ACC II ISOR

Staff Report: Initial Statement of Reasons

Date of Release: April 12, 2022

Date of Hearing: June 9, 2022

California Air Resources Board

Public Hearing to Consider the Proposed

Advanced Clean Cars II Regulations

Staff Report: Initial Statement of Reasons

Date of Release: April 12, 2022

Scheduled for Consideration:

Board Hearing Date – June 9, 2022

This report has been reviewed by the staff of the California Air Resources Board and

approved for publication. Approval does not signify that the contents necessarily reflect the

views and policies of the California Air Resources Board, nor does mention of trade names or

commercial products constitute endorsement or recommendation for use.

Staff Report: Initial Statement of Reasons

Date of Release

: April 12, 2022

Date of Hearing: June

9, 2022

Table of Contents

Executive Summary ................................................................................................................... 4

I. Introduction and Background ................................................................................................. 0

A. Regulatory History .......................................................................................................... 1

II. The Problem the Proposal is Intended to Address ............................................................... 3

A. Need for Emission Reductions ....................................................................................... 5

B. Advancing Environmental Justice ................................................................................... 9

C. California has unique authority under federal law to regulate vehicle emissions ......... 10

D. California has broad authority under California law to regulate vehicle emissions ...... 11

III. Summary of Staff’s ZEV Regulation Proposal ..................................................................... 12

A. Background .................................................................................................................. 12

1. ZEV Technologies ......................................................................................................... 12

2. ZEV Technology is Rapidly Improving .......................................................................... 13

3. Expansion of the ZEV Market ....................................................................................... 18

4. Importance of the Used Vehicle Market ...................................................................... 21

5. Consumer Challenges Exist and Must be Addressed .................................................. 21

6. Complementary Policies: Equitably Building a Successful ZEV Market ....................... 24

B. Need for Proposed ZEV Regulations ............................................................................ 35

C. Proposed Requirements and Feasibility ....................................................................... 36

ZEV Stringency: Annual ZEV Percentage Requirements ............................................ 36

2. Proposed ZEV Requirement Structure and Compliance Rules .................................. 42

3. Minimum Technical Requirements for ZEVs ............................................................... 46

4. PHEV Allowance and Minimum Technical Requirements ........................................... 56

Environmental Justice Allowances ............................................................................. 60

Early Compliance Values ............................................................................................ 66

SVM treatment ........................................................................................................... 67

Summary of ZEV Regulation Proposals ...................................................................... 67

D. ZEV Assurance Measures .............................................................................................. 69

1. On-Vehicle Data Standardization ................................................................................. 71

2. Durability ...................................................................................................................... 72

3. Warranty ....................................................................................................................... 77

4. Service Information ...................................................................................................... 83

5. Battery Labeling ........................................................................................................... 84

6. Summary of ZEV Assurance Measure Proposals .......................................................... 88

IV. Summary of Staff’s LEV Proposals ...................................................................................... 89

A. Background .................................................................................................................. 90

1. Certification Requirements for Light-Duty Vehicles .................................................. 90

2. Emission Bins and Fleet-Average Standards ................................................................ 90

3. Cold-Start Emissions .................................................................................................... 91

4. High-Powered Starts for PHEVs ................................................................................... 91

5. PM Standards for Aggressive Driving Conditions ........................................................ 92

6. Medium-Duty Vehicles ................................................................................................. 92

7. Conforming amendments to related regulations ......................................................... 93

B. Need for LEV Proposals ................................................................................................ 94

1. Need to Prevent Backsliding of ICEVs as ZEVs Significantly Increase in the New Vehicle

Fleet ................................................................................................................................. 94

2. Need to Reduce High-Powered Cold-Start Emissions from PHEVs ............................. 95

3. Need to Address Cold-Start Emissions Under Real-World Driving Conditions ........... 96

4. Need for More Stringent PM Standards for Aggressive Driving Cycle ...................... 100

5. Need for In-Use Standards for Medium-Duty Vehicles .............................................. 100

6. Need for More Stringent Standards for Medium-Duty Vehicles ................................ 102

7. Need to amend the OBD regulations ........................................................................ 103

C. LEV Proposals and Feasibility ..................................................................................... 104

1. Proposal: Fleet Average Standard without ZEVs ....................................................... 104

2. Proposal: Stand-Alone Standards for Aggressive Driving .......................................... 105

3. Proposal: PM Standard for Aggressive Driving .......................................................... 109

4. Proposal: Cold-Start Emission Control ....................................................................... 110

5. Proposal: PHEV High-Power Cold-Start Emission Standard ...................................... 116

6. Proposal: Lower Running Loss Standard .................................................................... 120

7. Proposal: PEMS In-use Standards for MDVs greater than 14,000 GCWR ................. 121

8. Proposal: Lower Emission Standards for MDV ........................................................... 124

9. Proposal: Standalone Standards for MDV for Aggressive Driving Cycles .................. 128

10. Summary of OBD Proposal ...................................................................................... 131

D. Other Test Procedure Modifications .......................................................................... 132

1. Proposed Split of California’s Light- and Medium-Duty Vehicle Test Procedure ...... 132

2. Proposed Split of California’s Evaporative Emissions Test Procedure ....................... 132

3. Proposed Amendments to California’s Non-Methane Organic Gas Test Procedure 133

4. Proposed Amendments to California’s Test Procedures for Evaluating Substitute Fuels

and New Clean Fuels ..................................................................................................... 133

V. The Specific Purpose and Rationale of Each Adoption, Amendment, or Repeal ............. 133

VI. Benefits Anticipated from the Regulatory Action, Including the Benefits or Goals Provided

in the Authorizing Statute ..................................................................................................... 134

A. Summary of Emission Benefits .................................................................................... 134

B. Summary of Health Benefits ....................................................................................... 135

1. Incidence-Per-Ton Methodology ............................................................................... 135

2. Reduction in Adverse Health Impacts ........................................................................ 136

3. Uncertainties Associated with the Mortality and Illness Analysis ............................... 138

4. Monetization of Health Impacts ................................................................................. 138

C. Greenhouse Gas Reduction Benefits - Social Cost of Carbon .................................... 141

D. Benefits to Manufacturers Making ZEVs ..................................................................... 143

E. Benefits to Individuals – Total Cost of Ownership...................................................... 143

VII. Air Quality – Emission Benefits........................................................................................ 145

F. Baseline Assumptions ................................................................................................. 145

G. Total Emission Benefits ............................................................................................... 146

VIII. Environmental Analysis ................................................................................................... 148

IX. Environmental Justice ...................................................................................................... 150

X. Standardized Regulatory Impact Analysis ......................................................................... 155

A. Changes since the release of the SRIA ....................................................................... 156

1. Updated Technology Package Cost ........................................................................... 156

2. Updated Baseline Assumptions ................................................................................. 163

3. Updated Minor Assumptions for Fleet Modeling ...................................................... 165

4. Changes to ZEV Sales Requirements ......................................................................... 167

5. Total Costs to the Manufacturer ................................................................................ 167

B. The creation or elimination of jobs within the State of California. ............................. 168

C. The creation of new business or the elimination of existing businesses within the State

of California. ...................................................................................................................... 170

D. The expansion of businesses currently doing business within the State of California. 171

E. Significant Statewide Adverse Economic Impact Directly Affecting Business, Including

Ability to Compete ............................................................................................................ 172

F. The competitive advantages or disadvantages for businesses currently doing business

within the state .................................................................................................................. 172

G. The increase or decrease of investment in the state .................................................. 172

H. The incentives for innovation in products, materials, or processes ............................ 173

I. The benefits of the regulation to the health and welfare of California residents, worker

safety, and the state’s environment. .................................................................................. 173

XI. Evaluation of Regulatory Alternatives .............................................................................. 173

A. Alternative Considered with Different Sales Percentage Requirements Than the

Proposal ............................................................................................................................. 174

1. Description of Alternatives ......................................................................................... 174

2. Total Manufacturer Costs for Alternatives ................................................................. 175

3. Emission Benefits for the Alternatives ........................................................................ 176

4. Health Benefits ........................................................................................................... 177

5. Monetized Health Benefits for Alternatives and Social Cost of Carbon for Alternatives

....................................................................................................................................... 177

6. Reason for Rejection for Alternatives ......................................................................... 180

B. Small Business Alternative .......................................................................................... 180

C. Performance Standards in Place of Prescriptive Standards ........................................ 180

D. Health and Safety Code section 57005 Major Regulation Alternatives...................... 181

XII. Justification for Adoption of Regulations Different from Federal Regulations Contained in

the Code of Federal Regulations .......................................................................................... 181

XIII. Public Process for Development of the Proposed Action .............................................. 183

XIV. Next Steps ..................................................................................................................... 185

XV. References ...................................................................................................................... 186

Executive Summary

The Advanced Clean Cars II (ACC II) regulatory proposal will drive the sales of zero emission

vehicles (ZEV) to 100-percent ZEVs in California by the 2035 model year, including battery

electric vehicles (BEV) and hydrogen fuel cell electric vehicles (FCEV) and the cleanest-

possible plug-in hybrid-electric vehicles (PHEV), while reducing smog-forming emissions from

new internal combustion engine vehicles (ICEVs). Additionally, the proposed charging and

ZEV assurance measures, which include proposals to set minimum warranty and durability

requirements, increase serviceability, and facilitate battery labeling, will help ensure

consumers can successfully replace their ICEVs within California households with new or used

ZEVs and PHEVs that meet their needs for transportation and protect the emission benefits

of the program. These standards will also reduce the total cost of ownership for passenger

cars and light trucks, saving drivers money in the long term and further promoting consumer

adoption.

ACC II is critical to meeting California’s public health and climate goals and meeting State

and federal air quality standards. Mobile sources are the greatest contributor to emissions of

criteria pollutants

and greenhouse gases (GHG) in California, accounting for about 80-

percent of ozone precursor emissions and approximately 50-percent of statewide GHG

emissions, when accounting for transportation fuel production and delivery.

The National

Ambient Air Quality Standards (NAAQS) for two of these criteria pollutants—ozone

(sometimes referred to as smog) and fine particulate matter (PM2.5, sometimes referred to

as soot)—are particularly relevant in California. California suffers some of the worst air

pollution in the nation. The South Coast and San Joaquin Valley air basins are the only two

regions in the country classified as ‘Extreme’—the worst category—for nonattainment of the

federal ozone standard of 70 parts per billion (ppb). These areas also suffer some of the

worst levels of PM2.5 pollution. This proposal is an integral part of California’s strategy to

address these pressing public health needs, in compliance with state and federal law.

Emissions from motor vehicle engines hurt public health, welfare, the environment, and the

climate in multiple interrelated ways. Reducing emissions of one kind supports reducing

emissions of others and contributes to decreasing the severity of their impacts, as discussed

below.

In particular, as the climate warms, ozone becomes harder to control and more

particulate matter is released from wildfires. Reducing the emissions that cause climate

change will lead to greater reductions in ozone from the efforts to reduce the pollutants that

cause it, which are primarily oxides of nitrogen (NOx) and hydrocarbons (HC) from fuel

combustion. These emission reductions will help stabilize the climate and reduce the risk of

severe drought and wildfire and its consequent fine particulate matter pollution.

The federal Clean Air Act, 42 U.S.C. §7401, et seq., requires the United States Environmental Protection

Agency (U.S. EPA) to set National Ambient Air Quality Standards (NAAQS) for six “criteria” pollutants. The

Clean Air Act also requires states to develop and enforce implementation plans for “nonattainment” areas, i.e.,

areas of the State that do not meet the NAAQS or contribute to a nearby area that does not meet the NAAQS.

Nonattainment areas have air pollution surpassing levels the federal government has deemed requisite to

protect public health and the environment

CARB 2021a. 2020 Mobile Source Strategy. Released September 2021.

(https://ww2.arb.ca.gov/sites/default/files/2021-09/Proposed_2020_Mobile_Source_Strategy.pdf, accessed

January 31, 2022)

Infra, Chapter II.A.

The emission reductions from the ACC II proposal are critical to achieving carbon neutrality

by 2045, an essential target established by the Governor’s Executive Order B-55-18

, and

being evaluated in the draft 2022 Scoping Plan Update, which is set to be heard by the

Board in June 2022. The 2022 State Strategy for the State Implementation Plan (SIP)

Strategy also relies on reducing emissions of oxides of nitrogen (NOx) from passenger

vehicles to attain the latest federal ambient ozone standards by 2037 in the South Coast

(as

has been further emphasized in previously adopted SIPs). Moreover, communities burdened

by transportation pollution throughout the state, including near-roadway communities, will

benefit from declines in pollution at the local level.

California’s Long History of Emission Regulations

The proposal builds upon the California Air Resources Board’s (CARB or the Board) long

history of controlling emissions from mobile sources. Over 30 years ago, the Board

established the Low-Emission Vehicle (LEV) regulation, which contained aggressive exhaust

emission regulations for light-duty passenger cars and trucks and the first requirement for

manufacturers to build ZEVs.

In 2004, following the adoption of Assembly Bill (AB) 1493,

(Pavley, Chapter 200, Statutes of 2002), CARB approved a landmark greenhouse gas (GHG)

exhaust standard, more commonly known as “the Pavley regulation” for the statute’s author,

to require automakers to control GHG emissions from new passenger vehicles beginning with

the 2009 model year. These were the first regulations in the nation to control greenhouse gas

emissions from motor vehicles, one of the largest contributors to climate change emissions in

the state.

Continuing its leadership role in developing innovative and groundbreaking emission control

programs and advancing ZEV technologies, California developed the Advanced Clean Cars

(ACC) program, which the Board finalized in 2012. The ACC program incorporated three

elements that combined the control of smog-causing pollutants and GHG emissions into a

single coordinated package of requirements for model years 2015 through 2025, assuring

the development of environmentally superior vehicles that will continue to deliver the

performance, utility, and safety vehicle owners have come to expect. These three elements

included the LEV III regulations to reduce criteria pollutants and GHG emissions and another

phase of ZEV requirements.

When the Board adopted ACC in 2012, it committed to conducting a comprehensive

midterm review (MTR) of three elements within the ACC program. At completion of the

MTR, the Board concluded the following, among other things, at its March 2017 hearing:

• California’s GHG tailpipe standards remain appropriate and achievable for the 2022

through 2025 model years;

• California’s ZEV requirements as adopted in 2012 are appropriate and will remain in

place to develop the market;

GO 2018. Governor Jerry Brown. Executive Order B-55-18. https://www.ca.gov/archive/gov39/wp-

content/uploads/2018/09/9.10.18-Executive-Order.pdf September 2018. Accessed March 7, 2022.

CARB 2022a. California Air Resources Board. 2022. “Draft 2022 State Strategy for the State Implementation

Plan.” Released January 31, 2022. Accessed February 1, 2022. https://ww2.arb.ca.gov/sites/default/files/2022-

01/Draft_2022_State_SIP_Strategy.pdf.

Although the Clean Fuels Outlet regulation update was adopted by the Board as part of the ACC package, it

was not finalized in response to Assembly Bill 8 (AB 8, stats. 2013, ch. 401), which included dedicated funding

for hydrogen fueling infrastructure to support the market launch of FCEVs.

• Complementary policies are needed and should be expanded to help support an

expanding ZEV market;

• California’s particulate matter (PM) standard is feasible but further action is needed to

ensure robust control; and

• Staff are directed to immediately begin rule development for more stringent standards

for the 2026 and subsequent model years.

Following the Board’s direction in 2017, staff developed these proposed ACC II regulations.

The proposals go beyond the existing State and federal GHG emission standards, which have

been adopted by CARB and the U.S. Environmental Protection Agency (EPA), respectively,

and which will remain in effect

. Staff’s proposal aims to further curb criteria, toxic, and GHG

emissions by increasing stringency of emission standards for ICEVs, ensuring emissions are

reduced under real-world operating conditions, and accelerating the transition to ZEVs

beginning with the 2026 model year through both increased stringency of ZEV sales

requirements and associated requirements to support wide-scale adoption and use.

Considering Equity in Advanced Clean Cars

Improving access to clean transportation and mobility options for low-income households

and communities most impacted by pollution supports equity and environmental justice and

is key in achieving emission reductions.

CARB’s statewide strategy to address these goals,

known as the Community Air Protection Program Blueprint, identifies ACC II in helping to

reduce exposure to criteria pollution and toxic air contaminants in burdened communities.

The significant pollution reductions from the proposal as a whole, when accounting for

cleaner ICEVs as well as ZEVs, will reduce exposure to vehicle pollution in communities

throughout California, including in low-income and disadvantaged communities that are

often disproportionately exposed to vehicular pollution.

Further, the proposed ZEV

assurance measures, discussed in Chapter III.D., will ensure these emissions benefits are

realized and long-lasting, while supporting more reliable ZEVs in the used vehicle market,

where the cost of ZEVs become more affordable to lower-income households. Staff have also

proposed provisions, discussed in Chapter IX, to encourage manufacturers to take actions

that improve access to ZEVs for disadvantaged, low-income, and other frontline

communities, including by investing in community car share programs, producing affordable

ZEVs, and keeping used vehicles in California to support CARB’s complementary equity

incentive programs.

A Growing ZEV Market

At the time of ACC adoption in 2012, there were less than 5 ZEV and PHEV models available

for sale in California. By the end of 2021, California had 60 ZEV and PHEV models in the

CARB 2017a, Advanced Clean Cars, Midterm Review, Reso. 17-3, May 24, 2017, Advanced Clean Cars

Midterm Review - Resolution 17-3.

CARB will continue to work closely with its federal agency partners as it considers whether to revise its GHG

exhaust emission standards in a future proposal

Infra., Chapter II.B.

Infra., Chapter IX; see also Apte 2019. Apte, Joshua S, Sarah E Chambliss, Christopher W Tessum, and Julian

D Marshall. 2019. A Method to Prioritize Sources for Reducing High PM2.5 Exposures in Environmental Justice

Communities in California. CARB Contract Number 17RD006. Accessed February 25, 2022.

https://ww2.arb.ca.gov/sites/default/files/classic/research/apr/past/17rd006.pdf.

market and had surpassed 1 million cumulative ZEVs and PHEVs sold, leading the United

States (US) in ZEV sales. Over this time, many factors helped in transforming the

transportation sector to cleaner technologies. Legal requirements in California, primarily

CARB’s ACC program, and international regulations, have required manufacturers to invest in

developing zero-emission technology. Those investments have improved ZEV technology to

meet a broader array of driver needs and complementary programs, and the associated

expansion of public infrastructure, that has driven consumer demand.

The industry has rapidly responded to evolving market pressures, consumer demands, and

regulatory requirements in California, across the United States, and around the globe.

Overall, these improvements have reduced costs for batteries, the main driver of BEV and

PHEV costs, as well as for non-battery components. This has enabled manufacturers to

accelerate plans to bring to market more long-range ZEVs in more market segments and

highly capable PHEVs. Today, every manufacturer has a public commitment to significant if

not full electrification in the next 20 years. Based on public announcements, it is expected

that nearly 120 ZEV and PHEV models will be available to consumers before the 2026 model

year.

In California, 74-percent of drivers report having at least some interest in the electric vehicle

market, and 40-percent considering going electric for their “next vehicle.”

This interest is

turning into growing sales, with new vehicle market share of electric drive vehicles in 2021

jumping to 12.4-percent from 7.8-percent just the year prior in California. Further,

satisfaction is high among electric vehicle owners and is likely to lead to subsequent

purchases of electric vehicle technology.

Over the long term, a transition to technology that does not rely on petroleum fuels will also

reduce costs in addition to mitigating adverse impacts on public health, the environment,

and the climate. US household expenditures on energy consumption have ranged between

4% and 8% of their disposable income, and it has been shown historically that consumers

spend higher shares of their income on energy expenditures when energy prices are higher.

The impact of higher energy prices can be more significant for low-income households, as

they spend larger magnitudes of their disposable income on energy expenditures. Less

dependency on conventional sources of energy, and thus reduced demand for petroleum

fuels, lessens exposure to the global energy market and lowers impacts from volatile gasoline

and diesel prices. It will also reduce attendant costs due to risks to national and global

stability and security from dependency on oil.

The ACC II regulation will not achieve success on its own but is one tool that works in concert

with many other complementary programs and policies that California is undertaking to

support the transition to zero-emission transportation. Sustained California policy signals and

Consumer Reports 2021. Consumer Reports. “Consumer Attitudes Towards Electric Vehicles and Fuel

Efficiency in California: 2020 Survey Results”, Published March 2021.

EIA 2014. U.S. Energy Information Administration. 2014. “Today in Energy: Consumer Energy Expenditures

are Roughly 5% of Disposable Income, Below Long-Term Average.” October 21, 2014. Accessed March 18,

2022. https://www.eia.gov/todayinenergy/detail.php?id=18471.

For example, U.S. EPA has cited estimates that the U.S. military spends $81 billion per year protecting global

energy supplies. EPA 2021a. U.S. Environmental Protection Agency, Revised 2023 and Later Model Year Light

Duty Vehicle GHG Emissions Standards: Regulatory Impact Analysis, EPA-420-R-21-028, December 2021, p. 3-

24, https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P1013ORN.pdf.

regulations, backed by significant financial investment in a suite of complementary policies

have been critical to accelerating demand. Since the adoption of ACC, network planning for

better placement of charging and hydrogen infrastructure has developed, along with

increased funding for these fueling stations. Public investment and regulations are working to

address barriers in support of this proposed vehicle regulation.

The Evolution of Advanced Clean Cars II

Consistent with the Board’s long-standing practice, staff have engaged in an extensive public

process in developing the Proposed Regulation, holding four public workshops in 2020 and

2021, culminating in a pre-draft regulatory proposal released in December 2021. As

discussed in Chapter XIII, the proposal reflects extensive feedback received throughout this

process.

The proposed regulations are also founded on significant positive developments in the

market. Every light-duty vehicle manufacturer has made commitments to electrify their

product line in a significant way.

Confidential manufacturer projections received mid-2021

confirmed these announcements, building confidence in a strong near-term market for ZEVs

and PHEVs. Furthermore, subsequent to CARB’s public workshops on its initial proposals in

2021, U.S. EPA finalized its rulemaking for 2023 through 2026 model year light-duty vehicle

greenhouse gas emission standards.

Its rulemaking analysis showed a minimum compliance

path that would result in 17-percent of new vehicle sales being ZEVs and PHEVs by the 2026

model year nationally.

These factors, in combination with adjustments to ZEV and PHEV costs since the release of

the Draft Standardized Regulatory Impact Analysis (SRIA), meant that staff was able to

strengthen its proposal for the early years of the regulation relative to earlier regulatory

concepts. Specifically, staff was able to leverage more recent analysis from the Argonne

National Laboratory (ANL), and U.S. EPA teardown reports, and additionally added further

detail on delete costs for mechanical all-wheel drive (AWD) components. The net of these

changes has lowered BEV incremental costs throughout all the model years covered by the

proposed rule. The results show that for BEVs, operational savings will offset any incremental

costs over the 10-year period evaluated. For example, a passenger car BEV with a 300-mile

range will have initial annual savings occur in the first year for the 2026 model year

technology. For the 2035 model year technology, the initial savings are nearly immediate

and cumulative savings over ten years exceed $7,500. For a more detailed discuss of these

costs and analyses, see Chapter X and Appendices G (ACC II ZEV Technology Assessment),

and H, (ACC II LEV Technology Appendix).

Additionally, staff further bolstered the proposal since the SRIA in the area of equity and

environmental justice (EJ), already a multi-faceted effort in ACC II, and one that sits within a

larger set of actions – from incentive programs to other regulatory measures – intended to

protect priority populations. Following continued input from external stakeholders and

internal equity partners, staff are proposing to add a third category to increase affordable

access to ZEVs and PHEVs by providing an incentive for manufacturers to offer lower priced

A list of all manufacturer announcements can be found in Appendix G.

EPA 2021b. U.S. Environmental Protection Agency, “Revised 2023 and Later Model Year Light-Duty Vehicle

GHG Emissions Standards.” Federal Register 86, no. 248 (December 30, 2021): 74434.

https://www.govinfo.gov/content/pkg/FR-2021-12-30/pdf/2021-27854.pdf.

vehicles. This is especially important in the earlier years of the proposed ACC II program

when battery costs are higher. The EJ vehicle values are aimed at providing manufacturers

with incentive for targeted actions that would help achieve more equitable outcomes.

Summary of ZEV Regulation Proposal

As discussed in Chapter III, below, CARB staff proposes an annual ZEV requirement that

aligns with where the market is expected to be in 2026, and that continues to ramp up

quickly to nearly 70% of new vehicles sales by 2030. Staff’s proposed ZEV stringency is

shown below in ES – Figure 1.

ES - Figure 1:Proposed Annual ZEV Requirement

The ZEV regulation proposal reflects a balance of stringent annual ZEV requirements,

minimum technology requirements, and appropriate flexibilities that will put California, and

the states that choose to adopt California’s ZEV regulation,

on a path to 100%

electrification by the 2035 model year. Below is a table summarizing staff’s ZEV regulation

proposals.

Table ES-0-1: Summary of ZEV Proposals

Proposal Category Description of Proposal

ZEV minimum

requirements

150-mile label range, propulsion-related parts warranty,

battery warranty, data standardization, charging cord, battery

label, service information

Other states may adopt California’s engine and motor vehicle emission standards under Section 177 of the

Clean Air Act, 42 U.S.C. § 7507. See listing of states in Section III.C.2.d).

PHEV

minimum requirements

50-mile label range, 40-mile US06 range, SULEV, 15-

year emissions warranty, battery warranty, charging cord,

battery label

ZEV and PHEV Vehicle

Values and Life

Counted as One Vehicle Value, 5-year value life

PHEV Phase in 2026-2028 30-mile label range, partial vehicle value

PHEV Cap 20% of annual requirement

Environmental Justice (EJ)

Vehicle Values

5% of annual requirement through 2031 MY

1. 0.5 value for ZEVs and 0.4 value for 6-passenger PHEVs

offered at 25% price discount to car share community

programs

2. 0.1 value for off-lease (<$40k MSRP) ZEV and PHEVs

delivered to CC4A and CVAP dealers

3. 0.1 value for low MSRP ZEVs and PHEVs (<$20k Cars, <

$27K Trucks)

Early Compliance Values 15% of annual requirement through 2028 MY

OEMs with >20% EV market share in 2024 and 2025 can

generate ACC II credits early

Historical Credit Treatment

(ACC I)

2025 MY Balance / 4 = Converted ZEV Values

2025 MY Balance / 1.1 = Converted PHEV Values

Converted ZEV and PHEV

Values

15% of annual requirement (if shortfall) through 2030 MY

Pooling

Excess values can count toward compliance, up to 25%

(2026) down to 5% (2030) of annual requirement (if shortfall)

in CA or Section 177

Allowed Deficit Can carry forward deficit for 3 years

Small Volume

Manufacturers (SVM)

Must comply 2035+ MYs

CC4A stands for Clean Cars For All, and CVAP stands for Clean Vehicle Assistance Program.

Summary of ZEV Assurance Measure Proposals

The ACC II proposal is intended to fulfill requirements and goals to reduce air pollution,

protect public health, and stabilize the climate. The long-term success of these emission

reductions depends on ZEVs and PHEVs permanently displacing all new conventional internal

combustion gasoline and diesel engine passenger vehicle sales in California by 2035 and

sustaining consumer use of these vehicles over their full useful lives to permanently eliminate

conventional vehicles’ emissions. This means that the ZEV fleet is critical to pollution control,

and if ZEVs fail to meet the drivers’ needs, a ZEV may be replaced with a new or used

conventional vehicle – a concern that has been observed in ZEV discontinuance and that

intensifies as ZEVs age and compete on the used vehicle market. CARB has long designed its

regulations and certification systems to ensure that vehicles, including their emission

controls, perform properly throughout their life. It is similarly necessary to ensure both that

ZEVs function as expected over their lifetimes and that consumers are not deterred from

purchasing them both new and used. In the ZEV regulation context, this proposal continues

that approach. To secure the emission benefits of this proposal, ZEVs must meet continuing

assurance requirements throughout their lives. Below is a summary of staff’s ZEV assurance

proposals.

Table ES-0-2 Summary of ZEV Assurance Proposals

Proposal Description Applicable Vehicles for

2026 MY, unless noted

Data Standardization

Required data parameters,

including battery state of

health

ZEVs and PHEVs*

Durability

80% of Certified Range

Value for 10 years / 150,000

miles

ZEVs and PHEVs*

Propulsion-Related Parts

Warranty

3 years / 50,000 miles

7 years / 70,000 miles for

high priced parts

ZEVs and PHEVs*

Battery Warranty

8 years / 100,000 miles, 70%

or 75% Battery State of

Health

ZEVs and PHEVs

Service Information

Disclose repair information

to independent repair shops

ZEVs (2011 MY+) and

PHEVs*

Battery Labeling

Label all traction batteries

for recyclability and

repurposing

ZEVs, PHEVs, hybrid electric

vehicles (HEVs), and 48V

HEVs

*PHEVs are proposed to be required to comply with staff’s battery state of health standardization and charge

rate requirements, both of which must be accessible to the driver. PHEV are already required to comply with (1)

California Code of Regulations (CCR), title 13, section 1968.2 (On-Board Diagnostics), which covers most other

data metrics proposed for ZEVs, (2) CCR, Title 13, sections 1961.2 and 1961.4 which requires vehicles to meet

GHG and criteria exhaust emission standards over useful life (15 years or 150,000 miles, (3) CCR, title 13, section

2037 ad 2038, which requires emissions related parts warranty coverage for PHEVs, and (4) CCR, title 13,

section 1969, which requires the disclosure of service information.

Summary of LEV Criteria Proposals

The suite of proposed regulations, discussed in Chapter IV, below, guide the light-duty

vehicle segment toward 100-percent electrification by 2035, signifying that the last new

conventional ICEV will be sold in California during the implementation period of this

regulation. However, these ICEVs will remain in use on California’s roads well beyond 2035,

and PHEVs that include combustion engines will continue to be sold and used after 2035. As

such, the proposed regulation includes three primary elements aimed to mitigate the air

quality impacts of ICEVs. First, it would prevent potential emission backsliding of ICEVs that

is possible under the existing regulations by applying the exhaust and evaporative emission

fleet average standards exclusively to combustion engines. Second, it would lower the

maximum exhaust and evaporative emission rates. Third, it would reduce cold-start

emissions, by applying the emission standards to a broader range of in-use driving

conditions. The combination of these three elements would help deliver real-world emission

benefits from the remaining ICEVs that would complement the significant emission

reductions gained by more widespread deployment of ZEV technology.

For the medium-duty vehicle segment of ICEVs, the proposal would first provide better

emission control over a broader range of in-use driving conditions under the moving average

in-use standard for towing capable vehicles. Second, the proposal would require the fleet to

become cleaner by lowering the current fleet average standard. Third, the proposal would

clean up the highest-emitting vehicles by lowering the maximum emission rate from medium-

duty vehicles.

In addition to these substantive proposals, several conforming changes are proposed to

related regulations to maintain consistency with existing regulations and maintain existing

requirements in regulations that are not being proposed for amendment, including the

existing greenhouse gas emission regulations in California Code of Regulations (CCR), title

13, section 1961.3, that are part of the existing Advanced Clean Cars program. These

conforming amendments are described in Chapter IV, section A.7.

Table ES-0-3 Summary of LEV Proposals for Light-Duty Vehicles

Proposal Category Description of Proposal

NMOG+NOx Fleet

Average

- Maintain NMOG+NOx fleet average at 0.030 g/mile

- Phase-out ZEVs from NMOG+NOx fleet average

Although not covered by the ZEV rulemaking in this regulatory package, the Advanced Clean Trucks

Regulation requires 50 percent electrification by 2035. Title 13, CCR §1963.

- Phase-out NMOG+NOx emission credits given to

PHEVs for electric driving

- Eliminate dirtiest emission certification bins (ULEV125

and LEV160)

- Add new lower emission bins (SULEV15, SULEV25,

ULEV40, ULEV60)

SFTP Emission Standards

- Eliminate composite SFTP certification option

- Require all light-duty vehicles to meet FTP

NMOG+NOx emission levels on the aggressive driving

US06 cycle

- Require attestation that vehicles will meet FTP

NMOG+NOx emission levels on the SC03 cycle

Particulate Matter (PM)

Emission Standards

- Reduce US06 PM emission standard from 6 to 3

mg/mile

Cold-start Emission Control

- Establish new FTP emission standards to improve cold-

start emission control following partial soaks of 10

minutes to 12 hours

- New emission standards to improve cold-start

emission control during quick drive-aways on an 8

second initial idle FTP test.

Plug-in Hybrid Electric

Vehicles

- Establish new cold-start US06 emission certification

test to demonstrate compliance with new high-power

cold-start emission standards

Evaporative Emission

Control

- Reduce running loss emission standard from 0.05 to

0.01 g/mile to reduce evaporative emissions during

driving.

Table ES-0-4 Summary of LEV Proposals for Medium-Duty Vehicles

Proposal Category Description of Proposal

NMOG+NOx Fleet

Average

- Reduce fleet average to 150 mg/mile for class 2b and

175 mg/mile for class 3

- Remove ZEVs from the fleet average calculation

- Eliminate dirtiest emission certification bins for class

2b (ULEV250, ULEV200) and class 3 (ULEV400,

ULEV270)

- Add new lower emission certification bins for class 2b

(SULEV150, SULEV100, SULEV85, SULEV75) and for

class 3 (SULEV175, SULEV150, SULEV125, SULEV100).

SFTP Emission Standards

- Eliminate composite SFTP certification standards

- Require all Class 2b MDVs to meet FTP NMOG+NOx

emission levels on the US06 cycle

- Require all Class 3 MDVs to meet FTP NMOG+NOx

emission levels on the UC cycle

- Require attestation that SC03 emissions will be lower

than FTP certification bin standard

Particulate Matter (PM)

Emission Standards

- Eliminate composite SFTP certification option

- Require all medium-duty vehicles to meet stand-alone

PM standards for aggressive driving cycles: 8 mg/mile

for class 2b on full US06 cycle, 6 mg/mile for class 2b

on bag 2 US06 cycle, and 5 mg/mile for class 3 on UC

cycle

Moving Average Window

In-Use Standards

- Establish new PEMS standards for MDVs over 14,000

pound Gross Combined Weight Rating for better

emission control during towing

Proposal Direct Costs and Savings

Chapter X and the SRIA, discuss the economic and fiscal impacts of the ACC II proposed

regulations. The primary businesses affected by the Proposed Regulation are manufacturers

that sell on-road light-duty vehicles in the State of California. At this time, there are 17

companies that would be subject to this regulation. Also indirectly affected are California

consumers who buy new vehicles, and eventually used vehicle buyers. The cost to

manufacturers will be high per vehicle in the early years, but significantly decrease over time

by 2035. Between 2026 and 2040, the Proposed Regulation is estimated to result in

additional costs to businesses of $30.2 billion, or $2.0 billion on average per year.

In 2040, the proposed regulations are estimated to result in job gains of approximately

24,900, primarily in services, manufacturing and constructions sectors and approximately

64,700 jobs foregone predominantly in the retail and government sectors (though many of

the government sector jobs are tied to projected reductions in gas tax revenues which the

state is making separate efforts, outside of this proposal, to mitigate by considering other

revenue measures recognizing that gasoline vehicles will become rare; accordingly not all of

those losses may occur). The net job impact of the Proposed Amendments in 2040 is

estimated to be a slowing of employment growth of approximately 39,800 jobs. Overall jobs

and output impacts of the proposed regulation are small relative to the total California

economy, representing changes of no greater than 0.4 percent. Additionally, the regulations

will reduce the overall costs for transportation in California. Between 2026 and 2040, the

total impact is estimated to be a net cost-savings of $81.8 billion, or $5.9 billion on average

per year.

Individual vehicle consumers, for most ZEVs in the program, will see cost-savings when

considering the total cost of ownership (TCO). The results show that for BEVs, operational

savings will offset any incremental costs over the 10-year period evaluated. For example, a

passenger car BEV with a 300-mile range will have initial annual savings occur in the first year

for the 2026 model year technology. For the 2035 model year technology, the initial savings

are nearly immediate and cumulative savings over ten years exceed $7,500. These TCO

savings are even more favorable for a BEV owner who has access to a home charger.

Proposal Net Benefits

As discussed in Chapter XI and Appendix D, Emissions Inventory Methods and Results for the

Proposed Amendments, the ACC II program would increase new vehicle sales of BEVs,

FCEVs, and PHEVs and reduce emissions from the remaining new ICEVs sold. Increased use

of ZEVs penetrating the California fleet will reduce vehicle as well as upstream fuel

production emissions of GHGs, criteria pollutants (especially hydrocarbons or HC, oxides of

nitrogen or NOx, and fine particulate matter, or PM2.5), and toxics. Through the proposed

regulation, California will see a reduction in 2040 of 30.1 tons per day of NO

, 2.0 tons per

day of PM

2.5

, and 57.4 MMT/yr of CO

emissions (well-to-wheels emissions accounting for fuel

production) in 2040. The proposal will lead to an estimated 1,272 fewer cardiopulmonary

deaths; 208 fewer hospital admissions for cardiovascular illness; 249 fewer hospital

admissions for respiratory illness; and 639 fewer emergency room visits for asthma.

The proposed regulation is expected to significantly reduce GHG emission by replacing

ICEVs with ZEV technologies. The benefit of these GHG emission reductions can be

estimated using the social cost of carbon (SC-CO

), which provides a dollar valuation of the

damages caused by one ton of carbon pollution and represents the monetary benefit today

of reducing carbon emissions in the future. The avoided SC-CO

from 2026 to 2040 is the

sum of the annual well-to-tank (WTT)

and tank-to-wheel (TTW) GHG emissions reductions

multiplied by the SC-CO

in each year. The cumulative well-to-wheel (WTW) GHG emissions

reductions along with the estimated benefits range from about $10.9 billion to $46.0 billion

through 2040, depending on the chosen discount rate. The net result of these analyses shows

the proposed regulation delivers a cumulative net benefit to California of $80.7 billion and

has a benefit-cost ratio of 1.38, meaning benefits are more than costs between 2026 and

2040.

Table ES-0-5 Summary Costs and Benefits

Cumulative Costs, Benefits, and Job Impacts in 2040

Total costs to businesses:

$30.2 billion

The net job impact: decrease

in employment growth of

39,800 jobs

The total impact is a net cost-

savings of $81.8 billion

Connections between demand reductions for fuels and supply impacts are complex; as discussed in prior

documents for this regulation, including its SRIA, WTT estimates reflect one plausible scenario. Supply

decisions and upstream programs beyond the scope of this regulation may vary WTT figures, though overall

benefits from WTW emissions remain very large in all scenarios.

Total Cost of Operation Savings to Individuals

Overall, between 2026 and

2040, the TCO is estimated to

be a net cost savings,

statewide, of $81.8 billion

For the 2026 model year a

passenger car BEV with a 300-

mile range will have initial

annual savings occur in the first

year.

For the 2035 model year

technology, the initial savings

are nearly immediate and

cumulative savings over ten

years exceed $7,500.

Total Emission Benefits in 2040

(well-to-wheel emissions accounting for fuel production)

NOx (tpd) 30.1 PM

2.5

(tpd) 2.0 CO

(MMT/yr) 57.4

Estimated Cumulative Mortality Benefits 2026 - 2040 Statewide

1,272 fewer cardiopulmonary deaths;

208 fewer hospital admissions for cardiovascular illness;

249 fewer hospital admissions for respiratory illness; and

639 fewer emergency room visits for asthma

As shown in this staff report and accompanying analyses, the cost of the state regulations is

justified by the benefit to human health, public welfare, and the environment. The proposed

regulations will provide significant benefits for all these factors. They will reduce emissions

harmful to human health and the environment. These emission reductions will improve the

public health and welfare and protect the environment and climate for all Californians.

California Continues Advancing Clean Cars

In adopting staff’s proposal, the Board will put California will lead the nation in advancing

clean cars to the ultimate goal of 100% zero emissions, all while reducing smog-forming

emissions from new ICEVs. Additionally, staff’s ZEV assurance measures proposal includes an

innovative approach to helping ensure consumers can successfully replace their ICEVs with

new or used ZEVs that meet their needs for transportation with far fewer harmful emissions

and protect the emission benefits of the program. With Californians still experiencing the

harmful effects of smog-forming emissions and the effects of climate change, which are

expected to worsen in the coming decades, adoption of the proposed ACC II regulation is

critical and necessary.

Staff Report: Initial Statement of Reasons

Date of Release: April 12, 2022

Date of Hearing: June 9, 2022

I. Introduction and Background

California has a long history of regulating tailpipe emissions from passenger cars and trucks,

dating to the 1960s. Among the many high watermarks of these programs, in 1990 CARB

adopted an ambitious program to significantly reduce the environmental impact of light-duty

vehicles through the introduction of the Low-Emission Vehicle (LEV) regulations. The

regulations, referred to as the “LEV I” regulations, included three primary elements — (1)

tiers of exhaust emission standards for increasingly more stringent categories of low-emission

vehicles, (2) a mechanism requiring each manufacturer to phase in a progressively cleaner mix

of vehicles from year to year with the option of credit trading, and (3) a requirement that a

specified percentage of passenger cars and light-duty trucks be zero-emission vehicles (ZEV),

vehicles with no exhaust emissions. In 2012, CARB combined LEV regulations for controlling

smog-causing pollutants and greenhouse gas (GHG) emissions with ZEV regulations requiring

the manufacture of ZEVs into what is now referred to as the Advanced Clean Cars (ACC)

program for model years 2015 and beyond. CARB will continue the success of this approach

with this proposal, Advanced Clean Cars II.

The Advanced Clean Cars II (ACC II) regulatory proposal expands the existing requirements

to transition to ZEVs for almost all new car and light truck sales in California while cleaning up

any internal combustion-powered passenger vehicles that will continue to be offered for sale.

Doing so is critical to meeting California’s public health and climate goals and meeting State

and federal air quality standards. Mobile sources are the greatest contributor to emissions of

criteria pollutants and GHGs in California, accounting for about 80 percent of ozone

precursor emissions and approximately 50 percent of statewide GHG emissions, when

accounting for transportation fuel production and delivery.

The emission reductions from

the ACC II proposal will be critical to achieving carbon neutrality by 2045 a goal which CARB

continues to define via the draft 2022 Scoping Plan Update, which is set to be heard for the

first time by the Board in June 2022. The draft 2022 State Strategy for the State

Implementation Plan (SIP) Strategy also relies on reducing emissions of oxides of nitrogen

(NOx) from passenger vehicles to attain the latest federal ambient ozone standards by 2037

in the South Coast,

and reductions from these vehicles are critical to attaining or

maintaining compliance with federal standards as a general matter.

Internal combustion engine vehicles (ICEV), the majority of which are fueled by petroleum-

based fuels, are the dominant type of passenger car and trucks sold in California today, and

will continue to be through the first years of Advanced Clean Cars II. ZEVs, most commonly

battery electric vehicles (BEV) and hydrogen fuel cell electric vehicles (FCEV), have no

exhaust (or tailpipe) emissions and therefore are a clear solution to several public health and

environmental threats. ZEVs reduce mobile source emissions that contribute to unhealthy

CARB 2021a. 2020 Mobile Source Strategy. Released September 2021.

(https://ww2.arb.ca.gov/sites/default/files/2021-09/Proposed_2020_Mobile_Source_Strategy.pdf, accessed

January 31, 2022)

CARB 2022a. “Draft 2022 State Strategy for the State Implementation Plan”

regional ozone and particulate matter levels and reduce local exposure to toxics. ZEVs also

reduce demand for petroleum production, delivery, and combustion that is destabilizing the

climate and directly impacting public health. While ZEVs do still have upstream emissions

that are associated with the production of the electricity and hydrogen used to fuel them

(which are accounted for in the analysis of this proposal), the criteria pollutants and carbon

intensity of transportation electricity and hydrogen are already cleaner than gasoline in

California and are aggressively becoming even cleaner under state laws mandating

renewable sources of fuel and energy production along with CARB’s upstream regulatory

programs.

The proposed regulation will drive the sales of ZEVs and the cleanest-possible plug-in hybrid-

electric vehicles (PHEV) to 100-percent in California by the 2035 model year, all while

reducing smog-forming emissions from new ICEVs. Additionally, the proposed charging and

ZEV assurance measures, which include proposals to set minimum warranty requirements,

durability requirements, increase serviceability, and streamline battery labeling, will help

ensure consumers can successfully replace their ICEVs within California households with new

or used vehicles that meet their needs for transportation with far fewer harmful emissions

and protect the emission benefits of the program.

A. Regulatory History

Staff’s proposal builds upon many decades of CARB regulations seeking to reduce emissions

from light-duty passenger cars and trucks. Each of those regulations ultimately yielded

significant public benefits.

In 1990, CARB established the LEV regulation which contained aggressive exhaust emission

regulations for light-duty passenger cars and trucks and the first requirement for

manufacturers to build ZEVs.

Building upon the success of the LEV regulation, CARB adopted

the second phase of the regulations. These amendments, known as LEV II, set more stringent

fleet average non-methane organic gas (NMOG) requirements for model years 2004 through

2010 for passenger cars and light-duty trucks. Separately, in 2004 following the adoption of a

new state law (Assembly Bill (AB) 1493, statutes of 2002, chapter 200, Pavley), CARB

approved a landmark greenhouse gas (GHG) tailpipe standard, more commonly known as

“the Pavley regulation” for the statute’s author, to require automakers to control GHG

emissions from new passenger vehicles beginning with the 2009 model year. These were the

first regulations in the nation to control greenhouse gas emissions from motor vehicles, one

of the largest contributors to climate change emissions in the state.

The ZEV regulation has been adjusted numerous times since its 1990 inception to account for

changes in market response and technology development. Through this time, manufacturers

continued to develop technology and test pilot vehicles in limited use applications. In 2009,

staff concluded that even widespread market adoption of advanced conventional

technologies, like non-plug-in hybrid-electric vehicles (HEV), would be inadequate to meet

California’s then-current 2050 GHG targets

of reducing emissions by 80-percent below

1990 levels. Staff determined that ZEVs would need to comprise nearly 100-percent of new

vehicle sales between 2040 and 2050, and broad commercial markets for ZEVs would need

CARB, 2009a. “White Paper: Summary of Staff’s Preliminary Assessment of the Need for Revisions to the Zero

Emission Vehicle Regulation”. (PDF)

to launch in the 2015 to 2020 timeframe. The Board heard staff’s findings at its December

2009 hearing and adopted Resolution 09-66,

reaffirming its commitment to meeting

California’s long-term air quality and climate change reduction goals through

commercialization of ZEV technologies.

Continuing its leadership role in the development of innovative and groundbreaking emission

control programs and advancing ZEV technologies, California developed the ACC program,

which was finalized with Board action in 2012. The ACC program incorporated three

elements that combined the control of smog-causing pollutants and GHG emissions into a

single coordinated package of requirements for model years 2015 through 2025, assuring

the development of environmentally superior vehicles that will continue to deliver the

performance, utility, and safety vehicle owners have come to expect. These three elements

included the LEV III regulations to reduce criteria pollutants and GHG emissions and another

phase of ZEV requirements.

When the Board adopted ACC in 2012, it committed to conducting a comprehensive

midterm review (MTR) of three elements within the ACC program: 1) the ZEV regulation, 2)

the 1 milligram per mile particulate matter (PM) standard, and 3) the light-duty vehicle GHG

standards for 2022 and later model years. Staff’s ACC review was conducted at the same

time as staff also participated in a related midterm evaluation by the United States

Environmental Protection Agency (U.S. EPA) of the federal light-duty vehicle greenhouse gas

standards for the 2022 through 2025 model years. Following completion of the MTR, the

Board concluded the following, among other things, at its March 2017 hearing:

• California’s GHG tailpipe standards remained appropriate and achievable for the 2022

through 2025 model years

• California’s ZEV requirements as adopted in 2012 are appropriate and will remain in

place to develop the market

• Complementary policies are needed and should be expanded to help support an

expanding ZEV market

• California’s PM standard is feasible but further action is needed to ensure robust

control

• Staff are directed to immediately begin rule development for more stringent standards

for the 2026 and subsequent model years

The federal program was subsequently significantly modified under successive federal

administrations, with the latest standards becoming effective on February 28, 2022.

CARB’s

work, however, continued in response to the findings of the 2017 MTR. Following the

Board’s direction in 2017, staff developed the proposed ACC II regulations. CARBs efforts

have been accelerated by the growing magnitude of the climate and air quality crisis, and by

CARB 2009b. Resolution 09-66. December 9, 2009. (https://www.arb.ca.gov/board/res/2009/res09-66.pdf,

accessed on January 31, 2022)

Although the Clean Fuels Outlet regulation update was adopted by the Board as part of the ACC package, it

was not finalized in response to Assembly Bill 8 (AB 8, stats. 2013, ch. 401), which included dedicated funding

for hydrogen fueling infrastructure to support the market launch of FCEVs.

U.S. EPA, Revised 2023 and Later Model Year Greenhouse Gas Emission Standards, 86 Fed. Reg. 74,434,

Dec. 30, 2021. The federal government also took actions intended to prevent enforcement of certain model

years of CARB’s ACC program under the federal Clean Air Act and other law; those actions have since been

reconsidered and do not bear directly upon ACC II or limit CARB’s ability to propose these regulations.

resulting direction from the Governor. Governor Newsom signed Executive Order N-79-20

establishing a goal that 100 percent of California sales of new passenger car and trucks be

ZEVs by 2035. Staff’s proposal aims to further curb criteria, toxic, and GHG emission

reductions through increased LEV program stringency, requirements to ensure emissions are

reduced under real-world operating conditions, and by accelerating the transition to ZEVs

through both increased stringency of ZEV requirements and associated actions to support

wide-scale adoption and use beginning with the 2026 model year. The proposals go beyond

the existing state and federal GHG emission standards, which have been adopted by CARB

and U.S. EPA, respectively, and which will remain in effect pending any further revision.

The success of emission controls and electrification within the light-duty sector, along with

growing private and public sector support for electrification across the board, has enabled

similar regulations to be adopted in the medium- and heavy-duty sectors. Some medium-

duty vehicles have the option to certify using the light duty regulations or heavy-duty

regulations; therefore, it is important to know the regulatory landscape for this category.

CARB has finalized a comprehensive update to the California emission standards and other

emission-related requirements for heavy-duty engines and vehicles, referred to as the

“Heavy-Duty Omnibus Regulation.”

The Heavy-Duty Omnibus Regulation is aimed at

ensuring real-world emissions performance on the road, not just in the laboratory. In addition

to more stringent criteria pollutant standards for heavy-duty engines, CARB also adopted the

Advanced Clean Trucks (ACT) regulation. The ACT Regulation

will accelerate the market for

zero-emission medium- and heavy-duty vehicles in applications that are well suited for their

use. Medium- and heavy-duty vehicle manufacturers will be required to start producing and

selling a modest number of ZEVs beginning with the 2024 model year with ZEV sales

increasing through the 2030 model year. CARB is also in the process of proposing an

Advanced Clean Fleets (ACF) regulation which will accelerate adoption of ZEV vehicles in

important uses, and which proposes phasing out new combustion vehicles amongst the

vehicle classes it would cover by 2040.

II. The Problem the Proposal is Intended to Address

The California Legislature has directed CARB to “systematically attack the serious problem

caused by motor vehicles [as] the major source of air pollution in many areas of the state.”

GO 2020. Governor Gavin Newsom. Executive Order N-79-20. Released September 23, 2020.

https://www.gov.ca.gov/wp-content/uploads/2020/09/9.23.20-EO-N-79-20-Climate.pdf, accessed January 31,

2022

CARB will continue to work closely with its federal agency partners as it considers whether to revise its GHG

exhaust emission standards in a future proposal

CARB 2020a. Initial Statement of Reasons: Proposed Amendments to the Exhaust Emissions Standards and

Test Procedures for 2024 and Subsequent Model Year Heavy-Duty Engines and Vehicles, Heavy-Duty On-Board

Diagnostic System Requirements, Heavy-Duty In-Use Testing Program, Emissions Warranty Period and Useful

Life Requirements, Emissions Warranty Information and Reporting Requirements, and Corrective Action

Procedures, In-Use Emissions Data Reporting Requirements, and Phase 2 Heavy-Duty Greenhouse Gas

Regulations, and Powertrain Test Procedures. Released June 23, 2020.

(https://ww2.arb.ca.gov/sites/default/files/barcu/regact/2020/hdomnibuslownox/isor.pdf, accessed January 31,

2022)

CARB 2019a. Initial Statement of Reasons: Advanced Clean Trucks Regulation. Released October 22, 2019.

(https://ww2.arb.ca.gov/sites/default/files/barcu/regact/2019/act2019/isor.pdf, accessed January 31, 2022.)

Health and Saf. Code, § 39003.

Air pollution presents multiple threats to public health and welfare, and CARB is mandated to

meet those threats in many ways. CARB is responsible for controlling emissions from

vehicles

, for preparing the state implementation plan required by the federal Clean Air

Act

, and regulating sources of the greenhouse gases that are causing global warming.

California must significantly reduce emissions of ozone and particulate matter on schedules

that are developed to ensure the air we all breath meets National Ambient Air Quality

Standards (NAAQS), set by U.S. EPA, and the California Ambient Air Quality Standards, set

by CARB, that limit pollution to levels necessary to protect public health. The most recent

federal ozone NAAQS standard is a level of 70 parts per billion (ppb), with a required

attainment date in the South Coast Air Basin by 2037. The federal PM requirements also

require action in California for attainment, with a deadline of 2024 for the 35 ug/m3 24-hour

standard and 2025 for the 12 ug/m3 annual standard. In California, NOx is a critical

precursor to ozone and secondary PM formation. Exposure to ozone and fine particulate

matter (PM2.5) is associated with increases in premature death, hospitalizations, visits to

doctors, use of medication, and emergency room visits due to exacerbation of chronic heart

and lung diseases and other adverse health conditions. Accordingly, ZEVs and reduced

emissions from conventional vehicles are a leading measure supporting the State SIP

Strategy.

To evaluate the kinds of strategies necessary, and the pace of action needed, to address the

complex, wide-reaching problem of air pollution from motor vehicles and other mobile

sources, CARB developed the 2020 Mobile Source Strategy.

As with the prior 2016 Mobile

Source Strategy, the updated Strategy informs policy decisions for specific measures in the

State Implementation Plan (SIP) required by the federal Clean Air Act, the Climate Change

Scoping Plan, and Community Emission Reduction Plans to protect vulnerable communities

from disparate pollution impacts. Although feasibility assessments and regulatory stringency

requirements are established in separate rulemakings, the Mobile Source Strategy provides

important context on how to mitigate multiple pollutants when considering all mobile

sources in California as a top-down assessment of the magnitude of change needed to be

achieved across a portfolio of programs. The need to continue reducing pollution from

conventional passenger vehicles while simultaneously scaling up requirements for ZEVs on

California’s roads, including within this regulatory proposal along with other efforts, are

important outcomes of the Mobile Source Strategy and integral to these proposed

regulations.

The State Strategy for the State Implementation Plan provides the framework for meeting

the federal and State health-based ambient air quality standards.

The California Global Warming Solutions Act of 2006, Assembly Bill 32 (Nuñez, Chapter 488,

Statutes of 2006, requires CARB “to achieve the maximum technologically feasible and cost-

effective greenhouse gas emission reductions”

Senate Bill 32 requires CARB to ensure that

Health and Saf. Code, §§ 39002, 39667

Health and Saf. Code, § 39602

Health and Saf. Code, § 38510.

CARB 2021a.

CARB 2017b. CARB Staff Report - Revised Proposed 2016 State Strategy for the State Implementation Plan,

March 2017. https://ww3.arb.ca.gov/planning/sip/2016sip/rev2016statesip.pdf Accessed January 20, 2022.

HSC 38560; see also 38510.

California’s statewide emissions of GHG emissions are reduced to at least 40 percent below

the level of statewide GHG emissions in 1990 by 2030.

In December 2017, CARB adopted

the Scoping Plan Update, known as California’s 2017 Climate Change Scoping Plan, to

provide the strategy to meet California’s 2030 target for reducing GHG emissions.

It too

includes zero-emission passenger cars and light trucks as a key component of the strategy to

meet California’s long-term goals for a sustainable climate and transportation system.

Subsequently, Executive Order B-55-18

established a statewide goal of achieving carbon

neutrality no later than 2045. In support of reducing vehicle emissions, Governor Newsom

signed Executive Order N-79-20

establishing a goal that 100 percent of California sales of

new passenger car and trucks be ZEVs by 2035.

CARB also recognizes that the proposed regulations must have multiple approaches to meet

the complex, multi-dimensional public health, welfare, and climate problem of motor vehicle

pollution. To meet this objective, CARB incorporated numerous market-based flexibilities

and mechanisms into the proposal. These include averaging, banking, and trading provisions

for meeting the emission and ZEV standards.

A. Need for Emission Reductions

Cars, trucks, and other mobile sources contribute a significant amount of smog-forming NOx

(a precursor to ozone formation, sometimes referred to as smog) and the largest portion of

GHG emissions in California.

As shown in the baseline conditions of the updated 2020

Mobile Source Strategy, on-road light-duty vehicles accounted for 13-percent of the total

NOx emissions statewide in 2017. In the South Coast Air Basin specifically, light-duty vehicles

comprised 18 percent of the 2017 NOx emissions inventory. Also as shown in the 2020

Mobile Source Strategy, light-duty vehicles comprise 28 percent of the GHG emissions in

California,

or about 70-percent of the direct emissions from vehicles and equipment. The

indirect or upstream emissions from fuel production (for all transportation modes) are 7-

percent for refineries, 4.1-percent for oil and gas extraction, 0.9-percent for pipelines, and

0.7-percent for agriculture activities to produce fuel. When coupled with the direct emissions

from all transportation sources, the total GHG emissions from mobile sources and their fuel

production represent more than 50-percent of the total statewide GHG inventory. The 2020

Strategy reinforced the conclusions of the 2016 Mobile Source Strategy: transitioning to

zero-emission technology for every on- and off-road mobile sector is essential for meeting

Pavley, ch. 249, stats. 2016; HSC 38566

CARB 2017c. California Air Resources Board. California's 2017 Climate Change Scoping Plan Update.

https://ww2.arb.ca.gov/sites/default/files/classic/cc/scopingplan/scoping_plan_2017.pdf November 2017.

Accessed January 31, 2022.

GO 2018. Governor Jerry Brown. Executive Oder to Achieve Carbon Neutrality, EO B-55-18. Released

September 10, 2018. https://www.ca.gov/archive/gov39/wp-content/uploads/2018/09/9.10.18-Executive-

Order.pdf, accessed January 31, 2022

GO 2020.

CARB 2021a.

CARB 2021a; this remains consistent with the more recent CARB GHG Emission Inventory Report for 2019

emissions. CARB 2021b. California Greenhouse Gas Emissions for 2000 to 2019.

https://ww3.arb.ca.gov/cc/inventory/pubs/reports/2000_2019/ghg_inventory_trends_00-19.pdf

near- and long-term emission reduction goals mandated by statute, with regard to both

ambient air quality and climate requirements.

The Draft 2022 State Strategy for the State Implementation Plan

builds on emission

reductions from the proposed regulations, which are critical to meeting air quality standards.

If the state cannot demonstrate it can attain these standards via enforceable plans it may face

various federal sanctions or regulatory burdens, further heightening this need. It is part of

efforts underway to cut emissions from new combustion vehicles while taking all new vehicle

sales to 100-percent electrification no later than 2035. It is designed to reduce NOx

emissions from today’s light-duty vehicles by up to 90-percent, contributing nearly a third of

the emission reductions committed in the SIP for attainment of the previous 75 ppb ozone air

quality standards that require attainment in 2031. The proposed regulations adopt new

enforceable requirements that will reduce emissions of criteria pollutants. The proposed

regulations will be submitted to U.S. EPA as a revision to the California State Implementation

Plan (SIP) required by the federal Clean Air Act to attain and maintain the National Ambient

Air Quality Standards. Although the regulations will be effective as a matter of state law once

final, upon approval by U.S. EPA as a revision to the SIP, the regulations will also be effective

for purposes of federal law. The regulations also respond to the gathering climate crisis. The

dramatic increase in greenhouse gas emissions from human activity, particularly carbon

dioxide (CO

), over the past several decades is having indisputable and significant harmful

impacts. Because of this dramatic uptick in CO

concentrations, the average global surface

temperature has increased by around 1.1 degrees Celsius compared with the average in

1850–1900—a level that hasn’t been witnessed since 125,000 years ago, before the most

recent ice age.

This warming trend is particularly pronounced in recent years: the seven

warmest years on record are the last seven years (2015-2021), and the 2010-2019 decade is

the warmest decade recorded.

This makes sense on a fundamental level, because the

warming effect of greenhouse gases is compounded by further emissions since they can

remain in the atmosphere for long periods of time (particularly CO

). As explained in the

Fourth National Climate Assessment, “[w]aiting to begin reducing emissions is likely to

increase the damages from climate-related extreme events (such as heat waves, droughts,

wildfires, flash floods, and stronger storm surges due to higher sea levels and more powerful

hurricanes).”

California is already experiencing the effects of climate change, and it is expected that these

effects will worsen in the coming decades, particularly if actions are not taken to mitigate

CARB 2016. California Air Resources Board 2016 Mobile Source Strategy,

https://ww3.arb.ca.gov/planning/sip/2016sip/2016mobsrc.pdf Released May 2016. Accessed February 8, 2022.

CARB 2022a. “Draft 2022 State Strategy for the State Implementation Plan”

IPCC 2021. Intergovernmental Panel on Climate Change. 2021. The Physical Science Basis: Summary for

Policymakers. IPCC, Switzerland. October 2021.

https://www.ipcc.ch/report/ar6/wg1/downloads/report/IPCC_AR6_WGI_SPM_final.pdf. (IPCC uses the

reference period 1850–1900 to approximate pre-industrial temperature, as this is the earliest period with near-

global observations.).

UN 2022. United Nations (UN) News, 2021 joins top 7 warmest years on record: WMO (Jan. 19, 2022), 2021

joins top 7 warmest years on record: WMO | | UN News.

USGCRP 2018. U.S. Global Change Research Program. 2018. Impacts, Risks, and Adaptation in the United

States: Fourth National Climate Assessment, Volume II. [Reidmiller, D.R., C.W. Avery, D.R. Easterling, K.E.

Kunkel, K.L.M. Lewis, T.K. Maycock, and B.C. Stewart (eds.)]. U.S. GCRP, Washington, DC, USA, 1515 pp. doi:

10.7930/NCA4.2018.

greenhouse gas emissions. For instance, consistent with global and US observations,

California temperatures have risen since records began in 1895, with the rate of increase

accelerating since the 1980s.

Data released in the fall of 2020 by NOAA’s National Centers

for Environmental Information

shows that September 2020 officially ranks as California’s

hottest September since record-keeping began in 1880. And the summer of 2021 was

California’s hottest summer on record. Tracking with rising temperatures, California’s annual

wildfire extent has increased fivefold since the 1970s,

and California’s 2020 fire season

alone shattered records, not only in the total amount of acres burned (at just over 4 million)

but also in wildfire size, with 5 of the 6 largest wildfires in California history occurring in

2020.

If greenhouse gas emissions continue to rise, one study found that by 2100 the

frequency of extreme wildfires burning 25,000 acres or more would increase by nearly 50

percent and average area burned statewide would increase by 77 percent.

Indeed, a recent

study suggests that smoke from wildfires like these could become one of the deadliest

climate impacts within decades.

And with these growing wildfires comes increased costs:

California’s wildfire spending has already more than tripled since 2005 because of the

climate-change-induced increase in number and severity of wildfires.

Climate change also exacerbates other air pollution problems throughout California.

Increasing temperatures generally cause increases in ozone concentrations in California’s

OEHHA 2018. Office of Environmental Health Hazard Assessment, California Environmental Protection

Agency (2018). Indicators of Climate Change in California. https://oehha.ca.gov/media/downloads/climate-

change/report/2018caindicatorsreportmay2018.pdf.

NOAA 2020. National Oceanic and Atmospheric Administration. Earth just had its hottest September on

record (Oct. 14, 2020), https://www.noaa.gov/news/earth-just-had-its-hottest-september-on-record.

Williams 2019. Williams, A. P., Abatzoglou, J. T., Gershunov, A., Guzman‐ Morales, J., Bishop, D. A., Balch, J.

K., & Lettenmaier, D. P. (2019). Observed impacts of anthropogenic climate change on wildﬁre in California.

Earth's Future, 7, 892–910. https://doi.org/10.1029/2019EF001210

LA Times 2021a. John Myers, “California unveils sweeping wildfire prevention plan amid record fire losses and

drought,” LA Times, April 8, 2021, https://www.latimes.com/california/story/2021-04-08/california-wildfire-

prevention-536-million-newsom-lawmakers. Accessed March 9, 2022.

Marshall Burke et al. 2021, The Changing Risk and Burden of Wildfire in the United States, PNAS 118(2)

e2011048118, January 12. 2021, https://doi.org/10.1073/pnas.2011048118. Accessed March 9, 2022

Id.

LA Times 2021b. Tony Barboza, “Wildfire smoke now causes up to half the fine-particle pollution in Western

U.S., study finds,” LA Times, Jan. 13, 2021, https://www.latimes.com/california/story/2021-01

-13/wildfire-

smoke-fine-particle-pollution-western-us-study, Accessed March 9, 2022. (new study blames climate change for

worsening air quality and health risks in both urban and rural communities in recent years)

Marshall Burke, et al. 2021.

