14.0 Accelerated Vehicle Retirement

Program to encourage the voluntary removal from use and the marketplace of pre-1980 model year light-duty vehicles and pre-1980 model light-duty trucks.
Section 108 (xvi), CAAA

Introduction

Accelerated vehicle retirement, or vehicle scrappage, involves an offer to purchase older vehicles having high emission rates to remove these vehicles from the active vehicle fleet in an area. The program operates by an organization, usually private, paying a fee to owners of older, high-emission vehicles who voluntarily turn in their vehicle. The vehicle is then scrapped, removing it from use. The fee for the vehicle, also called a bounty, is usually a fixed price per scrapped vehicle although different amounts can be offered for different model years. Individual vehicle emissions characteristics might also be used as a criterion for scrappage.

Main Components

A scrappage program requires a funding source before it can be initiated. Public agencies may find this initial cost prohibitive, either in amount or difficulty obtaining approval. Private companies looking to offset emissions elsewhere in their company with the emissions reductions from the program may implement scrappage programs.

According to the EPA Office of Mobile Sources, vehicle retirement programs can be made more cost-effective by linking them to regional programs that are designed to measure the emissions of individual vehicles, such as inspection and maintenance (I/M) programs and remote sensing programs. The advantage of this linkage is that vehicles can be screened to help ensure that only vehicles that emit above the applicable standards and cannot be repaired at reasonable cost are scrapped.

Other Considerations

The cost-effectiveness of a scrappage program is likely to decline over time as the pool of older, high-emission vehicles is reduced. Vehicle owners wishing to participate may hold onto their vehicles and scrap them at the end of a continuous or long-running program. The program is more effective if limited in duration.

The amount of the bounty is a critical variable in a scrappage program. If the bounty is too low, the program will not attract enough vehicles to have any real impact on air quality. If the bounty is too high, the program will attract vehicles that are newer and cleaner, which would limit the program’s overall impact and reduce its cost-effectiveness. Also, the program would not be able to remove as many vehicles out of the fleet. For the most part, actual scrappage programs have offered somewhere between $500 and $1000 per scrapped vehicle, with the most common bounty being $700.

Vehicle eligibility for scrappage programs must be well defined. A basic criterion is vehicle age and/or model year. The vehicle should also be operational. Requiring that it be driven to the program site ensures this criterion. Registration of the vehicle should reflect origin within the program area so that emissions reductions are actually achieved in the area.

The costs of an accelerated vehicle retirement program to the implementing agency are equal to the bounty price per vehicle, plus any administrative costs per vehicle, multiplied by the number of vehicles scrapped by the program.