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Phase 2 Fuel Efficiency and Greenhouse Gas Reduction Delegated Assembly

NTEA expects the National Highway Traffic Safety Administration and the Environmental Protection Agency (EPA) will release the Phase 2 final rule for medium- and heavy-duty truck fuel efficiency and greenhouse gas reduction this summer.

In anticipation of the final rule, we wanted to provide some advanced information about a provision on which NTEA has been working since the Phase 1 proposal. We expect the final rule to provide rules for what is known as delegated assembly. Delegated assembly would allow for the possibility of emissions credits being provided to the certificate holder (OEM/engine manufacturer) for greenhouse reducing products added after an engine or vehicle configuration has been certified but before it is sold. This arrangement would require a private contractual agreement between the manufacturer/installer of the greenhouse gas reducing product and the EPA certificate holder.

For instance, a vehicle configuration is certified and a ladder rack is being added as part of the upfit. The ladder rack includes an aerodynamic shroud. This shroud produces a measurable amount of greenhouse gas reduction over the same configuration without the aerodynamic shroud. In this case the OEM could contract with the installer or producer of the shroud – or even the purchaser of the vehicles – to install these devices. The OEM could get credit for the greenhouse gas reduction based on the number of installations and the other party could be compensated in whatever manner is negotiated. These credits could be a part of the original vehicle certification or the certificate holder could use the additional credits in their averaging, banking and trading (ABT) efforts.

This scenario could cover any number of vehicle products or components not otherwise captured in the emissions certification process that reduce greenhouse gas emissions and are installed prior to the sale of the new truck.

Once the rule is finalized, NTEA will be able to provide more detailed information on this portion of the regulations, as well as others.

For more information, please contact NTEA at 800-441-6832 or info@ntea.com.