United States Air and Radiation EPA420-R-00-004
Environmental Protection March 2000
Agency
vxEPA Final Regulatory
Impact Analysis
Phase 2 Final Rule:
Emission Standards for
New Nonroad Handheld
Spark-Ignition Engines
At or Below 19 Kilowatts
> Printed on Recycled Paper
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EPA420-R-00-004
March 2000
2
for
At or 19
Assessment and Standards Division
Office of Transportation and Air Quality
U.S. Environmental Protection Agency
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TABLE OF CONTENTS
Chapter 1: Introduction 1
Chapter 2: Exhaust Emission Test Cycle and Test Procedures 5
2.1 Introduction 5
2.2 Phase 1 test procedures and test cycle 5
2.3 Agency review of the Handheld Engine Test Cycle 5
Chapter 2 References 9
Chapter 3: Technologies and Standards 10
3.1 Introduction 10
3.2 Technologies 10
3.2.1 Compression Wave Technology (With and Without Catalyst) 10
3.2.2 Stratified Scavenging with Lean Combustion (With and Without Catalyst)!6
3.2.3 Conversion of Handheld Two-stroke Designs to Four-stroke Designs ... 20
3.2.4 Application of Catalytic Converters to Handheld Engines 24
3.2.5 Internal Two-stroke Engine Redesign With a Catalyst 38
3.2.6 Spark-Ignition Technology 41
3.2.7 DIPS 44
3.3 Exhaust HC+NOx Standards for Class IE, IV and V Engines 44
Chapter 3 References 49
Chapter 4: Technology Market Mix and Cost Estimates 50
4.1 Engine Technology Market Mix Estimates 51
4.1.1 Phase 1 Market Mix 51
4.1.2 Phase 2 Market Mix 53
4.2 Variable Hardware and Production Cost Estimates per Engine Class 58
4.3 Fixed Production and R&D Cost Estimates per Engine Class 64
4.4 Equipment Cost Estimates 69
4.5 Fuel Savings and Impacts on Performance 72
4.5.1 Fuel Consumption 72
4.5.2 Power 74
4.5.3 Oil Consumption 74
Chapter 4 References 76
Chapter 5: Compliance Program Costs 77
5.1 Background 77
5.1.1 Engine Families 77
5.1.2 Assumed Costs 77
5.2 Certification 78
5.3 Averaging, Banking and Trading 79
5.4 Production Line Testing 80
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5.4.1 Rationale for Production Line Testing 80
5.4.2 Cost Inputs and Methodology 80
5.5 Cost Summary Tables 81
Chapter 5 References 85
Chapter 6: Environmental Benefit 86
6.1 Estimated Emissions Reductions 86
6.2 Air Quality Benefits 91
6.2.1 Ozone 91
6.2.2 Air Toxics 94
6.2.3 CO 97
6.2.4 Visibility and Regional Haze 98
Chapter 6 References 100
Chapter 7: Analysis of Aggregate Costs 103
7.1 Aggregate Cost Analysis for the Period 2002 to 2027 103
7.1.1 Uniform Annualized Costs 104
7.1.2 Average Cost Per Equipment 109
7.2 Cost-effectiveness 110
7.3 20-Year Cost Analysis Ill
7.4 Fuel Savings 115
Chapter 7 References 118
Chapter 8: Assessment of Impacts on Small Entities 119
8.1 Introduction and Methodology 119
8.1.1 Regulatory Flexibility 119
8.1.2 Methodology 119
8.2 Impact on Engine Manufacturers 120
8.2.1 Small Business Engine Manufacturer Impacts 120
8.2.2 Expected Technologies/Costs 120
8.2.3 Expected Impact on Small Business Entities 121
8.2.4 Sales Test for Engine Manufacturers 121
8.2.5 Flexibilities Case 122
8.3 Impact on Equipment Manufacturers 122
8.3.1 Number of Small Manufacturers 122
8.3.2 Impact on Equipment Manufacturers 123
8.3.3 Possibility of Cost Passthrough 123
8.4 Estimation of Impacts on Small-Volume Equipment Manufacturers 123
8.4.1 Base Case-No Flexibilities 123
8.4.2 Flexibilities Case 124
8.5 Conclusions 126
8.6 Outreach Activities 126
Chapter 8 References 127
Chapter 9: Useful Life and Flexibility Supporting Data 128
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9.1 Information on Useful Life 128
9.1.1 Handheld Useful Life Estimates from PPEMA 128
9.1.2 Handheld Useful Life Estimates from CARS 129
9.1.3 Small Engine Equipment Usage Estimates used by EPA 129
9.1.4 Phase 2 Useful Life Categories 134
9.2 Background for Choice of Small-Volume and Small-Family Cutoffs 134
9.2.1 Small-Volume Handheld Engine Manufacturers 134
9.2.2 Small-Volume Engine Family 135
9.2.3 Small-Volume Equipment Manufacturer 136
9.2.4 Small-Volume Equipment Model 136
Chapter 9 References 139
Appendix A: Industry Characterization
Appendix B: Phase 1 Database Summary, Manufacturer Summary, Sales Estimate
Methodology
Appendix C: Compliance Cost Estimate Spreadsheets
Appendix D: Model Year 2000 Small Off Road Engine Certification Data from the California
Air Resources Board
Appendix E: Cost and Cost-Effectiveness Spreadsheets
Appendix F: NONROAD Emissions Model Tables
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Chapter 1: Introduction
Chapter 1: Introduction
This Final Regulatory Impact Analysis ("Final RIA") contains the supporting
information and analysis for the Phase 2 Final Rulemaking for handheld engines and for
Class I-A and I-B nonhandheld engines. The information was gathered from number of sources
including the Regulatory Negotiation (Reg/Neg) process between 1993 and 1996, industry
meetings between 1993 and 2000, EPA contracts, comments to the January 1998 Notice of
Proposed Rulemaking (NPRM) and the July 1999 Supplemental Notice of Proposed Rulemaking
(SNPRM), and discussions with manufacturers and inventors. The Reg/Neg task groups
provided information on test procedure, technologies, compliance programs, and costs. Industry
provided data on the in-use deterioration characteristics of Phase 1 engines from their own test
programs and on costs of technologies to the consumer. EPA contracts provided information on
available technologies, costs of technology changes, and regulatory impacts for small entities.
Comments to the January 1998 NPRM provided information on a number of issues including the
timeframe for certain technologies, costs of technologies, costs of testing, the need for additional
nonhandheld classes, etc. Discussions with manufacturers and inventors since the publication of
the January 1998 NPRM and comments on the July 1999 SNPRM provided EPA with the latest
information on emission reduction technologies and costs. All of this information is utilized in
the chapters of this Final RIA as described.
Chapter 2 contains a summary of the work done by the Test Procedure Task Group of the
Regulatory Negotiation Committee, as it relates to this rule. The work by the Task Group
included an investigation into the differences in emission results when small engines1 are tested
on steady state and transient test cycles. The outcome for this rule is the use of the Phase 1
steady state test procedure with an adjustment in the weightings for the handheld test procedure
changed from 90/10 to 85/15 for Mode 1 and Mode 2, respectively.
Chapter 3 presents the supporting rationale for the level of the Phase 2 standards being
adopted including a comparison of cost estimates for various technologies. Research on
technologies for handheld engines has focused on information obtained since Phase 1 was in the
process of being finalized. Preliminary work was completed by several sources including the
Technology Subgroup of the Regulatory Negotiation and an EPA work assignment with SwRI in
19962. The Technology Subgroup of the Regulatory Negotiation investigated a number of engine
1 The small engines were tested in Phase 1 and "future technology" configurations.
2 The work assignment with SwRI focused on investigation of currently produced
Phase 1 engines and identified the features of low and high emitting handheld and
nonhandheld engines.
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Chapter 1: Introduction
emission reducing technologies for the exhaust system and fuel system of Small SI engines. The
results of the testing during these years revealed that some technologies required other engine
improvements to be achieved prior to their use (such as catalysts), some technologies were
currently too expensive compared to the price of the engine (such as traditional fuel injection on
a handheld engine) and some were in the pre-prototype stages and required additional
development before the prototype stage (such as an accelerator pump on a chainsaw engine).
Standards being discussed were 30 percent below the respective Phase 1 standards for each class
(210, 172,116 for Classes HI, IV and V, respectively).
Most recent discussions with manufacturers, from 1998 to 2000, revealed potential
technologies for meeting the California Air Resources Board (ARB) HC+NOx standard of 54
grams per horsepower-hour (g/hp-hr) (i.e., 72 grams per kilowatt-hour (g/kW-hr)) for small
spark-ignition engines up to 65cc. Technologies include the compression wave technology,
stratified scavenging with lean combustion, and mini four-stroke engines, as well as internal
engine improvements with a catalyst. These technologies form the base of the technologies to
meet EPA's final standards of 50 g/kW-hr for Classes HI and IV and 72 g/kW-hr for Class V.
For Classes in and IV, EPA expects manufacturers to use compression wave technology with and
without a catalyst, stratified scavenging with lean combustion with a catalyst, and the mini four-
stroke engine. For Class V, EPA expects manufacturers to use stratified scavenging with lean
combustion and the compression wave technology.
Chapter 3 also includes information on technologies and related standards for Class I-A
and Class I-B. Information was collected in discussions with manufacturers after the January
1998 NPRM was published, comments on the July 1999 SNPRM, and a comparison of the
standards to the program adopted by the California ARB. In the California ARB program,
engines under 65cc have a unique standard compared to those over 65cc. No distinction is made
between handheld and nonhandheld engines in the ARB program as had been done in earlier
standards. Given the market structure of the small engine industry, EPA is of the opinion that a
harmonized approach, with Class I-A, as allowed in our rulemaking structure, would benefit all.
Class I-B serves to allow the smaller Class I engines a higher standard due to the difficulty of
smaller engines to meet the Phase 2 standard.
Chapter 4 contains the data and analysis behind the estimated costs for the technologies
for this final rule. Cost information for handheld technologies was submitted to EPA by industry
groups and individual companies and through a work assignment with ICF, Incorporated (Docket
ItemIV-A-013).
The impact of technology changes to the Phase 1 engine families are based on review of
3Unless indicated otherwise, docket references in this document are to Docket A-96-55.
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Chapter 1: Introduction
EPA's Phase 1 certification database and the regulatory programs for handheld engine
manufacturers being adopted for Phase 2. The number of handheld engine families that are
expected to be improved are estimated based on the use of ABT by the engine manufacturers4
and the comparison of their deteriorated5 Phase 1 emission rates to the Phase 2 standard with a
10 percent compliance margin6. Technology improvements for handheld engines include mini
four-stroke, stratified scavenging with lean combustion and a catalyst, and compression wave
with and without a catalyst. The estimated costs for each technology are also presented in this
chapter. Costs for Class I-A standards are minimal as Class I-A allows handheld engines to be
used in nonhandheld applications. Therefore the technology costs are attributed to the handheld
rulemaking. Class I-B costs are minimal for the standard allows existing engines to meet the
standards without modification. The only costs are those that are attributed to certification and
other related applicable costs which are the same as those for other engine families.
Chapter 5 contains the details of the compliance program and outlines the estimated costs
of the program. The compliance program includes certification and production line testing. One
major assumption made here for the program is the useful lives that would be chosen by engine
manufacturers for their engine families. This was done based on the market focus of the engine
manufacturers from low cost consumer to medium quality to high use professional. Appendix C
contains the spreadsheets for this analysis.
Chapter 6 contains a description of the methodology used to calculate anticipated
emission reductions and fuel savings as a result of this rulemaking. Appendix F contains related
data used in EPA's NONROAD Model for estimating the inventory reductions and fuel
consumption.
4 The ABT calculation is performed for each engine manufacturer and it is based on
information in the Phase 1 certification database (engine families, emission data
and production estimates.
5 Deterioration rates and functions are obtained from industry supplied data for both
nonhandheld and handheld industries.
6 This analysis projects that manufacturers will claim FELs that are 10 percent
below the standard. This assumption is made based on the conclusion that, as
manufacturers develop and implement low emitting technologies, manufacturers
will want to take advantage of credits to be gained by achieving FELs slightly
below the standard in order to offset credit needs by smaller engine families. A
larger percentage is not used due to the stringency of the standard in relation to
available technologies to meet emission levels much below the standard.
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Chapter 1: Introduction
Chapter 7 contains the aggregate cost analysis for this rulemaking and Appendix E
contains the corresponding spreadsheets. The cost estimates presented in Chapters 4 and 5 were
used to calculate these costs which include uniform annualized costs for variable and fixed costs
per class, average cost per engine per class and overall cost-effectiveness. The cost-
effectiveness with fuel savings is also presented.
Chapter 8 outlines the analysis of impacts on small entities for this final rulemaking. The
work for this analysis was completed through a work assignment with ICF, Incorporated in 1997
and additional work by EPA in 1999. Through this work, EPA analyzed the expected impact on
small production volume engine and equipment manufacturers based on the standards and
programmatic content of this final rulemaking7. Based on the stringency of the standards, phase-
in, ABT and a number of compliance flexibilities, it is anticipated that the impact on small-
volume manufacturers and small-volume models will be minimal.
Chapter 9 contains the background information and analysis on certification useful lives
and regulatory flexibility parameters. The standards in this final rulemaking would be met by
engines based on the emissions at the end of the certification useful life of the engine. Three
choices of certification useful lives for handheld (50, 125 and 300) are included in this
rulemaking. These options were based on useful life information by PPEMA and EPA's own
analysis. The options for Class I-A are the same as that for handheld engines. The options for
Class I-B are the same as nonhandheld engines which are 125, 250, 500 hours. The production
volume cutoffs for the various flexibilities for this rulemaking were based on the information
available in the 1996 PSR OELINK database and EPA's Phase 1 certification database as of
September 1998. Chapter 9 contains the rationale behind the decisions for each flexibility cutoff.
7 This includes certification and production line testing.
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Chapter 2: Test Cycle and Tests Procedures
Chapter 2: Exhaust Emission Test Cycle and Test Procedures
2.1 Introduction
For EPA to successfully regulate exhaust emissions from small nonroad engines, the
Agency strives to establish test procedures and cycles that ensure technologies used by
manufacturers not only meet the emission standards when tested over the required test
procedures, but also result in a predictable emission reduction in actual use. Test procedures are
specified to a level of detail necessary to produce accurate, repeatable results. The following
discussion is for those engine families using the handheld cycle (handheld engines and
Class I-A). Discussion on the test cycle for Class I-B (nonhandheld cycles) can be found in the
Phase 1 Final RIA (Ref 1).
2.2 Phase 1 test procedures and test cycle
The Phase 1 test procedure is described in 40 CFR Part 90, Subparts D and E. The
Phase 1 test procedure is based upon well established and accepted on-highway exhaust emission
methods and equipment, with some modification to take into account the unique nature of Small
SI engines. The procedures are designed to accurately measure engine emission performance. A
description of the Phase 1 test cycle and procedure can be found in the Final RIA for the Phase 1
rule.(Ref. 1) The Phase 1 test cycle is comprised of a series of steady state 'modes'. A mode is a
specified engine speed and load condition, during which the engine is stabilized and emissions
are sampled. The emission results for all of the modes are combined using 'weighting factors'
into a single number for each pollutant.
One distinct cycle (set of modes) is used for small handheld engines. The test cycle for
handheld applications consists of two modes, one full load condition at rated speed and one no-
load condition at idle speed.
The Agency determined during the Phase 1 rulemaking, based on the information
available at the time, that for the range of technologies expected to be used to meet the Phase 1
standards, that the Phase 1 test cycle and weighting factors were appropriate.
2.3 Agency review of the Handheld Engine Test Cycle
Prior to proposing Phase 2 emission standards for small nonroad engines, the Agency first
undertook, with the cooperation of the engine industry and members of the Negotiated
Rulemaking Committee, a test program to determine if the Phase 2 rule should contain a change
in the test cycle. The Agency has found for other mobile source categories that steady-state test
cycles often do not result in real in-use emission reductions and that 'transient' test cycles which
more closely mimic real world operating conditions are necessary. A transient cycle means a
combination of speed and/or load conditions which vary with time, such as the on-highway
Federal Test Procedure for light-duty vehicles or heavy-duty engines.
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Chapter 2: Test Cycle and Tests Procedures
During the Reg/Neg process the Agency expressed concerns regarding the ability of the
Phase 1 steady-state test cycles to adequately predict in-use emission reductions for a Phase 2
rule which would result in different engine technologies being employed. The Reg/Neg
committee established a Test Procedure Task Group to examine the existing Phase 1 test cycle
and procedure and make recommendations to the committee regarding any appropriate changes.
(Ref. 2)
The Test Procedure Task Group established by the Reg/Neg committee examined the
Phase 1 handheld test cycle and its viability as a Phase 2 test cycle. The work performed by the
Handheld Subgroup is well documented in their final report. (Ref. 3)
The Handheld Subgroup chose a Class IV chain saw as the test engine used to evaluate
the effect of transient operation on a future technology engine. The chain saw was picked
because chain saws have the highest amount of throttle activations from idle to wide open
throttle (WOT) (see Ref. 4 to this Chapter), e.g., chain saw use is considered to be the most
transient of handheld engine applications. The Class IV chainsaw was tested in a baseline
configuration and with a modified carburetor which included a leaner calibration and an
accelerator pump to simulate a 'future technology' engine. The Handheld Subgroup used in-field
engine operating data to determine the appropriate weighting between wide-open throttle (WOT,
e.g., maximum load) and idle conditions. For chain saws, use was 70 percent WOT, and 30
percent idle. The Handheld Subgroup chose as a representative set of transient test cycles for
chain saw operation three cycles. Of the three transient cycles, the Handheld Subgroup
determined the "20-second" cycle to be the most appropriate for chain saw applications. The
20-second cycle fluctuated between WOT and idle at a rate of 14 seconds WOT followed by 6
seconds of idle which was repeated for a total cycle time of 360 seconds, or 18 repetitions of the
WOT/idle change. The steady-state comparison cycle was a two mode test identical to the
Phase 1 handheld engine test cycle, but with weighting factors adjusted to match the specific
operating conditions of chain saws, 0.7 for the maximum power mode, and 0.3 for the idle mode.
Table 2-01 contains a summary of the relevant emission test results collected by the Handheld
Subgroup.
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Chapter 2: Test Cycle and Tests Procedures
Table 2-01
Summary of Results from Handheld Transient/Steady State Cycle Program
Test Engine
Class IV Chain Saw w/
Accelerator Pump
Class IV Chain Saw w/
Accelerator Pump
Class IV Chain Saw w/
No Accelerator Pump
Class IV Chain Saw w/
No Accelerator Pump
Cycle
Steady-State
20 -Second
Transient
Steady-State
20-Second
Transient
Avg. HC
(g/kW-hr)
113
113
111
120
Avg. NOx
(g/kW-hr)
2.35
1.96
2.20
2.20
Avg. CO
(g/kW-hr)
99
109
109
89
Table 2-01 indicates that, if manufacturers choose to adopt a technology similar to that of
a lean carburetor calibration, or with lean carburetor calibrations combined with an accelerator
pump8, a transient test cycle is not necessary to predict emission results at this level of control.
Anticipated technologies for meeting Phase 2 emission standards (50 g/kW-hr) include a mini-
four stroke engine (similar to nonhandheld engine designs which also concluded the steady state
test cycle was acceptable) or reduced scavenged engine (through internal redesigns) with a
catalyst. These technologies will likely not incorporate an accelerator pump as tested above and
therefore the test engine comparison may be considered worst case. Therefore, the Agency is
retaining use of the Phase 1 two-mode steady state test procedure for Phase 2 handheld engines.
In addition to examining the possible need for a transient test cycle for a Phase 2
program, the Test Procedure Task Group also examined the appropriateness of weighting factors
for the two-mode steady state cycle. The Phase 1 test procedure specifies a weighting factor of
0.90 for Mode 1 (maximum power mode) and 0.10 for Mode 2 (idle mode). The analysis and
recommendation of the industry group which studied the weighting factor issue is well
documented in their final report.(Ref. 4) A group of handheld engine manufacturers collected
field cycle data on several handheld applications: 12 trimmers/brush cutter, 4 chain saws, and 6
blowers. The industry group proposed a methodology to determine the appropriate handheld test
cycle weighting factors which determined the average WOT/idle time percentages for each
The emission results for this experimental test engine are above the Phase 2
Class IV HC+NOx standard of 50 g/kW-hr. This is due to the fact that this was
the best technology option at the time to evaluate emission results from
transient/steady state tests cycles.
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Chapter 2: Test Cycle and Tests Procedures
application (trimmers/brush cutters, chain saws, and blowers), and weighted these by the HC
emissions inventory impact from each application. The HC emissions inventory impact of each
application was determined by the following formula:
Emissions Inventory Impact = (TU x HU x LF x HP x EM) + TE
where,
TU = total units sold per year per application
HU = annual hours of use per application
LF = load factor per application
HP = average rated horsepower per application
EM = engine emission factor (g/hp-hr) per application
TE = total emissions per year for all applications.
The results of the analysis performed by members of the handheld engine industry
indicate that the appropriate weighting factors for handheld engines is 0.85 for Mode 1 and 0.15
for Mode 2. For the Phase 2 handheld engine final rule, the Agency is modifying the weighting
factors for Phase 2 engines to reflect the results of the analysis performed by industry. Though
these new weighting factors are only slightly different from the 0.90/0.10 values used for
Phase 1, the Agency believes the Phase 2 program is an appropriate time to make this minor
change. This is based on the fact that the EPA Phase 1 certification database shows that the
majority of handheld engine families in Phase 1 already meet the Phase 1 standards with some
cushion and therefore the calculation change to 0.85/0.15 would not cause a significant change in
the overall emission results, as related to the standard, and therefore additional technologies
would not be required to comply with Phase 1. The Phase 2 handheld engine standards are much
more stringent and the change to the 0.85/0.15 weightings would be more influential on standard
calculations.
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Chapter 2: Test Cycle and Tests Procedures
Chapter 2 References
1. "Regulatory Support Document, Control of Air Pollution, Emission Standards for
New Nonroad Spark-Ignition Engines at or Below 19 kiloWatts" US EPA, May 1995,
Docket A-93-25, Item V-B-03.
2. Handouts and Notes from all Meetings of the Test Procedure Task Group held
during the Phase 2 Regulatory Negotiation are available in EPA Air Docket A-93-92.
3. "Final Report - Handheld Subgroup of the Test Procedure Task Group", Docket
A-93-29, Item II-M-40.
4. "Hand Held Composite Duty Cycle", Dec. 30, 1994, Docket Item II-D-18.
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Chapter 3: Technologies and Standards
Chapter 3: Technologies and Standards
3.1 Introduction
Section 213(a)(3) of the Clean Air Act presents statutory criteria that EPA must evaluate
in determining standards for nonroad engines and vehicles. The standards must "achieve the
greatest degree of emission reduction achievable through the application of technology which the
Administrator determines will be available for the engines or vehicles to which such standards
apply, giving appropriate consideration to the cost of applying such technology within the period
of time available to manufacturers and to noise, energy, and safety factors associated with the
application of such technology." This chapter presents the technical analyses and information
that form the basis of EPA's belief that the finalized emission standards are technically
achievable accounting for all the above factors. Specific areas of discussion include a basic
description of the technologies examined, current status of the technology in the existing market,
new and in-use emission performance of each technology, costs of each technology, impact of the
engine technology on equipment design and use, and impact of the technology on noise, safety,
and energy. Finally, this chapter concludes with a discussion of the finalized standards
(handheld, Class I-A and Class I-B) and how these standards meet the statutory criteria.
3.2 Technologies
Section 3.2 contains descriptions of technologies for handheld engines which include
compression wave technology (with and without catalysts), stratified scavenged with lean
combustion (with and without catalysts), four-stroke, improved two-stroke with a catalyst, and a
spark-ignition technology. Class I-A engines use the same technologies as handheld engines.
Class I-B engines use technologies similar to nonhandheld engines and are discussed at the end
of this section. At the time of this final rule, handheld engine manufacturers have begun to
certify to the California ARB standards for 2000. The current certification database, as of the
time of this rulemaking, is contained in Appendix D.
3.2.1 Compression Wave Technology (With and Without Catalyst)
3.2.1.1 Description of Technology — The compression wave technology is a
technology that has been presented to EPA by John Deere and is referred to herein as the LE
Technology. As stated in information provided by John Deere (see Docket Item IV-G-30), "(t)he
LE technology relates to a compressed air assisted fuel injection system for internal combustion
engines, specifically two-stroke engines. Its primary characteristic is in its low emission
performance, namely through almost total elimination of an unburned fuel charge during the
scavenging process of the exhaust portion of the two-stroke cycle."
Docket Item IV-G-30 also states that the two-stroke engine containing the LE Technology
"retains a conventional piston, crankshaft and crankcase from a standard two-stroke engine."
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Chapter 3: Technologies and Standards
The fuel metering system needs to be designed to perform with the engine's needs, but does not
need to provide a high precision timing or spray quality. "The fuel injection system is a
compressed air assisted system. The injection system comprises an accumulator. The
accumulator...has an inlet connectable to pressure within the crankcase and has an exit at the
injection port. The accumulator functions as a collector and temporary storage area for
compressed air. In this configuration, the source of the compressed air is air scavenged from the
crankcase. The piston compresses the air in the crankcase on the piston's downward stroke....
the two apertures are both provided in the cylinder, one above the air inlet and one below the air
inlet. Both apertures are piston ported. In other words, the piston head is sized and shaped to
open and close access through the apertures as the piston head reciprocates up and down the
cylinder. The accumulator... is a simple channel between the two apertures. The channel could
be partially machined into an exterior surface of the cylinder with a cap then being attached to the
cylinder to form and enclose the channel with only the two apertures. Alternatively, the
accumulator could be provided in a separate member attached to the cylinder. An exit form the
fuel metering system is located in the channel proximate the injection port.... The injection
system has minimal moving parts.... the fuel injection system uses the piston head to open and
close its ports. Timing of the opening and closing of the ports will be dependent upon location of
the ports along the length of the cylinder."
A detailed description of the working of the technology can also be found in Docket Item
IV-G-30. The main thrust behind the technology is a compression wave, which is essentially an
acoustic wave, and thus the wave travels at the speed of sound. "As the reflected compression
wave exits the inlet (of the accumulator), it causes the fuel and air in the cylinder to be greatly
disturbed, in effect functioning as a shock wave. This helps to atomize the fuel and distribute the
fuel better in the air. In addition, the reflected compression wave assists in removing fuel
droplets that might be adhering to tips or edges of the inlet by surface adhesion or surface
tension. The compression wave shocks the fuel off of the surface and into the cylinder."
3.2.1.2 Current State of Technology Development — John Deere has been developing
the technology on a Class IV trimmer into the 2000 calendar year. The latest California ARB
certification list (see Appendix D) for the 2000 model year includes the 25cc engine by John
Deere with this technology. In regards to other classes and applications, John Deere completed
preliminary development of the technology (in the summer of 1999) to a 70cc (Class V) Stihl
chainsaw and the latest emission levels are included in their comments to the Phase 2 SNPRM
(Docket Item IV-D-48). In addition, John Deere has submitted more recent information on two
Class IV trimmer engines and one Class V chainsaw engine equipped with the compression wave
technology (Docket Item VI-E-09).
Class V engine manufacturers have raised a number of concerns about the technology
through comments to the docket (Docket Items VI-D-08, VI-D-18, VI-E-26). The basis for the
comments by manufacturers concern the applicability of early designs (as it was developed in
winter 1999) of the John Deere LE technology to Class V engines. Concerns by the industry
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Chapter 3: Technologies and Standards
focused on the feasibility of the technology and included lubrication at engine operation other
than idle, smooth transitions between all engine operating modes, details of the fuel system being
unavailable and sensitivity of the fuel system to atmospheric temperature and pressure. EPA
tested the John Deere engine in its development stage as of the summer of 1999. Advancements
in the technology had been made and some address the issues raised by the Class V
manufacturers. Advancements included lubrication of the engine through limited fuel-oil-air
mixture that is brought into the crankcase during regular operation of the engine (the wider the
throttle, the more fuel-oil-air mixture)9. With respect to smooth operation, the fuel system setup
had been updated from the winter 1999 prototype, however, EPA testing revealed that further
attention to the carburetor, including protection from heat, was required. The sensitivity of
emission levels to atmospheric temperature and pressure was tested on two occasions. First, on
March 1,1999, EPA observed operation of the engine prototype on the dynamometer in John
Deere's emission test cell and requested that the operator change the CO range from 1.5 to 3.5
percent CO. The HC analyzer showed a minimal change in HC emissions (ppm basis).10
Secondly, EPA tested the John Deere engine in its summer 1999 small engine test program and
gathered emissions with engine settings varying from mid-range to rich air-fuel ratios (Ref 7).
While the CO concentration was not measurable due to test equipment problems, the HC+NOx
emission levels changed from 51.9 g/kW-hr to 55.3 g/kW-hr The engine was also tested in its
lean and rich conditions when it was fit with a catalyst and, in this configuration, CO was
measured. The only difference seen in the emission results were the resultant CO emissions
which were approximately 40 g/kW-hr in the lean setting and approximately 90 g/kW-hr in its
rich setting. This testing revealed that the technology was relatively consistent over a range of
air-fuel ratios.
9 The amount of fuel-oil-air mixture that is brought into the engine crankcase can
be application specific and is easily adjustable. For example, in a trimmer
application, 15 percent of the fuel needed for engine operation can be brought in
this manner and 85 percent of the fuel can be put into the accumulator tube. A
chainsaw which runs for longer times at heavy load is able to monitor a higher
amount of fuel-oil-air with some emission penalty. However, professional
chainsaws have other internal designs that allow them to meet lower emissions
without this technology. Therefore this technology does not need to achieve the
same emission reduction (on a g/kW-hr basis) as it does with Class IV engines. Jf
more is needed, then a low conversion efficiency catalyst may also be used
assuming there is sufficient cooling available.
10 The overall g/kW-hr is likely less affected for the power increased as the engine
ran richer and the power decreased as the engine ran leaner. These changes
coincided with increases and decreases in measured engine-out emission levels,
respectively.
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Chapter 3: Technologies and Standards
John Deere has indicated that one of the major benefits to this technology is that many of
the existing engine designs can be utilized with few alterations. The items that will need to be
modified include the heat barrier between the engine and the carburetor (the accumulator is
mounted in the existing width), two holes in the engine cylinder for the accumulator, a "stuffer"
in one of the holes, and minor modifications to the existing carburetor. Additional cooling will
be needed by the engine and this can be achieved by adding more fins (which can be done by
decreasing the thickness of the existing fins) and widening the fins. Designs for these fins are
already available from existing commercial engine designs. Additional engine improvements
may be necessary given specific engine designs and applications.
With respect to engine power, John Deere states, in Docket Item IV-G-30, that the engine
power remains nearly the same as the Phase 1 engine without the technology. "The 25cc engine
is rated and certified at 0.75 bhp for trimmer applications and 0.85 bhp for blower applications.
Its power range is 0.60 bhp to 0.98 bhp for trimmers and 0.60 bhp to 1.18 bhp for blowers." The
engine could be classified as either a 50-hour residential engine or a 125-hour engine.11
3.2.1.3 Exhaust Emissions Performance ~ John Deere has submitted certification to
California ARB's 2000 standards on its 25cc engine at 125 hours. The certification value for
HC+NOx is 45.6 g/hp-hr (61.1 g/kW-hr) with a 1.105 deterioration factor. The certification
value for CO is 202 g/hp-hr with a 1.341 deterioration factor for CO. In its current form, the
engine will require a catalyst to comply with the finalized emission standards for Classes in
and IV. The catalyst efficiency can be estimated using the parameters of the in-use emission
level, deterioration factor and power rating in the California ARB certification database
(0.95hp/0.71kW), assuming a 20 percent compliance margin (therefore using a goal of
approximately 40 g/kW-hr as one to reach in prototype development), and a catalyst
deterioration of 30 percent. The new engine catalyst efficiency required on the engine is
calculated to be 55 percent or 30 g/kW-hr or 18 g/hr (g/kW-hr x power x 85 percent (weighting
of the test power for calculation of g/kW-hr)). However, it is possible further development of
the LE system might obviate the need for a catalyst in at least some Class IV applications.
Further, EPA believes the need for catalysts will decrease with increasing engine displacements.
This is supported through John Deere's preliminary prototype of the technology on a 70cc Stihl
chainsaw engine, (John Deere, however, has not redesigned their own engine in Class V). In
Docket Item IV-D-48, emission results for the 70cc engine12 were 50.0 g/kW-hr HC+NOx and
190.5 g/kW-hr CO. These levels fall below the standards being finalized for Class V engines.
11 John Deere produces the 25cc engine for use in string trimmers and blowers
under the Homelite brand.
12 Note that the engine design was not optimized for performance; however, it was
used to cut wood.
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Chapter 3: Technologies and Standards
3.2.1.4 Technology Cost - Cost of the technology is detailed in EPA Air Docket
Item IV-G-30. John Deere states that "(D)evelopment time for these changes is short, while
both capital and added part costs are low." The cost of the technology includes (1) alteration to
the cylinder block consisting of the addition of two holes at the carburetor position, (2) addition
of a "staffer" into one of the holes, (3) carburetor placer replacement which includes the tube and
attachment, and a (4) slightly modified carburetor.13 The variable costs estimated by John Deere
were $4.50 to $8.00 and included the incremental cost of the hardware (i.e., the accumulator,
modified fuel delivery system, modified cylinder and components) and the incremental cost of
labor (estimated to be $0.50 of the costs). John Deere states that fixed costs are estimated to
range from $75,000 to $300,000 for an engine model (these are amortized in the total cost) and a
manufacturer should approach the low end of fixed R&D costs for subsequent engines. The
licensing fee of the technology was proposed by John Deere ranging from $7.50 minimum to 5
percent of the cost of an engine over $300 in volumes of 10,000 (e.g., $20 for a model that costs
$400 and is produced in 10,000 units/yr).14 We have adjusted some of these cost estimates to
reflect development work completed to meet California requirements; these adjustments are
detailed in Chapter 4.
For Class JJI, a catalyst is estimated to be used with the John Deere technology, resulting
in an extra cost for adding a catalyst to the engine. As mentioned above, catalysts may not be
required for all Class IV engine applications using the LE technology. John Deere has estimated
that with averaging available, approximately 50% of their Class IV applications can be certified
without using a catalyst. We would expect manufacturers to attempt to not install catalysts on
applications where catalyst usage would present the more difficult design challenge, specifically
chainsaws or similar pieces of equipment. For the cost analysis performed for this rulemaking,
we have analyzed two scenarios. The first, a "high-cost" scenario, anticipates that 50% of John
Deere's Class IV equipment will not require catalysts but, conservatively, the rest of the
industry's equipment will require catalysts. The second, a "mid-cost" scenario, anticipates that
the rest of the industry, as well as John Deere, will also be able to certify half of their Class IV
engines without relying on a catalyst. This assumption is supported by the high degree of cost
competitiveness claimed by the industry especially within Class IV, suggesting that if one
manufacturer can save catalyst costs in at least some applications, others will similarly try to do
so to remain cost and price competitive. For Class in engines, the adverse surface-to-volume
ratio of the engines makes it more difficult to meet the 50 g/kW-hr HC+NOx standard without a
catalyst. Therefore, all Class in 2-stroke engines are assumed to require a catalyst even if using
John Deere's compression wave technology.
13 Additional work on developing the technology has revealed that there may need to
be some transport redesign and cooling improvements (fins, etc.).
14 However, John Deere has stated they are open to other less costly licensing offers.
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Chapter 3: Technologies and Standards
Therefore the overall variable costs for each engine class in this rulemaking is estimated
using (1) the catalyst costs (as presented in section 3.2.2.4.) based on the estimated split of
residential and commercial equipment (in Classes in and IV), (2) the range catalyst installation
rates (noted above), (3) the range of costs provided by John Deere (adjusted by EPA as discussed
in Chapter 4) including the full cost of licensing fees as initially proposed by John Deere, and (4)
the percentage of engine families in the high and low volume categories as determined (based on
a cutoff of 400,000 production for John Deere cost range) as determined from the EPA Phase 1
certification database. The total cost will vary due to the variation in the John Deere licensing
fee based upon equipment price and engine family production volumes.
The licensing fees are of concern to several in the industry who have stated the licensing
fees are above the profit margin for some consumer-marketed equipment. This is of special
concern to competitors with John Deere, who claim they will be disadvantaged because John
Deere will not have to pay the full royalty. Professional equipment manufacturers have
commented about concerns that the price will impose a high added cost on professional
equipment. While John Deere has indicated it expects a lower licensing fee, we do not have any
way of estimating how much lower and therefore have used the originally offered fee schedule;
this will result in an overestimation of costs if indeed the actual licensing fees are lower as
anticipated by John Deere. We also expect lower licencing fees if the cost of the fee causes the
cost of the John Deere technology to be higher than competing technology options.
The cost of the licensing fee with respect to the licensing fees of other engine
technologies, such as the Ryobi or Honda four-stroke, is unknown and therefore EPA has no
knowledge of the comparison of the costs being requested by John Deere. The cost analysis for
this rule assumes the John Deere technology costs, including licensing fees, for all engines
(including John Deere) unless we know a manufacturer plans to rely on an alternative technology
(e.g., Ryobi four-stroke) in which case the cost of that alternative technology is used. For the
cost analysis of the second catalyst use scenario noted earlier (i.e., where only 50 % of Class IV
engines using the John Deere technology employ catalysts), EPA has also assumed that John
Deere will not pay any licensing fee itself.
