REVIEW OF EMISSION STANDARDS (EURO VI)

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1 REVIEW OF EMISSION STANDARDS (EURO VI) FOR HEAVY VEHICLES DISCUSSION PAPER Issued: October 2012 Closing date for comments: 31 January 2013

2 This page has intentionally been left blank Formatted: Tab stops: 2.12 cm, Left

3 Contents Glossary of Terms... 3 Purpose of paper Overview Current status of urban air quality in Australia Contribution of heavy vehicles to air pollution Health impacts of heavy vehicle emissions Future air pollution trends Regulatory framework Current international standards Euro VI US EPA Japanese Post New Long Term Is government action required? Determining costs associated with implementing ADR 80/ Other technical issues relevant to ADR 80/ Alternative standards Reporting fuel consumption and CO 2 emissions Appendix 1 Urban air quality in Australia Appendix 2 Air pollutants and air toxins References

4 Tables and Figures Table 1 Health effects and populations at risk from certain air pollutants... 6 Figure 1 Percentage contribution of motor vehicles to capital city air pollution ( ).. 9 Figure 2 Base-case projected growth in major pollutant emissions from motor vehicles for Australian metropolitan areas, Table 2 Heavy vehicles by fuel type January Figure 3 Historical and projected trends in road transport emissions, Table 3 Emission limits for heavy diesel vehicles in Australia, 1995-present Figure 4 Comparison of steady state emission limits for heavy diesel vehicles, 1995 present Table 4 Comparison of Euro V and Euro VI emission limits Figure 5 Comparison of Euro V and Euro VI emission limits Table 5 Comparison of current US EPA 2010 emission standards for heavy duty diesel vehicles with the modified US EPA 2007 standard applied in ADR 80/ Table 6 Comparison of current Japanese heavy duty diesel emission standards with the Japanese standard as accepted under ADR 80/ Table 7 Comparison of (transient cycle) emission limits under Euro VI and equivalent standards Table A1 Current NEPM standards and goals for air pollutants Figure A1 - Number of days NEPM 1hr Ozone Standard (0.10ppm) exceeded in the four largest Australian capital cities Figure A2 - Number of days NEPM 4hr Ozone Standard (0.08ppm) exceeded in the four largest Australian capital cities Figure A3 - Number of Days NEPM 24hr PM 10 Standard (50 µg/m 3 ) exceeded in the four largest Australian capital cities

5 Glossary of Terms ADR Australian Design Rule BITRE Bureau or Infrastructure, Transport and Regional Economics CO Carbon monoxide CO 2 Carbon dioxide Department Department of Infrastructure and Transport EPA Environmental Protection Authority ESC European Stationary Cycle ETC European Transient Cycle g/bhp-hr Grams per brake horsepower hour g/kwh Grams per kilowatt hour GVM Gross Vehicle Mass HC Hydrocarbons JPNLT Japanese Post New Long Term standards NEPC National Environment Protection Council NEPM National Environment Protection Measures NMHC Non-methane hydrocarbons NO 2 Nitrogen dioxide NO X Oxides of nitrogen PM (2.5, 10) Particulate Matter (with diameter less than 2.5 and 10 microns, respectively) ppm Parts per million RIS Regulation Impact Statement SO 2 Sulfur dioxide SO x Oxides of sulfur UN United Nations US United States VOC Volatile Organic Compound WHSC Worldwide Harmonised Steady Cycle WHTC Worldwide Harmonised Transient Cycle µg/m 3 Micrograms per cubic metre 3

6 Purpose of paper Emissions from road vehicles affect the quality of the air we breathe and the quality of life in Australia s cities. National actions to strengthen vehicle emissions standards are accepted as a key measure to reduce urban air pollution from the road transport sector and deliver associated health benefits. Since the last review of heavy vehicle emission standards in 2004, more stringent standards, such as Euro VI, have been adopted for heavy vehicles internationally. This discussion paper has been prepared to consider the merits of adopting these standards in Australia. In Australia, vehicle emission standards are set via the Australian Design Rules (ADRs) under the Motor Vehicle Standards Act The Australian Government has a policy to harmonise Australian vehicle standards where possible with the international standards established through the United Nations (UN). The current ADR 80/03 - Emission Control for Heavy Vehicles adopts the Euro V standards, with equivalent US and Japanese standards accepted as alternatives. Your comments All comments must be in writing and should be ed to or posted to: Vehicle Emissions and Environment Team Surface Transport Policy Division Department of Infrastructure and Transport GPO Box 594 CANBERRA ACT 2601 All comments must be received by: 31 January 2013 In the interest of transparency, all submissions will be treated as public documents and posted on the Department s website. Respondents are invited to provide comments they consider relevant to this review. However, it should be noted that the purpose of this discussion paper is to evaluate the merits of adopting more stringent heavy vehicle emission standards in Australia to improve urban air quality and minimise the impact of emissions on human health. Associated policy issues, such as emissions from vehicles currently in-service, emissions from non-road engines and greenhouse gas emissions (other than reporting requirements under Euro VI) fall outside the scope of this review. For the purposes of this review, heavy vehicle means any vehicle with a gross vehicle mass over 3.5 tonnes. References to air pollution and emissions refer to those harmful gases and particles that impact on human health. They do not include greenhouse gases, such as carbon dioxide (CO 2 ), that contribute to climate change, which are addressed through other policy measures. Review process This discussion paper is the first step in the public consultation process to review the merits of introducing more stringent air pollution standards for heavy vehicles in Australia. The paper examines the public policy reasons for why possible action in the form of regulation could be required in this area. The second step in the public consultation will be a draft regulatory impact statement (RIS) which will include a cost-benefit analysis of the possible introduction of new regulation. The 4

