Center for Energy Efficiency and Renewable Technologies
Providing global warming solutions for California and the West.
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clean transportation and alternative fuels
Gasoline and diesel transportation fuels represent a major share of America’s most pernicious air pollution, water-borne toxins, and climate emissions. CEERT has been working to clean up CO2 from cars and trucks, promote electric and hydrogen fuel-cell vehicles and their recharging/refueling infrastructure, and bring about smarter transportation and development planning.
Advanced Clean Cars (ACC)
The Federal Reset
On April 12 the US-EPA released its proposed updates to the regulations setting new emissions standards to reduce GHGs and criteria pollutants produced by passenger cars and trucks for the 2026 through 2032 model years (MY). The regulations propose to increase the stringency of both the criteria pollutants and GHG emissions standards, and to set durability requirements for light-duty electrified vehicle batteries and warranty provisions for both electric and diesel vehicles. (In this proposal, the EPA redefines light-heavy-duty vehicles (LDVs) and heavy-duty pickups and vans as “medium-duty vehicles” (MDVs).)
In the past the EPA based its requirements for how automobile manufacturers (OEMs) could meet the increased stringency of pollution emission standards primarily through improvements in the performance of internal combustion engine (ICE) powertrains. However, the new proposed regulations rely on the increasing development and availability of zero and near-zero emission vehicles (ZEVs and plug-in hybrids) as a cost-effective compliance technology path.
If the OEMs were to meet the progressively increasing stringency in the new proposed standards from the 2026 MY to the 2032 MY, industry-wide average tailpipe GHG emissions would be reduced by 56% for the LDV fleet and by 44% for the MDV fleet. The EPA’s proposed criteria pollution standards would progressively reduce non-methane organic gases plus nitrogen oxides from the existing standard for the 2025 MY by 60%, and could effectively reduce tailpipe particulate matter (PM) emissions from ICE vehicles by more than 95%.
The proposed standards are projected to accelerate the transition to electric vehicles. Depending on the compliance pathways manufacturers select, EPA projects that EVs could account for 67% of new light-duty vehicle sales and 46% of new medium-duty vehicle sales by the 2032 MY.
Along with proposed Phase 3 GHG Standards for Heavy-Duty Vehicles, EPA estimates the regulations could avoid nearly 10 billion tons of CO2e emissions through 2055, equivalent to more than double the total US 2022 CO2e emissions, and reduce oil imports by some 20 billion barrels. EPA also estimates that the standards, through reduced fuel and maintenance costs, would save the average consumer $12,000 over the lifetime of an LDV, and provide net benefits to the U.S. economy that would exceed costs by at least $1 trillion while also yielding positive public health outcomes through reduced illness, morbidity and mortality, especially for those suffering from respiratory and cardiovascular illnesses.
Environmental, environmental justice, and public health NGOs are broadly supportive of these proposed standards. However, these groups are also advocating that the EPA set the strongest regulations possible, and maximize the inclusion of ZEVs. EPA could accomplish this by aligning its approach as much as possible with California’s updated Advanced Clean Cars regulations, and by seeking a further 10 grams/mile reduction in CO2e emissions and requiring the elimination of any criteria pollutant emissions by 2035. If EPA were to do that, it would eliminate tailpipe pollution, and by 2050 would avoid more than 11 billion tons of climate pollution, nearly 100,000 premature deaths, save consumers over $5,000 in average vehicle lifetime costs, and stimulate increased well-paying employment.
On April 20 a Zero-Emission Vehicle Infrastructure Joint Statement of Intent was announced, detailing how eight state departments and agencies will coordinate planning, funding, and implementation to ensure that the needed facilities, grid and energy supply, and EV charging and hydrogen fueling infrastructure are put in place to successfully realize California’s ZEV future.
A Continent Uniting
The deadline for submissions on the Canadian Government’s ZEV regulations closed on March 16, and staff at Environment and Climate Change Canada (ECCC) will be drafting the final version of the regulations, which will be issued in the late fall or early winter. A continuing concern of CEERT and our Canadian public health, environmental and ZEV-industry NGO partners (Canadian ZEV Coalition) remains ECCC’s proposal to only require a national target for the ZEV mandate. The Coalition believes that British Columbia, Québec and Ontario provinces can be attractive major markets for future ZEV sales, and we continue to urge the Canadian federal government to include regional targets to ensure a truly national market for ZEVs.
Future ECCC Staff work on the ZEV regulations will be informed by the new ZEV Council, which was launched in late March by Transport Canada (TC), a federal department. The Council comprises 42 organizations, and will be a key venue for advancing Canada’s ZEV sales targets and GHG reduction goals. (Ensuring that the Canadian electrical grid is prepared to support a massive deployment of EVs is being addressed at the Canada Electricity Advisory Council). The ZEV Council has taken up the issue of establishing regional sales targets to ensure a smoother overall national ZEV transition.
