To address stakeholder requests, the California Air Resources Board (CARB) staff announced on Tuesday, August 3, 2010, that it is postponing consideration of regulatory amendments until November, 2010.  It also announced that itwill be scheduling additional workshops in August/September to discuss the emissions inventory and proposed amendments.

When CARB Staff held workshops in June and July regarding proposed amendments to the Truck and Bus, Off-Road, Tractor-Trailer GHG, and Drayage Truck regulations many stakeholders requested additional time to review and comment on the regulations, including the following:

  • Details of planned emissions inventory updates for trucks and off-road vehicles,
  • Specific draft regulatory language,
  • ARB’s revised report on fine particulate matter (PM2.5) mortality estimates, a draft of which will be released later this summer, and
  • Proposed changes to the Drayage Truck Regulation.

To address those requests, CARB decided to move the Board Hearing to consider the proposed amendments, currently slated for September 2010, to November.  In the interim, CARB staff will hold workshops in August and September to discuss the revised emission inventory and the proposed amendments.  CARB says it believe that this delay in the hearing date will provide sufficient time to hold the workshops and to make any necessary adjustments after the workshops.

Background on the Regulations to Be Considered

The Truck and Bus, Off-Road, and Drayage Truck Regulations are intended to reduce toxic and smog-forming emissions from trucks, buses, and off-road vehicles. Reducing such emissions is necessary to meet federally imposed clean air standards and to reduce the adverse health effects from air pollution throughout the state. The Tractor-Trailer GHG regulation is intended to reduce greenhouse gas emissions from tractor-trailers traveling California’s roadways.

While staff is proposing to amend several elements of the truck and bus and off-road regulations, many provisions are in effect and not being considered for amendment.  These include:

  • Off-road reporting and labeling requirements;
  • Off-road idling limits and sales disclosure requirements; and
  • Requirements to report vehicles utilizing the agricultural vehicle provisions and some two engine street sweepers under the truck and bus regulation.

However, due to the pending amendments to the truck and bus and off-road regulations, several requirements have been postponed:

  • On February 11, 2010, CARB issued a delay of the off-road regulation’s retrofit and turnover requirements pending further notice.
  • The truck and bus regulation reporting originally required by March 31, 2010, has been delayed until early 2011.
  • The truck and bus retrofit and turnover requirements (scheduled to begin January 1, 2011) will also be extended.

The California Air Resources Board (ARB) has extended the verification for the Proventia Group’s FTF and Bobtail FTF to cover model year (MY) 2003 transport refrigeration unit (TRU) engines.

This action was taken in anticipation of ARB’s planned amendment to the TRU Airborne Toxic Control Measure (ATCM), which will change the in-use performance standard for MY 2003 engines from the Ultra-Low Emission TRU in-use performance standard to the less stringent Low-Emission TRU (LETRU) in-use standard.  MY 2003 TRU engines are required to comply with this in-use standard by December 31, 2010.

The Proventia FTF and Bobtail FTF flow-through filters reduce diesel particulate matter emissions at least 50 percent, plus they comply with the 20 percent NO2 limit, qualifying it as a Level 2 Plus Verified Diesel Emissions Control Strategy (VDECS).

This verification allows the FTF and Bobtail FTF Level 2 VDECS to be used as a retrofit compliance option to meet the TRU ATCM’s LETRU in-use standard.  It can be used on Thermo King TRUs with MY 1987 through 2003 truck TRU engines and MY 1985 through 2003 trailer TRU engines, provided certain terms and conditions are met.  TRU owners should read about the specific terms and conditions for which the Proventia FTF and Bobtail FTF have been approved in Executive Order DE-08-001-04, which will be posted the week of July 19, 2010, on the ARB Verification Procedure – Level 2 website at http://www.arb.ca.gov/diesel/verdev/level2/level2.htm.  The list of engines that can be matched with this filter will also be posted there as an attachment.

Additional information is available at: http://www.proventiafilters.com/

In what is considered to be a blow to U.S. corn growers, the EPA today sent a letter to the Gen. Wesley Clark chaired trade association “Growth Energy” indicating that the EPA needed more time to complete tests on how an increase by 5% (from 10% ethanol to 15% ethanol) in ethanol content may damage engines and fuel lines.

The good news for Growth Energy, which formally petitioned for the increase, was that the EPA reported that two tests showed that engines in newer cars can handle the higher blend. “The announcement is a strong signal that we are preparing to move to E15,” Growth Energy said in a statement, asserting that the switch would mean 136,000 new jobs.

