More details have emerged of the additional penalties for Volkswagen AG (AIN, 23
February 2016) being mooted by different authorities in the United States, writes
Alan Bunting.
These ‘penalties are being viewed as ‘punishment’
for the German car maker’s misdemeanours in rigging diesel emission tests.
Environmental and
consumer groups are pushing the federal government to consider a long list of
possible reparations.
As well as funding
the promotion of electric cars, it is suggested by Frank O’Donnell, president
of Clean Air Watch, that fines be imposed on VW amounting to five times the
cost of cleaning up the rule-breaking pollution released by the engines.
O’Donnell cites the
precedent set in 1998 when nearly all manufacturers of heavy-duty truck diesel
engines were found guilty of so-called cycle-beating.
The US
Environmental Protection Agency (EPA) and the California Air Resources Board
(CARB) must now decide not only how VW can bring over-polluting diesel cars
into compliance and somehow reimburse owners of cars which cannot be modified
or retrofitted, but what other fines or penalties the company should face.
According to
Cynthia Giles, the EPA’s administrator for enforcement and compliance
assurance, any ‘offsetting projects’ had to provide ‘significant, quantifiable
benefits to public health or the environment. Accordingly, the agency may
reduce initially proposed penalties if the penalised company ‘agrees to such
supplemental projects’.
VW North America
spokesperson Jennine Ginivan says the company is continuing to work with EPA
and CARB ‘to develop remedies acceptable to the agencies, as quickly as
possible’.
Due to the scale of
the cheating, the EPA has indicated that VW may be required to eliminate more
pollution ‘than the raw amount of excessive NOx (oxides of nitrogen) that the
cars omitted’.
That could include,
Giles suggests – in addition to funding electric and hydrogen-fuelled car
development – paying for other indirectly related environmental projects, such
as retrofitting older trucks and buses in US cities that have air quality
problems with pollution-reducing devices.
According to
Patrick Hummel, an analyst with UBS AG in Zurich, Switzerland, the final cost
to Volkswagen globally, including recall repairs, remedial actions, investor
lawsuits and penalties, could exceed US$42.2 billion.
Dan Becker,
director of the Washington DC-based Safe Climate Campaign, says VW must also
make sure there are adequate incentives for owners of over-polluting diesel
cars to respond to dealer recalls to have their NOx emissions reduced.
According to Becker
there has never been a recall where every owner responded, even where a
physical safety issue was involved.
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