California last week officially got permission to crack down even further on diesel emissions inside the state, and it will go above and beyond the limits put in place by the Environmental Protection Agency.
Trucking industry leaders have called those measures “unachievable,” adding the technology for zero tailpipe emissions in truck transportation “does not yet exist,” and chided EPA – the country’s air quality regulator – for “handing over the keys” to a single state.
Joining Jason and Matt this week on the 10-44 is John Boesel, CEO and President of CALSTART – a nonprofit organization dedicated to developing clean, efficient solutions within the transportation sector – who says California’s need for a different, more stringent, standard is driven by the sheer volume of transport that happens in the state, and that its regulations will likely be a non-issue for most fleets.
Jason Cannon
This week's 10-44 is brought to you by Chevron Delo 600 ADF Ultra Low Ash Diesel Engine Oil. It's time to kick some ash.
California's emissions regulations are some of the tightest in the world, and what does that mean for trucking in the Golden State? This week we take a look.
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Hey everybody, welcome back. I'm Jason Cannon and my co-host as always on the other side is Matt Cole. The Environmental Protection Agency in December passed its latest round of emission control regulations targeting the model year 2027.
While those regulations tighten tailpipe NOx emission limits to about 80% below the current standard and reduced particulate matter by about 50%, California is poised to take those emissions limits at the state level even lower.
Now, if California was a country, it would be the fourth-largest economy in the world and with the largest port operation in the US. CALSTART President John Boesel says, "Trucking is the lifeblood of that economy, but the trade off that comes with such a reliance on transportation is the air quality and environmental impact associated with the diesel engine."
John Boesel
Concurrently the trucks are also major source of greenhouse gas emissions that are impacting our climate. And of course, climate change and its impact on California would be significant. We could lose a lot of the snow pack that feeds our agricultural industry and in many other ways in which sea level rise would hurt the coastal economies up and down the state.
So the state also has a separate set of rules urging and requiring that we transition to lower carbon trucks. So that's why the state is pushing hard for an ability to keep its own regulations on the books and be able to push for standards that are tougher than those at the federal level, realizing that we need better truck performance, fewer emissions coming out of trucks here than they may need and say North Dakota or Oklahoma. But in this state it's a priority. We really want to make it happen.
The regulators here do feel like we've got exceptional circumstances, more truck traffic, more people impacted, so we need a stronger standard than would be practical for the feds to adopt.
Matt Cole
California has a lot of air quality regulations, for example, as of next year. Most newly manufactured small off-road engines like leaf blowers or lawnmowers have to be zero emission. And there are some aggressive sales targets for electric or fuel cell heavy trucks in 2024 too, considering that some of these solutions barely even exist right now.
John Boesel
Starting in 2024, the OEMs, the manufacturers of trucks, have to start selling a certain percentage, and I can't remember, but it's a fairly low percentage of all their trucks sold will have to be zero emission. So that means that they're either battery powered or they could be powered by hydrogen and fuel cells.
And then eventually that number gets up to 30% of all new sales by 2030 would have to be zero emission. And right now we're seeing an uptake on the transit bus market, which is included in commercial vehicles. They are up to about 20 or 25% of all new sales are already electric or fuel cell buses.
So in certain segments of that overall picture, some really good progress is already being made. There's a huge amount of trucks that do 200, 250 miles or less per day. That is easily how we get to the 30% by 2030 market mark by targeting that segment of trucks.
Jason Cannon
The concern I hear often from trucking fleets that do business in California and other states is that California's ability to regulate its own emission standards outside of the EPA sets motor carriers up to acquire what we would kind of consider a California spec, so to speak. Because an EPA compliant truck may or may not be California compliant. But John says that's only the case under a very specific set of circumstances, and he tells us what those are after a word from 10-44 sponsor Chevron Lubricants.
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John Boesel
There is a concern right now that the trucks that are bought here in the state of California meet that lower standard, but then most of the trucks that are operating out of state and then come into California are meeting the federal standard, which is weaker, but California doesn't have control over that, so the state doesn't get as much clean air because the federal standard isn't as strong. All these other trucks coming into the state are operating under the federal standard and then the state doesn't get the clean air as fast as it would like to get it.
I think the big challenge for the manufacturers is a lot. The number of the trucks somewhere, I think is in the neighborhood of 40%, particularly of the bigger trucks are sold here in the state. So any trucks sold here would have to meet the California standard.
