Worldwide Emission Standards and Related Regulations Passenger Cars / Light and Medium Duty Vehicles May 2019 www.continental-automotive.com Powertrain Important Developments European Union Important developments and phase-in of new regulations are ongoing in several areas: • Reduction of greenhouse gases • Reduction of pollutant emissions • Revision of type approval framework Reduction of greenhouse gases: The European Union maintains its focus on achieving the Greenhouse Gas emission reductions planned for the second commitment period of the Kyoto protocol for 2013 to 2020 with the target to achieve in 2020 20% of GHG reduction compared to the base year 1990. For the following years, the European Union committed within the Paris agreement (COP21) to a GHG reduction target for the period from 2021 to 2030. The commitment for 2030 is a reduction of 40% of GHG emissions compared to 1990, Figure 1. Finally, for 2050 the European Union set itself a target of net-zero greenhouse gas emissions. The road transport sector has a big part in the European energy consumption, representative for the CO2 emission share for non-regenerative energies, Figure 2. Therefore, the EU continues to tighten the CO2 emission limits for passenger cars and light commercial vehicles. The evolution of the CO2 regulation remains the main driver for changes in vehicle technology. The need for greenhouse Gaz neutral powertrains drives the electrified architectures and the search for realistic solutions for alternative, low-carbon fuels. Figure 1: Main UN agreements driving the EU CO2 emission policy 1 Figure 2: Importance of the road transport sector in terms of energy consumption The high-level European targets are translated into EU regulations for passenger cars and LCV: • The European CO2 emissions target for 2020/2021 was defined in 2014 as Regulation (EU) No 333/2014 for passenger cars and Regulation EU 253/2014 for LCV. The regulations foresee for passenger cars a phase-in of the 95 gCO2/km target based on the NEDC test procedure during the years 2020 and 2021 allowing to discard the 5% most emitting vehicles during the first year. For LCV the target of 147 gCO2/km is defined for 2020. • It is recognized that the NEDC test-procedure does not provide CO2 emission data characteristic for real driving. For this reason, the EU Commission introduced the new WLTP into the European legislation. The new regulation 2017/1151 replacing the EU regulation 692 was published in June 2017. Phase-in is going on for passenger cars and light commercial vehicles. Application started with passenger car Type Approval in September 2017 and will be finalized with the application for all new LCV in September 2019. • The CO2 emissions measured using the WLTP must be converted to a NEDC basis until 2020 to be compared to the CO2 emission target values defined for the NEDC (130 gCO2/km until 2019 and 95 gCO2/km starting 2020). Based on this correlation method and the actual fleet performance in 2020, OEM specific WLTP based CO2 targets will be defined for the period starting 2021. • The CO2 emission targets for 2025 and 2030 were voted by the European council and parliament and will be published in the official journal before mid-2019. CO2 reduction target for 2025 is -15% compared to 2021 for passenger cars and LCV. For 2030 the targets compared to the 2021 baseline are -37.5% for passenger cars and -31% for LCV. 2 Reduction of pollutant emissions: A second priority is defined by the European Clean Air policy. Air quality standards are still exceeded in many main European cities. Passenger cars and light duty commercial vehicles are contributing mainly to NOx and fine particle emissions. The fact that especially Diesel vehicles emitted in the past under real driving conditions more NOx than under type approval conditions had triggered the introduction of the new real driving emission type approval test as part of regulation EU 2017/1151. This regulation will mainly affect Diesel engine calibration and aftertreatment, but also PN emission reduction technology and NOx emissions for gasoline vehicles, especially GDI engines. Regulatory work in the field of pollutant emissions is proceeding on the following subjects: • A first change in the area of pollutant emissions will be the switch from the NEDC to the WLTP test procedure without change of the EU6 emission limits, introduced in September 2017 for Type Approval. • The main change is the new type approval test addressing the pollutant emissions of light duty vehicles under realistic driving conditions not covered by the NEDC nor by the WLTP. Main target are the NOx emissions of Diesel cars and PN emissions from Gasoline Direct Injection vehicles. To avoid optimization of pollutant control devices for a specific cycle – even the more realistic WLTP – a randomization of the test conditions was considered necessary. The new Real Driving Emissions (RDE) test procedure is based on Portable Emission Measurement Systems (PEMS) and driving on public roads. PEMS based emission limits will be applied