AP 2021. Adam Beam, California Oks new spending on drought, wildfire prevention, Associated Press,

September 9, 2021, California OKs new spending on drought, wildfire prevention | AP News; see also

Legislative Analyst’s Office, State Wildfire Response Costs Estimated to Be Higher Than Budgeted, Fig. 3 (Oct.

19, 2020), State Wildfire Response Costs Estimated to Be Higher Than Budgeted (ca.gov).

LAO 2020. Legislative Analyst’s Office, State Wildfire Response Costs Estimated to Be Higher Than

Budgeted, Fig. 3, October 19, 2020, https://lao.ca.gov/Publications/Report/4285.

polluted regions.

And increasing frequency and intensity of wildfires is already having a

measurable effect on air quality.

In 2020, California came under siege from record-

breaking heat waves and smoke from more than 7,000 fires burning simultaneously, and the

Bay Area even awoke to an eerie deep-orange sky.

Similarly, climate change is increasing

the frequency of droughts, which will increase wind erosion and ambient dust

concentration.

As soils become increasingly dry during a drought, dust from the ground is

more likely to become airborne. Particulate matter suspended in the air from these events or

from wildfire smoke can increase the risk for respiratory infections like bronchitis and

pneumonia, which will result in greater health costs to the State.

66,67

These intense heat waves and widespread wildfire smoke caused Southern California to

experience worse air pollution readings and the highest number of health-damaging bad air-

days since the mid-1990s. There were 157 bad-air days for ozone pollution across the vast,

coast-to-mountains basin spanning Los Angeles, Orange, Riverside and San Bernardino

Counties—the most days above the federal health standard since 1997. This ”climate

penalty” threatens to degrade the notable air quality improvements California has made, and

it makes attaining and maintaining federal and state air quality standards more difficult.

California has met its obligations under the federal Clean Air Act to develop state

implementation plans to attain the NAAQS. But those plans are increasingly requiring greater

emission reductions as a percentage of CARB’s total mobile source contribution to meet the

federal ambient air quality standards.

Failing to meet or make adequate progress toward meeting the federal standards requires at

minimum further planning and emissions reductions. If the State fails to meet those planning

Shupeng et al 2019. Zhu, Shupeng, Jeremy R Horne, Michael Mac Kinnon, G S Samuelsen, and Donald

Dabdub. 2019. “Comprehensively Assessing the Drivers of Future Air Quality in California.” Environment

International 125: 386–98. https://doi.org/10.1016/j.envint.2019.02.007, Accessed March 9, 2022.

KVPR 2021. Kerry Kline, ”As temperatures rise, air quality experts keep an eye on ’ozone climate penalty’,”

KVPR, November 16, 2021, https://www.kvpr.org/health/2021-11-16/as-temperatures-rise-air-quality-experts-

keep-an-eye-on-ozone-climate-penalty. Accessed March 9, 2022.

Lung 2021. The American Lung Association’s State of the Air: 2018 report also found that California’s ozone

levels rose significantly in 2016 due to extreme temperatures (page 4), and its State of the Air: 2021 report also

notes the continuing role warming temperatures play on air quality (pages 13 & 14, State of the Air 2021

(lung.org)).

Kalashnikov 2022. Kalashnikov DA, Schnell JL, Abatzoglou JT, Swain DL, Singh D. “Increasing co-occurrence

of fine particulate matter and ground-level ozone extremes in the western United States.” Sci Adv.

2022;8(1):eabi9386. doi:10.1126/sciadv.abi9386 https://www.science.org/doi/pdf/10.1126/sciadv.abi9386

McClure 2018. McClure, Crystal D, and Jaffe, D. A. “US particulate matter air quality improves except in

wildfire-prone areas.” Proc Natl Acad Sci USA. 2018;115(31):7901-7906. doi:10.1073/pnas.1804353115

X. Liu, et al. 2017. “Airborne Measurements of Western U.S. Wildfire Emissions: Comparison with Prescribed

Burning and Air Quality Implications,” 122 J. GEOPHYS. RES. ATMOS. 6108-29 (2017), doi:10.1002/2016JD

026315 (showing that wildfires emit fine particulate matter at over three times the level previously estimated)

NY Times 2020. Thomas Fuller & Christopher Flavelle, “A Climate Reckoning in Fire-Stricken California,” N.Y.

TIMES, Sept. 18, 2020, https://www.nytimes.com/2020/09/10/us/climate-change-california-wildfires.html.

Accessed March 9, 2022.

Duniway et al 2019. M.C. Duniway, et al., Wind Erosion and Dust from US Drylands: A Review of Causes,

Consequences, and Solutions in a Changing World, E

COSPHERE 10(3) (2019).

Stanke et al 2013. C. Stanke, et al., Health Effects of Drought: A Systematic Review of the Evidence, PLOS

CURRENTS, 5 (2013).

Jones er al 2020. See, e.g., C.G. Jones, et al., Out-of-Hospital Cardiac Arrests and Wildfire-Related Particulate

Matter During 2015-2017 California Wildfires, J.

AM. HEART ASSOC. 9(8) (2020).

obligations, it can ultimately trigger extreme consequences. These include, for stationary

sources of emissions like factories, increased fees and offset requirements.

The State can

also be blocked from receiving federal highway funds, and U.S. EPA may impose a federal

implementation plan to meet the standards.

Emission reductions – including from vehicles

covered by this proposal – are urgently needed to respond to the climate crisis and ensure

that California’s air quality progress to date continues forward and is not erased.

B. Advancing Environmental Justice

In addition to meeting health-based air quality standards and climate change goals, emission

reductions are particularly necessary in areas most vulnerable to, and that have been

disproportionately impacted by, pollution. In many overburdened and underserved

communities, the pollution and public health impacts from on-road vehicle emissions are

especially significant and greater than in other communities. These impacts are often

compounded by the congregation of nearby industrial sources, including upstream, mid-

stream, and downstream fuel production sources. Underserved communities are also

especially vulnerable to the economic impacts and health burdens associated with climate

change, as the most severe harms from climate change fall disproportionately upon these

underserved communities who are least able to prepare for and recover from associated

impacts.

70,71,72,73

Racial and ethnic minority communities are particularly vulnerable to the

greatest impacts of climate change, and climate change increasingly impacts places, foods,

and lifestyles of Native American Tribes, threatening traditional livelihoods and critical

infrastructure.

74, 75, 76

Improving access to clean transportation and mobility options for low-income households

and communities most impacted by pollution supports equity and environmental justice and

is key in achieving emission reductions. Both state and federal law focus CARB’s attention on

eliminating inequitable pollution burdens. Title VI of the U.S. Civil Rights Act of 1964

42 U.S.C. § 7511d.

42 U.S.C. § 7509.

EPA 2021c. United States Environmental Protection Agency. Climate Change and Social Vulnerability in the

United States: A Focus on Six Impact Sectors. (EPA 430-R-21-003) https://www.epa.gov/cira/social-vulnerability-

report September 2021. Accessed January 31, 2022.

Petkova 2016. Elisaveta Petkova. The Disproportionate Consequences of Climate Change.

https://ncdp.columbia.edu/ncdp-perspectives/the-disproportionate-consequences-of-climate-change/ February

12, 2016. Accessed January 31, 2022.

OEHHA 2010. Indicators of Climate Change in California: Environmental Justice Impacts Report, OEHHA,

https://oehha.ca.gov/climate-change/document/indicators-climate-change-california-environmental-justice-

impacts-report Released December 31, 2010. Accessed January 31, 2022.

IPCC 2021.

Patnik 2020. Aneesh Patnaik, Jiahn Son, Alice Feng, Crystal Ade. Racial Disparities and Climate Change.

https://psci.princeton.edu/tips/2020/8/15/racial-disparities-and-climate-change Released August 15, 2020.

Accessed January 31, 2022.

Maldonado 2013. Julie Koppel Maldonado, Christine Shearer, Robin, Bronen, Kristina Peterson, and Health

Lazrus. Climate Change (213) 120:601-614. The Impact of Climate Change on Tribal Communities In The US:

Displacement, Relocation, and Human Rights.

http://wordpress.ei.columbia.edu/climate-adaptation/files/2017/10/Maldonado-et-al-2011-Tribal-resettlement-

US_ClimaticChange.pdf

ublished April 9, 2013. Accessed January 31, 2022.

Laduzinsky 2019. Paige Laduzinsky. The Disproportionate Impact of Climate Change on Indigenous

Communities. https://www.kcet.org/shows/tending-nature/the-disproportionate-impact-of-climate-change-on-

indigenous-communities December 19, 2019. Accessed February 1, 2022.

prohibits discrimination on the basis of race, color, or national origin in all agency programs

or activities receiving federal funding -- and both state transportation and pollution programs

are federally funded, motivating a strong focus on remediating disparate impacts of air

pollution.

77,78

CARB’s statewide strategy to address these goals is further informed by

specific legal commitments to address disparate pollution exposure, including the pollution

generated by the transportation sector.

Furthermore, AB 32, the California Global

Warming Solutions Act of 2006, directs CARB to “ensure that [its GHG] regulations [and]

programs … where applicable and to the extent feasible, direct public and private

investment toward the most disadvantaged communities in California.

Staff’s approach to advancing environmental justice in this proposal is multi-faceted and sits

within a larger set of actions – from incentive programs to other regulatory measures –

intended to protect priority populations. The significant pollution reductions from the

proposal as a whole, when accounting for cleaner ICEVs as well as ZEVs, will reduce exposure

to vehicle pollution in communities throughout California, including in low-income and

disadvantaged communities that are often disproportionately exposed to vehicular

pollution.

Further, the proposed ZEV assurance measures will ensure these emissions benefits are

realized and long-lasting, while supporting more reliable ZEVs in the used vehicle market.

Durable and better performing used ZEVs can help increase access to clean vehicle

technologies for communities that may not be buying new vehicles, but which do need

reliable household mobility options.

As part of this overall portfolio approach to equity and environmental justice, staff have also

proposed provisions to encourage manufacturers to take actions that improve access to ZEVs

for disadvantaged, low-income, and other frontline communities, including by investing in

community car share programs, producing affordable ZEVs, and keeping used vehicles in

California to support CARB’s complementary equity incentive programs.

C. California has unique authority under federal law to regulate vehicle emissions

California has long held and implemented its authority under state and federal law to reduce

emissions from motor vehicles. The federal Clean Air Act provides California an exemption

from federal preemption of state motor vehicle emission standards.

In recent years, that

authority was called into question by several illegal actions by the administration of President

Trump.

C. Garcia, Chapter 136, Statutes of 2017

California Health and Safety Code sec. 44391.2(b) and (c)(4)

CARB 2018a. Community Air Protection Program Blueprint, Appendix D – Statewide Actions

https://ww2.arb.ca.gov/sites/default/files/2020-

06/final_community_air_protection_blueprint_october_2018_appendix_d_acc.pdf October 2018. Accessed

January 31, 2022.

California Health and Safety Code sec. 38565

Apte 2019.

Clean Air Act, § 209(b), 42 U.S.C. §7543(b).

In 2019, the U.S. EPA and the U.S. Department of Transportation, through NHTSA, finalized rules and actions

to preempt California’s authority for its greenhouse gas emission and ZEV standards in ACC. Specifically,

CARB challenged all aspects of those actions.

While the challenges have remained

pending, CARB administered its greenhouse gas emission and ZEV standards on a voluntary

basis in anticipation of successfully overturning these illegal federal rules and actions.

On January 20, 2021, President Biden issued his Executive Order on Protecting Public Health

and the Environment and Restoring Science to Tackle the Climate Crisis.

Among other

things, the Order directed U.S. EPA and NHTSA to consider revisiting the SAFE Rules. In

April 2021, U.S. EPA published its proposal to restore California’s waiver for these

regulations.

On December 21, 2021, NHTSA finalized its action to rescind the preemption

regulation.

U.S. EPA restored California’s waiver for its Advanced Clean Cars greenhouse gas emission

and ZEV standards on March 14, 2022.

The proposed standards are entitled to a waiver of

federal preemption under the Clean Air Act and CARB expects to obtain that waiver in due

course if the proposed regulations are adopted.

D. California has broad authority under California law to regulate vehicle emissions

CARB has been granted both broad and extensive authority under the Health and Safety

Code (HSC) to adopt the Proposed Amendments. The California Legislature has placed the

responsibility of controlling vehicular air pollution on CARB and has designated CARB as the

state agency that is “charged with coordinating efforts to attain and maintain ambient air

quality standards, to conduct research into the causes of and solution to air pollution, and to

systematically attack the serious problems caused by motor vehicles, which is the major

source of air pollution in many areas of the State.”

CARB is authorized to adopt standards,

rules and regulations needed to properly execute the powers and duties granted to and

imposed on CARB by law.

HSC 43013 and 43018 broadly authorize and require CARB to

NHTSA adopted a regulation stating that the Energy Policy and Conservation Act (EPCA), which sets fuel

economy standards, preempts California’s greenhouse gas emission and ZEV standards. U.S. EPA revoked

California’s waiver of federal preemption under the Clean Air Act for the same standards. The Safer Affordable

Fuel-Efficient (SAFE) Vehicles Rule Part One: One National Program, 84 Fed. Reg. 51,310 (Sept. 27, 2019).

CARB challenged the SAFE Part One Rule as well as the related Final Rule that revised federal greenhouse

gas emission and fuel economy standards. See California v. Wheeler, et al., Case No. 19-1239, consolidated

under No. 19-1230.; 85 Fed. Reg. 24,174 (Apr. 30, 2020) (Final SAFE Vehicles Rule); California v. Wheeler, et al.,

United States Court of Appeals, District of Columbia Circuit, Case No. 20-1167, consolidated under No. 20-

1145, with Nos. 20-1168, 20-1169, 20-1173, 20-1174, 20-1176, and 20-1177 (Challenge to the Final SAFE

Vehicles Rule). The challenges are pending and in abeyance in the United States Court of Appeals for the

District of Columbia Circuit.

Presidential Documents 2021. “Protecting Public Health and the Environment and Restoring Science To

Tackle the Climate Crisis.” Federal Register 86, no. 14 (January 25, 2021): 7037.

https://www.govinfo.gov/content/pkg/FR-202

1-01-25/pdf/2021-01765.pdf

EPA 2021d. U.S. Environmental Protection Agency. “California State Motor Vehicle Pollution Control

Standards; Advanced Clean Car Program; Reconsideration of a Previous Withdrawal of a Waiver of Preemption;

Opportunity for Public Hearing and Public Comment.” Federal Register 86, no. 80 (April 28, 2021): 22421.

https://www.govinfo.gov/content/pkg/FR-2021-04-28/pdf/2021-08826.pdf

NHTSA 2021. Department of Transportation. “Corporate Average Fuel Economy (CAFE) Preemption.”

Federal Register 86, no. 247 (December 29, 2021). 74236. https://www.govinfo.gov/content/pkg/FR-2021-12-

29/pdf/2021-28115.pdf

87 Fed. Reg. 14,332, March 14, 2022.

HSC 39002 and 39003.

HSC 39600 and 39601.

achieve the maximum feasible and cost-effective emission reductions from motor vehicles.

This authority encompasses adopting and implementing vehicle emission and in-use

performance standards,

and requirements to improve emission system durability and

performance.

CARB is further authorized to adopt and implement emission standards for new motor

vehicles and new motor vehicle engines that are necessary and technologically feasible

and

to adopt test procedures and any other procedures necessary to determine whether vehicles

and engines are in compliance with the emissions standards.

Indeed, CARB may not certify

a new motor vehicle or motor vehicle engine for legal sale in California unless a manufacturer

shows, according to the required test procedures, that it meets the emission standards

adopted by CARB.

CARB is also mandated to ”adopt rules and regulations . . . to achieve the maximum

technologically feasible and cost-effective greenhouse gas emission reductions from sources

or categories of sources”, and to “ensure that statewide greenhouse gas emissions are

reduced to at least 40 percent below the statewide greenhouse gas emissions limit no later

than December 31, 2030.”

III. Summary of Staff’s ZEV Regulation Proposal

The following chapter summarizes staff’s proposals related to ZEVs and PHEVs. Overall, staff

focused its proposal on what is necessary to achieve 100-percent ZEV or PHEV sales by the

2035 model year in California. The proposal includes increasing annual sales requirements of

ZEVs and PHEVs between the 2026 and 2035 model years, minimum technical performance

requirements for ZEVs and PHEVs, addressing credits for over compliance accrued under the

existing standards while maintaining appropriate flexibilities, and requiring a suite of ZEV

assurance measures to ensure ZEVs can serve as full replacements to ICEVs for all drivers in

the new and used vehicle markets, thereby ensuring ZEVs permanently displace emissions

from ICEVs and preserving the emission benefits of the regulations.

A. Background

1. ZEV Technologies

By definition, ZEVs produce no exhaust emissions under any possible operational mode.

BEVs and FCEVs are the most common examples of ZEVs and are the foundation of staff’s

proposal.

BEVs utilize batteries with an on-board charger to store energy from the electrical grid to

power electric motors. These electric vehicles have instant torque response, low noise,

regenerative braking from energy recovered by the motor that greatly reduces brake wear

HSC 43013(a).

HSC 43018(c)(2).

HSC 43101.

HSC 43104.

HSC 43102.

HSC 38560 and 38566.

and associated emissions, and generally have a simplified mechanical drivetrain, often

without a transmission.

FCEVs are full electric drive vehicles where the propulsion energy is supplied by hydrogen

stored on board and a fuel cell stack that transforms the chemical energy stored in hydrogen

into electricity for the drive motor. The electrochemical process for the fuel cell stack is fed

by oxygen (retrieved from ambient air) and hydrogen (stored on board in pressurized tanks),

with the byproducts being electricity, water, and heat (although it does not combust the

hydrogen). The major components of the fuel cell system include the fuel cell stack,

necessary associated equipment (e.g., fuel valves, air compressor, coolant fluid sub-system,

etc.), and a battery pack. FCEVs are able to travel long distances between refueling events

due to the large quantity of energy in the hydrogen stored in the on-board tanks and are

able to refill with hydrogen in times similar to gasoline vehicles.

Although not a ZEV by definition because of its internal combustion engine emissions, PHEVs

also use battery packs to power electric motors. In addition to their battery pack with grid-

supplied electricity, these vehicles use another fuel, typically gasoline, to power an internal

combustion engine. PHEV powertrains can be categorized into two different groups –

blended and non-blended. Blended PHEVs do not have an electric drive powertrain that can

meet all the motive power requirements of the vehicle on electric power only; they require

the combustion engine to meet the higher power demands of the vehicle even when the

battery has not been depleted. On the other hand, non-blended PHEVs are capable of

driving on electric power for the majority of driving conditions until the battery has been

depleted. Non-blended PHEVs require electric motors that can deliver power levels roughly

equal to that of the ICE.

2. ZEV Technology is Rapidly Improving

Much of the market growth of ZEVs is attributed to improvements in ZEV technology. The

industry has rapidly responded to evolving market pressures, consumer demands, and

regulatory requirements in California, across the U.S., and around the globe. Overall, these

improvements have reduced costs for batteries, the main driver of BEV and PHEV costs, as

well as for non-battery components. This has enabled manufacturers to accelerate plans to

bring to market more long-range ZEVs in more market segments and highly capable PHEVs.

Looking to the future of electric drive technologies in the 2026 to 2035 timeframe, it is

anticipated there will be even greater efficiency improvements, longer ranges, and

comparable vehicle offerings and capabilities across all passenger car and truck categories

and comparable costs to ICEVs as summarized further in Appendix G.

a) BEV Technology Improvements

BEV technology has progressed quickly since the market introduction of the Nissan LEAF, the

first widely available BEV, in 2010. Lithium-ion batteries (LIB), used in virtually every ZEV

application, continue to improve resulting in increased energy capacity and decreased cost.

Additional background on how this technology works is summarized by the U.S. Department of Energy (U.S.

DOE) here: https://afdc.energy.gov/vehicles/electric_basics_ev.html

Additional background from the U.S. DOE: https://afdc.energy.gov/vehicles/fuel_cell.html

Additional background from the U.S. DOE: https://afdc.energy.gov/vehicles/electric_basics_phev.html

LIBs consist of the following main components: a cathode, an anode, current collectors, a

separator, electrolyte, and a case of some kind to contain those components. Lithium-ion

technology, evolving through innovative chemistries, provides the best balance of energy

density and cost of any rechargeable battery technology available today, allowing

manufacturers to store more energy in a battery pack at a lower cost.

All in all, BEVs are becoming highly attractive vehicles with integrated platform designs,

leading to increased range and efficiency. Significant improvements in range can be seen in

BEV offerings from many manufacturers, such as Ford, General Motors, Nissan, Tesla, and

Volkswagen (VW). Range increases have come from several technology advancements,

including manufacturers moving to dedicated BEV platforms that have further improved total

vehicle efficiency, mass, and available space for larger battery packs to respond to consumer

demand.

The median driving range of 2021 model year BEVs has increased to 234 miles, but that still

trails the median range of a gasoline vehicle of 403 miles. The increase in electric range is

necessary for market development as consumers are looking for EVs that can go 300 to 500

or more miles on a single charge and that cost about the same as their gasoline

counterparts.

100,101,102

There are already BEV models in the process of certifying for the 2022

model year achieving a maximum range of 520 miles, including the Lucid Air. As more long-

range BEVs become available, the discrepancy in range between gasoline-powered vehicles

and BEVs is likely to continue to narrow.

103

1) Battery Costs Are Falling

Looking ahead, recent findings indicate that battery costs will continue to decline in the long

term. Bloomberg New Energy Finance (BNEF), a respected provider of strategic research

covering commodity markets and disruptive low-carbon technology, conducted industry

surveys indicating that prices of automotive battery packs were $137/kWh by the end of

2020, representing a nearly 90-percent decline from 2010.

104

BNEF’s 2021 annual battery

price survey found that battery prices have continued to fall through 2021 to $132/kWh. That

is a 6-percent drop from their findings for 2020 of $140/kWh but rising raw material prices

like lithium or nickel could cause battery prices to rise in 2022 to $135/kWh. BNEF anticipates

achieving $100/kWh, but in 2026 as opposed to 2024 due to those near-term raw material

100

Consumer Reports 2020. Consumer Reports, “Consumer Interest and Knowledge of Electric Vehicles: 2020

Survey Results”, Published December 2020.

101

Cox 2021a. Cox Automotive, “2021 Cox Automotive Path to EV Adoption Study”, Conducted June/July

2021.

102

Deloitte 2022, Deloitte “2022 Global Automotive Consumer Study”, Published January 2022.

103

DOE 2022a. US Department of Energy. Fact of the week #1221. “January 17, 2022: Model Year 2021 All-

Electric Vehicles Had a Median Driving Range about 60% That of Gasoline Powered Vehicles”

https://www.energy.gov/eere/vehicles/articles/fotw-1221-january-17-2022-model-year-2021-all-electric-vehicles-

had-median Accessed February 11, 2022.

104

BNEF 2020. Bloomberg New Energy Finance. 2020. “Battery Pack Prices Cited Below $100/kWh for the First

Time in 2020, While Market Average Sits at $137/kWh.” December 16, 2020. Accessed March 22, 2022.

https://about.bnef.com/blog/battery-pack-prices-cited-below-100-kwh-for-the-first-time-in-2020-while-market-

average-sits-at-137-kwh/.

price increases and supply constraints.

105

The National Academies of Sciences (NAS), a panel

of academics, scientists, engineers, and other recognized experts in the field, released an

assessment of battery costs expecting automotive battery pack costs to decrease to $90-

$115/kWh by 2025 and $65-$80/kWh by 2030.

106

Researchers credit falling prices to

improved and simplified battery cell and pack designs, lower raw material input costs,

introduction of new battery chemistries, adjustments to cathode technologies, new

manufacturing techniques, and increasing production volumes.

107 108

2) Dedicated Electric Vehicle Platform Design

Another improvement in BEV technology is the use of dedicated vehicle platforms. Earlier in

the development of BEVs, manufacturers used both shared and dedicated platforms for their

vehicle offerings; however, most manufacturers have shifted to dedicated platforms as they

electrify their fleets. Use of a shared platform across ICEV and BEV models allows

commonality and facilitates access to international markets for increased volumes, while a

dedicated platform allows for a higher level of optimization specifically for the electric vehicle

technology. Dedicated BEV platforms avoid provisions for gasoline powertrains, exhaust

emissions, evaporative emissions, and fuel systems that would otherwise need to be

accommodated on platforms that are shared between BEV, PHEV, HEV, and ICEV models.

This dedicated BEV platform approach allows integration of the battery pack entirely within

the vehicle floor structure, reduces vehicle weight, reduces manufacturing costs, increases

available passenger and cargo volume, and in some cases, has the battery pack integrated as

part of the vehicle's crash mitigation structure. Those developments enable even greater

vehicle efficiencies by reducing structural material in the chassis and battery pack and

increasing battery cell packing efficiency without the battery module specific materials. Most

importantly, it decreases costs.

3) Battery Pack Capacity and Energy Efficiency Improvements

Another technology trend improving the functionality of BEVs is an increase in battery pack

capacity, which enables more range and overall vehicle capability. Battery packs as large as

200 kWh have now entered the market in larger vehicles like the GMC Hummer EV truck with

329 miles of range.

109

Other models like the Tesla Model 3 Long Range have increased

battery capacity from 75kWh to 82kWh partway through the 2021 model year. Nissan has

105

BNEF 2021. Bloomberg New Energy Finance. “Battery Pack Prices Fall to an Average of $132/kWh, But

Rising Commodity Prices Start to Bite” https://about.bnef.com/blog/battery-pack-prices-fall-to-an-average-of-

132-kwh-but-rising-commodity-prices-start-to-bite/ Released November 30, 2021. Accessed February 11, 2022.

106

NAS 2021. National Academies of Sciences, Engineering, and Medicine. 2021. Assessment of Technologies

for Improving Light-Duty Vehicle Fuel Economy—2025-2035. Washington, DC: The National Academies Press.

https://doi.org/10.17226/26092. March 31, 2021. Accessed January 31, 2022.

107

BNEF 2020.

108

NAS 2021.

109

MotorAuthority 2021. Stephen Edelstein. “2022 GMC Hummer EV Edition 1 to have 329 miles of range, too

heavy for official EPA rating” https://www.motorauthority.com/news/1134272_2022-gmc-hummer-ev-edition-1-

to-have-329-miles-of-range-too-heavy-for-official-epa-rating November 24, 2021. Accessed January 31, 2022.

introduced a 62kWh battery option for the 2021 model year LEAF

110

and Chevrolet has

increased its Bolt battery packs from 60kWh to 64kWh.

In conjunction with increases in battery pack energy capacity, energy efficiencies of BEVs also

are increasing which can increase range and reduce costs. Several vehicle models that have

been in the market for more than one or two model years have seen year-over-year energy

efficiency increases since they were first introduced. Efficiency in BEVs is expressed as miles-

per-gallon equivalent (MPGe) which is a metric based on energy content that can be used to

compare across different vehicle technologies and fuels.

111

Tesla’s Model 3 Long Range AWD

model variants started in 2018 with 116 MPGe and in less than four years are now achieving

an efficiency of 131 MPGe.

112

The Model S has increased 35-percent from 89 MPGe to 120

MPGe in the ten years since it was first introduced for the 2012 model year. New models like

the model year 2022 Lucid Motors Air large sedan are also debuting with impressive

efficiencies for the vehicle’s size and power indicating that further gains in efficiency can be

had by better reducing mass and better optimizing for efficiency rather than (or sometime in

addition to) performance.

113

Ford has taken a similar approach, making on the line-

improvements to cut costs, reduce weight, and increase efficiency which has resulted in more

range. The 2022 Ford Mach-E has achieved a maximum range of 314 miles, up from 305

miles for the 2021 model.

114

b) FCEV Technology Improvements

Fuel cell systems utilized in FCEVs have also significantly improved in recent decades helping

reduce costs on the vehicle side. The United States Department of Energy (U.S. DOE) reports

that fuel cell stack costs have fallen 70-percent since 2008 (at high production volumes).

115

Hyundai reports a similar cost reduction of 98-percent between prototype systems

developed in 2003 and their next-generation fuel cell systems set for commercial

introduction in the near future.

116

Durability of Hyundai fuel cells are also reported to have

increased from 3,000 hours/100,000 km (62,000 miles) in their first-generation system to a

target 500,000 km (310,000 miles) in their next-generation fuel cell system for commercial

applications. The fuel cell systems have also increased total power over time while becoming

more compact due to increasing system power density. Toyota has reported similar gains

110

Nissan 2022. Nissan Leaf 2021 Model Year. https://www.nissanusa.com/vehicles/electric-

cars/leaf/features/range-charging-battery.html Accessed January 31, 2022

111

DOE 2022b. United States Department of Energy. Learn About the Label. “Electric Vehicle”

https://www.fueleconomy.gov/feg/Find.do?action=bt1 Accessed February 21, 2022.

112

DOE 2022c. United States Environmental Protection Agency and United States Department of Energy. n.d.

Fueleconomy.gov 2018 Tesla Model 3 Long Range AWD and 2022 Tesla Model 3 Long Range AWD. Accessed

January 31, 2021. https://www.fueleconomy.gov/feg/Find.do?action=sbs&id=40385&id=45011.

113

Lucid 2021. PDF. Comment letter submitted to CARB by Lucid on June 11, 2021.

114

Green Car 2022. Edelstein, Stephen. 2022. “CEO: Ford plans to “reengineer” Mustang Mach-E

incrementally, won’t save improvements for mid-cycle refresh” By Stephen Edelstein

https://www.greencarreports.com/news/1134986_ceo-ford-plans-to-reengineer-mustang-mach-e-incrementally-

wont-save-improvements Posted February 2, 2022. Accessed February 15, 2022.

115

Satyapal 2021. “2021 AMR Plenary Session” Satyapal, Sunita. (presentation, 2021 US Department of Energy

Hydrogen Technology Office Annual Merit Review, Online, June 7, 2021).

116

Hyundai 2021. “Hyundai Motor Group’s next-generation fuel cell system, a key technology for popularizing

hydrogen energy,” Hyundai Motor Group, September 7, 2021.

https://tech.hyundaimotorgroup.com/article/hyundai-m

otor-groups-next-generation-fuel-cell-system-a-

keytechnology-for-popularizing-hydrogen-energy/. Accessed February 1, 2022

between its first and second generation Mirai. The second-generation fuel cell, released in

model year 2021, is 20-percent smaller, 50-percent lighter, and 12-percent more powerful

than the fuel cell in the first generation Mirai.

117

Despite FCEVs being very early in their

commercial development with significant remaining opportunity for future cost reduction, the

second-generation Mirai list price was approximately $9,000 less than its predecessor.

igure

c) PHEV Technology Improvements

PHEV technology also continues to evolve as manufacturers introduce different

architectures and all-electric capabilities, and is discussed further in Appendix G. Toyota

more than doubled the equivalent all-electric range of the Prius Plug-in Hybrid in five

model years. In addition to more all-electric range, the Prius Prime also had improvements

in electric power, enabling it to complete 10 miles on the US06 drive cycle under electric

power alone. Four model years later, Toyota introduced the larger 2020 model year RAV4

Prime with a 68-percent range improvement over the Prius Prime.

118

The RAV4 Prime also

includes all-wheel drive (AWD) and even more all-electric power than the Prius Prime.

Ford has also improved their PHEVs with their second-generation products. The C-MAX

and Fusion Energi Plug-in Hybrids both debuted for the 2013 model year with 20 miles of

electric range. The larger Ford Escape PHEV debuted for the 2020 model year with 37

miles of electric range

119

as did a much larger Lincoln Aviator PHEV with three rows of

seating and 21 miles of range. Other manufacturers have also increased range in their

PHEV offerings, like Volvo with its T8 variants of the XC60, XC90, V60, S60, and S90

vehicles; Karma with its Revero GT; BMW with its ‘e’ variants of the X5, 3 series, and 7

series; Hyundai with its Ioniq, Santa Fe, and Tucson models; and Kia with its Sorento and

Niro. Jaguar Land Rover (JLR) also recently announced the Range Rover P440e with 48

miles of range for the 2023 model year.

120

Those improvements stem from some of the same improvements in BEVs. Improved

electric motors and power electronics are being utilized to further enhance all-electric

operation efficiency to extend range. Heat pumps have been integrated into PHEV

designs to increase all-electric efficiency in inclement weather. Increases in PHEV battery

energy capacity can lead to longer zero-emission ranges in future vehicle designs.

117

Toyota 2020. “Toyota Introduces Second-Generation Mirai Fuel Cell Electric Vehicle as Design and

Technology Flagship Sedan,” Toyota Newsroom, December 16, 2020. https://pressroom.toyota.com/toyota-

introduces-second-generation-mirai-fuel-cell-electric-vehicle-as-design-and-technology-flagship-sedan/

Accessed February 1, 2022

118

DOE 2022d. United States Department of Energy. Compare Side-by-Side: 2012Toyota Prius, 2017 Toyota

Prius Prime, and 2021 Toyota Rav-4 Prime

https://www.fueleconomy.gov/feg/Find.do?action=sbs&id=32484&id=38531&id=42793 Accessed February 1,

2022

119

DOE 2022e. United States Department of Energy. Compare Side-by-Side: 2013 Ford Energi PHEV, 2013

Ford Energi, and 2020 Ford Escape PHEV

https://www.fueleconomy.gov/feg/Find.do?action=sbs&id=33336&id=33398&id=42743

120

Land Rover 2022. “New Range Rover: Orders Open For Flagship SV Model And Extended Range Plug-In

Hybrid With 48 Miles Of EV Range” https://media.landrover.com/en-us/news/2022/01/new-range-rover-orders-

open-flagship-sv-model-and-extended-range-plug-hybrid-48-miles Published January 27, 2022. Accessed

February 11, 2022.

3. Expansion of the ZEV Market

Technology developments for BEVs, FCEVs, and PHEVs have progressed quickly over the

past decade. This has led to the market introduction of ZEVs with longer driving ranges and

more efficient and capable drivetrains far earlier than previously estimated by staff. With

ongoing industry investment in technology improvements at unprecedented levels, ZEVs and

PHEVs are anticipated to have even greater efficiency improvements and longer ranges in

the near future, where electric vehicle offerings will span all passenger car and truck

categories with comparable capabilities as conventional gasoline vehicles.

a) Growth in US and Global Markets

The global electric fleet is rapidly growing, even despite a slowing of overall new vehicle

sales in 2020. By the end of 2020, the number of electric passenger vehicles reached 10

million units worldwide, an increase of 42-percent from 2019.

121

China maintained the largest

electric vehicle fleet in the world with a total of 4.5 million electric vehicles. However, Europe

had the largest annual increase in electric vehicles to reach a total of 3.2 million by the end of

2020. The United States had about 1.8 million electric drive registrations by the end of 2020,

with approximately 78-percent of newly registered electric cars in 2020 being BEVs and

FCEVs.

122,123

While the COVID-19 pandemic caused an overall fall in new car registrations in

2020, the share of global electric vehicle sales still increased from 2019 levels as electric

vehicle sales declined less than conventional vehicles.

b) Growth in the California Market

The California ZEV and PHEV market share held steady at about 7-percent of new light-duty

vehicle sales from 2018 to 2020 but has now begun surging upwards again. The growing

number of ZEV and PHEV models, continued expansion of California’s charging and

hydrogen fueling network, and the state’s commitment to strong electric vehicle incentives

helped maintain a robust market even during relatively flat total sales in 2018-2020. These

strong policy measures and technology advancements have also helped the ZEV and PHEV

market in California surge in 2021 to a 12.4-percent market share of new vehicle sales. Figure

2 shows the growth of ZEV and PHEV market share in California from 2012 to 2021, with

BEVs seeing a much larger market share than other technologies from 2018 onward. The

market share of ZEVs is expected to continue increasing.

121

ICCT 2021a. International Council on Clean Transportation. Updated on the Global Transition to Electric

Vehicles Through 2020 (Briefing) https://theicct.org/sites/default/files/publications/global-update-evs-transition-

oct21.pdf October 2021. Accessed January 31, 2022.

122

IEA 2021a. Global electric vehicle stock by region, 2010-2020, IEA, Paris https://www.iea.org/data-and-

statistics/charts/global-electric-vehicle-stock-by-region-2010-2020 April 28, 2021. Accessed January 31, 2022.

123

IEA 2021b. Global EV Outlook 2021. https://www.iea.org/reports/global-ev-outlook-2021 April 2021.

Accessed January 31, 2022.

Figure 2: California Market Share of ZEVs and PHEVs by Technology Type

124

This increase in market share can be attributed to at least a few factors: technology

improvement, discussed in Chapter III.A.3, and vehicle model diversity. First explored in

CARB’s 2017 MTR, vehicle diversity was a necessary factor to increasing market

acceptance.

125

Many of the electric vehicle models introduced prior to 2016 were in the small

and mid-size sedan category, market size segments that have been decreasing in volume

over time and had limited range. As passenger cars fade, crossovers, sport utility vehicles,

light pickup trucks and vans have grown to represent over 75-percent of new sales in the

United States and 65-percent in California.

126,127

In recent years, manufacturers have

responded to the market with an increasing electric vehicle model diversity and provided

greater range, as discussed below. Over the next few years, manufacturers are set to add

several pick-up trucks, SUVs, and crossover models.

128,129

Figure 2 shows the number of ZEV

and PHEV product offerings expected in the 2022 through 2025 model years, indicating that

ZEVs are expected in a broader array of market segments.

124

CEC 2022a. California Energy Commission Zero-Emission Vehicle and Infrastructure Statistics. Data.

https://www.energy.ca.gov/zevstats Accessed March 1, 2022/

125

CARB 2017d. California’s Advanced Clean Cars Midterm Review. Appendix B: Consumer Acceptance of Zero

Emission Vehicles and Plug-in Hybrids Electric Vehicles. https://ww2.arb.ca.gov/sites/default/files/2020-

01/appendix_b_consumer_acceptance_ac.pdf Released January 18, 2017. Accessed January 31, 2022.

126

CNCDA 2022. California New Car Dealers Association. 2022. California Auto Outlook: Comprehensive

information on the California vehicle market. February. Accessed March 4, 2022. https://www.cncda.org/wp-

content/uploads/Cal-Covering-4Q-21.pdf

127

NADA 2021a. Manzi, Patrick. 2021. “NADA Market Beat: December 2021.” National Automobile Dealers

Association. December. Accessed March 3, 2022.

https://www.nada.org/WorkArea/DownloadAsset.aspx?id=21474865289.

128

DOE 2015. United States Department of Energy. Fuel economy Guide Model year 2015.

https://fueleconomy.gov/feg/pdfs/guides/FEG2015.pdf Updated January 25, 2022. Accessed January 31, 2022.

129

DOE 2022f. United States Department of Energy. Fuel economy Guide Model year 2022.

https://fueleconomy.gov/feg/pdfs/guides/FEG2022.pdf Updated January 25, 2022. Accessed January 31, 2022.

Figure 3: Anticipated EPA Size Class for Model Year 2022 - 2025 ZEVs and PHEVs

c) Growth in Consumer Demand

In California, approximately 1,054,100 ZEVs and PHEVs were cumulatively sold by the end

of 2021, as reported through the California Department of Motor Vehicles.

130

This puts

California on track to reach the goal of 1.5 million electric vehicles on the road much sooner

than the 2025 goal and in a strong position to meet the goal of 5 million ZEVs on California’s

roads by 2030.

131

California continues to be a leader in building a sustainable ZEV market

ready for all new vehicle sales to be electric by 2035.

132

Car buyers are signaling growing interest in alternative powertrain technology, as Americans

and the industry seem to be passing the point of peak gas-powered mobility.

133,134

The role

of electric drive in solving environmental concerns is supported, evidenced by 71-percent of

American drivers saying that widespread electric vehicle use will help reduce air or climate

pollution.

135

In California, many are taking notice of the electric vehicle market, with 74-

percent of drivers in the State having at least some interest, and 40-percent considering

130

CEC 2022b

131

GO 2020.

132

For more detailed information about ZEV sales trends, see Appendix G “ACC II ZEV Technology Assessment

and Costs.”

133

Cox 2021b. Cox Automotive “Cox Automotive Commentary: June and First Half of 2021 U.S. Auto Sales”,

Published July 1, 2021.

134

Deloitte 2020. “2020 Global Automotive Consumer Study”, Accessed November 1, 2021.

135

Consumer Reports 2020.

going electric for their “next vehicle.”

136

This interest is turning into growing sales as shown

in Figure 2 above, with new vehicle market share of electric drive vehicles jumping to 12.4-

percent from 7.8-percent just the year prior in California. Further, satisfaction is high among

electric vehicle owners and is likely to lead to subsequent purchases of zero-emission

technology. Evidence of this is abundant in research, with J.D. Power for example reporting

82-percent of early adopters say they “definitely will” consider purchasing another electric

vehicle in the future.

137,138,139,140

4. Importance of the Used Vehicle Market

According to a McKinsey analysis “the used car market is more than twice the size of the

new car segment and outpacing it in growth.”

141

They estimate that as of 2018, “Americans

buy 39.4 million used cars each year, versus 17.3 million new ones.”

142

More people buy used

vehicles because they are less expensive than new vehicles, due to depreciation.

The used car market can be a powerful tool in ensuring ZEV access at all income levels.

Already, in disadvantaged communities in California, used electric vehicles are purchased at

higher rates than new electric vehicles.

143

On average, used electric vehicles cost 43-72-

percent less than new ones.

144

This makes the used market important in achieving California’s

carbon reduction goals, and a critical place to ensure ZEVs are thriving. As the ZEV market

expands over time, especially for used vehicles, ZEVs will likely become more attainable for

lower-income households.

5. Consumer Challenges Exist and Must be Addressed

Achieving 100 percent ZEV and PHEV sales by 2035 will require mainstream consumers to

embrace electric drive technologies in their purchasing. This consumer change will require

continued improvements in electric vehicle technology, owner support and conveniences, as

well as successful strategies to communicate the benefits to potential buyers.

136

Consumer Reports 2021. Consumer Reports. “Consumer Attitudes Towards Electric Vehicles and Fuel

Efficiency in California: 2020 Survey Results”, Published March 2021.

137

J.D. Power 2021a. JD Power “Majority of Electric Vehicle Owners Are Intent on Purchasing Another One in

the Future, J.D. Power Finds” (Press release), Published January 21, 2021.

138

Hardman 2021. Scott Hardman and Gil Tal, “Discontinuance Among California’s Electric Vehicle Buyers: Why

are Some Consumers Abandoning Electric Vehicles?” (Research Report, University of California, Davis, National

Center for Sustainable Transportation), Published April 1, 2021.

139

PIA 2021. Plug in America, “Satisfied Drivers, Optimistic Intenders”, Published February 2021.

140

Consumer Report 2021.

141

Ellencweig et al 2019. Ben Ellencweig, Sam Ezratty, Dan Fleming, and Itai Miller, “Used Cars, New Platforms:

Accelerating Sales in a Digitally Disrupted Market”, Mckinsey & Company, Published June 2019.

142

Ellencweig et al 2019.

143

Canepa et al 2019. Canepa, K., Hardman, S., & Tal, G. An early look at plug-in electric vehicle adoption in

disadvantaged communities in California. Transport Policy (June 2019), 78, 19–30.

https://doi.org/10.1016/j.tranpol.2019.03.009 Accessed January 31, 2022.

144

Edmunds 2018. Ronald Montoya, “The Pros and Cons of Buying a Used EV”, Edmunds, Published 5, March

2018.

While California leads the nation in electric vehicle sales

145,146

, interest levels in the broader

U.S. appear to be lower among new vehicle shoppers with about as many people reluctant

to buy electric vehicles as there are interested.

147,148,149

Even so, the opportunity to convert

buyers is great since research shows that 59-percent of new-vehicle shoppers in the U.S.

seem to be on the cusp, falling into the “somewhat likely” or “somewhat unlikely” categories

of considering an electric vehicle for their next purchase or lease.

150

With “lack of

information” a known cause of hesitation, better informing shoppers about electric drive

vehicles combined with the already rapidly expanding model offerings of long-range electric

cars in market segments that consumers care most about is likely to have a substantial effect

on interest. Consumer research will continue to be essential in identifying the greatest

motivators to adopt clean technologies.

For buyers with little enthusiasm for electric drive, research indicates the following actions

will increase interest: increasing access to charging, increasing driving range, reducing cost,

broadening the diversity of models to meet more of consumers’ needs, achieving parity in

quality with ICEVs, and increasing education about the benefits of electric vehicles.

Mainstream consumers may be less forgiving of inconveniences than their earlier electric

vehicle adopter counterparts.

151

Research indicates that increased education and experience will translate to increased

electric vehicle interest, and that “lack of information” is one reason why more people are

not considering going electric.

152,153,154

Well-funded, sustained strategic campaigns and

experiential marketing can go a long way in building intrinsic demand for electric vehicles.

Those who buy used vehicles also need more tools and knowledge to move them from the

ICEV to ZEV purchase. Used car buyers lag in awareness of ZEVs and incentives, and they are

less likely to say they have noticed public charging available to them. They also do much

more online research – 40-percent more – than new car buyers,

155

and they rely much less on

the salesperson, and more on their own research. This means acceptance of electric vehicles

in the used market will require serving the information needs of used car buyers.

Aside from consumer knowledge and perception, and vehicle performance, another

important area to address is expanding access to at-home charging. Research is clear that

most current electric vehicle owners are satisfied and will likely re-purchase a vehicle with

145

Veloz 2022. Veloz, “Electric Vehicle Sales in California and the U.S.” (Quarterly Dashboard from California

Energy Commission Data), Accessed February 23, 2022.

146

NREL 2021a. National Renewable Energy Laboratory, “Electric Vehicle Registrations by State”, Published

June 2021.

147

Green Car 2020, Green Car Congress. “Continental Mobility Study 2020 Finds People Still Have Doubts

About EVs”, Published January 8, 2021.

148

J.D. Power 2021b. JD Power, “Battleground for Electric Vehicle Purchase Consideration is Wide Open, J.D.

Power Finds“ (Press Release), Published February 25, 2021.

149

MacInnis 2020. MacInnis, Bo, and Jon A. Krosnick, “Climate Insights 2020: Electric Vehicles”, Washington,

DC: Resources for the Future, Accessed January 24, 2022.

150

J.D. Power 2021b.

151

Hardman 2021.

152

Pew 2021. Alison Spencer and Cary Funk, “Electric Vehicles Get Mixed Reception From American

Consumers”, Pew Research Center, Published June 3, 2021.

153

J.D. Power 2021a.

154

Consumer Report 2021.

155

Ellencweig et al 2019.

clean technology. However, for the approximately 20-percent who returned to traditional

gasoline vehicles, the research indicates that charging was the major factor in dissatisfaction

with the technology.

156

In particular, lack of fast at-home charging (often referred to as “Level

2”)

157

remains both a frustration and an overall barrier to electric vehicle uptake. This is

especially true for under-resourced car buyers and those living in multi-unit or rental housing

as they may be required to rely more on public charging,

158,159

which is generally more

expensive, less reliable, and tends to be less available in less privileged neighborhoods.

160

Vehicle durability and longevity are among the factors integral to instilling consumer

confidence in ZEVs in both the new and secondary vehicle markets to ensure that these kinds

of vehicles are purchased and operated - and thus displace emissions from conventional

vehicles. Many car buyers view electric vehicles as lacking compared to traditional gasoline

options, in terms of higher costs (real or perceived), fewer mechanics available and trained to

fix issues, and faster depreciation.

161

For example,

Nearly one-third (29%) of Americans believe that maintaining EVs is more costly than

maintaining gasoline-powered cars, and these individuals may be less open to

purchasing an EV then the 13% and 50% of Americans who believe that maintenance

of all-electric cars is less costly than or as costly as maintaining gasoline-powered cars,

respectively.

162

Similarly, almost a third of Americans think that few to almost no mechanics are trained to

service and repair electric vehicles.

163

To address consumer confidence, consumers should be

guaranteed the same protections for electric vehicles to which they are accustomed in

gasoline vehicles.

Additionally, the early adopter ZEV market has been mostly made up of higher-income

individuals with high levels of education. When counting both new and used vehicle

purchases, households earning less than $100,000 per year represent 72-percent of gasoline

vehicle purchases, but only 44-percent of electric vehicle purchases.

164

Among used vehicle

buyers, the median income of electric vehicle buyers in California is $150,000, compared with

156

Hardman 2021.

157

Additional information about Level 2 charging by U.S. DOE here:

https://afdc.energy.gov/fuels/electricity_infrastructure.html#level2

158

CEC 2022b. Alexander, Matt. 2022. Home Charging Access in California. California Energy Commission.

Publication Number: CEC-600-2022-021. https://www.energy.ca.gov/sites/default/files/2022-01/CEC-600-2022-

021.pdf

159

Consumer Reports 2020.

160

NREL 2021b. Yanbo Ge, Christina Simeone, Andrew Duvall and Eric Wood, “There’s No Place Like Home:

Residential Parking for the Future of Electric Vehicle Charging Infrastructure”, National Renewable Energy

Laboratory, Published October 2021.

161

MacInnis 2020.

162

MacInnis, 2020, p. 7.

163

MacInnis, 2020, p. 8.

164

Muehlegger et al 2018. Muehlegger, E., and Rapson, D. Understanding the Distributional Impacts of Vehicle

Policy: Who Buys New and Used Alternative Vehicles? https://escholarship.org/uc/item/0tn4m2tx February

2018. Accessed January 31, 2022.

$90,000 for gasoline vehicle buyers.

165

Some of the disparity in adoption by income is due to

the fact that many ZEV and PHEV models on the market are luxury vehicles. This disparity in

buyer income levels will continue to be an important barrier to address for the State to

successfully electrify all light-duty vehicles.

6. Complementary Policies: Equitably Building a Successful ZEV Market

Transforming to a zero-emission transportation system equitably requires a coordinated,

collaborative, and cross-cutting approach. This involves many different policies and programs

from international, national, state and local agencies as well as public-private partnerships

and commitments from the private sector. California’s ZEV regulation is one piece of the

overarching strategy. Although outside the scope of this rulemaking and impact assessment,

a comprehensive set of complementary programs and policies are being implemented by

many state agencies to address what is needed for a successful ZEV market. In addition to

the ZEV regulation, California agencies are focused on several priorities:

• Development of a robust recharging and refueling network

• Implementation of a suite of incentive programs for clean cars, funding for charging,

and fueling options

• Partnerships with key organizations for enhanced outreach and education to ensure

consumers know the benefits of electric drive vehicles and how those vehicles will

meet their transportation needs

• Implementation of equity-focused programs that increase access to and use of ZEVs

• A variety of other efforts to address barriers to large-scale uptake of electric vehicles

As California agencies develop the policies and programs needed to ensure a successful

transition to electric transportation it is critical that environmental justice communities benefit

equitably from this transition. In addition to the ACC II regulations, statewide actions need to

include significant increases in funding for targeted incentives and infrastructure

development, as well as more directed equity actions from private industry. Further, it is

important that the lens for transportation equity extend beyond cars to embrace policies and

tools that reduce the need for personal vehicles and extend to walkability and transit as well.

Thus, while regulating manufacturers through rulemakings such as ACC II can do much to

ensure ZEVs are available and durable, other policy tools are also important.

Regulations, incentives, and supporting programs work together to accelerate the ZEV

market by fostering demand that leads to a growing supply that reduces costs across all

phases of ZEV technology commercialization and market development. Incentives that bring

down the higher up-front costs of electric vehicles are important and effective at all income

165

Turrentine, et al 2018. Turrentine, T., Tal, G., & Rapson, D. The Dynamics of Plug- in Electric Vehicles in the

Secondary Market and Their Implications for Vehicle Demand, Durability, and Emissions.

https://ww2.arb.ca.gov/sites/default/files/classic/research/apr/past/14-316.pdf April 2018. Accessed January 31,

2022.

levels, while maximizing affordability and access for under-resourced drivers and

overburdened communities.

166

a) California Complementary Policies

California supports this emerging market in many ways. Twenty-eight state agencies,

including the California Energy Commission (CEC), Department of General Services, and

Caltrans, have policies and programs that support a zero-emission transportation future. In

addition, the Governor’s Office of Business and Economic Development (GO-Biz), in

collaboration with other California state government agencies, has developed a ZEV Market

Development Strategy

167

that outlines how those agencies and stakeholder groups key to our

transition can move together with the scale and speed required to reach the state’s ZEV

targets.

168

To equitably support this transition, as part of the 2022 state budget, Governor Newsom has

proposed an additional $6.1 billion in new zero-emission transportation investments over four

years to increase access to clean transportation, reduce air pollution, and support

disadvantaged and low-income communities, including many tribal communities. This

includes $256 million for low-income consumer vehicle purchases incentives, $900 million to

expand affordable and convenient ZEV infrastructure access in low-income neighborhoods,

and $419 million to support sustainable, community-based transportation equity projects that

increase access to zero-emission mobility in disadvantaged and low-income

communities. This proposal builds upon the $3.9 billion approved in the 2021 Budget

Act to deliver a combined $10 billion investment in the critical window between 2021 and

2026 to accelerate the equitable transition to zero-emission transportation for all

Californians.

169

Locally, there are many California “ZEV ready” cities that have taken steps and enacted

policies to encourage ZEVs in their region. These include installation of public electric vehicle

charging infrastructure, streamlined infrastructure permitting processes and provision for

local incentives and infrastructure funding.

170

In 2021, local actions continued to expand

through more than $18 million in ZEV readiness grants by the CEC. There are now 15 ZEV

readiness regions across California and several cities with a ZEV Community Blueprint.

171

encourage more counties to streamline their permitting processes for electric vehicle

166

Archsmith et al 2021. James Archsmith, Erich Muehlegger & David S. Rapson, “Future Paths of Electric

Vehicle Adoption in the United States: Predictable Determinants, Obstacles and Opportunities”, Published July

6, 2021.

167

GO-BIZ 2021. Governor’s Office of Business and Economic Development. “California Zero-Emission Vehicle

Market Development Strategy” https://static.business.ca.gov/wp-

content/uploads/2021/02/ZEV_Strategy_Feb2021.pdf Published February 2021. Accessed February 11, 2022.

168

GO-BIZ 2022a. California Governor’s Office of Business and Economic Development. 2022. “Agency ZEV

Action Plans.” Accessed March 10, 2022. https://business.ca.gov/industries/zero-emission-vehicles/zev-

strategy/agency-zev-action-plans/.

169

GO 2022. 2022-2023 Governor’s State Budget Summary pages 82-83, January 10, 2022. Accessed February

11, 2022. https://www.ebudget.ca.gov/2022-23/pdf/BudgetSummary/FullBudgetSummary.pdf

170

OPR 2022. Governor’s Office of Planning and Research https://opr.ca.gov/planning/transportation/zev.html

Accessed February 11, 2022.

171

CEC 2021a. 2021–2023 Investment Plan Update for the Clean Transportation Program, California Energy

Commission, December 2021 https://www.energy.ca.gov/publications/2021/2021-2023-investment-plan-

update-clean-transportation-program Accessed February 11, 2022.

charging stations, GO-Biz launched the Permitting Olympics in 2020 and continues to

recognize counties where permitting is streamlined.

172

Public-private partnerships are also key to expanding the ZEV market in California. For

example, CARB is a founding member of two public-private partnerships working to increase

the ZEV market in California: Veloz and the California Fuel Cell Partnership. Veloz works to

support consumer awareness and accelerate uptake of ZEVs. Veloz’s “Electric For All”

consumer awareness campaign and the associated electric vehicle consumer shopping tool

ElectricForAll.org launched in 2018 to inform consumers about ZEVs and has reached millions

of consumers to date. The next iteration of the Electric For All campaign will launch in

2022.

173,174,175

The California Fuel Cell Partnership is focused on growing the market for

FCEVs and hydrogen fuel.

176

Automotive manufacturers, energy providers, and government

agencies collaborate on ideas and actions that will create a sustainable future for zero-

emission cars, heavy-duty trucks, and buses.

1) California Plug-In Electric Vehicle Infrastructure

Battery- and PHEVs drivers charge their vehicles by plugging in and accessing grid energy.

Like these electric vehicles, electric vehicle charging infrastructure and electric vehicle supply

equipment (EVSE) has quickly evolved and grown in availability to meet demand. Since the

adoption of ACC, network planning for better EVSE placement has developed, along with

increased funding for charging stations. This section will summarize public and private actions

being taken to accelerate ZEV charging infrastructure across California, and how public

investment and regulations are working to address barriers in support of this proposed

vehicle regulation.

Several broad state planning efforts are in place to guide the State role of supporting the

market expansion. This includes the coordination effort by the Governor’s Office of Business

and Economic Development, and their multi-agency ZEV Market Development Strategy.

177

This effort aims to coordinate state actions to support the market, and to help jump-start

new actions that may be necessary. CEC is also developing a focused ZEV Investment Plan

(ZIP) to help guide publicly funded infrastructure investment strategies generally.

178

developing this proposed vehicle regulation, CARB staff have consulted with CEC and CPUC

for their feedback on energy and fuel infrastructure impacts, but also for the other agencies

to understand the ZEV fleet implications in their programs. This coordination ensures the

172

GO-BIZ 2022b. Governor’s Office of Business and Economic Development. Permitting Olympics

https://business.ca.gov/industries/zero-emission-vehicles/plug-in-readiness/permitting-olympics/ Accessed

February 11, 2022.

173

Veloz 2019. Veloz Opposites Attract Campaign Summary, October 22, 2019, Microsoft Word -

191018_opposites_attract_summary.docx (electricforall.org) Accessed February 11, 2022.

174

Veloz 2020. Veloz Electric For All Kicking Gas Campaign, June 16, 2020 Microsoft Word -

Kicking_Gas_Campaign.docx (electricforall.org) Accessed February 11, 2022.

175

Veloz 2021. Veloz 2020-2021 Annual Report, 2020 – 2021 Veloz Annual Report - Veloz Accessed February 11,

2022.

176

CAFCP 2022a. “About Us” California Fuel Cell Partnership Website. https://cafcp.org/about_us Accessed

February 7, 2022.

177

GO-BIZ 2021.

178

CEC 2022c. California Energy Commission, (Workshop) ZEV Infrastructure Plan, Accessed February 22, 2022

https://www.energy.ca.gov/event/workshop/2022-01/workshop-zero-emission-vehicle-infrastructure-plan

proposed regulations avoid or at least minimize duplicative or inconsistent regulatory

requirements that may affect electricity and natural gas providers.

179

To help inform public and private investments in the coming years, AB 2127, the Electric

Vehicle Charging Infrastructure Assessment, called for and directed the CEC to examine how

much charging infrastructure would support 5 million ZEVs by 2030.

180

In response to AB

2127, the CEC compiled a report to track progress of California’s electric vehicle goals and

summarize the installed, planned, and projected public plug-in infrastructure.

181

Table III-1

summarizes the CEC assessment regarding chargers installed, planned, and projected to

support the 2025 and 2030 state goals. The planned infrastructure to be installed by 2025 is

based on state funding, rate-payer funding, and settlement agreements. Large private sector

investments are also occurring from EVSE providers and automakers and are expected to

help contribute towards achieving the projections shown in Table III-1. Staff expect private

investments in public charging to grow with demand, with innovative partnerships emerging

to support driver needs (such as between automaker and EVSE network providers); indeed,

increasing ZEV mandates, like those proposed here, will provide further strong incentives to

private and public sector actors to further develop charging and fueling infrastructure to

match. As described below, state and federal public investments, electric utility investments,

and planning to support electric vehicle infrastructure, is also growing to augment private

investments.

Table III-1: California Public EV Charger Installations and Projections Through 2030*

Charger

type

Infrastructure

installed in

2021

Planned

infrastructure

by 2025

Estimated

additional

infrastructure to

support 1.5 million

ZEVs in 2025

Estimated

additional

infrastructure to

support 5 million

ZEVs in 2030

DCFC 7,158 2,412 430 24,000

Level 2 71,236 111,795 56,969 690,000

Total 78,394 114,207 57,399 714,000

179

Health and Safety Code §§ 38501, subd. (g), 38562, subd. (f). Examples of consultation include a CPUC

public workshop on May 9, 2019, and the ACCII CARB public workshop on Oct 13, 2021.

180

Ting, Chapter 365, Statutes of 2018

181

CEC 2021b. Alexander, Matt, Noel Crisostomo, Wendell Krell, Jeffrey Lu, and Raja Ramesh. July 2021.

Assembly Bill 2127 Electric Vehicle Charging Infrastructure Assessment: Analyzing Charging Needs to Support

Zero-Emission Vehicles in 2030 – Commission Report. California Energy Commission. Publication Number: CEC-

600-2021-001-CMR. https://efiling.energy.ca.gov/GetDocument.aspx?tn=239615

* Installed values from the CEC Dashboard

182

; Planned infrastructure values derived using

CEC’s AB 2127 report values for planned infrastructure by 2025 minus recent installed

chargers; Additional projections from the AB 2127 report values for 2025 and 2030.

The majority of drivers today charge their vehicles at home and supplement their energy

needs from public charging. Staff expect this trend to continue but with a growing share of

drivers using public charging infrastructure as more and more drivers reside in apartments

and rental properties without access to home charging.

183

Given home charging is the most

convenient and usually the least-cost source of electricity for charging, CARB strives to help

increase access to this service. For several years, CARB staff have recommended changes to

the state’s building code requirements for new construction of residential buildings. In this

advisory capacity, the California Department of Housing and Community Development (HCD)

has adopted increased home charging requirements through the CALGreen code.

184

Additionally, the proposed requirement of automakers to provide convenience charging

cords aims to provide electric vehicle drivers with more options for home charging.

Beyond charging network planning, in 2019, CARB adopted regulations

185

required by the

Electric Vehicle Charging Stations Open Access Act, which required open access and

transparent payment systems for public EVSE.

186

The goal of this statute and subsequent

regulation is to reduce barriers to electric vehicle drivers by making the electric charging

experience more seamless, and available to all California drivers. This includes requirements

for multiple forms of payment systems at charging stations and prohibits public charging

stations to be restricted to specific memberships. As this regulation is being implemented by

CARB, on-going market assessments are occurring to better understand barriers to charging

by drivers, with an emerging awareness of station reliability as an issue.

187

CARB and CEC

staff collaborate on ways the state can help address reliability challenges.

2) California Public Investment in Electric Charging Infrastructure

California’s continued funding has played a key role in advancing the deployment rate of

EVSE throughout the state, and it will be increasingly important to support driver fueling

needs with this proposed vehicle regulation. Along with private investments made in

charging infrastructure development, the State has continued to invest to accelerate the

deployment of charging infrastructure throughout California. In recent years, approximately

$710 million has been spent to install EVSEs in California with an additional $2.65 billion-

$2.69 billion anticipated to be invested through various public investments which are

detailed below. Of this amount, $1.284 billion has only recently been committed or proposed

in the federal Infrastructure Investment and Jobs Act and Governor Newsom’s proposed

182

CEC 2022d. “California Energy Commission Zero-Emission Vehicle and Infrastructure Statistics.” California

Energy Commission. Data last update 01/31/2022. Retrieved 02/08/2022, CEC ZEV Statistics Dashboard.

183

ICCT 2019. Nicholas, Michael, Dale Hall and Nic Lutsey, Quantifying the Electric Vehicle Charging Gap

Across U.S. Markets. International Council on Clean Transportation: 2019. ICCT Charging Report

184

CCR, title 24, Part 11.

185

CCR, title 13, sections 2360 through 2360.5

186

Health & Saf. Code, § 44268, et seq.; SB 454, stats. 2013, ch. 418, Corbett.

187

CARB 2022b. California Air Resources Board. 2022. Electric Vehicle Supply Equipment Standards Technology

Review. Published February 2022. https://ww2.arb.ca.gov/sites/default/files/2022-

02/EVSE%20Standards%20Technology%20Review%204Feb22.pdf Accessed March 1, 2022.

2022-23 budget. This additional anticipated funding will help build charging stations that are

to be installed by 2025 and help work towards the projections identified in the CEC AB 2127

report, shown in Table III-1. Note that these investment estimates do not include private

investment from EVSE providers, like Tesla’s charging network.

The CEC 2021–2023 Investment Plan Update for the Clean Transportation Program (CTP)

proposed allocating funds for light-duty charging infrastructure deployment in the amounts

of $30.1 million allocated for fiscal years 2021-22 and 2022-23 and $13.8 million for fiscal

year 2023-24

188

. The CEC’s Clean Transportation Program has previously invested in light-

duty electric vehicle charging infrastructure for over 13 years for a total investment of $192.6

million

189

. The CTP has many goals, one of which is to ensure that its investments benefit

priority communities including those that are disadvantaged, low-income, and rural. The CTP

Advisory Committee was reconstituted to include broader representation of rural

communities, tribes, and others. As part of the CTP, the CEC has engaged with priority

communities through a workshop on light duty charging infrastructure that can serve

residents in rural and multifamily housing.

190

The CEC also granted two block grants of up to $250 million each to design and implement

light-duty electric vehicle charger incentives for rapid deployment of chargers, to be

administered by the Center for Sustainable Energy and CALSTART. Along with these

investments, $240 million in general funds were allocated to CEC for fiscal year 2021-2022

from the Budget Act of 2021 for ZEVs and infrastructure, which will fund light-duty electric

vehicle charging infrastructure.

Large investments are also occurring through the CPUC’s Transportation Electrification

project approvals for utility expenditures as directed by statute, which have authorized $756

million for light-duty charging infrastructure of which $245 million has been spent

191

. These

programs are required to reduce dependence on petroleum, increase the adoption of zero-

emission vehicles, help meet air quality standards, and reduce greenhouse gas emissions

toward the SB 32 goal of 40% GHG emission reductions by 2030. Through Senate Bill 350,

the CPUC and CEC established the Disadvantaged Communities Advisory Group comprising

11 members that advise and review programs and policies to ensure that disadvantaged

communities benefit from State investments in transportation electrification.

