BOARD MEETING STATE OF CALIFORNIA AIR RESOURCES BOARD CALIFORNIA ENVIRONMENTAL PROTECTION AGENCY CENTRAL VALLEY AUDITORIUM, SECOND FLOOR 1001 I STREET SACRAMENTO, CALIFORNIA THURSDAY, MAY 16, 2002 9:00 A.M. JAMES F. PETERS, CSR, RPR CERTIFIED SHORTHAND REPORTER LICENSE NUMBER 10063 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 ii APPEARANCES BOARD MEMBERS Dr. Allan Lloyd, Chairperson Dr. William Burke Mr. Joseph Calhoun Mrs. Barbara Riordan Supervisor Ron Roberts Ms. Dorene D'Adamo Supervisor Mark DeSaulnier STAFF Mr. Mike Kenny, Executive Officer Mr. Tom Cackette, Deputy Executive Officer Mr. Mike Scheible, Deputy Executive Officer Ms. Lynn Terry, Deputy Executive Officer Ms. Kathleen Walsh, General Counsel Mr. David Chou, Air Resources Engineer Mr. Bart Croes, Chief, Research Division Mr. Bob Cross, Chief, Mobile Source Control Division Mr. Richard Bode, Chief, Health and Exposure Assessment Branch Ms. Annette Hebert, Chief, Heavy-Duty Diesel In-Use Stragegies Branch Dr. David Mazzera, Research Division PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 iii APPEARANCES CONTINUED STAFF Mr. Oliver, Senior Staff Counsel Mr. Scott Rowland, Manager, Retrofit Assessment Section Mr. Richard Vincet PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 iv INDEX PAGE Opening Remarks by Chairperson Lloyd 1 Pledge of Allegiance 1 Roll Call 2 Item 02-4-1 2 Chaiperson Lloyd 2 Executive Officer Kenny 3 Staff Presentation 3 Item 02-4-2 9 Staff Presentation 9 Motion 12 Vote 12 Item 02-4-3 12 Chairperson Lloyd 12 Executive Officer Kenny 14 Staff Presentation 14 Q&A 35 Ombudsman Tschogl 55 Bruce Bertelsen 57 Dawn Friest 59 Stephanie Williams 65 Paul Beck 89 Oreste Bevilacqua 101 Donel Olson 102 Brad Edgar 107 Motion 113 Vote 115 Public Comment 116 Adjournment 116 Reporter's Certificate 117 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 1 1 PROCEEDINGS 2 CHAIRPERSON LLOYD: Good morning. The May 16th, 3 2002, public meeting of the Air Resources Board will now 4 come to order. 5 Supervisor Roberts, would you please lead us in 6 the Pledge of Allegiance. 7 (Thereupon the Pledge of Allegiance 8 was recited in unison.) 9 CHAIRPERSON LLOYD: Will the Clerk of the Board 10 please call the roll. 11 BOARD CLERK DORAIS: Dr. Burke. 12 BOARD MEMBER BURKE: Present. 13 BOARD CLERK DORAIS: Mr. Calhoun. 14 BOARD MEMBER CALHOUN: Here. 15 BOARD CLERK DORAIS: Ms. D'Adamo. 16 BOARD MEMBER D'ADAMO: Here. 17 BOARD CLERK DORAIS: Supervisor Desaulnier. 18 Professor Friedman. 19 Dr. Friedman. 20 Mr. McKinnon. 21 Supervisor Patrick. 22 Mrs. Riordan. 23 BOARD MEMBER RIORDAN: Here. 24 BOARD CLERK DORAIS: Supervisor Roberts. 25 BOARD MEMBER ROBERTS: Here. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 2 1 BOARD CLERK DORAIS: Chairman Lloyd. 2 CHAIRPERSON LLOYD: Here. 3 Again, I would like to remind anyone in the 4 audience who wishes to testify on today's agenda items to 5 please sign up with the Clerk of the Board. 6 Also, if you have a written statement, please 7 give 30 copies to the Clerk of the Board. 8 Also, I would like to recognize -- I'm hoping 9 that one of our colleagues, Professor Friedman, may be 10 listening in. So, Professor, I'm sure we're in class, so 11 we'll get a grade from you. But hope you're feeling 12 better and hope you'll be able to join us next month. 13 First item on the agenda today is 02-4-1. 14 BOARD MEMBER BURKE: Mr. Chairman, I hate to 15 interrupt already, but I would like to send a little note 16 to Mr. -- Matt, because I think it's very nice of him to 17 have his name -- of Sacramento changed to Shaqramento. 18 Because, you know, for the next two weeks I just thought 19 that was really great of him. So -- 20 CHAIRPERSON LLOYD: Thank you. I'm sure we'll 21 have some fun over the next few weeks. 22 The first item is the monthly public health 23 update. I understand that today's health update deals 24 with fine particulate matter in the 2.5 micron range. I 25 think this is particularly important and timely since next PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 3 1 month at our June meeting the Board will be considering 2 proposed revisions to the State particulate standards for 3 various particle sizes. 4 Mr. Kenny, I'd like to turn over the Board 5 meeting to you to begin the staff presentation. 6 EXECUTIVE OFFICER KENNY: Thank you, Dr. Lloyd, 7 Members of the Board. 8 Before I begin, one thing I would mention is that 9 in addition to an audio broadcast, we also have a video 10 broadcast, just so everyone's aware of it. 11 This information will highlight recent findings 12 from a long-term epidemiological study evaluating the 13 relationship between PM2.5 and lung-cancer mortality and 14 cardiopulmonary mortality. Two important papers have been 15 published from the study. 16 The first of these, published in 1995, was 17 considered controversial due to its conclusions about the 18 fine-particle air pollution and cardiopulmonary deaths and 19 methodologies. 20 The latest study, published in March of this 21 year, is a follow-up to the original publication and 22 attempts to address the criticisms of the original paper. 23 Not only are the latest results of the study 24 important to our role in studying air quality standards, 25 but this gives us insight into the role of research and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 4 1 providing the necessary information to support our work. 2 And with that, I'd like to ask Mr. Dave Mazzera 3 to present the findings from the study. 4 MR. MAZZERA: Thank you, Mr. Kenny. 5 Good morning, Chairman Lloyd and Members of the 6 Board. 7 (Thereupon an overhead presentation was 8 presented as follows.) 9 MR. MAZZERA: Today, we'll present the results of 10 a recent study regarding the long-term exposure to fine 11 particulate matter and associated mortality effects. 12 --o0o-- 13 MR. MAZZERA: As you are aware, staff have been 14 reviewing the California air quality standards for 15 particulate matter and will bring proposed recommendations 16 to the Board in June. 17 One of the key elements supporting the proposed 18 recommendations are the results from epidemiology studies 19 which provide a link to an exposure to particulate air 20 pollution and adverse health effects. 21 As you recall, you were briefed in March on a 22 recent study on a short-term exposure to fine particulate 23 matter, defined as particulate matter of 2.5 micrometers 24 or less, and heart disease, thus conveying the 25 significance of short-term standards and protecting public PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 5 1 health. 2 Today, I would like to present the results of a 3 recent study on long-term exposure to fine particulate 4 matter and associated mortality from cardiopulmonary 5 disease and lung cancer. 6 --o0o-- 7 MR. MAZZERA: Over the past decade several 8 studies have evidenced the link between exposure to fine 9 particular matter and adverse health effects. One study, 10 the 1995 American Cancer Society sponsored study, or ACS 11 study, concluded that annual mortality due to 12 cardiopulmonary disease and lung cancer increased in 13 association with the increase in fine particulate matter 14 concentrations. 15 Results from the 1995 ACS study came under 16 intense scrutiny in 1997 when the U.S. Environmental 17 Protection Agency used it in support of new national 18 ambient air quality standards for PM2.5. This study was 19 labeled controversial because of uncertainty in the 20 methodologies used in the analysis. As a result and due 21 to its significance in the standard-setting process, an 22 independent reanalysis was performed in 2000, which 23 assured the quality of the data set and validated the 24 findings of the 1995 ACS study. 25 In March of this year, the primary authors of the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 6 1 1995 ACS study published a follow-up study entitled "Lung 2 Cancer, Cardiopulmonary Mortality, and Long-Term Exposure 3 to Fine-particulate Air Pollution." Findings of this 4 follow-up study are the focus of this health update. 5 --o0o-- 6 MR. MAZZERA: The 2002 follow-up study evaluated 7 approximately 500,000 adults, linking air pollution data 8 from numerous metropolitan areas around the U.S. to vital 9 statistics data and death data from the American Cancer 10 Society study data base. 11 It also had the following important advantages 12 over its predecessor: 13 It doubled the follow-up time of individuals 14 being monitored to more than 16 years. The exposure data 15 was substantially expanded, including new PM2.5 data and 16 gaseous co-pollutant data. The analysis used advanced 17 techniques for controlling potential confounding to ensure 18 that report associations were indeed due to exposure to 19 fine particulate matter; not unduly influenced by 20 individual risk factors like smoking, alcohol consumption, 21 body weight, diet, education, and marital status; as well 22 as the potential differences in the fine particulate 23 matter concentrations within a region that may affect 24 underlying exposure assumptions and exposure to 25 co-pollutants like coarse particles or gases. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 7 1 Finally, the 2002 follow-up study later -- the 2 2002 follow-up study had a better, more robust ability 3 than the early study to evaluate morality from lung cancer 4 due to increased follow-up time and number of deaths. 5 --o0o-- 6 MR. MAZZERA: The results of the 2002 follow-up 7 study showed significant association between PM2.5 and 8 elevated risks for cardiopulmonary and lung-cancer 9 mortality. 10 The study found that each 11 10-microgram-per-cubic-meter increase in long-term average 12 PM2.5 concentrations was associated with approximately a 4 13 percent increased risk of death from all natural causes, a 14 6 percent increased risk of death from cardiopulmonary 15 disease, and an 8 percent increased risk of death from 16 lung cancer. 17 Associations were also found with 18 sulfur-containing air pollution but not other gaseous 19 pollutants. 20 On the other hand, measures of coarse particles 21 were not consistently associated with mortality. 22 --o0o-- 23 MR. MAZZERA: As the study researchers indicated 24 in the press release for this study, the lung-cancer risk 25 associated with risk exposure to fine particulate matter PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 8 1 is comparable to that faced by nonsmokers who live with 2 smokers and are exposed long term to secondhand cigarette 3 smoke. 4 --o0o-- 5 MR. MAZZERA: In summary, this recent study 6 provides the strongest to date that long-term exposure to 7 fine particulate matter, or PM2.5, is an important risk 8 factor in cardiopulmonary and lung-cancer mortality. 9 Also, the extended follow-up period provided the 10 opportunity to determine, with a greater confidence than 11 the original study, a positive association between fine 12 particulate matter air pollution and lung-cancer related 13 deaths. 14 Of equal importance, the results of this study 15 validated results from earlier studies as well as supports 16 the need for annual or long-term PM2.5 standard. 17 This concludes our presentation. 18 Thank you. We'll be glad to answer any questions 19 that you may have. 20 CHAIRPERSON LLOYD: Thank you. 21 It clearly demonstrates that we need to continue 22 our efforts to reduce exposure to all pollutants, 23 particularly the particulates here; not only our standards 24 which will be coming up next month, but also 25 emission-control efforts as well. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 9 1 Do my colleagues have any questions, comments? 2 BOARD MEMBER RIORDAN: I don't have a question, 3 Mr. Chairman, but just a comment. 4 First of all, the staff had briefed me earlier on 5 this. And I think the real significance is the validation 6 of the earlier study that had some critical comments; and 7 when we begin to, as you said, move forward with some of 8 the things that we're going to need to do, this study, I 9 think, validates why we are moving forward. And I 10 appreciate the staff's bringing it to us at this time, 11 because it will be very helpful for next month and in the 12 end different other initiatives that we're going to take 13 during this next year. 14 So thank you very much. 15 CHAIRPERSON LLOYD: Thank you. 16 Thanks very much. 17 No testimony, I guess. This is not a regulatory 18 item. It's not necessary to officially close the record. 19 So we will move to our next agenda item, 02-4-2. And this 20 is the consideration of three research proposals. 21 And do the staff have anything to say on these 22 proposals? 23 Moving a little bit too quickly here. 24 (Thereupon an overhead presentation was 25 presented as follows.) PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 10 1 MR. VINCET: Good morning, Chairman Lloyd and 2 Members of the Board. I'm Richard Vincet from the 3 Research Division. 4 The staff is recommending today your approval of 5 two new research contracts and an augmentation to an 6 existing contract. Now, the total value of these is about 7 a half million dollars. 8 The projects would be useful to Regulatory 9 Development and other Board programs. And the proposals 10 have all been approved by the Research Screening 11 Committee. 12 --o0o-- 13 MR. VINCET: The first proposed project would 14 investigate the use of statistical analysis of historical 15 data to discern health and economic benefits corresponding 16 to reduced air pollution. 17 The contractor would examine trends in 20 years 18 of data from the south coast air basin to look for 19 relationships between air quality and health outcomes such 20 as death and hospitalizations. 21 The analysis would take into account confounding 22 factors such as changing demographics and health care. 23 Because of the study's complexity, we will 24 establish a five-person external advisory committee to 25 assist in the development of the project. The Committee PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 11 1 will include experts in epidemiologic -- epidemiology 2 statistics, personal exposure, and air-quality data. 3 --o0o-- 4 MR. VINCET: Quantifying the health benefits of 5 the decreasing air pollution in the south coast area would 6 greatly add to the ARB's knowledge of the benefits of its 7 air quality control programs. 8 In the second proposed project, the contractor 9 would identify and obtain low VOC cleaning materials, test 10 their efficacy in the lab, and test their utility in 11 actual commercial applications. The goal is to identify 12 formulations for effective products that will meet ARB's 13 standards on the composition of brake cleaners and other 14 automotive cleaning products. Also, the results might 15 justify setting lower VOC standards for such products. 16 --o0o-- 17 MR. VINCET: The final proposal is a small 18 augmentation to an existing contract to measure 19 evaporative emissions from lawn and garden equipment. The 20 staff needs data on reduction of emissions on plastic 21 gasoline tanks which are fluorine treated to prevent 22 permeation through the walls. Such data are needed to 23 estimate the cost effectiveness of a regulation that is 24 being developed. 25 The data can best be obtained by placing tanks -- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 12 1 treated tanks on pieces of equipment whose emissions are 2 being measured in a current emission inventory project 3 with Automotive Testing Laboratories. ATL has virtually 4 completed its contract to testing of 40 pieces of 5 equipment. 6 That concludes the presentation. And the staff 7 is available to answer any questions. 8 Thank you. 9 CHAIRPERSON LLOYD: Thank you very much. I don't 10 know whether -- I don't know if we have any questions. 11 Do we have a motion to put -- Supervisor 12 Desaulnier. 13 BOARD MEMBER DeSAULNIER: To demonstrate that I'm 14 physically present, I would move the recommendations. 15 BOARD MEMBER RIORDAN: I'll second the motion. 16 CHAIRPERSON LLOYD: All in favor say aye. 17 (Ayes.) 18 CHAIRPERSON LLOYD: Thank you. 19 We'll allow a moment before while we change staff 20 before we go on to the third item. 21 The next item on the agenda today is 02-4-3, 22 consideration of a proposed diesel emission control 23 strategy verification procedure, warranty, and in-use 24 compliance requirements for on-road, off-road, and 25 stationary diesel fuel vehicles and equipment. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 13 1 Diesel-fueled vehicles and equipment play a key 2 role in the transportation of goods in California. Thus, 3 the effective use of diesel-fueled vehicles and equipment 4 is vital to a strong economy. Controlling diesel 5 emissions is also vitally important from an air quality 6 and public health perspective. 7 Diesel-particulate matter was identified by the 8 Air Resources Board as a toxic air contaminant in 1998. 9 The diesel risk reduction plan, adopted by the Board in 10 2000, established a goal of reducing 11 diesel-particulate-matter emissions in virtually all 12 in-use diesel engines in California by 2010. 13 To meet this goal, staff is developing various 14 measures, including more stringent standards for new 15 diesel-fueled vehicles and equipment, a lower sulfur limit 16 for diesel fuel, and emission control strategies for 17 existing diesel engines. To effectively implement 18 emission controls for existing engines, it becomes 19 apparent that a method of evaluating the diesel emission 20 control devices and strategies is desperately needed. The 21 proposal today before us describes the procedure that 22 would be used to verify those diesel emission control 23 strategies. 24 At this point, I would like to turn it over to 25 Mr. Kenny to begin staff presentation. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 14 1 EXECUTIVE OFFICER KENNY: Thank you, Mr. Chairman 2 and Members of the Board. 3 The proposed verification procedure would verify 4 emission reductions in diesel-particulate matter and 5 oxides of nitrogen from use in control technologies that 6 can be applied to existing diesel engines. Those control 7 strategies include, but aren't limited to, diesel 8 oxidation catalysts, diesel-particulate filters, selective 9 catalytic reduction converters, fuel additives and 10 alternative diesel fuels. The procedure would require 11 applicants to perform emission testing, conduct a 12 durability demonstration, demonstrate products in actual 13 field use, and provide warranties. 14 The proposal also requires the in-use compliance 15 testing to ensure the production units in the field are 16 achieving emission reductions consistent with the levels 17 to which they were verified. 18 I would now like to turn the presentation over to 19 Mr. David Chow, who will provide you with an overview of 20 the staff's findings and present the staff's 21 recommendations. 22 (Thereupon an overhead presentation was 23 presented as follows.) 24 AIR RESOURCES ENGINEER CHOU: Thank you. 25 Good morning, Dr. Lloyd and Members of the Board. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 15 1 My name's David Chou and I'm on the staff of the 2 Heavy-Duty Diesel In-use Strategies Branch. I will be 3 presenting the staff's proposed diesel emission control 4 strategy verification procedure. 