Last week, Administrator Whitman testified before this Committee on other air pollution matters. I would like to begin by re-stating her opening words. The United States should take great pride in the progress we have made in reducing pollution at the same time that we have had impressive economic growth. Over the last 30 years, we have reduced emissions of six key air pollutants by over 30 percent, at the same time that the gross domestic product has increased almost 150 percent, vehicle miles traveled have increased 150 percent, and energy consumption has increased over 40 percent. This success story was made possible by American ingenuity spurred in large part by legislation that recognized the importance of a clean environment.
In general, transportation sources contribute roughly half of the remaining overall pollution in our air. The contribution, however, can vary significantly among individual pollutants and from one city to another. Note that when I refer to transportation sources I mean all highway motor vehicles as well as mobile off-road sources. They are major sources of four pollutants, contributing 56 percent of the total U.S. emissions of oxides of nitrogen (NOx), 77 percent of the carbon monoxide (CO), 47 percent of the volatile organic compounds (VOCs), and 25 percent of the particulate matter (PM10).
What Has Been Accomplished
CLEAN VEHICLES
Let me begin by discussing motor vehicles. Cars being built today are well over 90 percent cleaner than cars built in 1970. This is a result of a series of emission control programs, in many cases authorized by Congress, and fully implemented by EPA through nationally-applicable regulations. Since the first tailpipe standards took effect in the 1970's, there have been increasingly more stringent standards; most recently Tier 1 in the mid-90's; NLEV, which is in effect today; and Tier 2 standards set to take effect beginning with the 2004 model year.
Today, the auto industry is supportive of the Tier 2 standards which are about 90 percent cleaner than Tier 1. This is a good example of how EPA's relationship with the auto industry has changed over the past decade from largely confrontational to cooperation and support. We are pleased with this development and hope to foster an even better relationship with the auto industry as we seek solutions to challenging environmental problems in the future. We are also working hard to build a similar sense of constructive cooperation with other transportation-related industries, particularly the fuels industry.
Let me highlight a few additional points about the Tier 2 program. Tier 2 will take a major step toward reconciling passenger vehicles with clean air. For the first time it holds SUVs, minivans and pick-up trucks to the same emission requirements as autos. Previously, light trucks had a less stringent standard, because it was recognized that some were used for commercial purposes. Tier 2 is also fuel neutral, which means that gasoline, diesel and alternative fueled vehicles all must meet the same set of standards. Tier 2 is cost effective and its benefits to public health are large over two million tons of NOx emissions avoided per year by 2020, 4,300 premature deaths prevented annually and tens of thousands of respiratory illnesses prevented.
In addition to reducing tailpipe pollutants, EPA has set tight limits on the amount of gasoline vapors which may be emitted when vehicles are operating, being refueled or parked on a summer day. Another system in place on 1996 and later vehicles utilizes the onboard computer and a series of sensors to monitor the operation of a vehicle's emission control equipment. Called onboard diagnostics, or OBD, this self-diagnostic system illuminates a dashboard light when a problem occurs.
All of the programs I have just described impose requirements on auto companies to improve the emissions performance of new cars and light trucks. Of course, motorists share responsibility to properly maintain their vehicles and not tamper with emission control equipment. Inspection and maintenance (I/M) programs, currently operating in 56 metropolitan areas, are meant to identify polluting vehicles and require their repair. Although EPA has established performance requirements for I/M programs, states are responsible for adopting and implementing the programs. States have a great deal of flexibility in designing these programs.
A recent report from the National Research Council makes two points about I/M programs. First, the review committee states that "it's important to emphasize that these programs are absolutely necessary to reduce harmful auto emissions and achieve better air quality." Second, they find the programs are not as successful as EPA and states have estimated. We generally agree with the findings of the report and have already taken actions to adopt many of the NRC recommendations. The primary reason that I/M programs may not be as effective as EPA and the states had originally projected is that emissions control systems of late model cars deteriorate less than those on older cars. The auto companies are building more durable vehicles and that is good environmental news. We have also learned an important lesson from our efforts to implement a program such as I/M which so directly affects the public. We now know that the best approach for programs that are not national in scope is to allow state and local governments broad flexibility in meeting environmental goals. Trying a one-size-fits-all approach, for example, by forcing all states to adopt centralized I/M programs, was not the way to go. We have learned a valuable lesson from this experience and will use that knowledge in designing future programs.
