1

Design of Fuel Economy/Greenhouse Gas (GHG) Standards Learning from international experiences

Worldwide Automobile Efficiency/GHG Standards

2

Country/Region Regulated metric Program details, reduction in CO2-per-distance emissions

European Union# CO2 emissions (CO2/km) 40% reduction, MY 2008-2020 EU NEDC

United States Fuel economy (mi/gal) 42% reduction, MY 2010-2025

U.S. FTP GHG emissions (CO2e/mi)

Japan# Fuel economy (km/L) 30% reduction, MY 2010-2020 Japan JC08

China# Fuel consumption (L/100km) 14% reduction, MY2008-2015 EU NEDC cycle

Canada GHG emissions (CO2e/mi) 24% reduction, MY 2009-2016 U.S. FTP

South Korea Fuel economy (km/L) 12% reduction, MY 2012-2015

U.S. FTP CO2 emissions (CO2/km)

Mexico Fuel economy (km/L) 12% reduction, MY 2011-2016 U.S. FTP

India Fuel economy (km/L) 20% reduction, MY 2010-2020 NEDC for low powered vehicles

#: Separate standards established for light-commercial vehicles!

2

Slide 3

Comparison of passenger vehicle GHG standards

US 2025:109!Canada 2025:109!

EU 2020: 95!

Japan 2020: 105!China 2020: 117!

S. Korea 2015: 153!

Mexico 2016: 173!

40!

60!

80!

100!

120!

140!

160!

180!

200!

220!

240!

260!

2000! 2005! 2010! 2015! 2020! 2025!

Gra

ms

CO

2 p

er K

ilom

eter

no

rmal

ized

to

NE

DC

!

US-LDV!

Canada-LDV!

EU!

Japan!

China!

S. Korea!

Australia!

Mexico!

Solid dots and lines: historical performance!Solid dots and dashed lines: enacted targets !Solid dots and dotted lines: proposed targets!Hollow dots and dotted lines: target under study!

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Slide 4

Comparison of passenger vehicle GHG standards

EU 2011: 135!

EU 2020: 95!

US 2011: 217!

US 2025:109!Japan 2010:127!

Japan 2020: 105!

China 2010: 180!

China 2015: 167!

40!

60!

80!

100!

120!

140!

160!

180!

200!

220!

240!

260!

280!

2000! 2005! 2010! 2015! 2020! 2025!

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! EU! US-LDV! Japan! China!

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China 2020: 117!

Annual reduction rate %!

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3

Slide 5

Comparison of Light-Commercial vehicle GHG standards

Characteristics of Worldwide Standards

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Country/ Region

Regulated metric Attribute Form Categories, classes,

other provisions Fuel

Economy Fuel

Consumption CO2/GHG Weight Footprint Class Continuous Bins

European Union# X X X Eco-innovations,

super-credits

United States X X X X X 2WD, AC credit, FFV/E85, alternative fuels

Japan X X X Averaging within bins

China X X X X Transmission, per-vehicle limits à corporate average

Canada X X X X AC credits, alternative fuels

South Korea* X X X X Eco-innovations

Mexico X X X X

India X X X

#: CO2 standards complemented by Air-conditioning, tyre pressure monitoring, gear-shift indicators etc.!* : FE/CO2 standards include consideration for tyre pressure monitoring, gear-shift indicators !

4

7

http://www.theicct.org/blogs/staff/eu-car-manufacturers-likely-meet-2015-co2-target-early

8

50

75

100

125

150

175

200

500 750 1000 1250 1500 1750 2000 2250 2500 2750 3000

g C

O2/

km

Mass of the Vehicle in Running Order (kg)

EU 2015 and 2020 target curves

2020: T = 95 + 0.0333 *(M-M0)

2015: T = 130 + 0.0333 *(M-1372)

5

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Background: 2016 US Car and Truck Standards

§  Separate CO2-indexed car and truck standards (with separate slopes)!§  By statute (EPCA 1975, EISA 2007), NHTSA must set separate attribute-based car, truck

standards!§  Assuming no shifts in fleet composition and no trading à -24% gCO2e/mile from 2008-2016!

§  Cars and trucks would reduce gCO2e/mile by 23% and 26%, respectively, from 2008 to 2016.!§  Excluding 10.6 gCO2/mile from AC credits, CO2 reductions are 19% (cars) and 21% (truck)!