7 draft RIS will also seek to examine in more detail any concerns raised by stakeholders in response to the discussion paper. Based on an assessment of submissions and other feedback from stakeholders, the Department of Infrastructure and Transport (the Department) will prepare a final RIS for consideration by the Minister for Infrastructure and Transport, who will then make a decision on the determination of ADR 80/04. 5

8 1. Overview Air pollution from transport related sources has long been recognised as exacerbating human health concerns. In 2003, it was estimated that 3000 people died prematurely from the effects of long-term air pollution in Australia. This number was double the road toll from the same year. 1 Air pollution from motor vehicles includes both exhaust and evaporative emissions. In recognition of the adverse health impacts of emissions from vehicles, Australia has been reducing air pollution from the transport sector by introducing increasingly stringent vehicle emission standards since the early 1970s. The impact on human health Air pollution can have a significant impact on human health, especially on the cardiorespiratory system. Those with pre-existing respiratory conditions, such as asthma and allergies, are especially at higher risk of having their illness worsened by air pollution. As shown in the table below, the effects on human health include reduced lung function, ischemic heart disease, stroke and respiratory illnesses, such as lung cancer. Air pollution from motor vehicles is particularly harmful for human health as the general population has a higher level of exposure to motor vehicle emissions than other pollutant sources. 2 Road dust generated by traffic also impacts on human health as the particles from tyres and brake pads break down into particles small enough to enter the bloodstream through the lungs. TABLE 1 - HEALTH EFFECTS AND POPULATIONS AT RISK FROM CERTAIN AIR POLLUTANTS 3 Pollutant Health effects Population at greatest risk Carbon monoxide (CO) Nitrogen dioxide (NO 2 ) Particulate Matter (PM) Ozone (O 3 ) Mortality and increased hospital admission due to heart disease Hospital admissions for respiratory diseases, decreases in lung function, cardiovascular disease Mortality due to cardiovascular and respiratory diseases; hospital admissions due to respiratory and cardiovascular disease; decreases in lung function Mortality due to respiratory and cardiovascular diseases; hospital admissions due to respiratory diseases; decreases in lung function People with ischaemic heart conditions Sufferers of respiratory disease, such as children with asthma; those with cardiovascular disease Elderly people with respiratory and cardiovascular diseases; people with respiratory diseases, such as children with asthma Elderly people; people with respiratory diseases Concentration of air pollution Air pollution from motor vehicles is of greatest concern in urban areas as the concentration of motor vehicles and associated pollutants can lead to high pollution levels. The topographic features surrounding cities can also trap pollutants and facilitate ozone production, intensifying pollution problems. For example, in the City of Sydney 55% of 6

9 particulate matter emissions come from motor vehicles compared to 30% in the Sydney Basin. 4 Sydney and the Illawarra exceed the national air pollution standards most frequently with regard to ozone, 5 which is strongly influenced by emissions of volatile organic compounds (VOC) and oxides of nitrogen (NOx). Regional towns with large industrial sectors can also experience air pollution problems, but these are generally attributable to point sources rather than mobile sources, such as motor vehicles. Measures to address air pollution from motor vehicles For light vehicles, in June 2011, the Minister for Infrastructure and Transport announced that Australia would adopt the Euro 5 and Euro 6 emission standards for light vehicles (via ADRs 79/03, 79/04 and 79/05). Once these standards are fully implemented in 2018, these standards will reduce a new light vehicle s maximum allowable emissions of hydrocarbons by up to 50 per cent; oxides of nitrogen by up to 70 per cent and particulate matter by up to 90 per cent. 6 In order to further reduce air pollution from heavy vehicles and thereby lessen the adverse health impacts further, the Australian Government is now considering the merits of introducing a new ADR 80/04, based on Euro VI standards (as applied in UN Regulation 49/06), subject to a formal assessment of the costs and benefits via a Regulation Impact Statement. To allow manufacturers greater flexibility, while delivering similar air quality outcomes, the equivalent European Commission Regulations 595/2009 and 582/2011, along with the US EPA 2010 and the Japanese Post New Long Term 2009 standards could also be considered as suitable alternative standards, consistent with the approach used in previous emission standards for heavy vehicles. If the Government decides to proceed with a new ADR 80/04, a suitable time for implementation could be 1 January 2016 for new model vehicles and 1 January 2017 for existing models. This timeframe would allow manufacturers sufficient time to comply with the new standards without significant disruption to their product plans. Such a commencement date would be three years after the start date in Europe and six years after the start date for ADR 80/03. This commencement date would give manufacturers more time to amortise the costs associated with complying with ADR 80/03 and take advantage of expected advances in technologies that meet these tougher standards. Expected benefits from tougher standards If adopted, the Euro VI standards would reduce the maximum allowable emissions from new vehicles of NOx by up to 80% and particulates by up to 66% relative to Euro V. Similar outcomes are expected for engines that comply with equivalent US and Japanese alternative standards. Over the longer term the benefits of introducing these standards will amplify the benefits arising from the replacement of older vehicles with newer vehicles in the truck and bus fleets, and further reduce the emission impacts associated with expected growth in the transport task. 7