5 --o0o-- 6 AIR RESOURCES ENGINEER CHOU: I would first 7 provide you with a general background of the diesel risk 8 reduction plan and how this verification procedure was 9 supposed to be spent. Then I will discuss the proposed 10 verification procedure, including the objectives of the 11 procedure, application process, the emission testing that 12 will be required, the durability and fuel demonstrations, 13 the warranty requirements, the in-use compliance 14 requirements, the verification for alternative diesel 15 fuels, and the changes from the published proposal on 16 March 29th. 17 Finally, I will summarize the staff's 18 recommendation. 19 --o0o-- 20 AIR RESOURCES ENGINEER CHOU: The diesel engine 21 plays a vital role in the world economy, supporting much 22 of our land and sea transportation, generating electrical 23 power, and powering many vehicles and equipment that 24 support agriculture, industry, and construction. The 25 reason is simply that the diesel engine is more fuel PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 16 1 efficient and costs less to operate than a comparable 2 gasoline engine. But diesel engines generate higher 3 levels of PM and NOx than comparable gasoline engines, and 4 concern is growing for how diesel pollution is impacting 5 public health and the environment. 6 --o0o-- 7 AIR RESOURCES ENGINEER CHOU: In August 1998 the 8 Air Resources Board identified diesel PM as a toxic air 9 contaminant following a 10-year review process. Compared 10 to other air toxics the Board has identified and 11 controlled, diesel PM emissions are estimated to be 12 responsible for almost 70 percent of the total ambient air 13 toxics risk. 14 --o0o-- 15 AIR RESOURCES ENGINEER CHOU: To ensure that the 16 health risks from exposure to diesel PM are readily 17 reduced, the ARB adopted the diesel risk reduction plan in 18 September 2000. There were 14 new control measures 19 proposed by this plan, which include more stringent 20 emission standards for new engines, cleaner diesel fuel, 21 and a major effort to retrofit the existing on-road, 22 off-road and stationary diesel engines. 23 It is our goal to reduce 75 percent of the risk 24 by 2010. To achieve this, it would be necessary to 25 retrofit virtually all existing diesel engines in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 17 1 California. 2 --o0o-- 3 AIR RESOURCES ENGINEER CHOU: There are many 4 diesel emission control strategies that can be applied to 5 existing diesel engines. They include, but are not 6 limited to, diesel oxygen catalysts, diesel particulate 7 filters, fuel additives, alternative diesel fuel, exhaust 8 gas recirculation systems, and selective catalytic 9 reduction systems. Those structures have been 10 successfully demonstrated in a variety of applications, 11 such as refuse haulers, long-haul trucks, school buses, 12 construction equipment, and emergency generators. 13 To effectively implement any of the emission 14 control measures for existing engines, ARB needs a 15 standard procedure to verify the emission reductions from 16 various diesel emission control systems. 17 --o0o-- 18 AIR RESOURCES ENGINEER CHOU: The objectives of 19 the verification procedure are to determine if the 20 emission reductions for diesel emission control systems 21 are real and durable. This includes understanding the 22 signs; quantify those emission reductions; and ensure the 23 production units in the field are achieving emission 24 reductions which are consistent with their verification 25 through an in-use compliance program. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 18 1 --o0o-- 2 AIR RESOURCES ENGINEER CHOU: In developing the 3 diesel risk reduction plan, staff originally envisioned a 4 requirement that diesel emission control strategies 5 achieve either a PM emission rate of.01 grams per 6 brake-horsepower-hour or an 85 percent or greater PM 7 reduction. These levels were based on the performance of 8 passive diesel particulate filters which use a catalyst 9 and the heat of the engine exhaust to burn the soot 10 collected. However, subsequent investigation and field 11 trials have indicated that current capacity of particulate 12 filters cannot be used on some applications and engines. 13 Other passive filters may not yet be appropriate for all 14 applications. There are other technologies such as diesel 15 oxygen catalysts that can reduce PM emissions, although 16 not so efficiently. 17 In recognition of this the staff is proposing a 18 three-level verification system: 19 A Level 1 strategy would reduce PM by a minimum 20 of 25 percent, but a Level 2 strategy will reduce PM by a 21 minimum of 50 percent. 22 Level 3 strategies will be those that reduce PM 23 by a minimum of 85 percent or reduce emission to less than 24 or equal to .01 grams per brake-horsepower-hour. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 19 1 AIR RESOURCES ENGINEER CHOU: An example of a 2 Level 2 strategy will be a diesel oxidation catalyst. An 3 example of a Level 2 strategy could be a water emulsified 4 diesel fuel. Examples of Level 3 strategies would be 5 active and passive diesel particulate filters as well as a 6 fuel-borne catalyst used in conjunction with a diesel 7 particulate filter. These are just examples. Its 8 technology must be fully evaluated before being 9 categorized into a specific level. 10 This three-level approach should broaden both the 11 spectrum of control technologies available to participate 12 in California's diesel emission control efforts and the 13 number of applications that can be controlled. 14 It should be noted that, while staff is 15 recommending a multi-level approach to verification, we 16 are not deviating from the goal to achieve the maximum 17 reductions in diesel PM that are economically and 18 technologically feasible. The staff plans to develop 19 implementation regulations that would require the highest 20 level of verified emission control available. 21 In this manner the proposal will promote the 22 development of highly efficient technologies for all 23 applications, while ensuring that some emission reductions 24 are achieved for virtually every engine in a timely 25 manner. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 20 1 --o0o-- 2 AIR RESOURCES ENGINEER CHOU: To apply for 3 verification of a control strategy, the applicant is 4 required to contact staff and provide some basic 5 information about strategy, including a description of the 6 operating principles and outlining of the plan for meeting 7 the requirements. The applicants may also submit 8 assisting test data or fuel experience to determine if 9 they may be used to satisfy any other testing 10 requirements. 11 Staff would then work with the applicant to 12 determine the applicability of the control strategy and 13 help determine an appropriate emission control group. 14 --o0o-- 15 AIR RESOURCES ENGINEER CHOU: Emission control 16 groups are the means by which staff proposes to verify 17 emission control strategies. 18 The definition of emission control group is a set 19 of diesel engines and applications defined by various 20 engine and application parameters that are relevant to the 21 performance of a particular diesel emissions control. 22 Categorizing in this way should minimize testing. By 23 focusing on the differences in engines and applications, 24 that would truly affect the operation of a diesel emission 25 control strategy. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 21 1 The examples shown here is for a passive diesel 2 particulate filter. The PM level the engine was certified 3 to is important because it indicates the rate at which the 4 filter will accumulate PM. Since the engine is a four 5 stroke rather than a two stroke, the exhaust temperature 6 is expected to be somewhat higher and the amount of oil 7 consumed would be less. 8 Duty cycle will also affect the exhaust 9 temperature. In its proposal, the applicant should 10 suggest the emission control group parameters based on the 11 nature of its system. Staff will then work with the 12 applicant to determine the emission control groups for the 13 strategy. 14 To ensure that an emission control strategy is 15 durable, the applicant must demonstrate successful 16 extended operation of its diesel emission control strategy 17 with at least one representative vehicle or engine 18 belonging to the appropriate emission control group. 19 The minimum durability demonstration for on-road, 20 off-road and stationary applications is 50,000 miles or 21 1,000 hours. 22 As stationary and emergency generators typically 23 experienced less sustained operation, staff proposes a 24 500-hour durability demonstration for them. 25 To help minimize the burden on an applicant, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 22 1 staff proposes to evaluate existing data to determine 2 whether it is sufficient to meet this requirement. 3 Similarly, staff will consider existing experience and 4 engineering justification to determine whether additional 5 emission control groups would require separate durability 6 demonstrations. 7 Applicants may have in-field or laboratory-based 8 durability demonstration. If the durability demonstration 9 selected is laboratory-based, an additional field 10 demonstration would be required. 11 --o0o-- 12 AIR RESOURCES ENGINEER CHOU: The purpose of the 13 field demonstration is to see if the diesel emission 14 control strategy is comparable with the emission control 15 group selected and how it will perform on the real-world 16 conditions. For example, how much back pressure is 17 imposed on the engine and if the operator notes any 18 effects; how the system handles real-world vibrations; and 19 what maintenance issues may turn up are all issues that 20 could be identified with a field demonstration. 21 As noted, the separate field demonstration would 22 be required when a main durability demonstration is 23 conducted in the laboratory. The field demonstration will 24 not be nearly as extensive as the durability 25 demonstration. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 23 1 A minimum of 10,000 miles or 200 hours is 2 required. In short, staff wants to verify the applicant's 3 system is technologically mature and ready for real-world 4 application. 5 --o0o-- 6 AIR RESOURCES ENGINEER CHOU: The proposed 7 procedure specifies preferred test cycles for emissions 8 testing. 9 For on-road applications applicants can choose 10 either engine or chassis testing. 11 For engines testing, the transient heavy-duty 12 federal test procedure used for new engine certification 13 is preferred, and one cold and three hot-start tests are 14 required. 15 However, for chassis testing the applicant should 16 conduct testing on the Urban Dynamometer Driving Schedule, 17 UDDS, with one cold and three hot-start tests and on the 18 low-speed cycle with three hot-start tests. 19 The appropriate low-speed cycle will be proposed 20 by the applicant. The UDDS represents freeway driving 21 conditions, while a low-speed cycle such as the New York 22 bus cycle represents urban start-and-go driving 23 conditions. 24 For off-road and stationary applications, the 25 applicant should choose the appropriate study cycle with PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 24 1 three hot-start tests as outlined in the ARB off-road 2 regulations. 3 The applicant may request staff to approve 4 alternative test cycles. This provision would simplify 5 the use of existing data from other countries and provide 6 additional flexibility to the procedure. 7 --o0o-- 8 AIR RESOURCES ENGINEER CHOU: The emission 9 testing would be conducted at the beginning and end of the 10 durability period. However, only one baseline test we 11 felt the diesel emission control system would be required. 12 The emissions to be measured include particulate 13 matter, oxides of nitrogen, nitrogen dioxide, total 14 hydrocarbons, carbon monoxide, and carbon dioxide. 15 For systems that include particulate filters, the 16 engine back pressure and exhaust temperature must be 17 measured on a second-by-second basis during the baseline 18 run and each test run. 19 In addition, if there is reason to believe that 20 the use of a diesel emission control system may result in 21 the increase of toxic air contaminants or other harmful 22 compounds, staff will reserve the right to ask for exhaust 23 analyses of these contaminants. 24 --o0o-- 25 AIR RESOURCES ENGINEER CHOU: If the applicant PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 25 1 chooses to ask for verification of NOx reductions, some 2 additional requirements would apply. First of all, to 3 ensure the emission reductions are statistically 4 significant, staff proposes a minimum verified reduction 5 for NOx of 15 percent. To maintain the same statistical 6 level of competence as PM, which requires a minimum PM 7 reduction of 25 percent, staff proposes that five 8 hot-start test runs will be required to detect NOx 9 emission reductions between 20 and 25 percent; while nine 10 hot-start test runs would be required to detect emission 11 reductions between 15 to 20 percent. Note that 10 percent 12 is the test to test verifiability of the emission test 13 use. 14 --o0o-- 15 AIR RESOURCES ENGINEER CHOU: Verification we 16 impose safeguards to protect the end user. For example, 17 the applicant will be required to provide a warranty with 18 minimum coverage as shown. Note that minimum warranty 19 periods vary according to the engine size and type. 20 For instance, the minimum warranty for heavy 21 heavy-duty engines is 5 years or 150,000 miles. 22 During the warranty period the emission control 23 strategy provided will be liable for any defects of the -- 24 in the diesel emission control system that present 25 themselves in the course of normal operation. The defects PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 26 1 may be structural, mechanical or chemical in nature. 2 Further, the diesel emission control system will 3 be considered as defective if during the warranty period 4 emission control performance falls below the verified 5 level. The warranty also extends to engine damage caused 6 by a defective control strategy. 7 --o0o-- 8 AIR RESOURCES ENGINEER CHOU: The performance of 9 diesel emission control systems will be evaluated through 10 the in-use compliance testing whenever at least 50 units 11 are sold in California. Manufacturers must submit in-use 12 compliance testing plans for approval by the executive 13 officer prior to testing. 14 In general, manufacturers must follow the same 15 test cycles used for verification. However, if such 16 in-use testing is overly burdensome to the manufacturers 17 or end users, manufacturers may propose a scientifically 18 sound alternative. 19 The two phases of in-use testing: 20 The first phase will be conducted after the 21 diesel emission control systems have been operated for at 22 least one year or within three months of their first 23 scheduled maintenance, whichever comes first. 24 The second phase would be conducted after the 25 systems have been in operation between 60 and 80 percent PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 27 1 of the warranty period. Between four to ten units would 2 be tested at each phase, depending on how many units fail 3 the test. 4 Staff from ARB and U.S. EPA have worked together 5 to develop the in-use compliance program, thus 6 manufacturers would need to go through only one in-use 7 compliance program to meet requirements of ARB and U.S. 8 EPA. 9 --o0o-- 10 AIR RESOURCES ENGINEER CHOU: To pass, the diesel 11 emission control system must achieve at least 90 percent 12 of its verified level and at least 70 percent of all units 13 tested will have to pass. 14 If a diesel emission control strategy fails, the 15 applicant must submit a detailed analysis of the failure. 16 In addition, the applicant must submit a remedial report 17 and recommend measures to correct or replace the failed 18 systems. Based on the remedial report and other relevant 19 information, the executive officer may revoke verification 20 or lower the control strategy to a lower verification 21 level. 22 --o0o-- 23 AIR RESOURCES ENGINEER CHOU: Fuel-based 24 strategies, such as fuel additives and alternative diesel 25 fuels, will also be subject to some additional PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 28 1 requirements to ensure the use would not lead to other 2 environmental problems. 3 Specifically, fuel-based strategies must undergo 4 review by the California Environmental Policy Council and 5 comply with the Health and Safety Code sections requiring 6 testing of multimedia effects. The California 7 Environmental Policy Council must determine that use of 8 the additive or alternative diesel fuel will not cause a 9 significant adverse impact on the public health and the 10 environment. 11 --o0o-- 12 AIR RESOURCES ENGINEER CHOU: For fuel additives, 13 the proposal contains further safeguards to ensure proper 14 usage and minimize secondary emissions. Fuel additives 15 must be used in conjunction with a diesel particulate 16 filter, unless proven safe to use alone. 17 Additional emissions tests at high doses are 18 required for fuel additives containing metal to detect any 19 changes in emission characteristics and the consequences 20 of misdosing. Every two years the applicants are required 21 to submit up-to-date environmental, technological and 22 other health-related data pertaining to the fuel additive. 23 Finally, a fuel level monitor will be required to 24 check the fuel additive level or any other on-board dosing 25 strategies -- for any on-board dosing strategies. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 29 1 --o0o-- 2 AIR RESOURCES ENGINEER CHOU: The other fuel 3 based control strategies will be alternative diesel fuels. 4 Alternative diesel fuels are not reformulated diesel fuel 5 and do not require engine or fuel system modification for 6 the engine to operate. Though minor modifications such as 7 recalibration of the engine fuel control is allowed. 8 Examples of alternative diesel fuels are 9 biodiesel, which is derived primarily from animal fats and 10 vegetable oil, and water emulsified diesel. 11 --o0o-- 12 AIR RESOURCES ENGINEER CHOU: To verify a 13 strategy involving an alternative diesel fuel the 14 applicant must provide information on the chemical and 15 physical properties of the alternative diesel fuel, 16 including information on possible toxics formation 17 associated with the use. 18 Because of the difficulty in determining fuel 19 defects, which are sometimes a change of only a few 20 percent, the procedure calls for increased engine testing. 21 For instance, a minimum of 21 hot-start emission tests is 22 required to establish an acceptable statistical level of 23 competence. 24 The engine testing is consistent with other ARB 25 programs, such as the interim procedure for certification PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 30 1 of emission reductions for alternative diesel fuels, and 2 data gathered for that program would be acceptable. Once 3 their testing has been performed for one emission control 4 group, additional emission control groups may require less 5 testing. The determinations will be made on a 6 case-by-case basis. 