South Coast Air Quality Management District

Status Report on Implementation of Rule 1193 – Clean On-Road Residential and Commercial Waste Collection Vehicles

SYNOPSIS: 

At the July 20, 2001 Board Meeting, the Board directed staff to provide a status report on the implementation of Rule 1193 at the August Board meeting. Staff will provide a report on the status of alternative fuel usage in the waste hauling industry, state of technology relative to dual-fuel technologies, alternative fuel infrastructure development and potential implementation issues.

COMMITTEE: 

Not applicable.

RECOMMENDED ACTION:

Receive and file report.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

Rule 1193 – Clean On-Road Residential and Commercial Waste Collection Vehicles was adopted on June 16, 2000 and is one of seven clean fleet vehicle rules adopted to-date. Unlike the other clean fleet vehicle rules that affect primarily public fleets, Rule 1193 applies to both public and private fleets of waste hauling vehicles.

Rule 1193 requires operators of waste collection vehicles to purchase alternative-fueled or, for a limited time, dual-fueled vehicles. There are about 6,000 waste collection vehicles operating in the South Coast Air Basin. It is generally believed that there are about 2,000 curbside collection vehicles and about 4,000 transfer and rolloff vehicles. Curbside collection vehicles are those vehicles that pickup solid waste in residential areas or commercial establishments. The solid waste is generally taken to a landfill or to a transfer station. Waste collected at a transfer station is transported to a landfill by transfer vehicles (generally considered a Class 7 or 8 long-haul heavy-duty vehicle). Recyclable materials from a transfer station may be taken by transfer vehicles to other locations for processing. Rolloff vehicles are similar to transfer vehicles but have the ability to load and unload a waste container.

Rule 1193 requires those fleet operators with 50 or more curbside collection vehicles to purchase alternative-fueled vehicles beginning July 1, 2001. Those fleets with more than 15 but less than 50 curbside collection vehicles would begin rule implementation July 1, 2003. In addition, prior to July 1, 2002, fleet operators may purchase dual-fueled vehicles (i.e., vehicles that operate primarily on alternative fuels but use diesel fuel to ignite the alternative fuel). A sunset date was placed on dual-fuel vehicle purchases because of the fact that, at the time of rule adoption, dual-fueled curbside collection vehicles did not operate primarily on the alternative fuel in a typical curbside collection duty cycle. The manufacturers of dual-fuel engines are refining the technology such that the vehicles do operate primarily on the alternative fuel. As such, if new model year dual-fueled engines were certified to operate primarily on the alternative fuel during a curbside collection duty cycle, Rule 1193 could be amended to allow for purchases of dual-fueled vehicles after July 1, 2002. Regardless, Rule 1193 does allow for the purchase of dual-fueled vehicles until July 1, 2003 if the existing fleet of post-1995 vehicles were to be equipped with CARB approved particulate traps.

Relative to transfer and rolloff vehicles, those fleets with 15 or more transfer or rolloff vehicles, or any combination of 15 or more transfer, rolloff, or curbside collection vehicles, are required to purchase alternative-fueled or dual-fueled vehicles beginning July 1, 2001. There is no sunset date relative to purchases of dual-fueled transfer or rolloff vehicles since these vehicles do not operate in a stop-and-go duty cycle.

Rule 1193 provides several exemptions that would allow for the purchase of a conventional diesel-powered vehicle. These exemptions include commercially unavailable alternative fuel engine/chassis configurations, alternative fuel engine/chassis configuration that could not be used for a specific route, and the recognition that a variance process is available should operators find that the purchase of alternative-fueled vehicles is not feasible for their specific operations.

In addition, the Board established a technical advisory implementation working group comprising of public and private waste collection operators, fuel providers, CARB, and other stakeholders to address implementation issues. The Rule 1193 Technical Advisory Implementation Working Group have met to discuss implementation issues related to refueling infrastructure development, dual-fuel technology development, funding for alternative fuel vehicles and infrastructure, and training needs. Staff developed a Rule 1193 Implementation Guidance Document, answered questions regarding specific purchase situations, and provided information to individual fleet operators. In addition, to allow for operators to gain familiarity with alternative-fueled vehicles, the Board approved a vehicle loan program for waste collection operators to participate in. Several waste collection operators have participated in the program and found that the alternative-fueled vehicles performed well compared to their diesel counterparts.

