacturers. The ABT program is largely unchanged by this Tier 3
proposal. In some cases, especially during the transitional years,
there would be specific restrictions on the generation of credits, as
described above. Also, we are proposing that Tier 3 credits expire
after 5 years, consistent with the LEV II and LEV III programs and
similar to the basic credit carry-forward provisions in the recent
light-duty and heavy-duty greenhouse gas rules. We invite comment on
the ABT program in general, and specific comment on a longer Tier 3
credit life, including any flexibilities that this may provide and any
implications for record retention requirements by manufacturers.
m. Tier 3 Transitional Emissions Bins
    In discussions with manufacturers, EPA has become aware that some
vehicles may continue to be produced as late as MY 2019 that could be
certified to Tier 2 Bin 3 or Bin 4 standards. In order to provide
manufacturers flexibility in meeting the fleet average standards and
thus to further facilitate the transition from Tier 2 to Tier 3, we
will allow manufacturers to certify to the combined NMOG+NOX
levels of these bins through MY 2019. Two proposed transitional Tier 3
bins, Bin 110 and Bin 85, would have NMOG+NOX standards on
the FTP of 110 mg/mi and 85 mg/mi, respectively (i.e., the sum of the
NMOG and NOX values from the Tier 2 bins); the associated
FTP standards for CO, PM, and HCHO corresponding to these bins would be
identical to those for vehicles certified to the proposed Tier 3 Bin
125. Tier 3 SFTP standards would apply to these vehicles, and these
vehicles would be included in the Tier 3 p.m. percent phase-in
calculations.
n. Compliance Demonstration
    In general, we are proposing that manufacturers demonstrate
compliance with the proposed Tier 3 light-duty vehicle emission
standards in a very similar manner to current Tier 2 vehicle compliance
(see Sec.  86.1860 of the proposed regulatory language). However, we
propose for Tier 3 that manufacturers calculate their compliance with
the fleet average standards and percent phase-in standards based on
annual nationwide sales, including sales in California and Clean Air
Act Section 177 states. We believe that this approach represents
another step toward achieving the goal of an effectively nationwide
program as early as possible, which has been a basic principle in EPA's
development of this proposed program and broadly supported by vehicle
manufacturers. We also believe that basing compliance on nationwide
sales may reduce the need for manufacturers to project future sales and
track past years' sales in a disaggregated way. Because the proposed
Tier 3 provisions will become increasingly consistent with LEV III
provisions as the Tier 3 program phases in, we believe that any
disproportionate impacts of different mixes of vehicles in different
states are unlikely to occur. We seek comment on this approach to
compliance demonstration.
    This proposed nationwide compliance calculation approach would
apply to vehicles as they become subject to the Tier 3 provisions,
either the declining fleet-average NMOG+NOX curves or the
percent phase-in PM standards. Were any manufacturer to choose to use
the alternative FTP and SFTP phase-ins, which are not a part of the LEV
III program, the manufacturer would not include sales in California or
in the Section 177 states in its compliance calculations.\269\

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

    \269\ If EPA ultimately decided to continue the disaggregated
approach to fleet compliance calculations, we could potentially base
compliance with the proposed Tier 3 emission requirements on U.S.
sales (i.e., sales in non-California and non-Section 177 states).
---------------------------------------------------------------------------

B. Tailpipe Emissions Standards for Heavy-Duty Vehicles

1. Overview
    We are proposing Tier 3 exhaust emissions standards for heavy-duty
vehicles (HDVs) between 8,501 and 14,000 lbs GVWR that are certified to
gram per mile standards on a chassis dynamometer. Vehicles in this GVWR
range are often referred to as Class 2b (8,501-10,000 lbs) and Class 3
(10,001-14,000 lbs) vehicles, and are typically

full-size pickup trucks and work vans certified as complete
vehicles.\270\ Most are built by companies with even larger light-duty
truck markets, and as such they frequently share major design
characteristics and potential emissions control technologies with their
LDT counterparts. However, in contrast to the largely gasoline-fueled
LDT fleet, roughly half of the HD pickup and van fleet in the U.S. is
diesel-fueled, which is a consideration in setting emissions standards,
as diesel engine emissions and control strategies differ from those of
gasoline engines.
---------------------------------------------------------------------------

    \270\ 40 CFR 86.1803-01 defines HDVs to also include motor
vehicles at or below 8,500 lbs GVWR that have a vehicle curb weight
of more than 6,000 lbs or a basic vehicle frontal area in excess of
45 square feet, and we are proposing that these vehicles also would
be subject to the standards and other provisions applicable to Class
2b vehicles discussed in this section.
---------------------------------------------------------------------------

