Vehicle Fuel Economy:

NHTSA and EPA's Partnership for Setting Fuel Economy and Greenhouse Gas Emissions Standards Improved Analysis and Should Be Maintained

GAO-10-336: Published: Feb 25, 2010. Publicly Released: Apr 1, 2010.

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In May 2009, the U.S. administration announced plans to increase the Department of Transportation's (DOT) National Highway Traffic Safety Administration's (NHTSA) corporate average fuel economy (CAFE) standards and establish the Environmental Protection Agency's (EPA) greenhouse gas (GHG) emissions standards for vehicles. NHTSA redesigned CAFE standards for light trucks for model years 2008 through 2011, and some experts raised questions about the rigor of the computer modeling NHTSA used to develop these standards. GAO was asked to review (1) the design of NHTSA and EPA's proposed standards; (2) how they are collaborating to set these standards; (3) improvements compared to a previous rulemaking, if any, NHTSA made to the modeling; and (4) the extent to which NHTSA analyzed the effects of past light truck standards and the accuracy of data used to set them. GAO reviewed relevant rulemaking and modeling documents, and interviewed agency officials and other experts.

NHTSA and EPA have worked to propose CAFE and GHG standards that are generally aligned so manufacturers can build a single fleet of vehicles to comply with both. The standards are based on vehicle size and will cover model years 2012 to 2016. However, differences between the standards still exist because of variation in the legal authorities of each agency. For example, certain flexibility mechanisms designed to reduce compliance costs for manufacturers apply only to GHG standards, which could make aligning them with CAFE standards more difficult. However, potentially stricter penalties for GHG standard noncompliance could improve compliance with CAFE standards. Also, while NHTSA and EPA expect benefits from adopting a standard based on vehicle size, neither standard has a mechanism to ensure that a specific national target will be met. NHTSA and EPA are collaborating by sharing resources and expertise to jointly set CAFE and GHG standards. From fiscal years 1996 through 2001, NHTSA was barred from using appropriated funds to raise CAFE standards. In contrast, EPA has continually expanded its automotive engineering expertise, including at its vehicle testing lab. As a result, EPA was able to contribute several original research studies to the proposed joint standards. Because this collaboration is not formally required and the agencies are not documenting the processes used--a recognized best practice--they may not be able to replicate them in the future. To set the proposed standards, NHTSA improved upon the computer model compared to the version used that had been used to set the CAFE standards for 2008 through 2011 light trucks. One improvement was that NHTSA increased the model's transparency by using publicly available, rather than confidential, data to develop a baseline fleet of vehicles. With EPA's input, NHTSA updated several data inputs such as technology costs and the cost of emissions. While experts GAO interviewed had varying critiques of NHTSA's model, there was no consensus on how NHTSA could further improve it. In particular, experts' opinions differed sharply on two studies, which reported opposing findings concerning the relationship between vehicle weight (a key factor in determining fuel consumption) and safety--suggesting that additional research may be warranted. In part due to resource and data constraints, NHTSA has not yet evaluated its 2008 through 2011 light truck CAFE standards, which have a similar design to the new standards. Retrospective analyses of efforts and data inputs could inform NHTSA on the extent to which the standards met goals and provide means to improve the process of setting standards. Lacking such analysis, NHTSA does not know whether goals of the standards have been met or if changes are needed to the program. NHTSA officials said that while they would like to conduct such analyses, limited resources and time have prevented them from doing so, and they have no definitive plans to conduct them in the future.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: NHTSA and EPA should document the process used in this joint rulemaking to establish a roadmap for any future rulemaking efforts and facilitate future collaboration. In addition, NHTSA and EPA should publish this documentation in order to increase transparency.

