EMA Regulatory Alert: EPA Proposes Major Changes to DEF "Derates"
This week, EPA proposed substantial changes to the way diesel engines respond when they detect low diesel exhaust fluid (DEF), poor-quality DEF or possible tampering with selective catalytic reduction (SCR) systems.
The DEF provisions are part of a much broader EPA proposal addressing model year 2027 and later heavy-duty diesel-engine emissions requirements. The larger rulemaking would revise emission-related warranty periods, delay certain extended useful-life requirements, authorize nonconformance penalties for some medium- and heavy-heavy-duty engines, amend testing and diagnostic provisions, and revise requirements for SCR-equipped highway and nonroad engines. EPA is not proposing to repeal the underlying model year 2027 nitrogen-oxide and particulate-matter standards.
Current SCR systems commonly use "inducements" or "deratements" — progressive reductions in engine power or vehicle speed — to compel operators to refill the DEF tank or correct an emissions-system problem. EPA acknowledges that derates have caused operational and safety problems for truckers, farmers, motorcoach operators and other diesel-equipment users. Defective sensors, corroded wiring and diagnostic errors can trigger derates even when the operator has used proper DEF and has not tampered with the system.
Under the Agency's proposal, original equipment manufacturers generally would replace DEF-related engine and speed derates with visible and audible warnings. For a low-DEF level, a 90-second alarm would begin approximately three hours before the tank is empty (or when the tank reaches 2.5 percent full), repeat 30 and 60 minutes after the tank runs empty, and then repeat hourly. Poor DEF quality or suspected tampering would trigger a separate, less frequent warning. Derates would not disappear entirely, as manufacturers could still apply a derate where continued operation would damage the engine or aftertreatment system, and any optional speed reduction would have to phase in gradually — no more than one mile per hour every five minutes. EPA is seeking comment on all aspects of the proposed inducement changes, including whether the proposed warnings are sufficient.
The warning-based system would become mandatory for new engines no later than model year 2029, although manufacturers could adopt it earlier. EPA also proposes requiring engines to compensate for reasonable variations in DEF concentration and generally would not require a DEF-quality warning unless urea concentration falls below 20 percent, compared with the normal 32.5 percent concentration.
For EMA members that sell DEF, the proposal likely would have limited direct effect on overall DEF demand. Trucks and equipment would still require DEF for SCR systems to meet emissions standards, and operators would remain responsible for maintaining an adequate supply of commercially available, properly formulated DEF. Indeed, EPA says that DEF is now widely available and that operators routinely purchase it when refueling with diesel.
The commercial effects are therefore more likely to involve purchasing patterns than total consumption. Fewer sudden derates could reduce emergency purchases of packaged DEF made solely to restore vehicle operation. At the same time, fewer false failures and less operator frustration may discourage tampering and could reinforce routine DEF use, potentially supporting pump, bulk and regularly scheduled DEF sales.
Some industry groups are questioning EPA's proposal, stating that eliminating mandatory derates will invite consumer confusion and threatens to decrease DEF's availability and increase its price, and adding that EPA should instead allow its 2025 and early-2026 guidance — software updates, NOx sensors in place of urea-quality sensors, and adjusted derate schedules — to take effect before fundamentally altering the regulatory backdrop for DEF.
Comments are due by August 29, 2026, and EPA will hold virtual public hearings on July 29 and 30, 2026.
EMA Regulatory Alert Reminder: FMCSA to Propose Rule Establishing English Language Proficiency Non-Compliance as an Out-of-Service Violation
EMA has been tracking federal developments on English Language Proficiency (ELP) requirements for commercial drivers since President Trump's Executive Order 14237 directed FMCSA to rescind prior guidance that had allowed a more lenient approach to enforcement. Since then, FMCSA has actively enforced the longstanding ELP qualification requirement under 49 CFR § 391.11(b)(2), which requires that CDL holders be able to read and speak English sufficiently to converse with the general public, understand highway traffic signs and signals, respond to official inquiries, and make entries on reports and records. Thousands of drivers have faced scrutiny under the renewed enforcement push, with the Western and Southern regions reporting the highest number of violations.
New Rulemaking on the Horizon
FMCSA has now signaled the next step. The Administration's Unified Regulatory Agenda includes a forthcoming proposed rule that would formally examine whether English Language Proficiency non-compliance under 49 CFR § 391.11(b)(2) should be codified as an out-of-service (OOS) violation.
This is a significant development. Under the current framework, ELP deficiencies identified at roadside inspections can result in enforcement action, but there is no formal OOS designation tied to the regulation. Codifying ELP non-compliance as an OOS criterion would mean that a driver found unable to meet the proficiency standard during a roadside inspection would be immediately removed from service — prohibited from operating a commercial motor vehicle until the violation is resolved. Additionally, codification would make it more difficult for another administration to provide flexibility.
