[Federal Register Volume 87, Number 29 (Friday, February 11, 2022)]
[Rules and Regulations]
[Pages 7956-7964]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-02588]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 571

[Docket No. NHTSA-2021-0004]
RIN 2127-AL88


Federal Motor Vehicle Safety Standards; Compressed Natural Gas 
Fuel Container Integrity

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation (DOT).

ACTION: Final rule.

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

SUMMARY: This final rule amends the visual inspection labeling 
requirement in Federal Motor Vehicle Safety Standard (FMVSS) No. 304, 
``Compressed natural gas fuel container integrity,'' by modifying the 
periodic inspection interval for compressed natural gas (CNG) fuel 
containers installed on vehicles with a gross vehicle weight rating 
(GVWR) greater than 4,536 kilograms (10,000 pounds). The inspection 
interval for these vehicles is modified from the currently-specified 
interval, ``at least every 36 months or 36,000 miles, whichever comes 
first,'' to ``at least every 12 months.'' For commercial operators of 
CNG heavy vehicles that often travel 100,000 miles per year or more, 
this change will eliminate the need to

[[Page 7957]]

perform unnecessary multiple visual inspections of their vehicles' CNG 
fuel containers per year. NHTSA believes this final rule is equally 
protective of safety as the cadence of inspection required by the 
current rule. This rulemaking commenced in response to petitions for 
rulemaking from the American Trucking Associations and Natural Gas 
Vehicles for America.

DATES: 
    Effective date: This final rule is effective March 14, 2022.
    Compliance date: The compliance date for the amendments in this 
final rule is March 14, 2023. Optional early compliance is permitted.
    Petitions for reconsideration: Petitions for reconsideration of 
this final rule must be received not later than March 28, 2022.

ADDRESSES: Petitions for reconsideration of this final rule must refer 
to the docket and notice number set forth above and be submitted to the 
Administrator, National Highway Traffic Safety Administration, 1200 New 
Jersey Avenue SE, Washington, DC 20590. Note that all petitions 
received will be posted without change to http://www.regulations.gov, 
including any personal information provided. All submissions will be 
placed in the docket for this rulemaking. For more information, please 
see the Privacy Act heading under Rulemaking Analyses and Notices.

FOR FURTHER INFORMATION CONTACT: Mr. Ian MacIntire, Office of 
Crashworthiness Standards; telephone: 202-493-0248; facsimile: 202-493-
2990, or Mr. Daniel Koblenz, Office of Chief Counsel; telephone: 202-
366-2992; facsimile: 202-366-3820. The mailing address for these 
officials is: National Highway Traffic Safety Administration, 1200 New 
Jersey Avenue SE, Washington, DC 20590.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction
II. NPRM
III. Summary of and Response to Comments
IV. Final Rule
V. Analysis of Costs and Benefits
VI. Compliance Date
VII. Regulatory Notices and Analyses

I. Introduction

    NHTSA is issuing this final rule to amend the periodic inspection 
interval (i.e., inspections that occur on a schedule, rather than after 
an incident) stated on the visual inspection label that is required 
under paragraph S7.4 of FMVSS No. 304, ``Compressed natural gas fuel 
container integrity.'' Under the current standard, CNG fuel containers 
must be permanently affixed with a label that states, among other 
things, that the container should be visually inspected after a motor 
vehicle accident or fire and at least every 36 months or 36,000 miles, 
whichever comes first, for damage and deterioration (S7.4(g)). The 
statement is required regardless of the vehicle's GVWR. NHTSA has 
determined that, although the label's recommended inspection intervals 
are appropriate for CNG light vehicles (i.e., vehicles with a GVWR less 
than or equal to 4,536 kilograms (kg) (10,000 pounds (lb)), they are 
inappropriate for CNG heavy vehicles (i.e., vehicles with a GVWR 
greater than 4,536 kg), which are generally driven many more miles per 
year than light vehicles.
    NHTSA has reached this conclusion because the driving patterns and 
conditions under which CNG heavy vehicles travel are very different 
from those of CNG light vehicles, making the current time and mileage 
intervals inappropriate for CNG heavy vehicles. CNG light vehicles are 
typically used in commercial and non-commercial applications for which 
their annual Vehicle Miles Travelled (VMT) is between 10,000 miles and 
12,000 miles. By contrast, CNG heavy vehicles are used almost 
exclusively in commercial operations in which their annual VMT is much 
higher, with the annual VMT of the heaviest CNG vehicles often 
exceeding 100,000 miles. Per accepted industry practice and State-
imposed inspection requirements,\1\ commercial operators of high-
mileage CNG vehicles typically inspect their vehicles in accordance 
with the inspection interval printed on the container's label. As the 
current label indicates that operators should perform visual 
inspections every 36,000 miles, this amounts to multiple inspections 
per year.
---------------------------------------------------------------------------

    \1\ As we noted in the NPRM, at least 20 States have adopted 
into law National Fire Protection Association (NFPA) Code 52, 
``Vehicular Natural Gas Fuel Systems,'' which specifies that 
operators of commercial vehicle visually inspect CNG fuel containers 
in accordance with the visual inspection label permanently affixed 
to the container per FMVSS No. 304.
---------------------------------------------------------------------------

    CNG fuel container failures are extremely rare occurrences, and 
NHTSA is not aware of any data or analyses suggesting that performing 
multiple visual inspections of CNG fuel containers per year has made 
failures less likely to occur. The agency requested information on this 
subject, but the proposal only received six comments, five of which 
were from industry stakeholders that supported the revision and one was 
from an individual commenter who also supported the rule, and none of 
these commenters provided any information on this question. In view of 
this information, NHTSA has concluded that there is not a safety need 
for commercial operators of high-mileage CNG heavy vehicles to conduct 
multiple visual inspections of their vehicles' CNG fuel containers per 
year. This final rule amends the visual inspection label by eliminating 
the mileage interval for CNG heavy vehicles, and amending the time 
interval for these vehicles to once every 12 months. NHTSA believes 12 
months is an appropriate interval because the Agency is not aware of 
any evidence that a more frequent inspection interval would have a 
safety benefit. Furthermore, a 12-month interval aligns the FMVSS No. 
304 visual inspection label with the Federal Motor Carrier Safety 
Administration's (FMCSA) inspection regulations, which require that 
commercial vehicles, including fuel systems, be inspected annually.

