Federal Fuel Programs Past/Present/Future. API Detroit Advisory Panel April 16, 2014

Transcription

1 Federal Fuel Programs Past/Present/Future API Detroit Advisory Panel April 16, 2014

2 40 years ago 2

3 OTAQ: Addressing Transportation Air Quality and Climate Light duty Heavyduty Recreational and Commercial Marine Nonroad Gasoline Fuel Quality And Renewables Ships Non road Diesel Locomotives Aircraft 3

4 Reconciling Transportation with the Through sector specify rules LDV/Ts HDVs Nonroad Diesel Nonroad gasoline Locomotive/Marine SI Marine Etc. Environment Typically with emission reductions exceeding 90% and often >99% from uncontrolled levels Through Partnerships 4

5 Comparison of Growth Areas and Emissions Source:

6 OTAQ Office Director Chris Grundler Assessment and Standards Division William Charmley Transportation and Climate Division Karl Simon Compliance Division Byron Bunker Testing and Advanced Technology Division David Haugen Fuels Center Paul Machiele Light Duty and Small Engines Center Heavy duty Onroad and Nonroad Center Large Marine and Aviation Center Data and Testing Center Health Effects, Benefits and Toxics Center Air Quality and Modeling Center 6

7 OTAQ s Authority for Fuel Programs Comes From the CAA 211(a) (b): Fuel and Fuel Additive Registration 211(c): Admin may limit F/FA production/sale (regulate its quality) if 1. F/FA itself causes or contributes to air or water pollution 2. If emission products of the F/FA will impair the performance of vehicle/engine emission control systems 211(f): In use fuels must be Subsim 211(h): Gasoline volatility control and E10 1 psi waiver 211(k): Standards for RFG and Anti dumping for CG 211(o): RFS 211(q)&(v): RFS Anti backsliding study requirements Various other specific provisions 7

8 Fuel Standards (Effective Dates) 1974 Unleaded Gasoline 1979 E10 Ethanol Subsim Waiver 1980 Gasoline Sub-Sim 1989 Phase 1 Gasoline Summer RVP Limits 1991 Phase 2 Gasoline Summer RVP Limits (7.8, 9.0, 1-psi E10 waiver) Winter Oxyfuels Program (39 cities) Highway diesel fuel sulfur control (500 ppm) 1995 Phase 1 RFG and Anti-dumping 1995 Gasoline Detergent Additives Fuel and Fuel Additives Registration 1996 Prohibition on lead Black = Gasoline Red = Diesel Orange = Both/Renewables Phase 2 RFG Mobile Source Air Toxics (MSAT1) Tier 2 Gasoline Sulfur Control (30 ppm avg, 80 cap) 8

9 Fuel Standards (cont.) 2006 EPAct 2005 RFS1 Default Rule 2006 Removal of RFG Oxy Mandate 2006 Ultra-low Sulfur Highway Diesel Fuel (15 ppm) Boutique Fuels List Nonroad, Locomotive and Marine Diesel Fuel (500 ppm) RFS1 Finalized/Implemented; EISA passed requiring RFS2 Ultra-low Sulfur Nonroad Diesel Fuel (15 ppm) 2010 Renewable Fuels Standard 2 Finalized/Implemented MSAT2 -Gasoline benzene 2012 E15 Subsim Waiver/Misfueling Mitigation Rule 2012 Ultra-low Sulfur Locomotive and Marine Diesel Fuel (15 ppm) Low Sulfur Bunker Fuel in ECA (10,000 ppm) 2015 Low Sulfur Bunker Fuel Sulfur (1000 ppm) Black = Gasoline Annual RFS Rules Red = Diesel 2017 Tier 3 -Gasoline Sulfur Orange = Both/Renewables 9

