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7 ENVIRONMENTAL PROTECTION AGENCY

8 Office of Transportation and Air Quality

9 Compliance and Innovative Strategies Division

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14 PUBLIC HEARING

15 CLEAN ALTERNATIVE FUEL VEHICLES AND ENGINE CONVERSIONS

16 June 23, 2010

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22 REPORTED BY: ANN ARBOR REPORTING SERVICE, INC.

2551 Jade Court

23 Ann Arbor, MI 48103

(734) 330-5472

24

Jacqueline D. Duchene, CSR-4182

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11 MS. COHEN: Good morning. My name is Janet

2 Cohen. I'm Deputy Director of the Compliance and

3 Innovative Strategies Division within EPA's Office of

4 Transportation and Air Quality.

5 On behalf of the Environmental Protection

6 Agency and the Office of Transportation and Air Quality,

7 I would like to welcome you to this public hearing on

8 our proposed rule for clean alternative fuel vehicle and

9 engine conversions. A Federal Register notice appeared

10 on May 26th, 2010, at Volume 75, Federal Register,

11 page 29606 announcing an opportunity for public hearing

12 and comment on this proposed rule.

13 I will be the presiding officer for today's

14 hearing. On the panel with me are Kristien Knapp, an

15 environmental protection specialist within the

16 Compliance and Innovative Strategies, and Martin

17 Reineman, an engineer within the Compliance and

18 Innovative Strategies Division. Mark Kataoka, an

19 attorney with EPA's Office of General Counsel, may be

20 joining us later.

21 The purpose of today's hearing is to take

22 testimony on EPA's proposed rule for clean alternative

23 fuel vehicle and engine conversions. The proposal would

24 amend the regulatory procedures of 40 CFR part 85

25 subpart F and part 86 to simplify and streamline the

21 process by which manufacturers of clean alternative fuel

2 conversion systems may demonstrate compliance with

3 vehicle and engine emission requirements.

4 Specifically, the new program would establish

5 new testing and compliance options based on the age of

6 the vehicle or engine being converted; one, conversions

7 of vehicles or engines that are new and relatively new;

8 two, conversions of vehicles or engines that are no

9 longer new but still fall within EPA's definition of

10 full useful life. We refer to that category as

11 intermediate age. And, three, conversions of vehicles

12 or engines that are outside EPA's definition of useful

13 life.

14 As set forth in the proposal published in the

15 Federal Register, we seek testimony and comments on all

16 aspects of the proposed rule. We are also requesting

17 comments on a variety of specific issues, including the

18 compliance pack for vehicles outside their useful life.

19 We are particularly interested in receiving input on the

20 outside useful life compliance options presented in the

21 proposal.

22 Now I would like to briefly describe how we

23 will proceed today to hear your testimony. We are

24 conducting this hearing in accordance with Section 307

25 (b) 5 of the Clean Air Act as amended, which requires

31 EPA to provide interested persons with an opportunity

2 for oral presentation in addition to written

3 submissions. The official record of this rulemaking

4 will be kept open for 30 days after we conclude today's

5 hearing so that any interested person may submit

6 rebuttal and supplemental information. Today's hearing

7 will be conducted informally and the formal Rules of

8 Evidence do not apply.

9 As presiding officer I am authorized to strike

10 from the record any statements which I deem are

11 irrelevant or needlessly repetitious and to enforce

12 reasonable limits on the duration of any witness's

13 statement. We ask that presenters keep their remarks

14 brief so everyone has a chance to speak. We have

15 received requests to present oral testimony from Elio

16 Muller, Diesel 2 Gas, Inc., John Reed, Omnitek

17 Engineering, Pete Peterson, Omnitek Engineering,

18 Bob Natkin, American Power Group, Chris Disher, Flex

19 Fuel U.S., LLC, Jeffrey L. Clark, NGV America,

20 Giedrius Ambrozaitis, Alliance of Automobile

21 Manufacturers, and John Webster, Natgascar Company. We

22 will hear from them in that order.

23 A list of speakers is available at the

24 reception table, along with a copy of each person's

25 testimony if they have prepared copies for public

41 distribution.

2 Any member of the audience who wishes to

3 testify may still sign up at the reception table. We

4 will try to accommodate everyone who wants to testify.

5 We ask that everyone attending today's hearing sign in

6 at the reception table whether or not you are

7 testifying. Witnesses should state their name and

8 affiliation prior to making their statement. Witnesses

9 are reminded that any false statements or false

10 responses to questions may be a violation of law. When

11 each witness has finished their presentations, the EPA

12 panel will have an opportunity to ask clarifying

13 questions related to the testimony. EPA does not intend

14 to engage speakers in dialogue or respond to questions

15 from the audience.

16 We are having this hearing recorded and the

17 transcript will be available for public inspection in

18 EPA's Air Radiation Docket at docket number

19 EPA-HQ-OAR-2009-0299. The transcript will also be

20 available for public access on the regulations dot gov

21 website under that same docket number. Anyone

22 wishing -- wishing to purchase a copy of the transcript

23 may do so directly from the court reporter. Those

24 interested should make individual arrangements with the

25 court reporter.

51 In addition to today's hearing, there is also

2 an opportunity to send us written comments. The comment

3 period for this rule closes on July 23rd, 2010. We will

4 determine the schedule for final action on this proposal

5 after the comment period closes.

6 Thank you. I would like to mention that Mark

7 has now joined us. And with that I call the first

8 witness.

9 MR. MULLER: I just go to the podium?

10 MS. COHEN: Yes, please.

11 MR. MULLER: Good morning. My name is Elio

12 Muller. I am president and CEO of Diesel Gas,

13 Incorporated, and Director of Strategic Projects for

14 Gaseous Fuel Systems Corporation. Both are related

15 clean alternative fuel conversion companies based in

16 Tampa and Fort Lauderdale, Florida.

17 We appreciate this opportunity to provide oral

18 comments at this early stage in the rulemaking process.

19 EPA's effort to simplify and streamline the alternative

20 fuel conversion demonstration and approval process is

21 critical to the success of our business of converting

22 on-road vehicles and engines to operate on clean natural

23 gas to improve our nation's energy security and provide

24 substantial emission reductions.

25 Gaseous Fuel Systems, GFS Corporation,

61 manufactures and sells equipment that enables existing

2 diesel engines to operate on both diesel and natural gas

3 in a bi-fuel mode. The company offers a full line of

4 retrofit conversion systems covering a broad spectrum of

5 diesel engines made by all major manufacturers. GFS is

6 also the Florida master distributor of the GTI-Altronic

7 line of the same bi-fuel conversion technology for

8 stationary applications.

9 Diesel to Gas, D2G, is the exclusive US

10 on-road distributor for the GFS bi-fuel fumigation

11 technology that inexpensively converts diesel engines,

12 enabling them to safely operate in 50 to 80 percent

13 natural gas. The technology has been widely used for

14 more than 15 years converting thousands of engines.

15 More recently GFS has been converting vehicles in

16 Latin America and Asia.

17 A key feature is the ability to switch fuel

18 modes from 100 percent diesel to bi-fuel and back

19 without interruption of the vehicle operation. The GFS

20 system is compatible with compressed natural gas,

21 liquified natural gas, as well as bio-methane.

22 The GFS technology is an intake air fumigation

23 system. It introduces natural gas into the engine

24 intake air at atmospheric pressure upstream of the

25 engine. The fumigation is accomplished by using a

71 patented mixer installed in the air induction pipe

2 upstream of the turbocharger. And we brought one here

3 with us today.

4 The GFS system electronically intercepts the

5 pedal position signal upstream of the engine's

6 electronic controller to simulate the pedal position

7 signal to supply the correct diesel fuel rate to

8 supplement the gas and fuel rate. Therefore, GFS -- the

9 GFS system does not physically touch the engine or the

10 engine electronic control system, nor does it bypass,

11 defeat, or render inoperative any device or element of

12 design installed on the engine.

13 Also the GFS system does not affect the

14 durability of the OEM engine or emission control system.

15 And fuel evaporative emissions are not generated since

16 it is a closed system and natural gas is introduced into

17 the engine at atmospheric pressure.

18 Clearly the GFS system is within the class of

19 systems contemplated by EPA on page 27 of the proposed

20 rule change where it states, and I quote, certain

21 demonstration requirements could potentially be waived

22 for clean alternative fuel conversions if the conversion

23 manufacturer has not altered the OEM configuration of

24 the vehicle or engine when operating on its original

25 fuel.

81 Let me pause here and state that we -- we have

2 a system where you could just turn off the gas and that

3 engine could go to 100 percent diesel and it's going to

4 do it automatically. The driver's not even going to

5 know what happened. We have a system that by just

6 turning off the gas EPA will be able to take that engine

7 and take it into confirmatory testing without doing

8 anything, without taking anything off of it that we put

9 on it. It will absolutely operate as it was designed

10 and manufactured to do on the original 100 percent

11 diesel fuel.

12 Until recently the U.S. focus of GFS has been

13 on converting generator sets. Publix Supermarkets is

14 the largest user of the technology in the U.S with more

15 than 650 of its backup generators. Our proven patented

16 technology is unique and it's capable of even converting

17 existing engines without tampering and with -- without

18 tampering with any of the components at a low cost while

19 maintaining original engine performance. We are now

20 reintroducing our product for vehicle conversions in the

21 United States. To date we have successfully installed

22 over 3,000 stationary GFS systems and over 800 units on

23 vehicles.

24 And I'll pause again to state that -- that

25 this technology was originally developed for on road and

91 at one time there were hundreds of vehicles in the

2 United States before the current regulations came in.

3 We -- our technology also is one that we --

4 because of the way we're fumigating into the airstream

5 we haven't found a diesel engine we cannot convert. And

6 we've been able to successfully convert every one we've

7 attempted. We've reviewed the more than 225 EPA

8 certified heavy-duty diesel engines. And we think that

9 we have a very general application that could go into

10 this existing fleet at the -- at the intermediate age

11 and outside useful life vehicles.

12 We are encouraged that EPA's proposal

13 recognizes that it is appropriate to treat after-market

14 conversion differently than new vehicle and engine

15 certification with regard to age, test group criteria,

16 and the need for testing. We also appreciate and

17 support several steps that EPA has taken in the proposed

18 rule that would greatly simplify the process.

19 However, as a practical matter, the rule would

20 require the use of certification procedures in too many

21 cases. Several key modifications to the proposed rule

22 are needed to address business issues and facilitate

23 alternative fuel field conversions. Without these

24 modifications we believe that the intermediate age and

25 older alternative fuel conversions will continue to be

101 severely limited and the potential criteria pollutant

2 emissions and greenhouse gas emission and energy

3 security benefits of these conversions to vehicles in

4 the existing fleet will not be realized.

5 EPA has requested comments on several options

6 for compliance demonstration of outside useful life

7 vehicles. We believe Option 1 is the appropriate for

8 these vehicles. It requires a detailed statement that

9 the conversion technology -- technology is technically

10 sound and is applied according to principles of good

11 engineering judgment. Option 2 requires emission

12 testing of a worst case vehicle or engine before and

13 after application of the alternative fuel technology.

14 Option 3 is the same as Option 1 with on-board

15 diagnose -- on-board diagnostic scan report to

16 demonstrate proper function.