II. NPRM

    NHTSA initiated this rulemaking in response to two petitions for 
rulemaking the Agency received in 2016 from the American Trucking 
Associations (ATA) \2\ and Natural Gas Vehicles for America (NGV 
America),\3\ both of which requested that NHTSA address the issue of 
potentially too-frequent visual inspections by eliminating the mileage 
interval on the visual inspection label required under S7.4 (g) of 
FMVSS No. 304.
---------------------------------------------------------------------------

    \2\ According to its website, ATA is the largest national trade 
association for the trucking industry and covers every type of motor 
carrier in the U.S.
    \3\ According to its website, NGV America is a trade association 
that represents companies, environmental groups, and organizations 
interested in the promotion and use of natural gas as motor fuel.
---------------------------------------------------------------------------

    FMVSS No. 304 requires each CNG fuel container to be permanently 
labeled with the information specified in paragraphs (a) through (h) of 
S7.4. Currently, paragraph S7.4(g) specifically requires this label to 
include the following statement:

    This container should be visually inspected after a motor 
vehicle accident or fire and at least every 36 months or 36,000 
miles, whichever comes first, for damage and deterioration.

    After receiving the petitions from ATA and NGV America, NHTSA 
conducted an analysis of whether the current 3-year/36,000-mile visual 
inspection interval would be appropriate for CNG heavy vehicles, and if 
not, what an appropriate interval would be. The current inspection 
interval was chosen based on an analysis of CNG light vehicles, which

[[Page 7958]]

are driven around 10,000 to 12,000 miles annually in both commercial 
and non-commercial contexts, which works out to approximately one 
inspection every three years for these vehicles. Because CNG heavy 
vehicles are expected to be used in exclusively commercial applications 
and typically have higher annual VMTs than their light vehicle 
counterparts, a 3-year/36,000-mile visual inspection interval could 
equate to up to 2-3 visual inspections per year. Further, as it is 
accepted industry practice (and, in many States, a requirement) for 
commercial CNG vehicle operators to follow the visual inspection label 
required under FMVSS No. 304, these commercial operators are generally 
conduct these multiple inspections.
    The visual inspection is a detailed inspection of the fuel 
container and its components.\4\ According to the NGV America guidance 
on the detailed visual inspection, shielding, enclosures, and 
coverings, as well as any system access panels are removed. The CNG 
fuel container and components are inspected for any damage including 
dents, gouges, scrapes, cuts, abrasions, discoloration, heat damage, 
and any form of corrosion. The valves and valve covers are inspected 
for signs of wear, damage, or leakage.
---------------------------------------------------------------------------

    \4\ Compressed Natural Gas Fuel System Inspection Guidance, NGV 
America Technology and Development Committee, https://ngvam.wpengine.com/wp-content/uploads/2019/11/CNG-Vehicle-Fuel-System-Inspection-Guidance-1.pdf.
---------------------------------------------------------------------------

    As part of its analysis into the net safety benefits of multiple 
annual inspections, NHTSA reviewed a 2013 report sponsored by FMCSA on 
CNG fuel container safety.\5\ The report summarized the findings of a 
study investigating how to improve CNG-related regulations. In this 
report, the authors (who were contractors for FMCSA) recommended the 
removal of the mileage interval from the required visual inspection 
label since it was not intended for high-mileage commercial vehicles 
and because the study participants stated that multiple visual 
inspections per year to be ``burdensome and unnecessary.''
---------------------------------------------------------------------------

    \5\ FMCSA-RRT-13-044, ``Natural Gas Systems: Suggested Changes 
to Truck and Motorcoach Regulations and Inspection Procedures,'' 
March 2013, https://rosap.ntl.bts.gov/view/dot/83.
---------------------------------------------------------------------------

    NHTSA also analyzed data on all CNG fuel container failures from 
1984 to 2015 (the most recent data available).\6\ NHTSA's analysis of 
the CNG fuel container failures found that, over this period, there 
have been a total of only 16 CNG fuel container failures in the United 
States in the 32-year period, most of which were caused by problems 
other than those detectable through a visual inspection, such as 
crashes, design flaws, or over-pressurization.\7\ In fact, based on 
available information, it is not clear that any of these failures could 
have been prevented by the periodic visual inspections. Although 
periodic visual inspections could potentially detect problems such as 
gouging on the container surface from the mounting brackets, general 
damage from roadside debris, external corrosion, and damage to valves, 
such factors were not related to these 16 container failures. Periodic 
visual inspections would not protect against the possibility of failure 
due to over-pressurization or internal corrosion, and do not prevent 
container failures in a vehicle collision or fire. As this dataset did 
not state how recently or frequently the CNG fuel containers had been 
visually inspected prior to failure, NHTSA could not draw any 
conclusions from it relating to the appropriate frequency of visual 
inspections for fuel containers on heavy CNG vehicles. However, the 
extreme infrequency of CNG container failures over the 32-year 
period,\8\ and the absence of failures that might have been prevented 
by way of a more frequent than annual visual inspection, suggest there 
is not a safety need to conduct multiple visual inspections of CNG 
containers per year.
---------------------------------------------------------------------------

    \6\ The source of this data was the Clean Vehicle Education 
Foundation (CVEF) Master Incident List, which provides information 
about all reported CNG incidents in the world through 2015. The CVEF 
Master Incident List is maintained by NGV America. A copy of the 
CVEF Master Incident List is available in the docket indicated in 
the heading of this notice.
    \7\ Among the 16 CNG fuel container failures, eight were caused 
by stress corrosion cracking from exposure to chemicals and acid 
that resulted in degradation of the glass fibers used in some 
container designs. In 2001, the American National Standards 
Institute (ANSI) revised the NGV 2 standard to address this issue, 
and there have been no reported failures of this type since. Of the 
remaining eight failures, two were caused by failure of pressure 
relief devices (PRD) to operate in a fire, one was caused by over-
pressurization by faulty fueling systems, three were caused by a 
combination of stress corrosion cracking, physical damage, and over-
pressurization, and two container failures were caused by physical 
damage due to impact in vehicle crashes.
    \8\ There are too few container failures to evaluate annual 
trends.
---------------------------------------------------------------------------

