New standards to reduce sulfur levels in gasoline, which will produce significant benefits in terms of public health and local air pollution, are also part of President Obama's strategy to mitigate climate change, according to U.S. EPA Administrator Gina McCarthy.

"Tier 3 is an important part of a series of common-sense steps that the Obama administration has taken to protect public health, to address the threat of climate change through the president's action plan, and to grow the economy through the continued revitalization of the auto industry," McCarthy said on a call with reporters.

The rule, completed yesterday, will require refiners to reduce sulfur levels in gasoline by more than 60 percent, from 30 parts per million to 10 ppm by 2017. It will also curb smog-producing organic compounds and nitrogen oxide by 80 percent and particulate emissions by 70 percent.

Particulate matter contributes to climate change; it also has damaging effects on human health. According to the American Lung Association, Tier 3 will help avoid up to 2,000 premature deaths, 19,000 asthma attacks, and nearly 300,000 missed days of work and school each year by 2030.

EPA estimates that every dollar spent to meet the standard will produce $4 to $13 in health benefits. Revised estimates show the rule will cost consumers less than 0.65 cent per gallon and $72 per vehicle by the time the rule is fully implemented in 2025.

However, the rule will have immediate environmental effects, from the moment the first cars and trucks start running on cleaner fuel. Given that vehicles in the United States are 11 years old on average, lower sulfur levels are expected to reduce pollution from the current fleet by an amount equivalent to taking 33 million cars off the road.

Improving power of catalysts
Reducing sulfur levels specifically allows catalytic converters, which reduce the toxicity of pollutants in exhaust gas, to perform more effectively. Automakers are already making and selling vehicles with highly efficient catalytic converters, but their ability to reduce emissions depends on the quality of fuel.

"What [Tier 3] does is it allows the technology we're investing in here to operate at its maximum capacity and not be sort of suboptimized, if you will, with fuel that doesn't allow it to be as clean as possible," said Mike Robinson, vice president for sustainability at General Motors Co.

It's estimated that automakers will have to invest $15 billion over the next decade to meet the Tier 3 standards. Still, automakers praised the rule for linking automobiles and fuels together, and for harmonizing national standards with existing rules in California, Europe and Asia. Aligning standards will allow automakers to build, calibrate and, ultimately, sell vehicles on a widespread basis.

In addition to GM, other major manufacturers, including Kia, Toyota, Honda and Ford, have also come out in support of the rule.

"This EPA ruling will result in lower emissions and reduced greenhouse gases from all gasoline-powered vehicles in operation -- and, most importantly, cleaner air for all," said a statement by Kia Motors America. "In addition to the immediate benefits, ultra-low sulfur fuel will enable a wider range of technologies to meet environmental needs and reach higher fuel economy standards for the future."

Because sulfur makes catalytic converters work less efficiently, cleaner fuels will improve the overall efficiency of vehicles, which will help automakers meet the Obama administration's aggressive new corporate average fuel economy (CAFE) standards for light-duty vehicles.

Refineries work harder
The petroleum industry asserts, however, that the energy needed to reduce sulfur levels will ultimately lead to higher carbon dioxide emissions.

"In order to take out more sulfur from the fuel, we have to run the fuel through more processes that take more energy. In the lingo, the crude has to be refined harder. You have to do more work to get the final product that meets the specs," said Howard Feldman, director of regulatory and scientific affairs for the American Petroleum Institute. "That work takes more energy, and that energy produces CO2 when you combust that energy."

Any CO2 benefit on the vehicle side of the equation, he said, "is a separate question."

On the call with reporters, McCarthy explicitly said EPA does not foresee an increase in CO2 emissions as a result of the Tier 3 standards.

According to Jesse Prentice-Dunn, transportation policy analyst at the Sierra Club, the Tier 3 standards alone won't produce enormous CO2 benefits but will produce "enough to outweigh any increases, for sure."

"More importantly, making vehicle technology function more efficiently makes sure vehicle efficiency standards are on track," he said.

EPA and automakers are set to hold a midterm review in 2021 to evaluate whether the CAFE standards are achievable. Without Tier 3 standards in place to lower sulfur levels in gasoline, opponents of the CAFE rule could argue that implementation needs to slow down until there's gasoline available to operate new vehicle technologies, Prentice-Dunn said.

Reprinted from Climatewire with permission from Environment & Energy Publishing, LLC., 202-628-6500