7 Other requirements that include the alternative 8 diesel fuels must be registered with the U.S. EPA or 9 receive U.S. EPA's approval for sale. And the alternative 10 diesel fuel must also be registered with the California 11 Department of Food and Agriculture. 12 --o0o-- 13 AIR RESOURCES ENGINEER CHOU: To expedite the 14 development of control systems for the smaller volume 15 off-road and stationary applications, staff proposes that 16 a condition of verification be offered for those 17 categories. If staff determines that a diesel emission 18 control strategy is technologically sound and appropriate 19 for the intended application, a conditional verification 20 could be granted to the applicant for off-road and 21 stationary applications. 22 To qualify for conditional verification, the 23 applicants must have completed at least 33 percent of the 24 minimum durability demonstration. In addition, 25 conditional verification will be granted to alternative PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 31 1 diesel fuels that are in the U.S. EPA's registration 2 process and that have been granted a research and 3 development extension allowing limited use. 4 The conditional verification will be limited to 5 those same uses. The applicant must complete the full 6 durability demonstration and other requirements within one 7 year after receiving the conditional verification. 8 --o0o-- 9 AIR RESOURCES ENGINEER CHOU: An issue that arose 10 during development of this proposal concerns measurements 11 of NOx, which consist of NO and NO2ï. Diesel vehicles 12 equipped with catalyzed filters have shown an increase of 13 NO2ï, for the total NOx emissions remain approximately the 14 same. 15 This issue was raised with the International 16 Diesel Retrofit Advisory Committee because the increase of 17 NO2ï may produce increased ozone, ambient NO2ïï, and PM and 18 was -- modeling was used to determine an appropriate limit 19 of NO2 ïto NOx ratio for the catalyzed filters. 20 Some results of the study are shown here. At an 21 NO2 ïto NOx ratio of 20 percent, the population exposure to 22 ozone levels above the 24-hour state ozone standard would 23 be slightly reduced. Winter peak NO2ï would increase, but 24 will remain well below the state ambient air quality 25 standard. And both summer and fall PM2.5 would decrease. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 32 1 Based on this study, staff proposes a limit of 20 2 percent for NO2ï to NOx ratio for any diesel emission 3 control strategy. 4 Manufacturers of catalyzed systems are working to 5 reduce NO2ï emissions. To provide time for development of 6 revised systems, while maintaining the aggressive 7 reduction of public exposure to diesel PM called for in 8 the diesel reduction plan, staff proposes that this limit 9 go into effect with the system verified after January 1st, 10 2004. This would allow the continued marketing of the PM 11 control strategies developed in good faith prior to this 12 hearing, but limit the overall NO2 ïincrease. 13 --o0o-- 14 AIR RESOURCES ENGINEER CHOU: Since the mail-out 15 on March 29, 2002, staff has continued its discussions 16 with stakeholders. Based on those discussions, staff 17 proposes the following changes from the original proposal. 18 Staff proposed that any increase of pollutants 19 associated with the application of any diesel emission 20 control strategy should be limited to 10 percent. 21 However, for certain applications, an increase of 22 non-methane hydrocarbons exceeds the 10 percent limit 23 despite the more significant reduction in PM and NOx. 24 To allow short-term implementation of its 25 effective PM control strategies, staff proposes allowing PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 33 1 the decrease of NOx to offset the increase of non-methane 2 hydrocarbons provided the final sum is lower than the 3 baseline. 4 This would be acceptable until July 1st, 2006, 5 which should allow the manufacturers time to reformulate 6 their products to meet the 10-percent limit. 7 After July 1st, 2006, manufacturers will be 8 allowed to offer diesel emission control systems that 9 exceed the 10-percent limit provided they submit 10 atmospheric modeling data to demonstrate that their 11 systems will not adversely impact the air quality. 12 Another change staff proposes is the executive 13 officer would waive the low-speed chassis test cycle. One 14 chassis test cycle will sufficiently address the operation 15 and typical duty cycle of an emission control group. 16 To allow flexibility in measuring NO2ï, staff 17 proposes that a dual path be analyzed acceptable for 18 measuring NO2ï. 19 Regarding noise control, staff proposes to 20 eliminate requirement for the applicant to maintain a list 21 of vehicles or equipment that comply with all applicable 22 noise limits. In this way, we will cut down the data 23 management burden on the applicants. The noise control 24 provision was originally included for consistency with the 25 California Highway Patrol requirements. And the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 34 1 California Highway Patrol has agreed that the modification 2 would meet their needs. 3 --o0o-- 4 AIR RESOURCES ENGINEER CHOU: The staff also 5 proposed that the executive officer have the option to -- 6 of requesting additional in-use testing when warranty 7 claims exceed 4 percent. This was revised to be 8 consistent with similar warranty claims thresholds used in 9 other programs. And installation warranty is also 10 proposed that covers the workmanship and materials for the 11 installation of the diesel emission control systems. 12 As mentioned earlier, the multimedia assessment 13 slide, staff has proposed a multimedia assessment for fuel 14 additives and alternative diesel fuels. This is to ensure 15 that the use of additive or alternative diesel fuel would 16 not cause a significant adverse impact on the public 17 health and the environment. 18 Another change staff proposes is that the fuel 19 additives must be registered with the U.S. EPA. This is 20 simply a clarification to make explicit staff's intent. 21 For a fuel additive that is mixed with diesel 22 prior to introduction to a vehicle or equipment, the fuel 23 additive and diesel mixture will be both treated and 24 evaluated as an alternative diesel fuel. 25 Finally, staff is proposing a number of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 35 1 nonsubstantive clarifications and corrections. 2 In summary, the proposed voluntary verification 3 procedure is technically and economically feasible. This 4 procedure will ensure that the emissions reductions from 5 diesel emission control systems are real and durable. We 6 have taken steps to minimize the costs of compliance, 7 while assuring a technically sound outcome. Staff has 8 worked to ensure the proposed procedure is consistent with 9 the U.S. EPA verification protocol. Manufacturers may use 10 the same test results to fulfill the basic requirements of 11 both programs. 12 Adoption of this proposed procedure will expedite 13 the implementation of the in-use strategy rules covered by 14 the diesel risk reduction plan. 15 --o0o-- 16 AIR RESOURCES ENGINEER CHOU: Therefore, staff 17 recommends the adoption of the proposed verification 18 procedure presented today. 19 This concludes my presentation. Thank you for 20 your attention. 21 CHAIRPERSON LLOYD: Thank you very much. 22 I had a few questions. 23 When you talk about the potential technology, 24 you've got the Level 1 diesel oxidation catalyst. Any 25 limitations on the application of the catalyst to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 36 1 vehicles, age of the vehicles, engine emissions, et 2 cetera? You know, we're aware of some of those for 3 filters. But could we go out and -- would it be a benefit 4 if we put a diesel oxidation catalyst on all diesel 5 engines? 6 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 7 HEBERT: Well, the future regulations for implementation 8 of the strategies were required and the highest level be 9 applied. As these technologies are going through our 10 verification process, they will basically apply for 11 certain grouping of vehicles. And in the case of an 12 oxidation catalyst, you know, there may be a likelihood 13 that they say, well, this can work on anything and 14 everything. 15 We have not verified -- oh, we verified one 16 diesel oxidation catalyst at this time, but it's in for a 17 particular engine grouping or particular engine 18 manufacturer, that is, on the long-haul operations. It 19 has not been extended to every engine out there. But they 20 can eventually come to us an say, well, oxidation 21 catalysts will work on everything out in the field. 22 But in the implementation regulations, as I said, 23 our intent is to require the highest level be applied. 24 CHAIRPERSON LLOYD: When we talk about in-use 25 compliance testing, it says here that the manufacturer PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 37 1 conducts testing under ARB supervision. What would that 2 mean? So if we have a truck operating one of these 3 devises, would that mean that that truck would be taken 4 out of service for the testing? How would that work? 5 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: 6 Basically -- I'm Scott Rowland. I'm Manager of the 7 Retrofit Assessment Section. 8 Basically, what that means is that we would 9 follow the testing that is done. Essentially, the 10 manufacturer would submit a proposed plan to us. In the 11 case of something that is not a dramatic change to the 12 engine vehicle configuration in general; say, for 13 instance, a filter that is simply added on as after 14 treatment with no other changes to the system, there are 15 alternatives that we would consider such as simply 16 removing that filter and testing it on a standard engine 17 in the laboratory. 18 For those strategies that are a little more -- I 19 don't want to really use the intrusive, but involve more 20 profound changes upstream; say, perhaps it includes 21 recalibration of the engine ECU, say, it includes 22 something like new fuel injectors, et cetera, they would 23 be required to probably test the entire vehicle. 24 We do have provisions in there that allow an 25 applicant to basically propose an alternative to what PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 38 1 we've set out. And we would evaluate all those -- 2 basically, the idea being that there is such a variety of 3 strategies that we are likely to see under this program, 4 that we do need that flexibility to make sure that 5 everyone is evaluated appropriately. 6 CHAIRPERSON LLOYD: So when you talk about the 7 manufacturer, you're talking about then the engine 8 manufacturer, the emission control device manufacturer. 9 But then you've got the operator. So -- carry on. 10 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: The 11 in-use compliance program that we are proposing today is 12 essentially a check on the manufacturer or provider of the 13 emission control strategy, not on the end user. 14 CHAIRPERSON LLOYD: Okay. 15 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: So 16 this would be specifically to make sure that the filters 17 that we are expecting to require in future regulations or 18 whatever strategies there are, that those are actually 19 working and that the provider of those technologies is 20 living up to his or her end of the bargain. These would 21 not be tests that would go after, say, the individual 22 trucker or farmer or whoever. It is really intended to 23 evaluate that the devices or the strategies that are out 24 there are performing as they were verified to perform. 25 CHAIRPERSON LLOYD: So if you have -- so you're PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 39 1 not looking at the actual application by an operator? 2 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: 3 Correct. 4 CHAIRPERSON LLOYD: Yeah, I'm not quite sure how 5 this would work. 6 DEPUTY EXECUTIVE OFFICER CACKETTE: I think the 7 supplier of the equipment is going to have to make an 8 arrangement to have vehicles tested. They could have them 9 in a fleet of their own, for example, or they could make 10 an arrangement with the person that they provided the 11 equipment to procure that truck for so many days. It's up 12 to them how they reimburse or arrange with the trucking 13 company how to get a truck out of service for a few days. 14 And then there are other alternatives that -- so 15 it's up to them. But this is an obligation they have when 16 they certify, to figure out how they're going to get some 17 engines back to do the testing. 18 CHAIRPERSON LLOYD: That clarified it. That's 19 exactly what -- thanks. The onus is on the equipment 20 thing, but they'd have to work with the operator. 21 And the last one I had was, when you talk about 22 change in the original proposal, then the manufacturer has 23 to submit some data assuring some of the potential of 24 increased pollutant, they have to submit it using 25 atmospheric modeling. Do we specify which model should be PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 40 1 used, where they should be used? 2 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: 3 Because that provision would not go into effect until 4 2006, what we basically require is that the model must be 5 approved by the executive officer. 6 CHAIRPERSON LLOYD: And that would be -- so if 7 these vehicles are operating, say, in L.A., San Francisco, 8 or the Bay Area, which model -- or the Central Valley, 9 which model then would be used? 10 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: I 11 think that the executive officer would have the 12 discretion, at that time, to determine if there would be 13 regional verification or not. 14 CHAIRPERSON LLOYD: And I understand. 15 Thank you. 16 Any questions? 17 DEPUTY EXECUTIVE OFFICER CACKETTE: And it also 18 would depend on what the pollutant is -- which pollutant 19 is being increased that they want to try to show modeling, 20 that it has no impact on air quality. 21 CHAIRPERSON LLOYD: Yeah, what I got from Scott 22 is that clearly we got time to work on this as time goes 23 along and takes a look at it. 24 Questions from my colleagues? 25 BOARD MEMBER BURKE: That's why you get the big PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 41 1 bucks. You understand it. I'm still confused here. 2 Let me ask some simple questions first, maybe I 3 can get -- now, are we talking about a hard filter or soft 4 filter here? Are we talking about kind of -- what kind of 5 filter are we -- can you hear me now? Because you 6 couldn't hear me before. 7 Are we talking about, you know, a hard filter or 8 a soft filter? You know, are we talking about one of 9 those big paper guys that you put in and it runs through 10 or are we talking about some kind of hard catalytic 11 filter? 12 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: In 13 general, what we've seen so far are the cordiorite 14 filters, basically the ceramic-based filters, typically 15 with some sort of catalytic action. 16 The possibilities, however, for strategies that 17 can be brought forth under this procedure are very many. 18 We're trying to be very open to ensure that the end user 19 gets the widest possible choice of how to comply with the 20 eventual regulations. 21 But right now it looks like the ceramic filters 22 are likely to predominate. 23 BOARD MEMBER BURKE: What's on these engines now? 24 I mean, this is what we're protecting, I understand. But 25 what's on them now? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 42 1 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: 2 Basically, right now most diesel engines do not have 3 filters. 4 BOARD MEMBER BURKE: My engines have filters, 5 but -- 6 RETROFIT ASSESSMENT SECTION MANAGER ROWLAND: 7 Okay. I'm sorry. They do not have particulate filters 8 for the exhaust treatment. 9 BOARD MEMBER BURKE: Okay. 10 DEPUTY EXECUTIVE OFFICER CACKETTE: The only 11 after treatment on diesels these days in the exhaust after 12 treatment is some engines have catalytic converters. And 13 that's a flow-through system. It doesn't -- 14 BOARD MEMBER BURKE: I have a water filter 15 system, which is really very interesting. I've been 16 trying for the last two or three years where I've been 17 running it through water in the exhaust system. I have a 18 very long throw on my exhaust system, so I run it at about 19 six feet through water -- salt water and then out. I've 20 been trying to find out if that really affects -- I know 21 it affects the smell and I know it affects the visual 22 emission. I'm not quite rich enough to do the test to 23 find out how it affects particulate matter. 24 DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah, I don't 25 think we've done any on diesel engines, but we have tested PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 43 1 jet skis, which use two-stroke engines, which produce a 2 fairly large amount of particulate. And their exhaust 3 runs through water. And our test facility had a big pool 4 of water that we ran -- 5 BOARD MEMBER BURKE: Yeah, I saw it turn black 6 like in two seconds. It was incredible. 7 DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah. And 8 also, you saw all the stuff come up into the container and 9 then sampled. And there was, you know, a large amount of 10 fine particulars that had gone through the water, but 11 still ended up in the air above it into a sampling system. 12 So we know it doesn't collect all of the or even a 13 substantial portion of the small -- very small particles. 14 It may be the bigger ones and it certainly may be some of 15 the organic materials either dissolve or, you know, played 16 out on the water surfaces of the walls, things like that. 17 But I don't think it -- if you looked at it for overall 18 efficiency, I doubt that it would -- it probably wouldn't 19 make Level 1, let's put it that way. 20 BOARD MEMBER BURKE: Right. I had a feeling of 21 that, especially after I saw them turn on that jet ski. 22 CHAIRPERSON LLOYD: Mr. Calhoun. 23 BOARD MEMBER CALHOUN: I guess I'd like to go 24 back to the question the Chairman asked a few moments ago 25 about in-use compliance testing. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 44 1 Are the potential applicants aware of your 2 expectations regarding in-use compliance testing? 3 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 4 HEBERT: Yes, they definitely are. 5 BOARD MEMBER CALHOUN: How many workshops? 6 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 7 HEBERT: Oh, three workshops and several mail-outs. And 8 we've met with MECA constantly and its members. And, of 9 course, all the people who have come and talked to us, 10 there have been quite a few over the last year and a half 11 now. 12 In-use compliance is a concern on their part 13 because it does require additional pulling -- I mean 14 additional testing. 15 BOARD MEMBER CALHOUN: And there is a potential 16 for taking the vehicle out of service and, whatever you 17 want to call it, in order to carry out these tests? 