3. Methodology¶

3.1. General¶

The project folder for using this tool should contain an “inputs” folder containing necessary input files and a “tool_code” folder containing the Python modules. Optionally, a virtual environment folder may be desirable. When running this tool, the user will be asked to provide a run ID. If a run ID is entered, that run ID will be included in the run-results folder-ID for the given run. Hitting return will use the default run ID. The tool will create an “outputs” folder within the project folder into which all run results will be saved. A timestamp is included in any run-results folder-ID so that new results never overwrite prior results.

3.2. Scenario names in output files¶

Scenarios included in the primary runs are shown in Table 1.

Table 1

Scenario Name	Description
2020hold	Full fleet meeting the 2020 standards for 2020+
Safe	Full fleet meeting the SAFE FRM standards through 2026 and thereafter
2012frm	Full fleet meeting the 2012 FRM standards
0_No-action	FW-OEMs meeting the FW; NonFW-OEMs meeting SAFE
Final	FW-OEMs meeting the FW thru 2022 then the Final standards for 2023+; NonFW-OEMs meeting SAFE thru 2022 then the Final standards for 2023+
Final_No-mult	FW-OEMs meeting the FW thru 2022 then the Final standards for 2023+; NonFW-OEMs meeting SAFE thru 2022 then the Final standards for 2023+ but without advanced technology multipliers
Proposal	FW-OEMs meeting the FW thru 2022 then the Proposed standards for 2023+; NonFW-OEMs meeting SAFE thru 2022 then the Proposed standards for 2023+
Alt2-10	FW-OEMs meeting the FW thru 2022 then the NPRM’s Alternative 2 minus 10 for 2023+; NonFW-OEMs meeting SAFE thru 2022 then the NPRM’s Alternative 2 minus 10 for 2023+

3.3. Calculations and Equations¶

This is not meant to be an exhaustive list of all equations used in this tool, but rather a list of those that are considered to be of most interest. The associated Regulatory Impact Analysis (RIA) also contains explanations of some of the calculations made.

3.3.1. Off-Cycle Credit Costs, Tech Costs and Reg-Costs¶

CCEMS can calculate costs associated with off-cycle credits by entering in the scenarios input file a cost for each gram/mile of credit and by entering in the market file the number of grams/mile of credit each manufacturer is projected to earn or use. However, the version of CCEMS used by EPA does not have the ability to consider off-cycle credit use versus application of other CO2 reducing technologies. In other words, the credits are applied as stipulated in the market file and their costs are applied as stipulated in the scenarios file. Therefore, accounting for the costs of off-cycle credits in the model inputs is not necessary and can be post-processed as done by this tool. Doing so requires re-calculation of tech costs and reg-costs that are direct outputs of CCEMS.

3.3.1.1. Compliance Report¶

3.3.1.1.1. Average Off-Cycle Cost¶

(1)¶\[AvgOffCycleCost = OffCycleCredits \times CostPerOffCycleCredit\]

where,

$OffCycleCredits$ are an output of CCEMS and reflect the inputs set in the market file
$CostPerOffCycleCredit$ is set in the SetInputs class of the tool (EPA’s value is $42/gram/mile)

3.3.1.1.2. Average Reg-Cost¶

(2)¶\[ \begin{align}\begin{aligned}& AvgRegCost\\& = \small Avg AC Efficiency Cost + Avg AC Leakage Cost + Avg OffCycle Cost + Avg Tech Cost\end{aligned}\end{align} \]

where,

$Avg AC Efficiency Cost$ is the Average AC Efficiency Cost and is a direct output of CCEMS
$Avg AC Leakage Cost$ is the Average AC Leakage Cost and is a direct output of CCEMS
$Avg Tech Cost$ is the cost of technology added to achieve compliance and is a direct output of CCEMS
$Avg OffCycle Cost$ is from Equation (1)

3.3.1.1.3. Off-Cycle Cost¶

(3)¶\[OffCycleCost = Avg OffCycle Cost \times Sales\]

where,

$Sales$ is a direct output of CCEMS
$Avg OffCycle Cost$ is from Equation (1)

3.3.1.1.4. Tech Cost¶

(4)¶\[Tech Cost = Avg Tech Cost \times Sales\]

where,

$Avg Tech Cost$ is the average cost of technology added to achieve compliance and is a direct output of CCEMS
$Sales$ is a direct output of CCEMS

3.3.1.1.5. Reg-Cost¶

(5)¶\[RegCost = Avg RegCost \times Sales\]

where,

$Sales$ is a direct output of CCEMS
$Avg RegCost$ is from Equation (2)

3.3.1.2. Annual Societal Costs Summary Report¶

The annual societal costs summary report uses the RegCost from Equation (5) and reported in the Compliance Report, but reports the result as TechCost in thousands in the annual societal costs summary report.