192

The CEC has

allocated funds to ensure disadvantaged communities benefit from investments made

through the Clean Transportation Program. According to the 2021–2023 Investment Plan

Update for the Clean Transportation Program, the CEC will seek to ensure that more than 50

percent of the funds from the Clean Transportation Program will benefit low-income and

disadvantaged communities. Approximately 51 percent of awarded project funds from the

188

CEC 2021a

189

CEC 2021a

190

CEC 2021a

191

CPUC 2021. “Approved TE Investments.” California Public Utilities Commission. January 26, 2021, CPUC

Transportation Electrification Website. Directing authority from SB 350, statutes of 2015, De Leon.

192

CPUC 2022a. Disadvantaged Communities Advisory Group (ca.gov). https://www.cpuc.ca.gov/industries-

and-topics/electrical-energy/infrastructure/disadvantaged-communities/disadvantaged-communities-advisory-

group. Accessed February 17, 2022.

Clean Transportation Program have been within disadvantaged and/or low-income

communities.

193

The federal Infrastructure Investment and Jobs Act of 2021 allocated $384 million over five

years to support the expansion of the electric vehicle charging network.

194

The Governor’s

2022-2023 budget proposed $600 million for ZEV fueling infrastructure grants, and $300

million for equitable at-home charging for light-duty vehicles

195

Finally, Electrify America is investing $800 million over ten years in California as required by

Appendix C of the Volkswagen Consent Decree.

196

The program is divided into four

investment cycles of $200 million each to support increased ZEV technology adoption. To

date, Electrify America has allocated $273 million to ZEV infrastructure in Cycles 1

197

and 2

198

and approximately $127 million additional investment to be spent in Cycle 3

199

which began in

January of 2022 and will conclude in June of 2024. Further, Electrify America, as directed by

Senate Bill 92 (Committee on Budgets and Fiscal Review, Chapter 26, Statutes of 2017) and

CARB Resolution 17-32, is to strive to ensure that at least 35 percent of their ZEV Investment

Plan funds benefit disadvantaged and low-income communities. Electrify America has begun

implementing its Cycle 3 ZEV Investment Plan and will strive to ensure that 35% of its

investments will be in disadvantaged and low-income communities, as it has done for Cycles

1 and 2.

Taken together, these public and private actions demonstrate commitment to development

of charging infrastructure across California. While the projections as shown in Table III-1 are

substantial, public and private investment in recent years have accelerated. The State

investments and programs currently underway are expected to make strong contributions

towards addressing infrastructure growth for ZEV drivers in a manner that complements

private investments and works to ensure convenient charging access for all California drivers.

3) California Electric Grid to Support EV Charging Infrastructure

Electric vehicles will rely on the electric grid to provide consistent, on-demand power to

charge vehicles. With the light duty market described in this proposal, and the introduction

of medium- and heavy-duty electric vehicles, the electric grid will have to expand and adapt

rapidly to meet a new and more extensive demand.

Historically, the state’s electric grid has expanded and evolved as consumer demand for

electricity services has grown, including with the recent emergence of plug-in electric

vehicles. California’s existing grid and approved investments occurring now will allow the

state to handle millions of electric vehicles in the near-term, and projections show the

193

CEC 2021a.

194

White House 2021a. White House, United States. 2021. The Infrastructure Investment and Jobs Act will

Deliver for California. White House IIJA California Fact Sheet.

195

Gov 2022. Office of Governor Gavin Newsom, Governor’s Budget Summary (2022), 2022 California

Governor’s Proposed Budget Summary.

196

CARB 2022c. California Air Resources Board.” Volkswagen Zero-Emission Vehicle (ZEV) Investment

Commitment “. https://ww2.arb.ca.gov/our-work/programs/volkswagen-zero-emission-vehicle-zev-investment-

commitment

197

VW 2017. Volkswagen Group of America. 2017. California ZEV Investment Plan: Cycle 1. Cycle 1 Plan Report.

198

EA 2018. Electrify America 2018. California ZEV Investment Plan: Cycle 2. Cycle 2 Plan Report.

199

EA 2021. Electrify America 2021. California ZEV Investment Plan: Cycle 3. Cycle 3 Plan Report.

broader western grid can handle up to 24 million electric vehicles without requiring any

additional power plants.

200

However, electrification of California’s entire transportation

sector, particularly when combined with increased electrification of the state’s building stock,

will require further investments in transmission and local distribution systems and

coordinated grid planning efforts.

Longer term, transitioning to 100% passenger vehicle electrification is achievable with a

gradual build out of clean energy resources - more gradual than during times of peak

electricity sector growth in the past given electric vehicle loads can be distributed over non-

peak hourly periods. Several studies have shown no major technical challenges or risks have

been identified that would prevent a growing electric vehicle fleet at the generation or

transmission level, especially in the near-term.

201 202

Additionally, based on historical growth

rates, sufficient energy generation and generation capacity is expected to be available to

support a growing electric vehicle fleet.

203

State agencies and electric utilities have begun proactively planning for electrical distribution

upgrades and new load for electric vehicles via statewide energy system planning processes,

including the CEC’s Integrated Energy Policy Report (IEPR) forecasting, California

Independent System Operator (CAISO) transmission planning, and the CPUC’s Integrated

Resource Plan (IRP) proceeding for 10-year grid enhancement strategies. Additionally, recent

policy changes allow investor-owned utilities in California to establish rules and tariffs under

general rate case proceedings for electrical distribution infrastructure on the utility side of

the meter to support transportation electrification charging stations.

204

The CPUC has already approved utility investments for upgrading the electric grid along with

electricity rate changes to fund those investments.

205

The CPUC approved time-of-use (TOU)

rates which provides signals to electricity rate changes at different times of the day that

would impact the cost to fuel for electric vehicle drivers that charge at home. This decision

was made to optimize grid resources, maintain grid reliability, and provide reasonable rates

for residential EV charging.

206

The CPUC also opened a new proceeding to modernize and

prepare the grid in anticipation of multiple distributed energy sources.

207

With this new

200

PNNL 2020. Kintner-Meyer, Michael, et al. July 2020. Electric Vehicles at Scale – Phase I Analysis: High EV

Adoption Impacts on the Western U.S. Power Grid. Pacific Northwest National Laboratory.

https://www.pnnl.gov/sites/default/files/media/file/EV-AT-SCALE_1_IMPACTS_final.pdf

201

US DRIVE 2019. U.S. DRIVE. 2019. Summary Report on EVs at Scale and the U.S. Electric Power System. U.S.

Driving Research and Innovation for Vehicle Efficiency and Energy Sustainability (DRIVE). November 2019.

Accessed March 10, 2022.

https://www.energy.gov/sites/prod/files/2019/12/f69/GITT%20ISATT%20EVs%20at%20Scale%20Grid%20Summ

ary%20Report%20FINAL%20Nov2019.pdf

202

Muratori et al 2021. Matteo Muratori et al 2021 Prog. Energy 3 022002. “The rise of electric vehicles—2020

status and future expectations.” 25 March 2021. https://iopscience.iop.org/article/10.1088/2516-

1083/abe0ad/pdf

203

DOE 2019

204

AB 841 (Ting 2020)

205

CPUC 2022b. “Transportation Electrification.” California Public Utilities Commission. January 26, 2022,

CPUC’s Transportation Electrification Website.

206

CPUC 2022c. “Electricity Rates and Cost of Fueling.” California Public Utilities Commission. January 26,

2022, CPUC’s Charging Rates Website.

207

CPUC 2022d. California Public Utilities Commission. Proposed Decision: Order Instituting Rulemaking to

Modernize the Electric Grid for a High Distributed Energy Resources Future. January 26, 2022. CPUC’s

Proposed Rulemaking for Distributed Energy Resources.

proceeding, the CPUC aims to evolve grid capabilities to integrate distributed energy

sources including electric vehicle charging, EV charging forecasts to improve distribution

planning, and community input to optimize infrastructure investments for the grid.

208

One of the key goals of this proceeding is to improve distribution planning, including

charging infrastructure forecasting to support cost effective and widespread transportation

electrification. In parallel, CEC staff is developing the EVSE Deployment and Grid Evaluation

(EDGE) tool, which currently uses the IOUs’ Integration Capacity Analysis (ICA) map data to

understand existing grid conditions and capacity. EDGE will not only help stakeholders

identify suitable locations for charger deployments, but also act as an early warning system

for utilities and grid planners to identify locations where grid upgrades may be required to

support high charging demand.

In most circumstances, electric vehicles do not draw energy at the same time they are

operating, and charging time is usually much shorter than vehicle dwell time. This provides

light-duty electric vehicles with the flexibility to charge at times that are less impactful to the

grid and at times of abundant renewable generation availability. CEC’s AB 2127 report

presented an analysis of electricity consumption due to electric vehicle charging using the

Electric Vehicle Infrastructure Projection tool (EVI-Pro 2).

209

EVI-Pro 2 is a simulation model

used by the CEC to estimate the number, type, and location of chargers needed in California

to support light-duty BEV and PHEV drivers, and projects time-of-day charging profiles.

Electric vehicles will add power loads to the grid, but if the demand occurs during hours

when there is excess electricity supply, less investment is needed from new supply

generation.

210

Innovative solutions are emerging to help support charging infrastructure and manage loads

at the local grid level. Since ZEVs are a unique electric load and are potentially advantageous

compared to other types of load, state agencies and utilities are also actively planning for

vehicle-to-grid integration (VGI) services. These VGI services range from bi-directional

charging (V2X) to one-directional passive load shifting by price signals or rate design. Load

shifting is valuable to the state to control peak loads by shifting a large portion of charging

loads to hours that are less impactful to the grid. Load shifting strategies are also easy to

implement for electric utilities and for public consumers and allow for better integration of

renewable energy. Models suggest that electric vehicle charging can reduce renewables

curtailment, which is when the output of a renewable energy resource is intentionally

reduced below what it could produce,

211

anywhere from 25 to 90 percent.

212

As VGI services

move into bi-directional charging (V2X), where the power can flow to and from the vehicle

battery, the benefit to the grid is greater with the potential to offset grid upgrades and

further reduce overall strain at peak usage times. Bi-directional services can also provide

emergency backup services in the event of grid shutoffs or general power failures. Overall,

208

CPUC 2022e. “CPUC Takes Action to Modernize Electric Grid for High Distributed Energy Resources

Future.” California Public Utilities Commission. January 26, 2022, CPUC Summary of Distributed Energy

Resource Proceeding.

209

CEC 2021c. Alexander, Charging Infrastructure Assessment, 2021. Chapter 4, Section- EVI-Pro 2 details

methodology and additional information regarding analysis to obtain the grid impacts by 2030.

210

CEC 2021c.

211

https://www.caiso.com/documents/curtailmentfastfacts.pdf

212

PNNL 2020

VGI services create opportunities to reduce system costs and facilitate renewable energy

integration, and electric vehicle resource adequacy can be doubled with these managed

charging strategies.

213 214 215

With the benefits electric vehicles can provide to the grid, state agencies in California have

continued to collaborate on policies and programs to enable this integration. The CEC,

CAISO, CPUC, CARB, and other stakeholders are working to update the state’s roadmap to

integrate electric vehicle charging needs with the needs of the electrical grid. The update will

reflect advancements in VGI technology and include actions the state can take to advance

California’s transportation electrification goals. Separately, in December 2020, the CPUC

adopted a decision on VGI which created metrics and strategies for advancing VGI and

authorized almost $40 million for the investor-owned utilities to spend piloting VGI

technologies and programs. In November 2021, the CPUC adopted a resolution creating a

pathway for alternating current (AC) interconnection for VGI and allowing some electric

vehicles to enable bidirectional mode more easily. The CPUC is continuing to consider

streamlining procedures for both charging and bidirectional interconnections.

As the electric vehicle market expands, electricity demand will increase to provide the

charging needs for these vehicles. To meet this anticipated demand, State agencies and

electric utilities have begun planning and putting in place programs for electrical distribution

upgrades. Although an increase in electricity demand is anticipated with the widespread

adoption of electric vehicles, electric vehicles can aid in managing grid resources and can

improve resilience of the grid.

4) California Hydrogen Infrastructure Development and Funding

California has long provided support for the advancement of hydrogen fueling station

technology and developing a fueling network. Early efforts like the California Hydrogen

Highway and California Blueprint Plan set the stage for today’s hydrogen fueling station

designs and operation, network buildout strategies, and public-private collaborative efforts.

These efforts enabled the launch of an FCEV market in California. The CEC estimates that

9,647 FCEVs are on the road as of the end of September 2021,

216

and industry estimates

show 12,187 cumulative sales as of November 2021.

217

Recently announced State and

federal efforts will further support the development of hydrogen production and fueling

infrastructure.

218

In January 2022, the Office of Governor Newsom published a proposed

budget for fiscal year 2022-2023 and included $6.1 billion for ZEV infrastructure

213

PNNL 2020

214

IRENA (International Renewable Energy Agency) 2019, Innovation Outlook: Smart charging for Electric

Vehicles (Abu Dhabi: International Renewable Energy Agency). https://www.irena.org/-

/media/Files/IRENA/Agency/Publication/2019/May/IRENA_Innovation_Outlook_EV_smart_charging_2019.pdf

215

Zhang et al 2018a. Zhang J, Jorgenson J, Markel T and Walkowicz K 2019, “Value to the grid from managed

charging based on California's high renewables study” IEEE Trans. Power Syst. 34 831–40.

216

CEC 2021d. Baronas, Jean, Belinda Chen, et al. 2021. Joint Agency Staff Report on Assembly Bill 8: 2021

Annual Assessment of Time and Cost Needed to Attain 100 Hydrogen Refueling Stations in California.

California Energy Commission and California Air Resources Board. Publication Number: CEC-600-2021-040.

217

CaFCP 2022b. “By The Numbers.” California Fuel Cell Partnership. January 25, 2022, CAFCP By the

Numbers Webpage.

218

GO 2022.

development, which would include hydrogen fueling infrastructure for light-, medium- and

heavy-duty vehicles.

California’s supporting incentive programs and strong policy direction have been primary

drivers for network growth. AB 8 provides up to $20 million per year through the end of 2023

to co-fund the development of hydrogen fueling stations through the CEC’s Clean

Transportation Program.

219

In addition, in 2019, CARB’s Low Carbon Fuel Standard (LCFS)

adopted provisions to enhance support for the deployment of hydrogen fueling stations

through its Hydrogen Refueling Infrastructure credit pathway.

220

Due to these efforts, California has launched the nation’s largest retail hydrogen fueling

station network, which began operations in 2015

221

and is projected to significantly expand

through the end of this decade. There are currently 50

222

hydrogen fueling stations

considered open-retail (publicly available hydrogen fueling stations that provide retail sales

of hydrogen fuel and function similarly to traditional gas stations with no requirement for

membership or access agreement to fuel), and approximately 60 additional l stations planned

or currently under development through the CEC’s Clean Transportation Program.

223,224,225

The recently adopted 2021-23 Clean Transportation Program Investment Plan update

commits funds to reach a total of 200 retail hydrogen fueling stations co-funded by the

program.

226

b) U.S. Support

Beyond California, this transformation is happening with national, state, local and

international jurisdictions supporting ZEVs. At the national level, the Infrastructure Investment

and Jobs Act allocates $7.5 billion for electric vehicle infrastructure with the goal of placing

500,000 chargers across the country.

227

Of the $7.5 billion available, $5 billion will be

apportioned to states, territories, and the District of Columbia to install charging stations.

The remaining $2.5 billion will be distributed through competitive grants focused on putting

219

AB 8 2013. Assembly Bill No. 8 (Perea, Statutes of 2013, Chapter 401).

https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201320140AB8

220

CARB 2020b.California Air Resources Board. Low Carbon Fuel Standard (Unofficial Electronic Version),

January 26, 2022. LCFS Regulation Text.

221

The first station to initiate retail hydrogen fuel sales was the West Sacramento station in 2015. Several other

stations previously provided hydrogen fuel to FCEV drivers but were not able to complete retail sale

transactions due to their inability to provide sufficiently accurate metered hydrogen dispensing.

222

There are an additional 4 stations that previously achieved Open-Retail status but are temporarily considered

Non-Operational. The cause varies by each station, but all are expected to return to retail fuel sales sometime in

the future.

223

CEC 2021d

224

CARB 2021c. California Air Resources Board. 2021 Annual Evaluation of Fuel Cell Electric Vehicle

Deployment and Hydrogen Fuel Station Network Development, 2021, 2021 Annual Evaluation.

225

CaFCP 2022c. CAFCP Station Map. January 25, 2022. https://cafcp.org/stationmap. Accessed March 10,

2022

226

CEC 2021a

227

White House 2021b. White House, UPDATED FACT SHEET: Bipartisan Infrastructure Investment and Jobs

Act, August 2, 2021 https://www.whitehouse.gov/briefing-r

oom/statements-releases/2021/08/02/updated-fact-

sheet-bipartisan-infrastructure-investment-and-jobs-act/

charging stations in rural areas, improving air quality, and targeting disadvantaged

communities.

228

Finally, 16 other states have adopted or are in the process of adopting California’s ZEV

regulation, which leads to cost reductions and consumer awareness from an expanded

market. These states include Colorado, Connecticut, Maine, Maryland, Massachusetts,

Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode

Island, Vermont, Virginia, and Washington. In addition to adopting California’s regulations,

many states remain committed to further reducing emissions in line with this proposal. For

instance, Massachusetts has a goal of 100 percent ZEV sales by 2035.

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On an international

level, several countries have set ambitious ZEV targets, including Norway, the United

Kingdom, and Canada. Timelines for these targets vary widely. Norway has the most

aggressive target of 100 percent electric vehicle sales by 2025, while other countries, such as

Costa Rica and Germany, are aiming for these levels by 2050. Such targets send strong policy

signals to the market. France and Spain have codified these targets as laws that make these

targets legally binding and enforceable.

As seen above, there is a lot of positive activity from government, industry and

nongovernmental organizations that is moving California toward a successful transition to an

electric transportation future. The ACCII regulation alone will not achieve success on its own

but is one tool that works in concert with all the other complementary programs and policies

to put California on a path to full electrification.

B. Need for Proposed ZEV Regulations

As described in the 2017 Midterm Review, staff estimated minimum compliance with the

existing ZEV regulation to be nearly 8-percent of new vehicle sales as ZEVs and PHEVs by the

2025 model year.

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Manufacturers have thus far over-complied with the regulatory

requirements, already selling nearly 12-percent of new vehicles in California as ZEVs and

PHEVs in 2021 model year.

231

However, as discussed in section VII.A., at current levels, the

baseline fleet will not achieve the necessary reductions to achieve California’s long-term

criteria pollutant and GHG emission reduction goals. Without future, more stringent

regulations, the baseline shows ZEV sales reach over 20-percent in 2026 and subsequent

model years. Though this does represent growth from sales levels in 2021, it is insufficient for

achieving the deep emission reductions that are needed on the time scale required,

especially given the long lifetimes of these vehicles.

228

White House 2021c. White House, FACT SHEET: The Biden-⁠Harris Electric Vehicle Charging Action Plan

December 13, 2021. https://www.whitehouse.gov/briefing-room/statements-releases/2021/12/13/fact-sheet-

the-biden-harris-electric-vehicle-charging-action-plan/ Accessed February 11, 2022.

229

Choi 2021. Choi, Joseph. Massachusetts to require 100 percent of car sales to be electric by 2035, January 5,

2021. https://thehill.com/policy/energy-environment/532684-massachusetts-to-require-100-percent-of-car-

sales-to-be Accessed February 11, 2022.

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CARB 2017e. Appendix A: Analysis of Zero Emission Vehicle Regulation Compliance Scenarios

https://ww2.arb.ca.gov/sites/default/files/2020-

01/appendix_a_minimum_zev_regulation_compliance_scenarios_formatted_ac.pdf Released January 18, 2017.

Accessed January 28, 2022

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CEC 2022e. California Energy Commission. 2022. “New ZEV Sales in California: Sales in 2021. ZEV Sales

Share.” Accessed March 15, 2022.

As discussed in length in Section II.A., mobile sources continue to be significant contributors

to smog-forming emissions in California. Transitioning to zero-emission technology for every

on- and off-road mobile sector is essential for meeting near- and long-term emission

reduction goals mandated by statute, with regard to both ambient air quality and climate

requirements.

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This has been affirmed by every planning document released by CARB in the

last 10 years. Not only is electrification needed to reduce smog-forming emissions from

mobile sources and to protect near-roadway communities, it is also the key strategy for

achieving greenhouse gas reductions.

The ZEV regulation, as currently adopted, was never intended to and thus, fails to achieve

100-percent electrification in the timeframe needed to virtually eliminate emissions from

light-duty vehicles. As written, manufacturers are already over-complying and amassing

significant credits, which do not expire. This reduces the effectiveness of the regulation and

does not guarantee a sustained growing number of ZEVs and PHEVs. The ZEV regulation

must be updated to continue to push industry and remove barriers to adequately protect

public health and the climate. Staff’s full proposal for the 2026 and subsequent model year

ZEV regulation is described in Section III.C.

CARB has long designed its regulations and certification systems to ensure that vehicles,

including their emission controls, perform properly throughout their life. CARB has not

previously applied these measures, which include warranty, durability, and serviceability, to

ZEVs. However, to secure the emission benefits of this proposal, it is necessary to ensure

both that ZEVs fully function for their expected lifetimes and that consumers are willing and

able to purchase them both new and used. Staff therefore propose that ZEVs must meet

continuing assurance requirements throughout their lives. Staff’s full proposal of ZEV

Assurance Measures are described in Section III.D.

C. Proposed Requirements and Feasibility

1. ZEV Stringency: Annual ZEV Percentage Requirements

Currently, the ZEV regulation requires manufacturers to annually deliver for sale in California

an increasing percentage of ZEVs and PHEVs. The current regulation applies to large and

intermediate sized manufacturers responsible for approximately 98-percent of new

passenger cars and light trucks sold in California each year. In 2012, CARB approved the

latest iteration of the ZEV regulation as part of the Advanced Clean Cars rulemaking, which

increased the requirements through the 2025 model year and flat line thereafter.

Section III.A.2. and Appendix G details the market expansion of electric vehicles that has

been happening in California. However, even with this market expansion, more is needed to

meet California’s long term emission reduction goals. As noted in Section II.A and III.B.,

widespread electrification is necessary to achieve the emission reductions required from the

light duty sector. To that end, staff is proposing to require 100-percent electric vehicle sales

by 2035 model year.

Manufacturers have made significant improvements in battery technology, which has enabled

more vehicle offerings in more segments and increasing capabilities. This was the impetus for

232

CARB 2021a.

Staff’s ZEV compliance scenario updated in the 2017 ACC MTR, which showed the effect of

advanced ZEV technology and its interaction with the ZEV regulation.

233

Additionally,

technology costs have fallen significantly, namely battery costs, over the last 10 years and are

expected to continue to drop over time. This will make ZEVs cost-competitive with gasoline

vehicles in the 2030-2035 timeframe, if not sooner.

Building on 30 years of work to electrify light-duty vehicles in California, the market is clearly

poised for massive transformation. Every light duty vehicle manufacturer has made

commitments to electrify their product line.

234

For instance, in January 2021, General Motors

announced plans to become carbon neutral by 2040, including significant investments in

battery technology and a goal to shift its light-duty vehicles entirely to zero-emissions by

2035.

235

236

In March 2021, Volvo, announced plans to make only electric cars by 2030,

237

and

Volkswagen announced that it expects half of its U.S. vehicle sales will be all-electric by

2030.

238

In April 2021, Honda announced a plan to fully electrify its vehicles by 2040, with 40-

percent of its North American vehicle sales expected to be fully electric or fuel cell vehicles

by 2030, 80-percent by 2035 and 100-percent by 2040.

239

In May 2021, Ford announced that

it expects 40-percent of its global light-duty vehicle sales will be all-electric by 2030.

240

June 2021, Fiat announced a move to all-electric vehicles by 2030,

241

and in July 2021 its

parent corporation, Stellantis, announced an intensified focus on electrification across all its

brands.

242

Also in July 2021, Mercedes-Benz announced that all its new architectures would

be electric-only from 2025, with plans to become ready to go all-electric by 2030 where

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CARB 2017e.

234

A list of all manufacturer announcements can be found in Appendix G.

235

NY Times 2021. Neal E. Boudette and Coral Davenport. 2021. “G.M. Will Sell Only Zero-Emission Vehicles by

2035.” New York Times. Updated Oct. 1, 2021. Accessed March 10, 2022.

https://www.nytimes.com/2021/01/28/business/gm-zero-emission-vehicles.html.

236

Cleantechnica.com 2022. “GM Announces $7 Billion Investment in EVs, Solid-State Battery Supply Chain”

CleanTechnica.com, Tina Casey. January 26, 2022. https://cleantechnica.com/2022/01/26/gm-buries-solid-

state-ev-battery-supply-chain-lede-under-historic-7-billion-auto-news/

237

Volvo 2021. Volvo Car Group, “Volvo Cars to be fully electric by 2030,” Press Release, March 2, 2021.

https://www.media.volvocars.com/us/en-us/media/pressreleases/277409/volvo-cars-to-be-fully-electric-by-2030

Accessed February 11, 2022.

238

VW 2021. Volkswagen Newsroom, “Strategy update at Volkswagen: The transformation to electromobility

was only the beginning,” March 5, 2021. Accessed June 15, 2021 at https://www.volkswagen-

newsroom.com/en/stories/strategy-update-at-volkswagen-the-transformation-to-electromobility-was-only-the-

beginning-6875 Accessed February 11, 2022.

239

Honda 2021. Honda News Room, “Summary of Honda Global CEO Inaugural Press Conference,” April 23,

2021. Accessed June 15, 2021 at https:

//global.honda/newsroom/news/2021/c210423eng.html Accessed

February 11, 2022.

240

Ford 2021. Ford Motor Company, “Superior Value From EVs, Commercial Business, Connected Services is

Strategic Focus of Today’s ‘Delivering Ford+’ Capital Markets Day,” Press Release, May 26, 2021.

https://media.ford.com/content/fordmedia/fna/us/en/news/2021/05/26/capital-markets-day.html Accessed

February 11, 2022.

241

Stellantis 2021a. Stellantis, “World Environment Day 2021 – Comparing Visions: Olivier Francois and Stefano

Boeri, in Conversation to Rewrite the Future of Cities,” Press Release, June 4, 2021

https://www.media.stellantis.com/em-en/fiat/press/world-environment-day-2021-comparing-visions-olivier-

franois-and-stefano-boeri-in-conversation-to-rewrite-the-future-of-cities Accessed February 11, 2022.

242

Stellantis 2021b. Stellantis, “Stellantis Intensifies Electrification While Targeting Sustainable Double-Digit

Adjusted Operating Income Margins in the Mid-Term,” Press Release, July 8, 2021.

https://www.stellantis.com/en/news/press-releases/2021/july/stellantis-intensifies-electrification-while-targeting-

sustainable-double-digit-adjusted-operating-income-margins-in-the-mid-term Accessed February 11, 2022.

possible.

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More recently, Mercedes followed these announcements with a US battery plant

to power their transformation.

244

This is in addition to the unprecedented market performance

of Tesla, which has grown exponentially since its 2008 debut, and plans to expand its vehicle

line and sales volumes over the next 5 years. It has been reported that Tesla plans to deliver

the Cybertruck, Semi, and Roadster sometime in 2023, and will likely work on its lower cost

Model 2 at a future time.

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These manufacturer driven public announcements are not only in response to California and

U.S. regulations and governmental goals. As stated in section III.A.6, global jurisdictions have

set aggressive targets that call for light-duty electrification. Along with California, these goals

and regulations send a signal to manufacturers that the future is electric. And its clear

manufacturers see the writing on the wall. What remains in question is the path to 100%

electrification.

It is clearmany manufacturers see a path. Beyond their public statements and investments,

this is further evidenced by manufacturer confidentially submitted projections.

Manufacturers annually submit alternative fuel vehicle sales projections to CARB, including

projections for BEVs, PHEVs, and FCEVs, primarily to help staff with future infrastructure

planning. Projections are required for three model years beyond the upcoming model year,

meaning the 2021 projections included 2022, 2023, and 2024 model year projections, and

some manufacturers provided additional projections beyond 2024. These projections are

analyzed and iterated upon during follow-up meetings with manufacturers and kept strictly

confidential. Resulting from this process, CARB has summarized its analysis of the 2021

survey at the aggregate level in the following figure. Moving from 12-percent of actual new

vehicle sales in 2021, the manufacturer-provided data projects steady growth of ZEVs and

PHEVs through the 2025 model year to over 30-percent of sales, shown in aggregate below.

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Mercedes 2021. Mercedes-Benz, “Mercedes-Benz prepares to go all-electric,” Press Release, July 22, 2021.

https://group-media.mercedes-benz.com/marsMediaSite/en/instance/ko/Mercedes-Benz-prepares-to-go-all-

electric.xhtml?oid=50834319 Accessed February 11, 2022.

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NY Times 2022. New York Times. “Mercedes opens a battery plant in Alabama, part of a Southern Wave.”

Jack Ewing. March 16, 2022. https://www.nytimes.com/2022/03/16/business/energy-environment/mercedes-

battery-factory-alabama.html

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Car and Driver 2022. “Tesla Won't Bring Cybertruck, Roadster, Semi to Market in 2022,” January 26, 2022.

Accessed February 8, 2022 at https://www.caranddriver.com/news/a38902936/teslas-elon-musk-future/

Accessed February 11, 2022.

Figure 4: CARB Summary and Analysis of 2021 Annual Alternative Fuel Survey Results

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Compared to CARB’s 2020 survey analysis, also shown, manufacturers have dampened near-

term projections but increased projected volumes in the now imminent 2024 and 2025 model

years. These include only manufacturers who are delivering vehicles for sale in California at

the time of projections, and do not include companies that are in the process of certification

or have announced their first product lines and projected numbers publicly. For example,

Rivian is not included in these projections.

What is striking about these projections is that they were submitted by manufacturers prior

to future regulations being adopted. This means these projections do not consider the effect

of more stringent GHG tailpipe emission regulations nor this ACC II proposal, which would

likely affect manufacturer’s response to the survey. Subsequent to CARB’s public workshops

on its initial proposals in 2021, U.S. EPA has finalized its rulemaking for 2023 through 2026

model year light-duty vehicle greenhouse gas emission standards.

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Its rulemaking analysis

showed a minimum compliance path that would result in 17-percent of new vehicle sales

being ZEVs and PHEVs by the 2026 model year nationally. As shown in section III.A.2, while

California’s new vehicle sales account for approximately 10-percent of total U.S. new vehicle

sales, California’s electric vehicle market comprises nearly 40-percent of U.S. electric vehicle

sales. For some manufacturers, California’s market accounts for more than half of nationwide

electric vehicle sales. If these trends continue, manufacturers will be more than on track to

meet staff’s proposed requirements in the early years of this proposal.

Figure 5 depicts staff’s proposal for the annual percentage requirements for manufacturers

to deliver ZEVs and PHEVs for sale, reaching 100-percent sales by 2035:

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CARB 2022d. California Air Resources Board. 2021 and 2020 Confidential Survey Results, Figure 3. Excel

Spreadsheet.

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86 Fed. Reg. 74,334, Dec. 30, 2021.

Figure 5: Proposed 2026 and Subsequent Model Year Annual ZEV Requirement

As proposed, the requirement increases by 8-percentage points per year for the first 5 years,

and then 6-percentage points per year for the latter 5 years to reach 100-percent in 2035.

Staff proposes this trajectory for two reasons. As stated previously, manufacturers have

announced plans to electrify, and many have indicated to CARB in survey responses that

even in the near-term there will be significant electrification growth. This indicates

manufacturers are not only adding specialty low-volume ZEV models but transitioning high-

volume gasoline models into ZEVs. Staff expects this sort of compliance response as

manufacturers seek to meet the early years of the requirement with the easiest segments to

electrify, such as small and midsized cars, and small crossover utility vehicles. The proposed

trajectory for 2026 through 2030 aligns with what OEMs have stated in projections of ZEVs

and PHEVs. Second, staff is proposing a trajectory that moderates in the final years to 2035.

This is because staff expect the last 20-percent of the fleet will be more challenging to

electrify than the first 80-percent. As stated, surveys reveal up to 80-percent of respondents

show willingness to consider an electric vehicle. Additionally, vehicles built on larger

platforms with greater towing capacity could take longer to electrify, as surveys show current

truck owners are among the most reluctant ZEV buyers. However, there are encouraging

signs of market demand for such vehicles; for instance, Ford Motor Company has suspended

reservations for its full-size F150 Lightening BEV truck given that demand far exceeds their

planned production volumes.

To understand the upper bound for ZEV deployments, staff created scenarios based on

approximately 350 individual vehicle model redesign schedules, which ranged from 4 years

to over 10 years, though most commonly every 5 to 7 years, to predict how the industry

could successfully redesign each model. For the 2020 to 2025 model years, staff assumed

that any announced or known new ZEVs would eventually replace an analogous existing

model. Then beginning with the 2026 model year, individual vehicle models would be

converted to a ZEV at their expected redesign year. In all cases, the market shares of

individual manufacturers are assumed to remain constant at their 2019 model year shares of

new vehicle sales.

Additionally, staff assumed that new ZEV models or variants introduced prior to the 2026

model year would linearly increase their market share for that model over their redesign

period. For example, a new ZEV introduced in 2022 replacing a model on a five-year

redesign schedule would replace 20-percent of that model’s market share in 2022, 40-

percent in 2023, 60-percent in 2024, 80-percent in 2025, and then 100-percent in 2026. For

new ZEVs introduced after the 2025 model year, staff developed three different scenarios: as

soon as possible (ASAP), slow phase, and delayed fuel cell deployment. Below is a summary

of the results for this analysis.

Figure 6: CARB Analysis of Model Turnover Scenarios

In the ASAP scenario, 100-percent of sales of that model would be converted to a ZEV in the

earliest redesign year beginning in 2026, with the announced models pulled forward to 2022

to begin production. In the Slow Phase scenario, gasoline and ZEV variants of the model

continue to be sold after the earliest redesign post-2025 but the percentage by which the

market share of the ZEV variant increases each year depends on the relative share of sales of

that model within the OEM’s portfolio, with the best sellers allowed 10 years to fully convert

to the ZEV variant while smaller volume models assumed only 3 years to fully convert. Finally,

the Delayed Fuel Cell Deployment scenario delays the conversion of top selling models from

fuel cell-oriented manufacturers until their earliest redesign year after 2030 to allow more

time for costs to continue to fall for fuel cell technology. Otherwise, PEV-oriented

manufacturers convert their models the same as in the Slow Phase scenario. Staff’s analysis of

model turnover shows a feasible pathway for manufacturers to introduce new ZEVs at the

pace necessary to meet the stringency targets while remaining on a conventional redesign

schedule and not having to prematurely terminate or redesign an existing model.

For all the reasons listed, which include technology advancements, falling technology costs, a

growing consumer interest, manufacturer electrification commitments and projections, and

feasibility analysis of model turnover coupled with the necessity of electrifying light duty

vehicles to curb the harmful effects of smog-forming and GHG emissions, staff believes its

annual ZEV stringency is appropriate and feasible. Additionally, the proposed ZEV stringency

results in ZEV and PHEV sales that are in line with the trajectory laid out by the 2020 Mobile

Source Strategy. The strategies and scenarios described in the 2020 Mobile Source Strategy

do not reflect a market feasibility analysis, and they were developed as exploratory scenarios

to show what emission reductions would occur under simple vehicle technology and fuel

modeling assumptions. Even with the different in methodology, the similarities between the

proposed stringency and the very aggressive and simplistic Mobile Source Strategy indicates

staff’s strong approach to ZEV stringency in its proposal. As with all light-duty regulations

adopted by the Board, staff understands manufacturers are at different places in terms of

technology and market development. The following subsections will describe the structure

of the ZEV regulation and various flexibilities that are being proposed in recognition of these

differences and still keeping manufacturers on a path to 100% ZEV and PHEV sales by 2035.

2. Proposed ZEV Requirement Structure and Compliance Rules

In the current ZEV regulation, manufacturers must meet an increasing annual requirement for

each model year based on a percentage of their average total California sales. Manufacturers

fulfill the requirements by producing ZEVs and PHEVs for sale in California. Credits per

vehicle vary based on vehicle technology and performance attributes, most notably the

vehicle’s all-electric range.

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Additionally, manufacturers may carry forward surplus credits

without expiration. Given many longer range 250+ mile BEVs introduced earlier than

anticipated, individual vehicles are earning more credits than originally projected. Thus, even

at modest sales rates, most manufacturers have readily exceeded the requirements and are

carrying forward a significant surplus of credits.

Though overcompliance does represent desired market growth and allows for some degree

of compliance flexibility and resilience to unforeseen events, and thus some amount of

overcompliance is positive and provides flexibility within a regulatory program, excess

overcompliance also brings uncertainty to future ZEV volumes and risks unnecessarily

prolonging the elimination of combustion engines and their associated emissions because a

manufacturer could use the over-compliance credits in lieu of producing ZEVs in a future

year, especially for those manufacturers that have not fully committed to zero-emission

platforms. Current rules allow manufacturers to add newly earned ZEV credits into a bank

account and then spend unrestricted from that account to meet the requirement. This has

made sense in past versions of the ZEV regulation when volumes were low, credits had no

expiration, and more flexibility was required of manufacturers developing and introducing

their first ZEV products. Below is a graph showing credits amassed by manufacturers through

the 2020 model year.

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See section III.C.3. for more on technical minimum requirements for ZEVs, and section III.C.4 for technical

minimum requirements for PHEVs.

Figure 7: ZEV Regulation Annual Requirements, Annual Credits Earned, and Credit

Balances for Model Years 2014 through 2020

Overcompliance with the current ZEV requirement has generated a bank of credits that the

proposed regulation accounts for in its overall structure. As discussed, one aspect of dealing

with overcompliance is ensuring the requirement is set at an appropriate level into the

future.

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To achieve the 100-percent goal set by Governor Newsom’s executive order N-79-

20, the staff has therefore taken a new approach in this proposal compared to prior

regulatory changes.

a) Simplified Vehicle Accounting System

As described above, staff’s proposal requires manufacturers to continue to meet an

increasing percentage of new vehicle sales as ZEVs and PHEVs. In current regulations,

vehicles earn “credits” based on vehicle range and power. However, instead of earning a

variable “credits” for each vehicle produced as in the current regulations, staff is proposing

minimum technical requirements, described in Section III.C.3, for ZEVs and PHEVs to be

eligible to count toward the annual percentage requirement. In 2026 and subsequent model

years, the currency of the ZEV regulation will change from “credits” to “values” as to not

cause confusion between the two programs. Functionally, this would mean that each vehicle

compliant with these requirements would earn the same value and count as one vehicle

value, allowing the market to create a strong incentive for manufacturers to improve overall

vehicle quality. This simplified system helps ensure conventional vehicles and their

associated emissions are displaced, while also making the regulation more straight-forward

and increasing certainty on future vehicle volumes.

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See section III.C.1. for a summary of ZEV stringency proposal.

b) Determining Manufacturer’s Compliance and 5-Year Excess Vehicle

Value Life

Overall, staff is proposing to continue with a fleet performance standard that allows for

banking, trading, and deficits. Allowing for appropriate banking, trading, and fulfillment of

deficits appropriately affords manufacturers the flexibility needed to fully transition to

electrification and handle year-to-year sales fluctuations and vehicle redesign schedules. In

addition to an effective one-to-one vehicle to requirement structure, staff proposes to

change the sequence of how annual compliance is performed to align with how it is currently

done for both criteria pollutant and GHG fleet average standards. Namely, the

manufacturer’s current model year performance (i.e., number of ZEVs and PHEVs produced)

is first compared to the annual performance requirement before allowing any usage of

credits from trading or banking. In this manner, manufacturers are far more limited in their

ability to create stockpiles of credits to stave off future requirements or dip into previously

earned reserves while simultaneously banking newly earned surpluses. This will return

banking and trading to the intended purpose of managing year to year fluctuations rather

than enabling strategies to minimize future compliance or prolong the use of non-ZEVs.

In the case of actual overcompliance with the annual requirement based on ZEVs and PHEVs

produced for that model year, the manufacturer will be allowed to bank or trade those

surplus values for use any time within the next four model years or to pay off a previous

deficit. And in the case of a shortfall with the annual requirement, the manufacturer would

be allowed to dip into its bank or make use of other allowances to meet the shortfall or, in

the absence of any valid banked values, carry forward a deficit to be made up within the next

three model years. But a manufacturer would no longer be able to shuffle credits around

such that it was simultaneously banking credits for future use and spending credits earned in

past years or otherwise use allowances in any year that it didn’t actually have a shortfall.

c) Converted ZEV and PHEV Values

As discussed previously, manufacturers are expected to over-comply with current ZEV

requirements through the 2025 model year. Though this may not be the case for every

manufacturer, the industry as a whole, in 2021, was already above what the Midterm Review

projected would be necessary for the 2025 model year. Even in the unlikely event that the

industry were to flat line at current levels, most manufacturers would be in a position of

carrying over significant credits into a future program. And if sales increases continue as

projected by the manufacturer survey responses, there will literally be millions of excess ZEV

credits and over 100,000 PHEV credits under the existing standards after the 2025 model

year.

With regard to the credits earned and expected under the existing standards, staff propose

to limit their use in ways that reward past efforts while emphasizing continuing ZEV and PHEV

sales. Staff has three proposals related to this flexibility for pre-2026 credits. First, staff

proposes to convert pre-2026 banked credits to align with the effective one per vehicle value

under the proposed new regulatory structure. Pre-2026 ZEV credit banks would be divided

by 4, which represents the maximum number of credits earned by a ZEV under the existing

regulation and would be most like a ZEV meeting the proposed minimum range requirement.

Pre-2026 PHEV credit banks would be divided by 1.1, which represents the maximum

number of credits earned by a PHEV under the existing regulation and most like a PHEV

meeting the proposed minimum range requirement.

After the credit banks are converted, staff proposes to further limit the use of these credits,

first by capping use of these credits to no more than 15-percent of the annual requirement,

and second, by expiring these converted credits after the 2030 model year. Allowing for

some use of converted ZEV and PHEV values in the 2026 through 2030 model years would

continue to help manufacturers manage year-to-year fluctuations in annual vehicle volumes

and still allow for full compliance. Limiting the usage and the life of banking within the

program would help ensure manufacturers make progress toward future requirements rather

than accumulate large compliance banks to stave off increasing deployment of ZEVs.

d) California and Section 177 State Pooling

Section 177 of the federal Clean Air Act allows other States to adopt California’s regulations.

At present, 14 states have adopted California’s ZEV regulation (as part of adopting the

Advanced Clean Cars program): Colorado, Connecticut, Maine, Maryland, Massachusetts,

Minnesota, Nevada, New Jersey, New York, Oregon, Rhode Island, Vermont, Virginia, and

Washington. Two others adopted California’s LEV regulation, Delaware and Pennsylvania,

and are exploring adopting the ZEV regulation, along with New Mexico and the District of

Columbia.

250

As other states adopt California’s proposed standards, market demand for ZEVs

will increase and costs will tend to decline faster than they otherwise would.

251

The concept of pooling is to allow manufacturers to move excess ZEV and PHEV values

earned in one state for use in another state where there is a shortfall relative to the

requirement. The current ZEV regulation allowed pooling to occur only for those

manufacturers that participated in the optional compliance path in the first four years of the

regulation (2018 through 2021 model years). However, once in, the current regulation does

not limit manufacturers in the amount that they are allowed to pool. Additionally, current

pooling only allows this flexibility among individual Section 177 States and does not include

California.

Section 177 States are still working toward building electric vehicle markets in their states,

though market share is increasing across the board. Depending on when the Section 177

State adopted the ZEV regulation, states are in varying places of ZEV market development. In

these years of expansion, ZEVs sold anywhere in a state that has adopted these proposed

regulations benefit overall market development, reduce ZEV costs, and increase

infrastructure build-out – to the benefit of Californians and residents of any state that

chooses to adopt these standards. Over time, however, more focused benefits in particular

states become more important. To this end, staff propose to provide flexibility to

manufacturers in the 2026 through 2030 model years, by allowing all manufacturers to

transfer or “pool” excess ZEVs and PHEVs earned in California or individual Section 177

States to meet a shortfall in any given model year (or a deficit carried forward from a

previous model year) elsewhere (e.g., in California or other Section 177 States).

Manufacturers could use such pooling to meet up to 25-percent of their annual requirement

in 2026 model year, declining thereafter, as shown in the Table III-2. For example, ZEVs

250

CARB 2022e. California Air Resources Board, “States that have Adopted California's Vehicle Standards under

Section 177 of the Federal Clean Air Act,” updated March 17, 2022.

251

The decision whether to adopt California’s regulation is solely that of the other states. This analysis,

accordingly, only considers the potential costs of the proposed regulation on California individuals and

businesses, as required by the Administrative Procedure Act and its implementing requirements.

earned in excess of a manufacturer’s requirement in one state could be transferred to meet

the manufacturer’s requirement, up to the allowed cap, in another state.

Table III-2 Proposed Maximum Percent of Annual Requirement Allowed Using Pooled

ZEVs and PHEVs

Model Year 2026 2027 2028 2029 2030

Pooling Cap 25% 20% 15% 10% 5%

As with converted ZEV and PHEV values, allowing manufacturers to use pooled ZEV and

PHEV values would help them manage year to year fluctuations in annual vehicle volumes

especially across different states and still allow for full compliance. “Pooling”, unlike

converted ZEV and PHEV values, has the additional benefit of maintaining the overall

stringency of the ZEV regulation while allowing for minor state-to-state variability in vehicles

sales. Limiting the model years and the total amount a manufacturer can use this flexibility

with a “cap” helps ensure manufacturers make progress in each state toward the 100-

percent ZEV requirement in the 2035 model year. Additionally, the phase down of the

percentages ensures manufacturers do not end up with too large of a gap in any state

between actual sales volumes of ZEVs and PHEVs and the 2031 model year ZEV

requirements.

3. Minimum Technical Requirements for ZEVs

A ZEV is defined as a vehicle that produces zero exhaust emissions of any criteria pollutant

(or precursor pollutant) or greenhouse gas under any possible operational mode or

condition. Currently, BEVs and FCEVs meet the definition of a ZEV, and can qualify to meet a

manufacturer’s ZEV requirement, so long as the vehicle is tested according to CARB’s test

procedures and demonstrates more than 50 miles range on the Urban Dynamometer Drive

Schedule (UDDS),

252

and conforms to the SAE J1772 Charging Standard

253

for Level 1 and 2

charging. As discussed in further detail in Section III.D., ZEVs have had no other

requirements typical of conventional internal combustion engine vehicles such as minimum

durability or required warranty coverage.

Even as staff’s proposal is under consideration, technology is rapidly developing, battery

costs are coming down, and charging behavior is being studied —and is changing —as the

BEV market grows. The purpose of increasing and strengthening electric range minimum

requirements is to ensure that ZEVs are attractive to consumers and actually replace internal

combustion engine vehicles, securing the resulting air quality benefits by ensuring the

efficacy of the lowest-cost vehicle option in meeting basic transportation needs, as it is

reasonable to assume that this sort of vehicle would be an entry point for lower income

individuals and be a vehicle that would effectively replace a gasoline vehicle. Roughly one-

third of Americans consider electric vehicles as lacking or inadequate compared to their

252

Urban dynamometer drive schedule is another name for the Federal Test Procedure or FTP, and reflects a

city-like drive cycle that requires minimal power demands to meet the trace.

253

Currently, manufacturers are required to meet “SAE Surface Vehicle Recommended Practice SAE J1772 REV

JAN 2010, SAE Electric Vehicle and Plug-in Hybrid Electric Vehicle Conductive Charge Coupler”.

gasoline counterparts,

254

and while California electric vehicle sales are highest in the

nation

255

, about half the U.S. population still has little interest in an electric car.

256, 257, 258

Improvements to charging and range are necessary to overcome this reluctance since these

are top concerns contributing to hesitation in choosing an electric vehicle.

259

Staff is proposing to update the minimum technical requirements of a ZEV to require at least

a 200-mile combined city and highway test range. Additionally, staff is proposing that BEVs

must have direct current (DC) fast charge capability, with vehicle connectors that conform

with the SAE J1772 Combined Charging Standard (CCS). To guarantee appropriate charging

speeds, BEVs would be required to have at least a 5.76 kW on-board charger and be

equipped with a 20-foot Underwriter Laboratory (UL) 2594-certified charging cord capable of

both Level 1 and Level 2 electrical charging. Additionally, manufacturers would be required

to comply with the durability, warranty, service information, vehicle data standardization, and

battery label requirements described in section III.D. Table III-3 summarizes staff’s proposed

minimum requirements in comparison to what is currently required.

Table III-3 Summary of Proposed Minimum Technical Requirements for ZEVs

Category

Current (through 2025)

Proposal (2026+)

Range

50 miles UDDS

200 miles 2 cycle

Level 2 J1772 (or adapter)

Required

Required (no change)

On Board Charger Size

> 3.3 kW > 5.76 kW

Convenience Cord

Not Required

Required (Level 1 and 2

capable)

DCFC Capability

Not Required

Required

DCFC Inlet

Not Required

CCS (or adapter)

ZEV Assurance Measures Not Required Required

These proposals, including background, problem solved, and feasibility, are explained below.

a) Defining ZEV Test Groups

When vehicles are certified, manufacturers submit data on batches of vehicles grouped by

defining emission characteristics.

260

These batches of similar vehicles are called test groups.

Multiple models can be certified within one test group, as long as the vehicles have the same

engines and emission control technologies. Due to the lack of tailpipe emissions, ZEVs have

had minimal definition and guidance around test groups. Staff is proposing manufacturers

define test groups for ZEVs based on the following information: powertrain deterioration,

battery configuration, motor configuration, and vehicle class. These are in line with how

254

Pew 2021

255

Veloz 2022

256

Green Car 2021b.

257

J.D. Power 2021b.

258

Pew 2021.

259

Consumer Reports 2021

260

40 CFR § 86.1843-01

manufacturers are grouping ZEVs for certification today and are also inclusive of factors that

would need to be monitored in determine compliance with the proposed range durability

requirement over the vehicle’s useful life (see section IV.D.2).

b) Minimum 200 Mile Electric Range

Currently, ZEVs are required to have 50 miles or greater electric range on the UDDS cycle. In

the real world, this would equate to approximately 30 miles of range. But manufacturers

must also respond to market demands. Electric driving range is the only attribute where

more electric vehicle owners report to be dissatisfied than satisfied.

261

Perceptions remain

that ZEVs limit the distance one can travel, and insufficient driving range and the need to

charge too often are causing reluctance to buy.

262, 263, 264

Current owners report a preferred

BEV range of roughly 309 miles and PHEV range of 176 miles.

265

The broader U.S. public

supports similar ranges, with about half saying they would consider purchasing an electric

vehicle if it could drive at least 300 miles on a single charge.

266

Manufacturers have responded to market demand by offering vehicles with more than the

minimum range required by the regulation. Of the 18 unique ZEV models which earned

credit for the 2020 model year, all were certified with a greater than 120-mile electric

range.

267

This increase in electric range is made possible by decreased battery costs, battery

pack capacity increases, and efficiency improvements made to drivetrains and associated

components. As explained in more detail in section III.A.3. and Appendix G, staff expects this

growth in range to continue. Many manufacturers have announced 300-mile (or more) real-

world range BEVs.

Staff is proposing to increase the minimum electric range requirements for ZEVs from 50

miles UDDS range to 200 miles 2-cycle test range (which translates into a 150-mile real world

range). Staff is proposing to shift from UDDS-only range to a 2-cycle test range to provide a

better correlation with real world range.

The increased minimum range was chosen based on consumer survey responses, meetings

with community groups, data from Clean Cars 4

268

All, and analyzing daily driving patterns to

ensure emissions would be effectively displaced. First, minimum range requirements are

important to protect the lowest cost compliance option and guarantee replacement of a

gasoline vehicle within a household fleet. Lower-income individuals entering the new vehicle

261

Hardman 2021

262

Morning 2021a. Lisa Martine Jenkins, “The Electric Car Consumers Want: Lower Cost, Higher Mileage”,

Morning Consult, Published February 9, 2021, https://morningconsult.com/2021/02/09/energy-efficiency-series-

electric-vehicles-consumers-polling/

263

Green Car 2021a. Green Car Congress, “Strategy Analytics: Overall UX of BEVs Does Not Match Price

Point”, Published April 15, 2021, https://www.greencarcongress.com/2021/04/20210414-saux.html

264

Consumer Reports 2021.

265

Hardman 2021

266

Consumer Reports 2020.

267

CARB 2021d. California Air Resources Board. “2020 Zero-Emission Vehicle Credits”

https://ww2.arb.ca.gov/sites/default/files/2021-12/2020_zev_credit_annual_disclosure_ac.pdf” Released

December 2020. Accessed January 28, 2022.

268

CARB 2021e. California Air Resources Board. EFMP Retire and Replace Program Statistics. September 9,

2021 https://ww2.arb.ca.gov/sites/default/files/2021-

09/EFMP%20Website%20Statistics%20Tables%20Cumulative%202021_Q2%2009-21-21.pdf

market at lower price points should have options to purchase a useful ZEV rather than being

limited to a vehicle that does not meet their needs or buying a conventional vehicle and

continuing to pollute. Even at the minimum required, a range value of 150 miles meets the

average daily demand for virtually all drivers. In combination with the proposed durability

requirement, a vehicle at 10 years would still have over 100 miles of electric range. Therefore,

150 miles range as an absolute minimum is appropriate.

Note that staff assumes manufacturers will continue to produce vehicles at many different

range levels, price points, and in various segments. On average, as evidenced by staff’s cost

assessment, manufacturers are expected to be building 300-mile electric range vehicles to

elicit the necessary response to build a market in the earlier years and closer to an average of

350-mile electric range vehicles by the end of the program.

c) Level I, Level 2, and On-Board Charger Minimum Requirements

Plug-in electric vehicle charging can occur at various charging levels, speeds, and with

different charging connectors. Charging speed is a measure of the kilowatt throughput of the

electricity and is dependent on the capability designed into the car, the cord/equipment

used to connect the car to power, and the type of power circuit the cord/equipment is

connected to. Level 1 alternating current (AC) charging uses a standard household 120 Volt

outlet to charge the vehicle through its on-board charger (OBC). Level 2 AC charging uses

charging equipment compatible with a 240 Volt outlet to charge the vehicle at higher

charging speeds through its OBC. Currently, BEVs and PHEVs must comply with charging

requirements, which include Level 1 and 2 plug standardization to the SAE J1772

specification and a minimum OBC capability. Vehicles with a unique charging inlet, such as

Tesla, can alternatively meet this requirement by supplying an adapter with each vehicle to

connect from their unique charging plug to the SAE J1772 plug.

Current BEVs and PHEVs are required to be equipped with an OBC with a charging capability

of 3.3 kW or higher. This was intended to ensure the vehicle could be charged within a

reasonable time period with a Level 1 or 2 connection given the typical battery size (and

electric range) of BEVs and PHEVs planned at the time. However, as battery technology has

improved, BEVs and PHEVs are being produced and designed with increasingly larger

batteries to meet the market demands for longer range and the higher minimum electric

ranges required by regulation. Currently, BEVs and PHEVs in the market today comply with

CARB’s existing minimum OBC capability requirements. The majority would also comply with

staff’s recommended changes, particularly those with larger battery packs that would meet

or exceed the proposed technical minimum certified all-electric range requirements.

As battery capacity increases, the minimum capability of the OBC must also be

correspondingly increased to maintain a reasonable charging time and reduce the risk of

consumer dissatisfaction. Electric vehicle owners report that slow charging is dramatically less

satisfying, and when drivers experience slower-than-normal charging speeds it has a very

large overall negative effect.

269,270

Requiring a minimum on-board charging speed will reduce

269

J.D. Power 2021c. J.D. Power, “Level Up: Electric Vehicle Owners with Permanently Installed Level 2

Chargers Reap Benefits form Their Investment, J.D. Power Finds” (Press Release). Published February 3, 2021.

https://www.jdpower.com/business/press-releases/2021-us-electric-vehicle-experience-evx-home-charging-

study.

270

Hardman 2021.

occurrences and frustrations of “slow charging” and help shift perceptions closer to the

convenience car buyers consider reasonable.

Accordingly, staff proposes that all 2026 and subsequent model year BEVs and PHEVs be

equipped with an on-board charger with at least an output of 5.76 kilowatts, or capable of

providing sufficient power to enable a full charge in less than 4 hours, whichever is lower.

Upsizing the OBC also benefits consumers by better ensuring they can take advantage of

existing electrical architecture at their residence. The lowest amperage 240 Volt circuit

commonly found in residences is a 30 Amp circuit (such as one used for a clothes dryer). By

sizing the OBC to at least be able to use 24 Amps (80-percent of the circuit rating as allowed

by California Electrical Code) at 240 Volts, the included cord will likely be compatible with

any existing 240 Volt circuits in a residence and give the largest number of consumers a

reasonably fast maximum charging speed without having to upgrade the cord or the

residence wiring. Additionally, in the case of PHEVs, excessive charge times could lead to

reduced usage of the electric capacity and increased usage of the gasoline engine

undermining the needed air quality and greenhouse gas reductions. Staff expects

manufacturers to be able to comply with larger OBCs as they design vehicles that can also

meet the proposed technical minimum requirements.

d) Charging Cords

Increasing the ease of home charging is crucial in electric vehicle uptake and retention.

Charging is a persistent frustration and barrier to electric vehicle adoption in consumer

studies

271, 272, 273

and non-residential electric vehicle charging options are generally less

convenient and more expensive.

274

Additionally, charging dissatisfaction is linked to electric

vehicle owners reverting to traditional gasoline vehicles – especially for drivers without Level

2 charging at home.

275

As the market expands to lower price point vehicles to appeal to

more diverse vehicle owners including used vehicle purchasers, it is important to reduce any

barriers, including those rooted in consumer perceptions, that would discourage selection of

a BEV or PHEV. If BEVs and PHEVs become the predominant technologies, it is essential

those vehicles, in addition to meeting the technical minimum range requirements described

above, are able to be charged reasonably quickly which necessarily means at Level 2 speeds

in both residential and non-residential settings. Having an appropriate charging cord

expands access to charging, easing concerns, and will support market update, thereby

ensuring emission reductions from the program.

Current Vehicle Charging Cords. Every BEV and PHEV available on the market today comes

with a charging cord: a cord that safely connects an electric vehicle to a standard wall

electrical outlet. Though current regulations do not require these cords to be supplied with

vehicles, all vehicle manufacturers have provided these cords to the first purchaser of the

vehicle to ensure some level of charging capability such as Level 1 charging at a driver’s

residence. These included cords have different capabilities across today’s vehicles but

271

Consumer Reports 2021.

272

Consumer Reports 2020.

273

Green Car 2021b. Green Car Congress, “Continental Mobility Study 2020 Finds People Still Have Doubts

About EVs”, Published January 8, 2021, https://www.greencarcongress.com/2021/01/20210108-conti.html

274

NREL 2021b

275

Hardman 2021

typically provide Level 1 charging capability while the majority of commercially available

charging cords and equipment support Level 2 charging to provide owners with faster

charging capability. More recently, industry leaders have included dual capability charging

cords with their vehicles capable of charging at both Level 1 and Level 2. With such a cord, to

take advantage of the faster Level 2 charging speeds, all that is required is for drivers to

provide for access to the appropriately sized electrical outlet and circuit at their residence.

Current Vehicle Charging Cord Length. In addition, many included cords are too short in

length to be useful to a broad range of consumers with varying access for parking in

proximity to an appropriate outlet. A 2012 analysis estimated that approximately half of new

car buying households in the United States park vehicles within 25 feet of a 120V outlet.

276

While this older research focused on new car buyers, it does illustrate that as the

convenience cord lengthens, access to at-home charging expands. Consumers also favor

longer charging cords. Tesla was ranked highest overall on the best home charging

experience in a recent consumer study with satisfaction scores especially high for their Level

2 permanent charger reliability and cord length,

277

which is 24 feet.

278

Tesla’s mobile

connector is 20 feet long and includes two outlet adapters: one for a standard 120 Volt

household outlet and a second adapter for a 240 Volt outlet.

279

Rivian trucks and the Ford

Mach-e will also come equipped (standard) with a dual capable cord.

280,281

Together, the limitations of slower Level 1 charging, need for a dedicated circuit, and shorter

cord length only meet the driving (and thus, charging) needs of a small subset of vehicle

owners. As a result, many BEV and PHEV drivers have needed to purchase separate Level 2

charging equipment with longer cords either offered by the OEM or by a third-party and

many have needed to make electrical modifications to their home or garage to match the

needs of the charging equipment. As the market expands to vehicles with larger batteries

and a wider range of consumers with higher driving needs and less optimal parking

situations, the need for Level 2 capable charging is expanding. Surveys of electric vehicle

owners show that most respondents were satisfied with at-home Level 2 charging.

282,283

Therefore, a requirement to simplify and expand that access is expected to have a substantial

positive effect. While highest satisfaction is associated with using at-home installed Level 2

charging (749 points on a scale of 1,000), using a portable Level 2 charging cord closely

follows with satisfaction levels at 741 points according to a JD Power study.

284

The lack of

Level 2 charging cords as a standard accessory for new BEVs could become a larger barrier

276

NREL 2021b

277

J.D. Power 2021c

278

Tesla 2022a. Tesla, “Wall Connector”, Accessed 1/17/2022, https://shop.tesla.com/product/wall-connector

279

Tesla, 2022b. Tesla, “Mobile Connector”, Accessed 1/17/2022, https://www.tesla.com/support/home-

charging-installation/mobile-connector

280

Rivian 2021. Portable Charger Guide

https://assets.rivian.com/k534zewngntr/6tSeP1ckHvnfK1Er0P3I3w/0a5ea4d419dcb86019db1e6a3a576b3f/port

able-charger-guide.pdf 2021. Accessed February 14, 2022.

281

Ford 2022. Ford Mach-e Specifications. “Charge Capability” and “Ford Mobile Power Cord”

https://www.ford.com/suvs/mach-e/?intcmp=charging-bb-vhp-mach-e Accessed February 14, 2022.

282

Hardman 2021

283

J.D. Power 2021c

284

J.D. Power 2021c.

to adoption of these vehicles for consumers who are not willing to purchase additional

charging equipment.

Dual Voltage Capability. Beyond the length and dual capability, an additional issue with

charging cords has emerged. Even with the presence of a compatible 120 Volt or 240 Volt

outlet available for charging, there is great variance among households as to the capability of

the power circuit and other electrical consumers on the same circuit. For example, an

available 120 Volt circuit in a garage might already have other electrical devices such as a

spare freezer or garage door opener or a second plug-in vehicle that, when combined with a

Level 1 charging cord designed to work at the maximum allowable amperage of a dedicated

circuit, could overload the circuit, tripping a breaker and terminating charging. Or a 240 Volt

30 Amp circuit might be readily available in some households, yet a supplied Level 2 charge

cord may require a dedicated 50 Amp or larger circuit. In these cases, substantial electrical

modifications to the residence are likely necessary even to make use of the supplied charging

cord.

Recognizing this need, some manufacturers have already implemented additional features

either in vehicle or on the cord itself to allow users to down select and draw power at a lower

rate that is compatible with the less capable circuit they are using. For instance, BMW

enables users of some PHEVs to reduce the maximum amperage draw during charging

through the in-vehicle displays . Additionally, some Hyundai models come with a Level 1

charging cord that has a button on the cord to allow the user to reduce the amperage draw

from 12 to 10 or 8 amps. Further, many commercially available Level 2 chargers provide such

capability to users that can be selected on the device itself or managed through a connected

software program or application. With innovations such as these, a vehicle owner can more

readily adapt charging to make use of the supplied cord with existing residence circuits and

no additional costs to either modify the home wiring or buy a different charger.

UL Safety Standards. Consistent with UL standards for safety, the user is only allowed to

select a lower amperage rate than the cord and plug/outlet configuration is capable of safely

handling. As vehicles are already designed to accept varying charge levels at or below the

maximum rated charge rate and because precisely controlling the charge rate during

charging is a necessary function, vehicles are already designed to accept and control

charging at lower amperages. The only feature necessary to meet this capability is providing

a method for the consumer to select the amperage either through the charging cord or the

vehicle. The addition of such a feature to existing charge management settings is expected

to require minimal expense for manufacturers relative to what already exists where a

consumer is typically allowed to set preferred days and times for charging to take advantage

of favorable electricity rates or ensure a full charge prior to the next planned departure.

Charging Cord Proposal. With these considerations in mind, staff proposes that all 2026 and

subsequent model year ZEVs and PHEVs be equipped with convenience cords at the time of

vehicle purchase. These cords shall be at least 20 feet in length, which aligns with most

commercially available Level 2 chargers and the California Electric Code, section 625.17(C),

Part 3, Title 24 of the California Code of Regulations. Cords also must be tested and listed by

a nationally recognized testing lab as meeting the UL Standards for Electric Vehicle Supply

Equipment (UL2594). These cords must have Level 1 and Level 2 capability, meaning they are

able to be used with two or more different plugs that could fit into a standard 110V or 220V

outlet. Additionally, staff proposes that a lower charge rate (amperage) can be selectable by

the user, either on the cord itself, or through the vehicle user interface. This will help account

for unique electrical situations with which a fixed amperage cord would not be compatible,

as noted above.