Most large trucks and buses are powered by diesel engines. They can emit high levels of NOx and PM. Although cars were regulated first, diesel truck and bus manufacturers have had to comply with a series of increasingly more stringent standards beginning in the late 1980's. A major new program has just been established that will protect public health and the environment while ensuring that diesel trucks and buses remain a viable and important part of the Nation's economy. This program was affirmed by the new Administration in February. Beginning in 2007, the makers of diesel engines will for the first time install devices like catalytic converters on new trucks and buses to meet the emission performance standards. When fully in place in 2030 the environmental benefits are substantial 2.6 million tons of NOx emissions will be avoided every year, 8,300 premature deaths prevented annually, and 23,000 cases of bronchitis and 360,000 asthma attacks. These health benefits far outweigh the cost to produce the cleaner engines and fuels. CLEAN FUELS
Let me now switch from cleaner vehicles to cleaner fuels. The first effort to address an environmental problem linked to fuel was the multi-year effort to phase down and eventually eliminate lead in gasoline. That successful action was followed by other programs to require oil refiners to produce cleaner gasoline. In the late 1980's refiners began to reduce the evaporation rate of gasoline nationwide during the summer months. Included in the 1990 amendments to the Clean Air Act were several new clean fuel programs required by Congress. One required a modest reduction in the amount of sulfur in highway diesel fuel. Another required all gasoline sold in CO nonattainment areas to contain an oxygenated additive during winter months. This has proven successful in reducing CO tailpipe emissions, particularly in older vehicles. Most of the wintertime oxygenated fuels programs that remain today use ethanol as the additive.
In the 1990 amendments Congress also established the reformulated gasoline (RFG) program. The RFG program was designed to serve several goals. These include improving air quality and extending the gasoline supply through the use of oxygenates. Congress established the overall requirements of the RFG program by identifying the specific cities in which the fuel would be required, the specific performance standards, and the oxygenate requirement. Today, roughly 35 percent of this country's gasoline consumption is cleaner-burning RFG. Neither the Clean Air Act nor EPA requires the use of any specific oxygenate in RFG. Both ethanol and MTBE are used in the RFG program, with fuel providers choosing to use MTBE in about 87 percent of the RFG. Ethanol is used in 100 percent of RFG in Chicago and Milwaukee, which are closer to major ethanol production centers.
Ambient monitoring data from the first year of the RFG program (1995) indicated that RFG had a positive impact on reducing toxic emissions. RFG areas showed significant decreases in vehicle-related tailpipe emissions. One of the air toxics controlled by RFG is benzene, a known human carcinogen. The benzene level at air monitors in 1995, in RFG areas, showed the most dramatic declines, with a median reduction of 38 percent from the previous year. The emission reductions which can be attributed to the RFG program are equivalent to taking 16 million cars off the road.
The RFG program with an oxygenate additive has been a successful air pollution control program. An unintended consequence, however, has been the contamination of numerous ground water and drinking water supplies. I will address this issue later in my testimony.
In two of the programs I mentioned earlier, Tier 2 and the 2007 diesel program, EPA recognized the efficiencies of addressing vehicles and fuels as a system when establishing an emissions control program. Thus, in addition to setting strict exhaust emission standards for the vehicles and engines, we also required that cleaner, low sulfur gasoline and diesel fuel be available to enable those emission standards to be achieved. Sulfur is similar to lead in that it degrades the effectiveness of a catalytic converter. The Tier 2 and diesel regulations provide sufficient time for refiners to make the necessary modifications to their facilities before the low sulfur fuel is required. EPA has included a number of provisions that provide additional flexibility to refiners, particularly small refiners.
OFF-ROAD ENGINES
As emissions from highway vehicles are reduced, the potential for reductions from other sources must be evaluated. Therefore, in 1990 Congress instructed EPA to study the contribution of all categories of off-road engines and equipment to urban air pollution. Congress also gave EPA for the new authority to set emission limits for these sources. As a result of our findings that certain categories of off-road engines contribute to air pollution in nonattainment areas, EPA has put in place emission control programs for the following off-road equipment: locomotives, large diesel engines used in construction and agricultural equipment, marine vessels, outboard recreational boats, and small gasoline engines used in lawn and garden equipment.
