July 17, 2007 4:30 PM, EDT

Trucking Groups Back Tax Breaks for Onboard Power Units

Onboard Systems Help Reduce Emissions, ATA, CTA Say

American Trucking Associations and the Canadian Trucking Alliance Tuesday urged state and provincial governments to revise their fuel tax systems to encourage truckers to use truck idling reduction technology.

In a joint statement, ATA President Bill Graves and CTA Chief Executive Officer David Bradley asked International Fuel Tax Association member jurisdictions to stop taxing fuel used to operate idling reduction technology, mainly auxiliary power units, or APUs, that reduce diesel fuel consumption — and by extension greenhouse gas emissions — by heavy-duty trucks.

The IFTA is the organization of states and provinces through which motor carriers’ fuel use tax obligations are administered uniformly throughout North America.

Several studies have clearly shown that using a heavy-duty truck engine to power the heating and cooling of a truck cab is inefficient and environmentally unsound, the groups said.

“The use of idling reduction technology could reduce the fuel consumption of a long-haul tractor by some 1,900 gallons or 7,200 liters per year — which equates to an emissions reduction of greenhouse gases of some 42,000 pounds, or 19 metric tons. The tax system has a role to play in accelerating the use of this emission saving technology,” Bradley said.

APUs’ cost can vary from $6,000 $10,000, with an average of about $7,750. Likewise, the fuel consumption of an APU will vary, but may be estimated for an over-the-road operation at 500 gallons, or 1,900 liters, a year, the groups said.

At the average state fuel tax rate of about 22 cents per gallon and provincial rate of 15 cents a liter, an exemption would represent a tax savings of more than $100 a year.

“Coupled with operational savings, this is a significant incentive for installing an APU,” Graves said. “Governments have a role in regulating emission reductions from the trucking community but the public sector must also recognize its role in providing the business community with incentives to further reduce these emissions.”