It wasn't supposed to be like this. The trucking industry largely expected the transition to the 2010 emissions rules to occur pretty much without a hitch. After all, the emissions control systems being deployed to meet the 2010 standards — selective catalytic reduction (SCR) and advanced exhaust gas recirculation (EGR) — were “known technologies” that had been around for a while.

And though freight volumes started to slump halfway through 2008 while fuel prices yo-yoed to new highs and lows, truck and engine OEMs still figured there would be a pre-buy ahead of the new standards in late 2009, maybe not as severe a spike as what occurred in late 2006 before the 2007 standards, but one that would at least offer a chance to reap some healthy revenues ahead of another expensive technological changeover.

What a difference a few months makes. The U.S. economic slowdown turned into a full-blown global recession, new-truck sales cratered, and the expected pre-buy vanished from the forecasts of most OEMs. With fleets and owner-operators focusing on survival, plans to buy new equipment may well be shoved deep into 2010 — if they buy any at all — delaying any expected return on the hundreds of millions in research and technology OEMs invested preparing for stricter emissions rules.

The downturn proved so bad that Navistar International joined forces with the Owner-Operator Independent Drivers Assn. (OOIDA) to request an “economic exemption” to the 2010 rules — allowing OEMs to keep selling 2007-compliant engines past the Jan. 1 2010, deadline. While the Environmental Protection Agency (EPA) denied that request, the issue of delay continues to crop up as the economic outlook remains gloomy at best.

The EPA fired an even more serious shot across the bow in a Dec. 11 letter last year to Cummins Inc., publicly calling into question the safety of its SCR technology, in particular the use of copper zeolite as a catalyst material to reduce the oxides of nitrogen (NOx) levels in diesel exhaust.

“The EPA has a long-standing concern that copper has the potential to catalyze dioxin formation in conditions experienced in incinerators and in diesel exhaust,” wrote Karl Simon, director of the agency's compliance and innovative strategies division, in his letter to the engine maker. “Therefore, questions have been raised regarding the potential for copper containing diesel SCR catalysts to promote the formation of dioxin compounds.”

As a result, EPA is conducting its own tests of engines equipped with copper-zeolite-based SCR technology (a time-consuming process at best, and this with less than a year to go before the deadline) and warned even “inconclusive results” would prevent those engines from being certified — a move that in effect would tell truckers not to buy them.

“If the data are inconclusive or show increased dioxin emissions, then the EPA likely will not certify an engine family utilizing such products unless a manufacturer can provide data that demonstrates the intended use of the copper catalyst doesn't increase dioxin emissions,” Simon stresses. “Emissions test data provided for this purpose must have been conducted using sound sampling and testing protocol.”

Not exactly a move that creates a smooth final approach to the 2010 deadline.

MORE A BUMP THAN BUST

Most industry experts, however, contend that the EPA's moves are in no way a death knell for Cummins' SCR package and do not herald the unraveling of the 2010 emissions deadlines.

“This is a new generation of SCR technology. While it's been in use in Europe for some time, it's being tweaked for U.S. trucking applications, so there are bound to be some bumps in the road,” explains Allen Schaeffer, executive director of the Diesel Technology Forum (DTF). “This is just one of those bumps. We're bound to find some issues because a lot of new components are being deployed for 2010.”

Cummins initially didn't plan on using SCR for its heavy-duty truck engine family — until the full potential for copper zeolite as a catalyst came into focus. According to Steve Charlton, vp of heavy-duty engineering for Cummins, although copper zeolite has been around for a long time, it wasn't in research labs until roughly three years ago and only became available for automotive applications in 2007.

“Copper zeolite is very, very efficient at reducing NOx compared to other catalysts,” notes Charlton, adding that its use within SCR should allow Cummins' 2010 engines to achieve up to a 5% improvement in fuel economy while meeting the EPA regulations.

Charlton also stresses that although everyone in the industry will be using EGR, all the engine OEMs except for Navistar plan to use EGR in combination with SCR to achieve lower emissions and better fuel economy simultaneously. “It's really the combination of EGR and SCR that makes this work, along with the diesel particulate filter [DPF],” he says.

Tina Vujovich, vp-marketing and environmental policy for Cummins, adds that the EPA's concerns are overblown. “Based on what we've seen so far, we don't have any concern about dioxins,” she explains.

Because of copper zeolite's benefits, Vujovich believes Cummins should have no problem passing EPA's inspections. “EPA is not in the business of shutting down manufacturers,” she says. “If they thought [copper zeolite] was a showstopper, they would have already told us. We feel very confident in the work we've done, and it's in their best interest and our best interest to get this approved.”

Other engine OEMs using SCR but not copper zeolite as a catalyst note that they don't believe the EPA is taking a negative view of SCR technology as a whole — far from it.

“We're getting no such reading from the EPA,” says David McKenna, Mack Truck's powertrain marketing manager. “Our understanding is that their concerns have to do with the high-temperature catalytic performance of copper-coated zeolite material and the voluntary withdrawal of such catalysts in Japan. We use an iron-coated zeolite system [and] there's no appreciable difference in the NOx reduction efficiency rate — 99% with copper and 98% with iron — [plus] nothing hazardous associated with our approach.”

