International Experience and Trends: Vehicle fuel economy and CO2 measurement

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1 International Experience and Trends: Vehicle fuel economy and CO2 measurement Stuart Rayner: National Association of Automobile Manufacturers of South Africa/Ford Motor Company: July 2013

2 Presentation sections Fuel economy measurement and European CO2 emission reductions and plans USA: Corporate Average Fuel Economy (CAFE) and technology trends Vehicle Technology trends South Africa Example: Vehicle emission and fuel standards: Actual and legislated. SA Department of Energy fuel economy labeling SA National Treasury CO2 vehicle taxation Potential improvements to new vehicle fuel economy and CO2 emissions Summary

3 Science Stabilizing Atmospheric CO 2 Levels 3

4 European new passenger car fleet CO2 legislation 130 gr/km average by 2015 progressive intro from gr/km average by 2020 subject to 2013 review. Waver for sub 10,000 units pa and special arrangements for sub 300,000 units manufacturers. Not initially applied to light commercial vehicles. Results in an effective 19% decrease in C02 emissions for all vehicles compared to current fleet. Implications for African markets?

5 Emission/CO2 Testing Facilities Slide: Ford Motor Company

6 Typical Light Duty Vehicle Test Facility speed vs. time Power Absorption Unit Dilution Air Inertia Wheels Measurements in g/km, mg/km or #/km Regulations ECE-83 or 715/2007/EC Constant Volume Sampling (CVS) System Bag Samples to emissions analyzers

7 Emissions Test Cell Small vehicles only ( Fully Laden < 3.5 t). Multi million dollar investments On-going calibration / correlation / maintenance requirements to maintain accuracy, precision and reliability Highly skilled operators required Ford Motor Company

8 speed (kph) New European Driving cycle (NEDC) New European Emissions / CO2 Cycle applied from year Excellent for repeatability and assessment against legislative standards New European Driving Cycle (NEDC) Speed / time trace 120 kph Recognised by both Industry and Legislators for some time as not representative of real driving Start of measurement Single Urban Drive Cycle 195 seconds Extre Urban Drive Cycle 400 seconds NEDC not only used in Europe but Mauritius / India / China / Russia / S Africa and many parts of South America time (s) 23 January 2014 Slide:Ford Motor Company

9 Vehicle Definitions - Category M (Passenger) Fuel Economy/CO2 limits applied to M1 only Category M: Motor vehicles having at least four wheels, or having three wheels when the maximum weight exceeds 1 metric ton, and used for the carriage of passengers. M1: Vehicles used for the carriage of passengers and comprising no more than eight seats in addition to the driver's seat. M2: Vehicles used for the carriage of passengers, comprising more than eight seats in addition to the driver's seat, and having a maximum weight not exceeding 5 metric tons. M3: Vehicles used for the carriage of passengers, comprising more than eight seats in addition to the driver's seat, and having a maximum weight exceeding 5 metric tons. 9

10 Vehicle Definitions - Category N (Goods) Fuel economy/co2 Regulations not applied * Category N: Motor vehicles having at least four wheels, or having three wheels when the maximum weight exceeds 1 metric ton, and used for the carriage of goods. N1: Vehicles used for the carriage of goods and having a maximum weight not exceeding 3.5 metric tons. N2: Vehicles used for the carriage of goods and having a maximum weight exceeding 3.5 but not exceeding 12 metric tons. N3: Vehicles used for the carriage of goods and having a maximum weight exceeding 12 metric tons. FC/CO2 Measurement can be measured on N1. Rationale? : Relates to buying behaviour. Emissions and Fuel Economy, European Legislation 10

11 Fuel Consumption (FC) Calculation and relationship to CO2 Relevant MEASUREMENTS taken test during rolling road emission test. 1) Carbon monoxide - CO 2) Hydrocarbons HC 3) Carbon Dioxide CO2 The fuel consumption (FC), expressed in litres per 100 km (in the case of petrol, LPG, ethanol (E85) and diesel) is calculated by means of the following formulae: FC = (0.118/D) [(0.848 HC) + (0.429 CO) + (0.273 CO2)] Where D is the fuel density. However quantities of CO and HC emissions are comparatively very small in modern vehicles. Hence for a given fuel type and density, FC is effectively directly proportional to CO2

12 Test (Reference) Fuels Fuels used for emission and FC/CO2 testing are specially prepared to ensure consistent and repeatable results. Key 24 parameters (petrol) controlled include: Octane (RON/MON) Density Aromatics Benzine Olefins Sulphur Ethanol (E5) In the case or ethanol which is newly added to the EU spec, this reduces fuel consumption by 1-2% - but has minimal impact on CO2 emissions.