For fuel marketers and distributors who depend on a pool of qualified commercial drivers, an OOS designation carries immediate operational consequences: a driver placed out of service cannot complete a delivery, which can disrupt fuel supply chains, increase costs, and create scheduling and coverage challenges across a fleet.
EMA Requests Input
Fuel distribution operations are driver-dependent, and the CDL driver shortage is already a significant operational challenge for many EMA members. An OOS designation for ELP non-compliance would add a new enforcement risk dimension to every roadside inspection, with the potential to pull drivers off the road mid-route. The impact could be particularly acute in regions with higher concentrations of non-native English-speaking drivers or where carriers rely on drivers with varying degrees of English proficiency.
EMA is monitoring this rulemaking closely. No proposal has been published yet — the Unified Regulatory Agenda listing signals that a proposed rule is being developed, but the text and specific requirements are not yet available. EMA will evaluate the proposal carefully once it is published and determine whether formal comments are warranted. To support EMA, please share your thoughts on the following:
Has the renewed ELP enforcement push already affected your operations or driver pool?
Would an OOS designation for ELP non-compliance create significant operational disruptions for your fleet?
If your operations could be affected, would enhanced driver training protocols be a feasible mitigation measure — and how burdensome would implementing such protocols be?
Any other feedback or observations you would like EMA to consider?
Please share your feedback with EMA at jroman@bmalaw.net. State executives are especially encouraged to weigh in based on what they are hearing from members in their markets. Your input will directly inform EMA's engagement on this rulemaking.
EMA Joins Coalition in Support of DOE’s Revised Home Energy Rebate Guidance
This week, EMA joined a coalition of industry groups in commending the U.S. Department of Energy (DOE) for issuing revised guidance on the Inflation Reduction Act’s Home Energy Rebate programs. In a joint letter, the coalition—which includes the American Public Gas Association, American Supply Association, Hearth, Patio & Barbecue Association, National Energy & Fuels Institute, National Propane Gas Association, Organization of Energy Service Professionals, and the Plumbing-Heating-Cooling Contractors—praised DOE for adopting key recommendations the group submitted in February 2025.
The updated guidance introduces several important improvements:
High-Efficiency Electric Home Rebates may no longer be used to subsidize the replacement of non-electric heating systems and appliances.
Homeowners who install a heat pump can retain their existing heating system rather than being required to remove it.
Upgrades to existing electric equipment and installations in new construction remain fully eligible.
DOE withdrew its earlier “Envelope First, Heat Pump Ready” recommendations, restoring fuel neutrality to the program. As a result, high-efficiency oil, propane, and natural gas equipment can now qualify for rebates based on demonstrated energy savings.
The ENERGY STAR certification requirement has been made optional, allowing high-efficiency liquid- and gas-fired furnaces, boilers, and water heaters to participate without being excluded.
Weatherization is now prioritized as the first step to reduce a home’s overall energy use, eliminating the previous guidance’s bias toward electrification and against non-electric heating options.
The coalition welcomed these changes as a more balanced and practical approach that gives homeowners greater flexibility and supports a wider range of high-efficiency technologies.
The House Energy and Commerce Committee’s Environment Subcommittee recently advanced a series of bills focusing on diesel emissions and critical mineral recovery. While Republicans, led by Chair Brett Guthrie (R-KY), argued these measures balance economic growth and national security with environmental health, Democrats expressed concern that several air-related bills would undermine clean air protections and increase fuel consumption. Among the measures, only the Diesel Emissions Reduction Act (DERA), which reauthorizes funding for retrofitting old diesel engines through 2029, received broad bipartisan support. Additionally, the Diesel Engine Flexibility (DEF) Act (H.R.9618) sought to codify eased rules for diesel engines with pollution control issues, a move Republicans framed as providing long-term certainty, but Democrats criticized. Conversely, the subcommittee found common ground on legislation aimed at bolstering the domestic supply chain for critical minerals through recycling and reclamation.
EMA, along with a coalition of other main street business associations, sent a letter to Senate leaders John Thune (R-SD) and Charles Schumer (D-NY), urging the swift passage of the Common Cents Act (H.R. 3074). This legislative push follows the House of Representatives’ bipartisan approval of the bill on July 14, 2026. The coalition, representing industries ranging from retail and restaurants to hospitality and energy, emphasizes that businesses require immediate clarity to continue serving their communities fairly and efficiently. Since the US Treasury has ceased minting of the penny, many businesses have met challenges in managing cash transactions without exact change. Currently, businesses face significant operational uncertainty, financial losses, and the risk of legal challenges. Furthermore, a lack of federal guidance has led more than 15 states to enact their own rounding laws, creating a confusing patchwork of regulations for both merchants and customers. To resolve these issues, the coalition advocates for the Common Cents Act as a way to establish a clear national standard for rounding cash transaction amounts. The act would also provide businesses with a safe harbor from liability, provided the rounding is conducted fairly. By passing this legislation, the Senate would provide the consistency and certainty necessary for everyday commerce to proceed without further interruption.
