Volkswagen and Audi Clean Air Act Partial Settlement

 
 
Public Involvement
Request for comments - deadline has passed
  • You can view the public comments here.
  • You can view the summary document of public comments here.
 
Past meeting:
November 7, 2016, 9:00 - 11:30 am, CDPHE’s Sabin-Cleere Room (Building A)
4300 Cherry Creek Drive South, Denver, CO 80246
Agenda 

Volkswagen and Audi Clean Air Act Partial Settlement

Volkswagen has agreed to settle some of the allegations that it violated the federal Clean Air Act by selling vehicles that emit more air pollution than the Clean Air Act allows, and by cheating on federal emission tests to hide the excess pollution. The affected vehicles exceed emission limits for nitrogen oxides (NOx), a pollutant that harms public health and forms ozone or smog. The first partial settlement, regarding the installation and use of emission testing defeat devices in 2.0 Liter vehicles, was approved by a federal court in California on October 25, 2016.  Additionally, on December 20, 2016 an agreement was reached in a second partial settlement regarding the installation and use of emission testing defeat devices in 3.0 Liter vehicles sold and operated in the U.S. beginning in 2009.

The first partial settlement requires Volkswagen to pay $2.7 billion into an environmental trust fund, and the second partial settlement requires an additional $225 million.  In total, Colorado expects to receive $68 million from the environmental mitigation trust between 2017 and 2027 ($61 million from the 2.0 Liter consent decree and $7 million from the 3.0 Liter consent decree). The trust fund will be used to offset the excess air pollution emitted by some of the Volkswagen vehicles that violated the Clean Air Act. This summary focuses on the environmental mitigation trust fund and how Colorado will administer its share.

Separate parts of the settlement would require Volkswagen to earmark about $10 billion to buy back affected vehicles, terminate leases early, or repair the vehicles. Additionally, Volkswagen is required to invest $2 billion over 10 years in zero emissions vehicle (ZEV) infrastructure, access, and awareness initiatives. Volkswagen, the U.S. EPA and California – not Colorado – will administer these parts of the settlement.  


The $68 million allocated to Colorado will fund certain eligible projects to reduce NOx emissions from the transportation sector. The Colorado Department of Public Health and Environment (CDPHE) is the state’s lead agency to oversee how this money is distributed and spent. The funds will be used to achieve the maximum air quality benefits for the people of Colorado. In addition to cutting NOx emissions, the projects that receive funding are likely to reduce ozone concentrations and emissions of carbon dioxide and other pollutants.  


CDPHE is working with the Colorado Department of Transportation, Colorado Energy Office, and other agencies to establish a public process to administer the settlement. No decisions have been made about how to spend Colorado’s share of the settlement or who will receive this money. During the fall of 2016, state agencies will conduct outreach to potential beneficiaries, government officials, transportation organizations and the public.  State agencies will solicit information and ideas about how the settlement money should be spent. Details about the application process will be determined in early-mid 2017. Colorado anticipates and hopes that funds will be available by early 2018.

The 2.0 Liter Partial Consent Decree for Volkswagen can be found here.
The 3.0 Liter Partial Consent Decree for Volkswagen can be found here
You can learn more about the Volkswagen Clean Air Act Partial Settlement here.
 
Mitigation Activities Eligible for Funding:
  • Class 8 Local Freight Trucks and Port Drayage Trucks (Eligible Large Trucks)
  • Class 4-8 School Bus, Shuttle Bus, or Transit Bus (Eligible Buses)
  • Railroad Freight Switchers 
  • Class 4-7 Local Freight Trucks (Eligible Medium Trucks)
  • Airport Ground Support Equipment
  • Forklifts
  • Light Duty Zero Emission Vehicle Supply Equipment 
  • Matching funds for projects eligible under the Diesel Emission Reduction Act (DERA)
See Appendix D-2 of the proposed Consent Decree (page 208 of 225) for more details.*
* Ferry boats, tug boats, and shorepower equipment for ocean going vessels are also eligible.
 
Impacts in Colorado (from the October 6th 2015 dataset, model years 2008-2015)
  • 9,350 VW or Audi 2.0 Liter diesels statewide (0.27% of the vehicle fleet) 
  • 6,065 VW or Audi 2.0 Liter diesels in the NAA* (0.25% of the state vehicle fleet)
  • Excess statewide NOx emissions = 0.22 to 0.65 tons per day 
*The non-attainment area has ozone levels above federal standards. Currently, parts of 9 counties around Denver and the North Front Range are considered non-attainment for ozone. A map of the ozone non-attainment area can be found here.
 
VW Settlement Timeline of Events
*all dates are estimates and are subject to change
 
Event Approximate Time Frame

Court approves the partial settelment

October 25, 2016

Trust takes effect                                          *Wilmington Trust selected as Trustee - March 2017 

Spring-Summer 2017

States elect to become beneficiaries;
States notified of beneficiary designation   

60 days after Trust Effective Date (TED) 

Colorado files a Beneficiary Mitigation 

90 days after being deemed a benificary 

Colorado solicits applications

Fall-Winter 2017 

Colorado may request funds

Fall-Winter 2017 

Colorado begins to receive funds

Early 2018

Please send any comments about Colorado's implementation of the settlement to cdphe.commentsapcd@state.co.us . CDPHE and other agencies are currently developing a stakeholder outreach process to inform the public about the settlement and gather information and ideas. Please check back to this website as we will be updating this page.