Can Fuel Efficiency Standards Be Met Cost-Effectively? The Potential for High-Octane, Low-Carbon Fuels

Transcription

1 Can Fuel Efficiency Standards Be Met Cost-Effectively? The Potential for High-Octane, Low-Carbon Fuels November 13, 2017 Materials will be available at: Tweet about the briefing:

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3 Fuel-Engine Co-Optimization with Ethanol for High Efficiency Engines Robert L. McCormick Washington DC November 13, 2017

4 The Message Liquid fuels will make a substantial contribution in the market for decades to come High efficiency engines benefit consumers, support economic development, and protection of the environment Fuel-Engine Co-Optimization has identified renewable high-octane fuels that allow production of much more efficient engines An ASTM standard for a high octane (100 RON) test fuel to be used in high efficiency engines was developed by a broad industry stakeholder group These engines are based on known technology, but are not on the market today because low-cost fuel is not available 4

5 5 Goal: better fuels and better vehicles sooner Fuel and Engine Co-Optimization What fuel properties maximize engine performance? How do engine parameters affect efficiency? What fuel and engine combinations are sustainable, affordable, and scalable? Are there optimal fuel and engine combinations highest combined efficiency/ghg reduction?

6 6 Goal: better fuels and better vehicles sooner Up to 15% fuel economy improvement for boosted spark ignition and mixed mode Fuel and Engine Co-Optimization What fuel properties maximize engine performance? How do engine parameters affect efficiency? What fuel and engine combinations are sustainable, affordable, and scalable? Are there optimal fuel and engine combinations highest combined efficiency/ghg reduction?

7 External Advisory Board USCAR David Brooks American Petroleum Institute Bill Cannella Fuels Institute John Eichberger Truck & Engine Manufacturers Assn Roger Gault Advanced Biofuels Association Michael McAdams Flint Hills Resources Chris Pritchard EPA Paul Machiele CA Air Resources Board James Guthrie UL Edgar Wolff-Klammer University Experts Ralph Cavalieri (WSU, emeritus) David Foster (U. Wisconsin, emeritus) Industry Expert John Wall (Cummins, retired) EAB advises National Lab Leadership Team Participants represent industry perspectives, not individual companies Entire board meets twice per year; smaller groups meet on targeted issues 7

8 Current fuels constrain engine design 8

9 Engine Knock Limits Engine Efficiency Fuel with adequate knock resistance is required to prevent engine knock Knock occurs when unburned fuel/air mixture autoignites a small explosion in the engine Knock can cause engine damage Spark Plug Burned Gas Piston Flame Front Unburned Fuel/Air Higher knock resistance: ohigher research octane number (RON) ohigher octane sensitivity (RON MON) ohigher evaporative cooling ohigher flame speed 9

10 What is Octane Number? REGULAR PLUS PREMIUM HIGH OCTANE FUEL MINIMUM OCTANE RATING (R+M)/2 METHOD MINIMUM OCTANE RATING (R+M)/2 METHOD MINIMUM OCTANE RATING (R+M)/2 METHOD MINIMUM OCTANE RATING (R+M)/2 METHOD 95 RON 91 RON 93 RON 95 RON 100 Pump octane is the average of research octane (RON) and motor octane (MON) also known as (R + M)/2 o Two tests to cover the full range of engine operating conditions 80 years ago when this was introduced For modern technology engines, RON is the better measure of performance (knock prevention) There is no nationwide (ASTM) standard for minimum octane number in the United States significant limitation on engine efficiency 10

11 How Can Better Knock Resistance Enable Better Engines? Strategies to Increase Engine Efficiency: Increased compression ratio Greater thermodynamic efficiency Engine downsizing/downspeeding Smaller engines operating at low-speed/higher load Less friction at lower engine speeds Turbocharging Recovering energy from the engine exhaust Increase specific power allowing smaller engine Direct injection Fuel evaporation cools the air-fuel mixture All of these strategies can take advantage of more highly knock resistant fuels (higher octane number, octane sensitivity, heat of vaporization, flame speed, and other properties 11

12 ASTM Standard for 100 Research Octane Number Test Fuel Developed by ASTM workgroup with members from the automotive, petroleum, biofuels and other industries Describes properties of fuels for high efficiency SI engines Standard serves as a platform to align fuel formulations for these future engine technologies Planned to serve as basis for commercial high octane fuel standard 12

