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To: Alex Paquot, Nikolaus Steininger, DG CLIMA, European Commission.

From: Felipe Rodríguez, Rachel Muncrief, Oscar Delgado, The ICCT
Date: January 19, 2018

Comments regarding the cost-effective technology potential of tractor-trailers in

the EU, in the context of the upcoming HDV CO2 standards

Purpose: The technologies required to achieve a 43% fuel consumption reduction of

EU tractor-trailers are cost-effective and result in net economic benefits for the first
owner. In this memo, we aim to provide the key quantitative evidence supporting this
finding.

1. Cost-effective technology potential of tractor-trailers in the EU

Over the past several months, the ICCT has conducted a careful analysis of the set of
current and future technologies that will enable significant CO2 reductions in the
European heavy-duty vehicle (HDV) sector in the 2020-2030 timeframe. Tractor-trailers
operating in long-haul are responsible for over 70% of the on-road CO2 emissions of
HDVs over 7.5 tonnes. Therefore, this memo focuses on that vehicle segment. 1

Baseline specifications Tractor-trailer 60

Long Haul
Gross vehicle weight (t) 40
Tractor-trailer fuel consumption (L/100km)

Vehicle curb weight (t) 14.4 50

Axle configuration 4×2

Aerodynamic drag area (m2) 6.0

40
Tire rolling resistance (N/kN) 5.5
Engine emissions
Engine displacement (L)
Euro VI
12.8
Vehicle 30

Engine power (kW) 350 Simulation

Engine peak BTE (%) 44.8 20
Transmission type AMT
Transmission gear number 12
10
Transmission gear ratios 14.93–1.0
Rear axle ratio 2.64
Accessory power (kW) 5.6 0
empty 19.3 t full

Exhibit A. EU tractor-trailer baseline specification and fuel consumption over the Long
Haul cycle for the year 2015

1
Oscar Delgado, Felipe Rodríguez, and Rachel Muncrief, “Fuel Efficiency Technology in European
Heavy-Duty Vehicles: Baseline and Potential for the 2020–2030 Time Frame” (International Council on
Clean Transportation, July 17, 2017), http://www.theicct.org/EU-HDV-fuel-efficiency-tech-2020-2030.
ICCT assessed the technology potential of EU tractor-trailers, in comparison to a 2015
baseline. The baseline was defined through market data, literature review, consultation
with experts, and purchase of component data from engineering service providers.
Using vehicle simulation, we estimated the fuel consumption of the 2015 baseline
vehicle to be 33.1 L/100 km over the Long Haul cycle at 19.3 tonnes of payload (see
Exhibit A).

To estimate the fuel consumption reduction potential of future tractor-trailers in the year
2030, we examined a large number of technologies (see Exhibit B), and their individual
baseline market penetration and fuel consumption reduction.2 Engine efficiency,
aerodynamic drag, tire rolling resistance, and powertrain hybridization are the
technology areas with the highest potential for fuel consumption improvement.

Exhibit B. Technologies considered for determining the 2030 technology potential of EU

tractor-trailers
The individual technologies were combined in 12 incremental technology packages (see
Exhibit C). The fuel consumption reduction potential of each one of these packages was
quantified using vehicle simulation, to capture possible interactions between the
technologies. The most advanced technology package, with a 43% fuel consumption
reduction with respect to the 2015 baseline, includes the following features:
• Engine with a peak thermal efficiency of 55%
• Overall aerodynamic drag coefficient of 0.35
• Overall tire rolling resistance of 4 kg/tonne
• Lightweighting of 2300 kg
• Parallel hybrid powertrain

2
Felipe Rodríguez et al., “Market Penetration of Fuel Efficiency Technologies for Heavy-Duty Vehicles in
the EU, US and China” (International Council on Clean Transportation, May 2017),
http://www.theicct.org/market-penetration-HDV-fuel-efficiency-technologies.
 Fuel consumption (L/100km)
35 30 25 20 15 10 5 0

Reference
Reference 2015 tractor-trailer
(44.8% peak brake thermal efficiency)

7% Reduction
Reduce road load (16.7% aerodynamics,
9.1% rolling resistance, 1.4% weight)

10%
Add 2017 best-in-class engine
(46.0% peak brake thermal efficiency)

