U.S. Department of Transportation Research and Special Programs Administration	Draft Environmental Assessment

National Highway Traffic
Safety Administration
Corporate Average Fuel
Economy (CAFE) Standards

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1. AGENCY USE ONLY (Leave blank)		2. REPORT DATE December 2002		3. REPORT TYPE AND DATES COVERED May 2001 - December 2002
4. TITLE AND SUBTITLE National Highway Traffic Safety Administration - Corporate Average Fuel Economy (CAFE) Standards. Draft Environmental Assessment					5. FUNDING NUMBERS SA20T/S3068
6. AUTHOR(S) Jon Anderson3, Kevin Green2, Kristina E. López-Bernal2, José G. Mantilla2, Robert Marville3, Jennifer Papazian2, Don H. Pickrell2, Paul Valihura2, Roger Wayson4 Reviewers: Noble Bowie1, John Donaldson1, Carol J. Hammel-Smith1, Ken Katz1, Orron Kee5
7. PERFORMING ORGANIZATION NAME(S) AND ADDRESS(ES) U.S. Department of Transportation Research and Special Projects Administration John A Volpe National Transportation System Center 55 Broadway Cambridge, MA 02142					8. PERFORMING ORGANIZATION REPORT NUMBER
9. SPONSORING/MONITORING AGENCY NAME(S) AND ADDRESS(ES) U.S. Department of Transportation National Highway Traffic Safety Administration					10. SPONSORING/MONITORING AGENCY REPORT NUMBER DOT-VNTSC-NHTSA-01-01
11. SUPPLEMENTARY NOTES 1 U.S. DOT, National Highway Traffic Safety Administration; 2 U.S. DOT, John A. Volpe National Transportation Systems Center 3 EG&G Technical Services, Inc.; 4 University of Central Florida; 5 Consultant to NHTSA
12a. DISTRIBUTION/AVAILABILITY STATEMENT This document is available to the public through the National Technical Information Service, Springfield, Virginia 22161.					12b. DISTRIBUTION CODE
13. ABSTRACT (Maximum 200 words) The National Highway Traffic Safety Administration (NHTSA) must set Corporate Average Fuel Economy (CAFE) standards for light trucks. This was authorized by the 1973-74 Energy Policy and Conservation Act, which added Title V: Improving Automotive Fuel Efficiency to the Motor Vehicle Information and Cost Saving Act (now codified at 49 U.S.C. Chapter 329). NHTSA is statutorily required to set CAFE standards at the "maximum feasible level" based on four criteria: technical feasibility, economic practicability, the effect of government motor vehicle standards on fuel economy and the need of the U.S. to conserve energy. With the lifting of the Congressional freeze on CAFE standards in December 2001, NHTSA is proposing new CAFE standards for MY 2005-2007 light trucks. To satisfy the requirements of the National Environmental Policy Act (NEPA), NHTSA, with the assistance of the John A Volpe National Transportation System Center, drafted this Draft Environmental Assessment, assessing the potential environmental impacts associated with the proposed action.
14. SUBJECT TERMS Corporate Average Fuel Economy (CAFE), standards for light trucks, fuel economy, automotive fuel efficiency						15. NUMBER OF PAGES
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TABLE OF CONTENTS

LIST OF TABLES

LIST OF FIGURES

LIST OF ACRONYMS

EXECUTIVE SUMMARY

INTRODUCTION

This Draft Environmental Assessment (EA) evaluates the potential environmental impacts associated with the National Highway Traffic Safety Administration’s (NHTSA) action to set Corporate Average Fuel Economy (CAFE) Standards for Model Year (MY) 2005-2007 light trucks. The Draft EA was prepared in accordance with the requirements of the National Environmental Policy Act (NEPA), the regulations of the Council on Environmental Quality (40 CFR Part 1500), and NHTSA regulations (49 CFR Part 520). Light trucks are defined as vehicles of 8,500 lbs. gross vehicle weight rating (GVWR) or less, and include pickup trucks, vans (cargo and passenger), minivans, and sport-utility vehicles (SUV) (NHTSA 1998). This Draft EA describes the environment and resources that might be affected by the setting of revised CAFE standards, and assesses the impacts of the proposed action against a baseline of 20.7 mpg (the most recent light truck CAFE standard, through MY 2004).

SUMMARY OF ENVIRONMENTAL CONSEQUENCES

Table ES-1 summarizes and compares the potential impacts for the baseline (20.7 mpg) standard and the Proposed Action. Discussion of specific resources follows the table.

Table ES-1. Summary of Potential Impacts

Resource	Baseline Standard (20.7 mpg)	Proposed Action
Energy	Continuation of current energy trends characterized by an increase in fuel consumption for light trucks.	Slower rate of growth in fuel consumption for light trucks. Slower rate of growth in oil exploration and extraction, oil refining, and oil transport.
Criteria Pollutant Emissions	Continuation of air quality trends characterized by an increase in criteria pollutant emissions from oil refining and distribution and the operation of light trucks.	Minor increases in CO and VOC emissions and minor reductions in NOx and PM 2.5. Overall minor changes in Air Quality based on extremely small changes in criteria pollutant emissions.
Greenhouse Gas Emissions	Increase in GHG emissions from oil refining and distribution and the operation of light trucks.	Reduction of GHG emissions.
Water Resources	Continuation of energy and air quality trends.	Minor benefit from reductions in energy consumption GHG emissions and minor changes based on extremely small changes in criteria pollutant emissions.
Biological Resources	Continuation of energy and air quality trends.	Minor benefit from reductions in energy consumption GHG emissions and minor changes based on extremely small changes to criteria pollutant emissions.
Land Use and Development	No new construction of light truck manufacturing plants.	No new construction of light truck manufacturing plants.
Hazardous Materials	Continuation of hazardous materials use and generation trends from the manufacturing of light trucks.	Minor reduction in the rate of growth of the generation of hazardous wastes (oily sludges, spent caustics, spent catalysts, wastewater, maintenance and materials handling wastes, and other process wastes) from the oil refining process. Continuation of hazardous materials use and generation trends from the manufacturing of light trucks.

Energy. Implementation of the Proposed Action would result in lifetime fuel savings for MY 2005-2007 light trucks of approximately 2.5 billion gallons, and therefore a reduction in oil exploration and extraction, transport, refining, and importation.

Criteria Pollutant Emissions. Implementation of the Proposed Action would result in extremely small changes in emissions of criteria pollutants. In particular, there would be overall increases in emissions of CO and VOC, and overall reductions in emissions of NO_X, and PM. On an annual basis, there would be small increases in emissions of CO, VOC (after 2010), and NO_X (after 2014), and small reductions in emissions of VOC (up to 2010), NO_X (up to 2014), and PM throughout the study period. All changes in criteria pollutants are extremely small when compared to total vehicle and transportation emissions, respectively.

Greenhouse Gas Emissions. Implementation of the Proposed Action would result in extremely small changes in emissions of CO₂ (a greenhouse gas). In particular, there would be overall decreases in emissions of CO₂. On an annual basis, there would be small decreases in emissions of CO₂ throughout the study period. All changes in CO₂ are extremely small when compared to total vehicle and transportation emissions, respectively.

Water Resources. The projected reduction in fuel production and consumption should lead to reductions in contamination of water resources. These include oil spills and leaks, pipeline blowouts, oil refinery liquid waste. The Proposed Action could also result in overall reductions in NO_X emissions, resulting in benefits to water resources from reduced acid rain generation.

Biological Resources. The projected reduction in fuel production and consumption should lead to minor reductions in impacts to biological resources. These include habitat encroachment and destruction, air and water pollution, and oil contamination from petroleum refining and distribution.

Land Use and Development. Major changes to manufacturing facilities could have implications for environmental issues associated with land use and development. However, analysis of available technologies and manufacturer capabilities indicates that manufacturers would be able to meet the proposed standards by applying technologies rather than, for example, changing product mix in ways that would lead to manufacturing plant changes. Therefore, the Proposed Action would have no impacts on land use or development.

Hazardous Materials. The Proposed Action would not alter the existing regulatory framework governing the transportation or storage of hazardous materials. However, the projected reduction in fuel production and consumption may lead to a reduction in the amount of hazardous wastes created by the oil refining process.

1.0 PURPOSE AND NEED

1.1. INTRODUCTION

This document accompanies the Notice of Proposed Rulemaking (NPRM) to set light truck fuel economy standards for Model Years (MY) 2005-2007 (67 FR XXXXX). The term "light truck" includes pickup trucks, vans (cargo and passenger), minivans, and sport-utility vehicles (SUV) that have a gross vehicle weight rating (GVWR) up to and including 8,500 pounds.

The National Highway Traffic Safety Administration (NHTSA or "the Agency") analyzed the fuel economy improvement capabilities of light truck manufacturers for MY 2005-2007, with emphasis on the six light truck manufacturers with the largest market share—General Motors, Ford, DaimlerChrysler, Toyota, Honda, and Nissan (NHTSA 2002b). As a result of that analysis, the agency proposes to set the corporate average fuel economy (CAFE) standards at the levels shown in Table 1-1.

Table 1-1. Proposed Fuel Economy Standards for MY 2005-2007 Light Trucks

Model Year (MY)	CAFE Standard (mpg)
2005	21.0
2006	21.6
2007	22.2

The National Environmental Policy Act of 1969 (NEPA)^[1] and the implementing regulations of the Council on Environmental Quality (CEQ) ^[2] establish policies and procedures to ensure that information on environmental impacts is available to decision makers, regulatory agencies, and the public before Federal actions are implemented. The John A. Volpe National Transportation Systems Center prepared this Draft Environmental Assessment (EA) to assist NHTSA in evaluating the potential environmental impacts associated with setting light truck fuel economy standards at the levels identified above. This Draft EA satisfies the requirements of the CEQ regulations and NHTSA’s Procedures for Considering Environmental Impacts (49 CFR Part 520) implementing the provisions of NEPA.

1.2. BACKGROUND

In December 1975, in the aftermath of the energy crisis created by the oil embargo of 1973-1974, Congress enacted the Energy Policy and Conservation Act (EPCA). The Act established an automotive fuel economy regulatory program by adding Title V, "Improving Automotive Fuel Efficiency," to the Motor Vehicle Information and Cost Saving Act. Title V has been codified as Chapter 329 of Title 49 of the United States Code. Section 32902(a) of Chapter 329 requires the Secretary of Transportation to prescribe by regulation CAFE standards for light trucks for each model year. That section states that the standard is to be the maximum feasible average fuel economy level that the Secretary decides the manufacturers can achieve in that model year, taking into account four criteria: technological feasibility, economic practicability, the effect of other Government motor vehicle standards on fuel economy, and the need for the United States to conserve energy. (For a detailed description of these criteria refer to the NPRM and Section I-1 of the Preliminary Economic Assessment). The Secretary has delegated the authority to administer the CAFE program to the NHTSA Administrator.

There is a penalty structure in place that dictates that a manufacturer whose light truck fleet does not meet the CAFE standard prescribed for a specific model year is liable to the United States Government for a civil penalty. The CAFE structure also embodies an incentive system whereby energy credits are allocated to manufacturers that exceed the CAFE standard in a given year. The penalty is $5.50 multiplied by each tenth of a mile per gallon that the manufacturer’s light truck fleet fuel economy falls short of the standard for the given year, multiplied by the number of automobiles produced by the manufacturer to which the standard applied during the model year. Manufacturers may carry forward previously earned credits and may carry back future credits for up to three years to account for any credit deficit.

The first fuel economy standards for light trucks - for MY 1979 - were established on March 14, 1977 (42 FR 13807). The standards covered light duty vehicles with a GVWR of 6,000 pounds or less. For subsequent model years, NHTSA established the standards for vehicles with a GVWR of up to 8,500 pounds. Figure 1-1 shows light truck fuel economy standards, actual fuel economy achieved, and light truck sales volumes for MY 1979-2000.

The DOT and Related Agencies Appropriations Acts for FY 1996-2001 each contained a provision that precluded the setting of CAFE standards differing from those promulgated prior to the enactment of FY 1996 appropriations and from spending any funds to collect and analyze data relating to CAFE levels. Hence, for the period covering MY 1998 through MY 2003, light truck CAFE standards remained at 20.7mpg. The Congressional freeze was lifted in FY 2002. The FY 2004 light truck CAFE standard also remains at 20.7 mpg. By law, NHTSA must issue fuel economy standards 18 months prior to the beginning of the affected model year. Therefore, a final rule setting the MY 2004 light truck standard had to be issued by April 1, 2002. Due to this severe time constraint, NHTSA did not have sufficient time to lay the factual or analytical foundation necessary to establish the MY 2004 standard at a level other than 20.7 mpg.

Source: Fuel economy data from EIA 2002a. Sales Volume: 1987-2000 data from Ward’s Automotive Yearbook. 1980-1986 data from American Automobile Manufacturer’s Association

Figure 1-1. CAFE Standards, Actual CAFE Achieved, and Sales Volumes, 1973-2001

On February 7, 2002, after the lifting of the Congressional freeze, NHTSA published a Request for Comments (RFC) in the Federal Register (67 F.R. 5767), seeking information to assist NHTSA in setting CAFE standards for MY 2005-2010 light trucks. The RFC also requested comments on possible modifications or reforms to the CAFE program. The RFC discussed general issues that NHTSA considered in evaluating fuel economy, and directed specific questions to light truck manufacturers. The comment period closed on May 8, 2002. The RFC and responses from commenters can be found on the Department of Transportation Docket Management System (DMS) website at http://dms.dot.gov, searching under Docket No. 11419.

Manufacturers responded to the RFC in varying levels of detail. In particular, product plan information concerning model years beyond MY 2007 was much less detailed than the same information for MY 2005-2007. On the basis of the level of detail of information received in response to the February 7, 2002 notice, and the statutory requirement to issue at least the MY 2005 standards no later than April 1, 2003, the agency decided to limit the proposed action to MY 2005-2007 light trucks, rather than extending it to MY 2010. Additional agency actions and appropriate environmental analyses will address future model years.

