Funds totaling $49.2 million tied to the Diesel Emissions Reduction Program, or DERP, are set to expire this spring. But despite the recession, there is hope that funding at several times the current dollar amount will be available for cleaning up the nation’s school bus fleet.

An additional economic stimulus package of at least $400 billion to $500 billion that would create 2.5 million jobs over the next two years, a major component of which would include incentives for developing new and promoting existing green energy. Emission retrofits and vehicle replacement could be boons for the school transportation industry.

Congress originally authorized $200 million a year for DERP, which was passed under the Diesel Emissions Reduction Act of 2005, or DERA. But the final funds so far have fallen woefully short. Still, with three years remaining, it has realized successes despite spreading the money over heavy-duty trucking, transit and school bus segments.

According to the Manufacturers of Emission Controls Association, 35,917 diesel retrofit devices were sold by member companies nationwide in 2007, of which 45 percent were DOCs and 31 percent were DPFs. Another 5,751 closed-crankcase filters were also sold. According to EPA estimates, the DERP program offers $13 in emissions benefits for every $1 put into the program.

“Clearly the DERA program is a program that does work,” commented Gabe Rozsa, a D.C.-based lobbyist specializing in emissions and clean air initiatives for NSTA. “It uses domestically manufactured technology to reduce emissions, which have positives in a whole variety of opps. But it’s been under-funded. So (a stimulus package) is a logical step for them to take.”

The DERP money is mainly administered through the EPA’s seven clean air collaboratives nationwide to fund the “5 Rs” of replace, retrofit, repower, refuel and rebuild. Separate funds are available through the Federal Highway Administration’s Congestion Mitigation and Air Quality, or CMAQ, program, which specifically targets carbon monoxide, hydrocarbons and ozone. But despite emerging engine technologies tied to the EPA 2007 and 2010 standards for clean air, ultra-fine particulate matter will continue to be a challenge, especially PM2.5 emissions that can get trapped in the lungs. According to the the Emission Control Technology Association, PM2.5 is estimated to be anywhere from two to 20 times more harmful than nitrous oxide, more than 100 times harmful than ozone and 2,000 times more harmful than carbon monoxide, highlighting the need for state and federal funds for diesel oxidation catalysts and diesel particulate filters.

“It’s a blend of federal money and matching state funds; the more you match the more you get,” said Andre Bogacz, a heavy duty diesel retrofit specialist with BASF Catalysts, explaining the breakdown of available funds. “We believe the stimulus package coming may increase retrofit funding further. The plus-side to it is it’s cleaning the environment and not outsourcing the products or the work. Job creation is a plus.”

California, where on-road diesel engines account for more than a quarter of all PM emissions, was among the first states to mandate retrofits with its Carl Moyer program. But industry sources cited movement in this direction across the country. In addition to a three-year school bus retrofit project in Massachusetts, Indiana, Michigan, Minnesota, Ohio, Oregon, Texas, Washington state, and Wisconsin are but a few states with similar programs using their own funds.

And those funds are certain to be put to good use as technology mandated by the EPA’s requirements for 2010 and beyond becomes more complex. School districts and bus companies must ensure any installed emissions-control equipment meets strict state guidelines for state-run programs or emissions control devices that adhere to EPA and/or CARB standards for federal programs. Either way, there are verification programs that manufacturers must pass to demonstrate their products perform as advertised.

“School bus operators do need to understand the requirements of retrofit products [for older models] as well as the 2007 and 2010 engines that come with aftertreatment as part of the vehicle purchase,” he said.

“Any new diesel bus purchased today, and into the foreseen future, will have an elaborate DPF and EGR emissions system with a very expensive and elaborate exhaust system,” added Eric Sauls, national sales manager at Grand Rock Heavy Truck Exhaust. “The life expectancy of these new motors and their emissions devices is still to be determined. This is all relatively very recent production stuff. Time has not proven anything out yet, from what I’ve seen.”

Reprinted from the January 2009 issue of School Transportation News magazine. All rights reserved.