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DEPARTMENT OF THE ENVIRONMENTFederal Agenda on Cleaner Vehicles, Engines and Fuels Notice is hereby given that the Minister of the Environment has developed a federal agenda on cleaner vehicles, engines and fuels, as annexed. DAVID ANDERSON Minister of the Environment ANNEX Federal Agenda on Cleaner Vehicles, Engines and Fuels Environment Canada intends to develop and implement a series of measures over the next decade to further protect the health of Canadians and the environment by reducing emissions from vehicles, engines and fuels. Background Air pollution is a serious health problem. Across Canada, studies show that there are more than 5 000 premature deaths a year that can be attributed to air pollution. Air pollution is also associated with other health impacts, including cardio-vascular ailments and respiratory distress and results in increased emergency hospital visits and hospital admissions for Canadians. Clearly, there is a need to continue taking strong actions to provide a healthier environment for Canadians. The use of internal combustion engines to power vehicles and equipment and the combustion of fuel oils contribute significantly to air pollution in Canada, particularly in urban areas. Emissions of concern include nitrogen oxides (NOx), volatile organic compounds (VOCs), sulphur oxides (SOx), carbon monoxide (CO), greenhouse gases, fine particulate matter, benzene, 1,3-butadiene, formaldehyde, acetaldehyde and other toxic or potentially toxic substances. These emissions are primarily a function of vehicle/engine technology and the properties of the fuels. Since the performance of vehicle/engine emission control systems can be impaired without the right fuels, the development of effective policies and programs to reduce emissions must consider fuel standards and vehicle/engine emission standards as an integrated system. In the spring of 2000, the federal Minister of the Environment announced the federal government's integrated clean air strategy. In recognition of the above, a key component of the clean air strategy is the development and subsequent implementation of a federal agenda on cleaner vehicles, engines and fuels for the next decade. As an initial step, on April 4, 2000, the Deputy Minister of the Environment wrote to a wide range of stakeholders, inviting them to participate in the development of the agenda on cleaner vehicles, engines and fuels. Environment Canada also prepared a discussion paper entitled "Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum-based Fuels" and distributed this document to all parties who expressed an interest in participating in the process of developing the federal agenda, in response to the Deputy Minister's invitation. The purpose of the discussion paper was to set out the background on various issues and initiate dialogue on what the next decade might hold in regards to new standards in these areas. On May 25 and 26, 2000, Environment Canada convened a multi-stakeholder workshop in Toronto to bring together leading experts on matters dealing with emissions from vehicles, engines and fuels to discuss future measures to reduce air pollution from these sources. The Vehicle and Fuels Workshop was attended by more than 125 representatives from federal departments, provincial and municipal governments, health and environmental groups, the petroleum refining industry, automotive and engine manufacturers and the alternative fuels sector. All parties were invited to either make presentations at the workshop and/or to provide written submissions which detailed their views on the measures that should be included in the cleaner vehicles, engines and fuels agenda. All workshop presentations and submissions were subsequently distributed in July to stakeholders. Following a thorough review and full consideration of stakeholder comments, the Minister of the Environment has developed a federal agenda of planned measures and future initiatives to reduce pollution from vehicles, engines and fuels. The following is a summary of the main action items respecting that agenda. Summary of Planned Actions on Cleaner Vehicles, Engines and Fuels 1. Action on On-Road Vehicles and Engines Environment Canada intends to proceed with the development of regulations under Division 5 of the Canadian Environmental Protection Act, 1999 (CEPA 1999), to align Canadian emission standards for on-road vehicles and engines with those of the United States (U.S.) Environmental Protection Agency (EPA). Specifically, the following items will be included: Light-duty vehicles and light-duty trucks (cars, pickups, sport utility vehicles, etc.): - Proposed regulations will be developed to align with U.S. Tier 2 standards to be phased-in starting in the 2004 model year; - For model years 2001-2003, an interim Memorandum of Understanding with vehicle manufacturers will be developed to provide for introduction of vehicles meeting LEV (low emission vehicle) standards; and Heavy-duty vehicles and engines: - Proposed regulations will be developed to bring Phase 1 standards into effect for model year 2004 and Phase 2 standards into effect consistent with U.S. timing. In developing future emission regulations for on-road vehicles and engines under CEPA 1999, Environment Canada plans to ensure that the environmental performance of new vehicle fleets in Canada will be comparable to applicable U.S. program objectives. The details of future regulations, including possible corporate fleet-averaging standards or alternate mechanisms that achieve comparable results, will be developed in consultation with stakeholders during the regulatory development process. 2. Action on In-Use Vehicles and Engines The Department intends to develop a Code of Practice for Heavy Duty Vehicle Inspection and Maintenance Programs in consultation with interested stakeholders. 3. Action on Off-Road Vehicles and Engines The Department intends to proceed with the development of emissions control programs for off-road engines, under Division 5 of CEPA 1999, aligned with the corresponding U.S. federal emissions control programs. These include: - Development of proposed Regulations corresponding to the U.S. EPA Phase 2 program for spark-ignition gasoline utility engines; - Development of proposed Regulations corresponding to the U.S. EPA Tier 2 program for compression-ignition off-road engines; and - Development of proposed Regulations corresponding to the U.S. EPA program for spark-ignition marine engines. The Department will consider the development of: - Tier 3 program for compression-ignition off-road engines when the full scope of the U.S. EPA program is available; and - Emissions control programs for large spark-ignition engines, recreational vehicles using gasoline engines, and stern drive and inboard gasoline-powered marine engines aligned with the U.S. EPA programs once these programs are finalized in the United States. The details of future proposed Regulations, including self-certification, emissions credit systems and fleet averaging provisions, where effective and practical, will be developed through the regulatory process. 