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# Appendix F:

Optional Trailer Fleet Compliance

SchedulesF-2

Appendix F: Optional Trailer Fleet Compliance Sche dules

The proposed regulation would require all 2010 and previous model year 53-foot or longer box-type trailers that operate in Califor nia to be compliant with its equipment requirements before January 1, 2013. Alt ernatively, in lieu of meeting this compliance deadline, trailer owners would also have the option to participate in one of two optional trailer fleet compliance sch edules. These schedules include the large fleet compliance schedule for fle ets of 21 or more 53-foot or longer box-type trailers, and the small fleet compl iance schedule for fleets with 20 or fewer 53-foot or longer box-type trailers. The trailer fleet compliance schedules would be available for 1) dry-van trailer s and 2) refrigerated-van trailers that the owner elects not to bring into co mpliance with the refrigerated fleet compliance provision, as described in Chapter VIII, Requirements and Compliance Deadlines.

For the purposes of this proposal, a “nonconforming trailer” means a trailer that does not meet the equipment requirements of the pro posed regulation. Under the two optional trailer fleet compliance schedules , trailer owners would be required to retrofit applicable nonconforming trail ers with SmartWay equipment to bring them into compliance with the proposed regula tion or retire them from California service according to an established time line. By participating in any compliance schedule, trailer owners would be agreei ng to allow ARB to periodically audit their vehicles and records to en sure that they are in compliance with all air quality regulations. ARB would reserv e the right to terminate an owner’s participation in any compliance schedule sh ould the owner be found in violation of the proposed regulation. If participa tion in a compliance schedule is terminated by ARB, the owner would be required to r each full compliance within 90 days or by December 31, 2012, whichever is later , but no later than December 31 of the final compliance year of the app licable compliance schedule.

A. Minimum Fleet Compliance Thresholds

Under either of the two optional trailer fleet comp liance schedules, a trailer owner would be required to meet certain minimum fleet com pliance thresholds. A minimum fleet compliance threshold is the percentag e of total trailers participating in a compliance schedule that must be either in compliance or retired by the end of a compliance year. Minimum f leet compliance thresholds would increase from year to year, and a trailer own er participating in a trailer fleet compliance schedule would be required to retrofit o r retire a sufficient number of nonconforming trailers every year to meet these com pliance thresholds. The large fleet compliance schedule would have six annu al minimum fleet compliance thresholds starting in 2010, and the small fleet co mpliance schedule would have four annual minimum fleet compliance thresholds sta rting in 2013.

B. Trailer Fleet List

Fleet owners participating in a compliance schedule would be required to provide a trailer fleet list, which would include informati on on all 53-foot or longerF-3

box-type trailers within the fleet, including compl iant, nonconforming, exempted, and refrigerated trailers. The trailer fleet list would serve the following purposes:

• The number of trailers on this list would be used to ensure that fleets of 21 or more trailers do not participate in the small fl eet compliance schedule.

• Except for refrigerated trailers to be phased-in u nder the refrigerated fleet compliance provision, and exempted trailers, only t railers participating in a trailer fleet compliance schedule would be allowed to be nonconforming after December 31, 2012. Therefore, the trailer fl eet list would provide

ARB a means to differentiate these trailers from no nconforming trailers that would be operating in violation of the propose d regulation.

• The list would also provide ARB with a tool with w hich to enforce the provisions of these compliance schedules and ensure that participating fleets are bringing their trailers into compliance as they are required.

• The list would be used to determine the compliance base number, which, in turn, would be used to calculate the retrofit an d retirement commitments for each compliance year. The compliance base numb er would be the total number of nonconforming trailers that owners would choose to bring into compliance over the course of the applicable t railer fleet compliance schedule. The compliance base number would not inc lude the following:

1. Delayed compliance trailers, as determined in ac cordance with the early compliance option, as described in E.1.

2. Early compliance trailers (trailers in complianc e before January 1, 2010),

3. Exempted trailers, or

4. Refrigerated-van trailers for which compliance w ould be delayed pursuant to the refrigerated fleet compliance provi sion.

Compliant trailers that are not used to delay retro fits and retirements of delayed compliance trailers pursuant to the early c ompliance option (as described in E.1) could also be included in the com pliance base number and used to meet annual minimum fleet compliance th resholds.

Except upon specific Executive Officer approval, AR B would not allow alterations to the number or identity of trailers on the traile r fleet list once the submission due date of the applicable compliance plan has pass ed. That is, outside of providing additional information about the trailers already listed, no other changes would be allowed. Model year 2010 and pre vious trailers brought into California after the applicable due date would not be eligible to participate in a trailer fleet compliance schedule, and would have t o be compliant by December 31, 2012. Executive Officer approval woul d only be granted for extenuating circumstances, such as company mergers, acquisitions, or splits.F-4

C. Compliance Plan

To participate in an optional trailer fleet complia nce schedule, a trailer owner would be required to submit a compliance plan outli ning how the owner plans to meet the applicable minimum fleet compliance thresh olds. The plan would have to include, for each compliance year, a detailed li st of nonconforming trailers to be retrofitted or retired that year. The number of trailers included on each list would have to be enough to ensure that the fleet me ets the minimum fleet compliance threshold for that applicable compliance year. By providing these lists, the owner would be making a commitment to re trofit or retire these trailers as reported. Failure to meet these commitments wou ld constitute a violation of the proposed regulation.

