Open up any newspaper this week and you will see that VW – one of the leading global automakers – is paying up big for its emissions cheating scandal. The recent settlement reached with the Department of Justice, 44 states and civil litigators will result in a $15 billion check from the automaker. Yet, according to the proposed settlement, VW will establish a $2.7 billion fund to introduce new technologies to clean up the emissions its faulty cars generated. Here, clean diesel will play an enormous role in delivering clean air benefits to communities around the country.
Tucked away in the settlement agreement announced this week between VW, the Department of Justice and others is a $2.7 billion trust to provide funding for the owners of older heavy-duty vehicles and equipment to purchase new vehicles. When it comes to heavy-duty applications, diesel is quite often the only game in town thanks to the energy density of diesel fuel and the inherent efficiency of the diesel engine. Thanks to decades of innovation, research and development, new diesel engines yield enormous reductions in emissions including oxides of nitrogen (NOx) – the pollutant of concern in the VW emissions cheating scandal. For commercial vehicles, rules established by the U.S. Environmental Protection Agency (EPA) require near-zero emissions of NOx beginning with trucks rolling off assembly lines as of 2010. Clean diesel technology developed to meet this near-zero NOx standard results in a 98 percent reduction in emissions relative to a truck manufactured in 1988. In fact, a single model year 2010 compliant truck can eliminate just over one ton of NOx emissions in a single year relative to a previous generation of technology. Similar near-zero NOx emissions standards established for commercial vehicles are now required of the enormous variety of off-road equipment including agricultural and construction equipment, locomotives and marine applications.
While these near-zero NOx emission reduction technologies are available, getting them into the population of on- and off-road vehicles and equipment remains tricky. Today, after more than five years since the near-zero NOx emission reduction requirement for commercial vehicles went into effect, three-in-four trucks on the road do not come with an engine that meets the standard. It is estimated that the population of off-road equipment maybe older as well given the longevity and durability of these engines.
The turn-over of the fleet to new technology diesel engines may provide enormous benefits. The South Coast Air Quality Management District (SCAQMD) that manages air quality for the enormous Los Angeles area, estimates that NOx emissions attributable to the fleet of diesel vehicles in the region could fall immediately by 70 percent, or over 80 tons per day, if all trucks in the area met the model year 2010 standard. Across California, according to research commissioned by the Diesel Technology Forum, an additional 280,000 tons of NOx could be eliminated in a single year if all commercial vehicles came with an engine that meets the current near-zero NOx emissions standard set for model year 2010.
Getting more of these near-zero emissions diesel technologies into the population of trucks and equipment can generate substantial air quality benefits. The settlement VW reached with the Department of Justice and others will do just that. According to the consent decree made public on June 28th, the automaker will establish a $2.7 billion trust fund to help the owners of older trucks, transit and school buses, construction and agricultural equipment, airport support vehicles, locomotives and switch engines, tug boats and marine equipment and ocean going vessels scrap or replace older engines and equipment for new.
The program is modeled very closely to a longstanding EPA program that provides incentive funding for the owners of older vehicles and equipment upgrade or replace with new technologies. The Diesel Emission Reduction Act (DERA) has provided over $500 million in funding for these activities since the program began in 2008. DERA funding has touched over 50,000 pieces of equipment and generated over 300,000 tons of NOx reduced.
Despite the enormous success of the DERA program, the EPA estimates that there are just over one million vehicles and pieces of equipment powered by older engines still in use around the country. The trust established by the VW settlement provides five times as much funding as the entire DERA program received since its inception in 2008. To put this perspective, California is on-track to receive $381 million, the entire DERA program received $520 million between 2008 – 2013. The mitigation program may go a long way towards replacing older equipment and clean diesel technology will be available to deliver these clean air benefits in communities across the country.