AQ Programs

​The Oregon Department of Environmental Quality is providing $8 million in grant funding to reduce diesel emissions in Oregon in 2021. Revenue for this program is provided by the Environmental Mitigation Trust Fund, subject to the settlement agreement between the United States and Volkswagen Group of America, Inc. In 2019, the Oregon Legislature authorized the creation of a grant program supporting businesses, governments and equipment owners in replacing older and more polluting diesel engines with new, cleaner technologies and exhaust control retrofits.​ 

Key Dates for 2021

Estimated dates of grant application and deadlines are below. These are subject to change based on the timing and availability of funds and the schedule of implementation tasks.

Grant Program Opens for Applications
Grant Program Closes for Applications8/31/2021
Grant Awards Announced10/31/2021
Funding for Projects Becomes Available12/31/2021

​Key Information About the Program

DEQ will provide a user guide with detailed information for grant applicants to determine which types of diesel equipment are eligible for funding to reduce emissions. It will include timelines, application processes and reporting requirements for program participants.

Limited technical assistance is also available from DEQ staff at


Since 2009, the Volkswagen Group of America, Inc. — under the Volkswagen, Audi and Porsche nameplates — sold diesel passenger cars in the United States with emission control defeat devices that violated federal motor vehicle emission standards. A settlement resulted in the creation of the Environmental Mitigation Trust Agreement that requires Volkswagen Group of America, Inc. to provide more than $2.9 billion nationwide to mitigate previous and current excess emissions of nitrogen oxides by these noncompliant vehicles.

The initial allocation to the state of Oregon (based on registration share of VW diesel vehicles by state) was determined in 2017 and is approximately $73 million. The award must be spent by Oct. 2, 2027 and the funds must be used to upgrade diesel equipment from older and more polluting engines to newer, cleaner technology. The court settlement establishes the types of projects that can be funded and the amount of support available for different projects by equipment model year, type, and owner.

Program Overview

The Oregon DEQ Diesel Emissions Reduction Grant Program allows a broad range of diesel equipment owners, including public, private and tribal entities across the state, to apply for funding for emission reduction projects. Proposals for retrofitting, repowering or replacing older, more polluting diesel equipment in favor of newer, cleaner alternative technologies must measurably decrease diesel emissions in Oregon. Each complete and timely application is evaluated based on criteria included in Section 5.4 of the user guide. 

Each project must address diesel emissions from equipment that is currently operating in Oregon. DEQ plans to award approximately one-fifth of available funding (~$8M per year) during each of five consecutive calendar years, beginning in 2021 and ending in 2025. The schedule allows for certainty among diesel equipment owners regarding funding availability and will ease implementation, allowing for the continuous processing of grant projects.


Contact with any questions about this program.

Gerik Kransky, Air Quality Planner

​Lynda Viray, VW Mitigation Specialist

Angela Parker, Operations and Policy Analyst