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GHG/CAFE Standard Impacts on Vehicles and Technologies John German, ICCT Univ. of Michigan Transportation Research Institute: Automotive Product Portfolios.

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Presentation on theme: "GHG/CAFE Standard Impacts on Vehicles and Technologies John German, ICCT Univ. of Michigan Transportation Research Institute: Automotive Product Portfolios."— Presentation transcript:

1 GHG/CAFE Standard Impacts on Vehicles and Technologies John German, ICCT Univ. of Michigan Transportation Research Institute: Automotive Product Portfolios in the Age of CAFÉ February 13, 2013

2 The standard provisions Technology progress Customers Vehicle Impacts

3 The standard provisions Technology progress Customers Vehicle Impacts

4 Slide 4 Comparison of passenger vehicle GHG standards

5 Slide 5 Comparison of passenger vehicle GHG standards

6 Characteristics of Worldwide Standards 6 Country/ Region Regulated metricAttributeForm Categories, classes, other provisions Fuel Econom y Fuel Consumption CO 2 /GHGWeightFootprintClassContinuousBins European Union # XXX Eco-innovations, super-credits United States XXXXX 2WD, AC credit, FFV/E85, alternative fuels Japan XXX Averaging within bins China XXXX Transmission, per- vehicle limits corporate average Canada XXXX AC credits, alternative fuels South Korea* XXXX Eco-innovations Mexico XXXX India XXX #: CO 2 standards complemented by Air-conditioning, tyre pressure monitoring, gear-shift indicators etc. * : FE/CO 2 standards include consideration for tyre pressure monitoring, gear-shift indicators

7 2017 and 2025 US Car and Light-Truck Standards 7 1 Sq. meter = 10.764 Sq. feet

8 ICCT (2010) Size or Mass? - The Technical Rationale for Selecting Size as an Attribute for Vehicle Efficiency Standards A size-based standard fully captures benefits of lightweighting Slide 8 Mass-based design: –Efficiency: 11-14 g CO 2 /km benefit –Lightweighting: only 2-3 g CO 2 /km compliance benefit Size-based design: –Efficiency: 11-14 g CO 2 /km benefit –Lightweighting: 7-8 g CO 2 /km actual benefit

9 Air Conditioning Credits CO 2 credits given based upon the GWP of the air conditioning refrigerant –Continuous incentive for better refrigerants without mandates or artificial deadlines –Allows manufacturers to consider both GWP and A/C system efficiency when choosing refrigerant CAFE and CO 2 credits for improved air conditioning efficiency Slide 9

10 Off-Cycle Credits Source: Greenpeace US rule summary, September 6, 2012 Starts 2014 for CO2, 2017 for FE OEMs can apply for higher credits than listed and can apply for other off- cycle credits Total off- cycle credits capped at 10 g/mi

11 EV, FCV, CNG Credits (CO 2 only) 0 g/miCO 2 rating for EVs, PHEVs, FCVs –Per-company sales cap of 200,000 to 600,000 applies to MYs 2022-2025 Multiple vehicle credits: Credits will be given for vehicles mandated by ZEV ICCT supports EV credits, but they should not be used to weaken the benefits of the standards Slide 11

12 Pickup Truck Technology Credits Pickup trucks performing 15% better than their applicable CO2 target receive a 10 g/mi credit (0.0011 gal/mi) –Expires after 2021 Those performing 20% better than their target receive a 20 g/mi credit (0.0023 gal/mi) –Credits continue for 5 years even if FE does not improve after year qualified These are artificial credits that reduce the benefits of the standards –Especially a concern due to the lower improvements required from light trucks Slide 12

13 2025 Test Cycle Tailpipe Requirements Does NOT include reclassifying cars as light trucks or making light trucks larger Credits (maximum): A/C refrigerant: 13.8 gCO2/mi for cars;16.4 for LDT (No use of AC credits = 54.5 mpg) A/C efficiency: 5 g/mi (.000563 gal/mi) for cars; 8 g/mi (.000810 gal/mi) for LDT Off-cycle: 10 g/mi (.001125) for cars and LDT Pickup: 20 g/mi (.002250) for pickup trucks only EV: Zero upstream + multiple credits (assumed 5% market share for cars and 1% for LDT)

