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Alternative Methods for Calculating Off-Cycle Credits Under the Light-Duty Vehicle Greenhouse Gas Emissions Program: Applications From Ford Motor Company, American Honda Motor Company, and Nissan North America, Inc.

American Government

Alternative Methods for Calculating Off-Cycle Credits Under the Light-Duty Vehicle Greenhouse Gas Emissions Program: Applications From Ford Motor Company, American Honda Motor Company, and Nissan North America, Inc.

Byron J. Bunker
Environmental Protection Agency
6 February 2020

[Federal Register Volume 85, Number 25 (Thursday, February 6, 2020)]
[Pages 6945-6947]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-02370]




Alternative Methods for Calculating Off-Cycle Credits Under the 
Light-Duty Vehicle Greenhouse Gas Emissions Program: Applications From 
Ford Motor Company, American Honda Motor Company, and Nissan North 
America, Inc.

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice.


SUMMARY: EPA is requesting comment on applications from Ford Motor 
Company (``Ford''), Honda Motor Company (``Honda''), and Nissan North 
America, Inc. (Nissan) for off-cycle carbon dioxide (CO2) 
credits under EPA's light-duty vehicle greenhouse gas emissions 
standards. ``Off-cycle'' emission reductions can be achieved by 
employing technologies that result in real-world benefits, but where 
that benefit is not adequately captured on the test procedures used by 
manufacturers to demonstrate compliance with emission standards. EPA's 
light-duty vehicle greenhouse gas program acknowledges these benefits 
by giving automobile manufacturers several options for generating 
``off-cycle'' CO2 credits. Under the regulations, a 
manufacturer may apply for CO2 credits for off-cycle 
technologies that result in off-cycle benefits. In these cases, a 
manufacturer must provide EPA with a proposed methodology for 
determining the real-world off-cycle benefit. Ford, Honda, and Nissan 
have submitted applications that describe methodologies for determining 
off-cycle credits from technologies described in their applications. 
Pursuant to applicable regulations, EPA is making these off-cycle 
credit calculation methodologies available for public comment.

DATES: Comments must be received on or before March 9, 2020.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ- 
OAR-2020-0015, to the Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting 
comments. Once submitted, comments cannot be edited or withdrawn. The 
EPA may publish any comment received to its public docket. Do not 
submit electronically any information you consider to be Confidential 
Business Information (CBI) or other information whose disclosure is 
restricted by statute. Multimedia submissions (audio, video, etc.) must 
be accompanied by a written comment. The written comment is considered 
the official comment and should include discussion of all points you 
wish to make. The EPA will generally not consider comments or comment 
contents located outside of the primary submission (i.e. on the web, 
cloud, or other file sharing system). For additional submission 
methods, the full EPA public comment policy, information about CBI or 
multimedia submissions, and general guidance on making effective 
comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

FOR FURTHER INFORMATION CONTACT: Roberts French, Environmental 
Protection Specialist, Office of Transportation and Air Quality, 
Compliance Division, U.S. Environmental Protection Agency, 2000 
Traverwood Drive, Ann Arbor, MI 48105. Telephone: (734) 214-4380. Fax: 
(734) 214-4869. Email address: french.roberts@epa.gov.


I. Background

    EPA's light-duty vehicle greenhouse gas (GHG) program provides 
three pathways by which a manufacturer may accrue off-cycle carbon 
dioxide (CO2) credits for those technologies that achieve 
CO2 reductions in the real world but where those reductions 
are not adequately captured on the test used to determine compliance 
with the CO2 standards, and which are not otherwise 
reflected in the standards' stringency. The first pathway is a 
predetermined list of credit values for specific off-cycle technologies 
that may be used beginning in model year 2014.\1\ This pathway allows 
manufacturers to use conservative credit values established by EPA for 
a wide range of technologies, with minimal data submittal or testing 
requirements, if the technologies meet EPA regulatory definitions. In 
cases where the off-cycle technology is not on the menu but additional 
laboratory testing can demonstrate emission benefits, a second pathway 
allows manufacturers to use a broader array of emission tests (known as 
``5-cycle'' testing because the methodology uses five different testing 
procedures) to demonstrate and justify off-cycle CO2 
credits.\2\ The additional emission tests allow emission benefits to be 
demonstrated over some elements of real-world driving not adequately 
captured by the GHG compliance tests, including high speeds, hard 
accelerations, and cold temperatures. These first two methodologies 
were completely defined through notice and comment rulemaking and 
therefore no additional process is necessary for manufacturers to use 
these methods. The third and last pathway allows manufacturers to seek 
EPA approval to use an alternative methodology for determining the off-
cycle CO2 credits.\3\ This option is only available if the 
benefit of the technology cannot be adequately demonstrated using the 
5-cycle methodology. Manufacturers may also use this option to 
demonstrate reductions that exceed those available via use of the 
predetermined list.