13 Benefits of Biomass-Sourced Fuel

14 Co-Optima High Performing Boosted SI Blendstocks Identified Representative Tier 3 blendstocks 14

15 Ethanol Is Available Today Ethanol has high RON o RON = 109 o Relatively low cost source of octane Other properties also benefit knock resistance o Octane sensitivity o Heat of vaporization o Flame speed E25 blend would likely provide adequate RON for high efficiency engines Low-Octane BOB Regular Gasoline Premium Gasoline 15

16 Summary The Message Liquid fuels will make a substantial contribution in the market for decades to come High efficiency engines benefit consumers, support economic development, and protection of the environment Fuel-Engine Co-Optimization has identified renewable high-octane fuels that allow production of much more efficient engines An ASTM standard for a high octane (100 RON) test fuel to be used in high efficiency engines was developed by a broad industry stakeholder group These engines are based on known technology, but are not on the market today because low-cost fuel is not available 16

17 High Octane Fuels, Making Better use of Ethanol Brian West Fuels, Engines, and Emissions Research Center EESI High-Octane Fuels Briefing Washington, DC November 13, 2017 Work supported by DOE Office of Energy Efficiency and Renewable Energy Ag/Auto/Ethanol Workgroup

18 Research Octane Number Ethanol is a very effective octane booster ~2/3 rd of octane benefit from first 1/3 rd of ethanol volume percent U.S. EPA opened the door for a high octane ~E30 fuel in Tier 3 rule we allow vehicle manufacturers to request approval for fuel such as a high-octane 30 percent ethanol blend (E30) for vehicles optimized for such fuel Road fuel infrastructure for a midlevel ethanol blend is not trivial (but significantly less complex than many other alternatives) USDA Biofuel Infrastructure Partnership is helping grow number of stations capable of dispensing E25 and higher blends D4806 Data from Stein, et al., SAE Ethanol Content (vol %) 18 Managed by UT-Battelle for the U.S. Department of Energy

19 Brake Thermal Efficiency (%) Industry and DOE Investing In Programs to Quantify Efficiency and GHG Benefits of High Octane Fuels DOE Work supported by Vehicle Technologies Office Bioenergy Technologies Office RON (E0) CR RON (E30) CR RON (E30) CR RON (E30) CR13 Industry Cost-Share, Funds-in, and Tech Support Ford General Motors Fiat Chrysler Coordinating Research Council Ag/Auto/Ethanol Workgroup Thermal Efficiency of Ford EcoBoost (data from Sluder, ORNL) Brake Mean Effective Pressure (kpa) Managed by UT-Battelle for the U.S. Department of Energy

20 A New High Octane Fuel Could Make Better Use of Ethanol s Properties, Moving The U.S. Toward Multiple Goals Engine efficiency can be improved with increasing ethanol and octane rating E25-E40 blend in future vehicles can return equivalent tank mileage as E10 in today s comparable vehicles Energy density penalty is linear with increasing ethanol concentration Power and efficiency gains are non-linear Volumetric Fuel Economy Parity means every gallon of ethanol displaces a gallon of gasoline Efficiency/fuel economy benefit to OEM is significant Can help U.S. Comply with Renewable Fuel Standard Legal to use in >20M legacy FFVs REGULAR Today s Octane Numbers PLUS PREMIUM Future: New Regular? HIGH OCTANE FUEL MINIMUM OCTANE RATING RON METHOD 100 Managed by UT-Battelle for 20 the U.S. Department of Energy 20

21 21 A few example results

22 High Octane Vehicle Demonstration Supported by DOE Bioenergy Technologies Office and follow-on work by Ag/Auto/Ethanol Objective: Demonstrate High Octane fuel benefits at the vehicle level Late model vehicle with 2.0 liter, 4-cylinder, turbocharged GDI engine Efficiency gains of 5-10% demonstrated with high-octane mid-level blends Fuel Economy (E0mpg equivalent) E0_equiv mpg CO2 g/mi +8.5% FTP (City Test) -6.6% CO2 Emissions (g/mi) Piston Blank Cadillac ATS equipped with a 2.0 liter turbocharged, direct-injection engine and manual transmission 9.5:1 Production 10.5:1 Prototype 24.0 Baseline E10 Downsped E10 Downsped E30 Factory Setup 10.5:1 Compression Pistons, Downspeeding Range bars denote max and min of multiple tests

23 Ag/Auto/Ethanol Supporting Mini Cooper E25 Demonstration Vehicle Specs: 2.0 liter turbo GDI Factory pistons and drivetrain Why Mini? Owner s manual calls out E25: Tier 3 E10 and Tier 3 E25 fuels High-Octane E25 provides efficiency and performance gains Property Research Octane Number Motor Octane Number Test Method Tier 3 E10 Value Tier 3 E25 Value ASTM D ASTM D AKI (RON+MON)/ Sensitivity RON-MON * Acknowledgement to BMW for informal technical support

