Tier 3 Would Bring Changes to Gasoline and Vehicles

by Ed Burke, Dennis K. Burke Inc.

In February, the EPA is expected to release its final rule on the Tier 3 standard that is designed to reduce air pollution from passenger cars and trucks.
Starting in 2017, Tier 3 would lower the sulfur content in gasoline, and set new vehicle emissions standards, looking at both the vehicle and its fuel as an integrated system. The new standards would reduce both tailpipe and evaporative emissions from passenger cars, light-duty trucks, medium-duty passenger vehicles, and some heavy-duty vehicles.
EPA had said it was on track to finalize the proposed sulfur emissions standard by the end of the year, but after receiving over 200,000 comments on the proposal, the timeline for a final rule was revised to February 2014.

The Tier 3 Standards
According to the EPA, Tier 3 is among the most highly cost-effective air quality control measures available. They project the program to cost about a penny per gallon of gasoline, and about $130 per vehicle. The annual cost of the overall program in 2030 would be around $3.4 billion, but would yield annual monetized health benefits between $8 and $23 billion.

Tier 3, as proposed, would require refiners to reduce sulfur in gasoline from 30 parts per million to 10 parts per million by 2017. The lower gasoline sulfur standard would make emission control systems more effective, and would enable more stringent vehicle emissions standards.
The earlier Tier 2 standards lowered the sulfur content in gasoline by 90 percent, from 300 parts per million to the current 30 parts per million.
The Tier 3 standards were designed to be implemented over the same timeframe as EPA’s program for reducing greenhouse gas (GHG) emissions from light-duty vehicles starting in model year 2017.
The new tailpipe standards would include different phase-in schedules that vary by vehicle class, but generally phase in between model years 2017 and 2025. They also include credits for early compliance, and the ability to offset some higher-emitting vehicles with extra-clean models.
The proposed standards include an averaging, banking, and trading (ABT) program that would allow refiners and importers to spread out their investment through an early credit program and rely on ongoing nationwide averaging to meet the sulfur standard.

Removing Sulfur
The sulfur in gasoline does not actually pose a health problem. Removing the sulfur allows your vehicle’s catalytic converter to work more efficiently, reducing tailpipe emissions. These emissions, nitrogen oxides (NOX), volatile organic compounds (VOC), carbon monoxide (CO), and direct particulate matter (PM2.5), contribute to smog and air toxics, which can cause respiratory and heart disease.
Compared to current standards, the proposed non-methane organic gases (NMOG) and nitrogen oxides (NOX), presented as NMOG+NOX, tailpipe standards for light-duty vehicles represent approximately an 80 percent reduction from today’s fleet average and a 70 percent reduction in per-vehicle particulate matter (PM) standards. Proposed heavy-duty tailpipe standards represent about a 60 percent reduction.
EPA notes that the proposed Tier 3 gasoline sulfur standards are similar to levels already being achieved in California. But according to a study released by the American Petroleum Institute (API) in April, EPA’s proposed Tier 3 rule would result in an ozone reduction of less than one percent, relative to the reductions from EPA’s earlier Tier 2 rule.
Looking at infrastructure, EPA reports that 66 U.S. refineries would need modifications to existing hydrotreating equipment to meet the Tier 3 gasoline sulfur standards, while 16 refineries would need a major overhaul.
There are industry concerns that the U.S. does not have enough excess refinery capacity to replace supply while modifications and overhauls are being done over the next three years, leading to possible shortages and higher prices. Refiners believe EPA’s Tier 3 proposal could increase the cost of gasoline production by up to nine cents per gallon.

New E15 Vehicles
The Tier 3 standards would change the “vehicle certification fuel” to E15 (gasoline that is 15 ethanol). By changing the vehicle’s certification fuel, new cars would be certified to run on E15, which is sort of a backdoor way of mandating that car engines be designed to run on the fuel.
EPA has approved E15 for cars of recent years, but automakers disagree and are concerned that the cars might have E15-related problems that they would be liable for.
What about our older vehicles? Not everybody plans on buying a new car in the next three years. Will E15 cause even more problems for small engines such as boat engines, lawn mowers, etc.?
The new standards would limit greenhouse gas (GHG) emissions from light and medium duty passenger vehicles to 30 milligrams per mile by 2025, from the current 160 milligrams per mile requirement. It would also limit volatile organic compound and nitrogen oxide emissions from heavy-duty pickup trucks and vans to 178-247 milligrams per mile, depending on the type of vehicle. In addition, the proposed rule would limit evaporative emission limits for both passenger and heavy-duty vehicles.
EPA is also proposing to extend the vehicle’s compliance period during which the standards apply from 120,000 miles to 150,000 miles.
Although any changes to the proposal are unlikely, we’ll have to wait for the final rule in February to see.

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