    Manufacturers of diesel-fueled complete HDVs have the option under
existing EPA regulations to satisfy EPA criteria emissions requirements
for these vehicles by using engines certified through engine
dynamometer testing, but for the most part have chosen to certify whole
vehicles on the chassis test. We are proposing to codify this common
practice and require that diesel-fueled Class 2b and 3 complete Tier 3
vehicles, like their gasoline-fueled counterparts, be certified to the
Tier 3 standards on the chassis test. The current prohibition in 40 CFR
86.1863-07(d) on averaging, banking, and trading (ABT) credit
generation and use by chassis-certified diesel HDVs would be replaced
by the proposed fleetwide averaging program. We are not proposing
changes to the heavy-duty engine certification requirements at this
time.
    Manufacturers of incomplete HDVs that are sold to secondary
manufacturers for subsequent completion (less than 10 percent of the
Class 2b and 3 U.S. market) are also allowed under existing EPA
regulations to certify via either the chassis or engine test, and those
who choose to chassis-certify in the future would be subject to Tier 3
requirements. We are not proposing to mandate chassis certification of
incomplete Class 2b and 3 vehicles, but we note that California's LEV
III program does include such a requirement for Class 2b and we request
comment on doing the same in the federal program. We further note that
MDPVs are classified as HDVs under the Clean Air Act but, as in our
current Tier 2 program, would be covered as part of our Tier 3 light-
duty program discussed in Section IV.A, and not in the proposed program
described here.
    The key elements of the proposed Tier 3 program for HDVs parallel
those proposed for passenger cars and LDTs, with adjustments in
standards levels, emissions test requirements, and implementation
schedules, appropriate to this sector. These key elements include a
combined NMOG+NOX declining fleet average standard beginning
in 2018 and reaching the final, fully phased-in level in 2022, creation
of a bin structure for standards, new stringent PM standards phasing in
on a separate schedule, changes to the test fuel for gasoline- and
ethanol-fueled vehicles, extension of the regulatory useful life to
150,000 miles, and a new requirement to meet standards over the SFTP
that would address real-world driving modes not well-represented by the
FTP cycle alone. We believe that other requirements already in place
for HDV testing and compliance remain appropriate. In particular, we
believe the current HDV certification requirement to test at the
adjusted loaded vehicle weight (ALVW), equal to vehicle curb weight
plus one-half the payload weight, is more appropriate for these heavy-
duty work trucks and vans than the LDT requirement to test at curb
weight plus 300 lbs. These differences from light-duty requirements
also factor into the evaluation of potential control technologies and
subsequent choice of standards levels, as discussed below.
    As with the proposed light-duty Tier 3 program, we are putting
strong emphasis on coordinating this HDV Tier 3 proposal with
California's LEV III program for Class 2b and 3 vehicles, referred to
in LEV III as medium-duty vehicles (MDVs). The goal is to create a
coordinated ``national program'' in which California would accept
compliance with Tier 3 standards as sufficient to also satisfy LEV III
requirements, thus allowing manufacturers to comply nationwide by
marketing a single vehicle fleet. With this goal in mind, we discuss
the relationship of the proposed HDV Tier 3 program provisions to LEV
III throughout this section. As part of this effort, we are proposing
that manufacturers of Tier 3 HDVs calculate compliance with the fleet
average standards and percent phase-in standards discussed in this
section based on annual nationwide sales, including sales in California
and Clean Air Act Section 177 states. This would help to create an
effectively nationwide program, which has been a basic principle in
EPA's development of this proposed program and broadly supported by
vehicle manufacturers. If this proposed approach to HDV fleet
compliance calculations is not adopted, EPA could base compliance with
the proposed Tier 3 requirements on U.S. sales outside of California
and the Section 177 states.
    Furthermore, in 2011 EPA and NHTSA set first-ever standards for
GHGs and fuel consumption from HD pickups and vans (as well as other
heavy-duty vehicles and engines). These standards phase in over 2014-
2018, so in developing the Tier 3 HDV proposal we have carefully taken
this new program into account to maximize the coordination between the
two complementary heavy-duty regulatory programs and avoid
inconsistencies.
2. HDV Exhaust Emissions Standards
a. Bin Standards
    We are proposing that manufacturers certify HDVs to Tier 3
requirements by having them meet the standards for one of the bins
listed in Table IV-13. Manufacturers would choose bins for their
vehicles based on their product plans and corporate strategy for
compliance with the fleet average standards discussed in Section
IV.A.2.b, and once a vehicle's bin is designated, those bin standards
apply throughout its useful life. Because the fleet average standards
become more stringent over time, the bin mix would gradually shift from
higher to lower bins. As in the past, we are proposing numerically
higher standards levels for Class 3 vehicles than for Class 2b
vehicles, reflective of the added challenge in reducing per-mile
emissions from large work trucks designed to carry and tow heavier
loads. Also, the proposed standards levels for both Class 2b and Class
3 HDVs are significantly higher than those being proposed for light-
duty trucks due to marked differences in vehicle size and capability,
and to our requirement to test HDVs in a loaded condition (at ALVW). By
conducting emissions testing with loaded vehicles, the heavy-duty
program ensures that emissions controls are effective when these
vehicles are performing their core function: hauling heavy loads. This
is a key difference between the heavy-duty and light-duty truck
programs. The proposed bin structure and standards levels are
consistent with those in the LEV III program. We request comment on the
usefulness of creating additional bins between Bin 0 and the next
lowest bin in each vehicle class, as a means of encouraging clean
technologies and adding flexibility.

                                                      Table IV-13--Proposed FTP Standards for HDVs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         NMOG+NOX  (mg/                                                                    Formaldehyde
                                                               mi)        NMOG  (mg/mi)   NOX  (mg/mi)     PM  (mg/mi)      CO  (g/mi)        (mg/mi)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Class 2b (8,501-10,000 lbs GVWR)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin 395 (interim)......................................  ..............             195             200               8              6.4               6
Bin 340 (interim)......................................  ..............             140             200               8              6.4               6
Bin 250................................................             250  ..............  ..............               8              6.4               6
Bin 200................................................             200  ..............  ..............               8              4.2               6
Bin 170................................................             170  ..............  ..............               8              4.2               6
Bin 150................................................             150  ..............  ..............               8              3.2               6
Bin 0..................................................               0  ..............  ..............               0              0                 0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Class 3 (10,001-14,000 lbs GVWR)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Bin 630 (interim)......................................  ..............             230             400              10              7.3               6
Bin 570 (interim)......................................  ..............             170             400              10              7.3               6
Bin 400................................................             400  ..............  ..............              10              7.3               6
Bin 270................................................             270  ..............  ..............              10              4.2               6
Bin 230................................................             230  ..............  ..............              10              4.2               6
Bin 200................................................             200  ..............  ..............              10              3.7               6
Bin 0..................................................               0  ..............  ..............               0              0                 0
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The proposed NMOG and NOX standards for the highest bins
in each class (Class 2b Bin 395 and Class 3 Bin 630) are equal to the
current non-methane hydrocarbon (NMHC) and NOX standards
that took full effect in 2009, as well as to equivalent LEV standards
in California's LEV II program. These bins are intended as carryover
bins. That is, we would expect them to be populated with vehicles that
are designed to meet the current standards, and that are being phased
out as new lower-emitting vehicle designs phase in to satisfy the
proposed Tier 3 fleet average NMOG+NOX standard. We also
consider the next highest bins (Class 2b Bin 340 and Class 3 Bin 570)
to be carryover bins, because they likewise can be readily achieved by
vehicles designed for today's EPA and California LEV II emissions
programs. As the 2018-2022 phase-in progresses, it would become
increasingly difficult to produce vehicles in these bins and still meet
the fleet average standard. Therefore vehicles in these bins (as well
as some others not yet designed to meet Tier 3 PM standards described
in Section IV.B.2.d) would be considered ``interim Tier 3'' vehicles,
and the bins themselves would be considered ``interim bins.''
    To facilitate their use in this carryover function, we are
proposing that the interim bins not include SFTP requirements, longer
useful life requirements, or requirements to conduct exhaust emissions
testing with the proposed new gasoline test fuel discussed in Section
IV.D, although testing on this fuel would be allowed. For gasoline-
fueled HDVs in all other bins, we are proposing that exhaust emissions
testing be conducted with the new test fuel. (See Section IV.D.5 for
discussion of our request for comment on extending this requirement to
testing of gasoline-fueled heavy-duty engines as well.) In the context
of these proposed accommodations for the interim bins, we propose two
additional measures to help ensure these bins are focused on their
function of helping manufacturers transition to Final Tier 3 vehicles.
First, we propose that the interim bins be available only in the phase-
in years of the program, that is, through MY 2021, as is appropriate to
their interim status.
    Second, we are proposing that vehicles in the interim bins meet
separate NMOG and NOX standards, as indicated in Table IV-
13, rather than combined NMOG+NOX standards. This proposed
provision is intended to keep a manufacturer from redesigning or
recalibrating a vehicle design under combined NMOG+NOX Tier
3 standards for such purposes as reducing fuel consumption, through
means that result in higher NOX or NMOG emissions than
exhibited by today's vehicles, contrary to the intended carryover
function of the interim bins. We note that other, more stringent,
proposed bins also carry this potential but to a lesser degree, and we
feel their relatively low NMOG+NOX standards levels
sufficiently mitigate this concern, whereas the interim bins have the
potential to allow a doubling of emissions or more. We request comment
on this issue and the proposed approach to addressing it.
b. Fleet Average NMOG+NOX Standards
    As in the light-duty program, a key element of the Tier 3 program
is a fleet average NMOG+NOX standard that becomes more
stringent in successive model years: In the case of HDVs, from 2018 to
2022. Each HDV sold by a manufacturer in each model year contributes to
this fleet average based on the mg/mi NMOG+NOX level of the
bin declared for it by the manufacturer. For the interim bins, with
separate NMOG and NOX standards, the NMOG+NOX
level is the simple sum of the NMOG and NOX standards.
Manufacturers may also earn or use credits for fleet average
NMOG+NOX levels below or above the standard in any model
year, as described in Section IV.B.4. We are proposing the separate
Class 2b and Class 3 fleet average standards shown in Table IV-14,
though a manufacturer could effectively average the two fleet classes
using credits (see Section IV.B.4). We believe this split-curve
approach is superior to a single HDV phase-in because it recognizes the
different Class 2b/Class 3 fleet mixes among manufacturers and the
different challenges in meeting mg/mi standards between Class 2b and
Class 3 vehicles, while still allowing for a corporate compliance
strategy based on a combined HDV fleet through the use of credits.
    The proposed fleet average standards are consistent with those set
for the MDV LEV III program in model years 2018 and later. Note that
the LEV III program also sets standards for model years before 2018,
something EPA is not requiring due to lead time considerations.
However, we are proposing that manufacturers may voluntarily meet bin
and fleet average standards in model years 2016 and 2017 that are
consistent with the MDV LEV III standards, for the purpose of
generating credits that can be used later

