On June 19, 2015, the Environmental Protection Agency (EPA) and the Department of Transportation’s (DOT) National Highway Traffic Safety Administration (NHTSA) proposed a program establishing Phase 2 of greenhouse gas (GHG) emissions and fuel efficiency standards for medium- and heavy-duty vehicles. The proposal would enhance standards for vehicles currently regulated under Phase 1 and aims to improve fuel economy and emissions reduction by an additional 24 percent by 2027. The proposed standards would cover Model Year (MY) 2021-2027 vehicles and would establish the first GHG and fuel efficiency standards for certain trailers used with heavy-duty combination tractors. Mandates for trailers would start in 2018 for EPA standards and in 2021 for NHTSA standards.

The Phase 2 proposal would strengthen the standards for future model years and aims to reduce emissions by an additional 24 percent by 2027. It also builds on standards for light-duty vehicles. The transportation sector accounts for 27 percent of U.S. emissions, second only to the electricity generation sector. The Phase 2 program is expected to result in approximately $230B in net benefits in the form of fuel savings, emissions reductions, health benefits, energy security benefits, travel benefits, and refueling benefits over the lifetime of vehicles sold. Industry would incur approximately $25B in costs over the same period.

The proposal would require significant investments in new materials and advanced engine and trucking technology to reduce weight and enhance vehicle efficiency. While the proposal will drive new technology to reduce costs for truckers, some freight companies claim that the proposed regulation would create significant uncertainty, require large costs, discourage vehicle sales and involve untested technologies. The June 19 proposal opened a 60-day comment period including two public hearings over the course of the period.

Originally published by EnerKnol.

EnerKnol provides U.S. energy policy research and data services to support investment decisions across all sectors of the energy industry. Headquartered in New York City, EnerKnol is proud to be a NYC ACRE company. 

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