In September of this year EPA will propose rules for public review and comment on other categories of off-road engines, including large gasoline and gaseous-fueled engines used in industrial equipment, such as forklifts. It will also address several types of recreational vehicles, such as all terrain vehicles, snowmobiles and off-road motorcycles. Finally, it will seek comment on whether EPA should tighten the emission standards for highway motorcycles, which have been unchanged since 1978.
Virtually all of the control programs I have discussed thus far not only reduce emissions that cause nonattainment with the NAAQS but also significantly reduce toxic air pollutants. For example, compared to 1990 levels, the programs we have in place today for highway vehicles, including Tier 2 and the 2007 diesel rule, will reduce emissions of four gaseous toxic pollutants by about 350,000 tons by 2020, a 75 percent reduction. Diesel PM from highway vehicles will be reduced by 220,000 tons over the same time frame, for a 94% reduction. To further address the growing concern of public exposure to toxic air pollution, EPA recently identified 21 chemicals as mobile source air toxics. These include various compounds that are emitted from mobile sources, including several volatile organic compounds (VOCs) and metals, as well as diesel particulate matter plus diesel emission organic gases. We also completed a regulation which controls the toxic emissions from gasoline.
One of the points I want to make in summarizing the accomplishments of our motor vehicle emissions reduction program is an acknowledgment of the success of our industry partners in meeting these requirements. Many of these programs set challenging performance standards but, almost across the board, to date auto makers, oil refiners, engine and equipment manufacturers and other businesses have met the challenge, in some cases sooner and cheaper than anyone had anticipated.
Over the past 30 years EPA has become smarter and has changed its way of doing business. We now have:
more and earlier involvement of stakeholders
incentives for early reductions
flexibility for implementation, for example, through phase-in rather than forcing all models to meet a new standard in one model year, and allowing banking and trading of emission credits
special provisions for small businesses, for example, we have convened 4 small business advocacy review panels under the Small Business Regulatory Enforcement Fairness Act and incorporated a number of panel recommendations in our final regulations
a new sensitivity to the market impacts of our programs
Our goal is to use the lessons we have learned over the years to make our programs even more effective in the future. Equally important, we plan to utilize these new approaches to tackle the challenges we have facing us today. I will talk about those now.
What Remains to be Done
HEALTH EFFECTS FROM AIR POLLUTION
Pollutants which are directly emitted by transportation sources are NOx, VOCs, fine particulate matter (PM2.5), and CO. In the presence of sunlight, NOx and VOCs react photochemically to produce ozone. NOx can be transported long distances and contribute to ozone many hundreds of miles from its source. More than 97 million people live in areas that do not yet meet the health-based 1-hour ozone standard (based on 1997-1999 data). The number would be even higher for the new 8-hour ozone standard. Reducing ozone levels will result in fewer hospitalizations, emergency room and doctors visits for asthmatics, significantly fewer incidents of lung inflamation for at-risk populations, and significantly fewer incidents of moderate to severe respiratory symptoms in children.
Not only will reducing ozone provide public health benefits, but it will avoid damage to ecosystems and vegetation. Ozone causes decreased agricultural and commercial forest yields, increased mortality and reduced growth of tree seedlings, and increased plant susceptibility to disease, pests, and environmental stresses (e.g., harsh weather). Since NOx emissions result in formation of ground-level ozone, reducing NOx emissions will reduce ozone levels and thus reduce the deleterious effects of ozone on human health and ecosystems.
All particulate matter emitted from the transportation sector is "fine" particulate, which means it is be deposited deep in the lungs when breathed in the ambient air. A substantial body of published scientific literature recognizes a correlation between elevated fine particulate matter and increased incidence of illness and premature mortality. The health impacts include aggravation of chronic bronchitis, hospitalizations due to cardio-respiratory symptoms, emergency room visits due to aggravated asthma symptoms, and acute respiratory symptoms. Based on these findings, EPA and others estimate that attaining the fine particle standards would avoid up to tens of thousands of premature deaths annually.
The significant expansion in scientific research in recent years has enhanced our understanding of the effects of particles on health. EPA is summarizing all new information in the ongoing review of the particulate matter standard in a "criteria document" that will undergo extensive peer and public review.