18 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 19 HEBERT: Oh, they're going to have to arrange to pull -- 20 like if it's -- you know, whatever engines or vehicles 21 they're having their technology performed on, they're 22 going to have to arrange to have those vehicles actually 23 brought in. We want actual applications. And, yes, that 24 would be the case unless it's in the case of a filter 25 where it could be actually pulled off and put another PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 45 1 engine to test. 2 BOARD MEMBER CALHOUN: Isn't that the same 3 process that the Feds currently require for heavy-duty 4 engines? 5 DEPUTY EXECUTIVE OFFICER CACKETTE: Well, right 6 now there is no in-use program for heavy-duty engines. So 7 they pull engines off the assembly line and test them, but 8 not -- but it is very equivalent to what we do on cars in 9 a way in that, you know, we procure cars to determine if 10 in-use they're complying or not. 11 And in that case, the government procures them, 12 we pay people to borrow their cars. In this case, the 13 device supplier is going to have to make an arrangement to 14 get these -- it's what, four to ten engines. It's not 15 like per fleet or anything. It's just for that technology 16 they just need to get the minimum number of engines and 17 test it. So, at best, it's going to be, you know, a few 18 engines affecting one -- possibly affecting one customer. 19 But it's not -- the customer is not mandated to do 20 anything. The mandate is on the supplier. So they're 21 just going to have to make a business arrangement of some 22 type to allow this to happen or keep some vehicles in a 23 fleet that they control. 24 BOARD MEMBER CALHOUN: And refresh my memory 25 please. At the present time, there is no requirement for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 46 1 any of these engines to be retrofitted; is that correct? 2 DEPUTY EXECUTIVE OFFICER CACKETTE: No, transit 3 buses are required to be retrofitted on a schedule that 4 the Board has already adopted by regulation. That's the 5 only category that's mandated at this point. 6 We have money that is being spent to retrofit 7 school buses. So there's an incentive program that pays 8 100 percent of that. And that's what's being implemented 9 right now, and it requires -- to use the money requires 10 verified systems, so we've been using an interim version 11 of this regulation. 12 And then we have several mandatory retrofit 13 regulations in development which will be brought to the 14 Board -- I think the first one will be at the end of the 15 year, dealing with refuse trucks. So we have a vision 16 that there will be more in the future. But right now it's 17 only the transit buses that are mandated. 18 BOARD MEMBER CALHOUN: The next question I have 19 pertains to the durability of the system. Now, I know the 20 Board has had a lot of experience in retrofitting in the 21 past. And I also know it's been good and bad. 22 I wonder -- at least I didn't discern in 23 listening to the staff presentation or reading in the 24 report that there is any process for the Board to 25 determine an earlier warning system of things out in the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 47 1 field. And -- unless you read it in the newspaper. 2 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 3 HEBERT: Well, I think the in-use compliance program, the 4 first phase of testing is immediately after the first year 5 or within three months of the first maintenance. In the 6 case of a filter -- I mean, that would help determine if 7 there is failures there. 8 BOARD MEMBER CALHOUN: Well, I guess what I'm 9 thinking of is some anticipated event that may happen, you 10 know. And that's possible. You may approve a system and 11 suddenly there's a hiccup and you may not even know about 12 it. 13 DEPUTY EXECUTIVE OFFICER CACKETTE: Well, in the 14 15-day changes we've added one additional requirement that 15 may partialy address that, which is manufacturers have 16 to -- they have to offer a warranty, and so we're 17 requiring them to look at their warranty claims, that if 18 it gets above four percent, then they have to conduct 19 testing right away. And that program is analogous to what 20 we do on light-duty vehicles, where the same requirement, 21 is that the manufacturers must look at their warranty 22 claims. If they get too high, they have to -- in that 23 case have to -- should we recall the vehicles. So that is 24 an early warning at, quote, four percent. 25 Maybe from another viewpoint is at least in the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 48 1 early years of these technologies, almost all of them are 2 in some kind of a demonstration program already, and so 3 we're looking at vehicles with 50,000, 100,000 miles on 4 them in the experience at the same time that these systems 5 are going through the verification. So, you know, we have 6 more than just one engine that's run a long distance. 7 Some of the technologies are on hundreds of 8 engines operating around the world. And we are -- you 9 know, the International Diesel Advisory Committee is being 10 used as a way of trying to keep our finger on the 11 experience that's out there around the world with these 12 filters, much of which is more advanced in Europe than it 13 is here. So we do have some early warning systems 14 available to us from that standpoint as well. 15 BOARD MEMBER CALHOUN: Well, I think that's 16 something that you really have to watch, because the 17 potential is there for the systems to start failing and 18 you don't even know anything about it. And the next thing 19 you do is you read about in Gary Vukovich's column in the 20 L.A. Times or some other newspaper. 21 DEPUTY EXECUTIVE OFFICER CACKETTE: We are 22 intimately aware of that potential. And it's, you know, 23 probably why you lose a little sleep at night, because the 24 applications are so varied and in some -- and in this case 25 the end users may have a variety of different opinions PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 49 1 about using these technologies, and they have to be 2 involved. They require maintenance. They have to be 3 installed properly. And so to some extent there will be 4 people who are -- who may be using these that are less 5 enthusiastic about solving problems that come up, and 6 that's when you hear about it in the L.A. Times. 7 BOARD MEMBER CALHOUN: You mentioned the 8 four-percent warranty. I know how the warranty system 9 works now. And the auto manufacturers have to make 10 periodic reports. I think on their -- this proposal it's 11 after one year, isn't it? 12 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 13 HEBERT: The in-use compliance part, you're talking about? 14 BOARD MEMBER CALHOUN: No, I'm not talking about 15 in use. I'm talking about the warranty report that's 16 required. 17 BOARD MEMBER BURKE: This isn't a mileage figure? 18 I thought it was a mileage figure. 19 DEPUTY EXECUTIVE OFFICER CACKETTE: We're 20 checking that. But I think when the warranty claims get 21 to that level, they have to report. The other in-use -- 22 BOARD MEMBER CALHOUN: That four percent, you 23 mean? 24 DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah. 25 The other in-use testing requirement is triggered PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 50 1 off of calendar years. And if there's no evidence of a 2 problem, they still have to do testing in one year. 3 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 4 HEBERT: It's February 1st of each year. 5 BOARD MEMBER BURKE: So there's no mileage 6 requirement in that at all? 7 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 8 HEBERT: February 1st of each year warranty. 9 BOARD MEMBER BURKE: I'm sorry. Is there a 10 mileage requirement in there at all just on February 1st 11 of each year? 12 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 13 HEBERT: Just February 1st right now. 14 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: The 15 other thing I -- this is Bob Cross of the staff also. 16 CHAIRPERSON LLOYD: Hold on. I don't think Dr. 17 Burke's question was answered. 18 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: 19 Okay. I was going to -- but go ahead. 20 DEPUTY EXECUTIVE OFFICER CACKETTE: It appears 21 that when you're monitoring warranty claims when we've 22 written a regulation is you sum those up and then on 23 February 1 you report them. The other requirement is for 24 in-use testing. And -- 25 BOARD MEMBER BURKE: What is the sum number -- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 51 1 DEPUTY EXECUTIVE OFFICER CACKETTE: When -- 2 you're looking at your sales versus the number of claims 3 that come in and you keep looking at it and if it gets 4 over four percent, that triggers a requirement to do more 5 testing of in-use vehicles. But the way it's written 6 right now, you only have to report that, quote, "failure" 7 on February 1 of each year. The other provision is they 8 have to do in-use testing regardless of warranty claims 9 at -- what is it, one year? 10 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Yes, 11 one year or -- 12 DEPUTY EXECUTIVE OFFICER CACKETTE: -- or within 13 three months of the scheduled maintenance for that 14 product. And that's to figure out whether it -- overall 15 whether it's performing well in use. 16 BOARD MEMBER BURKE: Is there ever a situation 17 where the work order we would require would exceed the 18 value of the truck? 19 DEPUTY EXECUTIVE OFFICER CACKETTE: Where the -- 20 BOARD MEMBER BURKE: -- work we would require 21 would exceed the value of the truck. 22 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: 23 There's nothing -- there is nothing that is proposed that 24 would do that. 25 BOARD MEMBER BURKE: What I was thinking about is PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 52 1 what happens if you pour -- not pour -- the independent 2 operators who have a truck recalled in, has to do warranty 3 work required by us but exceeds the value of the truck so 4 it puts them out of business? 5 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: 6 Well, can I back up one step and then move forward two. 7 In response to the monitoring of how they're 8 doing in the field, we are, in fact, already sending staff 9 out to inspect the buses and trucks that have these 10 prototype systems on them, often. I mean they're down 11 there talking to the mechanics at the various fleets and 12 seeing whether or not they're smoking and doing all the 13 stuff that we should do to make sure that they -- that if 14 something -- if there is a hiccup, we'll catch it early 15 enough so it doesn't show up in the newspaper first, if we 16 can possibly do that. 17 The question of requiring more work than the 18 value of the truck, I think we're not there yet in terms 19 of -- you know, the staff said we're working on proposing 20 mandatory retrofit requirements. Those proposals are 21 still in the workshop phase and they're -- we're getting 22 an awful lot of comments on specific issues that you 23 mentioned; i.e., what is the value of the retrofit versus 24 the value of the truck? What are the maintenance 25 requirements? Is it appropriate to ask for retrofitting PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 53 1 of a truck that's going to go out of service? So I think 2 that we'll -- 3 BOARD MEMBER BURKE: You know, quite frankly, I'm 4 not opposed to the program. But what I think we ought to 5 think about -- you know, we're environmental justice here. 6 Most of those guys that are operating those trucks are 7 minority people. Maybe we should figure out some kind of 8 way that we can merge this into our environmental justice 9 program, so we could have a little pot of money so that, 10 you know, they can -- we don't want them out there 11 polluting. So maybe we could have some kind of loan 12 program, grant program, something like that, so that -- 13 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Yes, 14 the first fleet that we're -- we keep -- 15 BOARD MEMBER BURKE: -- they keep going and we 16 keep going, you know, so we're not stopped and they're not 17 stopped. 18 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Our 19 first fleet is trash trucks. And so the -- and the band 20 width is huge on that. They're, you know, like one -- 21 sort of one-truck companies up to very large operators. 22 And some of them are exactly what you're describing. So 23 we're bumping into the problem that you've outlined. 24 DEPUTY EXECUTIVE OFFICER CACKETTE: But that 25 issue will come to the Board in -- scheduled I think for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 54 1 December now or late in the year. This is just the 2 verification procedure that would -- you have to pass 3 through this hoop before you can sell a product. And the 4 only issue on the warranty here is -- obviously, if you've 5 got this on your engine, it's under warranty, then you get 6 it replaced for free. Once it's outside the warranty 7 period, then comes the issue if it fails, what's the 8 remedy there? And that will be addressed in the 9 regulation that affects that fleet, not in the 10 verification. 11 BOARD MEMBER BURKE: I'm very proud of the work 12 that this Board, Mr. Kenny and the staff has done with EJ 13 in the past year or two. And, you know, I think that this 14 is a workable situation and that -- you know, it's a real 15 problem in the real world. It's not -- you know, we don't 16 face it here. Nobody in this room has a truck that's, you 17 know, worth that, but out in the real world I think that's 18 a real problem. But I think that this Board has become 19 sensitized that needs to -- we'll address it. You know, 20 I'm not worried about that. 21 CHAIRPERSON LLOYD: Are there questions or 22 comments from the Board members? 23 BOARD MEMBER CALHOUN: You know, I guess I'm just 24 going to make one last comment. 25 I think you may want to rethink the reporting on PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 55 1 the warranty, because if the warranty rate is high, it 2 doesn't really matter whether it's a year or -- maybe I 3 shouldn't say it doesn't matter. It would matter to me. 4 If the warranty rate is higher earlier in the game, that 5 means there's really a problem. But I think that maybe 6 you would want to know about it. 7 EXECUTIVE OFFICER KENNY: I think you're probably 8 right. I mean, essentially, if, in fact, there is a 9 warranty increase that's in excess of four percent and it 10 happens actually rather sooner as opposed to by February 11 1st, we would like to know about it. And so I think your 12 suggestion probably is a good one and may be -- one of 13 the modifications the Board may want to consider is 14 looking for the February 1st, or sooner, if, in fact, we 15 hit that four-percent number, just so, in fact, we're not 16 waiting for it. 17 CHAIRPERSON LLOYD: Thank you. 18 I would like to also ask the ombudsman, at this 19 time if you would, describe the public participation 20 process that occurred while this item was being developed, 21 and share any other concerns or observations you may have 22 with us at this time. 23 OMBUDSMAN TSCHOGL: I'd be glad to. 24 Chairman Lloyd and Members of the Board, the 25 proposed procedures were developed with help from the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 56 1 Manufacturers of Emission Controls Association, The Engine 2 Manufacturers Association, local school districts, U.S. 3 EPA, European manufacturers, school districts, transit bus 4 agencies, waste haulers, and end users. 5 The activities for this Regulation began in the 6 On-Road Heavy-Duty Diesel Section in July 2000. On July 7 28th the first public notification to draft this 8 regulation was mailed to more than 1,200 companies and 9 individuals. 10 Subsequently the Regulation moved from the 11 On-Road Heavy-Duty Diesel Section to the newly formed 12 Retrofit Assessment Section. 13 In May 2001, the first workshop was held in El 14 Monte. A second workshop was held in September of that 15 year in downtown Los Angeles. And in February of this 16 year the third workshop was held in El Monte. 17 On average, 60 people attended each workshop. In 18 addition to workshops, staff had several teleconferences 19 and meetings with industry representatives. The notice 20 for the public hearing was mailed and posted on ARB's web 21 site on March 29th, 2002, and the staff report was mailed 22 April 2nd. 23 Because of the complexity of this regulation, it 24 has taken staff nearly two years to develop. During this 25 time, as I said, many stakeholders actively participated PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 57 1 in its development. 2 Thank you. 3 CHAIRPERSON LLOYD: Thank you. 4 So with that, I would like to call on the first 5 witness who is signed up to speak in the item. And if you 6 would please come forward. 7 The first is Bruce Bertelsen, then Don Friest, 8 then Stephanie Williams. 9 MR. BERTELSEN: Good morning. 10 CHAIRPERSON LLOYD: Good morning. 11 MR. BERTELSEN: That concludes my testimony. 12 (Laughter.) 13 MR. BERTELSEN: Good morning. For the record, my 14 name is Bruce Bertelsen, and I'm the Executive Director of 15 the Manufacturers of Emission Controls Association. 16 With me today is Dale McKinnon, MECA's Deputy 17 Director, and really led MECA's efforts in working with 18 the ARB staff and the other stakeholders in fashioning an 19 effective verification program. And I do want to point 20 out that Dale McKinnon is not related to Matt McKinnon, 21 although I think they look an awful lot alike. 22 We're very pleased to be here today to support 23 the proposed regulations. We think the verification 24 process is fair, it's flexible, it's a balanced approach, 25 and it is indeed challenging. It is indeed a challenging PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 58 1 verification process. We think that's appropriate. We 2 think it's going to be an effective program that will 3 serve the objectives of the Diesel Risk Reduction Program 4 well. 5 I want to take this opportunity particularly to 6 thank the staff for its willingness to work with MECA, 7 MECA members, any other stakeholders; and for their truly 8 extraordinary efforts to develop this effective program. 9 By way of background very briefly, I think as the 10 Board members and the staff are well aware, MECA is an 11 association of leading manufacturers of emission control 12 technology from mobile sources throughout the world. 13 Our companies have over thirty years of 14 experience and a proven track record. A number of our 15 companies are actively involved in the diesel retrofit 16 area. These include large companies, small companies, a 17 wide variety of different technologies. 18 We think that and really our philosophy from the 19 very beginning was that an effective program should 20 achieve two very important objectives. 21 First, it has to be rigorous enough to ensure 22 that the products are effective and durable, that they 23 achieve the objectives for which they were designed. 24 And, secondly, the program shouldn't be so overly 25 burdensome that it would discourage manufacturers to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 59 1 certify effective products that could provide significant 2 emission reductions. 