    Agency Affected: Environmental Protection Agency

    Status: Closed - Implemented

    Comments: In 2010 we reported that the Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) successfully collaborated on a joint rulemaking on vehicle fuel economy and greenhouse gas emissions standards for vehicle model years 2012 to 2016. However, we noted that the agencies did not document the process used for the rulemaking and that if the agencies collaborated together on future joint rulemakings the lack of a documented process could create inefficiencies in additional time spent recreating processes and reduced sharing of expertise and resources, thus resulting in less rigorous analyses supporting the rulemaking. We recommended that EPA and NHTSA, in order to better ensure effective collaboration on future joint rulemakings, establish a roadmap for future collaborations by documenting and publishing a description of collaborative process used in the 2012 to 2016 joint rulemaking. In 2011 EPA and NHTSA published a rule for vehicle fuel economy and greenhouse gas emissions for vehicle model years 2017 to 2025. This rule provided a roadmap through its detailed description of the joint process used by EPA and NHTSA, including relevant rules and responsibilities. As a result, EPA and NHTSA can continue to follow the documented process, as opposed to recreating a collaborative process, in the future to better ensure effective collaboration on joint rulemakings.

    Recommendation: NHTSA and EPA should document the process used in this joint rulemaking to establish a roadmap for any future rulemaking efforts and facilitate future collaboration. In addition, NHTSA and EPA should publish this documentation in order to increase transparency.

    Agency Affected: Department of Transportation: National Highway Traffic Safety Administration

    Status: Closed - Implemented

    Comments: In 2010 we reported that the Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) successfully collaborated on a joint rulemaking on vehicle fuel economy and greenhouse gas emissions standards for vehicle model years 2012 to 2016. However, we noted that the agencies did not document the process used for the rulemaking and that if the agencies collaborated together on future joint rulemakings the lack of a documented process could create inefficiencies in additional time spent recreating processes and reduced sharing of expertise and resources, thus resulting in less rigorous analyses supporting the rulemaking. We recommended that EPA and NHTSA, in order to better ensure effective collaboration on future joint rulemakings, establish a roadmap for future collaborations by documenting and publishing a description of collaborative process used in the 2012 to 2016 joint rulemaking. In 2011 EPA and NHTSA published a rule for vehicle fuel economy and greenhouse gas emissions for vehicle model years 2017 to 2025. This rule provided a roadmap through its detailed description of the joint process used by EPA and NHTSA, including relevant rules and responsibilities. As a result, EPA and NHTSA can continue to follow the documented process, as opposed to recreating a collaborative process, in the future to better ensure effective collaboration on joint rulemakings.

    Recommendation: To ensure continued collaboration and an enhanced relationship in any future CAFE and GHG emissions rulemakings, NHTSA and EPA should enter into a Memorandum of Understanding with one another in which the agencies agree to continue their enhanced partnership in any future CAFE and GHG rulemakings.

    Agency Affected: Environmental Protection Agency

    Status: Open

    Comments: When EPA provides information regarding the status of its efforts to address this open recommendation, we will update this information.

    Recommendation: To ensure continued collaboration and an enhanced relationship in any future CAFE and GHG emissions rulemakings, NHTSA and EPA should enter into a Memorandum of Understanding with one another in which the agencies agree to continue their enhanced partnership in any future CAFE and GHG rulemakings.

    Agency Affected: Department of Transportation: National Highway Traffic Safety Administration

    Status: Open

    Comments: When DOT provides information regarding the status of its efforts to address this open recommendation, we will update this information.

    Recommendation: NHTSA and EPA, with input from key stakeholders, should conduct or sponsor new research on safety and its relationship to vehicle size and weight, given the controversy and lack of consensus regarding the relationship between vehicle size, weight, and safety and the emergence of new strong-but-lightweight materials among experts and stakeholders.