1.3. NEED FOR ACTION

In accordance with Chapter 329 of Title 49 of the United States Code, and the delegation of authority from the Secretary of Transportation to the NHTSA Administrator, NHTSA is required to set CAFE standards for light trucks for each model year, at least 18 months in advance of the model year. The current standard (20.7 mpg), set in FY 1994 for MY 1996 and MY 1997, is in place through MY 2004, due to the restrictions in the FY 1996 -2001 appropriations acts. With the lifting of the restrictions in December 2001, NHTSA must now take affirmative action to set the light truck standard at the maximum feasible average fuel economy level, based on the four statutory criteria identified above. Accordingly, NHTSA has published an NPRM, proposing CAFE standards for light trucks for MYs 2005-2007 (See Table 1-1). The Agency action is consistent with the recommendations presented in the Administration’s National Energy Policy.

1.4. SCOPE OF ANALYSIS

This Draft EA analyzes the potential environmental impacts associated with the CAFE standards proposed in the NPRM. The Draft EA describes the environment and resources that might be affected by the setting of CAFE standards, and the types of impacts that are possible. The Draft EA then assesses the impacts of the Proposed Action against a baseline of 20.7 mpg (the light truck CAFE standard in place through MY 2004). Finally, the analysis concludes with a reference to the cumulative impacts identified in previous environmental assessments.

2.0 ALTERNATIVES

Outlined below are the action proposed in the NPRM and the No Action Alternative to the proposed action, discussed within the unique context of the CAFE program and its statutory requirements. (For an in-depth discussion of the economic and technological factors underlying the agency’s proposed action, consult Chapter 5 of the Preliminary Economic Assessment).

2.1. PROPOSED ACTION

Under the action proposed by NHTSA in the NPRM, NHTSA would set CAFE standards for light trucks at 21.0 mpg for MY 2005, 21.6 mpg for MY 2006, and 22.2 mpg for MY 2007. These levels have been determined by NHTSA in the NPRM to be the maximum feasible average fuel economy levels, based on the four statutory criteria (NHTSA 2002a). Throughout this Draft EA, when addressing these proposed standards, we will refer to them as the "Proposed Action."

2.2. NO ACTION ALTERNATIVE

The alternative of taking no action is unavailable because 49 U.S.C. 32902(a) requires the Secretary of Transportation to prescribe, by rule, average fuel economy standards for light trucks. The closest to a No Action Alternative available to the agency is to maintain the standard at the MY 2004 level of 20.7 mpg, in which case there would be no new impacts associated with the Agency’s action relative to the standard set for MY 2004 in previous rulemaking. However, in accordance with statute, NHTSA must set CAFE standards for light trucks at the maximum feasible level, a level that is identified in the NPRM as above 20.7 mpg for each of the model years under consideration. The No Action Alternative does not satisfy the statutory requirement to set the standard at the maximum feasible average fuel economy level, and is not considered a practicable alternative. However, the 20.7-mpg level will be used as a baseline against which to compare the Proposed Action and to evaluate potential environmental impacts. Throughout this Draft EA, when addressing the 20.7-mpg level, we will refer to it as the "Baseline."

3.0 AFFECTED ENVIRONMENT

This Chapter briefly describes the range of resources that might be affected by the setting of CAFE standards and the types of impacts to health and the environment that might occur. Consult Chapter 4 for an evaluation of actual environmental impacts associated with the Proposed Action.

3.1. ENERGY

U.S. petroleum consumption has been steadily increasing recently, while U.S. petroleum production has been decreasing, as demonstrated in Figure 3-1. Consequently, U.S. net petroleum imports (defined as imports minus exports) have been increasing. The United States is increasingly dependent on imported oil, increasing its import oil share from 39.6 percent in 1991 to 55.5 percent in 2001. Domestic oil production has declined steadily since it peaked in 1985 and is expected to continue to decline by 0.2 percent per year from 2000 to 2020, with year 2020 production estimated at 5.6 million barrels per day. Although the U.S. holds only about three percent of the world’s known oil reserves, it is the second largest oil producer (EIA 2002a).

Source: EIA 2002a

Figure 3-1. U.S. Petroleum Imports, Exports, Production, and Consumption 1972-2001

Energy demand growth in the transportation sector averaged 2.0 percent per year during the 1970s but was slowed in the 1980s by rising fuel prices and new Federal efficiency standards. Currently, oil accounts for 95 percent of all energy consumed in the transportation sector. Within the transportation sector, gasoline consumption and imports have been increasing over time, as shown in Figure 3-2.

Source: EIA 2002a

Figure 3-2. U.S. Transportation Gasoline Import and Export, 1973-2001

From 1991 to 2000, fuel consumption for light trucks has varied between 668 and 721 gallons per vehicle per year, following no specific trend. During this same time period light truck adjusted on-road fuel economy (which is calculated by adjusting the EPA laboratory fuel economy numbers downward by 15 percent) has varied between 17.0 and 17.5 miles per gallon, with average annual mileage for these vehicles ranging from 11,684 to 12,430 miles. Table 3-1 details annual light truck fuel consumption, fuel economy, and annual mileage for 1973 through 2000.

Table 3-1. Light truck fuel consumption, fuel rate, and mileage, 1973-2000

Date	Vans, Pickup Trucks and Sport Utility Vehicles, Fuel Consumption (gallons/vehicle)	Vans, Pickup Trucks and Sport Utility Vehicles, Fuel Economy (mpg)1	Vans, Pickup Trucks and Sport Utility Vehicles, Mileage (miles)
1973	931	10.5	9,779
1974	862	11	9,452
1975	934	10.5	9,829
1976	934	10.8	10,127
1977	947	11.2	10,607
1978	948	11.6	10,968
1979	905	11.9	10,802
1980	854	12.2	10,437
1981	819	12.5	10,244
1982	762	13.5	10,276
1983	767	13.7	10,497
1984	797	14	11,151
1985	735	14.3	10,506
1986	738	14.6	10,764
1987	744	14.9	11,114
1988	745	15.4	11,465
1989	724	16.1	11,676
1990	738	16.1	11,902
1991	721	17	12,245
1992	717	17.3	12,381
1993	714	17.4	12,430
1994	701	17.3	12,156
1995	694	17.3	12,018
1996	685	17.2	11,811
1997	703	17.2	12,115
1998	707	17.2	12,173
1999	701	17	11,957
2000	668	17.5	11,684
Source: EIA 2002a
1The fuel economy numbers represented in this column reflect real world fuel economy estimates, which are arrived at by adjusting the EPA laboratory fuel economy numbers downward by 15 percent.

In recent years, most auto manufacturers were able to meet the corporate average fuel economy standards for light trucks of 20.7 mpg, as shown in Table 3-2 (Ward’s 2001).

Table 3-2. New Light Truck U.S. CAFE, MY 1993-2000

3.2. AIR QUALITY

3.2.1. Criteria Pollutant Emissions

Air quality is measured by determining the concentration of air pollutants present within the air mass of a region, in parts per million (ppm) or micrograms per cubic meter (μg/m³). Air pollutants are a significant cause of concern for both public health and welfare. In response to both of these concerns, Federal regulations have been developed for six criteria pollutants, under the National Ambient Air Quality Standards (NAAQS), that are considered harmful to public health and the environment. The six criteria pollutants are carbon monoxide (CO), lead (Pb), nitrogen dioxide (NO₂), ozone (O₃), sulfur dioxide (SO₂), and particulate matter (PM). Nitrogen dioxide reacts in the atmosphere over the course of several hours and is often referred to simply as nitrogen oxides (NO_x).

The ambient concentration of pollutants is compared with the EPA’s NAAQS in order to measure air quality. There are two types of standards - primary and secondary. Table C-1 in Appendix C shows these standards. Primary standards protect against adverse health effects; secondary standards protect against adverse welfare effects, such as damage to farm crops and vegetation and damage to buildings. Because different pollutants have different effects, the NAAQS for each pollutant is different. Some pollutants have standards for both long-term and short-term averaging times. The short-term standards were designed to protect against acute, or short-term, health effects, while the long-term standards were established to protect against chronic health effects.

When a geographic area falls within the NAAQS established by the Clean Air Act, it is called an attainment area; when concentrations of criteria pollutants in the region exceed the standards, it is called a non-attainment area. The EPA continuously monitors ambient air quality within counties and air basins in the U.S. A detailed description of the criteria pollutants and their sources, current status, and potential health effects is presented in Appendix C.

As shown in Table C-3 of Appendix C, transportation sources in the United States account for the highest or second highest levels of emissions for several pollutants. The transportation sector continues to be a substantial source of air pollutants at the national level, and is responsible for most of the total CO and NO_x emissions, close to half of the total VOCs (volatile organic compounds), and a quarter of total PM emissions. The contributions to Pb and SO_X emissions from vehicles are relatively less, partly due to their reduced presence in transportation fuels (Pb has essentially been eliminated from gasoline). Thus, the analysis of criteria pollutant emissions presented in Chapter 4 will focus on the effects of the Proposed Action on CO, NO_x, VOC, and PM emissions.

3.2.2. Greenhouse Gas Emissions

The transportation sector - specifically, motor-vehicle operation - is also a substantial contributor to greenhouse gas emissions, accounting for approximately one third of all greenhouse gas emissions in the United States. The operation of motor vehicles, including light trucks, accounts for the majority of these emissions. Thus, this draft environmental assessment will also examine the effects of the proposed light truck CAFE standards on the greenhouse gases. Greenhouse gases occur naturally, but also result from human activities, such as fossil fuel combustion, industrial processes, agricultural activities, deforestation, and waste treatment activities.

CO₂ is one of the main products of motor vehicle exhaust and, although it does not directly impair human health and is not regulated, in recent years it has started to be viewed as an issue of concern for its global climate change potential. The analysis includes calculations of changes of CO₂ as representative of emissions of greenhouse gases.

3.3. WATER RESOURCES

Water resources include surface water and groundwater. Surface waters are sources open to the atmosphere, such as rivers, lakes, reservoirs, and wetlands. Groundwater is found in natural reservoirs or aquifers below the earth's surface. Sources of groundwater include rainfall and surface water, which penetrate and move through the soil to the water table.

Water quality may be affected by changes in fuel consumption, as fuel consumption determines the level of oil drilling and oil transport activities, which in turn determine the risk of oil spills and leaks, pipeline blowouts, and water contamination during the drilling process. Additionally, fuel consumption determines the need for oil refining and associated oil refinery liquid waste and thermal pollution of waters near refineries (Epstein and Selber 2002).

In addition, because of wet deposition of air pollutants, changes in air emissions of criteria pollutants could be a source of concern for their potential effects on water quality. The generation of air pollution decreases air quality and adversely impacts water resources through the creation of acid rain. NO_X is a contributor to the formation of acid rain and acidification of freshwater bodies (EPA 2001). The ecological effects of acid rain are most clearly seen in aquatic environments. Acid rain flows to streams, lakes, and marshes after falling on forests, fields, buildings, and roads. Acid rain also falls directly on aquatic habitats.

3.4. BIOLOGICAL RESOURCES

Biological resources consist of all terrestrial and aquatic flora and fauna and the habitats in which they occur. The U.S. Fish and Wildlife Service has jurisdiction over terrestrial and freshwater ecosystems and the National Marine Fisheries Service has jurisdiction over marine ecosystems. Protected biological resources include sensitive habitats and species under consideration for listing (candidate species) or listed as threatened or endangered by the U.S. Fish and Wildlife Service or by individual States. Sensitive habitats include areas protected by legislation or habitats of concern to regulating agencies.

Petroleum drilling, refining, and transport activities, as well as emissions from fuel consumption, have the potential to impact biological resources through habitat destruction and encroachment, and air and water pollution, raising concern about their effects on the preservation of animal and plant populations and their habitats. Oil exploration and extraction result in intrusions into onshore and offshore natural habitats, and may involve construction within natural habitats. Also, oil drilling and transport result in oil spills and pipeline breaks; oil contamination of aquatic and coastal habitats can smother small species and is dangerous to animals and fish through oil ingestion and oil coatings on fur and skin. Similarly, oil-refining activities result in water and thermal pollution, both of which can be harmful to animal and plant populations (Epstein and Selber 2002). Finally, offshore drilling and oil transport from other countries can lead to vessel grounding, vessel collision, and other accidents that could affect plant and animal communities and their environments.

Oil drilling, refining, and transport activities, as well as the burning of fuel during the operation of light trucks, result in air emissions that have an effect on air quality and could have secondary effects on animal and plant populations and their supporting ecosystems. Potential effects on biological resources could be derived from particulate deposition and acid rain effects on water bodies, soils, and vegetation. Because of the interdependence of organisms in an aquatic ecosystem, acid rain and the changes it causes to pH or mineral and metal levels could affect biodiversity as well. In addition, acid rain enhances eutrophication of lakes, estuaries, and coastal environments. Eutrophication, defined as enrichment of a water body with plant nutrients, usually results in communities dominated by phytoplankton, and could result in the contamination of aquatic environments and harmful algal blooms, among other undesirable effects. Acid rain also causes slower growth, injury, or death of forests, and has been linked to forest and soil degradation in many areas of the eastern United States. The acidification of soils can also produce depletion of soil minerals that result in harmful mineral deficiencies for plants and wildlife. Finally, emissions of criteria pollutants and greenhouse gases could result in ozone layer depletion and promote climate change that could affect species and ecosystems.

3.5. LAND USE AND DEVELOPMENT

Land use and development refers to human activities that alter land (e.g., industrial and residential construction in urban and rural settings, clearing of forests for agricultural or industrial use) and may affect the amount of carbon or biomass in existing forest or soil stocks in the affected areas. For the purposes of this Draft EA, the main concern over land use and development issues is potential manufacturing plant changes that manufacturers may institute to respond to the Proposed Action.

