WASHINGTON — The Biden administration’s newly unveiled standards aimed at drastically reducing carbon emissions from heavy trucks would boost equipment costs for manufacturers, fleets and owner-operators.
In a 717-page preamble to the proposed rule released on Wednesday, the Environmental Protection Agency’s new greenhouse gas standards for heavy trucks would begin in model year (MY) 2028 and extend to MY 2032, and would govern a range of truck sizes from delivery trucks and dump trucks to freight-hauling day-cab and sleeper-cab trucks.
The new rule for trucks are the third phase of carbon dioxide emission standards that began during the Obama administration. They would also reopen for revisions the GHG standards for the 2027 model year that were established under EPA’s Phase 2 rule in 2016.
In addition, the agency is proposing to add warranty requirements for batteries and other components of zero-emission vehicles as well as revisions to certain test procedures for heavy-duty engines.
EPA notes that the proposed rule does not mandate a specific technology to meet the new standards, and that EPA “anticipates that a compliant fleet under the proposed standards would include a diverse range of technologies (e.g., transmission technologies, aerodynamic improvements, engine technologies, battery electric powertrains, hydrogen fuel cell powertrains, etc.)”
It also points out that in 2022, “there were a number of manufacturers producing fully electric heavy duty vehicles for use in a number of applications, and these small volumes are expected to rise.”
The agency estimates the new standards will cost truck manufacturers $9 billion before considering the battery tax credits that were included in the Inflation Reduction Act. Including those credits reduces the compliance cost to manufacturers to $5.7 billion.
For MY 2032, EPA estimates the upfront cost difference — including tax credits — between the retail price for an electric truck and one with an internal combustion engine at $582 for a short-haul day-cab tractor. That difference jumps to $14,712 for a long-haul sleeper-cab tractor.
“The incremental upfront costs (after the tax credits) are recovered through operational savings such that pay back occurs after three years for short-haul tractors and after seven years on average for long-haul tractors,” according to EPA.
American Trucking Associations President and CEO Chris Spear said that while the standards are directed at truck manufacturers, the purchasing decisions of their customers “will ultimately determine their level of success.”
“As we review the proposed rule, ATA will remain engaged in the regulatory process to ensure the agency arrives at a regulation that has realistic equipment adoption timelines, is technologically feasible, and will not cause additional inflationary pressures if finalized,” Spear stated.
He also said he was “extremely disappointed” that the Biden administration is reopening the Phase 2 regulation.
“To make the plans and investments necessary for a successful transition, our industry needs regulatory certainty — not whimsical changes of mind from year to year. If EPA wants us to remain a willing participant, their going back and changing what was already agreed upon is not how to do it.”
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