CALIFORNIA ENVIRONMENTAL PROTECTION AGENCY

AIR RESOURCES BOARD

STAFF REPORT: INITIAL STATEMENT OF REASONS

SUPPLEMENTAL REPORT

PROPOSED DIESEL PARTICULATE MATTER CONTROL MEASURE FOR ON-ROAD

HEAVY-DUTY RESIDENTIAL AND COMMERCIAL SOLID WASTE COLLECTION

VEHICLES

Date of Release: August 8, 2003

Scheduled for Consideration: September 25-26, 2003

This report has been reviewed by the staff of the California Air Resources Board and

approved for publication. Approval does not signify that the contents necessarily reflect the

views and policies of the Air Resources Board, nor does mention of trade names or

commercial products constitute endorsement or recommendation for use.
State of California

California Environmental Protection Agency

AIR RESOURCES BOARD

PROPOSED DIESEL PARTICULATE MATTER CONTROL MEASURE FOR ON-ROAD

HEAVY-DUTY RESIDENTIAL AND COMMERCIAL SOLID WASTE COLLECTION

VEHICLES

Supplemental Staff Report

Prepared by Staff of the

Mobile Source Control Division, Heavy-Duty Diesel In-Use Strategies Branch

With Assistance from Staff in the Following Branches:

Planning & Technical Support Division, Mobile Source Analysis Branch

Research Division, Health & Exposure Assessment Branch

Research Division, Research & Economic Studies Branch

Stationary Source Division, Emissions Assessment Branch

August 8, 2003
1

TABLE OF CONTENTS

Executive Summary..............................................................................................3

III. Need for Reduction of Diesel Particulate Matter Emissions...........................4

E. Health Effects of Diesel Emissions and Benefits of Diesel Emissions

Reductions ........................................................................................................4

1. Diesel Exhaust........................................................................................4

2. Health Impacts of Exposure to Diesel PM ..............................................5

3. Health Impacts of Exposure to Diesel Exhaust.......................................6

4. Health Impacts of Exposure to Ozone ....................................................6

5. Health Benefits of Reductions of Diesel PM Emissions..........................7

a. Reduced Ambient PM Levels .................................................................7

b. Reduced Ambient Ozone Levels ............................................................9

VIII. Revised Economic Impact..........................................................................9

C. Revised Estimated Costs to Collection Vehicle Owners ..........................10

1. Implementation Scenarios ....................................................................10

2. Revised Implementation Costs.............................................................13

D. Revised Potential Impact on Small Businesses .......................................14

I. Revised Potential Costs to Local and State Agencies..............................17

J. Revised Cost to the Average Household Receiving Waste Collection

Service ............................................................................................................17

IX. Revised Environmental Impacts and Cost-Effectiveness.............................18

A. Revised Benefits ......................................................................................18

1. Revised Statewide Benefits..................................................................18

2. Impacts on the State Implementation Plan for PM10 .............................20

3. Revised Cost-Effectiveness of Proposed Regulation ...........................21

XII. References to This Supplemental Staff Report ........................................22

 TABLE OF TABLES

Table 14Implementation Scenario (Current).......................................................11

Table 15Implementation Scenario (Potential 1) - No Level 2 Verified. ...............12

Table 16Implementation Scenario (Potential 2) – All Levels Verified. ................13

Table 17Average Capital Costs for Diesel Emission Control Strategies.............14

Table 20Estimated Average Cost to a Small or Large Collection Vehicle Owner

Based on the Average of Three Implementation Scenarios................................16

Table 21Total Estimated Statewide Cost for Local Government Agencies Based

on the Average of Three Implementation Scenarios...........................................17

Table 22Statewide Diesel PM Emission Reduction Benefits. .............................18

Table 23Other Pollutant Potential Reductions from Diesel Emission Control

Strategies............................................................................................................19

Table 24Statewide Diesel Carbon Monoxide Emission Reduction Benefits. ......19

Table 25Statewide Diesel Hydrocarbon Emission Reduction Benefits...............20

Table 26Statewide Diesel Oxides of Nitrogen Emission Reduction Benefits......20
2

APPENDICES

APPENDIX E: REVISED SOLID WASTE COLLECTION VEHICLE

EMISSIONS INVENTORY

APPENDIX F: REVISED COST-EFFECTIVENESS METHODOLOGY
3

EXECUTIVE SUMMARY

The Air Resources Board (ARB or “the Board”) issued the Staff Report: Initial

Statement of Reasons for the Proposed Diesel Particulate Matter Control

Measure for On-Road Heavy-Duty Residential and Commercial Solid Waste

Collection Vehicles on June 6, 2003. Subsequent to the publication of that

report, the ARB determined errors existed in the calculations underlying the

determination of cost-effectiveness. Staff decided the best interests of the public

would be served through reissuing the economic impacts and benefits and

restating the cost-effectiveness of the rule. In addition, Appendix E, the solid

waste collection vehicle emissions inventory, and F, the cost-effectiveness

methodology, are also reissued. In this document, tables are assigned the same

numbers as in the Staff Report issued on June 6, 2003.

In the Staff Report, we estimated that cancer risk from diesel particulate matter

(PM) would be reduced by a factor of ten in the highest exposure areas as a

result of this rule. For this supplemental staff report, staff has analyzed the effect

of diesel PM emissions reductions on premature deaths. ARB estimates that

eighty premature deaths will be reduced by year 2020. Prior to 2020,

cumulatively, it is estimated that three deaths would be avoided by 2006, thirtysix deaths avoided by 2010, and sixty-six by 2015.

The estimated present value of cost of control per premature death prevented, or

life saved, is $900,000 based on attributing half of the cost of controls to reduce

diesel PM. Compared to the present value of $4.2 million to $5.9 million using

U.S. EPA’s value of avoiding one death, this rule is a very cost-effective

mechanism of preventing premature deaths caused by diesel PM.

The Staff Report calculated costs over a seven year period, from 2004 through

2010. For that timeframe, the revised costs associated with carrying out this

proposed control measure will be about $63 million in 2002 dollars. For the

supplemental staff report, staff carried out costs (and benefits) through 2020.

The estimated cost for that time period is $154 million in 2002 dollars.