13 Future trends: World Light Duty Cycle and Test Procedure Develop the world wide harmonized light duty test cycle (WLTC) which will represent typical driving conditions around the world. The WLTC are developed based on combination of collected in-use data and suitable weighting factors. Data collection CP s: EU, India, Japan, Korea, USA (and China)

14 Speed (km/h) speed (kph) NEDC and WLTP cycle NEDC (Combined Cycle) 120 kph Start of measurement Single Urban Drive Cycle 195 seconds 40 Extre Urban Drive Cycle 400 seconds time (s) WLTP Version 5.0 low medium high extra high Time (s) WLTP has higher maximum speed (above 130 kmph), harder accelerations and clearly looks more like real driving than the NEDC. WLTP is 34% longer.

15 USA Light Duty CAFE/GHG In the U.S., corporate average fuel economy (CAFE, measured in miles per gallon) is regulated by the National Highway Traffic Safety Administration (NHTSA) and greenhouse gases (e.g. CO 2, measured in g/mile) are regulated by the Environmental Protection Agency (EPA). There are some differences between the standards and allowances within the two programs, but they are generally aligned and referred to as One National Program, beginning in the 2012 MY. The standards become more stringent for each model year. Separate standards apply for cars vs. trucks The standards are attribute based, using vehicle size or footprint. Each manufacturer will have its own fleet-based compliance obligation for every model year, based on the mix of vehicles it sells. Several credit opportunities and other flexibilities are available to help meet the standards. 15

16 Fuel Economy (mpg) USA: Fuel Economy Over Time U.S. CAFE Requirements Fuel economy rates have increased by ~40% since the beginning of CAFE ~30% Today s average light truck gets better mileage than an average 1970s compact car Compared to today, CAFE is required to increase by ~30% by It would have to increase by more than 95% to reach 54.5 MPG by % >95% Numbers are industry estimated car/truck fleet averages 16

17 USA: Other Related Requirements Fuel Economy Label Rule Fuel economy estimates must be placed on the window sticker of new cars and trucks. Estimates are meant to represent real-world driving behavior and conditions. New label formats showing more information (fuel consumption, fuel cost/savings, GHG and smog ratings, new details for EVs and PHEVs) are required beginning in the 2013 MY. 17

18 Vehicle technology trends : Petrol Introduction of EcoBoost Technology Engines Gasoline Direct Injection Turbocharging Downsizing & Boosting Source: Ford Motor Company 18

19 New Vehicle Technology Migration Recent/Near Term Begin migration to advanced technology Mid Term Full implementation of known technology Long Term Volume roll-out of hybrid electric technologies and alternative energy sources Near Term Mid Term Long Term Significant number of vehicles with Stratified Injection technology Dual clutch and 6-speed transmissions replace 4- and 5-speeds Increased hybrid applications Increased unibody applications Introduction of smaller cars and CUVs Electric power steering Battery management systems Aero improvement Weight reduction Engine displacement reduction aligned with weight save Stratified injection engines available in nearly all vehicles Increased use of hybrids as a percentage of gas engines Diesel use as market demands up to 10% Additional Aero improvements EPAS approaching 100% on light-duty vehicles Introduction of plug-in hybrids Percentage of internal combustion dependant on renewable fuels Volume introduction of hybrids and plug-in hybrids Introduction of BEV and fuel cell vehicles Clean electric / hydrogen fuels 19 Source: Ford Motor Company

20 Advanced Gas technologies and stringent emissions levels will reduce the Diesel vs. Gas fuel economy and CO 2 gaps. Fuel Economy Better CO2 Better Diesel Gasoline Emissions Control impact ~10-15% fuel economy difference VCT DI (homogen) Boosting & Downsizing Adv. Combustion (Lean) Today Future 20 Source : Ford Motor Company

21 South Africa Market Fuel economy/co2 developing market example Significant producer of new vehicles : BMW, Ford, GM, Mercedes Benz, Nissan and Toyota all have assembly plants supporting local and export markets. EU Trade agreements. Used vehicle imports prohibited : As opposed to the situation in most Sub Saharan countries. Legislated new vehicle requirements and homologation system. As opposed to just a Road Traffic Act aimed at operational issues as is the case in most developing countries. SA follows Europe in terms of vehicle design. SA participates in WP 29 and adopts ECE vehicle regulations albeit at lower stingency.