24 Fuel Economy (E0-equiv. mi/gal) Downsizing experiments conducted with Mini Cooper on dynamometer using 2006 Dodge Charger test weight and road load. High-octane E25 on aggressive US06 test provides efficiency gain over regular E US06 Aggressive Driving Test 2.0 Turbo GDI Mini Cooper Tested at 4500 lb Dodge Charger Test Weight (downsize experiment) % 2006 Dodge Charger dynamometer settings used with Mini Cooper vehicle to simulate downsizing E10 E25 Range bars indicate max and min of multiple tests

25 15-80 mph Elapsed Time (s) Extreme downsizing can improve fuel economy at the expense of acceleration performance. Mini is 0.4s quicker with high-octane E25 than with E10. With Charger test weight, vehicle considerably slower; high-octane E25 again provides 0.4s quicker acceleration. Aftermarket Power Module increases boost, improves acceleration time by 2.4 s with HO E25 fuel E10-Mini E25-Mini Dodge Charger dynamometer settings used with Mini Cooper to simulate downsizing 12.0 E10-Charger E25-Charger E25-Charger with Power Module NM Engineering Power Module (PM) intercepts T MAP sensor and increases boost. PM installed by previous owner; PM was disconnected for all tests except these final E25 WOT tests. 6-nm-eng-power-module.html E10 Mini Cooper E25 E10 E25 E25 Dodge Charger Dyno Settings

26 F150 EcoBoost * Currently Under Test * 3.5L Turbocharged V6 Status Baseline testing at ORNL with Tier 3 E10 and E25 ** Complete Piston swap complete Mahle designed, fabricated, and delivered high-compression pistons (target +2.2 CR) More significant CR increase than previous experiments Ford F150 in ORNL Laboratory High Compression Experiments Underway Measurements planned Fuel Economy NMHC/NMOG, CO, NOx emissions PM mass (cold LA4) Acceleration **Same fuels used in Mini Cooper Work supported by Ag/Auto/Ethanol Workgroup Factory 10:1 MAHLE 12.2:1 Ford F150 Pistons 26

27 Factory and High Compression Pistons for Ford EcoBoost Engine from MAHLE Powertrain Factory 10:1 Prototype 12.2:1 27

28 Acceleration Time (s) F150 EcoBoost V6 Acceleration: High Octane E25 Provides performance difference over regular E10 in baseline (factory) test condition E10 E to 75 mph 15 to 80 mph 28

29 FTP Cold-Start PM (mg/mile) F150 EcoBoost V6 Particulate Matter: Baseline tests show E25 provides statistically significant reduction in cold start particulate matter over regular E10. Cold portion of test generally produces ~90% of particulate matter in certification test 12 Cold Start PM Baseline (Cold LA4) [mg/mile] E10 E25 Range Bars Show min and max of three measurements

30 Summary High-octane fuels can enable improved vehicle efficiency (in vehicles designed for their use) Vehicle-level demonstrations have shown efficiency gains can more than offset lowered energy density of added ethanol Vehicle efficiency gains of up to 12% demonstrated Improved torque and power can provide performance improvement (or permit smaller engines) Legacy FFVs, turbo GDI engines (Mini Cooper) show improved acceleration, demonstrate potential for OEMs if fuel widely available 30 Managed by UT-Battelle for the U.S. Department of Energy

31 Contact Information Brian West Deputy Director Fuels, Engines, and Emissions Research Center (865) Managed by UT-Battelle for the U.S. Department of Energy

32 Acknowledgements DOE Vehicle Technologies Office DOE Bioenergy Technologies Office Ag/Auto/Ethanol Workgroup National Corn Growers Illinois Corn Marketing Board Missouri Corn Growers Industry Partners and National Lab Peers Fuels, Engines, Emissions Research Center (FEERC) colleagues 32

33 Backup Slides 33 Managed by UT-Battelle for the U.S. Department of Energy

34 IMEP Recent Experiments Highlight Efficiency Benefits of High Octane Fuel for SI engines Engines can make more torque and power with higher octane fuel Ethanol is very effective at boosting octane number 87 AKI E0 + 30% Ethanol = 101 RON Fuel Increased torque enables downspeeding and downsizing for improved fuel economy For future vehicles, engine and system efficiency can balance lower energy density of ethanol blends = data point E0 (9.2:1) Best Efficiency E30 (12:1) Constant Power 101 RON E30 87 AKI E0 E0 (12:1) Engine Speed (RPM) In a high compression research engine, high-octane E30 enables doubling of available torque compared to 87 AKI E0 fuel - Splitter and Szybist, ORNL 34