or traded to others. These proposed voluntary standards are shown in
Table IV-14. This proposed voluntary opt-in program serves the
important purpose of furthering consistency between the federal and
California programs, such that manufacturers who wish to can produce a
single vehicle fleet for sale nationwide, with the opportunity for
reciprocal certification in affected model years. It further
incentivizes pulling ahead of Tier 3 technologies, with resulting
environmental benefits, by providing for early compliance credits in
this nationwide fleet.
    Manufacturers choosing to opt into this early compliance program
could start in either model year 2016 or 2017. They would have to meet
the full complement of applicable bin standards and requirements,
including SFTP standards, but not the Tier 3 PM FTP and SFTP standards
discussed in Sections IV.B.2.d and IV.B.3.a, or the evaporative
emissions standards discussed in Section IV.C, because these
requirements phase in on a later schedule. We are also requesting
comment on extending the voluntary compliance opportunity to the 2015
model year.

                                               Table IV-14--Proposed HDV Fleet Average NMOG+NOX Standards
                                                                         [mg/mi]
--------------------------------------------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                            Voluntary
                                                                Required program
--------------------------------------------------------------------------------------------------------------------------------------------------------
Model Year.....................            2016            2017            2018            2019            2020            2021  2022 and later.
Class 2b.......................             333             310             278             253             228             203  178.
Class 3........................             548             508             451             400             349             298  247.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    We believe that offering this voluntary opt-in would benefit the
environment, the regulated industry, and vehicle purchasers, because it
has potential to accomplish early emissions reductions while
maintaining the goal of a cost-effective, nationwide vehicle program in
every model year going forward. We request comment on all facets of
this proposed approach.
    Although manufacturers would be allowed to meet the fleet average
NMOG+NOX standard through whatever combination of bin-
specific vehicles they choose, it is instructive to note that the fully
phased in fleet average standard for model years 2022 and later would
be the equivalent of a Class 2b fleet mix of 90 percent Bin 170 and 10
percent Bin 250 vehicles, and a Class 3 fleet mix of 90 percent Bin 230
and 10 percent Bin 400 vehicles. Therefore, it is appropriate to
consider Bin 170 Class 2b vehicles and Bin 230 Class 3 vehicles to be
representative of Tier 3-compliant HDVs in the long term.
    The Tier 3 program we are proposing for HDVs would result in
substantial reductions in harmful emissions from this large fleet of
work trucks and vans, vehicles that are typically driven over high
annual miles on every part of the nation's highway and urban roadway
system. The Final Tier 3 standards levels for NMOG+NOX and
PM are on the order of 60 percent lower than the current stringent
standards that took full effect three years ago.
c. Alternative NMOG+NOX Phase-In
    We believe that the program described in Sections IV.B.2.a and b
above would provide manufacturers with a flexible and effective
compliance path. However, as in the case of the light-duty standards
discussed above, we are proposing to provide an alternative compliance
path that would be available to any manufacturer who prefers a stable
standard and four full years of lead time, as specified in the Clean
Air Act.\271\ This alternative approach would be equivalent to the
primary approach that is based on NMOG+NOX declining fleet
average standards and would apply during the program phase-in over the
2016-2022 model years, with the first three of those model year
standards made voluntary and set at levels to align with the California
LEVIII program. We are proposing an alternative phase-in structured to
require an annually increasing percent-of-sales of HDVs certified to
the fully phased in 178 mg/mi (Class 2b) and 247 mg/mi (Class 3)
standards, as shown in Table IV-15.
---------------------------------------------------------------------------

    \271\ For vehicles above 6,000 lbs GVWR, CAA section
202(a)(3)(C) requires EPA to provide manufacturers with a minimum of
4 years of lead time before mandatory changes to any standard
applicable to HC, NOX, CO or PM can be implemented, and 3
years of stability between changes to any such standard.