3.2.1.5 Impact on Equipment Design - In regards to impact on equipment design, in
Docket Item IV-G-30, John Deere states that "no modifications are required to the standard
piston, crankcase and crankshaft: only small adaptations are needed for the cylinder and fuel
metering system (carburetor) and the only additional component is an accumulator, which can be
in the form of a simple channel or tube. The LE Technology can thereby be readily applied to
existing engines without substantial change to the molds and tooling of existing engine
components or housings."
However, based on discussions of other engine designs with several Class V equipment
manufacturers, it is clear that the impact on equipment design depends on the manufacturer's
current product. Manufacturers that tightly house the engine, or make the shroud as an integral
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Chapter 3: Technologies and Standards
part of the engine may not have available room for the accumulator tube and therefore there may
be minimal changes to the plastic shrouding surrounding an engine. Additional cooling may also
be an issue. Any technology will likely run leaner and use less fuel/oil for cooling, so these
issues will likely need to be addressed regardless of which low emitting technology is utilized.
Installation of a catalyst may well require some redesign, in particular of the engine
shrouding to improve cooling flow past the catalyst and to provide extra shielding of the catalyst
for safety. More discussion of this is contained in section 3.2.4. of this document.
3.2.1.6 Technology Impact on Noise, Safety and Energy ~ In Docket Item IV-G-30,
John Deere stated that "No measurements have been made to determine the impact of the LE
Technology on the sound characteristics or performance of the two-stroke engine. Observation
of the LE engines, without quantification, suggests that there is no appreciable difference in
sound levels between the engines and standard engines." John Deere also states that "during the
testing of the prototypes, the fuel consumption of both the 25cc and 70.7cc LE engines was
measured. A reduction of approximately 30 percent as compared to conventional or standard
engines was demonstrated." Regarding safety, a particular concern is the higher exhaust
temperatures of an engine equipped with a catalyst. More discussion on this is contained in
section 3.2.4. of this document.
3.2.2 Stratified Scavenging with Lean Combustion (With and Without Catalyst)
3.2.2.1 Description of Stratified Scavenging with Lean Combustion— The December 1998
edition of Power Equipment Trade stated that the problem with emissions from a two-stroke is
that it "use(s) the incoming fuel charge to scavenge, or expel, exhaust gases from the previous
combustion event. Unfortunately, about 30 percent of the intake charge goes out the exhaust port
with the exhaust.... Reducing these scavenging losses is the key to meeting emissions
regulations."
Stratified scavenged engines means that the scavenging is done with something other than
the fuel/oil/air charge. The stratified scavenged engine design by Komatsu-Zenoah uses air as
the scavenging component. Potential downsides of this approach include lower power.
Advantages of this approach include lower fuel consumption and lower engine out emissions.
3.2.2.2 Current State of Technology Development — Komatsu Zenoah has certified
several engines to the California ARB standards for 2000 using stratified scavenging with lean
combustion. The December 1998 issue of Power Equipment Trade contains an in-depth
description of the Komatsu-Zenoah "Air Head" technology. The engine is an industrial engine15
15 The crankcase is forged in three pieces is supported by a pair of ball bearings.
The forged rod has caged needles on both ends. The top end is scalloped to
encourage lubrication of piston pin and bearing.
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Chapter 3: Technologies and Standards
which has undergone major changes to the crankcase, cylinder and carburetor. Description of the
engine technology is as follows (quotes are taken from the December 1998 Power Equipment
Trade article):
Reduced scavenging is used to keep the air/fuel mixture from short-circuiting out the
exhaust port. Komatsu Zenoah developed a simple way to stratify the incoming fuel charge with
a layer of fresh air. This "air head" creates a barrier between the fuel charge and the exhaust
port, and it leans out the air/fuel mixture in the combustion chamber.
1. The engine uses a unique two-barrel carburetor by Walbro (special Walbro rotary valve
carburetor - key part which resembles standard WY-type carburetors). One meters fuel
and air in the usual way and the other the stratification air. Outlet pipes on the back of
the insulator block connect to pre-formed tubes (on the cylinder). Tubes carry
stratification air to transfer ports.
2. "To prevent scavenging losses, the carburetor's upper barrel sends pure air directly to the
transfer ports. Each port sports an alloy cover plate equipped with a nipple for the air
hose, a reed valve, and a valve stop."
-Pure air volume is controlled by the carburetor. "At idle the upper barrel is completely
closed. To ensure proper idle stability and acceleration, the upper barrel doesn't open
until the throttle barrel is about 5 to 7 degrees off idle. At wide open throttle, both barrels
are wide open."
-"The transfer ports are a closed port design. The air/fuel charge enters the transfer
channel through rectangular ports in the cylinder mounting surface. The reed valve
assembly does not affect air/fuel transfer from crankcase to cylinder."
-"The reed valves open in (toward the cylinder). As the piston travels up, negative
crankcase pressure draws the reeds open via the transfer ports. A column of pure air fills
up the port (at this point the port's cylinder opening is sealed by the piston skirt)."
-"As the piston comes down, the air/fuel mix is compressed and squished into the air-
rich transfer ports. Just before bottom dead center, the exhaust and transfer ports open,
the air stratified fuel charge enters the cylinder, and exhaust gases are pushed out.
Compared to standard two-stroke engines, the transfer openings are quite small. They are
aimed back, away from the exhaust port, to assure that exhaust gas, not the transfer
charge, is first out the exhaust port."
-"Since the air/fuel mix is preceded by a cushion of pure air, very little fuel is lost out of
the exhaust port. RedMax engineers report that Air Head scavenging losses are 9
percent— a 38 percent reduction compared to conventional (Schnurle) scavenging. "
-"Not all of the air goes out the exhaust port. Much of it remains in the combustion
chamber where it leans out the air/fuel mixture. To ensure the mixture is rich enough to
support combustion, the carb is set richer than usual."
"The resulting air/fuel ratio is still very lean compared to conventional mixtures, and that tends to
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Chapter 3: Technologies and Standards
delay the ignition process and cause incomplete combustion." To counter this potential problem,
Red Max did the following (information in parentheses is from SAE 980761)
1. The spark plug was moved to a straight up, dead-center location to maximize combustion
dynamics.
2. Timing and spark energy have been altered (the ignition system is now a GDI with CPU
rather than a transistor)
3. Higher compression was achieved by reducing crankcase volume
4. The combustion chamber geometry was changed. The piston is slightly domed to mate
with hemispherical combustion chamber and is fitted with two compression rings.
Also, according to SAE 980761, a crankcase reed valve is used in place of a piston valve in the
intake.
The stratified scavenged with lean combustion engine is estimated to require the use of a
catalyst for Class in and IV engines in order to meet the Phase 2 standards. As is the case with
the compression wave technology, there is a potential for at least some Class IV stratified
scavenged engines to be certified without a catalyst for a manufacturer taking advantage of
averaging. However, we have no manufacturer estimates of the portion of the Class IV engines
using stratified scavenging that could be certified without a catalyst. Therefore, for this analysis,
we are assuming all stratified scavenged engines use catalysts. EPA does not estimate that Class
V engines employing stratified scavenging will require a catalyst due to the likelihood that
application of the technology to larger engines results in lower emissions (as seen in Komatsu
Zenoah engine certification data from the California ARB as presented in Appendix D) and the
fact that the standard for Class V engines is higher than that for Classes HI and IV.
3.2.2.3 Exhaust Emissions Performance — Komatsu Zenoah has certified their 25.4cc
and 33.6cc engines to the California ARB in-use standards. The 25.4cc engine is certified at 66
g/kW-hr for HC+NOx and 186 g/kW-hr CO at 300 hours and the 33.6cc engine is certified at
53 g/kW-hr HC+NOx and 75 g/kW-hr at 300 hours. The results show that emissions appear to
decrease as engine displacement increases and that these engines will require a catalyst in order
to comply with EPA Phase 2 standards unless further improvements to the engine are made.
With regards to testing the technology with a catalyst, EPA's emission test data on Komatsu's
25cc stratified scavenged engine with one medium and one medium/high efficiency catalyst
ranged from 39-28 g/kW-hr HC+NOx, respectively. Using the data associated with the catalyst
that yielded 28 g/kW-hr, and assuming a 30 percent deterioration of the catalyst and 10 percent
deterioration of the engine, the resultant emission level in-use is calculated to be 48 g/kW-hr.
While these results show compliance with the standards in this rulemaking, there are several
issues that need to be addressed for application of this technology in Class in and IV engines.
The first is lower emissions to allow for a compliance margin with production engines and to
decrease the needed catalyst conversion efficiency (a catalyst of 58 percent conversion efficiency
(39 g/kW-hr) is used in the above example). While lower engine out emissions may be
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Chapter 3: Technologies and Standards
achievable in Class IV engines with further refinement of the engine design and the fuel delivery
system, this is of special concern in Class in engines where the surface-to-volume ratio is the
least favorable and further enleanment (than 14:1 as was used in the 34cc engine) may be
prohibited due to engine stability concerns. Second is exhaust temperature compliance with the
U.S. Forest Service temperature requirements. It should be noted however, that while EPA's
testing of the prototype 25cc engine with a catalyst did reveal concerns of high exhaust
temperatures, observation of the current muffler/housing arrangement revealed that the design
was not optimized and there was room for improvement in its design when compared to
Tanaka's current production version of an enleaned two-stroke engine equipped with a catalyst.
In regards to its application to Class V engines, EPA expects that the trend for decreasing
emissions (on a g/kW-hr basis) in larger displacement engines will continue due to the favorable
surface-to-volume ratios in larger engines. This is illustrated in the comparison of the new
engine HC+NOx emissions of the two engines mentioned in the previous paragraph, in which the
25cc engine yielded 64-73 g/kW-hr in EPA testing (Ref 7) and the 34cc engine was
47.3 g/kW-hr HC+NOx (SAE 980761). This is beneficial for application of this technology to
Class V engines for the lower engine out emissions and the higher HC+NOx standard for Class V
will likely require less of an engine enleanment and not require the use of catalysts, thereby
removing any concerns for sufficient lubrication in high speed applications, such as chainsaws,
and adding no cooling requirements for a catalyst.
The December 1998 article by Power Equipment Trade states that "Despite its closed
ports and higher compression, the Air Head's extra-lean combustion makes it less potent than
conventionally scavenged engines." Komatsu Zenoah states that the technology as currently
developed results in a decrease in power of 7 percent.
3.2.2.4 Cost of Stratified Scavenging with Lean Combustion (With and Without Catalyst) —
The December 1998 article by Power Equipment Trade states that "Red Max sets the price
impact at about 3 percent." Discussion with a Red Max dealer in the Ann Arbor, MI area in
January 2000 resulted in popular Class IV trimmer prices of $320 to $410 at the retail level.
Using an average cost of $365, a three percent price impact results in an estimated increase of
$10.95 at the retail level. Backing out retail markup (estimated to be 29 percent for this analysis)
results in a manufacturer cost impact of $8.50. EPA expects engine families in Classes HI and IV
to require the use of a catalyst. The cost for a catalyst are estimated in Section 3.2.4.4. of this
chapter. Equipment in Class V is typically more costly than those in Class IV and therefore,
assuming the 3-percent cost impact applies, the cost will be slightly more than the $8.50 cost for
Class IV noted above. EPA projects that catalysts will not be required for Class V engines.
Estimated costs for the stratified scavenged technology and improved two-stroke are
included in the 1996 Cost Study for Phase 2 Small Engine Emission Regulations (Ref. 1.).
However, a large number of components utilized in the Komatsu Zenoah design, particularly for
lean combustion, are not included in the ICF cost estimate (the Komatsu Zenoah model was not
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Chapter 3: Technologies and Standards
available at the time of the cost study) and therefore the ICF costs are not used as the basis of this
analysis.
3.2.2.5 Impact on Equipment Design — Given the slight power loss, the engine size
may need to be increased, depending on the manufacturer's equipment designs and power
requirements. Space will also have to be made for the larger dual barrel carburetor. The Air-
Head's extra-lean combustion likely requires additional engine cooling than is provided by
current two-stroke engine designs. This can be achieved through additional engine fins and
optimally designed thinner and wider engine fins. All of these factors could result in the need for
a redesigned engine shroud. These costs are reflected in the cost estimates of Chapter 4.
3.2.2.6 Technology Impact on Noise, Safety, and Energy — There are no known impacts
of this technology on the factors of noise or safety. EPA projects a 30-percent reduction in fuel
consumption based on the discussion contained in Section 3.2.3.1. Issues related to the use of
catalysts are contained in section 3.2.4. on catalysts. While some manufacturers commented that
the potential need to increase engine displacement would add size and weight which could
compromise safety, we note that existing equipment covers a wide range of sizes and weights
which have been accommodate without compromising safe operation; we anticipate that the
same would occur for handheld equipment using stratified scavenging. We currently are
unaware of any equipment using this technology which has compromised safety due to the
weight of size of the engine compared to equipment using conventional 2-stroke engines.
3.2.3 Conversion of Handheld Two-stroke Designs to Four-stroke Designs
3.2.3.1 Description of Two-stroke and Four-stroke Technology — Spark-ignited two-
stroke technology has seen widespread use in the small engine market, particularly in handheld
equipment applications (approximately 16cc-141cc). Four stroke engines have typically been
limited to ground supported applications, such as lawnmowers and garden tractors
(approximately 84cc-1395cc). The basic operating principle of the charge scavenged two-stroke
engine (traditional two-stroke) is well understood; in two strokes the engine performs the
operations of intake, compression, expansion and exhaust, which the four-stroke engine requires
four strokes to accomplish. Two-stroke engines have several advantages over traditional four-
stroke engines for use in handheld equipment: high power-to-weight ratios; multi-positional
operation; and lower manufacturing costs. Additional information on the basic operation of two-
stroke and four-stroke engines is widely available in the literature, including the references listed
at the end of this chapter.(Ref 1), (Ref 2), (Ref 3)
3.2.3.2 Current State of Four-stroke Handheld Engine Technology Development — In
recent years, the four stroke designs have drawn the interest of some handheld manufacturers due
to the four-stroke's lower HC exhaust emissions and better fuel economy than two-stroke
designs. At least three handheld engine/equipment manufacturers, Ryobi, Honda and Robin
America, have designed and are manufacturing, or plan to manufacture, Class IV (20cc-50cc)
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Chapter 3: Technologies and Standards
overhead valve four-stroke powered equipment in the U.S. The major equipment using Class IV
four-stroke engines are trimmers/edgers/cutters, pumps, generator sets and tillers16. In 1998,
EPA observed the operation of a four-stroke engine in a chainsaw and believes that this will
come to the marketplace for consumer use equipment in the near future.
The manufacturers of mini four stroke engines have made improvements over the initial
"scaling down" of the four stroke engine, by Ryobi in 1994, and have gained ground in the
power-to-weight ratio, multi-positional use and manufacturing cost benefits of two-stroke
engines. However, the four stroke technology has not yet been demonstrated as able to cover the
smallest (<20cc) or the highest range of two-stroke engine sizes (100cc+). Particular challenges
include improving and continued downsizing of the technology to improve power-to-weight
ratios and improvements in acceleration performance. We are optimistic that miniaturization of
four-stroke technology can proceed directly from the most recent work done to miniaturize the
Class IV engine. Particularly interesting are the newer mini four-stroke engines which are lighter
in weight than the initial Ryobi engine design and can handle high speeds as has been shown to
EPA in a Class IV four-stroke chainsaw application. The concern of acceleration in the larger
engines may be addressed in the future by engine manufacturers.
3.2.3.3 Exhaust Emission Performance of Four-stroke Technology — Prior to the
introduction of the Ryobi four-stroke handheld engine in 1994, no handheld four-stroke engines
existed, therefore, no exhaust emission data on uncontrolled engines is available. Federal 1998
Phase 1 certification data (new engine emissions) for the Ryobi 26.2cc four-stroke engine shows
the new engine HC+NOx emission rate is 37.6 g/kW-hr. The most recent California ARB
certification list for their in-use emission standards reveals that Ryobi has certified three 26.2cc
engines as low as 11.1 g/hp-hr HC+NOx (14.8 g/kW-hr) at 50 hours and 15.8 g/hp-hr HC+NOx
(21 g/kW-hr) at 300 hours, both of which are well below EPA's Phase 2 standards. Honda has
certified three four-stroke engines (22cc, 3 Ice and 49cc) at 31, 34.1 and 15.7 g/kWh respectively
to EPA's Phase 1 standards for HC+NOx. The California ARB certification list shows that the
31. Ice engine in-use emission result is 30.5 g/hp-hr (40.9 g/kW-hr) and the 49.4cc engine in-use
emission result is 19.0 g/hp-hr (25.4 g/kW-hr), which are both below EPA's Phase 2 standard.
Both of these engine families were certified to 300 hours. No information is yet available for the
22cc Honda engine. Lastly, Fuji Robin has certified a 24.5cc four-stroke engine to California
ARB standards and it is certified at 12.7 g/hp-hr (17 g/kW-hr). The range of equipment indicated
by the engine manufacturers includes brushcutters, trimmers, generators, pumps and tillers.
The HC+NOx deterioration rates for the four-stroke engine designs listed in the
California ARB certification database are listed for some manufacturers. Fuji Robin lists the
HC+NOx deterioration rate at 1.089 (at 125 hours). Honda lists the deterioration rate at 1.427
16 As indicated by the manufacturers in the Phase 1 certification database as of
September 1998.
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for the 49.4cc engine and 1.64 for the 31. Ice engine (both certified at 300 hours). Using the EPA
Phase 1 new engine certification information and the ARB in-use certification information, the
deterioration rate for the Ryobi 26.2cc engine is calculate to be 1.24 (at 50 hours). The
deterioration factors of the mini four-stroke engines fall within the expected deterioration rates
based on larger OHV engines in Class I and n (1.4 for OHV in Classes I and n) which are
certified at 125 hours. The increased mechanical friction in the smaller engines and the less
favorable surface-to-volume ratio in the combustion chamber contribute to the larger
deterioration factors of smaller four-stroke engine designs.
3.2.3.4 Costs of Four-stroke Handheld Engine Technology — The costs of converting
handheld two-stroke to four-stroke technology was estimated by ICF in their 1996 report (see
reference 1 to this Chapter). ICF included as part of their cost analysis a tear down and
comparison of a Ryobi two-stroke engine and the Ryobi four-stroke handheld engine. ICF
estimated costs for two annual production sizes, 90,000 and 400,000 units per year, which they
estimated as typical for the handheld industry. Ryobi provided its own cost estimates in
response to the SNPRM (Docket Item IV-D-47). Table 3-01 summarizes the cost information
developed by ICF and compares it with the very similar estimates from Ryobi. Echo, another
small SI engine manufacturer, also provided an estimate of the cost of converting to four-stroke
technology of $10.00 in discussions with EPA. (Docket Item IV-E-79).
Table 3-01
Summary of per Engine Cost for Conversion of Handheld Two-stroke
Technology to Four-stroke Technology (data from ICF, 1996 and Ryobi)
Cost Item
Additional Parts Estimate
Additional Labor + Overhead
Fixed Costs
Total
Ryobi Estimate
Engine Family Annual
Production = 90,000
$8.88
$1.05
$4.09
$14.02
$15.00
(less than 1 million)
Engine Family Annual
Production = 400,000
$8.88
$1.05
$1.73
$11.66
$10.00
(1 million or more)
It should be noted that, while ICF utilized 90,000 and 400,000 as representative engine
family productions in their 1996 study, production estimates contained in EPA's 1998 Phase 1
certification database shows that 88 percent of the 183 engine families (Classes HI through V)
have productions under 67,000 (mean=5,200), only 8 percent have productions near 90,000 and
only 4 percent of the engine families have productions above 190,000. As stated in the report by
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ICF (ICF, 1996), ICF "anticipate(s) that the small engine manufacturer may make certain
decisions to reduce the costs of this conversion, such as purchasing the four-stroke engines from
a larger handheld engine manufacturer. On balance between savings both capital and engineering
labor and the need to purchase the engines, the small manufacturers may realize a modest savings
over manufacturing the engines themselves." EPA is extending this assumption to small-volume
engine families produced by larger manufacturers. EPA therefore expects most engine
manufacturers with smaller engine families to choose another technology due to the cost-
effectiveness of this option17.
3.2.3.5 Impact on Equipment Design from Use of Four-stroke Handheld Engine Technology
— The conversion of two-stroke to four-stroke technology may likely have some impact on the
design of handheld equipment. Impacts of the new four-stroke designs include the redesign of
the shroud design around the engine, replacement of the fuel/oil tanks and air cleaner as well as
potentially lower power-to-weight ratios in some engine sizes.
The lower power-to-weight ratios would likely not be noticeable to consumers using
applications such as lower power residential string trimmers, brush cutters, edgers, blowers,
portable generators, and portable pumps. The Agency has heard from handheld engine
manufacturers that for engines in the fractional to approximately 1.5kW range, residential users
typically do not use the full power rating of the engines to perform the intended work. Therefore,
the Agency believes four-stroke designs could be competitive from a performance perspective
with two-stroke designs in this power range.
However, in larger displacement, higher power engines, the potential power-to-weight
disadvantage of the four-stroke engine could become noticeable, and, if so, could impact the user
through fatigue from the added weight of the engine, thus potentially limiting the functionality of
the equipment. The high powered commercial chainsaws in the Class V category (displacement
>50cc) are typically designed for maximum power per cubic centimeter of displacement. In
these categories, the four-stroke engine could present a performance problem for users. Two
handheld manufacturers have specifically commented that acceleration of the four-stroke engine
is a concern in larger engines; both of these companies have either produced or examined the
possibility of producing four-stroke engine use.
One benefit of the traditional four stroke engine design is that the consumers would no
longer need to pre-mix fuel with two-stroke oil. However, consumers would need to maintain
crankcase oil levels at an acceptable level, and perform periodic oil changes. The cost impact of
4-stroke oil use (and maintenance) compared to 2-stroke engines we anticipate will be available
17 Manufacturers might choose to manufacturer four-stroke engines if their engine
families have many similar components and total a significant number of sales to
make four stroke production cost-effective.
23
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Chapter 3: Technologies and Standards
is negligible.
3.2.3.6 Impact on Noise, Safety, and Energy of Two-stroke to Four-stroke
Conversion — The Agency expects the conversion of two-stroke to four-stroke designs would
lower the noise levels from handheld equipment. Two-stroke designs are well known for their
relatively high noise levels as compared to four-stroke engines. A large source of noise from
two-stroke designs comes from pressure pulses generated by the exhaust gas at the exhaust port.
These pressure pulses tend to be higher in a two-stroke design compared to four-stroke engines
because the two-stroke engine requires the higher cylinder pressure to begin the blow-down
process (see Chapter 2 "Engine Fundamentals", Patterson, 1972, Ref 15 to this Chapter).
The Agency would expect no adverse change in the safety of handheld equipment from
the conversion of two-stroke to four-stroke designs. As discussed previously, the overall design
and use of handheld equipment would not change from the conversion to four-stroke engines, so
no change is expected with regards to safety. In addition, the Ryobi 4-stoke handheld equipment
has been available for several years, and the Agency is not aware of any safety problems which
have occurred from this equipment which can be attributed to the engine type. One area of
potential concern is with the increased weight of this four-stroke engine design and extended user
use of the product. However, recent four-stroke engine designs, for the Class IV trimmer market
in which they have been used, have been advertised at weights comparable to their two-stroke
counterparts. No catalysts are needed on 4-stroke engines to comply with the Phase 2 standards,
so catalyst shielding and elevated exhaust temperatures are not a concern.
However, most, if not all, handheld four-stroke engines have not been extended into Class
V in the marketplace. The power-to-weight ratio and acceleration of a four-stroke engine in
Class V has been raised as a concern by engine manufacturers that manufacture four-stroke
engines. This area raises the only potential safety concerns that may need to be considered in the
application of this technology.
The Agency would expect significant improvements in the fuel economy from the
conversion of two-stroke to four-stroke designs. The loss of fuel from the scavenging process for
two-stroke engines results in poor fuel economy which the four-stroke design does not
experience. Compared to a typical Phase 1 technology two-stroke engine, the four-stroke engine
is expected to achieve about a 30 percent improvement in fuel economy based on information
supplied by Ryobi).
3.2.4 Application of Catalytic Converters to Handheld Engines
3.2.4.1 Description of Catalyst Technology — Catalytic converters are add-on devices
used to lower exhaust emissions from engines after they exit the combustion chamber. Typically,
a catalyst consists of a ceramic or metallic support (often called the substrate), that is coated with
a wash-coat which contains catalytic material (typically a rare-earth element such as platinum,
24
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Chapter 3: Technologies and Standards
rhodium and/or palladium). The catalytic material initiates a chemical reaction which can,
depending on the catalyst material chosen, oxidize hydrocarbons and carbon monoxide, and/or
reduce oxides of nitrogen.
Additional information regarding the fundamentals of catalytic converters, and
information specific to catalyst and small engines can be found in "Report - Exhaust Systems
Subgroup of the Technology Task Group", a report published by a task group established during
the Regulatory Negotiation for Small Engine Phase 2 Rulemaking.(Ref. 4)
3.2.4.2 Current State of Catalyst Technology Development — Historical data indicate
that catalysts have seen limited use on small engines in the U.S. Prior to EPA or California ARB
small engine regulations, catalysts were used in limited numbers, on some types of indoor
equipment such as indoor propane fueled floor buffers (also called floor burnishers), but no
handheld applications utilized catalyst technology18.
Today, Husqvarna has certified several engine families using two-stroke technology with
a low-efficiency catalyst19. These Husqvarna families have been developed for string
trimmer/brush cutter applications and are currently being sold in the U.S. and Europe. The
catalyst technology on these engines is of a unique flat plate design rather than the honeycomb
design used in automobiles. The catalyst was added to the engine only after emission reduction
improvements were made to the engine. Emissions had to be reduced from the engine such that
the catalyst conversion efficiency could be sufficient to reduce emissions notably and also remain
below the temperature limit requirements set by the U.S. Forest Service, as will be discussed
later in this section. The engine went under a number of design changes as is described in
MECA's NPRM comments to the docket(Ref. 5) "First, Husqvarna reduced the crankcase
volume which increased crankcase pressure. The increased crankcase pressure, combined with
the higher back pressure in the muffler, made it possible to optimize the intake cycle and fuel
retention. Second, the carburetor was equipped with adjustment caps to prevent it from being set
too rich. Third, the remaining unburned fuel and other gas components were converted by a
lightweight catalytic converter (10 grams). The standard metal baffle in the muffler was replaced
with a special metal plate treated with a catalytic coating. The converter has low mass which
18 Chainsaws with catalytic converters have been sold in Europe; however, these
models have not been sold in the U.S. and, according to their manufacturer,
currently do not meet the U.S. Forest Service temperature limits.
19 As MEC A's comments to the NPRM in March 1998 indicates, "For handheld
engines, the types of engine design changes needed to allow a catalyst to achieve
30 to 50 percent efficiency at the end of the engine's useful life are well illustrated
by the design changes made by Husqvarna." The exact conversion efficiency of
the Husqvarna catalysts are not readily known.
25
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Chapter 3: Technologies and Standards
ensures lower heat retention than earlier versions. Finally, the muffler contour was redesigned
such that cooling air flow was optimized to minimize surface temperatures." However, based on
the certification levels of Husqvarna's currently certified engines equipped with catalysts as
presented in Table 3-03 (which range from 155 g/kW-hr to 184 g/kW-hr HC+NOx on a new
engine), it can be seen that more internal improvements are needed to meet EPA's finalized
Phase 2 standards. A letter from MECA to EPA on October 19, 1998 states that there are an
estimated 300,000 Husqvarna catalyst-equipped two-stroke engines in equipment for sale in the
US and Europe.
3.2.4.3 Exhaust Emission Performance of Catalysts — Several sources of information
exist on this topic. They include the report entitled "Report - Exhaust Systems Subgroup of the
Technology Task Group" (Ref 10), data from catalysts used on Husqvarna engines that are sold
in the marketplace(Ref 6), EPA test data on Phase 2 engine technologies (Ref. 7) and the most
recent California ARE certification data (Ref. 8).
The Exhaust Systems Subgroup of the Technology Task Group Report contains a
summary of new engine data on the HC and NOx reduction potential from the application of
traditional honeycomb catalysts to two-stroke and four-stroke small engines, see Table 3-02. The
majority of these engines were uncontrolled or Phase 1 technology gasoline engines with a
prototype catalyst added on.
Table 3-02
Observations of Emission Changes with Catalysts
(Exhaust Systems Subgroup of the Technology Task Group Report)
Engine Design
Four-stroke
Two-stroke
HC
40-80% dec
20-80% dec
Class IV Engine
Emission Range for
HC (g/kW-hr)*
range: 15.7-37.6
avg: 29.6
range: 96.7-235
avg: 181
NOx
20-80% dec
25-50% inc
10-20% dec
up to 40%
inc
Class IV Engine
Emission Range for
NOx (g/kW-hr)*
range: 0.7-2.7
avg: 1.7
range: 0.3-3.1
avg: 0.94
* - Emission data is from EPA's Phase 1 certification database as of September 1998 and not
the Exhaust Systems Subgroup Report
Husqvarna is the first manufacturer to show the feasibility of catalyst use on handheld
26
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Chapter 3: Technologies and Standards
equipment in the US marketplace20. Husqvarna has certified several engine families under
EPA's Phase 1 program which utilize a low efficiency flat plate catalyst on two-stroke engines.
The engine has incorporated at least one internal engine improvement in addition to use of a
catalyst. The information in Table 3-03 is from the EPA Phase 1 certification database and is
from the rich setting of the carburetor.
Table 3-03
New Husqvarna Phase 1 Certification Engines
With Catalysts Class IV Trimmer/Edgers (g/kW-hr)
Engine Family
XHVXS.0254EB
XHVXS 0274 EA
XHVXS.0314EA
XHVXS.0364EA
Power
0.86kW
0.9kW
1.07kW
1.31kW
Displacement
24.5cc
25.4cc
30.8cc
36.3cc
HC
181.9
183.9
157.0
154.5
CO
622.3
663.1
551.2
595.8
NOx
0.3
0.2
0.2
0.3
During the summer of 1999, EPA tested the John Deere LE engine and the Komatsu
Zenoah stratified scavenged with lean combustion engine with and without catalysts (Ref 7).
John Deere provided one catalyst for testing and three catalysts provided by a major catalyst
manufacturer were tested on the Komatsu Zenoah engine. Optimization of the catalyst
conversion efficiency and heat management were not of concern in this testing. The emission
results are summarized below. Note that additional repeat tests were not included.
20
Several catalyst-equipped chainsaws are sold in the European marketplace, since
Europe has no temperature restrictions due to use of the professional equipment in
winter weather and conditions that are not representative of those in the U.S.
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Chapter 3: Technologies and Standards
Table 3-04
EPA Emission Testing of John Deere's Compression Wave
With and Without a Catalyst (g/kW-hr)
Tests 99-8695 to 99-8700 (Ref. 7)
Tests
Baseline engine (w/o Catalyst) results
(average of 2 tests)
With Catalyst - Engine on Lean Setting
(average of 2 tests)
With Catalyst - Engine on Rich Setting
(1 test)
% Decrease with Catalyst (lean/rich)
HC
50.5
20.6
19.5
59.2/61.4
NOx
1.26
1.75
1.07
-39/15.1
CO
124
40
95
67.7/23.4
Table 3-05
EPA Emission Testing of Komatsu Zenoah's Stratified Scavenged with
Lean Combustion With and Without Catalysts (g/kW-hr)
Tests 99-8673 to 99-8680 (Ref. 7)
Tests
Baseline engine (w/o Catalyst) results
(average of 2 tests)
With Catalyst SU00895
(average of 3 tests)
% Decrease with Catalyst SU00895
Baseline engine (w/o catalyst) results
With Catalyst SU00908
(average of 3 tests)
With Catalyst SU009 10
(average of 3 tests)
% Decrease with Catalyst SU00908
% Decrease with Catalyst SU00910
HC
71.2
39.07
45.1%
68.3
38.5
27.9
43.6%
59.2%
NOx
1.29
0.947
26.6%
1.28
0.62
0.61
51.4%
52.2%
CO
221
116.3
47.4%
201
113
95
43.8%
52.7%
The California ARB certification data as of January 12, 2000 contained information on
several engines with catalysts. In addition, it contained information on a Stihl 27.2cc engine
which was certified with and without a catalyst, both at 50 hours. The HC+NOx emissions from
28
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Chapter 3: Technologies and Standards
the engine without a catalyst were 102 g/hp-hr (137 g/kW-hr). The HC+NOx emissions from the
engine with a catalyst were 42.5 g/hp-hr (57 g/kW-hr). Based on these results, the catalyst
efficiency with respect to HC+NOx emissions is calculated to be 58 percent. The deterioration
factor for the engines indicated in the California ARB certification is 1.0, both with and without
the catalyst. Other certification engines with catalysts have indicated HC+NOx deterioration
factors ranging from 1.0 to 1.281 at certification useful lives up to 300 hours.
Additional catalyst deterioration is available from MECA's letter of October 19, 1998.
The data shows results of one two-stroke Husqvarna trimmer with a catalytic converter plate with
an acoustic muffler after 300 hours. Results are an HC deterioration factor of 1.4021 (Ref. 6). As
noted in the previous paragraph, engine manufacturers have not claimed such high deterioration.
Deterioration of catalyst efficiency is caused from several mechanisms, including the physical
deterioration of the substrate from mechanical shock, vibration, and extreme temperatures, and
the deactivation of the catalyst material from chemical poisoning (such as sulfur). Catalysts on
Phase 2 technology engines, such as four-stroke, stratified scavenged with lean combustion or
compression wave technologies, are anticipated to experience less deterioration due to the fact
that there is significantly less unburned fuel and oil flowing through the exhaust pipe, and
therefore through the catalyst. Lower engine out emissions should result in less catalyst
deterioration as well.
The limiting factor for achieving the maximum conversion efficiency will be the ability
of the engine manufacturer to manage the heat generated by the catalyst such that the certain
measurement points relating to the application meet the temperature limits set by the U.S. Forest
Service22. Testing of the redesigned Tanaka 39.8cc two-stroke engine with a catalyst (used in a
trimmer) by EPA in the summer of 1999 (Ref. 7), showed that the catalyst (and presence of such)
resulted in a conversion of 67 g/hr HC. Based on the California ARB certification data of
45.11 g/hp-hr (60.5 g/kW-hr) for this 1.6 hp (2.14 kW) engine, comparison of 67 g/hr reveals this
is a medium-high conversion catalyst. Temperature measurements on the equipment (Ref. 7)
reveal that it is slightly below the exhaust gas plane temperature requirement of the U.S. Forest
Service. It is also likely below the exposed surface plane temperature specified by U.S. Forest
Service. Only the muffler skin surface temperature was obtained, but EPA believes this will
21 Engine manufacturers who have worked with catalysts have indicated that
catalysts are more emission durable in-use than indicated here.
22 As of May 1999 it is known that industry has visited the U.S. Forest Service to
discuss with them the applicability of the temperature limits to an engine with a
catalyst (it is understood that the limits were set on an engine without a catalyst).
The manufacturers are planning to conduct testing to verify if there are any
specific concerns of temperatures on engines with catalysts that are not currently
covered by the U.S. Forest Service requirements.
29
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Chapter 3: Technologies and Standards
meet the temperature requirements because of the large distance between the muffler skin and the
exposed surface plane. For application of this engine in a trimmer, Tanaka has designed the
equipment shroud a significant distance away from the muffler and has also placed the muffler
outlet at the top of the muffler which is also some distance away from the shroud outlet. The
shroud is also designed to allow maximum cooling from the environment due to the large mesh
like design of the shroud around the muffler. Techniques such as pulling cooling air into a
passage at the exit of the muffler and adding additional shrouding around the muffler are
additional ways to allow the use of higher efficiency catalysts.
However, the amount of heat that must be dealt with in handheld applications is
dependent on size, application, ability to reduce the engine out emissions and ability of the
engine to handle additional heat. Relating to size, if the exhaust pollutants, in g/kW-hr, were the
same on varying size engines (20 to 90cc for example), the larger size engines (higher kW)
would generate a higher amount of heat due to the amount of exhaust flow from the engine which
must be converted by the catalyst. Therefore, in order to reduce the heat from the catalyst, the
catalyst's percentage conversion efficiency must be reduced or the amount of unburned HC and
CO coming out from the engine needs to be reduced. The ability to reduce engine out emissions
is the major factor in the percentage efficiency catalyst that can be used on an engine. Favorably,
the larger the engine, the easier it is to lower the emission rate per amount of work (i.e., g/kW-hr)
tending to offset at least part of the exhaust mass flow rate (i.e, g/hr) with larger engines. An
engine that is of four-stroke design or incorporates some form of stratified scavenging with lean
combustion and related internal engine improvements, will also have lower engine out emissions
than Phase 1 engine designs. The catalysts can then achieve higher efficiency conversion for
they are converting a reasonable amount of pollutants in the exhaust stream, and thereby the heat
produced is manageable.