35 E10 Regular RSP Time (s) Legacy FFVs Realize Performance Gain with High Octane Mid-Level Ethanol Blends Work supported by DOE Bioenergy Technologies Office Motivation: Measureable performance improvement in legacy FFVs could enable early adoption of High Octane Fuel for Your FFV Tested 4 ethanol tolerant FFVs GMC Sierra Chevrolet Impala Ford F150 Dodge Caravan Prep and Baseline wide open throttle (WOT) test with Regular E10 Prep and WOT test with ~100 RON E30 HIGH OCTANE FUEL For your FFV MINIMUM OCTANE RATING RON METHOD 100 Car and Driver FFV test shows 0.4 second faster 0-60 mph time with E85 Report available: 3 of 4 FFVs show acceleration improvement with E30 ORNL s Sierra results with E30 similar to Car and Driver test with E MPH to 80 MPH WOT Acceleration Time (GMC Sierra FFV, 12 run average) 0.45 seconds 10.1 CR (factory) If half of FFVs on road today filled up with E25 half the time, nation would consume over halfbillion gallons more ethanol E10 High Octane E30 E30

36 Dean Drake Defour Group EESI Briefing Rm. 106 Dirksen Senate Office Building Washington, DC November 13, 2017 Viewing the Vehicle and Fuel as a System: The Economic Implications of High Octane Low Carbon Fuel

37 Not All Vehicles Will Be Battery Powered Certain Models Will Require Liquid Fuel Much More Energy per Pound than Electricity Enables longer range Provides power to move more weight Future Liquid Fuels Should be More Renewable and Cleaner than Today s Gasoline Defour Group LLC 2017 Slide 2

38 Billions of Gallons of Ethanol The U.S. Already Runs on Ethanol Blend Fuels Year Ethanol: To 10% of Our Fuel in 10 Years Today, Most Gasoline is 10% Ethanol (E10) RFS drove ethanol demand & production Refiners chose to make E10 Gasoline blend stock octane lowered Ethanol added to blend stock at terminal to replace that lost octane Finished fuel shipped to retailers Our Fuel Infrastructure Designed for Ethanol 87 Octane E10 is Less Expensive than 87 Octane E0 Gasoline Defour Group LLC 2017 Slide 3

39 What Ethanol Blend Fuel is Best? What We Learned from E10 Fully Using Ethanol s High Octane Lowers Consumer Cost We Can Do Better than E10 Higher octane can enable high efficiency engines With more octane, compliance with standards is less expensive A New Fuel is Best Implemented When: There is widespread support among diverse stakeholders The change is transparent to the public Completing Research to Determine Optimum Blend Ratio Defour Group LLC 2017 Slide 4

40 Impact of High Octane Fuel on New Vehicle Cost Fuel: 98 Research Octane Number (RON) E25 Vehicle: Meets EPA s 2025 Model Year Standards Higher compression ratio engines Widely available E25 fuel EPA s OMEGA Model (Run by Air Improvement Resource) Simulated 2025 MY fleet Estimated overall costs of standards due to technology Fleet average: Savings of $436 per vehicle Buick Enclave SUV: $873 per vehicle Findings Were Presented in SAE Paper Defour Group LLC 2017 Slide 5

41 Two Fuels Could Enable High Efficiency Engines Today s Premium Grade E10 Could be refined to have desired properties Considerably more expensive than today s regular grade E10 Future E25 Performance Grade Fuel Begins with regular E10 More ethanol added to boost octane Should cost the same or less than today s regular E10 Is E10 Premium Fuel an Economically Viable Option? Defour Group LLC 2017 Slide 6

42 E10 Premium vs E25 Performance Grade Fuel Fuel Prices for 2025 to 2055 Spot OPIS Prices in 2016 for: Ethanol Regular Blend Stock Premium Blend Stock Blended and Adjusted to Retail Transportation costs Wholesale to retail markup Extrapolated 2016 Prices to 2055 Using EIA Annual % Increases Annual Gallons Consumed 2025 CAFE Standards Fleet average LD truck average (e.g., Enclave) Adjusted to reflect real world Adjusted for Each Fuel in High Efficiency Engines Using: Fuel energy density & miles traveled per year from EPA Thermal efficiency of fuel/engine combination Defour Group LLC 2017 Slide 7

