[Federal Register Volume 85, Number 169 (Monday, August 31, 2020)]
[Proposed Rules]
[Pages 53722-53725]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-17214]


-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 600

[EPA-HQ-OAR-2020-0314; FRL-10012-24-OAR]
RIN 2060-AU89


Technical Correction to the Flex-Fuel Vehicle Provisions in CAFE 
Regulations

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: EPA is proposing to correct an error in EPA's regulations for 
test procedures used in the Corporate Average Fuel Economy (CAFE) 
program finalized in a 2012 rulemaking. EPA established the procedures 
under the general provisions of Energy Policy and Conservation Act 
(EPCA) which authorize EPA to establish test and calculation procedures 
for CAFE. The correction clarifies the method for how flex-fuel 
vehicles are accounted for in manufacturer fuel economy calculations in 
model years 2020 and later. This correction allows the program to be 
implemented as originally intended in the 2012 rule. This proposed 
action is not expected to result in any significant changes in 
regulatory burdens or costs. In the ``Rules and Regulations'' section 
of this Federal Register, we are taking direct final action without a 
prior proposed rule. If we receive no adverse comment, we will not take 
further action on this proposed rule.

DATES: Comments: Written comments must be received by October 15, 2020. 
If EPA receives a request for a public hearing by September 8, 2020, we 
will publish information related to the hearing and new deadline for 
public comment in a subsequent Federal Register document.
    Public hearing: EPA will not hold a public hearing on this matter 
unless a request is received by the person identified in the FOR 
FURTHER INFORMATION CONTACT section of this preamble by September 8, 
2020. If EPA receives such a request, we will hold a public hearing. 
Additional information about the hearing would be published in a 
subsequent Federal Register document.

ADDRESSES: You may send comments, identified by Docket ID No. EPA-HQ-
OAR-2020-0314, by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov/ 
(our preferred method). Follow the online instructions for submitting 
comments.
     Email: a-and-r-Docket@epa.gov. Include Docket ID No. EPA-
HQ-OAR-2020-0314 in the subject line of the message.
     Fax: (202) 566-9744 Include Docket ID No. EPA-HQ-OAR-2020-
0314 on the cover of the fax.
     Mail: U.S. Environmental Protection Agency, EPA Docket 
Center, OAR, Docket EPA-HQ-OAR-2020-0314, Mail Code 28221T, 1200 
Pennsylvania Avenue NW, Washington, DC 20460.
     Hand Delivery/Courier: EPA Docket Center, WJC West 
Building, Room 3334, 1301 Constitution Avenue NW, Washington, DC 20004. 
The Docket Center's hours of operations are 8:30 a.m.-4:30 p.m., 
Monday-Friday (except Federal Holidays).
    Instructions: All submissions received must include the Docket ID 
No. for this rulemaking. Comments received may be posted without change 
to https://www.regulations.gov/, including any personal information 
provided. For detailed instructions on sending comments and additional 
information on the rulemaking process, see the ``Public Participation'' 
heading of the SUPPLEMENTARY INFORMATION section of this document. Out 
of an abundance of caution for members of the public and our staff, the 
EPA Docket Center and Reading Room are closed to the public, with 
limited exceptions, to reduce the risk of transmitting COVID-19. Our 
Docket Center staff will continue to provide remote customer service 
via email, phone, and webform. We encourage the public to submit 
comments via https://www.regulations.gov/ or email, as there may be a 
delay in processing mail and faxes. Hand deliveries and couriers may be 
received by scheduled appointment only. For further information on EPA 
Docket Center services and the current status, please visit us online 
at https://www.epa.gov/dockets.

FOR FURTHER INFORMATION CONTACT: Christopher Lieske, Office of 
Transportation and Air Quality (OTAQ), Assessment and Standards 
Division (ASD), Environmental Protection Agency, 2000 Traverwood Drive, 
Ann Arbor, MI 48105; telephone number: (734) 214-4584; email address: 
lieske.christopher@epa.gov fax number: (734) 214-4816.

SUPPLEMENTARY INFORMATION:

I. Why is EPA issuing this proposed rule?

    This document proposes to correct an error in EPA's regulations for 
test procedures used in the Corporate Average Fuel Economy (CAFE) 
program finalized in a 2012 rulemaking. The correction clarifies the 
method for how flex-fuel vehicles are accounted for in manufacturer 
fuel economy calculations in model years 2020 and later. This 
correction allows the program to be implemented as originally intended 
in the 2012 rule.
    We have published a direct final rule in the ``Rules and 
Regulations'' section of this Federal Register because we view this as 
a noncontroversial action and anticipate no adverse comment. We have 
explained our reasons for this action in the preamble to the direct 
final rule; that document also includes draft regulations detailing all 
the amendments under consideration.
    If we receive no adverse comment, we will not take further action 
on this proposed rule. If we receive adverse comment, we will publish a 
timely withdrawal in the Federal Register informing the public that the 
direct final rule, or the relevant provisions of the rule, will not 
take effect. We would address all public comments in any subsequent 
final rule based on this proposed rule.
    We do not intend to institute a second comment period on this 
action. Any parties interested in commenting must do so at this time. 
For further information, please see the information provided in the 
ADDRESSES section of this document.