11% Increase driveline efficiency (+2%)

17%
Reduce road load (23.3% aerodynamics,
18.2% rolling resistance, 2.8% weight)

Incremental steps
23%
Add 2020+ engine
(48.6% peak brake thermal efficiency)

26%
Reduce road load (26.7% aerodynamics,
21.8% rolling resistance, 6.9% weight)

27% Downsize engine 10% and downspeed

29%
Add Waste Heat Recovery
(51.2% peak brake thermal efficiency)

35%
Reduce road load (41.7% aerodynamics,
27.3% rolling resistance, 16.0% weight)

39%
Add 2030-Add 2030-era engine
(55.0% peak brake thermal efficiency)

43%
Add hybrid technology
(Regenerative braking)
3.0 2.5 2.0 1.5 1.0 0.5 0.0
Payback period (years)
Payback (bottom axis) Fuel Consumption (top axis)

Exhibit C. The technology package with a 43% fuel consumption reduction has a
payback time of approximately 2 years. The packages shown are incremental, that is a
given technology step includes the steps above.
The technology level required to achieve a 43% fuel consumption reduction in the year
2030, although ambitious, is technically feasible. For example:
• The U.S. Department of Energy, under its SuperTruck II program, has funded
industry teams–including Cummins, Daimler, Navistar (VW), Volvo and Paccar
(DAF)–to achieve a 55% peak engine efficiency. A 51% efficiency was already
demonstrated under the SuperTruck I program, and the some of the program
participants have already outlined their approaches to achieve 55% peak
efficiency.3
• Tesla has showcased its Tesla Semi with an air drag coefficient of 0.36.4 MAN
has also showcased its Concept S prototype with an air drag coefficient of 0.3.5

3
Neerav Abani et al., “Developing a 55% BTE Commercial Heavy-Duty Opposed-Piston Engine without a
Waste Heat Recovery System,” in SAE Technical Paper, 2017, https://doi.org/10.4271/2017-01-0638;
Steven Ashley, “Cummins Aims to Boost Heavy-Duty Diesel Efficiency to 55%,” SAE Truck and Off-
Highway Engineering, 2015, http://articles.sae.org/14388/; Jacqueline O’Connor et al., “Optimization of an
Advanced Combustion Strategy Towards 55% BTE for the Volvo SuperTruck Program,” SAE International
Journal of Engines 10, no. 3 (2017), https://doi.org/10.4271/2017-01-0723.
4
https://www.tesla.com/semi
5
https://www.mantruckandbus.com/de/presse/presseuebersicht/MAN-praesentiert-aerodynamisch-
optimierten-Sattelzug-der-Zukunft-20800.html
 • A rolling resistance of 4 kg/tonne corresponds to tires with an efficiency label A.
These tires are already available on the market, and are expected to gain further
market penetration in the coming years.6
• Bosch has demonstrated a mild parallel hybrid system that can save up to 6%
fuel consumption in long-haul applications.7 ICCT’s hybrid system is modeled
after it.

To assess the cost-effectiveness of the proposed technology packages, ICCT

conducted a thorough economic analysis.8 The key economic outputs of the analysis
are the technology cost curves, payback periods, and net user economic benefits. To
capture a range of possible economic scenarios, the study uses three discount rates –
4%, 7%, and 10%, three diesel fuel prices per liter – €0.70, €1.10, and €1.40, and two
evaluation years – 2025, and 2030. The economic assessment reflects 2016 euros and
excludes value-added tax (VAT).
€180,000
€2,324
Tractor trailer price (2016€, excluding VAT)

€8,535
€7,106 20%
€160,000 €3,606
€5,726 €397 €124 €210 €1,296 €1,601 10%

Change from Reference Price

€140,000 0%

€120,000

€100,000

€80,000

€60,000

€40,000
Driveline Low Aerodynamic Lightweighted Maintenance
efficiency rolling trailer trailer (Net
€20,000 resistance (x1.4) (x1.4) Present
trailer Value)
(x1.4)
€0
Reference Engine Low Aerodynamic Lightweighted Hybrid New
tractor efficiency rolling tractor tractor system (2030)
trailer resistance tractor
tractor trailer