Several operators have begun purchasing alternative-fueled vehicles and developing the refueling infrastructure. Many operators simply have taken a "wait-and-see" attitude, with most continuing to purchase conventional diesel-powered collection vehicles prior to July 1, 2001. In addition, several municipalities required the use of alternative-fueled collection vehicles as part of the conditions in refranchising waste collection services.

Prior to July 1, 2001, staff received comments from the California Refuse and Removal Council - Southern District and several individual operators expressing concerns on the refueling infrastructure, the availability and price of compressed and liquefied natural gas, the limited availability and added expenses of alternative-fueled engine/chassis configurations, training needs, and the uncertainty of the variance process.

Many of the issues raised were previously addressed during rulemaking. Since rule implementation began on July 1, 2001, staff has met with two operators individually on compliance with the rule requirements. In addition, a third operator indicated that while the rule does not affect his operations until July 1, 2003, he has placed a request to purchase dual-fueled vehicles and is exploring the use of biodiesel in the existing fleet. The following sections discuss the above issues further.

Alternative Fuel Refueling Infrastructure Development

Since the adoption of Rule 1193, several fleet operators, landfill operators, and fuel providers have taken steps to develop the refueling infrastructure. However, this process has been lengthy, in part, because of the need to identify partnerships and financial resources.

Recently, the Board approved the award of $4.6M toward the expansion of the natural gas refueling infrastructure. In addition, the Board directed $6M from the Los Angeles Department of Water and Power settlement funds back to the City of Los Angeles to develop public access refueling infrastructure. Several solid waste collection operators and landfill operators were awarded funding assistance to develop either compressed natural gas or liquefied natural gas refueling infrastructure. These refueling stations will come on line later this year or early 2002.

Some operators have expressed concerns that infrastructure development has not occurred as rapidly as anticipated and that while fleet operators must purchase alternative-fueled vehicles at this time, they will not have adequate fueling facilities by the time the alternative fuel vehicles begin arriving. As noted above, a number of new fueling stations are expected to be online over the next few months. In addition, staff believes that operators do have a choice of going with mobile fuel suppliers in the interim while further infrastructure is being developed. However, several operators who have investigated the cost of mobile fuel delivery believe that the fuel costs may be overly expensive. In addition, these operators expressed concerns that there is essentially only one major mobile fuel supplier to California at this time.

Therefore, some operators are requesting that an exemption similar to that provided in Rules 1195, 1196, and 1186.1 relative to access to refueling stations within five miles of the location where the fleet is garaged should be provided in Rule 1193. Staff believes that an alternative fuel refueling infrastructure exemption is not necessary at this time given that operators could apply for a variance or work with the staff and the Chief Prosecutors Office for relief from the rule. A discussion is provided later in this report relative to the variance process.

Natural Gas Availability and Price

During the period after rule adoption and prior to rule implementation, natural gas prices fluctuated with natural gas prices spiking. Comments were made to staff that such price increases will lead to additional operational costs that was not foreseen when the rule was adopted. However, in the recent months, natural gas prices have decreased and appear to be stabilized at this time.

Relative to fuel availability, some operators have indicated a preference for liquefied natural gas (LNG) technology. The use of LNG in a dual-fuel engine application appeared to be the most feasible economically. The LNG dual-fuel engine would have the same torque as its diesel engine counterpart and the same number of fuel tanks for storage of LNG would be the same as that of a conventional diesel-powered vehicle.

At this time there is a limited number of LNG fueling stations and LNG is not produced in California. All users of LNG have been receiving their supply via mobile transport. There is currently one major supplier of LNG who provides the fuel from Topac Arizona. Waste Management indicated their concern on LNG availability when the LNG fuel supplier indicated that they may not be able to make their scheduled delivery due to supply shortages (the liquefier plant in Arizona was down and the fuel supplier relied on a second supplier as a backup). Staff believes that there is a need to have LNG produced in California to help moderate costs and further ensure availability.

There is movement to build liquefiers in California. Pacific, Gas and Electric is planning to build a liquefier plant in northern California. In addition, Applied LNG Technologies (ALT), the major supplier of LNG from Arizona, recently announced plans to build a liquefier plant in Kern County converting landfill gas to LNG. The cost to build a plant ranges from about $3M to $5M. Lastly, the City of Long Beach is planning to build a liquefier in the South Coast Air Basin to service the city’s natural gas fleet and potentially offer surplus LNG to other fleets.

