This rulemaking is an opportunity for the Board to commit to the transformation of California’s light-duty vehicle fleet. As the technology Advanced Clean Car (ACC) package, the ZEV regulation along with new LEV III smog-forming pollutant and GHG standards can be the catalyst to that transformative process.

—ARB staff

In addition, the Advanced Clean Cars program includes amendments to California’s Clean Fuels Outlet regulation to ensure that ultra-clean fuels such as hydrogen are available to meet vehicle demands brought on by the ZEV program.

Low Emission Vehicle Program

The Low Emission Vehicle Program (LEV) has two elements: more stringent regulations for criteria pollutants (enhancements to the older LEV program, i.e., LEV-III) and the GHG regulations.

LEV-III. Major components in the new LEV-III element include:

• A reduction of fleet average emissions of new passenger cars (PCs), light-duty trucks (LDTs) and medium-duty passenger vehicles (MDPVs) to super ultra-low-emission vehicle (SULEV) levels by 2025. (This corresponds to US EPA Tier 2 Bin 2.)

• The replacement of separate NMOG and oxides of nitrogen (NO_x) standards with combined NMOG plus NO_x standards.

• An increase of full useful life durability requirements from 120,000 miles to 150,000 miles, which guarantees vehicles operate longer at these extremely low emission particulate levels.

• A backstop to assure continued production of super ultra-low-emission vehicles after PZEVs as a category are moved from the Zero-Emission Vehicle program to the LEV program in 2018.

• More stringent particulate matter (PM) standards for light- and medium-duty vehicles.

• Zero fuel evaporative emission standards for PCs and LDTs, and more stringent evaporative standards for medium-duty vehicles (MDVs).

ARB says it intends to provide vehicle manufacturers with sufficient lead time as well as compliance flexibility to implement new technologies across their vehicle lines both from a feasibility and cost-effectiveness standpoint.

ARB staff anticipates that ongoing improvements to the effectiveness of a wide range of emission control technologies already in use—particularly catalyst technology—will enable OEMs to meet the proposed requirements for smog forming emissions under the LEV-III element.

Heavier vehicles with larger displacement engines will likely require additional emission control equipment such as secondary air and hydrocarbon absorbers to achieve the proposed emission levels.

Assuming all new vehicles meet the SULEV standards in 2025, ARB staff calculated that the average incremental cost per passenger car and smaller light truck (up to 8,500 lb.: PC/LDT1) would be $60; the incremental cost for LDT 2 (8,500 to 10,000 lb.) would be $135. Average cost per vehicle across the entire fleet would be $86.

Staff based its analysis on additional technology required to reduce NO_x and NMOG. Particulate matter reductions will be met by engine modifications during the normal course of engine development, they concluded, and so there is no incremental increase in vehicle price in that area.

Greenhouse gas emission standards. For the 2017-2025 model year standards, ARB proposes to use the US Environmental Protection Agency (EPA) approach and adopt separate standards for CO₂, CH₄, and N₂O. The proposed GHG emission standards would reduce new passenger vehicle CO₂ emissions to about 166 g/mile—a 34% reduction from MY 2016 levels—based on the projected mix of vehicles sold in California.

The two categories in the standard—passenger cars and light trucks— are also consistent with the Federal categories. The standard targets a reduction of about 36% for cars and about 32% for trucks from MY 2016 through MY 2025.

The CH₄ and N₂O standards will reflect the same stringency as the original GHG standards. In addition, California is proposing to align its vehicle air conditioning system requirements with Federal requirements.

ARB predicated the proposed GHG standards on many existing and emerging technologies that increase engine and transmission efficiency, reduce vehicle energy loads, improve auxiliary and accessory efficiency, and recognize increasingly electrified vehicle subsystems with hybrid and electric drivetrains.

The new rulemaking builds on an existing technical foundation with new technical data and the understanding of evolving advanced engine, transmission, hybrid, and electric-drive technologies. As part of this effort, and without conceding any of California’s separate authority, staff has been working with the USEPA and the National Highway Transportation Safety Administration (NHTSA) since early last year to develop a unified national GHG program for motor vehicles beyond 2016. ARB emphasizes that while California proposes accepting national program compliance as an option for manufacturers, California is only doing so because it believes the proposed standards are stringent enough to meet State GHG emission reduction goals.