17 A significant portion of our business is

18 likely to be intermediate age category vehicles where

19 emissions data vehicle certification procedures would be

20 required for demonstration of compliance. We believe

21 that -- we believe that even the proposed alternative

22 test group definition, emissions data vehicle procedures

23 including selection, mileage accumulation and testing,

24 are far too cumbersome and unnecessary to demonstrate

25 the emissions performance of the already certified

111 vehicle or engine as maintained. Instead, before and

2 after testing of intermediate age vehicles as described

3 in Option 2 for outside useful life vehicle would be

4 adequate to demonstrate that emissions performance of

5 OEM vehicles was maintained and that the alternative

6 fuel conversion did not cause emissions to increase.

7 For large volume manufacturers, rather than a

8 certification style durability -- durable -- vehicle

9 demonstration, the durability of the aftermarket

10 conversion equipment could be independently demonstrated

11 by field or laboratory testing.

12 We expect our business will also involve the

13 conversion of heavy duty diesel vehicles that were

14 originally engine certified. The proposed rule could be

15 interpreted to require the removal of engines from

16 vehicles to conduct certification styled emissions data

17 engine demonstration. It would be unnecessarily

18 difficult and expensive to remove and reinstall entire

19 engines, particularly for systems that do not alter the

20 OEM configuration of the engine when operating on its

21 original fuel, when before and after testing on complete

22 vehicles would be adequate to demonstrate that emissions

23 were not adversely affected by the alternative fuel

24 conversion.

25 We understand that our before and after

121 testing recommendations on a complete vehicle that was

2 originally engine certified would not demonstrate

3 compliance of the OEM engine with the applicable

4 standards. Before and after testing would only

5 demonstrate whether emissions were affected by the

6 alternative fuel conversion. However, the OEM is

7 responsible for in-use compliance administered

8 separately by EPA.

9 We believe that the responsibility of the

10 alternative fuel conversion manufacturer should be

11 limited to demonstrating that the alternative fuel

12 conversion does not cause the emissions performance to

13 deteriorate. As a result, we believe that before and

14 after testing on complete vehicle that was engine

15 certified would comprise an adequate demonstration of

16 compliance on an intermediate age vehicle. Again, this

17 is particularly true in the case of GFS technology where

18 it does not alter the OEM configuration of the engine

19 when operating on its original fuel.

20 Also, we believe expanding the definition of

21 small volume manufacturers would help to facilitate the

22 growth of alternative fuel conversion and take advantage

23 of potential emissions benefits it offers. In the rule

24 preamble, EPA stated that the purpose of the rule was to

25 simplify and streamline the clean alternative fuel

131 conversion process. The preamble goes on to say that it

2 would do so to alleviate some of the economic and

3 procedural impediments to clean alternative fuel

4 conversions while maintaining environmental safeguards

5 to ensure that applicable emissions levels from

6 converted vehicles are sustained. We assume this

7 includes facilitating clean alternative fuel conversion

8 in order to realize the full potential of environmental

9 advantages of clean alternative fuels.

10 We believe that the small volume manufacturer

11 limits for certification purposes do not necessarily

12 have to be applied to intermediate age and outside

13 useful life vehicles. We -- we recommend that the small

14 volume manufacturer provisions could be at least

15 expanded to larger volume manufacturers, perhaps up to

16 50,000 units per year without compromising emissions

17 performance.

18 We believe our recommendations especially as

19 they apply to heavy duty intermediate age vehicles would

20 accomplish EPA's objectives of streamlining and

21 simplifying the alternative fuel conversion compliance

22 demonstration process on a more practical basis while

23 reducing criteria pollutants and greenhouse gas

24 emissions and improving energy security.

25 I want to add a note to the -- the prepared

141 documents to say what we see this market to be for a

2 technology like ours that can actually go into just

3 about any existing fleet and convert it to a bi-fuel

4 system. You do that on -- on a vehicle without taking

5 the engine out because we're not exchanging any parts.

6 As you can see, we're -- we're doing very unintrusive

7 actions to the vehicle itself. That means that we could

8 go into a fleet and offer this across the board

9 regardless of how many engines they have in that fleet.

10 And the reality of the market out there is that you're

11 not going to find homogenous engine fleets operating.

12 You're going to find fleets that have a variety of

13 engines and engine styles in their fleet.

14 These fleets in order to financially or

15 economically justify a conversion and to justify the --

16 the logistical culture of fueling with a new fuel as

17 cumbersome as CNG or LNG is not going to do this by

18 converting a very small percentage of their fleets. And

19 that has been part of the challenge of the few products

20 that are offered in the market that can hopefully

21 penetrate a small part of -- of a fleet or do it

22 gradually over time. It makes it almost impossible to

23 have these captive fleets, make the investment in the

24 fueling infrastructure if they can't take on a

25 conversion of their entire fleet.

151 So what we find in the market is we may find a

2 fleet that has 200 plus vehicles and that's what's going

3 to justify putting a CNG plant or a fast fill overnight.

4 That's what's going to justify putting an LNG storage

5 facility. But in order to economically make that work

6 they're going to have to be able to convert their entire

7 fleet. We happen to have a technology that can do that

8 very inexpensively that can justify the investment on

9 older vehicles. But if we have to -- if that process

10 gets bogged down by 225 heavy duty diesel engines that

11 are certified by the EPA, having to pull engines and --

12 and take them into test cells and -- and -- and make

13 this too cumbersome, it makes it almost impossible to

14 penetrate this market and to deploy these technologies

15 in the way that is required and envisioned by what your

16 objective stated in your proposed rule change of

17 streamlining and simplifying and financially being

18 pragmatic.

19 We -- we appreciate your objectives here and

20 we've been -- we've been waiting for them for -- for --

21 for over 15 years, but I just want to underscore what

22 this market looks like in reality as you go through

23 finalizing your rule change, realizing what we find

24 when -- when we come out there. We -- we understand

25 that there are some -- that -- that -- that you

161 currently lack some heavy duty above 15,000 pound

2 protocols for vehicle testing. You know, we'd be glad,

3 and I think a lot of the other manufacturers would be

4 glad, to work with EPA to work out a protocol that makes

5 this work.

6 We currently use vehicle chassis dynamometers

7 to install our systems. We -- we -- we go into the test

8 cell with the vehicle to properly calibrate how these --

9 these conversion systems are going to operate and we

10 have our own protocol. Of course, you have to develop

11 your own that's going to be uniform for all of the

12 products and manufacturers. But my -- my -- my

13 sincerest hope, as I congratulate EPA for taking these

14 steps, is that you keep a very pragmatic eye on

15 fulfilling what your objectives are in simplifying and

16 streamlining and alleviating the economic and procedural

17 impediments, as well as all of the technical ones.

18 Thank you very much for your attention.

19 MS. COHEN: Thank you. I would ask you if you

20 have any data or technical specifications on the test

21 procedures that we might use to implement your

22 suggestion of before and after testing instead of engine

23 testing, if you could submit those with your comments?

24 MR. MULLER: We would be glad to do that.

25 MS. COHEN: And then I did have another

171 question. You mentioned 800 vehicles having been

2 converted. Were those U.S. vehicles?

3 MR. MULLER: Some of those were prememorandum

4 1A vehicles from the '90s, and at one point the

5 technology had CARB certification of one engine.

6 MS. COHEN: Uh-huh.

7 MR. MULLER: And then -- and then the

8 remainder have been in Latin America and Asia since.

9 MS. COHEN: Thank you. Are there any other

10 questions from the panel?

11 MR. REINEMAN: I would -- I was going to

12 reiterate what you said, Janet, with the desire to

13 provide any specific information or ideas you have about

14 alternative chassis test procedures that would apply to

15 implementing the vehicles. Also, if you have any data

16 from that type of testing we would like to see the

17 emission improvements if you have such that show what

18 happened before and after testing.

19 And then on the second page of your

20 presentation, it looks like the fourth paragraph, you

21 were talking about durability of the aftermarket

22 conversion equipment. If you have more information

23 about what you're thinking about there with respect to

24 an alternative durability demonstration, that would be

25 good to put into writing for us as well.

181 MR. MULLER: Perfect.

2 MR. REINEMAN: Otherwise I think your --

3 you've covered it, which was the general request for

4 test data and information about the test procedure.

5 MR. MULLER: Thank you very much for your

6 attention today.

7 MS. COHEN: Thank you. Mr. Reed.

8 MR. REED: Good morning.

9 MS. COHEN: Good morning.

10 MR. REED: Well, my name is Dr. John Reed.

11 I'm formerly with Omnitek Engineering, currently the

12 Regulatory Affairs Director for Core Power. I'm here

13 with Pete Peterson, also formerly of Omnitek. Pete's

14 and I at our tenure at Omnitek were in part of the team

15 that got one of the only two engines that are a 2010

16 CARB EPA certified for heavy duty natural gas

17 applications, so I think our experience in this process

18 is something that we can hopefully give some -- give

19 some insight to.

20 And I really appreciate the opportunity to do

21 this and appreciate the EPA coming through with the

22 proposed regulation showing that they're very much

23 listening to America and listening to manufacturers out

24 there and really actually trying to make this work and I

25 really appreciate that.

191 I'll try not to read this too much, but we

2 will see how it goes.

3 All right. So currently the proposed rules

4 would allow two types of natural gas heavy duty vehicles

5 to exist, those that are EPA certified and have a

6 documented low emissions profile, and those that are EPA

7 allowed and have little or no documentation of

8 emissions.

9 Currently, heavy duty diesel vehicle owners

10 have few choices when it comes to switching to a cleaner

11 fuel and breaking our country's dependence on foreign

12 oil. They have choice of replacing the entire vehicles

13 with very high priced, new EPA certified heavy duty

14 natural gas vehicles, of which there are very few, or if

15 they are fortunate enough to own vehicles that can use

16 one of these two engines they can repower with these

17 selected vehicles. This is a capital intensive process

18 and the available certified engines and vehicle types

19 make up a tiny fraction of the diesel powered heavy duty

20 engines in vehicles in use today. Therefore fleet

21 owners that wish to move to natural gas as their fuel of

22 choice have very little opportunity to do so at this

23 time. Even if everyone that could did convert today the

24 total number would be quite small.

25 Under the proposed rules owners would also --

201 could also convert their existing in-use vehicles with

2 EPA approved kits that would allow them to run on

3 natural gas but which could possibly be creating more

4 greenhouse gases than the original diesel engine in the

5 form of unburned methane, which is 24 times more potent

6 than greenhouse gas than CO2, if low quality kits were

7 installed. Quality conversion systems could also be

8 available which would allow most heavy duty engines on

9 the road today to meet or be cleaner than the 2004 to

10 '07 CARB on-road heavy duty engine emission standard.

11 Wow, say that fast. Okay.

12 Unfortunately, the proposed rules would not

13 allow consumers to differentiate these products through

14 EPA labeling, and clean conversions would be on the same

15 footing as low quality conversions in the eye of the

16 public and the EPA. What the proposed rules will not

17 create is the option of installing a quality conversion

18 product that meets a defined low emission standard and

19 involves the use of existing in use engines and

20 vehicles. What diesel fleet owners won't have is the

21 option of installing an EPA certified product that has

22 all of the warranty protections provided under the

23 Clean Air Act, yet is affordable and works in their

24 existing vehicle.

25 The cost differential between converting an

211 existing in-use engine and purchasing new EPA certified

2 heavy duty natural gas products is enormous, as new 2010

3 heavy duty CNG CARB/EPA certified vehicle and engines

4 demand an exorbitant premium. This is a major barrier

5 to adoption of natural gas as the fuel of choice for

6 heavy duty applications. A fleet owner could convert

7 several in-use engines with a quality conversion product

8 for the price of a single new heavy duty CNG engine,

9 assuming the size and type of certified CNG engine that

10 they need even exists.