(6)¶\[TechCost = \frac{RegCost} {1000}\]

where,

$RegCost$ is from Equation (5)

3.3.1.3. Annual Societal Costs Report¶

The annual societal costs report uses the RegCost from Equation (5) and reported in the Compliance Report, but reports the result as TechCost in thousands in the annual societal cost report and reports that result for Age = 0 (i.e., the first year of the model year since costs are taken to be accrued at initial sale).

(7)¶\[TechCost = \frac{RegCost} {1000}\]

where,

$RegCost$ is from Equation (5)

3.3.3. Discounting¶

Monetized values are discounted at the social discount rates entered in the SetInputs class. The default values are 3% and 7%. Values are discounted to the year entered in the SetInputs class. The default value is 2021. Monetized values are discounted assuming costs occur at the beginning of the year or the end of the year as entered in the SetInputs class. The default value is “end-year”, meaning that any monetized values in 2021 are discounted.

Importantly, all emission-related monetized values are discounted at their applicable discount rates, regardless of the social discount rate. The applicable discount rate is indicated in the cost-factor input files (cost_factors-criteria.csv and cost_factors-scc.csv) in the heading (e.g., values using the “co2_global_5.0_USD_per_metricton” cost factor will always be discounted at 5%, regardless of the social discount rate).

3.3.3.1. Present value¶

(24)¶\[PV=\frac{AnnualValue_{0}} {(1+rate)^{(0+offset)}}+\frac{AnnualValue_{1}} {(1+rate)^{(1+offset)}}+\cdots+\frac{AnnualValue_{n}} {(1+rate)^{(n+offset)}}\]

where,

$PV$ is the present value
$AnnualValue$ is the annual costs or annual benefit or annual net of costs and benefits
$rate$ is the discount rate
$0, 1, …, n$ is the period or years of discounting
$offset$ is the controller to set the discounting approach (0 means first costs occur at time=0; 1 means costs occur at time=1)

Note that the output files of present values are cumulative sums. Therefore, the results represent present values through the indicated year.

3.3.3.2. Annualized value¶

When the present value offset in Equation (24) equals 0:

(25)¶\[AV=PV\times\frac{rate\times(1+rate)^{n}} {(1+rate)^{(n+1)}-1}\]

When the present value offset in Equation (24) equals 1:

(26)¶\[AV=PV\times\frac{rate\times(1+rate)^{n}} {(1+rate)^{n}-1}\]

where,

$AV$ is the annualized value of costs or benefits or net of costs and benefits
$PV$ is the present value of costs or benefits or net of costs and benefits
$rate$ is the discount rate
$n$ is the number of periods over which to annualize the present value

Note that the output files of annualized values represent values annualized through the given year.

3.3.4. Vehicles Report Calculations¶

This tool makes use of the CCEMS vehicles_report.csv direct output file, and makes the calculations described here. This tool then reports the results in the vehicles_report output file included in the postproc_outputs directory in place of the vehicles_report.csv file reported by CCEMS. The CCEMS vehicles_report.csv reports technology and associated costs added to each vehicle model in each model year. It also provides information regarding the powertrain of the vehicle after adding new technology. In other words, a “conventional” powertrain vehicle, meaning a liquid-fueled internal combustion engine (ICE) vehicle with no start-stop and no electrification technologies might add hybridization technology during the course of modeling. That vehicle would be categorized as having a “conventional” powertrain at the start of modeling and, when converted to hybrid technology, would be categorized as being “SHEV” to indicate that it was now a strong hybrid electric vehicle. CCEMS includes the following powertrain categories:

Conventional, i.e., liquid-fueled and lacking any of the following powertrain technologies
SS12V, i.e., liquid-fueled and including 12 Volt start-stop technology
BISG, i.e., liquid-fueled and including mild hybrid technology
SHEV, i.e., liquid-fueled and including strong hybrid technology
PHEV, i.e., dual-fueled (liquid and electric) plug-in electric vehicle
BEV, i.e., electricity-fueled battery electric vehicle
FCV, i.e., fuel-cell vehicle

According to the CCEMS documentation (see DOT HS 812 934, March 2020), “The Vehicles Report contains disaggregate vehicle-level summary of compliance model results, providing a detailed view of the final state of each vehicle examined by the model, for each model year and scenario analyzed. The report includes basic vehicle characteristics (such as vehicle code, manufacturer, engine and transmission used, curb weight, footprint, and sales volumes), fuel economy information (before and after the analysis), initial and final technology utilization (via the reported “tech-keys”), and cost metrics associated with application of additional technology.” The documentation also notes that “Tech Costs” as reported in the vehicles_report.csv file represent “Unit costs accumulated by the vehicle model from technology application in a specific model year.”