Lastly, relating to the ability of the engine to handle additional heat, Phase 2 engines will
have significantly less fuel cooling (due to enleanment or changes in fuel/oil flow inside the
engine) than current Phase 1 designs and therefore will depend more on air cooling. To the
extent that the forced air cooling (e.g., via a fan design) passes over the engine fins for engine
cooling, less cooling capacity may be available for the muffler as well. In addition, the engine
with a catalyst will be exposed to some heat from the catalyst. Thus, cooling redesign will need
to consider extra cooling due to higher engine combustion temperatures, potential for heat
transfer to the engine from a close-coupled catalyst and finally the cooling of the exhaust system.
To EPA's knowledge, manufacturers of low emitting two-stroke engine designs with enleanment,
such as compression wave technology by John Deere or stratified scavenged with lean
combustion by Komatsu Zenoah, have not fully addressed issues relating to application of
catalysts to these designs which are currently being certified with the California ARE without
catalysts. It has been indicated by one manufacturer that engine redesign will be necessary to
minimize and accommodate the heat that is created by the use of a catalyst. For those engines
being certified to California ARB standards with a catalyst, some potential additional cooling
design might be necessary if engines run leaner to meet EPA's Phase 2 standards. This
30
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Chapter 3: Technologies and Standards
phenomenon will have to be examined on a per engine family basis. Relating to application,
blowers have much more cooling air available to them than other applications and therefore can
handle a higher temperature catalyst.
For the standards being finalized, EPA assumes that a medium to a medium-high
efficiency catalyst will be used on the majority of engines in Classes HI and for a portion of the
engines in Class IV, since the standards presently cannot be met solely with the technologies of
compression wave or stratified scavenged with lean combustion technologies. Engines with the
four-stroke engine technology need not employ a catalyst. Engines in Class V will be able to
meet the finalized standards using the engine technologies noted previously, and therefore not
employ a catalyst.
3.2.4.4 Costs of Catalysts — Costs are available from three sources and include (1)
the ICF 1996 report (see reference 1 to this Chapter - the costs of applying a catalyst to a two-
stroke engine were estimated), (2) MECA's comments submitted in the response to the January
NPRM, and (3) Echo's comments to the SNPRM (Docket Item IV-D-37).
The 1996 ICF report presented costs on application of a catalyst only to four-stroke
engines. The Agency estimates the costs of applying a catalyst to a four-stroke engine would be
similar, particularly for the engineering research and development work. ICF's analysis
considered the costs for both a metallic honeycomb substrate and for a ceramic honeycomb
substrate, with the estimated cost of a metallic substrate being higher. (The catalyst used on the
Husqvarna E-TECH engines discussed earlier, is a metal plate catalyst, which is simpler and less
expensive than a metallic honeycomb catalyst.) Table 3-06 is a summary of the cost information
contained in the 1996 ICF report for application of catalysts to two-stroke engines.
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Chapter 3: Technologies and Standards
Table 3-06
Summary of per Engine Cost for Application of a Catalyst
to a Handheld Two-stroke Engine (data from ICF, 1996)
Cost Item
Catalyst
Catalyst
Assembly
Labor
Catalyst Fixed
Cost
Muffler/ Heat
Shield
Hardware Cost
Muffler/ Heat
Shield Fixed
Costs
Total
Engine Family
Annual Production
= 90,000, ceramic
honeycomb
substrate
$4.00
$0.58
$1.20
$0.90
$0.98
$7.66
Engine Family
Annual Production
= 90,000, metallic
honeycomb
substrate
$8.00
$0.58
$1.20
$0.90
$0.98
$11.66
Engine Family
Annual Production
=400,000, ceramic
honeycomb
substrate
$4.00
$0.58
$0.30
$0.90
$0.24
$6.02
Engine Family
Annual Production
=400,000, metallic
honeycomb
substrate
$8.00
$0.58
$0.30
$0.90
$0.24
$10.02
MECA provided NPRM comments on the cost of catalysts (Docket Item IV-D-13), of
several conversion efficiencies, for Class IV. Table 3-07 presents a summary of the data supplied
by MECA. MECA states that the costs may decrease over time if catalyst technology is
encouraged to develop. MECA's cost estimates do not include a number of costs including other
costs of the catalyst system (as shown in Table 3-06), the production steps to install the catalyst,
or related components on the engine.
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Chapter 3: Technologies and Standards
Table 3-07
Summary of MECA per Engine Cost Estimate for Catalyst of
Specific HC+NOx Conversion Efficiency per Class
Units of
Production
5,000
10,000
several
million
Class IV
1.0hp2s
cat eff 40%-
>20%*
Engine new
172g/kW-hr
-
$6.25
$4.13
Class IV
1.0hp2s
cat eff 60%-
>30%
Engine new
172g/kW-hr
-
$6.33
$3.50
Class IV/V
1.7hp2s
cat eff
40%->20%
Engine new
172g/kW-hr
$6.28
-
$4.03
Class IV/V
1.7hp2s
cat eff
60%->30%
Engine new
172g/kW-hr
$6.83
-
$3.83
Class IV
0.85hp 4s
cat eff
40%->20%
Engine new
54 g/kW-hr
-
$4.72
$3.05
* - Note: the range of efficiency represents catalyst new and catalyst used
Combining the catalyst cost from Table 3-07 and the labor, fixed and hardware costs from
Table 3-06, the cost of adding a ceramic honeycomb substrate catalyst to an engine could range
from $5.52 (industry wide, several million units) to $8.35 (5,000 to 10,000 units for one catalyst
manufacturer)23 depending on the conversion efficiency of the catalyst, engine out emissions and
volume of industry usage. Echo provided comments in their response to the SNPRM (Docket
Item IV-D-37) that their estimate for the cost of a catalyst system including the holder, shrouding
and cooling requirements is approximately $15.00. (For a discussion of the catalyst cost
assumptions for the final rule cost analysis, see Chapter 4.)
The costs shown in Tables 3-06 and 3-07 account only for the cost of adding a catalyst to
a Phase 1 technology two-stroke engine, not for internal improvements that are necessary to the
engine. Internal engine improvements are necessary in order to lower engine out emissions and
increase engine out in-use durability prior to the application of a catalyst. Total costs for various
technologies to employ a catalyst are discussed in three respective sections (Sections 3.2.1.4,
3.2.2.4 and 3.2.3.4).
3.2.4.5 Impact on Equipment Design and Use of Catalyst - Conversion of pollutants by
catalysts contained within the muffler result in increased exhaust gas and muffler skin
23
MECA provided the estimate of several million based on the concept that it was
an industry-wide market, not engine family specific. The cost estimate for 5,000
and 10,000 is based on engine family annual volume. EPA is assuming that this
can also be interpreted to mean that 5,000 or 10,000 is the only volume that the
catalyst manufacturer sees from the industry.
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Chapter 3: Technologies and Standards
temperatures. The amount of improvements needed by the equipment will be governed by the
degree of cooling required by the engine with the new technologies, specifically catalysts. The
following paragraphs describe the test data on catalyst temperatures on Phase 2 technology
engines and then describe the likely impact on equipment.
Test data on temperature measurements with and without catalysts were collected by EPA
in its testing of the John Deere LE engine and the Komatsu Zenoah stratified scavenged with lean
combustion engine with and without a catalyst. Both the John Deere engine and the Komatsu
Zenoah engine tested by EPA were prototypes of the designs currently certified by the
manufacturers with the California ARB for the 2000 model year. Therefore, the absolute
temperature results are not necessarily indicative of the currently certified engines. However, the
effect of the catalyst on temperatures is useful information, especially if a base equipment design
(i.e., the equipment without a catalyst) is close the U.S. Forest Service temperature requirements.
Testing included temperature measurements to determine the amount of temperature increase
with an associated catalyst conversion efficiency specific to these engine technologies. The
following results are taken from Reference 7. It should be noted that while EPA did attempt to
test according to the U.S. Forest Service test requirements, the EPA laboratory where the testing
was performed is not officially licensed to do this test and it was the first time that these tests
were conducted at the laboratory, and they are therefore considered preliminary. In addition, in
many cases, it was discovered that the muffler skin temperatures were taken in error when it was
to be the exposed surface plane temperature as outlined in the test guidelines. However, the
increase in temperatures, between catalyst and non catalyst use is still noteworthy.
The prototype John Deere LE engine was tested without and with a catalyst. The catalyst
used in the testing was one which was provided by John Deere and contained a long tube
attached to the muffler outlet. Therefore, exact exhaust temperatures are not available for
comparison. In testing, the plane for the exhaust gas temperature on the baseline muffler was
approximately 3/4 of an inch away from the exhaust muffler outlet. The exhaust gas
temperature on the catalyzed muffler was measured 3/4 of an inch from the opening of the tube,
which was 2.16 inches long from the muffler surface. These temperatures are not taken in the
same respective place and therefore cannot be directly compared. The shroud had also been
removed during previous tests in the EPA test program. The results of the testing show that the
cylinder temperature rose approximately 10° C with the use of the catalyst, the muffler skin
temperature rose approximately 20° C with the use of the catalyst, and the exhaust gas
temperature rose approximately 147° C. (As noted above, the exhaust gas temperature
measurement placement was not at the same location in the base engine and the catalyzed engine
tests.)
Temperature measurements for the Komatsu Zenoah Air Head Engine were also obtained
during the EPA test program both on the base engine and the engine equipped with three
different catalysts. The thermocouple placement for the exposed surface plane was not correct
for the test and therefore no exposed surface plane temperature data is available. However,
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Chapter 3: Technologies and Standards
exhaust gas plane temperature and muffler skin temperature data were gathered. Complete
results of the testing are available in the final test report.(Ref. 7) For the engine tested with the
first catalyst (catalyst SU00895), the test results show an increase in engine cylinder temperature
of 17-25° C due to the catalyst, an increase in exhaust gas temperature of 67-115° C due to the
catalyst, and an increase in muffler skin temperature of 14-50° C due to the catalyst. For the
engine tested with the second catalyst (catalyst SU00908), the test results show an increase in
engine cylinder temperature of 7-9° C due to the catalyst, an increase in exhaust gas temperature
of 85-100° C due to the catalyst, and an increase in muffler skin temperature of 66-97° C due to
the catalyst. (Data for an additional catalyst are not presented here due to concern over the
validity of the test data..)
A 40cc Tanaka engine, which incorporated internal engine redesign and a catalyst, was
also tested by EPA in the summer of 1999 (Ref. 7.) and the outer design of the muffler and
engine shroud was noted. The design was found to incorporate several unique changes when
compared to other conventional engine designs. First, the muffler exhaust is on top of the
muffler and points to the side of the engine housing. Second, the engine housing shroud exhaust
area is placed on the side of the muffler housing some distance away from the muffler exit.
Third, the engine's plastic shroud incorporates wide open slots around the muffler. These
changes are possible on equipment such as trimmers and blowers, which allow for extra room
around the muffler and whose engine shroud need be designed to keep a relatively small amount
of debris away from the muffler. However, the application of all of these changes will likely
require adjustment when an engine manufacturer is addressing a chainsaw.
Applications with less available space for extension may incorporate internal design
changes to the mufflers. Internal redesign may include passages for additional air flow to the
exhaust gas stream in order to decrease the exhaust gas temperature. This may be done through
changes in the internal design of the muffler and/or the addition of an outer skin to the muffler
which would make the muffler larger than its current size and therefore require engine shroud
redesign. The shroud around the muffler may need to be extended in order to provide room for
the addition of heat shielding or other safety shields to protect the engine and the user from
excessive muffler skin temperature.
Extra cooling will likely be required by the engine as well to assure it does not seize due
to less fuel cooling and presence of an additional potential heat source (a closely coupled
catalyst). This may require a larger engine fan and redesigned engine fins which may require
expansions in the engine shroud design. The path of air cooling may also need to be designed in
the engine shroud.
The addition of a catalyst would also add weight to the engine, however, the added
weight would likely be negligible compared to the dry weight of the engine and equipment. For a
metal plate design, such as that used by Husqvarna, the catalyzed plate replaces an existing baffle
plate in the muffler so weight would not be increase appreciably. For an add-on to a muffler, the
35
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Chapter 3: Technologies and Standards
weight of the catalyst and housing will depend on the size of the catalyst. EPA estimates this
weight to be 50 grams or less. This compares to the weight of handheld equipment that currently
is in the range of 5 to 25 pounds. Changes to shrouding should, for the most part, involve
changes in configuration, not changes in the mass of the shrouding.
3.2.4.6 Catalyst Technology Impact on Noise, Safety, and Energy ~ The Agency would
expect little impact on engine noise from the application of catalysts to small engines. If any
impact on noise did occur, it is likely the catalyst plus a redesigned muffler would act to lower
the noise generated by an engine, since the catalyst would absorb and not generate sound.
Engine manufacturers have raised concerns regarding the safety of catalysts on small
engines. The principal concerns relate to increases in muffler skin temperature and exhaust gas
temperature from the use of a catalyst. Title 36 CFR 261.52 directs the Forest Service to prohibit
the operation or use of "any internal or external combustion engine without a spark arresting
device properly installed, maintained and in effective working order meeting either :(1)
Department of Agriculture, Forest Service Standard 5100-a; or (2) appropriate Society of
Automotive Engineers (SAE) recommended practice J335 and J335(a)." SAE J335 contains
instructions for determining planes at which to measure exhaust gas and surface temperatures and
states recommended performance levels (i.e.: temperatures) which should not be exceeded. In
order to continue to meet the requirements of the J335, manufacturers may need to limit the
conversion efficiency of the catalyst in order to maintain a comfortable margin of safety below
the requirements, and/or redesign the muffler system to enhance the heat shielding of the muffler.
Echo responded to the SNPRM (IV-D-37) that" burning more than 15 grams of THC may cause
heat and safety concerns. Handheld equipment is operated and controlled by the operator. As
such, it comes in very close proximity to the operator's hands, arms, face and body. Heat
dissipation to prevent operator injury is a primary concern."
Currently, Husqvarna has four engine families certified to EPA's Phase 1 standards which
utilize a low efficiency catalyst and continue to meet all applicable U.S. Forest Service
requirements (see Table 3-08). In addition, Stihl, Echo, and Mitsubishi have all certified
handheld engines meeting the California ARB's 72 g/kW-hr HC+NOx standard for the 2000
model year that also employ catalysts. Thus, it is proven that at least for designs meeting the
California HC+NOx standard of 72 g/kW-hr, adequate control of catalyst safety concerns is
available. As long as similar efficiency catalysts are used to meet the standard, given sufficient
engine cooling is available, then it is assumed there will be little if any problems with catalyst
feasibility. However, higher conversion efficiencies and increased cooling needs by the engine
may raise concerns.
To meet the more stringent EPA Phase 2 standards, for Class HI and IV engines, either a
higher conversion efficiency catalyst or lower engine out emissions will be required. Higher
conversion efficiency catalysts are available, however, their use will result in higher exhaust
temperatures if no other changes are made to the engine or the equipment. EPA has already
36
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Chapter 3: Technologies and Standards
identified several technologies which will lower the engine-out emissions including compression
wave and stratified scavenging two-stroke technologies and four-stroke designs as an alternative
to the two-stroke engine. Clearly, the compression wave and four-stroke technologies can meet
the California ARB's 72 g/kW-hr HC+NOx standard without catalysts as they have already
demonstrated this through certification. Four-stroke engines will not need to use catalysts to
meet the EPA Phase 2 standards. Two-strokes with compression wave or stratified scavenging
technology are assumed to use catalysts for Class in engines. For Class IV engines, John Deere
has estimated that less than 50% of their applications will require the addition of catalysts. For
these Class in and IV engines requiring catalysts, with compression wave technology, the
amount of exhaust gas conversion should be no greater than that already occurring on engines
using other engine technologies plus a catalyst to meet the California ARB standards. Thus, the
same heat mitigation measures should be available: engines using compression wave and a
catalyst to meet EPA's Phase 2 standards can also incorporate cooling, shrouding, etc. and meet
the U.S. Forest Service requirements.
For engine designs currently meeting the California ARB HC+NOx standard of 72 g/kW-
hr but with a catalyst, additional cooling and shrouding is available to handle the extra heat
generated by a high conversion efficiency catalyst installed to meet the more stringent EPA Phase
2 standards. This additional cooling and/or shrouding is especially available for applications
such as string trimmers and blowers. Such applications should be able to be redesigned to
provide all the necessary extra cooling and shrouding necessary to meet the U.S. Forest Service
requirements and adequately protect the operator.
The most difficult applications are the chainsaws and similar applications where
packaging constraints are most significant. For Class IV chainsaws it is possible to improve air
flow, increase engine fin area, and reconfigure the shroud without significantly affecting weight
or other ergonomic features. These changes will suffice to handle the excess heat due to the use
of a catalyst (or a higher efficiency catalyst compared to a design meeting the less stringent
California ARB standards.) Alternatively, the manufacturer may take advantage of the averaging
program and install catalysts on their "easier" designs (e.g., string trimmers and blowers), and
generate excess credits to offset higher emission on the "more difficult" designs (e.g.,
chainsaws), obviating the need to redesign the equipment in response to these potential heat
concerns. Finally, the manufacturer may choose to go to an alternative engine technology than
currently being used to meet the California ARB's HC+NOx standard of 72 g/kW-hr in order to
achieve lower engine out emission levels, thus addressing this catalyst heat concern.
In conclusion, the engine and equipment manufacturer must carefully consider the
cooling and safety implications of catalyst installation and reflect this in its design strategy for
the engine and equipment. Several options are available including the application of those design
features already incorporated on handheld equipment which have designed for safe operator use
and in compliance with the U.S. Forest Service requirements.
The addition of a catalyst would have no significant impact on the energy consumption of
an engine. Catalysts are add-on devices which would have minimal, if any, impact on the
37
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Chapter 3: Technologies and Standards
engine's air/fuel ratio or power output, and therefore no change in fuel consumption is
anticipated. Other changes to the engine, made in order to reduce emissions to more easily
utilize a catalyst, would be credited with fuel consumption savings.
3.2.5 Internal Two-stroke Engine Redesign With a Catalyst
As noted in section 3.2.4., some technologies have been developed to meet a standard of
54 g/hp-hr (72 g/kW-hr) as required by the California ARB. Improvements in internal two-
stroke engine design (transfer ports, piston, combustion chamber, etc.) and the addition of a
catalyst will allow low emissions such as the 72 g/kW-hr HC+NOx level to be achieved on some
engine sizes and applications. The amount of emission reduction achievable with this technology
package will largely depend on the level of emissions exiting the engine prior to the catalyst.
The level to which emissions can be reduced with engine improvements determines the
percentage conversion efficiency catalyst that can be used on the engine. The catalyst conversion
efficiency is limited by the heat produced, by oxidation of pollutants, such that temperatures in
predefined planes are in accordance with the U.S. Forest Service temperature requirements and
other company specific safety requirements.
3.2.5.1 Description of Technology — The simply designed two-stroke engine has room
for improvement when it comes to emission reduction. Internal design changes will improve
emissions characteristics. As listed in the Stratified scavenging with lean combustion section on
Komatsu Zenoah, changes include the following:
1. Higher compression by reducing crankcase volume
2. Change combustion chamber geography. (E.g., slightly dome the piston to mate with
hemispherical combustion chamber and is fit it with two compression rings)
3. Move spark plug to a straight up, dead center location to maximize combustion dynamics.
4. Alter timing and spark energy
Other internal engine improvements include design improvements in the engine transfer ports.
The use of a catalyst provides additional emission reduction.
3.2.5.2 Current State of Technology Development —
3.2.5.2.1 Husqvarna E-TECH Engine — The E-TECH engine is an engine
equipped with a new type of crankshaft enclosure which gives increased crankcase pressure. The
higher crankcase pressure and higher pressure in the exhaust system gives the E-TECH engine
unique possibilities for lower emissions and a high level of performance. The E-TECH engine is
equipped with a new type of lightweight catalytic converter for handheld products. The entire
catalytic converter installation gives a weight increase of only 10 grams. The E-TECH design
reduces both hydrocarbon and nitrogen oxide emissions.
3.2.5.2.2 Tanaka Stratified Charge Engine With Catalyst ~ An in-depth
description of the Tanaka technology has been published in Power Equipment Trade July/August
1998. Excerpts from the article are included below. The article states that "Tanaka's PureFire
38
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Chapter 3: Technologies and Standards
technology cuts scavenging losses by changing and better controlling air/fuel from crankcase to
combustion chamber."
1. "The air/fuel charge enters the crankcase like any piston ported two-stroke - through the
cylinder intake port as the piston goes up. As the piston comes down, the air/fuel mixture
is compressed as usual. However, instead of squirting up into the combustion chamber
via transfer ports, the Pure Fire intake charge is forced through a small port on the bottom
of the crankcase." (The transfer channel formed in the crankcase mounting surface runs
from the bottom of the crankcase up into the cylinder mounting surface. The four transfer
ports are fed through this plumbing system.)
2. "As it travels through the crankcase channel, the fuel charge absorbs crankcase heat,
which improves atomization. Furthermore, the channel's small volume and curved route
increase flow speed and cause a centrifugal effect." According to Tanaka this "causes a
higher content of the fuel (portion of the mixture) to be delivered into the cylinder during
the combustion stroke."
3. "The now layered intake charge flows under the cylinder and into its four closed transfer
ports. They are located so that the more concentrated air/fuel are farthest away from the
exhaust port."
4. The U-shaped piston ridge's "open end is aimed toward the exhaust port. When the
piston is at bottom-dead-center, the ridge is opposite the four transfer ports. In this
position, the bottom of the ridge is about level with the bottom of the exhaust port. The
top is about half the height of the port. The ridge doesn't block the port, but it acts like a
dike that directs the transfer charge away from it. This setup greatly reduces cross-
cylinder flow and exit of unburned air/fuel mix."
5. "As the piston moves up, the ridge traps the intake charge and concentrates it around the
spark plug electrode. Remember, the top of the cylinder is mirror image of the piston
ridge. The two components mesh to form a concentrated combustion chamber.... This
design allows more complete combustion which results in fewer emissions. Catalytic
mufflers can't do the job alone, and they can't survive if the exhaust is too dirty so this is
important."
6. The muffler contains a catalytic converter and the spark arrestor setup is typical. The
catalyst is cylindrical and it is welded to a square plate which is welded to the inside
surface of the muffler. The catalyst is 1 3/8 inches in diameter and 1.5 inches long. The
honeycomb substrate is covered with a washcoat of noble metals. Exhaust gas must pass
through the honeycomb substrate; the material gets extremely hot. It takes a few minutes
of operation to get the catalyst up to its working temperature. The catalytic muffler
represents about 40 percent of Pure Fire's emissions reducing technology. The other 60
percent takes place in the crankcase and cylinder.
39
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Chapter 3: Technologies and Standards
This is a quality engine and the engine contains a connecting rod and three piece
crankshaft which are quality forgings. Rod ends float on caged needle bearings and the big end
is slotted to improve lubrication. The engine uses a conventional intake system with standard
Walbro WYJ rotary valve carburetor.
3.2.5.3 Exhaust Emissions Performance —
3.2.5.3.1 Husqvarna's E-Tech ~ Husqvarna's E-tech engine has achieved
compliance with California ARB's 1995 standards, however it has not yet reached levels as
finalized in this rulemaking and none are yet certified to the California ARB's model year 2000
standards. There are, however, additional internal upgrades that may be made as are identified in
the Tanaka and Komatsu Zenoah technologies. It is likely that the application of these additional
improvements will reduce emissions from where they are currently.
Husqvarna's EPA Phase 1 certification data contains the information contained in
Table 3-03. The table is presented again below as Table 3-08. These emission results are from
the rich setting of the engine (note: engines must meet emissions in the full range of the
carburetor adjustment and therefore worst case is presented here.)
Table 3-08
New Husqvarna Phase 1 Certification Engines With Catalysts
Class IV Trimmer/Edgers (g/kW-hr)
Engine Family
XHVXS.0254EB
XHVXS 0274 EA
XHVXS.0314EA
XHVXS.0364EA
Power
0.86kW
0.9kW
1.07kW
1.31kW
Displacement
24.5cc
25.4cc
30.8cc
36.3cc
HC
181.9
183.9
157.0
154.5
CO
622.3
663.1
551.2
595.8
NOx
0.3
0.2
0.2
0.3
3.2.5.3.2 Tanaka Pure Fire - Tanaka's 39.8cc two-stroke engine achieves
levels of 45.11 g/hp-hr (60.5 g/kW-hr) HC+NOx and 117 g/hp-hr (157 g/kW-hr) CO after 300
hours of in-use as shown by certification to the California ARB standards. The 26cc engine has
certified at 45 g/hp-hr (60 g/kW-hr) HC+NOx and 85 g/hp-hr (114 g/kW-hr) CO. These
emission levels do not meet EPA's finalized Phase 2 standards. In order to determine whether
additional catalyst efficiency is possible with this design, EPA included a 40cc trimmer engine in
its small engine test program (Ref. 7). It was determined that the catalyst on the engine in the
test program converted 67 g/hr HC for the 1.2 kW engine. Based on the in-use certification
value of this engine, this is already near 50 percent conversion efficiency and a total of 65.5
percent conversion efficiency would be needed to meet 40 g/kW-hr (to allow for compliance
margin to the final 50 g/kW-hr standards). It is unknown as to whether this high of a conversion
efficiency is possible on small engines due to the short residence time of the exhaust gas as it
40
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Chapter 3: Technologies and Standards
passes through the catalyst at a specific space velocity. However, higher conversion efficiencies
may be possible as shown in the California ARB certification in Appendix D because Stihl has
certified a 27.2cc engine, also used in trimmers, both with and without a catalyst. The catalyst is
estimated to have a conversion efficiency of approximately 60 percent based on the certification
levels of the two engine families.
3.2.5.4 Technology Cost ~
3.2.5.4.1 Husqvarna - Publicly available cost information on modifications
for the E-tech, and potential future E-tech engine designs, is not available.
3.2.5.4.2 Tanaka with Catalyst - Based on Tanaka's statement about its
engine, as noted below, the cost increase is estimated to be around 5%. Tanaka's grass trimmer/
brushcutter equipment, which use Class IV engines, retail for $450 to $500. The estimated
increase in retail cost would therefore be around $22.50 to $25. Backing out retail markup
(estimated to be 29 percent for this analysis) results in a price impact of $17.44 to $19.38.
3.2.5.5 Impact on Equipment Design - Based on the engine/equipment design
relationship, there can be a range of equipment design impacts. The equipment must employ
measures to assure that the equipment meets the U.S. Forest Service requirements and this may
mean adding additional shrouding around the muffler to mix air with the exhaust gas before it
exits the muffler. Changes in the crankcase may influence the equipment shrouding to the extent
that it influences the outer dimensions of the engine.
Tanaka has stated the following: (1) their engine has two ounces more weight, (2) 10
percent less power (therefore moving toward slightly larger displacements), (3) 5 percent more
cost, (4) this technology may be applicable only to pro-quality equipment for the cost impact
might be too high for low-cost consumer-quality engines, (5) the weight of the equipment is 18.5
pounds, and is fueled with 50:1 ratio of gas/oil mix.
3.2.5.6 Technology Impact on Noise, Safety and Energy —
3.2.5.6.1 Husqvarna E-Tech — This engine technology employs a catalyst and
the equipment meets the U.S. Forest Service temperature requirements for exhaust gas plane and
exposed surface plane. The technology will result in less fuel consumption based on the internal
improvements made in the engine. As relates to noise, there is likely a slight benefit, due to the
presence of the catalyst.
3.2.5.6.2 Tanaka Pure Fire ~ We presume this engine as certified for use in
equipment meets the U.S. Forest Service temperature requirements. Tanaka states that the
engine achieves a 30 percent reduction in fuel consumption. As relates to noise, there is likely a
slight benefit, due to the presence of the catalyst.
3.2.6 Spark-Ignition Technology
3.2.6.1 Description of Technology — During the summer of 1998,
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Chapter 3: Technologies and Standards
Pyrotek presented EPA with information on a spark-ignition technology that it had developed. It
is a very simple technology and has shown to yield lower emissions in two-stroke engines. The
technology described herein is considered a supplemental technology based on the fact that an
engine manufacturer cannot rely on the technology alone to meet the finalized standards. Initial
data (Ref 9) showed that it may provide a benefit over the useful life of the engine. More
recent data (Ref. 10), on catalyzed two-stroke engines aged over 25 hours, indicates there is
minimal advantage with use of the spark plug due to the fact that the differences in the catalysts
efficiencies on two different engines outweighed the advantages with the spark plug technology.
Therefore, this technology is best considered when no catalyst is used. The following discussion
is focused on the data contained in Reference 9.
3.2.6.2 Current State of Technology Development - Versions of the spark-ignition
technology are in the marketplace today, however the inventors have investigated those
technologies and note that theirs has some benefits that have not yet been included in previous
designs.
3.2.6.3 Exhaust Emissions Performance ~ Pyrotek has performed a number of tests of
the technology on two-stroke and four-stroke engines. They have seen a notable benefit in new
engine values on two-stroke. The tests have confirmed improved BSFC and it is believed that
the absence or reduction of combustion chamber deposits over time would contribute to
improved emission deterioration over time. Some durability tests have been performed on two-
stroke engines.
The engines selected for the study were two-stroke Homelite super 2 chainsaw engines
(Model No. 246Y, air-cooled, single cylinder, piston ported, supplied with a DJ7Y plug 32.4
cubic centimeter displacement). The engines were tested new and the emission levels noted in
Table 3-09 were achieved. Refer to the report for testing specifics.
Table 3-09
Engines At New (0 hours)
Parameter
Power (kW)
HC (g/kW-hr)
CO (g/kW-hr)
CO2 (g/kW-hr)
NOx (g/kW-hr)
BSFC (g/kW-hr)
Fuel Flow (g/hr)
Engine #2
Conventional
1.03
154.0
292
936
2.42
653.4
673.4
Engine #1 Pyrotek
0.98
166.0
268
1010
2.51
676.2
661.5
Engine #1
Conventional
0.99
165.5
310
965
2.00
691.8
684.0
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Chapter 3: Technologies and Standards
After 25 hours of operation the results in Table 3-10 were seen.
Table 3-10
Emission Results After 25 and 50 Hours
Parameter
Power (kW)
HC (g/kW-hr)
CO (g/kW-hr)
CO2 (g/kW-hr)
NOx (g/kW-hr)
BSFC (g/kW-hr)
Fuel Flow (g/hr)
25 Hours
Engine #1
Pyrotek
0.97
135.6
193
1096
6.29
700.9
676.5
Engine #2
Conventional
0.93
158.40
260
1030
4.11
754.6
701.4
50 Hours
Engine #1
Pyrotek
0.97
125.4
215
965
2.85
750.2
726.7
Engine #2
Conventional
0.85
178.2
342
985
2.35
803.6
686.4
The report points out that the emissions from the engine with the Pyrotek spark plug has
lower emissions by 25 percent for CO and 14 percent for HC after 25 hours. The differences in
HC and CO in both engines compared to data in Table 3-09 are partly due to the different
ambient humidities for the 0 and 25-hour tests.
The engines were run for another 25 hours (total of 50) and the emissions were measured.
It should be noted that the engine with the conventional spark plug had trouble starting and
therefore the start procedure was repeated for 10 minutes until it finally started. The engine with
the Pyrotek spark plug started without difficulty. Results show the engine with the Pyrotek plug
was lower than the engine with the conventional plug by 37 percent for CO and 29 percent for
HC. The report states that "it is likely that the high level of HC emission of the engine with the
conventional spark plug may have been partly caused by the amount of priming used when
starting difficulties were experienced."
Upon completion of the test, each engine was dismantled and examined. The report
stated that "the engine fitted with the conventional spark plug had a considerable build-up of
soot-like deposits in the piston-ring grooves and around the exhaust port. Also, the piston face
and combustion chamber walls of this engine showed many regions of small
discoloration/damage on the piston face of the engine with the Pyrotek plug was considerably
less and much more uniform. The Pyrotek spark plug exhibited a light brown discoloration of
the insulation around the center electrode, while this region of the conventional plug was
43
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Chapter 3: Technologies and Standards
considerably darker." Photographs of the engine are available in the report.
3.2.6.4 Technology Cost - In recent correspondence with EPA, Pyrotek estimated the
cost of the technology would not exceed a total cost of $1.97 per unit.(Ref 11)
3.2.6.5 Impact on Equipment Design — The spark-ignition technology would replace
the existing spark plug. Therefore, besides an increase in exhaust and cylinder head temperatures
at wide open throttle of approximately 20° C for the Pyrotek spark plug, which additional fins
may be able to dissipate, there is no expected impact on the equipment.
3.2.6.6 Technology Impact on Noise, Safety and Energy ~ No changes are expected
based on this spark plug technology.
3.2.7 DIPS
3.2.6.1 Description of Technology - - During the Fall of 1999, EPA was
presented with information on a new spark-ignition technology that shows promise to reduce
emissions from two-stroke engines. As described by the developer, the DIPS technology is a
combination of two technologies including the FAST system, an air assisted direct fuel injection
technology, and the "split uniflow engine with asymmetric timing". The advantages of this
technology include 1) use of air as scavenger, 2) a high degree of atomization of the fuel thereby
leading to complete combustion of the fuel, 3) less fuel consumption, 4) keeps high power to
weight ratio in a compact package (an engine with this technology can be the same size as the
existing engine). Preliminary testing of the technology in a 25cc trimmer prototype resulted in
new engine HC emissions of 21.1 g/kW-hr at WOT. The projected cost for this technology is
$6.00 plus licensing fee. It could be a competitive option for the industry since it may not need
to employ a catalyst to reach EPA's Phase 2 standards. Because of the preliminary nature of this
information, we have not considered this technology as part of our cost or feasibility analysis.
Additional information on this technology can be found on the Internet at www.dipspower.com.
3.3 Exhaust HC+NOx Standards for Class III. IV and V Engines
This section contains information the Agency used to determine the appropriate standards
contained in the regulations. Additional information is contained in the Preamble for this
Rulemaking.
The handheld engine industry is made up of manufacturers that make small engines for a
variety of applications and intended users (residential and commercial). Engine families certified
to the Class in standards are used almost solely in trimmers/edgers/cutters and the majority of
engines are sold mainly to low use residential consumers. The engine families certified in
Class IV cover a wider range of applications from trimmers/edgers/cutters, generator sets and
blowers to chainsaws for use by low use residential consumers and high use commercial users.
Engine families certified in Class V are mainly used in chainsaws, rammers, and cutoff saws
aimed at the commercial users. Very few trimmers and blowers are certified in this class.
The Agency expects the finalized in-use standards can be met through conversion to four
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Chapter 3: Technologies and Standards
stroke, stratified scavenged with lean combustion engine with a medium/high efficiency catalyst
(in Classes HI and IV) and without a catalyst (in Class V), and compression wave technologies
with a medium efficiency catalyst (in Classes HI and IV) and without a catalyst (in Class V).
Other supporting technologies include engine redesign plus catalyst and potentially spark-
ignition technologies. It should be noted, however, that there are currently limitations to the
application of some of these technologies to all engine sizes covered by this rulemaking.
Limitations for some of the technologies include limited loss in power, engine technology
size and/or technology performance. Technologies in which there have been measured limited
losses of power from the original engine design include engines that incorporate stratified
scavenging. However, it should be noted that the stratified scavenging design from Komatsu
Zenoah also utilizes lean combustion and therefore the engine power loss is much less than could
be anticipated with just stratified scavenging. Four-stroke technology has several issues for
engines in the upper size range of Class V engines. The concerns are over the power/weight ratio
as well as the acceleration of the engine, which relates to technology performance. Technology
performance also relates to concerns over medium and high efficiency catalysts, especially in
Class V engines that have not reduced engine out emissions significantly. The volume of
exhaust flow is much greater on larger engines and therefore the ability of a catalyst to convert
the same efficiency of pollutant, as on a smaller engine, and still remain cool enough to meet the
U.S. Forest Service temperature limits, has proven difficult for manufacturers.
John Deere has indicated that they see no reason for limitation of use of the LE
technology on all small engines. Engine manufacturers of professional use products in Class V
have expressed concerns with the technology on their products. Specific concerns include
lubrication in high speed and high load applications, such as chainsaws, and smooth fuel system
operation across all modes of equipment use. Based on the most up to date information from
John Deere (SNPRM comments, Docket Item IV-D-48 and California ARB certification), EPA
is optimistic that manufacturers will be able to apply the technology to slightly modified existing
two-stroke engines in all applications and sizes, while achieving significant emission reductions.
Without further improvements to current designs, the addition of a medium efficiency or
a medium/high efficiency catalyst will be required in order for the technologies of John Deere LE
and Komatsu Zenoah stratified scavenging with lean combustion to achieve the Phase 2
standards in Class HI and IV applications. (As noted earlier, John Deere has estimated that with
averaging available, approximately 50% of their Class IV applications can be certified without
the use of a catalyst.) However, information on application of a catalyst to engines with these
technologies is limited because manufacturers have been focusing on meeting standards for
California ARB which do not require catalysts. EPA has tested the John Deere LE engine and
the Komatsu Zenoah stratified scavenging with lean combustion engines with catalysts, very
close to the efficiencies that will be required, and has observed that there will be cooling issues
for the manufacturers to address. However, given the leadtime before full implementation of the
standards, we are confident that manufacturers can address such issues successfully.