4. Action - Policy on International Alignment for Fuels with Other Jurisdictions Environment Canada plans to continue its approach of generally aligning Canadian environmental fuel requirements with those of the United States, while taking into consideration environmental standards developed by the European Union. There may be instances, however, where Canada takes additional action to protect the health of Canadians and the environment. 5. Action on Future Standards for Diesel Fuel On-Road Diesel Fuel Environment Canada intends to align with the final U.S. level and timing for sulphur in on-road diesel fuel (i.e. 15 ppm sulphur limit starting June 1, 2006). The Canadian regulatory process will be initiated shortly with a discussion paper soliciting views from stakeholders on the need for and the form of "safety valve" provisions similar to those in the U.S. final rule. Environment Canada also intends to establish a comprehensive database on diesel fuel composition in order to monitor fuel quality. Refiners and importers of diesel fuel will be requested to provide information on the levels of cetane, aromatics and PAHs in both on-road and off-road diesel starting in January 2001. If participation in this survey is inadequate, Environment Canada will consider mandatory reporting requirements. Off-Road Diesel Environment Canada plans to recommend a regulatory limit for sulphur in off-road diesel. The limit would be established in the same time frame that the EPA plans for developing limits for sulphur in U.S. off-road diesel (expected to be in 2001). In preparation for this, Environment Canada will gather information on where off-road diesel is used, the effects of sulphur reduction on emissions, and the costs of reducing sulphur in diesel for use in all off-road engines and vehicles, including rail and marine applications. The survey of diesel composition, discussed in the previous section on on-road diesel, will also include off-road diesel. 6. Action on Future Standards for Fuel Oils Environment Canada proposes to develop measures to reduce the level of sulphur in both light and heavy fuel oils used in stationary facilities. Environment Canada intends to commence studies in 2001 of the benefits to the health of Canadians and the environment as well as the cost of reducing sulphur in fuel oils, with the view to matching the requirements set by the European Union for sulphur in fuel oils which will be fully implemented by 2008. Complementary measures to Regulations, such as economic instruments, will be examined to accelerate the introduction of low-sulphur fuel oils. 7. Action on Future Standards for Gasoline There are a number of issues associated with gasoline where action is warranted. The various actions that will be undertaken are itemized separately for each issue. Gasoline Composition as it Affects Emissions of Air Toxics Further analysis is required of the potential for additional controls on gasoline quality to reduce emissions of toxic substances from vehicles. Environment Canada plans to study the effect on emissions of toxic substances from vehicles of setting additional limits for gasoline composition. Possible action to implement more stringent controls on gasoline composition in order to reduce emissions of air toxics from gasoline-powered vehicles is a lower priority than addressing the quality of diesel and fuel oils used in stationary facilities. Deposit Control Additives Environment Canada intends to examine the current usage patterns of deposit control additives in Canada and the costs of requiring their use at effective levels in all gasoline. MTBE Environment Canada intends to recommend publication in the Canada Gazette of a notice under paragraph 71(1)(b) of the Canadian Environmental Protection Act, 1999, requesting information on the usage and releases of MTBE. This notice would generally apply to those persons handling MTBE or gasoline containing MTBE. Following a review of this information, Environment Canada will consider whether further action in respect of MTBE is warranted. Ethanol The Department will continue to examine this issue in the context of its effects on emissions of greenhouse gases through participation in processes addressing climate change. Driveability Index (controls on distillation) In order to monitor Canadian gasoline quality in respect of the Driveability Index (DI), Environment Canada intends to ask refiners and importers of gasoline to voluntarily provide information on the input parameters to DI, specifically the distillation values of gasoline (T10, T50, T90) and the concentration of oxygen (by type of oxygenate) starting in July 2001. If participation in this voluntary program is poor, Environment Canada will consider mandating the reporting of the information. 8. Actions to Promote Early Introduction of Cleaner Fuels Environment Canada will explore complementary measures to Regulations, such as economic instruments and other measures, to promote the early introduction of cleaner fuels, including low sulphur fuels. Environment Canada also intends to continue to explore with other federal departments the purchase of cleaner fuels for use in government vehicles and facilities. Environment Canada will assess measures to ensure that they should have the desired impacts. Next Steps The various planned measures which constitute the federal agenda on cleaner vehicles, engines and fuels will be undertaken following established processes. For example, proposed regulations under the Canadian Environmental Protection Act, 1999, will be developed through the normal regulatory process and will provide interested parties with additional opportunities to provide input on formulating the details of future requirements. Other types of measures will be developed using mechanisms which incorporate appropriate consultations with stakeholders. Further Information A detailed supporting document entitled Support Document to the Notice of Intent on Cleaner Vehicles, Engines and Fuels, provides details on the various issues considered by Environment Canada in developing the federal cleaner vehicles, engines and fuels agenda, including the comments provided by interested parties during the consultation process, an analysis of the issues, and the Department's intended path forward. This document can be obtained on Environment Canada's Web site (www.ec.gc.ca) or by contacting Francine Lavallée by telephone at (819) 953-4807 or by facsimile at (819) 953-7815. Contacts Vehicle and Engine Issues: Mr. Ross White, Director, Transportation System Branch, Air Pollution Prevention Directorate, Environment Canada, 351 Saint-Joseph Boulevard, Hull, Quebec K1A 0H3, (819) 953-1120 (Telephone), (819) 953-7815 (Facsimile). Fuel Issues: Mr. Steve McCauley, Director, Oil, Gas and Energy Branch, Air Pollution Prevention Directorate, Environment Canada, 351 Saint-Joseph Boulevard, Hull, Quebec K1A 0H3, (819) 997-1221 (Telephone), (819) 953-8903 (Facsimile).
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