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Proposed Rule2022-04934

Control of Air Pollution From New Motor Vehicles: Heavy-Duty Engine and Vehicle Standards

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Published

March 28, 2022

Issuing agencies

Environmental Protection Agency

Abstract

The Environmental Protection Agency (EPA) is proposing a rule that would reduce air pollution from highway heavy-duty vehicles and engines, including ozone, particulate matter, and greenhouse gases. This proposal would change the heavy-duty emission control program-- including the standards, test procedures, useful life, warranty, and other requirements--to further reduce the air quality impacts of heavy- duty engines across a range of operating conditions and over a longer period of the operational life of heavy-duty engines. Heavy-duty vehicles and engines are important contributors to concentrations of ozone and particulate matter and their resulting threat to public health, which includes premature death, respiratory illness (including childhood asthma), cardiovascular problems, and other adverse health impacts. This proposal would reduce emissions of nitrogen oxides and other pollutants. In addition, this proposal would make targeted updates to the existing Heavy-Duty Greenhouse Gas Emissions Phase 2 program, proposing that further GHG reductions in the MY 2027 timeframe are appropriate considering lead time, costs, and other factors, including market shifts to zero-emission technologies in certain segments of the heavy-duty vehicle sector. We also propose limited amendments to the regulations that implement our air pollutant emission standards for other sectors (e.g., light-duty vehicles, marine diesel engines, locomotives, various types of nonroad engines, vehicles, and equipment).

Full Text

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[Federal Register Volume 87, Number 59 (Monday, March 28, 2022)]
[Proposed Rules]
[Pages 17414-17888]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-04934]

[[Page 17413]]

Vol. 87

Monday,

No. 59

March 28, 2022

Part II

Environmental Protection Agency

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40 CFR Parts 2, 59, 60, et al.

Control of Air Pollution From New Motor Vehicles: Heavy-Duty Engine and
Vehicle Standards; Proposed Rule

Federal Register / Vol. 87 , No. 59 / Monday, March 28, 2022 /
Proposed Rules

[[Page 17414]]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 2, 59, 60, 80, 85, 86, 87, 600, 1027, 1030, 1033,
1036, 1037, 1039, 1042, 1043, 1045, 1048, 1051, 1054, 1060, 1065,
1066, 1068, and 1090

[EPA-HQ-OAR-2019-0055; FRL-7165-03-OAR]
RIN 2060-AU41

Control of Air Pollution From New Motor Vehicles: Heavy-Duty
Engine and Vehicle Standards

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing a rule
that would reduce air pollution from highway heavy-duty vehicles and
engines, including ozone, particulate matter, and greenhouse gases.
This proposal would change the heavy-duty emission control program--
including the standards, test procedures, useful life, warranty, and
other requirements--to further reduce the air quality impacts of heavy-
duty engines across a range of operating conditions and over a longer
period of the operational life of heavy-duty engines. Heavy-duty
vehicles and engines are important contributors to concentrations of
ozone and particulate matter and their resulting threat to public
health, which includes premature death, respiratory illness (including
childhood asthma), cardiovascular problems, and other adverse health
impacts. This proposal would reduce emissions of nitrogen oxides and
other pollutants. In addition, this proposal would make targeted
updates to the existing Heavy-Duty Greenhouse Gas Emissions Phase 2
program, proposing that further GHG reductions in the MY 2027 timeframe
are appropriate considering lead time, costs, and other factors,
including market shifts to zero-emission technologies in certain
segments of the heavy-duty vehicle sector. We also propose limited
amendments to the regulations that implement our air pollutant emission
standards for other sectors (e.g., light-duty vehicles, marine diesel
engines, locomotives, various types of nonroad engines, vehicles, and
equipment).

DATES: Comments: Written comments must be received on or before May 13,
2022. Under the Paperwork Reduction Act (PRA), comments on the
information collection provisions are best assured of consideration if
the Office of Management and Budget (OMB) receives a copy of your
comments on or before April 27, 2022.
Public Hearing: EPA plans to hold a virtual public hearing on April
12, 2022. An additional session may be held on April 13, 2022. Please
refer to Participation in Virtual Public Hearing in the SUPPLEMENTARY
INFORMATION section for additional information on the public hearing.

ADDRESSES: You may send comments, identified by Docket ID No. EPA-HQ-
OAR-2019-0055, by any of the following methods:
<bullet> Federal eRulemaking Portal: <a href="https://www.regulations.gov/">https://www.regulations.gov/</a>
(our preferred method). Follow the online instructions for submitting
comments.
<bullet> Email: <a href="/cdn-cgi/l/email-protection#68094509060c451a452c070b030d1c280d1809460f071e">[email&#160;protected]</a>. Include Docket ID No. EPA-
HQ-OAR-2019-0055 in the subject line of the message.
<bullet> Mail: U.S. Environmental Protection Agency, EPA Docket
Center, OAR, Docket EPA-HQ-OAR-2019-0055, Mail Code 28221T, 1200
Pennsylvania Avenue NW, Washington, DC 20460.
<bullet> Hand Delivery or Courier (by scheduled appointment only):
EPA Docket Center, WJC West Building, Room 3334, 1301 Constitution
Avenue NW, Washington, DC 20004. The Docket Center's hours of
operations are 8:30 a.m.-4:30 p.m., Monday-Friday (except Federal
Holidays).
Instructions: All submissions received must include the Docket ID
No. for this rulemaking. Comments received may be posted without change
to <a href="https://www.regulations.gov/">https://www.regulations.gov/</a>, including any personal information
provided. For detailed instructions on sending comments and additional
information on the rulemaking process, see the ``Public Participation''
heading of the SUPPLEMENTARY INFORMATION section of this document. Out
of an abundance of caution for members of the public and our staff, the
EPA Docket Center and Reading Room are open to the public by
appointment only to reduce the risk of transmitting COVID-19. Our
Docket Center staff also continues to provide remote customer service
via email, phone, and webform. Hand deliveries and couriers may be
received by scheduled appointment only. For further information on EPA
Docket Center services and the current status, please visit us online
at <a href="https://www.epa.gov/dockets">https://www.epa.gov/dockets</a>.
Public Hearing. EPA plans to hold a virtual public hearing for this
rulemaking. Please refer to Participation in Virtual Public Hearing in
the SUPPLEMENTARY INFORMATION section for additional information.

FOR FURTHER INFORMATION CONTACT: Brian Nelson, Assessment and Standards
Division, Office of Transportation and Air Quality, Environmental
Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105;
telephone number: (734) 214-4278; email address: <a href="/cdn-cgi/l/email-protection#92fcf7fee1fdfcbcf0e0fbf3fcd2f7e2f3bcf5fde4">[email&#160;protected]</a>.

SUPPLEMENTARY INFORMATION:

A. Public Participation

Written Comments

Submit your comments, identified by Docket ID No. EPA-HQ-OAR-2019-
0055, at <a href="https://www.regulations.gov">https://www.regulations.gov</a> (our preferred method), or the
other methods identified in the ADDRESSES section. Once submitted,
comments cannot be edited or removed from the docket. 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 <a href="https://www.epa.gov/dockets/commenting-epa-dockets">https://www.epa.gov/dockets/commenting-epa-dockets</a>.
Due to public health concerns related to COVID-19, the EPA Docket
Center and Reading Room are open to the public by appointment only. Our
Docket Center staff also continues to provide remote customer service
via email, phone, and webform. Hand deliveries or couriers will be
received by scheduled appointment only. For further information and
updates on EPA Docket Center services, please visit us online at
<a href="https://www.epa.gov/dockets">https://www.epa.gov/dockets</a>.
The EPA continues to carefully and continuously monitor information
from the Centers for Disease Control and Prevention (CDC), local area
health departments, and our Federal partners so that we can respond
rapidly as conditions change regarding COVID-19.

Participation in Virtual Public Hearing

Please note that because of current CDC recommendations, as well as
state and local orders for social distancing to

[[Page 17415]]

limit the spread of COVID-19, EPA cannot hold in-person public meetings
at this time.
The EPA plans to hold a virtual public hearing on April 12, 2022.
An additional session may be held on April 13, 2022. This hearing will
be held using Zoom. In order to attend the virtual public hearing, all
attendees (including those who will not be presenting verbal testimony)
must register in advance. EPA will begin registering speakers for the
hearing upon publication of this document in the Federal Register. To
register, please use the registration link that will be available on
the EPA rule web page once registration begins: <a href="https://www.epa.gov/regulations-emissions-vehicles-and-engines/proposed-rule-and-related-materials-control-air-1">https://www.epa.gov/regulations-emissions-vehicles-and-engines/proposed-rule-and-related-materials-control-air-1</a>. A separate registration form must be submitted
for each person attending the hearing.
The last day to register to speak at the hearing will be five
working days before the first public hearing date. The EPA will post a
general agenda for the hearing with the order of speakers at: <a href="https://www.epa.gov/regulations-emissions-vehicles-and-engines/proposed-rule-and-related-materials-control-air-1">https://www.epa.gov/regulations-emissions-vehicles-and-engines/proposed-rule-and-related-materials-control-air-1</a>. This agenda will be available no
later than two working days before the first public hearing date.
In order to allow everyone to be heard, EPA is limiting verbal
testimony to three minutes per person. Speakers will not be able to
share graphics via the virtual public hearing. Speakers will be able to
request an approximate speaking time as part of the registration
process, with preferences considered on a first-come, first-served
basis. EPA also recommends submitting the text of oral comments as
written comments to the rulemaking docket.
EPA will make every effort to follow the schedule as closely as
possible on the day of the hearing; however, please plan for the
hearings to run either ahead of schedule or behind schedule.
The EPA may ask clarifying questions during the oral presentations,
but will not respond to the presentations at that time. Written
statements and supporting information submitted during the comment
period will be considered with the same weight as oral comments and
supporting information presented at the public hearing.
Please note that any updates made to any aspect of the hearing will
be posted online at: <a href="https://www.epa.gov/regulations-emissions-vehicles-and-engines/proposed-rule-and-related-materials-control-air-1">https://www.epa.gov/regulations-emissions-vehicles-and-engines/proposed-rule-and-related-materials-control-air-1</a>.
While the EPA expects the hearing to go forward as described here,
please monitor our website or contact Tuana Phillips, (202)-565-0074,
<a href="/cdn-cgi/l/email-protection#aedec6c7c2c2c7dedd80dadbcfc0cfeecbdecf80c9c1d8">[email&#160;protected]</a> to determine if there are any updates. The EPA
does not intend to publish a document in the Federal Register
announcing updates.
If you require the services of a translator or special
accommodations such as audio description, please identify these needs
when you register for the hearing or by contacting Tuana Phillips at
(202)-565-0074, <a href="/cdn-cgi/l/email-protection#6e1e06070202071e1d401a1b0f000f2e0b1e0f40090118">[email&#160;protected]</a>. EPA may not be able to arrange
accommodations without advance notice.

B. General Information

Does this action apply to me?

This action relates to companies that manufacture, sell, or import
into the United States new heavy-duty highway engines. Additional
amendments apply for gasoline refueling facilities and for
manufacturers of all sizes and types of motor vehicles, stationary
engines, aircraft and aircraft engines, and various types of nonroad
engines, vehicles, and equipment. Regulated categories and entities
include the following:

------------------------------------------------------------------------
NAICS codes \a\ NAICS title
------------------------------------------------------------------------
326199............................ All Other Plastics Product
Manufacturing.
332431............................ Metal Can Manufacturing.
335312............................ Motor and Generator Manufacturing.
336111............................ Automobile Manufacturing.
336112............................ Light Truck and Utility Vehicle
Manufacturing.
336120............................ Heavy Duty Truck Manufacturing.
336211............................ Motor Vehicle Body Manufacturing.
336212............................ Truck Trailer Manufacturing.
336213............................ Motor Home Manufacturing.
336411............................ Manufacturers of new aircraft.
336412............................ Manufacturers of new aircraft
engines.
333618............................ Other Engine Equipment
Manufacturing.
336999............................ All Other Transportation Equipment
Manufacturing.
423110............................ Automotive and Other Motor Vehicle
Merchant Wholesalers.
447110............................ Gasoline Stations with Convenience
Stores.
447190............................ Other Gasoline Stations.
454310............................ Fuel dealers.
811111............................ General Automotive Repair.
811112............................ Automotive Exhaust System Repair.
811198............................ All Other Automotive Repair and
Maintenance.
------------------------------------------------------------------------
\a\ NAICS Association. NAICS & SIC Identification Tools. Available
online: <a href="https://www.naics.com/search">https://www.naics.com/search</a>.

This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be regulated by this
action. This table lists the types of entities that EPA is now aware
could potentially be regulated by this action. Other types of entities
not listed in the table could also be regulated. To determine whether
your entity is regulated by this action, you should carefully examine
the applicability criteria found in Sections XII and XIII of this
preamble. If you have questions regarding the applicability of this
action to a particular entity, consult the person listed in the FOR
FURTHER INFORMATION CONTACT section.

What action is the agency taking?

The Environmental Protection Agency (EPA) is proposing a rule that
would reduce air pollution from highway heavy-duty vehicles and
engines. This proposal would change the heavy-duty emission control
program--including the standards, test procedures, regulatory useful
life, emission-related warranty, and other requirements--to further
reduce the air quality impacts of heavy-duty engines across a range of
operating conditions and over a longer period of the operational life
of heavy-duty engines. Heavy-duty vehicles and engines are important
contributors to concentrations of ozone and particulate matter and
their resulting threat to public health, which includes premature
death, respiratory illness (including childhood asthma), cardiovascular
problems, and other adverse health impacts. This proposal would reduce
emissions of nitrogen oxides and other pollutants. In addition, this
proposal would make targeted updates to the existing Heavy-Duty
Greenhouse Gas Emissions Phase 2 program, proposing that further GHG
reductions in the MY 2027 timeframe are appropriate considering lead
time, costs, and other factors, including market shifts to zero-
emission technologies in certain segments of the heavy-duty vehicle
sector.

What is the agency's authority for taking this action?

Section 202(a)(1) of the Clean Air Act requires the EPA to set
emission standards for air pollutants from new motor vehicles or new
motor vehicle engines, which the Administrator has found cause or
contribute to air pollution that may endanger public health or welfare.
See Sections I.A.4, I.F, and XIV of this preamble for more information
on the agency's authority for this action.

What are the incremental costs and benefits of this action?

We compare total monetized health benefits to total costs
associated with the proposed Options 1 and 2 in Section IX. Our results
show that annual benefits of the proposed Option 1 would be larger than
the annual costs in 2045, a year when the program would be fully
implemented and when most of the regulated fleet would have turned
over,

[[Page 17416]]

with annual net benefits of $9 and $31 billion assuming a 3 percent
discount rate, and net benefits of $8 and $28 billion assuming a 7
percent discount rate.\1\ Annual benefits would also be larger than
annual costs in 2045 for the proposed Option 2, although net benefits
would be lower than from the proposed Option 1 (net benefits of
proposed Option 2 would be $6 and $23 billion at a 3 percent discount
rate, and net benefits of $5 and 21 billion at a 7 percent discount
rate). See Section VIII for more details on the net benefit estimates.
For both the proposed Options 1 and 2, benefits also outweigh the costs
when expressed in present value terms and as equalized annual values.
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\1\ The range of benefits and net benefits reflects a
combination of assumed PM<INF>2.5</INF> and ozone mortality risk
estimates and selected discount rate.
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Did EPA conduct a peer review before issuing this action?

This regulatory action was supported by influential scientific
information. Therefore, EPA conducted peer reviews in accordance with
OMB's Final Information Quality Bulletin for Peer Review. Specifically,
we conducted peer reviews on five analyses: (1) Analysis of Heavy-Duty
Vehicle Sales Impacts Due to New Regulation (Sales Impacts), (2)
Exhaust Emission Rates for Heavy-Duty Onroad Vehicles in MOVES_CTI NPRM
(Emission Rates), (3) Population and Activity of Onroad Vehicles in
MOVES_CTI NPRM (Population and Activity), (4) Cost teardowns of Heavy-
Duty Valvetrain (Valvetrain costs), and (5) Cost teardown of Emission
Aftertreatment Systems (Aftertreatment Costs). These peer reviews were
all letter reviews conducted by a contractor. The peer review reports
for each analysis are located in the docket for this action and at
EPA's Science Inventory (<a href="https://cfpub.epa.gov/si/">https://cfpub.epa.gov/si/</a>).

Table of Contents

ES. Executive Summary
A. Purpose of the Regulatory Action
B. Overview of the Regulatory Action
C. Summary of the Major Provisions in the Regulatory Action
D. Projected Emission Reductions, Air Quality Improvements,
Costs, and Benefits
E. Summary of Specific Requests for Comments
I. Introduction
A. Brief Overview of the Heavy-Duty Truck Industry
B. History of Emission Standards for Heavy-Duty Engines and
Vehicles
C. Petitions to EPA for Additional NO<INF>X</INF> Emissions
Control
D. California Heavy-Duty Highway Low NO<INF>X</INF> Program
Development
E. Advance Notice of Proposed Rulemaking
F. EPA Statutory Authority for the Proposal
G. Basis of the Proposed Standards
II. Need for Additional Emissions Control
A. Background on Pollutants Impacted by This Proposal
B. Health Effects Associated With Exposure to Pollutants
Impacted by This Proposal
C. Environmental Effects Associated With Exposure to Pollutants
Impacted by This Proposal
III. Proposed Test Procedures and Standards
A. Overview
B. Summary of Compression-Ignition Exhaust Emission Standards
and Duty Cycle Test Procedures
C. Summary of Compression-Ignition Off-Cycle Standards and In-
Use Test Procedures
D. Summary of Spark-Ignition Heavy-Duty Engine Exhaust Emission
Standards and Test Procedures
E. Summary of Spark-Ignition Heavy-Duty Vehicle Refueling
Emission Standards and Test Procedures
IV. Compliance Provisions and Flexibilities
A. Regulatory Useful Life
B. Ensuring Long-Term In-Use Emissions Performance
C. Onboard Diagnostics
D. Inducements
E. Certification Updates
F. Durability Testing
G. Averaging, Banking, and Trading
H. Early Adoption Incentives
I. Compliance Options for Generating NO<INF>X</INF> Emission
Credits From Electric Vehicles
J. Fuel Quality
K. Other Flexibilities Under Consideration
V. Program Costs
A. Technology Package Costs
B. Operating Costs
C. Program Costs
VI. Estimated Emission Reductions From the Proposal and Alternatives
A. Emission Inventory Methodology
B. Estimated Emission Reductions From the Proposed Criteria
Pollutant Program
C. Estimated Emission Reductions From the Alternatives Analyzed
D. Evaluating Emission Impacts of Electric Vehicles in the
Proposed Emission Inventory Baseline
VII. Air Quality Impacts of the Proposed Rule
A. Ozone
B. Particulate Matter
C. Nitrogen Dioxide
D. Carbon Monoxide
E. Air Toxics
F. Visibility
G. Nitrogen Deposition
H. Demographic Analysis of Air Quality
VIII. Benefits of the Program
IX. Comparison of Benefits and Costs
A. Methods
B. Results
X. Economic Impact Analysis
A. Impact on Vehicle Sales, Mode Shift, and Fleet Turnover
B. Employment Impacts
XI. Targeted Updates to the HD GHG Phase 2 Heavy-Duty Greenhouse Gas
Emissions Program
A. Background on Heavy-Duty Greenhouse Gas Emission Standards
B. What has changed since we finalized the HD GHG Phase 2 rule?
C. Proposed Changes to HD GHG Phase 2 CO<INF>2</INF> Standards
for Targeted Subcategories
D. HD GHG Phase 2 Advanced Technology Credits for CO<INF>2</INF>
Emissions
E. Emissions and Cost Impacts of Proposed Revised MY 2027
CO<INF>2</INF> Emission Standards
F. Summary of Proposed Changes to HD GHG Phase 2
XII. Other Amendments
A. General Compliance Provisions (40 CFR Part 1068) and Other
Cross-Sector Issues
B. Heavy-Duty Highway Engine and Vehicle Emission Standards (40
CFR Parts 1036 and 1037)
C. Fuel Dispensing Rates for Heavy-Duty Vehicles (40 CFR Parts
80 and 1090)
D. Refueling Interface for Motor Vehicles (40 CFR Parts 80 and
1090)
E. Light-Duty Motor Vehicles (40 CFR Parts 85, 86, and 600)
F. Large Nonroad Spark-Ignition Engines (40 CFR Part 1048)
G. Small Nonroad Spark-Ignition Engines (40 CFR Part 1054)
H. Recreational Vehicles and Nonroad Evaporative Emissions (40
CFR Parts 1051 and 1060)
I. Marine Diesel Engines (40 CFR Parts 1042 and 1043)
J. Locomotives (40 CFR Part 1033)
K. Stationary Compression-Ignition Engines (40 CFR Part 60,
Subpart IIII)
L. Heavy-Duty Compression-Ignition Engines (40 CFR Part 86)
XIII. Executive Orders Reviews
A. Executive Order 12866: Regulatory Planning and Review and
Executive Order 13563: Improving Regulation and Regulatory Review
B. Paperwork Reduction Act (PRA)
C. Regulatory Flexibility Act (RFA)
D. Unfunded Mandates Reform Act (UMRA)
E. Executive Order 13132: Federalism
F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
G. Executive Order 13045: Protection of Children From
Environmental Health and Safety Risks
H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
I. National Technology Transfer and Advancement Act (NTTAA) and
1 CFR Part 51
J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations.
XIV. Statutory Provisions and Legal Authority