ARB staff proposes that many of the technologies that reduce climate change emissions will also reduce the operating costs of light-duty vehicles. Estimates of the average reduction in operating costs of the new vehicles range from about 4% for model year (MY) 2017 vehicles, to more than 25% for MY2025 vehicles. For every dollar spent, the regulation could save consumers about $3, ARB staff calculates. These savings include the expenditures on electricity and hydrogen associated with operating the greater volume of ZEVs being proposed.

This increase in operational savings, according to ARB, will more than offset the incremental price of the vehicle caused by the advanced technology. In ARB’s calculations, the average increase in price in MY2025 vehicles will be $1,900; this in turn will be offset by net lifetime savings of $4,000, resulting in a $12 net monthly savings and a payback in 2.9 years.

Zero Emission Vehicle Program

California first implemented a ZEV program in 1996. At its last review of the program, the Board directed ARB staff to strengthen the requirement over the current program and focus primarily on the zero emission drive technologies: battery-electric, hydrogen fuel-cell and plug-in hybrid technologies.

Expected ZEV regulation compliance for 2018 through 2025 model years. Click to enlarge.

Staff is proposing two sets of changes: amendments through MY 2017, and then regulations for MY 2018 and following. Changes through MY 2017 are intended to make minor mid-course corrections and clarifications, and to enable manufacturers to meet the 2018 and subsequent requirements.

The modifications through 2017 include compliance flexibility and and adjustment in credits and allowances. The latter includes more credits for Type V (300 mile FCV) ZEVa to incentivize appropriately this longer term technology. A Type H advanced technology partial zero emission vehicle (PZEV) allowance will give appropriate credit for BEV-like plug-in hybrid electric vehicles (PHEV).

The goal for 2018 and subsequent model years is to achieve broader ZEV and transitional zero emission vehicle (TZEV; most commonly a plug-in hybrid electric vehicle) commercialization through simplifying the regulation and pushing technology to higher volume production in order to achieve cost reductions.

The amendments here include:

• Increased requirements which push ZEVs and plug-in hybrids to about 15.4% of new sales by 2025.

• Remove PZEV (near-zero emitting conventional technologies) and advanced technology partial zero emission vehicles (AT PZEV, typically non-plug-in hybrids) credits as compliance options for manufacturers because these technologies are now commercialized.

• Amend Intermediate and Large Volume Manufacturer (LVM) size definitions to bring all but the smallest manufacturers under the full ZEV requirements by model year 2018; and change the percentage of ownership for combining manufacturers. These changes result in applying the ZEV regulation to manufacturers that represent 97% of the light duty vehicle market.

• Staff proposes to end the travel provision for BEVs—which allows ZEVs placed in any state that has adopted the California ZEV regulation to count towards the ZEV requirement in California—after model year 2017. Staff also proposes extending the travel provision for fuel cell vehicles (FCVs) until sufficient complementary polices are in place in states that have adopted the California ZEV regulation. This is intended to allow FCV technology to continue to mature, and provide time for states that have adopted California’s ZEV regulation to build infrastructure and put in place incentives to foster FCVs.

• Allow manufacturers who systematically over-comply with the proposed greenhouse gas fleet standard to offset a portion of their ZEV requirement in 2018 through 2021 model years only.

As a result of its proposal, ARB staff expects more than 1.4 million ZEVs and TZEVs to be produced cumulatively in California by 2025, with 500,000 of those vehicles being pure ZEVs (BEVs and FCVs).

Clean Fuels Outlet (CFO) Regulation

The final component of the ACC package is the Clean Fuels Outlet regulation, which requires the construction of alternative fuel outlets for a particular fuel when there are 20,000 alternative fuel vehicles (AFVs) using that fuel.

The Board is proposing changes to this program now in order to address the pending commercialization of zero-emission hydrogen fuel cell vehicles. Proposed changes include streamlining the compliance requirements; adding a lower regional activation trigger (i.e., a 10,000-vehicle activation trigger that would apply to an air basin before the statewide trigger of 20,000 is reached); applying it to zero emission vehicles (ZEVs) and ZEV fuels only; adding a regulatory review for plug-in electric vehicles; changing the regulated party to be the major producer/importers of gasoline; and lowering the regulation sunset provision.

ARB staff anticipates that the economic impacts of the regulation will mainly be felt during the onset, when hydrogen stations are expected to be less than fully utilized. With high station utilization, fuel providers will be able to sell hydrogen at an affordable price and realize a return on their investment within three to four years, according to the staff analysis.

Offering hydrogen fuel in convenient commercial settings is critical to the successful launch of zero emission vehicles, which will be the cornerstone of long term health based criteria pollutant and climate change emission reduction goals.

Resources

• Advanced Clean Cars Summary