PROPOSED HEAVY-DUTY VEHICLE AND ENGINE GREENHOUSE GAS EMISSION REGULATIONS UNDER CEPA, 1999 Heavy Duty Vehicle GHG Emissions & Fuel Efficiency in Canada Conference April 30, 2012.
Table of Content Context and Background Overview of the Proposed Heavy-duty Vehicle and Engine Greenhouse Gas Emission Regulations Next Steps Page 2
Context and Background Proposed Heavy-Duty Vehicle and Engine Greenhouse Gas Emission Regulations Page 3
Environment Canada s Recent Regulatory History. 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Air Pollutants 2006+ MYs GHGs 2011-2016 MYs Emission Control Area (Sulphur in Diesel Fuel) Air Pollutants 2004+ MYs Air Pollutants Tier 2/3 2006+ MYs GHGs 2014-2018 MYs GHGs 2017-2025 MYs Air Pollutants Phase I/II 2005+ MYs Air Pollutants 2012+ MYs Page 4 Air Pollutants Tier 4 2012+ MYs On-Board Diagnostic 2013+ MYs
Contribution of On-Road Heavy-Duty Vehicles to Climate Change. Transportation is one of the largest sources of GHGs in Canada 22% of total emissions in 2005 On-road heavy-duty vehicles represent approximately 6% of total emissions in 2005 Canada s s GHG Emissions - 2005 Agriculture Waste and 74 Mt Others Transportation 54 Mt 164 Mt Buildings 80 Mt The proposed regulations would result in environmental gains that would contribute toward Canada s commitment to reducing total GHG emissions by 17% from 2005 levels by 2020 Emission- Intensive Trade- Exposed Industries 80 Mt Oil & Gas 153 Mt Electricity 126 Mt Page 5
Actions on Development of on-road HDV GHG Emission Regulations. May 2010: the Government of Canada jointly announced with the U.S its intent to develop GHG emission standards October 2010 & August 2011: Canada released two progressively more detailed consultation documents outlining the general direction for consideration in the Canadian regulations In addition, Environment Canada co-hosted with Transport Canada three stakeholder consultation meetings comprised of key industry stakeholders, provinces and territories and ENGOs April 13 2012: Minister Kent announced the proposed Heavy-duty Vehicle and Engine Greenhouse Gas Emission Regulations April 14 2012: Canada published the proposed Regulations in the Canada Gazette, Part 1 initiating a formal 60-day comment period Page 6
United States Regulations On August 9, 2011, the U.S. released a joint rulemaking, by the National Highway Traffic Safety Administration and the Environmental Protection Agency (EPA), prescribing fuel consumption and GHG emission standards for on-road heavyduty vehicles and engines for model years 2014 and later The U.S. EPA regulations, under the Clean Air Act, implement the GHG emission standards Canada s proposed Regulations fully align with the GHG emission standards of the US EPA Page 7
Overview of the Proposed Regulations Proposed Heavy-Duty Vehicle and Engine Greenhouse Gas Emission Regulations Page 8
Highlights of Proposed Regulations Lifetime GHG emission reductions and of 2014-2018 MY vehicles: 19.0 Mt GHG emission reductions in 2020 compared to business as usual: 3Mt equals 650,000 personal vehicles off the roads Lifetime net benefits of 2014-2018 MY vehicles: $4.2 billion (net present value), mostly through fuel savings Increased vehicle purchase prices is expected to be recouped by fuel savings in less than 1 year in most cases Manufacturers of new heavy-duty vehicles will be able to build GHGcompliant vehicles by incorporating cost-effective and currently available off-the-shelf technologies Page 9
Who Would We Regulate? The proposed Regulations would introduce GHG emission standards for new on-road heavy-duty vehicles and engines of the 2014 and later model years The proposed Regulations would apply to any person who is engaged in the business of manufacturing or importing new on-road heavy-duty vehicles or engines in Canada for the purpose of sale Would NOT apply to owners or operators of heavy-duty vehicles and engines Page 10