II. Does this action apply to me?

    This action affects companies that manufacture or sell passenger 
automobiles (passenger cars) and non-passenger automobiles (light 
trucks) as defined under NHTSA's CAFE regulations.\1\ Regulated 
categories and entities include:
---------------------------------------------------------------------------

    \1\ ``Passenger car'' and ``light truck'' are defined in 49 CFR 
part 523.

[[Page 53723]]



------------------------------------------------------------------------
                                        NAICS
              Category                 codes A   Examples of potentially
                                                    regulated entities
------------------------------------------------------------------------
Industry............................     336111  Motor Vehicle
                                         336112   Manufacturers.
Industry............................     811111  Commercial Importers of
                                         811112   Vehicles and Vehicle
                                         811198   Components.
                                         423110
Industry............................     335312  Alternative Fuel
                                         811198   Vehicle Converters.
------------------------------------------------------------------------
A North American Industry Classification System (NAICS).

    This list is not intended to be exhaustive, but rather provides a 
guide regarding entities likely to be regulated by this action. To 
determine whether particular activities may be regulated by this 
action, you should carefully examine the regulations. You may direct 
questions regarding the applicability of this action to the person 
listed in FOR FURTHER INFORMATION CONTACT.

III. Public Participation

    EPA will keep the record open until October 15, 2020. All 
information will be available for inspection at the EPA Air Docket No. 
EPA-HQ-OAR-2020-0314. Submit your comments, identified by Docket ID No. 
EPA-HQ-OAR-2020-0314, at https://www.regulations.gov (our preferred 
method), or the other methods identified in the ADDRESSES section. Once 
submitted, comments cannot be edited or removed from the docket. The 
EPA may publish any comment received to its public docket. Do not 
submit to EPA's docket at https://www.regulations.gov any information 
you consider to be Confidential Business Information (CBI) or other 
information whose disclosure is restricted by statute. Multimedia 
submissions (audio, video, etc.) must be accompanied by a written 
comment. The written comment is considered the official comment and 
should include discussion of all points you wish to make. The EPA will 
generally not consider comments or comment contents located outside of 
the primary submission (i.e., on the web, cloud, or other file sharing 
system). For additional submission methods, the full EPA public comment 
policy, information about CBI or multimedia submissions, and general 
guidance on making effective comments, please visit https://www.epa.gov/dockets/commenting-epa-dockets.
    The EPA is temporarily suspending its Docket Center and Reading 
Room for public visitors, with limited exceptions, to reduce the risk 
of transmitting COVID-19. Our Docket Center staff will continue to 
provide remote customer service via email, phone, and webform. We 
encourage the public to submit comments via https://www.regulations.gov/ as there may be a delay in processing mail and 
faxes. Hand deliveries or couriers will be received by scheduled 
appointment only. For further information and updates on EPA Docket 
Center services, please visit us online at https://www.epa.gov/dockets.
    The EPA continues to carefully and continuously monitor information 
from the Centers for Disease Control and Prevention (CDC), local area 
health departments, and our Federal partners so that we can respond 
rapidly as conditions change regarding COVID-19.

IV. Proposed Provisions

    This proposal would correct a technical error in EPA regulations 
pertaining to the treatment of model year (MY) 2020 and later E85 flex-
fuel vehicles (FFVs) in the Corporate Average Fuel Economy (CAFE) 
program. These provisions were established in the 2012 final rule 
``2017 and Later Model Year Light-Duty Vehicle Greenhouse Gas Emissions 
and Corporate Average Fuel Economy Standards,'' where EPA adopted new 
test procedures for weighting the measured fuel economy of MY 2020 and 
later FFVs when the vehicles are tested on both E85 and gasoline test 
fuels.\2\ EPA established the procedures under the general provisions 
of Energy Policy and Conservation Act (EPCA) which authorize EPA to 
establish test and calculation procedures for CAFE.\3\
---------------------------------------------------------------------------

    \2\ See 77 FR 62830 and 63127, October 15, 2012.
    \3\ 49 U.S.C. 32904(a), (c).
---------------------------------------------------------------------------

