The Environmental Protection Agency has plans to expand on its SmartWay Transport Partnership with carriers and shippers, including a pilot program to test the idea of financing fuel-saving equipment by using a portion of the money saved to repay loans.
Mike Zatz, an EPA official working on the SmartWay initiative, told attendees at the Truckload Carriers Association Fuel Economy Summit in Chicago that the agency is exploring several financing initiatives to help carriers that want fuel-saving technology but lack the capital to buy it.
SmartWay has identified a number of technologies to save fuel, including idle-reduction devices, trailer aerodynamics and aluminum wheels for single wide tires. In addition, there are emissions control devices that SmartWay promotes, including diesel oxidation catalysts and particulate matter filters, that help reduce emissions, although they don’t reduce carriers’ costs.
EPA calls this suite of technology the SmartWay Technology Upgrade Kit, and is pursuing ways to help carriers adopt appropriate elements of it, Zatz told the summit. For example, SmartWay has work with state-sponsored small business loan programs in Arkansas, Minnesota and Pennsylvania to offer attractive loan terms on SmartWay Upgrade Kits.
In addition, several commercial banks, including Wachovia and Wells Fargo, have expressed interest in a national loan program to offer attractive financing to trucking companies of all sizes, Zatz said. EPA also is working with the Owner Operator Independent Drivers Association’s truck financing program to incorporate fuel-saving technologies into the purchase of new or used trucks.
But perhaps the most unusual financing mechanism SmartWay is considering is a method called “performance contracting,” Zatz said. This would be similar to arrangements in the buildings sector, where energy service companies (ESCOs) buy technologies for use by companies with no initial capital outlay required by the company. Then, the companies pay a portion of the value of their energy savings to the ESCO for a predetermined period of time.
SmartWay is looking to conduct a pilot project for developing this concept for the trucking industry, Zatz said.