Exhibit D. Cost breakdown of the most advanced technology package in 2030. The
technologies required to achieve a 43% fuel consumption reduction in 2030 will cost
around €30,900

6
ETRMA, “Low-Emission Mobility. Focus on Freight Transport” (European Tyre & Rubber Manufacturers’
Association, 2016).
7
Bosch, “Hybrid System for Heavy Commercial Vehicles” (Robert Bosch GmbH, 2014),
http://products.bosch-mobility-
solutions.com/media/ubk_europe/db_application/downloads/pdf/antrieb/en_3/DS-Sheet_P119J_CV-
Hybrid_EN_low.pdf.
8
Dan Meszler et al., “European Heavy‑Duty Vehicles – Cost Effectiveness of Fuel Efficiency
Technologies for Long‑haul Tractor‑trailers in the 2025‑2030 Timeframe” (International Council on Clean
Transportation, January 2018), http://theicct.org/publications/cost-effectiveness-of-fuel-efficiency-tech-
tractor-trailers.
The most advanced technology package, offering a 43% fuel consumption reduction,
is estimated to cost €30,900 in 2030 (see Exhibit D), resulting in net lifetime savings
(fuel savings minus technology cost) of €84,000 per tractor‑trailer under average
economic assumptions (€1.1/liter of diesel, 7% discount rate), and up to €136,000 in
the best-case scenario (€1.4/liter of diesel, 4% discount rate, see Exhibit E). The
package has a payback period of 1.7 years under average economic assumptions,
and up to 2.7 years in the worst-case scenario (€0.7/liter of diesel, 10% discount rate,
see Exhibit C).

The attractive payback periods of tractor-trailer efficiency technologies persist even

under the most unfavorable economic conditions analyzed (i.e., higher technology
costs, low fuel prices, and high discount rates). The attractive and robust payback-
period findings indicate that there are prevailing market barriers to technology
introduction, warranting the introduction of stringent tractor-trailer efficiency standards.

€ 160,000
2025 Evaluation Year, 10% Discount, €0.7 Fuel Price
€ 140,000 2030 Evaluation Year, 4% Discount, €1.4 Fuel Price
Net Lifetime Savings (2016€)

€ 120,000

€ 100,000

€ 80,000

€ 60,000

€ 40,000

€ 20,000

€0
34 32 30 28 26 24 22 20 18
Onroad Fuel Consumption (L/100km)

Exhibit E. Net lifetime saving of HDV technology packages. Despite higher capital
investment, the 43% technology package offers a net economic benefit between €31k
and €136k

While upfront technology costs can be significant, the economic return and short
payback times more than justifies an investment in efficiency, even for the first owner.
For typical first owners of a tractor, available efficiency technologies offering a 43%
reduction in fuel consumption for new 2030 tractor-trailers, would result in €73,000 in
fuel savings (2.5 times the initial capital investment) under average economic
assumptions, and up to €98,000 (3.3 times the initial capital investment) in the best-
case scenario.
2. Policy implications

Several regions around the world have already introduced efficiency standards for
HDVs. Exhibit F9 shows the relative stringency of the different tractor-truck efficiency
standards with respect to the baseline defined when the standards were first introduced.
CO2 reductions required by mandatory standards

0%
compared to baseline year (tractor trucks)

India
Japan
-10%
China

-20%

-30%

-40% U.S. and Canada (Tractor)

-50%
U.S. and Canada (Tractor + Trailer)

-60%
2000 2005 2010 2015 2020 2025 2030 2035
Exhibit F. Tractor-truck standards around the world. The EU will be the last major
economy to introduce HDV efficiency standards
The greenhouse gas standards for tractor-trucks in the United States and Canada are
currently in their second phase. Combined, the U.S. Phase 1 and Phase 2 standards
require a GHG reduction of approximately 44% with respect to the initial 2010 baseline
defined for the Phase 1 standard. The HDV GHG Phase 2 standards were introduced in
2016, and set limit values for the years 2021, 2024, and 2027.

In China, the combined effect of the Stage 1, Stage 2 and Stage 3 standards is a 27%
fuel consumption reduction of tractor-trucks with respect to the 2015 baseline. The
proposed Stage 3 standards will go into effect in 2019, for new type approvals, and on
2021 for all new heavy commercial vehicles sold in China.