3 An we really think that the end result of the 4 considerable effort on the part of the stakeholders and 5 the ARB staff is a program that accomplishes quite well 6 both of those objectives. 7 We want to commend the Board and the staff for 8 its efforts in the diesel emission control area. We want 9 to pledge our continuing willingness to support the Board 10 and the staff. And we look forward to doing our part to 11 move forward with the Diesel Risk Reduction Program. 12 I'd be happy to answer any questions you might 13 have. 14 CHAIRPERSON LLOYD: Thank you very much. I know 15 you're in favor of the regulations. Is this a unanimous 16 vote of your members? 17 MR. BERTELSEN: We have involved our members at 18 virtually every stage of the process, and we have not 19 heard a dissenting view on this subject. All of our 20 companies have been involved. 21 CHAIRPERSON LLOYD: Thank you. 22 Comments or questions from the Board? 23 Thank you very much, Bruce. We appreciate your 24 coming out here. 25 MR. BERTELSEN: Thank you very much. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 60 1 CHAIRPERSON LLOYD: We appreciate your support. 2 Dawn Friest, Stephanie Williams and Paul Beck. 3 MS. FRIEST: Good morning. My name is Dawn 4 Friest and I'm here today on behalf of the Engine 5 Manufacturers Association. 6 Among EMA's members are the major manufacturers 7 of diesel-fueled engines for on-road, off-road, and 8 stationary applications. 9 As I believe many of you are aware, EMA has been 10 a strong proponent of retrofit programs as they advance 11 our shared goal to improve air quality. Principally, we 12 think those programs can be successful on a voluntary 13 incentivized basis. The Carl Moyer program is an 14 excellent example of such success. 15 However, in order for retrofit programs to be 16 successful in a large scale, retrofit technologies that 17 are proven, durable, and cost effective must be available 18 in the marketplace. 19 And the key for helping to assure that such 20 technologies exist and are available for use is a 21 workable, cost-effective verification procedure. 22 EMA and its members first discussed the need for 23 such a procedure with Dr. Lloyd and Mr. Kenny almost two 24 years ago. Since that time, ARB has created the 25 International Diesel Retrofit Advisory Committee, IDRAC, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 61 1 on which we serve, has worked with various stakeholders to 2 develop a workable verification protocol, and has worked 3 to try to minimize any potential differences between ARB's 4 protocol and that being developed by EPA. Harmonization 5 is just as critical in the retrofit arena as it is in the 6 regulation of new engines. 7 In developing the proposal before you today the 8 staff has worked hard to balance the interests between 9 procedures that guaranty foolproofness and those that 10 foster the marketability of what almost by definition are 11 new and often untried technologies. We have provided 12 extensive input to the staff to help them strike the 13 appropriate balance. 14 As you could imagine, it is in our best interests 15 to prevent inferior retrofit technologies from being 16 integrated with the engines that our members produce. And 17 it is also in our best interests to assure that the owner 18 of the engine being retrofitted has a choice of vendors 19 and as much product availability as possible. 20 We also want to avoid having a regulatory program 21 that unnecessarily interferes with commercial issues best 22 addressed by the marketplace. 23 Many of the issues that we have discussed with 24 the staff to assure the proper balance between product 25 availability and foolproofness are included in the various PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 62 1 issues that are a part of the 15-day notice 2 recommendations. Our intent is to review those 3 recommendations closely and to continue to work with the 4 staff to ensure the prompt adoption of verification 5 protocols that are sound, cost effective and balanced. In 6 doing so, we hope and ask that you give the staff 7 direction to continue to work with us and other 8 stakeholders to strike the appropriate balance to find a 9 happy medium. 10 Engine manufacturers have invested an enormous 11 effort in producing new engines that are extraordinarily 12 low emitting and will soon be producing even cleaner 13 products. Much of what has been learned has potential 14 application to existing engine designs. 15 As you know, the engines that EMA members produce 16 typically are used in long-lived capital goods and are 17 designed to be rebuilt. The more that we work together to 18 implement cost-effective voluntary programs that encourage 19 owners to turn over their fleets faster and to upgrade 20 their fleets to lower emitting technologies through 21 retrofits, repowers and the like, the sooner that we will 22 reap the benefits of the new emission control technologies 23 that we have developed. 24 We look forward to continuing to work with you 25 and the staff on those efforts. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 63 1 And thank you for your time today. If you have 2 any questions, I would be pleased to answer them. 3 CHAIRPERSON LLOYD: Thank you very much. 4 Any questions from staff? 5 BOARD MEMBER BURKE: Yeah, I have a question. 6 CHAIRPERSON LLOYD: Dr. Burke. 7 BOARD MEMBER BURKE: You know, this is such a 8 dramatic turnaround from the testimony of your 9 organization at the South Coast Air Quality Management 10 District two years ago when we were doing the 1100 series 11 and talking -- what has made your organization, you know, 12 become believers in this technology in that period of 13 time? You were just adamant that, you know, you didn't 14 want to see anything about this, you didn't want to hear 15 about it, you know; but let the engine manufacturers 16 develop their own technology. 17 Was it a bolt of lighting? Did Jesus appear? 18 What happened? 19 MS. FRIEST: Well, I can say that, you know, I 20 wasn't involved in the process at that time, so I can't -- 21 I can tell you that there's -- 22 BOARD MEMBER BURKE: That's what I always say, 23 too. 24 (Laughter.) 25 MS. FRIEST: I can say that there's been a -- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 64 1 there's a great appreciation for the considerable effort 2 that's been invested by the staff to listen to our 3 concerns. We've been present at the workshops. We've had 4 many individual calls and conferences and submitted 5 detailed written comments and tried to find a way to 6 balance the interests that we see that are -- that need to 7 be balanced while still getting a program on the market. 8 BOARD MEMBER BURKE: I noticed in the second to 9 the last sentence of your presentation, the more we work 10 together to implement cost-effective voluntary programs 11 that encourage our owners to turn over their fleets faster 12 and upgrade their fleets to lower-emitting technologies 13 through retrofits and repowers or the like, the sooner 14 we'll reap the benefits. 15 I just wish you had been there a couple years 16 ago. And you might check with your organization to find 17 out, you know, what happened, you know, when you go back, 18 so that when the next person who is sitting in this chair 19 after me asks you that question, you'll be able to answer 20 it. Because we believed in this for a long time, and 21 we're just glad to see you come along finally. 22 MS. FRIEST: Thank you. 23 CHAIRPERSON LLOYD: Just one comment here. I 24 notice that you and Jed are asking the Board to encourage 25 the staff to develop the -- get to this happy medium. How PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 65 1 will we know when we're there? 2 MS. FRIEST: I think that we're going to have an 3 opportunity to look at the 15-day notice changes. And 4 we've had some considerable discussion about some of those 5 changes. And that once we have taken a close look at 6 those changes, you know, if the changes that we've 7 discussed appear in those notices, that -- you know, that 8 will go a long way to at least making our members feel 9 comfortable with the process. 10 CHAIRPERSON LLOYD: Thank you. And give our 11 regards to Jed. And I think Dr. Burke's comment is 12 clearly -- I don't know. Maybe the fact that Jed isn't 13 here maybe -- 14 MS. FRIEST: Jed is well aware of the words 15 printed on this paper, believe me, as are all our members. 16 This goes through a very long review process. 17 CHAIRPERSON LLOYD: Well, we really appreciate 18 you working with us, and we appreciate you coming. And so 19 for whatever reason, I think it's nice to be working 20 together here closely on that. 21 MS. FRIEST: And Jed wanted me to express his 22 appreciation for the staff's work and the Board's time. 23 CHAIRPERSON LLOYD: Thank you very much. 24 Change of pace. 25 Stephanie Williams and then Paul Beck and then PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 66 1 Oreste Bevilacqua. 2 MS. WILLIAMS: Yeah, tell Jed I said hi, too. 3 I am Stephanie Williams. I'm representing the 4 California Trucking Association. We're opposed to the 5 verification based on the warranty issues. 6 I want to go over a few things with you that I 7 think will bring some light to this. And let's start with 8 the emission factors for PM for trucks. 9 A 1987 truck has one-gram brake-horsepower-hour 10 PM. The cost of the market value of that vehicle right 11 now is $2,500. 12 The '91 standard would be .6, I believe -- I 13 think .6. Bear with me on these. I don't have them 14 memorized. The cost of a '91 vehicle fair market value 15 today is $5,000. 16 A '94 engine, which is the latest best available 17 technology for PM control sold on the certification, is 18 $10,000 for a heavy-duty truck. 19 And a '98 vehicle today sells for between $35,000 20 and $45,000, depending on if it's a sleeper unit or not. 21 Okay. So, I know that my car is in the top level 22 of -- my car would cost the same as a 1998 truck. My 23 children's cars cost the same as the '91 trucks. So we're 24 dealing with an economic situation that is the same as the 25 end user. And we are the end user. We're the truckers. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 67 1 And this is a consumer-protection issue, and I believe 2 this proposal does not protect the consumer. 3 Let's start with petroleum tank trucks. A 4 petroleum tank truck -- we did a survey of our members. 5 Surveys are still coming in because we're looking for 6 economic data. But the average petroleum tank truck goes 7 between 120,000 miles a year and 390,000 miles a year; 8 390,000 miles a year is the 90th percentile on our data. 9 So let's just take the 90th percentile and work from that. 10 That would mean in months the warranty on a 11 particulate trap for, let's say -- let's put a particulate 12 trap on a '94 petroleum tank truck. Reasonable. It would 13 cost for 350, 450 power, $8,500; if you put the back 14 pressure device to gauge if there's a problem, let's say 15 $10,000. So the trap is the equivalent to the price of 16 the entire truck. And we're asking to have a warranty on 17 the device, which is four, five, six months. That's 18 unacceptable consumer protection. You wouldn't do that to 19 the end user of a car. You wouldn't tell Stephanie 20 Williams that she has to put a catalyst on her car that 21 costs the same as her car, because it would be 22 inappropriate cost effectivewise. 23 CHAIRPERSON LLOYD: What's the warranty on the 24 engine? 25 MS. WILLIAMS: The warranty we -- warranties that PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 68 1 are sold, the market warranty is 500,000 miles. We get 2 million mile warranties. You pay extra for a million mile 3 warranty. So -- and I believe -- when we were working on 4 the federal implementation plan there were 290,000 miles 5 emission control warranties and 435,000 mile emission 6 control warranties, depending on the weight of the 7 vehicle. 8 And those are required by federal EPA, that the 9 engine manufacturers have to make sure that their emission 10 controls on these trucks last for that period of time. 11 So why would we bring in this new thing -- and 12 we're talking about retrofitting brand new vehicles. Why 13 would we bring in a warranty that has, you know, six 14 months. 15 And then, on top of that, if you have a brand new 16 vehicle that's under warranty, all right, and you put on a 17 particulate trap -- and let's say accidentally you are 18 using your vehicle in a different way, it used to be stop 19 and go, so they put the particulate trap on, but your 20 driver decides he's going to go across town on the 21 freeway, maybe he wants to go to San Diego to pick 22 something up that's a different type of operation. 23 So the particulate trap has problems, back 24 pressure, catastrophic engine failure, who's responsible? 25 The particulate trap manufacturer will point to the engine PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 69 1 manufacturer; the engine manufacturer will point to the 2 particulate. The end user is stuck with an invalid 3 warranty. So you've taken away the warranty that he 4 purchased, the 500,000 mile warranty, and left him with 5 the bag. This is unfair consumer protection. It needs to 6 go back to the drawing board and look in our favor. 7 It's nice that the engine manufacturers are 8 supporting giving us all the liability and it's nice that 9 the trap manufacturers are supporting giving us the 10 liability. But I'm asking you, as the Air Resources 11 Board, to protect the end user. We are not guinea pigs. 12 We are product purchasers, just like the public, just like 13 cars, and we need your protection. And this rule, as 14 written, does not protect us. And it will end up in the 15 L.A. Times. I'll call them myself. I mean, this isn't a 16 fair thing. 17 It doesn't work to put the liability, the 18 responsibility on the end user, because the end user has 19 no way to protect themselves against something like this. 20 So what you need to do, in my opinion, and the position of 21 the California Trucking Association, is to take the 22 warranty to 500,000 miles. And we would not have a 23 problem with it. And make sure that the liability and 24 responsibility in any type of catastrophic failure goes 25 where it belongs, with the engine manufacturer or the trap PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 70 1 manufacturer. And it doesn't have to go to court to 2 decide whose fault it was when the engine does have 3 problems, that we're not stuck with the bag and then have 4 to pay legal fees on top of that to determine whether it 5 was the engine manufacturer's problem or the trap 6 manufacturer's problem. Clearly, state the liability. 7 There is a -- on page 57, section 4.3, it says -- 8 I think that based on the staff report, this would work to 9 have a 500,000 mile warranty. 10 "Engine manufacturers have expressed 11 concerns that the proposed warranty 12 period would be inappropriate. However, 13 manufacturers of diesel emission control 14 systems are confident their systems can 15 meet the proposed warranty period. 16 Additionally, users have requested 17 longer periods to match expected useful 18 lives. Staff believes the proposed 19 periods are appropriate. For strategies 20 employed in in-use diesel engine, a 21 shorter period would not provide 22 sufficient consumer protection." 23 Well, I think four or five months is not 24 sufficient consumer protection, you know. 500,000 miles, 25 possibly one or two years, would be sufficient consumer PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 71 1 protection. 2 "Successful implementation of in-use strategies 3 will depend on the user acceptance." You're right, we 4 don't accept this. We don't feel protected. 5 So we would ask that you take this rule back or 6 extend the warranty period to something that is similar to 7 cars and similar to the cost of the retrofit devise based 8 on the value of the vehicle. And neither of these are 9 represented in the proposal, and they should be. 10 This is the first step of regulating and 11 requiring controls on diesel vehicles. If this is not 12 tied with the waste rule and the petroleum carriers rule, 13 both rules will fail. This could be a catastrophic 14 disaster. 15 And it happened once already. Need I remind you 16 of Jerry Brown's experience with catalytic converters. 17 And they were a lot less expensive than what we're talking 18 about here. 19 CHAIRPERSON LLOYD: They weren't catalytic 20 converters. 21 MS. WILLIAMS: Well, NOx catalysts or whatever 22 they were. Retrofit devices -- I think retrofit device is 23 the proper word. But the warranty issue is inappropriate. 24 And talking about environmental justice, this 25 should be in the environmental justice arena when you look PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 72 1 at the value of these vehicles and the people that are 2 buying them. They need to be protected by the Air 3 Resources Board. 4 CHAIRPERSON LLOYD: Well, remember, Stephanie, 5 the goal here is to reduce exposures to diesel 6 particulates. That's the thrust. Clearly, you make some 7 suggestions that we're not doing well enough in certain 8 areas. But I think we're both on the same page of trying 9 to reduce public exposure. 10 MS. WILLIAMS: This doesn't have anything to do 11 with reducing public exposure. Your -- the warranty, the 12 very -- the first open door doesn't protect the consumer. 13 I mean there's no public exposure reductions if a trap 14 gets on the last four months and comes off. I mean, it's 15 actually the opposite, because money that could have gone 16 into new vehicles will be going into traps. You're going 17 the opposite way. 18 CHAIRPERSON LLOYD: Well, that's a matter of 19 opinion. 20 MS. WILLIAMS: The warranty -- it is. It's the 21 opinion of the end user that you're going the opposite 22 direction. These vehicles are inexpensive. It's easy to 23 get into a truck and make $20,000 a year. It's better 24 than flipping a burger. So -- 25 CHAIRPERSON LLOYD: I think, again, we've got to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 73 1 separate here this, which is a procedure for the 2 evaluation devices, which is not a rule compared to the 3 rules. I know they're tied, but on the other hand they 4 are separate. 5 MS. WILLIAMS: I don't think it's fair to 6 separate them. I think that you miss the boat when you 7 separate them, because you're passing this so then you can 8 pass the rules. They're tied together. 9 Actually, it would make more sense to put this 10 over until you bring up the first rule, and look at it 11 with the waste rule, look at it with the first rule. It 12 would make more sense to do that so the Board can get an 13 adequate idea of what they're really doing. 14 Right now, oh, this is voluntary? This is the 15 warranty. It doesn't hurt anybody. You're not requiring 16 somebody to go out and spend $9,500 on a particulate trap 17 that costs the same as the value of the vehicle. And 18 you're not requiring -- you're not requiring the people 19 who sell the trap to be soluble enough to do a recall in 20 case it doesn't work. You're worried about -- everything 21 is based on the people who make the traps and the engine 22 manufacturers. What if they don't work and you have to do 23 a recall? What happens? Are you going to pay the trucker 24 back for the $9,500 device? If the company can't afford 25 to go through the process of certification, how could they PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 74 1 afford a recall? We are not protected in any part of this 2 program. This is completely biased towards engine 3 manufacturers and trap manufacturers. It's anti-consumer. 