Executive Summary

A. Purpose of the Regulatory Action

The Environmental Protection Agency (EPA) is proposing a
multipollutant rule to further reduce air pollution from heavy-duty
engines and vehicles across the United States, including ozone and
particulate matter (PM). In addition, as part of this rulemaking we are
proposing

[[Page 17417]]

targeted updates to the existing Heavy-Duty Greenhouse Gas Emissions
Phase 2 program (HD GHG Phase 2). This proposed rulemaking builds on
and improves the existing emission control program for on-highway
heavy-duty engines and vehicles. This proposal is pursuant to EPA's
authority under the Clean Air Act to regulate air pollutants emitted
from mobile sources. The proposal is also consistent with Executive
Order (E.O.) 14037, which directed EPA to consider setting new oxides
of nitrogen (NO<INF>X</INF>) emission standards and updating the
existing GHG emissions standards for heavy-duty engines and
vehicles.2 3 In this proposed action, EPA is co-proposing
two regulatory options for new NO<INF>X</INF> standards: Proposed
Option 1 and proposed Option 2. As discussed in Section B.1 of this
Executive Summary and throughout this preamble, we request comment on
the options presented, as well as the full range of options between
them.
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\2\ President Joseph Biden. Executive Order on Strengthening
American Leadership in Clean Cars and Trucks. 86 FR 43583, August
10, 2021.
\3\ Oxides of nitrogen (NO<INF>X</INF>) refers to nitric oxide
(NO) and nitrogen dioxide (NO<INF>2</INF>).
---------------------------------------------------------------------------

Heavy-duty (HD) engines operating across the U.S. emit
NO<INF>X</INF> and other pollutants that contribute to ambient levels
of ozone, PM, and NO<INF>X</INF>. These pollutants are linked to
premature death, respiratory illness (including childhood asthma),
cardiovascular problems, and other adverse health impacts. Data show
that heavy-duty engines are important contributors to concentrations of
ozone and PM<INF>2.5</INF> and their resulting threat to public
health.\4\ \5\
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\4\ Zawacki et al, 2018. Mobile source contributions to ambient
ozone and particulate matter in 2025. Atmospheric Environment, Vol
188, pg 129-141. Available online: <a href="https://doi.org/10.1016/j.atmosenv.2018.04.057">https://doi.org/10.1016/j.atmosenv.2018.04.057</a>.
\5\ Davidson et al, 2020. The recent and future health burden of
the U.S. mobile sector apportioned by source. Environmental Research
Letters. Available online: <a href="https://doi.org/10.1088/1748-9326/ab83a8">https://doi.org/10.1088/1748-9326/ab83a8</a>.
---------------------------------------------------------------------------

The proposed rulemaking would change key provisions of the heavy-
duty emission control program--including the standards, test
procedures, regulatory useful life, emission-related warranty, and
other requirements; the two regulatory options (proposed Options 1 and
2) would result in different numeric levels of the standards and
lengths of useful life and warranty periods. The proposed Options 1 and
2 and the range between them provide the numeric values for these key
provisions that we focus on for this proposal. Together, the key
provisions in the proposal would further reduce the air quality impacts
of heavy-duty engines across a range of operating conditions and over a
longer period of the operational life of heavy-duty engines (see
Section I.B for an overview of the proposed program). The requirements
in the proposed Option 1 and the proposed Option 2 would lower
emissions of NO<INF>X</INF> and other air pollutants (PM, hydrocarbons
(HC), air toxics, and carbon monoxide (CO)) beginning as early as model
year (MY) 2027. The emission reductions from both the proposed Option 1
and the proposed Option 2 would increase over time as more new, cleaner
vehicles enter the fleet.
We estimate that if finalized as proposed, the proposed Option 1
would reduce NO<INF>X</INF> emissions from heavy-duty vehicles in 2040
by more than 50 percent; by 2045, a year by which most of the regulated
fleet would have turned over, heavy-duty NO<INF>X</INF> emissions would
be more than 60 percent lower than they would have been without this
action. Our estimates show proposed Option 2 would reduce heavy-duty
NO<INF>X</INF> emissions in 2045 by 47 percent (see Section I.D for
more information on our projected emission reductions from proposed
Option 1 or 2). These emission reductions would result in air quality
improvements in ozone and PM<INF>2.5</INF>; we estimate that in 2045,
the proposed Option 1 would result in total annual monetized ozone- and
PM<INF>2.5</INF>-related benefits of $12 and $33 billion at a 3 percent
discount rate, and $10 and $30 billion at a 7 percent discount rate. In
the same calendar year, proposed Option 2 would result in total annual
monetized ozone- and PM<INF>2.5</INF>-related benefits of $9 and $26
billion at a 3 percent discount rate, and $8 and $23 billion at a 7
percent discount (see Section VIII for discussion on quantified and
monetized health impacts). Given the analysis we present in this
proposal, we currently believe that Option 1 may be a more appropriate
level of stringency as it would result in a greater level of achievable
emission reduction for the model years proposed, which is consistent
with EPA's statutory authority under Clean Air Act section 202(a)(3).
These emission reductions would result in widespread decreases in
ambient concentrations of pollutants such as ozone and
PM<INF>2.5</INF>. These widespread projected air quality improvements
would play an important role in addressing concerns from states, local
communities, and Tribal governments about the contributions of heavy-
duty engines to air quality challenges they face such as meeting their
obligations to attain or continue to meet National Ambient Air Quality
Standards (NAAQS), and to reduce other human health and environmental
impacts of air pollution.
In addition to further reducing emissions of NO<INF>X</INF> and
other ozone and PM<INF>2.5</INF> precursors, as part of this rulemaking
we are proposing targeted updates to the existing Heavy-Duty Greenhouse
Gas Emissions Phase 2 program (HD GHG Phase 2).\6\ The proposed updates
would apply to certain CO<INF>2</INF> standards for MYs 2027 and later
trucks that are appropriate considering lead time, costs, and other
factors, including market shifts to zero-emission technologies in
certain segments of the heavy-duty vehicle sector. The proposed updates
are intended to balance further incentivizing zero and near-zero
emissions vehicle development with ensuring that the standards achieve
an appropriate fleet-wide level of CO<INF>2</INF> emissions reductions.
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\6\ 81 FR at 73478 (October 25, 2016).
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1. Industry Overview
Heavy-duty highway vehicles (also referred to as ``trucks'' in this
preamble) range from vocational vehicles that support local and
regional construction, refuse collection, and delivery work to long-
haul tractor-trailers that move freight cross-country. This diverse
array of vehicles is categorized into weight classes based on gross
vehicle weight ratings (GVWR) that span Class 2b trucks and vans
greater than 8,500 lbs GVWR through Class 8 long-haul tractors and
other commercial vehicles that exceed 33,000 lbs GVWR.\7\ These
vehicles are primarily powered by diesel-fueled, compression-ignition
(CI) engines, although gasoline-fueled, spark-ignition (SI) engines are
common in the lighter weight classes, and

[[Page 17418]]

smaller numbers of alternative fuel engines (e.g., liquified petroleum
gas, compressed natural gas) are found in the heavy-duty fleet.
Vehicles powered by electricity, either in the form of battery electric
vehicles (BEVs) or fuel cell electric vehicles (FCEVs) are also
increasingly entering the heavy-duty fleet. The operational
characteristics of some commercial applications (e.g., delivery
vehicles) can be similar across several vehicle weight classes,
allowing a single engine, or electric power source in the case of BEVs
and FCEVs, to be installed in a variety of vehicles. For instance,
engine specifications needed for a Class 4 parcel delivery vehicle may
be similar to the needs of a Class 5 mixed freight delivery vehicle or
a Class 6 beverage truck. Performance differences needed to operate
across this range of vehicles can be achieved through adjustments to
chassis-based systems (e.g., transmission, cooling system) external to
the engine.
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\7\ This proposed rulemaking includes revised criteria pollutant
standards for engine-certified Class 2b through 8 heavy-duty engines
and vehicles; this proposal also includes revised GHG standards for
Class 4 through 8 vehicles. Class 2b and 3 vehicles with GVWR
between 8,500 and 14,000 pounds are primarily commercial pickup
trucks and vans and are sometimes referred to as ``medium-duty
vehicles''. The majority of Class 2b and 3 vehicles are chassis-
certified vehicles, and EPA intends to include them in a future
combined light-duty and medium-duty rulemaking action, consistent
with E.O, 14037, Section 2a. Heavy-duty engines and vehicles are
also used in nonroad applications, such as construction equipment;
nonroad heavy-duty engines and vehicles are not the focus of this
proposal. See Section I for more discussion on the spectrum of
heavy-duty vehicles and how they relate to the proposed rule. As
outlined in Section C of this Executive Summary and detailed in
Section XII, this proposal also includes limited amendments to
regulations that implement our air pollutant emission standards for
other industry sectors, including light-duty vehicles, light-duty
trucks, marine diesel engines, locomotives, and various types of
nonroad engines, vehicles, and equipment.
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2. The Need for Additional Emission Control of NO<INF>X</INF> and Other
Pollutants From Heavy-Duty Engines
Across the U.S., NO<INF>X</INF> emissions from heavy-duty engines
are important contributors to concentrations of ozone and
PM<INF>2.5</INF> and their resulting health effects.8 9
Heavy-duty engines will continue to be one of the largest contributors
to mobile source NO<INF>X</INF> emissions nationwide in the future,
representing 32 percent of the mobile source NO<INF>X</INF> emissions
in calendar year 2045.\10\ Furthermore, it is estimated that heavy-duty
engines would represent 89 percent of the onroad NO<INF>X</INF>
inventory in calendar year 2045.\11\ Reducing NO<INF>X</INF> emissions
is a critical part of many areas' strategies to attain and maintain the
ozone and PM NAAQS; many state and local agencies anticipate challenges
in attaining the NAAQS, maintaining the NAAQS in the future, and/or
preventing nonattainment (see Section II). Some nonattainment areas
have already been ``bumped up'' to higher classifications because of
challenges in attaining the NAAQS.\12\
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\8\ Zawacki et al, 2018. Mobile source contributions to ambient
ozone and particulate matter in 2025. Atmospheric Environment, Vol
188, pg 129-141. Available online: <a href="https://doi.org/10.1016/j.atmosenv.2018.04.057">https://doi.org/10.1016/j.atmosenv.2018.04.057</a>.
\9\ Davidson et al, 2020. The recent and future health burden of
the U.S. mobile sector apportioned by source. Environmental Research
Letters. Available online: <a href="https://doi.org/10.1088/1748-9326/ab83a8">https://doi.org/10.1088/1748-9326/ab83a8</a>.
\10\ U.S. Environmental Protection Agency (2021). 2016v1
Platform. <a href="https://www.epa.gov/air-emissions-modeling/2016v1-platform">https://www.epa.gov/air-emissions-modeling/2016v1-platform</a>.
\11\ Han, Jaehoon. Memorandum to the Docket EPA-HQ-OAR-2019-
0055: ``MOVES Modeling-Related Data Files (MOVES Code, Input
Databases and Runspecs) for the Proposed Heavy-Duty 2027
Standards''. February 2022.
\12\ For example, in September 2019 several 2008 ozone
nonattainment areas were reclassified from moderate to serious,
including Dallas, Chicago, Connecticut, New York/New Jersey and
Houston, and in January 2020, Denver. The 2008 NAAQS for ozone is an
8-hour standard with a level of 0.075 ppm, which the 2015 ozone
NAAQS lowered to 0.070 ppm.
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In addition, emissions from heavy-duty engines can significantly
affect individuals living near truck freight routes. Based on a study
EPA conducted of people living near truck routes, an estimated 72
million people live within 200 meters of a truck freight route (see
discussion in Section II.B.7). Relative to the rest of the population,
people of color and those with lower incomes are more likely to live
near truck routes (see Sections II.B and VII.H for additional
discussion on our analysis of environmental justice impacts of this
proposal). This population includes children, and in addition,
childcare facilities and schools can be in close proximity to freight
routes.\13\
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\13\ Kingsley, S., Eliot, M., Carlson, L. et al. Proximity of US
schools to major roadways: a nationwide assessment. J Expo Sci
Environ Epidemiol 24, 253-259 (2014). <a href="https://doi.org/10.1038/jes.2014.5">https://doi.org/10.1038/jes.2014.5</a>.
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Clean Air Act section 202(a)(3)(A) requires EPA to set emission
standards for NO<INF>X</INF>, PM, HC, and CO that reflect the greatest
degree of emission reduction achievable through the application of
technology that will be available for the model year to which such
standards apply. Although heavy-duty engines have become much cleaner
over the last decade, catalysts and other technologies have evolved
such that harmful air pollutants can be reduced even further.
Heavy-duty emissions that affect local and regional populations are
attributable to several engine operating modes and processes.
Specifically, the operating modes and processes projected to contribute
the most to the heavy-duty NO<INF>X</INF> emission inventory in 2045
are medium-to-high load (36 percent), low-load (28 percent), and aging
(24 percent) (i.e., deterioration and mal-maintenance of the engine's
emission control system) (see Section VI for more information on
projected inventory contributions from each operating mode or process).
These data suggest that medium- and high-load operating conditions
continue to merit concern, while also showing that opportunities for
significant additional emission reductions and related air quality
improvements can be achieved through provisions that encourage emission
control under low-load operation and throughout an engine's operational
life. Our approach for provisions that address these aspects of the
emission inventory is outlined below and described in more detail in
sections that follow.
As described in Section III, the standards in proposed Options 1
and 2 would reduce emissions during a broader range of operating
conditions that span nearly all in-use operation. The standards in
proposed Options 1 and 2 are based on technology improvements which
have become available over the 20 years since the last major rule was
promulgated to address emissions of NO<INF>X</INF>, PM, HC, and CO
(hereafter referred to as ``criteria pollutants'') and toxic pollutants
from heavy-duty engines. As further detailed in Section III, available
data indicate that emission levels demonstrated for certification are
not achieved under the broad range of real-world operating
conditions.14 15 16 17 In fact, less than ten percent of the
data collected during a typical test while the vehicle is operated on
the road is subject to EPA's in-use, on-the-road emission
standards.\18\ These testing data further show that NO<INF>X</INF>
emissions from heavy-duty diesel vehicles are high during many periods
of vehicle operation that are not subject to current on-the-road
emission standards. For example, ``low-load'' engine conditions occur
when a vehicle operates in stop-and-go traffic or is idling; these low-
load conditions can result in exhaust temperature decreases that then
lead to the diesel engine's selective catalytic reduction (SCR)-based
emission control system becoming less effective or ceasing to function.
Test data collected as part of EPA's manufacturer-run in-use testing
program indicate that this low-load operation could account for more
than half of the NO<INF>X</INF> emissions from a

[[Page 17419]]

vehicle during a typical workday.\19\ Similarly, heavy-duty SI engines
also operate in conditions where their catalyst technology becomes less
effective, resulting in higher levels of air pollutants; however,
unlike CI engines, it is sustained medium-to-high load operation where
emission levels are less certain.
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\14\ Hamady, Fakhri, Duncan, Alan. ``A Comprehensive Study of
Manufacturers In-Use Testing Data Collected from Heavy-Duty Diesel
Engines Using Portable Emissions Measurement System (PEMS).'' 29th
CRC Real World Emissions Workshop, March 10-13, 2019.
\15\ Sandhu, Gurdas, et al. ``Identifying Areas of High
NO<INF>X</INF> Operation in Heavy-Duty Vehicles''. 28th CRC Real-
World Emissions Workshop, March 18-21, 2018.
\16\ Sandhu, Gurdas, et al. ``In-Use Emission Rates for MY 2010+
Heavy-Duty Diesel Vehicles''. 27th CRC Real-World Emissions
Workshop, March 26-29, 2017.
\17\ As noted in Section C of this Executive Summary and
discussed in Section III, testing engines and vehicles while they
are operating over the road without a defined duty cycle is referred
to as ``off-cycle'' testing; as detailed in Section III, we are
proposing new off-cycle test procedures and standards as part of
this rulemaking.
\18\ Heavy-duty CI engines are currently subject to off-cycle
standards that are not limited to specific test cycles, but we use
the term ``on-the-road'' here for readability.
\19\ Sandhu, Gurdas, et al. ``Identifying Areas of High
NO<INF>X</INF> Operation in Heavy-Duty Vehicles''. 28th CRC Real-
World Emissions Workshop, March 18-21, 2018.
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As noted in this Section A.2 of the Executive Summary,
deterioration and mal-maintenance of the engine's emission control
system is also projected to result in NO<INF>X</INF> emissions that
would represent a substantial part of the HD inventory in 2045. To
address this problem, as part of our comprehensive approach, both
proposed Options 1 and 2 include longer regulatory useful life and
emission-related warranty requirements that would maintain emission
control through more of the operational life of heavy-duty vehicles
(see Section IV for more discussion on the proposed useful life and
warranty requirements).
Reducing NO<INF>X</INF> emissions from heavy-duty vehicles would
address health and environmental issues raised by state, local, and
Tribal agencies in their comments on the Advance Notice of Proposed
Rule (ANPR).\20\ In addition to concerns about meeting the ozone and
PM<INF>2.5</INF> NAAQS, they expressed concerns about environmental
justice, regional haze, and damage to terrestrial and aquatic
ecosystems. They mentioned the impacts of NO<INF>X</INF> emissions on
numerous locations, such as the Chesapeake Bay, Narragansett Bay, Long
Island Sound, Joshua Tree National Park and the surrounding Mojave
Desert, the Adirondacks, and other areas. Tribes and agencies commented
that NO<INF>X</INF> deposition into lakes is harmful to fish and other
aquatic life forms on which they depend for subsistence livelihoods.
They also commented that regional haze and increased rates of
weathering caused by pollution are of particular concern and can damage
culturally significant archeological sites.
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\20\ The Agency published an ANPR on January 21, 2020 to present
EPA's early thinking on this rulemaking and solicit feedback from
stakeholders to inform this proposal (85 FR 3306).
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3. The Historic Opportunity for Clean Air Provided by Zero-Emission
Vehicles
We are at the early stages of a significant transition in the
history of the heavy-duty on-highway sector--a shift to zero-emission
vehicle (ZEV) technologies. This change is underway and presents an
opportunity for significant reductions in heavy-duty vehicle emissions.
Major trucking fleets, manufacturers and U.S. states have announced
plans to transition the heavy-duty fleet to zero-emissions technology,
and over just the past few years we have seen the early introduction of
zero-emission technology into a number of heavy-duty vehicle market
segments.
Executive Order 14037 identifies three potential regulatory actions
for EPA to consider: (1) This proposed rule for heavy-duty vehicles for
new criteria pollutant standards and strengthening of the Model Year
2027 GHG standards; (2) a separate rulemaking to establish more
stringent criteria and GHG emission standards for medium-duty vehicles
for Model Year 2027 and later (in combination with light-duty
vehicles); and (3) a third rulemaking to establish new GHG standards
for heavy-duty vehicles for Model Year 2030 and later. This strategy
will establish the EPA regulatory path for the future of the heavy-duty
vehicle sector, and in each of these actions EPA will consider the
critical role of ZEVs in enabling stringent emission standards.
In addition to the proposed standards and requirements for
NO<INF>X</INF> and other air pollutant emissions, we are also proposing
targeted revisions to the already stringent HD GHG Phase 2 rulemaking,
which EPA finalized in 2016.\21\ The HD GHG Phase 2 program includes
GHG emission standards tailored to certain regulatory vehicle
categories in addition to heavy-duty engines including: Combination
tractors; vocational vehicles; and heavy-duty pickup trucks and vans.
The HD GHG Phase 2 program includes progressively more stringent
CO<INF>2</INF> emission standards for HD engines and vehicles; these
standards phase in starting in MY 2021 through MY 2027. The program
built upon the GHG Phase 1 program promulgated in 2011, which set the
first-ever GHG emission standards for heavy-duty engines and
trucks.\22\
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\21\ 81 FR 73478 (October 25, 2016). Note that the HD GHG Phase
2 program also includes coordinated fuel efficiency standards
established by the U.S. Department of Transportation through the
National Highway Traffic Safety Administration, and those standards
were established in a joint rulemaking process with EPA.
\22\ 76 FR 57106, September 15, 2011.
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When the HD GHG Phase 2 rule was promulgated in 2016, we
established the Phase 2 GHG standards and advanced technology
incentives on the premise that electrification of the heavy-duty market
was unlikely to occur in the timeframe of the program. However, several
factors have arisen since the adoption of Phase 2 that have changed our
outlook for heavy-duty electric vehicles. First, the heavy-duty market
has evolved such that in 2021, there are a number of manufacturers
producing fully electric heavy-duty vehicles in a number of
applications. Second, the State of California has adopted an Advanced
Clean Trucks program that includes a manufacturer sales requirement for
zero-emission truck sales, specifically that ``manufacturers who
certify Class 2b-8 chassis or complete vehicles with combustion engines
would be required to sell zero-emission trucks as an increasing
percentage of their annual California sales from 2024 to 2035.'' \23\
Finally, other states have signed a Memorandum of Understanding
establishing goals to increase the heavy-duty electric vehicle
market.\24\ We are proposing that further GHG reductions in the MY 2027
timeframe are appropriate considering lead time, costs, and other
factors, including these developments to zero-emission technologies in
certain segments of the heavy-duty vehicle sector. We discuss the
impacts of these factors on the heavy-duty market in Section XI. As
outlined in Section I.B and detailed in Section XI, we are proposing to
increase the stringency of the existing MY 2027 standards for many of
the vocational vehicle and tractor subcategories, specifically those
where we project early introduction of ZEVs. We are also considering
whether it would be appropriate in the final rule to increase the
stringency of the standards even more than what we propose for MYs
2027-2029, including the potential for progressively more stringent
CO<INF>2</INF> standards across these three model years. Progressively
strengthening the stringency of the standards for model years 2028 and
2029 could help smooth the transition to ambitious greenhouse gas
standards for the heavy-duty sector starting as soon as model year
2030. We believe there is information and data that could support
higher projected penetrations of HD ZEVs in the MY 2027 to 2029
timeframe and we request comment and additional supporting information
and data on higher penetration rates, which could serve as the basis
for the increase in the stringency of the CO<INF>2</INF> standards for
specific Phase 2 vehicle subcategories. For example, what information
and data are available that

