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Exemptions From Average Fuel Economy Standards; Passenger Automobile Average Fuel Economy Standards Publication: Federal Register Agency: National Highway Traffic Safety Administration Byline: Sophie Shulman Date: 20 February 2024 Subject: American Government  , The Environment
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[Federal Register Volume 89, Number 34 (Tuesday, February 20, 2024)]
[Rules and Regulations]
[Pages 12749-12756]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-03119]
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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
49 CFR Part 531
[NHTSA-2022-0048]
RIN 2127-AM29
Exemptions From Average Fuel Economy Standards; Passenger
Automobile Average Fuel Economy Standards
AGENCY: National Highway Traffic Safety Administration (NHTSA),
Department of Transportation (DOT).
ACTION: Final rule; final decision to grant exemption.
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SUMMARY: This final decision responds to petitions filed by several low
volume manufacturers requesting exemption from the generally applicable
corporate average fuel economy (CAFE) standards for several model years
(MYs). The low volume manufacturers and MYs are as follows: Aston
Martin Lagonda Limited for MYs 2008-2023, Ferrari N.V. for MYs 2016-
2018 and 2020, Koenigsegg Automotive AB for MYs 2015 and 2018-2023,
McLaren Automotive for MYs 2012-2023, Mobility Ventures LLC for MYs
2014-2016, Pagani Automobili S.p.A for MYs 2014 and 2016-2023, and
Spyker Automobielen B.V. for MYs 2008-2010. NHTSA is exempting these
manufacturers from the generally applicable CAFE standards for the
model years listed and establishing alternative standards for each
manufacturer at the levels stated below, which the agency has
determined to be maximum feasible for each of those manufacturers for
the model years in question.
DATES: This rule is effective March 21, 2024.
ADDRESSES: For access to the dockets to read background documents or
comments received, go to https://www.regulations.gov, and/or: Docket
Management Facility, M-30, U.S. Department of Transportation, West
Building, Ground Floor, Rm. W12-140, 1200 New Jersey Avenue SE,
Washington, DC 20590. The Docket Management Facility is open between 9
a.m. and 4 p.m. Eastern Time, Monday through Friday, except on Federal
holidays.
FOR FURTHER INFORMATION CONTACT: Joseph Bayer, Chief of Fuel Economy
Division, Office of Rulemaking, by phone at (202) 366-9540 or by fax at
(202) 493-2290 or Hannah Fish, Attorney Advisor, Vehicle Standards and
Harmonization, Office of the Chief Counsel, by phone at (202) 366-2992
or by fax at (202) 366-3820.
SUPPLEMENTARY INFORMATION:
Table of Contents
1. Introduction
2. Summary of Proposed Rule
3. Summary and Response to Comments Received on the Proposal
4. Maximum Feasible Average Fuel Economy for Exempted Manufacturers
5. Regulatory Impact Analyses
a. Regulatory Evaluation
b. Regulatory Flexibility Determination
c. National Environmental Policy Act
Regulatory Text
1. Introduction
The Energy Policy and Conservation Act (EPCA) of 1975, as amended
by the Energy Independence and Security Act (EISA) of 2007,\1\ directs
the Secretary of Transportation, and the National Highway Traffic
Safety Administration (NHTSA) by delegation,\2\ to prescribe corporate
average fuel economy (CAFE) standards for automobiles manufactured in
each model year (MY). EPCA/EISA requires NHTSA to establish CAFE
standards for passenger cars and light trucks at the ``maximum feasible
average fuel economy level'' that it decides manufacturers can achieve
in a MY,\3\ based on the agency's consideration of four factors:
technological feasibility, economic practicability, the effect of other
standards of the Government on fuel economy, and the need of the United
States to conserve energy.\4\
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\1\ 49 U.S.C. 32901 et seq.
\2\ 49 CFR 1.95.
\3\ 49 U.S.C. 32902(a).
\4\ 49 U.S.C. 32902(f).
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Congress provided in EPCA/EISA statutory authority for NHTSA to
exempt a low volume manufacturer of passenger automobiles from the
industry-wide passenger car standard if NHTSA concludes that the
industry-wide passenger car standard is more stringent than the maximum
feasible average fuel economy level that the manufacturer can achieve,
and NHTSA establishes an alternative standard for that manufacturer's
fleet of passenger cars at the maximum feasible average fuel economy
level that the manufacturer can achieve.\5\ Under EPCA/EISA, a low
volume manufacturer is one that manufactured (whether in the United
States or not) fewer than 10,000 passenger automobiles in the MY two
years before the MY for which the exemption is sought, and that will
manufacture fewer than 10,000
[[Page 12750]]
passenger automobiles in the affected MY. NHTSA may set alternative
fuel economy standards in three ways: (1) a separate standard for each
exempted manufacturer; (2) a separate standard applicable to each class
of exempted automobiles (classes based on design, size, price, or other
factors); or (3) a single standard for all exempted manufacturers.\6\
NHTSA has historically set individual standards for each exempted
manufacturer.
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\5\ 49 U.S.C. 32902(d). NHTSA notes that there is no statutory
provision allowing exemptions from the light truck standards
established in 49 CFR part 533.
\6\ 49 U.S.C. 32902(d)(2).
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49 CFR part 525 contains NHTSA's regulations implementing the
requirements in 49 U.S.C. 32902. This part provides content and format
requirements for low volume manufacturer petitions for exemption and
specifies that those petitions must be submitted to NHTSA not later
than 24 months before the beginning of the affected model year unless
good cause for later submission is shown.\7\ As discussed further
below, manufacturers must include several data elements in their
petitions, including among other things projected vehicle production
mix, vehicle features for each vehicle configuration, projected average
fuel economy figures for each production mix, and technological means
for improving the fuel economy of the manufacturer's vehicles.\8\ Part
525 also outlines the NHTSA process for publishing proposed and final
decisions on petitions in the Federal Register and for accepting public
input on proposed decisions.\9\ A manufacturer's final alternative
standard is codified at 49 CFR part 531.
