Tier 4 Translated

The EPA’s emissions regulations have reached the Tier 4 Final stage. What that means for the future of off-road machinery.
By Jordan Snyder

Tier 4 Final is a stage of the Environmental Protection Agency’s (EPA) plan to reduce emissions from off-road diesel engines that has been looming large over the heads of those in the construction, agriculture and heavy machinery business for some time. As of January 2015, Tier 4 Final regulations became absolutely mandatory for all new machinery, such as bulldozers, tractors and wheel loaders. These new regulations to reduce the amount of particulate matter, nitrogen oxides, carbon monoxide and hydrocarbons have been a long time coming.

Way back in 1996, the EPA introduced their plans to reduce harmful emissions with strict new rules for diesel engines. Because these new regulations would require additional exhaust after-treatment components, thus driving up the cost of production, they laid out a plan to slowly tighten restrictions over the course of a few years to make sure they are not economically disruptive. With that, the Tier system was born, starting at Tier 1 culminating into Tier 4 Final.

Though those in the industry have been hearing about the restrictions for years, preparing themselves for what’s to come, it’s easy to be a little fuzzy on the details. What exactly is the EPA trying to reduce?
How are manufacturers meeting standards? Will this change how I do my job? How is this going to affect my business? How will it affect the industry as a whole? Are the benefits really worth it? All valid questions, the answers to which seem to get buried under thick layers of government jargon. So, to make things a little easier, we are clarifying it for you. Here is everything you need to know about Tier 4 Final and the EPA‘s off-road diesel emission regulations.

What is the EPA trying to reduce?
The EPA is a product of The Clean Air Act, and its sole purpose is to monitor air quality and eliminate threats to human health. With that in mind, they targeted these four emissions:

Particulate matter (PM)
Particulate matter is a mixture of solid particles and liquid droplets found in the air that is formed in diesel engines during the combustions process. When inhaled, they can cause serious health problems such as irregular heartbeat, aggravated asthma and decreased lung function. Particulate matter also contributes to reduced visibility (haze) in many parts of the United States.

Nitrogen Oxides (NOx gasses)
NOx gases are formed when fuel is burned with excess air. They contribute to acid rain and smog and can cause lung problems such as bronchitis and emphysema when inhaled. NOx gasses are also considered greenhouse gasses which can contribute to the Earth’s rising temperatures.

Hydrocarbons are gaseous compounds that result from unburned fuel and lubricating oil. By themselves, hydrocarbons don’t cause harmful effects. However, they go through a chemical reaction in the presence of nitrogen oxides and sunlight, causing a photochemical reaction that results in smog. Smog causes irritations in the eyes and lungs and can lead to respiratory diseases.

Carbon Monoxide (CO)
Carbon monoxide is the colorless and odorless gas that is produced when carbon in fuel isn’t burned completely. While it is one of the weaker greenhouse gases, the influence it has on the climate goes well beyond its own direct effects. The presence of CO affects concentrations of other greenhouse gases including methane, tropospheric ozone and carbon dioxide, making them stronger. In addition to that, CO has harmful effects on humans, reducing the oxygen delivery to the body’s organs like the brain and the heart.

How are manufacturers meeting the EPA’s standards?
If you were to compare the emissions from diesel engines created during the implementation of Tier 1 and the emissions from today’s diesel engines under Tier 4 Final, it would take 25 Tier 4 Final engines to equal the emissions of just one Tier 1 diesel engine. A reduction that large takes an astounding amount of technological innovation, and manufacturers all over the globe stepped up to the plate to meet the demand. Here are the implements that manufactures used to meet the EPA’s standards while offering customers machinery that’s more efficient.