    On June 21, 2019, NHTSA published the NPRM preceding this final 
rule, proposing to amend the statement required under S7.4(g) so that 
it includes separate, discrete periodic inspection intervals for light 
and heavy CNG vehicles.\9\ NHTSA proposed that the inspection interval 
for CNG fuel containers installed on light vehicles would be unchanged 
from the current standard, whereas the inspection interval for CNG fuel 
containers installed on heavy vehicles would be changed to at least 
once every 12 months, with no mileage interval.
---------------------------------------------------------------------------

    \9\ 84 FR 29145.
---------------------------------------------------------------------------

    Given the absence of evidence of any increased safety risk 
associated with performing just one (rather than multiple) inspection 
per year, NHTSA tentatively concluded in the NPRM that the 3-year/
36,000-mile visual inspection interval on the label is not justified by 
a safety benefit. Accordingly, NHTSA tentatively concluded that 
changing the label to recommend a 12-month inspection interval, without 
a mileage interval, eliminated the need to conduct unnecessary visual 
inspections. An annual inspection interval would also have the 
advantage of synchronizing the label's inspection interval with FMCSA 
regulations that state that commercial vehicles must be inspected 
annually, thus limiting the cost of compliance with the label's 
recommendations.\10\

III. Summary of and Response to Comments

    NHTSA received six comments in response to the NPRM. The comments 
were submitted by the two petitioners (NGV America and ATA), the 
National Waste & Recycling Association (NWRA),\11\ Hexagon Mobile 
Pipeline LLC (Hexagon),\12\ Agility Fuel Solutions LLC (Agility),\13\ 
and one individual.
---------------------------------------------------------------------------

    \11\ As self-described on its website, NWRA is a trade 
association representing nearly 70 percent of the private sector 
waste and recycling industry. Its nearly 700 members operate in all 
50 States and the District of Columbia and are a mix of publicly-
traded and privately-owned local, regional, and Fortune 500 national 
and international companies.
    \12\ As self-described on its website, Hexagon produces high-
pressure composite storage cylinders and transportation modules for 
CNG and biogas.
    \13\ As self-described on its website, Agility is a global 
provider of clean fuel ``solutions'' for medium and heavy duty 
commercial vehicles.
---------------------------------------------------------------------------

    The commenters uniformly supported the adoption of the proposed 
rule, and voiced agreement with NHTSA's analysis and conclusions 
regarding the costs and safety impacts on operators of CNG heavy 
vehicles of changing the visual inspection label. NWRA requested that 
NHTSA impose an inspection documentation requirement. NHTSA has not 
adopted such a requirement in the final rule, as doing so would be both 
beyond the scope of this rulemaking, and beyond NHTSA's authority. 
Adding an inspection documentation requirement would not be in the 
scope of this rulemaking because we did not propose, or seek comment 
on, the establishment of an inspection documentation requirement. Such 
a requirement would be beyond

[[Page 7959]]

NHTSA's authority because NHTSA is not authorized to enforce inspection 
requirements for commercial operators of CNG vehicles. NHTSA does not 
regulate how motor vehicles or motor vehicle equipment are used and 
maintained by commercial operators.
    Agility suggested several changes to the proposed regulatory text 
that it believed would improve the readability of the visual inspection 
label without making substantive changes. We have decided not to adopt 
these changes. First, we do not have evidence indicating that replacing 
``motor vehicle accident'' with ``accident'' would be meaningful. We 
have treated those terms as interchangeable in previous FMVSS No. 304 
rulemakings relating to the inspection label.\14\ Second, we believe 
that placing the phrase ``at least'' before the list of periodic 
inspection intervals could cause confusion because the label would read 
as though both ``(a)'' and ``(b)'' of the regulatory text could apply 
to the same vehicle, which is not correct because the two different 
inspection intervals apply to different weight classes. Finally, we 
believe that the change to the description of the weight class in (b), 
while shorter than the proposed regulatory text, would reduce clarity 
of the label by eliminating the parallel sentence structures of (a) and 
(b).
---------------------------------------------------------------------------

    \14\ See, e.g., 60 FR 57943.
---------------------------------------------------------------------------

IV. Final Rule

    After considering the information submitted by the petitioners and 
the comments received, we are adopting the changes to the visual 
inspection label proposed in the NPRM. Under this final rule, the 
portion of the label describing the recommended periodic inspection 
interval is bifurcated into separate instructions for light and heavy 
vehicles.
    For light vehicles, the time and mileage inspection intervals are 
unchanged from the current S7.4(g) (every 3 years or 36,000 miles), 
since NHTSA believes the intervals described in the current S7.4(g) are 
still appropriate for light vehicles.\15\ However, for heavy CNG 
vehicles, the label would describe a periodic inspection interval of 
once per year, with no mileage interval. As noted earlier, this 
interval for heavy CNG vehicles is consistent with FMCSA's annual 
inspection interval for commercial vehicles. NHTSA has concluded that 
this rule is not anticipated to have an impact on vehicle safety. As we 
explained earlier and in the NPRM, NHTSA is not aware of any evidence 
that multiple visual inspections of CNG fuel containers per year 
provides a safety benefit.
---------------------------------------------------------------------------

    \15\ As explained in the NPRM, the time and mileage intervals on 
the current visual inspection label were based on the best field 
data available on CNG vehicles at the time FMVSS No. 304 was 
established in 1995. 61 FR 47086, September 6, 1996. Because, at 
that time the CNG fleet primarily consisted of light vehicles, this 
field data reflected the driving patterns of light vehicles, which 
typically have an annual VMT of approximately 10,000 to 12,000 
miles. More recent data on VMT collected by the U.S. Federal Highway 
Administration (FHWA) shows that the annual VMT for light vehicles 
has not changed, with annual light vehicle VMT holding steady at 
about 11,000 miles for both 2014 and 2015. Data obtained from the 
FHWA Office of Highway Policy Information--Annual Vehicle Distance 
Traveled in Miles and Related Data--2015 by Highway Category and 
Vehicle Type. https://www.fhwa.dot.gov/policyinformation/statistics/2015/vm1.cfm. As there has not been a major change to the driving 
patterns of CNG light vehicles since NHTSA established FMVSS No. 
304, and NHTSA is not otherwise aware of evidence suggesting that 
the 3-year/36,000-mile inspection interval is no longer appropriate 
for CNG light vehicles, NHTSA did not change the inspection interval 
for light vehicles.
---------------------------------------------------------------------------