However, the Renewable Fuels Association saw it as a major blow to the growth of biofuels in the U.S. “The delay threatens to paralyze the continued evolution of America’s ethanol industry,” RFA president Bob Dinneen said. “Moreover, this delay will chill investment in advanced biofuel technologies at a critical time in their development and commercialization.”

As it stands, the U.S. ethanol industry benefits from a tax credit, a tariff on imported ethanol and from the nation’s Renewable Fuel Standard, which will require fuel distributors to blend 15 billion gallons of ethanol with gasoline in coming years. But the industry is fast reaching that point and will exceed 11 billion in 2009.

The E15 blend has been controversial in part because of the damage that ethanol, a corrosive, already has caused in fuel lines and other components of boat engines and some small motors.

The EPA is involved because of air pollution implications and was required under the Clean Air Act to act by today on Growth Energy’s waiver request. The federal agency said that is has been working with the Energy Department to conduct tests “as quickly as possible given the available testing facilities.”

The Environmental Working Group, a Washington-based advocacy organization, praised the EPA’s deliberate process. The group’s Craig Cox said that sound science had trumped “efforts by well-funded and politically well-connected ethanol lobby to short circuit” the testing process.

The California Air Resources Board (CARB) has released the Preliminary Draft Cap-And-Trade Regulation and announced a December 14, 2009 Public meeting to discuss the Preliminary Draft Regulation.

In December 2008, CARB adopted the AB 32 Scoping Plan. The Plan incorporates a range of measures to reduce greenhouse gas (GHG) emissions in California, including the creation of a cap-and-trade program. As proposed, the California cap-and-trade program would include a stringent declining emissions cap. Emissions trading and the limited use of offsets would provide flexibility for covered entities to comply. If adopted, the cap-and-trade program would allow trading to ensure cost-effective emissions reductions and cover 85 percent of California’s GHG emissions.

CARB has issued the PDR in the hope to garner public comment and support.  To further its effort, CARB has scheduled a public meeting on Monday, December 14, 2009, from 1:00 pm to 5:00 pm at the Byron Sher Auditorium, 2nd Floor, at Cal/EPA Headquarters Building, 1001 I Street, Sacramento, California 95814.  In addition, CARB has inserted narrative into the PDR to highlight certain issues on which it is  specifically seeking comment.  For example, Section 95820 discusses “Covered Entities” the PDR “provides background on why the proposed covered entities were selected.” Along with the PDR, CARB issued an Excel spreadsheet entitled “Example Base Allowance Budgets for the California Cap-and-Trade Program” to provide example cap numbers.

There are five fundamental parts to the PDR:

  1. The Cap. The cap on emissions is set for each compliance period, first of which will begin January 1, 2012.  CARB is proposing to have three year compliance periods, with the possibility of staggering the phase-in of the program.
  2. Allowances.  Permits to emit GHG are “allowances.”  Every year the cap would decline and thus, the number od allwances issued would decline. At the end of a compliance period each covered entity would surrender allowances and any needed offsets that would equal its total GHG emissions during the compliance period.  Entities may do the following with their allowances: (1) surrender to to comply; (2) bank them for for future use; (3) trade them; (4) ask CARB to retire them.
  3. Banking. Refers to the ability to carry-over unused allowances or offsets from one compliance period to another.  Provides incentive for covered entities to make early reductions.
  4. Offsets.  Covered entities could buy offset credits in lieu of buying allowances or reducing their emissions on-site.  Offsets are tradeable credits that represent GHG emissions reductions that are made in areas or sectors not covered by the cap-and-trade program.
  5. Linkage to Other Greenhouse Gas Emissions Trading and Offset Crediting Systems.  The PDR proposes to link its cap-and-trade program to other trading systems.

At least initially, the program will be limited to large sources that emit 25,00 metric tons or more of GHG a year.  The list of covered entities proposed by CARB contains the usual suspects:  Electricity deliverers, transportation fuel deliverers, and facilities with the following operations or processes.

  • Stationary combustion;
  • Cement manufacturing;
  • Cogeneration;
  • Petroleum refining;
  • Hydrogen production;
  • Aluminum production;
  • Facility operators calcining carbonates;
  • CO2 supplier or transfer recipient;
  • Electricity generation;
  • Glass production;
  • Iron and steel production;
  • Lime production;
  • Natural gas transmission and distribution;
  • Nitric acid production;
  • Oil extraction field operation;
  • Gas extraction field operation;
  • Production of industrial gases;
  • Pulp and paper production; and
  • Soda ash production.