Exhaust Gas Recirculation (EGR) circuit
This after-treatment component attached to the exhaust system was first introduced around the time that Tier 3 took effect. This add-on is meant to reduce NOx emissions by recirculating a portion of the exhaust gas with fresh intake air and reduce the amount of oxygen in the combustion chamber. When the oxygen-reduced air ignites on the compression stroke, the exhaust contains less NOx. This add-on didn’t change much of the engine, however, recirculating hot gas can increase temperatures, so some manufacturers increased their engine’s overall cooling systems as well.

Diesel Oxidation Catalysts (DOC)
Diesel oxidation catalysts are filters with a catalytic coating that chemically changes carbon monoxide, hydrocarbons, diesel particulates and other pollutants into carbon dioxide and water. Engines with lower horsepower were able to meet Tier 4 Final regulations with just a DOC, but many had to use them in conjunction with a diesel particulate filter.

Diesel Particulate Filter (DPF)
While most machinery would be able to get hot enough to burn off the particulate matter trapped in the DOC, cold starts, light loads and idling can increase particulate matter accumulation. Diesel particulate filters are large, honeycombed ceramic filters coated with precious metal catalysts that trap particulate matter in exhaust streams. When the DPF becomes full enough to affect backpressure, the engine control module (ECM) will inject a stream of diesel fuel into the DPF to raise the temperatures and burn off residual particulate matter in a process called regeneration.

Some systems start this process automatically, while others are connected to an alert light that will let the operator know they need to activate the regeneration system. One downside to the implementation of this filter is that ash does not naturally burn off and will collect in the DPF, requiring the operator to either replace the filter or have it cleaned by a certified DPF service center. However, the EPA requires that filters sized for engines above 175 horsepower must last for a minimum of 4,500 hours between cleanings and 3,000 hours for engines below 175 horsepower.

Selective Catalytic Reduction (SCR)
The Tier 4 Final stage called for a drastic cut in NOx levels, and for most engines, that was more than the EGR could handle. So manufacturers installed a new exhaust after-treatment system to get the job done. The selective catalytic reduction system requires exhaust to pass through the DPF, into a catalytic chamber and then douses it with diesel exhaust fluid (DHF), which is a combination of water mist and a common chemical used in commercial fertilizers called urea. The mixture of the exhaust and the DEF in the presence of the catalyst then turns the dangerous NOx into water and nitrogen. This technology has been used in on-road trucks since 2010 and takes the brunt of the work from the EGR, making the engine run cooler.

However, there are also disadvantages, as the implementation of the SCR will increase the amount of maintenance required to keep the engine running at full power. Operators must keep a close eye on their DEF levels and refuel the tanks on their equipment frequently. If the engine runs out of DEF, they are programmed to slowly downgrade the power output until they’re at the point where they no longer operate. Running out of DEF can be just as disruptive to operations as running out of diesel.

Ultra Low Sulfur Diesel (ULSD)
The catalysts used in the DOCs and SCR couldn’t handle the higher levels of sulfur found in diesel, so ultra low sulfur diesel was introduced into the marketplace in 2009. Today, ULSD is the only type of diesel that you can purchase, but the fact that newer engines can only burn this type of diesel may have an impact on the resale value of older machinery within the United States.

How does this affect resale value?
Now that all compliant off-road diesel engines are on a strictly low-sulfur diet, many assume that the resale value of any machinery that doesn’t take ULSD is going to plummet. While this may be true for selling machinery in markets like the United States and Japan, there are many other countries where ULSD is not yet available. To address that issue, many manufacturers also produced “de-tiering kits” which require six to eight hours of labor and a computer software upload for conversion, but will allow the use of any type of diesel fuel on newer machinery.

Tier 4 Final regulations require many upgrades to diesel engines. These upgrades, in addition to the research and development costs that went in to creating compliant machinery, the price of off-road diesel machinery has risen between 8 and 25 percent. Add the cost of a de-tiering kit on top of a machine that’s already pricier to meet regulations that a buyer’s country doesn’t have in place and it’s easy to see why Tier 4 Final regulations would actually cause an increased demand for older, non-compliant machinery in areas without ULSD like Latin America and Africa.

