I just bought a 1985 240, and the inside/out look real nice and it runs smoothly. However, I brought it in to get an emissions test for my state, and it won't pass. Both the CO and the HC levels are extremely high, like 11.97% CO and 518 HC ppm at idle. It gets a little closer to passing at higher RPMs, but still misses the mark.
I have replaced the spark plugs and wires, as well as the O2 sensor since I've bought this car, but the emissions still show that this car is running super rich. Does anyone know what might be causing this? If I spend enough money trying to fix this and it still won't pass, I can get a waiver for it but I'd really much rather have the car in better working condition if I can.

 

I'm assuming its idling at the right RPM, nominally 700-750 RPM when warmed up?

various things can make an engine run too rich, including in no particular order..

• intake air leaks after the MAF but before the throttle body
• exhaust leaks before the OX sensor
• coolant temp sensor readings telling the ECU/ICU the engine is cold when its actually warm
• worn out catalytic converter
• etc

one simple test to see if the 'lambda cycle' is working... find the oxygen sensor connectors on the firewall near the wiper motor, there's a 1 pin and a 2 pin connector... open the 1 pin connector, wrap a thin strand of copper wire around the pin and plug the connector back in with this wire hanging outside the connector, and hook a volt meter set for low range DC Volts between that copper wire and a decent nearby ground... start the engine, let it warm up so the idle is normal, and the voltage *should* be swinging between a lower value around 0.1-0.3 volts, and a higher value between 0.6 and 0.9 volts every few seconds, and ideally its spending as much time 'low' as 'high', if so the engine thinks it is running in good lambda balance, so the issue is more likely the catalytic converter or an exhaust leak before the oxygen sensor.

btw, in many smog-testing states, like California, its the SELLERS responsibility to provide you with a passing smog test. Failure to do so is illegal, and selling a vehicle without disclosing known defects is also illegal.

also, 1985 is in the midst of the 'ecojunk' aka 'biodegradable' wiring era for Volvo (from about 1982 to mid year 1987, some folks say as early as 1980). The engine harnesses on those years is very prone to crumbling and failing insulation, this is often NOT evident as it happens inside the outer black sheaths where it can't be seen.

 

The engine does idle right at 750 RPM with no problems. For the O2 sensor, I did replace it, because that single wire would stay at 0.85 volts and just sit there.
As for emissions, I live in Utah and bought the car off of someone in Idaho, where they didn't need an emissions test for their car. I was hoping it would pass emissions without problems since it ran so smooth and I didn't see any smoke at all coming out the tailpipe but it doesn't seem to be going that way.
I did also hear about the "biodegradable" wiring harness, but the insulation was very good when I looked at it. No (visible) cracks, and the wires aren't stiff or hard to move, they feel fine to me, and with the general condition of the car I'm thinking someone might have replaced them in the past or just got lucky and they didn't degrade as fast.
I haven't been able to find any vacuum or intake leaks, and the only exhaust leaks are a couple holes in the exhaust pipe after the muffler way in the back.
I am worried about the temperature sensor, since the dashboard shows a very low temperature most of the time. Every now and then the gauge will go up to a little below halfway point, but it usually sits just barely above the bottom line, even after hours of highway driving.
Thanks for the help! I'll start looking into how to test the temp sensor

 

note the dashboard gauge is connected to a different temp sensor than the dual one that feeds the ICU (ignition) and ECU (injection).


I wonder if this engine is actually running cold, maybe there's no thermostat, or the thermostat is stuck open, then it would never heat up, and if it never heats up, it would run rich. We can add that to 'etc'