DOT, EPA issue final rules for heavy-duty trucks greenhouse gas and fuel efficiency standards

Earlier today, the United States Environmental Protection Agency and the Department of Transportation’s National Highway Traffic Safety Administration announced their jointly finalized standards for medium- and heavy-duty vehicles that will augment fuel efficiency and reduce carbon pollution.

This final rulemaking marks the culmination of standards rolled out in June 2015 by the DOT and EPA. And it also leverages the current fuel efficiency and GHG standards in place for model years 2014-2018, which DOT and EPA said will result in 270 million metric tons in CO2 emissions reductions and reduce vehicle owners fuel costs by more than $50 billion. The first round of these truck standards covered model year 2014 and 2015 trucks.

DOT and EPA said that the final phase two standards were called for by President Obama’s Climate Action Plan in response to the President’s 2014 directive to develop new standards into the next decade.

And the agencies added that this final phase two program promotes a new generation of cleaner, more fuel efficient trucks by encouraging the wider application of currently available technologies and the development of new and advanced cost-effective technologies through model year 2027. The final standards are expected to lower CO2 emissions by approximately 1.1 billion metric tons, save vehicle owners fuel costs of about $170 billion, and reduce oil consumption by up to two billion barrels over the lifetime of the vehicles sold under the program. The final standards are cost effective for both consumers and businesses, delivering favorable payback periods for truck owners, they said, adding that the buyer of a new long-haul truck in 2027 would recoup the investment in fuel-efficient technology in less than two years through fuel savings.

“The actions we take today on climate change will help lessen the impacts on future generations,” said EPA Administrator Gina McCarthy. “This next phase of standards for heavy and medium duty vehicles will significantly reduce greenhouse gas emissions while driving innovation, and will ensure that the United States continues to lead the world in developing fuel efficient technologies through the next decade and beyond.”  

This rulemaking has a sharp freight transportation and supply chain focus, considering that heavy-duty trucks represent the second largest segment and collectively account for the largest increase in U.S. transportation in terms of emissions and energy use, said DOT and EPA. What’s more, they added that globally GHG emissions from heavy-duty vehicles are growing at a quick clip and expected to surpass emissions from passenger vehicles in 2030. 

These vehicle and engine performance standards would cover model years 2021-2027 for semi-trucks, large pickup trucks, and work trucks, among other vehicles. And when the standards are fully phased in, DOT and EPA said tractors in a tractor trailer, as an example, will see up to 25 percent lower CO2 emissions and fuel consumption compared to an equivalent tractor in 2018.

“This is a good rule for all entities involved,” said Environmental Defense Fund (EDF) Senior Manager, Supply Chain Logistics Jason Mathers.  “For trucking companies, it provides the certainty of long-term standards in knowing their trucks will get more efficient over the next decade-plus. That is important, given that the standards will drive manufacturers to invest and build better quality products that will ultimately drive savings for truckers.”

On the shipper side, he said that this ruling is a clear win in that these standards will drive total cost of ownership savings that will come in the form of lower fuel usage and lower fuel surcharges, too, which he called a big win for them.

“For large consumer brand companies, we think this could result in several hundred millions in savings per year,” he said.