43 Is Their Enough Ethanol? Due to declining fuel demand, only modest increases in ethanol production are required. RIN Effects? Most studies suggest any effect of RINs on 2016 prices are too small to be measured and impact after 2022 are unknown. Tangential Questions Do EIA s Rates Change? Ethanol volumes changes are minor. Reductions in U.S. gasoline demand likely offset by increased exports. Is the Price of Premium Inflated? Using spot wholesale prices as a starting point eliminates most of the price inflation. Are Additional Infrastructure Costs Significant? Match blending = minimal refinery & terminal changes. New dispenser pumps work with E25. Defour Group LLC 2017 Slide 8

44 Link Between High Efficiency Engines and E25 Compared to a 2025 MY Vehicle W/O High Efficiency Engine, Average 2025 MY Vehicle Modified to Use High Octane Fuel Saves $590 Costs $889 Saves $32 $2.322 Per Gallon in 2025 Cost Difference Vehicle ($436) Fuel ($154) Total ($590) $2.767 Per Gallon (Without E25) Cost Difference Vehicle ($436) Fuel $1,325 Total $889 $1,479 More than E25 $2.542 Per Gallon (With Competition) Cost Difference Vehicle ($436) Fuel $468 Total $32 $662 More than E25 Defour Group LLC 2017 Slide 9

45 Potential Savings Even Greater on Trucks Average 2025 MY Buck Enclave Using High Octane Fuel Saves $1,072 Costs $780 Saves $288 $2.322 Per Gallon in 2025 Cost Difference Vehicle ($873) Fuel ($199) Total ($1,072) $2.767 Per Gallon (Without E25) Cost Difference Vehicle ($873) Fuel $1,653 Total $780 $1,852 More than E25 $2.542 Per Gallon (With Competition) Cost Difference Vehicle ($874) Fuel $586 Total ($288) $785 More than E25 Defour Group LLC 2017 Slide 10

46 Conclusions The Nation Already Runs on an Ethanol Blend Fuel E10 The Ideal Blend May be Higher than 10% Ethanol offers plentiful low-cost octane Automakers want higher octane to comply with standards Going From 10% to 25% Ethanol Creates a Fuel That: Has the octane of premium grade gasoline Costs less than today s regular grade gasoline High Octane Fuel Enables More Efficient Engines But Today s Premium Makes This Strategy Too Expensive Defour Group LLC 2017 Slide 11

47 Backup Slides

48 Consumer Benefits Per Gallon of E10 The Consumer Benefit of E10 Defour Group Study Began May, 2014 Used Weekly OPIS Prices for: Regular gasoline blend stock Premium gasoline blend stock Fuel Ethanol Benefit 10% of Ethanol in Gasoline $0.15 Considers: Octane Fuel energy density Transportation cost differences Charge cooling $0.05 ($0.05) May, 2014 to May, 2017 Compares Cost of a Gallon of 87 Octane E10 vs E0 Defour Group LLC 2017 Slide 13

49 Technology Cost/Vehicle How OMEGA Calculates Compliance Costs Technology Cost Curves $20,000 Passenger Cars LD Trucks BEVs $15,000 $10,000 HEVs $5,000 $0 0% 50% 0% 50% Technology Effectiveness Defour Group LLC 2017 Slide 14

50 Wholesale Price Per Gallon Retail Price Per Gallon $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 Fuel Components Estimating Fuel Prices Premium Blend Stock Ethanol Year Regular Blend Stock $4.50 $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 Retail Fuel E10 Premium Mark-Ups High Low E25 Performance Year E10 Regular Defour Group LLC 2017 Slide 15

51 Is Their Enough Ethanol? 140 Total Ethanol (E100) Consumption by Scenario Consumption (Billion Gallons/Year) Total Gasoline+Ethanol E25 No E AFCM2017 Calendar Year 2055 Ethanol Requirements 2016 Ethanol Requirements Defour Group LLC 2017 Slide 16

52 Can Fuel Efficiency Standards Be Met Cost-Effectively? The Potential for High-Octane, Low-Carbon Fuels: Legal and Regulatory Issues Andrew Varcoe & Adam Gustafson /

53 Boyden Gray & Associates Boyden Gray & Associates is a boutique litigation and public policy firm, continuing C. Boyden Gray s decades of service as counselor to presidents, business leaders, legislators, and regulators on matters of constitutional law, regulatory policy, and international affairs.