CARB states in its Notice that “while staff has specifically highlighted a number of areas for public comment, we welcome and will consider comments on all portions of the draft for the Spring 2010
proposed draft regulation.”  Comments are due no later than January 11, 2010 and can be submitted at: http://www.arb.ca.gov/lispub/comm2/bcsubform.php?listname=dec-14-pdrws&comm_period=1.

The Incentive Programs Advisory Group Meeting, scheduled for December 3, 2009, is being postponed until early 2010.  We will send out a meeting notice once we select a revised meeting date. The meeting is being rescheduled to better align with upcoming revisions to both the Carl Moyer Program Guidelines and the Goods Movement Emission Reduction Program Guidelines.

These proposed guideline updates will be considered by CARB in March 2010. CARB believes the next Advisory Group meeting will be most productive if it is held after CARB staff has held workshops on its proposals but before Board consideration.

The Incentive Programs Advisory Group, led by ARB Board Member Sandra Berg, provides a forum for discussing policy level issues relating to the development and ongoing implementation of California’s air quality incentive programs. These include the Carl Moyer Program, the Lower-Emission School Bus Program, the Goods Movement Emission Reduction Program, the AB 118 programs, and other locally run air district programs, among others.  The group meets twice a year to provide a venue for policy level coordination among agencies and programs.

For more information about the Advisory Group, please visit ARB’s web site at http://www.arb.ca.gov/msprog/moyer/advisory_group.htm .

On Tuesday, November 10th, the second meeting of the California Air Resources Board’s Truck Regulations Advisory Committee (TRAC) and its designated subcommittees will be held. The main TRAC meeting will be held from 3-5 PM PST in the Sierra Hearing Room at the CALEPA Building in Sacramento, CA and webcast.

For webcast information, please visit http://www.calepa.ca.gov/broadcast/?BDO=1.

The agendas of the day’s event can be found by clicking here or by visiting the TRAC website.

Background on the TRAC:

The California Air Resources Board (CARB) created the Truck Regulations Advisory Committee (TRAC) as part of its implementation of the Truck and Bus regulation and the Heavy-Duty Diesel Greenhouse Gas Emission Reduction regulation.  TRAC was formed to assist CARD in facilitating communication with stakeholders and to obtain stakeholder feedback on the implementation tools used for these regulations. According to CARB, The goals of TRAC is to help CARB staff fine tune its outreach, training, and implementation materials and provide a mechanism for stakeholders to discuss other implementation issues.

This post was authored by Rajiv Tata, who currently serves as General Counsel for Utility Trailer Manufacturing Company:

California’s Heavy-Duty Greenhouse Gas Reduction Measure (GHG Measure) will affect the transportation of goods between California and other states, and will therefore impact interstate commerce. Although the federal government seems as though it will eventually regulate greenhouse gases, thereby possibly preempting state regulations like the GHG Measure, for now, the constitutionality of the GHG Measure will likely depend upon a dormant commerce clause analysis.

There is ample precedent under U.S. Supreme Court jurisprudence establishing that absent discrimination a state regulation affecting interstate commerce will be upheld unless the burden imposed on interstate commerce is clearly excessive in relation to the regulation’s putative local benefits. It is also well established that the power of the state to regulate the use of its highways is broad and pervasive. It is not surprising then that the Court’s recognition of the peculiarly local nature of safety issues, both in the context of highways and human health, resulted in such regulations being upheld despite their impact on interstate commerce.

Under dormant commerce clause analysis, the threshold inquiry is to determine whether a challenged law discriminates against interstate commerce. Here, the GHG Measure is not likely to be considered discriminatory against out of state transportation companies since the requirements actually increase the operating costs of companies domiciled within California.

Typically, if the challenged regulation is not discriminatory, it will be upheld unless there is an excessive burden on interstate commerce in relation to its “putative local benefits.” Therefore, any analysis involving the constitutionality of the TRU ATCM and GHG Measure will have to weigh their respective burdens and benefits. The Supreme Court applied a dormant commerce clause analysis to a state regulation in a factual context similar to that presented by California’s GHG Measure. In Bibb v. Navojo Freight Lines, Inc., the Court determined the constitutionality of an Illinois statute requiring the use of a specific rear fender mudguard on trucks and trailers operating on that state’s highways.

The Court’s analysis balanced the statute’s safety benefits against the burdens it imposed on interstate commerce. Initially, the Court noted that statutes pertaining to safety are afforded a strong presumption of validity because they often involve policy decisions that are best left to the discretion of state legislatures. In the Bibb case however, the Court found that the statute placed burdens on interstate commerce that were outweighed by its benefits. Specifically, the facts the Court found to be outcome determinative included the costs associated with the installation, maintenance, and replacement of mudguards, safety issues relating to decreasing the effectiveness of truck and trailer brakes, and mudguards’ susceptibility to fall off during use. In addition, the Court found that Illinois’ regulation conflicted with that of another state, thereby requiring interstate carriers to shift loads to differently designed vehicles when traveling between the states. Combined, the heavy burden on the interstate movement of trucks and trailers led the Court to strike down the regulation because it surpassed the permissible limits for safety regulations.