    Agency Affected: Environmental Protection Agency

    Status: Closed - Implemented

    Comments: In 2009, the Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) proposed, through a joint rulemaking, corporate average fuel economy and greenhouse gas emissions standards for passenger vehicles model years 2012 to 2016. In 2010, we reported that while vehicle weight is a key factor in determining vehicle fuel economy and greenhouse gas emissions standards, there was a lack of consensus among experts and stakeholders regarding the relationship between vehicle weight, and safety. As a result, we recommended that the EPA and the National NHTSA should, given the potential effects of fuel economy standards on vehicle size and weight and safety, conduct or sponsor new research on the relationship between vehicle size and weight and vehicle safety. In December 2011 EPA and NHTSA issued a joint rulemaking for corporate average fuel economy and greenhouse gas emissions standards for passenger vehicle model years 2017 to 2025. This joint rulemaking describes the research on vehicle weight and safety that has been sponsored by EPA and NHTSA and led by a variety of organizations including NHTSA, the Department of Energy, private contractors, universities, and the California Air Resources Board. As a result of this research, EPA and NHTSA will better understand how, for example, vehicle weight and size can be reduced in order to improve fuel economy without compromising vehicle safety and, as a result, how vehicle fuel economy and greenhouse gas emission standards affect vehicle safety.

    Recommendation: NHTSA and EPA, with input from key stakeholders, should conduct or sponsor new research on safety and its relationship to vehicle size and weight, given the controversy and lack of consensus regarding the relationship between vehicle size, weight, and safety and the emergence of new strong-but-lightweight materials among experts and stakeholders.

    Agency Affected: Department of Transportation: National Highway Traffic Safety Administration

    Status: Closed - Implemented

    Comments: In 2009, the Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) proposed, through a joint rulemaking, corporate average fuel economy and greenhouse gas emissions standards for passenger vehicles model years 2012 to 2016. In 2010, we reported that while vehicle weight is a key factor in determining vehicle fuel economy and greenhouse gas emissions standards, there was a lack of consensus among experts and stakeholders regarding the relationship between vehicle weight, and safety. As a result, we recommended that the EPA and the National NHTSA should, given the potential effects of fuel economy standards on vehicle size and weight and safety, conduct or sponsor new research on the relationship between vehicle size and weight and vehicle safety. In December 2011 EPA and NHTSA issued a joint rulemaking for corporate average fuel economy and greenhouse gas emissions standards for passenger vehicle model years 2017 to 2025. This joint rulemaking describes the research on vehicle weight and safety that has been sponsored by EPA and NHTSA and led by a variety of organizations including NHTSA, the Department of Energy, private contractors, universities, and the California Air Resources Board. As a result of this research, EPA and NHTSA will better understand how, for example, vehicle weight and size can be reduced in order to improve fuel economy without compromising vehicle safety and, as a result, how vehicle fuel economy and greenhouse gas emission standards affect vehicle safety.

    Recommendation: NHTSA should conduct and document a retrospective analysis of the model year 2008 through 2011 light truck standards, given the potential impact of CAFE standards on the automobile industry and consumers. In addition, NHTSA should identify opportunities to evaluate the accuracy of key estimates, such as technology costs, used to determine the model year 2008 through 2011 light truck standards. As EPA has experience conducting retrospective analyses of regulatory programs, NHTSA should consider involving EPA in this process.

    Agency Affected: Department of Transportation: National Highway Traffic Safety Administration

    Status: Open

    Comments: When DOT provides information regarding the status of its efforts to address this open recommendation, we will update this information.

    Recommendation: NHTSA should set delivery time frames for future National Academy of Sciences (NAS) studies to ensure the availability of these studies in a time frame useful for incorporation in NHTSA's regulatory analyses.

    Agency Affected: Department of Transportation: National Highway Traffic Safety Administration

    Status: Open

    Comments: NHTSA has initiated two contracts with the National Academies of Sciences (NAS) for studies related to corporate average fuel economy (CAFE) standards. Delivery timeframes for these two studies have been set to ensure that they are available in a timely manner to inform NHTSA's future CAFE rulemakings. One study is due to be issued by January, 2015 in advance of NHTSA's efforts to set CAFE standards for model years 2022 to 2025. In addition, NHTSA continues to monitor the status of these studies and attends open NAS meetings associated with them.

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