11 Many large fleet owners regularly schedule

12 engine rebuilds at predetermined levels. In fact,

13 diesel engine rebuilds annually outpace new diesel

14 engine purchases by over ten to one. If a quality

15 conversion is done at the time of the scheduled rebuild,

16 the incremental cost of converting to natural gas is a

17 fraction of the cost of a new certified engine.

18 In this way large fleet owners could rapidly

19 convert their entire fleet over a period of a few years

20 without needing a major inflow of capital, but without a

21 certification process that allows in-use conversions to

22 meet an obtainable emission standard fleet owners have

23 no assurance that they are making the right decision in

24 converting. If a quality conversion was available which

25 has been EPA certified to a realistically obtainable

221 emission standard, the end user would be assured that

2 the conversion product has been evaluated in a manner

3 similar to a new CNG engine and is of sound engineering.

4 Cheap, low quality conversion kits are

5 currently being sold outside of the U.S. and these kits

6 will undoubtedly be marketed in the U.S. once the

7 proposed rules are in place as currently stated.

8 The experience in foreign markets for us has

9 shown that these low priced low quality kits while of

10 seemingly sound engineering have led to a large number

11 of catastrophic engine failures. And they have slowed

12 the adoption of CNG, essentially giving the conversion

13 business a bad name in these countries.

14 Although the proposed rules would mandate the

15 suppliers warranty their goods the same as OEM or new

16 engine producers, our experience in other countries has

17 shown these kits -- these types of rules have offered

18 little protection to the end user. Most of the low

19 quality kits we encountered were cursory copies of OEM

20 systems or other quality manufacturers in terms of

21 general design and types of parts used but were not the

22 same. Much of the technology used in heavy duty natural

23 gas conversions is not patented or patentable but is

24 proprietary in nature and not obvious on visual

25 inspection. I am doubtful that EPA will be able to

231 determine the quality of an HD engine conversion system

2 by reviewing drawings in a single exhaust test. When

3 these low quality systems began to fail, the sellers

4 simply left the country, leaving no promises of warranty

5 protection behind.

6 I see no way for EPA to prevent this type of

7 activity without putting up barriers to entry in this

8 market that would also negatively affect honest, small

9 volume manufacturers. The alternative is to create a

10 certification pathway for producers that are willing to

11 demonstrate to EPA satisfaction that their products can

12 perform well and consistently meet a low emission

13 standard, but a standard that takes into account the use

14 of a used engine.

15 EPA needs to have a pathway to certification

16 for conversion products that is separate from being

17 defined as new and being required to meet new model year

18 standards. Emission standards for all types of engines

19 are created four years prior to enforcement to allow

20 major OEMs sufficient lead time to develop technology to

21 meet these standards. Multi-millions of dollars are

22 spent by each of these large multi-nationals to try and

23 meet these standards. The makers of conversion products

24 do not have that type of budget to work with, and to

25 expect them to meet the new standards with their

241 products is unrealistic. But to completely eliminate

2 the need for conversions to meet a low emission standard

3 is not the way to increase adoption rates of natural gas

4 heavy duty engine technology.

5 The CARB 2010 heavy duty CNG on road emisson

6 standard has become the Holy Grail, and the technology

7 has yet to arrive for the majority of engine types and

8 sizes to meet this standard. Several HD diesel OEMs and

9 one major multi-national industrial company have tried

10 and failed to meet the standard for CNG fueled engines,

11 and some have publicly pulled out of the CNG HD market

12 altogether. This has left consumers with few options,

13 but with the disaster in the Gulf, the political

14 pressure to go green, the very real need to participate

15 in our country becoming energy independent, the pressure

16 for heavy duty diesel owners to use natural gas for fuel

17 has never been greater. These consumers need an option

18 that is available, affordable, certified clean and

19 provides all the warranty protection promised by the

20 Clean Air Act.

21 EPA recognizes that used motors are not as

22 clean as new and much work has been done to incorporate

23 the engine emission deterioration rates into within

24 useful life conversion emissions goals in the proposed

25 rules. It would seem logical to then require that

251 certified conversions of in use heavy duty diesel

2 engines to natural gas meet an emission standard in

3 force prior to the current model year standard, such as

4 the CARB of 2004 to '07 on road standard for immediate

5 and past useful life categories of HD engines. A

6 conversion product certified to this standard is

7 attainable for many engine families, especially large

8 displacement motors, and can fulfill Clean Air Act

9 warranty protections no matter what the age or mileage.

10 Even if you do not believe this to be true, the

11 administrator has the authority to make this pathway

12 available and to allow manufacturers the opportunity to

13 prove you wrong.

14 The administrator is authorized under the

15 Clean Air Act section 7521 (a)1 and 2 to set emission

16 standards for heavy duty engines and to look at the

17 effect of engine rebuilding practices in the 7521 (a) 3

18 and (D). EPA has also granted CARB a waiver to set

19 retroactive emission standards for heavy duty engines

20 both on and off road for engines of all ages and

21 mileage. Many in this industry anticipate EPA will

22 adopt similar retroactive standards in the near future.

23 Why not create a certification process for these older

24 engines to meet lower emission standards via natural gas

25 conversion prior to mandating these engines meet a new

261 clean air standard.

2 California heavy duty fleet owners right now

3 are spending sums nearly equal to the complete cost of

4 converting a CNG -- to CNG just to install a Diesel

5 Particulate Filter, an item which actually increases

6 greenhouse gas production, fuel consumption and

7 operating costs through decreased engine efficiency and

8 the need to burn out these filters periodically.

9 Wouldn't it make more sense to allow those fleets to

10 convert to natural gas to eliminate particulate matter

11 pollution while decreasing greenhouse gas emissions and

12 getting our country off its dependence on oil imports?

13 All of this could be accomplished if a pathway

14 to certification existed that allowed in use

15 intermediate and past useful life HD vehicles to be

16 certified to the CARB on road 2004 to '07 emission

17 standard. I am asking the administrator to seriously

18 consider adding this option to the proposed new rules

19 and give consumers the ability to join the effort to get

20 America off its dependence on oil for transportation

21 fuel while protecting and improving our air.

22 MS. COHEN: Thank you.

23 MR. REED: All right.

24 MS. COHEN: Any questions?

25 MR. REINEMAN: I had a few. It would be

271 useful if you would submit some written comments for

2 some of the things that you said here. For example, I

3 think for our purposes we would like to know more about

4 what you see as the low quality kit versus a certified

5 product?

6 MR. REED: Sure. Well, obviously those don't

7 exist yet in the U.S. because of the rules, but there

8 are kits that come out of Korea that we've had to

9 compete against in Thailand that, you know, many engines

10 failed and fleets decided not to go with CNG that were

11 originally going to go with our product because it was

12 $10, $20, $50 cheaper they went with the Korean kit and

13 it failed. And that business went away.

14 MR. REINEMAN: Okay. I think we're interested

15 in describing the technology that constitutes the low

16 quality versus --

17 MR. REED: Sure.

18 MR. REINEMAN: -- high quality, so if you

19 could describe that to us I think that would be useful.

20 MR. REED: Okay. Actually, I have one other

21 comment I haven't put it. It's not in the written

22 thing. One of the things I did put in the docket on the

23 website was the CARB, Addendum A, which is their rules

24 currently in force for meeting certification for an

25 alternative fuel conversion. And in many ways it's very

281 similar to what you were asking for the intermediate

2 life engines. The difference is it would actually get

3 certified through CARB. And you don't have to do an

4 emission test prior, all you have to do is use the

5 standard that the engine was certified to when it was

6 new as your baseline. So you don't have to do a

7 baseline on the engine first. You can, that's one way

8 to do it. There's multiple ways in the CARB addendum.

9 But if you simply take the baseline that the

10 old engine was at as a diesel engine, do your conversion

11 and then do the test, you actually have a 1.1 times

12 factor. So it's not like it's more than 10 percent

13 dirtier. You can get CARB certification.

14 My understanding is that if we got a CARB

15 certification on one of these conversions that EPA would

16 recognize that. So it seems like there's a little bit

17 of a conflict there in what you're proposing when it's

18 already being enforced in California. Granted, those

19 rules in California were written in 1995 or passed in

20 1994, so they are antiquated, but they're on the books

21 and that's what we could do if we wanted to.

22 MS. COHEN: Have you already submitted the

23 comments?

24 MR. REED: Yes.

25 MS. COHEN: Okay. Well, if you would like to

291 include additional comments, please feel free to --

2 MR. REED: Sure.

3 MS. COHEN: -- add that --

4 MR. REED: Okay.

5 MS. COHEN: -- and submit it to us.

6 MR. REED: All right.

7 MR. REINEMAN: And then again any information

8 or ideas that you have concerning alternative

9 certification protocol for heavy duty engines versus the

10 current engine certification process we use, such as

11 chassis testing concept, if you have experience or

12 knowledge or ideas about that, we would like to see

13 that.

14 MR. REED: Okay.

15 MS. COHEN: Thank you.

16 MR. REED: All right. Thank you.

17 MS. COHEN: Mr. Peterson.

18 MR. PETERSON: Good morning, Everyone. My

19 name is Pete Peterson and I'm the VP of Engineering with

20 Core Power, and really I'm just providing a minor

21 addendum to what Dr. Reed has said.

22 In bringing systems to much of Asia,

23 South America, the problems that we've encountered with

24 low quality systems really have been in many cases

25 ruined the market and just slowed the -- the progression

301 of conversion down to a point where it -- it hurts

2 everybody. And we find that there is a critical set of

3 features that a system should have in order to function

4 well and durably and in this marketplace.

5 You know, the -- the problems we found is that

6 when a system's installed by basically a totally

7 unqualified vender the first thing people do is they

8 start to tamper with it to get more power out of the

9 engine, of course, and it throws off your ability to

10 control and it results in blown engines or engines that

11 are just terrible with emissions.

12 And so tamper proof, tamper resistant type of

13 features are critical on these engines. If you set one

14 up on a dyno and somebody can simply loosen a locknut

15 and change one screw a quarter of a turn, you have no

16 idea where the emissions are on that vehicle out in the

17 field. They're completely changed. And so that as a --

18 as a baseline is a critical feature.

19 The -- the durability in terms of the emission

20 stability really requires the use of on-board

21 diagnostics. The system should have on-board

22 diagnostics for at least all the critical sensors that

23 are used on the engine so that you could tell if the

24 sensors are operating in their normal range, if they're

25 out of the range, or if they've shorted ground or open.

311 Those type of features we find are critical.

2 Also, basic diagnostics for all critical

3 actuators, so if you have fuel injectors, if you have

4 fuel modulating control valves, any -- any item on the

5 engine that can affect the air fuel ratio spark timing,

6 for example, those systems should have diagnostics to

7 tell and to signify the driver with a check engine light

8 that they're working within normal parameters. It's

9 also helpful if the systems have data reporting

10 features, such as engine abuse statistics.

11 Because without engine abuse statistics,

12 again, the driver always want ten, fifteen more power.

13 And they will go out and try -- try and tweak these

14 systems. Modern systems with adaptive controls can

15 easily monitor boost pressures, several features within

16 the engine control parameters that pretty much

17 characterize what the power level of the engine is.

18 Systems that we produce all have torque estimation

19 routines built into them so we know what torque the

20 engine is producing at any given time. And these

21 features basically prevent anyone from going out and

22 changing the torque curve of an engine. So even if they

23 do tamper, our system will adjust back in. But with

24 those type of systems in place basically you have a --

25 an inherently stable emissions control system.

