by Erin Voegele (Ethanol Producer Magazine)  The U.S. EPA and U.S. Department of Transportation finalized new fuel efficiency standards on Aug. 28. The new corporate average fuel economy (CAFE) standards will increase fuel economy to the equivalent of 54.5 mpg for cars and light-duty trucks by model year (MY) 2025.

…According to the rulemaking, the Clean Fuels Development Coalition, Growth Energy, the 25x’25 Alliance, Volkswagen and the Association of Global Automakers recommended that the EPA provide GHG incentives to automakers that produce vehicles capable of operating on biofuels beyond MY 2015, when incentives under the light-duty vehicle GHG program are set to expire. In its response, the EPA said that it recognizes that the use of certain biofuels has the potential to reduce lifecycle GHG emissions, but that it also recognizes that other programs already either require increased use of biofuels or provide incentives for vehicle manufacturers to produce vehicles capable of operating on more than one fuel. “In that context, EPA believes it is not appropriate to adopt incentive multipliers, or the 0.15 divisor, in this rule for manufacturers of biofuel-capable vehicles,” said the EPA in the rule. “The tailpipe GHG emissions of biofuel-capable vehicles when operated on biofuels are typically slightly lower than GHG emissions from conventional vehicles, and those GHG emissions performance-based reductions would be accounted for in EPA compliance calculations based on the actual use of biofuels. On the other hand, biofuels-capable vehicles are typically no more expensive than conventional vehicles, they may or may not use a biofuel (since they can operate on conventional fuel), and they do not face significant consumer acceptance barriers since they can, and most often are, operated on fuels with high gasoline content.”

The EPA also noted that several commenters pointed out that cellulosic biofuels have the potential to yield large GHG emissions savings, and recommended that those fuels be given credit to reflect the resulting GHG benefits. In its response, the EPA said that the use of low-GHG biofuels is already required under the renewable fuel standard (RFS), and that it has already quantified the GHG emissions benefits associated with the RFS program. “Providing an additional incentive in the MYs 2017-2025 GHG program, which is focused on vehicle tailpipe emissions and not lifecycle emissions, would not achieve any greater use of renewable fuels than is already required under the RFS program, and thus would not achieve any greater emissions reductions from the use of such fuel,” said the EPA. “Thus, providing an additional incentive would only lead to a reduction in the emissions benefits of the MYs 2017-2025 light-duty vehicle GHG emissions program. Given that renewable fuel use is already required by and accounted for under the RFS program, it therefore would be inappropriate to provide additional incentives in the MYs 2017-2025 program.”

Several commenters also said that not providing incentives for ethanol or biofuel vehicles creates a rule that is inconsistent with the RFS and would make the volume requirements of the RFS unachievable.  READ MORE