AIR POLLUTION:

Federal judges reject EPA rule on heavy-duty truck engine emissions

Federal appellate judges today again threw out a U.S. EPA rule related to its approval of heavy-duty truck engines that did not meet its air standards.

At issue is a long-running challenge to EPA's rulemaking following its 2001 engine emission standards for smog- and soot-forming nitrogen oxides, or NOx.

The standards required manufacturers to cut emissions by 95 percent by 2010. The industry split on how to accomplish that goal. Daimler Trucks North America, Mack Trucks Inc. and Volvo Group North America, among others, used selective catalytic reduction technology and met the limit. Navistar International Corp. developed another technology but failed to meet the standard.

EPA then issued a series of rules -- the latest in September 2012 -- that allowed Navistar's engines to obtain "certificates of conformity" and go on the market if the company paid nonconformance penalties of nearly $3,800 per engine.

At the heart of the U.S. Court of Appeals for the District of Columbia Circuit case is EPA's definition of "substantial work" in the 2012 rule. The term is one of several qualifying criteria for the nonconformance penalty. The rule said if EPA determines that "substantial work" is needed to meet the new standard, the manufacturer may introduce its engines to the market if it pays the penalty.

In the 2012 rule, EPA said Navistar had demonstrated "substantial work," but it looked back to the efforts the company had taken since the 2001 rule.

Daimler, Volvo and others have challenged EPA at every turn and have been successful at the D.C. Circuit previously (E&ENews PM, June 12, 2012). In this case, they challenged EPA's "substantial work" interpretation. They said "substantial work" is forward-looking, not retrospective. And, consequently, EPA's definition constituted a rules change that required a notice and comment period.

The D.C. Circuit agreed.

"Because of the lack of adequate notice and opportunity to comment on the amendments to the 'substantial work' regulation, we grant the petition," Judge Judith Rogers, a Democratic appointee, wrote on behalf of the unanimous three-judge panel.

"The revisions to the 'substantial work' criterion went beyond mere clarification," she added.

The court vacated the 2012 rule but acknowledged that it would have little effect because Navistar's new engines will be in compliance with the NOx standard by the beginning of 2014.

Click here to read the opinion.

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