With the corrected estimate of emission reductions, this measure will reduce

diesel particulate matter emissions by 0.28 to 0.38 tons per day (tpd) of

particulate matter (PM) in 2010. This translates to as much as 84 percent

reduction from the 2000 PM inventory baseline expected by 2010 and 92 percent

reduction from the 2000 PM inventory baseline by 2020 of diesel PM from the

solid waste collection vehicle fleet. The best available control technologies

(BACT) associated with the proposed regulation are expected to reduce other

pollutant emissions, including ozone precursors, as well. Between 1.30 and 1.45

tpd of hydrocarbons (HC), 3.33 and 4.29 tpd of carbon monoxide (CO) and 3.1

and 6.5 tpd of oxides of nitrogen (NOx) will be reduced as a result of this

regulation in 2010. From 2004 through 2020, staff estimates that approximately
4

2,260,000 lbs of diesel PM will be removed from California’s air as a result of this

proposed rule.

Using the corrected estimates of cost and emissions reduced, therefore, the

approximate cost effectiveness is now estimated to be $67 per pound ($/lb) of

particulate matter reduced for the 17 year period, if all of the costs of compliance

are allocated to diesel PM reduction. Since this rule will also result in significant

reductions in hydrocarbons and oxides of nitrogen emissions, staff allocated half

of the costs of compliance against these benefits, resulting in cost-effectiveness

values of $32/lb diesel PM and $1.79/lb of HC plus NOx reduced, again for the

17 year period.

Staff expects the costs of compliance will be passed on to the solid waste

collection customers. The cost per household, using the new values, is

estimated to be about $5 per household over seven years, or $12 per household

over 17 years. This translates into an additional cost per household for solid

waste collection of less than $1.00 per year over the 17-year implementation

period of this proposed rule.

Note that in the following text, only the revised sections and tables of the Staff

Report are included. Original section numbers are used. For Appendices E and

F, however, the entire text has been revised and reissued.

III. Need for Reduction of Diesel Particulate Matter Emissions

E. Health Effects of Diesel Emissions and Benefits of Diesel Emissions

Reductions

The following is a revision of section III.E., Health Effects of Diesel Particulate

Matter, in the Staff Report issued June 6, 2003, and should be substituted for

that section. This new section broadens the discussion beyond health effects of

diesel PM to the health effects of the pollutants emitted by diesel engines and the

health benefits of the emissions reductions that would result from the

promulgation of the proposed diesel PM control measure for on-road heavy-duty

solid waste collection vehicles. Health benefits would occur from diesel exhaust

particulate matter reductions as well as reductions of emissions of ozone

precursors, NOx and HC (or volatile organic compounds, VOC), and toxic air

contaminants in diesel exhaust.

1. Diesel Exhaust

Diesel exhaust is a complex mixture of inorganic and organic compounds in both

the vapor and particle phase. The composition of this mixture varies depending

on engine type, operating conditions, fuel, lubricating oil, and whether or not an

emission control system is present. A major component of diesel exhaust is
5

particulate matter, which typically consists of a carbon core with a coating of

organic carbon compounds, or as sulfuric acid and ash, sulfuric acid aerosols, or

sulfate particles associated with organic carbon (Kittlelson et al. 1999). Almost

all of the diesel particle mass is in the range of 10 microns or less in diameter

(PM10). Indeed, approximately 94 percent of the mass of these particles are less

than 2.5 microns in diameter. Because of their small size, the particles are

readily respirable and can effectively reach the lowest airways of the lung along

with the adsorbed compounds, many of which are known or suspected mutagens

and carcinogens (SRP 1998).

2. Health Impacts of Exposure to Diesel PM

The U.S. Environmental Protection Agency (U.S. EPA) discussed the

epidemiological and toxicological evidence of the health effects of ambient PM

and diesel PM in the regulatory impact analyses for on-road and nonroad diesel

engine emission standards (U.S. EPA 2000b, U.S. EPA 2003). The key health

effects categories associated with ambient particulate matter include premature

mortality, aggravation of respiratory and cardiovascular disease (as indicated by

increased hospital admissions and emergency room visits, school absences,

work loss days, and restricted activity days), aggravated asthma, acute

respiratory symptoms, including aggravated coughing and difficult or painful

breathing, chronic bronchitis, and decreased lung function that can be

experienced as shortness of breath.

Health impacts from exposure to the fine particulate matter (PM2.5) component of

diesel exhaust have been calculated for California, using concentration-response

equations from several epidemiologic studies (Lloyd & Cackette 2001). Both

mortality and morbidity effects could be associated with exposure to either direct

diesel PM2.5 or indirect diesel PM2.5, the latter of which arises from the conversion

of diesel NOx emissions to PM2.5 nitrates. In California, the average population

weighted exposure to directly emitted diesel PM2.5 is 1.8 μg/m3

. Long-term

exposure to ambient concentrations of diesel PM2.5 at this level is estimated to

have led to a range of about 2,000 to 2,500 premature deaths, statewide, for the

year 2000. Indirectly formed diesel PM2.5 from NOx emissions (at 0.81 μg/m3

concentration level) is also estimated to contribute to an additional 900

premature deaths. The mortality estimates may include some premature deaths

due to cancer, because the epidemiologic studies did not identify the cause of

death. Exposure to fine particulate matter, including diesel PM2.5 can also be

linked to a number of heart and lung diseases. For example, it was estimated

that statewide on average, 2500 hospital admissions for chronic obstructive

pulmonary disease, pneumonia, cardiovascular disease and asthma were

associated with exposure to direct diesel PM2.5. An additional 1,100 admissions

were linked to exposure to indirect diesel PM2.5.
6

3. Health Impacts of Exposure to Diesel Exhaust

In addition to its contribution to ambient PM levels and associated health

impacts, diesel exhaust is of specific concern because it poses a lung cancer

hazard for humans, as well as a hazard from noncancer respiratory effects such

as pulmonary inflammation (U.S. EPA 2003). More than 30 human

epidemiological studies have investigated the potential carcinogenicity of diesel

exhaust. On average, these studies found that long-term occupational

exposures to diesel exhaust were associated with a 40 percent increase in the

relative risk of lung cancer (Cal EPA 1998). There is limited specific information,

however, that addresses differing susceptibilities to the carcinogenicity of diesel

exhaust within the general human population and vulnerable subgroups, such as

infants, children, and people with preexisting health conditions. The carcinogenic

potential of diesel exhaust was also demonstrated in numerous genotoxic and

mutagenic studies on some of the organic compounds typically detected in diesel

exhaust (Cal EPA 1998).

