The U.S. EPA has proposed Tier 3 emission standards for cars and gasoline. The new goals for lower sulfur content got the attention in the first days after the release of the proposed rules, but for the ethanol industry the news is in the details of the proposed Tier 3 rules.

The new rules begin with the assumption that E10 has become the norm and E15 will become prevalent in the future. In the preamble, the document explains that the emissions reductions are estimated with the assumption of a partial implementation of the renewable fuels standard by 2017 and full implementation in 2022 and beyond, “reflecting a mix of E10 and E15 in 2017 and E15 only in 2030.” 

Perhaps the biggest proposed change is that the test fuel used by auto manufacturers to determine emissions move away from indolene (E0) to E15. The EPA explains that it is “proposing to update our federal emissions test fuel to better match today’s in-use gasoline and also to be forward-looking with respect to future ethanol and sulfur content.” The proposed rules would lower the octane to match regular-grade gasoline, except for premium-required vehicles, adjust distillation temperatures, aromatics and olefins to “better match today’s in-use fuel and to be consistent with anticipated E15 composition.” The new-fuel requirement would apply beginning with model year 2017, although the EPA suggests a phasing in of the rule that would end after model year 2019.

In addition to proposing a new E15 emissions test fuel, the EPA is proposing detailed specifications for an E85 emissions test fuel to be used for flex-fuel vehicle certification. The agency is also proposing to allow vehicle manufacturers to request approval for an alternative certification fuel, specifically mentioning E30. “This could help manufacturers that wish to raise compression ratios to improve vehicle efficiency, as a step toward complying with the 2017 and later light-duty greenhouse gas and CAFE standards,” the proposed rule states. “This in turn could help provide a market incentive to increase ethanol use beyond E10 by overcoming the disincentive of lower fuel economy associated with increasing ethanol concentrations in fuel, and enhance the environmental performance.”  

In announcing the Tier 3 proposal, the EPA touted the benefits of the stiffer rules. “These cleaner fuels and cars standards are an important component of the administration’s national program for clean cars and trucks, which also include historic fuel efficiency standards that are saving new vehicle owners at the gas pump today,” the EPA said in announcing the proposed rules. “Once fully in place, the standards will help avoid up to 2,400 premature deaths per year and 23,000 cases of respiratory ailments in children.”

The proposal will slash emissions of a range of harmful pollutants that can cause premature death and respiratory illnesses, according to the EPA, including reducing smog-forming volatile organic compounds and nitrogen oxides by 80 percent, establish a 70 percent tighter particulate matter standard, and reduce fuel vapor emissions to near zero. The proposal will also reduce vehicle emissions of toxic air pollutants, such as benzene and 1,3-butadiene, by up to 40 percent.

The proposed standards will reduce gasoline sulfur levels by more than 60 percent – down to 10 parts per million (ppm) in 2017. Reducing sulfur in gasoline enables vehicle emission control technologies to perform more efficiently. This means that vehicles built prior to the proposed standards will run cleaner on the new low-sulfur gas, providing significant and immediate benefits by reducing emissions from every gas-powered vehicle on the road.

The proposed EPA standards are coordinated with California’s clean cars and fuels program to create a harmonized nationwide vehicle emissions program that enables automakers to sell the same vehicles in all 50 states. The proposal is designed to be implemented over the same timeframe as the next phase of EPA’s national program to reduce greenhouse gas (GHG) emissions from cars and light trucks beginning in model year 2017. Together, the federal and California standards will maximize reductions in GHGs, air pollutants and air toxics from cars and light trucks while providing automakers regulatory certainty and streamlining compliance.

The EPA estimates the proposed rules will provide up to $7 in health benefits for every dollar spent to meet the standards. The proposed sulfur standards will cost refineries less than a penny per gallon of gasoline on average once the standards are fully in place. The proposed vehicle standards will have an average cost of about $130 per vehicle in 2025. The proposal also includes flexibilities for small businesses, including hardship provisions and additional lead time for compliance.

Once published in the Federal Register, the proposal will be available for public comment and EPA will hold public hearings to receive further public input.