54 Overview 1) A Window for Change. EPA has restarted its Mid-Term Evaluation (MTE) of standards for vehicles. EPA is considering how the standards relate to high-octane fuel. 2) Regulatory Opportunities: Fuel Volatility (Reid Vapor Pressure) Regulation. EPA should apply the same fuel volatility standard to higher-ethanol fuel blends that EPA applies to E10. 3) Regulatory Opportunities: Certification Fuel Approval. A new certification fuel would remove obstacles to designing engines optimized for mid-level ethanol blends. 4) Regulatory Opportunities: Other Issues. Obscure, but important.

55 A Window for Change The Mid-Term Evaluation of EPA s Greenhouse Gas Standards and NHTSA s Fuel Economy Standards

56 2012: EPA and NHTSA impose vehicle greenhouse gas and fuel economy standards from 2017 to 2025 In 2012, EPA and NHTSA (DOT) finalized a joint rule requiring passenger cars and trucks to meet increasingly ambitious greenhouse gas and fuel economy standards from model years 2017 to EPA projected an increase from 35.5 mpg in 2016 to 54.5 mpg in EPA-420-F Table 1 - Projected Fleet-Wide Emissions Compliance Targets under the Footprint-Based CO 2 Standards (g/mi) and Corresponding Fuel Economy (mpg) 2016 base Passenger Cars (g/mi) Light Trucks (g/mi) Combined Cars & Trucks (g/mi) Combined Cars & Trucks (mpg)

57 Mid-Term Evaluation ( Reality Check ) In conjunction with the 2012 EPA and NHTSA decision, EPA, NHTSA, and California agreed to complete a joint Mid-Term Evaluation (MTE) of the standards by April 2018 to determine whether those standards remain appropriate. The Mid-Term Evaluation can be seen as a reality check on the feasibility and appropriateness of the standards.

58 Mid-Term Evaluation (2017): Reconsideration by New Administration In January 2017, EPA issued a final determination indicating that the existing standards remain appropriate. In March 2017, EPA Administrator Pruitt and DOT Secretary Chao reopened this evaluation process. EPA intends to make a new final determination by April 1, 2018.

59 Mid-Term Evaluation (2017): New Focus on Octane Octane is a measure of the antiknock properties of a liquid motor fuel. In its notice reopening the comment period (Aug. 21, 2017), EPA invited comment on (inter alia) the impact of the standards on advanced fuels technology, including but not limited to the potential for high-octane blends.

60 Mid-Term Evaluation (2017): New Focus on Octane EPA Administrator Scott Pruitt (Aug. 2017): That 15 billion gallon cap [for conventional biofuels participation in the Renewable Fuel Standard program] maybe it needs to be reset above that. I think we need to consider, as another example on a different topic, high octane with respect to CAFE standards. Audio:

61 Mid-Term Evaluation (2017): New Focus on Octane EPA s new focus on octane is significant: Reducing regulatory barriers to higher-octane fuels could help auto manufacturers comply with standards over the long term -- lowering greenhouse gas emissions and increasing fuel economy, while reducing compliance costs. Before such cost savings can be realized, the regulatory barriers will need to be removed.

62 Background on Octane: Industry Observations Ford supports the development and introduction of an intermediate level blend fuel (E16-E50), with a minimum octane rating of 91 anti-knock index (AKI) that increases proportionally as ethanol is splash-blended on top of the base Tier 3 gasoline emission test fuel. Ford Motor Co., Tier 3 Comments (2013). GM supports the future of higher octane and higher ethanol content in order to provide a pathway to improved vehicle efficiency and lower GHG emissions. GM, Tier 3 Comments (2013). [A] powertrain... optimized for a high-octane, mid-blend ethanol fuel... can simultaneously fulfill what the customer desires performance and economy while reducing the environmental impact. Mercedes-Benz, Tier 3 Comments (2013).

63 Background on Octane: EPA Observations EPA in 2014: [A] higher octane, higher ethanol content test fuel: could help manufacturers who wish to raise compression ratios to improve vehicle efficiency as a step toward complying with the 2017 and later light-duty greenhouse gas and CAFE standards. could help provide a market incentive to increase ethanol use beyond E10. could... enhance the environmental performance of ethanol as a transportation fuel by using it to enable more fuel efficient engines. Tier 3 Final Rule, 79 Fed. Reg. at (2014).

64 Background on Octane: Mid-Term Evaluation (2017) Urban Air Initiative comments (Oct. 2017): The auto-industry needs high-octane fuel to meet the emissions and fuel economy standards. EPA understands that high-octane fuel can be a tool for future compliance. But EPA has not yet removed regulatory barriers that prevent automakers and consumers from using highoctane fuels in the most optimal fashion. To enable cost-effective compliance with the standards, EPA must act to remove outdated and counterproductive barriers to high-octane fuel use.