By requiring all vehicles to have an included charging cord that is Level 1 and Level 2

capable, at various amperages, and with a minimum 20-foot length, the cord can meet the

charging needs of a much larger portion of vehicle owners. This helps ensure more new and

used vehicle buyers will be better situated to choose a ZEV over a conventional vehicle,

serving the goal of reducing vehicle emissions. Further, as a basic cord is already included

with every BEV and PHEV, the incremental cost to upsize that cord to be more capable in

accordance with the proposed requirements is less than the cost a consumer would face to

purchase separate Level 2 equipment to meet their needs. And by allowing the consumer to

select a lower amperage for charging, the need to modify the home’s electrical circuit to be

compatible with the cord is greatly reduced.

e) DC Fast Charging Capability and Inlets

Beyond the Level 1 and Level 2 charging described, direct current fast chargers (DCFC)

bypass the vehicle’s OBC to charge the battery directly and more quickly. This allows some

vehicles to be charged in just 30 minutes, as opposed to 6 or more hours typically required

to charge at Level 1 or Level 2. DCFC capability is not currently required and not available on

all vehicles. While many BEVs are equipped with DCFC inlets, some manufacturers have

offered some versions of their models without a DCFC inlet or capability.

While the SAE J1772 standard is both required and commonplace for Level 1 and Level 2

charging,

285

a singular standard has not been accepted by industry, nor mandated by

regulation, for DCFC. Three separate DCFC inlets exist on BEVs deployed in the United

States today – CHAdeMO, SAE Combined Charging System (CCS1) Type 1 (SAE J1772), and

Tesla’s proprietary connector. While the possibility of one conforming DCFC system has

existed for many years, differences in vehicle technologies and business interests have led to

continued deployment of the three distinct DCFC connections.

Originally developed by Japanese automakers, CHAdeMO is the longest established, but

least deployed, DCFC inlet on current models. Despite its early development, CHAdeMO did

not receive support as an SAE standard. In 2011, a consortium of other automakers (BMW,

Daimler, Ford, GM, and the VW Group) moved forward in support of the SAE CCS1, which

takes the existing Level 1 and Level 2 SAE J1772 plug and adds additional pins for high

power DC, eliminating the need for separate low AC and high DC power connections on the

vehicle (as needed for CHAdeMO).

286

At around the same time, in 2012, Tesla patented and

launched its Supercharger network,

287

adding a third fast-charging system with a different

285

CCR, Title 13, section 1962.3

286

Herron, 2016. “EV Fast Charging Standards – CHAdeMO, CCS, SAE Combo, Tesla Supercharger.” Accessed

March 26, 2021. https://greentransportation.info/ev-charging/range-confidence/chap8-tech/ev-dc-fast-

charging-standards-chademo-ccs-sae-combo-tesla-supercharger-etc.html

287

Tesla 2012. “Tesla Motors Launches Revolutionary Supercharger Enabling Convenient Long Distance

Driving.” Accessed March 26, 2021. https://ir.tesla.com/press-release/tesla-motors-launches-revolutionary-

supercharger-enabling

physical connector.

288

Like CCS1, Tesla uses a single receptacle for both AC charging and DC

fast charging and initially benefited from having the fastest charge rate.

In addition to the physical differences in connector design, communication methods and

protocols also differ among the DCFC systems. To enable DCFC, a connector is plugged into

the vehicle whereupon a “handshaking” process is performed. This information exchange

between the DCFC equipment and the vehicle is necessary to manage the charging event

within the capability of the vehicle and the equipment. While similar, the three DCFC systems

do not use identical communication methods for this process – SAE CCS1 uses power line

carrier (PLC) communication signals over the J1772 AC pins of the connector, whereas

CHAdeMO and Tesla use controller area network (CAN) communications over additional

dedicated pins in the connector.

289

Though initially targeted primarily for travel corridors to facilitate longer distance traveling

and not forecasted to be the main medium for routine charging, DCFC will likely become

more prevalent in the future for a few reasons:

1) BEV electric range is growing, as evidenced by the description of technologies found in

Chapter III.A.3. of this report.

2) As vehicle electric range grows, consumer expectations of the time it takes to charge a

vehicle are unlikely to change. According to recent surveys, drivers expect to have a similar

refueling experience as gasoline vehicles. This would suggest more drivers may utilize DCFC

as a means to recharge longer range BEVs in times closer to that to refuel a conventional

gasoline vehicle.

3) Demographics of ZEV buyers are expanding. The majority of current ZEV buyers are

affluent, single-family homeowners, who tend to have accessible charging at home. A recent

survey showed roughly one-third of California drivers signal “nowhere to charge at home” is

a reason for hesitation in electric vehicle ownership.

290

As electric vehicles expand to different

segments of the population (e.g., wider variety of housing types and geographic locations), it

is predicted that the percentage of owners with access to residential charging will

decrease.

291,292

As sales increase to meet staff’s proposal for 100-percent electrification by

2035, drivers living in rentals and multi-unit dwellings without control over the property to

install charging systems will become more common. Multi-family dwelling residents and

renters have less residential charging access than drivers living in single-family and owned

homes.

293

These drivers may have limited access to Level 1 or Level 2 charging infrastructure,

which can require 8 or more hours to charge a vehicle, and will become more reliant on

public DCFC to meet routine charging needs. Further, public fast charging is the most

288

Green Car 2011. “Tesla’s 2012 Model S Charging Equipment.” Accessed March 26, 2021.

https://www.greencarreports.com/news/1066861_teslas-2012-model-s-charging-equipment-redesign-for-

redesigns-sake

289

Yoshida, 2020. “CHAdeMO Charging Standard Future Direction.” Accessed Feb 17, 2020.

290

Consumer Reports 2021

291

NREL 2021b

292

CEC 2022b

293

NREL 2021b

common expected charging method among people living in larger apartment buildings

(those with more than 12 housing units).

294

Without being equipped for DCFC, BEVs will not be able to charge in the shorter times that

are more comparable to conventional vehicles, and thus may not be suitable for use by

drivers in a way that displaces conventional engines and their associated emissions.

The existence of three different DCFC systems leads to inconsistent and complex charging

experiences for consumers. Currently in California, the majority of DCFC connectors are CCS

and Tesla, though CHAdeMO has significant availability. This variation complicates expansion

of the market for publicly available charging infrastructure at a time when rapid growth is

needed for the vehicles that will be produced to meet the proposed ZEV standards.

Consumers already can have a hard time with their public charging experience, as evidenced

by surveys showing the number one reason for ZEV discontinuance (a term for choosing to

buy a non-ZEV after owning a ZEV) is frustration with infrastructure and charging. Measures

to simplify charging methods and equipment and increase consistency and availability are

essential, especially as the ZEV buying population will continue to evolve to include more

drivers dependent on public DCFC.

The CEC projects that in order to meet the Governor’s N-79-20 goals for 2030, 715,000

public and private chargers will need to be deployed, with 24,000 of those being DCFCs.

295

If vehicles do not have a standardized DCFC inlet, the deployment of this additional

infrastructure will be more complex to protect for the various connectors that vehicles may

be equipped with, and consumers will need to take additional steps when planning trips to

ensure their vehicle is compatible with the DCFC station they intend to use. If vehicles do

not have DCFC capability at all, their ability to be used to replace a gasoline vehicle will be

greatly limited to vehicle owners who have very specific and potentially limited travel needs

and access to charging. Standardizing to one DCFC inlet will support private and public

investment in public DCFC charging equipment and greatly simplify the future charging

experience for consumers by ensuring compatibility with their vehicle.

Staff is proposing the SAE J1772 standard for 2026 and subsequent model year BEVs and

PHEVs (if they are DCFC charge capable). The majority of manufacturers are already

coalescing around the SAE J1772 standard in current vehicle production. For example, in

2020, 13 available BEV models were outfitted with a CCS1 inlet while four BEV models had

the Tesla inlet and only two BEV models were outfitted with CHAdeMO. In 2022, 51 vehicle

models are expected to have the SAE inlet, six are expected to have the Tesla inlet and two

are expected to have the CHAdeMO inlet. Internationally, European Union regulations have

standardized DCFC on vehicles and EVSE to the SAE J1772 standard for Europe, commonly

referred to as Combined Charging Standard (2) (CCS2), a very similar DCFC charging

standard to the standard being proposed here, commonly referred to as CCS1. Choosing the

SAE J1772 standard for new vehicles would impact the fewest regulated manufacturers,

further standardize charging across the market domestically and internationally, minimize

costs, and increase access to charging equipment – all of which leads to greater consumer

acceptance and therefore deployment of ZEVs in place of conventional vehicles.

294

Consumer Reports 2020

295

CEC 2021b

Additionally, manufacturers with vehicles that do not meet the proposed regulation would

have multiple paths to comply and sufficient lead time to comply. Manufacturers could

readily design and equip future vehicles with a SAE J1772 compatible inlet since vehicles

already have the wire, cooling, necessary processing chips, and inlets for DC charging. This

primarily leaves the difference in the communication protocol, and shape and configuration

of the connector. Given the lead time in adopting this new proposal, manufacturers have

been provided sufficient time to implement such a change during a normally scheduled

redesign or refresh interval for the vehicle at little or no additional cost using currently

available technology. As an example, Tesla already went through a similar process to switch

Model 3 vehicles produced in the U.S. but sold in Europe to be equipped with an SAE J1772-

compatible inlet as required by European regulation.

296

Further, due to the fewer number of

wires and pins required for SAE J1772 versus CHAdeMO, the ability to integrate an SAE

J1772 inlet into the same charge door/port on the vehicle as the Level 1 and Level 2

connector, and the higher volume of SAE J1772 connectors expected to be used (leading to

increased competition among more suppliers), manufacturers may realize a cost savings by

switching to the proposed CCS standard. Alternatively, manufacturers could choose to add

the required connector in addition to their alternative connector or provide an adapter to

connect between their connector and the required one. This latter method is how Tesla

chooses to comply with the current requirements for SAE J1772 compatibility for Level 1 and

Level 2 charging.

4. PHEV Allowance and Minimum Technical Requirements

As noted earlier, a PHEV is defined as a vehicle that can draw propulsion power from

multiple on-board sources including an internal-combustion engine and a traction battery,

with the ability to charge the battery from an off-vehicle power source, such as the electric

power grid. Currently, PHEVs are required to have at least 10 miles all-electric range, meet

super-ultra-low-emission vehicle (SULEV) emission standards for the engines, and have an

extended warranty on emission-related parts. Currently, individual PHEVs earn a variable

amount of ZEV credits based on all-electric range and power capability and can be used to

meet less than half of a manufacturer’s annual ZEV requirement.

Consumer response to PHEVs has been mixed. As evidenced in the summary of market and

technology trends in section III.A.3., PHEV share of the electric vehicle market has declined in

recent years, with PHEVs accounting for 30-percent of new electric vehicles sold in the 2021

model year. Manufacturer projections, summarized in section III.C.1., indicate PHEVs will play

an even smaller role in the near future.

Staff, through the 2017 ACC Midterm Review, found consumer operation of PHEVs to be

highly variable, with a commensurate effect on actual emission reductions and electric vehicle

miles traveled. In looking through millions of data points on thousands of ZEVs and PHEVs,

staff concluded that electric vehicle miles traveled is highly driver dependent but generally

increases with vehicle electric power capability and electric range. Staff have also found the

296

Cleantechnia.com, 2018. “Tesla Model 3 In Europe Will Come With A CCS Charging Port” November 14,

2018. https://cleantechnica.com/2018/11/14/tesla-model-3-in-europe-will-come-with-a-ccs-charging-port/

Accessed January 11, 2022.

existence of high-power start emissions from PHEVs.

297, 298

According to CARB’s 2017 ACC

Midterm Review:

PHEVs could be a significant share of the fleet…and the light-duty vehicle sector

would still be on track to meeting its share of emission reductions for the 2030 and

2050 GHG goals. This is due in part to aggressive assumptions in the vehicle sector

including PHEVs achieving higher proportions of their miles on electricity, all gasoline

vehicles having significant gains in fuel efficiency over time, increases in renewable

energy usage, and slower growth in vehicle miles traveled (VMT) from all passenger

vehicles. Allowing PHEVs to have a larger role in the future fleet helps to provide

additional technology pathways toward meeting California’s long term goals.

However…emission benefits from PHEVs are not only affected by vehicle range and

architecture but are highly driver dependent, leading to significant uncertainty in

future projections.

299

Building upon these findings, staff developed its approach to PHEVs for the proposal. Staff

believes that PHEVs will still play a role in developing the ZEV market, especially when the

goal is 100-percent electrification by 2035. Studies show model diversity and availability are

key to driving consumer interest.

300,301

PHEVs may also remain a critical choice for low-income

drivers as well. According to data from the Clean Cars 4 All program, participants swapped

out older vehicles for a plug-in hybrid at four times the rate that they did for a BEV.

302

should be noted, however, that this data represents behavior at a time when very few vehicle

models were available to choose from and vehicles had shorter electric range than is

expected for the future. Accordingly, the preferences exhibited so far may be a reflection of

preferences for other vehicle attributes such as brand, seating or cargo capacity, or vehicle

size rather than the powertrain technology itself.

Staff believes that keeping PHEVs as a compliance option within the regulation will better

ensure success. However, GHG reduction targets and ambient air quality standards require

CARB to balance the risks and emissions from gasoline usage in PHEVs with the need to

keep PHEVs as an available option to truly achieve 100-percent of new car sales, expecting

some buyers will remain hesitant with fully electric vehicles. As shown in the 2020 Mobile

Source Strategy analysis, PHEVs had a limited role but remained in the sales projections and

297

CARB 2017f. California’s Advanced Clean Cars Midterm Review. Appendix G: Plug-in Electric Vehicle In Use

and Charging Data Analysis https://ww2.arb.ca.gov/sites/default/files/2020-

01/appendix_g_pev_in_use_and_charging_data_analysis_ac.pdf Released January 18, 2017. Accessed January

18, 2017.

298

Staff’s proposal related to changes in testing requirements at the time of certification for PHEVs can be

found in section IV.C.5..

299

CARB 2017g. California’s Advanced Clean Cars Midterm review: Summary Report for the technical Analysis

of the Light-Duty Vehicle Standards. Pg. 39-40. https://ww2.arb.ca.gov/sites/default/files/2020-

01/ACC%20MTR%20Summary_Ac.pdf Released January 18, 2017. Accessed January 28, 2022.

300

Morning 2021b. Lisa Martine Jenkins, “The Coming Electric Vehicle Wave: In 2022, Consumers Get Options”,

Morning Consult, Published December 22, 2021.

301

Consumer Reports 2020.

302

CARB 2021e

were assumed to have an electric fraction of total vehicle miles traveled (eVMT) of 70-percent

or more.

303

In addition to proposed changes to testing requirements for PHEVs, staff proposes to impose

stringent PHEV technical requirements that functionally emphasize the ZEV capabilities of

these vehicles. To that end, staff is proposing updated technical minimum requirements for

PHEVs to qualify to be counted toward a manufacturer’s annual ZEV requirement. Staff is

proposing a minimum 73 mile 2-cycle all-electric range, (equivalent to 50-mile real world

range), and the ability to do at least 40 miles on the US06 drive schedule, an aggressive drive

cycle to demonstrate the strength of the vehicle’s electric powertrain capability. This

minimum all-electric range requirement is sufficient to cover most driver’s daily driving

habits. For means 74-84-percent of new cars and trucks could meet their daily driving needs

on all-electric, based on an analysis using CARB’s EMFAC

304

model. Even with some

degradation, to 87-89-percent of cars and trucks could meet their daily driving needs on all-

election operation.

PHEVs with increased ranges are anticipated to replace PHEVs with less range due in part to

consumer demand for a more all-electric driving experience. Second generation PHEVs that

are now coming to market are offering more range than earlier generation vehicles, and are

discussed further in Appendix G.

In addition to minimum range requirements, 2026 and subsequent model year PHEVs need

to be certified to super ultra-low (SULEV) emission levels over its useful life

305

and have an

extended warranty on emission related components for 15 years or 150,000 miles (whichever

occurs first), which is in line with the current requirements for PHEVs counting toward a

manufacturer’s annual ZEV requirement. As would be required of BEVs, PHEVs would be

required at minimum to have a 5.76 kW onboard charger and be equipped with a 20-foot UL

certified convenience cord capable of both Level 1 and Level 2 electrical charging, discussed

in section III.C.3. Additionally, PHEVs only count toward the manufacturers’ requirements if

they comply with the durability, warranty, and battery label requirements described below.

Another conclusion regarding PHEVs from the 2017 ACC Midterm Review was that these

vehicles are highly dependent on driver behavior. Staff modeled the effect of high shares of

PHEVs with varying eVMT percentages. Staff concluded that though PHEVs can be a

significant share of the future fleet, there is a risk of increasing emissions if drivers do not

have high eVMT because they do not recharge their vehicles.

306

Therefore, staff is proposing

regulatory limitations that will help reduce additional risk of emissions associated with PHEVs.

303

CARB 2021a.

304

EMFAC is CARB’s on-road vehicle emission inventory tool. See https://arb.ca.gov/emfac/. It reflects

California-specific driving and environmental conditions, passenger vehicle fleet mix, and most importantly the

impact of California’s unique mobile source regulations. The current version, EMFAC 2021, is pending U.S. EPA

approval to meet transportation conformity and other planning requirements under the federal Clean Air Act.

305

SULEV useful life is defined as 15 years or 150,000 miles, whatever occurs first, per California Code of

Regulations, title 13, section 1961.3, and proposed section 1961.4.

306

CARB 2017h. CARB’s Advanced Clean Cars Midterm Review. Appendix F: Scenario Planning: Evaluating

impact of varying plug-in hybrid electric vehicle (PHEV) assumptions on emissions.

https://ww2.arb.ca.gov/sites/default/files/2020-01/appendix_f_ldf_scenario_planning_ac.pdf Released January

18, 2017. Accessed January 28, 2022.

Staff proposes that manufacturers will be able to fulfill no more than 20-percent of their

annual ZEV requirement with PHEVs. PHEVs produced in excess of that cap may be banked

for later use and expire after five years, mirroring staff’s proposal for ZEV credit life,

described in section III.C.2. At this time, staff sees little to no evidence of manufacturers

being limited by this cap based on confidential projections of sales obtained in the 2020 and

2021 alternative fuel vehicle survey, as evidenced in Figure 5. Additionally, PHEVs will likely

be a more expensive technology option for manufacturers to pursue, described in Chapter.

Staff’s analysis of cost impacts of the ACC II proposal within the fleet show BEV or FCEV

technologies are typically lower cost than PHEVs in most vehicle segments.

a) 2026-2028 All-Electric Range PHEV Phase-In

During development of staff’s proposal, manufacturers had concerns about PHEVs currently

certified, or on the cusp of being certified that fall just out of meeting those minimum

standards. As previously stated, most vehicles follow a 5-year design life, therefore vehicles

that have just now been introduced or are soon to be introduced will likely be produced

through the first few years of the proposed requirements for 2026 and later model years. As

shown in section III.C.4., and in the summary of all-electric ranges for current PHEVs,

manufacturers are continuing to bring PHEVs to market in more segments and with greater

electric capability. As a result, staff is including a 3-year phase-in option for 2026 through

2028 model year PHEVs with more than 30 miles all-electric range and that meet all other

proposed requirements for PHEVs. Manufacturers will earn partial credit, based on the

vehicle’s all-electric range and US06 capability, similar to the method in the current ZEV

regulation.

Staff is proposing to rescale the current PHEV formula to align with the future PHEV

requirement, with the built-in assumption that a 50-mile all-electric label range with US06

capability represents the maximum value of one vehicle. Staff proposes the all-electric range

would be divided by 100, as with the current equation, and then a value of 0.35 or 0.2 would

be added based on the ability of the PHEV to complete 10 miles all-electric range on the

US06 test cycle. For example, a PHEV with 40 miles of label range with US06 capability would

receive a value of three-quarters (or 0.75 = 40/100 + 0.35). These partial value PHEVs can be

used in the same way as other PHEVs to meet a manufacturer’s requirement, meaning they

would fall under the same 20-percent cap and have a 5-year life before expiring.

Table III-4: Summary of PHEV Minimum Technical Requirements

Attribute Current

ZEV Regulation

(2018-2025)

Transitional

<1 Credit

PHEVs

(2026-2028)

1 Credit

Earning PHEVs

(2026+)

Range >10 miles UDDS

cycle

>30 miles ‘label’ >50 miles ‘label’

Able to run US06

(high speed/accel) cycle

‘all-electric’

Optional

(added credit if >

10 miles US06

cycle)

Same (optional) Mandatory

(>40 miles

electric range)

Criteria emissions SULEV30 Same Same

Emission part warranty

15yr/150,000 mi

Same

Battery warranty

10yr/150,000 mi, no

threshold

8 yr/100,000 mi,

70% SOH

8 yr/100,000 mi,

70%/75% SOH

OBC size and J1772

Level 2

3.3 kW, J1772 Req

5.76 kW OBC,

Same J1772 Req

5.76 kW OBC,

Same J1772 Req

Convenience cord

No requirement

Required

5. Environmental Justice Allowances

As described in Section II.B, staff’s approach to environmental justice is multi-faceted. The

proposal overall will provide environmental justice benefits by reducing vehicle pollution in

communities throughout California, while the ZEV assurance measures will ensure the

emissions benefits are realized and long-lasting as ZEVs are assured to be reliable. As

California’s transportation system transitions to zero-emission, staff want to ensure that

everyone can access zero-emission transportation, including new and used electric vehicles.

Staff are therefore proposing environmental justice provisions that will further enhance ZEV

access.

Staff are proposing that optional environmental justice vehicle values be awarded to

manufacturers under the ZEV regulation who help increase affordable access and exposure

to ZEV technologies for priority communities. Not all of these crediting programs could be

implemented by all manufacturers if mandatory; however, staff anticipate broad usage of

these provisions given the increasing stringency of this proposal (leading to strong interest in

the use of these provisions optionally) and manufacturers’ need to continue to expand their

markets. In California, priority communities include neighborhoods that disproportionately

suffer from historic environmental, health, and other social burdens, including disadvantaged

communities

307

and low-income communities.

308

Due to historic discrimination, these

communities often include Black, Indigenous, and People of Color, households with low-

wealth status, and others who have limited awareness of or access to clean mobility options

and who are more likely to experience disproportionate impacts of climate change and poor

air quality.

309

307

Health and Safety Code section 39711 (added by Senate Bill 535 (De León, 2012)) charges the California

Environmental Protection Agency (CalEPA) with identifying disadvantaged communities “based on geographic,

socioeconomic, public health, and environmental hazard criteria.” CalEPA generally identifies disadvantaged

communities using the California Communities Environmental Health Screening Tool, known as

CalEnviroScreen, an important tool used to evaluate and quantify the environmental and health disparities

experienced by communities in California. Developed by the California Office of Environmental Health Hazard

Assessment, CalEnviroScreen uses environmental, health, and socioeconomic information to produce mapped

scores for communities across the state.

308

“Low-income communities” is defined in Health and Safety Code section 39713(d)(2) (added by Assembly Bill

1550 (Gomez, 2016)) as “census tracts with median household incomes at or below 80 percent of the statewide

median income or with median household incomes at or below the threshold designated as low income by the

Department of Housing and Community Development's list of state income limits adopted pursuant to Section

50093.”

309

UN 2016. United Nations. World Economic and Social Survey 2016: Climate Change Resilience—an

Opportunity for Reducing Inequalities https://www.un.org/sustainabledevelopment/blog/2016/10/report-

inequalities-exacerbate-climate-impacts-on-poor/ Released October 2016. Accessed January 31, 2022.

The environmental justice vehicle values are aimed at providing manufacturers with incentive

for targeted actions that would help achieve more equitable outcomes. The environmental

justice vehicle values proposed are allowed to be banked, traded, and used by manufacturers

in the 2026 through 2031 model years, further speeding affordable ZEV access in these

communities during the critical early years of the program. Staff is also proposing a 5-percent

cap on environmental justice vehicle values that could be used in any given year to fulfill a

manufacturer’s annual ZEV requirement under the regulation. After the 2031 model year,

ZEVs and PHEVs are expected to be the bulk of new vehicle sales, allowing these

environmental justice vehicle values to expire. Under the proposal, environmental justice

vehicle values can be earned in three ways and are discussed in the following sections.

a) ZEVs and PHEVs sold to a community-based clean mobility program at

a di

scount

The first environmental justice vehicle value option is focused on community programs and

intended to increase ZEV mobility and affordable access to clean transportation options for

California’s priority communities. Staff is proposing a way for manufacturers to support

priority communities’ access to ZEVs through these programs. Staff is proposing to include

provisions to allow manufacturers to accrue additional vehicle values for each new 2026

through 2031 model year ZEV or PHEV sold at a discount to qualifying community-based

clean mobility programs. Based on feedback from stakeholders, all new vehicles eligible

under this community program category must be offered at a minimum 25-percent discount

off the base manufacturer’s suggested retail price (MSRP) to earn these additional vehicle

values. Credit-able programs would include two programs now in effect in California and

could include other similar programs.

The Clean Mobility Options (CMO) Pilot Program, the first of these programs, provides

funding for two types of projects, Clean Mobility Projects and Community Transportation

Needs Assessments. The goal of the CMO Program is to improve clean transportation access

and to increase zero-emission and near zero-emission mobility choices for low-income and

disadvantaged communities. To receive CMO funding for clean mobility projects,

organizations must conduct a Community Transportation Needs Assessment before applying.

Needs Assessments are used to help identify and understand unmet mobility needs of

communities and develop solutions in collaboration with residents. Applicants can then apply

for up to $1,000,000 to launch and operate a clean mobility project such as ZEV carsharing,

ridesharing, ride-on-demand services, and innovative transit services. Mobility projects are

meant to bridge transportation gaps and provide connectivity between services and

locations. Eligible applicants are public agencies, nonprofit organizations, and tribal

governments. For example, using CMO funding and matching funds, the City of Los Angeles

Department of Transportation is implementing a carsharing pilot, known as BlueLA powered

by Blink Mobility, that includes the construction and installation of 100 carshare stations with

500 charge ports and operation of an electric vehicle carshare program with 300 electric

vehicles in disadvantaged communities within the City of Los Angeles.

310

CARB 2021f. California Air Resources Board. Low Carbon Transportation Investment Project Summaries.

https://ww2.arb.ca.gov/sites/default/files/2021-10/fy21-22_fundingplan_appendix_g.pdf Released October

2021. Accessed January 31, 2022.

The Sustainable Transportation Equity Project (STEP), the second program, is a new pilot that

takes a community-based approach to overcoming barriers to clean transportation in

disadvantaged and low-income communities throughout California. STEP provides two types

of grants: Planning and Capacity Building Grants and Implementation Grants. STEP aims to

address community residents’ transportation needs, increase residents’ access to key

destinations (e.g., schools, grocery stores, workplaces, community centers, medical facilities),

and reduce greenhouse gas emissions. STEP requires that projects rely on the knowledge

and expertise of residents through all phases of project design, implementation, and

evaluation and has the flexibility to fund many different types of projects to ensure that STEP

funds can help meet the needs of each community within that community’s context. For

example, using STEP funding, the Stockton Mobility Collective will help meet the

transportation needs of its community by implementing a carsharing project with 30 BEVs.

311

With regard to these or similar programs, a manufacturer can earn an additional vehicle value

of 0.50 for each ZEV provided at a discount to a qualifying community program and an

additional 0.40 value for each PHEV. PHEVs are only eligible for vehicle models with a 6-seat

capacity or more. Currently, there are over 20 models of BEVs and FCEVs that provide

various options to meet community program needs. Yet, there are not many options for pure

ZEVs with more than 5 seats. By allowing PHEVs at this vehicle size, community programs

have a few more options, such as today’s Chrysler Pacifica and Mitsubishi Outlander PHEVs.

While CMO and STEP programs would automatically qualify for manufacturers to receive

environmental justice vehicle values, staff is also proposing eligibility criteria for other

community-based clean mobility programs to qualify. The program must include community-

identified mobility options that increase access to clean transportation and zero-emission

mobility for communities. Some of these mobility programs may include electric car sharing,

ridesharing, vanpools, innovative transit services, or other clean mobility options as identified

by the community. To help ensure that the community program meets the needs of the

community, the program must be implemented by a community-based organization or

Native American Tribe. The community program may also be implemented by a public

agency or nonprofit organization that has received a letter of support from a community-

based organization or local community group. A manufacturer may request from the

Executive Officer (or their counterpart in a state adopting this regulation) a determination

that a program qualifies as a community-based clean mobility program by providing

applicable information about the program and an attestation from a responsible official of

the program implementer.

b) Additional Vehicle Value for ZEVs and PHEVs coming off-lease in

California and delivered to a California dealership for purposes of participating in

a low-income used ZEV financial assistance program.

As discussed further in section III.A.6., used vehicles are important for enabling greater

access to the cleanest technologies for California’s low-income and disadvantaged

communities. Approximately 70-percent of consumers purchase used cars, but the median

income of used electric vehicle buyers in California is significantly higher than incomes of

311

CARB 2022f. California Air Resources Board. Sustainable Transportation Equity Project (STEP)

Implementation Grant. https://ww2.arb.ca.gov/lcti-stockton-mobility-collective. Accessed January 31, 2022.

used gasoline vehicle buyers.

312,313

Used vehicles are often more affordable, both in terms of

upfront acquisition cost and ongoing registration and insurance costs. The savings varies

among models but, on average, used electric vehicles cost 43 to 72-percent less than new

ones.

314

With more reliable and durable used ZEVs on the market post-2025 due to the

proposed ZEV assurance measures, used ZEVs may help increase access and exposure to the

technology.

Leased vehicles are owned by a leasing company, which is typically a financing arm or entity

of the vehicle manufacturer. Vehicles enter the used market in various ways, including

vehicles coming off of a lease (i.e., returned to the leasing company when the lease term

ends). Nationwide, about 1 in 4 new vehicles are leased and not purchased.

315

However,

CVRP

316

statistics of subsidies for drivers to purchase or lease ZEVs show 70-percent of BEVs

have been leased.

317

This is consistent with other findings that vehicle leasing tends to be

higher for newer technologies.

318

While the percent of leased ZEVs may decrease over time,

newly off-lease vehicles can provide great value in the used vehicle market.

Because leasing companies often are a financing arm of the vehicle manufacturer itself or

otherwise have some form of agreement with the manufacturer to be the lease holder,

manufacturers typically have some control on where the formerly leased vehicles end up

through their off-lease auctioning process. For example, at the end of a lease term, the

original lessee (consumer) typically has the right of first refusal to purchase the vehicle. If the

lessee declines, then the receiving dealership (where the vehicle was turned in at the

conclusion of the lease) is often given the option to purchase the vehicle for resale;

otherwise, the vehicle is usually set up for auction to other dealerships.

CARB currently funds two programs that help make clean vehicles accessible and affordable

for low-income and disadvantaged communities – Clean Cars 4 All and the Financing

Assistance for Lower-Income Consumers Program. Clean Cars 4 All is a program that focuses

on providing incentives to lower-income California drivers to scrap their older, high-polluting

car and replace it with a zero- or near zero-emission replacement. The Financing Assistance

for Lower-Income Consumers Program provides grants and affordable financing to help

lower-income consumers purchase or lease a new or used hybrid or electric vehicle. Through

2020, approximately 75-percent of Clean Cars 4 All grants have been awarded for used

vehicles, with some regions, such as the San Joaquin Valley, higher than this average with 97-

312

Consumer Reports 2019. New survey shows strong support for electric vehicles across economic spectrum.

https://advocacy.consumerreports.org/press_release/evsurvey2019/ July 2019. Accessed January 31, 2022.

313

Turrentine 2018.

314

Edmunds 2018.

315

NADA 2021b. National Automobile Dealers Association. NADA Data 2021: Annual Financial Profile of

America’s Franchised New-Car Dealerships.

https://www.nada.org/WorkArea/DownloadAsset.aspx?id=21474864928 Accessed January 31, 2022.

316

The Clean Vehicle Rebate Project (CVRP) promotes clean vehicle adoption in California by offering rebates

from $1,000 to $7,000 for the purchase or lease of new, eligible ZEVs and PHEVs. (See

https://cleanvehiclerebate.org/en/cvrp-info.) It is administered under Health & Saf. Code, § 44258.4.

317

CSE 2022. Center for Sustainable Energy for the California Air Resources Board Clean Vehicle Rebate

Project. Rebate Statistics. Data last updated February 2,2022. https://cleanvehiclerebate.org/en/rebate-

statistics Retrieved February 2, 2022

318

ICCT 2021b. Tankou, A., Lutsey, N., & Hall, D. The International Council on Climate and Transportation.

Understanding and Supporting the Used Zero-Emission Vehicle Market. https://theicct.org/wp-

content/uploads/2021/12/ZEVA-used-EVs-white-paper-v2.pdf December 2021. Accessed January 31, 2022.

percent of used vehicles in the program. In analyzing data from the Clean Vehicle Assistance

Program, staff also found that used vehicles also tend to be purchased at higher rates by our

lowest income consumers.

319

In CARB’s ACC Midterm Review, staff noted that of the electric vehicles originating in

California, a greater share was transferred to other states when compared to gasoline cars,

suggesting that there may be a higher demand for (or more limited supply of) used ZEVs in

these states and that electric vehicles may be migrating out of the state at faster rates than

conventional cars.

320

Likewise, for electric vehicles originating in Section 177 ZEV states,

historically a sizeable share was transferred to other states and at a greater rate than

gasoline-only vehicles are transferred. The re-sorting of used electric vehicles across states

often results from the activity of dealerships who purchase the used electric vehicles from

previous owners or reclaim ownership after the end of a lease. Rather than selling the car on

their own used car lot, dealers will often sell the car to another dealer via an auction

clearinghouse.

Staff are proposing that ZEVs and PHEVs originally leased in California with an MSRP of less

than or equal to $40,000 when new, adjusted for inflation, can earn an additional 0.10 vehicle

value, if the vehicle is subsequently sold to a dealership participating in a financial assistance

program for used ZEVs, including Clean Cars 4 All and the Clean Vehicle Assistance Program.

The proposal aims to increase the supply of vehicles to dealerships participating in these

programs, thereby increasing access to more affordable used ZEVs for consumers. To qualify,

these off-lease ZEVs and PHEVs must be 2026 through 2028 model year vehicles. This is

important because starting in the 2026 model year and beyond, ZEVs and PHEVs will need to

meet more stringent ZEV assurance requirements and technical requirements, which means

greater certainty of used ZEVs and PHEVs that will meet drivers’ needs.

As noted, these off-lease ZEVs and PHEVs must have had an MSRP value equal to or lower

than $40,000 when they were new.

321

This provision captures the intent of increasing access

to more affordable ZEVs. Staff’s proposal is that this MSRP value would be determined by

the minimum base model price. Most BEVs and PHEVs available would be eligible, while

vehicles excluded will largely be higher end luxury class vehicles, such as many of those from

BMW, Jaguar, Mercedes Benz, as well as Tesla Models S and X.

This environmental justice vehicle value category would follow the same phase-out in 2031 as

the other optional environmental justice allowances. As proposed, vehicle values can only be

generated by model year 2026 through 2028 vehicles, which would likely be earned in 2029

through 2031 calendar years as they finish a typical three-year lease term. For example, a

model year 2026 BEV leased for three years would be returned in 2029 calendar year. If the

BEV was then sold to a California dealership that participates in an eligible financial

assistance program, the manufacturer would earn an additional 0.10 environmental justice

vehicle value in 2029.

319

CVAP 2022. Clean Vehicle Assistance Program. Program Learnings & Data Transparency.

https://cleanvehiclegrants.org/program-data/. Accessed January 31, 2022.

320

CARB 2017d

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MSRP as defined by US Code, title 15, section 1232(f)(1)

c) Low MSRP ZEVs and PHEVs

As previously stated, the early adopter ZEV market has generally excluded priority

communities. Adoption of both new and used electric vehicles in disadvantaged communities

occurs at very low rates – 5.7-percent and 8.7-percent of electric vehicle sales, respectively.

322

Owners of electric vehicles in disadvantaged communities tend to have lower income than

electric vehicle owners in non-disadvantaged communities.

323

As discussed in section III.B.5,

lower income households represent a much larger share of gasoline vehicle purchases

compared to electric vehicle purchases.

324

Furthermore, when counting both new and used

vehicle purchases, Black and Latino car buyers account for 41-percent of gasoline vehicle

purchases, but only 12-percent of electric vehicle purchases.

325

At the same time, research

has shown that savings from ZEVs relative to income are significantly higher for low-income

households, Black, Indigenous, and People of Color, and households in areas with higher

levels of pollution.

326

To help address this electric vehicle adoption disparity, staff is proposing to increase

affordable access to ZEVs and PHEVs by providing an incentive for manufacturers to offer

lower priced vehicles. This is especially important in the earlier years of the proposed ACC II

program when battery costs are higher. Incremental vehicle costs of ZEVs and PHEVs are

anticipated to remain above the cost of conventional vehicle technology in the near term and

through the first few years of the ACC II program. These higher costs are likely to be passed

onto consumers and reflected in part or in whole in the price of new vehicles. Affordability of

ZEVs and PHEVs, particularly the upfront vehicle price, is one of the biggest barriers for

consumers deciding on whether to purchase an electric vehicle over an ICEV. Cost reductions

in new ZEVs could also lead to decreased used ZEV prices and cost parity for low-income

households, where the higher rates of depreciation for first owners will lead to larger benefits

for second owners.

327

Staff is proposing that a 2026 through 2028 model-year ZEV or PHEV delivered for sale with

an MSRP less than or equal to $20,275 for passenger cars and less than or equal to $26,670

for light-duty trucks can earn an additional 0.10 vehicle value. Each of these MSRP values will

be recalculated to adjust for inflation on an annual basis. Passenger cars include vehicle

classes such as sedans, hatchbacks, and station wagons, and light-duty trucks include vehicles

such as SUVs, minivans, and pickups.

328

To avoid the risk that incentivizing lower priced ZEVs

322

Canepa et al 2019.

323

Canepa et al., 2019

324

Muehlegger et al., 2018.

325

Muehlegger et al., 2018.

326

ICCT 2021b.

327

Busch 2021. Busch, C. Energy Innovation Policy & Technology LLC. Used Electric Vehicles Deliver Consumer

Savings Over Gas Cars: Policy Implications and Total Ownership Cost Analysis for Non-Luxury Used Cars

Available To California Consumers Today. https://energyinnovation.org/wp-content/uploads/2021/06/Used-

Electric-Vehicles-Deliver-Consumer-Savings-Over-Gas-Cars.pdf June 2021. Accessed January 31, 2022.

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“Light-duty truck” means any 2000 and subsequent model motor vehicle certified to the standards in section

1961(a)(1) or 1961.2 rated at 8,500 pounds gross vehicle weight or less, and any other motor vehicle rated at

6,000 pounds gross vehicle weight or less, which is designed primarily for purposes of transportation of

property or is a derivative of such a vehicle or is available with special features enabling off-street or off-highway

operation and use.

and PHEVs could result in vehicles with inferior electric drive systems, staff is proposing that

eligible vehicles be model year 2026 or later to ensure the vehicles meet the proposed

minimum technical requirements and ZEV assurance measures.

Under federal statute, every manufacturer of new automobiles distributed in commerce must

affix to the windshield or side window a label containing information concerning the vehicle,

also known as the Monroney sticker.

329

Part of the required information includes the retail

price suggested by the manufacturer, the retail delivered price for each accessory or optional

equipment, the amount charged for delivery of the vehicle to the dealer, and the total price.

MSRP for this proposal means the base retail price of the vehicle suggested by the

manufacturer;

330

it does not include options or destination charges.

Staff analyzed the MSRP of model-year 2021 passenger cars and light-duty trucks currently

registered in California with the Department of Motor Vehicle (DMV) to set the MSRP

thresholds. The DMV information does not include MSRP for additional options or upgrades

to the base model; however, it is possible to differentiate between the trim levels of a given

vehicle model. The MSRP values derived from this analysis were based on the 2021 model

year and accordingly, may be inappropriate to achieve the same purpose in the 2026 and

subsequent model years. By adjusting the values with a consumer price index (CPI) published

by the United States Bureau of Labor Statistics specific to new vehicle prices, the MSRP value

should better track the intended target of the lowest 10th percentile for the 2026 through

2028 model years.

331

6. Early Compliance Values

Staff’s proposal requires 35% of new vehicles delivered to California to be ZEVs or PHEVs in

2026 model year. The Midterm Review showed manufacturers could deliver 7% in the

Section 177 ZEV states, and at 8% in California, of new vehicles as ZEVs and PHEVs and still

be in compliance with a significant bank of credits in 2026 model year. Current compliance

after 2021 model year shows manufacturers to be on track with those 2017 predictions in the

States, and far above that path in California.

332

This proposal is intended for manufacturers to

deliver greater volumes of ZEVs and PHEVs as early as possible, to ensure a path toward

proposed increased requirements starting in 2026 model year.

One of the bases for staff’s ZEV stringency proposal was the manufacturer generated 2021

projections, summarized in Figure 3, of projected sales in 2023, 2024, and 2025 model year.

At an individual level, manufacturers showed varying levels of ZEV and PHEV sales in those

years, building on 12% California sales volume in 2021 model year.

However, given the current state of car production and sales worldwide, there could be

setbacks that may affect these projections. Additionally, as mentioned in Section III.A.2,

329

Gov Info 2022. 15 U.S.C. 1232 - Label and entry requirements.

https://www.govinfo.gov/content/pkg/USCODE-2011-title15/pdf/USCODE-2011-title15-chap28-sec1232.pdf.

Accessed January 31, 2022.

330

as defined by US Code, title 15, section 1232(f)(1)

331

BLS 2022. CPI for All Urban Consumers, new vehicles index, new vehicles in U.S. city average, all urban

consumers, not seasonally adjusted, U.S. Bureau of Labor Statistics,

https://data.bls.gov/timeseries/CUUR0000SETA01

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CARB 2017e.

supply shortages in critical minerals may have an effect in the near term. Staff is proposing a

regulatory mechanism that incentivize manufacturers to deliver on those projections prior to

the start of the new regulation requirements, and a potential way to bring up sales in the

worse-case scenario if setbacks continue.

The proposal rewards progress above current market shares, and thus is calibrated to award

value depending on sales averages in states with greater or lesser current market

development – thereby rewarding progress in states still coming up to speed, or accelerated

progress in more developed markets, while not diluting overall regulatory requirements. Staff

proposes to allow manufacturers who deliver for sale more than 20% new vehicle sales on

average in in the two model years prior to the new ZEV regulation requirements, in a state

that has a total sales average above 7% ZEVs and PHEVs in 2020 through 2022, may

optionally bank values associated with those vehicles above 20% sales for use in 2026

through 2028 model year. For those states that have a 2020 through 2022 ZEV and PHEV

sales average below 7%, manufacturer who deliver for sale more than 7% new vehicle sales

on average in the two model years prior to the new regulation requirements can earn values

to use in first three years after the new ZEV regulation requirements commence. These early

compliance values may meet up to 15% of a manufacturer’s annual ZEV requirement and are

treated as though they were earned in the model year. For example, a manufacturer with an

obligation of 100 in 2026 model year could fulfill its obligation with 85 ZEV values from 2026

model year and 15 ZEV values from 2024 and 2025 model years.

7. SVM treatment

Staff propose to treat “small volume manufacturers” – essentially makers of custom and

specialty vehicles like some high-end sedans – slightly differently. Because small volume

manufacturers often certify only one or two test groups representing less than 3-percent of

California’s light-duty vehicle market and have fewer resources for development of new

products, staff proposes to require manufacturers who deliver for sale less than 4,500 light-

duty vehicles annually in California to submit a compliance plan by the end of 2032 and to

meet the requirement no later than the 2035 model year. This would ensure a path for all

manufacturers certifying light-duty vehicles in California to be in compliance with 100-percent

ZEV or PHEV sales beyond the 2035 model year but provide significant flexibility in

recognition of the unique situations of each of these manufacturers and their limited product

offerings. Many of these high-end manufacturers have introduced plans for a ZEV model, as

shown in the complete list of upcoming models in Appendix G.

8. Summary of ZEV Regulation Proposals

Overall, staff’s ZEV regulation proposal reflects a balance of stringent annual ZEV

requirements, minimum technology requirements, and appropriate flexibilities that will put

California, and the states that adopt California’s ZEV regulation on a path to 100%

electrification by 2035 model year.

Table III-5: Summary of ZEV Regulation Proposals

Proposal Category Description of Proposal

ZEV minimum

requirements

150-mile label range, propulsion-related parts warranty,

battery warranty, data standardization, charging cord, battery

label, service information

PHEV

minimum requirements

50-mile label range, 40-mile US06 range, SULEV, 15-

ear emissions warranty, battery warranty, charging cord,

battery label

ZEV and PHEV Vehicle

Values and Life

Counted as one vehicle value, 5-year value life

PHEV Phase in 2026-2028 30-mile label range, partial vehicle value

PHEV Cap 20% of annual requirement

Environmental Justice (EJ)

Vehicle Values

5% of annual requirement through 2031 MY

1. 0.5 value for ZEVs and 6-passenger PHEVs offered at

25% price discount to car share community programs

2. 0.1 value for off-lease (<$40k MSRP) ZEV and PHEVs

delivered to CC4A and CVAP dealers

3. 0.1 value for low MSRP ZEVs and PHEVs (<$20k Cars,

< $27K Trucks)

Early Compliance Values 15% of annual requirement through 2028 MY

OEMs with >20% EV market share in 2024 and 2025 can

generate ACC II credits early

Historical Credit Treatment

(ACC I)

2025 MY Balance / 4 = Converted ZEV Values

2025 MY Balance / 1.1 = Converted PHEV Values

Converted ZEV and PHEV

Values

15% of annual requirement (if shortfall) through 2030 MY

Pooling

Excess values can count toward compliance, up to 25%

(2026) down to 5% (2030) of annual requirement (if shortfall)

in CA or Section 177

Allowed Deficit Can carry forward deficit for 3 years

Small Volume

Manufacturers (SVM)

Must comply 2035+ MYs

D. ZEV Assurance Measures

The ACC II proposal is intended to meet multiple requirements and goals to reduce air

pollution, protect public health, and stabilize the climate over the long term. Its success over

the long term is dependent on ZEVs and PHEVs permanently displacing all new conventional

internal combustion gasoline and diesel engine vehicle sales in California by 2035 and

sustaining consumer use of such vehicles over their full useful lives to permanently eliminate

emissions from conventional vehicles. This means that the ZEV vehicle fleet is critical to

pollution control, and if they fail to meet the drivers’ needs, a ZEV may be replaced with a

new or used conventional vehicle – a concern that has been observed in ZEV discontinuance

and that intensifies as ZEVs age and compete on the used vehicle market. CARB has long

designed its regulations and certification systems to ensure that vehicles, including their

emission controls, perform properly throughout their life. In the ZEV context, this proposal

continues that approach. To secure the emission benefits of this proposal, ZEVs must meet

continuing assurance requirements throughout their lives.

As staff worked through its proposal, it became clear that there would need to be targeted

measures designed to ensure these ZEVs and PHEVs remain a viable choice for all

consumers. These measures focus on the vehicle characteristics needed to ensure that an

ordinary new vehicle consumer chooses and retains a ZEV and replaces a gasoline vehicle

within their household fleet, and that used vehicle purchasers can make the same choice. To

this end, staff is proposing requirements for durability, warranty, battery labeling, and

serviceability, which are collectively called the ZEV assurance measures. These measures

individually and collectively reduce emissions by ensuring that the vehicles perform as

needed to fully and permanently displace ICEVs, providing consumer confidence and

reliability so that ZEVs penetrate both the new and used vehicle markets.

Such requirements also have important distributional equity implications, as they can assure

the performance of vehicles bought used – when most people buy vehicles – and when

vehicles are more affordable for lower-income consumers. Thus, the ZEV assurance measures

can support access to reliable ZEVs in communities that may not be buying new vehicles, but

which do need reliable, durable, and clean mobility options.

CARB has a long history of ensuring vehicles meet emissions standards over their lifetimes.

Currently, ICEVs are required to not only meet criteria pollutant standards, but can be

recalled if they do not meet certification standards throughout the vehicle’s defined useful

life, which are broadly called durability standards. Manufacturers are also required to provide

a minimum warranty on the emission control systems, and vehicles must be equipped with

onboard diagnostics (OBD) to track and diagnose emission failures over the defined useful

life of the vehicle. Lastly, manufacturers must provide repair information and make available

the necessary tooling to non-dealer repair shops. Together these requirements help to

control the emissions of the ICEVs over the life of the vehicles and ensure that emission

control failures are diagnosed and able to be repaired quickly.

The aforementioned regulatory requirements apply to vehicles with emissions. CARB has not

previously applied these requirements to ZEVs. Currently, the only law that provides

consumers with some protections in the event of a faulty ZEV is California Civil Code, section

1793.2, more commonly known as the “Lemon Law.”

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This applies to vehicles that are

defective and cannot be repaired after a “reasonable” number of attempts or length of time.

The Lemon Law is limited, as it only applies to new vehicles purchased or leased that are still

under a manufacturer’s new vehicle warranty. Though this law serves an important consumer

protection function, it does not address how usable a vehicle is over its life. The current legal

gap in protections for aspects of ICEVs and ZEVs that implicate emissions could seriously

impair ZEV adoption unless corrected, as consumers desire confidence that their vehicles will

function properly over the vehicles’ entire lifetime. CARB’s regulatory authorities allow for an

important gap-filling set of measures, consistent with CARB's long history of including

consumer assurance provisions that protect emissions benefits, in this proposal to ensure

consumers’ ZEV uptake that displaces ICEVs.

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The ACC II requirement for ZEV assurance measures is intended to support ZEV

displacement of ICEVs by making electric vehicles competitive with the durability, warranty,

and serviceability car owners have come to expect with traditional gasoline vehicles. Car

buyers currently view electric vehicles as lacking compared to traditional gasoline

counterparts, and they have concerns about higher maintenance costs, fewer mechanics to

fix issues, and faster depreciation.

335

Reservations also persist regarding battery life and the

costs associated with battery replacement.

336, 337, 338

For new car buyers who anticipate

eventual resale on the used market, fear of faster depreciation may generate concern about

salability and resale value. Similar uncertainty is further amplified in the used market since

used buyers are less likely to consider electric vehicles.

339

Used car buyers appear to want to

limit their financial risk and are shown to purchase more protection products, like extended

warranties, tend to be on tighter budgets, and have lower credit ratings.

340

ACC II requirements to guarantee access to service information, assure minimum durability,

and provide the protection of minimum warranties will help build confidence that a

technology switch to reduce emissions is manageable and safe. The proposed ZEV assurance

measures are designed to function both individually and collectively to promote consumer

uptake and retention of ZEVs and protect the emissions benefits of ACC II. No single

measure could address all technical aspects of ZEV operation and performance to ensure that

they effectively displace conventional engines and their emissions, along with all related

333

California Civil Code, section 1793.2 et seq.

334

Statute requires CARB to adopt rules and regulations that are necessary, feasible, and cost-effective and

achieve the maximum emissions reductions to meet federal and State ambient air quality and State GHG

emission obligations. (E.g., Health & Safety Code, §§ 38560, 39602.5, 43013, 43018, 43018.5, 43101, 43104,

43105.5, 43205, 43210.5.) These mandates are not limited to direct emission standards or controls but also

include, for example, data reporting, durability and performance improvements, warranty measures, and

compliance procedures. (Ibid; see also Engine Manufacturers Association v. State Air Resources Board (2014)

231 Cal.App.4th 1022, 1036-37.) CARB is further obligated to “adopt standards, rules, and regulations” and

“do such acts as may be necessary for the proper execution of the powers and duties granted to, and imposed

upon, [it].” (Health & Safety Code, §§ 39600, 39601.)

335

MacInnis 2020.

336

Cox 2021a.

337

MacInnis 2020.

338

Cox 2019. Cox Automotive, “Overcoming Electric Vehicle Misconceptions is Crucial to Converting

Consideration to Sales” (Press release), Published August 19, 2019. Accessed February 11, 2022.

339

Hardman 2021.

340

Ellencweig et al., 2019.

consumer priorities and concerns. The proposed ZEV assurance measures are necessary to

address varied operating characteristics and consumer needs and priorities for household

transportation: durability for vehicle longevity and value retention; warranty for vehicle

longevity and peace of mind in avoiding costly unexpected repairs; and data availability for

transparency to drivers and prospective used vehicle purchasers, reassurance about vehicle

component health, and availability and convenience of service options. Combined, these

measures help ensure that ZEVs meet consumers’ needs for household transportation so that

consumer ZEV adoption will be sufficient to reduce emissions as intended and combustion

engines will be displaced. This is key for ZEV technologies to be widely adopted as a trusted

choice in both the new and used vehicle markets.

1. On-Vehicle Data Standardization

Access to data has been an important cornerstone of CARB regulations for gasoline vehicles,

and it will continue to be important for ZEVs and PHEVs as the market grows. Staff sees this

importance throughout the life of the vehicle. First, purchasers of a ZEV have a right to

understand the vehicle’s need for repair and warranty qualifications. Prospective drivers,

especially in the used vehicle market, should have the ability to evaluate the state of the

vehicle and health of the battery (a high-cost component for repair) to encourage them to

purchase a ZEV over a conventional vehicle and to be able to appropriately value individual

used ZEVs. Repair technicians, particularly independent technicians, need to be able to

access vehicle data, diagnostic tools, and manufacturer developed diagnostic and repair

information to assess the vehicle’s need for repair and carry out necessary repairs

appropriately. Those in the battery repair or reuse industry need key data from the battery

management system to better assess the remaining life of the battery and potential second

life applications. CARB also has use for vehicle data for a suite of reasons including being

able to carry out official tests, to understand in-use operation to ensure official tests are

representative of such operation, to better understand impacts on the grid to refine future

actions and policies, and to enable future in-use compliance test programs to ensure the

regulations achieve their intended outcome of reducing emissions.

One key metric staff is proposing to be implemented on 2026 and subsequent model year

BEVs is a “state of health” of the battery. The purpose of this metric is to disclose to the

driver, to a repair technician, a prospective buyer, or to a battery rebuilder or re-purposer,

the current level of deterioration in the battery relative to when it was new. Staff propose for

battery state of health to be correlated to usable battery energy; a specific quantity that is

determined by defined testing procedures carried out in a laboratory in accordance with the

procedures of SAE J1634. This SAE procedure was developed by industry, agency, and

laboratory representatives for the purposes of testing electric vehicles and has been refined

over the years. It is also the basis for all electric vehicle testing required by CARB and the

U.S. EPA for certification of electric vehicles. With the proposal, the reported battery state of

health would be required to report a value normalized from 0 to 100-percent (when the

battery is new) and representing a usable battery energy that is no more than 5-percent

higher than the actual usable battery energy determined from testing. Lastly, staff proposes

that, in addition to this state of health being accessible by a standardized automotive service

tool, that it would also be able to be displayed to the driver, in vehicle, without the use of a

tool (e.g., through a dashboard display), and that this metric be linked to the minimum

battery warranty requirements, further discussed in section III.D.3. The information provided

by this parameter would provide consumers (particularly potential used vehicle purchasers)

with certainty about the remaining life of the battery or its current capability in a readily

understandable format.

Along with state of health of the battery, staff propose additional data parameters and

commands that must be standardized and accessed through a common vehicle connector

and scan tool. The parameters include data such as vehicle speed and battery voltage and

current needed to properly quantify the performance of the vehicle during testing. The data

also include a set of historical data to track key parameters such as total energy into the

vehicle and average energy usage during driving to verify certification data is representative

of in-use operation and to be able to track degradation that may occur over time. Lastly, the

standardized commands include the ability for repair technicians to read propulsion-related

fault codes when a problem has been detected by the vehicle. This requirement ensures that

independent technicians have access to basic information needed to help diagnose and

repair vehicles, which further supports consumer confidence in purchasing new and used

ZEVs.

To facilitate manufacturers implementation of these standardized data requirements, the

proposal includes a two-year phase-in where 40-percent of a manufacturer’s 2026 model year

applicable vehicles and 100-percent of the 2027 model year would be required to meet the

requirements. As with many phase-ins, an allowance exists for manufacturers to implement

an alternative phase-in as long as it achieves an equivalent introduction of vehicles by the

2027 model year. Small volume manufacturers are exempt from the phase-in and provided

an extra year to be compliant (no later than the 2028 model year). Further, as the

requirements include a multiple data parameters, the proposal includes a deficiency

provision whereby, in the 2026 through 2029 model years, manufacturers can still certify a

test group as meeting the requirements even if it falls short of fully implementing all of the

parameters. This provision, which is similar to provisions for internal combustion engine

vehicles in the onboard diagnostic regulations, provides additional flexibility for

manufacturers in the first four years of implementation to manage the roll-out across their

product line at a time when they are both introducing new ZEV models and refreshing or

redesigning existing ZEV models. The deficiencies are only available for shortfalls in the data

parameters that and cannot be used to certify vehicles that fail to implement the required

connector, communication protocol, or the requirement to display to the driver the battery

state of health information and the rate of charging information. These elements are critical

pieces to both data standardization and to increasing transparency to vehicle owners to

facilitate consumer acceptance of ZEVs.

2. Durability

Today’s gasoline vehicles are required to not only meet criteria pollutant standards when

new but throughout the vehicle’s defined useful life.

341

This effectively ensures a minimum

durability of the vehicle’s emission controls and thus, acceptable emission performance for

that period of time and miles. Currently, light-duty vehicles are designed and certified to stay

below specific emission levels for a useful life of 15 years or 150,000 miles, whichever occurs

first. Manufacturers are also required to test in-use vehicles within each test group as the cars

age to verify they are meeting the standard. CARB also carries out such testing and, if a

341

E.g., California Code of Regulations, tit. 13, §§ 1961.2, 1968.2, 1968.5.

representative sample of vehicles within a test group indicates the test group as a whole has

a problem, CARB can require appropriate remedies to bring that test group into compliance

with the standard including recall.

ZEVs have not previously been brought into these types of requirements because volumes

have been low, the technology has been evolving, and the resultant air quality consequences

of a non-durable ZEV were far less than that of a gasoline vehicle with tailpipe emissions.

Knowing the long-term air quality needs for ZEVs required bringing the vehicles to market

sooner than they would be developed on their own, staff has prioritized providing time for

the technology to mature and manufacturers to gather data crucial to furthering the

technology. To support a full transition to clean technology in the new and used light-duty

fleet and be successful in dramatically reducing emissions, however, it is necessary to ensure

ZEVs have adequate durability to meet consumers’ expectations.

342

Failing to do so would

unnecessarily risk continued consumer hesitancy to accept the new technology, further

delaying or weakening the needed transition to clean vehicles. In addition to increased

consumer confidence, creating durability requirements for batteries will lead to reduced

battery degradation and therefore less battery replacements. This has a benefit of reducing

battery manufacturing impacts of facility emissions and sourcing of raw minerals, as well as

slowing down the need for battery recycling and reuse activities.

Accordingly, staff proposes that BEV and FCEV test groups must be designed to maintain 80-

percent or more of the original (as new) certified combined city and highway test range (see

section III.C.3. for minimum technical requirements for ZEVs) for 10 years or 150,000 miles,

whichever occurs first. With this requirement, vehicle owners could have reasonable

confidence in the level of degradation in battery capacity, and thus range, that they may see

during their term of ownership of the vehicle rather than be faced with uncertainty that might

dissuade them from ZEV ownership. Based on discussions with vehicle manufacturers,

suppliers, and review of continued development, most manufacturers appear poised to meet

this requirement, for an average consumer, on newly introduced products. And with further

improvements in battery chemistry, construction, battery management, and thermal

management during usage and charging in the lead time provided by this proposal, staff

expects all manufacturers will be able to meet this requirement in 2026 and subsequent

model years.

Battery state of health data for Nissan Leaf vehicles from the 2013 through 2019 models

showed that the later models had reduced battery degradation, due to improved battery

management strategies and battery technology. The 2013 model had 3-percent degradation

the first year and 8.9-percent degradation by the third year whereas the 2016 model had 2.3-

percent degradation the first year and 6.9-percent degradation by the third year. The 2017

model had 2-percent degradation the first year showing even further improvement from

previous years. From this same database, an average decline across the 21 vehicle models is

2.3-percent per year which can translate to a 150-mile range vehicle losing 17 miles after 5

years.

343

While this reflects a level of degradation that would not meet the proposed

342

E.g., Health and Safety Code, §§ 38560, 39601, 39602.5, 43013, 43018, 43018.5, 43101, 43104, 43106.

343

Geotab, 2020. “What can 6,000 EVs tell us about EV battery health” Originally published on December 13,

2019. Updated July 7, 2020. https://www.geotab.com/blog/ev-battery-

health/#:~:text=First%20and%20foremost%2C%20based%20on,usable%20life%20of%20the%20vehicle.

Accessed February 11, 2022.

requirement, it shows the trend in year over year improvements that are being made to

reduce degradation as manufacturers continue to gain knowledge about the operating

conditions most harmful to batteries and optimize the control and thermal management

systems to minimize or outright eliminate the circumstances that lead to those operating

conditions.

Over 1 million Tesla Model S and X vehicles showed less than 15-percent battery

degradation, on average, for vehicles that drove between 150,000 and 200,000 miles by

2019,

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and by 2020 these vehicle batteries degraded approximately 10-percent on average

after 200,000 miles traveled.

345

Tesloop, which is a Tesla rental company in Southern

California, operated a Tesla Model X 90D with 350,000 miles on an original battery. The

vehicle experienced an estimated 13-percent capacity degradation which was translated to a

range reduction from 247 miles to 215 miles at 95-percent charge.

346

A Nissan Leaf was used to validate experimental test data for a 24 kWh lithium-manganese-

oxide (LMO)-graphite battery for a mid-sized electric vehicle study. The analysis showed that

calendar aging contributes more to capacity loss than cycle aging, with an average capacity

loss of 31-percent after 10 years, with the majority occurring in earlier years.

347

This was also

the case when two 2012 Nissan Leaf battery packs rated at 24 kWh were tested for charging

impacts on the battery. The packs completed 13 months of cycling which is about 50,000

miles and 780 cycles on a 7,088-second power-based drive cycle. This resulted in the battery

pack showing a capacity fade of 23.1-percent and the DCFC charged pack fading 28.1-

percent.

348

These results, however, represent earlier battery technology and, as a result of

the smaller size of the pack (and necessarily, short range of the vehicle), represent a more

demanding usage cycle of deeper discharge and charge events to meet a typical driver’s

daily needs. With manufacturers now putting forth vehicles with significantly higher battery

capacity and thus range, the depth of daily discharge and charge and consequent

degradation would be less.

An analysis conducted on Panasonic cells

349

revealed minimal capacity loss even at different

temperatures. Results revealed that at 10 degrees Celsius, there was 9-percent capacity fade

over 15 years and at 25 degrees Celsius there was 16-percent capacity fade over 15 years

(Keil et al. (2017)).

350

Certain regions in California experience these temperatures, such as

San Jose where the average low normal minimum temperature from 1991 to 2020 was 10

344

Tesla 2020. “2019 Tesla Impact Report”. https://www.tesla.com/ns_videos/2019-tesla-impact-report.pdf.

Released 2020. Accessed July 14, 2021.

345

Tesla 2021. “2020 Tesla Impact Report”. https://www.tesla.com/ns_videos/2020-tesla-impact-report.pdf.

Released 2021. Accessed January 31, 2022.

346

Inside EVs 2019. Tesloop Explains Various Causes For Tesla Battery Degradation. April 22. Accessed March

11, 2022. https://insideevs.com/news/345589/tesloop-reasons-cause-battery-degradation/.

347

Yang 2018. Yang et. al “Considering Battery Degradation in Life Cycle Greenhouse Gas Emission Analysis of

Electric Vehicles.” 25th CIRP Life Cycle Engineering (LCE) Conference 505-510.

doi:10.1016/j.procir.2017.12.008.

348

Tanim 2018. Tanim, Tanvir R., Matthew G. Shirk, Randy L. Bewley, Eric J. Dufek, and Bor Yann Liaw. 2018.

The implications of fast charge in lithium ion battery performance and life: cell vs. pack. Study, Energy Storage

and Advanced Vehicles Department, Idaho National Laboratory, Idaho Falls, Idaho: Idaho National Laboratory. 

349

Panasonic lithium ion cells: NCR18650PD with an NCA cathode and graphite anode

350

Kiel 2015. Keil, Peter, and Andreas Jossen. 2015. "Aging of Lithium-Ion Batteries in Electric Vehicles: Impact

of Regenerative Braking." World Electric Vehicle Journal 7.

degrees Celsius and in Burbank where the average high normal maximum temperature from

1991 to 2020 was 25 degrees Celsius.

351

The battery industry and researchers are working diligently to further increase battery

durability by addressing degradation mechanisms for not only conventional lithium-ion

batteries, but also for future batteries. Conventional lithium-ion battery cathode formulations

are moving to higher and higher nickel content for energy density which could affect

durability. Researchers are finding that doping those cathodes with aluminum helps to

improve cycle life.

352

Researchers have discovered methods to improve advanced lithium-

sulfur based batteries’ cycle life to levels that make them viable for light-duty automotive

applications.

353

Third party tests of pre-production solid-state cells from QuantumScape have

demonstrated their batteries are capable of over 800 cycles with 90-percent energy

retention.