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\7\ 49 CFR 525.6(b). See also 54 FR 40689 (Oct. 3, 1989). NHTSA
has identified two broad categories of situations that would
establish good cause for failure to submit a timely petition:
situations in which necessary supporting data for the petition were
unavailable until after the due date had passed (for example, a
recently incorporated manufacturer might not have adequate time to
file an exemption petition 24 months prior to the model year), and
second, situations in which a legitimately unexpected noncompliance
occurs (for example, if a company providing a low volume
manufacturer with its engines goes out of business, and the
manufacturer is forced to make an unanticipated engine switch,
resulting in lower than expected fuel economy). That said, each
determination that good cause was or was not shown for the late
filing is made on an individual basis. Manufacturers should reach
out to NHTSA as expeditiously as possible if they expect they cannot
submit a petition in a timely manner.
\8\ 49 CFR 525.7.
\9\ 49 CFR 525.8.
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This final decision responds to petitions filed by Aston Martin
Lagonda Limited (AML) for MYs 2008-2023, Ferrari N.V. (Ferrari) for MYs
2016-2018 and 2020, Koenigsegg Automotive AB (Koenigsegg) for MYs 2015
and 2018-2023, McLaren Automotive (McLaren) for MYs 2012-2023, Mobility
Ventures LLC (Mobility Ventures) for MYs 2014-2016, Pagani Automobili
S.p.A (Pagani) for MYs 2014 and 2016-2023,\10\ and Spyker Automobielen
B.V. (Spyker) for MYs 2008-2010. NHTSA concludes that all seven
manufacturers were, and are, eligible for an alternative standard for
the listed model years and that the industry-wide passenger car CAFE
standard for those model years is more stringent than the maximum
feasible average fuel economy level that those manufacturers could, and
can, achieve. Alternative standards for each manufacturer will be set
at the levels discussed below.
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\10\ Pagani petitioned for alternative standards for MYs 2012-
2021 but did not produce any vehicles for sale in the U.S. market in
MYs 2012, 2013, and 2015.
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2. Summary of the Proposed Decision
NHTSA published a proposed decision on July 1, 2022 (87 FR 39439)
that proposed to exempt several low volume manufacturers from the
generally applicable CAFE standards for several model years. Some of
these model years had already passed, meaning that any NHTSA action
prescribing alternative standards for past model years would be
retroactive. NHTSA recognized that an agency's ability to prescribe
retroactive rules is very limited; however, NHTSA concluded that based
on a history of previously granting low volume exemption petitions when
the agency did not publish proposed and final determinations on those
exemption petitions before the beginning of a model year,\11\ and the
limited circumstances in this case, retroactively publishing
alternative low volume CAFE standards was appropriate.
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\11\ See, e.g., 43 FR 33268 (July 31, 1978); 49 FR 11548 (March
1, 1979); 46 FR 29944 (June 4, 1981); 54 FR 40689 (October 3, 1989);
55 FR 12485 (April 4, 1990).
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NHTSA also detailed the agency's approach to evaluating exemption
petitions for model years that had already passed. NHTSA concluded that
in addition to evaluating the manufacturer's exemption petitions for
past model years, it was appropriate to evaluate the manufacturer's
actual CAFE values if NHTSA had those values (either from EPA-verified
data or from preliminary data submitted by the manufacturer). For
imminently future model years, NHTSA evaluated whether the alternative
standard for which the manufacturer petitioned was maximum feasible,
and if not, what, if any, technologically feasible and economically
practicable changes the manufacturer could make in the time frame
before model year production would need to commence. NHTSA looked to
the regulations implementing EPCA's low volume manufacturer exemption
provisions, which required low volume manufacturers to submit petitions
for exemption ``not later than 24 months before the beginning of the
affected model year,'' as a guidepost for determining whether a low
volume manufacturer could potentially make any additional changes to
its vehicles.
All low volume manufacturers considered in the proposed decision
met the threshold statutory requirements for eligibility; that is, all
manufacturers manufactured or will manufacture fewer than 10,000
vehicles in the applicable model years. Some petitions for some model
years were submitted late, although the late filings were accompanied
by good cause claims, per 49 CFR part 525.\12\ Regardless of the
sufficiency of those good cause claims, NHTSA stated that due to the
significant lateness of the agency's response to these specific
exemption requests, it would be inequitable at this point to deny the
late petitions on grounds of untimeliness. Moving forward, NHTSA
expects manufacturers to remain cognizant of the requirement that each
submission must be submitted not later than 24 months before the
beginning of the affected model year unless good cause for later
submission is shown.
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\12\ 49 CFR 525.6 (``Each petition filed under this part must .
. . Be submitted not later than 24 months before the beginning of
the affected model year, unless good cause for later submission is
shown.'').
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When proposing maximum feasible average fuel economy levels, NHTSA
must consider four factors: technological feasibility, economic
practicability, the effect of other motor vehicle standards of the
Government on fuel economy, and the need of the United States to
conserve energy. NHTSA detailed in the proposed rule how the agency's
consideration of these factors with low volume manufacturers differs
from consideration of these factors for full-line manufacturers, and
also how consideration of these factors as applied to past model years
differs from consideration for future model years.
Per NHTSA's regulations at 49 CFR 525.7, NHTSA evaluated several
pieces of information in each manufacturer's petition to assist the
agency in assessing technologically feasible and economically
practicable improvements for the manufacturer's fleet. This information
included a description of the technological means selected by the
manufacturer for improving the average fuel economy of its automobiles
to be
[[Page 12751]]
manufactured in a model year, a chronological description of the
manufacturer's past and planned efforts to implement the fuel-economy-
improving technology in its fleet, a discussion of the alternative and
additional means considered but not selected by the manufacturer that
would have enabled its passenger automobiles to achieve a higher
average fuel economy than is achievable with the means it described,
and in the case of a manufacturer that planned to increase the average
fuel economy of its passenger automobiles to be manufactured in either
of the two model years immediately following the first affected model
year, an explanation of the reasons for not making those increases in
the affected model year.
