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The new 2.0L gasoline engine for ACCORD Plug-in Hybrid was developed as a next-generation Honda engine series. This engine's features are low fuel consumption and good emission performance. Variable valve Timing and Electric Control (VTEC) system is applied to this engine, so we can have two characteristic cams, output cam and fuel economy (FE) cam. Output cam is narrow duration, used for power and engine starting. FE cam is wide duration, so it can get Atkinson cycle effect by late intake valve close timing (IVC). Cooled exhaust gas recirculation (Cooled-EGR) is applied to this engine. Low fuel consumption is achieved by combining VTEC and cooled EGR. We made the improvement of control systems. First is the new control which can secure the pressure difference before and behind the EGR valve. As a result, EGR flow control performance is improved. Second is improvement of torque control. It can predict an engine torque decrease when ignition retard is carried out.