What Would We Regulate? Vehicles from full-size pick-up trucks to combination tractors, and including a wide variety of vocational vehicles such as: freight, delivery, service, cement, garbage and dump trucks, as well as buses CLASS 2B 8,501 to 10,000 lb Proposed Regulations would NOT apply to vehicles that are not designed for highway use, such as farm equipment, off-road machinery, and heavy equipment Trailers would NOT be subject to the Regulations Page 11
What Are the Emission Standards? Overview: Proposed Regulations include emissions standards for the following GHGs from transportation: carbon dioxide (CO 2 ), nitrous oxide (N 2 O), methane (CH 4 )andhydrofluorocarbons (HFCs) Proposed emission standards take into account the significant differences between three broad categories of heavy-duty vehicles and recognize the utility and work of vehicles Class 2B and 3 pick-up trucks and vans Class 7 and 8 combination tractors (i.e., semi-trucks) Class 2B through 8 vocational vehicles The proposed Regulations include separate engine and vehicle emission standards for combination tractors and vocational vehicles Page 12
CO 2 Emission Standards Class 2B and 3 Pick-ups and Vans Proposed emissions standards: based on a fleet average measured in grams of CO 2 per mile (g/mile) Proposed CO 2 average standard varies based on a work factor : Work factor is based on a vehicle s payload capacity, towing capacity & 4WD capability Vehicles with larger payloads, higher towing capacities and 4WD capabilities would be permitted to emit more GHGs WF = 0.75 x (GVWR Curb Weight + xwd) + 0.25 x (GCWR GVWR) xwd = 500 lbs if vehicle has 4WD/AWD, otherwise zero Vehicles equipped with spark-ignition and compression-ignition engines would have separate targets Page 13
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CO 2 Emission Standards Combination Tractors This category would include heavy-duty trucks designed to haul a trailer Proposed vehicle emission standards: are measured in grams of CO 2 per cargo ton-mile (g/ton-mile) are categorized by vehicle weight class, roof height and cab type Tractor Class Characteristics CO 2 emission standard for the 2014 to 2016 model years CO 2 emission standard for the 2017 and after Class 7 Low-roof (all cab styles) 107 104 Mid-roof (all cab styles) 119 115 High-roof (all cab styles) 124 120 Class 8 Low-roof day cab 81 80 Low-roof sleeper cab 68 66 Mid-roof day cab 88 86 Mid-roof sleeper cab 76 73 High roof day cab 92 89 High roof sleeper cab Page 15 75 72
CO 2 Emission Standards Combination Tractor Engines Proposed engine emission standards: are measured in grams of CO 2 per brake horsepower-hour (g/bhp-hr) vary based on vehicle class The CO 2 standards would become more stringent in 2017 model year Model year 2014 to 2016 2017 and after Medium heavy-duty 502 487 Heavy heavy-duty 475 460 Page 16
CO 2 Emission Standards Vocational Vehicles. Includes all remaining trucks and buses of all sizes and functions not covered in previous two groups Proposed vehicle emission standards are: measured in grams of CO 2 per ton-mile (g/ton-mile) categorised by vehicle weight class Vocational Vehicle Class Classes 2B, 3, 4 and 5 Classes 6 and 7 Classe 8 CO 2 emission standard for model years 2014 to 2016 388 234 226 CO 2 emission standard for 2017 and after 373 225 222 Page 17
CO 2 Emission Standards Vocational Vehicle Engines Proposed engine emission standards: Are measured in g/bhp-hr vary based on vehicle class and fuel type Vocational compression-ignition engine (diesel) Model year Light heavyduty Medium heavyduty Heavy heavyduty 2014 to 2016 600 600 567 2017 and after 576 576 555 Vocational spark-ignition engine (gasoline) Model year 2016 and after All Ranges 627 Page 18