    49 U.S.C. 32905 specifies how the fuel economy of dual fuel 
vehicles is to be calculated for the purposes of CAFE through the 2019 
model year. The basic calculation includes a 50/50 harmonic average 
weighting of the fuel economy for the alternative fuel and the 
conventional fuel, irrespective of the actual usage of each fuel. In a 
related provision, 49 U.S.C. 32906, the amount by which a 
manufacturer's CAFE value (for domestic passenger cars, import 
passenger cars, or light-duty trucks) can be improved by the statutory 
incentive for dual fuel vehicles is limited by EPCA to 1.2 mpg through 
2014, and then gradually reduced until it is phased out entirely 
starting in model year 2020.\4\
---------------------------------------------------------------------------

    \4\ 49 U.S.C. 32906.
---------------------------------------------------------------------------

    Recognizing the expiration of the special calculation procedures in 
49 U.S.C. 32905 for dual fuel vehicles, EPA established, in the 2012 
rule, calculation procedures for model years 2020 and later FFVs under 
the general provisions of EPCA noted above authorizing EPA to establish 
CAFE testing and calculation procedures. EPA regulations at 40 CFR 
600.510-12(c)(2)(v) specify weighting the fuel economy measured when an 
FFV is tested on E85 and gasoline test fuel using the same weighting 
factor as is used in the greenhouse gas program for weighting 
CO2 emissions measured on the two fuels.\5\ As part of the 
2012 rule, NHTSA modified its regulations at Part 536.10 to limit the 
applicability of the EPCA limits to MYs 2019 and earlier and to state 
that for MYs 2020 and beyond a manufacturer must calculate the fuel 
economy of dual-fuel vehicles in accordance with EPA's regulations at 
40 CFR 600.510-12(c)(2)(v).
---------------------------------------------------------------------------

    \5\ This weighting factor is commonly referred to as the ``F-
factor.'' The F-factor is a value specified by EPA in accordance 
with 40 CFR 600.510-12(k) based on EPA's assessment of the real-
world use of E85 over the life of the FFVs.
---------------------------------------------------------------------------

    The preamble for the 2012 rule summarized EPA's approach for MY 
2020 and later as follow: ``EPA is finalizing its proposal, under its 
EPCA authority, to use the ``utility factor'' methodology for PHEV and 
CNG vehicles described above to determine how to apportion the fuel 
economy when operating on gasoline or diesel fuel and the fuel economy 
when operating on the alternative fuel. For FFVs under the CAFE 
program, EPA is using the same methodology it uses for the GHG program 
to apportion the fuel economy, namely based on actual usage of E85. As 
proposed, EPA is continuing to use Petroleum Equivalency Factors and 
the 0.15 divisor used in the MY 2012-2016 rule for the alternative 
fuels,

[[Page 53724]]

however with no cap on the amount of fuel economy increase allowed.'' 
\6\
---------------------------------------------------------------------------

    \6\ 77 FR 62653.
---------------------------------------------------------------------------

    EPA noted in the 2012 preamble ``[i]n a related provision, 49 
U.S.C. 32906, the amount by which a manufacturer's CAFE value (for 
domestic passenger cars, import passenger cars, or light-duty trucks) 
can be improved by the statutory incentive for dual fuel vehicles is 
limited by EPCA to 1.2 mpg through 2014, and then gradually reduced 
until it is phased out entirely starting in model year 2020. With the 
expiration of the special calculation procedures in 49 U.S.C. 32905 for 
dual fueled vehicles, the CAFE calculation procedures for model years 
2020 and later vehicles need to be set under the general provisions 
authorizing EPA to establish testing and calculation procedures.'' \7\ 
The 2012 rule preamble also notes ``NHTSA interprets section 32906(a) 
as not limiting the impact of duel fueled vehicles on CAFE calculations 
after MY2019.'' \8\ The 2012 rule preamble states ``we interpret 
Congress' statement in section 32906(a)(7) that the maximum increase in 
fuel economy attributable to dual-fueled automobiles is `0 miles per 
gallon for model years after 2019' within the context of the 
introductory language of section 32906(a) and the language of section 
32906(b), which, again, refers clearly to the statutory credit, and not 
to dual-fueled automobiles generally. It would be an unreasonable 
result if the phaseout of the credit meant that manufacturers would be 
effectively penalized, in CAFE compliance, for building dual-fueled 
automobiles . . .'' \9\ EPA believes all of these statements from the 
2012 final rule make clear EPA's intent not to apply the 49 U.S.C. 
32906 credit limits to CAFE calculations for model year 2020 and later 
vehicles.
---------------------------------------------------------------------------

    \7\ 77 FR 62830.
    \8\ 77 FR 62830.
    \9\ 77 FR 63020.
---------------------------------------------------------------------------

