Who Stands to Profit From California's New Diesel Regulations?

Consuming diesel in California is going to start to get tricky.

The California Air Resources Board passed regulations last week that will require big rig truckers to add filters to their existing fleets of vehicles between 2011 and 2014. Approximately 1 million big rigs ply the state.

"Heavy-duty big rigs are the largest remaining source of unregulated diesel emissions, responsible for 32 percent of the smog-forming emissions and nearly 40 percent of the cancer-causing emissions from diesel mobile sources," the agency said.

It is likely that the state, which already has regulations in place, will also likely regulate other types of diesel engines. And it's a good bet that other states or even the Federal government will follow suit. Several of President Elect Barack Obama's cabinet members and advisors – such as future Energy Secretary and current director of Lawrence Berkeley National Lab Steve Chu – hail from the Golden State (see Steve Chu to Be Named Energy Secretary and Obama Creates an Energy Policy Troika).

The trucking regulations might cost $5 billion to comply with, the agency estimated. (It will provide some funding). Still, it's a big number.

So who might profit – beside those that retrofit the engines – in cleaning up diesel over the next few years?

1. Nanostellar: The company, founded by former Stanford Provost and start-up entrepreneur William Miller, produces catalysts that can reduce diesel emissions by up 20 percent to 40 percent. Metals inside catalytic converters exist to break down things like carbon monoxide. Gases from the combustion process enter the converter and, when they come into contact with the metals, recombine with other gases to make less harmful gases and byproducts.

Platinum, the traditional metal inside converters, is costly, running about $820 an ounce, which is prompting thieves to try and steal them. Platinum particles also clump together over time and lose their effectiveness. Some of Nanostellar's catalysts use gold particles, but less than the amount of platinum that's usually inserted.

2. Firefly Energy: Right now, truckers run their engines all night so that they can have heat, air conditioning and TV in their sleeping quarters. That becomes illegal under the new regulations. Firefly, a spin-out of Caterpillar, has a deep-discharge lead-acid battery that can provide power to a sleeping cabinet all night. The key to the system is a graphite-coated membrane (see Firefly to Charge Up Long-Haul Trucking).

3. Achates Power, EcoMotors and Transonic Combustion: All three companies are in prototype mode and all are mostly aiming their technology at cars, but there is potential for getting into the truck market. The three companies make components that help boost mileage in diesel engines. Transonic's parts also work in gas burning cars.

4. Stirling Denmark: This is for the stationary diesel market. Stirling makes a Stirling Engine that gets its power from biomass. Right now, a lot of rural, isolated communities rely on diesel generators.

5. Solazyme and Other Algae Biodiesel Companies: This one's self-explanatory.

6. AFV Solutions: The company makes comparatively inexpensive diesel hybrid buses with a Chinese partner. Some are already on the Streets of San Francisco.

7. Plug Power and Oorja Protonics: The two companies made industrial-scale fuel cells that can replace diesel generators.