Table 3-11 contains a summary of publicly available emission data from a number of
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Chapter 3: Technologies and Standards
technologies described earlier in this chapter. The in-use HC+NOx values are listed next to the
related technology. Some in-use values are estimated and some are from manufacturer data as
certified to California ARB standards. A column has been included which estimates emissions if
a catalyst is utilized on the engine. With the low engine out emissions achieved by these
technologies, a 30g/kW-hr catalyst may be possible for most applications.
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Chapter 3: Technologies and Standards
Table 3-11
Technologies and Likely Achievable In-Use HC+NOx Emissions
Technology/
Manufacturer
Stratified Scavenging
Lean Combustion*/
Komatsu-Zenoah
(25.4cc)
Stratified Scavenging
Lean Combustion*/
Komatsu-Zenoah
(33.6cc)
Four-stroke*/ Honda
(49.4cc)
Four- stroke/ Honda
(31. Ice)
Four-stroke /FUJI
(24.5cc)
Four-stroke/Ryobi
(26.2cc)
Four-stroke/Ryobi
(26.2cc)
LE Engine
Technology/ John
Deere Consumer
Products
LE Technology/ John
Deere on 70cc Stihl -
preliminary
prototype
HC+NOx
(g/kW-hr)
66.0
53.1
25.4
40.9
17.0
15.0
21.0
66.8
61.1
50.0**
Methodology for
Calculation of
in-use emission
California ARB cert
data (300 hrs)
California ARB cert
data (300 hours)
California ARB cert
data (300 hours)
California ARB cert
data (300 hours)
California ARB cert
data (125 hours)
California ARB cert
data (50 hours)
California ARB cert
data (300 hours)
Docket Item IV-G-32
with assumed 1.1 df
California ARB
certification data as
(125 hours)
Docket Item IV-D-48
with assumed 1.1 df
Class and
Application
Class IV
trimmer
Class IV
trimmer
Class IV
generator
Class IV
Class IV
Class IV
Class IV
Class IV
trimmer
Class IV
Class V
chainsaw
Assuming cooling is
available, emissions
w/ 30g/kW-hr Catalyst
for III & IV
36.4
22.9
NA
NA
NA
NA
NA
36.8
31.1
meets standard
* - Technologies may be limited in applicability to all sizes and applications of handheld engines.
**- These results are from use of preliminary fuel system. On the Class IV trimmer, emission results increased
with latest fuel system design and it is expected the same will happen if the fuel system were applied to the
Class V engine. Also, issues of application of technology to professional Class V engines, including
lubrication, etc. remain unanswered due to no further work on prototype. However, the Class V HC+NOx
standard of 72 g/kW-hr is much higher than the prototype achieved.
47
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Chapter 3: Technologies and Standards
Due to the feasibility of technologies, or very promising technologies, demonstrated by
manufacturers in Class IV engines, as shown in Table 3-11, it is believed that low emissions are
achievable. Based on information available at the time this document was prepared, EPA
believes four stroke technology will be very cost-effective for high production engine families
and technologies such as the John Deere LE engine or Komatsu Zenoah stratified charge will be
relatively cost-effective for low and high volume engine families. While the engine cooling
capabilities of an engine will need to be improved due to less fuel/oil cooling (due to the use of
stratified scavenging or reduced scavenging designs), EPA believes that there is some additional
cooling available for the application of a medium/high efficiency catalyst. Therefore, the Agency
is finalizing an average in-use HC+NOx standard of 50 g/kW-hr for Classes HI and IV. These
standards would be applicable for the useful life categories of 50, 125, and 300 hours. The
Phase 2 standards would phase-in from model year 2002 through 2005 for Classes HI and IV as
shown in Table 3-12.
For Class V engines, Table 3-11 shows results for only one engine and it is on a
preliminary prototype using the John Deere LE technology on a 70 cc Stihl engine.24 The EPA is
optimistic that the John Deere LE technology and Komatsu Zenoah stratified scavenged with
lean combustion technology will both be applicable to professional equipment in Class V, even
though they have not yet been proven in the marketplace. The application of catalysts in addition
to these technologies is currently not seen as feasible due to the lubrication and cooling
requirements of the low emitting technologies as applied to professional chainsaws which make
up the majority of equipment in this class. Chainsaws have tight packaging around the engine
and related components, such as the muffler, and therefore limited additional cooling when
compared to other applications such as trimmers. The cooling that is available is best utilized to
account for the cooling requirements of low emission technologies rather than catalysts, mainly
due to the potential for emission reduction and lower deterioration of the technologies compared
to catalysts. However, if the compression wave or stratified scavenging with lean combustion
technologies need to be run richer than on the Class IV engine to provide sufficient lubrication,
then possibly the available cooling not required by the technology can be used to cool a muffler
with a low efficiency catalyst. Based on this analysis, a standard of 72 g/kW-hr is being finalized
for Class V engines.25 The standard would be phased-in from 2004 to 2007 for Class V as shown
in Table 3-12 in order to provide additional development time for application of low emitting
technologies to this class and specific applications which have only been completed in limited
prototype to date. The phase-in period plus the lead time anticipated will allow manufacturers
two to seven years to make the necessary changes to existing product lines in order to meet the
24 It is understood that there are limitations in the application of four-stroke
technology across the entire range of Class V engines due to the power/weight and
acceleration in Class V applications.
25 72 g/kW-hr is the same as the Phase 2 standard the California ARE has set for a
portion of such engines (<65cc) which are not exempt from their rulemaking.
48
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Chapter 3: Technologies and Standards
standards26. Flexibilities for small-volume engine families and small-volume engine
manufacturers allow a slightly longer timeframe.
Phase 2 technology two-stroke engines will result in approximately a 70 percent reduction
in the in-use emissions of small spark-ignition handheld engines at or below 19kW once fully
implemented.
Table 3-12
Phase-in HC+NOx Standards (g/kW-hr) for Handheld Engines*
Engine Class
Class HI
Class IV
Class V
Model Year
2002
238
196
(Phi)
2003
175
148
(Phi)
2004
113
99
143
2005
50
50
119
2006
50
50
96
2007+
50
50
72
* - The finalized standards are based on a 25, 50, 75, and 100 percent phase-in of
50 g/kW-hr standard for Class IE and IV, and 72 g/kW-hr for Class V.
26
Small volume engine manufacturers and small volume engine families have until
three years after the last date of the phase-in to comply with the Phase 2 standards.
This means 2008 for Classes IE and IV and 2010 for Class V.
49
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Chapter 3: Technologies and Standards
Chapter 3 References
1. "Cost Study for Phase Two Small Engine Emission Regulations", Draft Final
Report, ICF Consulting Group and Engine, Fuel, and Emissions Engineering, Inc.
Oct. 1996, Docket Item IV-A-01.
2. "The Basic Design of Two-Stroke Engines", Gordan P. Blair, Society of
Automotive Engineers, Inc., 1990.
3. "The Internal Combustion Engine in Theory and Practice, Volume 1", C.F. Taylor,
The M.I.T. Press, 1985. See Chapter 12, The Performance of Unsupercharged
Engines'
4. "Exhaust Systems Subgroup of the Technology Task Group - Report", September
25, 1995. Available in Docket Item II-D-17.
5. "WrittenTestimony of the Manufacturers of Emission Controls Association on
Proposed Phase 2 Emission Standards for New Nonroad Spark-Ignition Engines
at or Below 19 Kilowatts", March 13, 1998, Docket Item IV-D-13.
6. Letter from Bruce Bertelsen of MECA to Bob Larson of the EPA, October 19,
1998, Docket Item IV-G-25.
7. "Final Test Report: Emission Testing program for Handheld Engine Technologies
for the Reproposed Phase 2 Regulations", October 1999, Docket Item VI-A-01.
8. California ARE Certification Data as of January 2000 (see Appendix D).
9. "Technical Summary and Report Spark-Ignition Device Research", Pyrotek, Inc.,
November 13, 1998, Docket Item IV-G-29.
10. Technical Report No. 4 to Norman Garrett and Todd Arey, Pyrotek by Giles
Brereton, November 10, 1999 , Docket ItemVI- G-39.
11. Letter from Steven Todd Arey of Pyrotek to Robert Larson of the EPA, January
11, 2000, Docket Item VI-G-39.
50
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Chapter 4: Technology Market Mix and Cost Estimates
Chapter 4: Technology Market Mix and Cost Estimates
This chapter analyzes the variable costs and fixed costs per engine family modified in
each class. These are costs to the manufacturer. This chapter also presents a "schedule" for how
these engine modifications would be phased-in. The focus of this chapter is on engines in
Classes ni-V and not Class I-A or Class I-B. This is due to the fact that Class I-A engines (Occ-
65cc) are the same as the handheld engines, mentioned herein, that are used in nonhandheld
applications. Also, the Class I-B engine standard (65cc-100cc) is achievable with existing Class
I Phase 1 certified engines.
The Clean Air Act at section 213(a)(3) requires that EPA must consider cost in
establishing standards that achieve the greatest degree of emission reduction. This Chapter
presents the Agency's estimation of costs for expected technologies including associated variable
costs (hardware and production), fixed costs (production and research and development), related
equipment costs, engine fuel savings and engine compliance costs. Details of the methodology
for determining the compliance costs are presented in Chapter 5.
To calculate estimated costs incurred by engine manufacturers, market mix27 percentage
estimates for pre-Phase 2 (Phase 1) and Phase 2 engines must first be assessed. This is done by
determining the Phase 1 engine market mix from estimates provided by manufacturers as part of
their 1998 model year certification applications. Analysis of this data formed the assumed
product mix that will be in place as a result of the Phase 1 rulemaking. A comparison was then
made to the assumed product mix (including technical enhancements) that would need to be in
place to meet the Phase 2 standards. A description of the methodologies and resultant market
mixes for these estimates are described in section 4.1., entitled "Engine Technology Market Mix
Estimates."
Several of the emission reduction technologies assumed feasible for this rule include
changes in manufacturer production, such as changes in the cylinder die designs and the number
of tools. The following definitions were utilized to separate costs for emission reduction
technologies into variable hardware, variable production, fixed production and fixed research and
development. Variable hardware costs are those costs which are associated with pieces of
hardware added to an engine. Examples include rocker arms and push rods that are added to an
engine that is converted from two-stroke to four-stroke OHV. Variable production costs are
those costs which relate to inputs in production. These costs consist of additional production
tasks, such as assemblers for additional components for a four-stroke line which were not in
place for assembly of a two-stroke line. Variable hardware and production costs are determined
by estimating variable costs for each emission reduction technology and applying those costs to
27 Market mix is the percentage of engines of specific engine design sold in the
marketplace (e.g., four-stroke and two-stroke) compared to others in the same
engine class.
51
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Chapter 4: Technology Market Mix and Cost Estimates
that portion of the Phase 2 product mix assumed to have required that technical change. The
methodology for estimating variable hardware and production costs for applying emission control
technology are presented in section 4.2., entitled "Variable Hardware and Production Cost
Estimates per Engine Class."
Fixed production costs are those costs which are related to added or modified piece(s) of
machinery to an existing engine line due to this final rule, such as tooling and die design changes.
Fixed costs of research and development are those costs associated with development of engine
and engine component designs to meet emission standards. These costs are incurred prior to
production and amortized for recovery over 5 years and therefore do not apply on a per engine
basis as do variable cost estimates. Discussion of the methodology utilized to estimate fixed
costs is presented in section 4.3., entitled "Fixed Production and Research and Development Cost
Estimates per Engine Class."
Engines are utilized in equipment which may require alterations due to changes in the
engines that would be required to meet the Phase 2 finalized standards. A discussion of
equipment impacts is presented in section 4.4., entitled "Equipment Cost Estimates." Lastly,
Section 4.5. details fuel savings and changes in power expected with the Phase 2 engine
technologies. Cost impacts from changes in maintenance, engine durability and life expectancy
were not quantified or included in this cost analysis. These factors are expected to remain the
same as in current product for consumer applications due to the concept that consumers take a
long time to use the life of the product and once reached will purchase another equipment rather
than have it repaired. While some directional changes regarding maintenance, etc. are
anticipated and noted in the following sections, the impact on cost to the manufacturer and
consumer will be slight and is considered insignificant and not quantified in this cost analysis.
4.1 Engine Technology Market Mix Estimates
Market mix estimates consist of the number of engine families and sales estimates of
engine designs (i.e., two-stroke, four-stroke) per class (i.e., Classes in through V). Market mixes
are determined for the 1998 model year (to characterize technology under the Phase 1 regulation)
and the first year of full implementation of the Phase 2 emissions regulation. The following
describes the methodology used to estimate market mix and emission reduction technologies for
Small SI engines. This analysis includes those engine families and base production volumes
certified to EPA's Phase 1 standard as of September 1998. A summary of results are in Tables
4-01 to 4-04 with manufacturer specific details and emission data in Appendix B.
4.1.1 Phase 1 Market Mix
The most accurate and up-to-date information source on engine families and
manufacturers in the marketplace today is the EPA Phase 1 engine certification list. The list, as
of September 1998, was utilized to estimate the number of engine families per engine design and
52
-------
Chapter 4: Technology Market Mix and Cost Estimates
technology for Classes HI through V28 as shown in Table 4-01. (Table B-01 in Appendix B
contains breakout per manufacturer.) Table 4-02 summarizes the sales in each engine class per
engine design.
Table 4-01
Phase 1 Technology Mix
Engine Families per Technology Type
Engine
Class
m
IV
V
Total
Two- stroke
9
116
50
175
Two- stroke
w/cat
—
2
—
2
Mini
four- stroke
—
O
O
6
Total
9
121
53
183
Table 4-02
Assumed Phase 1 Sales per Class and Technology Type
(Source: EPA Phase 1 Certification Database as of September 1, 1998)
Engine
Class
m
IV*
v*
Total
Two-stroke
1,287,500
8,250,728
501,570
10,039,798
Two- stroke
w/cat
—
conf
(included in
two-stroke)
—
some
Mini
four- stroke
—
conf
(included in
two-stroke)
conf
(included in
two-stroke)
some
Total
1,287,500
8,250,728
501,570
10,039,798
* - For Classes IV and V, some of the blocks state "conf." This is done to honor the manufacturer's claim
of confidentiality if only one or two companies contribute to the total number of engines in that block.
There are special cases in which engines do not have to meet the Phase 1 standards. These
include engines utilized solely in wintertime equipment, such as ice augers, that only have to meet
the CO standard.
53
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Chapter 4: Technology Market Mix and Cost Estimates
4.1.2 Phase 2 Market Mix
To determine the Phase 2 market mix, the need for emission reduction technologies was
determined by viewing the Phase 1 certification emission data (using Sept 1998 Phase 1
certification database). Based on comparison of the emission levels of engine in the Phase 1
database and the stringency of the Phase 2 standards, even with the use of ABT, it is assumed
that all engine families will need to be improved except 4-stroke designs. The likely
technologies were assumed (see Table 4-04) and the percentage usages of such technologies were
estimated through EPA's knowledge of technologies that manufacturers had on the marketplace
or were developing. If no information was known, then the compression wave technology was
assumed for it is currently seen as the most applicable technology to the wide range of engine
families.
4.1.2.1. Potential Emission Reduction Technologies - Potential emission reduction
technologies were based on information provided in discussions with a number of industry
manufacturers and independent companies. As of January 2000, a number of technologies have
been certified to meet the California ARB's 72 g/kW-hr HC+NOx standard. At least three
engine/equipment manufacturers have certified a mini four-stroke engine (Ryobi, Honda and
Robin America). Komatsu Zenoah has certified engines using stratified scavenging with lean
combustion engine. John Deere has certified their LE technology engine using compression wave
technology. Other low emitting technologies, such as two-stroke engine redesign with a catalyst,
have also been certified for the California market as of January 2000. However, such redesigned
engines with catalysts may not be able to meet EPA's more stringent final Phase 2 standards
unless the engines are further redesigned for lower emissions or a higher conversion efficiency
catalyst is used, or some combination of these two technology options. Currently known
technologies that are being used to meet the California ARE 2000 model year standards are
presented in Table 4-03.
Table 4-03
Emission Reduction Technologies Certified with the California ARB
Engine Technology
Two-stroke
four-stroke
Technologies for the California ARB
- four-stroke engine design
- Compression Wave Technologies (e.g., John Deere LE engine)
- Stratified scavenging with lean combustion
- Improved two-stroke with catalyst
-Leaner calibration and improved engine cooling
-Improved carburetor with more precise intake mixture control
-Improved combustion chamber design to promote more complete
combustion (more spherical and squish area)
-Improved transfer port design to reduce scavenging losses
-Higher manufacturing quality with reduced assembly tolerances and
component variation
-Optimization for a single engine operating point
- No changes needed
54
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Chapter 4: Technology Market Mix and Cost Estimates
For EPA's final Phase 2 HC+NOx standards of 50 g/kW-hr for Class IE and IV, and
72 g/kW-hr for Class V,29 EPA assumes the following technologies will be utilized. For Class HI
and IV we assumed mini overhead valve four-stroke, stratified scavenged with lean combustion
with a catalyst, compression wave engine technology, and compression wave technology with a
catalyst. For Class V we assumed stratified scavenged with lean combustion, and compression
wave engine technology. Improved two-stroke engines with a higher efficiency catalyst is also
being used in California and may also be used to meet federal standards especially in applications
such as back pack blowers and string trimmers where catalyst cooling and shielding are easiest.
In such cases, this technology may be preferable to some manufacturers if this represents a lower
cost option and requires less development resources prior to implementation. However more
development is required to meet the finalized emission standards and, as a simplifying
assumption for this cost analysis, improved 2-stroke with catalyst will not be considered for the
final cost impact analysis..30 A list of technologies used in this analysis are listed in Table 4-04.
The table also includes technologies for Class I-A and I-B which are included in this rulemaking.
Table 4-04
Assumed Technology Improvements Available to Manufacturers
Engine Engine
Class Design
I-A, two-stroke or
four-stroke
I-B four-stroke
SV and OHV
HI and two-stroke
IV
IV four-stroke
V two-stroke
Assumed Technologies
-Same technologies as assumed for Classes in through V
-Current technologies
-Four-stroke OHV
-Compression Wave Technology,
-Stratified Scavenging with Lean
with and without a catalyst
Combustion with a catalyst
-No changes
-Compression Wave Technology
-Stratified Scavenging with Lean
Combustion
29
30
It should be noted that while these engine technologies are focused on reducing
HC+NOx emissions, it is expected that CO emissions will decrease due to further
enleanment of the engines due to internal engine improvements made to decrease
HC+NOx.
Manufacturers may incorporate such improvements on some engines families and
thereby need less credits from other lower emitting engine families.
55
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Chapter 4: Technology Market Mix and Cost Estimates
4.1.2.2 Extent of Use of Emission Improvement Technologies — The standards for
handheld engines are phased-in over several years (2002 to 2005 for Classes in and IV and 2004
to 2007 for Class V) with the average in-use standard decreasing each year. ABT is available to
these classes and across all classes31. Small-volume engine families in Classes HI and IV and
small-volume manufacturers with these engine families have until 2008 to certify. Small-volume
engine families and manufacturers of Class V engines have until 2010 to certify. This cost
analysis assumes manufacturers use these cost-saving flexibilities.
To determine the number of engine families and corresponding production volume that
would need to incorporate emission or emission durability improvements, we examined the
certification database for emissions and sales characteristics of each engine family.32'33 Based on
the high emission characteristics of nearly every engine family and the stringency of the standard,
it was determined that all engine families would require improvements with the exception of
those which are wintertime only products, such as ice augers. The percentage of engines phased
in was determined from the declining emission standard (25%, 50%, 75% and 100%). While
several engine manufacturers have single engine families which are very high volume, it is
assumed that competition in the marketplace, especially for consumer priced products, will
require that the Phase 1 versions of the engines will be produced at the same time as their
cleaner, slightly more expensive Phase 2 counterpart.
Table 4-05 shows the assumed engine family phase-in for all handheld classes and Class
I-B. Table 4-06 shows the resultant engine production that are represented by the number of
engine families in Table 4-05. Handheld engine families meet the standards with conversion to
mini four-stroke design, stratified scavenging with a catalyst, and compression wave technology
with and without a catalyst. We have made our best assumptions with regard to which
technologies manufacturers will use based on input from individual manufacturers. For those
manufacturers where we did not have input, we have assumed they will use a technology which
costs the same as the compression wave technology (including payment of the full licensing costs
as proposed by John Deere). Table 4-07 presents the resulting market mix used in the cost
analysis for the Phase 2 standards.
31 Engine families will need to certify with FEL's of 72 g/kW-hr or below in order to
carry credits forward to future years.
32 The database contains several entries per engine family as manufacturers show
that the engine family meets the emission standard among its adjustable
parameters (particularly the carburetor). For such engine families, the maximum
emission rate for HC+NOx was utilized in setting the point at which the engine
family emitted for Phase 1.
33 Refer to Tables B-02 through B-06 in Appendix B for specific emission data for
each engine manufacturer and each of their engine families.
56
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Chapter 4: Technology Market Mix and Cost Estimates
Table 4-05
Assumed Phase-In Schedule of Handheld and Class I-B Engine Family Changes
(Number of Engine Families)
Engine
Class
III
IV
V
I-B
2002
1
21
-
4
2003
0
5
~
~
2004
1
33
o
J
-
2005
4
13
7
~
2006
-
-
3
-
2007
~
~
10
~
2008
3*
49*
-
-
2009
~
~
~
~
2010
-
-
30*
-
* - These families represent small-volume engine families/manufacturers which have three years of
additional flexibility at the end of the phase in.
Table 4-06
Production Volume (and Percent of Total per Class)
Represented by Engine Families
Engine
Class
III
IV
V
Specific Technology Change
Assumed for this Analysis
Compression wave technology
with catalyst, Stratified
scavenge with catalyst
Mini four-stroke, Compression
wave technology with and
without catalyst, Stratified
scavenge with catalyst
Compression wave technology
Upon Full Implementation
(Based on 1998 Sales Estimates)
# of Engines
1,258,500
8,250,728
501,570
% Within Class
100%
100%
100%
57
-------
Chapter 4: Technology Market Mix and Cost Estimates
Table 4-07
Phase 2 Technology Mix (Upon Full Implementation)
Engine Families Per Technology Type Assumed for Cost Analysis
Engine
Class
III
IV
V
Total
Mini
four-stroke
-
7
3
10
Two-stroke with compression wave
(Class III - with catalyst,
Class IV - with and without catalyst,
Class V - without catalyst)
9
90**
50
149
Two-stroke with
stratified scavenge
(with catalyst)
~
24
~
24
Total*
9
121
53
183
* - This analysis assumes the same number of engine families before and after Phase 2. There is the
possibility that some engine families may be dropped or some may be combined in order to reduce costs.
Also, one manufacturer has exited the marketplace since September 1998. Their engine families have been
removed. However, their sales have been included in the class total production estimates used in this
analysis.
** - We analyzed two scenarios with regard to catalyst usage on the compression wave technology. In the first
scenario we assumed, based on input from John Deere, that they would use catalysts on 50% of the Class
IV engines. In the second scenario we assumed that all manufacturers of Class IV engines using the
compression wave technology would use catalysts on only 50% of the engines.
Table 4-08
Assumed Phase 2 Sales per Class and Technology Type*
(Based on Phase 1 Database as of September 1998)
Engine
Class
III
IV
V
Total
Mini
four-
stroke
-
1,500,000
-
1,500,000
Two-stroke with compression wave
(Class III - with catalyst,
Class IV - with and without
catalyst, Class V - without catalyst)
1,287,500
5,750,728**
501,570
7,539,798
Two-stroke with
stratified scavenge
(with catalyst)
~
1,000,000
~
1,000,000
Total
1,287,500
8,250,728
501,570
10,039,798
** .
Baseline sales without projected growth
We analyzed two scenarios with regard to catalyst usage on the compression wave technology. In the first
scenario we assumed, based on input from John Deere, that they would use catalysts on 50% of the Class
IV engines. In the second scenario we assumed that all manufacturers of Class IV engines using the
compression wave technology would use catalysts on only 50% of the engines.
58
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Chapter 4: Technology Market Mix and Cost Estimates
4.2 Variable Hardware and Production Cost Estimates per Engine Class
EPA developed cost estimates for variable hardware and production costs for Phase 2
engines. The cost estimates were taken based on information from engine manufacturers,
information from a catalyst manufacturer association, and the cost report from ICF and EF&EE
(Ref. la). Table 4-09 contains the variable hardware cost and production cost for each emission
reduction technology per class and engine design on which this cost analysis is based. The costs
listed in Table 4-09 are based on information presented in Chapter 3 for the different
technologies. The final variable hardware and production estimates, used in the cost-
effectiveness calculation for Class HI, through V engines, are listed in Appendix E (Table E-02)
and are based on the numbers presented in Table 4-09. The value chosen from the range of cost
estimates is influenced by the estimated sales production per engine family (from the Phase 1
September 1998 certification database) and assumptions about the likelihood of the latest cost
estimates based on development of the technology from discussions with engine manufacturers,
for example John Deere who is developing the Compression Wave technology. Since
California's standards go into effect in year 2000, a minimum of 2 years prior to federal
standards, costs incurred developing technology for California which can be used in meeting
these federal standards is not included except to the extent required to represent expanded
production or additional applications.
For the long-term, there are factors that EPA believes are likely to reduce the costs to
manufacturers. As noted above, we project fixed costs to be recovered by manufacturers during
the first five years of production, after which they would expire. For variable costs, research in
the costs of manufacturing has shown that as manufacturers gain experience in production, they
are able to lower the per-unit cost of production. These effects are often described as the
manufacturing learning curve which has been used by EPA in previous rulemaking to account for
reductions in manufacturing cost for new engine/emission control system technologies. For a
detailed description of how EPA has used learning curves in the past, and for why they are an
appropriate tool for estimating emission control costs, refer to the Tier 2 RIA34
The learning curve is a well documented phenomenon dating back to the 1930s. The
general concept is that unit costs decrease as cumulative production increases. Learning curves
are often characterized in terms of a progress ratio, where each doubling of cumulative
production leads to a reduction in unit cost to a percentage "p" of its former value (referred to as
a "p cycle"). The organizational learning which brings about a reduction in total cost is caused
by improvements in several areas. Areas involving direct labor and material are usually the
source of the greatest savings. Examples include, but are not limited to, a reduction in the
number or complexity of component parts, improved component production, improved assembly
speed and processes, reduced error rates, and improved manufacturing process. These all result
in higher overall production, less scrappage of materials and products, and better overall quality.
34 See the Regulatory Impact Analysis for the Tier 2 Final Rulemaking, Chapter V, Air
Docket A-97-10.
59
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Chapter 4: Technology Market Mix and Cost Estimates
As each successive p cycle takes longer to complete, production proficiency generally reaches a
relatively stable plateau, beyond which increased production does not necessarily lead to
markedly decreased costs.
Companies and industry sectors learn differently. In a 1984 publication, Button and
Thomas reviewed the progress ratios for 108 manufactured items from 22 separate field studies
representing a variety of products and services(Ref 1). The distribution of these progress ratios
is shown in Figure 4-1. Except for one company that saw increasing costs as production
continued, every study showed cost savings of at least five percent for every doubling of
production volume. The average progress ratio for the whole data set falls between 81 and 82
percent. Other studies (Alchian 1963, Argote and Epple 1990, Benkard 1999) appear to support
the commonly used p value of 80 percent, i.e., each doubling of cumulative production reduces
the former cost level by 20 percent.
The learning curve is not the same in all industries. For example, the effect of the
learning curve seems to be less in the chemical industry and the nuclear power industry where a
doubling of cumulative output is associated with 11% decrease in cost (Lieberman 1984,
Zimmerman 1982). The effect of learning is more difficult to decipher in the computer chip
industry (Gruber 1992).
60
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Chapter 4: Technology Market Mix and Cost Estimates
15
10
0)
3
D"
CD
0
Distribution of Progress Ratios
i i i
55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 101 103 105 107
Progress Ratio
From 22 field studies (n = 108).
Figure 4-1. Distribution of Progress Ratios
(Button and Thomas, 1984)
61
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Chapter 4: Technology Market Mix and Cost Estimates
The learning curve discount accounts for improvements in technology design and
production processes that will likely occur over time as manufacturers work to develop the
technology, or develop new technologies, over their product line and reduce costs for competitive
reasons. We believe this learning curve impact on variable costs is especially appropriate with
respect to handheld equipment, most of which is sold for residential use, since the engines
manufacturers have emphasized the importance of cost competitiveness for this market.
Considering that these emission standards will cause substantial redesign of all two-stroke engines
and, for the first time the wide spread use of catalyst, it is reasonable to anticipate opportunity for
continued improvement in design and production of these new engine designs within the first few
years of their introduction.
We applied a p value of 80 percent in this analysis beginning in the first full year of
implementation of the final standards (2005 for Classes in and IV and 2007 for Class V).
Arguably, the learning should start with initial production, that is 2002 for Classes HI and IV and
2004 for Class V. By delaying the start of this learning curve application, we effectively increase
the cost estimate for this rule and raise the cost - effectiveness estimates. Using one year as the
base unit of production, the first time the cumulative production would double would occur at the
start of the third model year of production - 2007 for Classes HI and IV and 2009 for Class V; at
that time we assume the variable costs of production are reduced by 20 percent. Beyond that time,
we did not incorporate further cost reductions due to the learning curve. This is a conservative
assumption especially when we consider how much change in engine and emission control system
design is expected. This conservative assumption effectively raises the estimated cost and
therefore raising our cost - effectiveness estimate. Since the technology is evolving so rapidly, we
are less certain how learning curves will impact production costs in the longer term and therefore
are making no explicit assumption.
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One change has been made since the July 1999 SNPRM was published and that is the
estimated cost for catalysts and related components. Based on comments received, this cost
analysis is estimating a sales weighted catalyst cost in Class II and IV which reflects the high and
low volume catalyzed substrate costs provided by MECA and packaging costs as estimated by
ICF. Since we do no know the mix of large and small volume families the industry will elect to
certify equipped with a catalyst in a specific year of the phase in of standards, we have assumed a
sales-weighted cost based upon the current engine family sales distribution in Class in and IV.
This average cost is $6.15 for Class HI and $7.29 for class IV. Class V is assumed to not require
the use of catalysts based on the stringency of the standard and the likely capabilities of
developing technologies such as the compression wave and stratified scavenged with lean
combustion.
We note that the MECA cost estimates are based on the cost of a catalyst which reduces
the emissions of a 172 g/kW-hr engine by 60 % when new and 30% at the end of its useful life.
Such a catalyst is oversized and thus to some extent overpriced for Phase 2 engines which are
anticipated to have much lower engine out emission levels. However, we have insufficient
information to appropriately lower these catalyst costs to account for the lower engine out
emissions anticipated for typical Phase 2 engines. Further, this cost estimate is close to that
estimated by NERA for Class in and IV in comment to this SNPRM. Echo estimated $15 for
professional equipment but we believe this estimate is high and may reflect Echo's estimate based
upon current experience in California where some manufacturers are using catalysts on improved
but still relatively high emitting Phase 1 engines which would necessarily require a more robust
and expensive catalyst.
Table 4-09 provides an overview of the ranges of potential costs for the various
technology options considered for the cost effectiveness analysis performed for this final rule.
The costs included in Table 4-09 are first year costs and do not include the effect of the learning
curve discussed earlier. The cost of adding a catalyst system to a technology is based on a
weighting of the cost of large volume and small volume catalysts. Where a range in cost for
engine technologies is presented in Table 4-09, the range represents the estimated cost when
applied to a small volume family versus a large volume family. Licensing fees need to be added
for engines electing to use proprietary designs. We note that, within the uncertainty of this
analysis, manufacturers have a choice of cost competitive technology options.
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Table 4-09
Estimated Variable Hardware Costs (1998$) for Technology Changes to Two-stroke Engines
Engine
Class
III
IV
V
Specific Technology
Compression Wave
Technology with Catalyst
Four-stroke
Stratified scavenging
with lean combustion
with Catalyst
Compression Wave
Technology
Compression Wave
Technology with Catalyst
Compression Wave
Technology
Hardware Variable
($)
($4.00 to $7.50*)
+ $6.15
~
$8.50
+ $8.35
$4.00 to $7.50*
($4.00 to $7.50*)
+ $6.92
$4.00 to $7.50*
Production
Variable ($)
$1.11
-
$1.22
$1.11
$1.11
$0.50
Total Variable ($)
$11. 26 to $14.76
+ licensing fee**
$10.00 to $15.00***
$18.07
$5. 11 to $8.61 +
licensing fee**
$12.03 to $15.52 +
licensing fee**
$5.50 to $8.00 +
licensing fee**
Sources: (See Chapter 3) Engine manufacturers, MECA, and 1996 ICF Cost Study (Ref. 1). Costs from the 1996
ICF Cost Study were increased to 1998$ through use of GDP Implicit Price Deflators for 1996, 1997 and 1998 of
1.9%, 1.9% and 1.0% respectively.
* - For 500,000 and 10,000 annual production respectively.
** - It is not known whether John Deere will also pay a portion of this licensing fee to the originator of the
technology. Therefore, we analyzed two scenarios for this analysis. For the high-cost scenario we assumed
that John Deere pays the full fee. For the mid-cost scenario we assumed that John Deere pays no fee. In
both scenarios, all other manufacturers assumed to be using the compression wave technology were
assigned the cost of the full fee. The potential licensing fee for the stratified scavenge design is not known.
*** - Based on Ryobi's estimates for sales <1 million (the $15 figure) and >1 million (the $10 figure).
Costs that were not included in this variable cost analysis include any additional label
lettering, updated service manuals (writers, documentation) and seminars for dealers and training
for technicians. These costs are included in the fixed cost estimates below as they tend to
represent one time incremental expenditures due to the adoption of new technology.
Since we have only limited information on which technology option any specific
manufacturer will select, we have made the following assumptions for the purpose of estimating
the cost impact of this rule.
For John Deere equipment, we assume the compression wave technology will be used.
For licensing, our "high cost" scenario assumes John Deere pays the full licensing fee assumed for
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Chapter 4: Technology Market Mix and Cost Estimates
other manufacturers. For our "mid-cost" scenario, we assume John Deere will not pay a fee for
the use of this technology. Further we assume that John Deere's Class JJ engines will require
catalysts although with the availability of averaging across classes, this may not be necessarily
true. For Class IV engines, 50 % of the John Deere engines will require catalysts.
For manufacturers we know will be converting to 4-stroke technology, the 4-stroke
variable cost is added for those applications currently using 2-stroke engines. For manufacturers
currently producing 4-stroke engines, the same variable cost as applied for those switching from is
assumed. This simplifying assumption overstates costs for such manufacturers.
For manufacturers we anticipate to be converting to stratified scavenge engines, the
stratified scavenge variable cost is assumed. For manufacturers currently producing stratified
scavenge engines for national sale, we have assumed the stratified scavenge variable cost. This
simplifying assumption overstates costs for such manufacturers. Catalyst costs are added to all
anticipated stratified scavenge designs in Classes IV. No licensing fee is added.
For all other manufacturers, we do not know what technology they will use but are
assuming the costs of compression wave technology including the licensing fee proposed by John
Deere. Additionally, we assume catalyst costs for all Class HI engines. For Class IV engines, we
assume a "high-cost" scenario in which all these engines will require a catalyst. For the "mid-
cost" scenario, we assume these other manufacturers are just as technically capable as John Deere
and will similarly try to minimize costs; therefore only 50% of their Class IV engines will require
catalysts just as anticipated by John Deere.
4.3 Fixed Production and R&D Cost Estimates per Engine Class
Many of the technology changes that would be required to meet Phase 2 standards require
the manufacturer to expend capital on production and research and development. Production
costs include new tooling machines, molds, dies and other equipment needed to produce the
changed or additional parts; the costs of changing the production line to accommodate the changes
in the assembly process and in the size and number of parts; and the costs of updating parts lists.
Research and development (R&D) costs include engineering time and resources spent to
investigate emissions on current engines, and design and prototyping of engine design changes
and/or emission reduction technology. At the first sign of stringent regulations by the California
ARB, small engine manufacturers began research and development activities to address emission
reductions on a portion of their production. EPA has not removed any costs manufacturers may
have already incurred to meet California ARB's standards for 2000 and beyond except as
identified below. EPA's standards require new technologies compared to those required by the
California ARB's standards for some manufacturers and some applications. The research and
development costs for engines used in farm and construction applications that California does not
regulate (includes most Class V engines) still need to be applied to the federal rule. However, we
anticipate that all 4-stroke engines certified to meet California standards will meet EPA's
standards; no additional R&D expense will be required. Additionally, John Deere will have
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Chapter 4: Technology Market Mix and Cost Estimates
invested the vast majority of the R&D funds required to meet federal standards as a result of their
compression wave technology development to meet California standards; we assume additional
fixed cost of $50,000 per John Deere engine family to bring these California-certified designs into
compliance with federal standards, largely assure full production capacity. For Komatsu Zenoah
for their stratified scavenging technology, and other manufacturers whose technologies to meet
EPA's standards will be extensions of their technologies to meet the California standards, we have
assumed no fixed cost other than to expand production. These manufacturers of 2-stroke engines
in Classes in and IV being carried over from their California designs will need to invest R&D for
the addition of a catalyst. These catalyst-related cost are assumed. Also, while this cost analysis
assumes catalysts on all 2-stroke Class in engines, and many Class IV engines, with the
availability of the ABT program, it is expected that most likely some smaller sales volume engine
families can be marketed as designed to meet the current California 72 g/kW-hr HC+NOx
standards for Class HI and Class IV engines with their FELs above the 50 g/kW-hr HC+NOx EPA
standard averaged with credits generated on catalyst-equipped families with FELs below the EPA
standard. For these "California families" marketed nationwide, no additional R&D would be
required. However, as a simplifying assumption, we have not tried to account for the cost impact
of federal sale of these "California families."