    A discrepancy in EPA's regulations exists in section 40 CFR 
600.510-12(h), where prior to the 2012 rule, EPA codified the EPCA 
limits in EPA's regulations. These regulations specify that the impact 
of certain dual-fuel vehicles on a manufacturer's fleet CAFE 
calculations is limited to 0.0 for MY 2020 and later. EPA inadvertently 
did not revise the regulations at 40 CFR 600.510-12(h) to account for 
the 2012 rule's treatment of MY 2020 and later FFVs. The existing 40 
CFR 600.510-12(h) provisions may be read as applying the EPCA limits to 
MY 2020 and later FFVs, inconsistent with the clear intent of the 2012 
rule. This proposal would correct this error by making narrow revisions 
to this section of the regulations to clarify that the limits do not 
apply to MY 2020 and later FFVs, where the emissions of those vehicles 
are calculated in accordance with 40 CFR 600.510-12(c)(2)(v), 
consistent with the intent of the 2012 final rule.
    For additional discussion of the proposed rule changes, see the 
direct final rule EPA has published in the ``Rules and Regulations'' 
section of today's Federal Register. This proposal incorporates by 
reference all the reasoning, explanation, and regulatory text from the 
direct final rule.

V. Statutory and Executive Order Reviews

    Additional information about these statutes and Executive Orders 
can be found at http://www2.epa.gov/laws-regulations/laws-and-executive-orders.

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is not a significant regulatory action and was 
therefore not submitted to the Office of Management and Budget (OMB) 
for review.

B. Executive Order 13771: Reducing Regulations and Controlling 
Regulatory Costs

    This action is not expected to be an Executive Order 13771 
regulatory action because this action is not significant under 
Executive Order 12866.

C. Paperwork Reduction Act

    This action does not impose any new information collection burden 
under the PRA, since it merely clarifies and corrects existing 
regulatory language. OMB has previously approved the information 
collection activities contained in the existing regulations and has 
assigned OMB control number of 2060-0104.

D. Regulatory Flexibility Act (RFA)

    I certify that this action will not have a significant economic 
impact on a substantial number of small entities under the RFA. In 
making this determination, the impact of concern is any significant 
adverse economic impact on small entities. An agency may certify that a 
rule will not have a significant economic impact on a substantial 
number of small entities if the rule relieves regulatory burden, has no 
net burden or otherwise has a positive economic effect on the small 
entities subject to the rule. This rule merely clarifies and corrects 
existing regulatory language. We therefore anticipate no costs and 
therefore no regulatory burden associated with this rule.

E. Unfunded Mandates Reform Act (UMRA)

    This action does not contain any unfunded mandate as described in 
UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect 
small governments. The action imposes no enforceable duty on any state, 
local or tribal governments. Requirements for the private sector do not 
exceed $100 million in any one year.

F. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government.

G. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications as specified in 
Executive Order 13175. This rule only corrects and clarifies regulatory 
provisions that apply to light-duty vehicle manufacturers. Tribal 
governments would be affected only to the extent they purchase and use 
regulated vehicles. Thus, Executive Order 13175 does not apply to this 
action.

H. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    This action is not subject to Executive Order 13045 because it is 
not economically significant as defined in Executive Order 12866, and 
because the EPA does not believe the environmental health or safety 
risks addressed by this action present a disproportionate risk to 
children. This proposed rule merely corrects and clarifies previously 
established regulatory provisions.

I. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution or Use

    This action is not subject to Executive Order 13211, because it is 
not a significant regulatory action under Executive Order 12866.

J. National Technology Transfer and Advancement Act (NTTAA)

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note)

[[Page 53725]]

directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so would be inconsistent with applicable law or 
otherwise impractical. Voluntary consensus standards are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures, and business practices) that are developed or adopted by 
voluntary consensus standards bodies. NTTAA directs agencies to provide 
Congress, through OMB, explanations when the Agency decides not to use 
available and applicable voluntary consensus standards.
    This action modifies existing regulations to correct an error in 
the regulations and therefore involves technical standards previously 
established by EPA. The amendments to the regulations do not involve 
the application of new technical standards. EPA is continuing to use 
the technical standards previously established in its rules regarding 
the light-duty vehicle GHG standards for MYs 2017-2025. See 77 FR 62960 
and 85 FR 25265.

K. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    The EPA believes that this action does not have disproportionately 
high and adverse human health or environmental effects on minority 
populations, low-income populations and/or indigenous peoples, as 
specified in Executive Order 12898 (59 FR 7629, February 16, 1994). 
This regulatory action merely corrects previously established 
provisions that auto manufacturers use to demonstrate compliance for 
light-duty vehicles.

List of Subjects in 40 CFR Part 600

    Environmental protection, Administrative practice and procedure, 
Electric power, Fuel economy, Labeling, Reporting and recordkeeping 
requirements.

Andrew Wheeler,
Administrator.
[FR Doc. 2020-17214 Filed 8-28-20; 8:45 am]
BILLING CODE 6560-50-P


