§ 86.1103-2016 — Criteria for availability of nonconformance penalties.

§ 86.1103-2016 Criteria for availability of nonconformance penalties.

(a) General. This section describes the three criteria EPA will use to use to evaluate whether NCPs are appropriate under the Clean Air Act for a given pollutant and a given subclass of heavy-duty engines and heavy-duty vehicles. Together, these criteria evaluate the likelihood that a manufacturer will be technologically unable to meet a standard on time. Note that since the first two of these criteria are intended to address the question of whether a given standard creates the possibility for this to occur, they are evaluated before the third criterion that addresses the likelihood that the possibility will actually happen.

(b) Criteria. We will establish NCPs for a given pollutant and subclass when we find that each of the following criteria is met:

(1) There is a new or revised emission standard is more stringent than the previous standard for the pollutant, or an existing standard for that pollutant has become more difficult to achieve because of a new or revised standard. When evaluating this criterion, EPA will consider a new or revised standard to be “new” or “revised” until the point at which all manufacturers already producing U.S.-directed engines or vehicles within the subclass have achieved full compliance with the standard. For purposes of this criterion, EPA will generally not consider compliance using banked emission credits to be “full compliance”.

(2) Substantial work is required to meet the standard for which the NCP is offered, as evaluated from the point at which the standard was adopted or revised (or the point at which the standard became more difficult meet because another standard was adopted or revised). Substantial work, as used in this paragraph (b)(2), means the application of technology not previously used in an engine or vehicle class or subclass, or the significant modification of existing technology or design parameters, needed to bring the vehicle or engine into compliance with either the more stringent new or revised standard or an existing standard which becomes more difficult to achieve because of a new or revised standard. Note that where this criterion is evaluated after any of the work has been completed, the criterion would be interpreted as whether or not substantial work was required to meet the standard.

(3) There is or is likely to be a technological laggard for the subclass. Note that a technological laggard is a manufacturer that is unable to meet the standard for one or more products within the subclass for technological reasons.

(c) Evaluation. (1) We will generally evaluate these criteria in sequence. Where we find that the first criterion has not been met, we will not consider the other two criteria. Where we find that the first criterion has been met but not the second, we will not consider the third criterion. We may announce our findings separately or simultaneously.

(2) We may consider any available information in making our findings.

(3) Where we are uncertain whether the first and/or second criteria have been met, we may presume that they have been met and make our decision based solely on whether or not the third criterion has been met.

(4) Where we find that a manufacturer will fail to meet a standard but are uncertain whether the failure is a technological failure, we may presume that the manufacturer is a technological laggard.

[81 FR 73980, Oct. 25, 2016]