EPA PRIORITIES
The first priority of EPA is to assure smooth implementation of programs whose regulations are set but are not yet in effect. Tier 2 is one such program, but even here we are very pleased that auto companies have certified four vehicle models to Tier 2 standards more than two years ahead of schedule. Additionally, some oil companies are already selling cleaner, low sulfur gasoline in cities around the country. The 2007 diesel program is another example in which some companies are moving ahead to introduce cleaner diesel engines and fuel, even though the core program requirements do not take effect for five or more years. EPA will conduct its own biennial assessment of progress being made toward implementation. In addition, EPA will request an independent review, which will monitor the progress of the engine manufacturers and the fuels industry in meeting the program requirements. This independent review will begin next year. The independent review will be conducted in an open, public process that will follow the requirements of the Federal Advisory Committee Act. A third example is our ongoing efforts to work with state officials who manage I/M programs and auto companies to efficiently incorporate the diagnostic capabilities of OBD systems into state I/M programs.
Another major environmental priority that must be addressed is whether or not MTBE will be a component of our Nation's future gasoline supply. As I mentioned previously, there is significant concern about contamination of drinking water in many areas of the country. Current data on MTBE in ground and surface waters indicate widespread and numerous detections of MTBE at low levels. Accordingly, EPA published last year an Advance Notice of Proposed Rulemaking requesting comments on a phase down or phase out of MTBE from gasoline under Section 6 of the Toxic Substances Control Act (TSCA). EPA believes that TSCA is the best regulatory process available for limiting or eliminating the use of MTBE. Eleven states have banned MTBE, one as early as the end of 2002. At least a dozen more states are considering similar bans.
The Clean Air Act authorizes states to regulate fuels through state implementation plans if EPA finds such regulations necessary to achieve a national air quality standard. States often use this authority to adopt clean fuel programs that provide significant air pollution reduction benefits. This has resulted in a number of different formulations being required by states which are often referred to as boutique fuels. Actions taken by a growing number of states to ban the use of MTBE as a gasoline additive is the single biggest factor that threatens to proliferate boutique fuel requirements around the country. EPA understands the challenge that state and local "boutique fuel" requirements place on the production and distribution of gasoline in the U.S. These state fuel programs could limit flexibility in the fuel distribution system, particularly if a disruption occurs. If the number of special fuels were limited, while maintaining needed air quality benefits, greater fungibility within the distribution system could possibly result.
The National Energy Policy report issued on May 17, 2001 includes a recommendation that directs EPA to study opportunities, in consultation with DOE, USDA and other agencies, to maintain or improve the environmental benefits of state and local "boutique" fuel programs while exploring ways to increase the flexibility and fungibility of the fuels distribution infrastructure, and provide added gasoline market liquidity. We have begun our boutique fuel assessment; we are consulting various stakeholders, including the states, and expect to make recommendations later this year.
The issues surrounding boutique fuels and the future of MTBE are both related to the statutory requirement that an oxygenate must be added to RFG. As I have mentioned, Congress established the oxygen requirement in 1990 to meet multiple goals: improve air quality, enhance energy security, and encourage the use of renewable fuels. We now know that some refiners can produce clean fuels without the use of oxygenates. Thus, there may be better ways to achieve these goals. EPA strongly supports the use of renewable fuels, such as ethanol, and a great deal of research in this area is being done by others in the Federal government.
As emissions from automobiles and trucks are significantly reduced in the future as a result of the Tier 2 and the 2007 heavy duty emission standards, in combination with the lower fuel sulfur levels, the next major category of mobile source emissions to be addressed is large diesel engines used in construction and agricultural equipment. Even though modest emission requirements are in place for this equipment, by 2020 the category will contribute over 10 percent of the total NOx emissions inventory in a typical metropolitan area and 8 percent of the PM emissions.
Our current plans in regard to these large, off-road diesel engines are to conduct an initial assessment of the environmental impacts and the feasibility and costs of future control technology in an EPA White Paper which we would release for public review by the end of this year. One of the major issues that needs to be considered is the potential need to lower the sulfur levels in off-road diesel fuel to enable new exhaust control technology to be utilized on future engines. As we found with highway vehicles, this approach of comprehensively looking at the engines and fuel as a system is appropriate here as well. Our plan would be to incorporate the information we receive from the public review of the White Paper into a formal, proposed rulemaking to be published sometime next year.