[[Page 17420]]

would support HD ZEV penetration rates of 5 percent or 10 percent (or
higher) in this timeframe, and in what HD vehicle applications and
categories. We are also requesting comment on an aspect of the HD GHG
Phase 2 advanced technology incentive program.
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\23\ CARB. ``Notice of Decision: Advanced Clean Truck
Regulation.'' June 2020. Available online at: <a href="https://ww3.arb.ca.gov/regact/2019/act2019/nod.pdf">https://ww3.arb.ca.gov/regact/2019/act2019/nod.pdf</a>.
\24\ Fifteen states and one district sign Multi-State MOU.
<a href="https://www.nescaum.org/documents/multistate-truck-zev-governors-mou-20200714.pdf">https://www.nescaum.org/documents/multistate-truck-zev-governors-mou-20200714.pdf</a>.
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EPA has heard from a number of stakeholders urging EPA to put in
place policies to rapidly advance ZEVs in this current rulemaking, and
to establish standards requiring 100 percent of all new heavy-duty
vehicles be zero-emission no later than 2035. The stakeholders state
that accelerating ZEV technologies in the heavy-duty market is
necessary to prioritize environmental justice in communities that are
impacted by freight transportation and already overburdened by
pollution.\25\ One policy EPA has been asked to consider is the
establishment of a ZEV sales mandate (i.e., a nationwide requirement
for manufacturers to produce a portion of their new vehicle fleet as
ZEVs). EPA is not proposing in this action to establish a heavy-duty
ZEV mandate. EPA in this action is considering how the development and
deployment of ZEVs can further the goals of environmental protection
and best be reflected in the establishment of EPA's standards and
regulatory program for MY 2027 and later heavy-duty vehicles. As
discussed earlier in this section, EPA will also be considering the
important role of ZEV technologies in the upcoming light-duty and
medium-duty vehicle proposal for MY 2027 and later, and in the heavy-
duty vehicle proposal for MY 2030 and later. EPA requests comment under
this proposal on how the Agency can best consider the potential for ZEV
technologies to significantly reduce air pollution from the heavy-duty
vehicle sector (including but not limited to the topic of whether and
how to consider including specific sales requirements for HD ZEVs).
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\25\ Letter to EPA Administrator Michael Regan from the Moving
Forward Network. October 26, 2021.
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4. Statutory Authority for This Action
As discussed in Section I, EPA is proposing revisions to emission
standards and other requirements applicable to emissions of
NO<INF>X</INF>, PM, HC, CO, and GHG from new heavy-duty engines and
vehicles under our broad statutory authority to regulate air pollutants
emitted from mobile sources, consistent with our history of using a
multi-pollutant approach to regulating criteria pollutants and GHG
emissions from heavy-duty engines and vehicles. Section 202(a)(1) of
the Clean Air Act (CAA) requires the EPA to ``by regulation prescribe
(and from time to time revise) . . . standards applicable to the
emission of any air pollutant from any class or classes of new motor
vehicles or new motor vehicle engines . . . , which in his judgment
cause, or contribute to, air pollution which may reasonably be
anticipated to endanger public health or welfare''. Standards under CAA
section 202(a) take effect ``after such period as the Administrator
finds necessary to permit the development and application of the
requisite technology, giving appropriate consideration to the cost of
compliance within such period.'' Thus, in establishing or revising CAA
section 202(a) standards designed to reduce air pollution that
endangers public health and welfare, EPA also must consider issues of
technological feasibility, compliance cost, and lead time. EPA may
consider other factors such as safety. There are currently heavy-duty
engine and vehicle standards for emissions of NO<INF>X</INF>, PM, HC,
CO, and GHGs.
Under CAA section 202(a)(3)(A), standards for emissions of
NO<INF>X</INF>, PM, HC, and CO emissions from heavy-duty vehicles and
engines are to ``reflect the greatest degree of emission reduction
achievable through the application of technology which the
Administrator determines will be available for the model year to which
such standards apply, giving appropriate consideration to cost, energy,
and safety factors associated with the application of such
technology.'' \26\ Section 202(a)(3)(C) requires that these standards
apply for no less than 3 model years and apply no earlier than 4 years
after promulgation.
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\26\ Section 202(a)(3)(A) and (C) apply only to regulations
applicable to emissions of these four pollutants and do not apply to
regulations applicable to GHGs.
---------------------------------------------------------------------------

Emission standards set under CAA section 202(a) apply to vehicles
and engines ``for their useful life.'' CAA section 202(d) directs EPA
to prescribe regulations under which the useful life of vehicles and
engines shall be determined, and for heavy-duty vehicles and engines
establishes minimum values of 10 years or 100,000 miles, whichever
occurs first, unless EPA determines that greater values are
appropriate. CAA section 207(a) further requires manufacturers to
provide an emissions warranty, and EPA set the current warranty periods
for heavy-duty engines in 1983.\27\
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\27\ 48 FR 52170, November 16, 1983.
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As outlined in this executive summary, the proposed program would
reduce heavy-duty emissions through several major provisions pursuant
to the CAA authority described in this section. Sections I.F and XIV of
this preamble further discuss our statutory authority for this
proposal; Section I.G further describes the basis of our proposed
NO<INF>X</INF>, PM, HC, CO, and GHG emission standards and other
requirements. Section XIII describes how this proposal is also
consistent with E.O. 14037, ``Strengthening American Leadership in
Clean Cars and Trucks'' (August 5, 2021), which directs EPA to consider
taking action to establish new NO<INF>X</INF> standards for heavy-duty
engines and vehicles beginning with model year 2027.

B. Overview of the Regulatory Action

Our approach to further reduce air pollution from highway heavy-
duty engines and vehicles through the proposed program features several
key provisions. We co-propose options to address criteria pollutant
emissions from heavy-duty engines. In addition, this proposal would
make targeted updates to the existing Heavy-Duty Greenhouse Gas
Emissions Phase 2 program, proposing that further GHG reductions in the
MY 2027 timeframe are appropriate considering lead time, costs, and
other factors, including market shifts to zero-emission technologies in
certain segments of the heavy-duty vehicle sector. We also propose
limited amendments to the regulations that implement our air pollutant
emission standards for other sectors (e.g., light-duty vehicles, marine
diesel engines, locomotives, various types of nonroad engines,
vehicles, and equipment). Our proposed provisions are briefly described
in this Section I.B and summarized in Section I.C. We describe the
proposed Options 1 and 2 in detail in the Sections III, IV, and XI. We
discuss our analyses of estimated emission reductions, air quality
improvements, costs, and monetized benefits of the proposed program in
Section I.D below, and these are detailed in Sections V through X.
1. Overview of Criteria Pollutant Program
The proposed provisions to reduce criteria pollutant emissions can
be thought of in three broad categories: (1) Controlling emissions
under a broader range of engine operating conditions, (2) maintaining
emission control over a greater portion of an engine's operational
life,\28\ and (3) providing manufacturers with flexibilities to meet

[[Page 17421]]

the proposed standards while clarifying our regulations. Specifically,
provisions in the first category would include updated test procedures
and revised emission standards, while those in the second category
would include lengthened regulatory useful life and emission warranty
periods, as well as several other updates to encourage proper
maintenance and repair. These provisions would apply to heavy-duty
engines used in Class 2b through 8 vehicles.\29\ Provisions in the
third category would provide opportunities to generate NO<INF>X</INF>
emission credits that provide manufacturers with flexibilities to meet
the proposed standards and encourage the introduction of new emission
control technologies earlier than required. This category also includes
our proposal to modernize our current regulatory text, including
clarifications and updates for hybrid electric, battery-electric, and
fuel cell electric heavy-duty vehicles.
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\28\ As further discussed in Section IV.A, we use ``operational
life'' to refer to when engines are in use on the road.
\29\ EPA plans to consider new standards for chassis-certified
Class 2b and 3 vehicles (GVWR between 8,500 and 14,000 pounds) as
part of a future combined light-duty and medium-duty rulemaking
action, consistent with E.O. 14037. We are not proposing changes to
the standards or test procedures for chassis-certified heavy-duty
vehicles. Instead, this proposal focuses on engine-certified
products.
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Our discussion below focuses on the revised emission standards and
useful life and warranty periods contained in two regulatory options
that we are proposing: The proposed Option 1 and the proposed Option 2.
Although we refer to the two regulatory options as the proposed Option
1 and the proposed Option 2, we are giving full consideration to both
options, as well as the full range of options between them. Both the
proposed Option 1 and the proposed Option 2 would begin in MY 2027, but
the proposed Option 1 would have a second step in MY 2031. Overall,
proposed Option 2 is less stringent than the MY 2031 standards in the
proposed Option l because the proposed Option 2 has higher numeric
NO<INF>X</INF> emission standards and shorter useful life periods. As
discussed in Section D of this Executive Summary and Section VI, we
project proposed Option 1 would result in greater emission reductions
than proposed Option 2; Section I.G summarizes the basis of our
proposed Options 1 and 2 with details on our feasibility analysis for
each option presented in Section III. In addition to the proposed
Options 1 and 2, we present an alternative (the Alternative) that we
also considered. The Alternative is more stringent than either the
proposed Option 1 MY 2031 standards or the proposed Option 2 because
the Alternative has shorter lead time, lower numeric NO<INF>X</INF>
emission standards and longer useful life periods. We note that we
currently are unable to conclude that the Alternative is feasible in
the MY 2027 timeframe over the useful life periods in the Alternative
in light of deterioration in the emission control technologies that we
have evaluated to date, and we expect that we would need additional
supporting data or other information in order to determine that the
Alternative is feasible in the MY 2027 timeframe to consider adopting
it in the final rule.
The proposed Option 1 and proposed Option 2 generally represent the
range of regulatory options, including the standards and test
procedures, regulatory useful life and emission-related warranty
periods and implementation schedules that we are currently considering
in this rulemaking, depending in part on any additional comments and
other information we receive on the feasibility, costs, and other
impacts of the proposed Options 1 and 2. We request comment on all
aspects of the proposed Options 1 and 2, or other alternatives roughly
within the range of options covered by the proposed Options 1 and 2,
including the revised emission standards and useful life and warranty
periods, one and two-step approaches, model years of implementation and
other provisions described in this proposal. Based on currently
available information, in order to consider adopting the Alternative in
the final rule, we believe we would need additional supporting data or
other information to be able to conclude that the Alternative is
feasible in the MY 2027 timeframe. We request comment, including
relevant data and other information, related to the feasibility of the
implementation model year, numeric levels of the emission standards,
and useful life and warranty periods included in the Alternative, or
other alternatives outside the range of options covered by the proposed
Options 1 and 2.
We will continue learning about the capability and durability of
engine and aftertreatment technologies through our ongoing technology
evaluations, as well as any information provided in public comments on
this proposal. Section III describes our plans for expanding on the
analyses developed for this proposal.
2. Overview of Targeted Revisions to the HD GHG Phase 2 Program
In addition to the proposed criteria pollutant program provisions,
we are proposing to increase the stringency of the existing GHG
standards for MY 2027 trucks and requesting comment on updates to the
advanced technology incentive program for electric vehicles. We propose
updates to select MY 2027 GHG standards after consideration of the
market shifts to zero-emission technologies in certain segments of the
heavy-duty vehicle sector. These proposed GHG provisions are based on
our evaluation of the heavy-duty EV market for the MY 2024 through 2027
timeframe. While the HD Phase 2 GHG standards were developed in 2016
based on the premise that electrification of the heavy-duty market
beyond low volume demonstration projects was unlikely to occur in the
timeframe of the program, our current evaluation shows that there are a
number of manufacturers producing fully electric heavy-duty vehicles in
several applications in 2021--and this number is expected to grow in
the near term. These developments along with considerations of lead
time, costs and other factors have demonstrated that further GHG
reductions in the MY 2027 timeframe are appropriate. We expect school
buses, transit buses, delivery trucks (such as box trucks or step
vans), and short haul tractors to have the highest EV sales of all
heavy-duty vehicle types between now and 2030.\30\ We have given
careful consideration to an approach that would result in targeted
updates to reflect the emerging HD EV market without fundamentally
changing the HD GHG Phase 2 program as a whole. Thus, we are proposing
targeted updates to the HD Phase 2 GHG standards to account for the
current electrification of the market by making changes to only those
standards that are impacted by these four types of electric vehicles.
We believe this proposal considered the feasibility of technologies,
cost, lead time, emissions impact, and other relevant factors, and
therefore these standards are appropriate under CAA section 202(a). We
also are seeking comment on changes to the advanced technology credit
program since the current level of HD GHG Phase 2 incentives for
electrification may no longer be appropriate for certain segments of
the HD EV market considering the projected rise in electrification. We
provide an overview of this approach in this Section I.C and detail our
proposal in Section XI.
---------------------------------------------------------------------------

\30\ See Section XI.B for more on the growing EV market for
these four vehicle types.

---------------------------------------------------------------------------

[[Page 17422]]

C. Summary of the Major Provisions in the Regulatory Action

1. Controlling Criteria Pollutant Emissions Under a Broader Range of
Engine Operating Conditions
In the first broad category of provisions to reduce criteria
pollutant emissions in this rulemaking, we are proposing to reduce
emissions from heavy-duty engines under a range of operating conditions
through revisions to our emissions standards and test procedures. These
revisions would apply to both laboratory-based standards and test
procedures for both heavy-duty CI and SI engines, as well as the
standards and test procedures for heavy-duty CI engines on the road in
the real world.\31\
---------------------------------------------------------------------------

\31\ Duty cycle test procedures measure emissions while the
engine is operating over precisely defined duty cycles in an
emissions testing laboratory and provide very repeatable emission
measurements. ``Off-cycle'' test procedures measure emissions while
the engine is not operating on a specified duty-cycle; this testing
can be conducted while the engine is being driven on the road (e.g.,
on a package delivery route), or in an emission testing laboratory.
We may also refer to off-cycle test procedures in this preamble as
``on the road'' testing for simplicity. Both duty cycle and off-
cycle testing are conducted pre-production (e.g., for certification)
or post-production to verify that the engine meets applicable duty
cycle or off-cycle emission standards throughout useful life (See
Section III.A and IV.K for more discussion).
---------------------------------------------------------------------------

i. Proposed Laboratory Standards and Test Procedures
For heavy-duty CI engines, we are proposing new standards for
laboratory-based tests using the current duty cycles, the transient
Federal Test Procedure (FTP) and the steady-state Supplemental Emission
Test (SET) procedure. These existing test procedures require CI engine
manufacturers to demonstrate the effectiveness of emission controls
when the engine is transitioning from low-to-high loads or operating
under sustained high load, but do not provide for demonstrating
emission control under sustained low-load operations. We are proposing
that laboratory demonstrations for heavy-duty CI engines would also
include a new low-load cycle (LLC) test procedure to demonstrate that
emission controls are meeting proposed LLC standards when the engine is
operating under low-load and idle conditions. The proposed addition of
the LLC would help ensure lower NO<INF>X</INF> emissions in urban areas
and other locations where heavy-duty vehicles operate in stop-and-go
traffic or other low-load conditions.
For heavy-duty SI engines, we are proposing new standards for their
laboratory demonstrations using the current FTP duty cycle, and updates
to the current engine mapping procedure to ensure the engines achieve
the highest torque level possible during testing. We are proposing to
add the SET procedure to the heavy-duty SI laboratory demonstrations;
it is currently only required for heavy-duty CI engines. Heavy-duty SI
engines are increasingly used in larger heavy-duty vehicles, which
makes it more likely for these engines to be used in higher-load
operations covered by the SET. We are further proposing a new refueling
emission standard for incomplete vehicles above 14,000 lb GVWR starting
in MY 2027.\32\ The proposed refueling standard is based on the current
refueling standard that applies to complete heavy-duty gasoline-fueled
vehicles. Consistent with the current evaporative emission standards
that apply for these same vehicles, we are proposing that manufacturers
could use an engineering analysis to demonstrate that they meet our
proposed refueling standard.
---------------------------------------------------------------------------

\32\ Some vehicle manufactures sell their engines or
``incomplete vehicles'' (i.e., chassis that include their engines,
the frame, and a transmission) to body builders who design and
assemble the final vehicle.
---------------------------------------------------------------------------

Our proposed Option 1 and proposed Option 2 NO<INF>X</INF> emission
standards for all defined duty cycles for heavy-duty CI and SI engines
are detailed in Table 1. As shown, the proposed Option 1 NO<INF>X</INF>
standards would be implemented in two steps beginning with MY 2027 and
becoming more stringent in MY 2031. The proposed Option 2
NO<INF>X</INF> emission standards would be implemented with a single
step in MY 2027. As noted in Section B.1 of this Executive Summary,
overall, we consider proposed Option 2 to be less stringent than the
standards in the proposed Option 1 because proposed Option 2 has higher
numeric NO<INF>X</INF> emission standards with similar useful life
periods as the proposed Option 1 in MY 2027, and shorter length of
useful life periods than the proposed Option 1 in MY 2031. In contrast,
the Alternative is more stringent than proposed Option 1's MY 2031
standards (see Section III), and we currently do not have information
to support the conclusion that the combination of shorter lead time,
lower numeric levels of the standards and longer useful life periods in
the Alternative is feasible in the MY 2027 timeframe based on the
emission control technologies we have evaluated to date. See Section
III for more discussion on feasibility. Consistent with our current
approach for criteria pollutants, the standards in proposed Options 1
and 2, presented in Table 1, are numerically identical for SI and CI
engines.\33\
---------------------------------------------------------------------------

\33\ See Section III for our proposed and alternative PM, HC,
and CO standards.

