Empirical Analysis and Program Options for Low Rolling Resistance Tires
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1 Empirical Analysis and Program Options for Low Rolling Resistance Tires Presentation to the International Energy Agency November 16, 2005 Chris Calwell Policy and Research Director
2 Background on Ecos Consulting Ecos Consulting conducts energy-related technical and policy research and implements energy efficiency programs for public interest clients government agencies, utilities, and non-profit groups Ecos develops efficiency metrics and standardized test procedures, conducts measurements, and proposes specifications for labeling and standards programs Ecos receives no funding from individual manufacturers of energyusing products; our specifications are performance-based and technology-neutral Our projects have focused on a wide range of energy-using end uses: incandescent, fluorescent, and LED lighting, appliances, ceiling fans, tires, motor oil, ac-dc power supplies, computer monitors, battery chargers, computers, televisions, and set top boxes
3 Our Goal Is Not to Circumvent Markets, But to Help them Function Better Strategies for more efficient markets: aligning private incentives with societal ones creating a fair basis for competition disclosing full information to buyers & sellers internalizing as many costs as possible rewarding innovation and market leadership. For Ecos, saving energy is less a moral issue than a pragmatic one. If it costs less to save energy than to produce more, why not choose to save it?
4 How the Northwest Plans to Meet New Electricity Needs Between Now and 2025
5 Ecos Consulting s Market Transformation Approach: Research Programs 1. Assess overall energy use and savings opportunity for a product category and the cost effectiveness of advanced technology 2. Define efficiency metric 3. Establish standardized test procedure 4. Obtain data on product performance and efficiency 5. Characterize product differences via a specification line 6. Assess competitive dynamics of market and barriers to success faced by the most efficient current products 7. Propose programs (financial incentives, promotions & targeted procurement) to accelerate sales of the most efficient products 8. Assist with program implementation if needed
6 How Have Other Energy Efficiency Specifications Worked? 175 Computer Monitor Energy Efficiency Specifications CRT 150 LCD Tier 1 Spec Line On Mode Power (watts) Tier 2 Spec Line Proposed Procurement Spec Line of 384 LCDs pass proposed procurement spec Millions of Pixels
7 Power Consumption of Monitors by Size CRTs Failing Procurement Spec LCDs Failing Procurement Spec LCDs Passing Procurement Spec Power Consumption (watts) Screen Size (inches)
8 Research on Behalf of the California Energy Commission Ecos Consulting carried out the following tasks for the CEC: Assess rolling resistance test procedures Develop a tires database Evaluate fuel economy/rolling resistance correlations (with the help of NREL) Assess rolling resistance impacts on other aspects of tire performance Recommend a range of policy options
9 Ecos Consulting provided the CEC with program and policy recommendations on: Test procedure for measuring tire rolling resistance Consumer tire fuel efficiency rating system and other consumer education approaches Investigation of safety implications of more widespread low rolling resistance tire use Mandatory standards for tire efficiency in California Incentive programs to encourage the purchase of more fuelefficient tires Ecos was simultaneously hired by the Energy Foundation to obtain 51 tire samples, test their rolling resistance, and publish findings through Green Seal the first U.S. effort to place third-party rolling resistance data into the public domain.
10 Lifecycle Energy Use and Environmental Impacts of Tires Dominated by In-Use Fuel Consumption Tire Life Cycle Energy Consumption Collection at End-of- Life 0.056% Raw Materials % Compound Recy cling 0.194% Tire Production 5.950% Use (Tire Debris and Fuel) 82% Distribution 0.076% Source: Pirelli Source: Michelin
11 Findings: Tire Rolling Resistance Test Methodology After extensive research, Ecos recommended the use of SAE J2452 test method. Reasons include: Results more predictive of real-world performance than a single-speed test Consistent with testing processes already in use between automakers and OE tire manufacturers Coast-down and test-track measurements can be substantially more expensive and difficult, and not yet widely in use in industry Linkage to NREL s ADVISOR permits car modelspecific fuel economy impact assessments
12 The Market Opportunity: Bringing Low Rolling Resistance to the Replacement Market Ongoing improvements continue from changes in tire chemistry and design. The most efficient tires cut RR by 30% or more, saving 2-6% of fuel use. Market opportunity to greatly increase sales volumes of LRR tires in the replacement market, rather than limiting LRR tires largely to the OE market May be able to increase brand loyalty & repeat purchases if customers can readily buy the same replacement tires that were on their new car Improving the fuel efficiency of replacement tires could reduce California gasoline use by 153 to 461 million gallons per year, cutting the state s fuel bill by up to $1 billion per year.
