Ditching diesel to build a healthier environment

A look behind the quiet war over the best way to electrify the nation's bus and truck fleets, which spew more health-destroying, global-warming gases than all passenger cars combined.

A version of this article appeared first on the Washington Monthly website. GoozNews will be on hiatus for the next three weeks.

In 2017, Proterra, an upstart manufacturer of all-electric transit buses, opened an assembly plant near Los Angeles. Edison International, which owns Southern California’s largest utility, invested in the facility. The state’s energy commission gave the company a significant grant to build it. When it opened, Governor Jerry Brown attended the ribbon-cutting ceremony. Not only would replacing diesel buses help the state achieve its decarbonization goals, Brown said, but assembling their replacements in the aptly named City of Industry would create hundreds of new jobs.

It was a textbook case of a government delivering on the promise that the green economy will deliver good-paying jobs for working-class Americans. While pursuing their environmental goals, California transit agencies were simultaneously leveraging their purchasing power to spur local economic development. Foothill Transit, which serves the San Gabriel and Pomona valleys, already operated 17 battery-powered Proterra buses—5 percent of its fleet—with another 30 on order in its quest to ditch fossil fuels by 2030. L.A.’s two public bus systems also placed new orders.

Fast forward six years. City of Industry’s dream of becoming a major e-bus manufacturing hub is dead. Earlier this year, Proterra closed the facility, laid off 300 workers, and consolidated production at its assembly plant in South Carolina, where it recently began constructing an additional plant to manufacture batteries, the most critical and expensive component in any e-vehicle.    

“While we have appreciated being a part of the Los Angeles business community and value the hard work and dedication of our teammates, streamlining our manufacturing operations will allow us to improve our production efficiency,” Proterra CEO Gareth Joyce said in a press release. The company did not mention that its workers’ wages in South Carolina are substantially below those of California, where employees belonged to the United Steelworkers Union.

Nor did the company mention a second possible reason for souring on southern California. Foothill Transit, an early adopter of natural gas-powered buses and e-buses, has moved on again. It recently retired half of its 33 battery-powered e-buses (BEBs), some over a decade old. And it plans to phase out the rest in a few years.

Instead, when the system’s fossil-fuel-burning buses wear out, Foothill will replace them with hydrogen fuel cell-powered e-buses (HFCEBs) made by NFI Group, a Canadian manufacturer. It has already sold Foothill nearly three dozen zero-emission HFCEBs, and recently received orders for another 19. The transit agency’s spokeswoman cited hydrogen power’s superior range, greater reliability, and reduced refueling times compared to battery-powered buses.

According to the Environmental Protection Agency, transportation is America’s the largest contributor to greenhouse gas emissions, accounting for 28 percent of its total each year. Passenger cars, the most numerous vehicles on the nation’s roadways, are not the worst offenders. Sports utility vehicles, pickup trucks, and minivans crowding America’s highways generate the most greenhouse gases, with 37 percent of all transportation emissions. Medium- and heavy-duty trucks and buses are second with 23 percent. Passenger cars account for only 21 percent of transportation’s greenhouse gases.

Yet the government and manufacturers have focused chiefly on transitioning their cars and light trucks to electric power, inconveniently ignoring the role played by big trucks and buses, which are powered almost entirely by diesel engines. Not only do they generate more carbon dioxide than cars, but they also produce noxious nitrogen oxides. NOx are a significant cause of the increased incidence of cardiovascular disease, asthma, and other respiratory ailments found in low- and moderate-income urban neighborhoods, which are disproportionately minority and are crisscrossed by the major freeways and busy streets. A stepped-up focus to help large truck and bus fleets make a rapid transition to zero emissions would not only do more to reduce global warming, but it would also have significant health benefits, especially in the communities that have been subjected to decades of environmental racism.  

Yet the Biden administration’s infrastructure and inflation control bills lavished their most generous subsidies on building out a nationwide charging network and subsidizing the purchase of battery-powered EVs built in the U.S. The global passenger auto industry responded in kind. Last year, traditional automakers and their suppliers unveiled plans to invest $73.6 billion in assembly and battery manufacturing plants in the United States over the next several years. Most of that investment will flow to southern states with lower wages and fewer unions. 

The market for battery-powered cars is dominated by Tesla, the industry leader, which owes much of its success to much-derided Obama-era green energy initiatives, including a $465 million federal loan in 2009 to scale production. The Elon Musk-owned upstart sold two-thirds of the 750,000 battery-powered vehicles produced last year (6 percent of the global market). Its plants are non-union, with relatively low-paid workers compared to other auto assembly plants.

Virtually all of Tesla’s vehicles are passenger sedans. Just 5 percent of its sales are SUVs. Other carmakers, rushing to catch up, likewise focus on transitioning their existing customer base to battery-powered passenger sedans. Only a few companies are venturing into the SUV/pickup truck/minivan EV market. Those like Ford and start-up Rivian measured their sales last year at fewer than 10,000 units each.