Table 1--Proposed Options 1 and 2 NOX Emission Standards for Heavy-Duty CI and SI Engines on Specific Duty
Cycles
[Milligrams/horsepower-hour (mg/hp-hr)] \a\
----------------------------------------------------------------------------------------------------------------
Proposed Option 1 Proposed
---------------------------------------------------------------- Option 2
Model years Model years 2031 and later ---------------
2027-2030 ------------------------------------------------ Model years
---------------- 2027 and later
Duty cycle Spark ignition Heavy HDE Heavy HDE from ---------------
HDE, light through IUL to full Spark ignition
All HD engines HDE, and intermediate useful life HDE, light
medium HDE useful life (FUL) HDE, medium
(IUL) HDE, heavy HDE
----------------------------------------------------------------------------------------------------------------
FTP (transient mid/high load 35 20 20 40 50
conditions)....................
SET (steady-state conditions)... 35 20 20 40 50
LLC (low-load conditions)....... 90 50 50 100 100
----------------------------------------------------------------------------------------------------------------
\a\ The current FTP and SET standard for all HD engines is 0.20 g/hp-hr or 200 mg/hp-hr; we are proposing the
LLC test procedure and therefore there is not a current standard for the LLC.

[[Page 17423]]

ii. Proposed On-the-Road Standards and Test Procedures
In addition to demonstrating emission control over defined duty
cycles in a laboratory, heavy-duty CI engines must be able to
demonstrate emission control over an undefined duty cycle while engines
are in use on the road in the real world. Both proposed Options 1 and 2
include updates to the procedure for ``off-cycle'' testing, such that
data collected during a wider range of operating conditions would be
valid, and therefore subject to emission standards.\34\
---------------------------------------------------------------------------

\34\ As discussed in Section III, ``off-cycle'' testing measures
emissions while the engine is not operating on a specified duty-
cycle; this testing can be conducted while the engine is being
driven on the road (e.g., on a package delivery route), or in an
emission testing laboratory.
---------------------------------------------------------------------------

Similar to the current approach, emission measurements collected
during off-cycle testing would be collected on a second-by-second
basis. We are proposing the emissions data would be grouped into 300-
second windows of operation. Each 300-second window would then be
binned based on the type of operation that the engine performs during
that 300-second period. Specifically, the average power of the engine
during each 300-second window would determine whether the emissions
during that window are binned as idle (Bin 1), low-load (Bin 2), or
medium-to-high load (Bin 3).\35\
---------------------------------------------------------------------------

\35\ Due to the challenges of measuring engine power directly on
in-use vehicles, we are proposing to use the CO<INF>2</INF> emission
rate (grams per second) as a surrogate for engine power; further, we
propose to normalize CO<INF>2</INF> emission rates relative to the
nominal maximum CO<INF>2</INF> rate of the engine (e.g., when an
engine with a maximum CO<INF>2</INF> emission rate of 50 g/sec emits
at a rate of 10 g/sec, its normalized CO<INF>2</INF> emission rate
is 20 percent).
---------------------------------------------------------------------------

Our proposed 3-bin approach would cover a wide range of operations
that occur in the real world--significantly more in-use operation than
today's requirements. Bin 1 would include extended idle and other very
low-load operations, where engine exhaust temperatures may drop below
the optimal temperature where SCR-based aftertreatment works best. Bin
2 would include a large fraction of urban driving conditions, during
which engine exhaust temperatures are generally moderate. Bin 3 would
include higher-power operations, such as on-highway driving that
typically results in higher exhaust temperatures and high catalyst
efficiencies.\36\ Given the different operational profiles of each of
these three bins, we are proposing a separate standard for each bin.
The proposed structure follows that of our current not-to-exceed (NTE)
off-cycle standards, while covering a much broader range of engine
operation.
---------------------------------------------------------------------------

\36\ Because the proposed approach considers time-averaged
power, any of the bins could include some idle operation and any of
the bins could include some high-power operation.
---------------------------------------------------------------------------

Table 2 presents our proposed Option 1 and Option 2 off-cycle
standards for NO<INF>X</INF> emissions from heavy-duty CI engines. The
proposed Option 2 off-cycle NO<INF>X</INF> standards are higher (less
stringent) and have a shorter useful life than the proposed Option 1
standards in MY 2031. For the Alternative, our assessment of currently
available data indicates that the off-cycle standard for the medium/
high load bin (Bin 3) would not be feasible in the MY 2027 timeframe,
and additional or different technology would be necessary to meet the
Alternative off-cycle standards. See Section III for details on the
off-cycle standards for other pollutants in the proposed Options 1 and
2 and the Alternative.

Table 2--Proposed Options 1 and 2 Off-Cycle NOX Standards for Heavy-Duty CI Engines
----------------------------------------------------------------------------------------------------------------
Proposed Option 1 Proposed
---------------------------------------------------------------- Option 2
Model years Model years 2031 and later ---------------
Operation bin 2027-2030 ------------------------------------------------ Model years
---------------- 2027 and later
Light HDE, and Heavy HDE Heavy HDE from ---------------
All HD engines medium HDE through IUL IUL to FUL All HD engines
----------------------------------------------------------------------------------------------------------------
idle (g/hr)..................... 10 7.5 7.5 7.5 15
low load (mg/hp-hr)............. 180 75 7.5 150 150
medium/high load (mg/hp-hr)..... 70 30 30 60 75
----------------------------------------------------------------------------------------------------------------

In addition to the proposed standards for the defined duty cycle
and off-cycle test procedures, the proposed Options 1 and 2 include
several other provisions for controlling emissions from specific
operations in CI or SI engines. First, we are proposing to allow CI
engine manufacturers to voluntarily certify to the California Air
Resources Board (CARB) clean idle standards by adding to EPA
regulations an idle test procedure that is based on an existing CARB
procedure.\37\ We are also proposing to require a closed crankcase
ventilation system for all highway CI engines to prevent crankcase
emissions from being emitted directly to the atmosphere. See Section
III.B for more discussion on both the proposed idle and crankcase
provisions. For heavy-duty SI, we are proposing refueling emission
standards for incomplete vehicles above 14,000 lb GVWR (see Section
III.E for more discussion).
---------------------------------------------------------------------------

\37\ 13 CCR 1956.8 (a)(6)(C)--Optional NO<INF>X</INF> idling
emission standard.
---------------------------------------------------------------------------

2. Maintaining Criteria Pollutant Emission Control Over a Greater
Portion of an Engine's Operational Life
Reducing emissions under a broad range of engine operating
conditions is one category of our proposed program provisions.
Maintaining emission control over a greater portion of an engine's
operational life is the second broad category of proposed provisions.
The major elements in this category include proposals to (1) extend the
regulatory useful life of heavy-duty engines, (2) provide an
opportunity for manufacturers to use rapidly aged parts necessary to
demonstrate emission performance over the regulatory useful life, (3)
lengthen emission warranty periods, and 4) increase the likelihood that
emission controls will be maintained properly through more of the
service life of heavy-duty engines. Our proposals for each of these
elements is outlined below and detailed in Section IV; unless
explicitly stated otherwise, proposals for each of these elements would
apply under both proposed Options 1 and 2, as well as the full range of
options in between them.
i. Proposed Useful Life Periods
EPA is proposing to increase the regulatory useful life mileage
values for new heavy-duty engines to better reflect real-world usage,
extend the emissions durability requirement for heavy-duty engines, and
ensure certified emission performance is maintained throughout

[[Page 17424]]

more of an engine's operational life. For proposed Option 1, Increases
to useful life values for heavy-duty engines would apply in two steps,
as discussed in Section IV.A. For the first step for CI engines, MY
2027 through 2030, we are proposing useful life mileage values that are
approximately a midpoint between the current useful life mileages and
our proposed CI engines MY 2031 and later mileages. For the second
step, we are proposing useful life mileage values for MY 2031 and later
CI engines that cover a majority of the estimated operational life
mileages, but less than the first out-of-frame rebuild for these
engines. The proposed Option 1 first step for SI engines in MY 2027
through 2030 would better align with the current useful life mileages
for GHG emission standards applicable to these engines. The proposed
Option 1 second step useful life mileage for SI engines for MY 2031 and
later is based on the published engine service life for heavy-duty
gasoline engines in the market today.
The useful life mileages in the proposed Option 2 are shorter than
those in the proposed Option 1; we are giving full consideration to the
useful life periods of proposed Options 1 and 2, and the range between
the useful life periods in the proposed Options. Our proposed Option 1
and Option 2 useful life periods for heavy-duty CI and SI engines are
presented in Table 3. See Section IV for the useful periods of the
Alternative.\38\
---------------------------------------------------------------------------

\38\ As noted in this Section C of the Executive Summary, we are
proposing refueling standards for HD SI engines that are certified
as incomplete vehicles that are equivalent to the standards in
effect for complete heavy-duty vehicles. We propose to apply the
existing useful life periods for the complete vehicle refueling
standards (15 years or 150,000 miles; see 40 CFR 1037.103(f) and
86.1805-16(d) for ``MDPV'' and ``HDV'') to the HD SI engines
certified as incomplete vehicles. See preamble Section IV.A for more
details.

Table 3--Proposed Options 1 and 2 Useful Life Periods for Heavy-Duty CI and SI Engines Criteria Pollutant Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
Spark-ignition HDE Compression-ignition
---------------------------------------------------------------------------------------
Model year Light HDE Medium HDE Heavy HDE b c
Miles Years -----------------------------------------------------------------
Miles Years Miles Years Miles Years
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current \a\..................................................... 110,000 10 110,000 10 185,000 10 435,000 10
Proposed Option 1: 2027-2030.................................... 155,000 12 190,000 12 270,000 11 600,000 11
Proposed Option 1 \d\: 2031 and later........................... 200,000 15 270,000 15 350,000 12 800,000 12
Proposed Option 2: 2027 and later............................... 150,000 10 250,000 10 325,000 10 650,000 10
--------------------------------------------------------------------------------------------------------------------------------------------------------
\a\ Current useful life period for Spark-ignition HDE and Light HDE for GHG emission standards is 15 years or 150,000 miles. See 40 CFR 1036.108(d).
\b\ We are also proposing to increase the hours-based useful life criterion from the current 22,000 hours for Heavy HDE to 32,000 hours for model years
2027-2030 and 40,000 hours for model years 2031 and later.
\c\ The Heavy HDE class includes certain SI engines (e.g., natural gas-fueled engines) intended for use in Class 8 vehicles.
\d\ For MY 2031 and later Heavy HDE, the proposed Option 1 would include intermediate useful life periods of 435,000 miles, 10 years, or 22,000 hours,
whichever comes first. See Section III for a discussion of the proposed Option 1 standards we propose to apply for the intermediate and full useful
life periods.

ii. Proposed Durability Demonstration Updates
The proposed longer useful life periods outlined in Table 3 would
require manufacturers to extend their durability demonstrations, which
show that the engines will meet applicable emission standards
throughout their regulatory useful life. EPA regulations require
manufacturers to include durability demonstration data as part of an
application for certification of an engine family. Manufacturers
typically complete this demonstration by following regulatory
procedures to calculate a deterioration factor (DF).
To address the need for accurate and efficient emission durability
demonstration methods, EPA worked with manufacturers and CARB to
address this concern through guidance for MY 2020 and later
engines.\39\ In Section IV.F, we propose three methods for determining
DFs, consistent with the recent guidance, including a new option to
bench-age the aftertreatment system to limit the burden of generating a
DF over the proposed lengthened useful life periods. We also propose to
codify in the EPA regulations three DF verification options available
to manufacturers in recent guidance. The proposed verification options
would confirm the accuracy of the DF values submitted by manufacturers
for certification. We also introduce a test program to evaluate a
rapid-aging protocol for diesel catalysts that we may consider as an
option for CI engine manufacturers to use in their durability
demonstration.
---------------------------------------------------------------------------

\39\ U.S. EPA. ``Guidance on Deterioration Factor Validation
Methods for Heavy-Duty Diesel Highway Engines and Nonroad Diesel
Engines equipped with SCR.'' CD-2020-19 (HD Highway and Nonroad).
November 17, 2020.
---------------------------------------------------------------------------

iii. Proposed Emissions Warranty Periods
EPA's current emission-related warranty periods range from 22
percent to 54 percent of regulatory useful life. As EPA is proposing to
lengthen the useful life periods in this rulemaking, we are also
proposing to lengthen the emission warranty periods and increase the
fraction of useful life miles covered under warranty. These proposed
revised warranty periods are expected to result in better engine
maintenance and less tampering, helping to maintain the benefits of the
emission controls. In addition, longer regulatory warranty periods may
lead engine manufacturers to simplify repair processes and make them
more aware of system defects that would be tracked and reported to EPA
over a longer period.
In Section IV.B, we provide detailed discussion and request comment
on these four ways that longer emission warranty periods may enhance
long-term performance of emission-related devices and systems. We also
discuss other impacts of lengthening regulatory emission warranty
periods and other approaches that vary coverage and may similarly
ensure long-term in-use emission performance.
EPA is proposing to lengthen the emissions warranty periods for all
primary intended service classes to cover a larger portion of the
operational lives of new heavy-duty engines. Our proposed Option 1
warranty mileages for MY 2031 are approximately 80 percent of the
proposed useful life mileages. The proposed Option 1 MY 2027 through
2030 mileages are

[[Page 17425]]

approximately midpoints between the current and proposed Option 1 MY
2031 and later mileages. The proposed Option 2 set of emission warranty
periods would match CARB's Step 1 warranty periods that will already be
in effect beginning in model year 2022 for engines sold in
California.\40\ We believe the proposed Option 2 mileages represent an
appropriate lower end of the range we are considering for the revised
regulatory emission warranty periods. Our proposed Option 1 and
proposed Option 2 emission warranty periods are presented in Table
4.\41\ See Section IV.B for updates in proposed Options 1 and 2 to our
years-based warranty periods and add hours-based warranty periods for
all engine classes to cover low average annual mileage applications. We
also considered an alternative set of warranty periods that are
presented in Section IV.B.
---------------------------------------------------------------------------

\40\ For SI engines, the Alternative 1 warranty mileage matches
the current useful life, consistent with the approach for Light HDE
Alternative 1 warranty.
\41\ In addition to exhaust standards, we are proposing
refueling standards for HD SI engines that are certified as
incomplete vehicles. The onboard refueling vapor recovery systems
necessary to meet the proposed refueling standards will likely build
on existing evaporative emissions systems, and we propose to apply
the existing warranty periods for evaporative emission control
systems to the ORVR systems (5 years or 50,000 miles). See Preamble
IV.B.1.

Table 4--Proposed Options 1 and 2 Emission-Related Warranty Periods for Heavy-Duty CI and SI Engines Criteria Pollutant Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
Spark-ignition HDE Compression-ignition
----------------------------------------------------------------------------------------
Model year Light HDE Medium HDE Heavy HDE Years
Miles Hours ------------------------------------------------------------------
Miles Hours Miles Hours Miles Hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current................................................ 50,000 NA 50,000 NA 100,000 NA 100,000 NA 5
Proposed Option 1: 2027-2030........................... 110,000 6,000 150,000 7,000 220,000 11,000 450,000 22,000 7
Proposed Option 1: 2031 and later...................... 160,000 8,000 210,000 10,000 280,000 14,000 600,000 30,000 10
Proposed Option 2: 2027 and later...................... 110,000 NA 110,000 NA 150,000 NA 350,000 NA 5
--------------------------------------------------------------------------------------------------------------------------------------------------------

iv. Proposed Provisions To Ensure Long-Term Emissions Performance
In the ANPR, we introduced several ideas for an enhanced,
comprehensive strategy to increase the likelihood that emission
controls will be maintained properly through more of the operational
life of heavy-duty engines, including beyond their useful life periods.
Our proposed updates to maintenance provisions include defining the
type of maintenance manufacturers may choose to recommend to owners in
maintenance instructions, updating minimum maintenance intervals for
certain critical emission-related components, and outlining specific
requirements for maintenance instructions provided in the owner's
manual.
We are proposing changes to the owner's manual and emissions label
requirements to ensure access to certain maintenance information and
improve serviceability. We expect this additional maintenance
information to improve factors that contribute to mal-maintenance,
which would result in better service experiences for independent repair
technicians, specialized repair technicians, owners who repair their
own equipment, and possibly vehicle inspection and maintenance
technicians. We also believe that improving owner experiences with
operating and maintaining heavy-duty engines can reduce the likelihood
of tampering.
v. Proposed Inducement Provisions
ANPR commenters indicated that engine derates or ``inducements''
are a significant source of operator frustration.\42\ EPA currently has
guidance on potential options manufacturers might utilize to meet
existing requirements through an inducement strategy for their SCR-
based aftertreatment system.\43\ We are proposing to codify inducement
provisions after considering manufacturer designs and operator
experiences with SCR-based aftertreatment systems. In Section IV.D, we
present the key principles we followed in developing the proposed
inducement provisions, which includes a focus on conditions that are
within an operator's control, a multi-step derate schedule, and a
backup check to override false inducements. We also include a detailed
set of requests for comment highlighting the wide range of adjustments
we are currently considering.
---------------------------------------------------------------------------

\42\ Engine derating is an aftertreatment design strategy that
reduces engine performance to induce operators to maintain
appropriate levels of high-quality diesel emission fluid (DEF) in
their SCR-based aftertreatment systems. Throughout this preamble we
refer to engine derates that derive from DEF-related triggers as
``inducements.''
\43\ Kopin, Amy. Memorandum to docket EPA-HQ-OAR-2019-0055.
``Inducement-Related Guidance Documents, and Workshop
Presentation.'' October 1, 2021.
---------------------------------------------------------------------------

vi. Proposed Onboard Diagnostics Provisions
Onboard diagnostics (OBD) refer to systems of electronic
controllers and sensors required by current regulation to detect
malfunctions of engines and emission controls. EPA's existing OBD
program, promulgated in 2009, allows manufacturers to demonstrate how
the OBD system they have designed to comply with California OBD
requirements also complies with the intent of the EPA OBD
requirements.\44\ Although EPA maintains separate OBD regulations, all
manufacturers currently seek OBD approval from CARB for OBD systems in
engine families applying for 50-state certification, and then use this
approval to demonstrate compliance with EPA requirements.
---------------------------------------------------------------------------

\44\ See 40 CFR 86.010-18(a)(5).
---------------------------------------------------------------------------

In Section IV.C, we are proposing to update our OBD regulations
both to better address newer diagnostic methods and available
technologies, and to streamline provisions where possible. We propose
to incorporate by reference the existing CARB OBD regulations updated
in 2019 as the starting point for our updated OBD regulations.\45\ We
are proposing to exclude or revise certain CARB provisions that we
believe are not appropriate for a federal program and are proposing to
include additional elements to improve the usefulness of

[[Page 17426]]

OBD systems for users (see Section IV.C for details).
---------------------------------------------------------------------------

