BOARD MEETING DATE: January 21, 2000
AGENDA NO. 11

PROPOSAL:

Issue RFP for Development of Very Low-NOx Heavy-Duty Natural Gas Engine and Accept Co-funding from California Energy Commission and U.S. Department of Energy

SYNOPSIS:

Natural Gas Heavy-Duty Engines are typically certified at ARB low-NOx emission standards of 2.5 g/bhp-hr NOx or less, significantly below the heavy-duty engine emission standard of 4.0 g/bhp-hr. ARB proposes that transit bus engines be certified to 0.5 g/bhp-hr NOx in 2004 and 0.2 in 2007. Staff proposes to co-fund development of natural gas engines to meet this standard in the near term. Total funding for this RFP will not exceed $2,500,000. The AQMD’s Clean Fuels Program will provide $1,000,000, with maximum co-funding of $500,000 from the CEC, and $1,000,000 from the DOE. It is expected that there will be multiple awards from this RFP.

COMMITTEE:

Technology, December 17, 1999, fewer than three members were present and therefore, pursuant to the Procedures for Standing Committees of the Governing Board, the Committee forwards this letter without recommendation.

RECOMMENDED ACTION:

1. Approve issuance of RFP #9900-11, in an amount not to exceed $2.5 million, to solicit proposals to develop a low-NOx, heavy-duty natural gas engine.
   
    
2. Execute a contract with the California Energy Commission to receive funding in an amount not to exceed $500,000, and recognize this funding in the Clean Fuels Program Fund.
   
    
3. Execute a contract with the U.S. Department of Energy to receive funding in an amount not to exceed $1,000,000, and recognize this funding in the Clean Fuels Program Fund.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The federal Clean Air Act Amendments of 1990 classified the South Coast Air Basin as "extreme" nonattainment for ozone, and "serious" nonattainment for fine particulate matter (PM₁₀) and carbon monoxide. In September 1998, the California Air Resources Board (ARB) approved its Scientific Review Panel's recommendation and listed diesel particulate as a toxic air contaminant based on its potential human cancer risk. With an increasing number of trucks and other heavy-duty vehicles and a multiplying of vehicle miles traveled (VMT), the need for reducing emissions from these sources is critically important to meet clean air goals.

The majority of heavy-duty vehicles in the Basin are powered by diesel engines, which contribute significantly to the Basin’s emissions of NOx and particulates. The AQMD has long recognized the adverse air quality and health impacts of diesel exhaust. The AQMD’s Environmental Justice Initiative No. 7 targets the reduction of diesel exhaust in the Basin. The Governing Board reaffirmed its position supporting the purchase and use of alternative fuel vehicles in transit and other fleets at its October 1998 meeting. At the January 1999 Board meeting, the Governing Board adopted a "Children’s Air Quality Agenda" to pursue additional measures to protect children from the disproportionate impacts of diesel exhaust.

ARB proposes to reduce emission standards for heavy-duty engines to 2.0 g/bhp-hr NOx in 2004. ARB further proposes that transit bus engines be certified to 0.5 g/bhp-hr NOx in 2004 and 0.2 in 2007.

Proposal

There could be an immense air quality benefit if engines with 0.5 g/bhp-hr or lower NOx engines were implemented beginning in 2001 or 2002. In conversations with engine manufacturers, staff has become aware that achieving a 0.5 gram natural gas engine in the near term is possible. In cooperation with the California Energy Commission (CEC) and the Department of Energy (DOE), staff proposes to release an RFP soliciting proposals for development of a natural gas engine, certified to 0.5 g/bhp-hr NOx or below. Staff recommends that the AQMD provide $1,000,000 in Clean Fuels Program funds to support this effort. This amount will be supplemented with a maximum of $1,000,000 from the DOE and $500,000 from the CEC. Proposers will be required to provide a minimum of 50 percent of the proposed project cost. AQMD will be the project manager for the RFP and subsequent contract awards. CEC and DOE will provide support by participating in the RFP selection committee and assisting with project monitoring.

Outreach

In accordance with the AQMD’s consulting and contracting policies, a public notice advertising the RFP and inviting bids will be placed in the following publications:

Additionally, potential bidders will be notified utilizing the Los Angeles County MTA and Cal Trans Directories of Certified Minority, Women, Disadvantaged and Disabled Veterans Business Enterprises; the Inland Area Opportunity Pages Ethnic/Women Business & Professional Directory; AQMD’s own electronic listing of certified minority vendors; and AQMD Purchasing’s mailing list. Notice of the RFP was mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations; and placed on the Internet at AQMD’s Web site [http://www.aqmd.gov, "Business and Job Opportunities" icon] and AQMD’s bidder’s 24-hour telephone message line (909) 396-2724.

Benefits to AQMD

AQMD’s Clean Fuels Program has supported the development and demonstration of low-emission, alternative fuel heavy-duty engines. This support has directly led to the low-emission certification of alternative fuel heavy-duty engines. Commercialization of a 0.5 g/bhp-hr NOx natural gas engine in advance of ARB rulemaking will enhance the AQMD’s efforts to reduce emissions from the heavy-duty vehicle sector.

Resource Impacts

This project will be included in the Technology Advancement Plan Update for 2000. Sufficient funds are available from the Clean Fuels Program Fund, established as a special revenue fund resulting from the state-mandated Clean Fuels Program. The Clean Fuels Program, under Health and Safety Code Sections 40448.5 and 40512 and Vehicle Code Section 9250.11, establishes mechanisms to collect revenues from mobile sources to support projects to increase the utilization of clean fuels, including the development of the necessary advanced enabling technologies. Funds collected from motor vehicles are restricted, by statute, to be used for projects and program activities related to mobile sources that support the objectives of the Clean Fuels Program.

Attachment

RFP #9900-11- Development of Low-NOx Heavy-Duty Natural Gas Engine and Accept Co-funding from the California Energy Commission and the U.S. Department of Energy

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