MECA Market Growth Road Map

MECA Market Growth Road Map

June 2007

North America / Other Countries/Regions
Regulatory Item/
Status / Impact/
Priority / Current MECA Actions
And
Market Data / Additional Actions to Consider / Likelihood/
Threats / Other Countries/
Regions Impacted by 2005/2010 / Current MECA Actions / Additional Actions to Consider
LDVs/LDTs

Tier 2 Standards

eff. 2004-2009
(
LEV II Standards
eff. 2004-2009
(
ZEV Program
eff. 2005-2020
( / Creates opportunities for catalyst-based technologies, PM filters, thermal management strategies, engine/fuel controls, OBD technologies, evap. emission controls; fully phased-in Tier 2 creates equivalent standards for PCs, LDTs, and MDPVs (fuel neutral) / Actions
Support the rule

1. Technical Support and information (TS&I)
   2. APBF-DEC

3. CRC light-duty diesel programs
4. MECA Tier 2/LEV II WP

Market Data

LDV/LDT U.S. sales in 2005
ca. 17 million / Standards for gasoline LDVs and low sulfur gasoline limits appear secure.
Some risk that the standards for diesel LDVs could come under attack in Congress or by the Admin. / European Union (EU), Mexico, Brazil, Argentina, Chile, China, India, Korea, Thailand, Taiwan, Australia and Japan /

1. Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ

2.Clean Fuels and Vehicles Partnership (CFVP)
3.AVECC 2006

Tier 3/LEV III

EPA: no action

ARB: proposal 2008

eff. post-2010
( / Creates additional opportunities for LDV emission control technologies and OBD technologies /

Actions

Support rule development

1. TS&I

2.MECA SUV
test program

Market Data

LEV ca. 30% of U.S. / 1. MECA LDD SULEV test program / CA needs all available reductions but may be reluctant to tackle LDVs again; ozone std. review may push EPA to act / EU,Japan, Korea first / 1.Coordination with AECC and CMAJ
Greenhouse Gas Emission Standards
EPA: may act in 2008
ARB: adopted 2004.
eff. phase-in 2009
( / May create additional opportunities for advanced LDV emission control technologies; interest in Northeast & West Coast states / Actions
Monitor developments

1. 1. TS&I

Market Data
ca. 2 million LDV/LDT sold in CA annually / ARB rule faces legal challenges; Congress keen to act on GHG limits; Supreme Court rules EPA has authority / Canada, EU, and Japan / 1.Coordination with AECC and CMAJ
Motorcycles
EPA: eff. 2006/2010
(
ARB: eff. 2004/2008
( / EPA finalized rule in Dec. 2003 providing additional opportunities for TWCs and low permeation fuel systems; ARB may revisit in 2008-09 / Actions
Monitor developments

1. 1. TS&I

Market Data
Estimated U.S. total sales of approx. 1 million in 2004 / 1. Revise Motorcycle WP / Mexico, Brazil, Argentina, Chile, India, China, Taiwan, Thailand, Vietnam, and Japan /

1. Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ
2. Clean Fuels and Vehicles Partnership (CFVP)
3. AVECC 2006

A/M Conv. OBD

EPA: interim policy
final: no date
(
ARB: interim policy
final: 2006;
ARB: OBD-compliant-
only product: 2007
rulemaking
( / Creates opportunities for value-added converter products; interest outside of CA for opt in to ARB regs. (non-attainment areas) /

Actions

Support rulemaking/support interest outside of CA

1. TS&I

Market Data
3.4 million A/M converters manufactured for sale in N.A. (2004) / 1.Revise A/M WP
2. MECA MIL test program to support ARB reg. change / Rule expected to be adopted; the question is when / EU, Mexico, Brazil, Argentina, Chile, China, India, Taiwan, Thailand, Australia, Korea, and Japan / 1. Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ / 1. Revise A/M WP
North America / Other Countries/Regions
Regulatory Item/
Status / Impact/
Priority / Current MECA Actions / Additional Actions to Consider / Likelihood/
Threats / Other Countries/
Regions Impacted by 2005/2010 / Current MECA Actions / Additional Actions to Consider
Upgrade Conv.
ARB: test program
( / Creates opportunities for increased sale of OBD-compliant aftermarket converters; interest outside CA in non-attainment areas /

