Nevada was granted $24.8 million of a $2.8 billion national settlement reached with Volkswagen after the auto company was caught installing devices on some of its vehicles meant to fool emissions tests – allowing up to 40 times the allowable amount of emissions into the air in some cases.
The main recipients of the VW settlement money in Nevada so far: commercial airlines.
Distribution of Volkswagen settlement funds is being determined through a state mitigation plan. Nevada’s Division of Environmental Protection (NDEP) is the designated lead agency acting on the state’s behalf to distribute Nevada’s share of $24.8 million from the settlement.
About $7.4 million competitive funding grants from the settlement, including administrative costs, have been distributed so far. Most of it — $5.3 million — has been used to subsidize the replacement of airport ground equipment like belt loaders, baggage tugs, and pushback tugs which are used to push airplanes away from the airport gate.
Three airlines benefited from these competitive grants — Allegiant Air, Southwest Airlines, and United Airlines.
Airport ground support equipment replacement or repower projects are eligible for up to 60 percent of the cost to replace or repower their existing equipment with an all-electric replacement or all-electric engine.
The purpose of the Nevada Diesel Emission Mitigation Fund “is to provide funding incentives for projects that will reduce harmful diesel emissions from public and privately-owned fleets operating in Nevada in order to improve and maintain air quality.”
Projects are selected based on a number of “scoring criteria” that include cost-effectiveness and scope of emission reductions, project location, environmental co-benefits, likelihood of future emission reductions, project feasibility and societal co-benefits.
“What we are trying to do is maximize these benefits to air quality for the money this settlement has provided us,” said Danilo Dragoni, chief of the bureau of quality planning for NDEP.
“Airport applications score pretty well with all these criteria. Airport ground support equipment in general is very old, and gasoline powered equipment, and very polluting. When we convert it there are a large amount of emissions that are removed from the air,” said Dragoni.
“Just with the projects that were submitted by the airlines, we will recover more than all the emissions that the cheating Volkswagen cars were emitting and will be emitting in their useful life.”
The division estimates that the projects funded to date would mitigate or reduce nearly 756 tons of nitrogen oxide from the air.
“That more than completely covers our estimated excess emissions that are associated with Volkswagen’s cheating cars,” said Joe Perreira, program lead for the Volkswagen settlement fund.
Of awarded competitive funds, roughly $1 million has gone toward helping replace buses in school districts ($672,000) and the Southern Nevada Regional Transportation Commission buses ($300,000).
Another $200,000 has been awarded to Republic Services to subsidize the replacement of five garbage trucks from diesel to natural gas.
“Those big engines that sit and idle, that’s what we’re after,” said Perreira.
The Nevada Electric Highway— a partnership between the Governor’s Office of Energy and NV Energy to expand charging infrastructure along U.S. 95 between Reno and Las Vegas— is also being funded by $4.1 million in Volkswagen settlement funds.
About another $825,000 has been allocated to the Nevada Clean Diesel Program so far, which voluntarily matches federal grant dollars, and which NDEP plans on funding for “at least a couple more years.”
Officials have yet to allocate roughly $10.1 million of the VW money. Applications for the 2019 Diesel Emission Mitigation Fund Competitive cycle closed on July 31 and distribution has yet to be awarded.
Location, Location, Location
Led by the grants to airlines, projects in Clark County have been awarded the most— about $5 million— from the settlement’s competitive funds. Projects in Washoe County have been awarded over $1 million and the rest of Nevada about $138,000.
Part of the competitive grants criteria was location, and high motor vehicle traffic in cities creates a larger burden of nitrogen oxides pollution.
The Las Vegas metro area sits in the only Nevada basin the Environmental Protection Agency (EPA) lists as an “ozone marginal nonattainment area,” meaning it does not meet EPA national ambient air quality standards for ozone.
Washoe County is similarly listed as a priority area in NDEP’s mitigation plan.
“It’s kind of a delicate balance of how much we want to offer for the benefit of higher air quality that we get back,” Dragoni said.
Wasn’t VW settlement money supposed to pay for electric school buses?
Sort of but no dice.
From Washington to Virginia, states across the country have funneled their share of the settlement money into funding electric school buses, a movement enjoying growing support even among presidential candidates.
Nevada has not followed that trend, instead choosing to spend much of the funds so far on airport ground support equipment and the Nevada Electric Highway project.
As part of the state’s mitigation plan, school districts were given the option to replace these buses by using the funds to cover 30 percent of the purchase cost of new diesel buses, 35 percent of alternative fuel buses, or 40 percent of the purchase cost for all-electric buses.
But schools districts have all applied for diesel or biodiesel replacements for their fleets. School districts cited a lack of charging or fueling infrastructure in their districts for their reluctance to purchase electric school buses, since the fund does not cover those costs.
Battery limitations and the cost of electric buses were another factor. Electric buses consistently cost more than diesel buses, though costs are falling with increased demand and better technology.
The Clark County School District (CCSD) issued a statement saying cost and lack of infrastructure for electric school buses make them financially untenable.
The district said they replaced five buses in their fleet with new biodiesel buses which will increase fuel efficiency, reduce emissions and save the district money.
“Electric and CNG powered school buses require additional infrastructure for refueling purposes. As collaborative conversations continue to take place with Nevada Power and Southwest Gas, additional cost analysis will be required to ensure the added cost of the infrastructure and increased bus purchase price does not negatively impact CCSD’s budget,” read the statement.
The Washoe County School District applied for the replacement of one diesel bus and four biodiesel buses. Rick Martin, the director of transportation for the school district, said the mountainous terrain in Northern Nevada, limited fueling infrastructure, and battery limitations in electric school buses made their purchase infeasible.
“We have done some research and unfortunately we just don’t have the terrain for them due to the mountainous region,” said Martin. “There’s also a large cost to buying the infrastructure. There’s a lot more to it than just buying the bus.”
“We’ll continue to look into them but we have to be good stewards and make sure it can work for us. We are not opposed to them. They just aren’t there for our needs yet.”
The Pershing County School District similarly applied for a diesel replacement of one school bus, choosing to avoid alternative fuel buses due to a lack of infrastructure and battery limitations in electric school buses.
“We chose to go the diesel route instead of doing natural gas or propane or electric because of our remoteness. Our bus routes one way is about 70 miles each morning,” said Tod Donaldson, the transportation director for the Pershing County School District. “The capital expense that it would have cost to put in a fueling station of propane or natural gas or electric wouldn’t have been fiscally responsible on my part to do that for the district.”
David Jensen, Superintendent Humboldt County School District, said his district has five school buses that are from 1997 or older — replacements for these older models are eligible for up to 75 percent of the cost under the state’s mitigation, plan making it fiscally possible for the district to finally update their fleet.
“As we evaluated the potential of purchasing clean energy or electric buses, one obstacle is the cost requirement the district would incur in order to provide the necessary fuel for these vehicles,” Jensen said. “In order to station a small compressed natural gas location, we would anticipate a cost of $70,000 or more. We did not have a price projection for electric, but ultimately, it too would have a large cost price point. This becomes a barrier as we would incur those expenses.”