EPA and NHTSA  Propose Changes to
                  the Motor Vehicle  Fuel  Economy Label
                      The U.S. Environmental Protection Agency (EPA) and the
                      National Highway Traffic Safety Administration (NHTSA) are
                  redesigning the fuel economy label consumers see on the window of
                  every new vehicle in dealer showrooms. The agencies are proposing
                  two different label designs and are asking for input from all Americans
                  on which redesigned label is the most informative to them as they
                  make purchasing decisions.

                  Regardless of whether EPA and DOT select one of the two labels
                  proposed today or adopts a modified version following the public
                  comment process, the goal of the new label will be the same: to
                  provide consumers with simple, straightforward comparisons across all
                  vehicles types, including electric vehicles (EV), plug-in hybrid electric
                  vehicles (PHEV), and conventional gasoline and diesel vehicles.

                  These proposed changes represent the most significant overhaul of
                  the federal government's fuel economy label since its inception over
                  30 years ago. Beginning with model year 2012 cars and trucks,
                  the redesigned label will provide American consumers with new
                  information on fuel economy, energy consumption, fuel costs, and
                  environmental impacts associated with their new vehicles. The
                  agencies will also develop new labels for certain advanced technology
                  vehicles that will soon be mass-marketed, such as plug-in hybrid
                  electric vehicles (PHEVs) and electric vehicles (EVs).

                  NHTSA and EPA are proposing these changes because
                     ^ the Energy Independence and Security Act of 2007 specifically
                       calls on EPA and DOT to rate available vehicles according to
                       fuel economy, ghgs and smog forming pollutants.
SEPA
United States
Environmental Protection
Agency
Office of Transportation and Air Quality
               EPA-420-F-10-048a
                   August 2010

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       advanced technology vehicles, which will be widely available soon, need
       labels that tell consumers what they need to know about their fuel/energy
       use; and
       improved information content and display can help consumers make
       more informed decisions when purchasing vehicles.
Label Design Options and New Information
EPA and NHTSA are coproposing two label designs. Both labels meet legal requirements and
rely on the same underlying data; they differ in how the data is used and presented. The agen-
cies encourage public feedback on which label design would provide better information to help
consumers more easily assess the energy use, costs, and emissions of different vehicles and make
fully'informed decisions when purchasing a new vehicle.

Label 1: This label design prominently features a letter grade (A+ to D) to communicate the
overall fuel economy and greenhouse gas emissions, and the 5 year-fuel-cost savings compared
to an average vehicle (see figure 1). The letter grade is technology- and fuel-neutral; that is, a
vehicle can earn any letter grade regardless of vehicle technology or fuel type, as long as it meets
the specified greenhouse gas/fuel economy levels.

Label 2: This label design is more traditional and retains the current label's focus on fuel econo-
my and annual fuel cost projections, with a layout similar to the current label (see figure 2),

Both options add to the content found on the current label and include the following informa-
tion  for gasoline and diesel vehicles:
    Fuel Economy: City and highway miles per gallon (mpg) and a slider bar comparing
      vehicle's fuel economy to that of all other vehicles
    Fuel Consumption: Combined city/highway gallons per 100 miles
    Greenhouse Gases: Tailpipe carbon dioxide (CO2) emissions in grams per mile and a
      slider bar comparing the vehicle's CO2 emissions to those of all other vehicles
    Other  Emissions: A slider bar comparing a vehicle's smog-related emissions to those of
      all other vehicles
    Fuel Cost: Estimated annual costs of fueling the vehicle
    Comparable Fuel Economy: A comparison of the vehicle's fuel economy to that of
      comparable vehicles
    Smart  phone interactive tool: A symbol that smart phones can read for additional
      consumer information (also known as a QR  code)

The  advanced technology vehicle labels contain additional information tailored to these tech-
nologies (see figures 3 and 4), including:
    Driving Range: Identifies how many miles electric vehicles (EVs), plug-in hybrid electric
      vehicles (PHEVs), and compressed natural gas (CNG) vehicles can go before recharging
      or refueling,
    Different Modes: Some vehicles,  such as plug-in hybrid-electric vehicles, have different
      operating modes -- all-electric, blended, and gasoline-only. The labels provide fuel
      economy information for each distinct operating mode.