Diesel PM was listed as a toxic air contaminant (TAC) in 1998 by the Board after

an extensive public review and evaluation of the scientific literature by the Office

of Environmental Health Hazard Assessment (OEHHA) (CARB 1998). Using the

cancer unit risk factor developed by OEHHA for the TAC program, ARB

estimated that for the year 2000, exposure to 1.8 μg/m3

 of diesel exhaust could

be associated with a health risk of 540 excess cancer cases per million people

exposed over a 70-year lifetime. This estimated risk is currently equivalent to

about 270 excess cases of cancer per year for the entire State, which is several

times higher than the risk from all other identified TACs combined.

Another highly significant health effect of diesel exhaust exposure is its apparent

ability to act as an adjuvant in allergic responses and possibly asthma (DiazSanchez et al. 1996, Takano et al. 1998, Diaz-Sanchez et al. 1999). However,

additional research is needed at diesel exhaust concentrations that more closely

approximate current ambient levels before the role of diesel exhaust exposure in

the increasing allergy and asthma rates is established.

4. Health Impacts of Exposure to Ozone

Ozone is formed by the reaction of VOCs and NOx in the atmosphere in the

presence of heat and sunlight. The highest levels of ozone are produced when

both VOC and NOx emissions are present in significant quantities on clear

summer days. Ozone is a powerful oxidant that can damage the respiratory

tract, causing inflammation and irritation, which can result in breathing difficulties.

Studies have shown qualitatively that there are impacts on public health and

welfare from ozone at moderate levels that do not exceed the California 1-hour

ozone standard. Short-term exposures to high ambient ozone concentrations

have been linked to increased hospital admissions and emergency visits for
7

respiratory problems (U.S. EPA 2000). Repeated exposure to ozone can make

people more susceptible to respiratory infection and lung inflammation and can

aggravate preexisting respiratory diseases, such as asthma. Prolonged (6 to 8

hours), repeated exposure to ozone can cause inflammation of the lung,

impairment of lung defense mechanisms, and possibly irreversible changes in

lung structure, which over time could lead to premature aging of the lungs and/or

chronic respiratory illnesses such as emphysema and chronic bronchitis.

The subgroups most susceptible to ozone health effects include individuals

exercising outdoors, children and people with preexisting lung disease such as

asthma, and chronic pulmonary lung disease. Children are more at risk from

ozone exposure because they typically are active outdoors, during the summer

when ozone levels are highest. Also, children are more at risk than adults from

ozone exposure because their respiratory systems are still developing. Adults

who are outdoors and moderately active during the summer months, such as

construction workers and other outdoor workers, also are among those most at

risk. These individuals, as well as people with respiratory illnesses such as

asthma, especially asthmatic children, can experience reduced lung function and

increased respiratory symptoms, such as chest pain and cough, when exposed

to relatively low ozone levels during prolonged periods of moderate exertion.

5. Health Benefits of Reductions of Diesel PM Emissions

This section examines the health benefits of reducing diesel PM emissions

differently than section III. F. Risk Assessment. The following analysis estimates

premature deaths prevented from reducing diesel PM and also the costs, or

savings, to society for each prevented premature death. In addition, a brief

discussion of the health benefits of reducing ozone precursors is included.

a. Reduced Ambient PM Levels

The emission reductions obtained from this regulation will result in lower ambient

PM levels and significant reductions of exposure to primary and secondary diesel

PM. Lower ambient PM levels and reduced exposure, in turn, mean reduction of

the prevalence of the diseases attributed to diesel PM, reduced incidences of

hospitalizations and prevention of premature deaths.

Primary Diesel PM. Lloyd and Cackette (2001) estimated that, based on the

Krewski et al. (2000) study1, diesel PM2.5 exposures at level of 1.8 μg/m3 resulted

 

1 Although there are two mortality estimates in the report by Lloyd and Cackette (2001) – one based on work by Pope et

al. (1995) and the other based on Krewski et al. (2000), we selected the estimate based on the Krewski’s work. For

Krewski et al., an independent team of scientific experts commissioned by the Health Effects Institute conducted an

extensive reexamination and reanalysis of the health effect data and studies, including Pope et al. The reanalysis

resulted in the relative risk being based on changes in mean levels of PM2.5, as opposed to the median levels from the

original Pope et al. study. The Krewski et al. reanalysis includes broader geographic areas than the original study (63

cities vs. 50 cities). Further, the U.S. EPA has been using Krewski’s study for its regulatory impact analyses since 2000.
8

in a mean estimate of 1,985 cases of premature deaths per year in California.

The diesel PM emissions corresponding to the direct diesel ambient populationweighted PM concentration of 1.8 μg/m3 is 28,000 tons per year (CARB 2000).

Based on this information, we estimate that reducing 14.11 tons of diesel PM

emissions would result in one fewer premature death (28,000 tons/1,985 deaths).

Comparing the PM2.5 emission before and after this regulation, the proposed

regulation is expected to reduce emissions by 2,260,000 lbs (or 1,130 tons) at

the end of year 2020, and therefore prevent an estimated eighty premature

deaths by year 2020. Prior to 2020, cumulatively, it is estimated that three

deaths would be avoided by 2006, thirty-six deaths avoided by 2010, and sixtysix by 2015.