The Trump Administration is currently debating a third extension of Jones Act waivers to allow foreign-flagged vessels to transport essential commodities, including oil, fuel, and fertilizer, between U.S. ports. This consideration is primarily driven by rising energy prices and potential supply disruptions resulting from renewed conflict with Iran. While the administration views these waivers as a vital tool to increase shipping capacity and lower domestic crude prices, which have reached approximately $80 a barrel, no final decision has been made regarding an extension beyond the current August 16 expiration date. To manage these pressures, the White House has also leaned on other measures, such as loaning oil from the Strategic Petroleum Reserve, which is currently at its lowest level since 1983. To mitigate criticism from the maritime industry and Republican allies, officials are considering implementing geographic restrictions to limit where foreign ships can operate. The century-old Jones Act typically requires goods moved between domestic ports to be carried on vessels that are American-built, owned, and crewed. Consequently, the waivers have sparked a significant political challenge, with critics like House Speaker Mike Johnson (R-LA) arguing that the policy undermines the U.S. maritime industry and weakens national security. While the White House maintains that the waivers have been decisive in preventing supply chain shortages, opponents dispute their actual impact and warn of potential long-term harm to domestic shipbuilders and American crews.
House Republican leaders are preparing to release a blueprint for "reconciliation 3.0," a third party-line budget bill that notably excludes previously anticipated energy provisions. Despite earlier expectations that the legislation would include energy-related provisions such as oil and gas lease authorizations and permitting reforms to offset new spending, key committee chairs like Bruce Westerman (R-AK) of Natural Resources and Brett Guthrie (R-KY) of Energy and Commerce have not been asked to draft language for the bill. This omission is a shift from earlier proposals by the Republican Study Committee that sought to roll back energy efficiency standards and overhaul federal rulemaking. The current framework for the legislation is expected to focus primarily on defense spending and agricultural aid, with approximately $67 billion envisioned for defense and $11 billion for farmers. Additionally, the bill is likely to include a new grant program for election security, incentivizing states to implement voter ID and citizenship requirements for federal elections, a move intended to satisfy demands from conservative lawmakers and the White House for provisions similar to the SAVE America Act.
EMA's Fall Meeting at the NACS Show 2026: October 5-6: Website and Registration Open!
Get ready for an exciting and productive EMA Fall Meeting, held alongside the NACS Show! Connect with industry leaders, gain valuable insights, and celebrate excellence at the Wynn Las Vegas!
Event Highlights:
Oct 5, Afternoon: Kick off with a New Attendee Orientation & Federal Legislative Update to get up to speed on key issues.
Oct 5, Evening: Join the EMA/NACS Reception Salute to State Association Executives at the Wynn/Encore Chopin Patio sponsored by Altria and PMI.
Oct 6, Morning: Start your day with a Buffet Breakfast, followed by Region and Committee Meetings to collaborate and strategize.
Oct 6, Afternoon: Celebrate at the Distinguished Service Award Luncheon, honoring former Kentucky/Ohio Marketer and EMA Past Chair Jeff Lykins, proudly sponsored by Federated Insurance. The EMA Board of Directors Meeting will follow.
Register now in the link below and be part of the EMA Fall Meeting at the NACS Show. We look forward to seeing you in Las Vegas! For more details, visit the website.
An invitation was sent to your inbox on July 16. Responding to the links on the invitation email is the recommended way to register. Sunday, October 4, 8 rooms are available, for Monday, October 5, 30 rooms are available, for Tuesday, October 6, 32 rooms are available and for Wednesday, October 7, 33 rooms are available so please do not delay in making plans click the link below! Members have access to all other hotels with availability in the block. If the general block has rooms, you will continue to see those options.
| Click Here for EMA's Fall Meeting at the NACS Show Information! |
Remember, the NACS Show registration is separate from EMA's Fall Meeting registration.
Special EMA Members Code for NACS Show 2026 Registration
Using the EMANS2026 code provides EMA with $100 for every retailer or marketer paid registration at any rate. EMA encourages EMA state execs to promote and share with your state association's member companies. Click here for the flyer.