\45\ CARB Final Rulemaking to Consider Technical Status and
Prosed Revisions to On-Board Diagnostic System Requirements for
Heavy-Engines, Passenger Cars, Light-Duty Trucks, Medium Duty
Vehicles and Engines was approved and became effective on July 31,
2013. California Code of Regulations sections 1968.2 and 1971.1
available at: <a href="https://ww3.arb.ca.gov/regact/2012/hdobd12/hdobd12.htm">https://ww3.arb.ca.gov/regact/2012/hdobd12/hdobd12.htm</a>.
---------------------------------------------------------------------------

EPA is specifically proposing additional OBD elements to improve
the robustness and usefulness of OBD systems. These additional elements
include emission system health monitors, an expanded list of publicly
available OBD parameters, additional freeze frame data parameters, and
enabling certain self-testing capabilities for owners. These proposed
changes would benefit the environment by helping to reduce
malfunctioning emission systems in-use through access to additional
data that may be useful for service technicians, state and local
inspection and maintenance operations, and owners.
3. Other Proposed Compliance Provisions and Flexibilities
In addition to the key program provisions, we are also proposing
several provisions to provide manufacturers with flexibility to meet
the proposed standards and encourage the introduction of new emission
control technologies earlier than required; these provisions would
apply under both proposed Options 1 and 2, as well as the full range of
options in between them. These provisions include our proposal to
migrate and update the compliance provisions of 40 CFR part 86, subpart
A, to 40 CFR part 1036; continue averaging, banking, and trading (ABT)
of credits generated against our heavy-duty engine criteria pollutant
standards; provide incentives for early adoption of technologies to
meet the standards; allow manufacturers to generate NO<INF>X</INF>
emission credits for hybrid electric, battery electric, and fuel cell
electric vehicles (HEVs, BEVs, and FCEVs); and make limited amendments
to regulations that implement our air pollutant emission standards for
other industry sectors, including light-duty vehicles, light-duty
trucks, marine diesel engines, locomotives, and various types of
nonroad engines, vehicles, and equipment.
i. Proposed Migration From 40 CFR Part 86, Subpart A
Heavy-duty criteria pollutant regulations were originally codified
into 40 CFR part 86, subpart A, in the 1980s. We believe this
rulemaking provides an opportunity to clarify (and otherwise improve)
the wording of our existing heavy-duty criteria pollutant regulations
in plain language and migrate them to 40 CFR part 1036.\46\ Part 1036,
which was created for the Phase 1 GHG program, provides a consistent,
updated format for our regulations, with improved organization. In
general, this migration is not intended to change the compliance
program previously specified in part 86, except as specifically
proposed in this rulemaking. See our summary of the proposed migration
in Section III.A, and additional details in our memorandum to the
docket.\47\ The proposed provisions of part 1036 would generally apply
for model years 2027 and later, unless noted, and manufacturers would
continue to use part 86 in the interim.
---------------------------------------------------------------------------

\46\ We are proposing to migrate some provisions to parts 1065
and 1068 to apply broadly to other sectors. Additionally, some
current vehicle provisions in part 1037 refer to part 86 and we are
proposing to update those references in part 1037 as needed.
\47\ Stout, Alan; Brakora, Jessica. Memorandum to docket EPA-HQ-
OAR-2019-0055. ``Technical Issues Related to Migrating Heavy-Duty
Highway Engine Certification Requirements from 40 CFR part 86,
subpart A, to 40 CFR part 1036''. October 1, 2021.
---------------------------------------------------------------------------

ii. Proposed Opportunities for NO<INF>X</INF> Emission Credits
We are proposing targeted revisions to the current emissions ABT
provisions to account for specific aspects of the broader proposed
program. We are also proposing an early adoption incentive program that
would recognize the environmental benefits of lower-emitting vehicles
entering the fleet ahead of required compliance dates for the proposed
standards. Through this optional program, manufacturers who demonstrate
early compliance with the proposed MY 2027 or MY 2031 standards would
apply a multiplier to emission credits generated under the proposed ABT
program (see Section IV.H for details). We are also proposing to offer
NO<INF>X</INF> emission credits for HEVs, BEVs and FCEVs based on the
near-zero or zero-tailpipe emissions performance of these technologies,
for HEVs or BEVs and FCEVs, respectively, and after consideration of
ANPR comments. We are choosing not to propose emission credit
multipliers for HEVs, BEVs, and FCEVs. We believe that the potential
loss of emission reductions that could result from providing credit
multipliers is not justified in light of the current extent of
technology development and implementation. Manufacturers choosing to
generate NO<INF>X</INF> emission credits from BEVs or FCEVs would need
to conduct testing and meet durability requirements discussed in
Section IV.
iii. Other Amendments
EPA has promulgated emission standards for highway and nonroad
engines, vehicles, and equipment. Section XII of this proposed rule
describes several amendments to correct, clarify, and streamline a wide
range of regulatory provisions for many of those different types of
engines, vehicles, and equipment. Section XII.A includes technical
amendments to compliance provisions that apply broadly across EPA's
emission control programs to multiple industry sectors, including
light-duty vehicles, light-duty trucks, marine diesel engines,
locomotives, and various other types of nonroad engines, vehicles, and
equipment. Some of those amendments are for broadly applicable testing
and compliance provisions in 40 CFR parts 1065, 1066, and 1068. Other
cross-sector issues involve making the same or similar changes in
multiple standard-setting parts for individual industry sectors. The
rest of Section XII describes proposed amendments that apply uniquely
for individual industry sectors.
We are proposing amendments in two areas of note for the general
compliance provisions in 40 CFR part 1068. First, we are proposing to
take a comprehensive approach for making confidentiality determinations
related to compliance information that companies submit to EPA. We are
proposing to apply these provisions for all highway, nonroad, and
stationary engine, vehicle, and equipment programs, as well as aircraft
and portable fuel containers.
Second, we are proposing provisions that include clarifying text to
establish what qualifies as an adjustable parameter and to identify the
practically adjustable range for those adjustable parameters. The
proposed adjustable-parameter amendments also include specific
provisions related to electronic controls that aim to deter tampering.
4. Targeted Revisions to the HD GHG Phase 2 Program
As noted at the start of this Section I.B, we have developed a
proposed approach to make targeted updates that take into consideration
the growing HD electric vehicle market without fundamentally changing
the HD GHG Phase 2 program as a whole. These developments along with
considerations of lead time, costs and other factors have demonstrated
that further GHG reductions in the MY 2027 timeframe are appropriate.
Specifically, we propose to adjust the HD GHG Phase 2 vehicle GHG
emission standards by sales-weighting the projected heavy-duty EV
production levels of school buses, transit buses, commercial delivery
trucks, and short-haul tractors and by lowering the applicable emission
standards in MY 2027 accordingly. We project these four vehicle types
will have the highest EV sales of all heavy-

[[Page 17427]]

duty vehicle types between now and 2030. Because these four EV vehicle
types do not correspond directly with the specific subcategories for
standards that we developed in HD GHG Phase 2 (subcategories
differentiated by vehicle weight, use, fuel type, etc.), we use EPA
certification data to determine which subcategories of standards would
be impacted by EV production in MY 2027. By sales-weighing the
projected production levels of the four EV vehicle types in 2027, our
proposed approach adjusts 17 of the 33 MY 2027 Phase 2 vocational
vehicle and tractor standards and does not change any MY 2021 or MY
2024 standards or any of the Class 2b/3 pickup truck and van standards.
We request comment on the proposed approach to determine the threshold.
In addition to these proposed standard adjustments, we are
requesting comment on options to update the advanced technology
incentive program for electric and plug-in hybrid vehicles beginning in
MY 2024. These changes may be appropriate to reflect that such levels
of incentives for electrification may no longer be appropriate for
certain segments of the HD EV market. We are trying to balance
providing additional incentives for the continued development of zero
and near-zero emission vehicles without inadvertently undermining the
GHG emission reductions from the HD GHG Phase 2 program with
inappropriate incentives.

D. Projected Emission Reductions, Air Quality Improvements, Costs, and
Benefits

Our analysis of the estimated emission reductions, air quality
improvements, costs, and monetized benefits of the proposed criteria
pollutant program is outlined below and detailed in Sections V through
X. While the discussion below generally focuses on our analysis of the
proposed Option 1, we also discuss the proposed Option 2; additional
information on analyses of proposed Options 1 and 2 is included in the
sections that follow. As discussed in Section III, we currently lack
information to show that the Alternative is feasible in the MY 2027
timeframe based on the emission control technologies that we have
evaluated to date, and therefore we are not presenting an analysis of
the costs or benefits of the Alternative. We expect that we would need
additional data supporting the feasibility of the Alternative to
further consider it in the development of the final rule.
The proposed provisions in Options 1 and 2, which are described in
detail in Sections III and IV, are expected to reduce emissions from
highway heavy-duty engines in several ways. We project the proposed
emission standards for heavy-duty CI engines would reduce tailpipe
emissions of NO<INF>X</INF>; the combination of the proposed low-load
test cycle and off-cycle test procedure for CI engines would help to
ensure that the reductions in tailpipe emissions are achieved in-use,
not only under high-speed, on-highway conditions, but also under low-
load and idle conditions. We also project reduced tailpipe emissions of
NO<INF>X</INF>, CO, PM, VOCs, associated air toxics, and methane from
the proposed emission standards for heavy-duty SI engines, particularly
under cold-start and high-load operating conditions. The longer
emission warranty and regulatory useful life requirements for heavy-
duty CI and SI engines in the proposed Options 1 and 2 would help
maintain the expected emission reductions for all pollutants, including
primary exhaust PM<INF>2.5</INF>, throughout the useful life of the
engine. The onboard refueling vapor recovery requirements for heavy-
duty SI engines in the proposed Options 1 and 2 would reduce VOCs and
associated air toxics. Table 5 summarizes the projected reductions in
heavy-duty emission from the proposed Options 1 and 2 in 2045 and shows
the significant reductions in NO<INF>X</INF> emissions from the
proposal. In general, we estimate that Option 2 would result in lower
emission reductions because of the less stringent emission standards
combined with shorter useful life and warranty periods than the
proposed Option 1 in MY 2031. Section VI and draft Regulatory Impact
Analysis (RIA) Chapter 5 provide more information on our projected
emission reductions for proposed Options 1 and 2, as well as the
Alternative.

Table 5--Projected Heavy--Duty Emission Reductions in 2045 From the
Proposed Options 1 and 2 Standards
------------------------------------------------------------------------
Percent reduction in
highway heavy-duty
emissions
Pollutant -------------------------
Proposed Proposed
Option 1 Option 2
------------------------------------------------------------------------
NOX........................................... 61 47
Primary PM2.5................................. 26 24
VOC........................................... 21 20
CO............................................ 17 16
------------------------------------------------------------------------

The proposed criteria pollutant program in proposed Options 1 and 2
would also reduce emissions of other pollutants. For instance, the
proposed Option 1 would result in a 27 percent reduction in benzene and
a 0.7 percent reduction in methane from highway heavy-duty engines in
2045. Leading up to 2045, emission reductions are expected to increase
over time as the fleet turns over to new, compliant engines.
Reductions in emissions of NO<INF>X</INF>, VOC, PM<INF>2.5</INF>,
and CO from the proposed rule are projected to lead to decreases in
ambient concentrations of ozone, PM<INF>2.5</INF>, NO<INF>2</INF>, and
CO. The proposed Option 1 standards would significantly decrease ozone
concentrations across the country, with a population-weighted average
decrease of over 2 ppb in 2045.\48\ Ambient PM<INF>2.5</INF>,
NO<INF>2</INF> and CO concentrations are also predicted to improve in
2045 as a result of the proposed Option 1 program. The emission
reductions provided by the proposed standards would be important in
helping areas attain the NAAQS and prevent future nonattainment. In
addition, the proposed Option 1 standards are expected to result in
improvements in nitrogen deposition and visibility, but they are
predicted to have relatively little impact on ambient concentrations of
air toxics.
---------------------------------------------------------------------------

\48\ Due to resource constraints, we only conducted air quality
modeling for the proposed Option 1.
---------------------------------------------------------------------------

We also used our air quality data from modeling Option 1 to conduct
a demographic analysis of human exposure to future air quality in
scenarios with and without the proposed criteria pollutant standards in
place. To compare demographic trends, we sorted 2045 baseline air
quality concentrations from highest to lowest concentration and created
two groups: Areas within the contiguous U.S. with the worst air quality
and the rest of the country. We found that in the 2045 baseline, the
number of people of color living within areas with the worst air
quality is nearly double that of non-Hispanic Whites. We also found
that the largest predicted improvements in both ozone and
PM<INF>2.5</INF> are estimated to occur in areas with the worst
baseline air quality, where larger numbers of people of color are
projected to reside. More details on our air quality modeling and
demographic analyses are included in Section VII and draft RIA Chapter
6.
Our estimates of reductions in heavy-duty engine emissions, and
associated air quality impacts, are based on manufacturers adding
emissions-reduction technologies in response to the proposed Options 1
or 2 criteria pollutant standards, along with making emission control
components more durable in response to the longer regulatory useful
life periods in the proposed Options 1 or 2. We also estimate costs to
both truck owners and manufacturers attributable to the longer emission
warranty for both the proposed Options 1 and 2. We estimate costs of

[[Page 17428]]

the proposed Options 1 and 2 to both manufacturers and truck owners in
our program cost analysis in Section V and draft RIA Chapter 7.
Our evaluation of costs to manufacturers includes direct costs
(i.e., cost of materials, labor costs) and indirect manufacturing costs
(e.g., warranty, research and development). The direct manufacturing
costs include individual technology costs for emission-related engine
components and for exhaust aftertreatment systems. Importantly, our
analysis of direct manufacturing costs includes the costs of the
existing emission control technologies because we expect the emissions
warranty and regulatory useful life provisions in the proposed Options
1 and 2 to have some impact on not only the new technology added to
comply with the proposed standards, but also on any existing emission
control components. The cost estimates thus reflect the portion of
baseline case engine hardware and aftertreatment systems for which new
costs would be incurred due to the proposed warranty and useful life
provisions, even absent any changes in the level of emission standards.
The indirect manufacturing costs in our analysis include warranty
costs, research and development costs, profits and other indirect
costs. We combine direct and indirect manufacturing costs to calculate
total technology costs, which we then add to operating costs in our
calculation of program costs.
As part of our evaluation of operating costs, we estimate costs
truck owners incur to repair emission control system components. Our
repair cost estimates are based on industry data showing the amount
spent annually by truck owners on different types of repairs, and our
estimate of the percentage of those repairs that are related to
emission control components. Our analysis of this data shows that
extending the useful life and emission warranty periods would lower
emission repair costs during several years of operation for several
vehicle types. More discussion on our emission repair costs estimates
of the proposed Options 1 and 2 criteria pollutant standards is
included in Section V, with additional details presented in draft RIA
Chapter 7.
We combined our estimates of emission repair costs with other
operating costs (i.e., urea/DEF, fuel consumption) and technology costs
to calculate total program costs. Our analysis of proposed Option 1
shows that total costs for the criteria pollutant program relative to
the baseline (or no action scenario) range from $1.8 billion in 2027 to
$2.3 billion in 2045 (2017 dollars, undiscounted, see Table V-16). We
estimate that proposed Option 2 would result in higher costs than the
proposed Option 1 in 2045. We expect that the same emission control
technologies would be needed to meet both the proposed Option 1 and 2
standards, which would result in the same direct technology costs in
both cases. The higher projected costs of the proposed Option 2
relative to the proposed Option 1 result from our expectation that the
shorter useful life and emission warranty periods of the proposed
Option 2 compared to proposed Option 1 in MY 2031 and later would lead
to higher emission control system repair costs for proposed Option 2
than the proposed Option 1 (i.e., shorter emissions warranty periods
result in higher emission repair costs in proposed Option 2) (see
Section V for details). Overall, the analysis shows that the costs of
proposed Option 1 are less than the costs of proposed Option 2. The
present value of program costs for proposed Options 1 and 2, and
additional details are presented in Section V.
Section VIII presents our analysis of the human health benefits
associated with the proposed Options 1 and 2. We estimate that in 2045,
the proposed Option 1 would result in total annual monetized ozone- and
PM<INF>2.5</INF>-related benefits of $12 and $33 billion at a 3 percent
discount rate, and $10 and $30 billion at a 7 percent discount
rate.\49\ In the same calendar year, proposed Option 2 would result in
total annual monetized ozone- and PM<INF>2.5</INF>-related benefits of
$9 and $26 billion at a 3 percent discount rate, and $8 and $23 billion
at a 7 percent discount. These benefits only reflect those associated
with reductions in NO<INF>X</INF> emissions (a precursor to both ozone
and secondarily-formed PM<INF>2.5</INF>) and directly-emitted
PM<INF>2.5</INF> from highway heavy-duty engines. There are additional
human health and environmental benefits associated with reductions in
exposure to ambient concentrations of PM<INF>2.5</INF>, ozone, and NO2
that EPA has not quantified due to data, resource, or methodological
limitations. There would also be benefits associated with reductions in
air toxic pollutant emissions that result from the proposed program,
but we did not attempt to monetize those impacts due to methodological
limitations. The estimated benefits of the proposed Options 1 and 2
would be larger if we were able to monetize all unquantified benefits
at this time. More detailed information about the benefits analysis
conducted for the proposal, including the present value of program
benefits for Options 1 and 2, is included in Section VIII and draft RIA
Chapter 8.
---------------------------------------------------------------------------

\49\ 2045 is a snapshot year chosen to approximate the annual
health benefits that occur in a year in which the proposed program
would be fully implemented and when most of the regulated fleet
would have turned over.
---------------------------------------------------------------------------

We compare total monetized health benefits to total costs
associated with the proposed Options 1 and 2 in Section IX. Table 6
shows that annual benefits of the proposed Option 1 would be larger
than the annual costs in 2045, with annual net benefits of $9 and $31
billion assuming a 3 percent discount rate, and net benefits of $8 and
$28 billion assuming a 7 percent discount rate.\50\ Annual benefits
would also be larger than annual costs in 2045 for the proposed Option
2, although net benefits would be slightly lower than from the proposed
Option 1 (net benefits of proposed Option 2 would be $6 and $23 billion
at a 3 percent discount rate, and net benefits of $5 and 21 billion at
a 7 percent discount rate). For both the proposed Options 1 and 2,
benefits also outweigh the costs when expressed in present value terms
and as equalized annual values.
---------------------------------------------------------------------------

\50\ The range of benefits and net benefits reflects a
combination of assumed PM<INF>2.5</INF> and ozone mortality risk
estimates and selected discount rate.

Table 6--2045 Costs, Benefits and Net Benefits of the Proposed Option 1 and Option 2
[Billions, 2017$] a b
----------------------------------------------------------------------------------------------------------------
Proposed Option 1 Proposed Option 2
---------------------------------------------------------------
3% discount 7% discount 3% discount 7% discount
----------------------------------------------------------------------------------------------------------------
2045:
Benefits.................................... $12-$33 $10-$30 $9.1-$26 $8.2-$23
Costs....................................... 2.3 2.3 2.9 2.9

[[Page 17429]]

Net Benefits................................ 9.2-31 8.1-28 6.2-23 5.3-21
----------------------------------------------------------------------------------------------------------------
\a\ All benefits estimates are rounded to two significant figures; numbers may not sum due to independent
rounding. The range of benefits (and net benefits) in this table are two separate estimates and do not
represent lower- and upper-bound estimates, though they do reflect a grouping of estimates that yield more and
less conservative benefits totals. The costs and benefits in 2045 are presented in annual terms and are not
discounted. However, all benefits in the table reflect a 3 percent and 7 percent discount rate used to account
for cessation lag in the valuation of avoided premature deaths associated with long-term exposure.
\b\ The benefits associated with the standards presented here do not include the full complement of health,
environmental, and climate-related benefits that, if quantified and monetized, would increase the total
monetized benefits.