Still experimenting

Meanwhile, the transition to electricity-powered large trucks and buses, which run on diesel fuel, remains embryonic, even though these behemoths are major greenhouse gas polluters and have the most harmful health effects, especially in inner-city communities bisected by major highways. Fleet operators are still testing which zero-emission technology will best meet their needs: hydrogen-powered fuel cells or larger on-board battery packs.

There are numerous technological and operational challenges hindering faster electrification of heavy-duty vehicles with large battery packs. Because trucks, buses and vans need to travel long distances with heavy loads or make frequent stops, they require very large battery packs, which will sharply increase the demand for cobalt and lithium. Mining those minerals is environmentally destructive and aids the Democratic Republic of Congo and China, where human rights abuses abound.

Fleet operators also cannot afford to have their drivers spend an hour recharging their vehicles’ batteries. Even when fast chargers are in place, an urban transit rider won’t be willing to sit on a bus for 10 or 15 minutes for a recharge. That problem is compounded in regions with harsh winters when lithium-ion batteries lose as much as a third of their range.

Foothill in the Los Angeles basin areas isn’t the only transit system that sees hydrogen-powered buses as a superior alternative. The Champaign-Urbana Mass Transit District in central Illinois already has two HFCEBs. NFI’s New Flyer promises to deliver ten more by the end of this year, bringing its total to 10 percent of its fleet. The district plans to be 100 percent electric by 2035. “I am all in for electrification,” said CEO Karl Gnadt. “But if you’re turning to BEVs (battery-powered electric vehicles) and you’re burning coal, you’re not being intellectually honest about how green it is. It’s not zero emission. It’s moving the emissions.”

The 56-year-old joined the agency 33 years ago after earning his degree in public transit management from Indiana University. “If someone says BEB, I want to go along with it, but I want to know how it impacts what we do here, where does the power come from, what does it have to our service design,” he said. “I didn’t like the answers I was getting.”

A comic book fanatic with over 8000 in his collection, Gnadt is the current president of the Hydrogen Fuel Cell Business Council, a consortium of transit agencies and technology vendors pushing the technology. When I spoke to him, he quickly ticked off a half dozen operational reasons why HFCEBs are superior to BEBs. Their range is 250 miles, more than twice the current generation of battery-powered buses. They carry smaller batteries that last twice as long because they are continuously recharged, usully keeping them 40 percent to 60 percent charged, a range that extends battery life. There is no downtime needed to refuel. And they don’t lose range during cold weather, a major concern for transit systems in northeastern and midwestern cities.

He said that one of the most important reasons for switching to hydrogen was the lower cost of building the infrastructure needed to fuel the buses. The fuel delivery trucks, storage tanks, and pumps are similar in form and function to the system for delivering diesel fuel, which means existing bus yards only need new equipment, not major reconstruction to accommodate fuel storage and refueling. Nor will agencies need to build mid-route charging stations.

Hydrogen’s downside

However, from an energy standpoint, hydrogen-powered e-vehicles have one major drawback: It takes twice as much electricity to spin wheels using hydrogen compared to batteries. Hydrogen must first be produced by running electricity through water to produce hydrogen and oxygen. Then the two elements are recombined in an on-board fuel cell to produce electricity. The process cuts an HFCEB’s energy efficiency roughly in half compared to large battery packs, which draw their power from the grid.

That’s a viable option for areas with a high proportion of zero-greenhouse gas emissions and low-cost electricity generation, such as hydropower in the Pacific Northwest, nuclear in northern Illinois, or anywhere that generates juice from solar and wind. But it is bad news for areas like central and southern Illinois, where the power stations use high-sulfur local coal and are consistently ranked among the most polluting in the country.

The Champaign-Urbana transit system solved that problem by building a 5,500-panel solar array to power its own hydrogen production facility. “We greatly overproduce our solar electricity during the day, and we put the excess into the grid,” Gnadt said. “And overnight, we draw from the grid to have continuous operation. We net more solar energy than we use.”

Still, most transit agencies nationwide are hanging their electrification plans between the two poles of lithium-ion batteries. Pork-barrel politics at the Department of Transportation, now led by former South Bend, Indiana, Mayor Pete Buttigieg, feeds the bias toward BEBs. The first tranche of low- and no-emission bus grants from the Biden administration’s 2021 Infrastructure Investment and Jobs Act gave transit agencies running the nation’s seven largest bus systems—which account for nearly 40 percent of all bus trips—just 26 percent of the $1.66 billion earmarked for low- and no-emission buses.

The Chicago Transit Authority, for instance, which operates the nation’s second-largest mass transit system that includes over 1,800 buses, received just $29 million to expand its nascent BEB program. On the other hand, Lubbock, Texas, received nearly $40 million to replace two-thirds of its 74-bus fleet with hybrid buses, which, like hybrid cars, use fossil fuel for most of their miles. Indianapolis received $33 million to buy e-buses for a system serving 116,000 riders a week, less than 5 percent of the nearly 3 million people who hop on buses weekly in Chicago.

