
Trucking stakeholders in New York want to delay implementation of Advanced Clean Trucks, which is set to go into effect in January. They’ve claimed that starting the initiative then will devastate the industry.
Truck dealers fear it will decimate their businesses. Truck drivers are worried about the price of diesel trucks skyrocketing. States that have not adopted the rule are claiming it is unconstitutional. For those directly affected, Advanced Clean Trucks is too much too soon.
The new regulation requires manufacturers to sell increasing percentages of zero-direct-emission trucks through model year 2035.
ZEV Sales Percentages | |||
Vehicle Model Year (MY) | Class 2b-3 | Class 4-8 | Class 7-8 Tractors |
2025 | 7% | 11% | 7% |
2026 | 10% | 13% | 10% |
2027 | 15% | 20% | 15% |
2028 | 20% | 30% | 20% |
2029 | 25% | 40% | 25% |
2030 | 30% | 50% | 30% |
2031 | 35% | 55% | 35% |
2032 | 40% | 60% | 40% |
2033 | 45% | 65% | 40% |
2034 | 50% | 70% | 40% |
2035 and future years | 55% | 75% | 40% |
Manufacturers can purchase credits from other manufacturers that exceed sales requirements. They also can sell more zero-emission trucks in one category while selling less in another. However, that flexibility does not apply to Class 7-8 tractors.
This flexibility exemption for Class 7-8 tractors is causing truck dealers in New York to worry about their survival. Although zero-emission trucks are economically feasible for Class 2b-6 truck operations, trucking companies have no incentive to purchase Class 7-8 tractors.
Vestal, N.Y.-based Burr Truck is already feeling the unintended consequences of Advanced Clean Trucks.
That’s because manufacturers are requiring dealers to sell a certain number of electric trucks before they can purchase diesel trucks.
According to Mark Stone, director of sales at Burr Truck, Volvo has a sales policy requiring dealers to sell one battery-electric truck before they can order or sell 13 diesel trucks. How’s that going?
“We sold one battery-electric vehicle last year, which gave us emission credits for 13 diesel trucks next year,” Stone said.
Advanced Clean Trucks has yet to officially begin, and Burr Truck has already lost 200 orders for diesel trucks. Simply put, nobody wants Class 7-8 electric trucks. Consequently, nobody can buy the diesel trucks they do want.
It’s the trickle-down effect of Advanced Clean Trucks. The new rules apply only to manufacturers, requiring them to sell zero-emission trucks as an increasing percentage of their annual sales. With zero demand for Class 7-8 zero-emission trucks, manufacturers are being forced to reduce diesel truck sales to hit that target. With fewer diesel trucks on the dealer lot, New York trucking companies will likely have to buy larger trucks out of state.
Burr Truck is expecting an annual loss of $18 million in sales and about another $4.5 million in parts and services. For many dealers, Advanced Clean Trucks could end their businesses.
Rigid flexibility
Advanced Clean Trucks offers manufacturers several ways to make up for a lack of zero-emission truck sales, but those provisions appear to do very little for Class 7-8 tractors.
The new rule is based on a credit and deficit system. A manufacturer receives a deficit for each truck sold in the state and a credit for each zero-emission truck sold. Compliance is met when credits match or exceed deficits.
For some flexibility, credits can be mixed and matched. Manufacturers can sell more zero-emission trucks in one category while selling less in another. For example, Volvo Trucks could sell more zero-emission Class 3 trucks than needed to make up for a lack of Class 6 zero-emission truck sales.
This is a perfect solution to the issue of technological and economic limitations of larger zero-emission trucks. High demand for Class 3 electric delivery vans could offset weak demand for Class 6 electric trucks. However, there is one glaring problem.
Volvo Trucks does not offer smaller zero-emission trucks. Even if it did, Class 7-8 tractors are exempt from the cross-category credit transfers. Flexibility offered to Class 2b-6 trucks is not given to the trucks that need it the most. According to Stone, Class 7-8 electric trucks make up less than 2% of total sales in California, where Advanced Clean Trucks originated.
Manufacturers are allowed to trade credits. If Daimler Truck sold more Class 7-8 electric trucks than needed, it could sell those credits to Volvo Trucks if it is falling short. However, that system is useless if no manufacturer can hit the target.
Why are Class 7-8 trucks exempt from Advanced Clean Trucks’ cross-category credit trade? Nobody seems to know.
“We’ve asked that question multiple times,” Stone said. “I brought it up to the (California Air Resources Board) meeting a week ago, and I couldn’t get a straight answer. No one can explain it. No one’s ever been able to show us on paper how those zero-emission vehicles credits or deficits actually work.”
Originally, Advanced Clean Trucks required manufacturers to make up a deficit by the end of the next model year. For example, if a manufacturer cannot hit its model year Class 7-8 sales target, model year 2026 credits must offset that deficit. A new amendment to the rule allows a three-year make-up period.
