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Cost-benefit analysis of Brazil's heavy-duty emission standards (P-8)

Published Tue, 2016.03.01 | By

Joshua Miller, Cristiano Façanha

Summary

P-8 standards in Brazil are a highly cost-effective means of reducing the environmental impact of diesel HDVs in Brazil and timely action is of critical importance.


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Brazil has controlled heavy-duty vehicle (HDV) emissions through the Programa de Controle da Poluição do Ar por Veículos Automotores (PROCONVE) since 1990, following the European precedent for emission limits and certification test procedures. Brazilian implementation has been an average of 5 years behind Europe with the most recent implementation in 2012 being PROCONVE P-7, which is equivalent to Euro V standards. Despite the many PROCONVE phases to date, air pollution in major metropolitan areas in Brazil is still far above the levels recommended by the World Health Organization (WHO). 

In order to mitigate air quality problems and keep pace with vehicle technology progress worldwide, future PROCONVE phases are necessary. In addition to more stringent emission limits, advancing to the Euro VI-equivalent P-8 phase will significantly strengthen the regulatory program, including moving to more representative test cycles; requiring advanced on-board diagnostics (OBD) and fail-safes to ensure proper use and functioning of SCR systems; and establishing in-use conformity requirements. These improvements will ensure that P-8 achieves the expected reduction in emissions in the real world and not just in the laboratory. 
 
This analysis concludes that P-8 standards in Brazil are a highly cost-effective means of reducing the environmental impact of diesel HDVs in Brazil. Over a 30-year period beginning in 2018, P-8 standards would result in health benefits valued at $74 billion at a cost of $7 billion, with a benefit-cost ratio of 11:1. This is in line with international findings of cost-benefit analyses for similar HDV emission standards, with a range of 11:1 for Mexico to 16:1 for the U.S. Although manufacturers are expected to incur average incremental technology costs of $2,460 per vehicle, P-8 standards are not expected to increase fueling costs compared to the current standard because P-7 vehicles already use ULSD and DEF. Over the same time period, the cumulative benefits of P-8 standards include the prevention of 74,000 early deaths from exposure to fine particle emissions (PM2.5) in urban areas, in addition to much lower NOX and black carbon emissions. Each year of delay in the implementation of P-8 standards beyond 2018 could result in an additional 2,500 premature deaths, highlighting the critical importance of timely action.