If we multiply 14.11 tons of diesel PM emissions by the average present value of

cost-effectiveness of $32 per pound (or $64,000 per ton), the estimated cost of

control per premature death prevented is about $900,000 in 2002 dollars. The

U. S. EPA has established $6.3 million (in year 2000 dollars) for a 1990 income

level as the mean value of avoiding one death (U.S. EPA 2003). As real income

increases, the value of a life may rise. U.S. EPA further adjusted the $6.3 million

value to $8 million (in 2000 dollars) for a 2020 income level. Assuming that real

income grew at a constant rate from 1990 and will continue at the same rate to

2020, we adjusted the value of avoiding one death for the income growth. Since

the control cost is expressed in 2002 discounted value, accordingly, we

discounted values of avoiding a death in the future back to the year 2002. In

U.S. EPA’s guidance of social discounting, it recommends using both three and

seven percent discount rates (U.S. EPA, 2000a). Using these rates, and using

the annual avoided deaths as weights, the weighted value of reducing a

premature future death discounted back to year 2002 is $4.2 million at seven

percent discount rate, and $5.9 million at three percent. The cost per death

avoided because of this proposed regulation is 4.7 to 6.6 times lower than the

U.S. EPA’s benchmark for value of avoided death. This rule is, therefore, a costeffective mechanism to reduce premature deaths that would otherwise be caused

by diesel PM emissions without this regulation.

The benefits of reducing diesel emission based on a statewide average diesel

emission value, such as Lloyd and Cackette (2001), contain off-road emissions

from a number of categories that occur well away from population centers.

Waste collection trucks, and their diesel emissions, are more concentrated in

urban areas, thus a greater reduction of the emissions as a result of the

regulation are expected to occur in urban areas, as compared to rural areas.

Emission reductions are therefore likely to have greater benefits than those

estimated by Lloyd and Cackette (2001). Thus the proposed rule is likely more

cost-effective than the above estimate would suggest.

Secondary Diesel PM. Lloyd and Cackette (2001) also estimated that indirect

diesel PM2.5 exposures at level of 0.81 μg/m3 resulted in a mean estimate of 895

additional premature deaths per year in California, above those caused by
9

directly formed diesel PM. The NOx emissions level corresponding to the

indirect diesel ambient PM concentration of 0.81 μg/m3 is 1,641 tpd (598,965

tpy). Following the same approach as above, we estimate that reducing 669 tons

of NOx emissions would result in one fewer premature death (598,965 tons/895

deaths).

If we multiply 669 tons of NOx emissions by the average present value of costeffectiveness of $1.29/lb ($2,580 per ton) (see Section IX), the estimated cost of

control per premature death prevented is about $1.7 million. This value is again

lower than the U.S. EPA’s present value of a life by 2.5 to 3.5 times.

b. Reduced Ambient Ozone Levels

Emissions of NOx and VOC are precursors to the formation of ozone in the lower

atmosphere. Exhaust from heavy-duty vehicles contributes a substantial fraction

of ozone precursors in any metropolitan area. Therefore, reduction of heavy-duty

diesel vehicle emissions of NOx and VOCs would make a considerable

contribution to reducing exposures to ambient ozone. Controlling emissions of

ozone precursors would reduce the prevalence of the types of respiratory

problems associated with ozone exposure and would reduce hospital admissions

and emergency visits for respiratory problems.

VIII. Revised Economic Impact

After publishing the staff report on June 6, 2003, staff determined a formula error

existed in calculating the capital recovery factor (CRF) for best available control

technologies. In order to present a more accurate estimate of cost-effectiveness,

at the same time that staff revised the CRF, we also revised additional

assumptions associated with the costs of the proposed regulation. The changes

made are summarized below:

• The CRF was reported to be 0.07, with an interest rate of 0.07 and a five-year

lifetime for each control technology. The CRF should have been 0.24. For

the revised analysis, staff used a CRF of 0.14, corresponding to an interest

rate of 0.07 and a ten-year lifetime.

• In this analysis, because the lifetime for each control technology is ten years,

only one installation of a diesel particulate filter (DPF), diesel oxidation

catalyst (DOC) or engine repower is assumed.

• Net annual savings in fuel ($700) and maintenance ($200) costs of $900 for a

repowered engine is assumed in the revised analysis. Most of these savings

result from repowering from an old engine to a 1994 model year or newer

engine. The original analysis assumed no fuel and maintenance cost

savings.
10

• For Level 2 BACT, staff used the cost associated with PuriNOxTM. As staff

assumed there are no capital costs for this technology, no CRF was

applicable to this cost.

• All costs are now figured in 2002 dollars, not 2003 dollars, as per standard

economics analysis, because the year is not yet complete.

• Staff reduced the number of expected engine repowers to include only those

expected to be forced by the rule; the original scenarios included the costs of

a certain amount of “voluntary” repowers, or those performed by owners who

preferred to repower rather than installing a lower-cost diesel emission control

strategy (DECS).

C. Revised Estimated Costs to Collection Vehicle Owners

1. Implementation Scenarios

The scenarios used to calculate costs and benefits for this analysis are slightly

different from the original scenarios in that they assume a lower use of engine

repowering and higher use of DECSs (Tables 14 – 16), as discussed above.

Both scenario sets are valid. The set of scenarios presented here is based solely

of the impact of the regulation to force use of a certain technology. The

scenarios used on the original staff report placed more emphasis on “voluntary”

engine repowers, based on assumptions about owner behaviors.
11

Table 14 Implementation Scenario (Current).

Technology Option

(By Percent Phase-In)

Group Eng MY %BACT Implementation Date Level 1 Level 2 Level 3 Repower

10% 12/31/2004 2% 8%

25% 12/31/2005 7% 8%

50% 12/31/2006 17% 8% 1 1994-2002a

100% 12/31/2007 40% 5% 5%

10% 12/31/2004 10%

25% 12/31/2005 15%

50% 12/31/2006 25% 1 1991-1993b

100% 12/31/2007 45% 5%

10% 12/31/2004

25% 12/31/2005

50% 12/31/2006

100% 12/31/2007 50%

1 1988-1990c

Delay 12/31/2008 50%

25% 12/31/2007 22.5%

50% 12/31/2008 22.5%

75% 12/31/2009 22.5%

100% 12/31/2010 22.5%

2 1960-1987c

Delay 12/31/2011 10%

50% 12/31/2009 35.5% 14.5% 3 2003-2006d

100% 12/31/2010 35.5% 14.5%

Percent of California’s Collection Vehicle Fleet Total: 53% 0% 16% 31%

Notes:

a Only 29% of 1994-2002 Model Year (MY) engines were considered to use passive DPFs based

on verification data and the engine exhaust temperature study. The rest will apply a DOC or other

Level 1 DECS, except for a small percentage (5%) that will be required to repower because of no

verified technology unusual engines.

b All but 5% of 1991-1993 MY engines will apply Level 1 verified DECSs; the balance will

repower.

c No verified DECSs are currently available, thus under this scenario all vehicles will have to

repower.

d Both current Level 1 and 3 DECSs will be extended to 2003-2006 MY engines.
12

Table 15 Implementation Scenario (Potential 1) - No Level 2 Verified.