The programs I have discussed for reducing emissions from diesel engines affect newly produced engines only. But there are millions of older diesel trucks, buses and off-road equipment in use today, many of which spew noxious, black soot from their exhaust pipes. The hazards of diesel exhaust have been the subject of extensive medical research. At the end of last year, EPA's independent science advisory committee concluded that diesel exhaust is a likely human carcinogen. EPA has therefore initiated, in cooperation with manufacturers of diesel emission control systems, a major new initiative to install cost effective emission control equipment on older diesels. Called the Diesel Retrofit Program, the Agency's goal in this calendar year is to obtain commitment from businesses and municipalities that own fleets of trucks or buses to retrofit 100,000 vehicles with devices that will reduce exhaust emissions. I am pleased to report that we are already well over half way toward meeting this goal.
Here is one such commitment. Just three weeks ago, Administrator Whitman traveled to Seattle to participate in an event announcing a public-private partnership to clean up the existing fleet of diesel engines in the Seattle area through engine retrofits and the early introduction of ultra low sulfur fuels. Partners with EPA in the program include: the Puget Sound Clean Air Agency; the City of Seattle; King County; the Boeing Company; Tosco Refining; the Manufacturers of Emission Control Association; and the Diesel Technology Forum. Seattle's Diesel Solutions Partnership will deliver more than a 90 percent reduction in particulate matter and reduce air toxics in the fleet of retrofitted engines. As a result of this program, 25 percent of the 100 school bus fleet in Everett, Washington, will be low polluting, as well as a fleet of garbage and recycling trucks operating in Seattle neighborhoods.
To improve the analytical capabilities of air pollution control planners, the Agency has recently embarked on an effort to develop the New Generation Mobile Source Emissions Model. The objective is to develop a comprehensive modeling system for the estimation of mobile source emissions (both on and off-road). The system will estimate emissions in conjunction with the appropriate activity data for criteria pollutants, particulate matter, air toxics, and greenhouse gases. The modeling system will be developed in coordination with stakeholders and users and will incorporate peer review processes throughout its development.
Another important area of future work is the completion of a Technical Analysis Plan for possible further control of toxic air pollutants from transportation sources. This Plan, which EPA announced in December 2000, describes our continued research and analysis on mobile source air toxics. Based on the results of that research, EPA will conduct a future rulemaking to be completed by July 1, 2004, to promulgate any additional vehicle and fuel toxic controls that EPA determines are appropriate under the Act, including off-road sources.
Let me now turn to an approach to reducing transportation-related emissions that is quite different from EPA's traditional methods of setting regulatory requirements on vehicles, engines and fuels. This approach addresses the impact our transportation infrastructure has on air quality and explores voluntary actions to reduce vehicle travel. First, let me mention a concept that was include by Congress in the 1977 Clean Air Act Amendments and was significantly strengthened in 1990 transportation conformity. Simply stated, the transportation conformity provision of the Act requires that transportation planners coordinate with air quality planners to assure that new roads or expansions of existing roads will not worsen air quality. Although the goal is straightforward, the analytical and administrative procedures that must be followed to demonstrate that transportation plans "conform" to air quality plans in a given city or region are not so simple. EPA, in close partnership with our colleagues at the Department of Transportation, have worked closely with state, local and regional planners over the last several years to streamline the conformity regulations and reduce administrative burdens. The conformity program has been successful in getting transportation planners to work with air quality planners when highway projects are in the design stage, and in a number of cities around the country it has resulted in better projects that improve the transportation infrastructure while assuring no adverse impacts on air quality.
Now let me describe an exciting new initiative EPA is undertaking to address the growth in number of miles driven by American motorists as our economy continues to grow. In 1970 vehicle miles traveled, or VMT, was 1 trillion miles. By the late 1990's VMT had risen to 2.5 trillion miles, as more vehicles are driven more miles every year. The implication of this growth is that even as the emissions on a single car are dramatically reduced through new technology, the aggregate emissions from the entire U.S. fleet do not show a similar reduction simply because the number of cars on the road is continually growing. Directly related to that is the worsening traffic congestion in many of our metropolitan areas, with traffic jams becoming a fact of life, even in smaller towns. All of us are well aware of the increasing public concern with this problem. In response, we have initiated the Commuter Choice Leadership Initiative. This program promotes employer-provided commuting benefits by giving recognition, resources, tools and information to employers that meet a national standard of excellence in the commuting benefits they offer their employees. It is also a program that may potentially be used to achieve the goals of the conformity requirements I have just described.