    NHTSA recognizes that, for low-mileage heavy CNG heavy vehicles, 
the amended label could result in more frequent inspections than now 
specified under the current label. This is because under the existing 
label, the vehicles do not have to have a yearly inspection if they are 
used less than the 12,000 miles a year (on average), while under the 
revised label, a yearly inspection is specified, regardless of mileage. 
Two of the commenters, Hexagon and NGV America, addressed this issue 
and supported the proposed inspection interval for low-mileage vehicles 
as well. Hexagon stated that an inspection interval of one year was 
beneficial for low-mileage commercial CNG heavy vehicles because low-
mileage commercial operations that use CNG heavy vehicles, such as 
refuse collection,\16\ have more incidents than other sectors. NGV 
America stated that low-mileage commercial operations often operate in 
rigorous environmental conditions warranting a yearly inspection, and, 
moreover, are already subject to the FMCSA's requirement that 
commercial vehicles undergo an annual inspection.\17\ Thus, as these 
commenters concurred that a one-year inspection interval is appropriate 
even for low-mileage CNG heavy vehicles, NHTSA concludes the proposed 
labeling requirement is appropriate for these vehicles as well.
---------------------------------------------------------------------------

    \16\ We note that the comment from the National Waste and 
Recycling Association, which represents the commercial operators of 
waste collection trucks, indicated its support of the proposed 
amendments to the visual inspection label.
    \17\ Agility also commented in support of a 12-month inspection 
interval for low-mileage CNG commercial vehicles.
---------------------------------------------------------------------------

    Given the infrequency with which CNG failures currently occur, the 
Agency believes that conducting multiple visual inspections of CNG 
containers per year on heavy vehicles is unnecessary. That said, the 
contrary is not supported--NHTSA has not made a determination that 
fewer than one visual inspection per year is supported. In addition, 
the Agency lacks field data to support recommending a longer visual 
inspection interval, such as every 3 years or 5 years, and received no 
feedback or data from commenters that would advocate for such a change. 
Because heavy vehicles in commercial fleets tend to travel 
significantly more miles than light vehicles, the CNG fuel containers 
on heavy vehicles may be exposed to more wear and tear in a given 
period of time than CNG fuel containers on light vehicles. Accordingly, 
NHTSA concludes that an annual visual inspection interval is more 
appropriate than a less frequent interval as inspectors are more likely 
in an annual inspection cycle to identify and remedy damage to the CNG 
fuel container and fuel system than compared to, say, a 3-year or 5-
year inspection interval.
    The CNG industry (including container manufacturers, vehicle 
integrators, CNG vehicle fleet operators) agree that an annual visual 
inspection of CNG containers on heavy vehicles would reduce inspection 
costs without a reduction in safety.

V. Analysis of Costs and Benefits

    Because NHTSA does not expect this rule to affect vehicle safety, 
the net benefit of this rule is a reduction in costs to operators of 
CNG heavy vehicles who will no longer perform multiple visual 
inspections per year. The magnitude of this reduction in costs depends 
on the size of the CNG heavy vehicle fleet, the number of excess visual 
inspections that are performed based on the suggestion on the current 
label's mileage interval, and the cost of conducting those additional 
visual inspections. Note that, for purposes of estimating costs and 
benefits, CNG heavy vehicles were broken down into two categories: CNG 
medium duty vehicles (with a GVWR greater than 4,536 kg (10,000 lb) and 
less than or equal to 11,793 kg (26,000 lb)) and CNG heavy duty 
vehicles (with a GVWR greater than 11,793 kg).
    NHTSA estimated the size of the CNG heavy vehicle fleet, which 
consists of CNG medium duty vehicles and CNG heavy duty vehicles, using 
data from

[[Page 7960]]

NGV America.\18\ According to NGV America, there are approximately 
25,800 CNG medium duty vehicles and 39,500 CNG heavy duty vehicles 
currently in operation in the United States.
---------------------------------------------------------------------------

    \18\ As we explained in the NPRM, although both NGV America and 
the U.S. Energy Information Agency (EIA) tracks the size of the CNG 
vehicle fleet, NHTSA believes that NGV America's estimate is more 
accurate than EIA's because NGV America bases its estimates on data 
obtained from its members, whereas EIA bases its estimates on 
vehicle registration data obtained from States. NHTSA believes that 
using vehicle registrations to estimate the size of the CNG vehicle 
fleet would systematically undercount the number of CNG vehicles 
because many States do not require fuel type to be noted on the 
vehicle registration, and because many CNG heavy vehicles operating 
today were converted from diesel-fueled vehicles after the first 
vehicle purchase. The NGV America fleet and sales data from December 
2014 is available at https://www.ngvamerica.org/wp-content/uploads/2018/09/2014-NGV-Production-and-Sales-Report.pdf.
---------------------------------------------------------------------------

    NHTSA estimated the annual average VMT for CNG heavy vehicles by 
using a published business model that estimates the minimum annual 
average VMT that a CNG heavy vehicle operator would be required to 
maintain to achieve a 20 percent return on investment for converting a 
diesel heavy vehicle to use CNG.\19\ According to this model, if the 
per-gallon price of diesel is $1.25 more than the per-diesel gallon 
equivalent (DGE) for CNG, the required average annual VMT required to 
maintain a 20 percent return on investment is 75,000 miles for CNG 
medium duty vehicles, and 125,000 miles for CNG heavy duty 
vehicles.\20\ As discussed above, commenters supported NHTSA's 
assumption in the NPRM that inspections would generally be performed as 
suggested on the label. Using the more conservative estimate of 108,000 
VMT for CNG heavy duty vehicles and 72,000 VMT for CNG medium duty 
vehicles, we estimate that, under the current 36,000-mile mileage 
interval, a CNG heavy duty vehicle would be inspected 3 times per year 
(108,000 / 36,000 = 3), and a CNG medium duty vehicle would be 
inspected two times per year (72,000 / 36,000 = 2).
---------------------------------------------------------------------------

