End of the road for diesel cars?

Viewed from the United States, Volkswagen’s “Dieselgate” scandal is a tale of massive legal settlements but minor environmental impacts. VW agreed last October to a $14.7 billion settlement with diesel car owners, plus $4.3 billion in fines. Just last week, VW agreed to pay another $1.2 billion to owners of larger VWs, Audis and Porsches. Lawsuits from state attorneys general and shareholders are still pending.

Despite the staggering payouts, the VW diesels played only a minor role in U.S. air pollution. Studies led by the Massachusetts Institute of Technology and Northwestern University put the health cost of the VW cheating at $0.04 to $0.45 billion. The higher numbers assume a worst-case scenario that VW diesel cars were consistently emitting 40 times the Environmental Protection Agency (EPA) limit for nitrogen oxides, the high end of West Virginia University measurements.

In human terms, that means the faulty diesels caused up to 60 U.S. deaths since 2009. That’s a tiny share of the roughly 200,000 U.S. deaths per year caused by air pollution, out of 7 million globally.

Cheating is cheating, and merits VW’s guilty plea to criminal charges. But the direct effect on air quality and the U.S. auto market will be small, since diesel cars were just 1 percent of the U.S. vehicle fleet before the scandal.

{mosads}The scandal has far different ramifications in Europe. There, the payouts are smaller, but the impacts on air quality and the auto market could be far larger. Diesels dipped below 50 percent of new car sales in the aftermath of the scandal, but still lead the market in many European countries.

Diesel cars rose to prominence in Europe because they use less fuel than gasoline ones, and thus emit less planet-warming carbon dioxide. But diesels produce more pollutants that directly harm human health: nitrogen oxides and particulate matter.

Tough emissions regulations and modern control technologies have aimed to slash those emissions. Both the U.S. and Europe have tightened their vehicle emissions standards by over 90 percent since the 1990s.

However, studies show that diesel cars emit far more nitrogen oxides than allowed by the new Euro 6 standards. And it’s not just a Volkswagen problem. By some accounts, 97 percent of diesel cars exceed the Euro 6 standards under real-world driving conditions.

These excess emissions are causing major air pollution problems in cities where diesels are prevalent. The annual limit for nitrogen dioxide was exceeded within the first five days of 2017 in London, where the pollutant is estimated to kill 5,900 people per year. More broadly, nitrogen dioxide in the biggest cities of Europe is roughly double the level of those in the U.S., mostly due to Europe’s higher prevalence of diesel cars.

There’s no simple fix for diesel car emissions. Sophisticated control technologies can be rolled into the cost of large diesel trucks and buses, but would make diesel cars too costly for competitive auto markets.

That’s why many small diesels now emit more nitrogen oxides per mile than diesel buses and trucks. VW has yet to find a cheap and effective solution, and is scrapping most of its faulty diesels in the U.S. rather than repairing them. Ironically, the software VW used to cheat on nitrogen oxide emissions actually helped boost power and efficiency, so a fix may worsen fuel economy.

Mercedes-Benz controls nitrogen oxides with a costlier BlueTEC technology that relies upon a urea tank that must be refilled periodically. But even that is being investigated for emissions violations.

Leaders of polluted cities aren’t waiting for cleaner diesel technologies to appear. Instead, the mayors of Madrid; Paris; Athens, Greece; and Mexico City have pledged to ban diesel cars by 2025. Activist groups seek a ban in London as well. Oslo issued a temporary ban during an air pollution episode this January. All of this could lead car buyers to shun diesel cars that could become undrivable in major cities.

Diesel’s woes will at first be a boon for gasoline car sales. But there’s a reason Europe turned to diesels in the first place: better fuel economy. Countries across the Americas, Europe and Asia have set tightening fuel economy standards to be enacted over the next decade. Shifting from diesels to less efficient gasoline cars would compound the challenge of meeting those standards.

All of this could open the door to faster adoption of electric or hydrogen fuel cell cars. With diesel emissions costly to control and battery technologies becoming better and cheaper, VW expects electric cars will reach cost parity with diesels by 2023 or 2025. Lower fuel and operating costs could make electric cars the low-cost choice even sooner.

Auto manufacturers are setting their sights on a radically changed market. Volkswagen aims to produce 30 new electric car models by 2025. Audi expects one-quarter of its sales to be electric within 10 years. Toyota is pursuing both electric car and hydrogen fuel cell technologies.

As I wrote previously, the Energy Information Administration has already upped its forecasts for 2020’s electric car sales by a factor of 10 in the United States. That’s because improved technologies and plunging prices are making electric cars an increasingly viable option for many consumers. In Europe, diesel’s woes could accelerate the shift toward electric or hydrogen vehicles. The shift will be further propelled by policies in countries like Norway, which seeks to ban oil-powered cars by 2025.

Some analysts already foresee the demise or slow death of diesel as a fuel for passenger cars, even as it remains the dominant fuel for buses, construction equipment and heavy trucks. This won’t be a big deal immediately in the U.S., where the VW scandal has already shattered the niche market for diesel cars.

But if diesel’s decline propels the shift toward hydrogen or electric cars in Europe, those technologies will likely proliferate to the U.S. and beyond. The shift could also have severe implications for factories connected to the manufacture of diesel cars.

In sum, the ultimate legacy of Volkswagen’s Dieselgate lies less in the illegal emissions being remedied in the U.S. than in what it portends for vehicle technologies globally. The discovery of cheating in a niche market here could be a harbinger for a profound shift in the cars driven in Europe and eventually here as well.

Dan Cohan is an associate professor in the Department of Civil and Environmental Engineering at Rice University.

The views of contributors are their own and not the views of The Hill.