3.6. HAZARDOUS MATERIALS

Hazardous materials are solid, liquid, or gaseous materials that because of their quantity, concentration, or physical, chemical, or infectious characteristics may cause or significantly contribute to an increase in mortality or an increase in irreversible illness or pose a substantial hazard to human health or the environment when improperly treated, stored, transported, or disposed of. Hazardous materials are designated by the Secretary of Transportation as posing an unreasonable risk to health, safety, property, and environment. Hazardous materials include hazardous substances, hazardous wastes, marine pollutants, elevated temperature materials, and materials identified by the DOT in the Code of Federal Regulations.

Hazardous wastes are generated during the oil refining process. These wastes include oily sludges, spent caustics, spent catalysts, wastewater, maintenance and materials handling wastes, and other process wastes (Freeman 1995).

4.0 ENVIRONMENTAL CONSEQUENCES

This Chapter addresses the potential environmental impacts associated with the Proposed Action, as compared to the Baseline (20.7 mpg). It begins with a discussion of assumptions, methodologies, and limitations, and how these might affect the reliability of the impact assessment. Next, it considers energy use, from the standpoint of both the refined fuel consumed by the affected motor vehicles and the energy used in the oil extraction, transportation, and refining process. Finally, it considers the impacts on environmental resources.

4.1. ASSUMPTIONS, METHODOLOGIES, AND LIMITATIONS

4.1.1. Assumptions and Methodologies

The following assumptions and methodologies were used to assess and quantify the environmental effects of the Proposed Action. It is important to note that these assumptions are inherently uncertain. However, the quantitative information presented in this chapter provides reasonable estimates of the approximate impacts of the Proposed Action. These estimates can also be used for comparison with national level projections.

Key analytical and modeling assumptions are described below. For further detail, refer to Appendix A.

Baseline. For purposes of this Draft EA, it is assumed that under the Baseline, the light truck CAFE standards for each of MY 2005-2007 would remain at the 20.7-mpg level. The Baseline is used to measure the potential effects of the Proposed Action. Some manufacturers already exceed this level, or have indicated plans to do so during one or more of MYs 2005-2007. Other manufacturers have indicated plans to achieve a level below 20.7 mpg, reflecting unadjusted CAFE levels (i.e., CAFE levels that do not account for credit use or adjustments to fuel economy levels for alternatively- and flexibly-fueled vehicles).

Technology Use. The analysis assumes that the fleet mix will remain the same, and that fuel economy increases will result from technological changes. Two major elements of the model methodology include: (1) projections of the technical characteristics and sales volumes of future product offerings, and (2) estimates of the applicability and incremental cost and fuel savings associated with different technologies that might be utilized. This information was used, along with assumptions about the value of anticipated fuel savings to vehicle purchasers, to estimate the level of technology utilization each manufacturer might undertake in response to the Proposed Action. Standard stock accounting and valuation techniques were then used to estimate corresponding future fuel consumption - and associated criteria pollutant and carbon emissions changes. Undiscounted environmental impacts were estimated separately for each model year over its lifetime in the U.S. vehicle fleet.

MY Lifetime and Survival Rate. Environmental impacts resulting from the Proposed Action were estimated separately for each model year over its lifespan in the U.S. vehicle fleet, extending from the initial year when the model year is offered for sale through the year when nearly all vehicles from the model year have been retired or scrapped (approximately 25 years). A "survival rate" is assumed by applying estimates of the proportion of vehicles surviving at each age interval up to 25 years. Undiscounted environmental impacts resulting from a tighter CAFE standard were estimated separately for each model year over its lifetime.

Lifetime and Annual Data. Fuel consumption and emissions information is presented in lifetime and annual data formats. Lifetime data present a summary of aggregate changes over 25 years. Annual information is also important because energy and emissions budgets are developed on an annual basis. The three calendar years corresponding to the model year light trucks affected by the Proposed Action (2005, 2006, and 2007) were considered, as well as years 2010, 2015, and 2020. The year 2020 was selected as the end-point for annual data since it corresponds with the year used in energy and environmental forecasts and projections (EIA 2002). The five-year intervals were chosen to capture additional information. See Appendices B and C for detailed annual data. All environmental impacts in the analysis are assessed from annual data.

Rebound Effect. Tightening CAFE standards reduces the fuel component of the cost of operating light-duty vehicles, leading to an increase in vehicle use. The resulting increase, termed the "rebound effect," offsets part of the reduction in gasoline consumption and petroleum use that results from improved fuel efficiency.

The most recent estimates of the magnitude of the rebound effect for light-duty vehicles fall in the relatively narrow range of 10% to 20%, which implies that increasing vehicle use will offset 10 -20% of the fuel savings resulting from an improvement in fuel economy. A rebound effect of 15 % was employed after reviewing the literature, which is the midpoint of the most recent estimates. The rebound effect produces a corresponding increase in the total number of miles driven for each subsequent calendar year the subject vehicles remain in the fleet.

Vehicle-Miles-Traveled (VMT). The analysis assumes a baseline average annual VMT growth rate of 1.8 %^[3] over the entire study period. The growth rate was used to project future travel trends and to calculate the resulting emissions from all vehicles in the fleet. Estimates of future emissions from all vehicles were used as a baseline, and compared with the contribution of emissions from the light trucks affected by the Proposed Action.

Fuel Production. Part of the fuel savings resulting from the Proposed Action leads to lower U.S. imports of refined gasoline, and thus does not affect refinery emission levels in the U.S. However, the remaining fuel savings are assumed to reduce the volume of gasoline refined within the U.S. (from either imported or domestically-produced crude petroleum), which produces a corresponding reduction in criteria pollutant refinery emissions. This analysis assumes 55% of refined gasoline is imported and 45% is refined in the U.S.^[4]

Industry-wide Estimates of Environmental Effects. The analysis developed for the Draft EA relies on industry-wide estimates of effects, such as changes in fuel consumption and emissions. This level of aggregation is consistent with the estimation of national-scale environmental effects. However, in some cases, the Draft EA reports effects on an average per-vehicle basis. Such reporting provides an alternative sense of scale that may make the information more easily accessible to the reader.

Manufacturing Plans. Although current CAFE levels and product plans vary among manufacturers, the proposed changes to light truck CAFE standards would not likely require any manufacturers to change light trucks in ways that would have important environmental effects unrelated to vehicle use. Rather, all manufacturers would likely be able to meet the proposed standards through changes in vehicle design (e.g., aerodynamics) and components (e.g., transmissions), neither of which is expected to significantly alter the quantity or mix of materials used for vehicle production.

Criteria Pollutant Emissions. The MOBILE6.1/6.2 model projects significant emissions deterioration over a vehicle’s useful life. In particular, the model projects that CO, VOC, and NO_X emission rates would each increase over the useful life of trucks affected by the Proposed Action. This increase plays an important role in the evolution of total annual emissions from trucks sold as they age. Emissions associated with the rebound effect and marginal changes in petroleum supply are also influenced.

Greenhouse Gas Emissions. The analysis includes calculations of changes of CO₂ emissions from light trucks due to the Proposed Action, but not calculations of changes in emissions of other greenhouse gases. When different species are weighted by their respective global warming potentials, carbon dioxide accounts for more than 95% of the total greenhouse gas emissions from the transportation sector (EPA 1999a). Additionally, CO₂ emissions result directly from and are directly proportional to the combustion of fuels. Because of the importance of CO_2, and because the other greenhouse gases make only a minor contribution, the analysis focuses on assessing CO₂ as representative of all greenhouse gases. The Intergovernmental Panel on Climate Change guidelines also employs CO₂ as representative of greenhouse gas emissions (EPA 2002b).

4.1.2 Limitations

The emissions estimates presented in this section are dependent on both the rebound effect and the marginal dynamics of petroleum supply, both of which are highly uncertain. If the actual additional vehicle miles driven are smaller or larger than the 15% assumed for the rebound effect, for example, the model could be over or under-estimating the resulting impacts. Thus, the calculations of net emissions changes are also uncertain. However, the analysis yields estimates of net emissions changes that are, without exception, extremely small relative to aggregate national emissions. In addition, under any set of reasonable assumptions regarding the rebound effect and marginal petroleum supply, the magnitude of these calculated net changes in criteria pollutants are extremely small.

The results of the analysis are also highly dependent on projections of future vehicle survival rates and annual use (i.e., VMT). If actual values diverge from these projections, the proposal’s actual effects will differ from the estimates presented in the Draft EA.

Actual CAFE levels achieved may differ from the assumptions in the calculations. However, the manufacturer response is estimated for both the Proposed Action and the Baseline and the analysis takes into account the possibility of over and under compliance.

With respect to the impacts on reduced refinery emissions due to decreases in consumption, a recent EIA report states that increases in fuel economy standards, depending on the magnitude and timing of such increases, will yield a similar share of gasoline consumption savings, reflected in reduced imports of gasoline (EIA 2002c). However, estimates of market responses relating to gasoline imports and domestic refining are variable and highly uncertain, such that other refining/import scenarios are plausible.

4.2. ENERGY

A change in CAFE standards changes fuel consumption. Air quality and other resources are impacted by changes in fuel consumption. For example, a decrease in fuel consumption due to higher CAFE standards may cause a decrease in oil refining and distribution emissions, but an increase in tailpipe emissions attributable to the assumed rebound effect.

In order to determine the impacts of the Proposed Action, the total energy consumption of the affected trucks in the fleet for a 25-year lifetime will be calculated, as well as a yearly analysis of gasoline consumed. These data will then be compared to the fuel used under the Baseline.

4.2.1. Baseline

Lifetime Fuel Consumption

The methodology described in Appendix A was used to calculate the total fuel consumption for MY 2005-2007 light trucks throughout their lifetime in the fleet under the Baseline. The total would be approximately 194.8 billion gallons (22,310 trillion BTU).

Annual Fuel Consumption

A yearly analysis of gasoline consumption was developed to illustrate the effects of light truck fuel consumption over time in "Annual Snapshots." Fuel consumption data for the same calendar years as the proposed action (2005, 2006, and 2007), and for 2010, 2015, and 2020 are presented. Figure 4-1 shows the total gallons of fuel consumed on an annual basis for those calendar years. These numbers are aggregated across MY 2005-2007. Thus, the calendar year 2005 consumption value includes MY 2005 and MY 2006 light trucks that are sold and operated in calendar year 2005, the calendar year 2006 consumption value includes MY 2005 light trucks operating in calendar year 2006 plus MY 2006 and MY 2007 light trucks sold and operated in calendar year 2006, and the calendar year 2007 consumption value includes MY 2005, MY 2006, and MY 2007 light trucks operating in calendar year 2007. The calendar year 2010, 2015, and 2020 values include the MY 2005-2007 light trucks still operating in each respective calendar year.

Figure 4-1 shows an increase in gallons of gasoline consumed during calendar years 2005 through 2007 by MY 2005-2007 light trucks as the number of vehicle introductions of those model years increase. The amount of gasoline consumed during calendar years 2010-2020 by MY 2005-2007 light trucks decreases because vehicle miles traveled decrease over time as vehicles are scrapped. Refer to Table B-1 in Appendix B for an estimate of total energy consumption calculations per year for calendar years 2004-2031.

Figure 4-1. Baseline - Annual Energy Consumption, 2005-2020

4.2.2. Proposed Action

Lifetime Fuel Consumption

The methodology described in Appendix A was used to calculate fuel consumption for MYs 2005-2007 light trucks throughout their lifetime in the fleet, under the Proposed Action. The total gasoline consumption for these trucks would be approximately 192.3 billion gallons (22,025 trillion BTU).

Annual Fuel Consumption

A yearly analysis of gasoline consumption was developed to estimate future energy consumption under the Proposed Action. Figure 4-2 shows the total fuel consumed by MY 2005 - 2007 light trucks on an annual basis during 2005, 2006, 2007, 2010, 2015, and 2020. These numbers are aggregated across MYs 2005-2007. Thus, the calendar year 2005 consumption value includes MY 2005 and MY 2006 light trucks that are sold and operated in calendar year 2005, the calendar year 2006 consumption value includes MY 2005 light trucks operating in calendar year 2006 plus MY 2006 and MY 2007 light trucks sold and operated in calendar year 2006, and the calendar year 2007 consumption value includes MY 2005, MY 2006, and MY 2007 light trucks operating in calendar year 2007. Similarly the calendar year 2010, 2015, and 2020 values include the MY 2005-2007 light trucks still operating at each respective calendar year.

Figure 4-2 shows an upward trend in fuel consumed over calendar years 2005-2007 as more vehicles are introduced, and a downward trend over calendar years 2010 - 2020 as the trucks age or are retired. Refer to Table B-2 in Appendix B for total fuel consumption calculations per year for calendar years 2004-2031.

The aggregated numbers under the Proposed Action were compared to those under the Baseline in order to show the amount of fuel saved. This change in fuel consumption was then compared with the Energy Information Administration (EIA) projected overall gasoline consumption by all light trucks on an annual basis. The EIA forecasts total energy consumption in BTUs on a yearly basis, so fuel consumption figures were converted to BTUs for comparison purposes.

Figure 4-2. Proposed Action - Annual Gasoline Consumption, 2005-2020

Table 4-1 shows the amount of fuel saved on an annual basis when the Proposed Action is compared to the Baseline and annual savings as a percentage of the EIA 2002 energy consumption forecast. The amount and percent of fuel saved increases over calendar years 2005-2007 as the number of MY 2005-2007 light trucks on the road increases. The amount and percent of fuel saved from calendar years 2010-2020 by MY 2005-2007 light trucks decreases because vehicle miles traveled decrease over time, although savings remain positive. Overall, the total amount of fuel saved (under the Proposed Action, as compared to the Baseline) continues to increase through calendar year 2020. Refer to Table B-3 in Appendix B for total change in energy consumption calculations per year for the years 2004-2031.

Table 4-1. Proposed Action - Change in Energy Consumption and Baseline EIA Energy Consumption Projections, 2005- 2020

Figure 4-3 illustrates the amount of energy - in BTUs - saved on an annual basis under the Proposed Action. The amount of energy saved increases over calendar years 2005-2007 as the number of MY 2005-2007 light trucks on the road increases. The amount of energy saved from calendar years 2010-2020 by MY 2005-2007 light trucks decreases (although it still remains positive) because vehicle miles traveled decrease over time.