    \19\ Dee, Anna Lea, ``What Set of Conditions Would Make the 
Business Case to Convert Heavy Trucks to Natural Gas?--a Case 
Study,'' National Energy Policy Institute, 2012. This model accounts 
for several factors that affect return on investment, including the 
capital investment required to convert a diesel vehicle to run on 
CNG; the relative costs of fueling infrastructure and vehicle 
maintenance between CNG and diesel vehicles; and the relative fuel 
economy of CNG and diesel vehicles.
    \20\ According to the Department of Energy, the price of diesel 
fuel at the time of this analysis was $3.08 per gallon, whereas the 
price of CNG was $2.49 per diesel gallon equivalent (DGE)--a 
differential of $0.59. See https://afdc.energy.gov/files/u/publication/alternative_fuel_price_report_oct_2019.pdf. Because fuel 
prices tend to fluctuate over time, our analysis here assumes a 
price differential of $1.25, which is the same as the analysis in 
the NPRM.
---------------------------------------------------------------------------

    NHTSA estimated the per-inspection cost of visual inspections using 
information provided by ATA in its petition for rulemaking. According 
to ATA, visual inspections cost between $200 and $500 per vehicle, and 
require a CNG vehicle to have a 2-day downtime for the inspection at a 
cost of about $150 per day.\21\ Based on these estimates, NHTSA 
calculated the cost of a single inspection to be $500 ($200 + $150 x 2) 
to $800 ($500 + $150 x 2), with an average of $650 ($350 + $150 x 2).
---------------------------------------------------------------------------

    \21\ This cost includes inspection by a trained and qualified 
inspector and removal and replacement of shields or covers of the 
CNG fuel containers before and after the inspection. The downtime 
cost is also assumed that the inspection will occur when the vehicle 
would otherwise be in-use, not, for example, if it is out of service 
for some other reason (e.g., if the inspection occurs on the weekend 
or when a particular fleet vehicle is not required to be in use).
---------------------------------------------------------------------------

    As previously mentioned, NGV America's production and sales report 
estimated the inventory of medium duty and heavy duty CNG vehicles was 
25,800 and 39,500, respectively, in 2014. NHTSA believes these 
estimates are the most accurate available for the CNG industry, and 
therefore assumes these figures as the average annual inventory for CNG 
heavy vehicles. As we noted in the NPRM, our analysis may be a low 
estimate of the total cost saving because projections indicate the 
annual sale of CNG heavy vehicles used in commercial fleets will 
increase to 68,000 in 2040, which would lead to a significant increase 
in the number of these vehicles in the overall heavy vehicle 
fleet.22 23
---------------------------------------------------------------------------

    \22\ Baker, et al., ``Alternative Fuel Vehicle Forecasts (April 
2016),'' Texas A&M Transportation Institute, https://static.tti.tamu.edu/tti.tamu.edu/documents/PRC-14-28F.pdf.
    \23\ While NHTSA did not use the AEO2017 data in its cost/
benefit analysis due to underreporting of the current size of the 
CNG fueled heavy vehicle fleet, we note that the AEO2017 data 
estimates an increase in the CNG medium and heavy duty vehicle fleet 
by 2040. According to AEO2017 projected estimates, there would be 
16,335 CNG medium duty vehicles and 74,469 CNG heavy duty vehicles 
in 2040. By contrast, the AEO2017 estimates that in 2015, there were 
2,150 CNG medium duty vehicles and 22,350 CNG heavy duty vehicles.
---------------------------------------------------------------------------

    Using the above estimates, NHTSA calculated the total annual cost 
savings from reduced number of visual inspections of CNG containers in 
the CNG heavy vehicle fleet, regardless of whether the container has 
the current visual inspection label or the new modified label. Again, 
this analysis assumes that the heavy vehicle fleet size remains 
unchanged in the future. With these assumptions along with inspection 
cost estimates, the potential total annual cost savings due to reduced 
number of CNG fuel container inspections range between $52.40 million 
to $83.84 million with an average cost savings of $68.12 million, as 
shown in Table 1. Because these estimated annual cost savings are 
constant across all years into the future, annualized values are 
similar for all discount rates, as shown in Table 2. As noted above, 
since the CNG heavy vehicle fleet size is expected to increase in the 
future, the annual cost savings presented in Table 1 are conservative.

  Table 1--Annual Cost Savings From Conducting Yearly Inspection of All CNG Containers on the CNG Heavy Vehicle
                                                      Fleet
                                                     [2020$]
----------------------------------------------------------------------------------------------------------------
                                                                                Cost of inspection
                                                                 -----------------------------------------------
                                                                        Low           Average          High
----------------------------------------------------------------------------------------------------------------
Cost of Single Inspection (a)...................................            $500            $650            $800
Number of CNG Heavy Duty Vehicles (b)...........................          39,500          39,500          39,500
Number of CNG Medium Duty Vehicles (c)..........................          25,800          25,800          25,800
Number of Inspections Reduced Per Year for Heavy Duty Vehicles                 2               2               2
 (d)............................................................
Number of Inspections Reduced Per Year for Medium Duty Vehicles                1               1               1
 (e)............................................................
Cost Reduction for Heavy Duty Vehicles (f) = (a) x (b) x (d) in           $39.50          $51.35          $63.20
 Millions.......................................................
Cost Reduction for Medium Duty Vehicles (g) = (a) x (c) x (e) in          $12.90          $16.77          $20.64
 Millions.......................................................
                                                                 -----------------------------------------------

[[Page 7961]]

 
    Total Annual Cost Saving (f) + (g) in Millions..............          $52.40          $68.12          $83.84
----------------------------------------------------------------------------------------------------------------