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    Energy Consumption Measurement: For EVs, the label shows energy use via both a
     miles per gallon of gasoline-equivalent (mpg-e) and kilowatt-hours per 100 miles metric;
     PHEV labels show only the mpg-e metric. Mpg-e converts kilowatt-hours of electricity
     to gallons of gasoline based on energy equivalency.
                  EPA
                  DOT
Fuel Economy and
Environmental Comparison
                   The above grade reflects fuel
                   economy and greenhouse gases.
                   Grading system ranges from A+ to D.
                    website, here
                   Over five years, this vehicle
                   saves* 1,900
               in fuel costs
               compared to the
               average vehicle.
                        Gasoline Vehicle
                  Gallons/
                  100 Miles
                   3.8
MPG
City
22
 MPG
Highway
 C02 g/mile
(tailpipe only)
 32     347   $1,617
Annual
fuel cost
                  ffffiM
                    Combined MPGe
                                   COzg/mile
                                              Other Air Pollutants
                   Fuel economy for all SUVs ranges from 12 to 32 MPG.
                   Annual fuel cost based on 15,000 miles per year at $2.80 per gallon.
                  Visit website.here \o calculate estimates
                  personalized for your driving, and to      ,.
                  download the Fuel Economy Guide (also    Is":
                  available at dealers).
          Figure 1. Label Option 1  Gasoline and Diesel Vehicles
Note that the grade "B" is an example only. Gas/diesel vehicles can earn any grade, based
                   on their greenhouse gas/fuel economy levels.

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  EPA  Fuel  Economy and
  DOT  Environmental Comparisons
     r\  o f* MPG
     "26   22  32
          combined city/hwy  city    highway
               gallons used every 100 miles
                    Gasoline Vehicle
Annual Fuel Cost
*1,617
  How This Vehicle Compares
  Among all vehicles and within SUVs
 Environment
                                                 (COj g/mile, tailpipe only)
                                                           Smartphone
                                                           Interactive
                                                           Scan code for more
                                                           information about this
                                                           vehicle or to compare
                                                           it with others.
             Figure 2. Label Option 2  Gasoline and Diesel Vehicles
To view the proposed label designs for electric and plug-in electric vehicles, please visit our
website at: www.epa.gov/fueleconomy/label.htm
Advanced Technology Vehicles
In the past, over 99 percent of all new vehicles have operated on petroleum fuels (e.g., gasoline,
diesel, or a mostly-petroleum-based fuel blend) and the current fuel economy labels were de-
signed for these gasoline and diesel vehicles.  Labels for vehicles not fueled by petroleum cur-
rently are addressed on an individual basis.

The future automotive market will most likely offer consumers vehicles that are run on alternate
energy sources, and many of these new technologies raise new issues in terms of consumer infor-
mation and vehicle labels. Electric vehicles and plug-in hybrids will soon enter the marketplace
in significant numbers. Because these vehicles will use electricity from the grid, the familiar
metric of miles per gallon of gasoline no longer applies. The agencies' goal was to design simple,
objective labels that allow consumers to easily compare all types of vehicles. The agencies are
proposing various label options and are requesting that the public weigh in on their clarity and
usefulness.

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Electric Vehicles (EVs)
For electric vehicles (EVs), which operate solely on electricity, the agencies are proposing to
include both kilowatt-hours per 100 miles and miles per gallon of gasoline-equivalent (electric-
ity consumption translated into mpg). The use of kilowatt-hours would reflect the way in which
electricity is sold, similar to the information given on a utility bill.  In this case, a lower number
is better.  Miles per gallon of gasoline-equivalent converts kilowatt-hours of electricity into gal-
lons of gasoline (based on 33.7 kilowatt-hours per gallon), and reflects the more familiar mpg-
type approach for a fuel that is very different from gasoline. In this case, a higher number
is better.

The agencies  are also proposing to show how far EVs can travel on a full battery charge. For
EV CO2 emissions, the agencies propose to show tailpipe-only emissions, which means that EV
label CO2 emissions will be zero, given that all of the CO2 emissions associated with EV opera-
tion occur at the power plant and other upstream sources.

The agencies also plan to develop a web-based tool that will allow consumers to determine the to-
tal upstream CO2 emissions from electricity (production and distribution) that results from charg-
ing an EVs  battery. The agencies also ask for comments on whether to include upstream CO2
emissions, battery charging time and driving range of EVs on the label. To view the proposed
label designs for electric vehicles, please visit our website at: www.epa.gov/fueleconomy/label.htm
Plug-in  Hybrid Electric Vehicles (PHEVs)
PHEVs can run on:
    1. batteries and electric motors that are plugged in to charge;
    2. a combination of both gasoline and plug-in electric operation; and
    3. gasoline only, like a conventional hybrid vehicle.