321 And we've found that in almost any market with

2 varying fuel quality, with many variations in the -- in

3 the input system we obtain consistent low emissions over

4 the life of the vehicle. We have a very high catalytic

5 efficiency. And that's in A -- you know, for Thailand,

6 we have systems in Myanmar, at this point we have

7 systems in China, and we see great results with this

8 type of technology feature set in place.

9 Regarding Martin's questions on the low

10 quality kits, that's -- the systems that we have found

11 out there, and we will respond in writing to your

12 questions, but basically those systems they have never

13 been used in any type of system that had to go --

14 undergo emissions testing, and we feel that that's a

15 critical part of this whole process. And so as John was

16 saying having some level of emissions level is critical.

17 With conversion of heavy duty engines we feel

18 that a great option is to go of -- of a lean burn,

19 because basically you achieve the highest efficiency on

20 a dedicated natural gas engine with a lean burn -- or

21 with lean burn combustion.

22 And so for the beyond useful life engines the

23 2004 emissions level of 2.4 grams per NOx plus

24 hydrocarbons is a useful number because those engines

25 can be converted to burn -- lean burn. And hence

331 they're going to have the lowest greenhouse gas

2 signature and the highest efficiency available for a

3 dedicated engine.

4 For the newer, beyond the -- for intermediate,

5 the 2007 standard, basically the family emissions limits

6 under the 2007 allow emissions levels of 1.2 to 1.5

7 grams NOx. We feel that that's a more aggressive

8 target. That's probably beyond the range of the lean

9 burn engines. And yet it is I think a good target for

10 those intermediate engines.

11 Natural gas is an amazing fuel, and we need to

12 take advantage of that for high performance and low

13 emissions. And it can all be done. And the 2007, the

14 main portion, calling out the .2 grams NOx, as opposed

15 to really the 2010 numbers, and they're achievable but

16 at a much higher cost, and I think that does prohibit

17 the adoption of natural gas at this point. And so what

18 I would recommend or what I see as the 2007 family

19 emissions limits as being sort of the -- the highest

20 level that I would go to on those intermediate engines

21 and then for new, of course, it's the 2010. And so

22 that's basically a summary of my comments on Dr. Reed's

23 speech.

24 MS. COHEN: Thank you. Mr. Natkin.

25 MR. NATKIN: Good morning. I'm Bob Natkin.

341 I'm the Chief Engine Engineer at American Power Group.

2 I'm here to quickly explain our comments and -- on the

3 proposed new ruling for alternative fuel conversion.

4 And in -- in the packet that you've received and in the

5 handout also and what's been -- been put into the

6 website we've -- we've put background information on the

7 APG technology because it's different from the typical

8 lengthy spark ignited engine conversion systems that EPA

9 probably has the most experience with. But I'm not

10 going to take the time to review it other than to let

11 you know that the information is there. It's specific

12 to compression ignition or diesel engines in the medium

13 duty and heavy duty vehicle. In EPA vernacular, it

14 would be called a bi-fuel or a flex fuel or a co-fuel

15 technology, which introduces natural gas and allows the

16 use of natural gas and diesel fuel simultaneously, so.

17 Let's see. Do I point it at you or -- there

18 we go. Okay. So then we'll go to the next slide.

19 And then -- this is the diagram of the system.

20 I'm not going to go through the schematic. You can go

21 look at it at your own convenience. It's not too much

22 different than what you've already seen with -- with a

23 few differences. It is a patented system. It's been

24 around for quite a few years.

25 And then the next page is features and

351 benefits, which again you can review at your own

2 convenience, but they're going to be similar to what

3 you've -- you've heard some -- from some of my

4 predecessors.

5 Okay. Let's move directly to comments.

6 And although there's a lot of words on this

7 page, I'm going to summarize it down pretty quickly.

8 Under the current regulations engines must be

9 tested, quote, unquote, in the same manner as the OEM's

10 original certification. We are asking under the

11 categories of intermediate and outside useful life to

12 include chassis roll emission testing and/or road

13 testing with Part 1065 compliant Portable Emission

14 Measurements Systems or PEMS.

15 We are also asking that testing be allowed to

16 be conducted in a back to back fashion to establish a

17 baseline with the OEM fuel system and a comparative test

18 with the upfitted system to show no degradation in the

19 exhaust emissions or engine or after treatment systems.

20 And these are easily done through test data both of

21 emissions, engine temperatures, and use of after

22 treatment system temperatures, which can easily be

23 measured.

24 Okay. Comment 2 is outside useful life

25 definition. There was some request for comments on

361 this. And APG contends that the primary wear and

2 degradation factors for engines and after treatment

3 systems is operational time and operational mileage in

4 properly maintained vehicles. And we would ask that

5 outside useful life definition be primarily associated

6 with vehicle milage and operational time as opposed to

7 mere age.

8 Okay. Comment 3. Under the proposed

9 regulation stating that the alternative fuel delivery

10 system would employ technology that is equivalent to the

11 OEM fuel delivery system, and while this might be

12 appropriate for spark ignited, stoichiometric engine

13 conversion systems, we believe it's unnecessarily

14 restrictive for compression ignition, lean operation

15 diesel bi-fuel delivery system. It's impractical and

16 unnecessary to add a set of natural gas de -- direct

17 injective -- injection injectors, fuel rails and

18 modifications to the engine for such systems. And we

19 can achieve virtually the same function by using a

20 digitally controlled fueling system with a proper

21 induction mixer or fumigator, as you've seen before.

22 We respectfully request that this section be

23 rewritten to allow mixed fuel delivery systems in the

24 case of an upfitted diesel bi-fuel application as long

25 as they can demonstrate no degradation in exhaust

371 emissions or engine or after treatment systems.

2 Okay. So moving to comment 4. APG agrees

3 with outside useful life Option 1 and understands that

4 you're going to need some emission data. Okay. You

5 just -- I've been -- I worked at a major OEM for

6 32 years. I put engines into production. You need

7 data. There's just -- I don't -- I just don't believe

8 that you can -- you can write up something and say, you

9 know, the physics say this. I think you're going to

10 need data.

11 So we are requesting, respectfully requesting,

12 that vehicles of 8,500 # GVW and higher that EPA approve

13 chassis roll testing and/or road testing using the

14 appropriate PEMS to allow said testing to be done in a

15 back to back fashion to establish baseline and compare

16 test data for diesel bi-fuel upfit systems.

17 Comment 5 is APG agrees with the outside

18 useful life Option 2 and again respectfully requests for

19 vehicles of 8,500 # GVW and higher that EPA approve

20 chassis roll testing and/or road testing also using --

21 and using -- using the appropriate devices be allowed.

22 Okay. Comment 6. APG agrees with the greater

23 flexibility and test group definition and asks for

24 clarification with regard to heavy duty diesel engines

25 which may be used in many OEM vehicle applications. If

381 an upfit bi -- bi-fuel system can be demonstrated to

2 have no degradation in emissions or jeopardy to the

3 engine or after treatment system in one vehicle

4 application via approved EPA chassis roll or road load

5 testing, APG would wish to seek approval for the upfit

6 system with the same engine, same emission systems, in

7 similar vehicle applications.

8 In other words, you're going to find Cummins

9 engines of specific size and -- and technology in

10 multiple class A tractors. What we're asking for is

11 that we -- if we demonstrate on one vehicle and then

12 we -- we achieve appropriate approval that we can carry

13 that over to possibly another OEM vehicle but, you know,

14 that utilizes the exact same engine after treatment

15 system and control system and so forth.

16 We, APG, also respectfully request that

17 similar approval across model years of OEM engines

18 control systems and emission technology be approved

19 if -- if it's shown that that technology is unchanged

20 across the model years. And obviously we are aiming

21 this towards intermediate and outside useful life

22 categories.

23 And then finally comment 7 is APG agrees with

24 a no certification no recertification requirements for

25 intermediate age and outside useful life categories.

391 MS. COHEN: Thank you. As you were -- I want

2 to speak to all the presenters. If you have any data

3 that you can provide to us that demonstrate what you've

4 been talking about, about no more recertification with

5 your -- your systems, that would be very, very helpful.

6 And any thoughts or information or data that you can

7 provide us specifically on the type of procedures you

8 would recommend.

9 MR. NATKIN: We're somewhat familiar with the

10 EPA test procedures for light duty, the chassis roll

11 testing. And I actually have been negotiating with

12 Washington about what would be suitable. And we would

13 like to work with EPA just to sort out suitable test

14 procedures and then go to suitable test facilities,

15 chassis roll facilities, because as you've heard, to

16 take a vehicle, strip the entire system, the engine

17 system, the control system, wiring harness, the after

18 treatment system, all that out, place it on a -- on an

19 approved dyno facility and then run your heavy duty

20 engine cycle is two to three times the cost of just

21 taking the entire vehicle for everything that's already

22 there and approved for the money in running your test.

23 So we would be desirous of negotiating with EPA to get

24 an approved set of EPA type tests on chassis roll that

25 would -- that EPA would be satisfied with, satisfied and

401 then do the back to back.

2 Basically you shut off the bi-fuel system, run

3 the base 100 percent diesel fuel, and then turn on the

4 bi-fuel system, run the same amount of -- the same

5 testing and compare the data. It's a little bit chicken

6 or egg. You're asking us for data. We're saying we

7 want to make sure that the data that we go after is

8 something that you're going to be happy with as the EPA.

9 So, and we're-- we're more than willing to negotiate and

10 discuss and sort out whatever testing.

11 We can do over-the-road testing with

12 a portable emission analyzer system, approved portable

13 emission analyzer system, but we need to make sure that

14 whatever testing we run you're going to say, okay, we're

15 happy with that. So we need further discussion on that.

16 MS. COHEN: Any other questions?

17 MR. REINEMAN: The only other thing I would

18 suggest is that if you have opinions about the

19 difference, if you will, between engine and chassis

20 testing options that exist now between 8,500 and 14,000

21 if you would express that in writing that would be

22 useful for us as well.

23 MR. NATKIN: We've put together a set of

24 suggestions and submitted them.

25 MR. REINEMAN: Okay.

411 MR. NATKIN: And then we're open to

2 suggestions coming back the other way. I mean, if you

3 want to see -- if what we submit is -- is not

4 necessarily everything that you want to see and you come

5 back and say, okay, we want to see steady state speeds

6 and loads of the following, we're happy to and open to

7 that kind of dialogue.

8 MR. REINEMAN: Okay.

9 MR. NATKIN: Thank you.

10 MS. COHEN: Mr. Disher.

11 MR. DISHER: Janet and members of the

12 administration, thank you so much for inviting us for

13 comment today.

14 My name's Chris Disher. I am one of the

15 co-founders of Flex Fuel U.S. With me is our other

16 co-founder Mitch, an inventor, Mitch Sremac in the room.

17 We are the developer and distributor of the Flex Box

18 Smart Kit, which is an E85 alternative fuel conversion.

19 So we allow a gasoline powered vehicle to operate just

20 as an OEM flex fuel vehicle kit would -- would operate.

21 Our mission is to focus solely on -- on

22 developing EPA certified kits. We don't produce or

23 market off route -- road technology. Our mission is to

24 focus on the fleet market, both public and -- and

25 private fleets. We are the only E85 converter that is

421 certified by the EPA today. There are other conversion

2 kits. Previous speakers mentioned illegal international

3 kits that are on the market today. We are -- we are

4 trying to enter a market that's got a very dirty way,

5 bad reputations as we get to our prospects and potential

6 customers. Because these kits do exist in we think

7 fairly large numbers within the United States, it's very

8 difficult for us to market something. And EPA

9 certification is -- is very important. It's important

10 that we develop their awareness that our products and

11 other products that might be like ours in the future

12 have that -- have passed that standard.