14 The standard provisions Technology progress Customers Vehicle Impacts

15 Percents are approximate, based on energy losses for vehicles on the combined U.S. city and highway drive cycles. Sources: Kromer and Heywood, 2007 and U.S. EPA, 2010 Where Does the Energy Go? Slide 15 2008-10 vehicles are generally 15-20% efficient

16 The Real Technology Breakthrough Computers Computer design, computer simulations, and on-vehicle computer controls are revolutionizing vehicles and powertrains Especially important for lightweight materials Optimize hundreds of parts – size and material Capture secondary weight – and cost – reductions The high losses in the internal combustion engine are an opportunity for improvement Also reducing size and cost of hybrid system

17 Improved Cost Analyses - Teardown 17 FEV – Phase 2 Transmission Analysis

18 18 Technology Costs Dropping Technology availability increases - and its costs decrease - over time Incremental vehicle costs and percent improvements versus MY2008 baseline Data from EPA/NHTSA 2012-2016 rulemaking and EPA/NHTSA/CARB TAR for 2020

19 19 Cost is direct manufacturing cost NRC Report is Effectiveness and lmpact of Corporate Average Fuel Economy (CAFE) Standards, 2002 Draft RIA is for NHTSA/EPA proposed standards for 2017-25 light-duty vehicles Pace of Technology Innovation is Accelerating

20 201020122010 Ford FocusFord Focus EcoBoost C-class diesel avg. 1.6L, 4 cyl., 74 kW 1.0L, 3 cyl., 74 kW 1.7L ---SS+DI+turbo 1,175 kg1,195 kg M5, 11.9 sM5, 12.5 s 14.6 km/l21.4 km/l17.4 km/l 20102012 Audi A3 1.6L, 4 cyl., 75 kW1.2L, 4 cyl., 77 kW ---SS+DI+turbo+7DCT 1,185 kg1,150 kg M5, 11.8 s7DCT, 10.4 s 14.4 km/l20.1 km/l GDITurbo6-speed Auto 20094.2%3.6%25% 20108.3%3.5%38% 201113.7%7.4%52% 201215% 201319% Source: 2009-2011: 2011 EPA Fuel Economy Trends Report Source: 2012-2013: Automotive News, January 14, 2013 New powertrains introduced in Europe +47% +40% Pace of Technology Introduction is Accelerating

21 Honda Prototype Engine Base ( Electro-magnetic valve ) HCCI Engine 30% Improvement in fuel economy: Fiat MultiAir Digital Valve Actuation Heat release rate Crank angle [ATDC deg] dQ/dθ[J/deg] -400-204020 0 10 20 HCCI SI Requires increasing the self-ignition region Next-generation Gasoline Engines Dual-loop high/low pressure cooled exhaust gas recirculation

22 Turbo-Boosted EGR Engines Terry Alger, Southwest Research Institute, Clean and Cool, Technology Today, Summer 2010 Highly dilute combustion – considerable efficiency improvement Advanced ignition systems required

23 Turbo Dedicated EGR Engines Terry Alger and Barrett Mangold, SwRI, Dedicated EGR, SAE 2009-01-0694 Highly dilute, low temperature combustion Advanced ignition systems required PSA 2017 introduction

24 Input Powersplit: Planetary Gearing Toyota and Ford: Optimizes city efficiency, inexpensive CVT Achilles' Heel: Fixed torque split between engine and generator 24 Source: Hybrid Synergy Drive, Toyota Hybrid System II, Toyota Motor Corp., May 2003 Two large motors –generator must handle part of engine output –Motor must handle generator plus battery output Cruising efficiency loss –Part of engine output always incurs losses in generator and motor Power recirculation possible