Infrastructure costs a concern

The bulk of the money was spread among 150 small and mid-sized transit agencies, allowing them to buy a handful of BEBs for their nascent electrification efforts. Unlike large systems, where the challenge of retrofitting multiple facilities and routes for electric recharging is formidable, the infrastructure requirements for smaller systems are more manageable.

Battery-powered buses “cost less than hydrogen buses, and the infrastructure to support five to 10 BEBs is much cheaper and easier to deploy than the infrastructure to support five to 10 fuel cell buses,” said Dan Raudebaugh, executive director of the Atlanta-based Center for Transportation and the Environment, which advises transit agencies making the transition to full electrification. “Additionally, the costs of electricity are well known across the U.S., and the rate of increase in these costs is very predictable. That is simply not the case for hydrogen.”

But it won’t be that way for long. Hydrogen-producing infrastructure is about to get a massive boost from the Biden administration’s Inflation Control Act, which earmarked $8 billion to build six to 10 regional hydrogen production hubs. The main impetus for that investment is the likelihood that owners of the nation’s freight truck and heavy equipment fleets (13 million vehicles on the road, 4 million of them long-distance tractor-trailers) will switch to hydrogen as their clean fuel of choice over the next several decades. The ability to carry their fuel onboard will enable them to operate extended hours and travel long distances without refueling.

Indeed, there may even be a role for modifying internal combustion engines to run on hydrogen. Columbus, Indiana-based Cummins Engine, a leading diesel engine manufacturer, recently introduced a traditional engine that uses compressed hydrogen in the same way that some trucks and buses today use compressed natural gas, which had been the bridge fuel of choice for several decades.

Hydrogen-fueled internal combustion engines are not zero emission. They burn off some of the oil used as a lubricant, for instance. But engineers at companies whose livelihood is threatened by the total elimination of the internal combustion engine are working on solving those problems by capturing or minimizing the emissions.

“Risk-averse end-users will find comfort in the tried-and-tested, reliable nature of internal combustion engines,” argues Jim Nebergall, Cummins’ hydrogen business general manager, on a company website.

An economic development opportunity

Yet executives at few major transit systems are contemplating turning to hydrogen, even those in cold climates where it might make the most sense. Toronto’s Transit Commission recently ordered 186 battery-powered buses from New Flyer with a pledge to buy 435 more over the next five years if the initial purchase meets its reliability and cost tests. Chicago is testing 25 Proterra BEBs along several routes in anticipation of acquiring over 100 per year beginning in 2026 as part of its plan to electrify its bus fleet fully by 2040.

The Chicago Transit Authority will need to raise $1.8 billion to $3.1 billion over the next 17 years to replace its current fleet with BEBs, with most of it going to retrofit its seven bus garages to accommodate electrification.

This spring, the Biden administration issued its Clean Hydrogen and Strategy Roadmap to deploy hydrogen fuel for heavy-duty vehicles, ships, aircraft, and many industries. “By 2030, the hydrogen economy could result in 100,000 net new direct and indirect jobs due to the build-out of new capital projects and clean hydrogen infrastructure,” the report said.

Clearly, there will be a role for both battery-powered and hydrogen-powered e-vehicles in a net zero emissions economy. State and local transit officials, especially in states that assemble and make parts for diesel-powered trucks and buses, should pay close attention to where manufacturing of those zero-emission will take place. It could wind up — like the bulk of the battery and electric passenger vehicle production — in southern right-to-work states, which is undermining the president’s promise that the transportation e-revolution will create “tens of thousands of good-paying and union jobs.”

“We’re seeing reinvestment, but the majority of it is going to the South, which in many cases looks like American maquiladoras,” said Adam Hersh, a senior economist at the Economic Policy Institute at the Chicago Federal Reserve’s annual auto industry outlook conference in January. He notes that unionization in the South is less than 4 percent, and the wage gap between the North and the South in the auto sector is more significant than for all industries, with a 15 percent wage gap than the regional chasm among the rest of U.S. industries.

The Chicago Transit Authority offers a solution. A decade ago,  it included a local manufacturing requirement in its request for bids for its next generation subway cars. Today, a plant making subway cars operated by CRRC Sifang, a publicly traded company run by a Chinese state-owned enterprise, employs 300 workers in a south Chicago neighborhood. It is just a few miles from the historic Pullman District that once produced most of the nation’s passenger railcars.

Over the next 15 years, the nation’s most prominent transit system will purchase thousands of zero-emission buses. There’s no reason why they couldn’t pool their purchasing clout to assure that those vehicles and their parts are built nearby by workers paid a living wage. It would not only help decarbonize the nation, it would help rejuvenate their own communities.