13 The suggestions and comments that we have were

14 gathered from not just our staff but experts in the

15 field that we work with in the development of our kit,

16 including Roush Laboratories. Our CEO is a chemical

17 engineer and former senior executive of British

18 Petroleum in the fuels refining and distribution

19 business. We regularly consult with former OEM

20 consultants from -- such as Ford and -- and also

21 Mercedes.

22 We also gathered relevant insights from

23 government agencies such as -- and independent test labs

24 such as Oak Ridge Laboratories, Renewable Fuels

25 Association. We spent time with the Department of

431 Transportation and General Service Administration in

2 understanding their needs and directions for

3 technologies like ours and its application to help with

4 executive orders that are improving the use of

5 alternative fuels.

6 So we offer these comments in the spirit of

7 helping our nation move forward in the alternative fuels

8 market.

9 Our understanding of the EPA proposed rules

10 for alternative fuels conversion is that EPA has had a

11 longstanding growing interest by the public in

12 aftermarket fuel conversion systems certainly since our

13 inception in 2006 as we observe the documentation from

14 the EPA and interest in getting more alternative fuel

15 certifications out there and having guidelines for

16 convertors. This opens up new fuel supply choices for

17 consumers. We think conversion market is important.

18 Consumers today if they want to use the fuel have to buy

19 an OEM produced vehicle or one of the ones that we have

20 that is certified. And in the market we see that while

21 there is a growing number of FFVs the challenge we have

22 is making sure that there is demand for the fuel so that

23 the fuel distribution -- distributers and retailers make

24 the fuel available for people that have these vehicles

25 and want to -- choose to use the fuel.

441 The -- obviously the interest in alternative

2 fuel is to reduce greenhouse gas emissions and foreign

3 oil independence, and we -- we support that. You are --

4 we sup -- we endorse your efforts to reduce the burden

5 on converters. It's important to us because our market

6 is quite small compared to the OEM production size.

7 Instead of tens of thousands of vehicles or hundreds of

8 thousands of vehicles in production we're talking about

9 thousands. And when you try to develop a conversion

10 product for each specific engine group, model family

11 year, that burden is significant enough that it -- it

12 does not make it economically viable to produce a large

13 number of vehicles for the growing retail market. So,

14 hence, we focus on the fleet market, which is a small

15 number of models that enable us to have a viable --

16 viable company. So -- so it -- it -- we think it's

17 important to move in this direction.

18 We -- I mentioned the importance of reducing

19 economic burden. The rules as we see them today do not

20 neatly fit our market. As I said, they're written for

21 OEMs, new vehicles, large production volumes. We're in

22 the thousands in terms of production. And we would like

23 to see that, while our market is to convert the used car

24 vehicles, that the tests that we have to meet are

25 consistent with those such as you've developed with the

451 intermediate age group for in -- you know, and for

2 in-use testing. That's important to us because as we

3 need to acquire used vehicles, such as the 2006 Crown

4 Victoria, we need to have something that we can bring

5 into the lab and test and we're required to bring that

6 vehicle up to new start -- new car standards. So as we

7 want to do more and more vehicles it becomes more and

8 more difficult to find vehicles that were -- are -- are

9 in new enough condition to pass the existing test.

10 In the aftermarket the ability to demonstrate

11 the conversion meets federally recognized standard

12 product. The intermediate age group that's being

13 proposed should be viewed as a legitimate and

14 appropriate, not viewed as inferior to conform --

15 confirmatory.

16 In order to ensure intermediate group

17 conversions are used, legitimate conversions, the EPA

18 should issue a waivered document, not just posting it on

19 the website. When we're in the market, as strange as it

20 might sound, almost any -- any prospect wants to know

21 about our EPA certification. We believe -- you know,

22 there's -- there's a heightened awareness about the need

23 to have that, and -- and we observe the illegal

24 convertors are -- that are at conferences and so forth

25 selling their kits and -- and misrepresenting what the

461 kits can do and misrepresenting what they have approved

2 or not approved from the -- from the EPA.

3 Our prospects want to see a physical

4 certification. We think it's important to be able to

5 demonstrate that and show that to them. So waiver -- a

6 waiver in a document form that is easily accessible as

7 well on the web would be important.

8 We'd propose several enhancements and changes

9 to the proposed rules to fully realize the EPA's

10 conversion market objectives for E85 flex fuel vehicles.

11 I'm going to work my way down this page. This

12 summarizes the changes that we're proposing, and then

13 I'll go through why we think each one of these are

14 important.

15 Number 1, a fuel specification should be

16 issued and it should represent fuel sold in the market

17 for testing. The fuel that -- that -- the fuels that we

18 can buy are fuels that are available in the market and

19 meet ASTM standards. The test fuel that we have to test

20 with and -- and -- and get our computer to conform to

21 that fuel is something we cannot legally buy. And it is

22 outside the ASTM. So it's our -- our test re -- results

23 can be erratic. And I'll get into that more later.

24 There's some clarifications that we would

25 like; clarification when to conform -- confirmatory

471 testing is required. We think one successful test

2 should be enough for the same engineering design of the

3 product. And this -- this theme kind of carry --

4 carries through. There's a lot of tests that we have to

5 do from a -- an engineering judgment standpoint.

6 There -- there should not be any need to continue to

7 burden us with a test.

8 Clarification that existing certification can

9 be used with the proposed intermediate age rules to

10 carry forward and carry back. So as we have a 2006

11 Crown Victoria certification with the new rules can we

12 carry forward. And that fact wasn't clear to us in

13 the -- in the proposed rules if we can -- we can do

14 that. It makes logical sense that we can we think.

15 Publish the OBD group so we can determine

16 carry forward and carry back groups. So one of the

17 steps that we go through in determining which kits can

18 we convert is how large is the production volume that's

19 out there that we can address. We need to know what the

20 addressable size of the market is, and the only way to

21 do that is if we know what that those OBD groups are.

22 And those aren't published. We often have to check with

23 your staff on what that means. And I think that creates

24 a burden on them as well. We could -- we could do this

25 on our own.

481 Clarify that what we mean by outside useful

2 life. I'll talk about that. But obviously there's --

3 there's a lot more mileage and a years thing. It's

4 difficult for us to market to a mileage standard. So

5 we'd like some clarification on that.

6 Require converters to certify vehicles as new

7 or nearly new before allowing use of intermediate or

8 outside useful life groups. We're quite proud of the

9 work that we put into our kit to make sure that it

10 maintains the very highest standards that the EPA

11 requires. As I said, we do compete with the -- the

12 black market kits as well. We are -- we are -- we know

13 about the technology. We know it does not deal with the

14 variety of conditions that -- that the car needs to deal

15 with, and we think that they need to -- they should be

16 proven to meet those standards as well before allowing

17 them to certify under a lower tiered bar. So the

18 technology, we think the technology should meet an EPA

19 standard before the lower tiers are -- are awarded.

20 Used vehicle types and engine classifications

21 for determining the certification groups. Eliminate the

22 OEM vehicle -- vehicle durability classification as it

23 does not meet the spirit of the change.

24 Okay. So those are some clarifications we

25 would like. We'd also like to modify some of the

491 proposed rules. One, allow the use of estimated NMOG

2 for flex fuel conversions throughout -- through an NMHC

3 NMOG ratio. This is being proposed for CNG and propane.

4 We'd like to have that same option as well. The NMOG

5 test is very expensive. It's not entirely useful in

6 our -- in our calibrations, so we'd like to see a ratio

7 be available to converters.

8 Don't require the cold start testing but if it

9 continues it be a required use an on spec fuel. Cold

10 start test -- testing is, of course, the most difficult

11 part of the test. The fuel that the lab uses has an RVP

12 of about 6.0. You can't buy that in the fuel, but it --

13 but it doesn't -- it doesn't ignite very easily at all.

14 So it's very difficult to get the -- the conversion

15 system to work with a -- a fuel speced at that level.

16 Drop the suggestion for multiple fuel ratio

17 testing. It's not required by the OEMs, so this is in

18 reference to different blends of fuel that would have to

19 be tested. We think that if the OEM vehicles that were

20 converting of similar models have to meet that spec then

21 that's fine with us, but we shouldn't be held to a

22 standard that they're not held to. So -- so that's our

23 position on that.

24 Consistently apply the California NMOG

25 standards for -- or completely repair all the

501 inconsistencies. We've -- we've had many -- many

2 discussions with EPA about the use of the California

3 standard. In some cases some of the rules are used and

4 other cases they're not. We'd like a consistent

5 application of the rules, and if there -- if there are

6 problems with some of them that exist let's -- they

7 shouldn't be on the books. So let's -- let's get those

8 clarified.

9 Fourth, extend the use of good engineering

10 judgment where you can show past testing and -- and good

11 engineering judgment that conversions do not modify,

12 alter, or negatively impact OEM performance. A

13 statement of compliance should be allowed in lieu of the

14 demonstration, including OBDII, canister loading, and

15 shed test. In our -- in the case of our technology we

16 do not alter anything on the vehicle. It is

17 supplemental to the vehicle and in the kit in its

18 entirety. We don't change anything with the computer

19 and so forth. And -- and that engineering design does

20 not change for us from application to application, so.

21 Okay.

22 So the following pages, if I -- if I have the

23 time, I'd just like to just go through and -- and

24 clarify what we mean.

25 I -- this the first one is in regards to the

511 fuel spec. The RVP is too low and it is unstable. The

2 fuel is made from a neat ethanol. It is not denatured.

3 It is then engineered with a butane infusion to get the

4 RVP up. It's tested long -- the RVP is tested long

5 before the car is actually tested, so that -- it is an

6 unstable fuel and its RVP will degrade. So our -- our

7 test results are not -- we can't rely -- reliably test

8 for them when we can't get that fuel and try to

9 replicate what's -- what's going to be done, the

10 sampling done from the pressurized tank. So by the time

11 that that -- the fuel is tested in our vehicle the RVP

12 has changed.

13 Ethanol, we can't legally buy or produce this

14 test fuel at all. So we don't have an alcohol license,

15 so I can't get the -- I can't the fuel, nor can I -- can

16 I set up a facility where I can infuse the butane

17 into -- into the fuel.

18 The OEM test labs do use ASTM standard fuels

19 in their conformity applications, so we've seen them, we

20 understand what they are. They're consistent with the

21 fuel that's available in the market, so that's what's

22 run in the car when the application is put in. We'd

23 like to have that same option.

24 So -- so what -- and EPA will often test the

25 in-use cars with -- with that fuel, but DF factors are

521 applied. So even though they're using the same fuel the

2 standard is a little bit easier. So we'd like to -- if

3 you're going to use a fuel, let us -- let us use the

4 same calculations with not -- by not applying the DF

5 factors. We think it creates an unfair advantage for

6 OEMs over the conversion market so this is why we'd like

7 that. Intermediate classified tests should be

8 consistent with the OEM test procedures. That's --

9 that's the fuel.

10 On the -- on the clarification, clarify when

11 confirmatory test is required. I mentioned that our --

12 if our design is the same we should not have to have to

13 retest. Clarify that an existing certification can be

14 used with the proposed intermediate age groups. I

15 mentioned publishing the OBDII groups that helps us in

16 selection.

17 Outside useful life -- having trouble. Two.

18 Okay.

19 We're not clear what the goals are on the

20 outside useful life. I -- we -- we -- we think they're

21 good goals. We're just not clear how it is we can apply

22 them when -- when mileage varies so much. We're focused

23 mostly on cars and -- and light -- light duty trucks, so

24 the variability out there is pretty significant. So

25 it's difficult.