4 And that would conclude my comments. Thank you. 5 Any questions? 6 CHAIRPERSON LLOYD: Staff, any response to that? 7 EXECUTIVE OFFICER KENNY: Actually, if I could 8 start. 9 I think this issue breaks down into a couple of 10 sub-issues. And the first one is essentially that this is 11 a retrofit procedure. And what we are talking about is 12 trying to develop a procedure that could be utilized to 13 determine whether or not the equipment that's going to be 14 provided is going to be durable, is going to do the job 15 that we want it to do. 16 With regard to the cost effectiveness, I think 17 that is a secondary issue. And we have not spent a lot of 18 time talking about the cost effectiveness of this 19 particular procedure for the simple reason that there 20 really are no emission reductions specifically associated 21 with the procedure. The emission reductions will come 22 into play when we do do the further rules, the ones that 23 Stephanie was referring to. If we do the waste trucks, if 24 we do the cargo tank haulers, things like that, then we'll 25 be looking at cost effectiveness and making determinations PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 75 1 as to whether or not the particular equipment is cost 2 effective in this particular application. 3 And those are the kinds of issues that will have 4 to be considered by the staff and by the Board when it 5 makes its ultimate determination as to whether to go that 6 direction. 7 I think also what we were talking about here is a 8 150,000 mile warranty with regard to these particular 9 types of emission control devices. And what we are trying 10 to do is really kind of put together a procedure that 11 recognizes that we are at the beginning. And as a result 12 of being at the beginning, we want to make sure that there 13 is durability, we want to make sure that there is a level 14 of consumer protection. But at the same time we can't go 15 to the point where we have an absolute guaranty that we're 16 going to be absolutely certain this is going to work right 17 now. 18 We think, and we have very high confidence, that, 19 in fact, this is going to work. At the same time, we are 20 in the beginning stages of this, and we want to 21 essentially go out there, put these things on there. 22 We're working with demonstration projects right now, and 23 then we're moving forward slowly with regard to individual 24 fleets. We started with transit buses. And we're moving 25 forward through the individual discrete fleets, which give PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 76 1 us the opportunity to make sure that, in fact, we are 2 going to be successful in the long run when we get to the 3 larger and larger fleets. 4 CHAIRPERSON LLOYD: Well, Stephanie's comment 5 that supposing they get out there and do fail, then -- 6 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Dr. 7 Lloyd, do you want us to still respond to your earlier 8 question about the warranties that are actually in the 9 field? We started to and we didn't -- 10 CHAIRPERSON LLOYD: Yeah, fine. 11 EXECUTIVE OFFICER KENNY: Actually, before we go 12 there, one other comment, and I think you have raised it, 13 Dr. Lloyd, which is that if, in fact, there is a failure 14 in the field, I mean what we do is we do not allow the 15 manufacturers of this equipment to essentially defer their 16 obligation to the users. I mean, what is happening here 17 is if there's a failure in the field, it's not a matter of 18 pointing fingers. The Regulation does provide that the 19 manufacturers of the equipment are responsible for this. 20 MS. WILLIAMS: What if there's a back pressure 21 issue and there's a catastrophic engine failure? Is it -- 22 BOARD MEMBER BURKE: I want to hear the staff 23 respond to this. 24 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 25 HEBERT: Okay. Just a little summary of what we have now, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 77 1 that the new engine emission control warranties are five 2 years, 100,000 miles or 3,000 hours. 3 Our proposal is five years, 150,000 miles, and 4 then various hours depending on the, you know, what -- 5 off-road versus portable versus stationary -- emergency 6 generators. 7 My understanding and talking to EMA and looking 8 at their web site, the 500,000-mile warranties are usually 9 purchased in addition to basic warranties. And Dawn 10 Friest is here to correct me if that's inaccurate. But 11 basic vehicle warranties range from one to two years to 12 100,000 to 250,000 miles, and then you have engine 13 warranties. 14 I can give some examples, like a Class 8 Mack 15 truck basic warranty is 12 months, 100,000 miles; engine 16 warranty's 36 months, 300,000 miles. You can purchase an 17 extended warranty for 60 months, 500,000 miles. 18 The emission control system manufacturers have 19 the option, I think, of selling extended warranties on 20 their products as a commercialization type issue, similar 21 to what the engine manufacturers do. 22 We did have some -- we initially started with 23 100,000 miles consistent with the new engine emission 24 control warranties. But after, you know, CTA being one of 25 the commenters that they wanted additional warranty PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 78 1 coverage, we basically upped it to 150,000 miles to give 2 it a little bit of extra cushion there. 3 The other thing is that a lot of these 4 technologies in cases like filters, if they're going to 5 fail, they fail almost immediately within the warranty 6 periods. If there's issues with them, they typically will 7 fail immediately. And probably Bruce Bertelsen can, you 8 know, testify to that fact. 9 So based on what we've seen in the demonstrations 10 and the field and what we've done, like I said if they 11 fail, they usually fail immediately. 12 And I can also tell you that MECA members have 13 repeatedly stated that they're not in the business of 14 losing money. And we'll -- in the implementation rules, 15 the way they're going to be written is that we're 16 requiring them to be put on. They're going to have to 17 have a high level of confidence, as well as us, that it 18 will work. And I don't think they will go and put 19 something on an engine that's going to fail; because if it 20 starts failing, they're just going to lose a lot of money 21 in market value themselves. 22 BOARD MEMBER BURKE: So with all that being said, 23 you're still putting the responsibility on the end user, 24 and it's always the little guy, you know. They're not in 25 the business of losing money, but the little guy always PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 79 1 takes it in the pipe because he doesn't have any choice. 2 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 3 HEBERT: No, with the warranty -- the warranty 4 statements -- I'm sorry. Go ahead. 5 BOARD MEMBER BURKE: If, in fact -- see, the 6 reason I always hate Stephanie Williams to testify -- 7 MS. WILLIAMS: You hate me? 8 BOARD MEMBER BURKE: No, I hate to hear you 9 testify. I don't hate you as a person. I like you as a 10 person. I think you're great. But my grandfather, who I 11 always thought was a great mechanic, I know he's spinning 12 in his grave when I listen to a woman who knows more about 13 cars and trucks than I do, you know. 14 And then the other thing that bothers me is she 15 usually is defending people that I would like to defend 16 but she usually does it more articulately than I can. 17 In this particular case, I'm really very 18 concerned about having those truck drivers on the end of 19 100,000 mile warranty -- or 150,000 -- I'm sorry, 150,000, 20 because it puts them out there. I mean, now, if you were 21 talking about 300,000, 500,000 miles, I could understand 22 that. Because when you talk about these traps and how 23 that stuff -- you know, when Mr. Kenny says, "Well, you 24 know, we never leave them out there. The trap 25 manufacturer will reimburse them"; well, all those people PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 80 1 who bought Zerex traps, I want to know when they're going 2 to get their money back; because, you know, those people 3 don't exist anymore. 4 CHAIRPERSON LLOYD: Except they weren't 5 certified. 6 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: 7 Yeah, they were not certified and couldn't -- 8 BOARD MEMBER BURKE: But I guarantee you there's 9 going to be examples similar to that. 10 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Dr. 11 Burke, I think one thing that Annette was pointing out 12 though is that the new truck purchaser gets a warranty on 13 the engine, he gets a warranty on the truck cab and the 14 drive train and all that stuff, and they make choices in 15 terms of purchasing extended coverage and all that stuff. 16 This retrofit warranty requirement is right in there in 17 terms of what happens with new trucks. So the real 18 question becomes, what happens to the used or older truck 19 purchaser? 20 BOARD MEMBER BURKE: That's the guy I'm worried 21 about. 22 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: And 23 there's two ways to look at it. One, is when you choose 24 to buy a used truck, you understand what you're getting. 25 In other words, you're understanding that you're not PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 81 1 getting a warranty on the engine or the transmission or 2 the tires or -- and that's why you don't pay as much -- 3 BOARD MEMBER BURKE: But if I go out and pay 4 $9,000 for a device -- 5 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Let 6 me finish, please. 7 BOARD MEMBER BURKE: -- you know, then -- 8 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: I'm 9 agreeing with you, as part -- 10 BOARD MEMBER BURKE: I'm sorry. I'm just getting 11 into -- 12 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: The 13 second part is, yes, we understand the relative costs of 14 the devices compared to some of the older trucks. And, as 15 I said earlier, that's something that we have to consider 16 as part of the regulations we would bring to you. And if 17 you had a problem with that and said, "Gosh, you were 18 asking these guys to put a device on that costs more than 19 a truck," you can tell us forget it, that it's a dumb 20 idea. 21 BOARD MEMBER BURKE: Well, let me ask you a 22 question. Since these extended warranties are available, 23 how much do they cost? 24 MS. WILLIAMS: Extended warranties -- I have a 25 survey of my members that shows 100 percent get PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 82 1 half-million-mile warranties or -- and then it goes up to 2 million-mile warranties. That's -- 3 BOARD MEMBER BURKE: No, I'm asking the staff, 4 you know, in their experience, how much is -- from 150,000 5 miles, how much is the additional cost for 150,000 miles 6 to 500,000 miles? Is it $200, $500, $5,000? 7 CHAIRPERSON LLOYD: Maybe Dawn could answer that. 8 MS. FRIEST: Sorry, I can't answer that question. 9 And I think it would vary from engine manufacturer to 10 engine manufacturer. I'm sure they all offer individual 11 packages -- 12 BOARD MEMBER BURKE: None of your engine 13 manufacturers are here? They just paid their lawyer to 14 come? 15 MS. FRIEST: In this case, actually some are 16 here, but we don't have the people who have the numbers. 17 BOARD MEMBER BURKE: Because I think that's a key 18 question, because I think that my colleague was suggesting 19 that, you know, maybe we could put a little pool of money 20 together for -- our of Moyer funds and buy -- you know, 21 make available extended warranties. 22 CHAIRPERSON LLOYD: But, again, I think what it 23 comes to -- and I'm going to exert Chairman's prerogative 24 here. We've got to separate this from the rules that are 25 coming up here. And I think what I heard Stephanie say, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 83 1 that, look, her big issue, biggest issue, only issue was, 2 in fact, the extended warranty. And so I think here if we 3 can actually look at that and focus on that part, we'd see 4 what the options are. We may not agree. 5 I'm not sure, Mr. Bertelsen, whether you were 6 going to comment on the extended warranty or whether you 7 were going to offer us a better deal. 8 MR. BERTELSEN: Well, I think that the answer to 9 the question is that companies will offer extended 10 warranties in terms of how much they are, as the folks at 11 EMA pointed out. It's really dependent on a lot of 12 factors. But that is one option. And the comment I guess 13 I would make, first of all, is I concur with the comments 14 that the staff made on this issue. I would add, in 15 addition to that, that the 150,000 mile warranty we 16 believe is appropriate, for the reasons that the staff 17 noted, that if there's a technology that has a problem, 18 you're going to be aware of it well before 150,000 miles. 19 And if an individual user wants some additional 20 protection, they want to pay for an extended warranty, 21 that is certainly an option. But whether it makes sense 22 from a public policy point of view to require everyone to 23 accept the cost of an extended warranty, I think is an 24 open question. 25 From our perspective, 150,000 miles as a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 84 1 mandatory requirement is a rigorous level. It's going to 2 weed out the problem technologies. 3 And I think the other thing that's important to 4 keep, in mind, again goes back to this process that we've 5 been discussing. It's extremely rigorous. It's designed 6 to keep out and root out the technologies that are problem 7 technologies. With 150,000 miles, if something comes 8 through and there is an issue, we're going to know. And 9 our industry, and I believe the engine manufacturers have 10 said the same thing, we're committed to coming up with 11 solutions that are going to be protective of the end user. 12 Now, Stephanie can respectfully disagree with our 13 perspective, but we're committed to that. And as an 14 industry, we've been committed to that proposition for 15 over 30 years. And we've delivered it time and time 16 again. 17 So we're confident we can do it. We're concerned 18 that the end user has a product that is effective. And 19 we're very confident that we can do it, and we think this 20 verification process provides the necessary safeguards to 21 ensure that the products that are out there work. 22 Talking about filter technology, there are 50,000 23 filter-equipped vehicles around the world. They're 24 operating effectively. And to my knowledge, there has not 25 been one instance in which a particulate filter failure PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 85 1 has caused an engine to fail. 2 MS. WILLIAMS: Which is why you should offer us 3 the longer warranty, because there's no liability to -- 4 MR. BERTELSEN: Stephanie, they'll offer the 5 warranty, but everything comes at a cost. If you buy an 6 extended warranty for your Panasonic TV -- 7 BOARD MEMBER BURKE: Well, what if there's not a 8 failure? There's no cost. 9 MS. WILLIAMS: Yeah, there's no cost. 10 BOARD MEMBER BURKE: There's no cost if there's 11 no failure. Don't get -- 12 CHAIRPERSON LLOYD: Please -- 13 BOARD MEMBER BURKE: What engine do you 14 manufacture? 15 MR. BERTELSEN: Pardon me? 16 BOARD MEMBER BURKE: What engine do you 17 manufacture? 18 We don't manufacture engines. Our companies 19 manufacture emission control technologies. 20 BOARD MEMBER BURKE: I see. I see. 21 CHAIRPERSON LLOYD: Mr. Kenny, you had a 22 question? 23 EXECUTIVE OFFICER KENNY: Well, actually -- I'm 24 not sure I have a question as much as I was going to 25 follow up on a lot of the testimony and maybe propose a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 86 1 semi-solution, which is that -- you know, it seems that 2 it's really a matter of cost. And what we have basically 3 been trying to do is provide a verification number of 4 150,000 miles and use that basically as the baseline when 5 we ultimately do our cost effectiveness determinations 6 when we propose regulations to the Board later on. 7 If we were to propose a 300,000 mile warranty, a 8 450,000 mile warranty, obviously the baseline costs will 9 go up and consequently cost effectiveness goes up. 10 You know, one thing we could do is essentially 11 stay with the 150,000 mile warranty for the verification 12 procedures, as we have indicated. But at the same time 13 take advantage of what Mr. Bertelsen just offered, which 14 was he did say that MECA members would probably be 15 offering additional extended warranties on the equipment. 16 And just like with the engines where the 17 consumers have the ability to purchase extended 18 warranties, we could also do a cost effectiveness on the 19 regulations that reflect when we do those regulations that 20 there is the option for additional warranty coverage if 21 it's so chosen to be purchased by the consumers. 22 And so, therefore, the verification procedures 23 would be at 150,000 mile warranties, and yet at the same 24 time when we, for example, did the fuel truck rule, we 25 could do the standard baseline cost effectiveness based on PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 87 1 the 150,000 mile warranty, but at the same time recognize 2 that there is a potential for extended warranty purchase 3 and, therefore, we would do an extended warranty purchase 4 cost effectiveness as well. 5 MS. WILLIAMS: But there's one problem with 6 all -- can I speak? Is it okay for me to jump in, Mr. 7 Chairman? 8 You're supposed to say yes. 9 CHAIRPERSON LLOYD: Well, just one minute here. 10 I just wanted to ask Mr. Kenny -- and I think that's a 11 good approach here. The one thing I was going to ask, 12 however, given what I'm hearing here, supposing between 13 now and the first rule we have -- there's increased 14 confidence by the manufacturers of the emission control 15 thing, so then they would say, "okay, well, we'll raise 16 that 150 up to," say, 300 or whatever it is. 17 Is there any mechanism in which we can use that 18 then as a new baseline, if you like? 19 EXECUTIVE OFFICER KENNY: Well, what we could do 20 if that occurred is essentially bring this verification 21 procedure back to the Board with a limited purpose of 22 changing the warranty requirement in the verification 23 procedures. 24 CHAIRPERSON LLOYD: Okay. Stephanie. 25 MS. WILLIAMS: The problem with -- the warranties PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 88 1 right now, everyone buys half-million-mile warranties. 