420R78100 Evaporative Emission Regulations for Light Duty Vehicles and Trucks (2 gram standard): Environmental and Economic Impact Statement Revised Evaporative Emission Regulations for the 1981 Model Year uJl \K ¦ fs . AND FUEL EMlSbiUNo LABOR A i OH "i LIBRARY 2000 TRAVERWOOD DRIVE ANN ARBOR. Ml 48105 xvEPA United States Environmental Protection Agency ------- Evaporative Emission Regulations for Light Duty Vehicles and Trucks (2 gram standard): Environmental and Economic Impact Statement Revised Evaporative Emission Regulations for the 1981 Model Year Mobile Source Air Pollution Control Office of Air and Waste Management U.S. Environmental Protection Agency United States Environmental Protection Agency EPA-420-R-78-100 August 1978 ------- Environmental and Economic Impact Statement Revised Evaporative Emission Regulations for the 1981 Model Year Environmental Protection Agency Office of Air and Waste Management, Mobile Source Air Pollution Control Approved by: Date ------- Contents pafte I. Summary 1 A. Background and Description of i This Action B. Environmental Impact 2 C. Economic Impact 3 1. Character of the Industry 3 2. Impact on Consumers 3 3. Impact on Industry 4 4. Government Costs 4 5. Cost Effectiveness 4 D. Alternative Actions II. Introduction 6 A. Need for Control, Background and Description of This Action 5 B. Alternative Actions Considered 10 C. Structure of Report 14 III. Description of LDV, LDT Industry 16 A. Definition of Product 15 B. Structure of the Industry (Pro- 17 duction and Marketing) C. Sales and Revenues 24 D. Employment 27 ------- IV. Environmental Impact 28 A. Primary Impact 28 1. Current and Projected Emission Factors 29 2. Vehicle Population and Vehicle Usage 33 3. Nationwide Emissions 39 4. Impact on Some Regions 45 B. Secondary Environmental Impacts 49 1. Energy Consumption 52 2. Hydrocarbon Reactivity 53 3. Exhaust Hydrocarbon Emission Interaction 54 4. Water Pollution and Solid Wastes 54 V. Costs of Control and Its Impact on Consumers, 55 Industry and Government A. Impact on Consumers 55 1. Initial Costs 55 2. Fuel Consumption 59 3. Maintenance Costs 60 B. Impact on Industry 60 1. Sales 60 2. Competitive Structure 62 3. Developmental and Certification Costs 62 4. Potential Impact on Employment 65 C. Government Costs 65 D. National Annualized Cost and Capital 65 Investment over 5 Years VI. Cost Effectiveness 67 VII. Other General Considerations 72 A. Irreversible and Irretrievable 72 Commitment of Resources B. Relationships of Short-Term Uses of the Environment and Maintenance and Enhancement of Long-Term Productivity 72 ------- Problems and Objections Raised by Federal, State and Local Agencies, and Other Persons ------- Chapter I Summary A. Background and Description of this Action This regulation establishes a 2.0 g/test evaporative emission level for 1981 and subsequent model year vehicles using the Federal Evaporative Emission Test Procedure implemented for 1978 MY evaporative emission testing. On January 13, 1976 a Notice of Proposed Rule Making (NPRM) was published in the Federal Register (41 FR 2022), setting forth proposed amendments to Subparts A and B of Part 86 of the Code of Federal Regula- tions (CFR) to become effective for 1978 model year light-duty vehicles and light-duty trucks. The NPRM announced the agency's intention to revise the evaporative emission test procedures and establish standards of 6.0 g/test for 1978 and 2.0 g/test for 1979 and subsequent model years. The issue of a 2.0 gram per test standard is considered more complex than the revised test procedures and the 1978 standard. The 1978 standard represented so large (about 70%) of a reduction from 1972-77 light-duty vehicle and truck evaporative emission levels that the real risk of not being able to implement it for 1978, due to the additional time necessary to thoroughly study and evaluate (1) the technical feasi- bility, cost and lead time associated with the 2 gram level, and (2) the ------- -2- relationship between a 2.0 g/test standard and background emission levels, was not justified. Therefore, in order to allow implementation of the revised test procedure and the 6.0 g/test standard for 1978, the originally proposed regulatory action was divided into two separate rulemaking activities. The revised test procedure and 1978 standard have already been implemented. The implementation of a 2.0 g/test standard is currently needed since it is projected that many Air Quality Control Regions (AQCR's) will still exceed the ambient air quality standards for oxidants even as late as 1990, with the present control strategies for reducing emissions from mobile and stationary sources. B. Environmental Impact This rulemaking will result in reduction of nationwide hydrocarbon emissions from all mobile sources by as much as 10% in 1985 and 25% in the year 1990. In those Air Quality Control Regions that are expected to have the most difficulty meeting ambient air quality standards for oxidants in 1990, a 2.0 g/test standard will result in reduction of hydrocarbon emissions from all sources by an average of about 5% in that year. The final rulemaking is not expected to have any effect on vehicle fuel consumption. Likewise, this action should not have any effect on water or solid waste pollution. While the test procedure is designed to assess potential evaporative emission-exhaust emission interactions, ------- -3- these interactions need not occur with proper utilization of existing control technology. Therefore, this action is not expected to have any measurable effect upon exhaust emissions. C. Economic Impact 1. Character of the Industry The light-duty vehicle and light-duty truck industries are pri- marily comprised of General Motors Corporation, Ford Motor Company, Chrysler Corporation, American Motors Corporation, International Har- vester, Toyota, Nissan (Datsun), Volkswagen and Honda. U.S. sales of light-duty vehicles and light-duty trucks in 1976 were 12.3 million vehicles sold at a total wholesale value of approximately $40 billion. The industry employs 3.7 million employees in manufacturing, wholesaling, and retailing of motor vehicles. 2. Impact on Consumers It is estimated that the retail "sticker" price per vehicle will increase an average of $1 - $5 for control system components required to meet a 2.0 g/test standard. No additional costs over the life of the vehicle due to increased fuel consumption or maintenance are expected; ------- -4- and therefore, the additional emissions control will cost the consumer $1 - $5 over the lifetime of the vehicle. 3. Impact on Industry The major impact on the industry will be due to any decrease in sales resulting from the expected $1 - $5 increase in the price of vehicles. The projected sales decrease is 0.02 - 0.11%, assuming a price elasticity of 0.88*. No increase in the cost of certifying vehicles is expected, because the test procedure will be essentially unchanged. 4. Government Costs The cost to the government for the motor vehicle certification program is not expected to change, as the test procedure is essentially unchanged. 5. Cost Effectiveness The cost effectiveness of this rulemaking is estimated to be $20 - $100 per ton of hydrocarbon removed. This action is much more cost effective than reducing exhaust hydrocarbons to the statutory level of 0.41 g/mile which has a cost effectiveness of between $500 and $1400 per ton of hydrocarbon removed. * "The Effect of Tax and Regulatory Alternatives on Car Sales and Gasoline Consumption," Prepared for CEQ by Chase Econometric Associates, May 1974, p. 4. ------- -5- D. Alternative Actions The principle alternative actions considered were (I) Take no action (beyond the 6.0 g/test standard), (II) Set a 2.0 g/test standard for 1980 and subsequent model year vehicles and (III) Set a 2.0 g/test standard for 1981 and subsequent model year vehicles. Alternative action I (no action) was rejected because a further reduction in evaporative emissions is needed in order for certain Air Quality Control Regions to meet Ambient Air Quality Standards. Alternative II was rejected due to insufficient lead time now available to meet the 2.0 g/test level by 1980. The 2.0 g/test level for 1981 (Alternative III) has been shown to be technically feasible and cost effective. The technical feasibility of a standard lower than 2.0 g/test has not yet been demonstrated. The timing of this action will provide adequate lead time for development of control systems and certification. Other alternatives considered were the control of stationary sources of hydrocarbon emissions and the further control of exhaust hydrocarbons from mobile sources. Due to the nature of stationary sources and the infeasibility of further exhaust hydrocarbon control from mobile sources over what is currently planned, these alternatives were rejected and not treated in any detail. ------- -6- Chapter II Introduction A. Need for Control, Background and Description of This Action In many geographic regions a large portion of hydrocarbons (HC), carbon monoxide (CO), and nitrogen oxides (NOx) present in the air are attributable to motor vehicle emissions. The Congress, in recognition of the air pollution problem, passed the Clean Air Act which provides for a national air pollution program to monitor and control emissions from new motor vehicles and engines. Section 202(a) of the Clean Air Act, 42 U.S.C. 1957-l(a), provides that the Administrator shall prescribe standards for motor vehicle emissions if such emissions cause or contribute to air pollution which endangers the public health or welfare. The Administrator can require testing of new motor vehicles to deter- mine compliance with applicable standards under Section 206 and the general power to promulgate regulations is granted in Section 301. The need for further control of evaporative hydrocarbon emissions is based on the determination that the present and planned regulations for control of mobile and stationary sources of hydrocarbons are insufficient to bring many Air Quality Control ------- -7- Regions (AQCR's) into compliance with the ambient air quality standards for oxidants. This determination was based upon an analysis which used the best available inputs of vehicle mix, growth rates, emission factors and current ambient air quality data. In particular, Los Angeles, Sacramento, San Diego, San Francisco, San Joquin Valley, Corpus Cristi, Houston, Phoenix-Tucson, Denver, and the New Jersey portions of the New York AQCR will still exceed oxidant standards in 1990. The health effects of photochemical oxidants have been considered and described in previous publications.