354

These developments point to continued battery durability improvement in not

only conventional lithium-ion systems, but also for advanced battery chemistries.

Manufacturers are also touting further improvements in durability. In a 2021 interview with

Car and Driver, Tim Grewe of General Motors made claims that their Ultium battery

technology is expected to have no degradation from DC fast charging events and well

outlast Bolt EV batteries past 150,000 miles, and beyond the stated 100,000-mile warranty

period. This is due to battery chemistry improvements and the addition of aluminum into the

cell.

355

Toyota also announced its bZ4X, a BEV model soon available in the United States, is

expected to retain 90% of its range for nearly 150,000 miles, and maintain battery capacity

up to 70% for 10 years, exceeding staff’s proposed requirements.

356,357

While the first widely available FCEV was launched in 2015 and 2016, polymer electrolyte

membrane (PEM) fuel cell technology at the core of FCEVs has been under development for

several decades. In collaboration with automotive manufacturers, research scientists, and

others, the U.S. DOE has established goals for performance of PEM fuel cell systems used in

351

Current Results 2022. Average Annual Temperatures for Cities in California.

https://www.currentresults.com/Weather/California/average-annual-city-temperatures.php. Accessed March 11,

2022.

352

Zhuo et al 2021. Kai Zhou, Qiang Xie, Baohua Li, and Arumugam Manthiram. An in-depth understanding of

the effect of aluminum doping in high-nickel cathodes for lithium-ion batteries, Energy Storage Materials,

Volume 34, 2021, Pages 229-240,ISSN 2405-8297, https://doi.org/10.1016/j.ensm.2020.09.015

353

UMich 2022. University of Michigan. 1,000-cycle lithium-sulfur battery could quintuple electric vehicle ranges

https://news.umich.edu/1000-cycle-lithium-sulfur-battery-could-quintuple-electric-vehicle-ranges/ Posted

January 12, 2022. Accessed February 14, 2022.

354

Mobile Power Solutions 2021. “Q1-1695 Cell Cycle Life Test Report” Prepared by Mobile Power Solutions

for Quantum Scope. Spencer Poff. https://www.quantumscape.com/wp-content/uploads/2022/01/FINAL-

20211027-Q1-1695-Cell-Cycle-Life.pdf October 21, 2021. Accessed February 14, 2022.

355

Car and Driver 2021. Car and Driver. 2021. “How GM's Ultium Battery Will Help It Commit to an Electric

Future by Dave Vanderwerp.” Posted July 21, 2021. Accessed March 11, 2022.

https://www.caranddriver.com/features/a36877532/general-motors-ev-ultium-battery-electric-future/.

356

Toyota 2021. Toyota Europe Newsroom. “European premiere of the all-new Toyota bZ4X”

https://newsroom.toyota.eu/european-p

remiere-of-the-all-new-toyota-bz4x/ Posted December 2, 2021.

Accessed February 16, 2022.

357

Toyota 2021. Toyota United States Newsroom, “Revealed: The All-New, All-Electric Toyota bZ4X”

https://pressroom.toyota.com/revealed-the-all-new-all-electric-toyota-bz4x/ Posted November 17, 2021.

Accessed February 16, 2022

automobiles.

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Some performance targets have already been achieved or are nearly

achieved, including system power density and specific power (output electrical power per

unit volume and weight, respectively), cold start capability, and peak efficiency. The U.S.

DOE has set an ultimate target of 8,000 hours of operation with no more than 10-percent

degradation in system output.

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While this is determined under specific conditions in lab-

scale testing, the U.S. DOE has tracked progress in operating fleets of vehicles and reported

that maximum and average durability more than doubled between 2007 and 2015.

360

Unlike BEVs where battery capacity, and thus, driving range is the expected predominant

impact of degradation, the primary durability concern with FCEVs is degradation of the peak

power of the FCEV. Over time, the power generated by the fuel cell stack may degrade

resulting in a higher consumption of hydrogen fuel to drive the vehicle or a lower maximum

power available for propulsion. This impact is expected to first occur at peak powers which,

by design, would rarely be encountered in typical customer driving. However, there is still

more research to be done on FCEV durability as this technology matures.

In the meantime, staff is proposing that FCEVs meet equivalent driving-range based

durability requirements as BEVs to ensure that consumers will be able to rely on equivalent

minimum driving range capability throughout the useful life period. It is expected that FCEVs

will be able to meet this requirement without any changes to their current designs as today’s

FCEVs have not been reported as losing any appreciable range as they age. Further, much

like a fuel tank on today’s gasoline vehicles, high pressure hydrogen fuel tanks used to store

fuel onboard do not deteriorate or degrade such that they store less fuel over time. As noted

above, loss of peak power for the fuel cell itself can directionally increase fuel consumption

and thus, decrease range, but the impact at lower operating loads used during routine urban

driving on the durability test cycles is expected to be minimal. However, if such a loss of

power was severe enough for typical customers to notice, it likely would adversely affect

driving-range that is subject to the durability requirement. For the longer term, staff will

continue to work with manufacturers as FCEV technology matures to determine if a different

durability standard may be necessary for FCEV consumers.

a) Enforcement of Durability Standard

Gasoline manufacturers are required, via U.S. EPA and CARB requirements, to submit

laboratory data on a small subset of high mileage in-use vehicles within a test group, based

on total sales volumes. Indications of test groups that may be failing their emission standards

can trigger additional testing for the manufacturer to conduct. CARB also reviews this data

and can do its own additional testing. During this process, if test groups are found to be out

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DOE 2016. US Department of Energy. Hydrogen and Fuel Cell Technologies Office Multi-Year Research,

Development, and Demonstration Plan: Fuel Cells Section, 2016, US DOE Fuel Cells Plan Accessed February 11,

2022.

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US DOE also notes that this definition of useful life may not be applicable to the definition used by auto

manufacturers in the vehicles they make available for sale or lease. The end of useful life metric evaluated by US

DOE also does not imply the fuel cell is not usable beyond a 10% voltage degradation.

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NREL 2019. Kurtz, Jennifer, Sam Sprik, Genevieve Saur, and Shaun Onorato. 2019. Fuel Cell Electric Vehicle

Durability and Fuel Cell Performance. Golden, CO: National Renewable Energy Laboratory. NREL/TP-5400-

73011. NREL FCEV Durability Report.

of compliance with the emission standards within the defined durability time and miles, CARB

can require manufacturers to remedy the vehicles including recall if necessary.

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In developing a durability standard for ZEVs, staff modeled its enforcement of the standard

after its approach to gasoline vehicles while taking advantage of the capability of on vehicle

calculations in lieu of more costly laboratory testing.

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Staff’s proposed battery state of

health metric, discussed in section III.D.1, is a good proxy for vehicle range degradation, as

degradation of usable battery energy is the main factor expected to cause range

degradation. So, in lieu of actually procuring in-use vehicles and subjecting them to multi-day

laboratory testing to determine range, the battery state of health data could be procured

from a sample of vehicles and likely provide a good indication of the amount of original

range the vehicle is still capable of.

To that end, staff proposes that, at the time of certification, manufacturers submit data on

the expected degradation of battery state of health over the vehicle’s useful life to confirm

the test group has been designed to meet the durability requirement. Further, manufacturers

would be required to collect and submit battery state of health data from 30 vehicles per test

group at ages 3 and 6 years to provide information to CARB on the battery degradation.

CARB would retain the right to conduct official compliance testing on any test group by

procuring 10 representative in-use vehicles from the test group and carrying out the official

laboratory tests used at the time of certification to determine range and verify the durability

requirement was met. If five (50-percent) or more of the vehicles fail the durability test, the

manufacturer could be subject to corrective action for vehicles within the test group.

3. Warranty

Durability requirements have the effect of ensuring vehicles in a test group, in the aggregate,

are designed to have minimal degradation or deterioration such that they will meet or

exceed a performance standard over the useful life period. However, durability requirements

do not provide assurance that each and every individual vehicle will be free from defects or

other failures. The purpose of warranty requirements, on the other hand, is to provide

protection for consumers of individual vehicles that experience failures or defects early in the

life of the vehicle. A test group on track to meet the durability standard does not necessarily

mean that there will not be individual vehicles that experience failures or defects. Likewise,

individual vehicles experiencing a failure or defect does not necessarily mean that the test

group as a whole will fail to meet the durability standard.

Manufacturers are currently required to provide a minimum warranty on the emission control

systems for internal combustion engine vehicles, including PHEVs. Per Health and Safety

Code section 43205, manufacturers of light- and medium-duty vehicles must warrant their

vehicles and engines are (1) designed, built, and equipped to conform with applicable

emission standards, (2) are free from defects in materials and workmanship for 3 years or

50,000 miles, and (3) are free from defects in materials and workmanship in emission related

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In-use testing and verification procedures can be found in the "California 2015 and Subsequent Model

Criteria Pollutant Exhaust Emission Standards and Test Procedures and 2017 and Subsequent Model

Greenhouse Gas Exhaust Emission Standards and Test Procedures for Passenger Cars, Light-Duty Trucks, and

Medium-Duty Vehicles”. See also California Code of Regulations, tit. 13, §§ 1968.2, 1968.5.

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E.g., Health and Safety Code, §§ 38560, 39601, 39602.5, 43013, 43018, 43018.5, 43101, 43104, 43106.

parts which, at the time of certification by the state board, are estimated by the manufacturer

to cost individually more than three hundred dollars (for the 1990 model year and adjusted

by the consumer price index for subsequent model years) to replace, for a period of seven

years or 70,000 miles, whichever first occurs. Manufacturers are required to track warranty

rates (the rates at which vehicles under warranty are repaired) for individual emission controls

and progressively submit more information and analysis to CARB if warranty rates exceed

specific levels. Upon exceeding a verified warranty rate of 4-percent for a component, the

manufacturer can be subject to corrective actions to ensure vehicles in the test group will be

below the certified emission standard throughout the useful life.

The emission warranty provisions within the California Code of Regulations relating to

combustion vehicles reflect CARB’s long-standing use of its broad authority to adopt

regulations necessary to achieve healthful air quality and reach the State’s GHG reduction

targets.

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This broad authority works in tandem with statutory obligations of manufacturers

to warrant that their vehicles will meet the emission standards and other requirements

adopted by CARB.

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That authority supports warranty requirements in the zero-emission

context as well, as zero-emission vehicles must be durable with substantial warranties to

ensure they deliver their emissions reductions benefits. These benefits are critical: As

described earlier, the Mobile Source Strategy has confirmed California’s need to fully

transform the light-duty vehicle sector to ZEVs and PHEVs to have any chance of meeting the

State’s air quality and GHG targets. And for such a full transition to be successful, consumers

will need to have equivalent confidence in the performance and durability of ZEVs as they do

with the conventional gasoline vehicles they will need to displace. To help support this

confidence, the proposal includes minimum warranty requirements for key components

related to propulsion (the powertrain) of the vehicle to ensure adequate design specifications

are put in place by manufacturers. Staff’s warranty proposal is split into three parts: 1) battery

warranty, which would apply to BEVs and PHEVs, 2) propulsion-related parts warranty, which

would apply to BEVs and FCEVs, and 3) warranty reporting procedures.

a) Battery Warranty

The most expensive component for making a vehicle move on a BEV and PHEV is the battery

pack. Failure or undue degradation of the pack can affect the usefulness and drivability of a

BEV and cause individual drivers to stop using the vehicle, revert to gasoline vehicles, or

avoid initial or subsequent purchase of the technology for fear of future failure. Today,

manufacturers have been somewhat competitive in offering similar sounding battery

warranties for BEVs. In recent years, some manufacturers have even begun to define

warranties to a specified capacity loss within the warranty period. However, substantial

differences between manufacturers still exist as to what level of degradation, if any, is

warranted, how such a level will be determined, and to what extent the consumer is aware of

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E.g., Health & Saf. Code, §§ 39600, 39601, 43205. Legal 2014. Engine Manufacturers Association v. State

Air Resources Board (2014) 231 Cal.App.4th 1022. Accessed March 11, 2022.

https://www.leagle.com/decision/incaco20141124052; Deukmajian et al 1981. Deukmejian, George and

Anthony s. Da Vigo. 1981. “Legal Opinions of the Attorney General.” 64 Ops.Cal.Atty.Gen. 425. May 27,1981.

https://oag.ca.gov/system/files/opinions/pdfs/80-718.pdf.

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Health & Saf. Code, § 43205.

the details. Below is the summary of 2021 model year BEV warranties, and capacity

thresholds specified by manufacturers.

Table III-6: Summary of 2021 MY BEV and FCEV Warranties and Capacity Thresholds

Covered

Make/Model

BEV/FCEV

Drivetrain

Traction Battery

Capacity

Threshold

Audi e-tron 55 quattro

BEV

4/50K

8/100K

Not specified

BMW i3

BEV

4/50K

8/100K

Chevrolet Bolt EV

BEV

5/60K

8/100K

Ford Mustang Mach-E

BEV

8/100K

Fiat 500e

BEV

4/50K

8/100K

Capacity loss not

warranted

Hyundai Ioniq Electric

('17-18)

BEV

10/100K

lifetime/unlimited*

Capacity loss not

warranted

Hyundai Ioniq Electric

('19 +)

BEV

10/100K

Capacity loss not

warranted

Hyundai Kona Electric

('19)

BEV

10/100K

lifetime/unlimited*

Capacity loss not

warranted

Hyundai Kona Electric

('20)

BEV

10/100K

Capacity loss not

warranted

Jaguar I-Pace

BEV

5/60K

8/100K

Kia Niro Electric

BEV

10/100K

10/150K

Kia Soul EV

BEV

10/100K

Mini Cooper SE

BEV

4/50K

8/100K

Nissan LEAF

BEV

5/60K

8/100K

8 of 12 capacity

bars.

Polestar 2 (U.S.)

BEV

8/100K

Polestar 2 (CA, 177

States)

BEV

8/100K

10/150K

Porsche Taycan

BEV

4/50K

8/100K

Tesla Model 3/Y

Std/Mid-range

BEV

8/100K

Tesla Model 3/Y Long

range

BEV

8/120K

Tesla Model S/X pre-

'15 60 kWh

BEV

8/125K

Not specified

Tesla Model S/X '16-'20

BEV

8/unlimited

Not specified

Tesla Model S/X '21-

BEV

8/150K

Volkswagen e-Golf

BEV

5/60K

8/100K

Volkswagen ID4

BEV

4/50K

8/100K

Not yet available

Volvo XC40 Recharge

BEV

8/100K

Honda Clarity

FCEV

5/60K

N/A

Hyundai Nexo

FECV

10/100K

N/A

Toyota Mirai

FCEV

8/100K

N/A

*10/150K second

owner

As evidenced above, manufacturers are typically already offering warranties beyond what is

offered for gasoline vehicles with many at 10 years or 100,000 miles, or even more for both

powertrain components and batteries. While this may indicate that consumers are indeed

hesitant to embrace the newer technologies and manufacturers have needed to offer

extended warranty terms to bolster consumer confidence—the very reason staff noted above

as to why this proposal includes a minimum warranty—this also indicates that electrical or

electro-mechanical components that make up an electric vehicle powertrain are likely

inherently more durable than the conventional gasoline engines and components they are

displacing. Manufacturers can ill afford to risk substantial costs and consumer backlash from

high warranty rates on any vehicle model and ZEVs are no exception. This is evident even in

PHEVs, which are already subject to minimum emission warranties and warranty reporting,

where the incidence of reported warranty claims for electric drivetrain components is far less

than other conventional engine and transmission equipped vehicles.

Manufacturers are currently required to provide battery warranties on PHEVs for 10 years or

150,000 miles, in addition to the emission warranty which covers all of the conventional

engine and transmission powertrain components and electric drivetrain components,

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order for the vehicle to earn ZEV credit. However, while the lengthy warranty term sounds

protective, the regulation does not specify the level of degradation or failure that must be

warranted and manufacturers are not required to state the level of degradation or failure

eligible for warranty replacement of the battery. In practice, this has led to confusion and

frustration around PHEV battery warranties as some manufacturers have set criteria for

warranty replacement at a significant loss of electric range, others at a complete loss of

electric range, or others at a level even beyond complete loss of electric range and at a point

where the vehicle is unable to start or drive at all.

In order to make the warranty useful for vehicle owners, it must be tied to a meaningful and

transparent metric. Internal combustion engine vehicles today are equipped with complex

on-board diagnostic systems with check engine warning lights that provide a clear tell-tale to

the owner when a component failure has occurred at a specified level defined by CARB’s on-

board diagnostic requirements. Tying battery warranty to a meaningful metric is fundamental

to ensuring drivers are aware of early and unexpected battery degradation and can then

pursue the necessary repair.

To this end, staff proposes a minimum 8 years or 100,000 miles, whichever occurs first,

battery state of health warranty for any battery that falls below 70-percent for 2026 through

2030 model year for BEVs and PHEVs. Staff is proposing to increase the warrant trigger from

70-percent to 75-percent for 2031 and subsequent model year BEVs and PHEVs. For those

manufacturers that do explicitly already warrant for battery capacity loss, the vast majority

indicate 70-percent is the trigger point and every one of them uses a warranty term at or

exceeding the proposed 8 years and 100,000 miles. Staff expects that even those currently

offering such a warranty will continue to advance their battery durability (and vehicle control

systems to reduce degradation) in the years leading up to 2026 model year to be able to

easily meet this requirement even in the face of added transparency to the vehicle owner and

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On a PHEV, a failure of an electric drivetrain component, including the battery, leads to reduced electric

operation and a consequent increase in internal combustion gasoline engine operation which increases tailpipe

emissions and is thus, subject to the existing emission control warranty.

an anchoring to usable battery energy as opposed to an alternative parameter such as

capacity.

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For 2031 and subsequent model years, manufacturers would have more time to develop

successive battery technologies with this requirement in mind and make appropriate design

decisions to support it. In some cases, this may include choosing a materials or manufacturing

solution that sacrifices some cost reduction in order to improve durability. In talking with

manufacturers, however, it is clear that battery warranty concerns are not about the typical

customer, nominal battery durability, or random manufacturing defect. Rather, the concern is

atypical usage, by edge case users, that have a combination of usage behavior, charging

behavior, and parking behavior that stack up to a worst-case exposure and operational

conditions for the battery. Directionally, higher frequency of deeper discharge and charge

cycles, frequent rapid charging while the battery is at high temperature, and extended

operation at very low or very high state of charges and at very high ambient temperatures

can cause accelerated degradation of the battery. Yet much is still being learned by the

manufacturers on control mitigations they can implement to mitigate or avoid the impact of

these types of events. Most manufacturers have acknowledged they have resources

dedicated to studying clusters of vehicles experiencing greater than expected degradation

and identifying they problematic types of operation or combination of factors and

systematically attacking them through design and control strategies. Examples of such

actions include control strategies that discourage consumers from routinely fully charging the

battery except when the extra range is needed, systems that can turn on thermal

management while the car is parked if battery temperatures start to get too high, or

strategies that moderate fast charging rates or include anticipatory thermal management to

minimize high charge rates at high battery temperatures. With continued work in this area,

staff expects all manufacturers will narrow the gap between the degradation a median or

typical consumer may experience and that which an edge case user will experience which will

enable manufacturers to meet the 75-percent threshold on 2031 and subsequent model

years with the median behavior still very similar to today’s projected trajectory for

degradation.

b) Propulsion Related Parts Warranty

Non-battery propulsion-related components, such as the on-board charger, the electric

motors, inverters, and battery management system, are not expected to degrade like

batteries on BEVs. However, failure of such components can have detrimental effects on the

efficiency, performance, range, or drivability of the ZEV. Currently, as evidenced in Table

III-6, manufacturers are offering competitive warranties on electric powertrain-related

components.

Staff proposes that manufacturers provide a warranty for ZEVs, meaning BEVs and FCEVs,

consistent with what conventional gasoline vehicles are subject to, for a minimum of 3 years

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While usable battery energy and battery capacity are closely related, there is an important distinction.

Usable battery energy is derived from a specified laboratory driving test to quantify the amount of stored

energy that can be used to actually drive the vehicle. When the battery energy is insufficient to allow the

vehicle to follow the driving trace, the test is terminated. Capacity, however, is a measure of total energy in the

battery including energy that is insufficient to drive the vehicle but could still power small devices such as an

interior map light or heater fan.

or 50,000 miles (or 7 years, 70,000 miles for high-priced parts) for all propulsion-related

(powertrain) components, excluding the traction battery. Relative to today’s warranties, every

manufacturer currently offers a propulsion-related parts warranty longer than the proposed

3-year, 50,000-mile term. However, for the higher priced components, the industry appears

split with most of the more recently developed and released products offering a term that

exceeds the proposed 7-year, 70,000-mile term and most of the legacy earlier introduced

products offering a shorter term of 4 to 5 years and 50,000 to 60,000 miles. Setting aside

the proposed requirements, it is likely that the manufacturers with shorter terms will face

mounting competitive pressure to match the terms of their competitor’s offerings in newly

launched or redesigned products. Additionally, widespread presence of terms longer than

even the 7-year, 70,000-mile proposal suggests that manufacturers have carefully considered

their expected warranty failure rates and have confidence the durability and defect rate is far

less than is typical on conventional gasoline vehicles despite the long history of building

engines and components for gasoline engines. Also in line with minimum requirements for

internal combustion engine vehicles, manufacturers must include a standard warranty

statement, proposed within the regulatory text for section 1962.8, with every new ZEV

delivered for sale, explaining what their warranty covers.

c) Warranty Reporting

In 1988, CARB adopted the Emission Warranty Information Reporting regulations for tracking

emission control component defects affecting on-road vehicles. Warranty repairs, and the

frequency of them, can provide useful information about the in-use performance and

durability of the emission controls early in the life of the vehicle. The regulations require

manufacturers to monitor and review warranty claims for each component and submit

progressively more information and detailed analysis as the claim rate escalates. At a one-

percent warranty rate, initial reporting is required while a four-percent level triggers

additional analysis to screen the repairs to determine a true failure rate. Components with

warranty rates above four-percent after screening result in further evaluation and can subject

the manufacturer to corrective action.

Staff is proposing a similar reporting structure for battery and propulsion-related part

warranties on BEVs and FCEVs. Manufacturers would be required to monitor warranty claims

and begin reporting quarterly for individual components on test groups where the

cumulative number of unscreened warranty claims surpass one-percent (or 25 vehicles,

whichever is greater, to address low sales volume test groups where one-percent would

reflect too small of a sample). If the warranty claims for a specific component exceed four-

percent, the manufacturer would be required to do further reporting and analysis to

determine the root cause and actual failure rate (e.g., in cases where it can be determined

from analysis of the replaced parts that the component is properly functioning and was

mistakenly replaced). If after screening for the actual failure rate, the claims exceed a four-

percent level, additional analysis by the manufacturer and review by the Executive Officer is

triggered. Depending on the findings of the analysis and review, corrective action could be

required to address defects or design flaws that would not be adequately remedied in the

existing warranty process.

4. Service Information

ZEVs inherently have far fewer propulsion-related parts especially mechanical moving parts as

electric motors and power electronics dominate the electric drive propulsion system instead

of mechanical internal combustion engines and automatic transmissions comprised of

mechanical components like valves, springs, and gears. As a result, it is expected that

individual ZEVs will likely need fewer propulsion-related repairs than gasoline vehicles but the

sheer number of vehicles in California require a substantial repair network. According to the

latest census data, there are over 10,000 independent repair locations in California

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, as

compared to 1,300 new vehicle dealers

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to serve the needs of the nearly 25 million light-

duty vehicles currently in the California fleet. Recognizing the importance of the role of

independent repair shops, California has regulations to provide for access to repair

information and tooling necessary to carry out emission-related repairs.

In 2001, CARB adopted the Service Information regulation, requiring manufacturers to make

available all emission-related information to independent repair shops at a fair and

reasonable price. Additionally, the regulation requires manufacturers to offer the same

diagnostic tooling (used to communicate with the vehicle and access repair-relevant

information) that they sell to dealers to independent repair shops at a similar price.

Recognizing that there is also a role for aftermarket service information providers (who often

aggregate multiple manufacturer’s information into a common format and package for

technicians) and aftermarket tool manufacturers, the regulation also puts forth requirements

for manufacturers to work with such entities, commonly through licensing programs. Lastly,

the regulation establishes a standardized reprogramming requirement such that emission-

related onboard computers that are reprogrammable, are able to be reprogrammed using a

standardized interface meeting SAE J2534 specifications.

The U.S. EPA adopted similar requirements subsequent to CARB’s rules but in both cases,

the scope of the information and tooling was limited to that needed to carry out emission-

related repairs and did not address other components such as safety-related, air

conditioning, or infotainment systems. Taking this one step further, Massachusetts adopted

multiple rules, commonly known as “Right To Repair”, which required manufacturers to

similarly make available service information and tooling for all vehicle components. Faced

with different requirements for individual states, manufacturers entered into a voluntary

agreement to provide for access to all repair information nationwide.

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Additionally, as

originally written, the CARB and U.S. EPA regulations also do not subject ZEVs to the service

information rule.

To ensure ZEVs are viable transportation options that will displace emissions from

conventional vehicles, service information and tools must similarly be available to the

aftermarket repair industry. Vehicle owners have come to rely on the independent service

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Census 2022. United States Census Bureau. 2022. "81111: Automotive mechanical and electrical repair and

maintenance.” Accessed March 21, 2022. https://data.census.gov/cedsci/profile?g=0400000US06&n=81111.

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CNCDA 2022. California New Car Dealers Association “About Us” https://www.cncda.org/about/ Accessed

February 14, 2022.

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MOU 2014. Right to Repair Memorandum of Understanding. https://wanada.org/wp-

content/uploads/2021/01/R2R-MOU-and-Agreement-SIGNED.pdf Released January 15, 2014. Accessed

January 30, 2022.

providers who in turn rely on access to the training, information, and tooling necessary to

carry out the repairs. As of today, many (but not all) manufacturers already make information

and tooling available for their ZEVs, due in part to the aforementioned voluntary agreement

and the Massachusetts Right-To-Repair rule.

Staff is proposing to amend the existing regulation to require the same access and disclosure

of repair information and tooling for 2011 and subsection model year ZEVs as is required by

CCR, title 13, section 1969 for conventional light-duty vehicles. For ZEVs, the scope of the

required information will be for all propulsion-related parts to ensure that, at a minimum, a

vehicle can be repaired to make such that it can continue to be operated as a ZEV. As with

gasoline vehicles, manufacturers will also be required to comply with the same tooling

standardization requirements to be able to reprogram vehicle electronic control units, which

is further explained in Section III.D.1.

5. Battery Labeling

Staff’s proposal requires manufacturers of ZEVs, PHEVs, hybrid electric vehicles (HEV), and

48-Volt HEVs to include a label on the vehicle battery that provides key information about

the battery system. The label will include information on the battery chemistry, manufacturer,

voltage, and capacity. The physical label will also include a digital identifier used to connect

the label to a record in a digital repository of battery information. The digital repository will

include the information on the physical label (in case of damage to the physical label

rendering it illegible) as well as any hazardous materials or heavy metals, product safety or

recall information, and safe disposal information. The digital identifier will also put in place an

easy way for manufacturers to disclose (optionally or due to other existing or future

requirements) further information linked to the battery such as instructions for deactivation or

disassembly or additional safety or tracking information.

Having traction batteries appropriately labeled with information about their chemical and

physical makeup, manufacturer, and an identifier linking to a website with safety information

serves to boost consumer confidence in ZEVs and to support greater ZEV deployment,

ultimately helping secure the emissions reductions needed. With information about the

battery readily available, consumers can be assured that any ZEV servicer will have the

requisite information whenever needed to service, reuse, recycle, or dispose of the battery,

and will be properly informed for servicing. This will assure owners that the battery in their

vehicle will perform as intended and will not become a liability at the end of its useful life in a

vehicle, thus encouraging consumers to transition from conventional vehicles to BEVs and

displacing emissions as intended. Battery labeling can also support greater battery reuse and

recycling, helping to promote availability of battery materials, at lower cost and with reduced

need for obtaining raw materials, in the quantities needed to displace ICEVs.

The proposed labeling requirement builds on and draws from existing or proposed

international standards and guidelines, including SAE J2936, the proposed European

Directive, and Peoples Republic of China Restriction of Hazardous Substances (Table III-7), to

provide a uniform and consistent approach to promoting availability of requisite battery

information and responsible, safe, and efficient battery management.

Table III-7: Comparing this Policy Proposal to Existing and Proposed Standards

Requirement/ Standard

Staff’s

Proposal

SAE2936

Directive

PRC RoHS

Manufacturer

Chemistry

Voltage

Performance/capacity

Product Alert

Statements/Hazards

Composition/Process Related

Information

Electronic information

exchange/digital identifier

Staff’s proposal is also consistent with provisions of SAE J2984 “Chemical Identification of

Transportation Batteries for Recycling”. The majority of manufactures are already following,

either voluntarily or as a requirement, the aforementioned standards. Adopting provisions of

the SAE J2984 standard for new vehicles would impact the fewest regulated manufacturers,

further standardize charging across the market domestically and

internationally, minimize costs, and increase access to charging equipment – all of which

leads to greater deployment of ZEVs in place of conventional vehicles.

Lithium batteries, including those used in virtually every ZEV application, depend on a short

list of critical materials with unique properties and few substitutes. Because the supply of

these materials is crucial for their performance but may also be constrained or put at risk due

to natural, geopolitical, and economic forces, they are referred to as critical energy

materials.

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In 2018, the U.S. Department of Interior identified a range of lithium-ion battery

(LIB) materials as critical materials to the economic and national security of the United States,

including lithium, cobalt, manganese, and aluminum. Efficient use of these materials is key to

a sustainable future of ZEVs. The proposed standardized battery labeling requirements are

anticipated to support battery recycling and reuse, helping to reduce the need for additional

mining to supply critical energy materials for ZEV batteries in the amounts needed to

displace ICEVs.

Moreover, traction batteries are contained in many different types of vehicles, contain unique

chemistries and hazardous materials, and may present a liability to the State of California at

the end of life. Proper labeling thus assists with safe handling and disposal. Besides assuring

owners that ZEV batteries will function as intended and not become liabilities, the labeling

requirements will promote secondary uses and reduce disposal costs by providing reliable,

complete information about the physical characteristics of the batteries. This will reduce

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DOE 2011. United States Department of Energy. Critical materials strategy. December 2011.

https://www.energy.gov/sites/prod/files/DOE_CMS2011_FINAL_Full.pdf

lifecycle costs for ZEVs, assuring they are cost effective, and thus making it more likely they

will be cost-competitive with conventional vehicles and will reduce emissions as intended.

Electric vehicle batteries are retired from their primary application when the vehicle itself is

physically damaged (e.g., in a car accident), when the cost of needed repairs exceeds the

perceived value of the vehicle, when the battery itself is repaired or replaced due to a

malfunction, or when the range or performance is no longer acceptable to the driver and the

pack must be replaced. Retired battery systems are likely to enter a range of applications

based on their physical characteristics, state of health, and performance, or would be

recycled or disposed if no longer useable.

Some battery modules removed from vehicles with minimal degradation and, absent defects

or damage, will likely be refurbished and reused directly as a replacement battery pack for

the same model vehicle. Major automakers, including Nissan and Tesla, have offered rebuilt

or refurbished battery packs for service or warranty replacement of original battery packs in

BEVs.

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Manufacturers such as General Motors have taken steps to allow for repair or

replacement of just the portion of the battery pack containing the failure, rather than the

entire pack. This has been accomplished by breaking the pack into serviceable and

replaceable units.

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After use in a vehicle, lithium battery packs could deliver additional years of service in a

stationary application. Examples of stationary energy storage applications include backup

power for homes or cellular towers, or, in larger arrays, for large buildings like arenas

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utility grids. McKinsey reports that second-life batteries may be 30 to 70-percent less

expensive than new ones in energy storage applications in 2025. Second-life batteries would

also reduce the demand for newly mined materials used in the production of new energy

storage batteries.

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McKinsey also reports that, by 2030, the second-life battery supply from

the burgeoning BEV and PHEV market could exceed 200 gigawatt-hours per year, which

could exceed projected demand by nearly 25-percent.

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While uncertainty exists as to the extent that batteries will be put directly into a second use,

eventually the battery will need to be recycled or disposed. To ensure that used batteries can

be sustainably and properly managed at their end of life and critical battery materials are

recovered efficiently, information on the battery system needs to be provided to end users

and entities that receive, acquire, or hold batteries. This will help remove barriers to traction

battery reuse and recycling. Providing access to key battery information will facilitate safe

371

Green Car 2018. Evartas, Eric. Reports. “Nissan Begins Offering Rebuilt Leaf Battery Packs”

https://www.greencarreports.com/news/1116722_nissan-begins-offering-rebuilt-leaf-battery-packs. May 14,

2018. Accessed February 14, 2022.

372

GM 2020. GM Reveals New Ultium Batteries and a Flexible Global Platform to Rapidly Grow its EV Portfolio.

https://media.gm.com/media/us/en/gm/home.detail.html/content/Pages/news/us/en/2020/mar/0304-ev.html

Posted March 4, 2020. Accessed February 14, 2022.

373

Climate Action 2018. Wentworth, Adam. “Amsterdam Arena Installs Major New Battery Storage”

(https://www.climateaction.org/news/amsterdam-arena-installs-major-new-battery-storage)

374

Casals 2018. Lluc Canals Casals et al., Second life batteries lifespan: Rest of useful life and environmental

analysis, 2018, p. 7. https://www.sciencedirect.com/science/article/pii/S0301479718313124.

375

McKinsey 2019. McKinsey and Company. “Second-life EV batteries: The newest value pool in energy

storage” (https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/second-life-ev-batteries-

the-newest-value-pool-in-energy-storage#)

and economic collection, transportation, and concentration of materials for recovery.

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Efficient recovery of battery materials will also reduce demand on raw battery mineral mining

activities. Modeling shows that, under idealized conditions, material recovered from retired

batteries could meet over half of the U.S. demand for battery materials like cobalt, lithium,

manganese, and nickel by 2040.

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Recycling is the process of taking packs and reducing them to their base materials. The steps

for recycling LIBs can be broken down into three general stages:

• Pre-treatment, which primarily consists of mechanical shredding and sorting plastic,

metal-enriched liquid, and metal solids

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;

• Secondary treatment, which involves separating, with a chemical solvent, the cathode

from the aluminium collector foil; and

• Recovery of the cathode materials through either hydrometallurgy, which relies on

chemical leaching, or pyrometallurgy, which relies on high temperatures to enable

electrolytic reactions.

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Battery recycling is improving and will continue to improve overtime. Redwood Industries

was created to recover the most valuable materials from batteries with the intention of reuse.

In 2022, Panasonic announced it would be producing Tesla batteries with copper foil from

recovered material, the first closed-loop battery production process–in which batteries are

recycled, remanufactured and returned to the same factory. JB Straubel expects recycled

materials to be not just cost competitive but less expensive than newly mined materials.

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Consistent labeling of batteries could support more cost-effective end of life management

practices and profitable recycling. Recovery of valuable elements from recycling is

contributing to the expected decline in costs. Labeling is expected to facilitate recovery of

these elements, and by reducing costs may increase recovery of less valuable elements, such

as those in lithium iron phosphate batteries. Staff’s labeling proposal would enable more

efficient and economic sorting of end-of-life traction batteries and potentially avoid

inappropriate disposal pathways. Though not specific to this proposal, the cumulative cost

376

Zhang et al 2018b. Zhang, X., Li, L., Fan, E., Xue, Q., Bian, Y., Wu, F., & Chen, R. (2018). Toward sustainable

and systematic recycling of spent rechargeable batteries. Chemical Society Reviews, 47(19), 7239-7302.

377

Dunn 2021. Dunn 2021. Jessica Dunn, Margaret Slattery, Alissa Kendall, Hanjiro Ambrose, and Shuhan

Shen. “Circularity of Lithium-Ion Battery Materials in Electric Vehicles.” Environ. Sci. Technol. 2021, 55, 8, 5189–

5198. Published March 25, 2021. Accessed March 28, 2022.

https://pubs.acs.org/doi/abs/10.1021/acs.est.0c07030.

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Zhang et al 2018b.

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See Appendix G for more information on battery recycling processes.

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Forbes 2022. By Alan Ohnsman. “Panasonic To Make Tesla Battery Cells With Recycled Material From JB

Straubel’s Redwood.” Posted January 2, 2022. Accessed March 11, 2022.

https://www.forbes.com/sites/alanohnsman/2022/01/04/panasonic-to-make-tesla-battery-cells-with-recycled-

material-from-jb-straubels-redwood/?sh=762260956e82.

savings associated with improved recycling enabled by battery labeling has been estimated

to be more than $200 billion from 2026-2040, with $43 billion in savings in 2040 alone.

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6. Summary of ZEV Assurance Measure Proposals

In summary, staff is proposing a suite of ZEV assurance measures which include requirements

for durability, warranty, battery labeling, and serviceability. These measures individually and

collectively support the emission reductions of this regulation by ensuring that the vehicles

perform as needed to fully and permanently replace ICEVs. In addition to providing

consumer confidence and reliability so that ZEVs can fully penetrate both the new and used

vehicle markets, such requirements also have important distributional equity implications, as

they can assure the performance of vehicles bought used and when vehicles are more

affordable. Thus, the ZEV assurance measures can support access to reliable ZEVs in

communities that may not be buying new vehicles, but which do need reliable, durable, and

clean mobility options. Table III-8 summarizes these proposals below.

Table III-8: Summary of ZEV Assurance Proposals

Proposal Description Applicable Vehicles for

2026 MY, unless noted

Data Standardization

Required data parameters,

including battery state of

health

ZEVs and PHEVs*

Durability

80% of Certified Range

Value for 10 years / 150,000

miles

ZEVs and PHEVs*

Propulsion-Related Parts

Warranty

3 years / 50,000 miles

7 years / 70,000 miles for

high priced parts

ZEVs and PHEVs*

Battery Warranty

8 years / 100,000 miles, 70%

or 75% Battery State of

Health

ZEVs and PHEVs

Service Information

Disclose repair information

to independent repair shops

ZEVs (2011 MY+) and

PHEVs*

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UCLA 2019. Popper, Navarro, Lanfrankie, and Caro. “The (Potential) Value of Labelling in Lithium Ion Battery

Supply Chain.” UCLA Anderson Global Supply Chain Blog. https://blogs.anderson.ucla.edu/global-supply-

chain/2019/03/the-potential-value-of-labeling-in-the-lithium-ion-battery-supply-chain.html . Accessed on March

11, 2022

Battery Labeling

Label all traction batteries

for recyclability and

repurposing

ZEVs, PHEVs, HEVs, and 48V

HEVs

*PHEVs are proposed to be required to comply with staff’s battery state of health standardization and charge

rate requirements, both of which must be accessible to the driver. PHEV are already required to comply with (1)

CCR, Title 13, section 1968.2 (On-Board Diagnostics), which covers most other data metrics proposed for ZEVs,

(2) CCR, Title 13, sections 1961.2 and 1961.4 which requires vehicles to meet GHG and criteria exhaust emission

standards over useful life (15 years or 150,000 miles, (3) CCR, title 13, section 2037 ad 2038, which requires

emissions related parts warranty coverage for PHEVs, and (4) CCR, title 13, section 1969, which requires the

disclosure of service information.

IV. Summary of Staff’s LEV Proposals

The suite of proposed regulations guide the light-duty vehicle segment toward 100-percent

electrification by 2035, signifying that the last new conventional ICEVs will be sold in

California during the implementation period of this regulation. However, many of these

ICEVs will remain in-use on California’s roads well beyond 2035. As such, the proposed

regulation includes three primary elements aimed to mitigate the air quality impacts of

ICEVs. First, it would prevent potential emission backsliding of ICEVs that is otherwise

possible under the existing regulations by applying the exhaust and evaporative emission

fleet average standards exclusively to combustion engines. Second, it would lower the

maximum exhaust and evaporative emission rates. Third, it would reduce cold start emissions

by applying the emission standards to a broader range of in-use driving conditions. (Starts

after the vehicle engine has been shut-off for more than 12 hours are considered cold starts.)

The combination of these three elements would help deliver real world emission benefits

from the remaining ICEVs that would complement more significant emission reductions

gained by more widespread deployment of ZEV technology.

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For the medium-duty vehicle segment of ICEVs, the proposal would first provide better

emission control over a broader range of in-use driving conditions under the moving average

in-use standard for towing capable vehicles. Second, the proposal would require the fleet to

get cleaner by lowering the current fleet average standard. Third, the proposal would clean

up the highest emitting vehicles by lowering the maximum emission rate from medium-duty

vehicles.

The proposed regulations include conforming amendments to related regulations and

associated test procedures that are incorporated by reference into those regulations that are

necessary to maintain consistency with the new requirements proposed for model year 2026

and subsequent vehicles and maintain existing requirements in regulations that are not being

proposed for amendment. CARB is not proposing or considering any amendments to these

existing regulations for any other purpose.

Further details of the specific LEV criteria proposals are outlined below.

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Although not covered by the ZEV rulemaking in this regulatory package, the Advanced Clean Trucks

Regulation requires 50 percent electrification by 2035. (Title 13, CCR §1963)

A. Background

1. Certification Requirements for Light-Duty Vehicles

These proposals would be implemented in tandem with corresponding certification

requirements. For manufacturers to sell new light-duty vehicles in California, they must be

certified by CARB under an Executive Order. To get this certification, a gasoline or diesel

vehicle must demonstrate that its exhaust (also known as tailpipe) emissions and evaporative

emission control systems (as applicable, depending on the specific vehicle category) comply

with the emission standards for the vehicle's useful life, which is 15 years or 150,000

miles. The certification testing is carried out by the vehicle manufacturer, and the certification

vehicle typically represents a group of similar vehicle models. Vehicle models are categorized

into test groups for exhaust emission testing, and into evaporative families for evaporative

emission testing. Vehicles in the same test group share attributes such as similar engine size

and the number and arrangement of cylinders, while vehicles in the same evaporative family

share similar fuel tank size as well as common emission control components. As a reference

point, for the 2021 model year, one major manufacturer grouped its 47 vehicle models into

28 test groups and 14 evaporative families. This method of grouping vehicle models into test

groups and testing a representative vehicle streamlines certification.

Each test group must meet emission standards during different test cycles in a laboratory.

The emission test cycles include the Federal Test Procedure (FTP) cycle, which represents

urban driving and the Highway (HWY) cycle, which represents highway driving, as it is named.

Vehicles must also be tested on the US06 cycle, which represents aggressive driving, the

SC03 cycle which accounts for air conditioning use during warm conditions, and an FTP test

at 50 degrees Fahrenheit to represent cold weather driving. These cycles are meant to

ensure robust emission control under a broad variety of in-use operation.

2. Emission Bins and Fleet-Average Standards

Each vehicle that is delivered for sale in California must be certified to a specific

NMOG+NOx emission bin. Current light-duty vehicle regulations include six discrete

NMOG+NOx emission bins to which a vehicle can be certified, as shown in Table IV-1 below.

The certification bins indicate the maximum NMOG+NOx emissions that a vehicle may emit

when tested in a controlled lab environment on a chassis dynamometer using a specific test

cycle. The certification testing is conducted using a standardized test cycle, called the FTP

test, that is meant to represent normal urban driving.

Table IV-1: LEV III FTP Emission Certification Bins

Certification

Bin Name

NMOG+NOx

[grams per mile]

SULEV20 0.020

SULEV30 0.030

ULEV50 0.050

ULEV70 0.070

ULEV125 0.125

LEV160 0.160

In addition to each test group being certified to an individual emission standard bin, vehicle

manufacturers must also meet a fleet-average standard based on the model year with their

full fleet of vehicles. This is calculated by sales weighting of all test groups by the emission

bin value for the manufacturer.

3. Cold-Start Emissions

A cold-start occurs when a vehicle is started and all the vehicle components essential for

providing the force to move the vehicle and controlling emissions, such as the combustion

engine and aftertreatment catalyst, are near ambient air temperature. Cold starts are a

common occurrence in real-world driving. Parking a vehicle and leaving it overnight in a

garage or driveway will result in a cold-start when the vehicle is turned on in the morning. At

the end of a trip, the combustion engine is hot and the aftertreatment catalyst is warm, with

temperatures typically measuring several hundred degrees Fahrenheit. After the vehicle is

turned off at the end of a trip, both the engine and the catalyst are gradually cooled by the

ambient air, and eventually both will reach thermal equilibrium at the ambient air

temperature. The cooling down process is commonly referred to as a vehicle soak, since the

hot vehicle components are being soaked in the cooler air. Depending on the ambient air

temperature, the cool-down process will typically take several hours. For the purposes of

emission testing, a full vehicle soak is defined as 12 to 36 hours.

Generally, cold-start conditions will generate the highest emissions during a trip since all the

key emission control components are cold and the formation of engine out pollutants, or by-

products of combustion, are the highest. To help control cold start emissions, modern

vehicles are equipped with complex sensors and computer controls that can optimize

measurement and delivery of intake air, delivery of fuel, and spark timing to achieve early

complete combustion as fast as possible while also taking action to deliberately accelerate

warm-up of key emission controls such as the catalyst and the air fuel sensor(s) used to fine

tune fuel injection quantities. Today’s engine and emission controls, when operating

properly, are highly effective once operating temperature has been achieved under most

driving conditions. However, despite the advances in vehicle technology, the emissions

initially released during a cold start continue to represent the bulk of emissions released

during a trip, particularly for gasoline vehicles.

4. High-Powered Starts for PHEVs

Looking further into the criteria pollutant emission impacts of PHEVs, during the Midterm

Review, staff evaluated the cold start emissions of blended PHEVs representative of typical

PHEVs released during 2012-2016 model years. For blended PHEVs, both grid energy stored

in the battery and the internal combustion engine (ICE) can be used simultaneously to power

the vehicle. Generally, this occurs when the vehicle power demand is higher than what the

electric-only propulsion system can provide, and the vehicle must start the engine to

combine the electric and ICE power to meet the driver’s demand. In contrast, a non-blended

PHEV utilizes a larger electric motor and/or battery so the electric-only propulsion system can

fully meet any driver demands without the need to start the engine until the battery is fully

depleted. For both non-blended PHEVs and conventional vehicles, the engine is started

under more predictable and controllable conditions giving the manufacturer the ability to

optimize initial start-up operation to minimize emissions. Blended PHEVs, however, introduce

a unique driving condition where the initial engine start of a trip can occur at a time where

there is an immediate need for significant power and torque from the engine to help propel

the vehicle rather than providing an initial start-up window where emission control can be

prioritized. Such starts, referred to here as high-power cold starts, can have different

emission characteristics relative to the initial engine start of a conventional vehicle which

typically occurs with the vehicle stopped, in park or neutral, and with a very low immediate

torque demand. The Midterm Review testing confirmed that cold-start emissions can be

significantly higher under high power demand conditions relative to more traditional engine

start conditions.

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Staff conducted further testing and had discussions with the vehicle manufacturers to discuss

emission control strategies and alternatives that may provide for more robust emission

control in these conditions. Through these discussions and further testing, staff was directed

by the Board to propose standards to control criteria emission for future, 2026 and beyond

model year PHEVs.

5. PM Standards for Aggressive Driving Conditions

PM emissions from light- and medium-duty vehicles are regulated as part of the existing LEV

program. Under LEV III, the PM emission standard for passenger cars, light-duty trucks, and

medium-duty passenger vehicles was lowered from 10 mg/mi to 3 mg/mi between the 2017

and 2021 model years, then decreasing further to 1 mg/mi between the 2025 and 2028

model years. In the long term, the 1 mg/mi PM standard will be an effective backstop to

retain the progress in PM emission reductions achieved by today’s gasoline car fleet in

California and further reduce the health impacts associated with exposure to PM emissions.

However, testing conducted during the Midterm Review to evaluate manufacturer’s progress

in PM control also revealed that some vehicles that exhibit good control of PM emissions on

the FTP cycle have notably higher emissions on the US06 cycle, which is representative of

high speed and acceleration driving conditions. This was highlighted in testing done by

CARB and presented in Appendix J of the MTR. Under the LEV III regulations, the FTP PM

emission standard drops to 1 mg/mi in 2025, but the US06 standard remains at 6 mg/mi

indefinitely. Based on testing conducted by staff, the current standards could allow for

disproportionally higher PM emissions during more aggressive operation instead of

protecting for robust PM emission control under the broadest set of in-use driving

conditions.

6. Medium-Duty Vehicles

Medium-duty vehicles (MDVs) are a larger class of vehicles rated for a higher payload

capacity when compared to light-duty vehicles. The maximum payload capacity for a vehicle

is defined as its Gross Vehicle Weight Rating (GVWR). MDVs are separated into two different

classes depending on the vehicles’ GVWR and commonly referred to as “class 2b” which are

MDVs in the 8,501-10,000 lbs. GVWR and “class 3,” which are MDVs in the 10,001-14,000

lbs. GVWR.

Currently, there is flexibility in certification for class 3 MDVs as they can be certified as whole

vehicles using the light-duty chassis dynamometer test procedures or as a standalone engine

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CARB 2017i. California Air Resources Board. Appendix H: Plug-in Hybrid Electric Vehicle Emissions Testing.

Posted January 18, 2017. https://ww2.arb.ca.gov/sites/default/files/2020-01/appendix_h_phev_testing_ac.pdf

using the heavy-duty engine dynamometer test procedures. The engine certification process

outlined in 13 CCR 1956.8 (used in incomplete Otto-cycle medium-duty vehicles, or

incomplete and complete diesel medium-duty vehicles)

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is similar to the chassis-certification

process whereby engines, instead of complete vehicles, are tested on engine-specific test

cycles and must meet specific standards for those test cycles. One of the many differences

between the two certification paths is with the in-use compliance requirements. Chassis-

certified vehicles are readily able to be brought into a laboratory, by the manufacturer or

CARB, to perform official testing and confirm they meet the standards to which they were

certified. Engine-certified vehicles, on the other hand, need to have the engine removed

from the vehicle and tested in a specific laboratory designed to directly test engines to verify

compliance with the standards. This more complicated path led to the development of an

alternative method to verify in-use compliance for engine-certified products by using a

Portable Emission Measurement System (PEMS) that can be temporarily installed on a vehicle

and tested on-road without having to remove the engine and test it in a laboratory.

The recent heavy-duty Low NOx Omnibus rulemaking adopted amendments to the test

procedures and standards for both certification and in-use compliance for engines used in

heavy-duty applications as well as engines used in class 3 MDVs. These new amendments

included adding an additional engine-certification test cycle for diesel engines to cover the

low load engine operation range, which covers a similar area of engine operation as the

chassis-certification FTP test cycle. The amendments also established future engine FTP test

cycle standards that are much more stringent requiring both gasoline and diesels to meet a

0.02 g/bhp-hr NOx standard. This is a reduction of 80 to 90-percent from the current

standards. Additionally, the amendments made changes to the PEMS in-use standards and

test procedures for engine-certified vehicles to ensure all areas of engine operation are

covered during in-use testing and that the in-use emission threshold was reflective of the new

stringent certification standards.

7. Conforming amendments to related regulations

The proposed regulations include amendments to existing regulations to ensure internal

consistency and maintain existing requirements. These primarily consist of updates to cross-

references and definitions. The affected regulations in this category are the following

sections of Title 13 of the California Code of Regulations:

• 1900, Definitions

• 1961.2, Exhaust Emission Standards and Test Procedures - 2015 and Subsequent

Model Passenger Cars, Light-Duty Trucks, and Medium-Duty Vehicles

• 1961.3, Greenhouse Gas Exhaust Emission Standards and Test Procedures - 2017 and

Subsequent Model Passenger Cars, Light-Duty Trucks, and Medium-Duty Passenger

Vehicles.

• 1962.2, Zero-Emission Vehicle Standards for 2018 and Subsequent Model Year

Passenger Cars, Light-Duty Trucks, and Medium-Duty Vehicles.

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As of the 2020 MY, medium-duty engines for use in vehicles from 8,501 to 10,000 pounds GVWR must be

chassis certified (13 CCR 1961.2).

• 1965, Emission Control, Smog Index, and Environmental Performance Labels - 1979

and Subsequent Model-Year Motor Vehicles, to amend label requirements

• 1969, Motor Vehicle Service Information - 1994 and Subsequent Model Passenger

Cars, Light-Duty Trucks, and Medium-Duty Engines and Vehicles, and 2007 and

Subsequent Model Heavy-Duty Engines

• 1978, Standards and Test Procedures for Vehicle Refueling Emissions

• 2037, Defects Warranty Requirements for 1990 and Subsequent Model Passenger

Cars, Light-Duty Trucks, Medium-Duty Vehicles, and Motor Vehicle Engines Used in

Such Vehicles

• 2038, Performance Warranty Requirements for 1990 and Subsequent Model

Passenger Cars, Light-Duty Trucks, and Medium-Duty Vehicles, and Motor Vehicle

Engines Used in Such Vehicles.

• 2112, Definitions, for in-use vehicles and recalls

• 2139, Testing

• 2147, Demonstration of Compliance with Emission Standards

• 2317, Satisfaction of Designated Clean Fuel Requirements with a Substitute Fuel

• 2903, Definitions

The purpose and rationale for each specific amendment in this category is provided as part

of Appendix F-1, Purpose and Rationale for Proposed Changes to Title 13, CCR and

Incorporated Test Procedures.

B. Need for LEV Proposals

1. Need to Prevent Backsliding of ICEVs as ZEVs Significantly Increase

in the New Vehicle Fleet

Existing LEV III standards stipulate that each manufacturer’s light-duty vehicle fleet must

meet an NMOG+NOx fleet average standard that gradually reduces every model year until

reaching 0.030 grams per mile by the 2025 model year. Currently, the calculation of the fleet

average includes zero-emission vehicles (ZEVs). Since the fleet average remains constant at

0.030 grams per mile beyond 2025 and ZEV sales are expected to significantly increase,

there is a concern that manufacturers may utilize the higher fraction of ZEV sales to allow the

non-ZEVs to be certified to dirtier emission levels while still meeting the fleet average. Given

the need for continued criteria pollutant reductions in all sectors to meet the air quality

standards, it would be counter-productive to allow the remaining non-ZEVs to actually go

backwards and meet progressively less stringent standards than they do today or are on

track to meet by 2025.

Figure 8 illustrates the relationship between the percentage of ZEVs sold and the required

emissions from non-ZEVs to meet the NMOG+NOx fleet average of 0.030 grams per mile in

2025 and beyond. The figure illustrates that under the existing standards, average non-ZEV

emissions can get substantially higher as the number of ZEVs in the fleet increases. For

example, if the light-duty fleet includes 25-percent ZEVs in a given model year, then the 75-

percent of the fleet that is non-ZEVs can emit average emissions of 0.040 grams per mile and

still meet the 0.030 gram per mile fleet average. When ZEV sales reach 60-percent, then the

remaining 40-percent of the fleet that is non-ZEVs can emit up to 0.060 grams per mile.

Given this rulemaking proposal will require manufacturers to produce significantly higher

numbers of ZEVs, reaching 100-percent by 2035, the non-ZEVs have the theoretical potential

to revert all the way back to an emission level approaching 0.125 grams per mile or over four

times higher than the actual fleet average standard.

Figure 8: Potential Increase in Non-ZEV Emissions as More ZEVs Enter the Fleet

2. Need to Reduce High-Powered Cold-Start Emissions from PHEVs

PHEV high power cold starts represent another emission concern that is not captured by the

current cold start FTP test. To better understand the emission impacts of high power cold

starts, CARB staff tested various PHEVs to compare emissions between the current cold start

FTP test and various test cycles that would result in a high power cold start. For the purpose

of this testing, eight different high power test cycles were developed based on actual on-

road driving conditions that triggered a high power engine start for the test vehicles. These

test cycles include speeds and accelerations derived from on-road driving maneuvers like on-

ramp acceleration, merging into fast moving traffic, and passing another vehicle. The speed

traces of these cycles are shown in Appendix H.

Each PHEV was tested on these high power cycles along with the aggressive driving US06

cycle and the emission results were compared to the FTP test cycle. The results are illustrated

in Figure 9. The test data showed that high power starts generally increased emissions,

although some PHEVs performed better than others. For example, the Toyota Prius Prime

was able to complete most of the high power cycles without generating any emissions by

driving under electric power alone. This represents a real-world emission benefit since a

vehicle like the Prius Prime would be able to avoid many cold starts altogether. Another

vehicle that performed well was the Honda Clarity PHEV. Although the Clarity PHEV had

more frequent high-power starts than the Prius Prime, the Clarity generally had well-

controlled emissions during the high-power starts, which were not much different, on

average, than its FTP test emissions.

0.000

0.020

0.040

0.060

0.080

0.100

0.120

0.140

0 20 40 60 80 100

NMOG+NOx Emissions [g/mile]

Percentage of ZEVs in Light Duty Fleet [%]

Fleet Average Standard (Includes ZEVs)

Emissions of Non-ZEVs Required to Meet Fleet Average

Figure 9: Emission Results from FTP and High Power Cycles

On the other end, some of the worse performing PHEVs required the use of the combustion

engine on every high-power cycle and the emissions were not well controlled. For instance,

some of the heavier SUV PHEVs, like the Mitsubishi and Volvo models, had emissions that

were almost 10 times higher on some of the high power cycles compared to the FTP

certification test. These test results highlight the need to regulate PHEV high power cold

start emissions to prevent the substantial emission impacts that were observed on some of

the test vehicles.

3. Need to Address Cold-Start Emissions Under Real-World Driving

Conditions

CARB standards and test cycles are designed to account for cold-start emissions and ensure

good emission control. Before conducting an FTP emission certification test, the test

procedures require the vehicle to be parked, or ‘soaked’, overnight (for 12 to 36 hours). The

long vehicle soak ensures that the FTP emission test will begin under cold-start conditions,

which traditionally represents the worst-case emission levels. As technology has progressed

to meet progressively lower emission standards, manufacturers have implemented more and

more targeted strategies and components to directly reduce cold start emissions. However,

CARB testing found that a large portion of the vehicle fleet effectively had poor emission

calibration of these specific strategies and components outside the current test procedure

requirements.

Figure 10 shows vehicle test data that demonstrates partial cool-down soaks, in the range of

a vehicle being parked for 30 minutes to 3 hours, can result in even higher emissions than full

overnight soaks of 12 to 36 hours. Additional test data reported by CARB

385

in 2018 found

that the issue was widespread among the entire light-duty fleet rather than an issue with just

a few manufacturers. CARB’s discussions with manufacturers indicated that control of cold-

start emissions primarily focused on trips where the engine and emission controls had

completely cooled to ambient temperature, as typical of the 12 to 36 hour soak prescribed

385

CARB 2018b. California Air Resources Board, “EMFAC 2017 Volume III - Technical Documentation”.

Published July 20, 2018. https://ww3.arb.ca.gov/msei/downloads/emfac2017-volume-iii-technical-

documentation.pdf.

0.0

0.5

1.0

1.5

2.0

2.5

3.0

Ford Prius Prime Audi Honda Mitsubishi Volvo Chrysler Prius PHEV Hyundai

NMOG + NOx [grams]

FTP Test Cycle High Power Cycles

by certification test procedures, and that verifying equivalent robust control of partial soak

start emissions was generally overlooked during vehicle development.

Figure 10: Test Data with Various Soak Times

Additional analysis of in-use driving data collected during the California Household Travel

Survey

386

found that over 40-percent of trips occurred following a soak of 20 minutes to 5

hours as shown in Figure 11. As a relatively large share of trips falls into the partial soak

category, higher start emissions translate to a significant amount of cumulative emissions.

386

NREL 2022. National Renewable Energy Laboratory, “2010-2012 California Household Travel Survey”,

Accessed March 2, 2022, https://www.nrel.gov/transportation/secure-transportation-data/tsdc-california-travel-

survey.html

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1.0

0 100 200 300 400 500 600 700 800

NOx Emissions [g/start]

Vehicle Soak Time Prior to FTP Test [minutes]

2007 Volkswagen Jetta

2009 Toyota Camry

2007 Saturn Ion 2008 Honda Accord

12 hour

soak

Figure 11: Percentage of Starts with Various Soak Times.

A second issue related to cold-start emission regulations also stems from the current test

procedure requirements for the FTP cycle. Current test procedures stipulate that the FTP test

cycle begins by starting the vehicle and idling the engine for 20 seconds before the initial

acceleration event. And today’s vehicles take full advantage of this idling period as an

opportunity to prioritize engine operation to quickly heat up the catalyst thereby minimizing

emissions once the vehicle is driven. For example, most manufacturers utilize a strategy to

delay combustion in the cylinder such that the exhaust gases are a higher temperature when

they exit the cylinder and therefore can accelerate warm-up of the catalyst located in the

exhaust system. At idle, manufacturers are able to do this more aggressively than they could

if they were also trying to deliver power to accelerate the vehicle. Unfortunately, this 20

second idle before initial driving does not appear to be very representative of how vehicles

are being used.

CARB staff analyzed real world data to determine if a 20 second idle at the start of a trip, as

stipulated by the FTP certification test, was representative of real world driving. The real

world data revealed that the median idling duration preceding the initial acceleration was

less than 20 seconds as shown in Figure 11. Analysis of in-use data from over 47,000 trips

found that the median idle time was in the region of 14 seconds. Furthermore, over 20-

percent of trips had an idle of 5 seconds or less before the initial acceleration. Given that real

world trips generally had a shorter idle than the 20 seconds provided at the start of the FTP

test, CARB staff conducted testing to investigate the emission impacts of a shorter idle.

Figure 12: Percent of Trips by Idle Time

A summary of the test results is shown in Figure 12 and Figure 13 while further details are in

Appendix H. The data revealed that there was a substantial emission increase when the initial

idle was reduced from 20 seconds to 5 seconds at the start of the FTP test. Although every

vehicle that was tested exhibited increased emissions when the idle time was reduced, some

vehicles performed much better than others. Therefore, there is a need to establish a new

standard that will clean up the worse performing vehicles and reduce the variability of the

emission impacts between vehicles.

Figure 13: Effect of Short Idle on Emissions for SULEV30 Test Vehicles

100

0 10 20 30

Portion of Trips [%]

Initial Idle [s]

FTP Test

Median

14 sec

5 sec or less

24%

47,521 Total Trips

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0.08

0.10

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0.14

Altima 430i BMW X3 Camry 20 Dart Elantra Mazda3 Passat Sonata

Weighted NMOG+NOx [g/mile]

FTP with 20 s idle FTP with 5 s idle

SULEV30 Vehicles

100

Figure 14: Effect of Short Idle on Emissions for ULEV70 and ULEV125 Test Vehicles

4. Need for More Stringent PM Standards for Aggressive Driving Cycle

Testing in support of the Midterm Review revealed concerns regarding the robustness of PM

control under broader in-use driving conditions than the FTP represents. The test program

results confirmed that the current US06 standard may not ensure a sufficient level of emission

control. Further, high emissions during the US06 cycle may relate to higher near-roadway

emission levels and subsequent exposures, which can have a disproportionate impact on low

income and sensitive populations who may reside, work, or spend significant time near busy

roadways. Accordingly, staff recommended pursuing additional regulatory requirements to

better ensure that when the 1 mg/mi FTP standard is phased in, it results in robust in-use PM

control over a broader spectrum of driving conditions than encountered in the FTP. To this

end, the Board directed CARB to develop a more stringent US06 cycle PM emission

standard, which would verify PM is well controlled over more aggressive in-use driving

conditions, as well as consider PM emission standards for other test cycles and ambient

conditions as necessary to ensure in-use PM emissions are minimized. These actions will also

ensure that any future PM standards achieve meaningful and sustained in-use reductions.

5. Need for In-Use Standards for Medium-Duty Vehicles

Manufacturers have long had flexibility in certification methods for MDVs largely to

accommodate the resources of the manufacturer (e.g., primarily chassis-based testing

capacity or engine testing laboratories) and without regard to the intended buyer or

expected usage of the vehicle itself. As such, the two certification paths were not meant to

result in different stringencies of the applicable standards or robustness of the emission

control systems. However, over time, the differences between emission control

configurations have gotten larger, even in cases of trucks with similar capability that

otherwise differ only in the certification path chosen. This has led to significant differences in

real world emissions with each having areas where they perform better or worse than the

other despite being from vehicles with similar capability and similar usage patterns. The

recent heavy-duty Low NOx Omnibus rulemaking made amendments to the engine

0.00

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0.04

0.06

0.08

0.10

0.12

0.14

0.16

Explorer

Fusion

MB C300 Camry 17 Tahoe Wrangler

Weighted NMOG+NOx [g/mile]

FTP with 20 s idle FTP with 5 s idle

ULEV70 Vehicles

ULEV125 Vehicles

101

certification test procedures and standards that have made the engine certification path the

more stringent of the two certification options. Certification data has shown that a majority

of the new model year MDVs are already certifying using the chassis certification test

procedures and the number of engine certified MDVs has decreased from previous years.

Furthermore, the current certification process for chassis certification was meant to cover

engine speeds and torque ranges more common for light-duty applications. For heavy-duty,

the engine certification test cycles encompass much higher engine speeds and torque

ranges, which are more common for vehicles carrying heavier loads. MDVs are rated at a

higher GVWR than LDVs and consist mainly of pickup trucks and larger cargo or passenger

vans, with many having significant towing capability as well. In addition to a GVWR, the

maximum a vehicle can safely and legally weigh when it is fully loaded, vehicles also have a

gross combined weight rating (GCWR), which is the maximum allowable combined weight of

the fully loaded vehicle and the maximum trailer weight that can be towed. MDV pickup

trucks are often rated for a very high GCWR, usually between 20,000 to 30,000 lbs.