for NOx and for PN (CO only for monitoring). HC emissions are not included in the RDE test procedure. The cold start phase is included in the test. The RDE test procedure is included as ANNEX IIIA in the new regulation EU 2017/1151 which was published in several packages since June 2017. The latest part is the 4th package of the RDE regulation published as regulation EU 2018/1832. It contains a revised data processing methodology, provisions for In-service conformity control based on RDE, updates for hybrid vehicles a revised EVAP procedure and provisions for the on-board fuel and electrical energy consumption metering (OBFCM). The phase-in is scheduled in several steps for passenger cars and LCV between September 2017 and January 2022. • For the period after 2022 discussion for a post Euro6 regulation have started with first stake- holder meetings in 2018. Two external studies were launched by the EU Commission and formal working group should start second half of 2019. New type approval legislation The Council adopted on May 25th, 2018 a regulation to reform the type-approval and market surveillance system for motor vehicles in the EU. This major reform modernizes the current system and improves the control of car emissions. The final act was published as Regulation (EU) 2018/858 in the Official Journal on June 14th, 2018. The new type approval regulation is mandatory from 1 September 2020. It important to note that up to now the type approval is regulated by a directive (2007/46/EC), 3 meaning that the detailed legislation is done under member state responsibility. The new type approval legislation directly rules on EU level. The original proposals to create a member-state independent EU agency and modify the remuneration system to avoid that technical services are paid by the manufacturer were rejected by the council. Nevertheless, in the future, the EU Commissions will be able to audit technical services and national type approval authorities to ensure that regulations are implemented and enforced rigorously in all member states. Also, Peer reviews between technical services are possible. A market survey system will be introduced which allows member-states to challenge certifications given by other member-states. In addition, the Commission will carry out market checks independently from Member States and will have the possibility to initiate EU-wide recalls. The type approval regulation concerns all M and N type vehicles as well as the trailers of type O (Light Duty and Heavy Duty). It does not apply to agricultural or forestry vehicles and two- or three- wheel vehicles and quadricycles. 4 USA - Federal • On April 2, 2018, the EPA Administrator signed the Mid-term Evaluation Final Determination which finds that the model year 2022-2025 greenhouse gas standards are not appropriate and, therefore, should be revised. • NHTSA and the EPA are proposing the “Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule for Model Years 2021-2026 Passenger Cars and Light Trucks” (SAFE Vehicles Rule). The SAFE Vehicles Rule, if finalized, will establish new standards for Corporate Average Fuel Economy (CAFE) and tailpipe Green House Gas (GHG) emission standards for passenger cars and light trucks covering model years 2021 through 2026. • More specifically, NHTSA is proposing new CAFE standards for model years 2022 through 2026 and amending its 2021 model year CAFE standards because they are no longer maximum feasible standards, and EPA is proposing to amend its carbon dioxide emissions standards for model years 2021 through 2025 because they are no longer appropriate and reasonable in addition to establishing new standards for model year 2026. • Additionally, the EPA is proposing to withdraw California’s waiver from the federal Clean Air Act (CAA). The CAA prohibits individual states from enacting emission standards for new motor vehicles. • California is specially empowered to apply for a waiver from this preemption, and EPA grants it unless specific blocking conditions are triggered. • The 2013, waiver of CAA preemption applies to California’s Advanced Clean Car (ACC) program, Zero Emissions Vehicle (ZEV) mandate, and Greenhouse Gas (GHG) standards that are applicable to model years 2021 through 2025. • Twelve states and the District of Columbia have adopted California's LEV III greenhouse gas emission standards pursuant to Section 177 of the federal Clean Air Act: New York, Massachusetts, Vermont, Maine, Pennsylvania, Connecticut, Rhode Island, Washington, Maryland, Oregon, New Jersey, and Delaware. • EPA states California’s GHG and ZEV standards are inconsistent with the regulations because they are technologically infeasible because they provide insufficient lead time to permit the development of necessary technology, giving appropriate consideration to compliance costs. • US-EPA Tier 3 Motor Vehicle Emission and Fuel Standards. Starting in 2017, Tier 3 set new vehicle emissions standards and lowers the sulfur content of gasoline, considering the vehicle and its fuel as an integrated system.