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NHTSA issues Environmental Impact Statement scoping notice for MY 2022-2025 CAFE standards; seeking comments on “preferred alternative”

In March, EPA Administrator Scott Pruitt and Department of Transportation Secretary Elaine Chao announced that EPA intends to reconsider its final determination issued on 12 January 2017 which recommended no change to the greenhouse gas standards for light duty vehicles for model years 2022- 2025. (Earlier post.) EPA will reconsider that determination in coordination with NHTSA as part of a renewed Mid-Term Evaluation process.

Now, as part of its own MY 2022-2025 fuel economy standards process, NHTSA has issued its Notice of Intent to Prepare an Environmental Impact Statement (EIS) for Model Year 2022–2025 Corporate Average Fuel Economy (CAFE) Standards. The EIS will analyze the potential environmental impacts of new CAFE standards for model year 2022–2025 passenger cars, light trucks, and medium-duty passenger vehicles which the agency will propose in a forthcoming Notice of Proposed Rulemaking (NPRM).

NHTSA will prepare the EIS as specified by the National Environmental Policy Act (NEPA), which requires Federal agencies to consider the potential environmental impacts of their proposed actions and those of possible alternative actions. The Draft EIS will be released simultaneously with the NPRM.

Background. In 2012, NHTSA and EPA issued a final rule setting CAFE and GHG emissions standards for passenger cars and light trucks for model years 2017 and beyond. NHTSA developed two phases of passenger car and light truck standards. The first phase, covering MYs 2017–2021, included final standards that were projected to require, on an average industry fleet-wide basis, a range from 40.3-41.0 mpg in MY 2021.

The second phase of the CAFE program, covering MYs 2022–2025, included standards that were not final, due to the statutory requirement that NHTSA set average fuel economy standards not more than five model years at a time. Those 2022-2025 standards were “augural”—i.e., they represented the best estimate, based on the information available at that time, of what levels of stringency might be the maximum feasible in those model years.

NHTSA projected that those standards could require, on an average industry fleet wide basis, a range from 48.7–49.7 mpg in model year 2025. NHTSA is statutorily required to issue a final rule for MY 2022 CAFE standards no later than 1 April 2020. As part of this rulemaking, NHTSA may evaluate the MY 2021 standards it finalized in 2012 to ensure they remain “maximum feasible.”

With the EPA’s recent declaration that it will reconsider the final determination on light-duty GHGs for MYs 2022-2025, the two agencies will be working again on a potentially revised, harmonized national program for those model years.

The EIS. Although NHTSA evaluated the impacts of the augural standards in its EIS accompanying the MY 2017–2025 rulemaking, NHTSA will prepare a new Draft EIS and Final EIS as part of this de novo rulemaking to provide for fresh consideration of all available information.

As in the previous CAFE rulemaking, NHTSA plans to propose vehicle footprint as the attribute. Standards will be defined as footprint “curves” for passenger cars and light trucks in each model year, where vehicles of different footprints have specific fuel economy targets, with larger vehicles (and light trucks) generally having lower fuel economy targets than smaller vehicles (and passenger cars), reflecting their fuel economy capabilities.

The shape and stringency of the curves will reflect, in part, NHTSA’s analysis of the technological and economic capabilities of the industry within the rulemaking timeframe. A manufacturer’s individual CAFE standards for cars and trucks, in turn, would be based on the target levels set for the footprints of its particular mix of cars and trucks manufactured in that model year.

A manufacturer with a relatively high percentage of smaller vehicles would have a higher standard than a manufacturer with a relatively low percentage of smaller vehicles. Compliance will be determined by comparing a manufacturer’s harmonically averaged fleet fuel economy level in a model year with a required fuel economy level calculated using the manufacturer’s actual production levels and the targets for each vehicle it produces.

Of note, the Energy Independence and Security Act of 2007 (EISA), which guides the current set of CAFE rules, required NHTSA to “prescribe annual fuel economy standard increases that increase the applicable average fuel economy standard ratably beginning with model year 2011 and ending with model year 2020.” For MY 2021-2030 passenger cars and light trucks, EISA does not set a target fuel economy or require that standards “increase...ratably” over the period.

NHTSA is considering the following alternatives for analysis in the Draft EIS:

  • No action. The baseline alternative, this assumes, for purposes of NEPA analysis, that NHTSA would issue a rule that would continue the current CAFE standards for MY 2021 indefinitely.

  • Action alternatives represented by calculating a lower bound and upper bound of a range of reasonable annual fuel economy standards, from MY 2022 forward. The calculations and the related evaluation of impacts would be performed separately for passenger cars and light trucks.

  • The preferred alternative, reflecting annual fuel economy standards for both passenger cars and light trucks that fall at or between the upper and lower bounds identified above. NHTSA has not yet identified its preferred alternative.

NHTSA is seeking comments on how it should define and balance the statutory criteria to choose the preferred alternative, given the statutory requirement of setting “maximum feasible” fuel economy standards.

Thus, NHTSA plans to analyze the impacts of eight different standards in the Draft EIS: two bracketing the possible action alternatives for passenger cars; two bracketing the possible alternatives for light trucks; a No Action Alternative and a preferred alternative for passenger cars; and a No Action Alternative and a preferred alternative for light trucks.

The range of alternatives will reflect differences in the degree of technology adoption across the fleet, in costs to manufacturers and consumers, and in conservation of oil and related impacts to the environment. For example, the most stringent average annual fuel economy standard NHTSA will evaluate would require greater adoption of fuel-saving technology across the fleet, including more advanced technology, than the least stringent average annual fuel economy standard NHTSA will evaluate. As a result, the most stringent alternative would impose greater costs and achieve greater energy conservation.

—Notice of Intent

NHTSA will analyze environmental impacts related to fuel and energy use, emissions and their effects on climate change and the environment, air quality, natural resources, and the human environment. To account for uncertainty in estimating the potential impacts related to climate change, NHTSA plans to evaluate a range of potential global temperature changes that may result from changes in fuel and energy consumption and GHG emissions attributable to new CAFE standards.

It is difficult to quantify how the specific impacts due to the potential temperature changes attributable to new CAFE standards may affect many aspects of the environment. NHTSA will endeavor to gather the key relevant and credible information using a transparent process that employs the best available peer-reviewed science and economics. NHTSA invites public comments on the scope of its analysis on climate change impacts, including citations to peer-reviewed scientific articles to frame and analyze the relevant issues.

—Notice of Intent

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