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March 27, 2017   |   Diesel Technology Forum

Press Release

Oregon Can Benefit Most from VW Mitigation Funds Through Investing in Clean Diesel Technology

More Clean Air, Faster, Cheaper with Clean Diesel Than Other Options

 Salem, OR - Oregon’s effort to improve air quality with its $68 million allocation from the Volkswagen Environmental Mitigation Trust would achieve the most immediate and cost-effective benefits for the most people with advanced clean diesel technology, according to testimony from the Diesel Technology Forum citing data from the U.S. Environmental Protection Agency (EPA) and U.S. Department of Transportation (DOT).

The Forum’s written testimony was submitted in today’s hearing by the Oregon House Energy and Environment Committee focusing on potential investments of the state’s VW Mitigation Trust funding (see below).

Because the Trust was established with the express purpose of mitigating emissions of nitrogen oxides (NOx), we believe that Oregon must focus on the largest sources of NOx emissions and then make the most cost effective investments to achieve immediate term NOx reduction that will improve air quality in the near term for all Oregonians and ensure compliance with the goals of the Trust,” the Forum stated in its testimony.

“Oregon will undoubtedly receive many arguments and proposals for investing in various alternative fuels and technologies or infrastructure.  In nearly all these cases, the costs would be higher, the incremental NOx benefits would be lower, and they would accrue over a longer term than any clean diesel replacement options. 

U.S. EPA & DOT Data Highlights Cost-Effectiveness of Clean Diesel Technology

“Recent studies from U.S. EPA, U.S. DOT and other sources conclude that the most cost effective strategy to reduce NOx emissions from heavy-duty sources are investments in the latest clean diesel technology.  Investing Trust revenues in replacing older commercial vehicles with clean diesel technology will allow for greater immediate term air quality benefits beyond that of investments in other technologies, and provide more direct benefits to more small businesses and regions of Oregon than would other technologies and approaches. 

“The VW mitigation trust fund – if utilized effectively – will also allow Oregon to address issues that it has been discussing in recent years regarding accelerating the turnover of its commercial vehicle population.”

The Forum also noted that upgrading or replacing older off-road engines including switch locomotives and marine applications yields enormous air quality benefits and is one of the most cost effective near-term NOx investments that also would have one of the lowest administrative burdens for Oregon relative to other options that would entail a greater number of vehicles or projects.

“Given Oregon’s experience with the Diesel Emissions Reduction Act Program (DERA), the Trust provides that funds are eligible to be used as part of non-federal matching grants for eligible DERA projects.  This option would provide an even greater ability to introduce more new clean technology in a wider variety of off-road construction equipment throughout Oregon and enhance the reach of Oregon’s Clean Diesel Initiative managed by the Department of Environmental Quality,” the Forum stated.

In its testimony, the Forum outlined several reasons how Oregon and other states would benefit most from investing their VW Mitigation Trust funds in new advanced clean diesel technology:

Diesel engines, equipment and trucks are the technology of choice for key sectors of Oregon’s economy. Because of their unmatched combination of power, performance and efficiency, diesel engines are the technology of choice powering key sectors of Oregon’s economy, particularly the goods movement (trucks, railroads, workboats) construction and agricultural sectors.  Across the country, one out of every two economic sectors rely on diesel engines, vehicles and equipment. In Oregon, 70 percent of Class 3-8 trucks in use are powered by a diesel engine and diesel powers over 96 percent of the largest Class 8 trucks.

Oregon’s Trust investments should target the largest sources of NOx emissions. The largest sources of NOx emissions in the U.S., according to the latest emissions inventory conducted by U.S.EPA, are attributable to older heavy-duty vehicles and equipment including trucks, buses, construction and agricultural equipment, locomotives and marine workboats.

Targeting older commercial vehicles population of engines, vehicles and equipment will generate immediate term air quality benefits. Six out of every 10 commercial vehicles in Oregon -- just over 90,000 trucks -- are of an older generation technology built prior to 2010, without the full benefit of the latest clean diesel emissions controls that enable near-zero emissions for both nitrogen oxides and particulate matter.  This compares to a total diesel truck population of about 130,000, according to the latest vehicle-in-use data (Diesel Technology Forum analysis of IHS Automotive commercial vehicles in operation statistics for 2016).  Replacing the oldest of these commercial vehicles will do the most to reduce emissions quickly.

Off-Road Engines and Equipment. Off-road engines and equipment including marine vessels and locomotives have been required to achieve near near-zero emissions levels of NOx and Particulate Matter similar to the requirements for commercial vehicles. Beginning in 2014 (and 2015 for the largest applications including locomotives and marine vessels), new “Tier 4” emissions requirements for new engines are in effect which result in 90 percent to 95 percent reduction in emissions relative to the oldest engines of the same type.

Oregon should invest in proven and available technologies that yield proven clean air benefits.  Clean diesel is the most compelling option. As a result of decades of research and investment, clean diesel technology yields near-zero emissions, including NOx emissions, and is widely available today to provide immediate term air quality benefits.  Those standards require near-zero emissions, including NOx, for commercial vehicles beginning in model year 2010 and off-road equipment beginning in 2014. 

Clean Diesel is the most cost effective investment for trust revenue because it delivers more clean air for the dollar, faster than other strategies. While the settlement presents Oregon with an unexpected source of revenue, how the state choses to invest the dollars can maximize and expand the $68 million through the investment in cost-effective strategies.  The most cost-effective strategy to replace older commercial vehicles is investments in clean diesel technology.  On a dollar-for-dollar basis, recent evidence suggests that investments in proven and available clean diesel technology are a more cost-effective investment to reduce NOx and achieve the clean air priorities established by the Trust to generate immediate term benefits for Oregon residents.

According to key sources, clean diesel technology is the most cost effective means to reduce NOx emissions from a variety of commercial vehicles. The U.S. Department of Transportation, using the latest emissions model generated by the U.S. Environmental Protection Agency (EPA) found that 1 ton of NOx emissions may be eliminated by investing, on average, $20,000 in clean diesel technology versus, on average, $1 million in electric infrastructure.[1]  Replacing a model year 2000 engine found in a Class 8 truck, a school bus and a transit bus with a model year 2015 diesel engine is a more cost effective strategy than investments in electric vehicle charging infrastructure.

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The Diesel Technology Forum is a non-profit organization dedicated to raising awareness about the importance of diesel engines, fuel and technology. Forum members are leaders in clean diesel technology and represent the three key elements of the modern clean-diesel system: advanced engines, vehicles and equipment, cleaner diesel fuel and emissions-control systems. For more information visit www.dieselforum.org.

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[1] Congestion Mitigation and Air Quality (CMAQ) Improvement Program Cost-Effectiveness Tables Development and Methodology (December 3, 2015)


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