* Photochemical oxidants are created during photochemical reactions involving hydrocarbons and are thus controlled indirectly by controlling hydrocarbons. Ambient air quality standards have been set, based on those considerations, at levels which assure adequate public protection from the regulated pollutants. Therefore, since ambient air quality standards will be exceeded in many air quality control regions as discussed earlier, further reductions in HC emissions are necessary. Fuel evaporative hydrocarbon emissions have been studied and measured since 1958. Federal control of evaporative emissions was first proposed in the Federal Register on February 4, 1967 (32 FR, pp. 2448-50) to become effective for the 1969 model year. At that time a then novel and Air Quality Criteria Documents, Nos. AP-62, AP-63, AP-64, and AP-84 ------- -8- relatively untried measurement procedure was proposed, which collects the evaporative emissions in a large, sealed enclosure containing the test vehicle. However, when final rule making was published in the Federal Register on June 4, 1968 (33 FR, pp. 8304-24), the vehicle enclosure measurement procedure was abandoned in favor of a better known procedure, called the carbon trap method, which utilizes the adsorption of hydrocarbon on activated carbon. The activated carbon, encased in a metal canister, is weighed before and after the test to determine the mass of hydrocarbon adsorbed. The evaporative emission test measures the evaporative hydrocarbons emitted by the vehicle during daily temperature changes, vehicle opera- tion, and periods of hot engine soaking. This is accomplished during a three part test. The first part consists of artificially heating the fuel tank during a one hour period to simulate the normal rise in tank temperature resulting from normal daily ambient temperature increases. The second part of the test measures the losses during vehicle operation over a 7.5 mile trip. The third portion of the test consists of measu- ring the evaporative losses during the first hour after vehicle operation, when the engine is still hot. Using this test sequence, an emission standard was set at 6.0 g/test for the 1971 model year as measured by the carbon trap method. The evaporative emission standard was then reduced to 2.0 g/test for 1972 and subsequent model years. ------- -9- Over the intervening years since 1967 the vehicle enclosure method has been evaluated by several organizations, is considered to be "a superior technique, a versatile tool" (SAE paper 680125) compared to the "carbon trap" method, and has been developed into an SAE recommended practice (J171a).* This procedure was further modified to produce the Federal enclosure test method. On January 13, 1976 a notice of proposed rulemaking (NPRM) was published in the Federal Register (41 FR 2022), setting forth proposed amendments to Subparts A and B of Part 86 of the Code of Federal Regulations (CFR) to become effective with 1978 model year light-duty vehicles and light-duty trucks. The NPRM announced the agency's intention to revise the evaporative emission test procedures and establish standards of 6.0 g/test for 1978 and 2.0 g/test for 1979 and subsequent model years. The issue of a 2.0 gram per test standard is much more complex than the revised test procedures and the 1978 standard. Yet the 1978 standard represented so large (about 70%) of a reduction from current light- duty vehicle and truck evaporative emission levels, that the real risk of not being able to implement it for 1978, due to the additional time necessary to thoroughly study and evaluate (1) the technical feasibility, cost and lead time associated with the 2.0 gram level and (2) the relationship between a 2.0 g/test standard and background emission levels, was not justified. Therefore, in order to allow implementation of the revised test procedure and the 6.0 g/test standard for 1978, the originally * "Measurement of Fuel Evaporative Emissions from Gasoline Powered Passenger Cars and Light Trucks Using the Enclosure Technique - SAE J171a," published in the SAE Handbook, 1973. ------- -10- proposed regulatory action was divided into two separate rulemaking activities. The revised test procedure and 1978 standard were promulgated separately from the final rulemaking for a longer term evaporative emission standard, which is considered in this impact statement. A separate impact statement was written for the 6.0 g/test standard and revised test procedure. These regulations require more stringent control of evaporative emissions from light-duty vehicles and light-duty trucks by reducing the evaporative emission standard from 6.0 g/test to 2.0 g/test. The proposed standards included a 2.0 g/test standard for 1979 and subsequent MY vehicles. However, implementation of the more stringent 2.0 g/test standard has been delayed until 1981 due to insufficient lead-time for implementation in either 1979 or 1980. It should be noted that the standard for 1981 continues to require that light-duty trucks be controlled to the same level as light-duty vehicles, since the already developed evaporative emission control technology can be as effectively applied to light-duty trucks as to light-duty vehicles. B. Alternative Actions Considered Alternative actions to the final rulemaking fall into three cate- gories: (1) control hydrocarbons from other than mobile sources, (2) additional control of exhaust hydrocarbon emissions from mobile sources and (3) take alternative actions for the control of evaporative hydro- ------- -11- carbon emissions from light-duty vehicles and light-duty trucks. The division of emission sources into stationary and mobile categories by the Clean Air Act was not made as a function of the types of pollutants that they emit. Although excess pollutant emission of carbon monoxide (CO) is almost exclusively caused by mobile sources, the other currently regulated emissions from mobile sources (HC, NOx) are also emitted in substantial quantity by stationary sources. The division of sources into stationary and mobile categories appears to have been a function of a fundamental difference in the perception of how national strategies for their control could best be designed and executed: "Stationary sources tend to be individually unique, tend to exist for a long period of time if not indefinitely, tend in each case to require individualized control plans, and in the case of existing sources are primarily subject to State or local regulation. While new sources are in some cases subject to national regulation, such regulation is a long term control mechanism rather than a solution to the short term air quality problem; "Mobile sources, although vast in terms of individual numbers, tend to fall into relatively small generalized categories; tend to have far shorter life-spans (prior to being replaced with new equipment) than do stationary sources; and tend, because of the standardized mass production nature of creating them, to be more amenable to national (rather than local) control, at least insofar as their design and production is concerned. ------- -12- Because of the nature of the national control strategy for stationary sources, the future control of stationary sources as an alternative is not given further consideration in this document. The second category of alternative actions pertains to the additional control of exhaust hydrocarbon emissions from mobile sources. As was stated earlier, there are many regions which will not be able to meet ambient air quality standards by 1990 even if currently planned control of motorcycle, light-duty truck, and heavy-duty vehicle exhaust emis- sions and statutory standards for light-duty vehicle exhaust emissions are implemented. Control of exhaust emissions from these sources beyond levels now planned is not considered to be technologically feasible at this time. However, additional control of evaporative hydrocarbon emissions from light duty vehicles and light duty trucks is feasible. Thus, the alternative actions that will be considered will only deal with those alternatives directly pertaining to further evaporative control, because of the nature of the national control strategy for stationary sources and ,the infeasibility at this time of proposing more stringent control of other mobile sources of hydrocarbon emissions. A standard more stringent than 6.0 g/test should be at a level that is technically feasible and which gains a desired level of control. The timing of a more stringent standard should provide adequate lead time for design and development prior to the beginning of certification. ------- -13- Th e Proposed Evaporative Emission Regulation for 1978 and Subsequent Model Year Vehicles (41 FR, pp. 2022, January 13, 1976), proposed a 2.0 g/test standard for 1979 and subsequent model year vehicles. A 2.0 g/test level has since been shown to be technically feasible*. A standard less stringent than 2.0 g/test would of course be technically feasible but would not provide as much control as is possible. A more stringent standard (such as 1.0 g/test) has not yet been shown to be technically feasible and therefore cannot be considered for promulgation at this time. Thus, a 2.0 g/test level, as originally proposed, appears to be an optimum lower standard. The original proposal was for a 2.0 g/test standard in 1979. Lead time considerations now make this implementation date impossible. An analysis of the lead time required to meet a 2.0 g/test standard** indicates that there is also insufficient lead time to develop, design, certify and manufacture control systems for 1980; but, there is sufficient time for the 1981 model year. Therefore the recommended timing for a 2.0 g/test standard is for 1981 and subsequent model year vehicles. The following alternative actions for further evaporative emissions control will be considered: Alternative Action I - No action, i.e., no change in the present 6.0 g/test standard. * "Technical Feasibility of a 2.0 g/test SHED Evaporative Emission Standard or Light-Duty Vehicles and Trucks," Issue Paper by Michael W. Leiferman, EPA, Ann Arbor, Michigan, June 1976. ** "Lead Time Requirement for an Evaporative Emission Standard of 2.0 g/test for Light-Duty Vehicles and Trucks," Issue Paper by Michael W. Leiferman, EPA, Ann Arbor, Michigan, June 1976 (Revision November 1977). ------- -14- Alternative Action II - Set a 2.0 g/test standard for 1980 and subsequent model years as measured by the Federal enclosure method. Alternative Action III - Set a 2.0 g/test standard for 1981 and sub- sequent model years as measured by the Fed- eral enclosure method. C. Structure of Report This report is an analysis of the economic and environmental impact of setting an evaporative emission standard of 2.0 g/test for 1981 and subsequent model years using the enclosure test method. As earlier stated, there is clearly not sufficient lead time for 1979 implementation; and therefore, that alternative will not be treated in the cost and environmental analysis. Chapter III of this report will set the ground work for these analyses by describing the Light-Duty Vehicle (LDV) and Light-Duty Truck (LDT) industries with respect to production and employment, etc. In addition, current and projected vehicle populations and a description