10 Questions 1. Would you support the determination of a new ADR 80/04 based on the Euro VI emission standards? 2. What implementation timelines would you consider to be reasonable? 3. Do you agree that the adoption of more stringent emission standards for new heavy vehicles could contribute to improvements air quality in Australia? 4. Do you have any additional information or studies that the Department could consider in assessing the health and environmental benefits of implementing the possible new ADR 80/04? 8

11 2. Current status of urban air quality in Australia Due to improved regulation of air pollutants, urban air quality in Australia has improved and is now considered generally good, with a reduction in most pollutants such as carbon monoxide (CO), sulfur dioxide (SO 2 ) and nitrogen dioxide (NO 2 ) over the last 20 years. However, some levels of pollutants, for example particulates and secondary ozone, have remained stable over the past two decades. 7 More detailed information about urban air quality in Australia can be found in Appendix 1. The main source of pollutants varies between different places but may include industry, domestic heating, power generation and internal combustion engines. The majority of oxides of nitrogen (NOx) in most major cities, for example is produced by motor vehicles. While motor vehicles are a significant contributor to urban air pollution, the relative contribution of motor vehicles to air pollution varies in every capital city due to the: contribution of industrial activity, dust storms and bushfires in the airshed; amount of wood fire smoke in the winter months; and number of motor vehicles and vehicle kilometres travelled. Figure 1 Percentage contribution of motor vehicles to capital city air pollution ( ) 8 NOx VOC PM10 As shown in figure 1, motor vehicles account for the majority of NOx emissions in most capital cities. In Sydney, Brisbane and Melbourne the proportion of NOx emissions attributable to road vehicles is over 60%. Improved urban air quality Increasingly stringent air pollution emission standards for motor vehicles have contributed to improved air quality. For example, urban tailpipe emissions of NO x have been reduced by around 40% since 1999 during a time period with 4.4 million more vehicles on the road. 9,10 Urban vehicle emissions of VOCs (from both exhaust and evaporative releases) are also projected to fall by around 25% over the next decade (under business-as-usual trends in vehicle use and performance) resulting in an aggregate reduction of over 60% in the 30 year time period between 1990 and Figure 2 shows that many pollutants have been 9

12 Emissions Index reduced considerably since 1999, when Australia began to introduce increasingly stringent air pollution standards in line with its policy to harmonise emission standards with the Euro standards. FIGURE 2 BASE-CASE PROJECTED GROWTH IN MAJOR POLLUTANT EMISSIONS FROM MOTOR VEHICLES FOR AUSTRALIAN METROPOLITAN AREAS, (INDEX WITH 1990 = 100) 12 NOx PM10 (exhaust) VOC (evap + exhaust) CO SOx Metropolitan refers to all travel undertaken within the eight state and territory capital cities. Note that the PM 10 values graphed here refer solely to exhaust emissions and do not include other vehiclesourced particulates (e.g. due to road-dust, tyre wear or secondary sulfate aerosols). 10

13 3. Contribution of heavy vehicles to air pollution Heavy vehicles constitute approximately 4% of the motor vehicle fleet in Australia, 13 but have a much higher contribution to transport related emissions. The heavy vehicle fleet performs about 8% of all vehicle kilometres travelled, 14 and accounts for around one quarter of all road transport fuel consumed in Australia. 15 A key feature of the heavy vehicle fleet in Australia is its dominance by compression ignition (diesel) engines. Over 90% of Australia s heavy vehicle fleet use diesel engines, while approximately 8% use petrol engines (see table 2). 16 A small percentage of the fleet run on gaseous fuels, such as Liquefied Petroleum Gas and Compressed Natural Gas. Generally speaking, diesel engines emit higher levels of NOx and PM compared to equivalent petrol engines, whereas petrol engines typically produce more carbon monoxide and VOCs. However, the actual emissions of any particular vehicle also depend strongly on its level of maintenance, operating conditions and the specific emission control equipment used. TABLE 2 - HEAVY VEHICLES BY FUEL TYPE JANUARY Vehicle Type Total Petrol Diesel % Petrol % Diesel Light Rigid (3.5 to 4.5t GVM) Heavy Rigid (over 4.5t GVM) Articulated Trucks Buses Total The Bureau of Infrastructure Transport and Regional Economics (BITRE) estimates that heavy vehicles were responsible for approximately 31% of NOx and 47% of PM 10 emissions from motor vehicles in

