Trailer GHG Standards Paused Until May 2022

Summary#

The federal government approved an order that extends a pause on the trailer greenhouse-gas (GHG) rules in the Heavy-duty Vehicle and Engine Greenhouse Gas Emission Regulations. The pause was extended for up to one year, to May 3, 2022, while Canada waits for the outcome of related legal action in the United States.

What it does#

• Approves an interim order under the Canadian Environmental Protection Act, 1999 that suspends the trailer GHG standards in Canada until May 3, 2022.
• Keeps Canada aligned with the current U.S. situation, where the U.S. trailer standards are tied up in court and not being implemented by the U.S. Environmental Protection Agency (U.S. EPA) and National Highway Traffic Safety Administration (NHTSA).
• Leaves the GHG rules for heavy-duty vehicles and engines in place; only the trailer standards are affected.
• Notes the trade-off: suspending the trailer standards saves industry compliance and investment costs now, but reduces expected GHG reductions by about 0.4 megatonnes (Mt) for model year 2022, and by about 1.2 Mt when combined with model years 2020 and 2021 (compared with an estimated 73 Mt of reductions projected for 2020–2029 from the 2018 amendments).
• Continues consultations with the Canadian trailer and trucking industries while monitoring U.S. regulatory and court developments.

Who's affected#

• Canadian companies that make or import new on-road trailers for sale in Canada.
• Small Canadian trailer manufacturers (many have fewer than 100 employees) that make box vans and specialty trailers.
• Trucking companies and fleets that buy or operate trailers.
• The broader North American trailer supply chain, since the decision responds to uncertainty about U.S. rules.
• If unclear: the item affects those dealing with trailers covered by the regulation (for example, dry and refrigerated box van trailers, container chassis, flatbeds and tankers).

Why it matters#

• For small Canadian trailer makers, the pause avoids immediate compliance costs and a potential competitive disadvantage compared with larger U.S. manufacturers.
• For truck operators and buyers, the pause delays when newer, more fuel-efficient trailer designs become required, so fuel savings tied to those designs will also be delayed.
• For the climate, the pause reduces expected GHG cuts by the amounts noted above (0.4 Mt for model year 2022, ~1.2 Mt combined for 2020–2022).
• The government says the suspension is temporary and intended to keep Canada aligned with U.S. developments so industry has time to plan if and when U.S. rules move forward.