9 The equivalent lines for CAFE standards are slightly sloped (i.e., not perfectly linear) in fuel economy (mpg) space; note that EPA assumes some sales shift toward smaller car/trucks in 2016 timeframe in their analysis; in MY2012, 2WD SUVs shift from light truck to car category; the right y-axis is rated fuel economy after 10.6 g/mile A/C credits are utilized

Average 2008 car

Average 2008 truck

2017 and 2025 US Cars and Light-Truck Standards

10

100

150

200

250

300

350

400

35 40 45 50 55 60 65 70 75 80

Gre

enho

use

Gas

Em

issi

ons

(gC

O2e

/mile

)

Footprint (Sq. Ft)

2025 Cars

2025 L-T

2017 Cars

2017 L-T

1 Sq. meter = 10.764 Sq. feet

6

Japan’s “front runner” weight-based fuel economy standards

11

5

10

15

20

25

30

500 700 900 1100 1300 1500 1700 1900 2100 2300 2500

Fuel

Eco

nom

y in

km

/L (J

C08

cyc

le)

Vehicle Weight (kg)

Japan 2010, 2015 and 2020 Standards in JC08 km/L

2010

2015

2020

China Phase III standards based on corporate averaging

12

4

6

8

10

12

14

16

18

650 850 1050 1250 1450 1650 1850 2050 2250 2450 2650

Fuel

Con

sum

ptio

n (l/

100k

m)

Curb Weight (kg)

Dotted lines: Standards for automatic transmission, or more than two rows of seats Solid lines: Standards for manual transmission, and not more than two rows of seats

Phase II (limit values)

2006-2009

Phase III, (Corporate

Average Standard) 2012-2015

Phase I (limit values) 2004-2005

7

Canada 2011-2016 standards harmonized with US

13

150

200

250

300

350

400

450

3 3.5 4 4.5 5 5.5 6 6.5 7

GH

G E

mis

sion

s (g

CO

2e/m

ile)

Footprint (Sq. meter)

2012 Car Target

2016 Car Target

2012 L-T Target

2016 L-T Target

S. Korea has adopted dual FE and CO2 standards for 2015, phase-in from 2012

14

60

80

100

120

140

160

180

200

600 800 1000 1200 1400 1600 1800 2000 2200 2400

CO

2 Em

issi

ons

(g/k

m)

Curb Weight (kg)

2015 Standards line: CO2 = 140 + 0.0484*(M- 1423.2)

2015 target 140 g/km @ 1423.2kg

2010 average 158.3 g/km @ 1406kg

8

Mexico plans to harmonize with US standards by 2016

15

2011 Car Average, 3.73 m2, 156 g/km

2011 L-T Average, 4.64 m2, 228 g/km

100

120

140

160

180

200

220

240

260

3 3.5 4 4.5 5 5.5 6 6.5 7

CO

2 Em

issi

ons

(gC

O2/k

m)

Footprint (Sq. meter)

2013 Car Target

2016 Car Target

2013 L-T Target

2016 L-T Target

5.2

4.4 4.8

3

4

5

6

7

8

9

10

700 800 900 1000 1100 1200 1300 1400 1500 1600 1700 1800 1900 2000

Pet

rol E

quiv

alen

t Fue

l Con

sum

ptio

n (l/

100k

m)

Kerb Weight (kg)

Final 2015-16 Standard FC = 0.0024*CAKW+3.0034

Final 2020-21 Standard FC = 0.002*CAKW+2.4794

~ Five year payback ~ Two year payback

~ 16%

~ 20%

2009-10 trendline

India Proposed 2015-16 and 2020-21 standards. Manufacturers have asked to delay 2015-16 standards by one

year.

9

Brazil 2017 INOVAR-AUTO Tax Incentive

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174.4

100

120

140

160

180

200

220

240

700 900 1100 1300 1500 1700 1900 2100 2300

CO

2 Em

issi

ons

(E 2

2 FT

P75

in g

/km

)

Vehicle Mass (kg)

2017 INOVAR-AUTO Target MJ/km = 1.155 + 0.000593*M

~ 146 g/km CO2

2% additional tax reduction MJ/km = 1.067 + 0.000547*M

~ 135 g/km CO2

1% additional tax reduction MJ/km = 1.111 + 0.000570*M

~ 140 g/km CO2

Note: All CO2 values measured on FTP (City) cycle. Equivalent combined city-highway values will be ~12% lower.

Developments in other countries/regions on fuel efficiency standards..!

Slide 18

•  Australia is expected to unveil a regulatory impact assessment for 2015 and 2020 CO2 standards in December 2012!

•  Vietnam has drafted fuel efficiency standards for passenger vehicles as well as 2-3 wheelers, and a draft notification is expected by December 2012 as well.!

•  Russia and Indonesia will soon be the two of the largest markets without a fuel efficiency standards.!

10

For more information… §  ICCT Passenger Vehicles website:

http://www.theicct.org/passenger-vehicles §  Global Passenger Vehicle Standards Update:

http://www.theicct.org/global-passenger-vehicle-standards-update

§  US CAFE Standards: http://www.theicct.org/policies/us-cafe-standards

§  EU LDV CO2 Regulation: http://www.theicct.org/policies/eu-light-duty-vehicle-co2-regulation

§  Review and Comparative Analysis of Fiscal Policies to promote fuel economy: http://www.theicct.org/review-and-comparative-analysis-!scal-policies

§  CO2 Standards: http://www.theicct.org/issues/co2-standards

Anup Bandivadekar anup “at” theicct.org

John German

John “at” theicct.org

Peter Mock Peter “at” theicct.org

Hui He

Hui “at” theicct.org

http://twitter.com/#!/theicct

Slide 19