To evaluate the potential effect of alternative CAFE standards on
the need of the United States to conserve energy, NHTSA described two
historical approaches. For several years, the agency categorically
concluded that if it had already determined that it would not be
technologically feasible or economically practicable for the low volume
manufacturer to achieve a higher fuel economy standard than requested,
denying the exemption or setting a higher alternative standard would
not have had any effect on the need of the United States to conserve
energy.\13\ In later years the agency attempted to quantify that de
minimis impact for illustrative purposes, by estimating the amount of
additional fuel consumed by the exempted fleet over its operating
lifetime.\14\ The July 2022 proposed decision quantified the estimated
additional fuel consumed by the exempted fleet in accordance with the
second approach, using a combination of estimated and achieved fleet
fuel economy values, and an updated data-based estimate of yearly low
volume vehicle miles travelled (VMT) for some categories of low volume
vehicles.\15\ NHTSA sought comment on that approach and requested any
other data or information on the driving patterns and mileage schedules
of another category of low volume vehicles--vehicles used to transport
wheelchair-bound or otherwise mobility-impaired individuals. NHTSA
estimated that the additional fuel consumed by the entire low volume
fleet considered in the proposed decision at the proposed alternative
standards level equaled 39,769,449 additional gallons of gasoline or
0.001877% of total U.S. motor vehicle fuel consumption over the
vehicles' lifetimes.
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\13\ See, e.g., 54 FR 40689 (Oct. 3, 1989).
\14\ See, e.g., 61 FR 46756 (Sep. 5, 1996), 71 FR 49407 (Aug.
23, 2006). In brief, the estimated amount of additional fuel
consumed by the exempted fleet over its operating lifetime is a
function of the difference between the manufacturer's actual CAFE
standard and their requested alternative standard multiplied by the
manufacturer's estimated U.S. production volume, multiplied then by
an estimate of the total miles these vehicles could travel as an
active part of the fleet. The resulting difference is then divided
by the average number of gallons that the total U.S. automotive
fleet uses. The final value shows the fleet's additional gallons of
fuel use as a percentage of total U.S. automotive fuel use.
\15\ Historically, low volume manufacturer petitions for
exemption from CAFE standards have covered luxury vehicles, exotic
high-performance vehicles, and vehicles exclusively designed to be
used for transporting the wheelchair-bound or other mobility-
impaired individuals.
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To evaluate the effect of ``other motor vehicle standards of the
Government'' on fuel economy, NHTSA examined the agency's safety
standards as well as EPA's emissions standards, which include criteria
pollutant and greenhouse gas (GHG, which include CO2,
N2O, CH4, and hydrofluorocarbons) emissions
standards.
NHTSA recognized that three manufacturers considered in the July
2022 proposal (Aston Martin, Ferrari, and McLaren) had received an
alternative low volume GHG standard under the EPA small volume program
for vehicles manufactured in MYs 2017-2021.\16\ NHTSA explained that
the agencies' (NHTSA's and EPA's) respective statutory authorities and
regulations required a slightly different approach to examining these
manufacturers' petitions for alternative standards and provided a
comparison of differences between EPA's final small volume standards
and NHTSA's proposed alternative standards. NHTSA sought comment on any
new information the agency should consider on the impact of EPA's GHG
standards on a manufacturer's ability to meet an alternative fuel
economy standard.
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\16\ 85 FR 39561 (July 1, 2020).
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Several manufacturers cited various Federal Motor Vehicle Safety
Standards (FMVSS) that could impact their CAFE values, including FMVSS
No. 214, Side Impact Protection, FMVSS No. 216, Roof Crush Resistance,
FMVSS No. 226, Occupant Ejection Mitigation, FMVSS No. 301, Fuel System
Integrity, FMVSS No. 111, Rear Visibility (concerning rearview
mirrors), and the Pedestrian Protection requirements as proposed in the
UN ECE Global Technical Regulation (GTR) No. 9. Broadly, manufacturers
stated that these safety standards could have potentially adverse
impacts on vehicles' achieved fuel economy levels because of additional
vehicle weight required, and because they reduce potential aerodynamic
improvements. Manufacturers also cited EPA and California non-GHG
emissions standards as requirements that would demand additional
balancing of priorities.
Using an analysis of estimates from prior CAFE standards rules,\17\
NHTSA concluded that the small increase in weight from the FMVSSs
(approximately 32 pounds, which was likely already incorporated in the
vehicle) would have negligible effects on any vehicle considered in the
proposed decision. NHTSA also concluded that a manufacturer's
compliance with EPA's criteria pollutant emissions standards would have
a negligible effect on the manufacturer's maximum feasible fuel economy
level, based on EPA's specific consideration of its criteria pollutant
emissions programs on small volume manufacturers.\18\
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\17\ Final Regulatory Impact Analysis, Corporate Average Fuel
Economy for MY 2017-MY 2025 Passenger Cars and Light Trucks, Table
IV-3a (August 2012).
\18\ 79 FR 23534 (April 28, 2014).
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Accordingly, NHTSA had proposed alternative standards as follows:
For MYs 2018 and prior, NHTSA proposed to use a combination of final
fuel economy values received from EPA and some non-final fuel economy
values received from manufacturers. NHTSA stated its belief that all
manufacturers covered by the proposed decision submitted information
sufficient for the agency to conclude that their achieved fuel economy
levels for past model years were the maximum feasible fuel economy
levels that they could have achieved for those model years.
For MYs 2019-2023, the proposed alternative standards considered
both confidential business information (CBI) and non-CBI information
submitted to the agency, including the manufacturer's requested
alternative standard and predicted achieved fleet fuel economy value
(if that value differed from the requested alternative standard). For
imminently future model years (i.e., MYs 2022 and 2023), NHTSA proposed
standards that did not backslide (i.e., that did not decrease from MY
2022 to 2023).