D. Small Fleet Versus Large Fleet

The proposed regulation would offer a deferred comp liance schedule for smaller fleets, providing additional time for them to bring their trailers into compliance. For the purposes of the trailer fleet compliance sc hedules, staff defined a “small

fleet” as a fleet with 20 or fewer trailers. Staff established this definition by using transportation revenue estimates (CEC, 2007; EIA, 2 008; and OOIDA, 2004) and

the definition of “small business” set forth in Gov ernment Code 11342.610.

To determine fleet size, fleets would have to accou nt for all 53-foot or longer box-type trailers within the fleet, including exemp ted trailers, compliant trailers, nonconforming trailers, and refrigerated trailers.

E. Large Fleet Compliance Schedule

The large fleet compliance schedule was established for fleets of 21 or more 53-foot or longer box-type trailers. If a trailer owner does not participate in the early compliance option, the large fleet compliance schedule would provide fleet owners six years to either retrofit all their nonco nforming trailers to meet the equipment requirements of the proposed regulation o r retire such trailers from California service. The annual minimum fleet compl iance thresholds for the large fleet compliance schedule are presented in Table F- 1 below.

Table F-1: Minimum Fleet Compliance Thresholds fo r Large Fleets

Compliance Year 2010 2011 2012 2013 2014 2015 Fleet Compliance

Threshold 5% 15% 30% 50% 75% 100%

Staff believes that six years is enough time for ma nufacturers of SmartWay trailers and equipment to increase production capac ity to match the expected increase in demand for their products. In addition , the time would allow certain fleets to better manage the concurrent financial an d logistical impacts of the proposed regulation and the proposed Truck and Bus Rule.F-5

1. Early Compliance Option

The large fleet compliance schedule would also prov ide an option to delay

retrofits and retirements until 2016 if an owner ha s compliant trailers operating before January 1, 2010. For the purposes of the ea rly compliance option, an “early compliance trailer” means a trailer brought into compliance before January 1, 2010, and a “delayed compliance trailer” means a trailer for which compliance may be delayed until 2016. Under the ea rly compliance option, one trailer brought into compliance before January 1, 2 009 would allow the delay of

1.5 trailer retrofits or retirements until 2016. H owever, a trailer owner would only be allowed to delay a maximum of 30 percent of the total number of trailers participating under the large fleet compliance sche dule, which for this purpose, would also include their early compliance trailers. For example, a person who owns 100 trailers would be allowed to delay the com pliance of up to 30 trailers until 2016, if they had brought at least 20 trailer s into compliance by December 31, 2009.

Delayed compliance trailers would be subtracted fro m the total pool of nonconforming trailers for the purpose of determini ng the compliance base

number and retrofit and retirement commitments for compliance years one through six. Therefore, participating in this opti on would reduce the number of

trailers that would have to be retrofitted or retir ed each year during the six-year compliance schedule. Delayed compliance trailers w ould have to be brought into compliance by December 31, 2016.

The early compliance option would provide additiona l flexibility for trailer owners,

but also ensure that GHG reductions would not be lo st.

2. Large Fleet Compliance Plan Revision

Prior to the fourth compliance year, ARB would allo w a trailer owner participating in the large fleet compliance schedule to submit a large fleet compliance plan

revision to reorder trailer retrofit and retirement commitments for compliance years four, five, and six. For example, a trailer owner would have the option to switch a trailer scheduled for a fourth year retrof it with a trailer scheduled for a sixth year retrofit if, for some reason, the latter trailer was brought into compliance earlier than expected. This optional pr ovision would provide trailer owners additional flexibility to re-evaluate their compliance plans at the mid-point of the compliance schedule. However, trailer owner s opting to revise their compliance plan would not be allowed to alter commi tments in a way that would result in the fleet’s failure to meet an applicable minimum fleet compliance

threshold.

F. Small Fleet Compliance Schedule

For fleets with 20 or fewer 53-foot or longer box-t ype trailers, the small fleet compliance schedule may be used. This schedule pro vides additional time for smaller fleets to begin bringing their trailers int o compliance. The annualF-6

minimum fleet compliance thresholds for the small f leet compliance schedule are presented in Table F-2 below.

Table F-2: Minimum Fleet Compliance Thresholds fo r Small Fleets

Compliance Year 2013 2014 2015 2016 Fleet Compliance

Threshold 25% 50% 75% 100%

The benefits of the small fleet compliance schedule would include:

• Smaller fleets would have additional time to base their decisions on what technologies larger fleets are using.

• Demand from larger fleets would stimulate equipmen t production and potentially drive down prices in later years when s maller fleets would need to comply.

• The delay would provide additional lead-time for s maller fleets to devise their compliance strategies.

G. Reference

CEC, 2007. California Energy Commission. Transportation Energy Forecasts for the 2007 Integrated Energy Policy Report. CEC-600-2007-009-SF. September 2007. http://www.energy.ca.gov/2007publications/CEC-600-2 007-009/CEC-600-

2007-009-SF.PDF

EIA, 2008. Energy Information Administration. Diesel Historical Data (.xls). http://tonto.eia.doe.gov/oog/info/wohdp/diesel.asp

OOIDA, 2004. Owner Operator Independent Drivers As sociation. 2004 Owner Operator Member Profile Survey

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