05 Jun 2002 EPA Ruling Backfires, Spurs Sales of Diesel Trucks, by Gretchen Randall

BACKGROUND: The Wall Street Journal (1) reported recently that long-haul truck sales have skyrocketed primarily as trucking firms buy new rigs before new anti-pollution rules for diesel engines take effect October 1, 2002. The added cost of the new less polluting engines is estimated to be between $3000 and $5000. In addition, the engines are reported to be less fuel efficient, more costly to maintain and possibly more prone to breakdowns while in use.

TEN SECOND RESPONSE: Here’s another example of how over-reaching regulation can backfire and have just the opposite effect it intended.

THIRTY SECOND RESPONSE: By trying to impose mandatory changes in diesel engines as of October, EPA pushed the trucking industry to buy trucks before the new rule goes into effect, thus thwarting its intentions. These trucks will stay on the roads for several years before being replaced. Whereas if the market were allowed to work unfettered, consumer demand for cleaner diesel engines would have accomplished the same thing.

DISCUSSION: Manufacturers of the diesel engines have reportedly told EPA that they may not be able to produce reliable new engines as required as of October 1, 2002. However, EPA has not yet granted an extension of the timetable and is recommending fines of up to $15,000 per engine sold after Oct. 1 that don’t meet the new standard. The new standard set in 1998 would reduce the nitrogen oxide (NOX) emissions from diesel engines by about one-third by 2008, according to EPA. NOX emissions are thought to be one of the major contributors to smog.