In 2005, Japan was the first market to introduce fuel efficiency standards for heavy-duty
vehicles. The 2015 targets reflect a 10.8% reduction in fuel consumption compared to a
2002 baseline. In December of 2017, Japan released the proposal for the second phase
of its 2025 fuel efficiency standards, strengthening the 2015 truck standard by 13.4%.
The combined effect of the 2015 and 2025 standards are a 22% reduction of fuel
consumption with respect to the 2002 baseline.

9
The figure attempts to show the efficiency targets around the world in a single diagram, by relating the
reduction requirements to a fixed baseline. Note, however, that the baselines, testing methodologies, and
evaluated metrics vary around the world. The figure is presented for illustrative purposes, and does not
capture all the underlying details that are common or different across the different regions.
India introduced the first phase of its HDV fuel efficiency standards in 2017. The
incipient program sets limits for 2018 (baseline) and for 2021, for an overall stringency
of approximately 6% with respect to the baseline.

HDV efficiency standards are the single largest regulatory lever that policy makers can
adopt to mitigate the CO2 emission from the on-road freight sector. The EU has set a
target of the non-ETS emissions by 30% in the 2005 to 2030 period. To achieve this
goal the Commission should introduce stringent long-term standards, that guarantee the
necessary lead time required for new technology introduction, while ensuring at the
same time the required CO2 reductions.

A well-designed technology forcing standard can be beneficial for all stake holders,
ensuring CO2 reductions, while at the same time reducing the total cost of ownership for
transport operators, and maintaining the international competitiveness of the European
HDV industry. As other regions in the world continue to introduce new, or adjust existing
efficiency standards, EU manufacturers will face increasingly competitive pressures.
CO2 reduction potential

43%
35%

24%

12%

0%
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br ith

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e ly

Tr
in tor
in on
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. e cto

. e Tr
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%

%
55

55

Exhibit G. The 2030 fuel consumption reduction potential of tractor-trucks, without

including trailer technologies, is 35%
ICCT estimates show that by the year 2030, tractor-trucks can become 35% more
efficient than their 2015 counterparts, even without the aid of trailer improvements (see
Exhibit G). This finding is of particular relevance to inform the possible stringency of
future whole vehicle standards that do not include trailer technologies. This level of
efficiency improvement is dependent on the successful development and deployment of
two key powertrain technologies: 55% peak efficiency engines, and hybrid powertrains.
These two technologies might require a longer lead time for market introduction.

To inform the fuel consumption reduction potential of long-haul tractors (i.e., without
consideration of trailers) in the near term, ICCT simulated the fuel consumption of the
advanced tractor in the absence of 55% peak efficiency engines and hybrid powertrains.
Results indicate a tractor fuel consumption reduction potential of 24% (see Exhibit G).
The stringency of the upcoming HDV CO2 standards for the EU ideally would be high
enough so that it cannot be met using currently marketed technology, effectively forcing
new technology into the market. This will help EU manufacturers to stay at the forefront
of technologies and remain competitive in international markets. Given the possible
implementation years currently being considered by the Commission, our analysis
suggests that fuel consumption reductions of 24% and 35% are achievable for long-haul
tractor trucks by the years 2025 and 2030, with respect to ICCT’s 2015 baseline.

The phase-in timing for any efficiency regulation will play a large part in determining the
benefits in a given year. The EU has set binding CO2 reduction targets for 2030, so
ideally any standard would start impacting new vehicles prior to this date, to achieve
measurable benefits by 2030. Exhibit H shows the results of an analysis10 that looks at
the benefits in 2030 compared with a business-as-usual case of an HDV standard
started in either 2020 or 2025, with either 1%, 2%, 3%, or 4% annual improvement. If a
standard was put in place that started mandating annual average reductions of 2% per
year from the new vehicle fleet starting in 2020, the overall fleetwide benefits in the year
2030 would be close to 10% below the business as usual case. However, if the same
standard was put in place but did not begin until 2025, the overall benefits in 2030
would be 3% below the business-as-usual case. Therefore, timing as well as stringency
would ideally be considered to maximize the benefits by 2030.