Actions

Support the initiative

1. TS&I

2. Seek support for rulemaking outside of CA

Market Data

ca. 6-8 million 1984-1994 LDV in CA / 1.Revise Upgrade White Paper / ARB likely to cancel program,benefits difficult to quantify due to variability of in-use vehicles / EU, Mexico, Brazil, Argentina, Chile, China, India, Taiwan, Thailand, Australia, Korea, and Japan / 1. Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ / 1. Revise Upgrade White Paper
On-Road HDEs
Phase II Standards
EPA: eff. 2007-2010
(
ARB: eff. 2007-2010
( / Creates opportunities for PM & NOx controls, crankcase emission controls on diesels; catalyst and engine/fuel controls on gasoline and alternative fuel engines; opportunities for OBD technologies
(starting 2010) / Actions
Support the rule, technology reviews will continue
1. TS&I
2. MECA filter maintenance WP
3. APBF-DEC
4. EPA in-house test program

Market Data

Est. U.S. Sales in 2004:
LHD 433,787
MHD 226,706
HHD 227,877 / 1. Additional NOx durability data; mayneed MECA input
2. Filter durability data / EPA 2007 implementation on track; success critical for 2010
Technological feasibility important for 2010 standards; NTE & OBD critical
ATA could seek delays in 2010 implementation / EU, Mexico, Brazil, Argentina, Chile, China, India, Taiwan, Thailand, Australia, Korea, and Japan / 1.Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ
2.Clean Fuels and Vehicles Partnership (CFVP)
3. AVECC 2006
North America / Other Countries/Regions
Regulatory Item/
Status / Impact/
Priority / Current MECA Actions / Additional Actions to Consider / Likelihood/
Threats / Other Countries/
Regions Impacted by 2005/2010 / Current MECA Actions / Additional Actions to Consider
Off-Road Engines
Nonroad CI Engines
EPA: final 2004; eff. 2008-2015
(
ARB: followed EPA in 2004
( / Creates opportunities for PM, NOx controls, crankcase emission controls,
engine/fuel controls, OBD technologies on diesel/alt. fuels / Actions
Support the rulemaking
1.TS&I
2.Nonroad CI White Paper (WP)
3. EPA/MECA DOC test program

Market Data

EPA estimates >800,000 engines sold annually in N.A. / 1. Small Engine
Adv. PM/NOx will be subject of 2007 technology review – need inputs on technology options for small engines
2. Non-road diesel technology demonstrations / Currently, a strong rule has been adopted; industry interference is likely; on-road experience will impact rule; technology review targeted for 2007 / EU, Mexico, Brazil, Argentina, Chile, China, India, Taiwan, Thailand, Australia, Korea, and Japan / 1.Coordination with AECC, CVEC, ECMA, and AFEEVAS
2.Clean Fuels and Vehicles Partnership (CFVP)
3.AVECC 2006
4.Nonroad CI WP
Nonroad SI Engines >25 hp
EPA: eff. 2004-2007
(
ARB: final 2006
eff. 2007-2016
retrofit: 2007
( / Creates opportunities for three-way catalyst, engine/fuel management, evaporative emission technology
ARB standard includes low emission stds. for new lift trucks & retrofits
EPA may follow ARB’s lead for future low emission stds. / Actions
Support the rulemaking

1. TS&IWP

Market Data

EPA estimates annual U.S. sales at approximately 150,000 units (ca. 40,000 fork lifts in CA) / 1.Nonroad SI Engine WP / CA standards for new engines & retrofits adopted; timing for any future action by EPA uncertain / EU, Mexico, Brazil, Argentina, Chile, China, India, Taiwan, Japan, Thailand, Australia, and Korea / 1.Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ
2.CFVP
3. Nonroad SI WP / 1.Nonroad SI Engine WP
2 Potential propane lift-truck test program
Recreational SI Engines
EPA: eff. 2006-2012
()
ARB: eff. 2002-2006
() / Creates opportunities for engine/fuel management technology, but only limited opportunities for catalyst technology; CA will look at catalyst forcing stds. in 2007 / Actions
Encourage tighter standards
1. TS&I