Handheld Classes in through V are assumed to require fixed costs for research and
development and production for this cost analysis. As previously stated, the expected
technologies range from mini 4-stroke to stratified scavenged with lean combustion with catalysts
or compression wave technologies with catalysts. The fixed cost estimates for the technologies
presented in Table 4-10 were based on estimates contained in the ICF cost study35 for 4-stroke and
stratified scavenged technologies, and estimates made by John Deere (from Docket Item
IV-G-3036) for the compression wave technology. The costs from the ICF Cost study were
updated from 1996$ estimates to 1998$ estimated by multiplying by the GDP Implicit Price
Deflators for 1996, 1997 and 1998.
For the 4-stroke engines, we assessed cost on the basis of engine family production using
the ICF cost estimates for a 400,000 unit production family as appropriate for families over
200,000 units and ICF's cost estimates for a 90,000 unit production family as appropriate for
35 The ICF report lists cost estimates for two cases of different annual production.
The two cases are 400,000 units and 90,000 units. The EPA Phase 1 certification
database was used to estimate engine family production levels.
36 These estimates were completed in December 1998 and a good amount of
subsequent work has been completed during 1999 as John Deere brings this
design to market in California; therefore it is estimated that these cost estimates
will decrease (particularly for John Deere) as developed technology is transferred
to nationwide applications.
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Chapter 4: Technology Market Mix and Cost Estimates
families 200,000 units or under; this assumption considered the specific engine family production
volumes for the relatively few manufacturers anticipated to use 4-stroke technology.
Similarly for stratified scavenge families, we estimated costs on the basis of specific
engine family production estimates for the manufacturers anticipated to used this technology.
The compression wave technology fixed costs are estimated to, for the most part, be R&D
costs. While some tooling change will be necessary to, for example, drill ports in different
locations of the fuel metering system, the engine is still basically a 2-stroke design and production
line modifications should be minimal. While John Deere estimated no fixed production cost will
be necessary since they anticipate changing tooling as the existing tooling wears out, we are
allocating $25,000 fixed production cost per engine family to assure any impacts on fixed
production cost are adequately accounted.
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Chapter 4: Technology Market Mix and Cost Estimates
Table 4-10
Fixed Costs For Handheld Engine Families From the
ICF Cost Study and Docket Item IV-G-30 (updated to 1998$)*
Engine
Class
III and
IV
V
Engine
Design
Two-
stroke
Two-
stroke
Technology
Four-stroke (Class IV only)
Stratified scavenging with
lean combustion with
Catalyst
Compression Wave
Technology
Compression Wave
Technology with Catalyst
Stratified scavenging with
lean combustion
Compression Wave
Technology
Improved Scavenging and
Combustion Chamber
Design and Catalyst
Fixed
Production
$3,749,000
$493,000
$25,000**
$25,000**
$493,000
$25,000**
$147,000
Fixed
R&D
$577,000
$561,000
$50,000-
$250,000
$438,000-
$638,000
$173,000
$50,000-
$250,000
$357,000
Total Fixed
Costs*
$4,326,000
$1,054,000
$50,000-
$275,000
$438,000-
$663,000
$666,000
$50,000-
$275,000
$504,000
* - Converted to 1998$ through Use of GDP Implicit Price Deflators for 1996, 1997 and 1998
** .
While Docket Item IV-G-30 does not estimate any capital cost for production, anticipating tooling changes
as part of the normal replacement cycle, it is assumed there will be some for manufacturers adopting this
technology. We estimate $25,000 fixed production cost for each family of different displacement. John
Deere estimated $75,000 to $300,000 in R&D for each new engine family, representing high and low cost
estimates partly based on production volume. However, in developing its production to meet California
regulations, John Deere will have completed its initial development work. Information gained will be easily
transferable as it expands production and adjusts designs to meet federal regulations. For other
manufacturers, we reduced John Deere's "High" cost estimate of $300,000 for R&D by $50,000 to account
for the transfer to other manufacturers of the technology development completed by John Deere in bringing
its products to market. Further, John Deere's estimates tend to be high as they were made before its
products were fully developed and anticipated 100% implementation of federal standards in 2001, therefore
anticipating higher incremental expenses than will be necessary.
The fixed cost estimates to be applied to engine families in this rulemaking was
determined from the information in Table 4-10 and other considerations. The first of such
considerations is that the fixed cost estimates for stratified scavenging with lean combustion
engines was estimated by ICF before the current Komatsu Zenoah Air Head engine design was
available; anticipating that the design will be in production before the federal rules take effect
suggests that some of the development will be transferable and the development cost will be less.
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Chapter 4: Technology Market Mix and Cost Estimates
Second, estimates for the compression wave technology were developed in the preliminary
development stage of the technology and therefore anticipated the need for additional
development; much of the necessary development by John Deere will have taken place in bringing
this product to production for California and will be transferable to other manufacturers electing
to used this technology to meet federal standards. Third, manufacturers will also have invested
development resources in bringing catalyst equipped designs into production for California.37
Fourth, these estimates for Class V engine families may underestimate cost due to the more
extensive testing and evaluation performed on new technologies for professional equipment which
have longer useful lives and are used in a larger number of challenging applications including
chainsaws. Lastly, the September 1998 certification database is used as the basis for the number
of engine families to which fixed costs are applied. This would result in an overestimate of
expected costs if applied to all families since review of the certification database shows that there
are a number of engine families with the same displacements and differing applications.38 It is
very likely that once an engine family of a unique displacement has incorporated a technology that
only slight modifications are required to apply it to differing applications and therefore the full
development cost is not necessary. Based on these considerations, the (1998$) capital costs used
in the cost-effectiveness calculations are as listed in Table 4-11.
37 Equipment which incorporate low efficiency catalysts are currently in the
marketplace by Husqvarna. Additional use of catalyst is expected due to the
California ARB's Tier 2 standards for handheld engines taking effect in 2000.
38 It is also likely that several engine families are developed from a similar block
size and development costs can largely be spread across these families of various
displacement but based upon the same block. However, the details of this are
unknown at the time of this final rulemaking and therefore the assumption is
simplified to only engine families of the same displacement. This simplifying
assumption overestimates development costs.
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Chapter 4: Technology Market Mix and Cost Estimates
Ca
Table 4- 11
)ital Cost for Handheld Engines Used in the Cost-effectiveness Analysis (1998$)
Engine
Class
III
IV
V
Engine
Design
Two-
stroke
Two-
stroke
Two-
stroke
Technology
Compression Wave Technology
with Catalyst
Four-stroke
Stratified scavenging with lean
combustion with Catalyst
Compression Wave Technology
Compression Wave Technology
with Catalyst
Compression Wave Technology
Total Fixed Costs*
$463,000-$688,000
$4,351,000
$413,000-$691,000
$75,000-$300,000
$463,000-$688,000
$75,000-300,000
Converted to 1998$ through
include a one time fixed cost
Use of GDP Implicit Price Deflators for 1996, 1997 and 1998. These estimates
of $25,000 per engine family for updating manuals and training materials.
Engines in Class I-A already in production in the handheld classes, particularly mini four-
stroke engines, will not require any changes due to their new engine emission level and
deterioration compared to two-stroke engines. Engines in Class I-B are also assumed to need no
improvements.
4.4 Equipment Cost Estimates
Small engines are utilized in a wide variety of equipment from handheld trimmers to chain
saws, as described in Table 4-12.
Table 4-12
Common Equipment Types Per Class
Class HI
trimmers
Class IV
trimmers
chain saw
blower/vacuum
pump
augers
Class V
chain saw
augers
The wide variety of equipment designs, and the varying ease of designing equipment
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Chapter 4: Technology Market Mix and Cost Estimates
which use Small SI engines, presents a challenge when estimating costs for these classes of
engines. Thereby, the analyses have been performed on the most common equipment types for
each class as shown in Table 4-12. Data for the analysis is provided by the 1996 PSR OELINK
database(Ref. 2), the EPA Phase 1 certification database and the ICF cost study (Ref. 1). Results
from this analysis are shown in Table 4-13. These estimates are an average over all equipment
engine families, types and sales per class. The actual cost increase will depend on the equipment
application and flexibility of the original equipment design to incorporate a new engine.
It should be noted that this analysis has assumed the full cost of die replacement and this
likely results in overestimated costs. Changes to an equipment manufacturer's line (or
engine/equipment manufacturer's line since this industry is mostly vertically integrated) may be
made more economical with planning. For instance, the timing of new dies in relation to the
useful life of the existing dies can minimize an equipment manufacturer's costs. According to
ICF, typical equipment dies last 3-10 years and produce upwards of 250,000 units. Due to the fact
that there is substantial lead time for this rulemaking, it is expected that equipment manufacturers
will purchase new dies near or at the end of the useful life of their existing dies. However, such a
reasonable cost-minimization cost technique has not been incorporated in this cost analysis. Thus,
these cost estimates exceed the actual production line costs expected. The few equipment-only
manufacturers will have to work closely with engine manufacturers to ensure the availability of
engine designs in a reasonable time frame for equipment engineering requirements.
Estimates for equipment changes have been based on the estimated engine changes for
Classes HI through V engines. Handheld engines are expected to utilize technologies of mini
four-stroke, compression wave technology, compression wave technology with a catalyst, or
stratified scavenged with lean combustion engine with a catalyst. Specific strategies are assumed
for this analysis.39 At the time of this final rule, EPA does not have an available resource for
estimating the number of equipment models in the marketplace. Discussions with several engine
manufacturers reveals that the number of models are dependent on the marketplace desire for
different product from their competitors. For example, one engine may have a larger cc
displacement than another engine, although it is inherently the same engine with just a slightly
larger bore size, piston and rings. The EPA Phase 1 database is a source of engine manufacturers
39 Table E-05 contains the assumptions made in this analysis on the percentage of
engine families per technology. The assumptions are based on the assumed use of
four-stroke and stratified scavenging by manufacturers developing or likely to use
the technology and the compression wave technology was assumed to fill in the
remaining need. For these other manufacturers, in Class in it is assumed 100
percent of the engines will use compression wave with catalyst. For these other
manufacturers in Class IV, it is assumed all will use compression wave
technology with 50% also adding a catalyst. For Class V, it is assumed 100
percent of the engines will use compression wave.
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and a number of engine families. It is known that manufacturers engines are incorporated into a
number of equipment types. For this analysis, EPA assumed that there were two times the
number of equipment models as engine families. It is likely that this is an underestimation of the
number of equipment models. However, different equipment models offered within an engine
family often are quite similar in engine application (e.g., a shaft driven product) and can
incorporate the same engine mounting brackets, exhaust systems, heat shields, etc. Therefore,
assuming the full cost of equipment modification for two pieces of equipment per engine family is
a reasonable method to approximate the anticipate equipment modification costs across all
equipment offerings within an engine family. Further, handheld engine manufacturers also
normally manufacturer the equipment in which there engines are installed.. Thus they can
anticipate the change in engine design required to meet federal regulations and coordinate that
with changes in equipment design to minimize costs. For example, the engine manufacturers may
modify their dies during the time of die replacement which happens 1 or 2 times per year for large
volume equipment models. This is the practice John Deere assumed as good manufacturing
practice. (See Docket Item IV-G-30) Therefore the costs for this change would be minimum
engineering time. However, for engine families that are low volume, it is possible that the same
dies may be replaced before they are worn out. On the other hand, this may not be the case if the
low volume engine families are updated on a longer lead time as allowed in this rulemaking
phase-in.
As stated in the above paragraph, the majority of handheld equipment manufacturers make
the engines with the exception of a few companies, such as auger manufacturers. If the current
engines used by the auger manufacturers are not available upon Phase 2, then the auger
manufacturers may need to incorporate changes to the auger's transmission box in order to
accommodate modifications to the engine's speed-torque signature. EPA is aware of the number
of engine families needing to be updated based on discussions with auger manufacturers.
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Chapter 4: Technology Market Mix and Cost Estimates
Table 4-13
ICF Cost Estimates For Handheld Equipment Changes (Classes in through V)
Application
Four-stroke for chainsaws and
trimmers
Four-stroke for backpack blowers
and pumps
Redesigned, Stratified Scavenged
with Lean Combustion or
Compression Wave Technology
engine with a Catalyst
Redesigned, Stratified Scavenged
with Lean Combustion or
Compression Wave Technology
w/o cat
Ice and Earth Augers*
Fixed Costs
(per line)
$164,670
$77,189
$298,465
$30,876
$60,000
Variable
Hardware
(per unit)
$0
$0
$1.67
$0.00
$0
Variable
Production
(per unit)
$0
$0
$0
$0
$0
* - Based on 1996 ICF Cost Study and discussions with and comments from (January 1998
NPRM) auger manufacturers.
4.5 Fuel Savings and Impacts on Performance
Section 213(a)(3) of the 1990 Clean Air Act requires that EPA give appropriate
consideration to factors including energy, noise and safety associated with the application of
technologies estimated for this rulemaking. This section discusses EPA's assessment of the
effects of this rulemaking on energy (i.e., fuel economy) and power. Impacts on noise, safety and
maintenance can be found in Chapter 3.
4.5.1 Fuel Consumption
This rulemaking will result in fuel savings for the consumer. This is based on the
technologies to be applied on these engines to meet the Phase 2 standards as described below.
The tables contained in this section present the background data utilized for estimating the fuel
consumption per engine per class. These data were incorporated into the NONROAD model to
calculate the fuel savings per year for all equipment types given scrappage rates, growth, engine
power, engine load factor, residential or commercial usage and useful life. We assumed changes
in fuel consumption as engines age over time would be the same compared to existing engines.
Additional calculations for the expected reductions in fuel consumption and the resultant cost
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Chapter 4: Technology Market Mix and Cost Estimates
savings are presented in the Chapter 7 analysis of aggregate costs.
For two-stroke handheld engines in Classes HI through V, EPA estimates that the
technologies of mini four-stroke, stratified scavenging with lean combustion and compression
wave will result in a 30 percent decrease in fuel consumption. This is based on an estimate that
expected Phase 2 technology will reduce the approximate 30 percent of the fuel that exits the
engine unburned due to fuel scavenging and incorporate technologies that will result in improved
fuel combustion, thereby allowing the manufacturers to enlean the engine. Limited publicly
available test data, contained in Table 4-14, illustrates the basis for the expected fuel usage due to
Phase 2 technology.
Table 4-14
Fuel Consumption of Class IV Two-stroke Engines
(NOTE: weightings have been changed from 90/10 to 85/15)
Manufacturer
Husqvarna E-tech
John Deere LE
Prototype
Komatsu Zenoah
Stratified Scavenged
BSFC
fe/kWM
556
585
475
Reference
Testing at EPA
Testing at John Deere
Testing at EPA
The values listed in Tables 4-15 and 4-16 contain the fuel consumption values utilized to
estimate fuel savings for Phase 1 and Phase 2 engines, respectively, used in EPA's NONROAD
model. The Phase 1 fuel consumption levels contained in Table 4-15 were developed for EPA
Phase 1 rulemaking. The fuel consumption levels presented in Table 4-16 for Phase 2 engines
were determined by reducing the Phase 1 levels (in Table 4-14) by 30 percent.
Table 4-15
Phase 1 Fuel Consumption Estimates Per Engine Per Class (g/kWh)
Engine Class
m
IV
V
OHV
515
—
Two- stroke
720
720
529
Source: Small Engine Phase 1 RSD(Ref. 3)
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Chapter 4: Technology Market Mix and Cost Estimates
Table 4-16
Phase 2 Fuel Consumption Estimates Per Engine Per Class (g/kWh)
Engine Class
m
IV
V
OHV
515
—
Two- stroke
504
504
370
4.5.2 Power
The power from handheld engines redesigned to utilize compression wave technology is
not expected to change. Testing on developed prototypes by John Deere indicates this (se Docket
Item IV-G-30). While one engine prototype developed by John Deere did experience a significant
power loss (as noted by some commenters), this was a large chainsaw application using a
competitors product (John Deere currently does not make that large of an engine), was constructed
using an available but seriously undersized carburetor and was the result of only two weeks of
development effort. Therefore we believe that given the development time available in the rule,
such potential performance problems are solvable for all applications using compression wave
technology. For engines redesigned to use a stratified scavenged with lean combustion design, the
engine power would be expected to decrease minimally without a change in the engine size.
Current designs have up to a 7 % power loss. This is not significant for typical consumer
applications such as string trimmers or blowers as the engines used in such equipment usually
supplies much more than the necessary power. It is also possible that with additional
development, engineering solutions which minimize this power loss will be available for those
applications (such as commercial chain saws) which place demands on the engine closer to its
peak power capability. If that is not possible, in some cases engine manufacturers may choose to
increase the size of the engine to obtain similar power to Phase 1 engines. This can be done
without adding weight by boring out the cylinder, for example. This would require a change in
tooling which could be anticipated and incorporated in the normal tooling replacement cycle. Any
costs associated with the potential The need to increase engine size to maintain power cannot be
quantified at this time and the options available to the engine manufacturer are depend on the base
engine and the specific equipment needs. While these changes, especially as it may impact the
cost analysis for this rule are anticipated to be small at most, they have not been quantified.
4.5.3 Oil Consumption
With conversion to a four-stroke design which has a separate oil lubrication system
separate from the fuel system and with improvement in two-stroke combustion which reduces the
amount of fuel-oil mixture consumed, oil consumption will also decrease with a resultant decrease
in consumer cost. Since the cost of the oil currently used in 2-stroke engines is a small operating
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Chapter 4: Technology Market Mix and Cost Estimates
cost (engines typically operate with 50 parts gasoline to one part oil and the oil costs about $5 per
quart in residential quantities), the impact on this cost will also be small. However, this decrease
in oil consumption and oil cost has not been estimated.
4.5.4 Assumed Amortization Period
All fixed costs are amortized over 5 years. This is a simplifying assumption which
accelerates the cost allocation for certain new equipment required to be added by manufacturers to
meet these rules. For example, the addition of a new press machine might be required and would
appropriately be amortized over 10 years. This simplifying assumption, while easing calculations,
tends to overstate costs, especially for situations where significant new production hardware
would be required such as in changing from 2-stroke production to 4-stroke production.
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Chapter 4 References
la. ICF and Engine, Fuel and Emissions Engineering, Incorporated; "Cost Study For
Phase Two Small Engine Emission Regulations", Draft Final Report, October 25, 1996, Docket
Item IV-A-1.
1. J.M Dutton and A. Thomas, Academy of Management Review., Rev. 9, 235, 1984.
2. Power Systems Research, OELINK database, St. Paul, Minnesota, 1996.
3. US EPA, "Regulatory Impact Analysis and Regulatory Support Document Control of air
Pollution; Emission Standards for New Nonroad Spark-Ignition Engines At or Below 19
Kilowatts", May 1995, EPA Air Docket A-93-25, Docket Item V-B-1.
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Chapter 5: Compliance Program Costs
The Phase 1 rule is a "new engine certification only" rule in that the standards need only
be met after a short number of break-in hours (less than 12 hours) prior to production and SEA.
This Phase 2 regulation will bring the concepts of useful life and emission deterioration to the
emission regulation of handheld small spark ignited engines at or below 19kW. These program
elements will work to assure that actual production engines meet standards throughout their useful
lives.
The costs accounted for in this chapter are those costs that are above those required in
Phase 1. Appendix C contains the detailed cost spreadsheet results for each compliance program.
A summary of the cost results for each program per engine class and the overall cost methodology
is included at the end of this chapter. Reductions in costs for small-volume engine manufacturers
or small-volume engine families are accounted for in this analysis.
5.1 Background
General assumptions and cost estimates for the various compliance programs for handheld
engines are described herein.
5.1.1 Engine Families
The program costs are calculated on the number of engine families per class. This data is
taken from EPA's Phase 1 certification database as of September 1998 (Appendix C contains
nonconfidential database information). While a reliable source for engine families for the Phase 1
program, we expect that manufacturers may make changes during the years in which the Phase 2
program is in effect. However, it is difficult to predict these changes at this time. Consequently,
this analysis makes no assumption as to a different number of engine families from the Phase 1
database. The costs associated with record keeping requirements for each program is included in
the ICR's submitted with this rulemaking.
5.1.2 Assumed Costs
The number of break-in hours and the costs for bench age hours and emission testing for
this analysis are included in Table 5-01.
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Table 5-01
Common Costs Among Compliance Programs
Topic
Hours for break-in
Bench age ($/hour)
Emission test ($)
Estimate
4.2
$15.00
$300.00
Resource
Average from EPA Phase 1 certification
database for Classes ni-V.
EMA/OPEI NPRM Comments
EPA estimate from "Cost Study for
Phase Two Small Engine Emission
Regulations", ICF and EF&EE, October
25, 1996
(Ref 1) and other industry data.
5.2 Certification
The Phase 2 rule continues the fundamental certification program that began in Phase 1.
The most significant additional component to certification that affects all engines under Phase 2 is
the need to predict emissions for an engine family to its full useful life. This is done, for all
engine classes, through bench aging up to the chosen useful life hours. A deterioration factor
must also be established for the engine family to be used in conducting the Production Line
Testing program and therefore the engine must be tested two times. The first time is just after
break-in and the second is at the end of its useful life. Small-volume engine families and engine
families of small-volume manufacturers may utilize assigned deterioration factors(df) for the
specific engine design. However, this analysis assumes that manufacturers of small-volume
engine families and small-volume engine manufacturers bench age their engine families in order
to obtain an engine specific df since it is a one time cost and due to the impact on using a
potentially higher assigned df (based on the stringency of the standards).
5.2.1. Cost Inputs and Methodology— As stated previously, the number of engine
families chosen for the various useful lives was determined through examination of EPA's
Phase 1 certification database as of September 1998 and assumptions of each engine
manufacturer's market tendencies (see Table 5-02). We assume that the same number of engine
families certified today will be certified in the Phase 2 program.
We estimated the number of engine families certified to the individual useful life
categories. The basis of the estimation was the industry to which the manufacturer was known, be
it low cost consumer or high quality commercial. No split was made between engine families
within an engine manufacturer (in other words, assuming a portion was for consumer and a
portion was for commercial). For the 50-hour useful life category, we assigned those
manufacturers, and related engine families, geared toward the consumer market. For the 300-hour
useful life category, we considered those manufacturers, and related engine families, with ties to
the automotive market. Lastly, for the 125-hour useful life, we assumed the remaining engine
manufacturers and related engine families. For Class I-B engine families, we assumed the 125
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Chapter 5: Compliance Program Costs
useful life hour which is the first certification useful life hour category for nonhandheld engine
families.
The analysis assumes that certification occurs twice per engine family throughout the
phase-in of the Phase 2 standards. This is assumed due to the fact that the standards are average
standards for all classes and all engine families must be certified the first year to which they are
applicable, whether or not they are in their final Phase 2 configuration. We assume carryover for
certification will be used until the engines are updated for emission compliance at which time they
will be recertified. All families are included in the analysis based on the analysis, with ABT, of
engine manufacturers engine families which shows that the large majority of handheld engine
families will likely be updated due to the magnitude of difference in the emission standards from
Phase 1 to Phase 2.
Costs for the emission tests, break-in hours, and bench aging (on a dynamometer) are
listed in Table 5-01. (A summary of the total certification costs per year (2002 to 2011) per class
are listed in Table 5-04.) Certification costs are treated as fixed costs and are amortized at a rate
of 7 percent over 5 years.
Table 5-02
Number of Phase 1 Certification Families per Useful Life
Category Assumptions for Handheld Engine Classes and Class I-B
(Includes Small Volume Engine Families)
Engine
Class
m
IV
V
I-B
Useful Life Category
50
4
22
O
—
125
1
40
15
—
300
4
59
35
—
125
—
—
—
4
Engine families that may qualify for Class I-A may utilize the same data as qualification
for Classes in-V and therefore no costs are assumed for Class I-A engine families. For Class I-B,
the EPA 1998 certification database shows that there are three engine families that would qualify
for this class. We are aware of at least one engine family not yet certified, however the sales
production estimate is unknown.
5.3 Averaging, Banking and Trading
Averaging, banking and trading (ABT) will enable handheld manufacturers to comply with
the HC + NOx standard on a production-weighted average basis. By essentially allowing a
manufacturer to produce some engines that exceed the standards when it can generate or obtain
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Chapter 5: Compliance Program Costs
offsetting credits from engines that are below the standards, and the required emission level, the
ABT program will reduce the capital costs of complying with the Phase 2 standards.
Manufacturers will be able to distribute capital across engine families to obtain the most cost-
effective emission reductions, as long as the ABT calculation is acceptable to prove compliance to
the standards. The optional ABT program adds no costs to the certification process, but does
necessitate limited tracking of engines for credit accounting purposes. Related costs are addressed
in the certification ICR's for this program. While the ABT program is optional for all engine
manufacturers, this analysis assumes that all engine manufacturers will utilize this option. The
analyses also assumes that manufacturers will work to optimize the number of engine families that
will need to be improved to meet the emission standards in this rulemaking. Optimization is
achieved by choosing those engine families that have high emission rates and high production
volumes that will result in influencing the manufacturers' production weighted average the most.
5.4 Production Line Testing
5.4.1 Rationale for Production Line Testing
The certification process is performed on prototype engines selected to represent an engine
family. A certificate of conformity indicates that a manufacturer has demonstrated its ability to
design engines that are capable of meeting standards. Production line testing indicates whether a
manufacturer is able to translate those designs into actual mass production engines that meet
standards.
Manufacturer run Production Line Testing (Cum Sum) is a new program to the EPA
requirements for small engines. Therefore all of the costs are allocated to the Phase 2 program.
Note that engine manufacturers will be conducting quality audit testing for California's ARE and
therefore will likely utilize the same data for EPA's PLT program40. However, it is likely that
manufacturers do not sell all of their product line for use in California and therefore will incur
additional costs to test their whole product line. Since the estimated volume per engine family per
manufacturer sold in California is unknown, and likely varies amongst engine manufacturers, no
costs were subtracted for CARB quality audit testing.
5.4.2 Cost Inputs and Methodology
All engine manufacturers will conduct PLT and it is to be conducted on each engine
family certified to the standard each year. Therefore all Class in and Class IV engine families
except those eligible for the small volume flexibilities must be tested in the PLT program in 2002
and, similarly, Class V engines families in 2004. Testing will be performed on 2 to 30 engines. A
value of 7 tests per engine family are assumed for this analysis. PLT is performed on new
engines and therefore an initial engine break-in and emission test is required. Table 5-03 contains
the assumed engine family phase in schedule for the PLT program. Small engine families and
engine families from small volume manufacturers may not perform PLT. This analysis assumes
that PLT will not be performed on such families and therefore the small volume families are not
40 If the data are from 50 state engine families sold nationwide and if the test engines
are appropriately selected and tested.
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Chapter 5: Compliance Program Costs
included in Table 5-03.
All engine families would be required to be tested beginning with the first year of the
phase-in. The average break-in hours for each engine per class, emission test costs and break-in
costs were utilized in this analysis as described in Table 5-01. A summary of the PLT costs per
year (2002 through 2027 (Class IE and IV) and 2004 through 2027 for Class V) per class for the
requirements in this section are listed in Table 5-05.
Table 5-03
Assumed Engine Family Phase-In Per Class Per Year
Year
2002
2004
Class HI
6
—
Class IV
72
—
Class V
—
23
Class I-B
2*
—
PLT performed for each engine family, regardless if same engine certified with various
fuel specifications. PLT an option for small volume engine families.
*Number of engine families (not including small volume) taken from EPA Phase 1
certification database as of September 1998 (one additional Class I-B engine family is not
yet certified to Phase I, but will be certified to Phase 2)
5.5 Cost Summary Tables
The costs for each program were estimated in 1996, 1997 and 1998. The GDP Implicit
Price Deflator for 1996, 1997 and 1998 were used to bring all costs to 1998. Tables 5-04 to 5-05
present the estimated costs for the certification and PLT compliance programs, respectively, as
incurred through 2010. The total estimated compliance program costs, as incurred, are presented
in Table 5-06. The total estimated compliance program costs, as recovered, are presented in Table
5-07. The administrative costs for these programs are included in the ICR's for this final rule.
Chapter 7 determines the uniform annualized cost and cost per engine for this rulemaking
(with costs as recovered).
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Chapter 5: Compliance Program Costs
Table 5-04
Certification Costs Per Class Per Year As Incurred (1998$)
Calendar Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
Class HI
$3,860
$0
$1,368
$10,395
$0
$0
$15,353
$0
$0
Class IV
$77,843
$15,463
$108,878
$43,653
$0
$0
$185,883
$0
$0
Class V and Class I-B
$13,720
$0
$8,978
$30,573
$12,728
$43,300
$0
$0
$125.025
Table 5-05
Production Line Testing Costs As Incurred (1998$)
Calendar Year
2002
2003
2004
2005
2006
2007
2008
2009
2010+
Class IE
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15.614
Class IV
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187.366
Class V and Class I-B
$5,205
$5,205
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65.057
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Chapter 5: Compliance Program Costs
Table 5-06
Total Compliance Program Costs Per Class As Incurred (1998$)
Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
Class IE
$19,474
$15,614
$16,981
$25,959
$15,614
$15,614
$30,966
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
Class IV
$265,208
$202,828
$296,243
$231,018
$187,366
$187,366
$373,249
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
Class V and I-B
$18,925
$5,205
$74,035
$95,630
$77,785
$108,358
$65,057
$65,057
$190,083
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
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Chapter 5: Compliance Program Costs
Table 5-07
Total Compliance Program Costs Per Class As Recovered (1998$)
Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
Class IE
$16,555
$16,555
$16,889
$19,412
$19,412
$18,470
$22,215
$21,881
$19,358
$19,358
$19,358
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
$15,614
Class IV
$206,351
$210,122
$236,676
$247,323
$247,323
$228,338
$269,902
$243,347
$232,701
$232,701
$232,701
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
$187,366
Class V and I-B
$8,551
$8,551
$70,593
$78,050
$81,154
$88,368
$88,368
$86,178
$109,215
$106,111
$95,550
$95,550
$95,550
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
$65,057
- Certification costs are amortized at 7% over 5 years.
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Chapter 5: Compliance Program Costs
Chapter 5 References
1. ICF and Engine, Fuel and Emissions Engineering, Incorporated; "Cost Study For
Phase Two Small Engine Emission Regulations", Draft Final Report, October 25, 1996,
Docket Item IV-A-01.
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Chapter 6: Environmental Benefit
Chapter 6: Environmental Benefit
This chapter presents the methodology used to quantify the emission reduction benefits
that will be realized from the final Phase 2 HC+NOx emission standards for Small SI handheld
engines. Benefits, in terms of HC+NOx emission reductions, are presented in the form of
aggregate benefits for all three handheld engine classes combined. These benefits are estimated in
terms of future 50-state emission reductions from affected Small SI engines used in a variety of
handheld equipment types (engines subject to California regulations are estimated to meet the
California standard of 72 g/kW-hr prior to the implementation of federal regulations while other
engines are estimated to meet the federal Phase 1 emission regulations). Estimated benefits
illustrate the future effect of the final Phase 2 standards on the emission inventory. Air quality
benefits are discussed qualitatively for all pollutants.
Many of the detailed results discussed below are presented in separate tables included in
Appendix F. EPA has made some revisions to the NONROAD Model inputs since the SNPRM
was published in July 1999. The changes were made based on discussions with manufacturers
during the Phase U rulemaking process. The three sets of inputs that were impacted were (1)
residential/commercial population splits for two-stroke Chainsaws, Trimmers/Edgers/Brush
cutters, and Blowers/ Vacuums, (2) load factors and hence the "Median Life at Full Load" values
for the above-mentioned applications, and (3) "Median Life at Full Load" for Class V
Trimmers/Edgers/Brush Cutters. The following sections highlight areas where differences exist
between modeling performed for the July 1999 SNPRM and that for the final rulemaking.
For a complete description of EPA's NONROAD model, the reader is referred to the
technical reports and program documentation prepared by EPA in support of NONROAD model
development. Copies of the technical reports and model documentation are available at EPA's
web site for nonroad modeling (http:/www.epa.gov/omswww/nonrdmdl.htm).
6.1 Estimated Emissions Reductions
To estimate the average annual emissions at baseline (Phase 1), EPA calculated the tons
per year estimates based on revised Phase 1 emission factors. The in-use factors have now been
determined as a multiplicative rather than an additive (as was the case for the Phase 1 rulemaking)
function of new engine emission factors and a deterioration factor which is a function of engine
hours of use. As before, total emissions are calculated for each type of equipment using the
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Chapter 6: Environmental Benefit
equation :
MASS =N *HP
Where,
Ny = nationwide population of ith equipment type using engine j
Hp; j = average rated horsepower of engine j used in equipment type i
LOAD;= ratio (%) between average operational power output and rated power for the
ith equipment type
HOURS; = average annual hours of usage for the ith equipment type
EF;J = brake specific in-use emission rate (kilowatts/hr) for engine type j
used in equipment i
MASSy = annual nationwide emissions (grams) for the jth engine type used in
equipment i
For the benefits analysis described here, EPA performed separate calculations for the
major equipment categories, each one of which is equipped with one or more of seven different
engine types with average power ratings as displayed in Table F-01. Population and activity
information used to construct the inventories relied predominantly on data available in a
commercially available marketing research database that includes most types of nonroad
equipment (Ref. la). As noted above, EPA did update the load factor information in the
NONROAD model for the three largest handheld applications. The updated load factor
information was gathered by engine manufacturers (Ref. Ib) in support of their recommendation
for a slightly modified test cycle for the Phase 2 program. The updated load factor information is
presented in Table F-03.
6.1.1 Aggregate HC+NOx Reductions
The calculation of aggregate HC+ NOx reductions is described in this section. The
calculation takes into account U.S. population of Small SI handheld engine/equipment types,
excluding those engines regulated by the state of California, hours of use, average power rating
and related equipment scrappage rates as described below. Along with estimated values for
Phase I and Phase n in-use engine emission rates, EPA has determined nationwide annual
emissions under the baseline and controlled scenarios through calendar year 2027.
6.1.1.1 In-use Population -In order to estimate future emission totals, some
projections of future populations of Phase 1 and Phase 2 controlled engines are needed. The
NONROAD model has determined population estimates of nonroad equipment covered by the
now final standards using certain growth factors. For the base population estimates, the
NONROAD model uses the 1996 population estimates from the Power Systems Research (PSR)
PartsLink database. To check on PSR population estimates, the population for several high sales
applications (i.e.: trimmers, blowers and chainsaws) were checked, using historical sales data and
engine manufacturer production estimates from the EPA 1998 certification database, and were
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Chapter 6: Environmental Benefit
adjusted accordingly. As noted above, for this analysis, the population estimates were adjusted to
exclude engines that are covered by California's Small Off-Road regulations.
6.1.1.2 Growth Estimates - The NONROAD model projects future year (post-
base year) equipment populations by applying a growth rate to the base year equipment
population. The determination of the growth rate uses a methodology which is different from that
used for the Phase 1 rulemaking. For a detailed description of population growth in the various
categories of handheld equipment the reader is referred to a paper presented by EPA at the
AWMA Emission Inventory Conference, New Orleans, LA on 12/9/98 titled "Geographic
Allocation and Growth in EPA's Nonroad Emission Inventory Model."
However, it should be recognized that, while national growth is measured at the level of
the economy as a whole, growth in specific areas of the country is likely to vary from area to area
in response to the specific demographic and commercial trends in those areas. These effects
should be taken into account in estimating growth at the local level. Table F-02 in
Appendix F contains the estimated in-use populations for the major handheld equipment
populations in various years.
6.1.1.3 Scrappage- The NONROAD model uses a scrappage curve to determine
the proportion of equipment that has been scrapped as a function of equipment age. The default
scrappage curve used in the NONROAD model is based on a cumulative Normal Distribution
representing accumulated scrappage at various ages. The scrappage curve is scaled to the average
lifetime of the equipment such that half of the units sold in a given year are scrapped by the time
those units reach the average expected life and that all units are scrapped at twice the average life
expectancy. The median life of the different handheld equipment types are presented in Table F-
03 in Appendix F.
6.1.1.4 Emission Factors — For the Phase 2 scenario, the new engine emission
factor values were obtained by back-calculation, using (1) the final in-use emission factors
(Phase 2 standards) and (2) a multiplicative deterioration factor (DF). For the pre-control
(Phasel) scenario, in-use emission factors were determined using the same methodology. For
both scenarios, the deterioration factor as defined below was determined for HC and CO using the
ratio of maximum emission level and the new engine level. This value was then used to calculate
the coefficient 'A' in the deterioration factor equation below:
DF = 1 + Ax(Agefactor) for agefactor<1.0
= 1+A for agefactor>=1.0
For NOx, the deterioration factors were set to 1.0, resulting in an A value of zero. The exhaust
emission factors for HC, NOx and CO along with those for Fuel Consumption are displayed in
Table F-04 in Appendix F. The table also lists the value of the coefficient A, the slope of the
deterioration factor equation.