CARB conducted testing with a chassis certified MDV pickup truck in the lab and on an 80-

mile route in Southern California that consisted of freeway and city driving. Below in Figure

15 are test data from the lab and on-road PEMS testing, which shows the different areas of

engine operation that occur during the chassis certification test cycles and the on-road

testing. The x axis shows engine speed and the y axis shows torque on the lab test cycles

(FTP and US06) and in real-world driving with a PEMS unit on the Oxnard route with and

without towing. As seen from the graph, the lab test cycles do not represent all driving

conditions on the road, especially towing. CARB’s on-road test data with PEMS shows that

current chassis certification test cycles such as the FTP and US06 will cover only a portion of

the actual engine operation that typically occurs on-road.

Figure 15: Comparison of Engine Operation between Chassis-Certification FTP Test cycle

and On-road PEMS Testing

102

CARB’s on-road test data also shows that emissions during towing can be over four times

larger than emissions in the lab and during on-road driving. Figure 16 shows emissions from

on-road and lab testing for the same vehicle on the same route with and without towing.

Figure 16: PEMS On-road Data Comparing Towing and Non-Towing Emissions

The increase in emissions is not surprising since the area of engine operation that occurs

during towing is not tested on the chassis certification test cycles. Under the current

regulations, MDVs can be equipped with emission control systems optimized to handle

emissions during the low engine speed and load driving conditions that are covered by the

chassis-certification test cycles and have less robust control during higher load operation

such as towing without any consequence. As a result, many MDVs are using potentially

undersized emission control systems that cannot adequately control emissions during all

engine operations that occur on-road.

6. Need for More Stringent Standards for Medium-Duty Vehicles

To ensure manufacturers certify some test groups to more stringent FTP bin standards, they

are required to meet a declining FTP NMOG+NOx fleet average standard. To meet the fleet

average standard, the manufacturer’s emissions for their entire fleet must have average FTP

emissions below the fleet average standard for that model year. The LEV III MDV

NMOG+NOx fleet average standards started with model year 2016 and become more

stringent each subsequent model year until 2022. After model year 2022, the fleet average

standards would remain constant with class 2b and class 3 each having their own respective

standards.

Additionally, MDVs are subject to the Advanced Clean Trucks (ACT) regulation (California

Code of Regulations, title 13, § 1963) which will require that 50-percent of all MDV sales be

ZEVs by the 2035 model year. Even with this, CARB’s emission inventory of on-road sources

developed to meet planning obligations under the Clean Air Act, shows that although MDVs

are only about 3-percent of the light-duty population, they will account for 10-13-percent of

the NOx emissions from 2026 to 2050 as each individual vehicle emits at a significantly higher

103

level than light-duty vehicles. If the fleet average standards remain unchanged, then there

will be no further improvements to the ICE MDV fleet from the vehicles being certified and

built today even though further emission reductions are feasible.

7. Need to amend the OBD regulations

On-board diagnostic (OBD) systems are self-diagnostic systems incorporated into a vehicle’s

on-board computer. They are comprised mainly of software designed to detect emission-

control system malfunctions as they occur. This is done by monitoring virtually every

component and system that can cause increases in emissions, thus maintaining low emissions

throughout the vehicle’s life. The OBD system continuously works in the background during

vehicle operation to monitor emission-related components and alerts the vehicle operator of

detected malfunctions by illuminating the malfunction indicator light (MIL) on the vehicle’s

instrument panel. Additionally, the OBD system stores important information, including

identification of the faulty component or system and the nature of the fault, which allows for

quicker diagnosis and proper repair of the problem by technicians. This helps vehicle owners

experience less expensive repairs, and promotes repairs being done correctly the first time.

OBD systems also influence and interact with other CARB emission requirements. For

example, the detection of faults during the emission warranty period provides a clear

notification to the vehicle operator that a warranty repair is needed. In turn, this provides

further motivation to vehicle manufacturers to design durable emission controls to minimize

warranty costs and avoid perceptions by the vehicle operator of the need for frequent

repairs.

For the most critical emission control components that have the largest influence on tailpipe

emissions, the OBD system is required to monitor the components and indicate a fault code

when emissions exceed the emission standards by a certain amount. Emission “thresholds”

for these faults are typically a multiple of the exhaust emission standard (e.g., 2.0 times the

applicable standard).

Under the proposed amendments, new emission bins are being added between and below

the existing emission bins to provide manufacturers with additional flexibility in certifying

different vehicle models to specific bins such that their overall fleet meets the required fleet

average each year. Because the OBD emission thresholds are typically defined as a

multiplicative function of the emission bin that the vehicle is certified to and that the

multiplicative value varies between different emission bins, each emission bin is listed in the

OBD regulation along with the applicable multiplier. However, the newly added emission

bins are not in the existing OBD regulation so manufacturers would not know which

multiplier to even use with the new bins. Further, because some of the new bins are lower

than what was previously the lowest bin available, the appropriateness of which multiplier to

use has not yet been assessed. While detection of faults at proportionally lower levels will

likely be required in the future as it will be necessary to ensure the maximum benefits of the

proposed standards are maintained in-use, the vehicle manufacturers have expressed

concern about not knowing with certainty what impact the lower standards will have on their

OBD monitoring capability. As such, the vehicle manufacturers have requested interim relief

until they have more certainty on what emission thresholds are achievable, and CARB staff

concurs that the requested relief is reasonable and needed.

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C. LEV Proposals and Feasibility

1. Proposal: Fleet Average Standard without ZEVs

To prevent any potential emission backsliding from light-duty non-ZEVs due to expected

increases in future ZEV sales, staff is proposing to remove ZEVs from the NMOG+NOx fleet

average while maintaining a fleet average of 0.030 grams per mile beyond 2025. To facilitate

the transition, the proposal will include a 4-year phase-out of ZEVs as shown in Table IV-2.

The phase-out percentages in the chart represent the percentage of ZEVs sold that may

continue to be counted in the fleet average. For example, a manufacturer may continue to

include 60-percent of its ZEVs in its model year 2026 LEV IV fleet average calculation. If a

manufacturer were to sell 100,000 ZEVs in 2026, they would only be able to include 60,000 in

the fleet average calculation. In this manner, the phase-out will lead to a complete removal

of ZEVs from the fleet average in the 2029 model year. This proposal will ensure that non-

ZEVs will be required to meet a fleet average of 0.030 grams per mile in 2029 and beyond,

regardless of how many ZEVs are sold in a model year.

Table IV-2: Phase-out of ZEVs from the Fleet-average Standard

Model Year NMOG+NOx Fleet Average % of ZEVs Allowed

2025 and earlier 0.030 grams per mile 100

2026 0.030 grams per mile 60

2027 0.030 grams per mile 30

2028 0.030 grams per mile 15

2029 and beyond 0.030 grams per mile 0

To further help transition the light-duty fleet to an NMOG+NOx fleet average that does not

include ZEVs, staff is proposing changes to the existing NMOG+NOx certification bins. The

current LEV III standards provide six distinct certification bins that range from SULEV20

(0.020 grams per mile NMOG+NOx) to LEV160 (0.160 grams per mile NMOG+NOx). As the

fleet moves towards a 0.030 gram per mile fleet average, the need for the highest bins is

substantially reduced as virtually every vehicle would need to be certified to a bin fairly close

to the target fleet average. Furthermore, because additional emission reductions are

necessary and the lowest standards were demonstrated in the development of LEV III as

feasible for even the largest and heaviest light-duty vehicles, the need to retain bins that are

4 to 5 times higher than the fleet average is unnecessary. However, as manufacturers reduce

the number of non-ZEVs in their fleets, they will have fewer vehicles to average and there is

increased risk that a single model that misses its design target could result in a noncompliant

fleet average. To reduce this risk, staff is proposing the addition of several new bins, shown

in Figure 17, that will provide manufacturers more flexibility in achieving the fleet average.

These intermediate and lower bins will provide manufacturers the ability to certify vehicles

closer to the fleet average and more easily manage a diminishing number of products as they

transition to ZEVs.

105

Figure 17: Proposed Changes to Certification Bins for the Light-duty Fleet

Feasibility of NMOG+NOx Fleet Average Proposal Without ZEVs

The LEV III rulemaking assumed that all existing LEV and ULEV vehicles at that time would be

upgraded to SULEV30 vehicles, and these costs were accounted for in the previous LEV III

rulemaking. Further, these costs were made for a worst-case fleet assumption of virtually no

ZEVs in the fleet average calculation which is consistent with this proposal to remove ZEVs

from the fleet average calculation ensuring that the non-ZEVs as a whole, are held to that

0.030 g/mile fleet average. Accordingly, staff is not projecting the need for development or

deployment of any new technologies but rather the use of the exact technologies and rate of

deployment previously analyzed and determined to be feasible. Technologies relied upon in

the LEV III analysis included larger volume catalysts, greater catalyst precious metal loading,

more optimized close-coupled catalysts, optimized thermal management, low thermal mass

turbochargers, double layer catalyst washcoats, and improved fuel injection control and are

described in more detail in the original LEV III rulemaking package. These are the same

technologies that manufacturers have largely deployed to date and can still utilize to convert

current and future vehicles to SULEV30 to meet the original 0.030 g/mile fleet average.

As described earlier in Table IV-2, the phase-out of ZEVs from the NMOG+NOx fleet average

will take place over four model years. The phase-out was designed to give automakers

additional flexibility and enough lead time to ensure their future vehicle plans will be able to

meet the fleet average. Since the phase-out specifies a percentage of total ZEV sales that can

continue to be counted in the fleet average requirement rather than an absolute number of

sales, it will also reward automakers that have a higher fraction of ZEV sales during the

phase-out years as they will be able to count more ZEVs in their fleet average compliance

calculations.

2. Proposal: Stand-Alone Standards for Aggressive Driving

As discussed earlier, the FTP does not reflect emissions that can occur during more

aggressive driving, such as driving on freeways where vehicle speeds and accelerations can

be much higher than on urban streets. With this in mind, current CARB regulations also

require vehicles to meet aggressive driving emission standards using a test cycle, called the

US06 cycle, that exhibits higher speeds and accelerations than the urban driving test. In

addition, CARB also regulates emissions exhibited during urban driving in warm

temperatures of 90 to 100 degrees Fahrenheit while using the vehicle’s air conditioning

system. The test cycle that is used to determine the emissions under air conditioning use is

called the SC03 test cycle.

15 25

New Bins to Add

Existing Bins to Keep

NMOG+NOx

[mg per mile]

125 160

Existing Bins to Remove

106

The current rules provide two different options for automakers to certify aggressive driving

emissions as outlined in Table IV-3. The stand-alone option requires vehicles to meet

separate NMOG+NOx targets on the US06 and SC03 cycles. On the other hand, the

composite emission option allows vehicles to certify using a composite emission value that is

derived by averaging emissions from the US06 test with emissions from less aggressive FTP

and SC03 tests. The composite method assumes that the average vehicle will drive 35

percent of the time like the FTP cycle, 28 percent of the time like the US06 cycle, and 37

percent of the time like the SC03 cycle and weights the results of those different test cycles

accordingly. Currently, nearly all automakers have elected to certify using the composite

emission method. Despite choosing the composite certification option, a large majority of

the vehicles in the fleet have emission results that would meet the stand-alone requirements

for the US06 cycle.

Table IV-3: LEV III Emission Standards for Aggressive Driving in 2025 and Subsequent

Model Years

FTP

Certification

Bin

Option 1: Stand-Alone Standards

Option 2: Composite

US06 Cycle SC03 Cycle Fleet Average

NMOG+NOx

[g/mile]

NMOG+NOx

[g/mile]

NMOG+NOx

[g/mile]

LEV 0.140 9.6 0.100 3.2

0.050 4.2

ULEV 0.120 9.6 0.070 3.2

SULEV 0.050 9.6 0.020 3.2

Staff’s analysis of certification data found that the composite average method allowed for

poor emission control during aggressive driving for a small portion of the fleet. Certification

data shows there are 11 test groups, which represent about 3 percent of the fleet, that have

US06 emissions that are above the US06 stand-alone standard. While the composite option

was originally intended to give manufacturers flexibility in emission levels slightly higher or

lower than the cycle specific limits, the unintended consequence is that emissions during the

US06 can be significantly higher and offset by typically low emissions on the FTP and SC03

cycles. Besides being dirtier than is technically necessary for a vehicle with robust emission

control, if real world operation of such vehicles happens to include a higher fraction of

aggressive driving than the weighting in the composite standard, the resultant average in-use

emissions are higher than represented by the standard.

To ensure robust emission calibration during aggressive driving for all vehicles, the proposed

regulation will eliminate the composite average option for certification and will instead

require all vehicles to meet stand-alone US06 standards. To determine appropriate stand-

alone standards, staff conducted US06 emission tests with current vehicles. A summary of

the test results is illustrated in Figure 18. The test data indicates that most vehicles are

already able to meet a stand-alone US06 standard that is equal to the FTP standard even

when taking test-to-test variability into account.

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Figure 18: US06 Emission Test Data

Based on the test data, the proposed regulation will set a stand-alone US06 emission

standard that is equal to the FTP standard as shown in Table IV-4. An exception is proposed

for vehicles certifying below SULEV30 levels. Due to a lack of availability of vehicles currently

certified below 0.030 grams per mile, the US06 standard for all vehicles certified below 0.030

grams per mile on the FTP cycle is proposed to be 0.030 grams per mile.

Table IV-4: Proposed Stand-Alone Emission Standards for the US06 Cycle

FTP Emission

Certification Bin

FTP NMOG+NOx

[g/mile]

US06 NMOG+NOx

[g/mile]

SULEV15 0.015 0.030

SULEV20 0.020 0.030

SULEV25 0.025 0.030

SULEV30 0.030 0.030

ULEV40 0.040 0.040

ULEV50 0.050 0.050

ULEV60 0.060 0.060

ULEV70 0.070 0.070

ULEV125 0.125 0.125

Feasibility of NMOG+NOx emission control during aggressive driving proposal

Staff is proposing new stand-alone standards for the US06 cycle to ensure all vehicles will

have good emission control during aggressive driving. Existing vehicles were used to develop

the emission targets for the stand-alone US06 test. Based on the test results, the US06 stand-

alone standards were set at a value that the majority of test vehicles are already able to

achieve even before being designed specifically to meet. Therefore, staff expects that a

majority of current vehicles will be able to comply with the proposed US06 standards without

any modifications. Certification data from the 2021 model year revealed that only 7 percent

of vehicle test groups had US06 emissions that exceeded the proposed US06 standards,

indicating that the proposed standards are feasible.

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ULEV70

108

The main technology upgrade that will be needed to ensure these remaining vehicles will

meet the proposed standards is a catalyst system upgrade. Staff analysis of confidential data

provided by manufacturers at the time of certification revealed that vehicles already meeting

the proposed standards had, on average, a catalyst system that was more heavily loaded with

precious metals compared to the 7 percent of the fleet that is expected to need further work

to comply; directionally, this would be expected as all vehicles have already developed

catalyst systems that exhibit good control on the FTP cycle which is primarily driven by small

enough catalysts located close to the exhaust manifold to facilitate quick light-off for optimal

cold-start performance and additional catalyst volume downstream to handle higher exhaust

flows during the accelerations or higher speeds of the FTP. The US06 cycle, however, does

not have a cold-start or any engine start, and begins with a warmed-up system and then

includes a series of more aggressive accelerations and even higher speeds than the FTP. For

vehicles with insufficient downstream catalyst volume or precious metal loading, the higher

exhaust flows of the US06 may be just high enough to overwhelm the catalysts or provide

insufficient residence time for the exhaust gas in the catalyst to maximize the oxidation and

reduction reactions necessary to convert hydrocarbons and NOx. While such ‘breakthrough’

is theoretically possible on any vehicle if operated for a sustained time at maximum engine

load and speed, such operation in-use is extremely rare and the primary intent of the US06

cycle was to establish an upper bound of reasonably frequent occurring in-use operation and

ensure that emissions were well controlled at any point from the FTP up through the US06.

It should be noted that when the US06 was first developed for vehicles in the 2000 and

subsequent model years, engine and emission controls were not as sophisticated or capable

as they are on modern vehicles. At the time, it was much more difficult to precisely match

fueling to the transient air flows caused during high acceleration and there was less precision

in fuel control altogether. However, today’s vehicles have additional tools at their disposal to

better manage the air fuel ratio to minimize the formation of engine out emissions and avoid

any excessive rich or lean excursions that would reduce the conversion efficiency of the

catalyst. For example, electronic throttles allow the manufacturer to command throttle

opening and closing and the rate of such actions enabling them to more precisely match

fueling to the corresponding change in air flow. Variable valve timing on intake valves,

exhaust valves, or both gives manufacturers much more control in managing air flow into and

out of the cylinders to get good mixing to support complete combustion as well as to trap a

portion of the exhaust in cylinder to serve the same function as exhaust gas recirculation

systems previously did in minimizing engine out emissions. With improved fueling control

from wide range air fuel ratio sensors that can provide feedback not just as to whether the

mixture in the exhaust is rich or lean of stoichiometric operation but more precisely as to how

rich or how lean, manufacturers can operate the entire cycle at stoichiometry thereby

minimizing the formation of engine out emissions that the catalyst system would need to

reduce.

Further, staff did not observe any other trends in the limited number of vehicles that have

higher emissions than the proposed standard that would suggest any specific vehicle class or

powertrain technology would have inherent difficulty in meeting the standard. Rather, the

vast majority that already do comply represent the full spectrum of vehicle classes and

technologies available in the light-duty fleet.

To further help with the transition from a composite emission standard to a stand-alone US06

standard, the proposal will include interim standards and a phase-in. The interim standards

are 20 percent higher than the proposed standards and are allowed for 2026 and 2027

109

model year vehicles to provide manufacturers with extra margin for compliance in the first

few years. The proposed phase-in provides additional flexibility by giving manufacturers

three model years to progressively certify an increasing fraction of their fleet to these new

stand-alone standards. This added lead time allows manufacturers to implement design and

verification steps at regularly scheduled redesign or refresh intervals for the vast majority of

vehicles, thereby reducing the need for a unique calibration effort or added testing in years

where the vehicle largely would have been carried over from the previous year.

3. Proposal: PM Standard for Aggressive Driving

In addition to controlling NMOG+NOx and carbon monoxide (CO) emissions from light-duty

vehicles, CARB also regulates particulate matter (PM) emissions. Current regulations require

that all light-duty vehicles meet a PM standard of 6 mg/mile for the aggressive driving US06

cycle. Staff is proposing to reduce the US06 PM standard from 6 mg/mile to 3 mg/mile to

ensure robust PM emission control for all vehicles during high speeds and accelerations.

Staff is also proposing a four-year phase-in to transition from a 6 mg/mile to a 3 mg/mile PM

standard as shown in Table IV-5.

Table IV-5: Phase-in for the US06 PM Standard

Model Year 2026 2027 2028 2029

2030 &

Subsequent

% of Vehicles Certifying

at 3 mg/mile

0 25 50 75 100

% of Vehicles Certifying

at 6 mg/mile

100 75 50 25 0

Feasibility of particulate matter emission standard

Certification data shows that over 85 percent of current vehicles already emit below 3

mg/mile on the US06 cycle as shown in Figure 19, confirming the feasibility of meeting the

proposed standard. Additionally, manufacturers have not yet begun to certify vehicles to the

more rigorous 1 mg/mile FTP standard that phases in starting with the 2025 model year. As

noted earlier, test data have typically (but not always) shown that lower FTP PM emissions

does lead to lower US06 PM emissions. As such, the number of vehicles that would emit

below 3 mg/mi on the US06 would be expected to increase as the manufacturers certify to

the 1 mg/mile FTP standard, and the margin by which the are below the 3 mg/mi US06

standard would also be expected to increase. However, not all vehicles would end up below

the proposed standard and further development may be needed to ensure a vehicle will have

sufficient headroom below the standard to comfortably certify given test-to-test and vehicle-

to-vehicle variations that can occur on the US06. Analysis of certification data indicates that

approximately 76 percent of the 2020 model year fleet had US06 emissions of 2 mg/mile or

less. Therefore, about three quarters of new vehicles are expected to meet the proposed

US06 PM standards with minimal or no further vehicle or emission control development.

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Figure 19: 2020MY certification data for test groups meeting the US06 PM Standard

On the other hand, about one quarter of the fleet will need to improve PM emission control

on the US06 cycle to meet the proposed 3 mg/mile standard. Staff expects that improved

PM control on the US06 cycle can be achieved for most vehicles when they are redesigned to

meet the more stringent 1 mg/mile PM standard for the FTP cycle, which is already required

by current LEV III regulations. Much of the same technologies that are applied to vehicles to

meet the 1 mg/mile PM standard will also help vehicles to meet the proposed 3 mg/mile

US06 standard. These technologies were discussed extensively in the LEV III rulemaking and

include improved fuel injection hardware, better fuel injection control, and in some limited

cases, the use of particulate filters. Implementing a 3 mg/mile US06 standard will ensure

manufacturers will consider US06 PM emission targets as they develop the emission control

solution for vehicles to meet the 1 mg/mile FTP PM standard. Taking action to tighten the

US06 PM standard provides assurance that all vehicles will utilize hardware and software

solutions to achieve low PM emissions under broad driving conditions and not overly focus

on a solution that primarily works under FTP conditions.

To provide suitable lead time to manufacturers to implement solutions that will meet the

proposed US06 PM standard, the proposal will include a phase-in as shown in Table IV-5.

The proposed phase-in was purposely staggered to start and finish two years after the 1

mg/mi FTP standard since development has already started for some vehicles for the 1

mg/mile FTP standard. Therefore, even if a manufacturer discovered an issue late in the

design process, the delayed phase-in for the US06 PM standard would be expected to

provide sufficient time to update the emission control system at a normally scheduled vehicle

refresh and still meet the phase-in requirements. In addition, staff is proposing an interim in-

use standard of 4 mg/mile for 2027 to 2029 model year vehicles. While this still requires a

manufacturer to develop and certify to the 3 mg/mi standard, a higher interim in-use

standard provides additional relief from enforcement jeopardy should any unforeseen issues

occur in the early model years and cause in-use emissions to be slightly higher than

expected.

4. Proposal: Cold-Start Emission Control

The proposal includes new requirements that will better ensure good emission calibration for

all soaks and lead to real world emission benefits. Vehicle tests were conducted to determine

<2 mg/mile

76%

2-3 mg/mile

10%

>3 mg/mile

14%

111

an appropriate emission target for different soak durations. Current vehicles that had good

emission control for all soaks were selected for the testing since some automakers have

already taken voluntary action in recent model years to improve emission control for all

soaks. The test results are shown in Figure 20. Given that specific vehicle models that were

known to have already implemented some improvements were targeted for testing, it was

not unexpected for the test data to confirm that all of the test vehicles had lower partial soak

emissions than the earlier model year LEV2 SULEVs, as shown by the dashed line in

Figure 20 that were originally tested prior to voluntary actions by automakers. However,

some of the test vehicles performed substantially better than others indicating significant

differences in the implementation of improvements.

Figure 20: FTP Test Emissions for Different Vehicle Soak Durations

The proposed ACC II regulation will establish a continuum for the emission standards to

cover the full range of partial soaks of 10 minutes to 12 hours. First, the standards will newly

require all vehicles to meet the existing FTP emission standard for any soak longer than 3

hours instead of only for soaks longer than 12 hours to ensure consistency in cold start

emission control throughout that range. For example, a vehicle certified to the SULEV30

standard will be required to also meet 0.030 grams per mile NMOG+NOx for any soak of 3

to 12 hours and not just for soaks of 12 to 36 hours. A constant value standard was chosen

for these 3-to-12-hour soaks since the combustion engine and catalyst will have cooled down

significantly and the vehicle start conditions will resemble a cold start with a full soak of 12 to

36 hours. As shown in Figure 20, the test vehicles exhibited relatively flat emission profiles for

soaks of 3 to 12 hours.

For shorter soaks, in the region of 10 minutes to 3 hours, staff is proposing that vehicles will

have to exhibit emission levels consistent with the initial state of a partially warmed up

catalyst and engine as demonstrated by the best performing test vehicles. Any vehicle test

with a soak in the range of 10 minutes to 3 hours will have to exhibit FTP emissions below the

levels indicated in Table IV-6, and below any linearly interpolated value in between the chart

values. The tighter emission standards for 10-to-40 minute soaks, compared to 40-minute to

3-hour soaks, reflect the fact that the catalyst is still relatively warm for 10-to-40 minute soaks

0.01

0.02

0.03

0.04

0.05

0 30 60 90 120 150 180 210 240 270 300 330

NMOG+NOx [g/mile]

Soak Duration [minutes]

LEV2 SULEV Camry BMW Passat Sonata ACC II

720

112

and substantial emission benefits can be achieved by taking advantage of the warmer initial

catalyst temperature.

Table IV-6: Proposed Standards for Partial Soak FTP Test Emissions

Vehicle Emission

Category

NMOG+NOx Emission Standard [g/mile]

10-minute soak 40-minute soak 3-hour soak

ULEV125 0.063 0.096 0.125

ULEV70 0.035 0.054 0.070

ULEV60 0.030 0.046 0.060

ULEV50 0.025 0.038 0.050

ULEV40 0.020 0.031 0.040

SULEV30 0.015 0.023 0.030

SULEV25 0.013 0.019 0.025

SULEV20 0.010 0.015 0.020

SULEV15 0.008 0.012 0.015

To alleviate the certification test burden on manufacturers, this proposal will not change the

certification test requirements. Instead of certification testing, this proposal will require

manufacturers to attest at time of certification that the vehicles will meet these partial soak

standards. However, in-use and compliance testing may be performed at any soak duration

to verify a manufacturer’s attestation. Furthermore, manufacturers will continue to be

required to conduct certification testing to demonstrate compliance with the full soak (12-36

hour) cold start FTP standards.

Staff will also propose new standards that will help control cold start emissions for shorter

idles/quick drive-aways at the start of a trip. The proposed emission standards are based on

the best performing vehicles tested by CARB. The test data previously shown in Figure 13

indicated that the average emissions of SULEV30 vehicles were 0.042 g/mile when tested on

an FTP cycle with an initial idle of 5 seconds. Furthermore, the data shown previously in

Figure 14 revealed that ULEV70 test vehicles had average emissions of 0.082 g/mile and the

ULEV125 vehicles had average emissions of 0.100 g/mile when the FTP idle was reduced to 5

seconds. Based on this data, staff’s proposal will set emission targets for a new quick drive-

away FTP test as shown in Table IV-7.

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Table IV-7: Proposed Emission Standards for Quick Drive-Away FTP Test

Vehicle Emission

Category

Quick Drive-Away FTP

NMOG+NOx [g/mile]

ULEV125 0.125

ULEV70 0.082

ULEV60 0.072

ULEV50 0.062

ULEV40 0.052

SULEV30 0.042

SULEV25 0.037

SULEV20 0.032

SULEV15 0.027

Staff’s proposal will require emission compliance for the quick drive-away standards to be

demonstrated on an FTP test that has a reduced initial idle of 8 seconds. Compliance with

the proposed quick drive-away FTP test will be required in addition to the existing FTP cold-

start test that has a 20 second idle. An idle time of 8 seconds was chosen for the proposed

quick drive-away FTP test since real world data, shown previously in Figure 12, indicated that

about two-thirds of in-use trips had an initial idle of 8 seconds or longer. Furthermore, CARB

staff reviewed proprietary data

387

shared by stakeholders that corroborated CARB’s data

discussed above, showing a similar trend with the 25

percentile around 8 seconds, meaning

that 75-percent of real-world trips had an initial idle of 8 seconds or longer. Therefore,

setting the initial idle of the quick drive-away FTP test at 8 seconds will provide cold start

emission protection for most in-use trips.

Feasibility of the partial soak emission proposal

To address the emissions discussed above, staff is proposing new regulations that will control

cold-start emissions for all soaks. Current regulations already include standards for full soaks

of 12 to 36 hours and for 10-minute soaks as these are part of the current FTP cold start

certification test. This proposal will introduce new emission standards for partial soaks of 10

minutes to 12 hours. The required emission standard for partial soaks of 3 to 12 hours will be

equivalent to the emission standard for soaks of 12 to 36 hours. Since 3-to-12-hour soaks will

have similar or slightly more favorable (slightly warmer) initial conditions of the combustion

engine and catalyst, the emission control strategies will also be the same. Therefore, to

achieve the proposed emission standards for 3-to-12-hour soaks, vehicles can apply the same

emission control strategies as currently used for 12 to 36 hours soaks. In fact, the primary

purpose of this proposal is to ensure that those same strategies are activated for 3-to-12-

hour soaks instead of some earlier calibrations that artificially limited activation of these

strategies only to longer soaks.

Conversely, the proposed emission standard for 10 minute to 3 hour soaks is lower than the

emission standard for 12-36 hour soaks. As the combustion engine and catalyst are

substantially warmer for a vehicle restart after a soak of only 10 minutes to 3 hours, the initial

start conditions are more favorable for controlling emissions, and tests with current vehicles

have demonstrated that the proposed emission standards can be achieved. For example, a

full cold start may typically begin with the catalyst at an ambient temperature of 75 degrees

387

Because the data is proprietary, it is not included in the rulemaking record and is not being relied upon for

the proposed regulation.

114

Fahrenheit and quickly warm the catalyst up to an operating temperature of 600 to 800

degrees within the first 20 to 30 seconds of the test. On a subsequent restart after a short

soak of 10 or 20 minutes, the catalyst is still above 500 to 600 degrees allowing for high

conversion efficiency immediately after start. Even on slightly longer soaks of 30 minutes to 1

hour, the catalyst will still have a substantial head start in getting up to operating

temperature resulting in lower emissions sooner after engine start. The temperature inside

the combustion chamber can have similar effects providing for improved complete

combustion of the injected fuel earlier thereby minimizing the formation of engine out

pollutants.

Even though the conditions on a restart after a shorter soak are more favorable to early

emission control, they are still different than the initial conditions for a full soak of 12 to 36

hours. As a result, some vehicles are expected to need to re-optimize the emission control

strategy for these warmer start conditions to achieve the proposed standards rather than

simply just making sure it is turned on for the warmer starts. Some strategies that may need

to be re-optimized include engine idle speed, spark ignition timing, fuel injection control,

and variable valve timing. For example, manufacturers often delay spark timing to initiate

combustion later thereby causing the exhaust gases to be hotter when expelled from the

combustion chamber to aid in catalyst warm-up. However, such spark delay can decrease the

stability of combustion in the engine and is dependent on the load of the engine. A warmer

engine generally has lower friction and thus, there is a lower load to overcome when idling,

which in turn, reduces the amount of delayed spark it can tolerate and maintain stable

combustion. Accordingly, a manufacturer may need to recalibrate the amount of spark delay

in combination with idle speed and load targets on a warm re-start rather than simply apply

the same calibration as used on a cold start of 12 to 36 hours.

In addition, the emission control software may need to be redesigned to properly recognize

partial soak start conditions and trigger appropriate control strategy actions. For instance, a

current strategy may not be designed to utilize the estimated catalyst temperature at start-

up to decide whether to invoke a specific strategy even though such a parameter already

exists in the onboard computer and is used for other purposes. In general, most of this can

be accomplished through software and vehicle calibrations rather than new hardware as

evidenced by the improvements observed in CARBs testing data. To facilitate integration of

the necessary calibration and development work with regularly scheduled redesign or refresh

cycles of typical vehicles, the proposal will include a 3-year phase-in as outlined in Table IV-8.

Table IV-8: Proposed Phase-In for Partial Soak Standards

Model Year

% of Vehicles Certified to

Partial Soak Standards

2026 30

2027 60

2028 and subsequent 100

Feasibility of the quick drive-away emission control proposal

Staff’s proposal also includes new emission standards for a quick drive-away FTP test that will

help reduce real world emissions when a vehicle starts its first acceleration before 20 seconds

of engine idle. The proposed emission standards are based on the average emissions

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exhibited by various test vehicles on an FTP test with a 5 second initial idle. As shown

previously in Figure 13 and Figure 14, the test data show that 10 out of 15 test vehicles met

the proposed emission standards in Table IV-7. This result implies that the majority of

current vehicles should be able to meet the proposed standards with minimal or no

modifications to their emission control system. It should be noted that the vehicles were

tested under more worst-case conditions than the proposed standard, with a drive-away after

just 5 seconds of idle instead of 8 seconds. The additional 3 seconds of idle at the start of

the certification test will allow additional catalyst heating that will directionally result in lower

emissions for all of the test vehicles. However, as the test data showed, there were several

vehicles that did exceed the proposed standards and some of these vehicles will need

additional development work to improve the emission control strategy for quick drive-aways.

Based on discussions with manufacturers and suppliers and the results of CARB’s testing,

staff expects that most vehicles will be able to achieve compliance by improving the cold-

start emission control strategy via software and calibration changes rather than requiring new

hardware. Under the current 20-second idle test, manufacturers can readily prioritize actions

to warm-up the catalyst over actions that reduce engine out emissions as the mass of

emissions during idle is relatively low and the catalyst can reach a temperature at which it is

highly effective before the first acceleration that introduces a significantly higher mass of

emissions into the exhaust. However, under a shorter idle period, catalyst heating is

insufficient to reach a high conversion efficiency before the first acceleration. Consequently,

more emphasis needs to be placed on minimizing the formation of engine out emissions not

just at idle but during that initial drive-off. This can include actions related to air flow

management and fuel injection strategies to ensure complete combustion of the injected fuel

with good mixing, complete atomization, and localized conditions at the spark plug to ensure

a good combustion event.

CARB’s test data indicated that the major difference between the 10 low emitting vehicles

that complied with the proposed standards and the 5 high emitting vehicles were

hydrocarbon emissions rather than NOx, as shown in Figure 21. This data suggests that the

higher emitting vehicles will likely need to focus on strategies to reduce hydrocarbon

emissions. This can include improvements in the fuel injection strategy, such as multiple

injections to allow for an initial localized rich condition at the spark plug to initiate

combustion followed by a second injection, better control of fuel injection quantity and air-

to-fuel ratio to achieve a homogeneous mixture for complete combustion and avoid injected

fuel impinging on the cylinder walls to create excess hydrocarbons or particulate matter, and

adjustments to the spark timing. Furthermore, even while driving away, manufacturers can

continue to take action to accelerate catalyst warm-up such as calibrating the system with a

torque reserve and delaying spark timing to effectively run the engine less efficiently and

create excess heat late in the combustion cycle that translates to hotter exhaust gases to

accelerate catalyst warm-up. Several manufacturers already have such a strategy in place and,

while it has a smaller impact during driving than it does at idle, it still directionally results in

getting the catalyst to a point of high conversion efficiency earlier than it otherwise would.

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Figure 21: Comparison of NOx and Hydrocarbon Emissions for Quick Drive-Away Tests

In some limited cases, staff expects that a manufacturer may need to resort to hardware

changes such as a higher-pressure fuel injection system or more capable fuel injector to

achieve further reduction of engine out emissions or better balance initial catalyst light-off

with sufficient control during an early drive-away. However, to the extent that such a

configuration does exist, it is exactly the kind of emission control solution that staff is trying

to eliminate. That is, an emission control solution that is engineered to only work well during

the official emission test and is intolerant or incapable of similarly robust emission control

under other commonly occurring driving conditions is an unacceptable solution that may

border on being considered a defeat device. Nonetheless, to help balance the development

work that may be needed for some vehicles, staff is proposing a three-year phase-in shown in

Table IV-9 in additional to the lead time before the first model year of the phase-in. The

proposed phase-in schedule is intentionally identical to the phase-in for the partial soak

requirement because both are cold-start requirements and the development work for both

provisions can take place at the same time when a vehicle is being redesigned for a new

generation model or a model refresh. In addition, both cold-start provisions (partial soak and

quick drive-away) will be allowed to utilize alternative phase-in schedules that will provide

further flexibility to automakers’ vehicle plans but will yield the same emission benefits as the

proposed phase-in.

Table IV-9:Phase-in for Quick Drive-Away Standards

Model Year

% of Vehicles Certified to

Quick Drive-Away Standards

2026 30

2027 60

2028 and subsequent 100

5. Proposal: PHEV High-Power Cold-Start Emission Standard

To reduce the emission impacts of high-power cold starts, ACC II will require PHEVs to meet

a new emission standard for a cold-start US06 test. The US06 test reflects an aggressive

0.00

0.05

0.10

0.15

0.20

0.25

0.30

NOx THC

Emissions [g/mile]

10 Low Emitting Vehicles

5 High Emitting Vehicles

117

driving cycle that is more suitable than an FTP test for characterizing high power cold-start

emissions. The proposed emission targets for the cold-start US06 test are based on the best

performing PHEVs tested by staff as shown in Figure 22. The data in the figure shows that 4

of 7 SULEV30 PHEVs had average US06 cold start emissions of 0.100 g/mile or less.

Therefore, to clean up the higher emitting PHEVs, the prosed regulation will set a cold start

US06 emission target of 0.100 g/mile for SULEV30 PHEVs. This standard would apply to 2029

and subsequent model year PHEVs. For PHEVs not currently in a position to comply with this

requirement, this additional lead time will give manufacturers the time necessary to develop

and deploy effective emission control strategies or hardware changes. In the earlier model

years of 2026 through 2028, a higher interim standard of 0.150 g/mile will apply. The interim

standards will provide more immediate emission protection from the worst levels of high-

power cold starts while giving manufacturers a few extra model years to remedy the test-to-

test variations observed on some PHEVs, such as the FCA Pacifica PHEV and the Ford Fusion

PHEV.

Figure 22: Cold-Start US06 Emission Test Results for Various PHEVs

The proposed emission targets for other vehicle emission categories are shown in Table

IV-10. Since the vast majority of current PHEVs are certified at SULEV30, offerings in other

vehicle categories are limited, so the emission standards for the other vehicle categories

were based on a single PHEV tested at SULEV20 and ULEV125. Therefore, a standard of

0.067 g/mile was set for the SULEV20 category and a standard of 0.250 g/mile was set for

the ULEV125 category for 2029 and subsequent model years. The emission standards for

other vehicle emission categories were distributed between the SULEV20, SULEV30, and

ULEV125 categories and the interim 2026-2028 standards were scaled proportionally for all

vehicle emission categories to maintain a similar ratio, relative to the 2029 standards, as

observed for the SULEV30 emission category. Finally, since high-power cold start emissions

are primarily a concern for blended PHEVs, the proposal will include an exemption for US06

cold start emission testing for any PHEV that is non-blended on the US06 cycle, meaning a

PHEV that can drive the US06 cycle using only electric power with zero exhaust emissions.

This will provide further incentive to manufacturers to develop PHEVs that can drive the US06

cycle fully electric, thereby avoiding high power starts altogether in real-world driving that is

at or below the driving behavior represented by the US06 cycle. And, as noted earlier, the

ACC II proposal would also raise the minimum qualifications for future PHEVs to be used in

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

Honda Mitsubishi Volvo FCA Ford Prius

PHEV

Hyundai Prius

Prime

Porsche

NMOG+NOx [g/mile]

ULEV125SULEV20 SULEV30

118

meeting a manufacturer’s ZEV obligation. These qualifications include the ability of the PHEV

to drive a minimum of 40 miles all-electric on the US06 which would make them exempt from

this standard by eliminating the need for most real-world high power starts.

Table IV-10: Proposed Emission Standards for PHEV High Power Cold-Start Test

Vehicle

Emission

Category

NMOG+NOx (g/mi)

2026-2028

2029 and

Subsequent

ULEV125

0.350

0.250

ULEV70

0.320

0.200

ULEV60

0.280

0.175

ULEV50

0.240

0.150

ULEV40

0.200

0.125

SULEV30

0.150

0.100

SULEV25

0.125

0.083

SULEV20

0.100

0.067

SULEV15

0.075

0.050

Feasibility of PHEV high-power cold-start emissions proposal

The proposed regulation will require blended PHEVs to certify NMOG+NOx emissions on a

cold start US06 test cycle to ensure adequate emission control of high-power cold start

emissions. The proposed standards were based on emission levels of the better performing

PHEVs tested by CARB. The majority of PHEVs tested by CARB exhibited emissions below

the proposed standard. However, test-to-test and vehicle-to-vehicle variations may cause

some models to exceed the proposed standards. Vehicle and test variability issues can be

addressed through improved control and calibration in most instances. Therefore, to provide

additional time for automakers to address these variations, staff’s proposal includes higher

interim standards for the 2026 through 2028 model years.

PHEVs that currently exceed the proposed standards will need to implement better emission

control strategies to address high power cold-starts. In general, manufacturers have two

categories of actions they can pursue to meet these standards. First, they can design the

vehicle to have a more capable electric drive propulsion system. At one end, they can design

the system to operate all-electric on the US06 cycle and be exempt from the standard

altogether. Given the future minimum ZEV qualifications for a PHEV will include the ability for

the vehicle to do just that, we expect virtually every future designed PHEV will take that

route and ensure the electric motor(s) and battery are sized sufficiently to do that.

To a lesser extent, the electric drive system could be made more powerful but not all the way

to the point of being able to avoid an engine start on the US06. Directionally, this will still

provide the manufacturer more ability to manage high-power starts by being able to meet

more of the driver’s demand with electric propulsion and require less supplemental power

from the engine. In this manner, the engine can be operated at lower load and speed point

that reduces engine-out emissions during the initial start and provide more ability to

simultaneously warm up the catalyst while also delivering power to propel the vehicle. Staff

expects this may be a likely option for already designed PHEVs that are scheduled to

continue into the 2026 or later model year and have insufficient room to accommodate a

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drop-in replacement motor or battery that is sufficiently powerful to avoid engine starts

altogether on the US06 cycle.

A third approach that can be used, especially in concert with a stronger electric drive system,

is to trigger the initial engine start at a slightly lower power demand than what the electric

drive system can actually deliver. With this approach, the initial engine start can be operated

in a more controlled manner optimized for low emissions while the electric drive system

continues to meet the driver’s demand. The downside of such an approach, however, is that

an engine start may be triggered on a trip that could have avoided a start altogether if the

driver demand just momentarily exceeded the trigger and then dropped back down. In such

cases, the electric drive could have met the driver’s demand fully and not even needed to

turn the engine on.

As an alternative to (or in concert with) changes to electric drive capability, manufacturers

can improve their emission control systems to further reduce emissions at initial engine start.

Some suppliers and manufacturers have been investigating the use of electrically heated

catalysts whereby the catalyst can be heated up electrically prior to or at the same time as

engine start. Such systems can dramatically reduce cold start emissions and the presence of a

high voltage battery on a PHEV means the high electrical power demands of such a system

can be more readily handled. However, maximum reductions of such a technology rely on

being able to preheat the catalyst before engine start, which then introduces the need for

the system to be more predictive in nature in anticipating the upcoming driver demand to be

high enough to need the engine to start.

Even less complex emission hardware changes can result in improved emission control.

Manufacturers are continually optimizing the location, washcoat, and precious metal content

of various catalysts in the exhaust system along with fuel injection system and fast light off air

fuel ratio sensors in the exhaust that balance the needs of the various emission standards.

However, given that cold-start emissions are such a large portion of the emissions on the FTP

test, additional attention is spent on minimizing the formation of the emissions in the

combustion chamber and accelerated light-off of the catalyst. As noted earlier, with an

increased focus on managing start emissions following partial soaks, as well as during quick

drive-away events, manufacturers will need to pay even more attention to this initial burst of

emissions at start. Much of that knowledge will be applicable for PHEVs as well, especially

the improvements targeted for quick drive-aways where, much like the case of high-power

cold-starts on PHEVs, there is a need for the engine to deliver propulsion power while still

taking action to minimize the formation of engine-out emissions and warm up the catalyst.

In addition to the measures noted earlier for control of quick drive away conditions, PHEVs

have the added capability of using the battery and electric motor to actually spin the engine

to a higher engine speed before even initiating fueling. This can provide for more consistent

air flow to the cylinders allowing for better air fuel mixing and initial combustion than a

conventional engine that may only achieve a few hundred revolutions per minute (rpm) via a

starter before fueling must begin. Even after starting the engine, the ability to spin the

engine with electrical power provides manufacturers with the capability to run the engine

with the spark even more delayed than typically feasible on conventional engines and using

the electric power to smooth out the revolutions of the engine from any combustion

instability. This allows even more heat to be generated from the combustion event and

transferred to the catalyst. While this cannot be as readily done at the same time as

significant torque is being requested from the engine due to driver demand, this approach

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can work in cases above where the engine can be started while the electric drive system is

still providing all or most of the driver demand. It can also work in cases where the high

driver demand was only a few seconds long and the engine can default back to operating

conditions optimized for emission control to complete the warm-up after those first few

seconds of providing torque.

Even on some of today’s PHEVs, it seems a variety of these approaches are being used. For

example, the Toyota Prius PHEV and the Toyota Prius Prime demonstrated excellent

emission control on the US06 cycle, as shown in Figure 22, even though they had less battery

energy capacity and lower power electric motors than some of the higher-emitting PHEVs. In

the case of the Prius PHEV, it achieved lower US06 emissions by triggering the combustion

engine to start at a lower power, which prevented the excessive emissions observed with

high power starts. The Honda Clarity PHEV, which had a much higher battery energy capacity

and electric power than the Prius PHEV, also appeared to trigger the combustion engine to

start at a relatively low power demand. Although the total vehicle power demand was higher

than the Prius PHEV, the electric powertrain appeared to provide most of the power during

the initial engine start so that the combustion engine operated at relatively low power during

its initial start. Therefore, the Clarity PHEV also had cold-start US06 emissions that were well

controlled.

In summary, staff projects that the majority of PHEVs will comply with the proposed high

power cold-start emission standards by utilizing bigger batteries and more powerful electric

powertrains that will allow the PHEV to drive the US06 cycle fully electric and avoid

combustion engine starts. These hardware upgrades are expected to be primarily driven by

other regulations, such as PHEV ZEV requirements, rather than the US06 cold-start emission

standards. However, the excellent emission control of the Toyota Prius PHEV and the Toyota

Prius Prime demonstrates that bigger batteries are not necessary to meet the proposed high-

power cold-start standards.

6. Proposal: Lower Running Loss Standard

Despite today’s vehicles having very low evaporative emissions, cumulative hydrocarbon

evaporative emissions from light duty vehicles exceeds the tailpipe hydrocarbon emissions

and is expected to be 75 percent of the emissions by 2040. Evaporative emissions, which

result from fuel vapors escaping from the vehicle rather than tailpipe emissions from engine

combustion, consist of hydrocarbons that contribute to the formation of ozone. Running loss

emissions are a type of evaporative emissions that occur when fuel vapors escape from the

vehicle during driving. Manufacturers are required to certify vehicles to the running loss

standard by driving a vehicle over a prescribed drive cycle on a dynamometer and measuring

the resulting evaporative emissions as captured in a sealed enclosure around the vehicle

during testing. The current running loss emission standard of 0.05 grams per mile has not

been changed since its introduction in the 1990s. Based on manufacturers’ 2019 model year

certification data, the vast majority of the vehicles (87 percent) were certified as emitting at

or below 0.01 gram of hydrocarbons per mile. Therefore, staff proposes to reduce the

evaporative emission running loss standard from 0.05 grams per mile to 0.01 grams per mile

of hydrocarbons. The goal of the proposed amendments is to ensure that vehicles already

meeting much more stringent emission levels continue to perform at those levels and to

further reduce emissions from the small proportion of vehicles that are currently certifying at

higher emission levels.

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Feasibility of the lower running loss standard

As noted, 87 percent of the 2019 model year fleet already is certifying at or below the

proposed standard as show in Figure 23 below. These vehicle models span the full range of

vehicle sizes, classes, and powertrain technologies. Staff analyzed the data, including the

type of test method used to measure running loss emissions and the fuel tank size, but found

no consistent trends across the higher-emitting vehicles to suggest that there is a technical

hurdle to those vehicles being able to meet the lower standard. Discussions with

manufacturers and supplier also confirmed there were no known technical reasons to support

why certain vehicles could not be designed to meet the requirements.

Figure 23: Certification Data for 2021 MY for Running Loss

Given that the new standard phases in for model year 2026 to 2028 vehicles, and less than 10

percent of vehicles are expected to need to make a change, manufacturers have the time

needed to integrate such design improvements during a normally scheduled redesign cycle.

Based on feedback from manufacturers, it is expected that small number of vehicle models

not meeting this standard will likely be improved by adjusting the layout of the fuel system

components to reduce heating of the fuel tank, which will result in less fuel vapor formation

and thus is expected to reduce evaporative emissions. Going forward, manufacturers would

be expected to continue to design their evaporative systems to meet the standard

7. Proposal: PEMS In-use Standards for MDVs greater than 14,000

GCWR

The proposed regulation will require that 2027 and subsequent model year chassis certified

medium-duty vehicles with a gross combined weight rating (GCWR) over 14,000 pounds to

meet a new in-use requirement moving average window (MAW) requirement using a new

test procedure. The test procedures and standards for this new in-use requirement are very

92% of

2021MY

fleet at or

below 0.01

g/mile

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similar to those CARB recently adopted as part of the Heavy-Duty Low NOx Omnibus

rulemaking

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at the August 2020 board hearing. Traditionally, medium- and heavy-duty

vehicles have been expected to have more similar usage patterns in that they represent

heavier, larger, more capable vehicles in terms of carrying capacity and towing capacity that

are often used to perform work rather than as personal vehicles. In some cases, the same

engine can be used in medium-duty and some of the lighter heavy-duty applications.

However, the current options available for certification of MDVs do not ensure consistency in

emission control across the various options nor do they adequately ensure emissions are

adequately controlled during all engine operations that occur on-road, especially during

towing.

The new in-use requirement for chassis certified MDVs will require manufacturers to design

the emission controls to meet an in-use emission standard that is measured by a Portable

Emissions Measurement System (PEMS) temporarily installed on the vehicle during on-road

driving. The PEMS unit is used to measure and record emissions data from the vehicle

tailpipe. The method for analyzing the collected data is referred to as the Moving Average

Window (MAW) method and was adopted recently for use on 2024 and subsequent model

year heavy-duty engines. This method analyzes the PEMS data over continuous five-minute

windows that start at every second and will be overlapping. For example, a 10-minute trip

can consist of 300 overlapping windows with the first window concluding at 5 minutes into

the trip and the second window concluding 1 second later and so on. Each 5-minute window

is also analyzed for average engine load and the emission results of each window are then

added to one of three bins, as described below, based on the average engine load. Each of

these 3 bins has its own corresponding emission standard to which the measured emission

results are compared.

For diesel MDVs, each window is sorted into one of three different bins based on the engine

percent load which is calculated based on the vehicle’s CO

emissions. Criteria emissions for

each bin are calculated using a defined sum-over-sum (SOS) equation and then compared to

the emission standard for that bin. The first bin is the idle bin and consists of windows with an

average engine load of less than 6 percent, the second bin is the low load bin and consists of

windows with average engine load ranging from 6 to 20 percent, and the last bin is the

medium/high bin with windows with average engine load greater than 20 percent. Each bin

has its own specific standard. For gasoline MDVs, the primary difference is that there is only

one bin that all window results are added to and a single standard for that bin.

The emissions evaluated during in-use PEMS testing will consist of NOx, NMHC, CO, and

PM. In addition to meeting the standard, manufacturers will be responsible for conducting

self-testing of a number of vehicles each year and reporting for the test groups selected by

CARB. As with any standard, CARB can also conduct its own testing of vehicles to determine

if a manufacturer’s vehicles are meeting the required standard

Feasibility of meeting the PEMS in-use standard

The feasibility for meeting the proposed MAW in-use standards was demonstrated in the

recently adopted Heavy-Duty Low NOx Omnibus rulemaking. Southwest Research Institute

388

For more information regarding the CARB Heavy-Duty Omnibus Regulation, visit

https://ww2.arb.ca.gov/rulemaking/2020/hdomnibuslownox

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(SwRI) researched and performed testing to determine a diesel technology package that

could meet the proposed standards. Below in Figure 24 is a diagram of the emission control

system for a diesel vehicle that SwRI determined could help with meeting the standards of

the MAW during idle, low load, and medium/high load operations. The technology package

uses multiple selective catalyst reduction (SCR) catalysts, diesel exhaust fluid dosing, and

ammonia slip catalysts (ASC). The light-off SCR is meant to handle cold temperature and low-

load emissions, while the larger SCR system would handle the higher emission flow rates

during medium and high load operations. The ASC and multiple dosing systems would

improve the conversion efficiency of the SCR systems. Another technology demonstrated by

SwRI was cylinder deactivation, which can help with controlling low-temperature emissions.

Along with these hardware changes, calibration will help ensure robust emission controls

during all engine operation.

Staff also tested multiple MDVs to assess their current performance in the laboratory as well

as on the road while towing. Currently, these vehicles are only designed to meet the

regulatory cycles of the FTP and supplemental FTP (SFTP), which represent urban (FTP) and

aggressive (SFTP) driving. The SFTP test cycle is performed with the catalyst at optimal

temperatures and the test cycle consist of high speeds and high accelerations. Of particular

interest during CARB testing was the 2019 Ram pick-up with the Cummins 6.7L engine that

was the subject of an emission recall by CARB. The recall, which consisted of only a software

update and no hardware change,

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produced dramatic emission reductions in higher speed

and load operating conditions on a truck designed to meet 2019 model year standards nearly

an order of magnitude higher than the proposed MAW standards. In comparing pre-and

post-recall emission levels for the applicable SFTP cycle, the vehicle achieved a 97 percent

reduction in emissions. CARB’s on-road testing of this vehicle after the recall recalibration

showed it was one of the best performers for emissions across all operation including towing.

When evaluated using the proposed MAW method, it showed much lower emission levels

than the other vehicles, and this performance was achieved using a hardware configuration

designed for the 2019 model year with no intent to be capable of meeting the future MAW

standards. The recalibration makes it close to meet the 2027 standard without any hardware

changes. Given the lead time with this proposal and the ongoing work by all manufacturers

towards the already adopted heavy-duty standards phasing in before these proposed

standards, it would be expected that further hardware changes and software refinements

would be developed to reach the levels demonstrated by SwRI.

389

NHTSA 2020. FCA Emissions Recall VB6 Diesel Engine Calibration, February 2020: “The engine control

software… must be

updated with an upgraded calibration as required by the US Environmental Protection Agency and California

Air Resources Board for better emission performance. https://static.nhtsa.gov/odi/tsbs/2020/MC-10173340-

9999.pdf

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Figure 24: Heavy-duty Low NOx Omnibus Diesel Technology Package

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For gasoline MDVs, staff’s analysis showed that their emissions were much better controlled,

and many were not rated for as high of a towing capacity as diesel vehicles. Therefore,

gasoline vehicles will require fewer hardware changes than diesel vehicles to meet the

proposed MAW standards. The heavy-duty Low NOx Omnibus rulemaking had determined

the only change needed would be to the three-way catalyst (TWC) system. These changes

would be similar to what was previously mentioned such as catalyst sizing, precious metal

loading, and use of multiple TWC systems. The Manufacturers of Emission Control

Association (MECA) had shown CARB several other technologies that are available for

gasoline vehicles and could be used on gasoline MDVs. These technologies include cylinder

deactivation, electrically heated catalysts, electronic throttle control, cooled exhaust

manifold, and advanced transmissions which could be used to help reduce emissions over all

engine operations. With further electrification of the MDV fleet and improvements in

technology, the use of electronically controlled components is also a feasible option.

The proposed MAW standards would apply to model year 2027 and subsequent chassis-

certified MDVs. Most MDV manufacturers also have heavy-duty engines that will have to

meet the heavy-duty MAW in-use standards starting in model year 2024, therefore much of

the research and development used for these manufacturer’s heavy-duty engines would likely

carry over to the engines used for chassis-certified MDVs. The chassis certification MAW

standards will align with the heavy-duty standards in 2027 model year and staff is proposing

to allow a similar conformity factor (CF) of 2.0 for model years 2027-2032 and 1.5 for 2033

and beyond. The higher interim CF effectively reduces the stringency for manufacturers by an

additional 50 percent of the standard in the early years to provide additional time for the

manufacturer to refine its control of emissions during the broader scope of in-use conditions

subject to the MAW standard.

8. Proposal: Lower Emission Standards for MDV

This proposal has three element: lower fleet average standard, delete highest-emitting bins

and add lower bins, and eliminate ZEVs from the calculation of fleet average. For

certification, chassis-certified MDVs are required to be tested on the Federal Test Procedure

(FTP) test cycle and meet the emission standards for that test cycle on a chassis

390

CARB 2020c. “Standardized Regulatory Impact Assessment (SRIA): Proposed Heavy-Duty Engine and Vehicle

Omnibus Regulation and Associated Amendments.” DOF, CARB, 2020,

www.dof.ca.gov/Forecasting/Economics/Major_Regulations/Major_Regulations_Table/documents/CARB%20SRI

A%20Heavy%20Duty%20Engine%20Standards.pdf

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dynamometer. The FTP test cycle measures emissions during the cold start and the drive

cycle which is representative of urban driving. Manufacturers can choose from several

defined emission bins for certification for each test group. The current regulations allow

manufacturers to certify to NMOG+NOx emission bins ranging from 0.150 g/mile up to

0.250 g/mile for Class 2b and 0.200 g/mile to 0.400 g/mile for Class 3.

To ensure manufacturers certify to more stringent FTP bin standards over time, they are

required to meet a declining FTP NMOG+NOx fleet average standard. In order to meet the

fleet average standard, the manufacturer’s sales-weighted emissions for their entire fleet

must have average FTP emissions below the fleet average standard for that model year. The

LEV III MDV fleet average standards started with model year 2016 and become more

stringent each subsequent model year until 2022. After model year 2022, the fleet average

standards remain constant with class 2b and class 3 each having their own respective

standards.

In 2022 the fleet average standard is 0.178 g/mile and 0.247 g/mile for Class 2b and 3,

respectively. Currently, manufacturers are meeting this fleet average with a mix of vehicles

certified to bins above and below this fleet average. Emission control technology has

continued to evolve in both the light-duty sector, where manufacturers continue to certify an

increasing fraction of their fleet to very low-emission levels to meet the decreasing fleet

average, and in the heavy-duty sector where the recent Heavy-Duty Low NOx Omnibus

rulemaking established standards representing a 90 percent reduction from today’s heavy-

duty standards starting in 2024 model year. MDVs have often shared powertrains with

slightly smaller light-duty applications or slightly heavier heavy-duty applications or used

powertrains evolved from similar powertrains in those other classes. Accordingly, the

ongoing improvements in vehicles both lighter and heavier support the need and capability

of the MDVs to also meet more stringent standards than they are meeting today. The

proposed regulation will further reduce both fleet average standards to 0.150 g/mile and

0.175 g/mile for class 2b and 3, respectively, starting in the 2026 model year.

In addition, this proposal includes the removal of medium-duty ZEVs from being included in

the fleet average in 2026 for both class 2b and class 3. Manufacturers are currently meeting

the final LEV III fleet average, which is fixed from 2022 model year on, without any

manufacturer having any ZEVs included in that fleet average. However, as the Advanced

Clean Trucks (ACT) regulation takes effect beginning in 2024 model year, and consistent with

announcements from several manufacturers for ZEV offerings in the MDV sector, ZEVs are

expected to gradually increase in volume in the MDV sector. Absent a change in the way the

fleet averages can be calculated, this increasing fraction of ZEVs would allow manufacturers

to backslide on their gasoline and diesel engines and certify an increasing share of them to

dirtier and dirtier emission bins while still meeting the fleet average. By removing the ability

to include ZEVs in the fleet average, manufacturers will be required to at least keep the non-

ZEVs certified to the lower standards that they have already achieved and then to increase

the share of their engines certified to the lower bins to meet the proposed further reductions

in the fleet average.

As noted earlier, the current regulations allow manufacturers to certify to bins ranging from

0.150 g/mile up to 0.250 g/mile for Class 2b and 0.200 g/mile to 0.400 g/mile for Class 3. As

with staff’s proposal for passenger cars and trucks, staff propose to eliminate the dirtiest

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emission bins for MDVs and add lower emission bins to expand manufacturers options to

certify vehicle at lower emission levels. Specifically, the proposal would remove the two

dirtiest FTP bins from class 2b and class 3 as shown in Figure 25 below, and add 4 new

additional bins at lower emission levels for each class.

Figure 25: Proposed Changes to Certification Bins for the Medium-duty Fleet

Feasibility of lower fleet average standard

Staff’s analysis of model year 2021 certification data has shown that 67 percent of the class

2b test groups and 54 percent of class 3 MDV test groups are already emitting at levels

below the proposed 2030 fleet average even when including manufacturer-derived

deterioration factors to represent the expected amount of deterioration that will occur

during the useful life of the vehicle. While manufacturers would typically also certify with

some headroom, or margin, below the standard to account for other variations that can

occur, many vehicles are already emitting, now in the 2021 model year, at low enough levels

to easily meet the 2030 fleet average. When the current performance is combined with the

rather modest additional proposed reductions in the fleet average of 16 percent for class 2b

and 30 percent for class 3b and the seven years of lead time to get there, the manufacturers

are well-positioned to meet the proposed standards.

Manufacturers would be expected to implement further improvements to the higher emitting

test groups to meet the proposed phase-in. To a large extent, this likely could be met

primarily with catalyst system improvements. In comparing the catalyst information between

test groups that were already emitting at levels that could meet the proposed standards and

those that were not, staff found that most test groups that could already meet the proposed

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standards had directionally higher precious metal loadings than those that had higher

emissions. While this may account for much of the needed reductions, staff expects many

products will need further changes to meet the more stringent standards.

Improvements required to meet the MAW standard discussed earlier, as well as the stand-

alone SFTP standards discussed below, are expected to also reduce emissions on the FTP

test cycle. This is supported by the improvements observed in the pre-emission recall 2019

model year Ram 2500 and 3500 pick-ups with Cummins 6.7L engines and post-recall 2020

model year versions of the same products. Comparison of FTP results shows a 29 percent

lower FTP result for the class 2b (and 11% for the class 3) after the software only recall that

predominantly improved warmed-up emission control at the edges of and outside of the

engine speed and load regions encountered during the FTP. Those types of calibration

changes are in line with the types of actions that would be expected to be done to future

engines to be able to meet the MAW and SFTP standards. And on the class 2b vehicle, such

changes appear sufficient in magnitude to meet the future fleet average while on the class 3,

further reductions would still be necessary.

To achieve the further reductions necessary to certify vehicles to the lower bins, it is

expected that MDV manufacturers would need to target reductions of cold start emissions

given the much higher emissions at cold start and the higher weighting of those emissions in

the calculated FTP result. Much the same as light-duty, manufacturers would likely target

strategies that minimize engine out emissions and accelerate aftertreatment warm-up. And

these would likely be a mix of hardware and software changes. For example, to achieve

faster warm-up of the aftertreatment, manufacturers may use a combination of strategies that

increase exhaust temperatures such as initiating combustion later in the cylinder so the

exiting exhaust gases are hotter, moving a portion of the aftertreatment system closer to the

exhaust manifold, minimizing the thermal mass of the front portions of the aftertreatment

system to facilitate quicker warm-up, better thermal management of the exhaust manifold

and exhaust pipe to allow more heat to the aftertreatment, and changes to the

aftertreatment washcoat, precious metal loading, and wall structure and cell density to

increase activity at lower temperatures and warm up faster.

For engine out emission reductions, manufacturers could utilize many of the technologies

previously identified in the LEV III rulemaking and the Heavy-Duty Low NOx Omnibus

rulemaking to generate more complete combustion in the cylinder and minimize the

formation of criteria pollutant byproducts. In gasoline products, this can include base cylinder

design and piston shape to reduce crevice volumes, oil intrusion into the combustion

chamber, and wall-wetting from injected fuel impinging on cylinder walls that increases the

engine out emission. It can also include earlier and better closed loop fuel control from the

use of fast light off air fuel ratio sensors that are able to provide feedback to finetune the

injected fuel amount to more capable high pressure direct injection fuel injectors that are

able to more precisely deliver atomized fuel in the right quantity, timing, and dispersion

pattern for optimal combustion. In diesel engines, the improvements include actions to

facilitate faster warm-up of the combustion chamber such as exhaust gas recirculation cooler

bypasses which initially can recirculate hotter exhaust gas to aid in warm-up, strategies and

valving to support faster warm-up of the engine coolant and oil, and in-cylinder actions such

as higher pressure fuel injectors that can deliver fuel in multiple discrete injection events to

facilitate the initiation of good combustion before delivering the majority of fuel for that

combustion event. In summary, certification results show that manufacturers today can meet

lower fleet average standards and the technology exists to make these vehicles even cleaner.

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Figure 26: Certification Data for Class 2b and 3 Test Groups with Deterioration Factor

(DF*) Compared to Proposed Fleet Average Standard in 2030+ Model Year

* The certification data used for the analysis includes a manufacturer-derived deterioration factor (DF) applied to each test

group to determine the emissions at full-useful life. The DF is determined from testing with fully aged aftertreatment

systems or based on calculations that are applied to the emission test results for that test group.