While the initial emphasis is to expand the supply of LNG, several waste hauling operators have indicated a preference for CNG and requested funding assistance under several funding assistance programs including the AES infrastructure funds and the Carl Moyer Program. Staff has visited with several waste hauling operators who have been utilizing alternative-fueled vehicles in their operations. One of the municipal operators is the City of Santa Monica Sanitation Department. The City of Santa Monica has been operating CNG curbside collection vehicles since 1996. At this time Santa Monica operates about 20 CNG curbside collection vehicles and an array of CNG transfer vehicles. The City of Santa Monica fleet includes a four-wheel drive CNG collection vehicle that operates along the beach, heavy-duty CNG dump trucks, and CNG streetsweepers. Staff was impressed with the wide variety of natural gas vehicles operated by Santa Monica, which included CNG parking enforcement and other light- and medium-duty natural gas vehicles.

Relative to the issue of availability and price, staff has placed an emphasis in bringing forward alternatives to the current supply of LNG. Staff believes that a second LNG supplier will place a greater emphasis on the California market in the interim. Staff is in discussions with a LNG fuel supplier based in Colorado on the potential to provide LNG to California markets. With the recent funding awards from the AES Settlement, several operators will be able to move forward in complying with Rule 1193.

Alternative-Fueled Engine/Chassis Configuration Availability and Application

Several operators expressed concerns that the types of vehicles they usually order are not available in a preferred alternative fuel engine configuration. Operators have been standardizing their operations through dealing with one or two equipment manufacturers. Because of the various spare parts and knowledge base for specific engine equipment, operators believe that staying with one or two manufacturers provides the most efficient form of operation. With the Rule 1193 requirements in place, some operators would have to purchase vehicles from one of the other vehicle manufacturers. For example, a fleet may consist of mostly vehicles made by Peterbuilt. At this time, Peterbuilt does not offer an alternative fuel engine configuration. Thus, the operator must look to other manufacturers in order to purchase a rule compliant vehicle. In addition, comments were made that having different manufacturer vehicles in one shop would lead to added expenses in terms of technician training and maintenance.

Staff also received comments regarding the capability of some alternative-fueled engine/chassis configurations to operate under a specific route or application. The City of Los Angeles commented that because of some the narrow alleys in the city, they need to specify a particular size for the chassis and many of the natural gas engines do not match the particular chassis size. Several operators have also indicated that even though they are moving forward with rule compliance, the lead-time to have an alternative-fueled vehicle delivered is much longer than the delivery time for a diesel-powered vehicle.

Staff acknowledges that there are a limited number of alternative-fueled engines offered by manufacturers at this time. One manufacturer, Mack, is actually overwhelmed with a recent order for over 100 waste collection vehicles from the San Diego area.

Staff surveyed the request for funding assistance in the purchase of waste collection vehicles and found that 272 alternative fuel vehicle purchases or repowers have been funded through the Carl Moyer Program, MSRC, or the Rule 2202 AQIP since 1998. The majority of the funding was for collection vehicles with a total funding of over $8.1M. In addition, FY 2000/01 Carl Moyer Program awards has not been made. However, several waste collection entities have applied for funding assistance.

Since Rule 1193 recognizes that certain alternative-fueled engine/chassis configurations may not be commercially available or could be used in specific applications, staff believes that there is sufficient flexibility for operators to implement Rule 1193 vehicle purchases at this time.

