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Keeping Options Open in the Transportation Energy Revolution

    The transportation energy revolution is here, bringing fundamental change to our personal mobility as well as looking to revolutionize how freight moves and goods get delivered.

    The change-up conversation is fast and furious; thick with announcements of those here now and coming in the future. In the age of delivery drones, air taxis, or all-electric autonomous vehicles, some say this change is necessary and good… and we must have policies to end the internal combustion engine era.

    But this change is not for the better. Nor is it necessary.

    Fuel and technology-agnostic standards have been the foundation of clean air progress for the last two decades. The U.S. Environmental Protection Agency and California Air Resources Board followed traditional roles as regulatory agencies that established a set of numerical standards for allowable levels of emissions, and manufacturers would determine how best to meet those standards.

    Today’s near-zero emissions performance of diesel engines is a good example. Nowhere in the rules or regulations is it specified that manufacturers must use particulate traps to reduce particulate matter or selective catalytic reduction (SCR) systems to reduce nitrogen oxide (NOx) emissions. All the rule says is that they must not exceed NOx and PM emissions standards (along with other conditions including useful life, various periods of engine operation, etc.).

    It gives manufacturers the freedom to innovate and develop approaches as well as technologies that best serve their customers. The customer benefitted from manufacturer competition and having options, as they continue to do today. Manufacturers pursued various approaches, particularly in the off-road engine and equipment space. Most highway trucks built since 2011 have the same emissions control systems – particulate filters and SCR, but there is more diversity in strategy for reducing emissions in off road engines and equipment.

    If a certain strategy were more or less expensive, or created problems for the customer, it would not be offered. Or the manufacturer would find a better way to meet the mutual goals of regulatory compliance, customer satisfaction, and favorable business outcomes.

    This fuel and technology-agnostic standard-setting approach is in serious jeopardy; already being pushed to the wayside. Traditional regulators have turned into technology advocates. Bans and mandates appear more in control of the fuels and technologies of the future, rather than free market choices and innovation. Banning technologies makes for good political headlines but throws performance-based standards under the electric bus.

    The growing number of public company pledges outlining strategies and timeframes for achieving net zero carbon and introducing zero emission vehicles (ZEVs) are strong evidence of industry’s pivot toward the new energy future. Performance based standards would let customers decide if, and when, which technologies make sense for them.

    Next month California policymakers are considering yet another step to design the truck and fleet of the future on their exclusive – not inclusive – terms with consideration of the so-called “Advanced Clean Fleets Rule.” If the current policymaking approach is followed, the California Air Resources Board will effectively ban fleets from future purchases of gasoline, diesel, natural gas, and propane trucks starting in 2040. This is despite the fact that the vehicles on the road at that time will be so very close to zero emissions and using more renewable biofuels, or perhaps other e-fuels we can’t yet see, that the measurable difference compared the ZEV will be minuscule. At this point, some say the key business decisions for truckers and truck and engine makers will largely be under the control of California regulators. Is the Advanced Clean Fleet Rule legally an “emissions standard” under the Clean Air Act? We shall see.

    The California Air Resources Board has been leading the charge to reduce emissions from heavy duty diesel vehicles for decades; now pushing farther and closer to zero. And there has been tremendous progress and investment to meet these, as well as future, nearer-to-zero emissions goals. With the increasing use of low carbon renewable biodiesel fuels in the trucking fleet, we’re already seeing benefits in the form of reduced greenhouse gases and other ozone-contributing. This is what the ban will target.

    An extraordinary amount of federal, and California, taxpayer dollars is creating unprecedented levels of incentives to put zero emission vehicles into service. At the federal level, a major boost comes from a $40,000 tax credit for purchasing a new zero emission truck and up to $100,000 for the essential fueling infrastructure as part of the $79 Billion in clean energy incentives under the Inflation Reduction Act. This is the kind of support needed to get more new fuels and technologies into service.

    About half of California’s diesel truck fleet on the road today is the newest generation of advanced diesel with near-zero emissions. That number has ticked up slowly over the past five years, yet lags behind the national average of 53%, thanks to the state’s business climate as well as a fleet rule dictating allowable ages of trucks.

    California’s present path on the Advanced Clean Fleet Rule, which includes banning of future purchases of internal combustion engines, should be rejected for three reasons.

    First, it’s not a performance based standard and violates a basic principle of policymaking, picking winners and losers.

    Also, it needlessly removes viable, affordable, and available choices for truckers. Once the oldest diesel trucks are retired, new technology diesels will be racking up clean air benefits more than ever, and if more renewable low carbon diesel fuels are used, that will boost near-term carbon reductions well before the massive buildout of infrastructure for fueling ZEVs.

    And California might come to need continued super low emission diesel, and other internal combustion engines, beyond 2040 to sustain progress if plans for ZEVs and infrastructure don’t pan out in the timeframe or trajectory they hope.

    This reminds me of an old joke about a car salesperson working with a new customer. They explain what they’re looking for, and the eager salesperson leads them through many rows of cars…  all red in color. When the customer looks confused, the salesperson says, “You can have any color you want… as long as it is red.”

    With the complex and unpredictable nature of climate change, there may be more twists in the road ahead than we know. Having more choices and assets at our disposal now, and in the future, makes sense. It’s practical. Why would we want to take any proven technology and fuel option off the table?

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