531 Require converters to certify vehicles as new

2 or nearly new. I mentioned that lowering the bar, we

3 believe alternative fuel conversion technology

4 convertors should prove the technology works, so we --

5 we're very supportive of that. But we don't think we

6 should allow inferior technology that can't meet the

7 standard to be applied on older vehicles.

8 Use vehicle type and engine classification to

9 determine certification groups, eliminate the OEM

10 vehicle durability classification, it doesn't meet the

11 spirit of the change. Durability groups are fragmented

12 and very complex. It doesn't add value in design and

13 the testing, and it substantially increases the burden

14 by requiring multiple tests against the same

15 application, for example, 4.6 liter vehicles.

16 Now we go three. Reduce the testing burden.

17 Here's some ideas on that. I mentioned NMOG. Use the

18 on spec fuel. I talked about the 6.0 RVP is simply too

19 low. And it's very -- it's -- while -- while there are

20 some classifications where this is viable, not at

21 75 degrees in the -- in the class 2 test conditions.

22 Consistently apply multiple fuel ratio testing and

23 consistently apply the California NMOG standard. The

24 standards and equations applied in the lab are

25 different. Converters rely on California standards and

541 the CFR. For -- if there's errors, we'd like to see

2 those fixed.

3 And then, lastly, we'd just ask that we use --

4 we could extend the use of good engineering judgement.

5 We've had a lot of success with you in doing that

6 before. We'd like to be able to see that we don't have

7 to do the OBDII testing, again as we're loading the shed

8 test, where it's clear that these things are not -- not

9 effective. In most if not all cases alternative fuel

10 conversion technology is based on a standard design, and

11 previous demonstrations should -- should suffice.

12 So those are the -- the highlights. I'm again

13 delighted to be here and be able to hear the testimony

14 from the other converters interested in this. I'm

15 heartened to see that, you know, the consistency in some

16 of our needs. Can I answer any questions?

17 MS. COHEN: Thank you very much. To the

18 extent things in our proposal are not clear to you,

19 please put those questions into writing for us, and then

20 we will be able to respond to them when we respond to

21 them --

22 MR. DISHER: Absolutely.

23 MS. COHEN: -- in the rulemaking process.

24 MR. DISHER: Absolutely.

25 MS. COHEN: Thank you.

551 MR. DISHER: Thank you.

2 MS. COHEN: Questions?

3 MR. REINEMAN: Yeah, Chris, if you don't mind,

4 maybe you could provide written comments back to us with

5 a little more support for why you believe that shed

6 testing is not necessary for your system if you add any

7 hardware to your vehicle, and also your comments about

8 why you believe that reduced confirmatory testing is

9 appropriate for your technology. In particular if

10 there's anything beyond the standard concept or design,

11 but if you're changing fuel maps with the vehicle, for

12 example, is it still appropriate to have kind of a

13 one size fits all or a much reduced burden of

14 confirmatory testing seems to be an issue.

15 MR. DISHER: Yeah.

16 MR. REINEMAN: And support for those things,

17 we would like to see some more comments about that.

18 MR. DISHER: Gladly, Martin. As you know,

19 our -- our kit is largely altered just to the fuel map

20 technology, so we think anything outside of that we'll

21 provide support for that. And -- and the other points

22 as well, we'll get you analytics and facts.

23 MR. REINEMAN: Okay. Thanks.

24 MR. DISHER: Thanks.

25 MS. COHEN: Mr. Clarke?

561 MR. CLARK: Good morning. My name is Jeff

2 Clarke. I'm pleased to offer the following statement on

3 behalf of NGV America. NGV America is a national trade

4 association demoted -- devoted to promoting the

5 increased use of natural gas vehicles.

6 I'm not going to read all my prepared

7 statement that we've entered in for the record today.

8 Rather I'll do my best to summarize those -- the

9 statement. And I will offer some additional thoughts on

10 today -- on this rulemaking.

11 NGV America believes that the national -- that

12 national transportation and energy policies should

13 encourage increased use of natural gas as a

14 transportation fuel. Natural gas vehicles can play an

15 important role in increasing energy security, creating

16 U.S. jobs, providing cleaner air, and reducing

17 greenhouse gas emissions, while also generating economic

18 benefits for fleets and consumers. These benefits

19 result from the fact that natural gas is a domestic fuel

20 with an abundant resource base here in the U.S. and in

21 North America. Natural gas is also a low-carbon fuel

22 that -- with a proven record of reducing harmful

23 pollutants that contribute to ground level ozone, ground

24 level pollution, and other air quality concern.

25 We congratulate EPA for its effort in

571 developing this proposed rulemaking. It has been a long

2 time coming and is welcome. We believe that the

3 proposal issued by the EPA will go a long way toward

4 encouraging and expanding the use of non-petroleum motor

5 fuels and vehicles powered by alternative fuels. This

6 action is possibly as important as any the government is

7 currently considering in order to advance the use of

8 non-petroleum fuels. Only time will tell how much of an

9 impact this rule making will have. Never the less, it

10 is an important step in the right direction.

11 We continue to believe that certification of

12 aftermarket systems is important to ensuring the

13 environmental integrity of alternative fuel systems.

14 That is why we have supported emission certification

15 procedures for many years going back to the early 1990s

16 when it was first proposed. And today we continue to

17 support the certification requirements. However, we

18 believe that the current regulatory requirements are --

19 are unduly restrictive. So we commend the EPA for

20 recognizing that its regulations as currently written

21 are not a good fit for aftermarket conversion and that

22 they should be modified to be more accommodating of

23 alternative fuel conversion.

24 The preamble for this proposed rulemaking

25 acknowledges that the current certification process is

581 not optimal for ensuring compliance with emission

2 standards, and the complexity of the certification

3 process presents a barrier to entering into the

4 alternative fuel conversion market. These are important

5 acknowledgments. These factors and the potential that

6 alternative fuel conversions hold for advancing the use

7 of alternative fuels, replacing petroleum, and reducing

8 harmful emissions are ample reason to move forward with

9 this rulemaking and adopt a more flexible -- and adopt

10 more flexible procedures for aftermarket systems.

11 Why are conversions important? Our industry

12 for many years embraced a notion that the only way to

13 grow this market was through the OEM alternative fuel

14 vehicles, but what we have seen is an industry that has

15 struggled to realize the potential and one that has

16 grown much too slowly over the years. In order to grow

17 this market, we need OEMs and conversions -- and

18 aftermarket conversions. Until there are sufficient

19 number of OEM products available in the marketplace, our

20 industry will continue to need aftermarket conversions

21 to help us grow, to help us justify the necessary

22 investments in fueling infrastructure, and to help us

23 increase our market penetration.

24 Conversions fill a void unmet by OEMs and

25 demonstrate consumer demand for new applications.

591 Conversions also provide a ready means of addressing the

2 emissions and fuel consumption of medium and heavy duty

3 vehicles that will continue to be in operation for many

4 years to come.

5 I think a number of the speakers addressed

6 that market potential and we're pretty excited about

7 that -- those applications for in-use, medium and heavy

8 duty vehicles.

9 In some cases the manufacturers of conversion

10 systems will become suppliers to the OEMs and they will

11 be instrumental in helping OEMs get new product into the

12 market.

13 We've seen that before where the OEMs are

14 partnered with the same companies that are vying for the

15 aftermarket industry.

16 The increased availability of these

17 conversions I think will actually help to more quickly

18 get us to the day when most OEMs offer a full line-up of

19 NGVs and other alternative fueled vehicles. Therefore,

20 it is important to take the steps to advance the use of

21 conversions.

22 Comments on the EPA Proposal. We plan to file

23 more extensive comments before the deadline next month.

24 For today I just will offer the following comments.

25 With respect to new vehicles, we support EPA's plan to

601 adopt and include in its regulation the flexible

2 provisions that it has been providing via guidance

3 today. Including these procedures in the regulations

4 provides greater certainty for the market with respect

5 to being able to use these procedures in the future. So

6 that's helpful.

7 We also believe that the additional

8 flexibility to certify multiple engine families or test

9 groups is warranted even beyond what EPA has proposed in

10 its proposal. We have supported the adoption of

11 legislation directing the EPA to develop procedures

12 allowing manufacturers of aftermarket systems to combine

13 test groups of vehicles manufactured by different OEMs.

14 We believe that with appropriate safeguards this type of

15 certification can be appropriate. At the very least we

16 believe that manufacturers of aftermarket systems should

17 be given the opportunity to demonstrate they can

18 successfully employ strategies that allow them to

19 combine test groups or engine families of different

20 manufacturers.

21 Certification Fees. We believe that EPA

22 should modify the certification fee process to allow

23 aftermarket manufacturers to pay these fees at the back

24 end instead of upfront. Currently manufacturers must

25 pay their fees upfront based on expected sales. If

611 these sales do not materialize, they can request a

2 refund. I'm told. I've never paid the fees or

3 requested a refund. The requirement to submit these

4 fees and then later request a refund ties up valuable

5 funds, funds that small manufacturers need to develop

6 additional systems. We therefore would propose the EPA

7 adopt procedures that allow these manufacturers the

8 option of paying the fees at the end of the quarter or

9 annually based on the total number of vehicles actually

10 sold under a certificate.

11 Approval Process for Intermediate Age

12 Vehicles. We support the proposal -- the proposed

13 approval process for vehicles that are two years or

14 older. Currently most of our members do not opt to

15 convert such vehicles or offer products for such

16 vehicles. However, additional flexibility offered for

17 such systems and the fact that EPA is waiving fees for

18 such systems could potentially be an incentive for

19 businesses to pursue conversion systems for older in-use

20 vehicles.

21 And we think there's going to be just a

22 tremendous interest in this approval process, and you're

23 going to see a lot more companies come to the table if

24 this rule is finalized.

25 Mixed Fuel Vehicles or Bi-fuel Heavy Duty

621 Engines, which the first couple speakers addressed this

2 market. We are seeing a growing interest in vehicles

3 that operate on a mixture of natural gas and diesel

4 fuel. This is a relatively new development for us as an

5 association, NGV America. From what we have learned

6 about these systems and how they operate, we believe EPA

7 should consider providing additional flexibility for

8 such systems, particularly in those systems that do not

9 make any changes to the diesel operation of the vehicle

10 or engine other than making it possible for the vehicle

11 to operate on a mixture of diesel and natural gas.

12 And we will provide additional information on

13 this issue in our July comments.

14 Chassis versus bench testing. We support the

15 comments that you've heard earlier today regarding the

16 ability to do in-use chassis testing for over being

17 required to do bench testing because of the cost and

18 just the difficulty of -- of doing that sort of testing.

19 US06 Testing. EPA requested comment to when

20 it would be appropriate to require US06 testing. At

21 this point we would not support such a requirement given

22 that it's not required for the OEM manufacturers, and we

23 would see that as potentially putting something in place

24 more burdensome as opposed to more flexible for the

25 aftermarket industry.

631 Beyond Useful Life Vehicle. We current have

2 not reached an agreement on what -- which of the three

3 proposals we plan to support. However, we do support

4 the idea of requiring submission of information to EPA,

5 including the beyond useful life engines in your

6 approval process. We think that would be valuable to

7 have EPA reviewing these documentation and providing

8 information on its website about these systems. So we

9 would support that.

10 Warranty Issues. We would urge EPA to include

11 a strong statement on the issue of warranty coverage in

12 its final rule.

13 We still get a lot of calls about warranties

14 and whether converting a vehicle with an OEM warranty.