Initially, EPA and DOT worked with a core group of employers (including Intel, Disney, Kaiser Permanente, and the City of Fort Worth) to develop the criteria for the national standard of excellence the keystone of this voluntary program. In mid-April, members of the federal team began outreach to employers, local, regional and state governments, transportation service providers and others, regarding the Commuter Choice Leadership Initiative program goals and requirements. To date, over 70 employers have joined the partnership with over 120,000 employees enjoying commuting benefits that meet the national standard of excellence. This number is constantly rising: every day new organizations join and our goal is to have 300 employers signed up by 2002. The Commuter Choice Leadership Initiative provides incentives for changing the standard American commuting pattern driving alone to work. The benefits that accrue especially reduced traffic congestion, improved air quality and reduced fuel consumption will enhance quality of life in communities across the nation.
Energy Issues Related to Environmental Programs
I would like to spend a few moments talking about vehicle fuel economy and EPA's role in this area. The transportation sector accounts for almost 70 percent of the U.S. oil consumption. This fact not only has implications on national energy policy, but also means that the transportation sector contributes almost one-third of the total U.S. greenhouse gas emissions, primarily in the form of CO2.
EPA has a significant role in the assessment of vehicle fuel economy. Our National Vehicle and Fuel Emissions Laboratory in Ann Arbor, Michigan, is the world's premier test center not only for emissions but also for fuel economy. Our engineers are involved in the development of advanced technologies to achieve cleaner, more fuel efficient motor vehicles. They also assess new technologies developed by the auto industry and other research facilities. In addition, EPA performs fuel economy testing on new models and reports this to the public at the start of each model year. EPA and DOE have created a website that provides consumers with easy access to fuel economy data. In addition, EPA has created the Green Vehicle Guide, a website which provides consumers who may be considering a new vehicle purchase with relative rankings of models by tailpipe emissions and gas mileage. The EPA mileage figures are also used on new car window stickers. EPA maintains the fuel economy database that provides data to the Department of Transportation about Corporate Average Fuel Efficiency compliance and identifies gas guzzler models to the Treasury Department for application of the gas guzzler tax.
Since the 1970s, EPA has also published the annual Fuel Economy Trends Report. Our latest report finds that, since 1975, the average auto fuel economy measured in miles per gallon (mpg) has doubled. This doubling, however, occurred entirely before 1987. For the past 14 years, new car fuel economy has been roughly unchanged. The average fuel economy of the new passenger vehicle fleet in 2001 model year is about 2 mpg below the 1988 peak. The primary cause of this declining trend is the increasing popularity of light trucks, a category that includes minivans, sport utility vehicles, and pick-up trucks. Because light trucks have to meet a less stringent fuel economy standard than other passenger vehicles, their growing numbers pull down the average of the entire fleet. However, within the past 12 months Ford has made a voluntary commitment to raise its average SUV fuel economy by 25 percent by 2005, and General Motors and DaimlerChrysler have said they would do better than Ford on light truck fuel economy.
Our most recent Trends Report notes that there appear to be advanced technologies that promise substantial increases in fuel economy. Hybrid power vehicles, which combine an internal combustion engine with an electric motor, have been introduced into the market by Honda and Toyota, while GM, Ford, and DaimlerChrysler have announced plans to introduce hybrids over the next several years. In the longer term, fuel cells offer tremendous potential to not only improve fuel economy but also reduce tailpipe pollutants, depending on the fuel that is used.
Summary
I have attempted to present a brief overview of the accomplishments of our national effort to improve the quality of the air we all breathe. This testimony has been focused on the transportation sector, which is a major part of the air pollution problem in this country, but which also has made tremendous advancements in reconciling transportation sources with environmental concerns. As I have mentioned, our work is not finished. Difficult air pollution problems remain and they will challenge the ingenuity of our industrial partners, our colleagues working for state and local governments, environmental and public health organizations and, most importantly, the continued support of the American public.
Mr. Chairman, that concludes my testimony. Thank you for the opportunity to make these remarks. I would be pleased to answer any questions the Committee members may have.