Figure 4-3. Proposed Action - Reduction in Energy Consumption, 2005-2020

Figure 4-4 shows the amount of energy saved on an annual basis as a percentage of the EIA 2002 energy consumption forecast for the respective calendar years of interest. The percent of energy saved increases over calendar years 2005-2007 as the number of MY 2005-2007 light trucks on the road increases. The percent of energy saved from calendar years 2010-2020 by MY 2005-2007 light trucks decreases (although still positive) because vehicle miles traveled decrease over time.

Figure 4-4. Proposed Action - Annual Reduction in Energy Consumption as a Percentage of EIA Annual Energy Consumption Forecast

As illustrated by the above table and figures, the CAFE standards under the Proposed Action are projected to decrease gasoline consumption by MY 2005-2007 light trucks on an annual basis and on an aggregate basis throughout the lifetime of the affected fleet.

4.3. AIR QUALITY

4.3.1. Criteria Pollutant Emissions

The EPA emissions model, MOBILE6.1/6.2 (MOBILE6), was used to estimate changes in criteria pollutant emissions. MOBILE6 is an emissions factor model used for predicting grams-per-mile emissions of VOC, CO, NO_X, PM, and toxics from cars, trucks, and motorcycles under various conditions. It accounts for several new national emission control measures for both light-duty vehicles under 8,500 pounds gross vehicle weight rating (GVWR) and heavy-duty diesel engines. It also includes the benefits of low sulfur fuel for both light and heavy-duty vehicles. The MOBILE 6 model was used to compare emissions of criteria pollutants from MY 2005-2007 light trucks to the overall contribution of emissions from all vehicles in the U.S. fleet. Using expected VMT, the projected baseline emissions for all vehicles (including passenger cars and trucks) was used to develop an emissions inventory.

Because it is difficult to estimate a given action’s effect on the atmospheric concentration of some pollutants, emission inventories are also used to gauge the effects of such actions. An emission inventory is a summation of the total mass of a pollutant that is released to the atmosphere within a given geographic area and during a specified period. A national input file was obtained from the EPA Office of Transportation and Air Quality (OTAQ) and used to determine the emissions of CO, VOC, NO_X, and PM 2.5 (reference). The model was executed for calendar years 2005, 2006, 2007, 2010, 2015, and 2020.

Changes in criteria pollutants were determined by combining estimates of emissions reductions from reduced gasoline refining and distribution with estimates of emissions increases from increased VMT as a result of the rebound effect (see Appendix A). Reductions in criteria pollutant emissions from reduced gasoline refining and distribution were calculated using emissions rates obtained from Argonne National Laboratories’ Greenhouse Gases and Regulated Emissions in Transportation model (GREET) (Argonne 2002).

The contribution of emissions from the Proposed Action was determined by comparing the estimated emissions for the Proposed Action with those for the Baseline. Under the Baseline, emissions from petroleum refining and gasoline distribution are assessed to estimate CO, VOC, NO_X, and PM 2.5 levels. In contrast, the Proposed Action also assesses CO, VOC, NO_X, and PM 2.5 emissions associated with the 15% rebound effect, as well as those from petroleum refining and gasoline distribution.

Emissions estimates for MY 2005-2007 light trucks were developed on a yearly basis for all light trucks for each of those model years. In order to determine the overall implications of the Proposed Action over the 25-year lifetime, as compared to the Baseline, the yearly emissions calculations were summarized to estimate aggregated lifetime emissions for MY 2005-2007 light trucks under the Baseline and Proposed Action. In addition, emission inventories for individual calendar years of interest - through 2020 were calculated to provide estimates of annual changes in emissions under the Proposed Action as compared to the Baseline. The annual emissions inventories were calculated by adding the emissions from all MY 2005, 2006, and 2007 light trucks in operation for the particular calendar year. For example, total emissions for calendar year 2010 were calculated by adding the total emissions from MY 2005-2007 light trucks still in operation that year.

Baseline

Lifetime Projected Emissions

The methodology described in Appendix A was used to calculate the total CO, VOC, NO_X, and PM 2.5 emissions for MY 2005-2007 light trucks throughout their lifetime in the fleet, assumed to be 25 years. As presented in Figure 4-5, under the Baseline, it is estimated that CO upstream emissions would be approximately 301.4 thousand tons, VOC emissions would be approximately 208.7 thousand tons, NO_X emissions would be approximately 454.0 thousand tons, and PM 2.5 emissions would be approximately 45.8 thousand tons, for the 25-year lifetime of MY 2005-2007 light trucks.

Figure 4-5. Baseline - Lifetime Upstream Emissions for Criteria Pollutants

Annual Projected Emissions

A yearly breakdown of upstream emissions for criteria pollutants generated under the Baseline can be found in Tables C-7 through C-10 in Appendix C. Criteria pollutant upstream emissions for calendar years 2005, 2006, 2007, 2010, 2015, and 2020 were closely examined in order to compare them to baseline emissions projected using the MOBILE6 model.

Figure 4-6 details criteria pollutant emissions for calendar years 2005, 2006, 2007, 2010, 2015, and 2020 under the Baseline. As expected, criteria pollutant upstream emissions are highest in calendar year 2007 since most MY 2005-2007 light trucks are in use and vehicle miles traveled are at their highest due to the low age of the vehicles.

Figure 4-6. Baseline - Annual Upstream Emissions for Criteria Pollutants, 2005-2020

Proposed Action

Lifetime Projected Emissions

Under the Proposed Action, it is estimated that criteria pollutant emissions would be approximately 399.5 thousand tons for CO, 211.7 thousand tons for VOC, 453.4 thousand tons for NO_X, and 45.3 thousand tons for PM 2.5, respectively, for the 25-year lifetime of MY 2005-2007 light trucks. Figure 4-7 presents a graphical representation of these values. As noted in the introduction, total emissions reported in this figure reflect the sum of upstream (refinery and distribution) and rebound-effect related emissions.

Figure 4-7. Proposed Action - Lifetime Upstream and Rebound Emissions for Criteria Pollutants

When compared to the Baseline, the Proposed Action would result in an estimated increase in CO and VOC emissions of 98.1 thousand tons and 3.0 thousand tons, respectively, and a projected decrease of NO_X, and PM 2.5 of 0.6 thousand tons and 0.5 thousand tons, respectively, over the 25-year lifetime of the MY 2005-2007 light trucks This is shown in Figure 4-8. Thus, implementation of the Proposed Action results in increases in lifetime emissions of CO and VOC, and reductions in lifetime emissions of NO_X and PM 2.5.

Figure 4-8. Proposed Action - Change in Lifetime Emissions for Criteria Pollutants

Annual Projected Emissions

In order to compare Proposed Action emissions to the overall contribution of emissions from vehicles, yearly upstream and rebound emissions for criteria pollutants were calculated. A yearly breakdown of the upstream and rebound emissions generated under the Proposed Action can be found in Tables C-12 through C-15 in Appendix C.

Figure 4-9 shows Proposed Action upstream and rebound emissions for calendar years 2005, 2006, 2007, 2010, 2015, and 2020. As expected, criteria pollutant emissions are highest in calendar year 2007 (compared to calendar years 2005, 2006, 2010, 2015, and 2020). This is because the vast majority of MY 2005-2007 light trucks would be in use and vehicle miles traveled are at their highest.

Figure 4-9. Proposed Action - Annual Upstream and Rebound Emissions for Criteria Pollutants 2005-2020

When Proposed Action upstream and rebound emissions from calendar years 2005, 2006, 2007, 2010, 2015, and 2020 are compared to Baseline upstream emissions, projected CO emissions increase each calendar year. CO emissions increase because, while the savings in gasoline use and the resulting reduction in CO emissions from gasoline refining and distribution grow over time, increase in vehicle CO emissions resulting from the rebound effect more than offsets this reduction. When compared to the Baseline, the Proposed Action results in an estimated initial decrease in VOC emissions through calendar year 2010, but an estimated increase in emissions for calendar years 2011 through 2020.

The Proposed Action also results in an estimated initial decrease in NO_X emissions through calendar year 2014, but an estimated increase in emissions for calendar years 2015 through 2020. Compared to the Baseline, the Proposed Action would result in an estimated decrease in PM 2.5 emissions through calendar year 2020. When considering these results, it is important to recall that changes in criteria pollutant emissions were calculated assuming that reductions in imports of refined gasoline would account for 55% of the domestic gasoline consumption reduction attributed to the Proposed Action. Under this analysis, some of the emission benefits from reduced refining and distribution would not occur in the U.S., and are thus not accounted for in this analysis.

In order to compare emissions of criteria pollutants from MY 2005-2007 light trucks to the overall contribution of vehicle emissions, the MOBILE6 model was run to project baseline emissions for all vehicles. Table 4-2 details changes in criteria pollutant emissions for light trucks, as well as baseline emissions projections for all vehicles, and projections of light truck emissions changes as compared to emissions from all vehicles for calendar years 2005, 2006, 2007, 2010, 2015, and 2020.

Table 4-2. Proposed Action - Percent Change in Criteria Pollutant Emissions under the Proposed Action when compared to Baseline Emissions Projections for all Vehicles^[5] (Calendar Years 2005-2020)

Figure 4-10 details change in emissions for criteria pollutants for calendar years 2005, 2006, 2007, 2010, 2015, and 2020. For a yearly breakdown of changes in emissions, see Tables C-17 through C-20 in Appendix C.

Figure 4-10. Proposed Action - Annual Change in Emissions for Criteria Pollutants, Calendar Years 2005-2020

Figure 4-11 shows changes in emissions from MY 2005-2007 light trucks - at different calendar years during their lifetime in the fleet - as a percentage of projected aggregate national criteria pollutant emissions for all vehicles. The increase of CO emissions from light trucks comprises at most an estimated 0.021 percent - in calendar year 2015 - of the baseline emissions projections for all vehicles during the study period (2005-2020).

The initial decrease in VOC emissions comprises at most 0.003 percent - in calendar year 2007 - of the baseline emissions projections for all vehicles during the study period. Subsequent increases in VOC emissions, associated with the rebound effect, offset emissions decreases from reduced refining and distribution. This comprises at most 0.011 percent - in calendar year 2020 - of the baseline emissions projections for all vehicles during the study period.

The initial decrease in NO_X emissions comprises at most 0.008 percent (calendar year 2007) of the baseline emissions projections for all vehicles during the study period. Subsequent increases in NO_X emissions comprise at most 0.005 percent (in calendar year 2020) of the baseline emissions projections for all vehicles during the study period. For the analyzed study period, the decreases in PM 2.5 emissions from MY 2005-2007 light trucks ranged between 0.002 percent and 0.013 percent of total PM 2.5 emissions from all vehicles.

Figure 4-11. Proposed Action - Change in Criteria Pollutant Emissions as a Percent of all Vehicle Emissions, Calendar Years 2005-2020

Although there is a small increase in CO, VOC and NO_X emissions at different times during the study period, these values are very small percentages in relation to projections of aggregate national emissions for all vehicles. Yearly decreases in VOC and NO_X at different times during the study period, along with decreases in PM 2.5 through calendar year 2020 would provide benefits. In addition, the net changes in emissions are extremely small in relation to national levels of criteria pollutant emissions for all vehicles.

4.3.2. Greenhouse Gas Emissions

Changes in CO₂ were determined by combining estimates of emissions reductions from reduced gasoline refining and distribution with estimates of emissions increases from increased VMT as a result of the rebound effect (see Appendix A). Reductions in CO₂ emissions from reduced gasoline refining and distribution were calculated using emissions rates obtained from Argonne National Laboratories’ Greenhouse Gases and Regulated Emissions in Transportation model (GREET) (Argonne 2002). The reduction of CO₂ emissions from the Proposed Action was determined using the same methodology as for criteria pollutants, by comparing the estimated emissions for the Proposed Action with those for the Baseline. Under the Baseline, greenhouse gas emissions from petroleum refining and gasoline distribution are assessed; in contrast, the Proposed Action also assesses CO₂ emissions associated with the 15% rebound effect, as well as those from petroleum refining and gasoline distribution.

CO₂ emissions estimates for MY 2005-2007 light trucks were also developed on a yearly basis for all light trucks for each of those model years. In order to determine the overall implications of the Proposed Action over the 25-year lifetime, as compared to the Baseline, the yearly emissions calculations were summarized to estimate aggregated lifetime emissions for MY 2005-2007 light trucks under the Baseline and Proposed Action. In addition, emission inventories for individual calendar years of interest - through 2020 were calculated to provide estimates of annual changes in CO₂ emissions under the Proposed Action as compared to the Baseline. The annual emissions inventories were calculated in the same way as those for criteria pollutant emissions.

Baseline

Estimates of greenhouse gas upstream emissions are presented in millions of metric tons of carbon equivalents (MMTCe), which weights each gas by its Global Warming Potential (GWP) value. The concept of a GWP was developed to compare the relative ability of each greenhouse gas to trap heat in the atmosphere.

Lifetime Projected Emissions

Under the Baseline, an estimated 510.8 MMTCe of CO₂ would be emitted during the 25-year lifetime of MY 2005-2007 light trucks. These emissions will be used as a basis to determine potential impacts from the Proposed Action.

Annual Projected Emissions

A yearly breakdown of upstream emissions for greenhouse gases generated under the Baseline can be found in Table C-11 in Appendix C. Greenhouse gas upstream emissions for calendar years 2005, 2006, 2007, 2010, 2015, and 2020 were closely examined. Figure 4-12 details greenhouse gas emissions for calendar years 2005, 2006, 2007, 2010, 2015, and 2020 under the Baseline. As expected, greenhouse gas upstream emissions are highest in calendar year 2007 (compared to calendar years 2005, 2006, 2010, 2015, and 2020), since the vast majority of MY 2005-2007 light trucks are in use and vehicle miles traveled are at their highest level.

