ENERGY, ECONOMICAL, AND ENVIRONMENTAL IMPACT OF IMPLEMENTING FUEL ECONOMY LABEL FOR CARS IN MALAYSIA

8/14/2019 ENERGY, ECONOMICAL, AND ENVIRONMENTAL IMPACT OF IMPLEMENTING FUEL ECONOMY LABEL FOR CARS IN MALAYSIA

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Contents

List of Tables...2

List of Figures.3

Nomenclature..4

Summary.5

1. Introduction.6

2. Survey Data.7

3. Methodology...8

3.1. Fuel saving (FS)... 8

3.2. Bill saving (BS)... 8

3.3. Capital recovery factor...8

3.4. Net saving..8

3.5. Cumulative present value (PV)..9

3.6. Emission reduction... 9

4. Results and Discussions....106. Conclusions...12

References.13

Appendix...13


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List of tables:

Table 1: Year and number of cars ..7

Table 2: Emission based on fuel type..7

Table3: Aspects of car usage and the values...7

Table 4: Number of cars and economical analysis....10

Table 5: Percentage of power generation and emission reduction....11


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List of Figures:

Fig 1: Economical profit...11

Fig 2: Emission reduction.....12

Fig 3: Number of cars prediction......14


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Summary

The Environmental Protection Agency (EPA) is finalizing changes to the

methods used to calculate the fuel economy estimates that are posted on window stickers

of all new cars and light trucks sold in the United States. This final rule will greatly

improve the EPA fuel economy estimates to more accurately inform consumers about the

fuel economy they can expect to achieve in the real world. The new test methods take

into account several important factors that affect fuel economy in the real world, but are

missing from the existing fuel economy tests. Key among these factors are high speeds,

aggressive accelerations and decelerations, the use of air conditioning, and operation in

cold temperatures. Under the new methods, the city miles per gallon (mpg) estimates for

the manufacturers of most vehicles will drop by about 12 percent on average relative to

today's estimates, and city mpg estimates for some vehicles will drop by as much as 30

percent. The highway mpg estimates for most vehicles will drop on average by about 8

percent, with some estimates dropping by as much as 25 percent relative to today's

estimates. These changes will take effect starting with 2008 model year vehicles,

available at dealers in 2007. We also are adopting a new fuel economy label design with

a new look and updated information that should be more useful to prospective car buyers.

The new label features more prominent fuel cost information, an easy-to-use graphic forcomparing the fuel economy of different vehicles, clearer text, and a Web site address for

more information. Manufacturers will be phasing in the new design during the 2009

model year. Finally, for the first time we are requiring fuel economy labeling of certain

passenger vehicles between 8,500 and 10,000 lbs gross vehicle weight rating. Because of

the Department of Transportation's recent regulation that brings medium-duty passenger

vehicles into the Corporate Average Fuel Economy program starting in 2017, EPA is now

statutorily obligated to include these vehicles in the fuel economy labeling program.

Medium-duty passenger vehicles are a subset of vehicles between 8,500 and 10,000 lbs

gross vehicle weight that includes large sport utility vehicles and vans, but not pickup

trucks. Vehicle manufacturers are required to post fuel economy labels on medium-duty

passenger vehicles beginning with the 2011 model year. Fuel economy label in Malaysia

is developed to encourage the people to choose the most efficient car, and finally to

dispose the inefficient car out of the market. In energy and environmental point of view,

this method will decrease the usage of energy and off course decrease the rate of


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pollution caused by the car emission. In economical point of view, this will surely

increase the bill savings and annual savings for the customer.

1. Introduction

This final rule has three key elements. First, we are finalizing changes to the

Environmental Protection Agency's (EPA) fuel economy testing and calculation

procedures so that the miles per gallon (mpg) estimates for passenger cars and light-duty

trucks will better reflect what consumers achieve in the real-world. Second, we are

updating the fuel economy window sticker that appears on all new cars and light trucks

sold in the U.S., which will make the window sticker more useful and understandable to

consumers. Third, for the first time we are requiring fuel economy labeling of certain

passenger vehicles between 8,500 and 10,000 lbs gross vehicle weight rating (GVWR),

such as the largest sport-utility vehicles (SUVs) and passenger vans. The application of

fuel economy label will be analyzed during the year 2009 to 2017. The analysis will

include the prediction of number of cars during that period, and economical group

analysis; the amount of fuel savings, bill savings, and annual savings. In the

environmental point of view, will be calculated the rate of emission reduction of; CO2,

NOx, SO2, and CO.


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3. Methodology

This study and data analysis is using the following terms:

3.1. Fuel savings (FS)

Fuel savings from labeling is the multiplication between Applicable stock and

Unit fuel savings. This can be calculated using the following equation:

FS = AS x UFS

3.2. Bill savings (BS)

The bill savings is a function of fuel savings and the average price of fuel (FP).

