Update: Oregon’s voluntary diesel retrofit program fails to capture industry imagination

July, 2001: As reported on equipmentworld.com, the Oregon Department of Environmental Quality (DEQ), in conjunction with U.S. Environmental Protection Agency and the Oregon Trucking Association, held a conference in Tourtdale, Oregon, to highlight the state’s voluntary diesel retrofit program.

Although Oregon environmental activists noted that upcoming emissions mandates in 2002 continuing through 2010 would create “the cleanest generation of diesel vehicles in the world,” concern remained that diesel engines manufactured before the tightening emissions requirements would continue to pollute Oregon skies and expose residents to increased risks of chronic respiratory problems as well as bladder, liver, blood and lymphatic cancers.

In combat these evils, the DEQ began its Voluntary Retrofit Program, which offered tax credits to owners who installed after-treatment emission control systems on older diesel engines in their fleets. The primary after-treatment system is a catalyzed diesel particulate traps used in combination with low-sulfur diesel fuel. Other alternatives included early engine replacement and engine upgrades. The DEQ estimated that it would cost around $6,300 to retrofit a single diesel engine, but noted that, “prices would drop substantially once the market expanded to approximately 100,000 particulate filters per year.”

Conference attendees were told that order to qualify for the tax credits, businesses would have to be approved by the Oregon Environmental Quality Commission. This would include documenting the pollution control investment, submitting vehicle identification numbers, documentation proving that the retrofit devices used are certified by the EPA under its technology verification program, along with various other information and an application fee. After that criteria was met and the after-treatment systems installed, owners would then be eligible for a tax credit for 50 percent of the total investment in pollution control technology. This credit (which dropped to 35 percent in 2002) could be applied against the company’s tax obligation at year’s end.

Today: Not surprisingly, response to Oregon’s Voluntary Diesel Retrofit Program has been under-whelming to say the least. As of December, 2002, not a single fleet (or vehicle) in the state had completed a voluntary retrofit, although Kevin Downing, air quality planner for DEQ, says that there are several fleets in various stages of discussion and commitment.

“Money has been the issue,” Downing admits. “Diesel emissions are the classic environmental issue. It’s a problem caused by one party that affects others, and the resolution of which requires diesel engine owners to incur some costs for which they get only modest benefits. Most of the benefits are for the public at large. So it’s very hard to make a good business case for retrofitting.”

Certainly, Downing says, the $6,300 cost of bringing older diesel engines into compliance hurt the DEQ’s efforts. “The recession has kind of put people back on their heels,” he adds. “And we’ve had a difficult time convincing fuel companies to introduce low-sulfur diesel into the Oregon market. We need find enough low-sulfur fuel users – who use in the neighborhood of 10,000,000 gallons a year – to convince the petroleum companies to mass-market the fuel.”

Still, Downing says that despite the current lack of enthusiasm, the DEQ remains committed to the retrofit program, and will begin looking at increasing awareness of it among contractors with fleets of off-highway construction equipment.