California’s trucking industry spent Wednesday speculating about the future of its vehicle mix now that there will be no state mandate to buy zero-emission vehicles following the effective death of the Advanced Clean Fleets rule.
The ACF was killed for all intents and purposes by the California Air Resources Board (CARB) when it withdrew its waiver request under the Clean Air Act to the Environmental Protection Agency. If granted, the waiver would have allowed the regulation to move forward. However, the Advanced Clean Trucks (ACT) rule remains on the books and has an EPA waiver.
The end result: a lot of uncertainty on everything except the fact that there will be no ACF anytime in the near future.
“The bottom line here is that the ACF, and really, California’s move to electrify its trucks, is pretty much dead for now,” Glen Kedzie, a principal with E&E Strategies and a longtime specialist in environmental regulations impacting trucking, told FreightWaves in an interview.
Not all because of a new administration
The conventional wisdom is that CARB’s decision to withdraw its waiver request was driven by the reality that a Trump administration was not likely to grant the waiver, but several observers close to the process disputed that as overly simplistic.
As Matt Schrap, the CEO of the drayage-focused Harbor Trucking Association noted, a process that was assumed at the start was likely to end with a waiver granted had not, just days before the end of an administration that has leaned heavily into alternative transportation fuels, actually yielded one. “They could have, but they didn’t,” Schrap said.
That is likely to have led to some soul-searching at CARB, Kedzie said.
“There was plenty of justification to do what ended up happening at the end,” Kedzie said in an interview with FreightWaves. “If EPA had denied the waiver, then CARB would have been in a place where it is kind of like a black eye.”
The history of waiver requests from California to the EPA under the Clean Air Act is one of the state’s getting almost everything it had sought. A rejection of the ACF waiver would have been a notable change.
“I’m sure there were a lot of discussions between the legal beagles at CARB and the legal beagles at EPA,” Kedzie said. And those discussions, he said, may have involved an ultimatum from EPA: “You can withdraw it, or we’re going to end up denying it.”
Goals were too ambitous?
But the reason would not have solely been the pending arrival of a Trump administration not likely to have favored the waiver. Instead, both Kedzie and Schrap said, it was the argument that the trucking sector has long made that may have been accepted by EPA: The goals of the ACF were too ambitious and not workable.
“All the comments that were filed into the docket, all the meetings that were had, what the pathways that were projected by CARB didn’t end up being reality,” Kedzie said. “So this was not just a Trump thing. This is EPA truly having their doubts that this is workable.”
Schrap echoed that view. “Ideally, this is an opportunity to take a step back and to look at the rule and to ideally eventually craft something, a pathway that’s actually reflective of reality,” he said.
Chris Shimoda, the senior vice president for government affiars at the California Trucking Association, echoed a similar sentiment in an email to FreightWaves. “What’s hopefully become more clear is that there were challenges we knew at the time these rules were being discussed and the challenges which became apparent during the implementation process,” he said. “Grid infrastructure constraints were not well understood, for example. There is little a fleet or truck manufacturer can do to speed up transmission lines or a substation.”
The ACF had several regulations. Among the key ones were limits on how long an internal combustion engine could stay on the road mixed with a rule that all truck sales after 2035 were required to be ZEVs. That combination was seen as phasing out all ICE trucks in the state by sometime around 2045.
There was nothing in any of the comments released by CARB Wednesday that indicated anything other than the incoming administration as the reason for the decision to pull the waiver request.
In a prepared statement issued by CARB chair Liane Randolph, there was no suggestion that EPA had expressed resistance to granting a waiver on the merits. She said the agency “was unable to act on all the requests in time” and referred to “uncertainty” created by “the incoming administration that previously attacked California’s programs to protect public health and the climate and [who] has said will continue to oppose those programs.”
But whatever the politics, once the shock wears off, California – and some other states – has a conundrum. It has a policy, the Advanced Clean Trucks rule, that mandates a rising level of ZEVs be sold into the state – but there no longer is a mandate for anybody to buy them.