Figure 4-12. Baseline - Annual Upstream Emissions for Greenhouse Gases, 2005-2020

Proposed Action

Estimates of greenhouse gas upstream emissions are presented in millions of metric tons of carbon equivalents (MMTCe), which weights each gas by its Global Warming Potential (GWP) value. The concept of a GWP was developed to compare the relative ability of each greenhouse gas to trap heat in the atmosphere.

Lifetime Projected Emissions

Under the Proposed Action, an estimated 504.2 MMTCe of carbon emissions (from CO₂ only) would result from the 25-year lifetime of MY 2005-2007 light trucks. Compared to the Baseline, the Proposed Action would reduce carbon emissions by an estimated 6.5 MMTCe for the 25-year lifetime of MY 2005-2007 light trucks. Additionally, a reduction in carbon emissions is estimated for each calendar year of the 2005-2020-study period. Thus, the Proposed Action would provide a benefit as a result of the reduction of GHG emissions from transportation in the U.S.

Annual Projected Emissions

The changes in CO₂ emissions - when comparing Baseline and Proposed Action emissions - for light trucks for calendar years 2005, 2010, 2015, and 2020 were compared to the EIA annual energy projections of total CO₂ emissions for the transportation sector for those calendar years. The EIA did not estimate emissions for calendar years 2006 and 2007 in its 2002 forecast (EIA 2002b). For calendar years 2005, 2010, 2015, and 2020, estimated decreases in CO₂ emissions from light trucks ranged between 0.015 percent and 0.075 percent of total emissions from all transportation CO₂ emissions. The benefits peak in 2010 and then decrease over time. Therefore, there is a benefit in CO₂ emissions when compared to total transportation CO₂ emissions on an annual basis. Table 4-3 details reductions in CO₂ emissions for MY 2005-2007 light trucks, baseline CO₂ emissions projections for the transportation sector, and estimated light truck CO₂ emissions change as compared to the total transportation sector for calendar years 2005, 2010, 2015, and 2020.

Table 4-3. Proposed Action - Estimated Reduction in CO₂ Emissions and Baseline CO₂ Emissions Projections, 2005-2020

Figure 4-13 shows reductions in emissions as a percent composition of total transportation emissions for CO₂.

Figure 4-13. Proposed Action Reduction in Emissions as a Percent of Total Transportation Emissions for CO₂, 2005-2020

4.4. WATER RESOURCES

Water quality may be affected by changes in energy consumption. The decrease in fuel consumption could result in reductions in oil spills and leaks, pipeline blowouts, and water contamination during the drilling process. Additionally, there could be reductions in oil refining and associated oil refinery liquid waste and thermal pollution of waters near refineries. The analysis shows decreases in NOx through 2014, and also a lifetime reduction over the 25- year study period. Some benefits to water resources from reduced acid rain generation could be realized.

Therefore, the Proposed Action could result in benefits to water resources from reduced energy consumption. However, since the energy consumption changes are small when compared to fuel consumption from other transportation activities, these water resource benefits would be small.

4.5. BIOLOGICAL RESOURCES

Biological resources may be affected by changes in energy consumption. A decrease in fuel consumption could result in reductions in petroleum drilling, refining, and transport activities, potentially reducing impacts to biological resources resulting from habitat destruction and encroachment, and air and water pollution. In addition, there could be reductions in oil exploration and extraction, potentially resulting in decreased intrusions into onshore and offshore natural habitats, and construction within natural habitats. Also, reductions in oil drilling and transport could result in decreases in oil spills and pipeline breaks, reducing potential impacts from oil contamination of aquatic and coastal habitats. Additionally, there could be reductions in oil refining and associated oil refinery liquid waste and thermal pollution of waters near refineries. Finally, decreases in oil drilling and refining activities can also result in reduced noise pollution, with a positive benefit to animal populations. The Proposed Action would result in decreases in greenhouse gas emissions that could result in benefits to ecosystems.

Therefore, the Proposed Action could result in benefits to biological resources from reduced energy consumption. However, since the changes are small when compared to fuel consumption and emissions from other transportation activities, these benefits would be small.

4.6. LAND USE AND DEVELOPMENT

For the purposes of this Draft EA, land use and development issues relate to potential manufacturing plant changes that manufacturers may embark on to respond to a change in light-truck fuel economy standards. As indicated in the manufacturers’ comments, product changes would be likely in order for manufacturers to comply with increased fuel economy. Additionally, changes in the light-truck economic market independent of the Proposed Action (e.g., a change in the number of light trucks purchased by consumers or a consumer switch to different brands or types of vehicles) may cause plants to be built or shut down.

Major changes to manufacturing facilities could have implications for environmental issues associated with land use and development. However, as discussed above in Section 4.1.1, NHTSA’s analysis of available technologies and manufacturer capabilities indicates that manufacturers would likely be able to meet the proposed standards by applying technologies rather than, for example, changing product mix in ways that would that lead to manufacturing plant changes. Therefore, the Proposed Action would not likely impact land use or development.

4.7. HAZARDOUS MATERIALS

The projected reduction in fuel consumption under the Proposed Action may lead to a reduction in the amount of hazardous wastes created by the oil refining process. These wastes may include oily sludges, spent caustics, spent catalysts, wastewater, maintenance and materials handling wastes, and other process wastes (Freeman 1995). As a result, there would be small benefits with regard to hazardous materials from the implementation of the Proposed Action.

4.8. SUMMARY OF POTENTIAL ENVIRONMENTAL EFFECTS

Table 4-4 summarizes the potential impacts under the Baseline and the Proposed Action.

Table 4-4. Summary of Potential Impacts

Resource	Baseline - Current Standard	Proposed Action
Energy	Continuation of current energy trends characterized by an increase in fuel consumption for light trucks.	Slower rate of growth in fuel consumption for light trucks. Slower rate of growth in oil exploration and extraction, oil refining, and oil transport.
Criteria Pollutant Emissions	Continuation of air quality trends characterized by an increase in criteria pollutant emissions from oil refining and distribution and the operation of light trucks.	Minor increases in CO and VOC emissions and minor reductions in NOx and PM 2.5. Overall minor changes in Air Quality based on extremely small changes in criteria pollutant emissions.
Greenhouse Gas Emissions	Increase in GHG emissions from oil refining and distribution and the operation of light trucks.	Reduction in GHG emissions.
Water Resources	Continuation of energy and air quality trends.	Minor benefit from reductions in energy consumption GHG emissions and minor changes based on extremely small changes in criteria pollutant emissions.
Biological Resources	Continuation of energy and air quality trends.	Minor benefit from reductions in energy consumption GHG emissions and minor changes based on extremely small changes in criteria pollutant emissions.
Land Use and Development	No new construction of light truck manufacturing plants.	No new construction of light truck manufacturing plants.
Hazardous Materials	Continuation of hazardous materials use and generation trends from the manufacturing of light trucks.	Minor reduction in the rate of growth of the generation of hazardous wastes (oily sludges, spent caustics, spent catalysts, wastewater, maintenance and materials handling wastes, and other process wastes) from the oil refining process. Continuation of hazardous materials use and generation trends from the manufacturing of light trucks.

4.8.1. Summary of Energy Effects

Table 4-5 summarizes fuel consumption under the Baseline and Proposed Action Alternatives. Comparison of the Proposed Action with the Baseline shows that the Proposed Action would result in a decrease in fuel consumption over the lifetime of the MY 2005 - 2007 fleet. The total amount of fuel saved under the Proposed Action over the useful lifetime of the affected light truck fleet (MY 2005-2007) would be approximately 2.5 billion gallons (286 trillion BTU). Therefore, the Proposed Action also results in a reduction in oil exploration and extraction, oil transport, and oil refining.

Table 4-5. Fuel Consumption under the Baseline and the Proposed Action

4.8.2. Summary of Air Quality Effects

Table 4-6 summarizes the effects of the Baseline and the Proposed Action on CO, VOC, NO_X, PM 2.5, and CO₂ emissions. Emission totals include upstream (refinery and distribution) and rebound-related emissions. While there is a decrease in upstream emissions for all criteria pollutants and greenhouse gases under the Proposed Action, this decrease is partially or completely offset by emissions attributed to the rebound effect. In particular, a net increase in lifetime emissions of CO and VOC will result.

Criteria Pollutant Emissions

As the analysis results show, the savings in gasoline use and the resulting reduction in CO emissions from gasoline refining and distribution grow over time. However, the increase in CO emissions from vehicle exhaust from added light truck use - resulting from the rebound effect - more than offsets this reduction. While CO emissions increase slightly under the Proposed Action, national CO concentrations have decreased and there are few non-attainment areas in the U.S. Therefore, the small increase in CO emissions - relative to national CO emissions from all vehicles - will be unlikely to result in new or more frequent yearly violations of the CO standard.

VOC emissions are projected to decline until calendar year 2010 as the increase in emissions from more intensive use of light trucks manufactured under the Proposed Action is offset by the reduction in emissions from lower gasoline refining and distribution. Starting in calendar year 2011 the situation is reversed and total VOC emissions are projected to increase slightly as a result of the rebound effect and the effect of degraded emissions performance from aging vehicles. This increase in VOC emissions is a small percentage of projected aggregate national VOC emissions for all vehicles. As presented above, the projected annual VOC emissions increases comprise at most 0.011 percent - in calendar year 2020 - of the VOC emissions projections for all vehicles during the study period.

NO_X emissions are projected to decline over the lifetime of MY 2005-2007 light trucks, and on an annual basis until calendar year 2014 as the increase in emissions from more intensive use of light trucks manufactured under the Proposed Action is offset by the reduction in emissions from lower gasoline refining and distribution. Starting in calendar year 2015 the situation is reversed and total NO_X emissions are projected to increase slightly as a result of the rebound effect and the effect of degraded emissions performance from aging vehicles. This post-2014 increase in NO_X emissions is an extremely small percentage of projected aggregate national NO_X emissions for all vehicles. As presented above, the projected annual NO_X emissions increases comprise at most 0.005 percent - in calendar year 2020 - of the NO_X emissions projections for all vehicles during the study period.

Under the Proposed Action, PM emissions decrease over the lifetime of MY 2005-2007 light trucks, as well as on an annual basis during the study period. The changes (decreases) are extremely small when compared to the projected aggregate national PM emissions.

Greenhouse Gas Emissions

Under the Proposed Action, GHG emissions decrease over the lifetime of MY 2005-2007 light trucks, as well as on an annual basis during the study period. The reduction in GHG emissions constitutes a benefit.

4.8.3. Fuel Consumption, Refinery Emissions, and Impacts on Water and Biological Systems

A decrease in fuel consumption can lead to environmental benefits through the reduction of oil exploration, drilling and extraction, transport, and refining. Oil exploration and drilling often require deep intrusion into natural habitats. Oil drilling and extraction require heavy equipment, pipelines, and drilling structures that can disrupt wildlife and human communities and may lead to deforestation. Thus, a decrease in oil drilling and extraction will have minor benefits to topographic and geological structures, which may be affected during onshore and offshore oil drilling. Offshore drilling can also contaminate sediments and lead to oil leakage into the water. Noise pollution from drilling can disrupt animals and humans. Oil drilling can also lead to oil spills and leakage, fires, and explosions, which can be harmful to wildlife and human health.

A decrease in fuel consumption can also lead to a decrease in oil transport. Accidental oil leaks and spills and pipeline bursts can occur between the point of extraction and the point of consumption. Oil leaks and spills and pipeline bursts can harm habitats, wildlife, coastal and inland waters, and human communities.

A decrease in fuel extraction would lead to a reduction in the amount of fuel refined. Chemicals used in the refinery process and byproducts produced in the refining process can be toxic to wildlife and humans. The physical presence of refineries can harm natural habitats, wildlife, and human communities through thermal pollution, water contamination, noise pollution, and air pollution. Workers are also exposed to these hazards on a daily basis (Epstein and Selber 2002).

Table 4-6. Summary of Baseline and Proposed Action Emissions

4.8.4. Cumulative Effects

The agency has considered the environmental effects of previous CAFE rulemakings. Under previous actions, the Agency has issued Environmental Assessments to evaluate environmental impacts. Cumulative impacts have been identified in the past by the Agency. Documents that address these impacts have been placed in the docket.

5.0 LIST OF PREPARERS AND REVIEWERS

PREPARERS

U.S. DOT, John A. Volpe National Transportation Systems Center

University of South Florida

EG&G Technical Services, Inc.

REVIEWERS

U.S. DOT, National Highway Traffic Safety Administration (NHTSA)

6.0 List of AGENCIES CONSULTED

Council on Environmental Quality

U.S. Department of Energy

U.S. Environmental Protection Agency

7.0 REFERENCES

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CTA 2001. Transportation Energy Data Book: Edition 21. Center for Transportation Analysis, U.S. Department of Energy. http://www-cta.ornl.gov/data/.

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DOE 2002a. Annual Energy Outlook 2002, Table 45. U.S. Department of Energy, Energy Information Administration. http://www.eia.doe.gov/oiaf/aeo/supplement/index.html.

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EIA 2002b. Annual Energy Outlook 2002. Report No. DOE/EIA-0383 2002. Energy Information Administration, U.S. Department of Energy. http://www.eia.doe.gov/oiaf/aeo/.

EIA 2002c. Analysis of Corporate Average Fuel Economy (CAFE) Standards for Light Trucks and Increased Alternative Fuel Use. Energy Information Administration. SR/OIAF/2002-05. Washington, D.C., March 2002.

EPA 1998a. Update of Fleet Characterization Data for Use in MOBILE6—Final Report. Table 4-5. Arcadis, Geraghty & Miller. EPAA420-P-98-016. p. 4-35. June 1998

http://www.epa.gov/otaq/models/mobile6/m6flt002.pdf.

EPA 1998b. National Air Pollutant Emissions Trends: 1900-1998. U.S. Environmental Protection Agency. http://www.epa.gov/ttn/chief/trends/trends98/.

EPA 1999a. Draft Inventory of GHG Emissions and Sinks (1990-1999), Tables ES-1 and ES-4, U.S. Environmental Protection Agency. http://www.epa.gov/globalwarming/publications/emissions/us2001/energy.pdf.