That extension may not be enough. Kendra Hems, president of the Trucking Association of New York, told Land Line that the three-year make-up extension does not change the fact that there is no market for Class 7-8 electric trucks.
“We do not feel that it will provide any relief in New York, as manufacturers will continue to accrue deficits during that period if they sell a diesel truck,” Hems said. “Given the current lack of supporting infrastructure in New York (as well as nationwide), they will not sell enough class 7/8 zero-emission vehicles during that same time frame to cover the deficits. Because of this, manufacturers will continue to limit the availability of diesel trucks in New York to avoid accruing the deficits.”
Recently, governors of nine states that have adopted Advanced Clean Trucks issued a letter to truck manufacturers urging them to take advantage of the flexibilities. The letter comes amid reports of manufacturers “placing blanket purchase requirements onto dealers rather than utilizing the flexibilities built into” the regulation.
When asked about Advanced Clean Trucks’ credit/deficit flexibilities, Daimler Truck could not “provide further details.” Volvo Trucks did not respond to multiple requests.
New York is not California
While California is claiming early success of Advanced Clean Trucks, trucking stakeholders in New York are quick to point out that the landscape is different in the Empire State.
A major part of the weak demand for electric trucks is the lack of a charging infrastructure. In California, there are more than 200 public charging ports for Class 7-8 trucks, according to the U.S. Department of Energy’s Alternative Fuels Data Center. In New York, there are only four.
Chuck Burr, president of Burr Truck, pointed out that after New York spent $400 million in infrastructure upgrades across the thruway, not one charging station was built on the truck side of rest areas.
Then there is the issue of money. Although New York has a few incentive programs for fleet owners, they pale in comparison to what’s offered in California, the world’s fifth-largest economy. Just a few days ago, CARB approved another $35 million in zero-emission truck and equipment incentives.
California also has the pending Advanced Clean Fleets rule, which requires larger fleets to purchase zero-emission trucks. Forcing fleets to buy electric trucks will help manufacturers meet their Advanced Clean Trucks requirements. But no other state has adopted Advanced Clean Fleets rules, so New York cannot reap those benefits either.
The trucking industry in Washington state, also set to roll out Advanced Clean Trucks next year, is having a similar problem. In August, the Washington Trucking Association urged the state government to pull the plug on the rule. The association argued the state is not equipped to handle the new regulations in the same way as California.
Time to hit the pause button
With New York putting the cart before the horse, Burr Truck and other stakeholders are asking the state for a two-year delay in implementation of Advanced Clean Trucks.
In October, the Trucking Association of New York held a webinar stating its case to delay Advanced Clean Trucks. Stakeholders are asking for more time to develop rules that make more sense for New York, including a plan to build out necessary infrastructure.
New York has already carved out exceptions for itself. In October, the state Department of Environmental Conservation exempted snowplowing and street cleaning trucks from Advanced Clean Trucks enforcement after local and state government agencies complained about not being able to buy new equipment due to limited diesel truck supply.
Burr Truck fought to get the same discretion. However, the state told him a broad two-year delay may not be legal despite giving certain government fleets exemptions.
An Advanced Clean Trucks delay is being backed by lawmakers. Senate bill S9910 would prohibit enforcement of the rule until the availability of charging infrastructure and the cost and availability of zero-emission medium-duty and heavy-duty vehicles make the sale of such vehicles more practicable. On Oct. 9, more than a dozen state senators urged the governor to get the bill passed. On Nov. 6, dozens of business organizations sent a similar letter to Gov. Kathy Hochul.
Stone said that most of the issues are based on how the rules apply to Class 7-8 tractors. Tailoring rules to that reality could solve most of the problems. Trucking industry stakeholders believe their input could expedite achievement of Advanced Clean Trucks’ goals, but they have been left out of the conversation.
Click here to urge New York state lawmakers to delay Advanced Clean Trucks.
Legal challenges
While stakeholders are trying to delay Advanced Clean Trucks in New York, they are also trying to stop it completely in the courtroom.
Last June, 19 states sued the U.S. Environmental Protection Agency, arguing Advanced Clean Trucks violates the Clean Air Act. The Owner-Operator Independent Drivers Association later signed onto that lawsuit. Several months later, the U.S. Chamber of Commerce and several more trucking associations also joined the legal challenge. The lawsuit is still pending in the U.S. Court of Appeals for the District of Columbia Circuit.
More recently, the state of Nebraska filed a lawsuit against truck manufacturers, arguing they are colluding with each other to force the adoption of electric trucks. To mitigate the controversy around CARB’s truck emission rules, the agency struck a deal with truck manufacturers called the Clean Truck Partnership. One of the provisions includes truck manufacturers committing to meet CARB’s zero-emission regulations, including Advanced Clean Trucks, even if a court deems them illegal. LL
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