14 4. Health impacts of heavy vehicle emissions Air pollutants The air pollutants of most concern from heavy vehicles are particulate matter, oxides of nitrogen and volatile organic compounds. These pollutants are formed either through imperfect combustion or are evaporative emissions. Pollutants from imperfect combustion are formed as the partial burning of fuel in the engine creates unintended chemical compounds such as carbon monoxide. Theoretically, a perfect combustion in an engine would only produce water and carbon dioxide. However, due to imperfect conditions the unburnt fuel and other chemical compounds are emitted as vapour from the tailpipe of the vehicle. The nature of these compounds is also influenced by the composition of the fuel itself, for example, diesel fuels with a higher sulfur content tends to result in higher levels of particulate emissions. Evaporative emissions are also tied to the chemical composition of the fuel and occur when fuel vapours escape from the vehicle. Total releases of volatile organic compounds from vehicles often comprise a high percentage due to evaporative emissions. More detail about the health impacts of specific air pollutants and air toxins can be found in the Appendix 2. Air toxins Whilst a reduction in air toxins is not specifically mandated in Euro VI regulations, a large amount of air pollutants, such as PM and VOCs are comprised of air toxins. 19 Air toxins include various volatile and semi volatile organic compounds, polycyclic aromatic hydrocarbons, heavy metals and aldehydes. 20 Many of these toxins are carcinogenic and are toxic to humans even in very low doses. The air toxins described in Appendix 2 are present in petrol and diesel and emitted to the air through exhaust fumes and/or evaporation. Many air toxins are also found in VOC emissions. The implementation of Euro VI would reduce the production of many of these toxins through reductions in PM and VOC emissions. Relationship between fuel quality and air pollutants As mentioned earlier, the chemical composition of the fuel itself can also influence exhaust emissions, both directly and by affecting the ability of emission control technologies, such as catalysts and particulate traps to work effectively. The current Australian standard for diesel requires sulfur content no greater than 10ppm, 21 which is consistent with requirements in Europe, the United States and Japan. No evidence has been presented to suggest that further changes to the diesel fuel standard would be required to support Euro VI technology. 12

15 5. Future air pollution trends The Bureau of Infrastructure, Transport and Regional Economics (BITRE) has recently performed business-as-usual projections of transport emissions. As shown in figure 3, the BITRE modelling anticipates that many of the major pollutants will decline further over the next two decades. FIGURE 3 HISTORICAL AND PROJECTED TRENDS IN ROAD TRANSPORT EMISSIONS, 1970 TO 2030 (1990=100) 22 Note - PM 10 values in this graph refer solely to exhaust emissions and do not include other vehicle-sourced particulates (e.g. road-dust, brake and tyre wear, secondary sulfates). Total PM 10 mass levels from Australian road use (i.e. including wear particulates and secondary aerosols as well as combustion PM) are not expected to decline as rapidly as for solely the exhaust output. However, the BITRE anticipates that many of the pollutants, including those of significance to heavy vehicles (such as PM and NOx), are likely to remain at substantial levels in the future. Despite improvements achieved through current vehicle standards, air pollutants from heavy vehicles are expected to continue to cause concern due to growth in vehicle kilometres as a result of increased demand for transport. Over the longer term, it is anticipated that emission levels will start to rise, as increases in annual vehicle activity will start to offset the reductions achieved by current vehicle standards when the emission control measures required to meet these standards are incorporated into the entire fleet. In the absence of further tightening of vehicle emission standards, the downward trends for PM and NOx shown in figure 3 are unlikely to continue. 13

16 The health impacts of the current trends for particulates in this analysis may also be understated, because the graphed PM trends are based on mass levels, as this is the measure that the current standards and consequently the bulk of available vehicle test data is based upon. The adverse health impacts of particulates are most strongly correlated with the ultrafine component of total PM, which contributes little to overall particulate mass but forms the greater part of the total particle count. While the BITRE analysis expects that light vehicles will continue to account for the majority of vehicle activity in 2030, it is anticipated that heavy vehicle kilometres, and consequently emissions, will grow at a faster rate (57% between 2010 and 2030) than light vehicles (44% between 2010 and 2030). Within the heavy vehicle fleet, articulated trucks (2.49% per annum) and metropolitan buses (2.41% per annum) are expected to experience the greatest level of growth in activity, despite expected improvements in energy intensity (of 0.8% per annum for trucks). Given this expected growth in heavy vehicle activity and the introduction of more stringent emission standards for light vehicles from November 2013 (via ADRs 79/03, 79/04 and 79/05), heavy vehicles will become a more significant contributor to urban air pollution in Australia in the absence of more stringent standards. 14

17 6. Regulatory framework In Australia, vehicle standards are regulated by the Australian Design Rules (ADRs), which are legislative instruments made under the Motor Vehicle Standards Act 1989 for both new and imported road vehicles at the point of supply to the Australian market. Emission standards have been in place for light duty petrol vehicles since the early 1970s and for light and heavy diesel vehicles since 1995, with increasingly stringent standards commencing from Harmonisation with international standards The Australian Government has been harmonising its vehicle standards with those adopted by the UN since it acceded to the 1958 Agreement Concerning the Adoption of Uniform Technical Prescriptions (the 1958 Agreement) in April Since acceding to this agreement the Australian Government has had a policy to harmonise Australia s vehicle standards with the international standards developed through the UN where possible. The decision to harmonise with international standards is based on the notion that such a policy promotes the desired safety and environment outcomes and facilitates international trade in motor vehicles. Given the size, composition and reliance on imports of the Australian heavy vehicle market it is undesirable for Australia to set its own unique emission standards. Furthermore, the UN or Euro standards are recognised as the only truly international standards for vehicles under the World Trade Organisation rules, to which Australia is a signatory. While the UN standards are currently based on European standards, they form the basis of vehicle emission standards in many other countries. Non-European signatories to the 1958 Agreement include countries such as New Zealand, Korea and Thailand. China and India also base their heavy vehicle emission standards on the Euro standards. 23 Australia s heavy vehicle emission standards In Australia, vehicle emission standards are determined by the Minister for Infrastructure and Transport as ADRs, which are legislative instruments under subsection 7 of the Motor Vehicle Standards Act The quality of fuel in Australia is regulated by the Fuel Quality Standards Act 2000 (the Act) which places an obligation on the fuel industry, including fuel suppliers, to supply fuels that meet strict environmental requirements. The Minister responsible for the Act is currently the Parliamentary Secretary for Sustainability and Urban Water. Australia s current emission standard for heavy vehicles is ADR 80/03. ADR 80/03 is based on the Euro V emission standards, but also accepts vehicles that comply with certain subparts of the United States Code of Federal Regulations, Part 86 (United States (US) EPA 2007) and the Japanese New Long Term 2005 emission standards. ADR 80/03 commenced on 1 January 2010 for new model vehicles and for all new heavy vehicles on 1 January The acceptance of these alternative standards reflects the relatively small size of the Australian market, which makes it expensive to re-test engines that are not sold in other Euro standard markets but meet similar requirements. 15

