President Obama has directed the Environmental Protection Agency (EPA) and the Dept. of Transportation (DOT) to jointly issue the first fuel efficiency and greenhouse gas (GHG) emission standards for medium- and heavy-duty trucks. The new rules will be phased in between model years 2014 and 2018.
“This will bring down costs for transporting goods, serving businesses and consumers alike. It will reduce pollution,” said the President in a special Rose Garden ceremony today, where he signed a “Presidential Memorandum” that, all with other energy policy initiatives, tasks EPA and DOT to create the standards for new commercial trucks.
“Just like the rule concerning cars, this [truck] standard will spur growth in the clean energy sector,” Obama said. “We know how important that is. We know that our dependence on foreign oil endangers our security and our economy. We know that climate change poses a threat to our way of life – in fact we are already beginning to see its profound and costly impact. And we know that our economic future depends on our leadership in the industries of the future.”
The new fuel economy and GHG standards for trucks follow similar rules issues earlier this year for cars and light trucks. In April, the administration completed new fuel regulations for passenger vehicles that will require a 30% decrease in carbon emissions and a 40% increase in auto fuel efficiency to 35 miles per gallon between model years 2012 and 2016.
Administration officials currently estimate that commercial trucks consume more than two million barrels of oil every day, and average 6.1 miles per gallon. They also emit 20% of the greenhouse gas pollution related to transportation.
The government’s preliminary estimates indicate great potential for significant fuel efficiency gains and greenhouse gas emissions reductions for large tractor-trailers, which represent half of all GHG emissions from this sector.
“We need to seize the momentum following last month’s historic new fuel economy and greenhouse gas emission standards and President Obama’s announcement today does just that,” said DOT Secry. Ray LaHood. “By expanding this effort to include medium- and heavy-duty trucks and encouraging the development of innovative technologies such as electric cars, we are laying the foundation for a cleaner, greener transportation sector that provides greater environmental benefits, reduces our dependence on oil and encourages American creativity.”
"The industry should have been preparing for this day since the legislation passed in 2007," David Kelly, former Acting Administrator of the National Highway Traffic Safety Administration (NHTSA), told FleetOwner, referring to the Energy Independence and Security Act of 2007 passed by Congress.
That legislation aimed to "move the United States toward greater energy independence and security, to increase the production of clean renewable fuels, to protect consumers, to increase the efficiency of products, buildings, and vehicles, to promote research on and deploy greenhouse gas capture and storage options, and to improve the energy performance of the Federal Government, and for other purposes."
"Fortunately for them, the Obama Administration did not set a specific target number and will instead allow NHTSA and EPA to undertake a rulemaking process that will set a fair standard determined by science and data," Kelly said.
The "data" Kelly referenced will come from analysis conducted by the National Research Council (NRC), from a report it issued last month titled "Technologies and Approaches to Reducing the Fuel Consumption of Medium- and Heavy-Duty Vehicles."
Other data indicates instituting such fuel efficiency standards could help President Obama achieve an altogether different policy goal: creating jobs.
A report released earlier this week by the Union of Concerned Scientists (UCS) and the Pasadena, CA-based Clean Transportation Technologies and Solutions (CalStart) organization said boosting fuel economy of new medium- and heavy-duty vehicles could create more than 120,000 new jobs nationwide by 2030, while curbing U.S. oil dependence
Using existing and emerging fuel-saving technology, the two groups said the U.S. could save four times more oil on an annual basis by 2030 than the volume expected from expanded offshore drilling in that same year.
In their report “Delivering Jobs: The Economic Costs and Benefits of Improving Heavy Duty Vehicle Fuel Economy,” the groups also found that fuel efficiency improvements could save Class 8 “big rig” fleet owners more than $120,000 per tractor-trailer over eight years and owner-operators more than $80,000 per tractor over 10 to 15 years, assuming an average $3.50 per gallon fuel price.
Medium- and heavy-duty trucks represent only 4% of all vehicles on U.S. highways, but they consume more than 20% of on-road transportation fuels. Improving the average fuel economy of these trucks by 3.7 mpg with current and near-term technologies would reduce U.S. annual oil consumption by 11 billion gallons in 2030, according to UCS.
UCS found that net cost savings from more efficient trucks would total $24 billion in 2030 at fuel prices of about $3.50 per gallon, after factoring in the cost of efficiency technologies.
“Truck owners struggle most with fuel price and volatility because fuel is typically the biggest cost of their business. But they are also very sensitive to higher vehicle costs,” said Bill Van Amburg, senior vp at CalStart. “That’s why we intentionally used conservative assumptions in our study and still found that new technologies that improve truck fuel economy will not only grow jobs but will save truck owners significant money – particularly if they evaluate the benefits over the vehicle’s life.”