What impact does it have on the rental industry?
Tier 4 regulations posed a real problem for people in the rental industry. Machinery that is Tier 4 Final compliant costs more money up front, which means many would be forced to raise the rental prices to make sure they get a return on their investment. However, they also had to deal with competitive pressure from other rental companies willing to rent for a lower cost. If they purchased a fleet of Tier 4 Final compliant machinery and had to auction a portion of it off, they’d run in to financial trouble there too. Roughly a third of the used machines sold by national rental companies are sold at auction with a large amount of them going to overseas buyers. If the owners wanted to increase their chances of selling newer machinery overseas, they’d have to shell out the cash to have it de-tiered beforehand.

However, there’s another side to this issue. According to an in-depth research report from Manfredi & Associates called Quarantined Markets: A Study of the Impact of Emission Regulations on Equipment Sales and Prices equipment users will work to avoid purchasing newer, Tier 4 Final compliant equipment for as long as they can. Opting to instead rebuild their Tier 3 machines and search the market for good used Tier 3 machines to add to their fleet. While that may be bad news for manufacturers of newer equipment, it’s good news for rental companies. Many contracts will requires Tier 4 Final certified machinery be used while building, especially on federally funded jobs. Equipment owners not willing to pay the higher prices of Tier 4 Final machinery, who are unsure about the operating costs and the resale value, will have no choice but to turn to rental companies for the right equipment. So while it may seem like a lot of up front capital for many companies, Tier 4 Final regulations will benefit the rental industry in the long run.

How have these regulations benefited us?
Since Tier 4 Final regulations started, our annual emission reductions are estimated at 738,000 tons of NOx and 129,000 tons of particulate matter. The EPA estimates that by the year 2030, 12,000 premature deaths will have been prevented thanks to the implementation of these standards. However, when it comes to making the machines that are vital to many industry professionals more expensive, it’s hard to get on board. But as many manufacturers will tell you, these regulations have not only improved our health, they’ve improved our engines tenfold as well.

To provide better fuel combustion and throttle response, manufacturers have fine-tuned the fuel-air mixtures with different turbocharger designs. Fuel systems have largely gone to a high-pressure common rail design, with pressures as high as 30,000 psi or more. Electronic engine control modules have allowed for ultra-high speed, ultra-precise fuel injection sequences. Fluid efficiency, including diesel exhausted fluid consumption, has increased by five percent between Tier 4 Interim and Tier 4 Final alone. With fuel consumption being the driving cost of operation for most off-road vehicles, a fuel efficiency increase of just one or two percent translates to tens of thousands of dollars per year in operator savings.

“We’re able to burn every drop of fuel inside the engine instead of sending it out as particulate matter, which translates into a five percent fuel savings across the board on the Tier 4 Final engines, which translates into a five percent cost savings for end user,” said David Hahn, Manager of Power Train PST for Volvo Construction Equipment in a press release.

What lies in the future of emissions regulations?
As it stands now, this is the last step in the EPA’s long journey to reduce emissions and protect the health of the public. However, many industry experts expect a set of Tier 5 regulations in the near future.

The reason for this is that America and Europe’s regulations have been nearly identical for decades, the only major difference being nomenclature. The European equivalent of Tier 3 was Stage III, Tier 4 Interim was Stage IIIb and Tier 4 was Stage IV. However, Europe has continued on to Stage V, with the EPA still assuring engine manufacturers that they don’t have any plans to tighten emissions regulations any further than Tier 4 Final.

While at first glance these regulations seem like nothing more than an expensive hassle, the impact they’ve had on the quality of off-road engines and our quality of life is clear. So regardless of whether or not the EPA decides to roll out Tier 5 regulations after a few years, the impact that the last few years have had on the quality of our engines and our quality of life is undeniable. The bottom line is clear as day: in the long run, everyone benefits from reduced emissions in some way.

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