15 Previous rulemaking and the guidance, I've

16 addressed this issue in a way so as to make it clear

17 that converting a vehicle to operate on alternative fuel

18 does not void the original OEM warranty. Such a

19 statement should be included in the rulemaking, possibly

20 in the preamble if not in the regulation itself.

21 California Air Resource Support. More and

22 more states are adopting the California requirements for

23 new vehicles. We would like to see EPA provide clear

24 guidance regarding the legality of converting vehicles

25 in states that have adopted the CARB regulations for new

641 vehicles. Our industry supports the continued ability

2 to convert vehicles in such states using EPA-approved

3 systems as long as the vehicle to be converted is a

4 49- or 50-state vehicle and the state at issue has not

5 specifically adopted California's regulation for

6 aftermarket conversions. We believe this is the legally

7 correct approach. However, it would be very useful to

8 have EPA publicly state this in its -- in its rulemaking

9 discussion. Otherwise it becomes an issue that

10 continues to cause confusion and lead to doubt as to

11 whether converting vehicles in such states is legal.

12 And we essentially have to go state by state

13 and try and get some sort of decision from these

14 officials. And a lot of times when we talk to these

15 officials about this issue it's completely new to them

16 and it takes them many, many months to figure out what

17 the answer is, if we can even get an answer from them on

18 this issue. So that would be helpful.

19 That concludes my remarks. And thank you very

20 much, and we will be submitting comments next month.

21 MS. COHEN: Thank you. I'd appreciate if

22 those comments could include -- include any -- you know,

23 a pretty detailed discussion of any criteria we will

24 have to look at to consider your suggestion of allowing

25 manufacturers of converters to combine manufacturers

651 into a single test group.

2 MR. CLARK: Yes.

3 MS. COHEN: We'll determine whether that's

4 appropriate or not for a vehicle system --

5 MR. CLARK: There's a protocol --

6 MS. COHEN: -- test group.

7 MR. CLARK: -- in the UN regulation for doing

8 that, too. We can submit that and some more

9 information.

10 MS. COHEN: Anything you have on that would be

11 really helpful.

12 MR. CLARK: Okay.

13 MS. COHEN: I have a request for a break, so

14 we will take a ten-minute break at this point, and then

15 we'll hear from the last couple speakers. I'd also ask

16 at this time if there's anyone else who wishes to speak

17 who did not sign up beforehand to do so now outside, and

18 we will have an opportunity to talk at the end of the

19 presentations. Thank you.

20 We convene at twenty minutes to 11:00.

21 (10:31 a.m. recess taken)

22 MS. COHEN: We are going to get started again,

23 please. The next presenter is Mr. Ambrozaitis with the

24 Alliance of Automobile Manufacturers.

25 MR. AMBROZAITIS: Yeah, good morning,

661 Everybody. I'm Giedrius Ambrozaitis with the Alliance

2 of Automobile Manufacturers. I have brought some

3 testimony with me, some copies of it, but apparently it

4 didn't make it into the package, so it's outside if you

5 want to get it after -- after we're all done here. I

6 think everybody upfront, though, has copies of it. So

7 let me just go ahead and I will just read highlights

8 from my testimony. The full testimony covers a -- a

9 little bit more. And, of course, we will be giving the

10 written testimony to the comment document.

11 Again, I am Giedrius Ambrozaitis, the Director

12 of Environmental Affairs for the Alliance of Automobile

13 Manufacturers. Thank you again for the opportunity to

14 speak at this hearing.

15 The Alliance of Automobile Manufacturers is a

16 trade association of eleven car and light truck

17 manufacturers, including BMW Group, Chrysler, LLC,

18 Ford Motor Company, General Motors, Jaguar Land Rover,

19 Mazda, Mercedes Benz U.S.A., Mitsubishi Motors, Porsche,

20 Toyota, and Volkswagen. Our member companies are

21 committed to providing safer, cleaner, and more fuel

22 efficient automobiles that operate on a number of

23 alternative fuels while meeting the nation's criteria

24 pollutant and greenhouse gas requirements.

25 Increasing the sales of clean alternative

671 fueled vehicles requires consumers remain engaged and

2 confident in their choice of alternative fuels.

3 Automakers recognize the importance of a positive

4 consumer experience with alternative fuel vehicles, both

5 for their company's reputations and for the future of

6 alternative fuels. Because consumers expect alternative

7 fuel vehicles to operate as a regular fuel vehicle,

8 automakers engineer and produce their alternative fuel

9 vehicles with the same care and diligence as regular

10 fuel vehicles.

11 We fully support EPA's efforts to revise the

12 alternative fuel conversions requirements and the steps

13 being proposed to ensure a vehicle's emission systems --

14 emission's control system is compliant for the full

15 useful life of the vehicle. However, the proposed

16 changes by EPA to fuel conversion regulations if not

17 properly implemented possess the potential to negatively

18 impact the acceptance of alternative fuels by consumers;

19 therefore, we recommend that the following safeguards be

20 implemented to ensure proper emissions durability

21 engineering by converters to guarantee the long-term

22 operability of the vehicles on alternative fuels. These

23 safeguards will also ensure that warranty and in-use

24 responsibilities are reassigned to converters in an

25 enforceable manner.

681 EPA should retain current demonstration and

2 documentation requirements to ensure continued proper

3 engineering with conversions. EPA proposes to split the

4 current single certification category into three

5 categories depending on the age of the vehicle and the

6 mileage. The current requirements would continue for

7 converting one-year-old vehicles within their useful

8 life. For vehicles older than one year and for vehicles

9 whose mileage has exceeded their full useful life, EPA

10 is proposing a significant easing of certification

11 requirements. The removal of these certification

12 requirements creates an unwanted and undesired

13 opportunity for poorly engineered conversions being

14 marketed to the public.

15 Specifically for the two new categories,

16 intermediate age and outside full useful life,

17 automakers oppose making available a new definition for

18 conversion group which would cover multiple test groups

19 and even durability groups. Automakers also oppose

20 removing the requirement to submit a certification

21 application and request a certificate of conformity.

22 Both of these actions would have a great potential to

23 lead to poor engineering of conversions.

24 We recognize, however, that alternative fuel

25 conversion companies may see some economic and

691 procedural implements -- impediments to certify

2 alternative fuel conversions. However, small volume

3 converters are already provided with options not

4 available to larger OEMs, including reduced

5 certification fees, the ability to use assigned

6 emissions deterioration factors, and reduced IDVP

7 requirements.

8 To assist small volume companies while

9 preserving the effectiveness of the certification

10 process, we recommend that EPA could further reduce

11 certification fees or assign a dedicated person to

12 assist conversion companies with the certification

13 requirements in process.

14 EPA proposes to require that all fuel

15 conversions have a supplemental label applied in the

16 area of the existing underhood veci label, which would

17 meet the following requirements: We agree with EPA's

18 requirements for the label and recommend that the label

19 also show the converted vehicle's estimated cruising

20 range and the converted vehicle's emission certification

21 standard. In addition, we strongly recommend that the

22 label should include the following statement be added at

23 the end: OEM warranties will not cover damage to

24 existing systems from damage caused by fuel conversions.

25 In addition, we recommend that a second label

701 identical to that one should be required to be

2 permanently affixed to the driver door B pillar or the

3 glove box door or the center console area to ensure that

4 the consumer or the potential next purchaser is properly

5 informed of the vehicle's conversion and warranty

6 status.

7 Similarly, if a reflash of the on-board

8 computer ECU is performed, a label should also be

9 required to be affixed in the vicinity of the OBD port.

10 We recommend that EPA publish a list of VINs of

11 converted vehicles and make this list available to OEMs

12 and to State inspection maintenance agencies to help

13 ensure that these organizations are properly informed of

14 the vehicle's conversion and warranty status.

15 By implementing these recommended changes to

16 its NPRM EPA will continue to support our Clean Air Act

17 goals by further ensuring key certification requirements

18 remain in place, thus avoiding negative impacts to

19 alternative fuel vehicle acceptance, full useful life

20 emissions compliance, OBD system effectiveness, and

21 ultimately customer satisfaction.

22 Ensuring that adequately engineered and

23 durable vehicles are properly certified is the best way

24 to promote our nation's goal for increased alternative

25 fuel usage while at the same time assisting small volume

711 conversion companies.

2 Thank you for your attention. If there's any

3 questions, I'll try and answer them now or in my written

4 comments.

5 MS. COHEN: Questions?

6 MR. REINEMAN: Maybe clarity on vehicles

7 outside full useful life.

8 MR. AMBROZAITIS: Anything more specific?

9 MR. REINEMAN: (Indicating).

10 MS. COHEN: Also what you were envisioning for

11 collecting vehicle VINs, proposing how to do that?

12 MR. AMBROZAITIS: We haven't given any thought

13 on that one, but we can flush that out in our comments.

14 MS. COHEN: Thank you.

15 MR. AMBROZAITIS: Thank you.

16 MS. COHEN: Mr. Webster?

17 MR. WEBSTER: Good morning. I wanted to say

18 thank you for having me. Also I wanted to say, Man, I

19 feel out of my league. But I really wanted to come up

20 and say a word. I'm from the Natgascar Company. We're

21 a small company. We just started within the past year.

22 Our biggest product is going to be a home refueling unit

23 that we're working on currently through the CSA

24 certified unit. But we are also working in conjunction

25 with CSI down in Asheville, North Carolina, on a

721 conversion kit for the 2010 Dodge 4.7 liter engine.

2 So in trying to kind of preface that, I don't

3 have as vast of the knowledge as a lot of the people

4 that spoke, but one of the things that I have been

5 involved with is kind of the check writing process, and

6 from a smaller company's standpoint seeing how expensive

7 and how limiting that -- that can be, so moving forward

8 and kind of my comments on that, so.

9 Like I said, we're right down in Cleveland,

10 Ohio, right down from where we are now and we'll be

11 doing a conversion kit. We have -- should be ready by

12 August 1st. As we progress further down the road,

13 development road with our kits, we have been faced with

14 the enormous overhead of getting a kit tested and

15 approved to EPA standards. The EPA has a crucial place

16 in the equation and -- to set the baseline and make sure

17 that everything is kept to standard. However, for a

18 small business like ourselves these costs are borderline

19 prohibitive and keep us out of -- and keep us and other

20 small businesses from further optimizing the alternative

21 fuels market.

22 In order to help Natgascar and others be

23 successful in the alternative fuels industry, we would

24 like to see some changes that are -- some of them are

25 currently in -- proposed and then some of them are added

731 on, and some -- most of these that were suggested to us

2 by the folks at CSI just because we're busy, we're --

3 there's -- there's four of us and we're busy working on

4 engineering our product, and they're helping us to with

5 this one.

6 So first and foremost we support the need to

7 have a certification qualify for multiple years. Having

8 that for multiple model years will help small business

9 like ourselves distribute our investment costs over

10 several years as opposed to a single one. This in turn

11 will allow us to offer a more competitive price to our

12 consumers and thus get -- hopefully get more clean

13 vehicles on the road.

14 Secondly, there are some areas of testing

15 which seem quite redundant and delay the release of our

16 product. Having to submit to retesting from the EPA

17 labs after an EPA recognized lab such as Roush has

18 certified a kit is not only redundant but again very

19 costly for manufacturers. Besides the physical cost of

20 testing, preparing, shipping, et cetera, there's also

21 the time -- the cost of time which further delays our

22 product release behind the OEM. Additionally, a carry

23 forward sales exemption and eliminating multiple OBD

24 tests per manufacturer would help cost and time delays.