65 Background on Octane: Mid-Term Evaluation (2017) Auto Alliance comments (Oct. 2017): [T]he Alliance has long advocated transition to a higheroctane gasoline (minimum RON). There are several ways to produce higher-octane grade gasoline, and the Alliance does not advocate any sole or particular pathway. Higher-octane gasoline enables opportunities for use of key energy-efficient technologies, including higher compression ratio engines, lighter and smaller engines, improved turbocharging, optimized engine combustion phasing/timing, and low-temperature combustion strategies.

66 Regulatory Opportunities: Fuel Volatility Regulation EPA should apply the same fuel volatility (Reid Vapor Pressure) standard to higherethanol fuel blends that EPA applies to E10.

67 Reid Vapor Pressure (RVP) Relief Reid Vapor Pressure (RVP) is a measure of fuel volatility. The Clean Air Act s 1 psi (pound per square inch) waiver provision loosens the regulatory Reid Vapor Pressure (RVP) requirement for all fuel blends containing gasoline and 10 percent denatured anhydrous ethanol. 42 U.S.C. 7545(h)(4). In the past, EPA has interpreted this statutory RVP waiver provision to apply only to gasoline with 9-10% ethanol (E9-E10). 40 C.F.R (d)(2). This historical interpretation is in tension with the text of the statute.

68 Reid Vapor Pressure (RVP) Relief The text of the law is best read to apply all fuel blends containing gasoline and 10 percent denatured anhydrous ethanol, id. 7545(h)(5) including ethanol blends above 10% (E15, E25, etc.). This interpretation is supported by (1) the statute s reference to all fuel blends, as well as by (2) the statute s affirmative defense for cases where the ethanol portion of the fuel blend does not exceed its waiver condition under a separate provision that could be used to authorize the use of higher-ethanol blends. Id. 7545(h)(4). If Congress had wanted to limit the RVP waiver to blends no higher than 10 percent ethanol, Congress would have said so. That would have required different statutory language.

69 Reid Vapor Pressure (RVP) Relief EPA acted several years ago to authorize the sale of E15 in the marketplace. E15 is penetrating the marketplace, and is becoming available at more and more U.S. gas stations. As Growth Energy notes, more than 1,000 stations across the country are currently offering E15 to consumers. Yet EPA s past interpretation of the RVP waiver law imposes a major obstacle to E15 sales. Every June (except in so-called RFG areas), convenience store owners and other fuel retailers are required to restrict the sales of E15 to flex-fuel vehicles. When summer driving season starts, many store owners E15 sales drop like a rock.

70 Reid Vapor Pressure (RVP) Relief EPA s past interpretation of the RVP waiver statute is counterproductive. E15 and other midlevel blends have lower RVP (i.e., lower volatility) than E10. As EPA has said, the addition of ethanol to gasoline above 10 percent ethanol decreases blend volatility.

71 EPA Is Reviewing the RVP Relief Issue EPA Administrator Scott Pruitt: With respect to the [RVP] issue, we are looking internally [at allowing] E15 to be sold throughout the year, a national waiver if you will... I very much hope that we can get there, it's just a matter of if the statute permits it or not. [May 2017*] I have directed EPA to actively explore whether it possesses the legal authority to issue such a waiver. The Agency would welcome the opportunity to work with Congress on this important issue, including issuing definitive analysis on the Agency s authority to issue a nationwide RVP issue for E15. [Oct. 2017**] * **

72 Regulatory Opportunities: Certification Fuel Approval A new certification fuel would remove regulatory obstacles to designing engines optimized for mid-level ethanol blends.

73 Certification Fuel Approval A certification fuel (or test fuel) is used to certify (that is, to test) vehicles for compliance with fuel economy and emissions requirements. The makeup of the test fuel thus determines the kinds of engines that car companies are able to design, build, and sell. The makeup of the test fuel also determines the kind of fuel that may lawfully be sold.

74 Certification Fuel Approval When EPA approves a certification fuel, manufacturers are free to design engines optimized to use the certification fuel, and thus to be tested by EPA using that fuel. Approval of a mid-level ethanol certification fuel would remove regulatory obstacles to designing engines optimized for mid-level blends. Such fuels and such engines would help manufacturers comply, cost-effectively, with GHG and fuel economy standards over the long term.