EPA 1999b. National Air Quality and Emissions Trends Report, 1999. U.S. Environmental Protection Agency. http://www.epa.gov/oar/aqtrnd99/.

EPA 2001. Latest Findings on National Air Quality: 2000 Status and Trends. U.S. Environmental Protection Agency. http://www.epa.gov/oar/aqtrnd00/.

EPA 2002a. MOBILE Model (on-road vehicles). Office of Transportation and Air Quality, U.S. Environmental Protection Agency. http://www.epa.gov/otaq/mobile.htm.

EPA 2002b. EPA Global Warming Site. U.S. Environmental Protection Agency. http://www.epa.gov/globalwarming/index.html.

EPA 2002c. EPA National Ambient Air Quality Standards (NAAQS). U.S. Environmental Protection Agency. http://www.epa.gov/airs/criteria.html.

EPA 2002d. Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2000. U.S. Environmental Protection Agency. http://www.epa.gov/oppeoee1/globalwarming/publications/emissions/us2002/.

Epstein, Paul R. and Selber, Jesse, ed. 2002. Oil: A Life Cycle Analysis of its Health and Environmental Impacts. Boston: The Center for Health and the Global Environment.

FHWA 2000. Highway Statistics 2000. Federal Highway Administration, U.S. Department of Transportation. http://www.fhwa.dot.gov/ohim/hs00/.

Freeman, Harry M. 1995. Industrial Pollution Prevention Handbook. United States: McGraw-Hill, Inc. pp.740.

Goldberg, Pinelopi Koujianou Goldberg, "The Effects of the Corporate Average Fuel Efficiency Standards in the U.S.," The Journal of Industrial Economics, 46:1 (1998), 1-33.

Greene, David L., "Vehicle Use and Fuel Economy: How Big is the Rebound Effect?" The Energy Journal, 13:1 (1992), 117-143.

Greene, David L., Donald W. Jones, and Paul N. Leiby, The Outlook for U.S. Oil Dependence, ORNL-6873, Oak Ridge National Laboratory, May 11, 1995.

Greene, David L., James R. Kahn, and Robert C. Gibson, "Fuel Economy Rebound Effect for Household Vehicles," The Energy Journal, 20:3 (1999), 1-31.

Greene, David L., and Nataliya I. Tishchishyna, Costs of Oil Dependence: A 2000 Update, ORNL/TM-2000/152, Oak Ridge National Laboratory, May 2000.

Haughton, Jonathan, and Soumodip Sarkar, "Gasoline Tax as a Corrective Tax: Estimates for the United States," The Energy Journal, 17:2, 103-126.

Jones, Clifton T., "Another Look at U.S. Passenger Vehicle Use and the ‘Rebound’ Effect from Improved Fuel Efficiency, The Energy Journal, 14:4 (1993), 99-110.

Lave, Charles and Lave, Lester 1999. "Fuel Economy and Auto Safety Regulation: Is the Cure Worse than the Disease", Essays in Transportation Economics and Policy. Washington D.C.: Brookings Institution Press.

Leiby, Paul N., Donald W. Jones, T. Randall Curlee, and Russell Lee. 1997. Oil Imports: An Assessment of Benefits and Costs, ORNL-6851. Oak Ridge National Laboratory. November 1, 1997.

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NHTSA 1987. Final Environmental Impact Statement for the Corporate Average Fuel Economy Standards for Light Trucks, Model Years 1985-1987.

NHTSA 1997. The Effect of Decreases in Vehicle Weight on Injury Crash Rates. National Highway Traffic Safety Administration, U.S. Department of Transportation. http://www.nhtsa.dot.gov/people/ncsa/pdf/sizerept.pdf.

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NHTSA 2002b. Preliminary Economic Assessment. September 2002.

NHTSA, 2002c. Personal communication from NHTSA with Kevin Green of the Volpe National Transportation Systems Center. July 2002.

Pickrell, Don H., "Description of VMT Forecasting Procedure for ‘Car Talk’ Baseline Forecasts," manuscript, Volpe National Transportation Systems Center, U.S. Department of Transportation, 1994.

Ward’s 2002. Ward’s Reference Center. Ward’s Communications. http://wardsauto.com.

List of Appendices

Appendix A. Analytical Methodology

Appendix B. Energy

Appendix C. Air Quality

Appendix A - ANALYTICAL Methodology

This section outlines the methodology used to estimate the environmental impacts associated with the Proposed Action, compared to the baseline (20.7 mpg). Most environmental impacts considered in this analysis would result from reductions in gasoline use due to the higher fuel economy of new light trucks produced during the model years in question. Environmental impacts from increased CAFE standards include reductions in emissions of carbon dioxide and other "greenhouse" gases resulting from reduced gasoline refining and use. Additionally, net changes in emissions of regulated or "criteria" air pollutants would result from increased light truck use and reduced gasoline refining.

Potential environmental impacts were estimated separately for each model year light truck over its life span in the U.S. vehicle fleet. The life span of a light truck extends from the initial year when it is offered for sale, typically late in the preceding calendar year, until the time when nearly all vehicles from that model year have been scrapped or retired from service, assumed to be 25 years after the vehicle is first sold. Each environmental impact is measured by determining the difference in a variable -- such as total gallons of fuel consumed by light trucks of a single model year during a future calendar year -when comparing the fuel economy under the Proposed Action with the baseline standard of 20.7 mpg. These estimated impacts are calculated and reported separately both for light trucks manufactured during each model year from 2005 through 2007, and for each future calendar year during which those vehicles remain in the U.S. vehicle fleet. Environmental impacts from tighter CAFE standards aggregated for each model year over its expected life span are reported in both undiscounted terms and as their present value discounted to the year when each model year is first offered for sale.

Table A-1 summarizes the main assumptions and parameters used in the analysis.

Table A-1. Summary of Main Assumptions and Parameters

Variable	Value	Source
Light Truck Sales (millions):		Energy Information Administration, Annual Energy Outlook 2002, Table 45.
Model Year 2005	7.65
Model Year 2006	7.80
Model Year 2006	7.92
Light Truck Sales Shares (all model years)		Light truck manufacturers’ submissions to NHTSA.
under 6,000 lbs. Gross Vehicle Weight	59%
6,000-8,500 lbs. Gross Vehicle Weight	41%
"Gap" between test and on-road MPG	15%	U.S. EPA
"Rebound" effect	15%(1)	Greene et al., "Fuel Economy Rebound Effect for U.S. Household Vehicles," The Energy Journal, Volume 20 (1999), pp. 1-31.
Discount rate applied to future benefits	7.0%	Office of Management and Budget
Share of reduction in fuel use attributed to reduced imports of gasoline	55%	Derived from Energy Information Administration, Annual Energy Outlook 2002.
Share of reduction in fuel use attributed to reduced domestic gasoline refining	45%
Light truck emission rates for criteria pollutants (grams/vehicle-mile)	Vary by model year	Estimated by Volpe Center using U.S. EPA, MOBILE6.1/6.2 Motor Vehicle Emission Factor Model.
Light truck emission rates for greenhouse gases (carbon equivalent in grams per gallon of gasoline consumed)	2,366	Derived from gasoline specifications reported in Argonne National Laboratory, Greenhouse Gas and Regulated Emissions in Transportation (GREET) Model, Technical Documentation, February 2002, Table 3.3.
Criteria pollutant and greenhouse emission rates for gasoline refining and distribution (grams/gallon)	Vary by pollutant	Estimated by Volpe Center using Argonne National Laboratory, Greenhouse Gas and Regulated Emissions in Transportation (GREET) Model, version 6.2.
Light truck usage	Varies by vehicle age	NHTSA.
Light truck survival rates	Vary by vehicle age	Oak Ridge National Laboratory, Transportation Energy Data Book, Volume 21, Table 6.10.

Variables

Sales and Populations. Forecasts of light truck sales for future calendar years were obtained from the Energy Information Administration’s (EIA) Annual Energy Outlook 2002 (AEO 2002), a standard government reference for forecasts of energy production and consumption in different sectors of the U.S. economy (DOE 2002a). Forecasted light truck sales during each calendar year were allocated between the model years expected to be offered for sale during each calendar year, on the basis of dates when new model years are typically introduced, and recent monthly sales patterns for light trucks. For example, both model year 2006 and 2007 light trucks will be sold at different times during calendar year 2006, although sales of the two model years may overlap for some time after the new model year is introduced. The number of light trucks manufactured during each model year that remains in service during each subsequent calendar year is estimated by applying estimates of the proportion of vehicles initially produced and sold during a model year that remain in service at each age up to 25 years, by which time only a small fraction of vehicles initially sold during an earlier model year typically remain in service. These "survival rates" are based on experience with recent model-year light trucks (NHTSAPEA XXXX). Separate survival rates for each vehicle age are employed for two weight classes of light trucks, those under 6,000 pounds gross vehicle weight (GVW), and those from 6,001-8,500 pounds GVW, the upper weight limit for vehicles currently classified as light trucks for fuel economy standards (DOE 2002b).

Light Truck Fuel Economy. Actual fuel economy levels for each future model year’s light trucks under the Proposed Action and the Baseline were estimated. Under the Baseline and under the Proposed Action, average actual fuel economy for all new light trucks manufactured during each model year slightly exceeds the applicable standard, as measured using the U.S. government fuel economy testing procedures. However, actual fuel economy levels achieved by light trucks in on-road driving falls significantly short of the level measured under these test conditions, and the actual fuel economy performance of each model year’s light trucks is adjusted to reflect the expected size of this fuel economy "gap" in future calendar years (DOE 2002c).

Light Truck Usage and Total Miles Driven. The total number of miles driven by light trucks of each model year during each year of its life span in the fleet with the baseline standard of 20.7 mpg in effect is estimated by multiplying age-specific estimates of annual miles driven per vehicle by the number of vehicles of that model year remaining in service at each age. The age of a given model year vehicle during any future calendar year is equal to the difference between that calendar year and the model year, plus one. For example, a model year 2005 vehicle is defined to be 10 years old during calendar year 2014. The measures of annual miles driven per vehicle for light trucks of various ages used in this analysis reflect experience with actual use of recent model year light trucks; separate estimates of annual use at different ages for light trucks under 6,000 pounds GVW and those of 6,001-8,500 pounds GVW are again employed (EPA 1998a).

By reducing the cost of gasoline per mile driven, tighter CAFE standards result in a slight increase in annual miles driven per vehicle. This increase in the annual number of miles each vehicle is driven, often referred to as the "rebound effect," also produces a corresponding increase in the total number of miles driven by light trucks of each model year during each subsequent calendar year they remain in the fleet. The magnitude of the rebound effect is calculated by applying a representative estimate of the elasticity of vehicle use with respect to fuel cost per mile driven to the percentage reduction in that cost that would result from requiring light trucks to achieve higher fuel economy than the 20.7 mpg Baseline standard. Recent estimates of the rebound effect resulting from higher fuel economy standards for light-duty vehicles indicate that a 10% reduction in fuel costs per mile results in a 1-2% increase in the number of miles driven.^[6] The average fuel cost per mile for operating light trucks of any model year during a subsequent calendar year is calculated from the forecasted retail price of gasoline during that future year, divided by the average actual on-road fuel economy level achieved by light trucks of that model year at either the Baseline or with a stricter CAFE standard in effect during the year that vehicle was produced (DOE 2002d).

Fuel Savings. At the Baseline standard, total fuel consumption by light trucks from a single model year during each calendar year remaining in service is calculated by dividing the total number of miles driven by the surviving population of vehicles of that model year by the average on-road fuel economy expected to be achieved if the vehicles are manufactured to comply with the Baseline 20.7 mpg standard. If that same model year’s light trucks are required to meet a higher CAFE standard, their total fuel consumption during each subsequent calendar year is calculated by dividing the increased number of miles they are driven as a result of the rebound effect by the higher on-road fuel economy level they achieve during each year of their life span in the fleet as a result of being initially required to comply with that stricter CAFE standard.

The difference between estimated total fuel use by light trucks of a given model year during each calendar year with the Baseline standard in effect and under a stricter standard represents the fuel savings attributable to tightening the standard to that higher level. The sum of these annual fuel savings over each calendar year represents the total fuel savings resulting from applying a stricter CAFE standard to light trucks produced during that model year. Similarly, total fuel savings resulting from an increased CAFE standard during any future calendar year are equal to the sum of fuel savings produced by light trucks of each model year remaining in the fleet that was initially required to comply with the higher standard.

Environmental Impacts of Reduced Gasoline Use

Environmental impacts from petroleum use occur primarily as a result of petroleum refining and the distribution and combustion of petroleum products such as gasoline. These impacts include emissions of greenhouse gases, which are widely believed to increase the potential for global climate change, and emissions of regulated or "criteria" air pollutants, which can adversely affect human health and damage property in sufficient concentrations. Emissions of greenhouse gases and criteria pollutants occur during petroleum refining, as well as during the subsequent distribution and consumption of petroleum products such as gasoline. Tighter CAFE standards for light-duty trucks will reduce gasoline consumption and the amount of petroleum refined, and both of these effects will in turn reduce emissions of greenhouse gases. While reduced gasoline refining will also lower emissions of criteria pollutants, the increased use of light trucks that results from improving their fuel economy (the rebound effect) will raise emission of these pollutants. Therefore, tighter CAFE standards can reduce or increase emissions of criteria pollutants.

Reductions in Greenhouse Gas Emissions. Fuel savings from stricter light truck CAFE standards will result in lower emissions of carbon dioxide, the main greenhouse gas emitted as a result of refining, distribution, and use of transportation fuels (EPA 1999a). Lower fuel consumption reduces carbon dioxide emissions directly because the primary source of these emissions is fuel use in internal combustion engines, which convert stored fuel energy into vehicle propulsion energy. This analysis calculates reductions in carbon dioxide emissions from vehicle operation by assuming that the entire carbon content of gasoline is converted to carbon dioxide in the combustion process. This assumption results in an overestimate of carbon dioxide emissions, since a small fraction of the carbon content of gasoline is emitted in the form of carbon monoxide and unburned hydrocarbons. However, the magnitude of this overestimate is likely to be extremely small. At the same time, lower fuel consumption also reduces carbon dioxide emissions resulting from fuel combustion and other energy use that occurs during the refining and distribution of gasoline. Reductions in emissions from these activities are calculated using estimates of carbon dioxide emission rates per unit of fuel energy refined and distributed for retail sale (Argonne 2002).