The GHG Measure imposes burdens on the movement of trucks and trailers in interstate commerce similar to those relied upon by the Court to strike down the Illinois statute in Bibb. Under the GHG Measure carriers will need to purchase side skirts, front and rear trailer fairings, low-rolling resistance tires, and incur the cost of installing, maintaining, and repairing these items on their fleets.
Similar to the statute in Bibb, the GHG Measure also presents a safety issue. Trailer side skirts can be easily damaged while crossing railroad tracks and driveways, and while loading and unloading at docks with tapered ramps. Truck drivers will need to remove the devices if damaged under such circumstances, resulting in down time, or bear the liability risk of the devices detaching from the trailer while driving. Moreover, the aerodynamic side skirts will likely operate in treacherous weather conditions, often bearing the additional weight of snow or ice that could compromise the devices’ safety and result in failure at high speeds.

The California regulations present a third burden identified in Bibb, requiring interstate carriers to shift loads to differently designed vehicles when traveling between the states. Entire out of state fleets will incur the costs of compliance with the California regulations because it is often not possible for carriers to know in advance which equipment will be used in a particular region on a particular day. Moreover, those carriers not wanting to incur these operating costs would need to expend time and resources in ensuring that cargo was transferred to designated trailers equipped to legally operate in California.

Based on the Bibb factors, a court analyzing the costs associated with complying with the California regulations might conclude that they impose too great a burden on interstate commerce to be upheld.

Notwithstanding the numerous burdens placed on interstate commerce by the California regulations, a thorough dormant commerce clause analysis will need to consider their respective benefits. California’s stated purpose in enacting the GHG Measure is to control major sources of GHG emissions to alleviate a serious threat to California’s public health, natural resources and environment. To accomplish its goal, ARB grouped sources of those emissions into various sectors. Not surprisingly, the GHG Measure is grouped under the transportation sector.

The GHG Measure seeks to alleviate the harm GHGs pose to public health by improving the fuel efficiency of heavy duty trucks and trailers. The GHG Measure’s perceived benefits are illusory in several ways however. Test data used to justify the adoption of the GHG Measure demonstrates that desired fuel efficiencies materialize at sixty five miles per hour or more. Such speeds are unattainable both legally and practically. First, the California Motor Vehicle Code prohibits a truck from exceeding fifty-five miles per hour on a highway. In addition, CalTrans data demonstrates that the average truck speed on California’s main commercial corridor is less than sixty five miles per hour. At these speeds the fuel savings used to justify the regulation’s adoption cannot be attained. If the fuel savings cannot be attained, the corresponding health benefits from reduced GHG emissions cannot be realized. Under such a scenario, the burdens imposed by the GHG Measure will significantly outweigh the regulation’s unobtainable benefits, thereby reducing the likelihood that it will survive legal challenge.

Even if the GHG Measure’s intended benefits are realized, the problem California might encounter in sustaining the validity of its regulations under a dormant commerce clause challenge is that air contaminants contributing to public health concerns are inherently fluid, and therefore global in nature. Indeed, the heads of the U.S. Departments of Agriculture, Commerce, Transportation, and Energy, in response to the U.S. Supreme Court’s decision in Massachusetts v. Environmental Protection Agency, agreed that the regulation of GHGs must take a different approach than that used to historically regulate air pollution:

the Clean Air Act is premised on the idea that controlling
emissions in the United States will improve air quality in the
United States, and that a state or region can improve its air
quality by controlling emissions in that area. This is not true
in the case of greenhouse gases. Controlling greenhouse gas
emissions in the United States will reduce atmospheric
concentrations of those gases only if our emission reductions are
not simply replaced with emissions increases elsewhere in the
world.

In adopting the GHG Measure, California is clearly attempting to address a global issue, which as discussed above, will have a significant impact on interstate commerce. Under such a factual scenario, courts may need to develop a new standard for analyzing the validity of state GHG regulation. Such analyses will need to not only evaluate the burdens and benefits of such regulation on interstate commerce, but whether those benefits are realized at a local, state, national, or even international level. The result of such an analysis will hopefully determine how to equitably apportion the burden associated with such benefits.

For more information, please visit http://climatechangelegal.blogspot.com/ or
http://rajivtata.com

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