EGR Proponents to Use Credits to Meet 2010 Engine Standards

This story appears in the June 30 print edition of Transport Topics.

The two major engine makers that will employ exhaust gas recirculation technology to meet the tightened federal emissions rules that go into effect in 2010 will use credits they have earned from the Environmental Protection Agency to hit the new mark.

Cummins Inc. and Navistar Inc. have both said they will use EGR for their heavy-duty engines in 2010. But executives with the two manufacturers said separately that the averaging or banking of credits — a process allowed by EPA since 1990 — will probably be the key for reaching the last margin of improvement for lowering emissions of nitrogen oxides to 0.2 gram per brake horsepower-hour by January 2010 (see story, p. 31).

In contrast, the North American operating companies of Daimler Trucks, Volvo AB and Paccar Inc. have all come out for selective catalytic reduction technology in their engines, which they also said will meet the new standards “at the tailpipe” and also improve fuel economy. As a result, they said, they will not use credits as part of the 2010 compliance process.

Caterpillar Inc. said June 12 it will not manufacture any 2010-compliant power plants for the U.S. truck market (6-16, p. 1).

“We are not unique in using credits. Every engine we sell will be fully compliant with EPA regulations, and credits are a part of the regulations,” Jeff Jones, a Cummins engine division vice president, said in an interview.

Daniel Ustian, Navistar’s chairman and chief executive officer, told stock analysts in a May 28 conference call that his company is “developing a final answer” on the use of credits, which could be affected by whether its proposal to buy the medium-duty truck business of General Motors Corp. is finalized.

Asked for clarification, Navistar spokesman Roy Wiley said the company has “a lot of credits, and we can use them if needed,” and that they would play a role in planning for 2010. Neither Wiley nor Cummins’ spokeswoman would reveal which engine lines are generating credits and for how long the 2010 models would be using credits.

However, Dee Kapur, president of Navistar’s truck group, told Transport Topics during a recent tour of the OEM’s factory in Mexico that the manufacturer expects to use the credits into 2012, approximately, and would probably update its engines after that.

Cummins produces engines for truck makers throughout the medium- and heavy-duty spectrum. Navistar is new to the heavy-duty sector with its MaxxForce line, but has long been a major medium-duty engine maker.

Spokesmen for Volvo Trucks North America and its sister company Mack Trucks; Daimler’s Detroit Diesel Corp. unit; and Paccar Inc., the owner of Kenworth Trucks and Peterbilt Motors, all said emission credits would not be part of their preparations for the 2010 engines.

“We have no plans to use credits to comply with the regulation. We will not use anything other than meeting the target at the tailpipe,” said David Siler, Detroit Diesel’s marketing director. He added that the switch to SCR from December 2009 to January 2010 should improve fuel economy on the company’s DD15 heavy-duty flagship product by about 3%.

Siler said the Daimler/DDC decision to push aside the credits program in this instance is something of a badge of honor.

“This is a perfect opportunity for us to exhibit our leadership on environmental issues and separate ourselves from the pack on clean engines.

“We’re not interested in programs that compromise the ultimate goals of the EPA. This is most urgent environmentally,” Siler said.

Spokesmen for Volvo and Mack, James McNamara and John Walsh, respectively, said their companies’ engines should post fuel economy improvements of 2% to 3% and also will not need credits.

Byron Bunker, director of EPA’s Heavy-Duty On-Road Center, said that while the agency  already has begun discussions with OEMs about their plans for 2010, he does not expect to see formal submissions for certification until the middle of next year, and that the review process typically takes about 90 days.

Particulate matter standards for diesel engines dropped to 0.01 gram per unit of output in 2007 and will stay at that level in 2010. However, NOx standards are still moving, having dropped to 2.5 grams from 4 grams in 2002 and proceeding to 0.2 gram in 2010. In 2007 the nature of the standard shifted, temporarily, to a sliding average of about 1.2 g/bhp-hr.

Bunker said the absolute standard for 2010 will really be 0.5 gram. The maximum usage for credits is to bridge the gap between there and 0.2 grams. That means a 2007-generation engine emitting roughly 1.2 grams of NOx per unit of output could not be submitted for consideration in 2010, no matter how many credits an OEM had.

The coming choice between EGR and SCR Class 8 engines has led to what is probably the most hotly contested argument in trucking equipment, with the highest-ranking executives on both sides taking passionate, public stands to back their technology choices.

Ustian told stock analysts during the same conference call that SCR is the “easiest” solution for solving the 2010 regulatory challenge, “but it is not the best way.” He said his EGR MaxxForce line offers a proven, familiar technology that does not require drivers to hunt for diesel exhaust fluid, or commercial urea, which can freeze in winter if not kept warm.

The SCR proponents, which will include Peterbilt and Kenworth in 2010, have countered by saying their products are in wide circulation in Europe, including its colder climates, and that they expect fuel economy to be a major selling point with diesel around $5 a gallon.