25 Advanced P2 hybrid system – not yet in production –Small, single motor integrated into automated manual transmission Major reductions in cost of hybrid system Must be high volume to cover high capitol costs of transmission redesign –Reduction in transmission clutch cost, possible use of single-clutch manual transmission New, higher-power Li-ion batteries – smaller, lighter, and lower cost 25 Nissan Fuga/M35 parallel hybrid layout Future Low-Cost Hybrid Getrag prototype

26 Slide 26 Lightweight materials offer great potential Material composition of lightweight vehicle body designs: Approximate fuel economy improvement 10% 25% 27% 37% Also incremental improvements in aerodynamics and tire rolling resistance

27 Vehicle Mass-Reduction Cost ($/lb) US agencies collaborated to assess available studies and model costs associated with vehicle mass-reduction –Agencies assessed and weighted the available mass-reduction studies for redesign of vehicle models in the 2017-2025 timeframe –Regulation analyses apply cost-per-pound-reduced vs percent vehicle mass reduction –Ultimately, agencies projected average vehicle mass would decrease by 8-11% by 2025 27

28 Major New Mass-Reduction Work Lotus Engineering (CARB) –Continuation of 2010 study (-20%, -33% mass Toyota Venza) –Includes crashworthiness safety (NHTSA FMVSS) validation –Demonstrates cost-effective 30% mass reduction at < $0/vehicle EDAG / Electricore (NHTSA) –Technical assessment of -22% mass Honda Accord at $319/vehicle –Includes crashworthiness safety (NHTSA FMVSS) validation EDAG WorldAutoSteel Future Steel Vehicle –12-18% mass reduction, no additional cost, with only using steels FEV (US EPA) –Technical assessment of -18% mass Toyota Venza at no cost –Includes crashworthiness safety (NHTSA FMVSS) validation 28

29 Vehicle Mass-Reduction Cost FSV and FEV studies indicate 12-18% weight reductions at zero cost EDAG and Lotus studies indicate larger mass reductions at costs on the CARB cost trend line 29 Lotus 2012 EDAG 2012 FEV 2012 FSV 2012 CONFIDENTIAL, PRELIMINARY

30 The standard provisions Technology progress Customers Vehicle Impacts

31 Turrentine & Kurani, 2004 Out of 60 households (125 vehicle transactions) 9 stated that they compared the fuel economy of vehicles in making their choice. 4 households knew their annual fuel costs. None had made any kind of quantitative assessment of the value of fuel savings. In-depth interviews of 60 California households vehicle acquisition histories found no evidence of economically rational decision-making about fuel economy.

32 Uncertainty about future fuel savings makes paying for more technology a risky bet - What MPG will I get (your mileage may vary)? - How long will my car last? - How much driving will I do? - What will gasoline cost? - What will I give up or pay to get better MPG? Consumers are, in general, LOSS AVERSE Causes the market to produce less fuel economy than is economically efficient 2002 Nobel Prize for Economics (Tversky & Kahnemann, J. Risk & Uncertainty 1992 A bird in the hand is worth two in the bush.

33 Innovator Early Adopter Early Majority Hanger- On New Customer Profile Increasingly risk averse

34 The standard provisions Technology progress Customers Vehicle Impacts

35 2017 and 2025 US Car and Light-Truck Standards 35 1 Sq. meter = 10.764 Sq. feet

36 Footprint Standards do not Impact Size Slide 36

37 37 1 Sq. meter = 10.764 Sq. feet 2016 US Car and Light-Truck Standard Increase

38 38 1 Sq. meter = 10.764 Sq. feet 2016 and 2021 US Car and Light-Truck Standards