                                          Table IV-15--Proposed Percent-of-Sales Alternative NMOG+NOX Phase-in
--------------------------------------------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Voluntary
                                                        Required program
--------------------------------------------------------------------------------------------------------------------------------------------------------
Model Year.....................            2016            2017            2018            2019            2020            2021  2022 and later.
Class 2b.......................             29%             39%             54%             65%             77%             88%  100%.
Class 3........................             21%             32%             47%             60%             73%             87%  100%.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Under our alternative phase-in proposal, the availability of
emissions averaging makes the two alternatives functionally equivalent,
not just in the annual emissions reductions they achieve, but also in
how manufacturers may design their mix of products to meet the phase-in
standards. Although we are proposing to make the alternative approach
available, we believe that the primary approach--the declining fleet
average standard discussed above--is more consistent with the approach
taken in California's LEV III program and in recent GHG reduction
rules.
    To help ensure that the percent-of-sales alternative is fully
equivalent to the primary program in terms of fleet-wide emissions
control and technology mix choices, we are proposing that it include
some additional provisions. First, we are proposing that the Tier 3
vehicles being phased in under the percent-of-sales alternative, in
addition to meeting the fully phased-in NMOG+NOX FTP
standards, must also meet all other FTP and (as described below) SFTP
standards required by the primary compliance program. These include the
CO and formaldehyde FTP standards in Table IV-13, the 150,000 mile (15
year) useful life requirement, exhaust emissions testing with the new

test fuel for gasoline- and ethanol-fueled vehicles discussed in
Section IV.D, and the NMOG+NOX and CO SFTP standards in
Table IV-16. The specific proposed standards are those for the bins in
these tables closest to the fully phased-in NMOG+NOX
standards: Bin 170 for Class 2b and Bin 230 for Class 3. (The PM and
evaporative emissions standards phase in on separate schedules under
both alternatives, as discussed in Sections IV.B.2.d and IV.C.)
    Second, we are proposing to make an ABT program available for the
percent-of-sales alternative, structured like the one proposed for the
primary option. This would involve certifying the vehicles in a
manufacturer's HDV fleet to the bin standards in Table IV-13, and
demonstrating compliance with the fleet average standards for the
primary program in each model year, including through the use of ABT
credits as in the primary program. We are proposing to use the fleet
average calculation method for purposes of ABT because, as explained
above, we have determined that making this demonstration is equivalent
to demonstrating compliance with the percent-of-sales requirement, and
we see no value in complicating the program with another set of
calculations.
    However, we are proposing one difference between the primary and
alternative options with respect to ABT provisions. Unlike in the
primary option, manufacturers would not have to certify all vehicles
into bins in order to take advantage of the ABT provisions under the
percent-of-sales alternative. Rather they could choose to certify any
``phase-out'' vehicles (that is, those not counting toward the percent-
of-sales phase-in) to the pre-Tier 3 NMHC and NOX standards,
provided these vehicles do not have family emission limits (FELs) above
those standards. These non-Tier 3 vehicles would not be subject to the
Tier 3 standards or other vehicle-specific elements of the Tier 3
compliance program. For the purposes of the fleet average ABT
calculation, the NMOG+NOX levels for these non-Tier 3
vehicles would be set equal to the sum of the NMOG and NOX
standards for the highest bins: 395 mg/mi for Class 2b and 630 mg/mi
for Class 3, because these standards are numerically equal to the pre-
Tier 3 NMHC and NOX standards.
d. Phase-In of PM Standards
    Consistent with the light-duty Tier 3 proposal discussed in Section
IV.A, we are proposing to phase in the PM standards for HDVs as an
increasing percentage of a manufacturer's production of chassis-
certified HDVs (combined Class 2b and 3) per year. The reasons
discussed in Section IV.A for this phase-in schedule in the light-duty
sector also apply to the heavy-duty sector. In addition to concerns
regarding the availability and required upgrades of test facilities
used for both light-duty and heavy-duty vehicle testing, manufacturers
have expressed uncertainty about PM emissions with new engine and
emissions control technologies entering the market as a result of new
GHG standards. Therefore we are proposing the same phase-in schedule as
proposed for the light-duty sector in model years 2018-2019-2020-2021:
20-40-70-100 percent, respectively. This would apply to HDVs certified
under either NMOG+NOX phase-in alternative. The California
Air Resources Board is phasing in the LEV III PM standards for HDVs on
the same schedule, except that LEVIII would also involve a 10 percent
PM phase-in in the 2017 model year, and we ask for comment on our doing
so as well, in the context of the voluntary opt-in discussed in Section
IV.B.2.b. The voluntary NMOG+ NOX and PM standards may be
pursued separately, with no requirement that they be met on the same
vehicles.
    For manufacturers choosing the declining fleet average
NMOG+NOX compliance path, the PM phase-in requirement for
HDVs would be completely independent of the NMOG+NOX phase-
in. As a result, vehicles certified to any of the bin standards for
NMOG and NOX need not necessarily meet Tier 3 PM standards
before the 2021 model year. Instead, the current 0.02 g/mi PM standard
would apply for those vehicles not yet phased into the Tier 3 PM
standards. We are proposing that manufacturers choosing the percent-of-
sales phase-in alternative for NMOG+NOX would be required to
meet the PM phase-in requirements with only those vehicles certified to
the Tier 3 NMOG+NOX standard, except in the 2018 and earlier
model years when the standards, including the PM standards, would be
voluntary, and in the 2021 model year when the 100 percent PM phase-in
requirement exceeds the 87-88 percent NMOG+NOX phase-in
requirement.
    Consistent with the approach we are proposing for the light-duty
sector, we would consider any vehicle under either compliance path that
is not certified to Tier 3 standards for PM, NMOG, and NOX
(as well as the other, concomitant Tier 3 standards and requirements
such as extended useful life), an ``Interim Tier 3'' vehicle, a term
that also applies to vehicles certified in one of the interim bins, as
discussed above.
    Note that compliance with Tier 3 evaporative emissions requirements
would follow a separate phase-in schedule as described in Section IV.C,
such that a vehicle in an exhaust emissions family that the
manufacturer has phased into the new useful life and test fuel
requirements, may be in an evaporative emissions family that has not
yet phased these in for evaporative emissions testing.
i. Optional PM Phase-In
    The proposed percent-of-sales phase-in schedule for the PM
standard, described above, would allow manufacturers with multiple
vehicle models to determine and plan the phase-in of those models based
on anticipated volumes of each vehicle model. However, manufacturers
certifying only a few vehicle models may not be able to take advantage
of this schedule. This is because, in order to satisfy the phase-in
schedule percentages, they may have to over-comply with the required
percentages earlier than would a manufacturer with many vehicle models
available for the phase-in.
    For instance, a manufacturer with only two models that each equally
accounted for 50 percent of its sales would be required to introduce
(at least) one of the models in MY 2018 to meet the phase-in
requirement of 20 percent in the first year. At the 50 percent level,
this model would then also meet the requirements for MY 2019 (40
percent). To meet the MY 2020 requirement of 70 percent of sales,
however, the manufacturer would need to introduce the second Tier 3
vehicle that year. Thus the manufacturer would have introduced 100
percent of its Tier 3 models one year earlier compared to a
manufacturer that was able to delay the final 30 percent of its fleet
until MY 2021 by distributing its redesigned models over the entire
phase-in period.
    To provide for more equal application of this benefit among all
manufacturers in the early years of the program, we are proposing an
optional ``indexed'' phase-in schedule that could be used by a
manufacturer to meet its phase-in requirements. A manufacturer that
exceeded the phase-in requirements in any given year would be allowed
to, in effect, offset some of the phase-in requirements in a later
model year. The optional phase-in schedule would be acceptable if it
passes a mathematical test. The mathematical test is designed to
provide manufacturers a benefit from certifying to the standards at
higher volumes than obligated to under the normal phase-in schedule,
while ensuring that significant numbers of