2 And the engine manufacturers will not disagree with that. 3 I mean I can't imagine. I can bring in all the truckers, 4 if you'd like, so they can tell you, and each of them 5 could testify. But when you're saying you have to put on 6 a trap in a rule -- and I know you don't want to connect 7 the two, but it's not fair to the end user that you're not 8 connecting verification, which is why I would like you to 9 put this over until the waste rule comes up for a hearing 10 and do them at the same time. 11 CHAIRPERSON LLOYD: So you support the waste 12 rule? 13 MS. WILLIAMS: No. 14 CHAIRPERSON LLOYD: Thank you. 15 MS. WILLIAMS: But you're still working it out. 16 It's not really -- it's still a work of art. 17 But what I'm saying is, these retrofit devices, 18 when you say 150,000 miles and you mean four months to a 19 carrier, you're not -- so they offer an extended warranty. 20 The extended warranty is $2 million, so they can -- it's 21 an extended warranty, but it's not for the consumer. It's 22 for them to say they have the warranty because the engine 23 manufacturers do, but there's no market. We get to choose 24 who we're going to buy engines from. And we negotiate and 25 go in and see what is the best deal we can get. With the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 89 1 trap manufacturers you have to do this. There's only like 2 one or two. So you have to do this. You have to buy this 3 product. And the trap manufacturer has all the control. 4 There's no negotiation. It's -- the price is set. So it 5 won't be -- it'll be a 150,000 mile warranty, because 6 that's the minimum. 7 CHAIRPERSON LLOYD: But I think Mr. Kenny had an 8 approach there whether this will come back to us when 9 you're looking at the cost effectiveness. 10 Ms. D'Adamo, did you have a -- 11 No other questions. I think we're -- maybe 12 somewhere we have to come back to staff. 13 And then thank you for your testimony there. 14 Paul Beck, Oreste Bevilacqua, and then Brad 15 Edgar -- sorry -- Donel Olson. 16 MR. BECK: My name is Paul Beck. I'm an 17 executive with the company called Clean Air Partners, home 18 based in San Diego. 19 I didn't come here to wade in on the warranty 20 issue. But since I can answer a couple of the questions 21 that you didn't have answers for, I'd like you to consider 22 a couple things. And I'll speak for Caterpillar because 23 I'm closely related. I can tell you what their 24 warranty -- base warranty is two years unlimited miles on 25 the engine. And you need to think about the engine. The PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 90 1 truck doesn't matter in this particular case. Two years 2 unlimited. 3 I don't often agree with Stephanie, but they 4 almost all get the extended warranty. In the case of 5 Caterpillar, it's around $1,000 to go from two years 6 unlimited miles to 500,000 miles. 7 Now, the other thing you've got to consider is 8 typically -- and I've been on the receiving end of this 9 warranty thing because we do conversions of Caterpillar 10 engines. Anything we do that causes a catastrophic 11 failure of the engine is our problem. It isn't covered 12 under Caterpillar's warranty. So whether you're talking 13 about a new truck with a new engine warranty or a truck 14 that's out of warranty, when the catalytic -- if the 15 catalytic converter or soot trap would fail, albeit not 16 very often, and cause through back pressure a catastrophic 17 engine failure, I'll promise you there isn't an engine 18 manufacturer on the globe that's going to say, "Our 19 warranty covers that. We'll rebuild that engine for you, 20 $15,000." 21 And the catalytic converter maker's warranty is 22 going to say it's a material and workmanship warranty. 23 They're not going to say, "We'll cover the engine if it 24 destroys the engine." 25 That's an issue. I don't know how big it is. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 91 1 You ought to quantify it and be aware of it, because if it 2 does come to the point where you make a rule, and somebody 3 forces people to put these on their engine and the engine 4 fails and there's a $15,000 repair bill, that truck driver 5 is going to go looking for somebody to pay that $15,000. 6 And it's not going to be the catalytic converter maker and 7 it's not going to be the engine maker. 8 DEPUTY EXECUTIVE OFFICER CACKETTE: Mr. Chairman, 9 could we -- this has come up several times, and I'd just 10 like to add a point of fact. The regulation specifically 11 requires that if the trap or the device causes a failure 12 of the engine, that the trap manufacturer or the device 13 manufacturer is responsible for the repair of the engine 14 under warranty. So this issue, which was raised by both 15 people, is covered by the regulation and it shifts the 16 burden to the -- 17 BOARD MEMBER BURKE: How do we maintain 18 observation that the trap manufacturers know that they're 19 financially capable? If they have a massive recall, you 20 know, if they have massive problems, how do we know that 21 they've got the money to do that? Auditing those people? 22 DEPUTY EXECUTIVE OFFICER CACKETTE: We don't. 23 But we can look at -- there are smaller manufacturers and 24 there are larger manufacturers. Most people that are 25 playing in this game are multibillion dollar companies PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 92 1 that make the products. That doesn't mean that there 2 couldn't be a small company. But right now Engelhards, 3 Johnson, Matthews, I mean they're major, major people. 4 CHAIRPERSON LLOYD: Thank you. 5 MR. BECK: Back to the reason I came up here. 6 We are in favor of the verification process. We 7 have worked with staff and they've had input from us. We 8 only have one provision that I'm here to speak about that 9 I have a problem; and it's, there's been no workshops, 10 that's brand new language just showed up, hadn't seen it 11 before, there's been no chance for input. Specifically it 12 is Section 2706(b). On the surface it looked like it 13 shouldn't be a problem. 14 I have a problem with it, and here's the reason 15 why: We have new natural gas engines that we have 16 certifications for that we've gotten through CARB. We 17 have retrofit kits that we have certifications through 18 CARB as to the optional low-NOx standards. Supervisor 19 Roberts has supported our project with refuse trucks in 20 San Diego that have our technology. The City of Los 21 Angeles has just announced a 125-truck purchase for the 22 refuse fleet. They'll have our technology. We've enjoyed 23 many projects under Carl Moyer. 24 Yet, we have our engines certified by CARB; we 25 have retrofit kits certified by CARB. But this provision PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 93 1 would mean that we wouldn't be able to put catalytic soot 2 traps on L.A.'s refuse trucks and meet the requirements of 3 this verification rule. And we actually have a trap in 4 verification process now, in for submittal, waiting for a 5 response. And I don't believe that it was obvious to 6 anybody that this would have created a problem for us. So 7 there's no malice here. The section says, "In order to be 8 verified, the diesel emission control strategy must not 9 increase emissions of criteria pollutants -- nonmethane 10 hydrocarbons, CO, and NOx." 11 If you look at diesel emulsions for reducing NOx, 12 nonmethane hydrocarbons goes up; use EGR, CO goes up; 13 selective catalytic reduction, CO goes up. If you go to a 14 natural gas engine like the 1190 series rules from South 15 Coast, everybody is going to go to natural gas. And 16 ethane and methane don't burn as well as other fuels. And 17 you end up with some of that in the exhaust. 18 Ethane, although the Feds don't call it a 19 volatile organic compound, it's included in the nonmethane 20 hydrocarbon count. So you end up with nonmethane 21 hydrocarbons going up within the limits that are allowed 22 to certify a new engine. Yet it's more than 10 percent, 23 which is what this language says. So you can have a 24 problem with nonmethane hydrocarbons here, the 10 percent 25 rule, or the CO, primarily if you're doing what we're PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 94 1 doing and going to alternative fuels. 2 So I've got this dilemma where I've got our 3 natural gas engines retrofit kit certification; I'm in for 4 verification to add an Engelhard oxidation catalyst and 5 regenerative soot trap. We're down at .005 PM with that 6 to get well within the .03 requirement that they're trying 7 to get with the 1190 series rules. Yet unbeknownst to 8 anybody that don't let CO go up more than 10 percent or 9 don't let nonmethane hydrocarbons go up more than 10 10 percent stops me dead in my tracks. 11 So I'm not here to just complain. I have a 12 recommendation. 13 Specifically, you ought to let that apply to PM 14 and NOx. My recommendation would be CO and nonmethane 15 hydrocarbons are allowed to go up, but not anymore than 16 that which is allowed to certify a new engine. It's okay 17 to get a new engine cert. It's okay to get a retrofit 18 cert. It's okay for all the products under 1193 and Carl 19 Moyer and everything else. It ought to be okay under the 20 verification procedure. 21 CHAIRPERSON LLOYD: Does staff have a comment? 22 MR. BECK: And since it wasn't out to be talked 23 about at workshops, this is new news, my input. So I'd be 24 willing to work with folks. 25 But that would be my recommendation, is just PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 95 1 break CO and nonmethane hydrocarbons out, and it can't go 2 higher than what it would take to certify, say, to an 3 optional low NOx standard. In that case, it would be 4 fifteen and five on CO. 5 And we've gone and done full federal transient 6 tests with these devices back at, you know, EPA test labs. 7 We've done this just exactly the way all the OEMs do. 8 It's unfortunate that this language trips things up, I 9 think unintentionally. 10 CHAIRPERSON LLOYD: Well, maybe staff wants some 11 extra time to take a look at that? 12 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 13 HEBERT: No. I'd like to first clarify this language has 14 been there from the very beginning. Actually, the initial 15 language said no increase in hydrocarbons -- I mean -- or 16 hydrocarbons, CO, or NOx. Then we changed it to no more 17 than 10 percent increase in each one of those components 18 to allow for test to test variability. That is how it was 19 mailed out in the 45-day notice package. 20 Since then we have come up with some additional 21 15-day changes we propose, which was in the presentation. 22 And basically we're proposing to allow a limit on 23 pollutants three different ways: 24 1. The technology -- one way of meeting it is 25 not increasing nonmethane hydrocarbon, CO or NOx or PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 96 1 ammonia greater than 10 percent from the baseline before 2 your applied technology. 3 2. If you're verified prior to July 1st, 2006, 4 the applicant must provide evidence to demonstrate that 5 the nonmethane hydrocarbon plus NOx emissions are not 6 greater than the nonmethane hydrocarbon plus NOx emissions 7 in the baseline test. So that allows maybe the 8 hydrocarbons to increase, and then the NOx decrease, but 9 then you add the two together and it would kind of 10 counter -- counter-affects each other. 11 3. Would be after July 1st, 2006, that you have 12 the option of providing modeling data which shows that 13 even if you have increases in the different areas, it will 14 not impact or increase ozone similar to what we did on the 15 NO2ï issue. 16 So those would be three different ways that we're 17 providing some flexibility. 18 MR. BECK: It sure seems like following the 19 criteria to certify a low-emissions engine ought to be 20 sufficient to -- as well for verification. You know, 21 we're okay with the suggestion of adding nonmethane 22 hydrocarbons and NOx together. But the fact that you tie 23 it back to the baseline is only problematic for somebody 24 who's converting from a diesel to a gas engine. Because 25 the makeup of the nonmethane hydrocarbons from a diesel -- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 97 1 and they're very low. Diesels are real good at not having 2 very high nonmethane hydrocarbons. 3 When you convert it to a natural gas engine -- 4 and we're the only ones doing this -- you convert it to a 5 natural gas engine and then you add additional 6 after-treatment to even be lower, the baseline you're tied 7 back to is diesel, where you didn't have any ethane to 8 speak of in the nonmethane hydrocarbons, now you've got a 9 big content of nonmethane hydrocarbons that's -- it's 10 problematic. I just propose to you that on CO and 11 nonmethane hydrocarbons somehow the level the new engine 12 can put out ought to be okay for what's required on the 13 verification procedure. And the 10 percent doesn't get 14 that. 15 CHAIRPERSON LLOYD: Maybe we can have you work 16 with staff on that further. 17 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: 18 Yeah, the proposal that Annette outlined basically was 19 already an endeavor to take a shot at it. I think the 20 problem that we were trying to solve is that the diesel 21 engine, as he said, has huge NOx and tiny hydrocarbons; 22 and you can end up with traits that we really didn't want 23 to have happen happening. I think the staff proposal is a 24 shot at that. 25 We didn't think of CO. We'll look at CO, and we PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 98 1 can do that off-line with the Board's direction. 2 CHAIRPERSON LLOYD: So you think you can work it 3 out. 4 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: 5 Yeah. 6 CHAIRPERSON LLOYD: Good. Thank you. 7 MR. BRUCE WEAVER: If I could -- I'm Bruce 8 Weaver. I'm a consultant to Clean Air Partners. And I 9 want to -- I express my appreciation. The staff have 10 been, you know, very accommodating in meeting with us 11 after the 45-day notice came out when we saw this 12 10-percent impact provision. 13 We do think that the effective CO needs to be 14 looked at, the problem, of course, being that diesel 15 engines have extremely low CO emissions. So that the 10 16 percent -- a 10-percent increase in CO is basically zero. 17 And that problem will only get worse. And our 18 recommendation would be that, at least for CO, since CO is 19 not a significant concern from diesel engines anyhow, 20 simply to say that you can't exceed the emission standard 21 rather than a percentage increase. 22 DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah, I think 23 it's a good point on the CO. And we can take a look at 24 just doing what they say on CO. 25 We did give a lot of consideration to the issue PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 99 1 on hydrocarbons though and we came up with this other 2 alternative approach, because the hydrocarbon standard for 3 diesel engines is kind of like way above where the engines 4 are, and so it allows a fairly large increase. And in the 5 interim we thought it was better to say, "Well, you can 6 have a hydrocarbon increase. But how much you can have is 7 dependent on how good you are on NOx." And let those two 8 trade off so that the net does not have any increase. And 9 we think that was probably a pretty good solution. 10 If Mr. Beck's engines are being certified as a 11 natural gas engine, plus a filter, then obviously the NOx 12 is going down, which lets the hydrocarbon go up. If he's 13 taking the natural gas engine only and then just -- I 14 mean, that's the only way it would work, where you have 15 the hydrocarbons. So I don't think he has a problem from 16 that standpoint, if I understand the issue, because 17 clearly most of the natural gas applications cut NOx by 50 18 percent or something in that order of magnitude. 19 CHAIRPERSON LLOYD: So you're comfortable with 20 staff working with Mr. Beck on that. 21 Okay. Thank you. 22 BOARD MEMBER ROBERTS: Mr. Chairman, just for my 23 own -- it's not clear to me. Mr. Beck made a suggestion, 24 but it sounds like maybe that's not acceptable. And I 25 understand the -- I don't want to get into an argument of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 100 1 the history of how this all came about. But if at the end 2 of the day there's not a concurrence, what happens? It 3 comes back to us then? 4 CHAIRPERSON LLOYD: Yes, they would come back to 5 us. I'm sharing some of your concern because I'm -- but 6 I'm not sure whether they're communicating it exactly, but 7 I'm not sure we can get that done here. 8 BOARD MEMBER ROBERTS: Well, that's what -- you 9 know, I hear people talking, but I'm not sure if there's a 10 meeting of the minds here. 11 CHAIRPERSON LLOYD: I think Mr. Kenny would come 12 back to us if that was the case. 13 EXECUTIVE OFFICER KENNY: It seems like we have a 14 meeting of the minds with regard to the CO. It seems like 15 with regard to the HC plus NOx -- I mean -- 16 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: I 17 think we have a meeting of the minds there, too. I think 18 the issue -- 19 EXECUTIVE OFFICER KENNY: Well, that's what it 20 sounds like. But I wasn't -- I mean, I think -- 21 BOARD MEMBER ROBERTS: I'm going to trust that we 22 will hear from one party or another if there's not a 23 solution to this. 24 MR. CHRISTOPHER WEAVER: We would like to see the 25 new language. And I think some of the confusion here may PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 101 1 be that we have not yet seen the 15-day notice language 2 that contain these changes, so we were responding to the 3 material in the 45-day notice. 4 I would also like to raise a potential issue 5 though that I heard I think Ms. Hebert mention, that this 6 provision would now cover ammonia. And there I think you 7 would get into very much the same issue that you have 8 with -- 9 CHAIRPERSON LLOYD: Well, please take it up with 10 staff. 11 MR. CHRISTOPHER WEAVER: -- with CO, because 12 baseline ammonia emissions from diesels are extremely low. 13 So you would basically not -- if you base it on a 14 percentage, you wouldn't be able to implement SCR. And we 15 see SCR as a potentially very attractive technology. 16 BOARD MEMBER ROBERTS: I think we've got so many 17 problems with the natural gas, and I think we want 18 staff -- we want this as an option, so we want staff to 19 work with you and work it out. 20 CHAIRPERSON LLOYD: Exactly. Thank you. 21 Oreste -- 22 MR. CHRISTOPHER WEAVER: For the record, my name 23 is Christopher Weaver. And I'm a consultant to Clean Air 24 Partners. 25 CHAIRPERSON LLOYD: And then Donel Olson and Brad PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 102 1 Edgar. 2 MR. BEVILACQUA: Good morning. My name is Oreste 3 Bevilacqua. I'm involved with doing light-duty and 4 heavy-duty testing. 5 And I've talked with the staff once or twice 6 before about -- one issue we have with the verification 7 process. And it has to do with the cold test you're 8 running at the beginning of a -- on a UDDS. 9 And the concern we have is, typically when you're 10 operating a truck, you don't get in the car and -- I'm 11 sorry -- get into the cab and start driving away right 12 away. There is always provisions for having -- building 13 up air pressure for brakes, getting temperatures up. And 14 so we feel that it might be more advantageous to look at 15 it a little differently. And one of the suggestions from 16 talking with several people is that if you do a cold test, 17 maybe at the beginning you start it to replicate what 18 drivers do. Maybe for the first five minutes or so you 19 just take idling emissions and then afterwards then you 20 actually start the test. That's basically my question. 