Parallel International Developments
The European Union’s newly proposed EU 7 vehicle emissions standards remain on hold since the postponement of a planned March 7 vote. Fourteen countries are now opposing the regulations due to concerns about the rules’ impacts on employment and local industry, and want to delay the new standards for at least three years for cars and five years for trucks. And a renewed lobbying effort by the European auto industry claims that the costs of complying with the regulations are too high and the timeline is too aggressive, unachievable, and even unnecessary. In response, a coalition of seven health, consumer and environmental organizations are defending the proposal.
Two key committees are to finalize proposed revisions by September. It appears that fashioning and approving a revised set of Euro 7 regulations could take until the first quarter of 2024.
Clean Truck Regulations
Advanced Clean Fleet Regulation
On April 28 CARB approved its Advanced Clean Fleets (ACF) regulation, which will reinforce the Advance Clean Truck regulation and help accelerate the transition to zero-emission medium- and heavy-duty vehicles. CEERT and our colleagues in the ACF Coalition participated in drafting the regulation.
While the rule allows fleet operators to continue operating existing vehicles through their useful life, it requires those operating vehicles for private services, federal fleets such as the Postal Service, and state and local government fleets to begin their transition to zero-emission vehicles in 2024.
Vehicles such as drayage trucks that have a disproportionate impact on residents living along transportation corridors will need to be zero-emission by 2035. Other fleets can transition a progressively increasing percentage of their vehicles to meet interim zero-emission targets, preserving the owners’ flexibility during the transition and balancing the availability of technology with the need to target the most polluting vehicles first. (About 150 models of medium- and heavy-duty zero-emission trucks are commercially available in the U.S. today.) The ACF requires that ICE truck sales in California end in 2036.
CARB estimates that as a result of the regulation there will be about 1.7 million zero-emission trucks on California’s roads in 2050. CARB also estimates that the ACF will yield $26.6 billion in health savings from reduced asthma attacks, emergency room visits and respiratory illnesses, while saving fleet owners an estimated $48 billion in operating costs over the California fleets’ transition through 2050.
Advanced Clean Trucks Rule
On June 5, in response to the US-EPA granting California a waiver to transition its fleet of medium- and heavy-duty trucks to all zero-emissions trucks by 2045, 19 states led by Iowa filed a lawsuit in the U.S. Court of Appeals for the District of Columbia Circuit against the EPA’s issuance of the waiver.
The lawsuit’s rationale appears to be that the waiver opens the door for other states to adopt California’s zero-emission truck (ZET) requirements. That development would create a critical mass in the market that would force manufacturers to switch most or all of their production to ZETs because it would be either too costly for them or they would lack the capacity to meet demand for both ICE trucks and ZETs. This would effectively mean that California would be imposing a national mandate for the entire country to move to ZETs. The suit hinges on the legal theory that, in allowing California to essentially set national environmental policies, the EPA’s granting of the waiver is a violation of the U.S. Constitution’s equal sovereignty doctrine because it subjects states to unequal burdens.
On July 21 the Court agreed to allow 18 states backing the waiver to participate as intervenors in the suit.
Low-NOx Omnibus Rule
CARB is still awaiting approval of its waiver by the US-EPA, which was filed with the Secretary of State on December 22, 2021. However, it is not yet clear how the recently announced Clean Truck Partnership agreement (see immediately below) will affect the waiver process.
CARB Agreement with the Clean Truck Partnership
On July 6, CARB announced its binding agreement with an industry coalition comprising leading truck manufacturers and the Truck and Engine Manufacturers Association (the Clean Truck Partnership). The agreement’s intent is to give the trucking industry flexibility in meeting California’s emissions requirements while preserving the state’s ability to meet its climate and emission reduction goals.
The terms of the Clean Truck Partnership agreement include these provisions:
- CARB will align with EPA’s 2027 regulations for nitrogen oxide emissions. CARB also will modify elements of the 2024 NOx emission regulations for which manufacturers will provide offsets as necessary to maintain California’s emission targets.
- CARB commits to providing no less than four years’ lead time and at least three years of regulatory stability before imposing new requirements.
- Truck manufacturers commit to meeting CARB’s zero-emission and criteria pollutant regulations in the state regardless of any attempts by other entities to challenge California’s authority.
CEERT and some of our partners in the Advanced Clean Truck Coalition have shared our concerns with CARB Staff about the implications of the agreement for NOx emissions, which could increase as a result of CARB aligning its Low-NOx Omnibus with the weaker EPA standards finalized in December 2022. We will continue to meet with CARB Staff to discuss the implementation of this Partnership agreement and to have them address our concerns.
Federal Clean Truck Regulations
On April 12, the US-EPA released Greenhouse Gas Standards for Heavy-Duty Vehicles – Phase 3. These proposed regulations apply to heavy-duty vocational vehicles and trucks used to haul freight, and set progressively increased stringency standards for GHG emissions for the 2027-2032 MYs. EPA anticipates that the Phase 3 rules will accelerate the development and deployment of the zero-emission truck and bus market in the U.S. (Unlike California’s Clean Truck regulations, the federal regulations will not require that all new trucks sold eventually be ZETs.) The EPA estimates that, through 2055, the proposed regulations will yield 1.8 million metric tons of avoided CO2e emissions (equivalent to the current annual GHG emissions from the entire U.S. transportation sector), 72,000 tons of nitrogen oxides emissions, $250 billion in reduced vehicle operating costs, and net social benefits equivalent to $320 billion.
