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In Pennsylvania, some of VW settlement funds replace old diesel vehicles with new diesel vehicles

  • Emily Pontecorvo/WHYY
A pickup truck that runs on compressed natural gas (CNG).

Marie Cusick / StateImpact Pennsylvania

A pickup truck that runs on compressed natural gas (CNG).

Gov. Tom Wolf announced this week that Pennsylvania will spend $8.5 million on new school buses, public buses, trash trucks, and electric-vehicle charging stations in an effort to reduce emissions. The money comes from a settlement related to the Volkswagen emissions scandal.

In 2017, Volkswagen pleaded guilty to cheating on its diesel vehicle emissions tests. As a result of the deception, about half a million Volkswagen vehicles on the road in the United States were polluting the air at much higher levels than what was allowed under the Clean Air Act.

The settlement awarded money to every state to fund emissions-reducing transportation projects. The money was awarded based on the number of noncompliant vehicles registered in each state. Pennsylvania got $118 million.

The Department of Environmental Protection is responsible for distributing the funds. The agency created the Driving PA Forward initiative, which disburses the money across seven different types of programs. In this most recent round of awards, 34 projects were granted funding. The projects include money for 60 new electric-vehicle charging stations. The rest of the projects fund replacements for old diesel buses and trucks.

One-third of these replacements simply swap out old diesel vehicles with new ones. Several replace diesel vehicles with those fueled by compressed natural gas or propane. Only one of the projects funds an electric vehicle.

Critics say too much money is going to fund new diesel vehicles. Logan Welde, staff attorney and head of legislative affairs for the Clean Air Council, was disappointed that there weren’t more electric vehicle projects funded. He was especially concerned about money that went to converting old diesel school buses to new diesel school buses.

“That really doesn’t help the young kids who are going to be on these buses, sometimes for hours every day,” said Welde. “These school buses that they’re buying now are going to be in service for probably 15 to 30 years.”

The DEP received three applications for electric vehicles this round and funded one of them. The Port Authority of Allegheny County was awarded $1 million to replace two diesel buses with two new battery electric buses, a $2.4 million dollar project.

This is the second round of awards Pennsylvania has granted from the settlement fund. The state awarded $580,000 to six projects last year, four of which included new diesel vehicles.

One reason for the disproportionate number of awards to diesel vehicles may be that the funding structure currently favors purchase of them. For example, during the most recent round of awards, a government entity wishing to replace a school bus could receive a maximum of $40,000 for a new diesel bus, or $50,000 for a compressed natural gas, propane, or electric bus. Those alternative-fuel vehicles are much more expensive than new diesel vehicles. An electric bus can cost twice as much as a diesel bus.

Deborah Klenotic, a spokeswoman for the DEP, said its goal was to achieve the greatest emission reduction possible per dollar of settlement funding. Citing data from the Federal Highway Administration, she said that replacing a diesel bus with an electric bus costs $2 million per ton of nitrogen oxide and that the new diesel technology was “greatly improved.”

“The [electric vehicle] technology is still uncommon and therefore extremely expensive,” Klenotic said in an email.

The DEP developed the programs after a series of public meetings in 2017. Some areas of the state advocated for electric-vehicle funding; others advocated for natural gas. Klenotic said the agency aimed to strike a balance while creating the most cost-effective program to reduce emissions.

Tom Schuster, senior campaign manager for the Sierra Club, thinks that was the wrong approach.

“We would encourage the DEP to revisit some of the funding formulas,” Schuster said. He wants to see the formulas reversed so that they incentivize electric vehicles.

“It may result in fewer vehicles being retrofitted, but it would really start to spur additional private-sector investment [in electrification],” he said.

Other states are prioritizing the settlement money differently. In New Jersey, the most recent round of funding went to nine projects, all of which involved replacing diesel vehicles with electric ones.

Tony Bandiero, executive director for the Eastern Pennsylvania Alliance for Clean Transportation, agreed that the program gave too much money to new diesel vehicles, but he applauded the state for its slow rollout of the funds. There is more than $100 million left to disburse, and Bandiero said there is flexibility in the Driving PA Forward program to reassess how it’s working and change the funding structure in future years.

“It was an oversight, it was them trying to figure out how this is going to work. I have a good feeling they will adjust the guidelines for that program next year,” Bandiero said.

The state is allowed to spend 15% of the total settlement money on electric-vehicle chargers. In Philadelphia, the 10 Rittenhouse Square Condominium association was granted $16,000 to install two new EV chargers. David Benton, general manager for the building, said that the chargers cost $17,600 total, so it was a good investment.

Benton said the association knew it would have to install chargers some time in the next two years to be competitive with other luxury condominiums. He said a resident there would be unlikely to exchange a car for a Prius but would likely purchase an electric BMW, Audi, or Jaguar.

“With those cars coming out, we thought, ‘Now’s the time,’” he said. The chargers at 10 Rittenhouse Square will only be available to current residents.

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