The California Trucking Association (CTA) has filed a lawsuit in the U.S. District Court for the Eastern District of California, attempting to halt the implementation of the state's regulation mandating a transition to zero-emissions vehicles by 2042. They argue that this rule, known as the Advanced Clean Fleets regulation by the California Air Resources Board, is a significant overreach and poses a grave threat to the survival of the trucking industry.
While the introduction of the zero-emissions regulation was originally sought to support climate change incentives and reduce the footprint of the trucking industry, professionals within the industry argue the timeline and strict policies are more damaging than useful if not amended.
The Zero Emissions Regulation
In 2020, California became the first state in the United States to establish a requirement for the sale of zero-emission trucks. The mandate was set to be effective starting with the 2024 model year heavy-duty vehicles, meaning truck manufacturers would need to incrementally increase their annual sales of electric models through 2035. By 2035, 40% of large trucks, 50% of cargo and travel vans, and 75% of box trucks and dump truck sales were expected to have zero emissions.
Technically, federal law prohibits individual states from setting their own emission standards for motor vehicles, but California has a loophole in its climate regulations. the provision in the federal Clean Air Act that grants California the authority to enforce its own standards if it obtains a waiver from the EPA. This waiver extends to states that choose to adopt the California standard.
Since California’s enactment of the waiver, six additional states, including New York, New Jersey, Washington, Oregon, Massachusetts, and Vermont, have adopted the Advanced Clean Trucks regulation. Additional states are in the process of introducing these regulations, which would drastically alter the trucking industry and the way in which it operates. It also poses a significant financial investment for organizations that are required by law to adhere to these changes in the suggested timeline.
Why is the CTA Pushing Back?
The Chief Executive of the CTA, Eric Sauer, released a statement claiming, “California's trucking industry had concerns about the rule in part because it set unrealistic deadlines for a radical shift in the industry”. While the association does fully support climate-protecting measures, the main pushback is the deadlines to which they are expected to adhere.
Currently, much of the trucking industry does not run on zero-emission vehicles, and the state of the industry is already fragile. After the pandemic, trucking businesses faced extreme loss of labor along with increased demand for business. In addition, many businesses had to downsize their fleet due to a lack of parts being available for maintenance. Since the pandemic, trucking has slowed down and forced additional layoffs across the nation. All these aspects have made finances a huge concern for the industry, and replacing an entire fleet feels out of reach for most. Businesses are struggling as is, and many believe that the expectations of zero emissions would require resources that are not currently available.
As of right now, no comments or decisions have been made on the lawsuit itself, but it does raise questions for other states aligning with the Zero Emissions Act as to whether these deadlines are feasible.
Insurance Changes for New Fleets
In addition to the standard changes it would require to enroll new vehicles in line with zero emissions, businesses also need to consider changes to their insurance to reflect new risks. Zero-emission vehicles tend to have more complex electric parts, which require different maintenance routines, replacements, and care.
For organizations beginning the transition to new vehicles, it's important to work with your insurance agent and ensure your coverage reflects your current needs. Even if you haven’t started to transition but plan to adhere to standards, planning ahead for your coverage needs will ensure you effectively manage your risk, and aren’t left with gaps.
Insurance with ECBM
ECBM Insurance brings a wealth of experience and expertise in trucking and auto insurance, and we can cater our services to your insurance needs. Whether you're operating a fleet of conventional trucks or transitioning to zero-emission vehicles, our team is well-equipped to provide you with the comprehensive coverage solutions your business requires. Reach out to us for more information and discover how we can tailor our services to your specific needs.