    \1\ See 40 CFR 86.1869-12(b).
    \2\ See 40 CFR 86.1869-12(c).
    \3\ See 40 CFR 86.1869-12(d).

    Under the regulations, a manufacturer seeking to demonstrate off-
cycle credits with an alternative methodology (i.e., under the third 
pathway described above) must describe a methodology that meets the 
following criteria:
     Use modeling, on-road testing, on-road data collection, or 
other approved analytical or engineering methods;
     Be robust, verifiable, and capable of demonstrating the 
real-world emissions benefit with strong statistical significance;
     Result in a demonstration of baseline and controlled 
emissions over a wide range of driving conditions and number of 
vehicles such that issues of data uncertainty are minimized;
     Result in data on a model type basis unless the 
manufacturer demonstrates that another basis is appropriate and 
    Further, the regulations specify the following requirements 
regarding an application for off-cycle CO2 credits:

[[Page 6946]]

     A manufacturer requesting off-cycle credits must develop a 
methodology for demonstrating and determining the benefit of the off-
cycle technology and carry out any necessary testing and analysis 
required to support that methodology.
     A manufacturer requesting off-cycle credits must conduct 
testing and/or prepare engineering analyses that demonstrate the in-use 
durability of the technology for the full useful life of the vehicle.
     The application must contain a detailed description of the 
off-cycle technology and how it functions to reduce CO2 
emissions under conditions not represented on the compliance tests.
     The application must contain a list of the vehicle 
model(s) which will be equipped with the technology.
     The application must contain a detailed description of the 
test vehicles selected and an engineering analysis that supports the 
selection of those vehicles for testing.
     The application must contain all testing and/or simulation 
data required under the regulations, plus any other data the 
manufacturer has considered in the analysis.
    Finally, the alternative methodology must be approved by EPA prior 
to the manufacturer using it to generate credits. As part of the review 
process defined by regulation, the alternative methodology submitted to 
EPA for consideration must be made available for public comment.\4\ EPA 
will consider public comments as part of its final decision to approve 
or deny the request for off-cycle credits.

    \4\ See 40 CFR 86.1869-12(d)(2).

II. Off-Cycle Credit Applications

A. Valeo Air Conditioning Compressor With Variable Bleed Valve

    Using the alternative methodology approach discussed above, Ford is 
applying for credits for an air conditioning compressor manufactured by 
Valeo that results in air conditioning efficiency credits beyond those 
provided in the regulations. Valeo's air conditioning compressor with 
variable bleed valve improves energy consumption compared to the 
current generation compressor technology. Current technology is a 
compromise of all load conditions. The variable bleed valve improves 
the coefficient of performance under low and mid load conditions 
decreasing CO2 emissions. The variable bleed valve is 
designed to vary the bleed valve diameter, making it smaller to control 
internal control gas for improved coefficient of performance, but also 
be able to increase for liquid start up conditions. The optimized 
valves reduce losses within the A/C compressor increasing efficiency. 
The additional variable bleed valve improves the compressor over 
previous externally-controlled variable displacement compressor 
    The credits calculated for the Valeo air conditioning compressor 
with variable bleed valve would be in addition to the credits of 1.7 
grams/mile for variable-displacement A/C compressors already allowed 
under EPA regulations.\5\ However, it is important to note that EPA 
regulations place a limit on the cumulative credits that can be claimed 
for improving the efficiency of A/C systems, and EPA has typically 
required that A/C-related technologies for which credits are sought 
through the off-cycle program must also comply with these limits. The 
rationale for the limits is that the additional fuel consumption of A/C 
systems can never be reduced to zero, and the limits established by 
regulation reflect the maximum possible reduction in fuel consumption 
projected by EPA for a typical A/C system. To date, EPA has required 
that these limits, or caps, on credits for A/C efficiency be applied to 
A/C efficiency credits granted under the off-cycle credit approval 
process. In other words, EPA has required that cumulative A/C 
efficiency credits for an A/C system--from the A/C efficiency 
regulations and those granted via the off-cycle regulations--comply 
with the stated limits.

    \5\ See 40 CFR 86.1868-12.