NHTSA tentatively concluded that the proposed fuel economy levels
appropriately balanced the CAFE exemption program with EPCA's directive
to conserve energy and that standards that did not backslide for
imminently future model years were maximum feasible.
NHTSA sought comment on the analysis that led the agency to propose
[[Page 12752]]
those alternative standards. In addition, NHTSA stated that the agency
would consider any additional information submitted by commenters,
manufacturers (if additional information became available), or EPA (if
additional final fuel economy data became available) submitted during
the pendency of the comment period associated with the proposal.
3. Summary and Response to Comments Received on the Proposal
NHTSA received four comments to the proposal. One individual
commenter opposed the proposed exemption, believing that the exemption
should not apply to expensive vehicles.\19\ Another individual
commenter broadly opposed the CAFE program based on, among other
things, general opposition to climate science.\20\
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\19\ NHTSA-2022-0048-0005.
\20\ NHTSA-2022-0048-0007.
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The Alliance for Automotive Innovation (Auto Innovators) agreed
with NHTSA's proposed approach to alternative standards through MY
2023. Auto Innovators stated that manufacturers affected by the
proposal for past model year standards ``have no ability to change the
technologies installed on their vehicles, to alter U.S.-directed
production, or to otherwise achieve compliance with the CAFE regulation
other than through the purchase of credits from other manufacturers or
the payment of civil penalties.'' \21\ Auto Innovators also stated that
MY 2022 production will likely soon be ending, and there is little or
no opportunity to change designs for MY 2023 production.\22\ Auto
Innovators urged NHTSA to propose future alternative standards at least
18 months before the affected model year, as ``low-volume manufacturers
require similar or even more lead-time as larger manufacturers to
adjust product designs and production plans'' if NHTSA were to finalize
alternative standards other than those the manufacturer requested in
its petition.\23\
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\21\ NHTSA-2022-0048-0006, Attachment 1, at 1.
\22\ Id.
\23\ NHTSA-2022-0048-0006, Attachment 1, at 2.
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Ferrari also supported the proposed alternative standards for
affected model years and urged NHTSA to adopt the final standards as
quickly as possible.\24\ Ferrari reiterated the company's use of fuel
economy-improving technologies, and stated that its fuel economy levels
are highly dependent on the mix of models that its purchasers choose
because of the limited number of models and powertrains.\25\ Ferrari
also noted EPA's final determination for alternative GHG standards for
low volume manufacturers, which set standards for Ferrari for MYs 2017
through 2021.\26\
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\24\ NHTSA-2022-0048-0004, Attachment 1, at 3.
\25\ Id.
\26\ Id.
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NHTSA considered these four comments. As discussed above, Congress
provided in EPCA/EISA statutory authority for NHTSA to exempt a low
volume manufacturer of passenger automobiles from the industry-wide
passenger car standard if NHTSA concludes that the industry-wide
passenger car standard is more stringent than the maximum feasible
average fuel economy level that the manufacturer can achieve, and NHTSA
establishes an alternative standard for that manufacturer's fleet of
passenger cars at the maximum feasible average fuel economy level that
the manufacturer can achieve. In addition, as stated in the NPRM, NHTSA
does not consider the ability of a manufacturer to (through an increase
in the price of the vehicle or otherwise) absorb civil penalty payments
from having to meet a higher standard.\27\ NHTSA disagrees with the
individual commenter's assessment of the state of climate science, and
that comment is discussed further in the Final Environmental
Assessment, below. Finally, NHTSA considered Auto Innovators' and
Ferrari's comments and is finalizing these alternative standards as
expeditiously as possible.
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\27\ 87 FR 39443 (July 1, 2022) (citing 44 FR 3710 (Jan. 18,
1979)).
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4. Maximum Feasible Average Fuel Economy for Exempted Manufacturers
Considering the information presented in the proposed decision and
comments received, NHTSA is setting alternative average fuel economy
standards for these seven manufacturers for each model year at the
levels identified in the proposed decision. NHTSA used several sources
of data to determine these CAFE levels, including final and non-final
fuel economy data, and CBI and non-CBI submitted by manufacturers. In
addition, the standards do not backslide for imminently future model
years. NHTSA believes that these alternative standards are maximum
feasible for these manufacturers for these model years, that they are
consistent with the purpose of EPCA/EISA, and that they appropriately
balance the CAFE exemption program with EPCA's directive to conserve
energy.
Table 4--Alternative Standards for MYs 2008-2023
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Mobility
Aston Martin Ferrari Koenigsegg McLaren Ventures Pagani Spyker
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2008.................................... 19.0 .............. .............. .............. .............. .............. 19.6
2009.................................... 18.6 .............. .............. .............. .............. .............. 19.6
2010.................................... 19.2 .............. .............. .............. .............. .............. 20.7
2011.................................... 19.1 .............. .............. .............. .............. .............. ..............
2012.................................... 19.2 .............. .............. 23.2 .............. .............. ..............
2013.................................... 20.1 .............. .............. 24.0 .............. .............. ..............
2014.................................... 19.7 .............. .............. 23.8 19.6 15.6 ..............
2015.................................... 19.8 .............. 16.7 22.9 20.1 .............. ..............
2016.................................... 20.2 21.7 .............. 23.2 20.1 15.6 ..............
2017.................................... 21.4 21.5 .............. 24.3 .............. 15.6 ..............
2018.................................... 22.9 21.6 16.7 23.3 .............. 15.6 ..............
2019.................................... 22.4 .............. 16.6 22.5 .............. 15.5 ..............
2020.................................... 22.6 21.1 16.6 22.5 .............. 15.5 ..............
2021.................................... 24.9 .............. 16.6 21.5 .............. 15.5 ..............
2022.................................... 24.9 .............. 16.9 24.6 .............. 15.5 ..............
2023.................................... 24.9 .............. 16.9 25.7 .............. 15.5 ..............