Other GHG Emission Standards HFCs, CH 4 and N 2 O Refrigerant leakage standard 1.5 % refrigerant leakage per year and would apply to pickup trucks, vans and tractors for systems with refrigerant capacity greater than or equal to 734 grams For systems with a refrigerant capacity of less than 734 grams, the standard would equal 11.0 grams per year. Proposed CH 4 and N 2 O emission standards for engines and pick-up trucks and vans Pick-up trucks and vans: 0.05 g/mile Engines: 0.10 g/bhp-hr Normalized by their relative global warming potential CO 2 credits could be used to offset CH 4 and N 2 O deficit Designed to prevent emission increases Page 19
How would Compliance be Assessed? Companies would be required to demonstrate compliance using prescribed emissions testing procedures or simulation modelling procedures, aligned with the U.S.: Pick up trucks and vans: prescribed test cycles on a chassis dynamometer (same basic test procedures as LDV GHG) Tractors and vocational vehicles: computer simulation model (GEM) (see next slide) Engines: prescribed test cycles on a engine dynamometer EPA Certificates would be accepted to demonstrate compliance with the emissions standards Page 20
New Feature: Computer Simulation Modeling. Companies would use a simulation model to assess the performance of vocational vehicles and tractors equipped with one or more of the following non-engine-related technologies aerodynamic fairings low rolling resistance tires speed limiter weight reduction idle reduction technology Offers accurate and cost-effective method of compliance assessment Model can be freely downloaded from EPA website Page 21
Proposed Compliance Flexibilities A CO 2 emission credit system: would allow companies to generate, bank and trade emission credits would allow vehicles and engines with emission levels worse or better than standard, provided that their average fleet emission level does not exceed the standard Credits valid for 5 years; deficits must be offset within 3 years Credits and deficits monitored through annual reporting Incentives for: Advanced technology vehicles (electric, fuel cell, hybrid vehicles, Rankine-cycle) Innovative technologies resulting in GHG emission reductions that are not accounted for during test procedures Page 22
Proposed Compliance Flexibilities Optional early credits for all 2013 model year vehicles and electric vehicles of 2011-2013 model years Credit multiplier of 1.5 for advanced technology vehicles and early credits Alternative phase-in requirements for pick-up trucks and vans and for engines Exemptions for certain classes and applications Vocational tractors and off-road vehicles Low-volume exemption (imported or manufactured less than 100 vehicles) Page 23
Administrative Requirements Proposed reporting requirements Annual preliminary report December 1 st before model year only for Class 2b and 3 End of model year report May 15 th following model year Environmental performance of vehicles Credit/deficit calculations Several administrative provisions would be aligned with those under the On-Road Vehicle and Engine Emission Regulations: National emissions mark Maintenance and submission of records Application for exemptions Notices of defect Page 24
Next Steps Proposed Heavy-Duty Vehicle and Engine Greenhouse Gas Emission Regulations Page 25
Proposed Roll-Out Canada Gazette, Part I publication was April 14, 2012 Formal 60-day consultation period ends June 13, 2012 All interested parties are invited to submit written comments Consultation session to be held in May Final Regulations targeted for publication in Canada Gazette, Part II later in 2012 Proposed Regulations would apply starting with the 2014 model year Implementation dates would be the same as that of the U.S. Page 26
Emails and Contacts Submission of Comments: GHGRegDev_Vehicles@ec.gc.ca or to the attention of: Mark Cauchi, Director, Transportation Division, Environment Canada, 351 St. Joseph Blvd., Gatineau, Quebec, K1A 0H3 Questions: Stéphane Couroux, A/Chief, Greenhouse Gas Regulatory Development and Marine Analysis Section, Environment Canada, Tel.: (819) 934-6013, email: stephane.couroux@ec.gc.ca Louis-Philippe Gagné, Senior Program Engineer, Tel: (819) 956-1099, email: louis-philippe.gagne@ec.gc.ca Page 27