9. Proposal: Standalone Standards for MDV for Aggressive Driving

Cycles

To ensure better emission control for MDV aggressive driving cycles, staff is proposing a

standalone standard to replace the SFTP composite standard calculation. The SFTP

composite standard gave manufacturers flexibility when they calibrated their emission

controls but the issue that staff has identified is that a manufacturer can have very high

emissions on an individual test cycles, and due to how the composite value is calculated, they

can still meet the SFTP composite standard. This does not ensure robust emission controls

during aggressive driving on the regulatory test cycles such as the US06 or Unified Cycle and

increases the risk that vehicles operated more frequently in these conditions will

disproportionally emit higher emissions. The US06 test cycle is the certification test cycle for

class 2b and the Unified Cycle is the certification test cycle for class 3. They both represent

aggressive driving with high speeds and accelerations, but the Unified Cycle has less

aggressive accelerations than the US06. This is necessary for class 3 vehicles, which are

heavier and have difficulty following the US06 drive trace. Certification data and CARB’s own

testing has shown there can be very high emitters on these test cycles—in some cases up to

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1 g/mile for NMOG+NOx on the US06 test cycle. This is more than two times higher than the

class 2b SULEV composite standard of 0.450 g/mile for NMOG+NOx. Based on CARB’s

certification data, presented in Appendix H, other pollutants such as carbon monoxide (CO)

and PM are also showing much higher emission results on the individual test cycle but are still

able to meet the SFTP composite standard. Emissions for some test groups can have CO

emissions for the US06 in the 40 to 55 g/mile range when the composite standard is only 22

g/mile for a ULEV and 12 g/mile for a SULEV. For PM, emissions for some test groups were

as high as 24 mg/mile range when the applicable US06 SFTP composite standard is 10

mg/mile. While the majority of test groups show emissions that are well controlled across all

the cycles, the SFTP composite standard allows for some test groups to have very poor

emission control in specific types of vehicle operation.

As with passenger cars and trucks, staff’s proposal changes the certification options and

emission standards for test cycles representing aggressive driving for MDVs. Starting with

2026 model year and phasing in over 4 years, the proposal will eliminate the composite

average certification option and instead require all vehicles to certify to test cycle specific

standards for the US06 (or Unified cycle, as currently allowed based on the weight category

the vehicle is certified to). The standard would require class 2b and class 3 MDVs to meet the

same emission levels as the FTP emission bin the vehicle is certified to. For instance, a

vehicle certified to an FTP standard of 0.150 g/mi for NMOG+NOx would similarly need to

meet 0.150 g/mile on the applicable aggressive test cycle. These changes will clean up the

highest emitting vehicles in the fleet by ensuring all vehicles have good emission control

during aggressive driving. Further, while the test cycle used was developed to represent

more aggressive driving, it also results in the engine being operated at higher speeds and

loads than the standard FTP test. In-use, this can translate to not just more aggressive

accelerations and speeds but also other driving conditions that increase engine load such as

mild grades or moderately heavy loads that may be more common in MDVs.

Feasibility of MDVs meeting standalone standards for aggressive driving

CARB’s test data and 2021 model year certification data on the SFTP test cycle has shown

many test groups have NMOG+NOx emission levels already below their FTP certification bin

standard. Figure 27 shows test data for class 2b MDVs on the full US06 test cycle used as

part of staff’s analysis. While not immediately intuitive, it would be expected that SFTP

emissions could and should be lower than FTP emission levels. Unlike an FTP which includes

a cold engine start that has much higher emissions and is heavily weighted in the results, the

SFTP test cycle is a hot test, performed after the engine has already been started and the

engine and emission controls are fully warmed-up. While it does include some aggressive

accelerations and higher vehicle speeds, having the engine and emission controls already at

an optimal temperature provides the potential for extremely effective emission control. If the

catalyst system is sized appropriately to ensure it can handle the highest exhaust flow rates

during the test, emissions should be much lower than emissions during the FTP with a cold

start. Clear evidence of this exists with the 2019 Ram Pick-up with Cummins 6.7L diesel

engine that was tested by CARB. This engine had previously been subjected to an emission

recall software update and demonstrated extremely effective emission control on the SFTP

test cycle with emissions of 0.034 g/mile for NMOG+NOx while originally being certified to

meet a 0.200 g/mile FTP level. After the recall, the actual FTP emission levels were slightly

lower but still more than three times higher than the SFTP results supporting that warmed up

emissions, even over a more aggressive driving cycle, can readily be much lower than the FTP

certification standard.

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Manufacturers would be expected to use the same robust emission control already deployed

during the FTP test to achieve very low emissions levels on the warmed-up portions of that

test to similarly achieve very low emission levels during the warmed-up SFTP test. For diesel

engine vehicles, this primarily consists of expanding the same level of emission control to

minimize engine out emissions and ensure proper dosing of diesel exhaust fluid for the SCR

catalyst to handle the engine out NOx. This also appears to be consistent with the actions

taken by Cummins for the emission recall noted above that consisted solely of a software

update and resulted in minimal change in the FTP emission levels (where the system already

exhibited reasonable emission control even during the warmed-up portion of the test) but a

dramatic 90 plus percent reduction in warmed up test cycle results such as the SFTP.

Directionally, the much more extensive changes manufacturers will need to make to comply

with the future MAW standards described above will also help as they will need to ensure

they have better capability to achieve high SCR conversion efficiency and low engine out

emissions during higher exhaust flow rates.

For gasoline engine vehicles, manufacturers appear to already be quite capable of meeting

the proposed SFTP standards. Directionally, this is expected as warmed-up gasoline

operation even on the FTP results in very low emissions relative to the cold start emission

levels that dominate the FTP test. As described for light-duty emission standards earlier, the

primary tools to ensure emissions are well controlled on the SFTP include a sufficient catalyst

system volume and loading to handle the higher exhaust flow rates and good transient fuel

control to precisely match fuel quantity to the rapidly changing air mass during accelerations.

With today’s suite of controls including electronic throttle that manufacturers use to more

predictably and precisely match fueling to the air change, variable valve timing and controls

to influence air mixing and charge as well as function in place of an exhaust gas recirculation

system, and wide-range air fuel ratio sensors to provide more detailed information for

feedback to the closed loop fuel control system, manufacturers are largely able to maintain a

stoichiometric ratio under the vast majority, if not all, of the test cycle. This allows the most

complete combustion and fewest byproducts of criteria pollutants that otherwise occur in

temporary lean and rich excursions. Further, today’s gasoline three-way catalysts are able to

maintain good conversion efficiency of hydrocarbons even in temporary rich excursions that

may occur on some MDVs operated at heavier sustained loads that trigger power enrichment

or catalyst overtemperature protection strategies that rely on enrichment to keep the catalyst

from reaching excessive temperatures. This was seen even in CARB development tests

exploring testing of MDVs at simulated higher test weights or payloads where the control

system entered enrichment, CO emissions were elevated, but hydrocarbon emissions

remained at relatively moderate well-controlled levels.

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Figure 27: CARB Test Data Class 2b NMOG+NOx Full US06 Test Cycle

10. Summary of OBD Proposal

To address vehicle manufacturers’ concerns regarding not knowing with certainty at what

emission levels their OBD systems will be able to detect faults, CARB staff worked with

vehicle manufacturers to develop interim thresholds and is proposing amendments to the

OBD II regulation to incorporate those thresholds. For the new emission bins that are at a

stringency between existing bins (like ULEV60 which sits between existing ULEV70 and

ULEV50 bins), the vehicle manufacturers submitted suggested thresholds that CARB agrees

are appropriate interim levels. For new emission bins that are lower than the most stringent

existing emission bin, the proposal effectively uses the absolute threshold of the most

stringent existing bin and increases the multiplier of each lower bin to match that same

absolute threshold. This largely mimics what was previously done in the heavy-duty Omnibus

Low NOx rulemaking that also adopted lower emission standards for heavy-duty engines and

put in place interim OBD thresholds for those new lower standards. With this relief, vehicle

manufacturers can first focus on the necessary emission control solutions to meet the lower

standards before turning to improvements that may be necessary to ensure robust detection

of faults at the lower emission levels. However, these higher interim OBD thresholds

directionally allow malfunctioning vehicles to have emissions that are proportionally higher

before detecting a fault, which would reduce the benefits of the proposed emission

standards. Accordingly, it will be imperative that these thresholds are monitored and, if

needed, adjusted to ensure the benefits of the proposed standards are protected.

Based on past experience, staff expects that the majority of monitors will already be capable

of detecting faults at emission levels lower than the proposed thresholds with minimal

revision as changes to improve the emission controls generally also improve the resilience of

such controls to degradation. For example, some emission control systems can be designed

with adaptive controls such that, as the component degrades, the system automatically

adjusts to compensate. In such a system, essentially no degradation in emissions occurs until

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the system is so degraded that the system reaches its maximum control authority and can no

longer compensate. From the information submitted during OBD certification, staff would be

able to verify both the emission level at which faults are actually being detected and the level

of degradation of the component being detected. If manufacturers are able to calibrate the

system to delay detection of faults until even more component degradation occurs than is

typical of today’s OBD systems, it will be a clear indication that the malfunction threshold

relief at these lower emission bins is not needed and will support an immediate further

tightening of the threshold. Accordingly, staff expects to track manufacturers’ progress at

these lower emission standards and pursue adoption of more appropriate malfunction

emission thresholds at a future OBD regulatory update.

D. Other Test Procedure Modifications

1. Proposed Split of California’s Light- and Medium-Duty Vehicle Test

Procedure

California’s “California 2015 and Subsequent Model Criteria Pollutant Exhaust Emission

Standards and Test Procedures and 2017 and Subsequent Model Greenhouse Gas Exhaust

Emission Standards and Test Procedures for Passenger Cars, Light Duty Trucks, and Medium

Duty Vehicles” is being split into two separate test procedures to correspond with the

adoption of new criteria pollutant emission standards and test requirements for 2026 and

subsequent model year light- and medium-duty vehicles. The portions of this test procedure

that will no longer apply to 2026 and subsequent model year vehicles have been removed

from the new procedure. The renamed “California 2015 and Subsequent through 2025

Model Criteria Pollutant Exhaust Emission Standards and Test Procedures and 2017 and

Subsequent Model Greenhouse Gas Exhaust Emission Standards and Test Procedures for

Passenger Cars, Light Duty Trucks, and Medium Duty Vehicles” will be used to certify all

2025 and prior model year light-duty and medium-duty vehicles certifying to the

requirements in title 13, CCR, section 1961.2. The new “California 2026 and Subsequent

Model Criteria Pollutant Exhaust Emission Standards and Test Procedures for Passenger

Cars, Light Duty Trucks, and Medium Duty Vehicles” will be used to certify all 2026 and

subsequent model year light-duty and medium-duty vehicles certifying to the requirements in

title 13, CCR, section 1961.4, including those that continue to certify to SFTP standards in

title 13, CCR, section 1961.2 during the phase-in of the new SFTP standards.

2. Proposed Split of California’s Evaporative Emissions Test Procedure

California’s ““California Evaporative Emission Standards and Test Procedures for 2001 and

Subsequent Model Years” is being split into two separate test procedures to correspond with

the adoption of evaporative emission standards and test requirements for 2026 and

subsequent model year light- and medium-duty vehicles. The portions of this test procedure

that will no longer apply to 2026 and subsequent model year vehicles have been removed

from the new procedure. The renamed “California Evaporative Emission Standards and Test

Procedures for 2001 through 2025 Model Passenger Cars, Light-Duty Trucks, Medium-

Duty Vehicles, and Heavy-Duty Vehicles and 2001 and Subsequent Model Motor

VehiclesMotorcycles” will be used to certify all 2021 through 2025 model year light-duty,

medium-duty, and heavy-duty vehicles. The new “California Evaporative Emission Standards

and Test Procedures for 2026 and Subsequent Model Year Passenger Cars, Light-Duty

133

Trucks, Medium-Duty Vehicles, and Heavy-Duty Vehicles” will be used to certify all 2026 and

subsequent model year light-duty, medium-duty, and heavy-duty vehicles.

3. Proposed Amendments to California’s Non-Methane Organic Gas

Test Procedure

The “California Non-Methane Organic Gas Test Procedures for 2017 and Subsequent Model

Year Vehicles” contains a number of references to the current “California 2015 and

Subsequent Model Criteria Pollutant Exhaust Emission Standards and Test Procedures and

2017 and Subsequent Model Greenhouse Gas Exhaust Emission Standards and Test

Procedures for Passenger Cars, Light-Duty Trucks, and Medium-Duty Vehicles.” Since this

test procedure is being split into two test procedures, as noted above, it is necessary to

modify the “California Non-Methane Organic Gas Test Procedures for 2017 and Subsequent

Model Year Vehicles” to reflect this change.

4. Proposed Amendments to California’s Test Procedures for Evaluating

Substitute Fuels and New Clean Fuels

The “California Test Procedures for Evaluating Substitute Fuels and New Clean Fuels in 2015

and Subsequent Years” is currently used to evaluate the potential emissions impact of

proposed substitute fuels and new clean fuels on vehicles that certify to the LEV II standards

in title 13, CCR, section 1961 and the LEV III standards in title 13, CCR, section 1961.2. This

test procedure is being modified to also allow it to be used to evaluate the potential

emissions impact of proposed substitute fuels and new clean fuels on vehicles that certify to

the LEV IV standards in title 13, CCR, sections 1961.4. References to the current “California

2015 and Subsequent Model Criteria Pollutant Exhaust Emission Standards and Test

Procedures and 2017 and Subsequent Model Greenhouse Gas Exhaust Emission Standards

and Test Procedures for Passenger Cars, Light Duty Trucks, and Medium Duty Vehicles” have

also been changed to reflect the split in this test procedure, as noted above.

V. The Specific Purpose and Rationale of Each Adoption,

Amendment, or Repeal

California Government Code section 11346.2(b)(1) requires a description of the specific

purpose for each proposed adoption, or amendment, the problem the agency intends to

address with the proposed regulation, and the rationale for determining that each proposed

adoption and amendment is reasonably necessary to both carry out the purposes of CARB

staff’s proposal and to address the problems for which it is proposed.

The overarching purpose of the proposed regulation is to reduce harmful emissions from

motor vehicles. The problems these emissions cause are described above in Chapter II.

Appendix X: Purpose and Rationale presents the summary of each proposed amendment

and describes its purpose and rationale for its role reducing emissions from motor vehicles.

134

VI. Benefits Anticipated from the Regulatory Action, Including the

Benefits or Goals Provided in the Authorizing Statute

The purpose of the proposed regulation is to clean up on-road emissions from new vehicles

by tightening emission standards for ICEVs and requiring an increasing percentage of sales to

have zero exhaust emissions and meet certain minimum requirements. California Government

Code section 11346.2(b)(1) also requires a description of the benefits of the proposed

regulatory action. The benefits of the proposed regulations will be to significantly reduce

criteria, toxic, and GHG emissions from this sector. Reducing these harmful emissions will

protect and improve public health and contribute to stabilizing the climate.

The transition to clean technology will also have many economic benefits. It will reduce the

need to expend funds on non-sustainable, non-renewable products. It will reduce

comprehensive transportation expenses for consumers. It will incentivize investments in and

the development of new technologies and associated goods and fixtures.

The regulatory action furthers multiple statutory directives. It furthers the maximum degree

of emission reductions possible from vehicles.

391

It furthers controlling emissions of toxic air

contaminants to levels which prevent harm to public health.

392

It furthers meeting the State’s

obligations under the implementation plan required by the federal Clean Air Act to achieve

health-based air quality standards.

393

It furthers reducing GHG emissions to meet the State’s

mandatory limits.

394

It furthers improvements in access to clean transportation and in

reducing disparate impacts of air pollution and climate change.

395

The regulation is also an important new action to support Governor Brown’s Executive Order

B-55-18, which sets a target to achieve carbon neutrality in California no later than 2045 and

maintain net negative emissions thereafter, and Governor Newsom’s Executive Order N-79-

20, which establishes a target to end sales of ICE passenger vehicles by 2035.

A. Summary of Emission Benefits

The proposed regulations would increase new vehicle sales of BEVs, PHEVs and FCEVs and

reduce emissions from the remaining new ICEVs sold. Increased use of ZEVs penetrating the

California fleet will reduce upstream and vehicle GHG, criteria (HC, NOx, PM2.5), and toxic

emissions. Through the proposed regulation, California will see a cumulative reduction over

the period of 2026 to 2040 of 69,569 tons NO

, 4,469 tons PM

2.5

and 383.5 MMT of CO

emissions (well-to-wheels emissions accounting for fuel production). These emission

reductions are described in further detail in Appendix D.

California needs these emission reductions, especially of the pollutants that cause ozone. For

the South Coast and San Joaquin Valley air basins, there are impending deadlines to attain

various NAAQS: 2022 for 1-hour ozone, 2023 for 80 ppb ozone, 2024 for 24-hour PM2.5,

2025 for annual PM2.5, and 2031 for 75 ppb ozone, as well as later years. Attaining these

391

Health & Saf. Code, § 43018.

392

Health & Saf. Code, § 39650.

393

Health & Saf. Code, § 39602.5.

394

Health & Saf. Code, § 38562.

395

Health & Saf. Code, §§ 38565, 44391.2.

135

NAAQS, especially for ozone, requires sustained, comprehensive action to reduce emissions

from all categories of sources. For instance, to achieve the ozone standards by 2031, CARB

must reduce smog-forming NOx emissions from on-road light-and heavy-duty vehicles by

85% from 2015 levels.

396

B. Summary of Health Benefits

The proposed regulation reduces NOx and PM

2.5

emissions, resulting in health benefits for

individuals in California. CARB analyzed the value of health benefits associated with four

health outcomes under the proposed regulation and potential alternatives: cardiopulmonary

mortality, hospitalizations for cardiovascular illness, hospitalizations for respiratory illness, and

emergency room (ER) visits for asthma. The proposal is estimated to lead to 1,242 fewer

cardiopulmonary deaths; 208 fewer hospital admissions for cardiovascular illness; 249 fewer

hospital admissions for respiratory illness; and 639 fewer emergency room visits for asthma.

These and other health impacts have been identified by U.S. EPA as having a causal or likely

causal relationship with exposure to PM

2.5

based on a substantial body of scientific

evidence.

397

U.S. EPA has determined that both long-term and short-term exposure to PM

2.5

plays a causal role in premature mortality, meaning that a substantial body of scientific

evidence shows a relationship between PM

2.5

exposure and increased risk of death.

397

This

relationship persists when other risk factors such as smoking rates, poverty and other factors

are taken into account.

397

U.S. EPA has also determined a causal relationship between non-

mortality cardiovascular effects and short- and long-term exposure to PM2.5, and a likely

causal relationship between non-mortality respiratory effects (including worsening asthma)

and short- and long-term PM

2.5

exposure.

397

These effects lead to hospitalizations and ER

visits, and are included in this analysis.

Staff evaluated a limited number of statewide non-cancer health impacts associated with

exposure to PM

2.5

and NOx emissions from light-duty vehicles. NOx includes nitrogen

dioxide, a potent lung irritant, which can aggravate lung diseases such as asthma when

inhaled.

398

The health impacts from NOx that are quantifiable by CARB staff occur from the

conversion of NOx into fine particles (PM

2.5

) of ammonium nitrate through atmospheric

chemical processes. PM

2.5

formed in this manner is termed secondary PM

2.5

. Both directly

emitted (primary) PM

2.5

and secondary PM

2.5

from light-duty vehicles are associated with

adverse health outcomes, such as cardiopulmonary mortality, hospitalizations for

cardiovascular illness and respiratory illness, and ER visits for asthma. As a result, reductions

in PM

2.5

and NOx emissions are associated with reductions in these health outcomes.

1. Incidence-Per-Ton Methodology

CARB uses the incidence-per-ton (IPT) methodology to quantify the health benefits of

emission reductions in cases where modeled concentrations are not available. A description

396

See, e.g., CARB 2016. California must also meet its own state ambient air quality standards that are more

stringent than the federal counterparts.

397

EPA 2019. United State Environmental Protection Agency. Integrated Science Assessment for Particulate

Matter (Issue EPA/600/R-19/188). 2019. https://cfpub.epa.gov/ncea/isa/recordisplay.cfm?deid=347534.

398

EPA 2016. United State Environmental Protection Agency. Integrated Science Assessment for Oxides of

Nitrogen – Health Criteria, EPA/600/R-15/068, January 2016. (web link:

http://ofmpub.epa.gov/eims/eimscomm.getfile?p_download_id=526855 )

136

of this method is included on CARB’s webpage.

399

CARB’s IPT methodology is based on a

methodology developed by U.S. EPA.

400, 401, 402

Under the IPT methodology, changes in emissions are approximately proportional to

resulting changes in health outcomes. IPT factors are derived by calculating the number of

health outcomes associated with exposure to PM

2.5

for a baseline scenario using measured

ambient concentrations and dividing by the emissions of PM

2.5

or a precursor. To estimate

the reduction in health outcomes, the emission reductions in each air basin from the

Proposed Regulation in multiplied by the IPT factor. For future years, the number of

outcomes is adjusted to account for population growth. CARB’s current IPT factors are based

on a 2014-2016 baseline scenario, which represents the most recent data available at the

time the current IPT factors were computed. IPT factors are computed for the two types of

2.5

: primary and secondary PM

2.5

emissions of ammonium nitrate aerosols formed from

precursors.

Emission reductions from both vehicle and upstream emissions sources were combined for

health benefit quantification using the IPT method. To estimate the reductions in primary

PM2.5 from non-mobile sources, relative statewide potency factors were applied specifically

to the projected emissions from upstream sources, derived from an analysis of exposures

from multiple sources in California.

309, 403

The health benefits in the next section were

calculated by the five major air basins as well as statewide.

2. Reduction in Adverse Health Impacts

CARB staff evaluated the reduction in adverse health impacts including cardiopulmonary

mortality, hospitalizations for cardiovascular and respiratory illness, and emergency room (ER)

visits for asthma. Staff estimates that the total number of cases statewide, along with the

range in the estimate under a 95 percent confidence interval (CI), that would be reduced

from 2026 to 2040 from implementing the Proposed Regulation are as follows:

• 1,272 cardiopulmonary deaths reduced (994 to 1,555, 95 percent CI);

• 208 hospital admissions for cardiovascular illness reduced (0 to 408, 95 percent CI);

• 249 hospital admissions for respiratory illness reduced (58 to 439, 95 percent CI); and

• 639 emergency room visits for asthma reduced (404 to 875, 95 percent CI).

399

CARB 2022g. California Air Resources Board. CARB’s Methodology for Estimating the Health Effects of Air

Pollution. (web link: https://ww2.arb.ca.gov/resources/documents/carbs-methodology-estimating-health-effects-

air-pollution (Accessed March 18, 2022. https://ww2.arb.ca.gov/resources/documents/carbs-methodology-

estimating-health-effects-air-pollution.

400

Fann et al 2019. Fann N, Fulcher CM, Hubbell BJ., The influence of location, source, and emission type in

estimates of the human health benefits of reducing a ton of air pollution, Air Quality, Atmosphere & Health,

2:169-176, 2019. (web link: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2770129/)

401

Fann et al 2012. Fann N, Baker KR, Fulcher CM., Characterizing the PM2.5-related health benefits of

emission reductions for 17 industrial, area and mobile emission sectors across the U.S. Environ Int.; 49:141-51,

November 15, 2012. (web link: https://www.sciencedirect.com/science/article/pii/S0160412012001985)

402

Fann et al 2018. Fann N, Baker K, Chan E, Eyth A, Macpherson A, Miller E, Snyder J., Assessing Human

Health PM2.5 and Ozone Impacts from U.S. Oil and Natural Gas Sector Emissions in 2025, Environ. Sci. Technol.

52 (15), pp 8095–8103, 2018. (web link: https://pubs.acs.org/doi/abs/10.1021/acs.est.8b02050)

403

Apte 2019.

137

Table VI-1 shows the estimated avoided cardiopulmonary mortality, hospitalizations, and

emergency room visits because of the proposed ACC II regulations for 2026 through 2040,

relative to the baseline. The largest estimated health benefits are expected to occur in the

South Coast, San Francisco Bay, San Diego, San Joaquin Valley, South Central Coast air

basins. These five air basins comprise about 98% of the total health benefits. The benefits for

the other ten air basins are presented as the “Rest of the State”.

Note that because CARB staff are evaluating a limited number of health impacts, the full

health benefits of the Proposed Regulation are expected to be underestimated. An

expansion of the assessment of outcomes, including, but not limited to, reduction of

additional cardiovascular and respiratory illnesses, nonfatal/fatal cancers, and lost workdays

would provide a more complete picture of the benefits from reduced exposure to air

pollution. Additionally, CARB’s mortality and illness assessment is only calculated for a

portion of PM

2.5

emissions, and there are other pollutants that can cause health issues. For

instance, while NOx can lead to the formation of secondary PM

2.5

particles, NOx can also

react with other compounds to form ozone, which can cause respiratory problems. And toxic

air contaminants (TACs) present in emissions can cause cancer and other adverse health

outcomes. Altogether, CARB’s current PM

2.5

mortality and illness evaluation represent only a

portion of the benefits of the proposal.

Lastly, the results presented in Table VI-1 are estimated at a regional scale, at the air basin

level. In addition, it is important to consider that the proposed ACC II regulations may

decrease the exposure to air pollution of those who live and work near roadways as well as

fuel distribution facilities. This is especially important as these individuals are likely at higher

risks of developing cardiovascular and respiratory issues as a result of PM emissions,

compared to those who live farther away from roadways and fuel distribution facilities.

Therefore, although staff cannot quantify the potential effect on near-source exposures, the

proposal is expected to provide significant health benefits for these individuals.

Table VI-1: Avoided Mortality and Morbidity Incidents for the Five Major Air Basins and

Statewide from 2026 to 2040 under the Proposed Regulation*

Air Basin

Avoided

Cardiopulmonary

Deaths

Avoided

Hospitalizations for

Cardiovascular

Illness

Avoided

Hospitalizations for

Respiratory Illness

Avoided ER visits

for Asthma

San Diego County

59 (46 - 73) 8 (0 - 17) 10 (2 - 18) 24 (15 - 33)

San Francisco Bay

182 (142 - 223) 29 (0 - 56) 34 (8 - 60) 99 (63 - 136)

San Joaquin

Valley 40 (31 - 49) 5 (0 - 10) 6 (1 - 10) 15 (9 - 20)

South Central

Coast 16 (12 - 19) 2 (0 - 5) 3 (1 - 5) 7 (4 - 9)

South Coast

962 (752 - 1176) 162 (0 - 318) 194 (45 - 342) 489 (310 - 669)

Rest of the State

13 (10 - 16) 2 (0 - 3) 2 (0 - 4) 5 (3 - 7)

Statewide

1272 (994 - 1555) 208 (0 - 408) 249 (58 - 439) 639 (404 - 875)

*Values in parentheses represent estimates within the 95-percent confidence interval. Totals

may not add due to rounding. Except for the five major air basins, results for the rest of the

138

state are presented at a more regional scale due to the uncertain nature of upstream

emission estimates included in the calculations.

3. Uncertainties Associated with the Mortality and Illness Analysis

Although the estimated health outcomes presented in this report are based on a well-

established methodology, they are subject to uncertainty. Uncertainty is reflected in the 95-

percent confidence intervals included with the central estimates in Table VI-1. These

confidence intervals take into account uncertainties in translating air quality changes into

health outcomes.

Other sources of uncertainty include the following:

• The relationship between changes in pollutant concentrations and changes in pollutant

or precursor emissions is assumed to be proportional, although this is an

approximation.

• Emissions are reported at an air basin resolution, and do not capture local variations,

especially with respect to upstream emission estimates.

• Future population estimates are subject to increasing uncertainty as they are projected

further into the future.

• Baseline incidence rates can experience year-to-year variation.

• Separate policy, regulatory, or industry actions – such as changing import/export

balance decisions at refineries -- could cause different results, though the vast majority

of emission benefits occur from the vehicle emission reductions.

404

4. Monetization of Health Impacts

Consistent with U.S. EPA practice, health outcomes are monetized by multiplying each

incident by a standard value derived from economic studies.

405

The value per incident is

shown in Table VI-2. The value for avoided premature mortality is based on willingness to

pay, which is a statistical construct based on the aggregated dollar amount that a large

group of people would be willing to pay for a reduction in their individual risks of dying in a

year.

406

While the cost-savings associated with premature mortality are important to account

for in the analysis, the valuation of avoided premature mortality does not correspond to

changes in expenditures, and is not included in the macroeconomic modeling. As avoided

hospitalizations and emergency room visits result in reductions in household expenditures on

health care, these values are included in the macroeconomic modeling.

Unlike mortality valuation, the cost-savings for avoided hospitalizations and emergency room

visits are based on a combination of typical costs associated with hospitalization and the

willingness of surveyed individuals to pay to avoid the adverse outcomes that occur when

404

Given the potentially large impacts of this specific regulation upon transportation fuels as a result of its scope

and ambition, an upstream fuels discussion was deemed appropriate in this instance.

405

EPA 2010. United State Environmental Protection Agency., Appendix B: Mortality Risk Valuation Estimates,

Guidelines for Preparing Economic Analyses (240-R-10-001). 2010. Accessed May 2021.

406

EPA 2000. United State Environmental Protection Agency, An SAB Report on EPA’s White Paper Valuing the

Benefits of Fatal Cancer Risk Reduction (EPA-SAB-EEAC-00-013), 2000 (web link:

https://yosemite.epa.gov/sab%5CSABPRODUCT.NSF/41334524148BCCD6852571A700516498/$File/eeacf013.

pdf, accessed May 2021).

139

people are hospitalized. These include hospital charges, post-hospitalization medical care

expenses, out-of-pocket expenses, lost earnings for both individuals and family members,

lost recreation value, and lost household production (e.g., valuation of time lost from the

inability to maintain the household or provide childcare).

407

These monetized benefits from

avoided hospitalizations and ER visits are included in macroeconomic modeling.

Table VI-2: Valuation per Incident for Avoided Health Outcomes

Outcome Value per incident (2020$)

Avoided Premature Mortality

$10,030,076

Avoided Cardiovascular Hospitalizations

$59,247

Avoided Acute Respiratory Hospitalizations $51,678

Avoided Emergency Room Visits $848

Statewide valuations of health benefits were calculated by multiplying the value per incident

by the statewide total number of incidents for 2026-2040. The total statewide health benefits

derived from criteria emissions reductions is estimated to be $14.55 billion, with $14.52

billion resulting from reduced premature cardiopulmonary mortality and $0.03 billion

resulting from reduced hospitalizations and ER visits. The spatial distribution of these benefits

across the state follows the distribution of the health impacts by air basin.

407

Chestnut et al 2006. Chestnut, L. G., Thayer, M. A., Lazo, J. K. and Van Den Eeden, S. K., The Economic

Value Of Preventing Respiratory And Cardiovascular Hospitalizations, Contemporary Economic Policy, 24: 127–

143, 2006. https://onlinelibrary.wiley.com/doi/abs/10.1093/cep/byj007. Accessed May 2021.

140

Table VI-3: Statewide Valuation of Avoided Health Outcomes (million 2020$)

Year

Avoided

Premature

Mortality

Avoided

Cardiovascular

Hospitalizations

Avoided Acute

Respiratory

Hospitalizations

Avoided

ER Visits

Total

Health

Benefit

2026 3 0 1 2 $33.1

2027 9 1 2 5 $87.2

2028 15 2 3 8 $155.6

2029 24 4 4 12 $238.1

2030 34 5 6 17 $338.3

2031 46 7 9 23 $458.2

2032 59 9 11 30 $593.1

2033 74 12 14 38 $743.0

2034 91 15 18 46 $910.0

2035 108 18 21 55 $1,089.0

2036 126 21 25 64 $1,270.7

2037 144 24 29 72 $1,450.2

2038 162 27 32 81 $1,630.1

2039 180 30 36 89 $1,805.8

2040 197 33 39 97 $1,977.8

Total 1,272 208 249 639 $12,780.2

141

C. Greenhouse Gas Reduction Benefits - Social Cost of Carbon

Table VII-1 summarizes the estimated total upstream and downstream (or well-to-wheel,

WTW

408

) GHG emissions from the proposed regulation, in units of MMT of CO

per year.

Staff expects the proposed regulation to reduce cumulative WTW GHG emissions by an

estimated 383.5 MMT of CO

relative to the baseline from 2026 to 2040.

These expected reductions will come from replacing ICEVs with ZEV technologies. The

benefit of these GHG emission reductions can be estimated using the social cost of carbon

(SC-CO

), which provides a dollar valuation of the damages caused by one ton of carbon

pollution and represents the monetary benefit today of avoiding those future damages by

reducing future carbon emissions.

In the analysis of the SC-CO

for the proposed regulation, CARB utilizes the current

Interagency Working Group (IWG)-supported SC-CO

values to consider the social costs of

actions taken to reduce GHG emissions. This is consistent with the approach presented in the

Revised 2017 Climate Change Scoping Plan, is in line with U.S. Government Executive Orders

including 13990 and the Office of Management and Budget’s Circular A-4 of September 17,

2003, and reflects the best available science in the estimation of the socio-economic impacts

of carbon.

409,410

IWG describes the social costs of carbon as follows:

The SC-CO

for a given year is an estimate, in dollars, of the present discounted value

of the future damage caused by a 1-metric ton increase in CO

emissions into the

atmosphere in that year or, equivalently, the benefits of reducing CO

emissions by

the same amount in that year. The SC-CO

is intended to provide a comprehensive

measure of the net damages – that is, the monetized value of the net impacts from

global climate change that result from an additional ton of CO

Those damages include, but are not limited to, changes in net agricultural

productivity, energy use, human health, property damage from increased flood risk, as

well as nonmarket damages, such as the services that natural ecosystems provide to

society. Many of these damages from CO

emissions today will affect economic

outcomes throughout the next several centuries.

411

The SC-CO

is year-specific and is highly sensitive to the discount rate used to discount the

value of the damages in the future due to CO

. The SC-CO

increases over time as systems

become more stressed from the aggregate impacts of climate change and as future

emissions cause incrementally larger damages. This discount rate accounts for the preference

for current costs and benefits over future costs and benefits, and a higher discount rate

decreases the value today of future environmental damages. While the proposed regulation

408

Upstream emissions are also referred to as well-to-tank (WTT) and downstream emissions are also referred to

as tank-to-wheel (TTW).

409

CARB 2017c.

410

OMB 2003. Office of Management and Budgets, Circular A-4, 2003 (web link:

https://www.transportation.gov/sites/dot.gov/files/docs/OMB%20Circular%20No.%20A-4.pdf, accessed May

2021).

411

NAS 2017. National Academies of Sciences, Engineering, Medicine, Valuing Climate Damages: Updating

Estimation of Carbon Dioxide, 2017 (web link: http://www.nap.edu/24651, accessed May 2021).

142

cost analysis does not account for any discount rate, this social cost analysis uses the IWG

standardized range of discount rates from 2.5 to 5-percent to represent varying valuation of

future damages. Table IV-4 shows the range of IWG SC-CO

discount rates used in

California’s regulatory assessments, which reflect the societal value of reducing carbon

emissions by one metric ton.

412

Table VI-4: SC-CO

by Discount Rate (in 2020$ per Metric Ton of CO

)

Year 5% Discount Rate 3% Discount Rate 2.5% Discount Rate

2020 $16 $55 $81

2025 $21 $66 $96

2030 $21 $66 $96

2035 $24 $72 $102

2040 $28 $79 $110

The avoided SC-CO

from 2026 to 2040 is the sum of the annual WTT and TTW GHG

emissions reductions multiplied by the SC-CO

in each year. The cumulative WTW GHG

emissions reductions along with the estimated benefits from the proposed regulation are

shown in Table VI-5. These benefits range from about $9.5 billion to $40.1 billion

through 2040, depending on the chosen discount rate.

Table VI-5: Avoided Social Cost of Carbon for the Proposed Regulation

Year

GHG Emission

Reductions

(MMT)

Avoided SC-CO2

(Million 2020$)

5% Discount Rate

Avoided SC-CO2

(Million 2020$)

3% Discount Rate

Avoided SC-CO2

(Million 2020$)

2.5% Discount Rate

2026 0.9 $17 $56 $81

2027 2.6 $51 $164 $239

2028 4.7 $93 $302 $438

2029 7.2 $142 $463 $680

412

White House 2021d. Interagency Working Group on the Social Cost of Carbon, Technical Update of the

Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 13990, 2021 (web link:

https://www.whitehouse.gov/wp-

content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf, last

accessed May 2021).

143

2030 10.3 $216 $676 $987

2031 14.0 $294 $937 $1,359

2032 18.2 $406 $1,242 $1,791

2033 22.7 $506 $1,579 $2,264

2034 27.9 $659 $1,977 $2,819

2035 33.4 $789 $2,411 $3,419

2036 38.7 $965 $2,844 $4,012

2037 43.8 $1,092 $3,276 $4,656

2038 48.6 $1,276 $3,699 $5,230

2039 53.1 $1,394 $4,111 $5,783

2040 57.4 $1,582 $4,519 $6,327

Total 383.5 $9,480 $28,255 $40,085

D. Benefits to Manufacturers Making ZEVs

Typical businesses that may directly benefit from the proposed amendments are

manufacturers that already have ZEV offerings in the market today and have made

investments in ZEVs. Due to higher demand for ZEVs from the Proposed Regulation,

production of ZEVs by businesses in California would likely increase, leading to increases in

manufacturing and related jobs with manufacturers that specifically produce ZEVs.

Additionally, ZEV-only manufacturers, such as Tesla, Rivian, and Lucid, benefit from

generating additional ZEV credits through their overcompliance and selling of credits to

other manufacturers. Other ZEV-only start-ups in California, such as Canoo, Karma

Automotive, and Faraday Future, can also benefit from the trading of ZEV credits.

E. Benefits to Individuals – Total Cost of Ownership

The Proposed Regulation would benefit individual vehicle owners that are California

residents. Ownership and operational costs are combined with the incremental vehicle prices

to estimate the total cost of ownership (TCO) during the period of the regulation.

Staff analyzed the costs of BEVs, PHEVs, and FCEVs over a 10-year period. The results show

that for BEVs, operational savings will offset any incremental costs over the 10-year period

evaluated. For example, a passenger car BEV with a 300-mile range will have initial annual

144

savings occur in the first year for the 2026 model year technology. For the 2035 model year

technology, the initial savings are nearly immediate and cumulative savings over ten years

exceed $7,500. The resulting trends are different for the FCEV and PHEV technologies. In

most of the model years, neither of these technologies will have net savings within the ten-

year period. The examples also both use a single-family home type, but that assumption only

affects the initial cost of a home charger and receptacle.

The differences in TCO are based on several factors. First, TCO results vary dramatically for a

vehicle sold at the beginning of the regulation period (2026) as compared to the end of the

regulation period (2035), primarily because the vehicle incremental price is substantially lower

in the later years as the technology continues to mature and costs continue to decline.

Second, in both examples, results for a BEV driver are shown both for someone with a home

charger and someone without a home charger. For someone with a home charger, they incur

an additional capital cost of installing a home charger and receptacle, yet they have lower

fuel costs given the cheaper retail price of residential electricity, as described in the

appendix. The result of this tradeoff are slight differences in the 10-year TCO savings, but in

both cases the payback period is a year or less. The 10-year TCO full cost savings are slightly

larger for the individual with a home charger in both model year examples.

These results are shown in Table VI6 for 2026MY vehicles, and in Table VII-7 for 2035MY

vehicles.

Table VI-6: Total cost of ownership over 10 years for individual ZEV and PHEV buyer

compared to baseline ICEV, 2026 MY Passenger Car (PC) in Single-Family Home (SFH) *

BEV (300-mile range)

FCEV

PHEV

With home

charger

No home

charger

With home

charger

Incremental vehicle

price

$ 3,102

$ 10,448

$ 4,681

Home Level 2 circuit

(not including the

charger)

$ 680

Finance costs & sales

tax (for incr veh price

and Level 2 circuit)

$ 798

$ 655

$ 2,205

$ 1,131

Incremental Fuel

costs

$ (5,068)

$ (3,306)

$ 8,670

$ (649)

Incremental

Maintenance costs

$ (4,540)

$ (1,249)

Incremental

Insurance

$ 631

$ 2,124

$ 952

Incremental

Registration

$ 758

$ 952

$ 800

Total (10 years)

$ (4,267)

$ (3,216)

$ 21,416

$ 5,456

Initial annual

savings

1 year

>10 years

*Finance costs include a 5-year loan at 5-percent interest; operation and ownership costs over 10

years (~150,000 miles) shown as net present value for 2026 at a discount rate of 10-percent.

145

Table VI-7: Total cost of ownership over 10 years for individual ZEV and PHEV buyer

compared to baseline ICEV, 2035 MY Passenger Car (PC) in Single-Family Home (SFH) *

BEV (300-mile range)

FCEV

PHEV

With home

charger

No home

charger

With home

charger

Incremental vehicle

price

$ (538)

$ 1,785

$ 3,051

Home Level 2 circuit

(not including the

charger)

$ 680

Finance costs & sales

tax (for incr veh price

and Level 2 circuit)

$ 30

$ (114)

$ 377

$ 787

Incremental Fuel costs

$ (5,047)

$ (3,160)

$ 669

$ (763)

Incremental

Maintenance costs

$ (4,489)

$ (1,234)

Incremental Insurance

$ (109)

$ 363

$ 620

Incremental

Registration

$ 662

$ 723

$ 803

Total (10 years)

$ (8,835)

$ (7,659)

$ 2,386

$ 3,324

Initial annual savings

<1 year

>10 years

*Finance costs include a 5-year loan at 5-percent interest; operation and ownership costs over 10

years (~150,000 miles) shown as net present value for 2035 at a discount rate of 10 percent

VII. Air Quality – Emission Benefits

This chapter includes an analysis of air quality data and emissions reductions relevant to the

proposed regulation or amendments. This analysis provides support for air quality discussions

in chapters II, III, and IV, and will provide more detailed information in support of the air

quality summaries in chapters V and VII.

F. Baseline Assumptions

The emission benefits of the proposed ACC II regulation for LDVs and MDVs are estimated

using CARB’s latest version of its on-road vehicle emission inventory tool EMFAC2021

413

and

CARB’s Vision model, which can be used to quantify upstream emissions from the

transportation fuel and electric power industries.

414

Light-duty vehicles are vehicles with a

gross vehicle weight rating (GVWR) less than 8,500 pounds, which includes passenger cars

(LDA) and light-duty trucks (LDT1, LDT2, and LDT3). Medium-duty vehicles are vehicles with a

GVWR greater that 8,500 pounds and less than 14,000 pounds, which include light-heavy-

413

CARB 2021g. California Air Resources Board. EMFAC 2021 Volume III Technical Document. Published April

2021. Accessed March 10, 2022. https://ww2.arb.ca.gov/sites/default/files/2021-

08/emfac2021_technical_documentation_april2021.pdf.

414

233. CARB 2017j. California Air Resources Board. Vision 2.1 Scenario Modeling System Limited Scope

Release. Published February 2017. Accessed March 10, 2022. https://ww2.arb.ca.gov/sites/default/files/2020-

06/vision2.1_scenario_modeling_system_general_documentation.pdf.

146

duty trucks. EMFAC2021 reflects California-specific driving and environmental conditions,

passenger vehicle fleet mix, and most importantly the impact of California’s unique mobile

source regulations. These include all currently adopted regulations such as the LEV, LEV II

and LEV III programs, the existing ZEV regulation, and California inspection and maintenance

programs. The EMFAC2021 model is based on CARB’s ACC regulations but also considers

updated California Department of Motor Vehicles data through calendar year 2019 and

improved projections of ZEV sales to forecast future ZEV populations, which show

overcompliance with the current ZEV requirements in the ACC regulations. It should be

noted that the current model is only capable of representing business-as-usual conditions

and is made using the best available data, and factors such as COVID-19 introduce both

short- and long-range uncertainties in the ability of the model to accurately forecast future

trends.

To assess the impact of the proposed regulation, the EMFAC2021 model with customized

“annual average” settings was run to estimate statewide light-duty vehicle emissions by

calendar year, vehicle category, fuel type, and model year projected to occur for the years of

2026 through 2050. The default number of ZEVs in the EMFAC2021 fleet was also adjusted

to account for recent changes to the U.S. EPA vehicle standards up to model year 2026. This

is described in further detail in later sections.

G. Total Emission Benefits

The combined emission benefits associated with upstream fuel production and vehicle

emissions (i.e., well-to-wheel) are summarized in the table below. Given the potentially large

impacts of this specific regulation upon transportation fuels as a result of its scope and

ambition, an upstream fuels discussion was deemed appropriate in this instance and is

provided here with appropriate caveats and transparency as to its assumptions. In particular,

separate policy, regulatory, or industry actions – such as changing import/export balance

decisions at refineries -- could cause different results. A complete policy portfolio of both

technology and upstream regulations will affect the ultimate outcome. This analysis reflects

one reasonable scenario.

The upstream, or well-to-tank (WTT), emissions, were quantified via the same approach used

in the 2020 Mobile Source Strategy

415

with updated assumptions for fuel and energy supply.

WTT emissions include sources from fuel production facilities such as electricity power plants,

hydrogen, biofuel production, and gasoline refineries, in addition to fuel feedstock collection

(e.g. crude oil extraction from in-state wells) and finished fuel product transportation and

distribution. The WTT emission factors capture criteria emissions emitted in California and

GHG emissions within the scope of AB 32. WTT emission factors for gasoline, diesel, and

hydrogen fuels were developed based on California-specific data, including Low Carbon Fuel

415

CARB 2021a.

147

Standard (LCFS) data

416

, CEIDARS/CEPAM

417

, and CA-GREET

418

, while considering LCFS

compliance scenarios and SB 1505

419

. Electricity emission factors reflect compliance with

SB 100 Renewable Portfolio Standard targets

420

Details of this analysis are provided in Appendix D.

Table VII-1:Total Upstream Fuel Production and Vehicle Emission Benefits of the

Proposed Regulation (emission reductions from the baseline)

Calendar

Year

NOx (tpd)

PM2.5 (tpd)

CO2

(MMT/yr)

2026

0.6

0.0

0.9

2027

1.5

0.1

2.6

2028

2.6

0.1

4.7

2029

4.0

0.2

7.2

2030

5.6

0.3

10.3

2031

7.5

0.4

14.0

2032

9.5

0.6

18.2

2033

11.8

0.7

22.7

2034

14.4

0.9

27.9

2035

17.0

1.1

33.4

2036

19.7

1.3

38.7

2037

22.4

1.5

43.8

2038

25.0

1.6

48.6

2039

27.6

1.8

53.1

2040

30.1

2.0

57.4

416

Data includes crude supply, carbon intensity, and in-state production from LCFS data dashboard and LCFS

compliance scenario, refer to:

CARB 2021h. California Air Resources Board. LCFS Data Dashboard, Last Reviewed October 29, 2021

https://ww3.arb.ca.gov/fuels/lcfs/dashboard/dashboard.htm

CARB 2018c. California Air Resources Board. LCFS Illustrative Compliance Scenarios

https://www.arb.ca.gov/fuels/lcfs/2018-

0815_illustrative_compliance_scenario_calc.xlsx?_ga=2.155021808.917945968.1597354480-

1389483658.1577128071

417

CARB 2018d. Criteria Pollutant Emission Inventory Data. (web link:

https://ww2.arb.ca.gov/criteria-pollutant-emission-inventory-data)

418

CARB 2019d. CA-GREET3.0 Model. https://www.arb.ca.gov/fuels/lcfs/ca-greet/ca-greet30-

corrected.xlsm?_ga=2.247817287.1944131420.1600710547-1389483658.1577128071

419

SB 1505 requires at least 33.3 percent of the hydrogen dispensed by fueling stations that receive state funds

be made from eligible renewable energy resources, refer to:

https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=200520060SB1505

Based on current hydrogen supply from LCFS reporting data and future production investments, the supply of

renewable hydrogen can be, at least, maintained at 40% of hydrogen fuel demand.

420

SB 100 requires renewable energy and zero-carbon resources supply 100

percent of electric retail sales to end-use customers by 2045. For renewable source targets in

2030 and 2045, refer to following link. The renewable mix was assumed to scale linearly between 2030 and

2045. https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB100

148

VIII. Environmental Analysis

CARB is the lead agency for the proposed regulation and has prepared an environmental

analysis (EA) pursuant to its certified regulatory program (title 17, CCR, sections 60000

through 60008) to comply with the requirements of the California Environmental Quality Act

(CEQA). CARB’s regulatory program, which involves the adoption, approval, amendment, or

repeal of standards, rules, regulations, or plans for the protection and enhancement of the

State’s ambient air quality has been certified by the California Secretary for Natural

Resources under Public Resources Code section 21080.5 of CEQA (title 14, CCR,

section 15251(d)). Public Resources Code section 21080.5 allows public agencies with

certified regulatory programs to prepare a “functionally equivalent” or substitute document

in lieu of an environmental impact report or negative declaration, once the program has been

certified by the Secretary for the Resources Agency as meeting the requirements of CEQA.

CARB, as a lead agency, prepares a substitute environmental document (referred to as an

“Environmental Analysis” or “EA”) as part of the Staff Report to comply with CEQA (title 17,

CCR, section 60005).

The Draft Environmental Analysis (Draft EA) for the proposed regulation is included in

Appendix D. The Draft EA provides a programmatic environmental analysis of an illustrative,

reasonably foreseeable compliance scenario that could result from implementation of the

proposed regulation. The Draft EA states that implementation of the proposed regulation

could result in beneficial impacts to PM, NOx, and GHGs through substantial reductions in

emissions from light- and medium-duty vehicles in California.

For the purpose of determining whether the proposed regulation will have a potential

adverse effect on the environment, CARB evaluated the potential physical changes to the

environment resulting from a reasonable, foreseeable compliance scenario. Implementation

of the proposed regulation could result in certain impacts, including, but not limited to: the

construction and operation of new or expanded manufacturing facilities for ZEV

technologies; the construction of supporting infrastructure, such as electric chargers and

hydrogen fueling stations; increased demand for electricity and hydrogen fuel and therefore

more electricity and hydrogen generation and distribution; the displacement of fossil fuel

extraction, refinement, manufacture, distribution, and combustion; new or modified recycling

or refurbishment facilities to accommodate battery and fuel cell refurbishment, reuse, and

disposal; and increased demand for the extraction of raw minerals used in the production of

batteries and fuel cells, such as lithium and platinum from source countries and states.

While many impacts associated with the compliance responses identified for the proposed

regulation could be reduced to less-than-significant levels through conditions of approval

applied and mitigation measures to project-specific development, the authority to apply that

mitigation lies with land use agencies or other agencies approving the development projects,

not with CARB. Consequently, the EA takes a conservative approach in its significance

conclusions and discloses for CEQA compliance purposes, that impacts from the

development of new facilities, charging infrastructure and fueling stations associated with

reasonably foreseeable compliance responses to the proposed regulation, could be

potentially significant and unavoidable. Table VIII-1 summarizes the potential environmental

impacts of the proposed regulation.

149

Table VIII-1: Significance of Potential Environmental Impacts and Numbered Sections

within Appendix D.

Resource Area Impact Significance

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Aesthetics

Potentially Significant

and Unavoidable

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Agriculture and Forest Resources

Potentially Significant

and Unavoidable

-1

Short

-Term Construction-Related Effects to Air Quality

Potentially Significant

and Unavoidable

-2

Long

-Term Operation-Related Effects to Air Quality

Beneficial

-1

Short-Term Construction-Related Effects to Biological

Resources

Potentially Significant

and Unavoidable

-2

Long

-Term Operation-Related Effects to Biological Resources

Potentially Significant

and Unavoidable

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Cultural Resources

Potentially Significant

and Unavoidable

-1

Short

-Term Construction-Related Effects to Energy Demand

Less than Significant

-2

Long

-Term Operation-Related Effects to Energy Demand

Less than Significant

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Geology, Seismicity, and Soils

Potentially Significant

and Unavoidable

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Greenhouse Gas Emissions and Cl

imate

Change

Beneficial

-1

Short-Term Construction-Related Effects to Hazards and

Hazardous Materials

Potentially Significant

and Unavoidable

-2

Long-Term Operation-Related Effects to Hazards and

Hazardous Materials

Potentially Significant

and Unavoidable

-1

Short-Term Construction-Related Effects to Hydrology and

Water Quality

Potentially Significant

and Unavoidable

-2

Long-Term Operation-Related Effects to Hydrology and Water

Quality

Potentially Significant

and Unavoidable

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Land Use and Planning

Less than Significant

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Mineral Resources

Less than Significant

3-1

Short-Term Construction-Related Effects to Noise and

Vibration

Potentially Significant

and Unavoidable

-2

Long

-Term Operation-Related Effects to Noise and Vibration

Potentially Significant

and Unavoidable

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Population and Housing

Less than Significant

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Public Services

Less than Significant

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Recreation

Less t

han Significant

150

-1

Short-Term Construction-Related Effects to Transportation

and Traffic

Potentially Significant

and Unavoidable

-2

Long-Term Operation-Related Effects to Transportation and

Traffic

Potentially Significant

and Unavoidable

-1

Short

-Term Construction-Related and Long-Term Operation-

Related Effects to Tribal Cultural Resources

Potentially Significant

and Unavoidable

-1

Long Operational Impacts

to Utilities and Service Systems

Potentially Significant

and Unavoidable

-1

Short-Term Construction-Related and Long-Term Operation-

Related Effects to Wildfire

Less than Significant

Written comments on the Draft EA will be accepted starting April 15, 2022 through May 31,

2022. The Board will consider the Final EA and responses to comments received on the Draft

EA before taking action to adopt the proposed regulation. The full Draft EA can be found in

Appendix D. If comments received during the public review period raise significant

environmental issues, staff will summarize and respond to the comments. The written

responses to environmental comments will be approved prior to final action on the proposed

regulation (Title 17, CCR § 60004.2(b)). If the proposed regulation is adopted, a Notice of

Decision will be posted on CARB’s website and filed with the Secretary of the Natural

Resources Agency for public inspection (Title 17, CCR § 60004.2(d)).

IX. Environmental Justice

State law defines environmental justice as the fair treatment and meaningful involvement of

people of all races, cultures, incomes, and national origins, with respect to the development,

adoption, implementation, and enforcement of environmental laws, regulations, and policies

(Gov. Code, § 65040.12, subd. (e)(1)). Environmental justice includes, but is not limited to, all

of the following: (A) The availability of a healthy environment for all people; (B) The

deterrence, reduction, and elimination of pollution burdens for populations and communities

experiencing the adverse effects of that pollution, so that the effects of the pollution are not

disproportionately borne by those populations and communities; (C) Governmental entities

engaging and providing technical assistance to populations and communities most impacted

by pollution to promote their meaningful participation in all phases of the environmental and

land use decision making process; and (D) At a minimum, the meaningful consideration of

recommendations from populations and communities most impacted by pollution into

environmental and land use decisions (Gov. Code, § 65040.12, subd. (e)(2)). The Board

approved its Environmental Justice Policies and Actions (Policies) on December 13, 2001, to

establish a framework for incorporating environmental justice into CARB's programs

consistent with the directives of State law. These policies apply to all communities in

California, but are intended to address the disproportionate environmental exposure burden

borne by low-income communities and communities of color. Environmental justice is one of

CARB’s core values and fundamental to achieving its mission.

A core environmental justice goal of the ACC II rulemaking development was to increase

community engagement to ensure that the Advanced Clean Cars II regulations and other

supportive programs are aligned with community needs. Through this increased

engagement, staff sought to better understand of the impacts of passenger cars in our

communities, while simultaneously broadening the conversation beyond established CARB

151

partners to include voices that have been historically marginalized, such as our underserved

communities, rural communities, and tribal communities. As part of this engagement, staff

also informed communities about the future of electric transportation and what is being done

to make ZEV technologies more accessible. For example, staff conducted a transportation

equity community listening session and participated in existing local community and

environmental justice coalition meetings to discuss the ACC II rulemaking. In developing the

regulatory proposals and analysis, staff have met with more than 20 national, state, and local

advocacy organizations to learn more about the recommendations these groups may have

regarding staff’s proposals and how transportation electrification could be made more

equitable. Staff’s approach to environmental justice and equity in ACC II is multi-faceted and

draws on these recommendations and staff’s own analysis.

As of February 2022, staff have conducted 36 meetings with the public, environmental justice

(EJ) advocates, and community-based organizations. Meeting formats included public

workshops, community meetings, informal meetings, and phone calls. Due to the COVID-19

pandemic, these meetings were all held virtually. At these meetings, staff discussed draft

concepts and solicited input from affected stakeholders on the ACC II regulations. Table IX-1

below provides a list of the environmental justice/community focused workshops and

meetings conducted during the development process for the proposed regulations.

Table IX-1. List of Public Workshops, Listening Sessions, and Meetings with EJ Advocates

and Community Organizations

Date Primary Meeting Attendees Type of Meeting

September 16, 2020

Public/Stakeholders

Public Workshop

Jan

uary 22, 2021

Charge Ahead Coalition (Greenlining, Communities for a

Better Environment, EarthJustice, Better World Group)

EJ Meeting

April 6, 2021

NGO Coalition

EJ Meeting

April 26, 2021

Charge Ahead Coalition

EJ Meeting

May 3, 2021

Environmental Justice Advisory Committee

(

Physicians for Social Responsibility, Comite Civico

del Valle, Reclaim Our Power)

EJ Meeting

May 6, 2021

Public/Stakeholders

Public Workshop

May 12, 2021

Los Angeles Physicians for Social Responsibility

EJ Meeting

May 17, 2021

Charge Ahead Coalition

EJ Meeting

June 7, 2021

Charge Ahead Coalition

EJ Meeting

June 28, 2021

Charge Ahead Coalition

EJ Meeting

June 29, 2021

Public/Stakeholders/EJ Community

Listening Session

July 20, 2021

Sacramento PEV Collaborative

EJ Meeting

July 26, 2021

Charge Ahead Coalition

EJ Meeting

August 11, 2021

Public/Stakeholders

Public Workshop

August 27, 2021

American Lung Association

EJ Meeting

August 30, 2021

Charge Ahead Coalition

EJ Meeting

September 9, 2021

Central Valley Air Quality Coalition (CVAQ)

EJ Meeting

September 13, 2021

Charge Ahead Coalition

EJ Meeting

September 20, 2021

Charge Ahead Coalition

EJ Meeting

September 28, 2021

Prove It Campaign

EJ Meeting

September 30, 2021

Center for Energy Efficiency and Renewable

Technologies

EJ Meeting

October 1, 2021

Center for Sustainable Energy

EJ Meeting

152

October 4, 2021

Charge Ahead Coalition

EJ Meeting

October 13, 2021

Regional Asthma Management and Prevention (RAMP)

EJ Community

Meeting

October 13, 2021

Public/Stakeholders

Public Workshop

October 19, 2021

San Diego Quality of Life Transportation Subgroup

EJ Community

Meeting

October 28, 2021

Climate Resolve

EJ Meeting

November 3, 2021

Access Clean California Outreach Partners (GRID

Alternatives, Greenlining,

Native American

Environmental Protection Coalition (NAEPC)

, Blue Lake

Rancheria

, Liberty Hill, SEIU California, Latino/a

Roundtable

, Fresno Metro Black Chamber of Commerce

etc.)

EJ Meeting

November 8, 2021

Charge Ahead Coalition

EJ Meeting

November 12, 2021

Brightline Defense

EJ Meeting

December 6, 2021

Bay Area Air Quality Management District

Meeting

December 10, 2021

South Coast Air Quality Management District

Meeting

December 13, 2021

Charge Ahead Coalition

EJ Meeting

December 14, 2021

San Joaquin Valley Air Pollution Control District

Meeting

January 12, 2022

Central Valley Asthma Collaborative

EJ Meeting

January 24, 2022

Charge Ahead Coalition

EJ Meeting

Based on engagement with community members, EJ advocates, and community-based

organizations, staff received feedback on ways in which automakers could best help increase

access to electric vehicles. First and foremost, staff heard that automakers should increase

production of electric vehicles and that automakers should produce electric cars with more

range. Under the ACC II ZEV regulation proposals, automakers will need to increase

production of electric vehicles to ultimately reach 100 percent of new vehicles sales being

electric by 2035. Staff are also proposing new minimum requirements for ZEVs receiving

regulatory credit that helps address the concern of vehicle range. Staff also heard that ZEV

affordability is a concern. This concern has also been reiterated by EJ advocates who also

would like to see increase of ZEV ownership of new and/or used ZEVs by community

members and an increase in ZEV mobility access to meet day-to-day transportation needs.

Based on this feedback, staff developed the EJ allowances discussed in Section III.C.4.

As previously noted, the impacts of climate change and air pollution affect all Californians,

but residents in disadvantaged and low-income communities are especially vulnerable and

often face the most severe impacts. By increasing the number of ZEVs on the road and

continuing to clean up conventional internal combustion vehicles, the ACC II regulatory

proposals will reduce exposure to vehicle pollution in communities throughout California,

including in frontline communities that are disproportionately exposed to vehicular pollution.

The ACC II program is anticipated to reduce emissions in the passenger vehicle fleet by

47,178 tons of reactive organic gases, 57,244 tons of oxides of nitrogen, and 3,071 tons of

particulate matter (PM

2.5

) cumulatively by 2040. Staff expects the ACC II proposals to also

reduce cumulative vehicle greenhouse gas emissions by an estimated 374 million metric tons

of carbon dioxide from 2026 to 2040. The NOx emission benefits, particularly, from cleaner

light duty vehicles is important to mitigate regional ozone formation in the South Coast and

San Joaquin Valley air basins, and the lower-income communities that reside in higher ozone

concentration areas.

153

As noted in section VI.B.2, the proposed ACC II regulations may decrease the exposure to air

pollution of those who live and work near roadways as well as fuel distribution facilities. This

is especially important as these individuals are likely at higher risks of developing

cardiovascular and respiratory issues because of PM emissions, compared to those who live

farther away from roadways and fuel distribution facilities.

421

Although staff cannot quantify

the potential effect on near-source exposures, the proposal is expected to provide significant

health benefits for these individuals. Further, long-term studies have shown that prior LEV

standards reduced the degradation with age of conventional vehicle emission control

systems. This reduces the disproportionate impacts of emissions between newer and used

vehicles and the households that own them such that used vehicles more commonly owned

by lower-income households in environmental justice communities have become increasingly

cleaner relative to new vehicles.

422

In addition to driving the sales of ZEVs, CARB staff are also proposing requirements called

ZEV assurance measures, including minimum warranty and durability standards. These

standards are designed to ensure that as ZEVs age, they continue to serve as full

replacement vehicles for conventional vehicles in every household in California. CARB has

long designed its regulations and certification systems to ensure that vehicles, including their

emissions controls, perform properly throughout their life. In the ZEV context, the vehicle

itself is reducing emissions by displacing an internal combustion engine vehicle. If the ZEV

does not perform as expected, a driver may replace it with a conventional vehicle that has

emissions, therefore reducing or negating the emission benefits of the regulations. This

concern intensifies as ZEVs age and enter the used vehicle market.

Used cars account for the majority of annual car purchases in California and cost significantly

less to purchase than new cars, making durable used ZEVs especially important as affordable

transportation options for many Californians. By establishing minimum requirements for the

performance of ZEVs, the ZEV assurance measures help support access to reliable ZEVs for

those that may not be buying new vehicles, but for whom reliable and durable mobility

options are especially important. If battery failures occur, the proposal to require battery

state of health data are intended to make servicing the batteries cheaper with less service

diagnostics needed and replacing only portions of the battery in some instances.

ZEVs can also be cheaper to own and maintain than conventional vehicles, reducing

transportation costs that comprise a disproportionate share of spending for lower-income

Californians. Additional ZEV assurance and technical requirements enhance the likelihood

that ZEVs will be more affordable, making them more likely to be used in place of

conventional vehicles and thus reducing emissions. This includes a required convenience cord

from automakers that can reduce the cost for home charging access, as well as a

standardized fast charge port that will make charging infrastructure investments more

efficient, which may lead to lower public charging costs.

421

UCLA 2018. Carlson. 2018. “The Clean Air Act’s Blind Spot: Microclimates and Hotspot Pollution.” 65 UCLA

L. Rev. 1036. Accessed March 7, 2022. https://www.uclalawreview.org/wp-content/uploads/2019/09/65.5.1-

Carlson.pdf.

422

Park et al 2016. Park, Seong Suk, Abhilash Vijayan, Steve L. Mara and Jorn D. Herner. 2016. Investigating the

real-world emission characteristics of light-duty gasoline vehicles and their relationship to local socioeconomic

conditions in three communities in Los Angeles, California. Journal of the Air & Waste Management Association,

66:10, 1031-1044, DOI:10.1080/10962247.2016.1197166.

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Figures 28 and 29 below show that annual costs of ownership for a BEV 300-mile passenger

car are less expensive than the conventional vehicle in all ten years of ownership studied, and

for the range of model years studied. Specifically, for both the 2026MY and 2035MY BEV300,

the annual fuel and maintenance savings offset the annual loan costs of the vehicle purchase,

even when accounting for higher electricity prices with a driver that solely relies on public

charging prices.

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As discussed further below, this regulation seeks to work in tandem with

incentives and other programs to advance access to ZEVs by lower-income Californians. For

further details of the costs in these figures, refer to the BEV300 without a home charger in

Table VI-6 and Table VI-7.

Figure 28: Annual costs (and savings) over a ten-year ownership for a 2026MY BEV300

passenger car with no home charging access

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Note these trends are not observed with the PHEV and FCEV passenger vehicles evaluated.

155

Figure 29: Annual costs (and savings) over a ten-year ownership for a 2035MY BEV300

passenger car with no home charging access

Additionally, staff are proposing regulatory incentives for automakers that take action to help

improve environmental justice outcomes as described in section III.C.5. These actions include

providing ZEVs and PHEVs at a discount to community clean mobility programs; retaining

used ZEVs after leases in the California market for low-income vehicle purchasing and finance

assistance programs (such as Clean Cars 4 All); and offering lower-priced new ZEVs to the

market. These optional provisions will help increase affordable access to ZEVs, particularly in

environmental justice communities in California.