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[[Page 12753]]
These alternative standards apply only to Aston Martin Lagonda
Limited for MYs 2008-2023, Ferrari N.V. for MYs 2016-2018 and MY 2020,
Koenigsegg Automotive AB for MYs 2015 and 2018-2023, McLaren Automotive
for MYs 2012-2023, Mobility Ventures LLC for MYs 2014-2016, Pagani
Automobili S.p.A for MYs 2014 and 2016-2023, and Spyker Automobielen
B.V. for MYs 2008-2010. They do not apply to low volume manufacturers
generally or to a class of automobiles of exempted manufacturers.
Readers should remember that NHTSA does not set alternative standards
for a given model year unless a manufacturer has requested them, and
thus certain cells in the table above are blank.
NHTSA is also finalizing the correction to the reference to
alternative fuel economy standards in 49 CFR 531.5(a), as paragraph (f)
does not exist.
5. Regulatory Impact Analyses
a. Regulatory Evaluation
NHTSA has considered the potential impacts of this action under
Executive Order (E.O.) 12866 and the Department of Transportation's
regulatory policies and procedures and has concluded that those orders
do not apply because this action is not an agency statement of general
applicability and future effect. This decision is not generally
applicable, because the agency has proposed to set alternative average
fuel economy standards for each manufacturer.
b. Regulatory Flexibility Determination
Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601 et seq.,
as amended by the Small Business Regulatory Enforcement Fairness Act
(SBREFA) of 1996), whenever an agency is required to publish a notice
of proposed rulemaking, it must prepare and make available for public
comment a regulatory flexibility analysis that describes the effect of
the rule on small entities (i.e., small businesses, small
organizations, and small governmental jurisdictions) unless the head of
an agency certifies the proposal will not have a significant economic
impact on a substantial number of small entities. The Small Business
Administration's regulations at 13 CFR part 121 define a small
business, in part, as a business entity ``which operates primarily
within the United States.'' (13 CFR part 121.105(a)). SBREFA amended
the Regulatory Flexibility Act to require Federal agencies to provide a
statement of the factual basis for certifying that a proposal will not
have a significant economic impact on a substantial number of small
entities.
I certify this final decision will not have a significant impact on
a substantial number of small entities. This final decision exempts low
volume manufacturers from the generally applicable passenger car CAFE
standards and sets alternative standards for those low volume
manufacturers at maximum feasible levels.
c. National Environmental Policy Act
The National Environmental Policy Act of 1969 (NEPA) (42 U.S.C.
4321-4347) requires Federal agencies to consider the environmental
impacts of proposed major Federal actions significantly affecting the
quality of the human environment, as well as the impacts of
alternatives to the proposed action.\28\ The Council on Environmental
Quality (CEQ) NEPA implementing regulations (40 CFR parts 1500-1508)
direct Federal agencies to prepare an environmental assessment for a
proposed action that is not likely to have significant effects or when
the significance of the effects is unknown.\29\ The environmental
assessment must ``briefly discuss the purpose and need for the proposed
action, alternatives[ ], and the environmental impacts of the proposed
action and alternatives, and include a listing of agencies and persons
consulted.'' \30\ This section serves as the National Highway Traffic
Safety Administration's (NHTSA) Final Environmental Assessment (Final
EA).
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\28\ 42 U.S.C. 4332(2)(C).
\29\ 40 CFR 1501.5(a).
\30\ 40 CFR 1501.5(c)(2).
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1. Purpose and Need for Action
In accordance with the Energy Policy and Conservation Act (EPCA) of
1975, as amended by the Energy Independence and Security Act (EISA) of
2007, and the procedures at 49 CFR part 525, the purpose of this action
is to set alternative corporate average fuel economy (CAFE) standards
for low volume manufacturers that have petitioned the agency for an
alternative standard at the maximum feasible fuel economy level that
NHTSA believes each manufacturer can achieve in each model year. While
the purpose of setting industry-wide fuel economy standards under EPCA/
EISA is, among other things, energy conservation, Congress granted
NHTSA the ability to provide an exemption to low volume manufacturers
in part because it believed that the need of the United States to
conserve energy would not be adversely affected by allowing the limited
exemption.\31\ If NHTSA did not grant alternative standards for low
volume manufacturers, they would have to meet the industry-wide
passenger car standard in each applicable model year, which, in most if
not all cases, is more stringent than the maximum feasible fuel economy
level that NHTSA believes these low volume manufacturers can achieve.
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\31\ See, e.g., 44 FR at 3711 (Jan. 18, 1979).
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When determining the maximum feasible fuel economy levels that
manufacturers can achieve in each model year, EPCA/EISA requires that
NHTSA consider four factors: technological feasibility, economic
practicability, the effect of other motor vehicle standards of the
government on fuel economy, and the need of the United States to
conserve energy. NHTSA relies on information in each low volume
manufacturer's petition for exemption to propose alternative average
fuel economy standards at the maximum feasible level for each
manufacturer. However, the unique nature of this action requires NHTSA
to set maximum feasible standards for model years that have already
passed. NHTSA's proposed action and range of alternatives considered
below reflect these statutory and practical considerations.
2. Proposed Action and Alternatives
The Draft EA considered a ``no-action alternative'' and two
alternatives. The ``no-action alternative'' assumed that in the absence
of NHTSA action on their petitions, manufacturers would meet their
footprint-based CAFE standard for MYs 2013-2023.\32\ One alternative
proposed to set alternative standards at the levels that the
manufacturers requested for model years for which NHTSA does not have
final fuel economy data (the ``as-requested'' alternative); and the
preferred alternative proposed to set standards at the levels detailed
in the preamble above. NHTSA did not consider an alternative that
proposed to set an alternative standard for a model year at a lower
level than the manufacturer achieved in past model years (i.e., in some
cases for past model years what
[[Page 12754]]
the manufacturer requested) because that would not have been the
maximum feasible fuel economy level that the manufacturer could
achieved.
