Detroit Diesel will pay $28.5 million in a settlement with the US Environmental Protection Agency (EPA) and the US Department of Justice (DOJ) to resolve alleged violations of the Clean Air Act for selling heavy-duty diesel engines that were not certified by EPA and did not meet applicable emission standards. Under the settlement, Detroit Diesel will spend $14.5 million on projects to reduce nitrogen oxide and other pollutants, including replacing high-polluting diesel school buses and locomotive engines with models that meet current emissions standards. Detroit Diesel will also pay a $14 million civil penalty.
The government’s complaint, filed along with the settlement, alleges that Detroit Diesel violated the Clean Air Act by introducing into commerce 7,786 heavy-duty diesel engines for use in trucks and buses in model year 2010 without a valid EPA-issued certificate of conformity demonstrating conformance with Clean Air Act standards to control nitrogen oxide (NOx) emissions. The complaint also alleges that the engines did not conform to emission standards applicable to model year 2010 engines.
The school bus and locomotive replacement projects in the settlement will reduce ambient air levels of NOx and other pollutants. In addition, the school bus program will improve air quality inside school buses by reducing exposure to diesel exhaust. Detroit Diesel intends to target areas for the replacement projects that do not meet Clean Air Act standards for certain air pollutants and areas with low-income communities.
The Clean Air Act requires manufacturers to obtain a certificate of conformity demonstrating compliance with emission standards before introducing an engine into commerce. Certificates of conformity cover only those engines produced within a single model year. A model year for a family of engines ends either when the last such engine is produced, or on December 31 of the calendar year for which the model year is named, whichever date is sooner.
The complaint alleges that Detroit Diesel commenced construction of the heavy-duty diesel engines during model year 2009, but did not complete construction of the engines until calendar year 2010. Because Detroit Diesel completed all manufacturing and assembling processes for the engines in 2010, the complaint alleges that the engines were produced in 2010 and required a certificate of conformity demonstrating compliance with 2010 emission standards.
When EPA signed emission standards for model year 2007 and later heavy-duty highway engines, it included a phase-in on the ultimate NOx standard (0.20 g/bhp·hr) between 2007 and 2010, with full compliance reuqired in 2010. (The phase-in was on a percent-of-sales basis: 50% from 2007 to 2009 and 100% in 2010.) Up through 2009, most manufacturers were meeting a higher NOx limit; the “EPA 2010” engines were technologically distinct from their higher-emitting predecessors.
From approximately 5 January 2010 through approximately 1 June 2010, Detroit Diesel sold the engines for on-highway use in heavy duty vehicles. Because the engines were not certified to the more stringent 2010 NOx emission standards, Detroit Diesel’s introduction of these engines resulted in excess emissions. The engines were manufactured in Detroit, Michigan, but were introduced into commerce across the country.
Under the consent decree, Detroit Diesel will be required to implement projects to replace high-polluting school buses with school buses that meet current federal emissions standards and replace or repower high-polluting switch locomotives. Detroit Diesel is also required to post data and information about the clean diesel projects on a public website.
Detroit Diesel Corp. is a Michigan corporation that began as a diesel engine manufacturing division of the General Motors Corporation in 1938. It is currently a wholly-owned subsidiary of Daimler Trucks North America. Detroit Diesel manufactures heavy-duty diesel engines, axles and transmissions for the on-highway and vocational truck markets.
The consent decree was lodged in the District Court for the District of Columbia. Notice of the lodging will appear in the Federal Register allowing for a public comment period of not less than 30 days before the consent decree can be entered by the court as final judgement. The $14 million civil penalty is due 30 days after the effective date of the consent decree.