Section X examines the potential impacts of the proposed standards
on heavy-duty vehicles (sales, mode shift, fleet turnover) and
employment in the heavy-duty industry. The proposed standards may
impact vehicle sales due to both changes in purchase price and longer
emission warranty mileage requirements; these effects may show up as
increased purchases of more new vehicles than usual before the proposed
standards come into effect, in anticipation of higher prices after the
proposed standards (``pre-buy''). The proposed standards may also
reduce sales after the proposed standards would be in place (``low-
buy''). In this proposal, we suggest an approach to quantify potential
impacts on vehicle sales due to new emission standards; we also provide
an example of how the results could be applied to the final regulatory
analysis for this rule in draft RIA Chapter 10.1. Our example results
for proposed Option 1 suggest pre- and low-buy for Class 8 trucks may
range from zero to approximately two percent increase in sales over a
period of up to 8 months before the 2031 standards begin (pre-buy), and
a decrease in sales from zero to approximately two percent over a
period of up to 12 months after the 2031 standards begin (low-buy). We
have provided the example results as information for commenters to
consider and provide input to EPA on this type of approach for
quantifying how emissions regulations may impact heavy-duty vehicle
sales fleet turnover. Based on input we receive, we may consider using
this type of analysis in the final rule to inform both the potential
impacts on vehicle sales, and the related impacts on employment in the
heavy-duty industry. We expect little mode shift due to the proposed
standards because of the large difference in cost of moving goods via
trucks versus other modes of transport (e.g., planes or barges).
Employment impacts of the proposed standards depend on the effects
of the standards on sales, the share of labor in the costs of the
standards, and changes in labor intensity due to the standards. We
quantify the effects of costs on employment, and we discuss the effects
due to sales and labor intensity qualitatively. This partial
quantification of employment impacts estimates that increased costs of
vehicles and parts would, by itself and holding labor intensity
constant, be expected to increase employment by 400 to 2,200 job-years
in 2027, and 300 to 1,800 job-years in 2032 under proposed Option
1.\51\ Employment would be expected to increase by 400 to 2,200 job
years, and 300 to 1,500 job years in 2027 and 2032 respectively under
proposed Option 2. See Section X for further detail on limitations and
assumptions of this analysis.
---------------------------------------------------------------------------

\51\ Where a job-year is, for example, one year of full-time
work for one person, or one year of half-time work for two people.
---------------------------------------------------------------------------

Finally, the projected cost and GHG emission impacts of the
proposed changes to the HD GHG Phase 2 program are described in Section
XI.E.

E. Summary of Specific Requests for Comments

We are requesting comment on all aspects of this proposed
rulemaking. In addition, as detailed in the sections that follow, we
are specifically requesting comments from stakeholders on a variety of
key topics throughout this proposed to inform the final rulemaking
process. In this section we highlight topics on which we believe it
would be especially beneficial to receive comments from stakeholders,
or which may be of most interest to stakeholders.
Section III presents extensive information and analyses, including
two options for the proposed criteria pollutant standards, to provide
notice that EPA will be considering a range of numeric emission
standard values and implementation dates in the final rule. We are
requesting comment on the proposed Options 1 and 2, as well as the
Alternative, standards for each duty cycle, as well as the one- and
two-step approaches in proposed Options 1 and 2, respectively, and the
implementation dates of MYs 2027 and 2031. In addition, we are
requesting input on several aspects of the proposed new LLC duty cycle
for heavy-duty CI engines and applying the SET duty cycle to heavy-duty
SI engines (see Section III). We are also requesting comment on several
aspects of the proposed off-cycle standards for heavy-duty CI engines,
including the levels of the standards in proposed Options 1 and 2 and
the specific operating range covered by each bin, and whether off-cycle
standards and in-use testing should also apply for SI engines. For SI
engines, we request comment on our proposed refueling HC emission
standard for incomplete vehicles above 14,000 lb GVWR, including
requests for comment and data to inform test procedure updates we
should consider to measure HC emissions from these larger fuel systems
and vehicles. We are also requesting comment on whether EPA should
finalize interim standards for testing used to verify that the engine
meets the standards through useful life (i.e., in-use testing that
occurs after the vehicle enters commerce). Typically, EPA sets the same
standards for in-use testing and certification testing but, in some
cases, we have provided higher in-use standards to give manufacturers
time to gain experience with the new technology needed to meet the
standards.\52\ As outlined in this Executive Summary and discussed in
Sections III and IV, we are proposing to significantly lower
NO<INF>X</INF> emission standards and to significantly increase the
regulatory useful life for heavy-duty on highway engines, which would
require manufactures to develop and produce additional engine and
aftertreatment technology. Due to the combination of lower (more
stringent) numeric standards and longer useful periods included in our
proposal, we are requesting comment on whether

[[Page 17430]]

EPA should finalize in-use standards that are 40 to 100 percent higher
than the proposed Option 1 standards for MY 2027 to MY 2033 engines.
---------------------------------------------------------------------------

\52\ See 81 FR 23414 (April 28, 2014).
---------------------------------------------------------------------------

In Section IV we detail our requests for comment on a number of
topics related to our proposed lengthened useful life and warranty
periods, as well as other compliance provisions and flexibilities. For
instance, we are requesting stakeholder input on our proposed useful
life and warranty periods, as well as the range of options covered by
the proposed Options 1 and 2, or other alternatives outside of that
range. In addition to the proposed warranty periods, we request comment
on other approaches to warranty, such as graduated warranty phases,
that may similarly ensure long-term in-use emission performance with a
smaller impact on the purchase price. We further request comment on our
proposed provisions to increase the likelihood that emission controls
will be maintained properly through more of the service life of heavy-
duty engines (e.g., revise inducement strategies, improve
serviceability). In addition, we are interested in stakeholder input on
our proposed approaches for the durability demonstration that
manufacturers are required to include their application for
certification (see Section IV.F for details). We are also interested in
stakeholder input on our proposed requirements for manufacturers
choosing to generate NO<INF>X</INF> emission credits from BEVs or
FCEVs, as well as whether EPA should consider for this final rule, or
other future rules, restrictions for NO<INF>X</INF> emission credits in
the longer term (e.g., beyond MY 2031) (See Section IV.I for details).
Throughout Sections III and IV, we discuss areas where our proposal
differs from the California Air Resources Board (CARB) Heavy-Duty
Omnibus Rulemaking, and request comment on our proposal, including
whether it is appropriate to harmonize the federal and CARB regulatory
programs more in light of the authority and requirements of CAA section
202, and the benefits or challenges if EPA were to finalize particular
aspects of its program that are or are not fully aligned with the
Omnibus.
There are also several topics that we are requesting comment on
that relate to the analyses that support our proposal. For instance, we
are interested in stakeholder input on our approach for estimating
emission reductions from lengthening useful life and warranty periods
(see Section VI for details). We are also interested in comments on our
estimate of repair costs for emission control system components (see
Section V for details). We request comment on the method we outline to
estimate potential impacts of a proposed regulation on heavy-duty
vehicle sales; we also request comment on approaches to estimate
employment impacts attributable to the proposed rule (see Section X for
details).
We are also interested in input from environmental justice
stakeholders and underserved and overburdened communities, including
children's health stakeholders, regarding the need for revised
standards and how heavy-duty vehicles affect communities (see Section
II); the air quality improvements we project from this proposal and how
they are distributed (see Section VII); and ways the proposal could be
improved to advance environmental protection for all people, including
people of color, low-income communities, and those who live near
highways or in heavily trafficked areas with frequent truck congestion
and idling, such as ports.
In Section XI, we request comment in a number of areas related to
the proposed updates to the HD GHG Phase 2 program for certain heavy-
duty vehicles that are shifting to zero-emission vehicles. We are
considering whether it would be appropriate in the final rule to
increase the stringency of the standards even more than what we
propose. Therefore, we request information on heavy-duty electric
vehicle sales projections, including for what HD vehicle types, to help
inform our HD electric vehicle sales projections in the MY 2024 through
MY 2029 timeframe. We also are considering whether to establish more
stringent standards beyond MY 2027, specifically in MY 2028 and MY 2029
using the methodology described in Section XI.C.1. We request comment
on appropriate stringency and supporting data for each of those model
years.
We are also interested in stakeholder input that supports changes
to the advanced technology credit multiplier approach under
consideration. In addition, we request comment under this proposal on
how EPA can best consider the potential for ZEV technology to
significantly reduce air pollution from the heavy-duty vehicle sector,
including whether and how to consider including specific sales
requirements for HD ZEVs.
For these and all requests for comment detailed throughout the
proposal, stakeholders are encouraged to provide their rationale and
any available data that supports to their perspectives.

I. Introduction

A. Brief Overview of the Heavy-Duty Truck Industry

Heavy-duty highway vehicles (also referred to as ``trucks'' in this
preamble) range from commercial pickup trucks to vocational vehicles
that support local and regional transportation, construction, refuse
collection, and delivery work, to line-haul tractor-trailers that move
freight cross-country. This diverse array of vehicles is categorized
into weight classes based on gross vehicle weight ratings (GVWR). These
weight classes span Class 2b pickup trucks and vans from 8,500 to
10,000 lbs GVWR through Class 8 line-haul tractors and other commercial
vehicles that exceed 33,000 lbs GVWR.53 54
---------------------------------------------------------------------------

\53\ This proposed rulemaking includes revised criteria
pollutants standards for engine-certified Class 2b through 8 heavy-
duty engines and vehicles; this proposal also includes revised GHG
standards for Class 4 through 8 vehicles. Class 2b and 3 vehicles
with GVWR between 8,500 and 14,000 pounds are primarily commercial
pickup trucks and vans and are sometimes referred to as ``medium-
duty vehicles''. The majority of Class 2b and 3 vehicles are
chassis-certified vehicles and will be included in a future combined
light-duty and medium-duty rulemaking action, consistent with E.O.
14037, Section 2a. Heavy-duty engines and vehicles are also used in
nonroad applications, such as construction equipment; nonroad heavy-
duty engines and vehicles are not the focus of this proposal. See
Section I for more discussion on the spectrum of heavy-duty vehicles
and how they relate to the proposed rule. See Sections I.B and III
for more discussion on the spectrum of heavy-duty vehicles and how
they relate to the proposed rule.
\54\ The focus of this proposal is on highway heavy-duty engines
and vehicles. However, we are also proposing limited amendments to
regulations that implement our air pollutant emission standards for
other sectors, including light-duty vehicles, light-duty trucks,
marine diesel engines, locomotives, and various types of nonroad
engines, vehicles, and equipment (see Section XII).
---------------------------------------------------------------------------

Heavy-duty highway vehicles are primarily powered by diesel-fueled,
compression-ignition (CI) engines. However, gasoline-fueled, spark-
ignition (SI) engines are common in the lighter weight classes, and
smaller numbers of alternative fuel engines (e.g., liquified petroleum
gas, compressed natural gas) are found in the heavy-duty fleet.
Vehicles powered by electricity, either in the form of battery electric
vehicles (BEVs) or fuel cell electric vehicles (FCEVs) are also
increasingly entering the heavy-duty fleet. The operational
characteristics of some commercial applications (e.g., delivery
vehicles) can be similar across several vehicle weight classes,
allowing a single engine, or electric power source in the case of BEVs
and FCEVs, to be installed in a variety of vehicles. For instance,
engine specifications needed for a Class 4 parcel delivery vehicle may
be similar

[[Page 17431]]

to the needs of a Class 5 mixed freight delivery vehicle or a Class 6
beverage truck. Any performance differences needed to operate across
this range of vehicles can be achieved through adjustments to chassis-
based systems (i.e., transmission, cooling system) external to the
engine.
The industry that designs and manufactures these heavy-duty
vehicles is composed of three primary segments: Vehicle manufacturers,
engine manufacturers and other major component manufacturers, and
secondary manufacturers (i.e., body builders). Some vehicle
manufacturers are vertically integrated, designing, developing, and
testing their engines in-house for use in their vehicles, while others
purchase some or all of their engines from independent engine
suppliers. Today, only one major independent engine manufacturer
supports the heavy-duty truck industry, though some vehicle
manufactures sell their engines or ``incomplete vehicles'' (i.e.,
chassis that include their engines, the frame, and a transmission) to
body builders who design and assemble the final vehicle. Each of these
subindustries is often supported by common suppliers for subsystems
such as transmissions, axles, engine controls, and emission controls.
In addition to the manufacturers and suppliers responsible for
producing highway heavy-duty vehicles, an extended network of
dealerships, repair and service facilities, and rebuilding facilities
contribute to the sale, maintenance, and extended life of these
vehicles and engines. Heavy-duty vehicle dealerships offer customers a
place to order vehicles from a specific manufacturer and include
service facilities for those vehicles and engines. Dealership service
technicians are trained to perform regular maintenance and make
repairs, which generally include repairs under warranty and in response
to manufacturer recalls. Some trucking fleets, businesses, and large
municipalities benefit from hiring their own technicians to service
their vehicles in their own facilities. Many refueling centers along
major trucking routes have also expanded their facilities to include
roadside assistance and service stations to diagnose and repair common
problems.
Heavy-duty CI engines installed in the larger weight classes of
vehicles are designed to be rebuilt. Dealerships and other service
facilities are generally equipped to replace common components, such as
pistons and bearings that wear over time. However, large-scale (i.e.,
``out-of-frame'') engine overhauls that replace most of the engine
components require a more sophisticated process that only a limited
number of facilities provide. Some heavy-duty engine manufacturers have
established their own rebuilding facilities as a separate branch of
their operations and others work with independent rebuilding factories
that are affiliated with multiple engine manufacturers. Rebuilding
allows owners to extend the life of their engines at a lower cost than
purchasing a replacement vehicle, which has made the practice common
for some heavy-duty engines.
The end-users for highway heavy-duty vehicles are as diverse as the
applications for which these vehicles are purchased. Smaller weight
class heavy-duty vehicles are commonly purchased by delivery services,
contractors, and municipalities. The middle weight class vehicles tend
to be commercial vehicles for businesses and municipal work that
transport people and goods locally and regionally or provide services
such as utilities. Vehicles in the heaviest weight classes are
generally purchased by businesses with high load demands, such as
construction, towing or refuse collection, or freight delivery fleets
and owner-operators with both load and speed demands for regional and
long-haul goods movement. The competitive nature of the businesses and
owner-operators that purchase and operate highway heavy-duty vehicles
means that any time the vehicle is unable to operate due to maintenance
or repair (i.e., downtime) can lead to a loss in income. This need for
reliability drives much of the truck and engine manufacturers'
innovation and research to meet the needs of their customers.

B. History of Emission Standards for Heavy-Duty Engines and Vehicles

Emission standards for heavy-duty highway engines in the U.S. were
first issued by the Department of Health, Education, and Welfare in the
1960s. These standards and the corresponding certification and testing
procedures were codified at 45 CFR part 1201. In 1972, shortly after
EPA was created as a federal agency and given responsibility for
regulating heavy-duty engines, EPA published new standards and updated
procedures while migrating the regulations to 40 CFR part 85 as part of
the effort to consolidate all EPA regulations in a single location.\55\
EPA created 40 CFR part 86 in 1976 to reorganize emission standards and
certification requirements for light-duty vehicles and heavy-duty
highway engines. In 1985, EPA promulgated new standards for heavy-duty
highway engines, codifying the standards in 40 CFR part 86, subpart A.
Since then, EPA has promulgated several rules for highway heavy-duty
engines and vehicles to set new and more stringent emission standards
for criteria pollutants and precursors,\56\ to set requirements for
controlling evaporative and refueling emissions,\57\ to establish
emission control programs for greenhouse gases (GHGs), and to add or
revise certification procedures.\58\
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\55\ See Section I.G for additional discussion on EPA's
Statutory Authority relevant to this proposal.
\56\ For example, oxides of nitrogen (NO<INF>X</INF>),
hydrocarbons (HC), particulate matter (PM) and carbon monoxide (CO).
\57\ See Section III.E for more discussion on controlling
evaporative and refueling emissions from light- and heavy-duty
vehicles.
\58\ U.S. Environmental Protection Agency. ``EPA Emission
Standards for Heavy-Duty Highway Engines and Vehicles,'' Available
online: <a href="https://www.epa.gov/emission-standards-reference-guide/epa-emission-standards-heavy-duty-highway-engines-and-vehicles">https://www.epa.gov/emission-standards-reference-guide/epa-emission-standards-heavy-duty-highway-engines-and-vehicles</a>. (last
accessed June 25, 2021).
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EPA's criteria pollutant regulatory programs for the heavy-duty
highway industry apply to engines.\59\ Our regulations require that
engine manufacturers identify the ``primary intended service class''
for each engine by considering the vehicles for which they design and
market their engines. Heavy-duty CI engines are specified as light
heavy-duty engine (Light HDE), medium heavy-duty engine (Medium HDE),
or heavy heavy-duty engine (Heavy HDE) based largely on the weight
class of the vehicles in which the engines are expected to be installed
and the potential for rebuild. SI heavy-duty engines are generally
specified as a single spark-ignition HDE service class unless they are
designed or intended for use in the largest heavy-duty vehicles, and
therefore considered heavy HDEs.\60\ EPA sets emission standards and
other regulatory provisions, including regulatory useful life and
emissions warranty periods, that are targeted for the operational
characteristics of each primary intended service class.
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\59\ EPA's regulations address heavy-duty engines and vehicles
separately from light-duty vehicles. Vehicles with GVWR above 8,500
pounds (Class 2b and above) are classified in the regulations as
heavy-duty. For criteria pollutants EPA's standards generally apply
to the engine rather than the vehicle for heavy-duty. However, most
of the Class 2b and 3 pickup trucks and vans (vehicles with a GVWR
between 8,500 and 14,000 pounds) are chassis-certified heavy-duty
vehicles and covered by standards in EPA's Tier 3 program (79 FR
23414, April 28, 2014; 80 FR 0978, February 19, 2015). As noted in
Section III, there are a small number of Class 2b and 3 engines
(e.g., trucks with dual rear wheels that are sold with a cab and
chassis only), which are the subject of this proposed rulemaking.
\60\ See 40 CFR 1036.140(a)(3).
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In the 1990s, EPA issued increasingly stringent standards for
NO<INF>X</INF>, CO, HC,