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14 Savings Estimates Confirmed by Michelin s The Tyre: Rolling Resistance and Fuel Savings
15 Findings & Results: Fuel Economy/Rolling Resistance Correlations With assistance from NREL, Ecos evaluated the effects of vehicle speeds, driving conditions, rolling resistance, tire inflation, and fuel economy Highway cycle showed a return ratio of about 1:5.3 (2% mpg change for every 10% change in RR) Urban cycle showed a return ratio of about 1:9.8 (1% mpg change for every 10% change in RR) Up to 12% fuel consumption difference between high and low RR tires simulated on the same vehicle, but this difference is more extreme than typical Consistent with German test findings and industry data
16 Data from NREL s ADVISOR Modeling 34 Highway Fuel Economy (adjusted HWFET) vs Tire Pressure All Tires Included in Database Fuel Economy (mpg) mpg 2.2 mpg Tire Pressure (psi)
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18 Comparing Inflation Strategies to Low Rolling Resistance Tires Proper inflation pressure can lead to fuel economy benefits, longer tire life and improved safety, but needs constant diligence by the vehicle operator to sustain. The potential fuel economy benefits of low rolling resistance tire design are typically greater in magnitude, longer in duration, and more certain than the benefits from proper inflation alone. These two public policy objectives are not mutually exclusive in any way. With industry already focusing on inflation, governments can likely have the greatest incremental impact by focusing on promotion of LRR tires.
19 Findings & Results: Rolling Resistance and Other Tire Performance Characteristics With funding from the Energy Foundation, Ecos hired Standards Testing Laboratories to test 51 tire models of various popular size & brands for rolling resistance Rolling resistance data plotted against the following available tire performance characteristics: Traction Tread wear Price Overall consumer satisfaction
20 Rolling Resistance and Tire Traction Distribution of Test Tire Traction (average derived from Consumer Reports testing, Tire Rack survey results, and UTQGS traction rating) and Ecos Test Results Composite Traction /70R14 205/55R16 235/75R15 245/75R RRC
21 Rolling Resistance and Tread Wear Distribution of Test Tire Treadwear (average derived from Tire Rack survey results, and UTQGS treadwear rating) and Rolling Resistance Ecos Test Composite Tredwear Rating /70R14 205/55R16 235/75R15 245/75R RRC
22 Rolling Resistance and Retail Tire Price Comparing Retail Tire Prices and Ecos Rolling Resistance Test Results $180 $160 $140 $120 $ /75R16 235/75R15 $80 205/55R16 $60 185/70R14 $40 $20 $ RRC
23 Rolling Resistance and Consumer Satisfaction 10 9 Distribution of Test Tire Overall Quality and Satisfaction (average derived from Tire Rack survey results, and Consumer Reports test) and Ecos Rolling Resistance Testing Composite Overall Satisfaction /70R14 205/55R16 235/75R15 245/75R RRC
24 Findings Presented in Green Seal s Choose Green Report March 2003
25 Recommended Tire Models in Green Seal Choose Green Report
26 German Findings: RR and Wet Braking Performance Wet surface braking behavior vs. rolling resistance for 48 passenger car tires tested in Germany 55 wet braking distance (meters) summer tyres winter tyres limit ecolabel summer tires limit ecolabel winter tires rolling-resistance coefficient c R in %
27 German Findings: RR and Tire Noise Relation between tyre/road noise levels and rolling resistance of 48 tyre types for passenger cars summer tyres winter tyres coast-by level in db(a) limit ecolabel "Blue Angel" 68 limit ecolabel summer tyres limit ecolabel winter tyres rolling-resistance coefficient c R in %
28 German Findings: RR and Aquaplaning 110 Relation between aquaplaning behavior and rolling resistance of 48 tire types for passenger cars aquaplaning speed v A in km/h summer tires winter tires Linear (summer tires) Linear (winter tires) 85 limit ecolabel summer tires limit ecolabel winter tires rolling-resistance coefficient c R in %
29 Rolling Resistance & Solid Waste Issues In general, U.S. OEM tires place more emphasis on low rolling resistance and performance than on longevity (tires not covered by new vehicle warranty), while replacement tires place more emphasis on longevity and low price. Articles from Tire Technology International 2002: However, the available data do not show that LRR is obtainable only by sacrificing longevity. Continued advances in tire design are yielding improvements in both. New research continues to confirm this. See TTI 2004 Low rolling resistance and good wet grip without silica: [R]esults indicate that after 12,500km, no loss in wear performance has been observed.
