VW settlement to help improve Oregon air

The deal includes $2.7 billion for an environmental mitigation fund

Matthias Müller
Volkswagen AG chief executive officer Matthias Müller speaks in Detroit, Sunday, Jan. 10, 2016. In his first US visit since American regulators said VW cheated pollution tests, Mueller apologized over a scandal that plunged the German auto giant into the deepest crisis of its history and could cost billions in fines, recalls and class-action lawsuits. (AP Photo/Paul Sancya)

PORTLAND, Ore. (PORTLAND TRIBUNE) — Diesel engine exhaust is among the biggest killers of all pollutants in Oregon, and the state is in line to get its largest-ever cash infusion to address the problem.

Sometime next month, a federal judge is expected to grant final approval of a mammoth legal settlement with Volkswagen to compensate for the German auto giant’s effort to cheat air emissions testing of its diesel vehicles sold here.

The deal includes $2.7 billion for an environmental mitigation fund, and Oregon is slated to get the biggest chunk of that, on a per-capita basis, of all the states: $68.2 million. That’s because Oregonians — who account for roughly 1 percent of the nation’s population — bought 4.5 percent of the affected diesel vehicles, the highest per-person among the states, says Kevin Downing, who coordinates the Clean Diesel Program of the Oregon Department of Environmental Quality.

The $68.2 million represents a huge advance in Oregon’s campaign to clean up diesel engines. It’s about seven times the total amount DEQ has spent or helped raise for clean-diesel projects over the past 15 years, about two-thirds of which came from the U.S. Environmental Protection Agency.

But it’s far short of what will be needed to cure Oregon’s overall health and environmental threats from diesel engines.

If all the money were used to offer trucking companies a 25 percent subsidy so they could replace old heavy-duty trucks with new clean-diesel models, Downing estimates it could get 2,000 dirty-diesel trucks off the road and replaced. But there are now 62,424 medium and heavy-duty trucks in the state built in 2010 or earlier, when strong clean-diesel requirements went into full effect for manufacturers.

Priorities set by decree

Though Volkswagen’s diesel vehicles were fitted to filter out the most harmful diesel particulates, the cars managed to evade U.S. limits on nitrogen oxide, or NOx emissions, which contributes to ozone and smog, Downing says. The pending court decree lays out guidelines for how the environmental mitigation fund can address both problems.

The decree requires replacing dirty diesel engines instead of subsidizing new exhaust filters, Downing says. Much of the state’s effort over the past 15 years has been helping truckers install exhaust filters to screen out particulate emissions, which is much cheaper than replacing the trucks. But prevailing cleanup strategies have changed, and now the emphasis is on buying replacement trucks or switching out old engines for clean-burning ones.

The draft decree does not provide for subsidizing new construction equipment, Downing says, though off-road diesel equipment also is a big part of the problem.

The decree specifies that government-owned diesel rigs can qualify for full replacements, while privately owned vehicles would qualify for partial reimbursements if matched by the owners. Some of the money could be used to support alternatives to diesel vehicles, such as electric vehicles and charging stations and trucks powered by propane or compressed natural gas.

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Funds from Volkswagen are not expected any time soon. Initial funds are expected over a three-year period, and all the money within 15 years.

When a judge OKs the final court decree, “That’s where the conversation just begins,” says Mary Peveto, president of Neighbors for Clean Air, a Northwest Portland group working on diesel issues.

That’s because it will be up to the Oregon Legislature to decide where to spend all that money during its regular session next year.

Different strategies emerging

Peveto says a top priority for use of the money should be to help school districts get rid of their old diesel school buses. “I think that to me is just a no-brainer,” she says, because schoolchildren are heavily exposed to diesel fumes when they line up for school buses or exit them.

In 2007, the Oregon Legislature required school districts to retrofit their old buses by 2017 or replace them outright by 2025, Peveto says. But a review last year found school districts weren’t finding the money to do the retrofits, and were mostly waiting to replace their buses in 2025, when many of their vehicles will need to be replaced anyway.

“We found out that half of our school buses are still old and dirty,” Peveto says.

Colin Price, who works on diesel policy for the Oregon Environmental Council, agrees that replacing school buses should be a high priority for the money. His group also sees replacing local freight trucks as a high priority, since they tend to be older and dirtier than long-distance trucks and cause much of the problem.

Newer freight trucks, buses and diesel automobiles aren’t a problem, because of congressional mandates several years ago that required newly built vehicles to filter out most of the diesel soot from emissions. A mandate requiring reduced nitrogen oxide emissions kicked in later.

But trucks can last 40 to 50 years, so many dirty-diesel vehicles remain on the highways.

California has taken the most aggressive action among the states to get older, noncompliant diesel vehicles off the road, by gradually banning them. Oregon’s strategy has been to provide subsidies, when the state can scrounge up the money, to help pay truckers and others to replace older rigs or retrofit them with exhaust filters.

But progress with that strategy has been agonizingly slow and funds have been scarce.

Both Peveto and Price say the Volkswagen settlement money should be considered in connection with proposals to adopt a new diesel standard for what vehicles are allowed to operate in Oregon.

A bill to adopt a California-style phaseout didn’t advance far in the 2015 legislative session. But this spring, Sen. Michael Dembrow, D-Portland, assembled a broader work group to study the issue, including some of the critics of the 2015 bill. Now groups representing contractors, truckers, loggers, cities and counties are meeting together with environmentalists and others, Peveto says.

In the past, critics of a California-style standard haven’t complained about the need to get dirty diesel off the highways, Peveto says. “It’s an issue of who pays.”

She says now’s a good time to adopt a California-style standard, using the new pot of money from VW to help ease the pain. The Oregon Environmental Council, Price says, prefers to see what Dembrow’s work group comes up with before endorsing any new policies.

A bit more money may be coming down the road from Volkswagen, Downing says. The main decree applies to 2-liter diesel VW engines. There could be a later deal involving 3-liter VW, Audi and Porsche vehicles.

Hidden killer

Diesel soot includes tiny particulate matter that gets lodged inside peoples’ lungs, causing heart attacks, strokes, asthma and other cardiovascular maladies. It’s estimated that diesel soot causes 91 premature deaths and 70 nonfatal heart attacks each year just in Multnomah County, based on 2005 federal data crunched by the Boston-based Clean Air Task Force. Kevin Downing, who coordinates the Clean Diesel Program of the Oregon Department of Environmental Quality, calculates diesel causes about 250 premature deaths a year statewide, more than the combined number of people who die from homicide and drunken driving.