Proposal:

Amend Contract with Southwest Research Institute to Cost Share Year 4 of the GasRail USA Program

Synopsis:

GasRail USA is a government-industry program at Southwest Research Institute to develop and demonstrate low-emitting, natural gas locomotives in the basin. Program funders include ARB, DOE, SoCal Gas, General Motors Electromotive Division, the Gas Research Institute, and the Southern California Regional Rail Authority (SCRRA). The Board previously authorized AQMD funding for Years 1 through 3 of the program. To date, AQMD and SCRRA have each contributed $1,250,000 out of the $4,700,000 total. The total cost of Year 4 is about $2.63 million, half of which is being provided through SCRRA. An AQMD cost share of $500,000 is proposed.

Committee:

Technology, January 17, 1997, Recommended for Approval

Recommended Action:

Authorize the Chairman to execute an amendment to the contract with Southwest Research Institute in an amount not to exceed $500,000 to cost share Year 4 of the GasRail USA program.

James M. Lents, Ph.D.
Executive Officer

Background

The AQMP identifies the need to achieve substantial emissions reductions from locomotives and railroad operations which emit approximately 32 tons of NO_x per day in the basin. In a 1992 study funded by ARB and AQMD, the use of liquefied natural gas (LNG) was identified as one of the most feasible technological approaches to reduce locomotive emissions. The need for clean-fueled locomotives is even greater today, with EPA proposing new ambient air quality standards for fine particulate matter, as well as tighter standards for ozone. Diesel fuel is a major contributor to both of these pollutants. Consequently, more pressure will be placed on railroads and other diesel-fuel users to find low-emission alternatives such as LNG.

In September 1992, the Board authorized AQMD to join with SCRRA and other entities in funding a unique cooperative research program at Southwest Research Institute (SwRI). Now known as GasRail USA, the primary objective of this four-year program is to develop advanced, low-emission engine technology using LNG fuel for application to passenger locomotives in SCRRA’s Metrolink fleet. A secondary objective is to demonstrate LNG technology for freight locomotives that will provide high power and good fuel economy -- essential to the freight railroads -- while still lowering emissions. To date, the Board has authorized AQMD cost sharing on a year-by-year basis for Years 1, 2 and 3 of the GasRail USA program.

At the beginning of Year 3 (calendar year 1996), SwRI selected and began optimizing the most promising LNG technology, known as Late Cycle High Injection Pressure (LaCHIP). Subsequently, while testing in a single-cylinder locomotive engine, SwRI engineers were able to achieve major breakthroughs and demonstrate that LaCHIP technology can provide diesel-equivalent performance while reducing NO_x emissions by approximately 75%. Additionally, work was initiated to optimize the LaCHIP technology for a full-sized locomotive engine and design the LNG storage and delivery systems for the Metrolink passenger locomotive.

Proposal

In Year 4 of this program, SwRI and its subcontractors will conduct all the necessary tasks to complete development of the LaCHIP combustion technology, install it into a Metrolink F59PH locomotive, and integrate the locomotive for safe on-board storage of cryogenic LNG fuel. Specifically, SwRI will finish optimizing the LaCHIP technology in its 16-cylinder locomotive test engine to simultaneously achieve low emissions, high thermal efficiency, and good power. In parallel, SwRI and its subcontractors will convert a new GM-Electromotive Division locomotive engine over to the LaCHIP system and install this engine into a Metrolink passenger locomotive. SwRI and its contractors will fabricate LNG fuel-storage and delivery systems and install them onto the locomotive. The proposed AQMD cost share for Year 4 will primarily go towards this integration of the LNG fuel system, including several major engineering tasks to procure the necessary space on the locomotive by relocating or eliminating "stock" components.

It is expected that conversion of the passenger locomotive to an optimized, low-emission LNG configuration will be completed by the end of 1997. SwRI and its subcontractors will then provide operational / safety training and maintenance instructions to SCRRA employees. Next, SCRRA will revenue test the locomotive on a basin Metrolink line. SwRI will provide in-field technical support while monitoring emissions and operations of the retrofitted locomotive.

Parallel work will be done by SwRI in Year 4 to prepare for deployment of LNG locomotives in freight applications. If successfully demonstrated in real-world tests, the low-emission LNG combustion system developed under GasRail USA could become the standard for locomotive operations throughout Southern California, and beyond.

Sole Source Justification

Section II, Step C(3) of the Consultant Selection Policy and Procedure identifies four provisions under which a sole-source bid may be justified: (1) cost to prepare documents exceeds cost for consultant, (2) delay would result in the endangerment of public health, (3) services are only available from sole-source, (4) other circumstances exist identifying sole-source as in the best interests of the AQMD. This request for sole-source bid is made under provision #3.

The GasRail USA program offers a unique technical and funding team in pursuit of low-emission LNG locomotive engines. SwRI is the only research center in the United States, and perhaps the world, that has the expertise and equipment to conduct an LNG locomotive engine development and testing program of GasRail's magnitude. Participation by the Gas Research Institute, Amoco Corporation, and SoCal Gas has helped to ensure that major research and fuel-supply arms of the natural gas industry are involved in the program. Involvement of a major locomotive builder (GM-EMD) and two key end users of locomotives in the basin (Union Pacific and SCRRA) will help facilitate commercialization of LNG locomotive technology. The federal government has made a firm commitment to the program, as evidenced by DOE's close involvement and strong financial backing. Finally, ARB’s involvement in the program will help facilitate technology transfer among those who will be crafting future regulatory approaches involving railroad operations in the Basin, and throughout California.

Resource Impacts

SwRI estimates that $2,626,000 is needed to conduct the proposed Year 4 of the GasRail USA program. An AQMD cost share of $500,000 (19% of the total cost for Year 4) is proposed. Table 1 below shows the funding that each cosponsor has provided to date for the program, as well as the proposed funding breakdown for Year 4.

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Table 1:
Funding to Date and Proposed Year 4 Funding for GasRail USA Program

Agency/Organization	Funding to Date	Proposed Year 4
SCRRA	$ 1,250,000	$ 1,326,0001
AQMD	$ 1,250,000	$ 500,000
GM-EMD	$ 750,000	$ 250,000
U.S. Department of Energy	$ 600,000	$ 200,000
SoCal Gas	$ 500,000	$ 02
Gas Research Institute	$ 250,000	$ 250,0002
ARB	$ 100,000	$ 100,000
Union Pacific Railroad	$ 03	03
TOTALS	$ 4,700,000	$ 2,626,000

¹Includes $500,000 from SCRRA, $350,000 from the Petroleum Violation Escrow Account, and an AB 2766 grant to SCRRA of $476,000.

²SoCal Gas has incurred budget cuts and will not fund Year 4. The Gas Research Institute is considering funding Year 4, but at this time is uncommitted.

³Union Pacific has invested millions of dollars in LNG locomotive technology independent of GasRail USA. UP's in-kind contribution to the program includes access to LNG locomotives for real-world field testing.

In sum, the GasRail USA program continues to offer excellent potential to significantly reduce locomotive emissions in the basin. Each dollar of AQMD’s Year 4 funding will be leveraged by four outside dollars. Sufficient funds are available in the FY 1996-1997 Budget to continue funding this development and demonstration program.