1. 1 EPA’s Climate Change Strategy Robert J. Meyers Principal Deputy Assistant Administrator U.S. EPA, Office of Air and Radiation December 3, 2007

2. 2 Slow the growth of GHG emissions –Reduce emissions intensity (tons/$GDP) by 18% between 2002 and 2012 –Strengthen domestic and international programs: ENERGY STAR, Climate Leaders, non-CO 2 Programs GHG Rulemaking – In response to Mass. v. EPA Invest in technology –Focus on long term R&D Invest in science –Research and assessment to reduce scientific uncertainties and better understand climate change impacts Enhance international cooperation U.S. Climate Change Strategy

3. 3 EPA Energy and Climate Programs In 2006 alone, EPA climate partnerships prevented 70 million metric tons of carbon-equivalent GHG emissions, contributing to the 100 million tons in total EPA-led reductions that year.

4. 4 History of GHG Rule January 23, 2007 - President calls for a commitment to reduce petroleum-based gasoline consumption by 20% by 2017 through renewable and alternative fuels  15% reduction in 2017 translates into a target of ~35B gallons of renewable and alternative fuel use in transportation system.  5% through vehicle efficiency improvements; equivalent of ~4% per year April 2, 2007 - Supreme Court rules that EPA must take action under Clean Air Act regarding greenhouse gas emissions from motor vehicles  CO2 is a pollutant  EPA must use different criteria to base decision on whether or not to regulate (Endangerment finding) April 9, 2007 National Renewable Fuels Standard – Final Rule Announced May 14, 2007 - President signs Executive Order requiring coordination among federal agencies tasked with development of any regulations affecting greenhouse gas emissions from motor vehicles

5. 5 Process and Timeline for GHG Rule Everything Remains Under Consideration – No Final Decisions Currently, within this process, we are looking at three major areas of work: –Endangerment finding –Vehicle regulations –Fuel regulations General Process/Consideration –Substantial dialogue & coordination Departments of Energy, Agriculture, Transportation and more –Address both vehicle and fuels – “Systems Approach” –When setting standards consider technology, cost, and lead time safety, energy, benefits/impacts flexible implementation mechanisms Schedule –Notice of Proposed Rulemaking by end of 2007 –Final Rule by end of 2008

6. 6 Endangerment Findings Endangerment finding is prerequisite to standard setting Under Section 202 of the Clean Air Act: –The Administrator shall by regulation prescribe standards applicable to the emission of any air pollutant(s) from motor vehicles, “which in his judgment cause, or contribute to, air pollution which may reasonably be anticipated to endanger public health or welfare.”

7. 7 CAA Authority for Vehicles Primary authority to regulate motor vehicle emissions falls under Section 202(a)(1): –“The Administrator shall by regulation prescribe …standards applicable to the emission of any air pollutant from any class or classes of new motor vehicles or motor vehicle engines which in his judgment cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare.” First EPA rule to regulate GHG emissions from cars and trucks EPA and NHTSA technical teams jointly evaluating potential vehicle technologies to reduce GHGs and improve fuel economy –Carefully assessing feasibility, lead time and costs

8. 8 CAA Authority for Fuels For All Fuels: –211(c) allows EPA to set controls on fuels as a means for reducing emissions of an air pollutant that endangers public health or welfare Renewable Fuels Only: –CAA 211(o) added by EPAct (2005) would allow us to require greater volumes of renewable fuels, but by itself is limited in scope Alternative fuels cannot be included Higher volumes could not be specified prior to 2013 Several restrictions (e.g., 48 state, gasoline only)

9. 9 Key Fuels Analyses Basis/form of standard Trading & implementation mechanisms Lifecycle GHG and energy analysis Emissions inventories for criteria pollutants & GHGs Air quality analysis Benefits analysis Economic impacts Feasibility & costs Energy impacts, energy security Agricultural impacts Impacts on water quality, soil, pesticides, etc

10. 10 For Demonstration Purposes Only Most values derived from RFS rule. Does not account for all inputs in LC Modeling Differentiating Between Fuels on a GHG Basis

11. 11 U.S. EPA Climate Change Web Site: http://www.epa.gov/climatechange