Market Data

Est. U.S. sales in 2001
O/R motorcycles --
195,000
ATVs -- 880,000
Snowmobiles –
228,000 / 1.ATV test program (CA planning a program in 2007)
2Nonroad SI WP / Standards appear secure; prospects for tighter standards depend on CA actions / EU / 1.Coordination with AECC / 1.ATV test program
2.Nonroad SI WP
Recreational SI
Marine Engines
EPA: eff. 2007-2009;
New NPRM in 2007,
final in2008
()
ARB: eff. 2003-2009
( / Four-stroke engines are primary compliance path for toughest ARB standards (same as EPA proposal); few opportunities for catalysts; ARB considering another phase of tighter stds. for outboards; opportunities for evap. technologies / Actions
Encourage ARB and EPA to tighten existing standards
1. TS&I
Market Data
Estimated U.S. sales in 2000
Outboards – 241,000
Personal watercraft – 92,000 /

1. Outboard Marine SI test program
2. Marine SI WP

/ Standards appear secure; prospects for tighter standards likely depend on CA actions / EU / 1. Coordination with AECC / 1. Marine SI test program
2. Marine SI WP
North America / Other Countries/Regions
Regulatory Item/
Status / Impact/
Priority / Current MECA Actions / Additional Actions to Consider / Likelihood/
Threats / Other Countries/
Regions Impacted by 2005/2010 / Current MECA Actions / Additional Actions Consider
Nonroad SI Engines
<25 hp
EPA: eff. 2002-2008
New proposal: 2007
Final: 2008 ( eff. 2011)
(
ARB: eff. 2002-2008
( / ARB Phase III standards for <25 hp NHH engines will create opportunities for catalyst and fuel/engine management technologies and evaporative controls.
EPA & ARB standards for HH engines creates a market opportunity for catalyst and fuel/management technologies / Actions
Support ARB non-handheld engine rule; encourage EPA to harmonize
1.TS&I
2.SORE test programs

Market Data

Estimated U.S. sale in 2001
Handheld – 10 million
Non-handheld – 15 million / 1.Nonroad SI WP / Bond amendment forced EPA to develop new proposed federal standards; EPA safety study completed; EPA proposal largely harmonizes with CA on NHH for exhaust and evap. / EU / 1.Coordination with AECC
2.SORE test program / 1.Nonroad SI WP
Marine SI Sterndrive
EPA: proposal 2007;
final 2008
(
ARB: eff. 2003-2009
( / ARB stds. create opportunities for catalyst-based technologies, engine/fuel management, & OBD technologies; EPA to follow ARB lead with delayed implementation / Actions
Support EPA rulemaking
1.TS&I
2. ARB/EPA test program

Market Data

Estimated U.S. sales in 2004 –
Sterndrive & Inboard combined 140,000 engines, V6 & V8s / 1.Nonroad SI WP / Freshwater test complete; successful for TWCs; limited saltwater testing also successful; ARB opts for 100% implementation in 2008 / EU / 1.Coordination with AECC
2.ARB test program / 1.Nonroad SI WP
Recreational CI Marine
EPA: eff. 2004-2009; new proposal in 2007 with commercial marine; final likely in 2008
( / Current standards do not create opportunities for emission control technology. Next round of EPA proposals includes PM and NOx control from catalysts on only > 2000 kW engines / Actions
Support tightening existing standards
1. TS&I

Market Data

Estimated U.S. inboard boats (SI&CI) sales in 2002 – 20,800 / 1. Technology demonstrations with EPA / To be included in EPA’s larger commercial marine rulemaking process / EU / 1.Coordination with AECC
Commercial CI Marine
EPA: proposal2007; final likely in 2008
(
ARB: proposal 2006; final likely in early 2007
( / EPA will focus on new vessels; proposal creates opportunities for emission control technologies on larger engines
ARB rule will focus on existing vessels and is expected to create opportunities for PM and NOx controls / Actions
Support rulemakings
1. TS&I
Market Data
TBD / 1. Technology demonstrations with EPA / Reasonable prospects, particularly in California, for advanced technologies on some marine applications
EPA issued ANPRM in 2004 / EU and Japan / 1.Coordination with AECC and CMAJ