Technology Option

(By Percent Phase-In)

Group Eng MY %BACT Implementation Date Level 1 Level 2 Level 3 Repower

10% 12/31/2004 2% 8%

25% 12/31/2005 7% 8%

50% 12/31/2006 17% 8% 1 1994-2002a

100% 12/31/2007 40% 5% 5%

10% 12/31/2004 10%

25% 12/31/2005 15%

50% 12/31/2006 25%

1 1991-1993b

100% 12/31/2007 45% 5%

10% 12/31/2004 10%

25% 12/31/2005 15%

50% 12/31/2006 25%

1 1988-1990b

100% 12/31/2007 45% 5%

25% 12/31/2007 2.5% 22.5%

50% 12/31/2008 2.5% 22.5%

75% 12/31/2009 2.5% 22.5%

2 1960-1987c

100% 12/31/2010 2.5% 22.5%

50% 12/31/2009 21.5% 28.5% 3 2003-2006d

100% 12/31/2010 21.5% 28.5%

Percent of California’s Collection Vehicle Fleet Total: 66% 0% 21% 14%

Notes:

a Same assumptions as Current scenario.

b

 Level 1 verifications will be extended for 1988-1990 MY engines; a small percentage of engines

will be unable to use Level 1 DECS and will be forced to repower.

c

 Level 1 DECS verifications will be extended for 1960-1987 MY engines and will be applied to

the ten percent of vehicles that are owned by companies with less than 15 vehicles; the rest will

repower.

d

 A greater percentage (compared to the Current scenario) will have Level 3 verified DECS

available, and thus fewer will use Level 1 DECS.
13

Table 16 Implementation Scenario (Potential 2) – All Levels Verified.

Technology Option

(By Percent Phase-In)

Group Eng MY %BACT Implementation Date Level 1 Level 2 Level 3 Repower

10% 12/31/2004 2% 8%

25% 12/31/2005 7% 8%

50% 12/31/2006 17% 8%

1 1994-2002 a

100% 12/31/2007 40% 5% 5%

10% 12/31/2004 10%

25% 12/31/2005 15%

50% 12/31/2006 25%

1 1991-1993 b

100% 12/31/2007 45% 5%

10% 12/31/2004 2% 8%

25% 12/31/2005 2% 13%

50% 12/31/2006 2% 23%

1 1988-1990 c

100% 12/31/2007 2% 43% 5%

25% 12/31/2007 2% 0.5% 22.5%

50% 12/31/2008 2% 0.5% 22.5%

75% 12/31/2009 2% 0.5% 22.5%

2 1960-1987 d

100% 12/31/2010 2% 0.5% 22.5%

50% 12/31/2009 21.5% 28.5% 3 2003-2006 e

100% 12/31/2010 21.5% 28.5%

Percent of California’s Collection Vehicle Fleet Total: 2% 64% 21% 14%

Notes:

a Assumes that Level 2 DECS are used in all vehicles that cannot use Level 3, except for small

percentage that repower.

b Assumes no Level 3, and Level 2 DECS are used in all vehicles, except for small percentage

that repower.

c Assumes that all vehicles use Level 2 DECS, except for small percentage that either use Level 1

or repower.

d Assumes only two percent will use Level 2 DECS; the rest will use Level 1 or repower. e Moves the group that used Level 1 DECS in the previous scenario into Level 2 DECS.

2. Revised Implementation Costs

Capital costs per vehicle and technology for various DECS options are listed in

Table 17. The total costs for passive and active diesel particulate filters have

increased slightly because of a slightly higher assumed cost of the engine

backpressure monitor.
14

Table 17 Average Capital Costs for Diesel Emission Control Strategies.

Average Cost ($)

Cost Description

Passive Diesel

Particulate Filter a, b

Active Diesel

Particulate Filter e,f

Diesel Oxidation

Catalyst g,h,I,j

Device $3,980 $10,500 $2,830

Installation c, d $290 $290 $290

Engine Backpressure

Monitor k

$1,100 $1,100 $0

Total Cost: $5,360 $11,890 $3,120

Note: Costs and how they are derived are described in detail in Appendix F.

a

MECA, November 2000, Study of DECS costs. 100-500 hp for varying production costs. b

 U.S. EPA, May 2000, Draft RIA. Cost in 2007, pg. V-9.

c

U.S. EPA, May 2000, Draft RIA. Includes trap cost, labor, warranty and muffler removal savings. d

ARB, June 2001. Installation cost for a muffler through phone conversations with Cummins,

Golden State Ford Truck Sales, Caterpillar, and Performance Truck and Diesel.

e

ARB, 2002. Cost to ARB demonstration program (device plus regeneration unit)

f

 ARB, October 2001. Cost quoted to ARB at Oct. 2001 meeting with active diesel particulate

filters providers from Europe

g

MECA, March 2000. Emission Control Retrofit of Diesel-Fueled Vehicles.

h

Clean Air Counts, 2002.

i

Fuelstar, 2000.

j

Parsons, February 2001.

k

Cost given at September 4-5, 2001 workshop by MECA members.

The estimated cost to repower an engine to meet a 0.01 g/bhp-hr PM emission

standard (2007 or later MY) has not changed from the Staff Report. Staff did,

however, quantify two benefits that offset the initial cost of repowering an engine,

increased fuel economy and decreased maintenance costs. The staff analysis

determined than an average annual savings of $900 was representative of the

benefit of repowering to a new engine.