For a detailed explanation of the deterioration factor function, the reader is referred to EPA's
89
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Chapter 6: Environmental Benefit
technical report no. NR-011 , titled "Emission Deterioration Factors for the NONROAD
Emissions Model."
6.1.1.5 Emissions reductions— EPA calculated baseline emissions using in-use
emission factors for Phase 1. To obtain average annual emissions for engines controlled to the
levels that will be required to comply with EPA's final Phase2 emission standards , emissions
were recalculated using post-control activity and in-use Phase 2 emission factors (see Table F-04
in Appendix F).
Table F-05 in Appendix F presents total annual nationwide emissions from engines
addressed in this rule under both the baseline (Phase 1) and the controlled (Phase 2) scenario. The
nationwide emissions are shown graphically in Figure 6-01.
90
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Total
OJ
0)
CO
O
IrvertoyYear
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Chapter 6: Environmental Benefit
In Figure 6-01, the annual benefit of the regulation in terms of reduction in total exhaust
HC+NOx is indicated by the difference between the upper and lower curves. The area between
the curves represents the net benefit of the regulation during the time required for the nonroad
Small SI handheld engine and equipment fleet to completely turn over. The results indicate that
the Phase 2 standards represent on average a 70.5 percent reduction in annual HC+NOx
emissions from handheld engines compared to Phase 1 levels, by the year 2027.
In addition, the rule is expected to reduce Fuel Consumption in handheld engines by
approximately 30 percent from Phasel levels by year 2027. This will have a beneficial impact on
HC refueling losses as well.
6.2 Air Quality Benefits
This section describes the public health and welfare concerns associated with the
pollutants impacted by this rulemaking, including ozone, air toxics, and carbon monoxide. These
benefits are discussed qualitatively for all pollutants.
6.2.1 Ozone
Ground-level ozone, the main ingredient in smog, is formed by complex chemical
reactions of volatile organic compounds (VOC) and nitrogen oxides (NOx) in the presence of heat
and sunlight. Ozone forms readily in the lower atmosphere, usually during hot summer weather.
Volatile organic compounds (VOCs) are a broad group of compounds composed mainly of
hydrocarbons (HCs). Aldehydes, alcohols, and ethers are also present, but in small amounts.
VOCs are emitted from a variety of sources, including motor vehicles, chemical plants, refineries,
factories, consumer and commercial products, and other industrial sources. VOCs also are
emitted by natural sources such as vegetation. NOx is emitted largely from motor vehicles,
nonroad equipment, power plants, and other sources of combustion.
The science of ozone formation, transport, and accumulation is complex. Ground-level
ozone is produced and destroyed in a cyclical set of chemical reactions involving NOx, VOC,
heat, and sunlight.41 As a result, differences in NOx and VOC emissions and weather patterns
contribute to daily, seasonal, and yearly differences in ozone concentrations and differences from
city to city. Many of the chemical reactions that are part of the ozone-forming cycle are sensitive
to temperature and sunlight. When ambient temperatures and sunlight levels remain high for
several days and the air is relatively stagnant, ozone and its precursors can build up and produce
more ozone than typically would occur on a single high temperature day. Further complicating
matters, ozone also can be transported into an area from pollution sources found hundreds of
miles upwind, resulting in elevated ozone levels even in areas with low VOC or NOx emissions.
41 Carbon monoxide also participates in the production of ozone, albeit at a much slower
rate than most VOC and NOx compounds.
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Chapter 6: Environmental Benefit
Emissions of NOx and VOC are precursors to the formation of ozone in the lower
atmosphere. For example, small amounts of NOx enable ozone to form rapidly when VOC levels
are high, but ozone production is quickly limited by removal of the NOx. Under these conditions,
NOx reductions are highly effective in reducing ozone while VOC reductions have little effect.
Such conditions are called "NOx limited." Because the contribution of VOC emissions from
biogenic (natural) sources to local ambient ozone concentrations can be significant, even some
areas where man-made VOC emissions are low can be NOx limited.
When NOx levels are high and VOC levels relatively low, NOx forms inorganic nitrates
but little ozone. Such conditions are called "VOC limited." Under these conditions, VOC
reductions are effective in reducing ozone, but NOx reductions can actually increase local ozone.
The highest levels of ozone are produced when both VOC and NOx emissions are present in
significant quantities.
Rural areas are almost always NOx limited, due to the relatively large amounts of biogenic
VOC emissions in such areas. Urban areas can be either VOC or NOx limited, or a mixture of
both, in which ozone levels exhibit moderate sensitivity to changes in either pollutant.
Ozone concentrations in an area also can be lowered by the reaction of nitric oxide with
ozone, forming nitrogen dioxide (NO2); as the air moves downwind and the cycle continues, the
NO2 forms additional ozone. The importance of this reaction depends, in part, on the relative
concentrations of NOx, VOC, and ozone, all of which change with time and location.
Based on a large number of recent studies, EPA has identified several key health effects
caused when people are exposed to levels of ozone found today in many areas of the country (Ref
1, 2). Short-term exposures (1-3 hours) to high ambient ozone concentrations have been linked to
increased hospital admissions and emergency room visits for respiratory problems. For example,
studies conducted in the northeastern U.S. and Canada show that ozone air pollution is associated
with 10-20 percent of all of the summertime respiratory-related hospital admissions. Repeated
exposure to ozone can make people more susceptible to respiratory infection and lung
inflammation and can aggravate preexisting respiratory diseases, such as asthma. Prolonged
exposure to ozone can cause repeated inflammation of the lung, impairment of lung defense
mechanisms, and irreversible changes in lung structure, which could lead to premature aging of
the lungs and/or chronic respiratory illnesses such as emphysema, chronic bronchitis and chronic
asthma.
Children are most at risk from ozone exposure because they typically are active outside,
playing and exercising, during the summer when ozone levels are highest. For example, summer
camp studies in the eastern U.S. and southeastern Canada have reported significant reductions in
lung function in children who are active outdoors. Further, children are more at risk than adults
from ozone exposure because their respiratory systems are still developing. Adults who are
outdoors and moderately active during the summer months, such as construction workers and
other outdoor workers, also are among those most at risk. These individuals, as well as people
with respiratory illnesses such as asthma, especially asthmatic children, can experience reduced
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lung function and increased respiratory symptoms, such as chest pain and cough, when exposed to
relatively low ozone levels during periods of moderate exertion.
Evidence also exists of a possible relationship between daily increases in ozone levels and
increases in daily mortality levels. While the magnitude of this relationship is still too uncertain
to allow for direct quantification, the full body of evidence indicates a likely positive relationship
between ozone exposure and premature mortality.
In addition to human health effects, ozone adversely affects crop yield, vegetation and
forest growth, and the durability of materials. Because ground-level ozone interferes with the
ability of a plant to produce and store food, plants become more susceptible to disease, insect
attack, harsh weather and other environmental stresses. Ozone causes noticeable foliar damage in
many crops, trees, and ornamental plants (i.e., grass, flowers, shrubs, and trees) and causes
reduced growth in plants. Studies indicate that current ambient levels of ozone are responsible for
damage to forests and ecosystems (including habitat for native animal species). Ozone chemically
attacks elastomers (natural rubber and certain synthetic polymers), textile fibers and dyes, and, to
a lesser extent, paints. For example, elastomers become brittle and crack, and dyes fade after
exposure to ozone.
VOC emissions are detrimental not only for their role in forming ozone, but also for their
role as air toxics. Some VOCs emitted from motor vehicles are toxic compounds. At elevated
concentrations and exposures, human health effects from air toxics can range from respiratory
effects to cancer. Other health impacts include neurological, developmental and reproductive
effects. Section 6.2.2. contains more information about air toxics.
Besides their role as an ozone precursor, NOx emissions produce a wide variety of health
and welfare effects (Ref. 3, 4). These problems are caused in part by emissions of nitrogen oxides
from motor vehicles. Nitrogen dioxide can irritate the lungs and lower resistance to respiratory
infection (such as influenza). NOx emissions are an important precursor to acid rain and may
affect both terrestrial and aquatic ecosystems. Atmospheric deposition of nitrogen leads to excess
nutrient enrichment problems ("eutrophication") in the Chesapeake Bay and several nationally
important estuaries along the East and Gulf Coasts. Eutrophication can produce multiple adverse
effects on water quality and the aquatic environment, including increased algal blooms, excessive
phytoplankton growth, and low or no dissolved oxygen in bottom waters. Eutrophication also
reduces sunlight, causing losses in submerged aquatic vegetation critical for healthy estuarine
ecosystems. Deposition of nitrogen-containing compounds also affects terrestrial ecosystems.
Nitrogen fertilization can alter growth patterns and change the balance of species in an ecosystem.
In extreme cases, this process can result in nitrogen saturation when additions of nitrogen to soil
over time exceed the capacity of plants and microorganisms to utilize and retain the nitrogen.
Elevated levels of nitrates in drinking water pose significant health risks, especially to
infants. Studies have shown that a substantial rise in nitrogen levels in surface waters are highly
correlated with human-generated inputs of nitrogen in those watersheds (Ref. 5). These nitrogen
inputs are dominated by fertilizers and atmospheric deposition.
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Nitrogen dioxide and airborne nitrate also contribute to pollutant haze, which impairs
visibility and can reduce residential property values and the value placed on scenic views. Section
6.2.4. further describes information about visibility impairment and regional haze.
Nonroad sources contribute substantially to summertime VOC and NOx emissions and
winter CO emissions. The median contribution of total nonroad emissions to VOC and NOx
inventories in summer ranges from 7.4 to 12.6 percent for VOC and 14.5 to 17.3 percent for NOx,
depending on the area (Ref 6). The lawn and garden equipment category is a major contributor to
summertime VOC emissions, accounting for a median ranging from 2.4 to 4.7 percent of the total
VOC inventory in tons per summer day, depending on the area.
EPA expects that reducing NOx and HC emissions from small nonroad spark-ignition
engines will help mitigate the health and welfare effects of urban and regional tropospheric ozone
formation and transport.
6.2.2 Air Toxics
Hydrocarbons are made up of hundreds of different compounds, some of which like
benzene and 1,3-butadiene, are considered to be hazardous air pollutants. This section discusses
the health and welfare of these two toxics and the benefits expected by this rulemaking.
6.2.2.1. Benzene
Benzene is an aromatic hydrocarbon which is present as a gas in both exhaust and
evaporative emissions from motor vehicles. Benzene in the exhaust, expressed as a percentage of
total organic gases (TOG), varies depending on control technology (e.g., type of catalyst) and the
levels of benzene and aromatics in the fuel, but is generally about three to five percent. The
benzene fraction of evaporative emissions depends on control technology (i.e., fuel injector or
carburetor) and fuel composition (e.g., benzene level and Reid Vapor Pressure, or RVP) and is
generally about one percent.
The EPA has recently reconfirmed that benzene is a known human carcinogen by all
routes of exposure (Ref. 7). Respiration is the major source of human exposure. At least half of
this exposure is by way of gasoline vapors and automotive emissions (EPA 1998a). Long-term
exposure to high levels of benzene in air has been shown to cause cancer of the tissues that form
white blood cells. Among these are acute nonlymphocytic42 leukemia, chronic lymphocytic
42 Leukemia is a blood disease in which the white blood cells are abnormal in type or
number. Leukemia may be divided into nonlymphocytic (granulocytic) leukemias and
lymphocytic leukemias. Nonlymphocytic leukemia generally involves the types of white blood
cells (leukocytes) that are involved in engulfing, killing, and digesting bacteria and other
parasites (phagocytosis) as well as releasing chemicals involved in allergic and immune
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leukemia and possibly multiple myeloma (primary malignant tumors in the bone marrow),
although the evidence for the latter has decreased with more recent studies (Ref. 8,9). Leukemias,
lymphomas, and other tumor types have been observed in experimental animals that have been
exposed to benzene by inhalation or oral administration (EPA 1985, Clement 1991). Exposure to
benzene and/or its metabolites has also been linked with genetic changes in humans and animals
and increased proliferation of mouse bone marrow cells (Ref. 10,11). Furthermore, the
occurrence of certain chromosomal changes in individuals with known exposure to benzene may
serve as a marker for those at risk for contracting leukemia (Ref. 12).
The latest assessment by EPA places the excess risk of developing acute nonlymphocytic
leukemia at 2.2 x lO'6 to 7.7 x 10"6/|ig/m3 (EPA, 1998a). In other words, there is a risk of two to
eight excess acute nonlymphocytic leukemia cases in one million people exposed to 1 |ig/m3
benzene over a lifetime (70 years). These numbers represent the maximum likelihood (MLE)
estimate of risk, not an upper confidence limit (UCL).
A number of adverse noncancer health effects, blood disorders such as preleukemia and
aplastic anemia, have also been associated with low-dose, long-term exposure to benzene (EPA
1985, Clement 1991, Ref. 13). People with long-term exposure to benzene may experience
harmful effects on the blood-forming tissues, especially the bone marrow. These effects can
disrupt normal blood production and cause a decrease in important blood components, such as red
blood cells and blood platelets, leading to anemia (a reduction in the number of red blood cells),
leukopenia (a reduction in the number of white blood cells), or thrombocytopenia (a reduction in
the number of blood platelets, thus reducing the ability for blood to clot). Chronic inhalation
exposure to benzene in humans and animals results in pancytopenia43 ,a condition characterized
by decreased numbers of circulating erythrocytes (red blood cells), leukocytes (white blood cells),
and thrombocytes (blood platelets) (Ref. 14, 15). Individuals that develop pancytopenia and have
responses. This type of leukemia may also involve erythroblastic cell types (immature red blood
cells). Lymphocyte leukemia involves the lymphocyte type of white bloods cell that are
responsible for the immune responses. Both nonlymphocytic and lymphocytic leukemia may, in
turn, be separated into acute (rapid and fatal) and chronic (lingering, lasting) forms. For
example; in acute myeloid leukemia (AML) there is diminished production of normal red blood
cells (erythrocytes), granulocytes, and platelets (control clotting) which leads to death by anemia,
infection, or hemorrhage. These events can be rapid. In chronic myeloid leukemia (CML) the
leukemic cells retain the ability to differentiate (i.e., be responsive to stimulatory factors) and
perform function; later there is a loss of the ability to respond.
43 Pancytopenia is the reduction in the number of all three major types of blood cells
(erythrocytes, or red blood cells, thrombocytes, or platelets, and leukocytes, or white blood cells).
In adults, all three major types of blood cells are produced in the bone marrow of the vertebra,
sternum, ribs, and pelvis. The bone marrow contains immature cells, known as multipotent
myeloid stem cells, that later differentiate into the various mature blood cells. Pancytopenia
results from a reduction in the ability of the red bone marrow to produce adequate numbers of
these mature blood cells.
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continued exposure to benzene may develop aplastic anemia,44 whereas others exhibit both
pancytopenia and bone marrow hyperplasia (excessive cell formation), a condition that may
indicate a preleukemic state (Ref. 16, 17). The most sensitive noncancer effect observed in
humans is the depression of absolute lymphocyte counts in the circulating blood (Ref. 18). A
draft reference concentration (RfC) has been developed for benzene. The reference concentration
(RfC) is an estimate of a continuous inhalation exposure to the human population (including
sensitive subgroups) that is likely to be without an appreciable risk of deleterious noncancer
effects during a lifetime; these estimates frequently have uncertainty levels that span perhaps an
order of magnitude. The draft benzene RfC is 9 |ig/m3, which means that long-term exposures to
benzene should be kept below 9 |ig/m3 to avoid appreciable risks of these non-cancer effects (Ref.
19). This RfC is currently being revised.
Since benzene levels generally decrease proportionally to overall HC emissions, once
newer emission control technology is applied, the amount of benzene produced by new Small SI
engines should be reduced further from Phase 1 once this rule becomes effective.
6.2.2.2. Butadiene
1,3-Butadiene is formed in vehicle exhaust by the incomplete combustion of the fuel. It is
not present in vehicle evaporative and refueling emissions, because it is not present in any
appreciable amount in gasoline. 1,3-Butadiene accounts for 0.4 to 1.0 percent of total exhaust
TOG, depending on control technology and fuel composition.
1-3-Butadiene was classified by EPA as a Group B2 (probable human) carcinogen in 1985
(Ref. 20). This classification was based on evidence from two species of rodents and ***
epidemiologic data. EPA recently prepared a draft assessment that would determine sufficient
evidence exists to propose that 1,3-butadiene be classified as a known human carcinogen (Ref.
21). However, the Environmental Health Committee of EPA's Scientific Advisory Board (SAB),
in reviewing the draft document, issued a majority opinion that 1,3-butadiene should instead be
classified as a probable human carcinogen (Ref. 22). In the draft EPA assessment, the MLE
estimate of a lifetime extra cancer risk from continuous 1,3-butadiene exposure is about 3.9 x 10"
6/|ig/m3. In other words, it is estimated that approximately 4 persons in one million exposed to 1
|ig/m3 1,3-butadiene continuously for their lifetime (85 years in this case) would develop cancer
as a result of their exposure. Lower exposures are expected to result in risks that are lower.
44Aplastic anemia is a more severe blood disease and occurs when the bone marrow
ceases to function, i.e.,these stem cells never reach maturity. The depression in bone marrow
function occurs in two stages - hyperplasia, or increased synthesis of blood cell elements,
followed by hypoplasia, or decreased synthesis. As the disease progresses, the bone marrow
decreases functioning. This myeloplastic dysplasia (formation of abnormal tissue) without acute
leukemiais known as preleukemia. The aplastic anemia can progress to AML (acute mylogenous
leukemia).
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The unit risk estimates presented in EPA's draft risk assessment were not accepted by the
SAB. The SAB panel recommended that EPA recalculate the lifetime cancer risk estimates based
on the human data from Delzell et al. 1995 (Ref. 23) and revise EPA's original calculations to
account for the highest exposure of "360 ppm-year" instead of "250+ ppm-year"and 70 years at
risk instead of 85 years. Based on these recalculations (Ref. 24) the MLE estimate of lifetime
cancer risk from continuous 1,3-butadiene exposure is 2.21 x 10"6/|ig/m3. This estimate implies
that approximately 2 persons in one million exposed to 1 |ig/m3 1,3-butadiene continuously for
their lifetime (70 years in this case) would develop cancer as a result of their exposure.
1,3-Butadiene also causes a variety of reproductive and developmental effects in mice and
rats (no human data) when exposed to long-term, low doses of butadiene (EPA 1998c). The most
sensitive effect was reduced litter size at birth and at weaning. These effects were observed in
studies in which male mice exposed to 1,3-butadiene were mated with unexposed females. In
humans, such an effect might manifest itself as an increased risk of spontaneous abortions,
miscarriages, still births, or very early deaths. Long-term exposures to 1,3-butadiene should be
kept below its reference concentration of 0.33 |ig/m3 to avoid appreciable risks of these
reproductive and developmental effects (EPA 1998c).
1,3-Butadiene emissions appear to increase roughly in proportion to exhaust hydrocarbon
emissions. Since hydrocarbons are decreased by the use of a catalyst on a motor vehicle, 1,3-
butadiene emissions are expected to decrease proportionally with the use of any emission control
technology that decreases total hydrocarbon emission.
6.2.3 CO
Carbon monoxide (CO) is a colorless, odorless gas produced though the incomplete
combustion of carbon-based fuels. Carbon monoxide enters the bloodstream through the lungs
and reduces the delivery of oxygen to the body's organs and tissues. The health threat from CO is
most serious for those who suffer from cardiovascular disease, particularly those with angina or
peripheral vascular disease. Healthy individuals also are affected, but only at higher CO levels.
Exposure to elevated CO levels is associated with impairment of visual perception, work capacity,
manual dexterity, learning ability and performance of complex tasks.
Several recent epidemiological studies have shown a link between CO and premature
mortality and morbidity (including angina, congestive heart failure, and other cardiovascular
diseases). EPA currently is in the process of reviewing these studies as part of the CO Criteria
Document process.
Since 1979, the number of areas in the nation violating the CO NAAQS has decreased by a
factor of almost ten, from 48 areas in 1979 to five areas (covering seven counties) in 1995 and
1996. In 1997, three counties, with a total population of nine million people, failed to meet the
CO standard.
In addition to the substantial reduction in the number of areas where the NAAQS is
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exceeded, the severity of the exceedances also has decreased significantly. Nationally, CO
concentrations decreased 38 percent during the past 10 years.45 From 1979 to 1996, the measured
atmospheric concentrations of CO during an exceedance decreased from 20-25 ppm at the
beginning of the period to 10-12 ppm at the end of the period. Expressed as a multiple of the
standard, atmospheric concentration of CO during an exceedance was two to almost three times
the standard in 1979. By 1996, the CO levels present during an exceedance decreased to 10-30
percent over the 9 ppm standard.
Unlike the case with ozone and PM, EPA has not made any recent comprehensive
projections of future ambient CO levels and attainment and maintenance of the CO NAAQS.
However, section 202(j) of the CAA requires a separate study of the need for more stringent cold
CO standards. EPA is currently conducting this study.
Although the final Phase 2 emission standards for handheld Small SI engines do not
include significantly more stringent standards for CO, reductions in CO beyond Phase 1 levels,
due to improved technology, is also to be expected by year 2025.
6.2.4 Visibility and Regional Haze
Visibility impairment is the haze that obscures what we see, and is caused by the presence
of tiny particles in the air. These particles cause light to be scattered or absorbed, thereby
reducing visibility. Visibility impairment, also called regional haze, is a complex problem that
relates to several pollutants. Visibility in our national parks and monuments, and many urban
areas of the country, continues to be obscured by regional and local haze.
The principle cause of visibility impairment is fine particles, primarily sulfates, but also
nitrates, organics, and elemental carbon and crustal matter. Particles between 0.1 and one
micrometers in size are most effective at scattering light, in addition to being of greatest concern
for human health. Of the pollutant gases, only NO2 absorbs significant amounts of light; it is
partly responsible for the brownish cast of polluted skies. However, it is responsible for less than
ten percent of visibility reduction.
In the eastern U.S., reduced visibility is mainly attributable to secondary particles,
particularly those less than a few micrometers in diameter. Based on data collected by the
Interagency Monitoring of Protected Visual Environments (IMPROVE) network for visibility
monitoring, sulfate particles account for about 50-70 percent of annual average light extinction in
eastern locations. Sulfate plays a particularly significant role in the humid summer months, most
notably in the Appalachian, northeast, and mid-south regions. Nitrates, organic carbon, and
elemental carbon each account for between 10-15 percent of total light extinction in most eastern
locations. Rural areas in the eastern U.S. generally have higher levels of impairment than most
45This value of the CO concentration decrease is measured by the composite average of
the annual second highest 8-hour concentration.
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remote sites in the western U.S., generally due to the eastern U.S.'s higher levels of man-made
pollution, higher estimated background levels of fine particles, and higher average relative
humidity levels.
The relative contribution of individual pollutants to visibility impairment vary
geographically. While secondary particles still dominate in the West, direct particulate emissions
from sources such as woodsmoke contribute a larger percentage of the total particulate load than
in the East. In the rural western U.S., sulfates also play a significant role, accounting for about
25-40 percent of total light extinction in most regions. In some areas, such as the Cascades
region of Oregon, sulfates account for over 50 percent of annual average light extinction. Organic
carbon typically is responsible for 15-35 percent of total light extinction in the rural western U.S.
and elemental carbon (absorption) accounts for about 15-25 percent, so the total carbonaceous
contribution is between 30 and 60 percent. Soil dust (coarse PM) accounts for about 10-20
percent. Nitrates typically account for less than 10 percent of visibility impairment (Ref. 25).
The CAA requires EPA to protect visibility, or visual air quality, through a number of
programs. These programs include the national visibility program under sections 169a and 169b
of the Act, the Prevention of Significant Deterioration program for the review of potential impacts
from new and modified sources, and the secondary NAAQS for PM10 and PM2 5. The national
visibility program established in 1980 requires the protection of visibility in 156 mandatory
Federal Class I areas across the country (primarily national parks and wilderness areas). The CAA
established as a national visibility goal, "the prevention of any future, and the remedying of any
existing, impairment of visibility in mandatory Federal class I areas in which impairment results
from manmade air pollution." The Act also calls for state programs to make "reasonable
progress" toward the national goal. In July 1999, EPA promulgated a program to address regional
haze in the nation's most treasured national parks and wilderness areas (see 64 FR 35714, July 1,
1999).
Since mobile sources contribute to visibility-reducing PM, control programs that reduce
the mobile source emissions of direct and indirect PM will have the effect of improving visibility.
Western Governors, in commenting on the Regional Haze Rule and on protecting the 16 Class I
areas on the Colorado Plateau, stated that, "...the federal government must do its part in regulating
emissions from mobile sources that contribute to regional haze in these areas..." and called on
EPA to make a "binding commitment to fully consider the Commission's recommendations
related to the ... federal national mobile source emissions control strategies", including Tier 2
vehicle emissions standards (Ref. 26). The Grand Canyon Visibility Transport Commission's
report found that reducing total mobile source emissions is an essential part of any program to
protect visibility in the Western U.S (Ref. 27). The Commission identifies mobile source
pollutants of concern as VOC, NOX, and elemental and organic carbon.
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Chapter 6 References
la. Power Systems Research, Engine Data and Parts Link Data bases, St. Paul, Minnesota
1992.
Ib. PPEMA , Hand Held Composite Duty Cycle Report, February 1995. Docket # A-96-55,
II-D-18.
1. U.S. EPA, 1996, Review of National Ambient Air Quality Standards for Ozone,
Assessment of Scientific and Technical Information, OAQPS Staff Paper, EPA-452/R-96-
007.
2. U.S. EPA, 1996, Air Quality Criteria for Ozone and Related Photochemical Oxidants,
EPA/600/P-93/004aF.
3. U.S. EPA, 1995, Review of National Ambient Air Quality Standards for Nitrogen
Dioxide, Assessment of Scientific and Technical Information, OAQPS Staff Paper,
EPA-452/R-95-005
4. U.S.EPA, 1993, Air Quality Criteria for Oxides of Nitrogen, EP A/600/8-9 l/049aF.
5. Vitousek, Pert M., John Aber, Robert W. Howarth, Gene E. Likens, et al. 1997. Human
Alteration of the Global Nitrogen Cycle: Causes and Consequences. Issues in Ecology.
Published by Ecological Society of America, Number 1, Spring 1997.
6. U.S. EPA, 1990, Emissions Inventory of Forty Section 112(k) Pollutants; Supporting Data
for EPA's Proposed Section 112(k) Regulatory Strategy. External Review Draft,
September 1, 1997.
7. EPA 1998a. Environmental Protection Agency, Carcinogenic Effects of Benzene: An
Update, National Center for Environmental Assessment, Washington, DC. 1998.
8. EPA 1985. Environmental Protection Agency, Interim quantitative cancer unit risk
estimates due to inhalation of benzene, prepared by the Office of Health and
Environmental Assessment, Carcinogen Assessment Group, Washington, DC. for the
Office of Air Quality Planning and Standards, Washington, DC., 1985.
9. Clement Associates, Inc., Motor vehicle air toxics health information, for U.S. EPA Office
of Mobile Sources, Ann Arbor, MI, September 1991.
10. International Agency for Research on Cancer, IARC monographs on the evaluation of
carcinogenic risk of chemicals to humans, Volume 29, Some industrial chemicals and
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dyestuffs, International Agency for Research on Cancer, World Health Organization,
Lyon, France, p. 345-389, 1982.
11. Irons, R.D., W.S. Stillman, D.B. Colagiovanni, and V.A. Henry, Synergistic action of the
benzene metabolite hydroquinone on myelopoietic stimulating activity of
granulocyte/macrophage colony-stimulating factor in vitro, Proc. Natl. Acad. Sci. 89:3691-
3695, 1992.
12. Lumley, M., H. Barker, and J.A. Murray, Benzene in petrol, Lancet 336:1318-1319, 1990.
13. EPA 1993a. Motor Vehicle-Related Air Toxics Study, U.S. Environmental Protection
Agency, Office of Mobile Sources, Ann Arbor, MI, EPA Report No. EPA 420-R-93-005,
April 1993.
14. Aksoy, M. 1991. Hematotoxicity, leukemogenicity and carcinogenicity of chronic
exposure to benzene. In: Arinc, E.; Schenkman, J.B.; Hodgson, E., Eds. Molecular
Aspects of Monooxygenases and Bioactivation of Toxic Compounds. New York: Plenum
Press, pp. 415-434.
15. Goldstein, B.D. 1988. Benzene toxi city. Occupational medicine. State of the Art
Reviews. 3: 541-554.
16. Aksoy, M., S. Erdem, and G. Dincol. 1974. Leukemia in shoe-workers exposed
chronically to benzene. Blood 44:837.
17. Aksoy, M. and K. Erdem. 1978. A follow-up study on the mortality and the development
of leukemia in 44 pancytopenic patients associated with long-term exposure to benzene.
Blood 52: 285-292.
18. Rothman, N., G.L. Li, M. Dosemeci, W.E. Bechtold, G.E. Marti, Y.Z. Wang, M. Linet,
L.Q. Xi, W. Lu, M.T. Smith, N. Titenko-Holland, L.P. Zhang, W. Blot, S.N. Yin, and R.B.
Hayes. 1996. Hematotoxicity among Chinese workers heavily exposed to benzene. Am. J.
Ind. Med. 29: 236-246.
19. EPA 1998b. Environmental Protection Agency, Toxicological Review of Benzene (Non-
Cancer Effects), July 1998 draft. National Center for Environmental Assessment,
Washington, DC.
20. EPA, 1985. Mutagenicity and carcinogenicity assessment of 1,3-butadiene. EPA/600/8-
85/004F. U.S. Environmental Protection Agency, Office of Health and Environmental
Assessment. Washington, DC.
21. EPA 1998c. Environmental Protection Agency, Health Risk Assessment of 1,3-Butadiene.
EPA/600/P-98/001A, February 1998.
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22. Scientific Advisory Board. 1998. An SAB Report: Review of the Health Risk Assessment
of 1,3-Butadiene. EPA-SAB-EHC-98, August, 1998.
23. Denzell, E., N. Sathiakumar, M. Macaluso, M. Hovinga, R. Larson, F. Barbone, C. Beall,
and P. Cole, 1995. A follow-up study of synthetic rubber workers. Final report prepared
under contract to International Institute of Synthetic Rubber Producers, October 2, 1995.
24. EPA 1999a. Memo from Dr. Aparna Koppikar, ORD to Laura McKlevey, OAQPS and
Pamela Brodowicz, QMS. Slope Factor for 1,3-Butadiene, April 26, 1999.
25. "National Air Quality and Emissions Trends Report, 1996", EPA Document Number
454/R-97-013.
26. Letter from Governor Michael Leavitt of Utah, on behalf of the Western Governors'
Association, to EPA Administrator Carol Browner, dated June 29, 1998.
27. "Report of the Grand Canyon Visibility Transport Commission to the United States
Environmental Protection Agency", June 1996.
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Chapter 7: Analysis of Aggregate Costs
Chapter 7: Analysis of Aggregate Costs
This chapter develops the uniform annualized cost per class and the average cost per
equipment per class for this rulemaking. This chapter also assesses the cost-effectiveness, in
terms of dollars per ton of total emission reductions. This analysis relies on cost information from
Chapters 4 and 5 and emissions information from the NONROAD model46 presented in Chapter 6.
Lastly, this chapter discusses possible economic effects of the regulation and compares the cost-
effectiveness of the new provisions with the cost-effectiveness of other HC+NOx control
strategies from previous EPA rulemakings.
Two cost scenarios, a "high cost" scenario and a "mid cost" scenario, based on differing
assumption about catalyst usage in Class IV applications are presented in this chapter. The "high
cost" scenario is based on the statement from John Deere that they will be able to meet the Phase
2 standard with only half of their product line using catalysts due to the use of ABT and further
improvements in engine design and resultant emission reductions. Therefore, the high cost
scenario utilizes the assumption that half of John Deere's Class IV engines will use the
compliance wave technology with a catalyst and the other half will use the compression wave
technology without a catalyst. The "mid cost" scenario is based on the assumption that the small
engine market is a competitive marketplace and therefore all manufacturers that utilize the
compression wave technology, will attempt to improve engine emission out performance such that
only half of their Class IV engine production will require catalysts in order to remain competitive
with John Deere. In addition, the second scenario considers that John Deere will not need to pay
the licensing fee for use of the compression wave technology and therefore this cost is removed
John Deere's Class IV production.
7.1 Aggregate Cost Analysis for the Period 2002 to 2027
The analysis examines total annual costs of the final standards for all applicable engines47
from 2002 through 2027. (EPA analyzed costs over the period from 2002 to 2027 to ensure that
the fleet was completely turned over to Phase 2 engines.) The complete year-by-year stream of
costs over time that are summarized in this section can be found in Appendix E. The uniform
annualized cost and average cost per equipment are calculated by class. Costs of variable
hardware, production, research and development, and compliance programs are used and
annualized where appropriate. Cost savings due to reduced fuel consumption are also addressed,
46 The NONROAD emission model accounts for factors including various
equipment types, residential or professional usage, lifetime of the equipment, and
scrappage. See Chapter 6 for more details regarding the NONROAD model.
47 The analysis covers all engines sold in the United States except those sold in
California which are covered by rulemakings established by the California ARB.
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including the valuation of the reduced fuel consumption to the consumer. Total costs to society
are presented as the aggregate costs to consumers with and without fuel savings.
This analysis is based on cost estimates for variable and fixed costs from the 1996 ICF and
EF&EE cost study, comments to the January 1998 NPRM and July 1999 SNPRM, and
manufacturer data. The 1996 cost estimates are adjusted by the GDP Implicit Price deflator for
1996, 1997 and 1998 for costs in 1998$. The costs for the compliance program were based on
costs in 1997 and are also adjusted accordingly.
This analysis also accounts for estimates of the increased costs associated with complying
with the new emission standards. We avoid predicting actual price increases, since this would
depend on an assessment of complex factors such as demand elasticity, the availability of
competitive models, and the general state of the economy. A 29 percent markup of the costs
presented in Chapter 4 is used in this analysis to predict the costs related to the changes the engine
manufacturers and their dealers (or mass merchandisers) need to make to comply with emission
standards. Further downstream markups or other pricing strategies may further increase the price
of the product, but these are not a necessary or direct impact of the new emission standards. Full
cost pass through and profitability on increased costs are assumed. It should be noted that the
markup was applied to the specific variable engine and equipment manufacturer costs (hardware
and production) identified in this chapter.
7.1.1 Uniform Annualized Costs
A uniform annualized cost is an expression of the equal annual payments that would be
equivalent to a given cash flow schedule for a known interest rate. This expression of an
annualized cost was chosen due to the variety of the programs that makeup this Phase 2
regulation. The methodology used for calculating the uniform annualized costs is as follows.
The EPA Phase 1 certification database was utilized to determine the number of engines,
and related number of models, that would likely be improved during the course of the phase-in
(see Tables E-01 to E-03 in Appendix E). The costs per engine (variable and fixed costs) for
emission improvements were estimated from the information listed in Chapter 4. The variable
costs per engine are then multiplied by the number of engines in that year48 to incorporate that
technology or set of technologies. The fixed costs are amortized for five years for the engine and
ten years for equipment starting in the phase-in years in which they are calculated to be
48 The future sales growth estimates are based on the 1998 Phase 1 certification database industry
production estimates and the growth assumptions utilized in the NONROAD model for the main
types of equipment from 2002 to 2027 (average percentage increases (2 percent) are used for 1999
through 2001). The population estimates from the NONROAD model are converted to yearly
percentage increases and then these percentages are applied to the 1998 estimated production to
calculate resultant sales estimates for future years. EPA has not assumed any impact of increased
cost for Phase 2 engines on future sales.
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Chapter 7: Analysis of Aggregate Costs
49
recovered.
In order to determine the uniform annualized costs, the annual costs were discounted to the
first year the Phase 2 standards are implemented (i.e., 2002 for Classes in and IV and 2004 for
Class V) at a rate of seven percent (the consumption rate of interest). The uniform annualized
cost was obtained by summing the discounted costs over the appropriate time period and dividing
by the appropriate present worth factor (at an interest rate of 7 percent over the corresponding
number of years). The sections below address each cost category separately. Section 7.3.
contains the full 20 year analysis of total cost of the final standards.
7.1.1.1. Variable Costs — Tables 7-01 contains the estimates for uniform
annualized variable costs per class with consumer markup (see Table E-07 and Table E-l 1 in
Appendix E for costs per year on which these tables are based). For Class IV, there are two
results presented for the two different catalyst usage scenarios analyzed. The results are
calculated to the first year of implementation which is 2002 for Classes HI and IV, and 2004 for
Class V. It should be noted that a learning curve discount of 20 percent was applied to the
technology cost, not the licensing fee, in the first full year of implementation for each class, which
is 2005 for Classes HI and IV, and 2007 for Class V. None of the cost information used already
anticipated such a learning curve; the John Deere information assumed the costs for 100 %
implementation in 2001, not the subsequent decrease in these cost due, for example, to improved
manufacturing processes. Thus it is to appropriate to add the effects of a learning curve to future
production to account for the optimization of the technologies that will likely occur as
manufacturers gain experience in producing these new emission reduction technology designs on
a number of engine models.