vehicles are meeting the new Tier 3 requirements during each year of
the optional phase-in schedule. In this approach, manufacturers would
weight the earlier years by multiplying their percent phase-in by the
number of years prior to MY 2022 (i.e., the second year of the 100
percent phase-in requirement).
    The proposed mathematical equation for applying an optional phase-
in is as follows:

(4 x APP2018) + (3 x APP2019) + (2 x APP2020) + (1 x APP2021) >= 440,

where APP is the anticipated phase-in percentage for the referenced
model year. The sum of the calculation would need to be greater than or
equal to 440, which is the result when the optional phase-in equation
is applied to the primary percent phase-in schedule (4 x 20% + 3 x 40%
+ 2 x 70% + 1 x 100% = 440). EPA requests comment on this proposed
optional phase-in mechanism.
e. NMOG+NOX and NMOG vs. NMHC
    The reasons for setting combined NMOG+NOX standards
outlined in Section IV.A.1.a for the light-duty sector apply to HDVs
certified in the non-interim Tier 3 bins as well. In fact, the combined
standard is especially appropriate in the heavy-duty sector with
comparable sales of diesel and gasoline-fueled vehicles, because it
avoids the need to set ``lowest common denominator'' standards for NMOG
(likely based on feasible gasoline vehicle technologies) and
NOX (likely based on feasible diesel vehicle technologies).
These considerations also apply to the form of the SFTP standards,
discussed below.
    The current HDV standards that control emissions of volatile
organic compounds (VOCs), adopted in a 2001 final rule,\272\ are in the
form of NMHC. This is consistent with HD engine standards adopted in
the same final rule, but contrasts with Tier 2 LDV/LDT standards to
control VOCs that are in the form of NMOG. We believe it is appropriate
to transition HDVs to NMOG-based standards, and further to combined
NMOG+NOX standards, consistent with the light-duty Tier 3
proposal and light- and medium-duty LEV III program. Further, the
introduction of oxygenated test fuels requires an NMOG calculation to
properly control VOC emissions not properly accounted for in an NMHC
calculation. This would improve consistency with the LEV III program
and help to facilitate a single nationwide vehicle fleet. We do not
believe that this change would add significant cost to the program as
manufacturers are already capable of and experienced in making NMOG
determinations at their test facilities.

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

    \272\ 66 FR 5002 (January 18, 2001).
---------------------------------------------------------------------------

3. Supplemental FTP Standards for HDVs
    Unlike passenger cars and light trucks, HDVs are not currently
subject to SFTP standards. SFTP standards are intended to ensure
vehicles have robust emissions control over a wide range of real-world
driving patterns not well-covered by the FTP drive cycle. Even though
HDVs are not typically driven in the same way as passenger cars and
LDTs, especially as they frequently carry or tow heavy loads, we
believe some substantial portion of real world heavy-duty pickup and
van driving is not well-represented on the FTP cycle.
    The goal in setting the SFTP standards levels is not to force
manufacturers to add expensive new control hardware for off-FTP cycle
conditions, but rather to ensure a robust overall control program that
precludes high off-FTP cycle emissions by having vehicle designers
consider them in their choice of compliance strategies. High off-FTP
cycle emissions, even if encountered relatively infrequently in real-
world driving, could create a substantial inadequacy in the Tier 3
program, which aims to achieve very low overall emissions in use. The
SFTP provisions would also help make the HDV program more consistent
with the HD engine program, which for several years has included ``not-
to-exceed'' provisions to control off-cycle emissions. Therefore, in
addition to the SFTP provisions, we are further limiting enrichment on
spark ignition engines in all areas of operation unless absolutely
necessary.
a. SFTP NMOG+NOX, PM and CO Standards
    The proposed SFTP standards levels are provided in Table IV-16.
These are consistent with those in the LEV III program.

                                  Table IV-16--Proposed SFTP Standards for HDVs
----------------------------------------------------------------------------------------------------------------
                   Vehicles in FTP bins                     NMOG+NOX (mg/mi)     PM (mg/mi)         CO (g/mi)
----------------------------------------------------------------------------------------------------------------
                              Class 2b with horsepower (hp)/GVWR <= 0.024 hp/lb \a\
----------------------------------------------------------------------------------------------------------------
FTP Bins 200, 250, 340....................................               550                 7              22.0
FTP Bins 150, 170.........................................               350                 7              12.0
----------------------------------------------------------------------------------------------------------------
                                                    Class 2b
----------------------------------------------------------------------------------------------------------------
FTP Bins 200, 250, 340....................................               800                10              22.0
FTP Bins 150, 170.........................................               450                10              12.0
----------------------------------------------------------------------------------------------------------------
                                                     Class 3
----------------------------------------------------------------------------------------------------------------
FTP Bins 270, 400, 570....................................               550                 7               6.0
FTP Bins 200, 230.........................................               350                 7               4.0
----------------------------------------------------------------------------------------------------------------
\a\ These standards apply for vehicles optionally tested using emissions from only the highway portion of the
  US06 cycle.

