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Over the past couple of years, the state of California has spent a lot of time and money, first unraveling Volkswagen’s deception on diesel emissions and then working to fix the mess. The state even made sure that VW has to pay a little more penance to the Golden State with settlement requirements such as additional mandated sales of electric vehicles. And now a court document has formally attached a dollar amount due to the California Air Resources Board (CARB) for the cost of it all: $ 60 million.
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The new Third California Partial Consent Decree, subject to final court approval, includes a total fine of $ 93,813,500—a civil penalty with payment due in 30 days—and another $ 60 million in “cost recovery” to reimburse the state for its expenses.
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The $ 60 million tally that California attributes to the diesel scandal includes engineering and tech time, laboratory analysis, and legal expenses, as well as some anticipated future expenses for making sure that VW complies with all terms of the settlement. The agreement also includes new compliance programs, audits, and additional vehicle testing for Volkswagen, all to make sure it won’t happen again.
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Some of these expenses can be traced back to 2011, when CARB first learned there was a discrepancy between the Volkswagen diesel vehicles’ in-lab performance and their real-world emissions. However, the bulk of the California agency’s expenses started in 2015, when scientists at the International Council on Clean Transportation (ICCT) and West Virginia University found results that suggested a defeat device was in play.
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“At the point where we actually figured out what they were doing, it became more intensive,” said Dave Clegern of CARB. “It’s a lot of money, a lot of staff time, a lot of weekends and nights. The hours involved were amazing.”
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Still No Fix for the Largest Group
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Under the $ 14.7 billion settlement covering 475,000 four-cylinder TDI vehicles (separate from the $ 1.2 billion settlement for the V-6 and the cost of fixes still due on some of them), the older, 2.0-liter four-cylinder TDI models labeled as Gen 1—the largest single group of affected diesels—remain without an approved remedy. Regulators have already admitted that whatever fix is applied won’t bring the cars entirely within regulatory compliance.
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“This payment to the State of California closes another chapter in the so-called ‘dieselgate’ case against Volkswagen, but it is not the end of the story,” said CARB chair Mary Nichols. “There are still consumers waiting to find out the future of their cars. CARB is working with the U.S. EPA to determine if the remaining vehicles can be modified.”
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Cumulatively, the scandal has cost Volkswagen up to $ 24 billion in North America alone, according to the Financial Times, and as CARB outlines, VW’s obligation to right those wrongs includes $ 422 million toward an environmental mitigation trust, $ 800 million toward a structured multistage Zero Emission Vehicle (ZEV) investment plan, $ 25 million in other ZEV investment programs, and $ 86 million in civil penalties. That’s all in addition to the mammoth restitution, modification, and buyback programs and the additional mitigation payments that would be due if VW fails to fix or buy back at least 85 percent of affected TDI models.
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- Electric Charge: Here’s Volkswagen’s Launch Strategy for Its Mandated EVs
- What Is VW Going to Do with All Those Bought-Back TDIs?
- Everything You Need to Know about the VW Diesel-Emissions Scandal
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CARB is slated to revisit one such public-service project, the mammoth Green City scheme for Sacramento. It’s the first large-scale proposal under Volkswagen’s Electrify America organization, which is responsible for divvying out $ 2 billion of settlement money nationally (including the $ 800 million for California) over 10 years, to be spent on promoting green energy and electric cars. Although the proposal earlier this year was rejected, it has been supplemented recently with a second proposal that includes more detail about getting electric vehicles into low-income communities and specifics about how it will deploy hydrogen fuel-cell technology. If there’s one thing the diesel scandal has enforced about CARB, it’s that the organization’s tenacity should never be underestimated.
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