18 Emission Limit (g/kwh) TABLE 3 EMISSIONS LIMITS FOR HEAVY DIESEL VEHICLES IN AUSTRALIA, 1995-PRESENT Standard ADR 70/00 ADR 80/00 ADR 80/02 ADR 80/03 Date Introduced* Source Standard Test cycle 1/7/95-1/7/96 Euro I Steady State Source Standard Emission limits (g/kwh) CO HC NOx PM Alternative Standards US EPA 91 and Japan 94 1/1/02-1/1/03 Euro III ESC US EPA 98 (model ETC year 2000) 1/1/07-1/1/08 Euro IV ESC US EPA 2004 and ETC Japanese New Long Term /1/10-1/1/11 Euro V ESC US EPA 2007 and ETC Japanese New Long Term 2005 Notes: 1. The first date applies to new model vehicles, second date to applies all new vehicles. 2. Emission limits in the ETC apply to non-methane hydrocarbons. FIGURE 4 COMPARISON OF STEADY STATE EMISSION LIMITS FOR HEAVY DIESEL VEHICLES, 1995 PRESENT ADR 70/00 ADR 80/00 ADR 80/02 ADR 80/03 While Australia does manufacture some heavy vehicles, their engines are imported from Europe, the United States and Japan. An analysis of VFACTS and certification data for heavy vehicles sold in Australia in 2011 suggests that approximately 80% of vehicles were certified to Euro V standards, with the remainder complying with US or Japanese standards. 24 The different world standards are gaining increasing equivalence and it is anticipated that the introduction of a worldwide harmonised test cycle, as discussed later, will make the standards more directly comparable in the future. 16

19 Emission Limit (g/kwh) 7. Current international standards Euro VI The European Union adopted the Euro VI regulations for heavy vehicles in 2009 to apply to new model vehicles from 31 December 2012 and to all new vehicles from 31 December The Euro VI emission standards were subsequently adopted at the 157th session of the World Forum for Harmonization of Vehicle Regulations (WP 29) in June 2012 as the 06 series of amendments to the UN standard for heavy vehicle emissions known as Regulation Euro VI is the most stringent European regulation yet with an expected reduction in NOx emission limits by 80% and in PM by up to 66% compared with current Euro V emission limits. 27 Changes in the emission limits for heavy duty diesel vehicles from Euro V to Euro VI are shown in table 4 and figure 5 below. TABLE 4 COMPARISON OF EURO V AND EURO VI EMISSION LIMITS (LIMITS IN G/KWH) Standard Test CO HC NOx PM Euro V ESC ETC Euro VI WHSC Note: WHTC Transient cycle limits apply to non-methane hydrocarbons (NMHC) FIGURE 5 COMPARISON OF EURO V AND EURO VI EMISSION LIMITS Euro V (ESC) EuroVI (WHSC) As shown in table 4 and figure 5, there is a significant reduction in the maximum allowable emissions of HC, NOx and PM under the Euro VI standards compared to Euro V. Furthermore, Euro VI contains new requirements to improve air quality and to ensure ongoing compliance with the standards. These include: The introduction of the Worldwide Harmonised Transient Cycle (WHTC) and Worldwide Harmonised Steady Cycle (WHSC) as defined in UN Global Technical Regulation No 4, which allows for more stringent and reliable testing of vehicles 17

20 covering typical driving conditions in the European Union, United States, Japan and Australia. Euro VI introduces the use of these testing cycles in place of the previous European Transient Cycle and European Stationary Cycle. These harmonised test cycles are expected to become the standard worldwide, and will allow more direct comparison between engines manufactured and certified in different countries. The testing of vehicles using the WHTC and WHSC reflects road driving conditions more accurately, including monitoring emissions when a vehicle is at full load. The WHTC also tests for hot soak emissions where the vehicle is still emitting after the ignition has been turned off. A cold start test is also included in the WHTC. An ammonia limit of 10ppm to minimise the possible health impacts of ammonia produced by Selective Catalytic Reduction systems that use a reagent to control NOx emissions. Regulated reporting requirements for fuel consumption and CO 2 emissions with the cycle averaged CO 2 values being reported with other emission levels, 28 to help ascertain the contribution of heavy vehicles to total CO 2 emissions. 29 Introduction of limits on the number of particles emitted (8x10 11 /kwh on the WHSC and 6x10 11 /kwh on the WHTC) in addition to the current particulate mass limits shown in table 5. These limits will reduce the number of ultra fine particles that are not addressed effectively by the mass based limits and are believed to have the greatest impact on human health. More stringent requirements for on-board diagnostics that alert a driver to malfunctions in the emission control equipment and in some cases limit the torque of the vehicle until the equipment is fixed. The on-board diagnostics system also ensures that the equipment will not be tampered with. More stringent requirements for manufacturers to demonstrate that their vehicles can meet the standards for the lifetime of the vehicle, to ensure the deterioration of emission control technology is accounted for by the manufacturer as follows: 18