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\32\ As discussed in the proposal and Draft EA (87 FR 39439,
July 1, 2022), NHTSA has expired MY 2012 and earlier fuel economy
credits in accordance with 49 CFR 536.5(c)(2), meaning that low
volume manufacturers that built vehicles in MYs 2008-2012 cannot now
buy fuel economy credits from manufacturers that exceeded their CAFE
standard in those years to offset the CAFE values of the low volume
vehicles produced in those years. As a simplifying assumption,
because there can be no difference between the fuel used in MYs
2008-2012 under the no-action alternative baseline and action
scenarios, fuel use in those years was not considered.
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3. Affected Environment
The Draft EA described that NHTSA actions regulating motor vehicle
fuel economy could have a range of environmental impacts, including on
energy use, air quality, climate change, resource extraction and use,
and on environmental justice communities, among others. Every time
NHTSA sets industry-wide CAFE standards, the agency examines the
environmental impact of the proposed standards and a range of
alternatives on these resources in an environmental impact statement
(EIS). The EIS uses estimates of fuel consumption that would result if
the agency adopted different levels of fuel economy standards to
quantitatively estimate the impacts on energy use, air quality, and
greenhouse gas emissions and climate change. NHTSA also qualitatively
discusses the lesser impacts on other resource areas, including land
use and development, hazardous materials and regulated waste,
historical and cultural resources, noise, and environmental justice.
NHTSA's Final Supplemental Environmental Impact Statement (Final
SEIS) for MY 2024-2026 passenger car and light truck fuel economy
standards (hereinafter ``Final SEIS'') provided the most up-to-date
estimates of the impact of different levels of fuel economy standards
on these resource areas and discussion of the environmental impacts, at
the time that NHTSA was completing the Draft EA associated with this
decision.\33\ The Final SEIS discussions of environmental impacts
resulting from changes in fuel use from motor vehicles were
incorporated by reference in the Draft EA,\34\ and the Draft EA
contains a summary of those discussions.\35\
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\33\ NHTSA has released a Draft Environmental Impact Statement
for Corporate Average Fuel Economy Standards for Passenger Cars and
Light Trucks, Model Years 2027-2032, and Fuel Efficiency Standards
for Heavy-Duty Pickup Trucks and Vans, Model Years 2030-2035,
available at https://www.regulations.gov/docket/NHTSA-2022-0075.
This Draft EIS has additional analysis of the affected environment
and environmental consequences associated with different levels of
fuel economy and fuel efficiency standards; however, there is an
ongoing comment period for that Draft EIS and NHTSA is still
receiving comments on the approach and analysis used in that Draft
EIS, which may yet be updated in the Final EIS. Accordingly, NHTSA
continues to reference the Final SEIS mentioned above in this Final
EA/FONSI.
\34\ 40 CFR 1501.12.
\35\ 87 FR 39455 (July 1, 2022).
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4. Environmental Consequences
The Draft EA estimated the levels of changes in fuel consumption
under the ``no-action alternative'' and two alternatives to provide a
starting point to estimate a relative potential range of environmental
impacts. To estimate the amount of additional fuel consumed by the
exempted fleet over its operating lifetime,\36\ NHTSA calculated the
difference between the low volume manufacturer's footprint-based
standard for MY 2013 forward (i.e., the estimated fuel used under the
no-action alternative, for model years for which fuel economy credits
are available) and its proposed alternative standard (or achieved fleet
fuel economy for model years that have already passed). NHTSA
multiplied this difference by the manufacturer's estimated U.S.
production volume,\37\ and then by estimated total miles that these
vehicles could travel as an active part of the fleet (i.e., the
vehicles' estimated yearly VMT).\38\ The resulting estimates of
additional lifetime fuel consumption for all manufacturers and model
years considered in this action compared to the no-action alternative
are shown below.
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\36\ Approximately 15 years, based on the estimated passenger
sedan life as calculated in the latest industry-wide CAFE rulemaking
action.
\37\ As discussed in the proposal, where NHTSA did not have
final production data for a manufacturer, in particular where
estimated production data is still confidential, the agency averaged
the last three years of a manufacturers' actual production data.
\38\ As discussed in the proposal, NHTSA estimated that a high-
performance vehicle would travel 2,543 miles per year, while a
mobility van would travel 11,128 miles per year.
Table 6--Estimated Additional Lifetime Fuel Consumption
----------------------------------------------------------------------------------------------------------------
Preferred
No action alternative As requested
----------------------------------------------------------------------------------------------------------------
Total Gallons.......................................... 48,873,908 88,643,357 88,997,267
Difference from the No-Action Alternative.............. ................. 39,769,449 40,123,359
----------------------------------------------------------------------------------------------------------------
To put this in perspective, NHTSA looked at the average amount of
fuel consumed by an average passenger car subject to the industry-wide
passenger car CAFE standard over its useful life, in this case a MY
2017 Toyota Camry. The estimated total gallons of fuel used if
standards are set at the levels proposed in this action are roughly
equivalent to the fuel used by approximately 8,534 MY 2017 Toyota
Camrys. In other words, setting alternative standards at the levels
proposed in this notice for the 15 model years covered by this notice
would have the energy effect of a one-time addition of 171 MY 2017
Toyota Camrys per U.S. state. Compared to the pre-pandemic peak of
approximately 17 million vehicles sold in the United States in a model
year, the vehicles considered in this notice that cover fifteen model
years contribute only a small amount to total U.S. transportation fuel
use.
As with the impacts to energy use, NHTSA tentatively concluded that
the proposed action would have a relatively minimal impact on air
quality, and accordingly, air quality-related health effects, based on
the relative percentage of fuel used by the vehicles considered in this
action compared to total light-duty vehicle fuel use. As discussed in
Chapter 4 of NHTSA's Final SEIS, nationwide criteria pollutant
emissions from vehicle tailpipes are projected to decrease over time,
even as VMT increases, due to increasingly stringent EPA regulation of
criteria pollutant emissions and reductions in emissions from fuel
production. NHTSA does not expect that trend to change based on the
levels of fuel use projected for this action. In addition, some of the
increases in criteria pollutant emissions projected in the Final SEIS
are due to increases in upstream emissions from power plants from
increased electric vehicle use. The vehicles considered in this action
run primarily on gasoline; none of the vehicles with electrified
powertrains draw energy from the electric grid. The same projected
trends exist for toxic air pollutants; emissions are projected to
decrease through 2050 based on increasingly stringent EPA regulations
and reductions in emissions from fuel production, despite growth in
total VMT. NHTSA does not expect that any of these trends would change
based
[[Page 12755]]
on the minor increases in fuel use projected from this decision.