[[Page 17432]]

and PM. These exhaust standards were derived from engine-based emission
control strategies and manufacturers generally certified their engines'
emission performance over defined duty cycles on an engine dynamometer
(i.e., ``engine certification''). In 1997, EPA finalized standards for
heavy-duty highway diesels (62 FR 54693, October 21, 1997), effective
beginning with the 2004 model year, including a combined non-methane
hydrocarbon (NMHC) and NO<INF>X</INF> standard that represented a
reduction of NO<INF>X</INF> emissions by 50 percent. These
NO<INF>X</INF> reductions also resulted in significant reductions in
secondary nitrate PM.
In early 2001, EPA finalized the 2007 Heavy-Duty Engine and Vehicle
Rule (66 FR 5002, January 18, 2001) to continue addressing
NO<INF>X</INF> and PM emissions from both diesel and gasoline-fueled
highway heavy-duty engines. This rule established a comprehensive
national program that regulated a heavy-duty engine and its fuel as a
single system, with emission standards taking effect beginning with
model year (MY) 2007 and fully phasing in by MY 2010 (EPA 2010
standards). Prior to 2007, emission standards were based on controlling
the emissions formed during the combustion process (i.e., engine-out
emissions), and there was no further control of emissions between the
engine and the truck's tailpipe. But with promulgation of the 2007
final rule, emission standards were, for the first time, based on the
use of technologies to capture, convert, and reduce harmful engine-out
emissions, resulting in tailpipe emissions that were cleaner than
engine-out emissions. By and large, the industry met these new
standards through the use of exhaust aftertreatment technologies,
namely, diesel oxidation catalysts, particulate filters, and high-
efficiency catalytic exhaust emission control devices. Consistent with
previous criteria pollutant regulatory programs, the program also
offered flexibility to manufacturers through the use of various
emission credits averaging, banking, and trading (ABT) programs.
To ensure proper functioning of these aftertreatment technologies,
which could be damaged by sulfur, EPA also reduced the allowable level
of sulfur in highway diesel fuel by 97 percent by mid-2006. Together,
the use of exhaust aftertreatment technologies and lower-sulfur fuel
resulted in diesel-fueled trucks that emitted PM and NO<INF>X</INF>
tailpipe emissions at levels 90 percent and 95 percent below emission
levels from then-current highway heavy-duty engines, respectively. The
PM standard for new highway heavy-duty engines was set at 0.01 grams
(10 milligrams, or 10 mg) per horsepower-hour (mg/hp-hr) by MY 2007 and
the NO<INF>X</INF> and NMHC standards of 200 mg/hp-hr and 140 mg/hp-hr,
respectively, were set to phase in between model years 2007 and
2010.\61\ In finalizing that rule, EPA estimated that the emission
reductions would achieve significant health and environmental impacts,
and that the total monetized PM<INF>2.5</INF> and ozone-related
benefits of the program would exceed $70 billion, versus program costs
of $4 billion (1999$).
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\61\ Heavy-duty engine emission standards are defined in work
specific units (i.e., milligrams per horsepower-hour) because the
standards cover a large range of engine ratings, and thus time
specific standards would not provide equal stringency across all
engines.
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In 2005, EPA finalized a manufacturer-run, in-use testing program
that uses portable emission measurement systems to measure HC, CO,
NO<INF>X</INF>, and PM emissions from the exhaust of in-use heavy-duty
diesel trucks (70 FR 34594, June 14, 2005). The fully enforceable
program began in 2007. This effort was a significant advancement in
helping to ensure that the benefits of more stringent emission
standards are realized under real-world driving conditions.
In 2009, as advanced emissions control systems were being
introduced to meet the MY 2007/2010 standards, EPA promulgated a final
rule to require that these advanced emissions control systems be
monitored for malfunctions via an onboard diagnostic (OBD) system (74
FR 8310, February 24, 2009). The rule, which has been fully phased in,
required engine manufacturers to install OBD systems that monitor the
functioning of emission control components on new engines and alert the
vehicle operator to any detected need for emission-related repair. It
also required that manufacturers make available to the service and
repair industry information necessary to perform repair and maintenance
service on OBD systems and other emission related engine components. In
addition, EPA published a series of documents that provided guidance to
manufacturers on potential methods and measures to ensure that trucks
equipped with Selective Catalytic Reduction (SCR) technology would be
refilled with the specified quantity and quality of a urea-water
mixture (also known as diesel exhaust fluid, or DEF) necessary for the
proper functioning of this NO<INF>X</INF>-reducing technology. These
guidance documents describe potential approaches that included
progressive levels of alerts and warnings communicated to the driver of
the truck, which would allow adequate time to refill the DEF tank, but
ultimately, if DEF is not added, or if it is determined to be of
insufficient quality, a vehicle speed-limiting ``inducement'' would be
triggered, requiring the DEF tank to be refilled or the system to be
repaired.
Also in 2009, EPA and Department of Transportation's National
Highway Traffic Safety Administration (NHTSA) began working on a joint
regulatory program to reduce GHG emissions and fuel consumption from
heavy-duty vehicles and engines.\62\ By utilizing regulatory approaches
recommended by the National Academy of Sciences, the first phase
(``Phase 1'') of the GHG and fuel efficiency program was finalized in
2011 (76 FR 57106, September 15, 2011).\63\ The Phase 1 program,
spanning implementation from MY 2014 to 2018, included separate
standards for highway heavy-duty vehicles and heavy-duty engines. The
program offered flexibility allowing manufacturers to attain these
standards through a mix of technologies and the option to participate
in an emissions credit ABT program. In the Phase 1 rulemaking EPA also
revised the heavy-duty vehicle and engine regulations to make them
consistent with the light-duty vehicle approach, such that all criteria
pollutant and GHG standards would apply regardless of fuel type,
including all-electric vehicles (EVs).
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\62\ Greenhouse gas emissions from heavy-duty engines are
primarily carbon dioxide (CO2), but also include methane
(CH<INF>4</INF>) and nitrous oxide (N<INF>2</INF>O). Because
CO<INF>2</INF> is formed from the combustion of fuel, it is directly
related to fuel consumption.
\63\ National Research Council; Transportation Research Board.
The National Academies' Committee to Assess Fuel Economy
Technologies for Medium- and Heavy-Duty Vehicles; ``Technologies and
Approaches to Reducing the Fuel Consumption of Medium- and Heavy-
Duty Vehicles.'' 2010. Available online: <a href="https://www.nap.edu/catalog/12845/technologies-and-approaches-to-reducing-the-fuel-consumption-of-medium-and-heavy-duty-vehicles">https://www.nap.edu/catalog/12845/technologies-and-approaches-to-reducing-the-fuel-consumption-of-medium-and-heavy-duty-vehicles</a>.
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In 2016, EPA and NHTSA finalized the Heavy-Duty Phase 2 GHG and
fuel efficiency program (``HD GHG Phase 2'') (81 FR 73478, October 25,
2016). HD GHG Phase 2 includes technology-advancing performance-based
standards for highway heavy-duty vehicles and heavy-duty engines that
will phase in over the long term, with initial standards for most
vehicles and engines commencing in MY 2021, increasing in stringency in
MY 2024, and culminating in MY 2027 standards. HD GHG Phase 2 built
upon the Phase 1 program and set standards based not only on currently
available technologies, but also on technologies that were still under
development or not yet widely deployed. To ensure adequate time for

[[Page 17433]]

technology development, HD GHG Phase 2 provided up to 10 years lead
time to allow for the development and phase-in of these control
technologies. EPA recently finalized technical amendments to the HD GHG
Phase 2 rulemaking (``HD Technical Amendments'') that included changes
to the test procedures for heavy-duty engines and vehicles to improve
accuracy and reduce testing burden.\64\
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\64\ 86 FR 34308, June 29, 2021.
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C. Petitions to EPA for Additional NOX Emissions Control

In the summer of 2016 more than 20 organizations, including state
and local air agencies from across the country, petitioned EPA to
develop more stringent NO<INF>X</INF> emission standards for on-road
heavy-duty engines.\65\ Among the reasons stated by the petitioners for
such an EPA rulemaking was the need for NO<INF>X</INF> emission
reductions to reduce adverse health and welfare impacts and to help
areas attain the NAAQS. EPA subsequently met with a wide range of
stakeholders in listening sessions, during which certain themes were
consistent across those stakeholders.\66\ For example, it became clear
that there is broad support for federal action in collaboration with
the California Air Resources Board (CARB). So-called ``50-state''
standards would enable technology suppliers and manufacturers to
efficiently produce a single set of reliable and compliant products.
There was also broad acknowledgement of the value of aligning
implementation of new NO<INF>X</INF> standards with existing MY 2021,
2024, and 2027 milestones for HD Phase 2 GHG and fuel efficiency
standards. Stakeholders thought that such alignment would ensure that
the GHG and fuel consumption reductions achieved under HD GHG Phase 2
are maintained and allow the regulated industry to implement GHG- and
NO<INF>X</INF>-reducing technologies into their products at the same
time.\67\
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\65\ Brakora, Jessica. ``Petitions to EPA for Revised
NO<INF>X</INF> Standards for Heavy-Duty Engines'' Memorandum to
Docket EPA-HQ-OAR-2019-0055. December 4, 2019.
\66\ Stakeholders included: Emissions control technology
suppliers; engine and vehicle manufacturers; a labor union that
represents heavy-duty engine, parts, and vehicle manufacturing
workers; a heavy-duty trucking fleet trade association; an owner-
operator driver association; a truck dealers trade association;
environmental, non-governmental organizations; states and regional
air quality districts; Tribal interests; California Air Resources
Board (CARB); and the petitioners.
\67\ U.S. EPA. 2016. Memorandum in Response to Petition for
Rulemaking to Adopt Ultra-Low NO<INF>X</INF> Standards for On-
Highway Heavy-Duty Trucks and Engines. Available at <a href="https://19january2017snapshot.epa.gov/sites/production/files/2016-12/documents/nox-memorandum-nox-petition-response-2016-12-20.pdf">https://19january2017snapshot.epa.gov/sites/production/files/2016-12/documents/nox-memorandum-nox-petition-response-2016-12-20.pdf</a>.
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EPA responded to the petitions on December 20, 2016, noting that an
opportunity exists to develop a new, harmonized national NO<INF>X</INF>
reduction strategy for heavy-duty highway engines.\68\ EPA emphasized
the importance of scientific and technological information when
determining the appropriate level and form of a future low
NO<INF>X</INF> standard and highlighted the following potential
components of the action:
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\68\ U.S. EPA. 2016. Memorandum in Response to Petition for
Rulemaking to Adopt Ultra-Low NO<INF>X</INF> Standards for On-
Highway Heavy-Duty Trucks and Engines. Available at <a href="https://19january2017snapshot.epa.gov/sites/production/files/2016-12/documents/nox-memorandum-nox-petition-response-2016-12-20.pdf">https://19january2017snapshot.epa.gov/sites/production/files/2016-12/documents/nox-memorandum-nox-petition-response-2016-12-20.pdf</a>.

<bullet> Lower NO<INF>X</INF> emission standards
<bullet> Improvements to test procedures and test cycles to ensure
emission reductions occur in the real world, not only over the
currently applicable certification test cycles
<bullet> Updated certification and in-use testing protocols
<bullet> Longer periods of mandatory emission-related component
warranties
<bullet> Consideration of longer regulatory useful life, reflecting
actual in-use activity
<bullet> Consideration of rebuilding
<bullet> Incentives to encourage the transition to current- and next-
generation cleaner technologies as soon as possible

As outlined in the Executive Summary and detailed in the sections
that follow, this proposed rulemaking considered these components.

D. California Heavy-Duty Highway Low NOX Program Development

In this section, we present a summary of recent efforts by the
state of California to establish new, lower emission standards for
highway heavy-duty engines and vehicles.\69\ For the past several
decades, EPA and the California Air Resources Board (CARB) have worked
together to reduce air pollutants from highway heavy-duty engines and
vehicles by establishing harmonized emission standards for new engines
and vehicles. For much of this time, EPA has taken the lead in
establishing emission standards through notice and comment rulemaking,
after which CARB would adopt the same standards and test procedures.
For example, EPA promulgated the current heavy-duty engine
NO<INF>X</INF> and PM standards in a 2001 final rule, and CARB
subsequently adopted the same emission standards. EPA and CARB often
cooperate during the implementation of highway heavy-duty standards.
Thus, for many years, the regulated industry has been able to design a
single product line of engines and vehicles that can be certified to
both EPA and CARB emission standards (which have been the same) and
sold in all 50 states.
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\69\ California has long had the unique ability among states to
adopt its own separate new motor vehicle and engine standards per
Section 209 of the Clean Air Act. Although CAA section 209(a)
expressly preempts states from adopting and enforcing standards
relating to the control of emissions from new motor vehicles or new
motor vehicle engines (such as state controls for new heavy-duty
engines and vehicles), CAA section 209(b) directs EPA to waive this
preemption for California under certain conditions. Even with
California's ability under the CAA to establish its own emission
standards, EPA and the California Air Resources Board have worked
closely together over the past several decades to largely harmonize
new heavy-duty vehicle and engine criteria pollutant standard
programs.
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Given the significant ozone and PM air quality challenges in the
state of California, CARB has taken several steps since the EPA 2010
standards were implemented to encourage or establish standards and
requirements that go beyond EPA requirements, to further reduce
NO<INF>X</INF> emissions from heavy-duty vehicles and engines in its
state. CARB's optional (voluntary) low NO<INF>X</INF> program, which
started in 2013, was created to encourage heavy-duty engine
manufacturers to introduce technologies that emit NO<INF>X</INF> at
levels below the current EPA 2010 standards. Under this optional
program, manufacturers can certify engines to one of three levels of
stringency that are 50, 75, and 90 percent below the existing EPA 2010
standards with the lowest optional standard being 20 milligrams
NO<INF>X</INF> per horsepower-hour (mg/hp-h).\70\ To date, only natural
gas and liquefied petroleum gas engines have been certified to these
optional standards.\71\
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\70\ California Code of Regulations, Title 13, section 1956.8.
\71\ California Air Resources Board. ``Optional Low
NO<INF>X</INF> Certified Heavy-Duty Engines''. February 2020.
Available online: <a href="https://ww3.arb.ca.gov/msprog/onroad/optionnox/optional_low_nox_certified_hd_engines.pdf">https://ww3.arb.ca.gov/msprog/onroad/optionnox/optional_low_nox_certified_hd_engines.pdf</a>.
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In May 2016, CARB published its Mobile Source Strategy that
outlined its approach to reduce in-state emissions from mobile sources
and meet its air quality targets.\72\ In November 2016, CARB held its
first Public Workshop on its plans to update its heavy-duty engine and
vehicle programs.\73\ CARB's 2016 Workshop kicked off a technology

[[Page 17434]]

demonstration program (the CARB ``Low NO<INF>X</INF> Demonstration
Program''), and announced plans to update emission standards,
laboratory-based and in-use test procedures, emissions warranty,
durability demonstration requirements, and regulatory useful life
provisions. The initiatives introduced in its 2016 Workshop have since
become components of CARB's Heavy-Duty ``Omnibus'' Rulemaking.\74\
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\72\ California Air Resources Board. ``Mobile Source Strategy''.
May 2016. Available online: <a href="https://ww3.arb.ca.gov/planning/sip/2016sip/2016mobsrc.pdf">https://ww3.arb.ca.gov/planning/sip/2016sip/2016mobsrc.pdf</a>.
\73\ California Air Resources Board. ``Heavy-Duty Low
NO<INF>X</INF>: Meetings & Workshops''. Available online: <a href="https://ww2.arb.ca.gov/our-work/programs/heavy-duty-low-nox/heavy-duty-low-nox-meetings-workshops">https://ww2.arb.ca.gov/our-work/programs/heavy-duty-low-nox/heavy-duty-low-nox-meetings-workshops</a>.
\74\ California Air Resources Board. Heavy-Duty Engine and
Vehicle Omnibus Regulation and Associated Amendments. Available
online: <a href="https://ww2.arb.ca.gov/rulemaking/2020/hdomnibuslownox">https://ww2.arb.ca.gov/rulemaking/2020/hdomnibuslownox</a>.
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CARB's goal for its Low NO<INF>X</INF> Demonstration Program was to
investigate the feasibility of reducing NO<INF>X</INF> emissions to
levels significantly below today's EPA 2010 standards. Southwest
Research Institute (SwRI) was contracted to perform the work, which was
split into three ``Stages.'' \75\ In Stage 1 and 1b, SwRI demonstrated
an engine technology package capable of achieving a 90 percent
NO<INF>X</INF> emissions reduction on today's regulatory test cycles to
a useful life of 435,000 miles using an accelerated aging process.\76\
In Stage 2, SwRI developed and evaluated a new low load-focused engine
test cycle. In Stage 3, SwRI evaluated a new engine platform and
different technology package to ensure both criteria and GHG emission
performance. EPA has been closely observing CARB's Low NO<INF>X</INF>
Demonstration Program as a member of the Low NO<INF>X</INF> Advisory
Group for the technology development work, which includes
representatives from heavy-duty engine and aftertreatment industries,
as well as from federal, state, and local governmental agencies.\77\
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\75\ Southwest Research Institute. ``Update on Heavy-Duty Low
NO<INF>X</INF> Demonstration Programs at SwRI''. September 26, 2019.
Available online: <a href="https://ww3.arb.ca.gov/msprog/hdlownox/files/workgroup_20190926/guest/swri_hd_low_nox_demo_programs.pdf">https://ww3.arb.ca.gov/msprog/hdlownox/files/workgroup_20190926/guest/swri_hd_low_nox_demo_programs.pdf</a>.
\76\ Southwest Research Institute. ``Evaluating Technologies and
Methods to Lower Nitrogen Oxide Emissions from Heavy-Duty Vehicles:
Final Report''. April 2017. Available online: <a href="https://ww3.arb.ca.gov/research/apr/past/13-312.pdf">https://ww3.arb.ca.gov/research/apr/past/13-312.pdf</a>.
\77\ California Air Resources Board. ``Evaluating Technologies
and Methods to Lower Nitrogen Oxide Emissions from Heavy-Duty
Vehicles''. May 10, 2017. Available online: <a href="https://ww3.arb.ca.gov/research/veh-emissions/low-nox/low-nox.htm">https://ww3.arb.ca.gov/research/veh-emissions/low-nox/low-nox.htm</a>.
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CARB has published several updates related to its Omnibus
Rulemaking. In June 2018, CARB approved its ``Step 1'' update to
California's emission control system warranty regulations.\78\ Starting
in MY 2022, the existing 100,000-mile warranty for all diesel engines
will increase to 110,000 miles for engines certified as light heavy-
duty, 150,000 miles for medium heavy-duty engines, and 350,000 miles
for heavy heavy-duty engines. In November 2018, CARB approved revisions
to the OBD requirements that include implementation of real emissions
assessment logging (REAL) for heavy-duty engines and other
vehicles.\79\ In April 2019, CARB published a ``Staff White Paper'' to
present its staff's assessment of the technologies they believed were
feasible for medium and heavy heavy-duty diesel engines in the 2022-
2026 timeframe.\80\
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\78\ California Air Resources Board. ``HD Warranty 2018'' June
28, 2018. Available online: <a href="https://ww2.arb.ca.gov/rulemaking/2018/hd-warranty-2018">https://ww2.arb.ca.gov/rulemaking/2018/hd-warranty-2018</a>.
\79\ California Air Resources Board. ``Heavy-Duty OBD
Regulations and Rulemaking''. Available online: <a href="https://ww2.arb.ca.gov/resources/documents/heavy-duty-obd-regulations-and-rulemaking">https://ww2.arb.ca.gov/resources/documents/heavy-duty-obd-regulations-and-rulemaking</a>.
\80\ California Air Resources Board. ``California Air Resources
Board Staff Current Assessment of the Technical Feasibility of Lower
NO<INF>X</INF> Standards and Associated Test Procedures for 2022 and
Subsequent Model Year Medium-Duty and Heavy-Duty Diesel Engines''.
April 18, 2019. Available online: <a href="https://ww3.arb.ca.gov/msprog/hdlownox/white_paper_04182019a.pdf">https://ww3.arb.ca.gov/msprog/hdlownox/white_paper_04182019a.pdf</a>.
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In August 2020, the CARB governing board approved the staff
proposal for the Omnibus rule and directed staff to initiate the
process of finalizing the provisions.81 82 The final Omnibus
rule was approved by the California Office of Administrative Law in
December 2021. The final rule includes updates to CARB engine
standards, duty-cycle test procedures, and heavy-duty off-cycle testing
program that would take effect in MY 2024, with additional updates to
warranty, durability, and useful life requirements and further
reductions in standards in MYs 2027 and 2031.\83\
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\81\ California Air Resources Board. ``Staff Report: Initial
Statement of Reasons-Public Hearing to Consider the Proposed Heavy-
Duty Engine and Vehicle Omnibus Regulation and Associated
Amendments''. June 23, 2020. Available online at: <a href="https://ww3.arb.ca.gov/regact/2020/hdomnibuslownox/isor.pdf">https://ww3.arb.ca.gov/regact/2020/hdomnibuslownox/isor.pdf</a>.
\82\ California Air Resources Board. Heavy-Duty Engine and
Vehicle Omnibus Regulation and Associated Amendments. Available
online: <a href="https://ww2.arb.ca.gov/rulemaking/2020/hdomnibuslownox">https://ww2.arb.ca.gov/rulemaking/2020/hdomnibuslownox</a>.
\83\ Throughout this proposal we use ``Omnibus'' to refer to the
engine standards, duty-cycle test procedures, heavy-duty off-cycle
testing program, useful life and warranty requirements included in
the final Omnibus.
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As described in Sections I.F and I.G, with details in Sections III
and IV, EPA is proposing new NO<INF>X</INF>, PM, HC, and CO emission
standards for heavy-duty engines that reflect the greatest degree of
emission reduction achievable through the application of technology
that we have determined would be available for the model years to which
the proposed standards would apply. In doing so we have given
appropriate consideration to additional factors, namely lead time,
cost, energy, and safety (see Sections I.F and I.G for more
discussion). Throughout the rulemaking process we will continue to
evaluate what standards are appropriate given the factors that we are
directed to consider under CAA section 202(a)(3). As noted at the start
of this Section I.D, EPA and CARB have historically worked together to
establish harmonized emission standards for new heavy-duty engines and
vehicles. We have received comments from different stakeholder groups
who have expressed perspectives on the alignment between the EPA and
CARB Omnibus standards they would like EPA to consider during the
rulemaking. For instance, in response to an Advance Notice of Proposed
Rulemaking (ANPR) for this rule, many stakeholders encouraged EPA to
develop a national program harmonized to the greatest extent possible
(see Section I.E).\84\ Following the ANPR, various stakeholders have
provided EPA with additional perspectives on the Omnibus rule and on
the extent to which EPA should align with the California program. For
example, organizations such as the National Association of Clean Air
Agencies,\85\ the National Tribal Air Association,\86\ as well as
multiple vehicle supplier trade associations \87\ have written letters
to EPA in support of strong federal standards that reflect both the
stringency and timeline of CARB's standards. In contrast, some engine
manufacturers have raised concerns about EPA harmonizing its national
program with California's rule because of their concerns with that
program's overall stringency, costs, and focus on near-term
NO<INF>X</INF> reductions over long-term CO<INF>2</INF> emission
reductions. EPA has considered these harmonization comments in light of
the authority and requirements of CAA sections 202 and