10 Tier 3 FRM Finalized on March 3, 2014 Systems approach to reducing motor vehicle pollution: more stringent vehicle standards enabled by gasoline sulfur control Gasoline sulfur levels reduced from 30 ppm to 10 ppm average beginning 1/1/2017 Vehicle exhaust standards phased in beginning with MY % reduction for NOx+VOC 70% reduction for PM More stringent evaporative emission stds Revised certification test fuel to contain 10% ethanol Creates a harmonized vehicle program Coordinated with California Low Emission Vehicle (LEV) III standards Enables auto industry to produce and sell one vehicle nationwide Part of comprehensive approach to create cleaner, more efficient vehicles Begins phasing in with model year (MY) 2017 Allows coordinated compliance with both LEV III and light duty GHG/fuel economy standards for MY

11 Impacts of Gasoline Sulfur: 5 vs. 28ppm 17 vehicle families; 23 unique vehicles Number of measurements: n = 228 (114 at 5ppm / 114 at 28ppm) Percent reduction at 5 vs. 28 ppm at all mileage levels NO x (p-value) THC (p-value) CO (p-value) NMHC (p-value) CH 4 (p-value) PM Bag % (0.0033) 8.5% (0.0382) 7.5% (0.0552) 7.5% (< ) 13.9% (< ) Bag % (< ) 48.8% (< ) 44.8% (0.0260) 49.9% (< ) Bag % (< ) 40.2% (< ) 20.1% (< ) 49.9% (< ) 29.2% (< ) FTP Wtd 23.0% (0.0180) 13.0% (0.0027) 11.9% (0.0378) 10.6% (0.0032) 25.8% (< ) Model with significant sulfur and mileage interaction term. Where no reduction estimate is provided, the effect is not significant at α =

12 Tier 3 Emission Impacts Reductions in National On Road Inventory Reduction (US Tons) % Reduction Reduction (US Tons) % Reduction NOx 260,000 10% 330,000 25% VOC 48,000 3% 170,000 16% PM % 8,000 16% Benzene 2,000 6% 5,000 26% Lower NOx, VOC, and PM2.5 emissions lead to Moderate to large ozone decreases across the country Small to moderate PM decreases across the country 12

13 Summary of Tier 3 Costs and Benefits Fuel Sulfur Standard 0.65 cents per gallon Vehicle Standards in 2025 $72 per vehicle Annual Cost in 2030 Total Program: $1.5 billion Vehicle Program: $0.76 billion Fuel Program: $0.70 billion Total Monetized Benefits in 2030 (2011$) $6.7 to $19 Billion Benefits outweigh costs by a factor of 4.5 to 13 13

14 Renewable Fuels Standard (RFS) Original RFS program began with the Energy Policy Act of 2005 EISA 2007 significantly amended and expanded the program Statutes direct EPA to implement the program (key consultation roles for USDA, DOE) The RFS is a national standard with 4 categories of renewable fuels EISA significantly increased the size of the program, boosting the longterm goal to 36 billion gallons of renewable fuel by 2022 Explicit definitions for renewable fuels to qualify (e.g., GHG emissions) Inclusion of specific types of waiver authorities Annual rulemakings to establish percentage standards 14

15 Renewable Fuel Standard Statutory Volumes Cellulosic biofuel Biomass based diesel Advanced biofuel Total renewable fuel Conventional (total renewable minus advanced) 2009 na a a a a a a a a a a a: statute sets 1b gal minimum, but EPA may raise requirement 15

16 2014 RFS Volume Proposal First time EPA has faced the need to lower RFS standards other than cellulosic Rapidly rising statutory volumes coupled with reaching the E10 blendwall Proposed lower volumes based on both Cellulosic waiver authority: If EPA lowers cellulosic we may lower advanced and total by up to the same amount General waiver authority: Inadequate domestic supply For total renewable fuel, EPA projected total use of ethanol and non ethanol renewable fuels for 2014, recognizing the practical limits to the use of ethanol For advanced biofuel, EPA discusses various approaches to reducing the RFS volumes to address both the E10 blend wall and limited availability of advanced biofuels to make up for the shortfall in cellulosic biofuel Includes ranges for a number of key inputs related to biofuel production and consumption, and seeks comment on multiple aspects of our proposed approach 16

