By Amy Harder and Imani Moise – Wall Street Journal-
WASHINGTON—Major truck manufacturers and operators of large commercial fleets cautiously embraced federal standards released Tuesday requiring cuts in fuel usage of big trucks, one of the last in a long line of regulations President Barack Obama has issued over the past several years seeking to clamp down on greenhouse gas emissions across the U.S. economy.
The Environmental Protection Agency and the Transportation Department jointly announced the final standards for big vehicles ranging from vans to garbage trucks to 18-wheelers that requires up to 25% lower carbon emissions and fuel consumption in certain models over the next decade compared with today.
Marking a departure from the divisive debates over Mr. Obama’s climate agenda, many executives in the trucking industry backed the standards, saying they ultimately help cut down fuel costs across large commercial fleets of trucks.
Some operators of large fleets, such as Waste Management, Inc., are shifting to natural gas, a cleaner burning fuel whose prices have been cheap in recent years, while others see a business opportunity by selling more efficient engines.
“The whole suite of technology to help commercial fleets do their jobs in a positive way provides a lot of pull for Cummins products,” said Brian Mormino, executive director of environmental strategy and compliance at Cummins Inc., one of the largest engine makers in the world for big trucks.
Waste Management and Cummins are among two members of a coalition of major corporations, which also includes PepsiCo Inc., and Wabash National Corp., that have worked with the EPA on the rule and generally backed the agency’s work.
The vehicles covered in the rules comprise just 5% of road traffic but 20% of emissions and fuel use in the transportation sector, according to the EPA.
The sector makes up about 6% of overall U.S. greenhouse-gas emissions.
The regulations, first proposed last summer, include two broad categories for standards: one for the load-pulling tractor unit of large so-called semitrailers and one for the trailer it hauls.
The final standards, which cover the engines and trailers of 18-wheelers and other big hauling trucks over the next decade, as well as buses and vocational vehicles, are sightly more stringent and will result in higher compliance costs than last year’s proposal.
“There will be some escalation in cost, but it is with a long lead time and gradual and very short payback period,” EPA Administrator Gina McCarthy said Tuesday.
By 2027, operators of the trucks covered by the standards can expect to recoup costs between two and four years, depending on the type of vehicle, Ms. McCarthy said.
Those costs vary widely based on the vehicle type, engine or trailer at issue. The cost of the rule for a tractor and trailer combination in 2027 could initially be up to roughly $15,100, about $1,000 more than the proposal, according to the regulatory impact analyses of both the proposal and final standards.
While large companies making engines and managing commercial fleets mostly backed the rules, others representing smaller companies and truck dealerships were more critical.
The Owner-Operator Independent Drivers Association said new and more expensive technology requirements places an unfair burden on smaller truck companies that rely solely on their reputation and can’t wait years to pay off the standards’ cost.
“One truck going down, that is a huge, huge impact,” said Scott Grenerth, regulatory affairs director for the association. He added that in 2014, 49% of all fleets only had one truck. “There is very little room for error in an industry that calculates things down to the penny per mile.”
A spokesman for the American Truck Dealers, a division of the National Automobile Dealers Association that represents 1,800 truck dealerships, said the group was still analyzing the rule but was “concerned with the possibility that compliance will prove too complex or expensive for the market (dealer customers) to accept without disruption.”
The Obama administration announced in 2011 a first set of federal standards for the models of big trucks between 2014 and 2018. The first round of standards stay in effect until 2021, when the round of standards announced Tuesday kick in and last through model year 2027, a White House spokesman said.
Under the final standards, some big trucks that have both the tractor and the trailer will face requirements to be up to 25% more fuel efficient, while other vehicles face less stringent standards. Heavy-duty trucks and vans must be 2.5% more efficient, according to a White House fact sheet. Individual trailers and engines also have specific standards, ranging between 4% and 9% more efficient.
For the past few years in the absence of congressional action, the EPA and other government agencies, including the Interior and Transportation Departments, have issued rules regulating greenhouse gas emissions from large swaths of the U.S. economy, including power plants, oil and natural gas operations and passenger cars.
Congressional Republicans have mostly opposed the rules, and GOP presidential nominee Donald Trump has vowed to repeal many of them, which are also being challenged in courts by state attorney generals and the affected industries. Democratic nominee Hillary Clinton, meanwhile, has vowed to continue and expand Mr. Obama’s climate agenda through more regulations.