of vehicle usage will be presented. Chapter IV will discuss the primary and secondary impacts of the alternative actions on environmental quality. ------- -15- 'V- / - In Chapter V, the analysis of the costs to the consumer, industry and government will be discussed. The predicted costs will be made to reflect an average cost to all consumers and industry, and as such will ignore the variability in costs to individual consumers resulting from the variety of emission control systems capable of meeting the standard, and the costs of the equipment in that system. The costs to consumers may also vary depending on a manufacturer's perception of the market force and the discretionary power he has in setting prices of vehicles. The cost effectiveness of the final rulemaking will be discussed in Chapter VI. The cost effectiveness of this action and the cost effective- ness of alternative actions for the control of hydrocarbon emissions will be compared. Cost effectiveness will be expressed in terms of dollars required to control a ton of hydrocarbons. Chapter VII will discuss the Impact of the alternative actions on the irreversible or irretrievable commitment of our natural resources. Along with this discussion, will be a discussion of the trade-offs between short-term gains and long-term losses, or vice versa, and a rationale for the timing of this proposed action. Comments on the draft impact statement will be summarized and discussed in Chapter VIII. ------- -16- Chapter III Description of LDV, LPT Industry A, Definition of Product A light-duty vehicle (LDV) is defined as a passenger car or passenger car derivative capable of seating 12 passengers or less. 1977 model year light-duty vehicles (and light-duty trucks) were required to meet a 2.0 g/test evaporative emission standard as measured by the carbon trap method. Beginning with the 1978 model year, light-duty vehicles (and light-duty trucks) are required to meet a 6.0 g/test evaporative emission standard as measured by the enclosure test method. The definition of light-duty truck (LDT) for the 1979 and later model years is any motor vehicle rated at 8,500 pounds Gross Vehicle Weight Rating (GVWR) which has a vehicle curb weight of 6,000 pounds or less and which has a basic vehicle frontal area of 46 square feet, which is: 1) Designed primarily for purposes of transportation of property or is a derivative of such a vehicle, or 2) Designed primarily for trans- portation of persons and has a capacity of more than 12 persons, or 3) Available with special features enabling off-street or off-highway operation and use. Prior to the 1979 model year, trucks between 6,000 ------- -17- and 8,500 pounds GVW were classified as heavy-duty vehicles and as such they were not required to comply with evaporative emission regulations. The LDV and LDT industries produce a wide variety of vehicles consisting of many significant variations in vehicle design and size and many engine configurations, engine sizes, fuel tank sizes, etc. EPA surveillance data on controlled 1972 and 1973 light-duty vehicles did not show any statistically significant correlation between evaporative emissions and the fuel tank or engine size. Thus, the variations in product configuration should pose no special problems for the industry in complying with further evaporative regulations. B. Structure of the Industry (Production and Marketing) U.S. manufacture of light-duty vehicles is almost entirely done by four motor vehicle manufacturers: General Motors, Ford Motor Company, Chrysler Corp., and American Motors Corp. However, a sizable percentage of new LDV sales is from imported vehicles. In 1976, 778,188 cars were built in Canada and exported for sale in the U.S. Imports accounted for roughly 18% of new car sales in the U.S. The major foreign importers are Toyota, Nissan (Datsun), Volkswagen and Honda. ------- -18- Th e manufacture of light-duty trucks sold in the U.S. is primarily accomplished by the major domestic passenger car producers. General Motors Corporation (Chevrolet and GMC divisions), Ford Motor Company and Chrysler Corporation (Dodge Truck division) all have separate truck divisions which produce light-duty as well as heavy-duty trucks. American Motors Corporation operates the Jeep division which manufactures light- duty trucks. The other major domestic manufacturer of LDTs is the International Harvester Corporation (IHC). International does not produce light- duty passenger vehicles but does produce a line of light and heavy- duty trucks. Some LDTs sold in the U.S. are imported. The majority of U.S. imports of trucks come from the Canadian plants operated by U.S. domestic producers. Some imports, primarily light pick-up trucks under 4,000 pounds GVW, come from Japanese producers. The major importers are Nissan (Datsun), Toyota, Isuzu and Toyo Kogyo. Both Toyota and the British Leyland Company import utility vehicles under 6,000 lbs. GVW. Imports account for about 5% of all 1975 factory sales of trucks with a GVW less than 10,000 pounds. Table III-l shows unit factory sales for light-duty vehicles and light-duty trucks from U.S. plants. Most data available on light- duty trucks are presented in two categories, based on GVW. There is a 0-6,000 ------- Table III-l Light-Duty Vehicle and Light-Duty Truck Factory Sales from U.S. Plants"'" 1971 8,584,592 1,598,785 10,183,377 i i—1 VO I Source: Motor Vehicle Manufacturers Association of the United States, Inc. 1) Includes those vehicle produce in U.S. that are exported 2) Data from Automotive News, 1977 Market Data Book 3) Data from Automotive News Almanac, 1975 Type of Vehicle 19762 19752 19743 1973 1972 Light-Duty Vehicle 8,497,603 6,712,852 7,331,946 9,657,647 8,823,938 Light-Duty Truck redefined class 2,505,448 1,848,223 2,154,892 2,372,269 1,899,204 (0-8,500 lb. GVW) LDV plus redefined 11,003,051 8,561,075 9,486,838 12,029,916 10,723,142 LDT classes ------- -20- pound and a 6,001-10,000 pound category. Since the proposed definition of light-duty trucks includes only trucks up to 8,500 pounds GVW, some adjustment to the 6,001-10,000 category was necessary for this analysis. Industry production data available to EPA indicate that only five percent of all trucks with GVWs less than 10,000 pounds have GVWs of more than 8,500 pounds. This five percent figure is used in Table III- 1 and throughout this analysis to adjust production data to fit the proposed LDT definition. Table III-2 shows new car and truck registrations for 1973 through 1976. These figures represent the numbers of both domestic and imported vehicles bought by U.S. consumers in those years. Table III-3 is a breakdown of market sales by manufacturer for 1976 light-duty vehicles. Also included is the percent of the passenger car market for each manufacturer. Table III-4 gives similar information for the light-duty truck industry. It should be noted that Table III-4 gives market shares for 0-10,000 lbs. GVW truck sales. Data indicating the portion of sales for 0-8,500 lbs. GVW trucks for each manufacturer were not available and the assumption that 5% of sales would be over 8500 lbs. GVW is not valid for every manufacturer. U.S. light-duty vehicle and light-duty truck manufacturers operate with a fair degree of vertical integration. As is typical of many capital intensive industries, the manufacturer seeks to assure himself of some control over the quality and availability of the final product. ------- -21- Table III-2 New Vehicle Registrations" Source LDV LDT2 Total 1976 9,751,485 2,588,213 12,339,698 New Car Registrations 3 . 4 1975 8,261,840 1,995,016 10,256,856 1974 8,701,094 2,143,198 10,844,292 1) Includes imports 2) Redefined Light-Duty Truck Class (0-8,500 lb. GVW) 3) Source: Automotive News, 1977 Market Data Book 4) Source: Automotive News Almanac, 1975 1973 11,350,995 2,431,454 13,782,449 ------- -22- Table III-3 Market Sales of Light-Duty Vehicles by Manufacturer for 1976 Manufacturer Chevrolet Pontiac Oldsmobile Buick Cadillac GM Total No. of Units Produced 2,035,858 706,460 867,485 700,778 293,716 4,604,297' % of Passenger Car Market 20.88 7.24 8.90 7.19 3.01 47.22 Ford Lincoln Mercury Ford Total 1,665,619 115,801 408,121 2,189,541 17.08 1.19 4.18 22.45 Plymouth Dodge Chrysler Chrysler Total 526,957 460,647 271,061 1,259,076 5.40 4.72 2.78 12.90 American Motors Corp. 247,032 2.53 Miscellaneous 1,451,539 14.89 Total 9,751,485 Source: Automotive News, 1977 Market Data Book 100% ------- -23- Table III-4 Market Sales of Light-Duty Trucks' by Manufacturer for 1976 Manufacturer Chevrolet GMC Ford Chrysler AMC/Jeep IHC Other Manufacturers' No. of U.S. Truck Sales 1,011,377 223,805 870,231 338,078 107,487 34,100 139,350 % of Light Truck Market 37.12 8.21 31.94 12.41 3.95 1.25 5.12 Total 2,724,435 100% Source: Automotive news, 1977 Market Data Book 1 , • Light Truck defined as 0-10,000 lb GVW Includes imports ------- -24- Th us , the major manufacturing companies have acquired subsidiaries or started divisions to produce many of the parts used in the manufacture of their cars and trucks. None, however, build their vehicles without buying some equipment from independent vendors. The vertical integration typical of passenger car and truck manu- facturers extends beyond the production of the vehicle into its sale. The manufacturers establish franchised dealerships to handle retail trade and servicing of their products. Most also produce and sell the parts and accessories required to service their vehicles. Many of the truck dealerships are coupled with the passenger car dealerships. As of January 1, 1977, there was a total of 24,268 passenger car dealerships and 23,021 truck dealerships. The total truck dealerships include dealerships for heavy-duty as well as light-duty trucks, and accounts for those dealerships operating jointly with passenger car sales offices. Table III-5 provides a breakdown of all light-duty vehicle dealerships by manufacturer and Table III-6 provides this information for light-duty truck dealerships. C. Sales and Revenues Passenger car sales from domestic manufacturers for 1976 were 8.50 million vehicles at a total wholesale value of about $30 billion. For 1975, ------- -25- Table III-5 Passenger Car Dealerships by Manufacturer Total Dealers as Unit Sales Franchises as of Jan. 1, Per Outlet Manufacturer of Jan. 1, 1977 1977 1976 1975 American Motors 1,690 1,690 140 177 Chrysler Corp. 9,235 4,811 Chrysler 3,272 86 70 Dodge 2,850 166 117 Plymouth 3,113 174 127 Ford Motor Co. 10,125 6,637 Ford 5,567 308 276 Lincoln 1,618 76 62 Mercury 2,940 143 119 General Motors Corp. 17,205 11,670 Buick 3,045 244 171 Cadillac 1,610 190 166 Chevrolet 5,990 350 302 Oldsmobile 3,315 272 192 Pontiac 3,245 233 155 Totals 38 ,'2 55 24,808 Minus Intercorporate Deals 540 Net Dealers 24,268 Source: Automotive News, 1977 Market Data Book ------- -26- Table III-6 Truck Retail Outlets by Manufacturer Manufacturer Ford Chevrolet GMC Dodge IHC AMC/Jeep Others Total Adjustments for