And then there is another, say half the trucks are operating in the state, but they they're domiciled elsewhere, so then they only have to meet that national standard. So I think, yes, the trucks coming in from out of state are able to operate here, but all the trucks sold in the state would have to meet that California standard.
Matt Cole
We also hear from a lot of fleet operators that emission regulations, whether from the EPA or California, are just a means to mandate going electric. But John says it's not about electrification as a solution, it's about zero emissions, as far as which powertrain gets us there. He says it doesn't matter, although electric clearly has an upper hand.
John Boesel
With the two regulations on the greenhouse gases. That is what the state sees as the ultimate solution and where we need to go. And by electric, the standard is really zero emission. So it could be battery electric or it could be fuel cell hydrogen, and who knows, maybe some new technology, but they really are focused on the output, the zero emission, no tail pipe, and a decarbonized fuel stream.
That is what they're pushing on with the NOx standard that is really based on public health. They are wanting the trucks, the internal combustion engine trucks that are being sold and operated in the state to be cleaner. They're not using that regulation to try to get people to go to zero emission. They're simply trying to make sure that those diesel trucks that are operating are as clean as they can be and helping as much as they can to lower the amount of air pollution in the state.
When you look at what happened going back to the late '90s, up to 2007 and 2010, it's amazing what the EPA did in coordination with carb, but really at the EPA level to really lower emissions from diesel trucks. I mean, we're talking about on the order of 90% cleaner over that period of time. So there was pushback and at times the OEMs were saying it couldn't be done, but they ended up doing it and they got to that 90% cleaner, and that's why we have almost 10 more million people in the state of thriving the economy by cleaner air.
It's not as clean as it needs to be, but it's a lot cleaner. You don't do that without advances in technology and then also the regulations requiring that they be adopted. So there's really a tremendous success story despite a lot of opposition along the way.
Jason Cannon
California is home to a lot of battery electric commercial trucks, either in some kind of pilot program, daily operation and drayage, and a few handfuls of other segments, but in most of those cases, they're in the hands of really big operations. Pepsi, for example. But the vast majority of trucking companies in the state are smaller outfits without those kinds of resources.
John Boesel
Smaller guys are usually buying the used trucks. They're not buying the trucks up front. So that's where there is a great role for the Pepsi's, the Walmart's and others to be out there leading, them being the ones making that investment, buying the trucks, the zero emission trucks, and then eventually they're going to filter in into the used truck market.
I think over the next several years we're going to find that the truckers are super happy with, right now, certainly with battery electric technology, the brakes will last two to three times as long. There are no fluids to replace, no filters. Maintenance costs go way down. I mean, the people who are driving electric cars now are saying, "What do you replace, your tires?" And you got to put in new fluid to wash your windshield? That's about it. So if I'm a fleet operator, I'm going, "Wow, that's a huge savings."
And then you look at the cost of electricity versus diesel. If you're able to charge at the right time of day, which is usually at nighttime, and a lot of truckers are able to do that, you get a really low cost of electricity, which is probably a third of the price of diesel.
So when you start looking at the total fleet economics, that picture is pretty positive. And right now too, we have this, the state of California has incentives that help in that process to bring down that initial purchase price. And I think it's going to be really exciting in that when fleets start getting their hands on and really understand how these trucks perform and the savings, the operating cost savings, and the fact that the trucks don't have to spend time at the mechanics, they're uptime is better. I think they're going to be really actually be pleasantly surprised.
But what's really exciting is that outside of California, many other states have much cheaper electricity than we do in California. It could be half the price of what we're paying in California.
So when I talk to some of the OEMs, they're going, well, the business case for electric trucks is going to be a lot better, and in some of the other states where the electricity is much cheaper. So I'm actually getting quite excited about the economics for electric trucks in the midwest and even in the southeast.
Matt Cole
California has become kind of the butt of the joke when it comes to the electric grid. Here's this state that struggles keeping the lights on when everybody switches on the AC during the summer. But John says, the reality is those instances are isolated and rare, and he foresees a role for a trucking industry staple to support state-based infrastructure, the truck stop.
John Boesel
I think for truck stops along some of our major interstates, we're talking to some developers that are very excited about the ability to generate their power on site. That there's space around those truck stops to put in significant quantities with solar power, be able to use that power, store that power during the day to be charge trucks at nighttime.
Jason Cannon
That's it for this week's 10-44. You can read more on ccjdigital.com. While you're there, sign up for our newsletter and stay up to date on the latest in trucking industry news and trends. If you have any questions or feedback, please let us know in the comments below. Don't forget to subscribe and hit the bell for notifications so you can catch us again next week.
