CARB – New Diesel Regs Cost Effective, Lobbyists Wrong

The California Air Resources Board today released its analysis of cost estimates for lengthened warranties required under the new Heavy-Duty Low NOx Omnibus Regulation, went into effect at the end of 2021 and is a key part of California’s Mobile Source Strategy for improving public health by reducing air pollution from the transport sector. The purpose of longer warranty periods for emission control-related equipment on heavy duty trucks is to ensure they perform as intended for the hundreds of thousands of miles trucks are typically driven. The new report looks at emissions reduction equipment used in 2024 model year and later heavy-duty vehicle engines. (read AutoInformed.com on Death of the Diesel – CARB Approves Truck, Bus Smog Checks; CARB OK’s Record $1.5B for Clean Vehicles, Mobility Options)

The report is in direct response to board direction to staff given when the board approved the regulation in August 2020. CARB* staff’s original warranty cost estimates were challenged by the Engine Manufacturers Association, and the board directed staff to form a working group to review their estimates in comparison to industry estimates. The group met more than 16 times over nine months. Based on the working group process and documentation in the report, CARB staff concluded no substantial changes to its original estimates are required.

A key part of the report AutoInformed thinks is when CARB staff compared 2022 model year warranty cost estimates made by CARB and manufacturers that reflect the intermediate impact of lengthening warranty periods. The report finds that, on a “per miles covered” basis, the industry data essentially agrees with CARB’s lower estimates for current model year vehicles.

Ken Zino of AutoInformed.com on CARB - New Diesel Regs Cost Effective, Diesel Industry Lobbyists Wrong

Click to Enlarge. EMA – Truck and Engine Manufacturers Association, ACT – Research Americas Commercial Transportation Research Co., NREL – National Renewable Energy Laboratory.

Other conclusions in the report include:

  • Staff disagrees with industry assertions that costs of poor design for new technology should be considered warranty costs; warranty is intended to help ensure defects in materials and workmanship are repaired but is not meant to protect manufacturers from having to design durable components. Moreover, most of the equipment involved uses technology that is already on the market.
  • Industry contends new technology design means large additional cost assuming higher failure rates of new technology and additional warranty costs to cover failures of new technologies. Staff on the other hand concluded new technology costs are part of engineering design costs and not warranty costs. The analysis shows that even if warranty costs of new technology were included, its recommendations would be the same, and any additional cost would be far below industry estimates.
  • A staff survey of owner-operators also indicates that the extended warranties will likely increase the resale value of compliant vehicles due to remaining miles of warranty coverage. For example, A remaining two years or 200,000 miles of warranty coverage can increase resale an average of $2,000.

Executive Summary: the regulation is cost-effective, returning an estimated $23.4 billion in benefits compared to about $2.39 billion in costs. This includes 2,480 lives saved and 2,010 avoided hospitalizations over the life of the regulation from decreased diesel emissions.1

“This regulation will have a direct public health benefit in California’s environmentally overburdened communities, which are often surrounded by major highways and transport facilities. The regulation will reduce oxides of nitrogen (NOx, which is a basic component of smog) from heavy-duty trucks and engines by 17 tons a day statewide when fully in force by 2031. That is equivalent to removing 12 million light-duty vehicles from the road for a year,” CARB said.

The new rule will be phased in, allowing engine manufacturers time to prepare for compliance. The NOx standards that engines must meet will be cut to approximately 75% below current standards beginning in 2024, and 90 percent below current standards in 2027.

*CARB is the lead agency for California’s fight against climate change,
and oversees all air pollution control efforts in the state to attain and
maintain health-based air quality standards. More Information  

List of Acronyms and Abbreviations in Report

  • ACT Research Americas Commercial Transportation Research Co., LLC
  • ATA American Trucking Associations
  • CARB or Board California Air Resources Board
  • CBI Confidential Business Information
  • CDA Cylinder Deactivation
  • CE-CERT The Bourns College of Engineering, Center for
  • Environmental Research & Technology
  • CI Confidence Intervals
  • CSUS California State University, Sacramento
  • DEF Diesel Exhaust Fluid
  • DOC Diesel Oxidation Catalyst
  • DPF Diesel Particulate Filter
  • ECM Engine Control Module
  • ECU Engine Control Unit
  • EGR Exhaust Gas Recirculation
  • EMA Truck and Engine Manufacturers Association
  • EMFAC CARB’s EMission FACtor model
  • ERCs Emission-Related Components
  • ERG Eastern Research Group, Inc
  • EWIR Emissions Warranty Information and Reporting
  • FET Federal Excise Tax
  • FIR Field Information Report
  • FTP Federal Test Procedure
  • g/bhp-hr Grams per Brake Horsepower-Hour
  • g/hr Grams per Hour
  • GVWR Gross Vehicle Weight Rating
  • HD I/M Heavy-Duty Vehicle Inspection and Maintenance
  • HD OBD Heavy-Duty On-Board Diagnostics
  • HDO Heavy-Duty Otto-Cycle
  • HHDD Heavy Heavy-Duty Diesel Engines >33,000 lbs. GVWR
  • HHDV Heavy Heavy-Duty Vehicles >33,000 lbs. GVWR
  • hr Hours
  • ISOR Initial Statement of Reasons
    ISR Sacramento Institute for Social Research
    lbs. Pounds
  • L Liter
  • LHDD Light Heavy Duty Diesel
  • LLC Low load cycle
  • MECA Manufacturers of Emission Controls Association
  • MEMA Motor & Equipment Manufacturers Association
  • MHDD Medium Heavy Duty Diesel
  • MSCD Mobile Source Control Division
  • mi Miles
  • MIL Malfunction Indicator Light
  • MY Model Year
  • NOx Oxides of Nitrogen
  • NREL National Renewable Energy Laboratory
  • OBD On-Board Diagnostics
  • OEM Original Equipment Manufacturer
  • PM Particulate Matter
  • R&D Research and Development
  • RMC Ramped Modal Cycle
  • SCR Selective Catalytic Reduction
  • SwRI Southwest Research Institute
  • TRUCRS CARB’s Truck and Bus Regulation Reporting
  • U.S. EPA United States Environmental Protection Agency
  • US10 ERCs ERCs meeting the current federal requirements
  • UL Useful Life
  • yr Year
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