Multiple Franchises Outlets as of January 1, 1977 5,626 5,590 2,750 3,170 1,948 1,628 3,534 Unit Sales Per Outlet 24,246 1,225 1976 169 188 93 126 52 67 1975 132 136 62 90 52 54 Total 23,021 Source: Automotive News, 1977 Market Data Book ------- -27- 6.71 million vehicles were sold at a wholesale value of $23.4 billion. The light-duty truck industry (0-8,500 lbs. GVW) had 2.51 million sales at a value of about $10 billion in 1976 and 1.85 million sales at a value of about $7 billion in 1975. D. Employment It is estimated that 3,661,549 workers are employed in manufacturing, wholesaling and retailing of motor vehicles (passenger cars, trucks, and busses) with a total $25.5 billion dollars in annual wages paid to those employees. Accurate employment figures for the separate manufacturing, wholesaling and retailing of light-duty trucks or light-duty vehicles are difficult to find. Most employment data are aggregated for all producers of all classes of cars and trucks since some production facilities manufacture both light and heavy trucks. Statistics show that approxi- mately 31,400 workers were employed in 1972 by U.S. manufacturers of trucks. The annual payroll of these workers totalled $250.25 million dollars. Much of this employment is centered in California, Michigan, Ohio, New York, Indiana, Illinois and Missouri. ------- -28- Chapter IV Environmental Impact A. Primary Impact This section will describe the expected environmental impact of the establishment of a more stringent evaporative emission standard using the Federal enclosure test method adopted for 1978. The alternative actions considered in this Chapter, Chapter V and Chapter VI, are as follows: Alternative Action I: No action (beyond the 6.0 g/test standard). Alternative Action II: A 2.0 g/test standard for 1980 and subsequent model years as measured by the Federal enclosure test procedure. Alternative Action III: A 2.0 g/test standard for 1981 and subsequent model years as measured by the Federal enclosure test procedure. In addition, the primary impacts of other reference control strategies will be presented in order to show the relative effectiveness of the ------- -29- final rulemaking in the reduction of hydrocarbon emissions. These strategies include establishment of the 6.0 g/test evaporative emission standard as measured by the enclosure test method, reduction of light- duty vehicle exhaust hydrocarbon standards to the statutory level (0.41 g/mile) and an inspection maintenance program. 1. Current and Projected Emission Factors In order to evaluate the effect of alternative, actions on ambient air quality, the rate of emission of hydrocarbons from sources other than just evaporation must be known as a function of vehicle age. Tables IV-1 and IV-2 give the evaporative hydrocarbon emission rates for light-duty vehicles and light-duty trucks, respectively. Past emission rates for light-duty vehicles were obtained from surveillance testing of 1957 through 1972 model year vehicles. 1971 through 1977 vehicles are controlled for evaporative emissions under the "carbon trap" certification test method. 1978 and subsequent model year vehicles will be controlled for evaporative emissions under the Federal enclosure test method. The 6.0 and 2.0 g/test standards for 1978 and 1981, respectively, assume that the emissions would be comprised of 1.0 g/test from the diurnal portion of the evaporative emission test, with the rest being contributed during the hot soak portion of the test. In order to estimate the environmental impact of a 2.0 g/test standard for the 1981 model year, hydrocarbon emission factors must be coupled with vehicle miles travelled data during a year's time in order ------- -30- Table IV-1 Evaporative HC Emission Factors for Light-Duty Vehicles by Model Year Evaporative HC Emission Factors By Source Composite Emissions Diurnal Hot Soak Model Year(s) (g/day) (g/trip) g/day g/mi pre 1970 26.0 14.7 74.5 2.53 1970 (Calif.) 16.3 10.9 52.3 1.78 1970 (non-Calif.) 26.0 14.7 74.5 2.53 1971 16.3 10.9 52.3 1.78 1972-77 12.1 12.0 51.7 1.76 6 g/test std. 1.0 5.0 17.5 0.60 2 g/test std. 1.0 1.0 4.3 0.15 Source: Supplement No. 5 for Compilation of Air Pollutant Emission Factors, AP-42. Gram per day values are hot soak emissions times the average number of trips per day plus diurnal emissions. Nationwide data from the Department of Transportation and Automobile Manufacturers Association indicate that the average vehicle is used 3.3 trips per day. Gram/ mile values were determine by dividing average g/day by the average nationwide travel per vehicle of 29.4 mi/day. ------- -31- Table IV-2 Evaporative HC Emission Factors for Light-Duty Trucks by Model Year HC Emission Factor"'" Model Year(s) (fi/mi) pre 1970 3.6 1970-1977 3.1 6 g/test Standard .60 2 g/test Standard .15 Source: Supplement No. 5 for Compilation of Air Pollutant Emission Factors, AP-42. Gram per mile values are based on 3.3 hot soaks per day and 29.4 miles travelled per day. ------- -32- to estimate the tons of hydrocarbons emitted per year. For the computation of hydrocarbon emissions from various mobile sources, the following assumptions were made: a. Light-duty vehicles - The standard of 1.5 g/mi for exhaust hydrocarbons is in effect until 1979. In 1980 light-duty vehicles will meet the statutory exhaust hydrocarbon emission standard of 0.41 g/mi. Evaporative emission rates will be those shown in Table IV-1. b. Light-duty trucks - In the analysis, light-duty trucks are defined as all trucks with gross vehicle weight below 8500 lbs. Prior to 1979, trucks below 6000 lbs. are regulated at a level of 2.0 g/mi of exhaust hydrocarbons, and trucks between 6000 and 8500 lbs. are regulated as heavy-duty vehicles at an estimated exhaust HC level of 5.6 g/mile. In 1979 and subsequent years, all light-duty trucks are assumed to be regulated to an exhaust HC standard of 1.7 g/mi. Evaporative HC emissions from LDT's are as shown in Table IV-2. c. Heavy-duty vehicles - In this analysis, heavy-duty vehicles are defined as all trucks with a gross vehicle weight above 8500 lbs. It is assumed that heavy-duty gasoline trucks are regulated at a level of 19.7 g/mi between 1970 and 1973, 12.4 g/mi between 1974 and 1978, and 3.2 g/mi in 1979 and subsequent years. It is assumed that heavy-duty diesel trucks are regulated at a level of 4.5 g/mi starting in 1974. ------- -33- d. Motorcycles - For this analysis motorcycles are not considered, since with the implementation of regulations to control exhaust emissions from motorcycles beginning in 1978, the inclusion of motorcycles would not have an appreciable impact on the projec- tions made. 2. Vehicle Population and Vehicle Usage In order to estimate the amount of a pollutant released to the atmosphere, it is necessary to know how many vehicles are in use and what proportion of different age vehicles are in that population. It is also necessary to know how much mileage is accumulated by the different segments of the vehicle population. Table IV-3 gives vehicle registrations for 1965 through 1974. Table IV-4 and IV-5 give the fraction of annual travel by model year for light- duty vehicles and light-duty trucks, respectively. By coupling these fractions with the overall annual mileage (urban plus rural) and the emission rates from different age vehicles, one can predict the total amount of hydrocarbons emitted by these vehicles to the atmosphere in a given year. Similar data can be used to determine the contribution of other mobile sources. Mileage accumulation rates nationwide and for the five Air Quality Control Regions evaluated in this chapter are given in Tables IV-6 and IV-7 for light-duty vehicles and light-duty trucks, respectively. ------- -34- Table IV-3 Passenger Car and Truck Registration For the Last 10 Years* Year Passenger Cars Trucks-*- 1974 105,290,000 25,030,000 1973 101,762,477 23,232,872 1972 96,980,314 21,238,922 1971 92,754,061 19,837,063 1970 89,230,567 18,767,294 1969 86,852,275 17,882,129 1968 83,591,694 16,941,293 1967 80,414,180 16,178,849 1966 78,122,965 15,516,895 1965 75,251,386 14,795,051 ^Includes privately and publicly owned vehicles. Source: Automotive Facts and Figures, MVMA, 1975 1) All classes of trucks included ------- 1 2 3 4 5 6 7 8 9 10 11 12 13 -35- Table IV-4 Nationwide Fraction of Annual Travel by Model Year for Light-Duty Vehicles Fraction ot Total Average Annual Fraction of Vehicles in use miles driven Annual Miles Nationwide (a) (b) a x b Traveled 0.083 15,900 1,320 0.116 0.103 15,000 1,545 0.135 0.102 14,000 1,428 0.125 0.106 13,100 1,389 0.122 0.099 12,200 1,208 0.106 0.087 11,300 983 0.086 0.092 10,300 948 0.083 0.088 9,400 827 0.072 0.068 8,500 578 0.051 0.055 7,600 418 0.037 0.039 6,700 261 0.023 0.021 6,700 141 0.012 0.057 6,700 382 0.033 Supplement No. 5 for compilation of Air Pollutant Emission Factors, AP42. ------- Age Yea 1 2 3 4 5 6 7 8 9 10 11 12 -13 -36- Table IV-5 Nationwide Fraction of Light-Duty Truck Annual Travel by Model Year raction of Total Average Fraction of vehicles in use Annual Annual Nationwide (a) Miles Driven (b) a x b Travel 0.061 15,900 970 0.094 0.095 15,000 1,425 0.138 0.094 14,000 1,316 0.127 0.103 13,100 1,349 0.131 0.083 12,200 1,013 0.098 0.076 11,300 859 0.083 0.076 10,300 783 0.076 0.063 9,400 592 0.057 0.054 8,500 459 0.044 0.043 7,600 327 0.032 0.036 6,700 241 0.023 0.024 6,700 161 0.01b 0.185 4,500 832 0.081 Supplement No. 5 for Compilation of Air Pollutant Emission Factors, AP42. ------- Table IV-6 Total Vehicle Miles Travelled by Light-Duty Vehicles Los Angeles New Jersey part Houston- Phoenix- Denver Nationwide3 AQCR •b of New York AQCRC Galveston AQCR^ Tuscon AQCRe AQCR (billions of (billions of (billions of (billions of (billions (billions Year miles) miles) miles) miles) of miles) of miles) 71 44.6 27.0 11.3 8.22 5.60 72 986 45.9 27.6 11.9 8.63 6.09 73 1016 47.2 28.1 12.5 9.06 6.62 74 1046 48.6 28.7 13.2 9.51 6.82 75 1077 50.0 29.3 13.8 9.98 7.01 76 1100 51.5 29.9 14.5 10.5 7.23 77 1144 52.9 30.5 15.2 11.0 7.44 78 1177 54.4 31.1 16.0 11.6 7.67 79 1213 56.0 31.7 16.8 12.1 7.90 80 1249 57.6 32.3 17.6 12.7 8.14 85 1449 65.1 35.7 19.5 14.8 8.99 90 1679 73.8 39.4 21.5 17.1 9.91 a. Based on FHWA Highway Statistics and an assumption of a 3% growth rate after 1974. b. Based on data from "Transportation Control Strategy Development for the Metropolitan L.A. Region", APTD-1372, Dec. 1972. c. Based on vehicle registration data from New Jersey, census data relating the fraction of the population in AQCR, and on nationwide vehicle miles travelled average from AP42 Compilation of Air Pollution Emis- sion Factors. Assumed 2% per year growth rate. d. Based on Texas Highway Department Data. Growth rate assumed to be 5% until 1980 and 2% thereafter. e. Based on Arizona Highway Department Data and growth rates of 5% until 1980 and 3% thereafter. f. Based on Colorado Div. of Highways Data and assumed growth rates of 3% until 1980, 2% thereafter. ------- Table IV-7 Total Vehicle Miles