18
Start year: 2020 2025
2030 fleet-wide HDV CO2 reduction from

16

14
business as usual (%)

12

10

0
1 2 3 4 1 2 3 4
Annual improvement rate of potential HDV EU standard (%)
Exhibit H. A delayed introduction of a stringent standard has lower benefits than the
early introduction of a less stringent standard

10
Muncrief, R. (2016, May 31). Europe should set binding CO2 reduction targets for trucks. Retrieved
from https://www.theicct.org/blogs/staff/europe-should-set-binding-co2-reduction-targets-trucks
In general, ICCT supports the early introduction of long-term technology forcing
standards that guarantee the CO2 emissions reductions needed to meet EU’s targets for
2030, while providing enough lead-time for industry to develop and market the required
technologies. The CO2 benefits of the upcoming efficiency standards would be
maximized by the simultaneous introduction of whole vehicle standards and of
complementary standards for trailers (additional 12% CO2 reduction potential, see
Exhibit G) and by the implementation of engine CO2 standards that guarantee
investments on engine efficiency technologies and could cover the remaining
unregulated HDV segments.11

3. List of supporting ICCT publications

Cost-effective technology potential

• European Heavy‑Duty Vehicles – Cost effectiveness of fuel efficiency technologies

for long‑haul tractor‑trailers in the 2025‑2030 timeframe.
http://theicct.org/publications/cost-effectiveness-of-fuel-efficiency-tech-tractor-trailers
• Fuel Efficiency Technology in European Heavy-Duty Vehicles: Baseline and
Potential for the 2020–2030 Time Frame. http://www.theicct.org/EU-HDV-fuel-
efficiency-tech-2020-2030
• Heavy-duty vehicles technology potential and cost study.
https://www.theicct.org/publications/heavy-duty-vehicles-technology-potential-and-
cost-study
• Transitioning to zero-emission heavy-duty freight vehicles.
https://www.theicct.org/publications/transitioning-zero-emission-heavy-duty-freight-
vehicles

Market analysis

• Market Penetration of Fuel Efficiency Technologies for Heavy-Duty Vehicles in the

EU, US and China.http://www.theicct.org/market-penetration-HDV-fuel-efficiency-
technologies
• Overview of the heavy-duty vehicle market and CO2 emissions in the European
Union. https://www.theicct.org/publications/overview-heavy-duty-vehicle-market-
and-co2-emissions-european-union

11
Rachel Muncrief and Felipe Rodríguez, “A Roadmap for Heavy-Duty Engine CO2 Standards within the
European Union Framework” (The International Council on Clean Transportation, September 4, 2017),
http://www.theicct.org/publications/roadmap-heavy-duty-engine-co2-standards-within-european-union-
framework.
• Literature review: Real-world fuel consumption of heavy-duty vehicles in the United
States, China, and the European Union.
https://www.theicct.org/publications/literature-review-real-world-fuel-consumption-
heavy-duty-vehicles-united-states-china
• Barriers to the adoption of fuel-saving technologies in the trucking sector.
https://www.theicct.org/publications/barriers-adoption-fuel-saving-technologies-
trucking-sector
• Shell game? Debating real-world fuel consumption trends for heavy-duty vehicles in
Europe. https://www.theicct.org/blogs/staff/debating-EU-HDV-real-world-fuel-
consumption-trends

Policy recommendations

• A roadmap for heavy-duty engine CO2 standards within the European Union
framework.http://www.theicct.org/publications/roadmap-heavy-duty-engine-co2-
standards-within-european-union-framework
• Europe should set binding CO2 reduction targets for trucks.
https://www.theicct.org/blogs/staff/europe-should-set-binding-co2-reduction-targets-
trucks
• The European Union’s leadership void on heavy-duty vehicle GHG standards.
https://www.theicct.org/blogs/staff/EU-leadership-void-HDV-GHG-standards
• Europe’s global leadership on vehicle emission standards at risk in the truck sector.
https://www.theicct.org/blogs/staff/europes-global-leadership-vehicle-emission-
standards-at-risk-truck-sector
• Reducing CO2 emissions from road transport in the European Union: An evaluation
of policy options. https://www.theicct.org/publications/reducing-co2-emissions-road-
transport-european-union-evaluation-policy-options