    We are proposing that Tier 3 SFTP implementation for HDVs be linked
directly to the Tier 3 FTP phase-in and bins for these vehicles. That
is, an HDV certified to any of the Tier 3 FTP bin standards must meet
the SFTP standards for that bin as well. However, because the FTP PM
standard would phase in on a separate schedule, we propose to require
that SFTP PM compliance be linked to the same schedule. That is, an HDV
certified to

the Tier 3 FTP PM standard must meet the applicable SFTP PM standard as
well. This approach recognizes the complementary nature of FTP and SFTP
provisions and helps to ensure that Tier 3 emissions controls are
robust in real world driving. There are no proposed SFTP requirements
for the interim Tier 3 bins in each class (Class 2b Bins 340 and 395
and Class 3 Bins 570 and 630), because these are essentially carry-over
bins from the previous standards to aid the transition to Tier 3, and
therefore are not intended to prompt vehicle redesigns to new
standards. These implementation provisions are consistent with the
approach taken in the LEV III program, except that California would
allow FTP and SFTP phase-in requirements to be met on different
vehicles, and would apply more of the Tier 3 requirements for SFTP and
extended useful life to vehicles in the interim bins. We request
comment on the proposed standards, and on whether or not EPA should
adopt any LEV III provisions that differ from what we are proposing,
such as the application of PM SFTP standards to vehicles that are in
the interim bins and that also are certified to the Tier 3 p.m. FTP
standards.
    To help ensure a robust SFTP program that achieves good control
over a wide range of real world conditions, the current Tier 2 light-
duty program adopted a weighted-composite cycle, and we are proposing
to retain this approach for light-duty Tier 3 testing, as discussed in
Section IV.A.1.c. Under this composite cycle, NMOG+NOX
emissions are calculated from results of testing over three cycles: the
US06, the FTP, and the SC03, weighting these results by 0.28, 0.35, and
0.37, respectively. We considered applying the same composite cycle for
all HDV SFTP testing. However, based on data provided by industry
stakeholders, we decided that the full US06 cycle, combined with the
ALVW loaded test condition, would not be sufficiently representative of
real-world driving for two groups of HDVs: those with low power-to-
weight ratios and Class 3 vehicles.
    As part of their investigation of potential LEV III SFTP standards
for MDVs, California Air Resources Board staff determined that it is
not uncommon for vehicles above 8,500 lbs GVWR with low power-to-weight
ratio, which are largely in Class 2b, to have to work extremely hard to
keep up with the accelerations required in the initial and final
portions of the full US06 cycle, even proving physically unable to do
so in some cases, and raising the concern that these vehicles would not
be able to run a valid emissions test.\273\ Although our SFTP
provisions allow a test to continue when a vehicle is incapable of
attaining the vehicle speed demanded by the drive trace, we believe
routine occurrence of such an event for a group of vehicles would not
be consistent with a well-designed test regime. We would expect results
from such tests to exhibit significant test-to-test variability, making
it difficult to draw reliable conclusions from them. Furthermore, in
real-world driving, we would expect that most drivers who regularly
demand and do not receive adequate response would modify either their
driving behavior or their vehicle purchase decisions.
---------------------------------------------------------------------------

    \273\ Letter from Robert H. Cross, California Air Resources
Board, to Dawn Friest, EMA, dated March 2, 2011.
---------------------------------------------------------------------------

    Based on manufacturer-supplied data, the California Air Resources
Board staff established a power-to-weight (GVWR) ratio of 0.024
horsepower (hp)/lb as an approximate threshold in their efforts to
characterize this issue. The vast majority of Class 2b vehicles are
above this threshold today. Those below it tend to be used in
applications where towing is not done extensively and the need for
cargo space is more important than payload weight. Furthermore, it is
possible that this group of vehicles will grow as purchasers adjust to
sustained high fuel prices and when EPA's GHG standards and NHTSA's new
fuel consumption standards take effect.
    In consideration of this matter, we are proposing that, in SFTP
testing of Class 2b vehicles at or below 0.024 hp/lb, manufacturers may
at their option replace the full US06 component of the composite SFTP
emissions with the test results from only the second of the three
emissions sampling bags in the US06 test, generally referred to as the
``highway'' portion of the US06, subject to correspondingly lower SFTP
standards levels discussed above. (These vehicles would still be driven
during the test in the same way as the higher power-to-weight Class 2b
vehicles (over the full US06 cycle) just using best effort (maximum
power) if the vehicle cannot maintain the driving schedule.) The large
majority of Class 2b vehicles, with power-to-weight above 0.024 hp/lb,
would be required to measure and use emissions over the full US06 cycle
in the composite SFTP. We believe that this approach would provide a
robust but repeatable and reliable test for the full range of Class 2b
vehicles, as the highway portion of the US06 retains broad coverage of
vehicle speed/acceleration combinations measured in real-world driving.
    For Class 3 vehicles, which can weigh as much as 14,000 lbs GVWR,
we are also concerned that the full US06 cycle would not provide a
representative drive cycle for SFTP testing. These vehicles are much
larger than the light-duty vehicles that formed the basis for
development of the US06 cycle, and loading them to ALVW for the SFTP
test yields a very heavy test vehicle, not likely to be safely driven
in the real world in the way typified by this aggressive cycle. We
believe that the LA-92 (or ``Unified'') driving cycle developed by CARB
is more representative of Class 3 truck driving patterns and would
produce more robust results for use in SFTP evaluations. Therefore we
are proposing that the LA-92 cycle be used in place of the US06
component of the composite SFTP for Class 3 HDVs. The set of composite
SFTP cycles we are proposing is fully consistent with the MDV LEV III
program.
    Although we consider the highway portion of the US06 cycle
appropriate for low power-to-weight vehicles, we also believe that the
corresponding NMOG+NOX standards should be set at lower
levels than for vehicles with emissions measured over the full US06
test. Our goal is to provide roughly equivalent stringency and avoid
creating an ease-of-compliance incentive to produce vehicles in one
group or the other. We have reviewed the MDV SFTP standards set by the
California Air Resources Board staff and consider them appropriate in
achieving this goal. These proposed standards are included in Table IV-
16.
    HDVs do not have SC03 emissions requirements under the current HDV
standards. Manufacturers of HDVs have indicated that they expect the
SC03 emissions to be consistently lower than either the US06 or the FTP
emissions levels, and therefore the added SC03 testing burden may be
unnecessary. We are therefore proposing that HDV manufacturers have the
option to substitute the FTP emissions levels for the SC03 emissions
results for purposes of compliance. However, we would retain the
ability to determine the composite emissions using SC03 test results in
confirmatory or in-use testing.
b. Enrichment Limitation for Spark-Ignition Engines
    To prevent emissions from excessive enrichment in areas not fully
encountered in the SFTP cycles, we are proposing limitations in the
frequency and magnitude of enrichment episodes for spark-ignition HDVs.
These limitations would be identical to those