Travelled by Light-Duty Trucks Los Angeles New Jersey part Houston- Phoenix- Denver Nationwide3 AQCRb of New York AQCRc Galveston AQCR^ Tuscon AQCR^ AQCR f (billions of (billions of (billions of (billions of (billions (billions Year miles) miles) miles) miles) of miles) of miles) 71 4.39 3.22 1.35 1.19 .667 72 156 4.51 3.28 1.42 1.25 .725 73 160 4.64 3.35 1.49 1.31 .788 74 165 4.78 3.42 1.57 1.38 .812 75 170 4.91 3.49 1.64 1,45 .835 76 175 5.06 3.56 1.73 1.52 .861 77 180 5.20 3.63 1.81 1.60 .886 78 186 5.35 3.70 1.90 1.68 .913 79 192 5.50 3.77 2.00 1.76 .941 80 197 5.66 3.85 2.10 1.85 .969 85 229 6.40 4.25 2.32 2.14 1.07 90 266 7.25 4.69 2.56 2.49 1.18 a. Based on FHWA Highway Statistics and an assumption of a 3% erowth rate after 1974. b. Based on data from "Transportation Control Strategy Development for the Metropolitan L.A. Region", APTD-1372, Dec. 1972. c. Based on vehicle registration data from New Jersey, census data relating the fraction of the population in the AQCR, and on nationwide vehicle miles travelled average from AP42 Compilation of Air Pollution Emission Factors. Assumed 2% per year growth rate. d. Based on Texas Highway Department Data. Growth rate assumed to be 5% until 1980 and 2% thereafter. e. Based on Arizona Highway Department Data and growth rates of 5% until 1980, 3% thereafter. f. Based on Colorado Div. of Highways data and assumed growtb rates of 3% until 1980, 2% thereafter. ------- -39- 3. Nationwide Emissions Table IV-8 and Figure IV-1 show the results of an analysis such as is described in the preceding section. The figure shows that exhaust hydrocarbons will be reduced by 1990, but will have leveled off. If a further reduction in the evaporative emission standard (to 2.0 g/test) is not made, evaporative emissions will contribute roughly the same amount of HC emissions as exhaust emissions from light-duty vehicles and trucks. Figure IV-2 shows that evaporative hydrocarbons will contribute roughly 36% of all hydrocarbons in 1990 from mobile sources if no further action is taken. Figure IV-2 also shows that a 2.0 g/test standard will significantly lower the percent contribution of evaporative emissions to total mobile source hydrocarbon emissions. Figure IV-3 contrasts the effect of the alternative actions on nationwide hydrocarbon emissions from mobile sources from 1972 to 1990. It shows that, while emissions are expected to decrease significantly, larger reductions will be realized if evaporative emissions are further controlled by implementation of a 2.0 g/test standard. Table IV-9 shows what reductions in hydrocarbons are expected by the year 1990. A 2.0 g/test standard implemented for 1981 and subsequent model years would lead to the reduction shown by the year 1990. The table also shows the reductions that will be realized by implementation of the 1978 6.0 g/test evaporative emission regulations, implementation of the exhaust hydrocarbon emission standard of 0.41 g/mile and the implementation of an inspection maintenance program. ------- Table IV-8 Hydrocarbon Emissions from Mobile Sources (10^ ton/year) Exhaust Emissions 1 Crankcase Emissions 1 Exhaust & Crank- case and EVAP 0 Emissions EVAP Emissions (No Action)^ EVAP Emissions (Alt. Action II)"* (Alt EVAP Emissions . Action Year LDV LPT LDV LPT HPG HPD LDV LPT LDV LPT LDV LPT 1972 5.3 1.25 .59 .22 1.64 .15 2.54 .59 2.54 .59 2.54 .59 1975 4. 7 1.04 .15 .08 1.53 .16 2.45 .61 2.45 .61 2.45 .61 1978 3.7 .80 .05 .05 1.31 .17 2.27 .60 2.27 .60 2.27 .60 1980 3.0 .69 0 0 1.19 .18 1.89 .49 1.82 .48 1.89 .49 1985 1.6 .48 0 0 .92 .20 1.24 .27 . 74 .20 .80 .22 1990 .78 .41 0 0 .83 .23 1.10 .17 .31 .06 .33 .06 1) Based on Emission Factors found in "Supplement No. .5 for Compilation of Air Pollutant Emission Factors," AP-42. 2) Based on Emission Factors Found in "Second Addendum to Memorandum Entitled 'Revised Estimates of Total Nationwide Emissions for Various Regulatory Alternatives." Meno from S. Guy Forbes, EPA, to Ernest S. Rosenberg, EPA, March 30, 1976, (Available in EPA public docket). 3) Based on Emission Factors Found in Tables IV-1 and IV-2. ------- -41- Figure 1V-1 Projected Nationwide Vehicle HC Emissions LDV & LDT Exhaust Emissions LDV & LDT Evap Emissions (No Action) \ \ LDV & LDT Evap. Emissions (2 g/test std. in 1981) LDV & LDT Evap Emissions (2 g/test Std. in 1980) HDV Emissions — LDV & LDT Crankcase 76 78 80 84 86 88 72 74 82 90 Year ------- -42- Figure 1V-2 Projected Percentage of Mobile Source HC Emissions Attributable to "Evaporative Emissions From Light Duty Vehicles and Light Duty Trucks. c 40 o w •H tfl W C/l U) •H c 6 o w •H CO u W EG •rl e 30 w u M a 3 n) o > CO W a) H i Q 'rH ~J + £ 20 > <4-1 a o 6-5 10 _ No action 2 g/test std. in 1981 2 g/test Std. in 1980 1 1 1 1 1 1 1 1 1 1 72 74 76 78 80 82 84 86 88 90 Year ------- -43- Figure IV-3 Projected Nationwide Hydrocarbon Emissions from Mobile Sources 12 - 10 - 8 - 4 - No action 2 g/test Std. in 1981 2 g/test Std. in 1980 2 - _l 1 1 1 1 1 1 1 1 1 72 74 76 78 80 82 84 86 88 90 Year ------- -44- Table IV-9 Projected Nationwide HC reductions by 1990 Nationwide HC reduction in 1990 Action in 10 ton/year Alternative Action I Alternative Action III 0.9 1978 Evaporative Regulations 2.9 Reduce LDV Exhaust Standard from 1.5 to 0.41 g/mile 1.9 Inspection Maintenance^" . 88-3.1 Source: Internal EPA memo from M. Williams to J. Lane, Aug. 18, 1975, assuming a 20% failure rate. ------- -45- 4. Impact on Some Regions Analyses have been performed which indicate that many Air Quality Control Regions (AQGRs) will still be unable to meet established National Ambient Air Quality Standards for oxidants in 1985. These regions are listed in Table IV-10. Four of these regions have been analyzed to show what the effects would be in 1985 and in 1990 for the two extreme alternative actions considered; i.e., no control beyond 6.0 g/test (alternative I), and a 2.0 g/test standard beginning with the 1980 model year (alternative II). As previously shown in the environmental impact analysis on a nationwide basis, there would not be a large difference in total HC atmospheric loading between the 1980 implementation date and the 1981 implementation date (alternative III). The four AQCRs analyzed are Phoenix-Tuscon, Los Angeles, Denver, and Houston-Galveston. Similar trends as the ones shown in Figures IV- 1, IV-2 and IV-3 for national emissions existed for these AQCRs. More importantly, however, is what percent reductions in overall hydrocarbons will be achieved in these various regions due to implementation of a 2.0 g/test standard, and whether or not this will allow these regions to meet the oxidant ambient air quality standard. Tables IV-11 and IV-12 show what the mobile and total hydrocarbon levels will be in 1985 and 1990, respectively, for the two alternative actions analyzed. Also, the hydrocarbon levels required to meet the ------- -46- Table IV-10 Regions of the U.S. Predicted to Have Air Quality Problems in 1985 due to Photochemical Oxidants Los Angeles S. E. Desert Houston-Galveston National Capitol San Francisco San Joaquin Sacramento Valley San Diego S. E. Texas Phoenix-Tuscon Denver Corpus-Christi NY-NJ-Conn. Clark-Mohave Dayton S. W. Pennsylvania Birmingham Philadelphia Boston Cincinnati Indianapolis Genesse Finger Lakes San Antonio Source: "Air Quality Impact of Alternative Emission Standards for Light-Duty Vehicles," OAWM, EPA, March 12, 1975 revision. ------- Table IV-11 Hydrocarbon Emission Reductions in 1985 3 HC Emissions in 10 tons/year Mobile HC Sources No Action 2g standard in 1980 Reduction Total HC Sources No Action 2g standard in 1980 Reduction Levels Needed to Meet Ambient Air Quality Standard Phoenix- Tuscon Los Angeles Denver Houston Galveston 52.3 175.1 34. 7 61.0 46.3 150. 7 31.3 53.5 5.0 24.4 3.4 7.5 175-1 619.1 57.7 369.2 169.1 594.7 54.3 361.7 5.0 24.4 3.4 7.5 87.8 55.8 25.8 61.5 ------- Table IV-12 Hydrocarbon Emission Reductions in 1990 3 HC Emissions in 10 ton/year Mobile HC Sources Total HC Sources Levels Needed 2g standard 2g standard to Meet Ambient No Action in 1980 Reduction No Action in 1980 Reduction Air Quality Standard Phoenix- Tuscon 37.4 28.5 8.9 191.8 182.9 8.9 87.8 Los Angeles 141.8 103.8 38.0 694.2 656.2 38.0 55.8 Denver 23.5 18.3 5.2 50.8 45.6 5.2 25.8 Houston- Galveston 45.6 34.2 11.4 421.8 410.4 11.4 61.5 ------- -49- Ambient Air Quality Standard of .08 ppm oxidant is given for each of the four AQCRs. These tables indicate that while a sizeable reduction in hydrocarbons would be achieved, these regions will still be unable to meet the Ambient Air Quality Standards. (Note: These regional analyses assume that the LDV exhaust HC standard of 0.41 g was implemented with the 1978 model year rather than 1980, so the predicted levels of HC emissions in Tables IV-11 through IV-14 are somewhat lower than currently expected.) Table IV-13 and IV-14 show the expected reduction in hydrocarbon emissions as a percent of mobile HC emissions, total HC emissions, and as a percentage of the emission levels needed to meet the Ambient Air Quality Standards by 1985 and 1990 respectively. The tables emphasize the importance of implementating the 2.0 g/test standard. B. Secondary Environmental Impacts This section deals with the secondary environmental impacts of the alternative actions and for contrast includes the secondary impacts of reducing LDV exhaust standards to statutory levels. The secondary impacts that are discussed are 1) the effect on energy consumption, 2) the effect on the percent of reactive hydrocarbons emitted, 3) the possible interaction effect of evaporative emissions and exhaust emissions, and 4) the potential impact on water and solid waste pollution. ------- Table IV-13 HC Emission Reductions as % of Mobile Sources, Total Sources and Ambient Air Quality Standard in 1985 Phoenix- Tuscon Los Angeles Denver Houston Galveston HC Reductions Due to 2 g/test std. in 1980 (10"* tons/yr) 5.0 24.4 3.4 7.5 HC Reductions HC Reductions as % of Mobile HC as % of Total HC Sources 9.6 13.9 9.8 12.3 Sources 2.9 3.9 5.9 2.0 HC Reductions as % of Ambient Air Quality Std. 5.7 43.7 13.3 12.2 Average 11.4 3.7 18.7 ------- Table IV-14 HC Emission Reductions as % of Mobile Sources, Total Sources and Ambient Air Quality Standard in 1990 Phoenix- Tuscon Los Angeles Denver Houston- Galveston HC Reductions Due to 2 g/test std. in 1980 (10 tons/yr) 8.9 38.0 5.2 11.4 HC Reductions as % of Mobile Sources 23.8 26.8 22.1 HC Reductions as % of Total HC Sources 4.6 5.5 10.2 24.9 2.7 HC Reductions as % of Ambient Air Quality Std. 10.2 68.2 20.1 18.4 Average 24.4 5.8 29.2 ------- -52- 1. Energy Consumption No change in energy consumption is anticipated through the promulgation of these regulations. Specifically, no increase in fuel consumption is expected as this should be relatively independent of the manufacturer's choice of evaporative control technology. Considering the fuel which is now lost to the atmosphere by evaporation, but which could be burned in the engine with evaporative control, one can describe a possible potential for conserving fuel. Most evaporative control systems expected to be used to meet either a 6.0 or 2.0 g/test standard use a canister containing activated carbon. Fuel vapors from the fuel tank and the carburetor fuel bowl are vented to this canister during periods when the engine is not running. These fuel vapors are purged out of the canister during vehicle operation and burned in the engine. Reduction of the evaporative emission standard from 6.0 g/test to 2.0 g/test will reduce the amount of vapors lost to the atmosphere by .45 g/mi on the average. If a vehicle lifetime is assumed to be 100,000 miles, then this reduction would, over the lifetime of the vehicle, amount to approximately 15 gallons of fuel not lost to the atmosphere. At current gasoline prices this would suggest a potential savings of approximately $9 over the lifetime of the vehicle. However, this estimate assumes that all of the fuel trapped would be used effi- ciently. The actual use of this trapped fuel would probably be somewhat inefficient depending on the evaporative control system used, and therefore, savings would in all likelihood be much less than $9. ------- -53- However, any savings here would help offset the consumer-borne cost of the control system discussed in the next chapter. 