    The Ford application contains a detailed analysis supporting their 
conclusion that the variable bleed valve is complementary to other A/C 
efficiency technologies and, as such, should not be limited by the cap. 
However, the fundamental approach of the A/C efficiency improvement 
program is premised on limits to the overall impact of the A/C system 
on CO2 and fuel economy, and EPA therefore established caps 
based on a finite level of improvement (i.e. A/C operation will always 
use some energy, fuel or electric power) that is achievable. These caps 
or limits to improvements in A/C efficiency were considered when 
establishing the GHG standards. Had the Agency believed that 
improvements beyond the menu were possible, the caps may have been 
different and the level of the final GHG standard may have been set to 
a different stringency level. While we still believe that the 
opportunity for improvements has a theoretical limit, we understand 
that technologies may exist outside of the A/C credit menu that go 
beyond the current cap limits and that provide real-world 
CO2 reductions.
    Since both the total impact of the A/C system on CO2 
used to establish the GHG standards was premised on some nominal car 
and truck levels not specific to any vehicle, it is difficult to use 
the test results on any individual technology to determine what a new 
cap or limit should be, since the A/C system operates with interactions 
across all A/C components and parts of the system. This is consistent 
with Ford's identification of system interactions with the Denso SAS 
and Valeo VBV compressors and the A/C menu technologies. The Agency 
believes a reasonable balance may be to continue to use the nominal 
values for the total impact of the A/C system (11.9 grams per mile for 
cars and 17.2 grams per mile for truck), but then use AC17 test results 
to establish a higher cap or limit on the additional technologies 
beyond the menu technologies. The results of the AC17 test could be 
used to establish a ratio of CO2 emissions or energy used 
with the technology improvements to total A/C usage without the 
technologies. This ratio could then be used with the previously 
established values mentioned above for the average car or truck A/C 
usage impacts to establish a new, A/C system-specific, cap that 
accounts for the actual A/C-related emissions of the system and all the 
A/C efficiency technologies. This is a conceptual framework that 
manufacturers might use to support off-cycle petitions for A/C system 
credits. The Agency requests comment on this or similar approaches that 
make use of the AC17 test procedure to demonstrate A/C-related credits 
and determine an expanded cap on credits. EPA continues to evaluate 
Ford's rationale and will make a final decision after evaluating any 
public comments received on this issue.

B. High-Efficiency Alternators

    Using the alternative methodology approach discussed above, Honda 
and Nissan are applying for credits for model years 2017 and later for 
off-cycle credits using the alternative demonstration methodology 
pathway for high-efficiency alternators. Automotive alternators convert 
mechanical energy from a combustion engine into electrical energy that 
can be used to power a vehicle's electrical systems. Alternators 
inherently place a load on the engine, which results in increased fuel 
consumption and CO2 emissions. High efficiency alternators 
use new technologies to reduce the overall load on the engine yet 

[[Page 6947]]

to meet the electrical demands of the vehicle systems, resulting in 
lower fuel consumption and lower CO2 emissions. Some 
comments on EPA's proposed rule for GHG standards for the 2016-2025 
model years suggested that EPA provide a credit for high-efficiency 
alternators on the pre-defined list in the regulations. While EPA 
agreed that high-efficiency alternators can reduce electrical load and 
reduce fuel consumption, and that these impacts are not seen on the 
emission test procedures because accessories that use electricity are 
turned off, EPA noted the difficulty in defining a one-size-fits-all 
credit due to lack of data. Since then, however a methodology has been 
developed that scales credits based on the efficiency of the 
alternator; alternators with efficiency (as measured using an accepted 
industry standard procedure) above a baseline value could get credits. 
EPA has previously approved credits for high-efficiency alternators 
using this methodology for Ford Motor Company, General Motors 
Corporation, Fiat Chrysler Automobiles, Hyundai, Kia, and Toyota Motor 
Company. Details of the testing and analysis can be found in the 
manufacturer's applications.

III. EPA Decision Process

    EPA has reviewed the applications for completeness and is now 
making the applications available for public review and comment as 
required by the regulations. The off-cycle credit applications 
submitted by the manufacturer (with confidential business information 
redacted) have been placed in the public docket (see ADDRESSES section 
above) and on EPA's website at https://www.epa.gov/vehicle-and-engine-certification/compliance-information-light-duty-greenhouse-gas-ghg-standards.
    EPA is providing a 30-day comment period on the applications for 
off-cycle credits described in this notice, as specified by the 
regulations. The manufacturers may submit a written rebuttal of 
comments for EPA's consideration, or may revise an application in 
response to comments. After reviewing any public comments and any 
rebuttal of comments submitted by manufacturers, EPA will make a final 
decision regarding the credit requests. EPA will make its decision 
available to the public by placing a decision document (or multiple 
decision documents) in the docket and on EPA's website at the same 
manufacturer-specific pages shown above. While the broad methodologies 
used by these manufacturers could potentially be used for other 
vehicles and by other manufacturers, the vehicle specific data needed 
to demonstrate the off-cycle emissions reductions would likely be 
different. In such cases, a new application would be required, 
including an opportunity for public comment.

    Dated: January 27, 2020.
Byron J. Bunker,
Director, Compliance Division, Office of Transportation and Air 
Quality, Office of Air and Radiation.
[FR Doc. 2020-02370 Filed 2-5-20; 8:45 am]

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