for light-duty vehicles discussed in detail in Section IV.A.4.c.
4. HDV Emissions Averaging, Banking, and Trading
    This section describes our proposed approach for emissions credits
related to exhaust emissions. See Section V.C for similar provisions
that apply for evaporative emissions. We are proposing to continue the
current practice of allowing manufacturers to satisfy standards through
the averaging of emissions, as well as through the banking of emissions
credits for later use and the trading of credits with others. There are
a number of facets of this proposed Tier 3 ABT program for HDVs that
would be different from the current program. First, instead of separate
NMHC and NOX credits, manufacturers would earn combined
NMOG+NOX credits, consistent with the form of the standards.
Second, we are proposing to allow manufacturers to accrue a deficit in
their credit balance. Deficits incurred in a model year may be carried
forward for up to 3 model years, but must be made up with surplus
credits after that to avoid noncompliance and possible penalties.
Manufacturers would have to use any new credits to offset any shortfall
before those credits can be traded or banked for additional model
years. We are proposing that credits must be used within 5 years after
they are earned, or otherwise be forfeited. The proposed 5/3-year
credit/deficit life provisions are consistent with our proposed light-
duty Tier 3 approach, the California LEV III program for MDVs, and EPA
programs for controlling GHG emissions from light- and heavy-duty
vehicles.
    Third, as part of our proposal to require chassis certification of
complete diesel HDVs, we are proposing to allow diesel HDVs to
participate in this ABT program without restriction. Currently, they
are not allowed to earn or use ABT credits. We are not proposing to
restrict or adjust credit exchange between diesel and gasoline-fueled
HDVs, consistent with our shift to combined NMOG+NOX
standards that helps to ensure comparable stringency for these two
engine types, and consistent also with the LEV III MDV program.
    We are proposing that credits earned by a Tier 3 HDV may be used to
demonstrate compliance with NMOG+NOX standards for any other
Tier 3 HDV, regardless of size and without adjustment. This effectively
allows manufacturers to plan a comprehensive HDV compliance strategy
for their entire Class 2b and Class 3 product offering, by balancing
credits so as to demonstrate compliance with the standards for both
classes. HDV manufacturers are currently certifying their vehicles to
existing standards without the use of NOX or NMHC credits,
and the levels we are proposing for Tier 3 standards are not based on
any assumption of credit transfers into Tier 3. As a result, we are not
proposing provisions for converting pre-Tier 3 credits, should any
exist at the time, into Tier 3 credits, including for use in the
interim bins.
    In the past we have set caps, called family emission limit (FEL)
caps, on how high emissions can be for vehicles that use credits,
regardless of how many credits might be available. Under our proposed
bin structure, we believe that exhaust emission FEL caps are no longer
relevant for Tier 3 HDVs, as every vehicle must meet whatever standards
apply in the bin chosen for the vehicle by the manufacturer. (The bin
standard becomes the effective FEL.) Indeed, because credits and
deficits are calculated based on the difference between a
manufacturer's fleet average emissions and the fleet average standards
for a given model year, credits are not calculated for individual
vehicle families at all. Under this proposed approach, the standards
for NMOG and NOX in the highest available bin serve the
purpose of the FEL caps in previous programs.
    We are proposing no averaging program for the HDV SFTP program,
because we believe that the bin structure and FTP-centered
NMOG+NOX ABT program provide adequate flexibility for smooth
program implementation, especially in light of our aim to have the FTP
standards be the primary technology forcers. A separate ABT program for
SFTP compliance would add substantial complexity with little benefit,
and, by making it possible to demonstrate robust SFTP control on a
vehicle that lacks commensurate FTP control, could prove at odds with
the primary goal of the supplemental test for HDVs. However, we note
that California's LEV III program does provide some flexibility in this
matter, on a vehicle-for-vehicle basis rather than through use of
emissions credits, and for this reason we request comment on the need
for and considerations surrounding our granting similar flexibility for
HDVs in Tier 3.
5. Feasibility of HDV Standards
    The feasibility assessment, discussed in more detail in Chapter 1
of the draft RIA, recognizes that the proposed Tier 3 program is
composed of several new requirements for Class 2b and 3 heavy-duty
vehicles, which include primarily large gasoline and diesel pick-up
trucks and vans with diverse application-specific designs. These
proposed new exhaust emissions requirements include stringent
NMOG+NOX and PM standards for the FTP and the newly proposed
SFTP, that would as a whole require new emissions control strategies
and hardware in order to achieve the proposed standards. The type of
new hardware that would be required will vary depending on the specific
application and emissions challenges. Additionally, gasoline and diesel
vehicles would require different emissions control strategies and
hardware. The level of stringency for the proposed SFTP
NMOG+NOX standards would generally only require additional
precise control of the engine parameters not necessitated in the past
because of the lack of SFTP requirements. Similarly, the new PM
standards on both the FTP and SFTP cycles would require more precise
control of engine operation on gasoline vehicles while diesels already
equipped with diesel particulate filters would require minimal changes.
The new PM standards may also require that manufacturers consider the
durability of their engines to the 150,000 miles useful life
requirement with respect to engine wear resulting in increased oil
consumption and potentially higher PM emissions.
    In order to assess the technical feasibility of NMOG+NOX
national fleet average FTP standards of 178 mg/mi for Class 2b vehicles
and 247 mg/mi for Class 3 vehicles, we conducted an analysis of
certification data for the HDVs certified in the 2010 and 2011 MYs.
This analysis provided a baseline for the current HDV fleet emissions
performance, as well as the emissions performance specific to the Class
2b and 3 vehicles. The emissions performance of each heavy-duty vehicle
class specific to gasoline and diesel is shown in Table IV-17 below. It
is important to note that the emissions results are only the 4,000 mile
test point results and do not incorporate any deterioration which
manufacturers must account for when certifying to a full useful life
standard. Designs limiting the deterioration of emission control
hardware are critical to meeting the emission standards at the proposed
useful life of the Tier 3 program. Deterioration factors to adjust the
values to the proposed Tier 3 useful life standard of 150,000 miles
were not available however deterioration factors to adjust to 120,000
miles useful life are discussed in the RIA Chapter 1.
    The analysis also reflects the importance of the
NMOG+NOX standard approach where diesels and gasoline MDVs
can balance their combined

NMOG and NOX levels. Diesel vehicles in the analysis produce
very low NMHC emissions (NMOG is not reported for diesels) but higher
NOX emissions, while gasoline vehicles have opposite
performance. The combined standard allows manufacturers to determine
the proper balance of the unique emissions challenges of a diesel or
gasoline vehicle.