2. Hydrocarbon Reactivity Because of their reactions in photochemical processes, hydrocarbons are linked with the adverse health effects of photochemical oxidants. This link with oxidants is the major basis of hydrocarbon emission regulation. "Hydrocarbon Reactivity" is the term used to denote the relative ability of a specific hydrocarbon to participate in photochemical reaction processes. For instance, a specific hydrocarbon may be in- volved in several reactions in the photochemical process, depending on its concentration, structure and oxidation state. The end products of these reactions and the consequent intensity of symptoms generated, such as eye irritation or plant damage, are largely dependent on the nature of the hydrocarbon involved. The hydrocarbon compounds that are found in evaporative emissions are reactive. During instances when evaporative hydrocarbons remain in the atmosphere for a day or more such that there is sufficient reaction time, they may be more reactive than exhaust hydrocarbons. Thus, the impact of this regulatory action on ambient air quality may be even somewhat greater than the reduction in overall hydrocarbon emissions indicates. ------- -54- 3. Exhaust Hydrocarbon Emission Interaction Depending on the design of the evaporative control system used to meet a 2.0 g/test standard, an interaction causing additional exhaust hydrocarbons and carbon monoxide to be generated from the combustion process can occur due to the purging of additional evaporative emissions into the engine. Whether or not this occurs is dependent on the rate and the total amount of hydrocarbons purged into the engine and the operating condition of the vehicle when purging takes place. While the test procedure is designed to assess potential evaporative emission- exhaust emission interactions, these interactions need not occur with proper utilization of existing control technology. Therefore, this rulemaking is not expected to have any measurable effect upon exhaust emissions. 4. Water Pollution and Solid Wastes The problem of evaporative emissions is one which affects the air quality, and it is not one which should have any significant effect on water quality. The reduction of evaporative emissions should have very little positive and no negative effects on water quality. Similarly, no effect on the quantity or quality of solid wastes is expected. This is equally true of the control of hydrocarbon emissions by the implemen- tation of the alternatives discussed dealing with controlling exhaust hydrocarbons. ------- -55- Chapter V Costs of Control and Its Impact on Consumers, Industry, and Government A. Impact on Consumers From the consumer's perspective the costs of controlling emissions consists of two elements. First, there is a charge levied on the consumer by the vehicle manufacturer to cover the costs of the emission control system. This is usually done by increasing the "sticker" price of the vehicle. Secondly, the consumer must pay for any additional cost to operate and/or maintain the vehicle due to any change made to the vehicle, aimed at reducing emissions. 1. Initial Costs The initial cost to the consumer which is reflected in a higher sticker price, is due to the cost of research and development, production, design, raw materials, manufacturing and markup (profit) of any required component change or addition to the vehicle. For Alternative Action III, this cost will depend on the control strategy adopted by a manufacturer to meet a 2.0 g/test standard in 1981. A study of the cost of achieving a 2.0 g/test emission level has been conducted by Exxon Research and Engineering Company under EPA ------- -56- Contract No. 68-03-2172.^ In this study, six 1973-75 production vehicles which represented the four major U.S. Light Duty Vehicle manu- facturers and two foreign manufacturers, were modified in order to reduce evaporative emissions. Costs for the required modifications were then estimated. The resulting manufacturer's sales weighted retail price increase to reduce evaporative emissions from a 6.0 g/test level to a 2.0 g/test level on each vehicle was $1 per vehicle. / A\ A further study done by EPA evaluated the cost of manufacturer developed control systems which have given test results of less than 2.0 g/test. The component costs used were the same as those used in the Exxon study. This evaluation concluded that the manufacturer sales weighted retail price increase would be $5 per vehicle to go from a 6.0 g/test level to a 2.0 g/test level. It can, therefore, be concluded that the incremental retail price increase will be between $1 and $5 per vehicle. This is in agreement with EPA's original estimate of $3.70. In order to estimate a wholesale price increase (to be used in calculating the drop in vehicle sales), the estimated retail price increase ($1 - $5 per vehicle) must be reduced by 22%. This value is ^Clarke, P.J., "Investigation and Assessment of Light-Duty Vehicle Evapo- rative Emission Sources and Control", Exxon Research and Engineering, EPA Contract //68-03-2172, June 1976. (2) "Cost Effectiveness of a 2.0 g/test SHED Evaporative Standard for Light- Duty Vehicles and Trucks," Issue Paper by Michael W. Leiferman, U.S. EPA, Ann Arbor, Michigan, June 1976. ------- -57- based 011 the historical dealer discount structure for General Motors.* The wholesale price increase would therefore be $0.80 - $3.90 per vehicle. Table V-l shows the total cost to U.S. consumers between 1980 and 1981 based on a retail price increase of $1 - $5 per vehicle. This cost was multiplied times the projected sales figures for light-duty vehicles and light-duty trucks during those years. The projected sales of light- duty vehicles were generated by an econometrics model. Since similar econometrics modeling of light-duty trucks has not been made at this time, it was assumed that the light-duty truck market would be 25% of the size of the light-duty vehicle market, as it was in 1974. The trend in truck sales in the last few years shows an increasing percentage of light-duty trucks being purchased. Thus, the assumption that light-duty trucks will continue to be 25% of the size of the light-duty vehicle market is probably inaccurate, but it should not cause large errors in the estimates of overall LDV plus LDT sales. One limitation of the analysis shown in Table V-l is the assumption that the costs of the pollution control system will remain constant over time (constant dollar assumption). Tending to reduce consumer costs are the cost saving engineering developments which are likely to occur as manufacturers gain more experience in using the system. Tending to increase costs to the consumer are the persistent increases in material * Discount data presented in Automotive News, August 10, 1975. ------- Table V-l Projected Sales and Incremental Cost of Control for a 2.0 g/test Standard U.S. Sales (millions) Incremental Cost to Year LDV1 LDT2 LDV & LDT the consumer 1981 12.0 3.0 15.0 15-75 1982 11.6 2.9 14.5 14-72 1983 11.4 2.8 14.2 14-71 19844 11.4 2.8 14.2 14-71 4 1985 11.4 2.8 14.2 14-71 1 "Data Resources Inc. - U.S. Long Term Bulletin - Winter 1976", p. 20. 2 Predicted values are based on the assumption that LDT market will be 25% of the size of the LDV market as it was in 1974 as reported in "Automotive News Almanac", 1975. 3 Based on a retail cost increase of $1 - $5 per vehicle for a 2.0 g/test standard in 1980. 4 Sales projections for 1984 and 1985 were not available. It was assumed, therefore, that sales would be the same as in 1983. ------- -59- costs that are likely to occur in the future. Accurate estimates of how these factors will cause costs to change are virtually impossible to make and thus the constant dollar assumption is required. Another factor which should be considered in estimating aggregate costs of pollution control is the assumption that essentially all light- duty trucks and passenger cars will use gasoline engines. Currently such an assumption is valid as practically all light-duty vehicles and light- duty trucks do use gasoline engines. However, some manufacturers are introducing Diesel engines in light-duty vehicles and light-duty trucks. The extent to which Diesel engines are used in the future could tend to reduce EPA estimates of the aggreate costs of control, as Diesel fuels have a very low volatility, resulting in very low evaporative emissions. It should be noted at this point that this regulatory action does not include Diesel powered light-duty trucks and light-duty vehicles for this reason. 2. Fuel Consumption The control devices used for the containment of evaporative hydro- carbon emissions present no degrading effect on fuel economy and depending on the control strategy used, a cost savings due to fuel saved could occur. As was discussed in Chapter IV, a potential savings of 15 gallons of fuel over the vehicle lifetime could occur due to the trapping and subsequent burning of fuel vapors in the engine. At current gas prices of around $.60 per gallon this represents a potential lifetime savings ------- -60- of $9. As was pointed out earlier, only a fraction of that amount could actually be expected, but any savings would help offset the initial cost to the consumer. Since it is unknown how much could actually be saved, it will be assumed that no savings will be realized. 