21 Vehicle Category Passenger vehicles with a gross vehicle mass not exceeding 5 tonnes. Goods carrying vehicles with a gross vehicle mass exceeding 3.5 tonnes but not exceeding 16 tonnes. Durability Requirements 160,000 km or five years (consistent with Euro 5/6 requirements for light vehicles) 300,000 km or six years Passenger vehicles with a gross vehicle mass exceeding 5 tonnes: - that are constructed to allow for the carriage of standing passengers; or - with no provision for standing passengers; and a seating capacity not exceeding 22 passengers (excluding the driver) and; a gross vehicle mass not exceeding 7.5 tonnes. Goods carrying vehicles with a gross vehicle mass exceeding 16 tonnes. 700,000 km or seven years All other passenger vehicles with no provision for standing passengers. 19

22 US EPA 2010 The current regulations enforced by the US EPA commenced in The standards were phased in on a percentage of sales basis from 2007, with all engines required to comply from Table 5 compares the current US standard with the modified US standard accepted in ADR 80/03. TABLE 5 COMPARISON OF CURRENT US EPA 2010 EMISSION STANDARDS FOR HEAVY DUTY DIESEL VEHICLES WITH THE MODIFIED US EPA 2007 STANDARD APPLIED IN ADR 80/03 (LIMITS CONVERTED FROM G/BHP-HR TO G/KWH) Standard US EPA 2007 (as modified in ADR 80/03) Transient Test Steady State Test CO NMHC NOx PM Option Option Option Option US EPA 2010 (current US standard) The 2010 emission limits apply for both the transient Federal Test Procedure (FTP) and the Supplemental Emission Test, a steady state emission test introduced from 1998 onwards. The US standards also contain Not To Exceed limits in which excessive speed and torque are limited to ensure emissions are controlled over all load and speed combinations. These limits are currently set at 1.5 times the FTP emission limits. 30 US EPA 2010 DURABILITY REQUIREMENTS APPLY AS FOLLOWS: 31 Vehicle Category Vehicles with a gross vehicle mass over 10,000lbs (4.5 tonnes) but less than 19,500lbs (8.8 tonnes) Vehicles with a gross vehicle mass between 19,500 lbs (8.8 tonnes) and 33,000 lbs (15 tonnes) Vehicles with a gross vehicle mass over 15 tonnes Durability Requirements 110,000 miles (177,000 km) or 10 years 185,000 miles (298,000 km) or 10 years 435,000 miles (700,000 km) or 10 years/22,000 hours of service 20

23 Japanese Post New Long Term 2009 The Japanese Government has been regulating vehicle emissions since the late 1960s, though the regulation of PM only commenced in Since the introduction of the 2003 standards, the Japanese have had some of the most stringent emissions limits in the world. The current Japanese Post New Long Term Standards came into force in October 2009 with full compliance by October TABLE 6 COMPARISON OF CURRENT JAPANESE HEAVY DUTY DIESEL EMISSION STANDARDS WITH THE JAPANESE STANDARD AS ACCEPTED UNDER ADR 80/03 (IN G/KWH) 32 Standard CO NMHC NOx PM New Long Term 2005 (accepted in ADR 80/03) Post New Long Term 2009 (current standard) Vehicles are tested in accordance with the JE05 transient test cycle, which is based on Tokyo driving conditions. 33 Japanese durability requirements apply to heavy diesel vehicles as follows: 34 Vehicle Category Vehicles with a gross vehicle mass between 3.5 and 8 tonnes Vehicles with a gross vehicle mass between 8 and 12 tonnes Vehicles with a gross vehicle mass over 12 tonnes Durability Requirements 250,000 km 450,000 km 650,000 km 21

24 8. Is government action required? As indicated in the previous discussion, there are a number of reasons why government action is required to reduce air pollution from heavy vehicles. Regulation has previously proved to be a cost effective approach and earlier assessments have indicated that there is a clear market failure in this area. Further, there are benefits available to consumers in that heavy vehicle users get ready access to new technology. When deciding on the purchase or use of their vehicle, motor vehicle users generally do not take account of the health and environmental costs they impose on the wider community stemming from vehicle emissions. As a consequence there is an expectation by the community that governments will address this market failure by intervention, through regulatory means or other measures. In the absence of regulation, manufacturers are likely to have limited incentive to adopt these technologies voluntarily, despite the availability of the technology in other markets as the direct economic benefit to them would be small relative to their cost. Vehicle emissions are generally not regarded as significant a consideration for buyers compared with other aspects such as safety, cost and fuel efficiency. Previous emissions standards adopted through ADRs have proven to be an effective means of reducing the impacts of emissions from the transport sector. While urban air quality in Australia is generally considered to be good by international standards, recent evidence suggests that there is no clear threshold at which air pollutant concentrations cease to have adverse health impacts. These circumstances indicate that cost effective measures to reduce emissions of harmful pollutants, particularly into urban airsheds should be examined, including those from heavy vehicles. Targeting the transport sector is especially important as the demand for transport services continues to grow, and heavy vehicles will be a major contributor to that task. The technology required to comply with Euro VI and equivalent standards is already well advanced and will continue to evolve over the next few years. Adopting these standards via the ADRs would enable Australia to take advantage of the benefits of these cleaner engine technologies. Not adopting these standards, when other countries have implemented such standards, would be inconsistent with Australia s commitment to harmonise vehicle standards with international standards and may also limit the ability of local truck and bus distributors and component suppliers to access more advanced technologies. It may also increase the risk of Australia becoming a dumping ground for older technology. 22