**Please note that EMA State Execs are comped for NACS Show registration. Additionally, the NACS Show registration is separate from EMA's Fall Meeting registration.
Questions registering for NACS Show? Contact NACS Show registration customer service at nacs@maritz.com or 469-513-9489, Monday-Friday, 9:00 a.m. - 5:00 p.m. EST, for assistance.
| Click Here to Register for the NACS Show |
PAC Raffle Being Held During EMA’s Fall Meeting at the Wynn Las Vegas to Win a MacBook Air
Get your Energy Marketers of America Small Business Committee (SBC) PAC raffle tickets now for a chance to win a MacBook Air. The EMA PAC will hold a raffle during the Las Vegas, NV conference on October 5-6. The raffle winner will be identified on October 6, and the winner does not have to be present to win. If you are not attending the conference and you are the raffle winner, you will be notified the week following the October drawing.
MacBook Air with the M5 chip brings blazing speed and powerful AI capabilities into an incredibly portable design. With Apple Intelligence, up to 18 hours of battery life, and fast SSD storage starting with 512GB, you can work, create, and play anywhere life takes you.
The proceeds of the raffle will benefit the EMA SBC PAC. The money distributed to the PAC is used to benefit federal legislators who support the industry and have a solid record on key industry legislative issues.
Tickets are $25 each or five for $100. Advanced tickets for the MacBook Air are available for purchase until October 1. Ticket sales will continue at the EMA’s conference in Las Vegas until the drawing on October 6. Tickets must be paid for with personal funds by MasterCard, VISA, American Express, cash (cash cannot exceed $100 due to Federal regulations) or check, which should be made out to the EMA SBC PAC. To purchase tickets before October 2, please email completed PAC Raffle flyer to Sabrina Pitcher.
Californians hate Gavin Newsom’s gas vehicle ban, poll shows | New York Post
Middle East allies rushing new pipelines, port to bypass Iran’s grip on Strait of Hormuz | NY Post
Gas Prices Will Stay Higher for Longer, Even if Oil Falls | WSJ
Trump-hyped Freedom Fuel prices in Camp Hill disappoint customers | Evening Sun
US supporting efforts to revive Iraq-Syria crude oil pipeline, US official says | MSN
White House weighs extending Jones Act waivers as Iran conflict raises price concerns | MSN
Federated Insurance Employment Practices Network HR Question of the Month
Federated Insurance’s HR Question of the Month focuses on employment-related practices liability issues. This month’s question is: Summer Office Parties. Since our work slows down during the summer, we would like to host a couple of office parties for our employees—maybe one for the Fourth of July and maybe another one just for fun. We want to show our employees that we appreciate all their hard work. What are some general considerations we should be aware of? We are planning to serve alcohol.
Office parties are a great way for employers to show appreciation for their employees and boost morale. That said, employees must still behave appropriately; an employer should not tolerate behavior at a party that would not be allowed at work. Employers should ensure that employees understand the expectations for conduct at such events.
If alcohol will be served, there are potential risks an employer should consider. Allowing employees to drive after consuming alcohol might create liability exposure if an employer knew or should have known that an employee was unfit to drive and allowed them to do so anyway and an accident ensues, causing damage, injury or worse. For workers’ compensation purposes, consuming alcohol at a company function might be considered within the scope of employment if the activity is required or even endorsed by the employer, and any injuries or illnesses sustained might give rise to potential workers’ compensation claims. Company parties have also been the backdrop for sexual harassment and other complaints, particularly if employees become unruly and engage in improper behavior while intoxicated.
As alluded to above, an employer should emphasize its policies prohibiting alcohol abuse, harassment, fighting and other misconduct, all of which apply at a company social event. An employer can also consider refusing to serve alcohol to visibly intoxicated people, issuing a limited number of drink tickets, having nonalcoholic drink options and/or offering an alternative to driving (e.g., cabs, designated drivers, Uber services). Additionally, an employer should review its workers’ compensation and general liability insurance policies and contact the carriers for specific guidance on coverage and liability.
For additional information or to discuss this in further detail, please contact your Federated regional representative or EMA’s National Account Executive Jack West at 262.719.7750 for any additional information or risk management questions. Federated is a Partner in EMA’s Board of Directors Council.
At Federated Insurance, It’s Our Business to Protect Yours®
The Question of the Month is provided by Zywave®, a company wholly independent from Federated Insurance. Federated provides its clients access to this information through the Federated Employment Practices Network with the understanding that neither Federated nor its employees provide legal or employment advice. As such, Federated does not warrant the accuracy, adequacy, or completeness of the information herein. This information may be subject to restrictions and regulations in your state. Consult with your own qualified legal counsel regarding your specific facts and circumstances.
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