VI. Compliance Date

    Because this final rule will eliminate the current requirement that 
results in multiple visual inspections per year for heavy vehicles in 
favor of a requirement for an equally safety protective annual 
inspection, we believe a mandatory compliance date of one year after 
the date of publication of this document in the Federal Register is 
appropriate, with optional early compliance permitted. We believe one 
year is sufficient time to make needed changes to the visual inspection 
label for CNG fuel containers with no additional cost, and that 
permitting early compliance will provide manufacturers with 
flexibility.
    We note that, while this rule does not apply retroactively to 
containers manufactured before the mandatory compliance date, there may 
be instances in which an operator may want to replace a previously-
existing visual inspection label with a new label with the amended time 
interval. As to whether such a replacement would be a violation of the 
``make inoperative'' provision of the Safety Act, our answer is no, 
assuming the container will be permanently labeled with the new label 
as specified in S7.4 and contains all the information required by S7.4. 
49 U.S.C. 30122 states, in relevant part: ``A manufacturer, 
distributor, dealer, rental company, or motor vehicle repair business 
may not knowingly make inoperative any part of a device or element of 
design installed on or in a motor vehicle or motor vehicle equipment in 
compliance with an applicable motor vehicle safety standard.'' 
Replacing the previously-existing label with the new label by an entity 
listed in Sec.  30122 would not be a violation of the make inoperative 
provision because the new label serves the same function and safety 
need as the previous label, only more efficiently. Both labels inform 
the operator of how frequently CNG fuel containers should be inspected, 
with the new label reflecting the need for motor vehicle safety more 
accurately. Thus, replacing the label does not make inoperative a 
device or element of design installed on or in the vehicle in 
compliance with FMVSS No. 304.\24\
---------------------------------------------------------------------------

    \24\ 49 U.S.C. 30122. Note that the ``make inoperative'' 
prohibition applies only to manufacturers, distributors, dealers, 
rental companies, and motor vehicle repair businesses; it would not 
apply to a commercial operator of a CNG vehicle modifying his or her 
own vehicle.
---------------------------------------------------------------------------

VII. Regulatory Notices and Analyses

Executive Order (E.O.) 12866, E.O. 13563, and DOT Rulemaking Procedures

    NHTSA has considered the impact of this final rule under Executive 
Orders 12866 and 13563, and the Department of Transportation's 
administrative rulemaking procedures. This final rule was deemed to be 
non-significant under Executive Order 12866 by the Office of 
Information and Regulatory Affairs, and is not considered a rulemaking 
of special note to the Department under DOT Order 1200.6A.
    NHTSA is modifying the required label for visual inspection of CNG 
fuel containers to specify that the container should be visually 
inspected for damage and deterioration after a motor vehicle accident 
or fire, and either (a) at least every 12 months when installed on a 
vehicle with a GVWR greater than 4,536 kg or (b) at least every 36 
months or 36,000 miles, whichever comes first, when installed on a 
vehicle with a GVWR less than or equal to 4,536 kg. NHTSA has not found 
any evidence that this change will impact motor vehicle safety. NHTSA 
believes that the only substantive effect of this final rule will be to 
eliminate unnecessary visual inspections of CNG fuel containers by 
operators of high-mileage CNG heavy vehicles and align the CNG 
container inspections for low-mileage CNG heavy vehicles with FMCSA's 
annual inspection interval.
    NHTSA estimates the change will reduce the number of visual 
inspections per year by approximately 2 inspections for heavy duty CNG 
vehicles and by approximately 1 inspection for medium duty CNG 
vehicles. The agency further estimates that the elimination of these 
visual inspections will result in an average annual cost savings of 
$68.12 million, assuming the current CNG heavy vehicle fleet size 
remains unchanged.

Regulatory Flexibility Act

    Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601 et seq., 
as amended by the Small Business Regulatory Enforcement Fairness Act 
(SBREFA) of 1996), whenever an agency is required to publish a notice 
of proposed rulemaking or final rule, it must prepare and make 
available for public comment a regulatory flexibility analysis that 
describes the effect of the rule on small entities (i.e., small 
businesses, small organizations, and small governmental jurisdictions) 
unless the head of an agency certifies the rule will not have a 
significant economic impact on a substantial number of small entities. 
The Small Business Administration's regulations at 13 CFR part 121 
define a small business, in part, as a business entity ``which operates 
primarily within the United States.'' (13 CFR part 121.105(a)). SBREFA 
amended the Regulatory Flexibility Act to require Federal agencies to 
provide a statement of the factual basis for certifying that a proposed 
or final rule will not have a significant economic impact on a 
substantial number of small entities.
    I certify that this final rule will not have a significant impact 
on a substantial number of small entities. There are two types of 
businesses that will potentially be impacted by this rule: 
Manufacturers of CNG fuel containers and commercial operators of CNG 
heavy vehicles. Small manufacturers of CNG fuel containers are directly 
impacted by this rule because they are required to modify the language 
on the visual inspection label. However, as the label itself is already 
required (only the wording is changing), NHTSA expects this to be a 
negligible, one-time expense for these businesses. As explained in 
earlier in this Notice, commercial operators of CNG heavy vehicles are 
indirectly impacted by this rule because the amended visual inspection 
label will indirectly cause the elimination of multiple unnecessary 
visual inspections these businesses must perform per year. Small 
operators of CNG heavy vehicles will likely see a reduction in 
maintenance costs because

[[Page 7962]]

of a reduced number of CNG fuel container inspections.
    However, NHTSA does not believe those cost impacts will be 
significant, because the cost savings from reduced inspections would be 
a small percentage of the overall operational cost of the vehicle. To 
illustrate, according to AEO, a medium duty CNG vehicle fuel efficiency 
is 6.9 mpg, and that for heavy vehicle is 5.7 mpg (gasoline gallon 
equivalent). The cost of CNG fuel is $2.27/gasoline gallon equivalent. 
A heavy duty truck traveling 108,000 miles per year spends $43,010 (= 
108,000/5.7 * $2.27) on fuel alone. The cost savings of doing annual 
inspections for a heavy duty vehicle is estimated at $1,300 per year. 
This annual savings is only 3 percent of fuel costs. A medium duty 
truck traveling 72,000 miles per year spends $23,686 (= 72,000/6.9 * 
2.27) on fuel alone. The cost savings of doing annual inspections for a 
medium duty vehicle is estimated at $650. This annual savings would be 
only 2.7 percent of fuel costs.
    The above comparison is limited to fuel costs. There are other 
operational costs that have not been accounted for which would make the 
savings from reduced inspections to be even less than 3 percent 
compared to the cost of operating the vehicles.