To estimate the approximate effect that this action would have on
greenhouse gas emissions, NHTSA first used EPA's Greenhouse Gas
Equivalencies Calculator to convert the estimated additional gallons of
gasoline that would be used under the alternatives to metric tons of
carbon dioxide equivalent emissions.\39\ Over the lifetime of all model
year vehicles considered in this notice (15 model years' worth of
vehicles that each last approximately 15 years), for the fuel use
considered in this action, the following additional carbon dioxide
equivalent emissions are expected to result: 285,193 metric tons of
carbon dioxide equivalent emissions under the ``as-requested''
alternative, and 282,047 metric tons of carbon dioxide equivalent
emissions at the preferred alternative levels. To put this in
perspective, NHTSA referenced EPA's Inventory of U.S. Greenhouse Gas
Emissions and Sinks 1990-2019 report, which estimated that the U.S.
passenger car and light truck vehicle fleet emits a little over a
thousand million metric tons of carbon dioxide equivalent emissions per
year (averaged over 2017, 2018, and 2019).\40\ Over the useful life of
a vehicle considered in this action, the vehicles considered in this
action are estimated to produce an estimated increase in carbon dioxide
equivalent emissions of 0.00169% and 0.00167% (for the as-requested and
preferred alternative levels, respectively) of total light-duty vehicle
carbon dioxide equivalent emissions over what the vehicles would have
produced had they met their footprint-based standard.
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\39\ U.S. EPA Greenhouse Gas Equivalencies Calculator, https://www.epa.gov/energy/greenhouse-gas-equivalencies-calculator. EPA
specifies that estimates from this calculator are approximate and
should not be used for emission inventories or formal carbon
emissions analysis. NHTSA used these estimates as part of its
determination that a formal carbon emissions analysis is not
required for this action.
\40\ U.S. EPA, Inventory of U.S. Greenhouse Gas Emissions and
Sinks: 1990-2019, at Table 2-13, available at https://www.epa.gov/sites/default/files/2021-04/documents/us-ghg-inventory-2021-main-text.pdf?VersionId=wEy8wQuGrWS8Ef_hSLXHy1kYwKs4.ZaU.
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NHTSA did not perform independent climate modeling because the
agency believes that it is reasonable to infer that if relatively
small--but not trivial--climate impacts would result from large-scale
changes in fuel use from changes in the industry-wide passenger car and
light truck standards, as demonstrated in the Final SEIS and referenced
in the Draft EA, estimating the impacts of the no-action alternative
and alternatives presented in this notice would not present any
additional meaningful information for decisionmakers and the public.
Some potential impacts of the proposed action could be mitigated
through other means; as discussed above, EPA also sets alternative
carbon dioxide emissions standards for some of the low volume
manufacturers considered in this notice. Unlike the structure of EPCA/
EISA, which allows civil penalty payment for each 0.1 of a mile a
gallon by which the manufacturer falls short of the applicable average
fuel economy standard,\41\ manufacturers must comply with EPA
regulations promulgated under the Clean Air Act to sell their vehicles.
To the extent that EPA sets higher alternative standards for model
years 2022 and 2023 vehicles, some of the estimated impacts could
potentially be mitigated. Next, the estimates of fuel use presented
here are dependent on several assumptions, one being how many miles
these vehicles are driven. The vehicles covered by this final decision
represent an extremely small fraction of overall motor vehicle sales
and on-road VMT; most of the vehicles considered in this notice are
estimated to drive only a quarter of the mileage of the average
passenger car. If these vehicles were or are driven less than NHTSA
estimated, fuel use, air quality impacts, and greenhouse gas emissions
would be reduced accordingly. However, to the extent that some of the
vehicles considered in this action have already been built and sold,
the impacts of those vehicles achieving a lower fuel economy level than
their footprint-based standard represent an unavoidable adverse impact.
---------------------------------------------------------------------------
\41\ 49 U.S.C. 32912(b).
---------------------------------------------------------------------------
Both alternatives considered in the Draft EA and now this Final EA
result in increased fuel use compared to the no-action alternative;
however, the preferred alternative does result in marginally less
estimated fuel use than the ``as requested'' alternative. NHTSA does
not believe that establishing alternative CAFE standards at the
preferred alternative levels would contribute appreciably to any of the
environmental impacts considered in this Final EA.
NHTSA invited public comments on the contents and tentative
conclusions of the Draft EA. No public comments directly addressing the
Draft EA were received. One individual commenter loosely commented in
opposition to industry-wide fuel economy regulations based on, among
other things, concern about the quality and integrity of data used in
climate science.\42\ NHTSA disagrees with the commenter's assessment of
the quality and integrity of peer-reviewed studies on climate change,
and summarizes in the Final SEIS the panel-reviewed synthesis and
assessment reports from various agencies that NHTSA relies on,\43\ in
accordance with CEQ regulations to ensure the scientific integrity of
discussions and analyses in environmental documents.\44\ As discussed
in the Final SEIS, NHTSA relies on panel-reviewed synthesis and
assessment reports ``because these reports assess numerous individual
studies to draw general conclusions about the state of climate science
and potential impacts of climate change, as summarized or found in
peer-reviewed reports. These reports are reviewed and formally accepted
by, commissioned by, or in some cases authored by U.S. government
agencies and individual government scientists, and in many cases
reflect and convey the consensus conclusions of expert authors. These
sources have been vetted by both the climate change research community
and by the U.S. government.'' \45\ NHTSA notes here and in the Final
SEIS that uncertainty still exists, as with any analysis of complex,
long-term changes that involve many assumptions and uncertainties. That
is why ``NHTSA relies on methods and data to analyze climate impacts
that represent the best and most current information available on this
topic and that have been subjected to extensive peer review and
scrutiny.'' \46\
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\42\ NHTSA-2022-0048-0007, Attachment 1.
