Understanding the EPA’s Potential New Commercial Vehicle Emissions Standards

In recent months, the potential benefits of Zero-Emission Vehicles (ZEVs) have captured the transportation community’s attention. Amid significant emissions-focused legislative and regulatory actions occurring at the federal and state levels, many in the industry are working hard to understand these actions’ possible effects and how companies might adapt – including what ZEV options are available to fleets, and what considerations they need to take into account when making decisions on which direction, or directions, to head.

In its recent regulatory action, the Environmental Protection Agency (EPA) noted that “The Transportation Sector is the largest U.S. source of greenhouse gas (GHG) emissions, representing 27% of total GHG emissions. Within the transportation sector, heavy-duty vehicles are the second largest contributor to GHG emissions and are responsible for 25% of GHG emissions in the sector.”

These recent actions have the potential to dramatically impact the commercial transportation sector and understanding them is critical. In this piece, we will explore what the actions are and explain their potential impact on transportation companies.

The Environmental Protection Agency’s Recent Actions

In August of 2021, the EPA announced it would publish a series of rules over the following several years aimed at reducing greenhouse gas emissions and other pollutants by heavy trucks. Dubbed the “Clean Trucks Plan,” the first action was a final rule -- Control of Air Pollution from New Motor Vehicles: Heavy-Duty Engine and Vehicles Standards -- published December 20, 2022, which aims to reduce NOx emissions on heavy-duty vehicles and engines starting with Model Year 2027 trucks.

This final rule establishes new numeric standards and changes key provisions of the heavy-duty emissions control program, including a wider range of test procedures, a longer useful life of the truck, significant increases to the emissions-related warranty periods and other requirements.

The EPA’s second action under the Clean Trucks Plan was proposing more stringent standards to reduce GHG emissions for heavy-duty vehicles beginning in model year (MY) 2027. The rulemaking – also referred to as GHG Phase 3 – would enact new standards applicable to vocational vehicles (delivery trucks, refuse haulers, public utility trucks, etc.) and tractors. The proposal would also implement stronger CO2 standards that go beyond those established under the GHG Phase 2 program. As part of its rulemaking, the EPA is also proposing an additional set of CO2 standards to begin in MY 2028 vehicles, with progressively lower standards through MY 2032.

EPA's Proposed ZEV Standards (% new ZEV HDV sales)

Comments on EPA’s proposal are due June 13, 2023. To justify its proposed adoption timeline, EPA pointed to the faster than anticipated adoption of zero-emissions technologies for heavy-duty trucks, that ZEV vehicles are in use today in many applications, costs for ZEVs are going down and manufacturers are implementing plans to accelerate their investments in ZEV technologies over the next decade.

These observations, along with the grants and incentives outlined in the Bipartisan Infrastructure Law (2021) and Inflation Reduction Act (2022) for the production and sale of ZEVs, and development of the required infrastructure, collectively are expected to significantly advance ZEVs in the heavy-duty vehicle sector.

California Air Resources Board Transition

For its part, the California Air Resources Board (CARB) is in the midst of a transition to zero-emission medium- and heavy-duty vehicles. As a part of this transition, they have enacted and are working on several regulatory measures. One such measure that has been adopted is the Advanced Clean Trucks (ACT) regulation, which requires manufacturers, starting in MY 2024, to sell an increasing percentage of zero-emission heavy duty trucks.

Advanced Clean Trucks (ACT) Regulation

• Major manufacturers must sell ZEVs as a percentage of sales*
• Credit for sales start in 2021
• Minimum tractor sales
• Flexibility to shift sales between categories
• Approved June 2020

*Partial credit for near-zero emissions vehicles (NZEVs) with minimum all electric range

Also, with CARB’s recent approval of its Advanced Clean Fleets (ACF) rule, starting with MY 2024 heavy trucks, it would enact fleet purchasing requirements on 3 categories of fleets: 1) drayage; 2) those owned by federal, state and local agencies; and 3) high-priority fleets.

Starting with MY 2024 heavy trucks, the regulation would apply to medium- and heavy-duty vehicles with a gross vehicle weight rating of greater than 8,500 pounds, off-road yard tractors, and light-duty mail and package delivery vehicles. The ACF would also enact a ZEV-only truck sales requirement starting in MY 2036 for vehicle classes 2b/3, 4-8 vocational and 7-8 tractor categories, with the goal of achieving a 100% ZEV truck and bus fleet in California by 2045.

Phase in timelines are different depending on the category of fleet. As an example, fleets that fall into categories 2 and 3 can choose a milestones option to meet their ZEV targets:

High priority fleets are defined as those that own, direct, or operate at least one vehicle in California and have either $50 million or more in gross revenue or that own, operate or have control of 50 or more vehicles.

Drayage, high priority and federal fleets will be allowed to continue using trucks older than MY2024 after the January 2023 deadline but only until the earlier of 18 years or 800,000 miles, or a minimum of 13 years if the truck has more than 800,000 miles.

In additional action by CARB from earlier this year, the first phase of its Heavy-Duty Inspection and Maintenance Program (HD I/M), which includes roadside monitoring, kicked in. The HD I/M program is intended to ensure emissions control systems on heavy-duty vehicles operate effectively for the life of the vehicle by reducing particulate matter and NOx emissions, and applies to all heavy-duty trucks, buses, agricultural equipment and motorhomes with a gross vehicle weight rating of more than 14,000 pounds traveling in California.

Phase 2, scheduled to start in July 2023, requires all heavy-duty trucks to register with CARB, verify the vehicles in their fleets, and pay a compliance fee for each vehicle. Phase 3, to begin in 2024, will require registered vehicles to provide proof of compliance. Emissions inspections will need to be completed twice per year for vehicles with onboard diagnostic systems (OBD), ramping up to four times per year in 2027. Older vehicles without an OBD system will continue opacity testing, with an added visual testing component to be twice each year.

The Biden Administration has issued waivers to California to allow them to implement and enforce these new CARB rules, which exceed what’s required under EPA rules. This is significant and has drawn criticism from the industry. Six other states – New York, New Jersey, Oregon, Washington, and Vermont -- are considering following California’s lead.

Looking Ahead to Electric Vehicles

The actions above, along with the incentives offered through recent federal legislation are aimed to accelerate the move to ZEVs with a focus on electric trucks. However, many in the transportation industry are pushing back on these rules, noting that the requirements include unrealistic timelines; battery performance and reliability is not yet proven; the increased weight of batteries will decrease payloads and tighten capacity; the rules will add significant cost to trucks and therefore delay new purchases, and the charging and fueling infrastructure is not ready, nor will it be, for many years.

And above all, the patchwork of rules across the country will create additional compliance challenges as commercial vehicles cross state lines to do their work. In our next piece on this topic, we’ll explore the ways transportation companies can incorporate these potential changes into their long-term plans and ensure their operations are ready to adapt.

At Trimble, we’re dedicated to providing our customers and partners the tools they need to meet their environmental sustainability objectives. To talk to our team about how we might help, please contact us.