Comment Log Display

Lockheed Martin is a global security and aerospace company that
employs approximately 98,000 people worldwide and is principally
engaged in the research, design, development, manufacture,
integration and sustainment of advanced technology systems,
products and services.  We appreciate the opportunity to provide
comments to the California Air Resource Board (known herein as
‘Board’) regarding the proposed amendments to the CALIFORNIA CAP ON
GREENHOUSE GAS EMISSIONS AND MARKET-BASED COMPLIANCE MECHANISMS
REGULATION, particularly the amendment set forth in Appendix A:
Proposed Regulation Order, Section 95852.2(b)(2), which removes the
compliance obligation exemption on emissions from natural gas
hydrogen fuel cells.  Lockheed Martin respectfully disagrees with
the Boards intention to eliminate the aforementioned exemption. 
Natural gas hydrogen fuel cells efficiently and electrochemically
convert fuel into low-carbon, baseload electricity.   Greater
energy efficiency means less fuel consumed to produce the same
output of electricity, and that lower fuel consumption corresponds
to fewer CO2 emissions.  Even when compared to advanced centralized
combined cycle gas turbine power plants equipped with the best
available control technology (BACT) — the US EPA's benchmark —
natural gas hydrogen fuel cells delivers a lower CO2 footprint due
to higher electricity efficiency.
Companies like Lockheed Martin recently invested in this technology
with the understanding that the Board would continue to include
such emissions in the compliance obligations (exemptions) of
Section 95852.2.  We invested significant money into the design and
purchase of the capital equipment.  We have also devoted
substantial time into the operation and maintenance of the
equipment to maximize efficiencies.  All of these actions were
completed under the assumption of regulatory relief from the Cap
and Trade program.  
For the reasons outlined above, Lockheed Martin recommends that the
Board retain the language in Section 95852.2(b)(2).  By retaining
this language, the regulated community will be able to recognize
the existing benefits (investments) in clean electricity producing
technology, while potentially investing in future cleaner
technologies.  At a minimum, the Board should consider retaining
the exemption and offering a compliance date of no less than 3
years for newly installed fuel cells.  This would enable existing
sites with fuel cells to fully recognize the benefit of their
investments, while providing time for new projects to evaluate the
benefits of the investment.