3. Maintenance Costs Current systems are designed to last the lifetime of the vehicle without replacement or major maintenance of system components. Thus, for systems expected to be used to meet a 2.0 g/test standard, no maintenance cost should be encountered. Therefore,' the initial cost to the consumer is the only cost he should have to bear as a result of this rulemaking. B. Impact on Industry Manufacturers are faced with two tasks as a result of this rulemaking. First, they must adapt existing technology into specific hardware to accommodate their various models of light-duty vehicles and light-duty trucks. Secondly, they must minimize the cost of additional control devices and/or modifications to existing devices in order to minimize the impact on sales. 1. Sales The first task is the most critical. Evaluations have been made ------- -61- which show that present technology is available and that there is 2 sufficient lead time for manufacturers to meet a 2.0 g/test standard for essentially all 1981 model year vehicles. Increased production costs to the manufacturer will be passed on to the consumer as stated earlier. Thus, the cost to the motor vehicle industry will not be due to the cost of controlling hydrocarbons, but will instead be due to any decrease in sales due to adverse consumer reaction to increased sticker prices. Generally, it can be stated that sales are inversely proportional to price changes. The degree of sensitivity to price changes is indicated by the price elasticity index. A price elasticity, for example, of .3 would indicate that a 1% increase in price would result in a 0.3% decrease in sales. The price elasticity 3 for motor vehicles is .88. In 1974, 9,486,838 factory sales of light-duty vehicles and light- duty trucks were made by U.S. manufacturers for a total wholesale value of $29.8 billion. Thus, the average wholesale price of a 1974 light- duty vehicle or light-duty truck was $3,140. Based on this unit price, the wholesale price increase due to evaporative controls, and a price * "Technical Feasibility of a 2.0 g/test SHED Evaporative Emission Standard for Light-Duty Vehicles and Trucks", Issue Paper by Michael W. Leiferman, U.S. EPA, Ann Arbor, Michigan, June 1976. 2 "Lead Time Requirement for an Evaporative Emission Standard for 2.0 g/test for Light-Duty Vehicles and Trucks", Issue Paper by Michael W. Leiferman, U.S. EPA, Ann Arbor, Michigan, June 1976 (Revision November 1977). "3 "The Effect of Tax and Regulatory Alternatives on Car Sales and Gasoline Comsumption," Prepared for CEQ by Chase Econometric Associates, May 1974, p. 4. ------- -62- elasticity index of 0.88, the % drop in sales can be predicted. Table V-2 summarizes such an evaluation. Table V-3 shows the drop in actual sales for 1981 through 1985 for an assumed price elasticity of 0.88. As can be seen from Tables V-2 and V-3 the expected drop in sales due to the implementation of a 2.0 g/test standard in 1981 is very small compared to overall sales. 2. Competitive Structure The effects of these regulations on the competitive structure of the light-duty vehicle or light-duty truck industries are likely on the whole to be minimal. Historically, the market shares shown in Tables III-2 and III-3 in Chapter III have been quite stable and a minor price increase of .12% would not be expected to have any effect. 3. Developmental and Certification Costs The manufacturer's cost of developing and implementing specific control systems has not been determined. The developmental cost per vehicle should be very small compared to the $1 - $5 estimated vehicle retail price increase. The cost of certifying vehicles at 2.0 g/test rather than a 6.0 g/test emission level should be the same because the test procedures and number of tests required should not change. Thus, the incremental increase in certification costs will be zero. ------- -63- Table V-2 % Drop in Sales Due to Evaporative Controls % increase Wholesale ^ in Wholesale % Drop ^ Action Taken Price Increase ($) Price in Sales Alternative Action I -0- -0- -0- (No Action) Alternative $.80- .03- .02- Action III $3.90 .12% .11% (2.0 g/test Std. in 1981) 1974 dollars 2) Based on price elasticity of 0.88 from "The Effect of Tax and Regulatory Alternatives on Car Sales and Gasoline Consumption," Prepared for CEQ by Chase Econometric Associates, May 1974, p.4. ------- -64- Table V-3 Drop in Actual Sales of Light-Duty Vehicles and Trucks Due to Evaporative Controls from 1981 to 1985 Action Taken 1981 1982 1983 1984 1985 Alternative Action I -0- -0- -0- -0- -0- (No Action) Alternative 3,200- _ 3,400- 3,200- 3,200- 3,200- Action III 16,000 ~ 16,000 16,000 16,000 16,000 (2.0 g/test Std. in *81) Based on sales projections presented in Table V-l and a price elasticity of 0.88 from "The Effect of Tax and Regulatory Alternatives on Car Sales and Gasoline Consumption," Prepared for CEQ by Chase Econometric Associates, May 1974, p. 4. ------- -65- 4. Potential Impact on Employment: No production plant closures by any manufacturer of light-duty vehicles or light-duty trucks is anticipated due to the implementation of these regulations. The decrease in sales discussed earlier is expected to be very small and therefore its impact on employment at worst is expected to also be very small. It is likely that increased engineering and manufacturing effort will be required to provide the new control systems. However, it should have a marginal impact on the size of the overall work force. Generally, the control devices required will be modifications or redesigns of existing devices and, thus, the major work effort will be in the engineering and skilled trades labor force. C. Government Costs This rulemaking will not affect the Government's cost of vehicle certification, since the test methology is unchanged, and the number of tests are essentially independent of the level of control. D. National Annualized Cost and Capital Investment over 5 Years The national annualized cost of attaining a 2.0 g/test standard for 1981 and subsequent model year vehicles is estimated to be between $11 ------- -66- million* and $56 million* by the fifth year of implementation, 1985. Since there is no change in operating or maintenance cost associated with this action, the annualized cost is based entirely upon the annualized cost of five model years of control systems for cars and light-duty trucks assuming a 10 year useful life (i.e., the value of the vehicle at the end of 10 years is zero) and a 10% annual interest rate. The national capital investment over the first five years is estimated to total between $72 million* and $360 million*. This compares to a projected $230 billion* in retail sales of new cars and light-duty trucks during the same time period, i.e., 1981 - 1985. * 1974 dollars ------- -67- Chapter VI Cost Effectiveness One of the goals of the Mobile Source Air Pollution Control activity is to obtain clean air at minimum cost to society. For effectiveness in implementing this goal, a mechanism is needed by which the relative cost and effectiveness of the various mobile source emission control strategies can be assessed. Cost effectiveness (CE) is such a mechanism which assesses the cost per unit of desired result. In this case, cost effective- ness is expressed in terms of dollars per ton of pollutant prevented from entering the atmosphere. Once cost effectiveness is calculated for a series of control strategies, the strategies can be compared. The most efficient strategy is the one with the lowest cost necessary to control a ton of pollutant. In addition to the cost effectiveness of control, the amount of control available by the proposed strategy and the amount of control required to meet the air quality goal must also be known. A given strategy may be very cost effective but not provide much pollution control. Alternately, a strategy might provide a large amount of pollution control but not be cost effective. Of course, the strategies which are both cost effective and which control large amounts of pollutants are implemented first. Other strategies are implemented as needed to meet air quality goals. The most appropriate measure of the societal cost of control is the cost that the consumer must bear. This cost consists of an ------- -68- initial cost caused by an increase in the manufacturer's suggested retail price and a continuing cost which consists of the support or maintenance cost per unit of operation (e.g., per mile) for the life of the vehicle. For this rulemaking, the incremental operating costs are expected to be zero. The initial cost will consist of the cost to the manufacturer to attain the required control plus a mark-up (profit) which is at the discretion of the manufacturer. The measure of effectiveness of control can most appropriately be determined by comparing the emission per unit of operation (per mile) from controlled and uncontrolled vehicles. The difference between the two represents the effectiveness of the control strategy in terms of mass per unit of operation (g/mile). The cost effectiveness (CE), then, is the ratio of the total vehicle cost to the total pollution controlled: CE ($/ton) Cost + (Operating Cost, $/mile) x (Total lifetime distance, miles) (Reduction in emissions, tons/mile) x (Total lifetime distance, miles) For this cost effectiveness analysis, the assumption was made that an average vehicle or truck will last 10 years and travel 100,000 miles during that time. The assumption used for other mobile source control strategies, that the deterioration factor will remain constant over the 100,000 mile life of the vehicle, will be used here. This means that, when the vehicle meets the certification requirements at 50,000 miles, the average emission rate for the entire 100,000 mile period will be at or below the standards. ------- -69- The g/mi reduction in emissions for light-duty vehicles and light- duty trucks is shown in Table VI-1. For the cost effectiveness analysis it will be assumed that by 1990 all vehicles will be emitting at an evaporative level of 2.0 g/test, and at statutory exhaust hydrocarbon emission levels (0.41 g/mile). This assumption is based on the fact that almost all vehicles will have been certified at those levels by 1990 and the proportion of vehicles old enough to have been certified at higher levels will be relatively small. Table VI-2 gives the cost and cost effectiveness for controlling a light-duty vehicle or truck to the various levels discussed. Also included are the cost effectiveness of the Evaporative Emission Regulations for 1978, the cost effectiveness of going to the statutory exhaust HC level for light-duty vehicles, and the cost effectiveness of an Inspection- Maintenance program. These other control strategies are included for additional comparison with the alternative evaporative control actions to show their relative cost effectiveness. The cost effectiveness of alternative action III and achieving statutory exhaust HC levels is in each case based on the composite LDV, LDT reductions from Table VI-1 and the costs shown. ------- Table VI-1 Reductions in HC Emissions from Light-Duty Vehicles and Light-Duty Trucks Light-Duty Vehicles g/mi g/mi reduction Light-Duty Trucks g/mi g/mi reduction Composite.. LDV + LDT g/mi g/mi reduction Current Evaporative Emission levels (6 g/test Evap. Stand- ard) 0.60 0.60 0.60 2 g/test Evap. Stand- ard 0.15 0.45 0.15 0.45 0.15 0.45 Current LDV Exhaust Emission Standards 1.50 Statutory LDV Exhaust Emission Level 0.41 1.09 Based on vehicle miles travelled by light-duty vehicles being 87.2% of total vehicle miles travelled by light-duty vehicles and light-duty trucks. ------- -71- Table VI-2 Unit Price and Cost Effectiveness of Alternative Actions Alternative Action I (No Action) Alternative Action III (2.0 g/test Std. in 1981) 1978 Evap. Regulations"^" LDV Exhaust HC Emissions to Statutory Level 2 Unit Price of Control $1 - $5 $ 7.30 $62 - $164 Cost Effectiveness $/ton HC 20-100 50 500-1400 Inspection Maintenance' 58-408 "Environmental and Inflationary Impact Statement - Revised Evaporative Emission Regulations for the 1978 Model Year", Aug. 1976. 