Report: Achieving the EPA's 2025 emissions goals could be 40 percent cheaper than expected

March 23, 2017

If you follow car news at all, you know that U.S. president Donald Trump has announced a review of the auto emissions regulations approved by the Environmental Protection Agency during the final days of the Obama administration. 

That news had many automakers cheering. They believe that the cost of developing and installing technology to meet the EPA's regulations would dramatically boost car prices, putting a dent in sales revenue. However, a new study suggests that the costs aren't nearly as high as projected--and in fact, they could be 40 percent lower. 

The study comes from the International Council on Clean Transportation, "an independent nonprofit organization founded to provide first-rate, unbiased research and technical and scientific analysis to environmental regulators." The ICCT is different from partisan groups in that it attempts to stick to facts and reasonable projections. Like the majority of scientists and engineers, the ICCT believes that climate change is real and that human activity is fueling it, but its approach to addressing such problems is refreshingly cautious and non-partisan.

The new study--catchily titled Efficiency technology and cost assessment for U.S. 2025–2030 light-duty vehicles--examines a wide range of new and emerging automotive technologies, their costs, and their ability to reduce auto emissions. Long story short, the ICCT suggests that creating and implementing clean-vehicle technologies to meet the EPA's emissions targets won't be free, but it will be significantly cheaper than expected.

How much cheaper? The ICCT's guess is anywhere from 34 percent to 40 percent lower than the EPA's own figures from the agency's recent mid-term assessment.

In dollar terms, that means that vehicles made for the 2022 to 2025 model years would be between $576 and $525 more expensive, rather than the EPA's internal estimate of $875.

Why the difference? The ICCT says that it comes down to three key factors:

Tiny improvements add up: Small tweaks to conventional vehicles may not seem like a big deal, but combined, they can generate big emissions cuts. The study cites technologies like cylinder deactivation, lightweighting (e.g. building vehicles from lighter materials, like aluminum), and mild hybridization, which are becoming increasingly popular.  

Costs are coming down: New technologies are almost always expensive, but they become much cheaper over time, as economies of scale and market competition kick in. The ICCT projects that in the near future, costs related to lightweighting, direct-injection, and even electrification will be up to 40 percent cheaper than EPA estimates.  

No big changes are needed: Most of the technologies mentioned in the ICCT report affect all sorts of cars, not just electric ones. They can be applied to the conventional, combustion-engine vehicles that today's consumers like. If those technologies become better and cheaper, shoppers wouldn't need to change their buying habits for automakers to reach EPA goals. Consumers could continue purchasing the sorts of cars, trucks, and SUVs they're buying today, and companies could still hit emissions targets.

Will the study have any effect on the EPA's review? We can't say, but the science seems good, and the auto industry would need plenty of alternative data to counter it. (Remember, any change to EPA regulations has to be supported by science.)

Frankly, the bigger question might be: will California and foreign countries make any EPA rollback moot? 

You can download a PDF of the ICCT report here.

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