Depending on how they are designed, PHEVs can operate in two or three of these operating
modes.  Because of these design choices, PHEVs are the most complex technology for a
vehicle label.

For PHEVS, the agencies propose to provide as much information as  possible about each operat-
ing mode (all electric, blended, and gasoline-hybrid only). This allows consumers to tailor the
information about each operating mode to their own driving habits.  Because there  are up to
three PHEV operating modes, the agencies had to make choices on how much information to
display on a  PHEV label.

For example, the agencies propose to display energy consumption only in terms of miles per gal-
lon of gasoline-equivalent (mpg-e).  The mpg-e converts kw-hr of electricity to gallons of gaso-
line based on energy equivalency (33.7 kilowatt-hours per gallon).  On some of the proposed
PHEV labels, average nationwide driving profiles are used to determine the relative electricity
versus gasoline consumption in order to calculate a single overall value for parameters, such as
CO2 emissions and annual fuel cost. The agencies seek comment on alternative metrics for
PHEVs. To view the proposed label designs for plug-in electric vehicles, please visit our website
at: www.epa.gov/fueleconomy/label.htm

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Other Technologies
The labels proposed for other technologies now on the market, such as ethanol flexible fuel
vehicles and compressed natural gas vehicles, are based on refinements to gasoline and diesel
vehicle labels.
Fuel Savings or Costs
Label 1 shows the calculated fuel cost savings over a 5-year period for a specified vehicle com-
pared to the average vehicle for that model year. (EPA will use current model year data to
estimate the fuel economy for the subsequent model year's average vehicle, not sales-weighted.)
If the labeled vehicle would save the consumer money over the average vehicle, the labeled
vehicle would state, "Over five years, this vehicle saves xxx in fuel costs compared to the average
vehicle." If the labeled vehicle would be more expensive to operate than the average vehicle,
the label would state, "Over five years, you will spend xxx more in fuel costs compared to the
average vehicle."

Both Label 1 and 2 show the associated annual fuel cost for the specific vehicle as required un-
der the Energy Policy and Conservation Act. This estimated cost is based on 15,000 miles per
year and gasoline price of $2.80 per gallon.
Fuel Consumption Information
While a miles per gallon estimate is required for fuel economy labels and has appeared on the
label for several decades, the agencies have some concern that it can be potentially misleading
for comparing fuel economy improvements, particularly when it is used in place of fuel costs.
The following chart shows the non-linear relationship between gallons used over a given
distance and miles per gallon. The fuel savings, in gallons, for a vehicle that gets 10 mpg versus
a vehicle that gets 15 mpg is about 33 gallons (assuming 1000 miles). On the other hand, the
fuel savings in gallons, for the same 5 mpg fuel economy jump, for a 30 mpg versus a 35 mpg
vehicle is only about 5 gallons (see  figure 3),

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                             Illustration of "MPG Illusion"
     150
                     10
                            15
                                   20      25      30
                                    Miles per Gallon
                                                        35
                                                               40
                                                                      45
                                                                            50
                   Figure 3.  Demonstration of the "mpg illusion."
This "mpg illusion" demonstrates why it may be more meaningful to express fuel efficiency in
terms of consumption (e.g., gallons per mile or per 100 miles) rather than in terms of economy
(miles per gallon). A consumption metric would allow for more accurate energy usage compari-
sons among vehicles.
Rating for Fuel Economy and Greenhouse Gases
The cO'proposed labels show different ways to provide comparison ratings for fuel economy and
greenhouse gases. One approach shows a rating for fuel economy and separate rating for green-
house gases (see figure 4). This ratings system is displayed at the bottom of Labels 1 and 2 and
uses a comparison slider bar. The bar is anchored at each end with the lowest and highest val-
ues expected for all vehicles in the model year, and uses a pointer to display the specific vehicle
model's location on the  scale.

The alternative approach uses a rating that combines fuel economy and greenhouse gases into a
letter grade (see figure 4).  This approach consolidates information for consumers and provides
an easy-to-understand metric that purchasers can quickly use to compare the fuel economy and
greenhouse gas values across all vehicles.