21 And also from an operational point of view, if 22 you're doing a cold UDDS, it's very hard to control the 23 vehicle because it's just -- the brakes don't work as 24 well. 25 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: Yes. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 103 1 MR. BEVILACQUA: Okay. 2 CHAIRPERSON LLOYD: Problem solved? 3 MR. BEVILACQUA: Okay, great. Thank you. 4 CHAIRPERSON LLOYD: Thank you. 5 Donel Olson, Brad Edgar. 6 MR. OLSON: Board Members and staff, thank you 7 for letting me speak with you. My name is Don Olson. 8 CHAIRPERSON LLOYD: I think this -- 9 GENERAL COUNSEL WALSH: You might want to walk 10 over here to this one. 11 MR. OLSON: Are we okay here? 12 CHAIRPERSON LLOYD: Yes. 13 MR. OLSON: My name is Don Olson and my company 14 is Olson Engineering, Incorporated. We're involved, among 15 other things, in the emission testing of vehicles and 16 heavy-duty engines and several -- over the years had 17 several laboratory facilities that we instrumented and 18 equipped and operated across the United States and in 19 Germany. 20 And, in addition, we provide emission control 21 systems for light-duty vehicles in the past and heavy-duty 22 vehicles' engines now. I guess we've probably provided 23 several hundred thousand emission control systems, many of 24 them here in California, but across the nation and in 25 other countries. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 104 1 I did provide a white paper with my comments. 2 I'm going to skip through the -- two or three of the 3 comments that I thought might be helpful in this 4 verification protocol, in the interest of time, and skip 5 through to the one that I think is by far the most 6 important. I'm asking that you consider the verification 7 procedures and protocol to include the retrofit of dual 8 fuel systems for heavy-duty engines in off-road 9 applications. And I've provided several comments in my 10 paper that help to verify that, I hope. 11 Dual fuel retrofit systems for heavy-duty engines 12 is by far the most cost-effective solution to reduce both 13 particulates and oxides of nitrogen that's available. 14 It's a commercially available capability. It's not -- 15 it's mature technology. It goes back to Rudolph Diesel 16 when he first invented the diesel engine. And there's 17 thousands of dual fuel systems on heavy-duty engines in 18 operation across the United States that have been 19 certified at the OEM level. But there's not a verifiable 20 retrofit procedure available. And it should be included 21 as a protocol, and isn't included as a protocol in this 22 verification procedure. 23 I say it's the most cost-effective approach 24 that's available. It actually -- I don't know of anything 25 else that actually pays for itself to reduce oxides of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 105 1 nitrogen. And I say pays for itself. Let me just give 2 you an example that I provided in this paper that I 3 provided to you. 4 A 200-horsepower engine operating -- diesel 5 engine operating on diesel fuel, say, pumping water in the 6 San Joaquin valley -- and we have dozens of installations 7 there in this application -- uses about -- it costs about 8 $8 an hour to operate that engine on diesel fuel using 80 9 cent diesel fuel -- 80 cent a gallon diesel fuel. And 10 using a dual fuel system it substitutes 80 to 90 percent 11 natural gas, in this case, for the diesel fuel. And that 12 natural gas we've used in our example is costing $3 MCF, 13 which is a pretty reasonable number at the present time. 14 Dual fuel operation of that engine would cost $5 15 an hour, more than a 40-percent reduction in operating 16 costs. So in the process, this dual fuel retrofit 17 installation will reduce oxides of nitrogen on the order 18 of 50 percent or more and also particulates on the order 19 of 50 percent or more. So in a matter of 1,500 hours of 20 operation you've paid back the capital costs of the 21 retrofit installation while simultaneously reducing oxides 22 of nitrogen and particulates by 50 percent or more. And, 23 in fact, if you use some other conservative alternatives, 24 you could use additives with a diesel fuel supplement or 25 you could substitute biodiesel fuel for the diesel fuel PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 106 1 supplement, and reduce particulates even further. 2 A typical dual fuel retrofit can cost in the 3 order of $25 a horsepower. 4 Just to put that into perspective for you, 5 natural gas -- a dedicated natural gas engine at the OEM 6 level costs $500 a horsepower or more. A diesel engine 7 costs $100 a horsepower or more. So we add $25 a 8 horsepower to $100 a horsepower -- for $125 a horsepower 9 you can get 80 to 90 percent of the effect of a dedicated 10 natural gas engine with considerably less complexity. 11 So that's my main issue that I'd like to have the 12 Board consider and hopefully instruct the staff to 13 evaluate the inclusion in this verification procedure of 14 dual fuel systems for retrofit. I'm not talking about 15 over-the-road applications. Now, I'm talking about 16 off-road stationary engine applications and off-road 17 engine applications with a dual fuel system. 18 And I can help provide -- we have considerable 19 data on this technology, and I can help provide that. So 20 that's my recommendation. 21 And I would like to make a comment, however, as 22 an independent testing laboratory facility -- we're 23 operating a couple heavy-duty engine test facilities in 24 southern California at the present time -- that we're 25 seeing quite a bit of new interest -- not quite a bit -- a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 107 1 lot of new interest in companies, not necessarily big 2 companies as we've heard about, but a lot of smaller 3 companies and some big companies in providing the emission 4 testing for this verification procedure. 5 And I'm pleased to comment that some of these 6 actually work, and there is, in fact, some benefit from -- 7 significant benefit from some of these devices. So I want 8 to commend the Board, of course, and the staff for the 9 work they've done on this verification procedure. I 10 believe it's really a major step forward in terms of 11 reducing emissions and cleaner air in California. And I 12 mean that sincerely on the basis of what I've seen. 13 I'd be glad to answer any questions about that. 14 CHAIRPERSON LLOYD: Thank you very much, Don. 15 Does staff have a -- 16 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: We 17 thought that the dual fuel engines were covered. So I 18 guess -- was there specific language in the procedure 19 which led you to conclude that they weren't, that we can 20 fix, because we were trying to cover them. 21 CHAIRPERSON LLOYD: Okay. So, again, you can 22 work it out if you have some more detailed discussions. 23 MR. OLSON: Well, I'm glad to hear that because I 24 thought there was specific language. So I will -- or my 25 conversation with the staff, I came to that conclusion. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 108 1 So maybe we're on the same piece of paper then. 2 CHAIRPERSON LLOYD: Sounds like it. 3 MR. OLSON: Okay. Well, I'll come in and talk 4 with them. 5 CHAIRPERSON LLOYD: Thank you for your comments. 6 To work it out I think would be good. 7 Brad Edgar. 8 MR. EDGAR: My name is Brad Edgar. I'm Chief 9 Technical Officer of Cleaire Advanced Emission Controls, 10 which is a division of Cummins West located in San 11 Leandro. We are a manufacturer of emissions controls and 12 a member of MECA, the Association of Manufacturers of 13 Emission Controls. 14 I just had a couple of comments. 15 One, I wanted to commend the staff for the work 16 they've done to put together the rule. We do think it is 17 fair and reasonable and also challenging. And I think 18 what that will accomplish is you'll get durable 19 technologies but you'll also open the procedure up to be 20 competitive so that issues such as engine durability 21 after-treatment-system durability will be addressed 22 sheerly through the nature of competition. 23 Now, I just had a couple of kind of nerdy 24 technical comments. 25 One, I wanted to mention that we don't PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 109 1 necessarily support the use of a cold-start test as well 2 on chassis dynamometer testing because we just don't think 3 it's necessarily practical nor safe. 4 And the second, I want to clarify on page 14. We 5 submitted questions to ARB on the verification procedure, 6 asking whether or not the systems that are tested at zero 7 miles have to be the identical systems that are tested in 8 the post-durability phase, or rather can one test separate 9 but identical systems? That way we could take systems 10 that are in the field and have been accumulating mileage, 11 and when they reach a 50,000 mile mark, test them; and 12 then test an identical yet separate system. I think that 13 would greatly speed up the verification process. 14 I think that's particularly important when we're 15 considering applications of systems that are running on, 16 for example, refuse or transit buses where mileage 17 accumulation could be as low as 10,000 to 20,000 miles a 18 year. What that may lead to is requiring three to five 19 years to achieve the durability requirements. So I think 20 that -- again, the offer would be that if we could ensure 21 that we had identical but separate systems, we could then 22 begin accumulating mileage. And once we achieve that 23 mileage, test the systems and then test the zero-mileage 24 system and compare those for deterioration effects. 25 Thank you. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 110 1 CHAIRPERSON LLOYD: Thank you. 2 Any staff comment there? 3 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 4 HEBERT: We are allowing in exactly what Brad proposed. 5 MOBILE SOURCE CONTROL DIVISION CHIEF CROSS: And, 6 yeah, the other comment that -- she's saying that we're 7 allowing what Brad proposed in terms of the durability 8 demonstration testing requirements. With respect to the 9 cold start, I think I gave a very brief "yes" answer 10 earlier to another witness. And we're going to look at 11 the cold start. I think Tom and I both agree that it's 12 maybe an unnecessary piece of the test procedure, and 13 we'll look at that with the staff and put it up as a 14 15-day issue and see if we can take care of it. 15 CHAIRPERSON LLOYD: Thank you. 16 Thank you very much. 17 With that I guess we have no more comments. 18 Mr. Kenny, do you have anymore comments? 19 EXECUTIVE OFFICER KENNY: Nothing further. 20 CHAIRPERSON LLOYD: I guess I'll now close the 21 record on this agenda item. However, the record will be 22 reopened when the 15-day notice of public availability is 23 issued. Written or oral comments received after this 24 hearing date but before the 15-day notice is issued will 25 not be accepted as part of the official record on this PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 111 1 agenda item. 2 When the record is reopened for a 15-day comment 3 period, the public may submit written comments on the 4 proposed changes which will be considered and responded to 5 in the final statement of reasons for Regulation. 6 Do we have any ex parte communications on behalf 7 of my -- 8 No. Then I guess we won't have some discussion 9 on the item. 10 The one thing I just want to clarify, Mr. Kenny, 11 here is that -- and, again, I'd like to, in our discussion 12 here, keep it separate in terms of what we're looking to 13 the verification procedure to the implementation, which is 14 going to come up before us. But the big issue here is 15 clearly the warranty issue. And I know that, Mr. Kenny, 16 you've been on other issues a tremendous supporter of 17 getting -- protecting the consumer and getting the maximum 18 warranty possible, certainly on the light-duty side. 19 Do you think in this case that we have pushed the 20 manufacturers as far as we can at this stage? 21 EXECUTIVE OFFICER KENNY: I think we have, at 22 this stage. I mean -- and you are right. I mean what we 23 have tried to do as a staff is really push the kind of 24 environmental protection and consumer protection efforts 25 together so that, in fact, we would be able to get the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 112 1 most bang for the buck and make sure we protect the 2 consumers to the greatest extent possible. 3 I think in this particular situation what we are 4 talking about is a 150,000 mile warranty as being a great 5 place to begin. You know, I would expect that as time 6 goes on we will probably come back to the Board and we 7 will probably be pushing that warranty up. 8 I do think also that for purposes of cost 9 effectiveness, so that the Board has the full range of 10 information at the time that it is making a determination 11 on any particular regulatory requirement for a category of 12 engines, that it probably is reasonable that the Board 13 should have additional information that is beyond the 14 150,000 mile warranty verification number that we have 15 proposed today. And so that's why I was suggesting that 16 what the Board might want to consider doing is at least 17 having the verification procedures go into place at the 18 150,000 mile level, but at the same time ask us to at the 19 time we are providing to the Board cost effectiveness 20 numbers for any particular regulatory requirement, that we 21 actually also look at higher warranty numbers, so that the 22 Board then has before it the full range of information 23 that it can take into account in terms of what it is 24 requiring on a particular category of engines. 25 As part of that, I think what I would like to do PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 113 1 is actually, you know, sit down with Stephanie a little 2 bit further and kind of get a better understanding as to 3 what the warranty requirements that she is currently 4 facing with the engines are and try to tie that a little 5 bit together with regard to what we're asking for in after 6 treatment; and then make sure that I can provide that to 7 the Board at the time we're doing any kind of regulatory 8 proposal. 9 CHAIRPERSON LLOYD: Yeah, I think that's a good 10 suggestion, because I think it's very clear we need to do 11 more work with the end user here. And I think we're also, 12 more honestly, putting the manufacturers' emission control 13 equipment on notice here that this is a big issue, that 14 anything you can do to help us extend that warranty or 15 provide, as we heard Brad Edgar say, maybe competition so 16 that, in fact, warranty does become clearer to the market 17 place is going to be -- that would be very helpful all 18 around. 19 BOARD MEMBER D'ADAMO: Just on that point. I'm 20 wondering if you could again clarify your earlier comment, 21 Mr. Kenny, about an extended warranty and how that would 22 fit in with the cost effectiveness. 23 EXECUTIVE OFFICER KENNY: Sure. What we would do 24 is, for example, when we brought the waste hauler rule to 25 the Board, we would actually calculate the base -- cost PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 114 1 effectiveness number on the basis of a 150,000 mile 2 warranty, we would provide a second or even potentially a 3 third cost effectiveness number, which would take into 4 account the purchase of extended warranties that would run 5 the warranty timeframe up to 300,000 miles or something 6 greater. 7 BOARD MEMBER D'ADAMO: Okay. 8 CHAIRPERSON LLOYD: Supervisor Roberts. 9 BOARD MEMBER ROBERTS: Mr. Chairman, I'm actually 10 feeling comfortable today. I know that's a rarity 11 sometimes. But I'd like to move the approval of this 12 subject to the points that were raised by Mr. Beck and the 13 follow through of Mr. Kenny on the warranty issues. 14 BOARD MEMBER BURKE: I'd like to second that. 15 EXECUTIVE OFFICER KENNY: There was one other 16 matter that was raised by Mr. Calhoun with regard to the 17 February 1st date and the four-percent failures. And I 18 guess I was curious also about the sentiment of the Board 19 with regard to changing that so that, in fact, we would 20 get reports earlier if, in fact, that four-percent failure 21 was beginning to occur. 22 CHAIRPERSON LLOYD: I think that's appropriate. 23 BOARD MEMBER ROBERTS: Yeah, I'd like to see that 24 included also as part of the motion. 25 CHAIRPERSON LLOYD: We got a seconder? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 115 1 BOARD MEMBER BURKE: Yeah, I'll second it. 2 I'd like to make a comment, if I could. 3 CHAIRPERSON LLOYD: Yes. 4 BOARD MEMBER BURKE: I'd like to congratulate the 5 staff. I know this was arduous today, I know contentious 6 at times. But I think that your compromise that you 7 worked out is really effective and we'll be able to 8 analyze what it's really worth for that extended warranty. 9 We all know that the extended warranty business 10 is a very lucrative business. So we want to really hone 11 that to the bone when we bring it back to the Board and 12 make sure it's as lean as can be. 13 CHAIRPERSON LLOYD: And also I think, just to let 14 staff know, there is nothing that would please -- I 15 presume my colleagues -- and certainly nothing would 16 please me more that when we come back with the waste rule 17 that we will have the support of Stephanie. 18 (Laughter.) 19 BOARD MEMBER ROBERTS: I'm not sure I could 20 support it in that event. 21 BOARD MEMBER BURKE: That could happen. 22 (Laughter.) 23 BOARD MEMBER ROBERTS: She left. 24 BOARD MEMBER RIORDAN: Sorry, Mr. Chairman. 25 BOARD MEMBER ROBERTS: That's an editorial PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 116 1 comment. It's not part of the motion. 2 CHAIRPERSON LLOYD: All in favor of the motion as 3 proposed by Supervisor Roberts and seconded by Dr. Burke, 4 all in favor say aye. 5 (Ayes.) 6 CHAIRPERSON LLOYD: Anybody against? 7 Unanimously carried. 8 Again, thank you. And thank you, staff, and 9 thank you for all the witnesses here. 10 We have no other business here or persons to 11 testify. So with that, I will bring the May 16th, 2002, 12 meeting of the Air Resources Board to a close. 13 Thank you very much. And I guess it's next month 14 we'll see you in El Monte. 15 (Thereupon the Calfornia Air Resources 16 Board meeting adjourned at 11:30 a.m.) 17 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 117 1 CERTIFICATE OF REPORTER 2 I, JAMES F. PETERS, a Certified Shorthand 3 Reporter of the State of California, and Registered 4 Professional Reporter, do hereby certify: 5 That I am a disinterested person herein; that the 6 foregoing California Air Resources Board meeting was 7 reported in shorthand by me, James F. Peters, a Certified 8 Shorthand Reporter of the State of California, and 9 thereafter transcribed into typewriting. 10 I further certify that I am not of counsel or 11 attorney for any of the parties to said meeting nor in any 12 way interested in the outcome of said meeting. 13 IN WITNESS WHEREOF, I have hereunto set my hand 14 this 28th day of May, 2002. 15 16 17 18 19 20 21 22 23 JAMES F. PETERS, CSR, RPR 24 Certified Shorthand Reporter 25 License No. 10063 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345