D. Revised Potential Impact on Small Businesses

Using the revised values discussed above, staff recalculated the average cost for

a small fleet of ten vehicles, which is a typical size fleet of collection vehicles in

California. Staff assumed 80 percent of the vehicles would fall under Group 1

(MY 1988 – 2002), and 20 percent of the vehicles would fall under Group 2 (MY

1960 – 1987) implementation phase-in. For comparison, staff also calculated the

average cost for a large fleet of 100 collection vehicles. For the large company

staff assumed 80 percent of the vehicles would fall under Group 1, and 20

percent under Group 3 (MY 2003 – 2006) implementation phase-in, because

larger companies are assumed to only keep vehicles for five to ten years. As

described in the cost effectiveness methodology (Appendix F), in order to

translate the capital costs into annualized capital costs, staff used the cost
15

recovery factor of 0.14.2 Including both annualized capital, such as the DECS,

and Operations and Maintenance (O & M) costs and savings, the average total

estimated costs for a large and small private company to implement this

regulation between fiscal years 2004 and 20203 are $761,000 and $178,000,

respectively (Table 20). The cost analysis accounts for variability found in

implementing a full range of BACT as discussed and is based on an average of

the current, potential 1, and potential 2 implementation scenarios (Tables 14 –

16). Note that much of the increased costs to implement, relative to the original

Staff Report, are to be found in the additional years, 2011 through 2020, included

in this revised analysis.

 

2

 Capital recovery factor is r(1+r)^N/[(1+r)^N-1] (Linsley, 1977), where r = 0.07 discount rate, and

N = 10 years.

3

 Assumes costs paid for during the year leading up to December 31st implementation.
16

Table 20 Estimated Average Cost to a Small or Large Collection Vehicle

Owner Based on the Average of Three Implementation Scenarios.

Fleet

Type

Number of

Vehicles

Retrofit

Calendar

Year

Discounted

Annual Capital

Costs a

Average

Annual O&M

Costs b

Total

Average

Annual Cost

Small

Varies 2004 $0 $1,601 $1,601

Varies 2005 $362 $3,405 $3,767

Varies 2006 $677 $4,312 $4,988

Varies 2007 $9,596 $4,367 $13,963

Varies 2008 $12,134 $3,682 $15,816

Varies 2009 $15,779 $2,880 $18,659

Varies 2010 $17,512 $2,343 $19,855

- 2011 $16,366 $2,189 $18,556

- 2012 $15,296 $2,046 $17,342

- 2013 $14,295 $1,912 $16,207

- 2014 $13,360 $973 $14,333

- 2015 $12,302 $117 $12,419

- 2016 $11,325 -$631 $10,694

- 2017 $6,027 -$761 $5,266

- 2018 $4,024 -$508 $3,516

- 2019 $1,504 -$190 $1,314

- 2020 $0 $0 $0

10 Total: $150,559 $27,737 $178,296

Large

Varies 2004 $4,676 $5,809 $10,485

Varies 2005 $9,705 $14,949 $24,654

Varies 2006 $15,861 $19,710 $35,571

Varies 2007 $44,077 $38,758 $82,834

Varies 2008 $41,193 $36,222 $77,415

Varies 2009 $41,818 $37,358 $79,176

Varies 2010 $42,184 $38,190 $80,374

- 2011 $39,424 $35,692 $75,116

- 2012 $36,845 $33,357 $70,202

- 2013 $34,435 $31,175 $65,609

- 2014 $29,805 $27,602 $57,407

- 2015 $25,143 $22,757 $47,900

- 2016 $20,046 $15,428 $35,474

- 2017 $3,864 $4,081 $7,944

- 2018 $3,611 $3,814 $7,424

- 2019 $1,687 $1,782 $3,469

- 2020 $0 $0 $0

100 Total $394,374 $366,682 $761,056 a

 Derived from capital costs using A = (Net Present Value)*(Capital Recovery Factor of 0.07). b

 Discounted average annual O&M costs for fiscal years 2004 and 2005, include incremental fuel

and fuel transportation costs for those vehicle using DECS requiring low sulfur diesel fuel.
17

I. Revised Potential Costs to Local and State Agencies

As with the above analysis, staff recalculated the costs to public agencies

statewide that contract with or own solid waste collection fleets. The total

estimated statewide cost for local government agencies with solid waste

collection fleets would be an average total cost of about $9,300,000 (Table 21)

from 2004 to 2020 for the three implementation scenarios based on current,

potential 1, and potential 2 verification scenarios (Tables 14 – 16).

Table 21 Total Estimated Statewide Cost for Local Government Agencies

Based on the Average of Three Implementation Scenarios.

Calendar Year Discounted Annual

Capital Costs a

Average Annual

O&M Costs b

Total Average

Annual Cost

2004 $56,951 $70,752 $127,703

2005 $118,210 $182,081 $300,291

2006 $193,192 $240,065 $433,258

2007 $536,857 $472,067 $1,008,924

2008 $501,736 $441,184 $942,919

2009 $509,340 $455,019 $964,359

2010 $513,801 $465,156 $978,958

2011 $480,188 $434,726 $914,914

2012 $448,774 $406,286 $855,060

2013 $419,415 $379,706 $799,121

2014 $363,026 $336,188 $699,214

2015 $306,241 $277,186 $583,427

2016 $244,158 $187,916 $432,075

2017 $47,059 $49,701 $96,760

2018 $43,980 $46,450 $90,430

2019 $20,551 $21,706 $42,257

2020 $0 $0 $0

TOTAL $4,803,479 $4,466,189 $9,269,668

J. Revised Cost to the Average Household Receiving Waste Collection

Service

Municipalities, or collection vehicle owners directly, are expected to pass through

the cost to implement the proposed regulation to ratepayers. Staff derived the

annual expected increased cost of solid waste collection services per household

by dividing the total statewide dollar costs that businesses and individuals may

incur from this proposed regulation over its lifetime, about $154 million, by the

number of estimated households in California, or 12,335,400 households as of

2005 (Center for Continuing Study of the California Economy 2001). The total
18

revised cost per household in California, over the implementation period of fiscal

years 2004 to 2020, would therefore be approximately $12, or $0.70 annually.

This estimated cost per household includes residential and commercial solid

waste and recycling services.

IX. Revised Environmental Impacts and Cost-Effectiveness

The proposed regulation would provide significant cost-effective diesel PM

emission reductions throughout California, especially at the neighborhood level.