Status of Dual-Fuel Engine Technology

As part of the adoption of Rule 1193, concerns were raised that alternative fuel usage in dual-fuel engines under a curbside collection duty cycle was only about 40 percent compared to the rated 85 percent usage in on-highway cycles. Because of this concern, Rule 1193 allowed the purchase of dual-fuel curbside collection vehicles for a limited time. However, if the technology was improved such that the alternative fuel is primarily used under the curbside collection duty cycle and was certified by CARB as such, Rule 1193 could be potentially amended to allow for the purchase of such engine. In addition, there is a general recognition that beginning October 2002, dual-fuel engine emissions of oxides of nitrogen (NOx) may be greater than oxides of nitrogen emissions from alternative-fueled engines. To-date, there are two engine manufacturers that have dual-fuel engines certified to the optional NOx emission standard of 2.5 gm/bhp-hr, Power Systems (Caterpillar) and Cummins. The Cummins engine is a 12 liter engine used in Class 8 type vehicles and is not applicable for curbside collection vehicles. The Power Systems/Caterpillar engine has been the dual-fuel engine used in waste collection and on-highway heavy-duty vehicles. Power Systems recently indicated that they have resolved the alternative fuel usage issues under the curbside collection duty cycle. Power Systems is currently developing an engine that will have particulate emission levels similar to most natural gas engines. In addition, Power Systems indicated that some of their preliminary tests indicate that NOx emission levels may be below 2.0 gm/bhp-hr. Staff is hopeful that the latest test results are indicative of the future of dual-fuel engine technology. However, until an engine manufacturer demonstrates that the dual-fuel engines meet stated emission levels and the engines are certified by CARB as such, staff is not recommending revising or removing the sunset date.

Variance Process

Several operators commented that while there is a process (variance process) for operators to seek company-specific relief from Rule 1193 requirements, such process is uncertain and may leave a bad perception about the operator as violator of a rule or regulations. (Operators indicated to staff that municipalities require background criminal checks on companies before awarding franchises.) In addition, operators believe that the process would be time consuming and complex. Staff indicated that the variance process is used by a wide variety of operators and facilities under several conditions. In addition, short of the variance process, staff in conjunction with the AQMD Chief Prosecutors Office would work with individual operators to address specific compliance issues. Recently, a large waste collection operator disclosed to the AQMD that due to unforeseen circumstances, they must bring vehicles within a relatively short time frame. Staff worked with the operator and identified a means for the operator to move forward with collection service and provide additional emission reduction benefits under a stipulated order of abatement. The operator agreed to install particulate traps on the diesel vehicles purchased as soon as the traps are approved by CARB and convert an additional 20 existing diesel vehicles to alternative-fueled vehicles earlier than their normal turnover rate.) Staff believes that through such dialogue with affected parties, Rule 1193 can be implemented and additional emission reduction benefits will be achieved.

Cost to Implement Rule 1193

In recent months, waste hauling fleet operators indicated their continuing concerns about the additional cost to implement Rule 1193. Operators identified the costs associated with facility upgrades, technician training, additional fuel costs, and the need for additional vehicles if alternative-fueled vehicles do not perform as efficiently as their diesel counterpart. Because many of these operators rely on franchise agreements with local municipalities, they note that they cannot pass these costs onto the ratepayer. As such, some of the operators requested that the rule be amended to allow for a financial hardship exemption. At this time, staff has not received evidence demonstrating financial hardship. However, staff has received several comments that for a specific vehicle specification, the cost of the vehicle may be as much as $60,000 to $80,000 more than a diesel version. Staff reviewed prior funding assistance awards from the Carl Moyer Program and found that the average differential cost of an alternative-fueled vehicle compared to a diesel vehicle ranges from about $30,000 to $41,000. The differential cost of a dual-fuel vehicle compared to a diesel vehicle is about $26,000. Staff is working with the operators with the higher quotes to determine if the requested vehicles are more specialized and resulted in the increased costs.

Summary and Recommendation

In summary, operators are beginning to implement Rule 1193 through requests for funding assistance for alternative fueled vehicle purchases and infrastructure development. However, because of the lead-time to develop the alternative fuel refueling infrastructure, operators may be seeking relief from the rule requirements in the interim. Staff will continue to work with these operators to address their specific issues. In addition, staff will continue to place a strong emphasis on expanding the infrastructure and seeking funding assistance.

Relative to smaller operators, who are not required to comply with Rule 1193 until July 1, 2002, staff will continue an outreach with these operators through their industry association. Staff believes that with the expansion of the alternative fuel refueling infrastructure, smaller operators will be more comfortable with alternative fuel technologies.

In those instances where a specific alternative fuel engine/chassis application is not feasible, staff will work with affected parties to identify alternative means to meet the requirements of the rule. Staff does not believe that Rule 1193 requires amendments at this time. However, at a minimum, staff may bring forward rule amendments for dual-fuel technologies if a demonstration is made that such technologies will achieve stated emission reductions.

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