2 Source: "Analysis of Some Effects of Several Specified Alternative Automobile Emission Control Schedules", prepared jointly by EPA, DOT and FEA, April 8, 1976, p. 15. Assumes cost to achieve statutory levels for CO and HC are equally split, (i.e., 50% for CO, 50% for HC). Large range is due to the large range of expected lifetime costs (which in- cludes initial costs, fuel costs, and maintenance costs). 3 Source: Internal EPA memo from M. Williams to J. Lane, Aug. 18, 1975, assuming a failure rate of 20%. ------- -72- Chapter VII Other General Considerations A. Irreversible and Irretrievable Commitment of Resources No irreversible and irretrievable commitment of resources is caused by this rulemaking. This rulemaking action will not cause any fuel consumption penalty, and commitment of resources such as steel, aluminum, and carbon for the evaporative emission control systems is so small as to be completely over-shadowed by normal market fluctuations. B. Relationships of Short-Term Uses of the Environment and Maintenance and Enhancement of Long-Term Productivity This rulemaking will result in immediate reduction of hydrocarbon emissions from new light duty vehicles and light duty trucks and, as older vehicles are replaced with newer vehicles meeting the revised evaporative emission standards, will result in significant reductions in levels of oxidants in the ambient air. This reduction will also be beneficial and aid in the long term maintenance of ambient air quality levels. No short term or long term losses to the environment are associated with this rulemaking. The timing and stringency of the standards are aimed entirely at the maximum reduction in evaporative hydrocarbon emis- ------- -73- sions in the shortest time period that will not result in undue economic dislocation to the light duty vehicle and light duty truck industry. ------- -74- Chapter VIII Problems and Objections Raised by Federal, State, arid Local Agencies, and Other Persons Comments were received on the Draft Environmental Impact Statement for the Revised Evaporative Emission Regulations for 1978 and Subsequent Model Years from private industry, the Council on Wage and Price Stabil- ity, and the Department of Commerce. The comments regarding a 2.0 g/test standard focused on the issues of Feasibility, Lead Time, Cost, and Cost Effectiveness of a 2.0 g/test standard. The comments on the issues of Feasibility, Lead Time, and Cost were analyzed in detail in the Summary and Analysis of Comments paper supporting this rulemaking 12 3 and in three issue papers on those subjects. ' ' The following is a summary of those discussions: 1. Test results on production and modified vehicles show that an evaporative emission standard of 2.0 g/test (including stabilized back- ground) is technically feasible; "Technical Feasibility of a 2.0 g/test SHED Evaporative Emission Standard for Light-Duty Vehicles and Trucks," Issue Paper by Michael W. Leiferman, U.S. EPA, Ann Arbor, Michigan, June 1976. 2 "Lead Time Requirement for an Evaporative Emission Standard of 2.0 g/test for Light-Duty Vehicles and Trucks", Issue Paper by Michael W. Leiferman, U.S. EPA, Ann Arbor, Michigan, June 1976 (Revision November 1977). 3 "Cost Effectiveness of a 2.0 g/test SHED Evaporative Standard for Light-Duty Vehicles and Trucks", Issue Paper by Michael W. Leiferman, U.S. EPA, Ann Arobr, Michigan, June 1976. ------- -75- 2. Due to the time requirement for equipment definition, design, development and production, the proposed 1979 implementation date is impossible and implementation for the 1980 model year appears impractical. It is recommended that the 2.0 g/test standard be promulgated for the 1981 model year; 3. The incremental sales weighted increase in the retail vehicle price is expected to be between $1 and $5 per vehicle. Comments received on the issue of cost effectiveness from the Council on Wage and Price Stability have not been analyzed in the above mentioned documents, and will, therefore, be dealt with in detail here. The following is a summary of the comments from the Council on Wage and Price Stability: "The Council has reviewed the EPA's economic analysis and has concluded that it indicates that these regulations are, for the most part, cost effective. There are, however, several points that the Council would like to see addressed by the EPA before these standards are promulgated." There is some disagreement regarding the increased price that will result from the 2.0 g/test standard. EPA estimates the cost at $11, but one manufacturer (Chrysler) gave the Council an estimate of $50 (costs to go from current levels to 2.0 g/test level). If the cost of a 2.0 g/test system is $50, the incremental cost in ------- -76- going from 6.0 g to a 2.0 g standard would be $854/ton as opposed to the $74/ton incremental cost estimate of EPA. The Council urges that EPA resolve this cost effectiveness issue before a decision is rendered on the 2.0 g/test standard. Cost data provided by the EPA for the incremental cost per ton of hydrocarbon pollutants removed includes $29/ton for HDV interim exhaust emission standards, $226/ton for LDT interim exhaust emission standards, $303 for LDV federal interim exhaust emission standards, and $515/ton for the 1978 federal statutory levels for LDV's and LDT's. In view of these estimates, it would seem more cost effective to impose the stricter HDV exhaust emissions standards before imposing a 2 g/test evaporative emission standard on LDVs and LDTs. "The Council would also urge EPA to consider the economic feasibility of a 2 g/test standard using a SHED procedure that includes background emissions. ...In other words, it is the Council's position that this technical element of the proposed standards be evaluated in a cost effective manner and that the benefits be weighed against the costs before a definitive decision on including background emissions in a 2 gram/test standard using SHED is made." "Another issue that the Council urges EPA to consider more explicitly in its deliberations on the 2 g/test standard is whether or not the incremental benefits justify the incremental costs...The council would ask whether or not these types of benefits (i.e. , million tons per year of reduced hydrocarbon emissions) could be converted ------- -77- into terms that would be more meaningful to the general public. ...The Council would suggest, if feasible, that the benefits be translated into such terms as a reduction in certain types of illness or at least in terms of the reduced risk of contracting certain types of illnesses." Discussion The first concern raised was that the cost estimate of $50 ($44 incremental) from Chrysler was much higher than EPA's original cost estimate of $11 ($3.70 incremental). This issue was dealt with in detail in the Analysis of Comments and in the issue paper on the cost of a 2.0 g/test standard. It was shown in those papers that the cost estimate from Chrysler was much higher than what will be necessary to control evaporative emissions to a 2.0 g/test level. The predicted average incremental retail cost increase was $1 to $5 which is in agreement with EPA's original estimate of an incremental retail cost increase of $3.70 (from $7.30 to $11). The calculated cost effectiveness of reducing the evaporative emission standard from 6.0 g/test to 2.0 g/test is $20 to $100 per ton of hydrocarbon removed (based on a $1 to $5 retail price increase). Therefore, reducing the evaporative emission standard to 2.0 g/test is expected to be more cost effective than any other control strategy currently being considered except for the HDV interim exhaust emission ------- -78- standards which has a cost effectiveness of $29 per ton of HC removed. If the ultimate cost effectiveness of a 2.0 g/test standard is actually $20 per ton of HC removed, the 2.0 g/test standard would be the most cost effective action of any currently considered strategy for controlling mobile source HC emissions. It should be further pointed out that the HDV interim exhaust emission standards are being implemented in 1979. Therefore, they are as the Council suggests, being imposed before imposing a 2.0 g/test evaporative emission standard on LDV's and LDT's in 1981. EPA's analysis of the cost of a 2.0 g/test standard included measurement of stabilized background emissions. Manufacturers can either use old vehicle bodies or artifically aged new vehicles by exposing them to elevated temperatures, removing vinyl and plastic components, etc. Manufacturers will be able to obtain vehicles with low stabilized background levels by such means whether or not an allowance for backgrodund levels is made. It is EPA's position that the manufacturer can and will obtain low background test vehicles. The Council on Wage and Price Stability has also requested that a cost benefit analysis be performed which would convert .the tons/year reduction into terms more meaningful to the public. EPA would very much like to be able to translate incremental emission reductions into incremental health effects such as reduced illnesses, etc. However, the relationship between emission reductions and ambient air quality and effects upon human health are not sufficiently well known to provide ------- -79- reliable quantification of the expected health benefits. Complicating this further is the different mixtures and levels of pollutants in cities across the Nation. The National Ambient Air Quality Standards were established in order to quantify the level of pollutants in the ambient air above which there were observed adverse health and welfare effects. It is to the goal of bringing the quality of the air in U.S. cities to such acceptable levels that the evaporative emission standards are addressed. That a large number of Air Quality Control Regions are expected to exceed the standards in 1985 and later and that the proposed 2.0 gram/test standard provides a significant reduction in emissions at a cost-effectiveness level that is very favorable compared to other ongoing strategies is considered sufficient justification for the action. ------- |