This tool’s vehicles_report provides the following newly calculated data by “Scenario Name”, “Model Year” and “Powertrain”.

(27)¶\[SalesWtdAvgCostAdd_{Scenario;ModelYear;Powertrain} = \small\frac{(TechCost \times Sales)_{Scenario;ModelYear;Powertrain}} {Sales_{Scenario;ModelYear;Powertrain}}\]

where,

$SalesWtdAvgCostAdd_{Scenario;ModelYear;Powertrain}$ is the sales weighted average cost of technology added to vehicles in the given scenario and model year having the given powertrain
$TechCost_{Scenario;ModelYear;Powertrain}$ represents the costs accumulated by any vehicle model adding the given powertrain in the given scenario and model year and is a direct output of CCEMS
$Sales_{Scenario;ModelYear;Powertrain}$ are the final sales of vehicles adding the powertrain technology in the given scenario and model year
$Sales_{Scenario;ModelYear}$ are the final sales of vehicles in the given scenario and model year

where,

$Share_{Scenario;ModelYear;Powertrain}$ is the share of vehicles within the given scenario and model year having the given powertrain
$Sales_{Scenario;ModelYear;Powertrain}$ are the final sales of vehicles adding the powertrain technology in the given scenario and model year
$Sales_{Scenario;ModelYear}$ are the final sales of vehicles in the given scenario and model year

(29)¶\[\begin{split}& ContributionToCostPerVehicle_{Scenario;ModelYear;Powertrain} \\ & = \small SalesWtdAvgCostAdd_{Scenario;ModelYear;Powertrain} \times Share_{Scenario;ModelYear;Powertrain}\end{split}\]

where,

$ContributionToCostPerVehicle_{Scenario;ModelYear;Powertrain}$ represents the contribution of vehicles with the given powertrain to the average cost/vehicle for the given scenario and model year
$SalesWtdAvgCostAdd_{Scenario;ModelYear;Powertrain}$ is from Equation (27)
$Share_{Scenario;ModelYear;Powertrain}$ is from Equation (28)

3.3.5. Compliance Report Calculations¶

This tool makes use of the CCEMS compliance_report.csv direct output file, and makes the calculations described here.

A 2-cycle CO2 value, in grams per mile CO2, is calculated as:

(30)¶\[CO2_{2cycle} = \frac{8887} {CAFE_{2cycle}}\]

where,

$8887$ is the CO2 content of gasoline test fuel
$CAFE_{2cycle}$ is a direct output of CCEMS

And a CO2 credit use, or the banked credits used toward compliance, is calculated as:

(31)¶\[CO2_{CreditUse} = \small CO2_{2cycle} - CO2_{Rating} - AC_{Efficiency} - AC_{Leakage} - OffCycleCredits\]

where,

$CO2_{2cycle}$ is from Equation (30)
$CO2_{Rating}$ is a direct output of CCEMS and represents the achieved, or compliance CO2 value
$AC_{Efficiency}$ and $AC_{Leakage}$ are credits associated with air conditioning
$OffCycleCredits$ are the credits earned as part of the off-cycle credit program and are a direct output of CCEMS

3. Methodology¶

3.1. General¶

3.2. Scenario names in output files¶

3.3. Calculations and Equations¶

3.3.1. Off-Cycle Credit Costs, Tech Costs and Reg-Costs¶

3.3.1.1. Compliance Report¶

3.3.1.1.1. Average Off-Cycle Cost¶

3.3.1.1.2. Average Reg-Cost¶

3.3.1.1.3. Off-Cycle Cost¶

3.3.1.1.4. Tech Cost¶

3.3.1.1.5. Reg-Cost¶

3.3.1.2. Annual Societal Costs Summary Report¶

3.3.1.3. Annual Societal Costs Report¶

3.3.2. Total social costs, social benefits and net social benefits¶

3.3.2.1. New or revised parameters calculated within each scenario¶

3.3.2.1.1. FatalityCosts_Net¶

3.3.2.1.2. NonFatalCrashCosts_Net¶

3.3.2.2. New or revised parameters calculated relative to a base scenario¶

3.3.2.2.1. Total Costs¶

3.3.2.2.2. Fuel Savings¶

3.3.2.2.3. Refueling Time Savings¶

3.3.2.2.4. Energy Security Benefits¶

3.3.2.2.5. Non-Emission Benefits¶

3.3.2.2.6. Emission Benefits¶

3.3.2.2.7. Total Benefits¶

3.3.2.2.8. Net Benefits¶

3.3.3. Discounting¶

3.3.3.1. Present value¶

3.3.3.2. Annualized value¶

3.3.4. Vehicles Report Calculations¶

3.3.5. Compliance Report Calculations¶