49 A learning curve discount of 20 percent on variable costs was applied in the first full year of
implementation (i.e., 2005 for Classes III and IV, and 2007 for Class V). The reason for this is
due to the likelihood that manufacturers will further optimize the engine design as they gain
experience with applying the technology to other engine families, and decrease costs. Due to the
notable number of engines that are certified several times due to changes to the engine for
application differences, the EPA Phase 1 database was reviewed for these similarities. Once
found, a major fixed cost was applied only once and a decreased fixed cost was assigned to the
other families with the very similar engine.
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Chapter 7: Analysis of Aggregate Costs
Table 7-01
Uniform Annualized Variable Cost per Class With
Consumer Markup, for the Period 2002 to 2027 (SThousands, 1998$)
Engine Class
m
IV - "High Cost" scenario*
IV - "Mid Cost" scenario*
V
Engine
$35,821
$252,281
$195,603
$14,639
Equipment
$3,120
$14,508
$9,349
$326
Total
$38,941
$266,789
$204,952
$14,965
* - Class IV is the only class for which there are different assumptions in the cost
methodology under the two different scenarios.
7.1.1.2. Capital Costs — Engine improvements, and thereby capital expenditures,
are phased-in over time for Classes in through V. The phase-in and number of models for all
classes were determined in Chapter 4. Capital costs are estimated to be recovered over 5 years for
engines and 10 years for equipment, at a 7 percent interest rate. Costs are assumed to be incurred
one year prior to the respective phase-in. Costs are assumed to begin to be recovered one year
after they were incurred using a 7 percent interest rate.
Potential capital cost increases include costs for development and application of engine
designs with reduced emissions and costs for production facilities. Capital costs were applied to
each unique displacement engine per manufacturer. Engine families which had the same engine
displacement, but different equipment type, were allotted a lesser capital cost.
EPA has estimated the uniform annualized fixed costs as shown in Table 7-02. The results
are calculated to first year of implementation which is 2002 for Classes in and IV and 2004 for
Class V. Appendix E contains the tables on which this table is based.
Table 7-02
Uniform Annualized Fixed Cost per Class, for the Period 2002 to 2027
($Thousands, 1998$)
Engine Class
m
IV - "High Cost" Scenario
IV - "Mid Cost" Scenario
V
Engine
$457
$6,226
$5,460
$1,433
Equipment
$412
$5,271
$3,998
$252
Total
$869
$11,497
$9,458
$1,685
* - Capital costs are the same for both the "high cost" scenario and the "mid
cost" scenario.
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Chapter 7: Analysis of Aggregate Costs
7.1.1.3. Compliance Costs — This rulemaking accounts for those costs that are above
and beyond those for the Phase 1 program. These costs are the compliance program costs
presented in Chapter 5. Compliance costs include costs for certification and production line
testing (PLT). Certification costs are treated as fixed costs and production line testing costs are
treated as variable costs for this analysis. Appendix E and Chapter 5 contain details on the
program costs assumed for the compliance programs. The estimates for the administrative burden
for these programs are estimated in the supporting statements for the Information Collection
Requests submitted to OMB. These supporting statements contain estimates of the testing, record
keeping, and reporting burden on industry that would occur under the final regulations.
Table 7-03 contains the uniform annualized compliance costs for all classes. The results
are calculated to first year of implementation which is 2002 for Classes in and IV and 2004 for
Class V.
Table 7-03
Uniform Annualized Compliance Programs, for the Period 2002 to 2027
(SThousands, 1998$)
Engine Class
m
IV*
y**
Cost
$19
$232
$87
* - Compliance costs are the same for both the "high cost" scenario and the
"mid cost" scenario.
** - Note that this Class V analysis contains the four engine families (2 of
which are assumed small volume) that will likely be certified to Class I-B.
The total uniform annualized costs for this rulemaking are presented in Table 7-04 for
both the "high-cost" scenario and the "mid-cost" scenario..
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Table 7-04
Total Uniform Annualized Costs Including Consumer Markups,
for the Period 2002 to 2027 (SThousands, 1998$)
Engine Class
m
IV
V
Total
"High-cost"
Scenario
$31,076
$219,392
$33,966
$284,434
"Mid-cost"
Scenario
$31,076
$169,271
$33,966
$233,773
- Classes in and IV are annualized to 2002, Class V is annualized to 2004.
7.1.1.4. Fuel Savings ~ As explained in Chapter 4, the technological changes
necessary to bring these engines into compliance with the final emission standards would cause a
decrease in fuel consumption of approximately 30 percent for handheld engines. The tons per
year savings per class (see Appendix E) are converted to gallons per year and then multiplied by
$0.802 per gallon (1998$ adjusted by GDP) to determine the fuel savings.50 Table 7-05 contains
the uniform annualized fuel savings for all equipment types in each class which have been
discounted 7 percent to the first year of implementation for each class. The total value is for all
classes discounted to the year 2002 for Classes in and IV and 2004 for Class V. Table E-05 in
Appendix E contains the yearly fuel savings information on which this analysis is based.
50
EPA estimated a gasoline cost of $0.765 per gallon, based on the average refinery
price to the end user in 1995 from the Energy Information Administration.
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Chapter 7: Analysis of Aggregate Costs
Table 7-05
Uniform Annualized Fuel Savings
and Comparison to Uniform Annualized Cost, for the Period 2002 to 2027
(SThousands, 1998$)
Engine Class*
m
IV
V
Total
Uniform
Annualized
Fuel
Savings
$2,316
$43,616
$48,482
$94,414
"High Cost"
Scenario -
Uniform
Annualized
Cost
$31,076
$219,392
$33,966
$284,434
"Mid Cost"
Scenario -
Uniform
Annualized
Cost
$31,076
$169,271
$33,966
$233,773
"High Cost"
Scenario -
Resultant
Costs
$28,760
$175,776
($14,516)
$190,020
"Mid Cost"
Scenario -
Resultant
Costs
$28,760
$125,655
($14,516)
$139,359
* Classes HI and IV to 2002, Class V to 2004
7.1.2 Average Cost Per Equipment
The average cost per equipment changes over time due to the recovering of capital costs
and the increased production over which costs can be spread. Therefore this analysis calculates a
range of cost that is based on the uniform annualized cost. Since the production of these engines
is assumed to increase over the years of this analysis, this section presents a range of cost per
equipment estimates. The uniform annualized cost is divided by the production in the first full
implementation year (2005 for Classes IE and IV and 2007 for Class V) and the last year (2027)
accounted for in this analysis. Results are shown in Table 7-06. An average of this range is also
presented.
Table 7-06
Average Cost Per Equipment per Engine Class
Based on Uniform Annualized Costs(1998$)
Engine Class
m
IV - "High Cost" Scenario
IV - "Mid Cost" Scenario
V
Cost in First Full
Year*
$23.20
$25.60
$19.70
$54.80
Cost in 2027
$16.10
$17.80
$13.70
$37.80
* - 2005 for Classes IE and IV, 2007 for Class V
7.1.2.1. Fuel Savings — The resultant fuel savings per engine per class is
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Chapter 7: Analysis of Aggregate Costs
calculated by taking the total fuels savings cost and dividing by the number of pieces of Phase 2
equipment in the class. The resultant cost per engine is then calculated by subtracting the fuel
savings per engine from the total cost per equipment. Results are listed in Table 7-07 below.
Table 7-07
Annual Fuel Savings and Resultant Cost per Equipment
Based on Uniform Annualized Analysis (1998$)
Engine Class
m
IV - "High
Cost" Scenario
IV - "Mid Cost"
Scenario
V
Average Cost Per
Equipment
$19.60
$21.70
$16.70
$46.30
Average Annual Fuel
Savings Per Equipment
$0.50
$1.70
$1.70
$30.80
Average Resultant Cost
Per Equipment
$19.10
$20.00
$15.00
$15.50
The differences seen in the fuel savings between handheld classes (Classes HI through V)
in Table 7-07 is due to factors contained in the NONROAD emission model from which they
were calculated. Such factors include the equipment application, annual hours of use, equipment
life, scrappage rates, and engine power. For example, Class V engines are higher in power and
the majority are used in commercial equipment that are operated for high numbers of hours per
year and therefore the fuel savings are significantly more notable. Class IV engines see a higher
fuel savings per engine, primarily due to the higher power in this class compared to Class HI
engines.
The overall increase in price per equipment per engine class can be compared to the selling
price of the equipment in which Small SI engines are used. Handheld equipment in Classes in
include trimmers which can be found in the marketplace for $70. An increase of $19.60 per
equipment is 28 percent of this price. Equipment in Class IV include trimmers, chainsaws and
blowers for both consumer and commercial use. These equipment sell for approximately $200
and the increase of $23.40 ("High Cost" scenario) to $19.50 ("Mid Cost" scenario) is 12 tolO
percent of this price. Class V equipment includes professional-use chainsaws which sell for
approximately $400. An increase of $54.60 is 14 percent of this price.
7.2 Cost-effectiveness
The following section describes the cost-effectiveness of the finalized HC+NOx standards
for the various classes of handheld Small SI engines. As discussed in Chapter 4, the estimated
cost of complying with the provisions varies depending on the model year under consideration.
The following section presents the total cost-effectiveness over all of the model years after the
standards take effect. These cost-effectiveness numbers are calculated by taking the net present
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Chapter 7: Analysis of Aggregate Costs
value of the total costs per year (including amortized capital and variable costs) over the 27 year
time line, discounted by 7 percent, and dividing it by the net present value of the emission benefits
discounted by 7 percent. Table 7-08 presents the resulting cost-effectiveness results for both the
"High Cost" scenario and the "Mid Cost" scenario.
Table 7-08
Cost-effectiveness of Finalized Phase 2 Rulemaking for Handheld Engines
Scenario
Without Fuel Savings
With Fuel Savings
"High Cost" Scenario -
Cost-effectiveness
($/short ton)
$1,020
$750
"Mid Cost" Scenario -
Cost Effectiveness
($/short ton)
$830
$560
In an effort to evaluate the cost-effectiveness of the finalized handheld (HH) engine
standards, EPA has summarized the cost-effectiveness results for several other recent EPA
mobile source rulemakings. Table 7-09 summarizes the cost-effectiveness results from the
Phase 2 Nonhandheld (NHH) Small SI final rule (Ref. 1), the Small SI Engine Phase 1
rulemaking (Ref. 2), the SI Recreational Marine Engine rulemaking (Ref. 3) and the recently
final standards for nonroad compression-ignition (CI) engines (Ref. 4).
Table 7-09
Cost-effectiveness of Other EPA Nonroad Rulemakings (With Fuel Savings)
Rulemaking
Small SI, Phase 2 HH - "High Cost" Scenario
Small SI, Phase 2 HH - "Mid Cost" Scenario
Small SI, Phase 2 NHH (Ref. 1)
Small SI, Phase 1 (Ref. 2)
SI Recreational Marine (Ref. 3)
Nonroad CI, Tier 2/Tier 3 (Ref. 4)
Cost-effectiveness
$750
$560
$-507
$217
$1,000
$410-$650
Pollutants
HC+NOx
HC+NOx
HC+NOx
HC+NOx
HC
HC+NOx
7.3 20-Year Cost Analysis
Table 7-10 contains the year-by-year fleetwide costs and emission benefits associated
with the finalized Small SI Phase 2 handheld engine standards for the 20-year period from 2002
to 2021 for the "High Cost" scenario. EPA has performed an aggregate costs analysis over a
twenty year time frame in response to a request from the Office of Management and Budget.
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Chapter 7: Analysis of Aggregate Costs
Fuel savings are not included in this analysis as they would significantly reduce the costs of the
program. The GDP Implicit price deflators for 1996-1998 were included to compute the costs
per year based on 1996 and 1997 cost estimates for technology and compliance program costs
respectively. (The numbers presented in Table 7-10 are not discounted).
"High Cost" Scenario:
Handheld Engine
Table 7-10
Costs and Emission Benefits of the Small SI Phase 2
Standards for the 20-Year Cost Analysis in 1998$
(Fuel Savings Not Included)
Calendar Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Fleetwide Costs
$76,144,705
$145,129,948
$217,764,541
$282,270,658
$275,392,788
$229,923,545
$252,652,358
$247,178,658
$247,352,941
$250,837,014
$253,771,984
$239,644,642
$243,419,742
$242,690,197
$246,846,513
$250,642,420
$254,440,118
$258,236,459
$262,032,019
$265,828,866
Fleetwide Reductions (short
tons) HC+NOx
19,072
52,607
121,077
202,141
269,406
325,790
350,220
363,359
373,072
381,842
389,707
397,304
404,848
412,376
420,269
427,816
435,362
442,908
450,455
457,998
Table 7-11 contains the discounted year-by-year fleetwide costs and emission benefits
associated with the finalized Small SI Phase 2 handheld engine standards for the 20 year period
from 2002 to 2021 for the "High Cost" scenario. The year-by-year results were discounted to
2002 and a discount rate of seven percent was assumed for the analysis.
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Chapter 7: Analysis of Aggregate Costs
Table 7-11
"High Cost" Scenario: Discounted Costs and Emission Benefits of the Small SI Phase 2
Handheld Engine Standards for the 20-year Cost Analysis in 1998$
(Fuel Savings Not Included)
Calendar Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Fleetwide Costs
$76,144,705
$135,635,465
$190,203,983
$230,416,939
$210,095,839
$163,932,310
$168,352,934
$153,930,446
$143,961,664
$136,438,716
$129,004,809
$113,853,443
$108,081,276
$100,707,804
$95,731,333
$90,844,347
$86,187,671
$81,751,050
$77,525,819
$73,503,896
Fleetwide Reductions
(short tons) HC+NOx
19,072
49,165
105,754
165,008
205,528
232,284
233,366
226,282
217,131
207,697
198,108
188,756
179,758
171,122
162,988
155,060
147,472
140,213
133,273
126,640
Summing the discounted annual costs and discounted emission reductions over the
twenty year period yields a 20-year fleetwide cost of $2.6 billion and 20-year emission reductions
of 3.3 million tons of HC+NOx for the "High Cost" scenario. The resulting 20 year annualized
fleetwide costs and emission reductions are $242 million per year and 308,000 tons per year of
HC+NOx for the "High Cost" scenario. The spreadsheets prepared for this analysis are
contained in Appendix E. The reader is directed to the spreadsheets for a complete version of the
analysis.
Table 7-12 contains the year-by-year fleetwide costs and emission benefits associated
with the finalized Small SI Phase 2 handheld engine standards for the 20-year period from 2002
to 2021 for the "Mid Cost" scenario. As noted above, fuel savings are not included in this
analysis as they would significantly reduce the costs of the program. The GDP Implicit price
deflators for 1996-1998 were included to compute the costs per year based on 1996 and 1997
cost estimates for technology and compliance program costs respectively. (The numbers
presented in Table 7-12 are not discounted).
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Chapter 7: Analysis of Aggregate Costs
'Mid Cost" Scenario:
Handheld Engine
Table 7-12
Costs and Emission Benefits of the Small SI Phase 2
Standards for the 20-Year Cost Analysis in 1998$
(Fuel Savings Not Included)
Calendar Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Fleetwide Costs
$61,791,860
$115,911,954
$172,102,927
$219,104,486
$210,976,042
$168,762,358
$185,019,678
$179,619,389
$180,348,891
$182,639,144
$184,468,045
$174,224,195
$176,893,311
$175,057,803
$178,017,638
$180,703,024
$183,390,202
$186,076,021
$188,761,058
$191,447,384
Fleetwide Reductions (short
tons) HC+NOx
19,072
52,607
121,077
202,141
269,406
325,790
350,220
363,359
373,072
381,842
389,707
397,304
404,848
412,376
420,269
427,816
435,362
442,908
450,455
457,998
Table 7-13 contains the discounted year-by-year fleetwide costs and emission benefits
associated with the finalized Small SI Phase 2 handheld engine standards for the 20 year period
from 2002 to 2021 for the "Mid Cost" scenario. The year-by-year results were discounted to
2002 and a discount rate of seven percent was assumed for the analysis.
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Chapter 7: Analysis of Aggregate Costs
Table 7-13
"Mid Cost" Scenario: Discounted Costs and Emission Benefits of the Small SI Phase 2
Handheld Engine Standards for the 20-year Cost Analysis in 1998$
(Fuel Savings Not Included)
Calendar Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Fleetwide Costs
$61,791,860
$108,328,929
$150,321,362
$178,854,527
$160,952,612
$120,325,229
$123,286,424
$111,857,928
$104,964,697
$99,343,593
$93,774,200
$82,772,660
$78,542,745
$72,642,765
$69,038,309
$65,495,092
$62,120,606
$58,906,903
$55,847,586
$52,936,797
Fleetwide Reductions
(short tons) HC+NOx
19,072
49,165
105,754
165,008
205,528
232,284
233,366
226,282
217,131
207,697
198,108
188,756
179,758
171,122
162,988
155,060
147,472
140,213
133,273
126,640
Summing the discounted annual costs and discounted emission reductions over the
twenty year period yields a 20-year fleetwide cost of $1.9 billion and 20-year emission reductions
of 3.3 million tons of HC+NOx for the "Mid Cost" scenario. The resulting 20 year annualized
fleetwide costs and emission reductions are $180 million per year and 308,000 tons per year of
HC+NOx for the "Mid Cost" scenario. The spreadsheets prepared for this analysis are contained
in Appendix E. The reader is directed to the spreadsheets for a complete version of the analysis.
7.4 Fuel Savings
Table 7-14 contains the year-by-year fleetwide gallon and monetary fuel savings
associated with the finalized Small SI Phase 2 handheld engine standards of the 20-year period
from 2002 to 2021. The numbers apply to both the "High Cost" and "Mid Cost" scenarios.
(The numbers presented in Table 7-14 are not discounted).
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Chapter 7: Analysis of Aggregate Costs
Table 7-14
Fuel Savings of the Finalized Small SI Phase 2 Handheld
Engine Standards for the 20-year Cost Analysis in 1998$
Calendar Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Fleetwide Savings
($4,464,205)
($12,167,205)
($29,998,435)
($51,044,847)
($68,935,507)
($84,551,600)
($90,595,534)
($93,824,844)
($99,725,771)
($102,039,415)
($104,164,591)
($106,234,669)
($108,292,214)
($110,349,285)
($112,472,096)
($114,531,296)
($116,588,605)
($118,647,332)
($120,706,768)
($122,765,022)
Fleetwide Savings (gallons)
(5,564,331)
(15,165,602)
(37,391,029)
(63,623,965)
(85,923,468)
(105,387,876)
(112,921,233)
(116,946,350)
(124,301,459)
(127,185,261)
(129,834,149)
(132,414,362)
(134,978,953)
(137,542,954)
(140,188,895)
(142,755,549)
(145,319,846)
(147,885,910)
(150,452,859)
(153,018,334)
Table 7-15 contains the discounted year-by-year fleetwide gallon and related monetary
fuel savings associated with the finalized Small SI Phase 2 handheld engine standards for the 20
year period from 2002 to 2021. The year-by-year results were discounted to 2002 and a discount
rate of seven percent was assumed for the analysis. Again, the results are applicable for both the
"High Cost" and "Mid Cost" scenarios.
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Chapter 7: Analysis of Aggregate Costs
Table 7-15
Discounted Fuel Savings of the Finalized Small SI Phase 2
Handheld Engine Standards for the 20 year Cost Analysis in 1998$
Calendar Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Fleetwide Savings
($4,464,205)
($11,371,219)
($26,201,795)
($41,667,800)
($52,590,568)
($60,284,122)
($60,367,630)
($58,429,397)
($58,041,307)
($55,502,681)
($52,951,996)
($50,471,326)
($48,083,038)
($45,791,030)
($43,618,618)
($41,511,413)
($39,492,594)
($37,560,707)
($35,712,777)
($33,945,552)
Fleetwide Savings (gallons)
(5,564,331)
(14,173,459)
(32,658,773)
(51,936,107)
(65,550,602)
(75,140,099)
(75,244,186)
(72,828,309)
(72,344,581)
(69,180,355)
(66,001,098)
(62,909,109)
(59,932,269)
(57,075,436)
(54,367,671)
(51,741,181)
(49,224,859)
(46,816,892)
(44,513,572)
(42,310,845)
Summing the discounted fuel savings over the twenty year period yields a 20-year
fleetwide fuel savings of $858 million and 1.07 billion gallons of gasoline. The resulting 20 year
annualized fleetwide fuel savings are $81 million per year and 101 million gallons of gasoline
per year. These results are applicable to both the "High Cost" and "Mid Cost" scenarios. The
spreadsheets prepared for this analysis are contained in Appendix E. The reader is directed to the
spreadsheets for a complete version of the analysis.
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Chapter 7: Analysis of Aggregate Costs
Chapter 7 References
1. "Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or
Below 19 Kilowatts; Final Rule", Docket Item V-A-01.
2. "Control of Air Pollution; Emission for New Nonroad Spark-ignition Engines At or Below
19 Kilowatts; Final Rule", US EPA, Federal Register, vol 60, No. 127, Monday, July 3, 1995, 40
CFR part 90, pg 34596.
3. "Air Pollution Control; Gasoline Spark-Ignition Marine engines; New Nonroad Compression-
Ignition and Spark-Ignition Engines, Exemptions; Rule", US EPA, Federal Register, vol 61, No.
194, Friday October 4, 1996, 40 CFR parts 89, 90 and 91, pg 52100.
4. ""Final Regulatory Impact Analysis: Control of Emissions from Nonroad Diesel Engines",
August 1998, Docket Item V-B-1.
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Chapter 8: Assessment of Impacts on Small Entities
Chapter 8: Assessment of Impacts on Small Entities
8.1 Introduction and Methodology
This chapter assesses the impact of today's rulemaking on small entities, to enable EPA
to determine both the degree of impact and the number of small entities impacted. The analysis
presents both a base case and a second case that shows the impact of small-volume manufacturer
and small-volume engine family flexibilities that are being finalized in this rulemaking.
8.1.1 Regulatory Flexibility
Small entities include small businesses, small not-for-profit organizations, and small
governmental jurisdictions. As noted in the Draft RIA, small not-for-profit organizations and
small governmental jurisdictions are not expected to be impacted by this rulemaking, thus the
analysis is focused on small businesses, specifically on the impact of today's rulemaking on
handheld engine and equipment manufacturers.
8.1.2 Methodology.
The Draft RIA relied on information from a cost study and a small business impact study
performed by ICF Incorporated under a contract with EPA, to determine the economic impact of
the original proposed regulations on small entities.(Ref 1) (Ref. 2) The other primary data
sources for the small business impact analysis included the EPA Phase 1 Certification database,
the Power Systems Research OELINK (PSR) database, and the Dun & Bradstreet Market
Identifiers Online (D&B) database.
The ICF cost study relied on the PSR database for engine and sales data, and incorporated
the results of an engineering analysis that was performed to analyze the costs of compliance with
the Phase 2 emission standards. This analysis also relies on the latter study and on the PSR and
D&B databases for data on handheld engine and equipment manufacturers. This information has
been supplemented with information received from engine and equipment manufacturers, trade
associations and from engine and equipment manufacturer websites.
To evaluate the impacts of the final rule on small entities, an economic measure known
as the "sales test" was used, which measures compliance costs as a function of sales revenue.
After determining the costs of compliance to the manufacturers, these costs are annualized and
expressed as a percentage of annual sales revenue. EPA's guidance for this is based on the per-
centage of small entities that are affected by costs of compliance amounting to varying
percentages of sales. Although there are a number of specific scenarios, the guidance provides
that if any number of small entities are affected by less than one percent of their sales income, or
if fewer than 100 small entities are affected by more than one percent of their annual sales
income, this does not amount to a "substantial number" of small entities.
The Small Business Administration defines small business by category of business using
Standard Industrial Classification (SIC) codes, and in the case of manufacturing, generally
defines small business as a business having 500 employees or less. However, for engine
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Chapter 8: Assessment of Impacts on Small Entities
manufacturers (SIC code 3519) the cutoff is 1,000 employees. Table 8-01 shows the range of pri-
mary SIC codes listed for the engine and equipment manufacturers identified, and the corres-
ponding SB A small business cutoff, based on number of employees.
Table 8-01
Small Business Engine and Equipment Manufacturer Definitions
SIC Code
3519
3523
3524
3531
3561
3621
Applicable
Engine
Equipment
Equipment
Equipment
Equipment
Equipment
Title
Internal Combustion Engines
Farm Machinery & Equipment
Lawn & Garden Equipment
Construction Machinery
Pumps and Pumping Equipment
Motors and Generators
Employees
1,000
500
500
750
500
500
8.2 Impact on Engine Manufacturers.
8.2.1 Small Business Engine Manufacturer Impacts
8.2.1.1. Identification of Manufacturers — The PSR database shows that there
are 22 primary handheld engine and equipment manufacturers. D&B financial data were
available for 20 of the 22. One of the remaining two appears to be a large multinational firm
which markets on five continents, and must be assumed to be large. The other will be assumed to
be small for purposes of this analysis. Under these assumptions, 17 of the 22 are large businesses,
many of which also manufacture nonhandheld engines. These firms account for almost 99
percent of the total estimated handheld engine production. Five are small entities, all of which
are also equipment manufacturers. Two of the five account for more than eighty percent of the
total estimated production for these small business entities. At least one of the small firms also
manufactures nonhandheld equipment. The Draft RIA stated that there were six engine
manufacturers that were small entities, however subsequent information regarding the resources
of the parent company of one of these has revealed that it is in fact a large manufacturer,
according to the SBA guidelines.
8.2.2 Expected Technologies/Costs
The cost of compliance for handheld engines depends on technology employed by engine
manufacturers to meet the emission standards, as well as on the standards themselves. Handheld
manufacturers employ a much higher percentage of two-stroke cycle engines than nonhandheld
manufacturers, which could increase the difficulty of compliance with the relatively more
stringent standards being finalized today. As noted in Chapter 3, EPA expects that most handheld
manufacturers will meet the new standards using improved two-stroke technologies such as
compression wave or stratified scavenging technologies, in most cases with the addition of a
catalyst. Such improved two-stroke technologies are under development to meet the California
Phase 2 standards, and catalyst technology has already been in use on some handheld engines to
meet the EPA Phase 1 standards. The Agency estimates that costs for these technologies will
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Chapter 8: Assessment of Impacts on Small Entities
range from about $23 per engine in Class HI, $20 per engine in Class IV, and $55 per engine in
Class V, depending on the type of technology and engine family production volume. These
figures include catalyst cost of $6.15 to $7.29 per engine for Class HI and IV engines.
Some handheld manufacturers may elect to convert to four-stroke cycle engines. Two
mini-four-stroke engines have recently appeared on the market, and a third is under development.
Although EPA expects that significant numbers of four-stroke engines will be used in meeting
the Phase 2 standards, the agency feels that it is unlikely that the five small-volume
manufacturers will be included in this group. Should one of them choose this strategy, EPA
estimates that the cost of converting a handheld engine two-stroke family to four-stroke would be
approximately $15 per engine plus any licensing costs involved, for the likely production levels
(based on the ICF cost study and other information that has come to the attention of the agency).
Also, as noted in Chapter 3, EPA has also become aware of other engine technology develop-
ments in the area of ignition and induction improvements that may assist two-stroke engines in
meeting the Phase 2 standards.
8.2.3 Expected Impact on Small Business Entities
To estimate impacts on engine manufacturers, specific compliance costs were developed
for each engine class, based on the type of engine modifications needed and the level of engine
production. Table 8-02 summarizes these costs. The individual annualized compliance costs were
then estimated for each small ultimate parent company identified. A more detailed technology
analysis is available Chapters 3 and 4, and in Appendix E.
Table 8-02
Engine Modifications and Associated Costs
Engine
Class
m
IV
V
Engine Modification
Compression wave technology*
Compression wave technology*
Stratified scavenge technology*
Compression wave technology
Fixed Cost
$688,000
$300,000-$688,000
$691,000
$300,000
Variable Cost Per
Engine
$22.43
$27.56
$23.00
* With catalyst. Catalyst cost is included in totals.
8.2.4 Sales Test for Engine Manufacturers
A compliance cost-to-sales ratio was calculated for each small ultimate parent company
for which D&B data were available. D&B data were available for four of the five small handheld
engine manufacturers. These manufacturers will likely achieve compliance with the new
standards through improvements to their existing engines, with the addition of catalysts in
Classes HI and IV. Under this scenario, the annualized costs of compliance for the two largest
firms, which account for 83 percent of the production for small business entities, amounted to
less than one percent and between two and three percent of sales, respectively. The costs of
compliance for two of the three smallest firms were calculated at one and 12 percent of sales,
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Chapter 8: Assessment of Impacts on Small Entities
respectively. Since D&B data were not available for the third manufacturer, it was not possible to
calculate a compliance cost in terms of percent of sales. However, this manufacturer has already
certified to California Phase 2 emission standards. EPA's analysis indicates that all three of these
smallest companies will qualify for the small-volume manufacturer flexibilities being finalized in
today's rulemaking. Compliance with the final standards therefore does not appear to represent a
"significant burden on a substantial number" of small entities.
8.2.5 Flexibilities Case
EPA is finalizing a number of small-volume flexibilities which can ease the burden of
compliance on the smallest entities. There are three major small-volume flexibilities being
offered to benefit the small engine manufacturers and small volume engine families. The
flexibilities for small volume engine manufacturers and small volume engine families are
summarized in Table 8-03. Small-volume engine manufacturers are defined as those
manufacturers which produce less than 25,000 units per year for handheld applications. Small-
volume engine families are defined as families consisting of less than 5,000 units for handheld
model lines.
Table 8-03
Summary of the Flexibilities for Small Volume Engine Manufacturers and Engine Families
Sector
Small Volume Handheld
Engine Manufacturer
Small Volume Handheld
Engine Family
Cutoff
25,000
5,000
Flexibility
1 . Allowed to produce "Phase 1 " engines until 3
years after Phase 2 standards are fully implemented
(i.e., through the 2008 MY for Classes IE and IV
and through the 2010 MY for Class V). The engines
will be excluded from ABT until they are certified
under the Phase 2 program.
2. Can certify using assigned deterioration factors.
3. Can opt out of PLT; SEA would be applicable.
They are the same as small-volume engine
manufacturer flexibilities noted above.
As noted above, all three of the smallest small-volume manufacturers could take
advantage of the small-volume manufacturer flexibility. In addition, the two larger small-entity
engine manufacturers could take advantage of the small engine family flexibilities for more than
half of their engine families. This would allow a more orderly transition to the new emission
standards and minimize the financial burden on these manufacturers. As a result, only one small-
entity engine manufacturer would be impacted by more than one percent of sales.
8.3 Impact on Equipment Manufacturers
8.3.1 Number of Small Manufacturers
With few exceptions, handheld equipment manufacturers are typically also the engine
manufacturers. The first exception to this rule consists of the small auger manufacturers. These
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Chapter 8: Assessment of Impacts on Small Entities
manufacturers rely upon the engines being produced in the marketplace. Since publication of the
January 1998 NPRM, six such auger manufacturers have been brought to the agency's attention.
The other exception is handheld equipment made by nonhandheld manufacturers. EPA has
identified an additional six manufacturers, including four lawn and garden and two paving
equipment producers. Total production for these twelve manufacturers is on the order of 65,000
units per year, out of a total handheld production of over ten million pieces of equipment.
Production for these manufacturers is limited to Class IV and V equipment, with two of them
manufacturing only Class IV equipment, seven manufacturing only Class V equipment, and the
remainder manufacturing both Class IV and V. In addition to the twelve small businesses, EPA
has also identified two equipment-only manufacturers that are not small entities.
8.3.2 Impact on Equipment Manufacturers
Because handheld equipment manufacturers are also often the engine manufacturers and
because of the relatively low number of handheld equipment lines, EPA estimates that the impact
on equipment manufacturers will be minimal. The handheld manufacturers will be afforded
ample lead time by the effective dates for the new standards, so that necessary engine changes
can be phased in together with normal equipment changes. Auger manufacturers and other
relatively low-volume manufacturers who do not also manufacture their own engines fear a
potential lack of availability of engines. Because of their relatively low production levels, the
auger manufacturers have expressed concerns that engine manufacturers would be reluctant to
make the necessary investment to develop compliant engines suitable for their particular
applications. Some have also expressed concerns that the power characteristics of a four-stroke
engine may not be suitable for the requirements of their particular applications. However, again,
EPA is providing flexibilities that should address these concerns and allow these relatively few
entities to continue production of their products.
8.3.3 Possibility of Cost Passthrough
Some manufacturers have expressed concerns that catalyst or other advanced tech-
nologies will necessitate price increases that will diminish the demand for their products.
However, EPA believes that the need for the products will likely remain, regardless of cost
increases—lawns will need care, construction will need to go on, etc. Then too, across-the-board
increases for SI engines will ultimately impact all equipment manufacturers equally so that no
manufacturer should gain a substantial competitive advantage. Individual small business
equipment manufacturers have informed EPA of the likelihood they would pass most, if not all,
additional costs on to consumers. Many of these small equipment manufacturers appear to cater
to niche markets, which provides an even better opportunity for partial or full cost passthrough.
8.4 Estimation of Impacts on Small-Volume Equipment Manufacturers:
8.4.1 Base Case—No Flexibilities
For the final standards, EPA calculated only the sales impact on the handheld equipment
manufacturers that were classified as small business entities. Cost estimates were calculated per
equipment model for each manufacturer. Each equipment model is assumed to correspond to an
application with a specific horsepower rating. To calculate an annualized cost of compliance for
each manufacturer, the fixed costs per model were multiplied by the number of equipment
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Chapter 8: Assessment of Impacts on Small Entities
models produced by that manufacturer. The fixed costs for each model were then annualized
using a seven percent annual cost of capital over a ten year period. The variable costs per unit
were multiplied by the number of units produced annually, yielding total annual variable costs.
These costs were then added to the annualized fixed costs to calculate the total annual cost per
manufacturer. The results were compared to total value of sales for the manufacturer to
determine the costs as a percentage of sales. The base case depicts a worst-case scenario, in
which none of the small-business equipment manufacturers take advantage of the flexibilities
provided for small-volume manufacturers or small-volume equipment lines.
Because there were relatively few manufacturers identified, and because of their low
number of models, the analysis concluded that the new standards would pose a minimal impact
on these small businesses. An analysis of the D&B data for the twelve equipment-only
manufacturers indicates that seven of the equipment manufacturers would be impacted by less
than one percent of sales, four would be impacted by between one and two percent of sales, and
only one would incur costs amounting to between two and three percent of annual sales.
However, the possibility remains that engine manufacturers may cease to produce engines
suitable for the low-volume auger and other applications. EPA is therefore providing flexibilities
for small equipment manufacturers and model lines in an attempt to mitigate this possibility.
8.4.2 Flexibilities Case
EPA is finalizing a number of small-volume flexibilities which can ease the burden of
compliance on these smallest entities. It should be emphasized that the flexibilities being adopted
for small-volume equipment manufacturers and small-volume equipment model models are for
equipment manufacturers only, and cannot be used by engine manufacturers who also manu-
facture equipment. (The flexibilities being adopted for small volume engine manufacturers and
small volume engine families were described earlier in section 8.2.5.) These small-volume
equipment manufacturer and small-volume model flexibilities are summarized in Table 8-04.
Small-volume equipment manufacturers are defined as those manufacturers who produce less
than 25,000 units per year for handheld applications. Small-volume equipment models are
defined as model lines consisting of less than 5,000 units for handheld model lines. Engine
manufacturers will be allowed to continue production of the engines necessary to satisfy the
demand from small volume equipment manufacturers and small volume equipment models.
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Chapter 8: Assessment of Impacts on Small Entities
Table 8-04
Summary of the Final Rulemaking Flexibilities
Sector
Cutoff
Flexibility
Small Volume Handheld
Equipment Manufacturer
25,000
May continue using Phase 1 compliant engines
through the third year after the last applicable phase-
in date of the final Phase 2 standards if the
equipment manufacturer is unable to find a suitable
Phase 2 engine before then (i.e., through the 2008
MY for Classes IE and IV and through the 2010 MY
for Class V).
Small Volume Handheld
Equipment Model
5,000
May continue to use Phase 1 compliant engines
throughout the time period the Phase 2 regulation is
in effect if no suitable Phase 2 engine is available
and the equipment is in production at the time these
Phase 2 rules begin to be implemented. If the
equipment is "significantly modified" then this
exemption ends, since design accommodations
could be made during such a modification to accept
an engine meeting Phase 2 standards.
Any Equipment
Manufacturer
Any
Any equipment manufacturer, regardless of size, for
any of its applications, regardless of size, may
continue using a Phase 1 engine for up to one more
year beyond the last phase-in of the final standard
for that engine class if the requirement to otherwise
use a Phase 2 compliant engine will cause
substantial financial hardship.
All but one of the 12 small equipment manufacturers will be able to take advantage of the
small- volume manufacturer flexibilities. However, the one small entity equipment manufacturer
that would not be able to utilize this flexibility would be impacted less than one percent of sales
by the new standards. This manufacturer would also qualify for the small-volume equipment
model flexibility for half of its product lines, with a corresponding reduction in the cost impact
on that producer. The 11 other small manufacturers could also qualify for the small equipment
model flexibility for all but three of their product lines, should they choose to take that route.
