New clean energy rules for large vehicles could have affects on public health and the supply chain

SOURCE: DAIMLER TRUCKS NORTH AMERICA - Clean-energy Daimler freight trucks recharge at Electric Island, a joint Daimler and PGE charging station that opened in April 2021.

Cleaner freight is coming to Oregon.

On Nov. 17, the Oregon Environmental Commission formally adopted the Advanced Clean Truck Rule (ACT) along with the Heavy-Duty Omnibus Rule (Low-NOx).

These rules were presented by the Department of Environmental Quality with the intention to put more electric trucks on the road, replacing diesel and fossil fuel-run vehicles such as school buses, delivery vans, dump trucks, semis, and freight trucks.

This comes after Oregon, D.C., and 14 other states set a goal to adopt 100% electric truck and bus sales by 2050. First created and adopted in California, Oregon is the second state to jump on the clean-truck trend. Five other states including New York, New Jersey, Massachusetts, Washington, and Maine have the ACT rule on the table, as well.

According to the Federal Highway Administration, these seven states contribute more than 20% of the nation's medium- and heavy-duty trucks.

The new rules apply to medium- and heavy-duty vehicles including vans, buses, and trucks. The ACT rule requires truck manufacturers to start offering more new sales of zero-emission vehicles at increasing percentages, while the Low-NOx rule requires reduced dangerous air pollution from new fossil fuel-powered engines.

Both rules take effect with the 2025 model year, giving fleet owners the opportunity to upgrade to cleaner models over time.

"We're proud to stand alongside many other community and environmental groups in celebrating … adopting both of these rules. Transitioning to cleaner sustainable fuels and reducing pollution from those fossil fuel powered vehicles that remain in the market is an important step. It moves us closer to our climate goals and improves the health of communities all across the state," said Diana Nuñez, executive director of the Oregon Environmental Council, in a press release.

According to data from the Oregon DEQ, diesel engine exhaust causes an estimated 176 premature deaths and $3.5 billion in costs from exposure, every year in Oregon. This has an economical effect seen in medical bills and sick days missing work and school.

A benefits analysis conducted independently by MJ Bradley & Associates projects a $21.2 billion net in societal benefits, and 84,000 respiratory illnesses avoided, by 2050 with these two rules being enacted.

The new rules are intended to reduce greenhouse gas emissions, smog-forming nitrogen, and particulate matter from large vehicles by 223,300 cumulative tons by 2050, according to the analysis.

"It has been almost 14 years since the Oregon Legislature directed state regulators to reduce diesel particulate pollution so that it would bring cancer risk below the EPA acceptable risk level in the state," said Mary Peveto, executive director of Neighbors for Clean Air, in a press release. "Adopting the strongest standards for new trucks in our state is a significant step in the right direction for finally eradicating this environmental and public health injustice."

Rick Mihelic, originally from Oregon, is the director of emerging technologies for the North American Council for Freight Efficiency, a nonprofit with the mission to keep businesses with fleets informed on technology in an unbiased way. Mihelic told the Business Tribune the new rule's adoption was expected by the trucking industry.

"It's good they progressed beyond making a promise to actually putting regulations in place," Mihelic said. "The industry was already migrating to zero-emission vehicles."

Mihelic said electric vehicles tend to cost more up front in terms of list prices, but there are factors that offset the cost and create a positive return on investment for electric vehicles.

For example, the Oregon Department of Environmental Quality has a clean vehicle rebate Program, which can save motorists up to $5,000 on their new qualifying electric vehicle. Oregon also has rebates for utilities, so some people can sign up for rebates for electric vehicle chargers — but these can vary by region.

The federal government offers a Zero Emission Vehicle Incentive Program, which gives rebates for qualified zero-emission vehicles.

"In the end, you're looking at what it would cost to buy it and operate it over time, and within a few years you're going to see a positive return on investment for the company operating those vehicles," Mihelic said. "In (some) situations, there's actually a positive cash flow for operating the vehicle.

But there could still be growing pains with the transition to clean energy freight.

As electric vehicles are supported in these ways, more of them are encouraged to come on the market. However, there is already a chip shortage for new electric vehicles that could be in even greater danger of bottlenecking with the supply chain issues.

"Today you've got a challenge in the automotive and transportation world: companies can't get all the components that they need to build their vehicles because their supply chain is pretty messed up right now — those computer components are the ones probably at the greatest premium," Mihelic said. "So within the next year, that's probably still going to be a challenge. After the supply chains get back to being healthy, it shouldn't be an issue to get those types on components for zero emission vehicles."

If big freight companies like Amazon jump on the trend and transition its fleet to electric, it could ease the pinch as Oregon makes the transition under the new rules.

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