The air quality benefits statewide would be not only from reduction of diesel PM

emissions, but also from reduction of NOx, HC, and CO emissions as well.

Following the publication of the Staff Report on June 6, 2003, staff determined

that there was an error in the method used to calculate the survival rate, or

turnover, of solid waste collection vehicles. Vehicles were previously assumed to

last longer in the population than staff now believes is realistic. The increased

turnover rate used in recalculating emission benefits results in lower emission

benefits than previously assumed.

A. Revised Benefits

1. Revised Statewide Benefits

Using the revised vehicle turnover rate, ARB staff now estimates that the

proposed diesel PM control measure would result in the reduction of between

0.28 and 0.38 tpd of diesel PM emissions in 2010 and between 0.07 and 0.09 tpd

diesel PM reduced in 2020 (Table 22). The reduction of diesel PM emissions

attributed to this regulation peaks around 2010 because all collection vehicles

are expected to meet the diesel PM control measure by 2010. After 2010 the

benefits attributed to this regulation decline to between 0.07 and 0.09 tpd in 2020

as vehicles are retired and replaced with new engines that meet the federal 2007

0.01 g/bhp-hr PM standard. From 2004 through 2020, staff estimates that

approximately 2,260,000 lbs., or 1,130 tons, of diesel PM will be removed from

California’s air as a result of this proposed rule.

Table 22 Statewide Diesel PM Emission Reduction Benefits.

Diesel PM Reduction (tpd) Calendar

Year

Baseline

Inventory

(tpd) Current Potential 1 Potential 2

2005 0.94 0.03 0.04 0.06

2010 0.56 0.38 0.28 0.36

2015 0.31 0.17 0.13 0.18

2020 0.17 0.07 0.07 0.09
19

Other air quality benefits also exist as a result of the use of the various BACT,

including reduced emissions of CO, HC, and NOx. The reductions in HC are also

accounted for in the State Implementation Plan. Based on expected reduction

capabilities from the various DECS that might be used (Table 23), reductions of

up to 4.29 tons of CO per day (Table 24), up to 1.45 tons of HC per day (Table

25), and 6.5 tons of NOx per day (Table 26) are predicted.

Table 23 Other Pollutant Potential Reductions from Diesel Emission

Control Strategies.

Emission Reduction (Percent)

Diesel Emission Control Strategy PM CO HC NOx

Passive Diesel Particulate Filter 85a 90b 95b 0c

Fuel-Water Emulsionh 50a 35d 60d 15

Average Diesel Oxidation Catalyst 25a 47e, f 76e, f 0c

a

Verified Level Reduction Goals for ARB. Strategies will not be verified without meeting this

standard at a minimum.

b

Allansson, R, et al. 2001, European Experience of High Mileage Durability of Continuously

Regenerating Diesel Particulate Filter Technology. SAE. 2001-01-0480. c

Majewski, W. Addy, 2001, Diesel Net Technology Guide: Diesel Particulate Traps.

www.dieselnet.com. d

Diesel Net Technology Guide: Emission Control Technologies, 1998. www.dieselnet.com. e

Diesel Net Technology Guide: Diesel Oxidation Catalyst, 1999. www.dieselnet.com. f

Khair, Magdi; McKinnon, Dale L. Performance Evaluation of Advanced Emission Control

Technologies for Diesel Heavy-Duty Engines. SAE. 1999-01-3564.

h

Fuel-water emulsion increases CO and HC emissions. Although can be verified alone for the

purposes of simplifying calculations, assumed it would be used in conjunction with a diesel

oxidation catalyst to decrease impact of increase. Choose least decrease to account for offset of

increase from fuel-water emulsion.

Table 24 Statewide Diesel Carbon Monoxide Emission Reduction Benefits.

Diesel CO Reduction (tpd) Calendar

Year

Baseline

Inventory

(tpd) Current Potential 1 Potential 2

2005 8.95 0.41 0.64 0.51

2010 6.02 4.29 4.07 3.33

2015 3.79 2.31 2.24 1.78

2020 2.57 1.20 1.24 1.01
20

Table 25 Statewide Diesel Hydrocarbon Emission Reduction Benefits.

Diesel HC Reduction (tpd) Calendar

Year

Baseline

Inventory

(tpd) Current Potential 1 Potential 2

2005 2.93 0.15 0.24 0.22

2010 1.76 1.45 1.42 1.30

2015 0.95 0.72 0.70 0.62

2020 0.54 0.34 0.34 0.30

Table 26 Statewide Diesel Oxides of Nitrogen Emission Reduction

Benefits.

Diesel NOx Reduction (tpd) Calendar

Year

Baseline

Inventory

(tpd) Current Potential 1 Potential 2

2005 27.0 0 0 0.4

2010 20.9 6.5 3.1 5.1

2015 14.1 2.3 1.1 2.5

2020 7.99 0.6 0.3 1.0

2. Impacts on the State Implementation Plan for PM10

The anticipated benefits of this proposed rule are included in the draft State

Implementation Plan (SIP) for PM10 in the San Joaquin Valley. That plan was

adopted in June 2003, with attainment of the federal PM10 standard projected by

2010. As a “serious” nonattainment area, the San Joaquin Valley must use best

available control measures for all sources of PM10 in its district and must also

achieve five percent annual emission reductions in PM10 and its precursors. The

San Joaquin Valley has seven percent of the statewide solid waste collection

vehicles and will see a benefit of up to 0.03 tpd of PM reduced by 2010. In

addition, the NOx and volatile organic carbon (VOC) benefits of the proposed

rule are contained in the plan, as they are precursors to secondary PM formation.

The South Coast air basin is also classified as a “serious” nonattainment area for

PM10 but its attainment deadline is 2006, before most of the benefits of the

proposed rule will be achieved. Nonetheless, the proposed rule will help that

District maintain compliance with the federal PM10 standard. The rule also

serves as a down payment on future plans to achieve the federal PM2.5

standards and California’s own, more stringent standards. Thirty-five percent of

California’s solid waste collection vehicles are in the South Coast region. By
21

2010, the proposed rule will reduce emissions from those vehicles by up to 0.13

tpd.

