Both in his State of the Union Address and at a speech in which he gave in Upper Marlboro, Md., the President has called for higher fuel economy standards for heavy duty and medium duty trucks. This initiative will work in parallel with the cause to reduce harmful vehicle emissions which have a negative impact on air quality, which are already in place. The President will push for the tougher standards by 2016. Both the EPA and the DOT are leading this initiative and will be developing and issuing a Notice for Proposed Rulemaking on this subject matter, with more stringent policy to be drafted by 2016 and instituted between 2014 and 2018.
The proposed plan discusses the implementation of innovation and the wider spread use of “green fuels” such as natural gas. Included in the conversation are industry leaders such as the engine manufacturers, fortune 500 fleet operators, and representatives of the regulators themselves. But what about the opinions of the many who make up the lower rungs which consist of many big rig owner-operators, family owned transportation and shipping providers, and smaller commercial fleet owners? And what kind of “innovation” will be accepted as a part of this ongoing agenda? Will grass roots innovation be considered, or will the market be dictated to again by a group of over-zealous regulatory actions?
We have seen what happened with the Stop the Soot program, part of the National Diesel Retrofit Program, and by enforcement actions lead by CARB in recent regulatory enforcement action; that has forced many owner-operators and smaller fleets to call it a day, just to throw in the towel and close down their operations. The main complaint of many (as we interviewed fleet owners in our War on Trucking Series) is that they are forced to adopt one technology or purchase a new truck, which falls outside their scope of their budget; or face big penalties and fines. For most the cost to keep up with regulatory burdens are just too much to bear, forcing them off the road and to look for work and opportunity elsewhere.
So the question becomes, “Will the DOT and EPA finally consider the freedom for the smaller fleet operator to adopt innovation they feel is the best fit for their needs and that will work for their budget, or will this initiative be another blow to the already fragile landscape that makes up the fight between owner-operators and large national carriers?” The Notice for Proposed Rulemaking will allow for public commentary to be considered, which usually is issued threw a Request for Information followed by a series of public hearings. Fleet organizations, technology providers, and owner-operators themselves have been calling for a higher level of transparency when it comes to such proposals, making it easier for the public to offer their ideas and suggestions to be heard. Usually RFI’s or RFP’s are usually buried deep in government agency websites, and most hearings are not conducted in an area where the public can easily access them.
Smaller fleets and owner-operators have suggested for multiple meetings to be held in areas where statistics will demonstrate a high rate of truck traffic flow, so they have the ability to attend such hearings without giving up their ability to continue to still make a living. Having the freedom to make a consumer choice is still an ongoing concern for many who have researched their own solutions to meeting these standards. Many fleets across the nation have beta tested products and practices, with positive results only to be told that they cannot use these innovations because they are not on “the list.” “The List” refers to the approved list of products the EPA has deemed as the standard and will be the products in which receive grant funding, that are aligned with federal grant funding and have been through tens of millions of dollars in third party testing approved and funded by the EPA.
This practice has completely shunned out any new available innovation that could be considered as a possible solution to fuel economy and emissions reduction enforcement action. These practices are contradict the actual initiative, and many claim to be a program that continues to help large fleets and manufacturers grow while forcing out the competition of start-up innovation and owner-operator fleets from the market place. In a tough fragile economy, it would be the “win-win-win” to allow for start-up innovation, owner-operators and smaller fleet operations, to have the ability to partner up and go toe to toe with the big boys in the room. Such free market competition will spur action for best and most cost effective innovation to prevail, or even a number of technologies to be a better consideration than what are currently offered on “the list.” Having the free market to provide innovation versus the private-public partnership model, will allow for the consumer and for the tax payer to determine what is the best answer to the situation, since they are the ones at the end of the day who pay the price for these of types of policies that are created. This type of resolve would also lessen the need for regulatory enforcement action which levies heavily against smaller fleet operators, since they usually don’t have the resources to comply.
The best part about the consideration for other innovation: jobs. Someone has to make the product. What a better place but to make that product here in the United States, where the product will be demanded by the market. With innovation kept under the thumb of a chosen winner’s and loser’s list, we are putting a lid on much anticipated job creation. Smaller firms who offer innovation and technology usually produce their product not far from their founding roots of their home community. The usually also provide a technical service model that accompanies their product, which assures local service jobs to take hold. Most products found on “the list” do not utilize this model and are manufactured abroad. They are usually only offered through established distribution channels in areas that already have an existing employment base. This provides for no new job creation.
The “win-win-win” is for new innovation and technology to be considered in this next round of regulatory initiatives; fleets will have a wider scope of available options to become compliant; more older trucks are retrofitted with something better than nothing solution; owner-operators and smaller fleets can stay in business; fuel economy and environmental goals would be met; the price of innovation will drop; and jobs will be saved and created in the process. That is a big win for the tax payer who is already burdened with the cost of running programs which are sponsored by DOT and the EPA.
And one last dynamic that needs to be considered…how will tax reform affect some of these initiatives? Usually most of the funding for “green fleet” projects have always come from grants and project money that was released and allocated by regulatory agencies. Within the proposed Tax Reform Bill, proposed by Chairman David Camp, of the Ways and Means Committee, House of Representatives, released yesterday a working draft of Comprehensive Tax Code Reform; references terms and content that provide “green fleet” tax credits. Content aimed to provide incentive to early adopters of innovation and provide research and development credits for smaller innovators was proposed to both the Ways and Means in the House and the Senate Finance Committee by working groups, constituents, and industry advocates. Will this finally open the log jam or just further the debate between the people and their representatives and/or regulatory agencies and the White House on this subject matter.
Regardless of what side of the debate you are on, there is no denying that all of these actions, initiatives, and policies affect us every time we go to the grocery store to purchase our family’s needs. Everything in the store was delivered by a truck, and this is reflected as a part of the prices on the shelf, and these are costs that you pay when check out an item at the register. You as the consumer and as a taxpayer will have to decide how much are you willing to pay.
You can find more about the White House’s Plan on this subject matter by clicking the link:
You can also chime in on the conversation by visiting a discussion and commentary at: http://www.blogtalkradio.com/truthabouttrucking/2014/02/27/open-forum-increase-fuel-efficiency-standards-nprm
Until next time…we live life in The Green Lane…one mile at a time.
-Samuel K. Burlum