Changes in Criteria Pollutant Emissions. Stricter CAFE standards can result in higher or lower emissions of "criteria" pollutants, by-products of fuel combustion that are emitted by internal combustion engines and by gasoline refining and distribution. Criteria pollutants emitted by light-duty motor vehicles include carbon monoxide, various hydrocarbon compounds, nitrogen oxides, and fine particulate matter. A higher fuel economy standard may increase the use of light trucks (the "rebound effect"). This in turn would cause increased emissions of criteria pollutants, since federal standards regulate permissible emissions of these pollutants on a per-mile basis. Conversely, reductions in gasoline consumption and refining from stricter light truck CAFE standards will lower emissions of criteria pollutants that occur during refining, distribution, and retailing of gasoline (Argonne 2002).

Additional emissions of these pollutants from vehicle operation are estimated by multiplying the increase in total miles driven by light trucks of each model year and age during a calendar year by per-mile emission rates for each of these four pollutants (EPA 2002a). Future changes in air pollutant emission standards for light trucks, notably the "Tier 2" emission standards for light-duty vehicles that are scheduled to take effect beginning in model year 2004, will cause emissions of criteria pollutants to vary among light trucks manufactured during the specific model years included in this analysis. Because each future year’s light truck fleet will include a different mix of vehicles produced during these model years, the increase in emissions of criteria pollutants caused by "rebound effect" driving will vary over future years.

The reduction in emissions is estimated by applying emission factors for each criteria pollutant per unit of fuel energy refined to the reduction in gasoline use (expressed in terms of its total energy content) resulting from an increase in light truck CAFE standards. Each future year’s estimate of reductions in criteria pollutant emissions from reduced gasoline refining is combined with the annual change in emissions from increased light truck use to determine the annual net change in emissions of each pollutant. On balance, emissions of some criteria pollutants are likely to increase as a result of stricter CAFE standards, as increased emissions during vehicle operation outweigh the reduction in emissions from gasoline refining and distribution, while the opposite situation occurs for other criteria pollutants, thus lowering their total emissions. However, the pattern of these net changes in criteria emissions varies, both over future years and among individual pollutants during any year.

Appendix B - Energy

This Appendix presents detailed information on energy consumption resulting from revised CAFE standards. This section serves as a complement to the general energy information provided in the Energy Section in Chapter 3 (Section 3.1) and the Energy Section in Chapter 4 (Section 4.1).

Background

Based on the methodology described in Appendix A, a yearly analysis of gasoline consumption was developed for calendar years 2004-2031 under the Baseline and Proposed Action.

The numbers in these yearly calculations are aggregated across MY 2005-2007. Thus, the calendar year 2005 energy consumption value includes MY 2005 and MY 2006 light trucks sold and operated in calendar year 2005, the calendar year 2006 consumption value includes MY 2005 light trucks operating in calendar year 2006 plus MY 2006 and 2007 light trucks sold and operating in calendar year 2006, and the calendar year 2007 consumption value includes MY 2005, MY 2006, and MY 2007 light trucks operating in calendar year 2007. Similarly the calendar years 2008 through 2031 values include the MY 2005-2007 light trucks still operating at each respective year.

Table B-1 shows the total amount of energy consumed by MY 2005-2007 light trucks on an annual basis under the Baseline for the calendar years 2004-2031.

Table B-2 shows the total amount of energy consumed by MY 2005-2007 light trucks on an annual basis under the Proposed Action for the calendar years 2004-2031.

Table B-3 shows the total reduction in energy consumed by MY 2005-2007 light trucks on an annual basis under the Proposed Action for the calendar years 2004-2031.

Table B-1. Annual Fuel Use - Baseline (million gallons)

Table B-2. Annual Fuel Use - Proposed Action (million gallons)

Table B-3. Reduction in Gasoline Use under Proposed Action (million gallons)

Appendix C - Air Quality

This section presents detailed information on criteria pollutants, air quality health effects, current state of the environment, source characteristics, and changes in emissions under revised CAFE standards. This section serves as a complement to the general air quality information provided in the Air Quality Section in Chapter 3 (Section 3.2) and the Air Quality Section in Chapter 4 (Section 4.2).

Background

Table C-1 shows the primary and secondary standards used to regulate air pollution in the U.S. The standards for short term averages (i.e., less than 24 hours) are devised to protect the public from short term exposures resulting in adverse health effects, and the standards for long term averages (i.e., annual) are devised to protect the public from both short term and prolonged exposures (EPA 2001).

Table C-1. National Ambient Air Quality Standards

Pollutant	Standard Value		Standard Type
Carbon Monoxide
8-Hour Average	9 ppm	(10 mg/m3)	Primary
1-Hour Average	35 ppm	(40 mg/m3)	Primary
Nitrogen Dioxide (NO2)
Annual Arithmetic Mean	0.053 ppm	(100 μg/m3)	Primary & Secondary
Ozone (O3)
1-Hour Average	0.12 ppm	(235 μg/m3)	Primary & Secondary
Lead (Pb)
Quarterly Average	1.5 μg/m3		Primary & Secondary
Particulate Matter (PM 10) Particles with diameters of 10 micrometers or less
Annual Arithmetic Mean	50 μg/m3		Primary & Secondary
24-Hour Average	150 μg/m3		Primary & Secondary
Particulate Matter (PM 2.5) Particles with diameters of 2.5 micrometers or less
Annual Arithmetic Mean	15 μg/m3		Primary & Secondary
24-Hour Average	65 μg/m3		Primary & Secondary
Sulfur Dioxide (SO2)
Annual Arithmetic Mean	0.03 ppm	(80 μg/m3)	Primary
24-Hour Average	0.14 ppm	(365 μg/m3)	Primary
3-Hour Average	0.50 ppm	(1300 μg/m3)	Secondary
Parenthetical value is an approximately equivalent concentration.
Source: EPA 2002c

Criteria Pollutants

Carbon Monoxide (CO)

Carbon monoxide is a colorless, odorless, poisonous gas formed when carbon in fuels is not burned completely. It is a byproduct of highway vehicle exhaust, which contributes about 60 percent of all CO emissions nationwide. In cities, automobile exhaust can cause as much as 95 percent of all CO emissions. Other sources of CO emissions include industrial processes and fuel combustion in sources such as boilers and incinerators.

Carbon monoxide enters the bloodstream and reduces oxygen delivery to the body's organs and tissues. The health threat from exposure to CO is most serious for those who suffer from cardiovascular disease. Healthy individuals are also affected, but only at higher levels of exposure. Exposure to elevated CO levels is associated with visual impairment, reduced work capacity, reduced manual dexterity, poor learning ability, and difficulty in performing complex tasks. EPA's health-based national air quality standard for CO is 9 ppm measured as an annual second-maximum 8-hour average concentration.

Nationally, the 2000 ambient average CO concentration is 61 percent lower than it was in 1981 and is the lowest level recorded during the past 20 years. CO emissions levels decreased 18 percent over the same period. Between 1991 and 2000, ambient CO concentrations decreased 41 percent, and the estimated number of violations of the national standard decreased 95 percent while CO emissions fell 5 percent. This improvement occurred despite a 24 percent increase in vehicle miles traveled in the United States during this 10-year period (EPA 2001).

Lead (Pb)

Prior to the enactment of EPA regulations that reduced the content of lead in gasoline during the late 1970s and early 1980s, the primary source of lead emissions in the U.S. was the automobile. Now smelters and battery plants are the major sources of lead in the air. The highest concentrations of lead are found in the vicinity of nonferrous smelters and other stationary sources of lead emissions.

Exposure to lead mainly occurs through inhalation of air and ingestion of lead in food, paint, water, soil, or dust. Lead accumulates in the body in blood, bone, and soft tissue. Because it is not readily excreted, lead can also affect the kidneys, liver, nervous system, and other organs. Excessive exposure to lead may cause anemia, kidney disease, reproductive disorders, and neurological impairments such as seizures, mental retardation, and/or behavioral disorders. Even at low doses, lead exposure is associated with changes in fundamental enzymatic, energy transfer, and other processes in the body. Fetuses and children are especially susceptible to low doses of lead, often suffering central nervous system damage or slowed growth. Recent studies show that lead may be a factor in high blood pressure and subsequent heart disease in middle-aged white males. Lead may also contribute to osteoporosis in post-menopausal women. EPA's health-based national air quality standard for lead is 1.5 µg/m³ measured as an annual maximum quarterly average concentration.

Because of the phase-out of leaded gasoline, lead emissions and concentrations decreased sharply during the 1980s and early 1990s. The 2000 average air quality concentration for lead is 93 percent lower than in 1981. Emissions of lead decreased 94 percent over that same 20-year period. Today, the only violations of the national air quality standard for lead occur near large industrial sources such as lead smelters (EPA 2001).

Nitrogen Dioxide (NO₂)

Nitrogen dioxide belongs to a family of highly reactive gases called nitrogen oxides (NO_X). These gases form when fuel is burned at high temperatures, and come principally from motor vehicle exhaust and stationary sources such as electric utilities and industrial boilers. A suffocating, brownish gas, nitrogen dioxide is a strong oxidizing agent that reacts in the air to form corrosive nitric acid, as well as toxic organic nitrates. It also plays a major role in the atmospheric reactions that produce ground-level ozone (or smog).

Nitrogen dioxide can irritate the lungs and lower resistance to respiratory infections such as influenza. The effects of short-term exposure are still unclear, but continued or frequent exposure to concentrations that are typically much higher than those normally found in the ambient air may cause increased incidence of acute respiratory illness in children. EPA's health-based national air quality standard for NO₂ is 0.053 ppm (measured as an annual arithmetic mean concentration). Nitrogen oxides contribute to ozone formation and can have adverse effects on both terrestrial and aquatic ecosystems. Nitrogen oxides in the air can significantly contribute to a number of environmental effects such as acid rain and eutrophication in coastal waters like the Chesapeake Bay. Eutrophication occurs when a body of water suffers an increase in nutrients that leads to a reduction in the amount of oxygen in the water, producing an environment that is destructive to fish and other animal life.

Over the past 20 years, monitored levels of NO₂ have decreased 14 percent. All areas of the country that once violated the national air quality standard for NO₂ now meet that standard. While levels around urban monitors have fallen, national emissions of nitrogen oxides have actually increased over the past 20 years by 4 percent. This increase is the result of a number of factors, the largest being an increase in nitrogen oxides emissions from diesel vehicles. This increase is of concern because NOx emissions contribute to the formation of ground-level ozone (smog) and other environmental problems, like acid rain and nitrogen loadings to water bodies (EPA 2001).

Ozone (O₃)

Ground-level ozone (the primary constituent of smog) is the most complex, difficult to control, and pervasive of the six principal air pollutants. Unlike other pollutants, ozone is not emitted directly into the air by specific sources. Sunlight acting on NOx and VOC in the air creates ozone. There are many sources of these gases. Some of the common sources include gasoline vapors, chemical solvents, combustion products of fuels, and consumer products. Emissions of NO_X and VOC from motor vehicles and stationary sources can be carried hundreds of miles from their origin, and result in high ozone concentrations over very large regions.

Scientific evidence indicates that ground-level ozone not only affects people with impaired respiratory systems (such as asthmatics), but healthy adults and children as well. Exposure to ozone for 6 to 7 hours, even at relatively low concentrations, significantly reduces lung function and induces respiratory inflammation in normal, healthy people during periods of moderate exercise. It can be accompanied by symptoms such as chest pain, coughing, nausea, and pulmonary congestion. Recent studies provide evidence of an association between elevated ozone levels and increases in hospital admissions for respiratory problems in several U.S. cities. Results from animal studies indicate that repeated exposure to high levels of ozone for several months or more can produce permanent structural damage in the lungs. EPA's health-based national air quality standard for ozone is currently set at 0.12 ppm (measured as the second daily 1-hour maximum concentration). Ozone is responsible for approximately 1 to 2 billion dollars of agricultural crop yield loss (by a disrupting process that can significantly suppress photosynthesis) in the U.S. each year. Ozone also damages forest ecosystems in California and the eastern U.S.

Over the past 20 years, national ambient ozone levels decreased 21 percent based on 1-hour data, and 10 percent based on 8-hour data. Between 1981 and 2000, emissions of VOCs have decreased 32 percent. During that same time period, emissions of NOx increased 4 percent. Because sunlight and heat play a major role in ozone formation, changing weather patterns contribute to yearly differences in ozone concentrations. To better reflect the changes that emissions have on measured air quality concentrations, EPA is able to make analytical adjustments to account for this annual variability in meteorology. For 52 metropolitan areas, the adjusted trend for 1-hour ozone levels shows improvement over the 20-year period from 1981-2000. However, beginning in 1994, the rate of improvement appears to level off and the trend in the last 10 years is relatively flat (EPA 2001).

Particulate Matter (PM)

Particulate matter is the term for solid or liquid particles found in the air. Some particles are large or dark enough to be seen as soot or smoke. Others are so small they can be detected only with an electron microscope. Because particles originate from a variety of mobile and stationary sources (diesel trucks, woodstoves, power plants, etc.), their chemical and physical compositions vary widely. Particulate matter can be directly emitted or can be formed in the atmosphere when gaseous pollutants such as SO₂ and NO_X react to form fine particles.

PM 2.5 describes the "fine" particles that are less than or equal to 2.5 micrometers in diameter. PM 10 describes "coarse" particles that are greater than 2.5, but less than or equal to 10 micrometers in diameter. EPA’s health-based national air quality standards for PM 2.5 are set at 15 µg/m³ (measured as an annual mean) and 65 µg/m³ (measured as a daily concentration). EPA’s health-based national air quality standards for PM 10 are 50 µg/m³ (measured as an annual mean) and 150 µg/m³ (measured as a daily concentration). Major concerns for human health from exposure to PM include: effects on breathing and respiratory systems, damage to lung tissue, cancer, and premature death. The elderly, children, and people with chronic lung disease, influenza, or asthma, are especially sensitive to the effects of particulate matter. Acidic PM can also damage human-made materials and is a major cause of reduced visibility in many parts of the U.S.