National Environmental Policy Act

    NHTSA has analyzed this rulemaking action for the purposes of the 
National Environmental Policy Act (42 U.S.C. 4321 et seq.), as amended. 
The Agency has determined that implementation of this action will not 
have a significant impact on the quality of the human environment. The 
rule merely reduces the number of visual inspections that commercial 
operators of high-mileage CNG heavy vehicles will have to conduct.
    Reducing the number of inspections would reduce the downtime and 
cost of operation of these vehicles. On the days that a CNG heavy 
vehicle is out-of-service for visual inspection, the operations are 
either stopped or continued using a conventional-fuel vehicle. As 
stated above, according to NGV America, there are approximately 25,800 
CNG medium duty vehicles and 39,500 CNG heavy duty vehicles currently 
in operation in the United States. These vehicles therefore make up a 
very small proportion of the on-road medium and heavy duty vehicle 
fleet, and the change in their downtime is a very small proportion of 
their overall use, so any resulting change in medium or heavy duty 
vehicle operation (including by the regulated vehicles) also would be 
very small.
    NHTSA estimates that this rule would, at most, reduce the number of 
visual inspections a CNG operator conducts each year by two for heavy 
duty vehicles and by one for medium duty vehicles. Since an inspection 
takes one to two days to conduct, there could be at most four extra 
days of operation per year (2 inspections x 2 days per inspection = 4 
days of additional operation) for heavy duty vehicles and two extra 
days of operation per year (1 inspection x 2 days per inspection) for 
medium duty vehicles.
    Assuming trips that would otherwise be made using a CNG-fueled 
vehicle are instead made using a diesel-fueled vehicle when the CNG-
fueled vehicle is undergoing a visual inspection, then making CNG heavy 
duty vehicles available for an additional four days annually and CNG 
medium duty vehicles available for an additional two days annually 
would reduce greenhouse gas (GHG) emissions, since heavy CNG vehicles 
have 13-17 percent fewer GHG emissions compared to diesel on a well-to-
wheel basis.\25\ However, on an annual basis, this reduction in GHG 
emissions from increased operation of CNG vehicles would be 
insignificant (i.e., much less than 1 percent) compared to the GHG 
emissions from the total U.S. heavy vehicle fleet. Similarly, 
anticipated changes to other air pollutant emissions would also be very 
small. Thus, any environmental impacts would be appropriately 
considered de minimis.
---------------------------------------------------------------------------

    \25\ Well-to-wheel refers to an analysis that accounts for all 
the energy and emissions necessary to produce the fuel used in the 
vehicle (well-to-pump) and the operation energy and emissions 
associated with the vehicle technology (tail pipe emissions, other 
emissions and energy efficiency of the vehicle).
---------------------------------------------------------------------------

Executive Order 13132 (Federalism)

    NHTSA has examined today's final rule pursuant to Executive Order 
13132 (64 FR 43255; Aug. 10, 1999) and concluded that no additional 
consultation with States, local governments, or their representatives 
is mandated beyond the rulemaking process. The Agency has concluded the 
rule does not have sufficient federalism implications to warrant 
consultation with State and local officials or the preparation of a 
federalism summary impact statement. The rule does 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.''
    NHTSA rules can have preemptive effect in two ways. First, the 
National Traffic and Motor Vehicle Safety Act contains an express 
preemption provision, codified at 49 U.S.C. 30103(b)(1), stating that, 
when a motor vehicle safety standard is in effect, a State or a 
political subdivision of a State may prescribe or continue in effect a 
standard applicable to the same aspect of performance of a motor 
vehicle or motor vehicle equipment only if the standard is identical to 
NHTSA's standard prescribed under this chapter. It is this statutory 
command by Congress (and not today's final rule) that preempts any non-
identical State legislative and administrative law addressing the same 
aspect of performance, so consultation would be inappropriate.
    It is this statutory command by Congress (and not today's final 
rule) that preempts any non-identical State legislative and 
administrative law addressing the same aspect of performance, so 
consultation would be inappropriate.
    Second, the Supreme Court has recognized the possibility, in some 
instances, of implied preemption of State requirements imposed on motor 
vehicle manufacturers, including sanctions imposed by State tort law. 
That possibility is dependent upon there being an actual conflict 
between a FMVSS and the State requirement. If and when such a conflict 
exists, the Supremacy Clause of the Constitution makes the State 
requirements unenforceable. See Geier v. American Honda Motor Co., 529 
U.S. 861 (2000), finding implied preemption of State tort law on the 
basis of a conflict discerned by the court,\26\ not on the basis of an 
intent to preempt asserted by the agency itself.
---------------------------------------------------------------------------

    \26\ The conflict was discerned based upon the nature (e.g., the 
language and structure of the regulatory text) and the safety-
related objectives of FMVSS requirements in question and the impact 
of the State requirements on those objectives.
---------------------------------------------------------------------------

    NHTSA has considered, pursuant to Executive Orders 13132 and 12988, 
whether this final rule could or should preempt State common law causes 
of action. To this end, the Agency has examined the nature (e.g., the 
language and structure of the regulatory text) and objectives of this 
final rule and finds that this final rule is not intended to preempt 
State tort law that effectively imposes a higher standard on regulated 
entities than that would be established by today's final rule. The 
change in this final rule amends a labeling requirement that applies to 
newly manufactured CNG fuel containers; it does not conflict with the 
establishment of a higher standard of safety by means of State tort law 
that applies to the same subject

[[Page 7963]]

matter (i.e., adequate labeling of CNG fuel containers). This rule 
would not preempt state inspection requirements, including those that 
rely on the language on the visual inspection label, because this rule 
does not mandate that the label be followed; states remain free to 
establish inspection requirements as they deem appropriate. Without any 
conflict, there could not be any implied preemption of State law, 
including State tort law.

Executive Order 12988 (Civil Justice Reform)

    With respect to the review of the promulgation of a new regulation, 
section 3(b) of Executive Order 12988, ``Civil Justice Reform'' (61 FR 
4729; Feb. 7, 1996), requires Executive agencies make every reasonable 
effort to ensure the regulation: (1) Clearly specifies the preemptive 
effect; (2) clearly specifies the effect on existing Federal law or 
regulation; (3) provides a clear legal standard for affected conduct, 
while promoting simplification and burden reduction; (4) clearly 
specifies the retroactive effect, if any; (5) specifies whether 
administrative proceedings are to be required before parties file suit 
in court; (6) adequately defines key terms; and (7) addresses other 
important issues affecting clarity and general draftsmanship under any 
guidelines issued by the Attorney General. This document is consistent 
with that requirement.
    Pursuant to this Order, NHTSA notes as follows. The issue of 
preemption is discussed above. NHTSA notes further there is no 
requirement that individuals submit a petition for reconsideration or 
pursue other administrative proceedings before they may file suit in 
court.