The potential bill savings is calculated by the following equation:

BS = FS x FP

3.3. Capital recovery factor

The capital recovery factor is the correlation between the discount rate and the

lifetime, this correlation is calculated by the following equation; which include the

discount rate (d):

3.4. et savings

There are two methods to calculate economical impact of motor retrofit i.e.

annualized costs and cash flow. In the first method, the incremental cost (IC) spreads

over the lifetime of the efficient motor so that the pattern of expenditures matches the

flow of bill savings. The Annual Net Savings (ANS) over time and calculated by the

following calculation, which include BS, NR, Incremental Cost (IC), and Capital

Recovery Factor (CRF).


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AS = BS - sum(R x IC) x CRF

IC = PPE - PPUE

IC is the difference between Purchase Price of efficient (PPE) and unefficient (PPUE)

motors.

The second method is the cash flow over the lifetime of the efficient motor, where

the motor is paid for full when it is installed. The purchasers incur the incremental cost

when the motor is purchased, but the benefit of higher energy efficiency is spreads over

the motor efficiency. The Net Savings (NS) in term of actual cash flows is calculated by

the following equation:

S = BS - sum(R x IC)

3.5. Cumulative present value (PV)

The cumulative present value is calculated using the percentage of discount rate.

The cumulative present value of the annualized net savings is calculated by the following

equation:

3.6. Emissions reduction (ER)

The environmental impact from labeling is potential reduction of greenhouse

gasses or other element that caused negative impact to the environment. The common

emission reductions are usually, CO2, SO2, NOx and CO. The emission reduction is a

function of energy savings. The emission reduction can be expressed mathematically by

the following equation:

ERpollutant = sum (Pfuel x m) x ES

Pfuel : percentage of power sourced from this fuel

m : mass of pollutant per kWh


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4. Result and Discussion

The result of calculation using the listed formulas, are presented as follows:

Table 4: Number of cars and economical analysis

Sh AS SF UFS FS (ltr/year) BS (RM) AS (RM)

Year umber of

Car

ltr/year UFS*AS FS*PF FSxPF-(ASxCRFxSFxIIC) E

2000 4145982

2001 4557992

2002 5001273

2003 5053856

2004 5520538

2005 60123162006 6529190

2007 7071160

2008 7638226

2009 8230388 5150154 5150154 1 240 1236036960 2224866528 2171971871 1

2010 8847646 5618531 10768685 1 240 2584484400 4652071920 4545445785 4

2011 9490000 5696210 16464895 1 240 3951574800 7112834640 6949807482 6

2012 10157450 6187988 22652883 1 240 5436691920 9786045456 9561747935 9

2013 10849996 6704862 29357745 1 240 7045858800 12682545840 12391860128 1

2014 11567638 7246832 36604577 1 240 8785098480 15813177264 15450737045 1

2015 12310376 7813898 44418475 1 240 10660434000 19188781200 18748971670 1

2016 13078210 8406060 52824535 1 240 12677888400 22820199120 22297156987 22017 13871140 9023318 61847853 1 240 14843484720 26718272496 26105885980 2


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Fig 2:Emission reduction

2009 2010 2011 2012 2013 2014 2015 2016 2017

Year

CO2&

SO2

0

10000

20000

30000

40000

50000

60000

NOx&

CO

CO2

SO2

NOx

CO

5. Conclusions

The application fuel economy label had shown an economical and environmental benefit

for the country. Economically, the method increases the Bill Savings up to RM 30 billions

(2017), also increases the Annual Net Savings up to RM 30 billions (2017), and the Fuel

Savings up to 14 Gigalitre a year (2017).

In the environmental point of view, the method increases the emission reduction. In the

year of 2016, CO2 reduction reaches 7,000 kton, SO2 reaches 51 kton, NOx reaches 23 kton,

and CO reaches 4 kton. The labeling method has mathematically proven to greatly save the

financial expenses and reduce the emission to the environment.


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References

Dr. Indra Mahlia, Energy Policy-Energy Label: Economical and Environmental Impact,

Lecture Paper of Energy Efficiency, 2007

Appendix

Fig 3:Number of cars prediction

y = 12548x2 + 52598x + 1E+06R2 = 0.9987

0

1000000

2000000

3000000

4000000

5000000

6000000

0 2 4 6 8 10 12 14 16

No

No

ofcars

ENERGY, ECONOMICAL, AND ENVIRONMENTAL IMPACT OF IMPLEMENTING FUEL ECONOMY LABEL FOR CARS IN MALAYSIA

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