This story is part of a series on California’s impending zero-emission vehicle regulations, which have the potential to upend the U.S. trucking industry. You can follow the stories here.
WASHINGTON — Political and economic realities are already putting obstacles in the way of the Biden administration’s Phase 3 trucking rule that could make it harder to achieve the regulation’s lofty goals.
Citing California’s Advanced Clean Trucks (ACT) rule as support, the U.S. Environmental Protection Agency is imposing strict new standards on the trucking industry, with varying estimates of the costs to both truck manufacturers and for truck buyers (see charts below).
Specifically, EPA is proposing stronger carbon dioxide standards for model year 2027 trucks that go beyond the current standards that apply under EPA’s Phase 2 rule. It also proposes an additional set of CO2 standards that would begin to apply in model year 2028, with progressively lower standards each model year through 2032.
By 2045, new trucks available for sale must be zero-emission vehicles, a goal that can only be achieved with electric vehicles (EVs) powered by a battery or hydrogen fuel cell.
First move cost
The trucking industry, both large carriers and owner operators, wasted no time opposing the rule soon after it was passed. published on April 27.
Cost has been highlighted as a major impediment. A new all-electric vehicle costs more than $400,000 today, compared to a new diesel truck in the $150,000 range.
Also, recharge times are too long, which affects federal hours-of-service regulations. Batteries weigh a lot, which puts early adopters at a disadvantage with other carriers in the amount of cargo they can carry and still meet highway weight limits.
“We operate in a market economy, so if we were to buy 200 new electric trucks, not only would it cost us a lot of money, but we probably wouldn’t be able to pass that on to our customers because most of the rest of the industry is still running on equipment older,” Laurence Cox, vice president of sustainability at Aliquippa, Pennsylvania-based PGT Trucking, told FreightWaves.
“Somewhere along the way, yes, the fees we charge customers will go up, but not initially.”
Owner-operators are even more wary of regulation. “The Phase 3 rule is … a blatant attempt to force consumers to buy electric vehicles while there is no national network of charging infrastructure for heavy commercial trucks,” said Lewie Pugh, executive vice president of the Independent Driver Association of Owners and Operators, to lawmakers at a supply chain hearing on Capitol Hill on May 10.
“Professional drivers are skeptical about EV costs, mileage, weight and battery safety, charging time and availability. It’s puzzling that the EPA is moving forward with more impractical emissions deadlines without address these overwhelming concerns earlier.”
Joe Rajkovacz, director of government affairs for the Western States Trucking Association, stressed the lack of coordination in the rulemaking between the EPA and the agencies that oversee the electric grid that will be needed to provide the power to the new trucks.
“I’m intrigued by a lot of technology and I’m not opposed to the move to electric vehicles,” Rajkovacz told FreightWaves. “But giving a truck buyer a mandate that will potentially leave them stranded on the road because there isn’t enough juice on the grid to power their vehicle makes no sense.”
Challenging the authority of the EPA
Conservative lawmakers and other policy influencers are also just as quickly mobilizing for a possible challenge to the EPA rule if it passes.
In speaking out against the Phase 3 truck rule and its companion rule governing light-duty vehicles, Rep. Pat Fallon, R-Texas and chairman of the Energy Policy and Regulatory Affairs Subcommittee of the House Oversight Committee Chamber, stated during a hearing on May 17. that “Republicans are not anti-EV. However, they are deeply concerned about the Biden administration’s apparent attempt to hijack the auto industry, stifle consumer choice, and determine which products are best for the American people when it comes to set deadlines”.
At the same hearing, Rep. Chuck Edwards, RN.C., noted that last year the U.S. Supreme Court “took the EPA down” in West Virginia v. EPA to exceed its authority in regulating power plants. “Isn’t the EPA doing the exact same thing with these proposed electric vehicle rules?” asked Steve Bradbury, speaking on behalf of the conservative Heritage Foundation.
“It’s really very similar,” Bradbury replied. “It’s a shift to a whole new technology, which is what they were trying to do with the EPA’s Clean Power Plan.
“At issue are matters of life, liberty and prosperity, and they are fundamentally political in nature. That is exactly why, under our constitutional republic, it is up to Congress, and Congress alone, to make the monumental decisions that EPA seeks to make in these proposed rules.”
Market alignment
But the California Air Resources Board (CARB), which oversees the state’s ACT rule after which EPA’s Phase 3 rule was modeled, doesn’t just see zero emissions as feasible for to all heavy trucks by 2045, but believes there is room to be even stricter. .
“EPA should end this with bold, zero-emission targets for heavy-duty trucks that extend to 2040,” said CARB Executive Officer Steven Cliff in commenting on the EPA rule. “EPA should finalize a Phase 3 rule to push significantly more heavy-duty trucks than proposed. The zero-emissions penetration in the final rule should be on par with vehicle manufacturer goals that many heavy truck manufacturers have been publicly declaring.”
Speaking at a May 17 House Oversight Committee hearing, Rep. Melanie Stansbury, DN.M., also rejected the notion that the trucking industry will not be able to meet EPA deadlines. “The industry is moving towards the electric market because that is the market of the future,” he said.
“This transition is crucial for our economy, crucial for our planet, and the important legislation we passed in the last Congress will help make that transition possible,” Stansbury said, referring to the grants and tax incentives. included in the Law of Investment in Infrastructures and Employment and Law of Reduction of Inflation.
Despite the challenges he sees in the regulations, PGT’s Cox said his company won’t be afraid to test the waters with a hydrogen electric vehicle, possibly before the end of the year.
“Our view is that somebody has to start, and we’d rather be at the top than at the bottom,” Cox said. “But at the same time, we’re a trucking company, which is a 5-7% margin business, so it’s not like we can do things with cost impunity. At some point the economy will have to match.”
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