22 Units SA:Petrol PC Parc 5% growth Petrol 5% -2014/ Euro 0/1 Euro 2 Euro 3 Euro 4 Source: SAPIA/NAAMSA car park study 2009

23 Units SA: Diesel PC Parc 5% growth Diesel PC 5% -2014/ Euro 1/0 Euro 2 Euro 3 Euro 4 Source: SAPIA/NAAMSA car park study 2009

24 SA Government initiatives(1) Department of Energy Energy Efficiency strategy Energy Efficiency accord

25 Department of Energy: Energy Efficiency Strategy 2009: Objectives Targets to be met by 2015 Industry and Mining 15% final energy demand reduction Power Generation 15% reduction in parasitic electrical usage Commercial and Public Sector Buildings 15% final energy demand reduction Residential sector 10% final energy demand reduction Transport sector 9% final energy demand reduction

26 Legislated labeling requirements New passenger cars Vehicle Fuel Economy and Carbon Dioxide Emission Labelling Every petrol and diesel powered vehicle shall have applied to the inside of its windscreen a fuel consumption label. The label shall be self adhesive and removable and of a type suitable for application to the windscreen. The Label shall be placed in the bottom corner of the windscreen. The fuel consumption label shall contain the following statements and information. The words "FUEL CONSUMPTION" or "FUEL ECONOMY" as a heading The vehicle make, model or description. The fuel consumption and carbon dioxide emissions values as determined by SANS ECE R101 XXX recorded in litres per 100km and grams per km respectively Where a common label is utilised covering different engine, body styles or transmissions the fuel consumption and carbon dioxide figures quoted shall be those as applicable to the worst case combination. As an alternative to sections 1.1, 1.2 and 1.3above, an internally mounted label visible through the windscreen of the vehicle and suitable for removal and inclusion in the owner's manual may be displayed.

27 South Africa: New passenger car Fuel Economy/CO2 label

28 NAAMSA FUEL ECONOMY/CO2 DATA BASE

29 SA Government initiatives (2) National Treasury Environmental based taxation proposals: April 2006 CO2 taxation: New passenger cars and D/Cab LCV s.

30 National Treasury Environmental Fiscal Reform Draft : April 2006 OPTIONS FOR REFORMING EXISTING TAX

31 The Press comments..

32 Final CO2 Taxation: September 2010/March 2011 implementation The rate of emissions tax on passenger vehicles is R75 per gram CO2 emissions in excess of 120 g/km based on test reports. The rate of emissions tax on double cabs is R100 per gram CO2 emissions in excess of 175 g/km based on test reports. If no test report is available the CO2 emissions will be calculated according to the following formula: Passenger vehicles < 3000 cm³: (0.05 x cm³) = g/km CO2 Passenger vehicles > 3000 cm³: (0.05 x cm³) = g/km CO2 Double-cabs: (0.07 x cm³) = g/km CO2 Note: Tax rates increased in 2013 Budget by 20%

33 South Africa: Passenger car CO2 emission data and trend Data source: RGT/NAAMSA Analysis: J A Rayner

34 South Africa: Double Cab LCV CO2 emission data and trend Data Source: RGT/NAAMSA Analysis: J A Rayner

35 Fuels and Vehicle are a System Multiple studies over the past three decades directly link fuel quality to emissions Air quality is not improved solely on restricting emissions standards fuel quality plays a key role in air quality improvements Reductions in NOx, HC, CO, CO2, etc. are achieved through a harmonious relationship between vehicle technologies and fuel quality. Vehicle emission equipment without the appropriate fuel quality can increase emissions. Fuel Quality Vehicle Technology Improvements in Fuel Economy and Emissions 35

36 World-Wide Fuel Charter First established in 1998 to promote greater understanding of fuel quality needs of motor vehicle technologies and to harmonize fuel quality worldwide in accordance with vehicle needs This is the go-to document for fuel quality information. Covers both gasoline and diesel, with four levels of each for fuel quality based on emission requirements Biofuels covered by separate document Access from AutoAlliance.org 36

37 SA vehicle fuel economy improvement potential NAAMSA inputs to National Treasury 2010

38 Summary Globally all developed markets are moving rapidly to new higher fuel economy, low CO2 vehicle technology. CO2 Measurement is an effective proxy for Fuel Consumption and has the added benefit of not being significantly influenced by ethanol addition. In the case of S Africa the benefits of fuel economy labelling and recent CO2 taxation are showing an approximate 1% pa CO2 improvement for passenger cars. Further progress towards more fuel efficient technology, is subject to fuels of appropriate quality becoming available. Comparison of typical developing market spec vehicles with that of the EU indicates significant improvements in CO2/fuel economy are possible given the appropriate fuel quality.

39 End Stuart Rayner National Association of Automobile Manufacturers of South Africa.

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