[[Page 17435]]

207 in developing the proposed standards, regulatory useful life
periods, and emissions warranty periods and intends to continue to take
into consideration potential harmonization with the CARB Omnibus
program, as appropriate and consistent with CAA sections 202 and 207,
during the rulemaking. As described in Sections III and IV, a notable
difference between the proposed EPA program and the Omnibus rule is
that the first step of the Omnibus rule takes effect in MY 2024,
whereas the first step of the proposed EPA program is in MY 2027. EPA's
statutory authority requires a four-year lead time for any heavy-duty
engine or vehicle standard promulgated or revised under CAA section
202(a)(3) (see Section I.F). In Sections III and IV, we discuss areas
where our proposal aligns with or differs from the Omnibus rule and
request comment on issues related to harmonization between the federal
and CARB regulatory programs, including benefits or challenges if EPA
were to finalize particular aspects of its program that are not fully
aligned with the Omnibus rule.\88\
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\84\ The Agency published an ANPR on January 21, 2020 to present
EPA's early thinking on this rulemaking and solicit feedback from
stakeholders to inform this proposal (85 FR 3306).
\85\ Letter to EPA Administrator Michael Regan from the National
Association of Clean Air Agencies. Re: The urgent need for federal
regulatory action to adopt more stringent NO<INF>X</INF> standards
for heavy-duty engines and vehicles, beginning immediately with
highway heavy-duty trucks. August 26, 2021.
\86\ Letter to EPA Administrator Andrew Wheeler from the
National Tribal Air Association. Re: EPA's Advance Notice of
Proposed Rulemaking for Control of Air Pollution from New Motor
Vehicles: Heavy-Duty Engine Standards Docket ID EPA-HQ-OAR-2019-
0055. February 20, 2020.
\87\ Letter to EPA Administrator Michael Regan from the Motor &
Equipment Manufacturers Association, Manufacturers of Emission
Controls Association, Advanced Engine Systems Institute, and
Alliance for Vehicle Efficiency. Re: Completion of EPA's Heavy-duty
Low-NO<INF>X</INF> Rulemaking. June 24, 2021.
\88\ Draft RIA Chapter 5, Appendix 6 includes tables that
present the main elements (i.e., numeric level of standards, useful
life, emission warranty) of CARB Omnibus requirements and EPA
proposal.
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As discussed in the draft RIA, we analyzed the emission inventory
and air quality impacts for the proposed criteria pollutant standards
before the Omnibus Rule was finalized. We may incorporate the Omnibus
rule into our emission inventory and other analyses as appropriate for
the final rulemaking (FRM).89 90 We also may incorporate the
CARB Advanced Clean Truck (ACT) Regulation into our final rule
analyses. As further discussed in Sections IV, VI, and XI, the CARB ACT
Regulation requires a minimum percentage of each manufacturer's heavy-
duty vehicle sales in the state of California to be zero tailpipe
emission technologies starting in MY 2024.91 92
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\89\ See Section VI and draft RIA Chapter 5 for more information
on our emission inventory modeling for the proposal and plans to
incorporate other updates in our modeling for the final rule.
\90\ EPA has received waiver requests under CAA section 209(b)
from California for the Omnibus or ACT rules; EPA is currently
reviewing the waiver requests for the CA Omnibus and ACT rules and
may consider including these rules in our analyses for the final
rule. See Section III.B for discussion on our proposed approach to a
voluntary standard based on one aspect of the Omnibus requirements.
\91\ CARB. ``Notice of Decision: Advanced Clean Truck
Regulation.'' June 2020. Available online at: <a href="https://ww3.arb.ca.gov/regact/2019/act2019/nod.pdf">https://ww3.arb.ca.gov/regact/2019/act2019/nod.pdf</a>.
\92\ Buysse and Sharpe. (July 20, 2020) ``California's Advanced
Clean Trucks regulation: Sales requirements for zero-emission heavy-
duty trucks'', available online at: <a href="https://theicct.org/publications/california-hdv-ev-update-jul2020">https://theicct.org/publications/california-hdv-ev-update-jul2020</a> (last accessed August
11, 2021).
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E. Advance Notice of Proposed Rulemaking

The ANPR provided background for the provisions proposed in this
rulemaking to address criteria pollutant emissions from heavy-duty
engines, including technologies we are evaluating, test programs we
have initiated, and compliance programs under consideration, as well as
requests for comments and data. The ANPR did not include discussion on
the potential stringency of standards, potential costs of the
standards, or a quantitative assessment of societal impacts (e.g., air
quality, economic, environmental health); these topics are presented in
this proposal.\93\
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\93\ The ANPR also did not include the proposed, targeted
revisions to the HD GHG Phase 2 program that are included in this
rulemaking (see Section I.G for a summary of these proposed
provisions and Section XI for details).
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EPA received over 300 comments on the ANPR from a wide range of
stakeholders, including: Government organizations (state, local, and
Tribal), environmental groups, trade associations, heavy-duty engine
manufacturers, independent owner-operators, suppliers, individual
fleets, and individual private citizens. We provide a brief overview of
the perspectives included in these comments in this subsection, with
more specific discussion of comments included in subsequent sections of
the proposal as relevant to individual comments or groups of comments.
Comments from government organizations, including multiple state
and local air agencies, emphasized that reductions in NO<INF>X</INF>
emissions from heavy-duty engines are necessary for attainment and
maintenance of the NAAQS. States commented that they cannot control
heavy-duty engine emissions since they cross state borders and
controlling emissions from other sources would be economically
burdensome. Commenters stated that areas in nonattainment of the NAAQS
are having difficulty attaining, and some areas currently in attainment
are close to or exceeding the NAAQS. As further discussed in Section
II, commenters noted environmental justice and other public health
concerns, along with regional haze and ecosystem concerns. These
commenters requested stringent emission controls on heavy-duty engines
in as short a timeframe as possible (including early incentives) and
expressed widespread interest in ensuring control over the lifetime of
the engine, including addressing emissions from tampering and idling.
Several environmental groups submitted comments that were similar
to several of the state and local agency comments; environmental groups
supported stringent emission controls and maintaining that level of
emission control for longer durations by lengthening useful life and
emission warranty periods. These commenters further supported
improvements to the in-use testing program for heavy-duty diesel
engines, and anti-tampering measures for all heavy-duty engines.
Comments from the Truck and Engine Manufacturers Association (EMA),
a trade association for heavy-duty engine and truck manufacturers
emphasized broad support for a 50-state program and encouraged EPA to
conduct a thorough analysis of the costs and benefits of proposed
NO<INF>X</INF> emission standards. To emphasize their cost concerns,
EMA provided an industry-sponsored assessment of the cost to comply
with potential requirements discussed in the April 2019 CARB Staff
Whitepaper.\94\
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\94\ California Air Resources Board. ``California Air Resources
Board Staff Current Assessment of the Technical Feasibility of Lower
NO<INF>X</INF> Standards and Associated Test Procedures for 2022 and
Subsequent Model Year Medium-Duty and Heavy-Duty Diesel Engines''.
April 18, 2019. Available online: <a href="https://ww3.arb.ca.gov/msprog/hdlownox/white_paper_04182019a.pdf">https://ww3.arb.ca.gov/msprog/hdlownox/white_paper_04182019a.pdf</a>.
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Several truck owners, truck operators, fleets, and dealerships also
expressed general support for a national, harmonized low-NO<INF>X</INF>
program. Many commenters included their experiences with expensive
towing costs and downtime from emission system failures; they stated
that although the reliability of emission system controls has improved
since the 2010 timeframe, it remains an ongoing concern. ANPR
commenters also indicated that engine derates or ``inducements'' are a
significant source of operator frustration.\95\ In addition, commenters
urged EPA to conduct a thorough cost assessment, and noted that if the
initial purchase price, or operational costs for new trucks is too
high, then it may incentivize owners to keep older trucks on the road.
These commenters expressed varying views on lengthening emission
warranty requirements, with some urging a careful consideration of the
impacts of longer warranty requirements, while others expressed

[[Page 17436]]

support for longer warranty requirements.
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\95\ Engine derating is a control strategy that reduces engine
performance to protect the engine or induce an operator behavior,
such as maintaining appropriate levels of high-quality diesel
emission fluid (DEF) in their SCR-based aftertreatment systems.
Throughout this preamble we refer to engine derates that derive from
aftertreatment-related triggers as ``inducements''.
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Suppliers, supplier trade groups, and labor groups were all
generally supportive of more stringent NO<INF>X</INF> emission
standards. They also generally stated strong support for a 50-state,
harmonized EPA-CARB program. They also emphasized the importance of
providing industry with regulatory certainty. They noted that EPA must
balance emission reductions with technology costs, feasibility, lead-
time, and avoid market disruptions. Several suppliers and trade groups
provided detailed technical information on low NO<INF>X</INF>
technology. They also expressed support for longer useful life and
warranty requirements but cautioned EPA to carefully design longer
emissions warranty requirements and to consider a phase-in approach.
Several suppliers and trade groups also supported incentives for the
early introduction of low-NO<INF>X</INF> technology.
All of the ANPR comments are part of the docket for the proposal
and have informed our thinking in developing the proposed provisions to
address criteria pollutant emissions from heavy-duty engines.

F. EPA Statutory Authority for the Proposal

This section briefly summarizes the statutory authority for the
proposed rule. Title II of the Clean Air Act provides for comprehensive
regulation of mobile sources, authorizing EPA to regulate emissions of
air pollutants from all mobile source categories. Specific Title II
authorities for this proposal include: CAA sections 202, 203, 206, 207,
208, 213, 216, and 301 (42 U.S.C. 7521, 7522, 7525, 7541, 7542, 7547,
7550, and 7601). We discuss some key aspects of these sections in
relation to this proposed action immediately below (see also Section
XIV of this preamble), as well as in each of the relevant sections
later in this proposal. Regarding the confidentiality determinations
EPA is proposing to make through this notice and comment rulemaking for
much of the information collected by EPA for certification and
compliance under Title II, see Section XII.A. for discussion of
relevant statutory authority.
Statutory authority for the proposed NO<INF>X</INF>, PM, HC, CO,
and GHG emission standards in this action comes from CAA section 202(a)
which states that ``the Administrator shall by regulation prescribe
(and from time to time revise) . . . standards applicable to the
emission of any air pollutant from any class or classes of new . . .
motor vehicle engines, which in his judgment cause, or contribute to,
air pollution which may reasonably be anticipated to endanger public
health or welfare.'' Standards under CAA section 202(a) take effect
``after such period as the Administrator finds necessary to permit the
development and application of the requisite technology, giving
appropriate consideration to the cost of compliance within such
period.'' Thus, in establishing or revising CAA section 202(a)
standards designed to reduce air pollution that endangers public health
and welfare, EPA also must consider issues of technological
feasibility, compliance cost, and lead time. EPA may consider other
factors and in previous engine and vehicle standards rulemakings has
considered the impacts of potential standards on the heavy-duty
industry, fuel savings, oil conservation, energy security and other
energy impacts, as well as other relevant considerations such as
safety.
1. Statutory Authority for Proposed Criteria Pollutant Program
Section 202(a)(3) further addresses EPA authority to establish
standards for emissions of NO<INF>X</INF>, PM, HC, and CO from heavy-
duty engines and vehicles. Section 202(a)(3)(A) requires that such
standards ``reflect the greatest degree of emission reduction
achievable through the application of technology which the
Administrator determines will be available for the model year to which
such standards apply, giving appropriate consideration to cost, energy,
and safety factors associated with the application of such
technology.'' Section 202(a)(3)(B) allows EPA to take into account air
quality information in revising such standards. Section 202(a)(3)(C)
provides that standards shall apply for a period of no less than three
model years beginning no earlier than the model year commencing four
years after promulgation. CAA section 202(a)(3)(A) is a technology-
forcing provision and reflects Congress' intent that standards be based
on projections of future advances in pollution control capability,
considering costs and other statutory factors.96 97 CAA
section 202(a)(3) neither requires that EPA consider all the statutory
factors equally nor mandates a specific method of cost-analysis; rather
EPA has discretion in determining the appropriate consideration to give
such factors.\98\
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\96\ See National Petrochemical & Refiners Association v. EPA,
287 F.3d 1130, 1136 (D.C. Cir. 2002) (explaining that EPA is
authorized to adopt ``technology-forcing'' regulations under CAA
section 202(a)(3)); NRDC v. Thomas, 805 F.2d 410, 428 n.30 (D.C.
Cir. 1986) (explaining that such statutory language that ``seek[s]
to promote technological advances while also accounting for cost
does not detract from their categorization as technology-forcing
standards''); see also Husqvarna AB v. EPA, 254 F.3d 195 (D.C. Cir.
2001) (explaining that CAA sections 202 and 213 have similar
language and are technology-forcing standards).
\97\ In this context, the term ``technology-forcing'' has a
specific legal meaning and is used to distinguish standards that may
require manufacturers to develop new technologies (or significantly
improve existing technologies) from standards that can be met using
off-the-shelf technology alone. Technology-forcing standards such as
those in this proposed rule do not require manufacturers to use
specific technologies.
\98\ See, e.g., Sierra Club v. EPA, 325 F.3d 374, 378 (D.C. Cir.
2003) (explaining that similar technology-forcing language in CAA
section 202(1)(2) ``does not resolve how the Administrator should
weigh all [the statutory] factors in the process of finding the
`greatest emission reduction achievable' ''); Husqvarna AB v. EPA,
254 F.3d 195, 200 (D.C. Cir. 2001) (explaining that under CAA
section 213's similar technology-forcing authority that ``EPA did
not deviate from its statutory mandate or frustrate congressional
will by placing primary significance on the `greatest degree of
emission reduction achievable' '' or by considering cost and other
statutory factors as important but secondary).
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Section II, and Chapter 4 of the draft RIA, describe EPA's analysis
of information regarding heavy-duty engines' contribution to air
pollution and how that pollution adversely impacts public health and
welfare. Section I.G, with more detail in Section III and Chapter 4 of
the draft RIA, discusses our feasibility analysis of the standards and
useful life periods for both proposed Options. Our evaluation shows
that the standards and useful life periods in both steps of proposed
Option 1 are feasible and would result in the greatest emission
reductions achievable for the model years to which they are proposed to
apply, pursuant to CAA section 202(a)(3), giving appropriate
consideration to costs, lead time, and other factors. Our analysis
further shows that the standards and useful life periods in proposed
Option 2 are feasible in the 2027 model year, but would result in lower
levels of emission reductions compared to proposed Option 1. As
explained further in Section III and Chapter 3 of the draft RIA, we
expect that additional data from EPA's ongoing work to demonstrate the
performance of emission control technologies, as well as information
received in public comments, will allow us to refine our assessments
and consideration of the feasibility of the combination of the
standards and useful life periods, particularly for the largest CI
engines (HHDEs), in proposed Options 1 and 2, after consideration of
lead time, costs, and other factors. Therefore, we are co-proposing
Options 1 and 2 standards and useful life periods, and the range of
options in between them, as the options that may

[[Page 17437]]

potentially be appropriate to finalize pursuant to CAA section
202(a)(3) once EPA has considered that additional data and other
information. We considered costs and lead time in designing the
proposed program options, including in our analysis of how
manufacturers would adopt advanced emission control technologies to
meet the proposed standards for the applicable model years. For
example, the first step of proposed Option 1 allows manufacturers to
minimize costs by implementing a single redesign of heavy-duty engines
for MY 2027, which is when both the final step of the HD GHG Phase 2
standards and the first step of the proposed Option 1 standards would
start to apply. The second step of proposed Option 1 (MY 2031) would
provide manufacturers the time needed to ensure that emission control
components are durable enough for the proposed second step of revised
standards and longer useful life periods.99 100
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\99\ The second step of the proposed Option 1 standards in MY
2031 provides four years of stability following the first step of
the program.
\100\ See Section III for details on our proposed test cycles
and standards, and Section IV for our proposed compliance
provisions.
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As described in Section III, we are proposing new test cycles for
both pre-production and post-certification testing. Manufacturers
demonstrate compliance over specified duty cycle test procedures during
pre-production testing, which is conducted by EPA or the manufacturer.
These data and other information submitted by the manufacturer as part
of their certification application are the basis on which EPA issues
certificates of conformity pursuant to CAA section 206. Under CAA
section 203, sales of new vehicles are prohibited unless the vehicle is
covered by a certificate of conformity. Compliance with standards is
required not only at certification but throughout the useful life
period of the engine and vehicle, based on post-certification testing.
Post-certification testing can include both specific duty cycle test
procedures and off-cycle test procedures that are conducted with
undefined duty cycles either on the road or in the laboratory (see
Sections III.A and IV.K for more discussion on for testing at various
stages in the life of an engine).
As described in Section IV, we are proposing to lengthen regulatory
useful life and emission warranty periods to better reflect the
mileages and time periods over which heavy-duty engines are driven
today. CAA section 202(d) directs EPA to prescribe regulations under
which the useful life of vehicles and engines are determined and
establishes minimum values of 10 years or 100,000 miles, whichever
occurs first, unless EPA determines that a period of greater duration
or mileage is appropriate. EPA may apply adjustment factors to assure
compliance with requirements in use throughout useful life (CAA section
206(a)). CAA section 207(a) requires manufacturers to provide an
emissions warranty, which EPA last updated in its regulations for
heavy-duty engines in 1983 (see 40 CFR 86.085-2).\101\
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\101\ 48 FR 52170, November 16, 1983.
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2. Statutory Authority for Targeted Revisions to the Heavy-Duty GHG
Phase 2 Program
In addition, as discussed in Section XI, EPA is proposing a limited
set of revisions to MY 2027 Phase 2 GHG emissions standards under its
CAA section 202(a) authority described in this section (Section I.F).
We have developed an approach to propose targeted updates to HD GHG
Phase 2 standards that take into consideration the growing HD electric
vehicle market without fundamentally changing the HD GHG Phase 2
program as a whole. In addition, we are requesting comment on potential
changes to the advanced technology incentive program for electric
vehicles beginning in MY 2024.

G. Basis of the Proposed Standards

Our approach to further reduce air pollution from highway heavy-
duty engines and vehicles through the proposed program features several
key provisions. The primary provisions address criteria pollutant
emissions from heavy-duty engines. In addition, this proposal would
make targeted updates to the existing Heavy-Duty Greenhouse Gas
Emissions Phase 2 program, proposing that further GHG reductions in the
MY 2027 timeframe are appropriate considering lead time, costs, and
other factors, including market shifts to zero-emission technologies in
certain segments of the heavy-duty vehicle sector.
1. Basis of the Proposed Criteria Pollutant Standards
Heavy-duty engines across the U.S. emit NO<INF>X</INF>, PM, VOCs,
and CO that contribute to ambient levels of ozone, PM, NO<INF>X</INF>,
and CO; these pollutants are linked to premature death, respiratory
illness (including childhood asthma), cardiovascular problems, and

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