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Big Rig Standards Could Cut Freight Costs 7%

EDFIf bold enough, incoming fuel-efficiency and greenhouse gas standards for heavy-duty trucks being devised by the EPA and the NHTSA could reduce the cost of moving freight by 7 percent and owners of tractor-trailer units could save $0.21 per mile, according to a report from Environmental Defense Fund and Ceres.

The EPA and NHTSA adopted the first-ever standards for medium- and heavy-duty vehicles and engines built for model years 2014 to 2018 — the so-called phase 1 standards — in 2011. President Obama pledged to set new emissions rules for trucks in his state of the union address earlier this year. The agencies are currently working on a second phase of standards for trucks beginning with model year 2019. The phase 2 standards are expected later this year.

Fuel is the single largest cost of owning and operating a heavy-truck, accounting for 39 percent of total costs. Strong fuel efficiency standards will target these costs largely by requiring the use of cost-effective, fuel saving technologies. Fuel savings will be significantly greater than increases in equipment costs, according to the analysis in EPA/NHTSA Phase 2 Fuel Efficiency and Greenhouse Gas Standards for Heavy-Duty Trucks: Projected Effect on Freight Costs.

A $0.21 per mile savings, for example, has an annual savings potential in excess of $25 billion given that class 8 trucks in the US logged 120 billion miles in 2013, the report says.

In order to realize gains of this magnitude, large corporate consumers of trucking services need to join the call for bold, truck efficiency and greenhouse gas standards, EDF says. Companies can do this is by issuing public statements of support for a truck efficiency stringency target of 40 percent over 2010 by 2025.

According to a fact sheet by American Council for an Energy-Efficient Economy and four other groups that was released last week, the standards could achieve a reduction in average new truck fuel consumption of at least 40 percent by 2025 from 2010 levels. The fuel reduction would yield oil savings of 1.4 million barrels of oil per day in 2035, and two million barrels per day in 2040, it says.

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2 thoughts on “Big Rig Standards Could Cut Freight Costs 7%

  1. The government ordering somebody to do something does NOT save money. The manufacturers are not stupid. They are competing with each other for competitive advantages in the market place. Each of them is working to best their competitors, without another government program.

  2. Actually Rich, in many cases government mandates do save energy. Have a look at these examples from CA (from another article in today’s Environmental Leader newsletter):
    1) “The state’s efficiency standards, largely aimed at buildings and appliances, have saved Californians $74 billion and avoided the construction of more than 30 power plants.”
    2) “Those energy savings have, in turn, translated into residential electricity bills that are now 25 percent lower than the national average.”
    3) “California produces twice as much economic output per kilowatt hour of electricity usage as the national average.”
    Other examples of positive outcomes from government mandates – both state and federal – abound. For example, Clean Air and Clean Water rules that have saved significant money by avoiding negative health outcomes from air and water pollution.
    And with respect to manufacturers doing things on their own to be competitive: that just doesn’t work. After all, improving efficiency is an idea that has been around for decades – and in all that time, companies have roundly ignored it as a way to improve competitiveness. History just doesn’t back up your argument that mere competition in the private sector is a guarantee of desirable social outcomes.

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