25 A carry forward sales exemption would allow companies

741 like ourselves who have certified a current model year

2 and plan to certify the following year to pursue

3 conversions when the vehicle is being released as

4 opposed to three to six months after. The multiple OBD

5 tests are extremely expensive and time consuming. Once

6 a company has proven O -- OBD compliance with a given

7 OEM it makes sense that it should be carry forward

8 through the entire OBD product line.

9 We're making every effort to do the right

10 thing and take the right steps, but as I mentioned, for

11 a small company the cost can be overwhelming. With a

12 few changes to the existing policy, we can make steps

13 easier and in the process create more domestic jobs,

14 reduce foreign dependency, and minimize our impact on

15 the environment.

16 Any questions?

17 MS. COHEN: Will you be submitting comments?

18 MR. WEBSTER: Yes. Yeah, I'll have a

19 formal -- like I said, they just kind of -- they sent me

20 up. And I'm sorry. But I'll -- I'll be submitting

21 formal -- formal comments.

22 MS. COHEN: Thank you.

23 MR. WEBSTER: Thank you.

24 MR. REINEMAN: We'd like clarification of your

25 carry forward concept.

751 MR. WEBSTER: Yes.

2 MR. REINEMAN: It wasn't clear exactly what

3 OEM test group flexibility you were speaking to there.

4 MR. WEBSTER: Okay. Thanks.

5 MS. COHEN: Thank you. We have had I believe

6 two additional requests for speakers. Karen Hay.

7 MS. HAY: Thank you. Good morning. My name

8 is Karen Hay. I'm with IMPCO Technologies. To give you

9 a brief background on IMPCO, we recently purchased a

10 company called BRC and together we formed a holding

11 company called Fuel Systems Solutions. Together IMPCO

12 and BRC last year sold about 500 million dollars -- or

13 had 500 million dollars in revenue and had our systems

14 installed on approximately one million engines

15 throughout the world. Non-U.S. market is obviously much

16 bigger than within the U.S. markets, everything from

17 primarily light duty vehicles to industrial engines.

18 Both companies are engaged in certifying the

19 systems, primarily propane and natural gas. And

20 together we have over 1,700 employees throughout the

21 world. So we're a pretty good size company.

22 Just want to start out by saying that IMPCO

23 commends EPA for recognizing the importance of

24 alternative fuel vehicles and they need to streamline

25 the certification process. But the aftermarket

761 alternative fuel vehicle industry as a whole is held to

2 a different standard than any other aftermarket parts

3 industry. Alternative fuel vehicle manufacturers must

4 undergo rigorous, costly, and time consuming

5 certification testing and diagnostic validation, adds

6 months and tens of thousands of dollars onto the cost of

7 a system, usually for only a couple hundred units. On

8 the other hand, aftermarket parts do not require

9 certification of any kind.

10 For example, anyone can manufacture and sell a

11 turbocharger or custom intake or modified exhaust

12 without any certification costs or EPA interface. And

13 while IMPCO is a firm believer in ensuring that all

14 vehicles continue to meet the emissions standards, we

15 also believe that there are multiple pathways that can

16 be used to -- to achieve the same net results.

17 There are just a few items that I wanted to

18 touch on here. I'll be submitting comments later with

19 more detail, but sorry, I don't have any handouts.

20 One of the first things is the definition --

21 the definition and duration of a certificate of

22 conformity. Model year and certificate duration are

23 defined as follows. The conversion model year means --

24 and this is from the preamble, conversion model year

25 means the clean alternative fuel conversion

771 manufacturers annual production period which includes

2 January 1st of such calendar year. A specific model

3 year may not include January 1st from the previous year

4 or the following year. Effectively the conversion model

5 year is effective for two years minus one day. A

6 certificate issued under the section is valid starting

7 with the indicated effective date but is not valid for

8 any clean alternative fuel conversion systems you

9 manufacture after December 31st of the conversion model

10 year. So it's also saying that the certificate is the

11 same as the model year, which is two years minus one day

12 is the maximum length.

13 In IMPCO's opinion the existing definition of

14 model year under the Clean Air Act, which are the

15 definitions that I -- I just stated, are for new

16 vehicles. Because the Clean Air Act does not specify

17 the duration for an aftermarket vehicle, IMPCO believes

18 that EPA has the authority to define certificate -- the

19 certificate duration and also the model year and

20 definition differently as compared to that for the OEM.

21 And one thing that I wanted to point out is

22 that CARB aftermarket certificates are valid

23 indefinitely. There is absolutely no expiration date on

24 them. We actually have some dating back 20 plus years.

25 So those don't require annual recertification of any

781 form.

2 Next topic, certificate of conformity versus

3 notification. Many alternative fuel vehicles qualify

4 for various state or federal incentives. However,

5 certificate of conformity may be required to qualify for

6 these incentives. Therefore, the certificate will have

7 to be renewed annually as was previously defined per the

8 current procedures. And so you will also have to

9 continue paying the certification fees if you want to be

10 able to keep that certificate so that your end user can

11 actually take advantage of incentives that might be

12 available. And this is also where your definition of

13 certificate or model year is appropriate.

14 Next is the VIN tracking information. You had

15 requested comments on tracking the VIN numbers. It

16 states -- the preamble states the reason for VIN

17 tracking would be to assist automotive dealers or repair

18 facilities, state inspection and maintenance program

19 personnel, and others who might need to know whether a

20 vehicle or engine has been altered from its OEM

21 configuration.

22 Now, in order to do this, and especially, for

23 example, for an I and M test, this would require an

24 instant and up to date, some tracking mechanism that EPA

25 would have to put together and make available on its

791 website. I believe that this would call -- cause an

2 unnecessary administrative burden on EPA. And if, for

3 example, somebody goes in, they have a certified system,

4 there's an underhood label stating as such, but their

5 VIN isn't in the system, are they going to be turned

6 away? Will they not be able to register that vehicle?

7 That's -- that's one of my concerns is the timeliness

8 and also the burden given the net result and how

9 effective this will be.

10 EPA had also requested comments on SFTP and

11 cold CO testing. Given that these tests are not

12 required for the OEM, we don't consider it to be fair

13 that the alternative fuel system would be required to

14 meet something that the OEM system is not designed to

15 meet.

16 The next is CARB states. Certain states have

17 adopted California emission standards for only vehicles

18 with a CARB executive order maybe sold in that state --

19 in that state. There are certain restrictions. It has

20 to be either a new vehicle or a used vehicle with more

21 than 7,500 miles, but for the most part new vehicles

22 have to have a CARB certificate. For this to occur,

23 however, each state much must specifically adopt the

24 applicable California regulations. In some cases

25 certain states adopted new vehicle CARB regulations. In

801 some states they adopted new and aftermarket

2 requirements. So there are specific differences between

3 the two adoptions. The California code of regulations

4 2030 is what specifies the California aftermarket

5 requirements. If a state does not explicitly put in

6 that they adopted 2030, that state should accept an EPA

7 certified system. There's been some question in the

8 past that for these CARB states whether or not they

9 should accept an EPA certified aftermarket system, and

10 so as Jeff had mentioned we've been going state to state

11 speaking with people that really are not familiar with

12 this issue and it's -- it's caused quite a headache.

13 And there are about 13 states so far that have

14 adopted the CARB regulations, I'm sure more will be

15 coming up soon, and the burden that's put on us, the

16 small guy is, is truly unnecessary. So we would like

17 some sort of clarification be put in the preamble or in

18 regulation itself clarifying this issue. Because,

19 again, getting to the right person and getting them to

20 issue some sort of a definitive statement is a very,

21 very difficult thing to do.

22 Let's see. And finally greenhouse gases and

23 CO2 emissions. The proposal states that if the engine

24 was certified with the family emission limit for NOx,

25 hydrocarbon plus NOx, or particulate matter as noted on

811 the vehicle emission control information label, the

2 modified vehicle or engine may not exceed this family

3 emission limit.

4 Given the new greenhouse gas regulations that

5 recently came into effect for both CO2, greenhouse

6 gases, and who knows what else future requirements will

7 be required, I'd like to propose that you include other

8 types of emission standards under the family umbrella --

9 under the family umbrella limit. So instead of

10 explicitly restricting it right now to NOx and

11 hydrocarbon plus NOx as stated in the reg, open it up

12 not only for CO2 emissions, greenhouse gas emissions,

13 but also for any other family limits that may come out.

14 Like I mentioned before, we're going to be

15 submitting formal comments and I'll be submitting some

16 more detail on that. If you have any questions?

17 MS. COHEN: Any questions?

18 MR. REINEMAN: I don't think I do if you're

19 going to submit more detail here. We'll see it then.

20 MS. HAY: Sure.

21 MS. COHEN: All right. Thank you very much.

22 The last presently today is Mr. Roger Galloway of BAF.

23 MR. GALLOWAY: Good morning. I'm Roger

24 Galloway with BAF Technologies. I appreciate the

25 opportunity to be here, thankful for EPA's efforts in

821 streamlining the process.

2 I just had one question. BAF will be posting

3 our -- our comments to your docket, but in reading the

4 regulations as proposed it's not clear to me whether EPA

5 is going to accept in the area of OBDII compliance,

6 whether an added on or a separate aftermarket conversion

7 system, whether you could diagnose that through a

8 separate proprietary port or whether the complete

9 on-board diagnostics for the entire system -- for the

10 entire vehicle would have to be run through the original

11 DLC utilizing the OEM now function indicator.

12 MS. COHEN: Well, if you -- if you will put

13 that question specifically in your comments --

14 MR. GALLOWAY: I will. I will.

15 MS. COHEN: -- we will get it.

16 MR. GALLOWAY: It just seems counter-intuitive

17 to think that you could have a separate on-board

18 diagnostic system that wasn't fully integrated into the

19 original system.

20 MS. COHEN: That plus the quality, of course,

21 of any -- any alternative approach that you think would

22 be appropriate.

23 MR. GALLOWAY: Thank you for your time.

24 MS. COHEN: Thank you. Is there anybody else

25 who wishes to speak?

831 If there's no other party who wishes to

2 present testimony to this hearing panel and there are no

3 other comments to be presented, then we will proceed to

4 close this hearing.

5 As noted at the outset, the public comment

6 period for this proposed rule will remain open until

7 July 23rd, 2010. All interested parties are encouraged

8 to provide their written test -- written comments on the

9 proposed rule, as well as any comments, testimony,

10 information, data, and evidence presented by persons who

11 testified at today's hearing.

12 These written comments should be submitted in

13 accordance with the May 26, 2010 Federal Register

14 noted -- notice. This hearing is hereby closed. Thank

15 you.

16 (11:00 a.m. hearing concluded.)

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841 STATE OF MICHIGAN )

2

3 COUNTY OF WASHTENAW )

4

5 I certify that this transcript is a complete, true,

6 and correct record of the testimony of ENVIRONMENTAL

7 PROTECTION AGENCY HEARING, Office of Transportation and Air

8 Quality, Compliance and Innovative Strategies Division,

9 6-23-10, Ann Arbor, Michigan, to the best of my ability.

10

11 I also certify that I am not a relative or employee

12 of a party, or a relative or employee of an attorney for a

13 party, have a contract with a party, or am financially

14 interested in the aforementioned action.

15

16

17 _______________________________

18 Jacqueline D. Duchene, CSR-4182

Ann Arbor Reporting Service, Inc.

19 2551 Jade Court

Ann Arbor, MI 48103

20

21 JULY 7, 2010

Notary Public, Washtenaw County, Michigan

22 Acting in Washtenaw

My Commission Expires: 12-15-12

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