“You've got to remember, too, that if the EPA had any doubts about SCR, they could just look across the pond at Europe; they can see years of SCR experience over there,” notes DTF's Schaeffer. “Also, according to the rules, the EPA needs to give the OEMs both lead time to develop new technology to meet the emissions requirements and then a period of regulatory ‘stability.’ They can't have a moving emissions target every couple of years. More importantly, they must give OEMs lead time to develop technology to meet the required emissions levels.”

THE FREIGHT RECESSION

Clouding the 2010 emissions picture further is the long-term “freight recession” in the U.S. — a trend that keeps worsening, dampening demand for trucks. “The recession in the freight market started almost three years ago, when U.S. economic growth slowed from 3 to 4% a year down to between zero and 1%,” explains Noel Perry, managing director and senior consultant at FTR Consulting Group.

Formerly chief economist with Green Bay, WI-based truckload carrier Schneider National, Perry says the freight market is now in true collapse — possibly contracting a further 10% in 2009.

As a result, new-truck sales are plummeting to new lows, reports Eric Starks, president of FTR Associates. FTR projects Class 8 sales in 2009 to be about 135,000 but could dip to about 95,000 under a “worst-case” scenario; however, Starks believes it might go even lower. In the fourth quarter last year, monthly Class 8 orders indicated an annual sales rate of 119,000 to a low of 104,000 units using just December's numbers as a guide, so it's very conceivable sales could continue to drop.

“The average age of vehicles is increasing and could overtake the all-time high from 1992 sometime between 2010 and 2012,” Starks notes. “Also, the size of fleets is shrinking, down 8% in 2008, so some old trucks are just not being replaced at all. “

That might make the higher sticker prices for trucks equipped with 2010 emissions reduction technology an almost impossible sell, which is why Navistar and OOIDA requested an “economic exemption” to the 2010 deadline. The EPA, however, flatly rejected any such exemption earlier this year.

“We finalized the rule several years ago [and] it is on track to have the final phase kick in by 2010,” says Catherine Milbourn, EPA's senior press officer. “We do not plan to alter the rule.”

Still, Navistar remains hopeful that the EPA may reconsider its decision in light of continued economic difficulties, says Tim Schick, director of business and product development for the company's engine group. “The EPA's decision was elicited as a final response, but as the economy is still in the doldrums, it may be those conditions could resonate more strongly,” he points out. “We'd like the trucking market to have options, because 2010 technology is going to bring added charges for everyone.”

The rest of the engine-making community, however, believes altering the 2010 timetable would create only more uncertainty and trouble. “We recommend that customers try to maintain their equipment replacement cycles and not disrupt their business and capital expense plans,” Mack's McKenna notes. “Our industry is still experiencing the impact of pre-buying ahead of the U.S. '07 [emissions rules]. The trucks Mack is bringing to market next year will have the same MP engines we offer today — the only difference being one more year of real-world experience backing them up.”

“All of this is pushing the benefits of 2010 technology back by many years,” DTF's Schaeffer says. “We're delaying the benefit of cleaner technology because no one can afford it due to the economy. That also means the industry will be passing up the economic advantages, too, leaving fuel economy benefits on the shelf. Instead, we'll be burning extra gallons of fuel.”

TESTING 2010

Getting an advance feel for how new emissions reduction technology is going to work in the real world is critical for fleets, especially in terms of detecting potential problems. That's a tactic Michael Brannigan, senior vp and chief of operations for the fleet management solutions at Ryder System Inc. , employed for his company in the run-up to 2007 and he expects to do the same for 2010.

“We do, in fact, work closely with OEMs to test new engine technology in addition to all the ongoing work we do with them on performance of existing vehicles/components, new product design and so forth,” he says. “We believe that our customers expect us to bring all of our experience and leverage to bear to work with OEMs to address any performance issues or opportunities to improve overall vehicle/component performance.”

Brannigan says Ryder expects to have 2010-model test trucks and engines from multiple OEMs running in its fleet within the next several months for a complete evaluation, placing test units in its own internal fleet operations as well as with full-service leasing customers to gather performance data in different climates (warm or cold) and different applications (high mileage, short haul, etc.) to get a better understanding of the technology.

“Our testing is designed to evaluate performance of the engines in more of a real-world application with real customers in a real operating environment,” he explains. “In the latest testing in advance of EPA '07, we were able to provide feedback and recommended solutions for a number of ‘bugs’ we encountered in the test vehicles.”

He notes that Ryder will ultimately test products from at least three different truck and four different engine OEMs, with evaluations encompassing both SCR and non-SCR technology. “We will be testing both medium and heavy-duty product consistent with the vehicles in operation in our fleet,” Brannigan says. “We understand that the only 2010-compliant engines in operation at this point are in the OEMs' reliability fleets [but] we expect to be among the first private customers to receive test product.”