39 Real Gasoline Price Motor Gasoline Retail Prices, U.S. City Average, adjusted using CPI-U AEO2013 early release

40 New Vehicle Fuel Economy 2012 – 2025 NHTSA CAFE standards 2026 – 2035 +4% per year From 2011 EPA FE Trends Report

41 New Vehicle Gasoline Cost per Mile $3.71/ gal

42 Real Fuel Cost - % of Disposable Income $3.94/gal $7.50/gal $14/gal BEA, Table 2.1, Personal Income and It's Disposition Forecasted Per Capita Disposable Income from AEO2013 Early Release

43 Summary Standards needed due to consumer loss aversion Improvements in conventional powertrains and load reduction will be far greater than expected Only modest number of hybrids – and no xEVs – needed P2 hybrid cost will be accepted by the mass market ~2022 Standards will have no impact on vehicle sales Fuel savings will be larger than increased car payment Future vehicles may increase in size Footprint system provides no incentive to downsize Differential changes to the light truck footprint curve increase the incentive to reclassify cars as trucks and to make light trucks larger Fuel share of disposable income will decrease

44 Thank You

45 The mission of ICCT is to dramatically improve the environmental performance and efficiency of cars, trucks, buses and transportation systems in order to protect and improve public health, the environment, and quality of life.

46 Advantages (+) & disadvantages (–) of different standard forms 46 Attribute Flat Category /Class FootprintWeight The potential for compliance benefits from given strategies Powertrain efficiency ++++ Engine downsizing ++++ Mass reduction (per-vehicle light-weighting) +++ Downsizing sales-shift + Potential disadvantages in loss of intended benefits Backsliding due to Category sales shift – Backsliding due to vehicle sales shift ––– Backsliding due to vehicle weight creep – Potential for equitable technology-based obligated reductions across automakers with different vehicle types and classes ––++ Simplicity, transparency of standards; outcome certainty +–––

47 Off-Cycle Credits Off-cycle credits are a great concept –Can increase the total fuel and CO2 savings and reduce the cost to comply But to be effective, credits must: –Properly reflect actual in-use reductions –Be verifiable –Avoid duplicating on-cycle benefits Credits that are artificial and do not produce comparable in-use reductions severely undermine the effectiveness and credibility of the standards. Slide 47

48 Background: 2016 US Car and Truck Standards Separate CO 2 -indexed car and truck standards (with separate slopes) –By statute (EPCA 1975, EISA 2007), NHTSA must set separate attribute-based car, truck standards –Assuming no shifts in fleet composition and no trading -24% gCO 2 e/mile from 2008-2016 Cars and trucks would reduce gCO 2 e/mile by 23% and 26%, respectively, from 2008 to 2016. Excluding 10.6 gCO 2 /mile from AC credits, CO 2 reductions are 19% (cars) and 21% (truck) 48 The equivalent lines for CAFE standards are slightly sloped (i.e., not perfectly linear) in fuel economy (mpg) space; note that EPA assumes some sales shift toward smaller car/trucks in 2016 timeframe in their analysis; in MY2012, 2WD SUVs shift from light truck to car category; the right y-axis is rated fuel economy after 10.6 g/mile A/C credits are utilized Average 2008 car Average 2008 truck

49 49 1 Sq. meter = 10.764 Sq. feet 2017 and 2025 US Car and Light-Truck Standards

50 Synergies with other technologies and optimized control strategies –Engine (Atkinson, Miller, lean-cruise, digital valve); optimization of engine and transmission operation; mass-reduction; automated manual transmission New P2 hybrid – single motor with two clutches –Pre-transmission clutch: engine decoupling and larger motor –Nissan, VW, Hyundai, BMW, and Mercedes –Offer much larger potential for future integration and cost reduction High-power Li-ion batteries – smaller, lighter, and lower cost 50 VW Touareg hybrid module Nissan Fuga/M35 parallel hybrid layout Hybrid Technology Advances

51 New Consumer Discounting is Fixable 0 Fuel Consumption Rebate Fee Increase fuel taxes Increase fuel taxes Feebates: Pay manufacturers and consumers up front for value of the fuel savings Feebates: Pay manufacturers and consumers up front for value of the fuel savings

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