Because the national monitoring network started in 1999, there is not enough data to show a national long-term trend in urban PM2.5 air quality concentrations. However, 36 sites in the network (10 in the East, and 26 in the West) have enough data to assess trends in average rural PM2.5 concentrations from 1992-1999. In the East, where sulfates contribute most to PM2.5, the annual average across the 10 sites decreased 5 percent from 1992-1999. The peak in 1998 is associated with increases in sulfates and organic carbon. Average PM2.5 concentrations across the 26 sites in the West from 1992-1999 were about one-half of the levels measured at Eastern sites.

Sites in the East typically have higher annual average PM2.5 concentrations. Most of the regional difference is attributable to higher sulfate concentrations in the eastern United States. Sulfate concentrations in the eastern sites are 4 to 5 times greater than those in the western sites. Sulfate concentrations in the East largely result from sulfur dioxide emissions from coal-fired power plants. In the West, rural PM2.5 levels are generally less than one-half of Eastern levels (EPA 2001).

Sulfur Dioxide (SO₂)

Sulfur dioxide belongs to the family of gases called sulfur oxides (SO_X). These gases are formed when fuel containing sulfur (mainly coal and oil) is burned, and during metal smelting and other industrial processes.

The major health concerns associated with exposure to high concentrations of SO₂ include effects on breathing, respiratory illness, alterations in pulmonary defenses, and aggravation of existing cardiovascular disease. Children, the elderly, and people with asthma, cardiovascular disease or chronic lung disease (such as bronchitis or emphysema), are most susceptible to adverse health effects associated with exposure to SO₂. EPA's health-based national air quality standard for SO₂ is 0.03 ppm (measured on an annual arithmetic mean concentration) and 0.14 ppm (measured over 24 hours). SO₂ is a precursor to sulfates, which are associated with acidification of lakes and streams, accelerated corrosion of buildings and monuments, reduced visibility, and adverse health effects.

Nationally, average SO₂ ambient concentrations have decreased 50 percent from 1981-2000 and 37 percent over the more recent 10-year period 1991-2000. SO₂ emissions decreased 31 percent from 1981 to 2000 and 24 percent from 1991- 2000. Reductions in SO₂ concentrations and emissions since 1994 are due, in large part, to controls implemented under EPA’s Acid Rain Program beginning in 1995 (EPA 2001).

Greenhouse Gases

Carbon Dioxide (CO₂)

The global carbon cycle is made up of large carbon flows and reservoirs. Hundreds of billions of tons of carbon in the form of CO2 are absorbed by oceans and living biomass (sinks) and are emitted to the atmosphere annually through natural processes (sources). When in equilibrium, carbon fluxes among these various reservoirs are roughly balanced. However, since the Industrial Revolution, this equilibrium of atmospheric carbon has been altered. Atmospheric concentrations of CO2 have risen principally because of fossil fuel combustion, which accounted for almost 98 percent of total U.S. CO2 emissions in 1998. Changes in land use and forestry practices can also result in the emission of CO2 (e.g., through conversion of forest land to agricultural or urban use) or can act as a sink for CO2 (e.g., through net additions to forest biomass).

Increasing concentrations of greenhouse gases are likely to accelerate the rate of climate change. Scientists expect that the average global surface temperature could rise 1-4.5°F (0.6-2.5°C) in the next fifty years, and 2.2-10°F (1.4-5.8°C) in the next century, with significant regional variation. Evaporation will increase as the climate warms, which will increase average global precipitation. Soil moisture is likely to decline in many regions, and intense rainstorms are likely to become more frequent. Sea level is likely to rise two feet along most of the U.S. coast.

Transportation activities - excluding international bunker fuels - accounted for 31 percent of CO2 emissions from fossil fuel combustion in 1999 in the United States. Virtually all of the energy consumed in this end-use sector came from petroleum products. Just under two thirds of the emissions resulted from gasoline consumption in motor vehicles. The remaining emissions came from other transportation activities, including the combustion of diesel fuel in heavy-duty vehicles and jet fuel in aircraft (EPA 2002b).

Summary Tables for Criteria Pollutants and CO₂

The formation of criteria pollutants and carbon dioxide are presented in Table C-2. The health effects can be categorized into two general categories, acute and chronic. Acute or short-term effects usually include irritations, headaches, and nausea. Chronic or long-term effects may include decreased lung capacity and cancer (EPA 2001, 2002b).

Table C-2. Criteria Pollutant Descriptions and Potential Health Effects

Pollutant	Pollutant Description	Potential Health Effects
CO	Colorless, odorless gas that is caused by incomplete carbon combustion	CO acts as an asphyxiant by interfering with the blood's ability to carry oxygen from the lungs to the rest of the body. It can impair the brain's ability to function properly and is a threat especially to individuals with cardiovascular disease.
Pb	Solid emitted usually as an inorganic particle from any processors that use lead such as smelters, battery manufactures, etc.	Inhalation and/or congestion can result in behavioral changes, learning disabilities, seizures, severe and permanent brain damage, and death.
NO2	Reddish-brown, highly reactive gas formed from high temperature combustion through reactions involving N2 and oxygen.	NO2 can irritate lungs, cause bronchitis and pneumonia, and impair an individual's resistance to infections.
O3	Gas that is formed by VOCs and NOX in the presence of heat and sunlight.	Exposure to O3 can cause chest constrictions and irritations of the mucous membranes.
PM	Particulate matter either solid or liquid usually in the range of 0.005 to 100 micrometers in aerodynamic diameter. Other related terms include aerosols, dust, fumes, soot, etc.	In general, the smaller the PM, the deeper it can penetrate into the respiratory system, and the more damage it can cause. Depending on the size and composition, PM can damage lung tissue, aggravate existing respiratory and cardiovascular diseases, and cause cancer.
SO2	Gas formed when fuels containing sulfur are burned (combusted).	As a gas, it is highly soluble in water and will likely be trapped in the upper respiratory tract causing irritations but less long-term damage. When entrained in an aerosol, SO2 can reach far deeper into the respiratory system causing severe respiratory distress.
CO2	Gas released to the atmosphere when solid waste, fossil fuels (oil, natural gas, and coal), and wood and wood products are burned.	Increase in greenhouse gases can lead to climate change. Hot temperatures can lead to cardiovascular problems, heat exhaustion, and some respiratory problems. There may be an increased risk of infectious diseases due to increased temperatures. Heat can also increase the concentration of ground-level ozone.

Table C-3 presents the contribution of different sectors of the U.S. economy to total emissions of criteria pollutants and carbon dioxide. Transportation emissions include all ground, air, and water transportation systems.

Table C-3. Source Contribution to Emissions for the United States during 1999

Pollutant	Percent Source Contribution
	Transportation	Industrial Processes	Fuel Combustion	Miscellaneous
CO	77.1	7.8	5.5	9.6
Pb	12.8	75.3	11.9	0.0
NO2	55.5	3.7	39.5	1.3
VOC	47.0	44.1	5.0	3.9
PM 10	24.7	41.5	33.8	0.0
SO2	6.9	7.8	85.3	0.1
	Transportation	Industrial	Residential	Commercial
CO2*	31	33	19	16
Source: EPA 1999b
* Source: EPA 2002b

Table C-4 shows the changes in emissions and concentrations of pollutants in the U.S. for the last 20 years.

Table C-4. Percent Changes in Emissions and Concentration of Pollutants

Pollutant	Percent Change in Emissions	Percent Change in Atmospheric Concentrations
CO	-21	-57
Pb	-94	-94
NO2	+4	-25
VOC/O3	-31a	-12b
PM 10	-15c	-18c
SO2	-27	-50
a Emissions of VOCs b Concentration of O3 for 8-hr c For 1990-1999
Source: EPA 2001

Table C-5 presents a summary of the contribution of the different types of on-road vehicles to total vehicle emissions in the United States. Vehicles are classified according to size and fuel type.

Table C-5. Total Emissions from On-Road Mobile Sources in 1999

Pollutant	Total Emissions by Vehicle Category (thousand short tons)					Total from all Sources(f)
	LDGV(a)	LDGT(b)	HDGV©	Diesels(d)	Total On-Road Vehicles(e)
CO	27,382	16,115	4,262	2,230	49,989	88,063
Pb	14	7	1	0	22	4,199
NO2	2,859	1,638	459	3,635	8,590	25,393
VOC	2,911	1,722	375	289	5,297	18,145
PM 10	59	36	12	189	295	23,679
SO2	137	91	17	118	363	18,867
	Total Emissions by Vehicle Category (Tg CO2 Eq.)
	Passenger Cars		Light Trucks		Other Trucks	Total from all Sources(f)
CO2*	687.2		366.5		282.4	5558.1
(a)LDGV = Light Duty Gas Vehicle (Includes motorcycles) (b)LDGT = Light Duty Gas Truck (c)HDGV = Heavy Duty Gas Vehicle (d)Diesels = Encompasses all diesel vehicles (e)Values may not equal total due to rounding (f)Includes all sources (i.e., transportation, industrial processes, fuel combustion, and miscellaneous)
Source: EPA 1999b * Source: EPA 2002b

Table C-6 presents the estimated total pollutant emissions by light trucks due to gasoline.

Air Quality Analysis of Revised CAFE Standards

The remaining tables refer to the air quality impact analysis completed for Chapter 4 of this Draft EA. Except where noted, all values and tables in this section were taken or derived from the analysis developed.

Tables C-7 to C-11 present a yearly breakdown of estimated emissions - for criteria pollutants and carbon dioxide - generated at the Baseline 20.7 mpg level for MY 2005-2007.

Tables C-12 to C-16 present a yearly breakdown of estimated emissions - for criteria pollutants and carbon dioxide - generated under the Proposed Action.

Tables C-17 to C-21 present a yearly breakdown of estimated change in criteria pollutant and carbon dioxide emissions, when comparing the Baseline and the Proposed Action.

Table C-6. Emissions for Light Trucks (Gasoline)

Pollutant (Thousand short tons)	1970	1975	1980	1985	1987	1988	1989	1990	1991	1992	1993	1994	1995	1996	1997	1998	1999	2000
CO	16,570	15,767	16,137	18,960	17,274	17,133	15,940	13,816	15,014	14,567	15,196	17,350	14,829	19,271	18,943	18,726	NA	NA
NOx	1,278	1,461	1,408	1,530	NA	1,419	1,386	1,256	1,339	1,356	1,420	1,657	1,520	1,950	1,955	1,917	NA	NA
VOC	2,770	2,289	2,059	2,425	NA	2,129	1,867	1,622	1,688	1,588	1,647	1,909	1,629	2,060	2,017	2,015	NA	NA
SO2	40	48	50	55	NA	58	58	57	59	59	60	70	71	95	97	99	NA	NA
PM10	70	72	55	43	NA	37	34	30	32	31	31	35	32	41	41	40	NA	NA
Pb (short tons)	22,683	19,440	11,671	4,061	NA	605	232	100	4	4	5	5	5	7	7	7	NA	NA
CO2* (Tg CO2 eq.)	NA	NA	NA	NA	NA	NA	NA	283.1	282.2	282.1	294.2	318.4	325.3	333.5	337.3	356.4	366.5	369.4
Source: EPA 1998b
* Source: EPA 2002d

Table C-7. Baseline CO Emissions (thousand tons)

Table C-8. Baseline VOC Emissions (thousand tons)

Table C-9. Baseline NO_X Emissions (thousand tons)

Table C-10. Baseline PM 2.5 Emissions (thousand tons)

Table C-11. Baseline GHG Emissions (MMTCe)

Table C-12. Proposed Action CO Emissions (thousand tons)

Table C-13. Proposed Action VOC Emissions (thousand tons)

Table C-14. Proposed Action NO_X Emissions (thousand tons)

Table C-15. Proposed Action PM 2.5 Emissions (thousand tons)

Table C-16. Proposed Action GHG Emissions (MMTCe)

Table C-17. Proposed Action Net Change in CO Emissions (thousand tons)

Table C-18. Proposed Action Net Change in VOC Emissions (thousand tons)

Table C-19. Proposed Action Net Change in NO_X Emissions (thousand tons)

Table C-20. Proposed Action Net Change in PM 2.5 Emissions (thousand tons)

Table C-21. Proposed Action Net Change in GHG Emissions (MMTCe)

^[1] 42 U.S.C. § 4321 et seq.

^[2] 40 C.F.R. § 1500 et seq.

^[3] Based on EIA (2002b).

^[4] Based on estimates of the Annual Energy Outlook 2002 Report, Energy Information Administration, EIA 2002b.

^[5] All Vehicles includes all passengers cars and trucks

^[6] These values are derived from statistical estimates of the elasticity of miles driven per vehicle with respect to fuel cost per mile that range from approximately -0.10 to -0.20; see for example Greene, David L., "Vehicle Use and Fuel Economy: How Big is the Rebound Effect?" The Energy Journal, 13:1 (1992), 117-143; Greene, David L., James R. Kahn, and Robert C. Gibson, "Fuel Economy Rebound Effect for Household Vehicles," The Energy Journal, 20:3 (1999), 1-31; Jones, Clifton T., "Another Look at U.S. Passenger Vehicle Use and the ‘Rebound’ Effect from Improved Fuel Efficiency, The Energy Journal, 14:4 (1993), 99-110; and Goldberg, Pinelopi Koujianou Goldberg, "The Effects of the Corporate Average Fuel Efficiency Standards in the U.S.," The Journal of Industrial Economics, 46:1 (1998), 1-33. This study employs the midpoint of that range to estimate the rebound effect from tightening CAFE standards for light-duty trucks.

 [JGM1]Complete reference needed.

 [JGM2]Complete reference needed.