Elon Musk Signs Open Letter Proposing Radical Fix to VW's Emission Scandal

A group of prominent green technology investors and advocates sent an open letter (see below) to the California Air Resources Board (CARB) Thursday. Tesla CEO Elon Musk, former eBay President Jeff Skoll, Sierra Club Executive Director Michael Brune, Carl Pope of Inside Straight Strategies and SolarCity CEO Lyndon Rive were among the 45 signatories urging CARB to rethink its plan to recall Volkswagen cars with emissions-cheating software. 

The letter urges the state's emissions regulators to "abandon the plan to force Volkswagen to fix their emissions-cheating cars and instead require that the company put the resources it would take to accomplish that into transitioning to a zero-emissions car company."

The authors of the letter call the plan "costly and impractical." They warn CARB against wasting materials and money, arguing that "a giant sum of money [will] be wasted in attempting to fix cars that cannot all be fixed, and where the fix may be worse than the problem if the cars are crushed well before the end of their useful lives."

Instead, they suggest mandating VW to "accelerate greatly its rollout of zero-emission vehicles, which by their very nature, have zero emissions and thus present zero opportunities for cheating, and also do not require any enforcement dollars to verify," the letter reads.

The authors cite "net greater carbon dioxide emissions, a regulated pollutant" as further reason for CARB not to execute its current plan, along with "compromise[d] performance" of the fixed vehicles. To heed its proposed alternative solution "would be a real win for California emissions, a big win for California jobs and a historic action to help derail climate change."

CARB declined to directly address the letter. “Our focus has and will continue to be cleaning the air and advancing the cleanest vehicle and fuel technologies,” CARB spokesperson Dave Clegern told Newsweek.

Here's the letter in its entirety:

An Open Letter to California Air Resources Board Chairman Mary Nichols

The VW emissions scandal is mainly the result of physics meeting fiction. In the simplest terms, we have reached the point of de miminis returns in extracting performance from a gallon of diesel while reducing pollutants, at least at reasonable cost. Unsurprisingly, and despite having the greatest research and development program in diesel engines, VW had to cheat to meet current European and U.S. standards. Meeting future tighter diesel standards will prove even more fruitless.

For a significant fraction of the non-compliant diesel cars already in the hands of drivers, there is no real solution. Drivers won’t come in for a fix that compromises performance. Further, solutions which result in net greater CO2 emissions, a regulated pollutant, are inappropriate for CARB to endorse. Retrofitting urea tank systems to small cars is costly and impractical. Some cars may be fixed, but many won’t and will be crushed before they are fixed.

A giant sum of money thus will be wasted in attempting to fix cars that cannot all be fixed, and where the fix may be worse than the problem if the cars are crushed well before the end of their useful lives. We, the undersigned, instead encourage the CARB to show leadership in directing VW to “cure the air, not the cars” and reap multiples of what damage has been caused while strongly advancing California’s interests in transitioning to zero-emission vehicles.

The solution we propose for VW and the CARB is to, in a legally enforceable form:

1. Release VW from its obligation to fix diesel cars already on the road in California, which represent an insignificant portion of total vehicles emissions in the state, and which cars do not, individually, present any emissions-related risk to their owners or occupants

2. Instead, direct VW to accelerate greatly its rollout of zero-emission vehicles, which by their very nature, have zero emissions and thus present zero opportunities for cheating, and also do not require any enforcement dollars to verify

3. Require that this acceleration of the rollout of zero emissions vehicles by VW result in a 10 for 1 or greater reduction in pollutant emissions as compared to the pollution associated with the diesel fleet cheating, and achieve this over the next 5 years

4. Require that VW invest in new manufacturing plants and/or research and development, in the amounts that they otherwise would have been fined, and do so in California to the extent that California would have been allocated its share of the fines

5. Allow VW some flexibility in the execution and timing of this plan by allowing it to be implemented via zero-emission vehicle credits.

In contrast to the punishments and recalls being considered, this proposal would be a real win for California emissions, a big win for California jobs, and a historic action to help derail climate change.

The bottleneck to the greater availability of zero emissions vehicles is the availability of batteries. There is an urgent need to build more battery factories to increase battery supply, and this proposal would ensure that large battery plant and related investments, with their ensuing local jobs, would be made in the U.S. by VW.

A satisfactory way to fix all the diesel cars does not likely exist, so this solution sidesteps the great injury and uncertainty that imposing an ineffective fix would place on individual diesel car owners. A drawn out and partial failure of the process will only exacerbate the public’s lack of trust in the industry and its regulators. By explicit design, this proposal would achieve, in contrast, a minimum of a 10X reduction in pollutant emissions as compared to a complete fix.

There is a precedent for this type of resolution. In the industry-wide 1990 diesel truck cheating scandal, the EPA chose not to require an interim recall but instead moved up the deadline for tougher standards to make up the difference. This proposal does the same for VW and ties the solution to a transition to zero emissions vehicles.

We strongly urge CARB to consider this proposal in resolving the VW cheating scandal.

Ion Yadigaroglu, Partner, Capricorn Investment Group; Elon Musk, CEO, Tesla and SpaceX; Jeff Skoll, CEO, Jeff Skoll Group; Dipender Saluja, Partner, Capricorn Investment Group; Carl Pope, Inside Straight Strategies, Chamath Palihapitiya, CEO, Social Capital; Ira Ehrenpreis, Partner, DBL Partners; Hal Harvey, CEO, Energy Innovation; Antonio Gracias, CEO, Valor Equity Partners; Lyndon Rive, CEO, SolarCity; Michael Brune, Executive Director, Sierra Club; Cole Frates, Renewable Resources Group; Ari Swiller, Renewable Resources Group; Lawrence Bender, Producer, An Inconvenient Truth; Reuben Munger, Partner, Vision Ridge; Jigar Shah, President, Generate Capital Angel; Jason Calacanis, Launch Fund Partner; Gregory Manuel, MNL Partners; Adam Wolfensohn, Partner, Encourage Capital; Jason Scott, Partner, Encourage Capital; Martin Roscheisen, CEO, Diamond Foundry; Steve Westly, Former California State Controller; Jules Kortenhorst, CEO, Rocky Mountain Institute; Steven Dietz, Partner, Upfront Ventures; Kevin Parker, CEO, Sustainable Insight Capital; Anja Manuel, Partner, RiceHadleyGates; Larry Lunt, CEO, Armonia; Mindy Lubber, President, Ceres; Tom Darden, Partner, Cherokee Fund; Panos Ninios, Partner, True Green Capital; Jesse Fink, Chairman, MissionPoint; Matt Breidert, Senior Portfolio Manager, Ecofin; Suhail Rizvi, CEO, Rizvi Traverse; Jeffrey Tannenbaum, Chairman, sPower; Rob Davenport, Managing Partner, Brightpath Capital; Stuart Davidson, Chairman, Sonen; Laurence Levi, Partner, VO2 Partners; Rob Day, Partner, Black Coral Capital; Dan Fuller, CIO, Fuller Smith; Nicholas Eisenberger, Partner, Pure Energy; Marc Stuart, CEO, Allotrope Partners; Justin Kamine, Kamine Development; Peter R. Stein, Managing Director, Lyme Timber; Bruce Kahn, PM, Sustainable Insight; and Raúl Pomares, Capital Managing Director, Sonen

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