Privacy Act

    All submissions, including public comments on this final rule, will 
be placed in the docket. Anyone is able to search the electronic form 
of all documents received into any of our dockets by the name of the 
individual submitting the document (or signing the document, if 
submitted on behalf of an association, business, labor union, etc.). 
You may review DOT's complete Privacy Act Statement in the Federal 
Register published on April 11, 2000 (Volume 65, Number 70; Pages 
19477-78).

Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995 (PRA), a person is not 
required to respond to a collection of information by a Federal agency 
unless the collection displays a valid OMB control number. There are no 
information collection requirements associated with this final rule.

National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law 104-113, as amended by Public Law 107-
107 (15 U.S.C. 272 note), directs the agency to evaluate and use 
voluntary consensus standards in its regulatory activities unless doing 
so would be inconsistent with applicable law or is 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, such as the SAE International. The NTTAA 
directs us to provide Congress (through OMB) with explanations when the 
agency decides not to use available and applicable voluntary consensus 
standards.
    This final rule accords with the NTTAA. FMVSS No. 304 has 
historically drawn largely from ANSI NGV 2. The changes in this final 
rule to the visual inspection label were made in accordance with data 
provided by NGV America and ATA and the recommendations developed by 
industry technical working groups.\27\
---------------------------------------------------------------------------

    \27\ The NGV America Technology & Development Committee's 
Guidance on Fuel System Inspection published in November 2017 
specifies annual visual inspection for CNG fuel containers on heavy 
vehicles as a practical approach to inspection and maintenance of 
the fuel container and fuel system which would match intervals and 
procedures with other vehicle maintenance tasks, such as engine oil 
and filter changes, that are conducted on an annual basis per FMCSR 
396.17. The CSA group, which maintains NGV 2, is considering 
modifying the inspection interval in NGV 2 to an annual inspection 
following the NGV America Technology & Development Committee's 
Guidance document.
---------------------------------------------------------------------------

Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (UMRA) requires Federal 
agencies to prepare a written assessment of the costs, benefits and 
other effects of proposed or final rules that include a Federal mandate 
likely to result in the expenditure by State, local or tribal 
governments, in the aggregate, or by the private sector, of more than 
$100 million annually (adjusted annually for inflation, with base year 
of 1995). UMRA also requires an agency issuing an NPRM or final rule 
subject to the Act to select the ``least costly, most cost-effective or 
least burdensome alternative that achieves the objectives of the 
rule.'' This final rule would not result in a Federal mandate that will 
likely result in the expenditure by State, local or tribal governments, 
in the aggregate, or by the private sector, of more than $100 million 
annually (adjusted annually for inflation, with base year of 1995).

Executive Order 13609 (Promoting Regulatory Cooperation)

    The policy statement in section 1 of Executive Order 13609 
provides, in part: The regulatory approaches taken by foreign 
governments may differ from those taken by U.S. regulatory agencies to 
address similar issues. In some cases, differences between the 
regulatory approaches of U.S. agencies and those of their foreign 
counterparts might not be necessary and might impair the ability of 
American businesses to export and compete internationally. In meeting 
shared challenges involving health, safety, labor, security, 
environmental, and other issues, international regulatory cooperation 
can identify approaches that are at least as protective as those that 
are or would be adopted in the absence of such cooperation. 
International regulatory cooperation can also reduce, eliminate, or 
prevent unnecessary differences in regulatory requirements.
    The European regulation for CNG vehicles, ECE R.110, ``I. Specific 
components of motor vehicles using compressed natural gas (CNG) and/or 
liquefied natural gas (LNG) in their propulsion system,'' \28\ requires 
a detailed visual inspection of CNG fuel containers on vehicles at 
least every 48 months and after an accident or fire. However, the 
working pressure of CNG fuel containers in Europe is 20 Megapascals 
(MPa) (3,000 pounds per square inch (psi)), while that in the U.S. is 
typically 26 MPa (3,600 psi). The higher container pressure in the U.S. 
necessitates more frequent visual inspections than that conducted in 
Europe. Therefore, NHTSA did not consider harmonizing with ECE R.110.
---------------------------------------------------------------------------

    \28\ http://www.unece.org/fileadmin/DAM/trans/main/wp29/wp29regs/2015/R110r3e.pdf.
---------------------------------------------------------------------------

Regulation Identifier Number

    The Department of Transportation assigns a regulation identifier 
number (RIN) to each regulatory action listed in the Unified Agenda of 
Federal Regulations. The Regulatory Information Service Center 
publishes the Unified Agenda in April and October of each year. You may 
use the RIN contained in the heading at the beginning of this document 
to find this action in the Unified Agenda.

List of Subjects in 49 CFR Part 571

    Imports, Motor vehicles, Motor vehicle safety.


[[Page 7964]]


    In consideration of the foregoing, NHTSA amends 49 CFR part 571 as 
follows:

PART 571--FEDERAL MOTOR VEHICLE SAFETY STANDARDS

0
1. The authority citation for part 571 continues to read as follows:

    Authority:  49 U.S.C. 322, 30111, 30115, 30117, and 30166; 
delegation of authority at 49 CFR 1.95.


0
2. In Sec.  571.304, revise S7.4(g) to read as follows:


Sec.  571.304  Standard No. 304; Compressed natural gas fuel container 
integrity.

* * * * *
    S7.4 * * *
    (g) The statement: ``This container should be visually inspected 
for damage and deterioration after a motor vehicle accident or fire, 
and either (a) at least every 12 months when installed on a vehicle 
with a GVWR greater than 4,536 kg, or (b) at least every 36 months or 
36,000 miles, whichever comes first, when installed on a vehicle with a 
GVWR less than or equal to 4,536 kg.''
* * * * *

    Issued under authority delegated in 49 CFR 1.95 and 501.4.
Steven S. Cliff,
Deputy Administrator.
[FR Doc. 2022-02588 Filed 2-10-22; 8:45 am]
BILLING CODE 4910-59-P