\43\ Final SEIS, at 5-1.
\44\ See, e.g., 40 CFR 1502.23.
\45\ Final SEIS, at 5-2.
\46\ Id.
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NHTSA did not make any changes to the Final EA in response to this
comment.
5. Agencies and Persons Consulted
NHTSA coordinated with EPA to seek its feedback on the Draft EA,
and EPA had no comments or suggested changes. NHTSA also coordinated
with EPA for further input in drafting the Final EA.
6. Finding of No Significant Impact
NHTSA has reviewed the information presented in this Final EA and
concludes that the proposed action will not have a significant effect
on the human environment and that a ``finding of no significant
impact'' is appropriate. This statement constitutes the agency's
``finding of no significant impact,'' and an environmental impact
statement will not be prepared.
[[Page 12756]]
Regulatory Text
List of Subjects in 49 CFR Part 531
Energy conservation, Gasoline, Imports, Motor vehicles.
In consideration of the foregoing, 49 CFR part 531 is amended as
follows:
PART 531--PASSENGER AUTOMOBILE AVERAGE FUEL ECONOMY STANDARDS
0
1. The authority citation for part 531 is revised to read as follows:
Authority: 49 U.S.C. 32902, delegation of authority at 49 CFR
1.95.
0
2. Amend Sec. 531.5 by:
0
a. Removing from paragraph (a) the term ``paragraph (f)'' and adding in
its place the term ``paragraph (e)'';
0
b. Revising paragraphs (e)(4) and (15); and
0
c. Adding paragraphs (e)(16) through (20).
The revisions and additions read as follows:
Sec. 531.5 Fuel economy standards.
* * * * *
(e) * * *
(4) Aston Martin Lagonda Limited
Table 8 to Sec. 531.5(e)(4)--Average Fuel Economy Standard
------------------------------------------------------------------------
(Miles per
Model year gallon)
------------------------------------------------------------------------
1979.................................................... 11.5
1980.................................................... 12.1
1981.................................................... 12.2
1982.................................................... 12.2
1983.................................................... 11.3
1984.................................................... 11.3
1985.................................................... 11.4
2008.................................................... 19.0
2009.................................................... 18.6
2010.................................................... 19.2
2011.................................................... 19.1
2012.................................................... 19.2
2013.................................................... 20.1
2014.................................................... 19.7
2015.................................................... 19.8
2016.................................................... 20.2
2017.................................................... 21.4
2018.................................................... 22.9
2019.................................................... 22.4
2020.................................................... 22.6
2021.................................................... 24.9
2022.................................................... 24.9
2023.................................................... 24.9
------------------------------------------------------------------------
* * * * *
(15) Spyker Automobielen B.V.
Table 19 to Sec. 531.5(e)(15)--Average Fuel Economy Standard
------------------------------------------------------------------------
(Miles per
Model year gallon)
------------------------------------------------------------------------
2006.................................................... 18.9
2007.................................................... 18.9
2008.................................................... 19.6
2009.................................................... 19.6
2010.................................................... 20.7
------------------------------------------------------------------------
(16) Ferrari
Table 20 to Sec. 531.5(e)(16)--Average Fuel Economy Standard
------------------------------------------------------------------------
(Miles per
Model year gallon)
------------------------------------------------------------------------
2016.................................................... 21.7
2017.................................................... 21.5
2018.................................................... 21.6
2020.................................................... 21.1
------------------------------------------------------------------------
(17) Koenigsegg
Table 21 to Sec. 531.5(e)(17)--Average Fuel Economy Standard
------------------------------------------------------------------------
(Miles per
Model year gallon)
------------------------------------------------------------------------
2015.................................................... 16.7
2018.................................................... 16.7
2019.................................................... 16.6
2020.................................................... 16.6
2021.................................................... 16.6
2022.................................................... 16.9
2023.................................................... 16.9
------------------------------------------------------------------------
(18) McLaren
Table 22 to Sec. 531.5(e)(18)--Average Fuel Economy Standard
------------------------------------------------------------------------
(Miles per
Model year gallon)
------------------------------------------------------------------------
2012.................................................... 23.2
2013.................................................... 24.0
2014.................................................... 23.8
2015.................................................... 22.9
2016.................................................... 23.2
2017.................................................... 24.3
2018.................................................... 23.3
2019.................................................... 22.5
2020.................................................... 22.5
2021.................................................... 21.5
2022.................................................... 24.6
2023.................................................... 25.7
------------------------------------------------------------------------
(19) Mobility Ventures
Table 23 to Sec. 531.5(e)(19)--Average Fuel Economy Standard
------------------------------------------------------------------------
(Miles per
Model year gallon)
------------------------------------------------------------------------
2014.................................................... 19.6
2015.................................................... 20.1
2016.................................................... 20.1
------------------------------------------------------------------------
(20) Pagani
Table 24 to Sec. 531.5(e)(20)--Average Fuel Economy Standard
------------------------------------------------------------------------
(Miles per
Model year gallon)
------------------------------------------------------------------------
2014.................................................... 15.6
2016.................................................... 15.6
2017.................................................... 15.6
2018.................................................... 15.6
2019.................................................... 15.5
2020.................................................... 15.5
2021.................................................... 15.5
2022.................................................... 15.5
2023.................................................... 15.5
------------------------------------------------------------------------
Issued under authority delegated in 49 CFR 1.95 and 49 CFR
501.4.
Sophie Shulman,
Deputy Administrator.
[FR Doc. 2024-03119 Filed 2-16-24; 8:45 am]
BILLING CODE 4910-59-P