25 9. Determining costs associated with implementing ADR 80/04 Some engine manufacturers have already released products that comply with Euro VI limits. Other manufacturers are currently developing Euro VI compliant technology ahead of the Euro VI start date in the European Union. Engines that meet Euro VI and equivalent standards are expected to rely on a combination of Exhaust Gas Recirculation and Selective Catalytic Reduction to meet the NOx emission limits. The tighter emission limits for particulates, in particular the Euro VI particle number limit, are also expected to require manufacturers to fit advanced particulate traps to their vehicles. These technologies along with other technologies required to meet the relevant on-board diagnostic and durability requirements, are likely to increase the cost of new trucks and buses in the short term, and this would have a flow on effect to the second hand market. The European Union analysis suggests that any such price increase is likely to be small relative to the cost of a new truck or bus, and operators should be able to pass on any increased costs to their customers with minimal impact. 35 The Department anticipates that there may also be increased costs to operators associated with servicing and maintaining Euro VI engines in the short term, but these costs should decrease over time as the technology becomes more commonplace. Some bus manufacturers have suggested that the technology required to meet Euro VI may lead to reductions in seating capacity to enable bus operators to meet on-road mass and dimension limits. The Department is aware of concerns raised by some in the truck and bus industry about a possible increase in fuel consumption from the implementation of Euro VI due to the technology needed to decrease emissions to the required level and associated mass increases. Traditionally tighter NOx limits have constrained manufacturers ability to improve fuel consumption and reduce CO 2 emissions. However, the Department understands that some manufacturers have been able to avoid fuel consumption penalties, despite the lower NOx limits and minor weight increases associated with the adoption of these new technologies. Questions: 5. Do you have any additional information or studies that the Department could consider in assessing the costs associated with implementing the proposed new ADR 80/04? 23

26 10. Other technical issues relevant to ADR 80/04 Alternative standards Under previous heavy vehicle emission standards adopted in the ADRs, manufacturers have had the option to comply with equivalent alternative (US EPA or Japanese) standards in lieu of the primary (Euro) standard, where the alternative standards are considered to offer a comparable level of emissions control. The acceptance of these alternative standards reflects the relatively small size of the Australian market, which can make it difficult to amortise the costs of re-testing engines that are primarily sold in their home markets and designed to comply with the domestic (US or Japanese) standard. When considering the need to recognise alternative standards it is also important to consider the origin of heavy vehicles supplied to the Australian market. While 2011 sales and certification data suggests that over 80% of heavy vehicles met Euro V requirements to comply with ADR 80/03, the Department notes that the majority of heavy vehicles sold in Australia in 2011 were produced by Japanese manufacturers and almost half of the engines used in heavy vehicles with a gross vehicle mass over 15 tonnes were produced by US based manufacturers. 36 Advantages of allowing equivalent alternative standards: Reduces compliance costs for manufacturers, by avoiding the need to test engines to different test cycles. Makes it more commercially viable to supply vehicles that are not sold in Europe, but comply with comparable standards, thereby providing greater choice for Australian truck and bus operators. Disadvantages of allowing equivalent alternative standards: Differences in test procedures can make cross-standard comparisons of absolute emission limits difficult. Manufacturers that supply different heavy vehicles to the Australian market may choose to supply vehicles that comply with the least stringent standard. Increases administrative complexity of the standard. If the same multi-standard approach was adopted in ADR 80/04, as provided for in current and previous heavy vehicle emission standards, the alternative standards that would be proposed to be accepted are the US EPA 2010 standard (with on-board diagnostics and inducement requirements for the 2012 or later model years for engines with Selective Catalytic Reduction systems) and the Japanese Post New Long Term 2009 standard. Table 7 compares the transient cycle emission limits applicable under each standard. 24

27 TABLE 7 COMPARISON OF (TRANSIENT CYCLE) EMISSION LIMITS UNDER EURO VI AND EQUIVALENT STANDARDS (G/KWH) Standard NMHC NOx PM Euro VI US EPA JPNLT While the emission limits that apply under these mass based standards are considered to be comparable, it should be noted that the equivalent US and Japanese standards do not currently require heavy vehicles to meet a particle number limit. Nevertheless, it is anticipated that most US and Japanese manufacturers would choose to install a particulate trap on their heavy diesel vehicles to meet these emission standards. Questions: 6. Do you consider the proposed alternative standards to be sufficiently equivalent in stringency to Euro VI? 7. Do you consider the proposed alternative standards discussed above should be accepted in ADR 80/04? 8. If the proposed alternative standards were not accepted, do you consider that this would significantly affect the ability of truck and/or bus manufacturers to supply vehicles to Australia? What would be the impact on compliance costs? 25