                                             Table IV-17--2010/11 Certification Test Results at 4,000 Miles
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               NMHC            NMOG             NOX             CO           NMOG+NOX
--------------------------------------------------------------------------------------------------------------------------------------------------------
Gasoline..........................  Class 2b............  ..............           0.050           0.052           0.041           1.648           0.092
                                    Class 3.............  ..............           0.080           0.083           0.073           2.373           0.156
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                NMHC+NOX
--------------------------------------------------------------------------------------------------------------------------------------------------------
Diesel............................  Class 2b............  ..............           0.037  ..............           0.138           0.195           0.174
                                    Class 3.............  ..............           0.019  ..............           0.249           0.158           0.268
-------------------------------------------------------------------------
Combined Class 2b.......................................................           0.043           0.026           0.089           0.922           0.133
Combined Class 3........................................................           0.050           0.041           0.161           1.265           0.212
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Manufacturers typically certify their vehicles at emissions levels
well below the numerical standards. This difference is referred to as
``compliance margin'' and is a result of manufacturers' efforts to
address all the sources of variability that could occur during the
certification or in-use testing processes and during in-use operation.
These sources of variability include: Test-to-test variability, test
location, build variation and manufacturing tolerances, vehicle
operation (for example: Driving habits, ambient temperature, etc.), and
the deleterious effects of sulfur and other oil and fuel contaminants.
To meet the proposed NMOG+NOX standard of 178 mg/mi for
Class 2b and 247 mg/mi for Class 3 vehicles and establish a compliance
margin for these sources of variability, manufacturers will need to
reduce their emission levels considerably from the levels indicated in
this data set, particularly diesel vehicles.
    However, as discussed above, these emission results do not include
the expected emissions deterioration which would be determined by
manufacturers during development and certification testing. Therefore,
manufacturers would need to further reduce emissions levels in
anticipation of the unavoidable emissions deterioration that will occur
during the useful life of the vehicle. Further, deterioration is a
function of several factors, but it is predominantly due to emissions
control hardware thermal exposure (high temperatures), which is
typically a significant issue on vehicles used for performing work like
Class 2b and 3 vehicles.
    We also expect that the 2011 heavy-duty GHG rule will present new
challenges to manufacturers' emissions performance goals as vehicles
begin to use new engines designed to meet the new GHG
requirements.\274\ Some of these new technologies may result in
emissions challenges that are specific to certain operating conditions.
For example, downsized gasoline engines will likely have improved FTP
exhaust emissions but have increased challenge with the high-load SFTP
requirements. Diesel-fueled vehicles may need to carefully balance
engine controls which reduce GHG emissions but can increase criteria
emissions (NOX).
---------------------------------------------------------------------------

    \274\ 76 FR 57106 (September 15, 2011).
---------------------------------------------------------------------------

    With regard to the ability of the heavy-duty fleet to meet the
proposed PM standards for the FTP and the SFTP, we based our
conclusions on some testing of current HDGVs and the PM performance of
the existing light-duty fleet with similar engines. Testing of two
HDGVs with the highest sales volume (Ford F250 and Chevrolet Silverado
2500), albeit not aged to full useful life, confirmed that they have
similar PM emissions levels as the light-duty counterparts and
therefore also meet the proposed standards for both the Class 2b and
Class 3 configurations. Data from light-duty gasoline vehicles with
similar or common engines with their heavy-duty ``sister'' vehicle
models demonstrates that these vehicles are currently meeting the
proposed Tier 3 FTP PM standards at the Tier 2 useful life mileage of
120,000 miles. Heavy-duty diesel vehicles all are equipped with DPFs
and have no challenges meeting the FTP or SFTP PM standards being
proposed for Tier 3.
    The SFTP test data from the same two heavy-duty vehicles described
above indicates that gasoline vehicles can achieve the proposed
standards for SFTP NMOG+NOX and PM. Since heavy-duty
vehicles are not currently required to comply with any of the SFTP
requirements, manufacturers have not focused on improving the emissions
performance specifically over the SFTP cycles (US06 and SC03).
Therefore, although the limited testing results had a high degree of
variability, several tests met the proposed PM standards for the high
power-to-weight Class 2b vehicles. Consistent with light-duty, vehicles
that are demonstrating high PM on the US06 would need to control
enrichment and oil consumption from engine wear. Manufacturers have
confirmed that they have been implementing product changes to reduce
oil consumption to address both customer satisfaction issues and to
reduce cost of vehicle ownership.
    Given the technologies likely to be applied to meet the proposed
HDV exhaust emissions standards, discussed below, we consider the lead
time available before the standards take effect under all of the
proposed alternatives to be sufficient. HDV manufacturers are already
adopting some of the complying technologies, especially for their
light-duty vehicles, and these can readily be adapted for heavy-duty
applications. In addition, manufacturers have already begun developing
these technologies for HDVs, including diesels, in response to
California's recently adopted LEV III MDV standards which begin to take
effect in the 2015 model year. Finally, as described above in Sections
IV.B.2, IV.B.3, and IV.B.4, our proposed program incorporates a number
of phase-in and alternative compliance provisions that would ease the
transition to final standards without disrupting HD pickup and van
product redesign cycles. Among these is an alternative phase-in that
starts mandatory standards in model year 2019. We invite comment on our
conclusions relating to the feasibility of the proposed program in the
lead time we are proposing.
    We are not proposing relaxed standards for in-use testing of Tier 3

HDVs because we do not believe additional flexibility provisions are
needed to successfully implement the new emission control technologies
in the proposed timeframe. However, we note that the LEV III program
provides such standards for PM, and also for NMOG+NOX in the
lower-emissions MDV bins (those at or below Bin 250 and Bin 400, for
Class 2b and Class 3 vehicles, respectively), and we are taking comment
on the need to do so in Tier 3 as well.
    We also note that the need for NMOG+NOX in-use testing
standards is further mitigated by our proposed structuring of the
NMOG+NOX standards as a declining fleet average with deficit
and credit banking provisions. These provisions provide substantial
flexibility to manufacturers in introducing any new NMOG or
NOX control technologies for which long-term durability is
not yet proven. Manufacturers can place any vehicles for which they
have in-use performance concerns in a higher bin, and this is
facilitated by the fact that, unlike LEV III, our Tier 3 proposal does
not target sales volumes for any individual bins. Comments supporting
relaxed in-use NMOG+NOX standards should therefore address
why, in the absence of these standards, the proposed declining fleet
average standard is not feasible in one or more model years.
    Commenters on this issue are asked to also address the applicable
model years for any such in-use testing standards. The LEV III MDV
program has four different applicability periods based on a combination
of specific model years listed in the regulations (up to 2020) and a
set number of model years (two or five) after a test group is first
certified. Comments are requested on whether it might be preferable to
adopt a simpler approach in Tier 3, such as making in-use testing
standards available in the model years in which standards are phasing
in, that is, through model year 2021.
i. Technologies Likely To Be Applied
    The technologies expected to be applied to vehicles to meet the
lower proposed standards levels would address the emissions control
system's ability to control emissions during cold start. Current
vehicle emissions control systems depend on the time it takes for the
catalyst to light-off, which is typically defined as the catalyst
reaching a temperature of 250 [deg]C. While the specific emissions
challenge is somewhat different for gasoline engines than for diesel
engines, achieving the necessary temperatures in the catalysts is a
common challenge. In order to improve catalyst light-off, the