CARB staff are aware that more must be done to ensure environmental justice communities

benefit equitably from the transition to 100-percent electrification of new vehicle sales. In

addition to the ACC II regulations, statewide actions can include significant increases in

funding for targeted incentives and infrastructure development, as well as more directed

equity actions from private industry. Further, it is important that as CARB and State actors

consider ways to protect public health, the lens for transportation equity extends beyond

cars to embrace policies and tools that reduce the need for personal vehicles, such as

walkable communities, active transportation, and public transit as well. Thus, while

manufacturer regulations, such as ACC II, can do much to ensure personal vehicles, new and

used, are widely used, durable, and available, other tools are also important to advance

environmental justice in California.

X. Standardized Regulatory Impact Analysis

A Standardized Regulatory Impact Analysis (SRIA) was developed for this proposed

regulation and released on February 1, 2022, after submission to the Department of Finance.

The proposed regulation and a number of the cost assumptions have been updated since the

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SRIA was submitted to the Department of Finance. This chapter provides the updated

assumptions and the economic and health impacts of the revised targets.

Similar to the emissions impact analysis in Chapter VI, the economic impacts of the Proposed

Amendments are evaluated against the baseline scenario for the analysis period from 2026

through 2050. As previously stated in Chapter VI, the baseline vehicle inventory includes the

vehicle sales and population growth assumptions currently reflected in CARB’s EMFAC2021

emissions inventory model, but with adjustments in areas such as the ZEV baseline

population projections, as described below.

A. Changes since the release of the SRIA

Staff’s proposal and economic impact analysis has evolved in a number of ways since the

SRIA was posted on February 1, 2022, as described further below. (The SRIA is attached as

Appendix C-1 and also is available on the California Department of Finance’s website.

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)

1. Updated Technology Package Cost

For the SRIA, CARB staff assessed ZEV technologies available on the market today and

estimated expected technical advancements in the time frame of the regulation to develop

vehicle efficiencies, electric motor power, and other attributes to assign costs to each

technology package. After finalizing costs for the SRIA, CARB staff continued to work closely

with stakeholders to refine costs and compliance scenarios. The changes from the SRIA are

presented in this section.

First, stakeholders requested that CARB review its ZEV attributes and cost data and take into

account new data from ANL’s 2021 Light Duty Vehicle Technology report,

425

which was

released after the SRIA analysis had been completed. The 2021 ANL report contains the

most up-to-date modeling information from U.S. DOE and ANL which better represents BEV,

PHEV, and FCEV attributes than previous reports and provides a consistent comparison of

attributes between ZEV types. In the SRIA, where existing models (BEV and PHEV) were not

available in a vehicle class, the National Renewable Energy Laboratory’s (NREL) Future

Automotive Systems Technology Simulator (FastSim) tool was used to convert existing

conventional vehicles to a BEV or PHEV technology and size the ZEV powertrain components

while ANL’s 2020 publication was used for all FCEV component sizing. Staff updated the

SRIA BEV, PHEV, and FCEV sizing to values based on the more recent 2021 ANL report for

this final analysis.

Second, CARB staff continues to work with U.S. EPA staff on non-battery component costs.

Further analysis of the vehicle teardown reports with U.S. EPA staff, which were used for

424

Department of Finance’s website for Major Regulations SRIAs and Calendar (web link:

http://www.dof.ca.gov/Forecasting/Economics/Major_Regulations/Major_Regulations_Table/)

425

ANL 2021. Islam, Ehsan Sabri, Ram Vijayagopal, Ayman Moawad, Namdoo Kim, Benjamin Dupont, Daniela

Nieto Prada, and Aymeric Rousseau. 2021. A Detailed Vehicle Modeling & Simulation Study Quantifying Energy

Consumption and Cost Reduction of Advanced Vehicle Technologies Through 2050. Report to the US

Department of Energy, Contract ANL/ESD-21/10, Energy Systems Division, Argonne National Laboratory.

https://publications.anl.gov/anlpubs/2021/06/167626.pdf.

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developing the non-battery costs in the SRIA, showed that refinements to non-battery cost

projections should be made. Those refinements, which apply to all ZEV technologies, include:

• Increased permanent magnet motor-specific costs from $3.6/kW to $3.9/kW.

• Increased induction motor-specific costs from $2.1/kW to $2.4/kW.

• Increased single-speed gearbox cost from $400 to $413.44 per system.

• Combined the integrated onboard AC charger (OBC) and DC-DC converter costs such

that the specific cost is $39.75/kW and is applied to the sum of OBC and DC-DC

converter power. The DC-DC converter power is fixed at 3kW across all vehicle types.

• Increased DC-FC circuitry specific cost from $150/kW to $156.28/kW.

• Combined the fixed-cost portion of the OBC cost of $765 and integrated housing,

plus other cost of $65, into a single cost of $719.12, which absorbed the integrated

high voltage (HV) controller cost of $185.

• Increased the HV cabling cost of $180 to $187.44.

• Increased Powertrain cooling cost from $300 to $302.22.

Third, stakeholders commented that performance between the CARB-modeled ZEV

technologies was not consistent. CARB staff addressed those comments by adjusting electric

motor power for each of the ZEV technologies, further explained in the following sections.

Despite the increase in per unit costs for motors and other non-battery components, the

adjustments made to the motor power of the different ZEV technology packages reduced

total non-battery system costs not including fuel cell vehicle specific components where

applicable.

Fourth, stakeholder comments on all-wheel drive (AWD) and towing packages were

considered. Stakeholders commented that costs for traditional ICEV AWD systems were not

being accounted for and appropriately removed. To estimate those costs, staff found two

currently available vehicles that offer nearly identical trims in both front-wheel drive (FWD)

and AWD variants: the 2021MY Toyota RAV4 and 2021 MY Honda CR-V. Table X-1 shows

how the MSRP differences between the variants were used to derive an estimate of the

additional component costs required for AWD over FWD drivetrains. From those differences

in MSRP, the direct manufacturing cost (DMC) of the mechanical AWD components that are

not used for an eAWD has been determined to be $500 which becomes the delete cost for

eAWD systems. Towing packages have been updated for all ZEV technologies in the vehicle

classes where the towing packages can be applied to include additional power.

Table X-1: AWD Mechanical Delete Costs Estimates

158

2021 Toyota RAV4 LE

426

427

2022 Honda CR-V LX

428

429

AWD MSRP

$27,750 $27,900

FWD MSRP ($26,775) ($26,400)

MSRP Delta $975 $1,500

Without RPE (/1.5)

$650 $1,000

Average $825

Staff Estimate of

Component Costs

Common to AWD and

eAWD

430

($325)

Mechanical AWD

Components Delete

Cost

$500

a) Battery Electric Vehicle Cost Updates

CARB staff updated vehicle attribute data from the 2021 ANL Autonomie report and made

the following assumptions:

426

Toyota 2022a. Toyota Motor Sales, U.S.A., Inc. n.d. Toyota RAV4 Configurator - AWD LE. Accessed March 2,

2022. https://www.toyota.com/configurator/build/step/model:engine-drive-

transmission/year/2021/series/rav4/model/4432/.

427

Toyota 2022b. Toyota Motor Sales, U.S.A, Inc. n.d. Toyota RAV4 Configurator - FWD LE. Accessed March 2,

2022. https://www.toyota.com/configurator/build/step/model:engine-drive-

transmission/year/2021/series/rav4/model/4430/.

428

Honda 2022a. American Honda Motor Co., Inc. n.d. 2022 Honda CR-V 2WD LX. Accessed March 2, 2022.

https://automobiles.honda.com/tools/build-and-price-result?modelid=RW1H2NEW&modelseries=cr-

v&modelyear=2022&extcolorcode=NH-830M&tw-

type=fromvlp%3D1#section=Powertrain&group=Powertrain&view=Exterior&angle=0&state=TTpSVzFIMk5FVy

RFQzpOSC04MzBNJEhDOnVuZGVmaW.

429

Honda 2022b. American Honda Co., Inc. n.d. 2022 Honda CR-V AWD LX. Accessed March 2, 2022.

https://automobiles.honda.com/tools/build-and-price-result?modelid=RW1H2NEW&modelseries=cr-

v&modelyear=2022&extcolorcode=NH-830M&tw-

type=fromvlp%3D1#section=Powertrain&group=Powertrain&view=Exterior&angle=0&state=TTpSVzJIMk5FVyR

FQzpOSC04MzBNJEhDOnVuZGVmaW.

430

Includes items like half-shafts, different uprights and suspension components to accommodate drive axles,

etc…

159

• Low versus high technology case - The report presented a low technology and a high

technology pathway. CARB staff found that 2021 ANL Autonomie report’s low

technology pathway best matched expected vehicle attributes due to its less

aggressive light weighting, aero efficiency gains, and tire rolling resistance reductions

over time. CARB staff view this as a more likely scenario in the timeframe of the

regulation.

• Base versus premium model - The report also presented a “base” version, and a

higher performing “premium” version of each vehicle type. Except where towing

packages are generated for the medium SUV, large SUV, and pickup, the report’s

“base” vehicle attributes are used. This is to preserve performance neutrality with the

ICEVs in the fleet today that the BEVs are replacing.

• Lab year - Best in class BEVs available by OEMs today were compared to the modeled

vehicle attributes from the report. ANL lists their modeled vehicle packages in what

they call a “lab year” instead of a model year. Inspection of the ANL report’s outputs

showed that ANL 2015 “lab year” vehicles align with the initial model year ZEV

attributes projected by CARB staff.

Taking this into account, a summary of the modifications made to the efficiencies and

eMotor power used from the 2021 ANL Autonomie report are listed in Table X-2. These

changes lead to a general reduction in costs for these technology packages, although in

some specific cases, the costs increased.

Table X-2: Modifications to 2021 ANL Autonomie BEV Efficiencies and eMotor Power in

Base Year

ANL

Lab

Year

CARB

Model

Year

BEV Type Vehicle Class

Autonomie

Efficiency

Modification

eMotor Power

Modification

2015 2025 BEV300/400

Small Car No modification

Rescaled to 75W/kg

Medium and Large

Car

105%

Small SUV 90%

Medium and Large

SUV

95%

Pickup No modification No modification

Other changes that affect costs include:

• The percentage of usable, or net, battery energy to total, or gross, battery energy has

been further reduced from 95-percent to 92.5-percent to ensure that the modeled

vehicles better account for battery durability and warranty requirements based on

further discussion with stakeholders.

• Based on recently released U.S. EPA analysis for their rule, ACC I GHG technology

removal cost has increased from $965 to $1000, effectively reducing BEV incremental

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costs.

431

CARB staff’s $965 estimate was intended to capture the costs required for an

average 2017MY base ICE vehicle to be compliant with the full implementation of the

ACC I GHG regulations. U.S. EPA’s Revised 2023 and Later Model Year Light Duty

GHG Emissions Standards: Regulatory Impact Analysis estimates the average cost per

vehicle to be $1,000 for the 2026MY.

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The costs for an average 2020MY vehicle to

comply with the 2022MY requirements is estimated to be $455 which comes to $1455

for the average 2020MY vehicle in the fleet to comply with the 2026MY requirement.

Without the 1.5 RPE markup, the direct manufacturing cost is $970, which has been

rounded up to $1,000 to account for the small improvements in technology to a

2017MY vehicle to get to the 2020MY standards in U.S. EPA’s cost estimates.

• Medium SUV BEV300s were using a $1500 transmission removal cost. That has now

been adjusted to $2000 for all Medium SUVs.

The net of these changes has lowered BEV300 and BEV400 incremental costs throughout all

the model years covered by the proposed rule and are presented in Appendix G.

Additionally, staff has found further explanation was warranted to explain how State of

Health (SOC) utilization was calculated, and to provide an updated reference (see footnote

316). Using a 2017 Tesla model 3 (RWD) Long Range BEV as an example, staff referenced

the usable battery energy (78269.46 Wh) found on certification documentation.

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Total

battery energy was calculated with an assumed cell capacity of 5Ah and average discharge

voltage of 3.65V for an energy content of 18.25Wh per cell. The Munro Model 3 Teardown

showed the vehicle had 4416 cells and with 18.25 Wh per cell the total battery pack energy

content came to 80,592 Wh. The UBE of 78,269.46 Wh divided by 80,592 Wh equaled 97.1-

percent which was rounded down to 97-percent for initial SOC utilization percentage.

b) Plug-in Hybrid Vehicle Cost Updates

Similar to BEVs, CARB staff updated PHEV costs using vehicle attribute data from the 2021

ANL Autonomie report with some adjustments. Like BEVs, the low technology pathway is

used for all vehicle attributes due to its less aggressive light weighting, aerodynamic

efficiency gains, and tire rolling resistance reductions. CARB staff view this as a more likely

scenario in the timeframe of the regulation. The “base” versions of each vehicle type from

the 2021 ANL Autonomie report are used in most cases, except where towing packages are

generated for the medium and large SUV, and pickup categories. Inspection of the ANL

report’s outputs showed that ANL 2015 “lab year” vehicles align with 2025 model year ZEV

attributes projected by CARB staff.

The PHEV attributes and modifications to those attributes used from the 2021 ANL Report

are listed in Table X-3.

431

EPA 2021a. U.S. Environmental Protection Agency, 2021, 40 CFR Parts 86 and 600, Federal Register 86, no.

248 (December 30, 2021): 74434, https://www.govinfo.gov/content/pkg/FR-2021-12-30/pdf/2021-27854.pdf

432

EPA 2021b. U.S. Environmental Protection Agency. 2021. Revised 2023 and Later Model Year Light-Duty

Vehicle GHG Emissions Standards: Regulatory Impact Analysis. U.S. Environmental Protection Agency.

https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P1013ORN.pdf.

433

EPA 2022. (updated reference from Draft SRIA) "EPA's Transportation and Air Quality Document Index

System (DIS)." EPA.gov. June 21. Accessed March 3, 2022.

https://dis.epa.gov/otaqpub/display_file.jsp?docid=40001&flag=1.

161

Table X-3: Attributes From, and Modifications to 2021 ANL Autonomie PHEV Efficiencies

and eMotor Power in Base Year

ANL

Lab

Year

CARB

Model

Year

Vehicle Class

Autonomie

Efficiency

Values

eMotor Power

Modification

2015 2025

Small Car

EREV PHEV50

Charge

Depleting

Adjusted Value

(Wh/mi) used

with no

modification

Average EREV

PHEV50 eMotor

Power to Weight

(66W/kg) Applied to

Par PHEV50 Turbo

Vehicle Mass

Medium and Large Car

Small SUV

Medium and Large SUV

Pickup

Additional changes that affect PHEV technology costs include:

• PHEV battery SOC utilization has also been adjusted downward from 85-percent to

80-percent to account for proposed durability requirements.

• Battery cost over BEV battery cost has been adjusted downward from a 40-percent

premium to a 30-percent premium based on stakeholder feedback.

• Identical to BEVs, the GHG ACC I technology removal cost has been adjusted from

$965 to $1,000.

The net of these changes has lowered PHEV50 incremental costs throughout all the model

years covered by the proposed rule and are presented in Appendix G.

c) Fuel Cell Electric Vehicle Cost Update

To develop cost estimates for fuel cell and hydrogen storage systems in the SRIA, CARB staff

referenced data and models provided by ANL through its Autonomie model and provided by

Strategic Analysis, Inc. Estimates from ANL address potential future cost reductions due to

technology advancement, but do not incorporate the effect of annual production volume on

cost or additional costs for high-durability fuel cell designs. By contrast, Strategic Analysis

models estimate cost as a function of production volume, but only for today’s state-of-the-art

high-durability technology. The cost estimation method developed by CARB for the SRIA

integrated these effects on cost into a single model.

After the SRIA was published, ANL published a revised set of vehicle equipment

specifications and cost estimates. Importantly, the cost estimates in the new ANL publication

directly incorporate the Strategic Analysis models for high-durability fuel cells and varying

production volume in future years. The assumed production volumes in the revised ANL data

were similar to CARB’s estimates in the SRIA. The new ANL data also updates cost and

equipment specifications based on updated equipment performance models. CARB has

revised its cost estimates for fuel cell and hydrogen storage systems to reflect the more up-

to-date data in the new ANL publication. Because the new estimates also incorporate the

Strategic Analysis models, CARB staff did not need to develop a separate cost estimate

methodology.

With the new data from ANL, equipment specifications and system costs changed. The

magnitude and direction (whether costs were higher or lower than the SRIA) of the change in

costs depended on model year and vehicle class. The incremental DMCs for all vehicle and

162

technology combinations is shown in Appendix G: ACC II ZEV Technology Assessment. In all

cases, hydrogen storage system costs are higher in the revised estimates than previously

reported in the SRIA. Fuel cell system costs are also generally higher than previously

reported in the SRIA, with the exception of Medium Cars, Medium SUVs, and Pickups in

model years 2032 and later.

d) Towing Package Updates

Power for all ZEV and PHEV towing packages has been revised relative to the modeling

completed for the SRIA. The source of the revisions comes from the 2021 ANL Autonomie

report. Towing packages in the SRIA did not account for additional power where they now

do for this analysis. Towing package medium and large SUVs, and pickups use the 2021 ANL

Autonomie report’s “premium” vehicle variants’ higher electric motor power as shown in

Table X-4. The FCEV towing variants also receive additional power for their batteries and fuel

cell stack as described in Section IV Battery Assumptions and Cost of Appendix G. The

electric motor power for those packages is shown in Table X-4 and the additive costs of the

towing package is shown in Table X-5.

Table X-4. Attributes From 2021 ANL Autonomie eMotor Power in Base Year for BEV,

PHEV, and FCEV Towing Packages

ANL

Lab

Year

CARB

Model

Year

Vehicle Class Towing Package eMotor Power Basis

2015 2025

Small Car

N/A

Medium and Large Car

Small SUV

Medium and Large SUV

“Premium” Vehicle Version eMotor

Power (kW) used with no modification

Pickup

Table X-5. Towing Package eMotor Power Updates from the SRIA for the 2031MY

Vehicle Class Technology

SRIA

Values

(kW)

Updated

Values

(kW)

Medium and

Large SUV

BEV300/400 184/218 211

FCEV 144 166

PHEV 155 165

Pickup

BEV300/400 214/234 265

FCEV 166 201

PHEV 201 207

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Table X-6. Towing Package Cost Updates from the SRIA for the 2031MY

Vehicle Class Technology

SRIA

Costs

Updated

Costs

Medium and

Large SUV

BEV300 $5,933 $6,952

BEV400 $4,627 $5,365

FCEV $0 $3,539

PHEV $0 $366

Pickup

BEV300 $8,762 $9,478

BEV400 $7,194 $7,530

FCEV $0 $1,338

PHEV $0 $284

e) Cost Summary

Technology package costs are presented in Appendix G. An example of the changes to the

vehicle attributes and costs for the medium and large SUV category for the 2031MY is shown

in Table X-7.

Table X-7: 2031MY Incremental Vehicle Cost Updates Since the SRIA

Medium and Large SUV Small Car

Technology Type

SRIA Cost Updated Cost SRIA Cost Updated Cost

BEV300

$1,592 -$369 $1,009 -$53

BEV400

$4,119 $2,769 $3,111 $2,377

PHEV

$3,685 $3,345 $2,853 $2,413

FCEV

$4,103 $2,784 $2,776 $3,154

2. Updated Baseline Assumptions

Staff updated the ZEV technology fractions in the California baseline fleet based on new

nationwide ZEV sales projections under the U.S. EPA Final Rule to Revise Existing National

GHG Emissions Standards for Passenger Cars and Light Trucks Through Model Year 2026.

434

EPA 2021a

164

With the rulemaking, the U.S. EPA implemented new, more stringent GHG standards and

estimated higher nationwide ZEV penetration rates in the future light-duty vehicle fleet to

comply with them. Specifically, the rulemaking projected increasing new fleet ZEV

penetration from 2023 – 2026 and subsequent model years with a final ZEV penetration rate

of 17-percent in model year 2026 nationally for both passenger car and light truck fleets.

In the analysis for the SRIA, EMFAC2021 inventory projected the California 2026 ZEV sales

fraction as 12-percent and therefore had to be adjusted for this analysis to account for the

new U.S. EPA rule. However, the U.S. EPA compliance analysis has assumptions for the

national fleet and does not project the California fleet separately. Historical geographic

trends in ZEV sales have always indicated larger ZEV sales fractions in the California fleet

compared to the nationwide fleet. To address that, CARB staff generated new estimates of

the ZEV sales fractions in the California baseline fleet to adjust the EMFAC2021 model for

this rulemaking. Specifically, staff increased California ZEV sales fractions in the baseline for

model years 2023 -2026 by applying the corresponding percentage increase of ZEV sales

fractions found in the nationwide fleet for those same model years. This adjustment applied

to both passenger cars and light trucks and reflected the higher ZEV penetration in the

nationwide fleet for model years 2023 and beyond as a result of the federal rulemaking. The

final ZEV fractions in the California baseline for the combined passenger car and light truck

new vehicle fleet resulting from these adjustments are depicted in the graph below. The

graph also includes the original baseline fractions used in the SRIA and the U.S. EPA final

rulemaking (FRM) fraction projections for 2023-2026.

Figure 30: ZEV Sales Fractions in the Updated ACCII Baseline, SRIA baseline and U.S.

EPA FRM

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The final adjusted ZEV penetration rates for the individual vehicle classes in the EMFAC2021

model are shown in the graph below.

Figure 31: Final Adjusted ZEV Sales Fractions Used for the California Baseline by Vehicle

Class

3. Updated Minor Assumptions for Fleet Modeling

In addition to the baseline updates, staff made changes to fleet modeling assumptions when

calculating the total costs associated with the proposal, which are summarized in this section.

3.1 Updates to the vehicle class distributions.

For the SRIA, staff used California MY 2017 data derived from GHG compliance reports and

NHTSA VOLPE model vehicle class assignments to generate vehicle class distributions in the

California fleet. As the proposal has progressed, staff updated the vehicle class distribution

with a more recent data set. For this analysis staff used POLK MY 2019 data for California to

update the relative distributions of the five vehicle classes (i.e., small car, medium car, etc.) in

fleet cost modeling.

3.2 Updates to the allocation of sales for BEV300 and BEV400 vehicles.

For the SRIA, staff assumed no BEV300 sales cap, but assumed there were additional vehicle

classes that could only be filled with BEV400 vehicles (or PHEVs or FCEVs). These vehicles

were designated as premium vehicles. For this ISOR analysis, staff implemented a 50-percent

sales cap for BEV300 vehicles in each and every vehicle class and made no assumptions

about the presence of premium or base vehicles in the fleet.

3.3 Implementation of 5-year ZEV-to-ZEV re-design cycles to ensure fleet cost

optimization.

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For the SRIA, staff assumed all conversions of ICEVs to a particular ZEV technology in a

particular vehicle class were permanent for the duration of the regulatory timeframe (2026-

2035). This essentially created a built-in modeling assumption that the most cost-effective

ZEV technology initially assigned to any ICEV vehicle class in a particular model year would

remain the most cost-effective technology for all future model years in that vehicle class. In

the case of the SRIA, this was a valid assumption for all vehicle classes since the relative cost-

effectiveness of any ZEV technology did not change between the year the ZEV technology

was implemented to the end of the regulatory timeframe. For example, if a particular vehicle

class was assigned BEV technology due to it being the most cost-effective technology

(relative to PHEVs and FCEVs) for that model year, staff assumed this same trend would

continue for the remaining model years and that PHEVs or FCEVs would not become more

cost-effective in future calendar years.

For this ISOR analysis, staff performed post-modeling output reviews of the ZEV technology

assignments in each model year to determine if the ZEV technology assignments to each

vehicle class were the most cost-effective choice for that vehicle class. Based on these

reviews, staff determined the technology assignments for all vehicle classes in all model years

were appropriate except for small cars with 2WD. Specifically, this vehicle class was assigned

PHEV technology in MY 2028 based on it having the lowest average incremental cost over

the next 5-year time period (i.e., it was the most cost-effective option for this vehicle class in

that 5-year time period). By MY 2031, however, the 5-year average incremental cost for

BEV400s was lower than PHEVs, which indicated BEV400s were the most cost-effective

option for fleet compliance in that vehicle class for future model years. In recognition of this,

staff manually updated the fleet cost model output to incorporate a ZEV-to-ZEV (i.e., PHEV

to BEV400) technology re-design in that vehicle class in 2034, which recognizes that OEMs

typically allow for major re-designs of vehicle technologies every five years. By doing this, the

model output more accurately reflected how OEMs would comply with the regulation. The

figure below provides a comparison of the fleet incremental cost output with and without the

ZEV-to-ZEV redesign in 2034 for the small car 2WD vehicle class.

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Figure 32: Fleet Incremental Costs: With vs. Without ZEV-to-ZEV Re-Design in 2034

4. Changes to ZEV Sales Requirements

Since the SRIA, the proposed regulation was modified to include the increased ZEV

regulatory stringency, meaning the number of ZEVs and PHEVs required annually. The

increased ZEV stringency requirements were a result of a few factors and are fully described

in Section III.C.1. The first was updated 2021 ZEV projections for the next few model years,

submitted by OEMs as part of an annual survey with automakers that CARB administers.

These data were thoroughly analyzed by staff and gave assurance and support for increasing

the stringency. Staff’s SRIA proposal was based on the prior 2020 projections submitted by

OEMs. Additionally, since staff’s SRIA analysis was completed, OEMs have continued public

announcements for investments in electrification and commitments to ZEV models, which

supports the OEM survey results. Together, these two considerations support increasing the

proposal and will achieve more certainty of higher volumes of ZEVs in the first five years of

the program. No change was made to 2031 and subsequent model year ZEV stringency

requirements for this analysis from the SRIA.

5. Total Costs to the Manufacturer

Taking into account the total costs of the ZEV requirements and the LEV requirements the

costs are summarized in Table X-8 below.

Table X-8: Cumulative and Incremental Costs of the Proposed Regulation

MY Total Sales

Cumulative Total

Cost

Average

Incremental Cost

($)

168

2026 1,962,693 $ 936,874,851 $ 477

2027 1,970,200 $ 1,219,900,383 $ 619

2028 1,977,385 $ 1,406,936,846 $ 712

2029 1,984,221 $ 1,648,844,575 $ 831

2030 1,990,770 $ 2,098,765,531 $ 1,054

2031 1,996,930 $ 2,358,137,658 $ 1,181

2032 2,002,844 $ 2,398,612,917 $ 1,198

2033 2,008,417 $ 2,407,834,951 $ 1,199

2034 2,013,646 $ 2,165,031,790 $ 1,075

2035 2,018,543 $ 2,258,866,756 $ 1,119

2036 2,028,636 $ 2,269,070,998 $ 1,119

2037 2,038,779 $ 2,280,416,353 $ 1,119

2038 2,048,973 $ 2,291,818,435 $ 1,119

2039 2,059,218 $ 2,303,277,527 $ 1,119

2040 2,069,514 $ 2,314,793,915 $ 1,119

Average Annual 2,011,385 $ 2,023,945,566 $ 1,006

Total 30,170,771 $ 30,359,183,488 $ 1,006

B. The creation or elimination of jobs within the State of California.

Statewide economic impacts are summarized below. Detailed information, supporting figures

and tables are included in the SRIA document provided in Appendix C.

Table X-9 presents the impact of the proposed regulation on total employment in California

across all industries. Employment comprises estimates of the number of jobs, full-time and

part-time, by place of work for all industries. Full-time and part-time jobs are counted at

equal weight. Employees, sole proprietors, and active partners are included, but unpaid

family workers and volunteers are not included. The employment impacts represent the net

change in employment, which consist of positive impacts for some industries and negative

impacts for others. The proposed regulation is estimated to have a negative impact on

169

employment growth beginning in 2026, which increases through 2035 as the Proposed

Regulation becomes more stringent but begins to diminish post-2035 as operational cost-

savings grow and vehicle costs decrease. The results suggest that the estimated negative

employment impact primarily results from the increase in upfront vehicle cost and changes in

consumer spending induced by the proposed regulation; as more is expended on new motor

vehicles, consumers will spend less on other goods and services within the economy. The

results are further described at the industry level in the following paragraph. These changes

in employment do not exceed 0.3-percent of baseline California employment across the

entire regulatory horizon.

Table X-9: Total California Employment Impacts

2026 2028 2030 2032 2034 2036 2038 2040

California

Employment

25,473,923 25,456,776 25,463,449 25,528,613 25,657,760 25,817,630 26,025,822 26,274,068

% Change

-0.02% -0.08% -0.16% -0.21% -0.23%

-0.21% -0.18% -0.15%

Change in

Total Jobs

-4,115 -20,299 -41,176 -54,649 -59,853

-54,886 -47,582 -39,804

The total employment impacts shown above are net of changes at the industry level. The

overall trend in employment changes by major sector is illustrated in Table X-10 shows the

changes in employment by industries that are directly impacted by the proposed regulation.

As the requirements of the Proposed Regulation go into effect, consumers and businesses

must initially spend more on vehicle purchases, reducing spending elsewhere in the

economy, which tends to reduce employment across many industries that serve and produce

goods for consumers. Over time vehicle purchasers are estimated to realize operational cost-

savings, shifting consumer spending away from categories such as vehicle maintenance and

repair and gasoline and towards other areas. The reduced spending in these categories

accounts for a significant portion of the employment impact (shown for year 2040), where the

vehicle repair and maintenance industry sees about 31,800 jobs foregone (13.8-percent of

baseline employment) and petroleum products manufacturing (i.e. refineries) industry sees

about 1,400 jobs foregone (12.8-percent of baseline). To help mitigate this job impact, policy

options could be considered for job retraining and transfer support, particularly for lower

income individuals. The retail trade sector comprises a significant portion of the economy

and is estimated to have about 38,700 jobs foregone (2.1-percent of baseline), resulting from

the overall shift in consumer spending due to incremental vehicle costs and specifically due

to reduced gasoline sales of which gasoline stations are expected to see negative impacts

unless they transitioned to providing charging. BEV drivers still need to stop for charging, so

retail spending likely will shift to locations associated with charging infrastructure. Therefore,

the net impact may not be well reflected in this analysis. The decrease in gasoline sales is

estimated to significantly reduce fuel tax revenue at the state and local level. This reduces

government spending, leading to about 20,800 jobs foregone (0.8-percent of baseline) in

state and local government employment, if revenue decreases are not offset. This foregone

revenue, which supports important programs in the state, may eventually be replaced by

revenue from other sources or changes in how electricity for transportation is taxed, in which

case these negative job impacts to state and local government would be diminished.

However, this is outside the scope of the Proposed Regulation and not evaluated here. It is

important to note that many of these negative job impacts represent a structural shift for

these industries that directly corresponds to substantial benefits to ZEV owners who will have

170

much lower operational costs from the lower fuel expenses of ZEVs and that require much

less maintenance and repair.

The results also suggest that the electric power industry is one of the main industries to

benefit from the regulation seeing a gain of about 5,600 jobs (17.5-percent of baseline), as

ZEV purchasers spend more on electricity to power their vehicles.

Table X-10: Employment Impacts by Primary and Secondary Industries

Industry

Metric

2026

2028

2030

2032

2034

2036

2038

2040

Electric power

generation, transmission

and distribution (2211)

% Change

0.44%

2.10%

4.73%

8.15%

11.93%

15.16%

16.96%

17.53%

Change in

Jobs

164 766 1,687 2,842 4,073

5,072

5,567

5,649

Construction (23)

% Change

-0.03%

-0.18%

-0.34%

-0.35%

-0.21%

0.03%

0.22%

0.28%

Change in

Jobs

-455 -2,360 -4,353 -4,499 -2,678

402

2,775

3,618

Petroleum and coal

products manufacturing

(324)

% Change

-0.27%

-1.31%

-2.85%

-4.92%

-7.30%

-9.74%

-11.62%

-12.78%

Change in

Jobs

-34 -158 -338 -574 -835

-1,095

-1,284

-1,389

Basic chemical

manufacturing (3251)

% Change

-0.02%

-0.10%

0.14%

0.64%

0.95%

1.24%

1.54%

1.82%

Change in

Jobs

-2 -7 10 46 69

113

134

Insurance carriers (5241)

% Change

0.02%

0.09%

0.19%

0.37%

0.59%

0.85%

1.06%

1.08%

Change in

Jobs

42 159 325 628 984

1,391

1,708

1,719

Retail trade (44-45)

% Change

-0.08%

-0.36%

-0.73%

-1.14%

-1.54%

-1.87%

-2.06%

-2.07%

Change in

Jobs

-1,580 -6,691 -13,543 -20,929 -28,090

-34,040

-37,811

-38,669

Automotive repair and

maintenance (8111)

% Change

-0.33%

-1.47%

-3.06%

-5.18%

-7.80%

-10.63%

-13.07%

-13.73%

Change in

Jobs

-758 -3,416 -7,073 -11,974 -18,042

-24,586

-30,235

-31,767

State & Local

Government

% Change

0.00%

-0.07%

-0.18%

-0.33%

-0.49%

-0.63%

-0.74%

-0.83%

Change in

Jobs

118 -1,686 -4,425 -8,082 -12,186

-15,732

-18,432

-20,831

C. The creation of new business or the elimination of existing businesses within the

State of California.

The REMI model cannot directly estimate the creation or elimination of businesses. However,

changes in jobs and output for the California economy described above can be used to

171

understand some potential impacts. The overall jobs and output impacts of the Proposed

Regulation are small relative to the total California economy, representing changes of no

greater than 0.4-percent. However, impacts to specific industries are larger as described in

previous sections. The trend of increasing demand for electricity in the electric power sector

similarly sees large increases in sales, but its services are provided primarily by existing

utilities. New utilities are not expected to be created to meet this increased demand. The

decreasing trend in demand for gasoline has the potential to result in the elimination of

businesses in this industry and downstream industries, such as gasoline stations and vehicle

repair businesses, if sustained over time. As described above the vehicle repair and

maintenance service industry is estimated to see negative impacts, including dealerships that

have service departments, as ZEVs become a greater portion of the fleet. This trend would

suggest that the number of businesses providing the services may decrease along with the

reduced demand.

D. The expansion of businesses currently doing business within the State of

California.

The Proposed Regulation will increase the total amount of electric vehicle miles traveled in

the state, which in turn will increase the demand for electricity. Electricity generation and

installation of infrastructure needed to charge BEVs and PHEVs represents the single largest

growth area for electric utility companies as traditional areas of growth have been dampened

by energy conservation efforts.

ZEVs also provide an opportunity to mitigate disruptions in supplying electrical power for use

other than transportation. In recent years, the utility companies in California have been

proactively shutting down large sections of the grid, at times for several days, to avoid

starting wildfires during windy dry seasons, primarily from trees that are blown or fall into

electrical distribution and transmission lines. The use of ZEVs to provide grid services and

decentralized backup power for California residents is feasible within the regulation period.

This would be accomplished through features on vehicles that enable them to discharge

electrical energy in their batteries to supply external needs, such as in a home. This could

create another revenue stream for commercial ZEV fleet operators and reduce costs to

electric utilities compared to investments in stationary backup power systems.

The Proposed Regulation also helps the state’s investor-owned utilities meet the goals of

Senate Bill 350, the Clean Energy and Pollution Reduction Act of 2015, with a faster financial

return on infrastructure investments. Senate Bill 350 requires the state’s investor-owned

utilities to develop programs “to accelerate widespread transportation electrification,” with

goals to reduce dependence on petroleum, increase the adoption of zero-emission vehicles,

help meet air quality standards, and reduce greenhouse gas emissions. Southern California

Edison (SCE) and San Diego Gas & Electric (SDG&E) have both proposed programs that are

awaiting approval by the Public Utilities Commission to extend light-duty electric vehicle

infrastructure pilots that use ratepayer funds to support investment in electric vehicle

charging infrastructure. Pacific Gas & Electric has been approved for a direct current fast

charging make-ready program, and the three smaller investor-owned utilities have also been

approved for light-duty electric vehicle infrastructure programs. Furthermore, PG&E, SCE,

and SDG&E have either proposed or have been approved to establish new electricity rates

for commercial ZEV infrastructure. By ensuring additional electric vehicles will be available to

make use of these utility investments, the Proposed Regulation supports the utilities’

programs and the goals of SB 350.

172

In addition to the electric utilities that will supply additional electricity to BEVs and PHEVs

under the proposed regulation, ZEV infrastructure businesses will benefit as well. These

include companies that manufacture, install, operate, and maintain electric vehicle charging

stations and hydrogen dispensing equipment. Electric Vehicle Supply Equipment (EVSE)

providers and hydrogen station operators will also benefit from increased demand for their

equipment in home and public fueling stations. The Proposed Regulation will increase the

total amount of electric vehicle miles travelled in the state, which in turn could increase

utilization of charging and hydrogen stations across the state and lead to increased revenue

for these businesses, making the business model for their investment more stable and

predictable. This allows investor capital and venture capital funds to be accessed to

accelerate deployment of ZEV infrastructure. Increased use of public charging stations may

also have benefits to retail businesses near charging stations. Many charging stations are

near shopping, food, or other services. Customers may increase accessing these services

while their vehicles refuel.

E. Significant Statewide Adverse Economic Impact Directly Affecting Business,

Including Ability to Compete

The Executive Officer has made an initial determination that the proposed regulatory action

would not have a significant statewide adverse economic impact directly affecting

businesses, including the ability of California businesses to compete with businesses in other

state, or on representative private persons.

F. The competitive advantages or disadvantages for businesses currently doing

business within the state

While CARB is not aware of any evidence of the extent to which this is occurring under

existing requirements, automakers that are already producing ZEVs may have an advantage

in growing market share under more stringent ZEV requirements over manufacturers that

have not yet come to market with a widely available product. Though some consumers may

be holding out for a specific manufacturer’s product, many consumers will purchase products

that have wide distribution networks. As the requirements increase towards 100-percent,

this advantage may decline as every automaker invests in ZEV technology and products at a

wide scale.

G. The increase or decrease of investment in the state

Private domestic investment consists of purchases of residential and nonresidential structures

and of equipment and software by private businesses and nonprofit institutions. It is used as

a proxy for impacts on investments in California because it provides an indicator of the future

productive capacity of the economy.

The relative changes to growth in private investment for the Proposed Regulation are

illustrated in Table X-11. These results show a decrease in private investment of about $690

million in 2030, which is followed by a positive trend resulting in an increase of $4.9 billion in

2040. This trend follows the cost impacts for private industries which will purchase ZEVs for

businesses purposes, whereas operational savings begin to accumulate over time, production

costs decrease, which leads to expanding market share and investment. These changes in

investment do not exceed 0.9-percent baseline investment across the regulatory horizon.

173

Table X-11: Change in Gross Domestic Investment Growth

2026 2028 2030 2032 2034 2036 2038 2040

Private

Investment

(2020M$)

505,625 511,821 522,983 535,029 549,820

566,271 585,020 605,645

% Change

-0.02% -0.09% -0.13% -0.05% 0.17%

0.46% 0.68% 0.81%

Change

(2020M$)

-103 -452 -689 -247 933

2,582 3,998 4,882

H. The incentives for innovation in products, materials, or processes

The manufacturer sales requirement for ZEVs as part of ACCII provides flexibilities, giving

manufacturers the incentive to innovate and identify lower cost strategies for achieving the

zero-emission requirement. For example, manufacturers are allowed to comply by selling

ZEVs across multiple vehicle classifications, allowing each manufacturer to focus on products

and areas of the market where they typically compete. Innovations leading to lower cost ZEV

models likely will result in increased sales within the mass market. Additionally, manufacturers

are incentivized to innovate and bring ZEV models to secure their place in popular or

growing vehicle segments, with the signal that the entire market will be at 100-percent in

2035.

I. The benefits of the regulation to the health and welfare of California residents,

worker safety, and the state’s environment.

The proposed regulation will benefit individual California residents mainly by reducing

adverse health impacts caused by criteria emissions such as NMOG, NOx, and PM. The

reduction of GHG emissions helps combat climate change and its destructive environmental

effects felt by California residents. The cumulative NMOG, NOx, PM

2.5

, and GHG emission

reductions under the proposed regulation are summarized in Table VII-1.

XI. Evaluation of Regulatory Alternatives

Government Code section 11346.2, subdivision (b)(4) requires CARB to consider and

evaluate reasonable alternatives to the proposed regulatory action and provide reasons for

rejecting those alternatives. This section discusses alternatives evaluated and provides

reasons why these alternatives were not included in the proposal. As explained below, no

alternative proposed was found to be less burdensome and equally effective in achieving the

purposes of the regulation in a manner than ensures full compliance with the authorizing law.

Staff has not identified any reasonable alternatives that would lessen any adverse impact on

small business. The two alternatives considered evaluated a change to the ZEV sales

percentages because this has the most impact on costs and emission benefits.

174

A. Alternative Considered with Different Sales Percentage Requirements Than the

Proposal

1. Description of Alternatives

a) Alternative 1 – 70-percent ZEV stringency by 2035

The first alternative considered proposes minimum 70-percent ZEV and PHEV sales by 2035

instead of the preferred proposal of 100-percent ZEV sales by 2035. This alternative is based

on survey data that shows approximately 30-percent of survey respondents have rejected

considering electric vehicle technology and show hesitation in purchasing ZEVs or

PHEVs.

435

Although staff does think this market hesitancy will change over time as ZEVs

become cheaper, the market broadens and consumers become more familiar with this

technology, conducting a cost and emissions impact analysis for a lower bound of ZEVs and

PHEVs that accounts for more gasoline vehicles meeting the proposed LEV standard, is

important for understanding the effect of transitioning the new fleet to zero-emission

technology.

b) Alternative 2 – 100-percent ZEV stringency by 2035 with a different

traj

ectory

Alternative 2 incorporates the ZEV sales fractions presented in the 2020 Mobile Source

Strategy for calendar years 2026-2035, which would require higher electrification in 2026-

2030 as compared to staff’s proposal. The Mobile Source Strategy is a top-down analysis of

potential ZEV sales penetrations that would aid in achieving state and federal clean air goals,

but did not include any regulatory feasibility analysis. Its trajectories assume a suite of policy

changes, including public incentives, regulations, and private sector strategies on behalf of

companies, but does not evaluate their feasibility. Accordingly, the Strategy itself does not

determine the proper course of any particular regulatory proposal. However, the Strategy

does provide a useful upper-bound scenario that could achieve important emission goals,

and so serves as a useful alternative to evaluate. This Alternative would assume the most

favorable ZEV market conditions, and that OEMs would be able to quickly redirect ZEV

deployment to California to meet increased near-term requirements.

Table XI-1: ZEV Sales Percentage Requirements by Scenario

2026 2027 2028 2029 2030 2031 2032 2033 2034 2035+

Proposal

35% 43% 51% 59% 68% 76% 82% 88% 94% 100%

Alt 1

23% 29% 34% 39% 45% 50% 55% 60% 65% 70%

Alt 2

46% 52% 58% 64% 70% 76% 82% 88% 94% 100%

435

Kurani et al 2016. Kurani, Kenneth, Nicolette Caperello, and Jennifer TyreeHapegeman. 2016. “New Car

Buyers’ Valuation of Zero-Emission Vehicles: California” https://ww2.arb.ca.gov/sites/default/files/2020-

04/12_332_ac.pdf , accessed on October 18, 2021

175

2. Total Manufacturer Costs for Alternatives

The total manufacturer costs associated with Alternative 1 and 2 are presented in the table

below. For the purposes of simplification, only the costs associated with the ZEV sales

requirements are summarized in the Table XI-2. The ZEV assurance measures in the

proposal and modifications to LEV regulations are not included.

Table XI-2: Alternative 1 and Alternative 2 Average Incremental Cost and Total

Cumulative Cost

Alternative 1 Alternative 2

Model Year

Ave. Incremental

Cost Per Vehicle ($)

Cumulative Total

Cost ($)

Ave. Incremental

Cost Per Vehicle ($)

Cumulative Total

Cost ($)

2026

$67

$127,511,686 $923 $ 1,764,600,936

2027

$178

$469,733,574 $969 $3,626,945,252

2028

$230

$914,957,349 $1,010 $5,577,550,776

2029

$220

$1,341,592,373 $1,077 $7,667,279,106

2030

$193

$1,717,509,469 $1,150 $9,910,081,875

2031

$165

$2,040,573,278 $1,187 $12,235,666,078

2032

$217

$2,458,484,191 $1,209 $14,614,066,532

2033 $232 $2,912,736,570 $1,130 $16,846,496,405

2034 $216 $3,325,550,551 $1,080 $18,989,527,983

2035 $162 $3,647,690,406 $1,124 $21,228,910,569

Compared to the proposal cumulative total costs of 2,314,793,915 in 2040, Alternative 1 and

Alternative 2 are most costly.

176

3. Emission Benefits for the Alternatives

Alternative 1 Alternative 2

Calendar

Year

NOx (tpd)

PM2.5

(tpd)

CO2

(MMT/yr)

NOx (tpd)

PM2.5

(tpd)

CO2

(MMT/yr)

2026

0.4 0.0 0.2 0.8 0.1 1.8

2027

0.9 0.0 0.7 1.9 0.1 4.0

2028

1.6 0.0 1.7

3.2 0.2 6.4

2029

2.5 0.1 3.0 4.7 0.3 9.2

2030

3.6 0.1 4.7

6.4 0.4 12.3

2031

4.8 0.2 6.9 8.3 0.5 16.0

2032

6.1 0.3 9.4

10.4 0.6 20.0

2033

7.7 0.4 12.3 12.7 0.8 24.7

2034

9.4 0.5 15.6

15.2 1.0 29.8

2035

11.3 0.7 19.2 17.9 1.1 35.2

2036

13.2 0.8 22.6

20.6 1.3 40.4

2037

15.1 0.9 25.9 23.2 1.5 45.3

2038

16.9 1.1 29.0

25.8 1.7 50.0

2039

18.7 1.2 31.9 28.4 1.9 54.5

2040

20.4 1.3 34.6

30.9 2.1 58.6

Through the proposed regulation, California will see a cumulative reduction over the period

of 2026 to 2040 of 69,569 tons NO

, 4,469 tons PM

2.5

and 383.5 MMT of CO

emissions (well-

to-wheels emissions accounting for fuel production). Alternative 1 does not get enough

emission reductions and Alternative 2 has similar emission reductions with a much larger cost.

177

4. Health Benefits

Table XI-3: Avoided Mortality and Morbidity Incidents Statewide from 2026 to 2040 under

Alternative 1 and Alternative 2*

Avoided

Cardiopulmonary

Deaths

Avoided

Hospitalizations

for Cardiovascular

Illness

Avoided

Hospitalizations

for Respiratory

Illness

Avoided ER visits

for Asthma

Alternative 1

Statewide

791 (618 - 967) 129 (0 - 253) 154 (36 - 272) 395 (250 - 541)

Alternative 2

Statewide

1350 (1055 -

1652) 221 (0 - 433) 264 (62 - 465) 679 (430 - 929)

*Values in parentheses represent the estimated within the 95% confidence interval. Totals may

not add due to rounding. Except for the five major air basins, results for the rest of the state are

presented at a more regional scale due to the uncertain nature of upstream emission estimates

included in the calculations.

The proposal will lead to 1,272 fewer cardiopulmonary deaths; 208 fewer hospital admissions

for cardiovascular illness; 249 fewer hospital admissions for respiratory illness; and 639 fewer

emergency room visits for asthma.

5. Monetized Health Benefits for Alternatives and Social Cost of Carbon

for Alternatives

Table XI-4: Cumulative Monetized Health Benefits for Alternatives (2026-2040)

Alternative 1 Alternative 2

Endpoint

Avoided

Incidents

Valuation

(Million

2020$)

Avoided

Incidents

Valuation

(Million

2020$)

Cardiopulmonary mortality 791 $7,932.3 1350 $13,544.9

Hospitalizations for cardiovascular

illness

129 $7.6 221 $13.1

Hospitalizations for respiratory illness 154 $8.0 264 $13.6

Emergency room visits 395 $0.3 679 $0.6

Total $7,948 $13,572

178

Table XI-5: Avoided Social Cost of Carbon for Alternative 1

Year

GHG

Emission

Reductions

(MMT)

Avoided SC-CO2

(Million 2020$)

5% Discount Rate

Avoided SC-CO2

(Million 2020$)

3% Discount Rate

Avoided SC-CO2

(Million 2020$)

2.5% Discount Rate

2026 0.2 $4 $12 $18

2027 0.7 $14 $44 $64

2028 1.7 $33 $109 $158

2029 3.0 $59 $193 $283

2030 4.7 $99 $308 $450

2031 6.9 $145 $462 $670

2032 9.4 $210 $641 $925

2033 12.3 $274 $855 $1,227

2034 15.6 $368 $1,105 $1,576

2035 19.2 $454 $1,386 $1,965

2036 22.6 $563 $1,661 $2,343

2037 25.9 $646 $1,937 $2,753

2038 29.0 $761 $2,207 $3,121

2039 31.9 $837 $2,470 $3,474

2040 34.6 $953 $2,724 $3,814

Total 217.7 $5,421 $16,116 $22,843

179

Table XI-6: Avoided Social Cost of Carbon for Alternative 2

Year

GHG

Emission

Reductions

(MMT)

Avoided SC-CO2

(Million 2020$)

5% Discount Rate

Avoided SC-CO2

(Million 2020$)

3% Discount Rate

Avoided SC-CO2

(Million 2020$)

2.5% Discount Rate

2026 1.8 $33 $111 $163

2027 4.0 $79 $252 $367

2028 6.4 $126 $412 $596

2029 9.2 $181 $592 $869

2030 12.3 $258 $807 $1,178

2031 16.0 $336 $1,071 $1,554

2032 20.0 $446 $1,365 $1,968

2033 24.7 $551 $1,718 $2,463

2034 29.8 $704 $2,112 $3,011

2035 35.2 $831 $2,541 $3,603

2036 40.4 $1,007 $2,969 $4,188

2037 45.3 $1,129 $3,388 $4,815

2038 50.0 $1,312 $3,806 $5,380

2039 54.5 $1,430 $4,220 $5,936

2040 58.6 $1,615 $4,614 $6,459

Total 408.2 $10,040 $29,975 $42,553

The cumulative WTW GHG emissions reductions along with the estimated benefits range from

about $10.9 billion to $46.0 billion through 2040, depending on the chosen discount rate.

180

6. Reason for Rejection for Alternatives

Alternative 1 is rejected because it fails to maximize the number of ZEVs deployed, and does

not maximize NOx, PM

2.5

, and GHG reductions. The benefit to cost ratio for this alternative is

better, however, it gets less emission benefits than the proposal. The Proposed ACC II

Regulation is identified as a measure in the State SIP Strategy as well as part of the Climate

Change Scoping Plan as a necessary component needed to improve California’s air quality

consistent with federal and state legal requirements and achieve the state’s climate

protection goals. Alternative 1 does not maximize the number of ZEVs deployed in California

as it requires a lower number of ZEVs to be produced. This would likely delay the spread of

zero-emission technology to other sectors because it would stifle maturation of the

technology, delay associated cost reductions, and delay deployment of charging

infrastructure from stunted demand. Because of the low number of vehicles deployed and its

attendant effects, Alternative 1 does not maximize NOx and PM

2.5

emission reductions from

the transportation sector which are necessary to meet SIP attainment goals. Alternative 1

also does not reduce GHG emissions, failing to meet the goals of the Climate Change

Scoping Plan.

Alternative 2 is rejected as the more aggressive early requirements would require tripling of

the ZEV market in California in the next 3 model years, as model years 2022 and 2023 are

fully planned. This kind of market growth is unprecedented, and there is a lack of evidence as

to how to prove a feasible path for manufacturers to comply even in the first model year of

this alternative.

B. Small Business Alternative

The Board has not identified any reasonable alternatives that would lessen any adverse

impact of the Advanced Clean Cars II proposal on small business. The proposed LEV

regulations do not apply directly to small businesses.

The decreasing trend in demand for gasoline has the potential to result in the elimination of

businesses in this industry and downstream industries, such as gasoline stations and vehicle

repair businesses, if sustained over time, unless they adapt and provide charging and repair

services for ZEVs that enable them to continue offering other services to drivers, such as

convenience foods, that tend to be their profit centers. As ZEVs become a greater portion of

the fleet, the vehicle repair and maintenance service industry are estimated to see negative

impacts, including dealerships that have service departments, due to the lower maintenance

requirements for ZEVs compared with ICEVs. This trend would suggest that the number of

businesses providing the services may decrease along with the reduced demand.

Staff is proposing changes to the California Service Information Regulation, California Code

of Regulations, section 1969, explained in further detail in Section III.C.4. Changes to this

regulation are expected to increase participation of small independent repair shops in the

transition to ZEV technologies due to the fact that these repair shops will now be guaranteed

access to repair information for ZEVs.

C. Performance Standards in Place of Prescriptive Standards

Government Code section 11346.2(b)(4)(A) requires that when CARB proposes a regulation

that would mandate the use of specific technologies or equipment, or prescribe specific

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actions or procedures, it must consider performance standards as an alternative. The

Proposed ACC II Regulation, consisting of the proposed LEV IV regulation and the proposed

ZEV regulation, is a performance standard. For the proposed LEV IV regulation, no specific

technology is mandated. The regulation sets a performance standard that does not define

the sole or any specific means of compliance and that can be feasibly met with a variety of

technologies in a cost-effective way, as the analysis here shows. The proposed ZEV

regulation does not prescribe one specific technology or one specific avenue for compliance;

rather, manufacturers can meet this proposed regulation requirements using BEV, PHEV or

FCEV technologies and with several options for securing ZEV values. The proposed

regulations encourage innovation by allowing manufacturers to determine the most cost-

effective means of compliance.

Even if the Proposed ACC II Regulation were considered to be a prescriptive standard, to the

extent it establishes specific measurements, actions, or quantifiable means of limiting

emissions or producing ZEVs, it would still be preferred over other performance-based

alternatives. Anything less prescriptive than ACC II in terms of emission limits and

requirements for ZEVs erodes the proposal’s ability to secure the emissions reductions

needed for meeting California’s public health and climate goals and State and federal air

quality standards because. Less prescriptive measures would allow, by omission, additional

flexibilities on technology, valuation, fleet mixing, and assurance measures that would likely

not achieve the same magnitude of emissions reductions or support for the ZEV market.

More performance-based alternatives would thus undermine the goals of this action.

D. Health and Safety Code section 57005 Major Regulation Alternatives

CARB estimates the proposed regulation will have an economic impact on the state’s

business enterprises of more than $10 million in one or more years of implementation. CARB

will evaluate alternatives submitted to CARB and considered whether there is a less costly

alternative or combination of alternatives that would be equally as effective in achieving

increments of environmental protection in full compliance with statutory mandates within the

same amount of time as the proposed regulatory requirements, as required by Health and

Safety Code section 57005.

XII. Justification for Adoption of Regulations Different from

Federal Regulations Contained in the Code of Federal Regulations

The proposed regulations address two aspects of motor vehicle emissions, one for exhaust

emissions from conventional vehicles and another for zero-emission vehicles. They do not

duplicate or conflict with federal regulations that address the same issues, and to the extent

they are different from existing federal regulations they are authorized by law and are

justified by their benefits to human health, public welfare, and the environment.

Currently, California’s LEV III and U.S. EPA’s Tier 3 vehicle emission standards and other

emission-related requirements have largely been harmonized, to enable the regulated

industry to design and produce a single product line of vehicles that can be certified to both

U.S. EPA and CARB emission standards and sold in all 50 states.

However, as discussed in Chapter IV, the LEV III and Tier 3 vehicle emission standards do not

adequately reduce excess emissions that occur during real world driving conditions or

prevent backsliding of emissions from ICEVs as the fleet transitions to ZEVs. The proposed

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LEV IV regulations focus on achieving additional control of emissions from light- and medium-

duty vehicles under real world driving conditions.

The proposed LEV IV regulations control emissions of criteria pollutants from the exhaust of

conventional motor vehicles. They would apply to vehicles delivered for sale in California

beginning with the 2026 model year. They are more stringent than the existing federal Tier 3

standards for the same pollutants from motor vehicles for the 2025 and subsequent model

years that were set by the U.S. Environmental Protection Agency (U.S. EPA). (Cf. Control of

Air Pollution From Motor Vehicles: Tier 3 Motor Vehicle Emission and Fuel Standards, 79 Fed.

Reg. 23,414, 23,417, April 28, 2014 [federal Tier 3 standards are harmonized with CARB’s

current LEV III standards through model year 2025]; 40 C.F.R. § 86.1811-17.) Thus, vehicles

that comply with CARB’s proposed standards will comply with federal emission standards.

This does not present a conflict with federal regulations because CARB’s standards may be

more stringent than federal standards, under a provision in the Clean Air Act that directs the

Administrator of the U.S. EPA to waive federal preemption of California’s motor vehicle

emission standards when they meet the listed criteria, which have been met here. (Clean Air

Act, § 209(b), 42 U.S.C. § 7543(b).) Moreover, under that provision vehicles that comply with

CARB’s standards are deemed to comply with federal standards for the same pollutants.

(Clean Air Act, § 209(b)(3), 42 U.S.C. § 7543(b)(3).)

The proposed ZEV regulations would require manufacturers to deliver for sale increasing

percentages of ZEVs as a portion of their overall product deliveries between model years

2026 and 2035 (and after). There are no comparable federal standards for sales of zero-

emission vehicles. Federal and state regulations for greenhouse gas emissions from

manufacturers’ fleets of motor vehicles allow manufacturers to get credit for the lack of

exhaust emissions from ZEVs when determining compliance. (Cal. Code Regs., tit. 13, §

1961.3; 40 C.F.R. §§ 86.1818-12 [emission standards]; 86.1866-12 [value for ZEVs].) The ZEV

regulation will facilitate compliance with federal and state greenhouse gas emission

standards.

To the extent that California’s proposed LEV IV regulations differ from current federal Tier 3

regulations for the same pollutants and sources, or that the proposed ZEV regulations differ

from either the current federal Tier 3 regulations or greenhouse gas emission standards,

CARB has authority under state and federal law to set California’s own standards to reduce

emissions from motor vehicles to meet federal and state ambient air quality standards and

climate change requirements and goals. It also has authority to require additional and

separate reporting than required under federal law. California has plenary authority under

the state and federal constitutions to protect public health and welfare. The California Health

and Safety Code directs CARB to exercise this authority to reduce and eliminate harmful

emissions from motor vehicles. These statutory obligations are identified in the authority

citations for the proposed regulations. The federal Clean Air Act directs the Administrator of

the U.S. EPA to exempt California’s motor vehicle emission standards from federal

preemption when they meet the listed criteria, which have been met here. (Clean Air Act, §

209(b), 42 U.S.C. § 7543(b).)

As shown in this staff report and accompanying analyses, the cost of the state regulations is

justified by the substantial additional benefits to human health, public welfare, and the

environment described above and in the accompanying materials. The proposed regulations

will provide significant benefits for all these factors. They will reduce emissions harmful to

human health and the environment. The value of the benefits outweighs the costs. The

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regulations will reduce overall costs for transportation. These improvements and savings will

improve the public welfare.

XIII. Public Process for Development of the Proposed Action

Consistent with the Board’s long-standing practice, staff have engaged in an extensive public

process in developing the Proposed Regulation. Staff sought input from stakeholders

through various outreach and engagement events, including public workshops, stakeholder

working groups, informal meetings and phone calls, and a community listening session. Staff

conducted meetings with manufacturers and component suppliers, environmental and equity

advocacy organizations, community-based organizations, and other interested stakeholders.

These informal pre-rulemaking discussions provided staff with useful information, particularly

on the ZEV regulatory stringency, incremental vehicle costs, and battery lifetime

performance, that was considered during development of the Proposal.

CARB staff conducted four virtual public workshops to discuss regulatory concepts and to

solicit feedback on various elements of the proposals and analyses, including feedback on

the CEQA scope, alternatives to evaluate, and the data and methods used to develop cost

impacts. Staff notified stakeholders of all workshops via email distribution of a public notice

at least two weeks prior to their occurrence. These notices were posted to the program’s

website and distributed through several public list serves. The public workshops were open

to all members of the public. The workshops discussed all aspects of the proposals, including

the benefits of the regulations on the “communities in California with the most significant

exposure to air contaminants.”

436

Meeting materials, including slide presentations, cost

workbooks, draft regulatory documents, and event recordings, were posted and available to

the public. Staff solicited for regulatory alternatives and comments on the scope of the

environmental analysis at the August 11, 2021 public workshop. Recordings of the workshops

were posted online and remain available for public viewing. A complete listing of previously

held public outreach events appears in Table XIII-1.

436

Health & Saf. Code, § 43018.5, subd. (c)(4).

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Table XIII-1. Dates and Objectives for Public Events held Previously

Date Event Objective

September 16,

2020

Public Workshop 1

To present preliminary analyses and concepts for the

LEV criteria pollutant regulation, measures to support

wide-scale adoption of new ZEVs, and projections of

costs for battery electric vehicles.

May 6, 2021 Public Workshop 2

To present updated proposals for the LEV criteria

regulation, the post-2025 ZEV regulation, and ZEV

assurance measures, and projections of costs for ZEV

technologies.

June 29, 2021 Listening Session

To inform community members about what the State is

doing to increase equitable access to clean

transportation through the ACC II regulations and other

programs, and to listen to community questions,

thoughts, experiences, and suggestions.

August 11, 2021 Public Workshop 3

To provide updates on minimum technology

requirements for ZEVs, to present new measures to

increase access to ZEVs for priority communities, (i.e.,

disadvantaged communities, low-income communities,

tribal communities, and low-income households), and

to solicit for regulatory alternatives. This workshop also

served as a California Environmental Quality Act

(CEQA) scoping meeting.

October 13, 2021

Public Workshop 4

To present updated proposals for the LEV criteria

regulation, ZEV regulation, and ZEV assurance

measures. To also present statewide costs and emission

benefits for the full regulation proposal and two

alternatives considered.

Starting in 2020, many meetings and public events were held using remote formats such as

webinars and videoconferences.

437

CARB staff virtually attended and presented at several

community meetings of residents to communicate regulatory proposals and solicit input.

437

Virtual workshops meet multiple public participation goals and statutory requirements. Assembly Bill 361,

stats. 2021, ch. 165, sec. 2, added Government Code, section 11133, that allows state bodies, including CARB,

to conduct public meetings remotely through January 31, 2022. This statute furthered the allowances in the

Governor’s Executive Orders N-29-20, N-08-21, and N-15-21 to allow state agencies to hold public workshops

and meetings by teleconference during the COVID-19 public health emergency. As the Legislature recognized

in AB 361, a virtual or remote workshop is many ways more accessible than a physical location. It can be

attended by anyone from anywhere with internet service and a device. Holding remote workshops furthers the

Legislature’s intent to make the proceedings more widely available than the default and vague requirement to

“involve parties who would be subject to the proposed regulations in public discussions regarding those

proposed regulations” in Government Code, section 11346.45. CARB received no adverse comment on the

format or number of workshops.

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These meetings included environmental justice advocacy organizations and community-

based organizations. Furthermore, all public workshops and a community listening session

were held virtually to solicit comments on the proposed regulations under development.

Virtual or remote workshops and meetings are in many ways more accessible than a physical

location, as they can be attended by anyone from anywhere with internet service or a cellular

device. Holding remote workshops can help make events more widely available than merely

involving parties who would be subject to the proposed regulations.

These informal pre-rulemaking engagement events and discussions provided staff with useful

information that was considered during development of the Proposed Regulation and the

impact assessment. CARB solicited informal public comment following each workshop;

stakeholders submitted 36 comments, which CARB has both considered and posted

online.

438

CARB staff posted cost workbooks detailing cost data and the assumptions and

methods used for determining incremental costs of ZEV technologies. Stakeholders provided

input on various cost elements, such as battery costs, component costs, vehicle range

assumptions, and vehicle design assumptions. This specific cost feedback, in addition to

input from stakeholders in other forums, helped shape the data, methods, and assumptions

for the impact assessment. Public input was also considered in determining regulatory

alternatives for the Proposed Regulation. Staff will continue to engage stakeholders

throughout the development of this regulation.

439

XIV. Next Steps

California’s ZEV regulation is one piece of the overarching strategy across state agencies to

electrify passenger vehicles. Transforming to a zero-emission transportation system equitably

requires a coordinated, collaborative, and cross-cutting approach. Although outside the

scope of this rulemaking, a comprehensive set of complementary programs and policies are

being implemented by many state agencies to address what is needed for a successful ZEV

market, led by the GoBiz ZEV Market Development Strategy, and CARB intends to continue

engaging in these efforts. As noted earlier, these actions include agency collaboration and

investments to address ZEV fueling infrastructure, consumer outreach and education, and

incentives for vehicles and fuel. These supporting programs work together to accelerate the

ZEV market by fostering vehicle demand which leads to cost reductions across all phases of

ZEV technology commercialization and market development. With this suite of policy actions

the state will be ready for the rapidly growing ZEV market.

438

CARB 2022h. Workshop Comments Log. California Air Resources Board.

https://www.arb.ca.gov/lispub/comm2/bccommlog.php?listname=accii-comments-w3-ws. Accessed March 11,

2022.

439

Health and Safety Code section 38564 requires CARB to consult with other states and nations and the

federal government to identify the most effective strategies and methods to reduce GHGs and develop

integrated, cost-effective control programs. Staff has engaged with other states throughout the rulemaking

development and even had representatives from two Section 177 states present at our October 2021

workshop. Staff also have robust routine engagement with the federal EPA, as well as with other nations

through the International ZEV Alliance and direct engagement with Environment and Climate Change Canada.

Additionally, staff participate in international committees and work groups developing protocols and best

practices for ZEVs and batteries.

186

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