28 Reporting fuel consumption and CO 2 emissions The Euro VI standards include provisions that require manufacturers to report fuel consumption and CO 2 emissions alongside regulated air pollutant emissions. These provisions are intended to help determine the contribution of heavy vehicles to CO 2 emissions, although it is recognised that because the CO 2 data is obtained from the engine based test, the actual emissions would be strongly affected by the type of vehicle the engine is installed in. If ADR 80/04 adopted these provisions, manufacturers certifying to the Euro VI standard would be required to provide this information as part of the certification process. If the requirement to report CO 2 emissions was adopted in ADR 80/04, this information could be made publicly available via an updated version of the Truck Buyer s Guide website as a basis for operators to compare the fuel consumption and CO 2 emissions of new heavy vehicles, similar to the Green Vehicle Guide website for light vehicles. Currently the Truck Buyer s Guide only provides general information to help operators purchase a fuel efficient vehicle. The Department notes however, that similar provisions do not exist in the equivalent US or Japanese emission standards, so the ability to compare such vehicles would be limited if these standards were accepted as alternatives under ADR 80/04. While it may be technically possible for US and Japanese manufacturers to provide similar information, as they are subject to fuel economy standards in the US and Japan, differences in the test cycles would also affect the comparability of such information. It would also only be available for those vehicles sold in both Australia and US/Japanese markets. Questions 9. Should the Euro VI provisions requiring manufacturers to report engine fuel consumption and CO 2 emissions be adopted in ADR 80/04? 10. Would there be merit in making this information publicly available? 11. If these provisions were adopted and the information was made publicly available, do you consider that it would be necessary for all new heavy vehicles to meet Euro VI requirements to provide a common basis for comparison? 26

29 Appendix 1 Urban air quality in Australia Urban air quality is comparably good in Australia by international standards. Australia s average urban concentration of PM 10 (particulate matter smaller than 10 micrometres) is 18µg/m 3, which is below the maximum limit of 20µg/m 3 recommended by the World Health Organisation. 37 Australia s ambient air quality is monitored by states and territories who report annually to the National Environment Protection Council (NEPC). The NEPC develops the National Environment Protection Measure (NEPM) for Ambient Air Quality, which set the Australian standards for levels of pollutants in the atmosphere. This NEPM has a desired outcome of the maintenance and improvement of ambient air quality. 38 A number of air pollutants are measured against NEPM standards in both urban and regional areas, with measurements taken in centres with a population of 25,000 or more. The NEPC also has separate reporting and monitoring arrangements in place for air toxics and diesel emissions. The Air Toxics NEPM goal is to improve the information base regarding ambient air toxics within the Australian environment in order to facilitate the development of standards. Under the Air Toxics NEPM monitoring is undertaken by jurisdictions and reported by the NEPC due to the growing recognition of the health impacts from these compounds. 39 Table A1 Current NEPM standards and goals for air pollutants Pollutant Averaging period Maximum concentration Carbon monoxide 8 hours 9.0 ppm 1 day a year Nitrogen dioxide Photochemical oxidants (as ozone) Sulfur dioxide 1 hour 1 year 1 hour 4 hours 1 hour 1 day 1 year 0.12 ppm 0.03 ppm 0.10 ppm 0.08 ppm 0.20 ppm 0.08 ppm 0.02 ppm Lead 1 year 0.50 µg/m 3 none Goal within 10 years Maximum allowable exceedences 1 day a year none 1 day a year 1 day a year 1 day a year 1 day a year none Particles as PM 10 1 day 50 µg/m 3 5 days a year Particles as PM day 1 year 25 µg/m 3 8 µg/m 3 Goal is to gather sufficient data nationally to facilitate a review of the Advisory Reporting Standards as part of the review of this Measure scheduled to commence in 2005 Note: Allowable exceedences apply for each monitoring station. An exceedence day as reported in figures 2 and 3 is a day where at least one monitoring station in the airshed has reported an exceedence of the NEPM standard. A capital city may still meet the NEPM goal on station by station basis, if different stations reported exceedences on different days. 27

30 Number of days exceeded Most pollutants are consistently below NEPM standards and have fallen consistently over the last twenty years. Of the six ambient air pollutants that are monitored through the NEPM (CO, nitrogen dioxide (NO 2 ), photochemical oxidants (as ozone), sulfur dioxides, lead and particulate matter (PM 10 and PM 2.5 )), only photochemical oxidants and PM 10 regularly exceed the NEPM goals. Nevertheless, in the 2011 State of the Environment report, the ambient air quality scorecard rated all the major cities in a good or very good category for ozone and PM While this is encouraging, a recent review of the Ambient Air Quality NEPM noted that a number of epidemiology studies suggest that there is no clear threshold at which air pollutants cease to have adverse health impacts, so even exposures below the NEPM standards cannot necessarily be considered to be safe. 41 Figures A1 and A2 (on the next page) show the number of exceedences of the NEPM standards in the four largest capital cities for ozone, which are strongly influenced by VOC and NOx emissions from motor vehicles. Figure A1 - Number of days NEPM 1hr Ozone Standard (0.10ppm) exceeded in the four largest Australian capital cities 42 Sydney Melbourne Brisbane Perth 28

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