All other PM10 nonattainment areas in California will benefit from the proposed

rule in a general way. Every district, except Lake County, is nonattainment for

the California PM10 standard. In addition, four other areas in California are

nonattainment for the federal PM10 standards: Owens Valley, Searles Valley,

Coachella Valley, and Imperial Valley.

For ozone SIPs there is a similar situation. The South Coast and San Joaquin

Valley have new federal ozone plans under development, with adoption

tentatively scheduled for September 2003 and December 2003, respectively.

Both districts have an attainment deadline of 2010 for the federal one-hour ozone

standard. The overall NOx and VOC benefits of ARB’s planned diesel in-use PM

reduction rules are contained in the draft South Coast ozone plan and will be

included in the San Joaquin Valley ozone plan once it is released for public

review. The Sacramento Metropolitan region is considering an ozone plan

update and would include ARB’s diesel in-use PM reduction control measures if

its attainment deadline ultimately shifts from 2005 to 2010.

As with PM10, all other ozone nonattainment areas in California will benefit from

the proposed rule in a general way as it reduces the precursors to ozone

formation (see Tables 25 and 26).

3. Revised Cost-Effectiveness of Proposed Regulation

The estimated average cost-effectiveness of this proposed diesel PM emission

reduction regulation, considering only the benefits of reducing diesel PM, is

approximately $67/lb of PM reduced annually from fiscal years 2004 to 2020.

This rule will also result in significant emission reductions of HC and NOx,

however, thus it is valid to allocate half of the cost of compliance to the benefits

of HC and NOx reduction. The cost-effectiveness for reducing HC and NOx,

which are ozone precursors and contributors to secondary PM formation, is

$1.79/lb of HC plus NOx. Since NOx emissions account for, on average, 72

percent of the total HC and NOx emissions, the cost-effectiveness of NOx and

HC would be approximately 1.29/lb of NOx and 0.50/lb of HC, respectively. The

cost-effectiveness of PM reduction is $32/lb, when half of the cost of compliance

is allocated to HC and NOx reduction in this way. The costs and emission

reductions associated with this regulation and how they were derived are

discussed in further detail in Appendix F.

As discussed earlier in section III.E.5.a., this rule is also estimated to cost

$900,000 per premature death prevented, or life saved. Staff estimates that, on

average, the reduction in diesel PM emissions because of this rule will result in

the prevention of eighty premature deaths by year 2020. Compared to present

value of the U.S. EPA’s value of avoiding one death at $4.2 million to $5.9
22

million, this rule is a very cost-effective mechanism of preventing premature

deaths caused by diesel PM.

XII. References to This Supplemental Staff Report

California Air Resources Board. Resolution 98–35: Identification of Particulate

Emissions from Diesel-Fueled Engines as a Toxic Air Contaminant; California

Air Resources Board: Sacramento, CA, 1998,

http://www.arb.ca.gov/regact/diesltac/res98-35.pdf.

California Air Resources Board. Risk Reduction Plan to Reduce PM Emissions

from Diesel-Fueled Engines and Vehicles, Sacramento, CA, October 2000.

California Environmental Protection Agency. Proposed Identification of Diesel

Exhaust as a Toxic Air Contaminant: Health Risk Assessment for Diesel

Exhaust; Appendix III, Part B; Office of Environmental Health Hazard

Assessment: Sacramento, CA, 1998.

Diaz-Sanchez, D.; Tsien, A.; Casillas, A.; Dotson, A.R.; Saxon, A. Enhanced

Nasal Cytokine Production in Human Beings after in vivo Challenge with

Diesel Exhaust Particles; J. Allergy Clin. Immunol. 1996, 98, 114-123.

Diaz-Sanchez, D.; Garcia, M.P.; Wang, M.; Jyrala, M.; Saxon, A. Nasal

Challenge with Diesel Exhaust Particles Can Induce Sensitization to a

Neoallergen in the Human Mucosa; J. Allergy Clin. Immunol. 1999, 104,

1183-1188.

Kittelson, D.B.; Arnold, M.; Watts, W.F. (1999) Review of Diesel Particulate

Matter Sampling Methods. Final Report. University of Minnesota

www.me.umn.edu/centers/cdr/Proj_EPA.html.

Krewski D.; Burnett R.; Goldberg M.; Hoover K.; Stemiatychi J.; Jerrett M.;

Abrahamovicz M.; White W. Reanalysis of the Harvard Six Cities Study and

the American Cancer Society Study of Particulate Air Pollution and Mortality.

Health Effects Institute, Cambridge MA. 2000.

Lloyd, A.C.; Cackette, T.A. Diesel Engines: Environmental Impact and Control; J

Air Waste Manage. Assoc. 2001, 51: 809-847.

Pope C.A.; Thun M.J.; Namboodiri M.M.; Dockery D.W.; Evans J.S.; Speizer

F.E.; Heath C.W. Particulate Air Pollution as a Predictor of Mortality in

Prospective Study of U.S. Adults. Am. J. Respir. Crit. Care Med. 1995,

151:669-674.

Scientific Review Panel. Report to the Air Resources Board on the Proposed

Identification of Diesel Exhaust as a Toxic Air Contaminant. Part A.
23

Exposure Assessment. As Approved by the Scientific Review Panel on April

22, 1998.

Takano, H.; Ichinose, T.; Miyabara, Y.; Shibuya, T.; Lim, H.B.; Yoshikawa, T.;

Sagai, M. Inhalation of Diesel Exhaust Enhances Allergen-related Eosinophil

Recruitment and Airway Hyperresponsiveness in Mice; Toxicol. Appl.

Pharmacol. 1998, 150, 328-337.

United States Environmental Protection Agency, 2000a, Guidelines for Preparing

Economic Analyses. September 2000.

United States Environmental Protection Agency, 2000b, Assessment and

Standards Division, Office of Transportation and Air Quality. Regulatory

Impact Analysis: Heavy-Duty Engine and Vehicle Standards and Highway

Diesel Fuel Sulfur Control Requirements. EPA420-R-00-026, December

2000.

United States Environmental Protection Agency, Assessment and Standards

Division, Office of Transportation and Air Quality, Draft Regulatory Impact

Analysis: Control of Emissions of Air Pollution from Nonroad Diesel Engines

and Fuel. EPA420-R-03-008, April 2003.