Need For and Benefits of Tier 3 Vehicle and Fuel Standards

The Air Pollution Problem Remains Very Serious With Millions Breathing Unhealthy Air

Vehicles Remain A Major Source This is especially true with regard to NOx and VOCs the precursors of ozone.

Technology Exists To Substantially Reduce Emissions Further Potential Tier 3 Technologies are almost entirely the same as those already on California PZEV/SULEV (i.e., EPA Tier 2 bin 2) models of today increased precious metal (Pt/Pd/Rh) catalyst loading optimized close-coupled catalyst secondary air injection pump evaporative control system active HC adsorber on limited models Estimated Cost ~ $150

Low Sulfur Gasoline is Key All Existing Catalyst Equipped Vehicles Will Be Improved With Lower Sulfur Gasoline Poisoning of Precious Metal HC, CO, NOx SO2 Precious Metal Poisoning of Washcoat Lower O2 Storage Ability This shows how sulfur deteriorates the catalyst performance. Basically two paths are estimated as the reason why sulfur affects exhaust emissions. First sulfur in fuel changes to SO2 through combustion process. SO2 is adsorbed on the surface of precious metals and obstructs purification of exhaust gas. SO2 in exhaust gas is oxidized by the precious metals, ans is stored as SO4 reacting with cerium and alumina. As a result, oxygen storage ability of these materials is spoiled. Cerium SO2 SO3 O2 CeO2 ⇒ Ce（SO4)2 O2 Alumina Precious Metal Al2O3 ⇒ Al2（SO4)3

Naphtha Hydrotreating (“Post-treating”) To Reduce The Sulfur Content Fluidized Catalytically Cracked (FCC) Naphtha Is The Primary Source Of Sulfur In The Gasoline Naphtha Hydrotreating (“Post-treating”) To Reduce The Sulfur Content All existing FCC post-treaters would require revamping to meet the 10-ppm sulfur standard; The average capital expenditure for revamping is 30 percent of the expenditure for new post-treaters (even though some of the existing units may require no revamping); and The target rate of return on refinery investments is 7 percent before tax. Cost ~ $0.008/ gallon

Cost Per Ton of NOx Reduced Cost Effectiveness of Tier 3 Low-Sulfur Gasoline Relative to Other NOx Reduction Measures NOx Reduction Measure Cost Per Ton of NOx Reduced Tier 3 Low-Sulfur Gasoline $3,300 Oil/Gas Boilers Serving EGUs $1,100 - 8,700 New Small Gas Boilers $3,300 - 16,000 Municipal Waste Incinerators $2,140 (SNCR) HEDD EGUs $45,000 - $300,000 per unit Stationary Generators $39,700 - 79,700 Minor New Source Review $600 - $18,000 Source: Senate Staff Briefing on the Need for Strong NOx Caps in the Eastern U.S – OTC, ICAC, NACAA and Maryland (July 2010).