Both ratings are not mutually exclusive, and a label could contain one or both.

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Letter Grade
Rating
(Combined
Rating)
A+
A
A-
B+
B
B-
C+
c
c-
D+
D
CO Range (grams per
mile) (Separate Rating)
0-76
77-152
153-229
230-305
306-382
383-458
459-535
536-611
612-688
689-764
765-842
and higher
Gasoline MPG
Equivalent (Separate
Rating)
117 and higher
59-116
40-58
30-39
24-29
20-23
18-19
16-17
14-15
13
12 and lower
          Figure 4.  Examples of ratings systems.
The proposed letter grade scale would range from A+ to D, including plus and minus designa-
tions. The agencies base this rating system approach on the range of CO2 emissions for the
projected fleet, first determining the middle point (or median) for all model types, then generat-
ing five equal increments of CO2 above and below this middle point. Each increment is assigned
a grade or rating.

For those vehicles that run on electricity, the tailpipe emissions are zero. Of course, these ve-
hicles do cause emissions at the electric generation facility, with amounts varying greatly based
on the source of electricity (such as coal, nuclear, natural gas, hydro, or wind).  The agencies
intend to make this information available on the web, with calculators that people  can use to
determine their upstream emissions (from the production and distribution of electricity) based
on where they live and the vehicle they are considering.

Most vehicle classes are expected to span multiple ratings.  For example, using the letter grade
system and MY2010 data, the agencies project the ratings distribution by vehicle class shown in
figure 5. The majority of vehicles are expected to fall into the middle of the grade, as shown in
figure 6,

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A+ A
small car 1 2
nidsizecar
argecar
ninivan
Dickup
station wagon
SUV
\/an
A- B +
8 71
6 5



12
8

B
215
79
11
2
2
75
68

B-
306
92
31
9
30
65
167

C +
79
43
41
18
56
12
166
4
C
57
6
10

52

68
2
C-
30
8
13
2
9

45
10
D +
2

6



4

D

2






          Figure 5.  Distribution of vehicle types across the rating system
                       (number of models in each category).
                  Rating Distribution
                                           697
                D    D+   C-    C    C+   B-    B    Bi    A-    A    A+
        Figure 6. Distribution of the current fleet across the rating system
                               (number of models).
Rating for Other Emissions
The labels also include a rating for those pollutants that cause smog and other local air pollu-
tion. This information, listed as "Other Air Pollutants" on the labels, will be displayed using a
slider bar with a scale of 1 (worst) to 10 (best). The scale is based on Federal Tier 2 emissions
standards and Bin system, which incorporates specific standards for nitrogen oxide (NOx), non-
methane organic gas (NMOG), carbon monoxide (CO), particulate matter (PM), and formal-
dehyde (HCHO). The scale mirrors the current Air Pollution scoring system on EPA's Green
Vehicle Guide (www.epa.gov/greenvehicles/Aboutratings.do#aboutairpollution ),

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Public Participation Opportunities
We welcome your comments on this rule. Comments will be accepted for 60 days beginning
when this proposal is published in the Federal Register. All comments should be identified by
Docket ID No. EPA-HQ-OAR-2009-0865 and submitted by one of the following methods:

          Internet:  www.regulations.gov
          Mail:
             Environmental Protection Agency
             Air and Radiation Docket and Information Center (6102T)
             1200 Pennsylvania Avenue NW
             Washington, DC 20460
          Hand Delivery:
             EPA West building
             EPA Docket Center (Room 3340)
             1301 Constitution Avenue NW
             Washington, DC

You should consult the Federal Register notice for this proposal for more information about how to
submit comments, when the comment period will close, and about where and when public hear-
ings will be held. A copy of Federal Register notice can be found on our websites listed below,

For More Information
You can access the rule and related documents on EPA's Office of Transportation and Air Quality
(OTAQ) website at:
          www.epa.gov/fueleconomy/regulations.htm

To view all the proposed label designs, please visit our website at:

          www.epa.gov/fueleconomy/label/label'designs.pdf

For more information on this rule, please contact Kristin Kenausis at:

          U.S. Environmental Protection Agency
          Office of Transportation and Air Quality
          1200 Pennsylvania Ave., NW (6406J)
          Washington, DC 20460
          (202) 343-9225
          E-mail: kenausis.kristin@epa.gov
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