Diesel: Greener Than You Think

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Another thing that has changed since the '70s: The Environmental Protection Agency has tightened emissions standards. Advocates point out that when burning new, cleaner blends of fuel in advanced engines, a modern diesel built to meet U.S. standards "acts like an air filter, spitting out exhaust that has fewer particulates than the ambient air in many cities," says Timothy Johnson, director of emerging technologies and regulations at Corning, which makes filtration gear for auto-exhaust systems.

But "clean" is still a relative concept for diesel technology. Modern diesels still emit significantly more smog-forming compounds—especially nitrous oxide—than gasoline engines or hybrids. In the 2008 model year, EPA data predict a Mercedes E320 Bluetec with a 3-liter engine will dump 10.75 lbs of smog-forming pollutants into the air every year. That's about twice what a Toyota Camry 3.5-liter gas engine will emit and nearly four times what the 2.4-liter Camry Hybrid puts out. Although most of the new generation of diesels are legal in all 50 states now, diesel makers will have to further cut their nitrogen oxide, or NOX, emissions to continue selling in markets that follow California's emission rules, which will tighten in years to come.

Performance Edge

What automakers are really counting on selling, though, is the combination of power and mileage that comes from the technology's performance edge. One reason diesels go further on each gallon is because the fuel contains 11% more energy per gallon than gasoline. And when combusted in a piston, diesel burns more completely than gasoline, delivering more bang each time the fuel is detonated. This autumn, BMW will bring the 335d diesel sedan, not yet priced, to U.S. showrooms. Its 3-liter, six-cylinder engine will deliver 265 hp, and get 23 mpg in the city and 33 mpg at highway speeds—about 27% better than the gas-powered 335i. "Diesel is a good answer for us. The hybrids so far have for the most part tended to go to pure fuel-savings side, not high-performance vehicles," says Rich Brekus, general manager of Product Planning & Strategy for BMW North America. "Clean diesel can do both."

Japan's Honda is also turning to diesels to round out its green offerings. Although the Accord is one of the best-selling models of all time, the hybrid version was a flop. It carried a relatively high price and delivered minor mileage gains compared with a gas-powered Accord. Honda killed the hybrid model last year. Its replacement, due out in 2009, will be an advanced diesel adapted from its European market. At the Detroit Auto Show, Honda announced it will also introduce a 2.2-liter, four-cylinder diesel version of the Acura TSX this year. The following year, Honda is expected to launch a six-cylinder clean diesel in its Acura TL and MDX models.

Honda's move into diesels speaks volumes about just how clean the technology has become. Awarded the title of Greenest Car Maker by the Union of Concerned Scientists, a left-leaning think tank, Honda earned the mantle by relentlessly making incremental performance gains from existing technology. For example, to clear the latest, most stringent U.S. air quality standards, Honda created a groundbreaking design that cuts smog-forming NOX emissions by creating its own supply of ammonia on board. Ammonia neutralizes the NOX. Existing diesels from Mercedes and BMW crack this problem less elegantly, by adding a small, refillable tank of ammonia that is spritzed into the exhaust stream.

It's the kind of innovation that's likely to convince more drivers to add clean diesels to their shopping list of green cars.

Aston is Energy & Environment editor for BusinessWeek in New York .