75 Regulatory Opportunities: Other Issues Technical, Obscure, and Important

76 The R-Factor: Fixing EPA s Formula for Fuel Economy Certification

77 R-Factor (Used to Calculate Fuel Economy) EPA should repeal and replace its outdated fuel economy formula. EPA has admitted that part of that formula the R-factor is erroneous and that it unfairly penalizes ethanol blends. The R-factor error creates a disincentive for the deployment of high-efficiency engines that require higher octane ratings and utilize higher ethanol content.

78 R-Factor (Used to Calculate Fuel Economy) The R-factor is intended to ensure that fuel economy testing on today s fuel is equivalent to fuel economy testing in 1975, by adjusting for the lower energy content of ethanol. As EPA has acknowledged, the current EPAmandated R-factor of 0.6 is erroneous, and fails to achieve its statutory purpose. The auto industry has asked EPA to correct the R-factor to 1.0. In response, EPA has acknowledged that the current R-factor is wrong, suggesting that a corrected value might lie between 0.8 and 0.9.

79 R-Factor (Used to Calculate Fuel Economy) EPA has not yet acted to fix the R-factor problem. However, EPA could solve the R-factor problem for any new certification fuel (for example, a new midlevel ethanol blend fuel) by approving a new fuel economy formula for the new fuel.

80 Lifecycle Analysis: What Are the Real-World Greenhouse Gas Impacts of Corn Ethanol?

81 Lifecycle Analysis: Outdated Models Can Skew Trade and Policy Discussions Three federal agencies have analyzed the lifecycle GHG impacts of corn ethanol. EPA s analysis from 2010 needs updating, and is in conflict with more recent analyses from DOE and USDA. Outdated lifecycle analyses could have adverse trade impacts. Other countries might mistakenly award U.S. ethanol inadequate credit for GHG benefits. Outdated lifecycle analyses could skew policy discussions, leading stakeholders and commenters to misapprehend the GHG benefits of U.S. ethanol production and current agricultural practices.

82 Emissions Model Reform: What Are the Real-World Air Quality Impacts of Ethanol Blends?

83 EPA Vehicular Emissions Models: Why Do They Matter? EPA s vehicular emissions model, MOVES2014a ( MOVES = MOtor Vehicle Emission Simulator ), estimates the pollution produced by a given fleet of vehicles running on fuel with defined parameters. States that are in nonattainment with EPA air quality standards must develop state implementation plans (SIPs), which show how those states will attain the standards. SIPs which can include vehicle and fuel policies. EPA requires nonattainment states to use MOVES in developing SIPs. Errors in the model can limit a state s compliance options.

84 MOVES2014a: Three big problems Because of the following defects, MOVES2014a erroneously reports that higher ethanol concentrations increase emissions: 1) Tailpipe Emission Factors. MOVES2014a relies on a flawed study that failed to control for the confounding variables that resulted from its match-blending methodology. 2) Evaporative Emission Factors. MOVES2014a s fuel adjustment for ethanol s permeation emissions is wrong; the model relies on studies systematically biased against ethanol. 3) Default Fuel Parameters. MOVES2014a requires states to use default parameters that contradict real-world market surveys. These errors make it harder for states to use ethanol as a tool to improve air quality.

85 MOVES2014a: Next Steps To correct the model s errors: Urban Air Initiative (UAI) filed a Request for Correction of Information (together with Kansas, Nebraska, and the Energy Future Coalition), asking EPA to fix its mistaken emission estimates for ethanol. EPA s current target due date is November 30, UAI is participating in EPA s MOVES Review Work Group to advise EPA on the MOVES model s errors and to suggest corrections for a revised model to be issued as early as 2018.

86 Overview 1) A Window for Change. EPA has restarted its Mid-Term Evaluation (MTE) of standards for vehicles. EPA is considering how the standards relate to high-octane fuel. 2) Regulatory Opportunities: Fuel Volatility (Reid Vapor Pressure) Regulation. EPA should apply the same fuel volatility standard to higher-ethanol fuel blends that EPA applies to E10. 3) Regulatory Opportunities: Certification Fuel Approval. A new certification fuel would remove obstacles to designing engines optimized for mid-level ethanol blends. 4) Regulatory Opportunities: Other Issues. Obscure, but important.

87 Thank you. Andrew Varcoe & Adam Gustafson /

88 Can Fuel Efficiency Standards Be Met Cost-Effectively? The Potential for High-Octane, Low-Carbon Fuels What did you think of the briefing? Please take 2 minutes to let us know at: Materials will be available at: Tweet about the briefing: