retail costs as a comparable substitute. 17 OPEI could not have raised this issue earlier because it did not arise until EPA published the Notice of Decision. The issue is also of central relevance. As EPA acknowledged in its Decision Document, the relevant “costs” under the CAA are the “costs of compliance for such manufacturers, i.e., costs that pertain to the manufacturers’ development and application of requisite technology to comply with the emissions standards.” 18 Yet EPA also noted that CARB’s analysis did “not cite direct costs to manufacturers,” and instead based its cost analysis on retail prices for marketed products. 19 Assuming “CARB used the best information available to it,” EPA concluded that CARB’s consideration of retail costs was a reasonable alternative and that costs of compliance by the manufacturers are not excessive. EPA’s consideration of retail costs was error and ignored evidence in the record. As detailed in OPEI’s petition for reconsideration, industry data that had been submitted to CARB established that costs to manufacturers are significant and not reasonably comparable to retail costs. Failure of CARB and EPA to consider costs of compliance to manufacturers when information about those costs was in the record resulted in erroneous cost determinations, including unreasonable assumptions on costs of compliance and overestimated benefits. These errors render EPA’s Notice of Decision inconsistent with the requirements of Section 202(a) of the CAA, under which EPA must consider costs of compliance. 20 b. EPA’s December 2024 Joint Report Recognized that ZEE Is Not Available for Commercial Equipment. OPEI also could not practicably have raised the issue of a joint report EPA and DOE issued in December 2024, just before EPA published the Notice of Decision and after the comment period had ended. 21 The report undercuts EPA’s analysis of “basic market demand,” which is the test EPA applies to determine whether there is adequate lead time to allow for the 17 Id. at 4–9. 18 Decision Document at 55, 56, 70 (recognizing EPA’s “duty” to consider costs of compliance to manufacturers). 19 Id. at 56. 20 Air Pollution Control; Preemption of State Regulation for Nonroad Engine and Vehicle Standards, 59 Fed. Reg. 36,969, 36,982-83 (July 20, 1994); see also California State Motor Vehicle Pollution Control Standards; Waiver of Federal Preemption; Decision, 61 Fed. Reg. 53,371, 53,372 (Oct. 11, 1996). 21 December 2024 Report.
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