Mike Hoheisel, who has a long career selling trucks at the retail level on the West Coast and who most recently was focused on ZEVs, described the strategy: “They thought they were going to get the waiver for both,” he told FreightWaves. “He said the two rules were “co-working regulations” and “they figured the waiver for the ACT was going to cover the ACF.”
Complicating matters in the already sticky situation of the ACT existing in a non-ACF world is the fact that a group of engine manufacturers signed an agreement under the banner of the Clean Truck Partnership that saw California agree to align its 2024 nitrogen oxide rule with the federal rule on NOx that doesn’t go into effect until 2027. In return, the engine manufacturers agreed not to challenge California regulations in court.
And as Hoheisel noted, the further complication is that several states agreed to follow California’s ACT requirements in their own borders. This page from CARB of all states that have chosen to follow California’s lead on vehicle emission standards lists 10 states that have signed on to the basic aspects of the Advanced Clean Truck standard : Colorado, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont and Washington. CARB lists no states following the ACF.
ICE sales are challenged in ACT states
That situation brought Hoheisel back to the growing observation that sales of internal combustion engine diesel trucks are falling in states that have signed on to the ACT. “If you don’t sell ZEVs, you can’t increase your credits to be able to sell more of the diesel engines,” he said. But trying to sell more ZEVs to generate the credits that offset the sales of ICE diesel trucks – which already was a challenge for Class 8 vehicles – now will need to be made into a market with no mandate to buy them, he said.
“You’re basically going to see the destruction of diesel sales in the ACT states, and you’re going to see staff and dealerships struggle,” Hoheisel said.
Shimoda said while truck sales are largely flat nationwide, some dealer networks in California have seen their inventory fall 60% or more.
Another big area of uncertainty: Will the Trump administration seek to revoke the waiver granted to CARB in March 2023 to implement the ACT? And what would a court case challenging the revocation, presumably filed by California and environmental groups, look like?
The American Truck Dealers Association expressed support for that action in a statement about CARB’s decision.
“ATD has engaged with the Trump transition team to express support for its intention to revoke the remaining California ACT and Omnibus NOx CARB waivers, and will continue to press for a sensible and achievable emissions regulation that reflect the market realities of the industry,” the group’s president, Jacqueline Gelb, said in the statement.
(The Omnibus NOx waiver that allowed California to have stricter rules for that pollutant was issued in late December).
Meanwhile, Randolph suggested in her statement that CARB would seek to keep those waivers in place, without identifying them by name. “The waivers and authorizations recently approved, along with other existing programs, will advance essential emissions reductions in key sectors as we assess next steps,” she said.
The most immediate impact on fleets from the end to the ACF might be a presumed end to the ACF mandate that only ZEV vehicles could be registered with California’s drayage registry after Jan. 1, 2024. Most of the other requirements in the ACF would not have had significant impact on the mix of new truck sales for a few years.
While the drayage mandate was put on hold once CARB asked for a waiver in the last weeks of 2023, the agency had also said it could enforce the rule retroactively.
Possibly as a result of the prospect of the waiver being granted and the drayage rule coming into effect eventually, ZEVs reported as active at the Port of Long Beach rose to 423 in November 2024, the most recent month for which data is available, from 198 in December 2023.
Schrap, whose members would have been the most impacted by the drayage rule, expressed caution about assuming that the end of the ACF would lead to the end or a sharp reduction in ZEV drayage vehicles at the ports of Long Beach and Los Angeles.
He noted that the South Coast Air Quality Management District has its Indirect Source Rule, which regulates emissions from warehouses more than 100,000 square feet in size in Southern California, like the warehouses that the drayage trucks visit. “The ISR may encourage facility operators to start looking at strategies to get fleets to service those facilities with lower-emission vehicles,” Schrap said.
That could mean ZEV drayage trucks to serve them. But Schrap also said that with the ZEV mandate gone, that could mean natural gas-fueled vehicles could help meet ISR goals, because their emissions are lower than diesel even though they are not ZEVs.
They are often referred to as NZEVs, or near ZEVs. But they had no role in the ACF and were not considered by CARB as a solution to its climate goals.
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