New thinking on natural gas trucks from the National Research Council

In case you missed it, the National Research Council just weighed in on a few hot items related to the in-development “Phase II” heavy-duty vehicle efficiency standards for 2019+ trucks. The NRC is convening a committee of experts, that, in this latest report, didn’t bother shying away from two of the more intriguing topics – trailers and natural gas. Our resident trailer expert, Ben Sharpe, just provided a few reflections on the NRC’s trailer findings. I focus a few quick observations here on the NRC’s stance on regulating natural gas trucks.

There is no doubt that natural gas trucks have seen an impressive rise (primarily in refuse trucks and buses), offer dramatic per-mile fuel cost savings over diesel, and promise lower pollutant emissions [.pdf]. Yet natural gas vehicles still represent just 1% of overall US truck sales and in-use fleet (and far less for passenger cars). One lingering question is about whether they will bring climate emission benefits [.pdf], due to their leaky natural gas supply chain (i.e., with fugitive and vented emissions throughout the production, transport, distribution, refueling, and storage). Thankfully, the Obama Administration appears to have a plan to address [.pdf] the upstream gas leaks. The NRC recognizes these factors in recommending that the regulatory agencies, NHTSA and EPA, develop a separate standard for natural gas vehicles (rather than regulate them within the same performance standards as gasoline and diesel), and that the agencies should develop a best estimate of well-to-wheel emissions including upstream gas leakage for context for developing future rulemakings.

Now these positions by the NRC are intriguing for several reasons. First of all, the committee is making a rather novel recommendation, “NHTSA and EPA should develop a separate standard for NG vehicles,” instead of suggesting how the agencies should analyze or consider the relative merits of separate regulation for the emerging fuel. This special call-out for natural gas-specific vehicle standards does not, as far as we know at the ICCT, have any precedent globally in any vehicle greenhouse gas emission or efficiency regulation. In fact, it’s generally considered a foundational best practice [.pdf] that regulations promoting low emission and high-efficiency technologies should be fuel neutral.

Also, this NRC committee position on natural gas truck regulation indirectly dives into another very lively debate about whether gasoline and diesel trucks should be regulated together in fuel-neutral standards, or separately. Major manufacturers and other key industry stakeholders (e.g., UPS, Daimler, Cummins, National Automobile Dealers Association, Engine Manufacturers and Truck Manufacturers Associations, Motor & Equipment Manufacturers Association, Truck Renting and Leasing Association, and American Council for an Energy-Efficient Economy) expressed differing views [.pdf] from the decision by EPA and NHTSA to adopt separate regulations for gasoline and diesel trucks and engines [.pdf]. The existing “Phase 1” standards for 2014-2018 trucks allow gasoline vehicles to meet a more lenient standard for a given utility level than diesel trucks. The agencies noted that fuel-neutral performance standards “are generally preferable” and they “are not committed to perpetuating separate GHG standards for gasoline and diesel heavy-duty vehicles and engines, and expect to reexamine the need for separate gasoline/diesel standards in the next rulemaking.”

The NRC report doesn’t spell out the regulatory implications of its recommendation for the EPA and NHTSA as they work toward new truck standards for the 2025 timeframe. Pragmatically, the agencies will have four options if they were to contemplate the possible development of separate natural gas vehicle standards:

  1. Set separate natural gas standards that are more stringent than the diesel/gasoline standards. This regulatory decision would make it harder for natural gas vehicles to compete in the market place.
  2. Set natural gas standards that are separate but equal to the diesel/gasoline standards. This would effectively protect natural gas, gasoline, and diesel vehicles from competing against each other on their efficiency and carbon emissions, and thereby take away any direct regulatory incentive to shift from gasoline/diesel to natural gas vehicles.
  3. Set separate natural gas standards that are less stringent than the diesel/gasoline standards. This approach provides preferential environmental treatment for natural gas vehicles that do the same work functions as gasoline/diesel vehicles.
  4. Set separate natural gas standards with test procedures that are sufficiently different. This approach would make it so nobody would be able to compare whether the standards are more or less stringent, even for comparable gasoline/diesel vehicles with the same functions.

The alternative to setting separate natural gas standards is for the agencies to incorporate natural gas vehicles in the same technology-neutral performance standards as gasoline and diesel. Such a fuel-neutral regulatory playing field would allow the technologies to freely compete based on their greenhouse gas emissions, efficiency, and cost-effectiveness This would help ensure the full promotion and improvement of the leading low-emission vehicle technologies.