30 Our Recommended Next Steps to the CEC Accelerate J2452 data collection efforts voluntary or mandatory if needed. Link to ADVISOR. Coordinate and correlate with European LRR tire assessment and ISO 8767 testing Continue expanding public database of RR data and other aspects of tire performance (see for example) Use RR data to modify State procurement process, launch tire labeling, and pilot-test incentive approaches Support R&D and real world testing of LRR tires in cooperation with industry. Goal: increase fuel economy while minimizing performance tradeoffs. Draft mandatory efficiency standards as policy backstop if fuel savings targets are not achieved.
31 Why Do the Tire Manufacturers Opinions about the Potential for Low Rolling Resistance Tires Vary So Widely? Action in Europe and Asia on the Kyoto Protocol is creating markets for saved fuel that do not exist at the federal level in the U.S. (with the exception of CAFÉ standards for new vehicles) Tire manufacturers headquartered in Europe or Asia may be more strongly influenced by high fuel prices and cultural interest in fuel efficiency to see efficient tires as a market opportunity Some manufacturers have made greater investments in low rolling resistance technology than others. Standardized testing of all tires for efficiency, and posting and publicizing the results globally would benefit some manufacturers more than others. The same is true in other markets lighting, appliances, computers, etc. Competition around efficiency creates winners and losers among manufacturers, but competition is healthy and serves the public interest by reducing fuel use and greenhouse gas emissions cost effectively.
32 Creating Markets for Saved Oil US utilities invest about $1.5 billion/year to help their customers consume less electricity & natural gas. Regulators only approve these investments if they are cost effective cheaper than the cost of simply obtaining more supply. No comparable mechanism exists for the transportation sector or for oil markets. As a result, the U.S. routinely invests in supply side measures (offshore drilling, potentially Arctic Refuge) that cost far more than savings on the demand side. Countries with almost no oil left still investing primarily on the supply side.
33 Key Findings from Ecos Consulting s 2004 Report for the National Commission on Energy Policy: Federal Oil Subsidies: How Can They Best Be Targeted? U.S. federal subsidies to the oil industry are $900 million to $1.5 billion per year more than $134 billion since 1968 Amount spent per incremental gallon of gasoline produced is at least $1.34 (according to API) and as much as $5 to $10/gallon Demand side measures low rolling resistance tires, low viscosity synthetic motor oil, dealer incentives for fuel efficiency would cost an average of $0.12 to $0.53 per saved gallon If the federal oil industry subsidies since 1968 had been allocated competitively to the most cost effective options, they could have displaced 430 billion gallons of gasoline -- 10% of cumulative U.S. consumption over the last 37 years U.S. electric utilities have invested about $15 to $20 billion in energy efficiency programs since 1983, reducing energy bills by $35 to $45 billion. This same model system benefit charge funds allocated competitively to cost effective program options can and should be allowed to work in the oil market.
34 Estimating the Cost of a Manufacturer Incentive & Promotion Program for Efficient Tires Low Case Medium Case High Case Fuel economy benefit of LRR tires 1.5% 3.0% 4.5% Incremental cost of one LRR tire $3.00 $2.00 $1.00 Tire lifetime (miles) 40,000 45,000 50,000 Gallons of fuel saved Fuel price per gallon $2.50 $4.00 $5.50 Base case fuel costs over tire lifetime $5,000 $9,000 $13,750 Efficient case fuel costs over tire lifetime $4,926 $8,738 $13,158 Savings over tire lifetime $74 $262 $592 Total upfront program costs/set of tires $16 $15 $13 Payback time (months) Manufacturer incentive cost per saved gallon $0.41 $0.12 $0.04 Program admin & marketing costs/gallon $0.12 $0.10 $0.08 Total program cost of saved gasoline ($/gallon) $0.53 $0.22 $0.12 Total program cost of saved CO2 ($/ton) $53 $22 $12 Assumes 20 mpg vehicle with simple payback analysis (no discounting)
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