17 Proposed 2014 Volume Requirements Category Volume (Mean) a Range Cellulosic biofuel 17 mill gal 8 30 mill gal Biomass based diesel 1.28 bill gal 1.28 bill gal b Advanced biofuel 2.20 bill gal bill gal Renewable fuel bill gal bill gal a All volumes are ethanol equivalent, except for biomass based diesel which is actual volume. b EPA is requesting comment on alternative approaches and higher volumes. 17

18 2014 RFS Volume Proposal EPA s intention in this rulemaking is To put the RFS program on a manageable trajectory that will support continued growth in renewable fuels Establish a durable methodology that could be used in 2015 and beyond to reduce market uncertainty The proposal was a starting point in seeking input from the public Comment period closed on January 28 Hoping to finalize in June 18

19 So What s Next? 19

20 What I Wish But the reality is our job is not done 20

21 Projected 2017 Ozone Design Values (with Tier 3). 21

22 Projected 2017 Annual PM 2.5 Design Values (with Tier 3) Annual Standard = 12 ug/m 3 (as of 12/14/12) 22

23 NOx Contribution to Total Emissions in 2017 Mobile Source Trends (post Tier 3) Offroad includes offshore emissions Other Sources 47% Mobile Sources 53% 14,000,000 12,000,000 10,000,000 US Short Tons 8,000,000 6,000,000 4,000,000 Offroad Onroad 2,000,

24 VOC Contribution to Total Emissions in 2017 Mobile Source Trends (post Tier 3) Other Sources 78% Mobile Sources 22% 7,000,000 6,000,000 5,000,000 US Short Tons 4,000,000 3,000,000 2,000,000 Offroad Onroad 1,000,

25 PM2.5 Contribution to Total Emissions in 2017 Other Sources 91% Mobile Sources 9% Mobile Source Trends (post Tier 3) Offroad includes offshore emissions 700, ,000 US Short Tons 500, , , ,000 Offroad Onroad 100,

26 So What Is Next for Fuels? No new grand rules to announce But at a minimum Ongoing implementation of RFS 2015 Annual RFS NPRM Petitions for Reconsideration of 2013 Std Reproposal of cellulosic std Litigation over 2013 Stds RIN Fraud FRM Pathways II FRM (qualifying new biofuels or ways of producing them to generate RINs under the RFS program) Pathways III NPRM Implement the standards we have already finalized Enhance our ability to maintain our fuel quality standards in use Standards not just for gasoline, but also for higher level ethanol blends used in FFVs Streamlining of historical fuel regulations to make them clearly applicable to today s changing marketplace and enable easier implementation and enforcement Continue to evaluate the impacts of fuel quality on emissions and opportunities to improve air quality and human health/welfare 26

27 Impact on E85 Costs of Standards Allowing the Use of Natural Gasoline to Make E85 Blend NGL % CBOB % Butane % RVP Octane AKI $ / gal BTU cost vs E10 E10 90% % E30 30% % E51 49% % E51 2% 47% % E70 30% % E70 29% 1% % E83 17% % E % 2.7% % <1% savings 10% savings 6% savings Ethanol assumed to be $1.90/gal based on a corn price of $4.50/bu July, Midwest gasoline cost data used. RVP of >E10 blends limited to 9 RVP. (ASTM max RVP for E51 83 is 9psi) 27

28 Light Duty GHG Standards 28

29 Heavy Duty Greenhouse Gas Standards Phase 1 ( /19) 530 million barrels less oil 270 MMT lower GHGs $50 billion in fuel savings and benefits Phase 2 (>2018) Proposal: March 31, 2015 Final: March 31, DOE Supertruck 29

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31 Impacts of Fracked Oil and Natural Gas on US Refining 31

32 Beijing February 2014

33 Thank You