These flexibilities should help address the concerns expressed by the handheld auger manufac-
turers about the potential lack of engines. The equipment flexibilities would at least enable
continued production of the engines that are currently utilized for these applications. The recent
advances in two-stroke technology may also preclude the necessity for conversion to four-stroke
engines, which could also address many of their concerns about the unsuitability of such engines
for certain applications.
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Chapter 8: Assessment of Impacts on Small Entities
8.5 Conclusions
Analysis of the current data shows that the majority of engine and equipment manufac-
turing firms (representing almost 99 percent of handheld production) are not small business
entities. Of those that are, only three small engine manufacturers and five small equipment
manufacturers would be impacted by more than one percent of sales, even without taking
advantage of the flexibilities provided. If the small manufacturers do take advantage of the
flexibilities offered, only one engine producer would be affected by more than one percent of
sales, and none of the equipment manufacturers would be affected by more than one percent.
Moreover, there are other mitigating factors which could enter into the cost equation. The
inclusion of additional flexibilities, which will benefit both small engine and equipment
businesses, will further reduce possible adverse impacts. For example, it is possible for some of
the companies to be in a state of poor financial health, which would increase the compliance
burden placed on them. EPA will therefore allow handheld manufacturers to use the hardship
provision that was adopted in the Phase 2 small nonhandheld SI final rulemaking, which
provides additional relief to companies undergoing severe financial distress.
8.6 Outreach Activities
In addition to the comments received on the original January 1998 NPRM and the July
1999 SNPRM, EPA has made other outreach efforts. A number of small businesses were
contacted to determine the impact of the more stringent standards for handheld engines. In
addition, EPA has been in almost constant contact with engine producers, including the small
entities, at their own request or at the request of trade associations. Many of these firms who have
provided input to the process believe that sufficient lead time can alleviate some of the problems
associated with a transition to the advanced technologies expected under the Phase 2 regulations.
Additional lead time allows for a more orderly transition to this advanced technology when other
changes are made.
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Chapter 8 References
1. "Small Business Impact Analysis of New Emission Standards for Small Spark-Ignition
Nonroad Engines and Equipment," prepared for EPA by ICF Incorporated under EPA
Contract 68-C5-0010, August 1998, available in Docket A-96-55.
2. "Cost Study for Small Engine Emission Regulations," prepared for EPA by ICF
Incorporated under EPA Contract 68-C5-0010, October, 1996, available in Docket A-96-
55.
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Chapter 9: Useful Life and Flexibility Supporting Data
Chapter 9: Useful Life and Flexibility Supporting Data
9.1 Information on Useful Life
This chapter contains information used by the Agency in the development of the useful
life categories for Phase 2 small engines for handheld (Classes HI through V), Class I-A and
Class I-B.
During the development of the Phase 2 program, and during the development of the
Phase 1 regulation, EPA was aware that the nonroad SI category of engines and equipment was
comprised of a wide variety of equipment with a wide range of usage patterns. Handheld engines
are designed for many different types of applications, with each application having specific
design criteria. Within each application are a number of markets with different target life
expectancies. The most obvious example of these differences is the distinction between
commercial (or professional) operators and residential (or home) operators. In general,
commercial operators expect to accumulate high numbers of hours on equipment on an annual
basis, such as commercial lawn-care companies or rental companies, while a residential operator
expects to accumulate a relatively low number of hours on an annual basis, such as a residential
chain saw owner. Several organizations have investigated the issues related to average life and
annual use of equipment powered by Small SI engines, including industry organizations, C ARB,
and the EPA. A brief summary of several of these reports is presented in the remainder of this
Chapter.
9.1.1 Handheld Useful Life Estimates from PPEMA
In 1990 the Portable Power Equipment Manufacturers Association (PP EMA) contracted
for a report which contained estimates on useful life periods for two-stroke powered handheld
equipment.(Ref. 1) A summary of the information contained in the report on two-stroke powered
handheld equipment usage is presented in Table 9-01.
Table 9-01
Summary of Information on Useful Life
Available from Heiden Associates Report, July, 1990
Equipment
Tvoe
Chain saws
Trimmers &
Brushcutters
Hand Blowers
Back Blowers
Cut Off Saws
Hedge
Trimmers
Con.
Average
Annual Use
(hours^
7
10
9
12
N/A
7
Prof.
Average
Annual Use
(hours^
405
170
197
293
113
75
Con. User
Expected
Life
Estimates
(vears^
8
6
6.67
6.67
7.5
Prof. User
Expected
Life
Estimates
(vears^
1
1.5
2
1.83
2
3
%of
Equipment
Purchased by
Prof Users
25%
16%
5%
95%
100%
79%
Con. User
Expected
Life
Estimates
(hours^
56
60
60
80
N/A
53
Prof. User
Expected
Life
Estimates
(hours^
405
255
394
536
226
225
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Chapter 9: Useful Life and Flexibility Supporting Data
(Con. = consumer user, Prof. = professional user)
This report clearly demonstrates the large disparity between consumer and professional
use, with consumer equipment expected life estimates range from 53 to 80 hours, and
professional equipment expected life estimates range from 225 to 536 hours.
9.1.2 Handheld Useful Life Estimates from CARB
In 1990, the California Air Resources Board (CARB) contracted for a report from Booz,
Allen and Hamilton which included estimates of usage rates and life spans for several categories
of nonroad equipment powered by small engines(Ref. 2). A summary of the information
contained in the report pertaining to handheld applications is presented in Table 9-02.
This report also indicates there is a large disparity in average life-span between
equipment used by residential and commercial applications. Residential equipment implied
average lifespan estimates range from 35 to 127 hours, and commercial equipment implied
average lifespan estimates range from 274 to 784 hours.
9.1.3 Small Engine Equipment Usage Estimates used by EPA
The Agency has also developed estimates related to average annual use and equipment
survival, many of these estimates are based on the usage information in the previously cited
reports. These estimates were presented in the Small Engine Phase 1 Regulatory Support
Document.(Ref 3) The Phase 1 RSD includes Agency estimates of: average annual sales by
equipment type, percentage splits between residential and consumer equipment, average annual
use by equipment, B-50 (number of years after which 50 percent of the equipment have failed),
and sales splits by equipment between each of the five engine classes. Figures 9-01 through 9-03
are a series of bar graphs summarizing the Agency's information regarding engine classes and
hours of use.
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A
1
sauMrg g SSP/^ jvnuuyfo fuayja^
-------
Table 9-02
Summary of Information on Useful Life
Available from Booz, Allen & Hamilton Report, Nov. 1990
Product
Category
Tillers
Snowthrowers
General Utility
Two-stroke
blowers/
vacuums
Two -stroke
edgers/ trimmers
Chain saws
% of Total
Sales,
Home Use
60%
90%
25%
85%
85%
75%
% of Total
Sales,
Commercial
Use
40%
10%
75%
15%
15%
25%
Res.
Implied
Avg.
Lifespan
(years)
7.04
5.41
7.04
5.21
5.21
5.21
Com.
Implied
Avg.
Lifespan
(years)
5.41
5.41
2.85
2.85
2.85
1.33
Res.
Annual
Hrs Use
per Year
18
10
5
10
10
7
Com.
Annual
Hrs Use
per Year
72
60
96
170
275
405
Res.
Implied
Avg.
Lifespan
(hours)
127
54
35
52
52
36
Com.
Implied
Avg.
Lifespan
(hours)
390
325
274
485
784
539
(Res. = residential user, Com. = commercial user)
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*
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5
A
s
s;
1
I
I
13
I
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Chapter 9: Useful Life and Flexibility Supporting Data
Figures 9-01 thru 9-03 make it clear that small engines can accumulate vastly different
hours of use over the life of the equipment. Manufacturers are able to design and build engines
for various design lives which fit the type of equipment the engine is likely to be produced for.
9.1.4 Phase 2 Useful Life Categories
EPA is adopting several useful life categories for handheld engines (Classes in through
V), presented in Table 9-03. Based on the data presented in Sections 9.1.1 thru 9.1.4 the Agency
believes these useful lives are appropriate for regulatory purposes.
Table 9-03
Regulatory Useful Life Values for Small SI
Handheld Engines (Classes in through V)
Category
Useful Life (hours)
A
300
B
125
C
50
The Agency believes multiple useful life categories are appropriate considering the wide
range of useful life values for Small SI engines. At the same time, the Agency would like to keep
the number of useful life categories small to avoid confusion among consumers. The Agency
believes the three categories for handheld engines fulfils the goal of having a small number of
useful life categories, and at the same time, adequately covering the useful lives experienced by
engines in actual use.
For Class I-A engine families, the useful lives are the same as for Classes HI through V
since Class I-A families are just an extension of these engines to nonhandheld applications.
Class I-B engine families will utilize Class I useful life categories (125, 250, 500) since the
majority of engine families that will certify to this Class are already certified to Class I Phase 1
standards.
9.2 Background for Choice of Small-Volume and Small-Family Cutoffs
The Phase 2 rulemaking for handheld engines contains a number of flexibilities for small-
volume engine and equipment manufacturers as well as small-volume engine families and
equipment models. (The actual flexibilities are summarized in Table 9-04 at the end of this
chapter.) This section describes the methodology utilized to develop these estimates. The main
sources for this analysis include the September 1998 EPA Phase 1 certification database
(engine/equipment manufacturers) and Power Systems Research 1996 OE LINK database
(independent equipment manufacturers) along with the results from EPA's work to analyze the
impact on small businesses which can be found in Chapter 8.
9.2.1 Small-Volume Handheld Engine Manufacturers
The work performed to determine the impacts on small businesses, as described in
Chapter 8 of this RIA, utilized the SB A definition of 1000 employees as a cutoff for small-
volume engine manufacturers. Application of this definition to the range of engine
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Chapter 9: Useful Life and Flexibility Supporting Data
manufacturers in this industry resulted in identification of 6 small engine manufacturers. Only 5
of these companies were able to be analyzed, since both financial and estimated production
information are necessary for the analysis. An overview of the companies showed that they
varied greatly in income and production volumes. Two of the five companies were clearly small
with low number of employees and annual revenue. Due to production volume and number of
engine families produced, the sixth company could reasonably be assumed to be small as well.
However, three of the companies produced 75,000 to 700,000 engines and had very high annual
incomes. The high annual income and the high volume of engine production of some companies
raised doubt regarding the use of the SB A definition for developing small-volume manufacturer
cutoffs. EPA therefore consulted the Phase 1 certification database for its basis of a new
definition of small-volume engine manufacturer.
EPA reviewed the September 1998 Phase 1 certification database for the range of engine
manufacturers and their estimated annual production. EPA observed that there is a range of
volumes among the engine manufacturers for the handheld industry. The total projected sales
numbers are seen to be less than 25,000 for 6, 25,000 -35,000 for 2 engine manufacturers and
greater than 50,000 for the remaining handheld engine manufacturers. Based on this, the selected
production cutoff is listed in Table 9-04.
Table 9-04
Production Cutoffs for Small-Volume Engine Manufacturer
Handheld Engines 25,000 units
Application of these cutoffs to the September 1998 EPA Phase 1 database show that the
handheld definition will include 14 percent of the companies, but only 0.3 percent of the total
engine production.
9.2.2 Small-Volume Engine Family
Data utilized to determine small-volume engine families for the handheld sections of this
industry were from the EPA Phase I certification database.
The small-volume engine family cutoff for handheld engines is presented in Table 9-05.
A value of 5,000 is being adopted for handheld engine families, which is the same as
nonhandheld, as requested by EMA and PPEMA in comments to the January 1998 NPRM.
Table 9-05
Small-Volume Engine Family Definition
Handheld Engines
5,000
The result is that approximately 45 percent of total number of engine families in the
handheld industry could be considered small-volume engine families. While this may seem like
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Chapter 9: Useful Life and Flexibility Supporting Data
a large number of families, when one compares the number of engines represented by these
families and the total number of engines, only 1.74 percent of the annual production of Small SI
engines will be included in this definition.
Overall, the total engine production that will fall under the two definitions of small-
volume engine family and small-volume engine manufacturer amounts to only 1.77 percent of
the total production for the handheld industry as a whole.
9.2.3 Small-Volume Equipment Manufacturer
The 1996 Power Systems Research EO LINK database and information from various
equipment manufacturer associations and equipment manufacturer websites were utilized to
determine the cutoffs for small-volume equipment manufacturers (NOTE: This flexibility applies
for equipment manufacturers that do not make their own engines). Table 9-06 contains the cut
off for small-volume equipment manufacturers.
For handheld equipment manufacturers, the cutoff is 25,000 units, which is the same as
the small-volume engine manufacturer. The basis for this is that a review of the small-volume
equipment manufacturers (of which there are only 11), show this to be a reasonable cutoff in
order to provide manufacturers the flexibilities to change their production to use Phase 2 certified
engines. This provision affects 79 percent of the equipment manufacturers identified in the PSR
database or elsewhere as producing equipment with handheld engines. However, these small-
volume equipment companies utilize only about 0.3 percent of the total number of engines
produced each year.
Table 9-06
Small-Volume Equipment Manufacturer Cutoff
Handheld Units
25,000
9.2.4 Small-Volume Equipment Model
The cutoff for small-volume handheld equipment model (in which the equipment
manufacturer does not make engines as well) is presented in Table 9-07 and is 5,000 units/model.
The cutoff has been raised in response to comments on the July 1999 SNPRM. This flexibility is
expected to affect only one, or possibly two, manufacturers that would not also be considered
small-volume equipment manufacturers. Production data were not available for one large
multinational firm which markets on five continents, advertising itself as one of the largest lawn
and garden equipment manufacturers in Europe, and it will thus be considered a large volume
equipment manufacturer. However, even if all eight of this manufacturer's product lines were to
qualify for small-volume equipment model flexibilities, the resultant percentage of equipment
being allowed to utilize a Phase 1 engine would be a minuscule portion of the total annual
engine/equipment production.
There are a number of factors that will influence whether this definition is put to use by
137
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Chapter 9: Useful Life and Flexibility Supporting Data
equipment manufacturers. These include (1) the distribution system for engines and equipment
is complex and all engine families may meet the standards in order to have a nationwide engine
program, (2) the inability for engine manufacturers to pick who gets a "lower price engine" over
others, and (3) market pressure for a Phase 2 certified engine may result in less use of this
flexibility.
Table 9-07
Small-Volume Equipment Model Cutoff
Handheld Units
5,000
Table 9-08 summarizes the flexibilities included in the final rule. The flexibilities are for
handheld engine manufacturers and engine families only unless otherwise specified. Also, the
equipment manufacturer flexibilities are for those independent equipment manufacturers who do
not make engines for their own equipment.
138
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Chapter 9: Useful Life and Flexibility Supporting Data
Table 9-08
Summary of the Final Rulemaking Flexibilities
Sector
Cutoff
Flexibility
Small Volume Handheld
Engine Manufacturer
25,000
1. Allowed to produce "Phase 1" engines until 3 years after
Phase 2 standards are fully implemented (i.e., through the
2008 MY for Classes III and IV and through the 2010 MY for
Class V). The engines will be excluded from ABT until they
are certified under the Phase 2 program.
2. Can certify using assigned deterioration factors.
3. Can opt out of PLT; SEA would be applicable.
Small Volume Engine
Manufacturer for Classes IA
and IB
10,000
May elect to not participate in the PLT program, however, the
SEA program will still be applicable.
Small Volume Handheld
Engine Family
5,000
They are the same as small-volume engine manufacturer
flexibilities noted above.
Small Volume Engine Family
for Classes IA and IB
5,000
May elect to not participate in the PLT program, however, the
SEA program will still be applicable.
Small Volume Handheld
Equipment Manufacturer
25,000
May continue using Phase 1 compliant engines through the
third year after the last applicable phase-in date of the final
Phase 2 standards if the equipment manufacturer is unable to
find a suitable Phase 2 engine before then (i.e., through the
2008 MY for Classes III and IV and through the 2010 MY for
Class V).
Small Volume Handheld
Equipment Model
5,000
May continue to use Phase 1 compliant engines throughout the
time period the Phase 2 regulation is in effect if no suitable
Phase 2 engine is available and the equipment is in production
at the time these Phase 2 rules begin to be implemented. If the
equipment is "significantly modified" then this exemption
ends, since design accommodations could be made during such
a modification to accept an engine meeting Phase 2 standards.
Any Equipment Manufacturer
Any
Any equipment manufacturer, regardless of size, for
any of its applications, regardless of size, may continue using
a Phase 1 engine for up to one more year beyond the last
phase-in of the final standard for that engine class if the
requirement to otherwise use a Phase 2 compliant engine will
cause substantial financial hardship.
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Chapter 9: Useful Life and Flexibility Supporting Data
Chapter 9 References
1. "A 1989 California Baseline Emissions Inventory for Total Hydrocarbon & Carbon
Monoxide Emissions from Portable Two-Stroke Power Equipment", prepared by
Heiden Associates, Inc, for the Portable Power Equipment Manufacturers Association,
July 24, 1990. This report is available in Docket Item II-D-14.
2. "Utility Engine Emission Report", prepared by Booz, Allen & Hamilton Inc., for the
California Air Resources Board, November 20, 1990. This report is available in Docket
Item II-I-02.
3. "Regulatory Support Document, Control of Air Pollution, Emission Standards for
New Nonroad Spark-Ignition Engines at or Below 19 kiloWatts" US EPA, May 1995,
EPA Air Docket A-93-25, Docket Item V-B-1.
140
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APPENDIX A
141
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APPENDIX A: INDUSTRY CHARACTERIZATION
This Appendix discusses the structure of the industries producing engines and equipment
affected by this rulemaking. The industry characterization presented here is taken from a report
prepared under a contract work assignment for EPA by Jack Faucett Associates.(Ref 1) The
purpose of the work assignment was to prepare a report describing and analyzing the market
structure, conduct, and performance of the small nonroad engine and equipment industry and to
assess the technologies represented by the most common engines and equipment. The following
descriptions are excerpted from that report. Some sections which are excerpted are specific to
the Lawn and Garden Equipment Standard Industrial Code (SIC) 3524, although 11 SIC code
categories were analyzed in the report. The reason this section is focusing on the lawn and
garden equipment category is that most of the engines and equipment covered by this regulation
are in that category. (Note that this summary is from the time of the Jack Faucett Associates
report (December 1992) and has not been updated. Most information is still relevant, however
company specific information is outdated.)
[The small nonroad engine market is best described as a chain of industries
that: convert raw materials into components, engines, and equipment; distribute
the final product to end users; and, provide service and parts as required. The
establishment of regulation or alternative-market based regulatory approaches will
impact this chain of industries in a variety of ways. The structure of this chain,
and the characteristics of the industries that comprise it, will influence how
successful alternative control strategies will be in practice.
Figure 1 provides a schematic of the relationships and flow of goods for
engine manufacturers. To begin the process, raw materials and components are
purchased from suppliers. Necessary raw materials include the steel and
aluminum required to manufacture engine parts. The amounts and types of
purchased components will vary from one manufacturer to another. Some engine
manufacturers make their own parts, others purchase components. Die-cast molds
are used to forge parts. The finished parts and components are assembled into
engines on an assembly line.
Complete engines are sent to one of three places: equipment
manufacturers, distributors, or export markets. A great deal of engines are sold
directly to equipment manufacturers. In cases where engine manufacturers are
vertically integrated, these sales would be recorded as intra-company transfers.
Direct sales to equipment manufacturers is particularly common for high volume
consumer equipment and for technically demanding equipment for the
commercial market. The large volume engine manufacturers such as Briggs &
Stratton and Tecumseh sell directly to mass merchandiser equipment
manufacturers such as Murray Ohio Manufacturing and American Yard Products.
A-l
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Price and economies of scale51 are the primary factors of competition for engine
sales to mass merchandisers. For direct sales to equipment manufacturers
producing mid-range and premium priced equipment, engineering and design
cooperation is essential. In these cases, the engine manufacturers also work
closely with the equipment manufacturers to develop superior products.
For smaller equipment manufacturers, or for some of the cases where there
is no need for technical cooperation, it is usually not cost-effective for the engine
manufacturer to sell engines directly to the equipment manufacturer. In those
cases, engine manufacturers often ship engines to independent wholesale
distributors. As independent businesses, these distributors carry engines from
multiple manufacturers. The distributors then sell the engines to original
equipment manufacturers (OEM's) to be installed as product components.
Distributors also sell "loose" engines as replacement parts. Large-scale end-users
and dealers/retailers who provide service on used equipment are the most frequent
purchasers of replacement engines. Engines not sold to equipment manufacturers
or domestic distributors are shipped as exports.
In every segment of the utility industry, equipment manufacturers must
decide whether to use "two-tiered" distribution channels or to interface directly
with their dealer network. In a two-tiered distribution system, an independent
wholesale distributor acts as an interface between the equipment manufacturers
and the dealer network. Distributors add value by providing service to both the
equipment manufacturers and the dealer network. Distributors remove a great
deal of the inventory burden from dealers. Because dealers generally do not have
the facilities or financial strength to maintain large inventories, they must
frequently order parts for repair. Successful distributors can usually provide parts
within 24 hours. In the absence of a distributor, parts must be shipped from the
equipment manufacturers by package delivery services (such as UPS). This can
take several days or more, depending on manufacturer location and the availability
of the part. Furthermore, because many dealerships are small businesses, they
often rely on their distributors for bookkeeping and general business support.
Enhanced service provided by the distributors improves the reputation of the
equipment manufacturers. Also, distributors provide market information to
manufacturers because they are closer to the consumers and are often able to
identify emerging trends faster than the manufacturers themselves.
Despite the added value that distributors provide for both dealers and
manufacturers, they are declining in numbers and importance. This shift is
generally attributed to the ever increasing price competition in the consumer
marketplace. The value added by distributors must be offset by the profit margin
required by the additional tier in the distribution chain. Although distributors will
51 An economy of scale is said to exist when larger output is associated with lower
average cost.
A-2
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remain important, particularly for premium line equipment, their impact on the
market is projected to decline.
The distribution system for lawn and garden equipment manufacturers is
probably the most diverse and complex in the utility market. This is primarily due
to the different needs of the commercial and consumer markets. The bulk of all
lawn and garden unit sales go to consumer end-users.52 However, commercial
customers represent too large a market to ignore, and some equipment
manufacturers and members of the distribution chain focus strictly on the
commercial business. Balancing the commercial customers need for performance
and service with the consumer customers need for a low price is the challenge
facing manufacturers and the distribution channels they have developed.
Figure 2 provides a schematic of the relationships and flow of goods from
the viewpoint of the lawn and garden equipment manufacturers. These
manufacturers design and manufacture their own parts and/or purchase
components. The finished parts and components are assembled into end-user
equipment. Finished goods are sent to one of three places: wholesale distribution
dealers or other retail establishments, or shipped for export.
Some manufacturers use a direct (i.e., one-tier rather than two-tier)
distribution system, dealing directly with dealers or other retail establishments.
The larger the manufacturers and the larger the retail unit, the more likely that this
link will be direct. Mass merchandiser manufacturers deal directly with mass
merchant and discount retail outlets. Some manufacturers deal directly with all
types of retail outlets. The trend towards direct distribution is expected to
continue, as is the trend towards the mass merchandisers. These trends serve to
keep prices low, foster price based competition, and put a squeeze on distributors
and local dealers. The average service dealer makes $100,000 to $250,000 in
sales per year. There are 300 dealers that bring in over $1,000,000 in revenues
annually. There are also a great many dealers that have less than $100,000 annual
revenues. Dealers are extremely dependent on service revenue to stay in business.
Approximately 50 percent of the average dealers revenues are realized through
parts and repair work.53
As emission requirements force small nonroad engines to be more
complex, more will be expected of small engine technicians. The situation is
similar to automobile dealers who must perform vehicle emission compliance
work. Jeff Voelz, Marketing Director at Onan Corporation, noted that, "dealers
52 For example, OPEI estimates that 90 percent of walk behind lawnmower sales go
to the residential market.
53 North American Equipment Dealers Association.
A-3
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will have to get savvy and understand that this is their future."54 As in the
automotive industry, emission control advances are likely to reduce the user's
maintenance abilities and require an increase in small engine technician skills.
Although two-tier distribution is declining, it is still an important feature
of the distribution network. According to a survey of its members, OPEI found
that 41.4 percent of shipments were distributed through wholesale distributors in
1988. Many manufacturers use two-tier distribution for virtually every type of
retail establishment, although distributors are generally bypassed when shipments
go to mass merchandisers and discounters. Because of fierce price based
competition, the pressure is on distributors to prove their ability to add value in
order to maintain their volumes of business in the future.
Most manufacturers choose to focus on either the consumer or commercial
market. These factors, in turn, influence their choice of distribution channels.
Manufacturers that focus strictly on the consumer market, especially at lower end
prices, generally retail exclusively through mass merchandisers. Manufacturers
that focus strictly on the commercial market, generally rely exclusively on dealers.
Mid-range manufacturers and other manufacturers that wish to compete at the
commercial or top-end consumer market and the low-end consumer market face a
difficult choice. It is tempting to use both mass merchandisers (for sales volume)
and dealers (for value added service). However, this creates tremendous conflict
within the channels, particularly for the dealers. The dealers cannot match mass
merchandisers on price, and frequently end up as repair shops, merely servicing
the equipment that they can no longer sell. The solution to this situation that has
been most successful is to sell separate lines of products, restricting the mass
merchandisers from selling the higher quality product lines. McCullough has
been able to do this successfully. Toro tried to do this, but eventually withdrew
from mass merchandiser outlets. Toro is now trying the mass merchandisers
again with its Lawnboy subsidiary.
This discussion of lawn and garden manufacturer distribution channels
primarily addresses nonhandheld equipment manufacturers, although, in general,
it applies to handheld equipment manufacturers as well. There are, however,
some unique facets of the handheld manufacturers distribution networks that have
not been previously addressed. The major difference is that the handheld
manufacturers all make their own engines. This changes the mixture of raw
materials and components they purchase as well as their manufacturing and design
processes. A separate engine market would not suffice for handheld
manufacturers because of the size, performance, and design restrictions placed on
their products by the unique end-user requirements for handheld equipment.
There are only a handful of nonhandheld equipment manufacturers that are
54 Phone conversation on June 8, 1992.
A-4
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vertically integrated. Kubota is an example of a major manufacturer of both
engines and equipment. (Ref. 2)
The Lawn and Garden Equipment Industry (SIC 3524) accounted for 0.11
percent of GDP in 1990.... Constant dollar shipments have increased sharply, with
a 33.1 percent increase from 1984 to 1990.... [RJoughly the same number of
companies were responsible for the increased out, indicating that new firms
entering the industry may not have been responsible for higher output. Value
added as a percent of output for the industry in 1990 was 40.9 percent, roughly the
same as the internal combustion engine industry.
This industry does not seem to be capital intensive, as assets were only
18.8 percent of output in 1990, less than the corresponding percentage for All
Manufacturing Industries.... In addition, capital turnover rates are 15.6 years,
slightly above the average for All Manufacturing Industries. As a result, should
regulation result in new purchases of capital, the industry may not have as much
difficulty as other industries in adapting to regulatory actions.
Concentration in this industry is high, as the 8 largest companies control
71 percent of the market. These companies may have the ability to influence the
price of their products. Yet the industry does not seem to have excess capacity,
with a capacity utilization rate of 73 percent. This figure is slightly less than the
76 percent rate for All Manufacturing Industries....
Because the Statistics of Income Classification code relevant to the Farm
Machinery and Equipment industry includes both 4-digit SIC codes 3523 and
3524, the profitability analysis for the Farm Machinery and Equipment industry
also applies to the Lawn and Garden Equipment industry. For 1988, profitability
for this industry seemed quite good, with the average return on equity up to 17.9
percent, a 14.1 percent increase from 1990. The average debt to asset ratio,
however, is among the higher of the seven minor industries considered... at 42
percent.
Constant dollar shipments are expected to grow at an annual rate of 2
percent over the next 5 years for the Lawn and Garden Equipment industry. The
U.S. Industrial Outlook attributes this increase to several factors, first among them
are demographic changes in the U.S. population. In particular, the fastest growing
age group, 44-54, will be near their maximum earning potential, which should
result in larger expenditures on lawn and garden equipment. The report also notes
that many of these consumers will be more inclined to upgrade their current
properties, which may entail landscaping. The removal of trade barriers in
Mexico and Canada as a result of the North American Free Trade Agreement
(NAFTA) should give companies in the three North American countries the
opportunity to expand their exports. In addition, the report mentions that possible
environmental standards may have an impact on sales, but the report does not give
a clear indication of whether or not these regulations will cause sales to increase
A-5
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or decrease.(Ref. 3)
[MJany of the eleven 4-digit SIC industries encompassing the small
nonroad engine and equipment industry are characterized by significant value
added, fairly high concentration, growth in the value of shipments, capital intense
production processes, high capital turnover, and relatively efficient capacity
utilization. These basic industry trends determine the competitive nature of the
industry and condition the interactions of the firms that form these industries with
suppliers, consumers and each other.(Ref. 4)
[The competitive features of the small nonroad engine and equipment
industry have been reviewed. These features include: channels of product
distribution, the levels of vertical and horizontal integration across engine and
equipment manufacturers supplying the nonroad engine and equipment industry,
the types and extent of barriers to entry that may exist in this industry, the degree
of market power inherent in the nonroad engine and equipment industry at various
levels of producer interactions, the availability and importance of substitute power
sources for these engines, the global competitive position of U.S. firms in this
industry, and characteristics of end-users which drive the demand for the various
products that are sold in the small nonroad equipment industry. Such a
comprehensive description of this industry's competitive features has revealed
various interesting results which should be summarized.
First, the level of vertical integration in the small nonroad engine and
equipment industry appears to be rather small. Where present, vertical integration
is concentrated in three areas of the industry: foreign lawn and garden engine and
equipment manufacturers, foreign recreational engine and equipment
manufacturers, and handheld lawn and garden engine and equipment
manufacturers. For example, Honda produces both the engine and equipment
components of their lawn and garden products... In fact, most of the vertically
integrated companies are foreign companies.
Horizontal integration, on the other hand, is common among engine
manufacturers in the small nonroad engine and equipment industry. This follows
directly from the fact that a single engine design is often used in many small
nonroad equipment applications.... [T]ecumseh and Briggs & Stratton engines,
for example, are employed by various types of equipment including lawn and
garden equipment, light commercial and industrial equipment, light agricultural
equipment, and others.
Second, advertising and product differentiation, economies of scale, and
large capital requirements appear to be the only forms of barriers to entry that may
characterize the small nonroad engine and equipment industry. However, the
effectiveness of these phenomena is difficult to assess. Nevertheless, advertising
plays an important role in the lawn and garden equipment industry, as shown by
its relatively high advertising intensity ratio. Similarly, product differentiation is
A-6
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important in this market as evidenced by the large number of brands and product
models that are offered for different equipment types, such as lawnmowers or
chainsaws...
Economies of scale and large capital requirements, on the other hand, are
likely to be more important at the engine manufacturing level of the industry,
since this level is capital intensive and characterized by few dominant sellers....
...[O]ne general characteristic of the industries that comprise the small
nonroad engine and equipment industry is high levels of seller concentration.
Empirically, high seller concentration has been shown to perpetuate product
pricing that is above the marginal cost of the products production.(Ref. 5)...
[R]esults that are characterized by this pricing outcome are economically
inefficient, and display the market power, of at least the market leaders, in the
industry. However, although the small nonroad engine and equipment industry is
generally characterized by seller concentration,... the various relationships
between the economic agents operating in this industry are not characterized by
significant levels of market power. Much of the reasoning behind this conclusion
centers on the concept of contestable markets... The fact that the small nonroad
engine and equipment industry is not characterized by market power implies that
if regulatory actions increase the production costs of the firms producing in this
industry, then these incremental costs will likely be passed on to consumers, or
end-users, in the form of higher prices. Moreover, the likelihood that market
power is not prevalent in the small nonroad engine and equipment industry
implies that economic profits are not being accrued in the long run. This in turn
suggests that entry into the market is relatively free. Although some aspects of
barriers to entry may exist (such as product differentiation, advertising, and
economies of scale), their effectiveness at deterring entry is not necessarily
evident.
Fourth, the prevalence of substitute power sources and equipment that
displace equipment powered by internal combustion engines is most evident in the
lawn and garden equipment market where electrically powered machines have
been common for many years. However, the sale of electrified lawn and garden
equipment is hampered by various factors. For example, the long extension cords
necessary for the operation of electrified equipment are cumbersome, while
electrified lawn and garden equipment are generally not a viable option for
commercial users. However, use of battery packs could potentially resolve some
of the detrimental user oriented externalities associated with electrically powered
lawn and garden equipment (Ref. 6).
A-7
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A-8
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Appendix A References
1. Jack Faucett Associates, Small Nonroad Engine and Equipment Industry Study, JACKF AU-
92-413-14, December 1992
2. ibid, pages 68-76
3. ibid, pages 57-58
4. ibid, p. 67
5. Curry, B., George, K.D., Industrial Concentration: A Survey., The Journal of Industrial
Economics, March 1983
6. Jack Faucett Associates, Small Nonroad Engine and Equipment Industry Study, JACKF AU-
92-413-14, December 1992, p. 123-126.
NOTE: Graphs not included in this electronic version
A-9
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A-10
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Appendix B: Manufacturer and Product Summary
B.I. Introduction
This appendix summarizes information on the equipment related to the category of
engines regulated, nonroad handheld spark-ignited engines 19 kW or less. This appendix
summarizes the engine manufacturers and their products, the technology used on these engines,
and estimates the amount of these engines consumed in the United States.
B.2. Engine Manufacturer Summary
There are a wide variety of engine manufacturers producing engine products which will
be regulated. Data on the manufacturers and their products is provided from EPA's Phase 1
certification database55.
B.2.1. Listing of Known Engine Manufacturers
EPA has generated a listing of engine manufacturers from the September 1998 EPA
Phase 1 certification database. It appears that there are 22 manufacturers which produce two-
stroke engine families and three manufacturers which produce four-stroke engine families.
B.2.2. Listing of Known Engine Models per Manufacturer
The EPA Phase 1 database contains the most extensive listing of information at the
engine model level. The data in this section is excerpted from this database. Presented in
Table B-01 are the number of engine models per manufacturer and the estimated number of
engine models in each standard category.
B.2.2.1. Number of Engine Models- Table B-01 shows that there are 186 engine
models in Classes in through V. There are nine manufacturers of handheld engines who
produce less than five engine models. The more engine models a manufacturer produces does
not correlate to overall more engine sales. Some engine manufacturers are specialized and serve
a number of specialty markets.
B.2.2.2. Engine Family and Emissions Per Engine Family Per Class - Tables B-02
through B-04 contain information per engine family per manufacturer on engine family, new
engine emissions (HC, NOx, CO), emission control technology, major applications and
displacement.
Since the Phase 2 regulation is an in-use set of standards, the new engine values from the
September 1998 Phase 1 certification database have been deteriorated to compare to the new
engine standard. Deterioration factors were taken from data submitted by industry and EPA's
own analysis. Table B-05 lists the deterioration factors applied to the corresponding engine
families.
55 All engine models for production in the 1997 model year were to be certified by
September 1, 1997. The only exception are those models that are exempt from
CARB's Tier 1 program (Class V engines) which have until January 1, 1998.
-------
Table B-05
Deterioration Factors
Engine Class
four-stroke OHV
two-stroke
two-stroke w/ Catalyst
m
HC/NOx
~
1.1/1.0
—
IV
HC+NOx or
HC/NOx
1.5
1.1/1.0
1.3
V
HC/NOx
—
1.1/1.0
—
B.3. Estimate of Historical and Future Equipment Consumption (Sales)
Information on the estimate of historical sales is summarized in this section. Historical
data came from EPA's analysis of the information from the PSR database as well as information
from Outdoor Power Equipment Institute (OPEI), the Portable Power Equipment Manufacturers
Association (PPEMA), and a study done for the California Air Resources Board by Booz, Allen,
Hamilton (BAH). Data presented in this section show the estimates of historical consumption
from these sources. This information was used in EPA's check of the 1996 population estimates
being used in the NONROAD model. The information on future equipment consumption is
described in Chapter 6.
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Table B-01
Engine Manufacturers and Engine Families Per Class and Engine Type
September 1998 EPA Phase 1 Certification Database
MANUFACTURER
Emak s.p.a.
Fuji Heavy Industries, Ltd.
Fuji Robin Industries
Honda
Husqvarna AB
Ishikawajima Shibaura Machinery Co.
John Deere Consumer Products, Inc.
Kawasaki
Kioritz
Kioritz-Echo
Komatsu-Zenoah
Makita USA, Inc.
Maruyama US Inc.
Mitsubishi Engine North America, Inc or
Mitsubishi Motors Corporation
Poulan
Ryobi
Shin-Dai wa Kogyo Co. Ltd
Solo Incorporated
Stihl
Tanaka Kogyo Co. Ltd
Tecumseh
Wacker-Werke GmbH&Co KG.
TOTALS
HANDHELD
III
2-S
1
1
1
3
2
8
IV 4-
S
2
1
3
IV
2-S
4
1
2
11
4
8
7
8
10
7
7
7
2
10
3
13
1
12
1
1
119
V
2-S
4
4
1
16
2
1
8
1
1
11
3
1
53
V
4-S
1
2
TOTAL
8
6
4
4
27
4
11
8
8
10
8
15
7
9
14
4
13
2
23
3
4
1
186
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APPENDIX C
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APPENDIX D
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APPENDIX E
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APPENDIX F
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