Locomotives

EPA: eff. 2001-2005;
new proposal in 2007; likely final in 2008
( / Existing standards do not create opportunities for emission control technology
EPA Tier 4 proposal targets use of catalysts for PM & NOx control in 2014-2017 timeframe / Support tighter standards for new locomotives and retrofit of existing locomotives
1. TS&I
2. Locomotive design study with EPA (2006-07)
Market Data
ca. 1000 new, 1600 rebuilds in U.S./yr / 1.Support locomotive demonstration test programs with EPA / Tighter standards probable
Expect strong pushback from industry for use of catalysts / EU, Japan, China, India, and Korea / 1.Coordination with AECC, ECMA, CVEC, and CMAJ
Stationary CI Engines
EPA: proposal in 2005
final in 2006;
eff. 2008-2015
()
ARB: final in 2004; amended in 2005 & 2006;eff. 2005
() / Creates opportunities for non-road Tier 4-type PM, NOx controls, crankcase emission controls,
engine/fuel controls, OBD technologies on diesel/alt. fuel stationary engines; ARB regs. on new engines requires DPFs on primary engines & some back-up engines / Actions
Support the rulemaking
1.TS&I
2.Nonroad CI White Paper (WP)
3. EPA/MECA DOC test program

Market Data

EPA estimates ca. 81,500 new engines/yr. sold in the U.S. / 1. Small Engine
Adv. PM/NOx will be subject of 2007 non-road technology review – need inputs on technology options for small engines
2. Non-road diesel technology demonstrations / Final rule follows non-road Tier 4 regs.; legislative/
industry interference is likely; on-road experience will impact rule; non-road technology review targeted for 2007 / EU, Mexico, Brazil, Argentina, Chile, China, India, Taiwan, Thailand, Australia, Korea, and Japan / 1.Coordination with AECC, CVEC, ECMA, and AFEEVAS
2.Clean Fuels and Vehicles Partnership (CFVP)
3.AVECC 2006
4.Nonroad CI WP

Stationary SI Engines

EPA: proposal in 2006; final in 2007;
eff. 2007-2011
() / For stationary SI engines 25 hp, creates opportunities for technologies that are the basis for the nonroad SI engine Phase 2 standards (i.e., automotive-style overhead valve technology). For stationary SI engines >25 hp and rich-burn LPG engines >25hp, creates opportunities for technologies that will be used by Tier 2 nonroad SI engines >25 hp(i.e., three-way catalyst systems with electronic, closed-loop fuel systems). Per air toxics proposal, no controls required for existing lean-burn or rich-burn engines. / Actions
1. MECA testimony on proposed rules sent to EPA in October 2006.
2. Show OCs well-established for both HC and air toxics control.
3. Show SCR is cost-effective for NOx control.
Market Data
EPA estimates that there are 205,946 stationary SI engines(25 hp - >750 hp) in the U.S. (2002). / 1. Continue to use success of technology for nonroad SI engines as experience base for stationary SI control. / Since the proposed rule, for the most part,harmonizes with existing nonroad SI regulations and does not impose the use of add-on controls for existing engines, EPA does not expect much resistance from stationary engine operators/end-users. States will most likely push for more stringent requirements. / 1.Coordination with AECC, CVEC, ECMA, and AFEEVAS

Diesel Retrofit

EPA: in effect
(
ARB (fleet rules): continuing with on-road, off-road proposals in 2007
(
NYC adopted retrofit rules in 2003 & 2005
)
NJ adopted retrofit rules in 2005; NY state in 2006
CMAQ funds now available for retrofits on construction equipment due to 2005 federal highway legislation
( / EPA (voluntary) and ARB (mandatory) programs create opportunities for PM and NOx control technologies; other mandatory programs likely in non-attainment regions (e.g., Texas, Northeast); NYC mandatory retrofits include construction equip., all diesel vehicles, refuse haulers, school buses, & sight-seeing buses; NJ retrofit program focused on public vehicles; NY state retrofit program focused on public vehicles / Actions
Support programs & promote projects
1.TS&I
2.IDRAC Comm.
3.Retrofit website
4. Retrofit WP
5. EPA & collaborative workgroups

