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Tennessee and the Volkswagen Diesel Settlement

VW Settlement Breakdown2

In 2015, Volkswagen (VW) publicly admitted that it had secretly and deliberately installed a defeat device—software designed to cheat emissions tests and deceive federal and state regulators—in approximately 590,000 model year 2009 to 2016 motor vehicles containing 2.0 and 3.0 liter diesel engines. The United States Department of Justice (DOJ) filed a complaint against VW, alleging that the company had violated the Clean Air Act. In October 2016 and May 2017, the U.S. District Court, Northern District of California (“Court”), approved two partial settlements related to the affected 2.0 and 3.0 liter vehicles, respectively, totaling $14.9 Billion (“the VW Settlement”).

In April 2017, a third partial settlement, addressing civil penalties and injunctive relief, was approved by the Court. Under the third partial settlement, VW has paid a $1.45 Billion civil penalty for the alleged civil violations of the Clean Air Act. The money was collected via the Department of Justice and was deposited to the U.S. Treasury.

 The VW Settlement will be implemented through the First Partial Consent Decree and Second Partial Consent Decree. Under these consent decrees, VW has agreed to:

  1. Dedicate $10 Billion to the recall of at least 85% of the affected 2.0 and 3.0 liter vehicles;
  2. Invest $2 Billion in zero-emission vehicle infrastructure and promotion (“Zero Emission Vehicle Investment Plan”); and
  3. Establish a $2.9 Billion Environmental Mitigation Trust to mitigate the environmental effects of the excess nitrogen oxide (NOX) emissions from the affected vehicles.

Information on these three components of the VW Settlement is available below.

Click here to sign up for the TDEC VW Settlement email list.

How are we doing? Please provide any feedback related to TDEC's VW Settlement webpage to OEP Senior Program Manager Alexa Voytek at Alexa.Voytek@tn.gov or 615-532-0238.

If it is hard for you to read, speak, or understand English, please see our Language Assistance webpage for more information about our free language assistance services.

For more information on the State of Tennessee and the VW Settlement EMT, click here. For more information on the State’s BMP, click here.

Under Appendix C to the Volkswagen Diesel Settlement’s First Partial Consent Decree, VW must invest $2 Billion over 10 years in projects that support the increased use of ZEVs, which are defined as battery electric vehicles (BEVs), plug-in hybrid vehicles (PHEVs), and fuel cell electric vehicles (FCEVs). This will be a VW-administered program. VW has created a separate entity within VW Group of America, known as Electrify America, LLC, to oversee the ZEV investment. The funding will be distributed over four, 30 month cycles:  $300 Million per cycle in the National ZEV Investment Plan with EPA oversight (totaling $1.2 Billion) and $200 Million per cycle in the California ZEV Investment Plan with California Air Resources Board (CARB) oversight (totaling $800 Million).

On December 9, 2016, VW launched www.electrifyamerica.com, which provides information on VW's Zero Emission Vehicle infrastructure and awareness campaign, as well as details on how states, municipalities, and others can submit proposals to help inform VW's ZEV Investment Plans over the next 10 years. 

Eligible National ZEV Investment expenses include:

  • Design/planning, construction/installation, and operation and maintenance of ZEV infrastructure;
  • Brand-neutral education or public outreach that builds or increases awareness; 
  • Programs or actions to increase public exposure or access to ZEVs without requiring the consumer to purchase or lease a ZEV at full market value, such as car sharing services or ride hailing services.

On April 9, 2017, Electrify America published the National ZEV Investment Plan: Cycle 1. The Cycle 1 plan, which was approved by the U.S. EPA in early April, runs through June 2019. TDEC has submitted feedback to Electrify America for both the Cycle 1 and Cycle 2 solicitations for public comment, proposals, and recommendations. The State will continue to coordinate and engage with Electrify America in an effort to spur investment by Electrify America in Tennessee.

Stay up-to-date on Electrify America’s activities by visiting www.electrifyamerica.com/news to read all relevant press releases. To view an up-to-date map of all current and planned Electrify America charging stations, visit www.electrifyamerica.com/locations.

More information regarding the VW Settlement ZEV Investment can be found in Appendix C to the First Partial Consent Decree.

The First and Second Partial Consent Decrees require VW to dedicate $10 Billion to the removal or modification of at least 85% of the subject 2.0 liter vehicles by June 30, 2019, the subject 3.0 liter generation 1 vehicles (MY 2009-2012) by November 30, 2019, and the subject 3.0 liter generation 2 vehicles (MY 2013-2016) by May 31, 2020. These vehicles can be removed or modified through:

  • Vehicle buyback,
  • Lease termination, or
  • An EPA-approved emissions modification.

According to a quarterly compliance report released November 26, 2018, approximately 90% of the subject 2.0 liter vehicles have been removed from commerce or modified as required by the settlement. Visit www.VWCourtSettlement.com for more information on approved emissions modifications for 2.0 and 3.0 liter subject vehicles as well as consumer options related to subject vehicle buyback and lease termination.

More information regarding the VW Settlement Vehicle Buyback and Emissions Modification Program can be found in Appendices A and B to the First and Second Partial Consent Decrees