Environmental, environmental justice, and public health NGOs (including some CEERT affiliates) are advocating that the Rules for heavy-duty trucks go farther: for the EPA to revisit its criteria-emissions targets, be more ambitious with its Phase 3 GHG rule, and model its Clean Truck Regulations to be more aligned with CARBs Advanced Clean Truck, Low-NOx Omnibus, and Advanced Clean Fleet regulations.
These organizations are also strongly advocating for EPA to put greater emphasis on reducing the impacts of trucks on residents living along major transportation corridors, to require the use of ZETs rather than ICE trucks using natural gas or hydrogen, and to set a target requirement of 100% ZET sales by 2035. One analysis estimated that an all-ZETs-by-2035 regulation could result in 1.05 – 2.1 million ZEV trucks being on the nation’s roads by 2032, and deliver a 50% reduction in CO2e emissions, $115 billion in climate benefits, and $63 billion in public health benefits (relative to 2026) by 2040, while giving owners $86,000 in savings for an HDV purchased in the 2032 MY and benefiting utility customers with improved grid efficiencies from the integration of ZEV trucks’ charging infrastructure.
Clean Trucks in Canada
While Canada continues to provide incentives and funding to build industry awareness, it has yet to launch a rulemaking process for achieving the goal it has long rhetorically committed to of developing “… a medium- and heavy-duty zero-emission vehicle regulation to require 100% of new medium- and heavy-duty vehicle sales to be zero-emission vehicles by 2040 for a subset of vehicle types based on feasibility, with interim 2030 regulated sales requirements that would vary for different vehicle categories based on feasibility, and explore interim targets for the mid-2020s.” In the interim, some of the informal work that will guide development of the regulations will likely occur in the ZEV Council (see above).
Clean Transportation Investments
On April 24 the California Energy Commission released its Staff Draft for its proposed Clean Transportation Program 2023–2024 Investment Plan Update. A first meeting of the Advisory Committee for the Clean Transportation Program to discuss the 2023–2024 Investment Plan Update was held on April 27, with CEERT participating. The Staff Draft Proposal is recommending that the Clean Transportation Program provide $1.7 billion in funding at the following levels for Fiscal Years 23/24 – 25/26:
- Light-Duty EV Charging Infrastructure – $634 M (constituting $13.8 million in AB 118 Program funding and $370 million from General Funds per the State Budget).
- Medium- and Heavy-Duty ZEV Infrastructure – $954 M ($13.8 million in Program funding and $645 million from State General Funds)
- Hydrogen Refueling Infrastructure – $ 70 million ($10 million in Program funding and $60 million from State General Funds)
- Emerging Opportunities – $46 million from State General Funds
- Low-Carbon Fuels – $5 million in Program funding
- ZEV Workforce Development – $5 million in Program funding
Advisory Committee members were strongly supportive of the Staff’s proposal and how efficiently it balanced the allocations to each of the ZEV transportation segments, especially for their expansion in disadvantaged communities. The Lead Commissioner’s Report on the Investment Plan Update will be considered for approval by CEC Commissioners in their December 13 business meeting.
The funding for this program, and for the parallel Air Quality Improvement Program (which together with the Low Carbon Transportation Investment Plans constitutes CARB’s Clean Transportation Incentives Program) expires on January 1, 2024. Legislation to extend these programs and their annual funding is currently making its way through the legislature.
On April 24 CARB held a Public Workgroup meeting on the 2023-2024 Clean Transportation Incentives for Low Carbon Transportation Investments and the Air Quality Improvement Program. It has since conducted a series of monthly community meetings and community surveys to help Staff better understand what investment priorities and policies communities would like to see. Public Work Group meetings for each of the component funding projects of the program began on August 1.
On June 27 Governor Newsom signed into law legislation enacting California’s $310 billion Fiscal Year 2023-24 State Budget as part of an agreement with legislative leadership to support a suite of associated budget trailer and policy bills. The multiyear commitment to fund climate programs suffered a 5% cut of $2.9 billion, but retains $51.4 billion of $54.3 billion that was initially established in the 2021 and 2022 state budgets. (This cut is significantly less than the $6 billion cut the governor had proposed in January or the $5 billion cut in a June 15 budget proposal approved by the Legislature.)
Partly through efforts of the NGO ZEV Budget Coalition, the final budget retains $10 billion for meeting the state’s ZEV mandate that the Governor had originally proposed cutting. The deal also allocates $5.1 billion over four years for public transit, while allowing transit agencies the flexibility to use the money for operations as well as construction, subject to accountability measures and state oversight. Many in the environmental community remain concerned that the cuts in climate funding will hamper California’s ability to meet its GHG and criteria air pollution reduction targets.