Market Data

11-12 million in-use diesel engines nationwide (ca. 1.2 million in CA) / 1. Support CMAQ off-road retrofit efforts
2. Support retrofit funding initiatives
3. Support regional retrofit events
4. MECA regional retrofit event / Growing interest in retrofit programs – issue will be funding; warranty, NO2 emissions are issues in Calif.; EPA holds conferences in DC on June 2004 & Dec. 2005 to expand program interest beyond school buses (e.g., freight, ports, construction); Regional collaboratives established (e.g., West Coast, Northeast, Mid-Atlantic) to promote public/private retrofit programs / European Union (EU), Mexico (EPA transit project in Mexico City), Brazil, Argentina, Chile, China (EPA transit project in Beijing), India, Korea, Thailand (World Bank, US AID project in Bangkok), Taiwan, Australia, South Korea, and Japan / 1.Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ
2.Clean Fuels and Vehicles Partnership (CFVP)
3.AVECC 2006
North America / Other Countries/Regions
Regulatory Item/
Status / Impact/
Priority / Current MECA Actions / Additional Actions to Consider / Likelihood/
Threats / Other Countries/
Regions Impacted by 2005/2010 / Current MECA Actions / Additional Actions to Consider
Fuels

Gasoline Sulfur

EPA: eff. 2004-2007
(
ARB: eff . 2004
( / EPA and ARB rules will enable the use of advanced emission control technology
ARB considering Phase III reform. gas with 20 ppm S cap / Support rules
1.TS&I / Appears secure / European Union (EU), Mexico, Brazil, Argentina, Chile, China, India, Korea, Thailand, Taiwan, Australia and Japan / 1.Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ
2.Clean Fuels and Vehicles Partnership (CFVP)
3.AVECC 2003
Diesel Sulfur On-Road (<15 ppm)
EPA: eff. 2006-2009
(
ARB: eff. 2006
( / EPA and ARB rules will enable the use of advanced emission control technology / Support the rule
1.TS&I / 15 ppm level appears secure; EPA added 45 day extension to retail deadline (10/15/06)
Pipeline system contamination an issue / European Union (EU), Mexico, Brazil, Argentina, Chile, China, India, Korea, Thailand, Taiwan, Australia and Japan / 1.Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ
2.Clean Fuels and Vehicles Partnership (CFVP)
3.AVECC 2006
Diesel Sulfur Off-Road (<15 ppm)
EPA: eff. 2010; 2012 for marine & locomotive
(
ARB: eff. 2006; 2007 for marine and locomotive
( / EPA and ARB rules will enable the use of advanced emission control technology / Support the ARB and the EPA rule
1.TS&I
2.Nonroad CI WP / Oil industry appears ready to accept 15 ppm limit, but may fight EPA on timing / European Union (EU), Mexico, Brazil, Argentina, Chile, China, India, Korea, Thailand, Taiwan, Australia and Japan / 1.Coordination with AECC, CVEC, ECMA, AFEEVAS, and CMAJ
2.Clean Fuels and Vehicles Partnership (CFVP)
3.AVECC 2006
Miscellaneous
Mobile Source Toxics

EPA: study 2004-05; proposal in 2006; final in 2007

.( / Current EPA MSAT rule focuseson 3 areas: fuel (national benzene limits), gaoline fuel cans (likely to adopt CA stds.), and cold ambient HC limits for light-duty vehicles (likely met thru engine calibration) / Support mobile source toxic controls
1.TS&I / EPA focus is away from setting mobile toxics standards since Tier 2 and the HDE standards for HC and PM will result in significant reductions in toxic emissions as well. / EU and Japan / 1.Coordination with AECC and CMAJ

Key to Acronyms and Abbreviations

1

MECA Market Growth Road Map

June 2007

A

AECC – Association for Emissions Control by Catalyst

Adv. – advanced technology

AFEEVAS – Associacao Dos Fabricantes de Equipmentos Para Controle de

Emissoes Veiculares da America do Sul

AFNCCAC – Asociacion de Nacionales de Converters Cataliticos, AC

A/M – aftermarket converter

A/M Conv. – aftermarket converter

APBF-DEC – Advanced Petroleum-Based Fuels – Diesel Emission Control test